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R-89-1317 - 8/24/1989ATTEST: WHEREAS, the City is in the process of preparing plans and specifications to advertise for bids for the construction and finance of a municipal golf course, and WHEREAS, in the event the golf course is constructed, the City wishes to contract for the operation of the course, and WHEREAS, CCA Silband Sports Corporation has submitted an Agreement of Sublease to provide such operation, and WHEREAS, the City Council desires to approve the form of said Agreement, Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Agreement of Sublease, a copy of which is attached hereto, is approved as to form, and a copy is authorized to be made a part of the information supplied to parties interested in bidding on the proposed golf course. RESOLVED this 24th day of August, 1989. E C- RS08249A ac Prob LAND, Ci y Secretary RESOLUTION NO. I3) ! MIKE ROBINSON, Mayor City of Round Rock, Texas AGREEMENT OF SUBLEASE BY AND BETWEEN CITY OF ROUND ROCK, TEXAS ( "Sublessor ") AND CCA SILBAND /GOLFCORP ( "Sublessee ") Draft August 15, 1989 A2396.1.114.20D For Discussion Only Prepared by: Page & Addison, P.C. 14651 Dallas Parkway, Suite 700 Dallas, Texas 75240 214/960 -0933 TABLE OF CONTENTS Article Page INTRODUCTION / RECITALS 1 1. DEFINITIONS Base Rent 1 Capital Reserve 1 Club I Commencement Date 1 Contracts 2 Easement and Rights 2 Extended Term 2 Golf Course Construction and Lease /Purchase Agreement 2 Gross Receipts 2 Gross Receipts Rent 3 Initial Term 3 Improvements 3 Improvements Plans and Specifications 3 Intangible Personal Property 3 Lease Year 4 Percentage Rent 4 Personal Property 4 Property 4 Real Estate Taxes 4 Real Property 4 Tax Year 4 Term 5 2. DEMISE; CONDITION PRECEDENT Sublessor's Option to Terminate 5 3. TERM Initial Term 5 Extended Term 5 Extensions Automatic 6 4. RENT 6 5. REAL ESTATE TAXES Real Estate Taxes 6 6. GENERAL RESPONSIBILITIES OF SUBLESSEE Operation of the Club 7 Maintenance 7 Commencement Date 7 Letter of Credit 8 Capital Reserve 8 Real Estate Taxes 8 7. GENERAL RESPONSIBILITIES OF SUBLESSOR Property 8 Improvements 8 Sublessor's Purchases 8 8. UTILITIES AND SERVICES Utilities and Services 9 9. SUBLESSOR'S COVENANTS AND REPRESENTATIONS 9 10. SUBLESSEE'S COVENANTS AND REPRESENTATIONS 13 11. INDEMNITY AND INSURANCE Sublessee's Indemnification 14 Sublessor's Indemnification 15 Sublessee's Insurance 15 Subrogation 16 12. DESTRUCTION BY FIRE OR OTHER CASUALTY Total Destruction 16 Partial Destruction 16 13. CONDEMNATION Notice of Taking 17 Effect of Entire Taking 17 Effect of Partial Taking 17 Sublessee's Award 18 14. RIGHT TO CURE Sublessor's Performance 18 Sublessee's Performance 18 Reimbursement 19 15. QUIET ENJOYMENT Quiet Enjoyment 19 Inspection /Maintenance of Property 19 16. SALE AND ASSIGNMENT Sublessee's Sale or Assignment 20 Effect of Assignment 20 17. EVENTS OF DEFAULT Sublessee's Default 20 Sublessor's Default 20 18. REMEDIES Sublessor's Remedies 22 Sublessee's Remedies 23 Attorneys' Fees 24 19. TERMINATION Termination 24 20. UNAVOIDABLE DELAYS 24 21. SUBLESSEE'S OBLIGATIONS Independent Corporation 25 Entire Agreement 25 22. NOTICES Notices 25 23 GENERAL PROVISIONS No Broker 26 Counterparts 27 Successors and Assigns 27 Time 27 Severability 27 Applicable Law 27 Amendment and Waiver 28 No Joint Venture 28 Exhibits 28 Captions 28 Survival 28 Governing Document 28 EXECUTION / ATTESTATION 29 AGREEMENT OF SUBLEASE Draft 08/15/89 For Discussion Only THIS AGREEMENT, made and entered into this day of , 1989, by and between CITY OF ROUND ROCK, TEXAS (hereinafter referred to as "Sublessor ") and CCA SILBAND/ GOLFCORP (hereinafter referred to as "Sublessee "), is as follows: R E C I T A L S WHEREAS, Sublessor is the lessee of certain real property in Round Rock, Texas (hereinafter referred to as the "Real Property "), upon which Sublessor will build a golf course facility to be known as " " (hereinafter referred to as the "Club "), together with all furniture, fixtures and equipment required to be located thereon for the purpose of operating said golf course facility (hereinafter referred as the "Personal Property "); and WHEREAS, Sublessee is desirous of entering into a long -term sublease agreement with respect to the Club, the Personal Property and the Real Property described above for the purpose of operating the Club, NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained herein, Sublessor and Sublessee agree as follows: ARTICLE 1. DEFINITIONS For purposes of this Agreement, the following terms shall have the meanings indicated: 1.1. Base Rent. The term "Base Rent" shall have the meaning set forth in Paragraph 4.1.1. 1.2. Capital Reserve. The term "Capital Reserve" shall mean those amounts at any given time allocated to an account for capital replacements and improvements within and to the Improvements, the Personal Property and the Real Property. 1.3. Club. The term "Club" shall mean the public golf facility to be known as " " to be located on the Real Property. 1.4. Commencement Date. The term "Commencement Date" shall mean the date the Club opens for general public usage. Agreement of Sublease - A2396.1.114.20D page 1 Draft 08/15/89 For Discussion Only 1.5. Contracts. The term "Contracts" shall be defined as the certain agreements and contracts concerning the operation of the Property as set forth on Exhibit "A" attached hereto. 1.6. Easements and Rights. The term "Easements and Rights" shall mean all rights of access, easements, rights -of -way and any other property rights which allow Sublessor, its agents or assigns, Sublessee and /or any other party, the right to use, gain access to, or otherwise benefit the Real Property, including, but not limited to, the right to use all adjacent roads, streets, gates, utility lines and water rights owned by Sublessor and required for the operation of the Club. 1.7. Extended Term. The term "Extended Term" shall mean any period of time beginning with the day following the termination date of either the Initial Term or the preceding Extended Term and terminating five (5) years thereafter. If notice is given as set forth in Section 3.2, there shall be up to nine (9) Extended Terms. 1.8. Golf Course Construction and Lease /Purchase Agreement. The term "Golf Course Construction and Lease /Purchase Agreement "' shall mean that certain agreement of even date herewith by and between and Sublessor, pursuant to which leased the Property to Sublessor pursuant to the terms set forth therein. 1.9. Gross Receipts. The term "Gross Receipts" shall mean all receipts related to or derived from the operation of the Club, computed on an accrual basis, from cash or credit transactions recognized after the Commencement Date, and shall include, but shall not be limited to, greens fees, cart fees, the amount of all sales (wholesale or retail) of food, beverages, goods, wares or merchandise on, at, or from the Property, or for services of any nature performed on, at, or from the Property, determined in accordance with generally accepted accounting principles applied on a consistent basis. Gross Receipts shall be reduced by any refunds, rebates, discounts and credits of a similar nature given, paid or returned by Sublessee in the course of obtaining such Gross Receipts. Gross Receipts shall not include: 1.9.1. Applicable gross receipts taxes, admission, cabaret, excise, sales and use taxes, or similar governmental charges collected as a part of the sales price of any goods or services; Agreement of Sublease - A2396.1.114.20D page 2 Draft 08/15/89 For Discussion Only 1.9.2. Income and revenues of licensees and concessionaires of Sublessee from the Property or any part thereof; provided, however, that all commissions, percentages or other payments received or earned by Sublessee from any licensee or concessionaire shall be included in Gross Receipts; 1.9.3. Service charges, which are defined to mean percentage gratuities added to billings as compensation to Sublessee's employees; 1.9.4. Proceeds of borrowings by Sublessee; 1.9.5. Proceeds paid as a result of an insurable loss; or 1.9.6. Interest or investment income earned on Gross Receipts. 1.10. Gross Receipts Rent. The term "Gross Receipts Rent" shall mean the rental amounts to be paid to Sublessor by Sublessee as set forth in Paragraph 4.1.2. 1.11. Initial Term. The "Initial Term" of this Agreement shall be for a period beginning on the date of this Agreement and ending on the later to occur of (i) the end of the term of the Golf Course Construction and Lease /Purchase Agreement, or (ii) the end of the time period pursuant to which all payments under the Golf Course Construction and Lease /Purchase Agreement are scheduled to be paid, unless sooner terminated as herein provided. 1.12. Improvements. The term "Improvements" shall mean (i) the improvements of any nature located or to be located on the Real Property (including, but not limited to, a clubhouse, an 18 -hole golf course and a maintenance facility), and any other improvements constructed or to be constructed on the Real Property. 1.13. Improvements Plans and Specifications. The term "Improvements Plans and Specifications" shall mean the plans and specifications for the Improvements as set forth on Exhibit "B" attached hereto and made a part hereof. 1.14. Intangible Personal Property. The term "Intangible Personal Property" shall mean all intangible property or rights owned or held in connection with the Club or the Property, including, but not limited to, security deposits, prepaid rents, liquor and operating licenses, and all trademarks related to the Club. Agreement of Sublease - A2396.1.114.20D page 3 Draft 08/15/89 For Discussion Only 1.15. Lease Year. The term "Lease Year" shall mean the period commencing with the date of this Agreement and ending twelve (12) calendar months thereafter, and each successive period of twelve (12) calendar months thereafter during the Term of this Agreement. 1.16. Percentage Rent. The term "Percentage Rent" shall mean the rental amounts to be paid to Sublessor by Sublessee as set forth in Paragraph 4.1.3. 1.17. Personal Property. The term "Personal Property" shall mean all equipment, machinery, fixtures, furnishings, accessories, and other tangible personal property placed or installed or to be placed or installed on or about the Real Property and to be used as a part of or in connection with the operation of the Club, including, but not limited to (i) all equipment, fixtures and furniture (ii) golf carts, (iii) restaurant equipment, (iv) golf course maintenance equipment, and (v) any other furniture, fixtures and equipment to be utilized by the Club, as determined by Sublessee to be required to operate a public golf course facility. 1.18. Property. The term "Property" shall mean (i) the Real Property, (ii) the Easements and Rights, (iii) the Personal Property, (iv) the Intangible Personal Property, (v) the Improvements, and (vi) any other contract or property rights owned by Sublessor related to the Real Property and the Personal Property. 1.19. Real Estate Taxes. The term "Real Estate Taxes" shall mean all taxes, assessments, excises, levies and other charges required to be paid upon or with respect to the Real Property, assessed, levied or imposed by any public authority having jurisdiction, whether general or special. Nothing herein contained shall require Sublessee to pay or be charged for any portion of (i) municipal, state or federal income taxes assessed against Sublessor, (ii) municipal, state or federal capital levy, estate, succession, inheritance or transfer taxes of Sublessor, (iii) corporation franchise taxes imposed upon Sublessor or any corporate owner of the fee of the Property, or (iv) any of the aforementioned taxes, assessments, excises, levies and other charges required to be paid with respect to the period prior to the Commencement Date. 1.20. Real Property. The term "Real Property" shall mean that certain parcel or parcels of land described in Exhibit "C" attached hereto. 1.21. Tax Year. The term "Tax Year" shall mean each fiscal year from time to time utilized by the taxing authorities having jurisdiction over the Real Property which occurs after the date of this Agreement. Agreement of Sublease - A2396.1.114.20D page 4 1.22. Term. The "Term" herein shall mean the Initial Term and the Extended Term if Sublessee has exercised its option to extend. ARTICLE 2. DEMISE; CONDITION PRECEDENT 2.1. Demise. Sublessor, for and in consideration of the rents, covenants and agreements herein reserved, mentioned and contained on the part of Sublessee to be paid, kept and performed, has demised and leased and by these presents does demise and lease unto Sublessee, and Sublessee, for and in consideration of the covenants and agreements herein reserved, mentioned and contained on the part of Sublessor to be kept and performed, does hereby take, lease and hire the Property, upon and subject to the terms, provisions and conditions hereinafter expressed and subject to the terms and provisions of the Golf Course Construction and Lease /Purchase Agreement, and stand in the place of Sublessor under the Golf Course Construction and Lease /Purchase Agreement. 2.2. Sublessor's Option to Terminate. Notwithstanding any provision herein contained to the contrary, this Agreement is subject to Sublessor obtaining sufficient financing to construct the Improvements to the Property required hereunder and pursuant to the Golf Course Construction and Lease /Purchase Agreement. Sublessor and Sublessee agree that in the event the foregoing condition precedent recited in this Section is not satisfied on or before , 19 , either party may, upon delivery of written notice to the other and within sixty (60) days thereafter, declare this Agreement null and void for all purposes, and the parties hereto shall automatically be released from all obligations hereunder. ARTICLE 3. TERM Draft 08/15/89 For Discussion Only 3.1. Initial Term. The Initial Term of this Agreement shall be for the period set forth in Section 1.11 hereof, unless sooner terminated as herein provided. 3.2. Extended Term. If Sublessee does not give written notice to extend this Agreement for any Extended Term to Sublessor at least ninety (90) days prior to the date of the commencement of any Extended Term, this Agreement shall automatically be terminated. If the notice to extend is forwarded by Sublessee, this Agreement shall be extended for the particular Extended Term upon the terms, conditions, covenants and provisions set forth herein: Agreement of Sublease - A2396.1.114.20D page 5 ARTICLE 4. RENT ARTICLE 5. Draft 08/15/89 For Discussion Only 3.3. Extensions Automatic. Such extensions shall be automatic without the necessity of any new lease or other instruments or agreements. 4.1. Sublessee covenants and agrees to pay to Sublessor for the Property the following sums without demand therefor: 4.1.1. The sums on the dates set forth on Exhibit "D" attached hereto ( "Base Rent "); and 4.1.2. Beginning in the fourth Lease Year beginning after the Commencement Date, and on the twenty -fifth day of each calendar month, an amount equal to the product of (i) Gross Receipts for the previous calendar month times (ii) three percent (3 %) ( "Gross Receipts Rent "). 4.1.3. Beginning in the first calendar month which begins after the final payment of Base Rent payable pursuant to Paragraph 4.1.1 and continuing throughout the remainder of the Term, on the twenty - fifth day of each calendar month, an amount equal to the sum of (i) the product of (a) Gross Receipts arising directly and solely from the food and beverage operations and pro shop sales at the Club for the particular calendar month times (b) five percent (5%), plus (ii) (a) Gross Receipts arising directly and solely from golf cart rentals, greens fees and practice range operations at the Club for the particular calendar month times (b) twenty percent (20 %) ( "Percentage Rent "). REAL ESTATE TAXES 5.1. Real Estate Taxes. During the Term of this Agreement, Sublessee shall pay all Real Estate Taxes for each Tax Year. Sublessee shall pay the Real Estate Taxes on the later of (i) ten (10) days prior to the end of the grace period granted by the taxing authorities for the payment of Real Estate Taxes, or (ii) thirty (30) days following receipt of the statement from the taxing authorities and receipt of necessary, supporting documents. Sublessee shall be entitled to any refund obtained by reason of a reduction in the assessed valuation made by the assessors or the courts. All expenditures for legal fees and other expenses reasonably necessary or advisable to obtain the Agreement of Sublease - A2396.1.114.20D page 6 ARTICLE 6. Draft 08/15/89 For Discussion Only tax refunds shall be paid by Sublessee. Sublessee shall have the right to request, by written notice to the other party given not less than thirty (30) days before the last date for filing any necessary protest or petition or taking any other necessary action, to initiate and prosecute any proceeding for the purpose of reducing the assessed valuation of the Property for tax purposes. Refunds obtained shall be payable to Sublessee to reimburse prior Real Estate Taxes actually paid by Sublessee. GENERAL RESPONSIBILITIES OF SUBLESSEE 6.1. Operation of the Club. Sublessee shall operate, maintain and manage the Club in a manner which Sublessee deems in its sole discretion to be necessary to operate a public golf club. Sublessee shall have the authority and duty to exercise all prerogatives of management with respect to the Club, including implementing all policies and procedures established by Sublessee, and performing any act necessary or desirable for the operation and management of the Club and the Property. 6.2. Maintenance. Sublessee shall have the responsibility to maintain all Personal Property which is leased to Sublessee hereunder in good working order, ordinary wear and tear excepted, and to replace the same, at Sublessee's expense, as determined in its discretion to be necessary to conduct the management and operation of the Club. 6.3. Commencement Date. From and after the Commencement Date and so long as it has not been excluded from possession of the Property by Sublessor, Sublessee shall, at its own expense, maintain, preserve and keep the Property in good repair, working order and condition, and shall from time to time make all repairs, replacements and improvements necessary to keep the Property in such condition. Sublessor shall have no responsibility for such maintenance or for any of these repairs, replacements or improvements. All such additions, modifications and improvements shall thereafter comprise part of the Property and be subject to the provisions of this Agreement. Such additions, modifications and improvements shall not in any way damage the Property nor cause it to be used for purposes other than those authorized under the provisions of State and Federal law; and the Property, upon completion of any additions, modifications and improvements made pursuant to this Section, shall be of a value not less than the value of the Property immediately prior to the making of such additions, modifications and improvements. Agreement of Sublease - A2396.1.114.20D page 7 Draft 08/15/89 For Discussion Only 6.4. Letter of Credit. Beginning on the date of the execution of the Golf Course Construction and Lease /Purchase Agreement, and continuing throughout the first twenty (20) Lease Years, Sublessee shall secure and maintain for the benefit of Sublessor a letter of credit assuring Sublessor of Sublessee's performance of its obligation to pay Base Rent, in the form of Exhibit "E" attached hereto. 6.5. Capital Reserve. Beginning in the fourth Lease Year, Sublessee shall, within sixty (60) days of the conclusion of each Lease Year, credit to the Capital Reserve a sum equal to three percent (3 %) of greens fees received by Sublessee in the previous Lease Year. 6.6. Real Estate Taxes. The Golf Course Construction and Lease /Purchase Agreement provides for the payment of Real Estate Taxes attributable to the period beginning with the date hereof and ending on the Commencement Date. Beginning with the Commencement Date, Sublessee shall pay Real Estate Taxes for each Lease Year. Notwithstanding anything contained herein to the contrary, with respect to the calendar year during which the Commencement Date occurs, Sublessee shall pay an amount for such year attributable to the period commencing on the Commencement Date through the balance of said year. Sublessee shall pay Real Estate Taxes on the later of (i) ten (10) days prior to the end of the grace period for the payment of Real Estate Taxes, or (ii) thirty (30) days following receipt of the tax statement. Sublessee shall be entitled to any refund obtained by reason of a reduction in the assessed valuation made by the assessors or the courts. Sublessee shall have the right to initiate and prosecute any proceeding for the purpose of reducing the assessed valuation of the Property for tax purposes. ARTICLE 7. GENERAL RESPONSIBILITIES OF SUBLESSOR 7.1. Property. On the Commencement Date, Sublessor shall deliver possession of the Property to Sublessee. 7.2. Improvements. Sublessor agrees to immediately commence construction of the Improvements to the Property pursuant to the specifications set forth in the Improvements Plans and Specifications. Sublessor shall obtain all permits necessary to construct the Improvements and shall maintain "Builder's Risk" and comprehensive liability insurance during the term of the construction, and shall indemnify and hold Sublessee harmless from any and all claims of any nature arising from the construction of the Improvements by Sublessor. Sublessor agrees to use all due diligence to complete the Improvements pursuant to the construction schedule set forth in the Improvements Plans and Specifications. Agreement of Sublease - A2396.1.114.20D page 8 ARTICLE 8. ARTICLE 9. Draft 08/15/89 For Discussion Only 7.3. Sublessor's Purchases. At the Commencement Date, Sublessor agrees to provide, at Sublessor's cost, all golf carts and maintenance equipment necessary for the operation of the Property, as determined by Sublessee. UTILITIES AND SERVICES 8.1. Utilities and Services. Sublessee agrees to pay all charges for utilities and services used by it on the Property, which shall be separately metered, including, but not limited to, gas, electricity, telephone, sanitary sewer, domestic water, fire protection, water and trash collection. Sublessor agrees to cooperate in the transfer of any bonds or deposits currently held by the utility companies to Sublessee's name, so that the utility accounts may be held in Sublessee's name and all statements forwarded directly to Sublessee's address. SUBLESSOR'S COVENANTS AND REPRESENTATIONS 9.1. Sublessor makes the following representations to Sublessee, which representations shall, unless otherwise stated herein, survive the execution and delivery of this Agreement and the Commencement Date: 9.1.1. Status. Sublessor is a duly formed and validly existing body corporate and political subdivision of the State, governed by the Constitution and the laws of the State. 9.1.2. Authorization. The Constitution and the laws of the State authorize Sublessor to enter into this Agreement and the transactions contemplated hereby and thereby; and to carry out its obligations under this Agreement. The officers of Sublessor executing this Agreement have been duly authorized to execute and deliver this Agreement under the terms and provisions of a resolution or resolutions of Sublessor's governing body or by other appropriate official action. 9.1.3. Compliance. Sublessor has complied with all open meetings and public bidding laws and all other State laws applicable to this Agreement and the acquisition of the Property by Sublessor. 9.1.4. Governmental Agencies. As of the date hereof, Sublessor has no knowledge of any existing conditions in or about the Property, or otherwise, which violate any city, county, state or federal law, ordinance or regulation, including, but not limited to, Agreement of Sublease - A2396.1.114.20D page 9 Draft 08/15/89 For Discussion Only regulations relating to zoning and use of the Property, and Sublessor has not received any notice, written or otherwise, from any governmental agency requiring the correction of any condition with respect to the Property which might be in violation of any law, ordinance or regulation. 9.1.5. Title to the Real Property, Existing Encumbrances. Pursuant to the Golf Course Construction and Lease /Purchase Agreement, Sublessor has good and indefeasible leasehold title to the Real Property, free and clear of all liens, claims and encumbrances of any nature, except those specific items set forth on Exhibit "F" (the "Existing Real Property Conditions "). 9.1.6. Access. There is no fact or condition which would result in the termination of the current access to the Real Property from existing roads or to sewer and other utility services, and Sublessor represents that on the Commencement Date the Real Property will enjoy access and service for sewers and all utilities (including, but not limited to, water, sewer, electricity and telephone facilities) available to the Real Property in sufficient quantities necessary to service the Property for use as a public golf course facility. 9.1.7. Zoning. The Real Property is properly zoned for use as a public golf course facility, including, but not limited to, the sale of alcoholic beverages. 9.1.8. Assessments. As of the date hereof, Sublessor has received no notice and has no knowledge of any pending improvements, liens or special assessments to be made against the Property by any governmental authority. 9.1.9. Violation of Representations. From and after the date hereof and until the termination of this Agreement, Sublessor shall not take any action or omit to take any action which would have the effect of violating any of the representations of Sublessor contained in this Agreement. 9.1.10. Violation of Agreement. Neither the execution and delivery of this Agreement by Sublessor nor Sublessor's performance of its obligations hereunder will result in a violation or breach of any term or provision or constitute a default or accelerate the performance required under any other agreement or document to which Sublessor is a party, or is otherwise Agreement of Sublease - A2396.1.114.20D page 10 Draft 08/15/89 For Discussion Only bound, or to which the Property, or any part thereof, is subject, and will not constitute a violation of any law, ruling, regulation or order to which Sublessor is subject. 9.1.11. Documentation. If necessary to carry out the intent of this Agreement and as allowable by law, Sublessor agrees to execute and provide to Sublessee, on or after the date hereof, any and all other instruments, documents, conveyances, assignments and agreements which Sublessee may reasonably request in connection with the operation of the Property, including, but not limited to, an assignment of Sublessor's contractual rights to all leased equipment and any licenses or permits. 9.1.12. Noninterference. If Sublessee shall keep and perform its covenants, conditions and obligations hereunder, Sublessor covenants and agrees that Sublessor will not, other than as permitted by this Agreement or required by law, interfere in any manner with Sublessee's operation, possession and management of the Property. 9.1.13. Litigation, Claims or Proceedings. To the best of Sublessor's knowledge, except as set forth on Exhibit "G" attached hereto, there are no existing or pending actions, suits, litigation, claims, proceedings or governmental investigations with respect to any aspect of any of the Property or the Club, nor, to the knowledge of Sublessor, have any such actions, suits, litigation, claims, proceedings or governmental investigations been threatened or asserted. Notwithstanding anything contained in this Agreement to the contrary, Exhibit "G" attached hereto is deemed and stipulated by Sublessor and Sublessee to be complete on the execution of this Agreement by the parties hereto. In the event that a lien, claim or cause of action affecting the Property or the Club should arise resulting from any activities by Sublessor prior to the Commencement Date, Sublessor shall advise Sublessee in writing. 9.1.14. Construction Claims. Sublessor shall hold Sublessee harmless from any unpaid bills or claims in connection with the construction of any improvements to the Property. 9.1.15. Improvements. The Improvements shall be or have been constructed and installed in compliance with: (i) all applicable laws, statutes, ordinances, codes, covenants, conditions and regulations, (ii) restrictions of any kind or nature affecting the Real Property, and (iii) any occupancy classification Agreement of Sublease - A2396.1.114.20D page 11 Draft 08/15/89 For Discussion Only applicable to the Club's operation. If, subsequent to the Commencement Date, it is determined that the Improvements have not been constructed in compliance with the obligations set forth herein, Sublessee shall, at Sublessee's cost and expense, furnish any structural or other changes required for compliance unless Sublessor agrees to make such changes. 9.1.16. Permits. All permits and licenses neces- sary for the operation and occupancy of the Property, including, but not limited to, all building and use permits, have been obtained for all operations of the Club, and no notice to revoke, suspend or terminate same has been received by Sublessor. Sublessor shall cooperate fully with Sublessee as necessary to enable Sublessee, to procure and /or transfer and maintain all licenses, permits or authorizations necessary for the operation of the Property. 9.1.17. Liens. From and after the date hereof and until the Commencement Date or earlier termination of this Agreement, Sublessor shall not sell, assign or create any right, title or interest whatsoever in or to the Property, or create or permit to exist any lien, encumbrance or charge thereon, without promptly discharging the same. 9.1.18. Mechanic's Liens. Sublessor shall satisfy any and all claims for mechanic's or materialmen's liens accruing prior to the Commencement Date; provided, however, Sublessor shall have the right to contest any such claims so long as a bond is posted by Sublessor and /or other procedures reasonably acceptable to Sublessee are followed in order to protect the Real Property and so long as no exception therefor appears in the title policy. 9.1.19. Contracts. There are no outstanding contracts, commitments, leases or agreements of any nature to which the Club, Sublessee or the Property is or may become subject. Sublessor further agrees not to enter into any contracts, commitments, leases or agreements after the date hereof to which the Club, Sublessee or the Property may be or become subject without the prior express written approval of Sublessee. 9.1.20. Warranties. Sublessor will maintain all warranties, guarantees and maintenance contracts on the equipment and furnishings of the Club and will endeavor to cause the reimbursement'of expenses for maintenance, repair and replacement, and for labor and materials associated with all warranted or guaranteed equipment and furnishings utilized in the operation of the Club. Agreement of Sublease - A2396.1.114.20D page 12 Draft 08/15/89 For Discussion Only 9.1.21. Sublessor's Violation. In the event of a violation of any of the representations made in this Article by Sublessor occurring subsequent to the date hereof, Sublessor shall promptly cure any condition created by such violation. In the event Sublessor fails to promptly cure said violation, Sublessee may take whatever action, at law or in equity, available to Sublessee as a result of said default, including, but not limited to, the right to (i) terminate this Agreement, or (ii) bring suit for specific performance and /or damages sustained by Sublessee as a result of Sublessor's default. No remedy herein conferred upon or reserved to Sublessee is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any breach by Sublessor shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. ARTICLE 10. SUBLESSEE'S COVENANTS AND REPRESENTATIONS 10.1. Sublessee makes the following representations to Sublessor, which representations shall, unless otherwise stated herein, survive the execution and delivery of this Agreement: 10.1.1. Corporate Status. Sublessee is a corporation duly organized, validly existing and in good standing under the laws of Texas, with full corporate power to enter into this Agreement and execute all documents required hereunder. 10.1.2. Authorization. The making, execution, delivery and performance of this Agreement by Sublessee has been duly authorized and approved by all requisite action of the Board of Directors of Sublessee, and this Agreement has been duly executed and delivered by Sublessee and constitutes a valid and binding obligation of Sublessee, enforceable in accordance with its terms. 10.1.3. Violation of Agreement. Neither the execution and delivery of this Agreement by Sublessee nor Sublessee's performance of its obligations hereunder will result in a violation or breach of any Agreement of Sublease - A2396.1.114.20D page 13 term of provision or constitute a default or accelerate the performance required under any other agreement or document to which Sublessee is a party or is otherwise bound or to which the Property or any part thereof is subject, and will not constitute a violation of any law, ruling, regulation or order to which Sublessee is subject. 10.1.4. Documentation. If necessary to carry out the intent of this Agreement, Sublessee agrees to execute and provide to Sublessor, on or after the date hereof, any and all other instruments, documents, conveyances, assignments and agreements which Sublessor may reasonably request in connection with the operation of the Property, including, but not limited to, an assignment of Sublessee's contractual rights to all leased equipment and any licenses or permits. 10.1.5. Taxes. All payroll taxes, sales taxes, license taxes, liquor taxes, use taxes, special assessments, and all other obligations or charges arising from and as a result of the ownership of the Property by the Sublessor and due any governmental or quasi- governmental authority, whether municipal, state, county or federal, accruing prior to the Commencement Date shall be paid in full by Sublessee. 10.1.6. Approval of Improvements Plans and Speci- fications. Sublessee agrees to review and provide written approval to Sublessor of the Improvements Plans and Specifications prior to the construction of the Improvements. ARTICLE 11. Draft 08/15/89 For Discussion Only INDEMNITY AND INSURANCE 11.1. Sublessee's Indemnification. Sublessee covenants to defend and save Sublessor and its officers and employees, while acting within the scope of their duties, harmless and indemnified from and against any and all actions, suits, proceedings, claims, demands, costs (including attorney's fees and court costs), expenses and liability of any kind or nature whatsoever, for injury to or death of person or damage of property (including property owned by Sublessor), which may be brought, made, filed against, imposed upon or sustained by Sublessor, its officers or employees, based upon or arising out of an act or omission of Sublessee, its officers, agents or employees. This indemnity shall not include claims based upon or arising out of the willful misconduct of Sublessor, its officers or employees. Further, this indemnity shall not require payment of a claim by Sublessor or its officers or employees as a condition precedent to Sublessor's recovery under same. Agreement of Sublease - A2396.1.114.20D page 14 Draft 08/15/89 For Discussion Only 11.2. Sublessor's Indemnification. Sublessor covenants and agrees to indemnify and save Sublessee and Sublessee's employees harmless from any and all costs, expenses, penalties, claims, demands and liabilities resulting from (i) any action or claim, or otherwise, arising with respect to Sublessor's operation or ownership of the Club or the Property, or the construction or acquisition of the Improvements, and (ii) any negligent act or omission of Sublessor or of its invitees, agents or employees, but this indemnity shall not extend to costs, expenses, penalties, claims, demands and liabilities resulting from acts of Sublessee, its employees or agents. 11.3. Sublessee's Insurance. Sublessee shall obtain, at its sole cost and expense, the following insurance concerning the Property and cause all contractors to maintain similar insurance, where appropriate: 11.3.1. Worker's compensation and employer's liability insurance as may be required under applicable laws covering all employees of Sublessee included in the operation of the Club, with such deductible limits as are generally established by Sublessee; 11.3.2. Comprehensive general public liability insurance against claims for bodily injury, death or property damage occurring on, in, or about the Property, and automobile insurance on vehicles operated in conjunction with the Property, with a combined single limit of not less than TWO MILLION DOLLARS ($2,000,000.00) each occurrence for personal injury, death, and property damage, with such deductible limits as are generally established by Sublessee; 11.3.3. Insurance on the Property, including the Improvements and Personal Property, against loss or damage by fire, lightning, flood, earthquake, and all other risks covered by the usual standard extended coverage endorsements, in such amounts and with such deductible limits as established by Sublessee and agreed to by Sublessor, all in an amount of not less than ninety percent (90 %) of the replacement cost thereof; and 11.3.4. Such other insurance in amounts as Sublessee, in its reasonable judgment, deems advisable for protection against claims, liabilities and losses arising out of, or connected with, the operation of the Property. Agreement of Sublease - A2396.1.114.20D page 15 ARTICLE 12. Draft 08/15/89 For Discussion Only All insurance provided by Sublessee under this Article 11 shall name Sublessee, Sublessor and as named insureds. Sublessee shall deliver to Sublessor, at least thirty (30) days prior to the Commencement Date, certificates of insurance with respect to all policies so procured, including existing, additional, and renewal policies, and in the case of insurance about to expire, shall deliver certificates of insurance with respect to the renewal policies not less than ten (10) days prior to the respective dates of expiration. All policies of insurance provided for under this Article 11 shall, to the extent obtainable, have attached thereto an endorsement that such policy shall not be cancelled or materially changed without at least thirty (30) days prior written notice to Sublessor and Sublessee. 11.4. Subrogation. Anything in this Agreement to the contrary notwithstanding, Sublessor and Sublessee each hereby waive any and all rights of recovery, claims, actions or causes of action against the other, its agents, officers and employees for any loss or damage that may occur to the Property, any personal property therein, or any improvements made thereto, or any part thereof, or any other real or personal property of either party by reason of fire, the elements, or any other cause which is insured against under the term of the policies of casualty insurance that Sublessee or Sublessor are required to provide hereunder or may otherwise carry, to the extent and only to the extent of any proceeds actually received by Sublessor or Sublessee, respectively, with respect thereto, regardless of cause or origin, including negligence of either party hereto, its agents, officers or employees, and each party covenants that no insurer shall hold any right of subrogation against the other. DESTRUCTION BY FIRE OR OTHER CASUALTY 12.1. Total Destruction. In the event that the Improvements are totally destroyed by fire or other casualty to the extent that the damage cannot be materially restored with due diligence within two hundred forty (240) days from the date construction commences, Sublessee may, at its option, terminate this Agreement by giving written notice to the other party within sixty (60) days following such damage or destruction. In the event of termination of this Agreement pursuant to this Section, this Agreement shall cease and come to an end as of the date of such damage or destruction as though such date were the date originally fixed for the expiration of the Term of this Agreement. 12.2. Partial Destruction. In the event the Improvements are damaged by fire or other casualty and such damage can be materially restored with due diligence within two hundred forty (240) days following the date construction commences, Sublessor Agreement of Sublease - A2396.1.114.20D page 16 ARTICLE 13. Draft 08/15/89 For Discussion Only shall have the obligation to repair the Improvements, as the case may be, as nearly as practicable to the condition same was in prior to such damage, but in no event shall Sublessor be required to expend funds in excess of proceeds of insurance received relating to the damage. Sublessor shall cause such repair to be commenced with all reasonable dispatch so as to complete the same at the earliest, reasonable possible date. CONDEMNATION 13.1. Notice of Taking. Sublessor shall, within ten (10) days of Sublessor's receipt of notice of a proposed and /or actual taking of the Real Property, or a portion of either, under any governmental law, ordinance or regulation, or by right of eminent domain, provide Sublessee (i) written notice of such proposed or actual taking, and (ii) a copy of the documents and /or pleadings received from the governmental authorities. 13.2. Effect of Entire Taking. If during the Term of this Agreement the entire Real Property shall be appropriated or taken for any public or quasi- public use under any governmental law, ordinance or regulation, or under the power of eminent domain by any public or quasi- public authority, then this Agreement and the Term hereof shall cease and come to an end as though such date were the date originally fixed for the expiration of the Term of this Agreement. 13.3. Effect of Partial Taking. If during the Term of this Agreement a portion of the Real Property shall be appropriated or taken for any public or quasi- public use under any governmental law, ordinance or regulation, or under the power of eminent domain by any public or quasi- public authority so as to render the Property substantially unusable for the purposes and in the manner contemplated herein, then, in such event, Sublessee shall have the right to cancel and terminate this Agreement by giving written notice to Sublessor within sixty (60) days after the receipt by Sublessee from Sublessor of written notice of such appropriation or taking. In the event of termination of this Agreement pursuant to this Section, then this Agreement shall cease and come to an end as of the date of such written notice by Sublessee as though such date were the date originally fixed for the expiration of the Term of this Agreement, and neither party shall have any obligation to the other arising out of or in any way connected with this Agreement by virtue of such termination. 13.3.1. In the event less than the whole of the Real Property are so appropriated or taken and Sublessee does not elect to terminate this Agreement and Sublessee remains in that portion of the Real Property which shall not have been appropriated or Agreement of Sublease - A2396.1.114.20D page 17 Draft 08/15/89 For Discussion Only taken, then, in such event, the rental payable hereunder to Sublessor shall abate until Sublessor has restored (and Sublessor hereby agrees, at Sublessor's cost and expense, to restore) the Property as far as possible to a complete unit of the like quality and character as existed prior to such appropriation or taking. Upon restoration of the Property to a like quality and character, the rent for the unexpired Term shall be reduced by that proportion which the area so taken shall bear to the entire area of the Real Property immediately prior to such taking. 13.4. Sublessee's Award. If this Agreement is terminated pursuant to the provisions of this Article, then the rent for the last month of Sublessee's occupancy shall be prorated and Sublessor agrees to refund to Sublessee all sums paid in advance. The damage award to be made pursuant to the condemnation proceedings shall be apportioned between Sublessor and Sublessee according to the value of their respective interests in the Property and this Agreement. ARTICLE 14. RIGHT TO CURE 14.1. Sublessor's Performance. After the expiration of any permitted grace period recited in this Agreement, if Sublessee shall have failed to cure any default in the performance of any covenant or promise on its part to be performed, Sublessor may, immediately, or at any time thereafter, without further notice, perform the same for the account and at the expense of Sublessee. Notwithstanding the above, in the case of an emergency (being defined as a situation involving the immediate threat of a loss of property or injury), Sublessor may, after notice to Sublessee, so perform in Sublessee's stead prior to the expiration of any applicable grace period; provided, however, Sublessee shall not be deemed in default under this Agreement. 14.2. Sublessee's Performance. After the expiration of any permitted grace period, if Sublessor shall have failed to cure any default in the performance of any covenant or promise on its part to be performed, Sublessee may, immediately, or at any time thereafter, without further notice, perform the same for the account and at the expense of Sublessor. Notwithstanding the above, in the case of an emergency, Sublessee may, after notice to Sublessor, so perform in Sublessor's stead prior to the expiration of any applicable grace period; provided, however, Sublessor shall not be deemed in default under this Agreement. Agreement of Sublease - A2396.1.114.20D page 18 Draft 08/15/89 For Discussion Only 14.3. Reimbursement. If, pursuant to this Article, Sublessor or Sublessee at any time is compelled or elects to (i) pay any sum of money, (ii) do any act which will require the payment of any sum of money, or (iii) incur any expense (including reasonable attorneys' fees) in instituting, prosecuting and /or defending any action or proceeding instituted by reason of Sublessee's or Sublessor's failure to reimburse, as herein provided, the sum or sums so paid or payable by Sublessor or Sublessee, as the case may be, with all interest, costs and damages, shall be immediately due from the other upon receipt of a statement therefor and shall be deemed to be additional rent hereunder or a credit thereto, as the case may be. ARTICLE 15. QUIET ENJOYMENT 15.1. Quiet Enjoyment. Sublessor, for itself, its successors and assigns, agrees that upon the payment of the rent herein reserved and upon the due performance and observance by Sublessee of the terms, covenants and conditions contained herein, Sublessee shall, and may, at all times during the Term of this Agreement, peaceably and quietly have, hold and enjoy the Property. Sublessor shall obtain for Sublessee from any present mortgagee or mortgagees of the Property a nondisturbance agreement assuring Sublessee that in the event of a default and /or foreclosure under such mortgage, Sublessee's possession and enjoyment of all of its rights under this Agreement shall continue unimpaired. Sublessor shall advise Sublessee of the status of the nondisturbance agreement within thirty (30) days of the date hereof, and if such agreement is not obtained, to proceed with all due diligence to obtain same. Additionally, contemporaneously with the execution of this Agreement, Sublessor is delivering to Sublessee a nondisturbance agreement executed by , assuring Sublessee that in the event of a default and /or termination of the Golf Course Construction and Lease /Purchase Agreement, Sublessee's possession and enjoyment of all of its rights under this Agreement shall continue unimpaired. 15.2. Inspection and Maintenance of Property. Sublessee agrees that Sublessor and and any representative of the Sublessor and shall have the right at all reasonable times to enter upon and to examine and inspect the Property. Sublessee further agrees that Sublessor and any representative of Sublessor and shall have such rights of access to the Property as may be reasonably necessary to cause the proper maintenance of the Property in the event of a Default herewith, or to carry out Sublessor's obligations and exercise Sublessor's rights under Article 17, or to determine whether Sublessee is in compliance with this Agreement. Agreement of Sublease - A2396.1.114.20D page 19 ARTICLE 16. Draft 08/15/89 For Discussion Only SALE AND ASSIGNMENT 16.1. Sublessee's Sale or Assignment. Sublessee shall not assign, sublet or permit an assignment by operation of law of this Agreement or any interest hereunder without the prior written approval of Sublessor. If this Agreement is assigned, Sublessor may collect rental from such assignee or sublessee and shall apply the net amount collected to the rental for which Sublessee is obligated to pay, but no such collection shall be deemed a waiver of Sublessor's prior approval or the acceptance of such assignee or sublessee as "tenant" hereunder. 16.2. Effect of Assignment. Any person who shall by operation of law or otherwise become an assignee of this Agreement or become vested with the leasehold interest hereunder, or a.portion thereof, shall be bound by and liable upon all covenants and provisions contained in this Agreement, but neither Sublessee nor any subsequent tenant whose interest is assigned or divested shall be relieved of liability hereunder. In the case of any transfer or vesting of the leasehold interest hereunder, or any part thereof, either through foreclosure proceedings or otherwise by operation of law, it shall be a condition to the validity of such transfer or vesting of interest that, if so requested by Sublessor, any person or persons claiming the leasehold interest hereunder, or any part thereof, so derived shall promptly execute and deliver to Sublessor a written assumption of the obligations of Sublessee hereunder, in such form so that such person or persons shall thereupon be bound by and liable upon all the covenants and provisions of this Agreement to the same extent as was Sublessee. ARTICLE 17. EVENTS OF DEFAULT 17.1. Sublessee's Default. The occurrence of any of the following events which is not cured in the time,permitted herein shall constitute a default under this Agreement (hereinafter referred to as a "Default "): 17.1.1. If Sublessee fails to pay any sums payable under this Agreement when and as the same shall become due and payable, and said failure shall continue for a period of thirty (30) days after written notice (specifying the item not paid) thereof from Sublessor to Sublessee to cure any payment failure. Agreement of Sublease - A2396.1.114.20D page 20 Draft 08/15/89 For Discussion Only 17.1.2. If Sublessee shall fail in the performance of or compliance with any of the covenants, agreements, terms or conditions contained in this Agreement, other than that referred to in the immediately preceding Paragraph, and such failure shall continue for a period of thirty (30) days after written notice thereof from Sublessor to Sublessee specifying in detail the nature of such failure, or, in the case such failure cannot be cured with due diligence within thirty (30) days, Sublessee fails to proceed promptly and with all due diligence to cure the same and thereafter to prosecute the curing of such failure with all due diligence [it being intended that in connection with a failure not susceptible of being cured with due diligence within thirty (30) days, that the time within which to cure the same shall be extended for such period as may be reasonably necessary to complete the same with all due diligence]. 17.2. Sublessor's Default. The occurrence of any of the following events which is not cured in the time permitted herein shall constitute a default under this Agreement (hereinafter referred to as a "Default "): 17.2.1. If Sublessor shall fail to pay any sums payable to Sublessee under this Agreement when and as the same shall become due and payable and such failure shall continue for a period of thirty (30) days after written notice thereof from Sublessee to Sublessor. 17.2.2. If Sublessor shall fail in the performance of or compliance with any of the covenants, agreements, terms or conditions contained in this Agreement and such failure shall continue for a period of thirty (30) days after written notice thereof from Sublessee to Sublessor specifying in detail the nature of such failure, or, in the case such failure cannot with due diligence be cured within thirty (30) days, Sublessor fails to proceed promptly and with all due diligence to cure the same and thereafter prosecute the curing of such failure with all due diligence [it being intended that in connection with a failure not susceptible of being cured with due diligence within thirty (30) days, that the time within which to cure the same shall be extended for such period as may be necessary to complete the same with all due diligence]. Agreement of Sublease - A2396.1.114.20D page 21 ARTICLE 19. Draft 08/15/89 For Discussion Only 18.3. Attorneys' Fees. In the event Sublessee or Sublessor should Default under any of the provisions of this Agreement and the nondefaulting party should employ attorneys or incur other expenses for the collection of rent or the enforcement of performance or observance of any obligation or agreement on the part of the defaulting party, the defaulting party shall, on demand therefor, pay to the nondefaulting party the reasonable fees of such attorneys and such other expenses reasonably incurred. TERMINATION 19.1. Termination. The Term of this Agreement shall terminate on the occurrence of any of the events set forth in Paragraphs 19.1.1 through 19.1.3 below: 19.1.1. A Default by Sublessee which is not cured within the time permitted and Sublessor sends to Sublessee a written notice of termination for cause; 19.1.2. A Default by Sublessor which is not cured within the time permitted and Sublessee sends to Sublessor a written notice of termination for cause; or 19.1.3. The expiration of the Term of this Agreement. ARTICLE 20. UNAVOIDABLE DELAYS 20.1. The provisions of this Section shall be applicable if there shall occur during the Term of this Agreement or prior to the Commencement Date any (i) acts of God, governmental restrictions, regulations or controls, enemy or hostile governmental action, civil commotion, fire, or other casualty; or (ii) other conditions similar to those enumerated in this Section beyond the reasonable control of the party obligated to perform. As the result of any of the above described events, if Sublessor or Sublessee shall fail punctually to perform any obligation on its part to be performed under this Agreement, then, upon written notice to the other, within ten (10) days of such event, such failure shall be excused and not be a breach of this Agreement by the party claiming an unavoidable delay, but only to the extent occasioned by such event. If any right or option of either party to take any action under or with respect to the Term of this Agreement is conditioned upon the same being exercised within any prescribed period of time or at or before a Agreement of Sublease - A2396.1.114.20D page 24 ARTICLE 18. REMEDIES Draft 08/15/89 For Discussion Only 18.1. Sublessor's Remedies. Upon the occurrence of a Default by Sublessee which is not cured within the time permitted, Sublessor shall be entitled to proceed with any and /or all of the following remedies: 18.1.1. With or without terminating this Agreement, reenter and take possession of the Property and the Improvements and exclude Sublessee from using it; provided, however, that if this Agreement has not been terminated, Sublessor shall return possession of the Property and the Improvements to Sublessor when the event of Default is cured; and provided further that Sublessee shall continue to be responsible for the rental payments due with respect to the periods when the Sublessee is in possession of the Property; or 18.1.2. With or without terminating this Agreement, reenter and take possession of the Property and the Improvements and sublease the Property and the Improvements or sell its leasehold interest; provided, however, that nothing contained herein shall impose an obligation upon Sublessor so to sublease or sell its interest in the Property and the Improvements; or 18.1.3. With or without terminating this Agreement, declare all rent then outstanding plus interest accrued on such amount to be immediately due and payable by Sublessee, whereupon such amount shall be immediately due and payable; or 18.1.4. Remedy any Default of Sublessee, and in connection with such remedy, Sublessor may pay all expenses and employ counsel, and all sums so expended or obligations incurred by Sublessor in connection therewith shall be paid by Sublessee to Sublessor, upon demand by Sublessor, and on failure of such reimbursement, Sublessor may, at Sublessor's option, deduct all costs and expenses incurred in connection with remedying a Default of Sublessee from the next sums subsequently becoming due to Sublessee from Sublessor under the terms of this Agreement; or 18.1.5. Enforce its rights and remedies by suit, action at law, or other appropriate proceeding, whether one or more, and /or bring an action for enforcement or specific performance of any covenant, promise or agreement or condition contained in this Agreement; or Agreement of Sublease - A2396.1.114.20D page 22 Draft 08/15/89 For Discussion Only 18.1.6. Terminate this Agreement, in which event, all obligations of Sublessor to Sublessee under this Agreement shall forthwith terminate; and /or 18.1.7. No remedy herein conferred upon or reserved to Sublessor is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative. No delay or omission to exercise any right or power accruing upon any Default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. 18.2. Sublessee's Remedies. Upon the occurrence of a Default which is not cured by Sublessor within the time permitted, Sublessee shall be entitled to proceed with any and /or all of the following remedies: 18.2.1. Remedy any Default of Sublessor, and in connection with such remedy, Sublessee may pay all expenses and employ counsel, and all sums so expended or obligations incurred by Sublessee in connection therewith shall be paid by Sublessee to Sublessee, upon demand by Sublessee, and on failure of such reimbursement, Sublessee may, at Sublessee's option, deduct all costs and expenses incurred in connection with remedying a Default of Sublessor from the next sums subsequently becoming due to Sublessor from Sublessee under the terms of this Agreement; 18.2.2. Enforce its rights and remedies by suit, action at law, or other appropriate proceeding, whether one or more, and /or bring an action for enforcement or specific performance of any covenant, promise or agreement or condition contained in this Agreement; 18.2.3. Terminate this Agreement, in which event, all obligations of Sublessee to Sublessor under this Agreement shall forthwith terminate. 18.2.4. No remedy herein conferred upon or reserved to Sublessee is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative. No delay or omission to exercise any right or power accruing upon any Default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. Agreement of Sublease - A2396.1.114.20D page 23 ARTICLE 21. Draft 08/15/89 For Discussion Only named date, then such prescribed period of time or such named date shall be deemed to be extended or delayed, as the case may be, upon written notice, as provided above, for a time equal to the period of the unavoidable delay. Notwithstanding anything contained herein to the contrary, the provisions of this Section shall not be applicable to Sublessee's or Sublessor's obligation to pay any sums, monies, costs, charges or expenses required to be paid pursuant to the terms of this Agreement. SUBLESSEE'S OBLIGATIONS 21.1. Independent Corporation. Sublessor recognizes and acknowledges that Sublessee is an independent corporation, chartered under the laws of the State of California, and is solely responsible for the obligations and liabilities recited herein, arising hereunder, or in any manner related to the transactions contemplated hereby, and Sublessor further recognizes and acknowledges that no other entity or entities, including (i) Sublessee's shareholders, (ii) any officer, employee or individual, or (iii) any corporation affiliated with Sublessee, is in any manner liable or responsible for the obligations and liabilities of Sublessee, whether recited herein, arising hereunder, or in any manner related to the transactions contemplated hereby. 21.2. Entire Agreement. This Agreement embodies the entire agreement and understanding of Sublessor and Sublessee relating to the subject matter hereof and supersedes all prior representations, agreements and understandings, oral or written, relating to such subject matter. Neither this Agreement nor any provision hereof may be amended, enlarged, modified, waived, discharged or terminated orally, but only as expressly provided herein or by an instrument signed by Sublessor and Sublessee. ARTICLE 22. NOTICES 22.1. Notices. Any notices or other communications required or permitted hereunder shall be sufficiently given if in writing and (i) delivered personally, (ii) forwarded by prepaid telegram, or (iii) sent by certified mail, return receipt requested, postage prepaid, addressed as shown below, or to such other address as the party concerned may substitute by written notice to the other. All notices personally delivered shall be deemed received on the date of delivery. All notices forwarded by prepaid telegram shall be deemed received two (2) days after the date same are sent. All notices forwarded by mail shall be deemed received on a date seven (7) days (excluding Sundays and holidays) immediately following date of deposit in the U.S. mail; Agreement of Sublease - A2396.1.114.20D page 25 i • If to Sublessor: City of Round Rock, Texas With a copy to: If to Sublessee: CCA Silband /GolfCorp ARTICLE 23. Draft 08/15/89 For Discussion Only provided, however, the return receipt indicating the date upon which all notices were received shall be prima facie evidence that such notices were received on the date on the return receipt. With a copy to: Page & Addison, P.C. 14651 Dallas Parkway, Suite 700 Dallas, Texas 75240 The addresses and addressees may be changed by giving notice of such change in the manner provided herein for giving notice. Unless and until such written notice is received, the last address and addressee given shall be deemed to continue in effect for all purposes. No notice to either Sublessor or Sublessee shall be deemed given or received unless the entity noted "With a copy to" is simultaneously delivered notice in the same manner as any notice given to either Sublessor or Sublessee. GENERAL PROVISIONS 23.1. No Broker. Sublessor and Sublessee each warrant that no real estate broker or person acting as such was consulted or dealt with by them in connection with or had any part in interesting them to enter into this Agreement. Each party shall hold the other harmless from any liability or expense incurred by the other party because of any claim for commission, fees or other compensation made by any real estate broker or other person based on claims contrary to this warranty. Agreement of Sublease - A2396.1.114.20D page 26 • Draft 08/15/89 For Discussion Only 23.2. Counterparts. This Agreement may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument. 23.3. Successors and Assigns. This Agreement and the terms and provisions hereof shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns whenever the context so requires or permits. 23.4. Time. Time is of the essence in this Agreement and each and all of its provisions. Any extension of time granted for the performance of any duty or obligation under this Agreement shall not be considered an extension of time for the performance of any other duty or obligation under this Agreement. 23.5. Severability. Except as expressly provided to the contrary herein, each section, part, term or provision of this Agreement shall be considered severable, and if for any reason any section, part, term or provision herein is determined to be invalid and contrary to or in conflict with any existing or future law or regulation by a court or agency having valid jurisdiction, such determination shall not impair the operation of or have any other affect on other sections, parts, terms or provisions of this Agreement as may remain otherwise intelligible, and the latter shall continue to be given full force and effect and bind the parties hereto, and said invalid sections, parts, terms or provisions shall be deemed not to be a part of this Agreement. 23.6. Applicable Law. This Agreement has been executed and delivered in the State of Texas and shall be construed in accordance with the laws of the State of Texas. Any action brought to enforce or interpret this Agreement shall be brought in the court of appropriate jurisdiction in the jurisdiction in which the Property is located. Should any provision of this Agreement require judicial interpretation, it is agreed that the court interpreting or considering same shall not apply the presumption that the terms hereof shall be more strictly construed against a party by reason of the rule or conclusion that a document should be construed more strictly against the party who itself or through its agent prepared the same; it being agreed that all parties hereto have participated in the preparation of this Agreement and that legal counsel was consulted by each responsible party before the execution of this Agreement. Agreement of Sublease - A2396.1.114.20D page 27 a• Draft 08/15/89 For Discussion Only 23.7. Amendment and Waiver. This Agreement may not be amended or modified in any way except by an instrument in writing executed by all parties hereto; provided, however, either Sublessor or Sublessee may, in writing, (i) extend the time for performance of any of the obligations of the other, (ii) waive any inaccuracies and representations by the other contained in this Agreement, (iii) waive compliance by the other with any of the covenants contained in this Agreement, and (iv) waive the satisfaction of any condition that is precedent to the performance by the party so waiving of any of its obligations under this Agreement. 23.8. No Joint Venture. Nothing contained herein shall be deemed or construed by the parties hereto or by any third party as creating the relationship of (i) principal and agent, (ii) a partnership, or (iii) a joint venture between the parties hereto; it being understood and agreed that neither any provisions contained herein nor any acts of the parties hereto shall be deemed to create any relationship between the parties hereto other than the relationship of Sublessor and Sublessee. 23.9. Exhibits. All Exhibits attached hereto are incorporated herein by this reference as if fully set forth herein; provided, however, in the event that at the time of the execution of this Agreement any of the Exhibits to be attached are incomplete, the parties shall use their best efforts to complete such Exhibits at the earliest possible date. To the extent this Agreement may be rendered unenforceable by the lack of completion of any of the Exhibits, such defect shall be cured as such incomplete Exhibits are made complete in accordance with this Section, except to the extent that such Exhibits are deemed and stipulated by the parties to be complete on the execution of this Agreement by the parties hereto. If any Exhibits are subsequently changed by the mutual written agreement of the parties, the Exhibits shall be modified to reflect such change or changes and initialed by the parties. 23.10. Captions. Captions, titles to sections and paragraph headings used herein are for convenience or reference and shall not be deemed to limit or alter any provision hereof. 23.11. Survival. All covenants, agreements, representations and warranties made herein shall survive the execution and delivery of this Agreement. All other documents and instruments to be executed and delivered in accordance herewith shall continue in full force and effect. 23.12. Governing Document. This Agreement shall govern in the event of any inconsistency between this Agreement and any of the Exhibits attached hereto. Agreement of Sublease - A2396.1.114.20D page 28 IN WITNESS WHEREOF, the parties hereto have caused this Agreement of Sublease to be executed by their proper, duly authorized corporate officers, all as of the day and year first above set forth. Sublessor: CITY OF ROUND ROCK, TEXAS By: Title: Sublessee: Attest: CCA SILBAND /GOLFCORP By: By: Title Title: Draft 08/15/89 For Discussion Only Agreement of Sublease - A2396.1.114.20D page 29 EXHIBITS TO AGREEMENT OF SUBLEASE BY AND BETWEEN CITY OF ROUND ROCK, TEXAS AND CCA SILBAND /GOLFCORP CONTRACTS 'A" IMPROVEMENTS,PLANS AND. SPECIFICATIONS " REAL PROPERTY nC" RASE RENT nDn LETTER OF CREDIT nEu EXISTING REAL PROPERTY CONDITIONS „ LITIGATION, CLAIMS, OR PROCEEDINGS "Go CONTRACTS (None Except as Listed Below) Exhibit "A" - A2396.1.80.10A solo page Exhibit "B" - A2396.1.80.36A IMPROVEMENTS PLANS AND SPECIFICATIONS (TO Be Provided By Sublessor) solo page Exhibit "C" - A2396.1.80.15A REAL PROPERTY (To Be Provided By Sublessor) Solo page Exhibit "D" - A2396.1.80.999A BASE RENT Tn Be provided By Sublessor) page 1 Exhibit "E" - A2396.1.999.999A LETTER OF CREDIT (To Be Agreed Upon by All Parties) page 1 Exhibit "F" - A2396.1.80.13A EXISTING REAL PROPERTY CONDITIONS (None Except as Listed Below) solo page OUTSTANDING LITIGATION, CLAIMS OR PROCEEDINGS (None Except as Listed Below) Exhibit "G" - A2396.1.80.17A solo page