EHIBIT 10.03
LEASE AND DEVELOPMENT AGREEMENT
THIS LEASE AND DEVELOPMENT AGREEMENT (the "Lease") is
made and entered into as of this 13 day of October, 1995 (the
"Effective Date"), by and between the ST. LOUIS COUNTY PORT
AUTHORITY, a public body corporate and politic of the State of
Missouri ("Landlord"), and SOUTHBOAT LIMITED PARTNERSHIP, a
Missouri limited partnership ("Tenant");
R E C I T A L S
A. Landlord is the owner, subject to the Exceptions
(defined below), of a certain approximately 80 acre parcel of
real estate, together with the structures thereon, located in the
Lemay area of St. Louis County, Missouri (the "County"), as
described on ATTACHMENT A (the "Property"), consisting of a
certain approximately 29 acre site depicted diagrammatically on
ATTACHMENT B (the "Premises") and an approximately 51 acre site
depicted diagrammatically on ATTACHMENT C (the "Adjacent
Parcel").
B. Landlord has been created as a public body corporate
and politic duly organized and existing pursuant to Chapter 68 of
the Revised Statutes of Missouri and is charged with the
responsibility of developing the riverfront area of the
unincorporated portion of St. Louis County. In connection with
such duties and responsibilities, to promote the general welfare,
to encourage capital investment, and to increase the volume of
commerce within the ▇▇▇▇▇ area and of the County generally,
Landlord solicited the submission of proposals for development of
a riverboat and/or barge-based gaming project on the Premises
(the "Project").
C. Tenant submitted to Landlord and the St. Louis County
Council (the "Council"), a certain Project proposal, which
Project proposal was modified and supplemented by subsequent
correspondence to Landlord and the Council (together, the
"Project Proposal").
D. In order to induce acceptance of the Project Proposal
by Landlord and the Council, Tenant agreed to apply to the
Missouri Gaming Commission (the "Commission") for one or more
licenses, as necessary, to operate the Project (including the
Casino, as hereinafter defined) at and from the Premises ("Gaming
Licensure"), to pay certain rentals to Landlord in consideration
of the opportunity to develop and operate the Project, and to
designate the County as the "home dock" for the Project, all as
hereinafter set forth.
E. In order to further induce Landlord and the Council
to approve the Project Proposal, Showboat, Inc., a Nevada
corporation ("Guarantor") and parent company of Showboat ▇▇▇▇▇,
Inc., a Missouri corporation and Tenant's general partner (the
"General Partner"), agreed to issue its unconditional guarantees
(together, the "Guarantees") of (i) payment of the hereinafter
specified minimum rent for 15 years (the "Rent Guarantee") and
(ii) timely completion of construction of and payment for all
Project improvements and installations (the "Completion
Guarantee").
F. In order to promote the economic development of the
▇▇▇▇▇ area and the County, and in consideration of the Project
Proposal, the financial incentives to Landlord, the Guarantees,
the special and unique qualifications of the Guarantor in the
development and operation elsewhere of gaming projects, and the
covenants and promises of the Tenant and the Guarantor under this
Lease and the Guarantees, respectively, Landlord approved the
Project Proposal, and the Council enacted Ordinance Number
17,593, as amended by Ordinance Number 17,739, in support of the
Project Proposal and the execution, delivery and performance of
this Lease.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements of the parties contained herein,
Landlord and Tenant agree as follows:
1. EFFECTIVENESS OF LEASE.
(a) DEMISE OF PREMISES. This Lease shall be deemed
effective as of the Effective Date. Subject to the terms and
conditions of this Lease, Landlord hereby demises and leases to
Tenant, and Tenant hereby leases and takes from Landlord, the
Premises, for the Term (as hereinafter defined).
(b) LANDLORD'S OWNERSHIP. Landlord represents and
warrants to Tenant that Landlord is the owner of the Premises,
subject to the following matters (collectively, the
"Exceptions"): (i) covenants, restrictions, easements, liens,
encumbrances and any other matters of record affecting the
Premises; (ii) present and future federal, state and local zoning
and land use laws, ordinances and restrictions affecting the
Premises or the use thereof; (iii) any state of facts which an
accurate survey or an inspection of the Premises and the
Mississippi River would show; (iv) special assessments now or
hereafter becoming a lien against the Premises; and (v) general
property taxes and assessments for the current and subsequent tax
fiscal years affecting the Premises.
(c) ESCROW AGREEMENT. On the date hereof, Landlord,
Tenant and Guarantor have established an escrow account (the
"Escrow") with Boatmen's Trust Company (the "Escrow Agent")
pursuant to an agreement dated as of the date hereof by and among
Landlord, Tenant, Guarantor and the Escrow Agent (the "Escrow
Agreement"). Guarantor has deposited the Guarantees into the
Escrow, and, not later than 5 business days after the Effective
Date, Tenant shall deposit the $500,000 Acceptance Fee and the
$750,000 Security Deposit (described in Section 7) into the
Escrow. Such deliveries shall be held in trust by the Escrow
Agent in accordance with the Escrow Agreement and the provisions
of Sections 2 and 7 hereof. Landlord also acknowledges receipt
of a copy of the commitment for Project financing obtained by
Tenant in an amount not less than $75 million.
2. TENANT'S DUE DILIGENCE AND PRE-DEVELOPMENT WORK.
(a) AS-IS DELIVERY OF PREMISES. Except as expressly
provided in this Lease, Landlord makes no representation and
provides no warranty to Tenant of any kind whatsoever regarding
(i) the existence or nature of any Exceptions, (ii) the condition
of the Premises or the Mississippi River (including, without
limitation, any environmental matters), (iii) the suitability of
the Premises for any aspect of the Project, or (iv) the
feasibility of Tenant's development and operation of the Project
on, at or from the Premises. Tenant acknowledges receipt from
Landlord of the following: (i) an owner's policy of title
insurance dated October 9, 1987 relating to the Property and
issued by Ticor Title Insurance Company; (ii) a survey dated July
7, 1987 relating to the Property and prepared by Pitzman's & Co.
Surveyors and Engineers, and (iii) certain environmental reports
and studies conducted in respect of the Property dated January
30, 1981, March 12, 1981, January 1986 and June 1986,
respectively, and prepared by Envirodyne Engineers, Inc. Tenant
acknowledges that such materials have been provided solely for
informational purposes to assist Tenant in Tenant's due
diligence, that the same do not constitute representations or
warranties by Landlord or the County, and that Tenant shall rely
on Tenant's own evaluations, inspections and testing of the
Property in determining the suitability of the Premises and the
feasibility of the Project.
(b) SATISFACTION OF CONDITIONS. Tenant shall have a
period of one hundred twenty (120) days following the Effective
Date (the "Due Diligence Period") within which to satisfy or
waive certain conditions subsequent to the continuing
effectiveness of this Lease. Such Conditions relate to the
quality of Landlord's title to the Premises (the "Title and
Survey Condition"), the rezoning of the Premises required by
Tenant (the "Zoning Condition"), Tenant's approval of the
environmental suitability of the Premises (the "Environmental
Condition"), and Tenant's approval of the scope of certain
offsite improvement work which Tenant is required to complete
(the "Offsite Work Condition"), all as described in subsections
(d) through (g) hereof (collectively, "the "Conditions"). During
the Due Diligence Period, Landlord shall make reasonable efforts
to locate all documents in its immediate possession relating to
the Premises and the Adjacent Parcel and to make same available
to Tenant for Tenant's examination (and copying, at Tenant's sole
expense), at Landlord's offices during Landlord's regular office
hours, subject to the same understandings and disclaimers as
govern the delivery of the title policy, survey and environmental
reports described in Section 2(a), and subject to the further
understanding that Landlord makes no representation or warranty
that any documents which are provided Tenant constitute the only
documents in Landlord's possession or control relating to the
Premises and/or the Adjacent Parcel. Except as provided in
subsection (c) below, upon the expiration of the Due Diligence
Period, as a condition to the continuing effectiveness of this
Lease, and notwithstanding any extension of the Due Diligence
Period agreed to by the parties, Tenant shall cause the
Acceptance Fee to be released from the Escrow and delivered to
Landlord. In the event Tenant fails to direct the Escrow Agent
to deliver the Acceptance Fee to Landlord on or before the
expiration of the Due Diligence Period, whether or not Tenant has
satisfied or waived all or any of the Conditions, this Lease
shall be void and of no further force or effect, the Acceptance
Fee, Security Deposit and the Guarantees shall be released to
Tenant, and neither party shall have any further obligation or
liability to the other hereunder; provided, however, that if
Tenant shall have withdrawn or abandoned Tenant's application for
Gaming Licensure or for any Site Permits (as defined in Section
3(b)), or otherwise abandoned the Project, Landlord shall be
entitled to recover the Security Deposit as liquidated damages
for such withdrawal or abandonment.
(c) TENANT'S ACCESS TO PREMISES. Tenant shall have
access to the Premises (and with respect to satisfaction of the
Title and Survey Condition under Section 2(d), to the Adjacent
Parcel) at any and all times after the Effective Date for the
purposes of enabling Tenant to accomplish work desired by Tenant,
at Tenant's sole risk, cost and expense, with regard to the
satisfaction of the Conditions, including, but not limited to,
title work, surveying, environmental testing, evaluation and
inspections of the Premises for determining the feasibility of
the construction and operation of the Project, which inspections
shall include, but shall not be limited to soil tests and
subsurface borings (the "Predevelopment Work"). By undertaking
whatever inspection, investigation or review concerning the
Adjacent Parcel which Tenant deems necessary or appropriate,
Tenant assumes no obligation or liability with respect to the
Adjacent Parcel other than the direct costs and expenses
associated with such inspection, investigation or review of the
Title and Survey Condition of the Adjacent Parcel. It is
understood and agreed that the environmental inspections to be
conducted by Tenant shall include tests for hazardous substances
including, but not limited to, oil drums or barrels, or other
refuse, underground storage tanks, oil substances, printer's ink,
or chemicals in the ground, or on or within the Premises, or
within the water, asbestos, and other waste piles on or below the
surface of the Premises. In the event Landlord or the County
denies Tenant access to the Premises, Tenant shall have the
right, by delivery of written notice to Landlord, to advise
Landlord that Tenant is extending the Due Diligence Period one
day for each day Landlord or the County has denied Tenant access
to the Premises.
(d) TITLE AND SURVEY CONDITION. On or before 30 days
after the Effective Date, Tenant shall obtain, at Tenant's sole
risk, cost and expense, copies of all Exceptions appearing in the
commitment for a leasehold policy of title insurance issued to
Tenant on the Effective Date and a survey of the Premises. In
the event Tenant in its discretion objects to any matter
contained in the commitment or to any of the Exceptions
(including any survey matter or issue raised by such survey and
any matter or issue pertaining to the Adjacent Parcel to the
extent included or referenced in the commitment or survey),
Tenant shall so advise Landlord within 15 days after the
expiration of such 30 day period, whereupon Landlord shall have
10 days within which to advise Tenant whether Landlord will cure
or remove the matter or Exception objected to by Tenant. If
Landlord fails to timely notify Tenant that it will cure or
remove the matter or Exception objected to by Tenant, or elects
not to do so, Tenant shall have the option, if exercised by
delivery of written notice to Landlord not later than 10 days
after expiration of Landlord's 10 day response period, to cancel
this Lease without further obligation or liability on the part of
either party to the other (except that the Escrow Agent shall
release the Guarantees, the Security Deposit and the Acceptance
Fee to Tenant). All matters and Exceptions which are not
objected to, or which are waived, by Tenant shall be deemed
"Permitted Exceptions" for all purposes under this Lease. If
Tenant fails to cancel this Lease within such 10 day period,
Tenant's objection to such Exception or matter shall be deemed
waived.
(e) ZONING CONDITION. Within 30 days after the
Effective Date, Landlord shall apply to the County Planning
Commission for rezoning of the Premises to the "C-8"
classification, so as to enable Tenant to construct and operate
the Project as contemplated by Tenant in the Project Proposal at
and from the Premises; provided, however that Landlord shall not
be obligated to incur any out-of-pocket or third-party costs and
expenses in connection with such application. Tenant shall
provide to Landlord such information and documentation as may be
necessary and appropriate to enable Landlord to apply for the
rezoning. In the event the Premises is not so rezoned (or, if so
rezoned, in the event the conditions of such rezoning are not
acceptable to Tenant in its discretion) pursuant to County
ordinance within 120 days after the Effective Date, Tenant shall
have the option, if exercised by delivery of written notice to
the other party not later than the expiration of such 120 period,
to cancel this Lease without further obligation or liability on
the part of either party to the other (except that the Escrow
Agent shall release the Guarantees, the Security Deposit and the
Acceptance Fee to Tenant). Tenant shall be responsible for
providing the County Planning Commission with all information
required of Tenant by the Commission.
(f) ENVIRONMENTAL CONDITION. On or before 85 days
after the Effective Date, Tenant shall conduct, at Tenant's sole
risk, cost and expense, such inspections, investigations and
evaluations of the Premises as Tenant may require in order to
determine whether any hazardous waste, pollutant, toxic
pollutant, extremely hazardous substance, toxic substance,
infectious waste, solid waste or similar material or substance
(collectively, "Hazardous Substances") shall have been released
on or from the Premises. In the event Tenant in its discretion
determines that Hazardous Substances may impair Tenant's
development, construction, use or operation of the Project,
create unacceptable risks of liability, or cause Project costs to
exceed Tenant's Project budget, Tenant shall so advise Landlord
in writing prior to the expiration of such 85 day period,
whereupon Landlord shall have 20 days within which to advise
Tenant whether Landlord will remediate the condition objected to
by Tenant. If Landlord fails to timely notify Tenant that it
will remediate the environmental condition objected to by Tenant,
or elects not to do so, Tenant shall have the option, if
exercised by delivery of written notice to Landlord not later
than 15 days after expiration of Landlord's 20 day response
period, to cancel this Lease without further obligation or
liability on the part of either party to the other (except that
the Escrow Agent shall release the Guarantees, the Security
Deposit and the Acceptance Fee to Tenant). If Tenant fails to
cancel this Lease within such 15 day period, Tenant shall be
deemed to have accepted the environmental condition of the
Premises, subject only to the provisions of Section 4(g).
(g) OFFSITE WORK CONDITION. On or before 85 days
after the Effective Date, Tenant shall, at Tenant's sole risk,
cost and expense, but with the assistance and full cooperation of
Landlord, conduct such inspections, investigations and
evaluations of highway, traffic, general access and off-site
improvement issues relating to the Premises and access to the
Adjacent Parcel (collectively, the "Access Issues"), including
without limitation the following issues: (i) whether the bridge
to be constructed by Tenant will provide access solely to the
Premises or whether it will service the Adjacent Parcel as well;
(ii) whether additional road work will be required to provide
alternative access to the Adjacent Parcel directly from
▇▇▇▇▇▇▇▇▇▇▇ Road; and (iii) whether and subject to what
requirements access to the Adjacent Parcel at the existing grade
location will be continued during and/or after construction of
the bridge. In the event Tenant in its discretion determines
that such Access Issues may impair Tenant's development,
construction, use or operation of the Project, or cause the cost
of constructing the Project to exceed Tenant's maximum allowable
budget to economically carry out the Project, or create
unacceptable risk or liability, Tenant shall so advise Landlord
in writing prior to the expiration of such 85 day period,
whereupon Landlord shall have 20 days within which to advise
Tenant whether Landlord will cure the condition objected to by
Tenant. If Landlord fails to timely notify Tenant that it will
remediate the Access Issue(s) objected to by Tenant, or elects
not to do so, Tenant shall have the option, if exercised by
delivery of written notice to Landlord not later than 15 days
after expiration of Landlord's 20 day response period, to cancel
this Lease without further obligation or liability on the part of
either party to the other (except that the Escrow Agent shall
release the Guarantees, the Security Deposit and the Acceptance
Fee to Tenant). If Tenant fails to cancel this Lease within such
15 day period, Tenant shall be deemed to have accepted all Access
Issues.
(h) LANDLORD'S OBLIGATIONS. In connection with
Tenant's review of matters relating to the Conditions, Landlord
agrees to cooperate with Tenant and to use its best efforts to
cure any objection raised by Tenant which Landlord, as owner of
the Premises, has the ability to cure; provided, however, such
"best efforts" shall not be deemed to require Landlord to
undertake litigation or to pay monies to third parties or to
Tenant. In electing to cure any objection raised by Tenant,
Landlord shall advise Tenant concerning the manner and timing of
such cure, and Tenant shall have the right to approve or
disapprove such matters. Failure of the parties to agree as to
the manner or timing of the cure offered by Landlord shall have
the same effect as though Landlord had not offered to cure such
objection.
(i) ACCEPTANCE OF PREMISES. Tenant's satisfaction or
waiver of each of the Conditions shall constitute Tenant's "AS
IS" acceptance of the Premises, subject only, if applicable, to
(i) the occurrence of the Commencement Date, as defined in
Section 3(a), (ii) Landlord's full compliance with any commitment
made by Landlord to satisfy any objection raised by Tenant, and
(iii) any termination of this Lease occurring pursuant to Section
4(g). The date Tenant has accepted or is deemed to have accepted
the Premises pursuant to this Section 2(i) shall be referred to
herein as the "Acceptance Date." On the Acceptance Date, the
$500,000 Acceptance Fee shall be unconditionally and irrevocably
released to Landlord by the Escrow Agent, and the Guarantees and
Security Deposit shall remain subject to Escrow until released to
Landlord or Tenant in accordance with the provisions of Section
3. From and after the Effective Date, Landlord shall not subject
the Premises to any liens or encumbrances not expressly permitted
by this Lease without the prior written consent of Tenant.
3. TERM OF LEASE.
(a) COMMENCEMENT DATE. The term of this Lease (the
"Term") shall commence (the "Commencement Date") if at all, at
such time as the following have occurred: (i) the Commission
commences the investigation of Tenant (the "Investigation")
incident to Tenant's application for Gaming Licensure (the
"Investigation Date"); and (ii) Tenant has obtained all Site
Permits (as defined in Section 3(b)) (the "Site Permit Date").
The Term shall expire on the 99th anniversary of the day prior to
the Commencement Date. Each successive 12 month annual period
occurring subsequent to the Commencement Date shall be deemed a
"Lease Year" for all purposes under the Lease. Landlord and
Tenant shall each execute a memorandum prepared by Landlord and
reasonably acceptable to Tenant confirming the Commencement Date
of this Lease, such memorandum to become an attachment to this
Lease.
(b) SITE PERMITS AND GAMING LICENSURE. As used in
this Lease, the term "Site Permits" shall mean all permits or
licenses issued by the U.S. Army Corps of Engineers (the "Corps")
or by other governmental bodies to enable Tenant to commence
dredging of the Mississippi River, and for site development,
grading and excavation work on the Premises, including, without
limitation, the Corps' Section 10 and 404 Permits, a flood plain
development permit, a metro sewers and highway permit and a site
plan approval permit, but excluding any building or construction
permits required to enable Tenant to commence or complete the
construction of Tenant's Project improvements or to occupy and
operate the Project. Tenant shall make application for all Site
Permits at the earliest practical opportunity, without regard to
the status of the Investigation. Tenant shall use its best
efforts to obtain the Site Permits and Gaming Licensure, and
Landlord shall fully and actively support, endorse and diligently
assist Tenant in such efforts, provided Landlord shall not be
obligated to incur any out-of-pocket or third party expenses for
Tenant's benefit or pay any monies to Tenant. Tenant agrees to
file the application for Gaming Licensure with the Commission as
promptly as possible after the Effective Date and in no event
later than 30 days after the Effective Date, and to deliver to
Landlord a copy of the transmittal correspondence for Tenant's
application to the Commission and a copy of each and every
material notice delivered to or received from the Commission by
Tenant. As used in this subsection (b), a "material notice"
shall be any notice substantively bearing upon the availability
of Gaming Licensure or the Site Permits or affecting the
occurrence of the Commencement Date or Project Opening. Tenant
shall not withdraw Tenant's application for any of the Site
Permits or for Gaming Licensure prior to any termination of this
Lease.
(c) EARLY DEFEASANCE OF LEASE. Landlord or Tenant
shall have the right to terminate this Lease pursuant to
subsection (d) if, for any reason other than an Unavoidable Delay
(as defined in Section 30) or a delay caused by Landlord or the
County, any of the following conditions occur:
(i) notwithstanding Tenant's diligent pursuit of
Gaming Licensure, if the Investigation Date has not occurred on
or before the expiration of the 14 month period commencing on the
Effective Date (the "Investigation Deadline") or Tenant
reasonably determines, based on communications with or
information received from the Commission staff, that the
Commission will not commence the Investigation before the
Investigation Deadline; or
(ii) the Site Permit Date has not occurred on or before
the expiration of the 9 month period commencing on the
Investigation Date (the "Site Permit Deadline") or the Corps
officially notifies Tenant that it will not permit the
construction or operation of the Project as contemplated in this
Lease; provided, however, in the event (i) the Investigation Date
has timely occurred, (ii) Tenant has obtained all Site Permits
other than the Site Permits to be issued by the Corps (or
issuance of the remaining Site Permits is contingent solely on
issuance of the Corps' Site Permits), and (iii) the Corps has
not officially notified Tenant that it will not permit the
operation of the Project at the Premises, Tenant shall have the
option to extend the Site Permit Deadline for 3 successive
periods of 60 days each by delivery of written notice of such
election to Landlord not sooner than 30 days prior to, and not
later than, the Site Permit Deadline; provided, however, Tenant
has made diligent efforts to secure the Site Permits to be issued
by the Corps and has cooperated with the Corps by responding in a
reasonably timely fashion to requests for information or proposed
plan changes from the Corps.
(d) TERMINATION NOTICE. Termination of this Lease
pursuant to subsection (c) shall be accomplished by delivery of
written notice to the non-terminating party of such election on
or before the Investigation Deadline or the Site Permit Deadline,
as the case may be (a "Termination Notice"); provided, however,
that no such Termination Notice shall be effective unless the
terminating party shall have sent an initial notice advising the
non-terminating party of its intent to terminate this Lease at
least 30 days prior to the date of the Termination Notice. Upon
the effective date of such termination, the Escrow Agent shall
release the Guarantees and the Security Deposit to Tenant unless
Tenant shall have withdrawn or abandoned Tenant's application for
Gaming Licensure or for any of the Site Permits or otherwise
abandoned the Project, in which event, the Security Deposit shall
be subject to disposition in accordance with the terms of this
Lease, notwithstanding any termination of this Lease.
(e) POST-COMMENCEMENT DATE DEFEASANCE. From and after
the Commencement Date, this Lease may be terminated solely upon
the discovery of Hazardous Substances beneath the surface of the
Premises not detected by Tenant during the Due Diligence Period
and costing more than $3 million to remediate, or upon the repeal
or invalidation of the law permitting gaming in the State of
Missouri and consequent cessation of Tenant's business at the
Premises, or upon the occurrence of a casualty or condemnation,
or an Event of Default, all in accordance with the applicable
provisions of Sections 4(g), 11(c), 15, 16 or 25, respectively.
4. PROJECT CONSTRUCTION AND DEVELOPMENT.
(a) SUBMISSION AND APPROVAL OF PLANS. Prior to
commencement of the Work, Tenant shall submit to Landlord for
Landlord's approval, a final site plan, footprints, utility
plans, exterior renderings, elevations and offsite improvement
plans (together, the "Plans") and a proposed schedule of the Work
(the "Work Schedule") for the construction and development of the
Project on the Premises (the "Work"), including the riverboat or
barge-based gaming facility and related installations (or, if
permitted by the Commission, improvements and installations for
dockside gaming) at the Premises (together, the "Casino").
Landlord's approval of the Plans shall not be unreasonably
withheld or delayed. In all events, Landlord shall approve or
disapprove any proposed Plans within 10 business days after
Landlord's receipt of same, and any disapproval shall be specific
as to the reasons. Tenant shall be given adequate time and
opportunity to correct such matters which Landlord has identified
as the basis for such disapproval. If Landlord does not approve
or disapprove such Plans within 10 business days after Tenant's
submission, then such Plans shall be deemed approved for all
purposes under this Agreement. Landlord agrees that the Premises
shall be subject to any utility easements referenced in the
approved Plans and to execute such easement agreements for the
benefit of the Project. Landlord's approval of the Plans shall
not be deemed to constitute acceptance by Landlord of any
liability in connection with the Plans or the Work, such
liability and risk being expressly and exclusively borne by
Tenant. Landlord shall not be deemed to be acting unreasonably
in withholding its consent to the Plans proposed by Tenant if the
Plans constitute a material change from the preliminary site plan
set forth in ATTACHMENT D; provided, however, that roadway access
to the Premises, as depicted on ATTACHMENT D, may be reconfigured
by the parties in connection with Tenant's resolution of the
Access Issues. The procedures set forth in this Section 4(a)
shall apply with respect to any changes to the approved Plans
proposed by Tenant.
(b) CONSTRUCTION AND OCCUPANCY PERMIT APPLICATIONS.
Tenant, at Tenant's sole cost and expense, shall apply for all
permits required to enable Tenant to commence and complete the
construction of Project improvements (the "Construction Permits")
and to occupy and operate the Project (the "Occupancy Permits"),
and Tenant shall prepare all engineering and construction
documents required to apply for or comply with the terms of any
Construction Permit. Landlord shall endorse and support Tenant's
Permit applications to the extent the same are materially
consistent with the approved Plans; provided Landlord shall not
be required to incur any out-of-pocket or third-party costs or
expenses in connection therewith.
(c) DELIVERY OF PREMISES. The Premises shall be made
available to Tenant for commencement of the Work from and after
the Commencement Date, provided Tenant has first obtained such
Permits (Site Permits or Construction Permits, as the case may
be) as are necessary for commencement of the applicable Work,
executed and delivered the necessary construction contracts,
established the construction disbursing escrow and delivered to
Landlord the insurance certificates, contract assignments,
consents and bonds provided for in Section 4(e). Prior to
commencing any Work on or at the Premises, Tenant, at Tenant's
sole risk, cost and expense, shall cause a resubdivision plat and
revised legal description of the Premises to be prepared by a
licensed Missouri surveyor in accordance with ATTACHMENT B and
submitted to Landlord for Landlord's review and approval, which
approval shall not be unreasonably withheld. The legal
description of the Premises shall become ATTACHMENT E to this
Lease. The resubdivision plat shall be sufficient to enable
Landlord to cause the Premises to be lawfully subdivided from the
Adjacent Parcel and shall be consistent with Tenant's
contemplated ingress and egress by the public to the Project and
Tenant's access to service roads and work areas as shown on the
Project design plans and renderings. Landlord agrees to
cooperate fully with Tenant in connection with Tenant's
preparation of the legal descriptions and resubdivision plat, but
at no out-of-pocket or third-party cost or expense to Landlord,
except that Landlord shall bear the cost of any surveying of the
Adjacent Parcel required to effect the resubdivision and any
other resubdivision costs allocable to the Adjacent Parcel, with
any such allocation between Tenant and Landlord to be based on
the relative size of the parcels unless the cost in question
relates solely to one parcel.
(d) COORDINATION AND INSPECTION OF WORK. Landlord
shall have the right to inspect and monitor the progress of the
Work during regular business hours, on reasonable prior notice to
Tenant and without material interference with the Work. Tenant
shall advise Landlord as to any material claim pending or
threatened by or against Tenant or otherwise involving the
Project and of any anticipated delays in Project Opening. Within
30 days after the Effective Date, Tenant and Landlord shall each
designate one or more "Project Representatives" who shall provide
liaison services between the Tenant and Guarantor and contractors
and consultants working on the Project on one hand and Landlord
and officials and departments of the County on the other. The
Project Representatives shall confer by telephone and fax
communication, and shall meet with each other regularly or
otherwise on reasonable prior request for the purpose of
conveying and obtaining information and approvals required in
connection with the Work. Notices provided by Project
Representatives shall be sent and received in accordance with the
provisions of Section 29 regarding delivery of Notices.
(e) THE WORK. After the Commencement Date, Tenant
shall proceed with reasonable diligence to obtain all
Construction Permits not theretofore obtained by Tenant, to
commence and complete the Work in accordance with the Plans and,
subject only to Unavoidable Delays and delays caused by Landlord
or the County, the Work Schedule, and to obtain all Occupancy
Permits and to open the Project (including the Casino) to the
public ("Project Opening"). All Work shall be performed by
Tenant at the sole risk, cost and expense of Tenant (i) in a
first class, workmanlike manner, (ii) free of liens for labor and
materials (subject to Tenant's right to contest liens as provided
in this Lease), (iii) subject to commercial liability, builder's
risk and worker's compensation insurance coverage required under
this Lease, (iv) free of all other claims against Landlord or the
Project (subject to Tenant's right to contest liens as provided
in this Lease), (v) in compliance with the Permits and all
applicable laws, regulations, ordinances and codes ("Governmental
Requirements"), and (vi) as to the Work performed on the Premises
only, (a) subject to fully-funded construction disbursing escrows
with properly qualified, licensed and bonded contractors, and (b)
pursuant to contracts permitting assignment of Tenant's interest
thereunder to the Guarantor and the consent of the contractors to
such assignment (collectively, the "Work Requirements"). Tenant
shall be responsible for timely delivery to Landlord of all
insurance certificates, construction contracts, bonds,
construction disbursing escrows, collateral assignments of
construction contracts and the contractors' consents thereto.
Tenant shall deliver to Landlord a certificate of Substantial
Completion of the Work issued by Tenant's architect, and Tenant
shall provide evidence of payment of all construction costs. As
used herein, "Substantial Completion" shall mean that only
insubstantial details of finish construction and installation
remain to be performed, and that the Project may nonetheless be
opened to the public. Tenant agrees that all punch-list items
shall be completed as soon as reasonably practical and in no
event later than 180 days after Substantial Completion. Tenant
shall deliver to Landlord a certificate of Final Completion
issued by Tenant's architect and evidencing the completion of all
punch-list items.
(f) CONTROL OF WORK. Landlord and Tenant agree,
subject to the provisions of the Project Proposal applicable to
the employment or engagement of local persons or companies,
minorities and women or companies owned by minorities and women,
which provisions are hereby incorporated into this Lease by this
reference, and subject further to applicable Governmental
Requirements, that performance of the Work shall be subject to
the following terms and conditions: (i) Tenant shall have the
sole and exclusive right to select any architect, construction
manager, general contractor and engineer in connection with the
design and construction of the Project; (ii) Tenant shall have
the sole and exclusive right to select any additional
subcontractors, materialmen, suppliers or any other persons or
companies in connection with the construction of the Project; and
(iii) Tenant shall have the sole and exclusive right to manage,
direct, control, coordinate and prosecute the completion of the
Project, and Landlord shall cooperate fully in such regard, but
at no cost or expense to Landlord.
(g) UNDETECTED CONTAMINATION. In the event Tenant,
after commencement of the Work and not later than the date of
Project Opening, discovers Hazardous Substances beneath the
surface of the Premises which were not detected during the Due
Diligence Period or, if detected, the extent of which was not
fully ascertained by Tenant's "Phase II" work during the Due
Diligence Period, and which must be remediated in order to meet
applicable Governmental Requirements, and in the event the cost
to remediate such Hazardous Substances shall equal or exceed $3
million, Tenant shall have the option, by delivery of written
notice to Landlord within 90 days after Tenant's discovery of
such Hazardous Substances, accompanied by a written bid of
Tenant's contractor confirming such $3 million or greater
remediation cost, to terminate this Lease without further
obligation or liability to Landlord, such termination to take
effect no earlier than the date Tenant shall have (i) paid all
costs incurred by Tenant in connection with the Work, (ii)
installed warning signs and perimeter fencing to secure access to
any area made dangerous by Tenant's excavations, and (iii)
surrendered the Premises to Landlord, free and clear of Tenant's
construction equipment and materials. Landlord shall not be
obligated to refund to Tenant the Acceptance Fee, the
Commencement Date Fee (defined in Section 5(a)(i)), or any
prepaid Annual Rent, and Landlord's agreement with respect to the
cure of any objection raised by Tenant shall be void and of no
further force or effect. Tenant shall provide Landlord with
copies of all reports, test results and evaluations of Hazardous
Substances discovered beneath the Premises.
(h) PROJECT OPENING. Upon, and as a condition to,
Project Opening, Tenant shall pay the Project Opening Fee
described in Section 5(a)(ii). On or before the date of Project
Opening, the parties shall execute a memorandum prepared by
Landlord and reasonably acceptable to Tenant establishing the
Project Opening date (and the date payments of Minimum Rent or
Percentage Rent, as the case may be, shall be due under Section
5), which memorandum shall become an attachment to this Lease.
5. RENT.
(a) KEY DATE PAYMENTS AND ANNUAL RENT. Tenant shall
pay to Landlord, without setoff or deduction, by corporate or
cashiers check or by wire transfer as directed by Landlord in
immediately available U.S. funds, the following rentals
(collectively, "Rent"):
(i) $2.5 million on the
Commencement Date (the "Commencement Date
Fee");
(ii) $2.5 million on the date of
Project Opening (the "Project Opening Fee");
and
(iii) as annual rent ("Annual
Rent"),
(A) commencing on the
Commencement Date and continuing until
the date of Project Opening, $2 million
per annum, payable in equal monthly
installments, and
(B) commencing on the
date of Project Opening and continuing
until the expiration of the Term, the
greater of (a) 4% of Adjusted Gross
Receipts ("AGR") ("Percentage Rent") or
(b) applicable Minimum Rent.
(b) MINIMUM RENT. As used in this Lease, the term
"Minimum Rent" shall mean $3 million during the 1st 12 month
period occurring after Project Opening, $2.8 million during the
2nd 12 month period occurring after Project Opening, $2.6 million
during the 3rd 12 month period occurring after Project Opening,
$2.4 million during the 4th 12 month period occurring after
Project Opening, $2.2 during the 5th 12 month period occurring
after Project Opening, and $2 million commencing on the 5th
anniversary of the date of Project Opening and continuing through
Lease Year 15. Minimum Rent shall be increased by 10% on the
first day of each successive 10th Lease Year occurring during the
Term, commencing with Lease Year 16.
(c) PAYMENT OF ANNUAL RENT. From the Commencement
Date until the date of Project Opening, Annual Rent shall be paid
in equal monthly installments, with each installment equal to
1/12th of the applicable Minimum Rent. On the date of Project
Opening, Annual Rent shall be paid on a monthly basis as provided
in Section 5(a)(iii)(B). In the event the Commencement Date, the
date of Project Opening, or the date the Term expires occurs on a
date which is not the first day of a month, the relevant monthly
installment of Annual Rent shall be prorated per diem, based on
the number of days of such month included within the applicable
Rent period. Payments of Annual Rent shall be subject to
quarterly adjustment as provided in this subsection (c) in the
event and to the extent Minimum Rent accruing for such quarterly
period is exceeded by Percentage Rent (4% x AGR) accruing for
such quarterly period. As used in this Lease, the term "Adjusted
Gross Receipts" or "AGR" shall mean the gross receipts from
licensed gambling games and devices less winnings paid to
wagerers and the 20% tax paid to the State of Missouri pursuant
to Section 318.822 of the Revised Missouri Statutes. In the
event Percentage Rent exceeds Minimum Rent during any quarter,
Tenant shall pay such difference to Landlord, as an adjustment to
Minimum Rent, not later than 45 days after the end of each
quarter. At the end of each Lease Year, Tenant shall be entitled
to a credit against Rent next due to the extent of any
overpayments of Percentage Rent made by Tenant during such Lease
Year. Tenant shall report AGR to Landlord on a quarterly basis
in accordance with the provisions of Section 13.
6. TRIPLE NET OBLIGATION. The Lease shall be what is
commonly known as a "Triple Net" Lease, and Tenant shall be
responsible for the full and timely performance of all
obligations and payment of all costs, charges, fees, expenses and
other sums incurred by or for Tenant's benefit in connection with
Tenant's ownership, leasing, construction, development,
equipping, management, maintenance, repair, replacement,
operation or use of the Project or any component thereof,
including without limitation all salaries, fees, commissions,
rentals, license or permit fees, loan or mortgage payments,
utility charges, trash, sewage and waste water disposal charges,
fuel charges, insurance premiums and deductibles, and all general
real estate, ad valorem, sales, use and other taxes and
assessments, special or general, allocable to the Premises, the
Project or the leasehold estate of Tenant. All sums other than
Rent payable by Tenant hereunder, including without limitation
the Acceptance Fee and the amounts due Landlord pursuant to this
Section 6 (whether directly or by reimbursement of any sum paid
by Landlord to a third party in the cure of a default by Tenant
as permitted under this Lease) shall be deemed "Additional Rent"
as to which Landlord shall have the same rights and remedies for
enforcement of payment and collection as Landlord has in respect
of Rent.
7. SECURITY DEPOSIT. Until the occurrence of the
Commencement Date and payment of the Acceptance Fee, the
Commencement Date Fee, and the first installment of Annual Rent,
Landlord and Tenant shall maintain the Escrow established with
the Escrow Agent. The Escrow shall secure Landlord against the
possibility that Tenant shall withdraw or abandon Tenant's
application for Gaming Licensure or for any Site Permits, or
otherwise abandon the Project, in which event Landlord shall be
entitled to terminate this Lease and, as Landlord's sole remedy,
to retain the sum deposited into Escrow as liquidated damages and
not as a penalty, the parties not being able to determine
Landlord's actual damages prior to the Commencement Date. Not
later than 5 business days after the Effective Date, Tenant shall
deposit into the Escrow $750,000 or a 6-month (or longer)
irrevocable letter of credit in the stated amount of $750,000
issued by a bank or financial institution acceptable to Landlord
(the "Security Deposit"), and permitting draws (and deposit into
the Escrow of the resulting cash) upon unilateral presentation to
the issuer of Landlord's certificate that Tenant has withdrawn or
abandoned Tenant's application for Gaming Licensure or for any
Site Permits, or otherwise abandoned the Project, or that Tenant
has failed to renew or replace the letter of credit within 30
days prior to its stated expiration. Upon delivery to the Escrow
Agent of Landlord's certification that Tenant has withdrawn or
abandoned Tenant's application for Gaming Licensure or for any
Site Permits, or otherwise abandoned the Project, the Escrow
Agent shall be authorized and directed to interplead into the St.
Louis County Circuit Court for disposition by the Court the cash
sum deposited into the Escrow (including cash drawn from the
letter of credit), under the terms of the Escrow Agreement and
this Lease. Within 5 business days after cancellation of this
Lease in accordance with the provisions of Section 2(b) or
Section 3(d), or within 5 business days after the occurrence of
the Commencement Date, Landlord shall deliver its certificate to
the Escrow Agent, and the Escrow Agent shall be authorized and
directed, under the terms of the Escrow Agreement, to immediately
release to Tenant the cash or letter of credit deposited in the
Escrow by Tenant. Upon the Commencement Date and payment of the
Acceptance Fee, the Commencement Date Fee and the first
installment of Annual Rent, the Security Deposit shall be
promptly refunded to Tenant.
8. REPRESENTATIONS AND WARRANTIES.
(a) In order to induce Landlord to enter into this
Lease, Tenant makes the following representations and warranties
to Landlord, all of which representations and warranties shall be
deemed restated as of the Commencement Date:
(i) Tenant is duly formed and validly
existing as a Missouri limited
partnership;
(ii) the General Partner is duly formed and
validly existing as a Nevada corporation;
(iii) the execution and delivery of this
Lease and the performance by Tenant of
Tenant's obligations hereunder have been
duly authorized by all requisite corporate
and partnership action;
(iv) this Lease constitutes the legal, valid
and binding obligation of Tenant and is
enforceable against Tenant in accordance
with its terms;
(v) no litigation is pending or, to the best
of Tenant's knowledge, threatened against
Tenant which, if adversely determined,
would likely have a material adverse
impact on Tenant or the Project;
(vi) Tenant is not a party to, and neither
Tenant nor Tenant's properties, real or
personal, are subject to, any agreement,
order, proceeding, ruling or other matter
in conflict with any provision of this
Lease or which materially and adversely
affects its ability to perform its
obligations hereunder;
(vii) Tenant is solvent and is not a party to
any assignment for the benefit of
creditors or bankruptcy proceeding; and
(viii) Tenant is not in material default of
any contract or agreement to which it is a
party which materially and adversely
affects Tenant's ability to perform its
obligations under this Lease.
(b) In order to induce Tenant to enter into this
Lease, Landlord makes the following representations and
warranties to Tenant, all of which representations and warranties
shall be deemed restated as of the Commencement Date:
(i) Landlord is a corporate and political body
lawfully existing and in good standing under
the laws of the State of Missouri and has
the power and authority to enter into this
Lease,
and the execution and delivery of this Lease
and the performance by Landlord of Landlord's
obligations hereunder have been duly
authorized by all requisite governmental
action;
(ii) this Lease constitutes the legal, valid and
binding obligation of Landlord and is
enforceable against Landlord in accordance
with its terms;
(iii) no litigation is pending or, to the best
of Landlord's knowledge, threatened against
Landlord which, if adversely determined,
would likely have a material adverse impact
on the Project;
(iv) Landlord is solvent and is not a party to
any assignment for the benefit of creditors
or bankruptcy proceeding;
(v) Landlord is not a party to any agreement,
order, proceeding, ruling or other matter in
conflict with any provision of this Lease;
and
(vi) Landlord is not in default of any contract
or agreement to which it is a party which
materially and adversely affects its ability
to perform its obligations under this Lease.
9. USE OF PREMISES AND QUIET ENJOYMENT.
(a) DESIGNATED USE. Tenant shall use the Premises for
the operation of a Casino containing a minimum of 26,000 square
feet of Las Vegas style gaming area and for related, supporting
infrastructure, including without limitation a parking lot,
lighting, signage and such additional installations as are
required by Tenant in connection therewith. In addition to the
Casino, Tenant may operate on the Premises such restaurants, bars
and/or stores, as Tenant may in its discretion determine.
(b) ALTERATIONS AND IMPROVEMENTS. Subject to the
provisions of Section 9(a), Tenant may from time to time, at
Tenant's sole risk, cost and expense, make alterations and
improvements, (i) without Landlord's prior written consent, to
the interior, non-structural components of the Premises which do
not reduce the minimum square footage devoted to Casino gaming,
and (ii) with Landlord's prior written consent, which consent
shall not be unreasonably withheld or delayed, to the exterior or
structural components of the Project; provided, however, that
Landlord shall not be required to consent to any reduction in the
square footage of the Project devoted to Casino gaming. In the
event of a dispute between the parties as to whether Landlord's
consent is required or has been unreasonably withheld, the issue
shall be submitted to binding arbitration in accordance with the
procedures of Section 31. In order to rule in favor of Landlord,
the arbitrators must determine that such proposed new
construction would be detrimental to the Project and Landlord's
realization of the benefits of this Lease.
(c) COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. During
the Term, Tenant shall, at its sole cost and expense, promptly
observe and comply with all Governmental Requirements and the
requirements of all insurance companies writing policies covering
the Casino or the parking areas, streets, sidewalks, vaults,
curbs and gutters included within the Project, or the use and
occupation or franchises and privileges connected therewith,
whether or not such Governmental Requirements or insurance
requirements shall necessitate structural changes, improvements,
interference with the use and enjoyment of the Project,
replacements or repairs, extraordinary as well as ordinary,
foreseen or unforeseen. The Casino shall be located within the
Project in such a manner so as not to violate any applicable
Gaming Licensure requirements of the Commission or any Permits
obtained by Tenant. Tenant shall pay all costs, expenses,
claims, fines, penalties and damages that may in any manner arise
out of or be imposed because of the failure of Tenant to comply
with any of the foregoing requirements.
(d) PERMITTED CONTESTS. Tenant, after notice to
Landlord, may, by appropriate legal proceedings conducted at
Tenant's sole expense, contest in good faith the validity or
enforcement of any Governmental Requirement and may defer
compliance therewith, provided that (i) such noncompliance shall
not constitute a crime, (ii) Tenant shall diligently prosecute
such contest to final determination by a court, governmental
authority, agency, department or other body having final
jurisdiction, (iii) the contest conducted by Tenant will not
operate to extend the Investigation Deadline or the Permit
Deadline, and (iv) the contest conducted by Tenant will not
result in the closing of the Project, any foreclosure or
forfeiture of Tenant's leasehold estate or the imposition of any
charge, fine, lien, penalty or claim against Landlord. Tenant,
after notice to Landlord, may, by appropriate legal proceedings
conducted at Tenant's sole expense, contest in good faith the
validity of any lien for labor or materials imposed against
Tenant or the Project, provided that Tenant first discharges
such lien from the records of the County by posting of bond or
other security reasonably adequate to secure Tenant's
performance, and provided further that such contest will not
result in the closing of the Project or any foreclosure or
forfeiture of Tenant's leasehold estate.
(e) QUIET ENJOYMENT. Landlord covenants and agrees
that Tenant shall be entitled to lawfully and quietly hold,
occupy and enjoy the Premises during the Term without hindrance
or interference by Landlord or by any party claiming by, through
or under Landlord, in accordance with and subject to the terms
and conditions of this Lease.
10. EXCLUSIVITY AND RESTRICTIVE COVENANT.
(a) GRANT OF EXCLUSIVITY. To the fullest extent
permitted by law, and subject only to the provisions of Section
10(b), Landlord hereby grants to Tenant and its permitted
successors and assigns, for a period commencing on the Effective
Date and continuing through the 15th Lease Year (the "Exclusive
Rights Period"), the exclusive right to operate any type of
excursion gaming boat, land based or other type of gaming or
gambling facility or facilities on any property which is at any
time during the Exclusive Rights Period owned or controlled by
Landlord and located south of the River des ▇▇▇▇▇ or, with
respect to the development thereof or to uses which may be made
thereof by the owner, tenant or occupant, under the
administrative jurisdiction of Landlord. Such exclusive rights
shall include an obligation on the part of Landlord to not
authorize, endorse, support or otherwise assist, directly or
indirectly, in connection with issuance by any governmental
entity of any license or permit to or for the development or
operation of any potentially competing gaming project south of
the River des ▇▇▇▇▇ for the duration of the Exclusive Rights
Period.
(b) CONDITIONS OF GRANT. Landlord's grant to Tenant
of exclusivity is subject to the following express conditions:
(i) the Casino shall remain in operation after Project Opening;
(ii) no Event of Default shall have occurred and be continuing
under this Lease on the part of Tenant or on the part of the
Guarantor under the Guarantees; (iii) Tenant and Guarantor shall
honor the restrictive covenant contained or referenced in Section
10(c); and (iv) Tenant shall not earn more than $200 million in
AGR during any Lease Year.
(c) RESTRICTIVE COVENANT. Tenant covenants and agrees
that during the Exclusive Rights Period, Tenant shall not
participate in any manner in the ownership, sponsorship,
control, management, operation or use of any riverboat gaming
facility along either the Illinois or Missouri banks of the
Mississippi River from the southern boundary of the City of St.
Louis to the northern boundary of Jefferson County. Tenant
acknowledges that the restrictive covenant contained in this
Section 10(c) (and issued by the Guarantor under the Rent
Guarantee) is reasonable under all of the circumstances.
(d) RIGHT OF FIRST REFUSAL. In the event Landlord
shall elect to support issuance of a second gaming license south
of the River des ▇▇▇▇▇ because Tenant has earned more than $200
Million in AGR during any Lease Year, and provided Tenant and
Guarantor are in compliance with the conditions described in
clauses (i), (ii) and (iii) of Section 10(b), Landlord shall
grant Tenant a 90-day right of first refusal to commit in writing
to construct and operate a second gaming project in
unincorporated St. Louis County at a mutually acceptable location
(and on terms and conditions mutually acceptable to the parties)
which, if constructed and opened for operation by Tenant within
24 months after Tenant's election (which 24 month period shall be
subject to extension on account of Unavoidable Delays), shall
operate, so long as the Tenant and Guarantor are in compliance
with respect to clauses (i), (ii) and (iii) above, as the same
pertain to both projects, to divest Landlord of the right to
implement or to authorize the implementation of any proposal from
another prospective tenant, developer or operator of a second
gaming facility, whether the proposal in question involves the
sale, lease or licensing of property owned or leased by Landlord
or Landlord's support before the Commission and the Council with
respect to an operation proposed to be located on privately-owned
land. Tenant's failure to elect to construct and operate a
second gaming project by timely written notice to Landlord shall
constitute a waiver of Tenant's right of first refusal, unless
Landlord's proposal does not result in a sale or lease of the
site in question, in which event Tenant's right of first refusal
shall be deemed reinstated. Landlord agrees to lend all
reasonable cooperation to Tenant in connection with any timely
exercise by Tenant of Tenant's right of first refusal to
construct and operate a second gaming project. In the event of a
dispute between Landlord and Tenant regarding any aspect of
Tenant's specific plans for the construction and operation of a
second gaming project or the terms of a lease or other agreement
with Landlord with respect to such second gaming project (other
than rent, which shall be equal to the then-current Rent payable
under this Lease), either party shall have the right to submit
such dispute to binding arbitration in accordance with the
procedures of Section 31.
(e) MEMORANDUM OF RESTRICTIVE COVENANT. The
provisions of this Section 10 shall be incorporated into a
memorandum prepared and recorded by Landlord against the Adjacent
Parcel and any property now or hereafter owned by Landlord and
located south of the River des ▇▇▇▇▇.
11. COVENANT OF CONTINUOUS OPERATION.
(a) MAXIMIZATION OF REVENUES. The Project (including
the Casino and any barges utilized in connection with the
Project, and all structures, parking lots, driveways,
landscaping, fencing, lighting and signage), shall be maintained,
managed, operated, staffed, serviced, equipped and repaired in a
first class manner, in accordance with all Governmental
Requirements, insurance requirements and the highest standards of
similar projects operating along and from the Mississippi and
Missouri Rivers. The Casino shall remain in operation 24 hours a
day, 7 days a week, 365 days a year, so as to maximize the
opportunity of Landlord to earn Percentage Rent under Section
5(a)(iii), except to the extent limited by applicable
Governmental Requirements, Unavoidable Delays, casualty or
condemnation or by repairs, replacements or alterations made by
Tenant in accordance with the provisions of Section 9. Tenant
shall provide a reasonably adequate complement of properly
trained and equipped security personnel for the Project at all
times.
(b) PARTICULAR OPERATIONS. The Project and all
Project signage shall be fully illuminated at all times during
which the Project is open. Subject to applicable laws, Tenant
shall have the right to erect or affix such signs and banners as
Tenant may require in its discretion for directional,
informational, promotional or advertising purposes upon windows,
doors and walls (interior and exterior) of Project structures and
otherwise on or about the Project. All signs and banners shall
be in good taste and generally consistent with the themes and
aesthetics of the Project.
(c) ILLEGALITY OF GAMING OPERATIONS. Notwithstanding
the foregoing provisions of this Section 11, in the event casino
gaming shall become illegal in the State of Missouri by virtue of
legislative action taken by the Missouri General Assembly,
popular referendum or otherwise, and in the further event that
the Casino is closed for a period of 30 consecutive days due to
such legal impediment, then either party shall have the right to
cancel this Lease by delivery of written notice of such election
to the other party at any time prior to the date casino gaming
again becomes legal in the State of Missouri. For so long as the
Project remains closed due to such legal impediment, Tenant's
obligation to operate the Project and to pay Rent shall be
suspended. Landlord or Tenant shall have the right but not the
obligation to contest the validity of any legal impediment to the
operation of the Project arising under this subsection (c), and
in the event either party elects to contest such impediment, the
other party shall lend all non-financial assistance reasonably
required by the contesting party; provided, however, Tenant shall
not be obligated to participate in or assist Landlord in
connection with such contest if the Project is closed for 30 days
due to such legal impediment and either party elects to cancel
this Lease as provided in this subsection (c).
12. ASSIGNMENT AND SUBLETTING.
(a) LANDLORD'S CONSENT GENERALLY. No assignment or
subletting (including licensing) shall be allowed without the
prior written consent of Landlord, which consent shall not be
unreasonably withheld. In no event shall any assignment or
subletting operate to release Tenant from any liability under the
Lease or to release Guarantor from any liability under the
Guarantee or constitute permission for any further subletting or
assignment. Consent to any one proposed assignment or sublease
shall not be deemed consent to further proposed assignments or
subleases. A corporate or partnership transaction involving
Tenant or the General Partner, including without limitation a
merger or sale or other transfer of the stock or partnership
interests in Tenant or the General Partner, which results in a
change of control of the Tenant or the General Partner, shall
constitute an assignment requiring Landlord's prior written
consent, unless the transaction involves the assignment of this
Lease to the Guarantor or to any corporation, partnership or
limited liability company controlling or controlled by the
Guarantor and meeting the Stated Criteria (as defined in Section
12(b)). The assignment or pledge of the assets of the Project as
collateral for financing purposes shall not be considered an
assignment pursuant to this Section 12 but shall be governed by
the provisions of Section 19. Landlord's consent shall not be
required in connection with the subletting or licensing of
portions of the Project for bar, restaurant, retail or
entertainment purposes which are incidental to the operation of
the Casino and which do not reduce the floor space dedicated to
Casino gaming under Section 9; provided that no such subletting
or licensing shall operate to relieve Tenant of any liability
under this Lease.
(b) PROCEDURES FOR ASSIGNMENT AND SUBLETTING. In the
event Tenant desires to assign its interest in this Lease or to
sublet the use of all or any portion of the Project, Tenant shall
deliver notice of the proposed transaction to Landlord, together
with detailed information regarding the financial condition and
operating history of the proposed assignee or subtenant
(including any operator) and the terms of the proposed assignment
or subletting. Within 30 days after receipt of the foregoing
information, and subject to the provisions of subsection (a) of
this Section 12, Landlord shall accept or reject Tenant's
proposal. Landlord's rejection shall be based upon (i) the
failure of the proposed assignee or subtenant to meet any of the
"Stated Criteria" as hereinafter defined, or (ii) the occurrence
of an Event of Default, and Landlord shall specifically state the
grounds for Landlord's rejection. If Landlord shall fail to
respond to Tenant within 30 days after receipt of Tenant's
proposal, Landlord shall be deemed to have accepted such
proposal. In the event Tenant shall object to Landlord's
rejection of Tenant's proposal, Tenant's sole remedy shall be to
commence arbitration proceedings in accordance with the
provisions of Section 31. The arbitrators shall either approve
or disapprove the proposed assignment or sublease based on
compliance with the Stated Criteria and shall make no other award
or determination. Tenant hereby indemnifies and holds Landlord
harmless from and against any loss, cost, damage, claim, demand
or expense (including attorneys' fees and expenses) incurred by
Landlord in connection with any action brought by or for the
benefit of the proposed assignee or subtenant or seeking relief
other than arbitration as provided herein. In the event an
assignment is approved by Landlord or through arbitration, the
assignee shall be subject to all of the provisions of this Lease.
(c) STATED CRITERIA. With respect to any assignee or
subtenant (or the general partner, if the assignee or subtenant
is a partnership), the following shall constitute the Stated
Criteria for approving any proposed assignee of Tenant's interest
in this Lease or any proposed subtenant or operator of the
Project:
(i) a net worth at least equal to that of
the Guarantor (whether or not the
Guarantees remain in effect);
(ii) a sufficient casino gaming operating
history or reputation in the industry
or community in the reasonable
judgment of Landlord; and
(iii) a gaming license to operate the
Project.
Tenant agrees that Landlord shall not be deemed unreasonable in
rejecting a proposed assignee or subtenant on any of the above-
stated grounds.
(d) CONSIDERATION AND EXPENSES. In connection with
any assignment of this Lease or any sublease or licensing
involving Casino operations (as opposed to ancillary uses of the
Project), and whether or not Landlord's consent is required,
Tenant shall pay to Landlord in cash 25% of the "Gain" realized
by Tenant (whether or not the Gain is deferred) from such
assignment, sublease or license, determined in accordance with
the requirements of the U.S. Internal Revenue Code. In the event
no Gain is realized, Tenant shall nonetheless pay to Landlord, as
and when received by Tenant, 25% of the total value of all
consideration realized by Tenant for or incident to any
assignment, sublease or license involving Casino operations in
excess of the Annual Rent payable under this Lease, after
deducting Tenant's reasonable attorneys' fees and real estate
commissions incurred to effect such assignment, sublease or
license. Prior to the effective date of any assignment, sublease
or licensing involving Casino operations, Tenant shall provide
Landlord with a statement of a nationally recognized accounting
firm certifying the Gain, if any, to be reported by Tenant in
connection with such assignment, sublease or licensing. Tenant
shall pay all reasonable attorneys' fees and expenses of Landlord
in connection with the review and approval of any such request
and of the documentation implementing same upon approval by
Landlord.
13. REPORTING COVENANTS. Tenant shall report each
month in writing to Landlord the progress of the Gaming Licensure
and Permit application process, the progress of construction, and,
after Project Opening, on a quarterly basis, AGR realized by
Tenant. Tenant also shall provide Landlord with such other
information regarding the development and operation of the
Project as Landlord may reasonably request, including the status
of Tenant's obligations under the Lease. All reports of AGR
shall be certified as to accuracy and completeness by an officer
of Tenant. In addition, copies of annual audit statements shall
be provided to Landlord by Tenant, and Landlord shall have the
right, at Landlord's sole cost and expense, except as hereinafter
provided, to conduct an audit of the books and records of Tenant,
not more frequently than once during any Lease Year, in order to
verify the accuracy of AGR reported by Tenant and Tenant's
compliance with the various operating and reporting covenants
contained in this Lease. Tenant shall maintain Tenant's books
and records in support of Tenant's computations and reporting of
AGR in accordance with generally accepted principles of
accounting consistently applied. Tenant's books and records
shall be retained in the St. Louis metropolitan area, available
for inspection and audit by Landlord during regular business
hours on reasonable prior notice to Tenant and without material
interruption of Tenant's business. In the event Landlord's audit
or any audit conducted by the Commission discloses that AGR has
been under-reported such that Landlord is entitled to receive an
additional payment of Annual Rent, Tenant shall promptly make
payment to Landlord of the entire sum due Landlord. In the event
the amount due exceeds 5% of the amount paid by Tenant, Tenant
also shall pay Landlord's expenses in conducting such audit.
Upon Landlord's request, Tenant also shall provide Landlord with
a copy of each financial statement, report and filing issued by
or on its behalf and provided to any regulatory body, including,
without limitation, the Missouri Gaming Commission, the
Securities and Exchange Commission and other authorities,
agencies and commissions having jurisdiction over Tenant's
operations. Tenant shall promptly report to Landlord any notice
received by it from any governmental authority or in respect of
any proceedings at law or in equity to which Tenant is a party
alleging violation of any Governmental Requirements by Tenant,
and Tenant shall provide to Landlord such information as Landlord
may request in connection therewith. Upon Landlord's request,
Tenant shall present to Landlord on an annual basis the Coast
Guard certificate of inspection obtained for the Casino. Tenant
hereby irrevocably designates St. Louis County as the "home dock"
for the Project during the Term for all purposes under Section
313.822 of the Revised Missouri Statutes, and Tenant agrees to
confirm the status of the County as the "home dock" for the
Project as and when requested to do so by Landlord or the
Commission.
14. INSURANCE.
(a) TYPES OF INSURANCE. Throughout the Term, Tenant
shall maintain in full force and effect the following insurance
coverage:
(i) commercial liability insurance on an
"occurrence basis" against claims for "personal injury"
including, without limitation, bodily injury, death or
property damage occurring on, in or about the Project
or in connection with any other operations of Tenant
related to the Project (such as, by way of example, off-
site bus or shuttle service), such insurance to afford
immediate minimum protection of $5 million combined
single limit/per occurrence and $10 million aggregate,
and, (a) with respect to the Project exclusive of any
boat hull, a deductible not greater than $75,000, and,
(b) with respect to any boat hull, a deductible not
greater than 1% of the value of the boat;
(ii) property insurance against loss or
damage to the Project (including the Casino) by fire
and other risks covered by insurance of the type now
known as "fire and extended coverage" in an amount
equal to the replacement value of the Casino and
remainder of the Project and with a deductible not
greater than $75,000 from the loss payable for any
casualty;
(iii) protection and indemnity insurance
including collision liability covering collisions with
all fixed or floating objects with a minimum limit of
$5 million per occurrence and a deductible not greater
than $75,000;
(iv) worker's compensation insurance in
full compliance with all applicable state and federal
laws and regulations, including a specific endorsement
covering liability for Federal Longshoremen's and
Harbor Workers' Compensation Act;
(v) employers liability insurance in the
minimum amounts of $1 million per individual claim, not
to exceed $100 million in the aggregate, covering
injury or death to any employee which may be outside of
or in addition to liability under any worker's
compensation statutory coverage;
(vi) excess or umbrella insurance
providing a minimum of $10 million in excess of
underlying limits and coverage provided by commercial
general liability, protection and indemnity and
employer's liability policies; and
(vii) personal property insurance
covering Tenant's trade fixtures, equipment, goods and
inventory in an amount not less than 95% replacement
value.
(b) QUALITY OF COVERAGE. All such policies shall be
issued by insurance companies licensed to do business in the
State of Missouri and approved by Landlord as to form and as to
surety and reserving the right of recovery by the Landlord in the
event of damage to its property and issued in the name of Tenant
and naming Landlord as additional insured, as its interest may
appear. Included in the property and maritime policies shall be
coverage providing for the removal of any Casino when damaged or
sunk from any cause whatsoever and this clause shall be expressed
as a specific warranty by the insurance company regardless of
cause. In addition, one or more of the policies shall include
special dram shop, vehicular and maritime operations
endorsements and a contractual liability endorsement covering the
indemnification agreements of Tenant contained in this Lease.
Policy certificates shall be delivered to Landlord on the
Effective Date and shall state that the coverage afforded thereby
shall not be modified or canceled without 60 days' prior written
notice to Landlord, delivered by registered mail. Provided no
Event of Default has occurred and is continuing, all loss
proceeds shall be made available to Tenant to restore and repair
the Project (including the Casino) as provided in Section 15.
Permitted deductibles may be increased by an amount equal to any
increased inflation in the value of U. S. currency.
(c) RENEWAL OF COVERAGE. Certificates of insurance
with reasonably satisfactory evidence of payment of the premium
thereof, shall be delivered to Landlord on or before the
Commencement Date or date of Project Opening, as appropriate, and
upon renewals of such policies, not less than 30 days after
renewal. Not less than 60 days prior to the expiration of any
such coverage, Tenant will provide evidence to Landlord of
continuing insurability by means of letters from qualified
carriers confirming intent to renew or provide the required
coverage. If Tenant at any time fails or refuses to procure or
maintain the required amount of insurance, then the Landlord may,
and without notice to Tenant, obtain same for and on behalf of
Tenant and charge the cost thereof to Tenant, such charge to be
due and payable upon demand and to constitute Additional Rent
hereunder.
(d) WAIVER OF SUBROGATION AND RIGHT OF RECOVERY.
Tenant, and all parties claiming under or through Tenant, hereby
expressly release and discharge Landlord and the County from any
claim or liability, whether based on negligence or any reason
whatsoever, for any personal injury or property damage. All
insurance policies of Tenant shall contain an endorsement
containing an express waiver of any right of subrogation by the
insurance company against Landlord and the County.
(e) ADDITIONAL INSURANCE. Tenant shall obtain such
other insurance in such amounts as may from time to time be
reasonably required by the Landlord against other insurable
hazards, and the Landlord may require the amount of any policy of
insurance Tenant is required to maintain pursuant to the
provisions of this Lease to be increased. Tenant shall not carry
separate or additional insurance concurrent in form or
contributing in the event of any loss or damage with any
insurance required to be obtained by Tenant under this Lease, if
the effect of such insurance would be to reduce the protection or
payment to be made under insurance required hereunder. In the
event Tenant objects to any increased or additional coverage
required by Landlord, the issue shall be submitted to binding
arbitration in accordance with the provisions of Section 31
hereof.
15. DAMAGE AND DESTRUCTION.
(a) CASUALTY TERMINATION. If, at any time during
the last 10 years of the Term, the Project is damaged by any
cause or casualty in an amount exceeding 15% of the then
replacement cost of the Project, Tenant shall have the right to
terminate this Lease by written notice to Landlord within 60 days
of the happening of the casualty causing such damage or
destruction. In such event, Landlord shall receive from the
insurance proceeds the lesser of (a) the then present value of
the Minimum Rent payable to Landlord for the remainder of the
Term plus the amount equal to the cost of rebuilding all damaged
or destroyed land-based facilities, or (b) 100% of the insurance
proceeds. Any funds remaining following the distribution of the
insurance proceeds paid to Landlord pursuant to the previous
sentence shall be paid to Tenant. Upon any termination of the
Lease under this provision, Tenant shall surrender possession of
the Premises within 90 days after notice of termination,
whereupon each of the parties shall be released thereby from any
further obligations to the other except for items which have
theretofore accrued and are then unpaid, and such termination
shall be deemed to relate back to the date of damage or
destruction; provided, however, that if the Project or any part
thereof shall be kept open for business after the date of damage
and prior to the surrender of possession of the Premises, the
termination date shall be the date upon which Tenant shall
discontinue the conduct of its business on the Premises. In the
event of any termination pursuant to this Section 15(a), and upon
surrender of the Premises to Landlord, Landlord shall refund to
Tenant any unearned portion of Annual Rent prepaid by Tenant. In
addition, in the event Landlord relets the Premises to another
lessee, Landlord shall reimburse Tenant for the prepaid Minimum
Rent paid by Tenant due to the termination of this Lease pursuant
to this Section 15(a) from the rent paid by such lessee.
(b) CASUALTY RECONSTRUCTION. In the event of damage
or destruction occurring to the Project (including the Casino)
other than as described in subsection (a) above, Tenant shall
repair and rebuild the Project (including the Casino), and
restore the Project to full operation with reasonable diligence;
Tenant shall direct, control, coordinate and approve all such
repairs, reconstruction and restoration contemplated by this
provision and shall have the right to select any architects,
engineers and contractors for such repairs, reconstruction or
restoration. All loss proceeds shall be made available to
Tenant and shall be applied to effect such repair, reconstruction
or restoration of the Project. No component of Annual Rent or
Additional Rent shall ▇▇▇▇▇ as a result of any such damage or
destruction, it being understood and agreed that Tenant shall
maintain such business interruption insurance as Tenant may
require in order to assure Tenant of the ability to continue to
meet Tenant's financial obligations under this Lease.
16. CONDEMNATION.
(a) DEFINITIONS. Whenever used in this section, the
following words shall have the following respective definitions
and meanings: (i) "condemnation" or "condemnation proceedings" -
any action or proceeding brought by competent authority for the
purpose of the taking of the fee of the Premises, the Project or
any part thereof, as a result of the exercise of the power of
eminent domain, including a voluntary sale to such authority
either under threat of or in lieu of condemnation or while such
action or proceedings is pending; (ii) "taking" - the event of
vesting of title to the fee of the Premises, or the Project or
any part thereof, in the competent authority pursuant to
condemnation; (iii) "vesting date" - the date of the taking.
(b) DEFENSE OF TAKING. Landlord, immediately upon
obtaining knowledge of the institution of any proceedings for the
condemnation of the Premises or any part thereof, shall notify
Tenant of the pendency of such proceedings. Landlord shall then,
if requested by Tenant, file or defend its rights thereunder and
prosecute the same with due diligence to its final disposition.
Tenant may, but shall not be required to, participate in any such
proceedings and Landlord from time to time will deliver to Tenant
all instruments requested by it to permit such participation. In
the event Tenant chooses to participate in any such proceedings,
Landlord may be the nominal party in such proceedings, but Tenant
shall be entitled to control and direct the same and to be
represented therein by counsel of its choice, at Tenant's cost.
Landlord covenants and agrees that it will use its best efforts
and take all actions necessary and appropriate to cause the
County not to exercise its powers of eminent domain with regard
to the Premises, the Project or any part thereof, and otherwise
to assure to the greatest extent possible that neither the
Premises, the Project nor any part thereof, shall be condemned
during the Term.
(c) TOTAL TAKING. In the case of a taking of all of
the Premises and the Project, this Lease shall terminate as of
the vesting date and the Rent under this Lease shall be
apportioned to the date of termination, and upon surrender of the
Premises to Landlord, Landlord shall refund to Tenant any
unearned portion of Annual Rent prepaid by Tenant.
(d) PARTIAL TAKING - TERMINATION OR ARBITRATION.
In the case of a taking of less than all of the Premises and Project
(other than for a temporary use) Landlord and Tenant mutually
shall determine within a reasonable time after the vesting date
whether the remainder thereof can economically and feasibly be
used by Tenant. If Landlord and Tenant cannot mutually agree
upon such matter with 90 days after the vesting date, it shall be
determined by binding arbitration pursuant to the provisions of
Section 31. If it is determined by mutual agreement or by
arbitration that the remaining Premises and Project cannot
economically and feasibly be used by Tenant, Tenant may terminate
this Lease on not less than 10 days nor more than 30 days notice
to Landlord to such effect, provided that such notice is given
within 30 days after such determination, and the Rent shall be
apportioned to the date of termination. If Tenant does not elect
to terminate this Lease within the period aforementioned, it
shall continue in full force and effect with respect to the
remaining portion of the Premises. If this Lease shall terminate
pursuant to this provision, the award for the Project shall be
apportioned and paid, to the extent available, in the following
order of priority: (i) Landlord and Tenant first shall be
entitled to their reasonable expenses and charges including,
without limitation, reasonable attorneys' fees incurred in
connection with the taking; (ii) Landlord shall be entitled to
the value of the fee exclusive of the value of this Lease; and
(iii) Tenant shall be entitled to the balance of the award. If
the court in which the condemnation proceedings are brought fails
or refuses to apportion its award between Landlord and Tenant,
and if Landlord and Tenant cannot agree upon the allocation
defined in the above order of priority, such values, allocation
and apportionment shall be determined by binding arbitration
under the provisions of this Lease. The provisions of this
section also shall apply in the case of a partial taking where
the this Lease is terminated pursuant to the provisions hereof.
(e) PARTIAL TAKING - RECONSTRUCTION. In the case of a
partial taking where the Tenant does not elect to terminate this
Lease pursuant to the provisions set forth above, Tenant shall
commence and proceed with reasonable diligence to repair and
reconstruct the remaining improvements to a complete,
economically usable, architectural unit or units, including,
without limitation, temporary repairs, changes and installations
required to accommodate space subtenants and all other work and
replacements and additions of furniture and furnishings
incidental to and appropriate in connection with all of the
foregoing (all such repair, reconstruction, replacements and
additions and work being referred to in this section as
"restoration"); and the total award of the condemnation
proceedings, including the award for the Project shall be
apportioned and paid to the extent available in the following
order of priority: (i) Landlord and Tenant first shall be
entitled to their reasonable expenses and charges including,
without limitation, reasonable attorneys' fees incurred in
connection with the taking; (ii) Tenant shall be entitled to an
amount equal to the cost of restoration to the extent
contemplated by this section, such sums shall be turned over to
Tenant to be held in trust for the purpose of paying for the cost
of restoration; (iii) Landlord shall be entitled to the value of
the fee exclusive of the value of this Lease; (iv) Tenant next
shall be entitled to the value of its leasehold estate under this
Lease, the value of the Project, the value of the furniture,
fixtures and equipment of the Project and the balance of the
award.
(f) TEMPORARY TAKING. In the event of a taking of all
or any portion of the Premises and the Project for temporary use,
the foregoing provisions of this Section 16 shall be inapplicable
thereto. This Lease shall remain in full force and effect and
Tenant alone shall be entitled to make claim for, recover and
retain any award recoverable in respect of such temporary use, so
long as Rent is first paid from such award. If any portion of
the award for such temporary use is intended to cover the cost of
restoring the Premises and the Project to the condition they were
in prior to such temporary use, such portion of the award shall
be paid to Tenant to cover the cost of such restoration and
repair.
17. ADJACENT PARCEL.
(a) DEVELOPMENT PARAMETERS. Tenant and its affiliates
shall be permitted to submit proposals to Landlord for the
development of all or portions of the Adjacent Parcel. The
Adjacent Parcel may be developed by Landlord and/or other parties
for light industrial, commercial, retail, entertainment and/or
recreational uses. Structures of any size or height, such as
warehouses, distribution centers, manufacturing facilities,
hotels, shopping centers, entertainment, sporting or recreational
facilities, parking lots or garages, communications towers, and
docking facilities, may be constructed and operated on the
Adjacent Parcel. Landlord covenants that no use may be made of
the Adjacent Parcel which shall constitute a nuisance or
hindrance to the Project, detract materially from the aesthetic
appeal of the Project, generate excessive industrial noise or
noxious industrial or chemical odors, or materially impair access
to the Project. Neither the volume nor type of traffic,
including heavy truck traffic, on the Adjacent Parcel, including
any resulting noise or omissions, nor any signage or illumination
located on the Adjacent Parcel, shall be deemed to constitute a
nuisance, impairment or detraction. That portion of the Adjacent
Parcel which is within the 50' by 550' zone along the northern
perimeter boundary of the Premises identified on ATTACHMENT D
shall constitute a "Buffer Zone" between any development located
on the Adjacent Parcel and the Premises. Only green space or
landscaping shall be located within the Buffer Zone. Tenant
shall have a non-exclusive license, at Tenant's sole risk, cost
and expense, at Tenant's option, but without obligation, to enter
upon the Buffer Zone for the sole purpose of performing,
maintaining, repairing and replacing landscaping on the Buffer
Zone should Tenant so desire. Notwithstanding the foregoing
provisions of this Section 17(a), the parties acknowledge and
agree that a reconfiguration of the roadway providing access to
the Premises and/or the Adjacent Parcel, if and as agreed to by
the parties in connection with a resolution of pertinent Access
Issues, may entail access to the Adjacent Parcel via the bridge
to be constructed by Tenant or via the circular roadway depicted
on ATTACHMENT D.
(b) ENFORCEMENT. A restrictive covenant consistent
with the requirements of Section 17(a) shall be recorded by
Landlord against the Adjacent Parcel, and such restrictive
covenant shall be prior and paramount to any mortgage, deed of
trust or other encumbrance against the Adjacent Parcel. Landlord
shall have the right but not the obligation to enforce compliance
with such covenant to the extent the real estate in question has
been sold or transferred to a third party, but Tenant, its
successors and assigns, shall be designated in the covenant as
intended beneficiaries thereof with full right to institute
action, legal and equitable, for any violation thereof. To the
extent Landlord retains ownership of the real estate in question
and the violation complained of is committed by a tenant or
occupant of the real estate, Landlord shall use its best efforts
to enforce Landlord's rights under the covenant by appropriate
legal action, including seeking appellate relief, if necessary.
(c) EXISTING LEASE. In the event of a conflict
between any provision of this Section 17 and any existing
provision of that certain Lease between Landlord, as successor to
NL Industries, Inc., and The ▇▇▇▇▇▇ Company, as Tenant, dated as
of June 2, 1987, the provisions of the latter such lease shall
control. In the event the operations of the ▇▇▇▇▇▇ Company, its
successors, assigns or subtenants, on or from the ▇▇▇▇▇▇ Company
premises, are interfering with, or will likely interfere with,
Tenant's development or operation of the Project, in the
reasonable judgment of Tenant, after written notice to Landlord,
and provided other measures taken by Landlord and the ▇▇▇▇▇▇
Company to obviate the interference or potential interference are
either unavailable or prove insufficient, Landlord agrees to
cancel the ▇▇▇▇▇▇ Company lease at the earliest permissible date.
18. NON-DISTURBANCE AND ATTORNMENT.
Landlord shall have the right to obtain a mortgage secured by Landlord's
interest in the Premises and/or this Lease; provided, however, that this
Lease, including all of the rights of Tenant under or pursuant to
this Lease, shall be paramount to, and shall not be subject or
subordinate to, any mortgage, deed of trust or other security
interest instrument ("Mortgage") that may now or hereafter affect
Tenant's interest in the Premises. Any Mortgage shall contain,
as required terms, the express acknowledgment that Tenant shall
not be liable for the payment of the sum secured by such
Mortgage, nor for any expenses in connection with the same.
Neither such Mortgage nor any instrument collateral thereto shall
contain any covenant or other obligation on Tenant's part to pay
such debt, or any part thereof, or to take any affirmative action
of any kind whatsoever; provided, however, that Tenant shall
remain liable under this Lease notwithstanding any foreclosure of
Landlord's interest in the Premises or any transfer of title to
the Premises, and provided further that Tenant shall agree to
attorn to such transferee. Such Mortgage shall expressly provide
that the Mortgagee shall not seek any money judgment against
Tenant related to any Mortgage obligation of Landlord. Each
Mortgagee shall agree to a non-disturbance and attornment
agreement which will require the Mortgagee to recognize that this
Lease is superior to Mortgagee's Mortgage, (ii) that Tenant shall
be entitled to use and occupy the Premises and the Project in
accordance with the terms of this Lease, (iii)
that Tenant shall be entitled to all of its rights under this Lease,
(iv) that insurance and condemnation awards and proceeds shall be
disbursed as provided in this Lease, and (v) Tenant's possession of
the Premises and the Project shall not be disturbed by Mortgagee
or by any person whose rights are acquired through foreclosure
proceedings or through a deed in lieu of foreclosure except as
may be expressly provided in this Lease, and any subsequent
transferee of such rights shall be so bound provided no Event of
Default occurs and is continuing under this Lease. The non-
disturbance and attornment agreement may require (x) that as a
condition to the making of any amendment or modification to this
Lease Landlord receive the prior written consent of such
Mortgagee, (y) that such Mortgagee shall receive notice of any
default claimed by or through Tenant against Landlord, and (z)
that such Mortgagee shall have the same right to cure such
default as is provided the holder of any Leasehold Mortgage
obtained by Tenant. Tenant shall within 10 days after receipt
from Landlord execute and deliver to Landlord and Landlord's
Mortgagee such estoppels and attornment agreements as may be
required in connection with any proposed financing or refinancing
involving the Premises and/or the Adjacent Parcel, provided the
terms and conditions of such estoppels or attornment agreements
are consistent with the provisions of this Section 18 and the
same do not constitute a modification of this Lease.
19. LEASEHOLD MORTGAGES.
(a) RIGHT TO LEASEHOLD MORTGAGE. Tenant shall have
the right to mortgage and to refinance this Lease and Tenant's
leasehold estate and any improvements thereon, including but not
limited to the Project, ("Leasehold Mortgage") at any time, and
from time to time, on any terms Tenant may deem desirable and to
assign this Lease and any existing and future subleases, license
agreements and concession agreements, and the rentals and fees
payable to Tenant thereunder to the holder of such mortgage
("Leasehold Mortgagee"), as additional collateral security for
the indebtedness secured by the Leasehold Mortgage. In
connection therewith, Landlord agrees to timely execute and
deliver an estoppel certificate, a non-disturbance agreement, and
such other documents in reasonably satisfactory form as shall be
requested by any Leasehold Mortgagee, so long as such
certificates, agreements or other documents are not inconsistent
with this Lease. Any Leasehold Mortgage shall be subject and
subordinate to Landlord's rights under this Lease and its fee
interest in the Premises, except as otherwise provided herein.
(b) TERMS OF LEASEHOLD MORTGAGE. If Tenant shall have
executed and delivered a Leasehold Mortgage or Mortgages and the
Leasehold Mortgagee shall have notified Landlord in writing to
such effect giving its name and address:
(i) Landlord concurrently shall serve upon such
Leasehold Mortgagee a copy of each notice, consent, approval,
request or demand given to Tenant under this Lease including,
without limitation, any notice, consent, approval, request or
demand under this Lease. No such notice to Tenant shall be
deemed to have been given nor shall be effective unless copies
thereof are thus served upon the Leasehold Mortgagee at such
address and in the manner provided pursuant to the Notice
provisions hereof.
(ii) Subject to the provisions set forth below,
such Leasehold Mortgagee shall have the right, for a period of 30
days more than is given to Tenant, to remedy or cause to be
remedied any default which is the basis of a notice; and Landlord
shall accept performance by such Leasehold Mortgagee as
performance by Tenant. In the event that Tenant has contested an
event of default, such Leasehold Mortgagee shall be given a 20
day period after the date of a final decision affirming the
contested default within which to cure such default on behalf of
Tenant.
(iii) In the case of default by Tenant under this
Lease which is susceptible of being cured only when such
Leasehold Mortgagee has obtained possession of the Premises and
the Project, other than a default in the payment of Rent or
Additional Rent, Landlord shall take no action to effect a
termination of this Lease by service of a notice or otherwise
without first giving to such Leasehold Mortgagee a reasonable
period of time (not to exceed 6 months) within which diligently
to obtain possession of the Premises and the Project (including
possession by a receiver) and to cure such default and/or
diligently to institute and complete foreclosure proceedings or
otherwise acquire Tenant's leasehold estate under this Lease and
to cure such defaults.
(iv) Upon acquisition of Tenant's interest in
this Lease by the Leasehold Mortgagee, or by any purchaser of
this Lease pursuant to any foreclosure proceeding instituted by
the Leasehold Mortgagee, Landlord's right to serve a notice of
election to end the Term based upon the occurrence of any default
(other than non-payment of Rent or Additional Rent, or non-
compliance with the provisions of Sections 9, 10, 12, 14, 15 or
20) which cannot with the exercise of due diligence be remedied
by such Leasehold Mortgagee or purchaser shall be deemed waived.
(v) If, prior to any foreclosure sale brought by
a Leasehold Mortgagee, or if prior to the date upon which
Tenant's interest in this Lease shall have been otherwise
acquired by Leasehold Mortgagee or other purchaser, the default
in respect of which Landlord shall have given the notice shall
have been remedied and possession of the Premises and the Project
restored to Tenant, the obligation of the Leasehold Mortgagee to
assume this Lease shall be null and void and of no further
effect.
(vi) Notwithstanding anything contained in this
Section 19 to the contrary, if for any reason this Lease shall
terminate prior to the expiration of the Term, Landlord shall
give written notice thereof to the Leasehold Mortgagee. Subject
to the curing of any Event of Default and the payment of all Rent
and Additional Rent owed Landlord by the Tenant, and provided
such cure occurs not later than 60 days after Landlord's
termination of this Lease, Landlord shall enter into a new lease
for the Premises and the Project with the Leasehold Mortgagee or
with any person, firm, corporation or entity designated by the
Leasehold Mortgagee for the remainder of the Term, subject to
approval by Landlord, which approval shall not be unreasonably
withheld or delayed as provided in clause (vii) below, commencing
as of the date of such termination, at the Rent and upon the same
terms, covenants and conditions contained in this Lease (except
those which by their terms are no longer applicable). Such new
lease shall have priority equal to this Lease. Concurrently with
the execution and delivery of such new lease, Landlord shall turn
over and/or assign to the new tenant all of its right, title and
interest in and to moneys (including insurance proceeds) if any,
then held by or subsequently paid to Landlord, which Tenant would
have been entitled to receive but for such termination.
(vii) Landlord shall have no obligation (i) to
waive Landlord's lien rights (it being understood and agreed that
Landlord shall be required only to subordinate such lien rights
to the security interests of the Leasehold Mortgagee) or (ii) to
agree to any modification of any express term, covenant or
provision of this Lease, including, without limitation, the
disposition of the proceeds of a condemnation or casualty
contrary to the provisions of this Lease. Landlord's refusal to
accept any proffered successor tenant or operator of the Project
shall be deemed reasonable to the extent such party fails to meet
any of the Stated Criteria. Tenant shall require any Mortgagee
to provide Landlord with notice of any default under the terms of
any loan agreements, mortgages or promissory notes entered or
provided to the Mortgagee. In no event shall Landlord be
required to forbear in the exercise of any remedies available to
Landlord against the Guarantor upon the occurrence of an Event of
Default by Tenant. In the event Landlord shall refuse to
approve a successor to Tenant proffered by the Leasehold
Mortgagee, the sole remedy available to the Leasehold Mortgagee
shall be to commence arbitration proceedings in accordance with
the provisions of Section 31. The arbitrators shall either
approve or disapprove the proposed successor based on compliance
with the Stated Criteria and shall make no other award or
determination.
20. INDEMNIFICATION.
(a) INDEMNITY GENERALLY. Tenant shall defend, pay,
indemnify and hold harmless Landlord and its agents, employees,
servants and representatives (together, the "Indemnified
Parties") from and against any and all claims, demands, injuries,
damages, fines, penalties, lawsuits, actions, proceedings,
orders, decrees, judgments or liability of any kind or nature by
or in favor of anyone whomsoever and from and against any and all
costs and expenses incurred by any of the Indemnified Parties,
including reasonable attorneys' fees and expenses, resulting or
arising from or in connection with (i) any accident, bodily
injury, death, personal injury of any kind, or property damage
arising directly or indirectly, out of or from or on account of
any occurrence in, upon, at, or about the Project; (ii) any
accident, bodily injury, death, personal injury or property
damage arising, directly or indirectly, out of or in connection
with Tenant's operation of gaming activities or the Casino; (iii)
any use, occupancy, non-use, or condition of the Project; and
(iv) any failure on the part of the Tenant to perform or comply
with any of the terms, covenants and conditions of this Lease.
(b) DEFENSE. In case any action, suit or proceeding
is brought against any of the Indemnified Parties by reason of
any occurrence described in clauses (i) through (iv), Tenant or
Tenant's insurer, upon the request of Landlord, will, at no
expense to Landlord or the Indemnified Party, resist and defend
such action, suit or proceeding or cause same to be resisted and
defended by counsel reasonably acceptable to Landlord. The
Indemnified Party shall have the right, at its discretion, to
retain its own counsel and be reimbursed by Tenant for all
reasonable attorneys' fees and costs incurred in the defense of
any action. The obligations of Tenant under this Section shall
survive the termination of this Lease.
(c) ENVIRONMENTAL INDEMNITY AND RELEASE.
In addition to the foregoing, Tenant agrees to indemnify and hold
harmless the Indemnified Parties and to defend them against any
lawsuitsor claims for any liability, injuries, damages, penalties or
fines (including reasonable attorneys' fees and expenses) arising
from or relating to the disposal, discharge, release or spilling
into or onto the air, water, soil, sewer system or similar media
of any Hazardous Substance which disposal, discharge, release or
spill, whether accidental or intentional, occurs on, within or
from the Project (including the Casino, wherever located) during
the Term. Tenant agrees that Landlord shall have no liability or
obligation of any kind to Tenant on account of any Hazardous
Substances released on or from the Premises and covenants not to
bring any action, claim or demand against Landlord on account
thereof; provided, however, that such covenant to not ▇▇▇
Landlord shall not apply to any release or migration of any
Hazardous Substance onto the Premises from the Adjacent Parcel
which is caused by Landlord or any tenant or occupant of the
Adjacent Parcel, their respective employees, contractors or
agents, and which first occurs during any period of Landlord's
ownership after the Effective Date.
(d) SURVIVAL OF INDEMNITY. The provisions of this
Section 20 shall survive any termination of this Lease.
21. RIGHT OF ENTRY. Landlord and its authorized agents and
employees shall, upon reasonable notice and during all reasonable
business hours, have the right to enter upon the Project to
examine same; provided, however, that any such entry shall not
interfere with Tenant's use or the operation of the Project, and
provided further that Tenant shall have the right to have a
representative or employee of Tenant accompany any such
inspection by Landlord. Landlord shall have the right from time
to time to inspect the Premises and to conduct tests and
evaluations to confirm whether Hazardous Substances have been
released on or from the Project in violation of applicable
Governmental Requirements. Such tests shall be conducted at
Landlord's sole risk, cost and expense, except that if it is
determined that Tenant shall have violated the provisions of
Section 20 relating to the release of Hazardous Substances, then
Tenant shall, in addition to performing such remediation as may
be required, pay to Landlord all costs incurred by Landlord in
connection with such tests and evaluations, and such additional
tests and evaluations as Landlord may conduct to confirm
satisfactory completion of Tenant's remediation work.
22. LIMITATION OF CLAIMS. Landlord shall not be
responsible for any damage or loss to the Casino or the Project,
its furnishings, fixtures, equipment or other goods thereon due
to any cause whatsoever, including, but not limited to, theft,
vandalism, public disorder, fire, weather, collisions, floating
or underwater hazards, electrolysis, tie-up or boat defects.
Additionally, Landlord shall not be responsible for any damage or
injury to Tenant's patrons, wherever located, arising from any
source, and Tenant shall perform all acts necessary to provide
for the safety of its patrons while on the Premises or in the
Casino. Upon any sale of the Premises by Landlord, Landlord
shall be released from all obligations and liabilities accruing
under this Lease prior to the effective date of such sale,
provided the transferee shall expressly assume and agree to
perform for the benefit of Tenant all obligations of Landlord
under this Lease accruing after the effective date of such
transfer.
23. ATTORNEYS' FEES AND EXPENSES. Except as otherwise
expressly provided in this Lease, each party shall pay its own
attorneys' fees and expenses in connection with any matter
arising under this Lease.
24. LATE PAYMENTS. Late payments shall be subject to a
3% penalty and interest on late payments shall accrue from the date
of delinquency until paid at the rate of 2% in excess of the from
time to time publicly announced prime rate of interest of The
Boatmen's National Bank of St. Louis.
25. DEFAULT AND REMEDIES.
(a) TENANT'S DEFAULT. It shall be an Event of Default
if any one or more of the events described in the following
clauses (i) through (ix) shall occur and be continuing after
expiration of the applicable notice and cure period provided for
in such clause or otherwise provided for in subsection (b):
(i) if default be made in the punctual payment of
any Rent payable to Landlord hereunder, when
and as the same shall become due and payable,
and such default shall continue for a period
of ten (10) days after written notice to
Tenant (except that Landlord shall not be
required to deliver notice of non-payment of
Rent on more than two occasions during any
Lease Year), or if default be made in the
punctual payment of any Additional Rent
payable hereunder, when and as the same shall
become due and payable, and such default
shall continue for a period of thirty (30)
days after written notice to Tenant;
(ii) if this Lease be mortgaged byTenant except
as provided in Section 19, or if this Lease
be assigned or the Project (including the
Casino) or any part thereof be sublet, except
as provided in Section 12;
(iii) if Tenant shall abandon the Work or the
Project, or if Tenant shall fail to
continuously or fully operate the Project
after Project Opening as required under
Section 11;
(iv) if Tenant shall fail to timelyfile its
application for Gaming Licensure, or if
Tenant shall withdraw or effectively abandon
such application prior to termination of this
Lease in accordance with its terms or, after
first obtaining Gaming Licensure, if Tenant
for any reason ceases to be licensed to
conduct a gaming operation at the Project
pursuant to the laws of the state of
Missouri;
(v) if Tenant shall fail to observe, perform or
comply with any of the terms, covenants and
conditions in this Lease other than those
specified in subsections (i) through (iv)
above, within 30 days after notice from
Landlord specifying the nature of such
default;
(vi) if Tenant or the Guarantor shall file a
voluntary petition in bankruptcy or shall be
adjudicated bankrupt or insolvent or shall
file any petition or answer seeking any
reorganization, readjustment, liquidation,
dissolution or similar relief under any
bankruptcy or insolvency statute or law of
the United States or any State, or shall seek
or consent to or acquiesce in the appointment
of any bankruptcy or insolvency trustee,
receiver or liquidator of tenant, the
Guarantor or of all or any substantial part
of its properties or the Project;
(vii) if within 60 days after the commencement of
any involuntary proceeding against Tenant or
the Guarantor seeking reorganization,
readjustment, liquidation, dissolution or
similar relief under any bankruptcy or
insolvency statute or law, Tenant or the
Guarantor fails to secure a dismissal and
discharge thereof;
(viii) if Guarantor shall be in default under either
of the Guarantees, and such default shall
remain uncured beyond the period provided for
the cure thereof, if any;
(ix) if Tenant or the Guarantor shall make a
material misrepresentation in any
representation or warranty provided to
Landlord under this Lease or in any report
provided to Landlord pursuant to Section 13
(b) CURE OR REMEDIES. No Event of Default shall be
deemed to have occurred under clauses (ii) through (ix) unless
Tenant or the Guarantor, as the case may be, shall fail to cure
such default within 30 days after delivery by Landlord of written
notice of such default to Tenant, unless the same cannot be cured
within 30 days, in which event an Event of Default shall not be
deemed to have occurred if Tenant commences the cure of such
default within 30 days and thereafter diligently pursues such
cure to completion. Upon an Event of Default, Landlord, at its
option, may at any time thereafter declare this Lease and all
rights of Tenant under this Lease as expired and terminated and
Tenant shall remain liable as hereinafter provided.
(c) SURRENDER OF PREMISES. Upon any such expiration
or termination of this Lease, Tenant shall quit and peacefully
surrender the Project to Landlord, and Landlord, upon any such
expiration or termination, may without further notice enter upon
and re-enter the Project and possess and repossess itself
thereof, by force, summary proceedings, ejectment or otherwise,
and may dispossess Tenant and remove Tenant and all persons and
property from the Project.
(d) RELETTING OF PREMISES. If this Lease shall expire
or be terminated, or if the Project or any part thereof shall be
abandoned by Tenant, or shall become vacant during the Term,
Landlord may in its own name, or as agent for Tenant if this
Lease not be terminated, enter into possession of and relet the
Project or any part thereof for such term or terms (which may be
greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions as
Landlord, in its discretion, may determine and may collect and
receive the rents therefor.
(e) DIRECT DAMAGES. No event of expiration or
termination of this Lease, abandonment or vacancy, shall relieve
Tenant of its liability and obligations under this Lease, whether
or not the Project shall be relet. In any such event Tenant
shall pay Landlord the Rent and all Additional Rent required to
be paid hereunder by Tenant up to the time of such event.
Thereafter:
(i) In the event of termination of the Lease,
Tenant, until the date which is the first to
occur of (a) the expiration of the Term or
(b) the expiration of the 15th Lease Year
subsequent to the date of termination, shall
be liable to Landlord as damages for Tenant's
default, the equivalent of the amount of the
Rent and Additional Rent which would be
payable under this Lease by Tenant if this
Lease were still in effect, less the net
proceeds of any reletting effected pursuant
to the provisions hereof, after deducting all
of Landlord's expenses in connection with
such reletting, including without limitation,
all repossession costs, brokerage and
management commissions, operating expenses,
legal expenses, reasonable attorneys' fees,
alterations costs, and expenses of
preparation of such reletting. The amount of
Additional Rent due in the event of
expiration or termination of this Lease shall
be equal to the Additional Rent paid to
Landlord in the year prior to the year of
termination divided into twelve equal monthly
installments. Tenant shall pay such damages
(herein called "deficiency") to the Landlord
on the days on which the net Rent would have
been payable under this Lease if this Lease
were still in effect, and the Landlord shall
be entitled to recover from Tenant each
deficiency as the same shall arise.
(ii) At any time after the expiration or
termination of this Lease, in lieu of
collecting any further deficiencies as
aforesaid, Landlord shall be entitled to
recover from Tenant, and Tenant shall pay to
Landlord, on demand, an amount equal to the
difference between the Rent which would have
accrued to Landlord under this Lease from the
date of termination to the date which is the
first to occur of (a) the expiration of the
Term or (b) the expiration of the 15th Lease
Year subsequent to the date of termination,
and the then fair and reasonable rental value
of the Premises for the same period as
provided in Section 25(f). Tenant shall
remain liable for any deficiencies not
previously recovered by Landlord.
(f) VALUE OF PREMISES. If the Premises or any part
thereof be relet by Landlord for the unexpired Term, or any part
thereof, the amount of rent reserved upon such reletting shall be
deemed the fair and reasonable rental value for the part or the
whole of the Premises so relet during the term of the reletting.
Landlord agrees to make reasonable efforts to mitigate its
damages by listing the Premises with a licensed real estate
broker for reletting on terms and conditions acceptable to
Landlord, but Landlord shall have no obligation to relet the
Premises to any particular tenant or for any particular use,
including, without limitation, casino gaming.
(g) ADDITIONAL DAMAGES. If this Lease be terminated,
or if the Project is abandoned or becomes vacant, and whether or
not the Project be relet, Landlord shall be entitled to recover
from Tenant, and Tenant shall pay to Landlord, in addition to any
damages becoming due under this Section 25, the following: an
amount equal to all expenses, if any, including reasonable
attorneys' fees, incurred by Landlord in recovering possession of
the Project (whether or not litigation be commenced in aid
thereof), repairing any damage to the Project, and all reasonable
costs and charges for the care of said Project while vacant,
which damages shall be due and payable by Tenant to Landlord at
such time or times as such expenses are incurred by Landlord.
Tenant hereby expressly waives, as far as permitted by law, the
service of any notice of intention to re-enter provided for in
any statute, and except as is herein otherwise provided Tenant,
for and on behalf of itself and all persons claiming through or
under Tenant (including any leasehold mortgagee or other
creditor), also waives any and all right of redemption or re-
entry or repossession in case Tenant shall be dispossessed by a
judgment or by warrant of any court or judge or in case of re-
entry or repossession by Landlord or in case of any expiration or
termination of this Lease except as expressly provided in this
Lease. The terms "enter," "re-enter," "entry" or "re-entry" as
used in this Lease are not restricted to their technical legal
meanings.
(h) WAIVER OF AUTOMATIC STAY. In view of the public
interest in the integrity of the gaming process and the
involvement of the County and Landlord in the Project, in the
event of any voluntary or involuntary petition in bankruptcy
involving Tenant or Guarantor, Tenant and Guarantor hereby waive,
to the fullest extent permitted by law, any right they may have
to object to the waiver of vacation of the automatic stay in all
respects as to the rights of Landlord under the Lease and the
Guarantees.
(i) WAIVER OF JURY TRIAL. Tenant hereby waives all
right to trial by jury in any action or proceeding hereafter
instituted by Landlord against Tenant with respect to this Lease
or the Project. Tenant agrees not to interpose any counterclaim
of any nature or description in any such action or proceeding
unless it is a compulsory counterclaim.
(j) ADDITIONAL REMEDIES. In the event of any breach
by Tenant of any of the agreements, terms, covenants or
conditions contained in this Lease, Landlord shall have the right
to invoke any right and remedy allowed at law or in equity
including the right to seek specific performance of Tenant's
obligations under this Lease and to enjoin violations of this
Lease by Tenant.
(k) LANDLORD'S DEFAULT. It shall be an event of
default on the part of Landlord (a "Landlord Default") if any one
or more of the events described in the following clauses (i)
through (iii) shall occur and be continuing after expiration of
the applicable notice and cure period provided for in such
clause:
(i) Landlord shall fail to make any payment which
Landlord agrees to make to or for the benefit
of Tenant pursuant to Section 2 or to
otherwise cure on a timely basis any
objection raised by Tenant under Section 2
which Landlord has theretofore agreed in
writing to cure, after 30 days prior written
notice to Landlord;
(ii) Landlord shall make a material
misrepresentation in any representation or
warranty provided to Tenant under Section
8(b) of this Lease, and such
misrepresentation shall materially and
adversely affect any right or benefit
available to Tenant under this Lease; or
(iii) Landlord shall breach any express covenant of
Landlord under this Lease and shall fail to
cure such breach within 30 days after notice
from Tenant specifying the nature of such
breach, unless the same cannot be cured
within 30 days, in which event Landlord shall
not be deemed in default provided Tenant
commences the cure of such default within 30
days and thereafter diligently pursues such
cure to completion.
If a Landlord Default shall occur, Tenant shall have the right to
pursue any remedy available to Tenant at law or in equity on
account of such Landlord Default; provided, however, in no event
shall Tenant be entitled to (i) withhold, deduct or offset Rent
or Additional Rent, (ii) vacate or abandon the Project or close
the Casino (except pursuant to any express right of vacation or
closure granted Tenant under this Lease), (iii) seek or recover
consequential damages (such as for lost profits) from Landlord,
(iv) seek or recover damages or equitable relief in violation of
the provisions of Sections 20(c) or Section 22, or (v) terminate
this Lease (except pursuant to any express right of termination
granted Tenant under this Lease). Tenant hereby waives and
releases each of the claims specified in clauses (i) through (v)
hereof. In all events, any recovery of monetary damages by
Tenant shall be limited solely to the interest of Landlord in the
Premises, which shall include the Rentals and avails thereof.
26. REMEDIES CUMULATIVE. Each right and remedy provided
for in this Lease shall be cumulative and shall be in addition to
every other right or remedy provided for in this Lease or now or
hereafter existing at law or in equity or by statute or
otherwise, and the exercise or beginning of the exercise by
Landlord or Tenant or any one or more of the rights or remedies
provided for in this Lease or now or hereafter existing at law or
in equity or by statute or otherwise shall not preclude the
simultaneous or later exercise by Landlord or Tenant of any or
all other rights or remedies provided for in this Lease or now or
hereafter existing at law or in equity or by statute or
otherwise.
27. SURRENDER OF PREMISES. Upon the expiration or
termination of this Lease, Tenant agrees to quit and surrender
the Premises, clean and free of any and all hazardous or toxic
substances, hazardous wastes, infectious wastes, solid waste,
pollutants and contaminants which were released, spilled or
discharged into or on the Project during the Tenant's tenancy and
in the same condition and repair as on the date of execution
hereof, and Tenant shall remove the Casino and, at the discretion
of Landlord, any other improvements, fixtures or structures
installed or located within the Premises or any public right of
way at Tenant's sole cost and expense and without expense to
Landlord. If Tenant shall fail to remove any of Tenant's
property within 30 days after the receipt of notice of
termination or expiration of this Lease, Tenant's property shall,
at the option of Landlord, either be deemed abandoned and become
the exclusive property of Landlord, or Landlord shall have the
right to remove Tenant's property at the expense of Tenant,
without further notice to or demand upon Tenant and hold Tenant
responsible for any and all charges and expenses incurred by
Landlord therefor. If the Premises is not surrendered as and
when aforesaid, Tenant shall indemnify Tenant against all loss or
liability resulting from the delay of Tenant in so surrendering
the same including without limitation, any claims made by any
succeeding occupant founded on such delay. Tenant's obligations
under this Section shall survive the expiration or sooner
termination of the Term.
28. CURE OF TENANT'S DEFAULT. If Tenant shall fail to
make any payment or perform any act required hereunder to be made
or performed by Tenant then Landlord may, but shall be not be
obligated to, make such payment or perform such act with the same
effect as if made or performed by Tenant. Entry by Landlord upon
the Project for such purpose shall not waive or release Tenant
from any default or obligation hereunder. Tenant shall reimburse
Landlord for all sums paid and all costs incurred by Landlord in
performing the obligations of Tenant hereunder, including
attorneys' fees, upon Landlord's demand therefor which shall be
Additional Rent hereunder.
29. NOTICES. All notices, demands, request or other
communications ("notices") required or permitted by this Lease
shall be in writing and shall be deemed to be received when
actually received by any person at the intended address if
personally served or if sent by courier or telex, whether
actually received or not, twenty-four (24) hours after the date
and time of delivery to a nationally recognized courier,
addressed as follows:
To Landlord: St. Louis County Port Authority
Economic Council of St. Louis
County
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Real Estate
Copies to: Economic Council of St. Louis
County
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
St. Louis County
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: County Counselor
If to Tenant: Showboat Development Company
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Copies to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Either party may, in substitution of the foregoing, designate a
different address and addresses within the continental United
States for purposes of this section by written notice delivered
to the other party in the manner prescribed, at least ten (10)
days in advance of the date upon which such change of address is
to be effective. Any notices relating to maintenance shall be
given to those parties locally responsible as hereinafter
designated by the parties upon completion of the anticipated
improvements.
30. UNAVOIDABLE DELAY. As used in this Lease, the
term "Unavoidable Delay" shall mean any delay if and to the extent
caused by a fire, flood, tornado, earthquake, severe inclement
weather or other Act of God, strike, lockout or other labor
dispute, unavailability of essential materials, war, insurrection
or civil disorder. In no event shall lack of funds, Tenant's
failure to comply with Tenant's contractual obligations or
changes in the economy or marketplace constitute a basis for
asserting an Unavoidable Delay.
31. ARBITRATION OF CERTAIN DISPUTES.
(a) ARBITRATION OF SPECIFIC DISPUTES. In the event of
a dispute between the parties pursuant to Sections 9, 10, 12, 14,
16 or 19, the issue requiring resolution may be submitted by
either party to expedited arbitration in accordance with the
following procedures:
(b) ARBITRATION PROCEDURES. Arbitration shall be
commenced by written notice thereof from the party seeking
arbitration to the other party. Not later than 10 days after
delivery of such notice, each party shall select an independent
arbitrator who shall be an attorney licensed to practice law in
any state and practicing law for not less than 20 years. Not
later than 20 days after their selection, the two arbitrators
shall jointly select a third arbitrator having the same
qualifications as themselves. The arbitration panel shall meet
and determine the rules for submission and hearing of evidence
and so advise Landlord and Tenant not later than 10 days after
their selection. The panel shall convene and conduct a hearing
according to the rules established by them and shall render a
written decision which shall be binding on the parties not later
than 60 days after the date the third arbitrator has been
selected. The decision of the arbitration panel shall be final
and binding on the parties. Each party shall bear the fees and
expenses of its own arbitrator and shall share equally in the
payment of the fees and expenses of the third arbitrator.
32. ESTOPPELS. Each party acknowledges that from time to
time the other party may request, for the benefit of third
parties, information relating to the effectiveness of this Lease
and the Guarantees, whether this Lease or the Guarantees have
been modified or amended, the status of payments of Rent and
Additional Rent due hereunder, whether an Event of Default or a
Landlord Default has occurred and is continuing, and other
information reasonably and customarily required by lenders,
accountants and other parties having an interest in the Project,
or in Landlord, Tenant or Guarantor and their respective
operations. Each party agrees to respond in writing to any
request it may receive from the other party within 10 days after
its receipt of such request, and to provide all such requested
information.
33. RELATIONSHIP OF PARTIES. Nothing contained in this
Lease shall be deemed to constitute or be construed or implied to
create the relationship of principal and agent, partnership,
joint venture or any other relationship between the parties
hereto, other than the relationship of the landlord and tenant.
The term "Landlord" as used in this Lease means only the owner of
the current interest of Landlord in the Premises or, as the case
may be, the successor thereto from time to time.
34. NO BROKER. Tenant covenants, warrants and represents
to Landlord that there was no broker instrumental in consummating
this Lease and that no conversations or prior negotiations were
had by Tenant with any broker concerning the renting of the
Premises. Tenant agrees to indemnify and hold the Landlord
harmless against and from all liabilities, including reasonable
attorneys' fees, arising from any claims for brokerage
commissions or finders' fees resulting from or arising out of any
conversations or negotiations had by Tenant directly with any
broker.
35. CONFLICT OF INTEREST. The parties agree to abide by
all Governmental Requirements relating to conflict of interest.
Additionally, but not in limitation of the foregoing, no member,
officer, commissioner or employee of Landlord or any branch of
County government who has any power of review or approval of any
of the undertakings herein, shall participate in any decisions
relating thereto which affect his/her personal interests or the
interests of any corporation or partnership in which he or she is
directly or indirectly interested. No member, official or
employee of Landlord shall have any personal interest direct or
indirect, in this Lease, nor participate in any decisions
relating thereto which affect his or her personal interests or
the interests of any corporation or partnership in which he or
she is directly or indirectly interested. In the construction
and/or operation of the Project, Tenant shall not knowingly,
after due inquiry, employ or contract with any person if a member
of his or her immediate family is a member, officer, commissioner
or employee of Landlord or any branch of County government in an
administrative capacity, by which is meant those who have
selection, hiring, supervisory or operational responsibility for
the work to be performed pursuant to this Lease. For the
purposes of this section, "immediate family" includes: wife,
husband, son, daughter, mother, father, brother, sister, brother-
in-law, sister-in-law, father-in-law, mother-in-law, aunt, uncle,
niece, nephew, step-parent and stepchild.
36. ENTIRE LEASE. This Lease sets forth the entire
agreement between the parties. There are no understandings,
agreements, statements, promises, or representations or
warranties, express or implied, in respect of the Property, the
Project or this Lease which are not specified herein. This Lease
shall not be modified, amended or supplemented except by a
writing subscribed to by the party to be charged, nor may this
Lease be canceled by Tenant or the Project surrendered except in
accordance with the express provisions of this Lease.
37. SURVIVAL OF COVENANTS. All representations,
warranties and indemnities set forth in this Lease shall survive
the execution hereof.
38. BINDING EFFECT. This Lease binds the parties
hereto and inures to the benefit of their respective heirs,
personal representatives, successors or assigns.
39. TIME OF THE ESSENCE. Time is of the essence with
respect to the performance of this Lease and each and every
provision contained herein.
40. VENUE. If and in the event of a dispute arising
hereunder, venue shall be vested in the Circuit Court of St.
Louis County, State of Missouri. Tenant acknowledges that it has
negotiated this Lease in the County, and has made numerous
business contacts and entered into agreements relating to real
estate and other matters sufficient to confer jurisdiction of the
courts of St. Louis County, State of Missouri.
41. AUTHORIZATION AND CAPACITY. The parties hereto
represent to each other that each has the full right, power and
authority to enter into this Lease and to fully perform its
obligations. The persons executing this Lease warrant and
represent that each has the authority to execute in the capacity
stated and to bind the parties hereto.
42. THIRD-PARTY BENEFICIARIES. Landlord and
Tenant are the only parties to this Lease and the only parties
capable of or entitled to the enforcement of its provisions. Each
party confirms that no other parties are intended to be third party
beneficiaries of any covenant or provision of this Lease.
Notwithstanding the foregoing provisions of this Section 42,
Tenant acknowledges and agrees that the County shall be an
intended third party beneficiary of Tenant's designation of the
County as the "home dock" for the Project under Section 13.
43. SEVERABILITY. In the event any provision of
this Lease is rendered void or unenforceable by a court of
competent jurisdiction, the remaining provisions of this Lease
shall be construed so as to constitute a complete agreement, and
this Lease, as so reformed, shall remain in full force and effect.
44. NON-WAIVER PROVISION. Failure by either party
hereto,at any time, to require the performance by the other of
any term of this Lease, shall not in any way effect the right of
either party to enforce such terms, nor shall any waiver by either
party of any term hereof be taken or held to be a waiver of any
other provision of this Lease. No waiver of any term or provision
of this Lease shall be effective unless the same is in writing,
signed by the parties hereto.
45. GOVERNING LAW. This Lease is entered into in the
State of Missouri and shall be construed, enforced and governed, as to
both validity and performance, in accordance with the laws of the
State of Missouri and all of the rights and obligations of the
parties hereunder shall be determined in pursuant to the laws of
the State of Missouri.
46. RECORDING OF LEASE. From and after the
Commencement Date, either party may, at its own expense, cause a
memorandum of this Lease, approved by the other party, to be
recorded in the Office of the Recorder of Deeds for the County
of St. Louis.
47. ATTACHMENTS. All exhibits attached to this Lease
are incorporated herein and made part hereof by reference.
48. HEADINGS. The captions, headings and arrangements
in this Lease are for convenience only and do not in any way define,
limit or modify the terms or provisions hereof.
49. NUMBER AND GENDER OF WORDS. Whenever the
singular number is used in this Lease, the same shall include the plural
where appropriate and words of any gender shall include the other
gender where appropriate.
50. BUSINESS DAYS. Except as provided in Section 11,
whenever it is provided in this Lease that an event shall occur
on a day which is a Saturday, Sunday or legal holiday in the
State of Missouri, such event shall occur instead on the next
business day.
51. MULTIPLE COUNTERPARTS. This Lease may be
executed in a number of identical counterparts and if so executed,
each such counterpart is deemed an original for all purposes, and all
such counterparts shall collectively constitute one Lease.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Lease as the date first above written.
THIS LEASE CONTAINS A BINDING ARBITRATION PROVISION
WHICH MAY BE ENFORCED BY THE PARTIES
LANDLORD:
ST. LOUIS COUNTY PORT AUTHORITY
By:__/s/__________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chairman
APPROVED AS TO FORM
_/s/____________________
General Counsel, Economic Council
of St. Louis County
TENANT:
SOUTHBOAT LIMITED PARTNERSHIP
By: SHOWBOAT ▇▇▇▇▇, INC.
By:_/s/_________________________
Name:
Title:
ATTACHMENT A
Legal Description of the Property
ATTACHMENT B
Legal Description of the Premises
ATTACHMENT B-2
Diagram of the Premises
ATTACHMENT C-1
Diagram of the Premises and Adjacent Parcel
ATTACHMENT C-2
Diagram of the Parcel
ATTACHMENT D
Preliminary Site Plan