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EXHIBIT
10.3
FIFTH AMENDMENT TO LEASE AND
DEVELOPMENT AGREEMENT
This FIFTH AMENDMENT TO LEASE
AND DEVELOPMENT AGREEMENT (the “Amendment”) is made and
entered into this 30 th day
of March, 2007 by and between the ST. LOUIS COUNTY PORT AUTHORITY,
a public body corporate and politic of the State of Missouri (the
“Landlord”) and PINNACLE ENTERTAINMENT, INC., a
Delaware corporation (the “Tenant”).
RECITALS
A. Landlord and Tenant
entered into a Lease and Development Agreement dated as of
August 12, 2004 as amended by letter agreement between the
Landlord and the Tenant of even date, as further amended by letter
agreement between the Landlord and Tenant dated October 4,
2005, and as further amended by Second Amendment to Lease and
Development Agreement dated October 28, 2005 between the
Landlord and Tenant, and as further amended by the Third Amendment
to Lease and Development Agreement dated August 11, 2006, and
as further amended by Fourth Amendment to Lease and Development
Agreement dated January 18, 2007 (collectively, the
“Lease and Development Agreement”) pursuant to which
the Tenant agreed, subject to the terms and conditions in the Lease
and Development Agreement, to construct and develop the gaming and
mixed use project in unincorporated Lemay, Missouri, including an
access road (the “Access Road” and with the gaming and
mixed use project, the “Project”).
B. Pursuant to
Section 4(p) of the Lease and Development Agreement the
Landlord agreed to cooperate with Tenant to obtain the defense
mapping facility (the “NIMA Property”) a portion of
which is required for the Access Road (said portion being
hereinafter defined as the “Access Road Property”) from
the United States of America.
C. The Landlord and the
United States of America acting through the Director of the Air
Force Real Property Agency and the Administrator of the General
Services Administration pursuant to authority delegated by the
Secretary of the Air Force entered into an Agreement for Lease and
Transfer dated February 27, 2006 governing the transfer of the
NIMA Property.
D. As a condition precedent
to the transfer of the NIMA Property, the Landlord is required to
post a letter of credit as security for the obligation to remediate
environmental contamination on the NIMA Property in the amount of
Six Million Dollars ($6,000,000.00) (the “Air Force Letter of
Credit”).
E. Landlord has requested and
Tenant has agreed to provide a standby letter of credit to Landlord
in connection with such environmental remediation obligations
subject to the terms and conditions hereafter set forth.
F. Capitalized terms used
herein and not otherwise defined shall have the meanings ascribed
to them in the Lease and Development Agreement.
NOW, THEREFORE, in
consideration of the mutual covenants and agreements of the parties
contained herein, Landlord and Tenant agree to amend the Lease and
Development Agreement as follows:
1. Section 4(v) is
renumbered 4(w) and the following section is inserted as
Section 4(v):
“Section 4(v).
Tenant’s Letter of Credit . Tenant shall cause to be
issued to the Landlord a standby letter of credit in the face
amount of Three Million Dollars ($3,000,000.00) (the
“Tenant’s Letter of Credit”) substantially in the
form attached as Exhibit A hereto. Upon any draw on the
Tenant’s Letter of Credit attributable to Landlord’s
failure to perform Environmental Remediation on the portion of the
NIMA Site not consisting of the Access Road Property, the Landlord
shall within five (5) days following such draw elect by
written notice to Tenant to either (a) pay the amount of such
draw to Tenant or (b) provide to Tenant a credit against
Annual Rent provided for under the Lease and Development Agreement.
If Landlord elects to pay to Tenant the amount of such draw (it
being acknowledged that any failure by Landlord to make the
foregoing written election shall be deemed an election that Tenant
shall receive credit against Annual Rent and may deduct therefrom
the amount of such draw together with interest thereon from the
date of draw until satisfaction thereof) then the Landlord shall
pay to Tenant such amount within thirty (30) days of the date
of such draw, which payment shall include interest otherwise
payable by Tenant under Tenant’s Letter of Credit with
respect to the amount so drawn from the date of such draw through
the date of full payment of such amount. If Tenant does not receive
Landlord’s payment for draws under the Tenant’s Letter
of Credit within said 30-day period, Tenant shall receive a
corresponding credit against, and shall be entitled to deduct from,
Annual Rent, the amount not so received together with interest
accruing thereon from the date such amount was drawn under the
Tenant’s Letter of Credit until such amount has been
satisfied in full, which deductions shall continue until such
credit is used in full. Tenant shall not be entitled to a credit
against Annual Rent nor shall Landlord have an obligation to pay
Tenant for any draw on Tenant’s Letter of Credit attributable
to Tenant’s failure to perform Environmental Remediation on
the Access Road Property. Any credit to which Tenant is entitled to
receive pursuant hereto shall be applied first to reduce the
monthly payments of Minimum Rent and then to reduce Percentage Rent
otherwise due, if any.
Landlord and Tenant shall
each be responsible for paying their respective pro rata share of
the costs and fees for the Air Force Letter of Credit and
Tenant’s Letter of Credit (including those relating to any
draw(s) as set forth above) based on the apportionme
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