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Home My WebLink About2003-10-30 03-345 ORDEROYU5 p V AevB^edb Cowcila Bolren actb6ex 30. 2003 by CITY OF BANGOR (TITLE.) Order, Authorizing the City Manager to Execute a Development Agreement and Leases with Capital Seven, LLC. WHEREAS the City and Capital Seven have been In negotiations for some time regarding the re- development of harness raring fadift es at Bass Park; and WHEREAS, In June, the voters of the City of Bangor supported a local referendum to permit the location of video lottery terminals a[ a commercial harness racing track in Bangor; and WHEREAS, the redevelopment of Bass Park and the comtruNon and operation of gaming facilities in conjunction WM the harness racing track will provide for the future of harness racing in Bangor, produce a revenue stream W assist Me City in meeting its goal of replacing the Bangor Auditorium, and enhance economic activities in the Bangor Region; and WHEREAS, on October 15, 2003, the City Council approved a Letter of Intern with Capital Seven LLC catling the general terns and conditions to be included in a final development agreement and leases; and WHEREAS, a final development agreement and initial and final leases consistent with the approved Letter of Intent have now been negotiated between the parties. NOW, THEREFORE, BE IT ORDERED BY THE CRY COUNCIL OF THE CRY OF BANGOR THAT The City Manager is hereby authorized W execute a Development Agreement, Initial Lease, and Final Lease with Capital Seven, LLC for the redevelopment of harness all fadl'Nes and the development of gaming and related hospitality facilities located at Bass Park. These agreements shall be substantially in the form as attached hereto. I9-CITY COOgcn October 30, 2093 = Motion Made and Seconded for Passage -- Councilor Mealley Abstwfaed from Discussion and Vote due to a Previously Established Conflict. Ed Eeaxor, Representing Kehl wvageaent. urged City to ianelde[ Agreement: un ilCfur he cra Arae [ til further consideration creed be glum a proposal from his client. Om said. Kehl Important for felt it is lore all fax the `-C�ity to explore all optime and s1plM wait curie mita. Particle to Bran m➢ egreemevH uses,Partla BlawcClark ette.Thompson, onbn Emere. Ron Gillespie pion, Geoffxay , Bauick. gen dents,u sted Hall, he uger residents, g, give that the tion to give further table thisto m.Aer op[fms 6 table aria Hist. Yr en citrins, Bangor Council o ack,Cons sakes the Council [o c tai msa famSee to Capital Seven m aaneto make certain that the City taof u cepa other proposal. pa Para E Mersin Gefetm. Capital Seven. maivaabind that avoir proposals. is 6far Ram would be gage business for Kavgor and urgedfPas ara Motion for Passage I bsta Vote: 5 yea, 3 g y t abstaining EstCounates, voting yea: Lawley. Parahao, Yar[fag[m, Greene S Robson Councilors mbfng mm : Ala, Pal--rTtmble un Cociloa r abstaining: Meaney Passed 7 d 03-365 O RDRR (TITLE,) Authariaing the City Manager to Execute a Development Agxement am Leases with Capital Serve, LLC Assigned to Councilor 03-345 BANGOR RACEWAY LNVYUL LEASE A^^""IE T TILLS AG.RP hIENT, executed asoftheey of0mober, 2003, by and between'. TIM; CITY OF BANGOR a municipal corporation organized end existing under and by virtue of the laws of the State of Maine, and loafed a[ Batgor, Pawbscot Camay, Maine (hereinafter relented to as the "CITY') CAPITAL SEVEN,LLC, a Nevada limited liability company, having a place of business in Las Vegas, Nevada (hereinafter rdeared to as the "TENANT) WHEREAS, the CITY is the owner of hursss racing facility consisting of rete track, grandstand and stables (collectively the "Facility) located in the City ofBangor a the C1TY's Bass Park Complex; ant WHEREA& the City ant Me Tenant have this they entered into a Development Agreement (ft "DeveiopmeM Agreemem", the definmots of which are hereby incorporated herein by reference) with respect to the indication and development by the Tenant of portion of Me Bass Perk Complex including the Facility; and WHEREAS, this agreement ofleme ("faitial hese) is being executed pureness to the terms and conditions of Me Development Agembut mod is the agreement of lease referred to in the Development Agreement as the "Initial Lease". NOW, THEREFORE, the parties hereto agree as follows: 1. Fiction . The CITY, for andira coosidenausm ofthe rens to be paid still We obligations to be performed by the TENANT as bereimfier provided, does; hereby demise sad lease ever the TENANT not TENANT dam hereby take and hire from the City, upon and subject to the Term and conditions hereinafter Mean, in their present physical condition, and for Me Tem (aa deSnW), the premises and finalities totaled m Lae Crl 9 Baan Park Complex, including Me Facility and the trailer park, designated by eros; hatching in the sketch attached hereto a; "Exhibit l"(wVective7y the"Premises). TENANT has the option(wiL>hut any increase in recd) to iucrmse the Premises to include all or a portion ofthe Base Park Complex described in Exhibit B seemed hereto and made a part hismfto actommodes TENANT'S need for the permitted mess. 2. Licensee. Subject to the tema. toMilions and limitations with tea" to the utilization ofthe Premises by the City set forth in the Development Agrxroent (which provisions are incorporated herein by reference) ant the utilization by the Tenant of the remainder of the 03-345 Baas Park Complex, each of the Termed am the City does hereby grant a House to the other to use the following portions of the Bass Park Complex as berem below indicated'. a. Parking Arms. Parking areas will be avvlable for useby immeas sets h wnome Band ark Couples on Raano as well as customers of other events held at the Hees Park Complex on a first -coma fust -served basis. b. TrailerPark. The resile pukareaa will be available (ovasubordivate banufm use by individuals associated with home shows held in August and with hamess racing on priority basis. My unused space m the Trailer Park will be made available for shmtt use by others with the enema; fiam tbese uses to be collected and retained by the Cf . C. Track and^ The track and grandstand areas shall be available for use for other evens prim to the date of grandsmammtofthe mcingeabled The track end grandstand shallalsobe available any n the racing aerev on nag -racing days arx after racing on eery main, day where ruingismhedMedat end back shall he uclb shall bepermitted fhr mted provided that the track shall not be closed to horses tbrmme than thea days f he week from April 1st for n dere a thamm o days it 0ny weak season and Enron moredmn two days in any week during the racing ammo. ' d. Each of City and the Tenant hereby grant to the other a rig&ofpawage and mmment over its respective pordorm of the Bass Pok Complex for purposes of access arM ¢®mato the ¢mire Ham Park Complex. Without limiting the generality of the foregoing the CITY, its unpioyem agents, servants and invitees shall bave the right to amer endo the Premises m all reasonable moon with personnel, vehicles and equipment for the purpose ofmtimawvg, repairing and replacing the iManrunure, mllmes and appurresa d structures thereto. 3. (a) Term. TO HAVE AND TO HOLD the demised premises unto the TENANT for an annual term commenting October 1, 2W3 and ending September 30,200,t ("hritial Term), PRONrUDWFURTHER,muthehmm Tamshallnotcommenmwffirespecttothebuilding known m8am F located uBau Park until Much 1, 2W4. (b) The City does hereby give and grant umo the TemM the movocable right and entire (the "Option") to Wood the hii[ial Teras for an additional period of one year (commencing October 1, 2004 and ending September 30,1005); which extended peried shall be rationed to herein as the "Extended Team"; and the IMtial Tam and Exceeded Tenn shall be selectively referred to hereinmthe"Term". The Option may only be exercised (1) bywriRen tomes CIevercise Notice) transmitted by the Tenant to the City at leaat 45 days prior to the expiration of the Initial Term and (H) if on the but day of the initial Term there shall exist no material nuanced breach of this Initial Lease by the Tenant Within tea days of receipt of the Exercise Notice and within tea days prior m the expiration ofthe Initial Tenn the City shall advise the Tenant, in writing, as to the exinence (M the opinion of the City) of my material crested breach of Me lvitial lease by 03-365 the Tenant; and the Tamm, in each insmmq shall be eutaled to curethe same priorto the aspirates of the formal Team. 4 Bxlsfin¢Facfitles/Adduma;end Changes. No Mt rlatiorliviityorany improvementor physical changes to arty edsdng buildings or facilmes including the Facility may be constructed except in srordmce with the tams and conditions ofthe➢evelopmem Agreement nobler on an emergency basis for purposes of public safety and/or property preservation. itis understood and agreed that the CITY shall remain the legal owner of all buildings, structures, improvements, facilities and installations currently upon the premises or which may be erected by the City upon the Premises during the tam ofthis Agreement while noy new strumae seated by the Tenant shall be and remain the property of the Tenant. Equipment (othertlmn Gaming Machines and/or equipment related to the operation, maintenance and/or servicing of Gaming Machines, incuding without limitation, currevcy acting and counting machines and Mention facilities) owned and installed by TENANT shall become the property of the CITY where such aluipment becomes attached to and a fixed element ofarry building, numbers, or facility owand by the City. 5. Maintenanceend improvements. Subjecttothotammanlcons itmnsofthe Development Agreement (a) TENANT shill, m its sale cost, provide all necessary maintenance coal repair of the leased facilities, including the mointerence and repair neressary to keep the facilities in compliance with applicable face and life safety codes; and (h) TENANT shall maintain the facilities in accordance with that class standards computable to other facilities in Maine add New England. The CITY and its designated representatives shall have a right of access to inspect premises and ficilifics and to order tentative measures consistent with the foregoing FormdinspctiorsofthedemisedPremiwssballbeconducwdbythe CFrYonor about March ]A, during the weak prior tothe Bangor Sante Fair, during the weak afterthe Barger State Fah, during the weak after September racing, if applicable, and during rte first week alcovember of each year of the Tam. The purpose of from inspections is to memo that the facilities we mai assured in the same or better condition as existed at the start of the Agreement. In the evert TENANf faila to makerepain or m keep the facilityin a serf and savitar mndirimwhermboveprovided,C=stallhave Nerightwamenupmdmfakyfor purposesofmakingrepeusantwc gethecostofsuchrepabsm TENANT. 6, Annoyed Uxs. The primary use of am Premises will be for live bamcs racing and directly Mated activities and promotions including simulcasting and cortcers and the insmllnion and operation of Gaming Machines. Olhttfioree related everts wcM1 as Imine shows, sales, and demomtrations are permitted. TENANT shall haw the exclusive use of the premises for these uses during the Term, 7,JS]t11i i_g. All utility expenses mcludingwater, electrical, telephrnc, sewer and waste disposed, required to operate the premises, shall be paid by the TENANT (except an the extent any potion of such Premiere are utilized by or under the supervisim or control of the City, in which case each coeds shell be boom by the City without right ofmccuprmat from the Tenant). TENANT shall pay Cli fordI CITY -provided militiesatthe same mtesthe CITY almrges simian customers. The Glilerd T'ENio DecoBegreetoautiTheputeringand/ormst is W rut plan which will be implemented primto December r 2003. The des asee read plan is W Provide for a cost-effavve plan for eider separately metering the facilitieato be uaei for 03-365 racing or appropriately allocating mility costs based on mount use by the Tenam author otlmn, as the case may be - & Tana Liamses and Feu_ TENANT shall be responsible f am and ell taus and all required licenses and fees arising out of or relating to Tenant's utilization ofthe Premium, 9. (a) The TENANT shall indemnify, defend, and hold harmless the ©'IY from and against all claims and actions, and all expenses incidental to such claims or actions, based upon as mining out ofdaummto property or injuries to persons or other tortious alis caused or eoauibuted to by the TENANT or surface acting ands its direction or consul or in its behalf in the worse ofthe TENANT's activities muter this IMial Lease, provided that TENANT's aforesaid indemnity and hold hemde rs agreenmat shall not be applicable to any liability based upon the negligence and/or intentional misconduct ofthe CITY andlas others utilizing the Premises sellar portions thereof by license as hereinabove provide. (b) The TENANT hereby expressly agrees that it will defend, indemnify and hold the City ofBangor harmless from any and all claims made or amort¢ by TENANT's agents, swomms or employees arising our &TENANT's activities order this Initial Lean; provide however that Tenant's aforesaid indemnity and hold harmless agreement shall ort be applicable to any liability baud upon the negligence and/or instrument misconduct of the City and/or other utilizing the Premia¢send/orportona thermt'by licensor herrinebove przrvide Fortlespurpose, TENANT herebyrecww y, waivmanyand all Immunity it may hrveuvdm Maine's Worlws' Caopensation Am in regardto such claims made or asserts by TENANT's agms, scrvmns, or employees subject to the limitations hereinabove art froth. The indema iScatim provided color this paragraph shall extend to and include any and all cousts incurred by the CITY to avower, investigem, defend and settle all such claims, including but nm limited in the CITY's casts for atfomey foes, expert and other winsm foes, the cost ofinvearigaura, and payment in full ofany and all judgment rendered in livor of TENANT's agents, sehvents or employees against the CITY in regard to claims made unsure by such agents, servant, or amployces. (e) The MY shall indemnify, defend, and hold harmless the TENANT from and against all claims and actions, and at expenses incidental to such claims or serious, based upon or wising not of damage to property m i mies to actions or other nations acts caused or contributed to by the MY or anyone acting under its direction or normal or in its behalf in the course ofthe CITY'S activities under this Initial Lease and/or others utilizing the Premises and/or pentons shared transient tots license granted to the City, provided that CITY's aforesaid indemnity and hold harmless agreement shall ort be applicable to any liability baud upon the negligence and/or intentional misconduct ofthe TENANT or anyone acting under its direction or control or in its behalf in the course of the Turns's activities order this Initial Lean. (d) The MY hereby expressly agrees that it will defend, indemnify and hold the TENANT hmmless from any and all claims made or asserted by MY 'a agents, servants or employee; wising tart of CTY'3 activities under this Initial Lease; provided imnwer that CITY'S aforesaid indemnity and hold brimless agreement that not W applicable to any liability based open the negligence and/or imena mal misconduct of the TENANT or anyone acting under its diremim or control m in its beWm the course of the Tenam's activities under this Ldtud Lease. Fmthislmrpose. CTfYhacby expressly waives avY and all immuuityit may have under Maine's Washers' Compensation Act in regard to such claims made or asurted by MY's agars, servants, or employees ubjemto the limitations hereinabove set forth. The indertutBcation provided under this paragraph shall caused to and inodude any and all costs incurred by the TENANT to answer, investigate, defend and settle all such claims, including but not limited mthe Tllbl T's costs for attorneyfees, eapat and other winsm; fres, the con of . mvestigators, and payment in fall of any and all judgments rendered n fawr ofC1TY's agents, servants oremployees against the TENANT in regard to claims made or asserted by such agents, smarts, or employees. 10. Insurance, T' Te taut shelf prorride and maijamthefollow- Term. a. fn contentment crab the employmen of its employeey TENANT shat) pay all applicable social security, unemployment, workers' compensation, or other empbymemaws or contributions of insmance and shall complywhb all felled end stain laws sent regulations raatiogm employment geoedly and to wages, social seotity, unemployment entrance rance and workers' compematiw inpartcular. TENANT shah indemnify and hold harmless the CTTYfmm all costs. expenses, claims ordamageereireme from any bilure ofTENANTm comply with these requirements b. TENANT shall procma sod maintain comprehensive general liability and summ obile liability insmmwe on behalf of itself and the CITY (as Thar respective mteresss may appear) almost arty damage, loss or liability or claims alleged to have arisen from the use or occupancy by TENANT ofthe Pnaniaes. With male tin the tanned evide ing the ice Shan be paid directly by TIayV The amounts of each cremate shall be on less than as the follows. Twe I. wmlmn' Compensation $tanamyr Employers Debility 2. Liability Public Liabilityity to id to the but net be mtoric following SIM combined single limit SIM combined single limit whh additional umbrella policy for not Ien than $2M 03-345 03-345 d) produWwmplerM operations e) contractual liability 3. (Domprebaneve Automobile $1M combined single limit Liability coverage to include coverage for: a) ovmedheaeA aummobles b) voo-ownad mnomables c) hired cars 4. Snndud Porn Pve or Repiacemeot Value All Rink Inavaoce Policy (d) Should TENANT desire, CRY will cmanie a request the Pine or All Risk Insurance be provided by tM CITY and shall be paid, mm agreed pm-mA basis, by TENANT m thosepeofd which TENANTocmpies the Premises. Inthe eventof1msbythe em my portion onto Premises (otherlhm to new str dm% eannee 's are awned by the TENANT) doe m NANT'ae or u or arty as a during TENANT'ause o Namwy, or TENAcreating a&r nts, se and use or ebor easy as a reel, of TEN NT igenceofTENAN[ or Tw was r e agents, by rhes, coreruman lo employees, TENANT atoll to he Ci sett[ any mob lose was co tared by the negligence muPm mo the CF misconduct of the City, he agenn, servants, contractors, or employees, redone; cloth¢CITY is erremeofthe CRY'scon of replacing par asuce, the parligdufacilities comervd the is not reimbursed by applicable fire or all risk ivmsmnce. (e) Each wsurume policy procured by TENANT shall affirmatively some that it will nx be invalidated because the asured waived in rights ofroxwery, against my party prior to the occurrence of a loss. 11. Emlib a and Idemdea Cbebuton. TENANT and In employces shall operate as an independent contractor sad wither TENANT nor TENANT's employes shall be responsible xmemwr to he a empbons ire he CRY. The CRY shas rmrhe responsible for TENANT'S financialtobligationses won ulost not cetitedm,eelmim and wallet aeatrad memesy semmployces, prase distribution redprizescont dos and p corse of the rang meet, or amam[s due[o wdepenQ-art covVsaors.lwrstmen, vendors and purons. 12. Comvliavcewith Lmvs. TENANT will comptywith all federal, sate anal local stanks, rinse, ordinances ad regulations as they reale to the opeatlon of the m umaay and related facilities. 13. Nm-Dieviminavov. Is conducting moniria undefthis A®enmem, TENANT shall not discriminate too the baso of race, color, sew, creed, reigion, anceshy, national origin, age a disability, ora my alta mavar prohibited by law, and shall not fail or refuse to hire m employee or accord adverse, or unequal treernee many person or employee with respect to application, hhin& taioin& apprenticeship, caste, promotion, upg cling, compenseue, Iayolt discharge or any other tern or condition ofempbyment in any manner prolubited by law. 14. a 'og. Suje to the pmvisiom of the aA smrmce, TENANT shall have the exclusive right to sell alcoholic beverages on the Premises during the Term and shall have the 03-345 right to operate or let ed food and drink concessions arthe Premises The CITY reswves the right be provide these services sed concessions for any ever sponscrod or peradtax! by the =in its capacity as a Rceva of partner Mthe Tkemisce, as hem'uabove provned. TENANT may menace these rights directly or though an agcement with a reputable area concessionaire reasonably acceptable or the CITY. Is. Purchase of City ivvmnary TENANT shall purchase all marelmme,natrerials and supplies on hand and owned by the CITY m the than of the cesnmevmmwd of the Racing Season. Price will be based on actual CITY costs. 16. Performance Bond. TENANT' shall provide the CITY with a reasonably acceptable corporate surrey bond is the peon arm ofS30,000 payable to the CITY, or and oma security as is acceptable to the City Solicitor, fm to faifNul performance of all duties sad obligators imposed upon TENANT by and under the terms of this Initial tease. Bond or other acceptable security may be provided within tm (10) days ofaward amended racing coed license m TENANT by the bfeiae Harness Racing Commission for the Racing Season In addition to servingas a pergarmanm bond, this amount, if provided in m appropriate form acceptable to the Cay Solicitor, shall also fdfill the requirement colonel in Section M below for a Damage Deposit. Acceptable security may ratings nor brevocable letter of credit or a cash deposit. Said performance bond Shall remain in force, at a minimum, until 30 days following the BRprramrr Mthe TC[m. IT. Additioalftssponnabildre Cavme[m[vrth ronterms Mods initial Ieese, TENANT shall eeercise sound busimea4 judgmem, cooperate with the CITY, and be open m rhe CITY's and advice The CrlVs and TENANT's specific responbilities shall include, though tat recemseily be firmed m, the following: a. N ighb Mad Public Rdirman and Proration TENANT is mmd0il Mee impact of the operation of harness racing, concrete and (naming Machine artivitiea on to immediate neighborhood and surrounding mea. TBNANf agrees to adhere tothe following guidelines: i. No live ace Shall part aha 1 but net limited udcsa low of mfoer, los emergency rsuch as, "Predst not limited rd mss M Penner, loci ofcomplose arypar[m murine muted area, delayeityd sciderd.uch or lose stoves, MIf unbulance support,locoare delayed. fir arhepost staas an to operathall ing at effortro accelerate no cams and m finish opemtng a[ a reasonable hour, in ro case lazermm 12 midnight. it TENANf, in conducting MINA sactiviria under titer haml flies, soaR take raceseary ma,�s ter prevem gmeraton noise shall mean noise fav Fm,tppitch tcoPCOTSCSYneMxcy W la dibthece=foJinry ae ssivpe sof edeWiamptins n&gheHaParkComimfoam e ra eriodotlma EAWshall reasonably anticipated tor dimsmthe traace of ordinary comments omntsof residential armnMiog the Ba park Complex: and shall coopeme with CITY ®dmae the disavtwunce he arn/or the impact thereof 03-345 iii To W best ofiss ability, TENANT shall ensue that bone tr,as and facility traffic will comply with au applicable CITY rules and mgmaoom. b. Pest Covtrol. TENANT shall be repressible or all cecesmry pest covtrol services. TENANT and the CITY may mentally agree to a proration ofammal Pest control services. C. SnowEemoeal The MY shall be responsible for avow removal services. d Tmahlaemovav TENANT sbaludeng rmovalleforall vie of hash removal devices, tthat iag removal anddisposal ofmnumeprovidedd(icludingttheons in In capaetyas aliytoin ere such) shall be ble for erg persons $cling tl generated inconnection in a tion vat as then) shill be ror a poibkfmthe removal asheragmastedinided uwith their use of all or a pottionofWe Premises ere heseivabvve provided e. 'atiwvseeavd Pemid. TENANT shalo NANTdmaiman all operesendpsmhsee wady for TENANfmmange and apemmhe businesses. f Fixed Asset lnvenmry TENANT shell take custody but Trot owtmrship of the fixed Tssds of dw Premises at the commelrement of the Tam. The CITY shill provide TENANT by December 1, 2003 with a Poll and complete conned inventory ofstmcmres, fadlrtiek and improvem ems within the Premises. TENANT shall accept this fixed asset mventa y end may request a physical walk through and verification with a designated represenative ofthe MY. Proper common; of my discrepancies shall be made and initiated by both partes on the wrihen mare wary. During then period ofuse, TENANT $hall assume all maintenance and repair wars on such equipment. g. limas (]mine. The (TTY vvill be responsible for all gross cuff g thrmrgMut the promises. 18. he Facility and any nbwJt ivsweilurs constructed yes Taiern(cmall creme held ,the AacilTEand Toybuildingw,monopsconsmmth tby the Taunt ms ofthat "Tenant Smmmres �. TENANT shall lanfor,incooperdind theTeent StrufPdiw pl sW or Police Depmtmem,asas plan for rheAmiihyandthe Tenant mformtec. This pmn .shall outline the hvei arW type ofaamitymbe provided during acing. Uniformed poBce process shall be isattwdmce atalintact actuary pl evmu. Themwbvofuoifmmed poocem be protest shall be established m tmjoim security plan (b) In addition, the CbiefpfPace of the Banger Police Department may, at Ids damnation, require TENANT on provide a higher level ofumfmmed police, be prevent a the Faalitydoing Bacivg Ses morder,presaveard protecthvesarilproperty. Inthe even tofadispmebdwmftTENANTandM ChiefofPmicetegw4d gthenumbse uniformed ponce �'icas requ'ved, the diaprde shall be submitted to the City Manager ofthe City ofBangorvdamedderwo,on sball be find. 03-345 (c) Uniformed police seawity, may be supplememed by using laced coined security, TENANT's own atrocity employees, or other sources ofsxurity service. The Chief of Police of the City ofBaogor shall retain is authority to direct TENANT to remove from this responsi- buhtyaoyindividual engaged inproviding security services for any reason. The required security plans shall be developed and approved by TENANT and the CFFY within sixty (d0) days of the dine ofthis Initial Lease; and in the even such plan shall tot, within such period, his developed sad approved, the plan developed and approved for use during 2003 shall remain in fdlfarceavdeffasuoriimpmceded. TFNANTshadpaytheCTTYforuseafuoifrom Nhm odcem at the serve rem esablished by the CITY for such services provided be enter parries. 19. FireProtection TENANT shall abide by all fife safety and fire codes established by the Sete of Maine and the CITY as interpreted and cnkrced by the Code Enfincemma OB-iar of the City of Better or the Some F Marsbal's Office, 20. Paymentmtte Crtv. (a)TENAN'F that pay the CITY as reatfirc the Promises base fee ('Base Fedj in the amoust of Thirty-five Thousand Dollars ($35,000.00) for the Premises. meddirioomthe Fee,TENANTshallpaymtheC maddltloetel&e ("AddbiomlFee')msde[emtinedasfolmws: R'the sum oftheaverage daily handles both ors. rmck and at Mame Off Tmck Broting facilities wagered on TENANT'S races is tooder rim Fifty Thousmd Dollara($50,000.00Z the petceomge amoum bywldch said someone exceeds 550,000.00 shall be multiplied by the Base Feeto determine the ammo[ of the Additional Fee. CR'Y shell invoice TENANT the furl common of the Base Fee on Novemsr 19 of each year of this Agreement TENANT shall pay the feels) in seveo(7) equal monthly installments begianinRNovembalst Ary AdditiaWFasduewi06eca1cumtMmrhemdoft Racing Swsonambepaysbleby Sepembufs Sindbrly,a Addifin Feepayablewithrespatm racingduringthe Ext Termsillbealcubledattheendofthe2005ratingseasonandbe palableby September],2005. Attheendofm monadowgwhichlivetacesareconduced mthe Premimsbythe Tewin,TENANTshallprovidem C1 copiesofrepoasregm'nedms filed withthe Sete aFMaicereftxaing all wagers placed or made sadic Premises, aswell as all wegem made orpbced at Maine Off TmckBming farildics aromas coaAmreil Arae Premises. (b)lfpriorm Meexpimtionof[ Tam,0m Teoamoccupiesrhe Prrmrsespm mt units and cooditionsofthe Final LeasethanandinthateV :(Mlle Telcoshag IXp ua6eandmf the month doing wbichocaupmcy bythe Tenant shalt commence piammrcm rhe Firul Lease and OD within our year following the covmsmcement ofthe Temm'atermucypureuantmthe Final l avothe Terant shall pay to the City the Rad DBenscrial(asdeflu ed), Forpurposesof Final Bas Leine the terms (A) `Rem a sum of the scall ll teed ham ethe excess, Final oars Ficin Bate Renal (es defined) ova ee sum efts Actual Rem (as n ensu a); (eq "Foal Base Ramal'¢hall, andmemissum d] Les ie by by multiplying f i amcalendar melth ]during 112a of rhe Base Rent nt dtlined in the Final Lease by (a) the moiber offim etegaid R doing which the Teton has amount of Ba is Premises user the Fees al lease; ate (c) he Teri Rem'shell be ate mem the temoum ofSase Fees mm Addirioval Fein ecmegy pvd by the Tment in the City under the rmriil Lease. 21. Other Payments. (A) TS Leasee shall pay to the City, apuntive of the Grams Sket Revewe actually received by the Leasee ('T•mcenege Reef') during is Tam (sec defined) de[wrvived as follows: 3% of the fart $50,000.000 of Grose Slot Bewmsas actually received by the Lessee dmingts Term; 4% of Gross Slot Revenues between $50,000,001 and $70,M NO 03-345 . 'actually received by dm Lessee during she Term; S% of Green Slot Revermes bMwaen $'/0,000,001 and $100,000,000 actually received by the Lease during she Term; and 61A of Gross Slot Seamen in eacess ofSIW,000,000 sanely, received by the Lessee during the Term Payment of the Percentage Rem with respect to cath Arai Period shall be paid athe times and It the marmer em Ruth in (B) hereof. (R) Whin 30 days following the end ofeacb of the calendar mosses commentitrg during the Term, theaeee shall pay in the City that portion of the PerwNage Rens, if may, determined as fo0ows: frac, the Gone Slot Rename received by the[aasce during the period commendog on the fast day of the Term and succeeding on the Ind day of the subject month shall be determined(fe'Q imive Reason Amoma^);second, the amount of the Percentage Rem payable with respect in the Cbmuladve Revenue America shall be detemdned in scmrdown with the prooswvs of subparagraph (A) hemosthhe "Comm mw Percent Rest'); third, au payments ofPercentage Rem made by the Lessee during fc Term shall be aggregated ("Cumdative Payments To Dare"); and fourth, the excess, if my, ofthe Qrrwlarive Percentage Rent over the Cumuatiw Payments To Date shall be paid m the City M. Damare Deoostt Welds two(2) weeks tollowmg the CrNa annual pre -race inspection of the premises (.e, the inspection which ism near on or am March Id 2004), TENANT slash deposit with the CITY the sam of Ten Thousand Dollars ($IO,000D0)to be hdd by the CITY as a deposit against the MY's cot of repairing any unrepaired damage athe promises caused by the TENANT, im employees, horsemeq vendors, harness racing Persons, or others using thepremisa during the Racing Sam. Pollowing rho conrhsfnofebe Rarmg SeaoeandPriw minedamofagraphigoriafipave the CITYslashalsong my inspections o[ d Premisse Pdvkfdfpaagmpb5abovefrthe Propose. Tfiendfytngmyumidc damaged the Prrmisa of such bass TENANT'S sae ageof: The CtTYahallatedby TENANT with a Gmofas cath elms ofsrmepaved damage, white (3) da s ofthd by TENANT prior tithedartofthe Bangor Stale Pair,d by Ey AN days Wien CITY'S noticed TENANT.asthefd hi direct. repespoused by Tapply wee 'such sdmecso4 Ibe CTTY may mpa'vwwuseamh edam to orepaired,and maya, TENANT shall damage depot Awdswffici hatpurpose. Asewnddepn thiel. MT=TANTdml ollarstwif the CITY fiordsmuddedto rnofw bedamagedepodramountmTen Thowmd Dollars ($10,000.00). Upon msesby the To Term othmfm s areark ofthe wvmiwingis air om:upaneyofthe Promises by the oeonMbydinefinal Lease,and RRowf mdeofsl nrlarris eddamNemelm Premissocaaiall b by TENANT'e uTENA T. theonexpeedM balaarz ofTENANT's damage deposit smllberefeded to the TENANT. Upon espuatimM the TeFijW arevdt euw commencement ofoauPa s d of the Premises by the Teoavt pmsuam mem Pial Lau the uopuasn d h belanceuded a pa damage deposit seal o refunded d Termabove) Said damagedepoem whethuces. aurum tofdm Performance Bovd(Paragraph expansion above) m oferwise, shall remail w free, m amivmum, until 30 days fohowfg the expiarim often Term 23, Advertisine. TENANT shill have the right to solicit and duphy odhot bug within and around the grandsmnd on the manna shadow fence and d any location which Gaming Macdms of hvaa0ed d the Cooing. naturally adopg mons 4 my Jct tbe Advertising Policy ofthe Eangor City Carrel smmeoOY adop[edw as d may, from time to lime be amended. M Evart Sim C sbdl provide TENANT wifthe rigMmplaneanevem sign adjacent mthe Bass Perk pmpetymahoatiovmamally acceptabled Cn Yand TENANT. In 10 03-345 addition. CITY shit make space available mthe Base Park aghtd marquee sigo located on Maio Street whevaa possible. 15. Destro tins d'or MIajm l2evavnmthe Praniaes. Ifdusivgthe Tam(a)amataial portonof dw Facilityand/m a awerialpordon oftbe portion ofthe Premises inwhich Camivg Mmhivea have been installed shall be destroyed by &a, explosion or other castulty, orbemnse ofnormal wear and tear sone cannot be safely operated, and (b)the CITY or TENANT fails commence mrebuild, repro and reopen the same for business within sixty (60) days after the happening of send event, then either party shall have the right (but not obligation) to [aminate this Agreement. Aa prooeds ofinmmnce resulting from any such event shall be paid ova to the party uMertakivg arch repairs and utilized by such party rebuild or repair the Premises. 26. Taxa. Subject Maud in accordance with the provisions ofthe Development Agreement, the TENANT ages to pay, when due, any and a0 taxes and/or saaessmenn, fees or charges ofmy kind whatwever, as may be imposed during the Team by any govervmemal authority upon the Premises ad my other portion athe Bass Park Complex at which Gaming Machisre we msmlld sad opaoed by the Teoarq inchWing Lessee's leasehold inherent therein, my ed that ea mumprovemems thereon. m machete 0 l propesty vied as reaelev h is expressly agreed Chetsure ilea and norma shall insideallamounts Laid s real severe foxy Bryon thedemisdprentisesbythe l.essur acting ivasgoveromenmlt TENyandsbaa beconfutedlo mcordmce steels the provniova of the Development Agreement. 'IENANTfiuther hereby waivesmyadellrightscrst thermos atmsmylnfrom rrftucft the demisd Premise,cc TENANT'S perstinal �id varel Ned th re maty g due top public m impfof themems [Lawn. est prmses by the Cpropety, ,Prrided, adsivg,Dmpublicen salt in mywdprohi premises from CityofBangm; Ihovldd, however, eotldng barren shall in mywayes, the TENANT from aerdlve rt righnurderdm law m earnest the amounts of such taxes aeseslnenm, nbaBeamfres 27. Temwatim adnefaWt. If TENANT(a)fidampayotdepositsumsdtrewit seven (T days following written demand therefaretranonitted by the Cimto the Tempt or(b) a W cure the seine), the CITY may upon exphadm of such period, as the case may bq motivate this Initial Lege; provided however that ifths Teravt mmela the aomracv ofaner such entice cooVoversy shall be submitted to arbitration Warner to the Provisions ofPaeagaph 36 here rt and (d)the Tem of the brand lease shatt mvtime in full force and effect (whhout shat®em m The obligation to pay ren)unless and mtitterminaved by the award of the arbitrsmrs. Upon remivllon of the buttal lease the Truant shall have the seine To" and obligations with respect m Tarin Structures as it has reeler the Final Lease, 28. Noknra Venture. Nothiogcomaindberem"lbedeemodormvlrudbythe parties, nor by my third petty, ea aea[ivg am relationship ofprindpal sed agent m of partnership orjoint vevdaebetwew thepoties, it being to dentmd aed aged that neither the mcrlmd ofcoaWuteaoe of rem nor mry othaproxdslon normy otlrer sets oftla partes shall be deernd m sere myrelationehip baweev drepotiea attar than that oflamamd and herarn, 11 03-345 29. Noo-Waiver.'I'befailure of either patty at my tlmeto enforce a provision&this Irdtial ].ease Shan in no Way cunatitme awaiver afthe provision, mr in my way affim the valid'uy ofthis Initial Leaseorany pari threeK tithe right of such patty thereof an enforce each and every prowsten hereof. 30. AmaWmeoL The parties may ami this Initial Lease ordy by written agreement exeaaad by the parties. 31. No Aseiunmem. TENANT sbal] not assign, sublet, sen, transfer, or otherwise dispose ofim reborn in this butitl Lease without the prior written approval ofthe QTY,except W Bangor eparde Travis four. t provided shall ebaforementioned Development Agrceman betweenthe patten. This lnrtial L peenbe binding upon and ivweto The bercefit oftbe parties heron, tXeir mccessom and PemWSN esnigax 32. Severability. Atryprovlsl athu Agreemendecl mvelidbyacourtof competent jurisdiction shag east invalidate the remandng provisionsofthis Agreement: 33. Gose inn]aw. ibis Agreememsballbegovamdexclmivelybythaprovisiom hmofand by the laws ofthe Som Mrdnlm, as the same may Ham ume wtime wise. No suit shall be brought by either party to enforce any of the temes or provisions of this; Agreement, unless brought in the Penobscot County, Maine Distritt or Superior Count or the Fedael Courts havinjurisdietion and/or sitting in the Store of Mame. 34. Kutner All nouns acquired by this Agreement shall be in writing and shall be sufficiently, ®ven ami sated upon the other party either hand delivered a Son by regisrmd or ceen6ed United Staten mad, Postage prepaid, or overnight delivery service and addressed as foMws: Maestro= Edward A Bauu, City Manager _ City0filavgor 73 Barlow Street Bangor, Me 04401 or m Sash other place as the ClYy may, from time rooms, desigame by notice to TENANT. Ifamtto TENANT: Capital Seven, LLC -' 1055 E: Tropicana Aveme Suite 700 -._.:.. Las Vegas, Nevada Sol 19 ..... _. Withacopyto Martin 1. thrown, Esq. Freedmen @ Gerson, ISP 90Birch Mi Road Newtown, Ct 064x1 or a such other place as TENANT may, from time on tree, designate tothe MY, 35. Ivteoation Tbisinitial Legeandallappendicesandamendme haremmrdthe Development Agremmum embody the mire agreement of the parries relating mtbe duties and 12 O3-345 obligations required hereunder. There are no Promise; terve, condmons or obhgabons other than those commned herein and the BevelopmeiLL Agrvemera, and this Initial Lease shall Asperse. de atl previous mmmunicamns, rcpreaemations or ag.mmew, either oral or wriven, between the parties beano. 36. A brmion Any aM all disputes and comrnversies small outofor reimivg m His IT" Lease and/or the Development Agament shall be submi ted to and sWJW by adsdraWn w be heW in the City of BaAgor, State ofMaine is accordmce with the rales and regulations of the American ArbhmGon Association thea obtaining. Such arbitration shall be held before three mbinamts; one ofwhom shall be"Rotted by the City; one ofwhom shall be de paced by the Tenaat and one ofwhom shall be desippated by the other two arbitrators. The derision of majority of the mbimom shall be binding; any award may include me reimbursement m ehbm party of SEA& coaas and expenses incutttd'm connection with Much arbitration; and such award may be enforced on my court ofcompeant Pnisdiciim, IN WITNESS �F, the Portia have respectively executed or caused this Agreement m be executed The day mod year fust written above. WITNESS: CAPITAL SE{rlBd, LLC (BY) SMadn TNe: MMNAW PINOBSCOT, ss Omben,,91 M03 Then, pemomlly appeared the abo named Fdwmd A. Barren, City Manager of the City aBaagm, and aclmowledged the finegoing instrument m be Ns five as and deed in bis said capacay, and the flee act and deed of said body corIxNnm. Before nu% /�r?ntt` L G'etr�i Nofmy PubBci-A6ermr TENRI L COREY 13 NOTARY NEW,, MAINE YY COMMISSION seNRES DECEMBER II, ANY STATH.OH-)♦gNall It il-hewnIUlm .as ocarso L,Dtm i Tbmparsonally appeared the above -nand Shawn Sena, A1FtM of Caphai Sevev, ILC, and arlaeowldged the foregoing iosuiment w be We Gee act and deed in his said capacity, and the See act and deed of said body corporate. ' Heforeme, � n a4}iNOTgq}: Veli Kuang 9 111Expiration pate. June 3.2005 a 0...flaftIlInO y. .. 03-345 DEV PMENTAGREEMENT DEVELOPMENT OF A PORTION OF BASS PARR This Agreement is made and entered into as of October L, 2003 by and between the City of Bangor (hareinafter "City"), a municipal corporation located in Bangor, Coumy of Penobscot, Slide of Maine, and Capital Seven, LLC (herehiafier "Developer"), a Nevada limited liability company, with a place ofbusims in Las Vegas, State of Nevada. WITNESSETH WHFBFAc, the City has received the Developer's proposal for the development and/or renovation of poraon of the real property krmwv as Bass Park, located at Dutton Street in Bangor Maine, as described on Exhibit "A" annexed hereto and made a part hereof(hereinafter "the Premises'): and WJIEREAS, the City has determined that private development mWor renovation of the Premises in accordance with the provisions of this agreement (the "Development Agreement") would best serve the interests of the citizens of Bangor, and WHEREAS, the City has determined that the Developer's proposal mall serve the students of the citizens of Bargain, NOW, THEREFORE, IN CONSMERATION of the premises ant the tends, coveriada, conditions and muwal prmnius contained in this Developmem Agreemem, the City and Developer agree as follows: 1. COMMONSPRECEDENT: Except as expressly provided heron to the comrary, the performance by the parties hereto of their respective duties and obfigations pursuant to this Development Agreement and the Leases has defined) and the enjoyment by the parties hereto of their respective rights and benefits under this Development Agreement and the leases (as defined) are subject to the safisfaction (and/or joint wiitten waiver by the patties hereto) ofthe following conditions preceded: (a) The aterdse by the Developer ofits option to acgniing a controlling interest in Bangor Historic Track, Inc. ("BHT) by January 1, 2(XA, (b) Tice assumption by BHT of the obligations of the Developer, as developer, under this Development Agreement and the tenant under the Leases (as defn d) by January 30,2W4, and Page 1 of 10 ! 03-345 (c) the issuance by the Maine Harness Racing Cmmmasicn(the to BHT of five wing track ficense (including the assignment ofmcing days) with respect to the 20M racing season (the "Racing Seasod) proposed by BUT N the Bangor Historic Track (the "Track') m lata than 90 days prior to the commencement of the Racing Season. 2 PREFESES' ThePremisesshaftbeaportionofBass Parkin Boger,Main whichparcelshallbeas described in Exhibit A, and as more particularly described, respectively, in the Leases (a-, defined) to be executed by and between the parties simultaneously with the execution of this Development Agreement In the event of a" discrepancy and/or inconsistency between Exhibit"A"and the descriptions set forth in the Losses nas defined) respectively the descriptions see forth respectively in the Leases (as defined) shell be innumerous and prevaiL (a) Developct's Cotnmimnm: SubjecttotlmteursamlcoMitionsofthis Development Agreement and the Causes (as defined), including without limitation the receipt by the Developer add Developncnt Permits (as defined) the Developer shall' (I) implement the Development Plan (as defined) m the promises in Bangor Maine, in accordance with the [ages and conditions of this Development Agreement and the l.eascs (as defined) and (B) within 45 days after the effative dome of legislation permitting the instillation and operation aFGaming Madlmes (s5 defined) a the Premises, apply for and thereafter diligently prosecute applications for all Gaming Permit (as defined) required in order for the Developer to install and operate at the Premises 1,000 Gaming Machines (as defined)or the maximum poteitted by State how. For purposes of this DevNopmmt Agreement the terms: (A) "Development Phm" shell be and mon the plan for the improvement analog renovation of the Pre 'ses as described on Exhibit "B" ammexed hereto andmade a part hercQ (B) "Den ]Wp t Permits" shall be and mean all ofthe construction, use and occupancy portrays requhed m correction with the construction, occupancy and use of the structures; smaller impmvemems described in the DevNopmernt Phm including without Irritation any facility renovated od/or constructed fm the operation of Gaming Machines (m dewed). (C)"Gaming Machin&'sgdI be and mon video lottery terminals and/or slot machines; (D) "Track" abut be aM mean a race track at which Eve bane mons are conducted; sed (E)"Baciam"shall be and mean a facility adjecem and/or footing a pat of a Track add constructed and/or utilized for the operation ofGaning Machin a; (b) Phases ofDevelvoment: The Development Plan shag consist of and be implane ted in taro (2) phases (hereinafter "Phase f' and "Phase H") as described in Paragraphs 4 and 5 hereof (c) Lis Simultaneously with the execution hereof the City, as lessor, and the Developer, as lessee, are executing two lasses of the Premises (including all improvements Page 2 of 10 'thercon and/or theramder situated except as therein expressly provided to the contrary) captioned respectively the "Initial Kase" and the "Final Lease", copies of which are summand hereto and Isheled Extubits "C" and "D' respectively, and referred to herein collectively as the "Leann" 4. PHASE I OF TH6DEV OPMEN'I'PLAN (a) Phasel OblieationsoftbeDeveloper: Subject to the provisions of sabpardgrapbs 3(a) and 4(a)(III) and (IV) hereof, during Phan I in defined) the Developer shall: (1) make improvanents to the premises that shall consist of cosmetic improvements to fle existing one, half mile racetrack and renovations to the nabbing grandstand, racing support facilities and stables to address deferred insemination, safety and appearance (collectively six' Phase I Improvernents'%and (2) develop a detailed master plan ('Phase B Master Plan") for the implementation of that portion ofthe Development Plan to be implemented during Phase B(n defined). In furtherance and not in limitation ofthe farcgoivg: (1) Developer shall expend a terrarium of $100,000 for the Phase hnprovementa and the Phase D MasterPlan, in the aggregate. Developer MW provide the City with reasonable documentary evidence of all expenditures made by or on behalf of the Developer for both the Phase I Improvements and the Phase B Master Plan. (E) Developer and the City shall jointly maintain and utilize the existing parking in Baca Park during the term ofthe Initial Lease. Parking shall be used Party by the Developer and the City in support of their respective operations at Bass Park. A reasonable amount ofperking shell be reserved for the Developer's pahons during the State Fair. (DT) All condounion plans, specifications and designs for the PhaseI Improvements shall be approved by the City's Business and Ecotwmic Development Committee prior to the commrncement of any renovations; which approvals shall not be unreasonably withheld or delayed and shall be predicated upon the Cade ofthe City of Bangor. (IV) The Developershallworkwiththe Cityin the development ofthe Phasell MasterPlan; which masts plan shall (A) identify land uses and dens lies, (B) provide preliminary detail for Phase B improvements es described below, (C) design stormwater retention ponds or underground storage facilities to contain stonvwater mnofl, end (D) identify and address any changes to or affects upon the existing combined sewer stormwater overflow prying (CSO) located beneath the a Foram ofthe ground of the Promises and man Timeline For proposes nthis Development Agreernem the tem core of shillbeand meantheperiodcommencing ththedatehercofandterminatingmtheclose th basions on the day immediately preceding the commencement ofhamess horse racing at the Page 3 of 10 03-345 Track in 2004. Subject to the provisions of subparagraphs 3(a) and 4(a)(M) ard(IV) hernQ the Developer shall complete the Phase I Improvements and the Phase II Master Plan prior to the expnsion of Phase t. (c) Phase I Oblimtions Of City During Phase I the City shall on a timely basis: (1) assist the Developer in securing, an a timely basis, any and At Development Permits required in connection with the Phase I Mprovmments (m cooperate and assist the Developer in the development of the Phase IT Master Pleat and (/m cause its Business and Economic Development Committee to review and under its decisions and/or approval of construction plans specifications and designs for the Phan I Improvements on timely basis. (a) Phase U Oblintioan ofthe I&Aoott: Subjeclto the provisions of subparagraphs 3(a) and 5(b) heawt during Phase U (as defined) the Developer shall welermke expenditures of $30,000,000 for capital improvements to, m or under the promises including, without limitation the construction of. (I) a gaming and conference center space sized to meet market demand, with the commerce Omer Turn, tobe based on the space recommendation included in the CS study fora cew conference eater (20,000 square feet of multipurpose space with 7,500 square we of breakout space), (I) a four star 100 suite hotel (subject to the provisions ofsubparagrapbs 5(a)(Mreal (l) hereaQ,(" surface or structured parking as required by City zoning requirements to mraxamer daze the other Phase U Improvements and (Il) a collapsible open air stage to be utilized at the Track (collectively the "Phare D Improvements"); provided however that anything in this Development Agreement to the contrary arotwithstanding, the Developer shall not be required to commence and/or complete construction of the Phase IT Imprwemmts unless and until both ofthefeffowing condi ions have been satisfied: M the Wohope'shall have recerved all pemnts approvals and emu mens (collectively "Gaming Parrots") to operate 1,000 Gaming Machives (or the maximum permitted by State law); end (") the Developer shall have commenced commercial operations ofGanting Mshines at the Premises. In furtherance and not in limitation oftletforegoing: (1) Construction oftemoomry gaming mmovw S: Developer shall commence construction at the Premises of temporary gaming improvemenrs, no later than sixty (60) days after receiving all Gaming Permian to operate 1,000 (or the ma ♦mum permitted by Some law) Gaming Machines and all Development Panama required to construct, rmovam or improve any f e ity for the operation of Gaming Machines s the Premises. (U) Connotation of permanent wrote faciity and conference centeo Developer shall use its best efforts in good faith to commence construction of permanent gaming facility and conference caller (at the respective areas indicated on the Phase D Master Plan) by August 1, 2004 and to complete construction by June 30, 2005. (III) Contraction of hotel; Developer shall use Its best efforts in good faith to commence construction ofa 100 suite hotel (al the area indicated on the Phase II Master Plan) within one(t)yes ofthe coamSwion of the first calendar year during which Gaming M Iurms Page 4 of 10 operated by the Developer at the Premises generate $60 million in arcual Gross Slot Revenue (a defined) based on a calendar year. "Goss Slot Revewe" is defined u money or credits wanted into a gaming machine minus money or credits or prizes paid not to winner. (M Failure to commence construction of hood, If (A), upon timely application by the Developer, all of the Development Panama shell have berm fully and timely named with respect in Ne hotel, and (B) the Developer shill not have commenced connotation of the hotel within the fust to occur of(y) the expiration of the third year of occupancy by the Developer of the Premises under the Fired Lease or (z) the expiration afoot year of the conclusion of the first calendar year during which Gaming Machines operated by the Developer at the Premises generate $60 million in arcual Groa Slot Revenue based on a calendar year, then that portion of the Premises designated on the Phase H Master Plan for contraction of the hotel (the "Hotel Property) may, at the City's option, be removed from the Final Lane, with a proportionate reduction in Base Reran, as provided in said lege. The City may exercise its option upon 30 days prior written amice to the Developer during which period cure shall be permitted. If the Hotel Property is removed from the Find Le as e, the City shall make all good faith efforts to lease or sell the Hold Property for the development of hotel by an independent hold developer. M Hthe City shall not have an executed agreement with an independent hotel developer which is in full force and eff ct as ofthe expiration of 36 months following the removal of de Hotel Property from the Find Lease, than and in that event the City may use the Hord Property for my purpose that is appropriate and consistent with the overall use ofBaa Park, including the Phase H Master Plan; provided however, Nat immediately following the expiration ofmch 36 month period the City shall advise the Developer in writing of such event (the "City Notice') and the Developer shall have the right and option exercisable upon 60 days prior written notice to the City [ransmined within 60 days of the receipt of the City Notice to cause the City to subject the Held Property to the Food Lease subject to may to the City and Developer reaching agreement upon the development and use of the Hotel Property In the event that the Hotel Property is ratumed and subject m the Fiwi D.esse, the Base Rem shall be mareased to the amour that it would have been pursaam to the Fwd Lease had the Hotel Property not been removed ficin the Premises. In the event the City and Developer do not reach an agreement as to the development and use of the Hotel Property and the same is not remorM and subjected in the Fad Lease as afermaid, than and w that ever the Developer shall have a right of Man refusal to acquire and develop theHotel propcttyat any time flat the City receives an offer from a Mail party acceptable to the City w its sole discretion. ITDeveloper exercises such option and acquires the Hotel Property, Developer shall be retained to develop mid property on Me mine terra and conditions as had been offared by the third party and the Bae Rent dull be increased as herdnaboveprovided. Developer most exercise this right offirt refrsd, w writing, within thirty (30)daysa receivwgwdat wfificadon frons eCiyofthetWrdpartyoder @) PhaseDO61'mtiora ofCitKDuring Phase H the City dull: (1) Zonina:Prepare, in wnsntiation with the Developer, and initiate atone change, which may be a contract zone change, to the eMant necessary to accommodate the implementation of the Phase H Master Plan; and shall not during Phase H and/or prim thereto, Page 5 0£ 10 03-345 adopt any, change in current wring provisions which would probibit or prep otthe construction of hotel to the height requirement for a IN suite hotel as provided in tltis Developmen Agreement. (11) Potential issues of slain : Assist the Developer to resolve my issues that abutters to Bass Park may have as a result of the implementation of the Phase It Maser Plan as provided in this Development Agreement. (�Lndecoatio s; improvements the Promises and may permit weperto schedulep,mdepending construction, renovations azd improvements on the Premises and may permit work tats than ] 00 p.m. depending on the nature ant location ofthe work. 11ce City will make all to review efforts to and spectionova the ousting CSO control structures, subject to review and approval of all plans ant specifications by the City Engineer. (c) Phase B Timeline:: For purposes of this Development Agreement the tum "Phase W shall be and mean the period commencing on the that day that the Developer enjoys possession of the Premises pursuant to the hums of the Firm lease and shall terminate on the year to occur of P) dw completion of the Phare D Improvements, or (I) if the developer consumes a Hote) two years after said the commerc¢meM of said construction. 6. CID -USE OF PREWSES (a) Bane S F' -Lural Lease: Tice City may continue to operate the Bangor State Fair during the term ofthe Initial Cease on that portion of the Premises enol during that period of time not to exceed fourteen (14) days end on substantially those dates as Wilized by the gone Fair during 2003 subject to the following terms and conditions: (1) the City agrees to indemnify and hold harMess We Developer from and against any and all costs, expenses, loess, liabilities, claims and demands of every kind, nature and description(cluding reasonable attorneys fees) arising out afar relating to the use of the Prewses by the State Fair; (H) such use does nW underbelly adversely aff xg the operation ofthe Track and/or the facility in which the Gaining Machines are situated and/or materially interfere with the implementation of the Phase I Improvements; and (III) all conditions to my such use set fnh mthe Initial Lease are fully performed by the City aM/or the State Fair. The City and the Developer shell cooperate to nmdmiw any effects of the operation of the State Fair on the Facility in which Gaming Machines are situated and the implementation of Phase I Improvements. @1 Banner Som Fair -Final Lare: The City may continue to Woods the Bangor State Fair during the term of the Furl Lease on that portion of the Premises seat during that period of Fine nor to exceed founcea (14) days and on substantially those dazes as utilized by the Shade Fair during 2003subjecn to the following terms ant conditions: (1) the City agrees to indemnify and hold harMess the Developer from and against any and of coma, exp arms. losses, liabilities, claims and demands of every kind, nature and description (including aasoroble attorneys fees) arising out of or relating to the use of the Prmmus by the Some Fair, (B) such use does not mazeially adversely affect the operation of the Tmck arguer the facility in which the Gaming Machines are Page 6 of 10 03-345 situated and/or materially interfere with the implementation of the Phase B Improvements; and (Ira all conditions m arty such use set forth in the Final Lease are fully performed by the City and/or the State Farr. If the foregoing conditions are satisfied but the Developer desires that the Bangor State Fair be relocated from Bass Park, the Developer shall provide the City with a least two years notice of the request fm the relocation of the Bangor State Fah and shall pay to the City (at the time of such relocation) $1 million to be used toward costs related to the relocation of the Bangor State Fav, The City and the Developer shall cooperate to mhtmbse any, effects of the operation of the State Fair on the Facility in which Gaming Machines are situated and the implementation orPhase B Improvements. (c) Other Uses —Initial Lease: The City may during the term of the Bridal lease utiliva portion of the Premises not utilized by the Track, the facility in which the Gaming Machines are installed and/or otherwise rot used by the Developer for other Developer events or purposes subject to the following terms and con itions: (1) the City agrees to indemnify and hold ba nless the Developer from and against any and all costs, expenses, losses, liabilities, claims and demands of every kind, nature and description brcluding reasonable runways fees) arising out of or relating to the use of the Premises by the City or others; (U) such use does not materially adversely affect the operation of the Track and/or the facility in which the Gaining Machines are situated and/or normally interfere with the implementation of the Phase I Improvements; and (IB all conditions to any, each use set forth in the Mist Lease with respect to may such use are flatly performed by the City. An 6usebythe Citysl ]l cludebutnotb li6t[ toyouth soccer. (a) As promptly after the date hereafas shall be reasonably practicable the Developer and the City shall enter into goad faith negotiations for the establishment of Tax Increment Financing and Development Plan ("TIF") for the Development Project described in this Development Agreement. If the parties successfully negotiate a TIF, the TIF revenue shall be applied in the following order of priority (1) To fund the cost ofoff--site improvements, including traffic improvements necessaryto obtain a permit from the Maine Department of Transportation and utilities. The City and Developer, and consultants for either party, will work together to develop the most cost- effective solutions to track end parking issues. The City and Developer agree of the need to consider track impacts on the area near Bass Park. (H) TohMthecostsofpublicimpm mean,sedfundstobealloraz onapro rets basis, based upon the Developer's and City's costs of public improvements raluired pursuant to this Development Agreement, 8, FINANCIAL ASSURANCES AND COSTS (a) Phase B Cans: In com¢ctba withthe developmeru ofthePhase B Master Plan, the con of implementing the plana, specifications and designs approved by the Cityfor the Phase B Page 7 of 10 03-345 Improvements shall be determined and referred to berein as the "Phase 11 Costs" (b) Financial Assurances: Prior to commencement of tenancy under the Final Lease the Developer will provide the Cay with adequate performance guarantees, in a form reasonably satisfactory to the City's City Solicitor (including, without limitation, firm commitments from lending institutions, govemmemml agencies and/or othem)that the Developer has the financial capacity (including fin [Itis purpose the proceeds short tem4 irderirq construction and/or permanent loans) to fund the Phase D Costs. 9, ASSIGNMENT: Developer shall not assign its rights to this Development Agreement and the Leases wither[ the prior curium corset of the City; which consent shall not be unreasonable withheld, delayed or conditioned; provided, however, that Ne Developer shall have the right to assign its interest in this Development Agreement and the Leese to Bangor Historic Track, Inc. subsequent to the acquisition by the Developer of a centrolfing interest in Bangor Historic Track, Inc. to. DEV OPERSTATUS: By the execution of this DevelopNem Agreement the City confirms the Developer's status as the eachisive developer her the Development Plan. Upon exaction of this Development Agreement the Devdoper shall not exercise any option it may, lave to acquire any interest in real property, or acquire any interest or order into an agreement to acquire any interest in real property for the construction and/or operation of Track and/or Racha within 50 miles ofBa"gm, Maine, other than Bass park. 11. HARNESS RACING ISCENSE' The Cityshell asam Bmgm H go is Tack ivc. ("BHT') m obtaining int 2004 racing license (and racing dates) by recommeMing to the Mane Hamess Racing Cormmssion that such license should be issued to BHT and by taking no action inconsistent with the germing of such license (and racing dates) m BBT. 12, NOTICES: Any notice wbich either party desires or is required m give to the other in connection with this Development Agreement shall be in writing and shall either be hand delivered or sem postage prepaid, certified mail, return receipt requested, or by overnight delivery service as follows: Bto City: Edward A Barrer, City Manager City of Bangor 73 Ha low Streit Burger, Maine 04401 Ifni Developer: Capital Seven, LLC 1055 E. Tropicam , Avenue, Suite 700 Page 8 of 10 03-365 Las Vegas, Nevada 99119 With a copy to: Marlin J. Gersten, Esq. FreeMran & Gersteq LLP 90 Birch Bill Road Newtown, CT M470 or such other person andror address as may be identified in writing by the parties. l3. CONTRACT The parties intend that this Development Agreement shall operate as wonted under seed, in accordance with 14 MRSA Sec.751, 14, INTEGRATION: This Development Agreement and the Leaves sets forth the entire agreement between the pelves hereto with respect to the subject matter herein contained; shall be governed and consumed in accordance with the laws of the State of Maim; cannot be altered, amended, modified, terminated or rescinded except by a writing executed by the parties hereto; and shell inure to the benefit of oral be binding upon the parties hereto and them respective successors, tmmsfeaees and assigns. Page 9 0£ 10 M WITNESS WBERMF dtis Development Agreement has been executed sear and delivered as of the day and year &m shave wnflen. C"UTT SEVEN, LLC By Shawn Scott Title. CffYY/�( OFFBAJgMR `^' By Ct-� Edward A Barras Its City Manages Page 10 of 10 03-345 BANGOR RACEWAYLWT/dt LEASE AGREEMENT Jk- THIS AGREEMENT, executed az ofthe �j' day of October, 2003, by and between. TBE CITY OF HANGAR, a municipal corporation orgmdxed and existing under sed by virae ofthe laws of the Stare of bYaine, and located a Bangor, Penobscot Couray, Maine (hereinafter retuned to as the "CITY") ni CAPITAL SEVEN, LLC, a Nevada limited liability company, having a place afbusiams in Las Vegas, Nevada (hereinafter referred to as the "TENANT) WITNESSETH: W REAS, the CITY is dint owner of a farmers rating facility consisting of a rare track, grandstand and stables (collectively the "Facility) located in Has City of Bangor al the CITY's Bass Pork Complex; and WHEREAS, the City and the Tenant have this day entered Into a Development Agr«ment (the "Development Ageemem ". the defied ion of which we hereby incorporated herein by reference) with respect to the utilization and development by the Termnt of portion of the Bass Park Complex including the Facility; and WHEREAS, this ageement oflmce ("initial Lease') is being executed pronoun the terms and conditions of the Development Ageemem and is the ageemeat of lease referred to in the Development Ageemmt 0 the "lnhial Lease'. NOW, THEREFORE. the pardon harem agree a5 follows: 1. Premises. The CITY, bar and in wmidoation ofthe teats to be paid andthe obligations to be performed by the TENANT as hereiadder provided, does hereby demise and lease nolo cbe TENANT and TENANT does hereby take and hire from the City, upon and subject to the Term and conditions heaeroafter elated, mtheir preanal physical condition, and for the Term (as defined), the promises and facilities loomed m the CITY's Bass fork Complex, including the Facility and the Indian park designated by cross hatching in the sketch attached buono as"F Mbit l"(collectively &a "Promisee). TENANT hes the option(wrthout any inareaae in rent) to increase the Premises to include all or a portion of the Baas Park Complex described in Exhibit B annexed heron and made a part huwfm accommodate TENANT'S read for the permitted uses. 2. Licenses. Subjectmthe [emis,condi[imu,and limitations with respec[mtiw utilization of the Premises by the City son forth in the Development Ageemevt (which Provisions are iacosporsted herein by reference) and the utilization by the Tartan of the remainder ofthe rmmEmXHM,,m,T" Bass Park Complex, each ofthe Tenant and %e City does hereby grant a license to the other to use the following portions of the Bass Park Complex as herein Wow indicated: a Perkin Areas. Parking areas will be avadable formeby harness racing customers and customers of the Racino as well as customers of older events held m the Bass Peck Complex on a first-mmq fust -saved basis. b. Trader Park. The trader park areas will be available (can a subordinate bans) for use by individuals associated with horse shown held in August and with bevas racing on a priority basis. Any unused space in the Trailer Park will be made a nlabie for shen-tam use by others with the revemse Sam these users to be collected and retained by the CITY. , C. Track and Orsndstawl The track and grandstand areas shall be available for use for other events prior to the date - ofmmmercementofthe racing season. Thetmck and grandstand shall also be available during the racing season on ern -racing days ed after aorg on any racing day where acing is normally scheduled to end by 6:00 p.m Such was shall be permitted Provided that the tack shall not be closed ne horses for moa than three days in any weak from April lit to the date of commencement of the rating season awl fm no more than two days in any week during the racing seame- d. Each of City and the Tmam herby gram to the other a right of passage and easement over its respective portions of the Bass Park Complex for purposes of amass and egress to the env re Bass Pmk Complex. ghom!unitive the genealiry, of the foregoing, the CITY, hs employees,, agents, servama and invitem pees have the rightmataomothe Premisesaterg reasonabkthn rewrch palacing vehicles and equipmentfor the Purposeofmuctmeing,nepahirg and replacing the ivfraswaure, entries and appurta�aavt atruaures thereto. 3. (a) Tarot TO HAVE AND TO HOLD the demised premises unto the TBNANT far an manual tam commencing October 1, 2003 mal ending September 30, 2004 ("initial Term'). PROVIDED, FORTHER, the the Initial Tam shall Int mmmeace with reaped to the huilding known asBam F located e9ass Park unfit Mach 1, 2004. (h) The City does hereby give and grant mato the Tenant the irrevocable nghtand option (the "Option')Wateodt Initial Tennforanaddiennalpenadofoney�(mmmemdag October 1, 2(04 and aiding September 30, 2005); which extended period shall be referred to herein as the "E#ended Tam": and the Initial Tam and! Extended Tam shall be m0ectively referred to herein an the"Tam". The Option may only be exercised (F) by written srotice("exerase Notice') transmitted by the Tenant to the City at least 45 days prior to the expiration of the initial Term and (11) tfon the last day of the Initial Tam these shall exist no material uncured breach of this bdtial!.ease by the Tement Within ten days of receipt of the Exercise Notice and within ten days prior re the expiration of the Initial Term the City shall sa vhw the Tenant in writing, as to the eti& ace (in the opwm of the City) of my materiel secured breach of the Initial lease by the Tmnad; and the Tmmrt, in each instance, shall be entitled to cure the Same prim to the expiration of the Initial Tam 4 TurninutFacilitis/Addi' sand Cbanmo Nobuildingmfacil$Ymary Improvement ca except e change to any a with th buildings or yylsics of fthe Development f ay be ent malcted n an win accordance with the terms oandf conditions and/Or Agreement and/or on m emergency basis for purposes of public safely and/or property preservmem- Itis understood and agreed that the CITY shall remain the legal owner of all buildings, sefuctures, improvemays, facilities and installations currently upon the Promises or which may be erected by the City upon the Premises during the term of this Agreement while any now structure erected by the Tenant shall be and remain the property of the Tavern. Equipment (other than Gaming Muhives avoir equipment related to the operation, maintenance arnd/mshrvicing ofGi ming Machines, ircdudivg widmm IimsatiDM1 currency sorting and comnting machines and retention facilities) owned and installed by TENANT shall become the property of the CITY whse such equipment becomes atyched to ant a feed element of my building strvcbue, in facility owned by the City. 5. Maintenance and Subject to the terms and conditions of the Development Agreement ()TENANT shay, at its sole cost provide all recoveryandsom m and repair of the leased facilities, including the maintenance and repair monetary in keep the facilities in compliance with applicable free aralife safety codes; and (b) TENANT Shall maintain the gni lilies in accordance with first class standards comparable to Other facilities in Mame and New England. The CffY and its designated repreaentaAws shall have a fight of ancess to inspect premises mW facilities and to order corrective measures VaRb cat with the foregoing. Four inspectionsofthedemised Premisesshall6emvduaedbythe Cl mOf about March 19, diving theweek prior to the Bangor State Fair, during the week aRerthe Bmgm SM Fr,duringtheweek Septemberrecingifapplicable,andduriogmefirst the ofesch YnthesaeTerm Thcpmposc in existed 9 the 5nsiamlvsure that Agreement. are maintained AN same orbetasconddiovmexistedatthesyn ofthe Ageement. tithe event TENANwided, Y sladeiraormkeghtto Over yivthehund purpose condition g repairs p charge he Was o such chave epa right o m enter upon the facislY for pmpases ofineking repairs sed m clmrge the coin of such repairs to TBNANT. 6, AwArcedq)xs. The primary use of rise Premises will be for sire house"ruing and directly related activities suit promotion including simulcasting and concerns and the installation and opasfiw of Gaming Machines. Other horse reared events such as horse shows, sales, and demonstrations ase permitted. TENANT sball have the exclusive use ofthc Promises for these uses doting the Tam. ?. Ublhiea' All utility expenses inrAudingwater, electrical, telephone, amen and waste disposal, required to operate tho £remises, Shall be paid by the TENANT (uceptm the stent any portion of such Premise; are u611zed by in under the supervision or conroul of the City, in which mise such cosy shall be boom by the City without right of recoupmem from the Terms). TENANTshall pay CITY fm all CITY -provided nasties m the same rotes the CITY obagos similar customer s. The CITY and TENANT shall ages to a uastY metering amb'or cost allocation plan which will be implemented prior as December 1, 2003. no purpose ofthis plan is to provide fm a wA-effective plan for either separately metering the facilities to be used for 03-345 mciag or appropriately allocating utility costs based on same use by the Team aM/or otbas, m the case may be, g a= LIlatogLardyacy. TINANT shall be responsible for any mall Mas and all required Gcevses slid rasa acting out of relating be Tenant's milimtion ofth, Premises. q, M.n,..'h"v 'me (a) The TENANT shell indemnify, defend and hold harmless the CITY from and against all claims and xtioos, and all expenses incidental in such clamu or actions, baud upon or arising oro mdamagem Property orbljmin m PCTs or other mencom ass eamad ,wondered in by du: TENANT anyone acting under its direction or control or in its behalf in the comm, of Ne TENANT's activates meter this initial Least' provided that TENANTS aforesaid indemnity ad hold hundleea agramevt than am be applicable many liability basad upon the nsghgetze ad/m immsoaal nonmember ofce CITY and/or others milisng the friable,w&on pendent; thereof by license as hereinabove provided. (b) The TENANT hereby cxpreenY Nies that it will defend, annmvify, and hold the Cory of Bangor harmless from soy std all claims made or asserted by TENANT's agents, aavams or employees arising on ofTENANT's activities under this initial 4ace: provided however that Tenant's aforesaid indemnity and hold harmless agreetnem shall not be applicable to any, Lability based upon tlo sagligeace and/or intentional miscmdmct ofgao City and/or other there above provide. For lbb TENANT hereby sexPressly vni�veS MYand all It LY mY have under Mam's Workws' Compensation Am to regadm auch claims made or asserted by TENANT's agent, servama, or e ploys mbjectmthefimUaiomhaemabmvesmfonh. The indemnification pmvideduhaer this paragraph shall extend in and include arty and all Costs initiated by the MY ho answer, mve mete, defend and settle all such clears, mcluditg hot not limited tothe CTTYs coos for avonoy fes, aper and other omm hes, the cog amastgamn, and Payaem in foil of my and all judgments rendered he favor ofTENANT's Nem, servants or employes against the Cay in regard to claims made asserted by such agarts, servants, or employes. (c) The CITY shall magnify, defend, and hold harmless the TENANT from and against all clams and arsons. and all expenses incidenmlm Rich claims 9r comm, bold upon or casing mut ofdamgeto property orinjm es In promos or other tortmms acts caused or wmrilated in by the CITym anyone acting malar its dneoon or Cormol orin zs behalf in the comae oftlne=5 activities nMa this initial Lsse and/or ordersand/or porton shared Pasant on &a license gamed, the Chy, provided Naz CITY'S aforesaid indemnity and hold burden agreement shell not be appGsble many liability based upon the negligence and/or intentional misconduct Of 110 TENANT or anyone acting under its direction or snouol orin its bchafin the comae of do Tesm'a soliciting under thus Indian Lore. (d) Tice f= hereby,prssly agrees that it will called indemnify and hold the TENANT parades, Som any end ag clams made or asserted! by CITY's agents, savants m employes arising out ofCITY's activities major this initial Lase; provided Iwwever that =T s aforesaid indeamty and hold harmless agreement ghall not be applicable to ary Lability based upon theo,gligeoce and/or bt,mmaid mcameas m of the TENANT or anyone acting ander rtes direction or control or in los behalf in the comm of do Tenant's activities under this howl Lease. For this purpose, CITY hereby epresslY waves may and all cam ethy n may have mda Maine's Workas' Compensation Am inregadm tush clams made m aesrtedby C[IY's egeds, unams,oremployees subject m the limitation hereinabove a4 forth. The indevmaficatiov provided under this paragraph shall extent w and holude cry and all was renewed by the TENANT he answer, mvra ig rbg defend and cattle all such claims, including but not limited to Me TENANT's costa for attorney fres, expert and other entities &es, the cost of investigators, and Paymrnt'ntall ofaay and ail judgments rmdaed in favor of ='a agents, mvints or anployees against the TENANT in regard m chains made in asserted by such agents, servants, or employers- iii, Woomera The II 'd and W £Il .duri dr T Ta comectioawah lbe empbymev[ ofasetWlcyee; TENANT shall Pay all applicable social seavty, unemployment, vmrkes' wmpensation, in oiha amploymed tams or omaibmiora of insurance and shall wmply with all federal and elate hie and wareoristydns ,aintsimvpgeamrttiopclwuolyapmrl. oeTyamEiNmemAuNrgaeTnece sahdaanlltyd mawnddoermtkoesdrwfsy'a geensd, the CITYfrom all m&s, expevses, ddms or damages resettling firm any Wive of TENANT to wmply with these requirements. b. TENANT shad processes and maintain mmprehevsive genual (ubilay and mrtamobtle liability insurance on behalf of itself and the CITY (as Their respective unseats may appear) again¢[ any damagik lose or liability m claims alleged he have arisen from the use or occupancy by TENANT of the Premises. With rasp= an the required insurance, the CITY shell be named as an addiamal insured; be provided with a waiver of submgarioa in favor of the CITY; and shall be Provided with tWrty (30) days prior notice of cancellffion or material change; and shall be provided, through the Office of We Cay Sdiclror, with certifrcame of insurance evidencing the above rearmed iasmaane The rent of such anemone shag be paid directly by TENANT. c. The amouas afsuch roverage shall be no less than as the follows Tie 1. Walkers' Compensation Sraamy Employes Liability 2. Comprehensive Public Liability to include ha out he Wished to Ne fdlOMng: a) premieen/apuabam b) independent tomorrow c) Paso" injury conizage Amm.m $114cembined single limit SIM combined single limit with additional umbrella policy for not less than S? 03-365 03-345 d) produWwmplet d opvarians e) contractual liability 3. Camprehevsive Automobile SiM wmbi 5d so& limit coverage for: mimdude coverage for: a) owmd/ientdautomobiles b) non -owned aummabdes c) hared cars 4. Standard Pom Freor Replacement value All Risklnmmnw PORcy (d) ShmW TENANt' dean% CC mdll meter a vainest that Paeer An Risk Immance be provided by the CITY and shall he paid, on an agreed pro-nas basis, by TETIANT for,Porten of situp cL TENANL atopies the raper p . in the evad Owned by the agent any ofthePremiseser casthm [meant Buri es cENANTSarebucted and Owmdhythe TENANT)dee m fire Or 011ier Lor o casualty OLwnbig dmhlg TENANTS use 0r TENANT Or TENANg,s ag TENANT'Suse oraavpamymi yces,estak of TEN NTsregbhall the taken m TENANT'S cause by the negligence comtace an yo employees, TENANT t of mthe e+Yent ec such lose vote rotcmtad, or r a ployers,emtNoravmtionalmisconductofthe City, its 'gems, servants orrapapra, Oremployees, reimburw Inthecon ver CITY mYPoram ofthdCTTY's cost ef replacing orrepaipivg the Partmxdar 6cniRes L°°ce°d that is tut reimbursed by applicable fire ora➢risk ivsmmce. O r minwmrce pdicy Ped by TmvANr shall arfimasproly some that A win not be invalidated because the pommel radved its rights ofrecovery against say Party Prior to the ocaarence of a loss. ti. �anC ^ . TENANT ad its mployess shall operate an An independent contractor and neither TENANT nor TENANT', employees shall be responsible mmmrm's ag,nmmemployeucfthe Ci TY. The CTlY to, llaoX$ responsiblefar TENANT'S fnmaidonan panes cronng btu tot limited to, eracinandwages earnedbyemployees,prime distribution and Primes wooduring the course ofthe raring meet, or morals due midepedent wnmvedas, hmsemm, vendmsend Patrons. 12. CombancewithLaws. TBNANTwiliwmPlywffiaRfrdasl,stateandlocal statutes, runes, ordinance and regpj tions as they oder, mthe operation of the raceway and related facilities. 13. Noo-I)isafiffliazli In mndtmting activities order this Agreement, TENANT shall not discriminate on the basis of one, color, sex, creed, religion, ancestry, national origin, W or disability, or on any other mama prohibited by law, and "I rot fait or refuse to hire an employee or accord adverse, or unequal treatment to very Person Or mPlOYee wish respect to application, hiring limning, apprenticeship, tempo¢, promotion, upgmdng compmsetion, IayotE discharge or my other base or condition ofmploYment u spry roamer prohibited by law 14. C�Qoog. Subjax to the provisions ofthe nerd sentence, TENANT shall bave the ,josive right to sell alcoholic beverages on the Prmises during the Term and 91WI have the 03-345 riot to operate or let all food and drink concessions a me Remises. The CITse e ri&ba provide [base services and concessions for MY eaam apvosored m permitted CITY wits capacity as a hcemne a a portionmf the Pr agreement Provided. TENANT mat exerdm Imss jim, d'veNY as, cement with a reputable area concessionshe mereablY acceptable m the CIIY. 15. ftfChv In er¢mv. TENANT shdlPmchase all ma{menavamataiala endmppbdonhandandownMbYfhe CTTYffit d=ofthecommencemerdofthe Radog Seams Price wJl babesed maaud CPfY coma 16. iRR Hord. TENANT shall Prima the MY with a radmablY acceptable Corporate sty bond in the ismel mm Of$30,000 Payable roshe ITIY, Q amhodmr ure senvirydi¢acceptablemfhe a SoGcaor,fvr me faithful perfmmanen ofd] ditial and obligativas Minnsciupon TENANT by and uodertheterme ofthu Toitid Lda. Hond arotlta ancepedre semdty may be provided wolammn(10) days ofaward amended ra ing amt licmato TENANT by the Ma'°e Hatnrsa Eating Commission nerthe Racing Sorin a le additim ro serving d a Poor°m°ce bond, tEis ammmt, ifPmvided in m appropri acceptable to the City sotichor, shdldm tulBll theludan e go irrevocable testa of iremmt oudsn�in Section 22 blow for a Damage Deposit. Acceptable security maY ivc deposit. Said PQfOrmx°ce bord shall remain infnuns.ffiamivimum, uvti130 dayre frilowingtae mornmentatheTmo. Il. A dig IRs b —el C.ovds[em wish the tams ofthia initial ^°`e, TENANT shall Qertise sand husmedludgmem, coopemmvdW the CITY, a� be opeom the CITTsrewmm®ilnet and advice. The CITY's and TENANT's s�e,.pomaibiliiies shall include, [bough net be limited m, the foPowing: a w1 od Publi dRa TENANT IS mindful ofthe irvpaa Mthe opmenovof bands rac tomcats and Gaming hdsch7 eactivi mn immedismnei hbnrhnodandsuaoundingarea T'INANf egrmem adhaemtbefnilowine guiddives: i. No five tate shag smrta@a 11:00ed leaned odds. Beeman peforeaeenemmgmcy such as, but redtrts mare ]oss of men, Power. lossded, or IM sa3mbee rmthe rmmmi mea del'Y _ be mS a loss ofmibuTEN gNT alt, haat ere delayed fn la eP masmnrea TENANT Opal]Maine every effm of ae beer Imcomnsand a f12moperating ata reasonable bare, inmcese labor than 12 midnight. u. TENANT,mcmd°ctigq TENANT'¢aaivitid u>ber [bismar�en iofet shell none rthiamusto Pr event gemmtian ofQ noise noise. For pit puryonges ce mice dull Como dim of a disturb the p aceM1 wintensityT IikdYmrmrdserfies amounfhe Peacese Park Co Complex Of ,mind atime, TEs suoowdiogthe nad Park Complm forestmaterial period dome TENANT andl rthe peace CITY nfany omm n s of rea arms, nvha6s,ar dutrvEtheOda of peor imuY Compcomments tandssof *omen al properoQ on ramdmg ille Hampazk a andIM and aiaH CGpPQa(e W(Ill Cfl'YLO ml' Wmi20llre dlannbaaee 80d/m lM1E 1mPaet Illaenf. o3 -Jas id. To the best of its ability, TENANT shah noun` that hose is am and facility traffic will comply with all apphouble any rules and regalalmand b. pagaCarrbal. TENANT"Iberespoosiblefvallnecessary Pvgncran,booricee. TENANT awthe CITY maymumally AgreeC. m aprorafion ofaomml P� covv°I services. C Eemovat The CffYshahberespooslblefmanow removal servim. d. Trasb Bemo_vaL TENANT shall be respowible for all wage and trash removalsavbea, thattbgremovalanaldisposal ofinersre Wovdedhoweluding as City ct Its througyh B licence as hereinabove Provided (including panacea naive& generate City m is Warily u such) shall be responsible for the rmoval nabangeoaaredlow®eeb°v with their use of all or a Prov Of the Premises s9 heceivabov a pmvidM. eeadP TENANT shall obtain and miNain W, bceoees and Warfm neceuary for TENANT intense and operate iu busiveum. f F' ed Auer In ohm TFPIAr'T ahellt°Ira ycemmerKement of the Tam. ovmnabip of she fined uxu oftlm Premises 2W3withafuhandoomPlebe The CITY shall provide TENANT by Decmba I, William fin? ofatmcmras, fachar and imWovemeou within the Pretences. TENANT shall accept this fined ascet inventory and maY refocus aPhYmcd °ram through and vo ifiocioncrithadempated repreecatatbxoftheCRY. Proper antinion of my disaepenaes shall he made and ititiated by both Parties on the writer no gory. During then period ofum, TENANT shall aaarme all maintenance and ra l air "a OR each equhPmcot. DranCening ThefTfYvnllbereapoosibleforallgrava arturea throughout the Premises 18. pct_S (a) TAT will inama that adequme eec a ty i availabie for aE -veru heldwrhe FacilitynAsaybuildivgor,ina pemvsmraedbythe Tenon(cohecthety "TeoavtSwcvrrepar TENANTdmh Panfin Facatyand withaeang iefofPdiceofthe Baasortline tD dweof socurym beeFaahtyaringr Temvtnburnmed Tbie Plea epu� of aernritymbe provided dusmg racing. Utif'orvmd Police shall outlive the level and type oh'c-m be o6cem shah be i¢mcevdence at all hameasracivg everts The rumba ofurdfhrmedp presentdmgbeatablished' thelointsearritYPlan (b) To addition, the ChiefofPOboa of the Bangor Police"b"bermevt may,m his discretion, requan TENANT to Pmtrde a higher level of reformed Policembe Presentdthe Faafity duriaggaan6 gnu°°i°orderm Wean" -mala a�pmma Bves and WoPevY. Tndve, event of a dispute between the TENANT andthe Chief ofPne d m h to the gthemantas of oreformed Police officers requbod, the dispute shall be aubmitteCity hftnaga ofthe City of Earquor whose deter®natiov shah be find. (c) Uniformed police scanty my be aupplemented by using local autrect security, TENANT'sowoseauityemploycMaothaeourcesofsowntYaervim. TbeChiefofPotiaOf- the City ofBavga gall cetera the authority to deem TENANT to rernve floor this responsi- bilitymyindividual engegelinprovidingsecurity services fa my reason. The required ,comity plass shall be dealOped and approved by TENANT and the CITY within sigy(00) days of the date of this Ntial Lasa: and inthe occur such Plan Shall ver, within wcb period, be dcvdc* and approved, the plan developed and approved for use during 2003 shall remain in full force and effect until mperceded. TENANT shall Pay the CITY for use ofuniformed police officer, at the same rate established by the COPY for arch cervica provided m othar Panties 19. F Protection TENANT shall abide by all fife wnetyand dbythe Code "o balisbad by the Sure of,,,sine and the Cff Y ss imnpmred o Enfmcemem Officer oftbe City ofBsagma the Sime Fm Manbsl's OHice 20. Pvmevtt rhe Ch. (a)TENANTsWpay�CITYaarm[forthe Prcmisaa pay orthe CITY an ack iliooal fee track and tillioe OH lrme:axmng mcumes wage.,. V. Thousand Dollars ($30,000.00) the Pucaterge auount by which sold amoum accede $30,000.00 slag be m ldphed by tbe Base Fee to dete Sine Oce amnmt ofthe Additional Fa. CITY abell invoice TENANT the fall emw,m ofthe Base Fee on November 19 of each Year a tba Agreemen[. TF.NMU dal Pay the fee(s)ies accur M equal monthly in6tdimevm beginning Novemberia. An Addifloud Fanaduew01 =kuatadateheaudofthe Radog S wnandbepaYablebYSePterabul". Sholazly. any Addhonal Pcepayabie with reVmw bee 1,2003. NANadofaromman CM Copses ave sew be Ai the Teoave, TENANTshell provideto CM ithe;es aspects requ'vm ma ....e.sa..ri.e n,1 venom placed a made mire Premix,, uwe0 as all @) ifPriorm tice apiculi°° offhe Perm. We Tevemoaarpiw the Premises Prasuavtmthewme orad condi[iomofthe Foal Leen tba aM in ibat evem: (-0the Tem ahaR expire m ofNa cod of ibe obscuring whichoavpanry by the Tenant shill ammeae pmsuamm the Fua Lease ora (m whhin one yeufollowmg the ammena ons"ofrhe Temvl's temmY Pmwatto the Final Lease the Taavr abell P%you CLLy the Rae Differential as defaced). For PmPoses of ids Initial Leone rho tome (A) "gran Differential" shall ban and man tine excess. ifmY. ofehe Fva Rau Reoml (ere defined) overtbe sum oftbe AcWal Rem (ere defined); (B) "Pied Haa Retial" shall be and mese the sum de[amiveA by milnPiyivg(y) an Ego; or 1(12®0£ tbe Bass Rat, as defivrd in rhe Final Lax by (z) tbe awarder of full wlcedar mowLs during which the Tempt bas occupied the Premises ounces rhe Burial Lease: and (c) `Anlud Rem' dal be and recurs cumwmt ofBsse Fcea and AddniomlFoeactucany Paid go; Tonave to the City under the bestial Lanae. 21, Otha Payarevts.(A) theL ,*shag Paymrhe Chy, aportionoftbe Goss Slot Aaverva actuallyreaivNbyfm Leasee C'p d&vmined m follows: 30%oftbe fd S3Q0,OWofRGmoCsw) Slot gesaheuTeaaraannuallymallly received by the lessee dmiog the Term; 4°/. o[Gou Slot Revaues betwcert $50,000,001 and $]0,000.000 03-345 adually received by the Lessee during the Tam; 5a/. cfGros SIM Revermes between M,WO,Wl end $jW wo,000 act atlyreceived by the Lessee during the Term; and 6%of Gross Slot Revewms in excess of$iW hIq MO eau ][y received by the Lessee during the Term Paymem of gm Percentage Rent with respect to earl Ahmed Period shall be paid athe times end m the manner set libidt in subparagraph (B) hereof. (B) Within 30 days following the end ofewh ofthe calendar months commenting during the Term, the Lessee shat pay to the City thm porion of the Percentage Rent, ifarry, dcunumud w follows Gent, the Gross Slot Rtrwue received by the Lessee during the Period commencing on the first day ofthe Term and terminaling on the last day of the subjea month shall be determined (the "Cnmulsts" Revenue Amount") second, the anmum of the Parentage Raaf payable with respect he the Comoladve gever a Amount shall be determined m accordance with the provisions of subparagraph (A) hereof (the `C4mmalive Percent Rem'); thud, al payments ofPercentege Rem made by the Lessee during the Term shall be aggregated ("Cumu brmve Payments To D"); sent fomih, the meess, ffmy, of the Cumulative Percentage Rem over the lAmdetive Payments To Dam shall be paid to the City. 22, Damaue Myosin Within two(2)weeks following the CTY's annual pre-mce inspection of the Premises (i.e., the inspection which is to ocsu on or abut Mach la 2M W), TENANT "I deposit with the CITY the sum a Too Thousand Dollars ($I0,00D.00) to beheld by the CITY as a deposit agmem the CTTY's cou himpsiring my emrepaired damage In the Premises caused by the TENANT, is employees, horsemen, vendom, harms racing pstrom, Or others using the Premises during the Seeing Sesser Followingthewnchsionofthe Racing Semaon andprimro the cart ofthe Bangor Stere Fair, the CTfY ahai also conduct msspecnona of the premises u provided lnpamgmph 5 above the purpose ofidemif}dng my unrepaired dsara¢emrbe Premisesaaesioned by TENANT'T'S use thaw£ the CflYdWlrrovide TENANT Mortothe star of the Eager Score Fan, mwithindurty (30) days of the CITY' nmica to TENANT, as the=rmY dues. 1fentrepabol by TENANT, within suchped the Cll'Y may repmror corsesuchitemsac named,endmayapply TENANT'Sdpoag depositas fiedssasyfor then puryoa. Asawoditiscentwa en to TENANTshandeposrc the CITYformsT..i ttia, rff the damegedepositamountfo Tan coousund Dollars mmencmento 1f 111 Mn M1 iinnn mmimii�..�MtM Tnm MFx4un A¢afP3nk Of the commencement of unexpwded on expnatmn of to the Final Lease the uexpended balance of Tenant's damage deposit shill be refunded to Tenant Said damagedeposiSwhethermcmdedas par of Performance Bond(ParegraPb 14 shove) m otherwise, sball remain m force, a a minimum, ur ill 30 days following the expiration ofthe Tenn. 23. Adverinioe. TENANT shell haw the right m colica and display advertising whium and aroud the thavdssnd on the mama shadow fame and a uy lacsion a which Gaming Machines we iastafted a the Premises. Such advertising must comply with the Advertising Policy of the; Bangor (Sty Comwil a cannery adopted of as it may, from time to time, be amended. 24. Event Sim. CITYshal provide TENANT with the right to placean event sign adjacenttotee Bess ParkWoperty, a a location mrually acceptableto CTTYand TENANT. he 03-365 addition, CTTY shag make space available no&a Hass Park lighted maniuee sign located on [damn Street wheneverposs3le. 25. D tend of Maj Rena"v kh Premis Ifduringthe Term(a)amataid portion of the Facility and/or a material portion of the portion of the premises in which Gaming Machines have been installed shall be destroyed by fire, explosion or other casualty, or because of normal wen and tear same expand be safely command, and (b) me CITY or TENANT fails to commeuceIn rebuild, repair and reopen the same for business within silty (60) days after the happening of said even, then mther party shall have the right (but net obligamon) to termimre this Agreement. All proceeds ofmannoee resulting from any such owner shall be paid over to the party underommag snob rep urs and utilized by such party to rebuild or repair the Remises. 26. TaTwon,Subject on and m accordance with the provisions of the Development Agreement; the TENANT agrees to pay, when due, any and all[sees an&cur essmmds, fess or chargee ofany load whatsoever, as may be imposed during the Term by mry govammemal mrthority, upon the prmiun and any other portion ofthe Bass Park Complex o which Gaming Machmec ase, imtalledcoal planned by the Tenant, including Lessees leasehold interest therei , asty smunmes or improvesnevm lhereon,orany persomlpropaty lam[d Bcerein. riiseWrmsly agreed thnsuch tawsaad assessmmfa sbaE include all amastia levied as real eamta taxes upon tbe dmiadpremises by the Lessor actieginirs governmenW eapantty sod shall be compered m woun nnce wid ail name orons ijage of arommen Agreement TE the demrther rcvds waives anyandallrightsmPrivileges or ransay owfrom stmon wt he demised improvements THNANPS somal property to aced therein ore my buildings, parterres or improve &MiSW rwq wooses by City opertylocatedthertiv mixing,ImI due public shall ip ofthedemised premises by the City oving ba r; Provided, hosanna, corning thein ehern nt any way prohibit tbe TBNANT finer mercieing ns dgbb under the law an mnex[he ammm[s of such trees, auesmmevta, chores or fees 27. Termination and Defmth. IfTEMANT(a) fails to pay or deposit aures due within sewn (T) days following written demand therefore transmitted by the City m the Tenant, Or (b) fails to comely in all material respects with ha other material obligations under the tams ofthis Agreement, and the TENANT failsm ave such failure within thirty (M) days list written notice thereofmavmitted by the City In the Tenant, (which notice shall specify insufficient demi) the specific circumstances so as to love the TENANT adnlume notice and the oPPortmity to pax the same), the CTTY may Won expiration ofmmh period, as the man may be, roommate 'assanduntilruminatedbytheawardoftheab&at rs. Upon k the Teased stall hawthe wen rights and obhgxiona with respeu smderthe FinalL . 28. No had Vemma Nothing contained heroin shall be deed or combined by the parties, nor by any thsd petty, as seating the relationship of principal and agent m of partnership or joint venture between the parties, Awing understood and agreed that neither the method ofcompumtioo ofrene am my other pm^sion err any other acts of the parties shall be deed re prose soy risabonchip between the mature; other than shot of landlord and tempt. 03-345 29. Nov -Waiver. The failure of Cuba party at any unions mJorre a provision of this Imfml Lease shall m no way mnstimte awsiver of Om pmvisiou. tourist runaway affect titre validity of this Initial Lease army Part therovf orthe right of such parry thereof to enforoseaeh and every provision bumf. M. Amendment. Thepntes may ammdthubdtid Lease only bywritten agreement eseaned by the Entire. 31.. No As.�n...m..n. TENANT dWI mt resign, sablM colt tans(¢, motherwive dispose of its amount in this Initial Lease without the priorwritten approval ofthe CITY,except to Bangor lFsmric Trac$Inc. as provided in the afor®eatmnN lkWopment Agreement betwemthepaides. Thisbe Leasashallbebindimg nerd etatheb=fitofthe Parties lesions, their suuzawrs end pemtted annins. 32. Severebitity. Any provision of this Agreement declared i v"by a enter competent jurisdiction shat sit is alidate the remaining provisions of this Agreement: 33. maw. This Agreement shall be governed exclusively by ted provisoes herrofaodbythelawaofthe St ofMaine,astbesmcomay Gamtimetotimeug. No"t shallbebroughthymi partytomt'mcemyofthetomsorprovimmofthis Agreemem, unless brought in fie Penobscot Coumy, Maine District Or Superior Cour orthe Federal Courts havbrgjuriadic[anand/orsuingmv SineofMaive. 34. Notices- All notices required by this Agreement sball be in writing aed sbadl be sufficiemly given and served upon the other petty either hand delivered or sent by registered or retifie l United Stites mail, postage prepaid, or overnight delivery severe and addressed as follows: Ifsmt to CITY: Edward A Barret, City Mamgm CityofBaegor . 73 llarlow Stent Bettina, ME 04401 m a[ such ether place asthe MY may, from time to I me, desigmm by codes b TENANT. Usereo TENANT: Capital Sevin, LLC 1035 E. Tropicana Aveme Soho 700 las Vegas, Nevada 89119 Withacopyro: or or such otbu plme ss TENANT may, from tie mune, designate to the CITY 35. Isoc lion This Initial Lean and 0 appendices and amendmema hereto sued the Development Agrees men embodythe entire agreement of the parties rearing to the drain and 03-365 obligations required hereunder. Them are no promisee, terms, conditions aobtigaumas other tem those wvtainai herein and the Development Agreement and this Initial Lean shall supersede all previous communications, representation; or agreements, enter end or wm oat between the parties hereto. 36. Arbitration. Any mdall disputes and mvtroversies miring out ofa relating to tbu hstial Lease and/or the Develogmen Agreement shall be submitted to and settled by arbitration to be held in flue: City of Ranges, State of Maim in accordance with the rules and regulafions of the American Arbitration Association then obtaimvg Such acbitretiou shall be held beforethree arbitrator; can of whom shall be designated by Be City, one of wham shall be designated by the Tenant;evdamofwhomsballbedes*gn Mbytheothatwombinatars. Thedecisimofa majority of the arbmanors shall be binding; any award may include the reimbursement to either party affee; mats and count ms ivmvred in wmectiwwrth such mburetiov; suit ouch award may be eN'araed in any mmtofwmpmv[jurisdiction, IN WITNESS WTIERIEOF, the paries have respectively ¢secured or caused this Agreement to be exeemed the day and year first writes above. WITNESS: CITY OF OF BANGOR — IBY) rlZeoQ.rel U N chy ILC Ire City Manager VpITNESS: CAPITAL SEVEN, LLC �VIW (BY) T¢le: Ra[:NBFA ' STATE OF MAiN11 PENOBSCOT, se October 1 2003 Then persenally agitated the above-named Edward A. Barrett, City Manager a the city ofBauger, aMatlmowledged the foregoing iwmmen m 6ehis &oaR and dad inhis said capacity, and the free actand deed of saidbody corpome. Before me, /y�� r & L-C'tY-Y NaeryPubbes Avusucy as<- TERRILWREY 13 NOTRRYYNNIIq NFINE WtOYINSNON EIPIRES 600 ER 22, 2061 STATE OP_ C" e V .ht eL AQOAWM In Ocmber$�2003 T ressonany appeaM the abovenamed sbawnswt, MUMM a Capital seven, ILC, and acknowledged the act and deed in his said rapacity, and the free act and deed of said body coryomm. - Before me, KKu,,pNC'%. `eaoy *.iTto7A,pj,:c v Assume ='ra:pGBLIC ;I%-` Yel(Kaang ..... I. yj ..Pg" ExPleetion Date: June 3,=5 xh Omnakk o• and between: 03-365 INDE=RE OF FINAL LEASE THIS INDENTIAIE OF LEASE, executed as of the Is day of Combat, 2003, by CITY OF BANGOR, a municipal corporation organized and existing under and by virtue of the laws of the State of Maine, and having its principal offices at 73 Harlow Stre t, Bangor, Maine (hereinafter referred to as "Lessor"); nUs CAPITAL SEVEN, LLC, a limited liability company organized and existing under the laws of the State of Nevada, and having a regular place of business in Las Vegas, State of Nevada (berehmder sometimes referred to as "Lessee") WITNESSETH: WHEREAS, the Lessor is the owner of improved real property commonly known as Bass Park located on Dutton Street in the City of Burger, County of Penobscot, Slate of Maine; and Wf16ItEAS, the Lessor and the Lessee have this day entered into a Development Agreement (the "Development Agreement'', the definitions of which are hereby incorporated herein by reference) with respect to the milization and development by the Tenant of a portion of Bass Park, and �REAS, simultaneously with the attention hereof, the Lessor and Lessee have exteuted the Wtial Lease with respect to a portion of the Premises (as therein defined); and WHEREAS, this Indenture of Final Lease C Final Lease") with respect to a portion of Bass Park is being etteun.N pursuant to the terms and conditions of the Development Agreement and is the ageemert of lease referred to in the Development Agreement as the "Final Lease". NOW, TIfrREFORE, IN CONSII)ERATION of the premises and the mutual promises, covermnts, terms and conditions contained in this Final Lease the parties do hereby agree as follows: EXHIBIT � D 03-345 1. The Lessm, for and nt consideration oftherents to be paid and the obligations to be performed by Less« as hereinafter provided, does hereby demise and lease unto Lessee, and the Lessee does hereby take and hire from the Lessor during the Term (as defined) and, upon and subject in the terms and conditions hereinafter expressed, the premises designated by cross hatching in the sketch annexed hereto as Exhibit "l"together with all improvements thertto, therean aml thereunder shouted, all in its present physical condition (collectively the "Premises") 2. Anything in paragraph l of cle I hereof to the contrary. (A) If (A) all of the Development Permits shall have been fully and timely issued with respect to the conswaion of 100 suite hotel at the area indicated on the Phase H Master Plan (the "Hotel"), and (B) the Lessee shall not have commenced concoction of the Hotel within the first an occur of (y) the expiration of the third year of the hdtiel Term (as defined) of the Final Lease, or (s) the explosion of one year after the conclusion of the first calendar year doting which Gaming Machines operated by the Lessee at the Premises gmeram $60 million in annual Gross Slot Reveone (as defined) based on a calendar year, then that portion of the Premises designed on the Phase H Master Planf combination 0fthe Hotel (the 'Hotel Property') may, at the Lessor's option ("Removal Option"), be renewed firm the Fiml Lease, with a proportionate reduction in Base Rom (as defined), as herein provided. The Lessor may only exercise its Removal Option upon 30 days prior written notice to the Lessee during which period cum (in theform ofcommmcememofconstruction of the Hotel) shall be permitted, If the Hired property is removed from the Forel Lease pursumn to the exercise of the Removal Option the Lessor shall make all good bath efforts to lease or sen the Hotel Property for the development of a Hotel by an independent hotel developer ("Independent Developed). For purposes of this Final Lease the term "C nss Slat Revenue" shall be and mean money or credits inserted in a Gering Machine unions money or credits or pri nes paid out to winners. (B) Ifthe Lessor sball not have an "coined agreement with an Independent Developer which is in full force and effect as of the expiration of 36 months following the removal of the Hotel Property from the Final Lesse pursuant to the exorcise of the Removal Option, then and in that event the Lessor may use the Had Property, for any purpose (other than the operation of a Track, Racino and/or Gaming Machines) thus is appropriate and consistent with the wemll use ofBass Park including the Phase H MasterPlan; provided however, that immediately fallowing the expiration of such 36 month period the Feasor shall advise the Lessee in writing of the absence of such an "coated agmement (the "Lessor Notice) and the Lessee shell have the right and option (the "Recovery Option") exercisable upon 60 days prior wrimen notice tithe Lessor maintained within 60 days of the receipt of the Lessor Notice to cause the Lessor to subject the Holed property to the Final Lease subject only to the Lessor and Lessee reaching agreement upon the development and use of the Hotel Property intheewemthatthe Hotel Property is resumed and subject in declined Lease, the Base Rem shell be increased to the same amount that it would have been pursuers to the Final Lease had the Hord property not been removed from the Premises. In the evemme Lessor and lesseedo retrench an summers as to Page2off n 03-345 the development and use of the Hotel Property and the same is not restored and subjected m the Final Lease as aforesaid, then and in that event the Lessee stall have the right of find refusal ("First Refusal Option") to acquire and develop the HoW Property exercisable at airy time that the Lessor receives an offer Been a third party acceptable to the Lessor in its sole discretion for development of the Hotel Property. Lessor shall give Lasses written notice("Altemarive Notice') of its receipt of an acceptable proposal within 30 days ofLessor determining that such proposal is acceptable. XLessee exercises each First Refusal Option and the Hotel Property is restored and subjected to the Final Lease, Lessee shall be required to develop said property on the same terms and conditions as bad been offered by the dead party and the Base Rent shall be increased as hereinabove provided. Lessee must exercise this Fuad Refusal Option, in writing, within thirty (30) days after receiving the Alternative Notice from the Lessor. ARTICLED—LICENSE 1. Subjecttothetetms, conditions and limitations with respectto the utilization of the Premises by the City for the operation of the Bangor State Fah set forth in the Development Agreement (which provisions am incorporated herein by reference) the loses does hereby grant a license (the "License') to the Lessor to operate the Bangor State Fair during the Term (as defined) on that portion of ma Premises and during that period of time rat to exceed fourteen (14) days and on substantially those dates as udlized by the Stale Fah during 2003. 2, The Lessee shall have the right, exercisable m its sole and absolute discretion, and upon 24 months prior written notice to the Lessor to terminate the License; provided however that at the time of the termination of the Liccrue and as a condition precedent therein the Lessee shell pay to the Lessor the sum of$1,000,000 00 to be utilized by the Lessor to deftay costs related mthe relocation of the Bangor Stale Fair. ARTICLE 1H- TERM 1, TO HAVE AND TO HOLD the demised Premises unto the Lessee for a term (the "Initial Tam') commencing on the Commencement Dme (as defined) and continuing for a period often years thereafter. For purposes of this Final Lease the term(a)"Commencement Dme^ shall be mal mem the that day of the fast calendar month following the date upon which both of the Phase H Conditions (as defined) are satisfied; (b)'Phase H Coadhions" shall be and mean each and both of (1) the receipt by the Lessee of all necessary entitlements, permits and approvals (collectively "Operating Permits') for the operation at ted Pecauxus of at least 1,000 Gaming Machines (or the maximum amount permitted by State law), and (H) the commencement by Lessee ofCommeroial Operation (as defined) of Gaming Machines at the Premises: (c) "Commercial Clarence shall be and mean the installation of at least 250 Gaming Machines; aW (d) "Enabling Legislation" shall be and mean a law adopted by the Legislature of the Sime of Was amber by public referendum audemizing the installation and operation of Gaming Machines atthe Prenrises. Lessee shall (e) within 45 days following the adaption ofErabling Page 3 of 23 Legislation apply for all Operating Permits and subsequent to such filing diligently prosecute such filings and (t) commence Commercial Operation ofOomin Machines within 6 months after receipt by Lessee of all necessary Operating Permits and all Development Permits required in connection with the covstmaioq occupancy and use of my facility renovated and/or constructed for the operation of Owning Machines at the Premises. 2, The Lessor does hereby give and grant unto the Lessec the irrevocable right and option (the "First Option') m extend the Tribal Term for an additional period often years (commencing on the first day following the expiration of the L�itial Term and confirming for a period often years thereafter); which extended period shall be referred to herein as the "First Emended Tenn". The First Option may only be examined: (1) by written notice ("First Exercise Notice") transmitted by the Lessee to the Lessor m least W days prior m the expiration of the Initial Term; and (E) if an the last day of the Initial Term there shall exist no material uncured breachofthis Fuel Leasebythe Lessee. Within ten days ofreonpt ofthe First Exercise Notice and within ten days prior to the expiration of the Initial Term the Lessor shall advise the Lessee, in writing, as to the existence (in the opinion ofthe Lessor) of any material rumored breach of the Final Lease by the Lessee; and the Lessee, in each instance, shall be entitled to cure the same prior to the expuatior of the Initial Term. 3. The Lessor does hereby give and great unto the Lessee the irrevocable right and option (the "Second Option') to extend the Initial Term for an additional period often years (wmmevcing on the first day following the expiration of the First Extended Tam and continuing for a period of years thereafter); which extended period shall be referred to herein as the "Swond Exuaded Term". The Second Option may only be exercised:(1) by written notice ("Second Exercise Notice") transmittal by the Lessee to the Lessor at least 90 days prior to the expiration of the First Extended Tam; (H) if on the last day of the First Extended Term there shall exist no material uncured breach of this Final Lease by the Lessee; and (III) if the Fust Option was exercised. Within tendays of receipt of the Second ExerciseNotice and within tan days period to the expiration of the First Extended Tam the Lessor shall advise the Lessee, in writing, as to the existence (in the opinion ofthe Lessor) ofany material unwared breach of the Final Lease by the Lessee; and the Lessee, in each instance, shall be a tlel to cure the same prior to the expiration of the First Extended Tenn. 4. The Lessor does hereby give iad grant onto the Lessee the isrevocable right and option (the "Third Optionr) to extend the Initial Term far an additional period often years (commencing on the firs( day following the expiration of the Second Extended Term and contirnting for a period often years thereafter); which extendM period shall be referred to herein as the "Third Extended Tent'. The Third Option may only be exercised: (1) by written notice ("Third Exercise Notice'D transmitted by the lessee to the Lessor at least 90 days prior to the expiration of the Second Extended] Term; (in if on the last day of the Second Extraded Term time shall exist no material uncured branch of this Final Lease by the Lessee; (M) if the Hotel has been comtmcted on the Promises, and (M if me Second Option was exercised. Within ten days of receipt of the Third Fxercise Notice and within ten days prior to the expiration of the Second Extended Term the Lessor shag advise the lessee, in writing as to the exiatevice (in the opinion of the Lessor) of any material moured branch of the Final Lease by the lessee; and the Page4MM Lessee, in each instance, shall be entitled tome the same prior to the expiration ofthe Second Extended Term. 5. The Lessor does hereby give and grant auto the Lessee the hr evocable right and option (the "Fourth Option") to extend the Initial Term for an additional period often years (mmmevcivg on the first day following the expiration of the Thad Extended Term and continuing for a period often years dissuader); which extended period shall be referred to herein az the "Fourth Extended Term". The Fourth Optionmayonlybeexercised: (I)bywrittennotice ("Fourth Exercise Notice") transmitted by the Lesson to the Lessor at least 90 days prior to the expiration of the Third Extended Term; (m if on the Iasi day of the Third Extended Term there shall exist no material uncured breech ofdus Final Lease by the Lessee; (Ion if the Hotel has bemmnstmaedmihe Wr ses;and(Mifthe Thud Optionwasexercised. Withintendays ofreceipt of the Fourth Exercise Notice and within ton days. Pruned the expiration of the Third Extended Term the Lessor shall advise the Lesson, in writing, az to the existence (m the opinion of the Lessor) of my material uncured breach of the Final Lease by the Lessee; and the Lesxee, in emb instance, shall Ed entitled to cure the same prior to the expiation of the Third Extended Terni Fm purposes ofihis Final Lease the tam "Term" shall be and mem the Initial Term and my and all of the Fust Extended Terns, Second Extended Term, Third Extended Tam and Fourth Extended Term as to which the appropriate option shall have been exercised by ted Lessee. ARTICLE TV - C0114FI1TATION OF ANNUAL RENTAL Lesson covenants to pay to the Lessor az ree al each and every year during the Term for the Premises the following amounts (collectively the "Rent") 1. Baseftent (A) Subject to the provisions of subparagraphs l(B), and (C) and (D) of Article TV hereof, the Lessee shall pay to the Lessor as rental for the premises the sum of 5319,200 per ammo; which domain shall be payable in 12 equal monthly installments each in the amossm of $26,600. (B) On each 5 year anniversary of the Commencement Date (commencing with the fifth annual anniversary of the Commrncemeot Date) the Base Rent for the now five years of the Term shall be adjusted as heraMelow, provided. Within 30 days following each 5"' year anniversary (commencing with the filth anniversary of the Commeacanent Date) the Lessor shall deliver to the Lessee the 0srtmt Value (an defined). WWdn30 days ofmomptby the Lesson of the Current Value the Lessee shall either (E evidence its agreement with the Current Value by written notice ("Concurrence Notice') [mnsmitted to the Lessor prior to the expiration of such 30 day period or (R) transmit a written notice disputing the Current Value (Dispute Notice"). If either (y) the Lessee transmits a Concurrence Notice or (z) the Lessee fails to transmit a Dispute Notice within such 30 day period, then and in efther such event the Base Rent for the lend five years of the Term shall be at an amount equal to the 6lx of the Current Value; the mmol and monthly payments described in subparagraph I(A) of Article IN shall be Page 5 a22 appropriately adjusted effective as of the fire day of such five year period; and any underpayment or overpayment shall be added to or deducted from the fast monthly payment(s) of Base Rem payable hereunder. B'the Lessee noisome a Dispute Notice to the Lessor within such 30 day period, then and m that the event issue ofthe determination ofthe current that market value of the Premises shall be wbmittedin arbitration in accordance with the provisions of Article = hereof; provided however that in reaching their determination of the then cousin fah market value of this Premises the arbitmons shall value the Premises as if the Premises were raw and unimproved land (exclusive of my improvements to, on or under such Premises). Upon receipt of the arbitrators award establishing the amount of the current fair market value the Base Rent for the next five years of the From shell be in an amount equal to 6% of the current fah marktt value (as detemdned by the arbitrators); the aomml annul monthly payments described in subparagraph 1(A) of Article W shall be appropriately adjusted effective an of the first day of the unit five years athe Term; and any underpayment or overpayment shall be added to or deducted from the next monthly paymeot(s) ofBase Rem payable hereunder_ For purposes of this Final Lease the term "Current Value" shall be and mean the fah market value of the Pre'ms computed as if the Premises were raw and unimproved land (exclusive ofaay improvements to, on or under such Pound sea C. If the Hotel Property is removed From the Premises and the Final Lease then and in that event commencing with the first calendar month f llowiug the date of such removal the portion of the Base Rem otherwise payable monthly by the Lessee m the Lessor an hereinabove provided shall be Proportionately reduced based upon the relationship of the Hotel Property (includingrelatedparkingandamenities,if )mthe Premises. Ifsubsequemtoitsremoval from the premises and the Final Lease the Hotel Property is restored to the Premises and subjected to the Final Lease Nen and in that event commencing with the first calendar month following the date of such restoration the portion of the Base Rent otherwise payable monthly by the Lessee m the Lessor as hereinabove provided shall be proportionately increased (as hereinabove computed). - D. Remshalibepaidm nthlyinadvanceoothefi tdayofeanhoadeverymomh. Lessee shall pay all reamis M1meinrequhed, without prim demand therefor, in lawful money of the United Statex at the address of the Lessor as set forth herein or a such other reasonable places as the Lessor may designate. Late payments shall be subject m an interest charge of one percent (t%) per month to the data of paymem. 2. Percentage Rem: (A) Subject to the provisions of subparagraph 2(D) of Article N, the Lessee shall pay to the Latour, with respect in each Annual Period (as defined) a portion of the Gates Slot Revenue actually received by the Lessee CTercenmge Renf) during such Annual Period (as defined) determined w follows: 3% of the first $50,000,000 of Grow Slot Revenues actually received by the Leasee during such Annual Period (as defined); 4% of Gross Slot Revenues between $50,000,001 and $70,000,000 actually received by the Lessee during such Annual Period (as defined); 5%of(iroae Slot Revenues between $]0,000,001 and $100,000,000 annually received by the Lessee during such Annual Period (as defined); and 6% of Goss Slot Revenues in excess Page 6 of 22 03-365 of$I00,000,000 actually received by the Lessee during such Arcual Period (as defined). For Purposes of this Final Lease the term "Anal Period" shall he and mean a 12 consecutive month period commencing (as to all but the first such period) on the fns: day following the end of the immediately preceding Annual Period; and as to the first such Annual Period commencing on the first day of the month following the month during wlslch all of the Phase IT Conditions shall have beensatisfied. Paymemofthe Percentage Rerawithrespmw each Annual Period shall be paid at the times and in the manner see forth in subpaegraphs (R) and (C) hereof (B) Within 30 days following the end of each of the 12 calendar months occurring during each Annual Period commencing during the Term, the Lessee shall pay to the Lessor that portion of the Percentage RrnS if any, applicable to such Anal Period determined as follows: fust, the Gross Slot Revenue received by the Lessee during the period commencing on the first day of such Annual Period and terminating on the last day ofthe subject month shall be determined (the "Cumulative Revenue Annual"); second, the amount of the Percentage Reat payable with respect to the Cumulative Revemre Amount shall be determined in accordance with the provisions ofsubparagaphs (A) and (D) Instead (the 'Cumulative Percent Rent'); third, all payments of Fernermage Read made by the Lessee during such Annual Period shall be aggregated ("Cumulative Payments To Daze"); and fourth, the excess, if any, of the Cumulative Percentage Rent over the Cumulative Payments To Daze shall be paid to the Lessor. ( C ) UwAh respect to my Anal Period during which Gaming Machines shall be in operation at the Premises the Cumulative Percevmge Read determined in accordance with the provisions of subparagraph (B) bereofis Ids than $1,000, ON then and On that event within 60 days following the end of such Annual Period the Lessee shall pay to the Legator the excess of $1,000,000 over the Cumulative Percentage Rent for such Annual Period. (D) If during the Term the revenue sharing payments required by the Maine Law mthorving Gaming Machine operation are increased or decreased by legislation enacted subsequent to the adoption of the legislation which initially authorized each operations, or otherwise (other than as a result of Capital Amio , as defined) then and in that event the percentages set forth in subparagraph (A) hereofudlized for determining Percentage Item in each Annual Period shall be adjusted by adding or subtracting, as the case may be, one-third ('h) of a percentage point for each one percentage point of change; so that if the revenue sharing obligation is increased by t%, then 1/3'" of 1% shall be deducted from each of the percentages set fonh in subparagraph (A) hereof. To the extarc that any each increase or decrease is expressed in dollar amounts instead ofpercmmgd then and in that event 1/3`s 101rofany such dollar amount increase or dormouse "I be applied as a credit or debit, as the case may be, to the Ldeee's obligation for Percentage Rent during each Anal Period. ARTICLE V - USE, OCCUPANCY L Lessee shag haw the right to use, road occupy the Premiss (including without limitation all Phase B improvements) fm any lawful business purpose including, without limitation, the purposes of operation of a hotel, funding (including without limitation Gaming Machines) and conference center, grandstand, harness rating track and stables and concerts Pape 7 mu 03-365 consistent with the terms and conditions of da Development Agreement. Except as herein expresaly provided w the contrary, Lessee shall, at all times during all but the first 6 months of the Term, operate a minimum of 1,000 For the maximum comber permitted under State law, whichever is less) Gaming Machines. Lessee shall operate its businesses conducted at the Premises in a reasonably businesslike, careful, clean and reasonably safe manner. 2. Lesser, through its agents, shall have at ad reasonable times the right, upon reasonable prior enured novfiwtion to the Lessee, to go on and impact the Premises, any buildings, structures or improvements thwecn, with as authorized representative of the Lessee and the right of access to utility systems located on the demised Premises for the purposes of maintenance, repair correction, or inspection For purposes of this paragraph, "reasonable notification" shall include any actual notification to the Leasee or its agent not less than one business day prior to the date of inspection. "Reasonable times" shall mean any time during Lessee's regular business hours, or during normal weekday business boors ifLessee shell cease opecationsorshallmaimainothwtba ore lmbusnesshours. Any such inspections shall be conducted in a manner which does not interfere with the privacy or confidentiality of the Lessee orits customers. 3. Consistent with the terms ofthis Final Lease,I.essce shall exercise sound business judgment, in the operation of its businesses at the Premises and consider the Lessor's rarommendatiore and advice. The Lessor's and Lessee's specific' responsibilities shall include, though net necessarily be limited an, the following' A. Neighborhood Public Relations and Protection. Lessee is mindful of the impact of harness racing, concerts and Gaming Machine activities on the immediate neighborhood and surroundingarea. Lessceagreestoadheremthefollowingguiddmes: (1). No live race shall start after 11:00 p.m. unless, due to an unforeseen emergency such as, bur not honed m, loss of power, loss of computer suppon to run the mutual mea facility accident, or loss of ambulance suppom races me delayed. In and circumstances, Lessee shall make every effort to accelerate post none and to finish operating M a reasonable how, in no case later man 12 midnight. (H). Lessee, in conducting Lessee's activities under this Final Lease, shall take necessary A" to prevent generation of excessive noise. For this purpose, excessive noise shall mean noise of volume, pitch or intensity likely to unreasonably disrnb the peace ofordinary occupants of residential properties surrounding the Bass Park Complex fm a material period of time. Lessee shall notify the Lessorofacryevent that embereasonably edticipmedm disturb the peace of ordinary occupavh of residential properties surrounding Bass Park and shall cooperate with Lessor to minimize the disturbance and/or the impact thereof. OR). Tothebest ofus ability, Lessm sh l ensure tbM horse trailers wW fwility traffic wiB comply with all applicable Lessor's rules and regulations. ARTICLE VI -LIABILITY AND PROPERTY DAMAGE IPISDRANCE Pa0e8M32 03-365 1. The Lessce shall provide and maintain the following inmranceduring the Term: (a) In connection with the employment of its employees, Lessee shall pay all applicable social security, unemployment, workers' compen ramal, or other employment taxes or contributions of inewance and shall comply with all federal and same laws and regulations relating to employment generally and to wages, social security, unemployment innamene and workers' compensation in particular. Lessee shall indemnify and bold hornless the Lessor from all costs, expenses, claims or damages resulting Goan any failure of Lessee to comply with these requirements. (b) Lessee shall procure and maintain comprehensive gmeml liability and automobile liability insurance on behalf of itself and the Lessor (as their respective interests my appear) against any damage, loss or liability or claims alleged to have arisen from the use or occupancy, by Lessor of the Premises. With respect to the required insurance, the Lessor shall be named as an additional iawred; be provided with awaiver of subrogation in favor of the Lessor, and shall be provided with thirty (3 0) days prim notice of cancellation or material change; and shall be provided, through the Office of the City Solicitor, wish cenificmes of insurance evidencing the above required insurance. Thecostcfmchinsurnmee"lbe paid directly by Lesser. (c) The summers of such coverage shall be no less then as the follows: _Type Amount 1. Workers' Compensation $1M combined single limit Statutory Employers Liability 2. Comprehensive Public $114 combined single limit Liability to include but with additional umbrella not be limited to the policy for not less than following: $Zed a) premises/opereGon b) independent contractor C) personal injury coverage d) product/completed operation e) contractual liability 3. Comprehenive Automobile $1M combined single limit Page 0 ton Liability coverage to include ocowage for. a) owned/mated automobiles b) non -owned automobiles c) hnedcars 4. Standard Form Fire or Replacement Value All Risk insurance Policy (d) Should Lessee desire, Lessor will entertain a request that Fre or All Risk Insurance be provided by the Lessor and shall be paid, on an agreed pro -ma basis, by Lessee for those periods in which Lessee occupies the Premises (e) Each insurance policy procured by Lessee shall affirmatively state that it will not be invalidated because the insured waived its rights of recovery against any party prior to the occurrence of loss. ARTICLE VQ- RAEARDOIIS K'ASTE 1. Lessee hereby covenants and agrees that it shall not, during the Term permanently place, cause to be placed, deposit or discharge any hazardous waste upon the demised Premises, or upon any other portion of Lessor's property, and further expressly agrees that it shall indemnify Lessor from any and all costs, expense or liability, ofwhmover kind or suture, incurred by the Lessor in detecting evaluating removing, treatmg disposing of or mhewise responding to any hazardous waste placed or deposited in violation of this paragraph I Lessee hereby covenants and agrees that 4 shall not. during the Term violate any local, state or Federal regulation, ordinance or statute pertaining to hazardous waste or hazardous material and further expressly agrees that it shall indemnify Lessor from my and all costs, expense or liability, of whatever kind or nature, incurred "a Lessor for any, such violation of this paragraph 3. Such costs shall be deemed to ftmudS without limitatiom Lessors costs ofdefending any and filed by any person, ergity, spacer, or governmental authority; paying any fares imposed in connection with such suit; paying any judgments or otherwise settling any damage claims; complying with any order by a court of component jurisdiction directing the Lessor to take remedial action with respect to such waste; and of all associated abomey's fres and costs_ 4. For the purposes of this Article, the term "hazardous; waste" shall be deemed to include every substance now or hereafter designed as a hazardous wastewater my provision of State or Federal law. Lessee's obligations orderthis Article shall be deemed to survive the mpvation or terndnion of this Lease. Page 10 al 03-345 1. General Indemnification - I.ewse shall defend, indemnify, and hold Lessor, and its inhabitants, officers, employees and agents completely harmless from and against any and all liabilities, losses, sums, claims, judgments, fines or demands arising by reason of injury or death of any person or damage to my property, including all reasonable costs for investigation mad defense thereof (including but not limited to attorneys' fees, cont casts, and expert witness fres), of my nature whatsoever arising out of or incident to the use, occupancy, conduct, or management ofthe premises or me arra m omissions of Lessee's officers, agents, employees, covtrecmm, subcontractors, licensees, or invitees, unless such injury, death, or damage is caused by the negligence and/or intentional misconduct of the Leasur and/or its agents or employees utilizing the Premises and/or poniom thereof by license as herein provided. The Lessee shall give to Lessor reasonable rotice ofmy such claims or actions. The Lessee shall also engage counsel reasonably acceptable to Lessor in carrying out its obligations under this Article. 2. Lessee's Waiver of Wor oad Compensation Immunity- The Lessee hereby expressly agrees tom h will defend, indemnify and hold the Lessor, its inhabitmts, officers, employees and agents completely harmless from my and all claims made or asserted by the Lessee's agents, servants or employees arising out of the Lessee's activities under this Final Lease; provided however that Temat's aforesaid indemnity and hold harmless agreement shall not be applicable to my liability based upon the negfigence and/or intentional misconduct of the Lessor and/or others utilizing the premises and/or portion therwfby licenses herein provided. For this purpose, the Lessee hereby expressly waives my and all immunity it may have under the Maine Workers Compensation Act m regard in such claims made or asserted by the Lessee's agents, servants or employees. Subject to the limRatiws huranabove set forth, the indemnification provided order this paragraph shall extend to and include any and all wets incurred by the- Lessor to answer, investigate, defend and settle all such claims, including but not limited to the Lessor's costs for attorneys Ices, expert said other witness fees, the cost of investigators, and payment in full of my and all judgments rendered in favor of the Lessee's agents, servams or employees against the Lessor in regard to claims made or asserted by such agents, servants, or employees. 3. The Lessor shall indemnify,defend, and hold harmless the Lessee from and against all claims and actions, and all expenses incidental to such claims or anions, based upon or arising out of damage to property or injuries to persons or other tortiom acts caused or contributed in by the Lessen or anyone acting under its direction or control or in its behalf in the course of the Lessor's activities under thia Initial Lane and/or others utilizing the premises and/or portions shared pursuant an the license granted to the City, provided that Lessor's aforesaid indemnity and hold harmless apeameam shall net be applicable to my liability based upon the negligence and/or unabated misconduct of the Lessee or anyone acting under its direction or control or in its bebalfin the course of me Tenant's activities under this Final Lease. 4, The Lesarr hereby expressly agrees then it will defend, indemnify and hold the Leasee harmless from my and all claims made orassertedby Lessor's agents, serverds or employees arising out of Lessor's activities under this Final Leese; provided however that Lessor's aforesaid indemnity and hold humless agreement shall not be applicable to my liability based Page 11 of 22 03-365 upon the ungligmw and/or intentional misconduct of the Leasee or anyone acting under its direction or central min its behalf in the worse of the Lessee's activities under this Lease. For this purpose, Lessor hereby expressly waives any and all immunity it may have under Maine's Workers' Compawastion Act in regard un such claims made or asserted by Lassoes agents, servants, or employees subject to the limitations hereinabove set forth. The indemnification provided ander this paragraph shall extend to and include any and all costs incurred by the Lessee to aeswer, investigate, defend and settle all such claims, including but net limited to the Lessee's costs for attorney foes, expert and ober witness fees, the can of investigators, and payment in full of any and all judgments rendered in favor of Lager's agents, servants or employees against the Lessee in regard to claims made or asserted by such ageam, servarus, or employees, ARTICLE M -DAMAGE BY FIRE OR OTRER CASUALTY Lessor agrees that in the event of destruction of or damage by fire or other casualty to my improvements situated on or under the Premises( spective of whether owned and/or operated by the Lessor or Lessee), orto any part thereof and as often as the improvements shall be damaged, by fire or mher casualty, Lessee shall have the right but not the obligation to rebuild and repair the improvements for occupancy. IfLessee elects not to rebuild and repair, it shall so notify Lessorwithiv siary(60) days or more expeditiously if possible of its decision. Lessor shall than have the option should Lessee have elected not to rebuild or repair as; aforesaid, to (a) terminate this Final Lease if the damaged or destroyed and not rebuilt improvements are either the Facility or the facility in which the Gaming Machines are operated or (b) in all other cases remove that portion of the Premises an which such improvement was situated from this Final Lease (without abatement of rent) and m cause lessee to demolish all Effected Structures (as defined) to ground level, remove all foundations and to remove all debris from said demolition from the demised Premiseslame event Lessee decides to rebuild and repair said damages all destroyed or damaged improvements shell to the extent of available insurance proceeds, be restored to their use and condition prior to said fire or other casualty, or shall be constructed in accordance with plans approved by the Lessor, which approval shall not be umeasombly withheld or delayed. Any insurance proceedswbether received by or payable to the Lesor or Lessee shall in any event, be paid to and retained by Lessee, subject so application by the Lessee to magovation, repay or rewnstmction as hereinabove provided. For purposes of this Find Lease the term "Effected Stmctures" shall be and mean stmcmres erected by the Lessce on the Premises and which have been damaged and/or destroyed by fire or other casualty. ARTICLE X -RULES, REGULATIONS AND LAWS The Lessee hereby agrees and to cause all personnel employed by the Lessee to obey, all municipal ordinates, and all State and Federal rules, regulations, or laws. ARTICLEXI-TAXES Page 12 or 22 03-365 1. Subject to the provisions of Paragraph 2 of Article M hereof, the Lessee agrees to pay, when due, my coal all totes and/or assessments, fees or charges of my kind wbatsoever, as may be imposed during the term hereof, or my extension of the tam of this lease, by eery governmental authority upon the demiaedpromises, including Lessee's leasehold interest therein, any strommes, or improvements thereon, or any personal property located thereinr It is expressly agreed that such tares and assessments shall include all amounts levied as real estate totes upon thedemiwdpremisesbythe Lmwracfi gi itagovermnenmlrapacity. Lesseefurtherhereby waives any and all rights or privileges ofexemption from taxation on the demised premises, m Lessee's leasehold interest therein, or on any buildings, stmamm, or improvements thereon, or on any personal property located therein arising due to public ownership of the demised premises by the City ofBangor; provided, however, nothing herein shall in any way prohibit the Lessee from exercising its rights under the law on contest the amounts of such taxes, assessments, charges or fees. 2 Anything in Paragraph 1 of Article M hmeofto the contrary notwithstanding(A) Lessee's obligation to pay personal property and real estate mus under the Final Lease shall be based upon the current assessed value of the real property and the current improvements; (B) Upon the constme rion of any of the Phase B Improvements the assessed value of such Phase B Improvemerds shay be determined by the City Assessor in accordance with assessing standards applicable to privately owned Property applied on a consistent basis and on a basis consistent with prior practices; and (C) Should the Lessee disagree with the current assessed value established by the City Assessor, from time to time, Lessee shall have the same rights to challenge and appeal any such assessmem(s) as applicable to privately owned property; aM for such purposes the Lessee shall be treated in the same mariner as any other owner of private property in the City. ARTICLE %II— NOIIDISCRphIDlATION Lessee for itself, its personal representatives, successors in interest and assigns, and as part of the considerations hereof, does hereby covenant and agree as a covenant running with the land that (t) no person or group of persons shall be excluded oo the grounds ofmce, color, or national origin from participation in, denied the benefits of or be otherwise subjected to discrimination in the use or occupancy of said demised Premises and (2) lu the construction of all improvements, buildings, structures, on, over or under such land and the finishing of services thereon, no person or group ofpersons shall be excluded on the grounds ofmce, color, or mationd origin from participation in, denied the benefits of or be otherwise subjected to udawfirl discrimination. ARTICLE S[O- COVENANTS OF QUIET ENdOYdIENT The Lessee, subject to payment of the Base Pont and Percentage Rem, and observing, keeping and performing all the tams and provisions of the Find Lease on its part to he observed, kept and performed, shall lawfully, peaceably and quietly have, hold, occupy and enjoy the Pape 13 m22 03-365 demised Premises duringthe Term hereof without hindrance or rejection by the Lessor or aw other poseurs. ARTICLE XIV -LIENS The Lessen and the Lessee agree that each will promptly discharge (either by payment or by filing of the necessary bond orotherwise) any mechauce, materialmen's or other Bess against the demised Remises, any buildings, swerves or improvements thereon, which Gens may mise out of any payment due for labor, services, matenals, supplies or eyuipmem which may have been furnished is or for the Lessen or the Lessee, respectively. ARTICLE XV - TTTLE TO BUILDINGS, STRUCTURES, AND IMPROVEMENTS Title to the buildings, umcWres and improvements corawmed on the demised Remises by the Lessee either prior to or during the Term (collembady the "Tenant Improvements") shell be in the Lessee, and during such Term, the Lessee shall have the right, a its sole enper eq to demolish and remove, improve or cher any and all Team Improvements and other personal properly erected or located on the demised Premises. - All such Tenant Improvements shut conform to the Development Agreemece and the Phase IT Water Plan development pursuant themo Lessor shall retain title to all building, structures, improvements, facilities and installations currently on the Premises, including the grandstand and track. Any proposed physical changes to any existing buildings, structures and facilities owned by Lessor shall be made in accordance with the burns and conditions of the Development Agreement. ARTICLE XVI- REMOVAL OF PROPERTY 1. Upon the tmwnalion or expiration of this Final Lease and/or the expiration of the Tern, the Tenant Improvements and ether personal property erected or located upon the demised Premises by the Lessee during the Term shall remain the property of the Lessee (except any improvements m buildings, structures or installations of Lessor existing at the time of that exeurtion adds lease), mal the Lessee shall have the right to rmwe the same from the demised Remises within stay (60) day's following the date of termination of this lease or expiration of the Term Any such property not an removed within said sixty (60) days shall become the property of the Lessor to be disposed of in such a way as the Lessor may deem &. In the event the Lessee ehcm an remove all marry ofthe Terence Improvements and/or other personal property, the buildings and land appurtenant to the Tenant Improvements so reserved shall be ren rad to as near as possible to its condition as mthis commencement of the Final Lease, ordinary wear and rear excepted. Pale 14 of M Oa U!i 2. In the evera Lessee shall fail to remove any Tenant Improvements or personal property within sixty (W) days from the date of termination or final ep'iration of this Lease, Lessor shall, subject to the terms and conditions of my written agreement executed subsequent to the date hereof by the Lessor end Lessee with respect to my such Tanam Improvements, be entitled to recover from the Lessee Lessor's reasonable costs incurred in removing or disposing of such Tenant Improvemems or personal property. In such event, there shall be fathered from Lessors costs the fair value actually realized by the Lessor 6om the sale, use or other disposition of the Tenam Improvements or personal property concerned. ARTICLEX-SITFtFVR h:R OF POSSESSION Subject to the provisions contained nt Article XVI, the Lessee shall, upon the termination of this Final Lease or expiration of the Term, surrender the quiet and peaceable possession of the demised Premises. ARTICLE X VOI - TERIYDNATION It is coverunted and agreed that subject to the provisions of Articles X and =hereof. (1) Ifthe Lessee shall neglect or fail to pay the Base Rent and/or Percentage Rent or other charges payable hereunder and such default shall continue for a period of thirty (30) days after written notice thereof by Lessor; or (2) If Lessee shall neglect or Gil Wperform or observe any of the other covenants, terms, provisions, or conditions an its panto be performed, or observed, and such neglect or failure shall con inre for a period of thirty (30) days after written notice thereof by Lessor, or if such covevams, terms, provisions or conditions cannot be performed or observed within said thirty (30) day period, if Lessee Gds to commence to cure my such neglect or failure within such 30 day period and/or thereafter fails to diligently prosecute the curing of such neglect or failure; or (3) If the estate hereby created shall be taken on execution or by other process of law; or (4) If my general assignment shall be made of the property of the Leser for the benefit of medncra; or (5)ff a receiver, pardon, conservator, ortrustee, in bankrancy or other similar officer shall be appointed W take charge of or any substantial pan oftlse Lessee's property by a Count of competent jurisdiction and the same shall not be discharged within 90 days written notice from Lessor Thea in my oftbe said cores, the Lessee (hW dually "Evem ofDefcult" and collectively "Events of Default') may be considered in default hereunder, and the Lessor lawfully may, immediately or m anytime thereafter, during which any, such Event ofDefault shall outdone to eta and upon 10 days prior written notice to the Lessee ("Lessee Default Page 15 of 22 03-365 Notice") eater into and upon she said Premises or any part thereof and expel the Lessee and .these claiming through or under it and (subject to the provisions of Micles XV and XVI haeot) remove its ortheir effects (forcibly, if necessary) without being deemed guilty to my manna of trespass, and without prejudice to arty remedies which Lessor might otherwise have. Uprnsuch army, this Final Lease shall terminate, provided however, that if the Lessee shall contest the occurrenw of my such Event of Default by written notice to the Lessor transmitted within 5 days of receipt of the Lessor Default Notice, then and in that event (a) the issue of the oceurtence of the Event a Default set forth in the Lessor Default Notice shall be submitted to arbitration in accordance with the provisions of Article XXXI hereof (b) the Lessor shall not be entitled to ra- wata the Premises and/or remove the Lessee and/or my of its property and/or myon claiming through or under the Lessee and/or Forstmann the Final Lease unless and until the award of the arta rmom shall find that the Event ofDefmIt described in the Lessor Defmh Notice in fart ocmmed and/or exists and (c) rural the award of the arbitrator is rendered [Imre shall be no abatemmt of read Ifthe Final Lease shall be terminated as heremafla provided, the Lessee shall be liable to pay as reel, amounts equal to the several installments of Bass Rent anal other charges reserved as would have become due under this Final Lease if this Final Lease had net been termintedorifthe Lwsorbadnotemaedorreentaedmffaremid. NorwithsmrWi�the foregoing Lessee's liability shall not exceed the difference, if any, between the Base Rent which would have been due had there been no such lamination, and the amount being received by Lessor as rent from any naw taant oroccupmt of said Premises. In orderto mitigate Lessee's damage heremMer, Lessor agrees to make every reasonable effort to secure subsequent Wood s, at a rental at least equal to the than prevailing local rate for rhe dmtsed Premises. ARTICLE XIX -ATTORNEY'S F'EE 1. The Lessee shall reimburse the Lessee for reasoable=="'a fees mcurted by Lessor in the evem the Lessor employs an anemey to collect my ram due hereunder and secures a judgment in connection with collection of said rent, or legal process is levied upon the interest of the Lessn in [Itis Lease or in said premises, or in the evert Lessee violates my of the terms, conditions or covenavm on the pm of the Lessee -herein command, if, but only if Lessee fails to promptly correct the violation ofmyhear, cundiman or covenant after receipt of notice that it is in violation thereof. 2. In the event Lessor employs its City Solicitor or an assistant solicitor ho collect rets or otherwise protect Lessor's interests under this Lease, "reasonable attorneys foes" under this Micle shall menu the reasonable cost of services provided by Lessons Solicitor or assistant solicitor, at the rate charged for smdlar services by private mtomeys in the Bangor area. ARTICLE XX-ASSIGNM1IENT, SALE AND SUBLETTING I . Subject to the provisions ofPmagraph 2 oftlts Micle XX and Article XXl hereof the LesseeshallsotgmytimenssiMsell,conveyortrmsfathisLnworartyina therein, or sublease or sublet or was the premises, or any pmt thered( without the prior written consent of the Lessor which consent shall not be umeasenably withheld, delayed or conditioned; Page 16 of M k 03-365 provided however, that the consent of the Lessor shall not be required to a sublease or assignment is the event that the Lessee loses and/or does not obtain all required Gaming Permits and/or five racing licenses and/or owing dates and such sublessee or assignee (a) hes secured all required Gaming Permits and/or five racing licenses and racing dates and (b) has provided, or - provides provides to the Lessor all removably requested information with respect to its financial condition and principals. lathe event ofan approved orpermitted assignment or sublease, all provisions of etas Final Leas shall extend to, bind and inure to the benefit of not only the Lessor and Lessee but also their sumessm and assigns. 2. Lessee shall have the right to assign this Lease(a) to BHT or(b) to my corporation with which it may have become merged, consolidated, or otherwise associated, or any corporation or holding company having the controlling interest in the Lessee, or to any, corporation which may be a subsidiary of the Lessee. In no event, however, (other them in the event ofan assignment of BHT), shall the Lessee named herein be relieved from any obligations under this Lease by value of my assignment or subletting. "TIM KICI- 1. Leesorismgn =ofthencedofL sseewo mcetMwnkmc onofequipping and/or furnishing buildings, structures and improvements on the demised Premises, and therefore specifically agrees to permit the Lessee to mortgage, conditionally assign or transfer its leasehold interest in the Final Lees and/or denasd Premises for the purpose of obtaining equipment, constmctioo and permanent loan financing for the construction, equipping and/or burnishing of said buildings, swctures, and improvements, provided: (a) The term of such mortgage, conditional assignment or transfer (collectively "Financing Encumbrevces") shall not ectad the duration of the Initial Term phis the First Extended Term and Second Extended Terry hereof; (b) Lessee shall give notice to the Lessor of the existence of arty such Financing Encumbrance, together with the name and address of the mortgagee, assignee or transferx and a rely, of the mortgage, or any such Financing Encumbrance, (c) That in the event of foreclosure of my such Financing Encumbrance, and in the event that said mortgagee, conditional assignee or transferee (or its respective tmmlicam, successor or assign) shall become the comer of the Lessee's interest in the Final lease and/or the Premises pursuant to such foreclosure, said mortgagee, conditioned assignee or transferee (or its respective haysferee, successor or assign) shall have the right to take possession and shall become the legal owner and holder of the Final Lease and the lease -hold estate created hereunder and shall hold such estate upon the same teens and conditions as held by Lessee from which such mortgagee, conditional assignee ortransferee (or its respective transferee, successor or assign) acquired possession, but in such event, said mortgage, conditional assignee or transferee (or its respective tmasferee, successor or assign) shall be liable under the terms and conditions hereof during the period of time during which said mortgagee, assignee or transferee (or its respective transferee, successor or summ) holds such estate, and for any defaults under the terms or conditions hereof Page 17 of 22 03-345 which arose before said estate became vested in said mortgagee conditional assignee or transferee (or its respective transferee, successor or assign), however, that such mortgagee, conditional assignee or bansbcwvc (or its respective transferee, successor or assign) shall act be liable for demult(s) of the Lessee occurring prior foreclosure unless Lessor pmvided written notice of such default(s) to the mortgagee, conditional assignee or transferee (or its respective transferee, successor or assign) before the effective date of the foreclosure action. (d) That the existence of my each Financing Encumbrance, or any foreclosure thereof shall rent relieve the Lessee from any liability or responsibility of the obligations on is part to be performed. (e) The Lessor agrees that it will not exercise its right to terminate this Lease in the event of any default unless such mortgagee, conditional assignee, or transferee has he given (1) wrinm notice of the Lessee's failure to cure the defmlt and (2) an opportunity to ave such default (of at least equal duration as the time provided for the Lessee to cure such default under the terms of this Final Lease), or alternatively, m the election of such mortgagee, conditional assignee, or transferee, the period of time as necessary to allow the Lessee's interest herein to be foreclosed, provided that such mortgagee, conditional assignee, or hansferee shall be liable under the terms and conditions hereof during such period, as provided in subparagraph ® of this article above. Lessor's obligation to give notice under this section shall indeed only to those mortgagees, conditional assignees, or transferees know to the Lessor as a result of notice given by the lessee m accordance with subparagraph (b) of this article above. (1) Any such mortgagee, cerditioml assignee, or transferee succeeding to the Lessee's moment herein shall have the right to assign or sublet the premises as provided in Article . ARTICLE XXR-AUMOR TO ENTER INTO AGREEMENT 1. The Lessor hereby represents and warrants that it has taken all necessary procedural and legal steps as required by federal, state and local laws and regulations for the purpose of authorizing the execation of this Final Lease and that execution of this Final Lease by the City Manager readers this Final Lease a valid and binding document on the pan of the Lessor and the same is folly enforceable in all of its terms and conditions by the Lessee. 2. Lessee hereby represents and warrarns thatit has taken all necenery procedural and legal steps as required under all state, local and federal laws and regulations, and a0 necessary corporate action to authorize the execution ofthis Final Lease by its undersigned corporate officers and that upon each execution this Final Lease is a valid and binding document on the part of the Lessee and ti fully enforceable in all of its terms and conditions by the Lessor. ARTICLE XtiIO- WAIVER Failure on the part of either party hereto to complain of any action or non -action on the part of the other party no matter how long the same rosy continue, shall never be deemed to be a Page 18 of 22 O}U5 waiver by any of such party of its rights hereunder. Further, it is covenanted and agreed that no waiver a any time of any of the provisions hereof by either party hereto, shall be construed as a waiver of any other provisions hereunder, and that a waiver at any time of any of the provisions hereof shall not be conetmed at my subsequent time as a waiver ofthe same provisions. The approval of Lessor or of any action by the Lessen requiring the Lessor's consent or approval shall not be deemed to waive or reader unnecessary the Lessor's consent or approval ofaay subsequent similar act by the Lessee. .l atl:x.41 to YM. Notices to the Lessor provided for in this Lease shall be sufficient if hand delivered, delivered to a reputable overnight delivery service or sem by registered or candied mail, remm receipt requested, postage prepaid m: Edward A. Barrett, City Manager City of Bangor City Ball n Rmiow Sunt Bangor, Maine 04401 Notices; to Lessee shall be sufficient if hand delivered, delivered to a reputable overnight delivery service or sent by registered or carolled mail, return receipt requested, postage prepaid, addressed to: Capital Seven LLC 1055 E. Tropicana Avenue, Suite 700 Las Vegan, Nevada 89119 With a copy to: Martin I. Gersten, Esq. Freedman & Germt ,LLP 90 Birch Bill Road Newtown, CT 06,170 or to such ether respective addresses as the parries may designate to each other in writing from time to time. ARTICLEX V- INVALIDITY OF PARTICULAR PROVISIONS If any term or provisions of this Final Lease or the application thereof to any person or c'nwmusumes is hereaBer determined to be to my extent invalid or unenforceable, the remainder of this Final Lease or the application of such terms and provisions to persons or chcaunstances other them those to which it is held invalid or unenforceable shall not be affected hereby and such Page t9 my 03-365 term and provision of this Final I.ease shall be valid and be enforrcenbleto the fidlest extent permitted by law. ARTICLE XXVT-CONST![UCHON The headings appearing in the Final Lease are imended for convenience and reference only, and not to be considered in cantering this Final Lease. ARTICLE Xlt"- NO PARTNERS= OR JOUST VENTURE CREATED Nothing contained hanin shall be deemed or construed as everting the relationship of principal and agent or of partnership or ofjoim venture between the parties, it being understood and agreed that neither the method of computation of rent nor any other provisions contained herein nor any acts of the parties shall be deemed to create any relationship between the parties other then the relationship of landlord and recant. ARTICLE XX VDT -COVER GLAW This Lease shall be governed exclusively by the provisions hereof and by the laws of the Stan a Maine, as the same may from time to time exist. ARTICLEX - MEMORANDUM OF LEASE The parties agree not to record this lease; however, upon request of either, the other shall prepare and execute a Memorandum ofUase in a form suitable for recording at the Penobscot Maine Registry of Deeds, as evidence ofUssce's fi mest in the Premises demised herein ARTICLE XXX -AMENDMENT TO LEASE The Final Lease and the Development Agreement combat all the terms and conditions between the parties hereto and no alteration, amendment or addition hereto shall be valid undess in writing and signed by both parties hereto. ARTICLE XXXT-ARBITRATION Any and all disputes and controversies arising oat of or relating to this Final Lease and/or the Development Agrcement shall be submitted to and settled by arbmation to be held in the City of Burger, State of Maine in accordance with the roles and regulations ofthe American Arbitration Assromionthenobtaming. Such arbitration shall be heldbefore three arbitrators; one ofwhom shall be designated by the Lessor; one ofwhom shall be designated by the Lessee; Page n can O3-345 and one of whom shall be designated by the other two arbitrators. Thedeeisionofamajorityof the arbitrators shall be binding; any award may include the reimbursement to either party of fees, costs and expenses incurredin transition with such arbitration; and such award may be enforced in any court of competent jurisdiction ARTICLE %YETI -PASSAGE ANI) EASEMENT Each of Lessor and the Lessee hereby grant to the other a right of passage and easemem over its respective portions of the Baas Park Complex for purposes of access and egress to the ermine Bass Park Complex. Without Harting the generality of the foregoing, the Lessor, its employees, agents, screams and invitees shall have the right to enter onto the Premises m all reasonable times with personnel, vehicles and equipment for the purpose for the purpose of maintaining, repairing and replacing the ivf structure, utilities and appurtevam structures thereto. IN WITNESS Wf1EREOF, the parties hetero have set their hands and seals the day and year written above. WITNESS: WITNESS: x CITY OF BANGOR CAPITAL SEVEN, LLC (By) Name: %aw" scoi+ Title:. Ids Pape 21 of U R 03-365 STATE OF MAPLE PBNOBSCOT, ss October 1 11 2003 Than personally appeared the above-named Edward A. Barrett, CityManger ofthe City of Banner, and aclmowledged the foregoing instrument to be his free act and deed is his said capacity, and the free act and deed of said body corporate. Before me, PinL.C'etay Notary Public/ AttnrriryaHaa TEMNIL. MR" ., NOrgRY PUBLIOI MFWE MY CONNISNA M EIIPIRE90EeEWER 1% ROW STALE OF Haw O:1 t ,,. 4 4ianaWlss October 2, 2003 Than personally appearad the above-named Shawn Scott, Mew la4K of Capital Seven, UC, and acknowledged the foregaing instmmern to be his free act and deed in his said capacity, and the free act and dead of said body corporate, Before me r \KUuruirr�4 S� W..... ••Oa �� N .#OTA* blid Attom ey-at-law Yall KUWq " Expiration Oam: June 3, 20115 I/Ougaa'mrFoulask" Pape M of 22 03-345 INDENTURE OFFINAL LEASE THIS INDBIdfM OF LEASE, executed asofthe 14 day ofOctuba, 2003, by CITY OF BANGOR amumeipal capossecatorgaoi ed and existing under and by virtue of the laws ofthe State ofMaiog and having its pdwpul offices m T3 Hadow Street, Bangor, Maine (herelvafler referral to as "Lessor"): Mie CAPITAL SEVEN, LLC, a limited liability company organized and existing under the laws of the Sole ofNevads, and having a regular place of business in Las Vegas, State of Nevada (hoarea8er sometimee referred m as"Lessee') WITNESSETH: WHEREAS, the Lesser is the ovmar a improved real property womanly keOvae as Bass Park treated on Dutton Street in the City of Bangor, Corona of Penobscot, Soo of Maine; and WHEREAS, the Lessor and the Lessee have this day entered into a Development Agreement hhe'Devaopm mt Agreement", the deBwtions ofwhich are hereby incorporated herein by refermw) with respM to the rtlli ation and development by the Tenor of portion of Baas Perk; end WHEREAS, simuhaneca stywith the execution hereo[ the Lesser and Lessee have execuod the Initial Lease with respect to a portico athe Premises (as therein defined); and WFfREAS, this badentme of Final Lease ("Final Lease) with respect to a portion ofBass Park is being executed prmimnt to the terms and conditions ofthe Development Agreement and is the agreement ofleess referred to o the Developman Agrcement as the "Final Lesu". NOW, THEREFORE, W CONSIDERATION of the premises and the mutual promia", revenama temu and conditions contained in this Final Lease the parties do hereby Was as follows: 03-365 ARTICLE]-PREbDSES 1. The Lessor, for and in consideration ofthe rents m be paid and the obligations to be performed by Lessee as hereinafter provided, does hereby demise and teaseuvto Iessea and the Lessee does hereby take and she from the Lessor during the Term (as defined) and, upon and subject to the terms sed coMitions hereinafter expressed, the premises designated by =as bombing in the sketch arrested hallo as Hffiibit"I" together with all improvements ounces, thdeon and/or theramder summed, au in its present Physical condition (collectively the "Premises'). 2. Anything in Paragraph l of Article f hercifto the coMmry (A) IT(A) 0 ofthe Developmem Permits shall have bceo Silly and timdyiamed with respecter the wvsNscnon of 100 suite hotel athe area indicated on the Phase H Master Plan (the'7lotd"), and (H) the Lessee shall not have commenced c0nmruchm of the Aotel within the firm to naw of (y) the etpirntiov of the tied year ofthe basial Term (as defined) of the Find Lease, or (z) the expiration of one year after the conclusion of the fust Mender year during which Gaming Machines operated by the Leasee mthe Premises generate S60 million in with apripor Orme reduction in Rase Rest (as define/), a herein provided The Lessor may only searches its Removal Option upon 30 days prior written nonce to the Leasee during which period cure (in the form ofcommencemem ofconsmrcnm ofihe Hod) shall be permitted. R the HotelPropertyuremovedfrom[ Final Lmseputeuantmthe«aniseofthe Removal Option. the Lessen shill make 0 good faith efforts to lease or sell the Hotel Property for the development of aHotd by an independent hard developer (IndeperMem Developer"). For proposes of this Fuel Lease as term "Gross Slot Revenue" shall be and mean money or medics insermd in a Graining Machine mines money or credits or poet paid am to wieners. (B) Ifthe Lessor shall not hew an executed agreement with an independent Developer which is m full force and effect as of the expiation of 36 months following the removal of the Adel Property from the Fred Lease Protestant to the exercise of the Removal Option, thea and in that event the Ezxsor may use the Add Property for any purpose (other than the operation of a Track Aachen and/or Gaming Machines) that is appropriate and consisteet wish the overall use ofBass Park Mulling the Phase H Masten Plm; provided however, that immediately following the up'vation of such 36 month period the Lesser shall advise the Lessee in writing of the absence of such an executed agreement (the'Temor Notice") and the Lessee shall have the right and option (the "Recovery Option") exercisable upon 60 days Prior written notice ba the Lessor transmitted within 60 days offlue receipt of the Lessor Nonce to cause the Lessor m subject the Hotel Property in the Final Leese subject only, to the i.essor and Lessee reaching agreement upon the development and use of the Held Property. In the avers that the Hotel Property is retraced aM subject rethepiin the ease, the Bae¢ gent shall be tummy nto the same summer that it would hew thenen iamesthe Find Leas ehadthe Hotel Propertyrot been removal from the Premien. In the event the lessor and Inas do rot reach an agreemev[ as to Page2d22 the development and use of the Hotel Property sed the same is int reduced and subjected to the Final Lease as aforesaid, that and in thin eve( the Lessee shall have the right of fast refusal ("First Refusal Option") to acquire and develop the Hotel Property exercisable m my time that the Lesser receives an of from athbd party acceptable to the Lesser in its sole discretion for Noma?) oma? ofitofthe Hda Propssty. Lessorosa0 give lessee sof notice("Ahm+tive Notice")ofitarecap[offsaceepb proposalwithin30daysptim ordcHoWngthat such pmpoeat is acceptable. BLessx mmdxsmch shall ¢real Optlmdedthe HmelPmpertyis cowered andsubjected conditions Finn Lease, Lessee shellbe third arts and said property cin the sametasteandlove ooa(bedbeen offeredby arrhe thud pattyend the Base Rent shall be within ed ( hereinabove provided. Lessee most eaercise this omtR bars Option, u visiting, within ddrly (30) days ager receiving the Altemetive Notice from the Lessor. ARTICLE R—LICENSE 1. Subjem s byh terms, for theo( and li ofthe va ith StmeF irthe m theDeelopent Aigesmethe City £prom¢operstim ofrhe Barbourain Fahentbrth th the Development Agreement (which proviaom are incorporatedetesso herds ra rehermx) the Lessee does hereby ®ant a lice(" (the `License 7 p the Lessor to operate the Bangorhat p Fav duringshe Term (eredefined)an[batporton onsu stand it end during that pviod oftime aorto exceed fmsrteev (14) days and m mbsmntidlythose dazes (uriliud by tate Stere Fair dating 2003. 2. The Lessee shall have the right, exnassble in its sole and absolute discretion, and upon 24 months prior writtm notice to the Lessor to terminate the License; provided however that m the time of the termination of the License add as a condition precedent thereto the Lara shall pay to the Lessor the sum of 51,000,000.00 to be utilized by the Lessor to defray costa related u the relocation of the Banger Stare Far. UMM le IFP-T,77TI 1. TOH W AND TO HOLD the demised Premises umo are I.usee fm atm( (the "Toitid Tend-) wmmem:ivg on are Commencement Dace (( defined) and continuing for a period often years thereafter. For pumoaesofthis Final Lease the term (a)"Commancemont Date" shall be and mem the first day athe first calendar month following the data upon which both of the phase B Conditions in defined) are smelled; (b)'Th(e H Conditions" shall be and mean each and both of (1) the receipt by the Lara of 0 necessary emitkmems, permits and approvals (collectively "Operating Permits") for the operation at the Premises of least 1,000 Gaining Machines (m the mmdmsm smosm permitted by State law), and (m the comniatcement by Lessee ofCommeraal Operation (( defined) of Gaming Machu( m the Premises: (c) "Commercial Operation' shall be and mean the installation of least 250 Gamin Machines; and (d) "Enabling Legialation^ shah hand main a law adopted by the LegisleAve of the Sine of Maine and/or by public referendum authorizing the insmllatum and operation of Gaming Machines at the Pm 'xs. I.mxe shall (a) within 45 days following the adoprioo of Enabling page 3 of n O3 34s Legislation apply for all Opmadi Permits and subsequent to snob filing, diligently prosavte such filings and (f) conscience Commercial Operation of Garunglobachim within 6 months after receipt by Lessee of all necessary Operating Pamirs and all Development Panama requited in connection with the construction, ocaspancy and use of my facility renovated and/or rnvatrucred for the operation of Gaming Machines at the Premises. 2. TMLessmdoesherebygiveand graatuawtheLesscethe irrevocable right and option (the'Tim Option') to extend the Initial Tam for an additional period of ran years (commencing on the firs[ day following the expiration of the Initial Term and continuing for a period often years thereafter); which exceeded period shall he referred to herein as the "First Extended Tam". The First Option may only be exercised: (I) by written noice('Tist Exercise Notice') transmitted by the Lessee to the Lessor at least 90 days prior to the expiation athe Initial Tam; and (D) if on the laid day of the Initial Tcmi there shall exist no material uncured breachofthis Fusel Lembythe Lessee. Withi mdaysofmceiptofthe Firer ExaciseNotice and Within ten days prior to the expiration of the Initial Tam the Lessor shall advise the Leasee, in writing, as to the existence (in the opinion of the Leswr) of my material==ad breech of the Final Lease by the Lose; and the Lases, in each instance, &hall be entitled in cure the same prior be the ap'vation of the Initial Term 3. The Lessor does hereby give and grant unto the lessee the inevoable right and option (the `Second Option') to sound the Initial Tem for an additional period of ban years (comm arcing on the that day following tin: expiati= of the First P,xtmdeA Tem and containing for a period of teni years thereafter); which extended period shed be referred to herein a the "Second Exceeded Tam", The Second Option may only be exercised (1) by written notice ("Secand Exercise Notice") tranemiced by the Leas« to the Lessor at least 90 days prior to the expiration of the First Extended Term; (l) if on the last day of the First Extended Term there shall exist no material uncured breach of this Final Leave by the Losses; and (Do if the Fist Option was ettrcised. Within can days of receipt of she Second Exercise Notice and within tie days periodin the expiration of the Fins Exceeded Tam the Loeser shall advise the Lasa, in writing as to the existence( the opinion tithe Lessor) of my materia uncured breach of the Final Lease by the Lesser; and the l.essoe, in each instance, shall be entitled to sue the same prior to An, expiration of the First Extended Tam. 4, The Losaor does hereby give and grant unto the Losses theumocable, right and option (the'Thid Opfi=") to extend the bwtmI Term for an additional period often years (commeocing on the first day following the expiation of the Second Extended Tam and continuing for a period often years thereafter); which exceeded period shall be referred w herein as the"Third Extended Tam". The Third Option meq only be exercised: (t) by written notice ("Third Exercise Notice") transmitted by the Lessee to the Lessor a least 90 days prior to the expumion athe Second Extended Terni; (a) if on the hit day of the Scoured E tended Tam there shall exist on memorial umwed breach allo Final Lease by die Leasee; (Ins if the Hotel hasbeencoao-umedontheP ms;aod(IV)ifihe Se Oprionw exercised- Wrthintm days ofreceipt of the Tbird Exercise Notice and within ten days prior wthe expiration of the Secoon of the Le Term the Lessor shall advise the Lessee, a waiting a w the a ossa ore and the opinion of We Lasmo) of any material uncured breach of the Fiat Lease by the Lessee; end the Paga4waa 03-345 Lessee, in each inatmme, shall be entitled to cure the same prior mthe expiration ofthe Second Extended Term. 5. The Lessor does hereby give and grant mato the Lessee the irrevocable right and option (the "Fourth Option") to mound the Initial Term fm an additional period often years (commencing on the fust day following the expiration of the Third Exterdel Term and comma ng for a period of ten years thereafter); which unfunded period sball be referred or herein as the"Fourth Extended Teem". The Fourth Option may only be remised: (I) by written ounce ("Fatah Exercise Notice") transmitted by the Less« to the Lessor at least 90 days poor to the expirazion ofthe Third Extended Term; (m if ma the hat day of &a Thud Extended Term Were shag mist no material named branch ofthia Final Lease by We Lessee; (Drs if the Hotel has beenconstructed on Ne Pramises;and(IV) ifthe Tbird OPnon mea exatised. Witbintmdays ofraeipt of the Founh Exercise Notice send within tundays pesetas the expiration ofthe Thud Extended Term the Lessor shall advise the Lessee, in writing, as to the existence (in the opinion ofthe Lmaor) of any material uncured branch ofthe Final Lease by the Losses; and the Lessee, in each instance, shag be entified m came the some prior to the exposure of the Third Extended Tear. Forpmponss ofthis Final Leans the term"Teem'shell be and mean the3nitini Term and any and all of the First Extended Term, Second Extended Term, Third Extended Tam and Forth Iced Term as to which the appropriate option shall have been exercised by the L see. "TIME I V - COh9PUTATION OF ANNUAL RENTAL Leasee covemms to pay to the Lessor as rental each anal every year during the Term for the Premien the following amounts (collectively the "diem"): 1. Baa Rem: (A) Subjectm We provision ofwbp�hs l(B), and (C) and (D) ofArd de W hereof, the Lessee shall pay to the Lessor as remal for the Premises the sum ofS319,200 pa strum; which amount shall be payable in 12 equal momhlY installmems each as that annum of 526,600. (B.) On each 5 yam anoivesary oftlm Communrement Date(wmmencitg withthe flfth anmmlmni a ofthe Commmcememhaze)the Base Rentforthenestfiveyensofthe Tear shall be adjusted n hereinbelow Provided. Within 30 days f llowivg each Sa year anniversary (commencing with the filth anniversary of the Commmcemem Daze) the Lessor shall deliverto the Leen the Currant Value (as defined). Within 30 days ofieuipt by the Lessee of the Cuuunt Value the Lessee shall either (1) evidence its agreement with the Curren Value by wrium when ("Conatrence Nonce") outsmarted in the Lessor prior to the expiration ofeuch 30 day period or (D) trearm a written afire disputing the Comer Valise ('Dispute, Notice'). ffeh w(y)the Lnseetraremitsa Coamrmu No6mm(z)the Leaxefailsto transmit a Dispute Noticewithiv such 30 day period than and'm either such even the Base Rent frthetextEveyeahofthe Tem¢hallbeinanamoursequalwo 6%oft Cumem Vabe; the moral and movoblypaymeW dexnbed in subparagraph 1(A) ofArticle IV sball be Panutiam 03-365 appropriately adjusted effective as of the first day of such five year period; and any underpayment or overpayment shall be added to or deducted from the next monthly paymem(s) of Baseltart payable hersuoder. Ifthe Leesee roommate a Dispute Notice to the Lessor within auh 30 day period, thus and inthatthe even is=ofthe determinariu ofthe uurmt fair market value of the Prestress; shall be submitted to arbitration in accordance with the provisions of Article RY):I hereof, provided however that in reaching their determination of the then current fa'u market value of the Premises the arbitruora shall value the Premises as if the Premises were raw and unimproved land (exclusive of my improvements to, on or under such Pnmiwa). Upon receipt of the arbitrators award establishing the amount of the current fair market value the Base Rem for the next five years of the Term shall be in an amoum equal to 6% of the cmrem fair market value (as determined by the arbitrators); rhe anmml and monthly payments described lu subparagaph 1(A) of Article IV shall be appropriately, adjusted effective as of the first day of the von five years of the Tam; and any undmpayment or overpayment shall be added to our deducted from the vest monthly paymem(s) of Base Rust payable hereunder. For purposes ofthis Final Lease the farm "Current Valu" shall be and mean the fair musket value of the Promises computed as if the premises were raw and unimproved land (exclusive of any improvements m, u or undo such Premises. C. Ifthe Hotel Property is removed fmmtbe Premises and the Final Lease thw and in that event commmmivg withthe first calendar mmNfallowingthe date of such removal the portion ofthe Base Rem mberwise payable monthly by the Lessee mtheI essor as hereinabove provided shall be proportionately reduced based upomthe relationship of the Hotel Property (includingrelated parking andd Leeitiu, ifarry)"aPremiest ed to the Pre mit removal from the Presumes and the Final Leede the f tote Property is restored to the Premises and subjected ungthethe Final Leasethen and in that eventwith Base edotthefirer calendar moved followingthe data essuch rmromtioothe portion of the Bele Rem ofiely iin payable monthly by the Lessee to the Lessor as hereinabove provided shall be proportionately increased (m hereinabove computed). )). Rent shall be paid monthly in advance on the first day of each and every moth. Lessee shall pay all retards herein required, without prim demand therefor, in lawful money of the Ututed States, u the address ofthe L mmr as out forth beein or u such other reasonable places as the Lessor may designate. Lure payments shall be subject to an interest charge of one percent (I%) per month to the due ofpaymem. 2. PerormageR®t (A) Sublemm the provisions ofsubparagaph2(I)) of Article N, the Lessee"pay to the Lessor, with respect to, each Annual Period (as defined) a portion of the Goss Slot Revenue actually received by the Lessee ("Percentage Rem') during arch AnmW Period (as defined) determined as follows: 3%ofthe that $50,000,000 of Gross Slot Revenue annually received by the Leuee during each Annual Period (ea defined); 4%of Grose SIM Revenues between $50,000,001 and S70,OOD,0oO actually received by the Lessee during such Actual period (as defined); 5%ofGross Slot Revenues between$70,OOo,001 and SIOO,000,000 morally received by the Lessee during such Avmml Period (as defied); and 6% ofGroas Slot Revenues in otess Page6M22 03-345 of $100,000,000 actually received bythe Lasa durieg such Amaral Period (a defied). For purposes oftins Final Lexthe tem "Annual Period" shell be and man a 12 consecutive month period commencing (a to all but thefirm soh pmmd)on do firm day following the end oftu mmedirsely, preoct ing Annual Period; and as to the that such Annual Period commencing on the first day of the month following the month during which all of the Phase U Conditions shall have beensa isfe& Paymen ofthe Percentage Rent with respeafo each Annual Period shalt be paid atthefines and inthe mmrcr se forth in subparagraphs (B) and (C) hereof (B) VPnhm 30 days following fim end of each of the 12 calendar months occurring during each Annual Period commeaciug during the Term, the Lasa shall pay to the Lessor that portion of the Percentage Ron% if may, applicable to such Annul Period determined a follows: first, the Gross Slot Revemm received by the Lasa during the period commencing m the first day of such Annual Period and [eminating m the last day of the subject month shall be determined (the "Cumulative Revenue Amounal; second, the summit ofthe Percentage Rent payable with respect to the Cumulative Reveme Amount shall he determined in accordance with the Provisions of subparagraphs (A) and (D) hereof (the "Cumulative Patted Rent'); third all payments of Percentage Rem made by the Lessee during such Annual Period shall be aggregated ("Cumulative Payments To Date"); afN fourth, the excess, if my, of the Cumulative Percentage Rent over the Cumulative Payments To Dme shall be paid to the Laser. (C) Ifwith respect to my Annul Period during which taming Machines shall be in operation at the Premises the Cumulative Percentage Rent dmendmd at acoardmce with the provisions of subparagraph (B) hereof is las then $1,000,000 than and in that event within 60 daysfollowingtheendamch Annual Periodthel sbaRpaymthe Lessortheexcessof $1,000,000 ovwthe Cumulative Percentage Tian for much Annual Period. (D) Mdumgthe Temtherevenu sharing payments regmredbythc Malo Law authorizing Gaming Machine operation are increased a decreased by legislation combed subsequent to the adoption of the legislation which initially authorized such operations, or otherwise (other then as a result ofCaphal Action, a defined) mm and in that event the percentages set £beth in subparagraph (A) hereofutilimd fm de souning Percentage Said in each Annual Period shall be adjusted by adding or subtracting, as the case may be, one thbd ('A) of peramage point for each our percentage point achango; an that if the manage sharing obligation is increased by l%, then IN ofl% shall be deducted from each of the percemags son Both in subparaiuph(A) hereof To the anent that any such increase or decrease is expressed in dollar anomer insairl of percentage; than and in that event Ino 1%of any each dollar amount noncom or decrease shall be applied asa credit or debit tithe case may be, to the Lass's obligation for Percentage Rout during each Annual Period. ARTICLE V - USE, OCCUPAUCY AND ALTERATIONS TO PREMISES 1. Leeashallhavet nghtwmu acapythe Prmm(inuludmgwlthmt limitation all Phase U improvements) for my lawful business purpose wcluding, without IimitNion, the purpose of operation of hotel, grating (including without limitation Gaming Machines) and confnena center, grandstand hennas racing track and stables and concerts Pete 7 of 22 03-365 consistent with the terma and conditions of the Development Agreement. Except as bemin expressly provided in the country, Leasee shall, m all Limn during all but the first 6 monWs of the Term, operate a rommum of 1,000 (m the maximum number permitted under Sate law, whichever is lees)faminB Machiees. Lessceshal coo eiuWsinessesconducwdazNe Premises m a reasonably busamolike, cerefid, dean and reasonably safe manner. Z Lessor, through its agents, shall have at all nameable timeathe right upon reasonable prim mitten notification to the Lasa, to go an and inspect the Promisee, any buildings, sbudures a imProvemame thercon, with an authorized representative ofthe Lessee, and the right of access to utility systema located on the demised Premises for the purposes of meietemrmS repair, correction, minspe tion. For purposes ofthie patgmPh4 °reasonable notification' shall include any acmai notification in the Lessee or its agent am less than one businersdayprormthedideofisupcction "Rnsombletime"shallmmmytimeduring I.casx's regular business hours, or during seasonal weekday business haus if envc shall wase operations or shall maintain other than regular business home Any such inspections dull be conducted in a manner which don not interfere with the privacy or confidentiality of the f usee or his customers. 3. Consistent winhnhe terms ofthis Final Lease, Liesx shall masse sound business judgmeve, in the operetionofits businesses at the Premises eM consider the Lessor's though act nanous a l advice The , the fi s and lessee's specific responobgides shell include, though rot vceesserily be limited m, the following: A. Neighborhood Public Relatiomand Prote�on. Lesseeismindfdaftheimpeact ofharoms room& concerts and Laming Machine activities on the mrsediate neighborhood and surrounding area. Lessee agree to adhere to the following guidelines: (1). Nofivermeshallatu A"11A0pm.uden,duemmuNmeseen emergency web as, but not limited to, loss of power, Ion of computer supporter cur the mumel ares, ®chits, evident, or loss 9ambuhance support races are delayed. In such circumstances, Lessee shall make may off utto accelerate post tunes and to finish operating at a reasonable hour, in no case later than 12 midnight. (m. Lemce, in conducting Lesson's aclivides under this Final Lease, shall take rc saz stepsmpreventgw flonofezceseivenoise. Forthis purpose, excessive noise shall mean mise ofa whims, pith orintmsity likdymunrnaonably divtmb the pence ofmdbany occupana ofresidemiil properties surrounding No Bass Park Complex for a remerial period of time. Lessmahall notify, the Leasmofanye sntdut cavbe reasorubly anticipmedmdisoubthe peace ofmd'umry occupants ofreaidismal properties surrounding Bass Peak and shag cooperate with Lemur to minimize the disturbance earlier the impact thereof (IB). Tothe best of its ability, Lessee shall etruse that hotetrailas and facility track will comply with all applicable Lessor's rules and regulations. ARTICLE Vel_ LL&BUM AND PROPERTY DAMAGE INSURANCE Pageaotm 03-365 I. The Lesser shall provide and maintain the following insurance during the Term: (a) Inconnection with then employment of its employees, Lessee shall pay all applicable social security, unemployment, workers' compensation, or other employment taxa or contributions of iosumnce and shall comply with all federal and state hews aed regulations relating to employment genially and to wages, social security unemployment insurance and workers' compensation m particular. Laser shall indemnify and hold harmless the Laser from ell costs, expen w, claims or damages awaiting Brom any failure ofLessee to comply with these requirements. (b) Lease shall procure nod maintain comprehensive geswral liability and automobile IiebilLLy insurance on behalf of body and the Lessor (a Weir respective interests may appear) against any damage, loss or liability or claims alleged to have arisen from the use or occupancy by Lessor of the Premises. With respect to the required insurance, the Lessor shall be named as an additional insured; be provided with awaiver of subrogation in favor of the Lawn; and shall be provided with thirty (30) days prior notice of cancel Won or material charge; and shall be provided, through the Office of the City Solicitor, with certificates of insurance evidencing me above required insurmce. The cost of inch insurance shall be paid directly by Lessee (c) The amamts of such coverage shall be no lass than a me follows: TWO Amused 1. Workeo'Comperiamon $1M combined single limit Statutory Employers Liability 2. Comprehensive Public SIM combined single lima Liabilityto include but were additional umbrella vole lmitedmthe policy 0ermn less mass following. $2M a) premises/opemtions b) indapendentcmoraher c) psommal injury coverage d) pmducr/completedoperations e) onatudmel liability 3. Coropreheevive Automobile $1M combined single limit Page 9022 03-345 Liability coverage to include coverage for. a) owced/re od automobiles b) nonowad automobiles e) hired cars 4. Standard Form Fveor Replacement Value All Risk Ins mance Policy (d) Should Losses desire, Lessor will eotutain a request that Fre or All Risk !normae be provided by the Login and shall be paid on an agreed pro-mta basis, by Lessee for those periods in which Lessee occupies the Premises (e) Fach innnance policy pmwrd by Lessee shall affumadvely sate that it will not be invalidated because the insured waived its rights of recovery against any party prior tothe oeaurenceofaloss ARTICLE VO -HA 011J$WASTE 1. Leaseeherebycovewuhanda thetitshanct,dunngtbe Tampermaoeotly place, cause to be placed, deposit or discharge any hazardous waste upon the denoted Premises, or upon any outer portion ofLessols property, and Roger expressly agrees that it shall indemnify Lessor from any and all costs, wspe res or holiday, nrwbateva kind or more, incurred by the Lmtor in detecting, eviduatiog, removing, veering, disposing of or otherwise responding to say hazardous ware placed or deposited in violafion of this paragraph 2. Leaaherebycoveouorasodegreesth kshallnm,dwiegthe Tem,violatemy local, arm or Federal rigulffiioq ordinance or Agree pertaining to hazardous waste or hazardous material and fiuther capressly agrees that it shall indemnify Lessor from any and all cons, wgxrue or liability, of whatever kind or nature, incurred by the Lessor for my such violation of this paragraph. 3. Suchwasshallbedeemedminlude,withoml afion Les escosteofdefwding airy m@ filed by any person terry, agency, orgovemmental authority; paying any fines imposed in connection with mch suit; paying anyjudgmeots or otherwise settling my damage claims; remedial awg my ordmbyo wort ofwmpetwfjll associated Le an to take remedial action with respect to ausL waste; and of all asmciated attorneys [as and ens. 4. FmthepuiposeaofthisArticletheterm"ha mswate"shaRbedeemedw include every eubatavce now ar hmeefler daigswed a a hazadoa wa[eundm enyprovision of Smtew Federal law. Lessee's obtigmiorrautederthis Article sWlbe deemed meurvivethe expvafion or terminative ofthia Lsse. Page til orm ARTICLE VM- WDEM 1, General Indemnificafion-Lessceshall defendindemnify, sort hold Lessor, and its inbabitantq officers, employees era agents completely harmless from and agars; my and all liabilities, losses, units, claims, judgments, fines or demands wising by meson of injury of death of any person or damage to my property, including all reasonable costa for investigation and defense thereof (including but me limited to atomeys fees, court roam, and expert witness fees), of my [awes wiamoewr wising out of incident to the use, oecupway, conduct, or management of the Premises or the acts a omissions of Legends officers, agents, employees, contractors, subcontractors, Russians, or invitees, mdeas such injury, death, ordamage is caused by me negligence and/or intentional misconduct often L ser and/or its agents or employees ufiliaingthe Premiswmd/apordonsthermfbytcroseuhweinprovided. The Lwseshall civemLesmnablyeableableto norm cclams oractlobl adios under this also engage rnuasm reasonably accephblem Lassa w carrying out its obligations under this Article. 2. Lessee's WaivaofWakes'Compma onlmmunity-TheL hereby expressly agrees thatit trill defend, indemnify and holdthe Lessor, its inhabtmts, otfiows, employes and agents completely harmless from any and all clams made in asserted by the Lessee's agents, servams or employees arising out of the Lessee's activities under this Final Leve; provided however fha Tensile aferead indemnity and hold harmless agreement that not he applicable to my liability based upon the negligence and/or intentional misconduct ofthe Lasa and/or native utilizing the Premises and/or portions thereof by licenses beeves provided. For this purpose, the Lessee hereby expressly waves suer ted all immunity it mar have order the Maine Workers Crmpemation Act in regard to such clams made in asserted by the Last's appears, servants or employees Subject be the limitations hereinabove set forth, the indemnification provided under this paragraph shall extend in and include airy and ad nests inexual by theI assor to avwer, investigate, defend and settle all such clams, including but am limited the Lessor's mats for momeys few, expert and other wireae fees, the coat of mvestigators, and payment in full of any east al judgments rendered in favor of the Lessee's agars, savants or employees against the Lwin in regard to clams made or asserted by each agents, servantsa or employees. 3. The Lassa shal indemnify, defend, and hold harmless the Lessee Rom and against all claims and acfione and all inspection incidental on such clams or actions, band upon or arising out of damage to property or injuries to parties or other tortious arta caused or command to by the Lessor or anyone acting under its direction or mmml or in its behalf in the cause of the Lessor's activities under this Initial Lease and/or others utilizing the premises and/or portions shared pursuant to the license granted to the City, provided that Lessor's aforesaid inclemency and hold harmless agreement shall not be applicable to my liability based upon the negligence and/or intentional misconduct of the Lessee or anyone acting under its direction or cadent or in its behalf in the wire aft a Tenet's activities under this Fina Lege 4. The laaurberebyexprway agrees that it will defend, indemnify and hold the Lessee harmless from my and all clams made or waded by Lester's agents, servants or employees arising out chasm's activities under this Fina Lease provided however thin Lessor's afrrwad indemnity and hold harmless agreement shat nor he applicable to my liability bored Page 11 of 22 03-365 upon the negligence and/or intentional misconduct of the Lessen or myons acting under its direction or tunnel or in its behalf in the course of the Lessee's activation order this Lease. For this pmpose, Lessor hereby expressly waives my and all immunity h may have under Maine's Workers' Compensation Aa in regard m such claims made or aerated by Lessor's agrees, servants, in employees subject be the limitations herewabove set forth The indemnfficuun provided ender this paragraph shall emend to and imlude my and all costs incurred by the Leaseem answer, investigate, de&md and) settle all such claims, including but not limited to the Lessee's nus for mmmey fres, expert and other whores fen, she war of investigators, and payment in full of my and all judgments rendered in favor ofLessm's agents, servams or employees so= Lessee in regard in claims made or asserted by such agents, servants, or employees. ARTICLE IX - DAMAGE BY FIRE OR OTHER CASUALTY Lessor agrees that it the event ademuction of or damage by lire or other casualty to my improvements sioated on or under the Premises (irrap"tive of whether owned andlor operated by the LassaLessee), aro my pan thereof, and an often as the improvements shall be damaged, by fire or other cemalty, Lessee shall have the right but amt the obligation to rebuild and repair the improvements for occupaimy. IfLcmmelects but to rebuild and repair, u shall so notify Lessor within sixty (W) days or more expeditiously if possible of its decision. Lesson shall then have the option should Lessee have elected not to rebuild or repay an afsemid, to (a) Interstate No Final Lase if the damaged or destroyed and not rebuilt improvements are either the Facility or this facility in Which the Gaming Machines are operated or (b) in all other cases remove the portion of the Premises on which such improvement was hammed from this Final Lease (without abatement of rad) and to caum Leases to demolish all Effected Smactmes in defined) to ground level, remove all fomdmions and to remover all debris from said demolition 6om the demists Remiss. India event Lesser decidesto rebuild arts repairsaid damages all destroyed or damaged improvements shall to the e#em of available insurance proceeds he restored to their sate and condition prion to said fire orahm casualty, or shall be comwmed in accordance with plant approved by the Lessor, which approval shall not be naamaably withheld or delayed. Any ineuraoce proceeds whether received by a payable to the Lessors Lash shall in my evens, be paid to and retained by Lessee, subject to application by the Losses w rmovatihq repair or rnanstructioe as hereinabove provided. For purposes of this Final Leans the term'Sffecced Smlcbres" shaF be and mem swclutes "usual by the Loses onthe Premises and which have been damaged and/or destroyed by fire or other asualty. ARTICLE X -RULES. REGULATIONS ABD LAWS The Leas« hereby agrees and on cause 9 Personnel employed by the Lash to obey, all municipal ordimnees, and all Stare and Federal rules, regulations, or lawn. ARTICLE XI -TAXES Pape12a22 03-345 1. Subjecttotheprovi6onsofPwagaph2o£ArticleMber CQ Lesucegeestopay, when due, any and all taxes and/or asseaements, fees orcharges of any kind whensoever, as may be imposed during the tetm herwf; or any catension of the term of this lease, by any governmental authority upon rhe demised premises, including Lessee's leasehold interest therein any structures, or improvements thereon a any passoml property located therein. It is expressly agreed that such taxes and assessments shall include all amounts levied as real estate taxes upon the demised premises by the Lessor acting in its goverrmemal capacity. Lessee further hereby waives any and all rights or privileges of exemption from taxation on dw demised premises, or Lessee's leasehold mucant therein, or on any building, suucarm, or improvements thereen, or on any personal property located therein arising due to public ownership of the demised Postures by the City of Burger; Provided, however, nothing herein shall in any way Prohibit the Lessee from exercising its rights under the law to current the amounts ofsoch taxes, assessments, charges or has 2 Anything in Paragraph I ofAttiele M hereof to the convary notwithstanding: (A) Lessee's obligation to pay persosW property and real evare imres under the Final Lease shall be based upon the current assessed value of the real property and the current improvements; (B) Upon the construction of any of the Phase Improvements the assessed value of such phase IT Improvements shall be determined by the City Assessor la accordance with assessing standards applicable to privately owned property, applied on a convener[ basis and on a basis consistent with prior practices; and (C) Should the Lessee disagree with the current assessed value established by the City Assessor, from time to time, Lessee shall have the same rights to challenge and appeal any such aseessmenge) as applicable to privately owned property; and for such purposes the Lessee shall be Vested in the same maser as any other owner of private property in the City. AETFCIAX - Leaves for itself, its personal representatives, mmcessas or interest and cosign& and as part of the considerations herrn( does hereby covenant and agree a a covenard running with the land that (1) no person or group of persons shall be receded on the grounds of race, color, or national origin from participation in, denied the benefits of or be otherwise subjected to discrimination in the use or occuparmy of said detained Premises and (2) in the conduction of all improvements, buildings, structures, on over or under such land and the furnishing of services thereon no person or group of persons shall be eacluded on We gerunds of macs, color, or national origin from participation in, denied the benefits of, or be otherwise subjected to unlawful discrimination AETICLE=-COVENANTS OF QUIET ENSOYMNT The Lessee, subjen to payment of the Imseftent andPercentage Rens amt observing, keeping and performing all the terms end provisions of the Food lease on its pan m be observed, kept and patterned, shall lawfully, peaceably and quietly have, hold, occupy and Joy the Papa 10 an 03-345 demised Premises during the Term hereofwithaut hindrance or rejection by the Lessor or soy other persons. FA'aI AA 7:e\'a M WKI The Lessor sod the lessee agree that each will Formerly discharge (either by payment or by filing of the necessary bond or otherwise) any mechanics', marerislmen's or other liens against the demists Promisee, any MIdings, sntenves or improvements thereon, which lien may arise not of any Payment due for labor. services, materials, supplies or equipment which may have beet finished to or for the Iessor or the Lessee, respectively. ARTICLE XV - TITLE TO BUILDINGS, STRUCTURES, AND IMPROVEMENTS Tele to the buildings, sometimes and improvements cormhvc[ed on the demised Premises by the Leasee either prior to or during the Term (collectively the'"fennt Improvements") shall he in the Lessee, and during each Ten, the Leseee shall have the right, m its sale expense, to demolish and remove, improve or alma my and all Tenant Improvements and other personal property enacted or located on the demiand Premises. All each Tenant Improvements ahall conform to the Development Agreement and the Phase D structures, Aimprovements, foapcmilietmies peunrdsuiavnsinstallinstallinstallationsn. erLemremly on the Promises, ailleclud4dnigngth, e grandstand and tree& Any proposed physical changes to any enuring buildings, structures and facilities owned by Lemor shall be made m accordance with the terms and conditions of the Development Agreement. ARTICLE XVI- REMOVAL OF PROPERW 1. Upon the termination or expiration of Nis Final Leese andbor the expiration ofthe Term, the Teneot Improvements and other personal property erected or located upon the demised Premises by the Lessee during the Term shall remain the property of the Lessee (except any improvemema to buildings, structures or insellahoee of Lessor existing at the time of the execution ofdils lease), and the lessee shell have she right m remove the same frdm the demised Premises within sissy (60) days following the date oftenivadon ofdas leeae or Wimtion of the Term. Any such property nor eco removed within said sorry (60) days shall become the propertyofthe Lesermb disposedofivsuchawayw Ne Leemrmaydeem5t. Intheevent property, telecladiremoveall manyoaths Tenant urnedImprovements; pryetherpersonal property, o an nesdissgs and IoM ais cttevatm tlm Tenor Improvements mremav L asell be reliacedm as year as possible m its conditioning the wmmevicemeM ofNe Pinel Logan, wdiwry wen and tem axceetad. Page 14 of n a3-345 2. In Has event Lessee shall Gil to remove my Tenant improvements or personal property within sixty (0) days ftom the data oftennination or final expiration of this Lease, Lessor shall, subject in the tame and conditions of my witten agreement executed subsequent o the date hereof by the Lesser and Lessee with respmt to my such Tenant Improvemems, be entitled to recover from the Lessee Lesmea niumnable costs inured in removing or disposing of such Tenant Improvements m personal property. In web event there shall be deducted from Lassoes coals the fair value actually realized by the Lessor from the sale, use or other disposition of the Tamarrt arryrovements or personal property wncemed. ARTICLE XVII- SURRENDER OF POSSESSION Subjw to the provisions contained in Article XVI, the Lesstt shall, upon the m rnmidion of this Pinel Leant or expiration ofthe Term, mnendn the quiet and peaceable possession of the demised premises ARTICLE XVIII -TERMINATION R is coveoarded and agreed that subject to the provisions of Articles XX end XXI heed, (1) If the losses elan neglect or Gil w pay the Base Beet and(or Percentage Rat w other charges payable bereunder and web defwk shall continue for a period of thirty (30) days after vrittm notice thereof by Lessor, or (2) IfLessa shall neglector fait to perform or observe any of the under anvmame, terms, provisions, or conditions on in penin be pertmmed, or observed, and inch neglect or failure shall coatings for a period of thirty (30) days after writing notice thereof by Lesser or if web veomts, termer, provisions or conditions came be performed or observed voting said thirty (30) day period, ifLewoo fails to commerce m cure any Such neglect orfailure within such 30 daypentod and/or thereafter Gua to diligeglypmsemte the curing &web neglect or failure: or (3) If the state hereby crossed shall be taken on execution or by other process of law; our (4)Ifmy Secured assignment shall be made of the property of the Lesson for the benefit of creditors: or (5) If receiver, gugdisa, conservator, or gusto an bankruptcy or other similar officer shall he appoaned to take clause of all or my substantial part athe Lesscas property by a Court of competent jmisdimiov and the same shall not be discharged within 90 days written notice from Lessor. Theq in any of the said cases, the Lessee (individually "Event of Default" mrd wRectively "Ewers ofDelimlo may be considered in defmh bereunder, and the Lessor lawfully, may, immediately or at anytime thereafter, dining which any such Event a Default shall comimse in exist and upon 10 days prior witien notice to the Lessee(' eiaee Deiauh Page 15 of Lep 03-345 Notice") ewer man and upon the said Premises m any part thereof, and expel the Lessee and those claiming through or under it and (subject to the provisions of Articles XV and XVI hereof) remove sm or their efforts (forcibly if necessary) wthmt being deemed guilty to any manner of trespass, and without prejudice to my remedies which lessor might otherwise have. Upon such entry, this Final lease shall terminate ptovidN however, that if the Lessee shell contest the occurrence of my such Event ofDefsult by woman notice to the Lessor transmitted within 5 days of receipt ofthe Lessor Defruh Notice, then and in that event (a) the issue of the consomme, of the Event of Default ad forth in the Lessen Default Notice shell be submitted to substation in accordame with the provisions ofArticle )OM hereof, (b) the Lessor shall not be emided tore - e cmc the Premises and/or remove the Losses and/or any of its property and/or anyone claiming through or under the Lessee and/or terminate the Final lease unless mW unto the award of the arbitrators; shall find that the Evert ofDefauh described in the Lessor Default Notice in fact occurred and/or mists and (c) until the award of the interment is rendered there shall be to abatement ofrmtt. Ifthe Final Lean shall be terminated as hereinafter provided, the Lessee shall be liable on pay as rent, amounts equal m the several installments of Base Rem and other charges reserved as would have become due under this Final Lease if this Firm Lease had not been tasmnated or if the Lessor had sant entered or reentered as afrreaaid. Notwithmanding the foregoing Lessee'& liability shall not exceed the didvrnce, if any, between the Base Rest which womd have been due had there been no such communion, and the amount being received by lessor as rem from any new tenant or occupant of said Premises. N order to mitigme Lessee's damage hereunder, Lessor agrees to make every reasonable effort to, secure subsequent reasons, m arental a least equal mthe then prevailing local rete for the demised Premises. ARTICLE XIX -ATTORNEY'S FEE 1. The Lessee shall reimburse the Iesaorfor reasonable attorneys fees incurred by Lesson in the event the Lessor employs an a tummy In collect ay, rents due bveunder and secures a judgment in connection with collection of mid rent, or legal process is levied upon the musuct of the Leasee inthis Lease or in said premises, a in the event Lessee vialux any of the terms, conditions or covenants can the part of the Lessee herein command, it but only if Lessee fails to promptly correct the violation a my tam, mndnion or coveeem atter receipt of notice that it is in violation thereof 2. In the event Lessor employs its City Solicitor or an assistant "mon W ellect rntts or otherwise protect Leasor4 interests under this Lease "reasonable aumneys fees' under this Article shall mem the reasonable con ofsavims provided by Lessor's Schram or Mahatma sotichm, athe race charged for similar services by pdvue attorneys in the Bangor area. ARTICLE XX- ASSIGNMENT, SALE AND SBBLETTING 1. Subject to the provisions of Paragraph 2 ofthis Article XXand Article XRl hermf the Lessee shall nm a my time assign, sell, resurvey or tranal'er this Lean or any interest thereir, or sublease or sublet m rent the Premium, or any pat thereof without the prior written comeal of the Lessor which coosem shall not be unreasonably withheld, delayed or conditioned; Page16m2t provided however, that tlse consent ofthe Lessor shall not be mgleed to a sublease or assignment in the mantled the Lessee Iowa and/or does not obtain all required Geeing Permits and/or live racing license; and/or racing dates and such sublessee or assignee (a) has secured all reignited Gaming Permits andfor live racing ficenses end racing data and (b) hes provided, or provides to the Lessor all reasonably regueated information with respect on its financial condition ad principals. In the evem of an approved orpelmittd assignment or sublease, all provisions of this Final Lease shall rand to, bind and more to the benefit of am only the Lessor and Lases but also their or zssom and assigns. 2. Leasee shau haw the right to assign Us Lower (a) m BHT or(b) many corporation with which it may have become merged, consolidated, or otherwise associated, or my corporation or holding compary having the controlling interest in rhe Lessee, orb my coo a ion which may be a mbsidimy ofthe Leasee. in no even, however bodwi than inthe event of an assignment of BHT), shill the Lessee named herein be relieved from my obligations under this Lease by virtue of any assignment or subletting .:eN Aa ab: saner ftm 0 010 W. I •_ul. 1. Lessor is cognizant of the need of Lessee to finsncedm construction ofeguipping and/or Ennishing buildings, structures; and impmvemems on the drained Premises, and therefore specifically agrees on permit the Lesseeto mortgage, cunditiomBy assign or transfer its leasehold intereu in the Final Le• ^ and/or demised! Promises for the putpou of obtaining equipment, construction and permanent loam financing for the co muucgon, equipping and/or fiunishing of said buildings, sciences, and improvements, Provided: (a) The term asuch mortgage, conditional admitting; or transfer (collectively "Financing Pncumbmna') shall nm owed the duration of the Initial Tum plus the First Extended Tum and Second Fanendd Term hereof, (b) Lesser shall give antice in the Lessor ofthe animus of any such Financing Encumbmvu, together with the name and address ufibe mortgagee assigcee or transferee and a copy of the mortgage, or any such Financing Finambraece; (c) That in the evert aforeciosure of my such Financing Encumbrance, and in the event that said mortgag a, conditional assignee or transferee her its respective trandues, successor or assign) shelf become the owner of the Lessee's inumen in the Final Leese sandlot the Prises pmsumt he such foreclosure, said mortgages, conditional assignee or tansferee (or its respective trmsferce, successor or assign) shall have the right to eke possession and along become the legal owner and holder of the Final Lease and the lease -hold eaate armed hereunder and shall hold such estate upon the same terms and conditions as held by Leasee from which such mortgagee, conditional assignee or traisfiree (or hs respective transferee, woreaear or assign) acquired possession, but in such event, said mortgagee, conditional assignee or transferee (or its respective trmsferce, successor or assign) shall be liable under the tams and conditions baenfduring the period of time during which said mortgagee, assignee or transferee (or its respective transferee, successor or assign) holds such ¢ante, and for my defvults under the temu or conditions hereof Pape 17 of V O3-345 which arose before said estate become vested in said mortgagee conditional assignee or transferee (or its respective hansfemz, successor or assign), however, that such mortgagee, conditional assignee or tmosferee (or its respective veoaferee, successor or assign) shall not be liable for defoWt(s) ante Lessee occurring prior to foreclosure unless Lessor provided writ notice of such defaub(s) to the mortgagee, conditional assignee or banshees (or its respective trOulerm successor or assign) before the effective date of the foreclosure voice. (d) That the esdatence of any such Financing Encumbrance, or any foreclosure shared shall not relieve the Lasses Gum any liability or respon ibility of the obligations on its part m be performed. (e) The Lessor agrees that it will not vas rcise hs righter terminate this Lease in the event of my default unless such mortgagee, conditional assignee, or transferee has be given (1) writ once tithe Lessee's failure to cure the default and (2) an opportunity to sue suers ddault (of at least equal duration as the time provided for the Lessee to cure such def alt under the terms of this Final Lease), or alternatively, at the election of such mortgages, conditional aseignee, or traruferce, the period oftune ax; necessary to allow the Lessee's banned herein so be foreclosed, provided that such mnngaM conditional assignee, or treosface shall be Gable under the tem v and conditions hersof during such period, as provided in subparagraph O of this article above. I.essoea obligation to give notice under this section shall extend only to theme mortgages, conditional assignees, or transferee known the Lessor as a result ofnotion given by the leases in accordance with subparagraph (b) ofthis article above. (f) Any each mortgagee, coodirional assigns, ortransferee succeeding to the Lessee's interest herein ¢Gall have the right to assign or solder the premium as provided b Article X ARTICLE=-AlITRORFFV TO ENTER INTO AGREEMENT 1. The lessor hereby represents and warrants that it has talent all necessary procedural and legal steps as required by federal, stare and lord laws and regulations for the purpose of mrtGorizing the extension of this Final Lsu and them execution of this Final Lease by the City Manager readers this Final Lease avalid and binding docmmeot on the part Odra Lessor and the same is fully enforceable in all of its tame and condhimu by the Lessee. 2. Lessee hereby represents and wanaana than it has taken all necessary procedural and legal steps a required under all acute, local and federal laws and regulations, and all necessary corporate action to authorize the eecuthm of this Final lease by its undersigned corporate officers and that upon such execution this Final Lease is a valid and binding document on the part of the Lessee aM is fully enforceable In all of its terms and conditions by the Lessor. ARTICLE X - WAIVER Failure on the part a either party hereto to complain of any action orronseu[ion on the part of the other party no matter bow bog the same may contimre, shall never be deemed to be a page 18 M22 03-365 waiver by any of such party of its rights hereunder. Fureha, it is covenamed and agreed that no waiver at my time of any of the provisions hereofby either party barman, shall be concerned as a waiver of any other provisions bartender, and that a waiver at any time of my of the provisions hereof shall not be converted 9 my subselaent time as a waiver of the seats provisions. The approval of Ussaar or of any motion by the Lessw rerlulring the Lessors consent or approval shall not be deemed to waive m render unnecessary the Leasure consent or approval of any subsequent sh filar act by the Leasee. ARTICLE XXIV-NOTICES Notices to the Leasor provided for in this Leece shelf be sufficient if hand delivered, delivered m a reputable overnight delivery service or sem by registered or wed mail, renown receipt requested, postage prepaid to: Edward A Barratt, City Messiest City of Bangor CityBili 73 Nadow Strun Bangor, Maim 04401 Notim to Leasee shall be mu icieot if head delivered, delivered m a reputable overnight delivery service or amt by registered or certified mail, return receipt reluesled, postage prepaid, addressed to: Capital Seven, LLC 1055 E. Tropicana Avenue, Suite 700 Las Veggie, Nevada $9119 with a copy to hfmtinc J. GUAM Esq. FreNman & Oerden, LLF 90 Birch Bill Road Nevnown, Cf 06470 ARTICLE )MV -INVALH M If my term or provisions oftbis Final Lease or the application thaeofto my person or cvcumstaecea is hereafter determined to be to arty extent invalid or unaoforcmble, the remainder of this Final Lwse or the application of such terms and provisions to persons or cvcumdmcea other than those to which it is held invalid or unenforceable shall not be affined bereby and such Page is of U W-]45 term and provision of this Find Lease shall he valid and be enforceable to the fullest extent permitted bylaw ARTICLE RR Vl - CONSMUCffON The headings appearing in the Fred Lease me inunded for convenience and reference only, and not to be considered in consaning this Final Lease. ARTICLE XXVO- NO PARTNERSRJP OR Nothing contained herein shall be deemed or concerned as meeting the relationship of principal and agent or ofparmeuhip or ofjoim voters between the parties, h being understood and agreed that nather the method of computation of rent nor any other Provision Command herein nor any etas of the parties shall be demand re create any relationship between the parties other than the relationship of landlord and news, ARTICLE XXVID-GOVERNING LAW This Lease shall be governed exclusively by the provisions hereof and by the laws of the Stan, of Maine, as the same may from lime to time exist. ARTICLE% -MEMOR UMOFLEASE The parties agree mtto record this lease; however, upon request of either, the other shall prepare and emcute a Memorandum ofi,eaee in form suitable for recording at the Penobscot Maine Registry of Deeds, as evidoce ofLesace's imerest in the Premises demised herein ARTICLE XXX -AMENDMENT TO LEASE This Final Lease end the Development Agreement occurs all the terms and conditum between the penes hereto and no dteuties, amendment or addition hereto shall be valid unless in writing and signed by both panics hereto. ARTICLE% -ARBITRATION cos, and all disputes and controversies arising out of or relating to this Find Leese saddler the Development Agreement shall be submitted to and settled by arbitration to be held in the City of Burgos, Situ of Maine in aceordsnce with the rules and regulations ofthe American Arbhntion Assoaation the obtaining. Such andration shall beheldbefnethreeasbitrators; one ofwhom shall be designated by the Lessor, can ofwhom shall be designated by the Lessee; Page 0 of 22 03-365 aM ora ofwhom shall be designated by the other two arbitrators. The decision of a majority of the arbitrators shall be binding; any award may include the reimbursement to either party of fees, costs and expenses incurred in contraction with such arbitration; and such award may be enforced in any won ofwmpdent jurisdiction. ARTICLE XXXD- PASSAGE AND EASEMENT Each of Lessor and the Lessee hereby grant to the other a right of passage and easement over ns respective portions of the Bass park Complex for purposes of access and egress to the enthe Bass Park Complex Without limiting the generality of the foregoing the Lesson, its employees, agents, servants and invitees shall have the tighten emerovto the Premises mall reasowble times with personnel, vehicles and equipment for the purpose for the purpose of maintaining repairing and replacing the infrastructure, utilities and appurtenant structures thereto. IN WIT SSW REOF, the parties hereto have set their hands and seals the day and year written above. WITNESS: CITY OF BANGOR PAward A. amtt Its City Manger W/fnnI//NESJP //s:: //�� CAPITAL SEVEN, LLC [ NameNeme: -- 5ka rifle: telsul Fx Pape 21 of 22 STATE OF MANE PENIOBSCOT, es October JI 2003 03-345 Then personally appeared the above-named Edward A. Barrett, City Manager ofthe City ofBangoq and acknowledged the foregoing instrument to be his free act and deed in his said capacity, and the free act ab dad of mid body corporate. Before me, �y� n /.IVI>n/M l l.B�-d.-- Notary Public/, EB L00gB NOTARY PUBLIC;MMINE. MY LOMNIPHpN E%FlpF$'MELEYBcP9, 10M STATE OF 44 Md .mow.. C -h+ c� Nenelsims October, 2003 Than personally appeared the above-named Shawn Scott, MINIM of Capital Seven, UC, and acknowledged the foregoing instmrnem to be his Bee act and dad in his said capacity, and the free ac/ and deed of mid body corporate Page 22 M22 Before me, ooll KWWQ% ,,0 N P eG A¢orney-a[-law -� _ [f= YOU KOeng %er` Expiration Oats: Jona 3,2009 3e. 47iF"op'N?em`� NM Page 22 M22