Document:

EXHIBIT 10.16

 

OPTION
AGREEMENT

 

This OPTION AGREEMENT (“Agreement”) to
acquire property is made this 18th day of, April 2006 (“Effective
Date”) by and between Jacobs Entertainment, Inc.,
a Delaware corporation, hereinafter referred to as PURCHASER, and Flats Development, Inc., an Ohio
corporation, hereinafter referred to as SELLER.

 

WITNESSETH:

 

SELLER hereby grants PURCHASER the Option to
purchase certain property in Cleveland, Ohio as follows:

 

1.                                       GRANT
OF OPTION:  For two (2) years (“Option
Period”) following the Effective Date SELLER grants to PURCHASER the option to
purchase (“Option”) the property outlined herein. Such Option Period may be
extended for two (2) additional years at the election of the PURCHASER by
notifying SELLER in writing of its intention to extend such Option Period
within thirty (30) days prior to the expiration of the Option Period (“Extension
Notice”).

 

2.                                       OPTION
PRICE:  PURCHASER shall pay to SELLER $50,000 (“Option Payment”) upon execution
of this Agreement and on each anniversary of the Effective Date including after
the Extension Notice, as consideration for such Option. The Option Payments
shall be non-refundable but applicable against the Purchase Price.

 

3.                                       PROPERTY:  That certain property on the West Bank of the
Cuyahoga River in Cleveland, Ohio forming part of the parking lot of the
Nautica Entertainment Complex (“Nautica”) comprised of land approximately 76,913 s.f. and improvements thereon, if
any, and which are Parcels # 003-17-015, and
approximately 17% of Parcel # ###-##-#### on the Tax Maps for Cuyahoga
County, Ohio, as well as a reversionary interest at June 26, 2026 in land comprised of approximately 380,795 s.f. (“Property”). A map of the
Property is attached as Exhibit A.

 

4.                                       PURCHASE
AGREEMENT. The Purchase Agreement between the parties (“Purchase Agreement”)
shall reflect the terms of this Agreement and be in substantially the same form as
that attached as Exhibit B. The Purchase Agreement shall be executed
within five (5) days following exercise of the Option as provided herein.

 

5.                                       DUE
DILIGENCE:  Upon execution of this
Agreement, PURCHASER will evaluate the Property. During such evaluation,
PURCHASER shall conduct such tests as it deems necessary in its sole
discretion, including but not limited to environmental and geotechnical tests
and preparation of a survey and title report. SELLER shall cooperate with
PURCHASER during its evaluation, including providing access to the Property,
and provide to PURCHASER copies of existing reports concerning the Property. The
PURCHASER shall conduct its evaluation so as not to impede or otherwise effect
or

 

1

 

inconvenience
SELLER’S use or enjoyment of the Property or any business conducted thereon.

 

6.                                       EXERCISE
OF THE OPTION:  If PURCHASER decides to
exercise the Option granted herein, PURCHASER will notify the SELLER of its
decision in writing before the end of the Option Period and the parties shall
proceed to Purchase Agreement execution as provided herein. The Option may be
exercised at any time during the Option Period, as extended. If the PURCHASER
does not notify SELLER before the end of the Option Period, then this Option
Agreement shall expire and neither party shall have any further liability
hereunder.

 

7.                                       NOTICES: 
Any notice, request or demand required or permitted to be given pursuant
to this Agreement shall be in writing and shall be deemed sufficiently given
if, delivered by hand by messenger at the address of the intended recipient,
sent prepaid by Federal Express (or a comparable guaranteed overnight delivery
service), or deposited in the United States first class mail (registered
or certified, postage prepaid, with return receipt requested), addressed to the
intended recipient, at the intended recipient’s address set forth below, or at
such other address as the intended recipient may have specified by written
notice to the sender given in accordance with the requirements of this
Paragraph. Any such notice, request or demand so given shall be deemed given on
the day it is delivered by messenger at the specified address, or on the day of
deposit in the United States Mail, as the case may be.

 

	
   

  	
  For the SELLER:

  	
   

  	
  Mrs. Helen Chaney

  
	
   

  	
   

  	
   

  	
  711 Spindlewood

  
	
   

  	
   

  	
   

  	
  Fearrington Post

  
	
   

  	
   

  	
   

  	
  Pittsboro, NC 27312

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a Copy to:

  	
   

  	
  David R. Frankstone

  
	
   

  	
   

  	
   

  	
  1414 Raleigh Road, Suite 320

  
	
   

  	
   

  	
   

  	
  The Exchange West at Meadowmount

  
	
   

  	
   

  	
   

  	
  Chapel Hill, NC 27517

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  For the PURCHASER:

  	
   

  	
  Stephen A. Roark, CFO

  
	
   

  	
   

  	
   

  	
  Jacobs Entertainment, Inc.

  
	
   

  	
   

  	
   

  	
  17301 West Colfax

  
	
   

  	
   

  	
   

  	
  Golden, Colorado 80401

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a Copy to:

  	
   

  	
  Samuel E. Wing, Esq.

  
	
   

  	
   

  	
   

  	
  Jones & Keller

  
	
   

  	
   

  	
   

  	
  1625 Broadway, Suite 1600

  
	
   

  	
   

  	
   

  	
  Denver, Colorado 80202

  

 

8.                                       CHOICE
OF LAWS:  This Agreement shall be
governed by the laws of the State of Ohio, without regard to conflict of laws
principles.

 

2

 

9.                                       AUTHORITY:  Each party signing below warrants and
represents that he or it has the
authority to execute this Agreement. This Agreement shall be binding on and
inure to the benefit of each party’s successors and assigns.

 

10.                                 SALES
COMMISSION:  The parties acknowledge that
neither has been represented by a real estate broker or other agent in this
transaction and each party agrees to defend and indemnify the other from and
against any and all claims of a third-party real estate broker or agent for
commissions being made though such party.

 

11.                                 ASSIGNMENT.
This Agreement may be assigned by the PURCHASER to an entity in which it
owns a controlling interest or to an entity acquiring all or substantially all
of the assets of the PURCHASER.

 

12.                                 COUNTERPARTS.
This Agreement may be executed in one or more counterparts, together which
constitute the Agreement.

 

13.                                 ENTIRE
AGREEMENT: This Agreement together with the Purchase Agreement, contain the
entire agreement between the parties hereto relating to the Property and shall
not be amended or modified unless set forth in writing between the parties.

 

Agreed and Accepted as of the Effective Date.

 

	
  PURCHASER:

  	
   

  
	
   

  	
   

  
	
   

  	
  Jacobs Entertainment, Inc.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Stephen R. Roark

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stephen R. Roark

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
  SELLER:

  	
  Flats Development, Inc.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Helen Chesney

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Helen Chesney

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
								

 

3EXHIBIT 10.17

 

OPTION AGREEMENT

 

This
OPTION AGREEMENT (“Agreement”) to lease property is made this 11th day of July,
2006 (“Effective Date”) by and between Jacobs
Entertainment, Inc., a Delaware Corporation, hereinafter referred to
as TENANT, and Sycamore & Main, Inc.,
an Ohio corporation, hereinafter referred to as LANDLORD.

 

WITNESSETH:

 

LANDLORD
hereby grants TENANT the Option to lease certain property in Cleveland, Ohio as
follows:

 

1.                                      GRANT OF OPTION:  For two (2) years (“Option Period”) following
the Effective Date of this Agreement, LANDLORD grants to TENANT the option to
lease (“Option”) the property outlined herein. Such Option Period may be
extended for two (2) additional years at the election of the TENANT by
notifying LANDLORD in writing of its intention to extend such Option Period
within thirty (30) days prior to the expiration of the Option Period
(“Extension Notice”).

 

2.                                      OPTION PRICE: 
TENANT shall pay to LANDLORD $50,000
in immediately available funds upon execution of this Agreement, and on each
anniversary of the Effective Date, including after the Extension Notice , as
consideration for such Option. Such amounts shall be non-refundable.

 

3.                                      PROPERTY: 
That certain property on the West Bank of the Cuyahoga River in
Cleveland, Ohio forming part of the parking lot of the Nautica Entertainment
Complex (“Nautica”) comprised of approximately  28,646 s.f. land and
minor improvements thereon, if any,  and
which is Parcel #  003-19-018 of the Tax Maps for
Cuyahoga County, Ohio (“Property”). A map of the Property is attached as
Exhibit A.

 

4.                                      LEASE. 
The lease between the parties (“Lease”) shall reflect the terms of this
Agreement and be in substantially the same form as that attached as Exhibit
B.  The Lease shall be executed within
five (5) days following exercise of the Option as provided herein.

 

5.                                      DUE DILIGENCE:  Following execution of this Agreement, TENANT
will evaluate the Property. During such evaluation, TENANT shall conduct such
tests as it deems necessary in its sole discretion, including but not limited
to environmental and geotechnical tests and preparation of a survey and title
report. LANDLORD shall cooperate with TENANT during its evaluation, including
providing access to the Property, and provide to TENANT copies of existing
reports concerning the Property. The TENANT shall conduct its evaluation so as
not to impede or otherwise effect or inconvenience LANDLORD’S use or enjoyment
of the Property or any business conducted thereon.

 

1

 

6.                                      EXERCISE OF THE OPTION:  If TENANT decides to exercise the Option
granted herein, TENANT will notify the LANDLORD of its decision in writing
before the end of the Option Period and the parties shall proceed to Lease execution
as provided herein. The Option may be exercised at any time during the Option
Period, as extended. If the TENANT does not notify LANDLORD before the end of
the Option Period, then this Agreement shall expire and neither party shall
have any further liability hereunder.

 

7.                                      TENANT IMPROVEMENTS:  TENANT may, at TENANT’S expense, construct
one or more buildings and/or parking structures and other improvements on the
Property, as it deems desirable, subject to applicable building codes.  LANDLORD agrees to cooperate with TENANT in
obtaining necessary governmental approvals for the construction and operation
of such improvements and to execute such applications, consents, and estoppel
certificates as may be required by governmental authorities or TENANT’S
lenders.

 

8.                                      NOTICES: 
Any notice, request or demand required or permitted to be given pursuant
to this Agreement shall be in writing and shall be deemed sufficiently given
if, delivered by hand by messenger at the address of the intended recipient,
sent prepaid by Federal Express (or a comparable guaranteed overnight delivery
service), or deposited in the United States first class mail (registered or
certified, postage prepaid, with return receipt requested), addressed to the
intended recipient, at the intended recipient’s address set forth below, or at
such other address as the intended recipient may have specified by written
notice to the sender given in accordance with the requirements of this
Paragraph.  Any such notice, request or
demand so given shall be deemed given on the day it is delivered by messenger
at the specified address, or on the day of deposit in the United States Mail,
as the case may be.

 

	
   

  	
  For
  the LANDLORD:

  	
  Sycamore
  & Main, Inc.

  
	
   

  	
   

  	
  c/o
  Jacobs Investments Management Co., Inc.

  
	
   

  	
   

  	
  1231
  Main Avenue

  
	
   

  	
   

  	
  Cleveland,
  Ohio

  
	
   

  	
   

  	
  Attention:
  David C. Grunenwald,

  
	
   

  	
   

  	
  Vice-President of Development/Leasing

  
	
   

  	
   

  	
   

  
	
   

  	
  With
  a Copy to:

  	
  Stephen
  P. Owendoff, Esq.

  
	
   

  	
   

  	
  Hahn
  Loeser & Parks LLP

  
	
   

  	
   

  	
  200
  Public Square

  
	
   

  	
   

  	
  3300
  BP Tower

  
	
   

  	
   

  	
  Cleveland,
  Ohio  44114

  
	
   

  	
   

  	
   

  
	
   

  	
  For
  the TENANT:

  	
  Stephen
  A. Roark, CFO

  
	
   

  	
   

  	
  Jacobs
  Entertainment, Inc.

  
	
   

  	
   

  	
  17301
  West Colfax

  
	
   

  	
   

  	
  Golden,
  Colorado 80401

  

 

2

 

	
   

  	
  With
  a Copy to:

  	
  Samuel
  E. Wing, Esq.

  
	
   

  	
   

  	
  Jones
  & Keller

  
	
   

  	
   

  	
  1625
  Broadway, Suite 1600

  
	
   

  	
   

  	
  Denver,
  Colorado 80202

  

 

9.                                      CHOICE OF LAWS:  This Agreement shall be governed by and
construed under the laws of the State of Ohio without regard to conflict of
laws provisions.

 

10.                               AUTHORITY: 
Each party signing below warrants and represents that he or it has the authority to execute this Agreement.
This Agreement shall be binding on and inure to the benefit of each party’s successors and assigns.

 

11.                               LEASING COMMISSION:  The parties acknowledge that neither has been
represented by a real estate broker or other agent in this transaction and each
party agrees to defend and indemnify the other from and against any and all
claims of a third-party real estate broker or agent for commissions being made
though such party.

 

12.                               ASSIGNMENT. This Agreement may be assigned by
the PURCHASER to an entity in which it owns a controlling interest or to an
entity acquiring all or substantially all of the assets of the PURCHASER.

 

13.                               COUNTERPARTS. This Agreement may be executed
in one or more counterparts, together which constitute the Agreement.

 

14.                               ENTIRE AGREEMENT: This Agreement together
with the Purchase Agreement, contain the entire agreement between the parties
hereto relating to the Property and shall not be amended or modified unless set
forth in writing between the parties.

 

Agreed
and Accepted as of the Effective Date.

 

	
  TENANT:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Jacobs
  Entertainment, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Stephen R. Roark

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   Stephen R. Roark

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President/Chief Financial Officer

  
							

 

3

 

	
  LANDLORD:

  	
  Sycamore
  & Main, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ David C. Grunenwald

  
	
   

  	
   

  	
  David C. Grunenwald, Vice-President of

  
	
   

  	
   

  	
  Development/Leasing

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Patrick J. McKinley

  
	
   

  	
   

  	
  Patrick J. McKinley, Executive

  
	
   

  	
   

  	
  Vice-President

  
					

 

4

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