Exhibit 10.54


 


APN Nos.:
162-16-211-002, 162-16-202-005 and 162-16-202-007

Tax Mailing Address:

Venetian Casino Resort, LLC

c/o Finance Department

201 East Sands Avenue

Las Vegas, Nevada 89109-2617


 


Recording at the
request of

and when recorded mail to:


 


Douglas L. Wisner,
Esq.

Mayer, Brown, Rowe & Maw

1675 Broadway

New York, New York  10019


 


DEED OF TRUST, LEASEHOLD DEED OF TRUST, ASSIGNMENT
OF RENTS AND LEASES,

SECURITY AGREEMENT AND FIXTURE FILING


 


made by


 


PHASE II MALL HOLDING, LLC,

a Nevada limited liability company


 


and


 


PHASE II MALL SUBSIDIARY, LLC,

a Delaware limited liability company,

jointly and severally

as Trustor,


 


to


 


FIRST AMERICAN TITLE INSURANCE
COMPANY,

a California corporation,

as Trustee,


 


for the benefit of


 


THE BANK OF NOVA SCOTIA, in its capacity

as Administrative Agent, as Beneficiary


 


THIS INSTRUMENT IS TO BE FILED AND INDEXED IN THE REAL ESTATE RECORDS
AND IS ALSO TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS OF CLARK COUNTY,
NEVADA UNDER THE NAMES OF PHASE II MALL HOLDING, LLC AND PHASE II MALL
SUBSIDIARY, LLC AS “DEBTOR” AND THE BANK OF NOVA SCOTIA, AS ADMINISTRATIVE
AGENT, AS SECURED PARTY.


 


THIS INSTRUMENT IS A “CONSTRUCTION MORTGAGE” AS THAT TERM IS DEFINED IN
SECTION 104.9334(8) OF THE NEVADA REVISED STATUTES AND SECURES AN OBLIGATION
INCURRED FOR THE CONSTRUCTION OF AN IMPROVEMENT UPON LAND.  THIS INSTRUMENT IS GOVERNED BY NRS 106.300 TO
106.400, INCLUSIVE, AND THE MAXIMUM AMOUNT OF PRINCIPAL (AS DEFINED IN NRS
106.345), INCLUDING FUTURE ADVANCES, SECURED BY THIS DEED OF TRUST IS
$250,000,000


 





















 


WHICH MAY INCREASE OR DECREASE FROM TIME TO TIME BY AMENDMENT OF THIS
INSTRUMENT.


 





















 


TABLE OF CONTENTS


 


	
  ARTICLE
  ONE

  	
  COVENANTS
  OF TRUSTOR

  	
   

  
	
  1.1

  	
  Performance of Deed of Trust

  	
   

  
	
  1.2

  	
  General Representations, Covenants and Warranties

  	
   

  
	
  1.3

  	
  Leasehold
  Estates

  	
   

  
	
  1.4

  	
  Payment of Subject Leases Expenses

  	
   

  
	
  1.5

  	
  Trustor’s Covenants with Respect to Subject
  Leases

  	
   

  
	
  1.6

  	
  Compliance with Legal Requirements

  	
   

  
	
  1.7

  	
  Impositions

  	
   

  
	
  1.8

  	
  Insurance

  	
   

  
	
  1.9

  	
  Condemnation

  	
   

  
	
  1.10

  	
  Space
  Leases

  	
   

  
	
  1.11

  	
  Authorization
  by Trustor

  	
   

  
	
  1.12

  	
  Security Agreement and Financing Statements

  	
   

  
	
  1.13

  	
  Assignment of Rents and Leases

  	
   

  
	
  1.14

  	
  Rejection of Subject Leases

  	
   

  
	
  1.15

  	
  Beneficiary’s Cure of Trustor’s Default

  	
   

  
	
  1.16

  	
  Use of Land and Leased Premises

  	
   

  
	
  1.17

  	
  Affiliates and Subsidiaries

  	
   

  
	
  1.18

  	
  Merger

  	
   

  
	
  ARTICLE
  TWO

  	
  CORPORATE
  LOAN PROVISIONS

  	
   

  
	
  2.1

  	
  Interaction with Construction Loan
  Agreement

  	
   

  
	
  2.2

  	
  Other
  Collateral

  	
   

  
	
  ARTICLE
  THREE

  	
  DEFAULTS

  	
   

  
	
  3.1

  	
  Event
  of Default

  	
   

  
	
  ARTICLE
  FOUR

  	
  REMEDIES

  	
   

  
	
  4.1

  	
  Acceleration of Maturity

  	
   

  
	
  4.2

  	
  Protective Advances

  	
   

  
	
  4.3

  	
  Institution of Equity Proceedings

  	
   

  
	
  4.4

  	
  Beneficiary’s Power of Enforcement

  	
   

  
				



 


i





















 


	
  4.5

  	
  Beneficiary’s Right to Enter and Take
  Possession, Operate and Apply Income

  	
   

  
	
  4.6

  	
  Space
  Leases

  	
   

  
	
  4.7

  	
  Purchase by Beneficiary

  	
   

  
	
  4.8

  	
  Waiver of Appraisement, Valuation, Stay, Extension and Redemption
  Laws

  	
   

  
	
  4.9

  	
  Receiver

  	
   

  
	
  4.10

  	
  Suits to Protect the Trust Estate

  	
   

  
	
  4.11

  	
  Proofs
  of Claim

  	
   

  
	
  4.12

  	
  Trustor to Pay the Notes on Any Default in
  Payment; Application of Monies by Beneficiary

  	
   

  
	
  4.13

  	
  Delay
  or Omission; No Waiver

  	
   

  
	
  4.14

  	
  No Waiver of One Default to Affect Another

  	
   

  
	
  4.15

  	
  Discontinuance of Proceedings; Position of Parties Restored

  	
   

  
	
  4.16

  	
  Remedies Cumulative

  	
   

  
	
  4.17

  	
  Interest After Event of Default

  	
   

  
	
  4.18

  	
  Foreclosure;
  Expenses of Litigation

  	
   

  
	
  4.19

  	
  Deficiency Judgments

  	
   

  
	
  4.20

  	
  Waiver of July Trial

  	
   

  
	
  4.21

  	
  Exculpation of Beneficiary

  	
   

  
	
  ARTICLE
  FIVE

  	
  RIGHTS
  AND RESPONSIBILITIES OF TRUSTEE; OTHER PROVISIONS RELATING TO TRUSTEE

  	
   

  
	
  5.1

  	
  Exercise of Remedies by Trustee

  	
   

  
	
  5.2

  	
  Rights and Privileges of Trustee

  	
   

  
	
  5.3

  	
  Resignation or Replacement of Trustee

  	
   

  
	
  5.4

  	
  Authority of Beneficiary

  	
   

  
	
  5.5

  	
  Effect of Appointment of Successor Trustee

  	
   

  
	
  5.6

  	
  Confirmation of Transfer and Succession

  	
   

  
	
  5.7

  	
  Exculpation

  	
   

  
	
  5.8

  	
  Endorsement
  and Execution of Documents

  	
   

  
	
  5.9

  	
  Multiple
  Trustees

  	
   

  
				



 


ii





















 


	
  5.10

  	
  Terms of Trustee’s Acceptance

  	
   

  
	
  ARTICLE
  SIX

  	
  MISCELLANEOUS
  PROVISIONS

  	
   

  
	
  6.1

  	
  Heirs, Successors and Assigns Included in Parties

  	
   

  
	
  6.2

  	
  Addresses for Notices, Etc

  	
   

  
	
  6.3

  	
  Change of Notice Address

  	
   

  
	
  6.4

  	
  Headings

  	
   

  
	
  6.5

  	
  Invalid Provisions to Affect No Others

  	
   

  
	
  6.6

  	
  Changes and Priority Over Intervening Liens

  	
   

  
	
  6.7

  	
  Estoppel Certificates

  	
   

  
	
  6.8

  	
  Waiver of Setoff and Counterclaim

  	
   

  
	
  6.9

  	
  Governing
  Law

  	
   

  
	
  6.10

  	
  Reconveyance

  	
   

  
	
  6.11

  	
  Attorneys’
  Fees

  	
   

  
	
  6.12

  	
  Late
  Charges

  	
   

  
	
  6.13

  	
  Cost of Accounting

  	
   

  
	
  6.14

  	
  Right
  of Entry

  	
   

  
	
  6.15

  	
  Corrections

  	
   

  
	
  6.16

  	
  Statute of Limitations

  	
   

  
	
  6.17

  	
  Subrogation

  	
   

  
	
  6.18

  	
  Joint and Several Liability

  	
   

  
	
  6.19

  	
  Homestead

  	
   

  
	
  6.20

  	
  Context

  	
   

  
	
  6.21

  	
  Time

  	
   

  
	
  6.22

  	
  Interpretation

  	
   

  
	
  6.23

  	
  Effect of NRS § 107.030

  	
   

  
	
  6.24

  	
  Amendments

  	
   

  
	
  6.25

  	
  No
  Conflicts

  	
   

  
	
  ARTICLE
  SEVEN

  	
  POWER
  OF ATTORNEY

  	
   

  
	
  7.1

  	
  Grant
  of Power

  	
   

  
				



 


iii





















 


 


	
  EXHIBIT A

  	
  LEGAL
  DESCRIPTION OF PHASE II MALL AIR SPACE

  
	
  EXHIBIT B

  	
  LEGAL
  DESCRIPTION OF WALGREENS AIR SPACE

  
	
  EXHIBIT C

  	
  CONDEMNATION
  PROCEEDINGS

  



 


 


1





















 


DEED OF TRUST, LEASEHOLD DEED OF TRUST, ASSIGNMENT OF RENTS AND LEASES,
SECURITY AGREEMENT AND FIXTURE FILING


 


THIS DEED OF TRUST, LEASEHOLD DEED OF TRUST,
ASSIGNMENT OF RENTS AND LEASES, SECURITY AGREEMENT
AND FIXTURE FILING (hereinafter called “Deed
of Trust”) is made and effective as of September 30, 2004, by PHASE
II MALL HOLDING, LLC (“Phase II Mall Subsidiary
Holding”), a Nevada limited liability company, and PHASE II MALL
SUBSIDIARY, LLC, a Delaware limited liability company (“Phase II
Mall Subsidiary” and jointly and severally with Phase II Mall
Subsidiary Holding together with all successors and assigns of the Trust Estate
(as hereinafter defined), “Trustor”) whose
address is 3355 Las Vegas Boulevard South, Room 1A, Las Vegas, Nevada 89109,
Attention: General Counsel, to FIRST
AMERICAN TITLE INSURANCE COMPANY, a California corporation,
whose address is 180 Cassia Way, Suite 502, Henderson, Nevada 89104, Attention:
Julie Skinner, as Trustee (“Trustee”),
for the benefit of THE BANK OF NOVA SCOTIA,
a Canadian chartered bank (“Beneficiary”),
whose address is 580 California Street, 21st Floor, San Francisco,
California 94104, Attention: Mr. Alan Pendergast, in its capacity as
Administrative Agent under that certain Construction Loan Agreement dated as of
September 30, 2004, among Trustor, Beneficiary, as Administrative Agent, Sole
Lead Arranger and Sole Bookrunner, Sumitomo Mitsui Banking Corporation, as
Syndication Agent and the lenders (the “Lenders”)
from time to time parties thereto (as the same may be amended, supplemented,
amended and restated, increased or otherwise modified from time to time, the “Construction Loan Agreement”).


 


INTEREST
ON OBLIGATIONS SECURED HEREBY ACCRUES AT A RATE WHICH MAY FLUCTUATE FROM TIME
TO TIME.


 


DEFINITIONS — As used in this Deed of Trust, the
following terms have the meanings hereinafter set forth:


 


“Accounts Receivable” shall have the meaning
set forth in Section 9-102 (NRS 104.9102) of the UCC for the
term “account.”


 


“Appurtenant Rights” means all and singular tenements,
hereditaments, rights, reversions, remainders, development rights, privileges,
benefits, Easements, rights-of-way, gores or strips of land,
streets, ways, alleys, passages, sewer rights, water courses, water rights and
powers, and all appurtenances whatsoever and claims or demands of Trustor at
law or in equity in any way belonging, benefiting, relating or appertaining to
the Phase II Mall and the Phase II Mall Improvements or any of the Trust Estate
encumbered by this Deed of Trust, or which hereinafter shall in any way belong,
relate or be appurtenant thereto, whether now owned or hereafter acquired by
Trustor, whether or not the same are of record.


 


“Bankruptcy” means, with respect to any Person that:
(i) a court having jurisdiction in the Trust Estate shall have entered a
decree or order for relief in respect of such Person in an involuntary case
under the Bankruptcy Code or under any other applicable bankruptcy, insolvency
or similar law now or hereafter in effect, which decree or order has not been
stayed; or any other similar relief shall have been granted under any
applicable federal or state law; or


 





















 


(ii) an
involuntary case shall be commenced against such Person, under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect; or a decree or order of a court having jurisdiction in the
Trust Estate for the appointment of a receiver, liquidator, sequestrator,
trustee, custodian or other officer having similar powers over such Person, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of such Person, for all or a substantial part of its
property; or a warrant of attachment, execution or similar process shall have
been issued against any substantial part of the property of such Person, and
any such event described in this clause (ii) shall continue for sixty (60)
days without being dismissed, bonded or discharged; or (iii) such Person
shall have an order for relief entered with respect to it or shall commence a
voluntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such law, or
shall consent to the appointment of or taking possession by a receiver, trustee
or other custodian for all or a substantial part of its property; or such
Person shall make any assignment for the benefit of creditors or shall fail
generally, or shall admit in writing its inability, to pay its debts as such
debts become due and payable and a period of thirty (30) days shall have
elapsed; or (iv) such Person shall be unable, or shall fail generally, or
shall admit in writing its inability, to pay its debts as such debts become due
and a period of thirty (30) days shall have elapsed; or the Board of Directors
of such Person (or any committee thereof) or the managing member of such Person
shall, adopt any resolution or otherwise authorize any action to approve any of
the actions referred to in clause (iii) above or this clause (iv).


 


“Beneficiary”
has the meaning set forth in the preamble.


 


“Construction
Loan Agreement” has the meaning set forth in the preamble.


 


“Deed of Trust” means this Deed of Trust, Leasehold Deed of
Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing as
it may be amended, supplemented, amended and restated, increased or otherwise
modified from time to time.


 


“Default Rate” means the interest rate that shall be due upon
an Event of Default pursuant to Section 2.2E of the Construction Loan
Agreement.


 


“Easement” means
any easement appurtenant, easement in gross, license agreement or other right
running for the benefit of Trustor, the Phase II Mall, the HVAC Component or
appurtenant thereto which benefits the Phase II Mall, including Site Easements,
Phase II Mall Space Easements and such other easements and licenses which
benefit any of the foregoing and are described in the Cooperation Agreement
(if, as and when applicable to the Phase II Project) or each title insurance
policy issued by the Title Insurer with regard to the Phase II Mall Space.


 


“Enumerated Names” has the meaning set forth in Section 1.2
hereof.


 


“Estoppel Certificate” has the meaning set forth in Section 6.7
hereof.


 


“Event of Default” has the meaning set forth in Section 3.1
hereof.


 


2





















 


“Existing Facility”
means the Venetian Casino Resort, a Venetian-themed hotel, casino,
retail, meeting and entertainment complex located at 3355 Las Vegas Boulevard
South, Clark County, Nevada.


 


“Existing Site”
means the land on which the Existing Facility is constructed.


 


“FF&E” means all furniture, fixtures, equipment,
appurtenances and personal property now or in the future contained in, used in
connection with, attached to, or otherwise useful or convenient to the use,
operation, or occupancy of, or placed on, but unattached to, any part of the
Phase II Mall or the Phase II Mall Space whether or not the same constitutes
real property or fixtures in the State, including all removable window and
floor coverings, all furniture and furnishings, heating, lighting, plumbing,
ventilating, air conditioning, refrigerating, incinerating, cleaning equipment,
all elevators, escalators and elevator and escalator plants, cooking
facilities, vacuum cleaning systems, public address and communications systems,
switchboards, security and surveillance equipment and devices, sprinkler
systems and other fire prevention and extinguishing apparatus and materials,
motors, machinery, pipes, appliances, equipment, fittings, fixtures, and building
materials, all exercise equipment, all gaming and financial equipment, computer
equipment, calculators, adding machines and any other electronic equipment of
every nature used or located on any part of the Phase II Mall or the Phase II
Mall Improvements, together with all venetian blinds, shades, draperies,
drapery and curtain rods, brackets, bulbs, cleaning apparatus, mirrors, lamps,
ornaments, cooking apparatus and equipment, china, flatware, dishes, utensils,
glassware, ranges and ovens, garbage disposals, dishwashers, mantels, and any
and all such property which is at any time installed in, affixed to or placed
upon the Phase II Mall or the Phase II Mall Improvements.


 


“GGP” means GGP
Limited Partnership, a Delaware limited partnership, and any successor thereto
by merger or by operation of law.


 


“Imposition” means any taxes, assessments, water rates, sewer
rates, maintenance charges, other impositions by any Governmental
Instrumentality and other charges now or hereafter levied or assessed or
imposed against the Trust Estate or any part thereof, and any amount payable
with respect thereto under the Cooperation Agreement (if, as and when
applicable to the Phase II Project) or any other Resort Complex Operative
Document.


 


“Income” means
all Rents, security or similar deposits, revenues, issues, royalties, earnings,
products or Proceeds, profits, income and other benefits from the Trust Estate.


 


“Insolvent” means with respect to any Person, that such
Person shall be deemed to be insolvent if such Person shall fail generally, or
shall admit in writing its inability, to pay its debts as such debts become due
and payable and a period of thirty (30) days shall have elapsed.


 


“Intangible Collateral” means (a) the rights to use all
names and all derivations thereof now or hereafter used by Trustor in
connection with the Phase II Mall or the Phase II Mall Improvements, including,
without limitation, the names “Venetian” and “Palazzo,” including any
variations thereon, together with the goodwill associated therewith, and all
names, logos, and designs used by Trustor, or in connection with the Phase II
Mall or the Phase II Mall Improvements or in which Trustor has rights, with the
exclusive right to use such names, logos


 


3





















 


and designs
wherever they are now or hereafter used in connection with the Phase II Mall or
the Phase II Mall Improvements (or in connection with the marketing of the
thereof together with the “SECC Land” (as defined in the Cooperation Agreement
if, as and when applicable to the Phase II Project) in accordance with the
terms of the Cooperation Agreement if, as and when applicable to the Phase II
Project), and any and all other trade names, trademarks or service marks,
whether or not registered, now or hereafter used in the operation of the Phase
II Mall or the Phase II Mall Improvements, including, without limitation, any
interest as a lessee, licensee or franchisee, and, in each case, together with
the goodwill associated therewith; (b) subject to the absolute assignment
contained herein, the Rents; (c) any and all books, records, customer
lists, concession agreements, supply or service contracts, licenses, permits,
approvals by Governmental Instrumentalities (to the extent Legal Requirements
permit or do not expressly prohibit the pledge of such licenses, permits and
approvals), signs, goodwill, credit and charge records, supplier lists,
checking accounts, safe deposit boxes (excluding the contents of such deposit
boxes owned by Persons other than Trustor), cash, instruments, chattel papers,
including inter-company notes and pledges, documents, unearned premiums,
deposits, refunds, including but not limited to income tax refunds, prepaid
expenses, rebates, tax and insurance escrow and impound accounts, if any,
actions and rights in action, and all other claims, including without
limitation condemnation awards and insurance proceeds, and all other contract
rights and general intangibles resulting from or used in connection with the
operation and occupancy of the Trust Estate and in which Trustor now or
hereafter has rights; and (d) general intangibles, including without
limitation all rents, issues, profits, income and maintenance fees resulting
therefrom, whether any of the foregoing is now owned or hereafter acquired.


 


“Leased Premises”
means, as the context may require the Phase II Mall Air Space, the Phase II Hotel/Casino Retail Stores
and/or the Walgreens Air Space.


 


“LCR” means Lido
Casino Resort, LLC, a Nevada limited liability company.


 


“Master Lease”
means  that certain  lease  to
be entered into between LCR and Phase II Mall Subsidiary, whereby Phase II Mall
Subsidiary will lease the Phase II Hotel/Casino Retail Store Space from LCR.


 


“NRS” means the Nevada Revised Statutes as in effect from
time to time.


 


“Personal Property” has the meaning set forth in Section 1.12.


 


“Phase II Hotel/Casino”
means an approximately 3,000 suite hotel, a gaming facility of approximately
100,000 square feet, a multi-story parking structure and meeting complex on a
portion of the Site to be integrated with the Phase II Mall and the Existing
Facility.


 


“Phase II
Hotel/Casino Retail Stores” means the retail stores that are to be
constructed by LCR in the Phase II Hotel/Casino and leased by LCR to Phase II
Mall Subsidiary pursuant to the Master Lease.


 


“Phase II Mall”
means the Phase II Mall Space (a portion of which shall be initially leased by
Phase II Mall Subsidiary from LCR pursuant to the Phase II Mall Lease and
eventually transferred from LCR to Phase II Mall Subsidiary upon its
designation as one or more separate legal parcels in accordance with the
Disbursement Agreement to become the Phase II Mall Air


 


4





















 


Parcel, a portion of which shall be leased by Phase II
Mall Subsidiary pursuant to the Walgreens Lease and a portion of which shall be
leased by Phase II Mall Subsidiary pursuant to the Master Lease) and the Phase
II Mall Improvements located therein, in each case to be integrated with the
Phase II Hotel/Casino and the Existing Facility.


 


“Phase II Mall Air Parcel”
means the one or more separate legal parcels owned or to be owned in fee simple
by Phase II Mall Subsidiary after the Phase II Mall Air Space is subdivided in
accordance with Section 5.11 of the Disbursement Agreement and within which a
portion of the Phase II Mall Improvements is to be constructed.


 


“Phase II
Mall Air Space” is described in Exhibit A attached hereto and
incorporated herein by reference, including any after acquired title thereto.


 


 “Phase II Mall Improvements” means the “Mall Improvements”
(as such term is defined in the Phase II Mall Sale Agreement) together with all
the buildings, structures, facilities and improvements of every nature
whatsoever now or hereafter situated on the Phase II Mall Space and all
fixtures, machinery, appliances, goods, building or other materials, equipment,
including without limitation all machinery, equipment, engines, appliances and
fixtures for generating or distributing air, water, heat, electricity, light,
fuel or refrigeration, or for ventilating or sanitary purposes, or for the
exclusion of vermin or insects, or for the removal of dust, refuse or garbage;
wall-safes, built-in furniture and installations, shelving,
lockers, partitions, doorstops, vaults, motors, elevators, dumb-waiters,
awnings, window shades, venetian blinds, light fixtures, fire hoses and
brackets and boxes for the same, fire sprinklers, alarm, surveillance and
security systems, computers, drapes, drapery rods and brackets, mirrors,
mantels, screens, linoleum, carpets and carpeting, plumbing, bathtubs, sinks,
basins, pipes, faucets, water closets, laundry equipment, washers, dryers, ice-boxes
and heating units; all kitchen and restaurant equipment, including but not
limited to silverware, dishes, menus, cooking utensils, stoves, refrigerators,
ovens, ranges, dishwashers, disposals, water heaters, incinerators, furniture,
fixtures and furnishings, communication systems, and equipment; all cocktail
lounge supplies, including but not limited to bars, glassware, bottles and tables used  in
connection with the Phase II Mall and
the Phase II Mall Improvements; all chaise lounges, hot tubs, swimming pool
heaters and  equipment and
all other recreational equipment (computerized and otherwise), beauty and barber
equipment, and maintenance supplies used in connection with the Phase II Mall
and Phase II Mall Improvements; all amusement rides and attractions attached to
the Phase II Mall and the Phase II Mall Improvements, all specifically designed
installations and furnishings, and all furniture, furnishings and personal
property of every nature whatsoever now or hereafter owned or leased by Trustor
or in which Trustor has any rights or interest and located in or on, or
attached to, or used or intended to be used or which are now or may hereafter
be appropriated for use on or in connection with the operation of the Phase II
Mall or the Phase II Mall Improvements or any personal property encumbered
hereby or any other Phase II Mall Improvements, or in connection with any
construction being conducted or which may be conducted thereon, and all
extensions, additions, accessions, improvements, betterments, renewals,
substitutions, and replacements to any of the foregoing, and all of the right,
title and interest of Trustor in and to any such property, which, to the
fullest extent permitted by Legal Requirements, shall be conclusively deemed
fixtures and improvements and a part of the Trust Estate hereby encumbered.


 


5





















 


“Phase II Mall Lease”
means that certain Indenture of Lease, dated as of the date hereof by and
between LCR and Phase II Mall Subsidiary covering the Phase II Mall Air Space,
a memorandum of which was recorded on October         ,
2004 in Book #                            
as Instrument #                            
in the Office of the County Recorder, Clark County, Nevada, as the same may be
amended, supplemented, amended and restated, or otherwise modified in
accordance with the terms hereof.


 


“Phase II Mall SA Assignment
Agreement” means that certain Assignment and Assumption
Agreement and First Amendment to Agreement, dated as of the date hereof, among
LCR, as the assignor, Phase II Mall Subsidiary Holding, as the assignee, and
GGP.


 


“Phase II Mall Sale
Agreement” means the Agreement, dated as of April 12, 2004 between
LCR and GGP, as amended by the Phase II Mall SA Assignment Agreement, and as
the same may be further amended, supplemented, amended and restated, or
otherwise modified in accordance with the terms hereof.


 


“Phase II
Mall Sale Agreement Proceeds” has the meaning set forth in Granting
Clause H.


 


“Phase II Mall Space”
means, collectively, the space in which the Phase II Hotel/Casino Retail Stores
will be situated (which shall be leased by Phase II Mall Subsidiary pursuant to
the Master Lease), the Phase II Mall Air Space (which shall be initially leased
by Phase II Mall Subsidiary from LCR pursuant to the Phase II Mall Lease and
eventually transferred from LCR to Phase II Mall Subsidiary upon its designation
as one or more separate legal parcels in accordance with the Disbursement
Agreement to become the Phase II Mall Air Parcel), the Phase II Mall Air Parcel
and the Walgreens Air Space.


 


“Phase II Mall Space
Easements” means any easements appurtenant, easements in gross,
license agreements or other rights running for the benefit of Phase II Mall
Subsidiary with respect to the Phase II Mall Space and/or appurtenant to the
Phase II Mall Space, including, without limitation, those certain easements and
licenses described in each Title Policy related to the Phase II Mall Space.


 


“Phase II
Mall Subsidiary” has the meaning set forth in the preamble.


 


“Phase II
Mall Subsidiary Holding” has the meaning set forth in the preamble.


 


“Phase II Project”
means an approximately 3,000 room hotel, casino, retail and meeting complex to
be integrated with the Existing Facilities and located on the Site which will
include the Phase II Mall.


 


“Proceeds” has the meaning assigned to it under the UCC and,
in any event, shall include but not be limited to (i) any and all proceeds
of any insurance (including without limitation property casualty and title
insurance), indemnity, warranty or guaranty payable from time to time with
respect to all or a portion of the Trust Estate; (ii) any and all proceeds
in the form of accounts, security deposits, tax escrows (if any), down payments
(to the extent Legal Requirements permit the same may to be pledged),
collections, contract rights, documents, instruments, chattel paper, Liens and
security instruments, guarantees or general intangibles


 


6





















 


relating in whole
or in part to the Phase II Mall or the Phase II Mall Improvements and all
rights and remedies of whatever kind or nature Trustor or its Subsidiaries may
hold or acquire for the purpose of securing or enforcing any obligation due
Trustor or its Subsidiaries thereunder; (iii) any and all payments in any
form whatsoever made or due and payable from time to time in connection with
any requisition, confiscation, condemnation, seizure or forfeiture of all or
any part of the Trust Estate by any Governmental Instrumentality;
(iv) subject to the absolute assignment contained herein, the Rents or
other benefits arising out of, in connection with or pursuant to Phase II Mall
Lease, the Master Lease, the Walgreens Lease or any Space Lease of the Trust
Estate; and (v) any and all other amounts from time to time paid or
payable in connection with any of the Trust Estate; provided, however,
that neither the Trustor nor its Subsidiaries is authorized to sell, transfer,
convey, mortgage, pledge, grant rights in or otherwise dispose of any of the
Trust Estate unless permitted under the Construction Loan Agreement.


 


“Protective Advance” has the meaning set forth in Section 4.2.


 


“Rents” means all rents, Income, receipts, issues, profits,
revenues and maintenance fees, food and beverage revenues, license and
concession fees, Proceeds and other benefits to which Trustor or its
Subsidiaries may now or hereafter be entitled from the Phase II Mall or the
Phase II Mall Improvements therein or thereon, as applicable, or any property
encumbered hereby or any business or other activity conducted by Trustor or any
of its Subsidiaries at the Phase II Mall or the Phase II Mall Improvements.


 


“Site”
means the real property consisting of approximately 14 acres adjoining the
Existing Site and owned by LCR.


 


“Site Easement”  means any easement appurtenant,
easement in gross, license agreement and other right running for the benefit of
Trustor, the Existing Facility, the Phase II Project, the HVAC Component or
appurtenant to the Site and/or the Existing Site which benefits or burdens the
Resort Complex.


 


“Space Leases” means any and all leases (excluding the
Subject Leases), subleases, lettings, licenses, concessions, operating
agreements, management agreements, and all other agreements affecting all or a
portion of the Trust Estate, that Trustor or any of its Subsidiaries has
entered into, taken by assignment, taken subject to, or assumed, or has
otherwise become bound by, now or in the future, that give any Person the right
to conduct its business on, or otherwise use, operate or occupy, all or any
portion of the Phase II Mall or the Phase II Mall Improvements including,
without limitation, the right to use or occupy space for kiosk(s) or vendor
cart(s), and all rights of Trustor or any Subsidiary (if any) thereto or
therefrom and any leases, agreements or arrangements permitting anyone to enter
upon or use all or any portion of the Trust Estate to extract or remove natural
resources of any kind, together with all amendments, extensions, and renewals
of the foregoing entered into in compliance with the Construction Loan
Agreement, together with all rental, occupancy, service, maintenance or any
other similar agreements pertaining to use or occupation of, or the rendering
of services at the Phase II Mall or the Phase II Mall Improvements or any part
thereof.


 


7





















 


“Space Lessee(s)” means any and all tenants, licensees, or
other grantees of the Space Leases and any and all guarantors, sureties,
endorsers or others having primary or secondary liability with respect to such
Space Leases.


 


“State” means
the State of Nevada.


 


“Subject Leases”
means the Master Lease, Phase II Mall Lease and the Walgreens Lease.


 


“Tangible Collateral” means all personal property, goods,
equipment, supplies, building and other materials of every nature whatsoever
and all other tangible personal property constituting a part or portion of the
Phase II Mall or the Phase II Mall Improvements and/or used in the operation of
the restaurants or stores and all other Phase II Mall Improvements including,
but not limited to, communication systems, visual and electronic surveillance
systems and transportation system and not constituting a part of the real
property subject to the Lien of this Deed of Trust and including all property
and materials stored therein in which Trustor or any Subsidiary has an interest
and all tools, utensils, food and beverage, liquor, uniforms, linens and
maintenance supplies, vehicles, fuel, advertising and promotional material,
blueprints, surveys, plans and other documents relating to the Phase II Mall or
the Phase II Mall Improvements, and all construction materials and all
furnishings, fixtures and equipment, including, but not limited to, all
FF&E and all equipment and devices which are or are to be installed and
used in connection with the operation of the Phase II Mall or the Phase II Mall
Improvements those items of furniture, fixtures and equipment which are to be
purchased or leased by Trustor or its Subsidiaries, machinery and any other
items of personal property in which Trustor or its Subsidiaries now or
hereafter own or acquire an interest or right and which are used or useful in
the construction, operation, use and occupancy of the Phase II Mall or the
Phase II Mall Improvements and all present and future right and interest of
Trustor or its Subsidiaries in and to any license agreement or sublease
agreement used in connection with the Phase II Mall or the Phase II Mall
Improvements.


 


“Title Insurer” means First American Title Insurance Company,
a Nevada corporation or an Affiliate thereof.


 


“Trustee”
has the meaning set forth in the preamble.


 


“Trust Estate” means all of the property described in Granting
Clauses (A) through (O) below, inclusive, and each item of
property therein described, provided, however, that such term
shall not include the property described in Granting Clause (Q)
below.


 


“UCC” means the Uniform Commercial Code in effect in the
State from time to time, NRS chapters 104 and 104A.


 


“Walgreens
Air Space” means the real property situated in the County of Clark,
State of Nevada described in the Walgreens Lease and more specifically
described in Exhibit B attached hereto and incorporated herein by
reference, including any after acquired title thereto.


 


“Walgreens Landlord” means
Cap II – Buccaneer, LLC, a New Mexico limited liability company.


 


8





















 


“Walgreens Lease”
means that certain commercial lease dated as of February 2004 between LCR, as
tenant, and Walgreens Landlord, as landlord, assigned in accordance with the
terms of the Construction Loan Agreement by LCR to Phase II Mall Subsidiary, a
memorandum of which was recorded on October      ,
2004 in Book #                            
as Instrument #                            
in the Office of the County Recorder, Clark County, Nevada.


 


The following terms shall
have the meaning assigned to such terms in the Construction Loan Agreement:


 


Affiliate

Asset Sale

Bankruptcy Code 

Business Day

Closing Date

Collateral

Collateral Documents

Cooperation Agreement

Disbursement Agreement

Gaming License

Governmental Instrumentality

HVAC Component 

Legal Requirements

Lenders

Lien

LVSI 

Loan Documents 

Net Loss Proceeds

Nevada Gaming Authorities

Nevada Gaming Laws

Notes

Obligations

Operative Documents

Permitted Liens

Person

Plans and Specifications


Requisite
Lenders

Resort Complex

Resort Complex Operative Documents

Subsidiary

Title Policy

Venetian


 


The following terms shall have the meaning assigned to
such terms in the Phase II Mall Sale Agreement:


 


9





















 


Adjustment
Payment

Closing Payment

Developer Liquidated Damages Amount

Earn-Out Payment

Recalculated Earn-Out


 


In addition, any capitalized terms used in this Deed
of Trust which are not otherwise defined herein shall have the meaning ascribed
to such terms in the Construction Loan Agreement.


 


W I T N E  S S E T H:


 


IN
CONSIDERATION OF TEN DOLLARS AND OTHER GOOD AND VALUABLE CONSIDERATION, THE
RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, AND FOR THE PURPOSE
OF SECURING in favor of Beneficiary (1) the due and punctual payment of
the portion of the Obligations evidenced by the Notes in the principal amount
of TWO HUNDRED FIFTY MILLION AND 00/100 DOLLARS or so much thereof as may be
advanced from time to time; (2) the performance of the Obligations and
each covenant and agreement of Trustor and the Subsidiaries contained in the
Construction Loan Agreement, herein or in the other Loan Documents;
(3) the payment of such additional loans or advances as hereafter may be
made to either Trustor (individually or jointly and severally with any other
Person), its successors or assigns or any Subsidiary, when evidenced by a
promissory note or notes reciting that they are secured by this Deed of Trust; provided,
however, that any and all future advances by Beneficiary or Lenders to
either Trustor or any of its Subsidiaries made for the improvement, protection
or preservation of the Trust Estate, together with interest at the interest
rate provided in the Construction Loan Agreement, shall be automatically
secured hereby unless such a note or instrument evidencing such advances
specifically recites that it is not intended to be secured hereby and
(4) the payment of all sums expended or advanced by Beneficiary or Lenders
under or pursuant to the terms hereof or to protect the security hereof
(including Protective Advances), together with interest thereon as herein
provided, Trustor, in consideration of the premises, and for the purposes
aforesaid, does hereby ASSIGN, BARGAIN, CONVEY, PLEDGE, RELEASE, HYPOTHECATE,
WARRANT, AND TRANSFER WITH POWER OF SALE UNTO TRUSTEE IN TRUST FOR THE BENEFIT
OF BENEFICIARY AND THE LENDERS  each of the
following:


 


(A)          Trustor’s interest in the Phase II
Mall and the leasehold estates created pursuant to Phase II Mall Lease and the
Walgreens Lease (in each case, to the extent permitted by, or not prohibited
by, the Nevada Gaming Laws and other applicable law);


 


(B)           TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to the Phase II Mall Improvements;


 


(C)           TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to all Appurtenant Rights;


 


10





















 


(D)          TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to the Tangible Collateral to the
extent permitted by, or not prohibited by, the Nevada Gaming Laws and other
applicable Legal Requirements;


 


(E)           TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to the Intangible Collateral to the
extent permitted by, or not prohibited by, Nevada Gaming Laws and other
applicable law;


 


(F)           TOGETHER
WITH (i) all the estate, right, title and interest of Trustor of, in and
to all judgments and decrees, insurance proceeds, awards of damages and
settlements hereafter made resulting from condemnation proceedings or the taking
of any of the property described in Granting Clauses (A), (B), (C),
(D), (E), (K), (L), and (M) hereof or any
part thereof under the power of eminent domain, or for any damage (whether
caused by such taking or otherwise) to the property described in Granting
Clauses (A), (B), (C), (D), (E), (K),
(L), and (M) hereof or any part thereof, or to any Appurtenant
Rights thereto, and Beneficiary is hereby authorized to collect and receive
said awards and proceeds and to give proper receipts and acquittance therefor,
and (subject to the terms of the Construction Loan Agreement) to apply the same
to the extent constituting Net Loss Proceeds toward the payment of the
Obligations and other sums secured hereby, notwithstanding the fact that the
amount owing thereon may not then be due and payable; (ii) all proceeds of
any sales or other dispositions of the property or rights described in Granting
Clauses (A), (B), (C), (D), (E), (H),
(K), (L) and (M) hereof or any part thereof whether
voluntary or involuntary, provided, however, that the foregoing
shall not be deemed to permit Asset Sales except as specifically permitted in
the Construction Loan Agreement; and (iii) whether arising from any
voluntary or involuntary disposition of the Collateral described in Granting
Clauses (A), (B), (C), (D), (E), (H),
(K), (L) and (M), all Proceeds, all Phase II Mall Sale
Agreement Proceeds, products, replacements, additions, substitutions, renewals
and accessions, remainders, reversions and after-acquired interest in, of
and to such Collateral;


 


(G)           TOGETHER
WITH, the absolute assignment of any Space Leases or any part thereof that
Trustor has entered into, taken by assignment, taken subject to, or assumed, or
has otherwise become bound by, now or in the future, together with all of the
following (including all “Cash Collateral” within the meaning of the Bankruptcy
Code) arising from the Space Leases: 
(a) Rents and Income (subject, however, to the aforesaid absolute
assignment to Trustee for the benefit of Beneficiary and the revocable license
hereinbelow granted to Trustor to collect the Rents), (b) all guarantees,
letters of credit, security deposits, collateral, cash deposits, and other
credit enhancement documents, arrangements and other measures with respect to
the Space Leases, (c) all of Trustor’s right, title, and interest under
the Space Leases, including the following: (i) the right to receive and
collect the Rents from the lessee, sublessee or licensee, or their
successor(s), under any Space Lease(s) and (ii) the right to enforce
against any tenants thereunder and otherwise any and all remedies under the
Space Leases, including Trustor’s right to evict from possession any tenant
thereunder or to retain, apply, use, draw upon, pursue, enforce or realize upon
any guaranty of any Space Lease; to terminate, modify, or amend the Space
Leases; to obtain possession of, use, or occupy, any of the real or personal
property subject to the Space Leases; and to enforce or exercise, whether at
law or in equity or by any other means, all provisions of the Space Leases and
all obligations of the tenants thereunder based upon (A) any breach by
such tenant under the applicable Space Lease (including any claim that Trustor
may have by reason of a termination, rejection, or disaffirmance of such Space


 


11





















 


Lease pursuant to the Bankruptcy Code) and (B) the use and
occupancy of the premises demised, whether or not pursuant to the applicable
Space Lease (including any claim for use and occupancy arising under landlord-tenant
law of the State or the Bankruptcy Code). 
A revocable license is hereby granted to Trustor, so long as no Event of
Default has occurred and is continuing hereunder, to collect and use the Rents,
as they become due and payable, but not more than one (1) month in advance
thereof.  Upon the occurrence of an Event
of Default, the permission hereby granted to Trustor to collect the Rents shall
automatically be revoked without notice until such time as such Event of
Default is cured and such cure is accepted by the Beneficiary; provided,
however, to the extent that the Required Lenders rescind and annul an
acceleration of the Loans in accordance with the provisions of the last
paragraph of Section 7.15 of the Construction Loan Agreement, such revocable
license shall be reinstated.  Beneficiary
shall have the right, at any time and from time to time, to notify any Space
Lessee of the rights of Beneficiary as provided by this Granting Clause (G);


 


Notwithstanding anything
to the contrary contained herein, the foregoing provisions of this Granting
Clause (G) shall not constitute an assignment for purposes of security but
shall to the extent permitted by, or not prohibited by, the Nevada Gaming Laws
and other applicable law constitute an absolute and present assignment of the
Rents to Beneficiary; subject, however, to the conditional
license given to Trustor to collect and use the  Rents
as hereinabove provided; and the existence or exercise of such right of Trustor
shall not operate to subordinate this assignment to any subsequent assignment,
in whole or in part, by Trustor;


 


(H)          TOGETHER
WITH, the absolute assignment of the Phase II Mall Sale Agreement, together
with all of the following (including all “Cash Collateral” within the meaning
of the Bankruptcy Code) arising from the Phase II Mall Sale Agreement:  (a) the Closing Payment, the Adjustment
Payments, the Earn-Out Payment, the Recalculated Earn-Out, the Developer
Liquidated Damages Amount, amounts recovered by Trustor from GGP under paragraph
21.2 of the Phase II Mall Sale Agreement and all other deposits, revenues,
issues, products, Proceeds, profits, income and other benefits therefrom and
thereunder (collectively, the “Phase II Mall Sale
Agreement Proceeds” (subject, however, to the aforesaid absolute
assignment to Trustee for the benefit of Beneficiary and the revocable license
hereinbelow granted to Trustor to collect the Phase II Mall Sale Agreement
Proceeds), (b) all guarantees (including the guarantees by LCR set forth
in the Phase II Mall SA Assignment Agreement), letters of credit, security
deposits, collateral, cash deposits, and other credit enhancement documents,
arrangements and other measures with respect to the Phase II Mall Sale
Agreement, (c) all of Trustor’s right, title, and interest under the Phase
II Mall Sale Agreement, including the following: (i) the right to receive
and collect the Phase II Mall Sale Agreement Proceeds and any other amounts
from GGP and its successor(s) under the Phase II Mall Sale Agreement and (ii) the
right to enforce against GGP and its successor(s) any and all remedies under
the Phase II Mall Sale Agreement, including Trustor’s right to retain, apply,
use, draw upon, pursue, enforce or realize upon any guaranty of the Phase II
Mall Sale Agreement (including the guarantees by LCR set forth in the Phase II
Mall SA Assignment Agreement); to terminate, modify, amend or grant consents or
approvals under the Phase II Mall Sale Agreement; to obtain possession of, use,
or occupy, any of the Phase II Mall Space subject to the Phase II Mall Sale
Agreement; and to enforce or exercise, whether at law or in equity or by any
other means, all provisions of the Phase II Mall Sale Agreement and all
obligations of GGP and LCR thereunder based upon (A) any breach by GGP
under the Phase II Mall Sale Agreement or LCR under the Phase II Mall


 


12





















 


SA Assignment Agreement (including any claim that Trustor may have by
reason of a termination, rejection, or disaffirmance of the Phase II Mall Sale
Agreement pursuant to the Bankruptcy Code) and (B) the use and occupancy
of the portions of the Phase II Mall Space demised to Trustor pursuant to the
Subject Leases (including any claim for use and occupancy arising under
landlord-tenant law of the State or the Bankruptcy Code).  A revocable license is hereby granted to
Trustor, so long as no Event of Default has occurred and is continuing
hereunder, to collect and use the Phase II Mall Sale Agreement Proceeds as they
become due and payable.  Upon the
occurrence of an Event of Default, the permission hereby granted to Trustor to
collect Phase II Mall Sales Agreement Proceeds shall automatically be revoked
without notice until such time as such Event of Default is cured and such cure
is accepted by the Beneficiary; provided, however, to the extent
that the Required Lenders rescind and annul an acceleration of the Loans in
accordance with the provisions of the last paragraph of Section 7.15 of the
Construction Loan Agreement, such revocable license shall be reinstated.  GGP has been notified of the rights of
Beneficiary as provided by this Granting Clause (H);


 


Notwithstanding anything
to the contrary contained herein, the foregoing provisions of this Granting
Clause (H) shall not constitute an assignment for purposes of security but
shall to the extent permitted by, or not prohibited by, the Nevada Gaming Laws
and other applicable law constitute an absolute and present assignment of the
Phase II Mall Sale Agreement and the Phase II Mall Sale Agreement Proceeds to
Beneficiary; subject, however, to the conditional license given
to Trustor to collect and use the  Phase II Mall
Sale Agreement Proceeds as hereinabove provided; and the existence or exercise
of such right of Trustor shall not operate to subordinate this assignment to
any subsequent assignment, in whole or in part, by Trustor;


 


(I)            TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to any and all Plans and
Specifications and all maps, plans, specifications, surveys, studies, tests,
reports, data and drawings relating to the development of the Phase II Mall or
the Phase II Mall Improvements including, without limitation, all marketing
plans, feasibility studies, soils tests, design contracts and all contracts and
agreements of Trustor relating thereto including, without limitation,
architectural, structural, mechanical and engineering plans and specifications,
studies, data and drawings prepared for or relating to the development of the
Phase II Mall or the Phase II Mall Improvements or the construction, renovation
or restoration of any of the Phase II Mall Improvements or the extraction of
minerals, sand, gravel or other valuable substances from the Phase II Mall or
the Phase II Mall Improvements and purchase contracts or any agreement granting
Trustor a right to acquire any land situated within Clark County, Nevada;


 


(J)            TOGETHER WITH, to the extent
permitted by, or not prohibited by, the Nevada Gaming Laws and other applicable
Legal Requirements, all the estate, right, title and interest of Trustor of, in
and to any and all licenses, permits, variances, special permits, franchises,
certificates, rulings, certifications, validations, exemptions, filings,
registrations, authorizations, consents, approvals, waivers, orders, rights and
agreements (including, without limitation, options, option rights, contract
rights now or hereafter obtained by Trustor from any Governmental
Instrumentality having or claiming jurisdiction over the Phase II Mall or the
Phase II Mall Improvements or any other element of the Trust Estate or
providing access thereto, or the operation of any business on, at or from the
Phase II Mall or the Phase II Mall Improvements including, without limitation,
any liquor licenses or other licenses (except for any liquor licenses which are
non-assignable);


 


13





















 


(K)          TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to all water stock, water permits and
other water rights relating to the Phase II Mall or the Phase II Mall
Improvements;


 


(L)           TOGETHER WITH all the estate, right,
title and interest of Trustor of, in and to all oil and gas and other mineral
rights, if any, in or pertaining to the Phase II Mall or the Phase II Mall
Improvements and all royalty, leasehold and other rights of Trustor pertaining
thereto;


 


(M)         TOGETHER WITH any and all monies and
other property, real or personal, which may from time to time be subjected to
the Lien hereof by Trustor or by anyone on its behalf or with its consent, or
which may come into the possession or be subject to the control of Trustee or
Beneficiary pursuant to this Deed of Trust or any Loan Document granting a
security interest to the Beneficiary, including, without limitation, any
Protective Advances under this Deed of Trust; and all of Trustor’s right,
title, and interest in and to all extensions, improvements, betterments,
renewals, substitutes for and replacements of, and all additions, accessions,
and appurtenances to, any of the foregoing that Trustor may subsequently
acquire or obtain by any means, or construct, assemble, or otherwise place on
any of the Trust Estate, and all conversions of any of the foregoing; it being
the intention of Trustor that all property hereafter acquired by Trustor and
required by this Deed of Trust or any Loan Document granting a security
interest to the Beneficiary to be subject to the Lien of this Deed of Trust or
intended so to be shall forthwith upon the acquisition thereof by Trustor be
subject to the Lien of this Deed of Trust as if such property were now owned by
Trustor and were specifically described in this Deed of Trust and granted
hereby or pursuant hereto, and Trustee and Beneficiary are hereby authorized,
subject to Nevada Gaming Laws and other applicable Legal Requirements, to
receive any and all such property as and for additional security for the
obligations secured or intended to be secured hereby.  Trustor agrees to take any action as may
reasonably be necessary to evidence and perfect such Liens or security
interests, including, without limitation, the execution of any documents
necessary to evidence and perfect such Liens or security interests;


 


(N)          TOGETHER
WITH, to the extent permitted by applicable Legal Requirements, any and all
Accounts Receivable and all royalties, earnings, Income, Proceeds, Phase II
Mall Sale Agreement Proceeds, products, Rents, revenues, reversions,
remainders, issues, profits, avails, production payments, and other benefits
directly or indirectly derived or otherwise arising from any of the foregoing,
all of which are hereby assigned to Beneficiary, who, except as otherwise
expressly provided in this Deed of Trust (including the provisions of Section 1.13
hereof), is authorized to collect and receive the same, to give receipts and
acquittances therefor and to apply the same to the Obligations secured
hereunder, whether or not then due and payable;


 


(O)          TOGETHER
WITH Proceeds of the foregoing property described in Granting
Clauses (A) through (N);


 


(P)           TOGETHER
WITH Trustor’s rights further to assign, sell, lease, encumber or otherwise
transfer or dispose of the property described in Granting Clauses (A)
through (N) inclusive, above, for debt or otherwise; and


 


14





















 


(Q)          EXPRESSLY EXCLUDING, HOWEVER, (i)
any assets which if pledged, hypothecated or given as collateral security would
require Trustor to seek approval of any Nevada Gaming Authority of the pledge,
hypothecation or collateralization, or require the Beneficiary or any Person to
be licensed, qualified or found suitable by an applicable Nevada Gaming
Authority, (ii) any contracts, contract rights, permits or general intangibles,
which by their terms or the operation of law prohibit or do not allow
assignment or require any consent for assignment which has not been obtained or
which would be breached by virtue of a security interest being granted therein
and (iii) any fee interest of LCR in the Leased Premises, the Site or LCR’s
interest in the improvements thereon (other than with respect to the Trustor’s
interest in the Trust Premises, nothing in this Deed of Trust is intended to
restrict, encumber or affect LCR’s interests in its assets or properties).


 


Trustor, for itself and its successors and assigns,
covenants and agrees to and with Trustee that, at the time or times of the
execution of and delivery of these presents or any instrument of further
assurance with respect thereto, Trustor has good right, full power and lawful
authority to assign, grant, convey, warrant, transfer, bargain or sell its
interests in the Trust Estate in the manner and form as aforesaid, and that the
Trust Estate is free and clear of all Liens whatsoever, except the Permitted
Liens, and Trustor shall warrant and forever defend the Trust Estate in the
quiet and peaceable possession of Trustee and its successors and assigns
against all and every Person lawfully or otherwise claiming or to claim the
whole or any part thereof, subject to Permitted Liens.  Trustor agrees that any greater title to the
Trust Estate hereafter acquired by Trustor during the term hereof shall be
automatically subject hereto.


 


ARTICLE ONE




COVENANTS OF TRUSTOR


 


The Beneficiary and Lenders have been induced to enter
into the Construction Loan Agreement and the other Loan Documents and to make
the Loans to Trustor on the basis of the following material covenants, all
agreed to by Trustor:


 


1.1  Performance of Deed of Trust.  Trustor shall perform, observe and comply
with each and every provision hereof and of the other Loan Documents and shall
promptly pay, when payment shall become due, the principal with interest
thereon, the other Obligations and all other sums required to be paid by
Trustor hereunder and thereunder, as the case may be.


 


1.2  General Representations, Covenants
and Warranties.  Trustor represents,
covenants and warrants that: (a) Trustor has good and marketable title to
an indefeasible fee estate in the Phase II Mall Space (other than the portion
thereof that has been or will be leased pursuant to the Subject Leases) and a
valid leasehold interest in the portion of the Phase II Mall Space that has
been or will be leased pursuant to the Subject Leases), free and clear of all
Liens except Permitted Liens, and that it has the right to hold, occupy and
enjoy its interest in the Trust Estate, and has good right, full power and
lawful authority to subject the Trust Estate to the Lien of this Deed of Trust
and pledge the same as provided herein and Beneficiary may at all times
peaceably and quietly enter upon, hold, occupy and enjoy the entire Trust
Estate in accordance with the terms hereof; (b) neither Trustor nor any of
its Subsidiaries is Insolvent and no bankruptcy or insolvency proceedings are
pending or contemplated by or, to the best of Trustor’s


 


15





















 


knowledge, threatened against
Trustor nor any of its Subsidiaries; (c) all costs arising from
construction of any Phase II Mall Improvements, the performance of any labor
and the purchase of all Tangible Collateral and the Phase II Mall Improvements
have been or shall be paid when due (subject to the provisions of the
Construction Loan Agreement and this Deed of Trust); (d) the Phase II Mall
Space has access for ingress and egress to dedicated street(s); (e) Trustor
shall at all times conduct and operate the Trust Estate in a manner so as not
to lose, or permit LVSI, Venetian or any of their Subsidiaries to lose the
right to conduct gaming activities at the Phase II Project; (f) no
material part of the Trust Estate has been damaged, destroyed, condemned or
abandoned, other than those portions of the Trust Estate that have been the
subject of condemnation proceedings that have resulted in the conveyance of
such portion of the Trust Estate to the Trustor; (g) no part of the Trust
Estate is the subject of condemnation proceedings and Trustor has no knowledge
of any contemplated or pending condemnation proceeding with respect to any
portion of the Trust Estate other than condemnation proceedings set forth in Exhibit
C; and (h) Trustor acknowledges and agrees that it presently uses, and
has in the past used, certain trade or fictitious names in connection with the
operation of the business at the Trust Estate, including the names “Venetian,”
and “Palazzo” (all of the foregoing, collectively, the “Enumerated
Names”).  For all purposes of
this Deed of Trust it shall be deemed that the term “Trustor” includes, in
addition to “Phase II Mall Holding, LLC” and “Phase II Mall Subsidiary, LLC”
all trade or fictitious, names that Phase II Mall Subsidiary Holding, Phase II
Mall Subsidiary (or any successor or assign thereof) now or hereafter uses, or
has in the past used with respect to the Site, the Project or the Phase II Mall
Improvements without limitation, with the same force and effect as if this Deed
of Trust had been executed in all such names (in addition to “Phase II Mall
Holding, LLC” and “Phase II Mall Subsidiary, LLC”).


 


1.3  Leasehold Estates.  Trustor represents, covenants and warrants:
(a) that the Subject Leases are in full force and effect and unmodified; (b)
Trustor will defend the leasehold estate under each Subject Lease for the
entire remainder of the term set forth in each of the said Subject Leases
against all and every Person or Persons lawfully claiming, or who may claim the
same or any part thereof, subject to the payment of the rents in the Subject
Leases reserved and subject to the performance and observance of all of the
terms, covenants, conditions and warranties thereof; (c) that there is no
uncured default under any Subject Lease or in the performance of any of the
terms, covenants, conditions or warranties thereof on the part of the lessor or
the lessee to be observed and performed and that no state of facts exist under
a Subject Lease which, with the lapse of time or giving of notice or both would
constitute a default thereunder.


 


1.4  Payment
of Subject Leases Expenses.  The
Trustor shall pay or cause to be paid on or prior to the date due all rents,
additional rents and other Impositions payable by the lessor or the lessee
under the Subject Leases for which provision has not been made hereinbefore,
when and as often as the same shall become due and payable and the pro rata
share, if any, of all amounts payable under the Cooperation Agreement (if, as
and when applicable to the Phase II Project) allocable to the Phase II Mall and
the Phase II Mall Improvements.  Trustor
will in every case deliver, or cause to be delivered, proper receipts for any
such item so paid and will within ten (10) days after the time when such
payment shall be due and payable deliver to the Beneficiary, a copy of the
receipts for any such payments.


 


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1.5  Trustor’s Covenants with Respect to
Subject Leases.


 


(a)  The Trustor shall at all times promptly and
faithfully keep and perform, or cause to be kept and performed, all the
covenants and conditions contained in the Subject Leases to be kept and
performed by the lessor or the lessee under the Subject Leases and in all
respects conform to and comply with the terms and conditions of the Subject
Leases.  The Trustor further covenants
that it shall not do or permit anything to occur or omit to occur which will
impair or tend to impair the security of this Deed of Trust or will be grounds
for declaring a forfeiture of any Subject Lease, and upon any such failure as
aforesaid, Trustor shall be subject to all of the rights and remedies granted
Beneficiary in this Deed of Trust.


 


(b)  Except as otherwise permitted in the
Construction Loan Agreement, Trustor shall not modify, extend or in any way
alter the terms of the Subject Leases or cancel or surrender said Subject
Leases, or waive, execute, condone or in anyway release or discharge the lessor
thereunder of or from the obligations, covenants, conditions and agreements by
said lessor to be done and performed; and Trustor does expressly release,
relinquish and surrender unto Beneficiary all of its rights, power and
authority to cancel, surrender, amend, modify or alter in any way the terms and
provisions of the Subject Leases and any attempt on the part of Trustor to
exercise any such right without the written approval and consent of Beneficiary
thereto being first had and obtained shall constitute an Event of Default under
the terms hereof and the Loan Documents and all Obligations and other sums
secured hereby shall, at the option of Beneficiary, become due and payable
forthwith.  Notwithstanding anything
contained herein or in any Loan Document to the contrary, (i) Trustor shall
have the right to amend and modify the Walgreens Lease to consent to Walgreens
Landlord’s development of Parcel 1 (as defined in the Walgreens Lease) and (ii)
such amendment and the waiver of Trustor’s rights with respect to the
development of Parcel 1 shall neither be deemed a “material amendment” nor a
“material right”, in each case, under Section 6.12(C) of the Construction Loan
Agreement.


 


(c)  The Notes and all other Obligations of
Trustor to Beneficiary under the Loan Documents shall immediately become due
and payable at the option of Beneficiary, if Trustor fails to give Beneficiary
immediate notice of any default under the Subject Leases or of the receipt by
it of any notice of default from the Lessor thereunder, or if Trustor fails to
furnish to Beneficiary immediately any and all information which it may request
concerning the performance by Trustor of the covenants of the Subject Leases,
or if Trustor fails to permit Beneficiary or its representative at all
reasonable times to make investigation or examination concerning the
performance by Trustor of the covenants of the Subject Leases, or if Trustor
fails to permit Beneficiary or its representative at all reasonable time to
make investigation or examination concerning such performance.  Trustor shall deliver to Beneficiary an
original executed copy of each Subject Lease, an estoppel certificate from the
Lessor within ten (10) days of request by Beneficiary and in such form and
content as shall be satisfactory to Beneficiary, as well as any and all
documentary evidence received by it showing compliance by Trustor with the
provisions of the Subject Leases.


 


(d)  In the event of any failure by Trustor to
perform or cause the performance of any covenant on the part of lessor or
lessee to be observed and performed under the Subject Leases, the performance
by Beneficiary on behalf of Trustor of the applicable Subject Lease covenant
shall not remove or waive, as between Trustor and Beneficiary, the
corresponding Event of Default under the terms hereof and any amount so advanced
by Beneficiary or any costs incurred


 


17





















 


in connection therewith,
with interest thereon at the Default Rate shall constitute additional
Obligations secured hereby and be immediately due and payable.


 


(e)  To the extent permitted by law, the price
payable by Trustor, or by any other party so entitled, in the exercise of the
right of redemption, if any, shall include all rents paid and other sums
advanced by Beneficiary, on behalf of Trustor, as lessee under the Subject
Leases.


 


(f)  The fee title and the leasehold estate in the
property demised by the Phase II Mall Lease shall not merge and shall always be
kept separate and distinct until the Phase II Mall Lease terminates.  The fee title and the leasehold estate in the
property demised by the Walgreens Lease shall not merge and shall always be
kept separate and distinct until the Walgreens Lease terminates.  The fee title and the leasehold estate in the
property demised by the Master Lease shall not merge and shall always be kept
separate and distinct until the Master Lease terminates.  If Trustor acquires the fee title or any
other estate, title or interest in the Leased Premises or any property covered
by the Subject Leases, the lien of this Deed of Trust shall attach to, cover
and be a lien upon such acquired estate, title or interest and same shall
thereupon be and become a part of the Trust Estate with the same force and
effect as if specifically encumbered herein. 
Trustor covenants and agrees to ratify, confirm and further evidence
Beneficiary’s lien on the acquired estate, title or interest as reasonably
requested by Beneficiary.


 


(g)  Beneficiary shall have the right upon notice
to Trustor to participate in the adjustment and settlement of any insurance
proceeds and in the determination of any condemnation award under the Subject
Leases to the extent and in the manner provided in the Subject Leases.


 


(h)  The Lien of this Deed of Trust shall attach
to all of Trustor’s rights and remedies at any time arising under or pursuant
to Section 365(h) of the Bankruptcy Code, including, without limitation, all of
Trustor’s rights to remain in possession of the Phase II Mall, the Phase II
Mall Improvements and the Leased Premises. 
Trustor shall not elect to treat the Subject Leases as terminated under
Section 365(h)(1) of the Bankruptcy Code, and any such election shall be void.


 


(i)  If pursuant to Section 365(h)(2) of the
Bankruptcy Code, Trustor shall seek to offset against the rent reserved in the
Subject Leases the amount of any damages caused by the nonperformance by the
lessor or any other Person of any of their respective obligations thereunder
after the rejection by the lessor or such other Person of the Subject Leases
under the Bankruptcy Code, then Trustor shall, prior to effecting such offset,
notify Beneficiary of its intent to do so, setting forth the amount proposed to
be so offset and the basis therefor. 
Beneficiary shall have the right to object to all or any part of such
offset that, in the reasonable judgment of Beneficiary, would constitute a
breach of the Subject Leases, and in the event of such objection, Trustor shall
not effect any offset of the amounts found objectionable by Beneficiary.  Neither Beneficiary’s failure to object as
aforesaid nor any objection relating to such offset shall constitute an
approval of any such offset by Beneficiary.


 


(ii)  If any
action, proceeding, motion or notice shall be commenced or filed in respect of
the lessor under the Subject Leases or any other party or in respect of the
Subject Leases in connection with any case under the Bankruptcy Code, then
Beneficiary shall have


 


18





















 


the option to intervene in any
such litigation with counsel of Beneficiary’s choice.  Beneficiary may proceed in its own name in
connection with any such litigation, and Trustor agrees to execute any and all
powers, authoriza­tions, consents or other documents required by Beneficiary in
connection therewith.


 


(iii)  Trustor
shall, after obtaining knowledge thereof, promptly notify Beneficiary of any
filing by or against the lessor or other party with an interest in the Leased
Premises of a petition under the Bankruptcy Code.  Trustor shall promptly deliver to
Beneficiary, following receipt, copies of any and all notices, summonses,
pleadings, applications and other documents received by Trustor in connection
with any such petition and any proceedings relating thereto.


 


(iv)  If there
shall be filed by or against Trustor a petition under the Bankruptcy Code, and
Trustor, as lessee under the Subject Leases, shall determine to reject the
Subject Leases pursuant to Section 365(a) of the Bankruptcy Code, then Trustor
shall give Beneficiary a notice of the date on which Trustor shall apply to the
bankruptcy court for authority to reject the Subject Leases (such notice to be
no later than twenty (20) days prior to such date).  Beneficiary shall have the right, but not the
obligation, to serve upon Trustor at any time prior to the date on which
Trustor shall so apply to the bankruptcy court a notice stating that
Beneficiary demands that Trustor assume and assign the Subject Leases to
Beneficiary pursuant to Section 365 of the Bankruptcy Code.  If Beneficiary shall serve upon Trustor the
notice described in the preceding sentence, to the extent permitted by law
Trustor shall not seek to reject the Subject Leases and shall comply with the
demand provided for in the preceding sentence. 
In addition, effective upon the entry of an order for relief with respect
to Trustor under the Bankruptcy Code, Trustor hereby assigns and transfers to
Beneficiary a non-exclusive right to apply to the bankruptcy court under
Section 365(d)(4) of the Bankruptcy Code for an order extending the period
during which the Subject Leases may be rejected or assumed; and shall (a)
promptly notify Beneficiary of any default by Trustor in the performance or
observance of any of the terms, covenants or conditions on the part of Trustor
to be performed or observed under the Subject Leases and of the giving of any
written notice by the lessor thereunder to Trustor of any such default, and (b)
promptly cause a copy of each written notice given to Trustor by the lessor
under the Subject Leases to be delivered to Beneficiary.  Beneficiary may rely on any notice received
by it from any such lessor of any default by Trustor under the Subject Leases
and may take such action as may be permitted by law to cure such default even
though the existence of such default or the nature thereof shall be questioned
or denied by Trustor or by any Person on its behalf.


 


1.6  Compliance with Legal Requirements.  Trustor shall promptly, fully, and faithfully
comply in all material respects with all Legal Requirements and shall cause all
portions of the Trust Estate and its use and occupancy to fully comply in all
material respects with Legal Requirements at all times, whether or not such
compliance requires work or remedial measures that are ordinary or
extraordinary, foreseen or unforeseen, structural or nonstructural, or that
interfere with the use or enjoyment of the Trust Estate.


 


1.7  Impositions. 
Except as otherwise permitted by Section 5.3 of the Construction
Loan Agreement, (a) Trustor shall pay all Impositions as they become due
and payable and shall


 


19





















 


deliver to Beneficiary promptly upon Beneficiary’s request, evidence
satisfactory to Beneficiary that the Impositions have been paid or are not
delinquent; (b) Trustor shall not suffer to exist, permit or initiate the
joint assessment of the real and personal property, or any other procedure
whereby the Lien of Impositions and the Lien of the personal property taxes
shall be assessed, levied or charged to the Phase II Mall and the Phase II Mall
Improvements as a single Lien, except as may be required by Legal Requirements;
and (c) in the event of the passage of any law deducting from the value of
real property for the purposes of taxation any Lien thereon, or changing in any
way the taxation of deeds of trust or obligations secured thereby for state or
local purposes, or the manner of collecting such Impositions or taxes and
imposing an Imposition or tax, either directly or indirectly, on this Deed of
Trust or the Notes, Trustor shall pay all such Impositions and taxes and all
payments required with respect to Impositions and taxes pursuant to the terms
of the Cooperation Agreement (if, as and when applicable to the Phase II
Project including, without limitation, Article VI thereof).


 


1.8  Insurance.


 


(a)  Insurance Requirements and Proceeds.


 


(i)  Hazard Insurance.  Trustor shall at its sole expense obtain for,
deliver to, assign and maintain for the benefit of Beneficiary, during the term
of this Deed of Trust, insurance policies insuring the Trust Estate and liability
insurance policies, all in accordance with the requirements of Section 5.4
of the Construction Loan Agreement, if applicable, and Article X of the
Cooperation Agreement (if, as and when applicable to the Phase II Project).  Trustor shall promptly pay when due any
premiums on such insurance policies and on any renewals thereof and all
payments required with respect to the procurement of insurance pursuant to the
terms of the Cooperation Agreement (if, as and when applicable to the Phase II
Project including, without limitation, Article VI thereof).  In the event of the foreclosure of this Deed
of Trust or any other transfer of title to the Trust Estate in extinguishment
of the Obligations and other sums secured hereby, all right, title and interest
of Beneficiary in and to all insurance policies and renewals thereof then in
force shall pass to the purchaser or grantee.


 


(ii)  Handling of Proceeds.  All Proceeds from any insurance policies
shall be disbursed in accordance with the provisions of Section 5.4 of the
Construction Loan Agreement, if applicable, or otherwise in accordance with
Articles X and XI of the Cooperation Agreement if, as and when applicable
to the Phase II Project.  All Proceeds of
insurance allocable to Trustor, as owner of the Phase II Mall and the Phase II
Mall Improvements and attributable to business interruption insurance shall be
collected, held, handled and disbursed in accordance with Section 5.4 of
the Construction Loan Agreement, if applicable, or otherwise in accordance with
Articles X and XI of the Cooperation Agreement if, as and when applicable
to the Phase II Project.  All Net Loss
Proceeds shall be applied by Trustor in accordance with Section 2.4A(iii)(b) of
the Construction Loan Agreement.


 


(b)  Compliance with Insurance Policies.  Trustor shall not violate or permit to be
violated any of the conditions or provisions of any policy of insurance
required by the Construction Loan Agreement, the Cooperation Agreement (if, as
and when applicable to the


 


20





















 


Phase II Project) or this Deed of Trust and Trustor shall so perform
and satisfy the requirements of the companies writing such policies that, at
all times, companies of good standing shall be willing to write and/or continue
such insurance.  Trustor further
covenants to promptly send to Beneficiary all notices relating to any violation
of such policies or otherwise affecting Trustor’s insurance coverage or ability
to obtain and maintain such insurance coverage.


 


1.9  Condemnation.  Beneficiary is hereby authorized, at its
option, to commence, appear in and prosecute in its own or Trustor’s name any
action or proceeding relating to any condemnation and, subject to
Article XII of the Cooperation Agreement (if, as and when applicable to
the Phase II Project), to settle or compromise any claim in connection
therewith, and Trustor hereby appoints Beneficiary as its attorney-in-fact
to take any action in Trustor’s name pursuant to Beneficiary’s rights
hereunder.  Immediately upon obtaining
knowledge of the institution of any proceedings for the condemnation of the
Trust Estate, or any portion thereof, Trustor shall notify the  Trustee and Beneficiary of the pendency of such
proceedings.  Trustor from time to time
shall execute and deliver to Beneficiary all instruments requested by it to
permit such participation; provided, however, that such
instruments shall be deemed as supplemental to the foregoing grant of
permission to Trustee and Beneficiary, and unless otherwise required, the foregoing
permission shall, without more, be deemed sufficient to permit Trustee and/or
Beneficiary to participate in such proceedings on behalf of Trustor.  All such compensation awards, damages,
claims, rights of action and Proceeds, and any other payments or relief, and
the right thereto, whether paid to Beneficiary or Trustor, are included in the
Trust Estate.  Beneficiary, after
deducting therefrom all its expenses, including reasonable attorneys fees,
shall apply all Proceeds paid directly to it in accordance with the provisions
of Section 5.4(C) of the Construction Loan Agreement.  All such Proceeds paid directly to the
Trustor shall be applied by Trustor in accordance with Article XII of the
Cooperation Agreement (if, as and when applicable to the Phase II Project) and
Section 2.4A(iii)(c) of the Construction Loan Agreement.  Trustor hereby waives any rights it may have
under NRS 37.115, as amended or recodified from time to time.


 


1.10  Space Leases.


 


(a)  Trustor represents and warrants that:


 


(i)  Trustor has delivered to Beneficiary true,
correct and complete copies of all Space Leases, including all amendments and
modifications, written or oral existing as of the Closing Date;


 


(ii)  Trustor has not executed or entered into any
modifications or amendments of the Space Leases, either orally or in writing,
other than written amendments that have been delivered or disclosed to
Beneficiary in writing;


 


(iii)  to Trustor’s knowledge, no default now exists
under any Space Lease on the part of Trustor or the tenant thereunder;


 


(iv)  to Trustor’s knowledge, no event has occurred
that, with the giving of notice or the passage of time or both, would
constitute such a default or would entitle Trustor or


 


21





















 


any other party under such Space Lease to cancel the
same or otherwise avoid its obligations;


 


(v)  Trustor has not accepted prepayments of
installments of Rent under any Space Leases, except for installment payments
not in excess of one month’s Rent and security deposits;


 


(vi)  except for Permitted Liens, Trustor has not
executed any assignment or pledge of any of Space Leases, the Rents, or of
Trustor’s right, title and interest in the same; and


 


(vii)  this Deed of Trust does not constitute a
violation or default under any Space Lease, and is and shall at all times
constitute a valid Lien on Trustor’s interests in the Space Leases.


 


(b)  After an Event of Default, Trustor shall
deliver to Beneficiary the executed originals of all Space Leases.


 


1.11  Authorization by Trustor.


 


Trustor agrees that in the event the ownership of the
Trust Estate or any part thereof becomes vested in a person other than Trustor,
Beneficiary may, without notice to Trustor, deal in any way with such successor
or successors in interest with reference to this Deed of Trust, the Notes and
other Obligations hereby secured without in any way vitiating or discharging
Trustor’s or any guarantor’s, surety’s or endorser’s liability hereunder or
upon the obligations hereby secured.  No
sale of the Trust Estate and no forbearance to any person with respect to this
Deed of Trust and no extension to any person of the time for payment of the
Notes, and other sums hereby secured given by Beneficiary shall operate to
release, discharge, modify, change or affect the original liability of Trustor,
or such guarantor, surety or endorser either in whole or in part.


 


1.12  Security
Agreement and Financing Statements. 
Trustor (as debtor) hereby grants to Beneficiary (as creditor and
secured party) a present and future security interest in all Tangible
Collateral, Intangible Collateral, FF&E, the Phase II Mall Space, the Phase
II Mall Improvements, the Phase II Mall Sale Agreement, the Phase II Mall Sale
Agreement Proceeds, all other personal property now or hereafter owned or
leased by Trustor or in which Trustor has or will have any interest, to the
extent that such property constitutes a part of the Trust Estate (whether or
not such items are stored on the Site, the Phase II Project, the Phase II Mall
or elsewhere), Proceeds of the foregoing comprising a portion of the Trust
Estate and all proceeds of insurance policies and consideration awards arising
therefrom and all proceeds, products, substitutions, and accessions therefor
and thereto, subject to Beneficiary’s rights to treat such property as real
property as herein provided (collectively, the “Personal
Property”).  Trustor shall
execute any and all documents and writings, including without limitation
financing statements pursuant to the UCC, as may be necessary or prudent to
preserve and maintain the priority of the security interest granted hereby on
property which may be deemed subject to the foregoing security agreement or as
Beneficiary may reasonably request, and shall pay to Beneficiary on demand any
reasonable expenses incurred by Beneficiary in connection with the preparation,
execution and filing of any such documents. 
Trustor hereby authorizes and


 


22





















 


empowers Beneficiary to execute and file, on Trustor’s behalf, all
financing statements and refilings and continuations thereof as advisable to
create, preserve and protect said security interest.  This Deed of Trust constitutes both a real
property deed of trust and a “security agreement,” within the meaning of the
UCC, and the Trust Estate includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of
Trustor in the Trust Estate.  Trustor by
executing and delivering this Deed of Trust has granted to Beneficiary, as
security of the Obligations, a security interest in the Trust Estate.


 


(a)  Fixture Filing.  Without in any way limiting the generality of
the immediately preceding paragraph or of the definition of the Trust Estate,
this Deed of Trust constitutes a fixture filing under Section 9-502 of
the UCC (NRS 104.9502(3)).  For such
purposes, (i) the “debtor” is each Trustor and their respective addresses are
the addresses given for each such Person in the initial paragraph of this Deed
of Trust; (ii) the “secured party” is Beneficiary, and its address for the
purpose of obtaining information is the address given for it in the initial
paragraph of this Deed of Trust; (iii) the real estate to which the fixtures
are or are to become attached is Trustor’s interest in the Phase II Mall and
the Phase II Mall Improvements; and (iv) the record owner of the Phase II Mall
and the Phase II Mall Improvements is Phase II Mall Subsidiary (as the lessor
with respect to the leasehold estates created by the Subject Leases).


 


(b)  Remedies.  This Deed of Trust shall be deemed a security
agreement as defined in the UCC and the remedies for any violation of the
covenants, terms and conditions of the agreements herein contained shall
include any or all of (i) those prescribed herein, and (ii) those
available under applicable Legal Requirements, and (iii) those available
under the UCC, all at Beneficiary’s sole election.  In addition, a photographic or other
reproduction of this Deed of Trust shall be sufficient as a financing statement
for filing wherever filing may be necessary to perfect or continue the security
interest granted herein.


 


(c)  Derogation of Real Property.  It is the intention of the parties that the
filing of a financing statement in the records normally having to do with
personal property shall never be construed as in anyway derogating from or
impairing the express declaration and intention of the parties hereto as
hereinabove stated that everything used in connection with the production of
Income from the Trust Estate and/or adapted for use therein and/or which is
described or reflected in this Deed of Trust is, and at all times and for all
purposes and in all proceedings both legal or equitable, shall be regarded as
part of the real property encumbered by this Deed of Trust irrespective of
whether (i) any such item is physically attached to the Phase II Mall
Improvements, (ii) serial numbers are used for the better identification
of certain equipment items capable of being thus identified in a recital
contained herein or in any list filed with Beneficiary, or (iii) any such
item is referred to or reflected in any such financing statement so filed at
any time.  It is the intention of the
parties that the mention in any such financing statement of (1) rights in
or to the proceeds of any fire and/or hazard insurance policy, or (2) any
award in eminent domain proceedings for a taking or for loss of value, or
(3) Trustor’s interest as lessors in any present or future Space Lease or
rights to Rents, shall never be construed as in anyway altering any of the
rights of Beneficiary as determined by this Deed of Trust or impugning the
priority of Beneficiary’s real property Lien granted hereby or by any other
recorded document, but such mention in the financing statement is declared to
be for the protection of Beneficiary in the event any court or judge shall at
any time hold with respect to the matters set forth in the foregoing clauses (1),
(2) and (3) that notice of Beneficiary’s priority of


 


23





















 


interest to be effective against a particular class of Persons,
including but not limited to, the federal government and any subdivisions or
entity of the federal government, must be filed in the UCC records.


 


(d)  Priority; Permitted Financing of Tangible
Collateral.  All Personal Property of
any nature whatsoever which is subject to the provisions of this security
agreement shall be purchased or obtained by Trustor in its name and free and
clear of any Lien or encumbrance, except for Permitted Liens, for use only in
connection with the business and operation of the Phase II Mall and the Phase
II Mall Improvements, and shall be and at all times remain free and clear of
any lease or similar arrangement, chattel financing, installment sale
agreement, security agreement and any encumbrance of like kind, so that
Beneficiary’s security interest shall attach to and vest in Trustor for the
benefit of Beneficiary, with the priority herein specified, immediately upon
the installation or use of the Personal Property at the Phase II Mall or the
Phase II Mall Improvements and Trustor warrants and represents that
Beneficiary’s security interest in the Personal Property is a validly attached
and binding security interest, properly perfected and prior to all other
security interests therein subject to Permitted Liens.


 


(e)  Preservation of Contractual Rights of
Collateral.  Trustor shall, prior to
delinquency, default, or forfeiture, perform all obligations and satisfy all
material conditions required on its part to be satisfied to preserve its rights
and privileges under any contract, lease, license, permit, or other
authorization (i) under which it holds any Tangible Collateral or
(ii) which constitutes part of the Intangible Collateral, except where
Trustor is contesting such obligations in accordance with the Construction Loan
Agreement.


 


(f)  Removal of Collateral.  Except as permitted in the Construction Loan
Agreement for damaged or obsolete Tangible Collateral which is either no longer
usable or which is removed temporarily for repair or improvement or removed for
replacement on the Trust Estate with Tangible Collateral of similar function or
as otherwise permitted herein, none of the Tangible Collateral shall be removed
from the Trust Estate without Beneficiary’s prior written consent.


 


(g)  Change of Name.  Trustor shall not change its corporate or
business name, or do business within the State under any name other than such
name, or any trade name(s) other than those as to which Trustor gives prior
written notice to Beneficiary of its intent to use such trade names, or any
other business names (if any) specified in the financing statements delivered
to Beneficiary for filing in connection with the execution hereof, without
providing Beneficiary with the additional financing statement(s) and any other
similar documents deemed reasonably necessary by Beneficiary to assure that its
security interest remains perfected and of undiminished priority in all such
Personal Property notwithstanding such name change.


 


1.13  Assignment
of Rents and Leases.  The
assignment of Rents and Leases set out above in Granting Clause (G)
shall constitute an absolute and present assignment to Beneficiary, subject to
the revocable license granted therein to Trustor to collect the Rents, and
shall be fully operative without any further action on the part of any party,
and specifically upon the occurrence of an Event of Default such license shall
be automatically revoked and Beneficiary shall be entitled upon the occurrence
of an Event of Default hereunder to all Rents and to enter into the Phase II
Mall and the Phase II Mall Improvements to collect all such Rents until such
time as such Event of Default is cured and such cure is accepted by the
Beneficiary; provided,


 


24





















 


however,
that Beneficiary shall not be obligated to take possession of the Trust Estate,
or any portion thereof.  The absolute
assignment contained in Granting Clause (G) shall not be deemed to
impose upon Beneficiary any of the obligations or duties of Trustor provided in
any such Space Lease or the Subject Leases (including, without limitation, any
liability under the covenant of quiet enjoyment contained in any Space Lease in
the event that any lessee shall have been joined as a party defendant in any
action to foreclose this Deed of Trust and shall have been barred and
foreclosed thereby of all right, title and interest and equity of redemption in
the Trust Estate or any part thereof).


 


1.14  Rejection of Subject Leases.  To
the extent applicable, if the lessor under the Subject Leases rejects
or disaffirms the Subject Leases or purports or seeks to disaffirm the Subject Leases pursuant to any Bankruptcy Law, then:


 


(a)  To the extent permitted by law, Trustor shall
remain in possession of the Leased Premises and shall perform all acts
reasonably necessary for Trustor to remain in such possession for the unexpired
term of such Subject Leases
(including all renewals), whether the then existing terms and provisions of
such Subject Leases require such
acts or otherwise; and


 


(b)  All the terms and provisions of this Deed of
Trust and the Lien created by this Deed of Trust shall remain in full force and
effect and shall extend automatically to all of Trustor’s rights and remedies
arising at any time under, or pursuant to, Section 365(h) of the
Bankruptcy Code, including all of Trustor’s rights to remain in possession of
the Leased Premises.


 


1.15  Beneficiary’s
Cure of Trustor’s Default.  If
Trustor defaults hereunder in the payment of any tax, assessment, Lien,
encumbrance or other Imposition, in its obligation to furnish insurance
hereunder, or in the performance or observance of any other covenant, condition
or term of this Deed of Trust or the Cooperation Agreement (if, as and when
applicable to the Phase II Project), Beneficiary may, but is not obligated to,
preserve its interest in the Trust Estate, perform or observe the same, but
only upon not less than five (5) Business Days notice to Trustor and all payments
made (whether such payments are regular or accelerated payments) and reasonable
costs and expenses incurred or paid by Beneficiary in connection therewith
shall become due and payable immediately. 
The amounts so incurred or paid by Beneficiary, together with interest
thereon at the Default Rate from the date incurred until paid by Trustor, shall
be added to the Obligations and secured by the Lien of this Deed of Trust.  Beneficiary is hereby empowered to enter and
to authorize others to enter upon the Phase II Mall or the Phase II Mall
Improvements or any part thereof for the purpose of performing or observing any
such defaulted covenant, condition or term, without thereby becoming liable to
Trustor or any Person in possession holding under Trustor.  No exercise of any rights under this Section 1.15
by Beneficiary shall cure or waive any Event of Default or notice of default
hereunder or invalidate any act done pursuant hereto or to any such notice, but
shall be cumulative of all other rights and remedies.


 


1.16  Use of Land and Leased Premises.  Trustor covenants that the Trust Estate shall
be (i) used and operated in a manner reasonably consistent with the description
of the Phase II Mall in the Cooperation Agreement (if, as and when applicable
to the Phase II Project) and (ii) Section 6.11 of the Construction Loan
Agreement.


 


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1.17  Affiliates
and Subsidiaries.


 


(a)  Subject to Trust Deed.  Subject to compliance with requirements of
applicable Nevada Gaming Laws, Trustor shall cause all of its Affiliates and
Subsidiaries in any way involved with the operation of all or a portion of the
Trust Estate to observe the covenants and conditions of this Deed of Trust to
the extent necessary to give the full intended effect to such covenants and
conditions and to protect and preserve the security of Beneficiary hereunder.  Trustor shall, at Beneficiary’s request,
cause any such Affiliate or Subsidiary to execute and deliver to Beneficiary or
Trustee such further instruments or documents as Beneficiary may reasonably
deem necessary to effectuate the terms of this Section 1.17(a).


 


(b)  Restriction on Use of Subsidiary or Affiliate.  Except as permitted under the Construction
Loan Agreement or the Loan Documents, Trustor shall not use any Affiliate or
Subsidiary in the operation of the Trust Estate, the Phase II Mall, the Leased
Premises or the Easements if such use would in any way impair the security for
the Notes and the Construction Loan Agreement or cause a breach of any covenant
of this Deed of Trust, the Construction Loan Agreement or any other Loan
Documents.


 


1.18  Merger.  So long
as any of the Obligations have not been paid or performed, unless Beneficiary
shall otherwise in writing consent, the fee title and the leasehold estate
under the Subject Leases shall not merge but shall always be kept separate and
distinct, notwithstanding the union of said estates either in the lessor or in
the lessee, or in a third party, by purchase or otherwise; and Trustor
covenants and agrees that, if it shall acquire the fee title, or any other
estate, title or interest in any portion of the Lease Premises, this Deed of
Trust shall be considered as mortgaged, assigned or conveyed to the Beneficiary
and the Lien hereof spread to cover such estate with the same force and effect
as though specifically herein mortgaged, assigned or conveyed and spread.  The provisions of this paragraph shall not
apply if Beneficiary shall so elect.


 


ARTICLE TWO



CORPORATE LOAN PROVISIONS


 


2.1  Interaction with Construction Loan
Agreement.


 


(a)  Incorporation by Reference.  All terms, covenants, conditions, provisions
and requirements of the Construction Loan Agreement are incorporated by
reference in this Deed of Trust.


 


(b)  Conflicts. 
In the event of any conflict or inconsistency between the provisions of
this Deed of Trust and those of the Construction Loan Agreement, the provisions
of the Construction Loan Agreement shall govern.


 


2.2  Other Collateral.  This Deed of Trust is one of a number of Collateral Documents to
secure the Obligations delivered by or on behalf of Trustor pursuant to the
Construction Loan Agreement and the other Loan Documents and securing the
Obligations secured hereunder.  All
potential junior Lien claimants are placed on notice that, under any of the
Loan Documents and any other documents granting a security interest to the
Beneficiary or otherwise (such as by


 


26






















 


separate future unrecorded agreement between Trustor and Beneficiary),
other collateral for the Obligations secured hereunder (i.e.,
collateral other than the Trust Estate) may, under certain circumstances, be
released without a corresponding reduction in the total principal amount
secured by this Deed of Trust.  Such a
release would decrease the amount of collateral securing the Obligations, thereby
increasing the burden on the remaining Trust Estate created and continued by
this Deed of Trust.  No such release
shall impair the priority of the Lien of this Deed of Trust.  By accepting its interest in the Trust
Estate, each and every junior Lien claimant shall be deemed to have acknowledged
the possibility of, and consented to, any such release.  Nothing in this paragraph shall impose any
obligation upon Beneficiary.


 


ARTICLE THREE



DEFAULTS


 


3.1  Event of Default.  The term “Event of Default,” wherever used in this
Deed of Trust, shall mean any one or more of the events of default listed in
Section 7 of the Construction Loan Agreement (whether any such event shall
be voluntary or involuntary or come about or be effected by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) and
it shall be an Event of Default under this Deed of Trust if Trustor or any
other “borrower” (as defined in NRS 106.310) who may send a notice pursuant to
NRS 106.380(1) with respect to this Deed of Trust (i) delivers, sends or
otherwise gives to Beneficiary (A) any notice of an election to terminate the
operation of this Deed of Trust as security for any indebtedness secured by
this instrument, including, without limitation, any obligation to repay any
“future advance” (as defined in NRS 106.320) or “principal” (as defined in NRS
106.345), or (B) any other notice pursuant to NRS 106.380(1); (ii) records a
statement pursuant to NRS 1206.380(3); or (iii) causes this Deed of Trust, any
indebtedness secured by this instrument or Beneficiary to be subject to NRS
106.380(2), 106.380(3), or 106.400.


 


ARTICLE FOUR



REMEDIES


 


4.1  Acceleration of Maturity.  If an Event of Default occurs, Beneficiary
may (except that such acceleration shall be automatic if the Event of Default
is caused by a Trustor’s Bankruptcy, in accordance with Sections 7.6 and
7.7 of the Construction Loan Agreement) declare the Notes and all Obligations
or sums secured hereby, to be due and payable immediately, and upon such
declaration such principal and interest and other sums shall immediately become
due and payable without demand, presentment, notice or other requirements of
any kind (all of which Trustor waives) notwithstanding anything in this Deed of
Trust or any Loan Document or applicable law to the contrary.


 


4.2  Protective Advances.  If Trustor fails to make any payment or
perform any other obligation under the Notes, the other Operative Documents or
the Resort Complex Operative Documents, then without thereby limiting
Beneficiary’s other rights or remedies, waiving or releasing any of Trustor’s
obligations, or imposing any obligation on Beneficiary, Beneficiary may either
advance any amount owing or perform any or all actions that Beneficiary
considers


 


27






















 


necessary or appropriate to
cure such default.  All such advances
shall constitute “Protective Advances.”  No sums advanced or performance rendered by
Beneficiary shall cure, or be deemed a waiver of any Event of Default.


 


4.3  Institution of Equity Proceedings.  If an Event of Default occurs, Beneficiary
may institute an action, suit or proceeding in equity for specific performance
of this Deed of Trust or the Loan Documents, all of which shall be specifically
enforceable by injunction or other equitable remedy.  Trustor waives any defense based on laches or any applicable
statute of limitations.


 


4.4  Beneficiary’s
Power of Enforcement.


 


(a)  If an Event of Default occurs, Beneficiary
shall be entitled, at its option and in its sole and absolute discretion, to
prepare and record on its own behalf, or to deliver to Trustee for recording,
if appropriate, written declaration of default and demand for sale and written
Notice of Default and Election to Sell (NRS 107.080) (or other statutory
notice) to cause the Trust Estate to be sold to satisfy the obligations hereof,
and in the case of delivery to Trustee, Trustee shall cause said notice to be
filed for record.


 


(b)  After the lapse of such time as may then be
required by law following the recordation of said Notice of Breach and Election
to Sell, and notice of sale having been given as then required by law,
including compliance with all applicable Nevada Gaming Laws, Trustee without demand
on Trustor, shall sell the Trust Estate or any portion thereof at the time and
place fixed by it in said notice, either as a whole or in separate parcels, and
in such order as it may determine, at public auction to the highest bidder, of
cash in lawful money of the United States payable at the time of sale.  Trustee may, for any cause it deems
expedient, postpone the sale of all or any portion of said property until it
shall be completed and, in every case, notice of postponement shall be given by
public announcement thereof at the time and place last appointed for the sale
and from time to time thereafter Trustee may postpone such sale by public
announcement at the time fixed by the preceding postponement.  Trustee shall execute and deliver to the purchaser
its Deed, Bill of Sale, or other instrument conveying said property so sold,
but without any covenant or warranty, express or implied.  The recitals in such instrument of
conveyance of any matters or facts shall be conclusive proof of the truthfulness
thereof.  Any Person, including
Beneficiary, may bid at the sale.


 


(c)  After deducting all costs, fees and expenses
of Trustee and of this Deed of Trust, including, without limitation, costs of
evidence of title and reasonable attorneys’ fees of Trustee or Beneficiary in
connection with a sale, Trustee shall apply the proceeds of such sale to
payment of all sums expended under the terms hereof not then repaid, with
accrued interest at the Default Rate to the payment of all other sums then
secured hereby and the remainder, if any, to the Person or Persons legally
entitled thereto as provided in NRS 40.462.


 


(d)  Subject to compliance with applicable Nevada
Gaming Laws, if any Event of Default occurs, Beneficiary may, either with or
without entry or taking possession of the Trust Estate, and without regard to
whether or not the Obligations and other sums secured hereby shall be due and
without prejudice to the right of Beneficiary thereafter to bring an action or
proceeding to foreclose or any other action for any default existing at the
time such earlier action was


 


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commenced, proceed by any
appropriate action or proceeding: (1) to enforce payment of the Notes, to
the extent permitted by law, or the performance of any term hereof or any other
right; (2) to foreclose this Deed of Trust in any manner provided by law
for the foreclosure of mortgages or deeds of trust on real property and to
sell, as an entirety or in separate lots or parcels, the Trust Estate or any
portion thereof pursuant to applicable Legal Requirements or under the judgment
or decree of a court or courts of competent jurisdiction, and Beneficiary shall
be entitled to recover in any such proceeding all costs and expenses incident
thereto, including reasonable attorneys’ fees in such amount as shall be
awarded by the court; (3) to exercise any or all of the rights and
remedies available to it under the Construction Loan Agreement and the other
Loan Documents; and (4) to pursue any other remedy available to it.  Beneficiary shall take action either by such
proceedings or by the exercise of its powers with respect to entry or taking
possession, or both, as Beneficiary may determine.


 


(e)  The remedies described in this Section 4.4 may be exercised with
respect to all or any portion of the Personal Property, either simultaneously
with the sale of any real property encumbered hereby or independent
thereof.  Beneficiary shall at any time
be permitted to proceed with respect to all or any portion of the Personal
Property in any manner permitted by the UCC. 
Trustor agrees that Beneficiary’s inclusion of all or any portion of the
Personal Property (and all personal property that is subject to a security
interest in favor, or for the benefit, of Beneficiary) in a sale or other
remedy exercised with respect to the real property encumbered hereby, as
permitted by the UCC, is a commercially reasonable disposition of such
property.


 


4.5  Beneficiary’s
Right to Enter and Take Possession, Operate and Apply Income.


 


(a)  Subject to compliance with applicable Nevada
Gaming Laws, if an Event of Default occurs, (i) Trustor, upon demand of
Beneficiary, shall forthwith surrender to Beneficiary the actual possession
and, if and to the extent permitted by law, Beneficiary itself, or by such
officers or agents as it may appoint, may enter and take possession of all the
Trust Estate including the Personal Property, without liability for trespass,
damages or otherwise, and may exclude Trustor and its agents and employees wholly
therefrom and may have joint access with Trustor to the books, papers and
accounts of Trustor; and (ii) Trustor shall pay monthly in advance to
Beneficiary on Beneficiary’s entry into possession, or to any receiver
appointed to collect the Rents, all Rents then due and payable.


 


(b)  If Trustor shall for any reason fail to
surrender or deliver the Trust Estate, the Personal Property or any part
thereof after Beneficiary’s demand, Beneficiary may obtain a judgment or decree
conferring on Beneficiary or Trustee the right to immediate possession or
requiring Trustor to deliver immediate possession of all or part of such
property to Beneficiary or Trustee and Trustor hereby specifically consents to
the entry of such judgment or decree. 
Trustor shall pay to Beneficiary or Trustee, upon demand, all reasonable
costs and expenses of obtaining such judgment or decree and reasonable
compensation to Beneficiary or Trustee, their attorneys and agents, and all
such costs, expenses and compensation shall, until paid, be secured by the Lien
of this Deed of Trust.


 


(c)  Subject to compliance with applicable Nevada
Gaming Laws, upon every such entering upon or taking of possession, Beneficiary
or Trustee may hold, store, use, operate,


 


29






















 


manage and control the
Trust Estate and conduct the business thereof, and, from time to time in its
sole and absolute discretion and without being under any duty to so act:


 


(i)  make all necessary and proper maintenance,
repairs, renewals, replacements, additions, betterments and improvements
thereto and thereon and purchase or otherwise acquire additional fixtures,
personalty and other property;


 


(ii)  insure or keep the Trust Estate insured;


 


(iii)  manage and operate the Trust Estate and
exercise all the rights and powers of Trustor in their name or otherwise with
respect to the same;


 


(iv)  enter into agreements with others to
exercise the powers herein granted Beneficiary or Trustee, all as Beneficiary
or Trustee from time to time may determine; and subject to the absolute
assignment of the Rents and Leases and the Phase II Mall Sale Agreement
Proceeds and the Phase II Mall Sale Agreement, Beneficiary or Trustee may
collect and receive all of the Rents and the Phase II Mall Sale Agreement
Proceeds, including those past due as well as those accruing thereafter; and,
in each case, shall apply the monies so received by Beneficiary or Trustee in
such priority as Beneficiary may determine to (A) the payment of interest
and principal due and payable on the Notes, (B) the deposits for
Impositions and insurance premiums due, (C) the cost of insurance,
Impositions and other proper charges upon the Trust Estate or any part thereof;
(D) the compensation, expenses and disbursements of the agents, attorneys
and other representatives of Beneficiary or Trustee; and (E) any other
charges or costs required to be paid by Trustor under the terms hereof; and


 


(v)  rent or sublet the Trust Estate or any
portion thereof for any purpose permitted by this Deed of Trust.


 


Beneficiary or Trustee shall surrender possession of
the Trust Estate and the Personal Property to Trustor only when all that is due
upon such interest and principal, Imposition and insurance deposits, and all
amounts under any of the terms of the Construction Loan Agreement or this Deed
of Trust, shall have been paid and other Obligations performed.  The same right of taking possession,
however, shall exist if any subsequent Event of Default shall occur and be
continuing.


 


4.6  Space Leases. 
Beneficiary is authorized to foreclose this Deed of Trust subject to the
rights of any tenants of the Trust Estate, and the failure to make any such
tenants parties defendant to any such foreclosure proceedings and to foreclose
their rights shall not be, nor be asserted by Trustor to be, a defense to any
proceedings instituted by Beneficiary to collect the sums secured hereby or to
collect any deficiency remaining unpaid after the foreclosure sale of the Trust
Estate, or any portion thereof.  Unless
otherwise agreed by Beneficiary in writing, all Space Leases executed
subsequent to the date hereof, or any part thereof, shall be subordinate and
inferior to the Lien of this Deed of Trust; provided, however,
from time to time Beneficiary may execute and record among the land records of
the jurisdiction where this Deed of Trust is recorded, subordination statements
with respect to such of said Space Leases as Beneficiary may designate in its
sole discretion, whereby the Space Leases so designated by Beneficiary shall be


 


30






















 


made superior to the Lien of this Deed of Trust for the term set forth
in such subordination statement.  From
and after the recordation of such subordination statements, and for the
respective periods as may be set forth therein, the Space Leases therein
referred to shall be superior to the Lien of this Deed of Trust and shall not
be affected by any foreclosure hereof. 
All such Space Leases shall contain a provision to the effect that the
Trustor and Space Lessee recognize the right of Beneficiary to elect and to
effect such subordination of this Deed of Trust and consents thereto.


 


4.7  Purchase by Beneficiary.  Upon any foreclosure sale (whether judicial
or nonjudicial), Beneficiary may bid for and purchase the property subject to
such sale and, upon compliance with the terms of sale, may hold, retain and
possess and dispose of such property in its own absolute right without further
accountability.


 


4.8  Waiver of Appraisement, Valuation,
Stay, Extension and Redemption Laws. 
Trustor agrees to the full extent permitted by Legal Requirements that
if an Event of Default occurs, neither Trustor nor anyone claiming through or
under it shall or will set up, claim or seek to take advantage of any
appraisement, valuation, stay, extension or redemption laws now or hereafter in
force, in order to prevent or hinder the enforcement or foreclosure of this
Deed of Trust or the absolute sale of the Trust Estate or any portion thereof
or the final and absolute putting into possession thereof, immediately after
such sale, of the purchasers thereof, and Trustor for itself and all who may at
any time claim through or under it, hereby waives, to the full extent that it
may lawfully so do, the benefit of all such Legal Requirements, and any and all
right to have the assets comprising the Trust Estate marshalled upon any
foreclosure of the Lien hereof and agrees that Trustee or any court having
jurisdiction to foreclose such Lien may sell the Trust Estate in part or as an entirety.


 


4.9  Receiver.  If
an Event of Default occurs, Beneficiary, to the extent permitted by law and
subject to compliance with all applicable Nevada Gaming Laws, and without
regard to the value, adequacy or occupancy of the security for the Obligations
and other sums secured hereby, shall be entitled as a matter of right if it so
elects to the appointment of a receiver to enter upon and take possession of
the Trust Estate and to collect all Rents and the Phase II Mall Sale Agreement
Proceeds and apply the same as the court may direct, and such receiver may be
appointed by any court of competent jurisdiction upon application by
Beneficiary.  Beneficiary may have a
receiver appointed without notice to Trustor or any third party, and
Beneficiary may waive any requirement that the receiver post a bond.  Beneficiary shall have the power to
designate and select the Person who shall serve as the receiver and to
negotiate all terms and conditions under which such receiver shall serve.  Any receiver appointed on Beneficiary’s
behalf may be an Affiliate of Beneficiary. 
The expenses, including receiver’s fees, attorneys’ fees, costs and
agent’s compensation, incurred pursuant to the powers herein contained shall be
secured by this Deed of Trust.  The
right to enter and take possession of and to manage and operate the Trust
Estate and to collect all Rents and the Phase II Mall Sale Agreement Proceeds,
whether by a receiver or otherwise, shall be cumulative to any other right or
remedy available to Beneficiary under this Deed of Trust, the Construction Loan
Agreement or otherwise available to Beneficiary and may be exercised
concurrently therewith or independently thereof.  Beneficiary shall be liable to account only for such Rents
(including, without limitation, security deposits) and such Phase II Mall Sale
Agreement Proceeds actually received by Beneficiary, whether received pursuant
to this Section 4.9 or any other provision hereof.  Notwithstanding the


 


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appointment of any receiver or other custodian, Beneficiary shall be
entitled as pledgee to the possession and control of any cash, deposits, or
instruments at the time held by, or payable or deliverable under the terms of
this Deed of Trust to, Beneficiary.


 


4.10  Suits to Protect the Trust Estate.  Beneficiary shall have the power and
authority to institute and maintain any suits and proceedings as Beneficiary,
in its sole and absolute discretion, may deem advisable (a) to prevent any
impairment of the Trust Estate by any acts which may be unlawful or in
violation of this Deed of Trust, (b) to preserve or protect its interest
in the Trust Estate, or (c) to restrain the enforcement of or compliance
with any Legal Requirement that may be unconstitutional or otherwise invalid,
if the enforcement of or compliance with such enactment, rule or order might
impair the security hereunder or be prejudicial to Beneficiary’s interest.


 


4.11  Proofs of Claim. 
In the case of any receivership, Insolvency, Bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceedings affecting
Trustor, or, to the extent the same would result in an Event of Default
hereunder, any Subsidiary, or any guarantor, co-maker or endorser of any
of Trustor’s obligations, its creditors or its property, Beneficiary, to the
extent permitted by law, shall be entitled to file such proofs of claim or
other documents as it may deem to be necessary or advisable in order to have
its claims allowed in such proceedings for the entire amount of the
Obligations, at the date of the institution of such proceedings, and for any
additional amounts which may become due and payable by Trustor after such date.


 


4.12  Trustor
to Pay the Notes on Any Default in Payment; Application of Monies by
Beneficiary.


 


(a)  In case of
a foreclosure sale of all or any part of the Trust Estate and of the
application of the proceeds of sale to the payment of the sums secured hereby,
Beneficiary shall be entitled to enforce payment from Trustor of any additional
amounts then remaining due and unpaid and to recover judgment against Trustor
for any portion thereof remaining unpaid, with interest at the Default Rate in
accordance with Section 4.19 hereof.


 


(b)  Trustor hereby agrees to the extent
permitted by law, that no recovery of any such judgment by Beneficiary or other
action by Beneficiary and no attachment or levy of any execution upon any of
the Trust Estate or any other property shall in any way affect the Lien and
security interest of this Deed of Trust upon the Trust Estate or any part
thereof or any Lien, rights, powers or remedies of Beneficiary hereunder, but
such Lien, rights, powers and remedies shall continue unimpaired as before.


 


4.13  Delay or Omission; No Waiver.  No delay or omission of Beneficiary to
exercise any right, power or remedy upon any Event of Default shall exhaust or
impair any such right, power or remedy or shall be construed to waive any such
Event of Default or to constitute acquiescence therein.  Every right, power and remedy given to Beneficiary
whether contained herein or in the Construction Loan Agreement or otherwise
available to Beneficiary may be exercised from time to time and as often as may
be deemed expedient by Beneficiary.


 


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4.14  No
Waiver of One Default to Affect Another.  No waiver of any Event of Default hereunder shall extend to or
affect any subsequent or any other Event of Default then existing, or impair
any rights, powers or remedies consequent thereon.  If Beneficiary (a) grants forbearance or an extension of
time for the payment of any sums secured hereby; (b) takes other or
additional security for the payment thereof; (c) waives or does not
exercise any right granted in the Notes, the Construction Loan Agreement, this
Deed of Trust or any other Loan Document; (d) releases any part of the
Trust Estate from the Lien or security interest of this Deed of Trust or any
other instrument securing the Notes; (e) consents to the filing of any
map, plat or replat of the Phase II Mall or the Site (to the extent such
consent is required); (f) consents to the granting of any easement on the
Site, the Phase II Mall or the Phase II Mall Improvements (to the extent such
consent is required); or (g) makes or consents to any agreement changing
the terms of this Deed of Trust or any other Loan Document for the benefit of
Beneficiary subordinating the Lien or any charge hereof, no such act or
omission shall release, discharge, modify, change or affect the original
liability under the Notes, this Deed of Trust or any other Loan Document for
the benefit of Beneficiary or otherwise of Trustor, or any subsequent purchaser
of the Trust Estate or any part thereof or any maker, co-signer, surety
or guarantor.  No such act or omission
shall preclude Beneficiary from exercising any right, power or privilege herein
granted or intended to be granted in case of any Event of Default then existing
or of any subsequent Event of Default, nor, except as otherwise expressly
provided in an instrument or instruments executed by Beneficiary, shall the
Lien or security interest of this Deed of Trust be altered thereby, except to
the extent expressly provided in any releases, maps, easements or
subordinations described in clause (d), (e), (f) or (g)
above of this Section 4.14.  In the event of the sale or transfer by
operation of law or otherwise of all or any part of the Trust Estate,
Beneficiary, without notice to any Person is hereby authorized and empowered to
deal with any such vendee or transferee with reference to the Trust Estate or
the Obligations secured hereby, or with reference to any of the terms or
conditions hereof, as fully and to the same extent as it might deal with the
original parties hereto and without in any way releasing or discharging any of the
liabilities or undertakings hereunder, or waiving its right to declare such
sale or transfer an Event of Default as provided herein.  Notwithstanding anything to the contrary
contained in this Deed of Trust or the other Loan Documents, (i) in the
case of any non-monetary Event of Default, Beneficiary may continue to accept
payments due hereunder without thereby waiving the existence of such or any
other Event of Default and (ii) in the case of any monetary Event of
Default, Beneficiary may accept partial payments of any sums due hereunder
without thereby waiving the existence of such Event of Default if the partial
payment is not sufficient to completely cure such Event of Default.


 


4.15  Discontinuance of Proceedings;
Position of Parties Restored.  If Beneficiary
shall have proceeded to enforce any right or remedy under this Deed of Trust by
foreclosure, entry of judgment or otherwise and such proceedings shall have
been discontinued or abandoned for any reason, or such proceedings shall have
resulted in a final determination adverse to Beneficiary, then and in every
such case Trustor and Beneficiary shall be restored to their former positions
and rights hereunder, and all rights, powers and remedies of Beneficiary shall
continue as if no such proceedings had occurred or had been taken.


 


4.16  Remedies Cumulative.  No right, power or remedy, including without
limitation remedies with respect to any security for the Notes, conferred upon
or reserved to Beneficiary by this Deed of Trust or any other Loan Document is
exclusive of any other right, power or remedy, but each and every such right,
power and remedy shall be cumulative and concurrent and shall be


 


33






















 


in addition to any other right, power and remedy given hereunder or
under any Loan Document, now or hereafter existing at law, in equity or by
statute, and Beneficiary shall be entitled to resort to such rights, powers,
remedies or security as Beneficiary shall in its sole and absolute discretion
deem advisable.


 


4.17  Interest After Event of Default.  If an Event of Default shall have occurred
and is continuing, outstanding and unpaid Obligations under the Loan Documents
shall, at Beneficiary’s option, bear interest at the Default Rate until such
Event of Default has been cured. 
Trustor’s obligation to pay such interest shall be secured by this Deed
of Trust and the other Collateral Documents.


 


4.18  Foreclosure; Expenses of Litigation.  If Trustee forecloses, reasonable attorneys’
fees for services in the supervision of said foreclosure proceeding shall be
allowed to the Trustee and Beneficiary as part of the foreclosure costs.  In the event of foreclosure of the Lien
hereof, there shall be allowed and included as additional Obligations all
reasonable expenditures and expenses which may be paid or incurred by or on
behalf of Beneficiary for attorneys’ fees, appraiser’s fees, outlays for
documentary and expert evidence, stenographers’ charges, publication costs, and
costs (which may be estimated as to items to be expended after foreclosure sale
or entry of the decree) of procuring all such abstracts of title, title
searches and examinations, title insurance policies and guarantees, and similar
data and assurances with respect to title as Beneficiary may deem reasonably
advisable either to prosecute such suit or to evidence to a bidder at any sale
which may be had pursuant to such decree the true condition of the title to or
the value of the Trust Estate or any portion thereof.  All expenditures and expenses of the nature in this Section
4.18 mentioned, and such expenses and fees as may be incurred if the
protection of the Trust Estate and the maintenance of the Lien and security
interest of this Deed of Trust, including the fees of any attorney employed by
Beneficiary in any litigation or proceeding affecting this Deed of Trust or any
Loan Document, the Trust Estate or any portion thereof, including, without
limitation, civil, probate, appellate and bankruptcy proceedings, or in
preparation for the commencement or defense of any proceeding or threatened
suit or proceeding, shall be immediately due and payable by Trustor, with
interest thereon at the Default Rate, and shall be secured by this Deed of
Trust and the other Collateral Documents. 
Trustee waives its right to any statutory fee in connection with any
judicial or nonjudicial foreclosure of the Lien hereof and agrees to accept a
reasonable fee for such services.


 


4.19  Deficiency
Judgments.  If after foreclosure
of this Deed of Trust or Trustee’s sale hereunder, there shall remain any
deficiency with respect to any amounts payable under the Notes or hereunder or
any amounts secured hereby, and Beneficiary shall institute any proceedings to
recover such deficiency or deficiencies, all such amounts shall continue to
bear interest at the Default Rate. 
Trustor waives any defense to Beneficiary’s recovery against Trustor of
any deficiency after any foreclosure sale of the Trust Estate.  Trustor expressly waives any defense or
benefits that may be derived from any statute granting Trustor any defense to
any such recovery by Beneficiary.  In
addition, Beneficiary and Trustee shall be entitled to recovery of all of their
reasonable costs and expenditures (including without limitation any court
imposed costs) in connection with such proceedings, including their reasonable
attorneys’ fees, appraisal fees and the other costs, fees and expenditures
referred to in Section 4.18
above.  This provision shall survive any
foreclosure or sale of the Trust Estate, any portion thereof and/or the
extinguishment of the Lien hereof.


 


34






















 


4.20  Waiver of July Trial.  Beneficiary and Trustor each waive any right
to have a jury participate in resolving any dispute whether sounding in contract,
tort or otherwise arising out of, connected with, related to or incidental to
the relationship established between them in connection with the Notes, this
Deed of Trust or any other Loan Document. 
Any such disputes shall be resolved in a bench trial without a jury.


 


4.21  Exculpation of Beneficiary.  The acceptance by Beneficiary of the
assignment contained herein with all of the rights, powers, privileges and
authority created hereby shall not, prior to entry upon and taking possession
of the Trust Estate by Beneficiary, be deemed or construed to make Beneficiary
a “mortgagee in possession”; nor thereafter or at any time or in any event
obligate Beneficiary to appear in or defend any action or proceeding relating
to the Subject Leases, the Space Leases, the Rents, the Phase II Mall Sale
Agreement, the Phase II Mall Sale Agreement Proceeds or the Trust Estate, or to
take any action hereunder or to expend any money or incur any expenses or
perform or discharge any obligation, duty or liability under any Space Lease or
to assume any obligation or responsibility for any security deposits or other
deposits except to the extent such deposits are actually received by
Beneficiary, nor shall Beneficiary, prior to such entry and taking, be liable
in any way for any injury or damage to person or property sustained by any
Person in or about the Trust Estate.


 


ARTICLE FIVE



RIGHTS AND RESPONSIBILITIES OF TRUSTEE;

OTHER PROVISIONS RELATING TO TRUSTEE


 


Notwithstanding anything to the contrary in this Deed
of Trust, Trustor and Beneficiary agree as follows.


 


5.1  Exercise of Remedies by Trustee.  To the extent that this Deed of Trust or
applicable law, including all applicable Nevada Gaming Laws, authorizes or
empowers, or does not require approval for, Beneficiary to exercise any
remedies set forth in Article 4 hereof or otherwise, or perform any
acts in connection therewith, Trustee (but not to the exclusion of Beneficiary
unless so required under the law of the State) shall have the power to exercise
any or all such remedies, and to perform any acts provided for in this Deed of
Trust in connection therewith, all for the benefit of Beneficiary and on
Beneficiary’s behalf in accordance with applicable law of the State.  In connection therewith, Trustee:
(a) shall not exercise, or waive the exercise of, any Beneficiary’s
remedies (other than any rights of Trustee to any indemnity or reimbursement),
except at Beneficiary’s request, and (b) shall exercise, or waive the
exercise of, any or all of Beneficiary’s remedies at Beneficiary’s request, and
in accordance with Beneficiary’s directions as to the manner of such exercise
or waiver.  Trustee may, however,
decline to follow Beneficiary’s request or direction if Trustee shall be
advised by counsel that the action or proceeding, or manner thereof, so
directed may not lawfully be taken or waived.


 


5.2  Rights and Privileges of Trustee.  To the extent that this Deed of Trust
requires Trustor to indemnify Beneficiary or reimburse Beneficiary for any
expenditures Beneficiary may incur, Trustee shall be entitled to the same
indemnity and the same rights to reimbursement of expenses as Beneficiary,
subject to such limitations and conditions as would apply in the case of
Beneficiary.  To the extent that this
Deed of Trust negates or limits Beneficiary’s liability as to


 


35






















 


any matter, Trustee shall be entitled to the same negation or
limitation of liability.  To the extent
that Trustor, pursuant to this Deed of Trust, appoints Beneficiary as Trustor’s
attorney in fact for any purpose, Beneficiary or (when so instructed by
Beneficiary) Trustee shall be entitled to act on Trustor’s behalf without
joinder or confirmation by the other.


 


5.3  Resignation or Replacement of Trustee.  Trustee may resign by an instrument in
writing addressed to Beneficiary, and Trustee may be removed at any time with
or without cause (i.e., in Beneficiary’s sole and absolute discretion)
by an instrument in writing executed by Beneficiary.  In case of the death, resignation, removal or disqualification of
Trustee or if for any reason Beneficiary shall deem it desirable to appoint a
substitute, successor or replacement Trustee to act instead of Trustee
originally named (or in place of any substitute, successor or replacement
Trustee), then Beneficiary shall have the right and is hereby authorized and
empowered to appoint a successor, substitute or replacement Trustee, without
any formality other than appointment and designation in writing executed by
Beneficiary, which instrument shall be recorded if required by the law of the
State.  The laws of the State
(including, without limitation, the Nevada Gaming Laws) shall govern the
qualification of any Trustee.  The
authority conferred upon Trustee by this Deed of Trust shall automatically
extend to any and all other successor, substitute and replacement Trustee(s)
successively until the obligations secured hereunder have been paid in full or
the Trust Estate has been sold hereunder or released in accordance with the
provisions of the Loan Documents to which the Beneficiary is a party or which
grants a security for the benefit of the Beneficiary.  Beneficiary’s written appointment and designation of any Trustee
shall be full evidence of Beneficiary’s right and authority to make the same
and of all facts therein recited.  No
confirmation, authorization, approval or other action by Trustor shall be
required in connection with any resignation or other replacement of Trustee.


 


5.4  Authority of Beneficiary.  If Beneficiary is a banking corporation,
state banking corporation or a national banking association and the instrument
of appointment of any successor or replacement Trustee is executed on
Beneficiary’s behalf by an officer of such corporation, state banking
corporation or national banking association, then such appointment shall be
conclusively presumed to be executed with authority and shall be valid and
sufficient without proof of any action by the board of directors or any
superior officer of Beneficiary.


 


5.5  Effect of Appointment of Successor
Trustee.  Upon the appointment
and designation of any successor, substitute or replacement Trustee, and
subject to compliance with applicable Nevada Gaming Laws and other applicable
Legal Requirements, Trustee’s entire estate and title in the Trust Estate shall
vest in the designated successor, substitute or replacement Trustee.  Such successor, substitute or replacement
Trustee shall thereupon succeed to and shall hold, possess and execute all the
rights, powers, privileges, immunities and duties herein conferred upon
Trustee.  All references herein to
Trustee shall be deemed to refer to Trustee (including any successor or
substitute appointed and designated as herein provided) from time to time acting
hereunder.


 


5.6  Confirmation of Transfer and
Succession.  Upon the written
request of Beneficiary or of any successor, substitute or replacement Trustee,
any former Trustee ceasing to act shall execute and deliver an instrument
transferring to such successor, substitute or replacement Trustee all of the
right, title, estate and interest in the Trust Estate of Trustee so ceasing to
act, together with all the rights, powers, privileges, immunities and duties
herein conferred upon


 


36






















 


Trustee, and shall duly assign, transfer and deliver all properties and
moneys held by said Trustee hereunder to said successor, substitute or
replacement Trustee.


 


5.7  Exculpation. 
Trustee shall not be liable for any error of judgment or act done by
Trustee in good faith, or otherwise be responsible or accountable under any
circumstances whatsoever, except for Trustee’s gross negligence, willful
misconduct or knowing violation of any Legal Requirement.  Trustee shall have the right to rely on any
instrument, document or signature authorizing or supporting any action taken or
proposed to be taken by it hereunder, believed by it in good faith to be
genuine.  All moneys received by Trustee
shall, until used or applied as herein provided, be held in trust for the purposes
for which they were received, but need not be segregated in any manner from any
other moneys (except to the extent required by law).  Trustee shall be under no liability for interest on any moneys
received by it hereunder.


 


5.8  Endorsement and Execution of Documents.  Upon Beneficiary’s written request, Trustee
shall, without liability or notice to Trustor, execute, consent to, or join in
any instrument or agreement in connection with or necessary to effectuate the
purposes of the Loan Documents to which the Beneficiary is a party or which
grants a security interest for the benefit of the Beneficiary.  Trustor hereby irrevocably designates
Trustee as its attorney in fact to execute, acknowledge and deliver, on Trustor’s
behalf and in Trustor’s name, all instruments or agreements necessary to
implement any provision(s) of this Deed of Trust or to further perfect the Lien
created by this Deed of Trust on the Trust Estate.  This power of attorney shall be deemed to be coupled with an
interest and shall survive any disability of Trustor.


 


5.9  Multiple Trustees.  If Beneficiary appoints multiple trustees, then any Trustee,
individually, may exercise all powers granted to Trustee under this instrument,
without the need for action by any other Trustee(s).


 


5.10  Terms of Trustee’s Acceptance.  Trustee accepts the trust created by this
Deed of Trust upon the following terms and conditions:


 


(a)  Delegation.  Trustee may exercise any of its powers
through appointment of attorney(s) in fact or agents.


 


(b)  Counsel.  Trustee may select and employ legal counsel
(including any law firm representing Beneficiary).  Trustor shall reimburse all reasonable legal fees and expenses
that Trustee may thereby incur.


 


(c)  Security.  Trustee shall be under no obligation to take
any action upon any Event of Default unless furnished security or indemnity, in
form satisfactory to Trustee, against costs, expenses, and liabilities that
Trustee may incur.


 


(d)  Costs
and Expenses.  Trustor shall
reimburse Trustee, as part of the Obligations secured hereunder, for all
reasonable disbursements and expenses (including reasonable legal fees and
expenses and any expenses incurred by Trustee in complying with the Nevada
Gaming Laws and Gaming Licenses) incurred by reason of and as provided for in
this Deed of Trust, including any of the foregoing incurred in Trustee’s
administering and executing the trust created by this Deed of Trust and
performing Trustee’s duties and exercising Trustee’s powers under this Deed of
Trust.


 


37






















 


(e)  Release.  Upon satisfaction of the conditions for reconveyance contained in
Section 6.10 hereof, Beneficiary shall request that Trustee release
this Deed of Trust and Trustee shall release this Deed of Trust and reconvey to
the Trust Estate in accordance with Section 6.10 hereof, provided, however,
that Trustor shall pay all costs of recordation, if any, and all of Trustee’s
and Beneficiary’s costs and expenses in connection with such release,
including, but not limited to, reasonable attorneys’ fees.


 


ARTICLE SIX



MISCELLANEOUS PROVISIONS


 


6.1  Successors and Assigns Included in
Parties.  Whenever one of the
parties hereto is named or referred to herein, successors and assigns of such
party shall be included, and subject to the limitations set forth herein and in
the Construction Loan Agreement, all covenants and agreements contained in this
Deed of Trust, by or on behalf of Trustor or Beneficiary shall bind and inure
to the benefit of its successors and assigns, whether so expressed or not.


 


6.2  Addresses for Notices, Etc.  Any notice, report, demand or other
instrument authorized or required to be given or furnished under this Deed of
Trust to Trustor, Beneficiary or Trustee shall be deemed given or furnished
(i) when addressed to the party intended to receive the same, at the
address of such party set forth below, and delivered by hand at such address or
(ii) three (3) days after the same is deposited in the United States mail
as first class certified mail, return receipt requested, postage paid, whether
or not the same is actually received by such party:


 


	
  Beneficiary:

  	
  The Bank of Nova Scotia

  580 California Street, 21st Floor

  San Francisco, California 94104

  Attention: Mr. Alan Pendergast

  Telefax: (415) 397-0791

  
	
   

  	
   

  
	
  With a copy to:

  	
  The Bank of Nova Scotia

  Loan Administration

  600 Peachtree Street, N.E.

  Atlanta, Georgia 30308

  Attention: Hilda Gabbidon or Vicki Gibson

  Telefax: (404) 888-8998

  
	
   

  	
   

  
	
  With a copy to:

  	
  Mayer, Brown, Rowe & Maw
  LLP

  1675 Broadway

  New York, New York 10019

  Attention: Douglas L. Wisner, Esq.

  



 


38






















 


	
  Trustor:

  	
  Phase II Mall Holding
  Subsidiary, LLC

  3355 Las Vegas Boulevard South

  Room 1A

  Las Vegas, Nevada 89109

  Attention: General Counsel

  Telefax: (702) 733-5499

  
	
   

  	
   

  
	
   

  	
  Phase II Mall Holding, LLC

  3355 Las Vegas Boulevard South

  Room 1A

  Las Vegas, Nevada 89109

  Attention: General Counsel

  Telefax: (702) 733-5499

  
	
   

  	
   

  
	
  With a copy to:

  	
  Paul, Weiss, Rifkind, Wharton
  & Garrison LLP

  1285 Avenue of the Americas

  New York, New York 10019-6064

  Attention: Harris B. Freidus, Esq.

  
	
   

  	
   

  
	
  Trustee:

  	
  First American Title
  Insurance Company
180 Cassia Way, Suite 502

  Henderson, Nevada 89104

  



 


6.3  Change of Notice Address.  Any Person may change the address to which
any such notice, report, demand or other instrument is to be delivered or
mailed to that person, by furnishing written notice of such change to the other
parties, but no such notice of change shall be effective unless and until
received by such other parties.


 


6.4  Headings.  The
headings of the articles, sections, paragraphs and subdivisions of this Deed of
Trust are for convenience of reference only, are not to be considered a part
hereof, and shall not limit or expand or otherwise affect any of the terms
hereof.


 


6.5  Invalid Provisions to Affect No Others.  In the event that any of the covenants,
agreements, terms or provisions contained herein or in the Notes, the
Construction Loan Agreement or any other Loan Document shall be invalid,
illegal or unenforceable in any respect, the validity of the Lien hereof and
the remaining covenants, agreements, terms or provisions contained herein or in
the Notes, the Construction Loan Agreement or any other Loan Document shall be
in no way affected, prejudiced or disturbed thereby.  To the extent permitted by law, Trustor waives any provision of
law which renders any provision hereof prohibited or unenforceable in any
respect.


 


6.6  Changes and Priority Over Intervening
Liens.  Neither this Deed of Trust
nor any term hereof may be changed, waived, discharged or terminated orally, or
by any action or inaction, but only by an instrument in writing signed by the
party against which enforcement of the change, waiver, discharge or termination
is sought.  Any agreement hereafter made
by


 


39






















 


Trustor and Beneficiary relating to this Deed of Trust shall be
superior to the rights of the holder of any intervening Lien or encumbrance.


 


6.7  Estoppel
Certificates.  Within ten (10)
Business Days after Beneficiary’s written request, Trustor shall from time to
time execute a certificate, in recordable form (an “Estoppel Certificate”),
stating, except to the extent it would be inaccurate to so state: (a) the
current amount of the Obligations secured hereunder and all elements thereof,
including principal, interest, and all other elements; (b) that Trustor
has no defense, offset, claim, counterclaim, right of recoupment, deduction, or
reduction against any of the Obligations secured hereunder; (c) that none
of the Loan Documents to which the Beneficiary is a party or which grants a
security interest for the benefit of the Beneficiary have been amended, whether
orally or in writing; (d) that Trustor has no claims against Beneficiary
of any kind; (e) that any Power of Attorney granted to Beneficiary is in
full force and effect; and (f) such other matters relating to this Deed of
Trust, any Loan Document to which the Beneficiary is a party or which grants a
security interest for the benefit of the Beneficiary and the relationship of
Trustor and Beneficiary as Beneficiary shall request.  In addition, the Estoppel Certificate shall set forth the reasons
why it would be inaccurate to make any of the foregoing assurances (“a” through
“f”).


 


6.8  Waiver of Setoff and Counterclaim.  All amounts due under this Deed of Trust,
the Notes or any other Loan Document to which the Beneficiary is a party or
which grants a security interest for the benefit of the Beneficiary shall be
payable without setoff, counterclaim or any deduction whatsoever.  Trustor hereby waives the right to assert a
counterclaim (other than a compulsory counterclaim) in any action or proceeding
brought against it by Beneficiary and/or any Lender under the Construction Loan
Agreement, or arising out of or in any way connected with this Deed of Trust,
or the other Loan Documents, to which the Beneficiary is a party or which
grants a security interest for the benefit of the Beneficiary or the
Obligations.


 


6.9  Governing Law. 
The Construction Loan Agreement and the Notes provide that they are
governed by, and construed and enforced in accordance with, the laws of the
State of New York.  This Deed of Trust
shall also be construed under and governed by the laws of the State of New York
without giving effect to the conflicts of law rules and principles of New York;
provided, however, that (i) the terms and provisions of this
Deed of Trust pertaining to the priority, perfection, enforcement or
realization by Beneficiary of its respective rights and remedies under this
Deed of Trust with respect to the Trust Estate shall be governed and construed
and enforced in accordance with the internal laws of the State without giving
effect to the conflicts-of-law rules and principles of the State;
(ii) Trustor agrees that to the extent deficiency judgments are available
under the laws of the State after a foreclosure (judicial or nonjudicial) of
the Trust Estate, or any portion thereof, or any other realization thereon by
Beneficiary or any Lender under the Construction Loan Agreement, Beneficiary or
such Lender, as the case may be, shall have the right to seek such a deficiency
judgment against Trustor in the State; and (iii) Trustor agrees that if
Beneficiary or any Lender under the Construction Loan Agreement obtains a
deficiency judgment in another state against Trustor, then Beneficiary or such
Lender, as the case may be, shall have the right to enforce such judgment in
the State to the extent permitted under the laws of the State, as well as in
other states.  Nothing contained in this
Section 6.9 shall be deemed to expand the limitations set forth in
Section 9.16 of the Construction Loan Agreement.


 


40






















 


6.10  Reconveyance. 
In the event that (i) the Obligations are indefeasibly repaid in full,
(ii) any part of the Trust Estate is sold, transferred or otherwise disposed of
by Trustor in accordance with the Construction Loan Agreement or (ii) any part
of the Trust Estate is otherwise released in accordance with the Construction
Loan Agreement or with the consent of the Requisite Lenders, the Trust Estate
(in the case of clause (i) of this Section 6.10) or portion
thereof (in the case of clauses (ii) or (iii) of this Section
6.10) will be sold, transferred or otherwise disposed of, and released free
and clear of the Liens created by this Deed of Trust and the Beneficiary, at
the request and expense of the Trustor, will duly and promptly assign,
transfer, deliver and release to the Trustor or its designee (without recourse
and without any representation or warranty) such of the Trust Estate as is then
being (or has been) so sold, transferred or otherwise disposed of or
released.  In connection with any
disposition or release pursuant to this Section 6.10, Beneficiary shall,
at Trustor’s expense, cause Trustee to reconvey, without warranty the Trust
Estate or portion thereof being disposed or released, as the case may be, and
to execute and deliver to Trustor such documents (including UCC-3 termination
statements) as Trustor may reasonably request. 
The recitals in such reconveyance of any matters or facts shall be
conclusive proof of the truthfulness thereof. 
The grantee in such reconveyance may be described as “the person or
persons legally entitled thereto.”


 


6.11  Attorneys’ Fees. 
Without limiting any other provision contained herein, Trustor agrees to
pay all costs of Beneficiary or Trustee incurred in connection with the
enforcement of this Deed of Trust of the Notes, including without limitation
all reasonable attorneys’ fees whether or not suit is commenced, and including,
without limitation, fees incurred in connection with any probate, appellate,
bankruptcy, deficiency or any other litigation proceedings, all of which sums
shall be secured hereby.


 


6.12  Late Charges. 
By accepting payment of any sum secured hereby after its due date,
Beneficiary does not waive its right to collect any late charge thereon or
interest thereon at the interest rate on the Notes, if so provided, not then
paid or its right either to require prompt payment when due of all other sums
so secured or to declare default for failure to pay any amounts not so paid.


 


6.13  Cost of Accounting.  Trustor shall pay to Beneficiary, for and on account of the
preparation and rendition of any accounting, which Trustor may be entitled to
require under any law or statute now or hereafter providing therefor, the
reasonable costs thereof.


 


6.14  Right of Entry. 
Subject to compliance with applicable Nevada Gaming Laws and the terms
of the Space Leases, Beneficiary may at any reasonable time or times and on
reasonable prior written notice to Trustor make or cause to be made entry upon
and inspections of the Trust Estate or any part thereof in person or by agent.


 


6.15  Corrections. 
Trustor shall, upon request of Beneficiary or Trustee, promptly correct
any defect, error or omission which may be discovered in the contents of this
Deed of Trust (including, but not limited to, in the exhibits and schedules
attached hereto) or in the execution or acknowledgement hereof, and shall
execute, acknowledge and deliver such further instruments and do such further
acts as may be necessary or as may be reasonably requested by Trustee to carry
out more effectively the purposes of this Deed of Trust, to subject to the Lien
and security


 


41






















 


interest hereby created any of Trustor’s properties, rights or interest
covered or intended to be covered hereby, and to perfect and maintain such Lien
and security interest.


 


6.16  Statute of Limitations.  To the fullest extent allowed by the law,
the right to plead, use or assert any statute of limitations as a plea or
defense or bar of any kind, or for any purpose, to any debt, demand or
obligation secured or to be secured hereby, or to any complaint or other
pleading or proceeding filed, instituted or maintained for the purpose of
enforcing this Deed of Trust or any rights hereunder, is hereby waived by
Trustor.


 


6.17  Subrogation. 
Should the proceeds of any Loan or advance made by Beneficiary to
Trustor, repayment of which is hereby secured, or any part thereof, or any
amount paid out or advanced by Beneficiary, be used directly or indirectly to
pay off, discharge, or satisfy, in whole or in part, any prior or superior Lien
or encumbrance upon the Trust Estate, or any part thereof, then, as additional
security hereunder, Trustee, on behalf of Beneficiary, shall be subrogated to
any and all rights, superior titles, Liens, and equities owned or claimed by
any owner or holder of said outstanding Liens, charges, and indebtedness,
however remote, regardless of whether said Liens, charges, and indebtedness are
acquired by assignment or have been released of record by the holder thereof
upon payment.


 


6.18  Joint and Several Liability.  All obligations of Trustor hereunder, if more
than one, are joint and several. 
Recourse for deficiency after sale hereunder may be had against the
property of Trustor, without, however, creating a present or other Lien or
charge thereon.


 


6.19  Homestead. 
Trustor hereby waives and renounces all homestead and exemption rights
provided by the constitution and the laws of the United States and of any
state, in and to the Trust Estate as against the collection of the Obligations,
or any part hereof.


 


6.20  Context.  In
this Deed of Trust, whenever the context so requires, the neuter includes the
masculine and feminine, and the singular including the plural, and vice versa.


 


6.21  Time.  Time is of
the essence of each and every term, covenant and condition hereof.  Unless otherwise specified herein, any
reference to “days” in this Deed of Trust shall be deemed to mean “calendar
days.”


 


6.22  Interpretation. 
As used in this Deed of Trust unless the context clearly requires
otherwise:  The terms “herein” or
“hereunder” and similar terms without reference to a particular section shall
refer to the entire Deed of Trust and not just to the section in which such
terms appear.


 


6.23  Effect of NRS § 107.030.  To the extent not inconsistent with the
other provisions of this Deed of Trust, the following covenants are hereby
adopted and made a part of this Deed of Trust: Nos. 1; 2 (pursuant to Section
1.8 above); 3; 4 (at the Default Rate); 5; 6; 7 (in a reasonable
percentage); 8 and 9 of NRS 107.030.


 


6.24  Amendments. 
This Deed of Trust cannot be waived, changed, discharged or terminated
orally, but only by an instrument in writing signed by the party against whom
enforcement of any waiver, change, discharge or termination is sought and only
as permitted by the provisions of the Construction Loan Agreement.


 


42






















 


6.25  No Conflicts. 
In the event that any of the provisions contained herein conflict with
the Security Agreement, then the provisions contained in the Security Agreement
shall prevail.


 


ARTICLE SEVEN



POWER OF ATTORNEY


 


7.1  Grant of Power. 
Subject to compliance with applicable Nevada Gaming Laws, Trustor
irrevocably appoints Beneficiary and any successor thereto as its attorney-in-fact,
with full power and authority, including the power of substitution, exercisable
only during the continuance of an Event of Default to act for Trustor in its
name, place and stead as hereinafter provided:


 


7.1.1  Possession
and Completion.  To take possession
of the Phase II Mall and the Phase II Mall Improvements, remove all employees,
contractors and agents of Trustor therefrom, complete or attempt to complete
the work of construction, and market, sell or lease the Phase II Mall  and the Phase II Mall Improvements.


 


7.1.2  Plans.  To make such additions, changes and corrections
in the current Plans and Specifications as may be necessary or desirable, in
Beneficiary’s reasonable discretion, or as it deems proper to complete the
Phase II Mall and the Phase II Mall Improvements.


 


7.1.3  Employment
of Others.  To employ such contractors,
subcontractors, suppliers, architects, inspectors, consultants, property
managers and other agents as Beneficiary, in its discretion, deems proper for
the completion of the Phase II Mall and the Phase II Mall Improvements, for the
protection or clearance of title to the Phase II Mall or the Phase II Mall
Improvements, or for the protection of Beneficiary’s interests with respect
thereto.


 


7.1.4  Security
Guards.  To employ watchmen to
protect the Phase II Mall and the Phase II Mall Improvements from injury.


 


7.1.5  Compromise
Claims.  To pay, settle or
compromise all bills and claims then existing or thereafter arising against
Trustor, which Beneficiary, in its discretion, deems proper for the protection
or clearance of title to the Phase II Mall and the Phase II Mall Improvements
or Personal Property, or for the protection of Beneficiary’s interests with
respect thereto.


 


7.1.6  Phase
II Mall Sale Agreement; Phase II Mall SA Assignment Agreement. To perform
or cause the performance of all obligations of Trustor thereunder, to prosecute
and defend all actions and proceedings in connection therewith and to do all
other acts with respect thereto that Trustor might do on its or their own
behalf, as Beneficiary, in its reasonable discretion, deems proper for the
protection of Beneficiary’s interests with respect thereto.


 


7.1.7  Legal
Proceedings.  To prosecute and
defend all actions and proceedings in connection with the Phase II Mall or the
Phase II Mall Improvements.


 


7.1.8  Other
Acts.  To execute, acknowledge and
deliver all other instruments and documents in the name of Trustor that are
necessary or desirable, to exercise Trustor’s rights under all contracts
concerning the Phase II Mall or the Phase II Mall Improvements, including,


 


43






















 


without limitation, under any Space Leases, and to do all other acts
with respect to the Phase II Mall or the Phase II Mall Improvements that
Trustor might do on its own behalf, as Beneficiary, in its reasonable discretion,
deems proper.


 


[Signature
pages to follow]


 


44






















 


IN WITNESS WHEREOF, Trustor has executed this Deed of
Trust, Leasehold Deed of Trust, Assignment of Rents and Leases, Security
Agreement and Fixture Filing to be effective as of the day and year first above
written.


 


	
   

  	
  PHASE II MALL SUBSIDIARY, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Phase
  II Mall Holding, LLC, its sole member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Lido
  Casino Resort Holding Company,

  
	
   

  	
   

  	
   

  	
  LLC,
  its Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Lido
  Intermediate Holding Company,

  
	
   

  	
   

  	
   

  	
   

  	
  LLC,
  its managing member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Venetian
  Casino Resort, LLC, its

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  sole
  member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Las
  Vegas Sands, Inc., its

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  managing
  member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Harry Miltenberger

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Harry
  Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  VP
  Finance, Secretary & Chief Accounting Officer

  
										



 


	
   

  	
  PHASE II MALL HOLDING, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Lido
  Casino Resort Holding Company, LLC, 

  
	
   

  	
   

  	
  its
  Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Lido Intermediate Holding
  Company, 

  
	
   

  	
   

  	
   

  	
   

  	
  LLC, its managing member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Venetian Casino Resort, LLC,
  its 

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  sole member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Las Vegas Sands, Inc., its 

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  managing member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Harry Miltenberger

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Harry
  Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  VP
  Finance, Secretary & Chief Accounting Officer

  
										



 


S-1






















 


	
  State of

  	
  )

  	
   

  
	
  County of

  	
  ) ss.:

  	
   

  



 


On the 29th day of
September in the year 2004 before me, the undersigned, personally appeared
Harry Miltenberger, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed
to the within instrument and acknowledged to me that he/she/they executed the
same in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.


 


	
   

  	
  /s/ Bonnie Bruce

  	
   

  
	
   

  	
  (Signature and office of individual taking

  
	
   

  	
  acknowledgment)

  



 


Notarial Seal


 


 


	
  State of

  	
  )

  	
   

  
	
  County of

  	
  ) ss.:

  	
   

  



 


On the
         day of
               in the year 2004 before me, the undersigned,
personally appeared                                                   ,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.


 


	
   

  	
   

  	
   

  
	
   

  	
  (Signature and office of individual taking

  
	
   

  	
  acknowledgment)

  



 


Notarial Seal


 


N-1