LEASE
This lease is made between Security Financial Services, L.L.C, herein
called Lessor, and Casino Resource Corporation, herein called Lessee.
Lessee hereby offers to lease from Lessor the premises situated in the
City of Ocean Springs, County of ▇▇▇▇▇▇▇, State of Mississippi, described as
the land and building depicted in Exhibit "A", upon the following terms and
conditions:
1. TERM AND RENT. Lessor demises the above premises for a term of five
(5) years, commencing May 15, 1997 and terminating on May 14, 2002, or sooner
as provided herein at the annual rental of Seventy-three Thousand Five
Hundred and no/100 ($73,500.00) payable in equal monthly installments. Upon
the execution of this lease, Lessee will tender 1 1/2 months rent which shall
be credited to the first 1 1/2 months rent. Thereafter, each month's rent
shall be due in advance on the first day of each month for that month's
rental, but no later than the seventh day.
The rent which Lessee agrees to pay Lessor during the basic term shall
be adjusted up to the amount determined through multiplying the annual rental
paid for the first lease year by a percentage equal to the percentage
increase in the Consumer Price Index for the United States as published by
the Bureau of Labor Statistics, U.S. Department of Labor, or its successor
index, on the next ensuing year anniversary date of this lease. However,
both parties agree to an annual cap of five (5 %) percent.
2. USE. Lessor warrants that the Lessee shall receive quiet use ad
enjoyment of the leasehold premises. Lessee shall use and occupy the
premises for its corporate offices. Lessor represents that the premises may
lawfully be used for such purpose.
3. CARE AND MAINTENANCE OF PREMISES. Lessee acknowledges that the
premises are in good order and repair, unless otherwise indicated herein.
Lessee shall, at his own expense and at all times, maintain the premises in
good and safe condition, including plate glass, electrical wiring, plumbing
and heating installations and any other system or equipment upon the
premises, and shall surrender the same at termination hereof, in as good
condition as received normal wear and tear excepted. Lessee shall he
responsible for all repairs required, excepting the roof, exterior walls, and
structural foundations. Lessee shall be the beneficiary of all guarantees and
warranties issued to Lessor and Lessor shall perfect same.
4. ALTERATIONS. Lessee may make alterations on the interior with
Lessor's written permission. Such approval shall not be unreasonably
withheld.
5. ORDINANCES AND STATUTES. Lessee shall comply with all statutes,
ordinances and requirements of all municipal, state and federal authorities
now in force, or which may hereafter be in force, pertaining to the premises,
occasioned by or affecting the use thereof by Lessee, as long
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as Lessee is able to quietly enjoy premises. Lessor warrants that he is not
aware of any special assessments or requirements imposed by any agency that
he has not disclosed in writing to Lessee (see Exhibit "B").
6. ASSIGNMENT AND SUBLETTING. Lessee shall have the right to assign
this lease or sublet any portion of the premises, but shall at all times be
responsible for lease.
7. UTILITIES. All applications and connections for necessary utility
services on the demised premises shall be made in the name of Lessee only,
and Lessee shall he solely liable for utility charges as they become due,
including those for sewer, water, gas, electricity and telephone services.
8. POSSESSION. Lessee shall not be liable for any rent until possession
is delivered. Lessee may terminate this lease if possession is not delivered
within 20 days of the commencement of the term hereof. Lessee shall conduct
a walk through with Lessor on or before May 15, 1997, to go over completed
checklist which Lessor and his contractor agreed to complete at Lessor's
expense.
9. INSURANCE. It shall be the obligation of Lessor to insure the
improvements on the leased premises against loss or damage by fire, windstorm
or other casualty as he deems appropriate. Any amounts which may become
payable under said policies of insurance shall be the sole property of
Lessor, and Lessee hereby waives any and all claims he may have to said
insurance proceeds. However, Lessor shall make all appropriate repairs to the
building, as the Lessee deems appropriate, from any casualty.
It shall be the obligation of Lessee to obtain insurance against
liability for bodily injury for Lessee's lease of Lessor's premises, in
amounts of not less than One Million and no/100 ($1,000,000.000) Dollars, and
Lessor shall be named as an additional insured with evidence of such
insurance being in force during this lease and provided by Lessee to Lessor.
It shall be the obligation of Lessee to insure their inventory, any
property, all goods ad chattels inside the leased premises against loss or
damage as Lessee deems appropriate. Any amounts which may become payable
under said policies of insurance shall be the sole property of Lessee, and
Lessor hereby waives any and all claims he may have to said insurance
proceeds relating to Lessee's inventory, property, goods and chattels.
10. INDEMNIFICATION. Lessee covenants and warrants that it will
indemnify Lessor and save Lessor harmless from any and all claims, damages,
liabilities, and expense by Lessee, its agents, servants, employees, third
persons caused from loss of life, personal injury, damage to property or any
other loss arising (a) out of any occurrence in or at the leased premises, or
the occupancy of use by Lessee occurring at any time during this lease or
extension thereof; (b) out of any at of omission of Lessee, its employees,
servants, agents or concessionaires. If Lessor should be made a party to any
litigation commenced by or against Lessee, Lessee shall protect, indemnify,
and hold Lessor harmless and pay all costs, expenses, and reasonable
attorney's fees that may be incurred or paid by
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Lessor in enforcing the covenants and conditions of this agreement. There is
by agreement, specifically excluded from this hold harmless and indemnity
clause all claims, actions, expenses and damages for loss of life, personal
injury, damage to property or other loss arising out of any act or omission
of Lessor, its agents, servants, and employees.
11. EMINENT DOMAIN. If the premises or any part thereof or any estate
therein, or any other part of the building materially affecting Lessee's use
of the premises, shall be taken by eminent domain, this lease shall terminate
on the date when title vests pursuant to such taking. The rent, and any
additional rent, shall be apportioned as of the termination date, and any
rent paid for any period beyond that date shall be repaid to Lessee. Lessee
shall not be entitled to any part of the award for such taking or any payment
in lieu thereof but Lessee may file a claim for any taking of fixtures and
improvements owned by Lessee, and for moving expenses.
12. DESTRUCTION OF PREMISES. In the event of a partial destruction of
the premises during the term hereof from any cause, Lessor shall forthwith
repair the same, provided that such repairs can be made within sixty (60)
days under existing governmental laws and regulations, but such partial
destruction shall not terminate this lease, except that Lessee shall be
entitled to a proportionate reduction of rent while such repairs are being
made, based upon the extent to which the making of such repairs shall
interfere with the business of Lessee on the premises. If such repairs
cannot be made within said sixty (60) days, Lessor, at his option may make
the same within a reasonable time, this lease continuing in effect with the
rent proportionately abated as a foresaid, and in the event that Lessor shall
not elect to make such repairs which cannot be made within sixty (60) days,
this lease may be terminated at the option of either party. In the event
that the building in which the demised premises may be situated is destroyed
to an extent of not less than one-third of the replacement costs thereof
Lessor may elect to terminate this lease whether demised premises be injured
or not. A total destruction of the building in which the premises may be
situated shall terminate this lease.
13. LESSOR'S REMEDIES ON DEFAULT. If Lessee defaults in the payment of
rent, or any additional rent, or defaults in the performance of any of the
other covenants or conditions hereof, Lessor may give Lessee notice of such
default and if Lessee does not cure any such default within five (5) days,
after the giving of such notice (or if such other default is of such nature
that it cannot be completely cured within such period, if Lessee does not
commence such curing within such five (5) days and thereafter proceed with
reasonable diligence and in good faith to cure such default), then Lessor may
terminate this lease on not less than five (5) days' notice to Lessee. On
the date specified in such notice the term of this lease shall terminate, and
Lessee shall then quit and surrender the premises to Lessor, but Lessee shall
remain liable as hereinafter provided. If this lease shall have been so
terminated by Lessor, Lessor may at any time thereafter resume possession of
the premises by any lawful means and remove Lessee or other occupants and
their effects. No failure to enforce any term shall be deemed a waiver.
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If the premises shall be abandoned during the term or if Lessee shall be
evicted from said premises by summary proceedings or otherwise, or in the
event of the commencement of any bankruptcy proceedings by or against Lessee
which are not discharged or dismissed within thirty (30) days, or upon the
happening of any event of default as provided above, Lessor may at its
election terminate this lease (in which event Lessor shall be entitled to
recover damages for any such default), or Lessor may reenter the same by
force or otherwise, without being liable for prosecution therefor, and may
re-let the premises at any time as agent of Lessee, applying any monies
collected first to costs, fees and expenses of collecting, then to the
expense of obtaining possession, then to the payment of the rent and all
other sums owing and to become owing Lessor and paying any surplus thereof to
Lessee; and such reentry and re-letting shall not discharge Lessee from
liability for rent or from any other covenant of this lease by Lessee to be
kept and performed.
14. TAXES AND ASSESSMENTS. In the event there is any increase during
any year of the term of this lease in the City, County or State real estate
taxes over and above the amount of such taxes assessed for the tax year
during which the term of this lease commences, whether because of increased
rate or valuation, Lessee shall pay to Lessor upon presentation of paid tax
bills an amount equal to 100% of the increase in taxes upon the land and
building in which the leased premises are situated. In the event that such
taxes are assessed for a tax year extending beyond the term of the lease, the
obligation of Lessee shall be proportionate to the portion of the term
included in such year. Lessor shall be required to fund any special
assessments levied on the building by County, City or State governments.
Lessee agrees to pay all city and county ad valorem taxes.
15. ATTORNEY'S FEES. In case suit should be brought for recovery of the
premises, or any sum due hereunder, or because of any act which may arise out
of the possession of the premises, by either party, the prevailing party
shall be entitled to all costs incurred in connection with such action
including reasonable attorney's fees.
16. NOTICES. Any notice which either party may, or is required to give,
shall be given by mailing the same, postage prepaid, to Lessee at the
premises, or Lessor at the address shown below, or at such other places as
may be designated by the parties from time to time.
17. HEIRS, ASSIGNS, SUCCESSORS. This lease is binding upon and inures
to the benefit of the heirs, assigns, and successors in interest to the
parties.
18. OPTION TO RENEW. Lessee shall have four five-year options to renew
the lease commencing at the expiration of the initial lease term. All of the
terms and conditions of the lease shall apply during the renewal terms. The
options shall be exercised by written notice given to Lessor not less than
ninety (90) days prior to the expiration of the initial lease term.
19. SUBORDINATION. Lessor warrants and represents that there are no
mechanics' liens or
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any other liens that the leasehold premises is subject to.
20. SPECIAL CONDITIONS. Lessor shall provide a Five Hundred and no/100
($500.00) Dollar credit for missing light fixtures. Lessee will purchase one
(1) fire proof filing cabinet for One Hundred and no/100 (100.00) Dollars.
Lessee shall purchase one (1) antique mantel for Two Hundred and no/100
($200.00) Dollars. Any changes or alterations to the original design as
disclosed by Lessor shall be paid for by Lessee.
21. ASSIGNMENT OF LEASE. Lessor has the right to assign this lease.
22. OTHER CONDITIONS. If any. If none, so state.
23. ENTIRE AGREEMENT. The foregoing constitutes the entire agreement
between the parties and may be modified only by a writing signed by both
parties. The following Exhibits, if any, have been made a part of this lease
before the parties' execution hereof.
Signed MI day of May, 1997.
CASINO RESOURCE CORPORATION, SECURITY FINANCIAL SERVICES, L.L.C.,
Lessee Lessor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇, CEO ▇▇▇▇▇ ▇▇▇▇▇▇, President
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