Exhibit 10.1
EXCLUSIVE SPACE LEASE AGREEMENT
THIS EXCLUSIVE SPACE LEASE AGREEMENT ("Agreement") dated for identification
purposes only as of the ____ day of August, 1998, is entered into by and between
SPEAKEASY GAMING OF LAS VEGAS, INC., a Nevada corporation ("SGLV"), and ROGER
LYNN FULLER AND DEE CONNIE FULLER, dba DYNASTY GAMES DISTRIBUTING ("Dynasty").
W I T N E S S E T H :
WHEREAS, SGLV and Dynasty desire to enter into this Agreement in order
for Dynasty to lease space from SGLV for the placement, operation, and servicing
of gaming devices at the Location (as defined herein).
WHEREAS, the parties have agreed that upon the complete satisfaction of
all conditions precedent as described in this Agreement, Dynasty shall lease
space from SGLV for the placement, operation, and servicing of gaming devices at
the Location pursuant to the terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, SGLV and Dynasty hereby agree as follows:
ARTICLE I - DEFINITIONS
1.01 "Agreement" means this Agreement.
1.02 "Dynasty" means Roger Lynn Fuller and Dee Connie Fuller, dba
Dynasty Games Distributing.
1.03 "Change Person" means the person or persons employed by Dynasty as
change persons at the Location.
1.04 "Commencement Date" means the date Dynasty receives a
non-restricted license and all other required approvals from the Gaming
Authorities to operate gaming devices at the Location.
1.05 "Expiration Date" means one hundred twenty (120) days after the
Commencement Date, unless sooner terminated or renewed as provided in this
Agreement.
1.06 "Gaming Authorities" means, collectively, the Nevada Gaming
Control Board, the
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Nevada Gaming Commission, the City of North Las Vegas, and/or the County of
Clark.
1.07 "Gaming Devices" means the gaming devices Dynasty shall install
for the operation of gaming at the Location as more particularly described in
Section 5.02(A) hereof. The initial number of Gaming Devices to be installed
and operated at the Location shall be one hundred (100).
1.08 "Gaming Space" means the specific space the Location where the
Gaming Devices shall be located as determined by the parties' mutual agreement.
1.09 "Gaming Taxes" means the quarterly fee for a gaming license for a
restricted operation (NRS 463.373), the annual excise tax on slot machines (NRS
463.385), and any and all other license fees or taxes imposed on the operation
of the Gaming Devices by any governmental agency having jurisdiction over the
Location.
1.10 "Location" means the Ramada Inn and Speedway Casino located at
3227 Civic Center Drive, North Las Vegas, Nevada 89030.
1.11 "NGC Regulations" means, collectively, the Nevada Gaming Control
Act and the gaming regulations promulgated by the Nevada Gaming Commission.
1.12 "NRS" means the Nevada Revised Statutes.
1.13 "Operator of a Slot Machine Route" or "Route Operator" means the
person or entity that meets the definition of "Operator of a Slot Machine Route"
in NRS 463.018.
1.14 "SGLV" means Speakeasy Gaming of Las Vegas, Inc., a Nevada
corporation.
1.15 "Term" has the meaning ascribed to it in Section 4.01 of this
Agreement.
1.16 "Token" or "Tokens" means one dollar ($1) gaming tokens that have
been approved by the Gaming Authorities for use at the Location.
ARTICLE II - CONDITIONS PRECEDENT
2.01 CONDITION PRECEDENT. Dynasty acknowledges and agrees that
notwithstanding anything in this Agreement to the contrary, the requirement that
Dynasty, and any other person or persons associated with Dynasty required to be
licensed or found suitable by the Gaming Authorities, have been licensed or
found suitable by the Commencement Date to hold a non-restricted gaming license
for the Location shall constitute a condition precedent to the rights and
obligations of the parties under this Agreement and the validity and effect of
this Agreement.
ARTICLE III - EXCLUSIVE RIGHT
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3.01 EXCLUSIVE RIGHT. Subject to the termination provisions contained
in Article XII of this Agreement and satisfaction of the condition precedent
contained in Article II above, Dynasty hereby agrees to lease space from SGLV
and SGLV hereby agrees to lease space to Dynasty for the exclusive placement,
operation, and servicing of the Gaming Devices (the "Operation of Gaming
Devices") at the Location pursuant to the terms and conditions set forth in this
Agreement.
ARTICLE IV - TERM
4.01 TERM. Except as otherwise provided in this Agreement, the Term
shall commence on the Commencement Date and expire by its terms on the
Expiration Date without notice.
4.02 AUTOMATIC RENEWAL. This Agreement shall automatically renew for
consecutive and repetitive terms of sixty (60) days each (each a "Renewal
Term"), unless either party shall notify the other in writing at least thirty
(30) days prior to the end of the then expiring Term or Renewal Term of its
intention not to renew the Agreement.
ARTICLE V - SERVICE AND OPERATION OF GAMING DEVICES
5.01 DYNASTY'S RIGHTS AND RESPONSIBILITIES. Dynasty shall have the
exclusive space lease for the Operation of Gaming Devices during the Term of
this Agreement at the Location. SGLV shall have no participation in the
operation, service or maintenance, or revenue of the Gaming Devices or the costs
associated with operating, minting or servicing the Gaming Devices. Dynasty
shall maintain the Gaming Space in an orderly, clean, and sanitary fashion.
Dynasty shall be responsible for all Tokens to be used by Dynasty at the
Location, if any, and shall follow all requirements and obtain all approvals
related to the maintenance and use of Tokens set forth in the NGC Regulations.
5.02 LEASING OF GAMING DEVICES. Dynasty may lease a portion of the
Gaming Devices to be operated at the Location from PDS Financial Corporation
("PDS"). Upon termination of this Agreement, Dynasty shall assign and SGLV
shall assume all of Dynasty's right, title, and interest in and to the lease or
leases with PDS. Notwithstanding the preceding sentence, SGLV shall only be
required to assume the lease or leases with PDS if SGLV has obtained all
licenses and approvals from the Gaming Authorities to operate gaming at the
Location and own gaming devices (the "SGLV Gaming Approval"). Dynasty may also
lease Gaming Devices from other distributors. The parties agree that SGLV shall
assume such non-PDS leases, subject to the SGLV Gaming Approval, only if such
non-PDS leases are as favorable to SGLV as the PDS lease or leases are.
5.03 SGLV'S DUTIES AND RESPONSIBILITIES. SGLV shall provide Dynasty
with the equivalent of fifty (50) complimentary drinks per day. Dynasty shall
pay SGLV for drinks in excess of fifty (50) at SGLV's cost. SGLV shall also
provide security for the Location and for Dynasty to utilize for general
security purposes and for the drop and count of cash. Dynasty shall reimburse
SGLV for fifty percent (50%) of the actual cost to SGLV for employing such
security.
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ARTICLE VI - SPACE LEASE PAYMENTS
6.01 SPACE LEASE PAYMENTS. Dynasty shall pay to SGLV the following
amount as payment for the space lease:
(A) If Dynasty operates between 80 and 100 Gaming Devices at
the Location, Dynasty shall pay SGLV Twenty Dollars ($20) per Gaming Device per
day;
(B) If Dynasty operates between 101 and 125 Gaming Devices at
the Location, Dynasty shall pay SGLV Twenty Dollars ($25) per Gaming Device per
day beginning with the first five days the additional Gaming Devices are
installed at the Location;
(C) If Dynasty operates between 126 and 150 Gaming Devices at
the Location, Dynasty shall pay SGLV Twenty Eight Dollars ($28) per Gaming
Device per day beginning with the first day the additional Gaming Devices are
installed at the Location;
(D) If Dynasty operates between 151 and 200 Gaming Devices,
Dynasty shall pay SGLV Thirty Dollars ($30) per Gaming Device per day beginning
with the first day the additional Gaming Devices are installed at the Location.
If the parties agree that Dynasty may operate more than 200 Gaming
Devices at the Location, the parties shall determine in writing in advance the
amount per Gaming Device per day for the additional Gaming Devices. In no event
shall the amount per Gaming Device per day be less than Thirty Dollars ($30).
6.02 PAYMENT. Dynasty shall not be required to pay space lease
payments for the first month of the Term. Thereafter, space lease payments, as
adjusted in accordance with Section 6.01, shall be payable in advance on the
first day of each calendar month. For example, if the Commencement Date is
September 1, 1998, Dynasty shall pay the first space lease payment on October 1,
1998. All space lease payments, and all other amounts payable to SGLV by
Dynasty pursuant to the provisions of this Agreement, shall be paid to SGLV
without notice, demand, abatement, deduction or offset, in lawful money of the
United States at the Location or to such other person or at such other place as
SGLV may designate from time to time by written notice given to Dynasty. No
payment by Dynasty or receipt by SGLV of a lesser amount than the correct space
lease payment due hereunder shall be deemed to be other than a payment on
account; nor shall any endorsement or statement on any check or any letter
accompanying any check or payment be deemed to effect or evidence an accord and
satisfaction; and SGLV may accept such check or payment without prejudice to
SGLV's right to recover the balance or pursue any other remedy in this Agreement
or at law or in equity provided.
Dynasty shall pay to SGLV all amounts due and owing under Section
5.03 of this Agreement within seven (7) days of receiving an invoice from SGLV.
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6.03 LATE CHARGE; INTEREST. Dynasty acknowledges that the late payment
of space lease payments or any other amounts payable by Dynasty to SGLV
hereunder (all of which shall constitute additional rental to the same extent as
space lease payments) will cause SGLV to incur administrative costs and other
damages, the exact amount of which would be impracticable or extremely difficult
to ascertain. SGLV and Dynasty agree that if SGLV does not receive any such
payment on or before five (5) business days after the date the payment is due,
Dynasty shall pay to SGLV, as additional rent, (a) a late charge equal to five
percent (5%) of the overdue amount to cover such additional administrative
costs; and (b) interest on the delinquent amounts at the lesser of the maximum
rate permitted by law if any or twelve percent (12%) per annum from the date due
to the date paid.
ARTICLE VII - DYNASTY'S REPRESENTATIONS AND WARRANTIES
As a material inducement to SGLV to enter into this Agreement, Dynasty
covenants, represents, and warrants to SGLV, as of the date hereof as follows:
7.01 AUTHORITY; QUALIFICATION.
(A) Each of the individuals executing this Agreement has the full
right, power, and authority to enter into and carry out the transactions
contemplated by this Agreement. The entering into of this Agreement and the
carrying out of the transactions contemplated hereby does not and will not
constitute a default (or event which, with the giving of notice or the passage
of time, would constitute a default) under any agreement to which Dynasty or any
individual executing this Agreement is a party.
(B) This Agreement constitutes the valid and binding obligation
of Dynasty enforceable in accordance with its terms.
(C) The execution, delivery, and performance of this Agreement by
Dynasty will not materially conflict with or result in any material violation of
or constitute a material default under any judicial stipulation, judgment,
statute, writ, injunction, license, permit, or decree or order of any court or
other governmental authority relating to Dynasty and by which Dynasty is bound.
(D) There are no actions, suits, arbitration, or other legal,
administrative or other governmental proceedings pending or threatened against
or affecting Dynasty which might reasonably be expected to affect Dynasty's
ability to perform its obligations under this Agreement.
(E) All Gaming Devices installed in each of the Location under
this Agreement are or shall be approved by the Gaming Authorities and shall
comply with all applicable federal, state, county, and municipal laws.
(F) Dynasty currently has and shall retain throughout the Term a
Slot Machine Operator's License in good standing with the Gaming Authorities.
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ARTICLE VIII - SGLV'S REPRESENTATIONS AND WARRANTIES
As a material inducement to Dynasty to enter into this Agreement, SGLV
covenants, represents, and warrants to Dynasty, as of the date hereof as
follows:
8.01 AUTHORITY; QUALIFICATION.
(A) SGLV is duly incorporated and validly existing under the laws
of the State of Nevada. Each of the individuals executing this Agreement has
the full right, power, and authority to enter into and carry out the
transactions contemplated by this Agreement. The entering into of this
Agreement and the carrying out of the transactions contemplated hereby does not
and will not constitute a default (or event which, with the giving of notice or
the passage of time, would constitute a default) under any agreement to which
SGLV or any individual executing this Agreement is a party.
(B) This Agreement constitutes the valid and binding obligation
of SGLV enforceable in accordance with its terms. This Agreement and the
consummation of the transactions contemplated herein have been duly authorized
on behalf of SGLV by all requisite corporate action.
(C) The execution, delivery, and performance of this Agreement by
SGLV will not materially conflict with or result in any material violation of or
constitute a material default under:
(i) the Articles of Incorporation or Bylaws of SGLV.
(ii) any judicial stipulation, judgment, statute, writ,
injunction, license, permit, or decree or order of any court or other
governmental authority relating to SGLV and by which SGLV is bound.
(D) To the best of SGLV' knowledge, there are no actions, suits,
arbitration, or other legal, administrative or other governmental proceedings
pending or threatened against or affecting SGLV which might reasonably be
expected to affect SGLV' ability to perform its obligations under this
Agreement.
ARTICLE IX - INDEMNIFICATION AND INSURANCE
9.01 INDEMNIFICATION.
(A) INDEMNIFICATION BY DYNASTY. Dynasty shall indemnify, hold
harmless and, to the extent provided herein, defend SGLV, its shareholders,
affiliates, officers, directors, trustees, employees, agents, successors, and
assigns (collectively, "SGLV's Indemnified Persons") from and against, and
reimburse each of SGLV's Indemnified Persons with respect to, any and all
losses, damages, liabilities, costs, and expenses, including interest from the
date of such loss to the time of
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payment, and reasonable attorneys' fees (collectively, "Damages") incurred by
any of SGLV's Indemnified Persons by reason of or arising out of or in
connection with any act or omission of Dynasty or its agents, employees, or
contractors relating to Dynasty's use or occupancy of the Location, Dynasty's
operation of the Gaming Devices at the Location, or any patron dispute or
complaint lodged by the Gaming Authorities.
(B) INDEMNIFICATION BY SGLV. SGLV shall indemnify, hold
harmless and, to the extent provided herein, defend Dynasty, its officers,
directors, shareholders, and other affiliates, employees, agents, successors,
and assigns (collectively, "Dynasty's Indemnified Persons") from and against,
and reimburse each of Dynasty's Indemnified Persons with respect to, any and all
Damages incurred by any of Dynasty's Indemnified persons by reason of or arising
out of or in connection with any act or omission of SGLV or its agents,
employees, or contractors relating to SGLV's use or occupancy of the Location.
9.02 LIABILITY INSURANCE. At all times during the Term, Dynasty shall
procure and maintain, at its sole expense, commercial general liability
insurance applying to the use and occupancy of the Location. Such insurance
shall be primary and non-contributing with any other insurance procured by
Dynasty and shall have a minimum combined single limit of liability of at least
$1,000,000 per occurrence and a general aggregate limit of at least $3,000,000.
All such policies shall be written to apply to all bodily injury, property
damage, robbery of and/or by a gaming patron, or personal injury losses, and
shall be endorsed to include SGLV as an additional insured. Such liability
insurance shall be written as primary policies, not excess or contributing with
or secondary to any other insurance as may be available to the additional
insureds.
9.03 WORKERS' COMPENSATION INSURANCE. At all times during the Term,
Dynasty shall procure and maintain Workers' Compensation Insurance in accordance
with the laws of the State of Nevada for all of its employees working in or
around the Location.
ARTICLE XI - ASSIGNMENT
11.01. RESTRICTION - DYNASTY. Without the prior written consent of
SGLV, Dynasty shall not, either voluntarily or by operation of law, assign,
encumber, or otherwise transfer this Agreement or any interest or rights herein.
An assignment or other action in violation of the foregoing shall be void and,
at SGLV's option, shall constitute a material breach of this Agreement.
ARTICLE XII - DEFAULT, REMEDIES AND TERMINATION
12.01 EVENTS OF DEFAULT BY DYNASTY. The occurrence of any of the
following shall constitute a material default and breach of this Agreement by
Dynasty:
(A) The failure by Dynasty to continuously remain licensed and
in good standing with the Gaming Authorities as an Operator of a Slot Machine
Route at all times during the Term.
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(B) The failure by Dynasty to pay SGLV any amounts due and
owing under this Agreement when due.
(C) The failure by Dynasty to observe or perform any material
provision of this Agreement to be observed or performed by Dynasty if such
failure continues for thirty (30) days after written notice thereof by SGLV to
Dynasty.
(D) The making by Dynasty of any general assignment for the
benefit of creditors, the filing by or against Dynasty of a petition under any
federal or state bankruptcy or insolvency laws (unless, in the case of a
petition filed against Dynasty, the same is dismissed within thirty (30) days
after filing); the appointment of a trustee or receiver to take possession of
any of Dynasty's assets at the Location or Dynasty's interest in this Agreement;
or the attachment, execution, or other seizure of any of Dynasty's assets
located at the Location or SGLV's interest in this Agreement, if such seizure is
not discharged within thirty (30) days.
12.02 SGLV'S RIGHT TO TERMINATE UPON DYNASTY DEFAULT. In the event of
any material default by Dynasty as provided in Section 12.01 above, SGLV shall
have the right to immediately terminate this Agreement and recover possession of
the Gaming Space by giving written notice to Dynasty of SGLV's election to
terminate this Agreement, in which event SGLV shall be entitled to pursue any
remedies available to it under the law and this Agreement. The notice shall
give in reasonable detail the nature and extent of the failure and shall
identify the Agreement provision(s) containing the obligation(s).
12.03 TERMINATION WITHOUT CAUSE. Notwithstanding anything in this
Agreement to the contrary, Dynasty, in its sole discretion, may terminate this
Agreement for any reason, or for no reason, upon thirty (30) days prior written
notice to SGLV.
12.04 TERMINATION UPON SGLV GAMING APPROVAL. This Agreement shall
terminate immediately upon SGLV's obtaining the SGLV Gaming Approval.
12.05 PROCEDURE UPON TERMINATION. Upon the expiration, termination, or
cancellation of this Agreement, SGLV and Dynasty shall assist each other in the
orderly and non-disruptive conclusion hereof. Upon the effective date of such
expiration, termination, or cancellation of this Agreement, Dynasty, subject to
SGLV's responsibilities to assume the Gaming Device lease or leases, shall
remove all Gaming Devices and other property owned by Dynasty the Location in a
manner which creates the least amount of damage to property and disruption
within the Location. The cost for the removal of Dynasty's property and the
restoration of the Gaming Space to SGLV's reasonable satisfaction shall be borne
and paid by Dynasty. Upon the expiration, termination or cancellation of this
Agreement, Dynasty shall pay to SGLV all amounts due and owing under this
Agreement.
12.06 NON-WAIVER. Nothing in this Article shall be deemed to affect
either party's rights to indemnification for liability or liabilities arising
prior to termination of this Agreement for personal
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injury or property damages under the indemnification clause or clauses
contained in this Agreement.
ARTICLE XIII - NOTICES
13.01 NOTICES. All notices which Dynasty or SGLV may be required,
or may desire to serve on the other, may be served, as an alternative to
personal service, by mailing the same by registered or certified mail, postage
prepaid, addressed to Dynasty and SGLV at the addresses set forth below, or
addressed to such other address or addresses as either Dynasty or SGLV may from
time to time designate to the other in writing. Any notice shall be deemed to
have been served at the time the same was posted.
If to Dynasty: If to SGLV:
Dynasty SGLV
57 East Freeport Blvd. 200 East Sixth Street
North Las Vegas, Nevada 89030 Reno, Nevada 89501
Attn: Roger Fuller Attn: Bruce Dewing
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
with copy to: with copy to:
___________________________ Jones Vargas
___________________________ 201 W. Liberty Street
___________________________ Reno, Nevada 89501
___________________________ Attn: Michael G. Alonso
ARTICLE XIV - MISCELLANEOUS
14.01 FORCE MAJEURE. Neither party shall incur any liability to the
other with respect to, and shall not be responsible for any failure to perform,
any obligations hereunder if such failure is caused by any reason beyond the
control of either party including, but not limited to, strike, labor trouble,
governmental rule, regulations, ordinance, statute, or interpretation, or by
fire, earthquake, civil commotion, or failure or disruption of utility services.
The amount of time for either party to perform any of their obligations shall be
extended by the amount of time each party is delayed in performing such
obligation by reason of any force majeure occurrence whether similar to or
different from the foregoing types of occurrences.
14.02 NEVADA LAW. The laws of the State of Nevada applicable to
contracts made and wholly performed therein shall govern the validity,
construction, performance, and effect of this Agreement.
14.03 ASSIGNMENT; BINDING EFFECT. Neither party may assign, transfer,
or convey any of its
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rights herein or hereunder to any person or entity whatsoever without the
prior written consent of the other party hereto. Any attempt to assign or
transfer this Agreement without such consent shall be considered null and
void and of no force and effect. This Agreement shall inure to the benefit
of and be binding upon the parties hereto, their respective successors and
permitted assigns.
14.04 SEVERABILITY. In the event any provision of this Agreement is
found to be unenforceable, the remainder of this Agreement shall not be
affected, and any provision found to be invalid shall be enforceable to the
extent permitted by law. The parties agree that in the event two different
interpretations may be given to any provision hereunder, one of which will
render the provision unenforceable, and one of which will render the provision
enforceable, the interpretation rendering the provision enforceable shall be
adopted.
14.05 TIME OF ESSENCE. Time is of the essence in this Agreement and all
of the terms, provisions, covenants, and conditions hereof.
14.06 CAPTIONS. The captions appearing at the commencement of the
Articles and Sections hereof are descriptive only and for convenience in
reference to this Agreement and in no way whatsoever define, limit, or describe
the scope or intent of this Agreement.
14.07 PRONOUNS. Masculine or feminine pronouns shall be substituted for
the neuter form and vice versa in any place or places herein in which the
context requires such substitution or substitutions.
14.08 KNOWLEDGE OF PARTY. Any representation or warranty herein
contained made by or on behalf of a party to the knowledge of such party shall
be deemed to mean and be limited to actual knowledge of an executive officer of
such party of the matter in question, or actual knowledge of such facts as would
charge such executive officer of such party with knowledge of the matter in
question.
14.09 ENTIRE AGREEMENT; AMENDMENT; WAIVER. This Agreement constitutes
the entire agreement between the parties pertaining to the subject matter
contained in it and supersedes all prior agreements, brochures, informational
memoranda, representations, and understandings of the parties. This Agreement
may not be modified or terminated orally; and no modification, termination, or
waiver will be valid unless contained in a writing signed by both parties. In
addition, no such modification, termination, or waiver shall be effective for
any purpose unless it is signed by SGLV. Except as may be otherwise provided in
this Agreement, no waiver of any of the provisions, whether or not similar, nor
shall any waiver constitute a continuing waiver, and no waiver shall be binding
unless evidenced by an instrument in writing executed by the party against whom
the waiver is sought to be enforced.
14.10 NO THIRD PARTY BENEFICIARY. This Agreement is for the benefit of,
and may be enforced only by, Dynasty and SGLV and their respective successors
and permitted assigns, and is not for the benefit of, nor intended to be for the
benefit of, and may not be enforced by, any third
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party.
14.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, with each counterpart being deemed to be an original instrument,
but all such counterparts together shall constitute but one agreement.
14.12 ATTORNEY'S FEES. If any action is brought by any party hereto
concerning a breach of any of the provisions of this Agreement, the prevailing
party shall be entitled to recover from the other party the reasonable
attorneys' fees and expenses of the prevailing party incurred in connection
therewith.
14.13 NO PARTY DEEMED DRAFTER. The parties agree that neither party
shall be deemed to be the drafter of this Agreement and that in the event this
Agreement is ever construed by a court of law or entity, such court shall not
construe this Agreement or any provision hereof against either party as the
drafter of the Agreement, Dynasty and SGLV acknowledging that each has
contributed substantially and materially to the preparation hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
date written below.
SGLV: Dynasty:
SPEAKEASY GAMING OF LAS VEGAS,
INC., a Nevada corporation /s/ Robert L. Fuller
--------------------------
ROGER LYNN FULLER
By: /s/ Bruce E. Dewing Date: 8/25/98
-------------------------------
Print Title: Vice President /s/ Dee Connie Fuller
---------------------- --------------------------
DEE CONNIE FULLER
Date:
-----------------------------
Date: Sept. 1, 1998
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