Exhibit 10.2

EXECUTION COPY

HEAD LEASE AGREEMENT

 

BETWEEN

 

SENECA NATION OF INDIANS

 

as Landlord

and

 

SENECA ERIE GAMING CORPORATION

 

as Tenant

Dated February 28, 2007
Effective as of:  April 1, 2006

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TABLE OF CONTENTS

 

 

 

PAGE

ARTICLE 1. PREMISES AND TERM

 

1

 

 

 

Section 1.01

 

Premises

 

1

Section 1.02

 

Term

 

1

ARTICLE 2. RENT

 

1

Section 2.01

 

Rent Payments.

 

1

Section 2.02

 

Rent Net to Landlord

 

2

 

 

 

 

 

ARTICLE 3. REPRESENTATIONS AND WARRANTIES

 

2

 

 

 

Section 3.01

 

Representations and Warranties of Tenant

 

2

Section 3.02

 

Representations and Warranties of Landlord

 

3

 

 

 

 

 

ARTICLE 4. INSURANCE

 

4

 

 

 

Section 4.01

 

Required Coverages.

 

4

Section 4.02

 

Policy Requirements.

 

5

Section 4.03

 

Blanket Policies

 

5

 

 

 

 

 

ARTICLE 5. USE OF INSURANCE PROCEEDS

 

6

 

 

 

 

 

ARTICLE 6. CONDEMNATION

 

6

 

 

 

Section 6.01

 

Total Condemnation

 

6

Section 6.02

 

Award to Landlord

 

6

Section 6.03

 

Date of Taking

 

7

Section 6.04

 

Partial Condemnation

 

7

 

 

 

 

 

ARTICLE 7. ASSIGNMENT, SUBLETTING AND MORTGAGES

 

7

 

 

 

Section 7.01

 

Restrictions on Right of Tenant to Transfer Lease

 

7

Section 7.02

 

Leasehold Mortgage

 

7

Section 7.03

 

Obligations of Subtenants

 

10

Section 7.04

 

Tenant’s Obligation to Cure

 

11

Section 7.05

 

No Waiver

 

11

Section 7.06

 

Intentionally Omitted.

 

11

Section 7.07

 

Tenant’s Use

 

11

Section 7.08

 

Mortgage or other Security Agreement Requirements

 

11

Section 7.09

 

Mortgagee; Arbitration

 

11

Section 7.10

 

Landlord to Join in Tenant Mortgage

 

12

 

 

 

 

 

ARTICLE 8. INTENTIONALLY OMITTED

 

12

 

 

 

ARTICLE 9. WASTE AND DAMAGE TO PREMISES

 

12

 

 

 

Section 9.01

 

Tenant’s Obligations

 

12

Section 9.02

 

No Landlord Services

 

12

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ARTICLE 10. CHANGES, ALTERATIONS AND ADDITIONS

 

12

 

 

 

ARTICLE 11. REQUIREMENTS OF PUBLIC AUTHORITIES AND OF INSURANCE UNDERWRITERS AND
POLICIES

 

13

 

 

 

ARTICLE 12. INTENTIONALLY OMITTED

 

13

 

 

 

ARTICLE 13. DISCHARGE OF LIENS

 

13

 

 

 

Section 13.01

 

Discharge of Liens

 

13

Section 13.02

 

Tenant Indemnity for Liens

 

14

 

 

 

 

 

ARTICLE 14. LIMITED OBLIGATIONS OF THE PARTIES; INDEMNITY

 

14

 

 

 

Section 14.01

 

Tenant Accepts “As Is”

 

14

Section 14.02

 

No Landlord Representations

 

14

Section 14.03

 

No Landlord Liability/Indemnification

 

14

Section 14.04

 

Tenant Indemnity; Insurance

 

16

Section 14.05

 

Survival

 

16

Section 14.06

 

No Consequential Damages

 

16

 

 

 

 

 

ARTICLE 15. LANDLORD NOT LIABLE FOR INJURY OR DAMAGE, ETC.

 

16

 

 

 

ARTICLE 16. INTENTIONALLY OMITTED

 

16

 

 

 

ARTICLE 17. RIGHT OF INSPECTION

 

16

 

 

 

Section 17.01

 

Landlord Access to Premises

 

16

Section 17.02

 

No Landlord Obligation to Repair

 

16

 

 

 

 

 

ARTICLE 18. LANDLORD’S RIGHT TO PERFORM TENANT’S COVENANTS

 

17

 

 

 

ARTICLE 19. PERMITTED USE; NO UNLAWFUL OCCUPANCY

 

17

 

 

 

ARTICLE 20. EVENTS OF DEFAULT, CONDITIONAL LIMITATIONS, REMEDIES

 

17

 

 

 

Section 20.01

 

Event of Default

 

17

Section 20.02

 

Tenant Default; Payment of Rent and Termination of Lease

 

18

Section 20.03

 

Intentionally omitted.

 

19

Section 20.04

 

No Reinstatement

 

19

Section 20.05

 

Strict Performance

 

19

Section 20.06

 

Remedies Cumulative

 

19

Section 20.07

 

Landlord’s Costs and Expenses

 

19

Section 20.08

 

Tenant Bankruptcy

 

20

 

 

 

 

 

ARTICLE 21. NOTICES

 

21

 

 

 

ARTICLE 22. TERMINATION

 

22

 

 

 

ARTICLE 23. INTENTIONALLY OMITTED

 

22

 

 

 

ARTICLE 24. INTENTIONALLY OMITTED

 

22

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ARTICLE 25. EXCAVATIONS AND SHORING

 

22

 

 

 

ARTICLE 26. CERTIFICATES BY LANDLORD AND TENANT

 

23

 

 

 

Section 26.01

 

Landlord Certificate

 

23

Section 26.02

 

Tenant Certificate

 

23

 

 

 

 

 

ARTICLE 27. INTENTIONALLY OMITTED

 

23

 

 

 

ARTICLE 28. ENTIRE AGREEMENT

 

23

 

 

 

ARTICLE 29. QUIET ENJOYMENT

 

23

 

 

 

ARTICLE 30. DISPUTES

 

24

 

 

 

ARTICLE 31. RECORDING OF MEMORANDUM

 

24

 

 

 

ARTICLE 32. NO DISCRIMINATION WITH RESPECT TO THE PREMISES

 

24

 

 

 

ARTICLE 33. TENANT’S CHARTER

 

24

 

 

 

ARTICLE 34. MISCELLANEOUS

 

24

 

 

 

Section 34.01

 

Captions

 

24

Section 34.02

 

Table of Contents

 

24

Section 34.03

 

Plurals

 

24

Section 34.04

 

Execution of Documents

 

25

Section 34.05

 

No Merger

 

25

Section 34.06

 

No Broker

 

25

Section 34.07

 

Changes of Lease

 

25

Section 34.08

 

Governing Law

 

25

Section 34.09

 

Successors and Assigns

 

25

Section 34.10

 

No Violations

 

25

Section 34.11

 

References

 

25

Section 34.12

 

Severable

 

25

Section 34.13

 

No Abatement

 

25

Section 34.14

 

Substitution

 

26

Section 34.15

 

Lease to Run With Land

 

26

Section 34.16

 

Force Majeure

 

26

Section 34.17

 

Easements

 

26

 

 

 

 

 

Exhibits

 

 

 

 

 

 

 

 

 

Exhibit A

 

Description of Premises Leased for SEGC Use

 

 

 

iii

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THIS HEAD LEASE AGREEMENT (this “Lease” or “Lease Agreement”) dated February 28,
2007 and effective as of April 1, 2006 (the “Effective Date”), between the
Seneca Nation of Indians (“Landlord” or the “Nation”), a sovereign Indian
nation, having an office at 1490 Route 438, Irving, New York (Cattaraugus
Territory) 14801 and an office with the address of P.O. Box 231, Salamanca, New
York (Allegany Territory) 14779, and the Seneca Erie Gaming Corporation, a
wholly-owned governmental instrumentality of the Nation (“Tenant” or “SEGC”),
having an address at 310 Fourth Street, Niagara Falls, New York (Nation
Territory) 14302-0777,

W I T N E S S E T H:

WHEREAS, since April 1, 2006, the Nation has leased to SEGC, a wholly owned
governmental instrumentality of the Nation, land on the Nation’s Buffalo Creek
Territory, as more fully described on Exhibit A hereto (the “Premises”) for use
as the site for the Seneca Buffalo Creek Casino and for related purposes
pursuant to an oral lease agreement; and

WHEREAS, the parties acknowledge that SEGC has paid and the Nation has received
all payments due to the Nation under said lease agreement for the lease of the
Premises through the date hereof; and

WHEREAS, the Nation and SEGC, pursuant to this Lease, desire to memorialize in
writing the terms and conditions pursuant to which SEGC leases the Premises.

NOW, THEREFORE, in consideration of the matters above recited, for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties, the parties hereto formally covenant, agree and
bind themselves as follows:

ARTICLE 1.
PREMISES AND TERM

Section 1.01           Premises.  Landlord does hereby lease to Tenant, and
Tenant does hereby hire and take from Landlord the Premises, subject to all
title matters affecting the Land and existing as of the date of this Lease
Agreement.

Section 1.02           Term.  The Lease term (the “Term”) shall commence as of
the Effective Date of this Lease and shall expire on the earlier of either
(i) the twenty-first (21st) anniversary of gaming activities under the Compact
for Class III gaming between the Nation and the State of New York, or (ii) such
other date as may be herein provided.

ARTICLE 2.
RENT

SECTION 2.01           RENT PAYMENTS.

(A)           RENT.  COMMENCING AS OF OCTOBER 1, 2006, TENANT SHALL PAY DIRECTLY
TO THE LANDLORD, OR LANDLORD’S REPRESENTATIVE IF TENANT IS SO NOTIFIED, ANNUAL
RENT (“ANNUAL RENT”) IN THE AMOUNT OF FIFTEEN MILLION DOLLARS ($15,000,000.00)
IN EQUAL MONTHLY INSTALLMENTS OF ONE MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS
($1,250,000.00) IN ADVANCE ON THE FIRST DAY OF

1

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EACH CALENDAR MONTH..  ON OCTOBER 1 OF EACH YEAR, THE ANNUAL RENT SHALL
AUTOMATICALLY INCREASE TO 103% OF THE PRIOR YEAR’S ANNUAL RENT, PROVIDED THAT NO
INCREASE IN ANNUAL RENT HEREUNDER MAY CONTRAVENE, OR CONSTITUTE A DEFAULT UNDER,
ANY AGREEMENT, INDENTURE, INSTRUMENT OR OTHER COMMITMENT LEGALLY BINDING UPON
LANDLORD AND/OR TENANT, OR TO WHICH THE PREMISES ARE SUBJECT (“COMMITMENTS”). 
ANY PROPOSED INCREASE TO AN AMOUNT IN EXCESS OF 103% OF THE PRIOR YEAR’S ANNUAL
RENT SHALL BE JOINTLY REVIEWED BY LANDLORD AND TENANT FOR CONSISTENCY WITH
THEN-APPLICABLE COMMITMENTS, WITH ANY SUCH INCREASE TO BE CONFIRMED BY THE
PARTIES IN WRITING PRIOR TO ITS EFFECTIVENESS.  THE DELAY OR FAILURE OF EITHER
PARTY IN COMPUTING THE ANNUAL RENT INCREASE OR EXECUTING A WRITTEN STATEMENT OF
CONFIRMATION OF SUCH ANNUAL RENT INCREASE WILL NOT IMPAIR THE CONTINUING
OBLIGATION OF TENANT TO PAY ANNUAL RENT. ALL AMOUNTS PAYABLE BY TENANT PURSUANT
TO THIS LEASE AGREEMENT, INCLUDING, WITHOUT LIMITING THE FOREGOING, ANNUAL RENT,
AND ANY OTHER SUMS, COSTS, EXPENSES OR DEPOSITS THAT TENANT IN ANY OF THE
PROVISIONS OF THIS LEASE AGREEMENT ASSUMES OR AGREES TO PAY AND/OR DEPOSIT,
SHALL CONSTITUTE “RENT” UNDER THIS LEASE.

(B)           INTEREST AND PENALTIES.  IF ANY PAYMENT OF RENT SHALL REMAIN
UNPAID FOR MORE THAN THIRTY (30) DAYS BEYOND THE DUE DATE THEREOF, TENANT SHALL
PAY TO LANDLORD A LATE CHARGE EQUAL TO FOUR PERCENT (4%) OF ANY RENTAL NOT PAID
WHEN DUE AND INTEREST AT A RATE EQUAL TO THE PRIME RATE (AS HEREINAFTER DEFINED)
(THE “DEFAULT RATE”), SUCH INTEREST TO ACCRUE FROM THE DUE DATE OF SUCH PAYMENT
TO THE DATE OF ACTUAL PAYMENT THEREOF.  SUCH LATE CHARGE AND INTEREST SHALL
CONSTITUTE RENT HEREUNDER AND SHALL BE DUE AND PAYABLE BY TENANT ON DEMAND.  NO
FAILURE BY LANDLORD TO INSIST UPON STRICT PERFORMANCE BY TENANT OF ITS
OBLIGATIONS TO PAY LATE CHARGES SHALL CONSTITUTE A WAIVER BY LANDLORD OF ITS
RIGHTS TO ENFORCE THE PROVISIONS OF THIS ARTICLE 2 IN ANY INSTANCE THEREAFTER
OCCURRING.  THIS PROVISION SHALL NOT BE CONSTRUED IN ANY WAY TO EXTEND THE GRACE
PERIOD OR NOTICE PERIOD PROVIDED FOR IN THIS LEASE.  AS USED HEREIN “PRIME RATE”
SHALL MEAN THE RATE REPORTED BY THE WALL STREET JOURNAL (OR ITS SUCCESSORS) AS
THE SO-CALLED “PRIME RATE”.

Section 2.02           Rent Net to Landlord.  Rent shall be absolutely net to
Landlord without any abatement, deduction, counterclaim, set off or offset
whatsoever, so that this Lease shall yield, net to Landlord, the Rent due under
the Lease. Tenant shall pay all costs, expenses and charges of every kind and
nature relating to the Premises, which may arise or become due or payable during
or after (but attributable to a period falling within) the Term.

ARTICLE 3.
REPRESENTATIONS AND WARRANTIES

Section 2.01           Representations and Warranties of Tenant.  Tenant does
hereby represent and warrant as follows:

(A)           EXISTENCE AND POWER.  TENANT IS A GOVERNMENTAL INSTRUMENTALITY OF
A SOVEREIGN NATION AND FEDERALLY RECOGNIZED “INDIAN TRIBE” AND HAS THE POWER TO
ENTER INTO THE TRANSACTION CONTEMPLATED BY THIS LEASE AGREEMENT AND TO CARRY OUT
ITS OBLIGATIONS AND EXERCISE ITS RIGHTS HEREUNDER.

(B)           AUTHORIZATION.  TENANT IS AUTHORIZED AND HAS THE POWER UNDER THE
LAWS OF THE NATION TO ENTER INTO THIS LEASE AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND TO PERFORM AND CARRY OUT ALL COVENANTS AND OBLIGATIONS
ON ITS PART TO BE PERFORMED UNDER AND PURSUANT TO THIS LEASE AGREEMENT.  TENANT
BY PROPER ACTION OF ITS BOARD OF DIRECTORS AND THE

2

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NATION’S COUNCIL HAS DULY AUTHORIZED THE EXECUTION, DELIVERY AND PERFORMANCE OF
THIS LEASE AGREEMENT AND THE CONSUMMATION OF THE TRANSACTIONS HEREIN
CONTEMPLATED.

(C)           VALIDITY.  TENANT IS NOT PROHIBITED FROM ENTERING INTO THIS LEASE
AGREEMENT AND DISCHARGING AND PERFORMING ALL COVENANTS AND OBLIGATIONS ON ITS
PART TO BE PERFORMED UNDER AND PURSUANT TO THIS LEASE AGREEMENT AND THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY.  COMPLIANCE WITH THE
PROVISIONS OF THIS LEASE AGREEMENT WILL NOT CONFLICT WITH OR VIOLATE OR
CONSTITUTE A BREACH OF OR A DEFAULT UNDER, THE TERMS, CONDITIONS OR PROVISIONS
OF ANY LAW, RULE, REGULATION OR ORDER, JUDGMENT OR DECREE OF ANY COURT,
CONTRACTUAL LIMITATION, RESTRICTION NOR INDENTURE, DEED OF TRUST, MORTGAGE, LOAN
AGREEMENT, OTHER EVIDENCE OF INDEBTEDNESS OR ANY OTHER AGREEMENT OR INSTRUMENT
TO WHICH TENANT IS A PARTY OR BY WHICH IT OR ANY OF ITS PROPERTY IS BOUND. 
NEITHER TENANT ENTERING INTO THIS LEASE AGREEMENT NOR TENANT DISCHARGING AND
PERFORMING ALL COVENANTS AND OBLIGATIONS ON ITS PART TO BE PERFORMED UNDER AND
PURSUANT TO THIS LEASE AGREEMENT WILL BE IN CONFLICT WITH OR RESULT IN A BREACH
OF OR CONSTITUTE (WITH DUE NOTICE AND/OR LAPSE OF TIME) A DEFAULT UNDER ANY OF
THE FOREGOING, OR RESULT IN THE CREATION OR IMPOSITION OF ANY LIEN OF ANY NATURE
UPON ANY OF THE PROPERTY OF TENANT UNDER THE TERMS OF ANY OF THE FOREGOING, NOR
ARE THERE ANY ACTIONS, SUITS OR PROCEEDINGS BY OR BEFORE ANY COURT,
ADMINISTRATIVE AGENCY OR OTHER GOVERNMENTAL AUTHORITIES PENDING, OR TO THE BEST
OF TENANT’S KNOWLEDGE, THREATENED, AGAINST OR AFFECTING TENANT WHICH WOULD HAVE
A MATERIAL, ADVERSE AFFECT ON THE ABILITY OF TENANT TO PERFORM ITS OBLIGATIONS
UNDER THIS LEASE AGREEMENT.  THIS LEASE AGREEMENT IS THE LEGAL, VALID AND
BINDING OBLIGATION OF TENANT ENFORCEABLE AGAINST TENANT IN ACCORDANCE WITH ITS
TERMS.

Section 3.02           Representations and Warranties of Landlord.  The Landlord
does hereby represent and warrant as follows:

(A)           EXISTENCE AND POWER.  LANDLORD IS A SOVEREIGN NATION AND FEDERALLY
RECOGNIZED “INDIAN TRIBE” AND HAS THE POWER TO ENTER INTO THE TRANSACTION
CONTEMPLATED BY THIS LEASE AGREEMENT AND TO CARRY OUT ITS OBLIGATIONS AND
EXERCISE ITS RIGHTS HEREUNDER.

(B)           AUTHORIZATION.  LANDLORD IS AUTHORIZED AND HAS THE POWER UNDER THE
LAWS OF THE NATION TO ENTER INTO THIS LEASE AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND TO PERFORM AND CARRY OUT ALL COVENANTS AND OBLIGATIONS
ON ITS PART TO BE PERFORMED UNDER AND PURSUANT TO THIS LEASE AGREEMENT. 
LANDLORD BY PROPER ACTION OF ITS TRIBAL COUNCIL HAS DULY AUTHORIZED THE
EXECUTION, DELIVERY AND PERFORMANCE OF THIS LEASE AGREEMENT AND THE CONSUMMATION
OF THE TRANSACTIONS HEREIN CONTEMPLATED.

(C)           VALIDITY.  LANDLORD IS NOT PROHIBITED FROM ENTERING INTO THIS
LEASE AGREEMENT AND DISCHARGING AND PERFORMING ALL COVENANTS AND OBLIGATIONS ON
ITS PART TO BE PERFORMED UNDER AND PURSUANT TO THIS LEASE AGREEMENT AND THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY.  COMPLIANCE WITH THE
PROVISIONS OF THIS LEASE AGREEMENT WILL NOT CONFLICT WITH OR VIOLATE OR
CONSTITUTE A BREACH OF OR A DEFAULT UNDER, THE TERMS, CONDITIONS OR PROVISIONS
OF ANY LAW, RULE, REGULATION OR ORDER, JUDGMENT OR DECREE OF ANY COURT,
CONTRACTUAL LIMITATION, RESTRICTION NOR INDENTURE, DEED OF TRUST, MORTGAGE, LOAN
AGREEMENT, OTHER EVIDENCE OF INDEBTEDNESS OR ANY OTHER AGREEMENT OR INSTRUMENT
TO WHICH LANDLORD IS A PARTY OR BY WHICH IT OR ANY OF ITS PROPERTY IS BOUND. 
NEITHER LANDLORD ENTERING INTO THIS LEASE AGREEMENT NOR LANDLORD DISCHARGING AND
PERFORMING ALL COVENANTS AND OBLIGATIONS ON ITS PART TO BE PERFORMED UNDER AND

3

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PURSUANT TO THIS LEASE AGREEMENT WILL BE IN CONFLICT WITH OR RESULT IN A BREACH
OF OR CONSTITUTE (WITH DUE NOTICE AND/OR LAPSE OF TIME) A DEFAULT UNDER ANY OF
THE FOREGOING, OR RESULT IN THE CREATION OR IMPOSITION OF ANY LIEN OF ANY NATURE
UPON ANY OF THE PROPERTY OF LANDLORD UNDER THE TERMS OF ANY OF THE FOREGOING,
NOR ARE THERE ANY ACTIONS, SUITS OR PROCEEDINGS BY OR BEFORE ANY COURT,
ADMINISTRATIVE AGENCY OR OTHER GOVERNMENTAL AUTHORITIES PENDING, OR TO THE BEST
OF LANDLORD’S KNOWLEDGE, THREATENED, AGAINST OR AFFECTING LANDLORD WHICH WOULD
HAVE A MATERIAL, ADVERSE AFFECT ON THE ABILITY OF LANDLORD TO PERFORM ITS
OBLIGATIONS UNDER THIS LEASE AGREEMENT.  THIS LEASE AGREEMENT IS THE LEGAL,
VALID AND BINDING OBLIGATION OF LANDLORD ENFORCEABLE AGAINST LANDLORD IN
ACCORDANCE WITH ITS TERMS.

ARTICLE 4.
INSURANCE

SECTION 4.01           REQUIRED COVERAGES.

(A)           TENANT, AT ITS SOLE COST AND EXPENSE, SHALL CARRY OR CAUSE TO BE
CARRIED, INSURANCE COVERAGE OF THE TYPE AND IN MINIMUM LIMITS AS FOLLOWS:

(I)            INSURANCE ON THE PREMISES, INCLUDING ALL IMPROVEMENTS LOCATED
THEREIN AND THEREON, SHALL BE CARRIED UNDER AN “ALL RISK” FORM, INCLUDING DAMAGE
BY WATER AND SUBSIDENCE, EXCEPT FOR FLOOD AND EARTHQUAKE.  SUCH INSURANCE SHALL
BE CARRIED IN AN AMOUNT EQUAL TO FULL REPLACEMENT VALUE, SUBJECT TO INSURANCE
MARKET CONDITIONS, OF THE IMPROVEMENTS.

(II)           COMMERCIAL GENERAL LIABILITY INSURANCE SHALL BE CARRIED ON THE
PREMISES AND OPERATIONS OF THE PREMISES AGAINST ANY LIABILITY FOR BODILY INJURY,
DEATH, AND PROPERTY DAMAGE.  SUCH COMMERCIAL GENERAL LIABILITY INSURANCE SHALL
BE ON AN OCCURRENCE BASIS.  THE INSURANCE AGAINST LIABILITY FOR BODILY INJURY
AND/OR DEATH SHALL BE NOT LESS THAN FIVE MILLION AND 00/100 ($5,000,000.00)
DOLLARS FOR EACH OCCURRENCE FOR BODILY INJURY AND PROPERTY DAMAGE WITH AN ANNUAL
GENERAL AGGREGATE OF NOT LESS THAN TEN MILLION AND 00/100 ($10,000,000.00)
DOLLARS.

(III)          MOTOR VEHICLE LIABILITY AND PROPERTY DAMAGE INSURANCE COVERAGE ON
ALL OWNED, NON-OWNED AND HIRED VEHICLES SHALL BE PROVIDED IN THE AMOUNTS OF FIVE
MILLION AND 00/100 ($5,000,000.00) DOLLARS COMBINED SINGLE LIMIT FOR BODILY
INJURY AND PROPERTY DAMAGE.

(IV)          COMMERCIAL GENERAL LIABILITY INSURANCE SHALL INCLUDE COMPLETED
OPERATIONS AND PRODUCTS LIABILITY.

(V)           WORKERS’ COMPENSATION INSURANCE, IF APPLICABLE BY LAW OR
AGREEMENT, SHALL BE CARRIED ON ALL PERSONS EMPLOYED BY TENANT OR ON ITS BEHALF,
ON OR AT THE PREMISES, OR IN THE OPERATIONS OF TENANT IN MINIMUM AMOUNTS SO
PROVIDED BY LAW OR AGREEMENT.

(B)           ALL INSURANCE PROVIDED BY OR ON BEHALF OF TENANT SHALL BE CARRIED
IN FAVOR OF LANDLORD AND TENANT, AS THEIR RESPECTIVE INTERESTS MAY APPEAR, AS
“ADDITIONAL INSUREDS”. ANY COVERAGE PROVIDED BY TENANT, OR ON ITS BEHALF, AS
REQUIRED HEREIN ALSO SHALL NAME EACH MORTGAGEE (AS HEREINAFTER DEFINED) AS AN
ADDITIONAL INSURED UNDER A STANDARD MORTGAGEE CLAUSE (AS HEREINAFTER DEFINED).

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SECTION 4.02           POLICY REQUIREMENTS.

(A)           ALL INSURANCE REQUIRED BY ANY PROVISION OF THIS LEASE SHALL BE IN
SUCH FORM AND SHALL BE ISSUED BY SUCH RESPONSIBLE COMPANIES LICENSED AND
AUTHORIZED TO DO BUSINESS IN THE STATE OF NEW YORK AS ARE REASONABLY ACCEPTABLE
TO LANDLORD AND ANY MORTGAGEE.  ALL POLICIES REFERRED TO IN THIS LEASE SHALL BE
PROCURED, OR CAUSED TO BE PROCURED, BY TENANT AT NO EXPENSE TO LANDLORD AND FOR
PERIODS OF NOT LESS THAN ONE (1) YEAR.  NEW OR RENEWAL POLICIES REPLACING ANY
POLICIES EXPIRING DURING THE TERM OR MEMORANDA OR CERTIFICATES THEREOF, AS
AFORESAID, SHALL BE DELIVERED TO LANDLORD ON THE EXECUTION OF THIS LEASE AND AT
LEAST THIRTY (30) DAYS PRIOR TO THE DATE OF EXPIRATION, TOGETHER WITH PROOF
SATISFACTORY TO LANDLORD THAT THE FULL PREMIUMS HAVE BEEN PAID. PREMIUMS ON
POLICIES SHALL NOT BE FINANCED IN ANY MANNER WHEREBY EACH MORTGAGEE, ON DEFAULT
OR OTHERWISE, SHALL HAVE THE RIGHT OR PRIVILEGE OF SURRENDERING OR CANCELING THE
POLICIES, PROVIDED, HOWEVER, THAT PREMIUMS MAY BE PAID IN INSTALLMENTS.

(B)           TENANT AND LANDLORD SHALL COOPERATE IN CONNECTION WITH THE
COLLECTION OF ANY INSURANCE MONEYS THAT MAY BE DUE IN THE EVENT OF LOSS AND
TENANT AND LANDLORD SHALL EXECUTE AND DELIVER SUCH PROOFS OF LOSS AND OTHER
INSTRUMENTS WHICH MAY BE REQUIRED FOR THE PURPOSE OF OBTAINING THE RECOVERY OF
ANY SUCH INSURANCE MONEYS.

(C)           TENANT SHALL NOT CARRY SEPARATE INSURANCE (OTHER THAN PERSONAL
INJURY LIABILITY INSURANCE) CONCURRENT IN FORM OR CONTRIBUTING IN THE EVENT OF
LOSS WITH THAT REQUIRED BY THIS LEASE TO BE FURNISHED BY TENANT, UNLESS LANDLORD
AND EACH MORTGAGEE (AS HEREINAFTER DEFINED) ARE INCLUDED THEREIN AS INSUREDS
WITH LOSS PAYABLE AS PROVIDED IN THIS LEASE.

(D)           EACH POLICY OF INSURANCE REQUIRED TO BE OBTAINED BY TENANT AS
HEREIN PROVIDED AND EACH DUPLICATE POLICY ISSUED BY THE INSURER SHALL CONTAIN
(I) A PROVISION THAT NO ACT OR OMISSION OF TENANT SHALL AFFECT OR LIMIT THE
OBLIGATION OF THE INSURANCE COMPANY TO PAY THE AMOUNT OR ANY LOSS SUSTAINED,
(II) AN AGREEMENT BY THE INSURER THAT SUCH POLICY SHALL NOT BE CANCELLED OR
MATERIALLY MODIFIED WITHOUT AT LEAST THIRTY (30) DAYS’ PRIOR WRITTEN NOTICE TO
LANDLORD AND TO EACH MORTGAGEE AND (III) AN AGREEMENT BY THE INSURER PURSUANT TO
WHICH THE INSURER WAIVES SUBROGATION (WITH THE EXCEPTION OF WORKERS’
COMPENSATION) AND HAVING OBTAINED SUCH CLAUSE OR ENDORSEMENT OF WAIVER OF
SUBROGATION, TENANT AGREES THAT IT WILL NOT MAKE ANY CLAIMS AGAINST, OR SEEK TO
RECOVER FROM, LANDLORD FOR ANY LOSS OR DAMAGE TO TENANT’S PROPERTY COVERED BY
ITS FIRE AND EXTENDED COVERAGE INSURANCE, PROVIDED, HOWEVER, THE SUBJECT RELEASE
SHALL BE LIMITED BY THE TERMS AND PROVISIONS OF THE WAIVER OF SUBROGATION CLAUSE
AND SHALL BE CO-EXTENSIVE THEREWITH.

Section 4.03           Blanket Policies.  The insurance required by this Lease
may, at the option of Tenant, be effected by blanket or umbrella policies issued
to Tenant covering the Premises and other properties owned or leased by such
Tenant, provided that the policies otherwise comply with the provisions of this
Lease and allocate to the Premises and all improvements thereon and therein the
specified coverage, without possibility of reduction or coinsurance by reason
of, or damage to, any other premises named therein, and if the insurance
required by this Lease shall be effected by any such blanket or umbrella
policies, Tenant shall furnish to

5

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Landlord certificates of insurance for such policies, with schedules thereto
attached showing the amount of insurance afforded by such policies applicable to
the Premises in form and substance satisfactory to Landlord.

ARTICLE 5.
USE OF INSURANCE PROCEEDS

(A)           IF THE PREMISES OR IMPROVEMENTS THEREON OR THEREIN SHALL BE
DESTROYED OR DAMAGED IN WHOLE OR IN PART BY FIRE OR OTHER CASUALTY OF ANY KIND
OR NATURE, ORDINARY OR EXTRAORDINARY, FORESEEN OR UNFORESEEN (EACH, A
“CASUALTY”), TENANT SHALL GIVE TO LANDLORD PROMPT NOTICE THEREOF. TENANT MAY, AT
ITS ELECTION, REPAIR, ALTER, RESTORE, REPLACE AND REBUILD THE SAME, OR THE
FUNCTIONAL EQUIVALENT OF THE SAME AS WAS EXISTING IMMEDIATELY PRIOR TO SUCH
OCCURRENCE, SUBJECT TO SUCH CHANGES OR ALTERATIONS AS TENANT MAY ELECT. 
LANDLORD, IN NO EVENT, SHALL BE CALLED UPON TO RESTORE ANY PORTION OF THE
PREMISES OR IMPROVEMENTS, NOW OR HEREAFTER EXISTING OR ANY PORTION THEREOF OR TO
PAY ANY OF THE COSTS OR EXPENSES THEREOF.  IF TENANT SHALL ELECT NOT TO RESTORE
THE PREMISES OR IMPROVEMENTS, TENANT SHALL PROMPTLY GIVE NOTICE TO LANDLORD OF
ITS ELECTION NOT TO RESTORE.

(B)           ALL INSURANCE PROCEEDS PAYABLE AS A RESULT OF A CASUALTY WILL BE
PAID DIRECTLY TO TENANT.

ARTICLE 6.
CONDEMNATION

Section 6.01           Total Condemnation.

(A)           IF AT ANY TIME DURING THE TERM, THE WHOLE OR SUBSTANTIALLY ALL OF
THE PREMISES SHALL BE TAKEN FOR ANY PUBLIC OR QUASI-PUBLIC PURPOSE BY ANY LAWFUL
POWER OR AUTHORITY BY THE EXERCISE OF THE RIGHT OF CONDEMNATION OR EMINENT
DOMAIN OR BY AGREEMENT AMONG LANDLORD, TENANT AND THOSE AUTHORIZED TO EXERCISE
SUCH RIGHT, THIS LEASE AND THE TERM, SHALL TERMINATE AND EXPIRE ON THE DATE OF
SUCH TAKING AND THE RENT PAYABLE BY TENANT HEREUNDER SHALL BE PAID TO THE DATE
OF SUCH TAKING.

(B)           THE TERM “SUBSTANTIALLY ALL OF THE PREMISES” SHALL BE DEEMED TO
MEAN SUCH PORTION OF THE PREMISES AS, WHEN SO TAKEN, WOULD LEAVE REMAINING A
BALANCE OF THE PREMISES WHICH, DUE EITHER TO THE AREA SO TAKEN OR THE LOCATION
OF THE PART SO TAKEN IN RELATION TO THE PART NOT SO TAKEN, WOULD NOT UNDER
ECONOMIC CONDITIONS, ZONING LAWS OR BUILDING REGULATIONS THEN EXISTING OR
PREVAILING, READILY ACCOMMODATE, IN TENANT’S JUDGMENT, A NEW BUILDING OR
BUILDINGS OF A NATURE SIMILAR TO THE IMPROVEMENTS EXISTING AT THE DATE OF SUCH
TAKING AND AFTER PERFORMANCE OF ALL COVENANTS, AGREEMENTS, TERMS AND PROVISIONS
HEREIN AND BY LAW PROVIDED TO BE PERFORMED AND PAID BY TENANT.

Section 6.02           Award to Landlord.

(A)           IF THE WHOLE OR SUBSTANTIALLY ALL OF THE PREMISES SHALL BE TAKEN
OR CONDEMNED AS PROVIDED IN THIS ARTICLE 6, THE AWARD FOR OR ATTRIBUTABLE TO THE
PREMISES IN ANY PROCEEDING WITH RESPECT TO SUCH TAKING SHALL BE PAID TO
LANDLORD.

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(B)           TENANT AND LANDLORD AGREE TO EXECUTE ANY AND ALL DOCUMENTS AND
PERFORM ANY REQUISITE ACTS IN ORDER TO FACILITATE SUCH COLLECTION OF THE AWARD.

Section 6.03           Date of Taking.  For purposes of this Article 6, the
“date of taking” shall be deemed to be the date on which the whole or
substantially all of the Premises, or a part thereof, as the case may be, shall
have vested in any lawful power or authority of the government of the United
States of America or such other governmental authority having jurisdiction.

Section 6.04           Partial Condemnation.  If less than substantially all of
the Premises be so taken, all of the terms and provisions of Sections (a) and
(b) of Article 5 shall be fully applicable hereto respecting Tenant’s election
regarding restoration and payment of the condemnation award.

ARTICLE 7.
ASSIGNMENT, SUBLETTING AND MORTGAGES

Section 7.01           Restrictions on Right of Tenant to Transfer Lease. 
Tenant may assign or transfer this Lease, or sublet the Premises in its entirety
or substantially in its entirety, or portions thereof, without the prior written
consent of Landlord in each instance, provided, however that in all events
Tenant shall provide Landlord a true and correct copy of the documentation
evidencing such assignment, sublease or transfer within thirty (30) days of the
execution and completion thereof.  Tenant may also from time to time enter into
a venture with a third party or parties to perform a business operation at the
Premises. The foregoing in no way modifies Tenant’s obligation under this Lease
Agreement.

Section 7.02           Leasehold Mortgage.

(A)           TENANT MAY ENCUMBER BY MORTGAGE, MORTGAGES OR OTHER PROPER
INSTRUMENTS THIS LEASE AND TENANT’S LEASEHOLD INTEREST IN THE PREMISES AS
SECURITY FOR ANY INDEBTEDNESS UNDERTAKEN BY TENANT (EACH, A “LEASEHOLD
MORTGAGE”). THE EXECUTION OF A LEASEHOLD MORTGAGE OR OTHER SIMILAR INSTRUMENT,
OR THE FORECLOSURE THEREOF, OR ANY SALE THEREUNDER, EITHER BY JUDICIAL
PROCEEDINGS OR BY VIRTUE OF ANY POWER RESERVED IN A LEASEHOLD MORTGAGE, OR
CONVEYANCE BY TENANT TO THE HOLDER OF SUCH INDEBTEDNESS (EACH, A “HOLDER OF
LEASEHOLD MORTGAGE”), OR THE EXERCISING OF ANY RIGHT, POWER OR PRIVILEGE
RESERVED IN A LEASEHOLD MORTGAGE, SHALL NOT BE HELD AS A VIOLATION OF ANY OF THE
TERMS AND CONDITIONS HEREOF, OR AS AN ASSUMPTION BY THE HOLDER OF LEASEHOLD
MORTGAGE OR ITS DESIGNEE PERSONALLY OF THE OBLIGATIONS HEREOF, EXCEPT TO THE
EXTENT THAT THE HOLDER OF LEASEHOLD MORTGAGE OR ITS DESIGNEE VOLUNTARILY ASSUMES
SAID OBLIGATIONS IN ORDER TO AVOID TERMINATION OF THIS LEASE, PROVIDED THAT SUCH
LEASEHOLD MORTGAGE OR THE ACTIONS TAKEN PURSUANT THERETO SHALL NOT VIOLATE THE
FOLLOWING PROVISIONS OF THIS PARAGRAPH.

(B)           IF TENANT SHALL ENCUMBER THIS LEASE OR ITS LEASEHOLD INTEREST IN
THE PREMISES AND IF TENANT OR A HOLDER OF LEASEHOLD MORTGAGE SHALL GIVE WRITTEN
NOTICE TO LANDLORD OF THE EXISTENCE THEREOF AND THE ADDRESS OF SUCH HOLDER OF
LEASEHOLD MORTGAGE, THEN LANDLORD WILL MAIL OR DELIVER TO EACH SUCH HOLDER OF
LEASEHOLD MORTGAGE, AT SUCH ADDRESS, A DUPLICATE COPY OF ALL NOTICES IN WRITING
WHICH LANDLORD MAY, FROM TIME TO TIME, GIVE TO OR SERVE ON TENANT UNDER AND
PURSUANT TO THE TERMS AND PROVISIONS HEREOF, SUCH COPIES SHALL BE MAILED OR
DELIVERED

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TO EACH SUCH HOLDER OF LEASEHOLD MORTGAGE, AT, OR AS NEAR AS POSSIBLE TO, THE
SAME TIME SUCH NOTICES ARE GIVEN TO OR SERVED ON TENANT. EACH SUCH HOLDER OF
LEASEHOLD MORTGAGE MAY, AT ITS OPTION, AT ANY TIME BEFORE THE RIGHTS OF TENANT
SHALL BE TERMINATED AS PROVIDED HEREIN, PAY ANY OF THE RENTS DUE HEREUNDER, OR
PAY ANY TAXES AND ASSESSMENTS, OR DO ANY ACT OR THING REQUIRED OF TENANT BY THE
TERMS HEREOF, OR DO ANY ACT OR THING THAT MAY BE NECESSARY AND PROPER TO BE DONE
IN THE OBSERVANCE OF THE COVENANTS AND CONDITIONS HEREOF, OR TO PREVENT THE
TERMINATION HEREOF, ALL PAYMENTS SO MADE, AND ALL THINGS SO DONE AND PERFORMED
BY SUCH HOLDER OF LEASEHOLD MORTGAGE SHALL BE AS EFFECTIVE TO PREVENT A
TERMINATION OF THE RIGHTS OF TENANT HEREUNDER AS THE SAME WOULD HAVE BEEN IF
DONE AND PERFORMED BY TENANT.

(C)           LANDLORD AGREES THAT IT WILL NOT TERMINATE THIS LEASE BECAUSE OF
THE BANKRUPTCY OR INSOLVENCY OF THE TENANT, OR BECAUSE THE TENANT SHALL ABANDON
THE PREMISES, OR BECAUSE THE TENANT SHALL SUFFER THIS LEASE OR ANY ESTATE OR
INTEREST THEREUNDER TO BE TAKEN UNDER ANY WRIT OF EXECUTION, OR BECAUSE THE
TENANT SHALL MAKE AN ASSIGNMENT FOR THE BENEFIT OF CREDITORS, OR BECAUSE OF ANY
OTHER FAILURE ON THE PART OF TENANT TO OBSERVE OR PERFORM ANY OF THE COVENANTS
CONTAINED IN THIS LEASE, IF A HOLDER OF LEASEHOLD MORTGAGE CURES ANY DEFAULT BY
TENANT WHICH IS CURABLE BY THE PAYMENT OF MONEY WITHIN THIRTY (30) DAYS AFTER
THE DATE OF WRITTEN NOTICE FROM LANDLORD TO EACH HOLDER OF LEASEHOLD MORTGAGE
SPECIFYING THE NATURE OF THE DEFAULT, OR IF SUCH DEFAULT IS NOT CURABLE BY THE
MERE PAYMENT OF MONEY, THEN IF A HOLDER OF LEASEHOLD MORTGAGE SHALL AGREE IN
WRITING TO PERFORM (AND DOES PERFORM) WITHIN NINETY (90) DAYS AFTER THE DATE OF
THE WRITTEN NOTICE OF DEFAULT FROM LANDLORD TO EACH HOLDER OF LEASEHOLD MORTGAGE
SPECIFYING THE NATURE OF THE DEFAULT ALL OF THE OBLIGATIONS OF TENANT UNDER THIS
LEASE CAPABLE OF PERFORMANCE BY A HOLDER OF LEASEHOLD MORTGAGE UNTIL SUCH TIME
AS THIS LEASE SHALL BE SOLD UPON FORECLOSURE PURSUANT TO THE PROVISIONS OF THE
LEASEHOLD MORTGAGE. PROVIDED THAT A HOLDER OF LEASEHOLD MORTGAGE PAYS ALL
AMOUNTS THEN DUE AND PAYABLE ON THE PART OF THE TENANT, INCLUDING INTEREST AND
ALL LATE PENALTIES, AND LANDLORD’S LEGAL FEES INCURRED AS A RESULT OF TENANT’S
DEFAULT, LANDLORD AGREES TO ACCEPT PERFORMANCE BY SUCH HOLDER OF LEASEHOLD
MORTGAGE OF ANY TERM, COVENANT OR CONDITION TO BE PERFORMED BY TENANT UNDER THIS
LEASE WITH THE SAME FORCE AND EFFECT AS THOUGH TIMELY PERFORMED BY TENANT AS
LONG AS SUCH HOLDER OF LEASEHOLD MORTGAGE PERFORMS WITHIN THE TIME PERIODS
PREVIOUSLY SET FORTH IN THIS SUBPARAGRAPH. IF A HOLDER OF LEASEHOLD MORTGAGE
FAILS TO CURE ANY TENANT DEFAULT IN ACCORD WITH THE FOREGOING, LANDLORD MAY
TERMINATE THIS LEASE AND PROCEED WITH ALL AVAILABLE REMEDIES TO TAKE POSSESSION
OF THE PREMISES AND ALL OTHER RIGHTS PERTAINING THERETO, AS SET FORTH IN THE
PROVISIONS GOVERNING DEFAULT UNDER THIS LEASE. WHEN MORE THAN ONE HOLDER OF
LEASEHOLD MORTGAGE EXISTS, THE RIGHTS AND INTERESTS OF EACH HOLDER OF LEASEHOLD
MORTGAGE UNDER THIS LEASE SHALL BE DETERMINED BY THE PRIORITY OF EACH SUCH
HOLDER OF LEASEHOLD MORTGAGE AND AS SUCH RIGHTS AND INTERESTS MAY BE RESTRICTED
OR OTHERWISE ALLOCATED PURSUANT TO ANY AGREEMENT(S) BETWEEN SUCH HOLDERS OF
LEASEHOLD MORTGAGE OR BETWEEN TENANT AND SUCH HOLDER(S) OF LEASEHOLD MORTGAGE.
NOTWITHSTANDING ANY SUCH AGREEMENT(S), LANDLORD IS REQUIRED TO GIVE ANY NOTICE
REQUIRED HEREUNDER TO ALL HOLDERS OF LEASEHOLD MORTGAGE OF WHICH LANDLORD HAS
BEEN GIVEN WRITTEN NOTICE. LANDLORD ACKNOWLEDGES THAT SOME TENANT DEFAULTS MAY
NOT BE CAPABLE OF CURE BY A HOLDER OF LEASEHOLD MORTGAGE, SUCH AS THE BANKRUPTCY
OF THE TENANT. LANDLORD AGREES THAT TENANT DEFAULTS WHICH ARE BY THEIR NATURE
IMPOSSIBLE TO CURE BY A HOLDER OF LEASEHOLD MORTGAGE SHALL NOT BE DEEMED A BASIS
FOR TERMINATION OF THIS LEASE SO LONG AS ALL OTHER DEFAULTS WHICH ARE CAPABLE OF
CURE ARE CURED IN ACCORDANCE WITH THIS SECTION.

(D)           LANDLORD AGREES THAT THIS LEASE SHALL NOT BE HEREAFTER MODIFIED OR
AMENDED WITHOUT THE PRIOR WRITTEN CONSENT OF EACH HOLDER OF LEASEHOLD MORTGAGE
TO:

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(I)            INCREASE THE ANNUAL RENT OR ADDITIONAL RENT (EXCEPT WITH REGARD
TO INCREASES NOW PROVIDED IN THE LEASE);

(II)           CHANGE THE LEGAL DESCRIPTION OF THE PREMISES FROM THAT NOW SET
FORTH IN THIS LEASE;

(III)          SHORTEN THE TERM OR ANY RENEWAL TERM OF THIS LEASE, EXCEPT AS NOW
PERMITTED BY THIS LEASE;

(IV)          CHANGE THE PERMITTED USE OF THE PREMISES; OR

(V)           IMPOSE ANY ADDITIONAL OBLIGATIONS UPON TENANT.

Landlord further covenants and agrees not to accept a surrender of the Premises
or a cancellation or release of this Lease from Tenant (except pursuant to the
exercise of Landlord’s remedies provided herein if an event of default occurs)
prior to the expiration or earlier termination thereof without the prior written
consent of each Holder of Leasehold Mortgage.

(E)           IF LANDLORD EXERCISES LANDLORD’S RIGHT TO TERMINATE THIS LEASE AS
PROVIDED IN ARTICLE 20 HEREOF, THEN EACH HOLDER OF LEASEHOLD MORTGAGE SHALL HAVE
THE RIGHT TO NOTIFY LANDLORD IN WRITING, WITHIN THIRTY (30) DAYS AFTER THE
EFFECTIVE DATE OF WRITTEN NOTICE FROM LANDLORD TO EACH HOLDER OF LEASEHOLD
MORTGAGE, THAT SUCH ONE OR MORE HOLDERS OF LEASEHOLD MORTGAGE OR ANY DESIGNEE OR
NOMINEE THEREOF ELECTS TO LEASE THE PREMISES FROM THE DATE OF SUCH TERMINATION
OF THIS LEASE FOR THE REMAINDER OF THE SCHEDULED TERM OF THIS LEASE, INCLUDING
THE OPTION TERMS, AT THE RENT AND UPON THE OTHER SAME TERMS, COVENANTS AND
CONDITIONS THAT ARE HEREIN SET FORTH, WITH THE SAME RELATIVE PRIORITY AS THIS
LEASE AND HAVING THE BENEFIT OF INVESTING IN SUCH ONE OR MORE HOLDER(S) OF
LEASEHOLD MORTGAGE OR ANY DESIGNEE OR NOMINEE THEREOF OF ALL OF THE RIGHTS,
TITLE, INTERESTS, POWERS AND PRIVILEGES OF TENANT HEREUNDER. IF SUCH ONE OR MORE
HOLDER(S) OF LEASEHOLD MORTGAGE ELECTS TO OBTAIN SUCH NEW LEASE, THEN SUCH
HOLDER(S) OF LEASEHOLD MORTGAGE SHALL BE OBLIGATED, WITHIN THIRTY (30) DAYS
AFTER DELIVERY TO LANDLORD OF SUCH NOTICE OF ELECTION, TO (I) CURE THE DEFAULT
UPON WHICH SUCH TERMINATION WAS BASED, OR IN RESPECT TO ANY DEFAULT NOT CAPABLE
OF BEING CURED WITHIN SUCH THIRTY (30) DAY TIME PERIOD OR WHICH CANNOT BE CURED
WITHOUT ENTRY AND POSSESSION TO PROCEED AND EFFECTUATE SUCH CURE WITH DUE
DILIGENCE FOLLOWING DELIVERY OF POSSESSION (EXCLUDING, HOWEVER, TENANT DEFAULTS
WHICH BY THEIR NATURE ARE IMPOSSIBLE TO CURE); (II) PAY TO LANDLORD ALL ANNUAL
RENT  INCLUDING INTEREST, ALL LATE PENALTIES, AND ALL ITEMS OF ADDITIONAL RENT
DUE AND PAYABLE UNDER THIS LEASE UP TO AND INCLUDING THE DATE OF COMMENCEMENT OF
THE TERM OF SUCH NEW LEASE; AND (III) PAY TO LANDLORD ALL EXPENSES AND
REASONABLE ATTORNEY’S FEES INCURRED BY LANDLORD IN CONNECTION WITH ANY SUCH
DEFAULT AND TERMINATION AND WITH THE PREPARATION, EXECUTION AND DELIVERY OF SUCH
NEW LEASE.  UPON SUCH PERFORMANCE BY SUCH ONE OR MORE HOLDER(S) OF LEASEHOLD
MORTGAGE OR ANY DESIGNEE OR NOMINEE THEREOF, SUCH PARTIES SHALL HAVE THE SAME
RELATIVE PRIORITY AS THIS LEASE AND HAVING THE BENEFIT OF ALL THE RIGHTS,
TITLES, INTERESTS, POWERS AND PRIVILEGES OF TENANT HEREUNDER, INCLUDING,
SPECIFICALLY, AUTOMATIC VESTING OF TITLE TO ALL IMPROVEMENTS AS WELL AS ALL
EQUIPMENT, FIXTURES AND MACHINERY THEREIN, UNTIL THE EXPIRATION OF THE TERM OF
THIS LEASE UNLESS THIS LEASE SHALL THEREAFTER BE SOONER TERMINATED. SUCH
HOLDER(S) OF LEASEHOLD MORTGAGE OR ANY DESIGNEE OR NOMINEE THEREOF SHALL BE
OBLIGATED UNDER SUCH NEW LEASE AND AGREE IN WRITING THAT PROMPTLY FOLLOWING THE
DELIVERY OF THE NEW LEASE, SUCH HOLDER(S) OF LEASEHOLD MORTGAGE OR ITS DESIGNEE
WILL PERFORM OR CAUSE TO BE PERFORMED ALL OF THE OTHER COVENANTS AND AGREEMENTS
HEREIN CONTAINED ON TENANT’S PART TO BE PERFORMED.

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(F)            UNLESS EXCUSED BY LANDLORD, IF ANY ASSIGNEE OR TRANSFEREE OF A
HOLDER OF LEASEHOLD MORTGAGE OR NEW LESSEE DERIVING RIGHTS FROM THE HOLDER OF
LEASEHOLD MORTGAGE FAILS TO CURE ANY OF THE TENANT’S DEFAULTS WITHIN ONE HUNDRED
TWENTY (120) DAYS FROM THE EFFECTIVE DATE OF SUCH ASSIGNMENT, TRANSFER OR NEW
LEASE, THIS LEASE AND THE LEASE RIGHTS HEREUNDER AND UNDER ANY SUCH NEW LEASE
SHALL TERMINATE FORTHWITH AT LANDLORD’S OPTION AND IN LANDLORD’S SOLE AND
ABSOLUTE DISCRETION, SUCH OPTION TO BE EXERCISED BY SENDING WRITTEN NOTICE TO
THE ASSIGNEE OR TRANSFEREE THAT THE NEW LEASE HAS BEEN TERMINATED PURSUANT TO
THIS PROVISION.

(G)           LANDLORD AGREES TO EXECUTE AND DELIVER ANY AND ALL CONSENTS AND
OTHER DOCUMENTS (INCLUDING REASONABLE MODIFICATIONS TO THIS LEASE) REASONABLY
REQUESTED BY TENANT AND/OR ONE OR MORE HOLDER(S) OF LEASEHOLD MORTGAGE SO LONG
AS SUCH DOCUMENTS ARE REASONABLY CONSISTENT WITH THE PROVISIONS OF THIS SECTION
7.02.

(H)           NOTWITHSTANDING ANY PROVISION IN THIS ARTICLE 7 OR ELSEWHERE IN
THIS LEASE TO THE CONTRARY, TENANT MAY, IN ITS SOLE DISCRETION, ENTER INTO LEASE
FINANCING, CONVENTIONAL FINANCING AND OTHER ARRANGEMENTS IN CONNECTION WITH THE
ACQUISITION, LEASE AND DISPOSAL OF THE EQUIPMENT AND/OR PERSONAL PROPERTY
INCLUDING, WITHOUT LIMITATION, LEASING OF EQUIPMENT AND/OR PERSONAL PROPERTY
FROM ANOTHER WITH AN OPTION TO PURCHASE AT THE END OF THE LEASE TERM AND
ASSIGNMENT OF TENANT’S INTERESTS IN THE EQUIPMENT AND/OR PERSONAL PROPERTY, IF
REQUIRED, AS SECURITY FOR THESE TRANSACTIONS.

(I)            NOTHING HEREIN SHALL BE DEEMED TO RELIEVE, IMPAIR, RELEASE, OR
DISCHARGE TENANT OF ITS OBLIGATIONS TO FULLY PERFORM THE TERMS OF THIS LEASE ON
TENANT’S PART TO BE PERFORMED.

(J)            NOTWITHSTANDING ANY PROVISION IN THIS ARTICLE 7 OR ELSEWHERE IN
THIS LEASE TO THE CONTRARY, TENANT MAY, IN ITS SOLE DISCRETION AND WITHOUT THE
CONSENT OF LANDLORD ENTER INTO ANY FINANCING AND OTHER ARRANGEMENTS WHICH DO NOT
CREATE A LIEN ON THE LEASEHOLD ESTATE CREATED HEREBY, INCLUDING WITHOUT
LIMITATION, PLEDGES OF PROCEEDS FROM ALL USES OF THE PREMISES AS PROVIDED IN
THIS LEASE.

(K)           AS USED HEREIN:

“Person” shall mean and include an individual, corporation, partnership, joint
venture, trust, unincorporated association and any federal, state, county or
municipal government or any bureau, department or agency thereof.

Section 7.03           Obligations of Subtenants.  To the extent applicable,
Tenant shall use good faith efforts to cause the subtenants, operators,
licensees, concessionaires and other occupants of the Premises (collectively
“Subtenants”) to comply with (a) all of Tenant’s obligations under this Lease,
with respect to the space covered by the Subtenants’ sublease (hereinafter
defined), and (b) their obligations under their subleases, occupancy, license
and concession agreements (collectively “Subleases”), and Tenant shall
diligently enforce all of the rights of the Landlord thereunder in accordance
with the terms of such Subleases.  Landlord hereby agrees that all permitted
assignments, sublets and subsublets shall have the benefit of

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nondisturbance and attornment as between any assignee, sublessee or subsublessee
and Landlord, either pursuant to provisions set forth in such assignments,
subleases or subsubleases or by virtue of separate nondisturbance and attornment
agreements containing customary terms and conditions, which Landlord hereby
agrees to execute within ten (10) days of receipt of written request.

Section 7.04           Tenant’s Obligation to Cure.  The fact that a violation
or breach of any of the terms, provisions or conditions of this Lease results
from or is caused by an act or omission by any of the Subtenants shall not
relieve Tenant of Tenant’s obligation to cure the same. Tenant shall promptly
take steps to cause any such violation or breach to be cured.  Landlord hereby
acknowledges that so long as Tenant promptly takes steps to cause any such
violation or breach to be cured and diligently pursues the same until cured,
such violation or breach by any of the Subtenants shall not constitute grounds
for termination of this Lease.

Section 7.05           No Waiver.  Landlord, after Default (as hereinafter
defined) by Tenant, may collect rent and all other sums due under Subleases, and
apply the net amount collected to the Rent payable by Tenant hereunder, but no
such collection shall be, or be deemed to be, a waiver of any agreement, term,
covenant or condition of this Lease or the acceptance by Landlord of any
Subtenants as Tenant hereunder, or a release of Tenant from performance by
Tenant of its obligations under this Lease.

SECTION 7.06           INTENTIONALLY OMITTED.

Section 7.07           Tenant’s Use.  Notwithstanding Tenant’s rights to enter
into subleases of the Premises, Tenant shall throughout the term of this Lease
Agreement, use or cause the Premises to be used as agreed between Landlord and
Tenant.  The parties hereby acknowledge that Tenant will not use or cause to be
used any part of the Premises for any unlawful conduct or purpose.

Section 7.08           Mortgage or other Security Agreement Requirements.  No
mortgage or other security agreement shall be valid or of any force or effect
respecting the Landlord unless and until a true copy of the original of each
instrument creating and effecting such mortgage or other security agreement,
certified by Tenant to be a true copy of such instrument, and written notice
containing the name and post office address of the Mortgagee, shall have been
delivered to Landlord, and the mortgage or other security agreement shall
contain substantially the following provisions:

“(1) The Mortgagee agrees to send the Landlord under said Lease copies of all
notices to the Mortgagor in which the Mortgagee claims that there exists one or
more defaults under the terms and provisions of this Mortgage; said copy to be
sent to the Landlord under said Lease simultaneously with its being sent to the
Mortgagor.”

Section 7.09           Mortgagee; Arbitration.  Landlord agrees that Landlord
will give any Mortgagee who shall have given Landlord a notice as provided in
Section 7.10 hereof notice of any demand by Landlord for any arbitration, and
Landlord will recognize such Mortgagee as a proper party to participate in the
arbitration.

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Section 7.10           Landlord to Join in Tenant Mortgage.  Anything to the
contrary in the foregoing provisions of this Article 7 notwithstanding, in the
event Tenant shall request Landlord, in writing, to join in any mortgage, lien,
pledge, grant, assignment, hypothecation or such other conveyance, encumbering
Tenant’s estate in the Premises for any term, Landlord shall, at no cost or
expense to Landlord, execute, acknowledge and join in such mortgage.  Such
mortgage shall, however, be fully non-recourse to Landlord and all of the
provisions of Article 14 of this Lease respecting the non-liability and
indemnification of Landlord shall be fully applicable with respect thereto.  The
provisions of the mortgage specifying the non-recourse nature thereof with
respect to Landlord shall be satisfactory to Landlord.

ARTICLE 8.
INTENTIONALLY OMITTED

ARTICLE 9.
WASTE AND DAMAGE TO PREMISES

Section 9.01           Tenant’s Obligations.  Tenant, shall not commit or
suffer, and shall use all reasonable precaution to prevent waste, damage, or
injury to the Premises (including from environmental contamination).

Section 9.02           No Landlord Services.  Landlord shall not be required to
furnish any services, utilities or facilities whatsoever to the Premises. 
Landlord shall have no duty or obligation to make any alteration, change,
improvement, replacement, restoration or repair to, or to demolish, any
improvements.  Tenant assumes the full and sole responsibility for the
condition, operation, repair, alteration, improvement, replacement, maintenance
and management of the Premises and all improvements thereon and therein.

ARTICLE 10.
CHANGES, ALTERATIONS AND ADDITIONS

TENANT MAY ALTER THE IMPROVEMENTS AT THE PREMISES, OR ANY PART THEREOF, WITHOUT
THE CONSENT OF THE LANDLORD, OR MAKE ANY ADDITION THERETO OR CONSTRUCT ANY
IMPROVEMENTS ON THE PREMISES OR DESTROY ANY EXISTING IMPROVEMENTS, WHETHER
VOLUNTARILY OR IN CONNECTION WITH A REPAIR OR RESTORATION REQUIRED BY THIS LEASE
(COLLECTIVELY, “CAPITAL IMPROVEMENTS”), SUBJECT TO THE FOLLOWING:

(A)           IF ANY CONTEMPLATED CAPITAL IMPROVEMENT SHALL NOT BE COVERED BY
TENANT’S INSURANCE POLICIES, THEN NO SUCH CAPITAL IMPROVEMENT SHALL BE
UNDERTAKEN UNTIL TENANT SHALL HAVE DELIVERED TO LANDLORD INSURANCE POLICIES OR
CERTIFICATES OR MEMORANDA THEREFOR ISSUED BY RESPONSIBLE INSURERS, BEARING
NOTATIONS EVIDENCING THE PAYMENT OF PREMIUMS OR ACCOMPANIED BY OTHER EVIDENCE
SATISFACTORY TO LANDLORD OF SUCH PAYMENTS, FOR THE INSURANCE REQUIRED BY ARTICLE
4 HEREOF.  IF UNDER THE PROVISIONS OF ANY CASUALTY, LIABILITY OR OTHER INSURANCE
POLICY OR POLICIES THEN COVERING THE PREMISES OR ANY PART THEREOF ANY CONSENT TO
SUCH CAPITAL IMPROVEMENT BY THE INSURANCE COMPANY OR COMPANIES ISSUING SUCH
POLICY OR POLICIES SHALL BE REQUIRED TO CONTINUE AND KEEP SUCH POLICY OR
POLICIES IN FULL FORCE AND EFFECT, TENANT SHALL OBTAIN SUCH CONSENTS AND

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PAY ANY ADDITIONAL PREMIUMS OR CHARGES THEREFOR THAT MAY BE IMPOSED BY SAID
INSURANCE COMPANY OR COMPANIES PRIOR TO THE COMMENCEMENT OF THE CAPITAL
IMPROVEMENT, ALL OF WHICH SHALL BE CARRIED OUT UNDER THE SUPERVISION OF A DULY
LICENSED ARCHITECT OR ENGINEER SELECTED BY TENANT.

(B)           UPON THE EXPIRATION OR EARLIER TERMINATION OF THIS LEASE
AGREEMENT, SUBJECT TO ANY THEN-EXISTING COMMITMENTS, ALL CAPITAL IMPROVEMENTS TO
ALL OR ANY PORTION OF ANY OF THE PREMISES SHALL IMMEDIATELY BECOME THE PROPERTY
OF LANDLORD, AND TENANT AGREES TO FULLY COOPERATE WITH LANDLORD IN ALL REQUESTS
MADE BY LANDLORD IN CONNECTION WITH THE IMMEDIATE TRANSFER OF ALL SUCH
IMPROVEMENTS TO THE LANDLORD.

ARTICLE 11.
REQUIREMENTS OF PUBLIC AUTHORITIES AND
OF INSURANCE UNDERWRITERS AND POLICIES

Tenant, at its sole cost and expense, promptly shall use all reasonable efforts
to utilize the Premises in a manner consistent with any and all present and
future laws, rules, orders, ordinances, regulations, statutes, requirements,
codes and executive orders (collectively “Requirements”) without regard to the
nature of the work required to be done, extraordinary as well as ordinary, of
any governmental authority having jurisdiction, now existing or hereafter
created, and of any and all of their departments and bureaus, and of any
applicable fire rating bureau or other body exercising similar functions,
affecting the Premises, or any street, avenue and/or sidewalk comprising a part
or in front thereof and/or any vault in or under the same, or requiring the
removal of any encroachment, or affecting the maintenance, use or occupation of
the Premises.  Tenant also shall use good faith efforts to comply with any and
all provisions and requirements of any casualty, liability or other insurance
policy required to be carried by Tenant under the provisions of this Lease. 
Nothing herein shall prevent Tenant from contesting the validity of any
Requirement in accordance with existing law.  Notwithstanding anything in this
Lease Agreement to the contrary, the parties hereby acknowledge that the Nation
and SEGC are subject only to Requirements of the Seneca Nation and that the
Nation and SEGC voluntarily comply with certain Requirements of the Seneca
Nation and the federal government of the United States.

ARTICLE 12.
INTENTIONALLY OMITTED

ARTICLE 13.
DISCHARGE OF LIENS

Section 13.01         Discharge of Liens.  Except for any customary utility
easements, restrictive easement agreements, Mortgages or otherwise set forth in
Section 7.02, neither Landlord nor Tenant shall create or permit to be created
any lien, encumbrance or charge upon the Land and shall not suffer any other
matter or thing whereby the estate, rights and interest of Landlord in the
Premises or any part thereof might be materially impaired.

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Section 13.02         Tenant Indemnity for Liens.  Tenant shall indemnify and
hold Landlord harmless from and against any and all costs, expenses, liability
or damages arising from or, in connection with, the performance of any labor or
the furnishing of any materials for any specific improvement, alteration to or
repair of the Premises or any part thereof, or the furnishing of materials or
the rendering of services that would give rise to the filing of any lien against
the Premises or any part thereof.

ARTICLE 14.
LIMITED OBLIGATIONS OF THE PARTIES; INDEMNITY

Section 14.01         Tenant Accepts “As Is”.  Tenant acknowledges that Landlord
has not operated or maintained the Premises and that Tenant is fully familiar
with the Premises, the physical condition thereof and title matters.  Tenant
accepts the Premises “as is”, in the existing condition and state of repair.

Section 14.02         No Landlord Representations.  Tenant acknowledges with
respect to the transaction pursuant to which Landlord has acquired its interest
in the Premises and leased the same to Tenant that it has not relied on any
representations, statements or warranties made by Landlord and that Landlord
shall not, in any event whatsoever, be liable by reason of any such claimed
misrepresentation or breach of warranty or for any latent or patent defects in
the Premises.

Section 14.03         No Landlord Liability/Indemnification.

(A)           ALL COVENANTS, STIPULATIONS, PROMISES, AGREEMENTS AND OBLIGATIONS
OF LANDLORD CONTAINED IN THIS LEASE AGREEMENT SHALL BE DEEMED TO BE THE
COVENANTS, STIPULATIONS, PROMISES, AGREEMENTS AND OBLIGATIONS OF THE LANDLORD
AND NOT OF ANY MEMBER, OFFICER, AGENT, SERVANT OR EMPLOYEE OF THE LANDLORD IN
HIS OR HER INDIVIDUAL CAPACITY, AND NO RECOURSE UNDER OR UPON ANY OBLIGATION,
COVENANT OR AGREEMENT CONTAINED IN THIS LEASE AGREEMENT, OR OTHERWISE BASED OR
IN RESPECT OF THIS LEASE AGREEMENT, OR FOR ANY CLAIM BASED THEREON OR OTHERWISE
IN RESPECT OF THIS LEASE AGREEMENT, SHALL BE HAD AGAINST ANY PAST, PRESENT OR
FUTURE MEMBER, OFFICER, AGENT, SERVANT OR EMPLOYEE, AS SUCH, OF THE LANDLORD OR
ANY SUCCESSOR PUBLIC BENEFIT CORPORATION OR POLITICAL SUBDIVISION OR ANY PERSON
EXECUTING THIS LEASE AGREEMENT ON BEHALF OF THE LANDLORD, EITHER DIRECTLY OR
THROUGH THE LANDLORD OR ANY SUCCESSOR PUBLIC BENEFIT CORPORATION OR POLITICAL
SUBDIVISION.  IT IS EXPRESSLY UNDERSTOOD THAT THIS LEASE AGREEMENT IS A
CORPORATE OBLIGATION, AND THAT NO SUCH PERSONAL LIABILITY WHATEVER SHALL ATTACH
TO, OR IS OR SHALL BE INCURRED BY, ANY SUCH MEMBER, OFFICER, AGENT, SERVANT OR
EMPLOYEE OF THE LANDLORD OR OF ANY SUCCESSOR PUBLIC BENEFIT CORPORATION OR
POLITICAL SUBDIVISION OR ANY PERSON SO EXECUTING THIS LEASE AGREEMENT UNDER OR
BY REASON OF THE OBLIGATIONS, COVENANTS OR AGREEMENTS CONTAINED IN THIS LEASE
AGREEMENT OR IMPLIED THEREFROM.  ANY AND ALL SUCH PERSONAL LIABILITY OF, AND ANY
AND ALL SUCH RIGHTS AND CLAIMS AGAINST, EVERY SUCH MEMBER, OFFICER, AGENT,
SERVANT OR EMPLOYEE UNDER OR BY REASON OF THE OBLIGATIONS, COVENANTS OR
AGREEMENTS CONTAINED IN THIS LEASE AGREEMENT OR IMPLIED THEREFROM ARE, TO THE
EXTENT PERMITTED BY LAW, EXPRESSLY WAIVED AND RELEASED AS A CONDITION OF, AND AS
A CONSIDERATION FOR, THE EXECUTION OF THIS LEASE AGREEMENT.

14

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(B)           THE OBLIGATIONS AND AGREEMENTS OF THE LANDLORD CONTAINED HEREIN
SHALL NOT CONSTITUTE OR GIVE RISE TO A GENERAL OBLIGATION OF THE LANDLORD, BUT
RATHER SHALL CONSTITUTE LIMITED OBLIGATIONS OF THE LANDLORD AS EXPRESSLY SET
FORTH IN THIS LEASE AGREEMENT.

(C)           TENANT SHALL AT ALL TIMES PROTECT AND HOLD THE LANDLORD HARMLESS
OF, FROM AND AGAINST ANY AND ALL CLAIMS (WHETHER IN TORT, CONTRACT OR
OTHERWISE), DEMANDS, EXPENSES AND LIABILITIES FOR LOSSES, DAMAGES, INJURY AND
LIABILITY OF EVERY KIND AND NATURE AND HOWEVER CAUSED, AND TAXES (OF ANY KIND
AND BY WHOMSOEVER IMPOSED), RESULTING FROM, ARISING OUT OF, OR IN ANY WAY
CONNECTED WITH THIS LEASE AGREEMENT OR THE PREMISES DESCRIBED HEREIN, OR THE
ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS HEREOF OR THEREOF OR THE
TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING, BUT NOT LIMITED TO:

(I)            THE REHABILITATION, RENOVATION AND CONSTRUCTION OF THE
IMPROVEMENTS, THE INSTALLATION OR REMOVAL OF ANY EQUIPMENT OR ANY OTHER WORK OR
THING DONE IN, ON OR ABOUT THE PREMISES OR ANY PART THEREOF;

(II)           ANY USE, NON-USE, POSSESSION, OCCUPATION, ALTERATION, REPAIR,
CONDITION, OPERATION, MAINTENANCE OR MANAGEMENT OF THE PREMISES OR ANY PART
THEREOF OR ADJACENT THERETO;

(III)          NEGLIGENCE ON THE PART OF TENANT OR ANY SUBTENANT OR ANY OF ITS
OR THEIR RESPECTIVE AGENTS, CONTRACTORS, SERVANTS, EMPLOYEES, LICENSEES OR
INVITEES;

(IV)          ANY ACCIDENT, INJURY (INCLUDING DEATH) OR DAMAGE TO ANY PERSON OR
PROPERTY OCCURRING IN, ON OR ABOUT THE PREMISES OR ANY PART THEREOF OR ADJACENT
THERETO;

(V)           ANY FAILURE ON THE PART OF TENANT TO PAY ANNUAL RENT OR TO PERFORM
OR COMPLY WITH ANY OF THE COVENANTS, AGREEMENTS, TERMS OR CONDITIONS CONTAINED
IN THIS LEASE ON ITS PART TO BE PERFORMED OR COMPLIED WITH AND THE EXERCISE BY
LANDLORD OF ANY REMEDY PROVIDED IN THIS LEASE WITH RESPECT THERETO; AND

(VI)          ANY LIEN OR CLAIM WHICH MAY BE ALLEGED TO HAVE ARISEN AGAINST OR
ON THE PREMISES OR ANY PART THEREOF OR ANY OF THE ASSETS OF, OR FUNDS
APPROPRIATED TO, LANDLORD, OR ANY LIABILITY WHICH MAY BE ASSERTED AGAINST
LANDLORD WITH RESPECT THERETO.

(D)           SUCH INDEMNIFICATION SET FORTH ABOVE SHALL BE BINDING UPON TENANT
FOR ANY AND ALL CLAIMS, DEMANDS, EXPENSES, LIABILITIES AND TAXES SET FORTH
HEREIN.  THE LANDLORD SHALL NOT BE LIABLE FOR ANY DAMAGES OR INJURY TO THE
PERSON OR PROPERTY OF TENANT OR ITS TRUSTEES, OFFICERS, EMPLOYEES, AGENTS OR
SERVANTS OR PERSONS UNDER THE CONTROL OR SUPERVISION OF TENANT OR ANY OTHER
PERSON WHO MAY BE ABOUT THE PREMISES, DUE TO ANY ACT OR NEGLIGENCE OF ANY
PERSON, OTHER THAN WITH RESPECT TO THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
THE LANDLORD.  IF ANY CLAIM, ACTION OR PROCEEDING RELATING TO THE PREMISES IS
MADE OR BROUGHT AGAINST LANDLORD, THEN, UPON DEMAND BY LANDLORD, TENANT, AT ITS
SOLE COST AND EXPENSE, SHALL RESIST OR DEFEND SUCH CLAIM, ACTION OR PROCEEDING
IN LANDLORD’S OR TENANT’S NAME, IF NECESSARY, BY THE ATTORNEYS FOR TENANT’S
INSURANCE CARRIER (IF SUCH CLAIM, ACTION OR PROCEEDING IS COVERED BY INSURANCE),
OTHERWISE BY SUCH ATTORNEYS SELECTED BY TENANT AS LANDLORD SHALL REASONABLY
APPROVE, WHICH APPROVAL SHALL NOT BE

15

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UNREASONABLY WITHHELD OR DELAYED.  NOTWITHSTANDING THE FOREGOING, IF LANDLORD
REASONABLY DETERMINES THAT IT IS APPROPRIATE TO ENGAGE ITS OWN ATTORNEYS THEN
LANDLORD, AFTER CONSULTATION WITH TENANT, MAY ENGAGE ITS OWN ATTORNEYS TO DEFEND
IT OR TO ASSIST IN ITS DEFENSE AND TENANT SHALL PAY THE REASONABLE FEES AND
DISBURSEMENTS OF SUCH ATTORNEYS BUT LANDLORD MAY NOT ENTER INTO ANY SETTLEMENT
OF THE CLAIM, ACTION OR PROCEEDING WITHOUT THE PRIOR WRITTEN CONSENT OF TENANT
WHICH MAY BE GIVEN OR WITHHELD AT TENANT’S SOLE AND ABSOLUTE DISCRETION.

Section 14.04         Tenant Indemnity; Insurance.  The obligations of Tenant
under this Article 14 shall not be affected in any way by the absence of
insurance or by the failure or refusal of any insurance carrier to perform any
obligation on its part under insurance policies affecting the Premises.

Section 14.05         Survival.  The terms and conditions of this Article 14
shall survive the expiration or earlier termination of this Lease Agreement.

Section 14.06         No Consequential Damages.  In no event shall either party
be liable for consequential, incidental or special damages under this Lease
Agreement.

ARTICLE 15.
LANDLORD NOT LIABLE FOR INJURY OR DAMAGE, ETC.

Landlord shall not in any event whatsoever be liable for any injury or damage to
Tenant (unless caused by the gross negligence or willful misconduct of Landlord,
its agents, servants or employees) or to any other Person happening on, in or
about the Premises and its appurtenances, nor for any injury or damage to the
Premises or to any property belonging to Tenant (unless caused by the gross
negligence or willful misconduct of Landlord, its agents, servants or employees)
or to any other Person.

ARTICLE 16.
INTENTIONALLY OMITTED

ARTICLE 17.
RIGHT OF INSPECTION

Section 17.01         Landlord Access to Premises.  Upon reasonable notice,
Tenant shall permit Landlord and its agents or representatives to enter the
Premises at all reasonable times during business days and business hours for the
purpose of determining whether or not Tenant is in compliance with its
obligations hereunder.

Section 7.02           No Landlord Obligation to Repair.  Nothing in this
Article 17 or elsewhere in this Lease shall imply any duty on the part of
Landlord to do any repairs, maintenance, renovation or other work on or at the
Premises, and performance thereof by Landlord shall not constitute a waiver of
Tenant’s default in failing to perform the same. In the event Landlord has the
right to undertake any such work and undertakes such work, Landlord, during the
progress of any such work, may keep and store at the Premises all necessary
materials, tools, supplies and equipment for the completion of such work.  Once
undertaken, Landlord shall diligently

16

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complete such work in a timely and workmanlike manner, in a manner consistent
with each of the provisions of this Lease as applicable to Tenant as if Landlord
were the tenant.  Provided Landlord is in compliance with the foregoing
sentence, Landlord shall not be liable for inconvenience, annoyance,
disturbance, loss of business or other damage of Tenant or any subtenant by
reason of making such repairs or the performance of any such work, or on account
of bringing materials, tools, supplies and equipment into the Premises during
the course thereof and the obligations of Tenant under this Lease shall not be
affected thereby.

ARTICLE 18.
LANDLORD’S RIGHT TO PERFORM TENANT’S COVENANTS

If Tenant at any time shall be in Default (as hereinafter defined) of any of its
obligations under this Lease beyond all applicable notice and cure periods, then
Landlord, without waiving or releasing Tenant from any obligation of Tenant
contained in this Lease, may (but shall be under no obligation to) perform such
obligation on Tenant’s behalf.  All costs and expenses reasonably incurred by
Landlord in connection with the performance of any act pursuant hereto together
with interest thereon at the Default Rate from the respective dates of
Landlord’s making demand to Tenant of each such payment of each such sum, cost,
expense, charge, payment or deposit, shall be paid by Tenant to Landlord within
twenty (20) business days of demand therefor provided Landlord’s demand shall be
accompanied by a reasonably detailed statement setting forth such expenditures,
the reasons therefor and reasonably detailed invoices and/or receipts evidencing
such expenditures.  Such amounts due from Tenant shall be Rent under this
Lease.  Any payment or performance by Landlord pursuant hereto shall not be nor
be deemed to be a waiver or release of the breach or default of Tenant with
respect thereto or of the right of Landlord to terminate this Lease, institute
summary proceedings or take such other action as may be permissible hereunder if
an Event of Default (as hereinafter defined) by Tenant shall have occurred.

ARTICLE 19.
PERMITTED USE; NO UNLAWFUL OCCUPANCY

Subject to the provisions of applicable law of this Lease, Tenant shall cause
the Premises to be used as agreed to by Landlord and Tenant.  Tenant shall not
use or occupy, nor permit or suffer the Premises or any part thereof to be used
or occupied for any unlawful or illegal business.

ARTICLE 20.
EVENTS OF DEFAULT, CONDITIONAL LIMITATIONS, REMEDIES

Section 20.01         Event of Default.  Each of the following events shall be
an “Event of Default” or “Default” hereunder:

(A)           TENANT SHALL FAIL TO PAY ANY INSTALLMENT OF RENT OR ANY PART
THEREOF WITHIN THIRTY (30) BUSINESS DAYS AFTER RECEIPT OF WRITTEN NOTICE FROM
LANDLORD THAT TENANT HAS FAILED TO PAY SUCH INSTALLMENT ONCE THE SAME HAS BECOME
DUE AND PAYABLE AND REMAINS UNPAID FOLLOWING SUCH THIRTY (30) BUSINESS DAY
PERIOD;

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(B)           SUBJECT TO FORCE MAJURE, TENANT’S DETERMINATION THAT OPERATION OF
THE PREMISES IS NOT ECONOMICALLY FEASIBLE, OR EXCEPT DURING TENANT’S
CONSTRUCTION, ALTERATION OR REPAIR OF IMPROVEMENTS ON THE PREMISES, TENANT SHALL
FAIL, FOR A PERIOD OF SIXTY (60) CONSECUTIVE BUSINESS DAYS FOLLOWING RECEIPT OF
NOTICE FROM LANDLORD, TO USE THE PREMISES FOR AGREED UPON ACTIVITIES;

(C)           TENANT IS GENERALLY NOT PAYING ITS DEBTS AS SUCH DEBTS BECOME DUE
OR SHALL ADMIT, IN WRITING, THAT IT IS UNABLE TO PAY ITS DEBTS AS SUCH DEBTS
BECOME DUE;

(D)           EXCEPT AS CONTEMPLATED PURSUANT TO SECTION 7.02 OF THIS LEASE,
TENANT SHALL MAKE AN ASSIGNMENT FOR THE BENEFIT OF CREDITORS;

(E)           TENANT SHALL FILE A VOLUNTARY PETITION UNDER TITLE 11 OF THE
UNITED STATES CODE OR IF SUCH PETITION IS FILED AGAINST TENANT AND AN ORDER FOR
RELIEF IS ENTERED, OR  TENANT SHALL FILE ANY PETITION OR ANSWER SEEKING,
CONSENTING TO OR ACQUIESCING IN ANY REORGANIZATION, ARRANGEMENTS, COMPOSITION,
READJUSTMENT, LIQUIDATION, DISSOLUTION OR SIMILAR RELIEF UNDER PRESENT OR ANY
FUTURE FEDERAL BANKRUPTCY CODE OR ANY OTHER PRESENT OR FUTURE APPLICABLE
FEDERAL, STATE OR OTHER STATUTE OR LAW, OR SHALL SEEK OR CONSENT TO OR ACQUIESCE
IN OR SUFFER THE APPOINTMENT OF ANY TRUSTEE, RECEIVER, CUSTODIAN, ASSIGNEE,
SEQUESTRATOR, LIQUIDATOR OR OTHER SIMILAR OFFICIAL OF TENANT OR OF ALL OR ANY
SUBSTANTIAL PART OF ITS PROPERTIES OR OF THE PREMISES OR ANY INTEREST OF TENANT
THEREIN;

(F)            IF WITHIN ONE HUNDRED TWENTY (120) DAYS AFTER THE COMMENCEMENT OF
ANY PROCEEDING AGAINST TENANT SEEKING ANY REORGANIZATION, ARRANGEMENT,
COMPOSITION, READJUSTMENT, LIQUIDATION, DISSOLUTION OR SIMILAR RELIEF UNDER THE
PRESENT OR ANY FUTURE FEDERAL BANKRUPTCY CODE OR ANY OTHER PRESENT OR FUTURE
APPLICABLE FEDERAL, STATE OR OTHER STATUTE OR LAW, SUCH PROCEEDING SHALL NOT
HAVE BEEN DISMISSED, OR IF, WITHIN ONE HUNDRED TWENTY (120) DAYS AFTER THE
APPOINTMENT, WITHOUT THE CONSENT OR ACQUIESCENCE OF TENANT, OF ANY TRUSTEE,
RECEIVER, CUSTODIAN, ASSIGNEE, SEQUESTRATOR, OR LIQUIDATOR OF TENANT OR OF ALL
OR ANY SUBSTANTIAL PART OF ITS PROPERTIES OR OF THE PREMISES OR ANY INTEREST OF
TENANT THEREIN, SUCH APPOINTMENT SHALL NOT HAVE BEEN VACATED OR STAYED ON APPEAL
OR OTHERWISE, OR IF, WITHIN THIRTY (30) DAYS AFTER THE EXPIRATION OF ANY SUCH
STAY, SUCH APPOINTMENT SHALL NOT HAVE BEEN VACATED;

(G)           IF ANY MATERIAL REPRESENTATION MADE HEREIN BY TENANT PROVES TO BE
FALSE OR INCORRECT AS OF THE DATE WHEN MADE; OR

(H)           TENANT SHALL FAIL TO OBSERVE OR PERFORM ONE OR MORE OF THE OTHER
TERMS, CONDITIONS, COVENANTS OR AGREEMENTS OF THIS LEASE AND SUCH FAILURE IS
MATERIAL AND SHALL CONTINUE FOR A PERIOD OF THIRTY (30) DAYS AFTER WRITTEN
NOTICE THEREOF BY LANDLORD TO TENANT SPECIFYING SUCH FAILURE (UNLESS SUCH
FAILURE REQUIRES WORK TO BE PERFORMED, ACTS TO BE DONE, OR CONDITIONS TO BE
REMOVED WHICH CANNOT BY THEIR NATURE REASONABLY BE PERFORMED, DONE OR REMOVED,
AS THE CASE MAY BE, WITHIN SUCH THIRTY (30) DAY PERIOD, IN WHICH CASE NO EVENT
OF DEFAULT SHALL BE DEEMED TO EXIST AS LONG AS TENANT SHALL HAVE COMMENCED
CURING THE SAME WITHIN SUCH THIRTY (30) DAY PERIOD AND SHALL DILIGENTLY AND
CONTINUOUSLY PROSECUTE THE SAME TO COMPLETION).

Section 20.02         Tenant Default; Payment of Rent and Termination of Lease. 
If any Event of Default shall have occurred and be continuing beyond all
applicable notice and cure periods,

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Landlord may, at its sole option, give to Tenant an additional thirty (30)
business days notice of cancellation of this Lease and opportunity to cure the
same, in which event this Lease and the Term shall come to an end and expire
upon the expiration of such thirty (30) business day period if Tenant thereafter
fails to cure the same with the same force and effect as if the date set forth
in the notice was the date of the end of the Term of the Lease; and Tenant shall
then quit and surrender the Premises  to Landlord, and all unpaid Rent shall be
immediately due and Tenant shall immediately pay the full amount of such unpaid
Rent to Landlord.  Upon payment in full of such amounts to the Landlord,
Landlord and Tenant shall be released from any and all further obligations under
this Lease, except those that are expressly provided for as surviving the
termination thereof. The terms of this Section 20.02 shall survive the
termination of this Lease.

SECTION 20.03         INTENTIONALLY OMITTED.

Section 20.04         No Reinstatement.  No receipt of monies by Landlord from
Tenant after the termination of this Lease, or after the giving of any notice of
the termination of this Lease (unless such receipt cures the Event of Default
which was the basis for the notice), shall reinstate, continue or extend the
Term or affect any notice theretofore given to Tenant, or operate as a waiver of
the right of Landlord to enforce the payment of Rent payable by Tenant
hereunder.  After the service of notice to terminate this Lease, Landlord may
demand, receive and collect any moneys due or thereafter falling due without in
any manner affecting such notice, all such monies collected being deemed
payments on account of the use and occupation of the Premises or, at the
election of Landlord, on account of Tenant’s liability hereunder.

Section 20.05         Strict Performance.  No failure by Landlord to insist upon
the strict performance of any covenants agreement, term or condition of this
Lease or to exercise any right or remedy consequent upon a breach thereof, and
no acceptance of full or partial Rent during the continuance of any such breach,
shall constitute a waiver of any such breach or of such covenant, agreement,
term or condition.  No covenant, agreement, term or condition of this Lease to
be performed or complied with by Tenant, and no breach thereof, shall be waived,
altered or modified except by a written instrument executed by Landlord.  No
waiver of any breach shall affect or alter this Lease, but each and every
covenant, agreement, term and condition of this Lease shall continue in full
force and effect with respect to any other then existing or subsequent breach
thereof.

Section 20.06         Remedies Cumulative.  Each right and remedy of Landlord
provided for in this Lease shall be cumulative and shall be in addition to every
other right or remedy provided for in this Lease and the exercise or beginning
of the exercise by Landlord of any one or more of the rights or remedies
provided for in this Lease shall not preclude the simultaneous or later exercise
by Landlord of any or all other rights or remedies provided for in this Lease.

Section 20.07         Landlord’s Costs and Expenses.  Tenant shall pay to
Landlord all reasonable costs and expenses, including, without limitation,
reasonable attorneys’ fees and disbursements, incurred by Landlord in any action
or proceeding to which Landlord may be made a party by reason of any act or
omission of Tenant hereunder provided the Landlord is the prevailing party in
such action.  Tenant also shall pay to Landlord all reasonable costs and
expenses, including without limitation, reasonable attorneys’ fees and
disbursements, incurred by Landlord in enforcing any of the covenants and
provisions of this Lease and incurred in any

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action brought by Landlord against Tenant on account of the provisions hereof,
and all such reasonable costs, expenses, and reasonable attorneys’ fees and
disbursements may be included in and form a part of any judgment entered in any
proceeding brought by Landlord against Tenant on or under this Lease provided
the Landlord is the prevailing party in such action.  All of the sums paid or
obligations incurred by Landlord as aforesaid, with interest and costs, shall be
paid by Tenant to Landlord promptly upon demand.

Section 20.08         Tenant Bankruptcy.  If an order for relief is entered or
if a stay of proceeding or other acts become effective in favor of Tenant or
Tenant’s interest in this Lease in any proceeding which is commenced by or
against Tenant under the present or any future federal bankruptcy code or any
other present or future applicable federal, state or other statute or law,
Landlord shall be entitled to invoke any and all rights and remedies available
to it under such bankruptcy code, statute, law or this Lease, including, without
limitation, such rights and remedies as may be necessary to protect adequately
Landlord’s right, title and interest in and to the Premises or any part thereof
and to assure adequately the complete and continuous future performance of
Tenant’s obligations under this Lease.  Adequate protection of Landlord’s right,
title and interest in and to the Premises, and adequate assurance of the
complete and continuous future performance of Tenant’s obligations under this
Lease, shall include, without limitation, the following requirements:

(A)           TENANT, TO THE EXTENT REQUIRED BY APPLICABLE LAW, COMPLY WITH ALL
OF ITS OBLIGATIONS UNDER THIS LEASE;

(B)           TENANT CONTINUE TO USE THE PREMISES IN THE MANNER REQUIRED BY THIS
LEASE AND APPLICABLE LAW;

(C)           TENANT, TO THE EXTENT THAT TENANT DESIRES TO ASSUME THIS LEASE,
PROVIDE PROOF TO LANDLORD, WITHIN ONE HUNDRED (120) DAYS AFTER ENTRY OF SUCH
ORDER OR THE EFFECTIVE DATE OF SUCH STAY, OF ADEQUATE ASSURANCE OF THE COMPLETE
AND CONTINUOUS FUTURE PERFORMANCE OF TENANT’S OBLIGATIONS UNDER THE LEASE, A
SECURITY DEPOSIT IN AN AMOUNT ACCEPTABLE TO LANDLORD, BUT IN NO EVENT MORE THAN
THE ANNUAL RENT PAYABLE HEREUNDER FOR THE THEN CURRENT LEASE YEAR;

(D)           TENANT, TO THE EXTENT REQUIRED BY APPLICABLE LAW, WILL USE ANY
UNENCUMBERED ASSETS AFTER THE PAYMENT OF ALL SECURED OBLIGATIONS AND
ADMINISTRATIVE EXPENSES TO ASSURE LANDLORD THAT SUFFICIENT FUNDS WILL BE
AVAILABLE TO FULFILL THE OBLIGATIONS OF TENANT UNDER THIS LEASE; AND

(E)           IF TENANT’S TRUSTEE, TENANT OR TENANT AS DEBTOR-IN-POSSESSION
ASSUMES THIS LEASE AND PROPOSES TO ASSIGN THE SAME (PURSUANT TO 11 U.S.C. §365,
AS THE SAME MAY BE AMENDED) TO ANY PERSON WHO SHALL HAVE MADE A BONA FIDE OFFER
TO ACCEPT AN ASSIGNMENT OF THIS LEASE ON TERMS ACCEPTABLE TO THE TRUSTEE, TENANT
OR TENANT AS DEBTOR-IN-POSSESSION, THEN NOTICE OF SUCH PROPOSED ASSIGNMENT,
SETTING FORTH (I) THE NAME AND ADDRESS OF SUCH PERSON, (II) ALL OF THE TERMS AND
CONDITIONS OF SUCH OFFER, AND (III) THE ADEQUATE ASSURANCE TO BE PROVIDED
LANDLORD TO ASSURE SUCH PERSON’S FUTURE PERFORMANCE UNDER THE LEASE, INCLUDING,
WITHOUT LIMITATION, THE ASSURANCE REFERRED TO IN 11 U.S.C. §365(B)(3) (AS THE
SAME MAY BE AMENDED), SHALL BE GIVEN TO LANDLORD BY THE TRUSTEE, TENANT OR
TENANT AS DEBTOR-IN-POSSESSION NO LATER THAN TWENTY (20) DAYS AFTER RECEIPT BY
THE TRUSTEE, TENANT OR TENANT AS DEBTOR-IN-POSSESSION OF SUCH OFFER, BUT IN ANY

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EVENT NO LATER THAN TEN (10) DAYS PRIOR TO THE DATE THAT THE TRUSTEE, TENANT OR
TENANT AS DEBTOR-IN-POSSESSION SHALL MAKE APPLICATION TO A COURT OF COMPETENT
JURISDICTION FOR AUTHORITY AND APPROVAL TO ENTER INTO SUCH ASSIGNMENT AND
ASSUMPTION, AND LANDLORD SHALL THEREUPON HAVE THE PRIOR RIGHT, TO BE EXERCISED
BY NOTICE TO THE TRUSTEE GIVEN AT ANY TIME PRIOR TO THE EFFECTIVE DATE OF SUCH
PROPOSED ASSIGNMENT, TO ACCEPT AN ASSIGNMENT OF THIS LEASE UPON THE SAME TERMS
AND CONDITIONS AND FOR THE SAME CONSIDERATION, IF ANY, AS THE BONA FIDE OFFER
MADE BY SUCH PERSON, LESS ANY BROKERAGE COMMISSIONS WHICH MAY BE PAYABLE OUT OF
THE CONSIDERATION TO BE PAID BY SUCH PERSON FOR THE ASSIGNMENT OF THIS LEASE.

ARTICLE 21.
NOTICES

All notices, certificates or other communications hereunder shall be in writing
and shall be deemed sufficiently given if (a) mailed by United States certified
mail, postage prepaid, or (b) if sent by a nationally recognized overnight
courier or (c) delivered personally, to the Landlord and Tenant as the case may
be, addressed as follows:

(a)

 

To Landlord:

 

 

 

 

 

Seneca Nation of Indians

 

 

1490 Route 438

 

 

Irving, New York 14801

 

 

Attn: President

 

 

 

 

 

With copies to:

 

 

 

 

 

Seneca Nation of Indians

 

 

P.O. Box 231

 

 

Salamanca, New York 14779

 

 

Attn: Treasurer

 

 

 

 

 

and

 

 

 

 

 

Seneca Nation of Indians

 

 

P.O. Box 231

 

 

Salamanca, New York 14779

 

 

Attn: Department of Justice

 

 

 

(b)

 

To Tenant:

 

 

 

 

 

Seneca Erie Gaming Corporation

 

 

310 Fourth Street

 

 

Niagara Falls, New York 14302-0777

 

 

Attn: President and CEO

 

 

 

 

 

With a copy to:

 

 

 

 

 

Seneca Erie Gaming Corporation

 

 

310 Fourth Street

 

 

Niagara Falls, New York 14302-0777

 

 

Attn: General Counsel

 

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Landlord and Tenant may, by notice given hereunder to each of the others,
designate any further or different addresses to which the subsequent notices,
certificates or other, communications to them shall be sent.

Every notice, demand, request, consent, approval, or other communication
hereunder shall be deemed to have been given or served only upon receipt.

ARTICLE 22.
TERMINATION

Tenant and Landlord shall each have the right to terminate the Lease in its
entirety at any time after the date of the Lease, by giving the other party at
least ninety (90) days advance written notice (the “Termination Notice”) that
such party intends to terminate the Lease effective as of the date set forth
therein (the “Termination Date”).  Tenant shall then quit and surrender the
Premises to Landlord on the Termination Date, and all unpaid Rent through the
Termination Date shall be immediately due and Tenant shall immediately pay the
full amount of such unpaid Rent through the Termination Date to Landlord.  Upon
payment in full of such amounts to the Landlord, Landlord and Tenant shall be
released from any and all further obligations under this Lease, except those
that are expressly provided for as surviving the termination thereof. The terms
of this Article 22 shall survive the termination of this Lease.

ARTICLE 23.
INTENTIONALLY OMITTED

ARTICLE 24.
INTENTIONALLY OMITTED

ARTICLE 25.
EXCAVATIONS AND SHORING

If any excavation shall be made or contemplated for construction or other
purposes upon property adjacent to the Premises, Tenant shall either:

(A)           AFFORD TO THE PERSON OR PERSONS CAUSING OR AUTHORIZED TO CAUSE
SUCH EXCAVATION THE RIGHT TO ENTER UPON THE PREMISES IN A REASONABLE MANNER FOR
THE PURPOSE OF DOING SUCH WORK AS MAY BE NECESSARY TO PRESERVE ANY OF THE WALLS
OR STRUCTURES ON THE PREMISES FROM INJURY OR DAMAGE AND TO SUPPORT THE SAME BY
PROPER FOUNDATIONS, OR

(B)           DO OR CAUSE TO BE DONE ALL SUCH WORK, AT TENANT’S EXPENSE, AS MAY
BE NECESSARY TO PRESERVE ANY OF THE WALLS OR STRUCTURES ON THE PREMISES FROM
INJURY OR DAMAGE AND TO SUPPORT THE SAME BY PROPER FOUNDATIONS.

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Tenant shall not, by reason of any such excavation or work, have any claim
against Landlord for damages or for indemnity or for suspension, diminution,
abatement, or reduction of Rent payable by Tenant hereunder unless such claim
arises from Landlord’s gross negligence or intentional misconduct.

ARTICLE 26.
CERTIFICATES BY LANDLORD AND TENANT

Section 26.01         Landlord Certificate.  Landlord agrees at any time and
from time to time, upon not less than ten (10) business days’ prior notice by
Tenant, to execute, acknowledge and deliver to Tenant or such other person
designated by Tenant, a statement in writing certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same, as modified, is in full force and effect and stating the
modifications) and the date to which the Rent payable by Tenant hereunder has
been paid, and stating whether or not to the best knowledge of the signer of
such certificate Tenant is in Default in the performance of any covenant,
agreement or condition contained in this Lease, and, if so, specifying in detail
each such Default of which the signer may have knowledge and any other such item
as Tenant shall reasonably request, due regard being given to the fact that such
certificate may be requested on behalf of a potential or actual Mortgagee.

Section 26.02         Tenant Certificate.  Tenant shall at any time and from
time to time upon not less than ten (10) days prior notice by Landlord execute,
acknowledge and deliver to Landlord or any other party specified by Landlord a
statement in writing certifying that this Lease is unmodified and in full force
and effect (or if there have been modifications, that the same, as modified, is
in full force and effect and stating the modifications) and the date to which
each item of the Rent payable by Tenant hereunder has been paid, and stating
whether or not to the best knowledge of the signer of such certificate Landlord
is in default in performance of any covenant, agreement or condition contained
in this Lease, and, if so, specifying in detail each such default of which the
signer may have knowledge.

ARTICLE 27.
INTENTIONALLY OMITTED

ARTICLE 28.
ENTIRE AGREEMENT

This Lease contains all the promises, agreements, conditions, inducements and
understandings between Landlord and Tenant relating to the Premises and there
are no promises, agreements, conditions, understandings, inducements, warranties
or representations, oral or written, expressed or implied, between them other
than as herein set forth.

ARTICLE 29.
QUIET ENJOYMENT

If and as long as Tenant faithfully performs the agreements, terms, covenants
and conditions of this Lease, Tenant shall peaceably and quietly have, hold and
enjoy the Premises for the term hereby granted without molestation or
disturbance by or from Landlord or any Person claiming through Landlord and free
of any encumbrance created or suffered by Landlord, except those encumbrances
created or suffered by Tenant and those as to which this Lease is subject and
subordinate.

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ARTICLE 30.
DISPUTES

All disputes between the parties with respect to this Lease shall be determined
by the courts of the Seneca Nation of Indians.

ARTICLE 31.
RECORDING OF MEMORANDUM

Landlord and Tenant, upon the written request of the other, shall join in the
execution of a memorandum of lease in proper form for recordation.

ARTICLE 32.
NO DISCRIMINATION WITH RESPECT TO THE PREMISES

With respect to the Premises, Tenant covenants and agrees that it shall (a)
neither commit nor permit discrimination or segregation by reason of race,
creed, color, religion, national origin, ancestry, sex, age, disability or
marital status (“Discrimination”) in the sale, transfer or assignment of its
interest under this Lease or in the subleasing, use or occupancy of the Premises
or any part thereof or in connection with the erection, maintenance, repair,
restoration, alteration or replacement of, or addition to, any building (b) not
willfully engage in any personnel practices which may have a discriminatory
effect and (c) comply with all federal laws, ordinances, rules, and regulations
from time to time in effect prohibiting Discrimination or segregation or
pertaining to equal employment opportunities.

ARTICLE 33.
TENANT’S CHARTER

Nothing contained in this Lease Agreement shall be construed as modifying or
amending the charter of the SEGC, as may be from time to time amended, nor
granting in advance any approvals that are otherwise required under the charter.

ARTICLE 34.
MISCELLANEOUS

Section 34.01         Captions.  The captions of this Lease are for convenience
of reference only and in no way define, limit or describe the scope or intent of
this Lease or in any way affect this Lease.

Section 34.02         Table of Contents.  The Table of Contents is for the
purpose of convenience of reference only and is not to be deemed or construed in
any way as part of this Lease or as supplemental thereto or amendatory thereof.

Section 34.03         Plurals.  The use herein of the neuter pronoun in any
reference to Landlord or Tenant shall be deemed to include any individual
Landlord or Tenant, and the use herein of

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the words “successors and assigns” or “successors or assigns” of Landlord or
Tenant shall be deemed to include the heirs, legal representatives and assigns
of any individual Landlord or Tenant.

Section 34.04         Execution of Documents.  If more than one party is named
as or becomes Tenant hereunder, Landlord may require the signatures of all such
parties in connection with any notice to be given or action to be taken by
Tenant hereunder.

Section 34.05         No Merger.  Except as otherwise expressly provided in this
Lease, there shall be no merger of this Lease or the leasehold estate created
hereby with the fee estate in the Land or any part thereof by reason of the same
Person acquiring or holding, directly or indirectly, this Lease or the leasehold
estate created hereby or any interest in this Lease or in such leasehold estate
as well as the fee estate in the Land.

Section 34.06         No Broker.  Each of the parties represents to the other
that it has not dealt with any broker in connection with this transaction.  If
any claim is made by broker who shall claim to have acted or dealt with Tenant
in connection with this transaction, Tenant will be responsible for payment of
the brokerage commission, fee or other compensation to which such broker is
entitled.

Section 34.07         Changes of Lease.  This Lease cannot be changed, modified
or terminated orally, but only by a written instrument of change, modification
or termination executed by the party against whom enforcement of any change,
modification, or termination is sought.

Section 34.08         Governing Law.  This Lease shall be interpreted and
construed in accordance with the laws of the Seneca Nation of Indians.

Section 34.09         Successors and Assigns.  The agreements, terms, covenants
and conditions herein shall be binding upon and shall inure to the benefit of,
Landlord and Tenant and their respective successors and assigns.

Section 34.10         No Violations.  Neither Landlord nor Tenant will do,
authorize or execute any act, deed or thing whatsoever or fail to take any such
action which will or may cause the other party to be in violation of any of its
obligations.

Section 34.11         References.  All references in this Lease to “Articles” or
“Sections” shall refer to the designated Article(s) or Section(s), as the case
may be, of this Lease.

Section 34.12         Severable.  If any term or provision of this Lease, or the
application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Lease shall be valid and be enforced to the fullest
extent permitted by law.

Section 34.13         No Abatement.  Except as may be otherwise expressly
provided herein, there shall be no abatement, diminution or reduction of Rent
payable by Tenant hereunder or of the other obligations of Tenant hereunder
under any circumstances.

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Section 34.14         Substitution.  Where Tenant is required to do or
accomplish any act or thing hereunder, Tenant may cause the same to be done or
accomplished by others with the same force and effect as if done or accomplished
by Tenant.

Section 34.15         Lease to Run With Land.  This Lease Agreement shall run
with the land, both as respects benefits and burdens created herein, and shall
be binding upon and inure to the benefit of the successors and assigns of the
respective parties.

Section 34.16         Force Majeure.  The obligations of Landlord and Tenant to
perform their respective covenants hereunder, other than, and exclusive of,
Tenant’s obligation to pay Rent hereunder, shall be excused to the extent that
Landlord or Tenant, as the case may be, is prevented or delayed from so doing by
reason of Force Majeure.  “Force Majeure” shall mean failure, in whole or in
part, or delay on the part of Tenant in the performance of any of the
obligations imposed upon Tenant under this Lease, shall be excused and Landlord
shall not exercise its option to terminate this Lease, when such failure or
delay is the direct result of any of the following causes: Acts of God,
earthquake, windstorm, hurricane, fire, flood, strikes or other labor stoppages
including shortages of labor or materials, the elements, malicious mischief by
third parties not within the control of Tenant, insurrection, riot, public
enemy, war, terrorism, wrongful acts of the Landlord or comparable extraordinary
cause not within the control of Tenant.

Section 34.17         Easements.  Landlord will, from time to time, at the
request of Tenant and at Tenant’s cost and expense (but subject to the approval
of Landlord, which approval shall not be unreasonably withheld, conditioned or
delayed), (i) grant consent to easements and other rights in the nature of
easements with respect to the Land to third parties, (ii) grant consent to
release existing easements or other rights in the nature of easements which are
for the benefit of the Land, (iii) execute petitions to have the Land annexed to
any municipal corporation or utility district and (iv) execute and deliver to
any person any instrument appropriate to confirm or effect such grants, releases
and petitions (to the extent of its interests in the Land).

REMAINDER OF PAGE LEFT BLANK INTENTIONALLY

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day
and year first above-written.

LANDLORD:

SENECA NATION OF INDIANS

By:          ______________________________
                Name:
                Title:

TENANT:

SENECA ERIE GAMING

CORPORATION

By:          ______________________________
                Name:
                Title:

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STATE OF NEW YORK

)

 

) ss:

COUNTY OF

)

 

On the _______ day of _____________ in the year 2007, before me, the undersigned
personally appeared ______________________, personally known to me or proved to
me on the basis of satisfactory evidence to be the individual(s) whose name(s)
is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.

________________________________________________
Signature and Office of individual taking acknowledgment

 

STATE OF NEW YORK

)

 

) ss:

COUNTY OF

)

 

On the _______ day of _____________ in the year 2007, before me, the undersigned
personally appeared ______________________, personally known to me or proved to
me on the basis of satisfactory evidence to be the individual(s) whose name(s)
is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.

________________________________________________
Signature and Office of individual taking acknowledgment

 

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Exhibit A

Description of Premises Leased for SEGC Use

The approximate nine acre parcel(s) of land in the inner harbor district of
Buffalo, New York bordered by Michigan Avenue to the west, Perry Street to the
north, Marvin Street to the east and South Park Avenue to the south.

A-1

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