EFTA00593277.pdf

AGREEMENT AMONG PRINCIPALS dated as of July 13, 2007 among •. I : EFTA00593277 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered, all as of the date first set forth above. Leon D. Black Marc J. Rowan Jo J. Harris BLACK FAMILY PARTNERS, L.P. By: Black Family GP, LW, its General Partner By. Leon D. Black Manager MJR FOUNDATION LLC By: Name: Marc J. Rowan Title: Manager BRA HOLDINGS, L.P. By: BRH Holdings GP, LTD. its General Partner By: Name: John J. Suydam Title: Vice President [Agrcanent Among Principals] EFTA00593278 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered, all as of the date first set forth above. Leon D. Black Marc J. Rowan Joshua J. Harris BLACK FAMILY PARTNERS, L.P. By: Black Family GP, LW, its General Partner By: Leon D. Black Manager MIR FOUNDATION LLC By: Name: Marc J. Rowan Title: Manager BRH HOLDINGS, L.P. By: BRH Holdings GP, LTD. its General By. ohn J. uydam Title: Vice President [Agreement Among Principals] EFTA00593279 AP PROFESSIONAL HOLDINGS, L.P. By: BRH Holdings GP, Ltd., its General Partner By: Suyd Vice President [Agnxment Among Principals] EFTA00593280 SCHEDULE I Heritatie Funds' HERITAGE POINTS IN HERITAGE FUNDS Carry in Private Equity Funds LB Group MR Group JH Group Fund IV GP 500.1260 145.3782 56.8771 Fund V GP 419.0998 183.4736 154.4105 HERITAGE POINTS PERCENTAGES IN HERITAGE FUNDS Carry in Private Equity Funds LB Group MR Group JH Group Fund IV GP 71.2043% 20.6979% 8.0978% Fund V GP 55.3644% 24.2375% 20.3981% Calculated as of immediately following the consummation of the transactions contemplated in the Roll-up Agreements, the Principals Contribution Agreement and Strategic Agreement NYI:168645916 EFTA00593281 SCHEDULE II Excluded Assets PRIVATE EOUITY FUNDS Apollo Advisors, LP Apollo Advisors II, LP APOLLO REAL ESTATE ENTITIES Apollo Real Estate Capital Partners, LP Apollo Real Estate Advisors II, LP Apollo Real Estate Advisors III, LP Apollo Real Estate Advisors IV, LP Apollo Real Estate Advisors V, LP Apollo International Real Estate Advisors, LP Apollo Poland Real Estate Advisors, LLC Apollo EU Real Estate Advisors II, LP Apollo Real Estate Mezzanine Advisors, LP Apollo Excelsior Capital Partners, LP Apollo Epoch Real Estate Advisors, LP Apollo Real Estate Advisors, LP Apollo Real Estate Management II, LP Apollo Real Estate Management III, LP Apollo Real Estate Management IV, LP Apollo Real Estate Management V, LP Apollo International Real Estate Management, LP Apollo EU Real Estate Management II, LP Apollo Real Estate Co-Investors (EU), LLC AREA Co-Investors (EU), LW Apollo Corp. EU II Co-Investors, LLC Apollo Real Estate Mezzanine Management, LP AP Excelsior Management, LP AP Epoch Management, LP Apollo Real Estate Investment Fund, LP AREIF II Co-Investors, LLC AREIF III Co-Investors, LW AREIF IV Co-Investors, LLC AREIF V Co-Investors, LW AREA Co-Investors (V), LLC Apollo Corp. AREIF V Co-Investors, LLC AIREF Co-Investors, LLC Apollo Poland Real Estate Co-Investment, LP AIREF II Co-Investors, LW AP Epoch Co-Investors, LLC Excelsior Co-Investors, LW AREMF Co-Investors, LLC NV1:168445916 EFTA00593282 SCHEDULE II Excluded Assets (Continued) ARES CORPORATE OPPORTUNITY FUND AP-AR Holdco, LP APOLLO CO-INVESTMENT VEHICLES AIC Co-Investors, LLC Apollo SVF Co-Investors, LLC Apollo DIF Co-Investors, LLC Apollo SOMA Co-Investors, LLC Apollo Co-Investors III, LLC, Apollo Co-Investors IV, LLC, Apollo Co-Investors V, LLC, and Apollo Co-Investors V (EH), LLC. Apollo Co-Investors VI (EH-A), L.P. Apollo Co-Investors VI (A), LW Apollo Co-Investors VI (B), LLC Apollo Co-Investors VI (C), LLC Apollo Asia Co-Investors, LLC Apollo Asia Co-Investors Offshore, LP Apollo EPF Co-Investors, L.P. MISCELLANEOUS AP Technology Partners, LLC AP Energy Partners, LLC AP Propco, LLC AP Capital Propco, LLC RS Movie Holdings, LLC Lion Advisors, LP AIF IV Management, Inc.2 Hamlet ControlNote Company3 2 1 AIF IV Management Inc., the administrative general partner of Apollo Management IV, L.P., exists solely to hold the split-dollar life insurance policy for LB and LB is the sole shareholder of the entity. AIF IV Management Inc.'s interest in Apollo Management IV, L.P. is to be convened to a limited partnership interest and future premium payments on the life insurance policy will be paid by Black Family Partners, L.P. Company to be formed to hold the voting and control interest in connection with the proposed investment in Harrah's Entertainment, Inc. NYI:1686459.16 EFTA00593283 SCHEDULE II Excluded Assets (Continued) CAPITAL COMMITMENTS TO GENERAL PARTNERS OF FUNDS (WHETHER THROUGH CO-INVESTMENT VEHICLES OR OTHERWISE General Partner Approximate Capital Commitments LB Group MR Group JH Group Other Professionals and related parties Fund IV GP $ 7,377,953 $ 4,967,645 S 0 $ 22,354,402 Fund V GP $ 992,859 $ 0 $ 0 $ 257,141 Fund VI GP $ 1,250,000 $ 0 $ 0 $ 0 Apollo Value Advisors, L.P. $ 346,212 $ 173,105 $ 173,105 $ 307,578 Apollo SOMA Advisors, L.P. $ 310,000 $ 197,500 $ 197,500 $ 95,000 4 Excluded Asset is limited to distributions (and related allocations of income and loss) made to such General Partner solely with respect to its capital commitments in its related Fund, and not with respect to carried interest. Also excluded are amounts committed to such General Partner by other Apollo professionals. All such commitments may be made by the Principals and the other Apollo professionals directly or indirectly through other entities. NY1:1686459.I6 EFTA00593284 SCHEDULE III AOG Units PECUNIARY INTEREST IN AOG UNITS5 LB Group MR Group JH Group AOG Units 92,109,120.00 58,614,960.00 58,614,960.00 SHARING PERCENTAGES LB Group MR Group JH Group Sharing Percentage 44.00 28.00 28.00 After giving effect to the Roll-up Agreements, the Principals Contribution Agreement and the Strategic Agreement NYI:1686459.16 EFTA00593285 SCHEDULE IV Permitted Transferees SL I 1. Black Family Partners, L.P. MR Grout) 1. MIR Foundation LLC JH Grow) None NYI:1686459.IS EFTA00593286 SCHEDULE V Notices If, to LB or any member of his Group: Leon Black 760 Park Avenue New York, NY 10021 with a copy to: Wachtel], Lipton, Rosen & Katz 51 West 52nd Street 34th Floor New York, NY 10019-6150 Attention: David Karp, Esq. If, to MR or any member of his Group: Marc Rowan 927 Fifth Avenue Apartment #6 New York, NY 10021 with a copy to: Cooley Godward Kronish LLP The Grace Building 1114 Avenue of the Americas New York, NY 10036-7798 Attention: Chet Lipton, Esq. If, to JH or any member of his Group: Josh Harris 895 Park Avenue Apt 4/5 B New York, NY 10021 with a copy to: Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P.C. Chrysler Center 666 Third Avenue New York, NY 10017 Attention: Robert Bodian, Esq. NYI:1686459.16 EFTA00593287 If, to Holdings: Any notice to Holdings shall be deemed given when notice is provided to LB, MR and JH. with a copy to: O'Melveny & Myers LLP Times Square Tower 7 Times Square New York, NY 10036 Attention: Harvey Eisenberg, Esq. If, to Intermediate Holdings: Any notice to Intermediate Holdings shall be deemed given when notice is provided to LB, MR and JH. with a copy to: O'Melveny & Myers LLP Times Square Tower 7 Times Square New York, NY 10036 Attention: Harvey Eisenberg, Esq. NYI:1686459.16 EFTA00593288 SCHEDULE VI The parties hereto agree and acknowledge that prior to an IPO, the provisions set forth on this Schedule VI shall be operative and that in the event of any conflict between the terms of the body of the Agreement and the terms of the provisions set forth on Schedule VI, the terms of the provisions set forth on Schedule VI shall control. The parties hereto agree and acknowledge that the provisions set forth on Schedule VI consist solely of "term sheet level detail" and that if a Principal is terminated prior to an IPO, the parties shall negotiate in good faith to amend this Agreement to reflect the provisions set forth on Schedule VI. The provisions set forth on Schedule VI shall terminate upon the consummation of an IPO, and Schedule VI shall automatically be amended and restated to read in its entirety: "INTENTIONALLY LEFT BLANK." I. Additional Definitions. "11?Q" means (i) one or more private placements of Class A Shares by Apollo pursuant to Rule 144A, Regulation D and/or Regulation S under the Securities Act of 1933, in an offering that requires Apollo to file with the SEC a shelf registration statement permitting registered resales of the Class A Shares after the consummation of such offering (excluding the transactions contemplated by the Strategic Agreement), or (ii) one or more offerings of Class A Shares pursuant to an effective registration statement filed by Apollo with the SEC or the Financial Services Authority of the United Kingdom (in connection with a listing on the London Stock Exchange) (other than on Forms S-4 or S-8 or successors and/or equivalents to such forms), provided, that the aggregate amount of Class A Shares sold in all such private placements and public offerings represents at least 10% of the then outstanding Class A Shares of Apollo (to be determined assuming that all outstanding AOG Units have been exchanged for Class A Shares pursuant to the Exchange Agreement). 2. Prior to an IPO, Section 2.1(c) shall read as follows: "The Executive Committee shall negotiate in good faith with potential Fund investors to provide that any future mandatory capital commitments to be made by the general partner of any Fund shall be funded by Apollo (and not directly by the Principals). Notwithstanding the foregoing, the Executive Committee shall have the authority to determine whether it is commercially advantageous to have the Principals fund such capital commitments and, in the event that the Executive Committee so determines, the Principals agree to fund such capital commitments; provided, however, that (i) without the unanimous consent of the Executive Committee, no general partner of any Fund or any co-investment vehicle established to invest in any Fund shall commit to make a capital commitment in excess of 2.5%, in the aggregate, of the total capital commitments received by such Fund, and the portion of such capital commitment to be made by the Principals shall be reduced by the amount of such capital commitments to be made (as determined by the majority approval of the Executive Committee) by (A) Apollo and its Subsidiaries (excluding any Funds that may be Subsidiaries) and (B) the other investment professionals employed by Apollo and its Subsidiaries; (ii) without the unanimous consent of the Executive Committee, no Principal shall be required to make a capital commitment in excess of $75 million in any individual Fund; (iii) except as provided in clauses (iv) and (v) below, if the Principals are obligated to make future capital commitments to any Fund or any co-investment NYI:1686459.16 EFTA00593289 vehicle established to invest in any Fund, such capital commitments will be made by the Principals obligated to make such capital commitments (or other members of their respective Groups) outside of Holdings ratably in accordance with the Sharing Percentages of their respective Groups as of the date of the First Closing of such Fund (for the avoidance of doubt, each such capital commitment by a Principal or his Group shall be an Excluded Asset); (iv) no Principal shall be required to make any future capital commitment to any Fund that has a First Closing after the date of such Principal's termination or to any co-investment vehicle established to invest in any Fund that has a First Closing after the date of such Principal's termination; and (v) any mandatory capital commitments by Holdings to a Heritage Fund will be made by the Principals in accordance with the Heritage Points Percentages in such Heritage Fund without giving effect to any adjustments thereto (for the avoidance of doubt, each such capital commitment by a Principal or his Group shall be an Excluded Asset)." 3. Prior to the completion of the IPO, in addition to compliance with the conditions set forth in the proviso of Section 5.4(bl, any LB Extraordinary Transaction may be consummated only if at least 80% of the value of the consideration payable to the Principals consists solely of cash and liquid securities (i.e., subject to customary restrictions, the securities must be freely tradeable or subject to appropriate registration rights and the securities must be publicly traded and have a substantial public float) and any illiquid securities must vest on terms no less favorable to the Principal than ratably on the remaining vesting schedule for such Principal set forth in this Agreement. Prior to an IPO, LB shall not have to obtain the approval of the Independent Board in order to cause an LB Extraordinary Transaction. 4. Prior to an IPO, any powers to be exercised by the Independent Board pursuant to the body of the Agreement (i) with respect to the determination of "Disability" of a Principal, shall be exercised by a licensed doctor selected by the Executive Committee and (ii) with respect to Sections 5.3(a) and 5.3(c), shall be exercised by John Suydam after consultation with the Continuing Principals. NY 1:1686159.16 EFTA00593290 EXHIBIT A FORM OF JOINDER TO AGREEMENT AMONG PRINCIPALS THIS JOINDER (this "Joinder") to that certain Agreement Among Principals (the "Agreement") dated as of July 13, 2007, by and among Leon D. Black ("LB"), Marc J. Rowan ("MR"), Joshua J. Harris ("MI", and together with LB and MR, the "Principals" and each individually, a "Principal") Black Family Partners, L.P., a Delaware limited partnership, MJR Foundation LLC, a New York limited liability company, AP Professional Holdings, L.P., a Cayman Islands exempted limited partnership ("Intermediate Holdings"), and BRH Holdings, L.P., a Cayman Islands exempted limited partnership ("Holdings"), is made and entered into as of July 13, 2007 by and between Holdings and [NAME OF PERMITTED TRANSFEREE] (the "Transferee"). Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Agreement. WHEREAS, the Transferee has acquired an ownership interest in Holdings, and the Agreement requires the Transferee to become a party to the Agreement, and Transferee agrees to do so in accordance with the terms hereof. NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Joinder hereby agree as follows: I. Agreement to be Bound. The Transferee hereby agrees that upon execution of this Joinder, [he, she or it] shall become a party to the Agreement and shall be fully bound by, and subject to, all of the covenants, terms and conditions of the Agreement as though an original party thereto and as a member of the [ ] Group. 2. Successors and Assigns. Except as otherwise provided herein, this Joinder shall bind and inure to the benefit of and be enforceable by Holdings and each Principal and their respective successors and assigns so long as the Transferee holds any ownership interest in Holdings. 3. Counterparts. This Joinder may be executed in separate counterparts, including by facsimile, each of which shall be an original and all of which taken together shall constitute one and the same agreement. 4. Notices. For purposes of Section 6.1 of the Agreement, all notices, demands or other communications to the Transferee shall be directed to: [Name] [Address] [Attention] 5. Governing Law. THIS JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE (WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF). 6. Descriptive Headings. The descriptive headings of this Joinder are inserted for convenience only and do not constitute a part of this Joinder. NYI:1686459.16 EFTA00593291 IN WITNESS WHEREOF, the parties hereto have executed this Joinder as of the date first above written. BRII HOLDINGS, By: Name: Title: [TRANSFEREE] By: Name: Title: NY 1:1686159.16 EFTA00593292