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evidenced by the Note [MGM Group Holdings’ debt
obligations of $1.05 billion], the amount outstanding
under such loans at the time of the contribution of the
Note to Newco, and the fact that * * * [Generale Bank]
and Group continuously recorded the Note as debt from
the date of creation through the date of contribution,
and (iv) provisions providing for the indemnification
by CLIS and * * * [Generale Bank] of Newco, the Initial
Members and their affiliates and agents against
breaches of any of the foregoing representations or
warranties.
At some point, White & Case took control of drafting the
letter agreement. Mr. Geary tried to produce something that
reflected his discussions with Mr. Jouannet. Mr. Geary
incorporated into the drafting process a side letter agreement
giving Generale Bank and CLIS the right to put their preferred
interests in Newco (later SMP) to Rockport Advisors (or its
affiliate). The put could be exercised “no earlier than December
31, 1996 and no later than December 31, 1997 upon two days
written notice from a Seller to Purchaser directing that the Put
be effected.” The side letter agreement proposed a $6 million
purchase price for the preferred interests and an advisory fee
consisting of $4 million plus an amount (not to exceed $2
million) equal to three-quarters of 1 percent of the tax losses,
if any, in excess of $1 billion that would have been allocated to
all members of Newco (other than Generale Bank, CLIS, Rockport
Advisors, CDR, or their affiliates) upon consummation of the
various transactions. The $6 million purchase price and the
advisory fee were to be deposited in a blocked account with a
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