Contract - KR CC, Inc. - 4/26/2018 (3) CONVENTION CENTER OPERATING LEASE
between
CITY OF ROUND ROCK, TEXAS
and
KR CC, INC.
Dated as of
CONVENTION CENTER
ROUND ROCK, TEXAS
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TABLE OF CONTENTS
Page
1. Definitions..........................................................................................................................2
2. Lease and Grant of Use; Reservation of Rights; Term................................................. 6
2.1 Lease and Grant of Use......................................................................................... 6
2.2 Reserved.................................................................................................................. 7
2.3 Term........................................................................................................................ 7
3. Intangible Rights...............................................................................................................7
3.1 Grant of License..................................................................................................... 7
4. Rent.................................................................................................................................... 8
4.1 Rent......................................................................................................................... 8
4.2 Timing of Payment................................................................................................. 8
5. Taxes; Operations; Capital Repairs; Recordkeeping....................................................8
5.1 Tenant's Sole Cost................................................................................................. 8
5.2 Tax Matters............................................................................................................ 8
5.3 Operations and Management................................................................................ 9
6. Advertising; Media......................................................................................................... 10
6.1 Advertising............................................................................................................ 10
6.2 Naming Rights...................................................................................................... 11
6.3 Media Distribution............................................................................................... 11
6.4 Signage................................................................................................................. 11
7. Assignment and Subletting............................................................................................. 11
7.1 Assignment........................................................................................................... 11
7.2 Permitted Assignments......................................................................................... 11
7.3 Other Project Agreements.................................................................................... 11
7.4 Contrary Assignments Void................................................................................. 12
Z5Fee Mortgages...................................................................................................... 12
7.6 Permitted Subleases............................................................................................. 12
8. Insurance......................................................................................................................... 12
8.1 Required Insurance.............................................................................................. 12
8.2 General Provisions for Tenant's Insurance....................................................... 12
8.3 Adjustment............................................................................................................ 13
8.4 Required Insurance Policy Clause...................................................................... 13
8.5 Blanket or Umbrella Policies............................................................................... 13
H
8.6 Delivery of Evidence of Insurance...................................................................... 13
9. Damage or Destruction; Condemnation....................................................................... 14
9.1 Damage;Repair Obligation................................................................................. 14
9.2 Insurance Proceeds.............................................................................................. 15
9.3 Condemnation...................................................................................................... 16
9.4 Condemnation Award.......................................................................................... 17
9.5 Prompt Notice....................................................................................................... 18
9.6 Survival................................................................................................................. 18
10. Representations,Warranties and Covenants............................................................... 19
10.1 Representations and Warranties of Tenant........................................................ 19
10.2 Representations and Warranties of the City....................................................... 19
10.3 "As Is'; No Representations or Warranties;Hazardous Materials.................. 20
10.4 Mutual Covenants................................................................................................ 20
11. Default and Remedies.....................................................................................................21
11.1 Tenant Default..................................................................................................... 21
11.2 City's Remedies.................................................................................................... 21
11.3 City Default..........................................................................................................22
11.4 Tenant's Remedies............................................................................................... 22
11.5 Waiver................................................................................................................... 23
12. Title; Surrender..............................................................................................................23
12.1 Title....................................................................................................................... 23
12.2 Surrender.............................................................................................................. 23
13. Indemnification...............................................................................................................24
13.1 Tenant................................................................................................................... 24
13.2 The City................................................................................................................ 24
14. Covenant of Quiet Enjoyment.......................................................................................24
15. Estoppel Certificate; Memorandum of Agreement.....................................................25
15.1 Estoppel Certificate.............................................................................................. 25
15.2 Memorandum of Agreement................................................................................ 25
16. Leasehold Mortgages......................................................................................................25
16.1 Right to Obtain Leasehold Mortgages................................................................ 25
16.2 Effect of a Leasehold Mortgage.......................................................................... 26
16.3 Foreclosure; Further Assignment....................................................................... 26
16.4 Notice of Leasehold Mortgages...........................................................................27
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16.5 Modifications Required by Leasehold Mortgagee.............................................. 27
16.6 Further Assurances.............................................................................................. 27
16.7 Protection of Leasehold Mortgagees................................................................... 28
16.8 First Leasehold Mortgagee's Right to a New Agreement.................................. 32
16.9 Priority of Leasehold Mortgages......................................................................... 34
16.10 Liability of Leasehold Mortgagee........................................................................ 34
16.11 Casualty and Condemnation Proceeds................................................................ 35
16.12 Mezzanine Lenders as Leasehold Mortgagees.................................................... 35
17. Purchase Option..............................................................................................................35
17.1 Purchase Option................................................................................................... 35
17.2 Exercise................................................................................................................ 35
17.3 Option Purchase Price......................................................................................... 36
17.4 Closing.................................................................................................................. 36
17.5 Survival/Forfeiture............................................................................................... 36
18. Miscellaneous...................................................................................................................36
18.1 Notices.................................................................................................................. 36
18.2 Force Majeure...................................................................................................... 37
18.3 Severability........................................................................................................... 37
18.4 Obligations of the Parties.................................................................................... 37
18.5 Time of the Essence.............................................................................................37
18.6 Binding Effect...................................................................................................... 37
18.7 Waiver................................................................................................................... 38
18.8 Interpretation....................................................................................................... 38
18.9 Integration and Modification..............................................................................38
18.10 Relationship of the Parties...................................................................................38
18.11 Third-Party Beneficiaries.................................................................................... 38
18.12 Attorneys'Fees..................................................................................................... 38
18.13 Counterparts.........................................................................................................38
18.14 Governing Law.....................................................................................................38
18.15 Payments.,......o...o.........o.....o-...........oo-..............-...o...............o..........o........-....o39
18.16 Interest.,....-oo...o-....o......-........oo..........o......o........o-...oo...o.......o...o......o...............39
18.17 Survival,.....oo.....o..............o.................o...oo.....-......o.....oo-........o.-o-o..........o........... 39
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LIST OF EXHIBITS
EXHIBIT A Description of Land
EXHIBIT B Description of Convention Center Parcel
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CONVENTION CENTER OPERATING LEASE
This CONVENTION CENTER OPERATING LEASE (this "Agreement") is made and
entered into as of (the "Effective Date"), between CITY OF ROUND
ROCK, TEXAS, a Texas local government home rule corporation (the "City"), and KR CC,
INC., a Delaware corporation ("Tenant"). The City and Tenant are sometimes referred to in this
Agreement as the "Parties" and each as a"Party".
RECITALS
A. The City, Tenant and Tenant's affiliate, KR Acquisitions, LLC, a Delaware
limited liability company ("KR Acquisitions") are a party to (i) that certain Master
Development Agreement dated as of December 15, 2016 (the "Master Development
Agreement"), pursuant to which (a) KR Acquisitions has agreed to design, develop and
construct a mixed-use project, including a hotel, and indoor water park, including improvements
and facilities ancillary to such uses (together with the Convention Center, the "Project"), to be
located on approximately 9.518 acres of land located east of Kenney Fort Blvd. and south of the
Union Pacific Railroad in the City of Round Rock, Texas, as further described in Exhibit A
attached hereto (the "Land"), and (b) City is agreeing to provide funding for certain components
of the Project and to fund and construct certain public infrastructure improvements in connection
with the Project (as provided in the Master Development Agreement), (ii) a Ground Lease
Agreement dated as of December 20, 2016 by and between Tenant and the City, as amended by
that certain First Amendment to Ground Lease Agreement dated February 1, 2017 (collectively,
the "Ground Lease"), and (iii)this Agreement (collectively, the "Project Agreements").
B. Pursuant to the terms of the Master Development Agreement, City will construct
a convention center building and improvements on the "Convention Center Parcel" created as a
separate parcel of land as Lot 2, Block "C" Final Plat of Kalahari Resort and Replat of Bertil
Telander Subdivision, as described and depicted on Exhibit B attached hereto (the "Convention
Center Parcel"), and which convention center building and improvements will consist of
convention, exhibition, and meeting space (the "Convention Center").
C. As stated in the Master Development Agreement, Section 351.102(b) Texas Tax
Code, and the Private Letter Ruling for the Project, the Convention Center must be owned by the
City. KR Acquisitions will cause the construction of the Convention Center pursuant to the terms
and conditions set forth in the Master Development Agreement.
D. The Parties desire to enter into this Agreement, pursuant to which City leases to
Tenant, and Tenant leases from the City, the Convention Center and the Convention Center
Parcel during the Leasehold Term (as defined below), on the terms and conditions set forth in
this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of their mutual promises herein contained, and for
other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby
acknowledged, the Parties, each intending to be legally bound, do hereby agree as follows:
1. Definitions. As used in this Agreement, capitalized terms shall have the meanings
indicated below unless a different meaning is expressed herein.
"Affiliate" of a specified Person means a Person who is directly or indirectly controlling,
controlled by, or under common control with, the specified Person, where "control"
means the possession of the power to direct the management and policies of the specified
Person.
"Agreement" is defined in the introductory paragraph of this Agreement.
"Applicable Law" means any law, statute, ordinance, rule, regulation, order,
determination or requirement of any Governmental Authority.
"Assignment" means any sale, transfer, assignment, pledge, mortgage, encumbrance or
any other transfer, including transfers as security for obligations, of this Agreement or a
Party's rights or obligations under this Agreement.
"Bankruptcy Proceeding" means any bankruptcy, insolvency, reorganization,
composition or similar proceeding under the United States Bankruptcy Code or any
similar state or federal statute for the relief of debtors.
"Business Day" means any day other than a Saturday, Sunday or other day on which
commercial banks in Austin, Texas are authorized or required by Applicable Law to
close. The use of the word"day," instead of"Business Day,"means a calendar day.
"City" is defined in the introductory paragraph of this Agreement.
"City Financing" means any financings by the City to fund the City Commitment (as
defined in the Master Development Agreement) and any refinancings of the foregoing.
"Condemnation Action" means a taking by any Governmental Authority (or other
Person with power of eminent domain) by exercise of any right of eminent domain.
"Condemnation Award" means all sums, amounts or other compensation for the
Convention Center payable to the Tenant or City, as applicable, as a result of, or in
connection with, any Condemnation Action.
"Control of the Convention Center" is defined in Section 16.7(I).
"Convention Center" is defined in Recital C.
"Convention Center Parcel" is defined in Recital C.
"County" means Williamson County, Texas.
"Default Rate" means an annual interest rate equal to the Interest Rate plus two percent
(2%).
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"Depository" means the First Leasehold Mortgagee or an independent third-party
financial institution, having at least one hundred million dollars ($100,000,000) in assets,
mutually approved by Tenant,the City and the First Leasehold Mortgagee.
"Effective Date" is defined in the introductory paragraph of this Agreement.
"Emergency" means any condition or situation that presents an imminent and significant
threat (or if not immediately acted upon will present an imminent and significant threat)
to the health or safety of users of the Convention Center or to the structural integrity of
the Convention Center or any portion thereof.
"Enforcement Action" means, with respect to any Leasehold Mortgage and Leasehold
Mortgagee, the occurrence of any of the following events: (A) any judicial or
non judicial foreclosure proceeding, the exercise of any power of sale, the taking of a
deed or assignment in lieu of foreclosure, the appointment of a receiver, or the taking of
any other enforcement action against the Leasehold Estate or any portion thereof or
Tenant, including the taking of possession or control of the Leasehold Estate or any
portion thereof, (B) any acceleration of, or demand or action taken in order to collect, all
or any indebtedness secured by all or any portion of the Leasehold Estate (other than
giving of notices of default and statements of overdue amounts), (C) any exercise of any
right or remedy available to Leasehold Mortgagee under any and all loan documents
evidencing the debt secured by the Leasehold Estate (collectively, the "Leasehold Loan
Documents"), at law, in equity, or otherwise with respect to Tenant or any portion of the
Leasehold Estate, other than the giving of notices of default and statements of overdue
amounts or (D) any active negotiation (including the exchange of written correspondence
regarding the same and the scheduling and subsequent attending of negotiations, whether
in person or via telephone) between Tenant and Leasehold Mortgagee with respect to a
workout following any default by Tenant under the terms and conditions of the Leasehold
Loan Documents; provided, however, that any Enforcement Action shall be deemed to
continue for a period of one hundred twenty(120) days following final non-appealable
judgment of a court of competent jurisdiction or cessation of any of the events or
activities identified in subclauses (A)through (D) above.
"Environmental Law" means any Applicable Law, including requirements under
permits, licenses, consents and approvals of any Governmental Agency, relating to
pollution or protection of human health or the environment, including those that relate to
emissions, discharges, releases or threatened releases, or the generation, manufacturing,
processing, distribution, use, treatment, storage, disposal, transport, or handling of
Hazardous Materials.
``Events" means all convention, exhibition, business, travel, leisure, educational, sports,
recreational, entertainment, cultural, civic, and any other activities and events conducted
at the Convention Center or upon the Convention Center Parcel, including, without
limitation, conventions, trade shows, exhibitions, markets, fairs, meetings and community
or civic oriented events, exhibitions and tournaments, concerts and other musical
performances, theater performances, family shows, other forms of live entertainment,
award shows, charitable events, and private parties.
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"Expiration Date" means 11:59 p.m. on December 19, 2115.
"Fee Estate" means the City's fee title in the Land and/or the Convention Center Parcel,
as applicable.
"First Leasehold Mortgagee" means the holder of the Leasehold Mortgage constituting
a first lien on the Leasehold Estate.
"Force Majeure Event" is defined in Section 18.3.
"Foreclosure Event" means a foreclosure, trustee's sale, deed, transfer, assignment or
other conveyance in lieu of foreclosure, or other similar exercise of rights or remedies
under any Leasehold Mortgage, including the occurrence of any transfer of title to the
mortgaged estate by operation of or pursuant to any Bankruptcy Proceeding, in each case
whether the transferee is a Leasehold Mortgagee, a party claiming through a Leasehold
Mortgagee or a third party.
"Governmental Authority" means any federal, state or local entity, political
subdivision, agency, department, commission, board, bureau, administrative or regulatory
body or other instrumentality having jurisdiction over the Convention Center or the
Parties.
"Hazardous Materials" means those materials that are regulated by, or form the basis of
liability under, any Environmental Law, including, but not limited to, polychlorinated
biphenyls (PCBs), petroleum (including oil, motor oil and gasoline), natural gas (and
synthetic gas usable for fuel), asbestos and asbestos containing materials (ACMs),
underground storage tanks (USTs), above-ground storage tanks (ASTs), as well as
substances, materials or conditions now or in the future defined as "hazardous
substances", "pollutants" or "contaminants" in the Comprehensive Environmental
Response Compensation and Liability Act (42 U.S.C. Section 9601, et seq.), those
substances, materials or conditions now or in the future defined as "hazardous waste" in
any applicable Environmental Law and any other substance, material or condition that is
now or in the future considered hazardous or otherwise subject to any statutory or
regulatory requirement governing handling, disposal and/or clean up.
"Improvements" means all improvements, buildings, fixtures and structures related to
the Convention Center and constructed on or part of the Convention Center Parcel.
"Interest Rate" means the interest rate charged by the City for its then most recent
issuance of indebtedness. All interest to be paid pursuant to this Agreement shall be
computed on the basis of a 360-day year consisting of twelve (12) months of thirty (30)
days each.
"Land" is defined in Recital B.
``Lease Impairment" means any (A) cancellation, rejection surrender(whether voluntary
or otherwise) or termination of this Agreement, including upon a casualty or
condemnation affecting the Convention Center or the Convention Center Parcel,
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(B) consent, or affirmative acquiescence, by Tenant to a sale of any property, or interest
in any property, under 11 U.S.C. § 363 or otherwise in any Bankruptcy Proceeding by the
City, (C) exercise of any right of Tenant to treat this Agreement as terminated under
11 U.S.C. § 365(h)(1)(A)(i) or any comparable provision of law or (D) subordination of
this Agreement or the Leasehold Estate to any other estate or interest in the Convention
Center or the Convention Center Parcel.
"Leased Premises" means the Convention Center and Convention Center Parcel,
together with all of City's right, title and interest, if any, in and to all rights, privileges
and easements appurtenant to the Convention Center Parcel now existing or created
during the Term of this Agreement.
"Leasehold Estate" means Tenant's leasehold and subleasehold estate and all other
rights, titles and interests of Tenant arising under this Agreement.
"Leasehold Mortgage" means a mortgage, deed of trust, security deed, deed to secure
debt or any similar other instrument or agreement constituting a lien upon, or similarly
encumbering, the Leasehold Estate held by a Leasehold Mortgagee, as renewed, restated,
modified, consolidated, amended, extended or assigned (absolutely or collaterally) from
time to time.
"Leasehold Mortgagee" means the holder of a Leasehold Mortgage (including any
trustee, servicer or administrative agent acting on behalf of the holder or holders of a
Leasehold Mortgage).
"Leasehold Term" is defined in Section 2.3(B).
"Liabilities" is defined in Section 13.1.
"Mezzanine Financing" is defined in Section 16.12.
"Mezzanine Lender" is defined in Section 16.12.
"Minimum Property Insurance Coverage" is defined in Section 8.1(A).
"Mortgagee's Cure" is defined in Section 16.7(E).
"Mortgagee's Cure Rights" is defined in Section 16.7(E).
,'New Agreement" is defined in Section 16.8.
"New Agreement Delivery Date" is defined in Section 16.8(A).
"New Operator" means a Person, including, without limitation, Leasehold Mortgagee or
its assignee, nominee or designee, that (A) acquires the Leasehold Estate through a
Foreclosure Event or(B) enters into a New Agreement with the City under Section 16.8.
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"Operations Standard" means a level of operation that (A) is in a manner to provide a
first-class attendee experience for Events that includes high standards of cleanliness in
Convention Center facilities, and (B) complies with Applicable Law.
"Option Purchase Price" is defined in Section 17.3.
"Party" or"Parties" is defined in the introductory paragraph of this Agreement.
"Person" means any individual, trust, estate, partnership, joint venture, company,
corporation, association, limited liability company, or other legal entity, business
organization or enterprise.
"Personal Default" means any nonmonetary default under this Agreement that is not
susceptible to cure by a Leasehold Mortgagee.
"Project" is defined in Recital B.
"Purchase Option" is defined in Section 17.1.
6'State" means the State of Texas.
"Substantial Completion Date" means the date on which the City issues to Tenant and
the City the certificate(s) of occupancy, which may be temporary, providing that the
Convention Center is ready for use and occupancy for its intended purposes in
accordance with Applicable Laws. The Parties shall document the Substantial
Completion Date in writing.
"Tax" means any general or special, ordinary or extraordinary, tax, imposition,
assessment, levy, usage fee, excise or similar charge (including any ad valorem or other
property taxes), however measured, regardless of the manner of imposition or
beneficiary, that is imposed by any Governmental Authority.
"Tenant's Cure Period Expiration Notice" is defined in Section 16.7(C).
"Term" is defined in Section 2.3(A).
"Trustee"means the trustee under the indenture for the City Financing.
2. Lease and Grant of Use; Reservation of Rights; Term
2.1 Lease and Grant of Use.
(A) Lease. Subject to the terms and conditions of this Agreement, City hereby
leases to Tenant, and Tenant hereby leases from City, the Convention
Center and Convention Center Parcel during the Leasehold Term. During
the Leasehold Term, Tenant is permitted hereunder to use the Convention
Center and the Convention Center Parcel for any and all uses that are
permitted by Applicable Law.
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(B) Compliance with Applicable Law. Tenant covenants and agrees that its
use and occupancy of the Convention Center and the Convention Center
Parcel shall comply in all material respects with Applicable Law. City
covenants and agrees that its performance of this Agreement shall comply
in all material respects with Applicable Law.
(C) Third Parties. Subject to the terms and conditions of this Agreement, any
of the rights or obligations granted to Tenant under this Agreement may be
exploited or satisfied directly by Tenant or indirectly through other
Persons (including Affiliates of Tenant).
(D) Subordination, Nondisturbance and Attornment. If requested by Tenant,
the City shall enter into a subordination, non-disturbance and attornment
agreement that shall provide, among other things, that the City agrees not
to disturb Tenant's, or any of its subtenants' or licensees', use of the
Convention Center Parcel and the Convention Center pursuant to the terms
and conditions of this Agreement.
(E) Easements and Other Appurtenant Rights. City and Tenant shall have the
easement and other appurtenant rights set forth in the Master Easement
Agreement of even date herewith and recorded with the recorder's office
of the County.
2.2 Reserved.
2.3 Term.
(A) Term: Generally. The term of this Agreement (the "Term") commences
on the Effective Date and expires on the Expiration Date, unless
terminated earlier as expressly provided for in this Agreement. The Term
includes the Leasehold Term.
(B) Leasehold Term. The term of the City's lease of the Convention Center
Parcel and the Convention Center to Tenant (the "Leasehold Term")
commences on the City's creation of the Convention Center Parcel and
expires on the Expiration Date, unless terminated earlier as expressly
provided for in this Agreement.
(C) Early Termination. If Final Completion of the Convention Center has not
been achieved by December 31, 2025, then Tenant shall have the right to
terminate this Agreement by written notice to the City, which termination
shall be effective on the date specified in such notice.
3. Intangible Rights
3.1 Grant of License. The City hereby grants to Tenant during the Term an
exclusive, irrevocable, royalty-free, paid-up right and license to use any replica,
model, artistic or photographic rendering or other visual representation of the
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Convention Center or any portion thereof owned by or licensed to the City in
association with any and all goods and services throughout the world, together
with the right to use, enjoy (whether in whole or in part) and sublicense the right
to receive and retain all revenues generated from Tenant's or its sublicensees' use
of such rights.
4. Rent
4.1 Rent. In consideration for Tenant's rights under this Agreement Tenant shall pay
to the City annual rent of$1.00 for each Operating Year(the "Annual Rent").
4.2 Timing of Payment. Rent for any Operating Year shall be paid on January 1 of
such Operating Year. The payment of Rent for the first Operating Year shall be
paid within ninety (90) days after the Substantial Completion Date, and thereafter
in accordance with the schedule set forth above.
5. Taxes; Operations; Capital Repairs; Recordkeeping
5.1 Tenant's Sole Cost. In consideration for Tenant's rights under this Agreement,
Tenant shall be responsible for paying, throughout the Leasehold Term after the
Substantial Completion Date, all costs necessary to manage and operate the
Convention Center in accordance with this Agreement, including all costs of
maintenance, repairs, replacements, renovation, remodeling, removal, alterations,
improvements and insurance with respect to the Convention Center and the
Convention Center Parcel.
5.2 Tax Matters.
(A) Without limiting the generality of Section 5.1 and in consideration for
Tenant's rights under this Agreement, except as provided in
Section 5.2(B), Tenant shall be solely responsible for, and shall pay and
discharge as and when due, all Taxes, to the extent allocable to the
Leasehold Term after the Substantial Completion Date, upon or with
respect to Tenant's possession, operation, management, maintenance,
alteration, repair, rebuilding, use or occupancy of, or employment of
personnel in,the Convention Center.
(B) The City shall not impose or assess, and shall cooperate with the efforts of
Tenant to prevent any other Governmental Authority from imposing or
assessing, any amusement, ticket, possessory, property or other Taxes
against Tenant with respect to the occupancy and/or use of the Convention
Center and the Convention Center Parcel.
(C) Tenant shall have the right, at its sole cost and expense, to contest the
amount, validity, or applicability, in whole or in part, of any Taxes
affecting, against, or attaching to the Convention Center or Convention
Center Parcel or any portion thereof by appropriate proceedings conducted
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in good faith and with due diligence, and City shall cooperate with Tenant
in such actions as reasonably necessary.
5.3 Operations and Management. Notwithstanding anything to the contrary in this
Agreement, the operations and management of the Convention Center shall be
performed by (x) Tenant or its Affiliate, (y) an unrelated third-party management
company engaged by Tenant or(z)a New Operator.
(A) Generally. Tenant shall (i) have the exclusive right to, and shall, operate
and manage the Convention Center on a 24-hour per day, year round basis
and (ii)operate and manage the Convention Center in accordance with,
and thus furnish janitorial, security and Event staffing sufficient to comply
with, the Operations Standard in all material respects. During the Term,
Tenant shall have the exclusive right to receive, allocate, use and
distribute, in its sole and absolute discretion, all revenues with respect to
the Convention Center, the Convention Center Parcel or any portion
thereof. Pricing for the foregoing shall be determined by Tenant or its
licensees.
(B) Permits. Tenant shall obtain and maintain all necessary licenses and
permits required in connection with the operation of the Convention
Center and the City shall use commercially reasonable efforts to expedite
the process by which Tenant so obtains and maintains such licenses and
permits that are to be obtained from the City or other Governmental
Authority.
(C) Utilities. Tenant shall be solely responsible for the costs related to the use
of sufficient water, sewer, natural gas, heat, air-conditioning, electric,
telephone, Internet and other utilities and hookups as are necessary to
operate the Convention Center.
(D) Maintenance and Repair. Tenant shall perform all maintenance and
repairs so as to maintain the Convention Center Parcel and the Convention
Center, including its fixtures, machinery, equipment, improvements and
other components, in accordance with the Operations Standards in all
material respects. For the avoidance of doubt, Tenant further
acknowledges and agrees that Tenant shall be solely responsible at
Tenant's own expense for maintaining and repairing the wastewater line
which extends from and serves the Convention Center, even if the City in
the future no longer owns the Convention Center.
(E) Security. Tenant shall be responsible for, and pay for all costs associated
with, maintaining and using reasonable efforts to ensure public order and
safety and security in and around the Convention Center in a manner that
is consistent with Operations Standards in all material respects.
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(F) Agreements. Tenant shall have the exclusive right to negotiate, execute
and perform, and to receive, allocate, use and distribute, in its sole
discretion, all revenues from, all use agreements, licenses and other
agreements (i)with Persons who desire to schedule Events and telecasts or
other transmissions in, from, or to the Convention Center (or any part
thereof) or who desire otherwise to license the use of or to occupy the
Convention Center(or any part thereof) or(ii)that otherwise pertain to the
use, operation and occupancy of the Convention Center or Convention
Center Parcel (or any part thereof), including with respect to the sale of
tickets for Events, the sale of food, beverages and merchandise, and other
commercial activities, at the Convention Center (including at restaurant
and retail facilities) or Convention Center Parcel.
(G) Additions and Capital Repairs. Tenant shall be solely responsible for, and
shall timely make with reasonable diligence, all additions and capital
repairs required to comply with Operations Standards in all material
respects. Tenant may also make, at its discretion, such other additions and
capital repairs as it believes are appropriate.
(H) Emergency and Repairs. In the event of any Emergency, Tenant shall
promptly notify the City and take such steps as are necessary to alleviate
the Emergency. If Tenant has not promptly made the repairs necessary to
alleviate such Emergency, the City may (but is not obligated to), in
addition to any other rights and remedies available to the City, make the
repairs necessary to alleviate such Emergency. To the extent practicable,
the City shall contact Tenant prior to the City taking any action pursuant
to this Section 5.3(H) to discuss the actions to be taken with respect to the
Emergency or such repairs and to attempt to avoid the duplication of
efforts by Tenant (and its Affiliates) and the City. Tenant shall, within
thirty(30) days after written demand from the City, reimburse the City for
all reasonable out-of-pocket costs and expenses incurred by the City to
make the repairs necessary to alleviate such Emergency.
6. Advertising; Media
6.1 Advertising.
(A) Tenant shall have the exclusive right to market, price, sell, grant, license,
post, exhibit, display, publish, broadcast, and present, and shall have the
exclusive right to receive, allocate, use and distribute, in its sole
discretion, all revenues from, all advertising, sponsorship and promotional
activity, signage, designations, messages and displays of every kind and
nature at or regarding the Convention Center and the Convention Center
Parcel, whether audio or visual and whether created in a medium now
existing or developed in the future.
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6.2 Naming Rights. Tenant shall have the exclusive right to sell, grant or license, and
shall have the exclusive right to receive, allocate, use and distribute, in its sole
discretion, all revenues from the naming of the Convention Center or any portion
thereof.
6.3 Media Distribution. Tenant shall have the exclusive right to control (and thus
sell, license or grant), and shall have the exclusive right to receive, allocate, use
and distribute, in its sole discretion, all revenues with respect to, all broadcasts,
reproductions and transmittals of the pictures, descriptions and accounts of all
Events, by any and all forms, means and modalities of distributing video, audio or
audio-video programming, whether distributed locally, nationally, internationally
or otherwise.
6.4 Signage. The Parties agree to cooperate in good faith to have third parties install,
at no cost to Tenant, a sufficient number of signs containing the Convention
Center name on roadways and at bus stops, streetcar and fixed rail transit
locations and other public locations within the City to direct individuals to the
Convention Center.
7. Assignment and Subletting
7.1 Assignment. Subject to Section 7.2, neither Party shall make or enter into an
Assignment of this Agreement without the prior written consent of the other
Party. In connection with any Assignment of this Agreement by a Party (whether
or not the other Party's consent is required therefor but excluding an assignment
of this Agreement by Tenant to an Affiliate), the assigning Party shall provide the
other Party with notice of such Assignment and all information reasonably
requested by the other Party that relates to the ability of the assignee to satisfy the
obligations of the assigning Party under this Agreement and, if such Assignment
satisfies one of the conditions set forth in Section 7.2, all information reasonably
requested by the other Party to confirm that such condition has been satisfied.
7.2 Permitted Assignments. Subject to Section 7.3, the following Assignments shall
be permitted by Tenant without the consent of the other Party:
(A) Tenant may make an Assignment of this Agreement and/or the Purchase
Option to any Affiliate of Tenant;
(B) Tenant may delegate its rights or obligations hereunder with respect to the
Convention Center in accordance with Section 2.1(C); and
(C) Subject to Section 16, Tenant may pledge, mortgage, grant a security
interest in, encumber, or collaterally assign its interest in this Agreement
or the equity interests in Tenant to secure indebtedness for borrowed
money of Tenant.
7.3 Reserved.]
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7.4 Contrary Assignments Void. Any Assignment of this Agreement made contrary
to this Section 7 is void.
7.5 Fee Mortgages. The City shall not mortgage or otherwise encumber the City's
Fee Estate or Convention Center Parcel with any mortgage, deed of trust, security
deed, deed to secure debt, or any other similar instrument or agreement
constituting a lien upon, or similarly encumbering, the Fee Estate or Convention
Center Parcel.
7.6 Permitted Subleases. Tenant may enter into subleases, licenses, concession or
other occupancy agreements, but it shall not enter into any agreement (including
those contemplated by Sections 2.1(C) and 5.3(F)) that circumvents the
restrictions on Assignments set forth in this Section 7.
8. Insurance
8.1 Required Insurance. At Tenant's sole expense and as mutually determined by
the City and Tenant, either the City or Tenant shall procure and maintain (or
cause to be procured and maintained by appropriate contractors or vendors) at
least the following insurance coverages:
(A) Property insurance for the Convention Center covering real property and
personal property for all risks of physical loss or damage written on the
Standard All Risk Property Form in an amount not less than the Minimum
Property Insurance Coverage with no coinsurance penalty provisions.
"Minimum Property Insurance Coverage" means, at any given time,
100% of the full replacement cost (new without deduction for
depreciation) of the Convention Center. The policy shall provide
coverage for "all risks" of direct physical loss, including the perils of
earthquake, earth movement, flood, and certified and non-certified acts of
terrorism.
(B) Commercial general liability insurance (CGL) written on an "occurrence"
policy form and covering liability for death, bodily injury, personal injury,
and property damage with limits of not less than $10,000,000.00 per
occurrence relating, directly or indirectly, to Tenant's business operations,
conduct or use or occupancy of the Convention Center. Such coverage
shall include all activities and operations conducted by any Person on or
about the Convention Center or Convention Center Parcel, and any work
performed by or on behalf of Tenant at the Convention Center.
8.2 General Provisions for Tenant's Insurance.
(A) All insurance policies required under Section 8.1 (including endorsements
thereto) shall, unless otherwise expressly agreed by the City in writing, be
issued by insurance companies authorized to do business in the State of
Texas and rated "A-VIII" or better by A.M. Best Company (or
equivalent).
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(B) The CGL policy required under Section 8.1(B) shall be endorsed to name
the City, each Leasehold Mortgagee and their respective officers, officials,
employees and agents as additional insureds with respect to liability
arising out of work or operations performed by or on behalf of Tenant and
its vendors, agents, representatives and employees. For any claims related
to the Convention Center, the CGL policy shall be primary insurance with
respect to the City, each Leasehold Mortgagee and their respective
officers, officials, employees and agents.
(C) All policies for property insurance required under this Agreement shall
name Tenant, the City, each Leasehold Mortgagee and such other Persons
who have an insurable interest in the Convention Center as "loss payees"
to the extent of their insurable interest in the Convention Center.
(D) Tenant shall require its insurers to waive rights of subrogation against the
City, each Leasehold Mortgagee and their respective officers, officials,
employees and agents which any insurer of Tenant may acquire by virtue
of the payment of any loss.
8.3 Adjustment. The coverages, policy limits and deductibles described in this
Section 8 may at the City's written request, be reviewed every five (5) years after
the Substantial Completion Date and may be adjusted if prudent (as mutually
agreed upon by the City and Tenant), considering levels of inflation, risk of loss,
premium expenses and other relevant factors, including the then practice of other
prudent property owners in the vicinity of the Convention Center; provided,
however, that the amount of property damage insurance shall never be less than
the Minimum Property Insurance Coverage.
8.4 Required Insurance Policy Clause. Each policy of insurance required to be
carried pursuant to the provisions of this Section 8 shall contain an agreement by
the insurer that such policy shall not be canceled, modified or denied renewal
without at least sixty (60) days' prior written notice to each Party and all other
named or additional insureds, including each Leasehold Mortgagee.
8.5 Blanket or Umbrella Policies. The insurance required to be carried by Tenant
pursuant to the provisions of this Section 8 may, at Tenant's option, be effected
by blanket or umbrella policies issued to Tenant covering the Convention Center
and other properties owned or leased by Tenant or Affiliates thereof, provided
such policies otherwise comply with the provisions of this Agreement and provide
to the Convention Center not less than the specified coverage, including the
specified coverage for all insureds required to be named as insureds under this
Agreement.
8.6 Delivery of Evidence of Insurance. With respect to each insurance policy
required to be procured or maintained under the terms of this Agreement, Tenant
shall deliver to the City and each Leasehold Mortgagee evidence showing that
such insurance (including any endorsements required by this Agreement) is in full
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force and effect. Such evidence shall include certificates of insurance issued by a
responsible officer of the issuer of such policies, or in the alternative, a
responsible officer of an agent authorized to bind the named issuer, setting forth
the name of the issuing company, the coverage, limits, deductibles and the term
thereon.
9. Damage or Destruction; Condemnation
9.1 Damage;Repair Obligation.
(A) In the event of damage to, or destruction of, the Convention Center, this
Agreement shall remain in full force and effect and Tenant shall repair and
restore the Convention Center as soon as possible after the date of the
damage or destruction. In furtherance of the foregoing, the City
acknowledges and agrees that in addition to complying with the
requirement herein to repair and restore the Convention Center, Tenant
may desire changes to the Convention Center as originally constructed to
upgrade the guest experience at, and/or the level of design of, the
Convention Center, and the City agrees to cooperate in approving such
changes and as to such repairs and restoration of the Convention Center.
(B) Notwithstanding anything contained in Section 9.1(A), if the Convention
Center is damaged or destroyed (i) during the last five (5) years of the
Leasehold Term then in effect, and (ii) it is reasonably projected to take
longer than twelve (12) months from the date of the damage or destruction
to repair and restore the Convention Center, then Tenant shall have the
right, subject to the rights of any Leasehold Mortgagee pursuant to
Section 16, to terminate this Agreement by delivering written notice to the
City within ninety (90) days after the determination that the repair and
restoration of the Convention Center will take longer than twelve (12)
months.
(C) Notwithstanding anything contained in Section 9.1(A), if any portion of
the Convention Center is damaged or destroyed at any time and the total
cost to repair and restore the Convention Center exceeds the sum of(i)the
insurance proceeds actually received by Tenant on account of the damage
or destruction, plus (ii) any applicable deductible or self-retention
amount, then Tenant shall have the right, subject to the rights of any
Leasehold Mortgagee pursuant to Section 16, to terminate this Agreement
by delivering written notice to the City within ninety(90) days after the
determination that the forgoing conditions to such termination have
occurred. Notwithstanding the foregoing, the City may, by written notice
delivered to Tenant no later than thirty(30) days following Tenant's
election to terminate this Agreement pursuant to this Section 8.1(C), elect
to pay the amount by which the total cost to repair and restore the
Convention Center exceeds the amounts set forth in clauses (i) and
(ii) above. If the City makes such an election and provides such excess
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funds in a manner satisfactory to Tenant and its lenders (in their
reasonable discretion), then this Agreement will not terminate and Tenant
shall repair and restore the Improvements pursuant to Section 9.1(A) at
Tenant's cost, provided that (x)the City will be responsible for paying the
excess amounts as described in the preceding sentence and
(y) notwithstanding anything to the contrary contained in Section 9.1(A)
or the Master Development Agreement, the City shall have the right to
review and approve all plans and specifications for such repair and
restoration, and all changes thereto, which approval shall not be
unreasonably withheld, conditioned or delayed. In addition, if Tenant is
prohibited from repairing the Convention Center due to a final and
non-appealable judgment by a court or due to Applicable Law, then
Tenant shall have the right, subject to the rights of any Leasehold
Mortgagee,to terminate this Agreement upon written notice to the City.
(D) If Tenant terminates this Agreement pursuant to Section 9.1(B) or
9.1(C) any such termination shall be without penalty to Tenant, including
without loss of any rights by Tenant under Section 17. If Tenant does not
exercise the Purchase Option following any such termination pursuant to
Section 9.1(B) or 9.1(C), the City may, by written notice delivered to
Tenant no later than thirty (30) days following the expiration of the
Purchase Option, require Tenant, at Tenant's sole expense, to tear down
and remove, prior to the termination of this Agreement, all portions of the
Convention Center that were damaged or destroyed, including the debris
resulting therefrom, and to otherwise clean and restore the area affected by
such casualty to a level and clean condition; provided, however, Tenant
shall not be obligated to incur any expenses in connection with such
demolition and debris removal in excess of the amount of insurance
proceeds that are available therefor (except to the extent insurance
proceeds are unavailable because (x) Tenant failed to satisfy the insurance
requirements of Section 8 to the extent commercially available and not
approved by the City or (y) if insurance does not pay out insurance
proceeds because the damage or destruction resulted from the gross
negligence or willful misconduct of Tenant).
9.2 Insurance Proceeds. Any insurance proceeds paid under any property insurance
for the Convention Center required to be maintained pursuant to Section 8 as a
result of damage or destruction of the Convention Center shall be deposited with
the Depository, to act as escrow agent. The funds held in escrow shall be
administered and disbursed pursuant to the terms of a commercially reasonable
escrow agreement, mutually acceptable to the Parties, the Trustee and the First
Leasehold Mortgagee, which escrow agreement shall provide for the allocation
and distribution of such proceeds as follows:
(A) Agreement Terminated. If this Agreement is terminated pursuant to the
provisions of Section 9.1
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(1) First, (i) seventy-five percent (75%) to City to pay the outstanding
amount of the City Financing and (ii) twenty-five percent (25%) to
the Leasehold Mortgagees to pay the aggregate outstanding
amounts of the Leasehold Mortgages and the Mezzanine
Financing, respectively, which 75/25" distributions shall continue
until the earlier to occur of (x) the full repayment of the
outstanding amount of the City Financing or(y) the full repayment
of the aggregate outstanding amounts of the Leasehold Mortgages
(provided, the City and Tenant agree to mutually determine the
applicable distribution in accordance with the ratio of the City
Financing to the total cost of construction for the Convention
Center); then
(2) Second, one hundred percent (100%) to the full repayment of (i)
the outstanding amount of the City Financing or (ii) the Leasehold
Mortgagees, until the full repayment of the aggregate outstanding
amounts of the Leasehold Mortgages; then
(3) Third, the remainder to Tenant (subject to the rights of Leasehold
Mortgagee under any Leasehold Mortgage).
(B) Agreement Not Terminated. If this Agreement is not terminated pursuant
to the provisions of Section 9.1, then: (i) first, to pay for costs to repair or
restore the Improvements pursuant to the provisions of Section 9.1 and
(ii) second, the remainder to Tenant (subject to the rights of Leasehold
Mortgagee under any Leasehold Mortgage).
9.3 Condemnation.
(A) Total Condemnation. In the event of any Condemnation Action, other
than a temporary taking, that prevents the use or occupancy of any portion
of the Convention Center or Convention Center Parcel necessary for the
location or use of the Convention Center or facilities or amenities
necessary or convenient for the Convention Center (including access to
and from the Convention Center), then, subject to Tenant's rights under
Section 17 (which survive the termination of this Agreement) and the
rights of any Leasehold Mortgagee under Section 16, Tenant shall have
the right to terminate this Agreement by delivering written notice to the
City within ninety(90) days after the Condemnation Action becomes final
and non-appealable. If this Agreement is so terminated, any such
termination shall be without penalty to Tenant or the City.
(B) Partial Condemnation. If Tenant does not have a right to terminate this
Agreement as a result of a Condemnation Action or elects not to do so,
Tenant will use commercially reasonable efforts to, at no cost to City, as
promptly as practicable and in any event within twelve (12) months after
such Condemnation Action, repair and restore any damage to the
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Convention Center resulting from such Condemnation Action (which time
shall be extended by such reasonable time as is commensurate with any
reasonable delays due to Force Majeure Events, adjustment or recovery of
insurance, preparation of plans and specifications, bidding of contracts and
obtaining the necessary approvals from the City and other Persons).
(C) Proceedings. To the maximum extent permitted by Applicable Law,
Tenant and the City each shall have the right, at its own expense, to appear
in any Condemnation Action and to participate in any and all hearings,
trials, and appeals relating thereto even if this Agreement has been
terminated. The Leasehold Mortgagee shall also be entitled to appear and
participate in any Condemnation Action and in any and all hearings, trials
and appeals relating thereto even if this Agreement has been terminated.
Neither Party shall settle or compromise any right of the other Party to
receive a Condemnation Award without the prior written consent of the
other Party and, with respect to Tenant's rights, the prior written consent
of each Leasehold Mortgagee. Subject to the other provisions of this
Section 9.3, in any Condemnation Action, Tenant shall have the right to
assert a claim for any Condemnation Awards for the value of the
Improvements or related facilities or amenities. Tenant and the City shall
each have the right to assert a claim for any Condemnation Awards for
(x)the loss in value of its rights under this Agreement as if this Agreement
had not terminated, and (y) any other damages to which the City or
Tenant, as applicable, may be entitled under Applicable Law.
9.4 Condemnation Award. Any Condemnation Awards shall be deposited with the
Depository, to act as escrow agent. The funds held in escrow shall be
administered and disbursed pursuant to the terms of a commercially reasonable
escrow agreement, mutually acceptable to the Parties, the Trustee and the First
Leasehold Mortgagee, which escrow agreement shall provide for the allocation
and distribution of such Condemnation Awards as follows (notwithstanding any
allocations of the Condemnation Awards made by the applicable Governmental
Authority):
(A) If this Agreement is terminated pursuant to the provisions of Section 9.3:
(1) If the Condemnation Award is paid prior to there being any
amount outstanding under the City Financing or is due to
Condemnation Action by the City or an agency or authority of
City, then, (i) first, one hundred percent (100%) to pay the
aggregate outstanding amounts of the Leasehold Mortgages, until
the full repayment of the aggregate outstanding amounts of the
Leasehold Mortgages, and (ii) second, the remainder to the Tenant;
or
(2) If the Condemnation Award is paid after any amounts are
outstanding under the City Financing and is not due to
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Condemnation Action by the City or an agency or authority of
City, then:
(a) First, (i) seventy-five percent (75%) to City to pay the
outstanding amount of the City Financing and (ii) twenty-
five percent (25%) to the Leasehold Mortgagees to pay the
aggregate outstanding amounts of the Leasehold Mortgages
and the Mezzanine Financing, respectively, which "75/25"
distributions shall continue until the earlier to occur of(x)
the full repayment of the outstanding amount of the City
Financing or (y) the full repayment of the aggregate
outstanding amounts of the Leasehold Mortgages
(provided, the City and Tenant agree to mutually determine
the applicable distribution in accordance with the ratio of
the City Financing to the total cost of construction for the
Convention Center);
(b) Second, one hundred percent (100%) to the full repayment
of(i) the outstanding amount of the City Financing or (ii)
the Leasehold Mortgagees, until the full repayment of the
aggregate outstanding amounts of the Leasehold
Mortgages; then
(c) Third, the remainder to Tenant (subject to the rights of
Leasehold Mortgagee under any Leasehold Mortgage).
(B) Agreement Not Terminated. If this Agreement is not terminated pursuant
to the provisions of Section 9.3, then: first, to pay for costs to repair and
restore the Convention Center pursuant to the provisions of Section 9.3.
Thereafter, (a) if the Condemnation Award is not due to the Condemnation
Action by the City or any agency or authority thereof, to the Parties
pursuant to any allocations of the Condemnation Awards between the
Parties made by the applicable Governmental Authority and (b) otherwise,
to Tenant.
9.5 Prompt Notice. If either Party becomes aware of any material damage or
destruction of the Convention Center Parcel or the Convention Center, or any
actual, contemplated, or threatened Condemnation Action, then such Party shall
promptly notify the other Party and the Leasehold Mortgagee.
9.6 Survival. This Section 9 survives the expiration or earlier termination of this
Agreement, but only insofar as such provisions relate to any damage or
destruction of the Convention Center (or insurance proceeds therefrom) or
Condemnation Action (or Condemnation Award therefrom) that arose prior to the
expiration or earlier termination of this Agreement.
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10. Representations, Warranties and Covenants
10.1 Representations and Warranties of Tenant. Tenant represents and warrants to
the City that, as of the Effective Date:
(A) Organization. Tenant is a corporation duly organized and validly existing
under the laws of the State of Delaware. Tenant has all requisite limited
liability company power and authority to enter into this Agreement.
(B) Authorization; No Violation. The execution, delivery and performance by
Tenant of this Agreement have been duly authorized by all necessary
action, will not violate the organizational documents of Tenant and will
not result in the breach of, or constitute a default under, any material
agreement or any judgment or decree to which Tenant is a party or by
which Tenant or its material assets are bound. This Agreement has been
duly executed and delivered by Tenant and constitutes valid and binding
obligations of Tenant.
(C) Litigation. No suit is pending or, to the knowledge of Tenant, threatened
against Tenant that could reasonably be expected to have a material
adverse effect upon Tenant's performance under this Agreement.
(D) No Broker's Fees or Commissions. Tenant has not incurred or created any
liabilities or claims for broker's commissions or finder's fees in
connection with the negotiation, execution or delivery of this Agreement.
10.2 Representations and Warranties of the City. The City represents and warrants to
Tenant that, as of the Effective Date:
(A) Organization. The City is a local government home rule corporation of
the State of Texas. The City has all requisite power and authority to enter
into this Agreement.
(B) Authorization; No Violation. The execution, delivery and performance by
the City of this Agreement have been duly authorized by all necessary
action, will not violate the organizational documents of the City and will
not result in the breach of, or constitute a default under, any material
agreement or any judgment or decree to which the City is a party or by
which the City or its material assets are bound. This Agreement has been
duly executed and delivered by the City and constitutes valid and binding
obligations of the City.
(C) Litigation. No suit is pending or, to the knowledge of the City, threatened
against the City that could reasonably be expected to have a material
adverse effect upon the City's performance under this Agreement, the
Convention Center Parcel or the Convention Center.
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(D) No Broker's Fees or Commissions. The City has not incurred or created
any liabilities or claims for broker's commissions or finder's fees in
connection with the negotiation, execution, or delivery of this Agreement.
(E) No Restrictions. Use of the Convention Center Parcel for the Convention
Center as contemplated by this Agreement is permitted under, and the
City's execution, delivery and performance of this Agreement do not
violate any Applicable Laws.
10.3 "As Is" No Representations or Warranties; Hazardous Materials. Except as
expressly set forth herein, it is understood and agreed that the Convention Center
Parcel and the Convention Center will be leased and, if applicable, conveyed "as
is" with any and all faults and latent and patent defects without any express or
implied representation or warranty by the City. Except as expressly set forth in
this Agreement, the City has not made and does not hereby make and specifically
disclaims any representations or warranties of any kind or character whatsoever,
express or implied, with respect to the condition of the Convention Center Parcel
and the Convention Center (including their suitability or fitness for any particular
purpose or their compliance with Environmental Laws or other Applicable Laws),
and the City hereby disclaims and renounces any such representation or warranty
not expressly set forth in this Agreement. Tenant acknowledges and agrees that it
is entering into this Agreement without relying upon any such representation or
warranty not expressly set forth in this Agreement, oral or written, made by the
City or any representative of the City or any other Person acting or purporting to
act on the behalf of the City, but rather is relying upon its own examination and
inspection of the Convention Center Parcel. If any Hazardous Materials in any
quantities that violate any Environmental Laws are discovered on any portion of
the Convention Center Parcel or within the Convention Center, Tenant shall, at its
sole cost and expense, cause such Hazardous Materials to be removed in
accordance with all applicable Environmental Laws; provided, however, that the
City shall be liable to Tenant for the foregoing to the extent resulting from the
willful misconduct or gross negligence of the City.
10.4 Mutual Covenants. Commencing with the Effective Date, each Party covenants
and agrees to the other Party as follows:
(A) Additional Documents and Approval. Each Party, upon the reasonable
request of the other Party, shall execute or cause to be executed any
further documents, take any further actions and grant any further
approvals as may be reasonably necessary in order to consummate the
transactions provided for in this Agreement.
(B) Notice of Matters. Should Tenant or the City receive knowledge about
any matter that may constitute a breach of any of its representations,
warranties or covenants set forth in this Agreement, it shall promptly
notify the other Party of the same in writing.
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11. Default and Remedies
11.1 Tenant Default. Each of the following events will, unless otherwise expressly
agreed by the City in writing, constitute a "Tenant Default" under this
Agreement:
(A) Tenant materially breaches any material provision of this Agreement
applicable to Tenant, and such material breach continues for a period of
sixty(60) days after written notice thereof by the City to Tenant; or, if
such material breach cannot reasonably be cured within such 60-day
period, Tenant does not commence to cure such material breach within
such 60-day period or, after commencing to cure such material breach,
does not thereafter pursue such cure in good faith to completion.
(B) Except as otherwise permitted under Section 16, the Leasehold Estate is
taken upon execution or by other process of law attached against Tenant,
or is subject to any attachment by any creditor or claimant against Tenant
and such attachment is not discharged or disposed of within ninety(90)
days after levy.
(C) Tenant files a petition in bankruptcy or insolvency, or for reorganization
or arrangement under any Applicable Laws related to bankruptcy or
insolvency, or voluntarily takes advantage of any such Applicable Laws
by answer or otherwise, or dissolves or makes a general assignment for the
benefit of creditors, or involuntary proceedings under any such Applicable
Laws or for the dissolution of Tenant are instituted against Tenant, or a
receiver or trustee is appointed for the Leasehold Estate or for all or
substantially all of Tenant's property, and such involuntary proceedings
are not dismissed or such receivership or trusteeship vacated within
ninety(90) days after such institution or appointment.
11.2 City's Remedies. If any Tenant Default occurs, the City shall have the right,
subject to the rights of Leasehold Mortgagees, if any, under Section 16, to
exercise any one or more of the remedies described below. Exercise of any of
such remedies shall not prevent the concurrent or subsequent exercise of any other
remedy provided for in this Agreement or otherwise available to the City at law or
in equity, except as otherwise expressly stated in this Agreement.
(A) The City may, without releasing Tenant from any obligations under this
Agreement, make any payment or take any action as the City deems
necessary or desirable to cure any Tenant Default in such manner and to
such extent as the City in good faith deems necessary or desirable. Tenant
shall pay the City, upon demand, all reasonable advances, costs and
expenses of the City in connection with making any such payment or
taking any such action, including reasonable attorneys' fees, together with
interest on all such amounts at the Default Rate from the date of payment
of any such advances, costs and expenses by the City.
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(B) The City may seek to obtain damages, specific performance, other
equitable relief or any combination of the foregoing pursuant to Section
18.22; provided, however, that the City may not terminate this Agreement
for a Tenant Default.
11.3 City Default. Each of the following events will, unless otherwise expressly
agreed by the Tenant in writing, constitute a "City Default" under this
Agreement:
(A) The City materially breaches any material provision of this Agreement
applicable to the City, and such material breach continues for a period of
sixty(60) days after written notice thereof by Tenant to the City; or, if
such material breach cannot reasonably be cured within such 60-day
period, the City does not commence to cure such material breach within
such 60-day period or, after commencing to cure such material breach,
does not thereafter pursue such cure in good faith to completion.
(B) Except as otherwise permitted under Section 16, the Fee Estate is taken
upon execution or by other process of law attached against the City, or is
subject to any attachment by any creditor or claimant against the City and
such attachment is not discharged or disposed of within ninety(90) days
after levy.
(C) The City files a petition in bankruptcy or insolvency, or for reorganization
or arrangement under any Applicable Laws related to bankruptcy or
insolvency, or voluntarily takes advantage of any such Applicable Laws
by answer or otherwise, or dissolves or makes a general assignment for the
benefit of creditors, or involuntary proceedings under any such Applicable
Laws or for the dissolution of the City are instituted against the City, or a
receiver or trustee is appointed for the Convention Center, the Convention
Center Parcel or all or substantially all of the City's property, and such
involuntary proceedings are not dismissed or such receivership or
trusteeship vacated within ninety (90) days after such institution or
appointment.
11.4 Tenant's Remedies. If any City Default occurs, Tenant shall have the right,
subject to the rights of each Leasehold Mortgagee, if any, under Section 16, to
exercise any one or more of the remedies described below. Exercise of any of
such remedies shall not prevent the concurrent or subsequent exercise of any other
remedy provided for in this Agreement or otherwise available to Tenant at law or
in equity, except as otherwise expressly stated in this Agreement.
(A) Tenant may, without releasing the City from any obligations under this
Agreement, make any payment or take any action as Tenant deems
necessary or desirable to cure any City Default in such manner and to such
extent as Tenant in good faith deems necessary or desirable. The City
shall pay Tenant, upon demand, all reasonable advances, costs and
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expenses of Tenant in connection with making any such payment or taking
any such action, including reasonable attorneys' fees, together with
interest on all such amounts at the Default Rate from the date of payment
of any such advances, costs, and expenses by Tenant.
(B) Tenant may seek to obtain damages, specific performance, other equitable
relief or any combination of the foregoing pursuant to Section 18.22;
provided, however, that Tenant may not terminate this Agreement for a
City Default.
11.5 Waiver. The Parties hereby waive any and all rights to consequential, punitive or
exemplary damages for a Tenant Default or a City Default, as the case may be;
provided, however, the foregoing waiver shall not apply to third-party claims for
which a Party is entitled to indemnification under Section 13 or fraud.
12. Title; Surrender
12.1 Title. The Parties acknowledge and agree that, during the Leasehold Term, and
subject to Tenant's Leasehold Estate and Purchase Option, any Leasehold
Mortgage and Section 18.1, the City will own and have fee title to the Convention
Center Parcel and the Convention Center (including all improvements that are
now or hereafter permanently fixed to the Convention Center Parcel or to the
Convention Center), notwithstanding the fact that the same may have been, or
may be, as appropriate, acquired, financed, installed or placed on the Convention
Center Parcel or in the Convention Center by Tenant.
12.2 Surrender. Subject to Section 9.1(D), upon the expiration of the Leasehold Term
or earlier termination of this Agreement, if Tenant does not exercise, the Purchase
Option pursuant to Section 17, then Tenant shall, on or before the Expiration Date
or earlier termination, as the case may be, peaceably and quietly leave, surrender
and yield to the City (i)the Convention Center and the Convention Center Parcel,
free of subtenancies, in a reasonably clean condition and free of debris and
otherwise in the condition required under this Agreement, (ii) all keys and codes
for the Convention Center, (iii)to the extent in the possession or control of
Tenant or any of its Affiliates, all plans and specifications, operating manuals and
computer programs and software used in connection with the operation or
management of the Convention Center and (iv) all personal property used in
connection with the operation or management of the Convention Center;
provided, however, that Tenant shall remove or cause to be removed (as opposed
to surrendering and yielding to the City) at or prior to the Expiration Date or
earlier tennination, as the case may be, any personal property of Tenant, or any of
Tenant's other sublicensees or Concessionaires and shall repair, at Tenant's sole
cost and expense, any damage to the Convention Center or the Convention Center
Parcel caused by Tenant's removal of such personal property. To the extent
Tenant fails to surrender the Convention Center and the Convention Center Parcel
to the City in the condition required by this Section 12.2, the City shall have the
right (in additional to all other rights and remedies under this Agreement), but not
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the obligation, to put the Convention Center and the Convention Center Parcel in
such condition and Tenant shall reimburse the City promptly upon demand for
any costs incurred by the City with respect thereto (including any costs incurred
by the City with respect to removal, transportation or storage of abandoned items
of personal property).
13. Indemnification
13.1 Tenant. To the extent permitted by Applicable Law, Tenant hereby agrees to
defend, hold harmless and indemnify the City,the Leasehold Mortgagee, and their
respective officers, employees, and agents, and each and every one of them, from
and against any and all actions, damages, costs, liabilities, claims, demands,
losses, judgments, penalties, costs and expenses of every type and description,
whether arising on or off the Convention Center Parcel, including, but not limited
to, any fees and costs reasonably incurred by outside counsel, and any fees and
expenses incurred in enforcing this provision (hereafter collectively referred to as
"Liabilities"), suffered or incurred by such indemnified party as a result of
(i) Tenant's use or operation of the Convention Center, (ii) any breach by Tenant
of this Agreement; (iii)the negligent acts or omissions or willful misconduct of
Tenant and any of its agents, contractors or employees, including any fraudulent
acts or misrepresentations in the performance or non-performance of its duties
and obligations under this Agreement; (iv) Tenant acting outside the scope of its
duties or authority hereunder or (v) the presence, release or discharge of
Hazardous Materials on or from the Convention Center Parcel or the Convention
Center; provided that the foregoing indemnity does not apply to any Liability to
the extent arising from (A)the negligence or willful misconduct of the City or its
agents, consultants or employees, or (B) any breach by the City of this
Agreement.
13.2 The City. To the extent permitted by Applicable Law, the City hereby agrees to
defend, hold harmless and indemnify Tenant, its members, managers, officers,
parents, subsidiaries, employees and agents, and each and every one of them,
from and against any and all Liabilities suffered or incurred by such indemnified
party as a result of (i) any breach by the City of this Agreement, or (ii)the
negligent acts or omissions or willful misconduct of the City or its agents,
consultants or employees, including any fraudulent acts or misrepresentations in
the performance of non-performance of its duties and obligations under this
Agreement; provided that the foregoing indemnity does not apply to any Liability
to the extent arising from (A)the negligence or willful misconduct of, or defects
in design furnished by, Tenant, or its respective agents, contractors or employees
or(B) any breach by Tenant of this Agreement.
14. Covenant of Quiet Enjoyment. So long as Tenant performs in all material respects its
obligations under this Agreement, the City shall do nothing (other than the acts permitted or
required by this Agreement) that will prevent Tenant or its licensees, guests or invitees from
peaceably and quietly enjoying, using and occupying the Convention Center in the manner
described in this Agreement, and the City shall (x) defend Tenant's quiet enjoyment, use and
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occupancy of the Convention Center in the manner described in this Agreement against the
claims of all Persons claiming by, under, or through the City and (y) not permit any lien,
encumbrance, right-of-way, covenant, condition, invalidity or other matter adversely affecting
the City's right to possess and use, or its title to, the Convention Center Parcel to diminish,
disturb or impair Tenant's and its licensees', guests' and invitees' quiet enjoyment, use and
occupancy of the Convention Center hereunder.
15. Estoppel Certificate; Memorandum of Agreement
15.1 Estoppel Certificate. Each of the Parties shall, upon the reasonable request of the
other (or any current or prospective source of financing for the City, Tenant, or
any of their Affiliates or any transferee or assignee), and in each case within
ten (10) Business Days after the other Party has requested it, execute and deliver
to the appropriate Persons a certificate in recordable form stating:
(A) That this Agreement is unmodified and is in full force and effect (or, if
there have been modifications, that this Agreement is in full force and
effect as modified and stating the modifications or, if this Agreement is
not in full force and effect, that such is the case);
(B) That, to the knowledge of the Party providing the certificate, there are no
defaults by it or the other Party under this Agreement (or specifying each
such default as to which it may have knowledge);
(C) The Effective Date, the Substantial Completion Date and the then-current
Expiration Date;
(D) The date(s) to which any financial obligation of the Party has been paid
under this Agreement;
(E) To the knowledge of the Party providing the certificate, whether there are
any counterclaims against the enforcement of any Party's obligations
under this Agreement; and
(F) Any other matters reasonably requested.
15.2 Memorandum of Agreement. At any time Tenant may cause a memorandum of
this Agreement or any amendment hereto to be recorded in the recorder's office
for the County and Tenant shall pay and discharge the costs, fees and taxes in
connection therewith.
16. Leasehold Mortgages
16.1 Right to Obtain Leasehold Mortgages. Notwithstanding anything to the contrary
contained in this Agreement, Tenant shall have the right, without the City's
consent, to execute and deliver one or more Leasehold Mortgages encumbering
the Leasehold Estate or the direct or indirect ownership interests in Tenant at any
time and from time to time; provided, that (A) no such Leasehold Mortgage shall
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encumber the Fee Estate, and (B)the proceeds from the debt secured by such
Leasehold Mortgage will not be used for purposes other than the design,
development, construction, financing, management, maintenance, repair,
replacement, leasing, use or operation of the Land, the Convention Center, and
other improvements related to the Project, and the refinancing of mortgage loans
related thereto. The City shall not be required to join in or subordinate the Fee
Estate and no such Leasehold Mortgage shall extend to or affect the Fee Estate.
Each Leasehold Mortgage shall provide that the Leasehold Mortgagee shall send
to the City copies of all notices of material default sent to Tenant in connection
with the Leasehold Mortgage or the debt secured thereby, provided that the failure
to provide any such notice shall not affect the validity of the notice in any manner.
16.2 Effect of a Leasehold Mortgage. Notwithstanding anything to the contrary in
this Agreement, Tenant's making of a Leasehold Mortgage shall not be deemed to
constitute an Assignment of the Leasehold Estate, nor shall any Leasehold
Mortgagee, as such, or in the exercise of its rights under this Agreement, be
deemed to be an assignee or transferee or mortgagee in possession of the
Leasehold Estate so as to require such Leasehold Mortgagee, as such, to assume
or otherwise be obligated to perform any of Tenant's obligations under this
Agreement except when, and then only for so long 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 to cure
defaults or exercise Mortgagee's Cure Rights). No Leasehold Mortgagee (or
other Person acquiring the Leasehold Estate pursuant to a Foreclosure Event)
shall have any liability beyond its interest in this Agreement nor shall Leasehold
Mortgagee (or any Person acquiring the Leasehold Estate pursuant to a
Foreclosure Event under a Leasehold Mortgage) be liable under this Agreement
unless and until such time as it becomes the owner of the Leasehold Estate.
Without further notice to or consent from the City, the City recognizes and agrees
that a Leasehold Mortgagee 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
Leasehold Mortgagee under this Agreement with the same force and effect as if
such party were the Leasehold Mortgagee itself.
16.3 Foreclosure; Further Assignment. Notwithstanding anything to the contrary in
this Agreement, any Foreclosure Event or any exercise of rights or remedies
under any Leasehold Mortgage shall not be deemed to violate this Agreement or
require the consent of the City. If a Leasehold Mortgagee or a successor or
assignee of a Leasehold Mortgagee, or an Affiliate thereof, acquires Tenant's
Leasehold Estate following a Foreclosure Event, or if a Leasehold Mortgagee or a
successor or assignee of a Leasehold Mortgagee, or an Affiliate thereof, enters
into a New Agreement, such Leasehold Mortgagee or successor or assignee of a
Leasehold Mortgagee, or an Affiliate thereof, shall enjoy all of the rights and
protections granted to Leasehold Mortgagee under this Agreement with the same
force and effect as if such successor, assign or Affiliate were the Leasehold
Mortgagee itself and may thereafter assign or transfer this Agreement or such
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New Agreement without prior notice to or consent of the City; provided, that the
assignee or transferee expressly agrees in writing to assume and to perform all of
the obligations under this Agreement 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
this Agreement nor shall Leasehold Mortgagee (or person acquiring the Leasehold
Estate pursuant to a Foreclosure Event under a Leasehold Mortgage) be liable
under this Agreement unless and until such time as it becomes, and then only for
so long as it remains, the owner of the Leasehold Estate.
16.4 Notice of Leasehold Mortgages. Promptly after Tenant enters into any Leasehold
Mortgage, Tenant or the Leasehold Mortgagee shall deliver to the City a true and
correct copy of the Leasehold Mortgage together with written notification
specifying the name and address of the Leasehold Mortgagee. The Leasehold
Mortgagee identified in such notice or the mortgage filed of record shall be
entitled to all the rights and protections of a Leasehold Mortgagee under this
Agreement (as against both the City and any successor holder of the Fee Estate).
The City agrees to acknowledge to Tenant and such Leasehold Mortgagee the
City's receipt of any such materials and, following notification thereof, notice of
any Assignment of such Leasehold Mortgage and to confirm that such Leasehold
Mortgagee is or will be, upon closing of its financing or its acquisition of an
existing Leasehold Mortgage, entitled to all of the rights and protections granted
to Leasehold Mortgagee under this Agreement with the same force and effect as if
such successor, assign or Affiliate were the Leasehold Mortgagee itself, in this
Agreement, including after any premature termination of this Agreement. If the
City has received actual or constructive notice of any Leasehold Mortgage, then
such notice shall automatically bind the City's successors and assigns.
16.5 Modifications Required by Leasehold Mortgagee. If, in connection with
obtaining, continuing or renewing any financing for which the Leasehold Estate,
or the direct or indirect equity interests in Tenant, represents collateral in whole or
in part, the Leasehold Mortgagee requires any modifications of this Agreement as
a condition to such financing, then the City shall, at Tenant's or such Leasehold
Mortgagee's request, promptly consider any such modifications in good faith. If
such modifications do not (A) modify the annual Rent or the Term or (B) lessen
the City's rights or increase the City's obligations under this Agreement by more
than a de minimis amount in the reasonable judgment of the City, then the City
shall execute and deliver to Tenant an amendment to this Agreement to effect
such modifications.
16.6 Further Assurances. Upon request by Tenant or by any existing or prospective
Leasehold Mortgagee, the City shall deliver to the requesting party such
documents and agreements as the requesting party shall reasonably request to
further effectuate the terms of this Agreement, including a separate written
instrument in recordable form signed and acknowledged by the City setting forth
and confirming, directly for the benefit of Leasehold Mortgagee and its successors
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and assigns, any or all rights of Leasehold Mortgagee; provided, however, that
Tenant shall reimburse the City immediately upon demand therefor for any and all
reasonable third-party costs or expenses actually incurred by the City in
complying with this Section 16.6.
16.7 Protection of Leasehold Mortgagees. Notwithstanding anything to the contrary
set forth in this Agreement, if, and only for so long as, any Leasehold Mortgage is
in effect, the following shall apply:
(A) Lease Impairments. Except as set forth in Section 16.7(J), any Lease
Impairment made without First Leasehold Mortgagee's prior written
consent (or any deemed consent under its Leasehold Mortgage) shall be
null, void, and of no further force or effect, and shall not bind Tenant,
Leasehold Mortgagee or New Operator. For clarification, this
Section 16.7(A) shall be inapplicable during any period that no Leasehold
Mortgage is in effect.
(B) Copies of Notices. If the City shall give any notice to Tenant under this
Agreement, then the City shall at the same time and by the same means
give a copy of such notice to any Leasehold Mortgagee. No notice to
Tenant shall be effective unless and until such notice has been duly given
to Leasehold Mortgagee, provided the City has received notice of such
Leasehold Mortgagee pursuant to Section 16.4. No exercise of the City's
rights and remedies under or termination of this Agreement shall be
deemed to have occurred or arisen or be effective unless the City has
given like notice to each Leasehold Mortgagee as this Section 16.7(B)
requires. Any such notice shall describe in reasonable detail the alleged
Tenant default or other event allegedly entitling the City to exercise such
rights or remedies.
(C) Tenant's Cure Period Expiration Notice. If Tenant is in default under this
Agreement and the cure period applicable to Tenant expires without cure
of Tenant's default, then the City shall promptly give notice of such fact to
any Leasehold Mortgagee, which notice shall describe in reasonable detail
Tenant's default(an "Tenant's Cure Period Expiration Notice").
(D) Right to Perform Covenants and Agreements. Any Leasehold Mortgagee
shall have the right, but not the obligation, to perform any obligation of
Tenant under this Agreement and to remedy any default by Tenant. The
City shall accept performance by or at the instigation of a Leasehold
Mortgagee in fulfillment of Tenant's obligations, for the account of
Tenant, and with the same force and effect as if performed by Tenant. No
performance by or on behalf of such Leasehold Mortgagee shall cause it to
become a "mortgagee in possession" or otherwise cause it to be deemed to
be in possession of the Convention Center or bound by or liable under this
Agreement.
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(E) Notice of Default and Cure Rights. Upon receiving any notice of default,
any Leasehold Mortgagee shall have the right within the same cure period
granted to Tenant under this Agreement, plus the additional time provided
for below within which to take (if any Leasehold Mortgagee so elects)
whichever of the actions set forth below in the remainder of this
Section 16.7 shall apply as to the default described in such notice of
default (such actions, "Mortgagee's Cure"; and a Leasehold Mortgagee's
rights to take such actions, including pursuit of an Enforcement Action,
collectively, "Mortgagee's Cure Rights").
(F) Monetary Defaults. In the case of a monetary default, any Leasehold
Mortgagee shall be entitled (but not required)to cure such default within a
cure period consisting of Tenant's cure period under this Agreement
extended through the date ninety (90) days after such Leasehold
Mortgagee shall have received Tenant's Cure Period Expiration Notice as
to such monetary default.
(G) Nonmonetary Defaults Curable Without Obtaining Possession. In the case
of any nonmonetary default that any Leasehold Mortgagee is reasonably
capable of curing without obtaining possession of the Convention Center
(excluding in any event a Personal Default), such Leasehold Mortgagee,
provided that the Annual Rent (and all other amounts required to be paid
by Tenant under this Agreement) shall continue to be paid timely during
the pendency of such extended cure period, shall have the right (but not
the obligation) to cure such nonmonetary default by taking the following
actions:
(1) Within a period consisting of Tenant's cure period for such
nonmonetary default, extended through the date ninety(90) days
after receipt of Tenant's Cure Period Expiration Notice as to such
default, such Leasehold Mortgagee shall provide written notice to
the City of such Leasehold Mortgagee's intention to take all
reasonable steps necessary to remedy such default (it being
understood that such notice is a statement of intention and not an
obligation); and
(2) Duly commence the cure of such nonmonetary default within such
extended period, and thereafter (during and after such extended
period) diligently prosecute to completion the remedy of such
default, but, subject to Force Majeure Events, in no event more
than one hundred twenty (120) days after Leasehold Mortgagee's
receipt of Tenant's Cure Period Expiration Notice as to such
default.
For the purposes of this Section 16.7(G), a nonmonetary default will not
be deemed incapable of cure by a Leasehold Mortgagee simply because
the timeline for performance of the underlying obligation has passed.
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(H) Defaults Curable Only by Obtaining Possession and Personal Defaults.
In the case of(i) a nonmonetary default that is not reasonably susceptible
of being cured by such Leasehold Mortgagee without obtaining possession
of the Convention Center or (ii) a Personal Default by Tenant, such
Leasehold Mortgagee shall be entitled (but not required) to proceed as
described in Sections 16.7(I) and 16.7(J) (provided that (x)the annual
Rent and any other amounts required to be paid by Tenant hereunder shall
continue to be paid timely during the pendency of such extended cure
period, and (y) with respect to any nonmonetary defaults outstanding
under Section 16.7(G), such Leasehold Mortgagee shall be exercising its
Mortgagee's Cure Rights thereunder).
(I) During Cure Period. At any time during the cure period (if any) that
applies to Tenant, extended through the date that is
one hundred twenty (120) days after such Leasehold Mortgagee's receipt
of Tenant's Cure Period Expiration Notice as to such nonmonetary
default, or if no cure period applies to Tenant, then within ninety
one hundred twenty (120) days after such Leasehold Mortgagee's receipt
of notice of such default, such Leasehold Mortgagee shall be entitled to
institute proceedings, and (subject to any stay in any Bankruptcy
Proceedings affecting Tenant or any injunction, unless such stay or
injunction is lifted) provided that from and after the institution of such
proceedings, such Leasehold Mortgagee shall diligently prosecute the
same to completion, to obtain possession of the Convention Center as
mortgagee (including possession by a receiver), or acquire directly, or
cause its assignee, nominee, or designee to acquire, the Leasehold Estate
through a Foreclosure Event, or foreclose on its pledged collateral, as
applicable (the obtaining of such possession or the completion of such
acquisition, "Control of the Convention Center").
(1) Further Cure After Control of Convention Center. Upon obtaining
Control of the Convention Center (whether before or after
expiration of any otherwise applicable cure period), such
Leasehold Mortgagee or, in the event the Leasehold Estate is
acquired through a Foreclosure Event, such New Operator, shall be
required to proceed with reasonable diligence and reasonable
continuity to cure such nonmonetary defaults as are then
reasonably susceptible of being cured by such Leasehold Mortgage
or New Operator (excluding Tenant's Personal Defaults, which
Leasehold Mortgagee need not cure), within a reasonable time
under the circumstances, but, subject to Force Majeure Events, in
no event more than one hundred twenty(120) days after Leasehold
Mortgagee obtains Control of the Convention Center.
(2) Effect of Cure. Upon the cure of a default by such Leasehold
Mortgagee or New Operator, as the case may be, in accordance
with this Agreement, this Agreement shall continue in full force
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and effect as if no default(s) had occurred. Leasehold Mortgagee's
exercise of Mortgagee's Cure Rights shall not be deemed an
assumption of this Agreement in whole or in part.
(J) Forbearance by the City.
(1) So long as a Leasehold Mortgagee shall be diligently exercising its
Mortgagee's Cure Rights, including the commencement and
pursuit of an Enforcement Action, within the applicable cure
periods set forth above, the City shall not, to the extent permitted
under this Agreement, (i) re-enter the Convention Center to cure
the Tenant Event of Default, (ii) bring a proceeding on account of
such default to (a) re-enter the Convention Center to cure the
Tenant Event of Default, (b) dispossess Tenant or other occupants
of the Convention Center, (c)terminate the Leasehold Estate, or
(d) replace the management company pursuant to Section 11.2(B)),
or (iii) accelerate payment of the Annual Rent or any other
amounts payable by Tenant under this Agreement. Upon (A)any
cessation of a Leasehold Mortgagee exercising Mortgagee's Cure
Rights or (B)the expiration of the applicable cure period, as
extended in connection with Mortgagee's Cure Rights, without
cure, the City may, upon notice to such Leasehold Mortgagee,
exercise any of the City's rights under this Agreement with respect
to dispossession or termination. Notwithstanding the foregoing,
the City shall have the right to re-enter the Convention Center, or
bring a proceeding to so re-enter the Convention Center, to cure
the applicable Tenant Event of Default if the Leasehold Mortgagee
that is exercising its Mortgagee's Cure Rights does not have
Control of the Convention Center at such time; provided, however,
that (1)the City gives prior written notice thereof to such
Leasehold Mortgagee, and (2) no such cure by the City shall be
deemed to diminish any of the Mortgagee's Cure Rights.
(2) Nothing in this Section 16 shall, however, be construed to either
(i) extend the Term beyond the Expiration Date that would have
applied if no default had occurred or (ii) require any Leasehold
Mortgagee to cure any Personal Default by Tenant as a condition
to preserving this Agreement or to obtaining a New Agreement
(but this shall not limit such Leasehold Mortgagee's obligation to
seek to obtain Control of the Convention Center, and thereafter
consummate a Foreclosure Event, by way of Mortgagee's Cure
Rights, if such Leasehold Mortgagee desires to preclude the City
from terminating this Agreement on account of a Personal Default
of Tenant).
(3) Nothing in this Section 16 shall preclude the City from exercising
its rights to sue for damages, specific performance, or other
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equitable relief (excluding "self-help", dispossession, termination
or engagement of new management company) under
Section 11.2(B).
(K) Leasehold Mortgagee's Right to Enter Convention Center. The City and
Tenant authorize each Leasehold Mortgagee to enter the Convention
Center and the Convention Center Parcel as necessary to effect
Mortgagee's Cure and take any action(s) reasonably necessary to effect
Mortgagee's Cure without such action being deemed to give Leasehold
Mortgagee possession of the Convention Center or the Convention Center
Parcel.
(L) Rights of New Operator Upon Acquiring Control. If any New Operator
shall acquire the Leasehold Estate pursuant to a Foreclosure Event and
shall continue to exercise Mortgagee's Cure Rights as to any remaining
defaults (other than Personal Defaults, which New Operator need not
cure), then any Personal Defaults by Tenant shall no longer be deemed
defaults and the City shall recognize the rights of such New Operator
hereunder as if such New Operator were Tenant.
(M) Interaction Between Agreement and Leasehold Mortgage. Tenant's
default as mortgagor under a Leasehold Mortgage shall not constitute a
default under this Agreement, except to the extent that Tenant's actions or
failure to act in and of itself constitutes a breach of this Agreement. The
exercise of any rights or remedies of a Leasehold Mortgagee under a
Leasehold Mortgage, including the consummation of any Foreclosure
Event, shall not constitute a default under this Agreement (except to the
extent such actions otherwise constitute a breach of this Agreement).
16.8 First Leasehold Mortgagee's Right to a New Agreement.
(A) If this Agreement shall terminate by reason of the City exercising any
right it has under this Agreement to terminate, a rejection in Tenant's
bankruptcy, or option of Tenant to treat this Agreement as terminated
under 11 U.S.C. § 365(h)(1)(A)(i), or any comparable provision of
Applicable Law, the City shall promptly give notice of such termination to
any Leasehold Mortgagee of which the City has notice. The City shall,
upon a First Leasehold Mortgagee's request given within thirty(30) days
after such First Leasehold Mortgagee's receipt of such notice, enter into
(and if the City fails to do so, shall be deemed to have entered into) a new
lease of the Convention Center effective as of(or retroactively to) the date
of the termination of this Agreement, for the remainder of the Term, as if
no termination had occurred, with a New Operator on the same terms and
provisions of this Agreement, including the Purchase Option and all other
rights, options, privileges and obligations of Tenant under this Agreement,
but excluding any requirements that have already been performed or no
longer apply (a "New Agreement"); provided, that the First Leasehold
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Mortgagee shall, at the time of execution and delivery of such New
Agreement, (i)pay the City any and all Annual Rent and any other
amounts required to be paid by Tenant to the City under this Agreement
(determined as if this Agreement had not been terminated), and (ii)cure
any nonmonetary defaults (other than Personal Defaults, which First
Leasehold Mortgagee need not cure) under this Agreement (determined as
if this Agreement had not been terminated) or, if such nonmonetary
default is of a nature that it cannot with due diligence be cured upon such
execution and delivery, then the First Leasehold Mortgagee shall (x) upon
such execution and delivery, advise the City of its intention to take all
steps necessary to remedy such nonmonetary default (other than Personal
Defaults, which First Leasehold Mortgagee need not cure), and
(y)promptly and duly commence the cure of such default and thereafter
diligently prosecute to completion the remedy of such default, which
completion must be achieved within a reasonable time under the
circumstances, subject to Force Majeure Events. In no event, however,
shall the New Operator be required to cure a Personal Default of Tenant as
a condition to obtaining or retaining a New Agreement or otherwise.
From the date this Agreement terminates until the date of execution and
delivery of any such New Agreement (the "New Agreement Delivery
Date"), the City may, at its option, perform maintenance and repair of the
Convention Center and the Convention Center Parcel; provided, however,
the City shall not (1) operate the Convention Center or the Convention
Center Parcel in an unreasonable manner, (2)take any affirmative action
to cancel any license or sublease or accept any cancellation, termination or
surrender of a sublease, except due to such licensee's or subtenant's
default, or (3) lease any of the Convention Center or the Convention
Center Parcel except to New Operator.
(B) The following additional provisions shall apply to any New Agreement:
(1) Form and Priority. Any New Agreement (or, at the City's option,
a memorandum thereof) shall be in recordable form. Such New
Agreement shall not be subject to any rights, liens, or interests
other than permitted exceptions and other exceptions to title
existing as of the date of such New Agreement which were not
created by the City.
(2) Adjustment for Expenses. On the New Agreement Delivery Date,
the New Operator shall pay to the City expenses incurred by the
City during the period from the termination date of this Agreement
to the New Agreement Delivery Date.
(3) Assignment of Certain Items. On the New Agreement Delivery
Date, the City shall assign to New Operator all of the City's right,
title and interest in and to all moneys (including security deposits,
insurance proceeds and condemnation awards), if any, then held
33
by, or payable to, the City that Tenant (or Leasehold Mortgagee)
would have been entitled to receive but for termination of this
Agreement. On the New Agreement Delivery Date, the City shall
also transfer to New Operator all sublease and service contracts to
the extent assignable by the City.
(4) Preservation of Licenses and Subleases. Between the date of the
termination of this Agreement and the New Agreement Delivery
Date, the City shall not take any affirmative action to cancel any
license or sublease or accept any cancellation, termination or
surrender of a license or sublease (it being understood that the City
shall not be obligated to take any action to keep any licenses or
subleases in effect). Any license or sublease which was terminated
upon the termination of this Agreement as a matter of law, shall, at
New Operator's option, be reinstated upon execution of the New
Agreement.
(5) Separate Instrument. The City hereby agrees, at the request of any
Leasehold Mortgagee, to enter into a separate instrument (and
memorandum thereof in recordable form) memorializing such
Leasehold Mortgagee's rights under this Section 16.8.
16.9 Priority of Leasehold Mortgages. If there is more than one Leasehold Mortgage,
then whenever this Agreement provides a Leasehold Mortgagee with the right to
consent or approve or exercise any right granted in this Agreement, the exercise
or waiver of same by the First Leasehold Mortgagee shall control and be binding
upon the holder(s) of all junior Leasehold Mortgages. If there is Mezzanine
Financing in addition to a Leasehold Mortgage, then whenever this Agreement
provides a Leasehold Mortgagee with the right to consent or approve or exercise
any right granted in this Agreement, the exercise or waiver of same by the
Leasehold Mortgagee shall control and be binding upon the Mezzanine Lender.
16.10 Liability of Leasehold Mortgagee. If a New Operator shall acquire Tenant's
Leasehold Estate through a Foreclosure Event or a New Agreement shall be
granted to a New Operator pursuant to Section 16.8, such New Operator shall be
liable for the performance of all of Tenant's covenants under this Agreement or
such New Agreement, as the case may be, from and after the effective date of
such Foreclosure Event or New Agreement. If (A)the New Operator is a
Leasehold Mortgagee or its assignee, nominee or designee, (B) such Leasehold
Mortgagee, or its assignee, designee or nominee, as applicable, then assigns this
Agreement or the New Agreement to a third-party assignee, and (C) such third-
party assignee delivers to the City an agreement under which such assignee
assumes and agrees to perform all the terms, covenants, and conditions of this
Agreement or such New Agreement, in form reasonably acceptable to the City,
the Leasehold Mortgagee, or its assignee, designee or nominee, as applicable,
shall be automatically and entirely released and discharged from the performance,
34
covenants, and obligations of the New Operator under this Agreement or the New
Agreement,thereafter accruing.
16.11 Casualty and Condemnation Proceeds. If a casualty or a Condemnation Action
shall occur with respect to all or any portion of the Convention Center and the
Convention Center Parcel and restoration is to occur pursuant to the provisions of
this Agreement, any insurance proceeds shall be handled in accordance with
Section 9. The City understands that Tenant may irrevocably appoint Leasehold
Mortgagee as its representative to participate in any settlement regarding, and
with regard to, the disposition and application of said insurance proceeds or
Condemnation Awards. The City will recognize and deal with Leasehold
Mortgagee for such purposes. The City hereby acknowledges that no election by
Tenant not to restore in the event of a casualty or Condemnation Action shall be
effective unless Leasehold Mortgagee's consent has been granted to such election.
16.12 Mezzanine Lenders as Leasehold Mortgagees. The Parties agree that each lender
under a Mezzanine Financing (as hereinafter defined) (each such lender, a
"Mezzanine Lender") is intended to and shall be entitled to substantially the
same protections and rights set forth in this Section 16 as provided to a Leasehold
Mortgagee, modified as appropriate to reflect the nature of the limited liability
company or limited partnership interest or stock pledge, as applicable, in favor of
each such Mezzanine Lender, mutatis mutandis. If requested by Tenant in
connection with a Mezzanine Financing, the Parties agree to negotiate, in good
faith and with due diligence, an amendment to this Agreement or a separate
agreement, containing commercially reasonable terms and conditions in order to
specifically reflect such protections and rights set forth in this Section 16 as
applicable to a Mezzanine Lender. Tenant shall be responsible for the
out-of-pocket costs and expenses of the City's participation in such negotiations,
including reasonable attorney's fees. As used herein, a "Mezzanine Financing"
means a financing transaction which is secured by, inter alia, a pledge or
collateral assignment of any or all of the limited liability company or limited
partnership interests or the corporate stock of Tenant (or any entity holding a
direct or indirect interest in Tenant), as applicable, either together with or in lieu
of a Leasehold Mortgage (provided that if the same lender holds both a Leasehold
Mortgage and such a pledge or collateral assignment, such lender shall be a
Leasehold Mortgagee, and such financing transaction shall be a Leasehold
Mortgage, hereunder).
17. Purchase Option
17.1 Purchase Option. Tenant shall have the option to purchase all, or any part of, the
Convention Center and Convention Center Parcel and all Improvements thereon
from the City on the terms and conditions set forth in this Section 17 (the
``Purchase Option"). The Purchase Option shall be a continuing right.
17.2 Exercise. Tenant may exercise the Purchase Option by delivering written notice
thereof to the City at any time during the Term or, if there is any attempt by City
35
to terminate this Agreement or reject this Agreement, within six (6) months after
the effective date of such termination.
17.3 Option Purchase Price. The purchase price to be paid by Tenant to the City in
connection with the exercise of the Purchase Option (the "Option Purchase
Price") shall be equal to $1.00.
17.4 Closing. If Tenant exercises the Purchase Option in accordance with this
Section 17, then the closing of the conveyance of the Convention Center Parcel
and all Improvements thereon shall occur on a date set forth by Tenant in the
notice by which Tenant exercised its Purchase Option, subject to the City's
approval of such date, which will not be unreasonably withheld, conditioned or
delayed. At such closing, (A)the City shall convey fee title to the Convention
Center Parcel and all Improvements thereon (to the extent of City's interest in
such Improvements if any), free and clear of any liens, encumbrances and
obligations, except for easements and similar restrictions that do not adversely
affect or impact the use and operation of the Improvements and the Leased
Premises for their intended purposes and that impose no monetary obligations for
Tenant, to Tenant, (B) Tenant shall pay the Option Purchase Price to the City and
(C) the City and Tenant shall deliver such customary closing documents (e.g.,
settlement statements, title insurance, a survey tax reporting forms) and take such
customary actions as shall be required in order to effect such conveyance in
accordance with then-common Texas real estate conveyancing practice.
17.5 Survival/Forfeiture. This Section 17 shall survive the expiration of the Term or
termination of this Agreement pursuant to Section 9 (and regardless of Tenant,
Leasehold Mortgagees or Mezzanine Lenders receiving any amounts set forth in
Section 9.2 or 9.4).
18. Miscellaneous
18.1 Notices. Any notice or other communication under this Agreement must be in
writing and will be considered properly given and effective upon receipt if
delivered personally, by certified or registered mail (postage prepaid and return
receipt requested) or by overnight courier to the Parties at the following
addresses:
If to the City: If to Tenant:
City of Round Rock KR CC, Inc.
221 E. Main Street P.O. Box 590
Round Rock, TX 78664 1305 Kalahari Drive
Attn: City Manager Wisconsin Dells, WI 53965
Phone: (512) 218-5400 Attn: Mary Bonte Spath
Email: Phone: (608) 254-5320
citymanager a;roundrocktexas.gov Email: mboll tercr;kalahariresorts.com.
36
With copies to: With copies to:
Sheets & Crossfield Michael Best& Friedrich LLP
309 E. Main Street One South Pinckney Street, Suite 700
Round Rock, TX 78664 Madison, WI 53703
Attn: Stephan L. Sheets Attn: Michael S. Green
Phone: (512) 255-8877 Phone: (608)257.7482
Email: steveic�t,scrrlaw.com Email: msgreenLii)michaeIbest.corn
Either Party may from time to time designate a different address or persons for notices by
giving notice to that effect to the other Party in accordance with the terms and conditions
of this Section 18.2.
18.2 Force Majeure. Failure in performance by a Party under this Agreement due to a
Force Majeure Event shall not be deemed a breach of this Agreement. In
addition, when this Agreement provides a time for the performance of any
obligation, the time provided is extended if compliance is not possible due to a
Force Majeure Event. The extension time shall be equal to one day for each day
the Force Majeure Event prevents compliance. "Force Majeure Event" means
any act, event or condition that is beyond the reasonable control of the Party
asserting the Force Majeure Event, if it prevents or delays such Party from
performing any obligation under this Agreement, including the following: any act
of public enemy, terrorism, blockade, war, insurrection, civil disturbance,
explosion or riot; epidemic; landslide, earthquake, fire, storm, flood, washout or
other catastrophic weather event; any other act of God; and any strike, lockout or
other industrial disturbance.
18.3 Severability. If a court with jurisdiction rules that any part of this Agreement is
invalid, unenforceable or contrary to law or public policy, then the rest of this
Agreement remains valid and fully enforceable.
18.4 Obligations of the Parties. The obligations and undertakings of each Party under
or in accordance with this Agreement are obligations solely of such Party. Except
as otherwise expressly stated in this Agreement, no recourse shall be had, whether
in contract, in tort, or otherwise against any officer, director, employee, agent,
member, manager or representative of a Party in his, her or its individual capacity
on account of any obligation or undertaking of or any act or omission by such
Party under or pursuant to this Agreement.
18.5 Time of the Essence. Time is of the essence in the performance of this
Agreement.
18.6 Binding Effect. This Agreement binds and inures to the benefit of the Parties'
permitted successors and assigns.
37
18.7 Waiver. A Party's failure to insist on strict performance of this Agreement or to
exercise any right or remedy upon breach of this Agreement will not constitute a
waiver of the performance, right, or remedy. A Party's waiver of the other
Party's breach of any provision in this Agreement will not constitute a continuing
waiver or a waiver of any subsequent breach of the same or any other provision.
A waiver is binding only if set forth in a writing signed by the waiving Party.
18.8 Interpretation. The term "including" shall mean "including, without limitation"
and "including, but not limited to" and shall not be interpreted to imply any
limitation on the more general preceding provision unless otherwise expressly
stated. All references in this Agreement to Sections, Exhibits, or Schedules refer
to the Sections, Exhibits, and Schedules of this Agreement unless otherwise
expressly stated. Each Exhibit and Schedule referenced in this Agreement is
incorporated herein by reference and made a part hereof. The headings and
captions of the Sections, Exhibits and Schedules are included for convenience
only and shall have no effect upon the construction or interpretation of this
Agreement.
18.9 Integration and Modification. This Agreement sets forth the Parties' entire
understanding regarding the matters set forth in this Agreement and is intended to
be their final, complete and exclusive expression of those matters.
18.10 Relationship of the Parties. The Parties do not intend to create any agency,
partnership, joint venture, trust or other relationship with duties or incidents
different from those of parties to an arm's-length contract.
18.11 Third-Party Beneficiaries. Except for rights of a Leasehold Mortgagee and a
Mezzanine Lender provided herein, and as otherwise specifically provided in this
Agreement, this Agreement is solely for the benefit of the Parties and their
successors and assigns permitted under this Agreement and no provision of this
Agreement shall be deemed to confer upon any other Person any remedy, claim,
liability, reimbursement, cause of action or right.
18.12 Attorneys' Fees. Except as otherwise expressly stated herein, the Parties shall
bear their own costs and attorneys' fees incurred in connection with this
Agreement.
18.13 Counterparts. The Parties may sign this Agreement in counterparts, each of
which will be considered an original, but all of which will constitute the same
Agreement. Facsimile signatures or signatures transmitted by e-mail or other
electronic means shall be effective to bind the Parties.
18.14 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Texas. In the event of any proceedings
regarding this Agreement, the Parties agree that the venue shall be the state courts
of Texas located in Williamson County or the Texas Western District Court
located in Austin.
38
18.15 Payments. If any payment under this Agreement is required to be made on a day
other than a Business Day, the date of payment shall be extended to the next
Business Day.
18.16 Interest. Except as otherwise expressly set forth in this Agreement, any payment
required under this Agreement that is not timely made shall bear interest at the
Interest Rate from the due date until paid in full.
18.17 Survival. This Section 18 shall survive the expiration of the Term or termination
of this Agreement.
39
IN WITNESS WHEREOF, the Parties have entered in this Agreement as of the day and
year first above written.
CITY: TENANT:
CITY OF ROUND ROCK KR CC, INC.
By: - ' By:
Todd Nelson, President
[Signature Page to Convention Center Operating Lease]
Exhibit A
Description of the Land
OF A 351 . 737 ACRE TRACT OF LAND OUT OF THE P.A. HOLDER SURVEY,
ABSTRACT NO 297 SITUATED IN THE CITY OF ROUND ROCK, WILLIAMSON
COUNTY, TEXAS BEING A PORTION OF THE REMAINDER OF THAT CERTAIN
157. 385 ACRE TRACT OF LAND CONVEYED TO BISON TRACT 79, LTD. BY
DEED OF RECORD IN DOCUMENT NO. 2007049657 OF THE OFFICIAL PUBLIC
RECORDS OF WILLIAMSON COUNTY, TEXAS; ALL OF THAT CERTAIN 60. 58
ACRE TRACT OF LAND CONVEYED TO ERNEST NELSON JOHNSON, JOHN DAVID
JOHNSON AND BERTHA MARIE JOHNSON KELLER BY DEED OF RECORD IN
DOCUMENT NO. 2003035323 OF SAID OFFICIAL PUBLIC RECORDS, SAME
BEING ALL OF LOT 9 OF THE SWENSON SUBDIVISION, OF RECORD IN VOLUME
13, PAGE 119 OF THE DEED RECORDS OF WILLIAMSON COUNTY, TEXAS; ALL
OF THAT CERTAIN 155. 589 ACRE TRACT OF LAND CONVEYED TO KEITH
KRIENKE AND MARK MEREDITH BY DEED OF RECORD IN DOCUMENT NO.
2006113854 OF SAID OFFICIAL PUBLIC RECORDS, SAME BEING CONVEYED TO
GREGORY CARTER BY DEED OF RECORD IN DOCUMENT NO. 2010072268 OF
SAID OFFICIAL PUBLIC RECORDS; AND ALSO LOT 1, OF THE BERTIL
TELANDER SUBDIVISION, OF RECORD IN CABINET H. SLIDE 126 OF THE
PLAT RECORDS OF WILLIAMSON COUNTY, TEXAS AS CORRECTED BY
INSTRUMENT OF RECORD IN VOLUME 1419, PAGE 416 OF THE REAL PROPERTY
RECORDS OF WILLIAMSON COUNTY, TEXAS; SAID LOT 1 CONVEYED TO DAVID
BOYLES BY DEED OF RECORD IN DOCUMENT NO. 2014059825 OF THE
OFFICIAL PUBLIC RECORDS OF WILLIAMSON COUNTY, TEXAS; SAID 351 . 737
ACRE TRACT BEING MORE PARTICULARLY DESCRIBED IN FOUR PARTS BY
METES AND BOUNDS AS FOLLOWS:
PART 1 - 337.295 ACRES
BEGINNING, at a 5/8-inch iron rod found in the southerly right-of-
way line of the Union Pacific Railroad (100' R.O.W. ) being the
northeasterly corner of said 157 .385-acre tract, also being the
northwesterly corner of said 155. 589-acre tract;
THENCE, N63037 '28"E, leaving the northeasterly corner of said
157. 385 acre tract, along the southerly right-of-way line of the
Union Pacific Railroad, for a portion of the northerly line
hereof, a distance of 2864 . 50 feet to a 1/2-inch iron rod with
"Baker Aicklen" cap found at the northwesterly corner of Lot 1,
Block A of Final Plat of Brushy Creek Regional Wastewater
Treatment Plant, a subdivision of record in Document No.
2007067173 of said Official Public Records, being the
northeasterly corner of said 155. 589 acre tract and hereof;
THENCE, leaving the southerly right-of-way line of the Union
Pacific Railroad, along the common line of said Lot 1 and said
155. 589-acre tract, for the easterly line hereof, the following
six (6) courses and distances :
A-1
1) S26°12 ' 00"E, a distance of 49. 99 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
2) N63041106"E, a distance of 81. 63 feet to a 1/2-inch iron rod
with illegible cap found;
3) S03033' 52"E, a distance of 1695. 07 feet to a 1/2-inch iron
rod with "LORA" cap found;
4) N58053' 53"E, a distance of 362 . 51 feet to a 1/2-inch iron rod
with "LCRA" cap found;
5) N58035' 13"E, a distance of 245. 00 feet to a 1/2-inch iron rod
with "LCRA" cap found;
6) S02°28 ' 32"E, passing at a distance of 387 . 44 feet, a 1/2-inch
iron rod with "SURVCON INC" cap found, and continuing for a
total distance of 463. 04 feet to a point in the center of
Brushy Creek, being in the northerly line of Lot 59, Block F
of Final Plat of Freeman Park Subdivision Phase I, of record
in Document No. 2015010846 of said Official Public Records,
also being the most southerly southwesterly corner of said
Lot 1, for the southeasterly corner hereof;
THENCE, leaving the most southerly southwesterly corner of said
Lot 1, along or near the center of Brushy Creek, with the
northerly line of said Lot 59; the northerly line of Lot 26, Block
B of Lake Forest III, Village III Revised, a subdivision of record
in Document No. 2004095851 of said Official Public Records; the
northerly line of Lot 43, Block E of Final Plat of Sonoma Section
9, a subdivision of record in Document No. 2004021881 of said
Official Public Records; and the northerly line of Lot 46, Block F
of Final Plat of Sonoma Section 11, a subdivision of record in
Document No. 2005000171 of said Official Public Records for a
portion of the southerly line hereof, the following twenty-three
(23) courses and distances:
1) S71058101"W, a distance of 59. 92 feet to an angle point;
2) S66040111"W, a distance of 90.58 feet to an angle point;
3) S49032 ' 25"W, a distance of 78 . 88 feet to an angle point;
4) S40047 ' 39"W, a distance of 82 . 04 feet to an angle point;
5) S23037 ' 20"W, a distance of 81 . 79 feet to an angle point;
6) S28052104"W, a distance of 110. 18 feet to an angle point;
7) S36012 ' 52"W, a distance of 282 . 02 feet to an angle point;
8) S38003 ' 24"W, a distance of 84 . 64 feet to an angle point;
9) S47037112"W, a distance of 329. 19 feet to an angle point;
A-2
10) S15041 ' 16"E, a distance of 184 . 53 feet to an angle point;
11) S07027 ' 39"E, a distance of 150. 82 feet to an angle point;
12) S03049' 27"W, a distance of 142 .77 feet to an angle point;
13) S21018 ' 06"W, a distance of 94 . 11 feet to an angle point;
14) S44012101"W, a distance of 165. 58 feet to an angle point;
15) S69051 ' 49"W, a distance of 215. 14 feet to an angle point;
16) S45025 ' 49"W, a distance of 111 .25 feet to an angle point;
17) S26029136"W, a distance of 94 .25 feet to an angle point;
18) S31048 ' 00"W, a distance of 125. 62 feet to an angle point;
19) S51058 ' 20"W, a distance of 230. 16 feet to an angle point;
20) S61055' 26"W, a distance of 477 .59 feet to an angle point;
21) S54023 ' 53"W, a distance of 144 . 42 feet to an angle point;
22) S40028 ' 56"W, a distance of 383. 47 feet to an angle point;
23) S42015 ' 33"W, a distance of 108 . 54 feet to the southeasterly
corner of said 60 . 58-acre tract, for an angle point hereof;
THENCE, leaving the westerly line of said 155. 589-acre tract,
along or near the center of Brushy Creek, with the northerly line
of Lot 46 of said Sonoma Section 11 and the northerly line of Lot
46, Block F of Final Plat of Sonoma Section 12, a subdivision of
record in Document No. 2005000358 of said Official Public Records
for a portion of the southerly line hereof, the following five (5)
courses and distances :
1) S42015 ' 33"W, a distance of 148 . 42 feet to an angle point;
2) S80051111"W, a distance of 301 . 01 feet to an angle point;
3) S83008 ' 53"W, a distance of 200. 01 feet to an angle point;
4) S67032 ' 04"W, a distance of 132 . 76 feet to an angle point;
5) S62026' 47"W, a distance of 141 . 77 feet to the southeasterly
corner of said 157. 385-acre tract, being the southwesterly
corner of said 60 . 58-acre tract, for an angle point hereof;
THENCE, leaving the southwesterly corner of said 60 . 58-acre tract,
along the approximate center of Brushy Creek, with the northerly
line of said Lot 46 and in part along the northerly line of that
certain 1 .764-acre tract of land conveyed to the City of Round
Rock by deed of record in Document No. 2013056475 of said Official
A-3
Public Records, for the southerly line hereof, the following four
(4) courses and distances:
1) S70010109"W, a distance of 138 .30 feet to an angle point;
2) S58052 ' 42"W, a distance of 700. 00 feet to an angle point;
3) S67052 ' 42"W, a distance of 240. 00 feet to an angle point;
4) S53004 ' 42"W, a distance of 132 . 01 feet to a point in the
easterly right-of-way line of Kenney Fort Boulevard (R.O.W.
Varies) for the southwesterly corner hereof;
THENCE, leaving the approximate center of Brushy Creek and the
northerly line of said 1 . 764-acre tract, along the easterly right-
of-way line of Kenney Fort Boulevard, for a portion of the
westerly line hereof, the following nine (9) courses and
distances :
1) NO3027114"W, passing at a distance of 100. 00 feet, a 1/2-inch
iron rod with "BURY" cap set for reference, and continuing
for a total distance of 492 . 81 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
2) N85058 ' 17"E, a distance of 58 . 16 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
3) NO3026115"W, a distance of 243. 69 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
4) N19010' 44"W, a distance of 376. 64 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
5) N26022 ' 35"W, a distance of 1454 . 98 feet to a 1/2-inch iron
rod with "Baker Aicklen" cap found;
6) N22047126"W, a distance of 160.27 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
7) N26023 ' 34"W, a distance of 114 .86 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
8) N23012 ' 13"W, a distance of 254 .74 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
9) NO2018 ' 29"W, a distance of 323. 01 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found at the intersection of the
easterly right-of-way line of Kenney Fort Boulevard and the
southerly right-of-way line of the Union Pacific Railroad,
being in the northerly line of said 157 . 385-acre tract, for
the northwesterly corner hereof;
A-4
THENCE, N63036' 45"E, leaving the easterly right-of-way line of
Kenney Fort Boulevard, along the southerly right-of-way line of
the Union Pacific Railroad, being the northerly line of said
157.385-acre tract for the northerly line hereof, a distance of
2121 . 63 feet to the POINT OF BEGINNING, containing an area of
338. 795 acres (14, 627, 230 square feet) of land, more or less, SAVE
AND EXCEPT THEREFROM THE FOLLOWING TRACT OF LAND:
THAT CERTAIN 1. 50 ACRE TRACT OF LAND CONVEYED TO KEITH KRIENKE AND
LAURA RINEHART KRIENKE BY DEED OF RECORD IN DOCUMENT NO.
2006074399 OF SAID OFFICIAL PUBLIC RECORDS, TEXAS; SAID 1 .50 ACRE
TRACT BEING MORE PARTICULARLY DESCRIBED BY METES AND BOUNDS AS
FOLLOWS:
COMMENCING, a 1/2-inch iron rod with "Baker Aicklen" cap found in
the southerly right-of-way line of the Union Pacific Railroad for
the northwesterly corner of Lot 1, Block A of said Final Plat of
Brushy Creek Regional Wastewater Treatment Plant of record, being
the northeasterly corner of said 155.589-acre tract;
THENCE, S26012 ' 00"E, leaving the southerly right-of-way line of
the Union Pacific Railroad, along the common line of said 155 .589-
acre tract and said Lot 1, a distance of 49. 99 feet to a 1/2-inch
iron rod with "Baker Aicklen" cap found;
THENCE, S03034 ' 49"E, leaving the westerly line of said Lot 1, over
and across said 155. 589-acre tract, a distance of 291.32 feet to a
1/2-inch iron rod with "Stan Coalter" cap found for the POINT OF
BEGINNING, being the northeasterly corner of said 1 . 50-acre tract
and hereof;
THENCE, along the exterior lines of said 1 . 50-acre tract for the
exterior lines hereof, the following four (4) courses and
distances:
1) S03034 ' 49"E, a distance of 298 . 62 feet to a 1/2-inch iron rod
with "Stan Coalter" cap found for the southeasterly corner
hereof;
2) S74024 ' 52"W, a distance of 244 . 97 feet to a 1/2-inch iron rod
with "Stan Coalter" cap found for the southwesterly corner
hereof;
3) N06037 ' 52"E, a distance of 340. 30 feet to a 1/2-inch iron rod
with "Stan Coalter" cap found for the northwesterly corner
hereof;
4) N81044 ' 34"E, a distance of 179. 89 feet to the POINT OF
BEGINNING, containing an area of 1. 500 acres (65, 357 square
feet) of land, leaving a TOTAL NET AREA OF 337.295 ACRES
(14, 692, 570 square feet) of land, more or less, within these
metes and bounds.
A-5
PART 2 - 0.037 ACRES
BEGINNING, at a 1/2-inch iron rod with "Baker Aicklen" cap found
in the westerly right-of-way line of Kenney Fort Boulevard (R.O.W.
Varies) , being in the common line of said 157 .385-acre tract and
that certain 107 . 17-acre tract of land conveyed to John Bolt
Harris, Et. Al. by deed of record in Volume 2372, Page 112 of said
Official Public Records and to The Hickox Family Living Trust by
deed of record in Document No. 2006053683 of said Official Public
Records, for the northwesterly corner hereof;
THENCE, S28042 ' 41"E, leaving the easterly line of said 107 . 17-acre
tract, along the westerly right-of-way line of Kenney Fort
Boulevard for the northerly line hereof, a distance of 59. 01 feet
to a 1/2-inch iron rod with "Baker Aicklen" cap found for the
northerly corner of that certain 0 . 158-acre tract of land conveyed
to the City of Round Rock by deed of record in Document No.
2011041098 of said Official Public Records for the northeasterly
corner hereof;
THENCE, leaving the westerly right-of-way line of Kenney Fort
Boulevard, with the northerly line of said 0. 158-acre tract for
the easterly and southerly lines hereof, the following two (2)
courses and distances :
1) S17026131"W, a distance of 55 . 47 feet to a 1/2-inch iron rod
with "SAM" cap found for the southeasterly corner hereof;
2) S63037 ' 08"W, a distance of 8 . 52 feet to a 1/2-inch iron rod
with "BURY" cap set in the common line of said 107 . 17-acre
tract and said 157 .385-acre tract for the southwesterly
corner hereof from which, a 1/2-inch iron rod with "SAM" cap
found for the apparent northwesterly corner of said 0. 158-
acre tract as found bears, N76015130"E, a distance of 0 . 67
feet;
THENCE, NO2009' 44"W, leaving the northerly line of said 0 . 158-acre
tract, along the common line of said 107 . 17-acre tract and said
157 . 385-acre tract for the westerly line hereof, a distance of
108 . 54 feet to the POINT OF BEGINNING, containing an area of 0. 037
acres (1, 602 square feet) of land, more or less, within these
metes and bounds.
PART 3 - 4. 609 ACRES
COMMENCING, at a 1/2-inch iron rod with "Baker Aicklen" cap found
in the westerly right-of-way line of Kenney Fort Boulevard (R.O.W.
Varies) , being in the common line of said 157 . 385-acre tract and
that certain 107 . 17-acre tract of land conveyed to John Bolt
Harris, Et. Al. by deed of record in Volume 2372, Page 112 of said
Official Public Records and to The Hickox Family Living Trust by
deed of record in Document No. 2006053683 of said Official Public
Records, for the northwesterly corner hereof;
A-6
THENCE, S02009' 44"E, leaving the westerly right-of-way line of
Kenney Fort Boulevard, along the common line of said 107 . 17 acre
tract and said 157.385 acre tract, a distance of 196. 31 feet to a
1/2-inch iron rod with "BURY" cap set in the southerly line of
that certain 0. 158 acre tract of land conveyed to the City of
Round Rock by deed of record in Document No. 2011041098 of said
Official Public Records for the POINT OF BEGINNING, being the
northwesterly corner hereof from which, a 1/2-inch iron rod with
"SAM" cap found for the apparent southwesterly corner of said
0. 158 acre tract as found bears, N63°02 ' 14"E, a distance of 0. 70
feet;
THENCE, leaving the easterly line of said 107 . 17-acre tract, with
the southerly line of said 0 . 158-acre tract for the northerly line
hereof, the following two (2) courses and distances :
1) N63033 ' 51"E, a distance of 47 . 01 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
2) S71012 ' 55"E, a distance of 56. 50 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found in the westerly right-of-way
line of Kenney Fort Boulevard, being the southeasterly corner
of said 0. 158-acre tract, for the northeasterly corner
hereof;
THENCE, S26022 ' 11"E, leaving the southeasterly corner of said
0. 158-acre tract, over and across said 157 .385-acre tract, along
the westerly right-of-way line of Kenney Fort Boulevard for the
easterly line hereof, a distance of 695. 06 feet to a 1/2-inch iron
rod found for the northeasterly corner of that certain 0.864-acre
tract of land conveyed to the City of Round Rock by deed of record
in Document No. 2011041098 of said Official Public Records for the
southeasterly corner hereof;
THENCE, leaving the westerly right-of-way line of Kenney Fort
Boulevard, with the northerly line of said 0. 864-acre tract for
the southerly line hereof, the following two (2) courses and
distances:
1) S18036113"W, a distance of 56. 47 feet to a 1/2-inch iron rod
found;
2) S63036113"W, a distance of 395. 45 feet to a 1/2-inch iron rod
with "BURY " cap set in the common line of said 107 . 17-acre
tract and said 157 .385-acre tract for the southwesterly
corner hereof from which, a 1/2-inch iron rod found for the
apparent northwesterly corner of said 0. 864-acre tract as
found bears, N58°21 ' 23"E, a distance of 1 . 69 feet;
THENCE, NO2009' 44"W, leaving the northerly line of said 0. 864-acre
tract, along the common line of said 107 . 17-acre tract and said
157. 385-acre tract for the westerly line hereof, a distance of
849. 94 feet to the POINT OF BEGINNING, containing an area of 4 . 609
acres (200, 777 square feet) of land, more or less, within these
metes and bounds.
A-7
PART 4 - 9.796 ACRES
COMMENCING, at a 1/2-inch iron rod with "Baker Aicklen" cap found
in the westerly right-of-way line of Kenney Fort Boulevard (R.O.W.
Varies) , being in the common line of said 157 .385-acre tract and
that certain 107 .17-acre tract of land conveyed to John Bolt
Harris, Et. Al. by deed of record in Volume 2372, Page 112 of said
Official Public Records and to The Hickox Family Living Trust by
deed of record in Document No. 2006053683 of said Official Public
Records, for the northwesterly corner hereof;
THENCE, S02009 ' 44"E, leaving the westerly right-of-way line of
Kenney Fort Boulevard, along the common line of said 107 . 17 acre
tract and said 157. 385 acre tract, a distance of 1133. 82 feet to a
1/2-inch iron rod with "BURY" cap set in the southerly line of
that certain 0. 864 acre tract of land conveyed to the City of
Round Rock by deed of record in Document No. 2011041098 of said
Official Public Records for the POINT OF BEGINNING, being the
northwesterly corner hereof from which, a 1/2-inch iron rod with
"SAM" cap found for the apparent southwesterly corner of said
0. 864 acre tract as found bears, N62°52 ' 19"E, a distance of 1 . 77
feet;
THENCE, leaving the easterly line of said 107 . 17-acre tract, with
the southerly line of said 0. 864-acre tract for the northerly line
hereof, the following two (2) courses and distances:
1) N63036' 57"E, a distance of 431. 40 feet to a 1/2-inch iron rod
found;
2) S71027 ' 38"E, a distance of 56. 40 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found in the westerly right-of-way
line of Kenney Fort Boulevard, being the southeasterly corner
of said 0. 864-acre tract, for the northeasterly corner
hereof;
THENCE, leaving the southeasterly corner of said 0. 864-acre tract,
along the westerly right-of-way line of Kenney Fort Boulevard for
the easterly line hereof, the following four (4) courses and
distances:
1) S26022 ' 09"E, a distance of 250.82 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found at the point of curvature of a
non-tangent curve to the right;
2) Along said non-tangent curve to the right, having a radius of
1441 .72 feet, a central angle of 12°09'39", an arc length of
306. 00 feet, and a chord which bears, S21015 ' 08"E, a distance
of 305. 42 feet to a 1/2-inch iron rod with "Baker Aicklen"
cap found at the end of said curve;
3) S00008 ' 16"E, a distance of 360.25 feet to a 1/2-inch iron rod
with "Baker Aicklen" cap found;
A-8
4) S16°10' 46"W, a distance of 165 . 87 feet to a 1/2-inch iron rod
with "SAM" cap found for the most northerly northeasterly
corner of that certain 12 . 1-acre tract of land conveyed to
the City of Round Rock by deed of record in Document No.
2013049009 of said Official Public Records for the
southeasterly corner hereof;
THENCE, S88041 ' 51"W, leaving the westerly right-of-way line of
Kenney Fort Boulevard, along the northerly line of said 12. 1-acre
tract for the southerly line hereof, a distance of 267 . 19 feet to
a 1/2-inch iron rod with "Baker Aicklen" cap found in the easterly
line of that certain 4 . 42-acre tract of land conveyed to Thomas P.
Elrod Et. Ux. By deed of record in Document No. 1813, Page 540 of
said Official Public Records, being the westerly line of said
157 . 385-acre tract, also being the most northerly northwesterly
corner of said 12 . 1-acre tract for the southwesterly corner
hereof;
THENCE, N01023 ' 35"W, leaving the northerly line of said 12 .1-acre
tract, along the common line of said 157 . 385-acre tract and said
4 . 42-acre tract for a portion of the westerly line hereof, a
distance of 498. 34 feet to a 1/2-inch iron rod found for the
northeasterly corner of said 4 . 42-acre tract;
THENCE, S89011 ' 33"W, along the irregular westerly line of said
157. 385-acre tract and the northerly line of said 4 . 42-acre tract,
passing at a distance of 319. 72 feet, a 1/2-inch iron rod found
for the northwesterly corner of said 4 . 42-acre tract, and
continuing for a total distance of 323. 61 feet to a 1/2-inch iron
rod found in the common line of said 157 . 385-acre tract and said
107. 17-acre tract for the southwesterly corner hereof;
THENCE, NO2009144"W, along the common line of said 157 . 385-acre
tract and said 107 . 17-acre tract for a portion of the westerly
line hereof, a distance of 367. 85 feet to the POINT OF BEGINNING,
containing an area of 9. 796 acres (426, 728 square feet) of land,
more or less, within these metes and bounds.
BEARING BASIS: THE BASIS OF BEARING OF THE SURVEY SHOWN HEREON IS
TEXAS STATE PLANE COORDINATE SYSTEM, CENTRAL ZONE, NAD 83 (96) ,
UTILIZING WESTERN DATA SYSTEMS CONTINUALLY OPERATING REFERENCE
STATION (CORS) NETWORK.
A-9
Exhibit B
Legal Description and Depiction of the Convention Center Parcel
Lot 2, Block "C", Final Plat of Kalahari Resort and Replat of Bertil Telander Subdivision,
recorded as Document Number in the office of the Clerk of
Williamson County, Texas.
B-1
IQI
>
c
C
LL
LU WT 2
z I OT�C
z BLOCK C
Convention OC-enter Lot
2RUSHYCREEK
209554-0003\19619542.11
B-1
Recording Requested By:
Michael Best& Friedrich LLP
One South Pinckney Street, Suite 700
Madison, Wisconsin 53703
Attention: Michael S. Green
MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND OPTION
This MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND
OPTION (this "Amendment"), dated as of j(,- 240 , 2018 is entered into between
CITY OF ROUND ROCK, TEXAS, a Texas local government home rule corporation (the
"City"), and KR CC, INC., a Delaware corporation("Tenant").
RECITALS
A. The City and Tenant entered into that certain Convention Center Operating Lease
dated t/to (the "Lease"),2018 pursuant to which the City leases to Tenant, and
Tenant leases from the City, for the Term (as such term is defined in the Lease) the real property
described in Exhibit "A" attached hereto and incorporated herein by reference (the "Leased
Premises")
B. The City and Tenant desire to execute this Memorandum to provide constructive
notice of Tenant's rights under the Lease to all third parties.
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Term. The City has agreed to lease the Leased Premises to Tenant for the Term,
which Term will end at 11:59 p.m. on December 19, 2115.
2. Lease Terms. The lease of the Leased Premises to Tenant is pursuant to the
Lease, which is incorporated into this Memorandum by reference.
3. Purchase Option. Tenant shall have the option to purchase the Leased Premises
from the City (the "Purchase Option") upon and subject to the terms and conditions set forth in
the Lease.
4. Assignment. Tenant's ability to transfer its rights under the Lease and to sublease
the Leased Premises is set forth in more detail in the Lease.
5. Leasehold Mortgagee's Right to New Agreement. Tenant's leasehold mortgagees
are granted certain rights and protections, including notice and cure rights with respect to
Tenant's defaults and the right, under certain circumstances that result in the termination of the
Lease, to require the City to enter into a new lease with Tenant's senior leasehold mortgagee or
its assignee, nominee or designee, all as set forth in more detail in the Lease.
6. Encumbrances. The Lease prohibits City from mortgaging or otherwise
encumbering City's fee title interest in the Leasehold Premises with any mortgage, deed of trust,
security deed, deed to secure debt, or any other similar instrument or agreement constituting a
lien upon, or similarly encumbering, City's fee title interest in the Leasehold Premises.
7. Successors and Assigns. This Memorandum and the Lease shall bind and inure to
the benefit of the parties and their respective heirs, successors and assigns, subject, however, to
the provisions of the Lease.
8. Governing Law. This Memorandum and the Lease are governed by Texas law.
(Signatures appear on following pages)
2
IN WITNESS WHEREOF, the City and Tenant have entered in this Memorandum as of
the day and year first above written.
CITY:
CITY OF ROUND ROCK, TEXAS
a home rule city and municipal corporation
13By: n c'L
Br aVifilliams, Assistant City
t Manager
ACKNOWLEDGMENT
STATE OF TEXAS §
COUNTY OF Williamson §
dh- .
This instrument was acknowledged before me on the'1 ' day of I� t L , 2018,
by Bryan Williams, as Assistant City Manager of the CITY OF ROUND kOCK, TEXAS, a
home rule city and municipal corporation.
\`,`,Illlli��I I /
Saktlii ‘ wry.
......
:41p,RY pUB��•. '� Notary Public
. State of Texas
tr) co 1/1.r( V\lk
0, 0 F vw g Printed Name
•
71;,p\0 �
My Commission Expires: 't ' f l /2-0/0
[Signature page to Memorandum of Convention Center Operating Lease]
TENANT:
KR CC, INC.
a Delaware corps ation '
i
By: L.. / • am e Gi
ary I e : path, CFO, Se retary, and
Treasur:
ACKNOWLEDGMENT
STATE OFti39c,i711 5 §
COUNTY OF 5:2Ar---- §
tr
This instrument was acknowledged before me on the day ofr: ( , 2018,
by Mary Bonte Spath, as CFO, Secretary, and Treasurer of KR , Inc., a Biel re corporation.
"Orary Public ---?-v,GUA1
State of Wisconsin •.G�,i
My Commission: �, .ec qpf NOTARY
V :,`�i -�•�� ';
;•` PUBLIC
[Signature page to Memorandum of Convention Center Operating Lease]
Exhibit A
Leased Premises
Lot 2, Block "Cl Final Plat of Kalahari Resort and Re lat of Bertil Telander Subdivision,
recorded 4./1/.1 i as Document Number 20!$L35?' in the office of the Clerk of
Williamson County, Texas.
Exhibit A to Memorandum of Convention Center Operating Lease
Recording Requested By:
Michael Best& Friedrich LLP
One South Pinckney Street, Suite 700
Madison, Wisconsin 53703
Attention: Michael S. Green
MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND OPTION
This MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND
OPTION (this "Amendment"), dated as of j(,- 240 , 2018 is entered into between
CITY OF ROUND ROCK, TEXAS, a Texas local government home rule corporation (the
"City"), and KR CC, INC., a Delaware corporation("Tenant").
RECITALS
A. The City and Tenant entered into that certain Convention Center Operating Lease
dated t/to (the "Lease"),2018 pursuant to which the City leases to Tenant, and
Tenant leases from the City, for the Term (as such term is defined in the Lease) the real property
described in Exhibit "A" attached hereto and incorporated herein by reference (the "Leased
Premises")
B. The City and Tenant desire to execute this Memorandum to provide constructive
notice of Tenant's rights under the Lease to all third parties.
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Term. The City has agreed to lease the Leased Premises to Tenant for the Term,
which Term will end at 11:59 p.m. on December 19, 2115.
2. Lease Terms. The lease of the Leased Premises to Tenant is pursuant to the
Lease, which is incorporated into this Memorandum by reference.
3. Purchase Option. Tenant shall have the option to purchase the Leased Premises
from the City (the "Purchase Option") upon and subject to the terms and conditions set forth in
the Lease.
4. Assignment. Tenant's ability to transfer its rights under the Lease and to sublease
the Leased Premises is set forth in more detail in the Lease.
5. Leasehold Mortgagee's Right to New Agreement. Tenant's leasehold mortgagees
are granted certain rights and protections, including notice and cure rights with respect to
Tenant's defaults and the right, under certain circumstances that result in the termination of the
Lease, to require the City to enter into a new lease with Tenant's senior leasehold mortgagee or
its assignee, nominee or designee, all as set forth in more detail in the Lease.
6. Encumbrances. The Lease prohibits City from mortgaging or otherwise
encumbering City's fee title interest in the Leasehold Premises with any mortgage, deed of trust,
security deed, deed to secure debt, or any other similar instrument or agreement constituting a
lien upon, or similarly encumbering, City's fee title interest in the Leasehold Premises.
7. Successors and Assigns. This Memorandum and the Lease shall bind and inure to
the benefit of the parties and their respective heirs, successors and assigns, subject, however, to
the provisions of the Lease.
8. Governing Law. This Memorandum and the Lease are governed by Texas law.
(Signatures appear on following pages)
2
IN WITNESS WHEREOF, the City and Tenant have entered in this Memorandum as of
the day and year first above written.
CITY:
CITY OF ROUND ROCK, TEXAS
a home rule city and municipal corporation
13By: n c'L
Br aVifilliams, Assistant City
t Manager
ACKNOWLEDGMENT
STATE OF TEXAS §
COUNTY OF Williamson §
dh- .
This instrument was acknowledged before me on the'1 ' day of I� t L , 2018,
by Bryan Williams, as Assistant City Manager of the CITY OF ROUND kOCK, TEXAS, a
home rule city and municipal corporation.
\`,`,Illlli��I I /
Saktlii ‘ wry.
......
:41p,RY pUB��•. '� Notary Public
. State of Texas
tr) co 1/1.r( V\lk
0, 0 F vw g Printed Name
•
71;,p\0 �
My Commission Expires: 't ' f l /2-0/0
[Signature page to Memorandum of Convention Center Operating Lease]
TENANT:
KR CC, INC.
a Delaware corps ation '
i
By: L.. / • am e Gi
ary I e : path, CFO, Se retary, and
Treasur:
ACKNOWLEDGMENT
STATE OFti39c,i711 5 §
COUNTY OF 5:2Ar---- §
tr
This instrument was acknowledged before me on the day ofr: ( , 2018,
by Mary Bonte Spath, as CFO, Secretary, and Treasurer of KR , Inc., a Biel re corporation.
"Orary Public ---?-v,GUA1
State of Wisconsin •.G�,i
My Commission: �, .ec qpf NOTARY
V :,`�i -�•�� ';
;•` PUBLIC
[Signature page to Memorandum of Convention Center Operating Lease]
Exhibit A
Leased Premises
Lot 2, Block "Cl Final Plat of Kalahari Resort and Re lat of Bertil Telander Subdivision,
recorded 4./1/.1 i as Document Number 20!$L35?' in the office of the Clerk of
Williamson County, Texas.
Exhibit A to Memorandum of Convention Center Operating Lease
ELECTRONICALLY RECORDED 2018035599
Williamson County, Texas Total Pages: 6
Recording Requested By:
Michael Best &Friedrich LLP
One South Pinckney Street, Suite 700
Madison, Wisconsin 53703
Attention: Michael S. Green
MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND OPTION
This MEMORANDUM OF CONVENTION CENTER OPERATING LEASE AND
OPTION (this "Amendment"), dated as ofi(,� , 2018 is entered into between
CITY OF ROUND ROCK, TEXAS, a Texas local government home rule corporation (the
"City"), and KR CC, INC., a Delaware corporation("Tenant").
RECITALS
A. The City and Tenant entered into that certain Convention Center Operating Lease
dated bapj ti U, , 2018 (the "Lease"), pursuant to which the City leases to Tenant, and
Tenant leases from the City, for the Term (as such term is defined in the Lease) the real property
described in Exhibit"A" attached hereto and incorporated herein by reference (the "Leased
Premises")
B. The City and Tenant desire to execute this Memorandum to provide constructive
notice of Tenant's rights under the Lease to all third parties.
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Term. The City has agreed to lease the Leased Premises to Tenant for the Term,
which Term will end at 11:59 p.m. on December 19, 2115.
2. Lease Terms. The lease of the Leased Premises to Tenant is pursuant to the
Lease, which is incorporated into this Memorandum by reference.
3. Purchase Option. Tenant shall have the option to purchase the Leased Premises
from the City (the "Purchase Option") upon and subject to the terms and conditions set forth in
the Lease.
4. Assignment. Tenant's ability to transfer its rights under the Lease and to sublease
the Leased Premises is set forth in more detail in the Lease.
5. Leasehold Mortgagee's Right to New Agreement. Tenant's leasehold mortgagees
are granted certain rights and protections, including notice and cure rights with respect to
Tenant's defaults and the right, under certain circumstances that result in the termination of the
Lease, to require the City to enter into a new lease with Tenant's senior leasehold mortgagee or
its assignee, nominee or designee, all as set forth in more detail in the Lease.
2018035599 Page 2 of 6
6. Encumbrances. The Lease prohibits City from mortgaging or otherwise
encumbering City's fee title interest in the Leasehold Premises with any mortgage, deed of trust,
security deed, deed to secure debt, or any other similar instrument or agreement constituting a
lien upon, or similarly encumbering, City's fee title interest in the Leasehold Premises.
7. Successors and Assigns. This Memorandum and the Lease shall bind and inure to
the benefit of the parties and their respective heirs, successors and assigns, subject, however, to
the provisions of the Lease.
8. Governing Law. This Memorandum and the Lease are governed by Texas law.
(Signatures appear on following pages)
2
2018035599 Page 3 of 6
IN WITNESS WHEREOF, the City and Tenant have entered in this Memorandum as of
the day and year first above written.
CITY:
CITY OF ROUND ROCK,TEXAS
a home rule city and municipal corporation
) S'
Bryan Williams, Assistant City Manager
AC tOWLEDGMENT
STATE OF TEXAS §
COUNTY OF Williamson §
This instrument was acknowledged before me on the7.4 day of 2018,
by Bryan Williams, as Assistant City Manager of the CITY OF ROUND IZOCK, TEXAS, a
home rule city and municipal corporation.
/
®®®®® lLoplll l llf!!I/®
a P , H® ®/®
®®®® .• PU ®®.® 'tea® Notary Public
:®�® `®�' State of Texas
Ntei tvit
® • ® ®F t ® Printed Name
. ®® 126586r�' ®®`
®®®®®6 ®RES 7-11 ,.a `V\-
'®®!!rinn10i4° ®° My Commission Expires:
[Signature page to Memorandum of Convention Center Operating Lease]
2018035599 Page 4 of 6
TENANT:
' CC, INC.
a Delaware corps ation
By: , ‘ 0 i ii a
ary :ent: path, CFO, Se retary, and
Treasur
ACKNOWLEDGMENT
STATEOF t wt.( 5?mn §
§
COUNTY OF 54-- - §
L..
r
This instrument was acknowledged before me on the. 5 day of AD r; ( , 2018,
by Mary Bonte Spath, as CFO, Secretary, and Treasurer of KR Inc. a 1113e . ...re corporation.
_,-:----------
,:r.. ..i.k GUN N'N
,0 f; ary Public .--,,,T.-------.°4',
...c,1,
State of Wisconsin , . ...S'
My Commission: ;'5 ce eitp1C- ,, :' NOTARY ‘ I)
,*:
1, '... PUBLIC l'
1.5\
`i,-vA:..... ....._€., ,..
"&11*----
.., ,,
[Signature page to Memorandum of Convention Center Operating Lease]
2018035599 Page 5 of 6
Exhibit A
Leased Premises
Lot 2, Block "C" Final Plat of Kalahari Resort and Re tat of Bertil Telander Subdivision,
recorded 4./1-.Mas Document Number 2.065026in the office of the Clerk of
Williamson County, Texas.
Exhibit A to Memorandum of Convention Center Operating Lease
2018035599 Page 6 of 6
ELECTRONICALLY RECORDED
OFFICIAL PUBLIC RECORDS
2018035599
Pages: 6 Fee: $37.00
04/30/2018 08:59 AM
,
,If. i�� •I .l v ���
Nancy E. Rister,County Clerk
Williamson County,Texas