DESCRIPTION OF MORTGAGE NOTES

General

The Mortgage Notes were issued pursuant to the Mortgage Note Indenture among the Issuers, the Mortgage Note Guarantors and First Trust National Association, as trustee (the "Mortgage Note Trustee"), in a private transaction that was not subject to the registration requirements of the Securities Act. See "Notice to Investors." The Mortgage Notes are fully, unconditionally and jointly and severally guaranteed (i) on a senior, secured basis (the "Secured Mortgage Note Guaranties") by the Mall Construction Subsidiary and any future Restricted Subsidiary of the Issuers (the "Secured Mortgage Note Guarantors") and (ii) on a subordinated, unsecured basis (the "Subordinated Mortgage Note Guaranties" and, together with the Secured Mortgage Note Guaranties, the "Mortgage Note Guaranties") by Mall Intermediate Holdings and Phase II Intermediate Holdings (the "Subordinated Mortgage Note Guarantors" and, together with the Secured Mortgage Note Guarantors, the "Mortgage Note Guarantors"), with certain exceptions, pursuant to the terms of the Mortgage Note Indenture. The terms of the Mortgage Notes include those stated in the Mortgage Note Indenture, the Collateral Documents and those made part of the Mortgage Note Indenture by reference to the Trust Indenture Act of 1939 (the "Trust Indenture Act"). The Mortgage Notes are subject to all such terms, and holders of Mortgage Notes are referred to the Mortgage Note Indenture, the Collateral Documents and the Trust Indenture Act for a statement thereof. The following summary of the material provisions of the Mortgage Note Indenture and the Collateral Documents does not purport to be complete and is qualified in its entirety by reference to the Mortgage Note Indenture and the Collateral Documents, including the definitions therein of certain terms used below. A copy of the form of Mortgage Note Indenture and each of the Collateral Documents is available from the Company as described under "Additional Information." The definitions of certain terms used in the following summary are set forth below under "--Certain Definitions." Capitalized terms that are used but not otherwise defined in this Prospectus have the meanings assigned them in the Mortgage Note Indenture. A copy of the Mortgage Note Indenture has been filed with the Commission as an exhibit to the Registration Statement. For purposes of this "Description of Mortgage Notes," the term "Issuers" refers only to the Issuers and not to any of their respective Subsidiaries, the term the "Company" refers only to Las Vegas Sands, Inc. and not to any of its Subsidiaries, and the term "Venetian" refers only to Venetian Casino Resort, LLC and not to any of its Subsidiaries.

Ranking and Security

The Mortgage Notes constitute joint and several obligations of the Issuers and rank senior in right of payment to all Subordinated Indebtedness of the Issuers. The Secured Mortgage Note Guaranties rank senior in right of payment to all Subordinated Indebtedness of the Secured Mortgage Guarantors. The Subordinated Mortgage Note Guaranties rank senior or pari passu in right of payment to all subordinated indebtedness of the Subordinated Mortgage Note Guarantors and rank subordinate in right of payment to all Senior Debt of the Subordinated Mortgage Note Guarantors. As of the date hereof, (i) the only outstanding Subordinated Indebtedness are the Senior Subordinated Notes; (ii) Venetian, Mall Manager and Phase II Manager are the only direct Subsidiaries of the Company and Mall Intermediate Holdings, Phase II Intermediate Holdings, Mall Construction Subsidiary, Mall Holdings, Phase II Holdings, Mall Subsidiary and Phase II Subsidiary are the only direct or indirect Subsidiaries of Venetian; and (iii) Mall Intermediate Holdings, Phase II Intermediate Holdings and Mall Construction Subsidiary are Restricted Subsidiaries of the Issuers and Phase II Manager, Phase II Holdings and Phase II Subsidiary are Unrestricted Subsidiaries of the Issuers. The Board of Directors of the Company has designated each of Mall Manager, Mall Holdings and Mall Subsidiary as a Special Subsidiary.

To the extent permitted by applicable law and subject to any required approval of any Governmental Instrumentality, the Mortgage Notes are secured by a Lien on the Note Collateral owned by the Issuers and the Secured Mortgage Note Guaranties are secured by the Note Collateral owned by the Secured Mortgage Note Guarantors, in each case whether such Note Collateral is now owned or hereafter acquired. Such Lien is prior to all other Liens on the Note Collateral, except for Permitted Liens, which includes the Lien on the Project Assets securing the Bank Credit Facility and the Lien on the Mall Collateral securing the Mall Construction Loan Facility and the Bank Credit Facility. Except for the Lien in favor of the Mortgage Notes on the Mortgage Notes Proceeds Account, the Liens securing the Bank Credit Facility

and the Mall Construction Loan Facility are each prior to the Liens securing the Mortgage Notes and the Secured Mortgage Note Guaranties. Mall Construction Lender has a first priority Lien on the Mall Collateral, the lenders under the Bank Credit Facility have a first priority Lien on the Project Assets and a second priority Lien on the Mall Collateral and the holders of the Mortgage Notes have a second priority Lien on the Project Assets and a third priority Lien on the Mall Collateral. Upon Completion and the satisfaction of certain other conditions, the Mall Collateral will be released from the Lien securing the Bank Credit Facility and the Mortgage Notes and transferred to the Mall Subsidiary in connection with the release of the Issuers and the Mall Construction Subsidiary from further obligations under the Mall Construction Loan Facility. Upon the creation of the Phase II Land as a separate parcel and the satisfaction of certain other conditions, the Phase II Land may be transferred to the Phase II Subsidiary and, upon such transfer, the Phase II Land will be released from the Liens securing the Bank Credit Facility and the Mortgage Notes.

The Note Collateral includes substantially all of the assets comprising the Project, except as described below. In addition to the Note Collateral, the Mortgage Notes are secured by a first priority pledge of the Mortgage Notes Proceeds Account. The Note Collateral does not include: (i) the assets of the Phase II Subsidiary and, after the release thereof, the Mall Collateral; (ii) certain equipment owned by the HVAC Provider relating to the Project; (iii) the Specified FF&E; (iv) any assets which if pledged, hypothecated or given as collateral security would require the Issuers to seek approval of the Nevada Gaming Authorities of the pledge, hypothecation or collateralization, or require the Mortgage Note Trustee or a holder or beneficial holder of the Mortgage Notes to be licensed, qualified or found suitable by an applicable Gaming Authority (other than any approval required for the pledge, hypothecation or collateralization of assets in connection with the Exchange Offer); (v) a pledge of the capital stock of the Company or Venetian or any of the Issuers' Subsidiaries; and (vi) certain assets to the extent such assets are permitted to be financed by Indebtedness permitted to be incurred pursuant to the covenant entitled "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" and such Indebtedness is permitted to be secured pursuant to the covenant entitled "Liens" pursuant to clause (b), (c),
(i) or (o) of the definition of "Permitted Liens."

The right of the Mortgage Note Trustee to realize upon and sell the Note Collateral is likely to be significantly impaired by applicable bankruptcy and insolvency laws if a proceeding under such laws were commenced in respect of the Issuers or any Mortgage Note Guarantor. Such laws may impose limitations or prohibitions on the exercise of rights and remedies under the Collateral Documents for a substantial or indefinite period of time. During the pendency of any foreclosure proceeding, the Mortgage Note Trustee could seek the appointment of a receiver through a petition to the appropriate Nevada state court for the taking of possession of the Note Collateral. The receiver may be required to obtain the approval of Nevada Gaming Authorities to continue gaming operations until the foreclosure sale. If the Mortgage Note Trustee acquired the Note Collateral in a foreclosure sale, it may contract for the operation of the Note Collateral by an independent operator who would be required to comply with the licensing requirements and other restrictions imposed by the Nevada Gaming Authorities, pursuant to an arrangement under which the Holders of the Mortgage Notes would not share in the profits or losses of gaming operations. In addition, if the Mortgage Note Trustee acquires and operates the Note Collateral, the Mortgage Note Trustee and the Holders of the Mortgage Notes will, if they share in the profits and losses, and may, in any event, be required to comply with the licensing requirements under the Nevada gaming laws. In any foreclosure sale, licensing requirements under the Nevada Gaming Control Act may limit the number of potential bidders and may delay the sale of the Note Collateral, either of which could adversely affect the sale price of the Note Collateral. See "Risk Factors--Ability to Realize on Collateral and Exercise Remedies" and "--Certain Bankruptcy Considerations."

Principal, Maturity and Interest

The Mortgage Notes are joint and several secured obligations of the Issuers, limited in aggregate principal amount to $425.0 million and will mature on November 15, 2004. The Mortgage Notes bear interest at the rate of 12 1/4% per annum of the principal amount then outstanding from the Issuance Date to the date of payment of such principal amount. Installments of interest become due and payable semi-annually in arrears on May 15 and November 15 of each year, commencing May 15, 1998, to the holders of record at the close of business on the preceding May 1 or November 1. Additionally, installments of

accrued and unpaid interest will become due and payable with respect to any principal amount of the Mortgage Notes that matures (whether at stated maturity, upon acceleration, upon maturity of repurchase obligation or otherwise) upon such maturity of such principal amount of the Mortgage Notes. Interest on the Mortgage Notes is computed on the basis of a 360-day year, consisting of twelve 30-day months. Each installment of interest is calculated to accrue from and including the most recent date to which interest has been paid or provided for (or from and including the Issuance Date if no installment of interest has been paid) to, but not including, the date of payment.

Principal of, premium and Liquidated Damages, if any and interest on the Mortgage Notes are payable at the office or agency of the Issuers maintained for such purpose within the City and State of New York or, at the option of the Issuers, payment of interest and Liquidated Damages, if any, may be made by check mailed to the holders of the Mortgage Notes at their respective addresses set forth in the register of holders of Mortgage Notes; provided that all payments of principal, premium and Liquidated Damages, if any and interest on the Mortgage Notes the holders of which have given wire transfer instructions to the Issuers are required to be made by wire transfer of immediately available funds to the accounts specified by the holders thereof. Until otherwise designated by the Issuers, their office or agency in New York is the office of the Mortgage Note Trustee maintained for such purpose. The Mortgage Notes are issued in registered form, without coupons, and in denominations of $1,000 and integral multiples thereof.

Mandatory Redemption

The Issuers are not required to make mandatory redemptions or sinking fund payments prior to maturity with respect to the Mortgage Notes.

Optional Redemption

Except as described below, the Mortgage Notes are not redeemable at the option of the Issuers prior to November 15, 2001. On or after November 15, 2001, the Mortgage Notes will be redeemable at the option of the Issuers, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the applicable redemption date, if redeemed during the twelve-month period beginning on November 15 of the years indicated below:

                                    Percentage
                                   of Principal
Year                                  Amount
----                                  ------
  2001 ..........................     106.125%
  2002 ..........................     103.063%
  2003 and thereafter ...........     100.000%

Notwithstanding the foregoing, on or prior to November 15, 2000, the Issuers may on any one or more occasions redeem up to 35% of the aggregate principal amount of Mortgage Notes originally issued at a redemption price of 112.25% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon, to the redemption date, with the proceeds of or the savings recognized from one or more Redemption Triggering Events; provided that at least 65% of the aggregate principal amount of Mortgage Notes originally issued remain outstanding immediately after the occurrence of such redemption; and provided, further, that (i) such redemption shall occur within 60 days of the date of such Redemption Triggering Event and (ii) Mortgage Notes held by the Issuers and not cancelled will not be deemed to be outstanding for purposes of calculating the aggregate principal amount of Mortgage Notes outstanding after the occurrence of such redemption.

In addition, at any time prior to November 15, 2001, the Issuers may, at their option, redeem the Mortgage Notes, in whole or in part, at a redemption price equal to 100% of the principal amount thereof plus the applicable Mortgage Note Make-Whole Premium, plus, to the extent not included in the Mortgage Note Make-Whole Premium, accrued and unpaid interest and Liquidated Damages, if any, to the date of redemption. For purposes of the foregoing, "Mortgage Note Make-Whole Premium" means, with respect to a Mortgage Note, an amount equal to the greater of (i) 12.25% of the outstanding principal amount of such Mortgage Note and (ii) the excess of (a) the present value of the remaining interest, premium and principal payments due on such Mortgage Note as if such Mortgage Note were redeemed on

November 15, 2001, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the outstanding principal amount of such Mortgage Note.

Notwithstanding any other provision hereof, if any Gaming Authority requires that a holder or beneficial owner of the Mortgage Notes must be licensed, qualified or found suitable under any applicable gaming laws in order to maintain any gaming license or franchise of the Company or any Restricted Subsidiary under any applicable gaming laws, and the holder or beneficial owner fails to apply for a license, qualification or finding of suitability within 30 days after being requested to do so by the Gaming Authority (or such lesser period that may be required by such Gaming Authority) or if such holder or beneficial owner is not so licensed, qualified or found suitable, the Issuers shall have the right, at their option, (i) to require such holder or beneficial owner to dispose of such holder's or beneficial owner's Mortgage Notes within 30 days of receipt of such finding by the applicable Gaming Authority (or such earlier date as may be required by the applicable Gaming Authority) or (ii) to call for redemption of the Mortgage Notes of such holder or beneficial owner at a redemption price equal to the lesser of the principal amount thereof or the price at which such holder or beneficial owner acquired the Mortgage Notes, together with, in either case, accrued and unpaid interest and Liquidated Damages, if any, to the earlier of the date of redemption or, the date of the finding of unsuitability by such Gaming Authority, which may be less than 30 days following the notice of redemption if so ordered by such Gaming Authority. In connection with any such redemption, and except as may be required by a Gaming Authority, the Issuers shall comply with the procedures contained in the Mortgage Notes for redemptions of the Mortgage Notes. Under the Mortgage Note Indenture, the Issuers are not required to pay or reimburse any holder of the Mortgage Notes or beneficial owner who is required to apply for such license, qualification or finding of suitability for the costs of the licensure or investigation for such qualification or finding of suitability. Such expenses will, therefore, be the obligation of such holder or beneficial owner. See "Regulation and Licensing."

Repurchase at the Option of Holders

Change of Control

Upon the occurrence of a Change of Control, the Issuers will make an offer to purchase all or any part (equal to $1,000 or an integral multiple thereof) of the Mortgage Notes pursuant to the offer described below (the "Change of Control Offer") at a price in cash (the "Change of Control Payment") equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase. Within 30 days following any Change of Control, the Issuers will mail a notice to each holder stating the following: (1) a Change of Control is being made pursuant to the covenant entitled "Change of Control," and all Mortgage Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment;
(2) the purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed, except as may be otherwise required by applicable law (the "Change of Control Payment Date");
(3) any Mortgage Note not properly tendered will remain outstanding and continue to accrue interest; (4) unless the Issuers default in the payment of the Change of Control Payment, all Mortgage Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control Payment Date; (5) holders electing to have any Mortgage Notes purchased pursuant to a Change of Control Offer will be required to surrender the Mortgage Notes, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Mortgage Notes completed, to the paying agent (which may be the Company or Venetian) specified in the notice at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date; (6) holders will be entitled to withdraw their tendered Mortgage Notes and their election to require the Issuers to purchase the Mortgage Notes, provided, that the paying agent receives, not later than the close of business on the last day of the Offer Period (as defined in the Mortgage Note Indenture), a telegram, telex, facsimile transmission or letter setting forth the name of the holder, the principal amount of Mortgage Notes tendered for purchase, and a statement that such holder is withdrawing his tendered Mortgage Notes and his election to have such Mortgage Notes purchased; and (7) that holders whose Mortgage Notes are being purchased only in part will be issued new Mortgage Notes equal in principal amount to the unpurchased portion of the Mortgage Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof.

The Issuers will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Mortgage Notes pursuant to a Change of Control Offer.

On the Change of Control Payment Date, the Issuers will, to the extent permitted by law, (1) accept for payment all Mortgage Notes or portions thereof properly tendered pursuant to the Change of Control Offer, (2) deposit with the paying agent an amount equal to the aggregate Change of Control Payment in respect of all Mortgage Notes or portions thereof so tendered and (3) deliver, or cause to be delivered, to the Mortgage Note Trustee for cancellation the Mortgage Notes so accepted together with an Officers' Certificate stating that such Mortgage Notes or portions thereof have been tendered to and purchased by the Issuers. The paying agent will promptly mail to each holder of Mortgage Notes the Change of Control Payment for such Mortgage Notes, and the Mortgage Note Trustee will promptly authenticate and mail to each holder a new Mortgage Note equal in principal amount to any unpurchased portion of the Mortgage Notes surrendered, if any, provided, that each such new Mortgage Note will be in a principal amount of $1,000 or an integral multiple thereof. The Issuers will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

The existence of a holder's right to require the Issuers to repurchase such holder's Mortgage Notes upon the occurrence of a Change of Control may deter a third party from seeking to acquire either of the Issuers in a transaction that would constitute a Change of Control.

The source of funds for any repurchase of Mortgage Notes upon a Change of Control will be cash generated from operations or other sources, including borrowings, sales of assets or sales of Capital Stock. However, there can be no assurance that sufficient funds will be available at the time of any Change of Control to make any required repurchases. Any failure by the Issuers to repurchase Mortgage Notes tendered pursuant to a Change of Control Offer will be deemed an Event of Default.

The Bank Credit Facility and the Mall Construction Loan Facility contain, and future agreements relating to any senior debt of the Issuers may contain, restrictions or prohibitions on the Issuers' ability to repurchase the Mortgage Notes. In the event that a Change of Control occurs at a time when the Issuers are prohibited from repurchasing the Mortgage Notes, the Issuers could seek the consent of their lenders to purchase the Mortgage Notes or could attempt to refinance the borrowings that contain such prohibition or restriction. If the Issuers do not obtain such consent or refinance such Indebtedness, they will remain prohibited or restricted from repurchasing the Mortgage Notes. In such case, the Issuers' failure to repurchase the Mortgage Notes tendered in the Change of Control Offer would constitute an Event of Default under the Mortgage Note Indenture which would in turn constitute an event of default under the agreements governing the Issuers of the senior debt. See "Description of Other Indebtedness."

The definition of Change of Control includes a phrase relating to the sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the assets of the Issuers and their Subsidiaries, taken as a whole. Although there is a developing body of case law interpreting the phrase "substantially all," there is no precisely established definition of the phrase under applicable law. Accordingly, the ability of a holder of Mortgage Notes to require the Issuers to repurchase such Mortgage Notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of the Issuers and their Subsidiaries taken as a whole to another Person or group may be uncertain.

Asset Sales

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to consummate an Asset Sale, unless (w) no Default or Event of Default exists or is continuing immediately prior to or after giving effect to such Asset Sale, (x) the Issuers or their Restricted Subsidiaries, as the case may be, receive consideration at the time of such Asset Sale at least equal to the fair market value (as determined by the Board of Directors and set forth in an Officers' Certificate delivered to the Mortgage Note Trustee) of the assets sold or otherwise disposed of and (y) at least 85% of the consideration therefor received by either of the Issuers or any Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided, however, that the amount of (A) any liabilities (as shown on such Issuer's or such Restricted Subsidiary's, as the case may be, most

recent balance sheet or in the notes thereto) of the Issuers or any Restricted Subsidiary, as the case may be (other than liabilities that are by their terms expressly subordinated to the Mortgage Notes or any Mortgage Note Guaranty, which may be assumed only if such liabilities are deemed to be Restricted Payments in the case of the Issuer or any Restricted Subsidiary), that are assumed by the transferee of any such assets and (B) any notes, securities or other obligations received by the Issuers or any Restricted Subsidiary, as the case may be, from such transferee that are converted by the Issuers or such Restricted Subsidiary, as the case may be, into cash (to the extent of the cash received) within 20 Business Days following the closing of such Asset Sale, shall be deemed to be cash only for purposes of satisfying clause (y) of this paragraph and for no other purpose.

Within 180 days after any Issuer's or any Restricted Subsidiary's receipt of the Net Proceeds of any Asset Sale, such Issuer or such Restricted Subsidiary may apply the Net Proceeds from such Asset Sale (i) to permanently reduce Indebtedness under the Bank Credit Facility or other Indebtedness that is not Subordinated Indebtedness, (ii) in an investment in any one or more business, capital expenditure or other tangible asset of the Issuers or any Restricted Subsidiary, in each case, engaged, used or useful in the Principal Business, or (iii) for working capital purposes in an aggregate amount not to exceed $20.0 million, in each case, with no concurrent obligation to make an offer to purchase any Mortgage Notes. Pending the final application of any such Net Proceeds, such Issuer or such Restricted Subsidiary may temporarily reduce Indebtedness under the Bank Credit Facility or another revolving credit facility, if any, or otherwise invest such Net Proceeds in Cash Equivalents which shall be pledged to the Mortgage Note Trustee or an agent thereof (including an agent under the Bank Credit Facility) as security for the holders of Mortgage Notes with the same relative priority with respect to the other secured creditors as the priority of the Liens securing the asset that is the subject of the Asset Sale, except (i) such Cash Equivalents shall be pledged to the Disbursement Agent as security for the Lenders prior to Completion and (ii) such Cash Equivalents need not be pledged to the Mortgage Note Trustee or an agent thereof (including an agent under the Bank Credit Facility) to the extent that the assets subject to such Asset Sale were not subject to Liens securing the Note Collateral prior to such Asset Sale. Any Net Proceeds from the Asset Sale that are not invested or used to repay Indebtedness or as working capital within 180 days of receipt as provided in the first sentence of this paragraph will be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Issuers shall, subject to any repayment obligations owed to the lenders under the Bank Credit Facility and the Mall Construction Lender, make an offer to all holders of Mortgage Notes (an "Asset Sale Offer") to purchase the maximum principal amount of Mortgage Notes, that is an integral multiple of $1,000, that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 101% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Mortgage Note Indenture. The Issuers will commence an Asset Sale Offer with respect to Excess Proceeds within 30 days after the date that Excess Proceeds exceeds $10.0 million by mailing the notice required pursuant to the terms of the Mortgage Note Indenture. To the extent that the aggregate amount of Mortgage Notes tendered pursuant to an Asset Sale Offer is less than the applicable Excess Proceeds, the Issuers may use any remaining Excess Proceeds for general corporate purposes or to offer to redeem Senior Subordinated Notes pursuant to the provisions of the Senior Subordinated Note Indenture described below under the caption "Description of Senior Subordinated Notes --Repurchase at the Option of the Holders--Asset Sales." If the aggregate principal amount of Mortgage Notes surrendered by holders thereof exceeds the amount of Excess Proceeds, the Mortgage Note Trustee shall select the Mortgage Notes to be purchased in the manner described under the caption "Selection and Notice" below. Upon completion of any such Asset Sale Offer, the amount of Excess Proceeds shall be deemed reset at zero. The Mortgage Note Indenture also requires the Issuers or such Restricted Subsidiary to grant (i) to the lenders under the Bank Credit Facility a first priority lien and (ii) to the Mortgage Note Trustee, on behalf of the holders of the Mortgage Notes, a second priority lien, in each case, on any properties or assets acquired with the Net Proceeds of any such Asset Sale to the extent that the assets subject to such Asset Sale were subject to Liens securing the Note Collateral prior to such Asset Sale. To the extent that any assets subject to an Asset Sale were subject to Liens securing the Mall Collateral prior to such Asset Sale, the Mortgage Note Indenture also requires the Issuers or such Restricted Subsidiary to grant (i) to the Mall Construction Lender a first priority lien, (ii) to the lenders under the Bank Credit Facility a second priority lien and (iii) to the Mortgage Note Trustee, on behalf of the holders

of the Mortgage Notes, a third priority lien, in each case, on any property or assets acquired with the Net Proceeds of any such Asset Sale.

Event of Loss

The Mortgage Note Indenture provides that upon the occurrence of any Event of Loss with respect to Note Collateral with a fair market value (or replacement cost, if greater) in excess of $1.5 million, the Issuers or the affected Restricted Subsidiary, as the case may be, may apply the Net Loss Proceeds from such Event of Loss to (X) the rebuilding, repair, replacement or construction of improvements to the Project, with no concurrent obligation to make any purchase of any Mortgage Notes; provided that (A) if such Event of Loss occurs prior to Completion, the Issuers ability to apply such Net Loss Proceeds to rebuild, repair, replace or construct improvements to the Project will be subject to the terms of the Disbursement Agreement and (B) if such Event of Loss occurs on or after Completion, the Issuers deliver to the Mortgage Note Trustee within 90 days of such Event of Loss (i) a written opinion from a reputable architect or an Independent Expert (as defined in the Cooperation Agreement) that the Project can be rebuilt, repaired, replaced, or constructed and Completed within one year of delivery of such opinion substantially in the condition prior to such Event of Loss and (ii) an Officers' Certificate certifying that the Issuers have available from Net Loss Proceeds, cash on hand or available borrowings under Indebtedness permitted to be incurred pursuant to the covenant described below under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" to complete such rebuilding, repair, replacement or construction, (Y) permanently reduce Indebtedness or commitments under the Bank Credit Facility or other Indebtedness that is not Subordinated Indebtedness or (Z) for working capital purposes in an aggregate amount not to exceed $20.0 million, in each case, with no concurrent obligation to make an offer to purchase Mortgage Notes. Pending the final application of any such Net Loss Proceeds, the Issuer or the applicable Restricted Subsidiary, as the case may be, may temporarily reduce Indebtedness under the Bank Credit Facility or another revolving credit facility, if any, or otherwise invest such Net Loss Proceeds in Cash Equivalents which shall be pledged to the Mortgage Note Trustee or an agent thereof (including the agent under the Bank Credit Facility) as security for the holders of Mortgage Notes with the same relative priority with respect to the other secured creditors as the priority of the Liens securing the asset that is the subject of the Event of Loss, except (i) such Cash Equivalents shall be pledged to the Disbursement Agent as security for the lenders prior to Completion and (ii) such Cash Equivalents need not be pledged to the Mortgage Note Trustee or an agent thereof (including the agent under the Bank Credit Facility) to the extent that the assets subject to such Event of Loss were not subject to Liens securing the Note Collateral prior to such Event of Loss. Any Net Loss Proceeds from an Event of Loss that are not reinvested or used to repay Indebtedness or as working capital as provided in the first sentence of this paragraph will be deemed to constitute Excess Loss Proceeds. When the aggregate amount of "Excess Loss Proceeds" exceeds $10.0 million, the Issuers shall, subject to any repayment obligations owed to the lenders under the Bank Credit Facility and Mall Construction Lender, make an offer to all holders of Mortgage Notes (an "Event of Loss Offer") to purchase the maximum principal amount of Mortgage Notes, that is an integral multiple of $1,000, that may be purchased out of the Excess Loss Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Mortgage Note Indenture. The Issuers will commence an Event of Loss Offer with respect to Excess Loss Proceeds within 30 days after the date that Event of Loss Proceeds exceeds $10.0 million by mailing the notice required pursuant to the terms of the Mortgage Note Indenture. To the extent that the aggregate amount of Mortgage Notes tendered pursuant to an Event of Loss Offer is less than the applicable Excess Loss Proceeds, the Issuers may use any remaining Excess Loss Proceeds for general corporate purposes or to offer to redeem Senior Subordinated Notes pursuant to the provisions of the Senior Subordinated Note Indenture described below under the caption "Description of Senior Subordinated Notes--Repurchase at the Option of the Holders--Asset Sales." If the aggregate principal amount of Mortgage Notes surrendered by holders thereof exceeds the amount of Excess Loss Proceeds, the Mortgage Note Trustee shall select the Mortgage Notes to be purchased in the manner described under the caption "Selection and Notice" below. Upon completion of any such Event of Loss Offer, the amount of Excess Loss Proceeds shall be reset at zero. The Mortgage Note Indenture also requires the Issuers or such Restricted Subsidiary to grant (i) to the lenders under the Bank Credit Facility a first priority lien and (ii) to the Mortgage Note Trustee, on behalf of the holders of the

Mortgage Notes, a second priority Lien, in each case, on any properties or assets rebuilt, repaired or constructed with such Net Loss Proceeds to, the extent that the assets subject to the Event of Loss were subject to Liens securing the Note Collateral prior to such Event of Loss. If the Event of Loss occurred prior to Completion, then to the extent that any assets subject to an Event of Loss were subject to liens securing the Mall Collateral prior to such Event of Loss, the Mortgage Note Indenture also requires the Issuers or the applicable Restricted Subsidiary to grant (i) to the Mall Construction Lender a first priority lien, (ii) to the lenders under the Bank Credit Facility a second priority lien and (iii) to the Mortgage Note Trustee, on behalf of the holders of the Mortgage Notes, a third priority Lien, in each case on any property or assets rebuilt, repaired or constructed with the Net Loss Proceeds of any such Event of Loss.

Selection and Notice

If less than all of the Mortgage Notes are to be purchased in an Asset Sale Offer or Event of Loss Offer or redeemed at any time, selection of Mortgage Notes for purchase or redemption will be made by the Mortgage Note Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Mortgage Notes are listed, or, if the Mortgage Notes are not so listed, on a pro rata basis, by lot or by such other method as the Mortgage Note Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements); provided, that no Mortgage Notes of $1,000 or less shall be purchased or redeemed in part.

Notices of purchase or redemption shall be mailed by first class mail, postage prepaid, at least 30 but not more than 60 days before the purchase or redemption date to each holder of Mortgage Notes to be purchased or redeemed at such holder's registered address. Notices of redemption may not be conditional. If any Mortgage Note is to be purchased or redeemed in part only, any notice of purchase or redemption that relates to such Mortgage Note shall state the portion of the principal amount thereof that has been or is to be purchased or redeemed.

A new Mortgage Note in principal amount equal to the unpurchased or unredeemed portion of any Mortgage Note purchased or redeemed in part will be issued in the name of the holder thereof upon cancellation of the original Mortgage Note. Mortgage Notes called for redemption become due on the date fixed for redemption. On and after the purchase or redemption date (unless the Issuers default in payment of the purchase or redemption price), interest and Liquidated Damages, if any, shall cease to accrue on Mortgage Notes or portions thereof purchased or called for redemption.

Certain Covenants

Gaming Licenses

The Mortgage Note Indenture provides that the Issuers will use their best efforts to obtain and retain in full force and effect at all times all Gaming Licenses necessary for the operation of the Project.

Restricted Payments

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make any distribution on account of either of the Issuers' or any of their Restricted Subsidiaries' Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving either of the Issuers) or to the direct or indirect holders of either of the Issuers' Equity Interests in their capacity as such (other than (1) dividends or distributions by the Issuers payable in Equity Interests (other than Disqualified Stock) of the Issuers (or accretions thereon); or (2) dividends or distributions paid to the Issuers or a Wholly Owned Restricted Subsidiary of the Issuers); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving either of the Issuers) any Equity Interests of the Issuers or any of its Restricted Subsidiaries, or any other Affiliate of the Issuers (other than any such Equity Interests owned by the Issuers or any Wholly Owned Restricted Subsidiary of the Issuers); (iii) make any payment on or with respect to or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Indebtedness of the Issuers or any of their Restricted Subsidiaries (other than, in each case, scheduled interest and principal payments with respect to any such Subordinated Indebtedness);
(iv) make any payment in respect of repayment or reimbursement of amounts advanced under any obligation under the Completion Guaranty; or (v) make any Restricted Investment (all such payments and other actions set forth in clauses
(i) through (v) above being collectively referred to as "Restricted Payments"), unless, at the time of such Restricted Payment:

(a) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(b) the Issuers would, after giving pro forma effect to such Restricted Payment as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the first paragraph of the description of the covenant described under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock"; and

(c) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Issuers and their Restricted Subsidiaries after the Issuance Date (excluding Restricted Payments permitted by clauses
(ii), (iii), (v), (vi), (vii), (viii), (ix) (but only to the extent necessary under clause (ix) to pay the fees and expenses of any lenders or agents under the Tranche A Take-out Commitment), (x), (xiii), (xiv), (xv) and (xvii) of the next succeeding paragraph and including the other Restricted Payments permitted by the next paragraph), is less than the sum of (X) 50% of (1) the Consolidated Net Income of the Company for the period (taken as one accounting period) from the first day after the Project is Completed to the end of the Company's most recently ended fiscal quarter for which internal financial statements are available (or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit) less (2) the amount paid or to be paid in respect of such period pursuant to clause (v) of the next following paragraph to shareholders or members other than the Issuers, plus (Y) without duplication, 100% of the aggregate net cash proceeds received by the Issuers since the Issuance Date from capital contributions or the issue or sale of Equity Interests (other than Disqualified Stock) or debt securities of the Issuers that have been converted into or exchanged for such Equity Interests of the Issuers (other than Equity Interests or such debt securities of the Issuers sold to a Restricted Subsidiary of the Issuers and other than Disqualified Stock or debt securities that have been converted into or exchanged for Disqualified Stock), plus (Z) to the extent not otherwise included in the Company's Consolidated Net Income, 100% of the cash dividends or distributions or the amount of the cash principal and interest payments received since the Issuance Date by the Issuers or any Restricted Subsidiary from any Unrestricted Subsidiary or Special Subsidiary or in respect of any Restricted Investment (other than dividends or distributions to pay obligations of or with respect to such Unrestricted Subsidiary or Special Subsidiary such as income taxes) until the entire amount of the Investment in such Unrestricted Subsidiary or Special Subsidiary has been received or the entire amount of such Restricted Investment has been returned, as the case may be, and 50% of such amounts thereafter. In the event that the Issuers convert an Unrestricted Subsidiary or Special Subsidiary to a Restricted Subsidiary, the Issuers may add back to this clause
(c) the aggregate amount of any Investment in such Subsidiary that was a Restricted Payment at the time of such Investment.

The foregoing provisions do not prohibit (i) the payment of any dividend within 60 days after the date of declaration thereof, if at the date of declaration such payment would have complied with the provisions of the Mortgage Note Indenture; (ii) (a) an Investment in Phase II Subsidiary, Phase II Manager, Phase II Holdings or any Special Subsidiary or (b) the redemption, repurchase, retirement or other acquisition of any Equity Interests of the Issuers or any Restricted Subsidiary, in each case, in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to a Restricted Subsidiary of the Issuers) of Equity Interests of the Issuers (other than any Disqualified Stock); provided that the amount of any net cash proceeds from the sale of such Equity Interests shall be excluded from clause (c)(Y) of the preceding paragraph; (iii) the defeasance, redemption, repurchase, retirement or other acquisition of any Subordinated Indebtedness of the Issuers or any Restricted Subsidiary in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to a Restricted Subsidiary of the Issuers) of Subordinated Indebtedness (other than any Subordinated Indebtedness issued in respect of the Completion Guaranty) of the Issuers or such Restricted Subsidiary or Equity Interests of the Issuers (other than Disqualified Stock); provided, however, that (1) the principal amount of such Subordinated Indebtedness incurred pursuant to this clause (iii) shall not exceed the principal amount of the Subordinated Indebtedness so redeemed, repurchased, retired or otherwise acquired (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (2) such Subordinated Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Subordinated Indebtedness being redeemed, repurchased,

retired or otherwise acquired, (3) such Subordinated Indebtedness is subordinate in right of payment to the Mortgage Notes and any Mortgage Note Guaranty on terms at least as favorable to the holders of the Mortgage Notes or the Mortgage Note Guaranties as those contained in the documentation governing the Subordinated Indebtedness being redeemed, repurchased, retired or otherwise acquired and (4) the net cash proceeds from the sale of any Equity Interests issued pursuant to this clause (iii) shall be excluded from clause (c)(Y) of the preceding paragraph; (iv) any redemption or purchase by the Issuers or any Restricted Subsidiary of Equity Interests or Subordinated Indebtedness of either of the Issuers required by a Gaming Authority in order to preserve a material Gaming License; provided, that so long as such efforts do not jeopardize any material Gaming License, the Issuers or such Restricted Subsidiary shall have diligently tried to find a third-party purchaser for such Equity Interests or Subordinated Indebtedness and no third-party purchaser acceptable to the applicable Gaming Authority was willing to purchase such Equity Interests or Subordinated Indebtedness within a time period acceptable to such Gaming Authority; (v) (a) for so long as the Company is a corporation under Subchapter S of the Code or a substantially similarly treated pass-through entity or Venetian is a limited liability company that is treated as a partnership or a substantially similarly treated pass-through entity, in each case, for Federal income tax purposes (as evidenced by an opinion of counsel at least annually), the Issuers may each make cash distributions to their shareholders or members, during each Quarterly Payment Period, in an aggregate amount not to exceed the Permitted Quarterly Tax Distribution in respect of the related Estimation Period, and if any portion of the Permitted Quarterly Tax Distribution is not distributed during such Quarterly Payment Period, the Permitted Quarterly Tax Distribution payable during the immediately following four quarter period shall be increased by such undistributed portion and (b) distributions by non-Wholly Owned Subsidiaries of either of the Issuers or any Restricted Subsidiary of the Issuers but only to the extent required to pay any tax liability of such non-Wholly Owned Subsidiary; (vi) the transfer of the Mall Collateral to the Mall Subsidiary in accordance with the Sale and Contribution Agreement and the Disbursement Agreement and the transfer of 1% managing members interests in Mall Subsidiary and Mall Holdings to Mall Manager; (vii) the transfer of the Phase II Land to the Phase II Subsidiary and the transfer of 1% managing members interests in Phase II Subsidiary and Phase II Holdings to Phase II Manager; (viii) Investments by the Issuers in Supplier Joint Ventures in an amount not to exceed $10.0 million in the aggregate; (ix) Investments in any Special Subsidiary in an amount not to exceed $2.0 million in the aggregate (plus amounts necessary to fund the fees and expenses of the lenders or agents under the Tranche A Take-out Commitment), excluding for purposes of this clause (ix) the value of any Restricted Payments under clauses
(ii), (vii) or (xiv); (x) intercompany payments, including without limitation, debt repayments, between or among the Issuers and their Wholly Owned Restricted Subsidiaries; (xi) the repurchase of shares of, or options to purchase, common stock of either of the Issuers from employees, former employees, directors or former directors of either of the Issuers (or permitted transferees of such individuals), pursuant to the terms of the agreements (including employment agreements) or plans (or amendments thereto), in each case, as in effect on the date of the Mortgage Note Indenture and as approved by the board of directors of the Company under which such individuals purchase or sell, or are granted the option to purchase or sell, shares of such common stock (the "Employee Stock Buybacks"); (xii) following an initial Public Equity Offering, dividends or common stock buybacks in an aggregate amount in any calendar year not to exceed 6% of the aggregate Net Proceeds received by either of the Issuers in connection with such initial Public Equity Offering and any subsequent Public Equity Offering; (xiii) repurchases of Capital Stock of either of the Issuers deemed to occur upon exercise of stock options if such Capital Stock represents a portion of the exercise price of such options; (xiv) cash contributions to a Special Subsidiary which are funded through a contribution (that does not constitute Disqualified Stock) by the Sole Stockholder or any of his Affiliates to either of the Issuers and any related Investment in any Special Subsidiary by either of the Issuers or any Restricted Subsidiary; provided that the amount of such contributions shall be excluded from clause (c)(Y) of the proceeding paragraph; (xv) contributions of cash, real property or other property to the Phase II Subsidiary, Phase II Holdings or Phase II Manager by the Sole Stockholder or any of his Affiliates through a contribution (that does not constitute Disqualified Stock) to either of the Issuers and any related Investment in the Phase II Subsidiary, Phase II Holdings or Phase II Manager by either of the Issuers or any Restricted Subsidiary; provided that the amount of such contributions shall be excluded from clause (c)(Y) of the proceeding paragraph; (xvi) the payment of any Change of Control Payment (as defined in the Senior Subordinated Note Indenture) and/or the

application of the Excess Proceeds (as defined in the Senior Subordinated Note Indenture) from any Asset Sale Offer (as defined in the Senior Subordinated Note Indenture), in each case, to redeem or repurchase Senior Subordinated Notes in accordance with provisions of the Senior Subordinated Note Indenture described below under the caption "Description of Senior Subordinated Notes --Repurchase at the Option of the Holders"; (xvii) on the Final Completion Date (as defined in the Disbursement Agreement), payments on the Completion Guaranty Loan from amounts which are returned to the Mall Construction Subsidiary from funds in the Mall Retainage/Punchlist Account (as defined in the Disbursement Agreement) in accordance with the Mall Escrow Agreement (as defined in the Disbursement Agreement); provided that such payments shall not be greater than all amounts previously deposited into the Mall Retainage/ Punchlist Account from the Guaranty Deposit Account (as defined in the Disbursement Agreement);
(xviii) the repayment of all or a portion of the Completion Guaranty Loan with Available Funds to the extent permitted by the terms of the Disbursement Agreement and the Completion Guaranty or, after Completion, with funds received by the Company as a result of judgments or settlements of claims under the Project Documents (including insurance policies and the Construction Management Contract); and (xix) the repayment of the Substitute Tranche B Loan with the proceeds of the Permitted Construction Loan Refinancing or the assumption of the Substitute Tranche B Loan by the Mall Subsidiary; provided, that at the time of, and after giving effect to, any Restricted Payment permitted under clauses (ii) (b) (to the extent that any Equity Interests are redeemed, retired or acquired from the cash proceeds from the sale or issuance of Equity Interests), (iii) (to the extent that any Subordinated Indebtedness is defeased, redeemed, retired, repurchased or otherwise acquired from the cash proceeds from the sale or issuance of other Subordinated Indebtedness or Equity Interests), (viii), (ix), (xii), and (xviii), no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.

For purposes of determining the amount of Restricted Investments outstanding at any time, all Restricted Investments will be valued at their fair market value at the time made (as determined in good faith by the Company's Board of Directors), and no adjustments will be made for subsequent changes in fair market value.

Special Subsidiary Restricted Payments

The Mortgage Note Indenture provides that a Special Subsidiary will not and will not permit any of its Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make any distribution on account of its Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving such Special Subsidiary or its Subsidiaries) (other than (1) dividends or distributions paid or made pro rata to all holders of Equity Interests of such Special Subsidiary or its Subsidiaries; (2) dividends or distributions by such Special Subsidiary payable in Equity Interests (other than Disqualified Stock) of such Special Subsidiary (or accretions thereon); or (3) dividends or distributions paid to such Special Subsidiary or a Wholly Owned Subsidiary of such Special Subsidiary by a Subsidiary of such Special Subsidiary); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving any Special Subsidiary or its Subsidiaries) any Equity Interests of any Special Subsidiary or any Subsidiary of any Special Subsidiary; or (iii) make any Special Subsidiary Restricted Investment (all such payments and other actions set forth in clauses (i) through (iii) above being collectively referred to as "Special Subsidiary Restricted Payments").

The foregoing provisions do not prohibit (i) the redemption, repurchase, retirement or other acquisition of any Equity Interests of any Special Subsidiary in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to the Issuers or any Restricted Subsidiary of the Issuers) of Equity Interests of such Special Subsidiary and
(ii) the payment to or declaration or payment of any distribution or dividend to the Issuers and any of their Restricted Subsidiaries or the redemption, repurchase, retirement or other acquisition of any Equity Interests of any Special Subsidiary held by the Issuers or any Wholly Owned Restricted Subsidiary.

For purposes of determining the amount of Special Subsidiary Restricted Investments outstanding at any time, all Special Subsidiary Restricted Investments are valued at their fair market value at the time made (as determined in good faith by the Company's Board of Directors), and no adjustments are made for subsequent changes in fair market value.

In addition, after the transfer of the Mall Collateral to the Mall Subsidiary, the assets comprising the Mall Collateral may not be sold, leased or transferred to an Affiliate of the Issuers other than an Issuer, any

Restricted Subsidiary or any Special Subsidiary that is a Subsidiary of Mall Intermediate Holdings and in which the Sole Stockholder does not own any Equity Interests directly or indirectly, except through the Issuers.

Designation of Unrestricted Subsidiary

The Mortgage Note Indenture provides that the Board of Directors of the Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided, that: (i) at the time of designation, the Investment by either of the Issuers and any of their Restricted Subsidiaries in such Subsidiary (other than Permitted Investments) shall be deemed a Restricted Investment (to the extent not previously included as a Restricted Investment) made on the date of such designation in the amount of the fair market value of such Investment as determined in good faith by the Board of Directors and, in the case of Investments in excess of $5.0 million, supported by a fairness opinion issued by an accounting, appraisal or investment banking firm of national standing; (ii) since the Issuance Date, such Unrestricted Subsidiary has not acquired any assets from either of the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Mortgage Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales";
(iii) at the time of designation, no Default or Event of Default has occurred and is continuing or results immediately after such designation or as a result of any Restricted Investment made in such Subsidiary at the time of such designation; (iv) at the time of designation, such Subsidiary has no Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (v) such Subsidiary does not own any Equity Interests in a Restricted Subsidiary; and
(vi) such Subsidiary does not own or operate or possess any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or any material portion of the Project Assets of the Project.

A Subsidiary ceases to be an Unrestricted Subsidiary and becomes a Restricted Subsidiary if either (i) at any time while it is a Subsidiary of the Company (1) such Subsidiary acquires any assets from the Company or any Restricted Subsidiary other than as permitted by the provisions of the Mortgage Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales";
(2) such Subsidiary has any Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (3) such Subsidiary owns any Equity Interests in a Restricted Subsidiary of the Company; or (4) such Subsidiary owns or operates or possesses any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or
(ii) the Board of Directors of the Company designates such Unrestricted Subsidiary to be a Restricted Subsidiary and no Default or Event of Default occurs or is continuing immediately after such designation.

As of the date hereof, each of Phase II Subsidiary, Phase II Manager and Phase II Holdings is designated an Unrestricted Subsidiary. Any future designation by the Board of Directors of the Company shall be evidenced to the Mortgage Note Trustee by filing with the Mortgage Note Trustee a certified copy of the resolutions of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions.

As of the date hereof, the Issuers have no Unrestricted Subsidiaries other than Phase II Subsidiary, Phase II Holdings and Phase II Manager. Under certain circumstances, as described above, the Company is able to designate future Subsidiaries as Unrestricted Subsidiaries. Unrestricted Subsidiaries are not subject to any of the restrictive covenants set forth in the Mortgage Note Indenture and will not be Mortgage Note Guarantors.

In addition, after the transfer of the Phase II Land to the Phase II Subsidiary, the Phase II Land may not be sold, leased or transferred to an Affiliate of the Issuers other than an Issuer, any Restricted Subsidiary or any Unrestricted Subsidiary that is a Subsidiary of Phase II Intermediate Holdings and in which the Sole Stockholder does not own any Equity Interests, directly or indirectly.

Designation of Special Subsidiary

The Mortgage Note Indenture provides that the Board of Directors of the Company may designate any Restricted Subsidiary to be a Special Subsidiary; provided, that: (i) at the time of designation, the Investment by either of the Issuers and any of their Restricted Subsidiaries in such Subsidiary (other than Permitted Investments) shall be deemed a Restricted Investment (to the extent not previously included

as a Restricted Investment) made on the date of such designation in the amount of the fair market value of such Investment as determined in good faith by the Board of Directors of the Company and, in the case of Investments in excess of $5.0 million, supported by a fairness opinion issued by an accounting, appraisal or investment banking firm of national standing; (ii) since the Issuance Date, such Special Subsidiary has not acquired any assets from the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Mortgage Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales"; (iii) at the time of designation, no Default or Event of Default has occurred and is continuing or results immediately after such designation or as a result of any Restricted Investment made in such Subsidiary at the time of such designation; (iv) at the time of designation, such Subsidiary has no Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (v) such Subsidiary does not own any Equity Interests in a Restricted Subsidiary; and (vi) such Subsidiary does not own or operate or possess any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or any material portion of the Project Assets of the Project.

A Subsidiary shall cease to be a Special Subsidiary and shall become a Restricted Subsidiary if either (i) at any time while it is a Subsidiary of the Issuers (1) such Subsidiary acquires any assets from the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Mortgage Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales";
(2) such Subsidiary has any Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (3) such Subsidiary owns any Equity Interests in a Restricted Subsidiary of the Issuers; or (4) such Subsidiary owns or operates or possesses any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or
(ii) the Issuers designate such Special Subsidiary to be a Restricted Subsidiary and no Default or Event of Default occurs or is continuing immediately after such designation.

Any such designation by the Board of Directors shall be evidenced to the Mortgage Note Trustee by filing with the Mortgage Note Trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions.

As of the Issuance Date, Mall Subsidiary, Mall Holdings and Mall Manager were each a Special Subsidiary. Under certain circumstances, as described above, the Company is able to designate certain Subsidiaries as Special Subsidiaries. Special Subsidiaries are not subject to all of the restrictive covenants set forth in the Mortgage Note Indenture and will not be Mortgage Note Guarantors.

Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable with respect to (collectively, "incur" and correlatively, an "incurrence" of) any Indebtedness (including Acquired Indebtedness) or any shares of Disqualified Stock; provided, however, that the Issuers and their Restricted Subsidiaries may incur Indebtedness or issue shares of Disqualified Stock if (i) the Project is Completed and (ii) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of such incurrence would have been at least 2.0 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock had been issued, as the case may be, and application of proceeds had occurred at the beginning of such four-quarter period.

The foregoing limitations do not apply to:

(a) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness under the Bank Credit Facility in an aggregate principal amount not to exceed at any one time $170.0 million, less (i) the aggregate amount of all principal repayments and mandatory prepayments (other than repayments made under a revolving loan facility prior to maturity or in connection with a refinancing permitted under the Mortgage Note Indenture) actually made from time to time after the date of the Mortgage Note Indenture with respect to such Indebtedness, and (ii) permanent reductions resulting from the application of Asset Sale or Event of Loss proceeds;

(b) the incurrence by the Issuers or any of their Restricted Subsidiaries of any Existing Indebtedness;

(c) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness represented by the Mortgage Notes, the Mortgage Note Guaranties, the Senior Subordinated Notes, the Senior Subordinated Note Guaranties and obligations arising under the Collateral Documents to the extent that such obligations would constitute Indebtedness;

(d) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness (the "Refinancing Indebtedness") issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, substitute or refund Indebtedness referred to in the first paragraph of this covenant or in clauses (b), (c), this clause (d), (g), (h), (j) or (l); provided, however, that (1) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of Indebtedness (or, in the case of Indebtedness with original issue discount, the accreted value of such Indebtedness) so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (2) if the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded is subordinate in right of payment to the Mortgage Notes, such Refinancing Indebtedness shall be subordinate in right and priority of payment to the Mortgage Notes and any Mortgage Note Guaranty on terms at least as favorable to the holders of Mortgage Notes and the Mortgage Note Guaranties as those contained in the documentation governing any subordinated Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded, and (3) the Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded;

(e) intercompany Indebtedness between or among the Issuers, any Mortgage Note Guarantor and any Wholly Owned Restricted Subsidiary of the Issuers; provided, however, the obligations to pay principal, interest or other amounts under such intercompany Indebtedness is subordinated to the payment in full of the Mortgage Notes and any Mortgage Note Guaranties;

(f) Hedging Obligations that are incurred (1) for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of the Mortgage Note Indenture to be outstanding or
(2) for the purpose of fixing or hedging currency exchange rate risk with respect to any currency exchanges;

(g) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness (which may include Capital Lease Obligations or purchase money obligations), incurred for the purpose of financing all or any part of the purchase or lease of personal property or equipment, including the Specified FF&E, used in the business of the Issuers or such Restricted Subsidiary, in an aggregate principal amount pursuant to this clause (g) (including any refinancings thereof pursuant to clause (d) above) not to exceed $100.0 million (plus accrued interest thereon and the amount of reasonable expenses incurred and premium paid in connection with any refinancing pursuant to clause (d) above) outstanding at any time;

(h) the incurrence by the Issuers or any of their Restricted Subsidiaries of Non-Recourse Financing used to finance the purchase or lease of personal or real property used in the business of the Issuers or such Restricted Subsidiary; provided, that (i) such Non-Recourse Financing represents at least 75% of the purchase price of such personal or real property; (ii) the Indebtedness incurred pursuant to this clause (h) (including any refinancings thereof pursuant to clause (d) above) shall not exceed $50.0 million (plus the amount of reasonable expenses incurred and premium paid in connection with any refinancing pursuant to clause (d) above) outstanding at any time; and (iii) no such Indebtedness may be incurred pursuant to this clause (h) unless the Project is Completed and the Company shall have generated at least $10.0 million of Consolidated Cash Flow in one fiscal quarter;

(i) to the extent that such incurrence does not result in the incurrence by the Issuers or any of their Restricted Subsidiaries of any obligation for the payment of borrowed money of others, Indebtedness incurred solely in respect of performance bonds, completion guarantees, standby letters of credit or bankers' acceptances; provided, that such Indebtedness was incurred in the ordinary course of business of the Issuers or any of their Restricted Subsidiaries and in an aggregate principal amount outstanding under this clause
(i) at any one time of less than $20.0 million;

(j) the incurrence by the Issuers or any of their Restricted Subsidiaries of Subordinated Indebtedness to the Sole Stockholder pursuant to an advance under the Completion Guaranty in an aggregate amount not to exceed $25.0 million plus accrued interest thereon; provided that such Subordinated Indebtedness has a Weighted Average Life to Maturity greater than the Senior Subordinated Notes and is by its terms subordinated to the Mortgage Notes and the Senior Subordinated Notes;

(k) the incurrence by the Issuers of up to $140.0 million of Indebtedness represented by the Mall Construction Loan Facility;

(l) the incurrence by the Issuers of Indebtedness represented by the Substitute Tranche B Loan plus accrued interest thereon; provided that such Indebtedness has a Weighted Average Life to Maturity greater than the Senior Subordinated Notes and is by its terms subordinated to the Mortgage Notes;

(m) the incurrence by the Issuers of unsecured Indebtedness (subordinated in right of payment to the Senior Subordinated Notes) issued in connection with the Employee Stock Buybacks permitted under clause (xi) of the covenant described above under the caption "--Restricted Payments";

(n) the incurrence by the Issuers or any Restricted Subsidiary of (A)(i) at any time prior to Completion, additional Indebtedness under clause (a) or
(k) in an aggregate amount not to exceed $20.0 million, plus (ii) after a default under the Disbursement Agreement and at any time prior to Completion, additional Indebtedness under clause (a) or (k) in an aggregate amount not to exceed $30.0 million (provided that Indebtedness incurred pursuant to this clause (n)(A)(ii) is matched, dollar for dollar, by additional equity investments by the Sole Stockholder or an Affiliate of the Sole Stockholder), in the case of each of clause (A)(i) and (A)(ii), incurred in accordance with the Intercreditor Agreement and (B) after Completion, additional Indebtedness in an aggregate amount at any time outstanding not to exceed $25.0 million (less any amounts incurred pursuant to clause (n)(A) above that remain outstanding after Completion);

(o) after Completion, the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness under any Working Capital Facility in an aggregate amount at any time outstanding not to exceed $20.0 million;

(p) the incurrence by the Issuers of Indebtedness incurred for the purpose of financing all or any part of the purchase or lease of gaming equipment to be used in connection with the casino located at the casino resort to be owned by Phase II Subsidiary or any casino operated pursuant to an Other Phase II Agreement in an aggregate amount at any time outstanding not to exceed $10.0 million; provided, that upon default under such Indebtedness, the lender under such Indebtedness may seek recourse or payment against the Issuers only through the return or sale of the property or equipment so purchased or leased and may not otherwise assert a valid claim for payment on such Indebtedness against the Issuers or any other property of the Issuers; and

(q) the guaranty by the Issuers or any Restricted Subsidiary of Indebtedness of the Issuers or a Restricted Subsidiary that was permitted to be incurred by another provision of this covenant.

The Mortgage Note Indenture provides that the Issuers will not permit any of their Unrestricted Subsidiaries or Special Subsidiaries to incur any Indebtedness (including Acquired Indebtedness) or issue any shares of Disqualified Stock, other than Non-Recourse Indebtedness; provided, however, that if any such Unrestricted Subsidiary or Special Subsidiary ceases to remain an Unrestricted Subsidiary or Special Subsidiary, such event shall be deemed to constitute the incurrence of the Indebtedness in such Subsidiary by a Restricted Subsidiary. For a discussion of the Issuers' ability to incur additional Indebtedness, see "Description of Intercreditor Agreement."

For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness permitted in clauses (a) through (q) above or is entitled to be incurred pursuant to the first paragraph of this covenant, the Issuers shall, in their sole discretion, classify such item of Indebtedness in any manner that complies with this covenant and such item of Indebtedness will be treated as having been incurred pursuant to only such clause or clauses or pursuant to the first paragraph hereof. Accrual of interest, the accretion of accreted value or principal and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this covenant.

Upon any refinancing or replacement of the Bank Credit Facility with a lender that does not become party to the Intercreditor Agreement, the Mortgage Note Trustee shall enter into an intercreditor agreement with such lender with terms that are no less favorable to the Mortgage Note Trustee or the Holders of Mortgage Notes than those contained in the Intercreditor Agreement.

Liens

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly create, incur, assume or suffer to exist any Lien on any asset owned as of the Issuance Date or thereafter acquired by the Issuers or any such Restricted Subsidiary, or any income or profits therefrom, or assign or convey any right to receive income therefrom, except, in each case, Permitted Liens.

Merger, Consolidation, or Sale of Assets

The Mortgage Note Indenture provides that neither of the Issuers shall consolidate or merge with or into or wind up into (whether or not such entity is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person unless (i) the Company or Venetian, as the case may be, is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than the Company or Venetian) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof; (ii) the Person formed by or surviving any such consolidation or merger (if other than the Company or Venetian) or the Person to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made assumes all the obligations of the Company or Venetian, as the case may be, under the Mortgage Note Indenture and the Collateral Documents pursuant to a supplemental indenture or other documents or instruments in form reasonably satisfactory to the Mortgage Note Trustee under the Mortgage Notes and the Mortgage Note Indenture; (iii) immediately after such transaction no Default or Event of Default exists; (iv) such transaction will not result in the loss or suspension or material impairment of any material Gaming License; (v) the Company, Venetian or any Person formed by or surviving any such consolidation or merger, or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made (A) will have Consolidated Net Worth (immediately after the transaction but prior to any purchase accounting adjustments resulting from the transaction) equal to or greater than the Consolidated Net Worth of the Company or Venetian immediately preceding the transaction and (B) will, at the time of such transaction and after giving pro forma effect thereto as if such transaction had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock"; and (vi) such transactions would not require any holder of Mortgage Notes (other than any Person acquiring the Company or Venetian or their assets and any Affiliate thereof) to obtain a gaming license or be qualified under the law of any applicable gaming jurisdiction; provided that such holder would not have been required to obtain a gaming license or be qualified under the laws of any applicable gaming jurisdiction in the absence of such transactions. Notwithstanding anything to the contrary, the Issuers may consolidate or merge with or wind up into each other without meeting the requirements set forth in clause (v) above.

Transactions with Affiliates

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries or Special Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into any contract, agreement, understanding, loan, advance or guaranty with, or for the benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless
(a) such Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary or Special Subsidiary with an unrelated Person and
(b) the Company delivers to the Mortgage Note Trustee (i) with respect to any Affiliate Transaction involving aggregate payments in excess of (A) $500,000, an Officers' Certificate

certifying that such Affiliate Transaction complies with clause (a) above, or (B) $1.0 million, a resolution adopted by a majority of the disinterested non-employee directors of the Board of Directors approving such Affiliate Transaction and set forth in an Officers' Certificate certifying that such Affiliate Transaction complies with clause (a) above and (ii) with respect to any Affiliate Transaction that is a loan transaction involving a principal amount in excess of $10.0 million or any other type of Affiliate Transaction involving aggregate payments in excess of $10.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary or Special Subsidiary from a financial point of view issued by an Independent Financial Advisor. The foregoing provisions do not apply to the following: (f) rental payments from Mall Subsidiary to Venetian under the Billboard Lease, as in effect on the date of the Mortgage Note Indenture; (g) the lease agreement relating to a restaurant to be operated by Wolfgang Puck and currently contemplated to be known as "Oba Chine" restaurant on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained with an unrelated Person; (h) the Services Agreement, as in effect on the date of the Mortgage Note Indenture; (i) the Other Phase II Agreements on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained with an unrelated Person; (j) purchases of materials or services from a Joint Venture Supplier by the Issuers or any of their Restricted Subsidiaries or Special Subsidiaries in the ordinary course of business on arm's length terms; (k) any employment, indemnification, noncompetition or confidentiality agreement entered into by either of the Issuers or any of their Restricted Subsidiaries or Special Subsidiaries with their employees or directors in the ordinary course of business (other than an employment agreement with the Sole Stockholder); (l) loans or advances to employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries (i) to fund the exercise price of options granted under employment agreements or the Issuers' stock option plans or agreements in each case, as in effect on the date of the Mortgage Note Indenture or (ii) for any other purpose not to exceed $2.0 million in the aggregate outstanding at any one time under this clause (ii); (m) the payment of reasonable fees to directors of the Issuers and their Restricted Subsidiaries and Special Subsidiaries who are not employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries; (n) the grant of stock options or similar rights to employees and directors of either of the Issuers pursuant to agreements or plans approved by the Board of Directors of the Company or the managing member of Venetian and any repurchases of stock options of the Issuers from such employees to the extent provided for in such plans or agreements or permitted under the covenant described above under the caption "--Restricted Payments"; (o) transactions between or among the Issuers and/or any of their Restricted Subsidiaries or transactions between or among the Special Subsidiaries and/or any Wholly-Owned Subsidiary of Special Subsidiaries; (p) with respect to the Issuers and any Restricted Subsidiary, Restricted Payments permitted by the provisions of the Mortgage Note Indenture described above under the caption "Restricted Payments" and with respect to any Special Subsidiary, Special Subsidiary Restricted Payments permitted by the provisions of the Mortgage Note Indenture described above under the caption "Special Subsidiary Restricted Payments"; (q) purchases of Equity Interests of the Issuers (other than Disqualified Stock) by any stockholder or member of the Issuers (or an Affiliate of a stockholder or member of the Issuers); (r) the Completion Guaranty and related Completion Guaranty Loan; (s) the transactions contemplated by the Cooperation Agreement, the Mall Lease, the Sale and Contribution Agreement and the HVAC Services Agreement, in each case, as in effect on the date of the Mortgage Note Indenture; (t) the use of the Congress Center by the owner of the Expo Center; provided that Venetian receives fair market value for the use of such property, as determined in the reasonable discretion of the Board of Directors of the Company; (u) the transactions contemplated in "Certain Transactions--Temporary Lease," "--Retirement Plan" and "--Airplane Expenses"; (v) transactions relating to the Permitted Construction Loan Refinancing, including the Tranche B Take-out Commitment and the guaranty by the Sole Stockholder of the loan to be made under the Tranche A Take-out Commitment; (w) transactions relating to the guaranty of Tranche B Loan of the Mall Construction Loan Facility by the Sole Stockholder, including the making of the Substitute Tranche B Loan; (x) the transfer of the Phase II Parcel to the Phase II Subsidiary and, upon Completion and in accordance with the Sale and Construction Agreement, the transfer of the Mall Collateral to the Mall Subsidiary; and (y) the Company or Venetian may enter into and perform their obligations under a gaming operations lease or management agreement with Phase II Subsidiary relating to the casino to be operated in the casino resort owned by the Phase II Subsidiary on terms substantially similar to those of the Casino Lease except that

(a) the rent payable to the Phase II Subsidiary under such lease shall be equal to all revenue derived from such casino minus the sum of (1) the operating costs related to such casino (including an allocated portion (based on gaming revenue) of the Company's or Venetian's, as the case may be, administrative costs related to its gaming operations) and (2) the lesser of $250,000 or 1.0% of such casino's operating income (or zero if there is an operating loss)
(determined in accordance with generally accepted accounting principles), (b) the Company or Venetian, as the case may be, may agree that they shall operate the casino in the resort owned by the Phase II Subsidiary and the Casino in the Project in substantially similar manners and (c) the Company or Venetian, as the case may be, may agree to have common gaming and surveillance operations in such casinos (based on equal allocations of revenues and operating costs).

Dividend and Other Payment Restrictions Affecting Subsidiaries

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual restriction on the ability of any such Restricted Subsidiary (other than Venetian) to (a) (i) pay dividends or make any other distributions to the Issuers or any of their Restricted Subsidiaries (A) on their Capital Stock or (B) with respect to any other interest or participation in, or measured by, its profits, or (ii) pay any Indebtedness owed to the Issuers or any of their Restricted Subsidiaries (other than in respect of the subordination of such Indebtedness to the Mortgage Notes, the Mortgage Note Guarantees or any other Indebtedness incurred pursuant to the terms of the Mortgage Note Indenture, as the case may be), (b) make loans or advances to the Issuers or any of their Restricted Subsidiaries or (c) sell, lease, or transfer any of its properties or assets to the Issuers or any of their Restricted Subsidiaries, except (in each case) for such encumbrances or restrictions existing under or by reason of (1) contractual encumbrances or restrictions in effect on the Issuance Date, (2) the Bank Credit Facility (and any related security agreements), the Mortgage Note Indenture, the Mortgage Notes, the Mall Construction Loan Facility (and any related security agreements), any Mortgage Note Guarantees, indebtedness incurred pursuant to clause (g), (h), (j), (l),
(n) or (o) of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" and the Collateral Documents, (3) the Senior Subordinated Note Indenture, the Senior Subordinated Notes and the Senior Subordinated Note Guarantees, (4) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any Restricted Subsidiary as in effect at the time of such acquisition (except to the extent such Indebtedness was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that the Consolidated Cash Flow of such Person is not taken into account in determining whether such acquisition was permitted by the terms of the Mortgage Note Indenture, (5) by reason of customary non-assignment provisions in leases entered into in the ordinary course of business and consistent with past practices and any leases permitted by the provisions of the covenant entitled "Restrictions on Leasing and Dedication of Property," (6) purchase money obligations for property acquired in the ordinary course of business that impose restrictions of the nature discussed in clause (c) above on the property so acquired, (6) applicable law or any applicable rule or order of any Gaming Authority, (7) Permitted Liens, (8) customary restrictions imposed by asset sale or stock purchase agreements relating to the sale of assets or stock by the Issuers or any Restricted Subsidiary, or (9) any encumbrances or restrictions imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (8) above, provided, that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Company's Board of Directors, no more restrictive with respect to such dividend and other payment restrictions than those contained in the dividend or other payment restrictions prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

Line of Business

The Mortgage Note Indenture provides that for so long as any Mortgage Notes are outstanding, the Issuers shall not, and shall not permit any of their Restricted Subsidiaries or Special Subsidiaries to, engage in any business or activity other than, (i) with respect to the Issuers and their Restricted

Subsidiaries, the Principal Business, and (ii) with respect to any Special Subsidiary, the Special Subsidiary Principal Business, except, in each case, to such extent as would not be material to (a) the Issuers and their Subsidiaries taken as a whole or (b) the Special Subsidiary, respectively.

Restrictions on Leasing and Dedication of Property

The Mortgage Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, lease, sublease, or grant a license, concession or other agreement to occupy, manage or use any real or personal Project Assets owned or leased by the Issuers or any Restricted Subsidiary (each, a "Lease Transaction"), other than the following Lease Transactions:

(a) the Issuers or any Restricted Subsidiary may enter into a Lease Transaction with respect to any space on or within the Project with any Person (other than an Unrestricted Subsidiary), provided that, in the reasonable opinion of the Issuers, (i) such Lease Transaction will not materially interfere with, impair or detract from the operations of any of the Project Assets, and will in the reasonable judgment of the Issuers enhance the value and operations of the Project and (ii) such Lease Transaction is at a fair market rent (in light of other similar or comparable prevailing commercial transactions) and contains such other terms such that the Lease Transaction, taken as a whole, is commercially reasonable and fair to the Issuers or such Restricted Subsidiary in light of prevailing or comparable transactions in other casinos, hotels, attractions or shopping venues comparable to the Project;

(b) the Issuers or any Restricted Subsidiary may enter into a Lease Transaction with any Unrestricted Subsidiary or Special Subsidiary with respect to (i) the Mall Space and (ii) the Phase II Land;

(c) the Issuers may enter into Lease Transactions with any Wholly Owned Restricted Subsidiary of the Issuers, including the lease of the Casino by the Company from Venetian and the Billboard Lease;

(d) the Issuers or any Restricted Subsidiary may enter into a management or operating agreement with respect to any Project Asset, including any hotel (other than any Project Asset or space used for any casino or gaming operations) with any Person (other than an Unrestricted Subsidiary); provided that (i) the manager or operator has experience in managing or operating similar operations and (ii) such management or operating agreement is on commercially reasonable and fair terms to the Issuers or such Restricted Subsidiary (in either case, in the reasonable judgment of the Issuers);

(e) the Issuers may dedicate space for the purpose of constructing (i) a mass transit system, (ii) a pedestrian bridge over or pedestrian tunnel under Las Vegas Boulevard and Sands Avenue or similar structures to facilitate pedestrian or traffic flow, and (iii) a right turn lane or other roadway dedication at or near the Project; provided that, in each case, such dedication does not materially impair the use or operations of the Project;

(f) the Mall Management Agreement and any Lease Transaction where the interest created is a Permitted Lien;

(g) to the extent permitted under the covenant described above under the caption "--Affiliate Transactions," any use or lease agreement between Interface and Venetian relating to the Congress Center; and

(h) Venetian may enter into the HVAC Services Agreement.

Notwithstanding the foregoing, the Mortgage Note Indenture provides that the Issuers shall not be permitted to enter into any Lease Transaction: (1) except in the case of clause (h), if at the time of such proposed Lease Transaction, a Default or Event of Default has occurred and is continuing or would occur immediately after entering into such Lease Transaction (or immediately after any extension or renewal of such Lease Transaction made at the option of the Issuers or any Restricted Subsidiary); (2) no gaming or casino operations may be conducted on any Project Asset that is the subject of such Lease Transaction other than by the Issuers, a Restricted Subsidiary or pursuant to any Other Phase II Agreements; and (3) no Lease Transaction may provide that the Issuers or any Restricted Subsidiary may subordinate its fee or leasehold interest to any lessee or any party providing financing to any lessee.

The Mortgage Note Trustee shall at the request of the Issuers or any Restricted Subsidiary enter into a commercially customary leasehold non-disturbance and attornment agreement with the lessee under

any Lease Transaction permitted under the covenant described above. Such agreement, among other things, shall provide that if the interests of the Issuers (or in the case of a Lease Transaction being entered by a Restricted Subsidiary, the interests of the Restricted Subsidiary) in the Project Assets subject to the Lease Transaction are acquired by the Mortgage Note Trustee (on behalf of the holders of the Mortgage Notes), whether by purchase and sale, foreclosure, or deed in lieu of foreclosure or in any other way, or by a successor to the Mortgage Note Trustee, including without limitation a purchaser at a foreclosure sale, then (A) the interests of the lessee in the Project Assets subject to the Lease Transaction shall continue in full force and effect and shall not be terminated or disturbed, except in accordance with the lease documentation applicable to the Lease Transaction, and (B) the lessee in the Lease Transaction shall attorn to and be bound to the Mortgage Note Trustee (on behalf of the Holders), its successors and assigns under all terms, covenants and conditions of the lease documentation applicable to the Lease Transaction. Such agreement shall also contain such other provisions that are commercially customary and that will not materially and adversely affect the Lien granted by any of the Mortgage Note Indenture Fee Deed of Trust, the Mortgage Note Indenture Leasehold Deed of Trust or the Mortgage Note Indenture Mall Parcel Fee Deed of Trust, in each case as certified to the Mortgage Note Trustee by an Officer of the Company.

Insurance

The Mortgage Note Indenture provides that the Issuers will, and will cause their Restricted Subsidiaries to, maintain the specified levels of insurance set forth in the Cooperation Agreement (whether or not the Cooperation Agreement is then in force). Additionally, the Issuers will not amend, waive or modify the provisions applicable to such insurance in the Cooperation Agreement. See "Insurance Requirements."

Limitation on Status as Investment Company

The Mortgage Note Indenture prohibits the Issuers and their Restricted Subsidiaries from being required to register as an "investment company" (as that term is defined in the Investment Company Act of 1940, as amended).

Ownership of Unrestricted Subsidiaries and Special Subsidiaries

The Mortgage Note Indenture provides that, at all times from the Issuance Date until all of the Capital Stock of the Phase II Subsidiary or the Mall Subsidiary is sold or otherwise disposed of to any Person other than an Affiliate of the Issuers, one of the Issuers will directly or indirectly own
(i) at least a majority of the issued and outstanding Capital Stock of Phase II Subsidiary (which is an Unrestricted Subsidiary) and (ii) at least 80% of the issued and outstanding Capital Stock of Mall Subsidiary (which is a Special Subsidiary); provided that the Sole Stockholder or any of his Affiliates (other than the Issuers or any of their Wholly-Owned Restricted Susidiaries) will not purchase or otherwise acquire, directly or indirectly, any of the Capital Stock of the Phase II Subsidiary, Mall Subsidiary or any of their respective Subsidiaries.

Limitation on Phase II Construction

The Mortgage Note Indenture provides that the Issuers shall not, and shall not permit any of their Subsidiaries (including Unrestricted Subsidiaries and Special Subsidiaries), at any time prior to receipt by the Issuers or any such Subsidiary of a temporary certificate of occupancy from Clark County, Nevada with respect to the Project (as currently defined) (a) to construct, develop or improve the Phase II Land or any building on the Phase II Land (including any excavation or site work and excluding the proposed parking garage on the Phase II Land), (b) enter into any contract or agreement for such construction, development or improvement, or for any materials, supplies or labor necessary in connection with such construction, development or improvement (other than a contract or agreement that is conditional upon satisfaction of the above condition), or (c) incur any Indebtedness the proceeds of which are expected to be used for the construction, development or improvement of the Phase II Land or any building on the Phase II Land, except (i) any construction, development or improvement on the Phase II Land or any temporary building on the Phase II Land in connection with the Project in accordance with the Plans and Specifications and included in the Project Budget; and (ii) any design, architectural, engineering or development work not involving actual construction on the Phase II Land.

Mortgage Note Guaranties

The Issuers' obligations under the Mortgage Notes, the Mortgage Note Indenture and the Collateral Documents are unconditionally guaranteed (i) on a senior, secured basis by the Secured Mortgage Note Guarantors and (ii) on a subordinated, unsecured basis by the Subordinated Mortgage Note Guarantors, pursuant to the terms of the Mortgage Note Indenture. The obligations of each Mortgage Note Guarantor under its Mortgage Note Guaranty is limited to the extent necessary under any applicable corporate law to ensure it does not constitute a fraudulent conveyance under applicable law.

Except in the event of a disposition of all or substantially all of the assets of a Mortgage Note Guarantor by way of merger or consolidation, the Mortgage Note Indenture provides that no Mortgage Note Guarantor shall consolidate with or merge with or into (whether or not such Mortgage Note Guarantor is the surviving Person), another Person, whether or not affiliated with such Mortgage Note Guarantor, unless (i) subject to the provisions of the following paragraph and certain other provisions of the Mortgage Note Indenture, the Person formed by or surviving any such consolidation or merger (if other than such Mortgage Note Guarantor) assumes all the obligations of such Mortgage Note Guarantor pursuant to a supplemental indenture and supplemental Collateral Documents in form reasonably satisfactory to the Mortgage Note Trustee pursuant to which such Person shall unconditionally guarantee, on either a senior or subordinated basis (equivalent to the existing Mortgage Note Guaranty), all of such Mortgage Note Guarantor's obligations under such Mortgage Note Guaranty, the Mortgage Note Indenture and the Collateral Documents on the terms set forth in the Mortgage Note Indenture;
(ii) immediately after giving effect to such transaction, no Default or Event of Default exists; (iii) such transaction will not result in the loss or suspension or material impairment of any material Gaming License; and (iv) the Company (A) will have Consolidated Net Worth (immediately after giving effect to such transaction), equal to or greater than the Consolidated Net Worth of the Company immediately preceding the transaction and (B) will be permitted by virtue of its pro forma Fixed Charge Coverage Ratio to incur, immediately after giving effect to such transaction, at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock." Notwithstanding anything herein to the contrary, a Wholly Owned Restricted Subsidiary of the Issuers that is a Mortgage Note Guarantor may consolidate or merge with, or sell or otherwise dispose of all or substantially all of its assets to, one of the Issuers or another Wholly Owned Restricted Subsidiary of the Issuers that is a Mortgage Note Guarantor.

The Mortgage Note Indenture provides that in the event of (i) a sale or other disposition of all or substantially all of the assets of any Mortgage Note Guarantor, by way of merger, consolidation or otherwise, (ii) a Restricted Subsidiary becoming an Unrestricted Subsidiary or a Special Subsidiary pursuant to terms of the Mortgage Note Indenture or (iii) a sale or other disposition of all of the Capital Stock of any Mortgage Note Guarantor that is a Subsidiary, then such Mortgage Note Guarantor (in the event of a sale or other disposition, by way of such a merger, consolidation or otherwise, of all of the Capital Stock of such Mortgage Note Guarantor or the Restricted Subsidiary becoming an Unrestricted Subsidiary or a Special Subsidiary pursuant to the terms of the Mortgage Note Indenture) or the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Mortgage Note Guarantor) shall be released and relieved of any obligations under its Mortgage Note Guaranty; provided that (i) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof and
(ii) the Net Proceeds of such sale or other disposition are applied in accordance with the applicable provisions of the Mortgage Note Indenture. See "--Repurchase at Option of Holders -- Asset Sales."

The Mortgage Note Indenture provides that if (a) either of the Issuers or any Restricted Subsidiary transfers or causes to be transferred, in one or a series of related transactions (other than a transaction or series of related transactions constituting a Restricted Payment permitted pursuant to the provisions of the Mortgage Note Indenture described above under the caption "Restricted Payments"), property or assets having a fair market value exceeding $1.0 million to any Restricted Subsidiary of the Issuers (other than a Mortgage Note Guarantor), (b) any Restricted Subsidiary that is not a Mortgage Note Guarantor shall have a net worth, annual revenues or net income in excess of $1.0 million (including by reason of acquisition, consolidation or merger) or shall own any material license, franchise or right used in the operation of any of the Project Assets of the Project or (c) an Unrestricted Subsidiary or Special Subsidiary ceases to be an

Unrestricted Subsidiary or Special Subsidiary, as the case may be, pursuant to the terms of the Mortgage Note Indenture or is designated by the Board of Directors to be a Restricted Subsidiary pursuant to the terms of the Mortgage Note Indenture and, in each case such Restricted Subsidiary shall have a net worth, annual revenues or net income in excess of $1.0 million (including by reason of acquisition, consolidation or merger) or shall own any material license, franchise or right used in the operation of any of the Project Assets of the Project, the Issuers shall cause such Restricted Subsidiary to (i) execute and deliver to the Mortgage Note Trustee a supplemental indenture and supplemental Collateral Documents in form reasonably satisfactory to the Mortgage Note Trustee pursuant to which such Restricted Subsidiary shall unconditionally guarantee, on a secured basis, all of the Issuers obligations under the Mortgage Notes, the Mortgage Note Indenture and the Collateral Documents on the terms set forth in the Mortgage Note Indenture and (ii) deliver to the Mortgage Note Trustee an opinion of counsel that, subject to customary assumptions and exclusions, such supplemental indenture and supplemental Collateral Documents have been duly executed and delivered by such Restricted Subsidiary. Such newly created Mortgage Note Guaranty will be secured by a lien or charge on all Note Collateral of such Restricted Subsidiary.

The payment of principal of, premium, if any, and interest on the Subordinated Mortgage Note Guaranties is subordinated in right of payment, as set forth in the Mortgage Note Indenture, to the prior payment in full of all Senior Debt of the Subordinated Mortgage Note Guarantors, whether outstanding on the date of the Mortgage Note Indenture or thereafter incurred.

Upon any distribution to creditors of the Subordinated Mortgage Note Guarantors in a liquidation or dissolution of the Subordinated Mortgage Note Guarantors in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Subordinated Mortgage Note Guarantors or their property, an assignment for the benefit of creditors or any marshalling of the Subordinated Mortgage Note Guarantors' assets and liabilities, the holders of Senior Debt of the Subordinated Mortgage Note Guarantors are entitled to receive payment in full of all Obligations due in respect of such Senior Debt of the Subordinated Mortgage Note Guarantors (including interest after the commencement of any such proceeding at the rate specified in the applicable Senior Debt of the Subordinated Mortgage Note Guarantors) before the Holders of Subordinated Mortgage Note Guaranties will be entitled to receive any payment with respect to the Subordinated Mortgage Note Guaranties, and until all Obligations with respect to Senior Debt of the Subordinated Mortgage Note Guarantors are paid in full, any distribution to which the holders of Subordinated Mortgage Note Guaranties would be entitled shall be made to the holders of Senior Debt of the Subordinated Mortgage Note Guarantors (except that Holders of Subordinated Mortgage Note Guaranties may receive Permitted Junior Securities and payments made from the trust described under "--Legal Defeasance and Covenant Defeasance"). The Subordinated Mortgage Note Guarantors also may not make any payment upon or in respect of the Subordinated Mortgage Note Guaranties (except in Permitted Junior Securities or from the trust described under "--Legal Defeasance and Covenant Defeasance") if (i) a default in the payment of the principal of, premium, if any, or interest on Senior Debt of the Subordinated Mortgage Note Guarantors occurs and is continuing beyond any applicable period of grace or (ii) any other default occurs and is continuing with respect to Senior Debt of the Subordinated Mortgage Note Guarantors that permits holders of the Senior Debt of the Subordinated Mortgage Note Guarantors as to which such default relates to accelerate its maturity and the Mortgage Note Trustee receives a notice of such default (a "Payment Blockage Notice") from the Subordinated Mortgage Note Guarantors or the holders of any Senior Debt of the Subordinated Mortgage Note Guarantors; provided, however, that, except to the extent provided in the second succeeding paragraph, the foregoing provisions shall not restrict the Issuers from making payments of principal, premium or interest on or with respect to the Mortgage Notes (including without limitation, by redemption, repurchase or other acquisition). Payments on the Subordinated Mortgage Note Guaranties may and shall be resumed (a) in the case of a payment default, upon the date on which such default is cured or waived and (b) in case of a nonpayment default, the earlier of the date on which such nonpayment default is cured or waived or 179 days after the date on which the applicable Payment Blockage Notice is received, unless the maturity of any Senior Debt of the Subordinated Mortgage Note Guarantors has been accelerated. No new period of payment blockage may be commenced unless and until (i) 360 days have elapsed since the effectiveness of the immediately prior Payment Blockage Notice and (ii) all scheduled payments of principal, premium, if any, and interest on the Subordinated Mortgage Note that have come due have been paid in full in cash. No nonpayment default that existed or was continuing on the date of delivery of any Payment Blockage Notice to the Mortgage Note Trustee shall be, or be made, the basis for a subsequent

Payment Blockage Notice unless such default shall have been waived for a period of not less than 180 days.

The Mortgage Note Indenture further requires that the Subordinated Mortgage Note Guarantors promptly notify holders of Senior Debt of the Subordinated Mortgage Note Guarantors if payment of the Mortgage Notes is accelerated because of an Event of Default.

As used in the foregoing, "Senior Debt" of the Subordinated Mortgage Note Guarantors means (i) the guaranties by the Subordinated Mortgage Note Guarantors of all Indebtedness outstanding under Bank Credit Facility and all Hedging Obligations with respect thereto, (ii) the guaranty by Mall Intermediate Holdings of all Indebtedness outstanding under the Mall Construction Loan Facility and all Hedging Obligation with respect thereto,
(iii) any other Indebtedness permitted to be incurred by the Subordinated Mortgage Note Guarantors under the terms of the Mortgage Note Indenture, unless the instrument under which such Indebtedness is incurred expressly provides that it is on a parity with or subordinated in right of payment to the Subordinated Mortgage Note Guaranties and (iv) all obligations with respect to the foregoing. Also, as used in the foregoing, "Permitted Junior Securities" means Equity Interests in the Subordinated Mortgage Note Guarantors or debt securities that are subordinated to all Senior Debt (and any debt securities issued in exchange for Senior Debt of the Mortgage Note Indenture) to substantially the same extent as, or to a greater extent than, the Subordinated Mortgage Note Guaranties are subordinated to Senior Debt of the Subordinated Mortgage Guarantors pursuant to the Mortgage Note Indenture.

Further Assurances

The Mortgage Note Indenture provides that the Issuers will (and will cause each of their Restricted Subsidiaries to) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register, any and all such further acts, deeds, conveyances, security agreements, mortgages, assignments, estoppel certificates, financing statements and continuations thereof, termination statements, notices of assignment, transfers, certificates, assurances and other instruments as may be reasonably required from time to time in order (i) to carry out more effectively the express purposes of the Collateral Documents, (ii) to subject to the Liens created by any of the Collateral Documents any of the properties, rights or interests required to be encumbered thereby and contemplated thereby, (iii) to perfect and maintain the validity, effectiveness and priority of any of the Collateral Documents and the Liens intended to be created thereby and contemplated thereby, and (iv) to better assure, convey, grant, assign, transfer, preserve, protect and confirm to the Mortgage Note Trustee any of the rights granted or now or hereafter intended by the parties thereto to be granted to the Mortgage Note Trustee or under any other instrument executed in connection therewith or granted to the Issuers under the Collateral Documents or under any other instrument executed in connection therewith.

Reports

Under the terms of the Mortgage Note Indenture, the Company will file with the Mortgage Note Trustee and provide holders of Mortgage Notes, within 15 days after it files them with the Commission, copies of its annual report and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may by rule or regulation prescribe) which the Company is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that the Company may not be required to remain subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the Commission, the Mortgage Note Indenture requires the Company to continue to file with the Commission and provide the Mortgage Note Trustee and each holder with, without cost to each holder, (a) within 90 days after the end of each fiscal year, annual reports on Form 10-K (or any successor form) containing the information required to be contained therein (or required in such successor form); (b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year, reports on Form 10-Q (or any successor form); and (c) promptly from time to time after the occurrence of an event required to be therein reported, such other reports on Form 8-K (or any successor form) containing the information required to be contained therein (or required in any successor form); provided, however, that the Company shall not be so obligated to file such reports with the Commission if the Commission does not permit such filings. Notwithstanding

the foregoing, if any Person that, directly or indirectly, owns more than 50% of the common equity of the Company is subject to the periodic reporting and the informational requirements of the Exchange Act, the Company will not be required to file the reports specified in the preceding sentence so long as it provides annual and quarterly financial statements of the Company (which will include summarized financial information concerning Venetian) to the holders of the Mortgage Notes. The Company will in all cases, without cost to each recipient, provide copies of such information to the holders of the Mortgage Notes and, if it is not permitted to file such reports with the Commission, shall make available such information to prospective purchasers and to securities analysts and broker-dealers upon their request. In addition, the Company has agreed that, for so long as any Mortgage Notes remain outstanding, it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Not later than the date of filing any quarterly or annual report, the Company shall deliver to the Mortgage Note Trustee an Officers' Certificate stating that each Restricted Payment made in the prior fiscal quarter was permitted and setting forth the basis upon which the calculations required by the covenant relating to "Restricted Payments" were computed, which calculations may be based upon the Company's latest available financial statements at the time of such Restricted Payment.

Security

To the extent permitted by applicable law and subject to any required approval of any Governmental Instrumentality, the Mortgage Notes are secured by a Lien on the Note Collateral owned by the Issuers and each Secured Mortgage Note Guaranty is secured by the Note Collateral owned by each Secured Mortgage Note Guarantors, in each case whether such Note Collateral is now owned or hereafter acquired. Such Lien is prior to all other Liens on the Note Collateral, except for Permitted Liens which includes the prior Lien on the Project Assets securing the Bank Credit Facility and the prior Lien on the Mall Collateral securing the Mall Construction Loan Facility and the Bank Credit Facility. Except for the Lien in favor of the Mortgage Notes on the Mortgage Notes Proceeds Account, the Liens securing the Bank Credit Facility and the Mall Construction Loan Facility will be prior to the Lien securing the Mortgage Notes. Mall Construction Lender has a first priority Lien on the Mall Collateral, the lenders under the Bank Credit Facility have a first priority Lien on the Project Assets and a second priority Lien on the Mall Collateral and the holders of the Mortgage Notes have a second priority Lien on the Project Assets and a third priority Lien on the Mall Collateral. Upon Completion and the satisfaction of certain other conditions, the assets comprising the Mall Collateral will be released from the Lien securing the Bank Credit Facility and the Mortgage Notes and transferred to the Mall Subsidiary in connection with the release of the Issuers and the Mall Construction Subsidiary from further obligations under the Mall Construction Loan Facility. Upon the creation of the Phase II Land as a separate parcel, the Phase II Land may be transferred to the Phase II Subsidiary and upon such transfer the Phase II Land will be released from the Lien securing the Bank Credit Facility and the Mortgage Notes. To the extent that any Specified FF&E is purchased (including providing any deposits) with the proceeds under the revolving loan facility of the Bank Credit Facility, all indebtedness under the Bank Credit Facility will be secured by the Note Collateral and such Specified FF&E and the Mortgage Note Trustee and the holders of the Mortgage Notes will have no security interest in such Specified FF&E.

So long as no Event of Default shall have occurred and be continuing, and subject to certain terms and conditions in the Mortgage Note Indenture and the Collateral Documents, the Issuers and their Subsidiaries are entitled to use the Note Collateral in a manner consistent with normal business practices. Upon the occurrence and during the continuance of an Event of Default, but subject to certain terms, conditions and limitations in the Intercreditor Agreement, the Mortgage Note Trustee may sell the Note Collateral or any part thereof in accordance with the terms of the Collateral Documents. All funds distributed under the Collateral Documents and received by the Mortgage Note Trustee for the benefit of the holders of the Mortgage Notes shall be distributed by the Mortgage Note Trustee in accordance with the provisions of the Mortgage Note Indenture. See "Description of Intercreditor Agreement."

Under the terms of the Collateral Documents but subject to certain terms, conditions and limitations set forth in the Intercreditor Agreement, the Mortgage Note Trustee determines the circumstances and manner in which the Note Collateral shall be disposed of, including, but not limited to, the determination

of whether to release all or any portion of the Note Collateral from the Liens created by the Collateral Documents and whether to foreclose on the Note Collateral following an Event of Default. Subject to certain additional provisions set forth in the Mortgage Note Indenture, the Note Collateral may be released from the Lien and security interest created by the Mortgage Note Indenture and the Collateral Documents at any time or from time to time upon the request of the Issuers pursuant to an Officers' Certificate certifying that all terms for release and conditions precedent under the Mortgage Note Indenture and under any applicable Collateral Document have been met and specifying (i) the identity of the Note Collateral to be released and (ii) the provision of the Mortgage Note Indenture which authorizes such release. The Mortgage Note Trustee shall release (at the sole cost and expense of the Issuers) (i) all Note Collateral that is contributed, sold, leased, conveyed, transferred or otherwise disposed of (including, without limitation, any Note Collateral that does not constitute Project Assets), and all Note Collateral that is contributed, sold, leased, conveyed, transferred or otherwise disposed of to an Unrestricted Subsidiary or Special Subsidiary but excluding any such contribution, sale, lease, conveyance, transfer or other distribution to the Company or a Restricted Subsidiary); provided, such contribution, sale, lease, conveyance, transfer or other disposition is or will be in accordance with provisions of the Mortgage Note Indenture, including, without limitation, the requirement that the net proceeds from such contribution, sale, lease, conveyance, transfer or other disposition are or will be applied (subject to the provisions of the Intercreditor Agreement) in accordance with the Mortgage Note Indenture and that no Default or Event of Default has occurred and is continuing or would occur immediately following such release; (ii) Note Collateral that is condemned, seized or taken by the power of eminent domain or otherwise confiscated pursuant to an Event of Loss; provided that the Net Loss Proceeds, if any, from such Event of Loss are or will be applied in accordance with the covenant described above under "Event of Loss"; (iii) all Note Collateral which may be released with the consent of holders pursuant to the amendment provisions of the Mortgage Note Indenture; (iv) the Mall Collateral and the Phase II Land, in accordance with the terms of the Mortgage Note Indenture and the Collateral Documents; (v) all Note Collateral (except as provided in the discharge and defeasance provisions of the Mortgage Note Indenture and, in particular, the funds in the trust fund described in such provisions) upon discharge or defeasance of this Indenture in accordance with the discharge and defeasance provisions of the Mortgage Note Indenture; (vi) all Note Collateral upon the payment in full of all obligations of the Issuers with respect to the Mortgage Notes and the Mortgage Note Guarantors with respect the Mortgage Note Guaranties; and (vii) Note Collateral of a Mortgage Note Guarantor whose Note Guaranty is released pursuant to the terms of the Mortgage Note Indenture.

Events of Default and Remedies

The Mortgage Note Indenture provides that each of the following constitutes an Event of Default: (i) default in payment when due and payable, upon redemption or otherwise, of principal or premium, if any, on the Mortgage Notes or under any Mortgage Note Guaranty; (ii) default for 30 days or more in the payment when due of interest on, or Liquidated Damages, if any, with respect to the Mortgage Notes or under any Mortgage Note Guaranty; (iii) failure by the Issuers or any Mortgage Note Guarantor to offer to purchase or to purchase the Mortgage Notes, in each case when required under an offer made pursuant to the provisions of the Mortgage Note Indenture; (iv) failure by (a) the Issuers or any Mortgage Note Guarantor to comply with the provisions described under the captions "Restricted Payments" or limitations on "Incurrence of Indebtedness and Issuance of Disqualified Stock" or (b) any Special Subsidiary to comply with the provisions described under the caption "Special Subsidiary Restricted Payments"; (v) failure by the Issuers or any Mortgage Note Guarantor for 45 days after receipt of written notice from the Mortgage Note Trustee to comply with any of its other agreements in the Mortgage Note Indenture, the Collateral Documents, the Mortgage Notes or the Mortgage Note Guaranties; provided, however, that any such failure with respect to any Collateral Documents will not be deemed to have occurred for purposes of the foregoing, and notice thereof shall not be deemed to have been delivered, until the delivery of notice and the expiration of all available grace periods provided for in the applicable Collateral Documents; (vi) default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed by the Issuers, any of their Restricted Subsidiaries or any Special Subsidiary or the payment of which is guaranteed by the Issuers, any of their Restricted Subsidiaries or any Special Subsidiary, whether such Indebtedness or Guaranty now exists or is created after the Issuance Date, which default (a) in the case of the Issuers or any of their Restricted

Subsidiaries only, is caused by a failure to pay when due at final maturity (giving effect to any grace period or waiver related thereto) the principal of such Indebtedness (a "Payment Default") or (b) results in the acceleration of such Indebtedness prior to its express maturity and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which a Payment Default then exists or with respect to which the maturity thereof has been so accelerated or which has not been paid at maturity, aggregates $10 million or more; (vii) failure by the Issuers or any of their Restricted Subsidiaries to pay final judgments aggregating in excess of $10 million, which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days; (viii) the repudiation by the Issuers or any of their Subsidiaries of its obligations under, or any judgment or decree by a court or governmental agency of competent jurisdiction declaring the unenforceability of, any Note Guarantee or any of the Collateral Documents for any reason that, in each case, would materially and adversely impair the benefits to the Mortgage Note Trustee or the holders of the Mortgage Notes thereunder; (ix) certain events of bankruptcy or insolvency with respect to the Issuers, any Special Subsidiary or any Mortgage Note Guarantor that is a Significant Subsidiary of the Issuers or any group of Mortgage Note Guarantors that together would constitute a Significant Subsidiary of the Issuers; (x) after the Project becomes Completed, revocation, termination, suspension or other cessation of effectiveness of any Gaming License, which results in the cessation or suspension of gaming operations for a period of more than 90 consecutive days at the Project; (xi) the Project is not Completed by the Outside Completion Deadline and continues to be not Completed; or (xii) failure by Interface to comply with its obligations under the Cooperation Agreement with respect to a change of control of Interface or a sale, transfer or other disposition by Interface of its interest in the Expo Center or the incurrence by Interface of Indebtedness.

Subject to the provisions of the Intercreditor Agreement, if any Event of Default (other than by reason of bankruptcy or insolvency) occurs and is continuing, the Mortgage Note Trustee or the holders of at least 25% in principal amount of the then outstanding Mortgage Notes may declare the principal, premium and Liquidated Damages, if any, interest and any other monetary obligations on all the Mortgage Notes to be due and payable immediately. See "Description of Intercreditor Agreement." Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to the Issuers, or any Mortgage Note Guarantor that is a Significant Subsidiary, all outstanding Mortgage Notes will become due and payable without further action or notice. Holders of the Mortgage Notes may not enforce the Mortgage Note Indenture or the Mortgage Notes except as provided in the Mortgage Note Indenture. Subject to certain limitations, holders of a majority in principal amount of the then outstanding Mortgage Notes may direct the Mortgage Note Trustee in its exercise of any trust power, including the exercise of any remedy under the Collateral Documents. The Mortgage Note Trustee may withhold from holders of Mortgage Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. In addition, the Mortgage Note Trustee shall have no obligation to accelerate the Mortgage Notes if in the best judgment of the Mortgage Note Trustee acceleration is not in the best interest of the holders of the Mortgage Notes.

In the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Issuers with the intention and for the purpose of avoiding payment of the premium that the Issuers would have had to pay if the Issuers then had elected to redeem the Mortgage Notes pursuant to the optional redemption provisions of the Mortgage Note Indenture, an equivalent premium shall also become and be immediately due and payable to the extent permitted by law.

The holders of a majority in aggregate principal amount of the Mortgage Notes then outstanding by notice to the Mortgage Note Trustee may on behalf of the holders of all of the Mortgage Notes waive any existing Default or Event of Default and its consequences under the Mortgage Note Indenture except a continuing Default or Event of Default in the payment of interest on, premium or Liquidated Damages, if any, or the principal of, any Mortgage Note held by a non-consenting holder.

For a discussion of the effect of the Intercreditor Agreement on the ability of the Mortgage Note Trustee or the holders of Mortgage Notes to exercise remedies after an Event of Default, see "Description of Intercreditor Agreement--Events of Default; Pre-Completion Remedies," and "--Events of Default; Post-Completion Remedies."

The Collateral Documents generally provide for the application of the internal laws of the State of New York, except to the extent that (i) the laws of Nevada are mandatory or (ii) validity or perfection of security interests in respect of certain items of collateral (such as real property) is governed by the laws of the jurisdiction where such collateral is located. The Mortgage Note Indenture, the Mortgage Notes and any Mortgage Note Guaranty provide, with certain exceptions, for the application of the internal laws of the State of New York. There is no certainty regarding whether New York or Nevada law would be applied by any court with respect to the enforcement of remedies under the Mortgage Notes, the Mortgage Note Indenture, any Mortgage Note Guaranty or the Collateral Documents.

Due to restrictions upon gaming activities in Nevada, the Mortgage Note Trustee may incur delays or possibly frustration in its effort to sell all or a portion of the Note Collateral. Operators of gaming facilities in Nevada are required to be licensed and are required by applicable Gaming Authorities to file applications, be investigated and be found suitable. Such requirements for governmental approval may delay or preclude a sale of the Note Collateral to a potential buyer at a foreclosure sale or sales. This may effectively limit the number of potential bidders and may delay such sales, either of which could adversely affect the sale price of the Note Collateral. In addition, the disposition of Note Collateral consisting of gaming devices is subject to the prior approval of the Nevada Board. Moreover, the gaming industry could become subject to different or additional regulations during the term of the Mortgage Notes, which could further adversely affect the practical rights and remedies that the Mortgage Note Trustee would have upon the occurrence of an Event of Default.

Before pursuing any foreclosures or otherwise executing on any of the Note Collateral, the Mortgage Note Trustee will need to consider the effect of Nevada law, which requires that where a debt is secured by real property, the debtor may require the creditor to exhaust its real property security before pursuing a judicial proceeding to obtain a monetary judgment against the debtor. If the creditor attempts to collect the indebtedness without first exercising its remedies under its deed of trust, the debtor could defend such action by requiring the creditor to first exhaust its rights under the deed of trust through statutory foreclosure proceedings. If, however, the debtor permitted the creditor to obtain a judgment without first exhausting remedies under the deed of trust, assuming such action was not stayed or dismissed before the entry of a final monetary judgment, then under Nevada law the lien of the deed of trust would be released and discharged. This Nevada law is referred to as the "One Action" Rule.

Real property pledged as security may be subject to known and unknown environmental risks or liabilities which can adversely affect the property's value. In addition, under the federal Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), as amended, for example, a secured lender may be held liable, in certain limited circumstances, for the costs of remediating a release of or preventing a threatened release of hazardous substances at a mortgaged property. There may be similar risks under state laws or common law theories.

Under CERCLA, a person "who, without participating in the management of a
. . . facility, holds indicia of ownership primarily to protect his security interest" is not a property owner, and thus not a responsible person under CERCLA. Lenders have seldom been held liable under CERCLA. The lenders who have been found liable have generally been found to have been sufficiently involved in the mortgagor's operations so that they have "participated in the management of the borrower." CERCLA does not specify the level of actual participation in management. CERCLA was amended in 1996 to provide certain "safe harbors" for foreclosing Lenders; however, the courts have not yet issued any definitive interpretations of the extent of these safe harbors. There is currently no controlling authority on this matter.

The Mortgage Note Trustee may appoint one or more collateral agents, who may be delegated any one or more of the duties or rights of the Mortgage Note Trustee under the Collateral Documents or which are specified in any Collateral Documents.

The Issuers are required to deliver to the Mortgage Note Trustee annually a statement regarding compliance with the Mortgage Note Indenture, and the Issuers are required, within five Business Days, upon becoming aware of any Default or Event of Default or any default under any document, instrument or agreement representing Indebtedness of the Issuers, to deliver to the Mortgage Note Trustee a statement specifying such Default or Event of Default.

No Personal Liability of Directors, Officers, Employees, Incorporators and Stockholders

No director, officer, employee, incorporator or stockholder of the Issuers or the Mortgage Note Guarantors, as such, has any liability for any obligations of the Issuers or the Mortgage Note Guarantors under the Mortgage Notes, any Mortgage Note Guaranty, the Mortgage Note Indenture, the Collateral Documents, as applicable, or for any claim based on, in respect of, or by reason of such obligations or their creation. Each holder of the Mortgage Notes by accepting a Mortgage Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Mortgage Notes and the Mortgage Note Guaranties.

Legal Defeasance and Covenant Defeasance

The obligations of the Issuers and the Mortgage Note Guarantors under the Mortgage Note Indenture will terminate (other than certain obligations) and the Note Collateral will be released upon payment in full of all of the Mortgage Notes. The Issuers may, at their option and at any time, elect to have all of their and any Mortgage Note Guarantor's obligations discharged with respect to the outstanding Mortgage Notes and any Mortgage Note Guarantees ("Legal Defeasance") and cure all then existing Events of Default except for (i) the rights of holders of outstanding Mortgage Notes to receive payments in respect of the principal of, premium, if any, and interest on such Mortgage Notes when such payments are due solely out of the trust created pursuant to the Mortgage Note Indenture, (ii) the Company's, Venetian's and any Mortgage Note Guarantor's obligations with respect to the Mortgage Notes concerning issuing temporary Mortgage Notes, registration of Mortgage Notes, mutilated, destroyed, lost or stolen Mortgage Notes and the maintenance of an office or agency for payment and money for security payments held in trust, (iii) the rights, powers, trusts, duties and immunities of the Mortgage Note Trustee, and the Issuers' and any Mortgage Note Guarantor's obligations in connection therewith and (iv) the Legal Defeasance provisions of the Mortgage Note Indenture. In addition, the Issuers may, at their option and at any time, elect to have the obligations of the Issuers and any Mortgage Note Guarantor released with respect to certain covenants that are described in the Mortgage Note Indenture ("Covenant Defeasance") and, thereafter, any omission to comply with such obligations shall not constitute a Default or Event of Default with respect to the Mortgage Notes. In the event Covenant Defeasance occurs, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) described under "Events of Default" will no longer constitute an Event of Default with respect to the Mortgage Notes. In addition, the Note Collateral will be released upon Covenant Defeasance or Legal Defeasance.

In order to exercise either Legal Defeasance or Covenant Defeasance, (i) the Issuers must irrevocably deposit with the Mortgage Note Trustee, in trust, for the benefit of the holders of the Mortgage Notes, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, premium and Liquidated Damages, if any, and interest due on the outstanding Mortgage Notes on the stated maturity date or on the applicable redemption date, as the case may be, in accordance with the terms of the Mortgage Notes Indenture; (ii) in the case of Legal Defeasance, the Issuers shall have delivered to the Mortgage Note Trustee an opinion of tax counsel in the United States reasonably acceptable to the Mortgage Note Trustee confirming that (A) the Issuers have received from the United States Internal Revenue Service a ruling (a copy of which shall accompany such opinion of counsel) or (B) since the Issuance Date of the Mortgage Note Indenture, there has been a change in the applicable U.S. federal income tax law such that a ruling is no longer required, in either case to the effect that, and based thereon such opinion of tax counsel in the United States shall confirm that, subject to customary assumptions and exclusions, the holders of the outstanding Mortgage Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; (iii) in the case of Covenant Defeasance, the Issuers shall have delivered to the Mortgage Note Trustee an opinion of tax counsel in the United States reasonably acceptable to the Mortgage Note Trustee confirming that the holders of the outstanding Mortgage Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (iv) no Default or Event of Default shall have occurred and be continuing

with respect to certain Events of Default on the date of such deposit; (v) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than the Mortgage Note Indenture) to which the Issuers or any of their Subsidiaries is a party or by which the Issuers or any of their Subsidiaries is bound; (vi) the Issuers shall have delivered to the Mortgage Note Trustee an opinion of counsel to the effect that, as of the date of such opinion following the deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally under any applicable United States state law and that the Mortgage Note Trustee has a perfected security interest in such trust funds for the ratable benefit of the holders; (vii) the Issuers shall have delivered to the Mortgage Note Trustee an Officers' Certificate stating that the deposit was not made by the Issuers with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuers or others; and (viii) the Issuers shall have delivered to the Mortgage Note Trustee an Officers' Certificate and an opinion of counsel in the United States (which opinion of counsel may be subject to customary assumptions and exclusions) each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance, have been complied with.

Transfer and Exchange

A Holder may transfer or exchange Mortgage Notes in accordance with the Mortgage Note Indenture. The Registrar and the Mortgage Note Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Issuers may require a Holder to pay any taxes and fees required by law or permitted by the Mortgage Note Indenture. The Issuers are not required to transfer or exchange any Mortgage Note selected for redemption. Also, the Issuers are not required to transfer or exchange any Mortgage Note for a period of 15 days before a selection of Mortgage Notes to be redeemed.

The registered Holder of a Mortgage Note will be treated as the owner of it for all purposes.

Amendment, Supplement and Waiver

Except as provided in the next three succeeding paragraphs, the Mortgage Note Indenture, the Mortgage Notes, the Mortgage Note Guaranties or the Collateral Documents may be amended or supplemented with the consent of the holders of at least a majority in principal amount of the Mortgage Notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for Mortgage Notes), and any existing default or compliance with any provision of the Mortgage Note Indenture, the Mortgage Notes, the Mortgage Note Guaranties or the Collateral Documents may be waived with the consent of the holders of a majority in principal amount of the then outstanding Mortgage Notes (including consents obtained in connection with a tender offer or exchange offer for Mortgage Notes).

Without the consent of each holder affected, an amendment or waiver may not (with respect to any Mortgage Notes held by a nonconsenting holder of Mortgage Notes): (i) reduce the principal amount of Mortgage Notes whose holders must consent to an amendment, supplement or waiver; (ii) reduce the principal of or change the fixed maturity of any Mortgage Note or alter or waive the provisions with respect to the redemption of the Mortgage Notes (other than provisions relating to the covenants described above under the caption "Repurchase at the Option of Holders"); (iii) reduce the rate of or change the time for payment of interest on any Mortgage Note; (iv) waive a Default or Event of Default in the payment of principal of, premium and Liquidated Damages, if any, or interest on the Mortgage Notes (except a rescission of acceleration of the Mortgage Notes by the holders of at least a majority in aggregate principal amount of the Mortgage Notes and a waiver of the payment default that resulted from such acceleration); (v) make any Mortgage Note payable in money other than that stated in the Mortgage Notes;
(vi) make any change in the provisions of the Mortgage Note Indenture relating to waivers of past Defaults or the rights of holders of Mortgage Notes to receive payments of principal of or premium and Liquidated Damages, if any, or interest on the Mortgage Notes; (vii) release all or substantially all of the Note Collateral from the Lien of the Mortgage Note Indenture or the Collateral Documents (other than in accordance with the Mortgage Note Indenture and the Collateral Documents); or (viii) make any change in the foregoing amendment and waiver provisions.

Notwithstanding the foregoing, without the consent of any holder of Mortgage Notes, the Issuers, the Mortgage Note Guarantors and the Mortgage Note Trustee together may amend or supplement the

Mortgage Note Indenture, the Mortgage Notes, the Mortgage Note Guaranties or the Collateral Documents to cure any ambiguity, defect or inconsistency, to comply with the covenant relating to mergers, consolidations and sales of assets, to provide for uncertificated Mortgage Notes in addition to or in place of certificated Mortgage Notes, to provide for the assumption of the Issuers' obligations to holders of the Mortgage Notes in the case of a merger or consolidation, to make any change that would provide any additional rights or benefits to the holders of the Mortgage Notes (including providing for additional Mortgage Note Guaranties pursuant to the Mortgage Note Indenture or additional collateral), or that does not adversely affect the legal rights under the Mortgage Note Indenture or the Collateral Documents of any such holder, to comply with requirements of the Commission in order to effect or maintain the qualification of the Mortgage Note Indenture under the Trust Indenture Act or to enter into additional or supplemental Collateral Documents.

Concerning the Mortgage Note Trustee

The Mortgage Note Indenture contains certain limitations on the rights of the Mortgage Note Trustee, should it become a creditor of the Issuers, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Mortgage Note Trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue or resign.

The holders of a majority in principal amount of the then outstanding Mortgage Notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy, available to the Mortgage Note Trustee, subject to certain exceptions. The Mortgage Note Indenture provides that in case an Event of Default shall occur (which shall not be cured), the Mortgage Note Trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in the conduct of his own affairs. Subject to such provisions, the Mortgage Note Trustee will be under no obligation to exercise any of its rights or powers under the Mortgage Note Indenture at the request of any holder of Mortgage Notes, unless such holder shall have offered to the Mortgage Note Trustee security and indemnity satisfactory to it against any loss, liability or expense.

Governing Law

The Mortgage Note Indenture and the Mortgage Notes are, subject to certain exceptions, governed by and construed in accordance with the internal laws of the State of New York, without regard to the choice of law rules thereof. The Collateral Documents are governed by the laws of the State of New York, except to the extent that (i) the laws of Nevada are mandatory or (ii) validity or perfection of security interests in respect of certain items of collateral, including, without limitation, real property, is governed by the laws of the jurisdiction where such collateral is located.

Additional Information

Any holder of the Mortgage Notes or prospective investor may obtain a copy of the Mortgage Note Indenture, the Registration Rights Agreement and the Collateral Documents without charge by writing to Las Vegas Sands, Inc., 3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109; Attention: Corporate Secretary.

Certain Definitions

Set forth below are certain defined terms used in the Mortgage Note Indenture. Reference is made to the Mortgage Note Indenture for full disclosure of all such terms, as well as any other capitalized terms used herein for which no definition is provided.

"Acquired Indebtedness" means, with respect to any specified Person, (i) Indebtedness of any other Person existing at the time such other Person merged with or into or became a Restricted Subsidiary of such specified Person, including Indebtedness incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Restricted Subsidiary of such specified Person and (ii) Indebtedness encumbering any asset acquired by such specified Person.

"Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this

definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, that beneficial ownership of 20% or more of the voting securities of a Person shall be deemed to be control.

"Applicable Tax Percentage" means the highest aggregate effective marginal rate of federal, state and local income tax or, when applicable, alternative minimum tax, to which any direct or indirect member or S corporation shareholder of the Issuers subject to the highest marginal rate of tax would be subject in the relevant year of determination (as certified to the Mortgage Note Trustee by a nationally recognized tax accounting firm), taking into account only that member's or S corporation shareholder's share of income and deductions attributable to its interest in the Issuers.

"Approved Equipment Funding Commitments" means, collectively, (a) the General Electric Capital Corporation Commitment (as defined in the Disbursement Agreement) and (b) any replacement of such commitment from an institutional or other lender reasonably acceptable to the Bank Agent and the Mall Construction Lender if (i) such commitment is in form and substance reasonably satisfactory to the Bank Agent and the Mall Construction Lender and does not include any conditions to funding that are not included in the General Electric Capital Corporation Commitment and (ii) the lender providing such commitment enters into intercreditor arrangements substantially similar to the intercreditor arrangements of General Electric Capital Corporation.

"Asset Sale" means (i) the sale, conveyance, transfer or other disposition (whether in a single transaction or a series of related transactions) of assets or rights (including by way of a sale and leaseback) of the Issuers or any Restricted Subsidiary (each referred to in this definition as a "disposition") or (ii) the issuance or sale of Equity Interests of any Restricted Subsidiary other than Venetian (whether in a single transaction or a series of related transactions), in each case, other than (a) a disposition of inventory or goods held in the ordinary course of business, (b) the disposition of all or substantially all of the assets of either of the Issuers in a manner permitted pursuant to the provisions described above under the caption "Certain Covenants--Merger, Consolidation or Sale of Assets" or any disposition that constitutes a Change of Control pursuant to the Mortgage Note Indenture, (c) any disposition that is a Restricted Payment or that is a dividend or distribution permitted under the covenant described above under the caption "Certain Covenants--Restricted Payments" or any Investment that is not prohibited thereunder or any disposition of cash or Cash Equivalents, (d) any single disposition, or related series of dispositions, of assets with an aggregate fair market value of less than $1.0 million, (e) any Event of Loss,
(f) any Lease Transaction or any grant of easement or Permitted Liens, (g) any dedication permitted pursuant to the covenant described above under the caption "Certain Covenants--Restrictions on Leasing and Dedication of Property," (h) the transfer of the Mall Collateral to the Mall Subsidiary, (i) the transfer of the Phase II Land to the Phase II Subsidiary, (j) a transfer of assets by the Issuers to a Wholly Owned Restricted Subsidiary of the Issuers or by a Wholly Owned Restricted Subsidiary of the Issuers to another Wholly Owned Restricted Subsidiary of the Issuers, (k) an issuance of Equity Interests by a Wholly Owned Restricted Subsidiary of the Issuers to the Issuers or another Wholly Owned Restricted Subsidiary of the Issuers, (l) any sale, conveyance, transfer or other disposition of property that secures Non-Recourse Financing or any financing permitted by clause (p) under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" that is to or on behalf of the lender of such Non-Recourse Financing or other financing or (m) any licensing of tradenames or trademarks in the ordinary course of business by any of the Issuers or their Restricted Subsidiaries.

"Bank Agent" means The Bank of Nova Scotia, in its capacity as administrative agent under the Bank Credit Facility and its successors in such capacity.

"Bank Credit Facility" means that certain Credit Agreement among the Company and Venetian, as borrowers, the lenders listed therein, Goldman Sachs Credit Partners L.P., as arranger and syndication agent and The Bank of Nova Scotia, as administrative agent, and any extension, refinancing, renewal, replacement, substitution or refund thereof ("Bank Credit Facility Refinancing"); provided, however that (i) the aggregate amount of such Bank Credit Facility Refinancing shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount

of reasonable expenses incurred and any premium paid in connection therewith) and (ii) such Bank Credit Facility Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded.

"Billboard Lease" means that certain Lease Agreement by and between Venetian and Mall Subsidiary relating to certain space that will be subleased by "Billboard Live!" as amended from time to time in accordance with the terms thereof.

"Capital Lease Obligation" means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on the balance sheet in accordance with GAAP.

"Capital Stock" means with respect to any Person, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock of such Person, including, without limitation, if such Person is a partnership or limited liability company, partnership or membership interests (whether general or limited) and any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, such partnership or limited liability company.

"Cash Equivalents" means (a) United States dollars, (b)(i) direct obligations of the United States of America (including obligations issued or held in book-entry form on the books of the Department of the Treasury of the United States of America) or obligations fully guaranteed by the United States of America, (ii) obligations, debentures, notes or other evidence of indebtedness issued or guaranteed by any other agency or instrumentality of the United States, (iii) interest-bearing demand or time deposits (which may be represented by certificates of deposit) issued by banks having general obligations rated (on the date of acquisition thereof) at least "A" by Standard & Poor's Corporation ("S&P") or "A2" by Moody's Investors Service, Inc. ("Moody's") (S&P and Moody's together with any other nationally recognized credit rating agency if neither of such corporations is then currently rating the pertinent obligations, a "Rating Agency") or the equivalent by another Rating Agency, if applicable, or, if not so rated, secured at all times, in the manner and to the extent provided by law, by collateral security in clause (i) or (ii) of this definition, of a market value of no less than the amount of monies so invested, (iv) commercial paper rated (on the date of acquisition thereof) at least "A-1" or "P-1" or the equivalent by any Rating Agency issued by any Person, (v) repurchase obligations for underlying securities of the types described in clause (i) or (ii) above, entered into with any commercial bank or any other financial institution having long-term unsecured debt securities rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency in connection with which such underlying securities are held in trust or by a third-part custodian, (vi) guaranteed investment contracts of any financial institution which has a long-term debt rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency, (vii) obligations (including both taxable and nontaxable municipal securities) issued or guaranteed by, and any other obligations the interest on which is excluded from income for Federal income tax purposes issued by, any state of the United States of America or the District of Columbia or the Commonwealth of Puerto Rico or any political subdivision, agency, authority or instrumentality thereof, which issuer or guarantor has (A) a short-term debt rated (on the date of acquisition thereof) at least "A-1" or "P-1" or the equivalent by any Rating Agency and (B) a long-term debt rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency, (viii) investment contracts of any financial institution either (A) fully secured by (1) direct obligations of the United States, (2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States or (3) securities or receipts evidencing ownership interest in obligations or specified portions thereof described in clause (1) or (2), in each case guaranteed as full faith and credit obligations of the United States of America, having a market value at least equal to 102% of the amount deposited thereunder, or (B) with long-term debt rated (on the date of acquisition of such investment contract) at least "A" or "A2" or the equivalent by any Rating Agency and short-term debt rated (on the date of acquisition of such investment contract) at least "A-1" or "P-1" or the equivalent by any Rating Agency, (ix) a contract or investment agreement with a provider or guarantor (A) which provider or guarantor is rated (on the date of acquisition of such contract or investment agreement) at least "A" or "A2" or the equivalent by any Rating Agency (provided that if a guarantor is party to the rating, the guaranty must be unconditional and must be confirmed in writing prior to any assignment by the provider to another subsidiary of such guarantor), (B) providing that monies invested shall be payable without condition (other than notice) and without brokerage fee or other penalty, upon not more than two Business Days' notice for application when

and as required or permitted under the Collateral Documents, and (C) stating that such contract or agreement is unconditional, expressly disclaiming any right of setoff and providing for immediate termination in the event of insolvency of the provider and termination upon demand of the Disbursement Agent if prior to Completion or (subject to the rights of creditors with prior Liens) the Mortgage Note Trustee if after Completion (which demand shall only be made at the direction of the Company) after any payment or other covenant default by the provider, or (x) any debt instruments of any Person which instruments are rated (on the date of acquisition thereof) at least "A," "A2," "A-1" or "P-1" or the equivalent by any Rating Agency; provided that in each case of clauses (i) through (x), such investments are denominated in United States dollars and maturing not more than 13 months from the date of acquisition thereof; (c) investments in any money market fund which is rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency; (d) investments in mutual funds sponsored by any securities broker-dealer of recognized national standing having an investment policy that requires substantially all the invested assets of such fund to be invested in investments described in any one or more of the foregoing clauses and having a rating of at least "A" or "A2" or the equivalent by any Rating Agency or (e) investments in both taxable and nontaxable (i) periodic auction reset securities which have final maturities between one and 30 years from the date of issuance and are repriced through a dutch auction or other similar method every 35 days or (ii) auction preferred shares which are senior securities of leveraged closed end municipal bond funds and are repriced pursuant to a variety of rate reset periods, in each case having a rating (on the date of aquisition thereof) of at least "A" or "A2" or the equivalent by any Rating Agency.

"Casino Lease" means that certain lease between the Company and Venetian dated as of the Closing Date with respect to the operation of the Casino for the Project, as amended, revised or modified from time to time in accordance with the terms thereof.

"Change of Control" means the occurrence of any of the following: (i) the sale, lease or transfer, in one or a series of transactions, of all or substantially all of the assets of the Issuers and their Restricted Subsidiaries, taken as a whole (except in connection with an Event of Loss);
(ii) either of the Issuers becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Sole Stockholder and its Related Parties, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of 50% or more of the total voting power of the Voting Stock of the Issuers; (iii) after an initial public offering of the common stock of the Issuers, the consummation of any transaction or series of transactions the result of which is that any person or group (as defined above), other than the Sole Stockholder and its Related Parties, (1) beneficially owns more of the voting power of the Voting Stock of the Issuers than is beneficially owned, in the aggregate, by the Sole Stockholder and its Related Parties and (2) beneficially owns more than 20% of the voting power of the Voting Stock of either of the Issuers; (iv) the first day within any two-year period on which a majority of the members of the Board of Directors of the Company are not Continuing Directors; (v) the adoption of a plan relating to liquidation or dissolution of either of the Issuers or any Mortgage Note Guarantor (except liquidation of (a) Venetian into the Company and (b) any Mortgage Note Guarantor into the Company, Venetian or another Mortgage Note Guarantor) or
(vi) if any Person other than the Sole Stockholder and Related Parties beneficially owns more than 50% of the voting and non voting common stock of the Company.

"Code" means, the Internal Revenue Code of 1986, as amended (or any successor statute thereto).

"Collateral Documents" means, collectively, the Mortgage Notes Indenture Leasehold Deed of Trust, the Mortgage Notes Indenture Fee Deed of Trust, the Mortgage Notes Indenture Mall Parcel Fee Deed of Trust, the Disbursement Agreement, the Completion Guaranty, the Mortgage Notes Indenture Leasehold Security Agreement, the Mortgage Notes Indenture Fee Security Agreement, the Mortgage Notes Indenture Environmental Indemnity or any other agreements, instruments, financing statements or other documents that evidence, set forth or limit the Lien of the Mortgage Note Trustee in the Note Collateral.

"Common Stock" means the Common Stock, par value $.10 per share, of the Company.

"Company" means Las Vegas Sands, Inc., a Nevada corporation, or any successor thereto permitted under the Mortgage Note Indenture.

"Completed" or "Completion" has the meaning given to the term "Mall Release Date" under the Disbursement Agreement, which term generally means that
(a) the Project has been substantially completed in substantial accordance with the Plans and Specifications (except for additions and expansions to the Casino Resort (other than the Mall) not contemplated by the Plans and Specifications in effect on the Issuance Date, which additions and expansions will be subject to certain limitations, including the requirement that they do not materially interfere with the use and operation of any other portion of the Casino Resort) and is free of Liens (other than Permitted Liens), (b) the furnishings, fixtures and equipment for the Casino and the Mall have been installed and the furnishings, fixtures and equipment for at least 2000 suites in the Hotel have been installed, (c) the scope and costs to complete remaining items have been quantified, and (d) the Issuers have sufficient available funds, pursuant to the Disbursement Agreement, to pay for remaining project costs plus a specified contingency, each as appropriately certified by the Construction Consultant and/or the Project Architect, all as more particularly set forth in the Disbursement Agreement.

"Completion Guaranty" means that certain Guaranty executed by the Sole Stockholder in favor of the Bank Agent (acting on behalf of the lenders under the Bank Credit Facility), the Mall Construction Lender and the Mortgage Notes Trustee (acting on behalf of the Mortgage Note holders) as amended, revised or modified from time to time in accordance with the terms thereof.

"Completion Guaranty Loan" means funds provided by the Sole Stockholder in satisfaction of his obligations pursuant to the Completion Guaranty which are treated by the Sole Stockholder and the Issuers as a subordinated loan to the Issuers pursuant to the Completion Guaranty.

"Consolidated Cash Flow" means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus (a) an amount equal to any extraordinary loss plus any net loss realized in connection with an Asset Sale (to the extent such losses were deducted in computing Consolidated Net Income), plus (b) provision for taxes based upon net income or net profits of such Person and its Restricted Subsidiaries to the extent such provision for taxes was deducted in computing Consolidated Net Income, plus (c) Consolidated Interest Expense of such Person for such period to the extent such expenses were deducted in computing Consolidated Net Income (not including any gaming revenue tax), plus (d) Consolidated Depreciation and Amortization Expense of such Person for such period to the extent such expenses were deducted in computing Consolidated Net Income, minus (e) non-cash items increasing such Consolidated Net Income for such period, in each case, on a consolidated basis for such Person and its Restricted Subsidiaries and determined in accordance with GAAP.

"Consolidated Depreciation and Amortization Expense" means with respect to any Person for any period, the total amount of depreciation and amortization expense and other noncash expenses (excluding any noncash expense that represents an accrual, reserve or amortization of a cash expenditure for a past, present or future period) of such Person and its Restricted Subsidiaries for such period on a consolidated basis as defined in accordance with GAAP.

"Consolidated Interest Expense" means, with respect to any period, the sum of (a) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, to the extent such expense was deducted in computing Consolidated Net Income (including original issue discount and deferred financing fees, non-cash interest payments, the interest component of Capital Lease Obligations, and net payments (if any) pursuant to Hedging Obligations, but excluding amortization of debt issuance costs and deferred financing fees), (b) commissions, discounts and other fees and charges paid or accrued with respect to letters of credit and bankers' acceptance financing and (c) to the extent not included above, the maximum amount of interest which would have to be paid by such Person or its Restricted Subsidiaries under a Guarantee of Indebtedness of any other Person if such Guarantee were called upon.

"Consolidated Net Income" means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided, however, that (i) the Net Income for such period of any Person that is not a Subsidiary or that is accounted for by the equity method of accounting, shall be

included only to the extent of the amount of dividends or distributions paid in cash (or to the extent converted into cash) to the referent Person or a Wholly Owned Subsidiary thereof in respect of such period, (ii) the Net Income of any Person acquired in a pooling of interests transaction shall not be included for any period prior to the date of such acquisition, (iii) the Net Income for such period of any Restricted Subsidiary that is not a Mortgage Note Guarantor shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of its Net Income is not at the date of determination permitted without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restriction with respect to the payment of dividends or in similar distributions has been legally waived, (iv) the cumulative effect of a change in accounting principles shall be excluded and (v) no effect shall be given to any minority or preferred interest in Venetian for purposes of computing Consolidated Net Income.

"Consolidated Net Worth" means, with respect to any Person at any time, the sum of the following items, as shown on the consolidated balance sheet of such Person and its Restricted Subsidiaries as of such date (i) the common equity of such Person and its Restricted Subsidiaries; (ii) (without duplication), (a) the aggregate liquidation preference of Preferred Stock of such Person and its Restricted Subsidiaries (other than Disqualified Stock), and (b) any increase in depreciation and amortization resulting from any purchase accounting treatment from an acquisition or related financing; (iii) less any goodwill incurred subsequent to the Issuance Date; and (iv) less any write up of assets (in excess of fair market value) after the Issuance Date, in each case on a consolidated basis for such Person and its Restricted Subsidiaries, determined in accordance with GAAP; provided, that in calculating Consolidated Net Worth, any gain or loss from any Asset Sale shall be excluded; provided, however that in computing "Consolidated Net Worth," no adjustment shall be made for any minority interest in Venetian.

"Construction Consultant" means Tishman Construction Corporation of Nevada or any other Person designated from time to time by the Bank Agent, the Mall Construction Lender and the Mortgage Notes Trustee, in their sole discretion acting pursuant to the Intercreditor Agreement, to serve as the Construction Consultant under the Disbursement Agreement.

"Construction Management Agreement" means that certain Construction Management Agreement between the Company and the Construction Manager, dated as of February 15, 1997, as such agreement may be amended, modified, supplemented, restated or replaced from time to time.

"Construction Manager" means Lehrer McGovern Bovis, Inc., a New York corporation.

"Continuing Directors" means, as of any date of determination, any member of the Board of Directors who (i) was a member of such Board of Directors on the Issuance Date, (ii) was nominated for election or elected to such Board of Directors with, or whose election to such Board of Directors was approved by, the affirmative vote of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election or (iii) was appointed or elected to such Board of Directors by the Sole Stockholder or a Related Party.

"Contracts" means, collectively, the contracts entered into, from time to time, between the Company and any contractor for performance of services or sales of goods in connection with the design, engineering, installation or construction of the Project.

"Cooperation Agreement" means that certain Amended and Restated Reciprocal Easement, Use and Operating Agreement among the Mall Construction Subsidiary, Venetian and Interface, as amended, revised or modified from time to time in accordance with its terms thereof.

"Default" means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.

"Direct Construction Guaranty" means that certain Guaranty of Performance and Completion executed by Bovis, Inc., a New York corporation, in favor of the Company, as assigned by the Company to Venetian by that certain Assignment Agreement by and among the Company, Venetian and Bovis, Inc., as amended, revised or modified from time to time in accordance with its terms.

"Disbursement Agent" means The Bank of Nova Scotia, in its capacity as the disbursement agent under the Disbursement Agreement and its successors in such capacity.

"Disbursement Agreement" means that certain Funding Agents' Disbursement and Administration Agreement among the Issuers, Mall Construction Subsidiary, the Bank Agent, the Mortgage Notes Trustee, the Mall Construction Lender, the HVAC Provider and the Disbursement Agent as amended, revised or modified from time to time in accordance with its terms.

"Disqualified Stock" means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to November 15, 2004; provided, however, that any Capital Stock which would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require the Issuers to repurchase or redeem such Capital Stock upon the occurrence of a Change of Control, and Event of Loss or an Asset Sale occurring prior to the final maturity of the Mortgage Notes shall not constitute Disqualified Stock if the change of control provisions, event of loss provisions, or asset sale provisions, as the case may be, applicable to such Capital Stock specifically provide that the Issuers will not repurchase or redeem any such stock pursuant to such provisions prior to the Company's and Venetian's compliance with the provisions of the Mortgage Note Indenture, including the covenant described under "Repurchase at the Option of Holders-- Change of Control," "--Event of Loss" and "--Asset Sales."

"Equity Contribution" means the approximately $320.3 million of proceeds received by Venetian from the Company, Interface Holding or the Sole Stockholder (in the form of cash or property).

"Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

"Estimation Period" means the period for which a shareholder, partner or member, who is an individual is required to estimate for federal income tax purposes his allocation of taxable income from a Subchapter S corporation or a partnership for federal income tax purposes in connection with determining his estimated federal income tax liability for such period.

"Event of Loss" means, with respect to any property or asset (tangible or intangible, real or personal), any of the following: (A) any loss, destruction or damage of such property or asset; (B) any actual condemnation, seizure or taking by exercise of the power of eminent domain or otherwise of such property or asset, or confiscation of such property or asset or the requisition of the use of such property or asset; or (C) any settlement in lieu of clause (B) above.

"Excess Mall Proceeds" means the aggregate cash proceeds received by Mall Subsidiary from borrowings or from debt or equity issuances in excess of the cash amounts necessary to fund Mall Subsidiary's obligation to purchase certain assets pursuant to the Sale and Contribution Agreement.

"Existing Indebtedness" means (i) up to $1.5 million in aggregate principal amount of Indebtedness (other than Capital Lease Obligations) of the Company or its Restricted Subsidiaries in existence on the Issuance Date, plus interest accruing thereon, after application of the net proceeds of sale of the Mortgage Notes on the Issuance Date and (ii) any current or future obligations under the HVAC Services Agreement as in effect on the Issuance Date.

"Expo Center" means the Sands Expo and Convention Center.

"Fixed Charge Coverage Ratio" means, with respect to any Person for any period, the ratio of the Consolidated Cash Flow of such Person for such period to the Fixed Charges of such Person for such period. In the event that the Company or any of its Restricted Subsidiaries incurs, assumes, guarantees or redeems any Indebtedness (other than revolving credit borrowings) or issues Preferred Stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee or redemption of Indebtedness and the use of proceeds

therefrom, or such issuance or redemption of Preferred Stock, as if the same had occurred at the beginning of the applicable four-quarter period. For purposes of making the computation referred to above, acquisitions, dispositions and discontinued operations (as determined in accordance with GAAP) that have been made by the Company or any of its Restricted Subsidiaries, including all mergers, consolidations and dispositions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date shall be calculated on a pro forma basis assuming that all such acquisitions, dispositions, discontinued operations, mergers, consolidations (and the reduction of any associated fixed charge obligations resulting therefrom) had occurred on the first day of the four-quarter reference period.

"Fixed Charges" means, with respect to any Person for any period, the sum, without duplication, of (a) Consolidated Interest Expense of such Person for such period and (b) all capitalized interest of such Person and its Restricted Subsidiaries and (c) the product of (i) to the extent such Person is not treated as an S corporation, a partnership or a substantially similarly treated pass-through entity for federal income tax purposes, all dividend payments, whether or not in cash on any series of Preferred Stock of such Person or any of its Subsidiaries, other than dividend payments on Equity Interests payable solely in Equity Interests or dividends paid as an increase in liquidation preference on Preferred Stock, times (ii) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory income tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP.

"GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect on the Issuance Date. For the purposes of the Mortgage Note Indenture, the term "consolidated" with respect to any Person shall mean such Person consolidated with its Restricted Subsidiaries (without giving effect to any minority or preferred interest of Venetian) and shall not include any Unrestricted Subsidiary or Special Subsidiary.

"Gaming Authority" means any agency, authority, board, bureau, commission, department, office or instrumentality of any nature whatsoever of the United States or foreign government, any state, province or any city or other political subdivision, whether now or hereafter existing, or any officer or official thereof, including without limitation, the Nevada Gaming Commission, the Nevada State Gaming Control Board, the Clark County Liquor and Gaming Licensing Board and any other agency with authority to regulate any gaming operation (or proposed gaming operation) owned, managed or operated by the Issuers or any of its Subsidiaries.

"Gaming License" means every license, franchise or other authorization required to own, lease, operate or otherwise conduct governing activities of the Issuers or any of their Restricted Subsidiaries, including without limitation, all such licenses granted under the Nevada Gaming Control Act, and the regulations promulgated pursuant thereto, and other applicable federal, state, foreign or local laws.

"Government Instrumentality" means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, public or statutory instrumentality, authority, body, agency, bureau or entity, (including any zoning authority, the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central bank or any comparable authority) or any arbitrator with authority to bind a party at law.

"Government Securities" means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended), as custodian with respect to any such Government Security or a specific payment of principal of or interest on any such Government Security held by such custodian for the account

of the holder of such depository receipt; provided, that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Security or the specific payment of principal of or interest on the Government Security evidenced by such depository receipt.

"Guaranty" means a guaranty (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness.

"Harrah's Road Way Agreement" means an agreement between Venetian and Harrah's Casino Resort as amended, revised, modified or restated, as contemplated by the existing Letter of Intent between the parties with respect to the sharing of the common roadway between the parties and certain plans with respect to the improvements to be made thereto.

"Hedging Obligations" means, with respect to any Person, the obligations of such Person under (i) currency exchange or interest rate swap agreements, currency exchange or interest rate cap agreements and currency exchange or interest rate collar agreements and (ii) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange or interest rates.

"HVAC Provider" means Atlantic-Pacific Las Vegas, LLC, a Delaware limited liability company.

"HVAC Services Agreement" means, collectively (i) that certain Energy Services Agreement between Venetian and the HVAC Provider, (ii) that certain Ground Lease between Venetian and the HVAC Provider, (iii) that certain Construction Agency Agreement between Venetian and the HVAC Provider and (iv) that certain Energy Services Agreement between Mall Subsidiary and the HVAC Provider, in each case, as amended from time to time in accordance with its terms.

"Indebtedness" means, with respect to any Person, (a) any indebtedness of such Person, whether or not contingent (i) in respect of borrowed money, (ii) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof), (iii) representing the balance deferred and unpaid of the purchase price of any property (including Capital Lease Obligations), except any such balance that constitutes an accrued expense or trade payable, or (iv) representing any Hedging Obligations, if and to the extent any of the foregoing indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of such Person prepared in accordance with GAAP, (b) to the extent not otherwise included, any obligation by such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness of another Person (other than by endorsement of negotiable instruments for collection in the ordinary course of business) and (c) to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset owned by such Person (whether or not such Indebtedness is assumed by such Person). For purposes of this definition, the term "Indebtedness" shall not include any amount of the liability in respect of an operating lease that at such time would not be required to be capitalized and reflected as a liability on the balance sheet in accordance with GAAP. The amount of any Indebtedness outstanding as of any date shall be (i) the accreted value thereof, in the case of any Indebtedness with original issue discount, and (ii) the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness.

"Independent Financial Advisor" means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the judgment of the Company's Board of Directors, (i) qualified to perform the task for which it has been engaged and (ii) disinterested and independent with respect to the Company and its Subsidiaries, each Affiliate of the Company, and the Sole Stockholder and its Related Parties.

"Indirect Construction Guaranty" means that certain Guaranty of Performance executed by The Peninsular and Oriental Steam Navigation Company, a corporation organized under the laws of England and Wales, in favor of the Company, as assigned by the Company to Venetian by that certain Assignment Agreement by and among the Company, Venetian and The Peninsular and Oriental Steam Navigation Company as amended, revised, modified or restated from time to time in accordance with its terms.

"Intercreditor Agreement" means the Intercreditor Agreement, among The Bank of Nova Scotia, as Bank Agent acting on behalf of the other lenders pursuant to the Bank Credit Facility, the Mortgage Note

Trustee, acting on behalf of the holders of the Mortgage Notes, the Mall Construction Lender and the Senior Subordinated Note Trustee, acting on behalf of the holders of the Senior Subordinated Notes, as amended, revised, modified or restated from time to time in accordance with its terms.

"Interface" means Interface Group-Nevada, Inc., a Nevada corporation and wholly owned indirect subsidiary of the Sole Stockholder.

"Investments" means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including Guarantees), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities and all other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP.

"Issuance Date" means the closing date for the sale and original issuance of the Mortgage Notes.

"Lenders" means any of the lenders under the Bank Credit Facility, the Mall Construction Lender and the Mortgage Note holders.

"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).

"Mall" means that certain enclosed retail, dining and entertainment complex of approximately 500,000 net leasable square feet more particularly described in the Plans and Specifications.

"Mall Collateral" means all of the Issuers' and their Subsidiaries' right, title, and interest in and to (i) prior to the creation of the Mall I Parcel, the leasehold estate created by the Mall Lease and, thereafter, the Mall I Parcel; (ii) the leasehold estate created by the Billboard Lease; (iii) the Mall and any related improvements and equipment thereto; (iv) any reserves established by the Issuers, any of their Restricted Subsidiaries or any of their Special Subsidiaries relating to the Mall; and (v) any and all security agreements and an assignment of leases and rents creating a security interest in any rents or other income derived from the Mall.

"Mall Construction Lender" means GMAC Commercial Mortgage Corporation, a California corporation, and its permitted successors and assigns.

"Mall Construction Loan Agreement" means that certain Credit Agreement between the Issuers, Mall Construction Subsidiary and Mall Construction Lender, as amended, revised or modified from time to time in accordance with its terms.

"Mall Construction Loan Facility" means the credit facility described and made available to the Issuers and Mall Construction Subsidiary pursuant to the Mall Construction Loan Agreement and any extension, refinancing, renewal, replacement, substitution or refunding thereof ("Mall Construction Loan Facility Refinancing"); provided, however that (i) the aggregate amount of Indebtedness under such Mall Construction Loan Facility Refinancing shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (ii) such Mall Construction Loan Facility Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded and (iii) to the extent such Mall Construction Loan Facility Refinancing Indebtedness is not supported by a guaranty of the Sole Stockholder on substantially similar terms as the terms of the Sole Stockholder's guaranty of Tranche B of the Mall Construction Loan Facility, such Mall Construction Loan Facility Refinancing Indebtedness shall contain a tranche with a principal amount, relative payment priority and other terms which are substantially similar to those required to be contained in the Substitute Tranche B Loan.

"Mall Construction Subsidiary" means Grand Canal Shops Mall Construction, LLC, a Delaware limited liability company and a wholly owned subsidiary of Venetian.

"Mall Holdings" means Grand Canal Shops Mall Holding Company, LLC, a Delaware limited liability company and a subsidiary of Mall Intermediate Holdings.

"Mall Intermediate Holdings" means Mall Intermediate Holding Company, LLC, a Delaware limited liability company, and a wholly owned subsidiary of Venetian.

"Mall I Parcel" means the Mall Space subdivided from the Project Site as a legally separate parcel and recorded with the applicable Government Instrumentalities.

"Mall Lease" means the Lease by and between Venetian and Mall Construction Subsidiary pursuant to which Mall Construction Subsidiary leases from Venetian the Mall Space, as amended, revised or modified from time to time in accordance with its terms.

"Mall Management Agreement" means the Mall Management Agreement between Forest City Enterprises and the Mall Contruction Subsidiary, as amended, revised or modifed.

"Mall Manager" means Grand Canal Shops Mall MM, Inc., a wholly owned subsidiary of the Company.

"Mall Space" means that certain space upon which the Mall will be located as more specifically described in an Annex to the Mortgage Note Indenture.

"Mall Subsidiary" means Grand Canal Shops Mall, LLC, a Delaware limited liability company.

"Mortgage Note Make-Whole Premium" means, with respect to a Mortgage Note, an amount equal to the greater of (i) 12.25% of the outstanding principal amount of such Mortgage Note and (ii) the excess of (a) the present value of the remaining interest, premium and principal payments due on such Mortgage Note as if such Mortgage Note were redeemed on November 15, 2001, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the outstanding principal amount of such Mortgage Note.

"Mortgage Notes" means the Company's 12 1/4% Mortgage Notes due November 15, 2004 issued pursuant to the Mortgage Note Indenture.

"Mortgage Notes Indenture Environmental Indemnity" means that Environmental Indemnity Agreement among the Company, Venetian and the Mortgage Note Trustee, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Fee Deed of Trust" means that certain Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing made by the Company and Venetian, as trustor, to the trustee thereunder, for the benefit of the Mortgage Note Trustee, as beneficiary, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Leasehold Deed of Trust" means that certain Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing and made by the Mall Construction Subsidiary, as trustor, to the trustee thereunder, for the benefit of the Mortgage Note Trustee, as beneficiary, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Mall Parcel Fee Deed of Trust" means the deed of trust in the form of Exhibit V-4 to the Disbursement Agreement to be executed by Mall Construction Subsidiary for the benefit of the Mortgage Note Trustee in accordance with the Disbursement Agreement, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Proceeds Account" means that certain Mortgage Notes Proceeds Account into which the net proceeds from the sale of the Mortgage Notes were deposited in accordance with the Disbursement Agreement.

"Net Income" means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Stock dividends, excluding, however, (i) any gain (but not loss), together with any related provision for taxes on such gain (but not loss), realized in connection with (a) any Asset Sale (including, without limitation, dispositions pursuant

to sale and leaseback transactions) or (b) the disposition of any securities or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries, and (iii) excluding any extraordinary gain (but not loss), together with any related provision for taxes on such extraordinary gain (but not loss).

"Net Loss Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Event of Loss, including, without limitation, insurance proceeds from condemnation awards or damages awarded by any judgment, net of the direct costs in recovery of such Net Loss Proceeds (including, without limitation, legal, accounting, appraisal and insurance adjuster fees and expenses) and any taxes paid or payable as a result thereof (including, without limitation, any taxes paid or payable by an owner of the Issuers or any Restricted Subsidiary).

"Net Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale, net of the direct costs relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees and expenses, employee severance and termination costs, any trade payables or similar liabilities related to the assets sold and required to be paid by the seller as a result thereof and sales, finder's or broker's commissions), and any relocation expenses incurred as a result thereof, taxes paid or payable as a result thereof (including, without limitation, any taxes paid or payable by an owner of the Issuers or any Restricted Subsidiary) (after taking into account any available tax credits or deductions and any tax sharing arrangements), amounts required to be applied to the repayment of Indebtedness secured by a Lien (other than the Mortgage Notes) on the asset or assets that are the subject of such Asset Sale or amounts permitted by the terms of such Indebtedness to be otherwise reinvested in the Project to the extent so reinvested, all distributions and other payments required to be made to minority interest holders in a subsidiary or joint venture as a result of the Asset Sale and any reserve for adjustment in respect of the sale price of such asset or assets or any liabilities associated with the asset disposed of in such Asset Sale.

"Non-Recourse Financing" means Indebtedness incurred in connection with the purchase or lease of personal or real property useful in the Principal Business or to construct, develop or equip the Mall Space and (i) as to which the lender upon default may seek recourse or payment against the Company or any Restricted Subsidiary only through the return or sale of the property or equipment or the other Specified FF&E so purchased or leased, or in the case of any Indebtedness with respect to the Mall Space, only through foreclosure upon the Mall Collateral and (ii) may not otherwise assert a valid claim for payment on such Indebtedness against the Company or any Restricted Subsidiary or any other property of the Company or any Restricted Subsidiary.

"Non-Recourse Indebtedness" means Indebtedness or Disqualified Stock, as the case may be, or that portion of Indebtedness or Disqualified Stock, as the case may be, (a) as to which neither the Company nor any of its Restricted Subsidiaries (i) provides credit support pursuant to any undertaking, agreement or instrument that would constitute Indebtedness or Disqualified Stock, as the case may be, or (ii) is directly or indirectly liable, and (b) with respect to Non-Recourse Indebtedness of an Unrestricted Subsidiary, no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness or Disqualified Stock, as the case may be, of the Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or Disqualified Stock, as the case may be, or cause the payment thereof to be accelerated or payable prior to its stated maturity.

"Note Collateral" means all assets, now owned or hereafter acquired, of the Company, Venetian or any Mortgage Note Guarantor defined as Collateral in the Collateral Documents, which will initially include (with certain exceptions) all real estate, improvements and all personal property owned by the Issuers (including (i) the Project Assets, (ii) the Mall Collateral, until the transfer and release thereof in accordance with the Sale and Contribution Agreement and the Disbursement Agreement), as well as a pledge of any intercompany notes held by either of the Issuers or the Mortgage Note Guarantors.

"Obligations" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

"Officers' Certificate" means a certificate signed on behalf of the Issuers or a Mortgage Note Guarantor, as the case may be, by two Officers (or if a limited liability company, two Officers of the

managing member of such limited liability company) of the Issuers or a Mortgage Note Guarantor, as the case may be, one of whom must be the principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of the Company, Venetian (or its managing members) or a Mortgage Note Guarantor, as the case may be, that meets the requirements set forth in the Mortgage Note Indenture.

"Other Phase II Agreements" means any agreement entered into by the Issuers or their Subsidiaries with a Person for construction, development and operation of a hotel or casino on the Phase II Land (other than the Phase II Resort).

"Outside Completion Deadline" means April 21, 1999, as the same may from time to time be extended pursuant to the Disbursement Agreement.

"Permitted Construction Loan Refinancing" means (i) the incurrence of indebtedness and/or the issuance of Capital Stock by the Mall Subsidiary the proceeds of which are used to purchase the Mall Collateral pursuant to the Sale and Contribution Agreement (including, without limitation, the Tranche A Take-out Commitment and the Tranche B Take-out Commitment) and/or (ii) the assumption of the Mall Construction Loan Facility and/or the Substitute Tranche B Loan (or any permitted refinancing thereof) pursuant to the Sale and Contribution Agreement.

"Permitted Investments" means (a) any Investments in the Issuers, any Mortgage Note Guarantor or in any Restricted Subsidiary that is not a Mortgage Note Guarantor if the Investments in such Restricted Subsidiary that is not a Mortgage Note Guarantor from the Issuers, any Mortgage Note Guarantor or any of the other Restricted Subsidiaries aggregate less than $1.0 million; (b) any Investments in Cash Equivalents; (c) Investments by the Issuers or any Restricted Subsidiary of the Issuers in a Person, if as a result of such Investment (i) such Person becomes a Mortgage Note Guarantor or (ii) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, one of the Issuers or a Mortgage Note Guarantor; (d) any Restricted Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above under the caption "Repurchase at the Option of Holders--Asset Sales"; (e) any acquisition of assets solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Issuers; (f) receivables owing to the Issuers or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances; (g) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business; (h) loans or advances to employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries (i) to fund the exercise price of options granted under the employment agreements and the Issuers' stock option plans or agreements, in each case, as in effect on the date of the Mortgage Note Indenture or (ii) for any other purpose not to exceed $2.0 million in the aggregate at any one time outstanding under this clause (ii); (i) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Issuers and any Restricted Subsidiary or in satisfaction of judgments; (j) other Investments in any Person (other than in an Affiliate of the Issuers) having a fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (j) that are at the time outstanding, not to exceed $5.0 million; (k) Investments in any person engaged in the Principal Business which Investment is solely in the form of Equity Interests (other than Disqualified Stock) of the Issuers and (l) the initial designation on the Issuance Date of (i) Phase II Subsidiary, Phase II Holdings and Phase II Manager as Unrestricted Subsidiaries and (ii) Mall Subsidiary, Mall Holdings and Mall Manager as Special Subsidiaries; provided that in each case, no more than $1,000 is invested in any such Person at the time of designation.

"Permitted Liens" means (a) Liens in favor of the Issuers and their Wholly Owned Restricted Subsidiaries; provided that if such Liens are on any Note Collateral, that such Liens are either collaterally assigned to the Mortgage Note Trustee or subordinate to the Lien in favor of the Mortgage Note Trustee securing the Mortgage Notes or any Mortgage Note Guaranty; (b) Liens on property of a Person existing

at the time such Person became a Restricted Subsidiary, is merged into or consolidated with or into, or wound up into, one of the Issuers or any Restricted Subsidiary of the Issuers; provided, that such Liens were in existence prior to the contemplation of such acquisition, merger or consolidation or winding up and do not extend to any other assets other than those of the Person acquired by, merged into or consolidated with one of the Issuers or such Restricted Subsidiary; (c) Liens on property existing at the time of acquisition thereof by the Issuers or any Restricted Subsidiary of the Issuers; provided that such Liens were in existence prior to the contemplation of such acquisition; (d) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business or in the construction of the Project and which obligations are not expressly prohibited by the Mortgage Note Indenture; provided, however, that the Issuers have obtained a title insurance endorsement insuring against losses arising therewith or if such Lien arises in the ordinary course of business or in the construction of the Project, the Issuers have bonded within a reasonable time after becoming aware of the existence of such Lien; (e) Liens securing obligations in respect of the Mortgage Note Indenture, the Mortgage Notes and any Secured Mortgage Note Guaranty; (f) leases or Liens, to the extent permitted pursuant to the covenant entitled "Restrictions on Leasing and Dedication of Property"; (g) (1) Liens for taxes, assessments or governmental charges or claims or (2) statutory Liens of landlords, and carriers', warehousemen's, mechanics', suppliers', materialmen's, repairmen's or other similar Liens arising in the ordinary course of business or in the construction of the Project, in the case of each of (1) and (2), with respect to amounts that either (A) are not yet delinquent or (B) are being contested in good faith by appropriate proceedings as to which appropriate reserves or other provisions have been made in accordance with GAAP; (h) easements, rights-of-way, navigational servitudes, restrictions, minor defects or irregularities in title and other similar charges or encumbrances which do not interfere in any material respect with the ordinary conduct of business of the Issuers and their Restricted Subsidiaries; (i) after Completion, Liens securing Indebtedness in an aggregate amount not exceeding $25.0 million at any one time securing purchase money or lease obligations otherwise permitted by the Mortgage Note Indenture incurred or assumed in connection with the acquisition, purchase or lease of real or personal property to be used in the Principal Business of the Issuers or any of their Restricted Subsidiaries within 180 days of such incurrence or assumption; provided, that such Liens do not extend to any Note Collateral or to any property or assets of the Issuers or any Restricted Subsidiary other than the property or assets so purchased or leased and, at the time of incurrence, the principal amount of such Indebtedness does not exceed 75% of the value of the collateral securing such Indebtedness; (j) a leasehold mortgage in favor of a party financing the lessee of space within the Project; provided that (i) the lease affected by such leasehold mortgage is permitted pursuant to the covenant entitled "Restrictions on Leasing and Dedication of Property," (ii) neither the Issuers nor any Restricted Subsidiary is liable for the payment of any principal of, or interest or premium on, such financing and
(iii) the affected lease and leasehold mortgage are expressly made subject and subordinate to the Lien of the Mortgage Notes Indenture Leasehold Deed of Trust and the Mortgage Notes Indenture Fee Deed of Trust, subject to the provisions of the last paragraph in the covenant described under the caption "-- Restrictions on Leasing and Dedication of Property"; (k) Liens securing the Mall Construction Loan Facility and any additional Indebtedness permitted to be incurred thereunder pursuant to clause (n)(A) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock;" (l) Liens created or contemplated by the Cooperation Agreement and the HVAC Services Agreement; (m) Liens on real property of the Issuers arising pursuant to that certain Harrah's Road Way Agreement; (n) Liens created by the Predevelopment Agreement, as in effect on the date of the Mortgage Note Indenture; (o) Liens (i) to secure Indebtedness permitted by clauses (g), (h) or (p) of the second paragraph of the covenant entitled "--Incurrence of Indebtedness and Issuance of Preferred Stock" and extending only to assets or Specified FF&E acquired in accordance with such clause and to any proceeds of such assets or Indebtedness and related collateral accounts in which such proceeds are held, and (ii) to secure Indebtedness permitted by clause (d) of the second paragraph of the covenant entitled "--Incurrence of Indebtedness and Issuance of Preferred Stock"; provided that such Liens are not materially greater in extent than the Liens securing the Indebtedness so refinanced; (p) Liens created by the Other Phase II Agreements; (q) Liens prior to the Lien securing the Mortgage Notes to secure all Obligations under the Bank Credit Facility incurred pursuant to clause (a) of the second paragraph of the covenant described above under the caption "--Incurrence of

Indebtedness and Issuance of Disqualified Stock" and any additional Indebtedness permitted to be incurred thereunder pursuant to clause (n)(A) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock;"
(r) until Completion is achieved, Permitted Liens (as defined in the Disbursement Agreement); (s) Liens incurred in connection with the construction of a pedestrian bridge over or a pedestrian tunnel under Las Vegas Boulevard and Sands Avenue; (t) Liens incurred in connection with the traffic study relating to increased traffic on Las Vegas Boulevard as a result of the Completion of the Project; (u) Liens incurred in connection with Hedging Obligations incurred pursuant to clause (f) of the covenant described under the caption "Limitations on Incurrence of Indebtedness and the Issuance of Disqualified Stock"; (v) licenses of patents, trademarks and other intellectual property rights granted by the Issuers or any Subsidiary of the Issuers in the ordinary course of business and not interfering in any material respect with the ordinary conduct of the business of such Issuer or such Subsidiary; (w) any judgment attachment or judgment Lien not constituting an Event of Default; (x) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;
(y) any Lien created under the Sale and Contribution Agreement and (z) after Completion, Liens prior to the Lien securing the Mortgage Notes securing (A) up to an aggregate of $20.0 million of Indebtedness permitted to be incurred pursuant to clause (n)(B) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" and (B) up to an aggregate of $20.0 million of Indebtedness permitted to be incurred pursuant to clause (o) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock."

"Permitted Quarterly Tax Distributions" means quarterly distributions of Tax Amounts determined on the basis of the estimated taxable income of the Company or Venetian, as the case may be (in each case, including any such taxable income attributable to such entity's ownership of interest in any other pass-through entity for Federal income tax purposes (except that if all or any portion of the Completion Guaranty Loan or the Substitute Tranche B Loan is outstanding and held by the Sole Stockholder or a Related Party and is not paying current cash interest, then such estimated taxable income shall be determined without giving effect to any non-cash interest payments on such loans held by the Sole Stockholder or the Related Parties to the extent such non-cash interest is deductible)), for the related Estimation Period, as in a statement filed with the Mortgage Note Trustee, provided; however, that (A) prior to any distributions of Tax Amounts the Issuers shall deliver an officers' certificate to the effect that, in the case of distributions to be made by Venetian, Venetian qualifies as a partnership or a substantially similarly treated pass-through entity for federal income tax purposes or that, in the case of distributions to be made by the Company, the Company qualifies as a Subchapter S corporation under the Code or a substantially similarly treated pass-through entity for federal income tax purposes, as the case may be, and (B) at the time of such distributions, the most recent audited financial statements of the Company reflect that the Company was treated as a Subchapter S corporation under the Code or a substantially similarly treated pass-through entity for federal income tax purposes and Venetian was treated as a partnership or substantially similarly treated pass-through entity for Federal income tax purposes for the period covered by such financial statements; provided, further, that, for an Estimation Period that includes a True-up Determination Date, (A) if the True-up Amount is due to the members or shareholders, as the case may be, the Permitted Quarterly Tax Distribution payable by the Company or Venetian, as the case may be, for the Estimation Period shall be increased by such True-up Amount, and (B) if the True-up Amount is due to the Company or Venetian, the Permitted Quarterly Tax Distribution payable by the Company or Venetian, as the case may be, for the Estimation Period shall be reduced by such True-up Amount and the excess, if any, of the True-up Amount over such Permitted Quarterly Tax Distribution shall be applied to reduce the immediately following Permitted Quarterly Tax Distribution(s) until such True-up Amount is entirely offset. The amount of Permitted Quarterly Tax Distribution relating to an Estimation Period including a True-up Determination Date shall be determined by a Tax Amounts CPA, and the amount of Permitted Quarterly Tax Distribution relating to all other Estimation Periods shall be determined by the Company or Venetian, as the case may be.

"Person" means any individual, corporation, partnership, limited liability company or partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

"Phase II Holdings" means Lido Casino Resort Holding Company, LLC, a Delaware limited liability company and a subsidiary of Phase II Intermediate Holdings.

"Phase II Intermediate Holdings" means Lido Intermediate Holding Company, LLC, a Delaware limited liability company, and a Wholly Owned Subsidiary of the Company.

"Phase II Land" means that portion of the Project Site designated as the Phase II Land in the Collateral Documents, together with all improvements thereon and all rights appurtenant thereto.

"Phase II Manager" means Lido Casino Resort MM, Inc., a special purpose Wholly Owned Subsidiary of the Company.

"Phase II Resort" means the themed hotel and casino currently contemplated to be constructed on the Phase II Land and which will be physically connected to the Casino Resort.

"Phase II Subsidiary" means Lido Casino Resort, LLC, a Nevada limited liability company and, at the Issuance Date, an Unrestricted Subsidiary of the Issuers.

"Plans and Specifications" means the plans and specifications for the construction of the Casino Resort listed in an exhibit to the Disbursement Agreement, as the same may be modified from time to time in accordance with the Disbursement Agreement.

"Pre-development Agreement" means the Sands Resort Hotel & Casino Agreement dated February 18, 1997 by and between Clark County and the Company as amended, revised, modified and restated.

"Preferred Stock" means any Equity Interest with preferential right of payment of dividends or upon liquidation, dissolution, or winding up.

"Principal Business" means the casino gaming, hotel, retail and entertainment mall and resort business and any activity or business incidental, directly related or similar thereto (including owning interests in Subsidiaries, operating the conference center and meeting facilities and owning and operating a retail and entertainment mall (including the Mall prior to its transfer to the Mall Subsidiary) and acting as a member of Venetian in the case of the Company), or any business or activity that is a reasonable extension, development or expansion thereof or ancillary thereto, including any hotel, entertainment, recreation, convention, trade show, meeting, retail sales or other activity or business designed to promote, market, support, develop, construct or enhance the casino gaming, hotel, retail and entertainment mall and resort business operated by the Company, Venetian and direct and indirect Restricted Subsidiaries (including, without limitation, engaging in transactions with Affiliates and incurring Indebtedness, providing guarantees or providing other credit support, in each case to the extent permitted under the Mortgage Note Indenture), owning and operating joint ventures to supply materials or services for the construction or operation of any resorts owned or operated by the Company and its Restricted Subsidiaries and entering into casino leases or management agreements for any casino situated on land owned by the Issuers or any of their Subsidiaries or owned or operated by the Issuers or any Affiliate of the Issuers.

"Project" means the Venetian-themed hotel, casino, retail, meeting and entertainment complex, with related heating, ventilation and air conditioning and power station facilities to be developed at the Project Site, all as more particularly described in Exhibit T-1 to the Disbursement Agreement.

"Project Architect" means collectively, TSA of Nevada, LLP, and WAT&G, Inc. Nevada.

"Project Assets" means, with respect to the Project at any time, all of the assets then in use related to the Project including any real estate assets, any buildings or improvements thereon, and all equipment, furnishings and fixtures, but excluding: (i) the Phase II Land and/or the Mall Collateral and any improvements thereon after their transfer to the Unrestricted Subsidiary or Special Subsidiary as permitted by the Mortgage Note Indenture; (ii) any obsolete personal property determined by the Company's Board of Directors to be no longer useful or necessary to the operations or support of the Project;
(iii) the equipment owned by the HVAC Provider (unless purchased by Venetian or Mall Construction Subsidiary after the date hereof); and (iv) any equipment leased from a third party in the ordinary course of business.

"Project Budget" means the Project Budget as in effect on the Issuance Date and attached as an exhibit to the Disbursement Agreement, as amended, revised or modified from time to time in accordance with the terms thereof.

"Project Documents" means the Construction Management Agreement, the Direct Construction Guaranty, the Indirect Construction Guaranty, the Contracts, the Approved Equipment Funding Commitments, the Cooperation Agreement, the HVAC Services Agreement, the Mall Lease, the Sale and Contribution Agreement, the Treadway Agreement, the operating agreement of each of Venetian, Mall Intermediate Holdings, Mall Holdings and Mall Subsidiary and any other document or agreement entered into, relating to the development, construction, maintenance or operation of the Project (other than the documents relating to the Tranche A Take-out Commitment and the Tranche B Take-out Commitment) as the same may be amended from time to time in accordance with the terms and conditions of the Disbursement Agreement.

"Public Equity Offering" means a bona fide underwritten sale to the public of common equity of the Company, Venetian or a Person holding more than 50% of the common equity of the Company pursuant to a registration statement (other than on Form S-8 or any other form relating to securities issuable under any benefit plan of the Company) that is declared effective by the SEC and results in gross aggregate proceeds to the Company or Venetian of at least $20.0 million.

"Quarterly Payment Period" means the period commencing on the tenth day and ending on and including the twentieth day of each month in which federal estimated tax payments are due (provided that payments in respect of estimated state income taxes due in January may instead, at the option of the Issuers, be paid during the last five days of the immediately preceding December).

"Redemption Triggering Event" means (i) a Public Equity Offering; or (ii) the receipt by the Issuers or any of their Restricted Subsidiaries of Excess Mall Proceeds.

"Related Parties" means (i) any spouse and any child, stepchild, sibling or descendant of the Sole Stockholder, (ii) any estate of the Sole Stockholder or any person under clause (i), (iii) any person who receives a beneficial interest in the Company or Venetian from any estate under clause (ii) to the extent of such interest, (iv) any executor, personal administrator or trustee who holds such beneficial interest in the Company or Venetian for the benefit of, or as fiduciary for, any person under clauses (i), (ii) or (iii) to the extent of such interest, (v) any corporation, trust, or similar entity owned or controlled by the Sole Stockholder or any person referred to in clause (i),
(ii), (iii) or (iv) or for the benefit of any person referred to in clause (i) and (vi) the spouse or issue of one or more of the individuals described in clause (i).

"Repurchase Offer" means an offer made by the Issuers to purchase all or any portion of a holder's Mortgage Notes pursuant to the covenants described above under the captions entitled "Repurchase at the Option of Holders--Change of Control," "Repurchase at the Option of Holders--Asset Sales," or "Repurchase at the Option of Holders--Event of Loss."

"Restricted Investment" means (i) an Investment other than a Permitted Investment or (ii) any sale, conveyance, lease, transfer or other disposition of assets at less than fair market value to an Unrestricted Subsidiary, provided that the amount of such Restricted Investment under this clause (ii) shall be such difference in value.

"Restricted Subsidiary" means, at any time, any direct or indirect Subsidiary of the Issuers that is not then an Unrestricted Subsidiary or a Special Subsidiary; provided, however, that upon the occurrence of any Unrestricted Subsidiary or Special Subsidiary ceasing to be an Unrestricted Subsidiary or Special Subsidiary, such Subsidiary shall be included in the definition of "Restricted Subsidiary."

"Sale and Contribution Agreement" means that certain Sale and Contribution Agreement among the Venetian, Mall Construction Subsidiary and Mall Subsidiary, as such agreement may be amended, modified or renewed from time to time in accordance with its terms.

"Senior Subordinated Notes" means the $97.5 million in aggregate principal amount of the Issuers 14 1/4% Senior Subordinated Notes due 2005, and any series of senior subordinated notes issued in exchange for such Senior Subordinated Notes pursuant to the Exchange Offer contemplated by the Registration Rights Agreement.

"Senior Subordinated Note Guarantors" means Phase II Intermediate Holdings, Mall Intermediate Holdings, Mall Construction Subsidiary and all future Restricted Subsidiaries of the Issuers.

"Senior Subordinated Note Indenture" means that certain Indenture by and among the Issuers, the Senior Subordinated Note Guarantors and the Senior Subordinated Note Trustee, as amended or supplemented from time to time.

"Senior Subordinated Note Trustee" means First Union National Bank, in its capacity as trustee.

"Services Agreement" means that Amended and Restated Services Agreement by and among the Company, Interface, Interface Holdings and the parties stated on the signature page thereto, as amended from time to time in accordance with its terms.

"Significant Subsidiary" means any Subsidiary which would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Act, as such Regulation is in effect on the Issuance Date.

"Sole Stockholder" means Sheldon G. Adelson.

"Special Subsidiary" means the Mall Subsidiary, Mall Holdings, Mall Manager and any other Subsidiary so designated by the Board of Directors of the Company in accordance with the terms of the Mortgage Note Indenture.

"Special Subsidiary Permitted Investments" means with respect to any Special Subsidiary (a) any Investments in a Wholly Owned Subsidiary of such Special Subsidiary engaged in a Special Subsidiary Principal Business; (b) any Investments in Cash Equivalents; (c) receivables owing to such Special Subsidiary or any Wholly Owned Subsidiary of such Special Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Special Subsidiary deems reasonable under the circumstances; (d) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business; (e) loans or advances to employees made in the ordinary course of business of the Special Subsidiary; (f) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to Special Subsidiary or a Subsidiary or in satisfaction of judgments and (g) other Investments in any Person (other than an Affiliate of the Special Subsidiary) having a fair market value (measured on the date of each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other investments made pursuant to this clause (g) that are at the time outstanding, not to exceed $5.0 million.

"Special Subsidiary Principal Business" means business limited to the following: (i) to acquire, hold, own, manage, market and operate a retail, restaurant and entertainment complex known as the Grand Canal Shops Mall (the "Property"), located at 3355 Las Vegas Boulevard, South, Las Vegas, Nevada,
(ii) to engage in the retail, restaurant and entertainment business at the Property and any activity and business incidental, directly related or similar thereto, and (iii) to engage in any business or activity that is a reasonable extension, development or expansion thereof or ancillary thereto including any retail, restaurant, entertainment or other activity or business designed to promote, market, support, develop, construct or enhance the retail, restaurant and entertainment business operated by the Mall Subsidiary (including, without limitation, owning and operating joint ventures to supply materials or services for the construction or operation of the Property, engaging in transactions with Affiliates to the extent permitted under the Mortgage Note Indenture, and incurring Indebtedness, providing guarantees or providing other credit support). Special Subsidiary Principal Business does not mean any of the foregoing to the extent engaged in on the Phase II Land.

"Special Subsidiary Restricted Investment" means (i) an Investment by a Special Subsidiary or a Subsidiary of a Special Subsidiary other than a Special Subsidiary Permitted Investment or (ii) any Investment by a Special Subsidiary or a Subsidiary of a Special Subsidiary in the equity of the Issuers or any of the Issuers' Restricted Subsidiaries.

"Specified FF&E" means any furniture, fixtures, equipment and other personal property financed or refinanced with the proceeds from the incurrence of Indebtedness pursuant to clauses (g), (h) or (p) of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock," including (i) each and every item or unit of equipment acquired with proceeds thereof, (ii) each and every item or unit of equipment acquired in substitution or replacement thereof, (iii) all parts,

components and other items pertaining to such collateral, (iv) all documents (including without limitation all warehouse receipts, dock receipts, bills of lading and the like), (v) all licenses (other than gaming licenses), warranties, guaranties, service contracts and related rights and interests covering all or any portion of such collateral, (vi) to the extent not otherwise included, all proceeds (including insurance proceeds) of any of the foregoing and all accessions to, substitutions and replacements for, and the rents, profits and products of, each of the foregoing, and (vii) so long as Indebtedness under the Bank Credit Facility is outstanding, such other collateral reasonably determined by the lenders under the Bank Credit Facility to be collateral for Indebtedness incurred in connection with the purchase of Specified FF&E so long as the Lien securing Indebtedness incurred under the Bank Credit Facility does not extend to such collateral.

"Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

"Subordinated Indebtedness" means any Indebtedness of the Issuers or any of their Restricted Subsidiaries which is expressly by its terms subordinated in right of payment to the Mortgage Notes or any Mortgage Note Guaranty.

"Subsidiary" means, with respect to any Person, (i) any corporation, association, or other business entity (other than a partnership) of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof and (ii) any partnership of which more than 50% of the partnership's capital accounts, distribution rights or general or limited partnership interests are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof.

"Substitute Tranche B Loan" means amounts drawn upon under the guarantee of the Sole Stockholder of the Tranche B loan of the Mall Construction Loan Facility, which amounts, when drawn upon may be treated as a subordinated loan to the Issuers from the Sole Stockholder.

"Supplier Joint Venture" means any Person that supplies or provides materials or services to the Issuers or the Construction Manager or any contractor in the Project and in which the Issuers or one of their Restricted Subsidiaries have Investments.

"Tax Amount" means, with respect to a Estimation Period or a taxable year, as the case may be, an amount equal to (A) the product of (x) the taxable income (including all separately stated items of income) of the Company or Venetian, as the case may be, for such Estimation Period or a taxable year, as the case may be, and (y) the Applicable Tax Percentage reduced by (B) to the extent not previously taken into account, any income tax benefit attributable to the Company or Venetian, as the case may be, which could be utilized (without regard to the actual utilization) by its members or shareholders, as the case may be, in the current or any prior taxable year, or portion thereof, commencing on or after the Issuance Date (including any tax losses or tax credits), computed at the Applicable Tax Percentage of the year that such benefit is taken into account for purposes of this computation; provided, however, that, the computation of Tax Amount shall also take into account (C) the deductibility of state and local taxes for federal income tax purposes, and (D) any difference in the Applicable Tax Percentage resulting from the nature of taxable income (such as capital gain as opposed to ordinary income).

"Tax Amounts CPA" means a nationally recognized certified public accounting firm.

"Tranche A Take-out Commitment" means the commitment of Goldman Sachs Mortgage Company or such other lender suitable to the Issuers, to enter into and make a loan in an aggregate of up to $105.0 million thereunder under the Permitted Mall Construction Refinancing or any other commitment to make such a loan that replaces the commitment of Goldman Sachs Mortgage Company in accordance with the Tri-Party Agreement.

"Treadway Agreement" means that certain Time and Materials Agreement between Owner and Contractor, dated as of February 10, 1997, by and between the Company and Treadway Industries of

Phoenix, Inc., an Arizona corporation, as amended, modified or revised from time to time in accordance with its terms.

"Tranche B Take-out Commitment" means the commitment of the Sole Stockholder to enter into and fund a loan to Mall Subsidiary in an aggregate of up to $35.0 million under the Permitted Construction Loan Refinancing or any other commitment to make such a loan that replaces the commitment of the Sole Stockholder in accordance with the Tri-Party Agreement.

"Treasury Rate" means the yield to maturity at the time of the computation of the United States Treasury securities with a constant maturity (as compiled by and published in the most recent Federal Reserve Statistical Release H.15(519), which has become publicly available at least two Business Days prior to the date fixed for prepayment (or, if such Statistical Release is no longer published, any publicly available source of similar market data) most nearly equal to the then remaining average life to November 15, 2001; provided, however, that if the average life of such Mortgage Note is not equal to the constant maturity of the United States Treasury security for which weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the average life of such Mortgage Notes is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

"Tri-Party Agreement" means the agreement between Venetian, the Company, the Sole Stockholder, the Mall Construction Subsidiary, the Mall Subsidiary, the Mall Construction Lender and Goldman Sachs Mortgage Company (or any successor provider of the Tranche A Take-out Commitment), as amended or replaced from time to time in accordance with its terms.

"True-up Amount" means, in respect of a particular taxable year, an amount determined by the Tax Amounts CPA equal to the difference between (i) the aggregate Permitted Quarterly Tax Distributions actually distributed in respect of such taxable year, without taking into account any adjustment to such Permitted Quarterly Tax Distributions made with respect to any other taxable year (including any adjustment to take into account a True-up Amount for the immediately preceding taxable year) and (ii) the Tax Amount permitted to be distributed in respect of such year as determined by reference to the Company's Internal Revenue Service Form 1120-S or Venetian's IRS Form 1065 filed for such year; provided, however, that if there is an audit or other adjustment with respect to a return filed by the Company or Venetian (including a filing of an amended return), upon a final determination or resolution of such audit or other adjustment, the Tax Amounts CPA shall redetermine the True- up Amount for the relevant taxable year. The amount equal to the excess, if any, of the amount described in clause (i) above over the amount described in clause (ii) above shall be referred to as the "True-up Amount due to the Company" or the "True-up Amount due to Venetian," as the case may be, and the excess, if any, of the amount described in clause (ii) over the amount described in clause (i) shall be referred to as the "True-up Amount due to the shareholders or members."

"True-up Determination Date" means the date on which the Tax Amounts CPA delivers a statement to the Mortgage Note Trustee indication the True-up Amount; provided, however, that the True-up Determination Date shall not be later than 30 days after the occurrence of an event requiring the determination of the True-up Amount (including, the filing of the federal and state tax returns or the final determination or resolution of an audit or other adjustment, as the case may be).

"Unrestricted Subsidiary" means (i) each of Phase II Holdings, Phase II Manager and Phase II Subsidiary; and (ii) any entity that would have been a Restricted Subsidiary of the Company but for its designation as an "Unrestricted Subsidiary" in accordance with the provisions of the Mortgage Note Indenture and any Subsidiary of such entity, so long as it remains an Unrestricted Subsidiary in accordance with the terms of the Mortgage Note Indenture.

"Venetian" means, Venetian Casino Resort, LLC, a Nevada limited liability company.

"Voting Stock" means, with respect to any Person that is a corporation, any class or series of capital stock of such Person that is ordinarily entitled to vote in the election of directors thereof at a meeting of stockholders called for such purpose, without the occurrence of any additional event or contingency and with respect to any other Person that is a limited liability company, membership interests entitled to manage the operations or business of the limited liability company.

"Weighted Average Life to Maturity" means, when applied to any Indebtedness or Disqualified Stock, as the case may be, at any date, the number of years (calculated to the nearest one-twelfth) obtained by dividing (a) the sum of the products obtained by multiplying (x) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (y) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (b) the then outstanding principal amount or liquidation preference, as applicable, of such Indebtedness or Disqualified Stock, as the case may be.

"Wholly Owned Restricted Subsidiary" is any Wholly Owned Subsidiary that is a Restricted Subsidiary.

"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors' qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such Person.

"Working Capital Facility" means the credit facility pursuant to any agreement or agreements providing for the making of loans or advances on a revolving basis, the issuance of letters of credit and/or the creation of bankers' acceptances to fund the Issuers' or any of their Restricted Subsidiaries' general corporate requirements and any amendment, supplement, extension, modification, renewal, replacement or refinancing from time to time, including any agreement to renew, extend, refinance or replace all or any portion of such facility.

DESCRIPTION OF SENIOR SUBORDINATED NOTES

General

The Senior Subordinated Notes were issued pursuant to the Senior Subordinated Note Indenture among the Issuers, the Senior Subordinated Note Guarantors and First Union National Bank, as trustee (the "Senior Subordinated Note Trustee"), in a private transaction that was not subject to the registration requirements of the Securities Act. See "Notice to Investors." The Senior Subordinated Notes are fully, unconditionally and jointly and severally guaranteed (each a "Senior Subordinated Note Guaranty" and, together, the "Senior Subordinated Note Guaranties"), by each existing Restricted Subsidiary and any future Restricted Subsidiary of the Issuers (each, a "Senior Subordinated Note Guarantor" and, together, the "Senior Subordinated Note Guarantors"), with certain exceptions, pursuant to the terms of the Senior Subordinated Note Indenture. The terms of the Senior Subordinated Notes include those stated in the Senior Subordinated Note Indenture and those made part of the Senior Subordinated Note Indenture by reference to the Trust Indenture Act. The Senior Subordinated Notes are subject to all such terms, and holders of Senior Subordinated Notes are referred to the Senior Subordinated Note Indenture and the Trust Indenture Act for a statement thereof. The following summary of the material provisions of the Senior Subordinated Note Indenture does not purport to be complete and is qualified in its entirety by reference to the Senior Subordinated Note Indenture, including the definitions therein of certain terms used below. A copy of the form of Senior Subordinated Note Indenture is available from the Company as described under "Additional Information." The definitions of certain terms used in the following summary are set forth below under "--Certain Definitions." Capitalized terms that are used but not otherwise defined in this Prospectus have the meanings assigned them in the Senior Subordinated Note Indenture. A copy of the Senior Subordinated Note Indenture has been filed with the Commission as an exhibit to the Registration Statement. For purposes of this "Description of Senior Subordinated Notes," the term "Issuers" refers only to the Issuers and not to any of their respective Subsidiaries, the term the "Company" refers only to Las Vegas Sands, Inc. and not to any of its Subsidiaries, and the term "Venetian" refers only to Venetian Casino Resort, LLC and not to any of its Subsidiaries.

The Senior Subordinated Notes are general unsecured obligations of the Issuers and are subordinated in right of payment to all existing and future Senior Debt of the Issuers and are senior or pari passu in right of payment to all existing and future subordinated indebtedness of the Issuers. The Senior Subordinated Notes also are effectively subordinated to the Indebtedness of any Subsidiaries of the Issuers that are not Senior Subordinated Note Guarantors. See "--Subordination." Upon completion of the Casino Resort, the Issuers will have $812.7 million of Senior Debt outstanding. In addition, under the Senior Subordinated Note Indenture, the Issuers are permitted to incur additional Senior Debt under certain circumstances. See "Description of Intercreditor Agreement." The Mall Subsidiary (which is not a Senior Subordinated Note Guarantor) may incur up to $140.0 million of Indebtedness under the Mall Take- out Financings upon the transfer of the Mall Collateral to refinance the Indebtedness under the Mall Construction Loan Facility. See "--Subordination" and "--Certain Covenants--Limitations on Incurrence of Indebtedness."

Principal, Maturity and Interest

The Senior Subordinated Notes are joint and several secured obligations of the Issuers, limited in aggregate principal amount to $97.5 million and will mature on November 15, 2005. The Senior Subordinated Notes bear interest from November 14, 1997 at the rate of 10.0% per annum on their principal amount at maturity through and including November 15, 1999 and after such date until maturity at a rate of 14 1/4% per annum on their principal amount at maturity. Installments of interest will become due and payable semi-annually in arrears on May 15 and November 15 of each year, commencing May 15, 1998, to the holders of record at the close of business on the preceding May 1 or November 1. The Senior Subordinated Notes were issued at a discount from their principal amount at maturity (92.812% of the principal amount at maturity) and will accrue to par by the second anniversary of the original date of issuance. Additionally, installments of accrued and unpaid interest will become due and payable with respect to any principal amount of the Senior Subordinated Notes that matures (whether at stated maturity, upon acceleration, upon maturity of any repurchase obligation or otherwise) upon such maturity of such principal amount of the Senior Subordinated Notes. Interest on the Senior Subordinated Notes is

computed on the basis of a 360-day year, consisting of twelve 30-day months. Each installment of interest will be calculated to accrue from and including the most recent date to which interest has been paid or provided for (or from and including the Issuance Date if no installment of interest has been paid) to, but not including, the date of payment.

Principal of, premium and Liquidated Damages, if any and interest on the Senior Subordinated Notes are payable at the office or agency of the Issuers maintained for such purpose within the City and State of New York or, at the option of the Issuers, payment of interest and Liquidated Damages, if any, may be made by check mailed to the holders of the Senior Subordinated Notes at their respective addresses set forth in the register of holders of Senior Subordinated Notes; provided that all payments of principal, premium and Liquidated Damages, if any and interest on the Senior Subordinated Notes the holders of which have given wire transfer instructions to the Issuers are required to be made by wire transfer of immediately available funds to the accounts specified by the holders thereof. Until otherwise designated by the Issuers, their office or agency in New York is the office of the Senior Subordinated Note Trustee maintained for such purpose. The Senior Subordinated Notes are issued in registered form, without coupons, and in denominations of $1,000 and integral multiples thereof.

Subordination

The payment of principal of, premium, if any, and interest on the Senior Subordinated Notes is subordinated in right of payment, as set forth in the Senior Subordinated Note Indenture, to the prior payment in full of all Senior Debt, whether outstanding on the date of the Senior Subordinated Note Indenture or thereafter incurred.

Upon any distribution to creditors of the Company or Venetian in a liquidation or dissolution of the Company or Venetian in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or Venetian or either of their property, an assignment for the benefit of creditors or any marshalling of the Company's or Venetian's assets and liabilities, the holders of Senior Debt will be entitled to receive payment in full of all Obligations due in respect of such Senior Debt (including interest after the commencement of any such proceeding at the rate specified in the applicable Senior Debt, whether or not allowed) before the Holders of Senior Subordinated Notes will be entitled to receive any payment with respect to the Senior Subordinated Notes, and until all Obligations with respect to Senior Debt are paid in full, any distribution to which the Holders of Senior Subordinated Notes would be entitled shall be made to the holders of Senior Debt (except that Holders of Senior Subordinated Notes may receive Permitted Junior Securities and payments made from the trust described under "--Legal Defeasance and Covenant Defeasance").

The Issuers also may not make any payment upon or in respect of the Senior Subordinated Notes (except in Permitted Junior Securities or from the trust described under "--Legal Defeasance and Covenant Defeasance") if (i) a default in the payment of the principal of, premium, if any, or interest on Designated Senior Debt occurs and is continuing beyond any applicable period of grace or
(ii) any other default occurs and is continuing with respect to Designated Senior Debt that permits holders of the Designated Senior Debt as to which such default relates to accelerate its maturity and the Senior Subordinated Note Trustee receives a notice of such default (a "Payment Blockage Notice") from the Company or the holders of any Designated Senior Debt. Payments on the Senior Subordinated Notes may and shall be resumed (a) in the case of a payment default, upon the date on which such default is cured or waived and (b) in case of a nonpayment default, the earlier of the date on which such nonpayment default is cured or waived or 179 days after the date on which the applicable Payment Blockage Notice is received, unless the maturity of any Designated Senior Debt has been accelerated. No new period of payment blockage may be commenced unless and until (i) 360 days have elapsed since the effectiveness of the immediately prior Payment Blockage Notice and (ii) all scheduled payments of principal, premium, if any, and interest on the Senior Subordinated Notes that have come due have been paid in full in cash. No nonpayment default that existed or was continuing on the date of delivery of any Payment Blockage Notice to the Senior Subordinated Note Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice unless such default shall have been waived for a period of not less than 180 days.

The Senior Subordinated Note Indenture further requires that the Issuers promptly notify holders of Senior Debt if payment of the Senior Subordinated Notes is accelerated because of an Event of Default.

As a result of the subordination provisions described above, in the event of a liquidation or insolvency, Holders of Senior Subordinated Notes may recover less ratably than creditors of the Issuers who are holders of Senior Debt. See "Risk Factors--Ranking of Senior Subordinated Notes; Subordination to Senior Debt; Limitations on Remedies."

Mandatory Redemption

The Issuers are not required to make mandatory redemptions or sinking fund payments prior to maturity with respect to the Senior Subordinated Notes.

Optional Redemption

Except as described below, the Senior Subordinated Notes are not redeemable at the option of the Issuers prior to November 15, 2001. On or after November 15, 2001, the Senior Subordinated Notes will be subject to redemption at the option of the Issuers, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the applicable redemption date, if redeemed during the twelve-month period beginning on November 15 of the years indicated below:

                                      Percentage
                                     of Principal
Year                                    Amount
----                                    ------
  2001 ............................     107.125%
  2002 ............................     103.563%
  2003 (and thereafter) ...........     100.000%

Notwithstanding the foregoing, on or prior to November 15, 2000, the Issuers may on any one or more occasions redeem up to 100% of the aggregate principal amount of Senior Subordinated Notes originally issued at a redemption price equal to (i) 114.25% of the Accreted Value of the Senior Subordinated Notes so redeemed (determined at the date of redemption) if prior to the second anniversary of the issuance date or (ii) 114.25% of the principal amount thereof if on or after the second anniversary of the issuance date, in each case, plus accrued and unpaid interest and Liquidated Damages, if any, thereon, to the redemption date, with the proceeds of one or more Public Equity Offerings; provided that such redemption shall occur within 60 days of the date of such Public Equity Offering.

In addition, at any time prior to November 15, 2001, the Issuers may, at their option, redeem the Senior Subordinated Notes, in whole or in part, at a redemption price equal to (i) 100% of the Accreted Value of the Senior Subordinated Notes so redeemed (determined at the date of redemption) if prior to the second anniversary of the issuance date or (ii) 100% of the principal amount of the Senior Subordinated Notes so redeemed if on or after the second anniversary of the issuance date, in each case, plus the Senior Subordinated Note Make-Whole Premium, plus, to the extent not included in the Senior Subordinated Note Make-Whole Premium, accrued and unpaid interest and Liquidated Damages, if any, to the date of redemption. For purposes of the foregoing, "Senior Subordinated Note Make-Whole Premium" means, with respect to a Senior Subordinated Note, an amount equal to the greater of (i) (a) 14.25% of the Accreted Value if prior to the second anniversary of the Issuance Date of such Senior Subordinated Note or (b) 14.25% of the outstanding principal amount if on or after the second anniversary of the Issuance Date of such Senior Subordinated Note and (ii) the excess of (a) the present value of the remaining interest, premium and principal payments due on such Senior Subordinated Note as if such Senior Subordinated Note were redeemed on November 15, 2001, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the outstanding principal amount of such Senior Subordinated Note.

Notwithstanding any other provision hereof, if any Gaming Authority requires that a holder or beneficial owner of the Senior Subordinated Notes must be licensed, qualified or found suitable under any applicable gaming laws in order to maintain any gaming license or franchise of the Company or any Restricted Subsidiary under any applicable gaming laws, and the holder or beneficial owner fails to apply for a license, qualification or finding of suitability within 30 days after being requested to do so by the Gaming Authority (or such lesser period that may be required by such Gaming Authority) or if such holder

or beneficial owner is not so licensed, qualified or found suitable, the Issuers shall have the right, at their option, (i) to require such holder or beneficial owner to dispose of such holder's or beneficial owner's Senior Subordinated Notes within 30 days of receipt of such finding by the applicable Gaming Authority (or such earlier date as may be required by the applicable Gaming Authority) or (ii) to call for redemption of the Senior Subordinated Notes of such holder or beneficial owner at a redemption price equal to the lesser of the principal amount thereof or the price at which such holder or beneficial owner acquired the Senior Subordinated Notes, together with, in either case, accrued and unpaid interest and Liquidated Damages, if any, to the earlier of the date of redemption or, the date of the finding of unsuitability by such Gaming Authority, which may be less than 30 days following the notice of redemption if so ordered by such Gaming Authority. In connection with any such redemption, and except as may be required by a Gaming Authority, the Issuers shall comply with the procedures contained in the Senior Subordinated Notes for redemptions of the Senior Subordinated Notes. Under the Senior Subordinated Note Indenture, the Issuers are not required to pay or reimburse any holder of the Senior Subordinated Notes or beneficial owner who is required to apply for such license, qualification or finding of suitability for the costs of the licensure or investigation for such qualification or finding of suitability. Such expenses will, therefore, be the obligation of such holder or beneficial owner. See "Regulation and Licensing."

Repurchase at the Option of Holders

Change of Control

Upon the occurrence of a Change of Control and subsequent to the consummation of any required repurchase of the Mortgage Notes pursuant to a Change of Control Offer under the terms of the Mortgage Note Indenture, the Issuers will make an offer to purchase all or any part (equal to $1,000 or an integral multiple thereof) of the Senior Subordinated Notes pursuant to the offer described below (the "Change of Control Offer") at a price in cash (the "Change of Control Payment") equal to (i) 101% of the Accreted Value (determined at the date of redemption) if prior to the second anniversary of the issuance date or (ii) 101% of the aggregate principal amount thereof, in each case, plus accrued and unpaid interest and Liquidated Damages, if any, to the date of repurchase. Within 30 days following any Change of Control, the Issuers will mail a notice to each holder stating the following: (1) a Change of Control is being made pursuant to the covenant entitled "Change of Control," and all Senior Subordinated Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment; (2) the purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed, except as may be otherwise required by applicable law (the "Change of Control Payment Date"); (3) any Senior Subordinated Note not properly tendered will remain outstanding and continue to accrue interest; (4) unless the Issuers default in the payment of the Change of Control Payment, all Senior Subordinated Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest and Liquidated Damages, if any, after the Change of Control Payment Date; (5) holders electing to have any Senior Subordinated Notes purchased pursuant to a Change of Control Offer will be required to surrender the Senior Subordinated Notes, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Senior Subordinated Notes completed, to the paying agent (which may be the Company or Venetian) specified in the notice at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date; (6) holders will be entitled to withdraw their tendered Senior Subordinated Notes and their election to require the Issuers to purchase the Senior Subordinated Notes, provided, that the paying agent receives, not later than the close of business on the last day of the Offer Period (as defined in the Senior Subordinated Note Indenture), a telegram, telex, facsimile transmission or letter setting forth the name of the holder, the principal amount of Senior Subordinated Notes tendered for purchase, and a statement that such holder is withdrawing his tendered Senior Subordinated Notes and his election to have such Senior Subordinated Notes purchased; and
(7) that holders whose Senior Subordinated Notes are being purchased only in part will be issued new Senior Subordinated Notes equal in principal amount to the unpurchased portion of the Senior Subordinated Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof.

The Issuers will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Senior Subordinated Notes pursuant to a Change of Control Offer.

On the Change of Control Payment Date, the Issuers will, to the extent permitted by law, (1) accept for payment all Senior Subordinated Notes or portions thereof properly tendered pursuant to the Change of Control Offer, (2) deposit with the paying agent an amount equal to the aggregate Change of Control Payment in respect of all Senior Subordinated Notes or portions thereof so tendered and (3) deliver, or cause to be delivered, to the Senior Subordinated Note Trustee for cancellation the Senior Subordinated Notes so accepted together with an Officers' Certificate stating that such Senior Subordinated Notes or portions thereof have been tendered to and purchased by the Issuers. The paying agent will promptly mail to each holder of Senior Subordinated Notes the Change of Control Payment for such Senior Subordinated Notes, and the Senior Subordinated Note Trustee will promptly authenticate and mail to each holder a new Senior Subordinated Note equal in principal amount to any unpurchased portion of the Senior Subordinated Notes surrendered, if any, provided, that each such new Senior Subordinated Note will be in a principal amount of $1,000 or an integral multiple thereof. The Issuers will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

The existence of a holder's right to require the Issuers to repurchase such holder's Senior Subordinated Notes upon the occurrence of a Change of Control may deter a third party from seeking to acquire either of the Issuers in a transaction that would constitute a Change of Control.

The source of funds for any repurchase of Senior Subordinated Notes upon a Change of Control will be cash generated from operations or other sources, including borrowings, sales of assets or sales of Capital Stock. However, there can be no assurance that sufficient funds will be available at the time of any Change of Control to make any required repurchases. Any failure by the Issuers to repurchase Senior Subordinated Notes tendered pursuant to a Change of Control Offer will be deemed an Event of Default.

The Bank Credit Facility, the Mall Construction Loan Facility and the Mortgage Note Indenture contain, and future agreements relating to the Issuers' Senior Debt may contain, restrictions or prohibitions on the Issuers' ability to repurchase the Senior Subordinated Notes. In the event that a Change of Control occurs at a time when the Issuers are prohibited from repurchasing the Senior Subordinated Notes, the Issuers could seek the consent of their lenders to purchase the Senior Subordinated Notes or could attempt to refinance the borrowings that contain such prohibition or restriction. If the Issuers do not obtain such consent or refinance such Indebtedness, they will remain prohibited or restricted from repurchasing the Senior Subordinated Notes. In such case, the Issuers' failure to repurchase the Senior Subordinated Notes tendered in the Change of Control Offer would constitute an Event of Default under the Senior Subordinated Note Indenture which would in turn constitute an event of default under the agreements governing the Issuers of the Senior Debt. In such circumstances, the subordination provisions of the Senior Subordinated Note Indenture would likely restrict payment to the holders of Senior Subordinated Notes. See "--Subordination" and "Description of Other Indebtedness."

The definition of Change of Control includes a phrase relating to the sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the assets of the Issuers and their Subsidiaries, taken as a whole. Although there is a developing body of case law interpreting the phrase "substantially all," there is no precisely established definition of the phrase under applicable law. Accordingly, the ability of a holder of Senior Subordinated Notes to require the Issuers to repurchase such Senior Subordinated Notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of the Issuers and their Subsidiaries taken as a whole to another Person or group may be uncertain.

Asset Sales

The Senior Subordinated Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to consummate an Asset Sale, unless (w) no Default or Event of Default exists or is continuing immediately prior to or after giving effect to such Asset Sale, (x) the Issuers or their Restricted Subsidiaries, as the case may be, receive consideration at the time of such Asset Sale at least equal to the fair market value (as determined by the Board of Directors and set forth in an Officers' Certificate delivered to the Senior Subordinated Note Trustee) of the assets sold or otherwise disposed of and (y) at least 85% of the consideration therefor received by either of the Issuers or any Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided, however, that the amount of (A) any liabilities (as shown on such Issuer's or such Restricted Subsidiary's, as the case may

be, most recent balance sheet or in the notes thereto) of the Issuers or any Restricted Subsidiary, as the case may be (other than liabilities that are by their terms expressly subordinated to the Senior Subordinated Notes or any Senior Subordinated Note Guaranty, which may be assumed only if such liabilities are deemed to be Restricted Payments in the case of the Issuer or any Restricted Subsidiary), that are assumed by the transferee of any such assets and (B) any notes, securities or other obligations received by the Company or any Restricted Subsidiary, as the case may be, from such transferee that are converted by the Issuers or such Restricted Subsidiary, as the case may be, into cash (to the extent of the cash received) within 20 Business Days following the closing of such Asset Sale, shall be deemed to be cash only for purposes of satisfying clause (y) of this paragraph and for no other purpose.

Within the later of (i) 180 days after any Issuer's or any Restricted Subsidiary's receipt of the Net Proceeds of any Asset Sale and (ii) if applicable, the consummation of any required repurchase of the Mortgage Notes pursuant to an Asset Sale Offer under the terms of the Mortgage Note Indenture, (the "Reinvestment Period"), such Issuer or such Restricted Subsidiary may apply the Net Proceeds from such Asset Sale (i) to permanently reduce Senior Debt (including by way of an Asset Offer pursuant to the Mortgage Note Indenture) or other Indebtedness that is not Subordinated Indebtedness, (ii) in an investment in any one or more business, capital expenditure or other tangible asset of the Issuers or any Restricted Subsidiary, in each case, engaged, used or useful in the Principal Business, or (iii) for working capital purposes in an amount not to exceed $20.0 million, in each case, with no concurrent obligation to make an offer to purchase any Senior Subordinated Notes. Pending the final application of any such Net Proceeds, such Issuer or such Restricted Subsidiary may temporarily reduce Senior Debt, if any, or otherwise invest such Net Proceeds in Cash Equivalents. Any Net Proceeds from the Asset Sale that are not invested or used to repay Indebtedness or as working capital (including by way of an Asset Sale Offer under the terms of the Mortgage Note Indenture) within the Reinvestment Period (including by way of an Asset Sale Offer under the terms of the Mortgage Note Indenture) as provided in the first sentence of this paragraph will be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Issuers shall, subject to any repayment obligations owed to the lenders under the Bank Credit Facility and the Mall Construction Lender as well as the holders of the Mortgage Notes, make an offer to all holders of Senior Subordinated Notes (an "Asset Sale Offer") to purchase the maximum principal amount of Senior Subordinated Notes, that is an integral multiple of $1,000, that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to (i) 101% of the Accreted Value (determined at the date of the redemption) if prior to the second anniversary of the issuance date or (ii) 101% of the aggregate principal amount thereof if on or after the second anniversary of the issuance date, in each case, plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Senior Subordinated Note Indenture. The Issuers will commence an Asset Sale Offer with respect to Excess Proceeds within 30 days after the date that Excess Proceeds exceeds $10.0 million by mailing the notice required pursuant to the terms of the Senior Subordinated Note Indenture. To the extent that the aggregate amount of Senior Subordinated Notes tendered pursuant to an Asset Sale Offer is less than the applicable Excess Proceeds, the Issuers may use any remaining Excess Proceeds for general corporate purposes or to offer to redeem Senior Subordinated Notes pursuant to the provisions of the Senior Subordinated Note Indenture described below under the caption "Description of Senior Subordinated Notes--Repurchase at the Option of the Holders--Asset Sales." If the aggregate principal amount of Senior Subordinated Notes surrendered by holders thereof exceeds the amount of Excess Proceeds, the Senior Subordinated Note Trustee shall select the Senior Subordinated Notes to be purchased in the manner described under the caption "Selection and Notice" below. Upon completion of any such Asset Sale Offer, the amount of Excess Proceeds shall be deemed reset at zero.

Selection and Notice

If less than all of the Senior Subordinated Notes are to be purchased in an Asset Sale Offer or redeemed at any time, selection of Senior Subordinated Notes for purchase or redemption will be made by the Senior Subordinated Note Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Senior Subordinated Notes are listed, or, if the Senior Subordinated Notes are not so listed, on a pro rata basis, by lot or by such other method as the Senior Subordinated Note Trustee shall deem fair and appropriate (and in such manner as complies with

applicable legal requirements); provided, that no Senior Subordinated Notes of $1,000 or less shall be purchased or redeemed in part.

Notices of purchase or redemption shall be mailed by first class mail, postage prepaid, at least 30 but not more than 60 days before the purchase or redemption date to each holder of Senior Subordinated Notes to be purchased or redeemed at such holder's registered address. Notices of redemption may not be conditional. If any Senior Subordinated Note is to be purchased or redeemed in part only, any notice of purchase or redemption that relates to such Senior Subordinated Note shall state the portion of the principal amount thereof that has been or is to be purchased or redeemed.

A new Senior Subordinated Note in principal amount equal to the unpurchased or unredeemed portion of any Senior Subordinated Note purchased or redeemed in part will be issued in the name of the holder thereof upon cancellation of the original Senior Subordinated Note. Senior Subordinated Notes called for redemption become due on the date fixed for redemption. On and after the purchase or redemption date (unless the Issuers default in payment of the purchase or redemption price), interest and Liquidated Damages, if any, shall cease to accrue on Senior Subordinated Notes or portions thereof purchased or called for redemption.

Certain Covenants

Gaming Licenses

The Senior Subordinated Note Indenture provides that the Issuers will use their best efforts to obtain and retain in full force and effect at all times all Gaming Licenses necessary for the operation of the Project.

Restricted Payments

The Senior Subordinated Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make any distribution on account of either of the Issuers' or any of their Restricted Subsidiaries' Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving either of the Issuers) or to the direct or indirect holders of either of the Issuers' Equity Interests in their capacity as such (other than (1) dividends or distributions by the Issuers payable in Equity Interests (other than Disqualified Stock) of the Issuers (or accretions thereon); or (2) dividends or distributions paid to the Issuers or a Wholly Owned Restricted Subsidiary of the Issuers); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving either of the Issuers) any Equity Interests of the Issuers or any of its Restricted Subsidiaries, or any other Affiliate of the Issuers (other than any such Equity Interests owned by the Issuers or any Wholly Owned Restricted Subsidiary of the Issuers); (iii) make any payment on or with respect to or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Indebtedness of the Issuers or any of their Restricted Subsidiaries (other than, in each case, scheduled interest and principal payments with respect to any such Subordinated Indebtedness);
(iv) make any payment in respect of repayment or reimbursement of amounts advanced under any obligation under the Completion Guaranty; or (v) make any Restricted Investment (all such payments and other actions set forth in clauses
(i) through (v) above being collectively referred to as "Restricted Payments"), unless, at the time of such Restricted Payment:

(a) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(b) the Issuers would, after giving pro forma effect to such Restricted Payment as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the first paragraph of the description of the covenant described under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock"; and

(c) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Issuers and their Restricted Subsidiaries after the Issuance Date (excluding Restricted Payments permitted by clauses
(ii), (iii), (v), (vi), (vii), (viii), (ix) (but only to the extent necessary under

clause (ix) to pay the fees and expenses of any lenders or agents under the Tranche A Take-out Commitment), (x), (xiii), (xiv), (xv) and (xvii) of the next succeeding paragraph and including the other Restricted Payments permitted by the next paragraph), is less than the sum of (X) 50% of (1) the Consolidated Net Income of the Company for the period (taken as one accounting period) from the first day after the Project is Completed to the end of the Company's most recently ended fiscal quarter for which internal financial statements are available (or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit) less (2) the amount paid or to be paid in respect of such period pursuant to clause (v) of the next following paragraph to shareholders or members other than the Issuers, plus (Y) without duplication, 100% of the aggregate net cash proceeds received by the Issuers since the Issuance Date from capital contributions or the issue or sale of Equity Interests (other than Disqualified Stock) or debt securities of the Issuers that have been converted into or exchanged for such Equity Interests of the Issuers (other than Equity Interests or such debt securities of the Issuers sold to a Restricted Subsidiary of the Issuers and other than Disqualified Stock or debt securities that have been converted into or exchanged for Disqualified Stock), plus (Z) to the extent not otherwise included in the Company's Consolidated Net Income, 100% of the cash dividends or distributions or the amount of the cash principal and interest payments received since the Issuance Date by the Issuers or any Restricted Subsidiary from any Unrestricted Subsidiary or Special Subsidiary or in respect of any Restricted Investment (other than dividends or distributions to pay obligations of or with respect to such Unrestricted Subsidiary or Special Subsidiary such as income taxes) until the entire amount of the Investment in such Unrestricted Subsidiary or Special Subsidiary has been received or the entire amount of such Restricted Investment has been returned, as the case may be, and 50% of such amounts thereafter. In the event that the Issuers convert an Unrestricted Subsidiary or Special Subsidiary to a Restricted Subsidiary, the Issuers may add back to this clause
(c) the aggregate amount of any Investment in such Subsidiary that was a Restricted Payment at the time of such Investment.

The foregoing provisions do not prohibit (i) the payment of any dividend within 60 days after the date of declaration thereof, if at the date of declaration such payment would have complied with the provisions of the Senior Subordinated Note Indenture; (ii) (a) an Investment in Phase II Subsidiary, Phase II Manager, Phase II Direct Holdings or any Special Subsidiary or (b) the redemption, repurchase, retirement or other acquisition of any Equity Interests of the Issuers or any Restricted Subsidiary, in each case, in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to a Restricted Subsidiary of the Issuers) of Equity Interests of the Issuers (other than any Disqualified Stock); provided that the amount of any net cash proceeds from the sale of such Equity Interests shall be excluded from clause (c)(Y) of the preceding paragraph; (iii) the defeasance, redemption, repurchase, retirement or other acquisition of any Subordinated Indebtedness of the Issuers or any Restricted Subsidiary in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to a Restricted Subsidiary of the Issuers) of Subordinated Indebtedness (other than any Subordinated Indebtedness issued in respect of the Completion Guaranty) of the Issuers or such Restricted Subsidiary or Equity Interests of the Issuers (other than Disqualified Stock); provided, however, that (1) the principal amount of such Subordinated Indebtedness incurred pursuant to this clause (iii) shall not exceed the principal amount of the Subordinated Indebtedness so redeemed, repurchased, retired or otherwise acquired (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (2) such Subordinated Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Subordinated Indebtedness being redeemed, repurchased, retired or otherwise acquired, (3) such Subordinated Indebtedness is pari passu with or subordinate in right of payment to the Senior Subordinated Notes and any Senior Subordinated Note Guaranty on terms at least as favorable to the holders of the Senior Subordinated Notes or the Senior Subordinated Note Guaranties as those contained in the documentation governing the Subordinated Indebtedness being redeemed, repurchased, retired or otherwise acquired and (4) the net cash proceeds from the sale of any Equity Interests issued pursuant to this clause
(iii) shall be excluded from clause (c)(Y) of the preceding paragraph; (iv) any redemption or purchase by the Issuers or any Restricted Subsidiary of Equity Interests or Subordinated Indebtedness of either of the Issuers required by a Gaming Authority in order to preserve a material Gaming License; provided, that so long as such efforts do not jeopardize any material Gaming License, the Issuers or such Restricted Subsidiary shall have diligently tried to find a third-party purchaser for such Equity Interests or Subordinated Indebtedness and no third-party purchaser acceptable to the

applicable Gaming Authority was willing to purchase such Equity Interests or Subordinated Indebtedness within a time period acceptable to such Gaming Authority; (v) (a) for so long as the Company is a corporation under Subchapter S of the Code or a substantially similarly treated pass-through entity or Venetian is a limited liability company that is treated as a partnership or a substantially similarly treated pass-through entity, in each case, for Federal income tax purposes (as evidenced by an opinion of counsel at least annually), the Issuers may each make cash distributions to their shareholders or members, during each Quarterly Payment Period, in an aggregate amount not to exceed the Permitted Quarterly Tax Distribution in respect of the related Estimation Period, and if any portion of the Permitted Quarterly Tax Distribution is not distributed during such Quarterly Payment Period, the Permitted Quarterly Tax Distribution payable during the immediately following four quarter period shall be increased by such undistributed portion and (b) distributions by non-Wholly Owned Subsidiaries of either of the Issuers or any Restricted Subsidiary of the Issuers but only to the extent required to pay any tax liability of such non- Wholly Owned Subsidiary; (vi) the transfer of the Mall Collateral to the Mall Subsidiary in accordance with the Sale and Contribution Agreement and the Disbursement Agreement and the transfer of 1% managing members interests in Mall Subsidiary and Mall Holdings to Mall Manager; (vii) the transfer of the Phase II Land to the Phase II Subsidiary and the transfer of 1% managing members interests in Phase II Subsidiary and Phase II Holdings to Phase II Manager; (viii) Investments by the Issuers in Supplier Joint Ventures in an amount not to exceed $10.0 million in the aggregate; (ix) Investments in any Special Subsidiary in an amount not to exceed $2.0 million in the aggregate (plus amounts necessary to fund the fees and expenses of the lenders or agents under the Tranche A Take-out Commitment), excluding for purposes of this clause
(ix) the value of any Restricted Payments under clauses (ii), (vii) or (xiv);
(x) intercompany payments, including without limitation, debt repayments, between or among the Issuers and their Wholly Owned Restricted Subsidiaries;
(xi) the repurchase of shares of, or options to purchase, common stock of either of the Issuers from employees, former employees, directors or former directors of either of the Issuers (or permitted transferees of such individuals), pursuant to the terms of the agreements (including employment agreements) or plans (or amendments thereto), in each case, as in effect on the date of the Mortgage Note Indenture and as approved by the board of directors of the Company under which such individuals purchase or sell, or are granted the option to purchase or sell, shares of such common stock ("Employee Stock Buybacks"); (xii) following an initial Public Equity Offering, dividends or common stock buybacks in an aggregate amount in any calendar year not to exceed 6% of the aggregate Net Proceeds received by either of the Issuers in connection with such initial Public Equity Offering and any subsequent Public Equity Offering; (xiii) repurchases of Capital Stock of either of the Issuers deemed to occur upon exercise of stock options if such Capital Stock represents a portion of the exercise price of such options; (xiv) cash contributions to a Special Subsidiary which are funded through a contribution (that does not constitute Disqualified Stock) by the Sole Stockholder or any of his Affiliates to either of the Issuers and any related Investment in any Special Subsidiary by either of the Issuers or any Restricted Subsidiary; provided that the amount of such contributions shall be excluded from clause (c)(Y) of the proceeding paragraph; (xv) contributions of cash, real property or other property to the Phase II Subsidiary, Phase II Holdings or Phase II Manager by the Sole Stockholder or any of his Affiliates through a contribution to either of the Issuers and any related Investment in the Phase II Subsidiary, Phase II Holdings or Phase II Manager by either of the Issuers or any Restricted Subsidiary; provided that the amount of such contributions shall be excluded from clause (c)(Y) of the proceeding paragraph; (xvi) the repayment of all or a portion of the Completion Guaranty Loan with Available Funds to the extent permitted by the terms of the Disbursement Agreement and the Completion Guaranty or, after Completion, with funds received by the Company as a result of judgments or settlements of claims under the Project Documents (including insurance policies and the Construction Management Contract); (xvii) on the Final Completion Date (as defined in the Disbursement Agreement), payments on the Completion Guaranty Loan from amounts which are returned to the Mall Construction Subsidiary from funds in the Mall Retainage/Punchlist Account (as defined in the Disbursement Agreement) in accordance with the Mall Escrow Agreement (as defined in the Disbursement Agreement); provided that such payments shall not be greater than all amounts previously deposited into the Mall Retainage/Punchlist Account from the Guaranty Deposit Account (as defined in the Disbursement Agreement); and (xviii) the repayment of the Substitute Tranche B Loan with the process of the Permitted Construction Loan Refinancing or the assumption of the Substitute Tranche B Loan by the Mall Subsidiary; provided, that at the time of, and after giving effect to,

any Restricted Payment permitted under clauses (ii) (b) (to the extent that any Equity Interests are redeemed, retired or acquired from the cash proceeds from the sale or issuance of Equity Interests), (iii) (to the extent that any Subordinated Indebtedness is defeased, redeemed, retired, repurchased or otherwise acquired from the cash proceeds from the sale or issuance of other Subordinated Indebtedness or Equity Interests), (viii), (ix), (xii), and (xvi), no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.

For purposes of determining the amount of Restricted Investments outstanding at any time, all Restricted Investments will be valued at their fair market value at the time made (as determined in good faith by the Company's Board of Directors), and no adjustments will be made for subsequent changes in fair market value.

Special Subsidiary Restricted Payments

The Senior Subordinated Note Indenture provides that a Special Subsidiary will not and will not permit any of its Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make any distribution on account of its Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving such Special Subsidiary or its Subsidiaries) (other than (1) dividends or distributions paid or made pro rata to all holders of Equity Interests of such Special Subsidiary or its Subsidiaries; (2) dividends or distributions by such Special Subsidiary payable in Equity Interests (other than Disqualified Stock) of such Special Subsidiary (or accretions thereon); or (3) dividends or distributions paid to such Special Subsidiary or a Wholly Owned Subsidiary of such Special Subsidiary by a Subsidiary of such Special Subsidiary); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving any Special Subsidiary or its Subsidiaries) any Equity Interests of any Special Subsidiary or any Subsidiary of any Special Subsidiary; or (iii) make any Special Subsidiary Restricted Investment (all such payments and other actions set forth in clauses (i) through (iii) above being collectively referred to as "Special Subsidiary Restricted Payments").

The foregoing provisions do not prohibit (i) the redemption, repurchase, retirement or other acquisition of any Equity Interests of any Special Subsidiary in exchange for, or out of the proceeds of, the substantially concurrent sale or issuance (other than to the Issuers or any Restricted Subsidiary of the Issuers) of Equity Interests of such Special Subsidiary and
(ii) the payment to or declaration or payment of any distribution or dividend to the Issuers and any of their Restricted Subsidiaries or the redemption, repurchase, retirement or other acquisition of any Equity Interests of any Special Subsidiary held by the Issuers or any Wholly Owned Restricted Subsidiary.

For purposes of determining the amount of Special Subsidiary Restricted Investments outstanding at any time, all Special Subsidiary Restricted Investments will be valued at their fair market value at the time made (as determined in good faith by the Company's Board of Directors), and no adjustments will be made for subsequent changes in fair market value.

In addition, after the transfer of the Mall Collateral to the Mall Subsidiary, the assets comprising the Mall Collateral may not be sold, leased or transferred to an Affiliate of the Issuers other than an Issuer, any Restricted Subsidiary or any Special Subsidiary that is a subsidiary of Mall Intermediate Holdings and in which the Sole Stockholder does not own any Equity Interests directly or indirectly, except through the Issuers.

Designation of Unrestricted Subsidiary

The Senior Subordinated Note Indenture provides that the Board of Directors of the Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided, that: (i) at the time of designation, the Investment by either of the Issuers and any of their Restricted Subsidiaries in such Subsidiary (other than Permitted Investments) shall be deemed a Restricted Investment (to the extent not previously included as a Restricted Investment) made on the date of such designation in the amount of the fair market value of such Investment as determined in good faith by the Board of Directors and, in the case of Investments in excess of $5.0 million, supported by a fairness opinion issued by an accounting, appraisal or investment banking firm of national standing; (ii) since the Issuance Date, such Unrestricted

Subsidiary has not acquired any assets from either of the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Senior Subordinated Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales"; (iii) at the time of designation, no Default or Event of Default has occurred and is continuing or results immediately after such designation or as a result of any Restricted Investment made in such Subsidiary at the time of such designation; (iv) at the time of designation, such Subsidiary has no Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (v) such Subsidiary does not own any Equity Interests in a Restricted Subsidiary; and (vi) such Subsidiary does not own or operate or possess any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or any material portion of the Project Assets of the Project.

A Subsidiary shall cease to be an Unrestricted Subsidiary and shall become a Restricted Subsidiary if either (i) at any time while it is a Subsidiary of the Company (1) such Subsidiary acquires any assets from the Company or any Restricted Subsidiary other than as permitted by the provisions of the Senior Subordinated Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales"; (2) such Subsidiary has any Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (3) such Subsidiary owns any Equity Interests in a Restricted Subsidiary of the Company; or (4) such Subsidiary owns or operates or possesses any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or (ii) the Board of Directors of the Company designates such Unrestricted Subsidiary to be a Restricted Subsidiary and no Default or Event of Default occurs or is continuing immediately after such designation.

As of the Issuance Date, each of Phase II Subsidiary, Phase II Manager and Phase II Holdings was designated an Unrestriced Subsidiary. Any future designation by the Board of Directors of the Company shall be evidenced to the Senior Subordinated Note Trustee by filing with the Senior Subordinated Note Trustee a certified copy of the resolutions of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions.

As of the Issuance Date, the Issuers had no Unrestricted Subsidiaries other than Phase II Subsidiary, Phase II Holdings and Phase II Manager. Under certain circumstances, as described above, the Company is able to designate future Subsidiaries as Unrestricted Subsidiaries. Unrestricted Subsidiaries are not subject to any of the restrictive covenants set forth in the Senior Subordinated Note Indenture and will not be Senior Subordinated Note Guarantors.

In addition, after the transfer of the Phase II Land to the Phase II Subsidiary, the Phase II Land may not be sold, leased or transferred to an Affiliate of the Issuers other than an Issuer, any Restricted Subsidiary or any Unrestricted Subsidiary that is a subsidiary of Phase II Intermediate Holdings and in which Person the Sole Stockholder does not own any Equity Interests, directly or indirectly, except through the Issuers.

Designation of Special Subsidiary

The Senior Subordinated Note Indenture provides that the Board of Directors of the Company may designate any Restricted Subsidiary to be a Special Subsidiary; provided, that: (i) at the time of designation, the Investment by either of the Issuers and any of their Restricted Subsidiaries in such Subsidiary (other than Permitted Investments) shall be deemed a Restricted Investment (to the extent not previously included as a Restricted Investment) made on the date of such designation in the amount of the fair market value of such Investment as determined in good faith by the Board of Directors of the Company and, in the case of Investments in excess of $5.0 million, supported by a fairness opinion issued by an accounting, appraisal or investment banking firm of national standing; (ii) since the Issuance Date, such Special Subsidiary has not acquired any assets from the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Senior Subordinated Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales";
(iii) at the time of designation, no Default or Event of Default has occurred and is continuing or results immediately after such designation or as a result of any Restricted Investment made in such Subsidiary at the time of such designation; (iv) at the time of designation, such Subsidiary

has no Indebtedness other than Non-Recourse Indebtedness of such Subsidiary;
(v) such Subsidiary does not own any Equity Interests in a Restricted Subsidiary; and (vi) such Subsidiary does not own or operate or possess any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or any material portion of the Project Assets of the Project.

A Subsidiary shall cease to be a Special Subsidiary and shall become a Restricted Subsidiary if either (i) at any time while it is a Subsidiary of the Issuers (1) such Subsidiary acquires any assets from the Issuers or any Restricted Subsidiary other than as permitted by the provisions of the Senior Subordinated Note Indenture, including the provisions described under the covenants entitled "Restricted Payments" and "Repurchase at the Option of Holders--Asset Sales"; (2) such Subsidiary has any Indebtedness other than Non-Recourse Indebtedness of such Subsidiary; (3) such Subsidiary owns any Equity Interests in a Restricted Subsidiary of the Issuers; or (4) such Subsidiary owns or operates or possesses any material license, franchise or right used in connection with the ownership or operation of any part of the Project Assets of the Project or (ii) the Issuers designate such Special Subsidiary to be a Restricted Subsidiary and no Default or Event of Default occurs or is continuing immediately after such designation.

Any such designation by the Board of Directors shall be evidenced to the Senior Subordinated Note Trustee by filing with the Senior Subordinated Note Trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions.

As of the Issuance Date, Mall Subsidiary, Mall Holdings and Mall Manager were each a Special Subsidiary. Under certain circumstances, as described above, the Company is able to designate certain Subsidiaries as Special Subsidiaries. Special Subsidiaries are not subject to all of the restrictive covenants set forth in the Senior Subordinated Note Indenture and will not be Senior Subordinated Note Guarantors.

Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock

The Senior Subordinated Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable with respect to (collectively, "incur" and correlatively, an "incurrence" of) any Indebtedness (including Acquired Indebtedness) or any shares of Disqualified Stock; provided, however, that the Issuers and their Restricted Subsidiaries may incur Indebtedness or issue shares of Disqualified Stock if (i) the Project is Completed and (ii) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of such incurrence would have been at least 2.0 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock had been issued, as the case may be, and application of proceeds had occurred at the beginning of such four-quarter period.

The foregoing limitations do not apply to:

(a) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness under the Bank Credit Facility in an aggregate principal amount not to exceed at any one time $170.0 million, less (i) the aggregate amount of all principal repayments and mandatory prepayments (other than repayments made under a revolving loan facility or prior to maturity in connection with a refinancing permitted under the Senior Subordinated Note Indenture) actually made from time to time after the date of the Senior Subordinated Note Indenture with respect to such Indebtedness, and (ii) permanent reductions resulting from the application of Asset Sale proceeds;

(b) the incurrence by the Issuers or any of their Restricted Subsidiaries of any Existing Indebtedness;

(c) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness represented by the Mortgage Notes, the Mortgage Note Guaranties, the Senior Subordinated Notes, the Senior Subordinated Note Guaranties and obligations arising under the Collateral Documents to the extent that such obligations would constitute Indebtedness;

(d) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness (the "Refinancing Indebtedness") issued in exchange for, or the proceeds of which are used to extend,

refinance, renew, replace, substitute or refund Indebtedness referred to in the first paragraph of this covenant or in clauses (b), (c), this clause (d), (g),
(h), (j) or (l); provided, however, that (1) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of Indebtedness (or, in the case of Indebtedness with original issue discount, the accreted value of such Indebtedness) so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (2) if the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded is subordinated in right of payment to the Senior Subordinated Notes Indenture, such Refinancing Indebtedness shall be subordinate in right and priority of payment to the Senior Subordinated Notes and any Senior Subordinated Note Guaranty on terms at least as favorable to the holders of Senior Subordinated Notes and the Senior Subordinated Note Guaranties as those contained in the documentation governing any Subordinated Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded and (3) the Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded;

(e) intercompany Indebtedness between or among the Issuers, any Senior Subordinated Note Guarantor and any Wholly Owned Restricted Subsidiary of the Issuers; provided, however, the obligations to pay principal, interest or other amounts under such intercompany Indebtedness is subordinated to the payment in full of the Senior Subordinated Notes and any Senior Subordinated Note Guaranties;

(f) Hedging Obligations that are incurred (1) for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of the Senior Subordinated Note Indenture to be outstanding or (2) for the purpose of fixing or hedging currency exchange rate risk with respect to any currency exchanges;

(g) the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness (which may include Capital Lease Obligations or purchase money obligations), incurred for the purpose of financing all or any part of the purchase or lease of personal property or equipment, including the Specified FF&E, used in the business of the Issuers or such Restricted Subsidiary, in an aggregate principal amount pursuant to this clause (g) (including any refinancings thereof pursuant to clause (d) above) not to exceed $100.0 million (plus accrued interest thereon and the amount of reasonable expenses incurred and premium paid in connection with any refinancing pursuant to clause (d) above) outstanding at any time;

(h) the incurrence by the Issuers or any of their Restricted Subsidiaries of Non-Recourse Financing used to finance the purchase or lease of personal or real property used in the business of the Issuers or such Restricted Subsidiary; provided, that (i) such Non-Recourse Financing represents at least 75% of the purchase price of such personal or real property; (ii) the Indebtedness incurred pursuant to this clause (h) (including any refinancings thereof pursuant to clause (d) above) shall not exceed $50.0 million (plus the amount of reasonable expenses incurred and premium paid in connection with any refinancing pursuant to clause (d) above) outstanding at any time; and (iii) no such Indebtedness may be incurred pursuant to this clause (h) unless the Project is Completed and the Company shall have generated at least $10.0 million of Consolidated Cash Flow in one fiscal quarter;

(i) to the extent that such incurrence does not result in the incurrence by the Issuers or any of their Restricted Subsidiaries of any obligation for the payment of borrowed money of others, Indebtedness incurred solely in respect of performance bonds, completion guarantees, standby letters of credit or bankers' acceptances; provided, that such Indebtedness was incurred in the ordinary course of business of the Issuers or any of their Restricted Subsidiaries and in an aggregate principal amount outstanding under this clause
(i) at any one time of less than $20.0 million;

(j) the incurrence by the Issuers or any of their Restricted Subsidiaries of Subordinated Indebtedness thereon to the Sole Stockholder pursuant to an advance under the Completion Guaranty in an aggregate amount not to exceed $25.0 million plus accrued interest thereon; provided that such Subordinated Indebtedness has a Weighted Average Life to Maturity greater than the Senior Subordinated Notes and is by its terms subordinated to the Mortgage Notes and the Senior Subordinated Notes;

(k) the incurrence by the Issuers of up to $140.0 million of Indebtedness represented by the Mall Construction Loan Facility;

(l) the incurrence by the Issuers of Indebtedness represented by the Substitute Tranche B Loan plus accrued interest thereon; provided that such Indebtedness has a Weighted Average Life to Maturity greater than the Senior Subordinated Notes and is by its terms subordinated to the Mortgage Notes;

(m) the incurrence by the Issuers of unsecured Indebtedness (subordinated in right of payment to the Senior Subordinated Notes) issued in connection with the Employee Stock Buybacks permitted under clause (xi) of the covenant described above under the caption "--Restricted Payments";

(n) the incurrence by the Issuers or any Restricted Subsidiary of (A)(i) at any time prior to Completion, additional Indebtedness under clause (a) or
(k) in an aggregate amount not to exceed $20.0 million, plus (ii) after a default under the Disbursement Agreement and at any time prior to Completion, additional Indebtedness under clause (a) or (k) in an aggregate amount not to exceed $30.0 million (provided that Indebtedness incurred pursuant to this clause (n)(A)(ii) is matched, dollar for dollar, by additional equity investments by the Sole Stockholder or an Affiliate of the Sole Stockholder), in the case of each of clause (A)(i) and (A)(ii), incurred in accordance with the Intercreditor Agreement and (B) after Completion, additional Indebtedness in an aggregate amount at any time outstanding not to exceed $25.0 million (less any amounts incurred pursuant to clause (n)(A) above that remain outstanding after Completion); and

(o) after Completion, the incurrence by the Issuers or any of their Restricted Subsidiaries of Indebtedness under any Working Capital Facility in an aggregate amount at any time outstanding not to exceed $20.0 million;

(p) the incurrence by the Issuers of Indebtedness incurred for the purpose of financing all or any part of the purchase or lease of gaming equipment to be used in connection with the casino located at the casino resort to be owned by Phase II Subsidiary or any casino operated pursuant to an Other Phase II Agreement in an aggregate amount at any time outstanding not to exceed $10.0 million; provided, that upon default under such Indebtedness, the lender under such Indebtedness may seek recourse or payment against the Issuers only through the return or sale of the property or equipment so purchased or leased and may not otherwise assert a valid claim for payment on such Indebtedness against the Issuers or any other property of the Issuers; and

(q) the guaranty by the Issuers or a Restricted Subsidiary of Indebtedness of the Issuers or a Restricted Subsidiary that was permitted to be incurred by another provision of this covenant.

The Senior Subordinated Note Indenture provides that the Issuers will not permit any of their Unrestricted Subsidiaries or Special Subsidiaries to incur any Indebtedness (including Acquired Indebtedness) or issue any shares of Disqualified Stock, other than Non-Recourse Indebtedness; provided, however, that if any such Unrestricted Subsidiary or Special Subsidiary ceases to remain an Unrestricted Subsidiary or Special Subsidiary, such event shall be deemed to constitute the incurrence of the Indebtedness in such Subsidiary by a Restricted Subsidiary. For a discussion of the Issuers' ability to incur additional Indebtedness, see "Description of Intercreditor Agreement."

For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness permitted in clauses (a) through (q) above or is entitled to be incurred pursuant to the first paragraph of this covenant, the Issuers shall, in their sole discretion, classify such item of Indebtedness in any manner that complies with this covenant and such item of Indebtedness will be treated as having been incurred pursuant to only such clause or clauses or pursuant to the first paragraph hereof. Accrual of interest, the accretion of accreted value or principal and the payment of interest in the form of additional Indebtedness is not deemed to be an incurrence of Indebtedness for purposes of this covenant.

Upon any refinancing or replacement of the Bank Credit Facility with a lender that does not become party to the Intercreditor Agreement, the Trustee shall enter into an intercreditor agreement with such lender with terms that are no less favorable to the Senior Subordinated Note Trustee or the Holders of Senior Subordinated Notes than those contained in the Intercreditor Agreement.

Liens

The Senior Subordinated Note Indenture will provide that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly create, incur, assume or suffer to exist any Lien

on any asset owned as of the Issuance Date or thereafter acquired by the Issuers or any such Restricted Subsidiary, or any income or profits therefrom, or assign or convey any right to receive income therefrom, except, in each case, Permitted Liens.

Merger, Consolidation, or Sale of Assets

The Senior Subordinated Note Indenture provides that neither of the Issuers shall consolidate or merge with or into or wind up into (whether or not such entity is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person unless (i) the Company or Venetian, as the case may be, is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than the Company or Venetian) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof; (ii) the Person formed by or surviving any such consolidation or merger (if other than the Company or Venetian) or the Person to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made assumes all the obligations of the Company or Venetian, as the case may be, under the Senior Subordinated Note Indenture pursuant to a supplemental indenture or other documents or instruments in form reasonably satisfactory to the Senior Subordinated Note Trustee under the Senior Subordinated Notes and the Senior Subordinated Note Indenture; (iii) immediately after such transaction no Default or Event of Default exists; (iv) such transaction will not result in the loss or suspension or material impairment of any material Gaming License; (v) the Company, Venetian or any Person formed by or surviving any such consolidation or merger, or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made (A) will have Consolidated Net Worth (immediately after the transaction but prior to any purchase accounting adjustments resulting from the transaction) equal to or greater than the Consolidated Net Worth of the Company or Venetian immediately preceding the transaction and (B) will, at the time of such transaction and after giving pro forma effect thereto as if such transaction had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock"; and (vi) such transactions would not require any holder of Senior Subordinated Notes (other than any Person acquiring the Company or Venetian or their assets and any Affiliate thereof) to obtain a gaming license or be qualified under the law of any applicable gaming jurisdiction; provided that such holder would not have been required to obtain a gaming license or be qualified under the laws of any applicable gaming jurisdiction in the absence of such transactions. Notwithstanding anything to the contrary, the Issuers may consolidate or merge with or wind up into each other without meeting the requirements set forth in clause (v) above.

Transactions with Affiliates

The Senior Subordinated Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries or Special Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into any contract, agreement, understanding, loan, advance or guaranty with, or for the benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless (a) such Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary or Special Subsidiary with an unrelated Person and (b) the Company delivers to the Senior Subordinated Note Trustee (i) with respect to any Affiliate Transaction involving aggregate payments in excess of (A) $500,000, an Officers' Certificate certifying that such Affiliate Transaction complies with clause (a) above, or (B) $1.0 million, a resolution adopted by a majority of the disinterested non-employee directors of the Board of Directors approving such Affiliate Transaction and set forth in an Officers' Certificate certifying that such Affiliate Transaction complies with clause (a) above and (ii) with respect to any Affiliate Transaction that is a loan transaction involving a principal amount in excess of $10.0 million or any other type of Affiliate Transaction involving aggregate payments in excess of $10.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary or Special Subsidiary from a financial point of view issued by an Independent Financial Advisor. The foregoing provisions do not apply to the following: (f) rental payments from Mall Subsidiary to Venetian under the Billboard Lease, as in effect on the date of

the Senior Subordinated Note Indenture; (g) the lease agreement relating to a restaurant to be operated by Wolfgang Puck and currently contemplated to be known as "Oba Chine" restaurant on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained with an unrelated Person; (h) the Services Agreement, as in effect on the date of the Senior Subordinated Note Indenture;
(i) the Other Phase II Agreements on terms that are no less favorable to the Company or the relevant Restricted Subsidiary or Special Subsidiary than those that would have been obtained with an unrelated Person; (j) purchases of materials or services from a Joint Venture Supplier by the Issuers or any of their Restricted Subsidiaries or Special Subsidiaries in the ordinary course of business on arm's length terms; (k) any employment, indemnification, noncompetition or confidentiality agreement entered into by either of the Issuers or any of their Restricted Subsidiaries or Special Subsidiaries with their employees or directors in the ordinary course of business (other than an employment agreement with the Sole Stockholder); (l) loans or advances to employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries (i) to fund the exercise price of options granted under employment agreements or the Issuers' stock option plans or agreements, in each case, as in effect on the date of the Mortgage Note Indenture or (ii) for any other purpose not to exceed $2.0 million in the aggregate outstanding at any one time; (m) the payment of reasonable fees to directors of the Issuers and their Restricted Subsidiaries and Special Subsidiaries who are not employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries; (n) the grant of stock options or similar rights to employees and directors of either of the Issuers pursuant to agreements or plans approved by the Board of Directors of the Company or the managing member of Venetian and any repurchases of stock options of the Issuers from such employees to the extent provided for in such plans or agreements or permitted under the covenant described above under the caption "--Restricted Payments"; (o) transactions between or among the Issuers and/or any of their Restricted Subsidiaries or transactions between or among the Special Subsidiaries and/or any Wholly-Owned Subsidiary of Special Subsidiaries; (p) with respect to the Issuers and any Restricted Subsidiary, Restricted Payments permitted by the provisions of the Senior Subordinated Note Indenture described above under the caption "Restricted Payments" and with respect to any Special Subsidiary, Special Subsidiary Restricted Payments permitted by the provisions of the Senior Subordinated Note Indenture described above under the caption "Special Subsidiary Restricted Payments"; (q) purchases of Equity Interests of the Issuers (other than Disqualified Stock) by any stockholder or member of the Issuers (or an Affiliate of a stockholder or member of the Issuers); (r) the Completion Guaranty and related Completion Guaranty Loan; (s) the transactions contemplated by the Cooperation Agreement, the Mall Lease, the Sale and Contribution Agreement and the HVAC Services Agreement, in each case, as in effect on the Issuance Date; (t) the use of the Congress Center by an Affiliate of the Issuers; provided that Venetian receives fair market value for the use of such property, as determined in the reasonable discretion of the Board of Directors of the Company; (u) the transactions contemplated in "Certain Transactions--Temporary Lease," "--Retirement Plan" and "--Airplane Expenses"; (v) transactions relating to the Permitted Construction Loan Refinancing, including the Tranche B Take-out Commitment and the guaranty by the Sole Stockholder of the loan to be made under the Tranche A Take-out Commitment; (w) transactions relating to the guaranty of Tranche B Loan of the Mall Construction Loan Facility by the Sole Stockholder, including the making of Substitute Tranche B Loan; (x) the transfer of the Phase II Land to the Phase II Subsidiary and, upon Completion and in accordance with the Sale and Construction Agreement, the transfer of the Mall Collateral to the Mall Subsidiary; and (y) the Company or Venetian may enter into and perform their obligations under a gaming operations lease or management agreement with Phase II Subsidiary relating to the casino to be operated in the casino resort owned by the Phase II Subsidiary on terms substantially similar to those of the Casino Lease, except that (i) the rent payable to the Phase II Subsidiary under such lease shall be equal to all revenue derived from such casino minus the sum of (1) the operating costs related to such casino (including an allocated portion (based on gaming revenue) of the Company's or Venetian's, as the case may be, administrative costs related to its gaming operations) and (2) the lesser of $250,000 or 1.0% of such casino's operating income (or zero if there is an operating loss) (determined in accordance with generally accepted accounting principles), (ii) the Company or Venetian, as the case may be, may agree that they shall operate the casino in the resort owned by the Phase II Subsidiary and the Casino in the

Project in substantially similar manners and (iii) the Company or Venetian, as the case may be, may agree to have common gaming and surveillance operations in such casinos (based on equal allocations of revenues and operating costs).

No Senior Subordinated Debt

Subject to the Indebtedness described in the next sentence, the Senior Subordinated Note Indenture provides that the Issuers will not incur, create, issue, assume, guarantee or otherwise become liable for any Indebtedness that is subordinate or junior in right of payment to any Senior Debt and senior in any respect in right of payment to the Senior Subordinated Notes. The Intercreditor Agreement provides that up to $30.0 million of additional Indebtedness that may be junior in right of payment to any Senior Debt and senior in right of payment to the Senior Subordinated Notes may be incurred by the Issuers, if among other things, a majority of the outstanding principal amount of the Senior Subordinated Notes consent to such issuance. See "Description of Intercreditor Agreement."

Dividend and Other Payment Restrictions Affecting Subsidiaries

The Senior Subordinated Note Indenture provides that the Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual restriction on the ability of any such Restricted Subsidiary (other than Venetian) to (a) (i) pay dividends or make any other distributions to the Issuers or any of their Restricted Subsidiaries (A) on their Capital Stock or (B) with respect to any other interest or participation in, or measured by, its profits, or (ii) pay any Indebtedness owed to the Issuers or any of their Restricted Subsidiaries (other than in respect of the subordination of such Indebtedness to the Senior Subordinated Notes, the Senior Subordinated Note Guarantees or any other Indebtedness incurred pursuant to the terms of the Senior Subordinated Note Indenture, as the case may be), (b) make loans or advances to the Issuers or any of their Restricted Subsidiaries or (c) sell, lease, or transfer any of their properties or assets to the Issuers or any of their Restricted Subsidiaries, except (in each case) for such encumbrances or restrictions existing under or by reason of
(1) contractual encumbrances or restrictions in effect on the Issuance Date,
(2) the Bank Credit Facility (and any related security agreements), the Mortgage Note Indenture, the Mortgage Notes, the Mall Construction Loan Facility (and any related security agreements), any Mortgage Note Guaranties, indebtedness incurred pursuant to clause (g), (h), (j), (l), (n) or (o) of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" and the Collateral Documents,
(3) the Senior Subordinated Note Indenture, the Senior Subordinated Notes and the Senior Subordinated Note Guaranties, (4) any instrument governing Indebtedness or Capital Stock of a Person acquired by, the Company or any Restricted Subsidiary as in effect at the time of such acquisition (except to the extent such Indebtedness was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that the Consolidated Cash Flow of such Person is not taken into account in determining whether such acquisition was permitted by the terms of the Senior Subordinated Note Indenture, (5) by reason of customary non-assignment provisions in leases entered into in the ordinary course of business and consistent with past practices and any leases permitted by the provisions of the covenant entitled "Restrictions on Leasing and Dedication of Property," (6) purchase money obligations for property acquired in the ordinary course of business that impose restrictions of the nature discussed in clause (c) above on the property so acquired, (6) applicable law or any applicable rule or order of any Gaming Authority, (7) Permitted Liens, (8) customary restrictions imposed by asset sale or stock purchase agreements relating to the sale of assets or stock by the Issuers or any Restricted Subsidiary, or (9) any encumbrances or restrictions imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (8) above, provided, that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Company's Board of Directors, no more restrictive with respect to such dividend and other payment restrictions than those contained in the dividend or other payment restrictions prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

Line of Business

The Senior Subordinated Note Indenture provides that for so long as any Senior Subordinated Notes are outstanding, the Issuers shall not, and shall not permit any of their Restricted Subsidiaries or Special Subsidiaries to, engage in any business or activity other than, (i) with respect to the Issuers and their Restricted Subsidiaries, the Principal Business, and (ii) with respect to any Special Subsidiary, the Special Subsidiary Principal Business, except, in each case, to such extent as would not be material to (a) the Issuers and their Subsidiaries taken as a whole or (b) the Special Subsidiary, respectively.

Limitation on Status as Investment Company

The Senior Subordinated Note Indenture prohibits the Issuers and their Restricted Subsidiaries from being required to register as an "investment company" (as that term is defined in the Investment Company Act of 1940, as amended).

Ownership of Unrestricted Subsidiaries and Special Subsidiaries

The Senior Subordinated Note Indenture provides that, at all times from the Issuance Date until all of the Capital Stock of the Phase II Subsidiary or the Mall Subsidiary is sold or otherwise disposed of to any Person other than an Affiliate of the Issuers, one of the Issuers will directly or indirectly own
(i) at least a majority of the issued and outstanding Capital Stock of Phase II Subsidiary (which is an Unrestricted Subsidiary) and (ii) at least 80% of the issued and outstanding Capital Stock of Mall Subsidiary (which is a Special Subsidiary); provided that the Sole Stockholder or any of his Affiliates (other than the Issuers or any of their Wholly-Owned Restricted Subsidiaries) will not purchase or otherwise acquire, directly or indirectly, any of the Capital Stock of the Phase II Subsidiary, Mall Subsidiary or any of their respective Subsidiaries.

Limitation on Phase II Construction

The Senior Subordinated Note Indenture provides that the Issuers shall not, and shall not permit any of their Subsidiaries (including Unrestricted Subsidiaries and Special Subsidiaries), at any time prior to receipt by the Issuers or any such Subsidiary of a temporary certificate of occupancy from Clark County, Nevada with respect to the Project (as currently defined) (a) to construct, develop or improve the Phase II Land or any building on the Phase II Land (including any excavation or site work and excluding the proposed Phase II parking garage), (b) enter into any contract or agreement for such construction, development or improvement, or for any materials, supplies or labor necessary in connection with such construction, development or improvement (other than a contract or agreement that is conditional upon satisfaction of the above condition) or (c) incur any Indebtedness the proceeds of which are expected to be used for the construction, development or improvement of the Phase II Land or any building on the Phase II Land, except
(i) any construction, development or improvement on the Phase II Land or any temporary building on the Phase II Land in connection with the Project in accordance with the Plans and Specifications and included in the Project Budget; and (ii) any design, architectural, engineering or development work not involving actual construction on the Phase II Land.

Senior Subordinated Note Guaranties

The Issuers' obligations under the Senior Subordinated Notes and the Senior Subordinated Note Indenture are jointly, severally and unconditionally guaranteed by the Senior Subordinated Note Guarantors. The Senior Subordinated Note Guaranties are subordinated to the prior payment in full of all Senior Debt of each Senior Subordinated Note Guarantor (including such Senior Subordinated Note Guarantor's guaranty of the Bank Credit Facility) to the same extent that the Senior Subordinated Notes are subordinated to Senior Debt of the Issuers. As of the Issuance Date, each existing Restricted Subsidiary and any future Restricted Subsidiary was a Senior Subordinated Note Guarantor. The obligations of each Senior Subordinated Note Guarantor under its Senior Subordinated Note Guaranty is limited to the extent necessary under any applicable corporate law to ensure it does not constitute a fraudulent conveyance under applicable law.

Except in the event of a disposition of all or substantially all of the assets of a Senior Subordinated Note Guarantor by way of merger or consolidation, the Senior Subordinated Note Indenture provides that

no Senior Subordinated Note Guarantor shall consolidate with or merge with or into (whether or not such Senior Subordinated Note Guarantor is the surviving Person), another Person, whether or not affiliated with such Senior Subordinated Note Guarantor, unless (i) subject to the provisions of the following paragraph and certain other provisions of the Senior Subordinated Note Indenture, the Person formed by or surviving any such consolidation or merger (if other than such Senior Subordinated Note Guarantor) assumes all the obligations of such Senior Subordinated Note Guarantor pursuant to a supplemental indenture in form reasonably satisfactory to the Senior Subordinated Note Trustee pursuant to which such Person shall unconditionally guarantee, on a subordinated basis, all of such Senior Subordinated Note Guarantor's obligations under such Senior Subordinated Note Guaranty and the Senior Subordinated Note Indenture; (ii) immediately after giving effect to such transaction, no Default or Event of Default exists; (iii) such transaction will not result in the loss or suspension or material impairment of any material Gaming License; and (iv) the Company (A) will have Consolidated Net Worth (immediately after giving effect to such transaction), equal to or greater than the Consolidated Net Worth of the Company immediately preceding the transaction and (B) will be permitted by virtue of its pro forma Fixed Charge Coverage Ratio to incur, immediately after giving effect to such transaction, at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock." Notwithstanding anything herein to the contrary, a Wholly Owned Restricted Subsidiary of the Issuers that is a Senior Subordinated Note Guarantor may consolidate or merge with, or sell or otherwise dispose of all or substantially all of its assets to, one of the Issuers or another Wholly Owned Restricted Subsidiary of the Issuers that is a Senior Subordinated Note Guarantor.

The Senior Subordinated Note Indenture provides that in the event of (i) a sale or other disposition of all or substantially all of the assets of any Senior Subordinated Note Guarantor, by way of merger, consolidation or otherwise, (ii) a Restricted Subsidiary becoming an Unrestricted Subsidiary or a Special Subsidiary pursuant to terms of the Senior Subordinated Note Indenture or (iii) a sale or other disposition of all of the Capital Stock of any Senior Subordinated Note Guarantor that is a Subsidiary, then such Senior Subordinated Note Guarantor (in the event of a sale or other disposition, by way of such a merger, consolidation or otherwise, of all of the Capital Stock of such Senior Subordinated Note Guarantor or the Restricted Subsidiary becoming an Unrestricted Subsidiary or a Special Subsidiary pursuant to the terms of the Senior Subordinated Note Indenture) or the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Senior Subordinated Note Guarantor) shall be released and relieved of any obligations under its Senior Subordinated Note Guaranty; provided that (i) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof and (ii) the Net Proceeds of such sale or other disposition are applied in accordance with the applicable provisions of the Senior Subordinated Note Indenture. See "--Repurchase at Option of Holders--Asset Sales."

The Senior Subordinated Note Indenture provides that if (a) either of the Issuers or any Restricted Subsidiary transfers or causes to be transferred, in one or a series of related transactions (other than a transaction or series of related transactions constituting a Restricted Payment permitted pursuant to the provisions of the Senior Subordinated Note Indenture described above under the caption "Restricted Payments"), property or assets having a fair market value exceeding $1.0 million to any Restricted Subsidiary of the Issuers (other than a Senior Subordinated Note Guarantor), (b) any Restricted Subsidiary that is not a Senior Subordinated Note Guarantor shall have a net worth, annual revenues or net income in excess of $1.0 million (including by reason of acquisition, consolidation or merger) or shall own any material license, franchise or right used in the operation of any of the Project Assets of the Project or (c) an Unrestricted Subsidiary or Special Subsidiary ceases to be an Unrestricted Subsidiary or Special Subsidiary, as the case may be, pursuant to the terms of the Senior Subordinated Note Indenture or is designated by the Board of Directors to be a Restricted Subsidiary pursuant to the terms of the Senior Subordinated Note Indenture and, in each case such Restricted Subsidiary shall have a net worth, annual revenues or net income in excess of $1.0 million (including by reason of acquisition, consolidation or merger) or shall own any material license, franchise or right used in the operation of any of the Project Assets of the Project, the Issuers shall cause such Restricted Subsidiary to (i) execute and deliver to the Senior Subordinated Note Trustee a supplemental indenture in form reasonably satisfactory to the Senior Subordinated Note Trustee pursuant to which such Restricted Subsidiary shall unconditionally guarantee,

on a subordinated basis, all of the Issuers obligations under the Senior Subordinated Notes and the Senior Subordinated Note Indenture on the terms set forth in the Senior Subordinated Note Indenture and (ii) deliver to the Senior Subordinated Note Trustee an opinion of counsel that, subject to customary assumptions and exclusions, such supplemental indenture has been duly executed and delivered by such Restricted Subsidiary.

Reports

Under the terms of the Senior Subordinated Note Indenture, the Company will file with the Senior Subordinated Note Trustee and provide holders of Senior Subordinated Notes, within 15 days after it files them with the Commission, copies of its annual report and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may by rule or regulation prescribe) which the Company is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that the Company may not be required to remain subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the Commission, the Senior Subordinated Note Indenture requires the Company to continue to file with the Commission and provide the Senior Subordinated Note Trustee and each holder with, without cost to each holder, (a) within 90 days after the end of each fiscal year, annual reports on Form 10-K (or any successor form) containing the information required to be contained therein (or required in such successor form); (b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year, reports on Form 10-Q (or any successor form); and (c) promptly from time to time after the occurrence of an event required to be therein reported, such other reports on Form 8-K (or any successor form) containing the information required to be contained therein (or required in any successor form); provided, however, that the Company shall not be so obligated to file such reports with the Commission if the Commission does not permit such filings. Notwithstanding the foregoing, if any Person that, directly or indirectly, owns more than 50% of the common equity of the Company is subject to the periodic reporting and the informational requirements of the Exchange Act, the Company will not be required to file the reports specified in the preceding sentence so long as it provides annual and quarterly financial statements of the Company (which will include summarized financial information concerning Venetian) to the holders of the Senior Subordinated Notes. The Company will in all cases, without cost to each recipient, provide copies of such information to the holders of the Senior Subordinated Notes and, if it is not permitted to file such reports with the Commission, shall make available such information to prospective purchasers and to securities analysts and broker-dealers upon their request. In addition, the Company has agreed that, for so long as any Senior Subordinated Notes remain outstanding, it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Not later than the date of filing any quarterly or annual report, the Company shall deliver to the Senior Subordinated Note Trustee an Officers' Certificate stating that each Restricted Payment made in the prior fiscal quarter was permitted and setting forth the basis upon which the calculations required by the covenant relating to "Restricted Payments" were computed, which calculations may be based upon the Company's latest available financial statements at the time of such Restricted Payment.

Events of Default and Remedies

The Senior Subordinated Note Indenture provides that each of the following constitutes an Event of Default: (i) default in payment when due and payable, upon redemption or otherwise, of principal or premium, if any, on the Senior Subordinated Notes or under any Senior Subordinated Note Guaranty; (ii) default for 30 days or more in the payment when due of interest on, or Liquidated Damages, if any, with respect to the Senior Subordinated Notes or under any Senior Subordinated Note Guaranty; (iii) failure by the Issuers or any Senior Subordinated Note Guarantor to offer to purchase or to purchase the Senior Subordinated Notes, in each case when required under an offer made pursuant to the provisions of the Senior Subordinated Note Indenture; (iv) failure by (a) the Issuers or any Senior Subordinated Note Guarantor to comply with the provisions described under the captions "Restricted Payments" or limitations on "Incurrence of Indebtedness and Issuance of Disqualified Stock" or (b) any Special Subsidiary to comply with the provisions described under the caption "Special Subsidiary Restricted Payments"; (v)

failure by the Issuers or any Senior Subordinated Note Guarantor for 45 days after receipt of written notice from the Senior Subordinated Note Trustee to comply with any of its other agreements in the Senior Subordinated Note Indenture, the Senior Subordinated Notes or the Senior Subordinated Note Guaranties; (vi) default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed by the Issuers, or any of their Restricted Subsidiaries or any Special Subsidiary or the payment of which is guaranteed by the Issuers, or any of their Restricted Subsidiaries or any Special Subsidiary, whether such Indebtedness or guarantee now exists or is created after the Issuance Date, which default (a) in the case of the Issuers or any of their Restricted Subsidiaries only, is caused by a failure to pay when due at final maturity (giving effect to any grace period or waiver related thereto) the principal of such Indebtedness (a "Payment Default") or (b) results in the acceleration of such Indebtedness prior to its express maturity and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which a Payment Default then exists or with respect to which the maturity thereof has been so accelerated or which has not been paid at maturity, aggregates $10 million or more; (vii) failure by the Issuers, any of their Restricted Subsidiaries to pay final judgments aggregating in excess of $10 million, which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days;
(viii) the repudiation by the Issuers or any of their Subsidiaries of its obligations under, or any judgment or decree by a court or governmental agency of competent jurisdiction declaring the unenforceability of, any Senior Subordinated Note Guarantee for any reason that, in each case, would materially and adversely impair the benefits to the Senior Subordinated Note Trustee or the holders of the Senior Subordinated Notes thereunder; (ix) certain events of bankruptcy or insolvency with respect to the Issuers, any Special Subsidiary or any Senior Subordinated Note Guarantor that is a Significant Subsidiary of the Issuers or any group of Senior Subordinated Note Guarantors that together would constitute a Significant Subsidiary of the Issuers; (x) after the Project becomes Completed, revocation, termination, suspension or other cessation of effectiveness of any Gaming License, which results in the cessation or suspension of gaming operations for a period of more than 90 consecutive days at the Project; (xi) the Project is not Completed by the Outside Completion Deadline and continues to be not Completed; or (xii) failure by Interface to comply with its obligations under the Cooperation Agreement with respect to a change of control of Interface or a sale, transfer or other disposition by Interface of its interest in the Expo Center or the incurrence by Interface of Indebtedness.

Subject to the provisions of the Intercreditor Agreement, if any Event of Default (other than by reason of bankruptcy or insolvency) occurs and is continuing, the Senior Subordinated Note Trustee or the holders of at least 25% in principal amount of the then outstanding Senior Subordinated Notes may declare the principal, premium and Liquidated Damages, if any, interest and any other monetary obligations on all the Senior Subordinated Notes to be due and payable immediately. See "Description of Intercreditor Agreement." Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to the Issuers, or any Senior Subordinated Note Guarantor that is a Significant Subsidiary, all outstanding Senior Subordinated Notes will become due and payable without further action or notice. Holders of the Senior Subordinated Notes may not enforce the Senior Subordinated Note Indenture or the Senior Subordinated Notes except as provided in the Senior Subordinated Note Indenture. Subject to certain limitations, holders of a majority in principal amount of the then outstanding Senior Subordinated Notes may direct the Senior Subordinated Note Trustee in its exercise of any trust power. The Senior Subordinated Note Trustee may withhold from holders of Senior Subordinated Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. In addition, the Senior Subordinated Note Trustee shall have no obligation to accelerate the Senior Subordinated Notes if in the best judgment of the Senior Subordinated Note Trustee acceleration is not in the best interest of the holders of the Senior Subordinated Notes.

For a discussion of the effect of the Intercreditor Agreement on the ability of the Senior Subordinated Note Trustee or the holders of Senior Subordinated Notes to exercise remedies after an Event of Default, see "Description of Intercreditor Agreement--Events of Default; Pre-Completion Remedies" and "--Events of Default; Post-Completion Remedies."

In the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Issuers with the intention and for the purpose of avoiding payment of

the premium that the Issuers would have had to pay if the Issuers then had elected to redeem the Senior Subordinated Notes pursuant to the optional redemption provisions of the Senior Subordinated Note Indenture, an equivalent premium shall also become and be immediately due and payable to the extent permitted by law.

The holders of a majority in aggregate principal amount of the Senior Subordinated Notes then outstanding by notice to the Senior Subordinated Note Trustee may on behalf of the holders of all of the Senior Subordinated Notes waive any existing Default or Event of Default and its consequences under the Senior Subordinated Note Indenture except a continuing Default or Event of Default in the payment of interest on, premium or Liquidated Damages, if any, or the principal of, any Senior Subordinated Note held by a non-consenting holder.

The Issuers are required to deliver to the Senior Subordinated Note Trustee annually a statement regarding compliance with the Senior Subordinated Note Indenture, and the Issuers are required, within five Business Days, upon becoming aware of any Default or Event of Default or any default under any document, instrument or agreement representing Indebtedness of the Issuers, to deliver to the Senior Subordinated Note Trustee a statement specifying such Default or Event of Default.

No Personal Liability of Directors, Officers, Employees, Incorporators and Stockholders

No director, officer, employee, incorporator or stockholder of the Issuers or the Senior Subordinated Note Guarantors, as such, has any liability for any obligations of the Issuers or the Senior Subordinated Note Guarantors under the Senior Subordinated Notes, any Senior Subordinated Note Guarantee, the Senior Subordinated Note Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each holder of the Senior Subordinated Notes by accepting a Senior Subordinated Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Senior Subordinated Notes and the Senior Subordinated Note Guaranties.

Legal Defeasance and Covenant Defeasance

The obligations of the Issuers and the Senior Subordinated Note Guarantors under the Senior Subordinated Note Indenture will terminate (other than certain obligations) upon payment in full of all of the Senior Subordinated Notes. The Issuers may, at their option and at any time, elect to have all of their and any Senior Subordinated Note Guarantor's obligations discharged with respect to the outstanding Senior Subordinated Notes and any Senior Subordinated Note Guarantees ("Legal Defeasance") and cure all then existing Events of Default except for (i) the rights of holders of outstanding Senior Subordinated Notes to receive payments in respect of the principal of, premium, if any, and interest on such Senior Subordinated Notes when such payments are due solely out of the trust created pursuant to the Senior Subordinated Note Indenture,
(ii) the Company's, Venetian's and any Senior Subordinated Note Guarantor's obligations with respect to the Senior Subordinated Notes concerning issuing temporary Senior Subordinated Notes, registration of Senior Subordinated Notes, mutilated, destroyed, lost or stolen Senior Subordinated Notes and the maintenance of an office or agency for payment and money for security payments held in trust, (iii) the rights, powers, trusts, duties and immunities of the Senior Subordinated Note Trustee, and the Issuers' and any Senior Subordinated Note Guarantor's obligations in connection therewith and (iv) the Legal Defeasance provisions of the Senior Subordinated Note Indenture. In addition, the Issuers may, at their option and at any time, elect to have the obligations of the Issuers and any Senior Subordinated Note Guarantor released with respect to certain covenants that are described in the Senior Subordinated Note Indenture ("Covenant Defeasance") and, thereafter, any omission to comply with such obligations shall not constitute a Default or Event of Default with respect to the Senior Subordinated Notes. In the event Covenant Defeasance occurs, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) described under "Events of Default" will no longer constitute an Event of Default with respect to the Senior Subordinated Notes.

In order to exercise either Legal Defeasance or Covenant Defeasance, (i) the Issuers must irrevocably deposit with the Senior Subordinated Note Trustee, in trust, for the benefit of the holders of the Senior Subordinated Notes, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm

of independent public accountants, to pay the Accreted Value thereof (determined at the date of redemption) if prior to the second anniversary of the issuance date or the principal amount thereof, premium and Liquidated Damages, if any, and interest due on the outstanding Senior Subordinated Notes on the stated maturity date or on the applicable redemption date, as the case may be, in accordance with the terms of the Senior Subordinated Note Indenture;
(ii) in the case of Legal Defeasance, the Issuers shall have delivered to the Senior Subordinated Note Trustee an opinion of tax counsel in the United States reasonably acceptable to the Senior Subordinated Note Trustee confirming that, (A) the Issuers have received from the United States Internal Revenue Service a ruling (a copy of which shall accompany such opinion of counsel) or (B) since the Issuance Date of the Senior Subordinated Note Indenture, there has been a change in the applicable U.S. federal income tax law such that a ruling is no longer required, in either case to the effect that, and based thereon such opinion of tax counsel in the United States shall confirm that, subject to customary assumptions and exclusions, the holders of the outstanding Senior Subordinated Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
(iii) in the case of Covenant Defeasance, the Issuers shall have delivered to the Senior Subordinated Note Trustee an opinion of tax counsel in the United States reasonably acceptable to the Senior Subordinated Note Trustee confirming that the holders of the outstanding Senior Subordinated Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (iv) no Default or Event of Default shall have occurred and be continuing with respect to certain Events of Default on the date of such deposit; (v) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than the Senior Subordinated Note Indenture) to which the Issuers or any of their Subsidiaries is a party or by which the Issuers or any of their Subsidiaries is bound; (vi) the Issuers shall have delivered to the Senior Subordinated Note Trustee an opinion of counsel to the effect that, as of the date of such opinion following the deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally under any applicable United States state law and that the Senior Subordinated Note Trustee has a perfected security interest in such trust funds for the ratable benefit of the holders; (vii) the Issuers shall have delivered to the Senior Subordinated Note Trustee an Officers' Certificate stating that the deposit was not made by the Issuers with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuers or others; and (viii) the Issuers shall have delivered to the Senior Subordinated Note Trustee an Officers' Certificate and an opinion of counsel in the United States (which opinion of counsel may be subject to customary assumptions and exclusions) each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance, have been complied with.

Transfer and Exchange

A Holder may transfer or exchange Senior Subordinated Notes in accordance with the Senior Subordinated Note Indenture. The Registrar and the Senior Subordinated Note Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Issuers may require a Holder to pay any taxes and fees required by law or permitted by the Senior Subordinated Note Indenture. The Issuers are not required to transfer or exchange any Senior Subordinated Note selected for redemption. Also, the Issuers are not required to transfer or exchange any Senior Subordinated Note for a period of 15 days before a selection of Senior Subordinated Notes to be redeemed.

The registered Holder of a Senior Subordinated Note will be treated as the owner of it for all purposes.

Amendment, Supplement and Waiver

Except as provided in the next three succeeding paragraphs, the Senior Subordinated Note Indenture, the Senior Subordinated Notes or the Senior Subordinated Note Guaranties may be amended or supplemented with the consent of the holders of at least a majority in principal amount of the Senior Subordinated Notes then outstanding (including consents obtained in connection with a tender offer or

exchange offer for Senior Subordinated Notes), and any existing default or compliance with any provision of the Senior Subordinated Note Indenture, the Senior Subordinated Notes or the Senior Subordinated Note Guaranties may be waived with the consent of the holders of a majority in principal amount of the then outstanding Senior Subordinated Notes (including consents obtained in connection with a tender offer or exchange offer for Senior Subordinated Notes).

Without the consent of each holder affected, an amendment or waiver may not (with respect to any Senior Subordinated Notes held by a nonconsenting holder of Senior Subordinated Notes): (i) reduce the principal amount of Senior Subordinated Notes whose holders must consent to an amendment, supplement or waiver; (ii) reduce the principal of or change the fixed maturity of any Senior Subordinated Note or alter or waive the provisions with respect to the redemption of the Senior Subordinated Notes (other than provisions relating to the covenants described above under the caption "Repurchase at the Option of Holders"); (iii) reduce the rate of or change the time for payment of interest on any Senior Subordinated Note; (iv) waive a Default or Event of Default in the payment of principal of, premium and Liquidated Damages, if any, or interest on the Senior Subordinated Notes (except a rescission of acceleration of the Senior Subordinated Notes by the holders of at least a majority in aggregate principal amount of the Senior Subordinated Notes and a waiver of the payment default that resulted from such acceleration); (v) make any Senior Subordinated Note payable in money other than that stated in the Senior Subordinated Notes; (vi) make any change in the provisions of the Senior Subordinated Note Indenture relating to waivers of past Defaults or the rights of holders of Senior Subordinated Notes to receive payments of principal of or premium and Liquidated Damages, if any, or interest on the Senior Subordinated Notes; or (vii) make any change in the foregoing amendment and waiver provisions.

Notwithstanding the foregoing, without the consent of any holder of Senior Subordinated Notes, the Issuers, the Senior Subordinated Note Guarantors and the Senior Subordinated Note Trustee together may amend or supplement the Senior Subordinated Note Indenture, the Senior Subordinated Notes or the Senior Subordinated Note Guaranties to cure any ambiguity, defect or inconsistency, to comply with the covenant relating to mergers, consolidations and sales of assets, to provide for uncertificated Senior Subordinated Notes in addition to or in place of certificated Senior Subordinated Notes, to provide for the assumption of the Issuers' obligations to holders of the Senior Subordinated Notes in the case of a merger or consolidation, to make any change that would provide any additional rights or benefits to the holders of the Senior Subordinated Notes (including providing for additional Senior Subordinated Note Guaranties pursuant to the Senior Subordinated Note Indenture, or that does not adversely affect the legal rights under the Senior Subordinated Note Indenture of any such holder, to comply with requirements of the Commission in order to effect or maintain the qualification of the Senior Subordinated Note Indenture under the Trust Indenture Act.

Concerning the Senior Subordinated Note Trustee

The Senior Subordinated Note Indenture contains certain limitations on the rights of the Senior Subordinated Note Trustee, should it become a creditor of the Issuers, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Senior Subordinated Note Trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue or resign.

The holders of a majority in principal amount of the then outstanding Senior Subordinated Notes have the right to direct the time, method and place of conducting any proceeding for exercising any remedy, available to the Senior Subordinated Note Trustee, subject to certain exceptions. The Senior Subordinated Note Indenture provides that in case an Event of Default shall occur (which shall not be cured), the Senior Subordinated Note Trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in the conduct of his own affairs. Subject to such provisions, the Senior Subordinated Note Trustee will be under no obligation to exercise any of its rights or powers under the Senior Subordinated Note Indenture at the request of any holder of Senior Subordinated Notes, unless such holder shall have offered to the Senior Subordinated Note Trustee security and indemnity satisfactory to it against any loss, liability or expense.

Governing Law

The Senior Subordinated Note Indenture and the Senior Subordinated Notes are governed by and construed in accordance with the internal laws of the State of New York, without regard to the choice of law rules thereof.

Additional Information

Any holder of the Senior Subordinated Notes or prospective investor may obtain a copy of the Senior Subordinated Note Indenture, the Registration Rights Agreement or the Intercreditor Agreement without charge by writing to Las Vegas Sands, Inc., 3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109; Attention: Corporate Secretary.

Certain Definitions

Set forth below are certain defined terms used in the Senior Subordinated Note Indenture. Reference is made to the Senior Subordinated Note Indenture for full disclosure of all such terms, as well as any other capitalized terms used herein for which no definition is provided.

"Accreted Value" means, as of any date of determination, the sum of (a) the initial offering price of each Senior Subordinated Note and (b) the portion of the excess of (i) the principal amount of each Senior Subordinated Note over
(ii) such initial offering price that shall have been amortized through such date, such amount to be so amortized on a daily basis and compounded semi-annually on each May 15 and November 15 from the Issuance Date of the Senior Subordinated Notes through the date of determination (until the second anniversary of the Issuance Date) to achieve during such period, an annual rate of return on the principal amount of each Senior Subordinated Note equal to 14 1/4% assuming a current rate of return of 10% per annum on the principal amount of each such Senior Subordinate Note.

"Acquired Indebtedness" means, with respect to any specified Person, (i) Indebtedness of any other Person existing at the time such other Person merged with or into or became a Restricted Subsidiary of such specified Person, including Indebtedness incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Restricted Subsidiary of such specified Person and (ii) Indebtedness encumbering any asset acquired by such specified Person.

"Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise, provided, however, that beneficial ownership of 20% or more of the voting securities of a Person shall be deemed to be control.

"Applicable Tax Percentage" means the highest aggregate effective marginal rate of federal, state and local income tax or, when applicable, alternative minimum tax, to which any direct or indirect member or S corporation shareholder of the Issuers subject to the highest marginal rate of tax would be subject in the relevant year of determination (as certified to the Senior Subordinated Note Trustee by a nationally recognized tax accounting firm), taking into account only that member's or S corporation shareholder's share of income and deductions attributable to its interest in the Issuers.

"Approved Equipment Funding Commitments" means, collectively, (a) the General Electric Capital Corporation Commitment (as defined in the Disbursement Agreement) and (b) any replacement of such commitment from an institutional or other lender reasonably acceptable to the Bank Agent and the Mall Construction Lender if (i) such commitment is in form and substance reasonably satisfactory to the Bank Agent and the Mall Construction Lender and does not include any conditions to funding that are not included in the General Electric Capital Corporation Commitment and (ii) the lender providing such commitment enters into an intercreditor arrangement substantially similar to the intercreditor arrangements of General Electric Capital Corporation.

"Asset Sale" means (i) the sale, conveyance, transfer or other disposition (whether in a single transaction or a series of related transactions) of assets or rights (including by way of a sale and leaseback) of the Issuers or any Restricted Subsidiary (each referred to in this definition as a "disposition") or (ii) the

issuance or sale of Equity Interests of any Restricted Subsidiary other than Venetian (whether in a single transaction or a series of related transactions), in each case, other than (a) a disposition of inventory or goods held in the ordinary course of business, (b) the disposition of all or substantially all of the assets of either of the Issuers in a manner permitted pursuant to the provisions described above under the caption "Certain Covenants--Merger, Consolidation or Sale of Assets" or any disposition that constitutes a Change of Control pursuant to the Senior Subordinated Note Indenture, (c) any disposition that is a Restricted Payment or that is a dividend or distribution permitted under the covenant described above under the caption "Certain Covenants--Restricted Payments" or any Investment that is not prohibited thereunder or any disposition of cash or Cash Equivalents, (d) any single disposition, or related series of dispositions, of assets with an aggregate fair market value of less than $1.0 million, (e) any Event of Loss (as defined in the Mortgage Note Indenture, provided, that any additional proceeds remaining after the application of Net Loss Proceeds (as defined in the Mortgage Note Indenture) in an Event of Loss Offer (as defined in the Mortgage Note Indenture) shall be deemed to be Excess Proceeds for purposes of the covenant described above under the caption "Repurchase at the Option of Holders--Asset Sale," (f) any Lease Transaction or any grant of easement or Permitted Liens, (g) any dedication permitted pursuant to the covenant described above under the caption "Certain Covenants--Restrictions on Leasing and Dedication of Property," (h) the transfer of the Mall Space to the Mall Subsidiary, (i) the transfer of the Phase II Land to the Phase II Subsidiary,
(j) a transfer of assets by the Issuers to a Wholly Owned Restricted Subsidiary of the Issuers or by a Wholly Owned Restricted Subsidiary of the Issuers to another Wholly Owned Restricted Subsidiary of the Issuers, (k) an issuance of Equity Interests by a Wholly Owned Restricted Subsidiary of the Issuers to the Issuers or another Wholly Owned Restricted Subsidiary of the Issuers, (l) any sale, conveyance, transfer or other disposition of property that secures Non-Recourse Financing or any financing permitted by clause (p) under the caption "Certain Covenants--Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" that is to or on behalf of the lender of such Non-Recourse Financing or other financing or (m) any licensing of tradenames or trademarks in the ordinary course of business by any of the Issuers or their Restricted Subsidiaries.

"Bank Agent" means The Bank of Nova Scotia, in its capacity as agent under the Bank Credit Facility and its successors in such capacity.

"Bank Credit Facility" means that certain Credit Agreement among the Company and Venetian, as borrowers, the lenders listed therein, Goldman Sachs Credit Partners L.P., as arranger and syndication agent and The Bank of Nova Scotia, as administrative agent, and any extension, refinancing, renewal, replacement, substitution or refund thereof ("Bank Credit Facility Refinancing"); provided, however that (i) the aggregate amount of such Bank Credit Facility Refinancing shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of reasonable expenses incurred and any premium paid in connection therewith) and (ii) such Bank Credit Facility Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded.

"Billboard Lease" means that certain Lease Agreement by and between Venetian and Mall Subsidiary relating to certain space that will be subleased by "Billboard Live!," as amended from time to time in accordance with the terms thereof.

"Capital Lease Obligation" means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on the balance sheet in accordance with GAAP.

"Capital Stock" means with respect to any Person, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock of such Person, including, without limitation, if such Person is a partnership or limited liability company, partnership or membership interests (whether general or limited) and any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, such partnership or limited liability company.

"Cash Equivalents" means (a) United States dollars, (b)(i) direct obligations of the United States of America (including obligations issued or held in book-entry form on the books of the Department of the Treasury of the United States of America) or obligations fully guaranteed by the United States of America,

(ii) obligations, debentures, notes or other evidence of indebtedness issued or guaranteed by any other agency or instrumentality of the United States, (iii) interest-bearing demand or time deposits (which may be represented by certificates of deposit) issued by banks having general obligations rated (on the date of acquisition thereof) at least "A" or the equivalent by Standard & Poor's Corporation ("S&P") or "A2" by Moody's Investors Service, Inc. ("Moody's") (S&P and Moody's together with any other nationally recognized credit rating agency if neither of such corporations is then currently rating the pertinent obligations, a "Rating Agency") or the equivalent by another Rating Agency, if applicable, or, if not so rated, secured at all times, in the manner and to the extent provided by law, by collateral security in clause (i) or (ii) of this definition, of a market value of no less than the amount of monies so invested, (iv) commercial paper rated (on the date of acquisition thereof) at least "A-1" or "P-1" or the equivalent by any Rating Agency issued by any Person, (v) repurchase obligations for underlying securities of the types described in clause (i) or (ii) above, entered into with any commercial bank or any other financial institution having long-term unsecured debt securities rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency in connection with which such underlying securities are held in trust or by a third-part custodian, (vi) guaranteed investment contracts of any financial institution which has a long-term debt rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency, (vii) obligations (including both taxable and nontaxable municipal securities) issued or guaranteed by, and any other obligations the interest on which is excluded from income for Federal income tax purposes issued by, any state of the United States of America or the District of Columbia or the Commonwealth of Puerto Rico or any political subdivision, agency, authority or instrumentality thereof, which issuer or guarantor has (A) a short-term debt rated (on the date of acquisition thereof) at least "A-1" or "P-1" or the equivalent by any Rating Agency and (B) a long-term debt rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency, (viii) investment contracts of any financial institution either (A) fully secured by (1) direct obligations of the United States, (2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States or (3) securities or receipts evidencing ownership interest in obligations or specified portions thereof described in clause (1) or (2), in each case guaranteed as full faith and credit obligations of the United States of America, having a market value at least equal to 102% of the amount deposited thereunder, or (B) with long-term debt rated (on the date of acquisition of such investment contract) at least "A" or "A2" or the equivalent by any Rating Agency and short-term debt rated (on the date of acquisition of such investment contract) at least "A-1" or "P-1" or the equivalent by any Rating Agency, (ix) a contract or investment agreement with a provider or guarantor (A) which provider or guarantor is rated (on the date of acquisition of such contract or investment agreement) at least "A" or "A2" or the equivalent by any Rating Agency (provided that if a guarantor is party to the rating, the guaranty must be unconditional and must be confirmed in writing prior to any assignment by the provider to another subsidiary of such guarantor), (B) providing that monies invested shall be payable without condition (other than notice) and without brokerage fee or other penalty, upon not more than two Business Days' notice for application when and as required, and (C) stating that such contract or agreement is unconditional, expressly disclaiming any right of setoff and providing for immediate termination in the event of insolvency of the provider and termination upon demand of the Company or any of its secured lenders or their agents after any payment or other covenant default by the provider, or (x) any debt instruments of any Person which instruments are rated (on the date of acquisition thereof) at least "A," "A2," "A-1" or "P-1" or the equivalent by any Rating Agency; provided that in each case of clauses (i) through (x), such investments are denominated in United States dollars and maturing not more than 13 months from the date of acquisition thereof; (c) investments in any money market fund which is rated (on the date of acquisition thereof) at least "A" or "A2" or the equivalent by any Rating Agency; (d) investments in mutual funds sponsored by any securities broker-dealer of recognized national standing having an investment policy that requires substantially all the invested assets of such fund to be invested in investments described in any one or more of the foregoing clauses and having a rating of at least "A" or "A2" or the equivalent by any Rating Agency or (e) investments in both taxable and nontaxable (i) periodic auction reset securities ("PARS") which have final maturities between one and 30 years from the date of issuance and are repriced through a dutch auction or other similar method every 35 days or (ii) auction preferred shares ("APS") which are senior securities of leveraged closed end municipal bond funds and are repriced pursuant to a variety of rate reset periods,

in each case having a rating (at the date of acquisition thereof) of at least "A" or "A2" or the equivalent by any Rating Agency.

"Casino Lease" means that certain lease between the Company and Venetian dated as of the Closing Date with respect to the operation of the Casino for the Project, as amended, revised or modified from time to time in accordance with the terms thereof.

"Change of Control" means the occurrence of any of the following: (i) the sale, lease or transfer, in one or a series of transactions, of all or substantially all of the assets of the Issuers and their Restricted Subsidiaries, taken as a whole (except in connection with an Event of Loss, as defined in the Mortgage Note Indenture); (ii) either of the Issuers becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Sole Stockholder and its Related Parties, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of 50% or more of the total voting power of the Voting Stock of the Issuers; (iii) after an initial public offering of the common stock of the Issuers, the consummation of any transaction or series of transactions the result of which is that any person or group (as defined above), other than the Sole Stockholder and its Related Parties, (1) beneficially owns more of the voting power of the Voting Stock of the Issuers than is beneficially owned, in the aggregate, by the Sole Stockholder and its Related Parties and (2) beneficially owns more than 20% of the voting power of the Voting Stock of either of the Issuers; (iv) the first day within any two-year period on which a majority of the members of the Board of Directors of the Company are not Continuing Directors; (v) the adoption of a plan relating to liquidation or dissolution of either of the Issuers or any Senior Subordinated Note Guarantor (except liquidation of (a) Venetian into the Company and (b) any Senior Subordinated Note Guarantor into the Company, Venetian or another Senior Subordinated Note Guarantor) or (vi) if any Person other than the Sole Stockholder and Related Parties beneficially owns more than 50% of the voting and non voting common stock of the Company.

"Code" means, the Internal Revenue Code of 1986, as amended (or any successor statute thereto).

"Collateral Documents" means, collectively, the Mortgage Notes Indenture Leasehold Deed of Trust, the Mortgage Notes Indenture Fee Deed of Trust, the Mortgage Notes Indenture Mall Parcel Fee Deed of Trust, the Disbursement Agreement, the Completion Guaranty, the Mortgage Notes Indenture Environmental Indemnity or any other agreements, instruments, financing statements or other documents that evidence, set forth or limit the Lien of the Mortgage Note Trustee in the Note Collateral.

"Common Stock" means the Common Stock, par value $.10 per share, of the Company.

"Company" means Las Vegas Sands, Inc., a Nevada corporation, or any successor thereto permitted under the Senior Subordinated Note Indenture.

"Completed" or "Completion" has the meaning given to the term "Mall Release Date" under the Disbursement Agreement, which term generally means that
(a) the Project has been substantially completed in substantial accordance with the Plans and Specifications (except for additions and expansions to the Casino Resort (other than the Mall) not contemplated by the Plans and Specifications in effect on the Issuance Date which additions and expansions will be subject to certain limitations, including the requirement that they do not materially interfere with the use and operation of any other portion of the Casino Resort) and is free of Liens (other than Permitted Liens), (b) the furnishings, fixtures and equipment for the Casino and the Mall have been installed and the furnishings, fixtures and equipment for at least 2000 suites in the Hotel have been installed, (c) the scope and costs to complete remaining items have been quantified, and (d) the Issuers have sufficient available funds, pursuant to the Disbursement Agreement, to pay for remaining project costs plus a specified contingency, each as appropriately certified by the Construction Consultant and/or the Project Architect, all as more particularly set forth in the Disbursement Agreement.

"Completion Guaranty" means that certain Guaranty executed by the Sole Stockholder in favor of the Bank Agent (acting on behalf of the lenders under the Bank Credit Facility), the Mall Construction Lender

and the Mortgage Notes Trustee (acting on behalf of the Mortgage Note holders), as amended, revised or modified from time to time in accordance with the terms thereof.

"Completion Guaranty Loan" means funds provided by the Sole Stockholder in satisfaction of his obligations pursuant to the Completion Guaranty, which are treated by the Sole Stockholder and the Issuers as a subordinated loan to the Issuers pursuant to the Completion Guaranty.

"Consolidated Cash Flow" means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus (a) an amount equal to any extraordinary loss plus any net loss realized in connection with an Asset Sale (to the extent such losses were deducted in computing Consolidated Net Income), plus (b) provision for taxes based upon net income or net profits of such Person and its Restricted Subsidiaries to the extent such provision for taxes was deducted in computing Consolidated Net Income, plus (c) Consolidated Interest Expense of such Person for such period to the extent such expenses were deducted in computing Consolidated Net Income (not including any gaming revenue tax), plus (d) Consolidated Depreciation and Amortization Expense of such Person for such period to the extent such expenses were deducted in computing Consolidated Net Income, minus (e) non-cash items increasing such Consolidated Net Income for such period, in each case, on a consolidated basis for such Person and its Restricted Subsidiaries and determined in accordance with GAAP.

"Consolidated Depreciation and Amortization Expense" means with respect to any Person for any period, the total amount of depreciation and amortization expense and other noncash expenses (excluding any noncash expense that represents an accrual, reserve or amortization of a cash expenditure for a past, present or future period) of such Person and its Restricted Subsidiaries for such period on a consolidated basis as defined in accordance with GAAP.

"Consolidated Interest Expense" means, with respect to any period, the sum of (a) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, to the extent such expense was deducted in computing Consolidated Net Income (including original issue discount and deferred financing fees, non-cash interest payments, the interest component of Capital Lease Obligations, and net payments (if any) pursuant to Hedging Obligations, but excluding amortization of debt issuance costs and deferred financing fees), (b) commissions, discounts and other fees and charges paid or accrued with respect to letters of credit and bankers' acceptance financing and (c) to the extent not included above, the maximum amount of interest which would have to be paid by such Person or its Restricted Subsidiaries under a Guarantee of Indebtedness of any other Person if such Guarantee were called upon.

"Consolidated Net Income" means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided, however, that (i) the Net Income for such period of any Person that is not a Subsidiary or that is accounted for by the equity method of accounting, shall be included only to the extent of the amount of dividends or distributions paid in cash (or to the extent converted into cash) to the referent Person or a Wholly Owned Subsidiary thereof in respect of such period,
(ii) the Net Income of any Person acquired in a pooling of interests transaction shall not be included for any period prior to the date of such acquisition, (iii) the Net Income for such period of any Restricted Subsidiary that is not a Senior Subordinated Note Guarantor shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of its Net Income is not at the date of determination permitted without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restriction with respect to the payment of dividends or in similar distributions has been legally waived, (iv) the cumulative effect of a change in accounting principles shall be excluded and (v) no effect shall be given to any minority or preferred interest in Venetian for purposes of computing Consolidated Net Income.

"Consolidated Net Worth" means, with respect to any Person at any time, the sum of the following items, as shown on the consolidated balance sheet of such Person and its Restricted Subsidiaries as of such date (i) the common equity of such Person and its Restricted Subsidiaries; (ii) (without duplication), (a) the aggregate liquidation preference of Preferred Stock of such Person and its Restricted Subsidiaries

(other than Disqualified Stock), and (b) any increase in depreciation and amortization resulting from any purchase accounting treatment from an acquisition or related financing; (iii) less any goodwill incurred subsequent to the Issuance Date; and (iv) less any write up of assets (in excess of fair market value) after the Issuance Date, in each case on a consolidated basis for such Person and its Restricted Subsidiaries, determined in accordance with GAAP; provided, that in calculating Consolidated Net Worth, any gain or loss from any Asset Sale shall be excluded; provided, however that in computing "Consolidated Net Worth," no adjustment shall be made for any minority interest in Venetian.

"Construction Consultant" means Tishman Construction Corporation of Nevada or any other Person designated from time to time by the Bank Agent, the Mall Construction Lender and the Senior Subordinated Notes Trustee, in their sole discretion acting pursuant to the Intercreditor Agreement, to serve as the Construction Consultant under the Disbursement Agreement.

"Construction Management Agreement" means that certain Construction Management Agreement between the Company and the Construction Manager, dated as of February 15, 1997, as such agreement may be amended, modified, supplemented, restated or replaced from time to time.

"Construction Manager" means Lehrer McGovern Bovis, Inc., a New York corporation.

"Continuing Directors" means, as of any date of determination, any member of the Board of Directors who (i) was a member of such Board of Directors on the Issuance Date, (ii) was nominated for election or elected to such Board of Directors with, or whose election to such Board of Directors was approved by, the affirmative vote of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election or (iii) was appointed or elected to such Board of Directors by the Sole Stockholder or a Related Party.

"Contracts" means, collectively, the contracts entered into, from time to time, between the Company and any contractor for performance of services or sale of goods in connection with the design, engineering, installation or construction of the Project.

"Cooperation Agreement" means that certain Amended and Restated Reciprocal Easement, Use and Operating Agreement among the Mall Construction Subsidiary, Venetian and Interface, as amended, revised or modified from time to time in accordance with its terms.

"Default" means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.

"Designated Senior Debt" means (i) any Indebtedness outstanding under the Bank Credit Facility and (ii) any other Senior Debt permitted under the Senior Subordinated Note Indenture, the principal amount of which is $20.0 million or more and that has been designated by the Issuers as "Designated Senior Debt"; provided, however, that the FF&E Financing does not constitute Designated Senior Debt.

"Direct Construction Guaranty" means that certain Guaranty of Performance and Completion executed by Bovis, Inc., a New York corporation, in favor of the Company, as assigned by the Company to Venetian by that certain Assignment Agreement by and among the Company, Venetian and Bovis, Inc., as amended, revised or modified from time to time in accordance with its terms.

"Disbursement Agent" means The Bank of Nova Scotia, in its capacity as the disbursement agent under the Disbursement Agreement and its successors in such capacity.

"Disbursement Agreement" means that certain Funding Agents' Disbursement and Administration Agreement among the Issuers, Mall Construction Subsidiary, the Bank Agent, the Mortgage Notes Trustee, the Mall Construction Lender, the HVAC Provider and the Disbursement Agent, as amended, revised or modified from time to time in accordance with its terms.

"Disqualified Stock" means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to November 15, 2005; provided, however, that any Capital Stock which would not constitute Disqualified Stock but for provisions thereof giving holders

thereof the right to require the Issuers to repurchase or redeem such Capital Stock upon the occurrence of a Change of Control, or an Asset Sale occurring prior to the final maturity of the Senior Subordinated Notes shall not constitute Disqualified Stock if the change of control provisions, event of loss provisions, or asset sale provisions, as the case may be, applicable to such Capital Stock specifically provide that the Issuers will not repurchase or redeem any such stock pursuant to such provisions prior to the Company's and Venetian's compliance with the provisions of the Senior Subordinated Note Indenture, including the covenant described under "Repurchase at the Option of Holders--Change of Control" and "--Asset Sales."

"Equity Contribution" means the approximately $320.3 million of proceeds received by Venetian from the Company, Interface Holding or the Sole Stockholder (in the form of cash or property).

"Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

"Estimation Period" means the period for which a shareholder, partner or member, who is an individual is required to estimate for federal income tax purposes his allocation of taxable income from a Subchapter S corporation or a partnership for federal income tax purposes in connection with determining his estimated federal income tax liability for such period.

"Existing Indebtedness" means (i) up to $1.5 million in aggregate principal amount of Indebtedness (other than Capital Lease Obligations) of the Company or its Restricted Subsidiaries in existence on the Issuance Date, plus interest accruing thereon, after application of the net proceeds of sale of the Senior Subordinated Notes on the Issuance Date and (ii) any current or future obligations under the HVAC Services Agreement as in effect on the Issuance Date.

"Expo Center" means the Sands Expo and Convention Center.

"Fixed Charge Coverage Ratio" means, with respect to any Person for any period, the ratio of the Consolidated Cash Flow of such Person for such period to the Fixed Charges of such Person for such period. In the event that the Company or any of its Restricted Subsidiaries incurs, assumes, guarantees or redeems any Indebtedness (other than revolving credit borrowings) or issues Preferred Stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee or redemption of Indebtedness and the use of proceeds therefrom, or such issuance or redemption of Preferred Stock, as if the same had occurred at the beginning of the applicable four-quarter period. For purposes of making the computation referred to above, acquisitions, dispositions and discontinued operations (as determined in accordance with GAAP) that have been made by the Company or any of its Restricted Subsidiaries, including all mergers, consolidations and dispositions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date shall be calculated on a pro forma basis assuming that all such acquisitions, dispositions, discontinued operations, mergers, consolidations (and the reduction of any associated fixed charge obligations resulting therefrom) had occurred on the first day of the four-quarter reference period.

"Fixed Charges" means, with respect to any Person for any period, the sum, without duplication, of (a) Consolidated Interest Expense of such Person for such period and (b) all capitalized interest of such Person and its Restricted Subsidiaries and (c) the product of (i) to the extent such Person is not treated as an S corporation, a partnership or a substantially similarly treated pass-through entity for federal income tax purposes, all dividend payments, whether or not in cash on any series of Preferred Stock of such Person or any of its Subsidiaries, other than dividend payments on Equity Interests payable solely in Equity Interests or dividends paid as an increase in liquidation preference on Preferred Stock, times (ii) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory income tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP.

"GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public

Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect on the Issuance Date. For the purposes of the Senior Subordinated Note Indenture, the term "consolidated" with respect to any Person shall mean such Person consolidated with its Restricted Subsidiaries (without giving effect to any minority or preferred interest of Venetian) and shall not include any Unrestricted Subsidiary or Special Subsidiary.

"Gaming Authority" means any agency, authority, board, bureau, commission, department, office or instrumentality of any nature whatsoever of the United States or foreign government, any state, province or any city or other political subdivision, whether now or hereafter existing, or any officer or official thereof, including without limitation, the Nevada Gaming Commission, the Nevada State Gaming Control Board, the Clark County Liquor and Gaming Licensing Board and any other agency with authority to regulate any gaming operation (or proposed gaming operation) owned, managed or operated by the Issuers or any of its Subsidiaries.

"Gaming License" means every license, franchise or other authorization required to own, lease, operate or otherwise conduct governing activities of the Issuers or any of their Restricted Subsidiaries, including without limitation, all such licenses granted under the Nevada Gaming Control Act, and the regulations promulgated pursuant thereto, and other applicable federal, state, foreign or local laws.

"Government Instrumentality" means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, public or statutory instrumentality, authority, body, agency, bureau or entity, (including any zoning authority, the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central bank or any comparable authority) or any arbitrator with authority to bind a party at law.

"Government Securities" means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended), as custodian with respect to any such Government Security or a specific payment of principal of or interest on any such Government Security held by such custodian for the account of the holder of such depository receipt; provided, that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Security or the specific payment of principal of or interest on the Government Security evidenced by such depository receipt.

"Guaranty" means a guaranty (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness.

"Harrah's Road Way Agreement" means an agreement between Venetian and Harrah's Casino Resort, as amended, modified or restated, as contemplated by the existing letter of intent between the parties with respect to the sharing of the common road between the parties and certain plans with respect to the improvements to be made thereto.

"Hedging Obligations" means, with respect to any Person, the obligations of such Person under (i) currency exchange or interest rate swap agreements, currency exchange or interest rate cap agreements and currency exchange or interest rate collar agreements and (ii) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange or interest rates.

"HVAC Provider" means Atlantic-Pacific Las Vegas, LLC, a Delaware limited liability company.

"HVAC Services Agreement" means, collectively (i) that certain Energy Services Agreement between Venetian and the HVAC Provider (ii) that certain Ground Lease between Venetian and the HVAC Provider, (iii) that certain Construction Agency Agreement between Venetian and the HVAC Provider and (iv) that certain Energy Services Agreement between the Mall Subsidiary and the HVAC Provider, in each case, as amended, revised or modified from time to time in accordance with its terms.

"Indebtedness" means, with respect to any Person, (a) any indebtedness of such Person, whether or not contingent (i) in respect of borrowed money, (ii) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof), (iii) representing the balance deferred and unpaid of the purchase price of any property (including Capital Lease Obligations), except any such balance that constitutes an accrued expense or trade payable, or (iv) representing any Hedging Obligations, if and to the extent any of the foregoing indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of such Person prepared in accordance with GAAP, (b) to the extent not otherwise included, any obligation by such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness of another Person (other than by endorsement of negotiable instruments for collection in the ordinary course of business) and (c) to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset owned by such Person (whether or not such Indebtedness is assumed by such Person). For purposes of this definition, the term "Indebtedness" shall not include any amount of the liability in respect of an operating lease that at such time would not be required to be capitalized and reflected as a liability on the balance sheet in accordance with GAAP. The amount of any Indebtedness outstanding as of any date shall be (i) the accreted value thereof, in the case of any Indebtedness with original issue discount, and (ii) the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness.

"Independent Financial Advisor" means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the judgment of the Company's Board of Directors, (i) qualified to perform the task for which it has been engaged and (ii) disinterested and independent with respect to the Company and its Subsidiaries, each Affiliate of the Company, and the Sole Stockholder and its Related Parties.

"Indirect Construction Guaranty" means that certain Guaranty of Performance executed by The Peninsular and Oriental Steam Navigation Company, a corporation organized under the laws of England and Wales, in favor of the Company, as assigned by the Company to Venetian by that certain Assignment Agreement by and among the Company, Venetian and The Peninsular and Oriental Steam Navigation Company, as amended, revised or modified from time to time in accordance with its terms.

"Interface" means Interface Group-Nevada, Inc., a Nevada corporation and wholly owned indirect subsidiary of the Sole Stockholder.

"Interface Holding" means Interface Group Holding Company, Inc., a Nevada corporation and a wholly owned direct Subsidiary of the Sole Stockholder.

"Intercreditor Agreement" means the Intercreditor Agreement, among The Bank of Nova Scotia, as Bank Agent acting on behalf of the lenders pursuant to the Bank Credit Facility, the Mortgage Note Trustee, acting on behalf of the holders of the Mortgage Notes, the Mall Construction Lender and the Senior Subordinated Note Trustee, acting on behalf of the holders of the Senior Subordinated Notes, as amended, revised, modified or restated from time to time in accordance with its terms.

"Investments" means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including Guarantees), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities and all other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP.

"Issuance Date" means the closing date for the sale and original issuance of the Senior Subordinated Notes.

"Lenders" means any of the lenders under the Bank Credit Facility, the Interim Mall Lender and the Senior Subordinated Note holders.

"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).

"Mall" means that certain enclosed retail, dining and entertainment complex of approximately 500,000 net leasable square feet more particularly described in the Plans and Specifications.

"Mall Collateral" means all of the Issuers' and their Subsidiaries' right, title, and interest in and to (i) prior to creation of the Mall I Parcel, the leasehold estate created by the Mall Lease and, thereafter, the Mall I Parcel;
(ii) the leasehold estate created by the Billboard Lease; (iii) the Mall and any related improvements and equipment thereto; (iv) any reserves established by the Issuers, any of their Restricted Subsidiaries or any of their Special Subsidiaries relating to the Mall and (v) any and all security agreements and an assignment of leases and rents creating a security interest in any rents or other income derived from the Mall.

"Mall Construction Lender" means GMAC Commercial Mortgage Corporation, a California corporation, and its permitted successors and assigns.

"Mall Construction Loan Agreement" means that certain Credit Agreement between the Issuers, Mall Construction Subsidiary and Mall Construction Lender, as amended, revised or modified from time to time in accordance with its terms.

"Mall Construction Loan Facility" means the credit facility described and made available to the Issuers and Mall Construction Subsidiary pursuant to the Mall Construction Loan Agreement and any extension, refinancing, renewal, replacement, substitution or refunding thereof ("Mall Construction Loan Facility Refinancing"); provided, however that (i) the aggregate amount of Indebtedness under such Mall Construction Loan Facility Refinancing shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of reasonable expenses incurred and any premium paid in connection therewith), (ii) such Mall Construction Loan Facility Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life Maturity of the Indebtedness being extended, refinanced, renewed, replaced, substituted or refunded and (iii) to the extent such Mall Construction Loan Facility Refinancing Indebtedness is not supported by a guaranty of the Sole Stockholder on substantially similar terms as the terms of the Sole Stockholder's guaranty of Tranche B of the Mall Construction Loan Facility, such Mall Construction Loan Facility Refinancing Indebtedness shall contain a tranche with a principal amount, relative payment priority and other terms which are substantially similar to those required to be contained in the Substitute Tranche B Loan.

"Mall Construction Subsidiary" means Grand Canal Shops Mall Construction, LLC, a Delaware limited liability company, and a wholly owned subsidiary of Venetian.

"Mall Holdings" means Grand Canal Shops Mall Holding Company, LLC, a Delaware limited liability company and a subsidiary of Mall Intermediate Holdings.

"Mall Intermediate Holdings" means Mall Intermediate Holding Company, LLC, a Delaware limited liability company, and a wholly owned subsidiary of Venetian.

"Mall I Parcel" means the phase I mall space sudivided from the Project Site as a legally separate parcel and recorded with the applicable Government Instrumentalities.

"Mall Lease" means the Lease by and between Venetian and Mall Construction Subsidiary pursuant to which Mall Construction Subsidiary leases from Venetian the Mall Space, as amended, revised or modified from time to time in accordance with its terms.

"Mall Management Agreement" means the Mall Management Agreement between Forest City Enterprises and the Mall Construction Subsidiary, as amended, revised or modified.

"Mall Manager" means Grand Canal Shops Mall MM, Inc., wholly owned subsidiary of the Company.

"Mall Space" means that certain space referred to as the "Mall" in and on the Project as more specifically described in an Annex to the Senior Subordinated Note Indenture.

"Mall Subsidiary" means Grand Canal Shops Mall, LLC, a Delaware limited liability company.

"Mortgage Notes" means the Company's 12 1/4% Mortgage Notes due November 15, 2004 issued pursuant to the Mortgage Note Indenture.

"Mortgage Notes Indenture Environmental Indemnity" means that Environmental Indemnity Agreement among the Company, Venetian and the Mortgage Note Trustee, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Fee Deed of Trust" means that certain Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing made by the Company and Venetian, as trustor, to the trustee thereunder for the benefit of the Mortgage Note Trustee, as beneficiary, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Leasehold Deed of Trust" means that certain Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing, dated as of November 14, 1997 and made by the Mall Construction Subsidiary, as trustor, to the trustee thereunder for the benefit of the Mortgage Note Trustee, as beneficiary, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Indenture Mall Parcel Fee Deed of Trust" means the deed of trust in the form of Exhibit V-4 to the Disbursement Agreement executed by Mall Construction Subsidiary for the benefit of the Mortgage Note Trustee in accordance with the Disbursement Agreement, as amended, modified or revised in accordance with its terms.

"Mortgage Notes Proceeds Account" means that certain Mortgage Notes Proceeds Account into which the net proceeds from the sale of the Mortgage Notes were deposited in accordance with the Disbursement Agreement.

"Net Income" means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Stock dividends, excluding, however, (i) any gain (but not loss), together with any related provision for taxes on such gain (but not loss), realized in connection with (a) any Asset Sale (including, without limitation, dispositions pursuant to sale and leaseback transactions) or (b) the disposition of any securities or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries, and (iii) excluding any extraordinary gain (but not loss), together with any related provision for taxes on such extraordinary gain (but not loss).

"Net Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale, net of the direct costs relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees and expenses, employee severance and termination costs, any trade payables or similar liabilities related to the assets sold and required to be paid by the seller as a result thereof and sales, finder's or broker's commissions), and any relocation expenses incurred as a result thereof, taxes paid or payable as a result thereof (including, without limitation, any taxes paid or payable by an owner of the Issuers or any Restricted Subsidiary) (after taking into account any available tax credits or deductions and any tax sharing arrangements), amounts required to be applied to the repayment of Indebtedness secured by a Lien (other than the Senior Subordinated Notes) on the asset or assets that are the subject of such Asset Sale or amounts permitted by the terms of such Indebtedness to be otherwise reinvested in the Project to the extent so reinvested, all distributions and other payments required to be made to minority interest holders in a subsidiary or joint venture as a result of the Asset Sale and any reserve for adjustment in respect of the sale price of such asset or assets or any liabilities associated with the asset disposed of in such Asset Sale.

"Non-Recourse Financing" means Indebtedness incurred in connection with the purchase or lease of personal or real property useful in the Principal Business or to construct, develop or equip the Mall Space and (i) as to which the lender upon default may seek recourse or payment against the Company or any Restricted Subsidiary only through the return or sale of the property or equipment or the other Specified FF&E so purchased or leased, or in the case of any Indebtedness with respect to the Mall Space, only through foreclosure upon the Mall Collateral and (ii) may not otherwise assert a valid claim for payment on such Indebtedness against the Company or any Restricted Subsidiary or any other property of the Company or any Restricted Subsidiary.

"Non-Recourse Indebtedness" means Indebtedness or Disqualified Stock, as the case may be, or that portion of Indebtedness or Disqualified Stock, as the case may be, (a) as to which neither the Company nor any of its Restricted Subsidiaries (i) provides credit support pursuant to any undertaking, agreement or instrument that would constitute Indebtedness or Disqualified Stock, as the case may be,

or (ii) is directly or indirectly liable, and (b) with respect to Non-Recourse Indebtedness of an Unrestricted Subsidiary, no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness or Disqualified Stock, as the case may be, of the Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or Disqualified Stock, as the case may be, or cause the payment thereof to be accelerated or payable prior to its stated maturity.

"Note Collateral" means all assets, now owned or hereafter acquired, of the Company, Venetian or any Mortgage Note Guarantor defined as Collateral in the Collateral Documents, which will initially include (with certain exceptions) all real estate, improvements and all personal property owned by the Issuers (including (i) the Project Assets, (ii) the Mall Collateral, until the transfer and release thereof in accordance with the Sale and Contribution Agreement and the Disbursement Agreement), as well as a pledge of any intercompany notes held by either of the Issuers or the Senior Subordinated Note Guarantors.

"Obligations" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

"Officers' Certificate" means a certificate signed on behalf of the Issuers or a Senior Subordinated Note Guarantor, as the case may be, by two Officers (or if a limited liability company, two Officers of the managing member of such limited liability company) of the Issuers or a Senior Subordinated Note Guarantor, as the case may be, one of whom must be the principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of the Company, Venetian (or its managing members) or a Senior Subordinated Note Guarantor, as the case may be, that meets the requirements set forth in the Senior Subordinated Note Indenture.

"Outside Completion Deadline" means April 21, 1999, as the same may from time to time be extended pursuant to the Disbursement Agreement.

"Other Phase II Agreements" means any agreement entered into by the Issuers or their Subsidiaries with a Person for construction, development and operation of a hotel or casino on the Phase II Land (other than the Phase II Resort).

"Permitted Construction Loan Refinancing" means (i) the incurrence of indebtedness and/or the issuance of Capital Stock by the Mall Subsidiary the proceeds of which are used to purchase the Mall Collateral pursuant to the Sale and Contribution Agreement (including, without limitation, the Tranche A Take-out Commitment and the Tranche B Take-out Commitment) and/or (ii) the assumption of the Mall Construction Loan Facility and/or the Substitute Tranche B Loan (or any permitted refinancing thereof) pursuant to the Sale and Contribution Agreement.

"Permitted Investments" means (a) any Investments in the Issuers, any Senior Subordinated Note Guarantor or in any Restricted Subsidiary that is not a Senior Subordinated Note Guarantor if the Investments in such Restricted Subsidiary that is not a Senior Subordinated Note Guarantor from the Issuers, any Senior Subordinated Note Guarantor or any of the other Restricted Subsidiaries aggregate less than $1.0 million; (b) any Investments in Cash Equivalents; (c) Investments by the Issuers or any Restricted Subsidiary of the Issuers in a Person, if as a result of such Investment (i) such Person becomes a Senior Subordinated Note Guarantor or (ii) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, one of the Issuers or a Senior Subordinated Note Guarantor; (d) any Restricted Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above under the caption "Repurchase at the Option of Holders--Asset Sales"; (e) any acquisition of assets solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Issuers; (f) receivables owing to the Issuers or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances; (g) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business; (h) loans or advances to employees of the Issuers or their Restricted Subsidiaries or Special Subsidiaries

(i) to fund the exercise price of options granted under employment agreements and the Issuers' stock option plans or agreements, in each case, as in effect on the date of the Senior Subordinated Note Indenture or (ii) for any other purpose not to exceed $2.0 million in the aggregate at any one time outstanding under this clause (ii); (i) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Issuers and any Restricted Subsidiary or in satisfaction of judgments; (j) other Investments in any Person (other than in an Affiliate of the Issuers) having a fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (j) that are at the time outstanding, not to exceed $5.0 million; (k) Investments in any Person engaged in the Principal Business which Investment is solely in the form of Equity Interests (other than Disqualified Stock) of the Issuers and (l) the initial designation on the Issuance Date of (i) Phase II Subsidiary, Phase II Holdings and Phase II Manager as Unrestricted Subsidiaries and (ii) Mall Subsidiary, Mall Holdings and Mall Manager as Special Subsidiaries; provided, that, in each case, no more than $1,000 is invested any such Person at the time of designation.

"Permitted Junior Securities" means Equity Interests in the Company or Venetian or debt securities that are subordinated to all Senior Debt (and any debt securities issued in exchange for Senior Debt) to substantially the same extent as, or to a greater extent than, the Senior Subordinated Notes are subordinated to Senior Debt pursuant to Article 10 of the Senior Subordinated Note Indenture.

"Permitted Liens" means (a) Liens in favor of the Issuers and their Wholly Owned Restricted Subsidiaries; provided that if such Liens are on any Note Collateral, that such Liens are either collaterally assigned to the Mortgage Note Trustee or subordinate to the Lien in favor of the Mortgage Note Trustee securing the Mortgage Notes or any Mortgage Note Guaranty; (b) Liens on property of a Person existing at the time such Person became a Restricted Subsidiary, is merged into or consolidated with or into, or wound up into, one of the Issuers or any Restricted Subsidiary of the Issuers; provided, that such Liens were in existence prior to the contemplation of such acquisition, merger or consolidation or winding up and do not extend to any other assets other than those of the Person acquired by, merged into or consolidated with one of the Issuers or such Restricted Subsidiary; (c) Liens on property existing at the time of acquisition thereof by the Issuers or any Restricted Subsidiary of the Issuers; provided that such Liens were in existence prior to the contemplation of such acquisition; (d) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business or in the construction of the Project and which obligations are not expressly prohibited by the Senior Subordinated Note Indenture; provided, however, that the Issuers have obtained a title insurance endorsement insuring against losses arising therewith or if such Lien arises in the ordinary course of business or in the construction of the Project, the Issuers have bonded within a reasonable time after becoming aware of the existence of such Lien; (e) Liens securing obligations in respect of the Mortgage Note Indenture, the Mortgage Notes and any Secured Mortgage Note Guaranty; (f) Permitted Encumbrances, as such term is defined in the Disbursement Agreement, and leases or other Liens, to the extent permitted pursuant to the covenant entitled "Description of Mortgage Notes-- Restrictions on Leasing and Dedication of Property"; (g) (1) Liens for taxes, assessments or governmental charges or claims or (2) statutory Liens of landlords, and carriers', warehousemen's, mechanics', suppliers', materialmen's, repairmen's or other similar Liens arising in the ordinary course of business or in the construction of the Project, in the case of each of (1) and (2), with respect to amounts that either (A) are not yet delinquent or (B) are being contested in good faith by appropriate proceedings as to which appropriate reserves or other provisions have been made in accordance with GAAP; (h) easements, rights-of-way, navigational servitudes, restrictions, minor defects or irregularities in title and other similar charges or encumbrances which do not interfere in any material respect with the ordinary conduct of business of the Issuers and their Restricted Subsidiaries; (i) after Completion, Liens securing Indebtedness in an aggregate amount not exceeding $25.0 million at any one time securing purchase money or lease obligations otherwise permitted by the Mortgage Note Indenture incurred or assumed in connection with the acquisition, purchase or lease of real or personal property to be used in the Principal Business of the Issuers or any of its Restricted Subsidiaries within 180 days of such incurrence or assumption; provided, that such Liens do not extend to any Note Collateral or to any property or assets of the Issuers or any Restricted Subsidiary other than the property or assets so purchased or leased and, at the time of incurrence, the principal amount of such Indebtedness does not exceed 75% of the value

of the collateral securing such Indebtedness; (j) a leasehold mortgage in favor of a party financing the lessee of space within the Project; provided that neither the Issuers nor any Restricted Subsidiary is liable for the payment of any principal of, or interest or premium on, such financing; (k) Liens securing the Mall Construction Loan Facility and any additional Indebtedness permitted to be incurred thereunder pursuant to clause (n)(A) of the second paragraph of the convenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock;" (l) Liens created by the Cooperation Agreement and the HVAC Services Agreement; (m) Liens on real property of the Issuers arising pursuant to that certain Harrah's Road Way Agreement; (n) Liens created by the Predevelopment Agreement, as in effect on the date of the Mortgage Note Indenture; (o) Liens (i) to secure Indebtedness permitted by clauses (g), (h) or (p) of the second paragraph of the covenant entitled "--Incurrence of Indebtedness and Issuance of Preferred Stock" and extending only to assets or Specified FF&E acquired in accordance with such clauses and to any proceeds of such assets or Indebtedness and related collateral accounts in which such proceeds are held, and (ii) to secure Indebtedness permitted by clause (d) of the second paragraph of the covenant entitled "--Incurrence of Indebtedness and Issuance of Preferred Stock"; provided, that such Liens are not materially greater in extent than the Liens securing the Indebtedness so refinanced; (p) Liens created by the Other Phase II Agreements; (q) Liens to secure all Obligations under the Bank Credit Facility incurred pursuant to clause (a) of the second paragraph of the covenant described above under the caption "--Incurrence of Indebtedness and Issuance of Disqualified Stock" and any additional Indebtedness permitted to be incurred thereunder pursuant to clause (n)(A) of the second paragraph of the convenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock;" (r) until Completion is achieved, Permitted Liens (as defined in the Disbursement Agreement); (s) Liens incurred in connection with the construction of a pedestrian bridge over or a pedestrian tunnel under Las Vegas Boulevard and Sands Avenue; (t) Liens incurred in connection with the traffic study relating to increased traffic on Las Vegas Boulevard as a result of the Completion of the Project; (u) Liens incurred in connection with Hedging Obligations incurred pursuant to clause (f) of the covenant described under the caption "Limitations on Incurrence of Indebtedness and the Issuance of Disqualified Stock"; (v) licenses of patents, trademarks and other intellectual property rights granted by the Issuers or any Subsidiary of the Issuers in the ordinary course of business and not interfering in any material respect with the ordinary conduct of the business of such Issuer or such Subsidiary; (w) any judgment attachment or judgment Lien not constituting an Event of Default; (x) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods; (y) any Lien created under the Sale and Contribution Agreement and (z) after Completion, Liens securing (A) up to an aggregate of $20.0 million of Indebtedness permitted to be incurred pursuant to clause (n)(B) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock" and (B) up to an aggregate of $20.0 million of Indebtedness permitted to be incurred pursuant to clause (o) of the second paragraph of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock."

"Permitted Quarterly Tax Distributions" means quarterly distributions of Tax Amounts determined on the basis of the estimated taxable income of the Company or Venetian, as the case may be (in each case, including any such taxable income attributable to such entity's ownership of interest in any other pass-through entity for Federal income tax purposes) (except that if all or any portion of the Completion Guaranty Loan or the Substitute Tranche B Loan is outstanding and held by the Sole Stockholder or a Related Party and is not paying current cash interest, then such estimated taxable income shall be determined without giving effect to any non-cash interest payments on such loans held by the Sole Stockholder or a Related Party to the extent such non-cash interest is deductible), for the related Estimation Period, as in a statement filed with the Senior Subordinated Note Trustee; provided, however, that (A) prior to any distributions of Tax Amounts the Issuers shall deliver an officers' certificate to the effect that, in the case of distributions to be made by Venetian, Venetian qualifies as a partnership or a substantially similarly treated pass-through entity for federal income tax purposes or that, in the case of distributions to be made by the Company, the Company qualifies as a Subchapter S corporation under the Code or a substantially similarly treated pass-through entity for federal income tax purposes, as the case may be, and (B) at the time of such distributions, the most recent audited financial statements of the Company reflect that the Company was treated as a Subchapter S corporation under the Code or a substantially similarly treated

pass-through entity for federal income tax purposes and Venetian was treated as a partnership or substantially similarly treated pass-through entity for Federal income tax purposes for the period covered by such financial statements; provided, further, that, for an Estimation Period that includes a True-up Determination Date, (A) if the True-up Amount is due to the members or shareholders, as the case may be, the Permitted Quarterly Tax Distribution payable by the Company or Venetian, as the case may be, for the Estimation Period shall be increased by such True-up Amount, and (B) if the True-up Amount is due to the Company or Venetian, the Permitted Quarterly Tax Distribution payable by the Company or Venetian, as the case may be, for the Estimation Period shall be reduced by such True-up Amount and the excess, if any, of the True-up Amount over such Permitted Quarterly Tax Distribution shall be applied to reduce the immediately following Permitted Quarterly Tax Distribution(s) until such True-up Amount is entirely offset. The amount of Permitted Quarterly Tax Distribution relating to an Estimation Period including a True-up Determination Date shall be determined by a Tax Amounts CPA, and the amount of Permitted Quarterly Tax Distribution relating to all other Estimation Periods shall be determined by the Company or Venetian, as the case may be.

"Person" means any individual, corporation, partnership, limited liability company or partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

"Phase II Holdings" means Lido Casino Resort Holding Company, LLC, a Delaware limited liability company and a subsidiary of Phase II Intermediate Holdings.

"Phase II Intermediate Holdings" means Lido Intermediate Holding Company, LLC, a Delaware limited liability company, and a Wholly Owned Subsidiary of the Company.

"Phase II Land" means that portion of the Project Site designated as the Phase II Land in the Collateral Documents, together with all improvements thereon and all rights appurtenant thereto.

"Phase II Manager" means Lido Casino Resort MM, Inc., a special purpose Wholly Owned Subsidiary of the Company.

"Phase II Resort" means the themed hotel and casino currently contemplated to be constructed on the Phase II Land and which will be physically connected to the Casino Resort.

"Phase II Subsidiary" means Lido Casino Resort, LLC, a Nevada limited liability company and, at the Issuance Date, an Unrestricted Subsidiary of the Issuers.

"Plans and Specifications" means the plans and specifications for the construction of the Casino Resort listed in an exhibit to the Disbursement Agreement, as the same may be modified from time to time in accordance with the Disbursement Agreement.

"Pre-development Agreement" means the Sands Resort Hotel & Casino Agreement dated February 18, 1997 by and between Clark County and the Company, as amended, restated and modified from time to time.

"Preferred Stock" means any Equity Interest with preferential right of payment of dividends or upon liquidation, dissolution, or winding up.

"Principal Business" means the casino gaming, hotel, retail and entertainment mall and resort business and any activity or business incidental, directly related or similar thereto (including owning interests in Subsidiaries, operating the conference center and meeting facilities and owning and operating a retail and entertainment mall (including the Mall prior to its transfer to the Mall Subsidiary) and acting as a member of Venetian in the case of the Company), or any business or activity that is a reasonable extension, development or expansion thereof or ancillary thereto, including any hotel, entertainment, recreation, convention, trade show, meeting, retail sales or other activity or business designed to promote, market, support, develop, construct or enhance the casino gaming, hotel, retail and entertainment mall and resort business operated by the Company, Venetian and direct and indirect Restricted Subsidiaries (including, without limitation, engaging in transactions with Affiliates and incurring Indebtedness, providing guarantees or providing other credit support, in each case to the extent permitted under the Senior Subordinated Note Indenture) owning and operating joint ventures to supply materials or services for the

construction or operation of any resorts owned or operated by the Company and its Restricted Subsidiaries and entering into casino leases or management agreements for any casino situated on land owned by the Issuers or any of their Subsidiaries or owned or operated by the Issuers or any Affiliate of the Issuers.

"Project" means the Venetian-themed hotel, casino, retail, meeting and entertainment complex, with related heating, ventilation and air conditioning and power station facilities to be developed at the Project Site, all as more particularly described in Exhibit T-1 to the Disbursement Agreement.

"Project Architect" means collectively, TSA of Nevada, LLP, and WAT&G, Inc. Nevada.

"Project Assets" means, with respect to the Project at any time, all of the assets then in use related to the Project including any real estate assets, any buildings or improvements thereon, and all equipment, furnishings and fixtures, but excluding: (i) the Phase II Land and/or the Mall Collateral and any improvements thereon after their transfer to the Unrestricted Subsidiary or Special Subsidiary as permitted by the Senior Subordinated Note Indenture; (ii) any obsolete personal property determined by the Company's Board of Directors to be no longer useful or necessary to the operations or support of the Project; (iii) the HVAC Equipment owned by the HVAC provider (unless purchased by Venetian or the Mall Construction Subsidiary after the date hereof); and
(iv) any equipment leased from a third party in the ordinary course of business.

"Project Budget" means the Project Budget as in effect on the Issuance Date and attached as an exhibit to the Disbursement Agreement, as amended, revised or modified from time to time in accordance with the terms thereof.

"Project Documents" means the Construction Management Agreement, the Direct Construction Guaranty, the Indirect Construction Guaranty, the Contracts, the Approved Equipment Funding Commitments, the Cooperation Agreement, the HVAC Services Agreement, the Mall Lease, the Sale and Contribution Agreement, the Treadway Agreement, the operating agreement of each of Venetian, Mall Intermediate Holdings, Mall Holdings and Mall Subsidiary and any other document or agreement entered into, relating to the development, construction, maintenance or operation of the Project (other than the documents relating to the Tranche A Take-out Commitment and the Tranche B Take-out Commitment) as the same may be amended from time to time in accordance with the terms and conditions of the Disbursement Agreement.

"Public Equity Offering" means a bona fide underwritten sale to the public of common equity of the Company, Venetian or a Person holding more than 50% of the common equity of the Company pursuant to a registration statement (other than on Form S-8 or any other form relating to securities issuable under any benefit plan of the Company) that is declared effective by the SEC and results in gross aggregate proceeds to the Company or Venetian of at least $20.0 million.

"Quarterly Payment Period" means the period commencing on the tenth day and ending on and including the twentieth day of each month in which federal estimated tax payments are due (provided that payments in respect of estimated state income taxes due in January may instead, at the option of the Issuers, be paid during the last five days of the immediately preceding December).

"Related Parties" means (i) any spouse and any child, stepchild, sibling or descendant of the Sole Stockholder, (ii) any estate of the Sole Stockholder or any person under clause (i), (iii) any person who receives a beneficial interest in the Company or Venetian from any estate under clause (ii) to the extent of such interest, (iv) any executor, personal administrator or trustee who holds such beneficial interest in the Company or Venetian for the benefit of, or as fiduciary for, any person under clauses (i), (ii) or (iii) to the extent of such interest, (v) any corporation, trust, or similar entity owned or controlled by the Sole Stockholder or any person referred to in clause (i),
(ii), (iii) or (iv) or for the benefit of any person referred to in clause (i) and (vi) the spouse or issue of one or more of the individuals described in clause (i).

"Repurchase Offer" means an offer made by the Issuers to purchase all or any portion of a holder's Senior Subordinated Notes pursuant to the covenants described above under the captions entitled "Repurchase at the Option of Holders--Change of Control" or "Repurchase at the Option of Holders--Asset Sales."

"Restricted Investment" means (i) an Investment other than a Permitted Investment or (ii) any sale, conveyance, lease, transfer or other disposition of assets at less than fair market value to an Unrestricted

Subsidiary, provided that the amount of such Restricted Investment under this clause (ii) shall be such difference in value.

"Restricted Subsidiary" means, at any time, any direct or indirect Subsidiary of the Issuers that is not then an Unrestricted Subsidiary or a Special Subsidiary; provided, however, that upon the occurrence of any Unrestricted Subsidiary or Special Subsidiary ceasing to be an Unrestricted Subsidiary or Special Subsidiary, such Subsidiary shall be included in the definition of "Restricted Subsidiary."

"Sale and Contribution Agreement" means that certain Sale and Contribution Agreement among the Venetian, Mall Construction Subsidiary and Mall Subsidiary, as such agreement may be amended, modified or renewed from time to time in accordance with its terms.

"Senior Debt" means (i) all Indebtedness outstanding under Bank Credit Facility and all Hedging Obligations with respect thereto, (ii) Indebtedness represented by the Mortgage Notes and the Mortgage Note Guaranties, (iii) any other Indebtedness permitted to be incurred by the Issuers under the terms of the Senior Subordinated Note Indenture, unless the instrument under which such Indebtedness is incurred expressly provides that it is on a parity with or subordinated in right of payment to the Senior Subordinated Notes and (iv) all Obligations with respect to the foregoing. Notwithstanding anything to the contrary in the foregoing, Senior Debt will not include (w) any liability for federal, state, local or other taxes owed or owing by the Company or Venetian,
(x) any Indebtedness of the Company or Venetian to any of their Subsidiaries or other Affiliates, (y) any trade payables or (z) any Indebtedness that is incurred in violation of the Senior Subordinated Note Indenture.

"Senior Subordinated Note Make-Whole Premium" means, with respect to a Senior Subordinated Note, an amount equal to the greater of (i) (a) 14.25% of the Accreted Value if prior to the second anniversary of the Issuance Date of such Senior Subordinated Note or (b) 14.25% of the outstanding principal amount of such Senior Subordinated Note, if on or after the second anniversary of the Issuance Date of such Senior Subordinated Note and (ii) the excess of (a) the present value of the remaining interest, premium and principal payments due on such Senior Subordinated Note as if such Senior Subordinated Note were redeemed on November 15, 2001, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the outstanding principal amount of such Senior Subordinated Note.

"Senior Subordinated Notes" means the $97.5 million in aggregate principal amount of the Issuers 14 1/4% Senior Subordinated Notes due 2005, and any series of senior subordinated notes issued in exchange for such Senior Subordinated Notes pursuant to the Exchange Offer contemplated by the Registration Rights Agreement.

"Services Agreement" means that Amended and Restated Services Agreement by and among the Company, Interface, Interface Holdings and the parties thereto stated on the signature page, as amended from time to time in accordance with its terms.

"Significant Subsidiary" means any Subsidiary which would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Act, as such Regulation is in effect on the Issuance Date.

"Sole Stockholder" means Sheldon G. Adelson.

"Special Subsidiary" means the Mall Subsidiary, Mall Holdings, Mall Manager and any other Subsidiary so designated by the Board of Directors of the Company in accordance with the terms of the Senior Subordinated Note Indenture.

"Special Subsidiary Permitted Investments" means with respect to any Special Subsidiary (a) any Investments in a Wholly Owned Subsidiary of such Special Subsidiary engaged in a Special Subsidiary Principal Business; (b) any Investments in Cash Equivalents; (c) receivables owing to such Special Subsidiary or any Wholly Owned Subsidiary of such Special Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Special Subsidiary deems reasonable under the circumstances; (d) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting

purposes and that are made in the ordinary course of business; (e) loans or advances to employees made in the ordinary course of business of the Special Subsidiary; (f) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to Special Subsidiary or a Subsidiary or in satisfaction of judgments and (g) other Investments in any Person (other than an Affiliate of the Special Subsidiary) having a fair market value (measured on the date of each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other investments made pursuant to this clause (g) that are at the time outstanding, not to exceed $5.0 million.

"Special Subsidiary Principal Business" means business limited to the following: (i) to acquire, hold, own, manage, market and operate a retail, restaurant and entertainment complex known as the Grand Canal Shops Mall (the "Property"), located at 3355 Las Vegas Boulevard, South, Las Vegas, Nevada,
(ii) to engage in the retail, restaurant and entertainment business at the Property and any activity and business incidental, directly related or similar thereto, and (iii) to engage in any business or activity that is a reasonable extension, development or expansion thereof or ancillary thereto including any retail, restaurant, entertainment or other activity or business designed to promote, market, support, develop, construct or enhance the retail, restaurant and entertainment business operated by Mall Subsidiary (including, without limitation, owning and operating joint ventures to supply materials or services for the construction or operation of the Property, engaging in transactions with Affiliates to the extent permitted under the Senior Subordinated Note Indenture, and incurring Indebtedness, providing guarantees or providing other credit support). Special Subsidiary Principal Business does not mean any of the foregoing to the extent engaged in on the Phase II Land.

"Special Subsidiary Restricted Investment" means (i) an Investment by a Special Subsidiary or a Subsidiary of a Special Subsidiary other than a Special Subsidiary Permitted Investment or (ii) any Investment by a Special Subsidiary or a Subsidiary of a Special Subsidiary in the equity of the Issuers or any of the Issuers' Restricted Subsidiaries.

"Specified FF&E" means any furniture, fixtures, equipment and other personal property financed or refinanced with the proceeds from the incurrence of Indebtedness pursuant to clauses (g), (h) or (p) of the covenant described above under the caption "Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock," including (i) each and every item or unit of equipment acquired with proceeds thereof, (ii) each and every item or unit of equipment acquired in substitution or replacement thereof, (iii) all parts, components and other items pertaining to such collateral, (iv) all documents (including, without limitation, all warehouse receipts, dock receipts, bills of lading and the like), (v) all licenses (other than gaming licenses), warranties, guaranties, service contracts and related rights and interests covering all or any portion of such collateral, (vi) to the extent not otherwise included, all proceeds (including insurance proceeds) of any of the foregoing and all accessions to, substitutions and replacements for, and the rents, profits and products of, each of the foregoing, and (vii) so long as Indebtedness under the Bank Credit Facility is outstanding, such other collateral reasonably determined by the lenders under the Bank Credit Facility to be collateral for Indebtedness incurred in connection with the purchase of Specified FF&E so long as the Lien securing Indebtedness incurred under the Bank Credit Facility does not extend to such collateral.

"Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

"Subordinated Indebtedness" means any Indebtedness of the Issuers or any of their Restricted Subsidiaries which is expressly by its terms subordinated in right of payment to the Senior Subordinated Notes or any Senior Subordinated Note Guaranty.

"Subsidiary" means, with respect to any Person, (i) any corporation, association, or other business entity (other than a partnership) of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof and (ii) any

partnership of which more than 50% of the partnership's capital accounts, distribution rights or general or limited partnership interests are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof.

"Substitute Tranche B Loan" means amounts drawn upon under the guarantee of the Sole Stockholder of the Tranche B loan of the Mall Construction Loan Facility, which amounts, when drawn upon may be treated as a loan to the Issuers from the Sole Stockholder.

"Supplier Joint Venture" means any Person that supplies or provides materials or services to the Issuers or the Construction Manager or any contractor in the Project and in which the Issuers or one of their Restricted Subsidiaries have Investments.

"Tax Amount" means, with respect to a Estimation Period or a taxable year, as the case may be, an amount equal to (A) the product of (x) the taxable income (including all separately stated items of income) of the Company or Venetian, as the case may be, for such Estimation Period or a taxable year, as the case may be, and (y) the Applicable Tax Percentage reduced by (B) to the extent not previously taken into account, any income tax benefit attributable to the Company or Venetian, as the case may be, which could be utilized (without regard to the actual utilization) by its members or shareholders, as the case may be, in the current or any prior taxable year, or portion thereof, commencing on or after the Issuance Date (including any tax losses or tax credits), computed at the Applicable Tax Percentage of the year that such benefit is taken into account for purposes of this computation; provided, however, that, the computation of Tax Amount shall also take into account (C) the deductibility of state and local taxes for federal income tax purposes, and (D) any difference in the Applicable Tax Percentage resulting from the nature of taxable income (such as capital gain as opposed to ordinary income).

"Tax Amounts CPA" means a nationally recognized certified public accounting firm.

"Tranche A Take-out Commitment" means the commitment of Goldman Sachs Mortgage Company or such other lender suitable to the Issuers, to enter into and make a loan in an aggregate of up to $105.0 million thereunder under the Permitted Mall Construction Refinancing or any other commitment to make such a loan that replaces the commitment of Goldman Sachs Mortgage Company in accordance with the Tri-Party Agreement.

"Tranche B Take-out Commitment" means the commitment of the Sole Stockholder to enter into and fund a loan to Mall Subsidiary in an aggregate of up to $35.0 million under the Permitted Mall Construction Refinancing or any other commitment to make such a loan that replaces the commitment of the Sole Stockholder in accordance with the Tri-Party Agreement.

"Tri-Party Agreement" means the agreement between Venetian, the Company, the Sole Stockholder, the Mall Construction Subsidiary, the Mall Subsidiary, the Mall Construction Lender and Goldman Sachs Mortgage Company (or any successor provider of the Tranche A Take-out Commitment), as amended or replaced from time to time in accordance with its terms.

"Treadway Agreement" means that certain Time and Materials Agreement between Owner and Contractor, dated as of February 10, 1997, by and between the Company and Treadway Industries of Phoenix, Inc., an Arizona corporation, as amended, modified or revised from time to time in accordance with its terms.

"Treasury Rate" means the yield to maturity at the time of the computation of the United States Treasury securities with a constant maturity (as compiled by and published in the most recent Federal Reserve Statistical Release H.15(519), which has become publicly available at least two Business Days prior to the date fixed for prepayment (or, if such Statistical Release is no longer published, any publicly available source of similar market data) most nearly equal to the then remaining average life to November 15, 2001; provided, however, that if the average life of such Senior Subordinated Note is not equal to the constant maturity of the United States Treasury security for which weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the average life of such Senior Subordinated Notes is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

"True-up Amount" means, in respect of a particular taxable year, an amount determined by the Tax Amounts CPA equal to the difference between (i) the aggregate Permitted Quarterly Tax Distributions actually distributed in respect of such taxable year, without taking into account any adjustment to such Permitted Quarterly Tax Distributions made with respect to any other taxable year (including any adjustment to take into account a True-up Amount for the immediately preceding taxable year) and (ii) the Tax Amount permitted to be distributed in respect of such year as determined by reference to the Company's Internal Revenue Service Form 1120-S or Venetian's IRS Form 1065 filed for such year; provided, however, that if there is an audit or other adjustment with respect to a return filed by the Company or Venetian (including a filing of an amended return), upon a final determination or resolution of such audit or other adjustment, the Tax Amounts CPA shall redetermine the True-up Amount for the relevant taxable year. The amount equal to the excess, if any, of the amount described in clause (i) above over the amount described in clause (ii) above shall be referred to as the "True-up Amount due to the Company" or the "True-up Amount due to Venetian," as the case may be, and the excess, if any, of the amount described in clause (ii) over the amount described in clause (i) shall be referred to as the "True-up Amount due to the shareholders members."

"True-up Determination Date" means the date on which the Tax Amounts CPA delivers a statement to the Senior Subordinated Note Trustee indication the True-up Amount; provided, however, that the True-up Determination Date shall not be later than 30 days after the occurrence of an event requiring the determination of the True-up Amount (including, the filing of the federal and state tax returns or the final determination or resolution of an audit or other adjustment, as the case may be).

"Unrestricted Subsidiary" means (i) each of Phase II Holdings, Phase II Manager and Phase II Subsidiary; and (ii) any entity that would have been a Restricted Subsidiary of the Company but for its designation as an "Unrestricted Subsidiary" in accordance with the provisions of the Senior Subordinated Note Indenture and any Subsidiary of such entity, so long as it remains an Unrestricted Subsidiary in accordance with the terms of the Senior Subordinated Note Indenture.

"Venetian" means, Venetian Casino Resort, LLC, a Nevada limited liability company.

"Voting Stock" means, with respect to any Person that is a corporation, any class or series of capital stock of such Person that is ordinarily entitled to vote in the election of directors thereof at a meeting of stockholders called for such purpose, without the occurrence of any additional event or contingency and with respect to any other person that is a limited liability company, membership interests entitled to manage the operation or business of the limited liability company.

"Weighted Average Life to Maturity" means, when applied to any Indebtedness or Disqualified Stock, as the case may be, at any date, the number of years (calculated to the nearest one-twelfth) obtained by dividing (a) the sum of the products obtained by multiplying (x) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (y) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (b) the then outstanding principal amount or liquidation preference, as applicable, of such Indebtedness or Disqualified Stock, as the case may be.

"Wholly Owned Restricted Subsidiary" is any Wholly Owned Subsidiary that is a Restricted Subsidiary.

"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors' qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such Person.

"Working Capital Facility" means the credit facility pursuant to any agreement or agreements providing for the making of loans or advances on a revolving basis, the issuance of letters of credit and/or the creation of bankers' acceptances to fund the Issuers' or any of their Restricted Subsidiaries' general corporate requirements and any amendment, supplement, extension, modification, renewal, replacement or refinancing from time to time, including any agreement to renew, extend, refinance or replace all or any portion of such facility.

BOOK-ENTRY, DELIVERY AND FORM

General

Except as set forth below, the New Notes will be issued in the form of one or more registered notes in global form without interest coupons, in denominations of $1,000 and integral multiples thereof (each a "Global Note"). Notes will not be issued in bearer form. The Global Notes will be deposited upon issuance with the Mortgage Note Trustee or the Senior Subordinated Note Trustee, as applicable, as custodian for The Depository Trust Company ("DTC"), in New York, New York, and registered in the name of DTC or its nominee, in each case for credit to an account of a direct or indirect participant in DTC as described below.

Except as set forth below, the Global Notes may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee.

In addition, transfer of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, which may change from time to time. Beneficial interests in the Global Notes may not be exchanged for Notes in certificated form except in the limited circumstances described below. See "Exchanges of Book-Entry Notes for Certificated Notes."

Exchanges of Book-Entry Notes for Certificated Notes

A beneficial interest in a Global Note may not be exchanged for a Note in certificated form unless (i) DTC (x) notifies the Issuers that it is unwilling or unable to continue as Depository for the Global Note or (y) has ceased to be a clearing agency registered under the Exchange Act, and in either case the Issuers thereupon fail to appoint a successor Depository, (ii) the Issuers, at their option, notify the Mortgage Note Trustee or Senior Subordinated Note Trustee, as applicable, in writing that they elect to cause the issuance of the Notes in certificated form or (iii) there shall have occurred and be continuing an event of default or any event which after notice or lapse of time or both would be an event of default with respect to the Notes. In all cases, certificated Notes delivered in exchange for any Global Note or beneficial interests therein will be registered in the names, and issued in any approved denominations, requested by or on behalf of the Depository (in accordance with its customary procedures). Any certificated Note issued in exchange for an interest in a Global Note will bear the legend restricting transfers that is borne by such Global Note. Any such exchange will be effected through the DTC Deposit/Withdraw at Custodian ("DWAC") System and an appropriate adjustment will be made in the records of the Security Registrar to reflect a decrease in the principal amount of the relevant Global Note.

Certain Book-Entry Procedures for Global Notes

The descriptions of the operations and procedures of DTC that follow are provided solely as a matter of convenience. These operations and procedures are solely within the control of the respective settlement systems and are subject to changes by them from time to time. The Issuers take no responsibility for these operations and procedures and urges investors to contact the system of their participants directly to discuss these matters.

DTC has advised the Issuers as follows: DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the Uniform Commercial Code and a "Clearing Agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC was created to hold securities for its participants ("participants") and facilitate the clearance and settlement of securities transactions between participants through electronic book-entry changes in accounts of its participants, thereby eliminating the need for physical transfer and delivery of certificates. Participants include securities brokers and dealers, banks, trust companies and clearing corporations and may include certain other organizations. Indirect access to the DTC system is available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly ("indirect participants").

DTC has advised the Issuers that its current practice, upon the issuance of the Global Note, is to credit, on its internal system, the respective principal amount of the individual beneficial interest represented by such Global Notes to the accounts with DTC of the participants through which such

interests are to be held. Ownership of beneficial interests in the Global Notes will be shown on, and the transfer of that ownership will be effected only through, records maintained by DTC or its nominees (with respect to interests of participants) and the records of participants and indirect participants (with respect to interests of persons other than participants).

As long as DTC, or its nominee, is the registered Holder of a Global Note, DTC or such nominee, as the case may be, will be considered the sole owner and Holder of the Mortgage Notes or Senior Subordinated Notes, as applicable, represented by such Global Note for all purposes under the Mortgage Note Indenture and the Mortgage Notes or the Senior Subordinated Note Indenture and the Senior Subordinated Notes, as applicable. Except in the limited circumstances described above under "--Exchanges of Book-Entry Notes for Certificated Notes," owners of beneficial interests in a Global Note will not be entitled to have any portions of such Global Note registered in their names, will not receive or be entitled to receive physical delivery of Notes in definitive form and will not be considered the owners or Holders of the Global Note (or any Notes represented thereby) under the applicable indenture or Notes.

Investors may hold their interests in the Global Note directly through DTC, if they are participants in such system, or indirectly through organizations which are participants in such system. The depositories, in turn, will hold such interests in the Global Note in customers' securities accounts in the depositories' names on the books of DTC. All interests in a Global Note will be subject to the procedures and requirements of DTC.

The laws of some states require that certain persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer beneficial interests in a Global Note to such persons may be limited to that extent. Because DTC can act only on behalf of its participants, which in turn act on behalf of indirect participants and certain banks, the ability of a person having beneficial interests in a Global Note to pledge such interest to persons or entities that do not participate in the DTC system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests.

Payments of the principal of, premium, if any, and interest and Liquidated Damages, if any, on Global Notes will be made to DTC or its nominee as the registered owner thereof. Neither the Company, Venetian, the Mortgage Note Trustee, the Senior Subordinated Note Trustee nor any of their respective agents will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in the Global Notes or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

The Issuers expect that DTC or its nominee, upon receipt of any payment of principal or interest in respect of a Global Note representing any Notes held by it or its nominee, will credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of such Global Note for such Notes as shown on the records of DTC or its nominee. The Issuers also expect that payments by participants to owners of beneficial interests in such Global Note held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers registered in "street name." Such payments will be the responsibility of such participants. None of the Company, Venetian or the Mortgage Note Trustee or the Senior Subordinated Note Trustee will be liable for any delay by DTC or any of its participants in identifying the beneficial owners of the Notes, and the Issuers and the Mortgage Note Trustee and the Senior Subordinated Note Trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee as the registered owner of such Notes for all purposes.

Interests in the Global Notes will trade in DTC's Same-Day Funds Settlement System and secondary market trading activity in such interests will therefore settle in immediately available funds, subject in all cases to the rules and procedures of DTC and its participants. Transfers between participants in DTC will be effected in accordance with DTC's procedures, and will be settled in same-day funds.

DTC has advised the Issuers that it will take any action permitted to be taken by a holder of Mortgage Notes or Senior Subordinated Notes only at the direction of one or more participants to show accounts with DTC interests in the Global Notes are credited and only in respect of such portion of the aggregate principal amount of the Notes as to which such participant or participants has or have given such direction.

However, if there is an Event of Default under the Mortgage Notes or the Senior Subordinated Notes (each as defined above), DTC reserves the right to exchange the Global Notes for legended Notes in certificated form, and to distribute such Notes to its participants.

Although DTC has agreed to the foregoing procedures in order to facilitate transfers of beneficial ownership interests in the Global Notes among participants of DTC, it is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. None of the Company, Venetian, the Mortgage Note Trustee, the Senior Subordinated Note Trustee, nor any of their respective agents will have any responsibility for the performance by DTC, or their participants or indirect participants, of their respective obligations under the rules and procedures governing their operations, including maintaining, supervising or reviewing the records relating to, or payments made on account of, beneficial ownership interests in Global Notes.

DESCRIPTION OF DISBURSEMENT AGREEMENT

The Issuers, the Mall Construction Subsidiary, the Mortgage Note Trustee, The Bank of Nova Scotia, as the Bank Agent, the Mall Construction Lender, The Bank of Nova Scotia, as the Disbursement Agent, and the HVAC Provider have entered into the Disbursement Agreement. The following summary of the material provisions of the Disbursement Agreement does not purport to be complete and is qualified in its entirety by reference to the Disbursement Agreement, including the definitions therein of certain terms used below. Capitalized terms that are used but not otherwise defined in this Prospectus have the meanings assigned to them in the Disbursement Agreement. For purposes of this "Description of Disbursement Agreement," and the term "Company" refers to Las Vegas Sands, Inc., Venetian Casino Resort, LLC and the Mall Construction Subsidiary, collectively, and not to any of their respective subsidiaries. Although the FF&E Lenders will not be parties to the Disbursement Agreement, the funding conditions with respect to the FF&E Credit Facility are substantially similar to those set forth in the Disbursement Agreement; provided, however, that the FF&E Credit Facility include additional funding conditions to the effect that the FF&E Lenders are not obligated to advance funds under the FF&E Credit Facility: (a) until the Company can demonstrate that the Casino Resort will be opened within the succeeding 8 months; and (b) if the Expo Center is closed for 30 consecutive days unless closure results from a casualty and the Company is able to demonstrate that the resulting damage can be repaired by November 1, 1999 (or by January 31, 2000 with respect to casualty events occurring after November 1, 1998). See "Description of Certain Indebtedness--FF&E Credit Facility." A copy of the Disbursement Agreement has been filed with the Commission as an exhibit to the Registration Statement.

General

The Disbursement Agreement sets forth the material obligations of the Company to construct and complete the Casino Resort and establishes a line item budget for the Casino Resort and a schedule for construction of the Casino Resort. The Disbursement Agreement also establishes the conditions to, and the relative sequencing of, the making of disbursements from the cash portion of the Equity Contribution, the proceeds from the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and the funding commitment of the HVAC Provider, and establishes the obligations of the Mortgage Note Trustee, the Bank Agent, the Mall Construction Lender and the HVAC Provider to make disbursements under their respective funding commitments upon satisfaction of such conditions. The Disbursement Agreement further sets forth (i) the mechanics for allocating disbursement requests among the funding sources, (ii) the mechanics for approving change orders and amendments to the Project Budget and schedule during the construction period, (iii) certain representations, warranties, covenants and events of default that are common to the various credit facilities, (iv) the conditions for release of the Phase II Land and the Mall Collateral from the lien of the Collateral Documents, and (v) the conditions to the exercise of the Disbursement Agent's right to draw on the irrevocable, stand-by letters of credit furnished by the HVAC Provider if the HVAC Provider does not comply with its funding obligations set forth in the Disbursement Agreement.

The Disbursement Agreement provides that the Company is only permitted to use the proceeds of the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and the cash portion of the Equity Contribution to pay for Project Costs related to the Casino Resort, excluding the HVAC Equipment and the Specified FF&E; provided, however, that (a) after the funding commitment of the HVAC Provider has been fully utilized, the Company will be permitted to use proceeds of the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and all cash equity contributions to pay costs related to the HVAC Equipment if the Company can demonstrate that it has sufficient funds (net of a specified amount of contingency reserves but including certain lending commitments and amounts available under the Completion Guaranty) available to complete the Casino Resort, and (b) the Company will be permitted to use proceeds of the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and all cash equity contributions to pay costs related to the Specified FF&E if the items of Specified FF&E that will be acquired with such proceeds will not be subject to a lien in favor of any Person other than the Bank Agent, the Mall Construction Lender and the Mortgage Note Trustee and if the Company can demonstrate that it has sufficient funds (net of a specified amount of contingency reserves but including certain lending commitments and amounts available under the Completion Guaranty) available to complete the Casino Resort.

Funding Order

The Disbursement Agreement sets forth the sequencing order in which funds from the various sources will be made available to the Company.

All disbursement requests permitted to be made from the proceeds of the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and cash equity contributions shall be funded in the following sequence: (i) first, from the cash equity contributions and certain other cash amounts received by the Company and on deposit from time to time in the Company's Funds Account (including the proceeds of the Senior Subordinated Notes), until exhausted,
(ii) then, pro rata from proceeds of the Mortgage Notes, the Bank Credit Facility, and the Mall Construction Loan Facility. The Disbursement Agreement also provides that the Company is only permitted to use proceeds of the funding commitment of the HVAC Provider to pay for Project Costs related to the HVAC Equipment.

Construction of the Casino Resort commenced in April 1997, and the Company has incurred significant costs in connection with the Casino Resort prior to the Offering. Pursuant to the Disbursement Agreement, the Construction Consultant confirmed that such costs were incurred within the parameters set forth in the approved Project Budget.

Accounts

In order to implement the funding of disbursements, the Disbursement Agreement calls for the establishment of certain accounts, each of which is or shall be, pursuant to a Control Account Agreement, subject to a security interest in favor of the lenders under the Bank Credit Facility and the Mall Construction Loan Facility and the Mortgage Note Holders (provided that (i) the Mortgage Notes Proceeds Account is subject to a security interest in favor of the Mortgage Note Holders only and (ii) the Mall Construction Proceeds Account shall be owned by the Mall Subsidiary and pledged to the Mall Subsidiary's lenders). Such accounts include the following:

Company's Funds Account

The net proceeds of the Senior Subordinated Notes and the cash portion of the Equity Contribution and all other contributions required to be made by or on behalf of the Company (except to the extent used to (i) pay Project Costs incurred prior to the Issuance Date and (ii) repay the Construction Loan), including contributions made pursuant to the Completion Guaranty, were deposited into the Company's Funds Account. Subject to certain exceptions, there shall also be deposited into the Company's Funds Account all amounts received by the Company in respect of casualty and liquidated damages insurance policies, liquidated or other damages under the Construction Management Contract, the Construction Management Contract Guaranty, the P&O Guaranty and certain other contracts, in each case, prior to final completion of the Casino Resort. Amounts on deposit in the Company's Funds Account are or shall be held in escrow and invested in cash or Cash Equivalents by the Disbursement Agent until transferred, from time to time on each disbursement date, to the Disbursement Account for the payment of Project Costs. Investment income from amounts on deposit in the Company's Funds Account shall be deposited therein.

Mortgage Notes Proceeds Account

The net proceeds of the Mortgage Notes were deposited into the Mortgage Notes Proceeds Account. Amounts on deposit in the Mortgage Notes Proceeds Account are held in escrow and invested in cash or cash equivalents by the Disbursement Agent until (i) transferred, from time to time on each disbursement date, to the Disbursement Account for the payment of Project Costs; and (ii) upon the occurrence of certain events, to repurchase a portion of the Mortgage Notes. Investment income from amounts on deposit in the Mortgage Notes Proceeds Account shall be deposited therein.

Disbursement Account

It is anticipated that all disbursements for major Project Costs will be made from the Disbursement Account. On each disbursement date, each of the Bank Agent, Mall Construction Lender and the HVAC Provider will deposit in the Disbursement Account its facility's portion of the requested disbursement. Upon confirming that such deposits have been made, the Disbursement Agent will transfer from the Company's Funds Account and the Mortgage Notes Proceeds Account the portions of the disbursement to be funded therefrom. Amounts in the Disbursement Account will be transferred to the Cash Management Account

and/or applied to pay Project Costs by disbursement to the Construction Manager and other Persons providing goods or services to the Project.

Cash Management Account

The Cash Management Account is designed as an administrative convenience that permits the Company to fund various Project Costs between dates on which funds for major expenditures are released from the Disbursement Account. The Cash Management Account is funded from time to time from the Disbursement Account, using the proceeds of the disbursements. The Company is permitted to withdraw funds from the Cash Management Account to pay Project Costs, from time to time, during the periods between disbursement dates. The balance in the Cash Management Account, which will not be allowed to exceed $6,500,000, will be replenished only upon delivery by the Company of certificates, invoices and other items demonstrating that all previous withdrawals from the Cash Management Account have been applied to pay for Project Costs in accordance with the Project Budget.

Pre-Completion Revenues Account

Until final completion of the Casino Resort, the Company is required to deposit all revenues from operation of the Casino Resort in the Pre-Completion Revenues Account. Amounts from time to time on deposit in the Pre-Completion Revenues Account may be used by the Company to pay expenses related to the operation of the Casino Resort or any portion thereof, including, after opening of the Casino Resort, interest and other debt service. Amounts on deposit in the Pre-Completion Revenues Account, to the extent in excess of amounts used for operating expenses and a specified reserve, may, at the option of the Company, be transferred to the Disbursement Account for the payment of Project Costs. Any amounts so transferred shall (i) reduce the Bank Credit Facility's pro rata portion of the Company's disbursement request and (ii) reduce the total amount of the funding commitment under the Bank Credit Facility at a rate of 75 cents for every $1.00 transferred to the Disbursement Account. At final completion of the Casino Resort (or such earlier date as may be required by the Bank Cedit Facility), any amounts on deposit in the Pre-Completion Revenues Account shall be used to pay any principal that would have become payable on the Bank Credit Facility had amortization of such facility commenced upon opening of the Casino Resort. Any further amounts in the Pre-Completion Revenues Account shall be released to the Company.

Mall Construction Proceeds Account

On the Mall Release Date, the Mall Construction Lender shall fund the remaining unutilized commitment under the Mall Construction Facility into the Mall Construction Proceeds Account. The Mall Construction Proceeds Account will then be transferred to the Mall Subsidiary under the Sale and Contribution Agreement and thereafter become subject to an escrow agreement. Pursuant to such escrow agreement, the Mall Subsidiary will agree to disburse funds from the Mall Construction Proceeds Account in order to fund any remaining construction costs of the Casino Resort.

Funding Conditions

The Disbursement Agreement authorizes disbursement requests only upon the satisfaction of various conditions precedent. These conditions include, among others: (i) delivery by the Company of a disbursement request and certificate certifying as to, among other things, (a) the application of funds to be disbursed, (b) the substantial conformity of construction undertaken to date with the Plans and Specifications, as amended from time to time in accordance with the Disbursement Agreement, (c) the expectation that the Casino Resort will achieve Completion by the Outside Completion Deadline, (d) the accuracy of the Project Budget, as amended from time to time in accordance with the Disbursement Agreement, (e) the sufficiency of remaining funds (net of a specified amount of contingency reserves, but including certain lending commitments and amounts available under the Completion Guaranty or under certain financing commitments) to complete the Casino Resort, and (f) compliance with line item budget allocations (as such allocations may be amended from time to time in accordance with the Disbursement Agreement), taking into account allocations for contingencies; (ii) delivery by the Construction Manager, the Construction Consultant and the Project Architect of certificates corroborating various matters set forth in the Company's disbursement request and certificate; (iii) absence of a Default or Event of Default under the Disbursement Agreement; (iv) each Operative Document being in full force and effect; (v) the representations and warranties of the Company and, to the Company's knowledge, the other parties to the Project Documents, being true and correct in all material respects as if made on such date (except

those that relate to a different date) unless the failure of the foregoing to be the case would not have a material adverse effect; (vi) all of the Security Documents being in full force and effect and all action having been taken as is required to perfect and accord the appropriate priority to the security interests granted under such Security Documents; (vii) receipt by the Company of the governmental approvals required to be in effect at such time; (viii) delivery by the Company to the Disbursement Agent of the acknowledgments of payment and lien releases required under the Disbursement Agreement; (ix) procurement of all required title insurance policies, commitments and endorsements insuring that the Project continues to be subject only to Permitted Liens; (x) the absence of pending or threatened material litigation;
(xi) procurement of all insurance policies required under the Disbursement Agreement; and (xii) all additional Company equity (including amounts required to be funded pursuant to the Completion Guaranty) required to have been funded at such time having been funded. Pursuant to the Intercreditor Agreement and subject to certain limitations, the Bank Agent and the Mall Construction Lender, acting jointly, have the right (without obtaining the Morgage Note Holders' or the HVAC Provider's consent) to waive certain conditions precedent to funding. See "Risk Factors--Sole Stockholder" and "Description of Intercreditor Agreement."

Construction Budget and Schedule

The Disbursement Agreement contains provisions generally designed to assure that amendments to the budget and the Plans and Specifications can be implemented only pursuant to guidelines administered by the Construction Consultant and the Disbursement Agent. For example, the Disbursement Agreement provides that the Company may amend the Project Budget to reallocate amounts among the different Line Item Categories only upon the satisfaction of certain conditions set forth therein. Such conditions generally include delivery by the Company of a certificate describing the proposed amendment, identifying with particularity the availability of funds to pay for any increased Line Item Categories and certifying as to, among other things: (i) the reasonableness of the Project Budget after giving effect to the proposed amendment; (ii) substantial conformity with the Plans and Specifications, as amended from time to time in accordance with the Disbursement Agreement; (iii) the expectation that the Casino Resort will achieve Completion by the Outside Completion Deadline; and (iv) the sufficiency of remaining funds (net of a specified amount of contingency reserves, but including certain lending commitments and amounts available under the Completion Guaranty) to complete the Casino Resort. The conditions to amendment of the Project Budget also include the delivery by the Construction Consultant of certificates corroborating certain matters set forth in the Company's certificate. Increases to any Line Item Category will only be permitted to the extent of (i) Realized Savings in a different Line Item Category, (ii) allocation of previously "unallocated contingency," subject to a specified minimum balance required, from time to time, to be maintained in the "unallocated contingency" line item, (iii) additional Casino Resort revenues on deposit in the Pre-Completion Revenues Account, less certain specified deductions, (iv) additional Company equity and other amounts, to the extent deposited in the Company's Funds Account or (v) an increase in the amount available under the Completion Guaranty to the extent collateral in the amount of such increase is pledged to the Disbursement Agent. The Company may reallocate amounts among line items within the same Line Item Category so long as after giving effect to such reallocation the amounts set forth for each line item are sufficient, in the judgment of the Company and the Construction Consultant, to complete the work covered thereby. The Company may, from time to time, amend the Project Schedule to extend the Outside Completion Deadline, but not beyond the second anniversary of the Issuance Date, by delivering to the Disbursement Agent a certificate describing the amendment and complying with the conditions set forth above with respect to the changes in the Project Budget that will result from the extension of the Outside Completion Deadline. If a casualty or Force Majeure Event occurs, the Company will be permitted to extend the Outside Completion Deadline beyond the second anniversary of the Issuance Date (but in no event beyond the third anniversary of such date) if the Company certifies and the Construction Consultant confirms that such extension is necessary to overcome delays caused by the casualty or Force Majeure Event and the Company satisfies certain other conditions.

Covenants

The Disbursement Agreement contains various affirmative covenants that the Company is obligated to comply with. Such covenants include the following: (i) to use the proceeds of equity contributions, the Offering, the Bank Credit Facility, the Mall Construction Loan Facility and the funding commitment of the HVAC Provider only to pay Project Costs in accordance with the Project Budget and the Disbursement Agreement; (ii) to repay all indebtedness in accordance with its terms; (iii) to maintain its existence and

engage only in the business permitted by the Disbursement Agreement; (iv) to construct the Casino Resort diligently and substantially in accordance with the Plans and Specifications (as the same may be amended from time to time in accordance with the Disbursement Agreement); (v) to construct, maintain and operate the Casino Resort in accordance in all material respects with all applicable laws and procure, maintain and comply with all required governmental approvals in all material respects; (vi) to permit the Mortgage Note Trustee to inspect the Casino Resort and to examine the Company's books and records; (vii) to provide the Mortgage Note Trustee with (a) annual audited and quarterly unaudited consolidated financial statements of the Company and certain other parties and (b) certain construction progress reports and other reports, certificates and notices with respect to the Casino Resort; (viii) to cause to be deposited into the Company's Funds Account all additional required equity as and when required; (ix) to indemnify the Mortgage Note Trustee against claims, expenses, obligations and liabilities incurred or asserted against it in connection with its participation in the transactions contemplated, subject to certain exceptions; (x) to maintain and preserve the liens of the Security Documents and the priority thereof; and (xi) to maintain and comply with the required insurance policies. See "Insurance Requirements."

The Disbursement Agreement also requires the Company to comply with various negative covenants. These covenants prohibit the Company from, among other things: (i) amending, terminating or waiving any right under (a) the Financing Agreements, the Construction Management Contract Guaranty, the P&O Guaranty, the Cooperation Agreement, the Mall Lease, the Master Lease for the Additional Billboard Space, the Casino Lease, the Sale and Contribution Agreement, the HVAC Services Agreement and certain other documents without (subject to certain "safe harbor" exceptions) obtaining (A) the consent of the Bank Agent and the Mall Construction Lender and (B) the consent of the Mortgage Note Trustee or confirmation from the Rating Agencies that such amendment, termination or waiver will not cause a rating agency downgrade of the Mortgage Notes, (b) certain other Project Documents or any governmental approvals if such amendment, termination or waiver could reasonably be expected to result in a Material Adverse Effect or (c) the Construction Management Contract or certain other contracts, unless the Company provides the certifications and complies with the procedures set forth in the Disbursement Agreement; (ii) entering into new Material Project Documents unless the Company provides the certifications and complies with the procedures set forth in the Disbursement Agreement; (iii) implementing any change in the Plans and Specifications or any change order under the Construction Management Contract or other contracts, without obtaining the consents and/or confirmation described in clauses
(i)(a)(A) and (i)(a)(B) above if such change or change order (a) requires an amendment to the Project Budget, unless the Company complies with the procedures for amending the Project Budget, (b) will cause the plans and specifications to no longer comply with certain parameters, (c) could reasonably delay Completion beyond the Outside Completion Deadline, (d) is not permitted by a Project Document, or (e) could reasonably be expected to adversely affect the Company's compliance with legal requirements and governmental approvals; (iv) amending the Project Budget or the project schedule except in accordance with the procedures set forth in the Disbursement Agreement; or (v) releasing any hazardous substance in violation of any legal requirement or governmental approval if it could reasonably be expected to have a Material Adverse Effect.

Release of Phase II Land

The Disbursement Agreement sets forth the conditions upon which the Bank Agent and the Mortgage Note Trustee will release their respective liens on the Phase II Land. Such conditions include the creation of the Phase II Land as a separate legal parcel, delivery of legal opinions to the same effect and the issuance of title insurance endorsements ensuring the priority of the Bank Agent's and the Mortgage Note Trustee's liens on the remaining portions of the Note Collateral.

Transfer of Mall and Final Disbursements

The Disbursement Agreement provides that upon substantial completion of the Casino Resort (i) the Mall will be transferred from the Mall Construction Subsidiary to the Mall Subsidiary, (ii) the Bank Agent and the Mortgage Note Trustee will release their respective liens on the Mall Collateral, (iii) the Issuers will be released from all further obligations under the Mall Construction Loan Facility and any Substitute Tranche B Loan and (iv) the final advance will be made under the Mall Construction Loan Facility in an amount equal to the

remaining unutilized commitment under such facility and be deposited in the Mall Construction Proceeds Account. Such proceeds shall be released to the Company for the payment of retainage amounts and other Project Costs upon satisfaction of certain specified conditions precedent.

Events of Default and Remedies

The Disbursement Agreement provides that each of the following constitutes an Event of Default thereunder: (i) the occurrence of certain "events of default" under the other Financing Agreements; (ii) the failure, from time to time, of remaining funds (net of a specified amount of contingency reserves, but including amounts available under lending commitments and the Completion Guaranty) to be sufficient to complete the Casino Resort on or before the Outside Completion Deadline, if such failure has not been remedied within 30 days; (iii) the failure of any representation or warranty made in any Operative Document by the Company, the Sole Stockholder, or an affiliate of any of them to have been correct when made or deemed made in any material respect, if such failure could reasonably be expected to result in a material adverse effect and if such failure has not been remedied within 30 days after notice thereof; (vi) default by the Company in its compliance with any affirmative or negative covenant contained in the Disbursement Agreement, subject to certain cure periods not to exceed 90 days; (vii) default by the Company or any other party thereto of any Project Document the effect of which reasonably could be expected to have a Material Adverse Effect, subject to reasonable cure and substitution rights by the Company; (viii) failure of any of the Security Documents to be in full force and effect or to provide the secured parties thereunder the security interest intended to be granted therein; (ix) any of the Cooperation Agreement, the HVAC Services Agreement, the Construction Management Contract Guaranty or the P&O Guaranty shall have terminated or otherwise become invalid or illegal; (x) any of the other Project Documents shall have terminated or otherwise become invalid or illegal, subject to reasonable cure and substitution rights by the Company; (xi) the Company ceasing to own the Project Site, the Improvements or certain easements, subject to certain permitted exceptions; (xii) the Company abandoning the Casino Resort or selling or disposing of its interest therein; (xiii) any governmental approvals necessary for the ownership, construction, maintenance, financing or operation of the Project being modified, revoked or cancelled and the effect of such modification, revocation or cancellation is reasonably likely to have a Material Adverse Effect; or (xiv) failure to achieve the Completion Date on or before the Outside Completion Deadline.

The exercise of remedies relating to a Disbursement Agreement Event of Default is subject to the Intercreditor Agreement. Pursuant to the Intercreditor Agreement, the exercise of any such remedies is subject to significant restrictions on actions. See "Description of Intercreditor Agreement." Subject to such restrictions on their exercise, the remedies under the Disbursement Agreement include: (i) termination of the Commitments and the obligations to make any further disbursements; (ii) declaration of any and all amounts outstanding under the Financing Transactions to be immediately due and payable, provided that upon an Event of Default relating to the bankruptcy or insolvency of the Company, all such amounts shall automatically become due and payable; (iii) taking possession of the Casino Resort and completing its construction and/or operating and maintaining the Casino Resort; (iv) setting off and applying all monies on deposit in any account with the Disbursement Agent to the satisfaction of all amounts outstanding under the Financing Transactions, subject to certain priorities; (v) subject to certain limitations, exercising the Company's rights under the various Project Documents; and (vi) exercising any and all rights and remedies available under the Financing Transactions. The Disbursement Agreement will terminate on or about the date on which Completion occurs.

Pursuant to the Intercreditor Agreement and subject to certain limitations, the Bank Agent and the Mall Construction Lender, acting jointly, have the right (without obtaining the Mortgage Note Holders' or the HVAC Provider's consent) to waive certain defaults and funding conditions under the Disbursement Agreement. See "Risk Factors--Sole Stockholder" and "Description of Intercreditor Agreement."

DESCRIPTION OF INTERCREDITOR AGREEMENT

The Bank Agent, the Mall Construction Lender, the Mortgage Note Trustee and the Senior Subordinated Note Trustee have entered into the Intercreditor Agreement setting forth certain agreements among them regarding, among other things, the priority of their claims and interests in the Note Collateral, the Mall Collateral and other assets of the Issuers, the method of decision making for the lenders, the arrangements applicable to actions with respect to approval rights and waivers, certain limitations on rights of enforcement upon default and the application of proceeds of enforcement. The following summary of the material provisions of the Intercreditor Agreement does not purport to be complete and is qualified in its entirety by reference to the Intercreditor Agreement, including the definitions therein of certain terms used below. A copy of the Intercreditor Agreement is available upon request to the Company. A copy of the Intercreditor Agreement has been filed with the Commission as an exhibit to the Registration Statement.

Although the FF&E Lenders and the HVAC Provider are not parties to the Intercreditor Agreement, they have entered into other arrangements with the lenders under the Bank Credit Facility, the Mall Construction Lender and the Mortgage Note Trustee concerning exercise of remedies and other intercreditor issues. See "Description of Certain Indebtedness--FF&E Credit Facility" and "Certain Material Agreements--Agreements Relating to the Casino Resort--HVAC Services Agreement and Related Documents."

Permitted Facility Amendments; Additional Indebtedness

The Intercreditor Agreement provides that the lenders under the Bank Credit Facility and the Mall Construction Lender may amend their respective facilities with the Issuers without the consent of the holders of the Mortgage Notes or the Senior Subordinated Notes so long as such amendment does not: (i) increase the maximum principal amount of Indebtedness under such facility by more than the amounts permitted under the Indentures (which permit an additional $20.0 million in the aggregate to be incurred prior to Mall Release Date and $40.0 million in the aggregate to be incurred after Mall Release Date under such facilities); (ii) except as permitted in the Disbursement Agreement, reduce the unfunded commitment thereunder prior to Completion; (iii) reduce the weighted average life to maturity of the existing indebtedness under the Bank Credit Facility after giving effect to such amendment; and (iv) certain other conditions are met.

The Intercreditor Agreement also provides that, upon the occurrence of a potential event of default or event of default under the Disbursement Agreement:

(i) the lenders under the Bank Credit Facility and the Mall Construction Loan Facility may, without obtaining the consent of the Mortgage Notes or the Senior Subordinated Notes, increase the amounts of their respective credit facilities and/or advance additional loans to the Issuers secured with the same priority as the original commitments so long as: (a) the aggregate maximum amount of any such additional Indebtedness does not exceed $30.0 million; (b) such additional Indebtedness is matched, dollar for dollar, by additional equity investments in the Issuers; (c) all such additional Indebtedness will be used to pay project costs and reasonable fees, costs and expenses incurred in connection with such additional Indebtedness; (d) the applicable margin under the additional Indebtedness will not exceed 7.0% per annum for base rate loans and 8.0% per annum for Eurodollar rate loans; and (e) for any such additional Indebtedness advanced by the lenders under the Bank Credit Facility, no principal payments may be made prior to the later of (i) three years from the Issuance Date and (ii) one year from the date of Completion; and

(ii) with the consent of a majority in principal amount of the holders of the Mortgage Notes and the Senior Subordinated Notes, the Issuers will have the right to issue additional secured indebtedness without the consent of the lenders under the Bank Credit Facility or the Mall Construction Lender so long as the incurrence of such Indebtedness complies with the following conditions:
(a) the maximum principal amount of any additional Indebtedness thereunder does not exceed $50.0 million ("Additional Capital Proceeds"); (b) such additional Indebtedness is matched, dollar for dollar, by additional equity investments in the Issuers; (c) all such additional Indebtedness will be used to pay project costs and reasonable fees, costs and expenses incurred in connection with such additional Indebtedness; (d) such Indebtedness may

be secured by Liens on the Note Collateral (but not the Mortgage Notes Proceeds Account) so long as such Liens are subordinate to the liens in favor of the lenders under the Bank Credit Facility and the Mall Construction Lender and are subordinate or pari passu to liens in favor of the Mortgage Note Trustee and the holders of the Mortgage Notes; (e) no cash payments of principal or interest on any such indebtedness will be permitted until the first to occur of the Mall Release Date and the date the Mall Construction Loan Facility has been repaid in full and after such date no such cash payments of principal will be permitted unless the Bank Credit Facility has been repaid in full; (f) the maturity date for such additional Indebtedness will be at least six months after the maturity date for the Bank Credit Facility; and (g) the holders of any such additional Indebtedness will become parties to the Intercreditor Agreement.

With respect to any Indebtedness advanced by the Mall Construction Lender under the Intercreditor Agreement, it shall be a condition to the incurrence of such Indebtedness that: (i) no principal payments may be made until at least the maturity date of the Mall Construction Loan Facility; and (ii) Mall Construction Lender shall confirm that Venetian and LVSI shall be released from such additional indebtedness at Completion.

The Intercreditor Agreement also provides that the lenders under the Bank Credit Facility, the Mall Construction Lender and the holders of the Mortgage Notes have the right to make additional "protective" advances under their respective loan facilities in order to protect, preserve, repair and maintain the Casino Resort and their respective security interests therein. For example, the Intercreditor Agreement provides that these lenders may make such advances under their loan facilities (i) to pay delinquent taxes or insurance premiums,
(ii) to pay claims that otherwise might have lien priority over the liens of the advancing lender, (iii) to pay Project Costs accruing or payable at any time when disbursements are not permitted under the Disbursement Agreement, and
(iv) to pay amounts necessary to preserve the continued availability of thermal energy services under the HVAC Service Agreements and the continued availability of undisbursed funds under the FF&E Credit Facility. Any amounts so advanced will be secured by the lien granted to secure the loan provided by the advancing lender. In the event such advances are made at a time when the other lenders and/or the HVAC Provider are not permitting disbursements under the Disbursement Agreement because of the existence of an event of default thereunder, and if such event of default is later cured, then the lender providing such advances shall receive credit against the disbursements next due from such lender until such time as the aggregate advances from the Mortgage Notes Proceeds Account, the Bank Credit Facility and the Mall Construction Loan once again are brought back into pro rata balance. The Intercreditor Agreement further provides that any such protective advances made by a lender shall be secured by its respective security interests in the same priority as regular advances made by the lender in accordance with the Disbursement Agreement.

Waiver of Defaults

The Intercreditor Agreement provides that, prior to Completion and subject to certain limitations, the lenders under the Bank Credit Facility and the Mall Construction Loan Facility, acting jointly, may waive (i) any Events of Default under the Disbursement Agreement that arise from acts or events which would not independently constitute defaults or events of default under the Mortgage Notes Indenture or (ii) failure by the Issuers to satisfy any conditions precedent to obtaining disbursements under the Disbursement Agreement; provided, however, that without the consent of the Mortgage Note holders, the lenders under the Bank Credit Facility and the Mall Construction Loan Facility may not waive an Event of Default resulting from, or a condition relating to, implementation of scope changes that, pursuant to the Disbursement Agreement, require either approval of a majority of the holders of the Mortgage Notes or confirmation that the ratings for the Mortgage Notes will not be downgraded. See "Risk Factors--Sole Stockholder" and "Description of Disbursement Agreement--Covenants."

Events of Default; Pre-Completion Remedies

Upon the occurrence of an uncured and unwaived Event of Default under the Disbursement Agreement, each party to the Intercreditor Agreement may declare an event of default under its respective financing agreements and accelerate all obligations due thereunder; provided, however, that, unless the lenders otherwise agree, no party shall be entitled to exercise remedies against the Issuers or with respect to the collateral until the expiration of the Standstill Period (a period of 45 days following the occurrence of the Event of Default), except that: (i) the Mortgage Notes may be paid regularly scheduled interest

payments out of the Mortgage Notes Proceeds Account, and (ii) the lenders under the Bank Credit Facility or the Mall Construction Loan Facility may direct the Disbursement Agent with respect to the enforcement of certain rights of the lenders under the construction and other project contracts. See "Risk Factors--Sole Stockholder." The Standstill Period may be extended by the lenders under the Bank Credit Facility or by the Mall Construction Lender for an additional 15-day period.

Upon expiration of the Standstill Period, each party to the Intercreditor Agreement may exercise remedies against the Issuers, or with respect to the Collateral, except that no party will be entitled to complete a foreclosure against the Collateral or enforce a judgment against the Issuers earlier than
(i) for the lenders under the Bank Credit Facility, 180 days after the Event of Default, (ii) for the Mall Construction Lender, 210 days after the Event of Default, (iii) for the Mortgage Notes, 195 days after the Event of Default,
(iv) for the Additional Capital Proceeds, 210 days after the Event of Default and (v) for the Senior Subordinated Notes, 240 days after the Event of Default. Such dates will be tolled and/or extended for any period of time for which an injunction and/or a bankruptcy stay is in effect. No party to the Intercreditor Agreement is entitled to initiate or join as a petitioning creditor in an involuntary proceeding in bankruptcy against the Issuers (or against any of their Affiliates) until 10 days after the expiration of the Standstill Period.

Events of Default; Post-Completion Remedies

After the Completion of the Casino Resort, each party will be entitled to accelerate its indebtedness and exercise remedies against the Issuers or with respect to the Collateral, in accordance with the terms of its credit facility, subject to the following conditions: (i) each party to the Intercreditor Agreement will be subject to a 45-day Standstill Period; (ii) the Standstill Period may be extended by the lenders under the Bank Credit Facility for an additional 15-day period; (iii) each party to the Intercreditor Agreement will not be entitled to initiate or join as a petitioning creditor in an involuntary proceeding against the Issuers (or against any Affiliate of the Issuers) until 10 days after the expiration of the Standstill Period; and (iv) upon expiration of the Standstill Period, each creditor party to the Intercreditor Agreement shall be entitled to exercise remedies against the Issuers or, with respect to the Collateral, provided that: (a) if the lenders under the Bank Credit Facility accelerate the indebtedness under the Bank Credit Facility, then such lenders will provide the Mortgage Note Indenture Trustee with notice of such acceleration and at least 10 days' the Banks' intent to file the notice of default, and (b) concurrently with any foreclosure by the Mortgage Noteholders, the Mortgage Noteholders (or other purchaser in a foreclosure sale) must repay in full all amounts outstanding under the Bank Credit Facility.

Funding Obligations; Reinstatement

The Disbursement Agreement provides for continued funding following a default under the Disbursement Agreement in certain further limited circumstances so as to protect against deterioration of the construction of the project. More specifically, upon the occurrence of an uncured and unwaived Event of Default or if the Issuers fail to satisfy a condition precedent to disbursement under the Disbursement Agreement which has not been waived, no lender will be required to advance any additional amounts under its financing agreements unless and until all such defaults are cured; provided, however, that, upon the consent of the lenders under the Bank Credit Facility and the Mall Construction Facility acting jointly the lenders will be obligated to advance funds for the following purposes: (i) to make advances which, subject to certain exceptions, may not exceed $25 million in the aggregate to repair, maintain, preserve and protect the Casino Resort, in each case, as certified to be reasonably necessary by the Construction Consultant or to maintain in effect the funding commitment of the FF&E Lenders; and (ii) if the Event of Default or the failure by the Issuers to satisfy the condition to disbursement relating to having sufficient funds available to complete the Casino Resort is cured or waived, then the lenders will be required to make payments in respect of work completed or materials purchased on or prior to the date on which the Disbursement Agent determined that such default occurred or such condition was not satisfied.

The Intercreditor Agreement further provides that notwithstanding the occurrence of an event of default under the Disbursement Agreement and/or acceleration of any indebtedness under the Bank Credit Facility, the Mall Construction Loan or the Mortgage Notes, if prior to the completion of the first permitted foreclosure by any lender with respect to all or any portion of its collateral, all such defaults are

cured or waived and all conditions set forth in the Disbursement Agreement are satisfied or waived, then each lender will be required to reinstate its commitment to make advances under its financing agreements in accordance with the Disbursement Agreement.

Collateral; Priority of Liens

The Intercreditor Agreement provides that the liens and security interests held by each lender in their respective collateral are held with the priority specified therein, notwithstanding (i) the availability of any other collateral to any lender, (ii) the actual date and time of execution, delivery, recording, filing and perfection of any of the Security Documents, and (iii) the fact that any lien or security interest created by any of the Security Documents, or any claim with respect thereto, is or may be subordinated, avoided or disallowed in whole or in part under the Bankruptcy Code or other applicable federal or state law. Each party to the Intercreditor Agreement also has agreed that the obligations due and outstanding under each credit facility shall include all principal, additional advances permitted thereunder, protective advances made by such party to protect or preserve the Casino Resort, its security interest or its collateral, interest, default interest, LIBOR breakage and swap breakage, post petition interest and all other amounts due thereunder, for periods before and for periods after the commencement of any such proceedings, even if the claim for such amounts is disallowed pursuant to applicable law.

After the closing of the Offering and the Financing Transactions, Venetian granted the Mall Construction Lender a first lien on its fee ownership of the Mall Parcel. Because the Mall Parcel is not yet a separate legal and tax parcel, this lien (the "Mall Fee Lien") was recorded in the real estate and county records against the entire Project Site, and is a recorded lien on the Note Collateral. The Intercreditor Agreement therefore provides that the Mall Fee Lien is initially subordinate to the liens of the Bank Credit Facility and the Mortgage Notes on the Note Collateral. Upon the recordation of the subdivision of the Project Site and creation of the Mall Parcel as a separate legal and tax parcel, ownership of the Mall Parcel (subject to the Mall Fee Lien) will, pursuant to the Mall Lease, be transferred to the Mall Construction Subsidiary, at which point the Mall Fee Lien shall become part of the Mall Construction Lender's first lien on all of the Mall Collateral (and the Mall Lease shall terminate). In order to further clarify such first lien priority, the Intercreditor Agreement provides that at such time as the subdivision of the Project Site occurs, the liens on the Mall Collateral held by the Mortgage Notes and the Bank Credit Facility will become subordinate to the Mall Fee Lien. Upon the transfer by Mall Construction Subsidiary of the Mall to Mall Subsidiary, the Mall Construction Lender shall cease to be a party to the Intercreditor Agreement.

Each of the Bank Agent and the Mall Construction Lender have agreed that without the consent of the other that it will not assign or transfer all or any portion of its credit facility except to an eligible assignee under the Bank Credit Facility. The holders of the Mortgage Notes and the Subordinated Notes may each assign or transfer their respective interests in such Notes in accordance with the provisions of the Mortgage Notes Indenture and the Subordinated Notes Indenture, as applicable. An eligible assignee or the holder of any refinancing indebtedness as the case may be, will be bound by the terms and provisions of the Intercreditor Agreement and will continue to apply all such obligations to the holders thereof, notwithstanding such transfer, assignment or refinancing.

INSURANCE REQUIREMENTS

The insurance requirements for the Casino Resort are set forth in the Cooperation Agreement and bind the Issuers and the other owners of the properties that comprise the Casino Resort and the Expo Center, and, subject to certain exceptions, such owners' successors and assigns. See "Certain Material Agreements--Cooperation Agreement." The following summary of the material provisions of the insurance requirements does not purport to be complete and is qualified in its entirety by reference to the Cooperation Agreement. A copy of the Cooperation Agreement has been filed with the Commission as an exhibit to the Registration Statement.

The Issuers believe that the insurance requirements set forth in the Cooperation Agreement provide commercially appropriate protections against insurable risks that could arise in connection with the construction and operation of the Casino Resort and the operation of the Expo Center. These insurance requirements are summarized below.

Liability Insurance

The Cooperation Agreement provides that each of Venetian and Interface shall maintain the following types of insurance coverages, to the extent obtainable on commercially reasonable terms: (i) Commercial general liability insurance, with primary coverage limits of no less than $1.0 million per occurrence and a $2.0 million aggregate limit; (ii) Automobile liability insurance, with limits of no less than $1.0 million per accident; (iii) Statutory workers compensation insurance and employers' liability or stop gap liability with a limit of not less than $1.0 million; (iv) Umbrella Excess Liability Insurance of not less than $100.0 million per occurrence and in the aggregate; and (v) such additional insurance as an insurance trustee appointed under the Cooperation Agreement (the "Insurance Trustee") may reasonably request. The insurance for the Casino Resort will be purchased under blanket policies for (i) the Hotel and Casino, (ii) the Mall, and (iii) the Expo Center.

Property Damage Insurance for Expo Center

Interface shall maintain: (i) "All risk" business insurance on a replacement value basis on improvements and equipment constituting the Expo Center, subject to an annual limit of $50.0 million for flood and earthquake, including contingent liability from the operation of building laws, demolition costs and increased cost of construction endorsements; (ii) business interruption insurance; (iii) to the extent not covered by the "all risk" business insurance policy, comprehensive boiler and machinery insurance (without exclusion for explosion), in amounts not less than the replacement value of eligible components for coverage; and (iv) such additional insurance as the senior mortgagee on the Expo Center may reasonably request. The senior mortgagee on the Expo Center shall be the first loss payee for all insurance described in this paragraph. Until such time as the existing mortgage liens encumbering the Expo Center have been released, however, the insurance for the Expo Center described in this paragraph must be purchased under policies separate from those for the Hotel, the Casino and the Mall, unless otherwise agreed by the senior existing mortgagee of the Expo Center to the extent required under its presently existing loan documents.

Property Damage Insurance for Casino Resort--Construction Period

Until Completion of the Casino Resort, Venetian shall maintain: (i) from the closing date of the Offering until such time as permanent coverage is placed as set forth below, builder's risk insurance on an "all risk" basis, with flood and earthquake on an "agreed amount" basis and providing full replacement value coverage, subject to an annual limit of $50.0 million for flood and earthquake, but in no event in an amount less than the limit necessary to satisfy other contract requirements; (ii) full replacement value ocean cargo coverage for equipment valued in excess of $500,000; (iii) delay in opening insurance, on an "all risk" basis including machinery breakdown coverage, with limits of insurance equivalent to 12 months projected revenues less non-continuing expenses and a waiting period not in excess of 30 days, and
(iv) contingent business interruption insurance with respect to revenue effects on the Casino Resort of a loss event at the Expo Center (including such a loss event occurring prior to Completion). The Disbursement Agent shall be the first loss payee for the foregoing insurance described in this paragraph. Venetian has purchased an insurance program for itself and the major contractors and subcontractors for the construction project.

Property Damage Insurance for Casino Resort--Following Completion

From and after the date of Completion of the Casino Resort, Venetian shall maintain the following insurance coverage: (i) "all risk" property insurance with flood and earthquake coverage on an "agreed amount" basis providing full replacement value coverage subject to an annual limit of $50.0 million for flood and earthquake, but in no event in an amount less than the limit necessary to satisfy other contract requirements; (ii) business interruption insurance on an "all risk" basis, including boiler and machinery, in an amount necessary to satisfy policy coinsurance conditions, but with no more than a 30 day waiting period and with appropriate limits; and (iii) contingent business interruption insurance, or equivalent coverage with respect to the HVAC Equipment and the Expo Center with appropriate limits.

After Completion of the Casino Resort (and with the consent of the Insurance Trustee and the existing mortgagees on the Expo Center), the insurance described in this paragraph may be procured under single blanket policies for the Casino Resort and the Expo Center.

Insurance by Mall Tenants

Additionally, the Cooperation Agreement requires that Venetian and the Mall Subsidiary require that all major tenants leasing space from Venetian or the Mall Subsidiary procure and maintain pursuant to the terms of their leases certain insurance coverages including without limitation (i) full replacement cost coverage for improvements and personal property, (ii) business interruption insurance, (iii) $5.0 million commercial general liability insurance (or in such lesser amount as may be agreed to by a commercially reasonable owner), and (iv) statutory workers compensation insurance.

General Requirements

All insurance must be obtained from insurance companies rated "A-" or better, with a minimum size rating of "VIII" by Best's Insurance Guide and Key Ratings. Each policy shall waive subrogation against the Insurance Trustee, or the collateral agent under the existing senior mortgage on the Expo Center, any Mortgagee, with an insurable interest, Venetian, the Mall Subsidiary and Interface, and shall provide for at least 30 days notice of cancellation. The owners of the Hotel and Casino, the Mall and the Expo Center also must deliver annual certificates stating that their respective insurance policies comply with the provisions of the Cooperation Agreement. Effective three years from the date of the closing of the Offering, the owners of the Hotel and Casino, the Mall and the Expo Center also must engage an independent insurance consultant to review the insurance requirements of the Casino Resort, the Mall and the Expo Center and to prepare a report setting out its recommendations relating to insurance coverage for the next three years. The insurance consultant's report shall be submitted to the Insurance Trustee, and upon approval by the Insurance Trustee shall, to the extent the recommendations differ from the requirements set forth in the Cooperation Agreement, amend and supersede the applicable provisions of the Cooperation Agreement.

Force Majeure

Although the Company has not obtained insurance to cover all potential events of force majeure that can delay completion, it has obtained various coverages and entered into certain agreements that individually protect against certain force majeure type events. For example, as described above, the Company has obtained earthquake and flood insurance. In addition, the Company has entered into certain agreements with trade unions representing key construction trades pursuant to which such unions have agreed not to strike during construction of the Casino Resort. There can be no assurance, however, that the insurance package arranged for the Casino Resort and the Expo Center will be adequate to cover all risks that the owners may encounter during the construction period or operations.

DESCRIPTION OF CERTAIN INDEBTEDNESS

The following discussion summarizes the material terms of certain material agreements to which LVSI and Venetian are parties, but this summary does not purport to be complete and is qualified in its entirety by reference to the relevant agreements described herein. Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the agreement being described (unless otherwise indicated). Copies of such documents have been filed with the Commission as exhibits to the Registration Statement.

Bank Credit Facility

The Issuers have entered into the Bank Credit Agreement with a syndicate of lenders, The Bank of Nova Scotia, as administrative agent, and Goldman Sachs Credit Partners L.P., as arranger and as syndication agent. The Bank Credit Facility consists of (i) the Term Loans (multiple draw term loans of up to $150.0 million) available for the period commencing upon the Closing Date and ending on the earlier to occur of (a) the Outside Completion Deadline and (b) Completion and (ii) the Revolving Loans (revolving credit loans of up to $20.0 million) available for a period commencing eight months prior to the Opening Date and ending either two years from the initial draw on the Revolving Loans (but in no event later than the second anniversary of the Term Loan Commitment Termination Date). During the construction period, up to $15 million of the Revolving Loans will be available (i) to fund purchases of the Specified FF&E (including deposits) and (ii) to support letters of credit related to the construction of the Casino Resort. Any amounts borrowed to purchase the Specified FF&E will be repaid from the proceeds of the loans under the FF&E Credit Facility. Under the Bank Credit Facility, the aggregate principal amount of the Revolving Loans may be increased to an amount not in excess of $40.0 million to the extent one or more of the Lenders (or an eligible assignee who desires to become a lender) in their sole discretion, elect to increase their commitments with respect to such Revolving Loans in excess of their proportionate share of the initial $20.0 million commitment (or, in the case of an eligible assignee, such eligible assignee commits to fund such excess). The proceeds of the Bank Credit Facility will be utilized for similar purposes as the proceeds of the Notes and will be drawn on a pro rata basis with proceeds of the Notes and the Mall Construction Facility. See "Use of Proceeds."

The Term Loans mature not later than six years from the Closing Date and are subject to quarterly amortization payments which begin on the earlier of
(i) 120 days after the Opening Date, (ii) the Completion Date and (iii) the Outside Completion Deadline. Amortization during the first four quarters following the amortization commencement date will be 3.75% of principal per quarter; during the second four quarters, 5% of principal per quarter; during the third four quarters, 7.5% of principal per quarter; and during the fourth four quarters, 8.75% of principal per quarter. Notwithstanding the foregoing, all revenues received from the operation of any portion of the Casino Resort prior to completion, will be deposited in the Pre-Completion Revenues Account. See "Description of Disbursement Agreement--Accounts--Pre-Completion Revenues Account." Amounts on deposit in the Pre-Completion Revenues Account, to the extent in excess of amounts used for operating expenses and debt service and a specified reserve, may, at the option of the Company, be transferred to the Disbursement Account for the payment of project costs or retained in such account until released in accordance with the Disbursement Agreement. Any amounts so transferred shall (a) reduce the Bank Credit Facility's pro rata portion of the Company's disbursement request and (b) reduce the total amount of the funding commitment under the Bank Credit Facility at a rate of 75 cents for every $1.00 transferred to the Disbursement Account. Upon final completion of the Casino Resort (or, under certain circumstances, an earlier date), any amounts on deposit in the Pre-Completion Revenues Account will be used to pay any principal that would have become payable on the Bank Credit Facility had amortization of such facility commenced upon opening of the Casino Resort and any remaining amounts in such account will be distributed to the Issuers. In no event will the maturity of the Term Loans extend beyond the sixth anniversary of the Closing Date.

Indebtedness under the Revolving Loans matures two years from the initial draw on the Revolving Loans (or if earlier the second anniversary of the Term Loan Commitment Termination Date); provided, however, that, in the event one or more of the lenders (or eligible assignee) elects to extend the maturity date of their portion of the Revolving Loans to a later date, the maturity date of the Revolving Loans portion of the Bank Credit Facility as it relates to any such Lender's (or eligible assignee's) portion may be so extended.

Interest and Fees

All amounts outstanding under the Bank Credit Facility bear interest, at the option of the Issuers (subject to certain limitations) as follows: (A) with respect to the period prior to the Substantial Completion Date, (i) at the Base Rate plus 2.00% per annum; or (ii) at the reserve adjusted Eurodollar Rate plus 3.00% per annum; (B) with respect to outstandings under the Bank Credit Facility for the period between the Substantial Completion Date and ending on the second full fiscal quarter following the Substantial Completion Date, (i) at the Base Rate plus 1.50%; or (ii) at the reserve adjusted Eurodollar Rate plus 2.50% per annum; and (C) with respect to outstandings under the Bank Credit Facility for the period commencing on the second full fiscal quarter following the Substantial Completion Date, at the Base Rate or reserve adjusted Eurodollar Rate, as the case may be, plus the relevant margin based on certain leverage ratios set forth in the Bank Credit Facility loan agreement. For instance, if the range of Leverage Ratios is from 2.5x to 4.0x, then the range for the relevant margin will be 0.25% to 1.5% for Base Rate loans and 1.25% to 2.5% for Eurodollar loans. The leverage ratio of the Company is generally defined as the ratio of total debt to the earnings before interest, taxes, depreciation and amortization of the Company for the last twelve months.

Within 60 days of the closing of the Bank Credit Facility, the Issuers will obtain interest rate protection through interest rate swaps, caps or other similar arrangements against increases in the interest rates with respect to an aggregate nominal amount equal to not less than 50% of the aggregate principal amount of Term Loans outstanding from time to time, such interest rate protection to limit the interest rate on such principal amount to no more than 9% per annum.

Commitment fees equal to 0.50% per annum times the daily average unused portion of the commitment under the Bank Credit Facility shall accrue and will be payable quarterly in arrears.

Security

The obligations of the Issuers and the Mall Construction Subsidiary under the Bank Credit Facility and the guaranty of Mall Construction Subsidiary are secured by first priority liens on the Note Collateral (other than the Mortgage Notes Proceeds Account) and by second priority liens on the Mall Collateral. Upon the subdivision of the Project Site and satisfaction of certain other conditions precedent, the Phase II Land shall be released from the security interest of the Lenders, provided such land is transferred to a wholly-owned indirect subsidiary of the Company. In addition, the Mall Collateral shall be released from the security interest of the Bank Lenders, provided the Mall is transferred to the Mall Subsidiary pursuant the Sale and Contribution Agreement and certain other conditions are met.

Guarantees

The indebtedness under the Bank Credit Facility is guaranteed on a senior basis by Mall Construction Subsidiary, Mall Intermediate Holdings and Phase II Intermediate Holdings and all other Subsidiaries of LVSI and Venetian (other than the subsidiaries which are Special Subsidiaries or Unrestricted Subsidiaries on the Issuance Date).

Termination

The Issuers are required to make mandatory prepayments from certain available cash flow and proceeds including (a) proceeds received by the Issuers and certain subsidiaries as a result of (i) asset sales, (ii) equity offerings by the Issuers and certain subsidiaries, (iii) debt offerings by the Issuers and certain subsidiaries (other than those contemplated by the Bank Loan Facility, including the Offering), (iv) debt offerings and equity offerings of the Mall Subsidiary (to the extent not allocated to refinancing existing debt or to use in the business of the Mall and only if such proceeds are actually distributed to the Issuers or any subsidiary by the Mall Subsidiary) and (v) pension plan reversions, (b) certain cost savings from the construction budget,
(c) excess cash flow and (d) excess insurance or condemnation proceeds. The indebtedness under the Bank Credit Facility may be prepaid at any time.

Covenants

The Bank Credit Facility contains additional negative, affirmative and financial covenants, including, without limitation, the following: (i) restrictions on the ability of the Issuers and certain of their subsidiaries to incur additional indebtedness; (ii) restrictions on the ability of the Issuers and certain of their subsidiaries

to make certain restricted payments (collectively "Bank Restricted Payments");
(iii) restrictions on the ability of LVSI and Venetian to engage in mergers, acquisitions, joint venturers or partnerships for acquisitions; (iv) prohibitions on the grant of negative pledges to any person; (v) minimum fixed charge coverage; (vi) minimum EBITDA; (vii) total debt to EBITDA; (viii) EBITDA to fixed charges; (ix) maximum capital expenditures; (x) minimum net worth;
(xi) prohibitions on liens; (xii) prohibitions on restrictions on distributions by subsidiaries; and (xiii) prohibitions on contingent obligations. With respect to the covenants relating to EBITDA, the Sole Stockholder has the right to cure any deficiencies in EBITDA by contributing cash in the amount of the deficiency up to $15.0 million per quarter, subject to limitation on the exercise of such right to not more than two consecutive quarters. After two consecutive quarters of cash contributions by the Sole Stockholder to cure the deficiencies in EBITDA, the Sole Stockholder may not make any additional contributions to cure any such deficiencies unless the Company is in compliance with its financial covenants in any four-quarter period, without giving effect to any previous cash contributions.

The Bank Credit Facility requires the Issuers to provide the Bank Lenders with financial and certain other information.

Conditions to Availability of Funds

Advances of Term Loans under the Bank Credit Facility are available for the purposes permitted under the Disbursement Agreement and are subject to the satisfaction or waiver of all the conditions to disbursement set forth in the Disbursement Agreement. See "Description of Disbursement Agreement." Advances of Revolving Loans under the Bank Credit Facility are available for working capital purposes and are subject to various conditions set forth in the Bank Credit Facility.

Events of Default

Prior to Completion, "Events of Default" includes all events of default under the Disbursement Agreement, the failure to make payments when due, defaults under other agreements relating to, or instruments of, indebtedness, loss of material licenses or permits (including gaming licenses), loss of material contracts, breaches of representations and warranties, bankruptcy, ERISA, impairment of security interests, cross acceleration to indebtedness of the Mall Subsidiary, the Sole Stockholder makes certain prohibited investments in the Phase II Subsidiary and the Mall Subsidiary, invalidity of guarantees, default under material agreements and change of control (the Sole Stockholder or certain related parties cease to beneficially own and control directly or indirectly at least 70% of the issued and outstanding shares of capital stock of LVSI (with certain exceptions) entitled to vote for the election of members of the board of directors of LVSI or LVSI ceases to own 100% of the equity of Venetian or LVSI and Venetian ceases to own 100% of the equity of each of their subsidiaries (other than Mall Subsidiary, Phase II Subsidiary and any preferred equity in Venetian held by Interface Holding or other affiliates of the Sole Stockholder), or Mall Holdings ceases to own not less than 80% of the equity securities in the Mall Subsidiary or Phase II Holding ceases to own at least 51% of the equity in the Phase II Subsidiary or the sole managing member of Mall Intermediate Holdings, Phase II Intermediate Holdings, Mall Holdings, Mall Subsidiary, Phase II Holdings and Phase II Subsidiary ceases to be LVSI, Venetian or a wholly-owned subsidiary of LVSI or Venetian). After Completion, "Events of Default" will not include defaults or events of default under the Disbursement Agreement.

Mall Construction Loan Facility

LVSI, Venetian and the Mall Construction Subsidiary have entered into the Mall Construction Loan Credit Agreement with the Mall Construction Lender. The Mall Construction Loan Facility consists of two tranches: (i) the Tranche A Loan in the amount of up to $105.0 million, and (ii) the Tranche B Loan in the amount of up to $35.0 million. Borrowings under the Tranche B Loan were available as of the Issuance Date. Borrowings under the Tranche A Loan were available as of the Issuance Date, but will not be drawn until the full funding of the Tranche B Loan. Borrowings under the Tranche B Loan will then be available until the earlier of (a) the Mall Release Date and (b) the Outside Completion Deadline. All indebtedness outstanding under the Mall Construction Loan Facility matures on May 1, 2000, provided that the Issuers shall have the option to extend the maturity of the Mall Construction Loan Facility until November 14, 2000 if, as of May 14, 2000 (i) the Mall Take-out Financing commitments are in full force and effect, (ii) fully executed leases are in place, at the time of exercise of such option, yielding net rental income sufficient to provide a 1.25x debt service coverage ratio on the Tranche A Loan, based on the then current 30-day

LIBOR rate plus 350 basis points and a 25-year amortization period and (iii) certain other conditions are met. Borrowings under the Mall Construction Loan Facility are funded pro-rata with the proceeds of the Bank Credit Facility and Mortgage Notes. Upon Completion of the Casino Resort and the satisfaction of certain other conditions (but not leasing conditions), (i) the indebtedness under the Mall Construction Loan Facility will be either repaid and/or assumed by the Mall Subsidiary in accordance with the Sale and Contribution Agreement and (ii) the Mall Construction Lender will release the Issuers, Mall Construction Subsidiary and Mall Intermediate Holdings from all liability under the indebtedness under the Mall Construction Loan Facility.

Interest and Fees

The annual interest rate on indebtedness outstanding under the Mall Construction Loan Facility is 275 basis points over 30-day LIBOR, provided that effective as of April 10, 1998, if the Mall Parcel is not a separate legal and tax parcel by July 10, 1998, such interest rate shall be 375 basis points over 30-day LIBOR until such time, if any, as the Mall Parcel becomes a separate legal and tax parcel. In the event the term of the maturity is extended as described above, a fee of $375,000 will be payable to Mall Construction Lender.

Security

The indebtedness under the Mall Construction Loan Facility was secured at closing by a first priority lien on all of the Issuers' and their Subsidiaries' right, title and interest in and to (i) the Mall, including the Mall Parcel and all improvements and equipment located thereat or used in connection therewith;
(ii) any reserves established by the Issuers, any of their Restricted Subsidiaries or any of their Special Subsidiaries relating to the Mall; and
(iii) all rents and other income derived from the Mall. With respect to the lien described in clause (i) of the preceding sentence, at closing Venetian granted the Mall Construction Lender a junior lien on its fee ownership of the Mall Parcel (the "Mall Fee Lien"), and the Mall Construction Subsidiary granted the Mall Construction Lender a first lien on its leasehold estate under the Mall Lease. Because the Mall Parcel was not, as of the closing of the Offering, a separate legal parcel, the Mall Fee Lien was recorded in the real estate and county records against the entire Project Site, and so is a recorded lien on the Note Collateral. The Intercreditor Agreement therefore provides that the Mall Fee Lien is initially subordinate to the liens of the Bank Credit Facility and the Mortgage Notes on the Note Collateral. When the Mall Parcel becomes a separate legal and tax parcel, the Mall Lease (and, therefore, the above-described lien on the leasehold estate created by the Mall Lease) will terminate, and ownership of the Mall Parcel will (subject to the Mall Fee Lien), (i) if prior to Completion, be transferred to Mall Construction Subsidiary and (ii) if after Completion, be transferred to the Mall Subsidiary. At this point, the Mall Fee Lien will be a first priority lien on the Mall Parcel.

Covenants and Events of Default

Except for covenants related to the Mall Collateral, the covenants in the Mall Construction Loan Facility are similar to those in the Bank Credit Agreement (except that there are no financial covenants). In addition, the events of default under the Mall Construction Loan Facility are generally similar to those in the Bank Credit Facility.

Guaranties

The indebtedness under the Mall Construction Loan Facility is guaranteed by Mall Intermediate Holdings on a senior basis.

Conditions to Availability of Funds

Advances under the Mall Construction Loan Facility to the Company and/or the Construction Manager are subject to the satisfaction or waiver of all of the conditions to disbursement set forth in the Disbursement Agreement. See "Description of the Disbursement Agreement." In addition, advances under the Mall Construction Loan Facility are conditioned upon the execution and delivery of the commitments relating to the Mall Take-out Financings.

Sole Stockholder Guaranty of Mall Construction Loan Facility

The Sole Stockholder has guaranteed up to $35.0 million of indebtedness outstanding under Tranche B of the Mall Construction Loan Facility. The Sole Stockholder's obligations under such guaranty are collateralized by a cash collateral account. If any amounts are drawn on the guaranty of Tranche B of the

Mall Construction Loan Facility, the Sole Stockholder will have the right to elect to treat such amounts as a subordinated loan (the "Substitute Tranche B Loan") from the Sole Stockholder to Venetian and the Mall Construction Subsidiary. The Substitute Tranche B Loan will be subordinated in right of payment to indebtedness under the Bank Credit Facility, the Mall Construction Loan Facility and the Mortgage Notes. If the Sole Stockholder makes this election: (i) the interest rate will not exceed that which was applicable to Tranche B of the Mall Construction Loan; (ii) there will be no scheduled principal amortization for the Substitute Tranche B Loan and the Substitute Tranche B Loan will mature on the same date as the Senior Subordinated Notes;
(iii) irrespective of the stated interest payment schedules, no payments will be permitted on the Substitute Tranche B Loan unless all payments then due on any debt secured by the Mall Collateral on a senior basis at that time have been paid in full, and any cash payments that are due but that are prohibited will accrue; (iv) the Substitute Tranche B Loan will, until completion and transfer of the Mall to the Mall Subsidiary, be pari passu in right of payment with the Senior Subordinated Notes; (v) the Substitute Tranche B Loan provides that Venetian and the Mall Construction Subsidiary will be released from further liability with respect to the Substitute Tranche B Loan upon satisfaction of the conditions to the release of the Mall Collateral and the Substitute Tranche B Loan will be assumed by the Mall Subsidiary; and (vi) the loan documents will contain certain subordination provisions (such as no right to object to modifications of debt secured on a senior basis by the Mall Collateral, and no right to exercise remedies without consent from the senior lenders and the holders of the Senior Subordinated Notes).

FF&E Credit Facility

The FF&E Credit Facility is a $97.7 million multiple draw facility available to fund the acquisition and installation of the Specified FF&E. The Specified FF&E will be divided into two groups of assets: (i) the furniture, certain fixtures, and equipment (approximately $90.7 million) and (ii) an electrical substation (approximately $7.0 million). The FF&E Credit Facility will be secured by a first priority lien on the Specified FF&E. The FF&E Credit Facility consists of a multiple draw interim loan prior to completion of the Casino Resort (the "FF&E Interim Loan") and a term loan for a period of 60 months after completion of the Casino Resort (the "FF&E Term Loan"). If the FF&E Credit Facility is not fully funded on the Project Construction Completion Date, the unused portion of the commitment under the FF&E Credit Facility may be drawn in whole and placed in a cash collateral account and used to fund the purchase and installation of Specified FF&E for a period of 120 days, with any proceeds remaining in such cash collateral account after such 120-day period being used by the FF&E Lenders to prepay an equivalent portion of the outstanding borrowings at such time. Borrowings under the FF&E Credit Facility may be made commencing (a) eight months prior to the anticipated opening date, if the Issuers elect to pay Interim Loan interest on a current basis or (b) three months prior to the anticipated construction completion date, if the Issuers elect to accrue Interim Loan interest (the "Interim Loan Commencement Date"). A portion of the initial draw down is expected to be used to repay amounts drawn under the Bank Credit Facility or other funds subject to the Disbursement Agreement that were used for the purchase, construction and installation of the Specified FF&E prior to the Interim Loan Commencement Date. Upon the satisfaction of certain conditions, the FF&E Lenders have agreed to certify to the Disbursement Agent and the Bank Agent that any Specified FF&E acquired prior to the Interim Loan Commencement Date is eligible collateral under the FF&E Credit Facility.

Interest and Amortization

Interest on the FF&E Interim Loan, if paid on a current basis, will be due quarterly in arrears at a floating rate equal to 30-day reserve adjusted LIBOR plus 375 basis points or at the Base Rate (the greater of the Prime Rate or the Federal Funds Rate plus 50 basis points) plus 100 basis points, whichever the Issuers elect. Subject to certain circumstances, the Issuers may elect to accrue FF&E Interim Loan interest, and such interest will accrue based on the foregoing rates.

Upon the same date as the Basic Loan Commencement Date, but subject to certain conditions, the FF&E Interim Loan converts to the FF&E Basic Loan, a sixty-month term loan with quarterly amortization payments. Amortization on the FF&E Basic Loan will be 3% of principal for the first four quarters and 5.5% of principal for the last 16 quarters. The Issuers are required to make mandatory prepayments of principal in the event of certain asset sales and casualty events (subject to permitted reinvestments and equipment replacement purchases). Subject to certain limited exceptions, the FF&E Credit Facility may not be repaid prior to the first anniversary of the Basic Loan Commencement Date. Thereafter, the Issuers may prepay

such indebtedness subject to a penalty fee of 1.5% (if the loan is terminated between the first and second anniversaries of the Basic Loan Commencement Date) and 1.0% (if the loan is terminated between the second and fourth anniversaries of the Basic Loan Commencement Date).

Interest on the FF&E Basic Loan is a floating monthly rate calculated at the higher of (a) the reserve-adjusted 30-day LIBOR plus 375 basis points or
(b) the eurodollar interest rate margin in effect on the Bank Credit Facility plus 125 basis points.

Conditions to Availability of Funds

Advances under the FF&E Credit Facility are subject to certain conditions, including the following: (i) no event of default exists and is continuing under any of the Financing Agreements or under any Material Contract or under any other agreement of the Issuers involving obligations aggregating or projected to aggregate $5.0 million or more (provided, that the condition with respect to any Material Contract or other agreement equalling or exceeding the $5.0 million threshold will be deemed satisfied if the defaulting party is other than the Issuers or an affiliate thereof and such Material Contract or other agreement has been replaced with a similar agreement with a replacement party),
(ii) (a) in the case of interim loans, the Project Construction Completion Date will be anticipated to occur within the next succeeding eight months, and (b) in the case of the basic loan, the Project Construction Completion Date will have occurred, (iii) the Expo Center will not have been closed for a period of more than 30 consecutive days from the commitment date to the date of the advance (subject to certain exceptions for casualty events if the Expo Center is capable of being restored within a specified time period), (iv) there shall not be any material pending or threatened litigation relating to the Casino Resort which would result in any material adverse change in the economic prospects of the Casino Resort or in the financial condition or operations of the Issuers and their subsidiaries, taken as a whole and there shall not be any material pending or threatened litigation relating to the Equipment Loan Facility, (v) there shall be no default or event of default under the FF&E Credit Facility, (vi) other conditions for advances similar to those contained in the Disbursement Agreement, (vii) filing of customary financing statements,
(viii) delivery of a customary legal opinions, and (ix) execution of an agreement among the Company, the FF&E Lenders and the Construction Consultant pursuant to which the Construction Consultant will provide project monitoring services to the FF&E Lenders.

Covenants and Events of Default

Except for covenants related to the Specified FF&E, the covenants in the FF&E Credit Facility are similar to those in the Bank Credit Agreement (including financial covenants such as minimum net worth, minimum EBITDA, minimum fixed charge ratio, leverage ratio and restrictions on capital expenditures). In addition, the events of default under the FF&E Credit Facility are generally similar to those in the Bank Credit Facility.

Exercise of Remedies

The FF&E Lenders have entered into an intercreditor agreement with the Bank Agent, the Mortgage Note Trustee, the Mall Construction Lender and General Electric Capital Corporation as part of the FF&E Credit Facility (the "FF&E Intercreditor Arrangement"). Under the FF&E Intercreditor Arrangement, the FF&E Lenders have agreed that following an event of default during the period prior to the Interim Loan Funding Commencement Date (the "Pre-funding Period") that they will refrain from exercising certain remedies against their collateral for a period of up to 120 days. Following the occurrence of an event of default under the FF&E Credit Facility during the period from the Interim Loan Commencement Date until the Basic Loan Commencement Date (the "Funding Period"), the FF&E Lenders have agreed to refrain from exercising certain remedies against their collateral for a period of up to 180 days so long as (i) the event of default in question is susceptible of cure, (ii) all overdue interest, fees and payments under the FF&E Credit Facility are brought current and all interest, fees and payments under the FF&E Credit Facility are paid currently on a monthly basis and (iii) in order to extend the standstill period beyond the 120th day after the event of default, the only uncured event of default at such time must be the failure to comply with "in-balance" requirement of the FF&E Credit Facility and the FF&E Lenders further must receive a written proposal demonstrating that a cure of such default on or before the end of the 180-day standstill period will occur. The FF&E Lenders have agreed to recommence advancing funds under the FF&E Credit Facility if the event of default is cured during the standstill period and the indebtedness under the FF&E Credit Facility has not been accelerated. Finally, during the period following the Basic Loan Commencement Date

(the "Basic Loan Period"), the FF&E Lenders have agreed to a standstill period of 30 days. No more than two standstill periods may be commenced during the Funding Period and only one standstill period may be commenced in either the Pre-funding Period or the Basic Loan Period. The standstill periods will terminate under certain circumstances including if any collateral is the subject of any material damage, loss, removal, deterioration or disposition. Furthermore, such standstill periods will not apply if the event of default involves a bankruptcy or insolvency proceeding. Finally, the FF&E Lenders are not obligated to continue the standstill period if the Casino Resort does not open by November 1, 1999 or if completion is not likely to occur by November 1, 1999 (subject to extension to January 31, 2000 if a certain casualty event occurs and certain conditions are met).

Mall Take-out Financing Commitments

Upon the completion of the Casino Resort and the satisfaction of certain other conditions (but not any leasing condition), pursuant to the Sale and Contribution Agreement, the Mall Construction Subsidiary will transfer the Mall Collateral to the Mall Subsidiary. Following such transfer, all indebtedness under the Mall Construction Loan Facility will be repaid and the Mall Collateral will not be available as security for the holders of the Mortgage Notes or the indebtedness under the Bank Credit Facility. The cash proceeds received by the Mall Construction Subsidiary as a result of such transaction, if any, must be used to repay the indebtedness under the Mall Construction Loan Facility. See "Certain Material Agreements--Sale and Contribution Agreement." GSMC and the Tranche B Take-out Lender separately have agreed to provide Mall Take-out Financings to provide funds to the Mall Subsidiary to meet its obligations under the Sale and Contribution Agreement.

GSMC has committed to provide the Tranche A Take-out Financing in an amount of up to $105.0 million to the Mall Subsidiary subject to completion of the Casino Resort and certain other conditions. The indebtedness under the Tranche A Take-out Financing will be secured by a first lien on the Mall Collateral and will bear interest at a floating rate equal to LIBOR plus 3.5%; provided that if, as of the consummation of the Tranche A Take-out Financing, the Mall Parcel is not a separate legal and tax parcel, such indebtedness shall bear interest at a floating rate equal to LIBOR plus 5.0% until such time, if any, that the Mall Parcel is a separate legal and tax parcel. The Tranche A Take-out Financing will include certain customary covenants including limitations on indebtedness, restricted payments and liens. In the event that the Debt Service Coverage Ratio (as defined in the Tranche A Take-out Financing agreements) is less than 1.25 for a period of six consecutive months, all rents shall be payable into a cash collateral account and may not be distributed to the Company or any of its subsidiaries without the consent of GSMC. The indebtedness under the Tranche A Take-out Financing must be repaid within three years and is prepayable (without penalty) at any time. The Sole Stockholder has agreed to guarantee, on an unsecured basis, $20.0 million of indebtedness under the Tranche A Take-out Financing. The Mall Subsidiary and the Sole Stockholder have agreed to pay GSMC a non-refundable commitment fee payable in two installments, the first of which was paid on the date of the Offering, and the second of which is due on the first anniversary of the date of the Offering. The proceeds from the Tranche A Take-out Financing will be used to partially finance the purchase price under the Sale and Contribution Agreement, which, in turn, will be used to partially repay the indebtedness outstanding under the Mall Construction Loan Facility.

GSMC's commitment to provide the Tranche A Take-out Financing expires November 1, 2000.

In addition to certain escrows in respect of tenant improvement costs, leasing commissions, real estate taxes and insurance premiums which must be funded as a condition to the funding of the Tranche A Take-out Financing, the Mall Subsidiary will be required to fund an operating expense shortfall reserve if a certain financial test is not satisfied.

The Tranche B Take-out Lender is providing the Tranche B Take-out Financing to the Mall Subsidiary. The Tranche B Take-out Lender's total commitment is $35.0 million and is unsecured, provided that to the extent the Mall Construction Lender has not drawn on the Sole Stockholder's $35.0 million collateralized guaranty of the Mall Construction Loan Facility, such collateralized guaranty shall secure the Tranche B Take-out Lender's commitment. The terms of the Tranche B Take-out Financing are generally the same as the terms of the Tranche A Take-out Financing, except that the Tranche B Take-out Financing (i) will be subordinated to the Tranche A Take-out Financing and will be secured by a second mortgage on the Mall Collateral, (ii) will not permit cash interest payments unless no event of default exists under the Tranche A Take-out Financing

and all payments on the Tranche A Take-out Financing have been paid when due (and all operating expenses have been paid and all reserves required under the Tranche A Take-out Financing have been funded), and (iii) will have an initial term of five years (which term Mall Subsidiary will be entitled to extend). If any interest payments on the Tranche B Take-out Financing are not paid, then such interest will accrue. The Tranche B Take-out Financing documents will provide that the holder thereof may not take enforcement action under such documents without GSMC's consent until 90 days after the Tranche A Financing has been paid in full.

Notwithstanding any of the foregoing, if the Mall Construction Lender increases the principal amount of its loan above $140.0 million (but not in excess of $170.0 million) in accordance with the terms of the Intercreditor Agreement, then such loan increase shall remain outstanding after the Mall Collateral is transferred to the Mall Subsidiary and shall be assumed by the Mall Subsidiary (the "Mezzanine Loan"). The Mezzanine Loan will be subordinate to the Tranche A Take-out Financing and superior to the Tranche B Take-out Financing and will be secured by a second mortgage on the Mall Collateral. If the Mezzanine Loan is made, then (X) the Tranche B Take-out Financing will be secured by a third mortgage on the Mall Collateral and (Y) until the aggregate principal amount of the Tranche A Take-out Financing, the Mezzanine Loan and the Tranche B Take-out Financing is $140.0 million, the Mall Subsidiary will be required to use all revenue from the Mall Collateral (after the payment of operating and capital expenses, interest on the Tranche A Take-out Financing, certain distributions to pay income taxes and the funding of certain reserves) to prepay principal of the Tranche A Take-out Financing.

LVSI, Venetian, the Mall Subsidiary, the Mall Construction Subsidiary and the Sole Stockholder (the "Borrower Parties") have entered into the Tri-Party Agreement with GSMC and the Mall Construction Lender. Under the Tri-Party Agreement, GSMC (i) covenants, for the benefit of the Mall Construction Lender, to perform its obligations under its commitment to provide the Tranche A Take-out Funding and (ii) pre-approves, for the benefit of the Mall Subsidiary and the Mall Construction Lender certain of the conditions to the funding of the Tranche A Take-out Financing. Also, all parties to the Tri-Party Agreement have agreed that, in the event Mall Construction Lender, or its designee, obtains title to the Mall, by foreclosure or otherwise, Mall Construction Lender, or its designee, as the case may be, upon notice to GSMC, may assume the Mall Subsidiary's rights under the Tranche A Take-out Financing commitment. The Tri-Party Agreement permits the Mall Subsidiary to terminate GSMC's commitment to provide the Tranche A Take-out Financing, so long as (i) such commitment is replaced with a commitment from an institutional or other lender reasonably satisfactory to the Mall Construction Lender that does not terminate earlier than the termination date of GSMC's commitment and does not contain any conditions not contained in GSMC's commitment, and (ii) such replacement Tranche A Take-out Lender executes and delivers an agreement substantially similar to the Tri-Party Agreement.

CERTAIN MATERIAL AGREEMENTS

The following discussion summarizes the material terms of certain material agreements to which one or more of the parties constituting the Company is a party, but this summary does not purport to be complete and is qualified in its entirety by reference to the relevant agreements described herein. Copies of such agreements in preliminary or executed form are available upon request to the Company. Capitalized terms used but not otherwise defined shall have the meaning ascribed to such terms in the agreement being described (unless otherwise indicated).

Agreements Relating to the Casino Resort

Construction Management Contract

The Company and the Construction Manager have entered into the Construction Management Contract for the construction (but not the design) of the Casino Resort (exclusive of certain demolition work, certain furniture, fixtures and equipment, the fabrication of certain theming elements, the parking garage/electrical substation facility and certain other items, the aggregate cost of which is described in "Risk Factors--Construction Management Contract and Guaranties") for a guaranteed maximum price (the "GMP"). To the extent actual costs incurred or expended in connection with the construction of the items covered by the Construction Management Contract exceed the GMP, then, subject to certain limitations and exceptions, the Construction Manager is liable for such excess. As of the Issuance Date, the GMP (the "Initial GMP"), is approximately $547.8 million, including a 5% contingency amount. After (i) the completion by the Company's architects and engineers, and approval by the Company, of the final design documents that set forth in detail the plans and specifications for the Casino Resort and (ii) the execution of trade contracts for 90% (by dollar amount) of the trade contracts portion of the GMP, a final GMP ("Final GMP") will be calculated by adjusting the Initial GMP to take into account (among other things): (a) certain "scope changes" or other changes implemented at the request of the Company; (b) the amount by which the actual aggregate amount of the signed trade contracts is less than the amount allocated to such contracts in the Initial GMP; and (iii) a reduction in the contingency amount from 5% to 3%. The GMP does not include the construction management fee to be paid to the Construction Manager or the fee payable to the Construction Manager's ultimate parent, P&O, for the P&O Guaranty. The GMP is to be appropriately increased to reflect (a) deficiencies or changes in the drawings prepared by the Company's architects and engineers, and (b) Company-mandated "scope changes" and "change orders."

The Company will pay the Construction Manager a construction management fee of 1 1/2% of the Final GMP (the "CM Fee") payable in monthly installments commencing May, 1997. In addition, upon final completion of the Casino Resort, if the total construction costs covered by the Construction Management Contract fall below the Final GMP, the savings will be allocated 50% to the Company and 50% to the Construction Manager. The Company has paid P&O a $6.5 million fee for the P&O Guaranty.

Unless otherwise specified by the Company and approved by the Construction Manager, such approval not to be unreasonably withheld, all trade contractors have been or will be selected after a bidding process that includes at least three bidders from a list of bidders approved by the Company. The Construction Manager will submit to the Company the various bids received from prospective trade contractors, all pertinent information available to Construction Manager with respect to such bids and prospective trade contractors, and Construction Manager's recommendation of the prospective trade contractor for the contract. The Company will select each trade contractor based on this information. If the Company does not select the party recommended by Construction Manager, the GMP will be increased by the amount, if any, by which the trade contract amount proposed by the trade contractor selected by the Company exceeds the trade contract amount proposed by the party recommended by the Construction Manager.

The Construction Management Contract provides that the Construction Manager will not be responsible for the consequences of any of the following events, but only to the extent (a) such events do not arise out of the negligence or wilful misconduct of the Construction Manager or any breach by the Construction Manager of the Construction Management Contract, and (b) such events are beyond the Construction Manager's reasonable control: Acts of God (such as tornado, flood, hurricane, etc.); fires and other casualties; Company's, architect's and agencies' (and their respective agents' and employees'

(other than trade contractors' and subcontractors')) acts, omissions to act, or failures to act timely; strikes, lockouts or other labor disturbances (except to the extent taking place at the Casino Resort site only); riots, insurrections, and civil commotions; embargoes; shortage or unavailability of materials, supplies, labor, equipment and systems that first arise after the date hereof, but only to the extent caused by another act, event or condition covered by this sentence; sabotage; vandalism; the requirements of laws, statutes, regulations and other legal requirements enacted after the date of the Construction Management Contract (unless the Construction Manager should, in the exercise of due diligence and prudent judgment, have anticipated such enactment); orders or judgments; and any other similar types of events. (The Company has obtained insurance coverage for certain of the events described in the preceding sentence. See "Insurance Requirements.")

The Construction Manager will be responsible for achieving "Substantial Completion" (the stage in the progress of the development of the Casino Resort when it is sufficiently complete, including the receipt of necessary permits, licenses and approvals, so that all aspects of the Casino Resort can be open to the general public) by April 1999 (the "Required Completion Date"). If Substantial Completion is achieved prior to the Required Completion Date, the Construction Manager will be entitled to a per-day early completion bonus as described below. If Substantial Completion is not achieved by the Required Completion Date, the Construction Manager will be liable for liquidated damages as described below. The Required Completion Date may be extended if: (i) certain "force majeure" events as described in the preceding paragraph occur (with respect to some of which the Company has obtained insurance coverage--See "Insurance Requirements"); (ii) the Company implements certain specified "scope changes"; and/or (iii) the design documents prepared by the architect are changed or are deficient. For the first 30 days of any delay in achieving Substantial Completion beyond the Required Completion Date, liquidated damages ("Liquidated Damages") are assessed as follows: (i) for the first seven days of such 30 day period, 1/7th of 11.11% of the "Monthly Amount" (CM Fee minus $1.4 million); for each of days 8 through 14 of such delay, 1/7th of 16.67% of the Monthly Amount; for each of days 15 through 21 of any such delay, 1/7th of 22.22% of the Monthly Amount; and for each of days 22 through 30 of such delay, 1/9th of 50% of the Monthly Amount. Liquidated Damages Insurance has been procured to cover Liquidated Damages for days 31 through 120 of a delay in achieving Substantial Completion beyond the Required Completion Date. Under the Liquidated Damages Insurance, the Company will receive, for the period commencing the 31st day through the 60th day, approximately $300,000 per day, and for the period commencing the 61st day through the 120th day, $250,000 per day. The Company will pay all premiums and other costs in connection with the Liquidated Damages Insurance. No liquidated damages are payable by the Construction Manager for days 31 through 120 of a delay in achieving Substantial Completion beyond the Required Completion Date. After the 120th day of any delay in achieving Substantial Completion beyond the Required Completion Date, the Construction Manager is (and Bovis and P&O pursuant to their guaranties are) liable for liquidated damages at a per-day rate of 3.33% of the Monthly Amount. The per-day completion bonus amounts are "mirror images" of the per-day liquidated damages amounts payable by the Construction Manager.

All disputes between the Company and the Construction Manager as to whether Construction Manager is entitled to an increase in the GMP (and if so, what the amount of such increase will be), and/or whether Construction Manager is entitled to an extension of the Required Completion Date, are to be resolved by an "Independent Expert" jointly selected by both parties.

The Company will pay for and maintain property and "wrap-up" liability insurance upon the entire Casino Resort. Such insurance includes (a) all risk property insurance; (b) on-site workers compensation and employers liability insurance; (c) commercial general liability insurance; and (d) umbrella and excess liability insurance. The Construction Manager will arrange and pay for automobile liability insurance, and offsite workers compensation insurance. After the Casino Resort is completed, the Construction Manager will issue in writing to the Company a general warranty. The general warranty will (i) be for 12 months from the date Substantial Completion of the Casino Resort is achieved, (ii) provide that where defects occur, Construction Manager will assume responsibility for all repairs to or replacements of work covered by the Construction Management Contract made necessary by such defects, and for all expenses incurred in repairing and replacing other components of the Casino Resort that were not part of the work covered by the Construction Management Contract, but were affected by such defects and (iii) be in form and substance reasonably satisfactory to the Company.

The Construction Manager's direct parent company, Bovis and ultimate parent company, P&O, respectively, have executed and delivered to the Company the Construction Management Contract Guaranty and the P&O Guaranty, respectively, which guarantee the obligations of the Construction Manager under the Construction Management Contract, including the Construction Manager's obligations with respect to liquidated damages and the GMP, provided that such guaranties only cover liquidated damages beginning with day 121 of any delay in achieving Substantial Completion beyond the Completion Date. See "Risk Factors--Construction Budget; Construction Management Contract and Guaranties."

Liquidated Damages Insurance

The Construction Manager has obtained on behalf of the Company (and at the Company's expense) the Liquidated Damages Insurance. The Liquidated Damages Insurance covers the above-described Liquidated Damages assessed under the Construction Management Contract, provided that the Liquidated Damages Insurance does not cover Liquidated Damages with respect to the first 30 days of any delay in achieving Substantial Completion by the Required Completion Date. Commencing with the 31st day of any such delay, and continuing until the 60th day thereof, the Company will receive under the Liquidated Damages Insurance approximately $300,000 per day until Substantial Completion is achieved. Commencing with the 61st day of any such delay, and continuing until the 120th day thereof, the Company will receive under the Liquidated Damages Insurance approximately $250,000 per day until Substantial Completion is achieved. The Liquidated Damages Insurance does not cover penalties assessed after the 120th day of any such delay. Additionally, the Liquidated Damages Insurance contains various exceptions. For example, the Liquidated Damages Insurance does not cover delays caused by (i) certain events of "force majeure" (with respect to some of which the Company will have other insurance coverage. See "Insurance Requirements"), (ii) any failure by the Construction Manager to make "good faith efforts" to timely achieve Substantial Completion and to avoid or mitigate any delay when an event likely to cause a delay occurs (which failure is a breach by Construction Manager under the Construction Management Contract with respect to which Construction Manager, Bovis and P&O, pursuant to the Construction Management Contract, Construction Management Contract Guaranty and the P&O Guaranty, respectively, are jointly and severally liable for damages) and (iii) the "insolvency and/or financial default" of Construction Manager, the Company, any trade contractor or any other person or entity. See "Risk Factors--Construction Budget; Construction Management Contract and Guaranties" and "--Construction Management Contract."

Completion Guaranty

Pursuant to the Completion Guaranty, the Sole Stockholder has guaranteed, subject to certain conditions and limitations, payment of construction and development costs in excess of available funds, up to a maximum of $25.0 million. The Sole Stockholder's obligation to fund such excess construction and development costs is collateralized by $25.0 million in cash or cash equivalents pledged to the Disbursement Agent. If the Issuers want to implement a scope change or change order, and such scope change or change order would cause construction and development costs to exceed available funds, such scope change or change order cannot be implemented unless the Sole Stockholder increases the maximum amount available under the Completion Guaranty, and pledges to the Disbursement Agent additional cash or cash equivalents, in the amount of such excess. The Completion Guaranty does not provide for the incurrence by the Sole Stockholder, directly or indirectly, of any obligation, contingent or otherwise, for the payment of the principal, premium and interest on the Notes, or any other indebtedness under the financings described herein. If the Sole Stockholder provides funds under the Completion Guaranty, the amount of such funds, up to a maximum of $25.0 million, will be treated as a loan from the Sole Stockholder to the Issuers that is subordinated in right of payment to the indebtedness under the Bank Credit Facility, the Mall Construction Loan Facility, the FF&E Credit Facility, the Mortgage Notes and the Senior Subordinated Notes. Although interest may accrue on such loan, no cash payments with respect to such loan may be made until all senior indebtedness (including the Senior Subordinated Notes) is repaid, except for payments made from certain construction-related recoveries. See "Risk Factors-- Completion Guaranty" and "--Sole Stockholder."

HVAC Services Agreement and Related Documents

The HVAC Provider is a Delaware limited liability company whose members are comprised of (a) Atlantic Thermal Systems, Inc., an indirect subsidiary of Atlantic Energy, Inc., a utility holding company and (b) an indirect subsidiary of Pacific Enterprises, a utility holding company.

Thermal energy (i.e., heating and air conditioning) will be provided to the Casino Resort and the Expo Center by the HVAC Provider, using the HVAC Plant and the HVAC Equipment. In addition, the HVAC Provider also will provide other energy-related services. Pursuant to the Construction Management Contract, the HVAC Plant is being constructed by the Construction Manager on land owned by Venetian, which land and HVAC Plant has been leased to the HVAC Provider for a nominal annual rent. The HVAC Equipment is and will be owned by the HVAC Provider, and the HVAC Provider has been granted appropriate easements and other rights so as to be able to use the HVAC Plant and the HVAC Equipment to supply thermal energy to the Casino Resort and Expo Center (and, potentially, other buildings), so long as such easements do not materially interfere with the operations of the Casino Resort and Expo Center. The HVAC Provider will pay all costs ("HVAC Costs") in connection with the purchase and installaton of the HVAC Equipment, up to $70 million. Venetian is acting as the HVAC Provider's agent to cause such purchase and installation to be accomplished, and is responsible for any costs in connection therewith in excess of $70.0 million. The HVAC Provider has entered into separate service contracts with (i) Venetian; (ii) Interface; and (iii) the Mall Construction Subsidiary, and will enter into separate service contracts with each Mall tenant, for the provision of heat and cooling requirements at agreed-to rates. The charges payable by all users will include a fixed component derived using a fixed annual interest rate of 8.5% (subject to adjustment based on the change in the rate on 10-year Treasury Constant Maturities from January 23, 1997 until the service commencement date) applied to the HVAC Costs paid by the HVAC Provider to recover a portion of the fair value of the HVAC Equipment over the initial term of the service contracts and leave an agreed-upon residual value (the "Fixed Rate Portion"). In addition, the users will reimburse the HVAC Provider for the annual cost of operating and maintaining the HVAC Equipment providing certain other energy related services (such reimbursement to include an agreed upon margin to compensate the HVAC Provider for operating and maintaining the HVAC Equipment). Each user will be allocated a portion of the total agreed-to charges through its service contract, which portion shall include paying 100% of the cost of services in connection with the HVAC Equipment relating solely to such user. Each user will not be liable for the obligations of the other users; provided, however, that the Mall Subsidiary will be liable for the obligations of each Mall tenant. In the event of any substantial capital improvements to the HVAC Equipment, the costs of such improvements will be spread over the lesser of (i) the useful life of such improvements and (ii) the remaining term of the HVAC Service Agreements, and will include reimbursement to the HVAC Provider for use of its money at a market rate. The HVAC Service Agreements have an initial term of ten years, and provide that upon expiration of such term users will have the right, but not the obligation, to collectively either extend the term of their agreements for two consecutive periods of five years each or purchase the HVAC Equipment in accordance with purchase provisions set forth in the service contracts.

The rights of the Company under its agreements with the HVAC Provider under its HVAC Service Agreement and related documents are collaterally assigned to the Disbursement Agent as security for Venetian's obligations under the Financing Transactions. The HVAC Provider has consented to this collateral assignment pursuant to a Consent and Agreement executed by the HVAC Provider in favor of the Disbursement Agent. Under the HVAC Consent and Agreement, the HVAC Provider has agreed (i) to continue advancing funds under the Disbursement Agreement so long as the lenders party to the Intercreditor Agreement are advancing funds under the Disbursement Agreement and certain funding conditions relating solely to the HVAC Equipment and set forth in the Disbursement Agreement are either satisfied or waived by the HVAC Provider, (ii) to acknowledge that a security interest has been granted to Disbursement Agent by the Company in its rights under the the Company's agreements with the HVAC Provider, (iii) subject to certain requirements, to recognize the Disbursement Agent or the other secured parties' rights to "step in" to the Company's rights under these agreements within specified time periods, and to forbear from exercising termination and certain other rights during such time periods, (iv) not to cancel or terminate these agreements or to consent to or accept any cancellation, termination or suspension of these agreements, without the written notice to Disbursement Agent and first providing the Disbursement Agent an opportunity to cure any default or breach by the Company, (v) subject to certain

conditions, to consent to the transfer of the Company's interest under these agreements to any of the secured parties or any of them or a purchaser or grantee at a foreclosure sale and to any purchases in lieu of foreclosure, and
(vi) that in the event one or more of the service contracts is rejected in any bankruptcy or insolvency proceedings, to execute and deliver to the secured parties a new contract which shall be on the same terms and conditions as the original service contracts. Under the HVAC Consent and Agreement, the Disbursement Agent will acknowledge the HVAC Provider's ownership of the HVAC Equipment.

Cooperation Agreement

The Company's business plan calls for the Hotel and Casino, the Mall and the Expo Center, though separately owned, to be part of an integrally related project. In order to establish terms for the integrated operation of these facilities, Venetian (as owner of the Hotel and Casino and the Phase II Land), the Mall Construction Subsidiary, and Interface have entered into the Cooperation Agreement. The Cooperation Agreement sets forth agreements among the parties regarding, among other things, construction of the Casino Resort, encroachments, easements, operating standards, maintenance requirements, insurance requirements, casualty and condemnation, joint marketing, the sharing of certain facilities and costs relating thereto. The obligations set forth in the Cooperation Agreement bind the respective properties (including (i) the Expo Center, (ii) the Hotel and Casino, (iii) the Mall and (iv) the Phase II Land) with priority over the liens securing the Bank Credit Facility and the Mortgage Notes and the liens encumbering the Mall to secure the Mall Construction Loan and the Mall Take-out Financings. Conversely, certain of the obligations under the Cooperation Agreement are not senior to the previously recorded mortgages encumbering the Expo Center. Accordingly, the obligations under the Cooperation Agreement "run with the land" in the event of transfers of the respective properties (other than a transfer by foreclosure of the existing mortgages encumbering the Expo Center).

Construction

The Cooperation Agreement sets forth covenants to effect and facilitate construction of the Casino Resort. The Mall will be constructed within or upon the areas that will constitute the Mall Parcel and the Retail Annex Parcel, neither of which is yet a separate subdivided parcel. The Cooperation Agreement contains cross encroachment provisions which will permit the Mall to encroach, to a limited extent, on other portions of the Casino Resort, and which will permit other portions of the Casino Resort to encroach, to a limited extent, on the Mall Parcel.

Operating Covenants

The Cooperation Agreement also contains certain covenants respecting the operation of the Expo Center and, once the Casino Resort is completed, the Casino Resort. For example, under the Cooperation Agreement, Venetian covenants to operate continuously and to use the Hotel and the Casino exclusively in accordance with standards of first-class Las Vegas Boulevard-style hotels and casinos, the Mall Subsidiary covenants to operate and to use the Mall exclusively in accordance with standards of first-class retail and restaurant complexes, and Interface covenants to operate and to use the Expo Center exclusively in accordance with standards of first-class convention, trade show and exposition centers. The Cooperation Agreement also provides that neither Venetian nor the Mall Subsidiary will (and will not permit any other person to) own, operate, lease, license or manage any building or other facility on, in the case of Venetian, the Venetian Site or the Phase II Land, and in the case of the Mall Subsidiary, on the Mall Parcel and the Retail Annex Parcel, if such building or other facility provides space for or to shows or expositions of the type generally held at the Expo Center. Additionally, with respect to the joint marketing of the Casino Resort and the Expo Center, the Cooperation Agreement provides that until December 31, 2010 Interface (upon request from the owner of the Hotel and Casino) will use commercially reasonable efforts to have the Hotel designated as the "headquarters hotel" for trade show and convention events at the Expo Center, and the owner of the Hotel and Casino will use commercially reasonable efforts to promote the use and occupancy of the Expo Center. It should be noted that trade show and convention promoters will be under no obligation to designate the Hotel as the "headquarters hotel" for their events.

Further, Interface has agreed under the Cooperation Agreement that, until such time as the indebtedness under the Mortgage Notes and Senior Subordinated Notes have been paid in full, the owner of the Expo Center shall not incur additional debt secured by the Expo Center if such additional debt will

cause the aggregate Indebtedness secured by the Expo Center to exceed the greater of (a) 85% of the then fair market value of the Expo Center or (b) to the extent that the same may be incurred under the existing loans secured by the Expo Center, $140.0 million plus any additional amounts permitted to be advanced thereunder for equipment leases or equipment financings. In addition, the Cooperation Agreement provides that, except in connection with the sale by the Sole Stockholder of all of his right, title and interest in and to the Project, (i) Interface will not sell, transfer or otherwise dispose of its interest in the Expo Center and (ii) no transfer of the Sole Stockholder's interest in Interface or the Expo Center, other than a Permitted Transfer (as defined in the Senior Loan Agreement), will occur.

Maintenance and Repair

Additional operational provisions in the Cooperation Agreement include the requirement that Venetian maintain, repair, and restore (a) the Hotel, the Casino and the Congress Center, and (b) certain common areas and common facilities in the Casino Resort which are to be shared with the Mall and Interface. Venetian, the Mall Subsidiary and Interface will each pay its proportionate share of the cost of maintenance of all shared common areas and common facilities in the Casino Resort. Such proportionate share of each such party will initially be determined by an Independent Expert selected by such parties and their mortgage lenders, and may be adjusted from time to time as agreed to by such parties; provided that if any of such parties' mortgage lenders does not believe any such adjustment is equitable, an Independent Expert selected by such parties and their mortgage lenders shall determine the appropriate adjustment, if any. The Cooperation Agreement further provides that the Mall Subsidiary will maintain, repair and restore the Mall and all common areas and common facilities located entirely within the Mall, and that Interface will maintain, repair and restore the Expo Center and all common areas and common facilities located entirely within the Expo Center.

Insurance

The Cooperation Agreement also requires each of (a) the owners of the Casino Resort (including both the Hotel and Casino and the Mall) and (b) the owner of the Expo Center, to maintain certain minimum types and levels of insurance, including property damage, general liability and delay in opening or business interruption insurance.

The Cooperation Agreement establishes an insurance trustee to assist in the implementation of the insurance requirements. See "Insurance Requirements" for a description of the insurance required under the Cooperation Agreement.

The Cooperation Agreement provides that in the event of a casualty prior to Completion of the Casino Resort, then the casualty proceeds will be applied in accordance with the Disbursement Agreement. The Disbursement Agreement generally provides that the Company may use such proceeds to restore the affected property so long as the conditions to disbursements set forth in the Disbursement Agreement are satisfied. See "Disbursement Agreement."

The Cooperation Agreement further provides that in the event of a casualty affecting all or part of the Casino Resort or the Mall after Completion, then
(a) all insurance proceeds above $1.5 million shall be paid to an insurance trustee to be disbursed in accordance with the provisions of the Cooperation Agreement, and (b) the Owners of the affected properties will agree to permit such proceeds to be used to restore such property as nearly as reasonably possible to its condition immediately preceding the casualty; provided, however, that no Mortgagee of a damaged property shall be required to permit such application of the resulting insurance proceeds unless within 90 days after the casualty (a) the Mortgagee receives an opinion from an "Independent Expert" to the effect the damaged property may be completed within one year after the delivery of the opinion and (b) the Mortgagee receives evidence that the insurance proceeds (together with any other funds committed by the Owner) are sufficient to cover the anticipated costs of the restoration (including scheduled debt service payments through the anticipated date of Completion of the restorations). If the owner of the affected property is unable to satisfy the foregoing conditions, then the owner's equitable share of the insurance proceeds shall be applied in accordance with the provisions of its mortgage(s). See "Risk Factors--Ability of Holders of Mortgage Notes to Realize on Collateral and Exercise Remedies."

In the event of a casualty affecting all or part of the Expo Center, the senior existing mortgage encumbering the Expo Center requires that all insurance proceeds be paid to the collateral agent under said mortgage who shall then pay all proceeds under $3.0 million to Interface to be used to restore the property.

In the event of a condemnation of a part of the Casino Resort, a part of the Mall or a part of the Expo Center, the Cooperation Agreement requires that the affected owner restore the affected property as nearly as reasonably possible to its condition at the time of the partial condemnation less the portion condemned.

Parking

The Cooperation Agreement also addresses issues relating to the use of parking facilities to be constructed by Venetian, the use of parking facilities planned in connection with the Phase II Resort, and easements for, among other things, access. Under the Cooperation Agreement, Venetian will furnish temporary parking spaces to Interface for users of the Expo Center for a monthly fee of $12,500 until the completion of the parking garage planned to be built in connection with the Casino Resort. From and after the completion of such parking garage, Venetian, the Mall Subsidiary and Interface may use the parkingspaces on a "first come, first served" basis, so long as each property retains use of sufficient spaces to comply with applicable laws to conduct its business (such minimum protections referred to herein as the "Minimum Parking Standards"). The Casino Resort Parking Garage will be owned, maintained and operated by Venetian, with the operating costs allocated among Venetian, the Mall Subsidiary, and Interface. The Cooperation Agreement also provides that after the completion of the parking garage planned to be built in connection with the Phase II Resort (if and when the same is constructed), each of Venetian, the Mall Subsidiary, Interface and the Phase II Subsidiary shall have the right to use the Phase II Resort parking garage, with the operating costs allocated among Venetian, the Mall Subsidiary, Interface and the Phase II Subsidiary. Under the Cooperation Agreement, Venetian, the Mall Subsidiary, Interface and the Phase II Subsidiary grant to each other non-exclusive easements and rights to use the roadways and walkways on their respective properties for vehicular and pedestrian access to the parking garages.

Utility Easements

Venetian, the Mall Subsidiary, Interface and the Phase II Subsidiary also have granted to each other under the Cooperation Agreement all appropriate and necessary easement rights with respect to utility lines servicing the Casino Resort, the Phase II Resort and the Expo Center.

Relations Between Venetian and the Phase II Resort

With respect to the future development of the Phase II Resort, the Cooperation Agreement provides that, prior to the commencement of construction of the Phase II Resort, Venetian may approve the plans and specifications for the Phase II Resort, subject to the rights of the lenders pursuant to the Mall Construction Loan Facility and the Tranche A Take-out Financing to approve any construction or operation of a restaurant or retail complex located in the Phase II Resort and connected to the Mall. Additionally, Venetian and the Phase II Subsidiary will agree in good faith, and upon commercially reasonable terms, on: (i) appropriate mutual operating covenants for the Hotel and the Casino and the Phase II Resort other than the Phase II Mall, (ii) joint marketing and advertising of the Hotel and the Casino and the Phase II Resort other than the Phase II Mall, (iii) certain shared casino operations at the Hotel and the Casino and the Phase II Resort other than the Phase II Mall, (iv) the sharing of customer information with respect to the Hotel and the Casino and the Phase II Resort other than the Phase II Mall, (v) the joint purchasing of insurance for the Hotel and the Casino and the Phase II Resort other than the Phase II Mall, (vi) shared security operations for the Hotel and the Casino and the Phase II Resort other than the Phase II Mall and (vii) any other matters that would be of mutual benefit in owning and operating the Hotel and the Casino and the Phase II Resort other than the Phase II Mall.

Coordinated Relations with HVAC Provider

Although the owners of the Hotel and Casino, the Mall, the Expo Center and the Phase II Land each have separate HVAC Services Agreements with the HVAC Provider, the Cooperation Agreement also provides mechanisms for these parties to deal with the HVAC Provider in a coordinated manner. In particular, the Cooperation Agreement sets forth the conditions to the owner of the Phase II Land receiving thermal energy services from the HVAC Plant, including the requirement that the owner of the Phase II Land pay all incremental costs attributable to such services (and any additional capital improvements required for such services). The Cooperation Agreement also provides mechanisms for the owners of the various properties to make decisions

with respect to the termination or extension of the HVAC Services Agreements. In general, these provisions permit a property owner that is not receiving adequate HVAC services to replace the HVAC Provider, so long as the property owner (i) arranges for an experienced substitute utility operator to take over operation of the HVAC Plant, and (ii) indemnifies the other property owners against additional payment obligations arising as a consequence of the termination of the previous operator of the HVAC Plant.

Consents, Approvals and Disputes

The Cooperation Agreement provides that wherever any property owner has a consent or approval right or otherwise has discretion to act or refrain from acting thereunder, such consent or approval shall only be granted and such action shall be taken or not taken, only where a Commercially Reasonable Owner (as defined in the Cooperation Agreement) would do so and the same would not be likely to have a Material Adverse Effect (as defined in the Cooperation Agreement) on the property owned by the property owner. The Cooperation Agreement also provides for the appointment by the parties of an "Independent Expert" to resolve certain disputes between the parties, as well as for expedited arbitration with respect to any other disputes.

Agreements Relating to the Mall

Sale and Contribution Agreement

Venetian, the Mall Construction Subsidiary and the Mall Subsidiary have entered into a Sale and Contribution Agreement whereby the Mall Construction Subsidiary agreed to sell and the Mall Subsidiary agreed to purchase, among other things, (i) all of its right, title and interest (whether in fee or in leasehold) in and to the property and improvements that constitute the Mall in their "as is" condition on the date of Completion, (ii) monies deposited in certain reserve accounts relating to the Mall, (iii) all right, title and interest of the Mall Construction Subsidiary in and to the Master Billboard Lease and (iv) all right, title and interest of the Mall Construction Subsidiary (a) as landlord under Mall Tenant Leases, (b) under the Cooperation Agreement, (c) in and to all other easements, fixtures and improvements appurtenant thereto, (d) under the Energy Services Agreement, dated as of June 1, 1997 with the HVAC Provider and any other Mall Intangible Property Rights, and (e) in and to all Mall Personal Property (collectively, the "Mall Assets"). In connection with the sale of the Mall, the Mall Construction Subsidiary also will transfer to the Mall Subsidiary the proceeds of the final draw under the Mall Construction Loan (and, under certain circumstances, a specified amount under the Completion Guaranty) (the "Mall Retainage/Punchlist Amount").

As consideration for such transfers, the Mall Subsidiary shall, among other things, repay or assume in full the outstanding balance of the Mall Construction Loan (or certain refinancings thereof), including the amount of the final draw thereunder.

The Sale and Contribution Agreement further provides that the Mall Retainage/Punchlist Amount will be deposited into a segregated account governed by an escrow agreement between the Mall Subsidiary and the Mall Construction Subsidiary. The escrow agreement will provide that funds on deposit in the account will be released to the Mall Construction Subsidiary, subject to satisfaction of the conditions set forth in the Disbursement Agreement, for application to the payment of retainage amounts owed to contractors, costs of completing punchlist items and other remaining costs to complete the Casino Resort. In the event that the Mall Construction Subsidiary fails to achieve final completion of the Casino Resort within 18 months after the closing of the sale of the Mall, the Mall Subsidiary will be permitted to withdraw funds from the account and use them to complete the Mall punchlist items and pay other unpaid project costs. Upon final completion of the Casino Resort, any amount remaining in the escrow account shall be released to the Mall Construction Subsidiary.

Mall Lease

Venetian, as landlord, and the Mall Construction Subsidiary, as tenant, have entered into the Mall Lease pursuant to which Venetian will lease to the Mall Construction Subsidiary (i) the space within the principal structure of the Casino Resort located immediately above the Casino and immediately below the Hotel Tower (the "Principal Mall Parcel"), together with (ii) certain land (the "Retail Annex Parcel") (the Principal Mall Parcel and the Retail Annex Parcel together constitute the Mall Parcel, and (i) and (ii) together with all improvements thereon will comprise the Mall) for a nominal annual rent. The Mall Lease

automatically expires upon the 99th anniversary of the commencement date of the Mall Lease. The tenant under the Mall Lease will own all improvements to be made to the Mall Parcel during the term of the Mall Lease. The Mall Lease will provide that fee title in and to the Mall Parcel automatically will vest in the Mall Construction Subsidiary when and if the Mall Parcel becomes a separate legal and tax parcel, and the Mall Lease thereupon shall terminate.

"Billboard Live!" Lease

Mall Construction Subsidiary, as landlord, and B.L. International of Nevada, Inc. ("BLINI"), as tenant, are parties to a lease for a 50,000 square foot "Billboard Live!" themed entertainment complex (the "Billboard Operating Lease"). The leased space will include areas adjacent to the casino floor (the "Additional Billboard Space") and within the Mall. The initial term of the Billboard Lease is 20 years from the date of the opening of the Casino Resort and BLINI has two five-year renewal options. The rent under the Billboard Lease is comprised of an annual minimum rent component and percentage rent component. In addition, BLINI will pay a pro-rata share of Mall common area cost charges. The Billboard Lease also provides that Venetian may elect to terminate the Billboard Lease without compensation to BLINI, in the event that, subsequent to the initial 12-month period following the lease commencement date, BLINI's average monthly gross income fails to meet certain thresholds during a period consisting of three consecutive months. The Mall Construction Subsidiary may at any time assign or transfer all or part of its interest as landlord in and to the Billboard Lease, without notice or obtaining any approval from BLINI.

Venetian, as landlord, and the Mall Construction Subsidiary, as tenant, have entered into a lease (the "Master Billboard Lease") for the Additional Billboard Space pursuant to which Venetian will lease to the Mall Construction Subsidiary the Additional Billboard Space for the term of the Billboard Operating Lease.

Mall Management Contract

The Mall Subsidiary has entered into an agreement with Forest City Enterprises ("Forest City"), a subsidiary of Forest City Ratner Enterprises, a leading developer and manager of retail and commercial real estate developments, whereby Forest City Enterprises will manage the Mall and supervise and assist in the creation of an advertising and promotional program and a marketing plan for the Mall. Forest City will also be responsible for, among other things, preparation of a detailed plan for the routine operation of the Mall, collection and deposit procedures for rents and other tenant charges, supervision of maintenance and repairs and, on an annual basis, preparation of a detailed budget (including any anticipated extraordinary expenses and capital expenditures) for the Mall. The term of the management contract is five years from the date the Mall opens for business to the public. Forest City will receive a management fee of 2% of all gross rents received from the operation of the Mall; provided, that Forest City will receive a minimum fee of $450,000 per year. Forest City is not affiliated with the Sole Stockholder or any of his affiliates.

Mall Leasing Contract

LVSI has engaged the San Francisco and Los Angeles offices of Blatteis Realty Co. ("BRC") as its retail leasing consultant (the "BRC Contract"). BRC is a national real estate brokerage organization specializing in the leasing and sales of high profile retail properties and representation of a select portfolio of retailers and restaurants. Recent retail leasing transactions that BRC has been involved with (at locations other than the Casino Resort) have included the following tenants: Emporio Armani, Giorgio Armani, Jose Eber, Prada, Salvatore Ferragamo, Barnes & Noble Superstore, The Pottery Barn, the Disney Store, Williams-Sonoma, Planet Hollywood and Cafe Med. BRC will assist with planning, marketing and leasing of the Mall. BRC also will advise the Company and its architects, designers, consultants and other agents with respect to the Mall's tenant mix and the conceptual layout of tenant space. The term of the BRC Contract is for a period of 18 months from December 1, 1996, and may be terminated by either party at any time on 60 days' prior written notice to the other party. BRC, which is not affiliated with the Sole Stockholder or any of his affiliates, receives a monthly consulting fee of $10,000 plus a refundable monthly sum of $10,000 as an advance against, and credited to the payment of, lease brokerage commissions. Leasing commissions payable to BRC are calculated on the basis of $8.00 per leased square foot or $4.00 per leased square foot, depending upon the location of the applicable leased space within the Mall.

Agreements Relating to the Lido Casino Resort

If the Phase II Resort is constructed, the following agreements may be entered into by the Phase II Subsidiary and its subsidiaries, on one hand, and the Company, Venetian and the Mall Subsidiary, on the other hand:

Casino Lease

If the Phase II Resort is constructed, in order to avoid the need for a separate gaming license for the Phase II Subsidiary, LVSI or Venetian may operate the casino for the Phase II Resort pursuant to a lease (the "Phase II Casino Lease"). The Phase II Lease will have terms substantially similar to the Casino Lease except that (i) the rent payable under such lease shall be equal to all revenue derived from such casino minus the sum of (a) the operating costs related to such casino (including an allocated portion (based on gaming revenue) of the Company's or Venetian's, as the case may be, administrative costs related to its gaming operations) and (b) the lesser of $250,000 or 1.0% of such casino's operating income (or zero if there is an operating loss)
(determined in accordance with generally accepted accounting principles), (ii)
the Company or Venetian, as the case may be, may agree that they shall operate the casino in the Phase II Resort and the Casino in substantially similar manners and (iii) the Company or Venetian, as the case may be, may agree to have common gaming and surveillance operations in such casinos (based on equal allocations of revenues and operating costs).

Phase II HVAC Services Agreement

The Cooperation Agreement permits the owner of the Phase II Land to enter into an HVAC Services Agreement to receive HVAC services from the HVAC Plant. Any such agreement would have to be on terms satisfactory to the HVAC Provider. See "Certain Material Agreements--Cooperation Agreement."

Phase II Mall Arrangments

The Cooperation Agreement and the Mall Take-out Financings further condition development of retail and restaurant improvements upon the Phase II Land upon the execution of appropriate reciprocal easement arrangements. See "Certain Material Agreements--Cooperation Agreement" and "Description of Certain Indebtedness--Mall Take-out Financing Commitments."