Document:

<PAGE>   1

                                                                    EXHIBIT 4.03

                                 Apps.com, Inc.
               Nonqualified Stock Option Grant Agreement under the
                           1999 Equity Incentive Plan

Number of Shares: _________________

Date of Grant: December __, 2000

Apps.com, Inc., a Delaware corporation (the "Corporation"), hereby grants to
________________________ (the "Participant"), as of the date stated above, an
option (the "Option") to purchase the number of shares stated above (the
"Shares") of the Corporation's Common Stock, $.01 par value (the "Common
Stock"), pursuant to the Corporation's 1999 Equity Incentive Plan (the "Plan"),
a copy of which is attached hereto and is incorporated herein in its entirety by
this reference. The Participant hereby accepts the Option, subject to the terms
and conditions set forth in the Plan as fully as if they were set forth herein,
and to the following additional terms and conditions:

1. Type of Option. It is not intended that the Option be an "incentive stock
option" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").

2. Exercise Price. The price at which Shares may be purchased pursuant to the
Option is $[__] per share.

3. Option Period. The Option expires ten years from the date of grant, as set
forth above. The Participant should take special note that the Option may be
terminated early by certain events including termination of employment,
disability or death, as provided in the Plan.

4. Vesting of Right to Exercise. During the period commencing on the date of
grant and continuing until the date that is one year from the date of grant (the
"Initial Vesting Date"), the Option shall not be exercisable to any extent.
Commencing on the first day following the Initial Vesting Date and during the
ensuing month, the Option may be exercised for not more than one-quarter (1/4)
of the Shares. Thereafter, on the last day of such ensuing month and on the last
day of each of the thirty-six (36) months thereafter, the Option may be
exercised (to the extent not already exercised) for not more than an additional
one-forty-eighth (1/48) of the Shares. Thereafter, and for the duration of the
Option, the Option may be exercised in full.

5. Exercise. (a) The Option may be exercised from time to time with respect to
all or any part of the Shares as to which it is exercisable at the time;
provided, however, that it may not be exercised as to less than ten percent of
the Shares at any one time, except with respect to the remaining Shares then
purchasable under the Option, if less than ten percent of the Shares. No
fractional Shares may be purchased except in combination with a fraction or
fractions under another presently exercisable option or options granted under
the Plan, and then only to the extent that such combination equals a full Share.
(b) To exercise the Option, the Participant (or other person exercising the
Option) must deliver to the Corporation: (1) a completed and signed notice of
exercise, in the form provided by the Company, and must follow any other
procedures or execute any other documents as instructed by the Company, and (2)
payment in full of the exercise price for the Shares. Payment may be made (i) by
certified check,

<PAGE>   2

bank draft or money order made payable to the order of the Company, (ii) by
delivery of Shares having a fair market value (as determined by the Board in
good faith in its reasonable discretion) on the date of exercise equal to the
exercise price, provided, however, that such Shares have been owned by the
Participant for more than six months and have been paid for within the meaning
of Rule 144 promulgated under the Securities Act of 1933, as amended (and, if
the such Shares were purchased from the Company by use of a promissory note, the
note has been fully paid with respect to such Shares) or (iii) by a combination
of cash and a promissory note in accordance with the terms of the Plan. In
addition, the exercise of an Option shall be subject to satisfaction of all
conditions the Board may impose on the exercise of such Option pursuant to this
Agreement or the Plan, and any such exercise shall be effective only after all
such conditions have been satisfied.

6. No Rights as Stockholder. The Participant (or any other person entitled to
exercise the Option) shall not be entitled to any rights as a stockholder of the
Corporation with respect to any Shares covered by the Option until such Shares
shall have been registered on the stock transfer books of the Corporation in the
name of the Participant (or such other person).

7. Compliance with Laws, Regulations and Rules. The Plan, this Agreement, the
Option and the obligation of the Corporation to sell and deliver the Shares upon
exercise of the Option are and shall be subject to (a) all applicable laws,
government regulations and rules and (b) all applicable regulations and rules
adopted by the Board in accordance with the Plan. If at any time the Board
determines in its discretion that the listing, registration or qualification, on
any securities exchange or under any federal or state law, of the Shares
deliverable upon exercise of the Option, or the consent or approval of any
regulatory body, or compliance with any law, rule or regulation, is necessary or
desirable as a condition of, or in connection with, the delivery or purchase of
Shares, then exercise of the Option shall not be effective unless such listing,
registration, qualification, consent, approval or compliance shall have been
effected or obtained free of any conditions not acceptable to the Board.

8. Legend on Certificates. Each certificate representing the Shares may bear
restrictive legends referring to the restrictions on transfer and repurchase
rights of the Company contained in the Stock Restriction Agreement and the
restrictions on transfer imposed by the Securities Act of 1933, as amended, and
any applicable exemption therefrom pursuant to which the Shares may be issued.

9. No Employment Rights. Nothing in the Plan, the Option or this Option
Agreement confers upon the Participant any right to continued employment or
interferes with the right of the Corporation to terminate the Participant's
employment.

10. Taxes. As a condition to the issuance of Shares under this Option, the
Corporation shall have the right to require the Option holder to remit to the
Corporation an amount sufficient to satisfy any federal, state or local
withholding tax requirements or make other arrangements satisfactory to the
Corporation with regard to such taxes, as provided in the Plan.

11. Definition. As used in this Agreement, the term "Corporation" shall include
any subsidiary or parent of the Corporation as defined in Sections 424(e) and
(f) of the Code.

12. Amendments. The Board may at any time or times amend the Plan or the Option
for the purpose of satisfying the requirements of any changes in applicable laws
or regulations or for any other purpose which at the time may be permitted by
law. No termination or amendment of the Plan or amendment of the Option shall,
without the Participant's consent, adversely affect the Participant's rights
under the Option.

13. Consistency with Plan. If there is any inconsistency between the provisions
of this Agreement and the provisions of the Plan, the latter shall control.

<PAGE>   3

14. Complete Agreement. This Agreement (including the Plan, which is
incorporated by reference) constitutes the entire agreement between the Company
and the Participant with respect to the Option, and supersedes all prior
agreements or promises with respect to the Option.

15. Successors and Assigns. Subject to the terms of the Plan, the Company may
assign any of its rights and obligations under this Agreement, and this
Agreement shall be binding on, and inure to the benefit of, the successors and
assigns of the Company. Subject to the restrictions on transfer of the Option
described in the Plan, this Agreement shall be binding on Participant's
permitted successors and assigns (including heirs, executors, administrators and
legal representatives).

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                            Apps.com, Inc.

                                            By
                                               ---------------------------------
                                            Name:
                                                 -------------------------------
                                            Title:
                                                  ------------------------------

I accept this Agreement and agree to the terms and conditions in this Agreement
and the Plan. I acknowledge that I have received a copy of the Company's 1999
Equity Incentive Plan, and I understand and agree that this Agreement is not
meant to interpret, extend, or change the Plan in any way, nor to represent the
full terms of the Plan.

                                            ------------------------------------
                                            Participant
                                            Date:
                                                 -------------------------------<PAGE>

                                                                   EXHIBIT 10.66

            ________________________________________________________

                                     LEASE

                                    BETWEEN

                               HAHF PIONEER, LLC

                                                Landlord

                                      AND

                               PIONEER HOTEL INC.

                                                Tenant

                  Dated:    December 29, 2000

                  Premises: Pioneer Hotel and Casino
                            2200 South Casino Drive
                            Laughlin, Nevada  89028

            ________________________________________________________

<PAGE>

                                     LEASE
                                     -----

       THIS LEASE is made as of the 29th day of December, 2000, between HAHF
PIONEER, LLC, a Delaware limited liability company, as "Landlord", having an
office for the conduct of business c/o Heller Financial, Inc., 500 West Monroe,
Chicago, Illinois 60661, and PIONEER HOTEL INC., a Nevada corporation, as
"Tenant", having an office for the conduct of business c/o Sante Fe Gaming
Corporation, 4336 Losee Road, Las Vegas, Nevada  89030.

                              W I T N E S S E T H:
                              - - - - - - - - - -

       The parties hereto, for themselves, their heirs, distributees, executors,
administrators, legal representatives, successors and assigns, hereby covenant
as follows:

                                   ARTICLE A
                                   ---------

                           CERTAIN LEASE PROVISIONS

1.     Address for
       the Premises:     Pioneer Hotel and Casino
                         2200 South Casino Drive
                         Laughlin, Nevada  89028

2.     (a) Term:         Approximately twenty (20) years, beginning
                         on the Commencement Date, and ending on the Expiration
                         Date.

       (b) Commencement
           Date:         December 29, 2000

       (c) Expiration
           Date:         December 31, 2020, unless sooner terminated or extended
                         pursuant to this Lease.

       (d) Extension
           Options:      Subject to and upon terms and conditions set forth
                         herein, Landlord hereby grants to Tenant two (2)
                         options to extend the initial Term of this lease for
                         terms of five (5) years each at fair market rental
                         value determined in accordance with the provisions of
                         Article 22, but otherwise upon the same terms and
                         ----------
                         conditions set forth in this Lease. Such options may be
                         exercised by written notice by Tenant to Landlord at
                         least 365 days before the expiration of the initial
                         Term or the extended term during which the option is
                         exercised, as the case may be, provided that at the
                         time of Tenant's exercise of each such notice, there is
                         no Event of Default hereunder.

3.     Fixed Rent:       As set forth on Exhibit B.
                                         ---------

                                       1
<PAGE>

4.     Use of Premises:  Any lawful use reasonably related to Tenant's current
                         business operations and any other lawful use which is
                         equal to or a higher and better use than Tenant's
                         current business operations, including but not limited
                         to, casino and hotel.

5.     Address for Notice:

       For Landlord:     c/o Heller Financial, Inc.
                         500 West Monroe
                         Chicago, Illinois  60661
                         Attention: Manager of Operations - Capital Finance
                                    Group

       For Tenant:       c/o Santa Fe Gaming Corporation
                         4336 Losee Road
                         Las Vegas, Nevada  89030
                         Attention:  Thomas Land

                                       2
<PAGE>

                                   ARTICLE B
                                   ---------

                              CERTAIN DEFINITIONS

     "Additional Rent" is defined in Section 2.2.
                                     -----------

     "Affiliate" shall mean, with respect to any corporation, partnership,
limited liability company or other business entity, another corporation,
partnership, limited liability company or other entity business which directly
or indirectly, controls or is controlled by or is under common control with the
former corporation, partnership, limited liability company, or other business
entity.  For the purposes of this definition, "control" (including
"controlling", "controlled by" and "under common control with") as used with
respect to any corporation, partnership, limited liability company or other
business entity, shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of such
corporation, partnership, limited liability company or other business entity,
whether through the ownership of voting securities, partnership interests, by
contract or otherwise.

     "Alterations" is defined in Section 5.4.
                                 -----------

     "Annual Maintenance Expense" is defined in Section 4.5.
                                                -----------

     "Bankruptcy Code" means the provisions of 11 U.S.C. Section 101 et seq. or
any statute of similar purpose or nature as more particularly set forth in
Section 9.9.
-----------

     "Buildings" means (a) the casino building consisting of approximately
19,500 square feet, (b) the hotel consisting of 416 guest rooms together with
meeting rooms, restaurants and associated facilities, (c) building equipment and
(d) other improvements now or hereafter erected on the Land.

     "Business day" is every day which most commercial banks based in New York,
New York are open for the ordinary conduct of business.

     "Claims" is defined in Section 11.3.
                            ------------

     "Closing" is defined in Section 24.2.
                             ------------

     "Commencement Date" is set forth in Article A, Section 2(b).
                                         -----------------------

     "Deed" is defined in Section 24.2.
                          ------------

     "Default Rate"  means three percent (3%) over the prime reference rate
announced from time to time by Citibank, N.A. in New York, New York, as such
prime reference rate may be adjusted and announced from time to time, or if
unavailable, the parties shall use the prime reference rate of any New York
regional bank selected by Landlord.

                                       3
<PAGE>

     "Deficiency" is defined in Section 12.3(c).
                                ---------------

     "Early Purchase Option" is defined in Section 25.1.
                                           ------------

     "Environmental Laws" is defined in Section 18.10.
                                        -------------

     "Event of Default" is defined in Section 12.1.
                                      ------------

     "Event of Loss" is defined in Section 7.1.
                                   -----------

     "Exchange Agreement" means the Exchange Agreement dated as of December 29,
2000 between Landlord, as transferee, Pioneer LLC, as transferor and Tenant, as
tenant.

     "Expiration Date" is defined in Article A, Section 2(c).
                                     -----------------------

     "FF&E" means the furniture, furnishings, fixtures and equipment at the time
in question situated at the Premises, whether owned or leased, excluding
however, Gaming Equipment.

     "Fixed Rent" is defined in Article A, Section 3.
                                --------------------

     "Gaming Authorities" means, collectively, the Nevada Gaming Control Board,
Nevada Gaming Commission and the Clark County Liquor and Gaming Licensing Board.

     "Gaming Equipment" means, collectively, all gaming devices as that term is
defined in Nevada Revised Statutes ("NRS") 463.0155, games as that term is
defined in NRS 463.0152 and associated equipment as that term is defined in NRS
463.0152 and associated equipment as that term is defined in NRS 463.0136.

     "Gaming Laws" mean, collectively, the Nevada Gaming Control Act and the
regulations promulgated thereunder.

     "Gaming Lease" means a lease or license of Gaming Equipment between Tenant
as lessee or licensee, as the case may be, and a third party.

     "Gross Room Revenue" means all cash paid or received to or for the benefit
of Tenant directly or indirectly in connection with the rental, leasing, use or
occupancy of any and all hotel guest and meeting rooms in the Premises,
including without limitation all food and beverage charges and allocations to
guests, before deduction of any expenses whatsoever; provided, however, that
                                                     --------  -------
Gross Room Revenue shall not include (i) any gratuities or service charges added
to customer's bills which are turned over by Tenant to employees, (ii) any
credits or refunds made to customers, (iii) applicable sales, use, room, excise,
occupancy, admission, cabaret or similar taxes or other similar governmental
charges, which are collected from customers of the Premises and are separately
stated and (iv) all revenues from Gaming Equipment.

                                       4
<PAGE>

     "Hotel FF&E" means FF&E at the time in question situated at the Premises,
whether owned or leased.

     "Ground Lease" means that certain ground lease dated October 31, 1978, as
amended, between Ground Lessor as landlord and Tenant, as successor-in-interest
to Colorado River Motel and Casino, Inc. and Colorado River Resort Hotel, Inc.
and Margaret Elardi, as tenant.  The tenant's interest therein has been assigned
to Landlord pursuant to a certain Assignment and Assumption of Ground Lease
dated even date herewith.

     "Ground Leased Land" means that certain real property leased by Landlord
pursuant to the Ground Lease and described on Exhibit A-2 attached hereto and
                                              -----------
incorporated herein by this reference.

     "Ground Lessor" means PalMall Properties, Inc., a California corporation,
The James and Sharon Schutz Trust and The Janice B. Illig Trust (as successors-
in-interest to Clara J. Troutman, deceased, and W.J. Troutman AKA Wilmer J.
Troutman, deceased).

     "Ground Rent" means all fixed rent, additional rent and other charges due
the Ground Lessor pursuant to the Ground Lease.

     "Guarantors" means collectively, Santa Fe Gaming Corporation, a Nevada
corporation, Sante Fe Hotel, Inc., a Nevada corporation, and Tenant.

     "Guaranty" means that certain Guaranty dated even date herewith wherein
Guarantors have jointly and severally unconditionally guaranteed to Landlord,
among other things, the full and complete performance by Tenant of Tenant's
obligations under this Lease.

     "Hazardous Substances" is defined in Section 18.11.
                                          -------------

     "Impositions" is defined in Section 3.1.
                                 -----------

     "Improvements" means the Building and improvements now or hereafter erected
on the Land.

     "Indemnified Parties" is defined in Section 11.3(a).
                                         --------------

     "Land" means that certain real property owned in fee simple by Landlord and
described on Exhibit A-1 attached hereto and incorporated herein by this
             -----------
reference.

     "Landlord" is defined in the introductory paragraph to this Lease.

     "Lease" means this lease made between Landlord, as landlord, and Tenant, as
tenant.

                                       5
<PAGE>

     "Lease Year" means each twelve month period during the Term commencing on
the first day of the first calendar month following the Commencement Date and
each twelve months thereafter.

     "Management Agreement" means that certain Management Agreement dated
December 30, 1998 between Santa Fe Gaming Corporation, as manager, and Tenant,
as owner, as amended by a First Amendment dated December 29, 2000.

     "Mortgage" is defined in Section 3.2.
                              -----------

     "Mortgagee" is defined in Section 3.2.
                               -----------

     "Non-Disturbance Agreement" is defined in Section 10.3.
                                               ------------

     "Offer Price" is defined in Section 23.1.
                                 ------------

     "Operating Supplies" means all consumable items used in, or required in
connection with the operation of the Premises as a hotel, including, without
limitation, food and beverages (including, without limitation, all alcoholic
beverages), fuel, soap, cleaning equipment and materials, matches, stationery,
linens, and other items.

     "Permitted Encumbrances" means:

       (a) any and all Requirements and any and all violations thereof;

       (b) all liens, encumbrances and other matters affecting title to the
Premises on the date hereof as set forth in the title policy issued to Landlord
effective on the date hereof;

       (c) any state of facts existing on the Commencement Date which an
accurate survey or personal inspection of the Premises would show;

       (d) all Impositions accrued or unaccrued, fixed or not fixed, all of
which are at the Commencement Date, not yet due and payable;

       (e) all licenses, easements, rights of way and other rights, if any,
acquired by any public service or utility corporation or others to maintain and
operate lines, wires, cables, poles and distribution boxes, in, over and upon
the Premises, whether or not of record;

       (f) the Underlying Agreements;

       (g) subject to the provisions of Article 10, all Mortgages which may now
                                        ----------
or hereafter affect all or part of the Premises;

       (h) the Ground Lease;

                                       6
<PAGE>

       (i) the physical condition and state of repair of the Premises as the
same may be on the Commencement Date, including all deterioration, injury, loss,
damage or destruction which may have occurred prior to such date;

       (j) the Master Lease Agreement between Tenant and PDS Gaming Corporation-
Nevada dated December 29, 2000; and

       (k) the Promissory Note dated December 29, 2000 between Tenant as maker
and Sante Fe Hotel Inc. as payee in the original principal amount of $1,900,000.

     "Person" or "person" means a natural person, a partnership, a corporation,
a limited liability company, a trust and/or any other form of business
association or entity.

     "Personal Property" means the FF&E and all other machinery, appliances,
equipment, furniture, fixtures and all other tangible and intangible personal
property and contractual rights of every kind or nature located in or on, or
attached to, or used or to be used in connection with the Land, the Ground
Leased Land and the Buildings, structures, improvements or fixtures which
constitute all of the tangible and intangible personal property assets and
contractual rights acquired by Landlord pursuant to the Exchange Agreement; all
building materials and goods procured for use or in connection with the
foregoing; and all additions, substitutions and replacements to any of the
foregoing, excluding however, all Gaming Equipment.

     "Premises" means the Land, the Ground Leased Land, the Improvements and the
Personal Property.

     "Purchase Notice" is defined in Section 24.1.
                                     ------------

     "Purchase Option" is defined in Section 24.1.
                                     ------------

     "Remedial Work" is defined in Section 18.7.
                                   ------------

     "Renewal Fair Market Rental Value" is defined in Section 22.1(a).
                                                      ---------------

     "Renewal Rent Notice" is defined in Section 22.1(a).
                                         ---------------

     "Rent" is defined in Section 2.3.
                          -----------

     "Requirements" is defined in Section 11.1.
                                  ------------

     "Restoration" is defined in Section 7.1.
                                 -----------

     "Retainage" is defined in Section 7.2(c).
                               --------------

     "SFGC" means Santa Fe Gaming Corporation, a Nevada corporation.

                                       7
<PAGE>

     "Stipulated Loss Value" is defined in Section 26.1.
                                           ------------

     "Subtenant" is defined in Section 9.4.
                               -----------

     "Taking" is defined in Section 8.1.
                            -----------

     "Taking Date" is defined in Section 8.1.
                                 -----------

     "Tenant" is defined in the introductory paragraph to this Lease.

     "Tenant's Renewal Response Notice" is defined in Section 22.1(b).
                                                      ---------------

     "Term" is defined in Article A, Section 2(a).
                          -----------------------

     "Threshold Amount" shall mean $2,000,000.

     "Transfer" is defined in Section 9.1(a).
                              --------------

     "Underlying Agreements" means those maintenance agreements, service
contacts, licenses, permits and contracts set forth on Exhibit C attached hereto
                                                       ---------
and incorporated herein by this reference.

     "Work" is defined in Section 5.5.
                          -----------

                                   ARTICLE 1

                               PREMISES AND TERM
                               -----------------

          Section 1.1.   During the Term, Landlord, in consideration of the
rents herein reserved and of the terms, provisions, covenants and agreements on
the part of Tenant to be kept, observed and performed, does hereby lease,
license and demise the Premises unto Tenant, and Tenant does hereby hire and
take the Premises from Landlord, subject to the Permitted Encumbrances.  In
addition, from and after the Commencement Date and at all times throughout the
Term, Tenant shall observe and perform each and every obligation of Landlord
pursuant to the Ground Lease and Underlying Agreements as and when such
obligations are due.

          Section 1.2.   Tenant shall lease the Premises for the Term, unless
sooner terminated as hereinafter provided or pursuant to law.

                                       8
<PAGE>

                                   ARTICLE 2

                         FIXED RENT AND ADDITIONAL RENT
                         ------------------------------

          Section 2.1.   (a) Tenant shall pay to Landlord as Fixed Rent for the
Premises during the Term the amounts stated in Exhibit B attached hereto.  Fixed
                                               ---------
Rent shall be payable in monthly installments in advance on the first day of
each and every month during the Term, without previous demand therefor and
without offset or deduction of any kind whatsoever, other than as expressly
provided for herein.  Notwithstanding the foregoing, Tenant shall pay the
partial month's installment of Fixed Rent (with respect to the remaining days of
the month in which this Lease is executed) upon the execution of this Lease.

          (b)  At the end of the seventh Lease Year (the 85th month), the Fixed
Rent set forth on Exhibit B shall be adjusted in accordance with the rent
                  ---------
adjustment provisions set forth in Exhibit F attached hereto and incorporated
                                   ---------
herein by this reference.

          Section 2.2.   Tenant shall also pay and discharge as additional rent
(the "Additional Rent") all other amounts, liabilities and obligations of
whatsoever nature relating to the Premises, including, without limitation, all
Impositions (as defined in Section 3.1), all Ground Rent as and when due, all
amounts due or arising under any declarations, common area maintenance
agreements, covenants, conditions and restrictions, easements, or other similar
agreements affecting the Premises or any adjoining property thereto, and all
interest and penalties that may accrue thereon in the event of Tenant's failure
to pay such amounts when due, and all damages, costs and expenses which Landlord
may incur by reason of any default of Tenant or failure on Tenant's part to
comply with the terms of this Lease, all of which Tenant hereby agrees to pay
within ten (10) days after written demand or as is otherwise provided herein.
Upon any failure by Tenant to pay any of the Additional Rent, Landlord shall
have all legal, equitable and contractual rights, powers and remedies provided
either in this Lease or by statute or otherwise in the case of nonpayment of the
Fixed Rent.  The term Additional Rent shall be deemed rent for all purposes
hereunder other than with respect to Tenant's internal accounting procedures.

          Section 2.3.   All Fixed Rent and Additional Rent payable hereunder
(collectively, "Rent") shall be made payable to Landlord and sent to Landlord's
address set forth in Article A, or to such other person or persons or at such
                     ---------
other place as may be designated by notice from Landlord to Tenant, from time to
time, and shall be made in United States currency which shall be legal tender
for all debts, public and private. Landlord may opt to receive all Rent payable
hereunder when due by wire transfer of immediately available funds to an account
designated from time to time by Landlord; such option shall become effective
five (5) business days after Landlord's written request. Notwithstanding the
foregoing, Impositions and other Additional Rent shall be payable to the parties
to whom they are due, except as otherwise provided herein.

          Section 2.4.   Landlord and Tenant acknowledge that this Lease is a
Section 467

                                       9
<PAGE>

rental agreement, within the meaning of Section 467(d) of the Internal Revenue
Code, and agree to report rent and other items consistent with such
characterization. Within thirty (30) days of the date hereof, Landlord and
Tenant shall agree to a schedule describing the allocation of rent and other
items for purposes of Section 467 of the Internal Revenue Code. Landlord and
Tenant will report rent and other items in a manner consistent with such
schedule which shall be adjusted to the extent required by Treas. Reg. Section
1.467-6, upon issuance of such regulations.

          Section 2.5.   This Lease shall be deemed and construed to be a "net
lease", and Tenant shall pay to Landlord, absolutely net throughout the Term,
the Rent, free of any charges, assessments, impositions or deductions of any
kind and without abatement, deduction or set-off whatsoever, other than as
expressly provided for herein.  Under no circumstances or conditions, whether
now existing or hereafter arising, or whether beyond the present contemplation
of the parties, shall Landlord be expected or required to make any payment of
any kind whatsoever or be under any other obligation or liability hereunder,
except as herein otherwise expressly set forth.  Tenant shall pay all costs,
expenses and charges of every kind and nature relating to the Premises,
including those arising under the Ground Lease, except debt service on any
Mortgage or any other indebtedness of Landlord, which may arise or become due or
payable prior to, during or after (but attributable to a period falling prior to
or within) the Term.  Except as otherwise specifically provided in this Lease,
Tenant's obligation to pay Rent hereunder shall not terminate prior to the date
definitely fixed for the expiration of the Term, notwithstanding the exercise by
Landlord of any or all of its rights under Article 12 hereof or otherwise, and
the obligations of Tenant hereunder shall not be affected by reason of:  any
damage to or destruction of the Premises or any part thereof, any taking of the
Premises or any part thereof or interest therein by condemnation or otherwise,
any prohibition, limitation, restriction or prevention of Tenant's use,
occupancy or enjoyment of the Premises or any part thereof, or any interference
with such use, occupancy or enjoyment by any person or for any reason, any
matter affecting title to the Premises, any eviction by paramount title or
otherwise, any default by Landlord hereunder, the impossibility,
impracticability or illegality of performance by Landlord, Tenant or both, any
action of any governmental authority, Tenant's acquisition of ownership of all
or part of the Premises (unless this Lease shall be terminated by a writing
signed by all persons, including any mortgagee, having an interest in the
Premises), any breach of warranty or misrepresentation, or any other cause
whether similar or dissimilar to the foregoing and whether or not Tenant shall
have notice or knowledge thereof and whether or not such cause shall now be
foreseeable. The parties intend that the obligations of Tenant under this Lease
shall be separate and independent covenants and agreements and shall continue
unaffected unless such obligations have modified or terminated pursuant to an
express provision of this Lease. Nothing in this Section 2.5 shall be deemed to
                                                 -----------
preclude Tenant from seeking monetary damages or equitable relief pursuant to an
action against the Landlord before a court of competent jurisdiction.

                                       10
<PAGE>

                                   ARTICLE 3

                                  IMPOSITIONS
                                  -----------

          Section 3.1.   From and after the Commencement Date and throughout the
Term, Tenant shall pay and discharge not later than ten (10) days before any
fine, penalty, interest or cost may be added thereto, or lien or encumbrance
imposed, for the non-payment thereof, all real and personal property taxes, ad
valorem taxes in the nature of property taxes, sales, use, excise and other
similar taxes (including commercial rent and intangibles taxes), gaming taxes,
transfer taxes, conveyance taxes, mortgage taxes, stamp taxes and documentary
recording taxes, assessments, water rents, sewer rents and charges, duties,
impositions, license and permit fees, charges for public utilities of any kind
(including, without limitation, electric, gas, oil, water, sanitary sewer,
telephone, cable and fiber optic) payments and other charges of every kind and
nature whatsoever, ordinary or extraordinary, foreseen or unforeseen, general or
special, in said categories, together with any interest or penalties imposed
upon the late payment thereof, which, pursuant to past, present or future law,
during, prior to or after (but attributable to a period falling prior to or
within) the Term, shall have been or shall be levied, charged, assessed, imposed
upon or grow or become due and payable out of or for or have become a lien on
the Premises or any part thereof, any improvements or personal property in or on
the Premises, the Rents and income payable by Tenant or on account of any use of
the Premises and such franchises as may be appurtenant to the use and occupation
of the Premises (all of the foregoing being hereinafter referred to as
"Impositions").  Tenant, upon request from Landlord, shall submit to Landlord
the proper and sufficient receipts or other evidence of payment and discharge of
the same.  If any Impositions are not paid when due under this Lease, Landlord
shall have the right but shall not be obligated to pay the same following
written notice to Tenant of such payment, provided Tenant does not contest the
same as herein provided.  If Landlord shall make such payment, Landlord shall
thereupon be entitled to repayment by Tenant on demand as Additional Rent
hereunder.

          Section 3.2.   Tenant shall have the right to protest and contest any
Impositions imposed against the Premises or any part thereof, provided (i) the
same is done at Tenant's sole cost and expense, (ii) nonpayment will not subject
the Premises or any part thereof to sale or other liability by reason of such
nonpayment, (iii) such contest shall not subject Landlord or the holder (the
"Mortgagee") of any mortgage or deed of trust (a "Mortgage") encumbering
Landlord's interest in all or any part of the Premises to the risk of any
criminal or civil liability and (iv) Tenant shall provide such security as may
reasonably be required by Landlord or any Mortgagee or under the terms of any
Mortgage to ensure payment of such contested Imposition unless such contested
tax must be paid, and is paid, to the levying authority as a condition to such
contest.  Landlord agrees to execute and deliver to Tenant any and all documents
reasonably required for such purpose and to cooperate with Tenant in every
reasonable respect in such contest, but without any cost or expense to Landlord.
Any refunds resulting from such contest which are allocable to the Term of the
Lease shall be Tenant's property, and, if received by Landlord, promptly
remitted to Tenant.

                                       11
<PAGE>

          Section 3.3.   To the extent permitted by law, Tenant shall have the
right to apply for the conversion of any Impositions to make the same payable in
annual installments over a period of years, and upon such conversion Tenant
shall pay and discharge said annual installments as they shall become due and
payable.  Tenant shall pay all such deferred installments prior to the
expiration or sooner termination of the Term, notwithstanding that such
installments shall not then be due and payable; provided, however, that any
                                                --------  -------
Impositions (other than one converted by Tenant so as to be payable in annual
installments as aforesaid) relating to a fiscal period of the taxing authority,
a part of which is included in a period of time after the Expiration Date, shall
(whether or not such Impositions shall be assessed, levied, confirmed, imposed
or become payable, during the Term) be adjusted between Landlord and Tenant as
of the Expiration Date, so that Landlord shall pay that portion of such
Impositions which relate to that part of such fiscal period included in the
period of time after the Expiration Date, and Tenant shall pay the remainder
thereof.

          Section 3.4.   If at any time during the Term, a tax or excise on
Rents or other tax, however described, is levied or assessed with respect to the
Rent or any part thereof (as opposed to the income of Landlord) or against
Landlord as a substitute in whole or in part for any Impositions theretofore
payable by Tenant, Tenant shall pay and discharge such tax or excise on Rents or
other tax before it becomes delinquent, and the same shall be deemed to be an
Imposition levied against the Premises.

          Section 3.5.   Except as set forth in Section 3.4 above, Tenant shall
not be obligated to pay any franchise, excise, corporate, succession, capital,
levy or transfer tax of Landlord or any income, profits or revenue tax upon the
income of Landlord.

          Section 3.6.   If an event shall occur which constitutes an Event of
Default, Tenant agrees that, within five (5) business days after written demand
made by Landlord, it shall:  (i) deposit with Landlord or Mortgagee (if so
directed by Landlord), on such fifth (5th) business day of demand and on the
first day of each month thereafter until thirty (30) days prior to the date when
the next installment of Impositions is due to the authority or other person to
whom the same is paid, an amount equal to said next installment of Impositions
divided by the number of months over which such deposits are to be made; and
(ii) thereafter during the Term deposit with Landlord or Mortgagee an amount
each month estimated by Landlord or Mortgagee to be adequate to create a fund
which, as each succeeding installment of Impositions becomes due, will be
sufficient, thirty (30) days prior to such due date, to pay such installment in
full.  Notwithstanding the foregoing, Tenant shall have no obligation to deliver
to Landlord any gaming taxes to the extent that such delivery would constitute a
violation of any applicable Gaming Laws.  Landlord or Mortgagee shall use
reasonable efforts to cause the monthly deposits to be equal in amount, but
neither of them shall be liable in the event that such required deposits are
unequal.  If at any time the amount of any Imposition is increased or Landlord
or Mortgagee believes that it will be, said monthly deposits shall be increased
within five (5) business days after written demand by Landlord or Mortgagee so
that, thirty (30) days prior to the due date for each installment of
Impositions, there will be deposits on hand with Landlord or Mortgagee

                                       12
<PAGE>

sufficient to pay such installments in full.  To the extent permitted by
applicable law, Landlord or Mortgagee shall not be required to deposit any such
amounts in an interest bearing account.  For the purpose of determining whether
Landlord or Mortgagee has on hand sufficient moneys to pay any particular
Imposition at least thirty (30) days prior to the due date therefor, deposits
for each category of Imposition shall be treated separately, it being the
intention that Landlord shall not be obligated to use moneys deposited for the
payment of an item not yet due and payable to the payment of an item that is due
and payable.  Notwithstanding the foregoing, it is understood and agreed that
(a) to the extent permitted by applicable law, deposits provided for hereunder
may be held by Landlord or Mortgagee in a single bank account and commingled
with other Imposition escrows of Landlord or Mortgagee, and (b) Landlord or
Mortgagee, may, if Tenant fails to make any deposit required hereunder, use
deposits made for any one item for the payment of the same or any other item of
Rent.  If this Lease shall be terminated by reason of any Event of Default, all
deposits then held by Landlord shall be applied by Landlord on account of any
and all sums due under this Lease; if there is a resulting deficiency, Tenant
shall pay the same, and if there is a surplus, Tenant shall be entitled to a
refund of the surplus.  Landlord agrees to (i) negotiate in good faith with any
Mortgagee so that the Mortgagee does not require such escrow absent a Default
and (ii) cause the amounts paid by Tenant hereunder be applied to such
Impositions, provided such sums are not otherwise applied by Landlord in
accordance with this Section 3.6.
                     -----------

          Section 3.7.   If Landlord ceases to have any interest in the
Premises, Landlord shall transfer to the person or entity who owns or acquires
such interest in the Premises from Landlord and is the transferee of this Lease,
the deposits made pursuant to Section 3.6 hereof, subject, however, to the
                              -----------
provisions thereof.  Upon such transfer of the Premises, the transferor shall be
deemed to be released from all liability with respect thereto (other than with
respect to any misapplication of any Tenant funds) and Tenant agrees to look to
the transferee solely with respect thereto, and the provisions hereof shall
apply to each successive transfer of the said deposits; provided, however, that
transferor shall not be released from liability unless Tenant either receives
said deposits or said deposits continue to be held by Mortgagee for the benefit
of transferee and Tenant.

          Section 3.8.   The provisions of this Article 3 shall survive the
                                                ---------
expiration or earlier termination of this Lease.

                                       13
<PAGE>

                                   ARTICLE 4

                         USE AND OPERATION OF PREMISES
                         -----------------------------

          Section 4.1.   The Premises shall be used and occupied only for the
purposes set forth in Article A, Section 4, as well as the related uses being
                      ---------  ---------
made of the Premises by Tenant.  Throughout the Term, Tenant shall use and
operate the Premises at the same or a superior level of activity and quality as
they are used and continuously operated on the Commencement Date and in no event
inconsistent with the standards applicable to hotels and casinos similar to the
Premises on the Commencement Date in the Laughlin, Nevada area.  Tenant shall
not change the use of the Premises from the use immediately prior to the
Commencement Date without Landlord's consent which shall not be unreasonably
withheld or delayed.  Tenant shall not create or suffer to exist any public or
private nuisance, hazardous or illegal condition or waste on or with respect to
the Premises.

          Section 4.2.   Tenant covenants and agrees to provide and maintain, at
its expense, inventories of Operating Supplies in an amount customary for the
operation of a comparable casino and hotel in the Laughlin, Nevada area (but in
no event less than the amount of Operating Supplies in inventory at the
Commencement Date), and to deliver to Landlord or its designee, upon termination
of this Lease, an inventory of Operating Supplies in an amount not less than the
average amount of Operating Supplies in inventory at the Premises during the two
full calendar years preceding such termination. Notwithstanding the foregoing,
Tenant shall not be required to transfer any alcoholic beverages or Gaming
Equipment to any Person other than a duly licensed entity.

          Section 4.3.   Tenant hereby represents and warrants to Landlord that
all necessary certificates of occupancy, permits, licenses and consents from any
or all appropriate governmental authorities have been obtained by Tenant,
including without limitation, those permits and licenses necessary to lawfully
operate a gambling casino pursuant to a nonrestrictive  gaming license and to
sell alcohol in Clark County, Nevada, and are in full force and effect as may be
required by law for Tenant to occupy the Premises and conduct business thereon.

          Section 4.4.   (a) Tenant covenants and agrees to maintain in and
about the Premises at all times during the Term, such kinds and quantities of
FF&E as are necessary and proper for the operation of the Premises, in
accordance with the requirements of Section 4.1.
                                    -----------

          (b) On the expiration or earlier termination of the Term, Tenant
covenants and agrees that all FF&E shall be owned by Landlord, free and clear of
all liens, leases and other encumbrances.  At the sole election of Landlord
(which election may be made by Landlord at any time during the Term and for
sixty (60) days thereafter, provided that an Event of Default has occurred and
is continuing), all of Tenant's right, title and interest in and to all FF&E
shall vest in Landlord as of the expiration of the Term, and if Landlord shall
make said election, Tenant, upon the request of Landlord, shall promptly execute
and deliver to Landlord such

                                       14
<PAGE>

instruments as Lessor may reasonably request to confirm the transfer to Landlord
of Tenant's right, title and interest in all FF&E.

          Section 4.5.   Tenant covenants and agrees that for each Lease Year
during the Term, Tenant shall devote an amount equal to the greater of (a)
$1,000,000 per Lease Year or (b) four percent (4%) of Gross Room Revenue for
said Lease Year (the "Annual Maintenance Expense") for the repair, maintenance
and refurbishment of the Premises existing as of the commencement of such Lease
Year.  The accomplishment of such items shall be effected by the monthly funding
of a reserve (the "Reserve") or by direct expenditure by Tenant for the
foregoing purposes.

          Section 4.6.   Within ninety (90) days after the end of each Lease
Year, Tenant shall deliver to Landlord a statement certified by a financial
officer of Tenant detailing the Annual Maintenance Expense for such Lease Year.
If the Annual Maintenance Expense actually due for such Lease Year shall be less
than the amount actually paid into the Reserve and paid directly by Tenant as
required by Section 4.5, Tenant shall promptly pay the difference into the
            -----------
Reserve.

          Section 4.7.   The Reserve shall be established in an interest bearing
bank account under the control of Tenant in a commercial bank selected by Tenant
and reasonably approved by Landlord.  Interest earned on the Reserve shall be
disbursed annually to Tenant, provided that Tenant is not in default of its
obligations under this Lease.  In the event that Tenant acquires the Premises
pursuant to Article 23, 24, 25 or 26, the Reserve shall be disbursed to Tenant
            ------------------------
at Closing.  Otherwise, upon the expiration or earlier termination of this
Lease, all sums remaining in the Reserve shall be the property of, and shall be
paid to, Landlord (provided, however, that such sums shall be utilized for the
benefit and improvement of the Premises and in the event of termination of the
Lease by reason of a sale of the Premises, the Reserve shall be assigned to the
purchaser as a part of such sale) and the same shall not be credited against any
obligation of Tenant hereunder.

          Section 4.8.   Promptly upon the commencement of each Lease Year,
Tenant shall deliver to Lessor a budget reasonably detailing Tenant's projected
Annual Maintenance Expense for such Fiscal Year together with any longer-term
budget, or revisions thereto, for Annual Maintenance Expense for succeeding
Lease Years.  It is the intention of the parties that Annual Maintenance Expense
shall be used to maintain the quality and condition of Premises, that both
parties shall be reasonable in assessing the nature and purpose of such
maintenance expenditures and the Tenant shall have control over day-to-day such
maintenance expenditures.

          Section 4.9.   Tenant covenants and agrees that during the Term it
will strictly comply with the financial covenants set forth in Schedule 1
                                                               ----------
attached hereto and incorporated herein by this reference.

                                       15
<PAGE>

                                   ARTICLE 5

                CONDITION OF PREMISES, ALTERATIONS AND REPAIRS
                ----------------------------------------------

          Section 5.1.   The parties acknowledge that Landlord purchased fee
title to the Land and Improvements and the lessee's interest in the Ground Lease
directly from an Affiliate of Tenant.  In connection with such purchase, Tenant
and Landlord have entered into this Lease to enable Tenant to retain possession
and use of the Premises subject to the terms and conditions hereof.  In
connection with Tenant's prior ownership and prior and continuing possession of
the Premises, Tenant has examined the Premises, is familiar with the physical
condition, expenses, operation and maintenance, zoning, status of title and use
that may be made of the Premises and every other matter or thing affecting or
related to the Premises, and is leasing the same in its "As Is" condition.
Landlord has not made and does not make any representations or warranties
whatsoever with respect to the Premises or otherwise with respect to this Lease,
express or implied, including any warranty regarding the suitability of the
Premises for their intended commercial purposes.  Tenant assumes all risks
resulting from any defects (patent or latent) in the Premises or from any
failure of the same to comply with any governmental law or regulation applicable
to the Premises or the uses or purposes for which the same may be occupied.

          Section 5.2.   At Tenant's sole cost and expense, Tenant shall keep
the Buildings and the adjoining sidewalks and curbs, if any, clean and in good
condition and repair, free of accumulations of dirt, rubbish, snow and ice, and
Tenant shall make all repairs and replacements, structural and non-structural,
ordinary and extraordinary, foreseen and unforeseen, and shall perform all
maintenance, necessary to maintain the Premises and any sidewalks and curbs in
good condition and repair.  When used in this Section 5.2, the term "repairs"
                                              -----------
shall include all necessary or desirable additions, alterations, improvements,
replacements, renewals and substitutions.  All repairs made by Tenant shall be
equal or superior in quality and class to the original work and shall be made in
compliance with all Requirements (hereinafter defined).  Landlord shall not be
required to furnish any services or facilities or to make any repairs or
alterations to the Premises, and Tenant hereby assumes the full and sole
responsibility for the condition, operation, repair, replacement, maintenance
and management of the Premises and all costs and expenses incidental thereto,
including adequate security for the Buildings.  Tenant shall have the roof
inspected with reasonable frequency by an appropriate consultant reasonably
acceptable to Landlord, at Tenant's expense.  Tenant shall, at is sole cost and
expense, repair and maintain the roof in good condition.  Any repair of the roof
(including the roof membrane, and supporting elements), the foundation, the
floor slab, and the load bearing and exterior walls shall be deemed a
"structural" Alteration.

          Section 5.3.   Landlord shall not be responsible for the cost of any
alterations of or repairs to the Premises of any nature whatsoever, structural
or otherwise, whether or not now in the contemplation of the parties.  To the
extent not prohibited by law, Tenant hereby waives and releases all rights now
or hereinafter conferred by statute or otherwise which would have the effect of
limiting or modifying any of the provisions of this Article 5.

                                       16
<PAGE>

          Section 5.4.   Tenant shall have the right at any time and from time
to time during the Term to make, at its sole cost and expense, changes,
alterations, additions or improvements (collectively, "Alterations") in or to
the Premises, subject, however, in each case to all of the following:

                 (a) No Alteration shall be undertaken except after twenty (20)
days' prior notice to Landlord, provided that no such notice shall be required
with respect to (i) any nonstructural Alteration or (ii) any Alteration made by
Tenant on an emergency basis, in which case Tenant shall notify Landlord of such
emergency Alteration as soon as practicable.

                 (b) No structural Alteration or Alteration to the exterior of
the Buildings shall be made without the prior written consent of Landlord, which
consent shall not be unreasonably withheld or delayed and which shall be deemed
given if Landlord fails to respond to such request within thirty (30) days of
Landlord's receipt of such request.

                 (c) Any Alteration shall, when completed, be of such a
character as not to reduce the value, utility or useful life of the Premises
below that immediately before such Alteration. If Landlord has given its
approval to any Alteration, it shall be presumed that the Alteration does not
reduce the value of the Premises absent a showing that materials and/or
construction techniques have been utilized in the actual construction of the
Alteration which are inferior in quality, composition or performance to those
described in the request for Landlord's consent.

                 (d) The written consent of the holders of any Mortgages must be
obtained before the commencement of any work hereunder, except work permitted
under paragraph (a) above, whenever such consent shall be necessary under the
provisions of any such Mortgage, provided, however, if any delay or refusal of
                                 --------  -------
consent by the holders of any Mortgages would result in the violation of any
Requirements, Tenant shall have the right to perform such Alteration as may be
necessary to comply with such Requirements without receiving such consent but
otherwise in compliance with the requirements of this Article 5.

                 (e) Landlord shall have no obligation to grant its consent to
any Alteration proposed by Tenant which would reduce the value, utility or
useful life of the Premises below that immediately before such Alteration or
which materially reduces the square footage of the Buildings being altered or
weakens, temporarily or permanently, the structure of the Buildings being
altered or any part thereof, or enables Tenant to conduct activity inconsistent
with the limitations upon its use as stated in Article 4. For purposes of this
                                               ---------
subsection (e), a material reduction shall be deemed to mean a reduction of the
square footage of the Buildings of two percent (2%) or more.

                 (f) The reasonable cost and expense of Landlord's and
Mortgagee's review of any plans and specifications required to be furnished to
Landlord and Mortgagee pursuant to Section 5.5 hereof shall be paid by Tenant to
                                   -----------
Landlord, within ten (10) days after written demand, or, at the option
of Landlord, as Additional Rent.

                                       17
<PAGE>

               (g)  The provisions and conditions of Section 5.5 shall apply to
                                                     -----------
any work performed by Tenant under this Article.

               (h)  For purposes of Sections 5.4 and 5.5, notice of whether
                                    --------------------
Landlord's consent has been given or withheld shall be delivered to Tenant
within twenty (20) days following receipt of Tenant's request (as such time
period shall be extended for a reasonable period not to exceed thirty (30) days
in the event that the cost of such Alteration is estimated to exceed $1,000,000
and Landlord determines, in its reasonable discretion, that it is prudent to
engage a third party to review the plans and specifications, if any, pertaining
to such contemplated Alteration), provided, however, in the event that Landlord
                                  --------  -------
has not responded to Tenant's request within ten (10) days following its receipt
thereof, Tenant shall send a second notice to Landlord renewing Tenant's request
for Landlord's consent, stating that such notice is the second notice pursuant
to this Section 5.4(h), and stating that unless Landlord responds to such second
        --------------
notice within ten (10) days of Landlord's receipt thereof, Landlord shall be
deemed to have consented to Tenant's request for Landlord's consent to such
Alteration.

          Section 5.5.   Tenant agrees that all Alterations, repairs,
Restoration (hereinafter defined) and other work which Tenant shall be required
or permitted to do under the provisions of this Lease (each hereinafter called
the "Work") shall be (i) performed in a good, workmanlike manner, and in
accordance with all Requirements, as well as any plans and specifications
therefor which shall have been approved by Landlord (if such approval is
required hereunder), (ii) commenced and completed promptly and (iii) done in all
cases upon and subject to the terms of any Non-Disturbance Agreement and, to the
extent not inconsistent with any term thereof, all of the following terms and
conditions:

               (a)  If the Work shall involve any structural repair, structural
Alterations, Restoration or other structural Work, then the Work shall not be
commenced until detailed plans and specifications (including layout,
architectural, mechanical and structural drawings), prepared by a licensed
architect reasonably satisfactory to Landlord shall have been submitted to and
approved by Landlord, which approval shall not be unreasonably withheld or
delayed.

               (b)  No Work involving structural repair, structural Alteration,
Restoration nor other structural work shall be undertaken except under the
supervision of a licensed architect or other appropriate design professional
reasonably satisfactory to Landlord.

               (c)  All Work shall be commenced only after all required
municipal and other governmental permits, authorizations and approvals shall
have been obtained by Tenant, at its own cost and expense, and the originals or
certified copies thereof delivered to Landlord. Landlord will, on Tenant's
written request, execute any documents necessary to be signed by Landlord to
obtain any such permits, authorizations and approvals, provided that Tenant
shall discharge any expense or liability of Landlord in connection therewith.

               (d)  The cost of all Work shall be paid promptly, in cash, so
that the Premises and Tenant's leasehold estate therein shall at all times be
free from (i) liens for labor or

                                       18
<PAGE>

materials supplied or claimed to have been supplied to the Premises or Tenant,
and (ii) chattel mortgages, conditional sales contracts, title retention
agreements, security interests and agreements, and financing agreements and
statements.

               (e)  At all times when any Work is in progress, Tenant shall
maintain or cause to be maintained with such companies and for such periods as
Landlord may require (i) worker's compensation insurance covering all persons
employed in connection with the Work, in an amount at least equal to the minimum
amount of such insurance required by law (with a waiver of subrogation
reasonably satisfactory to Landlord); and (ii) for the mutual protection of
Landlord, Tenant and any Mortgagee, (1) builder's risk insurance, completed
value form, covering all physical loss, in an amount reasonable satisfactory to
Landlord, and (2) commercial general liability insurance against all hazards,
with limits for bodily injury or death to any one person, for bodily injury or
death to any number of persons in respect of any one accident or occurrence, and
for property damage in respect of one accident or occurrence in such amounts as
Landlord may require. Such commercial general liability insurance may be
satisfied by the insurance required under Section 6.1(a), but may be effected by
                                          --------------
an endorsement, if obtainable, upon the insurance policy referred to in said
Section. The provisions and conditions of Article 6 hereof shall apply to any
                                          ---------
insurance which Tenant shall be required to maintain or cause to be maintained
under this subsection.

               (f)  Upon completion of any Work, Tenant, at Tenant's expense,
shall obtain certificates of final approval of such Work required by any
governmental or quasigovernmental authority and shall furnish Landlord with
copies thereof, together with "as-built" plans and specifications for such Work
(if the cost of such Work exceeds the Threshold Amount).

               (g)  The conditions of Section 5.4 shall have been complied with,
                                      -----------
to the extent applicable to the Work.

          Section 5.6.   Following the delivery of prior reasonable notice, any
Work shall be subject to inspection at any time and from time to time by
Landlord, its architect and Mortgagee, or their duly authorized representatives,
and if Landlord's architect or Mortgagee upon any such inspection shall be of
the opinion, which opinion shall not be unreasonable, that the Work is not being
performed substantially in accordance with the provisions of this Article 5 or
                                                                  ---------
the plans and specifications, or that any of the materials or workmanship are
not of good quality or are unsound or improper, Tenant shall correct any such
failure and shall replace any unsound or improper materials or workmanship.

          Section 5.7.   All fixtures, structures and other improvements
installed in or upon the Premises at any time during the Term (except for
Tenant's Gaming Equipment) shall become the property of Landlord and shall
remain upon and be surrendered with the Premises.  Tenant shall have no
obligation to remove or demolish any fixtures, structures or other improvements
which are installed on the Premises on the Commencement Date. Subject to the
provisions of Section 4.4(b), all Personal Property shall become the property of
              --------------
Landlord on the Expiration

                                       19
<PAGE>

Date. Prior to the commencement of any Work or any Alteration in accordance
Section 5.4, Landlord will, upon written request by Tenant, notify Tenant
-----------
whether Landlord will require such Alterations to be removed from the Premises
prior to the Expiration Date or earlier termination of this Lease. All property
permitted or required to be removed by Tenant at the end of the Term remaining
in the Premises after Tenant's removal shall be deemed abandoned and may, at the
election of Landlord, either be retained as Landlord's property or may be
removed from the Premises by Landlord at Tenant's expense. Tenant shall be
responsible for, and shall reimburse Landlord within ten (10) days after written
demand therefor, any damage to the Premises caused in whole or in part by the
removal or demolition of Tenant's fixtures, structures or other improvements
which Tenant is required to remove pursuant to this Section 5.7 or which Tenant
                                                    -----------
elects under the provisions of this Lease to remove. The provisions of this
Section 5.7 shall survive the expiration or earlier termination of the Term.
-----------

                                   ARTICLE 6
                                   ---------

                                   INSURANCE
                                   ---------

          Section 6.1.   Throughout the Term, Tenant shall, at its own cost and
expense, provide and keep in force, for the benefit of Landlord, Tenant and any
Mortgagee:

               (a)  broad form commercial general liability insurance (including
protective liability coverage on operations of independent contractors engaged
in construction to the extent necessary by reason of Alterations and blanket
contractual liability insurance) protecting and indemnifying Landlord, Tenant
and any Mortgagee against all claims for damages to person or property or for
loss of life or of property occurring upon, in, or about the Premises, if any,
written on an occurrence basis with an aggregate limit of not less than
$50,000,000 and an individual occurrence limit of not less than $50,000,000, or
such greater limits as may be required from time to time by any Mortgagee or as
may be reasonably required from time to time by Landlord consistent with
insurance coverage on properties similarly constructed, occupied and maintained.
Such coverage shall contain endorsements:  (i) including cross-liability; and
(ii) waiving the insurer's rights of subrogation against Landlord for events of
which Landlord is not, but Tenant is, covered;

               (b)  property insurance in respect of the Premises and all
installations, additions and improvements which may now or hereafter be erected
thereon, insuring against loss or damage by fire and such other risks as are now
or hereafter embraced by "extended coverage" policy in an amount sufficient to
prevent Landlord and Tenant from becoming co-insurers and in any event in an
amount not less than one hundred percent (100%) of the actual replacement value
thereof (i.e., including the cost of debris removal but excluding foundations
and excavations) as reasonably determined by Landlord from time to time.  Such
coverage shall contain an agreed value endorsement acceptable to Landlord;

               (c)  business interruption insurance covering risk of loss due to
the

                                       20
<PAGE>

occurrence of any of the hazards covered by the insurance to be maintained by
Tenant described in Section 6.1(b) with coverage in a face amount of not less
                    --------------
than the aggregate amount, for a period of twelve (12) months following the
insured-against peril, of 100% of all Rent (which includes all Impositions and
other amounts specified in the definition of Rent) to be paid by Tenant under
this Lease;

               (d)  worker's compensation insurance (including employers'
liability insurance), with a waiver of subrogation reasonably satisfactory to
Landlord, covering all persons employed at the Premises by Tenant to the extent
required by the laws and statutes of the State in which the Premises are
located, including, without limitation, during the course of work to the
Premises;

               (e)  boiler insurance, if applicable, in an amount not less than
one hundred percent (100%) of the actual replacement value thereof and of any
improvements in which any such boiler is located (including the cost of debris
removal but excluding foundations and excavations) as reasonably determined by
Landlord from time to time;

               (f)  if sprinkler systems are located in the Buildings, sprinkler
leakage insurance in amounts reasonably approved by Landlord;

               (g)  endorsements for liquor liability and innkeepers liability
which coverage shall include safe deposit box legal liability; and

               (h)  such other or further insurance, in such amounts and in such
form, as is customarily obtained by owners of properties similarly constructed,
occupied and maintained and is available at commercially reasonable rates, or as
otherwise reasonably required by any Mortgagee, provided that it shall be
commercially reasonable to add any such additional coverage because of the
specific uses of Premises.

          Section 6.2.   Whenever under the terms of this Lease Tenant is
required to maintain insurance for the benefit of Landlord, (i) Landlord shall
be an additional insured in all such liability insurance policies and (ii)
either Landlord or Mortgagee, as specified in Section 6.3, shall be named as
                                              -----------
loss payee in all such casualty insurance policies.  In the event that the
Premises shall be subject to a Mortgage, the commercial general liability
insurance shall name the Mortgagee (together with any trustee or servicer
therefor) as an additional insured and all other insurance provided hereunder
shall name the Mortgagee as an additional insured or, as provided in Section
                                                                     -------
6.3, loss payee under a standard "non-contributory mortgagee" endorsement or its
---
equivalent.  All policies of insurance shall provide that such coverage shall be
primary and that any insurance maintained separately by Landlord or the
Mortgagee shall be excess insurance only.  The original certificates (on Acord
Form 27 or its equivalent in the case of casualty and on insurance company
letterhead in the case of liability or in a form otherwise acceptable to
Landlord) shall be delivered to Landlord and any Mortgagee.  All insurance shall
contain endorsements to the effect that the act or omission of Tenant or
Mortgagee, any occupancy or use of the Premises for purposes more hazardous than
permitted by such policy, any foreclosure

                                       21
<PAGE>

or other proceedings relating to the Premises or any change in title to or
ownership of the Premises will not invalidate the policy as to Landlord or such
Mortgagee.

          Section 6.3.   The loss under all insurance policies insuring against
property damage to the Buildings shall be payable to Mortgagee or, if there is
none, to Landlord, subject to Section 7.2.  All property insurance policies
                              -----------
required by this Lease shall provide that all adjustments for claims with the
insurers in excess of Five Hundred Thousand Dollars ($500,000.00) (exclusive of
any deductible) shall be made with Landlord and Tenant except in the last Lease
Year, in which event Landlord alone shall control the adjustment and settlement
of such claim.  Any adjustments for claims with the insurers involving sums of
Five Hundred Thousand Dollars ($500,000.00) (exclusive of any deductible) or
less shall be made with Tenant.

          Section 6.4.   All of the above-mentioned insurance certificates shall
be obtained by Tenant and delivered to Landlord on or prior to the date hereof,
and thereafter as provided for herein, and shall be written by insurance
companies:  (i) rated A-/X or better in "Best's Insurance Guide" (or any
substitute guide acceptable to Landlord); (ii) authorized to do business in the
state where the Premises are located; and (iii) of recognized responsibility and
which are satisfactory to Landlord.  Any deductible amounts under any insurance
policy hereunder shall not exceed $50,000 per occurrence, except with respect to
flood and earthquake insurance which may have deductibles of $100,000 per
occurrence and business interruption coverage for which a deductible may not
exceed two (2) days income.

          Section 6.5.   At least thirty (30) days prior to the expiration of
any policy or policies of such insurance, Tenant shall renew such insurance, by
delivering to Landlord or Mortgagee, within the said period of time, the
original certificates of insurance, endorsed in accordance with Section 6.2
                                                                -----------
hereof, together with insurance binders evidencing the coverage described in
this Article 6.  All coverage described in this Article 6 shall be endorsed to
     ---------                                  ---------
provide Landlord and Mortgagee with thirty (30) days' notice of cancellation or
change in terms.  If Tenant shall fail to procure the insurance required under
this Article 6 in a timely fashion or to deliver such certificates to Landlord,
     ---------
Landlord may, at its option and in addition to Landlord's other remedies in the
event of a Default by Tenant, upon written notice to Tenant, procure the same
for the account of Tenant, and the cost thereof shall be paid to Landlord as
Additional Rent.

          Section 6.6.   Tenant shall not violate, or permit to be violated, any
of the conditions of any of the said policies of insurance, and Tenant shall
perform and satisfy the requirements of the companies writing such policies so
that companies of good standing, reasonably satisfactory to Landlord, shall be
willing to write and/or continue such insurance.

                                       22
<PAGE>

          Section 6.7.   Tenant shall not carry separate or additional insurance
affecting the coverage described in this Article 6, concurrent in form and
                                         ---------
contributing in the event of any loss or damage to the Premises with any
insurance required to be obtained by Tenant under this Lease, unless such
separate or additional insurance shall comply with and conform to all of the
provisions and conditions of this Article.  Tenant shall promptly give notice to
Landlord of such separate or additional insurance.

          Section 6.8.   The insurance required by this Lease, at the option of
Tenant, may be effected by blanket and/or umbrella policies issued to Tenant
covering the Premises and other properties owned or leased by Tenant, provided
that the policies otherwise comply with the provisions of this Lease and
allocate to the Premises 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 Landlord or Mortgagee
insurance certificates, with schedules thereto attached showing the amount of
insurance afforded by such policies applicable to the Premises.

                                   ARTICLE 7
                                   ---------

                             DAMAGE OR DESTRUCTION
                             ---------------------

          Section 7.1.   If the Premises or any Building or any part thereof
shall be damaged or destroyed by fire or other casualty (including any casualty
for which insurance was not obtained or obtainable) of any kind or nature,
ordinary or extra-ordinary, foreseen or unforeseen, (a) Landlord shall pay over
to Tenant, upon the terms set forth in Section 7.2, any moneys which may be
                                       -----------
recovered by Landlord from property insurance, (b) this Lease shall be
unaffected thereby and shall continue in full force and effect, (c) Tenant shall
take all measures necessary to preserve its gaming license and (d) Tenant shall,
at Tenant's sole cost and expense, expeditiously and in a good and workmanlike
manner, cause such damage or destruction to be remedied or repaired (the
"Restoration") by restoring the Premises to substantially the same condition and
configuration immediately prior to such damage or destruction subject to such
modifications as may be necessary to any applicable Requirements; provided,
                                                                  --------
however, Tenant shall not be obligated to perform any Restoration (1) during the
-------
last Lease Year, unless the Term has been extended or (2) if the damage or
destruction is of such a nature that it renders Restoration uneconomical or
causes the Premises to be permanently unfit for any use permitted pursuant
Article A, Section 4 and the provision of Article 26 shall apply to such events.
--------------------                      ----------
Any event described in subsections 7.1(1) and (2) above shall herein be referred
                       --------------------------
to as an "Event of Loss".  All Restoration work shall be performed in accordance
with the provisions of this Lease, including, without limitation, the provisions
of Sections 5.4 and 5.5 hereof.  Tenant hereby waives the provisions of any law
   --------------------
or statute to the contrary and agrees that the provisions of this Article shall
govern and control in lieu thereof.  If Tenant shall fail or neglect to restore
the Premises with reasonable diligence, or having so commenced such Restoration,
shall fail to complete the same with reasonable diligence, or if prior to the
completion of any such Restoration by Tenant, this Lease shall expire or be
terminated for any reason, Landlord shall

                                       23
<PAGE>

have the right, but not the obligation, to complete such Restoration at Tenant's
cost and expense and the cost thereof shall be payable within five (5) days
after written demand as Additional Rent, together with interest thereon from the
date of demand until paid at the Default Rate. In addition, if Landlord so
completes the Restoration as provided hereunder, Landlord shall be entitled to a
reasonable supervisory fee from Tenant to compensate Landlord for administering
the Restoration.

          Section 7.2.   (a) In the event of the sale of the Premises to Tenant
pursuant to Article 26 following an Event of Loss, the insurance proceeds
            ----------
received by Landlord shall be paid to Tenant and the right to receive proceeds
and make claims under the property insurance policy shall be assigned to Tenant
at the closing of such sale.

               (b)  Except as provided in Section 7.2(a) and subject to the
                                          --------------
provisions of this Article 7, Landlord shall pay over to Tenant from time to
                   ---------
time, upon the following terms, any moneys which may be received by Landlord
from property insurance provided by Tenant but, in no event, to any extent or in
any sum exceeding the amount actually collected by Landlord upon the loss;
provided, however, that Landlord, before paying such moneys over to Tenant,
--------  -------
shall be entitled to reimburse itself therefrom to the extent, if any, of the
expenses paid or incurred by Landlord in the collection of such moneys. Landlord
shall pay to Tenant, as herein provided, the aforesaid insurance proceeds, for
the purpose of Restoration to be made by Tenant to restore the Premises to a
value which shall be not less than a value substantially similar to the value of
the Premises prior to such fire or other casualty. Prior to making any
Restoration, Tenant shall furnish Landlord with an estimate of the cost of such
Restoration, prepared by a licensed third party architect or contractor selected
by Tenant and reasonably approved by Landlord. If Landlord has given its
approval to any such Restoration, it shall be presumed that the Restoration does
not reduce the value of the Premises absent a showing that materials and/or
construction techniques have been utilized in the actual construction of the
Restoration which are inferior in quality, composition or performance to those
described in the request for Landlord's consent. Such insurance moneys shall be
paid to Tenant (or, at Landlord's option, directly to the party to whom such
payment is due) from time to time thereafter in installments as the Restoration
progresses, upon application to be submitted by Tenant to Landlord showing the
cost of labor and material incorporated in the Restoration, or incorporated
therein since the last previous application.

               (c)  If any vendor's, mechanic's, laborer's, or materialman's
lien is filed against the Premises or any part thereof, or if any public
improvement lien is created or permitted to be created by Tenant and is filed
against Landlord, or any assets of, or funds appropriated to, Landlord, Tenant
shall not be entitled to receive any further installment until such lien is
satisfied or otherwise discharged, unless such lien is contested by Tenant in
good faith and Tenant has obtained and delivered a bond issued by a surety, in
an amount and in form otherwise reasonably satisfactory to Landlord. The amount
of any installment to be paid to Tenant shall be such proportion of the total
insurance moneys received by Landlord as the cost of labor and materials
theretofore incorporated by Tenant in the Restoration bears to the total

                                       24
<PAGE>

estimated cost of the Restoration by Tenant, less (a) all payments theretofore
made to Tenant out of said insurance proceeds, and (b) ten percent (10%) of the
amount so determined (the "Retainage"). Notwithstanding the foregoing, Landlord
shall not withhold the Retainage from any installment provided (i) such
installment constitutes the final payment due a contractor or materialman, or
(ii) the contractor is bonded and Tenant furnishes to Landlord payment and
performance bonds and labor and material bonds of Tenant's contractor reasonably
satisfactory to Landlord, naming Landlord as co-obligee, in which event Landlord
shall withhold from such installment the same percentage withheld by Tenant
pursuant to the construction contract. Upon completion of and payment for the
Restoration by Tenant, including reimbursement to Tenant of the Retainage or
other amount, as applicable, the balance of any and all insurance proceeds held
by Landlord shall be paid to Tenant. In the event that the insurance proceeds
are insufficient for the purpose of paying for the Restoration, Tenant shall
nevertheless be required to make the Restoration and pay any additional sums
required for the Restoration in accordance with the provisions of Section 7.4
                                                                  -----------
hereof. Notwithstanding the foregoing, if Landlord makes the Restoration at
Tenant's expense, as provided in Section 7.1 hereof, then Landlord shall use any
                                 -----------
amounts held by Landlord to pay for the cost of such Restoration and any costs
incurred by Landlord as a result of any delays in completing such Restoration.

          Section 7.3.   The following shall be conditions precedent to each
payment made to Tenant (or to any other party) as provided in Section 7.2 above:
                                                              -----------

          (a) there shall be submitted to Landlord the certificate of the
aforesaid architect or contractor stating (i) that the sum then requested to be
withdrawn either has been paid by Tenant and/or is justly due to contractors,
subcontractors, materialmen, engineers, architects or other persons (whose names
and addresses shall be stated) who have rendered or furnished certain services
or materials for the work and giving a brief description of such services and
materials and the principal subdivisions or categories thereof and the several
amounts so paid or due to each of such persons in respect thereof, and stating
in reasonable detail the progress of the work up to the date of said
certificate, (ii) that no part of such expenditures has been or is being made
the basis, in any previous or then pending request, for the withdrawal of
insurance money or has been made out of the proceeds of insurance received by
Tenant, (iii) that the sum then requested does not exceed the value of the
services and materials described in the certificate and (iv) that the balance of
any insurance proceeds held by Landlord, together with such other sums, if any,
which Tenant has made or will (for which evidence of Tenant's intention and
ability shall be to Landlord's reasonable satisfaction) make available for the
Restoration in accordance with Section 7.4 hereof and to Landlord's satisfaction
                               -----------
will be sufficient upon completion of the Restoration to pay for the same in
full, and stating in reasonable detail an estimate of the cost of such
completion;

          (b) there shall be furnished to Landlord an official search, or a
certificate of a title insurance company satisfactory to Landlord, or other
evidence satisfactory to Landlord, showing that there has not been filed any
vendor's, mechanic's, laborer's or materialman's statutory or other similar lien
affecting the Premises or any part thereof, or any public improvement lien
created or permitted to be created by Tenant affecting Landlord, or the assets

                                       25
<PAGE>

of, or funds appropriated to, Landlord, which has not been discharged of record,
except such as will be discharged upon payment of the amount then requested to
be withdrawn, or

unless any such lien is contested by Tenant in good faith and Tenant has
obtained and delivered a bond issued by a surety, in an amount and in form
otherwise reasonably satisfactory to Landlord; and

               (c)  at the time of making such payment, no Default shall have
occurred and be continuing.

          Section 7.4.   If the estimated cost of any Restoration, determined as
provided in Section 7.2 hereof, exceeds the net insurance proceeds by an amount
            -----------
equal to or greater than $2,500,000.00, then, prior to the commencement of any
Restoration, Tenant hereby covenants to deposit with Landlord a bond, cash or
other security reasonably satisfactory to Landlord in the amount of such excess,
to be held and applied by Landlord in accordance with the provisions of Section
                                                                        -------
7.2 hereof, as security for the completion of the work, free of public
---
improvement, vendors', mechanics', laborers' or materialmen's statutory or other
similar liens.

          Section 7.5.   As material consideration to Landlord for its agreement
to enter into this Lease, the parties agree that this Lease shall not terminate
or be forfeited or be affected in any manner, and there shall be no reduction or
abatement of the Rent payable hereunder, by reason of damage to or total,
substantial or partial destruction of the Premises or any part thereof or by
reason of the untenantability of the same or any part thereof, for or due to any
damage or destruction of the Premises from any cause whatsoever, and,
notwithstanding any law or statute, present or future, Tenant waives any and all
rights to quit or surrender the Premises or any part thereof on account of any
damage or destruction of the Premises.  Tenant expressly agrees that its
obligations hereunder, including the payment of Rent payable by Tenant
hereunder, shall continue as though the Premises had not been damaged or
destroyed and without abatement, suspension, diminution or reduction of any
kind.

          Section 7.6.   Subject to Tenant's reasonable approval, any different
procedure for the Restoration of the Premises which may be required under any
Mortgage shall take precedence over and be in lieu of any contrary procedure
provided for in this Lease.  It shall not be unreasonable for Tenant to deny
approval for any procedure which deprives Tenant of insurance proceeds for
Restoration or materially increases the cost, or delays completion, of the
Restoration.

                                       26
<PAGE>

                                   ARTICLE 8
                                   ---------

                                  CONDEMNATION
                                  ------------

          Section 8.1.   If the whole of the Premises shall be taken, or thirty
(30%) percent or more of the square footage of the Buildings and/or the Land is
taken and as a result thereof Tenant cannot reasonably conduct its business at
the Premises, by condemnation or other eminent domain proceedings pursuant to
any law, general or special (a "Taking"), then on the date that Tenant is
deprived of physical possession of the Premises by reason of such taking (the
"Taking Date"), (i) the Premises shall be sold as provided in Article 26, (ii)
                                                              ----------
this Lease shall terminate upon the Closing of the sale of the Premises, (iii)
all Rent required to be paid by Tenant under this Lease shall be paid up to the
Closing Date, (iv) any award received by Landlord and any rights which Landlord
may have to receive any award in connection with such condemnation or other
eminent domain proceedings shall be paid over, or assigned, as the case may be,
to Tenant upon the closing of the sale of Premises pursuant to Article 26,
                                                               ----------
failing which such award shall be retained by Landlord.  Tenant shall however
have the right to make a separate claim for the value of its trade fixtures, for
relocation benefits and moving expenses and the value of its leasehold estate.
Upon such termination, this Lease shall be of no further force and effect,
except that any obligation or liability of either party, actual or contingent,
under this Lease which has accrued on or prior to such termination date shall
survive and any prepayment of Rent shall be prorated between the parties.

          Section 8.2.   If less than all of the Premises shall be so taken and

Section 8.1 does not apply, Landlord shall have the following options:
-----------

               (a)  this Lease shall be unaffected by such taking, and Tenant
shall continue to pay the Fixed and Additional Rent pursuant to Article 2, and
                                                                ---------
Landlord shall pay over to Tenant any moneys which may be received by Landlord
on account of exercise of the power of eminent domain with respect to the
Premises; provided, however, that Landlord, before paying such moneys over to
          --------  -------
Tenant, shall be entitled to reimburse itself therefrom to the extent, if any,
of the reasonable expenses paid or incurred by Landlord in the collection of
such moneys.  Such moneys shall be paid over to Tenant on the terms and subject
to the conditions set forth in Article 7, as if, for this purpose, such moneys
                               ---------
were insurance proceeds resulting from casualty to the Premises.  Tenant agrees
to undertake such repair and restoration on such terms and subject to such
conditions; or

               (b)  the Fixed Rent payable by Tenant pursuant to Article 2 shall
                                                                 ---------
be reduced by an amount equal to the product of the Fixed Rent then payable
times the lesser of (i) the percentage of the square footage of the Improvements
so taken at the time of such taking, or (ii) the percentage that the award for
such taking bears to the then fair market value of the entire Premises. Landlord
shall be entitled to receive the entire award in any proceeding with respect to
such taking without deduction therefrom for any estate vested in Tenant by this
Lease and Tenant shall receive no part of such award.

                                       27
<PAGE>

          Section 8.3.   If only unimproved land shall be so taken and Sections
                                                                       --------
8.1 and 8.2 do not apply, this Lease shall be unaffected by such taking, and
-----------
Tenant shall continue to pay the Fixed and Additional Rent pursuant to Article
                                                                       -------
2, and Landlord shall be entitled to receive the entire award in any proceeding
-
with respect to such taking without deduction therefrom for any estate vested in
Tenant by this Lease and Tenant shall receive no part of such award.  In the
event that Landlord receives an award pursuant to this Section 8.3, the award so
                                                       -----------
received shall be credited dollar-for-dollar against (a) the Early Purchase
Option amounts otherwise due to Landlord pursuant to Section 25.2 and (b) the
                                                     ------------
Stipulated Loss Values set forth on Exhibit E.
                                    ---------

          Section 8.4.   If the temporary use or occupancy of all or any part of
the Premises shall be lawfully taken by condemnation or in any other manner for
any public or quasi-public use or purpose during the Term of this Lease, Tenant
shall be entitled, except as hereinafter set forth, to receive that portion of
the award for such taking which represents compensation for the use and
occupancy of the Premises and, if so awarded, for the taking of Tenant's
inventory, movable trade fixtures, machinery and for moving expenses, and that
portion which represents reimbursement for the cost of Restoration of the
Premises.  This Lease shall be and remain unaffected by such taking and Tenant
shall be responsible for all obligations hereunder not affected by such taking
and shall continue to pay in full when due the Fixed Rent, Additional Rent and
all other sums required to be paid by Tenant pursuant to the provisions of this
Lease.  If the period of temporary use or occupancy shall extend beyond the
Expiration Date, that part of the award which represents compensation for the
use or occupancy of the Premises (or a part thereof) shall be divided between
Landlord and Tenant so that Tenant shall receive so much thereof as represents
the period to and including the Expiration Date and Landlord shall receive so
much as represents the period subsequent to the Expiration Date and Landlord
shall be entitled to receive that portion which represents reimbursement for the
cost of Restoration of the Premises.

          Section 8.5.   In the event of any taking of the Premises which does
not result in a termination of this Lease, or in the event of a taking for the
temporary use or occupancy of all or any part of the Premises, Tenant at
Tenant's expense, subject to the provisions of Articles 5 and 7 and whether or
                                               ----------------
not any award or awards shall be sufficient for the purpose, shall proceed with
reasonable diligence to repair, alter and restore the remaining parts of the
Premises to substantially the condition existing immediately prior to the date
of taking to the extent that the same may be feasible and so as to constitute a
complete and tenantable Premises.  If the proceeds of such award or awards are
not suffi  cient to pay the full cost thereof, Tenant shall pay such deficit and
shall deposit with Land  lord, in the event such shortfall is equal to or
greater than $500,000.00, a bond, cash or other security reasonably satisfactory
to Landlord and Mortgagee in the amount of such deficiency to be held as
security for the completion of such work.

                                       28
<PAGE>

                                   ARTICLE 9

                           ASSIGNMENT AND SUBLETTING
                           -------------------------

          Section 9.1.   (a)  Except in strict accordance with the provisions of
this Article 9, Tenant shall not sell, assign, mortgage, encumber or otherwise
     ---------
transfer, directly or indirectly (collectively, "Transfer"), all or any portion
of Tenant's interest in this Lease or the Premises without Landlord's prior
written consent, which may be granted or withheld in Landlord's sole discretion.

               (b)  In the event that Landlord grants its consent to a Transfer
pursuant to this Section 9.1(a), after the effective date of such Transfer,
                 --------------
Tenant shall remain liable for all future obligations accruing under the Lease
and the Guarantors shall remain liable for all future obligations under the
Guaranty.

               (c)  Any corporate reorganization of Tenant, or any merger,
consolidation, take-over, buy-out or other change in the corporate structure or
effective voting control of Tenant shall be deemed a Transfer under this Section
                                                                         -------
9.1 and shall require Landlord's prior written consent which may be granted or
---
withheld in Landlord's sole discretion.  Notwithstanding the foregoing, Tenant
shall have the right to assign its interest in this Lease and the Premises to an
Affiliate provided that (i) the provisions of Section 9.2 are satisfied, (ii)
                                              -----------
the Affiliate expressly assumes all of Tenant's duties, liabilities and
obligations pursuant to this Lease, (iii) the Affiliate has no debt or other
liabilities except for those of Tenant existing prior to the Transfer and
assumed by such Affiliate pursuant to the Transfer and (iv) the Affiliate and
Tenant are under common control.  If the common stock of Tenant or of any
corporation which controls Tenant is or becomes the subject of a public
offering, such issuance of shares and/or subsequent trading of stock in Tenant
shall not be deemed a prohibited Transfer under this Section 9.1.  For purposes
                                                     -----------
of this Article 9, the terms "control" or "controls" shall mean possession,
        ---------
direct or indirect, of the power to direct or to cause the direction of, the
management and policies of any person or entity, through the ownership of not
less than ninety (90%) percent of voting securities, or partnership interest, or
by contract.

          Section 9.2.   In the event of any Transfer, whether or not Landlord's
consent is required, Landlord shall be given not less than thirty (30) days'
advance written notice of the proposed   effective date of such Transfer, which
notice shall be delivered to Landlord together with (i) either an executed
counterpart or, if unavailable, a true and complete copy of the proposed
instrument(s) of the Transfer and (ii) such other documents as Landlord may
reasonably request.

                                       29
<PAGE>

          Section 9.3.   Any consent by Landlord under this Article 9 shall
                                                            ---------
apply only to the specific transaction thereby authorized and shall not relieve
Tenant from the requirement of obtaining the prior written consent of Landlord
to any further Transfer of this Lease.  No Transfer of all or a portion of this
Lease shall release or relieve the original named Tenant (or any previously
approved transferee) from any obligations of the Tenant hereunder, and the
original named Tenant (or any previously approved transferee) shall remain
liable for the performance of all obligations of Tenant hereunder.

          Section 9.4.   Tenant shall not sublease all or any portion of the
Premises without obtaining Landlord's prior written consent which consent may be
granted or withheld in Landlord's sole discretion.  Tenant shall cause each
subtenant (a "Subtenant") permitted pursuant to this Article 9 to comply with
                                                     ---------
its obligations under its respective sublease (the "Sublease"), and Tenant shall
diligently enforce all of its rights as the landlord thereunder in accordance
with the terms of such Sublease and this Lease.

          Section 9.5.   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 take all necessary steps to prevent
any such violation or breach.

          Section 9.6.   If this Lease is assigned, or if the Premises or any
part thereof is subleased or occupied by anybody other than Tenant, Landlord
may, after Default by Tenant, collect Rent from the assignee or Subtenants, and
apply the net amount collected to the Rent herein reserved, but no such
assignment, sublease, occupancy or collection shall be deemed a waiver of this
covenant, or the acceptance of the assignee or Subtenant as tenant, or a release
of Tenant from the further performance by Tenant of the terms, covenants, and
conditions on the part of Tenant to be observed or performed hereunder. After
any assignment or subletting, Tenant's liability hereunder shall continue
notwithstanding any subsequent modification or amendment hereof or the release
of any subsequent tenant hereunder from any liability, to all of which Tenant
hereby consents in advance.  The consent by Landlord to any Transfer shall not
in any way be construed to relieve Tenant from obtaining the express written
consent of Landlord to any further Transfer.

          Section 9.7.   To secure the prompt and full payment by Tenant of the
Rent and the faithful performance by Tenant of all the other terms and
conditions herein contained on its part to be kept and performed, Tenant hereby
assigns, transfers and sets over unto Landlord, subject to the conditions
hereinafter set forth, all of Tenant's right, title and interest in and to all
Subleases and hereby confers upon Landlord, its agents and representatives, a
right of entry (subject to prior notice) in, and sufficient possession of, the
Premises to permit and insure the collection by Landlord of the rentals and
other sums payable under the Subleases, and further agrees that the exercise of
said right of entry and qualified possession by Landlord shall not constitute an
eviction of Tenant from the Premises or any portion thereof and that should said
right of entry and possession be denied Landlord, its agent or representative,
Landlord, in the exercise of said right, may use all requisite force to gain and
enjoy the same without

                                       30
<PAGE>

responsibility or liability to Tenant, its servants, employees, guests or
invitees, or any Person whomsoever; provided, however, that such assignment
                                    --------  -------
shall become operative and effective only if (a) an Event of a Default shall
occur, (b) this Lease and the Term shall be cancelled or terminated pursuant to
the terms, covenants and conditions hereof or (c) there occurs repossession
under a dispossess warrant or other re-entry or repossession by Landlord under
the provisions hereof or (d) a receiver for the Premises is appointed, and then
only as to such of the subleases that Landlord may elect to take over and
assume. At any time and from time to time within ten (10) days after Landlord's
written demand, Tenant promptly shall deliver to Landlord a schedule of all
subleases, setting forth the names of all Subtenants, with a photostatic copy of
each of the subleases. Upon reasonable request of Landlord, Tenant shall permit
Landlord and its agents and representatives to inspect all subleases affecting
the Premises. Tenant covenants that each sublease shall provide that the
Subtenant thereunder shall be required from time to time, upon request of
Landlord or Tenant, to execute, acknowledge and deliver, to and for the benefit
of Landlord, an estoppel certificate confirming with respect to such sublease
the information set forth in Section 14.1 hereof.
                             ------------

          Section 9.8.   Tenant covenants and agrees that all subleases
hereafter entered into affecting the Premises shall provide that (a) they are
subject to this Lease, (b) the term thereof should end not less than one (1) day
prior to the Expiration Date hereof, unless Landlord shall consent otherwise,
which consent may be withheld in Landlord's sole discretion, (c) the Subtenants
will not do, authorize or execute any act, deed or thing whatsoever or fail to
take any such action which will or may cause Tenant to be in violation of any of
its obligations under this Lease, (d) the Subtenants will not pay rent or other
sums under the subleases with Tenant for more than one (1) month in advance, (e)
the Subtenants shall give to Landlord at the address and otherwise in the manner
specified in Section 21.8 hereof, a copy of any notice of default by Tenant as
             ------------
the landlord under the subleases at the same time as, and whenever, any such
notice of default shall be given by the Subtenants to Tenant, and (f) in the
event of the termination or expiration of this Lease prior to the Expiration
Date hereof, any such Subtenant, at Landlord's election, shall be obligated to
attorn to and recognize Landlord as the lessor under such Sublease, in which
event such Sublease shall continue in full force and effect as a direct lease
between Landlord and the Subtenant upon all the terms and conditions of such
Sublease, except as hereinafter provided.  Any attornment required by Landlord
of such Subtenant shall be effective and self-operative as of the date of any
such termination or expiration of this Lease without the execution of any
further instrument; provided, however, that such Subtenant shall agree, upon the
                    ------------------
request of Landlord, to execute and deliver any such instruments in recordable
form and otherwise in form and substance satisfactory to Landlord to evidence
such attornment.  With respect to any attornment required by Landlord of any
Subtenant hereunder, (i) Landlord shall recognize all rights and obligations of
Tenant as the lessor under such Sublease, provided that such Sublease is for the
entire Premises and the rent provided for in such Sublease is equal to or
greater than the Rent required under this Lease, failing which Landlord shall
not be obligated to recognize all of the rights and obligations of Tenant as
lessor and the Subtenant thereunder shall be obligated to Landlord to perform
all of the obligations of the Subtenant under such sublease and (ii) Landlord
shall have no liability, prior to its becoming lessor under such Sublease, to
such

                                       31
<PAGE>

Subtenant nor shall the performance by such Subtenant of its obligations under
the sublease, whether prior to or after any such attornment, be subject to any
defense, counterclaim or setoff by reason of any default by Tenant in the
performance of any obligation to be performed by Tenant as lessor under such
sublease, nor shall Landlord be bound by any prepayment of more than one (1)
month's rent unless such prepayment shall have been expressly approved in
writing by Landlord. The provisions of this Section 9.8 shall survive the
                                            -----------
expiration or earlier termination of the Term.

          Section 9.9.   If Tenant assumes this Lease and proposes to assign the
same pursuant to the provisions of Title 11 of the United States Code or any
statute of similar purpose or nature (the "Bankruptcy Code") to any person or
entity who shall have made a bona fide offer to accept an assignment of this
Lease on terms acceptable to the Tenant, then notice of such proposed assignment
shall be given to Landlord by Tenant no later than twenty (20) days after
receipt of such offer by Tenant, but in any event no later than ten (10) days
prior to the date that Tenant shall file any application or motion with a court
of competent jurisdiction for authority and approval to enter into such
assumption and assignment.  Such notice shall set forth (a) the name and address
of the assignee, (b) all of the terms and conditions of such offer, and (c) the
proposal for providing adequate assurance of future performance by such person
under the Lease, including, without limitation, the assurance referred to in
Section 365 of the Bankruptcy Code.  Any person or entity to which this Lease is
assigned pursuant to the provisions of the Bankruptcy Code shall be deemed
without further act or deed to have assumed all of the obligations arising under
this Lease from and after the date of such assignment.  Any such assignee shall
execute and deliver to Landlord upon demand an instrument confirming such
assumption.

          Section 9.10.  The term "adequate assurance of future performance" as
used in this Lease shall mean (in addition to the assurances called for in
Bankruptcy Code Section 365(l)) that any proposed assignee, except for Guarantor
or any wholly owned subsidiary of Guarantor, shall, among other things, (a)
deposit with Landlord on the assumption of this Lease an amount equal to the
greater of (i) two (2) times the then monthly Fixed Rent and Additional Rent or
(ii) such other amount deemed by the Bankruptcy Court to be reasonably necessary
for the adequate protection of Landlord under the circumstances, as security for
the faithful performance and observance by such assignee of the terms and
obligations of this Lease, (b) furnish Landlord with financial statements of
such assignee for the prior three (3) fiscal years, as finally determined after
an audit and certified as correct by a certified public accountant, which
financial statements shall show a net worth at least equal to the amount of the
deposit referenced in (a) above, (c) if determined by the Bankruptcy Court to be
appropriate under the circumstances, grant to Landlord a security interest in
such property of the proposed assignee as Landlord shall deem necessary to
secure such assignee's future performance under this Lease, and (d) provide such
other information or take such action as Landlord, in its reasonable judgment,
shall determine is necessary to provide adequate assurance of the performance by
such assignee of its obligations under the Lease.

                                       32
<PAGE>

          Section 9.11.  If, at any time after Tenant may have assigned Tenant's
interest in this Lease, this Lease shall be disaffirmed or rejected in any
proceeding of the types described in Section 12.1(f) hereof, or in any similar
                                     ---------------
proceeding, or in the event of termination of this Lease by reason of any such
proceeding or by reason of lapse of time following notice of termination given
pursuant to Article 12 based upon any of the events of default set forth in said
            ----------
Section 12.1(f), Tenant, upon request of Landlord given within thirty (30) days
---------------
next following any such disaffirmance, rejection or termination (and actual
notice thereof to Landlord in the event of a disaffirmance or rejection or in
the event of termination other than by act of Landlord), shall (a) pay to
Landlord all Fixed Rent and Additional Rent due and owing by the assignee to
Landlord under this Lease to and including the date of such disaffirmance,
rejection or termination, and (b) as "tenant", enter into a new lease with
Landlord for a term commencing on the effective date of such disaffirmance,
rejection or termination and ending on the expiration date of the Term, unless
sooner terminated as in such lease provided, at the same Fixed Rent and
Additional Rent and upon the then executory terms, covenants and conditions as
are contained in this Lease, except that (i) Tenant's rights under the new lease
shall be subject to the possessory rights, if any, of the assignee under this
Lease and the possessory rights of any person claiming through or under such
assignee or by virtue of any statute or of any order of any court, (ii) such new
lease shall require all defaults existing under this Lease to be cured by Tenant
with due diligence, and (iii) such new lease shall require Tenant to pay all
Fixed Rent and Additional Rent reserved in this Lease which, had this Lease not
been so disaffirmed, rejected or terminated, would have accrued under the
provisions of this Lease after the date of such disaffirmance, rejection or
termination with respect to any period prior thereto.  If Tenant shall default
in its obligation to enter into said new lease for a period of ten (10) days
next following Landlord's request therefor, then in addition to all other rights
and remedies by reason of such default, either at law or in equity, Landlord
shall have the same rights and remedies against Tenant as if Tenant had entered
into such new lease and such new lease had thereafter been terminated as of the
commencement date thereof by reason of Tenant's default thereunder.

          Section 9.12.  The provisions of Sections 9.7, 9.8 and 9.9 hereof
                                           -------------------------
shall survive the expiration or earlier termination of this Lease.

          Section 9.13.  In no event shall Tenant mortgage, encumber, pledge,
hypothecate, grant a security interest in, collaterally assign or conditionally
transfer this Lease, the Hotel FF&E, the other Personal Property or removable
trade fixtures incorporated in or used in connection with the Premises or any
Subleases or any of the rents, issues and profits therefrom.

                                   ARTICLE 10

 LANDLORD'S RIGHT TO SELL, MORTGAGE, ASSIGN; SUBORDINATION AND NON-DISTURBANCE
 -----------------------------------------------------------------------------

          Section 10.1.  Landlord shall have the right at any time and from time
to time to place one or more Mortgages on all or any part of the Property (and
any increases, renewals,

                                       33
<PAGE>

modifications, consolidations, replacements and extensions thereof). It is
understood and agreed that wherever in this Lease Tenant may be required to make
policies of insurance payable to the holder of the Mortgage, such requirements
shall apply to the holder of any Mortgage of which Landlord has given Tenant
notice, but (as to insurance) only to the extent of Landlord's entitlement to
such proceeds under the provisions of this Lease. In no event shall Tenant be
required to pay any installment of principal or interest or other sums at any
time due under any Mortgage.

          Section 10.2.  Nothing contained in this Lease shall be deemed in any
way to limit, restrict or otherwise affect Landlord's absolute right at any time
or times to convey its interest in the Property, subject to this Lease, or to
assign its interest in this Lease, or to assign from time to time the whole or
any portion of Fixed Rent or Additional Rent at any time paid or payable
hereunder by Tenant to Landlord, to a transferee designated by Landlord in a
notice to Tenant, and in any such case Tenant shall pay Fixed Rent and
Additional Rent payable by Tenant to Landlord, or the portion thereof so
assigned, subject to the provisions of this Lease, to Landlord's designee at the
address mentioned in any such notice.

          Section 10.3.  This Lease shall be subject and subordinate to all
Mortgages now or hereinafter in effect and to all renewals, modifications,
consolidations, replacements and extensions of any such Mortgages; provided,
                                                                   --------
however, that, as a condition to Tenant's agreement to subordinate this Lease,
-------
the Mortgagee of such Mortgage shall execute and deliver to Tenant an agreement
to the effect that, if there shall be a foreclosure of its Mortgage, such
Mortgagee will not make Tenant a party defendant to such foreclosure, unless
necessary under applicable law for the Mortgagee to foreclose, or if there shall
be a foreclosure of such Mortgage, such Mortgagee shall not evict Tenant,
disturb Tenant's leasehold estate or rights hereunder, in all events provided
that no Event of Default then exists (any such agreement, or any agreement of
similar import, from a Mortgagee being hereinafter called a "Non-Disturbance
Agreement"), and Tenant shall attorn to the Mortgagee or any successor-in-
interest to Landlord or the Mortgagee.  This Section 10.3 shall be self-
                                             ------------
operative and no further instrument of subordination shall be required to make
the interest of any Mortgagee superior to the interest of Tenant hereunder.
Notwithstanding the previous sentence, however, Tenant shall, together with the
Mortgagee, execute and deliver promptly any certificate or agreement that
Landlord may reasonably request in confirmation of such subordination.  If, in
connection with the financing of the Premises, any lending institution or
Landlord shall request reasonable modifications of this Lease that do not
increase the monetary obligations of Tenant under this Lease or materially
increase the other obligations of Tenant under this Lease or materially and
adversely affect the rights of Tenant under this Lease, Tenant shall make such
modifications.  The standards (i.e., time and manner of giving such consent and
standard of reasonableness, if applicable) of a Mortgagee's consent with respect
to this Lease shall be materially consistent with those to which Landlord is
subject under this Lease.  Any Non-Disturbance Agreement may be made on the
condition that neither the Mortgagee nor anyone claiming by, through or under
such Mortgagee shall be:

               (a)  liable for any act or omission of any prior Landlord
(including, without

                                       34
<PAGE>

limitation, the then defaulting Landlord);

               (b)  subject to any defense or offsets which Tenant may have
against any prior Landlord (including, without limitation, the then defaulting
Landlord) which arise prior to the date such Mortgagee (or someone acquiring at
a foreclosure sale related to the Mortgagee's Mortgage) acquires title to the
Premises;

               (c)  bound by any payment of Rent which Tenant might have paid
for more than the current month to any prior Landlord (including, without
limitation, the then defaulting Landlord);

               (d)  bound by any obligation to make any payment to Tenant which
was required to be made prior to the time such Landlord succeeded to any prior
Landlord's interest, unless such payment is actually received by Mortgagee;

               (e)  bound by any obligation to perform any work or to make
improvements to the Premises;

               (f)  bound by any modification, amendment or supplement to this
Lease made without the prior written consent of the Mortgagee, which consent
shall not be unreasonably withheld or delayed; or

               (g)  bound by any security deposit for Tenant's obligations under
this Lease unless such deposit is actually received by Mortgagee.

     If required by any Mortgagee, Tenant promptly shall join in any Non-
Disturbance Agreement to indicate its concurrence with the provisions thereof
and its agreement, in the event of a foreclosure of any Mortgage to attorn to
such Mortgagee, as Tenant's landlord hereunder.  Tenant shall promptly so
accept, execute and deliver any Non-Disturbance Agreement proposed by any
Mortgagee which conforms with the provisions of this Section 10.3.  Any Non-
                                                     ------------
Disturbance Agreement may also contain other reasonable terms and conditions as
may otherwise be required by any Mortgagee which do not increase Tenant's
monetary obligations or materially and adversely affect the rights or
obligations of Tenant under this Lease.

          Section 10.4.  Tenant hereby agrees to give to any Mortgagee copies of
all notices given by Tenant of default by Landlord under this Lease at the same
time and in the same manner as, and whenever, Tenant shall give any such notice
of default to Landlord.  Such Mortgagee shall have the right to remedy any
default under this Lease, or to cause any default of Landlord under this Lease
to be remedied, and for such purpose Tenant hereby grants such Mortgagee such
period of time as may be reasonable to enable such Mortgagee to remedy, or cause
to be remedied, any such default in addition to the period given to Landlord for
remedying, or causing to be remedied, any such default which is a default.
Tenant shall accept performance by such Mortgagee of any term, covenant,
condition or agreement to be performed by Landlord under the Lease with the same
force and effect as though performed by Landlord.  No default by

                                       35
<PAGE>

Landlord under the Lease shall exist or shall be deemed to exist (i) as long as
such Mortgagee, in good faith, shall have commenced to cure such default and
shall be prosecuting the same to completion with reasonable diligence, subject
to force majeure, or (ii) if possession of the Premises is required in order to
cure such default, or if such default is not susceptible of being cured by such
Mortgagee, as long as such Mortgagee, in good faith, shall have notified Tenant
that such Mortgagee intends to institute proceedings under the Mortgage and,
thereafter, as long as such proceedings shall have been instituted and shall
prosecute the same with reasonable diligence and, after having obtained
possession, prosecutes the cure to completion with reasonable diligence. The
Lease shall not be assigned (subject to the provisions of Article 9) by Tenant
                                                          ---------
or modified, amended or terminated without such Mortgagee's prior written
consent in each instance, which consent shall not be unreasonably withheld or
delayed. In the event of the termination of the Lease by reason of any default
by Landlord hereunder or for any other reason whatsoever except the expiration
thereof, upon such Mortgagee's written request, given within thirty (30) days
after any such termination, Tenant, within fifteen (15) days after receipt of
such request, shall execute and deliver to such Mortgagee or its designee or
nominee a new lease of the Premises for the remainder of the Term of the Lease
upon all of the terms, covenants and conditions of this Lease. Neither such
Mortgagee nor its designee or nominee shall become liable under the Lease unless
and until such Mortgagee or its designee or nominee becomes, and then only for
so long as such Mortgagee or its designee or nominee remains, the fee owner of
the Premises. Such Mortgagee shall have the right, without Tenant's consent, to
foreclose the Mortgage or to accept a deed in lieu of foreclosure of such
Mortgage.

                                   ARTICLE 11

               OBLIGATIONS OF TENANT; INDEMNIFICATION OF LANDLORD
               --------------------------------------------------

          Section 11.1.  Tenant shall promptly comply with all laws, ordinances,
orders, rules, regulations, and requirements of all Federal, state, municipal or
other governmental or quasi-governmental authorities or bodies then having
jurisdiction over the Premises (or any part thereof) and/or the use and
occupation thereof by Tenant, whether any of the same relate to or require (i)
structural changes to or in and about the Premises, or (ii) changes or
requirements incident to or as the result of any use or occupation thereof or
otherwise (collectively, the "Requirements"), and subject to Article 7, Tenant
                                                             ---------
shall so perform and comply, whether or not such laws, ordinances, orders,
rules, regulations or requirements shall now exist or shall hereafter be enacted
or promulgated and whether or not the same may be said to be within the present
contemplation of the parties hereto.  The foregoing shall include, without
limitations, present and future compliance with the provisions of the Americans
with Disabilities Act.

          Section 11.2.  Tenant agrees to give Landlord notice of any law,
ordinance, rule, regulation or requirement enacted, passed, promulgated, made,
issued or adopted by any of the governmental departments or agencies or
authorities hereinbefore mentioned of which Tenant has notice affecting in a
material adverse manner (i) the Premises, (ii) Tenant's use thereof or (iii) the
financial condition of Tenant, a copy of which is served upon or received by
Tenant, or a

                                       36
<PAGE>

copy of which is posted on, or fastened or attached to the Premises, or
otherwise brought to the attention of Tenant, by mailing within five (5)
business days after such service, receipt, posting, fastening or attaching or
after the same otherwise comes to the attention of Tenant, a copy of each and
every one thereof to Landlord. At the same time, Tenant will inform Landlord as
to the Work which Tenant proposes to do or take in order to comply therewith.
Notwithstanding the foregoing, however, if such Work would require any
Alterations which would, in Landlord's opinion, reduce the value of the Premises
or change the general character, design or use of the Building or other
improvements thereon, and if Tenant does not desire to contest the same, Tenant
shall, if Landlord so requests, defer compliance therewith in order that
Landlord may, if Landlord wishes, contest or seek modification of or other
relief with respect to such Requirements, so long as Tenant is not put in
violation of any law, ordinance, rule, regulation or requirement enacted,
passed, promulgated, made, issued or adopted by any such governmental
departments or agencies or authorities, but nothing herein shall relieve Tenant
of the duty and obligation, at Tenant's expense, to comply with such
Requirements, or such Requirements as modified, whenever Landlord shall so
direct.

          Section 11.3.  (a)  Except in the case of the gross negligence or
willful misconduct of Landlord or its agents (but the following indemnity shall
specifically cover such party's simple, as opposed to gross, negligence), Tenant
shall defend, indemnify and save harmless Landlord, any beneficiaries of
Landlord, any officers, directors or shareholders of any beneficiaries of
Landlord and any officers, stockholders, directors or employees of any of the
foregoing (collectively, "Indemnified Parties"), from any and all liabilities,
claims, causes of actions, suits, damages and expenses (collectively, "Claims")
arising from or under the purchase, design, construction, preparation,
installation, inspection, delivery, non-delivery, acceptance, rejection,
ownership, management, possession, operation, rental, lease, sublease,
repossession, maintenance, alteration, addition, or substitution, storage,
transfer of title, redelivery, use, refinancing, disposition, operation,
condition, sale or transfer of all or any part or any interest in the Premises
or the imposition of any lien thereon (other than a Mortgage), in connection
with the Tenant's use of, or in connection with any other Tenant's activities of
any kind upon or affecting the Premises during the Term, including, without
limitation:

          (i)     Claims or penalties arising from any violation of any
                  Requirements or other law or in tort (strict liability or
                  otherwise), latent or other defects, whether or not
                  discoverable;

          (ii)    Claims based upon a violation or alleged violation of the
                  terms of any restriction, easement, condition or covenant or
                  other matter affecting title to the Premises;

          (iii)   The making of any modification to the Premises in violation of
                  standards imposed by any insurance policy required to be
                  maintained by Tenant pursuant to the Lease;

          (iv)    Claims arising from any public improvements with respect to
                  the Premises

                                       37
<PAGE>

            resulting in any change or special assessment being levied against
            the Premises or any plans to widen, modify or realign any street or
            highway adjacent to the Premises;

     (v)    Breach by Tenant of any covenant, representation or warranty made
            with respect to the Underlying Agreements;

     (vi)   Existence of any lien on or with respect to the Premises (other than
            a Mortgage), including liens which arise by reason of labor or
            materials furnished or claimed to have been furnished to Landlord,
            Tenant or any predecessor in title, or any of its contractors or
            agents; and

     (vii)  the failure to pay any Imposition before the imposition of any
            interest, fine or penalty.

               (b)  Tenant shall also indemnify and hold the Indemnified Parties
harmless from all costs, expenses and liabilities incurred, including actual,
customary and reasonable attorney's fees and disbursements through and including
appellate proceedings, in or in connection with any of such Claims.  If any
action or proceeding shall be brought against any of the Indemnified Parties by
reason of any such Claims, Tenant, upon notice from any of the Indemnified
Parties, shall resist and defend such action or proceeding, at its sole cost and
expense by counsel to be selected by Tenant but otherwise satisfactory to such
Indemnified Party in its reasonable discretion.  Tenant or its counsel shall
keep each Indemnified Party fully apprised at all times of the status of such
defense.  Notwithstanding the foregoing, an Indemnified Party may retain its own
attorneys to defend or assist in defending any claim, action or proceeding
involving potential liability in excess of Four Million Dollars ($4,000,000)
unless such claim, action, or proceeding is covered by insurance and the
insurance carrier has confirmed in writing both its obligation to defend such
claim, action or proceeding and its liability for any adverse judgment resulting
therefrom, and Tenant shall pay the actual, customary and reasonable fees and
disbursements of such attorneys.  The provisions of this Section 11.3 shall
                                                         ------------
survive the expiration or earlier termination of this Lease.

          Section 11.4.  If at any time prior to or during the Term (or within
the statutory period thereafter if attributable to Tenant), any mechanic's or
other lien or order for payment of money, which shall have been either created
by, caused (directly or indirectly) by, or suffered against Tenant, shall be
filed against the Premises or any part thereof, Tenant, at its sole cost and
expense, shall cause the same to be discharged by payment, bonding or otherwise,
within thirty (30) days after Tenant receives notice of the filing thereof
unless such lien or order is contested by Tenant in good faith and Tenant
provides sufficient security or evidence of financial ability, in each case to
the reasonable satisfaction of Landlord, to pay the amount of such lien or
order.  Tenant shall, upon notice and request in writing by Landlord, defend for
Landlord, at Tenant's sole cost and expense, any action or proceeding which may
be brought on or for the enforcement of any such lien or order for payment of
money, and will pay any damages and satisfy and discharge any judgment entered
in such action or proceeding and save harmless Landlord from

                                       38
<PAGE>

any liability, claim or damage resulting therefrom. In default of Tenant's
procuring the discharge of any such lien as aforesaid Landlord may, without
notice, and without prejudice to its other remedies hereunder, procure the
discharge thereof by bonding or payment or otherwise, and all cost and expense
which Landlord shall incur shall be paid by Tenant to Landlord as Additional
Rent forthwith.

          Section 11.5.  Landlord shall not under any circumstances be liable to
pay for any work, labor or services rendered or materials furnished to or for
the account of Tenant upon or in connection with the Premises, and no mechanic's
or other lien for such work, labor or services or material furnished shall,
under any circumstances, attach to or affect the reversionary interest of
Landlord in and to the Premises or any alterations, repairs, or improvements to
be erected or made thereon.  Nothing contained in this Lease shall be deemed or
construed in any way as constituting the request or consent of Landlord, either
express or implied, to any contractor, subcontractor, laborer or materialman for
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, nor as
giving Tenant any right, power or authority to contract for or permit the
rendering of any services or the furnishing of any materials on behalf of
Landlord that would give rise to the filing of any lien against the Premises.

          Section 11.6.  Neither Landlord nor its agents shall be liable for any
loss of or damage to the property of Tenant or others by reason of casualty,
theft or otherwise, or for any injury or damage to persons or property resulting
from any cause of whatsoever nature (nor shall such party be liable for any such
loss which is caused by or arises from the simple negligence of Landlord or its
agents), unless caused by or due to the gross negligence or willful misconduct
of Landlord, its agents, servants or employees.

          Section 11.7.  Landlord shall not be required to furnish to Tenant any
facilities or services of any kind whatsoever, including, but not limited to,
water, steam, heat, gas, oil, hot water, and/or electricity, all of which Tenant
represents and warrants that Tenant has obtained from the public utility
supplying the same, at Tenant's sole cost and expense.  Upon Tenant's written
request, however, Landlord agrees to cooperate with Tenant (at no cost to
Landlord) with respect to such services.

          Section 11.8.  Tenant shall promptly provide Landlord with a true and
complete copy of any complaint or pleading served upon Tenant by any Gaming
Authority which contains any prayer for relief involving the appointment of a
supervisor as to any aspect of Tenant's operation of the Premises or the
revocation of any gaming or liquor license held by Tenant.

                                       39
<PAGE>

                                   ARTICLE 12

                          DEFAULT BY TENANT; REMEDIES
                          ---------------------------

          Section 12.1.  Each of the following shall be deemed an event of
default (an "Event of Default") and a breach of this Lease by Tenant:

               (a)  If the Fixed Rent shall not be paid by Tenant for a period
of five (5) Business days after the same was due and payable.

               (b)  If Tenant shall fail to pay any Additional Rent required to
be paid by Tenant hereunder for a period of ten (10) business days after written
notice has been delivered by Landlord that the same was due and payable.

               (c)  If Tenant shall default in the performance or observance of
any of the other agreements, conditions, covenants or terms herein contained, or
if such default is of such a nature that it can be remedied, then if such
default shall continue for thirty (30) days after written notice by Landlord to
Tenant (or if such default is of such a nature that it cannot be completely
remedied within said thirty (30) day period, then if Tenant does not agree in
writing within such thirty (30) day period to cure the same, commence and
thereafter diligently prosecute the cure and complete the cure within a
reasonable period of time under the circumstances after such original written
notice of default by Landlord to Tenant).

               (d)  If there is any default under the Guaranty which remains
outstanding after any required notice and applicable cure period.

               (e)  If Tenant shall sell, assign, mortgage, encumber or transfer
all or any of its interest in this Lease or the Premises or any portion thereof
without compliance with the provisions of this Lease applicable thereto.

               (f)  If (i) Tenant or any Guarantor shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to Tenant, or any Guarantor or seeking to adjudicate Tenant or any
Guarantor a bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, liquidation, dissolution, composition or other relief with respect
to Tenant or any Guarantor or Tenant's debts or any Guarantor's debts, or (B)
seeking appointment of a receiver, trustee, custodian or other similar official
for Tenant or any Guarantor or for all or any substantial part of Tenant's
property; or (ii) Tenant or any Guarantor shall make a general assignment for
the benefit of Tenant's creditors or any Guarantor's creditors, as the case may
be; or (iii) there shall be commenced against Tenant or any Guarantor any case,
proceeding or other action of a nature referred to in clause (i) above or
seeking issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of Tenant's property or any
Guarantor's property, as the case may be, which case, proceeding or other action
(A) results in the entry of an

                                       40
<PAGE>

order for relief or (B) remains undismissed, undischarged or unbonded for a
period of sixty (60) days; or (iv) Tenant or any Guarantor shall take any action
consenting to or approving of any of the acts set forth in clause (i) or (ii)
above; or (v) Tenant or any Guarantor shall generally not, or shall be unable
to, pay Tenant's debts or any Guarantor's debts, as the case may be, as they
become due or shall admit in writing Tenant's or any Guarantor's inability to
pay Tenant's debts.

               (g)  If Tenant or any Guarantor is a corporation and shall cease
to exist as a corporation in good standing in the state of its incorporation
(unless Tenant or any Guarantor simultaneously becomes incorporated and in good
standing in another state) or if Tenant or any Guarantor is a partnership or
other entity and Tenant or any Guarantor shall be dissolved or otherwise
liquidated, then if Tenant does not completely remedy such default immediately
(or if Tenant's or any Guarantor's only knowledge of such default is by receipt
of written notice of such default, then within the ten (10) day period following
receipt of such written notice). Notwithstanding the foregoing, it shall not be
an Event of Default if Tenant converts from a corporation to another legal form
of ownership or merges with or into one or more of the Guarantors or with any
Affiliate as long as such conversion does not have an adverse affect on Tenant's
financial or legal capacity to discharge its obligations under this Lease.

               (h)  If Tenant fails or refuses to execute any subordination
agreement required pursuant to Article 10 or estoppel certificate required
                               ----------
pursuant to Article 14 within ten (10) Business days after Tenant's receipt
            ----------
thereof.

               (i)  If Tenant's liquor or gaming licenses are suspended or
revoked.

               (j)  If Tenant breaches any term, condition, covenant or
condition of the Ground Lease which (i) constitutes a monetary default under the
Ground Lease or (ii) results in a notice of a non-monetary default being served
on Landlord which is not cured to Landlord's satisfaction within fifteen (15)
days of the date of such notice or (iii) results in any other action by Ground
Lessor to terminate the Ground Lease.

               (k)  If Tenant shall default in the timely performance of any of
its covenants pursuant to Schedule 1.
                          ----------

                                       41
<PAGE>

          Section 12.2.

               (a)  If an Event of Default (i) described in Sections 12.1(c) or
                                                            ----------------
(e) hereof shall occur and be continuing and Landlord, at any time thereafter,
---
at its option, gives written notice to Tenant stating that this Lease or
(without terminating this Lease) Tenant's right to possess the Premises shall
terminate on the date specified in such notice, which date shall be not less
than three (3) business days after the giving of such notice, and if, on the
date specified in such notice, Tenant shall have failed to cure the default
which was the basis for the Event of Default, or (ii) described in Sections
                                                                   --------
12.1(a), (b), (f), (g) or (h) hereof shall occur and be continuing, then, upon
-----------------------------
notice by Landlord, all rights of Tenant under this Lease shall terminate or
(without terminating this Lease) Tenant's right to possess the Premises shall
terminate as specified in such notice (if such notice does not specify whether
this Lease or Tenant's right to possess the Premises shall terminate, then
Landlord shall be deemed to have elected to terminate Tenant's right to possess
the Premises without terminating this Lease) and Tenant immediately shall quit
and surrender the Premises, which termination shall not relieve Tenant from any
liability then or thereafter accruing hereunder. If Landlord elects to terminate
Tenant's right to possess the Premises, it may at any time thereafter elect to
terminate this Lease.

               (b)  If an Event of Default described in Sections 12.1(a) or (b)
                                                        -----------------------
hereof shall occur and be continuing, or this Lease or Tenant's right to possess
the Premises shall be terminated as provided in Section 12.2(a) hereof,
                                                ---------------
Landlord, upon five (5) days prior written notice, and following receipt of a
court order, (i) may re-enter and repossess the Premises using such force for
that purpose as may be necessary without being liable to indictment, prosecution
or damages therefor, or (ii) may dispossess Tenant by summary proceedings or
otherwise, which re-entry and repossession by Landlord shall not relieve Tenant
from any liability then or thereafter accruing hereunder, except that Tenant
shall be entitled to any credit for rent received from any reletting of the
Premises or the value of the Premises pursuant to Section 12.3(c) or (d).
                                                  ----------------------

          Section 12.3.  If this Lease or Tenant's right to possess the Premises
shall be terminated as provided in Section 12.2(a) hereof and/or Tenant shall be
dispossessed by summary proceedings or otherwise as provided in Section 12.2(b)
hereof:

               (a)  Tenant shall pay to Landlord all Rent payable under this
Lease by Tenant to Landlord to the date upon which this Lease or Tenant's right
to possess the Premises shall have been terminated or to the date of re-entry
upon the Premises by Landlord, as the case may be. Additionally, Tenant shall
pay to Landlord all costs incurred by Landlord (including court costs and
reasonable attorneys' fees and expenses) in (i) obtaining possession of the
Premises, (ii) removing and storing Tenant's or any other occupant's property,
(iii) repairing any damage to the Premises, and (iv) performing any of Tenant's
unperformed obligations.

               (b)  If Tenant's right to possess the Premises is terminated,
Landlord may repair and alter the Premises in such manner as Landlord may deem
necessary or advisable without relieving Tenant of any liability under this
Lease or otherwise affecting any such liability, and/or let or relet the
Premises or any parts thereof with one or more leases or subleases

                                       42
<PAGE>

for the whole or any part of the remainder of the Term or for a longer period,
in Landlord's name or as agent of Tenant, and out of any rent and other sums
collected or received as a result of such reletting Landlord shall: (i) first,
pay to itself the cost and expense of terminating this Lease, re-entering,
retaking, repossessing, repairing and/or re-letting the Premises, including the
amortized cost (taking into consideration the remaining term of the Lease and
the term of any subsequent lease) of altering the Premises, or any part thereof,
and the cost and expense of removing all persons and property therefrom,
including in such costs, market rate brokerage commissions, tenant improvement
expenses, actual and customary legal expenses and attorneys' fees and
disbursements, (ii) second, pay to itself the amortized (taking into
consideration the remaining term of the Lease and the term of any subsequent
lease) cost and expense sustained in securing any new tenants and other
occupants, including in such costs, market rate brokerage commissions, tenant
improvement expenses, actual, reasonable and customary legal expenses and
attorneys' fees and disbursements and other expenses of preparing the Premises
for reletting, and, if Landlord shall maintain and operate the Premises, the
cost and expense of operating and maintaining the Premises, and (iii) third, pay
to itself any balance remaining on account of the liability of Tenant to
Landlord. Landlord in no way shall be responsible or liable for any failure to
relet the Premises or any part thereof, or for any failure to collect any rent
due on any such reletting, and no such failure to relet or to collect rent shall
operate to relieve Tenant of any liability under this Lease or to otherwise
affect any such liability;

               (c)  If Tenant's right to possess the Premises is terminated,
Tenant shall be liable for and shall pay to Landlord, as damages, any deficiency
(referred to as "Deficiency"), between the Rent reserved in this Lease for the
period which otherwise would have constituted the unexpired portion of the Term
and the net amount, if any, of rents collected under any reletting effected
pursuant to the provisions of Section 12.3(b) hereof for any part of such
                              ---------------
period, first deducting from the rents collected under any such reletting all of
the payments to Landlord described in Section 12.3(b) hereof; any such
                                      ---------------
Deficiency shall be paid in installments by Tenant on the days specified in this
Lease for payment of installments of Rent, and Landlord shall be entitled to
recover from Tenant each Deficiency installment as the same shall arise, and no
suit to collect the amount of the Deficiency for any installment period shall
prejudice Landlord's right to collect the Deficiency for any subsequent
installment period by a similar proceeding; and

               (d)  If this Lease is terminated, Landlord shall be entitled to
recover from Tenant, and Tenant shall pay to Landlord, within ten (10) days
after written demand, as and for liquidated and agreed final damages (it being
agreed that it would be impracticable or extremely difficult to fix the actual
damage), a sum equal to the amount by which the Rent reserved in this Lease for
the period which otherwise would have constituted the unexpired portion of the
Term exceeds the actual rent due under any replacement lease of the Premises for
the same period, both discounted present worth at the rate of the then
applicable rate of interest on United States Treasury Securities having terms to
maturity most closely matching the unexpired portion of the Term.

          Section 12.4.  Subject to credits pursuant to Sections 12.3(c) and (d)
                                                        ------------------------
above, no

                                       43
<PAGE>

termination of this Lease pursuant to Section 12.2(a) hereof, and no taking
                                      ---------------
possession of and/or reletting the Premises, or any part thereof, pursuant to
Sections 12.2(b) and 12.3(b) hereof, shall relieve Tenant of its
         -------------------
liabilities and obligations hereunder, all of which shall survive such
expiration, termination, repossession or reletting.

          Section 12.5.  To the extent not prohibited by law, Tenant hereby
waives and releases all rights now or hereafter conferred by statute or
otherwise which would have the effect of limiting or modifying any of the
provisions of this Article 12.  Tenant shall execute, acknowledge and deliver
                   ----------
any instruments which Landlord may reasonably request, whether before or after
the occurrence of an Event of Default, evidencing such waiver or release.

          Section 12.6.  The Rent payable by Tenant hereunder and each and every
installment thereof, and all costs, actual, customary and reasonable attorneys'
fees and disbursements and other expenses which may be incurred by Landlord in
enforcing the provisions of this Lease on account of any delinquency of Tenant
in carrying out the provisions of this Lease shall be and they hereby are
declared to constitute a valid lien upon the interest of Tenant in this Lease
and in the Premises.

          Section 12.7.  Suit or suits for the recovery of damages, or for a sum
equal to any installment or installments of Rent payable hereunder or any
Deficiencies or other sums payable by Tenant to Landlord pursuant to this
Article 12, may be brought by Landlord from time to time at Landlord's election,
----------
and nothing herein contained shall be deemed to require Landlord to await the
date whereon this Lease or the Term would have expired by limitation had there
been no Event of Default by Tenant and termination.

          Section 12.8.  Nothing contained in this Article 12 shall limit or
                                                   -----------
prejudice the right of Landlord to prove and obtain as liquidated damages in any
bankruptcy, insolvency, receivership, reorganization or dissolution proceeding
an amount equal to the maximum allowed by a statute or rule of law governing
such proceeding and in effect at the time when such damages are to be proved,
whether or not such amount shall be greater than, equal to or less than the
amount of the damages referred to in any of the preceding Sections of this
Article 12.
----------

          Section 12.9.  Except as otherwise expressly provided herein or as
prohibited by applicable law, Tenant hereby expressly waives the service of any
notice of intention to re-enter provided for in any statute, or of the
institution of legal proceedings to that end, and Tenant, for and on behalf of
itself and all persons claiming through or under Tenant, also waives any and all
right of redemption provided by any law or statute now in force or hereafter
enacted or otherwise, or re-entry or repossession or to restore the operation of
this Lease in case Tenant shall be dispossessed by a judgment or by warrant of
any court or judge or in case of re-entry or repossession by Landlord or in case
of any expiration or termination of this Lease.

          Section 12.10. No failure by Landlord to insist upon the strict
performance of any covenant, 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

                                       44
<PAGE>

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 12.11. In the event of any breach by Tenant of any of the
covenants, agreements, terms or conditions contained in this Lease, Landlord
shall be entitled to seek a decree compelling performance of any of the
provisions hereof, and shall have the right to invoke any rights and remedies
allowed at law or in equity or by statute or otherwise as though re-entry,
summary proceedings, and other remedies were not provided for in this Lease.

          Section 12.12. 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.  Tenant
also shall pay to Landlord all reasonable costs and expenses, including, without
limitation, actual, customary and reasonable attorneys' fees and disbursements,
incurred by Landlord in enforcing any of the covenants and provisions of this
Lease and incurred in any action brought by Landlord against Tenant on account
of the provisions hereof, and all such costs, expenses and 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.  All of
the sums paid or obligations incurred by Landlord as aforesaid, with interest
and costs, shall be paid by Tenant to Landlord on demand.

          Section 12.13. If an Event of Default shall occur and be continuing
under this Lease, Landlord may (a) perform the same for the account of Tenant
and/or (b) make any expenditure or incur any obligation for the payment of money
in connection with any obligation owed to Landlord, including, but not limited
to, reasonable attorneys' fees and disbursements in instituting, prosecuting or
defending any action or proceeding, with interest thereon at the Default Rate
from the date of demand until paid and such amounts shall be deemed to be
Additional Rent hereunder and shall be paid by Tenant to Landlord within ten
(10) days after written demand therefor.  Default Rate shall have the meaning
ascribed to it in Article B of this Lease; provided, however, that for purposes
                  ---------                --------  -------
of this Article 12, such Default Rate shall never exceed the maximum non-
        ----------
usurious rate permitted by applicable law.

          Section 12.14. If Tenant shall fail to pay any installment of Fixed
Rent when due or any Additional Rent within ten (10) days after the date when
such payment is due, Tenant shall pay to Landlord, in addition to such
installment of Fixed Rent or such Additional Rent, as the case may be, interest
on the amount unpaid at the Default Rate, computed from the date such payment
was due to and including the date of payment.

                                       45
<PAGE>

                                   ARTICLE 13

                                   NO WAIVER
                                   ---------

          Section 13.1.  No receipt of moneys by Landlord from Tenant after the
termination or cancellation of this Lease or Tenant's right to possess the
Premises 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 Fixed Rent or Additional Rent then due, or thereafter
falling due, or operate as a waiver of the right of Landlord to recover
possession of the Premises by proper suit, action, proceeding or remedy; it
being agreed that, after the service of notice to terminate or cancel this Lease
or Tenant's right to possess the Premises, or the commencement of suit, action
or summary proceedings, or any other remedy, or after a final order or judgment
for the possession of the Premises, Landlord may demand, receive and collect any
moneys due, or thereafter falling due, without, in any manner whatsoever,
affecting such notice, proceeding, suit, action, order or judgment; and any and
all such moneys collected shall be deemed to be 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 13.2.  The failure of Landlord or Tenant to enforce any
agreement, condition, covenant or term, by reason of its breach by Tenant or
Landlord, as the case may be, shall not be deemed to void, waive or affect the
right of Landlord or Tenant to enforce the same agreement, condition, covenant
or term on the occasion of a subsequent default or breach.

          Section 13.3.  The specific remedies to which Landlord may resort
under the terms of this Lease are cumulative and are not intended to be
exclusive of any other remedies or means of redress to which Landlord may be
lawfully entitled in case of any breach or threatened breach by Tenant of any of
the terms, covenants and conditions of this Lease.  The failure of Landlord or
Tenant to insist in any one or more cases upon the strict performance of any of
the terms, covenants and conditions of this Lease, or to exercise any right or
remedy herein contained, shall not be construed as a waiver or relinquishment
for the future performance of such terms, covenants and conditions.  The receipt
by Landlord, or payment by Tenant, of Rent with knowledge of the breach of any
of such terms, covenants and conditions shall not be deemed a waiver of such
breach.  The acceptance of any check or payment bearing or accompanied by any
endorsement, legend or statements shall not, of itself, constitute any change in
or termination of this Lease.  No surrender of the Premises by Tenant (prior to
any termination of this Lease) shall be valid unless consented to in writing by
Landlord.  In addition to the other remedies in this Lease provided, Landlord or
Tenant shall be entitled to the restraint by injunction of the violation or
attempted or threatened violation of any of the terms, covenants and conditions
of this Lease or to a decree compelling performance of any of such terms,
covenants and conditions.

                                       46
<PAGE>

                                   ARTICLE 14

                             ESTOPPEL CERTIFICATES
                             ---------------------

          Section 14.1.  Tenant agrees that it shall, at any time and from time
to time upon not less than ten (10) Business days' prior notice by Landlord
execute, acknowledge and deliver to Landlord a statement in writing certifying
that this Lease is unmodified and in full force and effect (or if there have
been any modifications, that the Lease is in full force and effect as modified
and stating the modifications), the dates to which the Fixed Rent and Additional
Rent have been paid, and stating whether or not Landlord is in default in
keeping, observing or performing any term, covenant, agreement, provision,
condition or limitation contained in this Lease and, if in default, specifying
each such default, the Commencement Date and Expiration Date for the current
Term and any other matters reasonably requested by Landlord.  In addition,
Tenant shall, at any time and from time to time upon not less than ten (10)
Business days' prior notice by Landlord obtain and deliver to Landlord an
executed and acknowledged statement in writing certifying that the Lease
Guaranty is unmodified and in full force and effect (or if there have been any
modifications, that the Lease Guaranty is in full force and effect as modified
and stating such modifications).  Any such statement delivered pursuant to this
Article 14 may be relied upon by Landlord or any prospective purchaser of the
----------
Premises or any Mortgagee thereof or any assignee of any Mortgage upon the
Premises.

          Section 14.2.  Landlord agrees that it shall, at any time and from
time to time upon not less than ten (10) Business days' prior notice by Tenant
execute, acknowledge and deliver to Tenant a statement in writing certifying
that this Lease is unmodified and in full force and effect (or if there have
been any modifications, that the Lease is in full force and effect as modified
and stating the modifications), the dates to which the Fixed Rent and Additional
Rent have been paid, and stating whether or not Tenant is in default in keeping,
observing or performing any term, covenant, agreement, provision, condition or
limitation contained in this Lease and, if in default, specifying each such
default, the Commencement Date and Expiration Date for the current Term and any
other matters reasonably requested by Tenant; it being intended that any such
statement delivered pursuant to this Article 14 may be relied upon by Tenant or
                                     ----------
any permitted assignee of Tenant's interest in the Premises.

                                       47
<PAGE>

                                   ARTICLE 15

                                QUIET ENJOYMENT
                                ---------------

          Section 15.1.  Tenant, upon payment of the Rents herein reserved and
upon the due performance and observance of all the covenants, conditions and
agreements herein contained on Tenant's part to be performed and observed, shall
and may at all times during the Term peaceably and quietly have, hold and enjoy
the Premises without any manner of suit, trouble or hindrance of and from any
person claiming by, through or under Landlord, subject, nevertheless, to the
terms and provisions of this Lease.  No failure by Landlord to comply with the
foregoing covenant shall give Tenant any right to cancel or terminate this Lease
or to abate, reduce or make a deduction from or offset against the Fixed Rent or
any Additional Rent, or to fail to perform any other obligation of Tenant
hereunder.

                                   ARTICLE 16

                                   SURRENDER
                                   ---------

          Section 16.1.  Tenant shall, on the last day of the Term, or upon the
sooner termination of the Term, quit and surrender to Landlord the Premises
vacant, free of all equipment, furniture and other movable personal property of
Tenant, and in good order and condition, reasonable wear and tear excepted, and
Tenant shall remove or demolish all of the fixtures, structures and other
improvements which Landlord shall have elected to cause Tenant to remove
pursuant to and in accordance with Section 5.7 hereof.  Tenant's obligation to
                                   -----------
observe and perform this covenant shall survive the expiration or earlier
termination of the Term.  On the Expiration Date, Tenant shall reassign to
Landlord all of Tenant's right, title and interest in the Underlying Agreements.
On the Expiration Date, Tenant shall immediately surrender its gaming license to
the Gaming Authorities. Landlord acknowledges that, prior to operating any
gaming at the Premises, Landlord must obtain all necessary gaming licenses and
approvals from the Gaming Authorities.

          Section 16.2.  Upon the expiration of the Term, all Fixed Rent and
Additional Rent and other items payable by Tenant under this Lease shall be
apportioned to the date of termination.

          Section 16.3.  Tenant acknowledges that possession of the Premises
must be surrendered to Landlord at the expiration or sooner termination of the
term of this Lease. The parties recognize and agree that the damage to Landlord
resulting from any failure by Tenant to timely surrender possession of the
Premises as aforesaid will be extremely substantial, will exceed the amount of
the Fixed Rent and Additional Rent theretofore payable hereunder, and will be
impossible to accurately measure. Tenant therefore agrees that if possession of
the Premises is not surrendered to Landlord upon the expiration or sooner
termination of the term of this Lease, then Tenant shall pay to Landlord, as
liquidated damages for each month and for each

                                       48
<PAGE>

portion of any month during which Tenant holds over in the Premises after the
expiration or sooner termination of the term of this Lease, a sum equal to the
higher of (a) the then fair market rental value of the Premises, taking into
account the effect of all material factors reasonably relevant to such
determination, or (b) one and one-half (1 1/2) times the aggregate of the Fixed
Rent and Additional Rent which was payable under this Lease with respect to the
last month of the term hereof. Nothing herein contained shall be deemed to
permit Tenant to retain possession of the Premises after the expiration or
sooner termination of the term of this Lease. If Tenant holds over in possession
after the expiration or termination of the term of the Lease, such holding over
shall not be deemed to extend the term or renew this Lease, but the tenancy
thereafter shall continue as a tenancy from month to month upon the terms and
conditions of this Lease at the Fixed Rent and Additional Rent as herein
increased. Tenant hereby waives the benefit of any law or statute in effect in
the state where the Premises is located which would contravene or limit the
provisions set forth in this Section 16.3. This provision shall survive the
                             ------------
expiration or earlier termination of this Lease.

                                   ARTICLE 17

                                     ACCESS
                                     ------

          Section 17.1.  Landlord shall at all times during the Term have the
right and privilege to enter the Premises at reasonable times during business
hours, following reasonable notice from Landlord and so long as Landlord uses
its reasonable best efforts to not unduly interfere with Tenant's normal
business operations, for the purpose of inspecting the same or for the purpose
of showing the same to prospective purchasers or Mortgagees thereof, provided
however, such inspections shall be accompanied by a representative or employee
of Tenant.  Landlord shall also have the right and privilege at all times during
the Term to post notices of nonresponsibility for work performed by or on behalf
of Tenant and, during the last one (1) year of the Term, Landlord shall have the
right and privilege (i) to display the customary "For Sale" sign on the Building
and (ii) following reasonable notice from Landlord and so long as such entry
does not unduly interfere with Tenant's normal business operations, to enter the
Premises at reasonable times during business hours for the purpose of exhibiting
the same to prospective new tenants and to display the customary "To Let" signs
on any or all of the Building.

          Section 17.2.  Landlord shall at all times during the Term have the
right to enter the Premises or any part thereof, following reasonable notice
from Landlord and so long as Landlord uses its reasonable best efforts to not
unduly interfere with Tenant's or any Subtenant's normal business operations,
for the purpose of making such repairs or Alterations therein as Landlord deems
necessary or advisable following the failure of Tenant to make any such repairs
or Alterations beyond any applicable notice and cure period, but such right of
access shall not be construed as obligating Landlord to make any repairs to or
replacements to the Premises or as obligating Landlord to make any inspection or
examination of the Buildings.  Notwithstanding the foregoing, in the event of an
emergency, Landlord shall have the right to enter the Premises or any part
thereof without prior notice to Tenant.

                                       49
<PAGE>

          Section 17.3.  Anything in Sections 17.1 and 17.2 to the contrary
                                     ----------------------
notwithstanding, Landlord's access to those portions of the Premises containing
the counting rooms and security rooms of the casino shall be subject to the
limitations and requirements imposed by the Gaming Laws and the Gaming
Authorities.

                                   ARTICLE 18

                             ENVIRONMENTAL MATTERS
                             ---------------------

          Section 18.1.  Tenant represents and warrants to Landlord and each
Mortgagee that Tenant has conducted an appropriate inquiry and that, to the
current, actual knowledge of Tenant, no Hazardous Substance (as defined below)
has been used, generated, manufactured, produced, stored, released, discharged
or disposed of on, under, from or about the Premises and that, to the current,
actual knowledge of Tenant, no Hazardous Substance is located on or below the
Premises.  Except for Hazardous Substances customarily used for office products
and in compliance with all applicable laws, Tenant will not use, generate,
manufacture, produce, store, release, discharge or dispose of on, under, from or
about the Premises or transport to or from the Premises any Hazardous Substance
and will use its best efforts not to allow or suffer any other person or entity
to do so.

          Section 18.2.  Tenant shall keep and maintain the Premises in
compliance with, and shall use its best efforts not to cause, permit or suffer
the Premises to be in violation of any Environmental Law (as defined below).

          Section 18.3.  Tenant represents and warrants to Landlord and any
Mortgagee that Tenant has not received any notice of a violation of any
Environmental Law, nor incurred any previous liability therefor with respect to
the Premises.  Tenant shall give prompt written notice to Landlord of:

          (i)     becoming actually aware of any use, generation, manufacture,
     production, storage, release, discharge or disposal of any Hazardous
     Substance on, under, from or about the Premises or the migration thereof to
     or from other property;

          (ii)    becoming actually aware of the commencement, institution or
     threat of any proceeding, inquiry or action by or notice from any local,
     state or federal governmental authority with respect to the use or presence
     of any Hazardous Substance on the Premises or the migration thereof from or
     to other property;

          (iii)   becoming actually aware of all claims made or threatened by
     any third party against Tenant or the Premises relating to any damage,
     contribution, cost recovery, compensation, loss or injury resulting from
     any Hazardous Substance;

                                       50
<PAGE>

          (iv)    Tenant's actual discovery of any occurrence or condition on
     any real property adjoining or in the vicinity of the Premises that could
     cause the Premises or any part thereof to be subject to any restrictions on
     the ownership, occupancy, transferability or use of the Premises under any
     Environmental Law, or any regu lation adopted in accordance therewith, or
     to be otherwise subject to any restrictions on the ownership, occupancy,
     transferability or use of the Premises under any Environmental Law; and

          (v)     obtaining actual knowledge of any incurrence of expense by any
     governmental authority or others in connection with the assessment,
     containment or removal of any Hazardous Substance located on, under, from
     or about the Premises or any property adjoining or in the vicinity of the
     Premises.

          Section 18.4.  Landlord shall have the right, but not the obligation,
to join and participate in, as a party if it so elects, any legal proceedings or
actions initiated with respect to the Premises in connection with any
Environmental Law and have its actual, customary and reasonable attorneys' fees
in connection therewith paid by Tenant or be defended by Tenant from and against
any such proceedings or actions with counsel chosen by Landlord (provided that
Landlord and Tenant shall attempt, in good faith, to agree on one counsel to
represent both Landlord and Tenant, if in Landlord's good faith determination
such joint representation is feasible or appropriate under the circumstances),
and shall have the right to make inquiry of and disclose all information to
appropriate governmental authorities when advised by counsel that such
disclosure may be required under applicable law.

          Section 18.5.  Without Landlord's prior written consent, which consent
shall not be unreasonably withheld or delayed, Tenant shall not take any
remedial action, other than pursuant to the plan developed in accordance with
Section 18.8, in response to the presence of any Hazardous Substance on, under,
------------
from or about the Premises, nor enter into any settlement, consent or compromise
which might, in Landlord's reasonable judgment, impair the value of Landlord's
interest in the Premises under this Lease; provided, however, that Landlord's
                                           --------  -------
prior consent shall not be necessary if the presence of Hazardous Substance on,
under, from or about the Premises either poses an immediate threat to the
health, safety or welfare of any individual or is of such a nature that an
immediate remedial response is necessary and it is not practical or possible to
obtain Landlord's consent before taking such action.  In such event Tenant shall
notify Landlord as soon as practicable of any action so taken.  Landlord agrees
not to withhold its consent, where such consent is required hereunder, if either
(i) a particular remedial action is ordered by a court or any agency of
competent jurisdiction, or (ii) Tenant establishes to the reasonable
satisfaction of Landlord that there is no reasonable alternative to such
remedial action which would result in less impairment of Landlord's security
hereunder.

          Section 18.6.  Tenant shall protect, indemnify and hold harmless
Landlord and each Mortgagee, their respective directors, officers, partners
employees, agents, successors and assigns from and against any and all claim,
loss, damage, cost, expense, liability, fines, penalties, charges,
administrative and judicial proceedings and orders, judgments, remedial action
requirements, enforcement actions of any kind (including, without limitation,
attorneys' fees and

                                       51
<PAGE>

costs) directly or indirectly arising out of or attributable to, in whole or in
part, the breach of any of the covenants, representations and warranties of this
Article 18 or the use, generation, manufacture, production, storage, release,
----------
threatened release, discharge, disposal, or presence of a Hazardous Substance
on, under, from or about the Premises, or any other activity carried on or
undertaken on or off the Premises, whether prior to or during the Term and
whether by Tenant or any predecessor in title or any employees, agents,
contractors or subcontractors of Tenant or any predecessor in title, or any
third persons at any time occupying or present on the Premises, in connection
with the handling, treatment, removal, storage, decontamination, clean-up,
transport or disposal of any Hazardous Substance at any time located or present
on, under, from or about the Premises, including, without limitation: (i) all
consequential damages; (ii) the costs of any required or necessary environmental
assessments and/or audits, any repair, cleanup or detoxification of the Premises
and the preparation and implementation of any closure, remedial or other
required plans including, without limita tion: (A) the costs of removal or
remedial action incurred by the United States Government or the state in which
the Premises are located, or response costs incurred by any other person, or
damages from injury to, destruction of, or loss of natural resources, including
the costs of assessing such injury, destruction or loss, incurred pursuant any
Environmental Law; (B) the clean-up costs, fines, damages or penalties incurred
pursuant to the provisions of applicable state law; and (C) the cost and
expenses of abatement, correction or clean-up, fines, damages, response costs or
penalties which arise from the provisions of any other statute, state or
federal; and (iii) liability for personal injury or property damage, including
damages assessed for the maintenance of the public or private nuisance, response
costs or for the carrying on of an abnormally dangerous activity.

          The foregoing indemnity shall further apply to any residual
contamination on, under, from or about the Premises, or affecting any natural
resources arising in connection with the use, generation, manufacturing,
production, handling, storage, transport, discharge or disposal of any such
Hazardous Substance, and irrespective of whether any of such activities were or
will be undertaken in accordance with Environmental Law or other applicable
laws, regulations, codes and ordinances.  This indemnity is intended to be
operable under 42 U.S.C. Section 9607(e)(1), and any successor section thereof
and shall survive expiration or earlier termination of this Lease and any
transfer of all or a portion of the Premises by Tenant.

          The foregoing indemnity shall in no manner be construed to limit or
adversely affect Landlord's rights under this Article 18, including, without
                                              ----------
limitation, Landlord's rights to approve any Remedial Work (as defined below) or
the contractors and consulting engineers retained in connection therewith.

          The foregoing indemnity shall not apply to any contamination of the
Premises caused by the gross negligence or willful misconduct of Landlord or its
agents or employees (but such indemnity shall specifically cover such party's
simple negligence).

          Section 18.7.  In the event that any investigation, site monitoring,
containment, cleanup, removal, restoration or other remedial work of any kind or
nature (the "Remedial Work") is required by any applicable local, state or
federal law or regulation, any judicial order,

                                       52
<PAGE>

or by any governmental entity or person because of, or in connection with, the
current or future presence, suspected presence, release or suspected release of
a Hazardous Substance in or into the air, soil, groundwater, surface water or
soil vapor at, on, about, under or within the Premises (or any portion thereof),
Tenant shall within thirty (30) days after written demand for performance
thereof by Landlord (or such shorter period of time as may be required under any
applicable law, regulation, order or agreement), commence to perform, or cause
to be commenced, and thereafter diligently prosecute to completion within such
period of time as may be required under any applicable law, regulation, order or
agreement, all such Remedial Work at Tenant's sole expense in accordance with
the requirements of any applicable governmental authority or Environmental Law.
All Remedial Work shall be performed by one or more contractors, approved in
advance in writing by Landlord, which approval shall not be unreasonably
withheld, and under the supervision of a consulting engineer approved in advance
in writing by Landlord. All costs and expenses of such Remedial Work shall be
paid by Tenant, including, without limitation, the charges of such contractor(s)
and/or the consulting engineer, and Landlord's actual, customary and reasonable
attorneys' fees and costs incurred in connection with monitoring or review of
such Remedial Work. In the event Tenant shall fail to timely commence, or cause
to be commenced, or fail to complete the Remedial Work within the time required
above, Landlord may, but shall not be required to, cause such Remedial Work to
be performed and all costs and expenses thereof, or incurred in connection
therewith shall become part of the indebtedness secured hereby.

          Section 18.8.  Landlord shall have the right, no more than once every
other year, to engage or cause Tenant to engage, each at Tenant's sole cost and
expense, an environmental consultant acceptable to both Landlord and Tenant, to
review compliance by Tenant with all applicable laws and standards existing at
such time with respect to the practice relating to contamination or hazardous
waste methods, conditions and procedures and Tenant's development of a plan to
identify, contain and remediate problems caused by such Hazardous Substances.
The foregoing sentence shall not be deemed to require an environmental
compliance audit, unless otherwise reasonably recommended pursuant to such
review.  In the event that Landlord reasonably believes that there may be a
violation or threatened violation by Tenant of any Environmental Law or a
violation or threatened violation by Tenant of any covenant under this Article
                                                                       -------
18, Landlord is authorized, but not obligated, by itself, its agents, employees
--
or workers to enter at any reasonable time following reasonable notice, so long
as Landlord uses its reasonable best efforts to not unduly interfere with
Tenant's normal conduct of business, upon any part of the Premises for the
purposes of inspecting the same for Hazardous Substances and Tenant's compliance
with this Article 18, and such inspections may include, without limitation, soil
          ----------
borings. Tenant agrees to pay to Landlord, within ten (10) days after Landlord's
written demand, all actual, customary and reasonable expenses, costs or other
amounts incurred by Landlord to unaffiliated third parties in performing any
inspection for the purposes set forth in this Section 18.8.
                                              ------------

          Section 18.9.  All costs and expenses incurred by Landlord under this
Article 18 shall be immediately due and payable as Additional Rent within ten
----------
(10) days after written

                                       53
<PAGE>

demand and shall bear interest at the Default Rate from the date of notice of
such payment by Landlord and the expiration of any grace period provided herein
until repaid.

          Section 18.10. "Environmental Laws" shall mean any federal, state or
local law, statute, ordinance or regulation pertaining to health, industrial
hygiene, hazard  ous waste or the environmental conditions on, under, from or
about the Premises, including, without limitation, the laws listed in the
definition of Hazardous Substances below.

          Section 18.11. "Hazardous Substances" shall mean any element,
compound, chemical mixture, contaminant, pollutant, material, waste or other
substance which is defined, determined or identified as a "hazardous substance",
"hazardous waste" or "hazardous material" under any federal, state or local
statute, regulation or ordinance applicable to a Real Property, as well as any
amendments and successors to such statutes and regulations, as may be enacted
and promulgated from time to time, including, without limitation, the following:
(i) the Comprehensive Environmental Response, Compensation and Liability Act of
1980 (codified in scattered sections of 26 U.S.C., 33 U.S.C., 42 U.S.C.(S) and
42 U.S.C. (S) 9601 et seq.); (ii) the Resource Conservation and Recovery Act of
                   -- ----
1976 (42 U.S.C. (S) 6901 et seq.); (iii) the Hazardous Materials Transportation
                         -- ----
Act (49 U.S.C. (S) 1801 et seq.); (vi) the Toxic Substances Control Act (15
                        -- ----
U.S.C. (S) 2601 et seq.); (v) the Clean Air Act (33 U.S.C. (S) 1251 et seq.);
                -- ----                                             -- ----
(vi) the Clean Air Act (42 U.S.C. (S) 7401 et seq.); (vii) the Safe Drinking
                                           -- ----
Water Act (21 U.S.C. (S) 349; 42 U.S.C. (S) 201 and (S) 300f et seq.); (viii)
                                                             -- ----
the National Environmental Policy Act of 1969 (42 U.S.C. (S) 3421); (ix) the
Superfund Amendment and Reauthorization Act of 1986 (codified in scattered
sections of 10 U.S.C., 29 U.S.C., 33 U.S.C. and 42 U.S.C.); (x) Title III of the
Superfund Amendment and Reauthorization Act (40 U.S.C. (S) 1101 et seq.); (xi)
                                                                -- ----
Nevada Revised Statutes ("NRS") Sections 41.540 through 41.570; (xii) NRS
Chapter 445A; and (xiii) NRS Chapter 459.

          Section 18.12. All representations and warranties contained in this
Article 18 shall supersede any previous disclosures, written or oral, made by
----------
Tenant or its agents to Landlord with respect to the Premises.  Landlord and any
Mortgagee shall be entitled to rely on the representations and warranties
contained herein in pursuit of its rights and remedies for a breach thereof
without regard to any such previous disclosures.

          Section 18.13. All representations, warranties, covenants and
indemnities of Tenant in this Article 18 shall continue to be binding upon
                              ----------
Tenant, and its successors and assigns, after the expiration or earlier
termination of this Lease.

                                   ARTICLE 19

                              FINANCIAL STATEMENTS
                              --------------------

     Tenant shall furnish to Landlord, as soon as available and in any event
within ninety (90) days after the end of its fiscal year, an audited balance
sheet of Tenant as at the close of such

                                       54
<PAGE>

year, together with the related statements of profit and loss and changes in
financial position for such period, setting forth in each case, in comparative
form, the corresponding figures for the preceding fiscal year, prepared by an
independent certified public accounting firm of recognized standing. In
addition, within forty five (45) days after the end of each of the first three
(3) quarters of each of its respective fiscal years, the Tenant shall furnish an
unaudited balance sheet as at the close of such quarter, together with the
related unaudited statement of profit and loss and changes in financial position
together with a certificate stating that Tenant is in compliance with all of the
financial covenants set forth in Article 4 and including a worksheet calculating
                                 ---------
the ratios applicable thereto, all certified by the chief financial officer, or
a treasurer or comptroller of the Tenant. All financial statements furnished by
Tenant to Landlord hereunder shall be prepared in accordance with generally
accepted accounting principles consistently applied. Landlord shall keep such
statements confidential, subject to its right to disclose such statements to
existing or prospective Mortgagees and purchasers and to any governmental
authority, including the Securities and Exchange Commission. To the extent that
Tenant remains a subsidiary of one or more of the Guarantors, the delivery to
Landlord of the audited annual financial statements, consolidating the
subsidiaries of such Guarantor as at the close of its fiscal year prepared by an
independent certified public accounting firm shall be deemed to satisfy the
requirement that Tenant deliver an annual audit financial statement.

                                   ARTICLE 20

                            LIMITATION OF LIABILITY
                            -----------------------

          Section 20.1.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
THIS LEASE, THE LIABILITY OF LANDLORD (AND OF ANY SUCCESSOR LANDLORD HEREUNDER)
TO TENANT SHALL BE LIMITED TO THE INTEREST OF LANDLORD IN THE PREMISES, AND
TENANT AGREES TO LOOK SOLELY TO LANDLORD'S INTEREST IN THE PREMISES AND THE
RENTS RESERVED UNDER THIS LEASE FOR THE RECOVERY OF ANY JUDGMENT OR AWARD
AGAINST THE LANDLORD, IT BEING INTENDED THAT LANDLORD SHALL NOT BE PERSONALLY
LIABLE FOR ANY JUDGMENT OR DEFICIENCY.

                                   ARTICLE 21

                            MISCELLANEOUS PROVISIONS
                            ------------------------

          Section 21.1.  It is mutually agreed by and between Landlord and
Tenant that the respective parties shall and they hereby do waive trial by jury
in any action, proceeding or counterclaim brought by either of the parties
hereto against the other on any matters whatsoever arising out of or in any way
connected with this Lease, Tenant's use or occupancy of the Premises, and/or any
claim of injury or damage excluding any claim for personal injury or property
damage.

                                       55
<PAGE>

          Section 21.2.  Any sign shall be lawful under applicable sign codes
and subdivision covenants and other Requirements.

          Section 21.3.  (a)  The term "Landlord" as used herein shall mean only
the owner or the mortgagee in possession for the time being of the Premises, so
that in the event of any sale, transfer or conveyance of the Premises Landlord
shall be and hereby is entirely freed and relieved of all agreements, covenants
and obligations of Landlord thereafter accruing hereunder (but not freed from
obligations arising prior to such conveyance while such party owned or was in
possession of the Premises), and it shall be deemed and construed without
further agreement between the parties or their successors in interest or between
the parties and the purchaser, transferee or grantee at any such sale, transfer
or conveyance that such purchaser, transferee or grantee has assumed and agreed
to carry out any and all agreements, covenants and obligations of Landlord
hereunder.

                  (b) The term "Tenant" as used herein shall mean the tenant
named herein, and from and after any valid assignment or transfer in whole of
said Tenant's interest under this Lease pursuant to the provisions of Article 9,
shall mean only the assignee or transferee thereof; but the foregoing shall not
release the assignor or transferor from liability under this Lease.

                  (c) The words "enter", "re-enter", "entry" and "re-entry" as
used in this Lease shall not be restricted to their technical legal meaning.

                  (d) 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 the words "successor and assigns" or "successors or
assigns" of Landlord or Tenant shall be deemed to include the heirs, executors,
administrators, representatives and assigns of any individual Landlord or
Tenant.

          Section 21.4.  The headings herein are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope
or intent of this Lease nor in any way affect this Lease.

          Section 21.5.  This Lease shall be governed by and construed in
accordance with the laws of the state in which the Premises are located without
resort to conflict of laws principles.

          Section 21.6.  This Lease and the Exchange Agreement contain the
entire agreement between the parties and may not be extended, renewed,
terminated or otherwise modified in any manner except by an instrument in
writing executed by the party against whom enforcement of any such modification
is sought.  Except for the terms and provisions of the Exchange Agreement, all
prior understandings and agreements between the parties and all prior working
drafts of this Lease are merged in this Lease, which alone expresses the
agreement of the parties.  The parties agree that no inferences shall be drawn
from matters deleted from any working drafts of this Lease.

                                       56
<PAGE>

          Section 21.7.  The agreements, terms, covenants and conditions herein
shall bind and inure to the benefit of Landlord and Tenant and their respective
heirs, personal representatives, successors and, except as is otherwise provided
herein, their assigns.

          Section 21.8.  Notice whenever provided for herein shall be in writing
and shall be given either by personal delivery, overnight express mail or by
certified or registered mail, return receipt requested, to Landlord at the
address hereinabove set forth, with a copy of any notice of default from, or
claim by, Tenant to Paul, Hastings, Janofsky & Walker LLP, Park Avenue Tower, 75
East 55th Street, New York, New York 10022, Attention: Kevin J. O'Shea, Esq.;
and to Tenant at the address hereinabove set forth, or to such other persons or
at such other addresses as may be designated from time to time by written notice
from either party to the other.  Notices shall be deemed given (i) when
delivered personally if delivered on a business day (or if the same is not a
Business day, then the next Business day after delivery), (ii) three (3)
Business days after being sent by United States mail, registered or certified
mail, postage prepaid, return receipt requested or (iii) if delivery is made by
Federal Express or a similar, nationally recognized overnight courier service
for 9:00 a.m. delivery, then on the date of delivery (or if the same is not a
Business day, then the next Business day after delivery), if properly sent and
addressed in accordance with the terms of this Section 21.8.
                                               ------------

          Section 21.9.  If any provision of this Lease shall be invalid or
unenforceable, the remainder of the provisions of this Lease shall not be
affected thereby and each and every provision of this Lease shall be enforceable
to the fullest extent permitted by law.

          Section 21.10. Landlord and Tenant each represent and warrant to the
other party that such party has not dealt with any real estate broker in
connection with this Lease, and Landlord and Tenant agree to indemnify the other
party and save the other party harmless from any and all claims for brokerage
commissions by any other person, firm, corporation or other entity claiming
through such party to have brought about this Lease transaction.  The provisions
of this Section 21.10 shall survive the expiration or earlier termination of
        -------------
this Lease.

          Section 21.11. Tenant is and shall be in exclusive control and
possession of the Premises, and Landlord shall not, in any event whatsoever, be
liable for any injury or damage to any property or to any person happening in,
on or about the Premises, nor for any injury or damage to any property of
Tenant, or of any other person or persons contained therein unless the same is
caused by Landlord's negligent acts or omissions.  The provisions hereof,
including without limitation Article 17, permitting Landlord to enter and
                             ----------
inspect the Premises are made for the purpose of enabling Landlord to be
informed as to whether Tenant is complying with the agreements, terms, covenants
and conditions hereof, and if Landlord so desires, to do such acts as Tenant
shall fail to do.

          Section 21.12. A memorandum of this Lease as set forth on Exhibit "D"
                                                                    -----------
attached hereto and incorporated herein by this reference shall be recorded.
The memorandum of lease shall incorporate the basic terms and conditions hereof
but shall delete any statement or mention of the rental payments.

                                       57
<PAGE>

          Section 21.13. The parties took equal part in drafting this Lease and
no rule of construction that would cause any of the terms hereof to be construed
against the drafter shall be applicable to the interpretation of this Lease.

          Section 21.14. TIME IS STRICTLY OF THE ESSENCE WITH RESPECT TO EACH
AND EVERY TERM AND PROVISION OF THIS LEASE, INCLUDING, WITHOUT LIMITATION, THE
RIGHTS OF TENANT PURSUANT TO ARTICLES 23, 24, 25 AND 26.
                             --------------------------

          Section 21.15. The time within which either party hereto shall be
required to perform any act under this Lease, other than the payment of money,
shall be extended by a period of time equal to the number of days during which
performance of such act is delayed by strikes, lockouts, acts of God,
governmental restrictions, failure or inability to secure materials or labor by
reason of priority or similar regulation or order of any governmental or
regulatory body, enemy action, civil disturbance, fire, unavoidable causalities
or any other cause beyond the reasonable control of either party hereto.

          Section 21.16. The parties agree that this Lease constitutes a true
lease for Federal and state income tax purposes and agree to file their
respective income tax returns accordingly.

                                   ARTICLE 22

                            FAIR MARKET RENTAL VALUE
                            ------------------------

          Section 22.1.  For purposes of determining the fair market rental
value during any renewal term ("Renewal Fair Market Rental Value"), the
following procedure shall apply:

               (a) If Tenant has timely delivered a renewal notice, Landlord
shall within 15 days deliver to Tenant a written notice of Landlord's
determination of what the Renewal Fair Market Rental Value would be during such
renewal term (the "Renewal Rent Notice").

               (b) Within thirty (30) days after Tenant's receipt of the Renewal
Rent Notice, Tenant shall give Landlord a notice ("Tenant's Renewal Response
Notice") electing either (i) to accept the Renewal Fair Market Rental Value set
forth in the Renewal Rent Notice, in which case the Renewal Fair Market Rental
Value shall be as set forth in the Renewal Rent Notice, or (ii) not to accept
Landlord's determination of the Renewal Fair Market Rental Value set forth in
the Renewal Rent Notice in which case Tenant's Renewal Response Notice shall
include Tenant's determination of what the Renewal Fair Market Rental Value
would be during such renewal term, whereupon Landlord and Tenant shall endeavor
to agree upon the Renewal Fair Market Rental Value on or before the date that is
thirty (30) days after Landlord's receipt of Tenant's Renewal Response Notice.
If Landlord and Tenant are unable to agree upon the Renewal Fair Market Rental
Value within such 30-day period, then the Renewal Fair Market Rental Value shall
be determined in accordance with Section 22.2. If Tenant fails to deliver
                                 ------------

                                       58
<PAGE>

Tenant's Renewal Response Notice within the 30-day period following its receipt
of Landlord's Renewal Rent Notice, Tenant shall be conclusively deemed to have
accepted Landlord's determination of the Renewal Fair Market Rental Value.

          Section 22.2.  If Landlord and Tenant shall fail to agree upon the
Renewal Fair Market Rental Value within 30 days of the date of Landlord's
receipt of Tenant's Renewal Response Notice, then, within ten (10) Business days
thereafter, Landlord and Tenant each shall give notice to the other setting
forth the name and address of an independent real estate appraiser or consultant
having at least 10 years' experience in the business of appraising or
determining the value of hotel and casino properties in Nevada and having the
professional qualification of MAI, SREA or CRE. If either party shall fail to
give notice of such designation within such ten (10) Business day period, then
the appraiser chosen shall make the determination alone. If two appraisers have
been designated, such two appraisers may consult with each other and shall, not
later than the 60th day after Landlord's receipt of Tenant's Renewal Response
Notice choose either Landlord's or Tenant's determination of the Renewal Fair
Market Rental Value by simultaneously giving written notice thereof to each of
Landlord and Tenant, in which case the determination so chosen shall be final
and binding upon Landlord and Tenant. If such two appraisers shall fail to
concur within such thirty (30) day period, then such two appraisers shall,
within the next ten (10) days, designate a third appraiser meeting the above
requirements. The third appraiser shall within thirty (30) days after its
designation, choose either Landlord's or Tenant's determination (and no other)
by simultaneously delivering to Landlord and Tenant signed and acknowledged
original counterparts of his or her determination within seven (7) days thereof.

          Section 22.3.  The costs and expenses of each party's appraiser shall
be paid by such party. The costs and expenses of the third appraiser shall be
shared equally by Landlord and Tenant.

          Section 22.4.  If the Renewal Fair Market Rental Value shall not have
been determined prior to the commencement of each renewal term, then until the
Renewal Fair Market Rental Value shall have been finally determined in respect
of such renewal term, such renewal term rent shall be equal to the Fixed Rent
payable by Tenant for the Premises during the Lease year immediately preceding
the commencement of such renewal term. Promptly after such final determination,
an appropriate retroactive adjustment shall be made reconciling the amount of
Fixed Rent determined to have been payable by Tenant from and after the
commencement of such renewal term and the amount Tenant actually paid Landlord
as Fixed Rent prior to such final determination, and the party owing the other
party pursuant to such reconciliation shall promptly make payment therefor with
interest thereon at the then current base rate publicly announced by Citibank,
N.A., or its successor, in New York, New York from the date Tenant actually paid
such Fixed Rent until the date such reconciliation payment is made.

          Section 22.5.  After a determination of the Renewal Fair Market Rental
Value for each renewal term has been made, the parties shall execute and deliver
to each other an instrument setting forth the amount of Fixed Rent for such
renewal term, but the failure to do so

                                       59
<PAGE>

shall not affect Tenant's obligation to pay such Fixed Rent.

          Section 22.6.  In determining Renewal Fair Market Rental Value,
Landlord, Tenant and the appraisers, if an appraisal takes place pursuant to
Section 22.2, shall assume that (a) no rent concessions, rent abatements or free
------------
rent periods will be given to Tenant, (b) no Landlord contribution shall be made
for Tenant Alterations and (c) Landlord will not be obligated to pay any
brokerage commission, leasing commission or other similar fee by reason of
Tenant's renewal of the Lease.

                                   ARTICLE 23

                              RIGHT OF FIRST OFFER
                              --------------------

          Section 23.1.  If Landlord desires to sell the Premises or receives an
unsolicited offer to purchase the Premises, it shall first offer it to Tenant at
such price and terms as Landlord shall deem appropriate (the "Offer Price").
The offer shall be given to Tenant in writing setting forth the Offer Price and
Tenant shall have a period of thirty (30) days following notice of the offer in
which to elect to purchase the Premises. If Tenant elects to purchase, it must
give written notice to such election within said thirty (30) day period and
shall close the purchase within ninety (90) days after notice of its election to
purchase or such longer time as may be necessary for Tenant to comply with
applicable Gaming Laws, provided that, Tenant is diligently and continuously
making such filings and providing such information as may be required by the
Gaming Laws. The closing shall be on terms and conditions consistent with
Section 24.2. If Tenant fails to close after giving notice of election to
------------
purchase, then its right of first offer under this section shall automatically
terminate for the remainder of the Term. If Tenant does not elect to purchase
after notice hereunder, Tenant shall provide appropriate written notice thereof
and Landlord shall be authorized to sell the Premises for the Offer Price or
greater without offering the Premises to Tenant, only if such sale is not closed
within nine (9) months after Tenant's election (actual or deemed by virtue of a
failure to timely respond) not to purchase the Premises, Landlord's obligation
to first offer the Premises to Tenant, as set out above, shall again be in
effect. Such sale shall be subject to the Lease, except that Tenant's right of
first offer hereunder shall terminate and be of no further force and effect.

                                   ARTICLE 24

                                PURCHASE OPTION
                                ---------------

          Section 24.1.  Tenant shall have the right to purchase the Premises
upon the expiration of the Term of this Lease (the "Purchase Option"). In order
to purchase the Property pursuant to this Article 24, Tenant must deliver to
                                          ----------
Landlord a notice (the "Purchase Notice") within three hundred sixty (360) days
of the Expiration Date. The Purchase Notice shall (i) set forth Tenant's
calculation of the Purchase Price (as defined in Section 24.3 below) and (ii)
                                                 ------------

                                       60
<PAGE>

specify the date on which the Purchase Price shall be paid to Landlord which
shall be a date (the "Closing Date") not earlier than the Expiration Date and
not later than ninety (90) days from the date of the Expiration Date.

          Section 24.2.  The sale of the Property to Tenant (the "Closing")
shall be effected by delivery by Landlord to Tenant or its assigns of a duly
executed special warranty deed in statutory form for recording (the "Deed")
conveying fee simple title to the Property subject to (a) the Permitted
Encumbrances, (b) an assignment of Ground Lease in substantially the form
delivered to Landlord pursuant to the Exchange Agreement without any liability
to Landlord if the Ground Lessor fails to consent thereto, (c) all other matters
set forth in Article 2 of the Lease and (d) any lien, encumbrance, easement,
             ---------
right of way or other title matter created by, or with the consent of, Tenant.
The sale of the Property shall be "AS IS, WHERE IS, WITH ALL FAULTS" and the
acceptance by Tenant of the Deed and the recording thereof shall constitute full
performance by Landlord of every representation, warranty and covenant of
Landlord to be performed under this Lease.  To the extent that any Mortgage
prohibits prepayment, Tenant's purchase of the Property shall be subject to and
conditioned upon the requirements of the Mortgage, including without limitation,
the payment of any transfer fee (not to exceed 1% of the principal balance of
the Mortgage), the taking title by means of a bankruptcy remote, single purpose
entity and maintaining the Lease and the Guaranty in effect after the sale.
Tenant shall pay all transfer, recording and conveyance taxes incurred by the
recordation of the Deed and the premium of any owner's policy of title insurance
as well as all other costs associated with the sale of the Property, including
but not limited to, sales taxes, recording fees, any premium for any endorsement
to any existing mortgagee policy or any new mortgagee policy, the cost of any
endorsements required by Tenant or any lender, any search or closing and
charges, escrow fees, any loan assumption fee or prepayment premium and expenses
(including attorneys fees and expenses) imposed by Mortgagee. Fixed Rent under
the Lease shall be prorated as of the Closing Date. The Purchase Price shall be
paid on the Closing Date by wire transfer of immediately available funds to one
or more accounts designated by Landlord

          Section 24.3.  As used herein, the "Purchase Price" shall be deemed to
mean the "Fair Market Value" of the Premises less the outstanding principal
amount of any Mortgage created by Landlord which is assumed by Tenant as
purchaser. As used herein, "Fair Market Value" shall mean the price which an
unrelated third party under no obligation to purchase would be willing to pay
for the Premises unencumbered by the Lease and any Mortgage taking into account
then current market conditions and customs.

          Section 24.4.  Within thirty (30) days of Landlord's receipt of the
Purchase Notice, Landlord shall either accept or reject Tenant's calculation of
the Purchase Price. If Landlord rejects such calculation, it shall give Tenant
notice thereof together with its calculation of the Fair Market Value of the
Premises and thereafter the parties shall endeavor for a period of thirty (30)
days to agree upon the Fair Market Value of the Premises. If the parties fail
to agree upon the Fair Market Value of the Premises within such thirty (30) day
period, the Purchase Price shall be determined in accordance with Section 24.5.
                                                                  ------------

                                       61
<PAGE>

          Section 24.5.  If Landlord and Tenant shall fail to agree upon the
Fair Market Value of the Premises within thirty (30) days of the date of
Landlord's receipt of Tenant's Purchase Notice, then, within ten (10) Business
days thereafter, Landlord and Tenant each shall give notice to the other setting
forth the name and address of an independent real estate appraiser or consultant
having at least 10 years experience in the business of appraising or determining
the value of hotel and casino properties in Nevada and having the professional
qualification of MAI, SREA or CRE. If either party shall fail to give notice of
such designation within such ten (10) Business day period, then the appraiser
chosen shall make the determination alone. If two appraisers have been
designated, such two appraisers may consult with each other and shall, not later
than the 60th day after Landlord's receipt of Tenant's Purchase Notice choose
either Landlord's or Tenant's determination of the Purchase Price by
simultaneously giving written notice thereof to each of Landlord and Tenant, in
which case the determination so chosen shall be final and binding upon Landlord
and Tenant. If such two appraisers shall fail to concur within such thirty (30)
day period, then such two appraisers shall, within the next ten (10) days,
designate a third appraiser meeting the above requirements. The third appraiser
shall within thirty (30) days after its designation, choose either Landlord's or
Tenant's determination (and no other) by simultaneously delivering to Landlord
and Tenant signed and acknowledged original counterparts of his or her
determination within seven (7) days thereof.

          Section 24.6.  The costs and expenses of each party's appraiser shall
be paid by such party. The costs and expenses of the third appraiser shall be
shared equally by Landlord and Tenant.

                                   ARTICLE 25

                             EARLY PURCHASE OPTION
                             ---------------------

          Section 25.1.  In addition to its rights pursuant to Article 24,
                                                               ----------
Tenant shall have the right to purchase the Premises at the expiration of the
third Lease Year of the Term and the expiration of each Lease Year thereafter
(the "Early Purchase Option") through and including the expiration of the
Seventh Lease Year of the Term by giving written notice thereof to Landlord not
less than thirty (30) days prior to the Closing Date for such sale.

          Section 25.2.  (a)  The purchase price for each Early Purchase Option
shall be as follows:

               (i)      expiration of third Lease Year:    $35,569,747.75

               (ii)     expiration of fourth Lease Year:   $36,287,700.19

               (iii)    expiration of fifth Lease Year:    $37,020,144.04

                                       62
<PAGE>

               (iv)     expiration of sixth Lease Year:    $37,767,371.79

               (v)      expiration of seventh Lease Year:  $38,529,681.86

          (b)  To the extent that there has been a Taking as set forth in
Section 8.3, the purchase price set forth in Section 25.2(a) shall be reduced
-----------                                  ---------------
dollar-for-dollar by the amount of the award received by Landlord in connection
with such Taking.

          (c)  The purchase prices noted herein are the agreed upon projected
fair market value of all of the properties constituting the Premises at the
dates noted, consistent with Landlord and Tenant's respective analyses of the
Premises and its future values, including appraisals and opinions of appraisers
concerning the Premises and the market in which the Premises operate.

          Section 25.3.  Except for the purchase price set forth in Section
                                                                    -------
25.2, the terms and conditions set forth in Section 24.2 shall apply to Tenant's
----                                        ------------
acquisition of the Premises pursuant to its exercise of the Early Purchase
Option.

                                   ARTICLE 26

                             STIPULATED LOSS EVENT
                             ---------------------

          Section 26.1.  (a) If during the Term, there is an Event of Loss as
set forth in Section 7.1 or a Taking of the Premises as set forth in Section 8.1
             -----------                                             -----------
above, then Tenant shall pay to Landlord the stipulated loss value of the
Premises (the "Stipulated Loss Value") set forth in Section 26.2 within ninety
                                                    ------------
(90) days of the Event of Loss or Taking Date.

     (b) At any time after expiration of the seventh Lease Year, Tenant shall
have the right to have the Premises appraised by an appraiser satisfying the
qualifications set forth in Section 22.2 who shall deliver to Landlord and
                            ------------
Tenant a revised set of Stipulated Loss Values for the balance remaining of the
Term based upon an analysis of the Premises and its future value (the "Proposed
Revised Stipulated Loss Values"). If the Proposed Revised Stipulated Loss
Values are acceptable to Landlord, the parties shall enter into an amendment to
this Lease, deleting the Exhibit E attached hereto and substituting the Proposed
                         ---------
Revised Stipulated Loss Values therefore. If the Proposed Revised Stipulated
Loss Values are not acceptable to Landlord, the parties shall employ the
appraisal process set forth in Section 22.2 with respect to Renewal Fair Market
                               ------------
Rental Value in order to determine the Stipulated Loss Values for the Premises
for the balance for the Term which shall be reflected in an amendment to this
Lease substituting the Stipulated Loss Values determined pursuant to such
appraisal for those set forth in Exhibit E. The costs and expenses of the
                                 ---------
appraisers shall be borne by Tenant.

                                       63
<PAGE>

          Section 26.2.  In the event that Tenant is obligated to pay to
Landlord the Stipulated Loss Value pursuant to Section 26.1, Tenant shall have
                                               ------------
the option to purchase the Premises by giving written notice thereof to Landlord
within thirty (30) days of the Event of Loss or Taking Date, as the case may be,
the closing of which shall occur at the same time as the payment of the
Stipulated Loss Value to Landlord.

          Section 26.3.  In the event that Tenant elects to purchase the
Premises pursuant to Section 26.2, except for the payment of the Stipulated Loss
                     ------------
Value and no payment of a purchase price as otherwise provided in Section 24.3,
                                                                  ------------
the terms and conditions set forth in Section 24.2 shall apply to Tenant's
                                      ------------
exercise of its option to acquire the Premises pursuant to this Article 26.
                                                                ----------

                [Balance of this page left blank intentionally]

                                       64
<PAGE>

     The parties hereto have executed this Lease as of the day and year first
above set forth.

     LANDLORD:                HAHF PIONEER, LLC, a
                              Delaware limited liability company

                              By: Heller Affordable Housing of Florida, Inc.,
                                  its sole member

                                  By: /s/ Michael H. Jahrmarkt
                                     ----------------------------------
                                  Name: Michael H. Jahrmarkt
                                  Title: Sole Member

     TENANT:                  PIONEER HOTEL INC., a
                              Nevada corporation

                              By: /s/ Thomas K. Land
                                 ----------------------------------
                              Name: Thomas K. Land
                              Title: Senior Vice President & CFO

                                       65
<PAGE>

                                  EXHIBIT A-1
                                  -----------

                         LEGAL DESCRIPTION OF THE LAND

The land referred to herein is situated in the State of Nevada, County of CLARK,
described as follows:

PARCEL I:

That portion of Government Lot Four (4) of Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:

Lots One (1) and Two (2) as shown by map in File 40 of Parcel Maps, Page 30, in
the Office of the County Recorder of Clark County, Nevada.

TOGETHER WITH a Right-of-Way easement for road purposes with the right of egress
and ingress over and across a strip of land 60 feet in width lying immediately
West of and adjacent to the West line of the hereinabove described parcel of
land and over and across a strip of land 60 feet in width being the Northerly
extension of the first mentioned strip of land and along on an existing road.
The last mentioned strip of land is to terminate on an existing County Road
located near the Northwest Corner of Government Lot Three (3) in said Section
13.

EXCEPTING THEREFROM those portions of said land as taken by that certain Final
Order of Condemnation recorded April 10, 1989 in Book 890410 as Document No.
00511, described as follows:

Parcel 1 - Water Well Site - Fee Title:

Fee Simple Title in the name of BIG BEND WATER DISTRICT, a general improvement
district, its successors and assigns, to:

That portion of government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:

COMMENCING at the Northwest Corner of Lot Two (2) as designated by Parcel Map on
file in File 40, Page 30 of Parcel Maps in the Office of the County Recorder of
Clark County, Nevada; thence South 89(degrees)59'51" East along the North line
of said Lot Two (2) a distance of 720.00 feet to a point; thence South
0(degrees)00'09" West a distance of 18.00 feet to the TRUE POINT OF BEGINNING;
thence continuing South 0(degrees)00'09" West a distance of 14.00 feet to a
point; thence South 44(degrees)59'51" East a distance of 14.14 feet to a point;
thence South 83(degrees)59'51" East a distance of 30.00 feet to a point; thence
North 0(degrees)00'09" East a distance of 24.00 feet to a point; thence North
89(degrees)59'51" West a distance of 40.00 feet to the TRUE POINT OF BEGINNING.

                                     A-1-1
<PAGE>

Parcel 2 - Easement:

A perpetual easement in the name of BIG BEND WATER DISTRICT, a general
improvement district, its successors and assigns, "District", for the
construction, operation, maintenance, repair, renewal, reconstruction and
removal of a District water well, pipe lines, electrical line, pumps, casings,
meters, equipment, telemetry devices and appurtenances thereto belonging,
including ingress and egress, and for the accommodation of construction
equipment, building materials, refuse, drilling residues, and excavation
materials, over, along and across:

That portion of Government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:

COMMENCING at the Northwest Corner (NW Cor) of Lot Two (2) as designated by
Parcel Map on file in File 40, Page 30 of Parcel Maps in the Office of the
County Recorder of Clark County, Nevada; thence South 89(degrees)59'51" East
along the North line of said Lot Two (2) a distance of 768.39 feet to the TRUE
POINT OF BEGINNING; thence North 89(degrees)59'51" West a distance of 73.39 feet
to a point; thence South 0(degrees)00'09" West a distance of 43.00 feet to a
point; thence South 89(degrees)59'51" East a distance of 72.93 feet more or less
to a point on the East line of said Government Lot 4; thence Northerly along the
last mentioned East line a distance of 43.00 feet to the TRUE POINT OF
BEGINNING.

EXCEPTING from the hereinabove described parcel, the following described portion
thereof:

COMMENCING at the Northwest Corner (NW Cor) of said parcel; thence South
89(degrees)59'51" East along the North line thereof a distance of 30.00 feet to
a point; thence South 0(degrees)00'09" West a distance of 18.00 feet to the TRUE
POINT OF BEGINNING of the parcel described herein; thence South 0(degrees)00'09"
West a distance of 14.00 feet to a point; thence South 44(degrees)59'51" East a
distance of 14.14 feet to a point; thence South 89(degrees)59'51" East a
distance of 30.00 feet to a point; thence North 0(degrees)00'09" East a distance
of 24.00 feet to a point; thence North 89(degrees)59'51" West a distance of
40.00 feet to the TRUE POINT OF BEGINNING.

Said easement to prohibit buildings, structures, fences, trees or similar items
from being placed upon, over, or under such easement, except the same may be
improved and used for automobile parking, driveways, and landscaped with lawn
and shallow rooted shrubs and for similar purposes insofar as such uses do not
interfere with the use and enjoyment of the easement by the District.

EXCEPTING THEREFROM THAT PORTION CONVEYED TO CLARK COUNTY BY QUITCLAIM DEED
RECORDED MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00659, OFFICIAL RECORDS.

                                     A-1-2
<PAGE>

PARCEL II:

That portion of Government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:

COMMENCING at the Northwest Corner (NW Con of said Lot Four (4); thence South
lE10'14"  West, along the West line of said Lot Four (4), a distance of 900.20
feet to a point; thence East, a distance of 182.44 feet to the TRUE POINT OF
BEGINNING; thence North 01E05'50" East, a distance of 220.10 feet to a point;
thence East to a point on the East line of said Government Lot Four (4) ; thence
Southerly along the said East line to a point which bears due East from the TRUE
POINT OF BEGINNING; thence West, parallel to the North line of said Lot Four (4)
to the TRUE POINT OF BEGINNING. EXCEPTING THEREFROM THAT PORTION CONVEYED TO
CLARK COUNTY BY QUITCLAIM DEED RECORDED MARCH 12, 1990 IN BOOK 900312 AS
DOCUMENT NO. 00659, OFFICIAL RECORDS.

                                     A-1-3
<PAGE>

                                  EXHIBIT A-2
                                  -----------

                  LEGAL DESCRIPTION OF THE GROUND LEASED LAND
                  -------------------------------------------

PARCEL III:

A LEASEHOLD ESTATE, AS CREATED BY THAT CERTAIN LEASE DATED OCTOBER 31, 1978 BY
PALMALL PROPERTIES, INC, A CALIFORNIA CORPORATION, SHARON SCHUTZ AND JANICE
ILLIG (AS SUCCESSOR IN INTEREST TO CLARA J. TROUTMAN, DECEASED AND W.J. TROUTMAN
AKA WILMER J. TROUTMAN, DECEASED) AS ("LESSOR") AND PIONEER HOTEL INC. (AS
SUCCESSOR IN INTEREST TO COLORADO RIVER MOTEL AND CASINO, INC. AND COLORADO
RIVER RESORT HOTEL, INC. AND MARGARET ELARDI) AS ("LESSEE"); TERM: 99 YEARS,
COMMENCING ON JANUARY 1, 1979 AND ENDING ON DECEMBER 31, 2078 IN AND TO THE
FOLLOWING:

That portion of Government Lot Four (4), Section 13, Township 32 south, Range 66
East, M.D.B.&M., Clark County, Nevada, described as follows:

COMMENCING at the Northwest Corner (NW Cor) of Government Lot Four (4) in said
Section 13; thence South 1E10'14" West along the West line of said Lot Four (4)
a distance of 379.73 feet to a point; thence East parallel with the North line
of said Lot Four (4) a distance of 182.44 feet to the Northwest Corner (NW Cor)
of that certain parcel of land conveyed by E.L. CLEVELAND to ARTHUR HERBERT
SHIPKEY by Deed recorded February 8, 1960, as Document No. 187365 of Official
Records, Clark County, Nevada, the TRUE POINT OF BEGINNING; thence North
1E10'14" East a distance of 100.05 feet to a point; thence East and parallel
with the North line of said Lot Four (4) a distance of 766.45 feet to a point in
the East line of said Lot Four (4); thence South 10E34'08 West a distance of
101.73 feet to the Northeast Corner (NE Cor) of the hereinabove described parcel
conveyed to SHIPKEY; thence West a distance of 750.73 feet to the TRUE POINT OF
BEGINNING.

TOGETHER WITH Right-of-Way and easement for road purposes with the right of
egress and ingress over and across a strip of land 60 feet in width lying
immediately West of and adjacent to the West line of the hereinabove described
parcel of land and over and across a strip of land 60 feet in width being the
Northerly extension of the First mentioned strip of land and along on an
existing road. The last mentioned strip of land is to terminate on an existing
County Road located near the Northwest Corner (NW Cor) of Government Lot Three
(3) in said Section 13.

EXCEPTING THEREFROM THAT PORTION CONVEYED TO CLARK BY QUITCLAIM DEED RECORDED
MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00661, OFFICIAL RECORDS.

                                     A-2-1
<PAGE>

PARCEL IV:

A LEASEHOLD ESTATE, AS CREATED BY THAT CERTAIN LEASE DATED OCTOBER 31, 1978 BY
PALMALL PROPERTIES, INC. A CALIFORNIA CORPORATION, SHARON SCHUTZ AND JANICE
ILLIG (AS SUCCESSOR IN INTEREST TO CLARA J. TROUTMAN, DECEASED AND W.J. TROUTMAN
AKA WILMER J. TROUTMAN, DECEASED) AS ("LESSOR") AND PIONEER HOTEL INC. (As
SUCCESSOR IN INTEREST TO COLORADO RIVER MOTEL AND CASINO, INC. AND COLORADO
RIVER RESORT HOTEL, INC. AND MARGARET ELARDI) AS ("LESSEE"); TERM: 99 YEARS,
COMMENCING ON JANUARY 1, 1979 AND ENDING ON DECEMBER 31, 2078 IN AND TO THE
FOLLOWING:

That portion of Section 13, Township 32 South, Range 66 East, M.D.B.&M.,
described as follows:

COMMENCING at the Northwest Corner (NW Cor) of Government Lot Four (4) in said
Section 13; thence South 0E01'14" West along the West line of said Lot Four (4)
a distance of 900.20 feet to a point; thence East parallel to the North line of
said Lot Four (4) a distance of 182.44 feet to a point; thence North 1E41'09"
East a distance of 220.10 feet to the TRUE POINT OF BEGINNING; thence continuing
North 1E41'09" East a distance of 300.13 feet to a point; thence East and
parallel to the North line of said Lot Four (4) a distance of 750.73 feet more
or less to a point on the East line of said Lot Four (4); thence Southerly along
the said East line a distance of 305.87 feet more or less to a point which bears
East from the TRUE POINT OF BEGINNING; thence West a distance of 700.00 feet
more or less to the TRUE POINT OF BEGINNING.

TOGETHER WITH a Right-of-Way and easement for road purposes with the right of
egress and ingress over and across a strip of land 60 feet in width lying
immediately West of and adjacent to the West line of the hereinabove described
parcel of land and over and across a strip of land 60 feet in width being the
Northerly extension of the first mentioned strip of land and along on an
existing road. The last mentioned strip of land is to terminate on an existing
County Road located near the Northwest Corner (NW Cor) of Government Lot Three
(3) in said Section 13.

EXCEPTING THEREFROM THAT PORTION CONVEYED TO CLARK COUNT BY QUITCLAIM DEED
RECORDED MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00560 AND RE-RECORDED
MARCH 14, 1990 IN BOOK 900314 AS DOCUMENT NO. 00615, OFFICIAL RECORDS.

                                     A-2-2
<PAGE>

                                    EXHIBIT B
                                    ---------

                             SCHEDULE OF FIXED RENT

                            Month              Monthly Fixed Rent
                            -----              ------------------

                              1                    $284,580.72
                              2                     284,580.72
                              3                     284,580.72
                              4                     284,580.72
                              5                     284,580.72
                              6                     284,580.72
                              7                     284,580.72
                              8                     284,580.72
                              9                     284,580.72
                              10                    284,580.72
                              11                    284,580.72
                              12                    284,580.72
                              13                    284,580.72
                              14                    284,580.72
                              15                    284,580.72
                              16                    284,580.72
                              17                    284,580.72
                              18                    284,580.72
                              19                    284,580.72
                              20                    284,580.72
                              21                    284,580.72
                              22                    284,580.72
                              23                    284,580.72
                              24                    284,580.72
                              25                    284,580.72
                              26                    284,580.72
                              27                    284,580.72
                              28                    284,580.72
                              29                    284,580.72
                              30                    284,580.72
                              31                    284,580.72
                              32                    284,580.72
                              33                    284,580.72
                              34                    284,580.72
                              35                    284,580.72
                              36                    284,580.72
                              37                    338,651.06
                              38                    338,651.06

                                      B-1
<PAGE>

                            Month              Monthly Fixed Rent
                            -----              ------------------

                              39                    338,651.06
                              40                    338,651.06
                              41                   $338,651.06
                              42                    338,651.06
                              43                    338,651.06
                              44                    338,651.06
                              45                    338,651.06
                              46                    338,651.06
                              47                    338,651.06
                              48                    338,651.06
                              49                    348,810.59
                              50                    348,810.59
                              51                    348,810.59
                              52                    348,810.59
                              53                    348,810.59
                              54                    348,810.59
                              55                    348,810.59
                              56                    348,810.59
                              57                    348,810.59
                              58                    348,810.59
                              59                    348,810.59
                              60                    348,810.59
                              61                    359,274.91
                              62                    359,274.91
                              63                    359,274.91
                              64                    359,274.91
                              65                    359,274.91
                              66                    359,274.91
                              67                    359,274.91
                              68                    359,274.91
                              69                    359,274.91
                              70                    359,274.91
                              71                    359,274.91
                              72                    359,274.91
                              73                    370,053.15
                              74                    370,053.15
                              75                    370,053.15
                              76                    370,053.15
                              77                    370,053.15
                              78                    370,053.15
                              79                    370,053.15

                                      B-2
<PAGE>

                            Month              Monthly Fixed Rent
                            -----              ------------------

                              80                    370,053.15
                              81                   $370,053.15
                              82                    370,053.15
                              83                    370,053.15
                              84                    370,053.15
                              85                    421,860.59
                              86                    421,860.59
                              87                    421,860.59
                              88                    421,860.59
                              89                    421,860.59
                              90                    421,860.59
                              91                    421,860.59
                              92                    421,860.59
                              93                    421,860.59
                              94                    421,860.59
                              95                    421,860.59
                              96                    421,860.59
                              97                    444,204.92
                              98                    444,204.92
                              99                    444,204.92
                             100                    444,204.92
                             101                    444,204.92
                             102                    444,204.92
                             103                    444,204.92
                             104                    444,204.92
                             105                    444,204.92
                             106                    444,204.92
                             107                    444,204.92
                             108                    444,204.92
                             109                    467,732.74
                             110                    467,732.74
                             111                    467,732.74
                             112                    467,732.74
                             113                    467,732.74
                             114                    467,732.74
                             115                    467,732.74
                             116                    467,732.74
                             117                    467,732.74
                             118                    467,732.74
                             119                    467,732.74
                             120                    467,732.74

                                      B-3
<PAGE>

                           Month           Monthly Fixed Rent
                           -----           ------------------
                            121                492,506.73
                            122                492,506.73
                            123               $492,506.73
                            124                492,506.73
                            125                492,506.73
                            126                492,506.73
                            127                492,506.73
                            128                492,506.73
                            129                492,506.73
                            130                492,506.73
                            131                492,506.73
                            132                492,506.73
                            133                518,592.91
                            134                518,592.91
                            135                518,592.91
                            136                518,592.91
                            137                518,592.91
                            138                518,592.91
                            139                518,592.91
                            140                518,592.91
                            141                518,592.91
                            142                518,592.91
                            143                518,592.91
                            144                518,592.91
                            145                546,060.77
                            146                546,060.77
                            147                546,060.77
                            148                546,060.77
                            149                546,060.77
                            150                546,060.77
                            151                546,060.77
                            152                546,060.77
                            153                546,060.77
                            154                546,060.77
                            155                546,060.77
                            156                546,060.77
                            157                574,983.50
                            158                574,983.50
                            159                574,983.50
                            160                574,983.50
                            161                574,983.50

                                      B-4
<PAGE>

                           Month           Monthly Fixed Rent
                           -----           ------------------
                            162                574,983.50
                            163                574,983.50
                            164                574,983.50
                            165               $574,983.50
                            166                574,983.50
                            167                574,983.50
                            168                574,983.50
                            169                605,438.15
                            170                605,438.15
                            171                605,438.15
                            172                605,438.15
                            173                605,438.15
                            174                605,438.15
                            175                605,438.15
                            176                605,438.15
                            177                605,438.15
                            178                605,438.15
                            179                605,438.15
                            180                605,438.15
                            181                637,505.86
                            182                637,505.86
                            183                637,505.86
                            184                637,505.86
                            185                637,505.86
                            186                637,505.86
                            187                637,505.86
                            188                637,505.86
                            189                637,505.86
                            190                637,505.86
                            191                637,505.86
                            192                637,505.86
                            193                671,272.09
                            194                671,272.09
                            195                671,272.09
                            196                671,272.09
                            197                671,272.09
                            198                671,272.09
                            199                671,272.09
                            200                671,272.09
                            201                671,272.09
                            202                671,272.09

                                      B-5
<PAGE>

                            Month           Monthly Fixed Rent
                            -----           ------------------
                             203                671,272.09
                             204                671,272.09
                             205                706,826.77
                             206                706,826.77
                             207               $706,826.77
                             208                706,826.77
                             209                706,826.77
                             210                706,826.77
                             211                706,826.77
                             212                706,826.77
                             213                706,826.77
                             214                706,826.77
                             215                706,826.77
                             216                706,826.77
                             217                744,264.65
                             218                744,264.65
                             219                744,264.65
                             220                744,264.65
                             221                744,264.65
                             222                744,264.65
                             223                744,264.65
                             224                744,264.65
                             225                744,264.65
                             226                744,264.65
                             227                744,264.65
                             228                744,264.65
                             229                783,685.47
                             230                783,685.47
                             231                783,685.47
                             232                783,685.47
                             233                783,685.47
                             234                783,685.47
                             235                783,685.47
                             236                783,685.47
                             237                783,685.47
                             238                783,685.47
                             239                783,685.47
                             240                783,685.47

                                      B-6
<PAGE>

                                   EXHIBIT C
                                   ---------

                       SCHEDULE OF UNDERLYING AGREEMENTS
                       ---------------------------------

<TABLE>
<CAPTION>
 ----------------------------------------------------------------------------------------------------------------------------------
           Vendor                    Contract        Contract
            Name                         #             Date        Expires     Dept.                 Comments
 ----------------------------------------------------------------------------------------------------------------------------------
 <S>                                 <C>             <C>           <C>        <C>     <C>
 Arch Paging                                                                  Survl.
 ----------------------------------------------------------------------------------------------------------------------------------
 Arizona State Land Dept.             Permit         08/16/1998   08/15/2002  G&A      Land Use Permit and Lease for Fuel Dock.
                                     23-10037
 ----------------------------------------------------------------------------------------------------------------------------------
 ASCAP                                               01/01/2000   12/31/2000  G&A      Awaiting copy of license agreement for 2000.
 ----------------------------------------------------------------------------------------------------------------------------------
 Atlas Match Corp.                                   11/09/1999   11/09/2001  G&A      Fixed Price Purchase Commitment for Logo
                                                                                       Matches
 ----------------------------------------------------------------------------------------------------------------------------------
 Augustine, Gerald P.                 Arcade          Expired      Expired    G&A      Contract Expired.  Operating month by month.
                                     operation
 ----------------------------------------------------------------------------------------------------------------------------------
 Baron Pest Control                                  08/12/1997    Monthly    F&B      Pest inspection and control.
 ----------------------------------------------------------------------------------------------------------------------------------
 BHD Information Systems                             02/01/1996      N/A      MIS      Software license for Retail Pro. Gift shop
                                                                                       accounting, POS.
 ----------------------------------------------------------------------------------------------------------------------------------
 BMI                                                 01/01/2000   12/31/2000  G&A      Awaiting copy of license agreementfor 2000.
 ----------------------------------------------------------------------------------------------------------------------------------
 Cardiff Consulting Group International
 ----------------------------------------------------------------------------------------------------------------------------------
 Cerberus Pyrotronics                  20962         03/13/1998   03/10/2003  Sec.     Life Safety System Service greement
 ----------------------------------------------------------------------------------------------------------------------------------
 Clark Cablevision                                                Monthly     Hotel    Cable television provider, contract expired
 ----------------------------------------------------------------------------------------------------------------------------------
 Colorado River Internet                                          Monthly     MIS      Internet service provider
 ----------------------------------------------------------------------------------------------------------------------------------
 DecisionOne                          147280         08/15/1997       ??      G&A      Monitor maintenance agreement
 ----------------------------------------------------------------------------------------------------------------------------------
 Desert Lakes Golf Course          T11182000-216     08/01/2000   11/18/2000  G&A      Tournament 11/18/00.
 ----------------------------------------------------------------------------------------------------------------------------------
 Desert Recreation                                   06/15/2000   03/31/2005  G&A      Waverunner Rental and Fuel Dock Usage
 ----------------------------------------------------------------------------------------------------------------------------------
 Emerald River Golf Course         T11192000-880     03/10/2000   11/19/2000  G&A      Tournament 11/19/00.
 ----------------------------------------------------------------------------------------------------------------------------------
 Emerald River Golf Course         T02042001-914     03/20/2000   02/04/2001  G&A      Tournament 02/04/01.
 ----------------------------------------------------------------------------------------------------------------------------------
 Emerald River Golf Course         T11182001-945     03/20/2000   11/18/2001  G&A      Tournament 11/18/01.
 ----------------------------------------------------------------------------------------------------------------------------------
 Firemaster                                                                   Eng.     Fire Alarm System
 ----------------------------------------------------------------------------------------------------------------------------------
 Ford Motor Credit                                   10/01/1997   10/31/2001  G&A      Used 1997 Ford Van (48 months)
 ----------------------------------------------------------------------------------------------------------------------------------
 Galaxy Communications Inc.                          06/21/1999   06/24/2002  PBX      Pay Phones.
 ----------------------------------------------------------------------------------------------------------------------------------
 Global Cash Access                                  03/12/1999   03/12/2001  Cage     Quasi cash advance services (ATM and Credit
                                                                                       card)
 ----------------------------------------------------------------------------------------------------------------------------------
 GST Call-America (formerly Frontier Comm)                                             Hotel phone service
 ----------------------------------------------------------------------------------------------------------------------------------
 Highway Stations, The                                                        Mktg.    Radio advertising spots
 ----------------------------------------------------------------------------------------------------------------------------------
 Hospitality Network                                    Expired     Monthly   Hotel    In-room movies.
 ----------------------------------------------------------------------------------------------------------------------------------
 Johnson Business Machines                           07/22/2000   07/21/2001  Mktg.    Round Up Embosser
 ----------------------------------------------------------------------------------------------------------------------------------
 London Bridge Jet Tours                                Expired   Monthly     G&A      Dock Use Agreement
 ----------------------------------------------------------------------------------------------------------------------------------
 Loomis, Fargo & Co.                                 05/01/2000   05/01/2001  Cage     Armored car service.
 ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      C-1
<PAGE>

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
             Vendor               Contract        Contract
              Name                   #              Date       Expires        Dept.                    Comments
---------------------------------------------------------------------------------------------------------------------------------
<S>                               <C>           <C>           <C>             <C>     <C>
Martin Media                                    02/04/1998    02/04/2001      Mktg.   Outdoor Bulletin Contract.  Barstow CA.
-----------------------------------------------------------------------------------------------------------------------------------
Microbilt                                       06/24/1996      Expired       Cage    Equipment Rent for Cage Services
-----------------------------------------------------------------------------------------------------------------------------------
Micros Systems Inc.              MSA-128282                                    F&B    Maintenance Service Agreement - Upgrade in
                                                                                      process
-----------------------------------------------------------------------------------------------------------------------------------
Mission Industries                              07/09/1999    07/09/2004       F&B    Linens

-----------------------------------------------------------------------------------------------------------------------------------
NEC Business Network Solutions                      Waiting for update         PBX    Phone system maintenance agreement
-----------------------------------------------------------------------------------------------------------------------------------
Nevada, State of                                04/20/1994    04/19/2014       G&A    Floating dock permit
-----------------------------------------------------------------------------------------------------------------------------------
Pepsi-Cola Company                              08/01/1996    07/31/2001       F&B    Soft drink agreement
-----------------------------------------------------------------------------------------------------------------------------------
PDS Financial Corp.                             12/29/2000                            Gaming Equipment
-----------------------------------------------------------------------------------------------------------------------------------
Pitney Bowes                                                                   G&A    Mailing machine/scale maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Pitney Bowes                                    12/17/1996    12/17/2000       G&A    Copier lease/maintenance and usage agreement
-----------------------------------------------------------------------------------------------------------------------------------
Prime Cable                                     05/30/1996    05/30/2001       G&A    DMX music service
-----------------------------------------------------------------------------------------------------------------------------------
R&E Storage                                      Various        Various      Various  Various storage rentals contracts, prepaid
                                                                                      annually
-----------------------------------------------------------------------------------------------------------------------------------
Silver State Disposal                           08/31/1998    08/31/2003      Eng.    36-yard Compactor Lease
-----------------------------------------------------------------------------------------------------------------------------------
Silver State Disposal                           08/31/1998    08/31/2003      Eng.    26-yard Compactor Lease
-----------------------------------------------------------------------------------------------------------------------------------
Simplex Time Recorder                           07/01/1999    06/30/2000      Cage    Time stamp maintenance.  Prepaid annually
-----------------------------------------------------------------------------------------------------------------------------------
Statewide Fire Protection                                                     Eng.    Fire Sprinkler System
-----------------------------------------------------------------------------------------------------------------------------------
Stericycle, Inc. (formerly BFI                  10/31/1995       Monthly      Prtrs   Medical waste disposal
Waste Mgt.)
-----------------------------------------------------------------------------------------------------------------------------------
T.J. Wholesale                                  04/30/1998       Monthly       Pit    Agreement to package used playing cards.
-----------------------------------------------------------------------------------------------------------------------------------
Thyssen Elevator Corp.                          10/01/1998    10/01/2001      Eng.    Elevator Service ($250 per mo.)
-----------------------------------------------------------------------------------------------------------------------------------
Transworld Systems Inc.                         09/15/1999    09/14/2001      Cage    Collections System.
-----------------------------------------------------------------------------------------------------------------------------------
Tru-Measur Liquor System                                                       F&B    Liquor gun maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Western Money Systems                  3714     04/21/2000    04/21/2001      Cage    Glory currency counters maintenance
                                                                                      agreement
-----------------------------------------------------------------------------------------------------------------------------------
XpertX Service, Inc.                            03/01/2000    03/01/2001      Keno    Equipment and Software Maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Yesco                                           04/01/2000    03/31/2005      Eng.    Sign electrical maintenance agreement
-----------------------------------------------------------------------------------------------------------------------------------
Yesco                                 L25048C   05/01/1998    04/30/2000      Mktg.   Outdoor billboard advertising - Cal-Nev-Ari
-----------------------------------------------------------------------------------------------------------------------------------
Yesco                                                                         Mktg.   Outdoor billboard advertising
-----------------------------------------------------------------------------------------------------------------------------------
Yesco                                                                         Mktg.   Outdoor billboard advertising
-----------------------------------------------------------------------------------------------------------------------------------
Yesco                                                                         Mktg.   Outdoor billboard advertising
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      C-2
<PAGE>

                                   EXHIBIT D
                                   ---------

                              Memorandum of Lease
                              -------------------

     RECORDING REQUESTED BY AND
     WHEN RECORDED MAIL TO:

     Kevin J. O'Shea, Esq.

     Paul, Hastings, Janofsky & Walker LLP

     75 East 55th Street

     New York, New York  10022

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

                                NOTICE OF LEASE
                                ---------------

     NOTICE is hereby given, pursuant to Nevada Revised Statute Section 247.120
that effective as of December 29, 2000, HAHF PIONEER, LLC ("Landlord"), and
PIONEER HOTEL, INC. ("Tenant"), have entered into a Lease described as follows:

     1.   Landlord leases to Tenant, and Tenant leases from Landlord, the real
property located in the City of Laughlin, County of Clark, State of Nevada,
described in Exhibit "A" attached hereto.
             -----------

     2.   This Memorandum of Lease is subject to the terms, conditions and
provisions of that certain Net Lease  (the "Lease") between Landlord and Tenant
dated December 29, 2000, which is incorporated herein by reference as though set
out here in full.  The Lease shall control in the event of any conflict with
this Memorandum of Lease.

     3.   The initial term of this Lease is twenty (20) years. The Lease term
shall commence on December 29, 2000.  The initial term of the Lease may be
extended by Tenant in accordance with the terms of the Lease for up to two (2)
additional periods of five (5) years each.

     4.   The Lease contains an option in favor of Tenant to purchase the
Property and all improvements thereon.

                                      D-1
<PAGE>

     5.   Landlord and Tenant acknowledge that they are executing this
Memorandum of Lease on a date which is prior to the commencement of the Lease
term for purposes of facilitating its recording.

          IN WITNESS WHEREOF, the parties have executed this Memorandum of Lease
effective as of the date first above written.

                                      "LANDLORD"

                                HAHF PIONEER, LLC,
                                a Delaware limited liability company

                                By: /s/ Michael H. Jahrmarkt
                                   -----------------------------
                                   Its: Sole Member
                                       -------------------------

                                      "TENANT"

                                PIONEER HOTEL, INC., a Nevada corporation

                                By: /s/ Thomas K. Land
                                   -----------------------------------
                                    Its: SVP & CFO
                                        ------------------------------

                        [Attach Nevada acknowledgements]

                                      D-2
<PAGE>

                                   EXHIBIT E
                                   ---------

                            STIPULATED LOSS VALUES

       Lease           Stipulated
       Month           Loss Value
       -----           ----------
          1            $33,555,833.33
          2            $33,611,759.72
          3            $33,667,779.32
          4            $33,723,892.29
          5            $33,780,098.77
          6            $33,836,398.94
          7            $33,892,792.94
          8            $33,949,280.93
          9            $34,005,863.06
         10            $34,062,539.50
         11            $34,119,310.40
         12            $34,176,175.92
         13            $34,233,136.21
         14            $34,290,191.44
         15            $34,347,341.75
         16            $34,404,587.32
         17            $34,461,928.30
         18            $34,519,364.85
         19            $34,576,897.12
         20            $34,634,525.29
         21            $34,692,249.50
         22            $34,750,069.91
         23            $34,807,986.69
         24            $34,866,000.01
         25            $34,924,110.01
         26            $34,982,316.86
         27            $35,040,620.72
         28            $35,099,021.75
         29            $35,157,520.12
         30            $35,216,115.99
         31            $35,274,809.51
         32            $35,333,600.86
         33            $35,392,490.20
         34            $35,451,477.68
         35            $35,510,563.48
         36            $35,569,747.75
         37            $35,629,030.66
         38            $35,688,412.38
         39            $35,747,893.07

                                      E-1
<PAGE>

       Lease          Stipulated
       Month          Loss Value
       -----          ----------
         40           $35,867,152.01
         41           $35,926,930.60
         42           $35,986,808.82
         43           $36,046,786.83
         44           $36,106,864.81
         45           $36,167,042.92
         46           $36,227,321.32
         47           $36,287,700.19
         48           $36,348,179.69
         49           $36,408,759.99
         50           $36,469,441.26
         51           $36,530,223.66
         52           $36,591,107.37
         53           $36,652,092.54
         54           $36,713,179.37
         55           $36,774,368.00
         56           $36,835,658.61
         57           $36,897,051.38
         58           $36,958,546.46
         59           $37,020,144.04
         60           $37,081,844.28
         61           $37,143,647.35
         62           $37,205,553.43
         63           $37,267,562.69
         64           $37,329,675.29
         65           $37,391,891.42
         66           $37,454,211.24
         67           $37,516,634.92
         68           $37,579,162.65
         69           $37,641,794.58
         70           $37,704,530.91
         71           $37,767,371.79
         72           $37,830,317.41
         73           $37,893,367.94
         74           $37,956,523.56
         75           $38,019,784.43
         76           $38,083,150.74
         77           $38,146,622.65
         78           $38,210,200.36
         79           $38,273,884.02
         80           $38,337,673.83
         81           $38,401,569.95
         82           $38,465,572.57
         83           $38,529,681.86

                                      E-2
<PAGE>

       Lease          Stipulated
       Month          Loss Value
       -----          ----------
         84           $38,722,571.08
         85           $38,916,425.95
         86           $39,013,717.02
         87           $39,111,251.31
         88           $39,209,029.44
         89           $39,307,052.01
         90           $39,405,319.64
         91           $39,503,832.94
         92           $39,602,592.52
         93           $39,701,599.00
         94           $39,800,853.00
         95           $39,900,355.13
         96           $40,000,106.02
         97           $40,100,106.29
         98           $40,200,356.55
         99           $40,300,857.44
        100           $40,401,609.59
        101           $40,502,613.61
        102           $40,603,870.14
        103           $40,705,379.82
        104           $40,807,143.27
        105           $40,909,161.13
        106           $41,011,434.03
        107           $41,113,962.61
        108           $41,216,747.52
        109           $41,319,789.39
        110           $41,423,088.86
        111           $41,526,646.59
        112           $41,630,463.20
        113           $41,734,539.36
        114           $41,838,875.71
        115           $41,943,472.90
        116           $42,048,331.58
        117           $42,153,452.41
        118           $42,258,836.04
        119           $42,364,483.13
        120           $42,470,394.34
        121           $42,576,570.32
        122           $42,683,011.75
        123           $42,789,719.28
        124           $42,896,693.58
        125           $43,003,935.31
        126           $43,111,445.15
        127           $43,219,223.76

                                      E-3
<PAGE>

       Lease            Stipulated
       Month            Loss Value
       -----            ----------
        128             $43,544,178.98
        129             $43,653,039.42
        130             $43,762,172.02
        131             $43,871,577.45
        132             $43,981,256.40
        133             $44,091,209.54
        134             $44,201,437.56
        135             $44,311,941.15
        136             $44,422,721.01
        137             $44,533,777.81
        138             $44,645,112.25
        139             $44,756,725.04
        140             $44,868,616.85
        141             $44,980,788.39
        142             $45,093,240.36
        143             $45,205,973.46
        144             $45,318,988.40
        145             $45,432,285.87
        146             $45,545,866.58
        147             $45,659,731.25
        148             $45,773,880.58
        149             $45,888,315.28
        150             $46,003,036.07
        151             $46,118,043.66
        152             $46,233,338.76
        153             $46,348,922.11
        154             $46,464,794.42
        155             $46,580,956.40
        156             $46,697,408.79
        157             $46,814,152.32
        158             $46,931,187.70
        159             $47,048,515.67
        160             $47,166,136.96
        161             $47,284,052.30
        162             $47,402,262.43
        163             $47,520,768.08
        164             $47,639,570.00
        165             $47,758,668.93
        166             $47,878,065.60
        167             $47,997,760.77
        168             $48,117,755.17
        169             $48,238,049.56
        170             $48,358,644.68
        171             $48,479,541.29

                                      E-4
<PAGE>

       Lease            Stipulated
       Month            Loss Value
       -----            ----------
        172             $48,722,241.99
        173             $48,844,047.60
        174             $48,966,157.72
        175             $49,088,573.11
        176             $49,211,294.55
        177             $49,334,322.78
        178             $49,457,658.59
        179             $49,581,302.74
        180             $49,705,255.99
        181             $49,829,519.13
        182             $49,954,092.93
        183             $50,078,978.16
        184             $50,204,175.61
        185             $50,329,686.05
        186             $50,455,510.26
        187             $50,581,649.04
        188             $50,708,103.16
        189             $50,834,873.42
        190             $50,961,960.60
        191             $51,089,365.50
        192             $51,217,088.92
        193             $51,345,131.64
        194             $51,473,494.47
        195             $51,602,178.20
        196             $51,731,183.65
        197             $51,860,511.61
        198             $51,990,162.89
        199             $52,120,138.30
        200             $52,250,438.64
        201             $52,381,064.74
        202             $52,512,017.40
        203             $52,643,297.44
        204             $52,774,905.69
        205             $52,906,842.95
        206             $53,039,110.06
        207             $53,171,707.83
        208             $53,304,637.10
        209             $53,437,898.70
        210             $53,571,493.44
        211             $53,705,422.18
        212             $53,839,685.73
        213             $53,974,284.95
        214             $54,109,220.66
        215             $54,244,493.71

                                      E-5
<PAGE>

       Lease            Stipulated
       Month            Loss Value
       -----            ----------
        216             $54,516,055.21
        217             $54,652,345.34
        218             $54,788,976.21
        219             $54,925,948.65
        220             $55,063,263.52
        221             $55,200,921.68
        222             $55,338,923.98
        223             $55,477,271.29
        224             $55,615,964.47
        225             $55,755,004.38
        226             $55,894,391.89
        227             $56,034,127.87
        228             $56,174,213.19
        229             $56,314,648.73
        230             $56,455,435.35
        231             $56,596,573.94
        232             $56,738,065.37
        233             $56,879,910.53

                                      E-6
<PAGE>

                                   SCHEDULE 1
                                   ----------

                              FINANCIAL COVENANTS
                              -------------------

       Tenant agrees to comply with its obligations set forth in this Schedule
                                                                      --------
1. Certain terms used and not otherwise defined in this Schedule 1 shall have
-                                                       ----------
the respective meanings given to them in the Lease to which this Schedule 1 is
                                                                 ----------
attached.

          1.   Fixed Charge Ratio.
               ------------------

               (a) Tenant shall not permit the ratio (such ratio, the "Fixed
Charge Ratio") of Operating Cash Flow to Fixed Charges for any four consecutive
fiscal quarters of Tenant (a "Rolling Fiscal Year") to be less than 1.00 to 1;
provided, however, that (i) the first Rolling Fiscal Year for which the Fixed
--------  -------
Charge Ratio is applicable shall be the Rolling Fiscal Year ending on March 31,
2001 and (ii) for all fiscal quarters preceding the fiscal quarter ending March
31, 2001, Fixed Charge Ratio shall be calculated by using the Pro Forma Fixed
Charges for such fiscal quarters.

               (b) If the Fixed Charge Ratio as of the last day of any Rolling
Fiscal Year is less than 1.20 to 1, the Management Fees paid for such period
shall be reduced (or, if already paid, returned by SFGC) by such amount
necessary for the Fixed Charge Ratio to be 1.20 to 1. If the Fixed Charge Ratio
is less than 1.00 to 1 on the last day of any Rolling Fiscal Year, it shall
constitute an Event of Default under the Lease if not timely cured by Guarantors
in the manner set forth in the Guaranty.

          2.   Permitted Dividends, etc.  Tenant shall not declare or pay any
               -------------------------
dividends (other than dividends payable solely in capital stock of Tenant) or
return any capital to its stockholder(s) or authorize or make any other
distribution, payment or delivery of property or cash to its stockholder(s) or
redeem, retire, exchange or otherwise acquire, directly or indirectly, any
shares of any class of its capital stock or other ownership interests now or
hereafter outstanding (or any warrants for or options or stock appreciation
rights in respect of any such shares), or set aside funds for any of the
foregoing purposes (all of the foregoing "Dividends"), except that:

               (a) Payments of Management Fees when due and payable under the
Management Agreement and that are not otherwise limited by the terms of this
Schedule 1 shall not be deemed to be Dividends; and
----------

               (b) Payments made by Tenant to SFGC paid annually on or before
the 90/th/ day following the end of Tenant's fiscal year which do not exceed 50%
of Excess Cash Flow for the same period shall not be deemed to be Dividends.

          3.   Reserved.
               --------

          4.   Reserved.
               --------

                                 Schedule 1-1
<PAGE>

          5.   Non-Compete.  Tenant shall not own, manage or operate any hotel,
               -----------
casino or similar facility (other than the Premises) located within a 50 mile
radius of the town of Laughlin, Nevada.  Upon the termination of the Lease
pursuant to an Event of Default thereunder, this restrictive covenant shall
remain in force for a period of two years following such termination.  If the
Lease is terminated for any other reason, this restrictive covenant shall
terminate upon the termination of the Lease.

          6.   Affiliate Transactions.  Tenant will not enter into any contract
               ----------------------
or transaction or series of transactions after the date hereof with any
Affiliate other than on terms acceptable to Landlord in its sole discretion;
provided, however, that the foregoing restriction shall not apply to the
--------  -------
Management Agreement.

          7.   No Amendment to Management Agreement.  Tenant shall not amend
               ------------------------------------
or modify (or permit the amendment or modification of) the Management Agreement
without the prior written consent of Landlord, which consent may be withheld in
Landlord's sole and absolute discretion.

          8.   Limits on Tenant Debt.  Tenant shall not incur any Indebtedness
               ---------------------
other than (a) any obligations pursuant to the Gaming Lease, including any
amendments or replacements thereof, and any new leases in connection with
additional regulated gaming equipment purchased by Tenant from time to time, (b)
any obligations of Tenant or any of the Guarantors to Landlord under the
Exchange Agreement or any of the other documents executed in connection with the
transactions contemplated by the Exchange Agreement, (c) any obligations of
Tenant pursuant to that certain $1,900,000 note to an Affiliate of Tenant
bearing interest at not more than 10% per annum for a term of not more than 3
years, and (d) obligations not exceeding $250,000 per year pursuant to all other
leases.  Tenant shall not guarantee the Indebtedness or obligations of any other
entity; provided, however, that the foregoing restrictions shall not apply to
        --------  -------
the Guaranty.

          9.   Quarterly Compliance Certificate.  On or before the 30/th/ day
               --------------------------------
following the end of each fiscal quarter of Tenant, Tenant shall deliver to
Landlord a certificate (the "Quarterly Compliance Certificate") in the form of
Schedule 1-1 attached hereto.
------------

          10.  CAPX Reserve.  At the end of each fiscal year of Tenant, a CAPX
               ------------
reserve shall be established by Tenant for the benefit of Landlord in an amount
equal to the positive difference, if any, between $1,000,000 and the amount of
CAPX actually incurred for the recently-ended fiscal year.  A positive balance
in the CAPX reserve shall be reduced in succeeding years by the amount that
actual CAPX in any such year exceeds the greater of budgeted CAPX and
$1,000,000.

          11.  Certain Definitions.  The following definitions used in this
               -------------------
Schedule 1 shall have the meanings ascribed to them below:
----------

"Affiliate" of a specified Person is (a) any Person who, directly or indirectly,
Controls, is Controlled by or is under common Control with, the specified
Person, or (b) any Person

                                 Schedule 1-2
<PAGE>

who is related by marriage or blood (to the second degree of consanguinity) with
the specified Person.

"CAPX" shall mean, for each fiscal year of Tenant, the greater of (a) $1,000,000
and (b) actual capital expenditures, excluding any expenditures funded from the
Unrestricted Cash Collateral Account for (i) constructing a parking garage on
the Premises, (ii) purchasing the land subject to the Ground Lease, or (iii)
exercising the purchase option under the Gaming Lease (as defined in the
Exchange Agreement); provided, however, that as a condition to the exclusion of
any expenditures set forth in clauses (i) -(iii) above, Landlord must receive a
first priority security interest or lien on the acquired asset in a manner which
is acceptable to Landlord in its reasonable discretion (which would include a
requirement that any acquired real property first be legally subdivided and
segregated from the Premises at Tenant's expense).

"Contingent Obligation" shall mean, as to any Person, any obligation of such
Person guaranteeing or intended to guarantee any Indebtedness ("primary
obligations") of any other Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (a) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (b) to
advance or supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (c) to purchase property, securities or services primarily for the
purpose of assuring the holder of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (d) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation shall
                 --------  -------
not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith.

"Control" or "Controlled by" or "Controlling" or any derivative thereof, when
used with respect to any specified Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through ownership of voting securities or other
ownership interests, or by contract; provided, however, that, without limiting
                                     --------  -------
the generality of the foregoing, (a) any Person which, together with its
Affiliates, owns, directly or indirectly, securities representing more than 50%
of the value or ordinary voting power of a corporation or more than 50% of the
partnership, general partnership, membership or other ownership interests (based
upon value or vote) of any other Person is deemed to Control such corporation or
other Person, (b) a general partner shall always be deemed to Control any
partnership of which it is a general partner, and (c) a managing member of a
limited

                                 Schedule 1-3
<PAGE>

liability company shall always be deemed to Control any limited liability
company of which it is a managing member.

"EBITDA" shall mean, as of any date, the sum of the amounts for the twelve
months ending on such date of (a) net income calculated in accordance with GAAP,
(b) provisions for taxes based on income, (c) interest expense, (d) the non-cash
portion of any retirement, pension plan or deferred compensation expense
incurred by Tenant, (e) depreciation expense and (f) amortization expense
including any amortization or write-off related to the write-up of any assets as
a result of purchase accounting less the sum of (i) gains on sales of assets
(excluding sales in the ordinary course of business) and other extraordinary
gains and other one-time non-cash gains, all as determined on a consolidated
basis in accordance with GAAP, and (ii) any cash payment in such period that was
made in respect of any non-cash deferred compensation expense incurred in a
previous period but only to the extent that at or about the time such cash
payment is made Tenant does not receive a cash reimbursement in a like amount.

"Excess Cash Flow" shall mean the positive difference, if any, obtained by
subtracting (a) Fixed Charges for the preceding fiscal year plus $2,234,000 from
(b) Operating Cash Flow for such preceding  fiscal year; provided, however, that
                                                         --------  -------
Excess Cash Flow shall be reduced if and to the extent Tenant's then existing
unencumbered cash reserves are less than the sum of (i) statutory restricted
cash requirement for the next fiscal year period required by applicable Nevada
gaming laws and regulations, (ii) working capital required for the next fiscal
year period as set forth in Tenant's budget (which amounts in clauses (i) and
(ii)  shall be at least $2,500,000) and (iii) Fixed Charges for the next fiscal
year period as set forth in Tenant's budget.

"Exchange Agreement" shall mean the Exchange Agreement dated December 29, 2000
among Tenant, Pioneer LLC,  Landlord and Heller Affordable Housing of Florida,
Inc.

  "Fixed Charges" shall mean, for each Rolling Fiscal Year, the sum of (a) Fixed
Rent paid pursuant to the Lease plus (b) fixed rent paid pursuant to gaming
equipment leases relating to the Property plus (c) fixed rent paid pursuant to
the Ground Lease plus (d) amounts that may be paid in respect of Management Fees
plus (e) rental payments due under any other contractual obligations of Tenant
with respect to the Premises plus (f) CAPX.

"GAAP" shall mean generally accepted accounting principles in the United States
of America as in effect from time to time.

"Indebtedness" shall mean, as to any Person, without duplication, (a) all
indebtedness (including principal, interest, fees and charges) of such Person
for borrowed money or for the deferred purchase price of property (such as
installment sales contracts), including contracts for the deferred purchase
price of property that include the procurement of services, (b) the face amount
of all letters of credit issued for the account of such Person and all drafts
drawn thereunder, (c) all indebtedness of the type referred to in clause (a)
secured by any Lien on any property owned by such Person, whether or not such
liabilities have been assumed by such Person, (d) the aggregate amount required
to be

                                 Schedule 1-4
<PAGE>

capitalized under leases under which such Person is the lessee and (e) all
Contingent Obligations of such Person.

"Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any other
similar recording or notice statute, and any lease having substantially the same
effect as any of the foregoing).

"Lone Mountain Property" shall have the meaning given to such term in the
Exchange Agreement.

"Management Agreement" shall mean the Management Agreement dated December 30,
1998 between SFGC and Tenant, as amended pursuant to any amendments approved in
writing by Landlord pursuant to this Schedule 1.
                                     ----------

"Management Fees" shall mean the fees provided to be paid by Tenant pursuant to
the Management Agreement.

"Operating Cash Flow" shall mean, for each Rolling Fiscal Year, the sum of (a)
EBITDA plus (b) the amounts set forth in clauses (a) through (e) of the
definition of Fixed Charges.

"Person" means an individual, general or limited partnership, limited liability
partnership or company, corporation, trust, estate, real estate investment
trust, association or any other entity.

"Pro Forma Fixed Charges" shall mean, for each relevant fiscal quarter, (a) the
actual amounts incurred in such quarter for the expense categories described in
clauses (c), (d) and (e) of the definition of Fixed Charges and (b) instead of
any actual amounts incurred by Tenant for the expense categories described in
clauses (a), (b) and (f) of the definition of Fixed Charges, the amounts which
Tenant would have incurred in such quarter for the expense categories described
in clauses (a), (b) and (f) of the definition of Fixed Charges if such quarter
had occurred in 2001.

"Unrestricted Cash Collateral Account" shall mean the Account established
pursuant to the Exchange Agreement in the approximate amount of $5,000,000.

                          *   *   *

                       End of Schedule 1
                       -----------------

                          *   *   *

                                 Schedule 1-5
<PAGE>

                                 SCHEDULE 1-1
                                 ------------

                    LEASE QUARTERLY COMPLIANCE CERTIFICATE
                    --------------------------------------

Heller EMX, Inc.

500 West Monroe

Chicago, Illinois 60661

Attention:  Manager of Operations, Capital Finance Group

Ladies and Gentlemen:

         Reference is made to that certain Lease between Pioneer LLC ("Tenant"),
as Tenant, and HAHF Pioneer, LLC, as Landlord ( the "Lease") dated as of
December 29, 2000 and to the Schedule 1 attached to such document. Unless
                             ----------
otherwise defined herein, terms defined in the Lease and the attached Schedule 1
                                                                      ----------
are used herein with the same meaning.

         I, ____________, of Tenant, do hereby certify on behalf of Tenant as of
the quarter ended _____________, as follows:

1.       Fixed Charge Ratio of Tenant (Operating Cash Flow / Fixed Charges) for
         prior 12 months = __________. The Fixed Charge Ratio calculation is as
         follows:

              EBITDA =                                 $__________________

              Gaming Lease Rent =                      $__________________

              Ground Lease Rent =                      $__________________

              Management Fees =                        $__________________

                                 Schedule 1-6
<PAGE>

              Other Rental Payments =                  $__________________

              CAPX =                                   $__________________
         ----------------------------------------------------------------------

         Operating Cash Flow                           $__________________

                                          Divided by:

              Lease rent =                             $__________________

              Gaming Lease rent =                      $__________________

              Ground Lease rent =                      $__________________

              Management Fees =                        $__________________

              Other Rental Payments =                  $__________________

              CAPX =                                   $__________________

         ----------------------------------------------------------------------
         Fixed Charges                                 $__________________

                                 Schedule 1-7
<PAGE>

2.       Dividends Declared for Fiscal Year = $___________________.

         Dividends must not exceed 50% of Excess Cash Flow. Excess Cash Flow is
         calculated as follows:

              Operating Cash Flow for FYE  =                  $_______________

                            Less

              Fixed Charges plus $2,234,000 =                 $_______________
         -----------------------------------------------------------------------

         Excess Cash Flow                                     $_______________

                                      Also,
                                      ----

         Excess Cash Flow is reduced if insufficient reserves are maintained, as
         set forth in the definition of Excess Cash Flow and calculated as
         follows:

              Tenant Unencumbered Cash Reserves =             $_______________

                                 Less

              Nevada Statutory Restricted Cash

              Requirement for upcoming fiscal year =          $_______________

                                 Less

              Working Capital for upcoming fiscal year =      $_______________

                                 Less

              Fixed Charges for upcoming fiscal year =        $_______________
         -----------------------------------------------------------------------

         Total Cash Reserves                                  $_______________

              (if negative, deduct from Excess Cash Flow)

                                 Schedule 1-8
<PAGE>

3.       CAPX Reserve ($1,000,000 less actual CAPX) for preceding fiscal year =
         $_______________, calculated as follows:

                  Minimum CAPX Expenditure =                   $1,000,000

                                 Less

                  Actual CAPX for fiscal year =                $_______________
         -----------------------------------------------------------------------

                  Amount of Reserve for fiscal year =          $_______________

         Total Amount in CAPX Reserve =                        $_______________

4.       The delivery of this certificate shall constitute a re-affirmation of
         the covenants set forth in such Schedule 1.
                                         ----------

                                 Schedule 1-9
<PAGE>

     IN WITNESS WHEREOF, the undersigned has executed this certificate as of the
date set forth below.

                                         PIONEER HOTEL INC.

                                         By: /s/ Thomas K. Land
                                            ---------------------------------
                                         Name: Thomas K. Land
                                              -------------------------------
                                         Title: SVP & CFO
                                               ------------------------------
                                         Date: December 29, 2000
                                              -------------------------------

                     End of Schedule 1
                     -----------------

                         *   *   *

                                 Schedule 1-10
<PAGE>

                                   EXHIBIT F

                           ADJUSTMENTS TO FIXED RENT

     Following the expiration of the 84th month of the Term (i.e., January 31,
2008), the monthly Fixed Rent for each remaining month under the Lease shall be
increased by 5.32% per 100 basis points of the positive difference, if any,
between (a) the rate on January 31, 2008 of United States Treasury securities
having a term to maturity equal to ten years and (b) 5.10%. If the difference
between (a) and (b) is zero or less, there shall not be any adjustment to
monthly Fixed Rent. On or before March 4, 2008, Landlord shall provide Tenant
written notice of such adjustment to the Fixed Rent together with a revised
Exhibit B which shall set forth the monthly Fixed Rent for the balance of the
---------
Term (the "Rent Adjustment Notice").  The Rent Adjustment Notice shall
constitute an amendment to the Lease, binding upon Landlord and Tenant, absent
manifest error.

                                      F-1
<PAGE>

                                      INDEX

<TABLE>
<CAPTION>
ARTICLE    HEADING                                                                               PAGE
-------    -------                                                                               ----
<S>                                                                                              <C>
ARTICLE A  CERTAIN LEASE PROVISIONS...........................................................      1

ARTICLE B  CERTAIN DEFINITIONS................................................................      3

ARTICLE 1  PREMISES AND TERM..................................................................      8

ARTICLE 2  FIXED RENT AND ADDITIONAL RENT.....................................................      9

ARTICLE 3  IMPOSITIONS........................................................................     11

ARTICLE 4  USE AND OPERATION OF PREMISES......................................................     14

ARTICLE 5  CONDITION OF PREMISES, ALTERATIONS AND REPAIRS.....................................     16

ARTICLE 6  INSURANCE..........................................................................     20

ARTICLE 7  DAMAGE OR DESTRUCTION..............................................................     23

ARTICLE 8  CONDEMNATION.......................................................................     27

ARTICLE 9  ASSIGNMENT AND SUBLETTING..........................................................     29

ARTICLE 10 LANDLORD'S RIGHT TO SELL, MORTGAGE, ASSIGN; SUBORDINATION AND NON-DISTURBANCE......     33

ARTICLE 11 OBLIGATIONS OF TENANT; INDEMNIFICATION OF LANDLORD.................................     36

ARTICLE 12 DEFAULT BY TENANT; REMEDIES........................................................     40

ARTICLE 13 NO WAIVER..........................................................................     46

ARTICLE 14 ESTOPPEL CERTIFICATES..............................................................     47

ARTICLE 15 QUIET ENJOYMENT....................................................................     48

ARTICLE 16 SURRENDER..........................................................................     48

ARTICLE 17 ACCESS.............................................................................     49

ARTICLE 18 ENVIRONMENTAL MATTERS..............................................................     50

ARTICLE 19 FINANCIAL STATEMENTS...............................................................     54

ARTICLE 20 LIMITATION OF LIABILITY............................................................     55

ARTICLE 21 MISCELLANEOUS PROVISIONS...........................................................     56

ARTICLE 22 FAIR MARKET RENTAL VALUE...........................................................     58

ARTICLE 23 RIGHT OF FIRST OFFER...............................................................     60

ARTICLE 24 PURCHASE OPTION....................................................................     61

ARTICLE 25 EARLY PURCHASE OPTION..............................................................     62

ARTICLE 26 STIPULATED LOSS EVENT..............................................................     63
</TABLE>

                                      -i-
<PAGE>

EXHIBITS

Exhibit A-1    Legal Description of the Land

Exhibit A-2    Legal Description of the Ground Leased Premises

Exhibit B      Schedule of Fixed Rent

Exhibit C      Schedule of Underlying Agreements

Exhibit D      Memorandum of Lease

Exhibit E      Stipulated Loss Values

Exhibit F      Adjustments to Fixed Rent

Schedule 1     Financial Covenants

                                     -ii-

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