R-2023-359 - 10/26/2023 RESOLUTION NO. R-2023-359
WHEREAS, the City of Round Rock ("City") approved that certain Convention Center
Operating Lease with KR CC, Inc. dated April 26, 2018; and
WHEREAS, the Bank of Wisconsin Dells ("Bank") has agreed to provide financing to KR CC,
Inc. and KR Acquisitions LLC for the Premises; and
WHEREAS, the Bank has requested that the City approve a Landlord Consent and Estoppel
regarding the Convention Center Operating Lease, a copy of which is attached hereto as Exhibit "A",
Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK,TEXAS,
That the Mayor is hereby authorized and directed to execute on behalf of the City the attached
Landlord Consent and Estoppel, a copy of same being attached hereto as Exhibit "A" and incorporated
herein for all purposes.
The City Council hereby finds and declares that written notice of the date, hour, place and
subject of the meeting at which this Resolution was adopted was posted and that such meeting was
open to the public as required by law at all times during which this Resolution and the subject matter
hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act,
Chapter 551, Texas Government Code, as amended.
RESOLVED this 26th day of October, 2023.
CRAIG ORG , Mayor
City of Round PyKck, Texas
ATTEST:
MEAGAN S NKS, ity Clerk
EXHIBIT
„A„
LANDLORD CONSENT AND ESTOPPEL
This Landlord Consent and Estoppel ("Agreement") is made as of
2023 by and among CITY OF ROUND ROCK, TEXAS ("Landlord"), KR CC, LLC
("Tenant'), KR ACQUISITIONS LLC ("Acquisitions" and together with Tenant, "Borrower") and
BANK OF WISCONSIN DELLS (together with its successors and assigns, "Secured Party"). As used
in this Agreement,the following terms shall have the meanings given opposite such terms:
Lease CONVENTION CENTER OPERATING LEASE dated April
26 2018
Landlord CITY OF ROUND ROCK TEXAS
Tenant KR CC,INC.
Borrower KR CC,INC. and KR ACQUISITIONS LLC
Secured Party BANK OF WISCONSIN DELLS,its successors and assigns
Premises Approximately 9.476 acres described on Exhibit A
Property Address _
Lease Expiration Date 11:59 .m.,December 19 2115
Expiration Date At End of Renewal N/A
Options;Description of Renewal
Options
Purchase Option As defined in the Lease
Option Purchase Price One Dollar $1.00
Any capitalized term not defined herein shall have the meaning ascribed to it under the Lease.
Secured Party will provide one or more credit facilities (as amended, from time to time, the
"Financing Arrangements") to Borrower, secured by, among other collateral, (i) all of Borrower's
business assets, including without limitation, furniture, moveable trade fixtures, signage, equipment,
sprinkler systems, heating and air conditioning, lighting, compressors, condensers, furnaces and other
personal property (all of which is referred to hereinafter the"Collateral")which are presently located or
may at any time hereafter be located in, at or upon the Premises, but excluding fixtures attached to the
Premises and owned by Landlord, and (ii) Borrower's pledge and assignment of its leasehold interest in
the Premises pursuant to one or more leasehold mortgages or deeds of trust and/or collateral assignments
of lease covering Lease Agreements dated as of the date hereof or in the future given by Borrower for the
benefit of Secured Party (collectively, the "Leasehold Mortgage"). As a condition to the Financing
Arrangements, Secured Party has requested that Borrower coordinate and obtain Landlord's
acknowledgment and agreement with respect to certain matters pertaining to the Lease and any subleases,
licenses, concession or other occupancy agreements permitted thereunder (collectively, the "Lease
Agreements"). Landlord and Borrower hereby acknowledge,confirm to and agree with Secured Party as
follows:
1. Premises and Lease: Landlord is the holder of the landlord's interest under the Lease.
The Lease is in full force and effect and has not been modified or amended except as otherwise noted or
attached on Exhibit B hereto. Landlord confirms that Tenant is the current holder of the tenant's interest
tinder the Lease.
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2. Notice of Default: Landlord agrees to provide written notice of Tenant's default under
the Lease. Secured Party's address for notice purposes is:
Bank of Wisconsin Dells
716 Superior Street
Wisconsin Dells,WI 53965
Attn: Kelly Bauer
Secured Party agrees to provide written notice of Borrower's default under the Financing Arrangements
to Landlord contemporaneously with delivery of its notice to Borrower. Landlord's address for notice
purposes is:
City of Round Rock, Texas
221 E. Main Street
Round Rock,TX 78664
Attn: City Manager.
3. Rent and Char eg sue: All rent and other charges payable by Tenant under or pursuant
to the Lease are currently paid in full,including without limitation the Initial Rent Payment.
4. No Default: To the best of Landlord's and Borrower's knowledge, neither Landlord nor
Borrower is in breach or default under any of the terms and conditions of the Lease or any of the Lease
Agreements, and no event or circumstance has occurred or exists which with the passage of time and/or
the giving of notice would constitute a breach or default under the Lease or any of the Lease Agreements.
Landlord has not given or received any notice of any breach or default under the Lease.
5. No Termination Event: Landlord has not taken any action to terminate the Lease.
6. Expiration Date: The Lease expiration date is accurately set forth above.
7. Purchase Option: The Lease provides Tenant with a purchase option to purchase the
Premises under the Lease. Landlord and Secured Party hereby acknowledge and agree, that (i) Secured
Party has the right to take an assignment of and exercise the purchase option granted to Tenant under the
Lease, and(ii) subject to the terms of the Financing Arrangements, Tenant shall assign to Secured Party
the purchase rights granted to it in the Lease. The Option Purchase Price is accurately set forth above.
8. Consent to Pledge of Collateral and Leasehold Mortgage: Landlord hereby consents to
the pledge by Borrower to Secured Party of a security interest in the Collateral and Borrower's leasehold
interest in the Premises (whether under the Lease or under any of the Lease Agreements) and, in Secured
Party's sole discretion,the recording of such documents and instruments as may be reasonably necessary
to create and perfect such liens.
9. Disclaimer/Subordination of Interest In Collateral;Access:
a. Disclaimer/Subordination: For so long as Borrower is indebted or otherwise obligated to
Secured Party, Landlord hereby disclaims any interest in the Collateral which is now or hereafter
located in, at or upon the Premises. Further, for so long as Borrower is indebted or otherwise
obligated to Secured Party, Landlord subordinates its interest in the Collateral to the interest of
Secured Party and will not assert against the Collateral(including any equipment or trade fixtures
at the Premises) any statutory, common law, possessory or other liens or encumbrances that
Landlord has or hereafter may have.
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b. Access: Secured Party shall have the right, at its election, to enter onto the Premises
during normal business hours for purposes of inspection and, pursuant to the terms of the
Financing Arrangements, the enforcement of its security interest in the Collateral, including,
without limitation, the sale and removal of the Collateral, provided, however, that (i) Secured
Party or its representatives shall maintain reasonably appropriate insurance at the time of any
such entry and (ii) if Secured Party shall remove any of the Collateral, Secured Party shall
reimburse Landlord for the reasonable and necessary cost of repair of any physical injury to the
Premises directly caused by such removal, but not for any diminution in value caused by such
removal.
10. Effect of the Leasehold Mortgage. Borrower's granting of the Leasehold Mortgage to
Secured Party shall not be deemed to constitute an Assignment of the Leasehold Estate,nor shall Secured
Party, as a Leasehold Mortgagee, or in the exercise of its rights under the Leasehold Mortgage or under
the Lease or under the Lease Agreements, be deemed to be an assignee or transferee or mortgagee in
possession of the Leasehold Estate so as to require Secured Party, as such Leasehold Mortgagee, to
assume or otherwise be obligated to perform any of Borrower's obligations under the Lease or the Lease
Agreements except when, and then only for so long as, Secured Party as such Leasehold Mortgagee has
acquired ownership and possession of the Leasehold Estate pursuant to a Foreclosure Event (as distinct
from its rights under this Agreement or the Lease or the Lease Agreements to cure defaults or exercise
Mortgagee's Cure Rights). No Secured Party or other Person acquiring the Leasehold Estate pursuant to
a Foreclosure Event shall have any liability beyond its interest under this Agreement or the Lease or the
Lease Agreements nor shall Secured Party or any Person acquiring the Leasehold Estate pursuant to a
Foreclosure Event be liable under the Lease or the Lease Agreements unless and until such time as it
becomes the owner of the Leasehold Estate. Landlord recognizes and agrees that Secured Party may
acquire directly,or may cause its assignee,nominee,or designee to acquire,the Leasehold Estate through
a Foreclosure Event and such party shall enjoy all the rights and protections granted to Secured Party
hereunder or to a Leasehold Mortgagee under the Lease or the Lease Agreements with the same force and
effect as if such party were Secured Party or the Leasehold Mortgagee itself.
11. Foreclosure, Further Assignment. Notwithstanding anything to the contrary in the Lease
or the Lease Agreements, any Foreclosure Event or any exercise of rights or remedies under the
Leasehold Mortgage shall not be deemed to violate the Lease or the Lease Agreements or require the
consent of Landlord. If Secured Party or a successor or assignee of Secured Party,or an Affiliate thereof,
acquires Borrower's Leasehold Estate following a Foreclosure Event,or if Secured Party or a successor or
assignee of Secured Party, or an Affiliate thereof, enters into a New Agreement, Secured Party or
successor or assignee of Secured Party,or an Affiliate thereof, shall enjoy all of the rights and protections
granted to Leasehold Mortgagee under the Lease or the Lease Agreements with the same force and effect
as if such successor,assign or Affiliate were the Leasehold Mortgagee itself and may thereafter assign or
transfer the Lease or the Lease Agreements or such New Agreement without prior notice to or consent of
Landlord; provided, that the assignee or transferee expressly agrees in writing to assume and to perform
all of the obligations under the Lease or the Lease Agreements or such New Agreement, as the case may
be, from and after the effective date of such assignment or transfer. No Leasehold Mortgagee(or Person
acquiring the Leasehold Estate pursuant to a Foreclosure Event under a Leasehold Mortgage) shall have
any liability beyond its interest in the Lease or the Lease Agreements nor shall Leasehold Mortgagee(or
person acquiring the Leasehold Estate pursuant to a Foreclosure Event under a Leasehold Mortgage) be
liable under the Lease or the Lease Agreements unless and until such time as it becomes, and then only
for so long as it remains,the owner of the Leasehold Estate.
12. Leasehold Mortgagee: Assigns. Landlord acknowledges receipt of a true and correct
copy of the Leasehold Mortgage together with written notification specifying the name and address of
Secured Party. Secured Party shall be entitled to all the rights and protections of a Leasehold Mortgagee
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under the Lease, and the provisions of Section 16 of the Lease regarding Leasehold Mortgages are
incorporated herein by reference. Following notification of any Assignment of such Leasehold Mortgage,
Landlord shall confirm that such successor, assign or Affiliate of Secured Party is or will be,upon closing
of its acquisition of the Leasehold Mortgage, entitled to all of the rights and protections granted to a
Leasehold Mortgagee under the Lease with the same force and effect as if such successor, assign or
Affiliate were the Secured Party itself, in the Lease, including after any premature termination of the
Lease.
13. Further Assurances. Upon request by Secured Party, Landlord shall deliver to the
Secured Party such documents and agreements as Secured Party shall reasonably request to further
effectuate the terms of the Lease or the Lease Agreements, including a separate written instrument in
recordable form signed and acknowledged by Landlord setting forth and confirming, directly for the
benefit of Secured Party and its successors and assigns, any or all rights of a Leasehold Mortgagee;
provided, however, that Borrower shall reimburse Landlord immediately upon demand therefor for any
and all reasonable third party costs or expenses actually incurred by Landlord in complying with this
requirement.
14. Priority of Leasehold Mortgages. If there is more than one Leasehold Mortgage, then
whenever the Lease provides a Leasehold Mortgagee with the right to consent or approve or exercise any
right granted in the Lease, the exercise or waiver of same by Secured Party shall control and be binding
upon the holder(s) of all junior Leasehold Mortgages or other holders of debt, such as Mezzanine
Lenders.
15. Rights of Landlord. Secured Party agrees with the following requirements:
a. the Leasehold Mortgage and all rights acquired thereunder shall be subject to each and all of
the covenants, conditions, restrictions and provisions set forth in the Lease and the Lease
Agreements,and to all rights of Landlord thereunder; and
b. Secured Party shall not, and the Leasehold Mortgage does not, encumber any interest in
real property other than Borrower's leasehold interest in the Property, or secure debt which is not
utilized for the purpose of the Project.
16. Counterparts: This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original.
17. Modification. This Agreement may only be modified by a written document signed by
all of the parties hereto. A signature to this Agreement delivered by electronic means (such as by
facsimile or by email in"pdf'format)shall be deemed an original signature hereto for all purposes.
18. Remain in Effect. This Agreement shall remain in effect until the date on which
Borrower has paid and performed all its obligations and liabilities under the Financing Arrangements.
[Signature page follows]
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The Landlord and Borrower have executed and delivered this Landlord Estoppel and Consent as
of the date first above written.
Landlord: CITY OF ROUND ROCK,TEXAS
Address of Landlord:
By:
221 E.Main Street Name: Craig Morgan
Round Rock,TX 78664 Title: Mayor
Attn: City Manager
APPROVED as to form:
Stephanie L. Sandre, City Attorney
(Signatures on Following Pages)
Signature Page—Landlord Consent&Estoppel(CC)-Landlord
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Tenant: KR CC,INC.,a Delaware corporation
Address of Tenant:
P.O. Box 590 By:
1305 Kalahari Drive Name: Todd Nelson
Wisconsin Dells,WI 53965 Title: President
Attn: Mary Bonte Spath
Tenant: KR ACQUISITIONS LLC a Delaware
limited liability company
Address of Tenant:
P.O. Box 590 By:
1305 Kalahari Drive Name: Todd Nelson
Wisconsin Dells,WI 53965 Title: President
Attn: Mary Bonte Spath
(Signatures on Following Page)
Signature Page—Landlord Consent&Estoppel(CC) -Tenant
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Secured Party: BANK OF WISCONSIN DELLS
Address of Lender:
716 Superior Street By:
Wisconsin Dells,WI 53965 Name: Kelly Bauer
Attn: Kelly Bauer Title: Senior Vice President
Signature Page—Landlord Consent&Estoppel(CC)-Lender
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Exhibit A
(Legal Description of the Convention Center Premises)
LOT 2, BLOCK "C", FINAL PLAT OF KALAHARI RESORT AND REPLAT OF BERTIL
TELANDER SUBDIVISION, RECORDED APRIL 27, 2018 AS DOCUMENT NUMBER
2018035349 IN THE OFFICE OF THE CLERK OF WILLIAMSON COUNTY, TEXAS.
Exhibit A—Landlord Consent&Estoppel(CC)
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Exhibit B
(Lease and Amendments)
Exhibit B—Landlord Consent&Estoppel(CC)
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