Exhibit 10.2
Execution Copy 06/27/2011
ASSET PURCHASE AND TRANSITION AGREEMENT
This Asset Purchase and Transition Agreement (“Agreement”) is made and entered
into on this 28th day of June, 2011 (“Effective Date”), by and between HCC
CORPORATION, a Nevada corporation (“Seller”), doing business as GRAND LODGE
CASINO (“the Casino”), Seller and GAMING ENTERTAINMENT (NEVADA), LLC a Nevada
Limited Liability Company, (“Buyer”). Collectively, Seller and Buyer are
sometimes referred to herein as the “Parties.”
RECITALS:
A. The Seller owns all of the assets, tangibles, intangibles, going business,
inventory, liabilities, name and goodwill of the Casino, located at the Hyatt
Regency Lake Tahoe Resort, Spa and Casino, 111 Country Club Drive, Incline
Village, and Nevada 89451, operating a casino business (the Business”).
B. The Buyer desires to purchase and the Seller desires to sell certain of the
assets used in connection with the operation of the Business, as hereafter
described (the “Assets”), and to assume certain liabilities incurred in
connection with the operation of the Business (“Assumed Liabilities”) and
following Closing, Buyer desires to operate the Business.
C. In addition, Buyer agrees to certain specific matters regarding the employees
of
Seller at the Casino all as more fully set forth herein.
D. The purpose of this Agreement is to set out the mutual covenants,
representations, warranties and promises of the Parties in connection with the
Buyer’s acquisition of the Assets of the Business.
E. In consideration of the foregoing facts and the mutual covenants,
representations and warranties contained herein, and with the intention of being
legally bound hereby, the Parties hereto agree as follows:
ARTICLE I
PURCHASE OF PRIMARY ASSETS
1.1 Sale of Primary Assets. Upon the terms and subject to the conditions set
forth in this Agreement, Seller agrees to sell and Buyer agrees to purchase:
1.1.1 The gaming and other tangible personal property described in the
appraisal, attached hereto as Schedule A, plus such other tangible personal
property which may be or, in accordance with the terms of this Agreement, have
been acquired after the date of the appraisal to the extent the same is used in
the business, and less any such property as may have been disposed of, by the
Casino prior to the Closing. The price of such assets shall be the values as
itemized on Schedule A, plus the actual cost of any additions, and less the
value as listed on Schedule A of any deletions.

 

 

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1.1.2 Gaming inventories, including, without limitation, inventories of cards,
dice and gaming equipment parts described on Schedule B attached hereto, plus
such other inventories as may hereafter have been acquired, and less any such
inventory as may have been disposed of, in the ordinary course of Casino
business, prior to Closing. The purchase price for these inventories shall be
the amounts indicated on Schedule B, plus the actual cost of any additions and
deletions.
1.1.3 Operating supplies, including, without limitation, office supplies and
equipment, and other miscellaneous supplies located on the premises, provided
that any equipment or supplies with a value of $100.00 or greater is scheduled
on Schedule E, attached hereto. The price for the operating supplies shall be
Seven Thousand Five Hundred Dollars ($7,500.00).
1.1.4 Copyrights, trade names, trademarks, domain names, customer lists, good
will and other related intangible assets relating to the Business (excluding the
corporate names of Seller), and specifically including the names “Grand Lodge
Casino” and “Player Advantage Club”, all internet domain names and URLs related
thereto, and all rights in and to those names, including but not limited to the
intellectual property set forth on Schedule C. The purchase price for these
assets shall be One Dollar ($1.00). The trademarks GRAND LODGE CASINO and PLAYER
ADVANTAGE CLUB, and the respective Federal Trademark Registration Nos 3,760,969
and 2,639239, are owned by the Seller. Additionally, Seller shall transfer to
Buyer the domain name <grandcasinolodge.com> which Seller’s marketing company
Mosac Marketing Group, Inc. (“Mosac”) has transferred to Seller.
1.1.5 Subject to Section 7.4, all assignable rights and obligations under any
written or oral contracts, agreements, leases, instruments, or other documents
or commitments, arrangements, undertakings, practices or authorizations related
to the Primary Assets or the operations of the Business (collectively the
“Contracts);
1.1.6 All documents and books and records related to the Primary Assets or the
operations of the Business, including, without limitation, customer, supplier,
mailing and player lists, and casino files relating to the Business; and
1.1.7 All other intangible property owned or leased by Seller required for the
operation of the Business, including, without limitation, goodwill, operating
and training manuals, federal, state, and local certifications and other permits
(to the extent assignable), manuals and plans relating to the Business or its
operations, and other documents relating to the operation of the Primary Assets,
(together with the assets described in Sections 1.1.5 and 1.1.6, the
“Intangibles”);

 

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1.2 Aggregate Purchase for Primary Assets.
The aggregate purchase price for the primary assets shall be the sum of the
amounts reflected in Sections 1.1.1 through 1.1.7 above, and shall be payable,
plus or minus the settlement amount referred to in Section 2.4, by wire transfer
at Closing to an account specified by Seller and identified by Buyer at least
five (5) days prior to Closing.
1.3 Closing. The Closing shall take place at a mutually convenient location
within Nevada on a date to be agreed which is shall be no later than 15 days
following the grant of a gaming license to the Buyer by the Nevada Gaming
Commission. This Agreement is specifically conditioned upon (a) the Buyer
obtaining a non-restricted gaming license to operate the assets being
transferred and (b) Buyer entering into a Lease for the Premises in which the
assets are operated with Hyatt Equities LLC and Buyer shall have no obligation
hereunder unless and until such gaming license is issued and effective. Either
Party shall have the right to terminate this Agreement, at any time (i) on or
after September 1, 2011, in the event the above referred to Lease has not been
executed on or before said date, or (ii) on or after November 1, 2011, in the
event the above referred to gaming license shall not have been obtained on or
before said date.
ARTICLE 2
TREATMENT OF CERTAIN CURRENT ASSETS
AND
ASSUMPTION OF CERTAIN CURRENT LIABILITIES
2.1 Current Assets. Seller shall transfer to Buyer the following current assets:
“cash on premises”, prepaid equipment rentals and other transferrable prepaid
items, and casino markers in the Seller’s possession at the date of Closing. For
purposes hereof, “cash on premises” shall mean all Seller owned currency located
in the Casino at the Closing and shall include, without limitation, cage cash
and cash in drop boxes, bill validators and ticket redemption kiosks.
2.2 Current Liabilities. At Closing, Buyer shall assume the following
liabilities: outstanding chip/TITO ticket liabilities, progressive jackpot
liabilities, and Player Club points. Buyer shall notify Seller at least thirty
(30) days prior to Closing of the extent to which Buyer will assume any accrued
vacation pay for Casino employees hired by Buyer, however, such election by
Buyer may be made only in respect to all former Seller employees hired by Buyer
and not any lesser number of such employees.
2.3 The value of the current assets and current liabilities described above
shall be valued at their actual amounts as of the Closing Date with the
following adjustments.
2.3.1 Prior to the Closing, Seller and Buyer shall agree to an allowance for
uncollectible markers and the method of calculating such allowance.
2.3.2 The amount for progressive jackpots will be included only for the amount
in excess of the seed money, although the liability to be assumed will be the
entire liability, provided however that in the computation of the purchase
price, Buyer will pay an amount equal to seventy-five percent (75%) of the seed
money.

 

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2.4 Settlement at Closing. A preliminary amount for the current assets and
current liabilities described in this Article will be agreed upon between Seller
and Buyer prior to the Closing. If current assets exceed current liabilities,
Buyer shall pay to Seller such additional amount at Closing. If current
liabilities exceed current assets as described in this Article, Seller shall pay
that amount in cash to Buyer or issue a credit to Buyer at closing.
2.5 Post Closing Adjustment. Within sixty (60) days of Closing, the Parties
shall agree on any adjustments necessary to the current assets and current
liabilities described in this Article, and settlement of any adjustments shall
be made in cash at that time. Such post-closing adjustment shall be final and
binding on the Parties.
ARTICLE 3
ADDITIONAL RIGHTS ASSIGNED TO BUYER
3.1 At the Closing, Seller shall assign to Buyer the trademark and trade name
rights as described on Schedule C and the equipment leases and contracts
described on Schedule D. Buyer shall have the responsibility for obtaining any
and all consents necessary to assign such leases and contracts, which Buyer
shall obtain prior to Closing. Seller agrees to cooperate with Buyer to
accomplish such assignments.
3.2 Seller shall retain and are not transferring any insurance policies or other
deposits not specifically described herein, and reserve all rights with respect
to those items.
3.3 Seller shall be responsible for any accrued payroll liabilities to employees
through the Closing date, except to the extent specifically assumed by Buyer
hereunder.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Buyer to enter into this Agreement and to consummate the
transactions contemplated hereby, the Seller represents and warrants to the
Buyer that at the time of entering into this Agreement and as of the Closing
Date, the following representations and warranties, which shall survive Closing
for the period provided herein, are true and accurate:
4.1 Organization and Standing. Seller is a Nevada corporation, duly organized,
validly existing and in good standing under the laws of the State of Nevada.
Seller is duly licensed and qualified to do business in the State of Nevada and
to carry on the Business in the State of Nevada
4.2 Ownership of Assets and Operation of Business. That Seller has good title to
the Assets, and has the right to sell, assign and transfer the same free and
clear of all liens, pledges and encumbrances of any kind. There are no
outstanding options or other agreements obligating the Seller to convey or
encumber the Assets of the Business.

 

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4.3 Authority. The Seller represents and warrants that it has full legal power,
capacity and authority to execute and deliver this Agreement and Schedules
hereto, and to consummate the transactions contemplated hereby, and that this
Agreement has been duly and validly executed and delivered by Seller and
constitutes a valid and binding Agreement of Seller, enforceable in accordance
with its terms. The person or persons executing this Agreement and any document
provided pursuant to this Agreement or at Closing by or on behalf of Seller is
duly authorized and empowered to execute such document on behalf of Seller and
to bind Seller to such action. The entry into and performance of this Agreement
will not violate any understanding, agreement, commitment of Seller or any law,
rule, regulation, ordinance, code or statute to which Seller are subject or
obligated. The execution, delivery and performance of this Agreement by Seller
and the consummation of the transactions contemplated by this Agreement are not
contrary to the Articles of Incorporation or Bylaws of Seller. The execution,
delivery or performance of this Agreement by Seller and the consummation of the
transactions contemplated by this Agreement will not (a) with the passage of
time, the giving of notice or otherwise, result in a violation or breach of, or
constitute a default under, any term or provision of any indenture, mortgage,
deed of trust, lease, instrument, contract, agreement or other restriction to
which Seller is a party or to which any of Primary Assets is subject, (b) result
in the creation of any lien or other charge on any of the Primary Assets,
(c) result in an acceleration or termination of any note, loan or security
agreement or similar agreement or instrument to which Seller is a party or by
which any of Primary Assets are bound, or (d) result in a violation of any
order, judgment, decree, rule, regulation or law applicable to Seller.
4.4 Good and Marketable Title to Assets. Buyer shall acquire good title to, and
all right, title and interest in, the Assets, free and clear of all claims,
charges, liens and encumbrances.
4.5 Liabilities. Except as expressly provided in this Agreement, Seller
represent and warrant that Buyer will not be responsible for any obligation of
Seller incurred prior to Closing.
4.6 Tangible Personal Property. Schedule A contains a true and complete list of
all tangible personal property sold hereby as of the date or dates set forth in
Schedule A, and Seller represent that all of the personal property used in
connection with the operation of the Business Assets and inventory are sold
AS-IS. Seller shall deliver a supplement to Schedule A, showing additions or
deletion since those dates not later than five (5) days prior to the Closing,
and such supplement shall, upon delivery to Buyer, be deemed included in the
representations and warranties contained in this Section 4.6. Seller makes no
warranties as to the condition of the Assets and inventory, except that Seller
represents and warrants that the Assets are free and clear of any liens and
encumbrances, and that Seller will convey good title to the Assets (including
all inventory) to Buyer at Closing. Buyer is responsible for inspecting the
Assets. Buyer understands that it is purchasing all of the inventory.
4.7 Employees. As previously disclosed to Buyer, Seller has entered into certain
employment agreements, consulting agreements and severance agreements with
current and former employees of Seller. Buyer assumes no responsibility or
liability with respect thereto.
4.8 Employee Benefits. Seller maintain various employee benefit plans pursuant
to which Seller provided benefits or compensation to or on behalf of employees
or former employees of Seller, whether or not written. Buyer assumes no
responsibility or liability for any plans.

 

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4.9 Litigation. There is no (i) action, suit claim, proceeding or investigation
pending or to the best knowledge of Seller, threatened against Seller at law or
in equity or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, (ii) arbitration proceeding pending relating to the Business, or
(iii) governmental inquiry pending. The Business is not in default with respect
to any order, writ, injunction or decree served upon it from any court or any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign. There is no action or
suit by the Business pending against others.
4.10 Broker. Seller has not engaged a Broker and is not responsible for any
payment to any finder, broker or consultant in connection with the transactions
contemplated by this Agreement.
4.11 Disclosure. All documents prepared by Seller or the Business in connection
with this Agreement and the transactions contemplated hereby, including but not
limited to all financial statements, are materially correct.
4.11.1 Omission. To the best of their knowledge, neither this Agreement nor any
schedules or exhibits hereto contain any untrue statements of a material fact or
omit to state a material fact necessary in order to make the statements
contained therein not misleading.
ARTICLE 5
ADDITIONAL OBLIGATIONS OF THE SELLER
The Seller further promise, covenant and agree as follows:
5.1 Transfer of Assets. That the Seller shall give full, complete and actual
possession of the Assets to the Buyer on the Closing Date.
5.2 Limitations of Seller. That from the date of this Agreement to the Closing
Date, the Seller shall:
5.2.1 Not transfer, convey, lease, mortgage, refinance or otherwise encumber any
of the Assets;
5.2.2 Fully cooperate with all reasonable requests of the Buyer to accomplish
the transfer and assignment of all assignable licenses and permits;
5.2.3 Exercise commercially reasonable efforts to have current suppliers
continue with Buyer on same terms and conditions. Seller shall furnish a list of
all the currently active suppliers to the Business and contain the terms of the
arrangements with them; and
5.2.4 Pay in full through and including Closing all taxes required to be paid by
the Seller or the Business, and all accrued employee payroll through the
Closing, except to the extent as specifically assumed by Buyer hereunder.
5.2.5 Continue the business of Seller in substantially the method, manner and
fashion is has been conducted and make no material changes to the business or
its operations, except for (i) drawdowns in the amount of cash on premises, and
(ii) additions to or deletions of Assets in accordance with the provisions of
this Agreement.

 

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5.2.6 Arrange for and execute any and all consents to assign or transfer any
contracts being assigned to or assumed by Buyer.
5.2.7 Not make any additions to or deletions of the Assets with a value in
excess of $1,000.00 without the consent of Buyer, which consent, with respect to
additions and deletions made in the ordinary course of the Business and on a
basis consistent with prior practices, shall not be unreasonably withheld.
5.3 Closing Deliveries. That on the Closing Date, the Seller shall execute, if
appropriate, and delivery to the Buyer:
5.3.1 A Bill of Sale transferring and assigning the Assets to the Buyer;
5.3.2 Seller will execute any other instruments necessary or appropriate to
transfer to the Buyer all of Seller’s right, title and interest in and to the
Assets;
5.3.3 To the extent assignable, an assignment by the Seller to the Buyer of all
licenses, permits and approvals from all governmental authorities necessary to
enable the Buyer to manage and operate the Business and the Assets in the same
manner that the Business and the Assets are now being managed and operated; and
5.3.4 Assignments of the items specified in Section 3.1 above.
5.4 Further Assurances. That the Seller will, at any time and from time to time
after the Closing Date, upon the Buyer’s reasonable request, execute,
acknowledge and deliver or will cause to be done, executed, acknowledged and
delivered all such further acts, deeds, assignments, transfers, conveyances and
assurances as may reasonably be required for the better assigning, transferring,
granting and confirming title of the assets to the Buyer, or to its successors
and assigns.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF THE BUYER
As an inducement to the Seller to enter into this Agreement and to consummate
the transactions contemplated hereby, the Buyer represents and warrants to the
Seller as follows:
6.1 Power and Authority. The Buyer has the authority to execute, deliver and
perform this Agreement. The documents to be executed and delivered by the Buyer
have been duly executed and delivered by, and constitute the legal, valid and
binding obligation of the Buyer and are enforceable against the Buyer in
accordance with their terms. The person or persons executing this Agreement and
any document provided pursuant to this Agreement or at Closing by or on behalf
of Buyer is duly authorized and empowered to execute such document on behalf of
Buyer and to bind Buyer to such action. The entry into and performance of this
Agreement will not violate any understanding, agreement, commitment of Buyer or
any law, rule, regulation, ordinance, code or statute to which Buyer is subject
or obligated. The entry into and performance of this Agreement will not violate
any understanding, agreement, commitment of Buyer or any law, rule, regulation,
ordinance, code or statute to which Buyer is subject or obligated. The
execution, delivery and performance of this Agreement by Buyer and the
consummation of the transactions contemplated by this Agreement are not contrary
to the Articles of Formation or Operating Agreement of Buyer. The execution,
delivery or performance of this Agreement by Buyer and the consummation of the
transactions contemplated by this Agreement will not (a) with the passage of
time, the giving of notice or otherwise, result in a violation or breach of, or
constitute a default under, any term or provision of any indenture, mortgage,
deed of trust, lease, instrument, contract, agreement or other restriction to
which Buyer is a party, (b) result in an acceleration or termination of any
note, loan or security agreement or similar agreement or instrument to which
Buyer is a party, or (c) result in a violation of any order, judgment, decree,
rule, regulation or law applicable to Buyer.

 

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6.2 Disclosure. All documents delivered or to be delivered by or on behalf of
Buyer in connection with this Agreement and the transactions contemplated hereby
are true, complete and correct. To the best of Buyer’s knowledge, this Agreement
does not contain any untrue statement of a material fact or omit a material fact
necessary to make the statements contained herein or therein, in light of the
circumstances in which made, not misleading.
6.3 Broker. Buyer represents that it has not engaged any broker or agent related
to this transaction.
ARTICLE 7
ADDITIONAL OBLIGATIONS OF THE BUYER
The Buyer further promises, covenants and agrees as follows:
7.1 Cooperation. To fully cooperate with the Seller to insure that the transfer
of possession takes place with the least possible disruption.
7.2 Lease. To use its best efforts to negotiate with the current landlord of the
Casino’s premises a new lease for such premises. The successful negotiation of
such lease shall be a condition precedent to Seller’s obligations to close
hereunder.
7.3 Employment Generally; Worker Adjustment and Retraining Notification Act
(“WARN Act”).
7.3.1 Seller currently employs approximately 150 full, part time, and seasonal
employees at the Casino.
7.3.2 Buyer agrees to offer employment to at least seventy percent (70%) of
Seller’s full-time employees for a period of not less than ninety (90) days
following Closing, upon terms and conditions that will not constitute a
“constructive discharge” within the meaning of the WARN Act, it being the
express intention of the parties that Seller will have no requirement or
obligation to give any notices which otherwise may be required pursuant to the
terms of the WARN Act.
7.3.3 Seller’s agreement to consummate the transactions contemplated by this
Agreement is in full reliance upon Buyer’s obligation to offer employment to a
sufficient number of Seller’ employees at the Casino, to eliminate any
requirement to give WARN Act notices to Seller’s employees.

 

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7.4 Employment Contracts.
7.4.1 Buyer acknowledges that four (4) employees of Seller have existing
employment agreement, which employment agreements have been provided to Buyer.
7.4.2 Seller and Buyer agree and understand that Buyer assumes no liability
under or pursuant to any existing employment agreement which Seller has entered
into with its employees. Seller shall not, and shall have no obligation to,
assign said existing employment agreements to Buyer.
7.5 Further Assurances. On the Closing Date the Buyer shall execute, if
appropriate, and deliver to the Seller such instruments, documents, assignments
and assumptions of liability as may be reasonably necessary, in the Seller’s
opinion, to affect a transfer of the Assets to the Buyer and the assumption of
liability required to be assumed by Buyer hereunder..
7.6 Buyer shall assume the assumed liabilities only to the extent arising or
accruing from and after the Closing Date, and Buyer shall have no duty or
obligation whatsoever with respect to any duties or obligations of Seller
arising or accruing before the Closing Date (all of which shall be the sole
responsibility and liability of Seller).
7.7 From time to time following the Closing, Buyer shall grant to Seller, and to
Seller’s representatives and agents, access to all books and records of the
Business transferred to Buyer hereunder, and the right to make copies and
extracts thereof, all at Seller’s sole expense,
For the purpose of enabling Seller to make any post-closing reports or filings
it may be required to that it may desire to make including without limitation,
tax returns and reports and reports to regulatory agencies. For that purpose,
Buyer agrees to retain all such books and records for a period consistent with
Seller’s records retention policies in place on the date hereof. In addition,
Buyer agrees to make available to Seller the services of Seller’s current
Controller to prepare or assist in preparing such reports and filings so long as
said Controller remains in the employ of Buyer and provided her assistance can
be made available without disruption to Buyer’s business. Seller agrees that it
shall reimburse Buyer for a proportionate share of the Controller’s compensation
and benefits and other related costs for the time during which she is rendering
the services herein contemplated.
ARTICLE 8
COVENANTS AND AGREEMENTS
8.1 Cooperation. Each of the parties hereto shall use his, her or its
commercially reasonable efforts and good faith to perform and fulfill all
conditions and obligations to be fulfilled or performed hereunder.
8.2 Taxes. Seller shall be responsible for the payment of and will indemnify and
hold the Buyer harmless against all taxes due or assessed which related to the
operations of the business for all periods up to and including the Closing Date.
Buyer shall be responsible for the payment of and will indemnify and hold the
Seller harmless against all taxes due or assessed which relate to the operations
of the business for all periods following the Closing Date.

 

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ARTICLE 9
SURVIVAL; INDEMNIFICATION
9.1 Survival. The representations, warranties and indemnities set forth in or
made pursuant to this Agreement shall remain operative and shall survive for a
period of one (1) year from the Closing Date (“Survival Period”) and shall not
be merged therein, regardless of any investigation by or on behalf of any party.
9.2 Indemnification by Seller. From and after Closing, Seller will indemnify and
hold harmless Buyer and each of its respective affiliates, directors, officers,
employees, attorneys, agents, representatives, successors and assigns in respect
of any and all claims, losses, damages, liabilities, penalties, interest, costs
and expenses (including reasonable attorneys’, accountants’ and consultants’
fees and expenses, including and such expenses incurred in connection with
investigating, defending against or settling any such claims) (collectively,
“Losses”) reasonably incurred by Buyer in connection with, or resulting from,
any or all of the following:
9.2.1 Any breach of any representation or warranty made by Seller in this
Agreement, to the extent Buyer has notified Seller in writing of any such
purported breach within the Survival Period; and
9.2.2 Any breach in the performance of any covenant, agreement or obligation of
Seller contained in this Agreement.
9.3 Indemnification by Buyer. From and after the Closing, Buyer will indemnify
and hold harmless Seller and each of its respective affiliates, directors,
officers, employees, attorneys, agents, representatives, successors and assigns
in respect of any and all claims, losses, damages, liabilities (specifically
including all liabilities for failure to give WARN Act notices), penalties,
interest, costs and expenses (including reasonable attorneys’, accountants’ and
consultants’ fees and expenses, including and such expenses incurred in
connection with investigating, defending against or settling any such claims)
(collectively, “Losses”) reasonably incurred by Seller in connection with, or
resulting from, any or all of the following:
9.3.1 Any breach of any representation or warranty made by Buyers in this
Agreement; and
9.3.2 Any breach in the performance of any covenant, agreement or obligation of
Buyers contained in this Agreement to the extent Seller has notified Buyer of
any purported breach within the Survival Period.

 

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ARTICLE 10
MISCELLANEOUS
10.1 Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior written or oral agreements and understandings
relating to the subject matter hereof. No statement, representation, warranty,
covenant or agreement of any kind not expressly set forth in this document shall
affect, or be used to interpret, change or restrict, the express terms and
provisions of this Agreement.
10.2 Modifications. The terms and provisions of this Agreement may be modified
or amended only by a written agreement executed by all parties signatory hereto.
10.3 Assignment. Neither this Agreement nor any right hereunder may be assigned
by any of the parties hereto without the prior written consent of the other
parties; provided, however, that the Buyer may assign the rights under this
Agreement including without limitation the right to receive the Assets to a
corporation, partnership, limited liability company or other similar entity
without the express written approval of the Seller. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, personal representatives, successors and permitted assigns.
10.4 Termination. In the event that either party terminates this Agreement,
written notice thereof shall forthwith be given to the other party or Parties,
and the transactions contemplated hereby shall be terminated without further
action by any party. If the transactions are terminated as provided herein:
(a) Buyer and Seller shall return all documents, copies and other material
received from any other party relating to the transactions contemplated hereby,
whether so obtained before or after the execution hereof, to the party from whom
such documents, copies or materials were received;
(b) All confidential information received by Buyer and Seller with respect to
Buyer or Seller or the Business shall be treated as confidential notwithstanding
the termination of this Agreement; and
(c) This Agreement shall become void and of no further force and affect.
10.5 Notices. All notices, demands, requests, or other communications which may
be or are required to be given or made by any party to any other party pursuant
to this Agreement shall be in writing and shall be hand delivered or delivered
by overnight air courier and addressed or faxed as follows:

     
10.5.1 If to Seller:
   
 
  HCC CORPORATION,
 
  a Nevada corporation, d/b/a
 
  GRAND LODGE CASINO
 
  c/o HGMI Gaming, Inc.
 
  71 S. Wacker Drive
 
  10th Floor
 
  Chicago, IL 60606

 

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  with a required copy to:
 
   
 
  Michael J. Melarkey, Esq.
 
  Avansino, Melarkey, Knobel, Mulligan & McKenzie
 
  4795 Caughlin Parkway, Suite 100
 
  Reno, NV 89519
 
  Tel.: 775-333-0300
 
  Fax: 775-333-0305
10.5.2 If to Buyer:
   
 
  GAMING ENTERTAINMENT (NEVADA),
 
  A Nevada Limited Liability Company
 
  c/o FULL HOUSE RESORTS, INC
 
  4670 So. Fort Apache Road, Suite 190
 
  Las Vegas, NV 89147
 
  Attn: Andre M. Hilliou, Chairman and CEO

or such other address as the addressee may indicate by written notice to the
other parties.
Each notice, demand, delivery, request or communication which shall be given or
made in the manner described above shall be deemed sufficiently given or made
for all purposes at such time as it is delivered to the addressee (with the
delivery receipt or the affidavit of messenger being deemed conclusive but not
exclusive evidence of such delivery) or at such time as delivery is refused by
the addressee upon presentation.
10.6 Governing Law. This Agreement and the rights and obligations of the parties
hereunder shall be construed in accordance with and governed by the internal
laws of the State of Nevada, without giving effect to the conflict of law
principles thereof.
10.7 Severability. In the event that a court of competent jurisdiction or
arbitral panel shall finally determine that any provision, or any portion as
contained in this Agreement shall be void or unenforceable in any respect, then
such provision shall be deemed limited to the extent that such is determined to
be enforceable and as to limited shall remain in full force and effect. To the
extent that such determination shall finally decide any such provision to be
wholly unenforceable, the remaining provisions of this Agreement shall
nevertheless remain in full force and effect as though such provision was
omitted in its entirely.
10.8 Interpretation. The parties acknowledge and agree that (i) the rules of
construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement and
(ii) the terms and provisions of this Agreement shall be construed fairly as to
all parties hereto and not in favor of or against any party regardless of which
party was generally responsible for the preparation of this Agreement.
10.9 Headings and Captions. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only and shall
in no way modify or affect or be considered in construing or interpreting the
meaning or construction of any of the terms or provisions hereof.

 

12

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10.10 Reliance. The parties hereto agree that notwithstanding any right of any
party to this Agreement to investigate the affairs of any other party to this
Agreement, the party having such right to investigate shall have the right to
rely fully upon the representations and warranties of the other party expressly
contained herein, whether or not such investigation was conducted.
10.11 Fees and Expenses. Costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be borne and paid as
follows:
10.11.1 All documentary stamp or transfer taxes and fees and recording fees
relating to the purchase of the Assets shall be borne and paid by Seller, and
all sales use or similar taxes, if any, relating to the purchase of the Assets
shall be paid by the Buyer.
10.11.2 The Seller shall have paid all required state unemployment taxes through
the date of Closing.
10.11.3 Except as otherwise specifically provided in this Agreement, each party
shall bear its own costs and expenses arising out of the negotiation, execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated herein including, without limitation, legal and
accounting fees and expenses, whether or not the transactions contemplated
hereby are consummated.
10.12 Counterparts. This Agreement may be executed in one or more counterparts
and by different parties hereto on separate counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
10.13 Representation. Avansino, Melarkey, Knobel, Mulligan & McKenzie (the “Law
Firm”) has prepared this document on behalf of and has represented the Seller
and does not represent Buyer with respect to this document or any agreement
between the Seller and Buyer. The Law Firm advises Buyer to consult with its own
independent legal counsel and tax advisors as to the matters of this Agreement.
The Law firm has made no representations to Buyer as to the federal or state tax
consequences of the transactions contemplated under this Agreement.
10.14 Arbitration. Any controversy or claim arising out of or relating to this
Agreement or the making, performance or interpretation thereof shall be settled
by arbitration pursuant to JAMS, Streamlined Arbitration Rules, using a single
arbitrator in Reno, Nevada and judgment on the arbitration award may be entered
in any court having jurisdiction over the subject matter of the controversy. In
connection with any such arbitration, each Party shall bear the cost of its own
counsel, and all other costs associated with the arbitration shall be borne as
awarded by the arbitrator. Neither Party shall have the right to discovery in
connection with such arbitration except as otherwise agreed by the Parties or as
determined by the arbitrator in light of the circumstances of the case. In any
arbitration, the arbitrator shall be bound by the terms of this Agreement and
applicable provisions of law. The cost of any verbatim transcript of the
arbitration proceedings shall be borne by the Party requesting the same or if
requested by both Parties shall be divided equally. Transcripts of arbitration
proceedings shall be made available to the Party or Parties requesting verbatim
transcripts and to the arbitrator.

 

13

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IN WITNESS WHEREOF the Buyer and the Seller have executed this Agreement all as
of the Effective Date.

                  BUYER:   SELLER:    
 
                GAMING ENTERTAINMENT (NEVADA),   HCC CORPORATION, a Nevada
corporation,     A Nevada Limited Liability Company   d/b/a GRAND LODGE CASINO  
 
 
               
By:
  /s/ Mark J. Miller   By:   /s/ Peter M. Liguori    
 
 
 
     
 
   
Its:
  Manager   Its:   President    

 

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SCHEDULE A
Gaming and Tangible Personal Property

1.  
Fair market value in-place and in-use appraisal, dated April 29, 2011 — Value of
assets $599,580 as of March 23, 2011 (previously provided to buyer).

2.  
Additions since appraisal, effective date of March 23, 2011 through May 31, 2011
is $50,532.99 (see attached Capital Expenditure Monthly Report as of May 31,
2011 — Exhibit A-1).

3.  
Retirements, trade-ins, sale or deletion of assets included in items 1 or 2
above as of May 31, 2011 is 0.

 

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EXHIBIT A
Capital Equipment
Appraiser’s Note: The furniture, fixtures and equipment (FF&E) of the Hyatt
Grand Lodge Casino, NV 89119, appraised and viewed, appears to be in mainly Good
Condition, except as noted, and shows good maintenance and care. While most of
the FF&E is older, it has been well maintained (except as noted) and in good
repair/condition.
Appraiser’s Note: As a large number of items in this appraisal are electronic
(slots, computers, servers, IT systems, printers, televisions, monitors,
surveillance equipment, cameras, phone system, etc.) it is important to
understand that nearly all electronic-based equipment will tend to be out-dated
in a relatively short period of time. While the equipment will still be very
useable and perform as intended, the pace of improvements in new equipment is
very fast and tends to be less costly than the previous model or generation.
Thus, the Fair Market Value (FMV) of many electronics drops sharply after six to
twelve months. Electronics that are more than one or two years old are often
relatively obsolete, even though their useful life may be many years, and the
FMV may only be a small percentage of the original cost.

                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 1 Pic 11
  Poker Tables       Very good quality       N/A   Good   Four @ $1000 Includes
cover, tray and chips   $ 4000  
Item 2 Pic 13
  Podium               N/A   Good       $ 70  
Item 3 Pic 14-162
  Small Round Wood Tables               N/A   Good   Two @ $50   $ 100  
Item 4 Pic 15-46-90-168
  Card/Chip Storage Cabinet       Very well built       N/A   Good   Five @ $200
  $ 1000  
Item 5 Pic 16
  Beverage Bar               N/A   Good       $ 300  
Item 6 Pic 18-19
  LCD Screens   4 – Toshiba, 1 Vizio, 1 N/A           N/A   Good   Six @ $350  
$ 2100  
Item 7 Pic 20
  Literature Rack               N/A   Good       $ 125  

 

16

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value    
 
             
Item 8 Pic 21
  Table & Four Chair Set               N/A   Good   Rough wood style   $ 250  
Item 9 Pic 22
  24” Chairs       Wrap-around style Upholstered       N/A   Good   105 @ $60  
$ 6300  
Item 10 Pic 23
  24” Chairs       Straight back style Upholstered       N/A   Good   93 @ $50  
$ 4650  
Item 11 Pic 24
  19” Chairs       Wrap around style Upholstered       N/A   Good   56 @ $50   $
2800  
Item 12 Pic 25
  19” Chairs       Straight back style Upholstered       N/A   Good   46 @ $40  
$ 1840  
Item 13 Pic 26-44
  Black Jack Tables       H - Style. Very heavy duty       N/A   Good   18 (3 in
storage) @ $700. Quality   $ 12,600     Appraiser’s Note: These B-J tables are
older but of good quality. If the casino operation were to be sold there would
be an expense to change the layouts to reflect the new ownership name, possibly
$200 - $300 per table. FMV includes tray and signage but NOT shufflers.  
Item 14 Pic 27-28
  Roulette Tables       Good quality tables       N/A   Good   Two tables.
Includes roulette wheel and electronic read out.   $ 17,000     Appraiser’s
Note: These roulette tables are older but of good quality. If the casino
operation were to be sold there would be an expense to change the layouts to
reflect the new ownership name, possibly $200 - $300 per table. An electronic
‘board’ can cost $18,000.  
Item 15 Pic 29-30
  Automatic Shufflers   ShuffleMaster           N/A   Good   Seven @ $5500. Up
to 10 decks handled   $ 38,500     Appraiser’s Note: ShuffleMaster is the
preferred shuffler in the industry. For many years the company would not sell
its products but required them to be leased. Several years ago the company was
selling their products. However, unless the casino has a qualified technician a
service contract with ShuffleMaster would probably be necessary. The market is
very tight on used ShuffleMaster shufflers.  
Item 16 Pic 31
  Pit Podiums               N/A   Good   Three @ $400   $ 1200  
Item 17 Pic 33-52-93-94-117-150
  Printers   Lexmark   Pin-Fed       N/A   Good   Eight @ $85. Specialized use.
Limited market.   $ 680  

 

17

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                                                  Model       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 18 Pic 34-51
  Card Embossers               N/A   Good   Four @ $350   $ 1400  
Item 19 Pic 34
  Time Stamp   Latham           N/A   Good   Three @ $125   $ 375  
Item 20 Pic 35
  LCD TVs               N/A   Good   Four @ $350   $ 1400  
Item 21 Pic 36
  LCD TVs               N/A   Good   Two @ $350   $ 700  
Item 22 Pic 36
  Digital Signage               N/A   Good       $ 200  
Item 23 Pic 37
  Digital Signage               N/A   Good       $ 200  
Item 24 Pic 42
  Bill Changer/Ticket Redemption   CasinoXchange           N/A   Good       $
6500  
Item 25 Pic 43
  Dice Tables               N/A   Good   Two @ $2000   $ 4000  
 
                                    Appraiser’s Note: These dice tables are
older but of good quality. If the casino operation were to be sold there would
be an expense to change the layouts to reflect the new ownership name, possibly
$300 - $400 per table.  
Item 26 Pic 45
  Automatic Saufflers   ShufffleMaster   MD2       N/A   Good   6 @ $4000 One to
two decks   $ 24000  
Item 27 Pic 48
  Digital Signage               N/A   Good       $ 200  
Item 28 Pic 50-91
  AIO Printer   HP           N/A   Good   Two @ $25 Electronics   $ 50  
Item 29 Pic 53
  PC w/Flat Monitors   Various           N/A   Good   33 @ $120 Electronics   $
3960  
Item 30 Pic 56
  Metal Shelving               N/A   Good   1-6’ and 1 4’ Each $25   $ 50  

 

18

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 31 Pic 49-57-75-123-131-133-134-135-144-158-184-196-197-
  Various Chairs. Mainly
Secretary-type               N/A   Good   17 @ $35

Very large quantity of good used chairs available   $ 595  
Item 32 Pic 70-80-83-101-127-151-155-158-159-164-184-185-203-209-
  Various Chairs. Desk and Executive-type               N/A   Good   15 @ $65  
$ 975  
Item 33 Pic 58
  Hydraulic Slot Track               N/A   Good       $ 325  
Item 34 Pic 59
  Slot Dolly               N/A   Good       $ 125  
Item 35 Pic 60
  Dolly               N/A   Good       $ 86  
Item 36 Pic 61
  Small Ladder               N/A   Good       $ 15  
Item 37 Pic 62
  Hand-Dollies               N/A   Good   Two @ $20   $ 40  
Item 38 Pic 55
  Metal Storage cabinets               N/A   Good   Two @ $60   $ 120  
Item 39 Pic 63
  SDCU Rack               N/A   Good       $ 85  

 

19

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 40 Pic 63-64
  SDCUs               N/A   Good   16 @ $200   $ 3200  
Item 41 Pic 66
  File Cabinet       3-Drawer       N/A   Good       $ 85  
Item 42 Pic 67-105-1219-135-210
  AIO Printer   HP   All-In-One       N/A   Good   Five @ $90   $ 450  
Item 43 Pic 69
  Metal Hanging Book Case               N/A   Good       $ 100  
Item 44 Pic 70
  Corner Desk               N/A   Good       $ 170  
Item 45 Pic 72-96-115-121-135-196-197-199- 206-
  Calculators   Monroe           N/A   Good   13 @ $20   $ 260  
Item 46 Pic 73
  Safety Storage       Heavy duty hazardous storage       N/A   Good       $ 250
 
Item 47 Pic 74
  Compressor       Small portable       N/A   Good       $ 50  
Item 48 Pic 76
  Fastener Case w/Small Fasteners               N/A   Good       $ 100  
Item 49 Pic 77
  Bench Grinder   Dayton           N/A   Good       $ 80  
Item 50 Pic 78
  Work Bench, Parts, Tools, etc.       The parts and tools of the shop       N/A
  Good       $ 400  
Item 51 Pic 79
  Drill Press   Craftsman   15 1/2 Inch       N/A   Good       $ 160  

 

20

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 52 Pic 81-81
  Wheel Chairs               N/A   Good   Two @ $135   $ 270  
Item 53 Pic 83
  Corner Desk       Security Office       N/A   Good       $ 50  
Item 54 Pic 84
  Metal Cabinet               N/A   Good       $ 25  
Item 55 Pic 85
  File Cabinet       4-Drawer Legal File, security office       N/A   Good      
$ 100  
Item 56 Pic 86-89
  Free-Standing Desk Cubicle               N/A   Good   Very good quality   $
1200  
Item 57 Pic 97
  Slot Desk/Cubicle               N/A   Good   Very good quality   $ 1500  
Item 58 Pic 96
  Defibulator   Zoll   AEC Plus       Older   Good       $ 160  
Item 59 Pic 99-112-124-145-152-
  Laser Printer   HP           N/A   Good   Five @ $135   $ 775  
Item 60 Pic 100-101
  Corner Desk w/Two Hutches               N/A   Good       $ 400  
Item 61 Pic 104
  Typewriter   Brother           N/A   Good       $ 20  
Item 62 Pic 106
  Lateral File   2-Drawer           N/A   Good       $ 100  
Item 63 Pic 107
  Scanner   Canon   CD-4050       N/A   Good       $ 125  
Item 64 Pie 108
  Scanner   Cummins   Image Formula Scanfont 300P       Older   Good       $ 75
 

 

21

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 65 Pic 109
  Shredder   Fellows   S8-85C       N/A   Good       $ 25  
Item 66 Pic 110
  Bill Counter   Cummins   Jet Scan       N/A   Good   Double Trays   $ 1200  
Item 67 Pic 111
  Coin Sorter   Cummins   Jet Sort       N/A   Older       $ 350  
Item 69 Pic 113
  Credit Card Machine               N/A   Good       $ 100  
Item 70 Pic 113
  Time Stamp   Rapidprint           N/A   Good       $ 40  
Item 71 Pic 116
  Bill Counter   Cummins   Jet Scan       N/A   Good   Single Tray   $ 500  
Item 72 Pic 119
  Ticket Dispenser               N/A   Good       $ 110  
Item 73 Pic 120-121
  Desk w/Overhead               N/A   Good       $ 200  
Item 74 Pic 122
  Lateral file       2-Drawer       N/A   Good       $ 100  
Item 75 Pic 125-131
  Lateral File       4-Drawer       N/A   Good   Three @ $160   $ 480  
Item 76 Pic 128
  Desk w/Credenza       Good quality wood       N/A   Good       $ 750  
Item 77 Pic 130
  Shredder   Fellowes           N/A   Good       $ 25  
Item 78 Pic 132
  Plasma TV   NEC           N/A   Good       $ 350  

 

22

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 79 Pic 133
  Bookcase               N/A   Good       $ 160  
Item 80 Pic 134-135
  Desk       Desk w/Leg and overhanging bookcase       N/A   Good       $ 250  
Item 81 Pic 138
  File Cabinet       3-Drawer       N/A   Good       $ 85  
Item 82 Pic 139
  Data Card Machine   Ultragrafix   285       N/A   Poor   Not in good working
order   Scrap
Item 83 Pic 139
  Metal Storage Cabinets               N/A   Good   Two @ $80   $ 160  
Item 84 Pic 140
  Hanging Storage       Metal       N/A   Good   Two @ $45   $ 90  
Item 85 Pic 141-161-163-194-201-202
  Lateral Files       4-Drawer       N/A   Good   Six @ $160   $ 960  
Item 86 Pic 142
  Automatic Shuffler   ShuffleMaster   ‘Carnival Game Shuffler’       N/A   Good
  3 @ $5000   $ 15,000  
Item 87 Pic 143
  Kitchen               N/A   Good   Microwave $35 Small Frig $25 Coffee maker
and Water Heater $10   $ 70  
Item 88 Pic 143
  Table               N/A   Fair       $ 20  
Item 89 Pic 144
  Corner Desk Cubicles       W/Hanging Bookcase and under desk storage       N/A
  Good   Three @ $350   $ 1050  
Item 90 Pic 140
  Automatic Shufflers   ShuffleMaster   MD1       N/A   Good   Two @ $4000   $
8000  

 

23

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 91 Pic 145
  Laser Printer   HP    3015       Older   Fair       $ 65  
Item 92 Pic 146
  Metal Cabinet       Large 2-door upright       N/A   Good       $ 125  
Item 93 Pic 147
  Lounge Chairs       Leather VIP Office       N/A   Good   Two @ $200   $ 400  
Item 94 Pic 148
  Desk w/Credenza       High Quality VIP Office       N/A   Good   Two @ $650  
$ 1300  
Item 95 Pic 149
  Hanging Storage Cabinet       High Quality VIP Office       N/A   Good   Two @
$175   $ 350  
Item 96 Pic 149
  LCD TV   Vizio   VIP Office       N/A   Good       $ 350  
Item 97 Pic 153
  Lateral File       Good quality wood. 2-Drawer. Marketing Ofc.       N/A  
Good       $ 180  
Item 98 Pic 153
  File Cabinet       Good quality wood. 2-Drawer. Marketing Ofc.       N/A  
Good       $ 100  
Item 99 Pic 154-155-157
  Desk w/Credenza and Hutch       Good quality wood. 2-Drawer. Marketing Ofc.  
    N/A   Good       $ 700  
Item 100 Pic 156-205
  Side Chairs       Good quality wood. 2-Drawer. Marketing Ofc.       N/A   Good
  Four @ $   $ 130  
Item 101 Pic 158-159-169
  Cubicles               N/A   Good   Five @ $   $ 1750  
Item 102 Pic 161
  Metal Storage Cabinet               N/A   Good       $ 40  
Item 103 Pic 162
  Chairs       Good Quality, used as side chairs       N/A   Good   Two @ $   $
150  

 

24

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 104 Pic 165
  Roulette Chips       Extras /replacements       N/A   Good       $ 150  
Item 105 Pic 165
  Metal Shelving       Heavy Duty 6’       N/A   Good   Three @ $40   $ 120  
Item 106 Pic 167
  Slot Dolly               N/A   Good       $ 175  
 
              Appraiser’s Note: The following items, Item numbers 107 through
131, are all surveillance equipment. It should be noted that this is a FMV
In-Place In-Use Appraisal and therefore the items have a value when considered
within the scope of this appraisal. Most of the surveillance equipment was
purchased used. However, based on the age, condition and removal challenges,
these items would have a much lesser value if offered for sale in Fair Market
Value offering. Much of th e existing equipment can be purchased new, with
current technology, at less than what the purchase price used was (example:
Vicon PTZ [pan, tilt zoom camera] is advertised currently new at $1556.00, the
used price was $2100).
 
             
Item 107 Pic 183
  Alarm   Vicon   Vicon Alarm Control Line Feed       Older   Good       $ 400  
Item 108
  Alarm Control   Symplix   Symplix Panic Alarm Control       Older   Good      
$ 125  
Item 109
  Cameras       Fixed w/lens in casino       Most older   Fair to Good   80
Units are analog only. $50 ea. 20 Units are analog and digital, $100 ea.   $
6000  
Item 110
  Covert Cameras       Covert       N/A   Good   Two @ $175   $ 350  
Item 111 Pic 189
  Central manager   Aventura   Aventura Centeral Manager   SuperMicro Server
#5014C-T/B/1   Older   Good       $ 7500  
Item 112
  Computers w/Screens               Older   Good   12 @ $100   $ 1200  
Item 113
  Distribution Amplifiers               Older   N/A   13 @ $300   $ 3900  
Item 114 Pic 186
  Control Desk W/Credenza               Older   Fair       $ 2500  

 

25

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 115 Pic 187
  Desk               Older   Fair       $ 125  
Item 116 Pic 183
  Control Lines   Vicon   Vicon V1400X Line Control       Older   Good   5 @
$200   $ 1000  
Item 117 Pic 189
  Digital Recorders   Aventura   SuperMicro #P8SCT. 8TB storage — H.264      
Older   Good   9 @ $650   $ 5400  
Item 118 Pic 188
  Digital recorder   Sanyo   Single Digital Recorder       Older   Good   2 @
$700   $ 1400  
Item 119
  Digital Recorder   Sanyo   Quad Digital Recorders       Older   Good   2 @
$700   $ 1400  
Item 120 Pic 190
  Key pads   Vicon   V1400X       Older   Good   7 @ $50   $ 350  
Item 121 Pic 183
  Port   Logitec   Logitec 8-port VM       Older   Good       $ 300  
Item 122 Pic 183
  Matrox   Vicon   Vicon Matrox Nova Power Series Matrix-66 Power plus version
0.1.5       Over 11 Years   Good   Current technology would be preferred by any
potential buyer.   $ 6500  
Item 123 Pic 191
  Monitors       Security Monitors       Older   Good   16 @ $50   $ 800  
Item 124 Pic 187
  3 Com       3 Com       N/A   Good   2 @ $225   $ 450  
Item 125 Pic 191
  Power Boxes       Power control distribution boxes       N/A   Older   10 @
$50   $ 500  
Item 126 Pic 193
  Printer   HP           Older   Good       $ 25  

 

26

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 127
  PTZ Camera   Vicon - 36, Pelco - 2   Pan, tilt, zoom cameras       N/A  
Mostly Older   20 Analog, $300 ea. 18 Digital $1000 ea.   $ 24,000  
Item 128
  Radio   Kenwood           N/A   Older       $ 175  
Item 129
  Audio Converters               N/A   Older   3 @ $100   $ 300  
Item 130
  UPS   BPI and M   1400 950W Power backup towers       N/A   Older   6 @ $250  
$ 1500  
Item 131
  UPS   Cyber Pro   1400W       N/A   Older   2 @ $400   $ 800  
Item 132 Pic 195
  Digital Display Signage               N/A   Good       $ 200  
Item 133 Pic 196
  Shredder       Large business usage       N/A   Good       $ 75  
Item 134 Pic 198
  Metal Cabinet       Large Metal Cabinet       N/A   Good       $ 100  
Item 135 Pic 200
  Postage Machine   Pitney Bowes   All inclusive       N/A   Good       $ 150  
Item l36 Pic 203
  Desk w/Hutch       Good quality       N/A   Good       $ 700  
Item 137 Pic 205
  Lateral Files       Two 2-drawer lateral files       Older   Fair   Two @ $  
$ 150  
Item 138 Pic 208-209-210-211
  Executive Desk       Good quality w/leg       Older   Good       $ 450  
Item 139 Pic 208
  Table       Wood       Older   Fair       $ 75  

 

27

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 140 Pic 212
  TV Cabinet       Wood       Older   Older       $ 100  
Item 141 Pic 212
  Bookcase       Wood       Older   Good   6’   $ 100  
Item 142 Pic 213-214
  Side Chairs       Wood, upholstered       Older   Good   Two @ $50   $ 100  
Item 143 Pic 214
  End Table       Good Quality       Older   Fair       $ 50  
Item 144 Pic
  Cheques       High Quality       Older   Fair to Good   Approximately 35,000  
$ 31,500  
 
              Appraiser’s Note: Casino cheques can be generic or ‘branded’. The
cheques of this casino are branded and high quality. The appraiser was not able
to find a manufacturer who could duplicate this style and quality of cheques. A
high quality cheque (Paulson) costs 90 to 95 cents each. If THIS casino were to
be sold and operate under a new name the value of the existing cheques would be
minimal, as they would necessarily need to be replaced. Nevada Gaming Law
requires a casino that is no longer going to use a cheque, or cheques, to
advertise to the public that it will redeem outstanding cheques. The company
must allow a reasonable time and have reserves to honor cheque redemption. Thus,
if THIS casino were to be sold or operated under another name, the value of the
cheques would be ZERO, and, of course, the new operator would have to purchase
new cheques. If the casino was to change owners and/or operators the existing
cheques may, or may not, have a collectable value at some point in time.
 
             
Item 145 Pic 216
  Security Key Box               N/A   Good       $ 900  
Item 146 Pic 216
  Security System       BioMetric       N/A   Good       $ 3500  
Item 147 Pic 217
  Cabinet       Cabinet for drop boxes       N/A   Good       $ 150  
Item 148 Pic 222
  Drop Boxes       Drop boxes for table games       N/A   Good   48 @ $40   $
1920  
Item 149 Pic 216
  Transport Cart       Cart to transport drop boxes       N/A   Good       $ 350
 
Item 150 Pic 219
  Cabinet       Cabinet for cash boxes (slots)       N/A   Good       $ 200  

 

28

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 151
  Cash Boxes       Cash boxes for slots       N/A   Good   518 @ $60   $ 31,080
 
Item 152 Pic 220
  Coin Sorter   Cummins   Cummins Jet Scan       Older   Good   Great machine
... little demand   $ 3000  
Item 153 Pic 220
  Bill Counter   Cummins           N/A   Good   Single Tray   $ 350  
Item 154 Pic 220
  Table       HD Table       N/A   Good       $ 125  
Item 155 Pic 223
  Digital Signage               N/A   Good       $ 200  
Item 156 Pic 224-225
  Chairs       These chairs are a combination of extra chairs and damaged chairs
      Older   Fair to Poor   70 @ $10   $ 700  
Item 157 Pic 226-227
  Slots   IGT   $2000       Older   Fair   Used for tournament play. No TITO.
Eight @ $300   $ 2400  
Item 158 Pic 229
  Underlayment               N/A   Good   Underlayment for table games. Partial
roll.   $ 150  
Item 159 Pic 232
  Coin sorter   Cummins   Jet Sort       Older   Fair   Older and smaller unit  
$ 150  
Item 160 Pic 233
  Big Six Table               Older   Fair   Big Six game   $ 350  
Item 161
  Slot Machine   IGT   Bally EM       Older   N/A   In storage   $ 300  
 
              Appraiser’s Note: The following items from Item 162 to 196 are
slot machines. Slot machines are of various models. Each company determines the
games available and has patent rights to their games. Used slots are readily
available at reasonable prices for older models. Newer models are available and,
depending upon their popularity, are priced accordingly. IGT’s GameKing has
remained a very popular model for many years and still holds its value well even
if it as much as 10 years old. The national economy has had a very negative
effect on the Gaming Industry and gaming companies have curtailed new purchases
dramatically. Some of the pictures attached to this appraisal are of very
similar models listed but may not be from the Grand Lodge Casino and are meant
to give the reader a reliable example of the model listed. Values include slot
stands when applicable.

 

29

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 162 Pic A-1
  Slot   Aristocrat   MAV500, MKV1       2006   Good   Three @ $800   $ 2400  
Item 163 Pic A-1
  Slot   Aristocrat   MAV500       2005   Good   Four @ $800   $ 3200  
Item 164 Pic 1-2-182
  Slot   Aristocrat   Viridian       2009   Good   Three @ $2100   $ 6300  
Item 165 Pic A-2
  Slot   Atronic   Cashline       2004   Good   Three @ $700   $ 2100  
Item 166 Pic 169-170
  Slot   Bally   GameMaker C9-l       2006   Good   Four @ $1500   $ 6000  
Item 167 Pic 171
  Slot   Bally   S9000C       2008   Good   Three @ $1650   $ 4950  
Item 168 Pic A-3
  Slot   Bally   M9000       2005   Good   Four @ $950   $ 3800  
Item 169 Pic
  Slot   Bally   S9000       2006   Good   Three @ $900   $ 2700  
Item 170 Pic 172
  Slot   Bally   V32       2010   Good   Four @ $2250   $ 9000  
Item 171 Pic A-5
  Slot   IGT   Game King       2005   Good   Two @ $1400   $ 2800  
Item 172 Pic A-5
  Slot   IGT   Game King       2004   Good   35 @ $1350   $ 47,250  
Item 173 Pic A-5
  Slot   IGT   Game King       2002   Good   8 @ $1250   $ 10,000  
Item 174 Pic A-5
  Slot   IGT   Game King       2001   Good   12 @ $1200   $ 14,400  

 

30

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 175 Pic A-5
  Slot   IGT   Game King       2000   Good   9 @ $1000   $ 9000  
Item 176 Pic A-5
  Slot   IGT   Game King       1999   Good   12 @ $900   $ 10,800  
Item 177 Pic A-5
  Slot   IGT   Game King       1998   Good   10 @ $850   $ 8,500  
Item 178 Pic 181
  Slot   IGT   S2000       2007   Good   4 @ $950   $ 3,800  
Item 179
  Slot   IGT   S2000       2004   Good   35 @ $800   $ 28,000  
Item 180
  Slot   IGT   S2000       2002   Good   3 @ $750   $ 2,250  
Item 181
  Slot   IGT   S2000       2001   Good       $ 750  
Item 182
  Slot   IGT   S2000       2000   Good   3 @ $700   $ 2100  
Item 183
  Slot   IGT   Game King Bar       2004   Good   31 @ $800   $ 24,800  
Item 184
  Slot   IGT   Game King Bar       2002   Good   4 @ $800   $ 3200  
Item 185 Pic 174
  Slot   IGT   Trimline AVD       2007   Good   5 @ $1600   $ 8000  
Item l86 Pic 177
  Slot   IGT   AVP Slant       2009   Good   2 @ $1900   $ 3800  
Item 187
  Slot   IGT   AW Slant       2008   Good   4 @ $1900   $ 7600  

 

31

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                                                  Model/       Year/          
Estimated Fair   Item #   Type   Manufacturer   Description   Serial/ VIN No.  
Age   Condition   Comment   Market Value  
 
             
Item 188 Pic 173
  Slot   IGT   SMLD, S-AVP       2009   Good   3 @ $1900   $ 5700  
Item 189
  Slot   Konami   Advantage       2004   Good   3 @ $850   $ 2550  
Item 190 Pic 178
  Slot   Konami   Advantage +       2007   Good   3 @ $1100   $ 3300  
Item 191 Pic 175
  Slot   Konami   K2V 2.0       2009   Good   6 @ $1350   $ 8100  
Item 192 Pic 179
  Slot   Konami   KGP 2.0       2009   Good   2 @ $1000   $ 2000  
Item 193
  Slot   WMS   BBS Slant       2005   Good   4 @ $850   $ 3400  
Item 194
  Slot   WMS   BBU Upright       2005   Good   4 @ $850   $ 3400  
Item 195
  Slot   WMS   BBU Upright       2004   Good   2 @ $850   $ 1700  
Item 196 Pic 176
  Slot   WMS   BBU2       2010   Good   4 @ $2500   $ 10,000  
 
              Appraiser’s Note: The appraiser would like to re-emphasize that
this is a Fair Market Value In-Place In-Use valuation as opposed to a Fair
Market Value appraisal. This is especially important regarding the values
established for the slot machines. There is a real additional value for a piece
of equipment that is in-place and in-use as opposed to having that same item
placed on the market for sale. In this case there is currently a ‘glut’ of slot
machines on the market. Thus, if these items were to be offered for sale NOT
in-place and in-use the values would be substantially less, perhaps 25% to as
much as 50% less (on older and/or ‘dated’ machines/electronics) than the Fair
Market Value In-Place In-Use values.
 
             
Item 197 Pic 221
  Safe   Sentry   Small safe       Newer   Good       $ 175  
 
                          Est. FMV   $ 599,580  

Appraiser’s Note: Electronic and IT equipment ‘ages’ very fast. New technology
often makes six-month old equipment ‘the previous generation’ and may even make
items obsolete within a short time. There is a current ‘glut’ of IT hardware.
PCs and Laptops are currently available at the lowest prices ever and have
advanced technology included.

      *  
This estimate assumes all items receive periodic maintenance according to
instructions of original manufacturing companies (or their successors) and by
use of replacement components (new, used, remanufactured, or reverse-engineered)
available either from those companies or from alternative suppliers in the
aftermarket.

 

32

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EXHIBIT A-l
Hyatt Gaming Management, Inc.
Capital Expenditure Monthly Report
Properly: GRAND LODGE CASINO

                                                                               
                                                                               
                                                                             
Paid     P.O.’s Oututdg                                                        
                      Spending To Date (US$)     Variance               2011    
                                  (Jan)     (Feb)     (Mar)     (Apr)     (May)
    (Jun)     (Jul)     (Aug)     (Sep)     (Oct)     (Nov)     (Dec)          
  Estimated                     Favorable               May 31, 2011            
  Approved                     Current     Current     Current     Current    
Current     Current     Current     Current     Current     Current     Current
    Current             Cost to     Total Project     Favorable    
(Unfavorable)   CER#   PRIORITY   CER#   Department   Short Description  
PROPOSED     Substitution     OTHER     CAPEX 2011     Month     Month     Month
    Month     Month     Month     Month     Month     Month     Month     Month
    Month     YTD Total     Complete     Spending     (Unfavorable)     %  
1
      1   Slots   Conversion Kito     81,440             Partial Complete      
81,440                               1,907       9.623                          
                                  $ 11,529,84               11,530       69.910
      85.8 %
2
      2   Slots   Kiosk Upgrade     3,663             Pending invoices      
3,663                               1,700                                      
                                1,700.00       1,700       3,400       263      
7.2 %
 
          Slots                                 0                              
                                                                               
                        0.0 %
 
                                                                               
                                                             
 
          Total Slots         85,103       0       0       85,103       0      
0       0       3,607       9.623       0       0       0       0       0      
0       0     $ 13,229.84       1,700       14,930       70,173       82.5 %
 
                                                                               
                                                             
 
                                                                               
                                                                               
                       
 
      3   Tables   Grand Lodge Casino Chips     10,000             Cancelled    
  0                                                                            
                        $ —       —       —       —       0.0 %
 
          Tables                                 0                              
                                                                               
                        0,0 %
 
                                                                               
                                                             
 
          Total Tables         10,000       0       0       0       0       0  
    0       3,607       0       0       0       0       0       0       0      
0     $ —       —       —       —       0.0 %
 
                                                                               
                                                             
 
      4   Marketing   73” (2) TV Plasma for Pit     17,451             Cancelled
      0                                                                        
                                                              0,0 %
 
          Marketing                                 0                          
                                                                               
                            0.0 %
 
                                                                               
                                                             
 
          Total Marketing         17,451       0     0       0       0       0  
    0       0       0       0       0       0       0       0       0       0  
  $ —       —       —       —       0,0 %
 
                                                                               
                                                             
 
      5   General & Admin   Accounting Printers     3,138             Cancelled
      0                                                                        
                                              —       —       0.0 %
 
      6   General & Admin   Optical Disk Equipment     5,925            
Complete       5,925                               1,993                        
                                            $ 1,982,91       —       1,993      
3.932       66.4 %
 
                                                                               
                                                             
 
          Total G&A         9,063       0       0       5,925       0       0  
    0       1.993       0       0       0       0       0       0       0      
0     $ 1,992,91       —       1,993       3,932       66.4 %
 
                                                                               
                                                             
 
      7   IT   Replacement Computers     12,200             Partial Cornplete  
    12,200                       4,356                                          
                                  $ 4.356.40               4,356       7,844    
  64.3 %
 
      8   IT   New server for I.G.S. and D.M.M.     23,700             Pending
Invoices       23,700                                       2.980              
                                              $ 2,979.64       17,673      
20,652       3.048       12.9 %
 
                                                                               
                                                             
 
                                            0                                  
                                                                               
                    0,0 %
 
          Total IT         35,900       0       0       35.900       0       0  
    4.356       0       2,980       0       0       0       0       0       0  
    0     $ 7,336,04       17,673       25,008       10,891       30.3 %
 
                                                                               
                                                             
 
                                                                               
                                                                               
                       
 
      9   Surveillance   Airship Digital Server Software     14,400            
Complete       14,400                               7,200       7,200          
                                                  $ 14.400.00       —      
14,400       —       0.0 %
 
      10   Surveillance   Replacement Color Fixed Cameras     1,145            
Pending Invoice       1,145                       441                          
                                                  $ 440.85       438       879  
    266       23.2 %
 
      11   Surveillance   Vlcon Digital PTZ Analog Cams     9,600            
Partial Complete       9,600                       1,529               1,526    
                                                        $ 3,055.67       —      
3.056       6,544       68.2 %
 
      12   Surveillance   Dell 15 review station computer     1.900            
Cancelled       0                                                              
                                      $ —               —       —       0.0 %
 
                                                                               
                                                             
 
          Total Surveillance         27,045       0       0       25,145       0
      0       1,970       7,200       8,726       0       0       0       0    
  0       0       0       17,897       438       18,335       6,610       1  
 
                                                                               
                                                             
 
 
 
          Total 2011         184,562       0       0       152.073       0      
0       8.327       12.800       21,329       0       0       0       0       0
      0       0       40.455       19,373       41,932       84,996       2  
 
                                                                               
                                                             
 
  2010   2   Slots   Conversion Kits     28,713             Complete      
28,713       10,078                                                            
                                $ 10,077,68                       28,713      
100,0 %
 
                                                                               
                                                             
 
          Total 2010 Carry over         28,713       0       0       28,713    
  10,078       0       0       0       0       0       0       0       0       0
      0       0     $ 10,077,68       0       0       28,713       100.0 %
 
                                                                               
                                                             
 
          Contingency   Contingency     25,000             Cancelled       0    
                                                                               
                $ —       —       —       —       0.0 %
 
                                                                               
                                                             
 
          Total Contingency         25,000       0       0       0       0      
0       0       0       0       0       0       0       0       0       0      
0       —       —       —       —       0.0 %
 
                                                                               
                                                             
 
                                                                               
                                                                               
                    0.0 %
 
                                                                               
                                                             
 
          Sub Total Normal Projects         238,275       0       0      
180,786       10,078       0       6,327       12,800       21,329       0      
0       0       0       0       0       0     $ 50,532.99       19,373      
41,932       113,709          
 
                                                                               
                                                             

 

33

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SCHEDULE B

Gaming Inventories
1.) Please see Exhibit B for detail listing

 

34

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Grand Lodge Casino

Exhibit B — Gaming Inventories
Inventory Slots

                          Quantity     Item   Est. Value  
 
    12000     Slot Vouchers (TITO)     1,955  
 
    4000     Jackpot Slips (blank tractor feed)     610  
 
    2000     W-2g custom 4-part forms     1,266  
 
             
Inventory Pit
                   
 
             
Bulk
    5000     Rating Cards     180  
Bulk
    8500     Closers     100  
Bulk
    2000     Bank Roll cards     100  
Bulk
    400     Road Maps     100  
20
    20     BJ Shoes     1,200  
 
  280 slvs     Dice     1,036  
 
  10,810 dks     Cards     1,053  
 
    8     BJ/TCP/LIR Layouts     800  
 
    2     Cps Layouts     560  
 
    2     Roulette Layouts     410  
 
    2     Poker Layouts     200  
 
                    Marketing / Promotional Inventory            
 
    150     Polo Shirts     600  
 
    200     Tshirts     400  
 
    60     Flash Drives     420  
 
    200     Wine Glasses     100  
 
    13     Poker Table Tops     195  
 
    40     Poker Chip Sets     800  
 
    80     Blankets     1,600  
 
    24     Beach Towels     120  
 
    16     Dish Sets     240  
 
    125     Hats     250  
Misc
          Office supplies     250  
 
    6000     PAC Cards-Blue     540  
 
    12500     PAC Cards-Gold     1,125  
 
    5500     PAC Cards-Platinum     495  
 
  7 bx     PAC Applications     147  
 
  9 bx     Comp Paper     144  
 
  12 bx     PAC Brochures     288  
 
                    Accounting Inventory            
 
                   
 
    2500     Paid Out Forms     100  
 
    5000     Credit / Fill Slips     100  
 
                    Cage Inventory            
 
                   
 
    4500     IGS Paper     100  
 
    3500     Marker Stock Electronic / Manual     150  
 
                   
 
          Total     17,734  
 
                 

 

35

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SCHEDULE C

Trademarks, Trade Names, Domain Names, Copyrights,
Trademarks and Trade Names
GRAND LODGE CASINO (word mark and design marks) Fed. Reg. No. 3,760,969
PLAYERS ADVANTAGE CLUB (word mark and design marks) Fed. Reg. No. 2,639,239
TWO FOR TUESDAY 2X SLOT PLAY (word mark and design marks) unregistered
Domain Names
Grandlodgecasino.com
Hyattcasinolaketahoe.com (license from appropriate Hyatt entity to use)
Copyrights
All marketing materials, including but not limited to duritrans, signage,
brochures, mailings, email blasts
website code and screen shots
employee handbooks (excluding Hyatt owned materials)

 

36

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SCHEDULE D

Contracts and Equipment Leases
1. Grand Lodge Casino — Key Contract List as of April 22, 2011 (see attached
Exhibit D-1).

 

37

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GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/l/11         SUB #   AGREEMENT   DATE  
DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION   Notice Period  
Termination   ASSIGNMENT PROVISION   Confidentially Provision
 
             
1
  Alpine Self Storage   2/1/2009   Off-site Self-Storage rental agreement.  
Month to Month (#3)   [ILLEGIBLE] forth above and continue on a month to month
basis as noted above, provided, however, that the term of the agreement shall be
automatically extended on the same terms and conditions for similar succeeding
periods at the stated rent unless and until Lessee has removed his property from
the premises and has given written notice to [ILLEGIBLE]   30 days   8/1/2011  
No —Section 18: Lessee shall not assign or sublease the premises or any portion
thereof. Any attempt to assign or sublease shall be void.   None
 
                                 
2
  Bally Gaming   4/23/2010   Slot Machine Participation Agreement   Month to
Month (#2)   YES - 2. “At the conclusion of the Initial Term, the lease shall
continue on a month-to.-month basis with each party having the right to
terminate the lease after the expiration of the Initial Term by providing thirty
days’ written notice to the other party.”   30 Days   8/1/2011   YES, with
consent — Section 6.5 “This Agreement may not be amended, modified, rescinded,
or assigned without the prior written consent of both parties.”   Yes —Section 2
of T&C: Must obtain prior written consent of Bally’s before disclosing
information to any third party.
 
                                   
 
                                 
3
  Biometrica Systems   10/1/2005   Software Rental and License Agreement for
Biometrica Recognition Software   Silent   YES - (Page 1) “Payment Terms:
Customer may terminate this Agreement at any time for any reason and without
further liability by giving Biometrica 30 days advance notice.”   30 Days  
8/1/2011   YES, with consent — (Page 1) — “Except as described in this contract,
without the written consent of Biometrica Systems, the Customer cannot transfer,
assign, license, sublicense, rent, lease, lend, copy, modify, translate,
sublicense, time-share, electronically transmit, decompile or reverse engineer
this software, the media, hardware find documentation associated therein.   Yes
— Assignment provision requires written consent before providing a copy to a
third party.
 
                                   
4
  Costco Wholesale Corporation   2/23/2007   Purchase Order Program
Participation   Silent   Yes - 7. “Costco or HCC Corporation may terminate this
agreement at any time, with or without cause provided, however, that in the
event of such termination HCC Corporation shall continue to be liable to Costco
for all amounts owed to Costco prior to the date of such termination.”   Silent
  8/1/2011   Silent   None
 
                                   
5
  Cummins Allison Corp   1/1/2009   Maintenance Service Contract for 2 JetScan
printers   Annual, renews at the start of each year.   Yes - Section 6(3) — If
in the event a contract is cancelled by the customer prior to the expiration
date, the prorated (unused) portion of the contract will be refunded to the
customer with any services performed during the partial contract period being
charged back, less the value of any paid portion of the contract that has not
been refunded.   30 Days prior to end of term.   8/1/2011   Silent   None
 
                                   
7
  Excel Building Cleaning   5/1/2005   Cleaning and Janitorial service in the
Casino   Month to Month (#1)   Yes - 1. Term This agreement shall be for a term
commencing on May 1, 2005 and continuing thereafter until terminated without
cause by either party upon delivery to the other party of thirty (30) days,
prior written notice, or with cause immediately upon written notice.   30 Days  
8/1/2011   Yes, but silent as to notice — Section 10/ll “This Agreement shall
insure to bind the successors, assigns and representatives of the parties
hereto.”   None

Last Updated: 04-22-2011

 

Page 1 of 6

--------------------------------------------------------------------------------

 

GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/1/11         SUB #   AGREEMENT   DATE  
DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION   Notice Period  
Termination   ASSIGNMENT PROVlSlON   Confidentially Provision
 
             
8
  Falcon Cable Systems Company II, L.P d/b/a Charter Communication   12/13/2010
  Provides Television Satellite Service   36 Months   NO — 3. Service Period:
Upon expiration of the initial term, this Agreement shall automatically renew
for successive one-month terms at Charter’s then-current applicable business
rates, unless either party terminates this Agreement by giving thirty (30) days
prior written notice to the other party before the expiration of the current
term. .... (No early termination provision or penalty — Section 10 — Default
results in termination of service).   30 Days on expiration of term   8/1/2011  
Yes, with consent — Section 18(b) “Customer may not assign or transfer (directly
or indirectly by any means, by operation of law or otherwise) this Agreement or
its rights or obligations hereunder to any other entity without first obtaining
written consent from Charter.”   Yes — Section 4 —“Customer hereby agrees to
keep confidential and not to disclose directly or indirectly to any third party,
the terms of this Agreement, except as may be required by law.
 
                                   
9
  Gaming International, Inc.   7/19/2006   Provide win cards for sale in the
gift shops   Renews for automatic one year periods following 90 days from
effective date (10/19)   Yes — Section 3. After the initial trial period, this
agreement can be cancelled with 30 days written notice to the other party,
during the course of the Agreement. Upon termination of this Agreement, HYATT
REGENCY — LAKE TAHOE CASINO shall (1) immediately return all materials provided
by Gaming International, Inc. pursuant to this Agreement and (2) pay for the
products received and sold through such date as full and complete payment.   30
Days   8/1/2011   Silent   None
 
                                   
10
  High Desert Microimaging   11/25/2010   Preventative Maintenance Agreement for
Canon Scanner   11/24/2011   Yes — “This agreement may be canceled by either
party within 30 days of written notice for the following reasons: If the
equipment is moved from the location specified on page 1 of this PMA, if the
equipment is sold, leased, or transferred, or if the equipment is operated by
any party not authorized by the customer.”   30 Days — with the transfer  
8/1/2011   Unclear and silent as to notice — The termination allows customer to
authorize a user, but there is no express assignment provision.   None
 
                                   
13
  International Game Technology   12/19/2007   Applicable to all IGT Game
purchases and leases   Ongoing   Yes — Section 8. Cancellations. Orders may be
canceled on the condition that Customer pay IGT for completed work allocated to
Customer’s order at the time of termination of work at the unit selling price,
along with (a) all costs, direct and indirect, for work in progress, (b) costs
resulting from the cancellation, (c) a reasonable profit to IGT therefrom.  
Silent   8/1/2011   Silent   None
 
                                   
14
  Iron Mountain Records Mgmt, Inc.   3/21/2007   Off-Site Records Storage   1
Year, renews for 1 year terms   No — 1. Term: ... Unless otherwise provided in a
Schedule, upon expiration of the intial term, the term will continue with
automatic renewal for additional one(1) year terms, unless written notice of
non-renewal is delivered by either party to the other no less than thirty
(30) days prior to the expiration date.   30 Days prior to end of term.  
8/1/2011   Yes, with prior written consent — This Agreement binds the successors
and assigns of the respective parties and cannot be changed orally. This
Agreement may not be assigned by either party (other than to an affiliate which
shall assume the obligations of the assignor by written instrument) without the
written consent of the other party, which shall not be unreasonably withheld or
delayed.   None

Last Updated: 04-22-2011

 

Page 2 of 6

--------------------------------------------------------------------------------

 

GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/1/11       Confidentially SUB #  
AGREEMENT   DATE   DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION  
Notice Period   Termination   ASSIGNMENT PROVISION   Provision
 
                                   
15
  JDL Digital Systems, Inc. d/b/a Airship   3/30/2011   Software maintenance and
upgrades for Surveillance Software.   Silent   YES — Once the software is
ordered a minimum of 50% cancellation fee will apply to cancellation of the
project before completion. Upon early cancellation all products listed but not
paid for are retained by JDL Digital Systems.   Silent   8/1/2011   YES, with
notice — “In the event that Grand Lodge Casino Transfers its interest in the
Gaming Operations at the Hyatt Regency Lake The, this Agreement and the rights
and obligations hereunder are fully assignable to the new operator upon Grand
Lodge Casino’s election and upon notice to JDL Digital Systems.”   None
 
                                   
16
  Kafoury, Armstrong & Co.   12/8/2010   Service Contract to conduct Internal
Audits for the 6 month period ending December 31, 2011   At conclusion of
service.   Silent   None   None — Work to be completed prior to transfer  
Silent   None
 
                                   
18
  Mosak   10/1/2004   Marketing Service
Agreement   October 1, 2005 Contract has expired   Yes – 2. Term. A. The term of
this Agreement shall commence on Oct. 1, 2004 and shall continue in full force
and effect until Oct. 1, 2005 unless earlier terminated by either party upon
written notice of such intention given thirty (30) days in advance.   30 Days  
8/1/2011   Yes, with prior written consent — Section 15. “The rights and
obligations of the parties hereunder shall not be assigned, in whole or in part,
without the prior written consent of the other party, which consent shall not be
unreasonably withheld. This Agreement shall inure to and be binding upon the
parties hereto and their respective representatives, successors and assigns.”  
Yes, but not with respect to the agreement — Section 6
 
                                   
19
  Muzak   1/26/2009   Provides background
music in casino   36 months (1/26/2012), automatically renew for 12 month
periods   No — Section 1. Term. .... an initial term of 36 months following the
date that our manager signs the Agreement. The Agreement will automatically
renew for subsequent 12 month terms. Either of us may cancel the automatic
renewal of the Agreement by sending a Notice of non-renewal to the other party
at least 90 days before the then current term of the Agreement expires.   90
Days   8/1/2011 (required
by agreement:
10/26/2011)   Yes, with prior written consent — Section 8. “No sale, transfer,
closure or change in your business will reduce or eliminate your obligations
under the Agreement. You cannot assign the Agreement without our prior written
consent, but we will not unreasonably withhold our consent.”   None
 
                                   
20
  Pitney Bowes Global   12/17/2010   Lease/financing
agreement for
postage equipment   66 months, with automatic 1 year renewals   Yes —
Section X3.2 Either party may terminate with or without cause upon thirty (30)
days’ prior written notice, provided that you remain responsible for paying any
outstanding invoices) after such discontinuation.   30 days   8/1/2011   Yes,
with prior written consent — Section G9.2 You may not assign this Agreement
without our prior written consent, which consent shall not be unreasonably
withheld. Any purported assignment is void.   None

      Last Updated: 04-22-2011    

 

Page 3 of 6

--------------------------------------------------------------------------------

 

GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/1/11       Confidentially SUB #  
AGREEMENT   DATE   DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION  
Notice Period   Termination   ASSIGNMENT PROVISION   Provision
 
                                   
21
  Quick Space Lease   5/27/2005   Lease of Storage Containers   Month to month  
Yes — Section 21. c. “Lessor has the right to postpone unit pickup for up to 21
working days. Rental charges will cease upon Lessee’s notification of
termination.”   30 Days   8/1/2011   Yes, with prior written consent
—Section 16, “Lessee shall not have the right to assign this Lease or to sublet,
rent, or otherwise hire out or transfer possession of, any of the Equipment to
any person, firm, partnership, association, or corporation other then Lessor,
without the prior written consent of Lessor.”   None
 
                                   
22
  Sage Software   16-Mar-07   Software system that
tracks fix assets   15-Jun-08   Yes — Term. You may terminate the License at any
time by destroying the Software together with all copies thereof... Upon
termination there will be no refund of any amounts paid by you.   Destroy
Software   8/1/2011   Silent   None
 
                                   
23
  Shuffle Master   (1) 3/11/08,
(2) 5/28/09,
(3) 6/24/09,
(4) 6/24/09,
(5)12/3/09,
(6) 1/13/10,
(7) 2/5/10, (8)
2/5/10, (9)
3/24/10, (10)
7/30/10, (11)
8/2/10   Various (11)
participation/service
agreements with Shuffle
Master   Month to Month   Yes — Section 7. Either party may terminate this
Agreement by giving the non-terminating party’ thirty (30) days written notice.
Following termination, the Products will be returned to SMI in proper working
order, normal wear and tear excepted.   30 Days   8/1/2011   Silent — Licensing
provisions are exclusive to HCC Corporation.   None
 
                                   
24
  Sierra Development
Company d/b/a Club
Calneva   8/24/2008   Sub-lease of rental space for the operation and management
of the sportsbook.   Until the last day of the calendar month following the 2013
NFL Super Bowl   YES — Section 1. Term of Lease. A. “c) upon the termination of
Landlord’s lease of the space in which the Hyatt Regency Lake Tahoe casino is
operated. B. On or before January 1, 2013, Landlord shall provide to Tenant
written notice of Landlord’s intention to either extend this Lease for a five
year term or terminate the Lease on the termination date.”   Silent   8/1/2011  
YES. but silent as to notice — Section 19 — “This Lease shall be binding upon
and inure to the benefit of the respective parties hereto, their legal
representatives, successors and assigns. Tenant may only assign this Lease with
Landlord’s prior written consent which consent shall not be unreasonably
withheld.”   None
 
                                   
25
  Sunny Day Guide   10/22/2010   Advertising agreement
for 2011   Silent   Silent   Silent   8/1/2011   Silent   None
 
                                   
26
  Tech Art   5/15/2008   License/Maintenance
Agreement for hole
card readers   5 Years (#7)   No — Section 8, Early Termination. At any time
after one (1) year, LICENSEE may terminate the License/Maintenance. Agreement
upon sixty (60) days written notice, provided, however, that in the event of
such termination, the monthly charge to LICENSEE pursuant to paragraph 6 shall
be adjusted retroactively to the unit rate for the actual term LICENSEE utilizes
the MAXTime units set forth in paragraph 7.   60 Days   7/1/2011   No — 15. This
Agreement may not be assigned in whole, or in part by either party. 16. This
Agreement shall be binding upon, and inure to the benefit of, and be enforceable
by and against the parties, their successors and assigns.”   None

      Last Updated: 04-22-2011    

 

Page 4 of 6

--------------------------------------------------------------------------------

 

GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/1/1l     Confidentially SUB #   AGREEMENT
  DATE   DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION   Notice
Period   Termination   ASSIGNMENT PROVISION   Provision
 
                                   
27
  Tip Top Amusement Co. Inc.   11/1/2010   Cigarette Vending Machine Agreement  
Month to Month (Article 5)   Yes — Article 5. Term. This Agreement shall
commence on November 1, 2010 and shall be for a term of one month from that
commencement date and shall be renewed automatically and continue for successive
periods unless notice of termination is given by either party to the other in
writing at least thirty (30) days prior to termination date.   30 Days  
8/1/2011   Yes, with prior written consent — Article 15: This Agreement shall
not be assignable by either party without the prior written consent of the other
party. Subject to the foregoing limitations, this Agreement shall endure to the
benefit of and be binding upon the successors and [ILLEGIBLE]   None
 
                                   
28
  TI Wholesale Distributors   8/22/2007   Processes used playing cards for
resale and paid on commission of sales.   3 Years (#7) Expiring 8/22/2010.
Agreement has expired.   Yes — Section 7. Term. This Agreement shall become
effective upon its execution by the parties as of the date on the face of this
agreement and shall expire three (3) years from that effective date. This
Agreement may be cancelled by either party with a 60 days notice in writing.  
60 Days   7/1/2011   Silent   None
 
                                   
29
  United States Playing Card Company   9/18/2009   Controls Playing Card
Purchase Orders   2 Years   No, only for cause — Section 8e. This Contract will
immediately terminate without further liability to USPC if Customer fails to
obtain and maintain the necessary gaming license to operate its casino facility
as required by applicable State Law or by a Tribal Compact approved and
recognized by the National Indian Gaming Commission.   None   Courtesy Call
Prior To Termination   Yes, with prior written consent [ILLEGIBLE] “This
Agreement shall be binding upon and inure to the benefit of the parties herein
and their respective successors and assigns. Customer may not assign its rights
or obligations under this Agreement in any way except with the consent of USPC
which shall not be unreasonably [ILLEGIBLE]   None
 
                                   
30
  Universal Recovery Corporation   2/20/2007   Check Collection Services   1
Year, Auto Renews unless 30 day notice (#6)   Yes — Section 6. ... Either party
may terminate this contract at any time by giving a thirty (30) day written
notice except that once notice is received by URC, ninety (90) days will be
allowed for URC to settle all non-paying accounts and URC shall retain all
accounts on which payments have begun or promises have been made until payments
are completed.   30 Days   8/1/2011   Silent   None
 
                                   
31
  Western Money Systems   2/1/2011   Self Service Redemption Kiosk   1/31/2012,
with automatic renewal unless 90 day notice is provided   Yes — Section 2.
Cancellation: Either party shall have the right to cancel this agreement,
without cause, upon 90 days written notice. Charges will be prorated to the date
the cancellation is in effect.   90 Days   6/3/2011   Yes, with prior written
consent — This Agreement is not assignable, or transferable by the customer and
requests for refunds will not be honored, unless consented to in writing by WMS.
  None
 
                                   
33
  Xerox   11/29/2006   Lease Agreement for Copier   11/29/2011, then month to
month unless 30 day notice is provided   Yes, for termination on 11/29/2011 —
Section 15. B. During this renewal period, either party may terminate this
Agreement upon at least thirty (30) days notice.   30 Days   8/1/2011   Yes,
with prior written consent — Section 8. If you wish to assign any rights or
obligations under this Agreement, you shall provide a written notice to Xerox of
such request for consent...”   None

      Last Updated: 04-22-2011  

 

Page 5 of 6

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GRAND LODGE CASINO
Key Contract List

                                                                  RECOMMENDED  
                                  NOTICE DATE         ITEM       EFFECTIVE      
TERM OF       Termination   ASSUMING 9/1/1l     Confidentially SUB #   AGREEMENT
  DATE   DESCRIPTION   CONTRACT   FAVORABLE TERMINATION PROVISION   Notice
Period   Termination   ASSIGNMENT PROVISION   Provision
 
                                   
34
  Xerox   10/282004   Lease Agreement for Copier   10/28/2009, then month to
month.   Yes — Section 12. Renewal: During this renewal period, either side may
terminate this Agreement upon at least thirty (30) days notice.   30 Days  
8/1/2011   Yes, with prior written consent - Section 8. If you wish to assign
any rights or obligations under this Agreement, you shall provide a written
notice to Xerox of such request for consent...”   None

      Last Updated: 04-22-2011  

 

Page 6 of 6

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SCHEDULE E
Supplies and Equipment with a value of $100.00 or more
1.) Please see Exhibit E for detailed information

 

19

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Grand Lodge Casino
Exhibit E — Operating Supplies & Small Equipment

                              Quantity   Item   Est. Value   Inventory Slots  
 
                    Cartons   261  
Cigarettes
    13,050             Misc  
Office Suplies — printer cartriges pencils, tapes and the like
    350             9  
Slot Radios — Kenwood TK3160
    315           7  
Security Radios — Motorola CP200
    280           1  
Kobetron GI3000 — Eprom Tester
    500           37 yards  
Slot / Pit Chair Upholstry
    550           1  
Rick laptop computer Dell 5500
    350   Inventory Pit  
 
                      Misc      
office supplies:
               
Printer cartriges, pencils, forms,
    350   Accounting Inventory  
 
                           
Cyndy Laptop
    300              
Misc Supplies
    200              
Toner
    300   Cage Inventory  
 
                           
Misc Supplies
    300              
Toner
    150              
 
                 
 
    16,995