EXHIBIT 10.38.1
PUBLIC TRUST TIDELANDS LEASE AMENDMENTS
STATE OF MISSISSIPPI
COUNTY OF XXXXX
WHEREAS, under date of August 6, 1992, a Public Trust Tidelands Lease was
executed by and between the SECRETARY OF STATE, with the approval of the
GOVERNOR, for and on behalf of the STATE OF MISSISSIPPI, "LESSOR", and BH
ACQUISITION CORPORATION, a corporation registered to do and doing business in
the State of Mississippi, "LESSEE", a Memorandum of said Public Trust
Tidelands Lease having been recorded in Book 246, Page 201, of the records of
the Chancery Clerk of the Second Judicial District of Xxxxxxxx County,
Mississippi, and which lease covered certain lands situated in the Second
Judicial District of Xxxxxxxx County, Mississippi, "SAID PROPERTY", described
as follows, to-wit:
All submerged lands or tidelands and superjacent water column within the
following described parcel:
A parcel of land situated in Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx,
Xxxx of Biloxi, Second Judicial District, Xxxxxxxx County, Mississippi,
and more particularly described as follows, to-wit:
Commencing at a chiseled cross cut in the top of the concrete sea wall at
the intersection of the west line of the property described in Land Deed
Records of Xxxxxxxx County in Book 134 at Page 456, with said concrete
sea wall; thence run from said point of beginning North 88 degrees 15'
East along said concrete sea wall a distance of 874.65 feet to a point;
thence run South 00 degrees 26' East along said concrete sea wall a
distance of 1500 feet to a point; thence run South 88 degrees 14' 15"
West a distance of 867.66 feet to a point; thence run North 00 degrees
42' West a distance of 1500 feet to the point of beginning.
AND WHEREAS, in Paragraph 2 of the lease, the parties agreed that SAID
PROPERTY contains 544,064, more or less square feet of submerged lands, and
that an annual rental of $295,000.00 was to be paid by the Lessee during the
10 year primary term, and any extensions thereof, subject to rental
adjustments as provided for in Paragraph 3 of said lease. The annual rental
provided for in said lease was based upon an appraisal of SAID PROPERTY
considering that it would contain therein one (1) effective gaming vessel
area, and the parties now desire to amend the annual consideration set forth
in Paragraph 2 of said lease to now recite the sum of Five Hundred Twenty-Five
Thousand Dollars ($525,000.00) as an annual rental to accommodate an
additional or new casino vessel or barges to be located within an additional
effective gaming vessel area within said property. In making this amendment,
however, the parties hereto agree that the current rental amount set forth in
the August 6, 1992 lease shall remain the applicable rate until such time as
the additional or new vessel or barges is/are moored on the leased premises,
and that the Lessee shall have the flexibility to change its plans in the
future and return to casino operations on only one casino vessel, containing
no more casino floor space than the original vessel, and contained in the
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original effective gaming area by filing a Notice of Amendment with the
Lessor, which shall also allow the Lessee at the next annual payment due date
to resume payment of the annual rental as called for under the original Public
Trust Tidelands Lease. These alternatives may be located within a portion of
the leased premises containing 111,316.28 square feet to be located at the
southeast corner of the marina's inner basin and may accommodate such vessel
or vessels accommodating a total of not more than 41,000 square feet of gaming
floor space (both threshold amounts being subject to the 10% tolerance factors
provided for below).
AND WHEREAS, as one of the lease conditions set forth in Paragraph 9 of said
lease provided in Sub-Part 1 thereunder it is stated that the western one-
third (1/3) of the tract of filled tidelands at the southern end of the
Xxxxxxxxxx Xxxxxx is to be set aside for and landscaped as a park for the use
and enjoyment of the public. The parties now desire to amend said lease by
substituting the following paragraph in lieu of the existing Sub-Part 1 of
Paragraph 9:
(1) Free access shall be allowed to members of the public for a wide
variety of recreational activities. Although Lessee may use the tract of
filled tidelands at the Southern end of the Xxxxxxxxxx Xxxxxx for casino
access and parking lot (which may include a two story garage facility, should
Lessee desire to construct same during the term of this lease or any extension
thereof, and Paragraph 13 is modified to this extent). Lessee specifically
agrees to provide parking for all permitted uses developed on said property in
conformance with the City of Biloxi requirements and ordinances. Lessee
further agrees to conform in all material respects with City of Biloxi
Landscaping Rules and Regulations related to said parking facilities. Fishing
and crabbing shall be allowed on this portion of the filled tidelands, and the
public will be so advised by an appropriately posted sign. A minimum of three
parking spaces for handicapped persons will be designated and reserved at
convenient locations in the vicinity of the south xxxxxx cell's east, south
and west perimeter walls. That portion of the west peninsula of the marina
located north of the existing restaurant to include the presently grassed area
along U.S. Highway 90 will be designated and landscaped as a park for the use
and enjoyment of casino customers, hotel guests, marina visitors and members
of the public for strolling, jogging, fishing, crabbing, sunbathing and
picnicking, subject to rules and regulations reasonably necessary to ensure
the safety and convenience of all users. Lessee agrees to deposit the sum of
$165,000.00 in escrow with the Xxxxxxx Bank, and execute an escrow agreement
pertaining to same, within 30 days of the execution of this Amendment, and
these funds shall be utilized to cover the cost of construction of this
landscaped park as has been planned and approved and attached as Exhibit "A",
and Lessee shall initiate the construction within 60 days of the execution of
this Amendment.
AND WHEREAS, as another lease condition set forth in Paragraph 9 of said
lease provided in Sub-Part 3 thereunder it is stated that within one (1) year
of execution of this lease a combination pier - breakwater shall be
constructed adjacent to the west peninsula in order to mitigate the impact on
fisherman of limiting fishing activities to said west peninsula. The parties
now desire to amend said lease by the elimination of the words "in order to
mitigate the impact on fisherman of limiting fishing activities to said west
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peninsula", and also by adding the following sentence at the end:
Lessor and Lessee agree that, in lieu of actually constructing the pier -
breakwater within one year of execution of this lease, Lessee may satisfy
this requirement by depositing the sum of $33,000.00 in escrow within 30
days of the execution of this Amendment with the Xxxxxxx Bank, and
executing as escrow agreement pertaining to same, and these funds shall
be utilized to cover the cost (or a portion thereof if combined with
funds from other sources) of construction of this pier - breakwater, the
plans for which are attached as Exhibit "B", and Lessee shall initiate
the construction within 60 days of the execution of this Amendment.
Subject to Lessor's approval, these escrowed funds may be used to
construct or enhance a fishing pier at a location other than at the
Xxxxxxxxxx Xxxxxx.
AND WHEREAS, in the last unnumbered paragraph of Paragraph 9 of said lease
it is stated that these covenants are made by LESSEE as mitigation in exchange
for LESSOR'S agreement to pose no objection to LESSEE'S use of approximately
the eastern two-thirds (2/3) of the tract of filled tidelands at the southern
end of the Xxxxxxxxxx Xxxxxx for landscaped parking lots. The parties now
desire to amend said lease by the elimination of the words "approximately the
eastern two-thirds (2/3) of", and the addition of the word "entire" prior to
the words,..."tract of filled tidelands...".
AND WHEREAS, Paragraph 22 provides in the second unnumbered paragraph
thereof that SAID PROPERTY will be used for the docking of a single (emphasis
added) gaming vessel, and the parties desire to amend said Paragraph 22 to
provide for the docking of two gaming vessels or barges.
AND WHEREAS, said Paragraph 22 also provides in the second unnumbered
paragraph thereof that a minimum of 50% of the marina's berths were to be
available to members of the public, and the parties desire to amend said
Paragraph 22 to specifically recite that 90 marina berths shall be so set
aside.
NOW THEREFORE, for and in consideration of the sum of Ten Dollars ($10.00),
cash in hand paid, and other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, Lessor does hereby agree that
the annual rental provided for in said lease shall be amended to be the sum of
Five Hundred Twenty-Five Thousand Dollars ($525,000.00), pro rated as of the
date the additional or new vessel is moored on the premises, in order to
provide for an additional or new casino vessel and an expanded effective
gaming vessel area within said property, subject to Lessee's right to abandon
this expansion in the future and return to the original rental provided for;
that Sub-Parts 1 and 3, and the last unnumbered paragraph of Paragraph 9 are
amended as reflected hereinabove; and that Paragraph 22 is amended to
authorize the docking of two gaming vessels or barges within the subject
property, and also to specifically recite that 90 marina berths will be
available to members of the public after the second casino vessel has been
added.
It is furthermore agreed by and between the parties hereto that as a result
of this Amendment, the total effective gaming area under lease will increase
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by an additional 55,316.28 square feet from 56,000 square feet to 111,316.28
square feet. In order to provide for future flexibility in Lessee's
operations, the parties do furthermore agree that the Lessee may revise its
plat on file with the Lessor to change the configuration of the effective
gaming area without having to further amend the Public Trust Tidelands Lease.
In other words, if in the future Lessee decides to replace its casino
vessel(s) with a casino barge or barges, as long as the effective gaming area
remains 122,447.90 square feet or less and the casino floor space remains
45,100 square feet or less (which figures allow for a 10% tolerance factor of
11,131.62 gaming area square feet and 4,100 casino floor space square feet in
the event of any increase above either 111,316.28 square feet or 41,000 square
feet), the Lessee shall be allowed the flexibility to reconfigure the gaming
area under lease by simply filing a revised plat depicting same with the
Lessor in order to accommodate a different type of casino vessel. In the
event that Lessee's new vessel and/or barges occupy either a gaming area over
111,316.28 square feet or casino floor space over 41,000 square feet, it
agrees to pay $4.16 per square foot per year as increased rental for any such
tolerance increase in either the effective gaming or casino floor space area
over and above the referenced threshold amounts.
Except as hereby amended, said lease and all of its terms and provisions
shall otherwise remain unchanged.
EXECUTED this 10th day of November, 1993.
LESSOR:
STATE OF MISSISSIPPI
SECRETARY OF STATE
By: /s/ Xxxxx X. Xxxxxx
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Assistant Secretary of State
For: XXXX XXXXXX
Secretary of State
LESSEE:
BH ACQUISITION CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx,
President
APPROVED BY THE GOVERNOR OF
THE STATE OF MISSISSIPPI on the
10th day of November, 1993
/s/ Xxxx Xxxxxxx
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XXXX XXXXXXX, GOVERNOR OF THE
STATE OF MISSISSIPPI
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