Construction & Revolving Loan Agreement

EXHIBIT 10(18)


CONSTRUCTION/REVOLVING LOAN AGREEMENT


Dated as of September 15, 1995


among


NEW YORK-NEW YORK HOTEL, LLC


THE BANKS HEREIN NAMED


BANK OF SCOTLAND
and
SOCIETE GENERALE,
as Lead Managers


FIRST INTERSTATE BANK OF NEVADA,
as Co-Agent


and


BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Managing Agent


TABLE OF CONTENTS
-----------------


Page


Article 1 DEFINITIONS AND ACCOUNTING TERMS............... 1

1.1 Defined Terms.................................. 1
1.2 Use of Defined Terms........................... 36
1.3 Accounting Terms............................... 36
1.4 Rounding....................................... 37
1.5 Exhibits and Schedules......................... 37
1.6 References to "Borrower and its Subsidiaries".. 37
1.7 Miscellaneous Terms............................ 37
Article 2 LOANS AND LETTERS OF CREDIT.................... 38

2.1 Loans-General.................................. 38
2.2 Alternate Base Rate Loans...................... 39
2.3 Eurodollar Rate Loans.......................... 39
2.4 Letters of Credit.............................. 40
2.5 Voluntary Reduction of Commitment.............. 44
2.6 Contingent Reduction of Commitment............. 44
2.7 Automatic Reduction of Commitment.............. 45
2.8 Scheduled Reduction of Commitment.............. 45
2.9 Optional Termination of Commitment............. 45
2.10 Managing Agent's Right to Assume Funds
Available for Advances......................... 45
2.11 Swing Line..................................... 46
2.12 Collateral and Guaranty........................ 48
2.13 Senior Indebtedness............................ 48
Article 3 PAYMENTS AND FEES.............................. 49

3.1 Principal and Interest......................... 49
3.2 Arrangement Fee................................ 50
3.3 Upfront Fees................................... 50
3.4 Commitment Fees................................ 51
3.5 Letter of Credit Fees.......................... 51
3.6 Agency Fees.................................... 51
3.7 Increased Commitment Costs..................... 52
3.8 Eurodollar Costs and Related Matters........... 52
3.9 Late Payments.................................. 57
3.10 Computation of Interest and Fees............... 57
3.11 Non-Banking Days............................... 58
3.12 Manner and Treatment of Payments............... 58
3.13 Funding Sources................................ 59
3.14 Failure to Charge Not Subsequent Waiver........ 60
3.15 Managing Agent's Right to Assume Payments Will
be Made by Borrower............................ 60
3.16 Fee Determination Detail....................... 60
3.17 Survivability.................................. 60


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Article 4 REPRESENTATIONS AND WARRANTIES................. 61


4.1 Existence and Qualification; Power; Compliance
With Laws...................................... 61
4.2 Authority; Compliance With Other Agreements
and Instruments and Government Regulations..... 61
4.3 No Governmental Approvals Required............. 62
4.4 Subsidiaries................................... 62
4.5 Financial Statements........................... 63
4.6 No Other Liabilities; No Material Adverse
Changes........................................ 64
4.7 Title to Property.............................. 64
4.8 Intangible Assets.............................. 64
4.9 Public Utility Holding Company Act............. 64
4.10 Litigation..................................... 64
4.11 Binding Obligations............................ 65
4.12 No Default..................................... 65
4.13 ERISA.......................................... 65
4.14 Regulations G, T, U and X; Investment Company
Act............................................ 65
4.15 Disclosure..................................... 66
4.16 Tax Liability.................................. 66
4.17 Projections.................................... 66
4.18 Hazardous Materials............................ 66
4.19 Security Interests............................. 67
Article 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION
AND REPORTING REQUIREMENTS).................... 68

5.1 Payment of Taxes and Other Potential Liens..... 68
5.2 Preservation of Existence...................... 68
5.3 Maintenance of Properties...................... 68
5.4 Maintenance of Insurance....................... 69
5.5 Compliance With Laws........................... 69
5.6 Inspection Rights.............................. 69
5.7 Keeping of Records and Books of Account........ 69
5.8 Compliance With Agreements..................... 69
5.9 Use of Proceeds................................ 70
5.10 New Subsidiaries............................... 70
5.11 Hazardous Materials Laws....................... 70
5.12 Change of Name................................. 70
5.13 Gaming Licenses................................ 70
5.14 Prepayment of Equipment Lease.................. 71
Article 6 NEGATIVE COVENANTS............................. 72

6.1 Payment of Subordinated Obligations............ 72
6.2 Disposition of Property........................ 72
6.3 Mergers........................................ 72
6.4 Hostile Acquisitions........................... 72
6.5 Distributions.................................. 72
6.6 ERISA.......................................... 73

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6.7 Change in Nature of Business................... 73
6.8 Liens and Negative Pledges..................... 73
6.9 Indebtedness and Guaranty Obligations.......... 74
6.10 Transactions with Affiliates................... 74
6.11 Leverage Ratio................................. 75
6.12 Fixed Charge Coverage Ratio.................... 75
6.13 Capital Expenditures........................... 75
6.14 Investments.................................... 76
6.15 Subsidiary Indebtedness........................ 76
6.16 Amendments to Operating Agreement.............. 76
Article 7 CONSTRUCTION PERIOD COVENANTS.................. 78

7.1 Construction of Project........................ 78
7.2 Amendments to Plans and Budgets................ 78
7.3 Timetable...................................... 78
7.4 Construction Requirements...................... 78
7.5 Construction Services Group.................... 78
7.6 Notice of Changes.............................. 78
7.7 Construction Progress Reports.................. 78
7.8 Construction Information....................... 79
7.9 Construction, Permits, Licenses and Approvals.. 79
7.10 Purchase of Materials.......................... 79
7.11 Purchase of Offsite Materials.................. 79
7.12 Site Visits.................................... 79
7.13 Protection Against Lien Claims................. 79
7.14 Completion Certificates........................ 80
7.15 Completion Survey.............................. 80
Article 8 INFORMATION AND REPORTING REQUIREMENTS......... 81

8.1 Financial and Business Information............. 81
8.2 Compliance Certificates........................ 85
Article 9 CONDITIONS..................................... 86

9.1 Initial Advances, Etc.......................... 86
9.2 Advances During Construction Period............ 90
9.3 Any Advance.................................... 90
Article 10 EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF
DEFAULT........................................ 92

10.1 Events of Default.............................. 92
10.2 Remedies Upon Event of Default................. 95
Article 11 THE MANAGING AGENT............................. 99

11.1 Appointment and Authorization.................. 99
11.2 Managing Agent and Affiliates.................. 99
11.3 Proportionate Interest in any Collateral....... 99
11.4 Banks' Credit Decisions........................ 100
11.5 Action by Managing Agent....................... 100


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11.6 Liability of Managing Agent.................... 101
11.7 Indemnification................................ 102
11.8 Successor Managing Agent....................... 103
11.9 Foreclosure on Collateral...................... 104
11.10 No Obligations of Borrower..................... 104


Article 12 MISCELLANEOUS.................................. 105


12.1 Cumulative Remedies; No Waiver................. 105
12.2 Amendments; Consents........................... 105
12.3 Costs, Expenses and Taxes...................... 106
12.4 Nature of Banks' Obligations................... 107
12.5 Survival of Representations and Warranties..... 108
12.6 Notices........................................ 108
12.7 Execution of Loan Documents.................... 108
12.8 Binding Effect; Assignment..................... 109
12.9 Right of Setoff................................ 112
12.10 Sharing of Setoffs............................. 112
12.11 Indemnity by Borrower.......................... 113
12.12 Nonliability of the Banks...................... 114
12.13 No Third Parties Benefited..................... 115
12.14 Confidentiality................................ 115
12.15 Further Assurances............................. 116
12.16 Integration.................................... 116
12.17 Governing Law.................................. 116
12.18 Severability of Provisions..................... 116
12.19 Headings....................................... 117
12.20 Time of the Essence............................ 117
12.21 Foreign Banks and Participants................. 117
12.22 Hazardous Material Indemnity................... 118
12.23 Gaming Boards.................................. 119
12.24 Release of Certain Liens....................... 119
12.25 Other Lien Releases............................ 119
12.26 Termination; Release of Liens.................. 119
12.27 Removal of a Bank.............................. 120
12.28 Waiver of Right to Trial by Jury............... 120
12.29 Purported Oral Amendments...................... 121


Exhibits - --------


A - Architect's Certificate and Consent B - Collateral Assignment C - Commitment Assignment and Acceptance D - Completion Guaranty E - Compliance Certificate F - Contractor's Certificate and Consent G - Deed of Trust H - Engineer's Certificate and Consent I - Equipment Lease Letter J - Keep-Well Agreement K - Note L-1 - Opinion of Counsel L-2 Opinion of Counsel


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M - Pledge Agreement N - Pricing Certificate O - Qualified Member Subordinated Debt P - Request for Letter of Credit Q - Request for Loan R - Security Agreement S - Subsidiary Guaranty T - Trademark Collateral Assignment


Schedules - ---------


1.1 Bank Commitments 4.3 Governmental Approvals 4.4 Subsidiaries 4.7 Existing Liens, Negative Pledges and Rights of Others 4.8 Trademarks and Trade Names 4.10 Material Litigation 4.18 Environmental Matters 6.9 Existing Indebtedness 6.14 Existing Investments


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CONSTRUCTION/REVOLVING LOAN AGREEMENT
-------------------------------------


Dated as of September 15, 1995


This CONSTRUCTION/REVOLVING LOAN AGREEMENT ("Agreement") is entered into by and among New York-New York Hotel, LLC, a Nevada limited liability company ("Borrower"), each bank whose name is set forth on the signature pages of this Agreement and each lender which may hereafter become a party to this Agreement pursuant to Section 11.8 (collectively, the "Banks" and individually,
---- a "Bank"), Bank of Scotland and Societe Generale, as Lead Managers, First Interstate Bank of Nevada, as Co-Agent, and Bank of America National Trust and Savings Association, as Managing Agent.


In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:


DEFINITIONS AND ACCOUNTING TERMS
--------------------------------


1.1 Defined Terms. As used in this Agreement, the following terms
------------- shall have the meanings set forth below:


"Adjusted Annualized Borrower EBITDA" means, with respect to any
-----------------------------------
fiscal period, Annualized Borrower EBITDA for that fiscal period plus (a)
----
any Pre-Opening Expenses charged against the Net Income of Borrower during
that fiscal period plus (b) the Deemed EBITDA portion, if any, of any Cash
----
Equity Contributions made to Borrower during that fiscal period.


"Advance" means any advance made or to be made by any Bank to Borrower
-------
as provided in Article 2, and includes each Alternate Base Rate Advance and
--------- --------
Eurodollar Rate Advance.


"Affiliate" means, as to any Person, any other Person which directly
---------
or indirectly controls, or is under common control with, or is controlled
by, such Person. As used in this definition, "control" (and the
correlative terms, "controlled by" and "under common control with") shall
mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise); provided that, in any event, any Person that owns, directly or
--------
indirectly, 10% or more of the securities having ordinary voting power for
the election of directors


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or other governing body of a corporation that has more than 100 record
holders of such securities, or 10% or more of the partnership or other
ownership interests of any other Person that has more than 100 record
holders of such interests, will be presumed (subject to rebuttal by a
preponderance of the evidence) to control such corporation, partnership or
other Person.


"Aggregate Effective Amount" means, as of any date of determination
--------------------------
and with respect to all Letters of Credit then outstanding, the sum of (a)
---
the aggregate effective face amounts of all such Letters of Credit not then
paid by the Issuing Bank plus (b) the aggregate amounts paid by the Issuing
----
Bank under such Letters of Credit not then reimbursed to the Issuing Bank
by Borrower pursuant to Section 2.4(d) and not the subject of Advances made
------
pursuant to Section 2.4(e).
------


"Agreement" means this Construction/Revolving Loan Agreement, either
---------
as originally executed or as it may from time to time be supplemented,
modified, amended, restated or extended.


"Alternate Base Rate" means, as of any date of determination, the rate
-------------------
per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to
the higher of (a) the Reference Rate in effect on such date and (b) the
---------
Federal Funds Rate in effect on such date plus 1/2 of 1% (50 basis points).


"Alternate Base Rate Advance" means an Advance made hereunder and
---------------------------
specified to be an Alternate Base Rate Advance in accordance with Article
-------
2.
-
"Alternate Base Rate Loan" means a Loan made hereunder and specified
------------------------
to be an Alternate Base Rate Loan in accordance with Article 2.
---------


"Annualized Borrower EBITDA" means, as of the last day of each Fiscal
--------------------------
Quarter, Borrower EBITDA for the fiscal period consisting of that Fiscal
Quarter and the three immediately preceding Fiscal Quarters, adjusted, with
--------
respect to any such fiscal period in which the Project is open for business
for at least one (1) full Fiscal Quarter but less than four (4) full Fiscal
Quarters, by such amount as is necessary to reflect the annualization of
Borrower EBITDA using the following conventions: (i) if the Project has
been open for business for less than one (1) full Fiscal Quarter, no
annualization adjustment shall be made, (ii) if the Project has been open
for business for one (1) full Fiscal Quarter, Borrower EBITDA for that
Fiscal Quarter shall be multiplied by four, (iii) if the Project has been
open for business two (2)


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full Fiscal Quarters, Borrower EBITDA for those Fiscal Quarters shall be
multiplied by two and (iv) if the Project has been open for business for
three (3) full Fiscal Quarters, Borrower EBITDA for those Fiscal Quarters
shall be multiplied by four thirds (4/3).


"Annualized Guarantor EBITDA" means, as of the last day of each Fiscal
---------------------------
Quarter and with respect to a Guarantor, Guarantor EBITDA of that Guarantor
for the fiscal period consisting of that Fiscal Quarter and the three
immediately preceding Fiscal Quarters, adjusted (a) in the case of MGM
--------
Grand, Inc., if it or any of its Subsidiaries has a new hotel-casino
project which has then been open for business less than four (4) full
Fiscal Quarters, by an annualization adjustment with respect to the portion
of Guarantor EBITDA attributable thereto using the annualization
conventions set forth in the definition of "Annualized Borrower EBITDA" and
(b) in the case of Primadonna Resorts, Inc., if it or any of its
Subsidiaries has a new hotel-casino project which has then been open for
business less than four (4) full Fiscal Quarters, by an annualization
adjustment with respect to the portion of Guarantor EBITDA attributable
thereto using the annualization conventions set forth in the definition of
"Annualized EBITDA" contained in that certain Amended and Restated Reducing
Revolving Credit Agreement dated as of July 17, 1995 among Primadonna
Resorts, Inc., certain of its Subsidiaries, First Interstate Bank of
Nevada, N.A., as Agent, and the lenders party thereto, as the same is in
effect on the date of this Agreement.


"Applicable Alternate Base Rate Margin" means, for each Pricing
-------------------------------------
Period, the interest rate margin set forth below (expressed in basis points
per annum) opposite the Applicable Pricing Level for that Pricing Period:


Applicable
Pricing Level Margin
------------------ ------
I 0
II 25.00
III 50.00
IV 100.00


"Applicable Commitment Fee Rate" means, for each Pricing Period, the
------------------------------
rate set forth below (expressed in basis points per annum) opposite the
Applicable Pricing Level for that Pricing Period:


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Applicable
Pricing Level Commitment Fee
------------- --------------
I 31.25
II 37.50
III 37.50
IV 50.00


"Applicable Eurodollar Rate Margin" means, for each Pricing Period,
---------------------------------
the interest rate margin set forth below (expressed in basis points per
annum) opposite the Applicable Pricing Level for that Pricing Period:


Applicable
Pricing Level Margin
------------- ------
I 75.00
II 125.00
III 150.00
IV 200.00


"Applicable Pricing Level" means (a) for the Pricing Period from the
------------------------
Closing Date through November 15, 1995, Pricing Level III and (b) for each
Pricing Period thereafter, the pricing level set forth below opposite the
Guarantor Funded Debt Ratio as of the last day of the Fiscal Quarter most
recently ended prior to the commencement of that Pricing Period:


Guarantor Funded
Pricing Level Debt Ratio
------------- ----------------
I Less than 1.50 to 1.00


II Equal to or greater than
1.50 to 1.00
but less than 2.25 to 1.00


III Equal to or greater than
2.25 to 1.00
but less than 3.00 to 1.00


IV Equal to or greater than
3.00 to 1.00;


provided that in the event that Borrower does not deliver a Pricing
--------
Certificate pursuant to Section 8.1(d) with respect to any Pricing Period
------
prior to the commencement of such Pricing Period, then until (but only
until) such Pricing Certificate so is delivered the Applicable Pricing
Level for that Pricing Period sh ...