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Exhibit 10.103    
    

 
 

SECOND AMENDMENT TO AGREEMENT AND LEASE    
    

        This Amendment to an Agreement and Lease entered into this            day of March 1999 by and between the CITY OF
OSCEOLA (hereinafter referred to as
"City"), the OSCEOLA WATER WORKS BOARD OF TRUSTEES (hereinafter referred to as "Board"), and SOUTHERN IOWA GAMING COMPANY (hereinafter referred to as "Southern"), amends an Agreement and Lease dated
August 19, 1997, and amended March 17, 1998, as follows: 

	1.
	Paragraphs 6
and 7 of the amendment of March 17, 1998 is amended by adding a new paragraph 10(G):

	G.
	City
agrees that the highway and street improvements provided for herein are for the benefit of the City, Clarke County and the State of Iowa and as such, will become the property of
the City as to the city street improvements, Clarke County as to relocated 218th Street and the State as to the Interstate highway improvements, at such time as the improvements are
completed and accepted by the respective public highway jurisdictions. City agrees to apply for and receive Iowa sales tax refunds for the materials and services used for the highway and street
improvements on behalf of all of the public bodies. City agrees to remit said sales tax refunds to Southern Iowa Gaming within 5 days of receipt. That portion of sales tax refunds so remitted
that are applicable to costs associated with the Clay Street portion of the street project east of the interstate ramp terminal eastern most return, shall reduce the cost of the project to the city as
agreed to in paragraph 7 of the March 17, 1998 amendment. 

        IN
WITNESS WHEREOF, the parties have executed this Second Amendment to Agreement and Lease as of the date first above written. 

	
SOUTHERN IOWA GAMING COMPANY	
 	

 
	

By:	

/s/  WILLIAM M. GRACE      
	
 	

 
	Date:	3/8/98
	 	 
	
CITY OF OSCEOLA, IOWA	
 	

 
	

By:	

/s/  FRED DIEHL      
	
 	

 
	Its:	Mayor
	 	 
	Date:	3-11-99
	 	 
	
OSCEOLA WATER WORKS BOARD OF TRUSTEES	
 	

 
	

By:	

/s/ signature illegible
	
 	

 
	Its:	Water Board Chairman
	 	 
	Date:	3-11-99
	 	 

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Exhibit 10.103

SECOND AMENDMENT TO AGREEMENT AND LEASEQuickLinks
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Exhibit 10.104    
    

 
 

THIRD AMENDMENT TO AGREEMENT AND LEASE

        THIS THIRD AMENDMENT TO AGREEMENT AND LEASE (the "Amendment") is made and entered into effective as of
the                        day of
September 2004, by and among the CITY OF OSCEOLA, IOWA (the "City"), the OSCEOLA WATER WORKS BOARD OF
TRUSTEES (the "Board"), SOUTHERN IOWA GAMING CO. ("Southern"), and HERBST GAMING, INC. or
HGI-LAKESIDE, INC. ("Herbst"). 

        WHEREAS, the City, the Board and Southern are parties to a certain Agreement And Lease dated August 19, 1997 (as previously
amended, hereafter referred to as the "Lease"); and 

        WHEREAS, Southern assigned its interest in the Lease to Herbst, and the City and the Board are consenting to such assignment, upon the
terms and subject to the conditions set forth in a certain Agreement (the "Global Agreement") executed by the City, the Board, Clarke County Development Corporation, Southern and Herbst as of the date
hereof; and 

        WHEREAS, the Global Agreement requires that the parties amend the Lease as provided herein. 

        NOW THEREFORE, for good and valuable consideration, the parties hereby amend the Lease as follows: 

	1.
	Section 2(iii)
of the Lease is hereby amended by adding the following language:

	

	Such
right of first refusal shall continue in full force and effect until December 31, 2014, at which time it will automatically expire and become null and void.
Thereafter, the Board may lease all or any portion of said real estate, so long as such proposed lease does not compete with Herbst's excursion gambling boat operations.

	2.
	Section 2
of the Lease is hereby amended by adding the following new subsection:

	

	(v)
In consideration of the limitation placed on the right of first refusal in subsection (iii) above, the City waives any other existing statutory rights or
remedies as of the date hereof, including, without limitation, the existing statutorily prescribed admission fee allowed under Iowa Code § 99F.10(3).

	3.
	In
lieu of recording this document, the parties may record a memorandum of this Amendment, or of the entire Lease as amended hereby. All parties agree to execute such a memorandum in
recordable form upon the request of any other party hereto.

	4.
	Except
as amended hereby, the Lease remains in full force and effect upon the terms set forth therein. 

        IN WITNESS WHEREOF, the parties have duly executed this THIRD AMENDMENT TO AGREEMENT AND
LEASE as of the date first above written. 

	City of Osceola, Iowa	 	 	Osceola Water Works Board of Trustees
	

By:	
 	

/s/  FRED DIEHL      	

 	
 	

By:	
 	

/s/  SIGNATURE ILLEGIBLE      
	 	 	
	 	 	 	 	

	

Its:	
 	

Mayor of Osceola	

 	
 	

Its:	
 	

Chairman Water Board
	 	 	
	 	 	 	 	

	*
	The
signature above on behalf of the City of Osceola, Iowa and the Osceola Water Works Board of Trustees are subject to and conditioned upon formal approval by such parties' governing
bodies. 

 

	Southern Iowa Gaming Co.	 	 	 	 	 
	

By:	
 	

/s/  BRUCE SCHMITTER      	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Its:	
 	

Vice President	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 

2

 

	Herbst Gaming, Inc. / HGI-Lakeside, Inc.	 	 	 	 
	

By:	
 	

/s/  EDWARD HERBST      	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Its:	
 	

President	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 

3

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Exhibit 10.104

THIRD AMENDMENT TO AGREEMENT AND LEASEQuickLinks
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Exhibit 10.105    
    

 
 

AGREEMENT    
    

        THIS AGREEMENT is made and entered into effective as of the 30th day of September 2004, by and among
the CITY OF OSCEOLA, IOWA (the "City"), the OSCEOLA WATER WORKS BOARD OF TRUSTEES (the "Water Board"),  CLARKE COUNTY DEVELOPMENT
CORPORATION ("CCDC"), SOUTHERN IOWA GAMING CO. ("Southern Iowa") and HERBST GAMING, INC. or
HGI-LAKESIDE, INC. ("Herbst"). 

        WHEREAS, CCDC and Southern Iowa are parties to a certain Management and Operation Agreement dated July 15, 1997 (as previously
amended, hereafter referred to as the "Management Agreement"); and 

        WHEREAS, the City, the Water Board and Southern Iowa are parties to a certain Agreement and Lease dated August 19, 1997 (as
previously amended, hereafter referred to as the "Lease"); and 

        WHEREAS, Southern Iowa has agreed to sell its operating assets to Herbst, and in connection therewith, Southern Iowa and Herbst have
requested that CCDC, the City and the. Water Board consent to the assignment of the Management Agreement and the Lease by Southern Iowa to Herbst; and 

        WHEREAS, as a condition to such consents, CCDC, the City and the Water Board have required that Southern Iowa and Herbst enter into and
perform their respective obligations under this Agreement. 

        NOW THEREFORE, for good and valuable consideration, the parties hereby agree as follows: 

        1.    Initial Payment.    In consideration for the execution and delivery of this Agreement by CCDC, the City and the
Water Board, and as a condition precedent to such parties' obligations hereunder, and if, and only if, Herbst acquires the assets of Southern Iowa pursuant to the Asset Purchase and Sale Agreement
described below, Southern Iowa shall, immediately upon and subject to the later to occur of (a) approval by the Iowa Racing and Gaming Commission ("IRGC") of Herbst (or a Herbst affiliate) as
the operator of the excursion gambling boat known as Lakeside Casino Resort (the "Casino"), and (b) closing of the transactions contemplated by that certain Asset Purchase and Sale Agreement
dated July 20; 2004, between Southern Iowa and Herbst, pay the amount of Three Million Two Hundred Thousand Dollars ($3,200,000) (the "Initial Payment") to the City. CCDC, the City and the
Water Board agree that such amount shall be placed in an escrow fund under the jurisdiction of the City, and to otherwise be administered pursuant to that certain Joint Resolution dated
September 2, 2004 adopted by the City, CCDC and the Water Board (which resolution provides, among other things, that such funds shall be "distributed 100% for the purposes described in Iowa
Code 99B.7, Subsection 3, paragraph b"—i.e., educational, civic, public, charitable, patriotic or religious uses). The parties expressly agree that if Herbst does not acquire
the Casino for any reason, then the Initial Payment shall not be payable hereunder. 

        2.    Future Payments.    In addition to the Initial Payment described in Section 1 above, and commencing as of
the eighth anniversary of the Initial Payment. and continuing thereafter for so long as either the Management Agreement or the Lease remains in effect, Herbst shall pay to the City One
Percent (1%) of Herbst's (or Herbst's affiliates, if a Herbst affiliate is the operator of the Casino) annual adjusted gross receipts from the Casino, with the timing to be as provided for
payments to the Treasurer of the State of Iowa in Iowa Code Chapter 99F.11. CCDC, the City and the Water Board agree that such funds shall be placed in the escrow fund described in
Section 1 above, and shall otherwise be administered pursuant to that certain Joint Resolution dated September 2, 2004 adopted by the City, CCDC and the Water Board. 

        Notwithstanding
the preceding paragraph of this Section, the parties acknowledge and agree that Herbst shall be entitled to a credit of up to Fifty Percent (50%) of the amounts
otherwise payable under this Section 2 for any expenditures by Herbst (or Herbst's affiliates) for new capital 

 

improvements
made within Clarke County, Iowa for hotel expansion/renovation, marina improvement, lakeside development, recreational opportunities or other landside development following Herbst's (or
Herbst's affiliates) purchase of Southern Iowa's operating assets. Such capital improvements shall specifically exclude gaming devices/equipment, gaming facility or casino floor expansion or
renovation, development of a truck stop type facility, and any expenditures for general repairs or maintenance. These credits may begin accruing immediately upon IRGC's approval of Herbst (or a Herbst
affiliate) as the operator of the Casino and shall be usable for an indefinite time period. Additional credits shall continue to accrue as eligible capital expenditures are made as provided in this
paragraph. Herbst shall provide CCDC, the City and the Board with reasonable documentation verifying such expenditures on an annual basis. Upon request, CCDC, the City or the Water Board may audit
Herbst's (and Herbst's affiliates') records relating to such expenditures during normal business hours. 

        3.    Consent to Assignments.    Upon, and subject to, receipt of the Initial Payment described in Section 1
above and the execution of the Lease Amendment described in Section 7 below: (i) CCDC, the City and the Water Board shall be automatically deemed to have consented to the assignment of
the Management Agreement and the Lease by Southern Iowa to Herbst (or its affiliate); and (ii) CCDC, the City and the Water Board agree to execute such additional documents as may be reasonably
requested to confirm such consent. 

        4.    Scope.    CCDC, the City and the Water Board acknowledge and agree that the payments and performances required
of Southern Iowa and Herbst (or its affiliates) under this Agreement (and under the Management Agreement and the Lease) are in lieu of any other existing statutory rights or remedies as of the date
hereof. Such parties further covenant and agree that they are not currently seeking, and have no intention of seeking in the foreseeable future, any statutory change providing additional rights or
remedies with respect to the matters that are the subject of this Agreement. 

        5.    Cooperation.    CCDC, the City and the Water Board will cooperate with Southern Iowa and Herbst in the process
of transferring and assigning Southern Iowa's business assets to Herbst, provided that such parties are not required to expend any sums or incur any
liabilities in so cooperating. 

        6.    Non-Disparagement.    All parties to this Agreement agree that they shall not disparage any other
party to this Agreement. 

        7.    Lease Amendment.    Upon and subject to receipt of the Initial Payment described in Section 1 above, the
City, the Water Board, Southern Iowa, and Herbst shall enter into a Third Amendment To Agreement And Lease (the "Lease Amendment") in the form attached hereto as  EXHIBIT A, the execution and
delivery of which is a material inducement to the City and the Water Board to enter into this Agreement.
 

        8.    Interpretation.    The payments and performances described in this Agreement are in addition to, and not in lieu
of, the parties' respective rights, duties and obligations pursuant to the Management Agreement and the Lease. This Agreement and the Management Agreement and Lease represent the parties' entire
understanding with respect to the subject matter hereof. All other representations, promises and agreements relating to the subject matter hereof and not embodied herein or therein are superseded
hereby and are of no force or effect. This Agreement shall be binding upon the parties hereto and their successors and assigns. 

        9.    Agreement Conditioned Upon Herbst Acquisition of Casino.    Notwithstanding any other provision herein, the
parties hereto expressly understand and agree that this Agreement is conditioned upon and shall be effective only if Herbst acquired the Casino in accordance with the Asset Purchase and Sale
Agreement. If Herbst has not acquired the Casino pursuant to the Asset Purchase Agreement by June 30, 2005, or if the Asset Purchase and Sale Agreement is terminated prior to closing at any
time prior to that date, then this Agreement shall be void and of no further force and effect, the parties shall have no further rights or obligations hereunder, the Lease Amendment shall not be 

2

 

effective
and the Lease and the Management Agreement shall remain in full force and effect in their forms prior to the execution of this Agreement. 

        IN WITNESS WHEREOF, the parties hereto have duly executed this AGREEMENT as of the date
first above written. 

	City of Osceola, Iowa	 	 	Osceola Water Works Board of Trustees
	

By:	
 	

/s/  FRED DIEHL      	

 	
 	

By:	
 	

/s/  SIGNATURE ILLEGIBLE      
	 	 	
	 	 	 	 	

	

Its:	
 	

Mayor of Osceola	

 	
 	

Its:	
 	

Chairman Water Board
	 	 	
	 	 	 	 	

	

Clarke County Development Corporation
	

By:	
 	

/s/  SIGNATURE ILLEGIBLE      	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Its:	
 	

President	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Southern Iowa Gaming Co.
	

By:	
 	

/s/  BRUCE SCHMITTER      	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Its:	
 	

Vice President	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Herbst Gaming, Inc. / HGI-Lakeside, Inc.
	

By:	
 	

/s/  EDWARD HERBST      	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 
	

Its:	
 	

President	

 	
 	

 	
 	

 
	 	 	
	 	 	 	 	 

*
The signatures above on behalf of the City of Osceola, Iowa and the Osceola Water Works Board of Trustees are subject to and conditioned upon formal approval by such parties' governing bodies. 

3

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Exhibit 10.105

AGREEMENT

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