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Home My WebLink AboutResolution No. 2016-095CITY OF THE COLONY, TEXAS RESOLUTION NO. 2016- OC6 A RESOLtiTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, AUTHORIZING THE CITY MANAGER TO EXECUTE A MEMORANDUM OF UNDERSTANDING WITH WYNNWOOD ARMY, LLC, REGARDING THE OLD AMERICAN GOLF COURSE LEASE; AND PROVIDING FOR AN IMMEDIATE EFFECTIVE DATE. WHEREAS, on July 21, 1997, the City of the Colony, Texas (hereinafter referred to as the "City"), and Wynnwood Peninsula, L.P., executed a ground lease agreement concerning a parcel of land commonly referred to as Wynnwood Peninsula located within the City of The Colony, Denton County, Texas (the "Original Lease Agreement"); and WHEREAS, on or about July 20, 1998, the Original Lease Agreement was assigned to Wynnwood Army, LLC, a Texas limited liability company pursuant to a First Amendment to Ground Lease Agreement by and between the City, Wynnwood Peninsula, and Wynnwood Army, LLC; and WHEREAS, Article 4, Section 4.01(2)(C) of the Original Lease Agreement provides the following: During Lease Years sixteen (16) through the end of the term of this Lease, Lessee shall pay to Lessor an amount of rent equal to the greater of (i) annual Minimum Rent as provided for above, or (ii) annual Percentage Rent equal to two percent (2%) of Gross Revenue; and WHEREAS, the Old American Golf Club is located on approximately sixty-six percent (66%) of the Leased Premises which is subject to the Original Lease Agreement, and the remaining thirty-four percent (34%) of the Old American Golf Club is located on land owned by the Wynnwood Army, L.L.C. or related entity; and WHEREAS, the Old American Clubhouse and restaurant is not located within the Leased Premises subject to the Original Lease Agreement but is located on land owned by Wynnwood Army, L.L.C. or related entity and therefore should not be included within the Gross Revenue calculations of Article 4, Section 4.01(2)(C) of the Original Lease Agreement; and WHEREAS, the City and Wynnwood Army, L.L.C. do not desire to amend Article 4, Section 4.01(2)(C) of the Original Lease Agreement, rather the parties desire to memorialize their interpretation of Article 4, Section 4.01(2)(C) of the Original Lease Agreement with this MOli . NOW THEREFORE, BE IT RESOLVED BY THE CITY CODICIL OF THE CITY OF THE COLONY, TEXAS, THAT: SECTION 1. The findings set forth above are incorporated into the body of this Resolution as if fully set forth herein. SECTION 2. The City Council of the City of The Colony, Texas, does hereby authorize the City Manager to execute the Memorandum of Understanding regarding the Original Lease Agreement, a copy of which is attached hereto as Exhibit A. SECTION 3. This Resolution shall become effective from and after its date of passage in accordance with law. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THIS 16`' day of DECEMBER, 2016. Q G J McCo , Mayor AT ST: 71 W, CLS—tiw-wl-t Tina Stewart, TRMC, City Secretary APPROVED AS TO FORM: Page 2 pF TWZq r5�4 LU SEAL •TE X Ag [MOL'] Page 3 MEMORANDUM OF UNDERSTANDING This Memorandum of Understanding (the ` MOli") is entered into as of the 'R) day of December, 2016, by and between the CITY OF THE COLONY, TEXAS, a Texas home -rule municipality (the "City" or "Lessor") and WYNNWOOD ARMY, LLC, a Texas limited liability company (the "Lessee"), concerning the payment of rent under the Original Lease Agreement, as defined below. WHEREAS, on or about July 1, 1997, the City and Wynnwood Peninsula, L.P., a Texas limited partnership ("Wynnwood Peninsula"), entered into the Ground Lease Agreement (the "Original Lease Agreement") concerning the lease of land located on the Wynnwood Peninsula tract and containing approximately 600 acres of land; and WHEREAS, on or about July 20, 1998, the Original Lease Agreement was assigned to Wynnwood Army, LLC, a Texas limited liability company (hereinafter referred to as the "Lessee") pursuant to a First Amendment to Ground Lease Agreement by and between the City, Wynnwood Peninsula, and the Lessee (hereinafter referred to as the "First Amendment"); and WHEREAS, the City and Lessee are currently in the sixteenth (16th) year of the Original Lease Agreement; and WHEREAS, Article 4, Section 4.01(1) of the Original Lease Agreement defines the term "Minimum Rent" as Fifty Thousand and No/100 Dollars ($50,000.00) for each Lease Year commencing with the 9th Lease Year and continuing thereafter through the expiration or early termination of the Original Lease Agreement; and WHEREAS, Article 4, Section 4.01(2)(C) of the Original Lease Agreement provides the following: During Lease Years sixteen (16) through the end of the term of this Lease, Lessee shall pay to Lessor an amount of rent equal to the greater of (i) annual Minimum Rent as provided for above, or (ii) annual Percentage Rent equal to two percent (2%) of Gross Revenue; and WHEREAS, the Old American Golf Club is located on approximately sixty-six percent (66%) of the Leased Premises which is subject to the Original Lease Agreement, and the remaining thirty-four percent (34%) of the Old American Golf Club is located on land owned by the Lessee or related entity; and WHEREAS, the Old American Clubhouse and restaurant is not located within the Leased Premises subject to the Original Lease Agreement but is located on land owned by the Lessee or related entity and therefore should not be included within the Gross Revenue calculations of Article 4, Section 4.01(2)(C) of the Original Lease Agreement; and WHEREAS, the City and Lessee do not desire to amend Article 4, Section 4.01(2)(C) of the Original Lease Agreement, rather the parties desire to memorialize their interpretation of Article 4, Section 4.01(2)(C) of the Original Lease Agreement with this MOU. NOW, THEREFORE, for and in consideration of the agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City and Lessee agree as follows: SECTION 1. FINDINGS INCORPORATED. The foregoing recitals are hereby incorporated into the body of this MOU and shall be considered part of the mutual covenants, consideration and promises that bind the parties. SECTION 2. ADMINISTRATIVE INTERPRETATION OF ORIGINAL LEASE AGREEMENT. The City and Lessee agree that the phrase "two percent (2%) of Gross Revenues" contained in Article 4, Section 4.01(2)(C)(ii) of the Original Lease Agreement, specifically as applied to the Gross Revenues from the Old American Golf Club operations, shall be interpreted to mean two percent (2%) of Gross Revenues less food and beverage revenues multiplied by sixty-six percent (66%). For further clarity, this specific payment formula would be 0.02 x (Gross Revenues from OAGC — OAGC F&B) x 0.66. All other Gross Revenue payments due to the City remain unchanged. SECTION 3. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this MOU: (a) Counterparts. This MOU may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute one and the same document. (b) Effective Date. The effective date (the "Effective Date") of this MOL' shall be the date of the latter to execute this MOU by and between the City and Lessee. [The Remainder of this Page Intentionally Left Blank] IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly executed. ?%0 LU 'C• SEAL 4— ;• s TEX A'S EST: 91AqG* Tina Stewart, City Secretary APPROVED AS TO FORM: Jeff Moore, C)ty Attorney CITY: CITY OF THE COLONY, TEXAS, A Texas home -rule municipality By: Tr ell, City Manager Date:_ �-� - LESSEE: WYN, WOOD ARMY, LLC, A Texas limited liability company, Name: IZAx MA74 / Zce Title: Date: f w [ 2, Ze-G