Document:

Exhibit 10.68

 

DISBURSEMENT COLLATERAL ACCOUNT AGREEMENT

 

This DISBURSEMENT COLLATERAL ACCOUNT AGREEMENT
(this “Agreement”) is dated as of September 30,
2004, and entered into by and among LAS VEGAS SANDS, INC., a
Nevada corporation (“LVSI”), VENETIAN CASINO
RESORT, LLC, a Nevada limited liability company (“VCR”), LIDO CASINO RESORT, LLC, a Nevada limited liability company (“LCR”, and jointly and severally with LVSI and VCR, “Pledgor”),
THE BANK OF NOVA SCOTIA, as custodian and in its capacity as a “securities
intermediary” as defined in Section 8-102 of the UCC and a “bank” as defined in
Section 9-102 of the UCC (in such capacities, the “Financial
Institution”), and THE BANK OF NOVA SCOTIA, a
Canadian chartered bank, in its capacity as the Intercreditor Agent under the
Intercreditor Agreement (as defined below) (in such capacity, “Intercreditor
Agent”) for and on behalf of (i) each Bank Intercreditor
Agent (as defined below), (ii) U.S. Bank National Association, a national
banking association, as the trustee (the “Mortgage Notes Indenture Trustee”)
for and on behalf of the Mortgage Note Holders (individually, each a “Mortgage
Note Intercreditor Agent” and together, the “Mortgage
Note Secured Parties”) under the Mortgage Notes Indenture (as
defined below) and (iii) the Intercreditor Agent.

 

PRELIMINARY STATEMENTS

 

A.  The Phase II
Project.  LCR proposes to
develop, construct and operate the Phase II Project at the Site adjoining
the Existing Facility.

 

B.  Credit
Agreement.  LVSI, VCR, the
Administrative Agent, the Syndication Agent and the Lenders have entered into a
Credit Agreement dated as of August 20, 2004 (the “Credit Agreement”) pursuant to which the Lenders have agreed,
subject to the terms thereof, to provide Credit Extensions to LVSI and VCR,
jointly and severally, in an aggregate amount and for purposes specified
therein.

 

C.  Mortgage Notes Indenture.  LVSI, Venetian, certain guarantors named
therein and the Mortgage Notes Indenture Trustee entered into the Mortgage
Notes Indenture, dated as of June 4, 2002 (the “Mortgage Notes  Indenture”),
pursuant to which LVSI and Venetian issued the Notes (referred to therein).

 

D.  Capacity and
Obligations of Intercreditor Agent. 
The Intercreditor Agent, the Bank Agent and the Mortgage Notes Indenture
Trustee have entered into the Amended and Restated Intercreditor Agreement,
dated as of August 20, 2004 (as amended, amended and restated, supplemented or
otherwise modified, from time to time, the “Intercreditor Agreement”),
which sets forth certain agreements among such lenders with respect to the
priority of the liens created hereunder, the enforcement of remedies and the
allocation of the proceeds of any realization upon collateral.  The Intercreditor Agent is entering into this
Agreement and shall perform its obligations as set forth herein and in the
manner provided, pursuant to the provisions of the

 

 

Intercreditor Agreement and shall take directions from time to time
from one or more of the Secured Credit Parties as defined and provided for
therein.

 

E.  Condition.  It is a condition precedent to the making of additional
Loans and other extensions of credit under the Credit Agreement by the Lenders
that Pledgor shall establish the Collateral Accounts, grant control of the
Collateral Accounts to the Intercreditor Agent, and undertake the obligations
contemplated by this Agreement.

 

NOW, THEREFORE, in
consideration of the premises and in order to induce the Lenders to enter into
the Credit Agreement and make loans and other extensions of credit thereunder
and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Pledgor hereby agrees with Intercreditor Agent
as follows:

 

SECTION 1. 
Certain Definitions.

 

(a)  Specific
Definitions.  The following
terms used in this Agreement shall have the following meanings:

 

“Bank Secured Parties” means the Secured Parties, as
defined in the Credit Agreement.

 

“Broker-Dealer”
means a person registered as a broker or dealer under the Securities Exchange
Act of 1934, as amended.

 

“Bank Secured Obligations” means the Bank Secured
Obligations and Senior Lender Hedging Obligations, each as defined in the
Intercreditor Agreement.

 

“Mortgage Notes Secured Obligations” means the Mortgage
Notes Secured Obligations, as defined in the Intercreditor Agreement.

 

“Collateral” means
(i) the Collateral Accounts, (ii) all amounts held from time to time in the
Collateral Accounts, (iii) all Investments, including all financial assets,
security entitlements, securities (whether certificated or uncertificated),
instruments, accounts, general intangibles and deposits representing or
evidencing any Investments, (iv) all interest, dividends, cash, instruments,
securities and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the
Collateral, and (v) to the extent not covered by clauses (i) through (iv)
above, all proceeds of any or all of the foregoing Collateral.

 

“Collateral Accounts”
means the Securities Accounts, the Deposit Accounts, and any other accounts or
sub-accounts in which Investments may be held or registered.

 

“Deposit Accounts” means the deposit accounts
established and maintained with Financial Institution pursuant to Section 2,
including the Phase II Hotel/Casino Cash Management Account.

 

“Financial Institution” is defined in the preamble.

 

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“Investments” means
any Financial Assets credited to the Collateral Accounts, and any other
property acquired by Financial Institution as securities intermediary hereunder
in exchange for, with proceeds from or distributions on, or otherwise in
respect of any Investments.

 

“Overnight Investments” means
an interest bearing overnight deposit account with a Canadian branch of The
Bank of Nova Scotia.

 

“Permitted Investments” means
Cash and Cash Equivalents.

 

“Secured Obligations” means the “Obligations” as defined
in the Intercreditor Agreement.

 

“Secured Parties” means the Bank Secured Parties and the
Mortgage Notes Secured Parties.

 

“Securities Accounts”
means the securities accounts established and maintained with Financial
Institution pursuant to Section 2, including the Bank Proceeds Account, the
Disbursement Account, the Phase II Hotel/Casino Equity Account, and the Supplemental
Hotel/Casino Cash Account (including the Free Cash Flow Sub-Account therein).

 

“Suspension Period” means
each period beginning on the occurrence of a Potential Event of Default or
Event of Default and continuing so long as any Potential Event of Default or Event
of Default shall continue.

 

(b)  General
Provisions.  Capitalized terms
used but not defined herein shall have the meaning given to such terms in the
Credit Agreement.  Unless otherwise
defined herein or in the Credit Agreement, terms used in Articles 8 and 9 of
the UCC are used herein as therein defined. 
Words used herein, regardless of the number and gender specifically
used, shall be deemed and construed to include any other number, singular or
plural, and any other gender, masculine, feminine or neuter, as the context
indicates is appropriate.  When a
reference is made in this Agreement to an Appendix, Exhibit, Introduction,
Recital, Section or Schedule, such reference shall be to an Appendix, an
Exhibit, the Introduction, a Recital or a Section of, or a Schedule to, this
Agreement unless otherwise indicated. 
The headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include, “includes” or “including”
are used in this Agreement, they shall be deemed to be followed by the words “
without limitation.”

 

SECTION 2. 
Establishment and Operation of the
Collateral Accounts.

 

(a)  Establishment of Bank Proceeds Account.  Pledgor and Intercreditor Agent hereby
authorize and direct Financial Institution to establish and maintain at its
office at One Liberty Plaza, New York, New York 10006, a Securities Account in
the name of LCR, and under the control of Intercreditor Agent, designated as “Account
number 03036-15, The Bank of Nova Scotia, as Administrative Agent under the
Credit Agreement, dated as of August 20, 2004, Bank Proceeds Account”.  Financial Institution hereby undertakes to
treat Intercreditor Agent as the Person entitled to exercise the rights that
comprise any Financial Asset credited to the Bank Proceeds Account.  The Intercreditor Agent and the Pledgor agree
that this account shall be the “Bank Proceeds
Account.”

 

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(b)  Establishment of Disbursement Account.  Pledgor and Intercreditor Agent hereby
authorize and direct Financial Institution to establish and maintain at its
office at One Liberty Plaza, New York, New York 10006, a Securities Account in
the name of LCR, and under the control of Intercreditor Agent, designated as “Account
number 03047-17, The Bank of Nova Scotia, as Administrative Agent under the
Credit Agreement, dated as of August 20, 2004, Disbursement Account”.  Financial Institution hereby undertakes to
treat Intercreditor Agent as the Person entitled to exercise the rights that
comprise any Financial Asset credited to the Disbursement Account.  The Intercreditor Agent and the Pledgor agree
that this account shall be the “Disbursement
Account.”

 

(c)  Establishment of Phase II Hotel/Casino Cash Management Account.  Pledgor and Intercreditor Agent hereby
authorize and direct Financial Institution to establish and maintain at its
office at One Liberty Plaza, New York, New York 10006, a Deposit Account in the
name of LCR, and under the control of Intercreditor Agent, designated as “Account
number 03048-16, The Bank of Nova Scotia, as Administrative Agent under the
Credit Agreement, dated as of August 20, 2004, Phase II Hotel/Casino Cash
Management Account”.  The Intercreditor Agent
and the Pledgor agree that this account shall be the “Phase II Hotel/Casino Cash Management  Account.”

 

(d)  Establishment of Phase II Hotel/Casino Equity Account.  Pledgor and Intercreditor Agent hereby
authorize and direct Financial Institution to establish and maintain at its
office at One Liberty Plaza, New York, New York 10006, a Securities Account in the name of LCR, and under the
control of Intercreditor Agent, designated as “Account number 03044-17, The
Bank of Nova Scotia, as Administrative Agent under the Credit Agreement, dated
as of August 20, 2004, Phase II Hotel/Casino Equity Account”.  Financial Institution hereby undertakes to
treat Intercreditor Agent as the Person entitled to exercise the rights that
comprise any Financial Asset credited to the Phase II Hotel/Casino Equity
Account.  The Intercreditor Agent and the
Pledgor agree that this account shall be the “Phase
II Hotel/Casino Equity Account.”

 

(e)  Establishment of Supplemental Hotel/Casino
Cash Account.  Pledgor and Intercreditor Agent hereby
authorize and direct Financial Institution to establish and maintain at its
office at One Liberty Plaza, New York, New York 10006, a Securities Account in
the name of LCR, and under the control of Intercreditor Agent, designated as “Account
number 03050-14, The Bank of Nova Scotia, as Administrative Agent under the
Credit Agreement, dated as of August 20, 2004, Supplemental Hotel/Casino Cash Account”. 
Financial Institution hereby undertakes to treat Intercreditor Agent as
the Person entitled to exercise the rights that comprise any Financial Asset
credited to the Supplemental Hotel/Casino Cash Account.  The Intercreditor
Agent and the Pledgor agree that this account shall be understood to be the “Supplemental Company Cash Account”
referenced in the Bank Credit Agreement.

 

(f)   Establishment of Free Cash Flow
Sub-Account.  Pledgor and
Intercreditor Agent hereby authorize and direct Financial Institution to
establish and maintain at its office at One Liberty Plaza, New York, New York
10006, a sub-account within the Supplemental Hotel/Casino Cash Account, in the
name of LCR, and under the control of Intercreditor Agent, designated as “Sub-account
number 03051-11, The Bank of Nova Scotia, as Administrative Agent under the
Credit Agreement, dated as of August 20, 2004, Supplemental Hotel/Casino

 

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Cash Account — Free Cash Flow Sub Account”.  The Intercreditor Agent and the Pledgor agree
that this sub-account shall be the “Free Cash
Flow Sub-Account.”

 

(g)  Operations of the Collateral Accounts.  The Collateral Accounts shall be operated,
and all Investments shall be acquired and registered or held (as applicable),
in accordance with the terms of this Agreement and the directions of
Intercreditor Agent.  Each of the parties
hereto acknowledges and agrees that the Phase II Hotel/Casino Cash Management
Account is intended to be a deposit account (as defined in Section 9-102(a)(29)
of the UCC) and the rest of the Collateral Accounts are intended to be securities
accounts (as defined in Section 8-501 of the UCC).  Notwithstanding such intention, as used
herein “Deposit Account” shall mean any Collateral Account (or any part thereof
) which is determined to be a “deposit account” (within the meaning of Section
9-102(a)(29) of the UCC) and “Securities Account” shall mean any Collateral
Account (or any part thereof) which is determined to be a “securities account”
(within the meaning of Section 8-501 of the UCC).

 

(h)  Account Statements. 
Financial Institution shall send Intercreditor Agent and Pledgor written
account statements with respect to the Collateral Accounts not less frequently
than monthly.  Reports or confirmation of
the execution of orders and statements of account shall be conclusive if not
objected to in writing within 30 days after delivery pursuant to
Section 21.

 

SECTION 3. 
Mechanics of Deposits of Funds in and between
Collateral Accounts.

 

(a)  Acknowledgement of Deposit. 
Financial Institution and Intercreditor Agent acknowledge the deposit of
$354,652,847.54 in the Bank Proceeds Account on
the date hereof.

 

(b)  Transfers to the Bank Proceeds Account.  All transfers of funds to the Bank Proceeds
Account shall be made by wire transfer (or, if applicable, intra-bank transfer
from another account of Pledgor with Financial Institution) of immediately
available funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03036-15

Reference: Venetian Phase II Project – Bank Proceeds Account

Attention: Hilma Gabbidon and Vicki Gibson

 

(c)  Transfers to the Disbursement Account.  All transfers of funds to the Disbursement
Account shall be made by wire transfer (or, if applicable, intra-bank transfer
from another account of Pledgor with Financial Institution) of immediately
available funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03047-17 

Reference: Venetian Phase II Project—Disbursement Account

Attention: Hilma Gabbidon and Vicki Gibson

 

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(d)  Transfers to the Phase II Hotel/Casino Cash Management Account.  All transfers of funds to the Phase II
Hotel/Casino Cash Management Account shall be made by wire transfer (or, if
applicable, intra-bank transfer from another account of Pledgor with Financial
Institution) of immediately available funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03048-16

Reference: Venetian Phase II Project – Phase II Hotel/Casino Cash
Management Account

Attention: Hilma Gabbidon and Vicki Gibson

 

(e)  Transfers to the Phase II Hotel/Casino Equity Account.  All transfers of funds to the Phase II
Hotel/Casino Equity Account shall be made by wire transfer (or, if applicable,
intra-bank transfer from another account of Pledgor with Financial Institution)
of immediately available funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03044-17

Reference: Venetian Phase II Project – Phase II Hotel/Casino Equity
Account

Attention: Hilma Gabbidon and Vicki Gibson

 

(f)  Transfers to the Supplemental Hotel/Casino Cash Account.  All transfers of funds to the Supplemental
Hotel/Casino Cash Account shall be made by wire transfer (or, if applicable,
intra-bank transfer from another account of Pledgor with Financial Institution)
of immediately available funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03050-14

Reference: Venetian Phase II Project – Supplemental Hotel/Casino Cash
Account

Attention: Hilma Gabbidon and Vicki Gibson

 

(g)  Transfers to the Free Cash Flow Sub-Account.  All transfers of funds to the Free Cash Flow Sub-Account
shall be made by wire transfer (or, if applicable, intra-bank transfer from
another account of Pledgor with Financial Institution) of immediately available
funds, in each case addressed as follows:

 

The Bank of Nova Scotia - New York Agency

ABA #0260-0253-2

for credit to account #03051-11

Reference: Venetian Phase II Project – Free Cash Flow Sub-Account

Attention:  Hilma Gabbidon and
Vicki Gibson

 

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(h)  Notice of Transfers.  In
the event of any transfer of funds to or from the Collateral Accounts pursuant
to any provision of Section 3, Pledgor, Intercreditor Agent or Financial
Institution, as the case may be, shall promptly after initiating or sending out
written instructions with respect to such transfer, give notice to each other
such party by facsimile of the date and amount of such transfer.

 

SECTION 4. 
Permitted
Investments and Transfers of Amounts in the Collateral Accounts.

 

(a)  Strict Compliance. 
Cash held by Financial Institution in the Collateral Accounts shall not
be (i) invested or reinvested, (ii) sold or redeemed, or (iii) transferred from
the Collateral Accounts, except as provided in this Section 4.

 

(b)  Pledgor’s Right to Direct Investment.  Except during any Suspension Period,
Financial Institution shall, in accordance with Pledgor’s written Entitlement
Orders given to Financial Institution from time to time, sell or redeem
Investments, and apply amounts transferred to, or held for the credit of, the
Securities Accounts to make Investments for credit to the Securities Accounts,
in Financial Institution’s name and as custodian under this Agreement, in
Permitted Investments.  During any
Suspension Period, (i) Pledgor’s right to direct such Investments under this
Section 4(b) shall be suspended, and Financial Institution shall not
accept Entitlement Orders with respect to the Securities Accounts from any
person other than Intercreditor Agent; and (ii) any credit balances shall be
invested and reinvested only as provided in Section 4(c).

 

(c)  Overnight Investments. 
To the extent that there are credit balances expected in any Collateral
Account as of the end of the day, or as of 12:00 noon, New York time on any
Business Day after settlement of all pending transactions, unless otherwise
instructed by Intercreditor Agent or Pledgor pursuant to Section 4(b),
Financial Institution shall apply the expected credit balances to acquire
Overnight Investments.  Any Overnight Investments
shall be held for the credit of the Collateral Account for which the Overnight
Investment was acquired.  Pledgor shall
have no right to invest funds in a Securities Account to the extent that free
balances have been invested in Overnight Investments pursuant to this
Section.  Pledgor hereby acknowledges
that, as foreign deposit accounts, “Overnight Investments” may not benefit from
any protections afforded to domestic depositors by state or Federal law, may
have a lesser preference in a liquidation than a domestic deposit, and are
subject to cross-border risks.  No U.S.
licensed office of The Bank of Nova Scotia separately guarantees or promises
the repayment of any Overnight Investment.

 

(d)  Actions of Financial Institution on Purchase of Investments.  Promptly upon the purchase, acquisition or
transfer for credit of any Collateral Account of any Investment, Financial
Institution shall take all steps that it customarily takes in the ordinary
course of its business to ensure that such Investment is credited on its books
to the Collateral Account for which the Investment was acquired.  Without limiting the generality of the
foregoing, Financial Institution shall promptly (i) send to Pledgor and
Intercreditor Agent a written confirmation of the acquisition of such
Investment, and (ii) indicate by book entry in its records that such Investment
has been credited to, and is held for the credit of, the specified Collateral
Account.

 

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Financial Institution agrees with Pledgor and Intercreditor Agent that
any cash, Investments or property credited to, or held for the credit of, the
Collateral Accounts shall be treated as Financial Assets.

 

(e)  Interest on Collateral Accounts.  Amounts held on deposit or as credit balances
in the Collateral Accounts (whether a Deposit Account or a Securities Account)
shall not bear interest, although to the extent invested in Investments
(including Overnight Investments), deposit or credit balances may realize
interest income.

 

(f)  Control Agreement. 
Financial Institution shall, if and as directed in writing by
Intercreditor Agent, without the consent of Pledgor, (i) comply with
Entitlement Orders originated by Intercreditor Agent with respect to the
Collateral Accounts and any Security Entitlements therein, (ii) transfer, sell
or redeem any of the Collateral, (iii) transfer any or all of the Collateral to
any account or accounts designated by Intercreditor Agent, including an account
established in Intercreditor Agent’s name (whether at Intercreditor Agent or
Financial Institution or otherwise), (iv) register title to any Collateral in
any name specified by Intercreditor Agent, including the name of Intercreditor
Agent or any of its nominees or agents, without reference to any interest of
Pledgor, or (v) otherwise deal with the Collateral as directed by Intercreditor
Agent; provided that Intercreditor Agent agrees not to take any such action
unless a Potential Event of Default or an Event of Default has occurred and is
continuing.  Financial Institution shall
act on any instruction of Intercreditor Agent notwithstanding assertions or
proof that (1) Intercreditor Agent has no right under Sections 14 or 15 to
originate the instruction or take the underlying action; (2) such instruction
or action constitutes a breach of this Agreement or any other agreement; or (3)
this Agreement has terminated, unless notified in writing by Intercreditor
Agent that this Agreement has terminated and such notice has not been
withdrawn.  Nothing contained in this
paragraph shall constitute a waiver of by Pledgor of any rights or remedies it
may have against Intercreditor Agent under this Agreement or any other
agreement.  If the Pledgor is otherwise
entitled to give any entitlement orders or instructions with respect to the
Collateral Accounts in accordance with Sections 4(b) or 8(b)(ii) hereof and
such entitlement orders or instructions conflict with instructions of the
Intercreditor Agent, the Financial Institution shall comply with the
entitlement orders and instructions issued by the Intercreditor Agent.  The
intent of the foregoing is to perfect both of the liens granted under Section
5(a) and Section 5(b).

 

(g)  Deposit of Proceeds. 
Any interest earned on any of the Collateral Accounts in accordance with
Section 4(e), any interest, cash dividends or other cash distributions
received in respect of any Investments and the net proceeds of any sale or
payment of any Investments shall be promptly credited to, and held for the
credit of, the Collateral Account to which such Investment was credited.  Any distribution of property, other than cash
in respect of any Investment shall be credited to and held for the credit of
the Collateral Account to which such Investment was credited; provided that, unless otherwise instructed
in writing by Intercreditor Agent, Financial Institution shall, for credit to
the Collateral Accounts, promptly sell, redeem or otherwise liquidate any such
property that, as of the date of receipt, is not a Permitted Investment.

 

(h)  Segregation of Accounts.  Except
to the extent otherwise instructed by Intercreditor Agent or as provided in
Section 2(a), 2(b), 2(c), 2(d), 2(e) or 2(f), Financial

 

8

 

Institution shall separately maintain each of the Collateral Accounts
and shall not transfer property or proceeds among the Collateral Accounts.

 

SECTION 5. 
Pledge
of Security for Secured Obligations.  

 

(a)  Senior Grant in Favor of
Intercreditor Agent on behalf of Bank Secured Parties.  Pledgor hereby pledges and assigns to, and
hereby grants to, Intercreditor Agent, on behalf of and for the benefit of the
Bank Secured Parties and the Intercreditor Agent, a security interest in, all
of Pledgor’s right, title and interest in and to the Collateral as collateral
security for the prompt payment or performance in full when due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including the payment of amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the United States
Bankruptcy Code, 11 U.S.C. 362(a)), of all Bank Secured Obligations.

 

(b)  Junior Grant in Favor of
Intercreditor Agent on behalf of Mortgage Notes Secured Parties.  Pledgor hereby pledges and assigns to, and
hereby grants to, Intercreditor Agent, on behalf of and for the benefit of the
Mortgage Notes Secured Parties, a security interest in, all of Pledgor’s right,
title and interest in and to the Collateral as collateral security for the
prompt payment or performance in full when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
the payment of amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy Code,
11 U.S.C. 362(a)), of all Mortgage Notes Secured Obligations.

 

SECTION 6. 
Acknowledgement
of Security Interest in Favor of Intercreditor Agent; Covenant Against Creation
of other Interests.

 

(a)  Acknowledgement of Security Interest.  Financial Institution acknowledges the
security interest granted by Pledgor in favor of Intercreditor Agent in the
Collateral.

 

(b)  Acknowledgement of Financial Institution’s Role.  Financial Institution hereby further
acknowledges that it holds the Collateral Accounts, and all Security
Entitlements therein, as custodian for, for the benefit of, and subject to the
control of, Intercreditor Agent. 
Financial Institution shall, by book entry or otherwise, indicate that
the Collateral Accounts, and all Security Entitlements registered to or held
therein, are subject to the control of Intercreditor Agent as provided in
Section 4(f).

 

(c)  Financial Institution Has No Notice of Adverse Claims.  Financial Institution represents and warrants
that (i) it has no notice of any adverse claim against any of the Collateral
other than the claim of Intercreditor Agent under this Agreement; and (ii) it
is not, in its capacity as securities intermediary, party to any agreement
other than this Agreement that governs its rights or duties, or limits or
conflicts with the rights of Intercreditor Agent, including the exclusive right
of Intercreditor Agent to control as provided in Section 4(f), with
respect to the Collateral Accounts.

 

(d)  Financial Institution Shall Not Acknowledge Other Claims.  Financial Institution agrees that, except as
expressly provided in this Agreement or with the written consent of
Intercreditor Agent, it shall not agree to or acknowledge (i) any right by any
Person other than Intercreditor Agent to originate Entitlement Orders or
control with respect to the

 

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Collateral Accounts; or (ii) any limitation on the right of
Intercreditor Agent to originate Entitlement Orders with respect to or direct
the transfer of any Investments or cash credited to the Collateral Accounts.

 

SECTION 7. 
Financial
Institution Maintenance of the Collateral Accounts.

 

(a)  Transactions Shall Comply With Rules.  The parties acknowledge that all transactions
in Financial Assets under this Agreement shall be in accordance with the rules
and customs of the exchange, market or clearing organization, if any, in which
the transactions are executed or settled and in conformity with applicable law
and regulations of governmental authorities and future amendments or
supplements thereto.

 

(b)  Fees and Charges of Financial Institution.  Pledgor shall pay to Financial Institution,
in accordance with Financial Institution’s usual schedule of charges or any
written agreement between Financial Institution and Pledgor, any fees or
charges reasonably imposed by Financial Institution with respect to the
establishment, maintenance and transactions in or affecting the Collateral
Accounts.

 

(c)  Financial Institution Shall Not Permit Leverage of Investments.  Financial Institution shall not execute any
transaction to acquire a Financial Asset under Section 4(b) unless there
are sufficient funds in a specific Collateral Account or reasonably expected
with respect to pending transactions in such Collateral Account to settle such
transaction for the account of such Collateral Account.  Notwithstanding the foregoing sentence, in
the event that Financial Institution executes a transaction without adequate
funds to settle the transaction, Pledgor shall be liable to Financial Institution
for any deficiency and shall promptly reimburse Financial Institution for any
loss or expense incurred thereby, including losses sustained by reason of
Financial Institution’s inability to borrow any securities or other property
sold for the Collateral Account.  Pledgor
agrees to pay interest charges which may be imposed by Financial Institution in
accordance with its usual custom, with respect to late payments for Financial
Assets purchased for any Collateral Account and prepayments to any Collateral
Account (i.e., the crediting of
the proceeds of sale before the settlement date or receipt by Financial
Institution of the items sold in good deliverable form).  Pledgor agrees to pay promptly any amount
which may become due in order to satisfy demands for additional margin or marks
to market with respect to any security purchased or sold on instruction from
Pledgor.

 

(d)  Risk of Investments and Transactions.  It is not the intention of the parties that
Financial Institution should bear any investment risk associated with Permitted
Investments or Overnight Investments acquired for the credit of the Collateral
Accounts in accordance with Section 4. 
Any losses or gains realized on such Investments shall be charged or
credited to the Collateral Accounts, as appropriate.  On committing to a transaction for the credit
of the Collateral Accounts pursuant to an instruction permitted in accordance
with Section 4, Financial Institution may, (i) pending settlement, block
(A) the Investments to be sold or (B) credit balances sufficient to settle any
acquisition and, (ii) at the time of settlement, deliver such Investments or
funds in accordance with the rules, custom or practice of the particular
market.

 

(e)  Use of Intermediaries and Nominees.  Financial Institution is authorized, subject
to Intercreditor Agent’s written instructions, to register any Financial Assets
acquired by

 

10

 

Financial Institution pursuant to this Agreement in the name of
Financial Institution or in the name of its nominee, or to cause such
securities to be registered in the name of a Federal reserve bank, a recognized
securities intermediary or clearing corporation, or a nominee of any of
them.  Financial Institution may at any
time and from time to time appoint, and may at any time remove, any bank, trust
company, clearing corporation, or Broker-Dealer as its agent to carry out such
of the provisions of this Agreement.  The
appointment or use of any intermediary, or the appointment of any such agent,
shall not relieve Financial Institution of any responsibility or liability
under this Agreement.

 

(f)  Corporate Actions. 
Except as otherwise set forth herein, the parties agree that neither
Intercreditor Agent nor Financial Institution shall have any responsibility for
ascertaining or acting upon any calls, conversions, exchange offers, tenders,
interest rate changes or similar matters relating to any Financial Assets
credited to or held for the credit of the Securities Accounts (except based on
written instructions originated by Pledgor or Intercreditor Agent), or for
informing Pledgor or Intercreditor Agent with respect thereto, whether or not
Financial Institution or Intercreditor Agent has, or is deemed to have,
knowledge of any of the aforesaid. 
Financial Institution is authorized to withdraw securities sold or
otherwise disposed of, and to credit the Collateral Accounts with the proceeds
thereof or make such other disposition thereof as may be directed in accordance
with this Agreement.  Financial
Institution is further authorized to collect all income and other payments
which may become due on Financial Assets credited to the Collateral Accounts,
to surrender for payment maturing obligations and those called for redemption
and to exchange certificates in temporary form for like certificates in
definitive form, or, if the par value of any shares is changed, to effect the
exchange for new certificates.  It is
understood and agreed by Pledgor and Intercreditor Agent that, although
Financial Institution will use reasonable efforts to effect the transactions
set forth in the preceding sentence, Financial Institution shall incur no
liability for its failure to effect the same unless its failure is the result
of willful misconduct

 

(g)  Disclosure of Account Relationships.  Pledgor and Intercreditor Agent acknowledge
that Financial Institution may be required to disclose to securities issuers
the name, address and securities positions with respect to Financial Assets
credited to the Collateral Accounts, and hereby consent to such disclosures.

 

(h)  Forwarding of Documents. 
Financial Institution shall forward to Pledgor and Intercreditor Agent,
or notify Pledgor and Intercreditor Agent by telephone of, all communications
received by Financial Institution as owner of any Financial Assets credited to
the Collateral Accounts and which are intended to be transmitted to the
beneficial owner thereof.

 

(i)  Direction of Intercreditor Agent Controls in Disputes.  Pledgor, Financial Institution and
Intercreditor Agent hereby agree that in the event any dispute arises with
respect to the payment, ownership or right to possession of the Collateral
Accounts or any other Collateral credited to or held therein, Financial
Institution shall take such actions and shall refrain from taking such actions
with respect thereto as may be directed by Intercreditor Agent.

 

(j)  No Setoff, etc. 
Financial Institution shall not exercise on its own behalf any claim,
right of set-off, banker’s lien, clearing lien, counterclaim or similar right
against any of the Collateral; provided that
Financial Institution may deduct, from any credit balances, any

 

11

 

usual and ordinary transaction and administration fees payable in
connection with the administration and operation of the Collateral
Accounts.  Except for claims for
deductions permitted in the preceding sentence, Financial Institution agrees
that any security interest it may have in the Collateral Accounts or any
security entitlement carried therein shall be subordinate and junior to the
interest of Intercreditor Agent.

 

(k)  Care of Financial Assets. 
Financial Institution shall maintain possession or control of all
Financial Assets credited to the Collateral Accounts by segregating such
Financial Assets from its proprietary assets and keeping them free of any lien,
charge or claim of any third party granted or created by Financial
Institution.  Financial Institution shall
take such other steps to ensure that Financial Assets credited to the
Collateral Accounts are identified as being held for customers of Financial
Institution as may required under applicable law, including 17 CFR Part 450, or
in accordance with custom and practice in the industry.

 

SECTION 8. 
Transactions
in Collateral Accounts.

 

(a)  Power of Intercreditor Agent to Sell or Transfer.  Pledgor agrees that Intercreditor Agent may
sell or cause the sale or redemption of any Investment and instruct Financial
Institution to transfer the proceeds of such sale or any other credit or
balance in any of the Collateral Accounts to any other Collateral Account or to
any third party or account, in either case (i) if such sale or redemption is
necessary to permit Intercreditor Agent or the Disbursement Agent to perform
its duties under this Agreement, the Disbursement Agreement or the Credit
Agreement, or (ii) as provided in Section 14.

 

(b)  Drawings by Pledgor. 
Except as provided in Section 8(b)(ii) below, Pledgor has no right to
draw Checks against the Collateral Accounts. 

 

(i)  By Negotiable Instruments Delivered to Pledgor.  Intercreditor Agent may, in accordance with
the Disbursement Agreement, periodically deliver to Pledgor preauthorized “Checks”
(as defined in Section 3-103(2)(b) of the UCC) drawn against the
Disbursement Account in specific amounts to the order of specific vendors or
other third party payees of Pledgor and appropriately executed by or for
Intercreditor Agent.  On delivery of
Checks to Pledgor, Intercreditor Agent shall cause funds in the Disbursement
Account to be blocked to the extent necessary to pay such items, and shall not
otherwise disburse or apply such related funds (including to make Investments
pursuant to Section 4(b)) unless it has withdrawn the authorization to
deliver such items to the payees in advance of delivery to the payee as set
forth in the following sentence.  If any
Potential Event of Default or Event of Default has occurred and is continuing,
Intercreditor Agent may notify Pledgor that it has withdrawn Pledgor’s right to
deliver specified Checks or similar items, or unblocked the related funds, by
written notice.  Unless so notified by
Intercreditor Agent in advance of delivery to the payee, Pledgor is authorized
to deliver such Checks to the appropriate payees.  If so notified by Intercreditor Agent in
advance of delivery of any Check to the payee thereof, Pledgor shall promptly
return the Check or similar items to Intercreditor Agent.  

 

(ii)  By Pledgor.  Except during any Suspension Period, Pledgor
may by Check or other means draw funds from the Phase II Hotel/Casino Cash
Management

 

12

 

Account for the purposes set forth in the Disbursement Agreement.  During any Suspension Period, the Phase II
Hotel/Casino Cash Management Account shall be blocked and Pledgor shall have no
right to draw any amounts therefrom.

 

SECTION 9. 
Representations
and Warranties By Financial Institution.  Financial Institution hereby represents and
warrants to Pledgor and Intercreditor Agent as follows:

 

(a)  Corporate Power. 
Financial Institution has all necessary corporate power and authority to
enter into and perform this Agreement.

 

(b)  Execution Authorized. 
The execution, delivery and performance of this Agreement by Financial
Institution have been duly authorized by all necessary corporate action on the
part of Financial Institution.

 

(c)  Financial Institution. 
Financial Institution maintains securities accounts for others in the
ordinary course of its business, will maintain the Collateral Accounts in such
fashion and therefore is a “securities intermediary” (as that term is defined
in Section 8-102(a)(14) of the UCC) and is acting in such capacity with
respect to the Collateral Accounts. 
Financial Institution is not a “clearing corporation” (as that term is
defined in Section 8-102(a)(5) of the UCC).  Financial Institution is an organization that
is engaged in the business of banking and is therefore a “Bank” within the
meaning of Section 9-102(a)(8) of the UCC.

 

(d)  Securities Accounts. 
Each of the Collateral Accounts (other than the Phase II Hotel/Casino
Cash Management Account) is a “securities account” as defined in Section 8-501
of the UCC.

 

(e)  Deposit Accounts.  The
Phase II Hotel/Casino Cash Management Account is a “deposit account” as defined
in 9-102(a)(29) of the UCC.

 

SECTION 10. 
Representations
and Warranties. 
Pledgor represents and warrants as follows:

 

(a)  Ownership of Collateral; Security Interest; Perfection and Priority.  Pledgor is (or at the time of transfer
thereof to Financial Institution will be) the legal and beneficial owner of the
Collateral from time to time transferred by Pledgor to Financial Institution,
as agent for Intercreditor Agent, free and clear of any Lien except for the
security interest created by this Agreement. 
The pledge and assignment of the Collateral pursuant to this Agreement
creates a valid security interest in the Collateral securing the payment of the
Obligations.  Assuming compliance by
Financial Institution with this Agreement, Intercreditor Agent will have a
perfected security interest in the Collateral senior in priority to any other
security interest created by Pledgor.

 

(b)  Governmental Authorizations. 
Except as may be required under Nevada gaming laws, no authorization,
approval or other action by, and no notice to or filing with, any Governmental
Instrumentality is required for either (i) the grant by Pledgor of the security
interest granted hereby, (ii) the execution, delivery or performance of this
Agreement by Pledgor,

 

13

 

or (iii) the perfection of or the exercise by Intercreditor Agent or
Financial Institution of its rights and remedies hereunder (except as may have
been taken by or at the direction of Pledgor).

 

(c)  Other Information. 
All information heretofore, herein or hereafter supplied to
Intercreditor Agent or Financial Institution by or on behalf of Pledgor with
respect to the Collateral and the establishment of the Collateral Accounts is
accurate and complete in all material respects.

 

SECTION 11. 
Further
Assurances.

 

(a)  Pledgor.  Pledgor
agrees that from time to time, at the expense of Pledgor, Pledgor shall
promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary or reasonably desirable, or that
Intercreditor Agent may reasonably request, in order to perfect and protect any
security interest granted or purported to be granted hereby or to enable
Intercreditor Agent or Financial Institution to exercise and enforce its rights
and remedies hereunder with respect to any Collateral.  Without limiting the generality of the
foregoing, Pledgor shall (a) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or notices, as may
be necessary or reasonably desirable, or as Intercreditor Agent may reasonably
request, in order to perfect and preserve the security interests granted or
purported to be granted hereby, and (b) at Intercreditor Agent’s request,
appear in and defend any action or proceeding that may affect Pledgor’s title
to or Intercreditor Agent’s security interest in all or any part of the
Collateral.

 

(b)  Financial Institution. 
Financial Institution shall take such further actions as Intercreditor
Agent shall reasonably request as being necessary or desirable to maintain or
achieve perfection or priority of Intercreditor Agent’s security interest with
respect to the Collateral and to permit Intercreditor Agent to exercise its
rights with respect to the Collateral.

 

SECTION 12. 
Transfers
and other Liens. 
Pledgor agrees that, except for releases of funds from the Collateral
Accounts pursuant to the Disbursement Agreement, transactions not in violation
of Section 8, investment actions permitted in Section 4(b) and the security
interest created by this Agreement, it shall not (a) sell, assign (by operation
of law or otherwise), redeem or otherwise dispose of any of the Collateral or
(b) create or suffer to exist any Lien upon or with respect to any of the
Collateral.

 

SECTION 13. 
Intercreditor
Agent Appointed Attorney-in-Fact; Intercreditor Agent Performance.

 

(a)  Intercreditor Agent Appointed Attorney-in-Fact.  Pledgor hereby irrevocably appoints
Intercreditor Agent as Pledgor’s attorney-in-fact, with full authority in the
place and stead of Pledgor and in the name of Pledgor, Intercreditor Agent or
otherwise, from time to time in Intercreditor Agent’s discretion to take any
action and to execute any instrument that Intercreditor Agent may deem
necessary or advisable to accomplish the purposes of this Agreement, including
(a) to file one or more financing or continuation statements, or amendments
thereto, relative to all or any part of the Collateral without the signature of
Pledgor and (b) to receive, endorse and collect any instruments or other
Investments made payable to

 

14

 

Pledgor representing any
dividend, principal or interest payment or other distribution in respect of the
Collateral or any part thereof and to give full discharge for the same.

 

(b)  Performance by Intercreditor Agent.  If Pledgor fails to perform any agreement
contained herein, Intercreditor Agent may itself perform, or cause performance
of, such agreement, and the expenses of Intercreditor Agent incurred in
connection therewith shall be payable by Pledgor under Section 16.

 

SECTION 14. 
Remedies.

 

(a)  Transfer or Sequestration of Collateral after Potential Event of
Default or Event of Default. 
If any Potential Event of Default or Event of Default shall have
occurred and be continuing, Intercreditor Agent may instruct Financial
Institution to (i) sell or redeem any Investments, (ii) transfer any or all of
the Collateral constituting Cash to a Deposit Account or transfer any or all of
the Collateral to any account designated by Intercreditor Agent, including
account or accounts established in Intercreditor Agent’s name (whether at
Intercreditor Agent or Financial Institution or otherwise), (iii) register
title to any Collateral in any name specified by Intercreditor Agent, including
the name of Intercreditor Agent or any of its nominees or agents, without
reference to any interest of Pledgor, or (iv) otherwise deal with the
Collateral as directed by Intercreditor Agent.

 

(b)  Rights of Intercreditor Agent after Event of Default.  If any Event of Default shall have occurred
and be continuing, Intercreditor Agent may exercise in respect of the
Collateral, in addition to all other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party on
default under the UCC (whether or not the UCC applies to the affected
Collateral), and Intercreditor Agent may also in its sole discretion sell the
Collateral or any part thereof in one or more parcels at public or private
sale, at any exchange or broker’s board or at any of Intercreditor Agent’s
offices or elsewhere, for cash, on credit or for future delivery, at such time
or times and at such price or prices and upon such other terms as Intercreditor
Agent may deem commercially reasonable, irrespective of the impact of any such
sales on the market price of the Collateral. 
Each purchaser at any such sale shall hold the property sold absolutely
free from any claim or right on the part of Pledgor, and Pledgor hereby waives
(to the extent permitted by applicable law) all rights of redemption, stay or
appraisal which it now has or may at any time in the future have under any rule
of law or statute now existing or hereafter enacted.  Intercreditor Agent shall not be obligated to
make any sale of Collateral regardless of notice of sale having been
given.  Intercreditor Agent may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.

 

(c)  Agreement as to Manner of Sale.  Pledgor hereby agrees that the Collateral is
of a type customarily sold on recognized markets and, accordingly, that no
notice to any Person is required before any sale of any of the Collateral
pursuant to the terms of this Agreement; provided
that, without prejudice to the foregoing, Pledgor agrees that, to
the extent notice of any such sale shall be required by law, at least ten days’
notice to Pledgor of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable notification.

 

15

 

(d)  Deficiency.  If the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay all the Obligations, Pledgor shall be liable for the deficiency and the
fees of any attorneys employed by Intercreditor Agent to collect such
deficiency.

 

(e)  Set-off.  Anything
contained herein to the contrary notwithstanding, all amounts in the Collateral
Accounts shall be subject to Intercreditor Agent’s or any of the Secured
Parties’ rights of set-off. 

 

SECTION 15. 
Application
of Proceeds.  If
any Event of Default shall have occurred and be continuing, all cash included
as Collateral and all proceeds received by Intercreditor Agent in respect of
any sale or redemption of, collection from, or other realization upon all or
any part of the Collateral may, in the discretion of Intercreditor Agent, be
held by or for Intercreditor Agent as Collateral for, or then, or at any other
time thereafter, applied in full or in part by Intercreditor Agent against, the
Obligations as provided in the Intercreditor Agreement.  Upon the termination of the Intercreditor
Agreement, all proceeds shall be applied first to the Bank Secured Obligations
and second to the Mortgage Notes Secured Obligations.

 

SECTION 16. 
Limitations
on Duties; Exculpation; Indemnity; Expenses.

 

(a)  Financial Institution.

 

(i)  Limitation on Duties.  Financial Institution’s duties hereunder are
only those specifically provided herein, and Financial Institution shall incur
no liability whatsoever for any actions or omissions hereunder except for any
such liability arising out of or in connection with Financial Institution’s
gross negligence or willful misconduct. 
Financial Institution has no obligation to inquire into, or to ensure,
the sufficiency of this Agreement or the arrangements described hereunder to
satisfy any objectives of Intercreditor Agent or Pledgor.  Financial Institution shall have no duty to
supervise or to provide investment counseling or advice to Pledgor or
Intercreditor Agent with respect to the purchase, sale, retention or other
disposition of any Financial Assets held hereunder.  Except as specifically otherwise provided in
this Agreement, Financial Institution shall not be responsible for enforcing
compliance by the other parties to this Agreement with their respective duties
and obligations to each other under this or any other Agreement.

 

(ii)  Consultation with Counsel.  Financial Institution may consult with, and
obtain advice from, legal counsel as to the construction of any of the
provisions of this Agreement, and shall incur no liability in acting in good
faith in accordance with the reasonable advice and opinion of such counsel.

 

(iii)  Indemnification.  Pledgor agrees to indemnify Financial
Institution from and against any and all claims, losses, liabilities and
expenses (including reasonable attorneys’ fees and expenses) in any way
relating to, growing out of or resulting from this Agreement or the performance
of its obligations hereunder, except to the extent arising out of or in
connection with Financial Institution’s gross negligence or wilful misconduct.

 

(iv)  Reasonable Reliance.  Financial Institution shall be fully
protected and shall suffer no liability in acting in accordance with any
written instructions

 

16

 

reasonably
believed by it to have been given (A) by Intercreditor Agent with respect to
any aspect of the operation of the Collateral Accounts (including any such
instructions relating to any investment or transfer of any amounts held therein
or (B) by Pledgor, to the extent provided in Section 4(b), with respect to
the Collateral Accounts.

 

(b)  Intercreditor Agent.

 

(i)  Exculpation.  The powers conferred on Intercreditor Agent
hereunder are solely to protect its interest in the Collateral and shall not
impose any duty upon it to exercise any such powers.  Except for the exercise of reasonable care in
the custody of any Collateral in its possession and the accounting for moneys
actually received by it hereunder, Intercreditor Agent shall have no duty as to
any Collateral, it being understood that Intercreditor Agent shall have no
responsibility for (a) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relating to any
Collateral, whether or not Intercreditor Agent has or is deemed to have
knowledge of such matters, (b) taking any necessary steps (other than steps
taken in accordance with the standard of care set forth above to maintain
possession of the Collateral) to preserve rights against any parties with
respect to any Collateral, (c) taking any necessary steps to collect or realize
upon the Bank Secured Obligations or Mortgage Notes Secured Obligations or any
guarantee therefor, or any part thereof, or any of the Collateral, (d)
initiating any action to protect the Collateral against the possibility of a
decline in market value, (e) any loss resulting from Investments made, held or
sold pursuant to Section 4, except for a loss resulting from Intercreditor
Agent’s gross negligence or wilful misconduct in complying with Section 4,
or (f) determining (i) the correctness of any statement or calculation made by
Pledgor in any written instructions or (ii) whether any transfer to the
Collateral Accounts is proper. 
Intercreditor Agent shall be deemed to have exercised reasonable care in
the custody and preservation of Collateral in its possession if such Collateral
is accorded treatment substantially equal to that which Intercreditor Agent
accords its own property of like kind. 
In addition to the foregoing and without limiting the generality
thereof, Intercreditor Agent shall not be responsible for any actions or
omissions of Financial Institution.

 

(ii)  Indemnification.  Pledgor agrees to indemnify Intercreditor
Agent from and against any and all claims, losses and liabilities in any way
relating to, growing out of or resulting from this Agreement and the
transactions contemplated hereby (including enforcement of this Agreement),
except to the extent such claims, losses or liabilities result solely from
Intercreditor Agent’s gross negligence or wilful misconduct as finally
determined by a court of competent jurisdiction.

 

(iii)  Reasonable Reliance.  Intercreditor Agent shall be fully protected
and shall suffer no liability in acting in accordance with any written
instructions reasonably believed by it to have been given by Pledgor, to the
extent provided in Section 4(b), with respect to any Investments of any
amounts held for the credit of the Collateral Accounts.

 

(iv)  Expenses. 
Pledgor shall pay to Intercreditor Agent upon demand the amount of any
and all costs and expenses, including the reasonable fees and expenses of its
counsel and of any experts and agents, that Intercreditor Agent may reasonably
incur

 

17

 

in connection
with (i) the administration of this Agreement, (ii) the custody, preservation,
use or operation of, or the sale of, collection from, or other realization
upon, any of the Collateral, (iii) the exercise or enforcement of any of the
rights of Intercreditor Agent hereunder, or (iv) the failure by Pledgor to
perform or observe any of the provisions hereof.

 

SECTION 17. 
Resignation
and Removal of Financial Institution.

 

(a)  Removal.  Financial
Institution may be removed at any time by written notice given by Intercreditor
Agent to Financial Institution and Pledgor, but such removal shall not become
effective until a successor Financial Institution shall have been appointed by
Intercreditor Agent and shall have accepted such appointment in writing.

 

(b)  Resignation. 
Financial Institution may resign at any time by giving not less than
thirty days’ written notice to Intercreditor Agent and Pledgor, but such
removal shall not become effective until a successor Financial Institution
shall have been appointed by Intercreditor Agent and shall have accepted such
appointment in writing.  If an instrument
of acceptance by a successor Financial Institution shall not have been
delivered to the resigning Financial Institution within thirty days after the
giving of any such notice of resignation, the resigning Financial Institution
may, at the expense of Pledgor, petition any court of competent jurisdiction
for the appointment of a successor Financial Institution.

 

(c)  Successor Financial Institution.  Any successor Financial Institution shall be
(i) Goldman, Sachs & Co., (ii) The Bank of Nova Scotia Trust Company of New
York, or (iii) a corporation qualified to, and located in, New York, which (A)
is authorized to exercise corporation trust powers, (B) is subject to
supervision or examination by the applicable Governmental Authority, (C) has a
combined capital and surplus of at least Five Hundred Million Dollars
(US$500,000,000), and (D) has a long-term credit rating of not less than “A-”
or “A3”, respectively, by any Rating Agency; and provided, that
any such bank with a long-term credit rating of “A-” or “A3”‘ shall not cease
to be eligible to act as Financial Institution upon a downward change in either
such rating of no more than one category or grade of such minimum rating, as
the case may be.  If any successor
Financial Institution does not accept deposits for non-fiduciary customers it
may establish, in its name as custodian under this agreement, appropriate
deposit accounts (“Substitute Deposit
Accounts”) to hold any cash balances which would otherwise have been
held for the credit of the Pledgor.  The
Substitute Deposit Accounts may be established with any depository institution,
including a depository institution affiliated with the successor Financial
Institution, that (1) has one of the three highest deposit ratings available
from any Rating Agency or, if the institution is not rated, is a subsidiary of
a holding company that has one of the three highest long term credit ratings
available from any Rating Agency, (2) is a member of the Federal Deposit Insurance
Corporation, and (3) has Tier 1 capital (as defined in such regulations of its
primary Federal banking regulator) of not less than $500,000,000.  In such circumstances, the successor
Financial Institution shall credit the Substitute Deposit Account to the
Collateral Accounts.

 

(d)  Process of Succession. 
Upon the appointment of a successor Financial Institution and its
acceptance of such appointment, the resigning or removed Financial Institution
shall transfer all items of Collateral held by it to such successor (which
items of Collateral shall

 

18

 

be transferred to an
appropriate new Collateral Account established and maintained by such
successor).  Following such appointment
all references herein to Financial Institution shall be deemed a reference to
such successor; provided that the
provisions of Section 16(a) hereof shall continue to inure to the benefit
of the resigning or removed Financial Institution with respect to any actions
taken or omitted to be taken by it under this Agreement while it was Financial
Institution hereunder.

 

SECTION 18. 
Continuing
Security Interest; Termination of Obligations of Financial Institution.  

 

(a)  This Agreement shall create
a continuing security interest in the Collateral and shall (i) remain in full
force and effect until the Termination Date, (ii) be binding upon Pledgor, its
successors and assigns, and (iii) inure, together with the rights and remedies
of Intercreditor Agent hereunder, to the benefit of Intercreditor Agent, the
Secured Parties and their respective successors, transferees and assigns.  On the Termination Date, the security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to Pledgor.  Upon any such
termination Intercreditor Agent shall, at Pledgor’s expense, execute and
deliver to Pledgor such documents as Pledgor shall reasonably request to
evidence such termination (and, in the case of UCC termination statements,
Pledgor shall, upon such delivery, be authorized to file such termination
statements in the appropriate filing offices) and Pledgor shall be entitled to
the return, upon its request and at its expense, against receipt and without
recourse to Intercreditor Agent, of such of the Collateral as shall not have
been sold or otherwise applied pursuant to the terms hereof.  Financial Institution shall not be released
from its obligations hereunder, and shall continue to maintain any Collateral
in accordance with this Agreement, until notified in writing by Intercreditor
Agent that this Agreement has terminated and so long as Intercreditor Agent has
not withdrawn such notification.

 

(b)  In the event that any part
of the Collateral is withdrawn in accordance with the Credit Agreement, such
Collateral will be transferred or otherwise disposed of, and released free and
clear of the Liens created by this Agreement and the Intercreditor Agent, at
the reasonable request and expense of the Pledgor, will duly and promptly
assign, transfer, deliver and release to the Pledgor or its designee (without
recourse and without any representation or warranty) such of the Collateral as
is then being (or has been) so transferred or otherwise disposed of or
released.  In connection with any disposition
or release pursuant to this Section 18, the Intercreditor Agent shall, at the
Pledgor’s expense, execute and deliver to the Pledgor such documents (including
UCC-3 termination statements, which, upon such delivery, Pledgor shall be
authorized to file in the appropriate filing offices) as the Pledgor may
reasonably request.

 

SECTION 19. 
Intercreditor
Agent. 
Intercreditor Agent has been appointed to act as Intercreditor Agent
hereunder by Secured Parties pursuant to the Intercreditor Agreement.  Intercreditor Agent shall be obligated, and
shall have the right hereunder, to make demands, to give notices, to exercise
or refrain from exercising any rights, and to take or refrain from taking any
action (including, without limitation, the release or substitution of
Collateral), solely in accordance with this Agreement, the Disbursement
Agreement and the Intercreditor Agreement. 
Upon any termination of the Intercreditor Agreement, the Intercreditor
Agent may assign this

 

19

 

Agreement to the Administrative
Agent and the Mortgage Notes Indenture Trustee and their respective successors
or assigns acting on their behalf.

 

SECTION 20. 
Amendments,
Etc.  No amendment
or waiver of any provision of this Agreement, or consent to any departure by
any party herefrom, shall in any event be effective unless the same shall be in
writing and signed by the other parties, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which it was given.

 

SECTION 21. 
Notices.  Any communications between the parties hereto
or notices provided herein to be given may be given to the address of the party
as set forth under such party’s name on the signature pages hereof.  All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be considered as
properly given (a) if delivered in person, (b) if sent by reputable overnight
delivery service, (c) in the event overnight delivery services are not readily
available, if mailed by first class mail, postage prepaid, registered or
certified with return receipt requested or (d) if sent by prepaid telex, or by
telecopy with correct answer back received. 
Notice so given shall be effective upon receipt by the addressee, except
that communication or notice so transmitted by telecopy or other direct written
electronic means shall be deemed to have been validly and effectively given on
the day (if a Banking Day and, if not, on the next following Banking Day) on
which it is validly transmitted if transmitted before 4 p.m., recipient’s time,
and if transmitted after that time, on the next following Banking Day; provided, however,
that if any notice is tendered to an addressee and the delivery thereof is
refused by such addressee, such notice shall be effective upon such
tender.  Any party shall have the right
to change its address for notice hereunder to any other location by giving of
no less than twenty (20) days’ notice to the other parties in the manner set
forth hereinabove.

 

SECTION 22. 
Failure
or Indulgence Not Waiver; Remedies Cumulative.  No failure or delay on the part of
Intercreditor Agent in the exercise of any power, right or privilege hereunder
shall impair such power, right or privilege or be construed to be a waiver of
any default or acquiescence therein, nor shall any single or partial exercise
of any such power, right or privilege preclude any other or further exercise
thereof or of any other power, right or privilege.  All rights and remedies existing under this
Agreement are cumulative to, and not exclusive of, any rights or remedies
otherwise available.

 

SECTION 23. 
Severability.  In case any provision in or obligation under
this Agreement shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.

 

SECTION 24. 
Headings.  Section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute
a part of this Agreement for any other purpose or be given any substantive
effect.

 

SECTION 25. 
Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE
OF NEW YORK, WITHOUT REGARD

 

20

 

TO
CONFLICTS OF LAWS PRINCIPLES.  REGARDLESS OF ANY PROVISION IN ANY OTHER
AGREEMENT, FOR PURPOSES OF THE UCC, WITH RESPECT TO EACH COLLATERAL ACCOUNT NEW
YORK SHALL BE DEEMED TO BE THE BANK’S JURISDICTION (WITHIN THE MEANING OF
SECTION 9-304 OF THE UCC) AND THE SECURITIES INTERMEDIARY’S JURISDICTION
(WITHIN THE MEANING OF SECTION 8-110 OF THE UCC).

 

SECTION 26.  Consent to
Jurisdiction and Service of Process. 
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST PLEDGOR ARISING OUT OF OR
RELATING TO THIS AGREEMENT MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE STATE OF NEW YORK, AND BY EXECUTION AND DELIVERY
OF THIS AGREEMENT PLEDGOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS AND IRREVOCABLY
AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS
AGREEMENT.  Pledgor
hereby agrees that service of all process in any such proceeding in any such
court may be made by registered or certified mail, return receipt requested, to
Pledgor at its address provided in Section 21, such service being hereby
acknowledged by Pledgor to be sufficient for personal jurisdiction in any
action against Pledgor in any such court and to be otherwise effective and
binding service in every respect.  Nothing
herein shall affect the right to serve process in any other manner permitted by
law or shall limit the right of Intercreditor Agent to bring proceedings
against Pledgor in the courts of any other jurisdiction.

 

SECTION 27. 
Waiver of Jury Trial.  PLEDGOR, FINANCIAL INSTITUTION AND
INTERCREDITOR AGENT HEREBY AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT.  The
scope of this waiver is intended to be all-encompassing of any and all disputes
that may be filed in any court and that relate to the subject matter of this
transaction, including contract claims, tort claims, breach of duty claims, and
all other common law and statutory claims. 
Pledgor and Intercreditor Agent each acknowledge that this waiver is a
material inducement for Pledgor and Intercreditor Agent to enter into a
business relationship, that Pledgor and Intercreditor Agent have already relied
on this waiver in entering into this Agreement and that each will continue to
rely on this waiver in their related future dealings.  Pledgor and Intercreditor Agent further
warrant and represent that each has reviewed this waiver with its legal
counsel, and that each knowingly and voluntarily waives its jury trial rights
following consultation with legal counsel. 
THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.  In the event of litigation, this Agreement
may be filed as a written consent to a trial by the court.

 

SECTION 28. 
Counterparts.  This Agreement may be executed in one or more
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple

 

21

 

separate counterparts and
attached to a single counterpart so that all signature pages are physically
attached to the same document.

 

SECTION 29. 
Intercreditor
Agent’s Representative. 
The Intercreditor Agent hereby authorizes the entity from time to time
acting as the Disbursement Agent under the Disbursement Agreement to, from time
to time, act on its behalf hereunder. 
Until the Intercreditor Agent notifies Financial Institution and Pledgor
to the contrary, any such Disbursement Agent shall be a “representative” (as
defined in Section 1-201(35) of the Code) of the Intercreditor Agent and, as
such, any Entitlement Orders or other instructions or actions issued or taken
by such Disbursement Agent hereunder shall be as effective as if issued or
taken directly by the Intercreditor Agent.

 

 

[Remainder of page intentionally left blank]

 

22

 

IN WITNESS WHEREOF,
the undersigned have executed this Agreement as of the date first set forth
above.

 

	
  PLEDGOR:

  
	
   

  	
   

  
	
   

  	
  LAS VEGAS SANDS, INC.,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HARRY MILTENBERGER

  	
   

  
	
   

  	
   

  	
  Name: Harry
  Miltenberger

  
	
   

  	
   

  	
  Title: VP
  Finance, Secretary and Chief Accounting Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VENETIAN CASINO RESORT, LLC,

  
	
   

  	
  a Nevada limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  LAS VEGAS SANDS INC.,
  its managing member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ HARRY MILTENBERGER

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Harry Miltenberger

  	
   

  
	
   

  	
   

  	
   

  	
  Title: VP Finance, Secretary and Chief Accounting Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LIDO CASINO RESORT, LLC,

  
	
   

  	
  a Nevada limited liability company

  
	
   

  	
   

  
	
   

  	
  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 and Chief Accounting Officer

  
										

 

Notice Address for Pledgor:

3355 Las Vegas Blvd South

Las Vegas, Nevada 89109

Attention: 
General Counsel

Facsimile Number:  (702) 414-4421

 

 

	
  FINANCIAL INSTITUTION:

  
	
   

  
	
   

  	
  THE BANK OF NOVA SCOTIA,
  a Canadian chartered bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ALAN PENDERGAST

  	
   

  
	
   

  	
  Name: Alan Pendergast

  
	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
  Notice Address:

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  	
  580 California Street

  
	
   

  	
   

  	
  San Francisco, CA 94104

  
	
   

  	
  Attention:

  	
  Alan Pendergast

  
	
   

  	
  Facsimile Number:

  	
  (415) 397-0791

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  	
  600 Peachtree Street, N.E.

  
	
   

  	
   

  	
  Atlanta, GA 30308

  
	
   

  	
  Attention:

  	
  Hilma Gabbidon and Vicki Gibson

  
	
   

  	
  Facsimile Number:

  	
  (404) 888-8998

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  INTERCREDITOR AGENT:

  
	
   

  
	
   

  	
  THE BANK OF NOVA SCOTIA,
  a Canadian chartered bank, as Intercreditor Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ALAN PENDERGAST

  	
   

  
	
   

  	
  Name: Alan Pendergast

  
	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
  Notice Address:

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  	
  580 California Street

  
	
   

  	
   

  	
  21st Floor

  
	
   

  	
   

  	
  San Francisco, CA 94104

  
	
   

  	
  Attention:

  	
  Alan Pendergast

  
	
   

  	
  Facsimile Number:

  	
  (415) 397-0791

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  	
  Loan Administration

  
	
   

  	
   

  	
  600 Peachtree Street, N.E.

  
	
   

  	
   

  	
  Atlanta, GA 30308

  
	
   

  	
  Attention:

  	
  Hilma Gabbidon and Vicki Gibson

  
	
   

  	
  Facsimile Number:

  	
  (404) 888-8998

  
					

 

2Exhibit 10.69

 

AMENDMENT NO. 2 TO UNSECURED INDEMNITY AGREEMENT

 

THIS AMENDMENT NO. 2 TO UNSECURED INDEMNITY AGREEMENT
(the “Agreement”) is entered into as of September 30, 2004, by LAS
VEGAS SANDS, INC., a Nevada corporation (“LVSI”), and VENETIAN CASINO RESORT,
LLC, a Nevada limited liability company (“VCR” and jointly and severally
with LVSI, the “Company”), to and for the benefit of U.S. Bank National
Association (the “Mortgage Notes Indenture Trustee”), and to the extent
no otherwise referenced, the Indemnified Parties (as hereinafter defined) and
amends the Unsecured Indemnity Agreement (the “Indemnity”), dated as of
June 4, 2002, as amended on August 20, 2004, by the Company to and for the
benefit of the Mortgage Notes Indenture Trustee.

 

WHEREAS, pursuant to that certain Indenture, dated as
of June 4, 2002, as amended, by and between the Company, certain subsidiaries
of the Company and the Mortgage Notes Indenture Trustee (the “Indenture”),
VCR and LVSI have issued those certain 11.00% Mortgage Notes due 2010 (the “Mortgage
Notes”).  Capitalized terms used
herein, but not otherwise defined herein, shall have the meaning assigned to
such terms in the Indenture.

 

WHEREAS, the Mortgage Notes are secured by, among
other things, certain deeds of trust, which deeds of trust encumber the real
property described therein, and the improvements now or hereafter construed
thereon.

 

WHEREAS, the Company desires to amend the Indemnity to
cover certain additional deeds of trust for the benefit of the Mortgage Notes
Indenture Trustee.

 

NOW, THEREFORE, in consideration of the foregoing and
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company covenants and agrees to and for the benefit of the
Mortgage Notes Indenture Trustee and the Mortgage Note Holders as follows:

 

1.             Definitions. 
The definition of “Deed of Trust” in the Indemnity is hereby amended and
restated in its entirety as follows:

 

“Deed of Trust” means, collectively, (1) that
certain Deed of Trust, Leasehold Deed of Trust, Assignment of Rents and Leases,
Security Agreement and Fixture Filing dated as of June 4, 2002, made by LVSI
and VCR, as trustor, to First American Title Insurance Company, as trustee, for
the benefit of the Mortgage Notes Indenture Trustee, as beneficiary, as amended
from time to time; (2) if and when entered into, that certain Deed of Trust,
Assignment of Rents and Leases, Security Agreement and Fixture Filing to be
entered into by VCR, as trustor, to First American Title Insurance Company, as
trustee, for the benefit of the Mortgage Notes Indenture Trustee, as
beneficiary, which deed of trust shall be entered into promptly after such time
as (A) a separate legal parcel has been created for the property leased by Lido
Casino Resort, LLC, a Nevada limited liability company (“Lido Casino Resort”),
to VCR pursuant to

 

 

that certain phase 1A Lease, dated as of even date herewith (the “Phase
1A Lease”), by and between Lido Casino Resort, as lessor, and VCR, as
lessee, and (B) such property has been conveyed by Lido Casino Resort to VCR,
all in accordance with the terms of the Phase 1A Lease; (3) that certain Deed
of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing
dated May 6, 2004 made by LVSI, as trustor, to First American Title Insurance
Company, as trustee, for the benefit of the Mortgage Notes Indenture Trustee,
as beneficiary, as amended from time to time; and (4) that certain Deed of
Trust, Leasehold Deed of Trust, Assignment of Rents and Leases, Security
Agreement and Fixture Filing dated as of the date hereof, made by Lido Casino
Resort, LLC, as trustor, to First American Title Insurance Company, as trustee,
for the benefit of the Mortgage Notes Indenture Trustee, as beneficiary, as
amended from time to time.

 

2.             Remainder of Indemnity Unchanged.  Except as expressly modified above, the
Indemnity remains unchanged and in full force and effect.

 

[Remainder of page intentionally left blank]

 

2

 

IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first set forth above.

 

	
   

  	
  LAS VEGAS SANDS, INC.,

  
	
   

  	
   a Nevada
  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ROBERT G. GOLDSTEIN

  	
   

  
	
   

  	
   

  	
  Name: Robert G. Goldstein

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VENETIAN CASINO RESORT, LLC,

  
	
   

  	
   a Nevada
  limited liability company

  
	
   

  	
   

  
	
   

  	
  By: LAS VEGAS SANDS, INC.,

  
	
   

  	
  its managing
  member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ROBERT G. GOLDSTEIN

  	
   

  
	
   

  	
   

  	
  Name: Robert G. Goldstein

  
	
   

  	
   

  	
  Title: Senior Vice President

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