<PAGE>
As filed with the Securities and Exchange Commission on November 19, 1999
Registration No.333-80201
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
AMENDMENT NO. 3
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
______________________
AUTOLEND GROUP, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 523900 22-3137244
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code ) Identification No.)
</TABLE>
600 Central SW, Third Floor
Albuquerque, New Mexico 87102
(505) 768-1000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Nunzio P. DeSantis, Chairman and Chief Executive Officer
600 Central SW, Third Floor
Albuquerque, New Mexico 87102
(505) 768-1000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With copies to:
Marshall G. Martin, Esq. Jeffrey W. Hellberg, Esq.
Hinkle, Cox, Eaton, Coffield Hinkle, Cox, Eaton, Coffield
& Hensley, L.L.P. & Hensley, L.L.P.
500 Marquette NW, Suite 800 1700 Bank One Center
Albuquerque, NM 87102 Amarillo, TX 79101
(505) 768-1500 (806) 372-5569
Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are being
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box.
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
<PAGE>
-ii-
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering.
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.
____________________
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==============================================================================================================================
==============================================================================================================================
Proposed maximum Proposed maximum
Title of each class of securities Amount to be offering price aggregate Amount of
to be registered registered per unit /(1)/ offering price/(1)/ registration fee
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
Common stock, $.002 par value 12,899,530/(2)/ $ 1.00 $ 12,899,530
- ------------------------------------------------------------------------------------------------------------
Common stock, $.002 par value 6,323,500/(3)/ $ 4.00 $ 25,294,000 $ 10,728
==============================================================================================================================
</TABLE>
(1) Estimated solely for purposes of determining the registration
fee pursuant to Rule 457(a) under the Securities Act of 1933.
(2) Includes 1,040,000 shares to be issued to holders of
Registrant's debentures in connection with its plan of
reorganization.
(3) Includes 2,663,500 shares to be issued to holders of
Registrant's Class A and B warrants and 3,660,000 shares to
be issued to holders of Registrant's options, in such case
upon exercise of those warrants and options at an exercise
price of $4.00 per share.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The following are the estimated expenses for the offering described in the
Registration Statement, all of which will be borne by the Registrant.
<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission fee................... $ 10,728
Accountants' fees........................................ 33,272
Legal fees and expenses.................................. 41,000
Company's administrative expenses........................ 10,000
Printing and engraving.. 1,000
Miscellaneous............................................ 1,000
--------
TOTAL FEES AND EXPENSES.............................. $ 97,000
========
</TABLE>
Item 14. Indemnification of Directors and Officers
Generally, Section 145 of the General Corporation Law of Delaware (the
"GCL") permits a corporation to indemnify certain persons made a party to an
action, because the person is or was a director, officer, employee, or agent of
the corporation or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation or enterprise. In
the case of an action by or in the right of the corporation, no indemnification
may be made for any matter as to which the person was adjudged liable for
negligence or misconduct in the performance of his duty to the corporation
unless the Chancery Court or the court in which the action was brought
determines that, despite the adjudication of liability, the person is fairly and
reasonably entitled to indemnification for proper expenses. If the person has
been successful in the defense of any matter, he shall be indemnified against
his expenses actually and reasonably incurred.
Section 102(b)(7) of the GCL enables a Delaware corporation to include a
provision in its certificate of incorporation limiting a director's liability to
the corporation or its stockholders for monetary damages for breaches of
fiduciary duty as a director. The Registrant's Certificate of Incorporation, as
amended, and Bylaws provide for indemnification of its officers and directors to
the full extent permitted under Delaware law.
Item 15. Recent Sales of Unregistered Securities
On October 22, 1996, the Registrant initiated its offer to exchange
Common Stock, $.002 par value per share ("Common Stock"), and 14 percent
cumulative convertible Preferred Stock, $.002 par value per share ("Preferred
Stock"), for its outstanding Debentures ("Exchange Offer"). The Exchange Offer
expired, and on April 8, 1997, the Registrant issued an aggregate of 1.4 million
shares of its Common Stock and 57,800 shares of its Preferred Stock in exchange
for $7.2 million in principal amount of Debentures and accrued interest thereon.
Pursuant to the Exchange Offer, the Registrant issued 855,205 shares of Common
Stock and 57,800 shares of its Preferred Stock in excess of the original
conversion privilege offered by these Debentures. As a result, the Registrant
recorded during the year ended March 31, 1998, a non-cash transaction: a
conversion charge of $6.3 million, an increase to additional paid-in capital of
$14.5 million, and an increase in the Common Stock of $2,889 and Preferred Stock
of $116. In addition, accrued interest on the Debentures, totaling $1.1 million,
was canceled.
II-1
<PAGE>
No underwriters were used in connection with these transactions. The
issuance of these securities was exempt from registration under the Securities
Act of 1933 pursuant to Section 4(2) thereof because the transactions did not
involve a public offering.
Item 16. Exhibits and Financial Statement Schedules
3.1 Certificate of Incorporation of CAPX Corporation (prior name of
AutoLend Group, Inc.)*
3.2 Certificate of Amendment to the Certificate of Incorporation of CAPX
Corporation, changing name to AutoLend Group, Inc.*
3.3 Bylaws of CAPX Corporation (prior name of AutoLend Group, Inc.)*
5 Form of opinion of Hinkle, Cox, Eaton, Coffield & Hensley, L.L.P.,
as to the legality of the securities being registered.
10.1 Lease Agreement for space at 600 Central S.W., Third Floor,
Albuquerque, New Mexico*
10.2 XXXXX Gaming Lease and Additional Service Agreement****
10.3 XXXXX Gaming Lease and Additional Service Agreement****
10.4 XXXXX Gaming Lease and Additional Service Agreement****
10.5 XXXXX Gaming Lease and Additional Service Agreement****
10.6 XXXXX Gaming Lease and Additional Service Agreement****
10.7 XXXXX Gaming Lease and Additional Service Agreement****
10.8 XXXXX Gaming Lease and Additional Service Agreement****
10.9 XXXXX Gaming Lease and Additional Service Agreement****
10.10 XXXXX Gaming Lease and Additional Service Agreement****
10.11 XXXXX Gaming Lease and Additional Service Agreement****
10.12 XXXXX Gaming Lease and Additional Service Agreement****
10.13 XXXXX Gaming Lease and Additional Service Agreement****
10.14 XXXXX Gaming Lease and Additional Service Agreement****
10.15 XXXXX Gaming Lease and Additional Service Agreement****
21 Subsidiaries of the Registrant*
23.1 Consent of Hinkle, Cox, Eaton, Coffield & Hensley, L.L.P. (included
in Exhibit 5)**
23.2 Consent of Meyners + Company, L.L.C.**
23.3 Consent of KPMG LLP***
* Filed as a corresponding exhibit to Registrant's Annual Report on Form 10-K
for the year ended March 31, 1999
** Filed with Amendment No. 1 to Form S-1
*** Filed with Amendment No. 2 to Form S-1
****Filed herewith - names, dates, and financial terms have been redacted
II-2
<PAGE>
Item 17. Undertakings
The Registrant hereby undertakes:
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers, and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission (the "SEC") such indemnification is against public policy as
expressed in the Act and is therefore unenforceable.
If a claim for indemnification against such liabilities (other than the
Registrant's payment of expenses incurred or paid by its director, officer, or
controlling person in the successful defense of any action, suit, or proceeding)
is asserted by the director, officer, or controlling person in connection with
the securities being registered, the Registrant is required by the SEC, unless
in its counsel's opinion the matter has been settled by controlling precedent,
to submit to a court of appropriate jurisdiction the question whether its
indemnification is against public policy as expressed in the Act, and the
Registrant will be governed by the final adjudication of that issue.
For determining any liability under the Act, the Registrant will treat the
information omitted from the prospectus filed as part of this registration
statement in reliance upon Rule 430A and contained in a form of prospectus filed
by the Registrant under Rule 424(b)(1) or (4), or 497(h) under the Act as part
of this registration statement as of the time the Commission declares it
effective.
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of a prospectus filed with the Commission
pursuant to Rule 425(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in
the maximum aggregate offering price in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to the information in the
registration statement.
(2) That, to determine any liability under the Securities Act of 1933,
each post-effective amendment shall be deemed a new registration
statement relating to the securities offered therein, and the offering
of the securities at that time shall be deemed therein an initial bona
fide offering.
(3) To remove from registration by means of a post-effective amendment any
securities being registered which remain unsold at the termination of
the offering.
II-3
<PAGE>
SIGNATURES
Pursuant to the Securities Act of 1933, the registrant has duly caused this
amendment No. 3 to this registration statement report to be signed on its behalf
by the undersigned thereto duly authorized, in Albuquerque, New Mexico, on
November 18, 1999.
AUTOLEND GROUP, INC.
By: /s/ Nunzio P. DeSantis
---------------------------------
Nunzio P. DeSantis
Chairman of the Board and
Chief Executive Officer
Pursuant to the Securities Act of 1933, this registration statement has
been signed below by the following persons in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Nunzio P. DeSantis Chairman of the Board, November 18, 1999
- ----------------------------------
Nunzio P. DeSantis Chief Executive Officer and Director
(Principal executive officer)
/s/ Jeffrey Ovington Executive Vice President November 18, 1999
- ----------------------------------
Jeffrey Ovington (Principal accounting and
financial officer)
/s/ Phillip J. Vitale, M.D. Director November 18, 1999
- ----------------------------------
Philip J. Vitale, M.D.
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
Exhibit Sequentially
No. Description Numbered Page
- --------------------------------------------------------------------------------
3.1 Certificate of Incorporation of CAPX Corporation
(prior name of AutoLend Group, Inc.)*
3.2 Certificate of Amendment to the Certificate of Incorporation
of CAPX Corporation, changing name to AutoLend Group, Inc.*
3.3 Bylaws of CAPX Corporation (prior name of AutoLend Group, Inc.)*
5 Form of opinion of Hinkle, Cox, Eaton, Coffield & Hensley, L.L.P.,
as to the legality of the securities being registered.
10.1 Lease Agreement for space at 600 Central S.W., Third Floor,
Albuquerque, New Mexico*
10.2 XXXXX Gaming Lease and Additional Service Agreement****
10.3 XXXXX Gaming Lease and Additional Service Agreement****
10.4 XXXXX Gaming Lease and Additional Service Agreement****
10.5 XXXXX Gaming Lease and Additional Service Agreement****
10.6 XXXXX Gaming Lease and Additional Service Agreement****
10.7 XXXXX Gaming Lease and Additional Service Agreement****
10.8 XXXXX Gaming Lease and Additional Service Agreement****
10.9 XXXXX Gaming Lease and Additional Service Agreement****
10.10 XXXXX Gaming Lease and Additional Service Agreement****
10.11 XXXXX Gaming Lease and Additional Service Agreement****
10.12 XXXXX Gaming Lease and Additional Service Agreement****
10.13 XXXXX Gaming Lease and Additional Service Agreement****
10.14 XXXXX Gaming Lease and Additional Service Agreement****
10.15 XXXXX Gaming Lease and Additional Service Agreement****
21 Subsidiaries of the Registrant*
23.1 Consent of Hinkle, Cox, Eaton, Coffield & Hensley, L.L.P.
(included in Exhibit 5)**
23.2 Consent of Meyners + Company, LLC**
23.3 Consent of KPMG LLP***
* Filed as a corresponding exhibit to Registrant's Annual Report on Form 10-K
for the year ended March 31, 1999
** Filed with Amendment No. 1 to Form S-1
*** Filed with Amendment No. 2 to Form S-1
****Filed herewith - names, dates, and financial terms have been redacted
<PAGE>
EXHIBIT 10.2
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico
headquartered company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico
nonprofit organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising
revenues for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply
and assist Proprietor in setting up its gaming machines in strict
accordance with state law upon its licensing as a gaming machine
distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services
("Services") to Proprietor at the location described in Exhibit A ("Premises"),
attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with
State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the
Proprietor to legally and successfully operate its Project in compliance
with state laws;
(4) Service gaming machines on a regular and emergency basis within a
reasonable time period, and provide a toll-free phone number for service
calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such
revenues after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this
Agreement on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be
the exclusive supplier of all gaming equipment permitted by the Gaming Control
Act to Proprietor and to the Premises for the term of this agreement; and
Kachina shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A.
above), Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not
permit fees to be paid to Kachina as described above, Kachina shall have the
option of withdrawing from the agreement, or eliminating some or all
services that are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
Section 15. There are no other fees payable to Kachina other than the percentage
payment set out in this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines
to be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for appropriate
licenses, and any required renewals, in order to be licensed under the Gaming
Control Act for the purpose of conducting gaming as described in the Gaming
Control Act. Such applications shall be filed as soon as practicable after
forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on
<PAGE>
the Premises excluding normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL
USE AND CAUSE ALL EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina, its
members, managers, employees, agents and its respective successors and permitted
assigns harmless from and against all damages, liabilities, obligations,
deficiencies, claims, actions, demands, judgments, interest, losses, diminution
in value, proceedings, costs and expenses, all of whatever kind or nature,
including, without limitation, reasonable attorneys fees and other legal costs
and expenses, incurred by Kachina as a result of Proprietor's failure to comply
with the terms of this Agreement and/or Proprietor's operation of gaming
machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours,
<PAGE>
for the purpose of collecting cash from the machines, maintenance and replacing,
inspecting, or observing the use of the Equipment. However, under no
circumstances may Kachina interfere with the operation of Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
it within 10 days of receipt of notice of said lien. If such lien is not removed
or satisfied within 45 days of its filing, Kachina may terminate this agreement
without further notice, and remove its Equipment. All Equipment shall bear the
name "Kachina Gaming" and shall state thereon that said Equipment is the sole
property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
<PAGE>
Kachina and Proprietor will each maintain separate full and complete books and
records regarding the operation and use of the Property as required by law. Each
party may inspect those books and records of the other party which pertain to
the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
injunction requiring compliance with the terms of this Agreement. The parties
hereto agree that the proper jurisdiction and venue for any action in court to
enforce or interpret this Agreement shall be the Second Judicial District of New
Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign
<PAGE>
this Agreement to any third party. If Proprietor relocates its business or
nonprofit operations, Proprietor shall allow Kachina, at its option and expense,
to transport Kachina's Equipment (or to deliver similar Equipment) to the new
location, under the same terms and condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory hereof
on its behalf has full, lawful authority to enter into this agreement. The
parties further certify that there are no reservations or understandings except
as provided in this Agreement. Any prior statements, offers, representations or
understandings are deemed a matter of negotiation only and are merged into this
Agreement which contains the only agreement between the parties regarding the
subject matter described herein. Proprietor further certifies that there are no
contracts or agreements with any other party regarding the subject matter
herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual receipt of notice of the
breach or in such other time as may be reasonable given the nature of the
default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the
<PAGE>
address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez (signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.3
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico
headquartered company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico
nonprofit organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising
revenues for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply
and assist Proprietor in setting up its gaming machines in strict
accordance with state law upon its licensing as a gaming machine
distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services
("Services") to Proprietor at the location described in Exhibit A ("Premises"),
attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the
Proprietor to legally and successfully operate its Project in compliance
with state laws;
(4) Service gaming machines on a regular and emergency basis within a
reasonable time period, and provide a toll-free phone number for service
calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such
revenues after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this
Agreement on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier.
Kachina shall be the exclusive supplier of all gaming equipment permitted by the
Gaming Control Act to Proprietor and to the Premises for the term of this
agreement; and Kachina shall have exclusive access to the coin and currency
boxes on all gaming machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A.
above), Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina
another XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not
permit fees to be paid to Kachina as described above, Kachina shall have
the option of withdrawing from the agreement, or eliminating some or all
services that are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines
to be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment.
<PAGE>
However, under no circumstances may Kachina interfere with the operation of
Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use
<PAGE>
of the Property upon reasonable written notice to that party. Reasonable notice
is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to
<PAGE>
deliver similar Equipment) to the new location, under the same terms and
condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further
provided that the breaching party has failed to cure the breach within 20
days of actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
<PAGE>
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez (signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name(Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.4
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico
headquartered company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico
nonprofit organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising
revenues for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply
and assist Proprietor in setting up its gaming machines in strict
accordance with state law upon its licensing as a gaming machine
distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services
("Services") to Proprietor at the location described in Exhibit A ("Premises"),
attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the
Proprietor to legally and successfully operate its Project in compliance
with state laws;
(4) Service gaming machines on a regular and emergency basis within a
reasonable time period, and provide a toll-free phone number for service
calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such
revenues after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this
Agreement on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier.
Kachina shall be the exclusive supplier of all gaming equipment permitted by the
Gaming Control Act to Proprietor and to the Premises for the term of this
agreement; and Kachina shall have exclusive access to the coin and currency
boxes on all gaming machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A.
above), Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in
1.B. above, or elsewhere in this agreement), Proprietor shall pay Kachina
another XXXXX of Net Revenues collected.
<PAGE>
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not
permit fees to be paid to Kachina as described above, Kachina shall have
the option of withdrawing from the agreement, or eliminating some or all
services that are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
Section 15. There are no other fees payable to Kachina other than the percentage
payment set out in this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines
to be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for appropriate
licenses, and any required renewals, in order to be licensed under the Gaming
Control Act for the purpose of conducting gaming as described in the Gaming
Control Act. Such applications shall be filed as soon as practicable after
forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its
<PAGE>
respective successors and permitted assigns harmless from and against all
damages, liabilities, obligations, deficiencies, claims, actions, demands,
judgments, interest, losses, diminution in value, proceedings, costs and
expenses, all of whatever kind or nature, including, without limitation,
reasonable attorneys fees and other legal costs and expenses, incurred by
Kachina as a result of Proprietor's failure to comply with the terms of this
Agreement and/or Proprietor's operation of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under
<PAGE>
this Agreement is Kachina's sole and exclusive property. Proprietor further
warrants that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
it within 10 days of receipt of notice of said lien. If such lien is not removed
or satisfied within 45 days of its filing, Kachina may terminate this agreement
without further notice, and remove its Equipment. All Equipment shall bear the
name "Kachina Gaming" and shall state thereon that said Equipment is the sole
property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books and
records regarding the operation and use of the Property as required by law. Each
party may inspect those books and records of the other party which pertain to
the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not
<PAGE>
knowingly do any act which will cause the leased Property of Kachina to be
confiscated or appropriated by any agency of the State of New Mexico, or any
other government-related agency. In the event any of the Property leased
hereunder is confiscated or appropriated by any such agency, then the Proprietor
shall be responsible to Kachina for the value of the leased Property confiscated
or appropriated, and for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
injunction requiring compliance with the terms of this Agreement. The parties
hereto agree that the proper jurisdiction and venue for any action in court to
enforce or interpret this Agreement shall be the Second Judicial District of New
Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid
<PAGE>
or unenforceable for any reason, the remaining provisions shall be given full
force and effect. This Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual receipt of notice of the
breach or in such other time as may be reasonable given the nature of the
default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
<PAGE>
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez(signed and typed) By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name(Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.5
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
<PAGE>
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
Section 15. There are no other fees payable to Kachina other than the percentage
payment set out in this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its
<PAGE>
respective successors and permitted assigns harmless from and against all
damages, liabilities, obligations, deficiencies, claims, actions, demands,
judgments, interest, losses, diminution in value, proceedings, costs and
expenses, all of whatever kind or nature, including, without limitation,
reasonable attorneys fees and other legal costs and expenses, incurred by
Kachina as a result of Proprietor's failure to comply with the terms of this
Agreement and/or Proprietor's operation of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under
<PAGE>
this Agreement is Kachina's sole and exclusive property. Proprietor further
warrants that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
it within 10 days of receipt of notice of said lien. If such lien is not removed
or satisfied within 45 days of its filing, Kachina may terminate this agreement
without further notice, and remove its Equipment. All Equipment shall bear the
name "Kachina Gaming" and shall state thereon that said Equipment is the sole
property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not
<PAGE>
knowingly do any act which will cause the leased Property of Kachina to be
confiscated or appropriated by any agency of the State of New Mexico, or any
other government-related agency. In the event any of the Property leased
hereunder is confiscated or appropriated by any such agency, then the Proprietor
shall be responsible to Kachina for the value of the leased Property confiscated
or appropriated, and for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
injunction requiring compliance with the terms of this Agreement. The parties
hereto agree that the proper jurisdiction and venue for any action in court to
enforce or interpret this Agreement shall be the Second Judicial District of New
Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid
<PAGE>
or unenforceable for any reason, the remaining provisions shall be given full
force and effect. This Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual receipt of notice of the
breach or in such other time as may be reasonable given the nature of the
default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
<PAGE>
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez(signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
XXXXX
Trustee
<PAGE>
EXHIBIT 10.6
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
<PAGE>
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
<PAGE>
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
<PAGE>
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further
provided that the breaching party has failed to cure the breach within 20
days of actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
<PAGE>
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed)By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name(Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.7
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming
machines; state reporting requirements; and other subjects required for
the Proprietor to legally and successfully operate its Project in
compliance with state laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
<PAGE>
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
<PAGE>
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
<PAGE>
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further
provided that the breaching party has failed to cure the breach within 20
days of actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
<PAGE>
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.8
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not
permit fees to be paid to Kachina as described above, Kachina shall have the
option of withdrawing from the agreement, or eliminating some or all
services that are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment.
<PAGE>
However, under no circumstances may Kachina interfere with the operation of
Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use
<PAGE>
of the Property upon reasonable written notice to that party. Reasonable notice
is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to
<PAGE>
deliver similar Equipment) to the new location, under the same terms and
condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid
or unenforceable for any reason, the remaining provisions shall be
given full force and effect. This Agreement shall be irrevocable by the parties
hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further
provided that the breaching party has failed to cure the breach within 20
days of actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
<PAGE>
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-1111 Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.9
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following
services ("Services") to Proprietor at the location described in
Exhibit A ("Premises"), attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier.
Kachina shall be the exclusive supplier of all gaming equipment
permitted by the Gaming Control Act to Proprietor and to the
Premises for the term of this agreement; and Kachina shall have
exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
<PAGE>
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
Section 15. There are no other fees payable to Kachina other than the percentage
payment set out in this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify
Kachina for damages to or destruction of Kachina's Equipment on
the Premises excluding normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL
USE AND CAUSE ALL EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its
<PAGE>
respective successors and permitted assigns harmless from and against all
damages, liabilities, obligations, deficiencies, claims, actions, demands,
judgments, interest, losses, diminution in value, proceedings, costs and
expenses, all of whatever kind or nature, including, without limitation,
reasonable attorneys fees and other legal costs and expenses, incurred by
Kachina as a result of Proprietor's failure to comply with the terms of this
Agreement and/or Proprietor's operation of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
The policy shall provide that it shall not be canceled without at least 30 day
written notice to Kachina.
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under
<PAGE>
this Agreement is Kachina's sole and exclusive property. Proprietor further
warrants that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
shall notify Kachina and take immediate steps to remove or satisfy it within 10
days of receipt of notice of said lien. If such lien is not removed or satisfied
within 45 days of its filing, Kachina may terminate this agreement without
further notice, and remove its Equipment. All Equipment shall bear the name
"Kachina Gaming" and shall state thereon that said Equipment is the sole
property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not
<PAGE>
knowingly do any act which will cause the leased Property of Kachina to be
confiscated or appropriated by any agency of the State of New Mexico, or any
other government-related agency. In the event any of the Property leased
hereunder is confiscated or appropriated by any such agency, then the Proprietor
shall be responsible to Kachina for the value of the leased Property confiscated
or appropriated, and for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
of competent jurisdiction and obtain a restraining order and/or injunction
requiring compliance with the terms of this Agreement. The parties hereto agree
that the proper jurisdiction and venue for any action in court to enforce or
interpret this Agreement shall be the Second Judicial District of New Mexico,
Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid
<PAGE>
or unenforceable for any reason, the remaining provisions shall be given full
force and effect. This Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual receipt of notice of the
breach or in such other time as may be reasonable given the nature of the
default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
<PAGE>
Fx. (505) 768-llll Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez (signed and typed) By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name(Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.10
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following
services ("Services") to Proprietor at the location described in
Exhibit A ("Premises"), attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 8
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A.
above), Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
<PAGE>
However, in the event that Proprietor's total income from gaming might
otherwise exceed its revenue derived from fraternal sources (as those
italicized terms are defined in the Gaming Policy of XXXXX, and any other
internal rules or bylaws, etc., of XXXXX), and further subject to the
maximums and other regulations of the NM Gaming Control Board, then the ten
percent payment of this section 2.B shall be increased to the extent
necessary or possible to diminish this excess, in keeping with XXXXX
policies.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and
Gaming Machine Lease & Additional Service Agreement Page # 3 of 8
regulations do not permit fees to be paid to Kachina as described above, Kachina
shall have the option of withdrawing from the agreement, or eliminating some or
all services that are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate the
lease; lease termination shall be governed by Section 15. There are no other
fees payable to Kachina other than the percentage payment set out in this
Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written
<PAGE>
notice of renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 8
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure and maintain liability insurance, and shall furnish
Kachina with a copy of said policy. Proprietor shall secure and maintain
comprehensive hazard insurance (covering fire, theft, damage, etc.) To
adequately cover all equipment and furnishings of the Premises, including the
gaming machines and Equipment provided under this Agreement, and shall include
Kachina as an additional named insured under such policy, and shall provide
Kachina with a copy of such policy. Kachina will reimburse insurance company
specifically for adding Kachina as an additional named insured on the hazard
policy; such annual cost is estimated by Proprietor (after discussion with its
insurance agent) to be approximately XXXXX per year.
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
<PAGE>
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours,
Gaming Machine Lease & Additional Service Agreement Page # 5 of 8
for the purpose of collecting cash from the machines, maintenance and replacing,
inspecting, or observing the use of the Equipment. However, under no
circumstances may Kachina interfere with the operation of Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina may terminate this agreement without further notice, and remove
its Equipment. All Equipment shall bear the name "Kachina Gaming" and shall
state thereon that said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is
<PAGE>
obtained in writing from Kachina, which may withhold such permission in its sole
discretion for any reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books
Gaming Machine Lease & Additional Service Agreement Page # 6 of 8
and records of the other party which pertain to the operation and use of the
Property upon reasonable written notice to that party. Reasonable notice is a
minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for any action in court to enforce or interpret this Agreement shall be
the Second Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement.
<PAGE>
The court will also award attorneys fees, costs, and pre and post judgment
interest at the post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
Gaming Machine Lease & Additional Service Agreement Page # 7 of 8
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual receipt of notice of the
breach or in such other time as may be reasonable given the nature of the
default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to
<PAGE>
Proprietor; in such case, Kachina shall have a one-time option to
unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
Gaming Machine Lease & Additional Service Agreement Page # 7 of 8
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: J. Ovington (signed and typed) By: XXXXX
(signed)
Executive Vice President (for F. Chavez) Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
Date: XXXXX
<PAGE>
EXHIBIT 10.11
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
Gaming Machine Lease & Additional Service Agreement Page # 2 of 8
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina XXXXX of
Net Revenues collected.
<PAGE>
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 8
Proprietor shall not be required to make a per machine payment to terminate the
lease; lease termination shall be governed by Section 15. There are no other
fees payable to Kachina other than the percentage payment set out in this
Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
If Proprietor fails to comply with the terms of this Agreement and as a result
Kachina incurs damages or costs, or , if Proprietor operates the gaming machines
or premises in a fashion which results
<PAGE>
in Kachina incurring damages or costs, then, in either of these cases,
Proprietor will hold Kachina (and its members, managers, employees, agents and
its respective successors and permitted assigns) harmless from and against all
damages, liabilities, obligations, deficiencies, claims, actions, demands,
judgments, interest, losses, diminution in value, proceedings, costs and
expenses, all of whatever kind or nature, including, without limitation,
reasonable attorneys fees and other legal costs and expenses.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 8
Proprietor shall secure and maintain liability insurance in an appropriate
amount, and will demonstrate the existence of such coverage to Kachina.
Proprietor shall also maintain hazard insurance to provide coverage for loss or
damage of Proprietor's equipment and furnishings within the premises. At
Proprietor's sole discretion, Proprietor may choose to broaden such hazard
coverage to include Kachina's gaming machines, then to the extent that the
coverage inclusion of Kachina's machines and equipment increases Proprietor's
hazard policy premiums, Kachina shall reimburse Proprietor for such directly
attributable premium increase.
6. Modification, Illegality and Severability. If the rules and regulations under
the Gaming Control Act or of the Gaming Control Board or other local, state or
federal law or regulations, be such that any provisions herein may be deemed
invalid, then the parties agree to modify the Lease as necessary to bring it
into conformity with those rules and regulations, while maintaining the intent
of the parties to the Lease. Any such modification will not affect the remaining
provisions of the Lease. This agreement shall not be effective until it is
reviewed and approved (either specifically or in generic form) by the New Mexico
Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance
<PAGE>
and replacing, inspecting, or observing the use of the Equipment. However, under
no circumstances may Kachina interfere with the operation of Proprietor's
business.
8. Ownership. Proprietor warrants that the Equipment leased under this Agreement
is Kachina's sole and exclusive property. Proprietor further warrants that the
Equipment will be located at
Gaming Machine Lease & Additional Service Agreement Page # 5 of 8
the address first set out above. Proprietor shall have no right or interest in
such Property except as expressly set forth in this Lease. Proprietor shall not
mortgage or encumber the Equipment at any time. If Proprietor leases its
premises from a third party, then Proprietor will use its best efforts to obtain
a Landlord's Lien Waiver with respect to the Equipment. A separate document
providing for such waiver will be provided by Kachina. Any new premises lease
entered into by Proprietor after the execution of this Agreement shall be
required to include such a Landlord's Lien wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina may terminate this agreement without further notice, and remove
its Equipment. All Equipment shall bear the name "Kachina Gaming" and shall
state thereon that said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and
<PAGE>
records of the other party which pertain to the operation and use of the
Property upon reasonable written notice to that party. Reasonable notice is a
minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In
Gaming Machine Lease & Additional Service Agreement Page # 6 of 8
the event any of the Property leased hereunder is confiscated or appropriated by
any such agency, then the Proprietor shall be responsible to Kachina for the
value of the leased Property confiscated or appropriated, and for any loss of
earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
of competent jurisdiction and obtain a restraining order and/or injunction
requiring compliance with the terms of this Agreement. The parties hereto agree
that the proper jurisdiction and venue for any action in court to enforce or
interpret this Agreement shall be the Second Judicial District of New Mexico,
Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and/or remove all Equipment without interference from Proprietor or
its members. In the event that Proprietor were to breech this Agreement AND
engage in gaming without Kachina, then in such case Kachina shall be entitled to
-------
receive a specific penalty payment from Proprietor. Such a penalty shall be
calculated by computing Kachina's average weekly revenues under this Agreement
(prior to said breach), which average shall then be multiplied by the number of
weeks remaining in the unexpired term of this Agreement. In the case of any
dispute which is ultimately resolved by a court, the prevailing party shall be
entitled to attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate. No damages or penalties of any kind will be in
----------------------------------------------
effect under specific situations (described herein) wherein Proprietor no longer
- --------------------------------------------------------------------------------
engages in gaming:
- -----------------
<PAGE>
if Proprietor's national XXXXX umbrella organization closes down Proprietor or
closes gaming by Proprietor; or, if the physical facility becomes unusable due
to some form of destruction; or, if Proprietor is forced to close for financial,
legal, or other reasons. However, if any of the above exceptions occur, and then
Proprietor later re-engages in gaming, then at such time this Agreement will
again become active and in effect, with as many months then remaining as were
remaining when gaming stopped under Kachina.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina
Gaming Machine Lease & Additional Service Agreement Page # 7 of 8
during the term of this Agreement. Proprietor shall not assign this Agreement to
any third party. If Proprietor relocates its business or nonprofit operations,
Proprietor shall allow Kachina, at its option and expense, to transport
Kachina's Equipment (or to deliver similar Equipment) to the new location, under
the same terms and condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting
party to cure the breach; and further provided that the breaching party has
failed to cure the breach within 20 days of actual
<PAGE>
receipt of notice of the breach or in such other time as may be reasonable given
the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
Gaming Machine Lease & Additional Service Agreement Page # 8 of 8
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-1111 Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez(signed and typed) By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
Date: XXXXX
<PAGE>
EXHIBIT 10.12
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment.
<PAGE>
However, under no circumstances may Kachina interfere with the operation of
Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use
<PAGE>
of the Property upon reasonable written notice to that party. Reasonable notice
is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to
<PAGE>
deliver similar Equipment) to the new location, under the same terms and
condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further provided
that the breaching party has failed to cure the breach within 20 days of
actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
<PAGE>
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-1111 Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
Organization
By: Fred A. Chavez(signed and typed) By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
Date: XXXXXX
<PAGE>
EXHIBIT 10.13
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX day of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming
Gaming Machine Lease & Additional Service Agreement Page # 2 of 7
machine layout in compliance with State laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
<PAGE>
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor shall pay Kachina another
XXXXX of Net Revenues collected.
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 7
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines
to be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
4. Term. The initial term of this agreement shall be for XXXXX months from the
date first written above. This agreement will automatically renew for XXXXX and
upon the same terms and conditions unless, at least 60 days before the end of
the initial term, one party provides the other with written notice of
renegotiation or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the Premises excluding
normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE AND CAUSE ALL
EQUIPMENT TO BE USED IN A LAWFUL MANNER.
<PAGE>
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
Gaming Machine Lease & Additional Service Agreement Page # 4 of 7
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment.
<PAGE>
However, under no circumstances may Kachina interfere with the operation of
Proprietor's business.
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina
Gaming Machine Lease & Additional Service Agreement Page # 5 of 7
may terminate this agreement without further notice, and remove its Equipment.
All Equipment shall bear the name "Kachina Gaming" and shall state thereon that
said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or contrivances which feature gambling methods, nor place upon
its premises any form of such equipment which would compete with the purpose,
use, or operation of the Equipment, unless permission is obtained in writing
from Kachina, which may withhold such permission in its sole discretion for any
reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use
<PAGE>
of the Property upon reasonable written notice to that party. Reasonable notice
is a minimum of seven (7) days.
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for
Gaming Machine Lease & Additional Service Agreement Page # 6 of 7
any action in court to enforce or interpret this Agreement shall be the Second
Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be entitled to liquidated damages in an amount equal
to Kachina's average weekly revenues, prior to said breach, multiplied by the
number of weeks remaining in the unexpired term of this Agreement. The court
will also award attorneys fees, costs, and pre and post judgment interest at the
post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to
<PAGE>
deliver similar Equipment) to the new location, under the same terms and
condition set forth in this Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be given full force and effect. This
Agreement shall be irrevocable by the parties hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further provided
that the breaching party has failed to cure the breach within 20 days of
actual receipt of notice of the breach or in such
Gaming Machine Lease & Additional Service Agreement Page # 7 of 7
other time as may be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna provides a minimum of 90 days
advance written notice to Proprietor; in such case, Kachina shall have a
one-time option to unilaterally terminate this agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
<PAGE>
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-1111 Fx. XXXXX
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
<PAGE>
EXHIBIT 10.14
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services ("Services")
to Proprietor at the location described in Exhibit A ("Premises"), attached to
this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
Gaming Machine Lease & Additional Service Agreement Page # 2 of 8
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be the
exclusive supplier of all gaming equipment permitted by the Gaming Control Act
to Proprietor and to the Premises for the term of this agreement; and Kachina
shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor
<PAGE>
shall pay Kachina XXXXX of Net Revenues collected. However, in the event that
Proprietor's total income from gaming might otherwise exceed its revenue
derived from fraternal sources (as those italicized terms are defined in the
Gaming Policy of XXXXX, and any other internal rules or bylaws, etc., of
XXXXX), and further subject to the maximums and other regulations of the NM
Gaming Control Board, then the ten percent payment of this section 2.B shall
be increased to the extent necessary or possible to diminish this excess, in
keeping with XXXXX policies.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 8
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option of
withdrawing from the agreement, or eliminating some or all services that are not
specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate the
lease; lease termination shall be governed by
Section 15. There are no other fees payable to Kachina other than the percentage
payment set out in this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines to
be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
Proprietor warrants that it has complied with all its own applicable
internal policies and procedures, including those of XXXXX, that would effect
the execution and binding nature of this contract. Not limiting the above,
Proprietor hereby specifically represents that it has sent a "dispensation to
approve" letter to the General Governor, and that the national office of the
General Governor has in turn granted Proprietor
<PAGE>
permission to execute and make binding this Agreement.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the
Gaming Machine Lease & Additional Service Agreement Page # 4 of 8
Premises excluding normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE
AND CAUSE ALL EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
<PAGE>
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
Gaming Machine Lease & Additional Service Agreement Page # 5 of 8
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina may terminate this agreement without further notice, and remove
its Equipment. All Equipment shall bear the name "Kachina Gaming" and shall
state thereon that said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or
<PAGE>
contrivances which feature gambling methods, nor place upon its premises any
form of such equipment which would compete with the purpose, use, or operation
of the Equipment, unless permission is obtained in writing from Kachina, which
may withhold such permission in its sole discretion for any reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
Gaming Machine Lease & Additional Service Agreement Page # 6 of 8
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for any action in court to enforce or interpret this Agreement shall be
the Second Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be
<PAGE>
entitled to liquidated damages in an amount equal to Kachina's average weekly
revenues, prior to said breach, multiplied by the number of weeks remaining in
the unexpired term of this Agreement. The court will also award attorneys fees,
costs, and pre and post judgment interest at the post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be
Gaming Machine Lease & Additional Service Agreement Page # 7 of 8
given full force and effect. This Agreement shall be irrevocable by the parties
hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further
provided that the breaching party has failed to cure the breach within 20
days of actual receipt of notice of the breach or in such other time as may
be reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna
<PAGE>
provides a minimum of 90 days advance written notice to Proprietor; in such
case, Kachina shall have a one-time option to unilaterally terminate this
agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-llll Fx. XXXXX
Gaming Machine Lease & Additional Service Agreement Page # 8 of 8
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed)By: XXXXX(signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name(Printed)
XXXXX
Title
Date: XXXXX
<PAGE>
EXHIBIT 10.15
GAMING MACHINE LEASE AND ADDITIONAL SERVICE AGREEMENT
THIS AGREEMENT is made this XXXXX of XXXXX XXXXX, by and between
KACHINA GAMING, a division of AutoLend Group, Inc., a New Mexico headquartered
company ("Kachina" or "Lessor"), and the XXXXX, a New Mexico nonprofit
organization ("Proprietor" or "Lessee"), located at XXXXX.
Preliminary Statement
The State of New Mexico ("State") has adopted the Gaming Control Act which
permits certain nonprofit organizations within the state to possess and
operate gaming machines on their premises for the purpose of raising revenues
for educational and other purposes.
Proprietor is an organization established under New Mexico law which is
qualified to participate in the State's gaming program as a state operator
upon licensing by the State.
Kachina is willing to provide gaming equipment; is familiar with New Mexico
state laws and regulations pertaining to gaming operations, gaming facility
design and set up, and licensing; and has sufficient resources to supply and
assist Proprietor in setting up its gaming machines in strict accordance with
state law upon its licensing as a gaming machine distributor by the State.
Proprietor desires to retain Kachina to assist in setting up its gaming
machine operation ("Project") and provide all gaming equipment.
NOW THEREFORE, in consideration of the mutual promises and undertakings set
forth below, the adequacy and sufficiency of which as consideration to
establish a legally binding contract is expressly acknowledged by both
parties, the parties agree as follows:
1. Kachina's Services. Kachina will provide the following services
("Services") to Proprietor at the location described in Exhibit A ("Premises"),
attached to this agreement:
A. Lease and deliver gaming laboratory approved gaming machines, computer
software and related equipment, Exhibit B ("Equipment") for Proprietor's
Project;
B. Provide additional services from the following list;
<PAGE>
Gaming Machine Lease & Additional Service Agreement Page # 2 of 8
(1) Assist Proprietor in securing all required licenses for its Project;
(2) Work with Proprietor to determine the appropriate mix, number and type of
gaming machines and design a gaming machine layout in compliance with State
laws and regulations;
(3) Provide training to the Proprietor with regard to compliance with state
laws, rules and regulations; operation and maintenance of gaming machines;
state reporting requirements; and other subjects required for the Proprietor
to legally and successfully operate its Project in compliance with state
laws;
(4) Service gaming machines on a regular and emergency basis within a reasonable
time period, and provide a toll-free phone number for service calls;
(5) Assist Proprietor in preparing reports as required by the State;
(6) Collect gaming machine revenues and pay over to Proprietor all such revenues
after deducting taxes and Kachina's fees as set forth below;
(7) Reimburse Proprietor for state license fees, background investigation fees,
operator license fees and work permit fees during the term of this Agreement
on the gaming equipment furnished to Proprietor;
(8) Provide a "house bank loan" if needed;
(9) Provide a loan for facility improvement to ensure the facility meets all
regulatory requirements.
2. Fees to Kachina as Exclusive Gaming Equipment Supplier. Kachina shall be
the exclusive supplier of all gaming equipment permitted by the Gaming Control
Act to Proprietor and to the Premises for the term of this agreement; and
Kachina shall have exclusive access to the coin and currency boxes on all gaming
machines upon the Premises. Fees shall be as follows:
A. In exchange for the delivery and lease of the machines (as in 1.A. above),
Proprietor shall pay Kachina XXXXX of Net Revenues collected.
B. In exchange for any or all of Kachina's additional services (as in 1.B.
above, or elsewhere in this agreement), Proprietor
<PAGE>
shall pay Kachina XXXXX of Net Revenues collected. However, in the event that
Proprietor's total income from gaming might otherwise exceed its revenue
derived from fraternal sources (as those italicized terms are defined in the
Gaming Policy of XXXXX, and any other internal rules or bylaws, etc., of
XXXXX), and further subject to the maximums and other regulations of the NM
Gaming Control Board, then the ten percent payment of this section 2.B shall
be increased to the extent necessary or possible to diminish this excess, in
keeping with XXXXX policies.
Gaming Machine Lease & Additional Service Agreement Page # 3 of 8
"Net Revenues" means the total amount of money wagered less pay out of all
prizes and New Mexico Gaming Taxes. If State law and regulations do not permit
fees to be paid to Kachina as described above, Kachina shall have the option
of withdrawing from the agreement, or eliminating some or all services that
are not specifically detailed in 1.A. above.
Proprietor shall not be required to make a per machine payment to terminate
the lease; lease termination shall be governed by Section 15. There are no
other fees payable to Kachina other than the percentage payment set out in
this Section.
3. Proprietor's Responsibilities. Proprietor shall allow the gaming machines
to be placed in prominent places within the Premises as soon as such gaming
machines are delivered by Kachina. Proprietor shall provide a comfortable,
secure gaming environment and be open during all legal gaming hours at its sole
expense. Proprietor shall furnish Kachina all necessary electrical outlets and
electricity for the operation of its Equipment at Proprietor's sole expense. In
the event any of the Equipment becomes inoperable, Proprietor agrees to notify
Kachina immediately in order for Kachina to provide service to the Equipment or
to replace the Equipment with the same or similar kind or quality of Equipment.
Kachina and Proprietor shall apply to the Gaming Control Board for
appropriate licenses, and any required renewals, in order to be licensed under
the Gaming Control Act for the purpose of conducting gaming as described in the
Gaming Control Act. Such applications shall be filed as soon as practicable
after forms, rules, and regulations are adopted by the Gaming Control Board.
Proprietor warrants that it has complied with all its own applicable
internal policies and procedures, including those of XXXXX, that would effect
the execution and binding nature of this contract. Not limiting the above,
Proprietor hereby specifically represents that it has sent a "dispensation to
approve" letter to the General Governor, and that the national office of the
General Governor has in turn granted Proprietor
<PAGE>
permission to execute and make binding this Agreement.
4. Term. The initial term of this agreement shall be for XXXXX from the date
first written above. This agreement will automatically renew for XXXXX and upon
the same terms and conditions unless, at least 60 days before the end of the
initial term, one party provides the other with written notice of renegotiation
or cancellation of this agreement.
5. Indemnification and Insurance. Proprietor agrees to indemnify Kachina for
damages to or destruction of Kachina's Equipment on the
Gaming Machine Lease & Additional Service Agreement Page # 4 of 8
Premises excluding normal wear and tear. PROPRIETOR WARRANTS THAT IT WILL USE
AND CAUSE ALL EQUIPMENT TO BE USED IN A LAWFUL MANNER.
Proprietor now and at all times hereafter, agrees to and does hold Kachina,
its members, managers, employees, agents and its respective successors and
permitted assigns harmless from and against all damages, liabilities,
obligations, deficiencies, claims, actions, demands, judgments, interest,
losses, diminution in value, proceedings, costs and expenses, all of whatever
kind or nature, including, without limitation, reasonable attorneys fees and
other legal costs and expenses, incurred by Kachina as a result of Proprietor's
failure to comply with the terms of this Agreement and/or Proprietor's operation
of gaming machines on its Premises.
Proprietor shall secure comprehensive liability insurance in the minimum
amount of XXXXX per occurrence and XXXXX aggregate from an insurance company
reasonably acceptable to Kachina. Kachina shall be named as an additional named
insured. The policy shall provide that it shall not be canceled without at least
30 day written notice to Kachina.
6. Modification, Illegality and Severability. If the rules and regulations
under the Gaming Control Act or of the Gaming Control Board or other local,
state or federal law or regulations, be such that any provisions herein may be
deemed invalid, then the parties agree to modify the Lease as necessary to bring
it into conformity with those rules and regulations, while maintaining the
intent of the parties to the Lease. Any such modification will not affect the
remaining provisions of the Lease. This agreement shall not be effective until
it is reviewed and approved (either specifically or in generic form) by the New
Mexico Gaming Control Board, in accordance with rule 15 NMAC 1.10.32.4.
<PAGE>
7. Service, Observation, and Quantity of Machines. Kachina shall service and
maintain the Equipment and keep it in operable condition. Proprietor shall not
open the gaming devices, physically extract money or tokens from them, or
otherwise tamper with them in any manner.
Kachina maintains the right to decide to repair or replace machines. Lessor
shall decide if the usage volume for the location justifies keeping the maximum
number of machines as permitted by law or if fewer machines is appropriate in
the circumstances.
Kachina and its agents and employees shall have the right to enter into and
upon the Proprietor's premises where the Equipment is located, at all reasonable
times during normal business hours, for the purpose of collecting cash from the
machines, maintenance and replacing, inspecting, or observing the use of the
Equipment. However, under no circumstances may Kachina interfere with the
operation of Proprietor's business.
Gaming Machine Lease & Additional Service Agreement Page # 5 of 8
8. Ownership. Proprietor warrants that the Equipment leased under this
Agreement is Kachina's sole and exclusive property. Proprietor further warrants
that the Equipment will be located at the address first set out above.
Proprietor shall have no right or interest in such Property except as expressly
set forth in this Lease. Proprietor shall not mortgage or encumber the Equipment
at any time. If Proprietor leases its premises from a third party, then
Proprietor will use its best efforts to obtain a Landlord's Lien Waiver with
respect to the Equipment. A separate document providing for such waiver will be
provided by Kachina. Any new premises lease entered into by Proprietor after the
execution of this Agreement shall be required to include such a Landlord's Lien
wavier.
Proprietor shall not allow a lien of any nature whatsoever to be filed or
maintained against the Equipment or gaming revenues. If any lien is filed in
contravention of this provision, Proprietor shall notify Kachina and take
immediate steps to remove or satisfy it within 10 days of receipt of notice of
said lien. If such lien is not removed or satisfied within 45 days of its
filing, Kachina may terminate this agreement without further notice, and remove
its Equipment. All Equipment shall bear the name "Kachina Gaming" and shall
state thereon that said Equipment is the sole property of Kachina Gaming.
9. Competitive Equipment. During the term of the Lease, or any renewal term
thereof, Proprietor will not enter into any other agreement, lease, purchase
order, or contract of any kind with any other manufacturer, distributor,
supplier, lessor, or vendor of gaming devices, gaming machines, or any other
type of machines or
<PAGE>
contrivances which feature gambling methods, nor place upon its premises any
form of such equipment which would compete with the purpose, use, or operation
of the Equipment, unless permission is obtained in writing from Kachina, which
may withhold such permission in its sole discretion for any reason.
10. Records. The State of New Mexico will require that the gaming devices and
gaming machines be connected to its central accounting system which monitors the
operation of those devices and machines. Proprietor agrees it will cooperate
fully with the State (or any of its agencies) and with Kachina in facilitating
this connection.
Kachina and Proprietor will each maintain separate full and complete books
and records regarding the operation and use of the Property as required by law.
Each party may inspect those books and records of the other party which pertain
to the operation and use of the Property upon reasonable written notice to that
party. Reasonable notice is a minimum of seven (7) days.
Gaming Machine Lease & Additional Service Agreement Page # 6 of 8
11. Compliance with Gaming Laws. Proprietor warrants it shall not knowingly do
any act which will cause the leased Property of Kachina to be confiscated or
appropriated by any agency of the State of New Mexico, or any other government-
related agency. In the event any of the Property leased hereunder is confiscated
or appropriated by any such agency, then the Proprietor shall be responsible to
Kachina for the value of the leased Property confiscated or appropriated, and
for any loss of earnings under this Agreement.
12. Remedies. Both parties acknowledge the remedies at law for breach of this
agreement are inadequate given the highly competitive nature of the gaming
machine industry, and the difficulty of finding alternate locations not
committed to existing agreements. Proprietor further acknowledges the unique
nature of this location. Proprietor further acknowledges that the loss of this
location will result in irreparable harm to Kachina. As a result, the parties
agree that either party may petition a court of competent jurisdiction and
obtain a restraining order and/or injunction requiring compliance with the terms
of this Agreement. The parties hereto agree that the proper jurisdiction and
venue for any action in court to enforce or interpret this Agreement shall be
the Second Judicial District of New Mexico, Bernadillo County, New Mexico.
Notwithstanding the foregoing, in the event of a breach by Proprietor, in
addition to any other remedy available, Kachina may elect to terminate this
Agreement and remove all Equipment without interference from Proprietor or its
member; and Kachina shall be
<PAGE>
entitled to liquidated damages in an amount equal to Kachina's average weekly
revenues, prior to said breach, multiplied by the number of weeks remaining in
the unexpired term of this Agreement. The court will also award attorneys fees,
costs, and pre and post judgment interest at the post judgment interest rate.
13. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns.
Kachina may assign this Agreement without limitation and Proprietor agrees to
any assignment by Kachina during the term of this Agreement. Proprietor shall
not assign this Agreement to any third party. If Proprietor relocates its
business or nonprofit operations, Proprietor shall allow Kachina, at its option
and expense, to transport Kachina's Equipment (or to deliver similar Equipment)
to the new location, under the same terms and condition set forth in this
Agreement.
14. Miscellaneous Terms. In the event that a court of competent jurisdiction
declares any of the conditions or terms herein invalid or unenforceable for any
reason, the remaining provisions shall be
Gaming Machine Lease & Additional Service Agreement Page # 7 of 8
given full force and effect. This Agreement shall be irrevocable by the parties
hereto.
Each party to this Agreement warrants and represents that the signatory
hereof on its behalf has full, lawful authority to enter into this agreement.
The parties further certify that there are no reservations or understandings
except as provided in this Agreement. Any prior statements, offers,
representations or understandings are deemed a matter of negotiation only and
are merged into this Agreement which contains the only agreement between the
parties regarding the subject matter described herein. Proprietor further
certifies that there are no contracts or agreements with any other party
regarding the subject matter herein.
15. Termination. This Agreement may be terminated as follows:
(a) By either party for breach of any material term hereof, provided that the
non-breaching party has given written notice of the breach and an
opportunity to the defaulting party to cure the breach; and further provided
that the breaching party has failed to cure the breach within 20 days of
actual receipt of notice of the breach or in such other time as may be
reasonable given the nature of the default;
(b) By Kachina it, in the thirty-day period following the end of the first six
months of actual gaming operations, Kachlna
<PAGE>
provides a minimum of 90 days advance written notice to Proprietor; in such
case, Kachina shall have a one-time option to unilaterally terminate this
agreement;
(c) By either party at the end of the initial term of this agreement upon
providing the other party written notice at least 60 days before the
expiration of the initial term.
16. Notice. Notice under this Agreement shall be deemed sufficient if given by
First Class Mail and facsimile to the address below,
if to Kachina Gaming: if to Proprietor:
Attn.: President XXXXX
AutoLend Group, Inc, XXXXX
600 Central SW, 3rd Floor XXXXX
Albuquerque, NM 87102 Attention: XXXXX
Ph. (505) 760-1000 Ph. XXXXX
Fx. (505) 768-1111 Fx. XXXXX
Gaming Machine Lease & Additional Service Agreement Page # 8 of 8
THE PARTIES HERETO SIGNIFY THEIR AGREEMENT as evidenced by their signatures
below.
KACHINA GAMING PROPRIETOR
A division of AutoLend Group, Inc. XXXXX
By: Fred A. Chavez(signed and typed) By: XXXXX (signed)
Vice President, Gaming Its Authorized Agent
Its Authorized Agent XXXXX
Name (Printed)
XXXXX
Title
Date: XXXXX
