Document:

EXHIBIT 10.6

 

TRADEMARK LICENSE AGREEMENT

 

This TRADEMARK LICENSE AGREEMENT (this “License”) is made as of the 24th day of August, 2001, by and between HERBST GAMING,  INC., a Nevada corporation (“Licensee”), and TERRIBLE HERBST, INC., a Nevada corporation (“Licensor”).

 

WHEREAS, Licensor is the exclusive owner of certain trademarks, services marks, trade names, trade dress, designs and logos which have been used by Licensor in connection with the management and operation of retail services and facilities in the State of Nevada (the “Business”) and which include the marks “TERRIBLE HERBST,” “TERRIBLE’S” and the “Bad Guy Logo” (the “Licensed Marks”);

 

WHEREAS, Licensee, through various subsidiaries, operates a slot machine route, as well as, Terrible’s Town Casino, Terrible’s Lakeside Casino & RV Park and Terrible’s Town Casino & Bowl, all within the State of Nevada. Licensee also operates Terrible’s Hotel & Casino, located at 4100 Paradise Road, Las Vegas, Nevada (collectively “Licensee’s Business”);

 

WHEREAS, Licensee desires to obtain from Licensor, and Licensor is willing to grant to Licensee, a non-exclusive license to utilize the Licensed Marks on the terms and subject to the conditions set forth in this License.

 

NOW THEREFORE, in consideration of the mutual promises and agreements set forth below, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

 

1.  GRANT AND SCOPE OF LICENSE.

 

1.1  Grant of License.  Licensor hereby grants to Licensee a non-exclusive, personal and nontransferable right to use the Licensed Marks in the Business within the State of Nevada, as long as any such use complies with the quality control specifications provided for under Section 3 herein, and until this License is terminated in accordance with the terms herein. Licensee’s use shall include without limitation the following:

 

1.1.1  The right to use the Licensed Marks in connection with the selling, advertising and promotion of the services of Licensee’s Business, including, without limitation, use of the Licensed Marks in or on marquee signs, flyers, brochures, other promotional and marketing materials, electronic and print media, direct mail pieces, billboards, other signage and point-of sale advertising.

 

1.1.2  The right to negotiate for and develop joint promotions and sponsorships with third parties utilizing the Marks of such third party vendors, and the Licensee’s Marks along with the Licensed Marks; provided that any such use is made for the purpose of selling, advertising and promoting the goods and services of the Licensee’s Business.

 

1.1.3  The right to juxtapose the Licensed Marks with the Licensee’s Marks and otherwise use the Licensed Marks in close proximity with the Licensee’s Marks in any materials used to sell, advertise and promote the goods and services of the Licensee’s Business.

 

1.2  Limitations on Grant.

 

1.2.1  The license granted by this License is a non-exclusive license and nothing contained herein shall be deemed to grant to Licensee any exclusive rights to use the Licensed Marks.

 

1.2.2  Licensee acknowledges and agrees that the management and operation of the Licensee’s Business is separate, distinct and independent from the management and operation of the Business.

 

1.2.3  The Licensed Marks shall only be used by Licensee in Nevada (the “Territory”).

 

 

1.2.4  Licensee understands that Licensor has the exclusive right to ownership, use and goodwill associated with the Licensed Marks. Except as provided herein Licensee agrees not to use the Licensed Marks or any variation of such name or word in connection with the Licensee’s Business.

 

2.  CONSIDERATION.

 

2.1  In consideration for this License Licensee will pay Licensor a monthly license fee (the “Fee”) of One Hundred Two Thousand Five Hundred Dollars ($102,500.00) (inclusive of all applicable sales and other taxes) during the Term of this License. This license fee amount shall commence in September 1, 2001. Thereafter, on each anniversary of this Agreement, the license fee shall increase by 5%.

 

3.  MANNER OF USAGE; QUALITY CONTROL.

 

3.1  Standard of Quality.  Licensor agrees that Licensee shall have reasonable discretion in its use of the Licensed Marks in connection with the operation, direction, management and supervision of the Licensee’s Business. Licensee agrees that the quality of the goods and/or services offered under the Licensed Marks in connection with the Licensee’s Business shall be at least consistent with or better than the average quality of goods and/or services offered by Licensor under the Licensed Marks as of the date of this License (the “Quality Standard”). Licensee further agrees to comply with all applicable federal, state and local laws and regulations in its use of the Licensed Marks. Licensor agrees that whenever it uses the Licensed Marks in advertising or in any other manner in connection with the Licensee’s Business, Licensee shall clearly indicate Licensor’s ownership of the Licensed Marks. Licensee shall provide Licensor with samples of or a description of any signs, advertising, promotional material, literature, packages and labels which incorporate the Licensed Marks and which have been or will be prepared by or for Licensee and which are intended to be used by Licensee at least five (5) days prior to their use or publication for Licensor’s prior written approval. Notwithstanding the preceding sentence, Licensee shall not be required to obtain the prior written approval for the use of the Licensed Marks from Licensor if Licensee continues to use such Licensed Marks in a manner commensurate with Licensor’s historical use of the Licensed Marks. Licensor’s failure to approve such samples within five (5) days after such samples are submitted by Licensee shall be deemed an approval of the use of the Licensed Marks by Licensee. Once any use of a Licensed Marks is approved, such use shall be deemed approved for the Term of this License.

 

3.2  Compliance.

 

3.2.1  If Licensor in its good faith and reasonable judgment believes that Licensee has not complied with the Quality Standard (a “Deficiency”), Licensor will provide Licensee with written notice of such belief setting forth: (i) a detailed description of any such Deficiency, including the goods/services at issue, (ii) a reference to the particular Quality Standard of Licensor’s not complied with by Licensee, and (iii) a suggested plan for curing any such Deficiency which is cost efficient and can be reasonably executed by Licensee within the thirty (30) day cure period set forth in Section 3.2.2 herein.

 

3.2.2  Licensee shall have thirty (30) days after the date it receives notice from Licensor of any such Deficiency, sent in accordance with the terms of Section 3.2.1, to cure the Deficiency. If Licensee has failed to cure the Deficiency on or before the last day to cure the noticed Deficiency, Licensor shall have the right to forthwith terminate this License upon ten (10) business days prior written notice to Licensee; provided however that Licensor shall have no right to terminate this License in the event that such noticed Deficiency cannot reasonably be cured within the thirty (30) day time period specified and Licensee takes reasonable action to cure such Deficiency within

 

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the thirty (30) day time period specified. Upon the termination of this License under this Section 3, Licensee shall have no right to exploit or in any way use the Licensed Marks (or any of them) except as provided herein under Section 4.4.

 

4.  TERM AND TERMINATION.

 

4.1  Term.  The term of this License (the “Term”) shall continue for ten (10) years from the date of execution of this Agreement (the “Commencement Date”), unless terminated at an earlier date by either party in accordance with the terms set forth in this License. The Term may be extended by Licensee upon written notice to Licensee for five additional five (5) year periods subject to the terms and conditions hereof, with the exception of the License Fee, which shall be agreed upon at the time of extension.

 

4.2  Licensor’s Right to Terminate.  The license granted under this License shall terminate upon ten (10) business days’ prior notice to Licensee from Licensor in the event:

 

4.2.1  The Term of this Agreement expires;

 

4.2.2  A Licensed Mark is used by Licensee outside of the Territory or in a manner other than that agreed to herein, unless such use is consented to by Licensor, and Licensee fails to cure any such non-compliance within thirty (30) days after written notice to Licensee from Licensor setting forth, in detail the alleged breach or unlicensed used;

 

4.2.3  Licensee fails to comply with Nevada state or federal law relating to the use of the Licensed Marks by Licensee and fails to cure any such non-compliance within thirty (30) days after written notice to Licensee from Licensor setting forth in detail: (i) the non-compliance; (ii) the law violated; and (iii) a suggested plan for curing the non-compliance which is cost efficient and can be reasonably executed by Licensee within the a (30) day period;

 

4.2.4  Licensee assigns or transfers this License; provided however that Licensor shall have no right to terminate this License in the event of an assignment by Licensee in the event of a merger or reorganization of Licensee, a sale of all or substantially all of Licensee’s assets or a consolidation of the Licensee with any of its affiliates or related parties;

 

4.2.5  Upon the filing of bankruptcy by Licensee;

 

4.2.6  Any other material breach of the License by Licensee which is not cured by Licensee within thirty (30) days after written notice to Licensee from Licensor setting forth in detail: (i) a description of such material breach; (ii) the provision of the License breached by Licensee; and (iii) a suggested plan for curing the breach which is cost efficient and can be reasonably executed by Licensee within the thirty (30) day period.

 

Notwithstanding the foregoing, if any such non-compliance or breach set forth in the notice provided by Licensor to Licensee under Sections 4.2.2, 4.2.3 or 4.2.6 above cannot be reasonably cured within the thirty (30) day time period specified, Licensor shall have no right to terminate this License if Licensee has taken reasonable action to cure such non-compliance within the thirty (30) day time period specified.

 

4.3  Effects of Termination.  If this License is terminated for any reason, Licensee shall have the right, for a period of sixty (60) days from the effective date of such termination to “phase out” its use of the Licensed Marks (the “Phase Out Period”). During the Phase Out Period, Licensee shall take reasonable steps to cease use of the Licensed Marks. At the end of the Phase Out Period Licensee shall have no further rights to use the Licensed Marks under this License and shall refrain completely from its use, directly or indirectly, by advertising or otherwise, of any of the Licensed Marks or anything suggestive thereof.

 

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4.4  Obligations Surviving Termination.  Notwithstanding any termination of the license granted to Licensee under this License and any exercise by either party of any rights and remedies hereunder, any rights or remedies of Licensor under Articles 5 and 6 of this License and any cause of action or claim of Licensor, whether or not accrued at the time of termination, because of any breach of or failure to perform any obligation by Licensee under this License, shall survive any such termination of this License or exercise of rights to the degree necessary to permit their fulfillment or discharge for a period of twelve (12) months from the effective date of termination.

 

5.  AGREEMENTS, REPRESENTATIONS AND WARRANTIES.

 

5.1  Licensee’s Agreements, Representations and Warranties.

 

5.1.1  Licensee acknowledges and agrees that neither Licensee nor any parent, subsidiary or affiliate of Licensee shall (i) do any act which may in any way impair the rights of Licensor in and to the Licensed Marks, (ii) acquire or claim any right, title or interest in or to the Licensed Marks by virtue of the license granted to Licensee hereunder or as a result of Licensee’s use of the Licensed Marks as contemplated hereby, or (iii) in any way challenge the validity of the Licensed Marks or Licensor’s ownership thereof.

 

5.1.2  Licensee acknowledges and agrees that all use of the Licensed Marks shall inure to the benefit of Licensor.

 

5.1.3  Licensee shall not register or attempt to register any of the Licensed Marks or any mark which may be the same or confusingly similar to the Licensed Marks, including, without limitation, any translation or transliteration of the Licensed Marks.

 

5.1.4  Licensee shall not, without the prior written consent of Licensor, use any Licensed Mark or portion thereof in any manner other than in the manner permitted under this License.

 

5.1.5  Licensee shall not: (i) assign this License or any of its rights hereunder, or (ii) provide a sublicense or contract with a subcontractor for the use of the Licensed Marks. Licensee represents and warrants that it has the right and is authorized to enter into and perform under this License, and that the consummation of the transaction contemplated by this License will not constitute a breach or default or be in conflict with any prior agreement between Licensee and any other person.

 

5.1.6  Licensee represents and warrants to Licensor that Licensee shall comply with any and all applicable laws, rules and regulations and any applicable safety standards in Licensee’s exercise of its rights under this License.

 

5.2  Licensor’s Agreements, Representations and Warranties.

 

5.2.1  Licensor represents and warrants that (i) it has the right to grant the license granted hereunder to Licensee and it is authorized to enter into and perform under this License;(ii) the Licensed Marks do not infringe upon or violate any intellectual property right of any other person, and no actions have been asserted, are pending, or threatened against Licensor based upon or challenging or seeking to deny or restrict the use by Licensor of any Licensed Mark; (iii) no person is engaging in any activity that infringes upon the Licensed Marks or upon the rights of Licensor therein; and (iv) the consummation of the transaction contemplated by this License will not result in the termination or impairment of any of the Licensed Marks, or constitute a breach or default or be in conflict with any prior agreement between Licensor and any other person.

 

5.2.2  Licensor, nor any parent, subsidiary or affiliate of Licensor shall acquire or claim any right, title or interest in or to the Licensee’s Marks by virtue of the use of Licensee’s Marks in the Business.

 

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5.2.3  Licensor shall not use or register or attempt to register any other Mark of Licensee or any other Mark which may be the same or confusingly similar to Licensee’s Marks, including, without limitation, any translation or transliteration of Licensee’s Mark.

 

5.2.4  Licensor represents and warrants that it has the right and is authorized to enter into and perform under this License and that the consummation of the transaction contemplated by this License will not constitute a breach or default or be in conflict with any prior agreement between Licensee and any other person.

 

6.  INDEMNITY.

 

6.1  Licensee’s Indemnification Obligations.  Licensee assumes full responsibility for all goods and/or services offered or sold under the Licensed Marks in the Licensee’s Business and shall indemnify and hold harmless Licensor, its affiliates and their respective officers, directors, employees and agents from and against any and all losses, liabilities, claims, charges, actions, proceedings, demands, judgments, settlements, costs and expenses (including, without limitation, fees and expenses of counsel) which any of them may incur as a result of or arising in any way out of: (i) the sale or offer for sale by Licensee of any goods or services under any Licensed Marks in the Licensee’s Business; or (ii) a breach of any representation, warranty or agreement made by Licensee herein.

 

6.2  Licensor’s Indemnification Obligations.  Licensor assumes full responsibility for all goods and/or services offered or sold under the Licensed Marks at Licensor’s Locations and shall indemnify and hold harmless Licensee, its affiliates and their respective officers, directors, employees and agents from and against any and all losses, liabilities, claims, charges, actions, proceedings, demands, judgments, settlements, costs and expenses (including, without limitation, fees and expenses of counsel) which any of them may incur as a result of or arising in any way out of: (i) the sale or offer for sale by Licensee of any goods or services under any Licensed Marks in the Business; or (ii) a breach of any representation, warranty or agreement made by Licensor herein.

 

7.  INFRINGEMENT.

 

7.1  Identification of Infringement.  Licensee shall use reasonable efforts to promptly notify Licensor of any instance which comes to Licensee’s attention of possible infringement, illegal use, misuse or misappropriation of any of Licensor’s rights in the Licensed Marks. Licensee shall promptly provide to Licensor such cooperation and assistance as shall be reasonably requested by Licensor in all respects in identifying instances of possible infringement of any right of Licensor in the Licensed Marks.

 

7.2  Prosecution of Infringement Actions.  Licensee may institute, in its own name or in the name of Licensor, but in any event at the expense of Licensee, any and all legal actions or proceedings to enforce Licensor’s rights in the Licensed Marks, utilizing any and all applicable registrations of the Licensed Marks with the United States Patent and Licensed Mark Office which are owned by Licensor. In the event that any action is brought by Licensee to enforce Licensor’s rights in the Licensed Marks, any recovery shall be for the account of Licensor; provided, however, that Licensee shall have the right to offset all costs, fees and expenses (including attorneys’ fees) incurred by Licensee in connection with such legal action from the gross recovery in any such legal action.

 

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8.  BANKRUPTCY.  This License shall survive notwithstanding the fact that Licensor may: (i) not be able to pay its debts when they become due, (ii) make an assignment for the benefit of creditors, or (iii) file any petition or have any petition filed against it under the bankruptcy or insolvency laws.

 

9.  GENERAL.

 

9.1  Status of Parties.  Nothing set forth in this License shall be construed to constitute Licensee as the partner, employee or agent of Licensor, nor shall either party have any authority to bind the other in any respect, it being intended that each party shall remain an independent contractor responsible only for its own actions.

 

9.2  Notices.  Except as otherwise set forth herein, any agreement, approval, consent, notice, request or other communication required or permitted to be given by either party to the other under this License shall be in writing and shall be deemed to have been given (i) when delivered by hand or by courier, (ii) when five days have elapsed after its transmittal by registered or certified mail, postage prepaid, return receipt requested, or (iii) when transmitted by facsimile (with a copy simultaneously sent by registered or certified mail, postage prepaid, return receipt requested) to the address set forth below, in each case, with a copy provided in the same manner and at the same time to the copy recipients shown below:

 

If to Licensee, at:

 

Herbst Gaming, Inc.

5195 Las Vegas Boulevard, S.

Las Vegas, Nevada 89119

Attention: Edward J. Herbst

 

If to Licensor, at:

 

Terrible Herbst, Inc.

5195 South Las Vegas Boulevard

Las Vegas, Nevada 89119

Attn. Jerry Herbst, President

 

with a copy to:

 

Terrible Herbst, Inc.

5195 South Las Vegas Boulevard

Las Vegas, Nevada 89119

Attn. Sean Higgins, Esq.

 

or to such other address as the recipient party shall have designated by notice so given.

 

9.3  Entire Agreement.  This License constitutes the entire agreement of the parties relating to its subject matter and supersedes all prior oral or written understandings or agreements relating thereto. No promise, understanding, representation, inducement, condition or warranty not set forth herein has been made or relied upon by either party hereto.

 

9.4  Amendments.  This License may not be amended, modified or canceled except by a written instrument executed by both parties.

 

9.5  Binding Effect.  This License shall be binding upon and shall inure to the benefit of Licensor and Licensee and each of their respective successors and permitted assigns.

 

9.6  Assignment.  No party may assign any of its rights or obligations hereunder, except that neither Licensee nor Licensor may not withhold consent to an assignment of this License in the event

 

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of a merger or reorganization of the other party, a sale of all or substantially all of the other party’s assets or a consolidation of the other party with any of its affiliates or related parties. Notwithstanding anything to the contrary contained herein, Licensor agrees to allow Licensee to pledge this Agreement as security for the obligations of Licensee under that certain Indenture dated as of August 24, 2001, between Licensee, as issuer, its Subidiaries, as guarantors, and The Bank of New York, as trustee.

 

9.7  Waiver.  No waiver of, acquiescence in or consent to any breach of or default under this License shall be deemed a waiver of, acquiescence in or consent to any other breach or default occurring at any time.

 

9.8  Severability.  If any provision of this License, or the application of the provision to any person or circumstance, is held to be inconsistent with any present or future law, ruling, rule or regulation of any court or governmental or regulatory authority having jurisdiction over the subject matter of this License, such provision shall be deemed to be modified to the minimum extent necessary to comply with such law, ruling, rule or regulation, and the remainder of this License, or the application of such provision to persons or circumstances other than those as to which it is held inconsistent, shall not be affected. If any provision is determined to be illegal, unenforceable or void, and if the remainder of this License shall not be affected by such determination and is capable of substantial performance, then such void provision shall be deemed rescinded and each provision not so affected shall be enforced to the extent permitted by law.

 

9.9  Governing Law.  This License shall be governed by and construed in accordance with the laws of the State of Nevada applicable to contracts negotiated, executed and to be wholly performed in that State.

 

9.10  Counterparts.  This License may be executed in several counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same instrument.

 

9.11  Headings.  The headings in this License are for reference purposes only, do not constitute a part of this License and shall not affect its meaning or interpretation.

 

9.12  Confidentiality.  Each of the parties hereto agrees not to disclose the terms and conditions of this License to any third party (except as required by law) without the prior written consent of the other party.

 

IN WITNESS WHEREOF, the parties hereto have executed this Licensees of the day and year first written above.

 

	
HERBST GAMING, INC., a Nevada corporation
  	
 
  
	
 
  	
 
  
	
/s/ EDWARD J. HERBST
  	
 
  
	
 
  	
 
  
	
EDWARD J. HERBST
 President
  	
 
  
	
 
  	
 
  
	
TERRIBLE HERBST, INC., a Nevada corporation
  	
 
  
	
 
  	
 
  
	
/s/ JERRY E. HERBST
  	
 
  
	
 
  	
 
  
	
JERRY E. HERBST
 President
  	
 
  

 

7EXHIBIT 10.7

 

LEASE AGREEMENT

 

THIS LEASE, made this 1st day of July, 1997, by and between The Herbst Family Limited Partnership II(hereinafter “Lessor”), and E-T-T Enterprises, L.L.C. (Hereinafter “Lessee”).

 

WITNESSETH: that the Lessor in consideration of the rent herein specified to be paid by the Lessee, and the covenants and conditions herein mentioned, does hereby lease, let and demise, unto Lessee, and the Lessee does hereby rent from the Lessor that certain real property(Hereinafter the “Property”) situated in the County of Clark, State of Nevada, whose legal descriptions are attached hereto as Exhibit “A”, and incorporated herein by reference.

 

TO HAVE AND TO HOLD the same unto the said Lessee, its successors and assigns for the period and upon the terms and conditions hereinafter set forth.

 

THIS INDENTURE OF LEASE is made by the Lessor and accepted by the Lessee upon each of the following terms and conditions, namely:

 

1.  TERM:  This Lease shall be a twenty (20) year lease commencing on July 1, 1997.

 

2.  RENTAL:  The Lessee agrees to pay to the Lessor as rental for said demised premises the sum of Fourteen Thousand Four Hundred Sixteen Dollars ($14,416.00) per month on the first of each month for the duration of said lease.

 

3.  SECURITY:  Lessee agrees that buildings and improvements hereafter located or erected on premises at any time during the term of his Lease, or extension thereof, shall be and remain charged with the lien in favor of Lessor as security for the enforcement of all agreements of this lease by Lessee to be kept and performed. Such lien shall be prior to all other contracts, liens and other encumbrances whatsoever effecting the demised premises provided however that Lessor agrees that it will subordinate such lien for the actual cost of financing the erection of any improvements required by the Lessee in order to finance same, as well as, any lien required by Chevron U.S.A., Inc.

 

4.  QUIET POSSESSION:  Lessor hereby covenants, warrants, and agrees that at all times during the term hereof, provided Lessee is not in default hereunder, Lessee shall have the full, peaceful and quiet possession of the demised premises, and, further that Lessor has full right and power to make and enter into this lease.

 

5.  TAXES AND UTILITY CHARGES:  Lessee agrees to pay all real taxes, and assessments which may be levied against the improvements thereon and any personal property and trade fixtures located therein and will pay charges for light, power and other public utilities used by it in connection with the use of the demised premises.

 

6.  ALTERATIONS:  The Lessee agrees that before commencing any construction work on said premises or making any alterations on improvements placed upon said premises by him that he will notify Lessor in order that a notice of non-responsibility may be posted on said premises and recorded in accordance with the provisions of the Mechanic’s Lien Law of the State of Nevada.

 

7.  REQUIREMENTS FOR ALTERATIONS:  Lessee covenants and agrees that such alterations and/or changes shall be at his sole cost and expense and that prior written consent of the Lessor shall be obtained therefore; and provided that such changes and alterations shall conform with building codes and zoning regulations now or hereinafter legally effective, and promulgated by the State, County or Municipal authorities.

 

8.  REPAIRS:  Lessee agrees, at his cost and expense, to maintain and keep in good order, condition and repair the service station and all ancillary buildings or improvements to be constructed

 

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thereon by Lessee and all fixtures and equipment, including visible plumbing and electrical fixtures. The Lessee agrees to keep the premises clean and to have no nuisance, unsightly rubbish, or to commit or cause to be committed by its employees, and/or sub-tenants, any violation of the laws, rules or regulations of the State, County or Municipal Board of Health or appropriate sanitary agency.

 

9.  TITLE TO FIXTURES:  All buildings, fixtures and other property and materials installed in the demised premises by the Lessee shall be and remain the property of the Lessee, and at the expiration of the Lease, the Lessee may, within thirty (30) days, remove from said premises all of such fixtures, property, and materials, provided that all expenses connected with the removal thereof shall be at the expense of the Lessee. The Lessee further agrees to repair at his sole expense all damage that may result from the removal of such building, fixtures and other property and to restore said premises to the condition in which they were prior to the start of construction and that no building or improvements placed upon said premises by Lessee shall be removed during the term of this Lease or extension thereof without the consent of Lessor first had and obtained.

 

10.  LIABILITY AND FIRE INSURANCE:  The Lessor shall require the Lessee to carry, maintain and have in full force and effect fire, workmen’s compensation, public liability, and product liability insurance with a recognized insurance company authorized to transact business in the State of Nevada for the benefit of the Lessor and Lessee, and for the protection of all persons who may suffer injury while in, on or about said premises. Said policy shall carry an amount of coverage for injury to one person in any one accident in the sum of One Hundred Thousand Dollars ($100,000.00) and for more injury to more than one person in any one accident in the sum of Three Hundred Thousand Dollars ($300,000.00). Lessor shall be furnished with copies of said policies and all endorsements thereto.

 

The Lessee shall carry insurance against loss by destruction of the demised premises caused by fire, explosion or other action of the elements, except loss caused by earthquake, equal to ninety per cent (90%) of the value of the improvements.

 

11.  COMPLIANCE WITH THE LAW:  The Lessee shall conduct his business in such manner as will comply with all requirements of all State, Federal, County and Municipal authorities, appertaining to the business conducted upon the demised premises, and Lessee shall not permit the demised premises to be used for any unlawful purposes.

 

12.  DEFAULT:  In the event Lessee shall be in default in the payment of any rent herein reserved, or in the performance of any of the covenants or conditions of this Lease to be kept and performed by the Lessee, and such default shall continue for thirty (30) days from and after service upon the Lessee of written notice of such default, signed by the Lessor or their duly authorized agents, then and in any such event, the Lessor may, at their option declare this Lease terminated and repossess themselves of said premises and take such action or pursue such remedy as may be permitted under the law of the State of Nevada. However, if Lessee commences the necessary work to cure said default before the expiration of the thirty (30) days, but the work takes in excess of thirty days, then Lessor shall not be allowed to declare this Lease terminated.

 

13.  LIENS:  The Lessee agrees that he will, at all times, save the Lessor and keep it blameless and the demised premises free and harmless of and from any liability on account of or in respect to any mechanic’s liens or liens in the nature thereof, for work and labor done, or materials furnished at the instance and request of the Lessee, in, on or about the demised premises; provided, however, that the Lessee shall have the right to contest the claim of such lien, in which event the Lessee shall, at his expense, furnish to the Lessor a sufficient surety bond executed by a reputable and responsible surety company, in at least double the amount of such claim of such lien, conditioned upon the diligent prosecution of such defense, and to hold the Lessor from and clear of all loss, costs, damages, and expenses of every kind and nature, arising either directly or indirectly out of said contest, and to pay any judgment that may be obtained forthwith upon the same being entered.

 

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14.  ATTORNEY FEE:  In the event of litigation arising from default in performance of any of the provisions of this Lease by either the Lessor or Lessee, the prevailing party in such litigation shall be entitled to receive from the other party reasonable attorney fees and costs of action incurred in connection with said litigation. In the event that either Lessor or Lessee shall by reason of acts of omission or commission in violation of the terms of the Lease, be made a party to any litigation commenced by a person other than the parties hereto, then such party performing the said act or suffering the said omission shall pay all costs, expenses and reasonable attorney fees incurred by the other party which arise from or are in connection with such litigation.

 

15.  INDEMNIFICATION:  Lessee shall indemnify and hold harmless Lessor and its agents, servants, employees and representatives from and against all claims, damages, losses and expenses, including attorneys’ fees arising out of or resulting from Lessee’s occupancy, provided, however, that Lessor, its agents, employees, representatives, successors, or assigns are not negligent with regards to same. This Paragraph shall have full force and effect upon execution of this Lease Agreement.

 

16.  ASSIGNMENT:  The Lessee shall not have the right to assign this Lease or hypothecate the same without first receiving the written consent of the Lessor, which consent shall not unreasonably be withheld. Lessee shall have the right to sublet any portion of the Property, providing that the tenancy of such sub-tenant shall be subject to all the terms, covenants and conditions of this Lease.

 

17.  WAIVER:  The waiver of either party of any of the covenants herein contained shall not be deemed a waiver of such party’s right to enforce the same or any other covenant contained herein.

 

18.  HOLDING OVER:  If the Lessee shall hold over the premises beyond the term herein specified, or any renewal thereof, with the consent, express or implied of the Lessor such holding over shall be construed to be a month-to-month tenancy, unless otherwise mutually agreed upon.

 

19.  PHRASE INTERPRETATION:  The term “Lessor” shall include the singular, if necessary. The term “Lessee” or the phrase “the term hereof” shall include any renewal or renewal thereof where permitted by the context hereof.

 

20.  PRINCIPAL PLACE OF BUSINESS FOR NOTICES:  Any and all notices shall be forwarded to the following addresses:

 

Lessee:

 

E-T-T Enterprises, L.L.C.
 5195 Las Vegas Blvd. South
 Las Vegas, Nevada 89119
 Attn: Edward J. Herbst

 

Lessor:

 

Herbst Family Limited Partnership II
 5195 Las Vegas Blvd. South
 Las Vegas, Nevada 89119
 Attn: Jerry Herbst

 

21.  NO OTHER AGREEMENTS:  Both parties hereby certify and declare that neither party has made any representations nor agreements to or with any other party in addition to, or in conflict with the terms, covenants and conditions hereof, and this Lease contains all of the terms, covenants and conditions and representations between the parties upon the subject matter hereof.

 

22.  TERMINATION OF LEASE IF LEGAL PROCEEDINGS FILED:  If, at any time during the term hereof, proceedings in bankruptcy shall be instituted by or against the Lessee and result in an adjudication of bankruptcy, or if the Lessee shall file or any creditor shall file, or any person shall file any Petition in Bankruptcy under Chapters 10 or 11 of the Bankruptcy Act of the United States of

 

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America as such act is now in force or as same may be amended, and shall by judicially approved, or if a Receiver of the business or assets of the Lessee shall be appointed and if such appointment be not vacated within sixty (60) days after notice thereof to Lessee, or if a general assignment is made by the Lessee for the benefit of creditors, or any sheriff, Marshall, constable, or other duly constituted public official take possession thereof by authority of any attachment or execution proceedings, and offer same for sale publicly, the Lessor may, at its option, in either or any of such events, without notice to Lessee or any other person or persons, immediately recapture and take possession of the demised premises and terminate this Lease with or without the process of law, such process being expressly waived by Lessee.

 

23.  CARE OF PREMISES:  Lessee agrees that it will water, cultivate, trim and keep in a neat condition any shrubs, plants or lawn planted on said premises and will keep the parking areas and black top in a neat and clean condition and will use for parking.

 

24.  OPTION TO RENEW:  The Lessee upon giving written notice to Lessor, at least sixty (60) days prior to the date of the expiration of the term aforesaid, provided he has faithfully complied with the terms hereof, shall have the option of renewing this Lease for up to five (5) additional ten (10) year terms subject to the same terms, covenants and conditions and agreements as contained herein other than this paragraph. The monthly rental for each renewal term shall be determined at the time of each renewal.

 

25.  RIGHT OF FIRST REFUSAL:  In the event of a contemplated sale of the premises during the demised term, the Lessor agrees to give Lessee a notice in writing at least ten (10) days before the contemplated sale of substance of terms on which it is proposed to be made, which notice shall be registered mail directed to Lessee at his principal place of business for notices; and thereupon within ten (10) days from the date of mailing of notice the Lessee shall have the right to purchase premises upon the terms and conditions proposed, and on the failure of the Lessee to exercise such option within the time aforesaid the option hereby granted to Lessee shall be and stand canceled.

 

26.  TIME IS OF ESSENCE:  Time is of the essence in this Lease and of each and every one of the provisions herein contained.

 

27.  BINDING EFFECT:  The covenants and agreements contained in this Lease shall be binding upon the parties hereto and upon their respective heirs, executors, administrators, successors and assigns.

 

IN WITNESS WHEREOF, the parties have caused this Lease to be executed by their duly authorized officers as of the day and year first herein written.

 

	
LESSOR:
  	
 
  
	
The Herbst Family Limited Partnership II
  	
 
  
	
 
  	
 
  
	
/s/ Jerry Herbst
  	
 
  
	
 
  	
 
  
	
Jerry Herbst, Partner
  	
 
  
	
 
  	
 
  
	
LESSEE:
  	
 
  
	
E-T-T Enterprises, L.L.C.
  	
 
  
	
 
  	
 
  
	
/s/ Timothy P. Herbst
  	
 
  
	
 
  	
 
  
	
Timothy P. Herbst, Member
  	
 
  

 

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