EXHIBIT 10(q)
AMENDMENT TO LEASE
This Agreement is made this 31st day of May, 2002, by and between
LAST CHANCE, INC., a Nevada corporation ("Last Chance"), PROSPECTOR GAMING
ENTERPRISES, INC., a Nevada corporation, doing business as Gold Ranch Casino &
RV Resort ("PGE"), and TARGET INVESTMENTS, L.L.C., a Nevada limited liability
company ("Target").
RECITALS:
A. The parties have entered into that certain Gold Ranch Casino Lease
dated December 27, 2001 (the "Lease"), wherein Last Chance leased from PGE and
Target certain real and personal property located in Washoe County, Nevada, and
more particularly described therein, which Lease is evidenced by a Memorandum
of Lease recorded on May 31, 2002, in the Office of the County
Recorder, Washoe County, Nevada, as Document No. 2695017.
B. Any capitalized words or terms used but not otherwise defined herein
shall have the meanings ascribed to such words or terms in the Lease.
C. In order to assist Last Chance in acquiring the leasehold estate
evidenced by the Lease and to consummate the transactions contemplated by the
Integrated Agreements, Nevada State Bank ("Lender") has agreed to provide Last
Chance, The Sands Regent, a Nevada corporation, and Zante, Inc., a Nevada
corporation (collectively, the "Borrower"), with a loan in the principal amount
of $17,000,000.00 (the "Loan") to be secured, in part, by a leasehold deed of
trust encumbering Last Chance's leasehold interest created by the Lease (the
"Leasehold Deed of Trust").
D. As a condition to funding the Loan, Lender requires that the Lease
be amended to include certain provisions so that Lender may protect its interest
under the Leasehold Deed of Trust.
NOW, THEREFORE, for valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby amend the Lease
as follows:
1. PGE and Target agree that, until such time as all obligations
secured by Lender's Leasehold Deed of Trust have been fully satisfied other than
by a foreclosure sale or deed in lieu of foreclosure under the Leasehold Deed of
Trust, the following provisions shall apply:
(a) In the event of any breach or default by Last Chance or
any successor lessee under the Lease (collectively, the "lessee"), PGE and
Target shall provide Lender with written notice of such breach or default
simultaneously with providing notice thereof to the lessee.
(b) Lender shall have the right, but not the obligation, at
any time prior to the termination of the Lease and without payment of any
penalty, to pay all of the rents due thereunder, to effect any insurance, to pay
any taxes or assessments, to make any repairs or improvements, to
0
Xxxx Xxxx Xxxx Xxxxxxxx xxx Xxxxxx
Xxxxxxxxx and Counsellors at Law
Reno, Nevada
(000) 000-0000
take any other action required to be performed by the lessee under the Lease,
and to take action which may be necessary and proper to be done in the
performance and observance of the agreements, covenants and conditions of the
Lease to prevent the termination of the Lease. Lender shall have full access to
the Property for the purpose of accomplishing any of the foregoing. Any of the
foregoing done by Lender shall be effective to prevent a termination of the
Lease as if the same had been performed by the lessee.
(c) Notwithstanding anything contained in the Lease to the
contrary, in the event of a breach or default by the lessee under the Lease
(other than as a result of a breach or default under that certain Secured
Promissory Note in the principal amount of $5,618,734 dated May 31, 2002,
executed by Last Chance in favor of PGE (the "PGE Note")), neither PGE nor
Target shall be permitted to terminate the Lease so long as Lender shall
cure such breach or default within the period of time provided under the Lease
for lessee to cure such breach or default.
(d) Notwithstanding any contrary provision contained in the
Integrated Agreements as defined in that certain Asset Purchase Agreement dated
December 27, 2001 between PGE and Last Chance ("Asset Purchase Agreement") or
the PGE Note, Paragraph 9.I(C) of the Lease shall be amended to provide as
follows for as long as Lender or its successors and assigns (including, but
not limited to, the purchaser at a foreclosure sale under the Leasehold Deed of
Trust or the grantee under a deed in lieu of foreclosure) has any security
interest or other interest in the leasehold estate created by the Lease:
(C) the failure by Last Chance to observe or perform
any of the covenants, conditions or provisions of this Lease to be
observed or performed by Last Chance, other than described in Paragraph
9.1(B) above, or any of the covenants, conditions or provisions of the
California Lottery Station Lease (as defined in the Asset Purchase
Agreement) where such failure shall continue for a period of thirty (30)
days after written notice thereof from Landlord to Last Chance,
provided, however, that if the nature of Last Chance's default is such
that more than thirty (30) days are reasonably required for its cure,
then Last Chance shall not be deemed to be in default if Last Chance
commences such cure within said 30-day period and thereafter diligently
prosecutes such cure to completion.
(e) In the event that Lender is prohibited from curing any
breach or default by lessee under the Lease by reason of any process or
injunction issued by any court, or by reason of any automatic stay resulting
from any bankruptcy or insolvency proceeding involving the lessee, the times
provided for Lender to cure any breach or default shall be extended for the
period of the prohibition provided that Lender uses reasonable efforts to
promptly remove such prohibition.
(f) PGE and Target agree that in the event of a termination of
the Lease by reason of any breach or default by the lessee, or by reason of the
disaffirmance thereof by a receiver or trustee in bankruptcy for the lessee or
its property, PGE and Target upon request by Lender shall
0
Xxxx Xxxx Xxxx Xxxxxxxx xxx Xxxxxx
Xxxxxxxxx and Counsellors at Law
Reno, Nevada
(000) 000-0000
enter into a new lease of the Property, the Premises and the FF&E with Lender,
or its nominee, for the remainder of the term, effective as of the date of such
termination, at the rent and upon the terms, provisions, covenants and
agreements contained in the Lease, provided:
(i) Lender shall make written request upon PGE and
Target for the new lease within thirty (30) days after the date of termination;
(ii) Lender shall pay to PGE and Target at the time of
execution and delivery of the new lease any and all sums which would, at that
time, be due and payable pursuant to the Lease but for its termination; and
(iii) Lender has exercised its rights and remedies
under the Loan with respect to the Gold Ranch RV Resort, the California Lottery
Station, and the California Lottery Property (as those terms are defined in the
Asset Purchase Agreement).
(g) Upon the foreclosure by Lender of its Leasehold Deed of
Trust, or the acceptance of any deed in lieu of such foreclosure, PGE and Target
shall recognize the purchaser or other transferee in connection therewith as the
lessee under the Lease subject to the approval of such purchaser or other
transferee by PGE and Target, which approval shall not be unreasonably withheld
or delayed.
(h) In the event that Lender becomes the lessee under the
Lease or under any new lease executed pursuant to the terms hereof, the Lender
shall be liable for the obligations of the lessee under the Lease or the new
lease (but specifically excluding any obligation under the PGE Note) only for
the period of time that Lender remains the actual holder of the leasehold estate
under the Lease or the new lease. The Lender shall have the right to assign its
rights under the Lease, or any new lease, in conjunction with an assignment of
its rights in and to the Gold Ranch RV Resort, the California Lottery Station,
and the California Lottery Property, subject to the prior written consent of PGE
and Target, which consent shall not be unreasonably withheld or delayed.
2. Any notices required to be given hereunder shall be given to Lender
at the following address, or such other address as Lender shall provide to PGE
and Target in writing:
Xxxxxx Xxxxx Xxxx
X.X. Xxx 0000
Xxxx, Xxxxxx 00000
3. Except as herein amended, each and every term of the Lease shall
remain in full force and effect. In the event of any inconsistency or conflict
between the terms and provisions of this Agreement and the Lease, the terms and
provisions of this Agreement shall prevail to the extent of such inconsistency
or conflict.
0
Xxxx Xxxx Xxxx Xxxxxxxx xxx Xxxxxx
Xxxxxxxxx and Counsellors at Law
Reno, Nevada
(000) 000-0000
4. Nothing set forth herein shall in any way alter or limit Lender's
rights and remedies under the documents evidencing and securing the Loan.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above set forth.
LAST CHANCE, INC., a Nevada corporation,
By: /s/ Xxxxxx X. Xxxxx
-------------------------
XXXXXX X. XXXXX
Its: President
PROSPECTOR GAMING ENTERPRISES, INC.,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-------------------------
XXXXX XXXXXXXX
Its: President
TARGET INVESTMENTS, L.L.C., a
Nevada limited liability company
By: /s/ Xxxxx Xxxxxxxx
-------------------------
XXXXX XXXXXXXX
Its: Manager
0
Xxxx Xxxx Xxxx Xxxxxxxx xxx Xxxxxx
Xxxxxxxxx and Counsellors at Law
Reno, Nevada
(000) 000-0000
