Lease No. 025-3003833
============
First Security Leasing Company of Nevada
LEASE SCHEDULE TO
MASTER EQUIPMENT LEASE AGREEMENT
This Lease Schedule to Master Equipment Lease Agreement (the "Lease
Schedule") is entered into pursuant to the terms of the Master Equipment Lease
Agreement (the "Agreement") between the signatories hereof dated November 3,
1999 and constitutes a separate lease (the "Lease") thereunder.
All the terms and conditions of the Agreement are hereby incorporated
herein and made a part hereof as if such terms and conditions were set forth in
this Lease Schedule at length and all capitalized terms not otherwise defined
in this Lease Schedule shall have the meaning set out in the Agreement. By
their execution and delivery of this Lease Schedule Lessor and Lessee hereby
reaffirm on and as of the date hereof all the terms, conditions, agreements,
representations and warranties contained in the Agreement. A copy of the
signed Agreement attached to the Lease Schedule, which attachment shall adopt
the copied signatures on the Agreement as of the date of the Lease Schedule,
shall constitute an original lease. A copy of the Agreement and the Lease
Schedule shall alone constitute the chattel paper for purposes of perfecting a
security interest.
A. Description of Equipment
ID New Invoice
or or Purchase
Quantity Vendor Description Serial # Used Price
======== ====== =========== ======== ==== ========
TWO (2) SETS OF 23 FT 9 INCH
OVER ALL AREA HEIGHT ILLUMINATED
CHANNEL LETTERS
COPY "ATLANTIS" BUILT USING GRID
NEON WITH 6 INCH SPACE AND USING
2 Mikohn 60 MA TRANSFORMERS New $214,500.00
Lighting NEON WILL BE MOUNTED ON A MULT-
& Sign COLORED PAINTED METAL BACKGROUND
TO MATCH THE EXISTING BUILDING
LETTERS LOCATED ON THE LOWER
TOWER
THE LETTERS WILL HAVE GOLD
POLISHED RETURNS ANS SINGLE
WHITE NEON OUTLINE
(Tax in the amount of $14,500.00 paid directly to the
State of Nevada)
TOTAL INVOICE PURCHASE PRICE: $214,500.00
B. Term. 60 months.
C. Rental.
1. Frequency: Monthly
2. Advanced or Arrears: Advance
3. Rental Payment Dates: July 3, 2000, and on the same day of each Month
with the final payment on June 3, 2005.
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Lease No. 025-3003833
============
First Security Leasing Company of Nevada
LEASE SCHEDULE TO
MASTER EQUIPMENT LEASE AGREEMENT
4. Basic Rental in an amount equal to .0202716 of the total invoice
purchase price of all Items is payable on each Rental Payment Date.
5. Interim Rental in an amount equal to .000254 of the invoice purchase
price for each Item for each day from and including the date of
acceptance for such Item to but excluding the first Rental Payment Date
will be payable on the first Rental Payment Date.
D. Residual Value. 0 of the invoice purchase price of each item.
E. Location. The Equipment shall be located at:
Address: 3800 S. VIRGINIA STREET RENO, NV 89502
County: WASHOE
If required, the Equipment will be registered in NV.
F. Security Deposit. Concurrently with the execution hereof Lessee shall
deposit with Lessor the sum of N/A as a security deposit which Lessor may
use to satisfy any unpaid late charges, recording fees or other amounts
due and unpaid. Any unused portion of the deposit will be returned to
Lessee without interest upon expiration or earlier termination of the
Lease and upon payment of all sums then due and owing to Lessor, or Lessee
may, at its option, apply the unused balance of the security deposit
toward the last Rental payment.
G. Insurance. The minimum amount of insurance to be provided by Lessee as
required under the terms of the Agreement shall be as follows:
1. Liability:
$1,000,000.00 each individual
$1,000,000.00 each accident
$1,000,000.00 property damage liability
2. Physical Damage and Loss: $200,000.00
3. Additional riders, exclusions or special terms required by Lessor: N/A
H. Other Terms.
I. Execution of Financing Statements and Title Documents.
Lessee agrees to execute and deliver to Lessor such financing statements
and/or title documents as reasonably requested by Lessor to protect and
identify Lessor's interest in the Equipment. Lessee appoints Lessor, or
Lessor's agents or assigns, its true and lawful attorney-in-fact to prepare, to
execute and to sign the name of Lessee with the same force and effect as if
signed by Lessee, and to file the same at the locations reasonably determined
by Lessor.
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Lease No. 025-3003833
============
First Security Leasing Company of Nevada
LEASE SCHEDULE TO
MASTER EQUIPMENT LEASE AGREEMENT
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease Schedule to
be duly executed on behalf of each of them on November 3, 1999 and the
signatories warrant their authority to bind principles.
CO-LESSEES: MONARCH CASINO & RESORT, INC.
and GOLDEN ROAD MOTOR INN, INC. dba
ATLANTIS CASINO & RESORT
LESSEE: MONARCH CASINO & RESORT, INC. LESSOR: FIRST SECURITY
a(n) Nevada Corporation LEASING COMPANY OF NEVADA
BY: /S/ John Farahi BY: /S/ Jerry J. Velarde
=============== ===================
John Farahi, CEO Jerry J. Velarde, AVP
TITLE: CEO TITLE: AVP Authorized
================ Representative
================
Address: 3800 S. VIGINIA STREET ADDRESS: c/o First Security
Reno, NV 89502 Leasing Company
381 East Broadway,
Federal ID or Social 2nd Floor
Security Number: 88-0300760 Salt Lake City, UT 84111
GOLDEN ROAD MOTOR INN, INC.
dba ATLANTIS CASINO RESORT
a(n) Nevada Corporation
BY: /S/ John Farahi
===============
John Farahi, CEO
TITLE: CEO
================
Address: 3800 S. VIRGINIA STREET
RENO, NV 89502
Federal ID or Social Security Number: 88-0117859
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
This MASTER EQUIPMENT LEASE AGREEMENT is between the First Security
Leasing Company of Nevada ("Lessor") and the lessee or lessees specified below
("Lessee").
Section 1. Declaration of Intent to Lease; Delivery and Acceptance of
Equipment.
A. Subject to the terms hereof, Lessor agrees to make payment for and to
lease to Lessee the personal property described in Schedules, as defined below,
(hereinafter referred to collectively as "Equipment" and individually as "Item"
or "Item of Equipment"), and Lessee agrees to lease each such Item of Equipment
from Lessor for the Rental specified in the Lease Schedules to Master Equipment
Lease Agreement entered into pursuant to this Agreement and making specific
reference hereto (the "Schedules"), subject to the terms and conditions set
forth herein and in the Schedules.
B. There may be one or more Schedules under this Agreement executed either
simultaneously with or subsequent to the execution and delivery of this
Agreement. Each Schedule making specific reference to the Agreement and
incorporating the terms hereof shall constitute a separate lease which will be
identified by a Lease Number identified in such Schedule. The term "Agreement"
used herein shall refer to this Master Equipment Lease Agreement and the
Schedules. The lease created by a particular Schedule and a copy of the Master
Equipment Lease Agreement shall be referred to as "a Lease". The terms of this
Master Equipment Lease Agreement may be changed, modified or supplemented in
Section 1 of any Schedule.
Section 2. Term; Rental and Late Charges.
A. The term of each Lease with respect to any Item of Equipment (the
"Term") shall commence on the date of acceptance indicated in the Schedules
hereof relating thereto (the "Acceptance Date") and shall end, unless earlier
terminated in accordance with the provisions of this Agreement, at the
expiration of the Term specified in the Schedule.
B. Lessee shall pay to Lessor Basic Rental and Interim Rental for each
Item of Equipment in the amounts and on the dates specified in the Schedules
(each a "Rental Payment Date").
C. In the event any Rental or other amount payable hereunder shall not be
paid within ten (10) days when due, Lessee shall pay to Lessor, as supplemental
rental, an amount equal to five percent (5%) of such overdue Rental, plus
interest on such overdue payment until paid, at the rate of eighteen percent
(18%) per annum.
D. All payments to Lessor provided for in this Lease shall be paid to
Lessor at the address indicated herein or at such other place as Lessor shall
specify in writing.
E. All Leases created hereunder are net leases and Lessee shall not be
entitled to any abatement of Rental, Residual Value or other charges payable
hereunder by Lessee or withholding thereof from Lessor or any reduction
thereof, including, but not limited to, abatements or reductions due to any
present or future claims of Lessee against Lessor or any assigned under this
Agreement or otherwise, or against the manufacturer or vendor of the Equipment,
nor, except as otherwise expressly provided herein, shall this Agreement
terminate, or the obligations of Lessee be affected, by reason of any defect in
or damage to or loss or destruction of all or any of the Equipment from
whatever cause, the interference with use by any private person, corporation or
governmental authority, the invalidity,
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
unenforceability or lack of due authorization of this Agreement or lack of
right, power or authority of Lessor to enter into this Agreement, or for any
other cause whether similar or dissimilar to the foregoing.
Section 3. Early Termination; Renewal; Purchase.
A. Provided no Event of Default shall have occurred and be continuing
hereunder, Lessee shall have the right during the Term, upon not less than
sixty (60) days' prior written notice to Lessor, to terminate a Lease with
respect to all, but not less than all, Items thereunder as of the next
succeeding Rental Payment Date following such notice, subject to Lessor's
receipt of the payments specified in the following sentence. On or before the
termination of a Lease, Lessee shall pay to Owner: (1) all Rental due and to
become due up to an including the next succeeding Rental Payment Date following
such notice; and (2) the Termination Value of the Equipment being terminated as
of such next succeeding Rental Payment Date. Upon payment of all such amounts
the obligation of Lessee to pay Rental on each succeeding Rental Payment Date
shall then terminate. The "Termination Value" of an Item shall mean, as of any
Rental Payment Date, the present value of the sum of (i) all remaining
installments of Rental (excluding the installment due on such Rental Payment
Date) and (ii) the Residual Value indicated in the Schedule relating thereto,
computed by discounting such amounts at such rate and applying such penalties
as shall then be consistent with Lessor's normal business practices.
B. Provided no Event of Default shall have occurred and be continuing
hereunder, Lessee shall have the right, upon not less than sixty (60) days'
prior written notice to Lessor, to renew a Lease upon the expiration of the
term thereof with respect to all, but not less than all, Items thereunder for
such term as Lessor and Lessee agree and with Rental payments which will fully
amortize the Residual Value at then current market rates.
C. Upon the expiration of the Term of a Lease, unless renewed or
terminated earlier in accordance herewith, Lessee shall pay to Lessor on the
final day of the Term an amount in cash equal to the Residual Value of all, but
not less than all, Items thereunder.
D. If Lessee shall determine upon the expiration of the Term of a Lease or
the termination thereof pursuant to this Section 3, to sell the Equipment
thereunder to a third party rather than to retain such Equipment, Lessee shall
notify Lessor in writing of such determination at lease sixty (60) days prior
to such expiration or termination. Upon receipt of such notice, Lessor shall
act as the exclusive agent of Lessee to sell such Equipment. Lessor shall use
its best efforts to arrange a sale for cash of the Equipment at then current
market values. Lessee agrees to reimburse Lessor for all expenses incurred by
Lessor in connection with such sale including the costs of repair or
preparation of the Equipment and to pay a reasonable fee for such services.
Lessor shall be entitled to retain from the proceeds of any such sale or lease
any amounts then still due and owing to Lessor. Any excess shall be paid to
Lessee. Nothing in this paragraph shall be construed to relieve Lessee of its
obligation to pay the applicable Termination Value and Residual Value on the
date such payments are due under Sections 3(A) and 3(C) hereof.
E. All sales pursuant to this Section 3 shall be made without any
representation, recourse or warranty on the part of Lessor except that Lessor
shall warrant that the Equipment is free and clear of all liens, charges and
encumbrances arising as a result of claims against Lessor not related to its
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
ownership of the Equipment. Lessor shall deliver to Lessee or other buyer any
and all documents reasonably requested to transfer title to such Equipment on
an as-is where-is basis.
Section 4. Conditions Precedent.
The obligation of Lessor to lease an Item of Equipment and to make payment
to the vendor therefor is subject to Lessee's supplying the following, if
requested by Lessor, at Lessee's expense, in form and substance satisfactory to
Lessor.
A. Articles of Incorporation and By-laws of Lessee, and resolutions of
the Board of Directors, each certified by the Secretary or an Assistant
Secretary duly authorizing each Lease of Equipment hereunder and the execution,
delivery and performance of this Agreement and each Schedule if Lessee is a
corporation;
B. Partnership Agreement, trust indenture, assumed name filings or such
other documents as Lessor may demand if lessee is not a corporation;
C. Evidence satisfactory to Lessor as to due compliance with the insurance
provisions of Section 11 hereof and Section G of the Schedules;
D. A favorable written opinion of counsel for Lessee satisfactory to
Lessor as to each of the matters set forth in Section 5(B)(i)-(vi) hereof and
as to such other matters as Lessor may reasonably request;
E. A completed and signed Schedule including a description of such Item;
and
F. Vendor's invoice of the Item.
Section 5. Representations and Warranties.
A. Lessor's Representations and Warranties. Lessor warrants that during
the Term of any Lease, if no Event of Default has occurred, Lessee's use of the
Equipment shall not be interrupted by Lessor or anyone claiming solely through
or under Lessor.
The warranties set forth in the preceding paragraph are in lieu of all
other warranties of Lessor, whether written, oral or implied, and Lessor shall
not, by virtue of having executed this Agreement or any other document pursuant
to this Agreement, or for any other reason, be deemed to have made any other
warranties. LESSOR LEASES THE EQUIPMENT AS IS WITHOUT WARRANTY OR
REPRESENTATION, EITHER EXPRESSED OR IMPLIED, AS TO ANY MATTER WHATSOEVER,
INCLUDING WITHOUT LIMITATION (A) THE DESIGN, PERFORMANCE, SPECIFICATIONS OR
CONDITION OF ANY ITEM OR ITEMS OF EQUIPMENT, (B) THE MERCHANTABILITY THEREOF,
(C) THE FITNESS FOR ANY PARTICULAR PURPOSE THEREOF, (D) THE LESSOR'S TITLE
THERETO, (E) INTERFERENCE BY ANY PARTY OTHER THAN LESSOR WITH LESSEE'S RIGHT TO
THE QUIET ENJOYMENT THEREOF, OR (F) THE QUALITY OF THE MATERIAL OR WORKMANSHIP
OF THE EQUIPMENT OR CONFORMITY THEREOF TO THE PROVISIONS AND SPECIFICATIONS OF
ANY PURCHASE ORDER RELATING THERETO, IT BEING AGREED THAT ALL SUCH RISKS AS
BETWEEN LESSOR AND LESSEE ARE TO BE BORNE BY LESSEE. LESSEE FURTHER
UNDERSTANDS AND AGREES THAT NEITHER THE EQUIPMENT SUPPLIER NOR ANY SALESPERSON
OR OTHER AGENT OR EMPLOYER OF SUCH SUPPLIER IS AN AGENT FOR OR HAS ANY
AUTHORITY TO SPEAK FOR OR TO BIND LESSOR IN ANY WAY, LESSOR IS NOT AN AGENT OR
REPRESENTATIVE OF SUCH SUPPLIER. Lessor hereby authorizes Lessee, at Lessee's
expense, to assert for Lessor's account during the Term of a Lease, all of
Lessor's rights under any manufacturer's vendor's or dealer's warranty on the
Equipment to the extent permitted by law and agreement, and Lessor agrees to
cooperate with Lessee n asserting such rights; provided, however, Lessee shall
indemnify and hold harmless Lessor
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
from and against any and all claims, and all costs, expenses, damages, losses
and liabilities incurred or suffered by Lessor in connection therewith, as a
result of, or incident to, any action by Lessee pursuant to the above
authorization. Lessor shall not be responsible for special or consequential
damages relating to its obligations or performance under their Agreement.
B. Lessee's Representations and Warranties. Lessee represents and
warrants that:
(i) Lessee, if a corporation, is duly organized and existing in good
standing under the laws of the state of its incorporation, and is duly
qualified to do business in those jurisdictions (including those where the
Equipment will be located) where such qualification is necessary to carry on
its present business operations;
(ii) Lessee, if a partnership, trust or other entity, is duly
organized, registered and validly existing under the laws of the jurisdiction
of its organization or residence and is duly qualified to do business in those
jurisdictions (including those where the Equipment will be located) where such
qualification is necessary to carry on its present business operations;
(iii) Lessee has full power, authority and legal right to execute,
deliver and perform the terms of this Agreement. This Agreement has been duly
authorized by all necessary corporate action on the part of Lessee and the
execution, delivery and performance thereof do not require any stockholder
approval, do not require the approval of or the giving of notice to any
federal, state, local or foreign government authority, do not contravene any
law binding on Lessee or Lessee's certificate or articles of incorporation or
by-laws and do not contravene or constitute a default under any indenture,
credit agreement or other agreement to which Lessee is a party or by which it
is bound;
(iv) This Agreement constitutes a legal, valid and binding obligation
of Lessee, enforceable in accordance with its terms;
(v) There are no pending or threatened actions or proceedings before
any court, administrative agency or other tribunal or body or judgments which
may materially adversely affect Lessee's financial condition or operations;
(vi) No approval, consent or withholding of objection is required
from any governmental authority with respect to the entering into or
performance by Lessee of this Agreement;
(VII) The balance sheet of Lessee for its most recent fiscal year and
the related earnings statement of Lessee for such fiscal year have been
furnished to Lessor and fairly present Lessee's financial condition as of such
date and the results of its operations for such year in accordance with
generally accepted accounting principles consistently applied, and since such
date there has been no material adverse change in such conditions or
operations; and
(VIII) Lessee shall not consolidate with or merge into any other
business entity or convey, transfer or lease substantially all of its assets as
an entirety to any third party without the prior written consent of Lessor.
C. "Year 2000 Compliant" shall mean, with regard to any entity, that all
software, hardware, firmware, equipment, goods or systems used by or material
to the business operations or financial condition of such entity will properly
perform date-sensitive functions before, during and after January 1,
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
2000. Such date-sensitive functions shall include, without limitations, (a)
interpretation of years greater than 1999, (b) process date data from, into,
and between dates before January 1, 2000, and dates on or after January 1,
2000, (c) recognizing numbers such as "99" as an actual date rather than
indefinite or an unknown information, (d) recognizing that the year 2000 is a
leap year, and (e) transferring data between systems that used different
methods to make the system Year 2000 Compliant. Lessee represents and warrants
to Lessor that Lessee has developed a detailed plan to ensure that Lessee, its
affiliates, and all customers, suppliers and vendors that are material to the
Lessee's business, become Year 2000 Compliant on or before June 30, 1999. The
plan (a) effectively prioritizes mission-critical systems, (b) has the
involvement of executive management, (c) includes assessment of Year 2000
Compliance of the customer, supplier, and vendors, (d) includes contingency
planning to mitigate risk from Year 2000 business interruptions affecting key
vendors, suppliers, or customers, and (e) has been allocated with adequate
resources within Lessee's abilities.
Section 6. Mortgages, Liens, Etc.
Lessee will not directly or indirectly create, incur, assume or permit the
existence of any mortgage, security interest, pledge, lien, charge, encumbrance
or claim on or with respect to the Equipment, title thereto or any interest
therein except (a) the respective rights of Lessor and Lessee as herein
provided, (b) liens or encumbrances which result from claims against Lessor
except to the extent that such liens and encumbrances arise from failure of
Lessee to perform any of Lessee's obligations hereunder, and (c) liens for
taxes either not yet due or being contested in good faith and by appropriate
proceedings. Lessee will promptly, at its own expense, take such action as may
be necessary duly to discharge any such mortgage, security interest, pledge,
lien, charge encumbrance or claim not specifically excepted above.
Section 7. Taxes.
Lessee agrees to pay promptly when due and to indemnify and hold Lessor
harmless from all sales, use, personal property, leasing, leasing use, stamp or
other taxes, levies, imposts, duties, charges, fees or withholding of any
nature (together with any penalties, fines or interest thereon) imposed against
Lessor, Lessee or the Equipment by any federal, state, local or foreign
government or taxing authority upon or with respect to the Equipment or upon
the purchase, ownership, delivery, leasing, possession, use operation, return
or other disposition thereof, or upon the rentals, receipts or earnings arising
therefrom, or upon or with respect to any Lease (excluding, however, federal,
state and local taxes on or measured solely by the net income of Lessor)
unless, and to the extent only, that any such tax, levy, impost, duty, charge
or withholding is being contested by Lessee in good faith and by appropriate
proceedings. In case any report or return is required to be made with respect
to any obligation of Lessee under this Section Lessee will notify Lessor of
such requirement and make such report or return in such manner as shall be
satisfactory to Lessor. Lessor agrees to cooperate fully with lessee in the
preparation of any such reports or returns. Lessee agrees to remit all
applicable sale or use taxes to Lessor promptly upon receipt of an invoice
therefor.
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
Section 8. Title; Use, Maintenance and Operation, Identification Marking.
A. Lessor shall retain full legal title to the Equipment notwithstanding
delivery to and possession and use thereof by Lessee. Upon delivery of the
Equipment Lessee shall cause said Equipment to be duly registered, and at all
times thereafter to remain duly registered, in the name of Lessor, or at
Lessor's request shall furnish to Lessor such information as may be required to
enable Lessor to make application for such registration and shall promptly
furnish to Lessor such information as may be required to enable Lessor to file
timely any reports required to be filed by it as Lessor under the Lease or as
the owner of the Equipment with any governmental authority.
B. Lessee agrees that the Equipment will be used solely in the conduct of
its business. Lessee further agrees to comply in all material respects with
all applicable governmental laws, regulations, requirements and rules with
respect to the use, maintenance and operation of each Item of Equipment.
Lessee agrees that each Item of Equipment (except Items which prior to the
execution of this Lease Lessee shall have advised Lessor in writing are
normally used or to be used in more than one location) will be kept at the
address shown in the Schedules with respect to such Item unless Lessor shall
first otherwise consent in writing. Lessee will immediately give written
notice to Lessor of any change in its principal place of business.
C. Lessee, at its own cost and expense, will repair and maintain the
Equipment so as to keep it in a good condition as when delivered to Lessee
hereunder, ordinary wear and tear excepted. Lessee may from time to time add
further parts or accessories to any Item of Equipment provided that such
addition does not impair the value, utility or warranties of such Item of
Equipment and is readily removable without causing material damage to such
Item.
D. Lessee agrees at its own cost and expense to place such markings,
plates or other identification on the Equipment showing Lessor's title thereto
as Lessor may from time to time request, provided such identification markings
are placed so as not to interfere with the usefulness of such Equipment.
Except as above provided, Lessee will not allow the name of any person,
association or corporation to be placed on the Equipment as a designation that
might be interpreted as a claim of ownership.
Section 9. Inspection.
Upon the request of Lessor, Lessee shall advise Lessor as to the location
of each Item of Equipment and shall, at any reasonable time, make the Equipment
available to Lessor or Lessor's agent for inspection at the place where it is
ordinarily located and shall make Lessee's records pertaining to the Equipment
available for Lessor's inspection.
Section 10. Loss or Destruction.
In the event any Item of Equipment shall be lost, stolen, destroyed,
damaged beyond repair or permanently rendered unfit for use for any reason
whatsoever ("Event of Loss"), Lessee shall promptly, but in any event within
ten (10) days of the Event of Loss, give written notification to Lessor of said
loss and the facts pertaining thereto. In addition, within ten (10) days of
the Event of Loss Lessee shall elect either: (a) to replace such Item of
Equipment at Lessee's own cost and expense of; or (b) to pay to Lessor the
Termination Value of the Item and shall notify Lessor in writing of such
election.
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
Should Lessee elect to replace such Item, any replacement Item shall be
free and clear of all liens, encumbrances and rights of others and shall be of
like kind and have substantially equal fair market value as the replaced Item,
as if such replaced Item were in the condition and repair required to be
maintained by the terms hereof. All such replacement Items shall become the
property of Lessor and shall immediately become subject to this Agreement, and
shall be deemed part of the Equipment for all purposes hereof, to the same
extent as the property originally comprising the Equipment. Such replaced Item
of Equipment shall no longer be deemed part of the Equipment lease hereunder,
and Lessor will transfer to Lessee, without recourse or warranty all of
Lessor's right, title and interest therein. In the event Lessee elects to
replace such Item of Equipment, Lessee's obligation to pay Rental as set forth
in this lease Agreement shall remain unchanged. Lessee further agrees to
execute such documents in connection with such replacement as deemed necessary
by Lessor to insure Lessor's full title thereto.
Should Lessee elect not to replace such Item of Equipment, Lessee shall
pay to Lessor, on the next Rental Payment Date for such Item following such
Event of Loss, the Termination Value of such lost or destroyed Item. The
obligation of Lessee to pay Rental with respect to such Item (including the
Rental due on such Rental Payment Date) shall continue undiminished until the
payment of such Termination Value. After the payment of such Termination
Value, Lessee's obligation to pay Rental for such Item shall cease, but
Lessee's obligation to pay Rental for all other Items of Equipment shall remain
unchanged. After the payment of such Termination Value, Lessor will transfer
to Lessee, without recourse or warranty, all of Lessor's right, title and
interest in and to such Item of Equipment suffering the Event of Loss.
Section 11. Insurance.
At its own expense, Lessee shall maintain comprehensive general liability,
products liability and property damage insurance acceptable to Lessor with
respect to each Item in an amount not less than the amount specified in the
Schedules relating thereto and, in any event, in an amount sufficient to
provide full coverage against all loss and liability. Each such insurance
policy shall name Lessor as an insured and as loss payee and shall provide that
it may be altered or canceled by the insurer only after thirty (30) days prior
written notice to Lessor. Lessee agrees to cause certificates or other
evidence satisfactory to Lessor showing the existence of such insurance, the
terms and conditions of each policy and payment of the premium therefor to be
delivered to Lessor upon demand thirty (30) days prior to expiration or
cancellation showing renewal or replacement of such policy. In the event
Lessee shall fail to obtain and/or maintain insurance in accordance with the
provisions of this paragraph, Lessor shall have the right to obtain such
insurance as Lessor deems necessary, and Lessee shall reimburse Lessor for the
payment by Lessor of all premiums therefor together with interest computed from
the date of Lessor's payment at the rate of eighteen percent (18%) per annum.
If (a) any insurance proceeds are received with respect to a loss with respect
to Equipment which does not constitute an Event of Loss under Section 10, or
(b) if Lessee elects to replace an Item or Items suffering an Event of Loss
under the provisions of Section 10 hereof, proceeds will be applied in payment
for repairs and replacement required pursuant to Section 8 and 9 hereof, or to
reimburse Lessee have made such payments.
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
Section 12. Indemnification and Expenses.
Lessee shall indemnify, protect and keep harmless Lessor or any assignee
or transferee of Lessor and their respective agents and servants from and
against all claims, causes of action, damages, liability (including strict
liability in tort), costs, fees or expenses (including attorney's fees)
incurred in any manner by or for the account of any of them relating to the
Equipment or any part thereof including without limitation the construction,
purchase, delivery, installation, ownership, leasing or return of the Equipment
or as a result of the use, maintenance, repair, replacement, operation or
condition thereof, (whether defects are latent or discoverable by Lessor or by
Lessee). This Section shall be effective from the date the first Item of
Equipment is ordered and shall remain in effect notwithstanding the expiration
or other termination of a Lease with respect to any one or more Items of
Equipment. Lessee agrees to give Lessor prompt notice of any claim or
liability hereby indemnified against. Lessor agrees to cooperate with Lessee
in any defense or other action which Lessee is by this Section obligated to
undertake.
Section 13. Assignments and Subsidies.
Lessor may at any time, without notice, grant a security interest in,
transfer or assign any or all Leases, Items, or rights and remedies as Lessor
to any party, with such party assuming all, part or none of Lessor's
obligations. Lessee shall not assert against such party any defense,
counterclaim, or offset Lessee may have against Lessor. Lessee acknowledges
that any such grant, transfer or assignment would not materially change
Lessee's duties, risks or interests under the Agreement.
LESSEE SHALL NOT, WITHOUT LESSOR'S PRIOR WRITTEN CONSENT, SUBLEASE OR
RELINQUISH POSSESSION OF ANY ITEM OR ASSIGN ANY OF ITS RIGHTS OR DELEGATE ANY
OF ITS OBLIGATIONS HEREUNDER. Lessee grants Lessor a security interest in any
existing or future sublease of an Item and the proceeds thereof, whether or not
such sublease is prohibited.
Section 14. Events of Default; Remedies.
A. The following shall constitute Events of Default hereunder:
(i) Lessee shall fail to make any Interim or Basic Rental payment or
the Residual Value payment when due and such failure shall continue unremedied
for ten (10) days:
(ii) Lessee shall fail to make any payment other than Rental required
hereunder or shall fail to perform or observe any covenant, condition or
agreement to be performed or observed by it under this Agreement, and such
failure shall continue unremedied for ten (10) days after notice form Lessor
requiring performance;
(iii) Any representation or warranty made by Lessee herein, in any
Schedule or any supplement or addition hereto, or in any document or
certificate furnished Lessor in connection herewith shall prove to be incorrect
at any time in any material respect; or
(iv) Lessee shall become insolvent or bankrupt or make an assignment
for the benefit of creditors or consent to the appointment of a trustee or
receiver, or a trustee or a receiver shall be appointed for Lessee or for a
substantial part of its property without its consent and shall not be dismissed
within a period of sixty (60) days, or bankruptcy, reorganization
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MASTER EQUIPMENT LEASE AGREEMENT
or insolvency proceedings shall be instituted by or against Lessee and, if
instituted against Lessee, shall not be dismissed for a period of sixty (60)
days.
(v) Any event of default as described in the documentation executed
in connection with any other credit or lease facility extended by Lessor, or
any affiliated company of Lessor, to Lessee.
B. Upon the occurrence of an Event of Default Lessor may at its option
exercise one or more of the following remedies:
(i) Declare all unpaid Rentals under any Lease or all Leases to be
immediately due and payable;
(ii) Proceed by appropriate court action to enforce performance by
Lessee of the applicable covenants, of the Agreement and/or to recover damages
for the breach thereof; or
(iii) By notice in writing terminate any Lease or all Leases whereupon
all rights of Lessee to the use of the Equipment shall absolutely cease and
terminate, but
Lessee shall remain liable as hereinafter provided. Thereafter, Lessee,
if requested by Lessor, shall, at its own cost promptly deliver possession of
the Equipment to Lessor in such manner and to such place as Lessor shall direct
or Lessor may at any hour and without liability, except for malicious acts by
its agents, and without notice to Lessee enter upon the premises of Lessee or
other premises where any of the Equipment may be located and take possession of
or render unusable all or any of such Equipment and attachments thereon whether
or not the property of Lessor and thenceforth hold, sell or re-lease such
Equipment at its option. Lessor shall thereupon have a right to recover from
Lessee an amount equal to any unpaid Rental due and payable up to and including
the Rental Payment Date following the date on which Lessor has given the
termination notice referred to above, any and all other amounts due and payable
hereunder and in addition thereto (a) as damages for loss of the bargain and
not as penalty an amount equal to the Termination Value as of such Rental
Payment Date, and (b) all expenses, including by not limited to reasonable
attorney's fees, which Lessor shall have sustained by reason of the breach of
any covenant of this Agreement, expenses for obtaining and storing the
Equipment and expenses in connection with locating another lessee or buyer.
C. The remedies in this Agreement in favor of Lessor shall not be deemed
exclusive, but shall be cumulative and shall be in addition to all other
remedies in its favor existing at law or in equity. Lessee hereby waives any
mandatory requirements of law, now or hereafter in effect, which might limit or
modify any of the remedies herein provided, to the extent that such waiver is
permitted by law. No express or implied waiver by Lessor of any Event of
Default hereunder shall in any way be, or be construed to be, a waiver of any
future or subsequent Event of Default. The failure or delay of Lessor in
exercising any rights granted it hereunder upon any occurrence of any of the
contingencies is set forth in Section 14 (A) shall not constitute a waiver of
any such right upon the continuation or recurrence of any such contingencies or
similar contingencies and any single or partial exercise of any particular
right by Lessor shall not exhaust the same or constitute a waiver of any other
right provided herein.
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
Section 15. Lessor's Rights to Perform for Lessee.
If Lessee fails to perform or comply with any of its agreements contained
herein, Lessor may, but shall not be required to, make any payment or perform
or comply with any covenant or agreement contained herein, and all reasonable
expenses of Lessor incurred in connection therewith shall be payable by Lessee
upon demand together with interest at the rate of eighteen percent (18%) per
annum from the date of payment to the date of reimbursement.
Section 16. Further Assurance; Financial Information.
Lessee will promptly and duly execute and deliver to Lessor such further
documents or instruments of further assurance and take such further action as
Lessor may from time to time, reasonably request in order to carry out the
intent and purpose of this Agreement and to establish and protect the rights
and remedies created or intended to be created in favor of Lessor hereunder,
including, without limitation, if requested by Lessor, at the expense of
Lessee:
A. The execution and delivery of financing statements with respect hereto,
in accordance with the laws of such jurisdictions as Lessor may from time to
time deem advisable.
B. An audit report containing a balance sheet, income statement and
statement of sources and uses of funds prepared by independent certified public
accountants, or other accountant acceptable to Lessor within one hundred twenty
(120) days after the close of each fiscal year of Lessee; and
C. A report containing balance sheets as of the end of each quarterly
period of Lessee's fiscal year, income statement and statement of sources and
uses of funds certified as accurate by an officer of Lessee within forty-five
(45) days after the close of each such quarterly period.
Section 17. Notices.
All notices required by the terms hereof shall be in writing, and shall
become effective when deposited in the United States mail, with proper postage
for certified mail prepaid, addressed to the address shown herein or to such
other address as such party shall from time to time designate for itself in
writing to the other party. Notice to Lessor is sufficient if mailed to: First
Security Leasing Company, P.O. Box 30006, Salt Lake City, Utah, 84130. Notice
to Lessee is sufficient if mailed to the address set forth on the signature
page of this Agreement.
Section 18. Multiple Lessees.
If there is more than one Lessee named in this Agreement, the liability of
each shall be joint and several, and each Lessee has the authority to enter
into agreements with Lessor modifying or extending the terms of the Agreement
on behalf of each other Lessee. If used herein or in any related document, the
term "Co-Lessee" or Co-Lessees" shall be synonymous with "Lessee" as defined
herein.
Section 19. Year 2000.
The Lessee shall take all actions that may be necessary or desirable, or
that Lessor may reasonably request, in order to ensure that the Lessee, its
affiliates and all customers, suppliers and vendors that are material to the
Lessee's business, become Year 2000 Compliant on or before June 30, 1999. Such
actions shall include, without limitation, (a) performing a
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MASTER EQUIPMENT LEASE AGREEMENT
comprehensive inventory, review and assessment of all of the Lessee's systems
and adopting a detailed plan with, itemized budget and timetable, for the
remediation, monitoring and testing such systems, and (b) making a detailed
inquiry of all material customers, suppliers and vendors to ascertain whether
such entities are aware of the need to be Year 2000 Compliant and are taking
all appropriate steps to become Year 2000 Compliant on a timely basis. Lessee
shall, promptly, upon request, provide to Lessor such certifications or other
evidence of Lessee's compliance within the terms of the section as Lessor may,
from time to time, reasonably require.
Section 20. Execution of Financing Statements and Title Documents.
Lessee agrees to execute and deliver to Lessor such financing statements
and/or title documents as reasonably requested by Lessor to protect and
identify Lessor's interest in the Equipment. Lessee hereby grants a security
interest to Lessor in the Equipment. Lessee appoints Lessor, or Lessor's
agents or assigns, its true and lawful attorney-in-fact to prepare, to execute
and to sign any instrument or financing statement concerning the Equipment, to
sign the name of Lessee with the same force and effect as if signed by Lessee,
and to file the same at the locations reasonably determined by Lessor.
Section 21. Effect of Invalid Provision.
Any provision of the Agreement which may be determined by competent
authority to be prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction. To the
extent permitted by applicable law, Lessee hereby waives any provision of law
which renders any provision hereof prohibited or unenforceable in any respect.
Section 22. Miscellaneous.
This Agreement and other written documents executed by the parties hereto
contain the entire agreement between the parties and there are no verbal
representations, warranties, or agreements of any kind whatsoever.
No term or provision of this Agreement may be changed, waived, discharged,
or terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought. No third-party manufacturer, supplier, salesperson, or broker, or any
agent thereof, is Lessor's agent or is authorized to waive or modify any
provision of the Agreement.
This Agreement shall in all respects be governed by, and construed in
accordance with, the laws of the State of Nevada. Any judicial proceeding
brought against Lessee with respect to this Agreement may be brought in any
court of competent jurisdiction in the State of Nevada. By its execution of
the Agreement and the Schedules, Lessee unconditionally accepts the
jurisdiction of the courts of the State of Nevada and agrees to be bound by any
judgement rendered thereby with respect to this Agreement. If Lessee is not a
resident of the State of Utah, service process upon Lessee by mail shall
constitute sufficient notice of any such proceeding.
The word "including" as used in the Agreement shall mean "including, but
not limited to". Nothing herein shall affect the right to serve process in
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First Security Leasing Company of Nevada
MASTER EQUIPMENT LEASE AGREEMENT
any other manner permitted by law or limit the right of Lessor to bring
proceedings against Lessee in the courts of any jurisdiction.
This Agreement shall inure to the benefit of and be binding upon the
heirs, successors, assigns and personal representatives of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed on behalf of them as of this November 3, 1999 and signatories
warrant their authority to bind their principals.
CO-LESSEES: MONARCH CASINO &. and GOLDEN ROAD MOTOR INN, INC. dba
GOLDEN ROAD MOTOR INN, INC. dba ATLANTIS CASINO RESORT
ATLANTIS CASINO & RESORT a(n) Nevada Corporation
BY: /S/ John Farahi
================
John Farahi, CEO
TITLE: CEO
================
Address: 3800 S. VIRGINIA STREET
RENO, NV 89502
Federal ID or Social Security
Number: 88-0117859
LESSEE: MONARCH CASINO & RESORT, INC. LESSOR: First Security Leasing
a(n) Nevada Corporation Company of Nevada
BY: /S/ John Farahi BY: /S/ Jerry J. Velarde
=============== ===================
John Farahi, CEO Jerry J. Velarde, AVP
TITLE: CEO TITLE: AVP Authorized
================ Representative
================
Address: 3800 S. VIGINIA STREET ADDRESS: c/o First Security
Reno, NV 89502 Leasing Company
381 East Broadway,
2nd Floor
Salt Lake City, UT 84111
Federal ID or Social Security Number: 88-0300760
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