05-58 Resolution No. 05-58
RESOLUTION
ACKNOWLEDGING AND APPROVING ASSIGNMENT OF CERTAIN
INTERESTS IN ELGIN RIVERBOAT RESORT
WHEREAS,the City of Elgin and Elgin Riverboat Resort("Elgin Riverboat")have entered
into that certain Amended and Restated Ground Lease Agreement dated December 2, 1998, but
effective for all purposes as of January 20, 1994 (the "Ground Lease");
WHEREAS,consistent with a resolution adopted by the City Council of the City of Elgin on
December 16, 1992, the City of Elgin has acknowledged and agreed, pursuant to Section 23 of the
Ground Lease,that Elgin Riverboat is a joint venture consisting of: (i)Nevada Landing Partnership,
an Illinois general partnership, which is a subsidiary of Mandalay Resort Group("Mandalay"), as a
50%joint venture partner;and(ii)RBG,L.P.,an Illinois limited partnership,which is an affiliate of
Hyatt Development Corporation, as the other 50%joint venture partner;
WHEREAS, by means of a merger transaction involving Mandalay and MGM MIRAGE
("MGM"),MGM will acquire Mandalay and,as a result,will become the indirect owner of Nevada
Landing and its 50%joint venture interest in Elgin Riverboat (the "JV Interest");
WHEREAS, MGM must receive certain approvals from the Illinois Gaming Board before
MGM may acquire indirectly the JV Interest;
WHEREAS,the Illinois Gaming Board currently does not have a sufficient number of acting
members to achieve a quorum and, consequently, is unable to take any action, including granting
MGM the necessary approvals to permit MGM to acquire indirectly the JV Interest;
WHEREAS,in order to allow the merger transaction between MGM and Mandalay to close
in a timely manner,Nevada Landing has agreed to place the JV Interest into escrow until such time
as MGM receives all necessary approvals from the Illinois Gaming Board;
WHEREAS, the JV Interest will be returned to Nevada Landing immediately after MGM
receives all necessary approvals from the Illinois Gaming Board;
WHEREAS, MGM has continuously apprised the Illinois Gaming Board staff of the
proposed escrow arrangement and the Illinois Gaming Board staff has reviewed the escrow
transaction documents;
WHEREAS, prior to the consummation of the merger transaction involving Mandalay and
MGM,MGM expects the Illinois Gaming Board staff to execute a letter acknowledging the proposed
escrow arrangement and stating, in effect, that the staff has no objection to the proposed escrow
arrangement; and
WHEREAS,the City Council has determined that it is in the best interest of the City of Elgin
to acknowledge and approve Nevada Landing's assignment of the JV Interest into escrow and,upon
MGM's receipt of all necessary approvals from the Illinois Gaming Board, the return of the JV
Interest to Nevada Landing.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
ELGIN, ILLINOIS, that the City of Elgin hereby approves and consents to Nevada Landing's
assignment of the JV Interest into escrow and,upon MGM's receipt of all necessary approvals from
the Illinois Gaming Board,the return of the JV Interest to Nevada Landing,and that the City of Elgin
hereby waives any and all rights and remedies available to the City of Elgin under Section 16 of the
Ground Lease with respect to such assignment by Nevada Landing.
s/ Ed Schock
Ed Schock, Mayor
Presented: February 23, 2005
Adopted: March 9, 2005
Vote: Yeas: 6 Nays: 0
Attest:
s/Dolonna Mecum
Dolonna Mecum, City Clerk