MHG put up one-third of the acquisition equity, which is approximately $57.5 million, and DLJMB is funding the remainder, which is approximately $115 million. In addition, DLJMB has agreed to fund 100% of the capital required to expand the Hard Rock property, up to a total of an additional $150 million, though MHG will have the option to fund the expansion project proportionate to its equity interest in the joint venture.

The remainder of the purchase price consists of a $760-million loan for the acquisition including renovation and financing costs and reserves, and a loan of up to $600 million for future expansion of the Hard Rock. The initial term of the loan is two years (or three years in the event that the construction loan is advanced), with a possible extension of up to two terms of one year each under certain conditions.

The interest rate on the loan will be 415 basis points above 30-day LIBOR, subject to increase if the completion date of the expansion project is delayed and under certain other conditions. The security for the loan includes the hotel & casino, the Hard Rock Cafe property, the adjacent parcel, the intellectual property and certain reserve funds and accounts. The Borrower is required to qualify for the construction loan, and the first advance under the construction loan is required to be made, by April 1, 2008.

MHG will manage the Hard Rock Hotel, retail, food and beverage and all other business related to operating the Hard Rock, for which it will receive a management fee equal to 4% and a chain service expense reimbursement of all non-gaming revenue including casino rents and all other rental income. MHG may also earn an incentive management fee of 10% of EBITDA above certain levels. The term of the contract is 20 years with two 10-year renewals and is subject to certain performance tests beginning in 2009.

MHG, in turn, has executed a definitive lease agreement for operation of the casino with an affiliate of Golden Gaming Inc., a major gaming enterprise in Nevada. The lease, which has a term of up to two years, commenced upon the closing of the acquisition. Under the lease, the base rent is $20.7 million per year payable monthly, plus reimbursements for certain expenses. Golden Gaming is entitled to a management fee of $3.3 million, also payable monthly. The gaming assets were sold to Golden Gaming for a note with a principal amount equal to the net book value of the gaming assets. Casino EBITDA in excess of the rent and management fee amounts will be distributed 75% to Hard Rock for payment of principal and interest on the gaming asset note and any other loans to the lessee and 25% to Golden Gaming.