HomeMy WebLinkAboutCity Packets - City Council - 11/19/2024 - RegularAgenda Item No:1.5
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Latonjia Williams
Submitting Department: Finance
Item Type: Announcement
Agenda Section:
Subject:
Presentation acknowledging the Finance Department for being awarded the Government Finance Officers
Association Certificate of Achievement in Financial Reporting. (L. Williams)
Suggested Action:
Attachments:
5
Agenda Item No:1.6
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Kimberly Thompson
Submitting Department: City Secretary
Item Type: Miscellaneous
Agenda Section:
Subject:
Items of Community Interest
Suggested Action:
Attachments:
6
Agenda Item No:1.7
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Megan Charters
Submitting Department: Library
Item Type: Announcement
Agenda Section:
Subject:
Receive presentation from the Library regarding upcoming events and activities. (Charters)
Suggested Action:
Attachments:
7
Agenda Item No:2.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Tina Stewart
Submitting Department: City Secretary
Item Type: Ordinance
Agenda Section:
Subject:
Discuss and consider approving an ordinance canvassing the returns and declaring the results of an election
held on Tuesday, November 5, 2024, for the purpose of electing three (3) councilmembers for said city;
providing the candidate for Mayor, Place 1 and Place 2 elected to office. (Council)
Suggested Action:
Attachments:
Ord. 2024 Canvassing - November 2024 General Election DRAFT.doc
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CITY OF THE COLONY, TEXAS
ORDINANCE NO.2024 - __________
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, CANVASSING AND CERTIFYING THE ELECTION
RETURNS, INCLUDING THE RETURNS OF EARLY VOTING
BALLOTS CAST IN CONNECTION WITH THE GENERAL ELECTION
HELD ON TUESDAY, NOVEMBER 5, 2024, TO ELECT ONE (1) CITY
COUNCIL MEMBER TO PLACE 1, TO A THREE (3) YEAR TERM OF
OFFICE; TO ELECT ONE (1) CITY COUNCIL MEMBER TO PLACE 2,
TO A THREE (3) YEAR TERM OF OFFICE; TO ELECT ONE (1)
MAYOR, TO A THREE (3) YEAR TERM OF OFFICE; PROVIDING FOR
AN IMMEDIATE EFFECTIVE DATE.
WHEREAS,the City Council for the City of The Colony, Texas (hereinafter referred to as
the “City”) ordered a General Election to be held on Tuesday, November 5, 2024, for the purpose of
electing one (1) Council Member for Place 1, one (1) Council Member for Place 2, and one (1)
Mayor, each for a three (3) year term of office (hereinafter referred to as the “Election”); and
WHEREAS,the appropriate authority of the City caused to be posted and published, in
accordance with applicable laws, notices for the Election; and
WHEREAS,the Election was duly and legally held on Tuesday, November 5, 2024, in the
City, with _______valid and legal ballots cast, and in conformity with the City’s Home-Rule
Charter, and the election laws of the State of Texas, and the results of the Election, including early
voting results, have been delivered by the presiding election judge in accordance with law and have
been delivered to the City Council as the canvassing authority in accordance with law; and
WHEREAS,the City Council for the City of The Colony, Texas, does hereby canvass the
returns of the Election set forth herein, and in accordance with law and takes such other actions
regarding the results of the said Election as set forth herein.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS:
SECTION 1. The findings set forth above are incorporated into the body of this Ordinance
as if fully set forth herein.
SECTION 2. Canvass of General Election.
(a)The returns of the General Election, including the returns of early voting ballots, duly
and legally made, showed that there were for the general election of officers held on Tuesday,
November 5, 2024, the following votes:
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Page 2
Council Member, Place 1 (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
Council Member, Place 2 (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
Mayor (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
(b)In accordance with Article XI, Section 11 of the Texas Constitution, candidates for
Council Member Place 1, Council Member Place 2, and Mayor, who receive a majority of all
votes cast for each of the respective offices shall be declared elected.
(c)That pursuant to the applicable provisions of the Texas Local Government Code, and
Texas Election Code, the City Council of the City of The Colony, Texas, officially finds and
determines and hereby declares the results of said election to be that:
(1)___________ is hereby elected by a majority vote of the voters city wide as
Councilmember in Place 1 to a three (3) year term of office, until November 2027;
(2)___________ is hereby elected by a majority vote of the voters city wide as
Councilmember in Place 2 to a three (3) year term of office, until November 2027;
(1)___________ is hereby elected by a majority vote of the voters city wide as
Mayor to a three (3) year term of office, until November 2027;
SECTION 3. This Ordinance shall become effective from and after its date of passage in
accordance with law.
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Page 3
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS THE 19
TH DAY OF NOVEMBER 2024.
Richard Boyer, Mayor, City of The Colony
ATTEST:
Tina Stewart, City Secretary, TRMC, CMC
11
Agenda Item No:3.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Tina Stewart
Submitting Department: City Secretary
Item Type: Miscellaneous
Agenda Section:
Subject:
Oath of Office for elected City Council members of Mayor, Place 1 and Place 2. (Stewart)
Suggested Action:
Attachments:
Ord. 2024 Canvassing - November 2024 General Election DRAFT.doc
12
CITY OF THE COLONY, TEXAS
ORDINANCE NO.2024 - __________
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, CANVASSING AND CERTIFYING THE ELECTION
RETURNS, INCLUDING THE RETURNS OF EARLY VOTING
BALLOTS CAST IN CONNECTION WITH THE GENERAL ELECTION
HELD ON TUESDAY, NOVEMBER 5, 2024, TO ELECT ONE (1) CITY
COUNCIL MEMBER TO PLACE 1, TO A THREE (3) YEAR TERM OF
OFFICE; TO ELECT ONE (1) CITY COUNCIL MEMBER TO PLACE 2,
TO A THREE (3) YEAR TERM OF OFFICE; TO ELECT ONE (1)
MAYOR, TO A THREE (3) YEAR TERM OF OFFICE; PROVIDING FOR
AN IMMEDIATE EFFECTIVE DATE.
WHEREAS,the City Council for the City of The Colony, Texas (hereinafter referred to as
the “City”) ordered a General Election to be held on Tuesday, November 5, 2024, for the purpose of
electing one (1) Council Member for Place 1, one (1) Council Member for Place 2, and one (1)
Mayor, each for a three (3) year term of office (hereinafter referred to as the “Election”); and
WHEREAS,the appropriate authority of the City caused to be posted and published, in
accordance with applicable laws, notices for the Election; and
WHEREAS,the Election was duly and legally held on Tuesday, November 5, 2024, in the
City, with _______valid and legal ballots cast, and in conformity with the City’s Home-Rule
Charter, and the election laws of the State of Texas, and the results of the Election, including early
voting results, have been delivered by the presiding election judge in accordance with law and have
been delivered to the City Council as the canvassing authority in accordance with law; and
WHEREAS,the City Council for the City of The Colony, Texas, does hereby canvass the
returns of the Election set forth herein, and in accordance with law and takes such other actions
regarding the results of the said Election as set forth herein.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS:
SECTION 1. The findings set forth above are incorporated into the body of this Ordinance
as if fully set forth herein.
SECTION 2. Canvass of General Election.
(a)The returns of the General Election, including the returns of early voting ballots, duly
and legally made, showed that there were for the general election of officers held on Tuesday,
November 5, 2024, the following votes:
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Page 2
Council Member, Place 1 (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
Council Member, Place 2 (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
Mayor (Three Year Term)
Name of Candidate Total Number of Total Number of Votes Total Number
Early Voting Votes on November 5, 2024 of Votes
(b)In accordance with Article XI, Section 11 of the Texas Constitution, candidates for
Council Member Place 1, Council Member Place 2, and Mayor, who receive a majority of all
votes cast for each of the respective offices shall be declared elected.
(c)That pursuant to the applicable provisions of the Texas Local Government Code, and
Texas Election Code, the City Council of the City of The Colony, Texas, officially finds and
determines and hereby declares the results of said election to be that:
(1)___________ is hereby elected by a majority vote of the voters city wide as
Councilmember in Place 1 to a three (3) year term of office, until November 2027;
(2)___________ is hereby elected by a majority vote of the voters city wide as
Councilmember in Place 2 to a three (3) year term of office, until November 2027;
(1)___________ is hereby elected by a majority vote of the voters city wide as
Mayor to a three (3) year term of office, until November 2027;
SECTION 3. This Ordinance shall become effective from and after its date of passage in
accordance with law.
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PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS THE 19
TH DAY OF NOVEMBER 2024.
Richard Boyer, Mayor, City of The Colony
ATTEST:
Tina Stewart, City Secretary, TRMC, CMC
15
Agenda Item No:5.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Kimberly Thompson
Submitting Department: City Secretary
Item Type: Discussion
Agenda Section:
Subject:
Council to provide direction to staff regarding future agenda items. (Council)
Suggested Action:
Attachments:
16
Agenda Item No:6.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Kimberly Thompson
Submitting Department: City Secretary
Item Type: Minutes
Agenda Section:
Subject:
Consider approving City Council Regular Session meeting minutes from November 6, 2024. (Stewart)
Suggested Action:
Attachments:
November 6, 2024 DRAFT Minutes.docx
17
1 These items are strictly public service announcements. Expressions of thanks, congratulations or condolences; information
regarding holiday schedules; honorary recognition of city officials, employees or other citizens; reminders about upcoming
events sponsored by the City or other entity that are scheduled to be attended by a city official or city employee. No action
will be taken and no direction will be given regarding these items.
MINUTES OF THE CITY COUNCIL REGULAR SESSION
HELD ON
NOVEMBER 6, 2024
The Regular Session of the City Council of the City of The Colony, Texas, was called to order
at 6:33 p.m. on the 6
th day of November 2024, at City Hall, 6800 Main Street, The Colony,
Texas, with the following roll call:
Richard Boyer, Mayor
Judy Ensweiler, Deputy Mayor Pro Tem
Robyn Holtz, Councilmember
Brian Wade, Councilmember
Dan Rainey, Councilmember
Perry Schrag, Mayor Pro Tem
Joel Marks, Councilmember
Present
Present
Present
Present
Present
Present
Present
And with 7 councilmembers present a quorum was established and the following items were
addressed:
1.0 ROUTINE ANNOUNCEMENTS, RECOGNITIONS and PROCLAMATIONS
1.1 Call to Order
Mayor Boyer called the meeting to order at 6:33 p.m.
1.2 Invocation
Bishop Kevin Burke with The Church of Jesus Christ of Latter-Day Saints delivered
the invocation.
1.3 Pledge of Allegiance to the United States Flag
The Pledge of Allegiance to the United States Flag was recited.
1.4 Salute to the Texas Flag
Salute to the Texas Flag was recited.
1.5 Items of Community Interest
1.5.1 Receive presentation from Parks and Recreation regarding upcoming events and
activities.
Special Events Supervisor, Chloe Hancock, provided upcoming events and
activities to the Council.
Councilmembers Wade and Marks arrived at 6:37 p.m.
2.0 CITIZEN INPUT
None.
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City Council – Regular Meeting Agenda
November 6, 2024
Page| 2
3.0 WORK SESSION
3.1 Council to provide direction to staff regarding future agenda items.
Mayor requested to discuss the formation of a Charter Review Committee in 2025
at the first meeting in December.
Councilmember Marks suggested revisiting the sign ordinance at the next meeting.
4.0 CONSENT AGENDA
Motion to approve all items from the ConsentAgenda - Schrag; second byWade,motion carried
with all ayes.
4.1 Consider approving City Council Regular meeting minutes from October 15, 2024.
4.2 Consider approving a resolution authorizing the City Manager to issue a purchase
order to the City of Plano for the operations of the PAWM Radio System in the
amount of $121,000.00.
RESOLUTION NO. 2024-081
4.3 Consider approving a resolution authorizing the City Manager to issue a purchase
order to Medical City of Plano to provide EMS Medical Control Direction for The
Colony Fire Department for $65,220.00.
RESOLUTION NO. 2024-082
4.4 Consider approving a resolution authorizing the City Manager to issue a purchase
order to Bureau Veritas North America in the amount of $75,000.00 for health plan
review and inspections.
RESOLUTION NO. 2024-083
4.5 Consider approving an ordinance to allow an exception to the Code of Ordinance
Section 6-192, (a) & (b) to allow for a benefit concert until 11:00 p.m. on November
21, 2024 at TopGolf, 3760 Blair Oaks Drive.
ORDINANCE NO. 2024-2581
4.6 Consider approving a resolution authorizing the City Manager to issue a purchase
order to Polydyne Inc. in the amount of $120,000.00 for the purchase of Clarifloc
for the treatment of wastewater.
RESOLUTION NO. 2024-084
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City Council – Regular Meeting Agenda
November 6, 2024
Page| 3
4.7 Consider approving a resolution authorizing the City Manager to issue a purchase
order to PVS Technologies in the amount of $80,000.00 for the purchase of Ferric
Chloride Solution for the treatment of wastewater.
RESOLUTION NO. 2024-085
4.8 Consider approving a resolution authorizing the City Manager to issue a purchase
order to the Camelot Landfill in the amount of $300,000.00 for the disposal of solid
waste from the Wastewater Treatment Plant.
RESOLUTION NO. 2024-086
4.9 Consider approving a resolution authorizing the City Manager to issue a purchase
order to H & H Concrete On Demand in the amount of $450,000.00 for the purchase
of concrete, flow-fill, and site-mix for sidewalk, alley, street, curb and gutter
repairs.
RESOLUTION NO. 2024-087
4.10 Consider approving a resolution authorizing the City Manager to execute an
Engineering Services Contract in the amount of $ 64,780.00 with Halff Associates,
Inc. to prepare construction plans and specifications for the Arbor Glen Road
Concrete Pavement Repairs project.
RESOLUTION NO. 2024-088
4.11 Consider approving a resolution authorizing the Mayor to execute an Interlocal
Cooperation Agreement with Denton County for engineering and construction
services for the widening of Memorial Drive as a six-lane roadway between
Standridge Drive and the eastern City limits.
RESOLUTION NO. 2024-089
4.12 Consider approving a resolution authorizing the City Manager to sign an
Engineering Services Contract in the amount of $ 337,700.00 with Quiddity
Engineering, LLC. to prepare construction plans and specifications for the Phase
15A Residential Street Reconstruction project.
RESOLUTION NO. 2024-090
4.13 Consider approving a resolution authorizing the City Manager to execute an
Engineering Services Contract in the amount of $ 330,230.00 with Halff
20
City Council – Regular Meeting Agenda
November 6, 2024
Page| 4
Associates, Inc. to prepare construction plans and specifications for the Phase 15B
Residential Street Reconstruction project.
RESOLUTION NO. 2024-091
5.0 REGULAR AGENDA ITEMS
5.1 Conduct a public hearing, discuss and consider an ordinance regarding amendments
to Planned Development -18 (PD-18) District aka The Tribute, by modifying
Exhibit B “Development Regulations for PD-18 and PD-23,” updating the Concept
Plan illustration, and providing development standards for the “Adeline at The
Tribute” consisting of sixty (60) residential lots and eight (8) common areas located
west of Lebanon Road and South of Bridge Lane within Planned Development 18
(PD18).
Planning Director,Isaac Williams,presented the proposed ordinance amendments.
The public hearing was opened and closed at 6:49 p.m. with no speakers.
Motion to approve-Schrag; second by Rainey, motion carried with all ayes.
ORDINANCE NO. 2024-2582
5.2 Conduct a public hearing, discuss and consider an ordinance regarding a zoning
change from Planned Development 11 (PD11) to Planned Development 29 (PD29)
aka “JumpShot” to establish conceptual layout for an Amusement, Commercial
(indoor) Use and development standards approximately 8.69 acres located
approximately 330 feet west of the southwest intersection of Memorial Drive and
Blair Oaks Drive.
Planning Director, Isaac Williams, presented the proposed ordinance to Council.
The public hearing was opened at 6:58 and closed at 7:16 p.m. JumpShot
Representatives, Jonathan Kerby, 2600 N. Central Expressway, Richardson, Texas
and Brian Birchbichler, 2016 Magic Mantle, appeared in support of the item and
give clarity to the Council. Jeff Harkinson, 5109 Palomar Lane, Dallas, Texas,
appeared in support of the item. Council provided discussion on this item.
Motion to approve –Ensweiler; second by Wade, motion carried with all ayes.
ORDINANCE NO. 2024-2583
5.3 [CONTINUED FROM 10/15/2024]Conduct a public hearing, discuss and
consider an ordinance regarding the approval of a Specific Use Permit (SUP) to
allow a laboratory with scientific testing and administrative office known as
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City Council – Regular Meeting Agenda
November 6, 2024
Page| 5
“Devansh Lab Werks,” located at 6600 Paige Road Suite 100 and Suite 111, within
the Office 1 (O-1) Zoning District and Gateway Overlay District.
Motion to continue public hearing and action to November 19, 2024- Ensweiler; second by
Wade, motion carried with all ayes.
5.4 Discuss and consider approving a resolution authorizing the City Manager to
execute a Professional Services Agreement for a Construction Manager at Risk with
PCL Construction Inc. for the preconstruction services for the Stewart Creek
WWTP Expansion Phase II B to 6.3 MGD project in an amount not to exceed
$6,165,673.00.
Public Works Director, James Whitt, introduced Representative, Troy Lehmann, to
provide an overview to Council. Council provided discussion on the item.
Motion to approve –Ensweiler; second by Rainey, motion carried with all ayes.
RESOLUTION NO. 2024-092
5.5 Discuss and consider adopting an ordinance regarding solicitation and handbill
distribution.
Deputy City Manager, Joe Perez, presented this item to Council. City Attorney,
Jeff Moore, clarified the codes for it.
Motion to approve– Rainey; second by Wade, motion carried with all ayes.
ORDINANCE NO. 2024-2584
5.6 Discuss and consider approving a resolution authorizing the City Manager to issue
a purchase order to Metro Fire Apparatus Specialists, Inc. in the amount of
$1,505,140.00 for the purchase of a Spartan/SVI Wet Rescue Fire Apparatus.
Fire Chief, Scott Thompson, presented this item to Council.
Motion to approve– Schrag; second by Holtz, motion carried with all ayes.
RESOLUTION NO. 2024-093
5.7 Discuss and consider approving a resolution authorizing the City Manager to
execute a Construction Services Contract in the amount of $4,063,160.00 with
Quality Excavation, LLC for the Phase 14A Residential Street Reconstruction
Project.
Director of Engineering, Ron Hartline, gave an overview of this item. Council
provided discussion on it.
Motion to approve– Wade; second by Ensweiler, motion carried with all ayes.
22
City Council – Regular Meeting Agenda
November 6, 2024
Page| 6
RESOLUTION NO. 2024-094
5.8 Discuss and consider approving a resolution authorizing the City Manager to
execute a Construction Services Contract in the amount of $596,776.18 with Road
Solutions, LLC. to construct a Traffic Signal at the new City Hall entrance located
at the FM 423/ Nash Drive Intersection.
Director of Engineering, Ron Hartline, presented the proposed resolution to
Council.
Motion to approve– Wade; second by Marks, motion carried with all ayes.
RESOLUTION NO. 2024-095
5.9 Discuss and consider approving a resolution reappointing Jeremie Maurina as the
City's representative and appointing a representative as alternate on the Denton
County Transportation Authority Board.
Motion to approve the reappointment of Jeremie Maurina and appointment of Joe Perez as an
alternate– Ensweiler; second by Marks, motion carried with all ayes.
RESOLUTION NO. 2024-096
5.10 Discuss and consider approving a resolution reappointing Jeremie Maurina as the
City's representative and appointing a representative as alternate on the Denton
County Transportation Authority Board.
Councilmember Schrag made the motion to cast 50% of the votes for Mike Hennefer and 36%
for Rob Altman– motion carried with all ayes.
RESOLUTION NO. 2024-097
Executive Session was convened at 8:05 p.m.
6.0 EXECUTIVE SESSION
6.1 A. Council shall convene into a closed executive session pursuant to Sections
551.072 and 551.087 of the Texas Government Code to deliberate regarding
purchase, exchange, lease or value of real property and commercial or financial
information the city has received from a business prospect(s), and to deliberate the
offer of a financial or other incentive to a business prospect(s).
B. Council shall convene into a closed executive session pursuant to Section
551.074 of the Texas Government Code to deliberate the evaluation, reassignment,
duties, discipline, or dismissal of the City Manager.
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City Council – Regular Meeting Agenda
November 6, 2024
Page| 7
Regular Session was reconvened at 8:48 p.m.
7.0 EXECUTIVE SESSION ACTION
7.1 A. Any action as a result of executive session regarding purchase, exchange, lease
or value of real property and commercial or financial information the city has
received from a business prospect(s), and the offer of a financial or other incentive
to a business prospect(s).
No Action
B. Any action as a result of executive session regarding the evaluation,
reassignment, duties, discipline, or dismissal of the City Manager.
No Action
ADJOURNMENT
With there being no further business to discuss, the meeting adjourned at 8:48 p.m.
APPROVED:
__________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
_____________________________________
Tina Stewart, City Secretary
24
Agenda Item No:6.2
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Jay Goodson
Submitting Department: Police
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to issue a purchase order to Reliable Chevrolet in
the amount of $304,670.00 for the replacement of police vehicles through Sheriffs Association of Texas
Contract #25-06-1010. (Goodson)
Suggested Action:
Attachments:
Res. 2024-xxx Reliable Chevrolet.docx
25
CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO ISSUE A PURCHASE ORDER TO
RELIABLE CHEVROLET FOR THE REPLACEMENT OF POLICE VEHICLES
THROUGH SHERIFFS ASSOCIATION OF TEXAS CONTRACT #25-06-1010; AND
PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to issue a purchase order to Reliable Chevrolet in the amount of $304,670.00 for the
replacement of police vehicles through Sheriffs Association of Texas Contract #25-06-1010.
Section 2. That the City Manager and/or his designee are authorized to issue said purchase
order.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
26
Agenda Item No:6.3
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Jason Bonds
Submitting Department: Fire
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to issue a purchase order to Rush Truck Center
in the amount of $165,645.00 for the purchase of three (3) F150 Pick Up trucks. (Thompson)
Suggested Action:
Two (2) of the trucks will be replacing two (2) 2016 Chevy Tahoe's which will be added to reserve status and
are used for administrative staff. The third truck will be issued to the newly created position of Division Chief of
Training
Attachments:
F150 Interceptor.pdf
Res. 2024-xxx Rush Truck Center.docx
27
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35
CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO ISSUE A PURCHASE ORDER TO RUSH
TRUCK CENTER FOR THE PURCHASE OF THREE (3) F150 PICKUP TRUCKS; AND
PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to issue a purchase order to Rush Truck Center in the amount of $165,645.00 for the
purchase of three (3) F150 Pickup trucks.
Section 2. That the City Manager and/or his designee are authorized to issue said purchase
order.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
36
Agenda Item No:6.4
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Jackie Kopsa
Submitting Department: Parks & Recreation
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to execute a Ground Sublease Agreement
between Wynwood Army, LLC and Argo SMI Tribute, LLC and a Consent to Ground Sublease Agreement and
Non-Disturbance Agreement among Wynwood Army, LLC, Argo SMI Tribute, LLC, and the City. (Kopsa)
Suggested Action:
Since last reviewed by the City, Matthews Southwest has made some revisions to the Ground Sublease
Agreement, which include (a) replacing Tribute Marina SMI, LLC with Argo SMI Tribute, LLC as the proper
Sublessee entity; (b) inserting language in Sections 12.4-12.6 to allow Sublessee’s lender to perfect its security
interest in the Ground Sublease Agreement; and (c) making Sublessor’s failure to comply with the ground
leases a default under the Ground Sublease Agreement in Section 14.5. In addition to the final documents,
attached is a redline of the attached Ground Sublease Agreement to review against the version last reviewed.
The Consent to Ground Sublease Agreement and Non-Disturbance Agreement is new and was drafted off of
the Consent and NDA provided by Suntex and approved by the City for Hidden Cove Marina. In the redline
attached, you can see that the only changes made from the Consent and NDA for Hidden Cove Marina were to:
(a) incorporate the proper parties; (b) time stamp the estoppels in Sections 3-4 to “as of the Effective Date”;
and (c) remove the representations and warranties related to marina improvements under the Wynwood
Sublease in Section 6, since there are no such obligations under the Wynwood Sublease.
Attachments:
Tribute - City Consent to Ground Sublease Agreement and Non-Disturbance Agreement-c.pdf
Redline - City Consent to Ground Sublease Agreement and Non-Disturbance Agreement - 10_23_24-c.pdf
Tribute - Ground Sublease Agreement-c.pdf
Redline - Ground Sublease Agreement - 10_23_24-c.pdf
Res. 2024-xxx Sublease Agreements.docx
37
AFTER RECORDING RETURN TO:
_____________________
_____________________
_____________________
_____________________
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY
INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS
FILED FOR RECORD IN PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR
DRIVER’S LICENSE NUMBER.
THE STATE OF TEXAS §
§
COUNTY OF DENTON §
CONSENT TO GROUND SUBLEASE AGREEMENT
AND NON-DISTURBANCE AGREEMENT
THIS CONSENT TO GROUND SUBLEASE AGREEMENT (this “Consent”) dated as of this
____ day of ______________, 202__ (the “Effective Date”), is executed by The City of The Colony, Texas
(together with its permitted successors and assigns, the “City”), Wynwood Army, LLC, a Texas limited
liability company (together with its permitted successors and assigns, “Wynwood”), and Argo SMI Tribute,
LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Tribute”).
Recitals
A. The United States Secretary of the Army (the “Corps”), as lessor, and the City, as lessee,
executed and entered into that certain Lease No. DACW63-1-08-0613 dated as of June 9, 2008 (as amended,
the “Underlying Lease”), concerning certain real property as more fully described in the Underlying Lease.
B. The City, as sublessor, and Wynwood, as sublessee, executed and entered into that certain
Ground Lease Agreement dated as of July 21, 1997 (as amended, the “Wynwood Sublease”), concerning
certain real property as more fully described in the Wynwood Sublease.
C. Wynwood, as sublandlord, and Tribute, as sublessee, executed and entered into that certain
Ground Sublease Agreement dated as of ____________, 202___ (as amended, restated, replaced,
supplemented or otherwise modified from time to time, the “Tribute Sublease”) concerning certain real
property and water area over submerged real property as set forth in Exhibit “A” (the “Tribute Subleased
Premises”).
1. Defined Terms. Unless otherwise defined in this Consent, each defined term used in this
Consent shall have the same meaning given to such term in the Tribute Sublease.
2. Consent to Sublease. The City hereby consents to Tribute subleasing the Tribute Subleased
Premises from Wynwood pursuant to the terms and conditions of the Tribute Sublease. The City further
consents to any Leasehold Mortgagee acquiring the Tribute Subleased Premises from Tribute in accordance
with the terms of the Tribute Sublease and agrees that the Tribute Subleased Premises may be assigned in
accordance with the terms of the Tribute Sublease.
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3. City’s Representations and Warranties. The City hereby represents and warrants to Tribute
as of the Effective Date that, to the City’s current actual knowledge, (a) the Wynwood Sublease is in full
force and effect; (b) neither the City nor Wynwood is in default under the Wynwood Sublease; (c) the
Underlying Lease is in full force and effect; and (d) neither the City nor the Corps is in default under the
Underlying Lease.
4. Wynwood’s Representations and Warranties. Wynwood hereby represents and warrants to
Tribute as of the Effective Date that, to Wynwood’s current actual knowledge, (a) the Wynwood Sublease
is in full force and effect; (b) the Wynwood Sublease has not been assigned, encumbered, modified,
extended or supplemented; and (c) neither Wynwood nor the City is in default under the Wynwood
Sublease.
5. Tribute’s Cure Rights.
(a) The City agrees to provide Tribute with copies of all notices of default and any
notice of termination given by the Corps to the City under the Underlying Lease within twenty (20)
days of receipt by the City of such notice and, in any event, with sufficient advance notice to Tribute
to provide Tribute with a reasonable period of time to cure such default. Tribute and any Leasehold
Mortgagee, at each of their option and in their sole discretion, shall be permitted to cure any of the
City’s defaults under the Underlying Lease, in which event the City shall be liable for and obligated
to repay Tribute or its Leasehold Mortgagee for all of the costs incurred by Tribute or its Leasehold
Mortgagee in curing such default of the City under the Underlying Lease; provided, however, that
the City is only able to provide Tribute and its Leasehold Mortgagee with the same cure period as
the City has under the Underlying Lease (which cure periods shall run concurrently), and any
extension of such cure period shall be in the Corps’ discretion. Tribute and its Leasehold
Mortgagee’s right to cure defaults is for the full protection of Tribute and its Leasehold Mortgagee
and the existence of this right shall not release the City from the obligation to perform all of its
obligations under the Underlying Lease or deprive Tribute or its Leasehold Mortgagee of any other
right which Tribute or its Leasehold Mortgagee may have by reason of such default by the City.
(b) The City and Wynwood agree to provide Tribute with copies of all notices of
default and any notice of termination given by the City to Wynwood under the Wynwood Sublease
concurrently with the delivery of (or receipt of, as applicable) such notice. Tribute and its
Leasehold Mortgagee, at their option and in their sole discretion, shall be permitted to cure any of
Wynwood’s defaults under the Wynwood Sublease, in which event Wynwood shall be liable for
and obligated to repay Tribute or its Leasehold Mortgagee for all of the costs incurred by Tribute
or its Leasehold Mortgagee in curing such default of Wynwood under the Wynwood Sublease;
provided, however, that Tribute or its Leasehold Mortgagee must cure Wynwood’s default under
the Wynwood Sublease within the same cure period as Wynwood has under the Wynwood Sublease
(which cure periods shall run concurrently). Tribute and its Leasehold Mortgagee’s right to cure
defaults is for the full protection of Tribute and its Leasehold Mortgagee and the existence of this
right shall not release Wynwood from the obligation to perform all of its obligations under the
Wynwood Sublease or deprive Tribute or its Leasehold Mortgagee of any other right which Tribute
or its Leasehold Mortgagee may have by reason of such default by Wynwood.
6. Estoppel. By executing this Consent, Wynwood hereby ratifies, confirms and approves the
Wynwood Sublease. Wynwood represents and warrants to Tribute, as of the Effective Date, that, to
Wynwood’s current actual knowledge, (a) the City is not in default of its obligations under the Wynwood
Sublease; and (b) no event has occurred or failed to occur that with the passage of time, the giving of notice
or both would constitute a default or breach by the City or Wynwood of their respective obligations and
liabilities under the Wynwood Sublease. To Wynwood’s current actual knowledge, Wynwood is not
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entitled to any refunds, rebates, offsets or credits with respect to any amounts heretofore paid by Wynwood
under the Wynwood Sublease. To Wynwood’s current actual knowledge, Wynwood has no claim,
counterclaim or other defense to the payment of rent or other amounts due or to become due under the
Wynwood Sublease or the performance of any of Wynwood’s other obligations under the Wynwood
Sublease. As of the Effective Date, Wynwood has not assigned the Tribute Sublease, in whole or in part,
nor has Wynwood assigned any of its rights, title or interests in the Tribute Sublease, and Wynwood has
not subleased the Tribute Subleased Premises or any part thereof.
7. Non-Disturbance and Attornment. The City agrees that during the term of the Tribute
Sublease, including any extended term thereof, Tribute’s rights under the Tribute Sublease and Tribute’s
possession of the Tribute Subleased Premises shall not be disturbed, modified, enlarged, or otherwise
affected, and Tribute’s rights and privileges under the Tribute Sublease shall not be diminished or interfered
with by the City upon any exercise of its rights (including any proceeding to foreclose) under the Underlying
Lease or the Wynwood Sublease, and the City will not join Tribute as a party defendant in any proceeding
resulting from a default by the City or Wynwood under the Underlying Lease or the Wynwood Sublease.
In the event that the City exercises any of its remedies in the event of a default by Wynwood or any other
rights, as provided for in the Underlying Lease or Wynwood Sublease, or in the event the Wynwood
Sublease is terminated by reason of rejection of the Wynwood Sublease in any bankruptcy case without the
prior written consent of Tribute and any Leasehold Mortgagee, the Tribute Sublease shall not be terminated
or affected by the default or action of the City or Wynwood, or all. Tribute covenants and agrees to attorn
to the City, as its new landlord if Wynwood’s rights under the Wynwood Sublease are terminated, and the
Tribute Sublease shall continue in full force and effect as a direct lease between the City and Tribute, or
upon written request of Tribute at the time of termination by City, the City agrees to enter into a new lease
of the Tribute Subleased Premises with Tribute, provided that the City has received consents necessary
from the Corps in accordance with the Underlying Lease. The new lease shall be effective as of the date of
termination or rejection of the Wynwood Sublease and be on substantially the same terms and conditions
as the Tribute Sublease (including, without limitation, any rights or options to extend the term of the Tribute
Sublease) and shall not materially expand or reduce the rights or obligations of the landlord or tenant
thereunder. Tribute shall not be liable for or otherwise be required to cure any defaults which are personal
to Wynwood (such as, for example, any default arising by virtue of any bankruptcy, insolvency or
dissolution of Wynwood). The City’s obligation to enter into the new lease shall be conditioned upon
Tribute having cured all monetary defaults under the Wynwood Sublease relating to rental payments or the
physical upkeep and maintenance of the Tribute Subleased Premises. The new lease shall be superior to
all rights, liens and interests granted at any time on the City’s leasehold interest in the Tribute Subleased
Premises and to all rights, liens and interests intervening between the date of the Tribute Sublease and the
granting of the new lease. Notwithstanding anything to the contrary contained in this Consent, Tribute shall
not interfere with or attempt to diminish in any way Wynwood’s rights and privileges under the Wynwood
Sublease or any other agreements between the City and Wynwood.
8. Not an Amendment to Wynwood Sublease. This Consent does not constitute, and shall not
be deemed, construed or held to be, an amendment or modification of the Wynwood Sublease. During the
term of the Underlying Lease, the City shall be prohibited from (a) amending the Underlying Lease in any
way that will increase the liabilities or obligations of Tribute under the Tribute Sublease or this Consent or
otherwise reduce the rights of Tribute with respect to the Tribute Subleased Premises or its use thereof; or
(b) voluntarily agreeing to terminate the Underlying Lease prior to its natural expiration thereof unless such
termination arises from a casualty or condemnation, which casualty or condemnation, by itself, results in
the termination of the Tribute Sublease. During the term of the Wynwood Sublease, the City and Wynwood
shall be prohibited from (a) amending the Wynwood Sublease in any way that will increase the liabilities
or obligations of Tribute under the Tribute Sublease or this Consent or otherwise reduce the rights of Tribute
with respect to the Tribute Subleased Premises or its use thereof; or (b) voluntarily agreeing to terminate
the Wynwood Sublease prior to its natural expiration thereof unless such termination arises from a casualty
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4
or condemnation, which casualty or condemnation, by itself, results in the termination of the Tribute
Sublease.
9. Amendment. This Consent constitutes the entire agreement of the parties with respect to
the subject matter contained herein. This Consent cannot be modified or amended except in writing
executed by the City, Wynwood, and Tribute.
10. Authority. Each party executing this Consent on behalf of a party hereto represents and
warrants to the other party hereto that the agent, partner or officer executing this Consent on the representing
party’s behalf is fully authorized, directed and empowered to execute and deliver this Consent in such
capacity as the act and deed of the party on whose behalf he or she is executing this Consent and that all
corporate or company action requisite to such execution and delivery has been taken by such party.
11. Governing Law. This Consent shall be governed by and construed and enforced in
accordance with the laws of the State of Texas.
12. Counterparts. This Consent may be executed in counterparts, and each counterpart when
fully executed and delivered by the parties hereto will be an original instrument, but all such counterparts
will constitute one agreement.
[Signature Page(s) to Follow]
41
Executed and effective as of the Effective Date.
CITY: The City of The Colony, Texas
By: ______________________________
Name: ______________________________
Its: ______________________________
WYNWOOD: Wynwood Army, LLC,
a Texas limited liability company
By: ______________________________
Name: ______________________________
Its: ______________________________
TRIBUTE: Argo SMI Tribute, LLC,
a Delaware limited liability company
By: ______________________________
Name: ______________________________
Its: ______________________________
42
Exhibit “A”
TRIBUTE SUBLEASED PREMISES
Being a parcel of land located in the City of the Colony, Denton County, Texas, a part of the B.B.B. &
C.R.R. Survey, Abstract 170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett
Survey, Abstract 751, and also being a part of that United States of America Remainder of Tract C-239A
recorded in Volume 384, Page 162, Deed Records Denton County, Texas, and being further described as
follows:
BEGINNING at a five-eighths inch iron rod with yellow cap stamped “CARTER BURGESS” found at the
northeast corner of that called 252.107 acre tract of land described in Memorandum of Lease Agreement
between Wynnwood Army, LLC and Wynnwood Peninsula Golf, LLC as recorded in Volume 4154, Page
1595, Deed Records Denton County, Texas, said point also being in the west line of Tract 3 called 107.317
acres as described in deed to Tribute Partners, L.P. as recorded in Document Number 2010-69114, Denton
County Deed Records;
THENCE along the north line of said 252.107 acre tract as follows:
South 88 degrees 36 minutes 12 seconds West, 511.84 feet to a five-eighths inch iron rod found for corner;
North 48 degrees 05 minutes 13 seconds West, 355.55 feet to a point for corner, said point being the
northwest corner of said 252.107 acre tract;
THENCE North 30 degrees 58 minutes 59 seconds East, 657.06 feet to a Corp of Engineers monument
found at the southwest corner of Tract 23 called 250.65 acres as described in deed to Tribute Partners, L.P.
as recorded in Document Number 2010-69110, Denton County Deed Records, said point also being in the
east line of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE along the south line of said Tract 23 as follows:
North 89 degrees 54 minutes 20 seconds East, 192.65 feet a Corp of Engineers monument found for corner;
North 87 degrees 58 minutes 59 seconds East, 238.88 feet to a one-half inch iron rod found for corner;
South 04 degrees 08 minutes 26 seconds East, 31.84 feet to a point for corner, said point also being the
northwest corner of Tract 21 called 23.486 acres as described in deed to Tribute Partners, L.P. as recorded
in Document Number 2010-69114, Denton County Deed Records;
THENCE along the west line of said Tract 21 as follows:
South 00 degrees 18 minutes 25 seconds East, 299.92 feet to a point for corner;
South 00 degrees 20 minutes 14 seconds East, 465.40 feet to the POINT OF BEGINNING and containing
491,064 square feet or 11.273 acres of land.
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AFTER RECORDING RETURN TO:
_____________________
_____________________
_____________________
_____________________
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY
INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS
FILED FOR RECORD IN PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR
DRIVER’S LICENSE NUMBER.
THE STATE OF TEXAS §
§
COUNTY OF DENTON §
CONSENT TO SUB-GROUND SUBLEASE AND NON DISTURBANCE AGREEMENT
AND NON-DISTURBANCE AGREEMENT
THIS CONSENT TO SUB-GROUND SUBLEASE AGREEMENT (this “Consent”) dated as of
this ____ day of ______________, 202__ (the “Effective Date”), is executed by The City of theThe
Colony, Texas (together with its permitted successors and assigns, the “City”), Marine Quest – Hidden
Cove, L.P., a Texas limited partnership (together with its permitted successors and assigns, “Marine
Quest”), and HCM Dry StorageWynwood Army, LLC, a Texas limited liability company (together with
its permitted successors and assigns, “HCMWynwood”), and Argo SMI Tribute, LLC, a Delaware limited
liability company (together with its permitted successors and assigns, “Tribute”).
Recitals
A. The United States Secretary of the Army (the “Corps”), as lessor, and Thethe City, as
lessee, executed and entered into that certain Lease No. DACW63-1-00-081608-0613 dated as of May 12,
2000, and replaced as of July 3June 9, 2008 (as amended and replaced, the “Underlying Lease”)”),
concerning certain real property as more fully described in the Underlying Lease.
B. The City, as sublessor, and Marine QuestWynwood, as sublessee, executed and entered
into that certain Ground Lease, Leased Real Property and Personal Property Lease Agreement dated as of
January 3, 2005July 21, 1997 (as amended, the “Marine QuestWynwood Sublease”)”), concerning certain
real property as more fully described in the Marine QuestWynwood Sublease (the “Marine Quest
Premises”)..
C. Marine QuestWynwood, as sublandlord, and HCMTribute, as sublessee, executed and
entered into that certain Amended and RestatedGround Sublease Agreement dated as of ____________,
202___ (as amended, restated, replaced, supplemented or otherwise modified from time to time, the
“HCMTribute Sublease”) concerning certain real property and water area over submerged real property
as set forth in Exhibit “A” (the “HCMTribute Subleased Premises”).
1. Defined Terms. Unless otherwise defined in this Consent, each defined term used in this
Consent shall have the same meaning given to such term in the HCMTribute Sublease.
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2. Consent to Sublease. The City hereby consents to HCMTribute subleasing the
HCMTribute Subleased Premises from Marine QuestWynwood pursuant to the terms and conditions of the
HCMTribute Sublease. The City further consents to any Leasehold Mortgagee acquiring the HCMTribute
Subleased Premises from HCMTribute in accordance with the terms of the HCMTribute Sublease, and
agrees that the HCMTribute Subleased Premises may be assigned in accordance with the terms of the
HCMTribute Sublease.
3. City’s Representations and Warranties. The City hereby represents and warrants to
HCMTribute as of the Effective Date that, to the City’s current actual knowledge, (a) the Marine
QuestWynwood Sublease is in full force and effect; (b) neither the City nor Marine QuestWynwood is in
default under the Marine QuestWynwood Sublease; (c) the Underlying Lease is in full force and effect; and
(d) neither the City nor the Corps is in default under the Underlying Lease.
4. Marine Quest’sWynwood’s Representations and Warranties. Marine QuestWynwood
hereby represents and warrants to Tribute as of the HCMEffective Date that, to Marine Quest’sWynwood’s
current actual knowledge, (a) the Marine QuestWynwood Sublease is in full force and effect; (b) the Marine
QuestWynwood Sublease has not been assigned, encumbered, modified, extended or supplemented; and
(c) neither Marine QuestWynwood nor the City is in default under the Marine QuestWynwood Sublease.
5. HCM’sTribute’s Cure Rights.
(a)The City agrees to provide HCMTribute with copies of all notices of default and
any notice of termination given by the Corps to the City under the Underlying Lease within twenty
(20) days of receipt by the City of such notice and, in any event, with sufficient advance notice to
HCMTribute to provide HCMTribute with a reasonable period of time to cure such default.
HCMTribute and any Leasehold Mortgagee, at each of their option and in their sole discretion,
shall be permitted to cure any of the City’s defaults under the Underlying Lease, in which event the
City shall be liable for and obligated to repay HCMTribute or its Leasehold Mortgagee for all of
the costs incurred by HCMTribute or its Leasehold Mortgagee in curing such default of the City
under the Underlying Lease; provided, however, that the City is only able to provide HCMTribute
and its Leasehold Mortgagee with the same cure period as the City has under the Underlying Lease
(which cure periods shall run concurrently), and any extension of such cure period shall be in the
Corps’ discretion. HCM’sTribute and its Leasehold Mortgagee’s right to cure defaults is for the
full protection of HCMTribute and its Leasehold Mortgagee and the existence of this right shall not
release the City from the obligation to perform all of its obligations under the Underlying Lease or
deprive HCMTribute or its Leasehold Mortgagee of any other right which HCMTribute or its
Leasehold Mortgagee may have by reason of such default by the City.
(b)The City and Marine QuestWynwood agree to provide HCMTribute with copies
of all notices of default and any notice of termination given by the City to Marine QuestWynwood
under the Marine QuestWynwood Sublease concurrently with the delivery of (or receipt of, as
applicable) such notice. HCMTribute and its Leasehold Mortgagee, at their option and in their sole
discretion, shall be permitted to cure any of Marine Quest’sWynwood’s defaults under the Marine
QuestWynwood Sublease, in which event Marine QuestWynwood shall be liable for and obligated
to repay HCMTribute or its Leasehold Mortgagee for all of the costs incurred by HCMTribute or
its Leasehold Mortgagee in curing such default of Marine QuestWynwood under the Marine
QuestWynwood Sublease; provided, however, that HCMTribute or its Leasehold Mortgagee must
cure Marine Quest’sWynwood’s default under the Marine QuestWynwood Sublease within the
same cure period as Marine QuestWynwood has under the Marine QuestWynwood Sublease
(which cure periods shall run concurrently). HCM’sTribute and its Leasehold Mortgagee’s right
to cure defaults is for the full protection of HCMTribute and its Leasehold Mortgagee and the
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existence of this right shall not release Marine QuestWynwood from the obligation to perform all
of its obligations under the Marine QuestWynwood Sublease or deprive HCMTribute or its
Leasehold Mortgagee of any other right which HCMTribute or its Leasehold Mortgagee may have
by reason of such default by Marine QuestWynwood.
6. Estoppel. By executing this Consent, Marine QuestWynwood hereby ratifies, confirms and
approves the Marine QuestWynwood Sublease. Marine QuestWynwood represents and warrants to
HCMTribute, as of the Effective Date, that, to Marine Quest’sWynwood’s current actual knowledge, (a)
the City is not in default of its obligations under the Marine QuestWynwood Sublease; and (b) no event
has occurred or failed to occur that with the passage of time, the giving of notice or both would constitute
a default or breach by the City or Marine QuestWynwood of their respective obligations and liabilities
under the Marine QuestWynwood Sublease. To Marine Quest’sWynwood’s current actual knowledge,
Marine QuestWynwood is not entitled to any refunds, rebates, offsets or credits with respect to any amounts
heretofore paid by Marine QuestWynwood under the Marine QuestWynwood Sublease. To Marine
Quest’sWynwood’s current actual knowledge, Marine QuestWynwood has no claim, counterclaim or other
defense to the payment of rent or other amounts due or to become due under the Marine QuestWynwood
Sublease or the performance of any of Marine Quest’sWynwood’s other obligations under the Marine
QuestWynwood Sublease. As of the Effective Date, Marine QuestWynwood has not assigned the
HCMTribute Sublease, in whole or in part, nor has Marine QuestWynwood assigned any of its rights, title
or interests in the Tribute Sublease, and Marine QuestWynwood has not subleased the HCMTribute
Subleased Premises or any part thereof. As of the Effective Date, all leasehold improvements and other
alterations and modifications to the HCM Subleased Premises have been fully completed in accordance
with the provisions of the Marine Quest Sublease and all obligations of and to the City have been paid and
performed in full. As of the Effective Date, the Marine Quest Subleased Premises are tenantable and
occupied by Marine Quest. As of the Effective Date, the City has no obligation to install or construct any
leasehold improvements or other alterations or modifications to the Marine Quest Subleased Premises or to
pay or reimburse Marine Quest for any amounts in connection therewith.
7. Non-Disturbance and Attornment. The City agrees that during the term of the HCMTribute
Sublease, including any extended term thereof, HCM’sTribute’s rights under the HCMTribute Sublease
and HCM’sTribute’s possession of the HCMTribute Subleased Premises shall not be disturbed, modified,
enlarged, or otherwise affected, and HCM’sTribute’s rights and privileges under the HCMTribute Sublease
shall not be diminished or interfered with by the City upon any exercise of its rights (including any
proceeding to foreclose) under the Underlying Lease or the Marine QuestWynwood Sublease, and the City
will not join HCMTribute as a party defendant in any proceeding resulting from a default by the City or
Marine QuestWynwood under the Underlying Lease or the Marine QuestWynwood Sublease. In the event
that the City exercises any of its remedies in the event of a default by Marine QuestWynwood or any other
rights, as provided for in the Underlying Lease or Marine QuestWynwood Sublease, or in the event the
Marine QuestWynwood Sublease is terminated by reason of rejection of the Marine QuestWynwood
Sublease in any bankruptcy case without the prior written consent of HCMTribute and any Leasehold
Mortgagee, the HCMTribute Sublease shall not be terminated or affected by the default or action of the
City or Marine QuestWynwood, or all. HCMTribute covenants and agrees to attorn to the City, as its new
landlord if Marine Quest’sWynwood’s rights under the Marine QuestWynwood Sublease are terminated,
and the HCMTribute Sublease shall continue in full force and effect as a direct lease between the City and
HCMTribute, or upon written request of HCMTribute at the time of termination by City, the City agrees to
enter into a new lease of the HCMTribute Subleased Premises with HCMTribute, provided that the City
has received consents necessary from the Corps in accordance with the Underlying Lease. The new lease
shall be effective as of the date of termination or rejection of the Marine QuestWynwood Sublease and be
on substantially the same terms and conditions as the Marine QuestTribute Sublease (including, without
limitation, any rights or options to extend the term of the Marine QuestTribute Sublease),) and shall not
materially expand or reduce the rights or obligations of the landlord or tenant thereunder. HCMTribute
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shall not be liable for or otherwise be required to cure any defaults which are personal to Marine
QuestWynwood (such as, for example, any default arising by virtue of any bankruptcy, insolvency or
dissolution of Marine QuestWynwood). The City’s obligation to enter into the new lease shall be
conditioned upon HCMTribute having cured all monetary defaults under the Marine QuestWynwood
Sublease relating to rental payments or the physical upkeep and maintenance of the HCMTribute Subleased
Premises. The new lease shall be superior to all rights, liens and interests granted at any time on the City’s
leasehold interest in the HCMTribute Subleased Premises and to all rights, liens and interests intervening
between the date of the HCMTribute Sublease and the granting of the new lease. Notwithstanding anything
to the contrary contained in this Consent, HCMTribute shall not interfere with or attempt to diminish in any
way Marine Quest’sWynwood’s rights and privileges under the Marine QuestWynwood Sublease or any
other agreements between the City and Marine QuestWynwood.
8. Not an Amendment to Marine QuestWynwood Sublease. This Consent does not constitute,
and shall not be deemed, construed or held to be, an amendment or modification of the Marine
QuestWynwood Sublease. During the term of the Underlying Lease, the City shall be prohibited from (a)
amending the Underlying Lease in any way that will increase the liabilities or obligations of HCMTribute
under the HCMTribute Sublease or this Consent or otherwise reduce the rights of HCMTribute with respect
to the HCMTribute Subleased Premises or its use thereof; or (b) voluntarily agreeing to terminate the
Underlying Lease prior to its natural expiration thereof unless such termination arises from a casualty or
condemnation, which casualty or condemnation, by itself, results in the termination of the HCMTribute
Sublease. During the term of the Marine QuestWynwood Sublease, the City and Marine QuestWynwood
shall be prohibited from (a) amending the Marine QuestWynwood Sublease in any way that will increase
the liabilities or obligations of HCMTribute under the HCMTribute Sublease or this Consent or otherwise
reduce the rights of HCMTribute with respect to the HCMTribute Subleased Premises or its use thereof; or
(b) voluntarily agreeing to terminate the Marine QuestWynwood Sublease prior to its natural expiration
thereof unless such termination arises from a casualty or condemnation, which casualty or condemnation,
by itself, results in the termination of the HCMTribute Sublease.
9. Amendment. This Consent constitutes the entire agreement of the parties with respect to
the subject matter contained herein. This Consent cannot be modified or amended except in writing
executed by the City, Marine QuestWynwood, and HCMTribute.
10. Authority. Each party executing this Consent on behalf of a party hereto represents and
warrants to the other party hereto that the agent, partner or officer executing this Consent on the representing
party’s behalf is fully authorized, directed and empowered to execute and deliver this Consent in such
capacity as the act and deed of the party on whose behalf he or she is executing this Consent and that all
corporate or company action requisite to such execution and delivery has been taken by such party.
11. Governing Law. This Consent shall be governed by and construed and enforced in
accordance with the laws of the State of Texas.
12. Counterparts. This Consent may be executed in counterparts, and each counterpart when
fully executed and delivered by the parties hereto will be an original instrument, but all such counterparts
will constitute one agreement.
[Signature Page(s) to Follow]
48
Executed and effective as of the Effective Date.
CITY: The City of theThe Colony, Texas
By: ______________________________
Name: ______________________________
Its: ______________________________
MARINE QUEST: Marine Quest – Hidden Cove, L.P.,WYNWOOD:
Wynwood Army, LLC,
a Texas limited partnershipliability company
By: ______________________________
Name: ______________________________
Its: ______________________________
HCM: HCM Dry StorageTRIBUTE: Argo
SMI Tribute, LLC,
a TexasDelaware limited liability company
By: ______________________________
Name: ______________________________
Its: ______________________________
49
Exhibit “A” – Page 6
Exhibit “A”
HCMTRIBUTE SUBLEASED PREMISES
AND
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Exhibit “A” – Page 7 51
Exhibit “A” – Page 8
AND
52
Exhibit “A” – Page 9
AND the DFW Surf Office outlined in red below.
Being a parcel of land
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Exhibit “A” – Page 10
located in the City of the Colony, Denton County, Texas, a part of the B.B.B. & C.R.R. Survey, Abstract
170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett Survey, Abstract 751, and
also being a part of that United States of America Remainder of Tract C-239A recorded in Volume 384,
Page 162, Deed Records Denton County, Texas, and being further described as follows:
BEGINNING at a five-eighths inch iron rod with yellow cap stamped “CARTER BURGESS” found at the
northeast corner of that called 252.107 acre tract of land described in Memorandum of Lease Agreement
between Wynnwood Army, LLC and Wynnwood Peninsula Golf, LLC as recorded in Volume 4154, Page
1595, Deed Records Denton County, Texas, said point also being in the west line of Tract 3 called 107.317
acres as described in deed to Tribute Partners, L.P. as recorded in Document Number 2010-69114, Denton
County Deed Records;
THENCE along the north line of said 252.107 acre tract as follows:
South 88 degrees 36 minutes 12 seconds West, 511.84 feet to a five-eighths inch iron rod found for corner;
North 48 degrees 05 minutes 13 seconds West, 355.55 feet to a point for corner, said point being the
northwest corner of said 252.107 acre tract;
THENCE North 30 degrees 58 minutes 59 seconds East, 657.06 feet to a Corp of Engineers monument
found at the southwest corner of Tract 23 called 250.65 acres as described in deed to Tribute Partners, L.P.
as recorded in Document Number 2010-69110, Denton County Deed Records, said point also being in the
east line of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE along the south line of said Tract 23 as follows:
North 89 degrees 54 minutes 20 seconds East, 192.65 feet a Corp of Engineers monument found for corner;
North 87 degrees 58 minutes 59 seconds East, 238.88 feet to a one-half inch iron rod found for corner;
South 04 degrees 08 minutes 26 seconds East, 31.84 feet to a point for corner, said point also being the
northwest corner of Tract 21 called 23.486 acres as described in deed to Tribute Partners, L.P. as recorded
in Document Number 2010-69114, Denton County Deed Records;
THENCE along the west line of said Tract 21 as follows:
South 00 degrees 18 minutes 25 seconds East, 299.92 feet to a point for corner;
South 00 degrees 20 minutes 14 seconds East, 465.40 feet to the POINT OF BEGINNING and containing
491,064 square feet or 11.273 acres of land.
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Exhibit “A” – Page 11 55
GROUND SUBLEASE AGREEMENT
This Ground Sublease Agreement (this “Sublease”) is entered into as of the ______ day of
_____________, 20__, by and between the Sublessor and the Sublessee hereinafter named.
ARTICLE I.
Section 1.1. Fundamental Lease Provisions.
(1) Sublessor: Wynnwood Army, LLC, a Texas limited liability company
(2) Sublessor’s Address: c/o Matthews Southwest
320 West Main Street
Lewisville, Texas 75057
Attn: Kristian Teleki
Telephone: (972) 221-1199
Email: kteleki@matthewssouthwest.com
(3) Sublessee: Argo SMI Tribute, LLC, a Delaware limited liability company
(4) Sublessee’s Address: 17330 Preston Road, Suite 100C
Dallas, Texas 75252
Attn: Chris Petty
Telephone: (972) 789-1400
Email: cpetty@suntex.com
(5) Commencement Date: The date that is twelve (12) months after the date all Construction
Conditions are satisfied in their entirety, subject to extension as provided in Section 6.1 below.
(6) Demised Premises: Approximately 11.273 acres, more or less, of land located in Wynnwood
Park in The Colony, Denton County, Texas as more particularly described by metes and bounds on
Exhibit “A” attached hereto and incorporated herein by reference (the “Park Area”) plus
approximately 81.745 acres of submerged land, as more particularly described in the drawing of
the Water Lease Boundary on Exhibit “A-1” attached hereto and incorporated herein by reference
(the “Water Area”) along with (i) any and all improvements located in, on or across the Demised
Premises, including but not limited to the Marina Facilities (defined below), the Park Facilities
(defined below), and any other Improvements (defined below), all as more particularly designated
and depicted on Exhibit “B” attached hereto and incorporated herein by reference (the “Site Plan”);
and (ii) any and all rights to all easements and appurtenances in, on and across the Demised
Premises or in any way pertaining to the Demised Premises; provided, however, the Future
Building (defined below) is not included in the Demised Premises.
(7) Marina Facilities: The Marina Facilities will consist of a maximum of 801 wet slips to be situated
on approximately 42 acres, plus or minus of the Demised Premises and allocated by the Corps
under the Corps Lease and City Sublease, gangways from the docks to the Top of Flowage
Easement (hereinafter defined) identified as “Trail to Marina” (the “Gangways”), facilities for the
rental of jet skis and boats, licensing of wet slips, boat club, boat sales and fuel sales including a
fuel tanks and tank fill station located on the Park Area (the “Fuel Tanks”), a fuel dispenser dock
and store (the “Gas Station”), and a convenience store. Sublessor and Sublessee agree that not all
of the wet slips will be constructed by Sublessee as part of the Initial Marina Facilities (defined
below). The construction of the Sublessee Improvements, including but not limited to the Marina
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Facilities, is planned for a phased construction sequence consisting of two or more phases. During
the First Phase of the Project (defined below), the Marina Facilities will consist of a minimum of
399 wet slips, the Gas Station, and the Fuel Tanks located on the Park Area, as more specifically
set forth on the Design of the Marina Facilities attached hereto as Exhibit “C” and incorporated
herein and described in the Sublessee Plans and Specifications (collectively, the “Initial Marina
Facilities”). The size of the Marina Facilities, including but not limited to the exact number of
wet slips above the minimum of 399 wet slips, will be determined by Sublessee, in its sole
discretion, based on what Sublessee deems is reasonable and prudent. If at any time and from time
to time during the Term of this Sublease, Sublessee elects, in its sole discretion, to construct
additional wet slips, then the Marina Facilities will be expanded to include, and consist of, the
additional number of wet slips, as will be determined by Sublessee, in its sole discretion, along with
necessary improvements (each a “Future Phase” and collectively “Future Phases”) and to provide
access to and from all wet slips as more specifically shown on Exhibit “C”. The exact number of
additional wet slips to be added to the Marina Facilities from time to time will be determined by
Sublessee, in its sole discretion, based on what Sublessee deems is reasonable and prudent,
provided, the total number of wet slips does not exceed the maximum number of wet slips allocated
by the Corps under the Corps Lease, the City Sublease and the Sublessee Plans and Specifications.
The Marina Facilities must comply with the Corps Lease, City Sublease and applicable
Governmental Regulations.
(8) Park Facilities: The Park Facilities will be a public neighborhood park constructed by Sublessor
on the Park Area, including Parking (defined below) for the Park Facilities, Park Area, and the
Marina and will consist of improvements and open areas constructed by Sublessor, including but
not limited to the following as specifically shown on the Design of the Park attached hereto as
Exhibit “D” and incorporated herein by reference and described in the Sublessor Plans and
Specifications: the restroom building and EMS equipment storage building, a multi-purpose
lawn/special event area with a sloping hill for additional seating, picnic areas, lawn games, stage
(with electric) and multi-purpose lawn, concrete trails, two (2) concrete access walkways to the
Gangways, and sand volleyball court. The Park Facilities will have fully gated access. During
the First Phase of the Project (defined below), Sublessor will construct and complete the Park
Facilities in their entirety together with a minimum of 172 paved vehicle parking spaces and 50
paved golf cart parking spaces. Any material modifications to the Park Facilities shown on Exhibit
“D” and set forth in the Sublessor Plans and Specifications are subject to Sublessee’s prior
approval, which approval will not be unreasonably withheld, conditioned or delayed; provided,
however, Sublessee’s approval will not be required for changes needed to keep the costs of
Sublessor Improvements within the $7,800,000.00 budget as provided in Section 6.3 below.
Sublessor will deliver prior written notice to Sublessee of any changes to the Park Facilities
improvements intended to be made by Sublessor. Sublessor and Sublessee acknowledge and agree
that the Park Facilities must be open to the public as provided in the Corps Lease and City Sublease.
Section 1 of the City Second Amendment (hereinafter defined) sets forth the current uses that are
permitted under the City Sublease.
(9) Parking: Parking for the Marina Facilities and Park Facilities will consist of 467 paved parking
spaces (358 vehicle parking spaces and 109 golf cart parking spaces) and up to 167 unpaved parking
spaces for special event parking, by separate permit, as needed. Parking will be adequate for the
marina uses and park uses and will be in accordance with the attached Sublessor Plans and
Specifications and as shown in the attached diagram and identified as “Parking” (the “Parking”)
on Exhibit “E”. The number of parking spaces to be included in the Parking will be shared on an
unreserved basis by the Marina Facilities, the Park Facilities, and the Future Building and will be
based, in part, on the maximum number of permitted wet slips set forth in the Sublessee Plans and
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Specifications, and in no event shall the amount of parking spaces for the Marina Facilities be less
than what is required by Governmental Regulation in order to legally operate the Marina Facilities.
(10) Primary Sublease Term: Commencing on the Commencement Date and ending on March 31,
2058, unless terminated earlier as expressly provided herein. The parties acknowledge that the end
of the Primary Sublease Term is the same end date of the lease term under the Corps Lease.
(11) Monthly Rent: $0 each month for the first twelve (12) full calendar months after the
Commencement Date and Five Percent (5%) of Gross Sales (defined herein) each month
commencing on the first day of the thirteenth (13th) full calendar month after the Commencement
Date and continuing each month thereafter throughout the Primary Sublease Term.
(12) Permitted Uses: Any and all uses associated with (a) the Marina Facilities, which marina use has
been previously approved by the U.S. Army Corps of Engineers (the “Corps”) under the Corps
Lease and the City of The Colony, Texas (the “City”) under the City Sublease, including but not
limited to the Gas Station; (b) the Park Facilities and the Parking; (c) the Fuel Tanks located within
the Park Area; and (d) such other uses permitted under Section 1 of the City Second Amendment
(hereinafter defined) to the City Sublease. Sublessor and Sublessee acknowledge and agree that
dry storage operations and a public boat ramp are not permitted on the Demised Premises.
(13) Possession: Sublessor will give possession of the Demised Premises to Sublessee to begin
operation of the Demised Premises as of the substantial completion of the Park Facilities and
Parking, which completion may be evidenced by receipt of either a City acceptance letter for civil
plan improvements or a certificate of occupancy for all or any portion of the Demised Premises
(such as for the restroom); provided, however, Sublessee is permitted to access the Demised
Premises for Sublessee’s construction of the Initial Sublessee Improvements (hereinafter defined)
at any time after the Effective Date but prior to the date of Possession. Sublessee’s access to, over,
and across the Demised Premises for construction of the Initial Marina Facilities will be through
the location generally shown in Exhibit “J” attached to and made a part of this Sublease (the
“Temporary Construction Access”), but in no event will any construction access be through the
Park Facilities. Sublessee’s possession of the Park Facilities will be on a non-exclusive basis and
will be subject to Sublessor License set forth in Section 10.4 below; provided, however, the Fuel
Tank and Trash Dumpster Areas shall be excluded from the Sublessor License and Sublessee shall
have exclusive possession of the Fuel Tank and Trash Dumpster Areas.
(14) Construction Conditions: “Construction Conditions” shall mean Sublessor and Sublessee shall
receive: (i) all required permits, approvals and licenses from all governmental authorities (including
but not limited to the Corps and City) to construct or install the Sublessor Improvements and the
Sublessee Improvements, including but not limited to the approval of the Fuel Tanks as part of the
Marina Facilities, in accordance with Sublessee’s plans, and to allow the use and occupancy of the
Demised Premises; (ii) a copy of all required permits, approvals, and licenses from all
governmental authorities (including but not limited to the Corps and City) for Sublessee to
construct or install the Gas Station in accordance with Sublessee’s plans and to allow the use of the
Gas Station; and (iii) all necessary lease amendments executed by all applicable parties, including
but not limited to Sublessor and the Corps and the City, amending the leased premises under the
Corps Lease, if and to the extent necessary, to incorporate and include all of the Demised Premises.
The required permits include, but may not be limited to, the Fuel Tanks and piping permit (to be
obtained by Sublessee).
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(15) Wynnwood Park: “Wynnwood Park” shall mean that certain park located in Denton County,
Texas comprised of approximately 650 acres leased to the City by the Corps and subsequently
subleased by the City to Wynnwood Peninsula, L.P.
(16) First Phase of the Project: “First Phase of the Project” shall mean the twenty-four (24) month
period beginning on the Effective Date of this Sublease and ending on the last day of the twenty-
fourth (24th) full calendar month thereafter.
(17) Sublessor License: “Sublessor License” shall mean the license granted by Sublessee to Sublessor
as set forth in Section 10.4 of this Sublease.
(18) Tribute Marina Park: “Tribute Marina Park” shall mean all of the: (i) the land shown on the
Site Plan attached as Exhibit “B” and incorporated herein for all purposes and all improvements of
every kind thereon or associated therewith; (ii) the Park Area, Park Facilities, Parking and all
improvements, easements and licenses of every kind thereon or associated therewith, and (iii) the
Water Area, Marina Facilities and all improvements, easements and licenses of every kind thereon
or associated therewith.
Section 1.2. Additional Definitions:
(1) “Association” means The Tribute Owners Association, Inc., which is the Texas property owners
association for The Tribute community.
(2) “Effective Date” means the date this Sublease is signed by Sublessor and Sublessee.
(3) “Governmental Regulations” means all laws, ordinances, rules, regulations, statutes, building
codes and other matters of all governmental authorities having jurisdiction over the Demised
Premises, including all health, environmental and regulatory requirements.
(4) “Top of Flowage Easement” means the line on the shore that is at an elevation of 537 feet, as
adjusted by the Corps from time to time.
(5) “Sublessee Improvements” means the real and personal property improvements to be constructed
by Sublessee as part of the Demised Premises, including the Initial Marina Facilities up to the Top
of Flowage Easement and revetments and erosion control for the shoreline (the “Marina
Shoreline”) remediation work (the “Initial Sublessee Improvements”), and all additional real and
personal property improvements, including but not limited to any and all additional wet slips added
to the Marina Facilities, all as more particularly set forth in the plans and specifications approved
in accordance with the terms of this Sublease (“Sublessee Plans and Specifications”) attached
hereto as Exhibit “F” and constructed from time to time by Sublessee in accordance with the terms
of this Sublease (collectively, the “Sublessee Improvements”). The Fuel Tanks must be located
above the Top of Flowage Easement. Sublessor and Sublessee acknowledge and agree that as of
the Effective Date of this Sublease the parties are attaching conceptual plans and specifications for
the Sublessee Improvements. Sublessor and Sublessee agree that final detailed Sublessee Plans
and Specifications for the Sublessee Improvements approved by all required parties in accordance
with this Sublease will be attached as Exhibit “F” prior to Sublessor and Sublessee commencing
construction of any kind on the Demised Premises.
(6) “Sublessor Improvements” means the real and personal property improvements above the Top of
Flowage Easement to be constructed by Sublessor on the Park Area, including but not limited to
the Park Facilities, Parking improvements, revetments and erosion control as needed for the
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shoreline remediation work (the “Park Shoreline”), and utility infrastructure improvements to be
made on the Park Area, all as more particularly set forth in the plans and specifications approved
in accordance with the terms of this Sublease (“Sublessor Plans and Specifications”) attached
hereto as Exhibit “G” and constructed by Sublessor in accordance with the terms of this Sublease.
Sublessor Improvements do not include the Fuel Tanks. Sublessor and Sublessee acknowledge and
agree that as of the Effective Date of this Sublease the parties are attaching conceptual plans and
specifications for the Sublessor Improvements. Sublessor and Sublessee agree that final detailed
Sublessor Plans and Specifications for the Sublessor Improvements approved by all required parties
in accordance with this Sublease will be attached as Exhibit “G” prior to Sublessor and Sublessee
commencing construction of any kind on the Demised Premises.
(7) “Improvements” means collectively the Sublessee Improvements and the Sublessor
Improvements.
(8) “Corps Lease” means that certain Lease No. DACW63-1-08-0613 dated June 9, 2008, by and
between the Secretary of the Army (on behalf of the United States) and the City (the “Original
Corps Lease”), as amended by that certain First Amendment to Lease No. DACW63-1-08-0613
(the “Corps First Amendment”), and as further amended, if applicable (collectively, the “Corps
Lease”).
(9) “City Sublease” means that certain Ground Lease Agreement dated July 21, 1997, by and between
the City and Sublessor (the “Original Sublease”), as amended by that certain First Amendment to
Ground Lease Agreement dated July 20, 1998 (the “City First Amendment”), that certain Second
Amendment to Ground Lease Agreement dated April 21, 2008 (the “City Second Amendment”),
that certain Third Amendment to Ground Lease Agreement dated on or about the Effective Date of
this Sublease (the “City Third Amendment”), and as further amended, if applicable (collectively
(the “City Sublease”).
(10) “Leasehold Mortgage” means any mortgage, deed of trust or similar lien on the leasehold estate
of Sublessee hereunder.
(11) “Leasehold Mortgagee” means the holder of any Leasehold Mortgage or other purchaser at a
foreclosure or other sale pursuant to the terms of a Leasehold Mortgage that has acquired the
leasehold estate under this Sublease by foreclosure.
(12) “Sublessor’s Lender” has the meaning set forth in Section 12.5 of this Sublease.
(13) “Sublessor’s Mortgage” has the meaning set forth in Section 12.5 of this Sublease.
(14) “District Engineer” means the U.S. Army District Engineer for the Fort Worth District who is in
charge of the administration of the Lewisville Lake Project Area.
(15) “Future Building” means the future building area proposed to be constructed by Sublessor within
a parcel of approximately 1.4 acres described and shown on Exhibit “A-2”, together with all
improvements constructed on such parcel by Sublessor.
Section 1.3. Effect of Reference to Fundamental Lease Provisions and Definitions. Each
of the foregoing definitions and fundamental lease provisions shall be construed in conjunction with and
limited by the references thereto in the other provisions of this Sublease.
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ARTICLE II.
Section 2.1. Demised Premises. In consideration of the obligation to Sublessee to pay rent as
herein provided and in consideration of the other terms, covenants and conditions hereof, Sublessor hereby
demises and leases to Sublessee, and Sublessee hereby takes from Sublessor, the Demised Premises as
described in Section 1.1(6), TO HAVE AND TO HOLD the Demised Premises for the Primary Lease Term,
all upon the terms and conditions set forth in this Sublease. Sublessor further agrees that if Sublessee
performs all of the covenants and agreements herein required to be performed by Sublessee and otherwise
subject to the terms of this Sublease, Sublessee shall have peaceful and quiet possession of the Demised
Premises at all times after the delivery of Possession of the Demised Premises as set forth in Section 1.1(15)
and during the continuance of this Sublease. Sublessee acknowledges that this Sublease is subject to the
Corps Lease and the City Sublease and this Sublease will not be effective until approved in writing by the
Commander or District Engineer for the Corps and by the City. Sublessee acknowledges that rights
retained by the Secretary of the Army under the Corps Lease include, but are not limited to, the right to
flood the Demised Premises and the right to change the Lewisville Lake level.
ARTICLE III.
TERM
Section 3.1. Primary. The term of this Sublease shall commence on the Commencement Date
and continue in full force and effect for the Primary Sublease Term, subject to extension and earlier
termination as provided herein. Notwithstanding anything to the contrary contained in this Sublease, if all
of the Construction Conditions have not been satisfied in their entirety on or before twelve (12) months
after the Effective Date, then either Sublessor or Sublessee shall have a one-time right to terminate this
Sublease at any time prior to the Commencement Date by delivering written notice to the other party;
provided, however, so long as the party that has not been successful in satisfying all of its respective
Construction Conditions within such 12-month period has commenced and is proceeding in good faith and
with due diligence to satisfy any remaining Construction Conditions, then the other party shall not have a
right to terminate this Sublease under this Section 3.1. Upon satisfaction of all Construction Conditions,
Sublessee will reimburse Sublessor for one-half (1/2) of the actual cost and expense (up to and not to exceed
$87,500.00) incurred by Sublessor related to the Corps and City approvals and permits issued for the Marina
Facilities in accordance with the Sublessee Plans and Specifications prepared by Sublessee and approved
by Sublessor as attached hereto as Exhibit “F” and such reimbursement will be paid by Sublessee to
Sublessor within 30 days after delivery of the invoices for such expenses.
Section 3.2. Renewal. In the event that the Corps Lease is extended beyond the Primary
Sublease Term, the City Sublease is still in effect, and Sublessee is not in default under this Sublease at the
time of exercise or commencement, the term of this Sublease may be extended, at Sublessee’s option, for
the lesser time period of (i) the same extended term under the Corps Lease or (ii) the term under the City
Sublease (the “Renewal Lease Term”). Sublessor will use good faith efforts to notify Sublessee if the
Corps Lease is extended beyond the Primary Sublease Term. The option for the Renewal Lease Term may
be exercised by Sublessee by written notice to Sublessor at least 180 days before the end of the Primary
Sublease Term. Upon the timely giving of such 180-day notice, the renewal and extension of this Sublease
for such Renewal Lease Term shall be on and under the same covenants, agreements, terms, provisions,
and conditions that are contained herein for the Primary Sublease Term, except that the Annual Rental for
such Renewal Term shall be determined based on fair market rent as mutually agreed by Sublessor and
Sublessee (but in no event will the Annual Rental for such Renewal Lease Term be less than the Annual
Rental for the last year of the Primary Lease Term) and all leasehold improvements within the Demised
Premises shall be provided in their then existing condition (on an “AS-IS” basis) at the time the Renewal
Lease Term commences. If Sublessor and Sublessee cannot agree upon the Annual Rental for the Renewal
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Lease Term, then the parties will use an appraisal process mutually acceptable to Sublessor and Sublessee
to determine the fair market rent to base the Annual Rental on for the Renewal Lease Term. Sublessee
will have no option to renew this Sublease beyond the expiration of the Renewal Lease Term.
ARTICLE IV.
RENTAL
Section 4.1. Construction & Initial Operations Period. Except as otherwise provided
herein, no rent is due from Sublessee for the period from the Effective Date to the Commencement Date.
Section 4.2. Annual Rental. Sublessee shall to pay to Sublessor on the first day of each
calendar month after the Commencement Date for which this Sublease is in effect, in lawful money of the
United States of America, one-twelfth (1/12) of the Annual Rental (herein so called), as stated below, for
the applicable “lease year” herein defined as a period of twelve (12) consecutive calendar months which
shall commence on the Commencement Date if the Commencement Date occurs on the first day of a
calendar month, otherwise the first lease year shall commence on the first day of the first calendar month
next following the Commencement Date:
(1) Primary Term. The Annual Rental for the Primary Sublease Term, commencing with
the Commencement Date, is payable in monthly installments as follows:
Primary Term Annual Rental Monthly Installment Year 1 $0 $0 Years 2 through expiration of the Primary
Sublease Term
5% of the Gross Revenues
(except as otherwise
provided in Section 4.4(2)
below)
Monthly portion of Annual
Rental
Section 4.3. Net Rental. The Annual Rental payable by Sublessee hereunder is a “net” rental
that is owed Sublessor under this Sublease and does not include taxes, utilities, or insurance costs for the
Demised Premises.
Section 4.4. Rental Calculation. Annual Rental shall be the percentage rental determined by
multiplying the total Gross Sales (defined below) in or from the Demised Premises during the particular
Lease Year by the percentage rental rate stated in Section 4.2 (1) above. The percentage rental shall accrue
as of the Commencement Date and shall be paid in monthly installments in arrears for the prior month on
or before the tenth (10th) calendar day of each month during the term of this Sublease. Additionally, on or
before the 120th calendar day after the end of the applicable Lease Year, Sublessee shall pay to Sublessor,
a sum of money equal to the product of the percentage rental factor hereinabove specified, multiplied by
the total Gross Sales made in or from the Demised Premises during such preceding Lease year to the extent
not previously paid in the monthly installments.
Section 4.4.(1). Fractional Years. If the Commencement Date is on a date other than the first
day of a calendar year or terminate on a date other than the last day of a calendar year, percentage rental for
such fractional part of the calendar year following the Commencement Date or preceding the termination
date, as the case may be, shall be paid at the specified rate for all Gross Sales made during such fractional
part of a calendar year.
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Section 4.4.(2). Definition of Gross Sales. The term “Gross Sales,” as used herein, shall be
construed to include the entire amount of the sales price, whether for cash or credit or otherwise, of all sales
of Slip Licenses (hereinafter defined), slip or dock improvements for holders of Slip Licenses per Section
5.2.(5) below, boat rentals, boat sales, Parking Fees (hereinafter defined), merchandise, food, drinks and
services (including receipts whatsoever of all business conducted in or from the Demised Premises),
including mail, to-go or telephone orders received or filled at the Demised Premises, deposits not refunded
to purchasers, orders taken although filled elsewhere, sales to employees, sales through vending machines
or other devices, and sales by any sublessee, concessionaire or licensee or otherwise in said Demised
Premises, subject to the limitations and exclusions set forth below. Each sale upon installment or credit
shall be treated as a sale for the full price in the month during which such sale was made and earned,
irrespective of the time when Sublessee receives payment from its customer. Notwithstanding the
foregoing or anything to the contrary contained in this Sublease, Sublessee will only be required to pay two
percent (2%) of Gross Sales for all fuel and gasoline sales and one percent (1%) of all of Gross Sales for
all boat, watercraft and motor sales consummated on the Demised Premises by a manufacturer, retailer or
wholesaler of boats and watercraft. Gross Sales shall also not include, however, any sums collected and
paid out for any sales or excise tax imposed by any duly constituted governmental authority, nor shall it
include the exchange of merchandise between the stores of Sublessee, if any, where such exchanges are
made solely for the convenient operation of the business of Sublessee and not for the purpose of
consummating a sale which has theretofore been made in or from the Demised Premises and/or for the
purpose of depriving Sublessor of the benefit of a sale which otherwise would be made in or from the
Demised Premises, nor the amount of returns to shoppers or manufacturers, nor the amount of any cash or
credit refund made upon any sale where the merchandise sold, or some part thereof, is thereafter returned
by purchaser and accepted by Sublessee, nor sales of Sublessee’s trade fixtures after use by Sublessee in
the Demised Premises. Except to the extent modified by the terms of this Sublease, it is the intent of the
parties that the calculation of Gross Sales under this Sublease comply with the calculation of “Gross
Revenues” as defined in the City Sublease. Provided, however, if and to the extent there is a conflict
between the calculation of Gross Sales under this Sublease and the calculation of Gross Revenues under
the City Sublease, the calculation requirements in this Sublease will apply.
Section 4.4.(3). Statement of Gross Sales. On or before the 120th day of each Lease Year during
the term of this Sublease, Sublessee shall prepare and deliver to Sublessor, at the place where rental is then
payable, a statement certified as correct by an independent Certified Public Accountant showing the amount
of Gross Sales made during the preceding Lease Year. Such statement may be included in a company-
wide financial statement for Sublessee’s parent or direct holding company if (a) such company-wide
financial statement includes a separate line item for the Gross Sales under this Sublease or (b) such
independent Certified Public Accountant provides a separate letter in a form reasonably acceptable to
Sublessor certifying the Gross Sales under this Sublease. Sublessor and Sublessee agree that Sublessee
will engage a reputable local accounting firm to be the initial independent Certified Public Accountant. In
addition, within thirty (30) days after the termination of this Sublease if this Sublease does not terminate at
the end of a Lease Year, Sublessee shall prepare and deliver to Sublessor, at the place where rental is then
payable, a statement of Gross Sales during the preceding calendar year (or partial calendar year), certified
to be correct by an independent Certified Public Accountant. Sublessee shall furnish similar statements
for its licensees, concessionaires and sub-sublessees, if any. All such statements shall be in such form as
the Sublessor may reasonably require. If any such certified statement discloses error in the calculation of
the percentage rental for any period, appropriate adjustment of the percentage rental shall be made, subject,
however, to Sublessor’s rights under Section 4.4.(5).
Section 4.4.(4). Sales Records. Sublessee shall keep in the Demised Premises or at the
Sublessee’s principal office in the DFW area, which is listed in Section 1.1.(4) above, a permanent, accurate
set of books and records of all sales of merchandise and services and revenue derived from business
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conducted in or about the Demised Premises, and all supporting records, including, but not limited to, sales,
income and other tax reports, banking records, cash register tapes, sales slips and other sales records. All
such books and records shall be retained and preserved for at least twenty-four (24) months after the end of
the calendar year to which they relate, and shall be subject to inspection and audit by Sublessor and its
agents at all reasonable times.
Section 4.4.(5). Audit. In the event Sublessor is not satisfied with the statements of Gross Sales
submitted by Sublessee, Sublessor shall have the right to have its auditors make a special audit of all books
and records, wherever located, pertaining to sales made in or from the Demised Premises. If such
statements are found to be incorrect to an extent of more than five percent (5%) over the figures submitted
by Sublessee, Sublessee shall pay for such audit. Sublessee shall promptly pay to Sublessor any deficiency
or Sublessor shall promptly refund to Sublessee any overpayment, as the case may be, which is established
by such audit. Sublessee acknowledges that the City has audit rights under the City Sublease and agrees
to comply with the requirements of any audit by the City.
ARTICLE V.
USE OF DEMISED PREMISES
Section 5.1. Use. The Demised Premises shall be used by Sublessee only for the Permitted
Uses specified in Section 1.1.(14) above, and for no other purpose without the prior written consent of
Sublessor, the City and the Corps. The Demised Premises may only be used by Sublessee as permitted by,
and in full and strict compliance with, all Governmental Regulations, the Corps Lease, the City Sublease
and any restrictive covenants applicable to the Demised Premises. Sublessor and Sublessee acknowledge
that no structures may be erected or altered on the Demised Premises unless and until the type of use, design
and proposed location or alteration have been approved in writing by the District Engineer and the City.
Sublessee agrees to use commercially reasonable efforts to maintain and operate the Marina Facilities as a
first-class lake marina.
Section 5.2. Limitations on Use.
(1) Sublessee shall not keep anything within the Demised Premises or use the Demised
Premises for any purpose which invalidates any insurance policy carried on the Demised Premises. All
property kept, stored or maintained within the Demised Premises by Sublessee shall be at Sublessee’s sole
risk.
(2) Sublessee shall not permit any objectionable or unpleasant odors to emanate from the
Demised Premises; nor place any antenna, awning or other projection on the exterior of the Demised
Premises (other than those indicated on the Sublessee Plans and Specifications for the Sublessee
Improvements and otherwise approved in advance by Sublessor in writing); nor take any other action which
would constitute a nuisance. Sublessee shall comply with local noise ordinances in the operation of radios,
televisions, loudspeakers or amplifiers on the Demised Premises.
(3) Sublessee shall take good care of the Demised Premises and keep the same free from waste
at all times. Sublessee shall keep the Demised Premises neat, clean and free from dirt or rubbish at all
times, and shall store all trash and garbage within the Demised Premises. Sublessee shall arrange for the
regular pickup of such trash and garbage at Sublessee’s expense. Sublessee shall not operate an incinerator
or burn trash or garbage.
(4) Sublessee covenants and agrees that during the Sublease it will (a) maintain appropriate
certifications and licenses for the Permitted Uses and (b) use commercially reasonable efforts to maximize
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the Gross Sales generated therefrom consistent with sound business practices and Sublessee’s concurrent
goal of maximizing its net operating income therefrom.
(5) Sublessee covenants and agrees that it will impose and enforce rules and regulations on
holders of Slip Licenses and users of the Marina Facilities to help with maintaining and operating the
Marina Facilities in a first-class manner, which rules and regulations will include, but not be limited to, the
following: (a) the USACE Marina local policies described in Exhibit “H” attached hereto; (b) quiet hours
will be maintained during the hours required by the then-current City noise ordinance; (c) any petroleum
leaking from the bilge or any other part of a vessel must be cleaned up immediately by the vessel owner or
operator; (d) all watercraft must be in good repair, neat condition and clean; (e) pets must be leashed while
on the docks and pet owners are required to clean up after their pets; (f) no open flames are to be allowed
on the docks; (g) advertising or soliciting is not permitted except in an area designated for such purpose by
Sublessee; (h) if storage lockers are permitted under the Slip Licenses, storage lockers must be placed over
the wet marina slip or on the slip patio (not in the walkway) and all personal property and equipment must
be stored within such storage locker; (i) fishing and cast netting are not permitted from the docks or slips;
(j) swimming and diving are not permitted in the waters of the Marina Facilities; and (k) any additions or
improvements desired by holders of Slip Licenses including, but not limited to, electrical, decking,
cabinetry, t.v. mounts, boat lifts) must be performed by Sublessee in accordance with standard design
options to be submitted by Sublessee to the Corps and the City for approval.
Section 5.3. Disclaimer of Representations and Warranties. Sublessor makes no
representations or warranties, express, implied, or otherwise, as to the suitability of the Demised Premises
for use by Sublessee nor as to the Sublessee’s intended use of the Demised Premises being in compliance
with any deed restrictions, laws, regulations, rules, ordinances, building codes, zoning requirements, or
other similar restrictions on use. Sublessee acknowledges that it has checked applicable restrictions, laws,
building codes, zoning requirements, rules, regulations and ordinances to determine that the Sublessee’s
intended use of the Demised Premises is authorized and permitted by law.
ARTICLE VI.
DESIGN, CONSTRUCTION, INSTALLATION AND LIEN CLAIMS
Section 6.1. Construction of Improvements. Promptly after the Commencement Date, each
party agrees to use commercially reasonable efforts to cause the Improvements required of the respective
party to be constructed on the Demised Premises all in accordance with the terms of this Sublease and the
Sublessor Plans and Specifications and Sublessee Plans and Specifications. Such construction shall be
done in a workmanlike manner and with the use of quality materials. Construction of the Sublessee
Improvements and the Sublessor Improvements shall be at the constructing party’s respective risk and each
party shall pay promptly all costs of construction associated with the portion of the Improvements for which
it is responsible, which shall include, but not by way of limitation, (a) all contract charges (labor, material
and services furnished by contractors and subcontractors), (b) all costs of labor and material, (c) engineering
costs, and (d) all other costs and expenses (insurance, administrative, governmental permits, zoning, etc.),
including, but not limited to, the cost of site clearing, site preparation, fill, compaction and grading with
soil acceptable to build the proposed Improvements. As between Sublessor and Sublessee, construction
of the Sublessor Improvements and the Sublessee Improvements shall conclusively be deemed to be
substantially completed upon delivery to Sublessee of a certificate of occupancy signed by a City building
inspector or any other applicable authority for the Marina Facilities, which must include 399 wet slips or
such greater number of wet slips as Sublessee, in its sole discretion, determined was reasonable and prudent
to construct (up to and not to exceed the permitted number), ready for use and all necessary infrastructure
improvements necessary on the Demised Premises which are required by the applicable authorities prior to
Sublessee open operations consistent with the Permitted Uses.
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Sublessor will use commercially reasonable efforts to complete the Sublessor Improvements within
twenty-four (24) months after the Commencement Date (subject to Force Majeure) (the “Sublessor
Completion Deadline”). Upon substantial completion of the Sublessor Improvements, Sublessor will
deliver written notice to Sublessee. If from time to time Sublessor desires, in its sole discretion, to construct
additional improvements not mentioned in the Sublessor Plans and Specifications, Sublessor will deliver
written notice to Sublessee and Sublessee will have thirty (30) days to approve or disapprove Sublessor’s
request to construct the additional Sublessor improvements. Such approval by Sublessee will not be
unreasonably withheld, conditioned or delayed. The parties agree that Sublessee’s consent is not required
in the event Sublessor makes non-material modifications and changes to the Sublessor Improvements.
Sublessee will use commercially reasonable efforts to complete the Initial Sublessee Improvements
within twenty-four (24) months after the Commencement Date subject to Force Majeure (the “Sublessee
Completion Deadline”). Notwithstanding the foregoing, Sublessor and Sublessee acknowledge and agree
that until such time as Sublessor delivers a written notice to Sublessee regarding the substantial completion
of the Sublessor Improvements, Sublessee will utilize the Temporary Construction Access to access and
construct the Initial Sublessee Improvements. Upon substantial completion of the Initial Sublessee
Improvements, Sublessee will deliver written notice to Sublessor. If from time to time Sublessee desires,
in its sole discretion, to construct additional improvements not mentioned in the Sublessee Plans and
Specifications, Sublessee will deliver written notice to Sublessor and Sublessor will have thirty (30) days
to approve or disapprove Sublessee’s request to construct the additional Sublessee improvements. Such
approval by Sublessor will not be unreasonably withheld, conditioned or delayed. The parties agree that
Sublessor’s consent is not required in the event Sublessee makes non-material modifications and changes
to the Sublessee Improvements.
If the Sublessor Improvements have not been substantially completed prior to the substantial
completion of the Initial Sublessee Improvements, then the Commencement Date (as defined in Section
1.1.(5) above) shall automatically be extended by one day for each day after the substantial completion of
the Initial Sublessee’s Improvements that it takes Sublessor to reach substantial completion of the Sublessor
Improvements.
Notwithstanding anything to the contrary contained herein, Sublessee will contribute to Sublessor
$1,000,000.00 of the total costs of Sublessor Improvements (the “Infrastructure Contribution”). Upon
satisfaction of the conditions set forth in Section 6.6 below and execution by Sublessor and the contractor
of the construction contract for the Sublessor Improvements, Sublessee will escrow 20% of the
Infrastructure Contribution with Republic Title of Texas, Inc. or such other escrow agent agreed upon by
Sublessor and Sublessee pursuant to a separate written escrow agreement (the “Infrastructure Escrow
Agreement”). The Infrastructure Escrow Agreement will provide for (i) Sublessee to deposit the
remaining 80% of the Infrastructure Contribution by depositing a minimum of an additional 20% of the
Infrastructure Contribution every 45 days until the full amount of the Infrastructure Contribution has been
deposited into escrow under the Infrastructure Escrow Agreement, (ii) the right of Sublessor to require
Sublessee’s minimum periodic deposits to be more than 20% by notifying Sublessee in writing at least 25
days prior to the due date of the next deposit of the larger amount needed to be deposited by Sublessee (up
to the full amount of the Infrastructure Contribution) in order to meet an upcoming draw request by
Sublessor under the Infrastructure Escrow Agreement, (iii) Sublessee to deliver to Sublessor an irrevocable
standby letter of credit for the undeposited portion of the Infrastructure Contribution with a term of six (6)
months (which letter of credit will terminate when the full amount of the Infrastructure Contribution has
been deposited into escrow under the Infrastructure Escrow Agreement), and (iv) a draw request procedure
by which Sublessor can use the Infrastructure Contribution to pay for a portion of the Sublessor
Improvements.
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Sublessee shall have the right to install its merchandise, goods, and fixtures and equipment on the
Demised Premises during the completion of the Sublessor Improvements by Sublessor. Each party agrees
to indemnify and hold harmless the other party against any loss, liability or damage resulting from each
party’s (or its agents or contractors) construction of their respective portion of the Improvements.
Section 6.2. Ownership of Improvements. All of the Sublessee Improvements, and all other
improvements of any nature constructed by Sublessee on the Demised Premises including alterations,
modifications, and additions of the Improvements pursuant to the provisions of this Sublease, shall be
owned by and shall be the property of Sublessee. Upon the termination of this Sublease by reason of a
Sublessee Event of Default, Sublessor will own the Sublessee Improvements and all parts thereof after the
date of termination of this Sublease. Subject to the provisions of Article XII hereof, Sublessee shall deliver
the Demised Premises to Sublessor in reasonably good condition, actual wear and tear excepted, upon the
termination or expiration of the term of this Sublease.
Section 6.3. Construction Costs. Sublessee shall pay the actual cost and expense incurred in
construction of the Sublessee Improvements, in accordance with the Sublessee Plans and Specifications
prepared by Sublessee and approved by Sublessor and Sublessor shall pay the actual cost and expense
incurred in construction of the Sublessor Improvements (the “Construction Costs”), in accordance with
the Sublessor Plans and Specifications prepared by Sublessor and approved by Sublessee. However, if the
estimated Construction Costs for the Sublessor Improvements exceed $7,800,000.00, then (a) Sublessor
may change the scope and type of improvements that will be included in the Sublessor Improvements in
order to keep the Construction Costs for the Sublessor Improvements within the $7,800,000.00 budget, (b)
except as provided in subsections (c) and (d) of this Section 6.3, such changes may be made without
Sublessee’s consent, but Sublessor will notify Sublessee in writing of any changes to the scope or type of
Sublessor Improvements, (c) if such changes to the plans for Sublessor Improvements will reduce the
number of parking spaces below what is required by the Governmental Regulations to operate the maximum
number of wet slips included in the Sublessee Plans and Specifications for the Sublessee Improvements,
Sublessor must obtain Sublessee’s prior written approval of such changes, which approval will not be
unreasonably withheld, conditioned, or delayed, and (d) if such changes will be to the scope, type or location
of utilities serving the Demised Premises, Sublessor must obtain Sublessee’s prior written approval of such
changes, which approval will not be unreasonably withheld, conditioned or delayed. Except as provided
in Section 6.1 above, under no circumstances whatsoever shall the non-responsible party be obligated to
make any payments or incur any expense in connection with construction of Improvements by the other
party.
Section 6.4. Force Majeure. The time for the performance of Sublessee’s and Sublessor’s
obligations relative to the construction, restoration, repair, operation and maintenance of the Improvements
as provided for in this Sublease shall be extended for the period that such performance is prevented by
failures or delays in a party’s performance of its obligations hereunder caused by acts of God, acts of the
public enemy, wars, blockades, epidemics, earthquakes, floods, explosions, strikes, riots, insurrections, or
lawful acts of any governmental agency or authority restricting or curtailing the construction of the
Improvements or withholding or revoking necessary consents, approvals, permits or licenses or failure or
inability to procure and obtain needed building materials (provided such party who is unable to do so makes
reasonable efforts to procure satisfactory substitute materials if practical) whether as a result (directly or
indirectly) of any lawful order, law or decree of any governmental authority or agency or otherwise
(collectively, “Force Majeure”). The inability of a party to secure funds required to perform its
agreements hereunder shall not constitute Force Majeure. Upon occurrence of an event of Force Majeure
the affected party will deliver notice thereof to the other party so that the parties can keep track of the
number of days of delay that are attributable to Force Majeure. The parties agree that in no event may the
completion of the Sublessee Improvements or the Sublessor Improvements be delayed more than twelve
(12) months in the aggregate for Force Majeure causes.
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Section 6.5. Sublessee’s Work. Except as otherwise expressly provided herein, Sublessee
shall have no right, authority or power to bind Sublessor, or any interest of Sublessor in the Demised
Premises, for any claim for labor or material or for any other charge or expense incurred in connection with
any construction work done by Sublessee within the Demised Premises or any change, alteration or addition
thereto, or replacement or substitution therefor, nor to render the Sublessor’s interest in the Demised
Premises liable to any lien or right of lien for any labor or material or any other charge or expense incurred
in connection therewith, and Sublessee shall in no way be considered as the agent of Sublessor in the
construction of operation of the Improvements or any replacement or substitution therefor.
Section 6.6. Zoning, Permits & Approval of Corps and City. Irrespective of any other
provisions of this Sublease or additions thereto, the obligations of Sublessor and Sublessee under this
Sublease are conditioned upon (a) approval of the Sublessor Plans and Specifications and Sublessee Plans
and Specifications for the Improvements by the Corps and the City, (b) replatting of the Property, if
necessary, in accordance with applicable law, and (c) the issuance of appropriate building permits for the
construction of the Improvements upon the Demised Premises. Sublessor hereby agrees to cooperate fully
with Sublessee in securing the aforesaid permits and approvals as they relate to the Sublessee
Improvements, at no cost to Sublessor, including, but not limited to, timely executing applications for such
permits and approvals and hereby grants Sublessee the right to make application for them in the name of
Sublessor, if necessary. Sublessee agrees that all plans for the Sublessee Improvements must be submitted
first to Sublessor for review and approval and, upon Sublessor’s approval, then may be submitted to the
City for review and approval. As requested by the Corps, all submittals of such plans to the Corps will be
made by the City rather than by Sublessor or Sublessee. If required by the District Engineer or the City,
Sublessee will deliver complete “as built” construction plans of the Sublessee Improvements to the District
Engineer, the City and Sublessor upon completion of the Sublessee Improvements. All expenses incurred
by Sublessee or Sublessor in obtaining the permits and authorizations referred to in this Paragraph shall be
the responsibility of the party responsible for the construction of the respective Improvements and the other
party shall have no liability for the permitting costs associated with Improvements for which they are not
responsible.
Section 6.7. Discharge of Liens. If any mechanic’s, materialman’s or other types of liens or
lien claims are filed against the whole or any part of the Demised Premises, arising or resulting from actions
or omissions by the constructing party, then the constructing party shall promptly secure their release, or if
the constructing party wishes to contest any such lien or claim and has a reasonable basis for a contest, the
constructing party may do so, but only if the constructing party furnishes the non-constructing party with
surety bonds or escrow funds (“Construction Security”) sufficient in amount to protect the non-
constructing party’s interest in the Demised Premises and the parties’ interests in this Sublease during the
pendency of the contest. If the constructing party does not secure a lien release or furnish Construction
Security, such failure shall constitute an event of default by the constructing party hereunder and, in addition
to all other rights and remedies available to the non-constructing party by reason thereof, the non-
constructing party may, after thirty (30) days’ prior written notice, pay such lien or claim and secure such
release, and the constructing party shall be obligated to reimburse the non-constructing party for all sums
reasonably expended by the non-constructing party in paying such lien or claim and securing such release,
including attorney’s fees, plus interest at the highest lawful rate from the date of the non-constructing
party’s payment until it is reimbursed. Nothing contained in this Section 6.7 or elsewhere in this Sublease
shall be deemed or construed as an authorization by or consent of Sublessor or Sublessee to the filing of
any mechanic’s or materialman’s lien against all or any portion of the Demised Premises or any interest
therein.
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ARTICLE VII.
SECURING GOVERNMENTAL APPROVALS AND COMPLIANCE WITH LAW
Section 7.1. Compliance with Laws.
Section 7.1.(1).
(a) Subject to the provision of subsection (b) below, Sublessee, at Sublessee’s sole cost and
expense, shall obtain any and all governmental licenses, permits, and approvals necessary to
construct or install the Sublessee Improvements and to allow the use and occupancy of the Demised
Premises. Sublessee shall comply and shall require any sub-sublessees of the Demised Premises
comply, at all times with (i) all applicable Governmental Regulations for the use of the Demised
Premises, and (ii) all governmental orders for the correction, prevention and abatement of nuisances
arising from Sublessee’s and/or the sub-sublessees use of the Demised Premises, all at Sublessee’s
and/or sub-sublessee’s sole cost and expense.
(b) Sublessor, at Sublessor ‘s sole cost and expense, shall obtain any and all governmental
licenses, permits, and approvals necessary to construct or install the Sublessor Improvements and,
as part of substantial completion, either a City acceptance letter for civil plan improvements or a
certificate of occupancy, as applicable, for the Park Facilities, Park Area, and Parking. Sublessor’s
obligations under this subsection (b) terminate as of the substantial completion date of the Sublessor
Improvements.
Section 7.1.(2).
(a) Subject to the provisions of subsection (b) below, Sublessee shall procure at its sole
expense any permits and licenses required for the transaction of business in the Demised Premises
and/or in any way related to the Demised Premises and shall comply with all laws, ordinances,
regulations and orders now in effect or hereafter enacted or passed during the term of this Sublease
insofar as the Demised Premises and any signs of Sublessee are concerned, and shall, except as
herein otherwise provided, make at Sublessee’s own cost and expense all repairs, additions and
alterations to the Demised Premises ordered or required by any governmental authorities, whether
in order to meet the special needs of Sublessee, or by reason of the occupancy of Sublessee, or
otherwise.
(b) Prior to substantial completion of the Sublessor Improvements, Sublessor shall procure at
its sole expense any permits and licenses required for Sublessor’s transaction of business in or use
of the Park Area and Park Facilities and shall comply with all laws, ordinances, regulations and
orders now in effect or hereafter enacted or passed prior to the substantial completion of the
Sublessor Improvements. Sublessor’s obligations under this subsection (b) terminate as of the
substantial completion date of the Sublessor Improvements.
Section 7.1.(3).
(a) Sublessee’s compliance with all applicable laws, rules, and regulations shall include, but
not be limited to, full compliance with (a) all federal, state, and local laws, rules, and regulations
concerning the possession, storage, use, disposal of and clean-up relating to any and all types of
hazardous wastes, as the term “Hazardous Wastes” is defined by applicable Governmental
Regulations, and (b) the Americans with Disabilities Act and Americans with Disabilities Act
Accessibility Guidelines as they apply to the Sublessee Improvements and, after the substantial
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completion date of the Sublessor Improvements, as they apply to the Sublessor Improvements for
any changes required after the substantial completion date that are made by Sublessee.
(b) Sublessor’s compliance with all applicable laws, rules, and regulations shall include, but
not be limited to, full compliance with (a) all federal, state, and local laws, rules, and regulations
concerning the possession, storage, use, disposal of and clean-up relating to any and all types of
hazardous wastes, as the term “Hazardous Wastes” is defined by applicable Governmental
Regulations, and (b) the Americans with Disabilities Act and Americans with Disabilities Act
Accessibility Guidelines as they apply to the Sublessor Improvements prior to the substantial
completion date. During the construction of the Sublessor Improvement until the substantial
completion date of the Sublessor Improvements, Sublessor shall be responsible for compliance with
Governmental Regulations applicable to the construction of the Sublessor Improvements.
Sublessor’s obligations under this subsection (b) terminate as of the substantial completion date of
the Sublessor Improvements.
Section 7.1.(4).
(a) Subject to the provisions of subsection (b) below, Sublessee shall obtain any and all needed
regulatory approvals, licenses, and/or permits relating to the operation of its business, its occupancy
of the Demised Premises, and any other such approvals, licenses or permits relating in any way to
the Demised Premises during the Primary Sublease Term, including, but not limited to, any such
governmental approvals, permits or licenses relating to chemicals, petroleum products, hazardous
materials, as the term “Hazardous Materials” is defined by applicable Governmental Regulations,
and/or Hazardous Wastes possessed, used, or stored on the Demised Premises by Sublessee.
Sublessee acknowledges that the Corps Lease requires prior written approval of the District
Engineer for any pesticides or herbicides before they are applied to the Demised Premises.
(b) Prior to substantial completion of the Sublessor Improvements, Sublessor shall obtain any
and all needed regulatory approvals, licenses, and/or permits relating to the operation of its business
and use of the Park Area, Park Facilities, and Parking, and any other such approvals, licenses or
permits relating in any way to Sublessor’s use of the Park Area, Park Facilities, and Parking,
including, but not limited to, any such governmental approvals, permits or licenses relating to
chemicals, petroleum products, hazardous materials, as the term “Hazardous Materials” is
defined by applicable Governmental Regulations, and/or Hazardous Wastes possessed, used, or
stored on the Park Area and Parking by Sublessor. Sublessor acknowledges that the Corps Lease
requires prior written approval of the District Engineer for any pesticides or herbicides before they
are applied to the Park Area and Parking. Sublessor’s obligations under this subsection (b)
terminate as of the substantial completion date of the Sublessor Improvements.
Section 7.1.(5).
(a) Subject to the provisions of subsection (b) below, in the event of any accident or spillage
of any petroleum product, chemical, toxic compound, Hazardous Materials and/or Hazardous
Wastes on or at the Demised Premises during the Primary Sublease Term, as may be extended,
Sublessee shall comply with all federal, state and local laws, rules, and regulations pertaining
thereto, including notification of proper authorities, safety of all persons potentially affected,
evacuation of Demised Premises if necessary, clean-up and disposal. Additionally, Sublessee
shall be solely responsible for all costs associated with any spillage of any such compounds or
wastes on or at the Demised Premises and for the clean-up and disposal of any such compounds,
including Hazardous Wastes, on the Demised Premises which occur during the Primary Sublease
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Term, as extended, in accordance with applicable laws, rules, and regulations unless and to the
extent caused by negligent act or omission of Sublessor.
(b) In the event of any accident or spillage of any petroleum product, chemical, toxic
compound, Hazardous Materials and/or Hazardous Wastes resulting from, caused by or arising out
of Sublessor or Sublessor’s employees, contractors or agents’ use of and activities on or at the Park
Area and Parking prior to the substantial completion of the Sublessor Improvements, Sublessor
shall comply with all federal, state and local laws, rules, and regulations pertaining thereto,
including notification of proper authorities, safety of all persons potentially affected, evacuation of
Park Area and Parking if necessary, clean-up and disposal. Additionally, Sublessor shall be solely
responsible for all costs associated with any spillage of any such compounds or wastes on or at the
Park Area and Parking and for the clean-up and disposal of any such compounds, including
Hazardous Wastes, on the Park Area and Parking which occur prior to the substantial completion
date of the Sublessor Improvements and which are resulting from, caused by or arising out of
Sublessor or Sublessor’s employees or contractors’ use of and activities on or at the Park Area and
Parking prior to the substantial completion date of the Sublessor Improvements in accordance with
applicable laws, rules, and regulations. Sublessor’s obligations under this subsection (b) terminate
as of the substantial completion date of the Sublessor Improvements.
Section 7.2. Environmental Covenants.
Section 7.2.(1).
(a) Subject to the covenants of Sublessor set forth herein and the provisions of subsection 7.2.1.(b)
below, Sublessee covenants that during the Primary Sublease Term, as may be extended (a)
Sublessee shall not permit any toxic or hazardous substances, including, without limitation,
asbestos and the group of organic compounds known as polychlorinated biphenyls, to be generated,
treated, stored or disposed of, or otherwise deposited in or located on, or released on or to the
Demised Premises, including, without limitation, the surface the subsurface waters of the Demised
Premises, (b) Sublessee will not engage in and will not permit any other party to engage in any
activity on the Demised Premises which would cause (i) the Demised Premises to become a
hazardous waste treatment storage or disposal facility within the meaning of, or otherwise bring
the Demised Premises within the ambit of, the Resource Conservation and Recovery Act of 1975
(“RCRA”), 42 U.S.C. ‘6901, et seq., as amended, or any similar state law or local ordinance or
other environmental law, (ii) a release or threatened release of a hazardous substance from or to the
Demised Premises within the meaning of, or otherwise bring the Demised Premises within the
ambit of, the Comprehensive Environmental Response, Compensation and Liability Act of 1980
(“CERCLA”), 42 U.S.C. ‘9601-9657, as amended, or any similar state law or local ordinance of
any other environmental law, or (iii) the discharge of pollutants or effluents into any water source
or system, or the discharge into the air of any emissions, which would require a permit under the
Federal Water Pollution Control Act, 33 U.S.C. ‘1251, et sea., or the Clean Air Act, 42 U.S.C.
‘7401, et seq., or any similar state law or local ordinance or any other environmental law, (c)
Sublessee will not permit any substance or conditions in or on the Demised Premises which might
support a claim or causes of action under RCRA, CERCLA, or any other federal, state or local
environmental statutes, regulations, ordinances or other environmental regulatory requirements,
and (d) no underground storage tank will be located on or under the Demised Premises, except as
presently exists or as approved by Sublessor, the City, the Corps, and the other applicable
authorities. As used herein, the terms “hazardous substance” and “release” shall have the
meanings specified in CERCLA, and the terms “solid waste” and “disposal” (or “disposed”) shall
have the meanings specified in RCRA; provided, in the event either CERCLA or RCRA is amended
so as to broaden the meaning of any term defined thereby, such broader meaning shall apply
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subsequent to the effective date of such amendment, provided further, to the extent that the laws of
the State of Texas establish a meaning for such terms which is broader than that specified in either
CERCLA or RCRA, such broader meaning shall apply.
(b) Sublessor covenants that prior to substantial completion of the Sublessor Improvements (a)
Sublessor shall not permit any toxic or hazardous substances, including, without limitation,
asbestos and the group of organic compounds known as polychlorinated biphenyls, to be generated,
treated, stored or disposed of, or otherwise deposited in or located on, or released on or to the Park
Area and Parking, including, without limitation, the surface the subsurface waters of the Park Area
and Parking, (b) Sublessor will not engage in and will not permit any other party to engage in any
activity on the Park Area and Parking which would cause (i) the Park Area and Parking to become
a hazardous waste treatment storage or disposal facility within the meaning of, or otherwise bring
the Park Area and Parking within the ambit of, the Resource Conservation and Recovery Act of
1975 (“RCRA”), 42 U.S.C. ‘6901, et seq., as amended, or any similar state law or local ordinance
or other environmental law, (ii) a release or threatened release of a hazardous substance from or to
the Park Area and Parking within the meaning of, or otherwise bring the Park Area and Parking
within the ambit of, the Comprehensive Environmental Response, Compensation and Liability Act
of 1980 (“CERCLA”), 42 U.S.C. ‘9601-9657, as amended, or any similar state law or local
ordinance of any other environmental law, or (iii) the discharge of pollutants or effluents into any
water source or system, or the discharge into the air of any emissions, which would require a permit
under the Federal Water Pollution Control Act, 33 U.S.C. ‘1251, et sea., or the Clean Air Act, 42
U.S.C. ‘7401, et seq., or any similar state law or local ordinance or any other environmental law,
and (c) Sublessor will not permit any substance or conditions in or on the Park Area and Parking
which might support a claim or causes of action under RCRA, CERCLA, or any other federal, state
or local environmental statutes, regulations, ordinances or other environmental regulatory
requirements. Sublessor’s obligations under this subsection (b) terminate as of the substantial
completion date of the Sublessor Improvements.
Section 7.2.(2). In the event Sublessee or Sublessor is obligated by any applicable federal, state
or local law, ordinance or regulation or otherwise directed by any governmental agency or authority, to
clean up, remove or encapsulate or cause the clean-up, removal, or encapsulation of any Hazardous Wastes
and/or Hazardous Materials or asbestos or material containing asbestos (“Asbestos”) from the Demised
Premises, the responsible party hereby guarantees to the non-responsible party it shall (i) promptly
undertake to arrange for such clean up, removal and disposal in accordance with all Governmental
Regulations, (ii) exercise its best efforts to insure that such clean up and removal shall be conducted in a
timely and diligent manner, and (iii) assume the costs and expense, including any fines, of such clean up
and removal.
Section 7.2.(3). In the event that any lien is recorded or filed against the Demised Premises
pursuant to any Governmental Regulations regarding Hazardous Materials, Hazardous Wastes, or Asbestos,
Sublessee hereby guarantees to Sublessor that Sublessee shall, not later than thirty (30) days following the
filing of such lien, satisfy the claim and cause the lien thereunder to be discharged of record (whether by
payment, bonding or as otherwise provided by Section 7.2 hereof) unless such lien was caused by Sublessor
or resulted from any act of Sublessor.
Section 7.2.(4).
(a) In addition to the foregoing and subject to Sublessor’s obligations set forth in this Article
VII, Sublessee shall protect, defend, indemnify and save harmless Sublessor, and Sublessor’s
agents, employees and representatives from and against all loss (including diminution in the value
of the Demised Premises), cost, damage, liability, obligation, causes of action, fine, penalty or
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expense (including attorneys’ fees and expenses for investigation, inspection, removal, clean up,
and remedial costs incurred to permit continued or resume normal operation of the Demised
Premises), imposed upon or incurred by or asserted against Sublessor by reason of the following
occurrences during the Primary Sublease Term, as may be extended (i) the presence, disposal,
escape, seepage, leakage, spillage, discharge, emission, release, or threatened release of any
Hazardous Materials and/or Hazardous Wastes on, from, or affecting the Demised Premises or any
other property or the presence of Asbestos on the Demised Premises; (ii) any personal injury
(including wrongful death) or property damage (real or personal) arising out of or related to such
Hazardous Wastes, Hazardous Materials or Asbestos; (iii) any lawsuit brought or threatened,
settlement reached, or government order relating to such Hazardous Wastes, Hazardous Materials
or Asbestos; or (iv) any violation of laws, orders, regulations, requirements, or demands of
governmental authorities, which are based upon or in any way related to such Hazardous Wastes,
Hazardous Materials or Asbestos including, without limitation, the costs and expenses of any
remedial action, attorney and consultant fees, investigation and laboratory fees, court costs, and
litigation expenses unless any such loss was caused by Sublessor or resulted from any act of
Sublessor.
(b) In addition to the foregoing and subject to Sublessee’s obligations set forth in this Article
VII, Sublessor shall protect, defend, indemnify and save harmless Sublessee, and Sublessee’s
agents, employees and representatives from and against all loss (including diminution in the value
of the Demised Premises), cost, damage, liability, obligation, causes of action, fine, penalty or
expense (including attorneys’ fees and expenses for investigation, inspection, removal, clean up,
and remedial costs incurred to permit continued or resume normal operation of the Demised
Premises), imposed upon or incurred by or asserted against Sublessee by reason of Seller’s breach
of Section 7.1.(3).(b), Section 7.1.(4).(b), Section 7.1.(5).(b), Section 7.2.(1).(b). or Section 7.2.(2).
Section 7.3. Storage Tanks. Sublessee shall be responsible for all existing fuel storage tanks
and lines located on the Demised Premises, including any maintenance, labor, and costs to keep current
with federal guidelines and any that Sublessee installs as permitted herein. Sublessee shall provide
annually to Sublessor all documentation that the fuel storage tanks have been maintained and are in
compliance with all laws and requirements of the underground storage tanks division of the applicable
jurisdiction and any other regulatory authorities. Notwithstanding anything to the contrary in this Sublease
and at all times during the term of this Sublease, Sublessor shall provide paved vehicular access to the Fuel
Tank for filling, operation and maintenance on an as needed, when needed basis, including but not limited
to access and accommodation sufficient for large ton and 18 wheel fuel trucks.
Section 7.4. Corps Lease and City Sublease. Sublessee agrees to comply with all provisions
under the Corps Lease and the City Sublease regarding Hazardous Materials or Hazardous Wastes and to
the extent there is a conflict among such provisions in this Sublease, the City Sublease and the Corps Lease,
the more restrictive requirement will apply.
Section 7.5. Environmental Baseline. Notwithstanding anything to the contrary contained
herein, not less than thirty (30) days prior to the earlier of: (i) the date Sublessor commences construction
of the Sublessor Improvements; or (ii) the date Sublessee commences construction of the Sublessee
Improvements, Sublessee shall cause a Phase I Environmental Site Assessment (“ESA”) shall be performed
on the Demised Premises at Sublessee’s sole cost. Further, if the ESA recommends a Phase II ESA then
a Phase II ESA shall also be performed (the Phase I ESA and any applicable Phase II ESA shall form the
“Environmental Baseline” for this Sublease. Any covenant, obligation or indemnity of Sublessee set
forth in this Article VII shall not extend to any claim, demand, fine, penalty, cause of action, liability,
damage, loss, cost or expense related to the presence of Hazardous Substances that are documented in the
Environmental Baseline.
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ARTICLE VIII.
TAXES
Section 8.1. Taxes and Assessments. From and after the Effective Date, Sublessee shall pay,
before they become delinquent, all ad valorem taxes, assessments and other governmental charges and
impositions levied or assessed against Sublessee’s fixtures, equipment and personal property on, attached
to, or used in connection with the Demised Premises or any part thereof; provided, however, that if any tax
is payable in installments, Sublessee may also pay in installments, but all such taxes shall be paid in full
prior to the expiration of the Primary Sublease Term, as may be extended if applicable. Sublessor shall
promptly present Sublessee with copies of all tax bills received for each lease year for which Sublessee is
expressly responsible. Sublessee shall pay before they become delinquent all property taxes, assessments
and other governmental charges and impositions levied or assessed against the Demised Premises or any
part thereof, and the Sublessee Improvements. Sublessee shall have the right at Sublessee’s election to
protest the levy, assessment or collection of any taxes, assessments, charges or impositions by appropriate
legal action, provided that Sublessee shall not thereby permit any lien (other than the lien for current taxes
not yet due and payable) or judgment for any taxes, assessments, charges or impositions to be filed or
enforced against the Demised Premises. Upon the written request of Sublessee, Sublessor will join with
Sublessee in any such protest on the condition that Sublessee pay all of the reasonable costs and expenses
(including reasonable attorneys’ fees and expenses) incurred by Sublessor in connection with this joinder.
ARTICLE IX.
INSURANCE
Section 9.1. Insurance Requirements for Sublessee. From and after the Effective Date,
Sublessee shall maintain, at Sublessee’s sole cost and expense, insurance on the Demised Premises as
follows:
(1) Sublessee Improvements. “Special Risk” Property Insurance against loss or damage to
Sublessee Improvements inclusive of Flood and Earthquake coverage, in amounts equal to the full
replacement cost, of Sublessee Improvements, as determined by insurance appraisals, one initially
conducted on or about the Commencement Date, and every lease year thereafter.
(2) Commercial General Liability. Commercial general liability insurance against claims
for bodily injury, death or property damage occurring on the Demised Premises in the amount of $5,000,000
and in the aggregate, with financially sound companies reasonably acceptable to Sublessor that have an
AM Best Rating of A-/VII or greater. Such limits shall be on a per location basis and may be achieved in
combination of primary and excess policies. This coverage may be increased periodically to a level
appropriate under then market conditions and industry standards, as reasonably approved by the parties.
(3) Workers Compensation. Statutory Workers Compensation insurance covering all
persons employed by Sublessee in connection with any work done on the Demised Premises. Such
insurance shall also contain a $1,000,000 Employers Liability limit.
(4) Business Interruption Insurance. Business Interruption Insurance, providing in the
event of damage or destruction of the Demised Premises an amount sufficient to sustain Sublessee for a
period of not less than one (1) year for: (i) the net profit that would have been realized had Sublessee’s
business continued; and (ii) such fixed charges and expenses as must necessarily continue during a total or
partial suspension of business to the extent to which they would have been incurred had no business
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interruption occurred, including, but not limited to, interest on indebtedness of Sublessee, taxes and rents,
and insurance premiums, and depreciation.
(5) Marina Operator’s Legal Liability. Sublessee shall maintain Marina Operators Legal
Liability including Protection and Indemnity with limits not less than $2,000,000. Such insurance shall
provide care, custody and control coverage and primary P&I coverage for any vessel that Sublessee owns,
leases or operates.
(6) Auto Insurance. In owned, leases, hired, or non-owned vehicles are used by Sublessee
in connection with this Agreement, Sublessee shall maintain Auto Liability coverage in the amount of
$1,000,000 Combined Single Limit for Bodily Injury and Property Damage.
Each of Sublessor, the Corps and the City shall be an additional insured inclusive of ongoing and completed
operations per ISO forms CG 2010 and CG 2037 or equivalent, on all of the above policies (except the
Workers Compensation coverage) and shall annually be provided with confirmation that these coverages
are being maintained. The policies outlined in subsections 9.1.(2), 9.1.(4) and 9.1.(6) shall be primary and
non-contributory to any insurance that Sublessor, the Corps and the City may carry. Sublessee will
endeavor to deliver a copy of each of the above policies to Sublessor, the City and the Corps within ten (10)
days after the Commencement Date and thereafter a certificate of insurance evidencing the renewal at least
five (5) days prior to the expiration of each policy (and, upon Sublessor’s written request, Sublessee will
deliver a copy of the policy that was renewed). With respect to lien documents executed by Sublessee in
connection with the Demised Premises, Sublessee shall obtain the agreement of the Leasehold Mortgagee
to permit the proceeds of casualty insurance to be used to reconstruct or replace the damaged Improvements.
Sublessee agrees that to the extent there is a conflict between the insurance requirements in this Sublease,
the City Sublease or the Corps Lease, the higher standard will apply under this Sublease. Such policies
shall also be endorsed to provide to Sublessor thirty (30) days’ notice of cancellation or non-renewal, or
material change in coverage. The policies outlined in Sections 9.1.(2), 9.1.(4), and 9.1.(6) shall be primary
and non-contributory to any insurance that Sublessor, the Corps or the City may carry.
Section 9.2. Insurance Requirements for Sublessor Improvements. From and after the
Effective Date, Sublessor or Sublessee, as applicable, will maintain the following insurance on the Park
Area and Sublessor Improvements:
(1) From the Effective Date and through the date of substantial completion of the Sublessor
Improvements, Sublessor shall maintain, at its expense, commercial general liability insurance against
claims for bodily injury, death or property damage occurring on, in or about the Park Area in an amount
which is the lesser of the actual costs incurred by Sublessor for hard costs of construction of the Sublessor
Improvements or $5,000,000 and in the aggregate, with financially sound companies that have an AM Best
Rating of A-/VII or greater. Such limits shall be on a per location basis and may be achieved in
combination of primary and excess policies. This coverage may be increased periodically to a level
appropriate under then market conditions and industry standards, as reasonably approved by the parties.
(2) As of the date of substantial completion of the Sublessor Improvements and continuing for
the term of this Sublease, Sublessee shall maintain, at its expense, commercial general liability insurance
against claims for bodily injury, death or property damage occurring on, in or about the Demised Premises
that includes the Sublessor Improvements in the aggregate amount of the lesser of (i) $5,000,000; or (ii) the
total hard costs incurred by Sublessor for the construction of the Sublessor Improvements. Such limits may
be achieved in combination of primary and excess policies.
Section 9.3. Waiver of Subrogation. Anything in this Sublease to the contrary
notwithstanding, Sublessor and Sublessee each hereby waive any and all rights of recovery, claim, action,
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or cause of action, against the other, its agents, officers, or employees, for any loss or damage arising from
any cause covered by insurance required to be carried by each of them pursuant to this Sublease or any
other insurance actually carried by each of them, regardless of cause or origin, including negligence of the
other party hereto, its agents, officers, or employees, and covenants that no insurer shall hold any right of
subrogation against such other party. All insurance obtained by either Sublessee or Sublessor hereunder,
especially including the property damage insurance described herein shall contain appropriate waiver of
subrogation rights endorsements whereby the insurer releases all rights of subrogation against both
Sublessor and Sublessee and any and all sub-sublessees. Each party shall provide the other with copies of
such endorsements upon request.
ARTICLE X.
MAINTENANCE AND REPAIR; ALTERATIONS; UTILITIES; ACCESS; SECURITY
Section 10.1. Shoreline Erosion Control; Maintenance and Repair of Demised Premises.
(a) Subject to the provisions to Articles VI and XI hereof, Sublessee shall maintain in good
repair and condition the entire Demised Premises and all of the Sublessee Improvements, fixtures,
equipment and personal property on the Demised Premises, and keep them free from waste or
nuisance. Sublessee shall be responsible solely for the management of the Marina Shoreline
excluding costs associated with maintaining and repairing all or any portion of the shoreline and
erosion control with the exception of a one-time payment to Ark Contracting Services, LLC
(“Ark”) in the amount of $655,530.00 (the “Sublessee Revetment Payment”) as payment for the
“Total Project Cost” reflected on the shoreline erosion proposal from Ark dated November 11,
2022 attached as Exhibit “I.1” (the “Sublessee Erosion Control Proposal”), which amount
includes a twenty percent (20%) contingency. Sublessor shall be responsible for the management
of the Park Shoreline, including without exception Sublessor shall be responsible for the Sublessor
Revetment Costs. “Sublessor Revetment Costs” shall mean the sum of: (i) the actual costs to
construct the Park Shoreline as shown in Line Items 11 through 15 on the Shoreline Erosion Control
Proposal; and (ii) one-third of the costs required to address Items 1 through 7 of the Shoreline
Erosion Control Proposal, the total sum of which is estimated to be $708,744.00. The “Shoreline
Erosion Control Proposal” shall mean the shoreline erosion control proposal from Ark
Contracting Services, LLC (“Ark”) dated June 23, 2022 attached as Exhibit “I.2”. Notwithstanding
anything to the contrary in this Sublease, Sublessor and Sublessee acknowledge and agree that
Sublessee will not be responsible for any costs (other than the Sublessee Revetment Payment)
associated with or related to erosion control, maintenance and repair of the Marina Shoreline and
Park Shoreline. The parties agree that Sublessee shall maintain and operate the Sublessor
Improvements at Sublessee’s cost (except as otherwise provided below regarding the Parking Fee)
from and after the substantial completion date of the Sublessee Improvements. Sublessee agrees
to comply with the annual certification required under the Corps Lease certifying that all water and
sanitary systems on the Demised Premises have been inspected and comply with federal, state and
local standards. At the expiration of the Sublease, Sublessee shall deliver the Demised Premises
and the Improvements to Sublessor in good condition, subject to normal wear and tear.
(b) Parking. Sublessee intends to charge a fee to park in the Parking areas, which fee may
include a daily, monthly or annual use fee (each, a “Parking Fee” and collectively, the “Parking
Fees”). Sublessee will submit the proposed Parking Fees to the City for review as and when
required by the City. As of the date of execution of this Sublease, the City requires that any
Parking Fees be reviewed at least annually and any time Parking Fees are adjusted.
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(c) Maintenance and Repair of Sublessor Improvements and Park Shoreline. Notwithstanding
any provision to the contrary in this Sublease from the Effective Date to the substantial completion
date of the Sublessor Improvements, Sublessor shall, at Sublessor’s sole cost: (i) maintain in
compliance, good repair and condition the Sublessor Improvements; and (ii) manage and maintain
the Park Shoreline.
Section 10.2. Alterations. Sublessee shall have the right, from time to time, to make additions,
alterations and changes to the Sublessee Improvements, including but not limited to increase the number of
wet slips in the Marina Facilities (not to exceed the permitted number), in accordance with the Sublessee
Plans and Specifications. Sublessee shall have the right, from time to time, to make other additions,
alterations and changes to improvements not mentioned in the Sublessee Plans and Specifications as
approved by the Corps, City and Sublessor (hereinafter sometimes referred to collectively as “alterations”)
(which term shall, when used in this Section include any replacement or substitution therefor), provided
that (a) at the time of such alteration there is no uncured default by Sublessee under this Sublease, and (b)
the right to make alterations is subject to the following:
(1) no structural alterations of the original facade or exterior of the Sublessee Improvements
shall be commenced except after receipt of Sublessor’s written approval of such alterations, which approval
Sublessor agrees not to unreasonably withhold, and after receipt of the Corps’ and the City’s written
approval if required under the Corps Lease and City Sublease;
(2) no alterations shall be made which would impair the structural soundness of the Marina
Facilities;
(3) no alterations shall be undertaken until Sublessee has furnished Sublessor reasonable
evidence that all building permits, licenses and authorizations of all municipal departments and
governmental authorities having jurisdiction and all required consents of Leasehold Mortgagees and the
Corps and the City have been procured. Sublessor shall join, but without expense to Sublessor, in the
application for such permits, licenses or authorizations whenever such action is necessary and is requested
by Sublessee;
(4) no alterations shall be made which would be in violation of the terms and provisions of the
Corps Lease or City Sublease;
(5) any alterations shall be made within a reasonable time and in a good and workmanlike
manner and in substantial compliance with all applicable permits, licenses and authorizations, and building
laws and with all other Governmental Regulations; and
(6) Sublessee will upon demand by Sublessor give reasonably satisfactory proof or assurances
to Sublessor that the funds required to pay for such alterations are or will be available to Sublessee for such
purpose.
Section 10.3. Utilities. Sublessor is responsible, at its sole cost and expense, for obtaining and
installing all utility lines, connections and facilities to serve the overall Demised Premises, including but
not limited to delivering utility lines and connections to two (2) stubouts each located at the concrete pads
at the Top of the Flowage Easement near the Parking to serve the Marina Facilities in the location shown
on Exhibit “B” and as designated in the Sublessee Plans and Specifications and the Sublessor Plans and
Specifications (“Sublessor Utility Work”). Sublessor and Sublessee acknowledge and agree that Sublessor
will use its best efforts to bring utilities to various locations in the Demised Premises in an effort to minimize
Tenant’s costs related to extending and providing utilities to the Marina Facilities. After substantial
completion of the Sublessor Utility Work, Sublessor will deliver written notice to Sublessee that the
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Sublessor Utility Work is substantially complete (“Notice of Substantial Completion of Sublessor Utility
Work”). Upon receipt of the Notice of Substantial Completion of Sublessor Utility Work and thereafter,
Sublessee will be responsible for all costs for maintaining and repairing such utilities for the Demised
Premises to the extent they exclusively serve the Demised Premises (“Sublessee Utility Work”). Sublessor
shall pay all charges for water, electricity, gas, sewer, telephone or any other utility connections, tap-in fees
and services related to the installation and construction of the Sublessor Utility Work. From and after the
Effective Date and until Sublessee’s receipt of the Notice of Substantial Completion of Sublessor Utility
Work, Sublessor shall provide to Sublessor and Sublessee all utility services needed for the construction of
the Sublessor Improvements and the Sublessee Improvements. For such period prior to Sublessee’s receipt
of the Notice of Substantial Completion of Sublessor Utility Work and with respect to each party’s use of
utilities during construction, Sublessor and Sublessee agree to use reasonable efforts to monitor their
respective uses of utilities related to their respective construction obligations with the intent that the utility
costs will be divided between and paid for by Sublessor and Sublessee based on each party’s actual use and
the costs associated with such use. From and after Sublessee’s receipt of the Notice of Substantial
Completion of Sublessor Utility Work, Sublessee shall pay all charges for water, electricity, gas, sewer,
telephone or any other utility connections, tap-in fees and services furnished to the Demised Premises, or
if the utilities serve more than the Demised Premises then Sublessee shall only pay Sublessee’s allocable
share of the charges for water, electricity, gas, sewer, telephone or any other utility connections, tap-in fees
and services applicable to the Demised Premises. Sublessor shall in no event be liable or responsible for
any cessation or interruption in, or damage caused by, any such utility services; provided however, upon
substantial completion of the Sublessor Utility Work, Sublessor agrees to assign to Sublessee any and all
warranties from contractors under the construction contracts for the Sublessor Utility Work.
Section 10.4. License to Use the Park Facilities. Sublessor reserves and retains an irrevocable
license to use the Park Facilities and Parking (excluding the Fuel Tank and Trash Dumpster Area) , and
sidewalks and vehicular access drives within the Park Area, with all such areas as depicted on Exhibit “D”,
in favor of Sublessor, the Association and the City for (a) general, daily use of the Park Facilities and
Parking by members of the Association and by the public and (b) special events that may be planned by the
Association or the City (with any costs for such an event to be paid by the Association or the City, as
applicable) subject to the conditions and requirements in this Section 10.4 (“Special Events”), which
license reserved herein shall continue until the expiration or earlier termination of this Sublease. Conditions
for Special Events include, but are not limited to:
(a) Sublessor will provide the requirements for scheduling a Special Event to the Association
and the City, including, but not limited to, providing Sublessee not less than ninety (90) days’ prior written
notice of the City and Association’s desire to host a Special Event;
(b) Sublessee to provide its approval which will not to be unreasonably withheld or delayed;
(c) The planner of the Special Event (whether the Association or the City), at its sole cost,
shall obtain any required special event permits for City and Association Special Events;
(d) If required by the City, the planner of the Special Event (whether the Association or the
City) will annually obtain a Master Special Events Permit satisfying the requirements of the City’s Special
Events Guidelines to cover each of its Special Events to be held within the Park Area. If required by the
City, the planner of the Special Event (whether the Association or the City) will provide the City’s Tourism
& Culture Department with at least thirty (30) days’ prior written notice of its election to hold such Special
Event, along with the pertinent details relating to each proposed event, such as number of participants,
proposed uses, and times;
(e) Any proposed Special Event which contemplates (i) amplified sound, (ii) temporary
installation of structures requiring permits from agencies having jurisdiction, (iii) hours of operation which
extend beyond the hours of operation for the Park Area and Demised Premises, or (iv) dates for the proposed
Special Event that conflict with those high impact periods in which the City does not issue special event
permits (i.e., Spring Break) may require the approval of the City Manager; and
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(f) Such other reasonable requirements as Sublessee’s deems necessary based on the type of
Special Event.
Section 10.5. Security. Sublessee, at its sole cost and expense, is responsible for providing any
security within the Demised Premises that will reasonably ensure the safety of employees and patrons.
Neither Sublessor nor Sublessee shall permit or allow the use of the Demised Premises in any manner that
violates applicable laws or regulations or constitutes a hazard to the health, safety and/or welfare of the
public.
ARTICLE XI.
CASUALTY DAMAGE, DESTRUCTION AND CONDEMNATION
Section 11.1. Casualty Damage or Destruction.
(1) Sublessee’s and Sublessor’s Obligation to Restore. If the Sublessee Improvements or
any other improvements constructed by Sublessee hereafter situated on the Demised Premises during the
term of this Sublease are wholly or partially destroyed or damaged by fire, or any other casualty whatsoever,
Sublessee shall promptly repair, replace, restore or reconstruct the same in substantially the form in which
the same existed prior to any such casualty and with at least as good workmanship and quality as the
Improvements being repaired or replaced, all in compliance with the provisions of Article VI hereof but
with such alterations or modification as to restored Improvements as may be consistent with the further
terms and provisions hereof. Such work shall commence on or before one hundred eighty (180) days from
the event giving rise to such construction obligation and shall be completed thereafter with reasonable
diligence. If, after the date of substantial completion of the Sublessor Improvements and during the term
of this Sublease, the Sublessor Improvements or any other improvements constructed by Sublessor now or
hereafter situated on the Demised Premises during the term of this Sublease, are wholly or partially
destroyed or damaged by fire, or any other casualty whatsoever, Sublessee shall promptly repair, replace,
restore or reconstruct the same in substantially the form in which the same existed prior to any such casualty
and with at least as good workmanship and quality as the Improvements being repaired or replaced, all in
compliance with the provisions of Article VI hereof but with such alterations or modification as to restored
Improvements as may be consistent with the further terms and provisions hereof. Notwithstanding any
provision in this Sublease to the contrary, (a) after the substantial completion date of the Sublessor
Improvements, Sublessee shall be entitled to and shall receive (subject to subsection (2) below) all
insurance proceeds received by Sublessee and Sublessor in connection with damage and destruction of the
Sublessor Improvements and the Demised Premises by fire or any other casualty whatsoever; (b) at any
time Sublessee is required under this Sublease to insure and replace the Sublessor Improvements, Sublessee
shall be entitled to and shall receive (subject to subsection (2) below) all insurance proceeds received by
Sublessee and Sublessor in connection with damage and destruction of the Sublessor Improvements and
the Demised Premises by fire or any other casualty whatsoever; and (c) prior to the substantial completion
date of the Sublessor Improvements, Sublessee shall be entitled to receive (subject to subsection (2) below)
all insurance proceeds received by Sublessee in connection with damage and destruction of the Sublessee’s
Improvements by fire or any other casualty whatsoever and Sublessor shall be entitled to receive all
insurance proceeds received by Sublessor in connection with damage and destruction of the Sublessor’s
Improvements by fire or any other casualty whatsoever. Subject to confirmation of available insurance
proceeds, such work, if any, shall commence on or before one hundred eighty (180) days from the event
giving rise to such construction obligation and shall be completed thereafter with reasonable diligence by
Sublessee.
(2) Deposit of Funds for Restoration. So long as there exists a Leasehold Mortgage, all fire
and extended coverage insurance proceeds shall be deposited with the holder of such Leasehold Mortgage
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having the first lien priority. If there is no Leasehold Mortgage, such proceeds shall be deposited with a
national bank in Dallas, Texas selected by Sublessee (“Qualified Bank”). In any event such proceeds
shall be received, held and paid out by such Leasehold Mortgage, if any, or by such Qualified Bank, and
shall be disbursed for restoration for the casualty damage as follows unless modified by the Leasehold
Mortgage:
(A) Sublessee or Sublessor, as applicable based on the party being responsible for the
repairs and restoration and seeking disbursement of insurance proceeds, must first secure
Sublessor’s or Sublessee’s (as applicable), the Corps’, the City’s, and any Leasehold
Mortgagee’s reasonable approval of the plans and specifications for the proposed
restorative work if such plans and specifications for restoration deviate materially from the
plans and specifications for the Improvements which have been so damaged. The
insurance proceeds will be paid to Sublessee or Sublessor, as applicable, by the first lien
Leasehold Mortgagee, if any, or disbursed by such Qualified Bank, if any, after delivery of
evidence satisfactory to such Leasehold Mortgagee, if any, and to Sublessor and Sublessee,
as applicable, that (1) such repair, restoration or rebuilding has been completed and effected
in compliance with this Sublease as to quality, and (2) no mechanics’ or materialmen’s
liens have attached to the fee or leasehold estate; or at the option of Sublessee or Sublessor,
as applicable, such proceeds may be advanced by such Leasehold Mortgagee or disbursed
by such Qualified Bank in reasonable installments. Each such installment (except the final
installment) is to be advanced by such Leasehold Mortgagee, if any, or disbursed by such
Qualified Bank, if any, in an amount equal to the cost of construction of the work completed
(including Sublessee’s or Sublessor’s, as applicable, overhead directly related or
reasonably allocated thereto) since the last prior advance (or since commencement of work,
as to the first advance) according to a certificate (the “Architect’s Certificate”) by the
Sublessee’s or Sublessor’s architect, as applicable, in charge, less statutorily required
retainage in respect of mechanics’ and materialman’s liens, together with a reasonable
showing of bills for labor and material, and evidence satisfactory to any such Leasehold
Mortgagee that no lien affidavit has been filed in county for any labor-or material in
connection with such work. Sublessee or Sublessor, as applicable based on the party being
responsible for the repairs and restoration and seeking disbursement of insurance proceeds,
shall deliver a copy of the Architect’s Certificate and accompanying materials to the other
party (whether Sublessor or Sublessee) concurrently with the delivery of the Architect’s
Certificate and accompanying materials to the Leasehold Mortgagee or Qualified Bank, as
applicable. The final payment or disbursements, which shall be in an amount equal to the
balance of such proceeds, shall then be made upon architect’s proper certificate of
completion (the “Certificate of Completion”) and upon receipt of evidence required by
(a) (1) and (a) (2) above, but in no event shall such Leasehold Mortgagee, if any, or such
Qualified Bank, if any, be required to advance more than the balance of such insurance
proceeds remaining on deposit with such disbursing agent. Sublessee or Sublessor, as
applicable based on the party being responsible for the repairs and restoration and seeking
disbursement of insurance proceeds, shall deliver a copy of the Certificate of Completion
and accompanying materials to the other party (whether Sublessor or Sublessee)
concurrently with the delivery of the Certificate of Completion and accompanying
materials to the Leasehold Mortgagee or Qualified Bank, as applicable;
(B) Should the cost of said repairs, restoration or rebuilding be estimated by
Sublessee’s or Sublessor’s architect, as applicable, in charge to be in excess of said
insurance proceeds or should the actual cost determined after Sublessee or Sublessor, as
applicable, has commenced restoration be in excess of said proceeds, Sublessee or
Sublessor, as applicable will upon demand by any such Leasehold Mortgagee give
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satisfactory proof or assurances to such Leasehold Mortgagee that the funds required to
meet such deficiency are or will be available to Sublessee or Sublessor, as applicable, for
such purpose or will deposit the necessary funds to cover such deficiency with such
Leasehold Mortgagee;
(C) Any and all such insurance proceeds in excess of the cost of such repairs,
restoration or rebuilding may, if any Leasehold Mortgage so provides, be applied in
reduction of unpaid principal and other indebtedness due under such Leasehold Mortgage
in the order of priority of such Leasehold Mortgagees; provided, however, that no insurance
proceeds in excess of the cost of such repairs, restoration or rebuilding shall be applied to
reduce the amount of any Leasehold Mortgage unless the architect has delivered to
Sublessee or Sublessor, as applicable, a certificate to the effect that such repairs, restoration
or rebuilding have been completed substantially in accordance with plans and
specifications therefor and in such event and prior to substantial completion of the
Sublessor Improvements, only insurance proceeds received from Sublessor’s insurance
coverages may be applied to reduce the amount of any Leasehold Mortgage on Sublessor’s
interest and only insurance proceeds received from Sublessee’s insurance coverages may
be applied to reduce the amount of any Leasehold Mortgage on Sublessee’s interest. After
completion of the Sublessor Improvements, excess insurance proceeds may be applied to
reduce the amount of any Leasehold Mortgage on Sublessee’s interest. In the event that
there is no Leasehold Mortgage on Sublessee’s interest, or no Leasehold Mortgagee elects
to apply any such excess, the amount of excess shall be paid over to Sublessee.
(3) No Abatement. In the event of any such casualty, the rental and other payments herein
provided for shall not be abated, and the happening of any such casualty shall not cause a termination of
this Sublease except as herein provided.
Section 11.2. Condemnation.
Section 11.2.(1). Total Taking. Sublessor and Sublessee agree that if the whole of either the
Marina Facilities or the Demised Premises is taken (which term when used in this Section 11.2 shall include
any conveyance in avoidance or settlement of condemnation or eminent domain proceedings) by the United
States, the Corps, the State of Texas, the City, or any other government or power whatsoever, or by any
corporation under the right of eminent or should the whole of said Marina Facilities or Demised Premises
and improvements associated therewith are condemned by any court, city, state, county or governmental
authority or office, department or bureau of the city, county, state or United States, then this Sublease shall
terminate as of the date of taking of possession by the condemning authorities (or the later date on which
Sublessee receives its portion of the award) and the award will be distributed and payable to Sublessee.
Section 11.2.(2). Partial Taking. Sublessor and Sublessee agree that should the leasehold
estate be taken in part of either the Marina Facilities or Demised Premises by the United States, Corps, State
of Texas, the City, or any other government or power whatsoever, or by any corporation under the right of
eminent domain, or should a part of either of said Marina Facilities or Demised Premises be condemned by
any court, city, state, county or governmental authority or office, department or bureau of the city, county,
state or United States, then in such event this Sublease shall nevertheless continue in effect as to the
remainder of the Demised Premises unless in Sublessee’s commercially reasonable judgment so much of
the Demised Premises is so taken or condemned as to make it economically unsound to attempt to use the
remainder for the uses and purposes contemplated herein, in which latter event this Sublease shall terminate
upon notice of termination by the Sublessee to Sublessor, with such termination to be effective as of the
date of taking of possession by the condemning authority (or later date on which Sublessee receives its
portion of the award) in the same manner as if the whole of the Demised Premises had been thus taken or
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condemned; provided, however, that if a Leasehold Mortgage then encumbers the Demised Premises this
Sublease shall not terminate without the prior written consent of the Leasehold Mortgagee. In the event
of such taking or condemnation of a portion of the Demised Premises where this Sublease is not terminated
thereby under the provisions of the first sentence of this Paragraph, the Rental payable during the remainder
of the term after taking of possession by said condemning authority shall be reduced on a just and
proportionate basis having due regard to the square footage of the portion of the Demised Premises and the
percentage of the wet slips thus taken or condemned as compared to the remainder thereof and taking into
consideration the extent, if any, to which Sublessee’s use of the remainder of the Demised Premises shall
be been impaired or interfered with by reason of such partial taking or condemnation.
Section 11.2.(3). Award. In the event that a part of the Demised Premises and
Improvements be taken under the power of eminent domain, or by condemnation proceedings and this
Sublease is terminated by reason of such partial taking, and no work will have to be performed as a result
thereof, then the award will be distributed to Sublessee in accordance with Section 11.1. In the event that a
part of the Demised Premises and Improvements be taken under the power of eminent domain or by
condemnation proceedings and this Sublease is not terminated by reason of such partial taking, then the
condemnation award shall be paid to Sublessee to the extent the condemnation impairs the Sublessee
Improvements and to the Sublessor to the extent the condemnation impairs the Sublessor Improvements
(subject to Sublessee’s right to receive twenty-five percent (25%) of the Sublessor’s award as a
reimbursement for Sublessee’s contribution to the costs of Sublessor Improvements).
Section 11.2.(4). Rights of Leasehold Mortgagee. If any Leasehold Mortgagees
encumber the leasehold estate, the Leasehold Mortgagees shall, to the extent permitted by law, be made a
party to any condemnation proceeding, if any so desire.
Section 11.2.(5). Voluntary Dedication; Easement Grants. It is further understood,
however, that if during the term of this Sublease any portion of the Demised Premises (that is, with respect
to the leasehold interest therein) shall be voluntarily devoted to public use by Sublessee, it is expressly
agreed that there shall be no abatement of Annual Rental on account of said voluntary application to public
use, nor shall Sublessee thereby permit the public to acquire any right to or interest in any part of the
Demised Premises which will continue beyond the termination of this Sublease for any cause without the
Corps’, the City’s, and Sublessor’s prior written consent. Sublessor further covenants and agrees that it
will not undertake or consent to any change in the zoning applicable to the Demised Premises without
Sublessee’s prior written consent. Any dedication of any portion of the Demised Premises by plat or
easement grant previously approved in connection with the Sublessor Plans and Specifications and
Sublessee Plans and Specifications of the Improvements to be constructed on the Demised Premises,
utilities or other purposes provided above shall not result in any reduction or abatement of Annual Rental
under this Sublease.
ARTICLE XII.
ASSIGNMENT, SUBLETTING AND MORTGAGE
Section 12.1. Assignment. Sublessee may assign any of its rights or obligations under this
Sublease to an Affiliate. Except for Approved Subleases (defined below) of space within the Demised
Premises, Leasehold Mortgages, boat slip licenses or leases to third parties desiring to lease a wet slip on
the Demised Premises (“Slip Licenses”) , and subleases or assignments to an Affiliate (defined below)
(collectively Leasehold Mortgages, Slip Licenses, and subleases or assignments to an Affiliate shall
sometimes be referred to as “Permitted Transfers”), Sublessee shall not sell, assign or otherwise transfer
any portion of its leasehold estate, or undivided interests therein, to any party, other than an Affiliate of
Sublessee, without the prior written consent of Sublessor, the City, and the Corps. As used in this
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Sublease, “Affiliate” when used in reference to Sublessor or Sublessee shall refer to any person, firm,
corporation, partnership or other legal entity (for convenience herein called “person”) controlled by,
controlling or under common control with a party. Control as used in this definition means actual direction
or power to direct the affairs of the controlled person, and no person shall be deemed in control of another
simply by virtue of being a director, officer or holder of voting securities of any entity. A person shall be
presumed to control any partnership of which he or it is a general partner.
Section 12.2. Subleasing. Subleases of space within the Demised Premises that satisfy the
requirements of this Section 12.2 are “Approved Subleases.” Sublessee must deliver a copy of any fully
executed Approved Subleases to Sublessor, the City and the Corps.
(1) Approval. Except for Permitted Transfers, Sublessee shall not sublet all or any portion
of the Demised Premises for occupancy by any sub-sublessee without the prior written consent of
Sublessor, the City and the Corps.
(2) Sublease Terms. In addition to the other required provisions contained in this Sublease,
Sublessee’s sublease agreements shall include provisions that provide:
(A) that the sublease is subject to every provision of this Sublease, the City Sublease,
and the Corps Lease;
(B) that the sublease shall not be for a term extending beyond the term of this Sublease;
(C) that the sub-sublessee is responsible for complying with all Governmental
Regulations, and that sub-sublessee’s failure to cure after receiving notice of non-
compliance will result in Sublessee’s right to terminate the sublease;
(D) that the sub-sublessee is responsible for obtaining insurance identical to that
required of Sublessee as described in Section 9.1.
(3) Sub-Sublessee Attornment. If this Sublease terminates for any reason, including
Sublessee’s default, Sublessor shall accept the attornment by sub-sublessees in good standing and paying
fair market rentals under Approved Subleases. In no circumstance is Sublessor required to accept a
sublease that (X) reduces rental payable to Sublessor or calls for the granting of concessions in rent at any
time, (Y) allows the prepayment of rent beyond the current month for which rent is due and payable (except
the prepayment of rental for the last month of the term of a sublease made to an actual space occupant for
the space to be occupied by him), or (Z) imposes on the Sublessor any obligation to make alterations to the
Demised Premises under the sublease or to reimburse sub-sublessee for alterations made by the sub-
sublessee.
Section 12.3. Continuing Obligations. Notwithstanding any assignment or subletting,
Sublessee shall at all times remain fully responsible and liable for the payment of the rent herein specified
and for compliance with all of its other obligations under this Sublease (even if future assignments and
sublettings occur subsequent to the assignment or subletting by Sublessee, and regardless of whether or not
Sublessor’s approval has been obtained for such future assignments and sublettings). Sublessor shall be
permitted to enforce the provisions of this Sublease against the undersigned Sublessee and/or any assignee
without demand upon or proceeding in any way against any other person. Sublessee shall reimburse
Sublessor for Sublessor’s reasonable expenses incurred by Sublessor in connection with any request by
Sublessee for assignment or subletting.
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Section 12.4. Mortgage of Leasehold.
(a) Sublessee’s Rights. Sublessee may mortgage its leasehold estate, but not
Sublessor’s leasehold estate, the City’s leasehold estate, or the Corps fee estate, in order to secure
a mortgage loan to obtain funds to construct the Sublessee Improvements, to fund the Infrastructure
Contribution, for permanent loan funds used to retire interim construction financing, to secure
financings made to the direct or indirect owners of Sublessee, or for other financing or refinancing
directly benefiting the Demised Premises so long as the conditions precedent set forth in Section
12.4(e) are satisfied.
(b) Leasehold Mortgagee’s Obligations. If Sublessee permissibly mortgages or
encumbers its leasehold estate, the Leasehold Mortgagee shall in no event be required to perform
the obligations of Sublessee under this Sublease unless and until the Leasehold Mortgagee becomes
the owner of the leasehold estate pursuant to foreclosure, assignment in lieu of foreclosure or
otherwise; thereafter, the Leasehold Mortgagee shall remain subject to these obligations only so
long as the Leasehold Mortgagee remains the owner of the leasehold estate, and in no event shall
the obligations to be performed hereunder be more expansive for the Leasehold Mortgagee than for
Sublessee.
(c) Leasehold Mortgagee’s Rights Not Greater than Sublessee’s. With the
exception of the rights granted to Leasehold Mortgagees pursuant to the express provisions of this
Section 12.4, the execution and delivery of a mortgage, deed of trust or Leasehold Mortgage shall
not give nor shall be deemed to give a mortgagee, a beneficiary under a deed of trust or a Leasehold
Mortgagee any greater rights against Sublessor than those granted to Sublessee hereunder.
(d) Sublessee’s Obligations. Notwithstanding the forgoing, it is specifically
understood and agreed that no mortgaging by Sublessee and/or any actions taken pursuant to the
terms of the Leasehold Mortgage shall ever eliminate or reduce Sublessee’s obligation to pay the
Annual Rental due hereunder and otherwise fully perform under this Sublease. Sublessee shall
give prompt notice to Sublessor of the terms of any Leasehold Mortgage. Sublessee agrees to duly
and timely perform all of its obligations under any such Leasehold Mortgage.
(e) Conditions Precedent. Sublessee agrees that, as a condition precedent to its right
to execute any Leasehold Mortgage, it shall:
(1) obtain the City’s prior written consent to any Leasehold Mortgage as
required in Section 9.01 of the City Sublease;
(2) furnish to Sublessor its loan documents entered into with the Leasehold
Mortgagee; and
(3) cause its Leasehold Mortgagee to agree to the following:
(i) deliver a copy of any notice given by the Leasehold
Mortgagee to Sublessor pursuant to the Leasehold Mortgage at the time
that it is given to Sublessee (provided that if Leasehold Mortgagee refuses
to agree to this, Sublessee must deliver to Sublessor a copy of any notices
received from Leasehold Mortgagee promptly upon Sublessee’s receipt);
and
(ii) Leasehold Mortgagee will agree that there will be an
ongoing covenant in the event the Leasehold Mortgagee forecloses on the
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Leasehold Mortgage that the Demised Premises shall continue to be
operated in a first-class manner and Sublessor shall have the unrestricted
right to approve the replacement operator of the Demised Premises and the
Marina Facilities located thereon.
(f) Sublessor’s Obligations. Sublessor hereby agrees to the following for the
benefit of any Leasehold Mortgagee:
(1) Leasehold Mortgagee may realize on the security afforded by the
leasehold estate by exercising foreclosure proceedings or other remedies afforded at law or
in equity and acquire and succeed to the interest of Sublessee by virtue of the exercise of
any such remedies;
(2) If the Leasehold Mortgage is foreclosed upon by the Leasehold
Mortgagee, and the Demised Premises is acquired by such Leasehold Mortgagee or an
independent third party as the result of a foreclosure sale or conveyance in lieu of
foreclosure under said Leasehold Mortgage, Leasehold Mortgagee shall be permitted to
exercise any rights of Sublessee under the Sublease;
(3) All notices required to be given Sublessee pursuant to the terms of the
Sublease shall be given simultaneously to the Leasehold Mortgagee, so long as Sublessor
has been given written notice of its address, and no notice shall be effective against
Leasehold Mortgagee (and no grace period or cure period shall commence with respect to
Leasehold Mortgagee) until such notice has been given to Leasehold Mortgagee;
(4) All grace periods or rights to cure or remedy defaults held by Sublessee or
to which Sublessee is entitled by reason of any notice hereunder shall likewise be held by
the Leasehold Mortgagee (provided that, so long as Leasehold Mortgagee has commenced
to cure the default and is proceeding with due diligence to cure the default, Leasehold
Mortgagee shall receive an additional thirty (30) days to cure any such defaults, and if such
default cannot reasonably be cured within a thirty (30) day period and Leasehold
Mortgagee is diligently proceeding to cure the default, Leasehold Mortgagee shall have
such additional time period to cure the default as may be reasonably required not to exceed
one hundred twenty (120) days);
(5) If the Demised Premises is acquired by such Leasehold Mortgagee or an
independent third party as the result of a foreclosure sale or conveyance in lieu of
foreclosure under said Leasehold Mortgage, Sublessor agrees not to terminate the Sublease
in connection with such foreclosure sale or conveyance in lieu thereof, provided that (A)
Leasehold Mortgagee or such third party prosecutes and completes such foreclosure or
other appropriate proceedings to acquire possession of and control over Sublessee’s
leasehold estate in the Sublease with reasonable diligence, (B) during the pendency of any
such foreclosure or other proceedings with respect to Sublessee’s interest in the Sublease,
Leasehold Mortgagee cures any defaults of Sublessee under this Sublease susceptible of
being cured by Leasehold Mortgagee without possession of the Demised Premises by the
Leasehold Mortgagee, and (C) upon Leasehold Mortgagee’s acquiring possession of the
Demised Premises, it expressly assumes Sublessee liabilities and obligations and privileges
under the Sublease and promptly commences to cure any default of Sublessee susceptible
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of being cured by Leasehold Mortgagee after Leasehold Mortgagee obtains possession of
the Demised Premises;
(6) No substantive modification, amendment, waiver, release, termination or
other substantive change in the terms of the Sublease will be effective as to any Leasehold
Mortgagee without the prior written consent of the Leasehold Mortgagee;
(7) If the Sublease, without the consent of Leasehold Mortgagee, is terminated
for any reason (whether by reason of default of Sublessor or Sublessee, rejection of the
Sublease in any bankruptcy case, voluntary surrender and acceptance, or otherwise) prior
to its stated term, as the same may be extended, then Sublessor shall provide written notice
of such termination to Leasehold Mortgagee and, upon written request from Leasehold
Mortgagee made within thirty (30) days after such notification, enter into a new lease of
the Demised Premises with Leasehold Mortgagee subject to any approval rights held by
the City under the City Sublease or the Corps under the Corps Lease. The new lease shall
be effective as of the date of termination of the Sublease and be on the same terms and
conditions as the Sublease (including, without limitation, any rights or options to extend
the term of the Sublease) and shall not materially expand or reduce the rights or obligations
of the landlord or tenant thereunder. Leasehold Mortgagee and its nominee shall not be
liable for or otherwise be required to cure any defaults which are personal to Sublessee
(such as, for example, any default arising by virtue of any bankruptcy, insolvency or
dissolution of Sublessee). Sublessor’s obligation to enter into the new lease shall be
conditioned upon the following: (A) Leasehold Mortgagee shall have cured all defaults
under the Sublease that can be cured by the payment of money or performance of an action
and paid to Sublessor all Rent and other sums that would have been due and payable by
Sublessee under this Sublease but for such termination; and (B) Leasehold Mortgagee shall
reimburse Sublessor for all reasonable costs and expenses incurred in entering into the new
lease. To the extent practicable, such new lease shall have the same priority as this Sublease
as of the Effective Date; provided, however, that Sublessor shall not be deemed to have
represented or covenanted that such new lease shall be superior to encumbrances suffered
or created by Sublessee, or claims of Sublessee, its other creditors or a judicially appointed
receiver or trustee for Sublessee;
(8) In any case commenced by or against Sublessor under Title 11 of the
United States Code (the “Bankruptcy Code”), if Sublessor elects to reject the Sublease
pursuant to the provisions of the Bankruptcy Code, the rejection will not terminate the
Sublease but will be treated only as a breach of the Sublease by the Sublessor. Sublessor
further agrees that in such a bankruptcy case Sublessee shall be deemed in possession of
the Demised Premises for purposes of Section 365(h) of the Bankruptcy Code, whether
Sublessee has retained actual occupancy and use, or has by sublease, assignment or license
permitted third parties to occupy and use portions of the Demised Premises; and as a result,
upon a rejection of the Sublease by Sublessor the Sublessee shall have the right to elect to
remain in possession of the Demised Premises under Section 365(h). Sublessor
acknowledges that Leasehold Mortgagee shall have a lien on any rights and interests
acquired or retained by Sublessee as a result of Sublessor’s rejection of the Sublease.
Sublessor acknowledges that Leasehold Mortgagee has in such bankruptcy case a power
of attorney or other right to act for and on behalf of Sublessee in relation to any proposed
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rejection or assumption of the Sublease (but Leasehold Mortgagee shall not have any
obligations under the Sublease unless Leasehold Mortgagee expressly assumes the same);
(9) If more than one Leasehold Mortgagee has exercised any of the rights
afforded by this Section 12.4 hereof, only that Leasehold Mortgagee, to the exclusion of
all other Leasehold Mortgagees, whose Leasehold Mortgage is most senior in lien shall be
recognized by Sublessor as having exercised such right, unless such Leasehold Mortgagee
has designated a Leasehold Mortgagee whose Leasehold Mortgage is junior in lien to
exercise such right. If the parties shall not agree on which Leasehold Mortgage is prior in
lien, such dispute shall be determined by a title insurance company chosen by Sublessor,
and such determination shall conclusively bind the parties hereto and all Leasehold
Mortgagees; and
(10) In addition, at Sublessee’s option, Sublessor will consent to the following
for the benefit of any Leasehold Mortgagee:
(i) an assignment of Sublessee’s share of the net proceeds
from any award or other compensation resulting from a total or partial
taking as set forth in Section 11.2 of this Sublease,
(ii) a collateral assignment of this Sublease, and
(iii) that, effective on a default in any Leasehold Mortgage, the
Leasehold Mortgagee may (A) foreclose the Leasehold Mortgage pursuant
to a power of sale by judicial proceedings or other lawful means and sell
the leasehold estate to the purchaser at the foreclosure sale, (B) appoint a
receiver, irrespective of whether any Leasehold Mortgagee accelerates the
maturity of all indebtedness secured by the Leasehold Mortgage, (C) enter
and take possession of the Demised Premises, manage and operate the
same, collect the subrentals, issues and profits therefrom and cure any
default under the Leasehold Mortgage or any default by Sublessee under
this Sublease, and (D) assign Sublessee’s right, title and interest in and to
the premiums for or dividends on any insurance required by the terms of
this Sublease, as well as in all refunds or rebates of taxes or assessments
on or other charges against the Demised Premises, whether paid or to be
paid, provided that none of the foregoing shall be effective with respect to
Sublessor until notice of the existence of the Leasehold Mortgage is
delivered to Sublessor.
Section 12.5 Non-Disturbance. In the event that Sublessor does not obtain, at or prior to the
Commencement Date, the release of the Demised Premises from any leasehold mortgage granted by
Sublessor which encumbers the Demised Premises, then Sublessor shall obtain non-disturbance agreements
with all lenders with a leasehold mortgage granted by Sublessor which encumbers the Demised Premises,
Sublessee, and Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the parties.
The encumbrance of the Demised Premises by any future leasehold mortgage granted by Sublessor shall be
conditioned upon Sublessor obtaining non-disturbance agreements with any such future lenders, Sublessee,
and Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the parties, with such
commercially reasonable modifications as may be requested by such future lenders. In addition to the
foregoing, Sublessor shall use commercially reasonable efforts to obtain non-disturbance agreements in a
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form reasonably acceptable to Sublessee from the Corps and the City prior to the Commencement Date of
this Sublease.
Section 12.6 Sublessor Transfers and Mortgages.
(1) Sublessor may freely assign, transfer, sublet, hypothecate, pledge or mortgage
Sublessor’s interest under this Sublease or in the Demised Premises, subject to the terms and provisions of
this Sublease, including, without limitation, Section 12.6(3), without Sublessee’s prior written consent.
(2) Sublessor will use commercially reasonable efforts to cause any lienholder
(“Sublessor’s Lender”) to whom Sublessor grants a deed of trust, mortgage, pledge, or lien upon
Sublessor’s interest in the Demised Premises or this Sublease (“Sublessor’s Mortgage”) to enter into an
agreement among Sublessor, Sublessor’s Lender, Sublessee and Sublessee’s Mortgagee that provides: (A)
a copy of all notices to Sublessor of any default or defaults of Sublessor under the applicable loan documents
or in connection with such loan by Sublessor’s Lender, including notice of acceleration of the maturity of
the indebtedness, will be given to Sublessee and Sublessee’s Mortgagee, (B) Sublessor’s Lender will accept
a cure by Sublessee or Sublessee’s Mortgagee of any default under such loan documents by Sublessor, but
that Sublessee and Sublessee’s Mortgagee will not be required to cure any such default, (C) all payments
so made and all things so done or performed by Sublessee or Sublessee’s Mortgagee will be effective to
prevent an acceleration of the maturity of the indebtedness, the foreclosure of any liens securing payment
thereof or the exercise of any other remedies of Sublessor’s Lender upon default by Sublessor thereunder
as the same would have been if paid, done or performed by Sublessor instead of by Sublessee or Sublessee’s
Mortgagee, and (D) a right, but not an obligation, for Sublessee or Sublessee’s Mortgagee to purchase the
Sublessor’s Mortgage upon acceleration of the Sublessor Mortgage indebtedness after a default by
Sublessor that remains uncured after any applicable cure periods. Sublessee or Sublessee’s Mortgagee
will not be or become liable to any Sublessor’s Lender as a result of the right and option to cure any such
default or defaults by Sublessor.
(3) It shall be a condition precedent to Sublessor hypothecating, pledging or
mortgaging Sublessor’s interest under this Sublease or in the Demised Premises that Sublessor enter into a
subordination, non-disturbance, and attornment agreement with Sublessor’s Lender, Sublessee and
Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the parties.
ARTICLE XIII.
MUTUAL INDEMNIFICATION
Section 13.1. Sublessee. From and after the Effective Date, Sublessee agrees to protect, defend
(with counsel reasonably acceptable to Sublessor), indemnify and hold harmless Sublessor from and against
any and all loss, cost, damage and liability and expense (including court costs and reasonable attorneys’
fees) arising from (i) the failure by Sublessee or any of its employees or sub-sublessees to perform
Sublessee’s duties and obligations under this Sublease in accordance with the terms hereof, (ii) until the
substantial completion date of the Sublessor Improvements, the negligence or misconduct of Sublessee,
Sublessee’s employees, sub-sublessees, servants, or invitees entering the Demised Premises under express
or implied invitation of Sublessee, (iii) the construction, installation, repair or maintenance of the Sublessee
Improvements and, after substantial completion, the repair and maintenance of Sublessor Improvements
conducted by Sublessee (excluding the construction, installation, repair and maintenance of Sublessor
Improvements which was and remains the responsibility of Sublessor), or (iv) the operation of Sublessee’s
business in the Demised Premises, and any other activities on or about the Demised Premises, including
without limitation, any claims, liabilities or damages relating to products liability.
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Section 13.2. Sublessor. From and after the Effective Date, Sublessor agrees to protect, defend
(with counsel reasonably acceptable to Sublessee), indemnify and hold harmless Sublessee from and against
any and all loss, cost, damage and liability and expense (including court costs and reasonable attorneys’
fees) arising from (i) the failure by Sublessor or any of its employees or contractor to perform Sublessor’s
duties and obligations under this Sublease in accordance with the terms hereof, (ii) the negligence or
misconduct of Sublessor, Sublessor’s employees, contractors, or invitees entering the Demised Premises
under express or implied invitation of Sublessor or Sublessor’s license pursuant to Section 10.4, or (iii) any
deficiencies or defects in the construction or installation of the Sublessor Improvements from the substantial
completion date of the Sublessor Improvements until the expiration date of any warranties from contractors
under the construction contracts for the Sublessor Improvements.
Section 13.3. No Liability to Third Parties and Sub-Sublessees. In connection with its
management, operation, promotion and subleasing of the, Demised Premises, including, but not limited to
Sublessee’s business operations, Sublessee shall insert into each and every contract or sublease it enters
into a clause exculpating Sublessor from personal liability under the contract or lease and a clause pursuant
to which the third party/sub-sublessee agrees to indemnify and hold harmless Sublessor for the matters set
forth in Section 13.1.
ARTICLE XIV.
DEFAULT AND REMEDIES
Section 14.1. Default by Sublessee. Each of the following events is a “Sublessee Event of
Default” by Sublessee under this Sublease:
(1) Failure by Sublessee to pay any installment of rental or to pay or cause to be paid taxes (to
the extent Sublessee is obligated to pay same or cause same to be paid), utilities, insurance premiums or
other liquidated sums of money herein stipulated in this Sublease to be paid by Sublessee if such failure
shall continue for a period of five (5) business days after written notice (“Sublessee’s First Monetary
Notice”) thereof has been delivered to Sublessee (with a copy of said notice to any Leasehold Mortgagee
or trustee as provided by Article XII hereof).
(2) Failure by Sublessee to perform or observe any of the terms, covenants, conditions,
agreements and provisions of this Sublease (other than the payment of rent, taxes, utilities, insurance
premiums or other liquidated sums of money and other than the obligations to commence construction by
the date provided in Section 6.1) stipulated in this Sublease to be observed and performed by Sublessee if
such failure shall continue for a period of thirty (30) days after notice (“Sublessee’s First Non-Monetary
Notice”) thereof has been delivered to Sublessee (with a copy of said notice to any Leasehold Mortgagee
or trustee as provided in Article XII hereof); provided, however, that if any such failure (other than a failure
involving payment of liquidated sums of money) cannot reasonably be cured within such thirty (30) day
period, then Sublessor shall not have the right to exercise Sublessor’s remedies pursuant to Subparagraph
(1) or (2) of Section 14.2 for so long as Sublessee proceeds in good faith and with due diligence to remedy
and correct any such failure, provided that Sublessee has commenced to cure such failure after the effective
date of such notice within such thirty (30) day period.
Section 14.2. Sublessor Remedies for Sublessee Default. If a Sublessee Event of Default occurs
hereunder, Sublessor may, at any time thereafter (i.e. after the period following the First Monetary Notice
or First Non-Monetary Notice provided for in Section 14.1) during the continuance of such Sublessee Event
of Default after giving a second ten (10) days’ written notice (“Second Notice”) to Sublessee (with a copy
of said Second Notice to any Leasehold Mortgagee or trustee as provided in Article XII hereof), do one or
more of the following as Sublessor’s remedies for such Sublessee Event of Default:
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(1) Subject to the provisions of Article XII hereof with respect to the rights of any Leasehold
Mortgagee, terminate this Sublease by giving Sublessee written notice of termination (with a copy of
said notice to any Leasehold Mortgagee or trustee as provided in Article XII hereof), in which event
this Sublease and the leasehold estate created hereby and all interest of Sublessee and all parties
claiming by, through or under Sublessee shall automatically terminate upon the effective date of such
termination notice with the same force and effect and to the same extent as if the effective date of such
notice were the day originally fixed in Article I hereof for the expiration of the term of this Sublease
(provided, however, Sublessor may elect not to terminate the Slip Licenses), and Sublessor, its agents
or representatives, shall have the right, without further demand or notice, to reenter and take possession
of the Demised Premises (including all Improvements comprising part thereof) and remove all persons
and property therefrom with or without process of law, without being deemed guilty of any manner of
trespass and without prejudice to any remedies of Sublessor for past due rent or other sums dues under
the provisions hereof.
(2) Subject to the provisions of Article XII hereof with respect to the rights of any Leasehold
Mortgagee, terminate Sublessee’s right to possession of the Demised Premises and enjoyment of the
rents, issues and profits therefrom, without terminating this Sublease or the leasehold estate created
hereby, reenter and take possession of the Demised Premises (including all Sublessee Improvements
and other Improvements comprising part thereof) and remove all persons and property therefrom, with
or without process of law, without being deemed guilty of any manner of trespass and without
prejudice to any remedies for any breaches of covenants (including the payment of rent), then existing
or thereafter occurring, and lease, manage and operate the Demised Premises and collect the rents,
issues and profits therefrom, all for the account of Sublessee, and credit to the satisfaction of
Sublessee’s obligations hereunder the net rental this received (after deducting therefrom all reasonable
costs and expenses of repossessing, leasing, managing and operating the Demised Premises). If the
net rental so received by Sublessor exceeds the amounts necessary to satisfy all of Sublessee’s
obligations under this Sublease (including reasonable reserves for operations and replacements),
Sublessor shall be entitled to such excess. In the event Sublessor retakes possession of the Demised
Premises under the foregoing provisions hereof, Sublessor shall not be liable for any damages or
injuries arising from its management and operation of the Demised Premises unless caused by the
negligence or misconduct of Sublessor, its agents or employees.
Notwithstanding the foregoing, in no event will Sublessor be required to deliver a Second Notice more than
one (1) time during a twelve (12) month period. If a second failure by Sublessee occurs during a twelve
(12) month period, Sublessor will only be required to deliver the first notice (whether a First Monetary
Notice or a First Non-Monetary Notice) and may then pursue its remedies set forth in Section 14.2 without
delivering a Second Notice.
The liability of Sublessee for the payment of rental and any other sums hereunder shall be
expressly subject to the further limitations and provisions of this Article XIV and Section 15.17 hereunder.
Section 14.3. Lien for Rent. In consideration of the mutual benefits arising under this
Sublease, Sublessee hereby grants to Sublessor a lien and security interest in all property of Sublessee
(including, but not limited to, all fixtures, machinery, equipment, furnishings, and other articles of personal
property now or hereafter placed in or on the Demised Premises by Sublessee, together with the proceeds
from the disposition of those items) (the “Collateral”), now or hereafter placed in or upon the Demised
Premises, as security for payment of all rent and other sums agreed to be paid by Sublessee herein. The
provisions of this Section 14.3 constitute a security agreement under the Texas Uniform Commercial Code,
and Sublessor has and may enforce a security interest in the Collateral. The Collateral shall not be removed
without the consent of Sublessor until all arrearages in rent and other sums of money then due to Sublessor
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hereunder have been paid and discharged. On or before the Commencement Date, Sublessee shall execute,
as Debtor, two or more Financing Statements, to perfect this security interest pursuant to the Texas Uniform
Commercial Code. Sublessor, as Secured Party, has all of the rights and remedies afforded a secured party
under the Texas Uniform Commercial Code in addition to and cumulative of the liens and rights provided
by law or by the other terms and provisions of this Sublease.
Section 14.4. Sublessor’s Remedies Cumulative. Pursuit of any one or more of the foregoing
remedies by Sublessor shall not preclude the simultaneous or subsequent pursuit of any other remedy
provided herein or any other remedy provided by law or in equity (including, but not limited to, the right
to seek actual damages or the right to seek specific performance), nor shall the pursuit of any one or more
remedies constitute a forfeiture or waiver of any rent or other amount payable by Sublessee hereunder or
of any damages accruing to or suffered by Sublessor by reason of any Sublessee Event of Default. NOT
WITHSTANDING ANY PROVISION IN THIS SUBLEASE TO THE CONTRARY, IN NO EVENT
SHALL SUBLESSEE BE LIABLE OR RESPONSIBLE FOR ANY CONSEQUENTIAL,
SPECULATIVE, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES UNLESS AND TO THE
EXTENT SUCH DAMAGES ARE PAYABLE UNDER THE CORPS LEASE OR CITY SUBLEASE
FOR SUCH DEFAULT.
Section 14.5 Default by Sublessor. Each of the following events is a “Sublessor Event of
Default” by Sublessor under this Sublease:
(1) Failure by Sublessor to pay or cause to be paid any monetary obligations due to Sublessee or any
other third party under this Sublease, taxes (to the extent Sublessor is obligated to pay same or
cause same to be paid), utilities, insurance premiums or other liquidated sums of money herein
stipulated in this Sublease to be paid by Sublessor if such failure shall continue for a period of five
(5) business days after written notice (“Sublessor’s First Monetary Notice”) thereof has been
delivered to Sublessor (with a copy of said notice to any Sublessor’s Lender or trustee as provided
in Section 12.5 hereof).
(2) Failure by Sublessor to perform or observe any of the terms, covenants, conditions, agreements and
provisions of this Sublease (other than the payment of monetary obligations, taxes, utilities,
insurance premiums or other liquidated sums of money and other than the obligations to commence
construction by the date provided in Section 6.1) stipulated in this Sublease to be observed and
performed by Sublessor if such failure shall continue for a period of thirty (30) days after notice
(“Sublessor’s First Non-Monetary Notice”) thereof has been delivered to Sublessor; provided,
however, that if any such failure (other than a failure involving payment of liquidated sums of
money) cannot reasonably be cured within such thirty (30) day period, then Sublessee shall not
have the right to exercise Sublessee’s remedies pursuant to subsection (1) or (2) of Section 14.6 for
so long as Sublessor proceeds in good faith and with due diligence to remedy and correct any such
failure, provided that Sublessor has commenced to cure such failure after the effective date of such
notice within such thirty (30) day period.
(3) Failure by Sublessor to perform or observe any of the terms, covenants, conditions, agreements and
provisions of the Corps Lease or the City Sublease (including the payment of monetary obligations,
taxes, utilities, insurance premiums or other liquidated sums of money) stipulated to be observed
and performed by Sublessor, subject to the applicable notice and cure periods, if any, set forth
therein.
Section 14.6 Sublessee Remedies for Sublessor Default. If a Sublessor Event of Default occurs
hereunder, except as expressly limited elsewhere in this Sublease, Sublessee may, at any time thereafter
(i.e. after the period following Sublessor’s First Monetary Notice or Sublessor First Non-Monetary Notice
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provided for in Section 14.5) during the continuance of such Sublessor Event of Default after giving a
Second Notice to Sublessor, do one or more of the following as Sublessee’s remedies as Sublessee’s sole
remedies for such Sublessor Event of Default:
(1) Restrain or enjoin any breach or threatened breach of any covenant or obligation of Sublessor
contained within this Sublease without the necessity of proving the inadequacy of any legal
remedy or irreparable harm and without bond;
(2) Pursue an action for actual damages;
(3) Seek specific performance; or
(4) Perform Sublessor’s obligations whatever they may be, including but not limited to constructing
and completing Sublessor Improvements, and offset any and all costs and expenses (including an
Administrative Fee (as defined below), attorney and consultant fees, and court costs) incurred by
Sublessee (“Sublessee’s Costs”) against installments of Rental plus any and all other amounts
next coming due by Sublessee under this Sublease. In the event Sublessee performs Sublessor’s
obligations, including but not limited to constructing and completing Sublessor Improvements
under this subsection (4), Sublessee will, in its discretion, be entitled to receive an administrative
fee from Sublessor in an amount equal to four percent (4%) of Sublessee’s Costs (“Administrative
Fee”). Such Administrative Fee shall, in Sublessee’s discretion, be payable immediately to
Sublessee on demand or offset against installments of Rental or other amounts next coming due
by Sublessee under this Sublease or both.
Notwithstanding the foregoing, in no event will Sublessee be required to deliver a Second Notice more than
one (1) time during a twelve (12) month period. If a second failure by Sublessor occurs during a twelve
(12) month period, Sublessee will only be required to deliver the first notice (whether a Sublessor First
Monetary Notice or a Sublessor First Non-Monetary Notice) and may then pursue its remedies set forth in
this Section 14.6 without delivering a Second Notice. IN NO EVENT SHALL SUBLESSOR BE LIABLE
OR RESPONSIBLE FOR ANY CONSEQUENTIAL, SPECULATIVE, INCIDENTAL, SPECIAL OR
PUNITIVE DAMAGES UNLESS AND TO THE EXTENT SUCH DAMAGES ARE PAYABLE UNDER
THE CORPS LEASE OR CITY SUBLEASE FOR SUCH DEFAULT.
Section 14.7. Sublessee’s Remedies Cumulative. Pursuit of any one or more of the foregoing
remedies by Sublessee shall not preclude the simultaneous or subsequent pursuit of any other remedy
provided herein), nor shall the pursuit of any one or more remedies set forth in this Lease constitute a
forfeiture or waiver of any amount payable by Sublessor hereunder or of any damages accruing to or
suffered by Sublessee by reason of any Sublessor Event of Default.
ARTICLE XV.
MISCELLANEOUS
Section 15.1. Rent on Net Return Basis. It is intended that the rent provided for in this
Sublease shall be a net return to Sublessor as provided herein, free of any expenses or charges with respect
to the Demised Premises, including, without limitation, maintenance, repairs, replacement, taxes and
assessments, and this Sublease shall be construed in accordance with and to effectuate this intention.
Section 15.2. Holding Over. If Sublessee, or any of Sublessee’s successors in interest, fails to
surrender the Demised Premises, or any part thereof, on the expiration of the term of this Sublease (whether
by lapse of time or otherwise), the holding over shall constitute a tenancy at-will, terminable at any time by
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either Sublessor or Sublessee after thirty (30) days’ prior written notice to the other, at a monthly rental
equal to 150% of the rent paid for the month preceding the expiration of the term of this Sublease. In the
event of any unauthorized holding over, Sublessee agrees to indemnify Sublessor and hold Sublessor
harmless against any cost, liability or loss incurred by Sublessor as a result of any such holding over by
Sublessee.
Section 15.3. Waiver of Default. No waiver by the parties hereto of any default or breach of
any term, condition or covenant of this Sublease shall be deemed to be a waiver of any subsequent default
or breach of the same or any other term, condition or covenant contained herein.
Section 15.4. Attorneys’ Fees. In the event of any litigation between the parties relating to this
Sublease, the prevailing party shall be entitled to recover its reasonable attorneys’ fees, expenses and costs
and court costs as part of any judgment, award or settlement. The right to attorneys’ fees shall survive the
expiration or earlier termination of this Sublease. For purposes of this Section 15.4, a party will be
considered to be the prevailing party if: (i) such party initiated the litigation and, as determined by the court
or arbitrator, substantially obtained the relief which it sought (whether by judgment, voluntary agreement
or action of the other party, trial or alternative dispute resolution process); (ii) such party did not initiate the
litigation and either (A) received a judgment in its favor, or (B) did not receive judgment in its favor, but
the party receiving the judgment did not substantially obtain the relief which it sought, as determined by
the court or arbitrator; or (iii) the other party to the litigation withdrew its claim or action without having
substantially received the relief which it was seeking as determined by the court or arbitrator.
Section 15.5. Estoppel Certificates. Both parties hereto agree that from time to time, on
twenty (20) days’ prior written request, the non-requesting party will deliver to the requesting party a
statement in writing certifying as of the date of such statement:
(1) if the facts permit, that this Sublease is unmodified and in full force and effect (or if there
have been modifications, that this Sublease as modified is in full force and effect and stating the
modifications);
(2) the dates to which rent and other charges have been paid; and
(3) to the non-requesting party’s knowledge that the requesting party is not in default under
any monetary obligation or other material term or provision of this Sublease, and if in default the nature
thereof in detail in accordance with an exhibit attached thereto.
(4) any other information reasonably requested by the requesting party or its mortgagee.
Section 15.6. No Partnership. It is understood and agreed that in leasing and operating the
Demised Premises, Sublessee is acting independently and is not acting as agent, partner, joint venturer or
employee of Sublessor.
Section 15.7. Survival. All of the terms, provisions, conditions, agreements and covenants
contained in this Sublease shall survive the expiration or termination of this Sublease with respect to all
rights and remedies that have accrued prior to or that accrue on the expiration or termination of this
Sublease.
Section 15.8. Exhibits. All exhibits, attachments, annexed instruments and addenda-referred
to herein shall be incorporated in this Sublease and considered a part of this Sublease for all purposes. The
parties acknowledge that the Exhibits may not be complete and final as of the Effective Date of this
Sublease. To the extent an Exhibit is not complete or final, then on or before the earlier of: (i) the date
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Sublessor commences construction of the Sublessor Improvements; or (ii) the date Sublessee commences
construction of the Sublessee Improvements, Sublessor and Sublessee will attach the final version of each
and every Exhibit mutually agreed to in writing by Sublessor and Sublessee and to the extent required,
accepted and approved by the City and the Corps. Additionally, if and to the extent the City requires a
change by Sublessor to an Exhibit, then Sublessee’s consent is not required for such change as long as such
change does not prevent the use of the Demised Premises as a marina. Sublessor shall deliver a copy of
any such amended or substituted Exhibit to Sublessee within fifteen (15) Business Days of the change,
substitution or amendment.
Section 15.9. Use of Language. Words of any gender used herein shall be held and construed
to include any other gender, and words in the singular shall be held to include the plural, unless the context
otherwise requires.
Section 15.10. Captions. The captions or headings of paragraphs in this Sublease are inserted for
convenience only, and shall not be considered in construing the provisions hereof if any question of intent
should arise.
Section 15.11. Successors. The terms, conditions and covenants contained in this Sublease shall
apply to, inure to the benefit of, and be binding upon the parties hereto and their respective successors in
interest, and successor trustees, heirs, executors, administrators and legal representatives. All rights,
powers, privileges, immunities and duties of either party under this Sublease, including, but not limited to,
any notices required or permitted to be delivered by either party hereunder, may, at such party’s option, be
exercised or performed by such party’s agent or attorney.
Section 15.12. Severability. If any provision herein is held to be invalid or unenforceable, the
validity and enforceability of the remaining provisions of this Sublease shall not be affected thereby.
Section 15.13. Notices. All notices which are required or permitted hereunder must be in writing
and shall be deemed to have been given, delivered or made, as the case may be (notwithstanding lack of
actual receipt by the addressee): (i) upon actual receipt or refusal by the addressee by hand; or (ii) three (3)
business days after having been deposited in the United States mail, certified, return receipt requested,
sufficient postage affixed and prepaid; or (iii) one (1) business day after having been deposited with an
expedited, overnight courier service (such as by way of example but not limitation, U.S. Express Mail,
Federal Express or Purolator), addressed to the party to whom notice is intended to be given at the address
set forth below:
Sublessor: Wynnwood Army, LLC
c/o Matthews Southwest
320 W Main Street
Lewisville, Texas 75057
Attn: Kristian Teleki
Telephone: (972) 221-1199
Email: kteleki@matthewssouthwest.com
With a Copy To: Koons Real Estate Law
1410 Robinson Road, Unit 100
Corinth, Texas 76210
Attn: Tiffany Sanford
Telephone: (214) 954-0067
Email: tsanford@koonsrealestatelaw.com
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Sublessee: Argo SMI Tribute, LLC
17330 Preston Road, Suite 100C
Dallas, Texas 75252
Attn: Chris Petty
Telephone: (972) 789-1400
Email: cpetty@suntex.com
With a Copy To: Spencer Fane LLP
2200 Ross Avenue, Suite 4800 West
Dallas, Texas 75201
Attn: Brian DeVoss
Telephone: (214) 765-6423
Email: bdevoss@spencerfane.com
A party may change its notice address by delivering ten (10) days’ prior written notice to the other party.
Section 15.14. Fees or Commissions. Each party hereby represents and warrants to the other,
that it has neither contacted nor entered into an agreement with any real estate broker, agent, finder, or any
other party in connection with this transaction, or taken any action that would result in any real estate
broker’s, finder’s, or other fees or commissions being due or payable to any other party with respect to the
transaction contemplated by this Sublease. Each party hereby indemnities and agrees to hold the other
party harmless from any loss, liability, damage, cost, or expense (including reasonable attorney’s fees)
resulting to the other party from a breach of the representation made by the indemnifying party in this
Section 15.14.
Section 15.15. Counterparts. This Sublease may be executed in multiple counterparts, each of
which shall be deemed an original, and all of which shall constitute one and the same instrument.
Section 15.16. Actions for Nonpayment of Rent and Other Charges. Sublessee shall not for
any reason withhold or reduce Sublessee’s required payments of rentals and other charges provided in this
Sublease, it being agreed that the obligations of Sublessor hereunder are independent of Sublessee’s
obligations, except as may be otherwise expressly provided.
Section 15.17. Limitation of Liability.
(a) Limitation of Sublessor’s Liability. Sublessee specifically agrees to look
solely to all of Sublessor’s interest in the Tribute Marina Park and Sublessor Improvements for
the recovery of any judgments against Sublessor. Sublessor (and Sublessor’s shareholders,
venturers, and partners, and their shareholders, venturers, and partners, and all of their officers,
directors, and employees) shall not be personally liable for any such judgments.
(b) Limitation of Sublessee’s Liability. Sublessor specifically agrees to look solely
to all of Sublessee’s interest in the Demised Premises and Sublessee Improvements for the
recovery of any judgments against Sublessee. Sublessee (and Sublessee’s shareholders,
members, venturers, and partners, and their shareholders, members, venturers, and partners, and
all of their officers, directors, managers, and employees) shall not be personally liable for any such
judgments.
The limitation of liability contained in this Section 15.17 shall apply equally and inure to the benefit of the
party’s successors, and their respective present and future partners, members, beneficiaries, officers,
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managers, directors, trustees, shareholders, agents, and employees, and their respective heirs, successors,
and assigns.
Section 15.18. Force Majeure. Whenever a period of time is herein prescribed for action to be
taken by Sublessor, Sublessor shall not be liable or responsible for, and there shall be excluded from the
computation of any such period of time, any delays due to Force Majeure.
Section 15.19. No Recording. The parties agree not to place this Sublease of record or any
memorandum of lease for this Sublease of record.
Section 15.20. Governing Law; Provisions Severable. The laws of the State in which the
Demised Premises are situated shall govern the interpretation, validity, performance and enforcement of
this Sublease. If any provision of this Sublease should be held to be invalid or unenforceable, the validity
and enforceability of the remaining provisions of this Sublease shall not be affected thereby. Venue for
any action under this Sublease shall be the county in which the Demised Premises are located.
Section 15.21. Short Form Lease. The parties agree not to place this Sublease or record, but
each party shall, at the request of the other, execute and acknowledge so that the same may be recorded a
short form lease or memorandum of lease, stating that Sublessee has accepted possession of the Demised
Premises, indicating the lease term and any options to extend such term, but omitting rent and other terms,
and an agreement specifying the date of commencement and termination of the lease term; provided,
however, that the failure to record said short form lease, memorandum of lease or agreement shall not affect
or impair the validity and effectiveness of this Sublease. The party requesting such recording shall pay all
costs, taxes, fees and other expenses in connection with or prerequisite to recording.
Section 15.22. Interest on Late Payments. In the event any installment of Annual Rental or any
other sum payable by Sublessee to Sublessor under the provisions of this Sublease is not received by
Sublessor from Sublessee within five (5) days of the date it is due and payable, Sublessee shall pay to
Sublessor an additional sum (Late Charge) equal to five percent (5%) of the amount due. Furthermore, in
the event any installment of Annual Rental or any other sum payable by Sublessee to Sublessor under the
provisions of this Sublease is not received within ten (10) days after its due date for any reason whatsoever,
it is agreed that the amount thus due shall bear interest at the maximum contractual rate which legally could
be charged under the laws of the State in which the Demised Premises are situated in the event of a loan of
such rental or other sum to Sublessee (but in no event to exceed 1-1/2% per month), such interest to accrue
continuously on any unpaid balance due to Sublessor by Sublessee during the period commencing with the
aforesaid due date and terminating with the date on which Sublessee makes full payment of such amounts
to Sublessor. Any such interest shall be payable as additional rent hereunder and shall be payable
immediately on demand. In addition to any other charges permitted herein, if Sublessee makes a payment
to Sublessor by check and said check is returned to Sublessor by Sublessee’s bank marked NSF (Not
Sufficient Funds), “Account Closed,” or is dishonored for some similar reason, then an additional charge
of $25.00 per check shall be paid by Sublessee to Sublessor.
Section 15.23. AS IS/No Warranties/Covenants of Performance. It is expressly stipulated
and agreed that the Demised Premises shall be leased “AS IS,” in its present condition, and with all faults
and defects, whether known or unknown to either Sublessee or Sublessor, or both. Sublessee
acknowledges that its decision to lease the Demised Premises is based solely upon Sublessee’s
comprehensive inspection of the Demised Premises and not upon any warranty or representation of
Sublessor, or of Sublessor’s employees, agents, or representatives, with regard thereto. It is expressly
stipulated and agreed that none of the obligations to be undertaken hereunder by Sublessor shall constitute
any form of a warranty, express or implied, all such obligations being contractual covenants of performance.
Without limiting the generality of the foregoing, THERE IS NO WARRANTY, EXPRESS OR IMPLIED,
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OF SUITABILITY, MERCHANTABILITY, HABITABILITY, OR FITNESS FOR ANY PARTICULAR
PURPOSE GIVEN IN CONNECTION WITH THIS SUBLEASE. The parties agree that the herein
provision disclaiming warranties, express and implied, and the provisions hereof under which Sublessee
assumes responsibility for repairs under Section 10.1 hereof, are provisions bargained for by the parties in
entering into this Sublease. The parties further agree that had warranties been undertaken by the Sublessor
hereunder or were the Sublessor to undertake to perform repairs beyond that contemplated hereunder, the
economics of this Sublease would have been affected and would have required an increase in rent from that
payable hereunder.
Section 15.24. Entire Agreement and Amendments. This Sublease embodies the entire
agreement between Sublessor and Sublessee and supersedes all prior agreements and understandings,
whether written or oral, and all contemporaneous oral agreements and understandings relating to the subject
matter hereof. Except as otherwise specifically provided herein, no agreement hereafter made shall be
effective to change, modify, discharge or effect an abandonment of this Sublease, in whole or in part, unless
such agreement is in writing and signed by or on behalf of the party against whom enforcement of the
change, modification, discharge or abandonment is sought.
Section 15.25. Dispute Resolution. If a dispute arises with respect to this Sublease, the parties
to the dispute shall first attempt to resolve it through direct discussions in the spirit of mutual cooperation.
If the parties’ attempts to resolve their disagreements through negotiation fail, the dispute shall be mediated
by a mutually acceptable third-party to be chosen by the disputing parties within thirty (30) days after
written notice by one of them demanding mediation. The disputing parties shall share the costs of the
mediation equally. By mutual agreement the parties may postpone mediation until each has completed
some specified but limited discovery about the dispute. By mutual agreement the parties may use another
nonbinding form of dispute resolution other than mediation. Any nonbinding dispute resolution process
conducted under the terms of this section shall be confidential within the meaning of Tex. Civ. Prac. and
Rem. Code Sec. 154.053 and 154.073. If neither a negotiated or mediated resolution is obtained within
the time periods provided by this section, the parties may pursue any available legal or equitable remedy.
Section 15.26. Bankruptcy or Insolvency. Sublessor and Sublessee agree that if Sublessee
becomes the subject of a bankruptcy proceeding under the Federal Bankruptcy Laws, as now enacted or
hereinafter amended, then “adequate protection” of Sublessor’s interest in the Demised Premises pursuant
to the provisions of Sections 361 and 363 (or their successor sections of the Bankruptcy Code, 11 U.S.C.
§101, et seq.) prior to the assumption and/or assignment of this Sublease by Sublessee shall include, but
not be limited to all (or any part) of the following:
(1) The continued payment by Sublessee of all rent and other sums due and owing under this
Sublease and the performance of all other covenants and obligations under this Sublease by
Sublessee; and
(2) The furnishing of a security deposit by Sublessee in the amount of three times the then-
current monthly Annual Rental payable hereunder.
Notwithstanding anything in this Sublease to the contrary, all amounts payable by Sublessee to or on
behalf of Sublessor under this Sublease, whether or not expressly denominated as “rent,” shall constitute
“rent” for the purposes of §502 (b) (7) of the U.S. Bankruptcy Code. If this Sublease is assigned to any
person or entity pursuant to the provisions of the Bankruptcy Code, any and all monies or other
considerations payable or otherwise to be delivered in connection with such assignment shall be paid and
delivered to Sublessor, shall be and remain the exclusive property of Sublessor and shall not constitute
property of Sublessee or the estate of Sublessee within the meaning of the U.S. Bankruptcy Code. Any
and all monies or other considerations constituting Sublessor’s property under the preceding sentence not
97
43
paid or delivered to Sublessor shall be held in trust by Sublessee for the benefit of Sublessor and shall be
promptly paid to or turned over to Sublessor.
[Signature Page Follows]
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44
EXECUTED as of the day, month, and year first above written.
Sublessor: Sublessee:
WYNNWOOD ARMY, LLC, Argo SMI Tribute, LLC,
a Texas limited liability company a Delaware limited liability company
By: Wynnwood Army Management, Inc.,
a Texas corporation By:
Its: Sole Manager Name:
Title:
By:
Name:
Title:
99
Exhibit “A”
Metes and Bounds Legal Description of the Park Area
Being a parcel of land located in the City of the Colony, Denton County, Texas, a part of the B.B.B. &
C.R.R. Survey, Abstract 170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett
Survey, Abstract 751, and also being a part of that United States of America Remainder of Tract C-239A
recorded in Volume 384, Page 162, Deed Records Denton County, Texas, and being further described as
follows:
BEGINNING at a five-eighths inch iron rod with yellow cap stamped “CARTER BURGESS” found at the
northeast corner of that called 252.107 acre tract of land described in Memorandum of Lease Agreement
between Wynnwood Army, LLC and Wynnwood Peninsula Golf, LLC as recorded in Volume 4154, Page
1595, Deed Records Denton County, Texas, said point also being in the west line of Tract 3 called 107.317
acres as described in deed to Tribute Partners, L.P. as recorded in Document Number 2010-69114, Denton
County Deed Records;
THENCE along the north line of said 252.107 acre tract as follows:
South 88 degrees 36 minutes 12 seconds West, 511.84 feet to a five-eighths inch iron rod found for corner;
North 48 degrees 05 minutes 13 seconds West, 355.55 feet to a point for corner, said point being the
northwest corner of said 252.107 acre tract;
THENCE North 30 degrees 58 minutes 59 seconds East, 657.06 feet to a Corp of Engineers monument
found at the southwest corner of Tract 23 called 250.65 acres as described in deed to Tribute Partners, L.P.
as recorded in Document Number 2010-69110, Denton County Deed Records, said point also being in the
east line of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE along the south line of said Tract 23 as follows:
North 89 degrees 54 minutes 20 seconds East, 192.65 feet a Corp of Engineers monument found for corner;
North 87 degrees 58 minutes 59 seconds East, 238.88 feet to a one-half inch iron rod found for corner;
South 04 degrees 08 minutes 26 seconds East, 31.84 feet to a point for corner, said point also being the
northwest corner of Tract 21 called 23.486 acres as described in deed to Tribute Partners, L.P. as recorded
in Document Number 2010-69114, Denton County Deed Records;
THENCE along the west line of said Tract 21 as follows:
South 00 degrees 18 minutes 25 seconds East, 299.92 feet to a point for corner;
South 00 degrees 20 minutes 14 seconds East, 465.40 feet to the POINT OF BEGINNING and containing
491,064 square feet or 11.273 acres of land.
100
Exhibit “A-1”
Water Area
101
Exhibit “A-2”
Future Building Parcel
BEING a parcel of land located in the City of the Colony, Denton County, Texas, a part of the B.B.B. &
C.R.R. Survey, Abstract 170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett
Survey, Abstract 751, and also being a part of that United States of America Remainder of Tract C-239A
recorded in Volume 384, Page 162, Deed Records Denton County, Texas, and being further described as
follows:
BEGINNING at a Corp of Engineers monument found at the southwest corner of Lot 2, Block A, Beach
Club at Tribute, an addition to the City of The Colony recorded in Document Number 2020-64, Official
Public Records of Denton County, Texas, said point also being in the east line of Garza-Little Elm Dam
and Reservoir (Lake Lewisville);
THENCE along the south line of said Lot 2, Block A as follows:
North 89 degrees 55 minutes 28 seconds East, 192.54 feet to a Corp of Engineers monument found for
corner;
North 87 degrees 58 minutes 59 seconds East, 201.54 feet to a point for corner;
THENCE South 17 degrees 07 minutes 24 seconds West, 15.97 feet to a point for corner;
THENCE Southwesterly, 35.36 feet along a curve to the left having a central angle of 09 degrees 01 minutes
26 seconds, a radius of 224.50 feet, a tangent of 17.72 feet and whose chord bears South 12 degrees 36
minutes 41 seconds West, 35.32 feet to a point for corner;
THENCE South 89 degrees 55 minutes 30 seconds West, 121.78 feet to a point for corner;
THENCE Southwesterly, 222.99 feet along a curve to the left having a central angle of 89 degrees 39
minutes 25 seconds, a radius of 142.50 feet, a tangent of 141.65 feet and whose chord bears South 45
degrees 05 minutes 49 seconds West, 200.92 feet to a point for corner;
THENCE South 00 degrees 04 minutes 30 seconds East, 39.94 feet to a point for corner;
THENCE Southwesterly, 21.45 feet along a curve to the right having a central angle of 50 degrees 10
minutes 23 seconds, a radius of 24.50 feet, a tangent of 11.47 feet and whose chord bears South 25 degrees
00 minutes 41 seconds West, 20.78 feet to a point for corner;
THENCE Southwesterly, 50.01 feet along a curve to the left having a central angle of 43 degrees 44 minutes
32 seconds, a radius of 65.50 feet, a tangent of 26.29 feet and whose chord bears South 28 degrees 13
minutes 37 seconds West, 48.80 feet to a point for corner;
THENCE North 64 degrees 03 minutes 08 seconds West, 221.84 feet to a point for corner in the east line
of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE North 30 degrees 58 minutes 59 seconds East, 221.13 feet along the east line of Garza-Little Elm
Dam and Reservoir (Lake Lewisville) to the POINT OF BEGINNING and containing 61,294 square feet
or 1.407 acres of land.
102
103
Exhibit “B”
Site Plan
104
Exhibit “C”
Marina Facilities
105
Exhibit “D”
Design of Park Facilities
106
107
Exhibit “E”
Drawing and Table of Parking
108
109
Exhibit “F”
Approved Sublessee Plans and Specifications for the Sublessee Improvements
Those certain plans approved in the City’s Ordinance No. 2022-2493, Site Plan – “Tribute Lakeside Park
and Marina”, a copy of which ordinance Sublessor and Sublessee received prior to the Effective Date of
this Sublease.
110
Exhibit “G”
Approved Sublessor Plans and Specifications for the Sublessor Improvements
Those certain plans approved in the City’s Ordinance No. 2022-2493, Site Plan – “Tribute Lakeside Park
and Marina”, a copy of which ordinance Sublessor and Sublessee received prior to the Effective Date of
this Sublease.
111
Exhibit “H”
USACE Marina Local Policies
That certain Policy Guidance for Outgrant Management – Administration of Areas Leased for Recreation
or Concession Purposes, Public or Private, Document No. CESWF-RE/CESWF-OD, Revised 15 July 2019,
prepared by Department of the Army, Fort Worth District, U.S. Army Corps of Engineers, P.O. Box 17300,
Fort Worth, Texas 76102-0300, which is 40 pages and a copy of which was delivered by Sublessor to
Sublessee prior to the Effective Date of this Sublease.
112
Exhibit “I.1”
Shoreline Erosion Control Proposal
113
114
Exhibit “I.2”
Sublessee Erosion Control Proposal
115
116
Exhibit “J”
Temporary Construction Access
117
13406\024\Tribute Sublease
GROUND SUBLEASE AGREEMENT
This Ground Sublease Agreement (this "“Sublease")”) is entered into as of the ______ day of
_____________, 20__, by and between the Sublessor and the Sublessee hereinafter named.
ARTICLE I.
Section 1.1. Fundamental Lease Provisions.
(1) Sublessor: Wynnwood Army, LLC, a Texas limited liability company
(2) Sublessor'sSublessor’s Address: c/o Matthews Southwest
Attn: Kristian Teleki
320 West Main Street
Lewisville, Texas 75057
Attn: Kristian Teleki
T:
Telephone: (972-) 221-1199
F: 972-221-1217
Email: kteleki@matthewssouthwest.com
(3) Sublessee: Argo SMI Tribute Marina SMI, LLC, a Delaware limited liability
company, (the “Sublessee”).
(4) Sublessee'sSublessee’s Address: 17330 Preston Road, Suite 100C
Dallas, Texas 75252
Attention: Ron TenEyckAttn: Chris Petty
T: Telephone: (972-) 789-1400
F: 972-763-0300
Email: rteneyck@suntexmarinascpetty@suntex.com
(5) Commencement Date: The date that is twelve (12) months after the date all Construction
Conditions are satisfied in their entirety, subject to extension as provided in Section 6.1 below.
(6) Demised Premises : Approximately 11.273 acres, more or less, of land located in Wynnwood
Park in The Colony, Denton County, Texas as more particularly described by metes and bounds on
Exhibit "“A"” attached hereto and incorporated herein by reference (the "“Park Area")”) plus
approximately 81.745 acres of submerged land, as more particularly described in the drawing of
the Water Lease Boundary on Exhibit "“A-1"” attached hereto and incorporated herein by reference
(the "“Water Area")”) along with (i) any and all improvements located in, on or across the
Demised Premises, including but not limited to the Marina Facilities (defined below), the Park
Facilities (defined below), and any other Improvements (defined below), all as more particularly
designated and depicted on Exhibit "“B"” attached hereto and incorporated herein by reference (the
"“Site Plan");”); and (ii) any and all rights to all easements and appurtenances in, on and across
the Demised Premises or in any way pertaining to the Demised Premises; provided, however, the
Future Building (defined below) is not included in the Demised Premises.
(7) Marina Facilities: The Marina Facilities will consist of a maximum of 801 wet slips to be situated
on approximately 42 acres, plus or minus of the Demised Premises and allocated by the Corps
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under the Corps Lease and City Sublease, gangways from the docks to the Top of Flowage
Easement (hereinafter defined) identified as "“Trail to Marina"” (the "“Gangways"),”), facilities
for the rental of jet skis and boats, licensing of wet slips, boat club, boat sales and fuel sales
including a fuel tanks and tank fill station located on the Park Area (the "“Fuel Tanks"),”), a fuel
dispenser dock and store (the "“Gas Station"),”), and a convenience store. Sublessor and Sublessee
agree that not all of the wet slips will be constructed by Sublessee as part of the Initial Marina
Facilities (defined below). The construction of the Sublessee Improvements, including but not
limited to the Marina Facilities, is planned for a phased construction sequence consisting of two or
more phases. During the First Phase of the Project (defined below), the Marina Facilities will
consist of a minimum of 399 wet slips, the Gas Station, and the Fuel Tanks located on the Park
Area, as more specifically set forth on the Design of the Marina Facilities attached hereto as Exhibit
"“C"” and incorporated herein and described in the Sublessee Plans and Specifications
(collectively, the "“Initial Marina Facilities").”). The size of the Marina Facilities, including but
not limited to the exact number of wet slips above the minimum of 399 wet slips, will be determined
by Sublessee, in its sole discretion, based on what Sublessee deems is reasonable and prudent. If
at any time and from time to time during the Term of this Sublease, Sublessee elects, in its sole
discretion, to construct additional wet slips, then the Marina Facilities will be expanded to include,
and consist of, the additional number of wet slips, as will be determined by Sublessee, in its sole
discretion, along with necessary improvements (each a “Future Phase” and collectively “Future
Phases”) and to provide access to and from all wet slips as more specifically shown on Exhibit
"“C".”. The exact number of additional wet slips to be added to the Marina Facilities from time
to time will be determined by Sublessee, in its sole discretion, based on what Sublessee deems is
reasonable and prudent, provided, the total number of wet slips does not exceed the maximum
number of wet slips allocated by the Corps under the Corps Lease, the City Sublease and the
Sublessee Plans and Specifications. The Marina Facilities must comply with the Corps Lease, City
Sublease and applicable Governmental Regulations.
(8) Park Facilities: The Park Facilities will be a public neighborhood park constructed by Sublessor
on the Park Area, including Parking (defined below) for the Park Facilities, Park Area, and the
Marina and will consist of improvements and open areas constructed by Sublessor, including but
not limited to the following as specifically shown on the Design of the Park attached hereto as
Exhibit "“D"” and incorporated herein by reference and described in the Sublessor Plans and
Specifications: the restroom building and EMS equipment storage building, a multi-purpose
lawn/special event area with a sloping hill for additional seating, picnic areas, lawn games, stage
(with electric) and multi-purpose lawn, concrete trails, two (2) concrete access walkways to the
Gangways, and sand volleyball court. The Park Facilities will have fully- gated access. During
the First Phase of the Project (defined below), Sublessor will construct and complete the Park
Facilities in their entirety together with a minimum of 172 paved vehicle parking spaces and 50
paved golf cart parking spaces. Any material modifications to the Park Facilities shown on Exhibit
"“D"” and set forth in the Sublessor Plans and Specifications are subject to Sublessee'sSublessee’s
prior approval, which approval will not be unreasonably withheld, conditioned or delayed;
provided, however, Sublessee'sSublessee’s approval will not be required for changes needed to
keep the costs of Sublessor Improvements within the $7,800,000.00 budget as provided in Section
6.3 below. Sublessor will deliver prior written notice to Sublessee of any changes to the Park
Facilities improvements intended to be made by Sublessor. Sublessor and Sublessee acknowledge
and agree that the Park Facilities must be open to the public as provided in the Corps Lease and
City Sublease. Section 1 of the City Second Amendment (hereinafter defined) sets forth the
current uses that are permitted under the City Sublease.
(9) Parking: Parking for the Marina Facilities and Park Facilities will consist of 467 paved parking
spaces (358 vehicle parking spaces and 109 golf cart parking spaces) and up to 167 unpaved parking
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spaces for special event parking, by separate permit, as needed. Parking will be adequate for the
marina uses and park uses and will be in accordance with the attached Sublessor Plans and
Specifications and as shown in the attached diagram and identified as "“Parking"” (the
"“Parking")”) on Exhibit "“E".”. The number of parking spaces to be included in the Parking will
be shared on an unreserved basis by the Marina Facilities, the Park Facilities, and the Future
Building and will be based, in part, on the maximum number of permitted wet slips set forth in the
Sublessee Plans and Specifications, and in no event shall the amount of parking spaces for the
Marina Facilities be less than what is required by Governmental Regulation in order to legally
operate the Marina Facilities.
(10) Primary Sublease Term: Commencing on the Commencement Date and ending on March 31,
2058, unless terminated earlier as expressly provided herein. The parties acknowledge that the end
of the Primary Sublease Term is the same end date of the lease term under the Corps Lease.
(11) Monthly Rent: $0 each month for the first twelve (12) full calendar months after the
Commencement Date and Five Percent (5%) of Gross Sales (defined herein) each month
commencing on the first day of the thirteenth (13th) full calendar month after the Commencement
Date and continuing each month thereafter throughout the Primary Sublease Term.
(12) Permitted Uses: Any and all uses associated with (a) the Marina Facilities, which marina use has
been previously approved by the U.S. Army Corps of Engineers (the "“Corps")”) under the Corps
Lease and the City of The Colony, Texas (the "“City")”) under the City Sublease, including but
not limited to the Gas Station; (b) the Park Facilities and the Parking; (c) the Fuel Tanks located
within the Park Area; and (d) such other uses permitted under Section 1 of the City Second
Amendment (hereinafter defined) to the City Sublease. Sublessor and Sublessee acknowledge and
agree that dry storage operations and a public boat ramp are not permitted on the Demised
Premises.
(13) Possession: Sublessor will give possession of the Demised Premises to Sublessee to begin
operation of the Demised Premises as of the substantial completion of the Park Facilities and
Parking, which completion may be evidenced by receipt of either a City acceptance letter for civil
plan improvements or a certificate of occupancy for all or any portion of the Demised Premises
(such as for the restroom); provided, however, Sublessee is permitted to access the Demised
Premises for Sublessee'sSublessee’s construction of the Initial Sublessee Improvements
(hereinafter defined) at any time after the Effective Date but prior to the date of Possession.
Sublessee'sSublessee’s access to, over, and across the Demised Premises for construction of the
Initial Marina Facilities will be through the location generally shown in Exhibit "“J"” attached to
and made a part of this Sublease (the "“Temporary Construction Access"),”), but in no event will
any construction access be through the Park Facilities. Sublessee'sSublessee’s possession of the
Park Facilities will be on a non-exclusive basis and will be subject to Sublessor License set forth
in Section 10.4 below; provided, however, the Fuel Tank and Trash Dumpster Areas shall be
excluded from the Sublessor License and Sublessee shall have exclusive possession of the Fuel
Tank and Trash Dumpster Areas.
(14) Construction Conditions: "“Construction Conditions"” shall mean Sublessor and Sublessee
shall receive: (i) all required permits, approvals and licenses from all governmental authorities
(including but not limited to the Corps and City) to construct or install the Sublessor Improvements
and the Sublessee Improvements, including but not limited to the approval of the Fuel Tanks as
part of the Marina Facilities, in accordance with Sublessee'sSublessee’s plans, and to allow the use
and occupancy of the Demised Premises; (ii) a copy of all required permits, approvals, and licenses
from all governmental authorities (including but not limited to the Corps and City) for Sublessee
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to construct or install the Gas Station in accordance with Sublessee'sSublessee’s plans and to allow
the use of the Gas Station; and (iii) all necessary lease amendments executed by all applicable
parties, including but not limited to Sublessor and the Corps and the City, amending the leased
premises under the Corps Lease, if and to the extent necessary, to incorporate and include all of the
Demised Premises. The required permits include, but may not be limited to, the Fuel Tanks and
piping permit (to be obtained by Sublessee).
(15) Wynnwood Park: “Wynnwood Park” shall mean that certain park located in Denton County,
Texas comprised of approximately 650 acres leased to the City by the Corps and subsequently
subleased by the City to Wynnwood Peninsula, L.P.
(16) First Phase of the Project: “First Phase of the Project” shall mean the twenty-four (24) month
period beginning on the Effective Date of this Sublease and ending on the last day of the twenty-
fourth (24th) full calendar month thereafter.
(17) Sublessor License:“Sublessor License” shall mean the license granted by Sublessee to Sublessor
as set forth in Section 10.4 of this Sublease.
(18) Tribute Marina Park: “Tribute Marina Park” shall mean all of the: (i) the land shown on the
Site Plan attached as Exhibit "“B"” and incorporated herein for all purposes and all improvements
of every kind thereon or associated therewith; (ii) the Park Area, Park Facilities, Parking and all
improvements, easements and licenses of every kind thereon or associated therewith, and (iii) the
Water Area, Marina Facilities and all improvements, easements and licenses of every kind thereon
or associated therewith.
Section 1.2. Additional Definitions:
(1) "“Association"” means The Tribute Owners Association, Inc., which is the Texas property
owners association for The Tribute community.
(2) "“Effective Date"” means the date this Sublease is signed by Sublessor and Sublessee.
(3) "“Governmental Regulations"” means all laws, ordinances, rules, regulations, statutes, building
codes and other matters of all governmental authorities having jurisdiction over the Demised
Premises, including all health, environmental and regulatory requirements.
(4) "“Top of Flowage Easement"” means the line on the shore that is at an elevation of 537 feet, as
adjusted by the Corps from time to time.
(5) "“Sublessee Improvements"” means the real and personal property improvements to be
constructed by Sublessee as part of the Demised Premises, including the Initial Marina Facilities
up to the Top of Flowage Easement and revetments and erosion control for the shoreline (the
“Marina Shoreline”) remediation work (the "“Initial Sublessee Improvements"),”), and all
additional real and personal property improvements, including but not limited to any and all
additional wet slips added to the Marina Facilities, all as more particularly set forth in the plans and
specifications approved in accordance with the terms of this Sublease ("(“Sublessee Plans and
Specifications")”) attached hereto as Exhibit "“F"” and constructed from time to time by Sublessee
in accordance with the terms of this Sublease (collectively, the “Sublessee Improvements”). The
Fuel Tanks must be located above the Top of Flowage Easement. Sublessor and Sublessee
acknowledge and agree that as of the Effective Date of this Sublease the parties are attaching
conceptual plans and specifications for the Sublessee Improvements. Sublessor and Sublessee
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agree that final detailed Sublessee Plans and Specifications for the Sublessee Improvements
approved by all required parties in accordance with this Sublease will be attached as Exhibit "“F"”
prior to Sublessor and Sublessee commencing construction of any kind on the Demised Premises.
(6) "“Sublessor Improvements"” means the real and personal property improvements above the Top
of Flowage Easement to be constructed by Sublessor on the Park Area, including but not limited to
the Park Facilities, Parking improvements, revetments and erosion control as needed for the
shoreline remediation work (the “Park Shoreline”), and utility infrastructure improvements to be
made on the Park Area, all as more particularly set forth in the plans and specifications approved
in accordance with the terms of this Sublease ("(“Sublessor Plans and Specifications")”) attached
hereto as Exhibit "“G"” and constructed by Sublessor in accordance with the terms of this Sublease.
Sublessor Improvements do not include the Fuel Tanks. Sublessor and Sublessee acknowledge and
agree that as of the Effective Date of this Sublease the parties are attaching conceptual plans and
specifications for the Sublessor Improvements. Sublessor and Sublessee agree that final detailed
Sublessor Plans and Specifications for the Sublessor Improvements approved by all required parties
in accordance with this Sublease will be attached as Exhibit "“G"” prior to Sublessor and Sublessee
commencing construction of any kind on the Demised Premises.
(7) "“Improvements"” means collectively the Sublessee Improvements and the Sublessor
Improvements.
(8) "“Corps Lease"” means that certain Lease No. DACW63-1-08-0613 dated June 9, 2008, by and
between the Secretary of the Army (on behalf of the United States) and the City (the "“Original
Corps Lease"),”), as amended by that certain First Amendment to Lease No. DACW63-1-08-0613
(the "“Corps First Amendment"),”), and as further amended, if applicable (collectively, the
"“Corps Lease").”).
(9) "“City Sublease"” means that certain Ground Lease Agreement dated July 21, 1997, by and
between the City and Sublessor (the "“Original Sublease"),”), as amended by that certain First
Amendment to Ground Lease Agreement dated July 20, 1998 (the "“City First Amendment"),”),
that certain Second Amendment to Ground Lease Agreement dated April 21, 2008 (the "“City
Second Amendment"),”), that certain Third Amendment to Ground Lease Agreement dated on or
about the Effective Date of this Sublease (the "“City Third Amendment"),”), and as further
amended, if applicable (collectively (the “City Sublease”).
(10) "“Leasehold Mortgage"” means any mortgage, deed of trust or similar lien on the leasehold estate
of Sublessee hereunder.
(11) "“Leasehold Mortgagee"” means the holder of any Leasehold Mortgage or other purchaser at a
foreclosure or other sale pursuant to the terms of a Leasehold Mortgage that has acquired the
leasehold estate under this Sublease by foreclosure.
(12) “Sublessor’s Lender” has the meaning set forth in Section 12.5 of this Sublease.
(13) "“Sublessor’s Mortgage"” has the meaning set forth in Section 12.5 of this Sublease.
(14) "“District Engineer"”means the U.S. Army District Engineer for the Fort Worth District who is
in charge of the administration of the Lewisville Lake Project Area.
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(15) “Future Building” means the future building area proposed to be constructed by Sublessor within
a parcel of approximately 1.4 acres described and shown on Exhibit "“A-2",”, together with all
improvements constructed on such parcel by Sublessor.
Section 1.3. Effect of Reference to Fundamental Lease Provisions and Definitions. Each
of the foregoing definitions and fundamental lease provisions shall be construed in conjunction with and
limited by the references thereto in the other provisions of this Sublease.
ARTICLE II.
Section 2.1.Demised Premises. In consideration of the obligation to Sublessee to pay rent as
herein provided and in consideration of the other terms, covenants and conditions hereof, Sublessor hereby
demises and leases to Sublessee, and Sublessee hereby takes from Sublessor, the Demised Premises as
described in Section 1.1(76), TO HAVE AND TO HOLD the Demised Premises for the Primary Lease
Term, all upon the terms and conditions set forth in this Sublease. Sublessor further agrees that if
Sublessee performs all of the covenants and agreements herein required to be performed by Sublessee and
otherwise subject to the terms of this Sublease, Sublessee shall have peaceful and quiet possession of the
Demised Premises at all times after the delivery of Possession of the Demised Premises as set forth in
Section 1.1(15) and during the continuance of this Sublease. Sublessee acknowledges that this Sublease
is subject to the Corps Lease and the City Sublease and this Sublease will not be effective until approved
in writing by the Commander or District Engineer for the Corps and by the City. Sublessee acknowledges
that rights retained by the Secretary of the Army under the Corps Lease include, but are not limited to, the
right to flood the Demised Premises and the right to change the Lewisville Lake level.
ARTICLE III.
TERM
Section 3.1.Primary. The term of this Sublease shall commence on the Commencement Date
and continue in full force and effect for the Primary Sublease Term, subject to extension and earlier
termination as provided herein. Notwithstanding anything to the contrary contained in this Sublease, if all
of the Construction Conditions have not been satisfied in their entirety on or before twelve (12) months
after the Effective Date, then either Sublessor or Sublessee shall have a one-time right to terminate this
Sublease at any time prior to the Commencement Date by delivering written notice to the other party;
provided, however, so long as the party that has not been successful in satisfying all of its respective
Construction Conditions within such 12-month period has commenced and is proceeding in good faith and
with due diligence to satisfy any remaining Construction Conditions, then the other party shall not have a
right to terminate this Sublease under this Section 3.1. Upon satisfaction of all Construction Conditions,
Sublessee will reimburse Sublessor for one-half (1/2) of the actual cost and expense (up to and not to exceed
$87,500.00) incurred by Sublessor related to the Corps and City approvals and permits issued for the Marina
Facilities in accordance with the Sublessee Plans and Specifications prepared by Sublessee and approved
by Sublessor as attached hereto as Exhibit "“F"” and such reimbursement will be paid by Sublessee to
Sublessor within 30 days after delivery of the invoices for such expenses.
Section 3.2.Renewal. In the event that the Corps Lease is extended beyond the Primary
Sublease Term, the City Sublease is still in effect, and Sublessee is not in default under this Sublease at the
time of exercise or commencement, the term of this Sublease may be extended, at Sublessee'sSublessee’s
option, for the lesser time period of (i) the same extended term under the Corps Lease or (ii) the term under
the City Sublease (the "“Renewal Lease Term").”). Sublessor will use good faith efforts to notify
Sublessee if the Corps Lease is extended beyond the Primary Sublease Term. The option for the Renewal
Lease Term may be exercised by Sublessee by written notice to Sublessor at least 180 days before the end
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of the Primary Sublease Term. Upon the timely giving of such 180-day notice, the renewal and extension
of this Sublease for such Renewal Lease Term shall be on and under the same covenants, agreements, terms,
provisions, and conditions that are contained herein for the Primary Sublease Term, except that the Annual
Rental for such Renewal Term shall be determined based on fair market rent as mutually agreed by
Sublessor and Sublessee (but in no event will the Annual Rental for such Renewal Lease Term be less than
the Annual Rental for the last year of the Primary Lease Term) and all leasehold improvements within the
Demised Premises shall be provided in their then existing condition (on an "“AS-IS"” basis) at the time the
Renewal Lease Term commences. If Sublessor and Sublessee cannot agree upon the Annual Rental for
the Renewal Lease Term, then the parties will use an appraisal process mutually acceptable to Sublessor
and Sublessee to determine the fair market rent to base the Annual Rental on for the Renewal Lease Term.
Sublessee will have no option to renew this Sublease beyond the expiration of the Renewal Lease Term.
ARTICLE IV.
RENTAL
Section 4.1.Construction & Initial Operations Period. Except as otherwise provided
herein, no rent is due from Sublessee for the period from the Effective Date to the Commencement Date.
Section 4.2.Annual Rental. Sublessee shall to pay to Sublessor on the first day of each
calendar month after the Commencement Date for which this Sublease is in effect, in lawful money of the
United States of America, one-twelfth (1/12) of the Annual Rental (herein so called), as stated below, for
the applicable "“lease year"” herein defined as a period of twelve (12) consecutive calendar months which
shall commence on the Commencement Date if the Commencement Date occurs on the first day of a
calendar month, otherwise the first lease year shall commence on the first day of the first calendar month
next following the Commencement Date:
(1) Primary Term. The Annual Rental for the Primary Sublease Term, commencing with
the Commencement Date, is payable in monthly installments as follows:
Primary Term Annual Rental Monthly Installment
Year 1 $0 $0
Years 2 through expiration of the Primary
Sublease Term
5% of the Gross Revenues
(except as otherwise
provided in Section 4.4(2)
below)
Monthly portion of Annual
Rental
Section 4.3. Net Rental. The Annual Rental payable by Sublessee hereunder is a "“net"”
rental that is owed Sublessor under this Sublease and does not include taxes, utilities, or insurance costs for
the Demised Premises.
Section 4.4. Rental Calculation. Annual Rental shall be the percentage rental determined by
multiplying the total Gross Sales (defined below) in or from the Demised Premises during the particular
Lease Year by the percentage rental rate stated in Section 4.2 (1) above. The percentage rental shall accrue
as of the Commencement Date and shall be paid in monthly installments in arrears for the prior month on
or before the tenth (10th) calendar day of each month during the term of this Sublease. Additionally, on or
before the 120th calendar day after the end of the applicable Lease Year, Sublessee shall pay to Sublessor,
a sum of money equal to the product of the percentage rental factor hereinabove specified, multiplied by
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the total Gross Sales made in or from the Demised Premises during such preceding Lease year to the extent
not previously paid in the monthly installments.
Section 4.4.(1).Fractional Years. If the Commencement Date is on a date other than the first
day of a calendar year or terminate on a date other than the last day of a calendar year, percentage rental for
such fractional part of the calendar year following the Commencement Date or preceding the termination
date, as the case may be, shall be paid at the specified rate for all Gross Sales made during such fractional
part of a calendar year.
Section 4.4.(2).Definition of Gross Sales. The term "“Gross Sales,",” as used herein, shall be
construed to include the entire amount of the sales price, whether for cash or credit or otherwise, of all sales
of Slip Licenses (hereinafter defined), slip or dock improvements for holders of Slip Licenses per Section
5.2.(5) below, boat rentals, boat sales, Parking Fees (hereinafter defined), merchandise, food, drinks and
services (including receipts whatsoever of all business conducted in or from the Demised Premises),
including mail, to-go or telephone orders received or filled at the Demised Premises, deposits not refunded
to purchasers, orders taken although filled elsewhere, sales to employees, sales through vending machines
or other devices, and sales by any sublessee, concessionaire or licensee or otherwise in said Demised
Premises, subject to the limitations and exclusions set forth below. Each sale upon installment or credit
shall be treated as a sale for the full price in the month during which such sale was made and earned,
irrespective of the time when Sublessee receives payment from its customer. Notwithstanding the
foregoing or anything to the contrary contained in this Sublease, Sublessee will only be required to pay two
percent (2%) of Gross Sales for all fuel and gasoline sales and one percent (1%) of all of Gross Sales for
all boat, watercraft and motor sales consummated on the Demised Premises by a manufacturer, retailer or
wholesaler of boats and watercraft. Gross Sales shall also not include, however, any sums collected and
paid out for any sales or excise tax imposed by any duly constituted governmental authority, nor shall it
include the exchange of merchandise between the stores of Sublessee, if any, where such exchanges are
made solely for the convenient operation of the business of Sublessee and not for the purpose of
consummating a sale which has theretofore been made in or from the Demised Premises and/or for the
purpose of depriving Sublessor of the benefit of a sale which otherwise would be made in or from the
Demised Premises, nor the amount of returns to shoppers or manufacturers, nor the amount of any cash or
credit refund made upon any sale where the merchandise sold, or some part thereof, is thereafter returned
by purchaser and accepted by Sublessee, nor sales of Sublessee'sSublessee’s trade fixtures after use by
Sublessee in the Demised Premises. Except to the extent modified by the terms of this Sublease, it is the
intent of the parties that the calculation of Gross Sales under this Sublease comply with the calculation of
"“Gross Revenues"” as defined in the City Sublease. Provided, however, if and to the extent there is a
conflict between the calculation of Gross Sales under this Sublease and the calculation of Gross Revenues
under the City Sublease, the calculation requirements in this Sublease will apply.
Section 4.4.(3).Statement of Gross Sales. On or before the 120th day of each Lease Year during
the term of this Sublease, Sublessee shall prepare and deliver to Sublessor, at the place where rental is then
payable, a statement certified as correct by an independent Certified Public Accountant showing the amount
of Gross Sales made during the preceding Lease Year. Such statement may be included in a company-
wide financial statement for Sublessee'sSublessee’s parent or direct holding company if (a) such company-
wide financial statement includes a separate line item for the Gross Sales under this Sublease or (b) such
independent Certified Public Accountant provides a separate letter in a form reasonably acceptable to
Sublessor certifying the Gross Sales under this Sublease. Sublessor and Sublessee agree that Sublessee
will engage a reputable local accounting firm to be the initial independent Certified Public Accountant. In
addition, within thirty (30) days after the termination of this Sublease if this Sublease does not terminate at
the end of a Lease Year, Sublessee shall prepare and deliver to Sublessor, at the place where rental is then
payable, a statement of Gross Sales during the preceding calendar year (or partial calendar year), certified
to be correct by an independent Certified Public Accountant. Sublessee shall furnish similar statements
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for its licensees, concessionaires and sub-sublessees, if any. All such statements shall be in such form as
the Sublessor may reasonably require. If any such certified statement discloses error in the calculation of
the percentage rental for any period, appropriate adjustment of the percentage rental shall be made, subject,
however, to Sublessor'sSublessor’s rights under Section 4.4.(5).
Section 4.4.(4).Sales Records. Sublessee shall keep in the Demised Premises or at the
Sublessee'sSublessee’s principal office in the DFW area, which is listed in Section 1.1.(4) above, a
permanent, accurate set of books and records of all sales of merchandise and services and revenue derived
from business conducted in or about the Demised Premises, and all supporting records, including, but not
limited to, sales, income and other tax reports, banking records, cash register tapes, sales slips and other
sales records. All such books and records shall be retained and preserved for at least twenty-four (24)
months after the end of the calendar year to which they relate, and shall be subject to inspection and audit
by Sublessor and its agents at all reasonable times.
Section 4.4.(5).Audit. In the event Sublessor is not satisfied with the statements of Gross Sales
submitted by Sublessee, Sublessor shall have the right to have its auditors make a special audit of all books
and records, wherever located, pertaining to sales made in or from the Demised Premises. If such
statements are found to be incorrect to an extent of more than five percent (5%) over the figures submitted
by Sublessee, Sublessee shall pay for such audit. Sublessee shall promptly pay to Sublessor any deficiency
or Sublessor shall promptly refund to Sublessee any overpayment, as the case may be, which is established
by such audit. Sublessee acknowledges that the City has audit rights under the City Sublease and agrees
to comply with the requirements of any audit by the City.
ARTICLE V.
USE OF DEMISED PREMISES
Section 5.1.Use. The Demised Premises shall be used by Sublessee only for the Permitted
Uses specified in Section 1.1.(14) above, and for no other purpose without the prior written consent of
Sublessor, the City and the Corps. The Demised Premises may only be used by Sublessee as permitted by,
and in full and strict compliance with, all Governmental Regulations, the Corps Lease, the City Sublease
and any restrictive covenants applicable to the Demised Premises. Sublessor and Sublessee acknowledge
that no structures may be erected or altered on the Demised Premises unless and until the type of use, design
and proposed location or alteration have been approved in writing by the District Engineer and the City.
Sublessee agrees to use commercially reasonable efforts to maintain and operate the Marina Facilities as a
first-class lake marina.
Section 5.2.Limitations on Use.
(1) Sublessee shall not keep anything within the Demised Premises or use the Demised
Premises for any purpose which invalidates any insurance policy carried on the Demised Premises. All
property kept, stored or maintained within the Demised Premises by Sublessee shall be at
Sublessee'sSublessee’s sole risk.
(2) Sublessee shall not permit any objectionable or unpleasant odors to emanate from the
Demised Premises; nor place any antenna, awning or other projection on the exterior of the Demised
Premises (other than those indicated on the Sublessee Plans and Specifications for the Sublessee
Improvements and otherwise approved in advance by Sublessor in writing); nor take any other action which
would constitute a nuisance. Sublessee shall comply with local noise ordinances in the operation of radios,
televisions, loudspeakers or amplifiers on the Demised Premises.
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(3) Sublessee shall take good care of the Demised Premises and keep the same free from waste
at all times. Sublessee shall keep the Demised Premises neat, clean and free from dirt or rubbish at all
times, and shall store all trash and garbage within the Demised Premises. Sublessee shall arrange for the
regular pickup of such trash and garbage at Sublessee'sSublessee’s expense. Sublessee shall not operate
an incinerator or burn trash or garbage.
(4) Sublessee covenants and agrees that during the Sublease it will (a) maintain appropriate
certifications and licenses for the Permitted Uses and (b) use commercially reasonable efforts to maximize
the Gross Sales generated therefrom consistent with sound business practices and Sublessee'sSublessee’s
concurrent goal of maximizing its net operating income therefrom.
(5) Sublessee covenants and agrees that it will impose and enforce rules and regulations on
holders of Slip Licenses and users of the Marina Facilities to help with maintaining and operating the
Marina Facilities in a first-class manner, which rules and regulations will include, but not be limited to, the
following: (a) the USACE Marina local policies described in Exhibit "“H"” attached hereto; (b) quiet
hours will be maintained during the hours required by the then-current City noise ordinance; (c) any
petroleum leaking from the bilge or any other part of a vessel must be cleaned up immediately by the vessel
owner or operator; (d) all watercraft must be in good repair, neat condition and clean; (e) pets must be
leashed while on the docks and pet owners are required to clean up after their pets; (f) no open flames are
to be allowed on the docks; (g) advertising or soliciting is not permitted except in an area designated for
such purpose by Sublessee; (h) if storage lockers are permitted under the Slip Licenses, storage lockers
must be placed over the wet marina slip or on the slip patio (not in the walkway) and all personal property
and equipment must be stored within such storage locker; (i) fishing and cast netting are not permitted from
the docks or slips; (j) swimming and diving are not permitted in the waters of the Marina Facilities; and (k)
any additions or improvements desired by holders of Slip Licenses including, but not limited to, electrical,
decking, cabinetry, t.v. mounts, boat lifts) must be performed by Sublessee in accordance with standard
design options to be submitted by Sublessee to the Corps and the City for approval.
Section 5.3. Disclaimer of Representations and Warranties. Sublessor makes no
representations or warranties, express, implied, or otherwise, as to the suitability of the Demised Premises
for use by Sublessee nor as to the Sublessee'sSublessee’s intended use of the Demised Premises being in
compliance with any deed restrictions, laws, regulations, rules, ordinances, building codes, zoning
requirements, or other similar restrictions on use. Sublessee acknowledges that it has checked applicable
restrictions, laws, building codes, zoning requirements, rules, regulations and ordinances to determine that
the Sublessee'sSublessee’s intended use of the Demised Premises is authorized and permitted by law.
ARTICLE VI.
DESIGN, CONSTRUCTION, INSTALLATION AND LIEN CLAIMS
Section 6.1.Construction of Improvements. Promptly after the Commencement Date, each
party agrees to use commercially reasonable efforts to cause the Improvements required of the respective
party to be constructed on the Demised Premises all in accordance with the terms of this Sublease and the
Sublessor Plans and Specifications and Sublessee Plans and Specifications. Such construction shall be
done in a workmanlike manner and with the use of quality materials. Construction of the Sublessee
Improvements and the Sublessor Improvements shall be at the constructing party'sparty’s respective risk
and each party shall pay promptly all costs of construction associated with the portion of the Improvements
for which it is responsible, which shall include, but not by way of limitation, (a) all contract charges (labor,
material and services furnished by contractors and subcontractors), (b) all costs of labor and material, (c)
engineering costs, and (d) all other costs and expenses (insurance, administrative, governmental permits,
zoning, etc.), including, but not limited to, the cost of site clearing, site preparation, fill, compaction and
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grading with soil acceptable to build the proposed Improvements. As between Sublessor and Sublessee,
construction of the Sublessor Improvements and the Sublessee Improvements shall conclusively be deemed
to be substantially completed upon delivery to Sublessee of a certificate of occupancy signed by a City
building inspector or any other applicable authority for the Marina Facilities, which must include 399 wet
slips or such greater number of wet slips as Sublessee, in its sole discretion, determined was reasonable and
prudent to construct (up to and not to exceed the permitted number), ready for use and all necessary
infrastructure improvements necessary on the Demised Premises which are required by the applicable
authorities prior to Sublessee open operations consistent with the Permitted Uses.
Sublessor will use commercially reasonable efforts to complete the Sublessor Improvements within
twenty-four (24) months after the Commencement Date (subject to Force Majeure) (the "“Sublessor
Completion Deadline").”). Upon substantial completion of the Sublessor Improvements, Sublessor will
deliver written notice to Sublessee. If from time to time Sublessor desires, in its sole discretion, to construct
additional improvements not mentioned in the Sublessor Plans and Specifications, Sublessor will deliver
written notice to Sublessee and Sublessee will have thirty (30) days to approve or disapprove
Sublessor'sSublessor’s request to construct the additional Sublessor improvements. Such approval by
Sublessee will not be unreasonably withheld, conditioned or delayed. The parties agree that
Sublessee'sSublessee’s consent is not required in the event Sublessor makes non-material modifications
and changes to the Sublessor Improvements.
Sublessee will use commercially reasonable efforts to complete the Initial Sublessee Improvements
within twenty-four (24) months after the Commencement Date subject to Force Majeure (the "“Sublessee
Completion Deadline").”). Notwithstanding the foregoing, Sublessor and Sublessee acknowledge and
agree that until such time as Sublessor delivers a written notice to Sublessee regarding the substantial
completion of the Sublessor Improvements, Sublessee will utilize the Temporary Construction Access to
access and construct the Initial Sublessee Improvements. Upon substantial completion of the Initial
Sublessee Improvements, Sublessee will deliver written notice to Sublessor. If from time to time Sublessee
desires, in its sole discretion, to construct additional improvements not mentioned in the Sublessee Plans
and Specifications, Sublessee will deliver written notice to Sublessor and Sublessor will have thirty (30)
days to approve or disapprove Sublessee'sSublessee’s request to construct the additional Sublessee
improvements. Such approval by Sublessor will not be unreasonably withheld, conditioned or delayed. The
parties agree that Sublessor'sSublessor’s consent is not required in the event Sublessee makes non-material
modifications and changes to the Sublessee Improvements.
If the Sublessor Improvements have not been substantially completed prior to the substantial
completion of the Initial Sublessee Improvements, then the Commencement Date (as defined in Section
1.1.(5) above) shall automatically be extended by one day for each day after the substantial completion of
the Initial Sublessee'sSublessee’s Improvements that it takes Sublessor to reach substantial completion of
the Sublessor Improvements.
Notwithstanding anything to the contrary contained herein, Sublessee will contribute to Sublessor
$1,000,000.00 of the total costs of Sublessor Improvements (the "“Infrastructure Contribution").”).
Upon satisfaction of the conditions set forth in Section 6.6 below and execution by Sublessor and the
contractor of the construction contract for the Sublessor Improvements, Sublessee will escrow 20% of the
Infrastructure Contribution with Republic Title of Texas, Inc. or such other escrow agent agreed upon by
Sublessor and Sublessee pursuant to a separate written escrow agreement (the "“Infrastructure Escrow
Agreement").”). The Infrastructure Escrow Agreement will provide for (i) Sublessee to deposit the
remaining 80% of the Infrastructure Contribution by depositing a minimum of an additional 20% of the
Infrastructure Contribution every 45 days until the full amount of the Infrastructure Contribution has been
deposited into escrow under the Infrastructure Escrow Agreement, (ii) the right of Sublessor to require
Sublessee'sSublessee’s minimum periodic deposits to be more than 20% by notifying Sublessee in writing
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at least 25 days prior to the due date of the next deposit of the larger amount needed to be deposited by
Sublessee (up to the full amount of the Infrastructure Contribution) in order to meet an upcoming draw
request by Sublessor under the Infrastructure Escrow Agreement, (iii) Sublessee to deliver to Sublessor an
irrevocable standby letter of credit for the undeposited portion of the Infrastructure Contribution with a
term of six (6) months (which letter of credit will terminate when the full amount of the Infrastructure
Contribution has been deposited into escrow under the Infrastructure Escrow Agreement), and (iv) a draw
request procedure by which Sublessor can use the Infrastructure Contribution to pay for a portion of the
Sublessor Improvements.
Sublessee shall have the right to install its merchandise, goods, and fixtures and equipment on the
Demised Premises during the completion of the Sublessor Improvements by Sublessor. Each party agrees
to indemnify and hold harmless the other party against any loss, liability or damage resulting from each
party'sparty’s (or its agents or contractors) construction of their respective portion of the Improvements.
Section 6.2.Ownership of Improvements. All of the Sublessee Improvements, and all other
improvements of any nature constructed by Sublessee on the Demised Premises including alterations,
modifications, and additions of the Improvements pursuant to the provisions of this Sublease, shall be
owned by and shall be the property of Sublessee. Upon the termination of this Sublease by reason of a
Sublessee Event of Default, Sublessor will own the Sublessee Improvements and all parts thereof after the
date of termination of this Sublease. Subject to the provisions of Article XII hereof, Sublessee shall deliver
the Demised Premises to Sublessor in reasonably good condition, actual wear and tear excepted, upon the
termination or expiration of the term of this Sublease.
Section 6.3.Construction Costs. Sublessee shall pay the actual cost and expense incurred in
construction of the Sublessee Improvements, in accordance with the Sublessee Plans and Specifications
prepared by Sublessee and approved by Sublessor and Sublessor shall pay the actual cost and expense
incurred in construction of the Sublessor Improvements (the "“Construction Costs"),”), in accordance with
the Sublessor Plans and Specifications prepared by Sublessor and approved by Sublessee. However, if the
estimated Construction Costs for the Sublessor Improvements exceed $7,800,000.00, then (a) Sublessor
may change the scope and type of improvements that will be included in the Sublessor Improvements in
order to keep the Construction Costs for the Sublessor Improvements within the $7,800,000.00 budget, (b)
except as provided in subsections (c) and (d) of this Section 6.3, such changes may be made without
Sublessee'sSublessee’s consent, but Sublessor will notify Sublessee in writing of any changes to the scope
or type of Sublessor Improvements, (c) if such changes to the plans for Sublessor Improvements will reduce
the number of parking spaces below what is required by the Governmental Regulations to operate the
maximum number of wet slips included in the Sublessee Plans and Specifications for the Sublessee
Improvements, Sublessor must obtain Sublessee'sSublessee’s prior written approval of such changes, which
approval will not be unreasonably withheld, conditioned, or delayed, and (d) if such changes will be to the
scope, type or location of utilities serving the Demised Premises, Sublessor must obtain
Sublessee'sSublessee’s prior written approval of such changes, which approval will not be unreasonably
withheld, conditioned or delayed. Except as provided in Section 6.1 above, under no circumstances
whatsoever shall the non-responsible party be obligated to make any payments or incur any expense in
connection with construction of Improvements by the other party.
Section 6.4.Force Majeure. The time for the performance of Sublessee'sSublessee’s and
Sublessor'sSublessor’s obligations relative to the construction, restoration, repair, operation and
maintenance of the Improvements as provided for in this Sublease shall be extended for the period that such
performance is prevented by failures or delays in a party'sparty’s performance of its obligations hereunder
caused by acts of God, acts of the public enemy, wars, blockades, epidemics, earthquakes, floods,
explosions, strikes, riots, insurrections, or lawful acts of any governmental agency or authority restricting
or curtailing the construction of the Improvements or withholding or revoking necessary consents,
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approvals, permits or licenses or failure or inability to procure and obtain needed building materials
(provided such party who is unable to do so makes reasonable efforts to procure satisfactory substitute
materials if practical) whether as a result (directly or indirectly) of any lawful order, law or decree of any
governmental authority or agency or otherwise (collectively, "“Force Majeure").”). The inability of a
party to secure funds required to perform its agreements hereunder shall not constitute Force Majeure.
Upon occurrence of an event of Force Majeure the affected party will deliver notice thereof to the other
party so that the parties can keep track of the number of days of delay that are attributable to Force Majeure.
The parties agree that in no event may the completion of the Sublessee Improvements or the Sublessor
Improvements be delayed more than twelve (12) months in the aggregate for Force Majeure causes.
Section 6.5.Sublessee'sSublessee’s Work. Except as otherwise expressly provided herein,
Sublessee shall have no right, authority or power to bind Sublessor, or any interest of Sublessor in the
Demised Premises, for any claim for labor or material or for any other charge or expense incurred in
connection with any construction work done by Sublessee within the Demised Premises or any change,
alteration or addition thereto, or replacement or substitution therefor, nor to render the
Sublessor'sSublessor’s interest in the Demised Premises liable to any lien or right of lien for any labor or
material or any other charge or expense incurred in connection therewith, and Sublessee shall in no way be
considered as the agent of Sublessor in the construction of operation of the Improvements or any
replacement or substitution therefor.
Section 6.6.Zoning, Permits & Approval of Corps and City. Irrespective of any other
provisions of this Sublease or additions thereto, the obligations of Sublessor and Sublessee under this
Sublease are conditioned upon (a) approval of the Sublessor Plans and Specifications and Sublessee Plans
and Specifications for the Improvements by the Corps and the City, (b) replatting of the Property, if
necessary, in accordance with applicable law, and (c) the issuance of appropriate building permits for the
construction of the Improvements upon the Demised Premises. Sublessor hereby agrees to cooperate fully
with Sublessee in securing the aforesaid permits and approvals as they relate to the Sublessee
Improvements, at no cost to Sublessor, including, but not limited to, timely executing applications for such
permits and approvals and hereby grants Sublessee the right to make application for them in the name of
Sublessor, if necessary. Sublessee agrees that all plans for the Sublessee Improvements must be submitted
first to Sublessor for review and approval and, upon Sublessor'sSublessor’s approval, then may be
submitted to the City for review and approval. As requested by the Corps, all submittals of such plans to
the Corps will be made by the City rather than by Sublessor or Sublessee. If required by the District
Engineer or the City, Sublessee will deliver complete "“as built"” construction plans of the Sublessee
Improvements to the District Engineer, the City and Sublessor upon completion of the Sublessee
Improvements. All expenses incurred by Sublessee or Sublessor in obtaining the permits and
authorizations referred to in this Paragraph shall be the responsibility of the party responsible for the
construction of the respective Improvements and the other party shall have no liability for the permitting
costs associated with Improvements for which they are not responsible.
Section 6.7.Discharge of Liens. If any mechanic's, materialman'smechanic’s, materialman’s
or other types of liens or lien claims are filed against the whole or any part of the Demised Premises, arising
or resulting from actions or omissions by the constructing party, then the constructing party shall promptly
secure their release, or if the constructing party wishes to contest any such lien or claim and has a reasonable
basis for a contest, the constructing party may do so, but only if the constructing party furnishes the non-
constructing party with surety bonds or escrow funds ("(“Construction Security")”) sufficient in amount
to protect the non-constructing party'sparty’s interest in the Demised Premises and the parties'parties’
interests in this Sublease during the pendency of the contest. If the constructing party does not secure a
lien release or furnish Construction Security, such failure shall constitute an event of default by the
constructing party hereunder and, in addition to all other rights and remedies available to the non-
constructing party by reason thereof, the non-constructing party may, after thirty (30) days'days’ prior
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written notice, pay such lien or claim and secure such release, and the constructing party shall be obligated
to reimburse the non-constructing party for all sums reasonably expended by the non-constructing party in
paying such lien or claim and securing such release, including attorney'sattorney’s fees, plus interest at the
highest lawful rate from the date of the non-constructing party'sparty’s payment until it is reimbursed.
Nothing contained in this Section 6.7 or elsewhere in this Sublease shall be deemed or construed as an
authorization by or consent of Sublessor or Sublessee to the filing of any mechanic'smechanic’s or
materialman'smaterialman’s lien against all or any portion of the Demised Premises or any interest therein.
ARTICLE VII.
SECURING GOVERNMENTAL APPROVALS AND COMPLIANCE WITH LAW
Section 7.1.Compliance with Laws.
Section 7.1.(1).
(a) Subject to the provision of subsection (b) below, Sublessee, at Sublessee'sSublessee’s sole
cost and expense, shall obtain any and all governmental licenses, permits, and approvals necessary
to construct or install the Sublessee Improvements and to allow the use and occupancy of the
Demised Premises. Sublessee shall comply and shall require any sub-sublessees of the Demised
Premises comply, at all times with (i) all applicable Governmental Regulations for the use of the
Demised Premises, and (ii) all governmental orders for the correction, prevention and abatement
of nuisances arising from Sublessee'sSublessee’s and/or the sub-sublessees use of the Demised
Premises, all at Sublessee'sSublessee’s and/or sub-sublessee'ssublessee’s sole cost and expense.
(b) Sublessor, at Sublessor 's‘s sole cost and expense, shall obtain any and all governmental
licenses, permits, and approvals necessary to construct or install the Sublessor Improvements and,
as part of substantial completion, either a City acceptance letter for civil plan improvements or a
certificate of occupancy, as applicable, for the Park Facilities, Park Area, and Parking.
Sublessor'sSublessor’s obligations under this subsection (b) terminate as of the substantial
completion date of the Sublessor Improvements.
Section 7.1.(2).
(a) Subject to the provisions of subsection (b) below, Sublessee shall procure at its sole
expense any permits and licenses required for the transaction of business in the Demised Premises
and/or in any way related to the Demised Premises and shall comply with all laws, ordinances,
regulations and orders now in effect or hereafter enacted or passed during the term of this Sublease
insofar as the Demised Premises and any signs of Sublessee are concerned, and shall, except as
herein otherwise provided, make at Sublessee'sSublessee’s own cost and expense all repairs,
additions and alterations to the Demised Premises ordered or required by any governmental
authorities, whether in order to meet the special needs of Sublessee, or by reason of the occupancy
of Sublessee, or otherwise.
(b) Prior to substantial completion of the Sublessor Improvements, Sublessor shall procure at
its sole expense any permits and licenses required for Sublessor’s transaction of business in or use
of the Park Area and Park Facilities and shall comply with all laws, ordinances, regulations and
orders now in effect or hereafter enacted or passed prior to the substantial completion of the
Sublessor Improvements. Sublessor'sSublessor’s obligations under this subsection (b) terminate as
of the substantial completion date of the Sublessor Improvements.
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Section 7.1.(3).
(a)Sublessee'sSublessee’s compliance with all applicable laws, rules, and regulations shall
include, but not be limited to, full compliance with (a) all federal, state, and local laws, rules, and
regulations concerning the possession, storage, use, disposal of and clean-up relating to any and all
types of hazardous wastes, as the term "“Hazardous Wastes"” is defined by applicable
Governmental Regulations, and (b) the Americans with Disabilities Act and Americans with
Disabilities Act Accessibility Guidelines as they apply to the Sublessee Improvements and, after
the substantial completion date of the Sublessor Improvements, as they apply to the Sublessor
Improvements for any changes required after the substantial completion date that are made by
Sublessee.
(b)Sublessor'sSublessor’s compliance with all applicable laws, rules, and regulations shall
include, but not be limited to, full compliance with (a) all federal, state, and local laws, rules, and
regulations concerning the possession, storage, use, disposal of and clean-up relating to any and all
types of hazardous wastes, as the term "“Hazardous Wastes"” is defined by applicable
Governmental Regulations, and (b) the Americans with Disabilities Act and Americans with
Disabilities Act Accessibility Guidelines as they apply to the Sublessor Improvements prior to the
substantial completion date. During the construction of the Sublessor Improvement until the
substantial completion date of the Sublessor Improvements, Sublessor shall be responsible for
compliance with Governmental Regulations applicable to the construction of the Sublessor
Improvements. Sublessor'sSublessor’s obligations under this subsection (b) terminate as of the
substantial completion date of the Sublessor Improvements.
Section 7.1.(4).
(a) Subject to the provisions of subsection (b) below, Sublessee shall obtain any and all needed
regulatory approvals, licenses, and/or permits relating to the operation of its business, its occupancy
of the Demised Premises, and any other such approvals, licenses or permits relating in any way to
the Demised Premises during the Primary Sublease Term, including, but not limited to, any such
governmental approvals, permits or licenses relating to chemicals, petroleum products, hazardous
materials, as the term "“Hazardous Materials"” is defined by applicable Governmental
Regulations, and/or Hazardous Wastes possessed, used, or stored on the Demised Premises by
Sublessee. Sublessee acknowledges that the Corps Lease requires prior written approval of the
District Engineer for any pesticides or herbicides before they are applied to the Demised Premises.
(b) Prior to substantial completion of the Sublessor Improvements, Sublessor shall obtain any
and all needed regulatory approvals, licenses, and/or permits relating to the operation of its business
and use of the Park Area, Park Facilities, and Parking, and any other such approvals, licenses or
permits relating in any way to Sublessor’s use of the Park Area, Park Facilities, and Parking,
including, but not limited to, any such governmental approvals, permits or licenses relating to
chemicals, petroleum products, hazardous materials, as the term "“Hazardous Materials"” is
defined by applicable Governmental Regulations, and/or Hazardous Wastes possessed, used, or
stored on the Park Area and Parking by Sublessor. Sublessor acknowledges that the Corps Lease
requires prior written approval of the District Engineer for any pesticides or herbicides before they
are applied to the Park Area and Parking. Sublessor'sSublessor’s obligations under this subsection
(b) terminate as of the substantial completion date of the Sublessor Improvements.
Section 7.1.(5).
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(a)Subject to the provisions of subsection (b) below, in the event of any accident or spillage
of any petroleum product, chemical, toxic compound, Hazardous Materials and/or Hazardous
Wastes on or at the Demised Premises during the Primary Sublease Term, as may be extended,
Sublessee shall comply with all federal, state and local laws, rules, and regulations pertaining
thereto, including notification of proper authorities, safety of all persons potentially affected,
evacuation of Demised Premises if necessary, clean-up and disposal. Additionally, Sublessee
shall be solely responsible for all costs associated with any spillage of any such compounds or
wastes on or at the Demised Premises and for the clean-up and disposal of any such compounds,
including Hazardous Wastes, on the Demised Premises which occur during the Primary Sublease
Term, as extended, in accordance with applicable laws, rules, and regulations unless and to the
extent caused by negligent act or omission of Sublessor.
(b)In the event of any accident or spillage of any petroleum product, chemical, toxic
compound, Hazardous Materials and/or Hazardous Wastes resulting from, caused by or arising out
of Sublessor or Sublessor’s employees, contractors or agents’ use of and activities on or at the Park
Area and Parking prior to the substantial completion of the Sublessor Improvements, Sublessor
shall comply with all federal, state and local laws, rules, and regulations pertaining thereto,
including notification of proper authorities, safety of all persons potentially affected, evacuation of
Park Area and Parking if necessary, clean-up and disposal. Additionally, Sublessor shall be solely
responsible for all costs associated with any spillage of any such compounds or wastes on or at the
Park Area and Parking and for the clean-up and disposal of any such compounds, including
Hazardous Wastes, on the Park Area and Parking which occur prior to the substantial completion
date of the Sublessor Improvements and which are resulting from, caused by or arising out of
Sublessor or Sublessor'sSublessor’s employees or contractors'contractors’ use of and activities on
or at the Park Area and Parking prior to the substantial completion date of the Sublessor
Improvements in accordance with applicable laws, rules, and regulations. Sublessor'sSublessor’s
obligations under this subsection (b) terminate as of the substantial completion date of the Sublessor
Improvements.
Section 7.2. Environmental Covenants.
Section 7.2.(1).
(a) Subject to the covenants of Sublessor set forth herein and the provisions of subsection 7.2.1.(b)
below, Sublessee covenants that during the Primary Sublease Term, as may be extended (a)
Sublessee shall not permit any toxic or hazardous substances, including, without limitation,
asbestos and the group of organic compounds known as polychlorinated biphenyls, to be generated,
treated, stored or disposed of, or otherwise deposited in or located on, or released on or to the
Demised Premises, including, without limitation, the surface the subsurface waters of the Demised
Premises, (b) Sublessee will not engage in and will not permit any other party to engage in any
activity on the Demised Premises which would cause (i) the Demised Premises to become a
hazardous waste treatment storage or disposal facility within the meaning of, or otherwise bring
the Demised Premises within the ambit of, the Resource Conservation and Recovery Act of 1975
("(“RCRA"),”), 42 U.S.C. '6901‘6901, et seq., as amended, or any similar state law or local
ordinance or other environmental law, (ii) a release or threatened release of a hazardous substance
from or to the Demised Premises within the meaning of, or otherwise bring the Demised Premises
within the ambit of, the Comprehensive Environmental Response, Compensation and Liability Act
of 1980 ("(“CERCLA"),”), 42 U.S.C. '9601‘9601-9657, as amended, or any similar state law or
local ordinance of any other environmental law, or (iii) the discharge of pollutants or effluents into
any water source or system, or the discharge into the air of any emissions, which would require a
permit under the Federal Water Pollution Control Act, 33 U.S.C. '1251‘1251, et sea., or the Clean
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Air Act, 42 U.S.C. '7401‘7401, et seq., or any similar state law or local ordinance or any other
environmental law, (c) Sublessee will not permit any substance or conditions in or on the Demised
Premises which might support a claim or causes of action under RCRA, CERCLA, or any other
federal, state or local environmental statutes, regulations, ordinances or other environmental
regulatory requirements, and (d) no underground storage tank will be located on or under the
Demised Premises, except as presently exists or as approved by Sublessor, the City, the Corps, and
the other applicable authorities. As used herein, the terms "“hazardous substance"” and
"“release"” shall have the meanings specified in CERCLA, and the terms "“solid waste"” and
"“disposal"” (or "“disposed")”) shall have the meanings specified in RCRA; provided, in the event
either CERCLA or RCRA is amended so as to broaden the meaning of any term defined thereby,
such broader meaning shall apply subsequent to the effective date of such amendment, provided
further, to the extent that the laws of the State of Texas establish a meaning for such terms which
is broader than that specified in either CERCLA or RCRA, such broader meaning shall apply.
(b) Sublessor covenants that prior to substantial completion of the Sublessor Improvements (a)
Sublessor shall not permit any toxic or hazardous substances, including, without limitation,
asbestos and the group of organic compounds known as polychlorinated biphenyls, to be generated,
treated, stored or disposed of, or otherwise deposited in or located on, or released on or to the Park
Area and Parking, including, without limitation, the surface the subsurface waters of the Park Area
and Parking, (b) Sublessor will not engage in and will not permit any other party to engage in any
activity on the Park Area and Parking which would cause (i) the Park Area and Parking to become
a hazardous waste treatment storage or disposal facility within the meaning of, or otherwise bring
the Park Area and Parking within the ambit of, the Resource Conservation and Recovery Act of
1975 ("(“RCRA"),”), 42 U.S.C. '6901‘6901, et seq., as amended, or any similar state law or local
ordinance or other environmental law, (ii) a release or threatened release of a hazardous substance
from or to the Park Area and Parking within the meaning of, or otherwise bring the Park Area and
Parking within the ambit of, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("(“CERCLA"),”), 42 U.S.C. '9601‘9601-9657, as amended, or any similar
state law or local ordinance of any other environmental law, or (iii) the discharge of pollutants or
effluents into any water source or system, or the discharge into the air of any emissions, which
would require a permit under the Federal Water Pollution Control Act, 33 U.S.C. '1251‘1251, et
sea., or the Clean Air Act, 42 U.S.C. '7401‘7401, et seq., or any similar state law or local ordinance
or any other environmental law, and (c) Sublessor will not permit any substance or conditions in or
on the Park Area and Parking which might support a claim or causes of action under RCRA,
CERCLA, or any other federal, state or local environmental statutes, regulations, ordinances or
other environmental regulatory requirements. Sublessor'sSublessor’s obligations under this
subsection (b) terminate as of the substantial completion date of the Sublessor Improvements.
Section 7.2.(2). In the event Sublessee or Sublessor is obligated by any applicable federal, state
or local law, ordinance or regulation or otherwise directed by any governmental agency or authority, to
clean up, remove or encapsulate or cause the clean-up, removal, or encapsulation of any Hazardous Wastes
and/or Hazardous Materials or asbestos or material containing asbestos ("(“Asbestos")”) from the
Demised Premises, the responsible party hereby guarantees to the non-responsible party it shall (i) promptly
undertake to arrange for such clean up, removal and disposal in accordance with all Governmental
Regulations, (ii) exercise its best efforts to insure that such clean up and removal shall be conducted in a
timely and diligent manner, and (iii) assume the costs and expense, including any fines, of such clean up
and removal.
Section 7.2.(3). In the event that any lien is recorded or filed against the Demised Premises
pursuant to any Governmental Regulations regarding Hazardous Materials, Hazardous Wastes, or Asbestos,
Sublessee hereby guarantees to Sublessor that Sublessee shall, not later than thirty (30) days following the
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filing of such lien, satisfy the claim and cause the lien thereunder to be discharged of record (whether by
payment, bonding or as otherwise provided by Section 7.2 hereof) unless such lien was caused by Sublessor
or resulted from any act of Sublessor.
Section 7.2.(4).
(a)In addition to the foregoing and subject to Sublessor’s obligations set forth in this Article
7VII, Sublessee shall protect, defend, indemnify and save harmless Sublessor, and
Sublessor'sSublessor’s agents, employees and representatives from and against all loss (including
diminution in the value of the Demised Premises), cost, damage, liability, obligation, causes of
action, fine, penalty or expense (including attorneys'attorneys’ fees and expenses for investigation,
inspection, removal, clean up, and remedial costs incurred to permit continued or resume normal
operation of the Demised Premises), imposed upon or incurred by or asserted against Sublessor by
reason of the following occurrences during the Primary Sublease Term, as may be extended (i) the
presence, disposal, escape, seepage, leakage, spillage, discharge, emission, release, or threatened
release of any Hazardous Materials and/or Hazardous Wastes on, from, or affecting the Demised
Premises or any other property or the presence of Asbestos on the Demised Premises; (ii) any
personal injury (including wrongful death) or property damage (real or personal) arising out of or
related to such Hazardous Wastes, Hazardous Materials or Asbestos; (iii) any lawsuit brought or
threatened, settlement reached, or government order relating to such Hazardous Wastes, Hazardous
Materials or Asbestos; or (iv) any violation of laws, orders, regulations, requirements, or demands
of governmental authorities, which are based upon or in any way related to such Hazardous Wastes,
Hazardous Materials or Asbestos including, without limitation, the costs and expenses of any
remedial action, attorney and consultant fees, investigation and laboratory fees, court costs, and
litigation expenses unless any such loss was caused by Sublessor or resulted from any act of
Sublessor.
(b)In addition to the foregoing and subject to Sublessee’s obligations set forth in this Article
7VII, Sublessor shall protect, defend, indemnify and save harmless Sublessee, and
Sublessee'sSublessee’s agents, employees and representatives from and against all loss (including
diminution in the value of the Demised Premises), cost, damage, liability, obligation, causes of
action, fine, penalty or expense (including attorneys'attorneys’ fees and expenses for investigation,
inspection, removal, clean up, and remedial costs incurred to permit continued or resume normal
operation of the Demised Premises), imposed upon or incurred by or asserted against Sublessee by
reason of Seller'sSeller’s breach of Section 7.1.(3).(b), Section 7.1.(4).(b), Section 7.1.(5).(b),
Section 7.2.(1).(b). or Section 7.2.(2).
Section 7.3.Storage Tanks. Sublessee shall be responsible for all existing fuel storage tanks
and lines located on the Demised Premises, including any maintenance, labor, and costs to keep current
with federal guidelines and any that Sublessee installs as permitted herein. Sublessee shall provide
annually to Sublessor all documentation that the fuel storage tanks have been maintained and are in
compliance with all laws and requirements of the underground storage tanks division of the applicable
jurisdiction and any other regulatory authorities. Notwithstanding anything to the contrary in this Sublease
and at all times during the term of this Sublease, Sublessor shall provide paved vehicular access to the Fuel
Tank for filling, operation and maintenance on an as needed, when needed basis, including but not limited
to access and accommodation sufficient for large ton and 18 wheel fuel trucks.
Section 7.4. Corps Lease and City Sublease. Sublessee agrees to comply with all provisions
under the Corps Lease and the City Sublease regarding Hazardous Materials or Hazardous Wastes and to
the extent there is a conflict among such provisions in this Sublease, the City Sublease and the Corps Lease,
the more restrictive requirement will apply.
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Section 7.5.Environmental Baseline. Notwithstanding anything to the contrary contained
herein, not less than thirty (30) days prior to the earlier of: (i) the date Sublessor commences construction
of the Sublessor Improvements; or (ii) the date Sublessee commences construction of the Sublessee
Improvements, Sublessee shall cause a Phase I Environmental Site Assessment ("(“ESA")”) shall be
performed on the Demised Premises at Sublessee'sSublessee’s sole cost. Further, if the ESA recommends
a Phase II ESA then a Phase II ESA shall also be performed (the Phase I ESA and any applicable Phase II
ESA shall form the "“Environmental Baseline"” for this Sublease. Any covenant, obligation or
indemnity of Sublessee set forth in this Article VII shall not extend to any claim, demand, fine, penalty,
cause of action, liability, damage, loss, cost or expense related to the presence of Hazardous Substances
that are documented in the Environmental Baseline.
ARTICLE VIII.
TAXES
Section 8.1.Taxes and Assessments. From and after the Effective Date, Sublessee shall pay,
before they become delinquent, all ad valorem taxes, assessments and other governmental charges and
impositions levied or assessed against Sublessee'sSublessee’s fixtures, equipment and personal property
on, attached to, or used in connection with the Demised Premises or any part thereof; provided, however,
that if any tax is payable in installments, Sublessee may also pay in installments, but all such taxes shall be
paid in full prior to the expiration of the Primary Sublease Term, as may be extended if applicable.
Sublessor shall promptly present Sublessee with copies of all tax bills received for each lease year for which
Sublessee is expressly responsible. Sublessee shall pay before they become delinquent all property taxes,
assessments and other governmental charges and impositions levied or assessed against the Demised
Premises or any part thereof, and the Sublessee Improvements. Sublessee shall have the right at
Sublessee'sSublessee’s election to protest the levy, assessment or collection of any taxes, assessments,
charges or impositions by appropriate legal action, provided that Sublessee shall not thereby permit any
lien (other than the lien for current taxes not yet due and payable) or judgment for any taxes, assessments,
charges or impositions to be filed or enforced against the Demised Premises. Upon the written request of
Sublessee, Sublessor will join with Sublessee in any such protest on the condition that Sublessee pay all of
the reasonable costs and expenses (including reasonable attorneys'attorneys’ fees and expenses) incurred
by Sublessor in connection with this joinder.
ARTICLE IX.
INSURANCE
Section 9.1.Insurance Requirements for Sublessee. From and after the Effective Date,
Sublessee shall maintain, at Sublessee'sSublessee’s sole cost and expense, insurance on the Demised
Premises as follows:
(1) Sublessee Improvements."“Special Risk"” Property Insurance against loss or damage
to Sublessee Improvements inclusive of Flood and Earthquake coverage, in amounts equal to the full
replacement cost, of Sublessee Improvements, as determined by insurance appraisals, one initially
conducted on or about the Commencement Date, and every lease year thereafter.
(2) Commercial General Liability. Commercial general liability insurance against claims
for bodily injury, death or property damage occurring on the Demised Premises in the amount of $5,000,000
and in the aggregate, with financially sound companies reasonably acceptable to Sublessor that have an
AM Best Rating of A-/VII or greater. Such limits shall be on a per location basis and may be achieved in
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combination of primary and excess policies. This coverage may be increased periodically to a level
appropriate under then market conditions and industry standards, as reasonably approved by the parties.
(3) Workers Compensation. Statutory Workers Compensation insurance covering all
persons employed by Sublessee in connection with any work done on the Demised Premises. Such
insurance shall also contain a $1,000,000 Employers Liability limit.
(4) Business Interruption Insurance. Business Interruption Insurance, providing in the
event of damage or destruction of the Demised Premises an amount sufficient to sustain Sublessee for a
period of not less than one (1) year for: (i) the net profit that would have been realized had
Sublessee'sSublessee’s business continued; and (ii) such fixed charges and expenses as must necessarily
continue during a total or partial suspension of business to the extent to which they would have been
incurred had no business interruption occurred, including, but not limited to, interest on indebtedness of
Sublessee, taxes and rents, and insurance premiums, and depreciation.
(5) Marina Operator'sOperator’s Legal Liability. Sublessee shall maintain Marina
Operators Legal Liability including Protection and Indemnity with limits not less than $2,000,000. Such
insurance shall provide care, custody and control coverage and primary P&I coverage for any vessel that
Sublessee owns, leases or operates.
(6) Auto Insurance. In owned, leases, hired, or non-owned vehicles are used by Sublessee
in connection with this Agreement, Sublessee shall maintain Auto Liability coverage in the amount of
$1,000,000 Combined Single Limit for Bodily Injury and Property Damage.
Each of Sublessor, the Corps and the City shall be an additional insured inclusive of ongoing and completed
operations per ISO forms CG 2010 and CG 2037 or equivalent, on all of the above policies (except the
Workers Compensation coverage) and shall annually be provided with confirmation that these coverages
are being maintained. The policies outlined in subsections 9.1.(2), 9.1.(4) and 9.1.(6) shall be primary and
non-contributory to any insurance that Sublessor, the Corps and the City may carry. Sublessee will
endeavor to deliver a copy of each of the above policies to Sublessor, the City and the Corps within ten (10)
days after the Commencement Date and thereafter a certificate of insurance evidencing the renewal at least
five (5) days prior to the expiration of each policy (and, upon Sublessor'sSublessor’s written request,
Sublessee will deliver a copy of the policy that was renewed). With respect to lien documents executed
by Sublessee in connection with the Demised Premises, Sublessee shall obtain the agreement of the
Leasehold Mortgagee to permit the proceeds of casualty insurance to be used to reconstruct or replace the
damaged Improvements. Sublessee agrees that to the extent there is a conflict between the insurance
requirements in this Sublease, the City Sublease or the Corps Lease, the higher standard will apply under
this Sublease. Such policies shall also be endorsed to provide to Sublessor thirty (30) days'days’ notice of
cancellation or non-renewal, or material change in coverage. The policies outlined in Sections 9.1.(2),
9.1.(4), and 9.1.(6) shall be primary and non-contributory to any insurance that Sublessor, the Corps or the
City may carry.
Section 9.2.Insurance Requirements for Sublessor Improvements. From and after the
Effective Date, Sublessor or Sublessee, as applicable, will maintain the following insurance on the Park
Area and Sublessor Improvements:
(1) From the Effective Date and through the date of substantial completion of the Sublessor
Improvements, Sublessor shall maintain, at its expense, commercial general liability insurance against
claims for bodily injury, death or property damage occurring on, in or about the Park Area in an amount
which is the lesser of the actual costs incurred by Sublessor for hard costs of construction of the Sublessor
Improvements or $5,000,000 and in the aggregate, with financially sound companies that have an AM Best
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Rating of A-/VII or greater. Such limits shall be on a per location basis and may be achieved in
combination of primary and excess policies. This coverage may be increased periodically to a level
appropriate under then market conditions and industry standards, as reasonably approved by the parties.
(2) As of the date of substantial completion of the Sublessor Improvements and continuing for
the term of this Sublease, Sublessee shall maintain, at its expense, commercial general liability insurance
against claims for bodily injury, death or property damage occurring on, in or about the Demised Premises
that includes the Sublessor Improvements in the aggregate amount of the lesser of (i) $5,000,000; or (ii) the
total hard costs incurred by Sublessor for the construction of the Sublessor Improvements. Such limits may
be achieved in combination of primary and excess policies.
Section 9.3.Waiver of Subrogation. Anything in this Sublease to the contrary
notwithstanding, Sublessor and Sublessee each hereby waive any and all rights of recovery, claim, action,
or cause of action, against the other, its agents, officers, or employees, for any loss or damage arising from
any cause covered by insurance required to be carried by each of them pursuant to this Sublease or any
other insurance actually carried by each of them, regardless of cause or origin, including negligence of the
other party hereto, its agents, officers, or employees, and covenants that no insurer shall hold any right of
subrogation against such other party. All insurance obtained by either Sublessee or Sublessor hereunder,
especially including the property damage insurance described herein shall contain appropriate waiver of
subrogation rights endorsements whereby the insurer releases all rights of subrogation against both
Sublessor and Sublessee and any and all sub-sublessees. Each party shall provide the other with copies of
such endorsements upon request.
ARTICLE X.
MAINTENANCE AND REPAIR; ALTERATIONS; UTILITIES; ACCESS; SECURITY
Section 10.1.Shoreline Erosion Control; Maintenance and Repair of Demised Premises.
(a)Subject to the provisions to Articles VI and XI hereof, Sublessee shall maintain in good
repair and condition the entire Demised Premises and all of the Sublessee Improvements, fixtures,
equipment and personal property on the Demised Premises, and keep them free from waste or
nuisance. Sublessee shall be responsible solely for the management of the Marina Shoreline
excluding costs associated with maintaining and repairing all or any portion of the shoreline and
erosion control with the exception of a one-time payment to Ark Contracting Services, LLC
(“Ark”) in the amount of $655,530.00 (the “Sublessee Revetment Payment”) as payment for the
“Total Project Cost” reflected on the shoreline erosion proposal from Ark dated November 11,
2022 attached as Exhibit “I.1” (the “Sublessee Erosion Control Proposal”), which amount
includes a twenty percent (20%) contingency. Sublessor shall be responsible for the management
of the Park Shoreline, including without exception Sublessor shall be responsible for the Sublessor
Revetment Costs. “Sublessor Revetment Costs” shall mean the sum of: (i) the actual costs to
construct the Park Shoreline as shown in Line Items 11 through 15 on the Shoreline Erosion Control
Proposal; and (ii) one-third of the costs required to address Items 1 through 7 of the Shoreline
Erosion Control Proposal, the total sum of which is estimated to be $708,744.00. The “Shoreline
Erosion Control Proposal” shall mean the shoreline erosion control proposal from Ark
Contracting Services, LLC (“Ark”) dated June 23, 2022 attached as Exhibit “I.2”. Notwithstanding
anything to the contrary in this Sublease, Sublessor and Sublessee acknowledge and agree that
Sublessee will not be responsible for any costs (other than the Sublessee Revetment Payment)
associated with or related to erosion control, maintenance and repair of the Marina Shoreline and
Park Shoreline. The parties agree that Sublessee shall maintain and operate the Sublessor
Improvements at Sublessee'sSublessee’s cost (except as otherwise provided below regarding the
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Parking Fee) from and after the substantial completion date of the Sublessee Improvements.
Sublessee agrees to comply with the annual certification required under the Corps Lease certifying
that all water and sanitary systems on the Demised Premises have been inspected and comply with
federal, state and local standards. At the expiration of the Sublease, Sublessee shall deliver the
Demised Premises and the Improvements to Sublessor in good condition, subject to normal wear
and tear.
(b)Parking. Sublessee intends to charge a fee to park in the Parking areas, which fee may
include a daily, monthly or annual use fee (each, a "“Parking Fee"” and collectively, the "“Parking
Fees").”). Sublessee will submit the proposed Parking Fees to the City for review as and when
required by the City. As of the date of execution of this Sublease, the City requires that any
Parking Fees be reviewed at least annually and any time Parking Fees are adjusted.
(c)Maintenance and Repair of Sublessor Improvements and Park Shoreline. Notwithstanding
any provision to the contrary in this Sublease from the Effective Date to the substantial completion
date of the Sublessor Improvements, Sublessor shall, at Sublessor’s sole cost: (i) maintain in
compliance, good repair and condition the Sublessor Improvements; and (ii) manage and maintain
the Park Shoreline.
Section 10.2.Alterations. Sublessee shall have the right, from time to time, to make additions,
alterations and changes to the Sublessee Improvements, including but not limited to increase the number of
wet slips in the Marina Facilities (not to exceed the permitted number), in accordance with the Sublessee
Plans and Specifications. Sublessee shall have the right, from time to time, to make other additions,
alterations and changes to improvements not mentioned in the Sublessee Plans and Specifications as
approved by the Corps, City and Sublessor (hereinafter sometimes referred to collectively as
"“alterations")”) (which term shall, when used in this Section include any replacement or substitution
therefor), provided that (a) at the time of such alteration there is no uncured default by Sublessee under this
Sublease, and (b) the right to make alterations is subject to the following:
(1) no structural alterations of the original facade or exterior of the Sublessee Improvements
shall be commenced except after receipt of Sublessor'sSublessor’s written approval of such alterations,
which approval Sublessor agrees not to unreasonably withhold, and after receipt of the Corps'Corps’ and
the City'sCity’s written approval if required under the Corps Lease and City Sublease;
(2) no alterations shall be made which would impair the structural soundness of the Marina
Facilities;
(3) no alterations shall be undertaken until Sublessee has furnished Sublessor reasonable
evidence that all building permits, licenses and authorizations of all municipal departments and
governmental authorities having jurisdiction and all required consents of Leasehold Mortgagees and the
Corps and the City have been procured. Sublessor shall join, but without expense to Sublessor, in the
application for such permits, licenses or authorizations whenever such action is necessary and is requested
by Sublessee;
(4) no alterations shall be made which would be in violation of the terms and provisions of the
Corps Lease or City Sublease;
(5) any alterations shall be made within a reasonable time and in a good and workmanlike
manner and in substantial compliance with all applicable permits, licenses and authorizations, and building
laws and with all other Governmental Regulations; and
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(6) Sublessee will upon demand by Sublessor give reasonably satisfactory proof or assurances
to Sublessor that the funds required to pay for such alterations are or will be available to Sublessee for such
purpose.
Section 10.3.Utilities. Sublessor is responsible, at its sole cost and expense, for obtaining and
installing all utility lines, connections and facilities to serve the overall Demised Premises, including but
not limited to delivering utility lines and connections to two (2) stubouts each located at the concrete pads
at the Top of the Flowage Easement near the Parking to serve the Marina Facilities in the location shown
on Exhibit "“B"” and as designated in the Sublessee Plans and Specifications and the Sublessor Plans and
Specifications ("(“Sublessor Utility Work").”). Sublessor and Sublessee acknowledge and agree that
Sublessor will use its best efforts to bring utilities to various locations in the Demised Premises in an effort
to minimize Tenant'sTenant’s costs related to extending and providing utilities to the Marina Facilities.
After substantial completion of the Sublessor Utility Work, Sublessor will deliver written notice to
Sublessee that the Sublessor Utility Work is substantially complete ("(“Notice of Substantial Completion
of Sublessor Utility Work").”). Upon receipt of the Notice of Substantial Completion of Sublessor Utility
Work and thereafter, Sublessee will be responsible for all costs for maintaining and repairing such utilities
for the Demised Premises to the extent they exclusively serve the Demised Premises ("(“Sublessee Utility
Work").”). Sublessor shall pay all charges for water, electricity, gas, sewer, telephone or any other utility
connections, tap-in fees and services related to the installation and construction of the Sublessor Utility
Work. From and after the Effective Date and until Sublessee'sSublessee’s receipt of the Notice of
Substantial Completion of Sublessor Utility Work, Sublessor shall provide to Sublessor and Sublessee all
utility services needed for the construction of the Sublessor Improvements and the Sublessee
Improvements. For such period prior to Sublessee'sSublessee’s receipt of the Notice of Substantial
Completion of Sublessor Utility Work and with respect to each party'sparty’s use of utilities during
construction, Sublessor and Sublessee agree to use reasonable efforts to monitor their respective uses of
utilities related to their respective construction obligations with the intent that the utility costs will be
divided between and paid for by Sublessor and Sublessee based on each party'sparty’s actual use and the
costs associated with such use. From and after Sublessee'sSublessee’s receipt of the Notice of Substantial
Completion of Sublessor Utility Work, Sublessee shall pay all charges for water, electricity, gas, sewer,
telephone or any other utility connections, tap-in fees and services furnished to the Demised Premises, or
if the utilities serve more than the Demised Premises then Sublessee shall only pay Sublessee'sSublessee’s
allocable share of the charges for water, electricity, gas, sewer, telephone or any other utility connections,
tap-in fees and services applicable to the Demised Premises. Sublessor shall in no event be liable or
responsible for any cessation or interruption in, or damage caused by, any such utility services; provided
however, upon substantial completion of the Sublessor Utility Work, Sublessor agrees to assign to
Sublessee any and all warranties from contractors under the construction contracts for the Sublessor Utility
Work.
Section 10.4.License to Use the Park Facilities. Sublessor reserves and retains an irrevocable
license to use the Park Facilities and Parking (excluding the Fuel Tank and Trash Dumpster Area) , and
sidewalks and vehicular access drives within the Park Area, with all such areas as depicted on Exhibit
"“D",”, in favor of Sublessor, the Association and the City for (a) general, daily use of the Park Facilities
and Parking by members of the Association and by the public and (b) special events that may be planned
by the Association or the City (with any costs for such an event to be paid by the Association or the City,
as applicable) subject to the conditions and requirements in this Section 10.4 (“Special Events”), which
license reserved herein shall continue until the expiration or earlier termination of this Sublease. Conditions
for Special Events include, but are not limited to:
(a) Sublessor will provide the requirements for scheduling a Special Event to the Association
and the City, including, but not limited to, providing Sublessee not less than ninety (90) days'days’ prior
written notice of the City and Association’s desire to host a Special Event;
(b) Sublessee to provide its approval which will not to be unreasonably withheld or delayed;
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(c) The planner of the Special Event (whether the Association or the City), at its sole cost,
shall obtain any required special event permits for City and Association Special Events;
(d) If required by the City, the planner of the Special Event (whether the Association or the
City) will annually obtain a Master Special Events Permit satisfying the requirements of the City’s Special
Events Guidelines to cover each of its Special Events to be held within the Park Area. If required by the
City, the planner of the Special Event (whether the Association or the City) will provide the City’s Tourism
& Culture Department with at least thirty (30) days'days’ prior written notice of its election to hold such
Special Event, along with the pertinent details relating to each proposed event, such as number of
participants, proposed uses, and times;
(e) Any proposed Special Event which contemplates (i) amplified sound, (ii) temporary
installation of structures requiring permits from agencies having jurisdiction, (iii) hours of operation which
extend beyond the hours of operation for the Park Area and Demised Premises, or (iv) dates for the proposed
Special Event that conflict with those high impact periods in which the City does not issue special event
permits (i.e., Spring Break) may require the approval of the City Manager; and
(f) Such other reasonable requirements as Sublessee’s deems necessary based on the type of
Special Event.
Section 10.5. Security. Sublessee, at its sole cost and expense, is responsible for providing any
security within the Demised Premises that will reasonably ensure the safety of employees and patrons.
Neither Sublessor nor Sublessee shall permit or allow the use of the Demised Premises in any manner that
violates applicable laws or regulations or constitutes a hazard to the health, safety and/or welfare of the
public.
ARTICLE XI.
CASUALTY DAMAGE, DESTRUCTION AND CONDEMNATION
Section 11.1.Casualty Damage or Destruction.
(1) Sublessee'sSublessee’s and Sublessor'sSublessor’s Obligation to Restore. If the
Sublessee Improvements or any other improvements constructed by Sublessee hereafter situated on the
Demised Premises during the term of this Sublease are wholly or partially destroyed or damaged by fire, or
any other casualty whatsoever, Sublessee shall promptly repair, replace, restore or reconstruct the same in
substantially the form in which the same existed prior to any such casualty and with at least as good
workmanship and quality as the Improvements being repaired or replaced, all in compliance with the
provisions of Article VI hereof but with such alterations or modification as to restored Improvements as
may be consistent with the further terms and provisions hereof. Such work shall commence on or before
one hundred eighty (180) days from the event giving rise to such construction obligation and shall be
completed thereafter with reasonable diligence. If, after the date of substantial completion of the Sublessor
Improvements and during the term of this Sublease, the Sublessor Improvements or any other improvements
constructed by Sublessor now or hereafter situated on the Demised Premises during the term of this
Sublease, are wholly or partially destroyed or damaged by fire, or any other casualty whatsoever, Sublessee
shall promptly repair, replace, restore or reconstruct the same in substantially the form in which the same
existed prior to any such casualty and with at least as good workmanship and quality as the Improvements
being repaired or replaced, all in compliance with the provisions of Article VI hereof but with such
alterations or modification as to restored Improvements as may be consistent with the further terms and
provisions hereof. Notwithstanding any provision in this Sublease to the contrary, (a) after the substantial
completion date of the Sublessor Improvements, Sublessee shall be entitled to and shall receive (subject to
subsection (2) below) all insurance proceeds received by Sublessee and Sublessor in connection with
damage and destruction of the Sublessor Improvements and the Demised Premises by fire or any other
casualty whatsoever; (b) at any time Sublessee is required under this Sublease to insure and replace the
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Sublessor Improvements, Sublessee shall be entitled to and shall receive (subject to subsection (2) below)
all insurance proceeds received by Sublessee and Sublessor in connection with damage and destruction of
the Sublessor Improvements and the Demised Premises by fire or any other casualty whatsoever; and (c)
prior to the substantial completion date of the Sublessor Improvements, Sublessee shall be entitled to
receive (subject to subsection (2) below) all insurance proceeds received by Sublessee in connection with
damage and destruction of the Sublessee'sSublessee’s Improvements by fire or any other casualty
whatsoever and Sublessor shall be entitled to receive all insurance proceeds received by Sublessor in
connection with damage and destruction of the Sublessor'sSublessor’s Improvements by fire or any other
casualty whatsoever. Subject to confirmation of available insurance proceeds, such work, if any, shall
commence on or before one hundred eighty (180) days from the event giving rise to such construction
obligation and shall be completed thereafter with reasonable diligence by Sublessee.
(2) Deposit of Funds for Restoration. So long as there exists a Leasehold Mortgage, all fire
and extended coverage insurance proceeds shall be deposited with the holder of such Leasehold Mortgage
having the first lien priority. If there is no Leasehold Mortgage, such proceeds shall be deposited with a
national bank in Dallas, Texas selected by Sublessee ("(“Qualified Bank").”). In any event such proceeds
shall be received, held and paid out by such Leasehold Mortgage, if any, or by such Qualified Bank, and
shall be disbursed for restoration for the casualty damage as follows unless modified by the Leasehold
Mortgage:
(A) Sublessee or Sublessor, as applicable based on the party being responsible for the
repairs and restoration and seeking disbursement of insurance proceeds, must first secure
Sublessor'sSublessor’s or Sublessee’s (as applicable), the Corps'Corps’, the City'sCity’s,
and any Leasehold Mortgagee'sMortgagee’s reasonable approval of the plans and
specifications for the proposed restorative work if such plans and specifications for
restoration deviate materially from the plans and specifications for the Improvements
which have been so damaged. The insurance proceeds will be paid to Sublessee or
Sublessor, as applicable, by the first lien Leasehold Mortgagee, if any, or disbursed by such
Qualified Bank, if any, after delivery of evidence satisfactory to such Leasehold
Mortgagee, if any, and to Sublessor and Sublessee, as applicable, that (1) such repair,
restoration or rebuilding has been completed and effected in compliance with this Sublease
as to quality, and (2) no mechanics'mechanics’ or materialmen'smaterialmen’s liens have
attached to the fee or leasehold estate; or at the option of Sublessee or Sublessor, as
applicable, such proceeds may be advanced by such Leasehold Mortgagee or disbursed by
such Qualified Bank in reasonable installments. Each such installment (except the final
installment) is to be advanced by such Leasehold Mortgagee, if any, or disbursed by such
Qualified Bank, if any, in an amount equal to the cost of construction of the work completed
(including Sublessee'sSublessee’s or Sublessor’s, as applicable, overhead directly related
or reasonably allocated thereto) since the last prior advance (or since commencement of
work, as to the first advance) according to a certificate (the "Architect's“Architect’s
Certificate")”) by the Sublessee'sSublessee’s or Sublessor’s architect, as applicable, in
charge, less statutorily required retainage in respect of mechanics'mechanics’ and
materialman'smaterialman’s liens, together with a reasonable showing of bills for labor and
material, and evidence satisfactory to any such Leasehold Mortgagee that no lien affidavit
has been filed in county for any labor-or material in connection with such work. Sublessee
or Sublessor, as applicable based on the party being responsible for the repairs and
restoration and seeking disbursement of insurance proceeds, shall deliver a copy of the
Architect'sArchitect’s Certificate and accompanying materials to the other party (whether
Sublessor or Sublessee) concurrently with the delivery of the Architect'sArchitect’s
Certificate and accompanying materials to the Leasehold Mortgagee or Qualified Bank, as
applicable. The final payment or disbursements, which shall be in an amount equal to the
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balance of such proceeds, shall then be made upon architect'sarchitect’s proper certificate
of completion (the "“Certificate of Completion")”) and upon receipt of evidence required
by (a) (1) and (a) (2) above, but in no event shall such Leasehold Mortgagee, if any, or
such Qualified Bank, if any, be required to advance more than the balance of such insurance
proceeds remaining on deposit with such disbursing agent. Sublessee or Sublessor, as
applicable based on the party being responsible for the repairs and restoration and seeking
disbursement of insurance proceeds, shall deliver a copy of the Certificate of Completion
and accompanying materials to the other party (whether Sublessor or Sublessee)
concurrently with the delivery of the Certificate of Completion and accompanying
materials to the Leasehold Mortgagee or Qualified Bank, as applicable;
(B) Should the cost of said repairs, restoration or rebuilding be estimated by
Sublessee'sSublessee’s or Sublessor’s architect, as applicable, in charge to be in excess of
said insurance proceeds or should the actual cost determined after Sublessee or Sublessor,
as applicable, has commenced restoration be in excess of said proceeds, Sublessee or
Sublessor, as applicable will upon demand by any such Leasehold Mortgagee give
satisfactory proof or assurances to such Leasehold Mortgagee that the funds required to
meet such deficiency are or will be available to Sublessee or Sublessor, as applicable, for
such purpose or will deposit the necessary funds to cover such deficiency with such
Leasehold Mortgagee;
(C) Any and all such insurance proceeds in excess of the cost of such repairs,
restoration or rebuilding may, if any Leasehold Mortgage so provides, be applied in
reduction of unpaid principal and other indebtedness due under such Leasehold Mortgage
in the order of priority of such Leasehold Mortgagees; provided, however, that no insurance
proceeds in excess of the cost of such repairs, restoration or rebuilding shall be applied to
reduce the amount of any Leasehold Mortgage unless the architect has delivered to
Sublessee or Sublessor, as applicable, a certificate to the effect that such repairs, restoration
or rebuilding have been completed substantially in accordance with plans and
specifications therefor and in such event and prior to substantial completion of the
Sublessor Improvements, only insurance proceeds received from Sublessor’s insurance
coverages may be applied to reduce the amount of any Leasehold Mortgage on Sublessor’s
interest and only insurance proceeds received from Sublessee’s insurance coverages may
be applied to reduce the amount of any Leasehold Mortgage on Sublessee’s interest. After
completion of the Sublessor Improvements, excess insurance proceeds may be applied to
reduce the amount of any Leasehold Mortgage on Sublessee’s interest. In the event that
there is no Leasehold Mortgage on Sublessee'sSublessee’s interest, or no Leasehold
Mortgagee elects to apply any such excess, the amount of excess shall be paid over to
Sublessee.
(3) No Abatement. In the event of any such casualty, the rental and other payments herein
provided for shall not be abated, and the happening of any such casualty shall not cause a termination of
this Sublease except as herein provided.
Section 11.2.Condemnation.
Section 11.2.(1). Total Taking. Sublessor and Sublessee agree that if the whole of either the
Marina Facilities or the Demised Premises is taken (which term when used in this Section 11.2 shall include
any conveyance in avoidance or settlement of condemnation or eminent domain proceedings) by the United
States, the Corps, the State of Texas, the City, or any other government or power whatsoever, or by any
corporation under the right of eminent or should the whole of said Marina Facilities or Demised Premises
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and improvements associated therewith are condemned by any court, city, state, county or governmental
authority or office, department or bureau of the city, county, state or United States, then this Sublease shall
terminate as of the date of taking of possession by the condemning authorities (or the later date on which
Sublessee receives its portion of the award) and the award will be distributed and payable to Sublessee.
Section 11.2.(2).Partial Taking. Sublessor and Sublessee agree that should the leasehold
estate be taken in part of either the Marina Facilities or Demised Premises by the United States, Corps, State
of Texas, the City, or any other government or power whatsoever, or by any corporation under the right of
eminent domain, or should a part of either of said Marina Facilities or Demised Premises be condemned by
any court, city, state, county or governmental authority or office, department or bureau of the city, county,
state or United States, then in such event this Sublease shall nevertheless continue in effect as to the
remainder of the Demised Premises unless in Sublessee'sSublessee’s commercially reasonable judgment so
much of the Demised Premises is so taken or condemned as to make it economically unsound to attempt to
use the remainder for the uses and purposes contemplated herein, in which latter event this Sublease shall
terminate upon notice of termination by the Sublessee to Sublessor, with such termination to be effective
as of the date of taking of possession by the condemning authority (or later date on which Sublessee receives
its portion of the award) in the same manner as if the whole of the Demised Premises had been thus taken
or condemned; provided, however, that if a Leasehold Mortgage then encumbers the Demised Premises
this Sublease shall not terminate without the prior written consent of the Leasehold Mortgagee. In the
event of such taking or condemnation of a portion of the Demised Premises where this Sublease is not
terminated thereby under the provisions of the first sentence of this Paragraph, the Rental payable during
the remainder of the term after taking of possession by said condemning authority shall be reduced on a
just and proportionate basis having due regard to the square footage of the portion of the Demised Premises
and the percentage of the wet slips thus taken or condemned as compared to the remainder thereof and
taking into consideration the extent, if any, to which Sublessee'sSublessee’s use of the remainder of the
Demised Premises shall be been impaired or interfered with by reason of such partial taking or
condemnation.
Section 11.2.(3).Award. In the event that a part of the Demised Premises and
Improvements be taken under the power of eminent domain, or by condemnation proceedings and this
Sublease is terminated by reason of such partial taking, and no work will have to be performed as a result
thereof, then the award will be distributed to Sublessee in accordance with Section 11.1. In the event that a
part of the Demised Premises and Improvements be taken under the power of eminent domain or by
condemnation proceedings and this Sublease is not terminated by reason of such partial taking, then the
condemnation award shall be paid to Sublessee to the extent the condemnation impairs the Sublessee
Improvements and to the Sublessor to the extent the condemnation impairs the Sublessor Improvements
(subject to Sublessee'sSublessee’s right to receive twenty-five percent (25%) of the Sublessor'sSublessor’s
award as a reimbursement for Sublessee'sSublessee’s contribution to the costs of Sublessor Improvements).
Section 11.2.(4).Rights of Leasehold Mortgagee. If any Leasehold Mortgagees
encumber the leasehold estate, the Leasehold Mortgagees shall, to the extent permitted by law, be made a
party to any condemnation proceeding, if any so desire.
Section 11.2.(5).Voluntary Dedication; Easement Grants. It is further understood,
however, that if during the term of this Sublease any portion of the Demised Premises (that is, with respect
to the leasehold interest therein) shall be voluntarily devoted to public use by Sublessee, it is expressly
agreed that there shall be no abatement of Annual Rental on account of said voluntary application to public
use, nor shall Sublessee thereby permit the public to acquire any right to or interest in any part of the
Demised Premises which will continue beyond the termination of this Sublease for any cause without the
Corps'Corps’, the City'sCity’s, and Sublessor'sSublessor’s prior written consent. Sublessor further
covenants and agrees that it will not undertake or consent to any change in the zoning applicable to the
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Demised Premises without Sublessee'sSublessee’s prior written consent. Any dedication of any portion of
the Demised Premises by plat or easement grant previously approved in connection with the Sublessor
Plans and Specifications and Sublessee Plans and Specifications of the Improvements to be constructed on
the Demised Premises, utilities or other purposes provided above shall not result in any reduction or
abatement of Annual Rental under this Sublease.
ARTICLE XII.
ASSIGNMENT, SUBLETTING AND MORTGAGE
Section 12.1.Assignment. Sublessee may assign any of its rights or obligations under this
Sublease to an Affiliate. Except for Approved Subleases (defined below) of space within the Demised
Premises, Leasehold Mortgages, boat slip licenses or leases to third parties desiring to lease a wet slip on
the Demised Premises ("(“Slip Licenses")”) , and subleases or assignments to an Affiliate (defined below)
(collectively Leasehold Mortgages, Slip Licenses, and subleases or assignments to an Affiliate shall
sometimes be referred to as "“Permitted Transfers"),”), Sublessee shall not sell, assign or otherwise
transfer any portion of its leasehold estate, or undivided interests therein, to any party, other than an Affiliate
of Sublessee, without the prior written consent of Sublessor, the City, and the Corps. As used in this
Sublease, "“Affiliate"” when used in reference to Sublessor or Sublessee shall refer to any person, firm,
corporation, partnership or other legal entity (for convenience herein called "“person")”) controlled by,
controlling or under common control with a party. Control as used in this definition means actual direction
or power to direct the affairs of the controlled person, and no person shall be deemed in control of another
simply by virtue of being a director, officer or holder of voting securities of any entity. A person shall be
presumed to control any partnership of which he or it is a general partner.
Section 12.2.Subleasing. Subleases of space within the Demised Premises that satisfy the
requirements of this Section 12.2 are "“Approved Subleases.".” Sublessee must deliver a copy of any
fully executed Approved Subleases to Sublessor, the City and the Corps.
(1) Approval. Except for Permitted Transfers, Sublessee shall not sublet all or any portion
of the Demised Premises for occupancy by any sub-sublessee without the prior written consent of
Sublessor, the City and the Corps.
(2) Sublease Terms. In addition to the other required provisions contained in this Sublease,
Sublessee'sSublessee’s sublease agreements shall include provisions that provide:
(A) that the sublease is subject to every provision of this Sublease, the City Sublease,
and the Corps Lease;
(B) that the sublease shall not be for a term extending beyond the term of this Sublease;
(C) that the sub-sublessee is responsible for complying with all Governmental
Regulations, and that sub-sublessee'ssublessee’s failure to cure after receiving notice of
non-compliance will result in Sublessee'sSublessee’s right to terminate the sublease;
(D) that the sub-sublessee is responsible for obtaining insurance identical to that
required of Sublessee as described in Section 9.1.
(3) Sub-Sublessee Attornment. If this Sublease terminates for any reason, including
Sublessee'sSublessee’s default, Sublessor shall accept the attornment by sub-sublessees in good standing
and paying fair market rentals under Approved Subleases. In no circumstance is Sublessor required to
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accept a sublease that (X) reduces rental payable to Sublessor or calls for the granting of concessions in
rent at any time, (Y) allows the prepayment of rent beyond the current month for which rent is due and
payable (except the prepayment of rental for the last month of the term of a sublease made to an actual
space occupant for the space to be occupied by him), or (Z) imposes on the Sublessor any obligation to
make alterations to the Demised Premises under the sublease or to reimburse sub-sublessee for alterations
made by the sub-sublessee.
Section 12.3.Continuing Obligations. Notwithstanding any assignment or subletting,
Sublessee shall at all times remain fully responsible and liable for the payment of the rent herein specified
and for compliance with all of its other obligations under this Sublease (even if future assignments and
sublettings occur subsequent to the assignment or subletting by Sublessee, and regardless of whether or not
Sublessor'sSublessor’s approval has been obtained for such future assignments and sublettings). Sublessor
shall be permitted to enforce the provisions of this Sublease against the undersigned Sublessee and/or any
assignee without demand upon or proceeding in any way against any other person. Sublessee shall
reimburse Sublessor for Sublessor'sSublessor’s reasonable expenses incurred by Sublessor in connection
with any request by Sublessee for assignment or subletting.
Section 12.4.Mortgage of Leasehold.
(a) Sublessee'sSublessee’s Rights. Sublessee may mortgage its leasehold estate, but
not Sublessor'sSublessor’s leasehold estate, the City'sCity’s leasehold estate, or the Corps fee
estate, in order to secure a mortgage loan to obtain funds to construct the Sublessee Improvements,
to fund the Infrastructure Contribution, for permanent loan funds used to retire interim construction
financing, to secure financings made to the direct or indirect owners of Sublessee, or for other
financing or refinancing directly benefiting the Demised Premises so long as the conditions
precedent set forth in Section 12.4.(d(e) are satisfied.
(b) Mortgagee'sLeasehold Mortgagee’s Obligations. If Sublessee permissibly
mortgages or encumbers its leasehold estate, the Leasehold Mortgagee shall in no event be required
to perform the obligations of Sublessee under this Sublease unless and until the Leasehold
Mortgagee becomes the owner of the leasehold estate pursuant to foreclosure, assignment in lieu
of foreclosure or otherwise; thereafter, the Leasehold Mortgagee shall remain subject to these
obligations only so long as the Leasehold Mortgagee remains the owner of the leasehold estate, and
in no event shall the obligations to be performed hereunder be more expansive for the Leasehold
Mortgagee than for Sublessee.
(c) Sublessee's Obligations.(c) Leasehold Mortgagee’s Rights Not Greater
than Sublessee’s. With the exception of the rights granted to Leasehold Mortgagees pursuant to
the express provisions of this Section 12.4, the execution and delivery of a mortgage, deed of trust
or Leasehold Mortgage shall not give nor shall be deemed to give a mortgagee, a beneficiary under
a deed of trust or a Leasehold Mortgagee any greater rights against Sublessor than those granted to
Sublessee hereunder.
(d) Sublessee’s Obligations. Notwithstanding the forgoing, it is specifically
understood and agreed that no mortgaging by Sublessee and/or any actions taken pursuant to the
terms of the Leasehold Mortgage shall ever eliminate or reduce Sublessee'sSublessee’s obligation
to pay the Annual Rental due hereunder and otherwise fully perform under this Sublease.
Sublessee shall give prompt notice to Sublessor of the terms of any Leasehold Mortgage.
Sublessee agrees to duly and timely perform all of its obligations under any such Leasehold
Mortgage.
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(de) Conditions Precedent. Sublessee agrees that, as a condition precedent to its right
to execute any Leasehold Mortgage, it shall:
(1) obtain the City'sCity’s prior written consent to any Leasehold Mortgage as
required in Section 9.01 of the City Sublease;
(2) furnish to Sublessor its loan documents entered into with the Leasehold
Mortgagee; and
(3) use commercially reasonable efforts to cause Leasehold Mortgagee to
enter into a tri-party agreement with Sublessor and Sublessee (provided that if Sublessee
uses commercially reasonable efforts to cause the Leasehold Mortgagee to include items
(A) and (B) below in the tri-party agreement and Leasehold Mortgagee refuses to include
items (A) and (B) such refusal alone shall not be deemed an event of default or a reason
for Sublessor to withhold consent to a mortgage encumbering Sublessee's leasehold
interest), among other things that:
(A) Leasehold Mortgagee will agree to (3) cause its Leasehold Mortgagee
to agree to the following:
(i) deliver a copy of any notice given by the Leasehold
Mortgagee to SublesseeSublessor pursuant to the Leasehold Mortgage at
the time that it is given to Sublessee (provided that if Leasehold Mortgagee
refuses to agree to this, Sublessee must deliver to Sublessor a copy of any
notices received from Leasehold Mortgagee promptly upon
Sublessee'sSublessee’s receipt); and
(B) Leasehold Mortgagee will agree to accept Sublessor's cure of any
default of Sublessee under the Leasehold Mortgage (Sublessor having no
obligation to do so) so long as Sublessor agrees to assume the obligations of
Sublessee under the Leasehold Mortgage and the note secured thereby;
(C) Leasehold Mortgagee's will agree to transfer, after the occurrence
of any event of default under the Leasehold Mortgage resulting in acceleration of
the indebtedness secured thereby and before foreclosure, if requested by Sublessor
(Sublessor being under no obligation to make such request), the Leasehold
Mortgage and the note secured thereby to Sublessor in consideration for the
payment by Sublessor to the Leasehold Mortgagee of the then outstanding
principal balance thereof and accrued but unpaid interest thereon, and all expenses
or other costs related thereto;
(D) Leasehold Mortgage(ii) Leasehold Mortgagee will agree
that there will be an ongoing covenant in the event the Leasehold
Mortgagee forecloses on the Leasehold Mortgage that the Demised
Premises shall continue to be operated in a first-class manner and
Sublessor shall have the unrestricted right to approve the replacement
operator of the Demised Premises and the Marina Facilities located
thereon;.
(E) If Sublessee's leasehold estate is encumbered by a Leasehold
Mortgage and written notice thereof has been given to Sublessor, Sublessor shall
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give to the holder of the Leasehold Mortgage (at the address or addresses specified
in the written notice to Sublessor for the giving of notices to the Leasehold
Mortgagee, or as otherwise specified by the Leasehold Mortgagee to Sublessee in
writing) written notice of any default hereunder by Sublessee, contemporaneously
with the giving of such notice to Sublessee. The holder of the Leasehold
Mortgage has the right to take any action or to make any payment necessary or
appropriate to cure the specified default, it being the intention of the parties hereto
that Sublessor shall not exercise Sublessor's right to terminate this Sublease
without first giving the Leasehold Mortgagee the notice provided for herein and
affording any Leasehold Mortgagee the same right to cure the default as provided
to Sublessee in Article XIV, below. Sublessor agrees not to exercise any right
that it may have to terminate this Sublease, so long as the Leasehold Mortgagee,
or its successor in interest, is performing all of Sublessee's covenants, duties and
obligations under this Sublease;
(F) So long as there are any unpaid or undischarged Leasehold
Mortgages on Sublessee's leasehold estate of which Sublessor has received written
notice, Sublessor expressly agrees for the benefit of the Leasehold Mortgagee(s)
that it will not accept from Sublessee a material modification of this Sublease, or
a voluntary surrender of the Demised Premises, without the written consent of the
Leasehold Mortgagee(s), which consent shall not be unreasonably withheld. This
provision does not limit Sublessor's rights in the event of default by Sublessee;
(G) Sublessor agrees that Sublessor will recognize the mortgagee and
its successors and assigns after foreclosure, or transfer in lieu of foreclosure, as
Sublessee hereunder, and continue to perform all of Sublessor's duties and
obligations hereunder so long as the mortgagee or its successors and assigns
performs all of the duties and obligations of Sublessee hereunder; and
(H) (f) Sublessor’s Obligations. Sublessor hereby agrees to the
following for the benefit of any Leasehold Mortgagee:
(1)Leasehold Mortgagee may realize on the security afforded by the
leasehold estate by exercising foreclosure proceedings or other remedies afforded at law or
in equity and acquire and succeed to the interest of Sublessee by virtue of the exercise of
any such remedies;
(2)If the Leasehold Mortgage is foreclosed upon by the Leasehold
Mortgagee, and the Demised Premises is acquired by such Leasehold Mortgagee or an
independent third party as the result of a foreclosure sale or conveyance in lieu of
foreclosure under said Leasehold Mortgage, Leasehold Mortgagee shall be permitted to
exercise any rights of Sublessee under the Sublease;
(3)All notices required to be given Sublessee pursuant to the terms of the
Sublease shall be given simultaneously to the Leasehold Mortgagee, so long as Sublessor
has been given written notice of its address, and no notice shall be effective against
Leasehold Mortgagee (and no grace period or cure period shall commence with respect to
Leasehold Mortgagee) until such notice has been given to Leasehold Mortgagee;
(4)All grace periods or rights to cure or remedy defaults held by Sublessee or
to which Sublessee is entitled by reason of any notice hereunder shall likewise be held by
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the Leasehold Mortgagee (provided that, so long as Leasehold Mortgagee has commenced
to cure the default and is proceeding with due diligence to cure the default, Leasehold
Mortgagee shall receive an additional thirty (30) days to cure any such defaults, and if such
default cannot reasonably be cured within a thirty (30) day period and Leasehold
Mortgagee is diligently proceeding to cure the default, Leasehold Mortgagee shall have
such additional time period to cure the default as may be reasonably required not to exceed
one hundred twenty (120) days);
(5)If the Demised Premises is acquired by such Leasehold Mortgagee or an
independent third party as the result of a foreclosure sale or conveyance in lieu of
foreclosure under said Leasehold Mortgage, Sublessor agrees not to terminate the Sublease
in connection with such foreclosure sale or conveyance in lieu thereof, provided that (A)
Leasehold Mortgagee or such third party prosecutes and completes such foreclosure or
other appropriate proceedings to acquire possession of and control over Sublessee’s
leasehold estate in the Sublease with reasonable diligence, (B) during the pendency of any
such foreclosure or other proceedings with respect to Sublessee’s interest in the Sublease,
Leasehold Mortgagee cures any defaults of Sublessee under this Sublease susceptible of
being cured by Leasehold Mortgagee without possession of the Demised Premises by the
Leasehold Mortgagee, and (C) upon Leasehold Mortgagee’s acquiring possession of the
Demised Premises, it expressly assumes Sublessee liabilities and obligations and privileges
under the Sublease and promptly commences to cure any default of Sublessee susceptible
of being cured by Leasehold Mortgagee after Leasehold Mortgagee obtains possession of
the Demised Premises;
(6)No substantive modification, amendment, waiver, release, termination or
other substantive change in the terms of the Sublease will be effective as to any Leasehold
Mortgagee without the prior written consent of the Leasehold Mortgagee;
(7)If the Sublease, without the consent of Leasehold Mortgagee, is terminated
for any reason (whether by reason of default of Sublessor or Sublessee, rejection of the
Sublease in any bankruptcy case, voluntary surrender and acceptance, or otherwise) prior
to its stated term, as the same may be extended, then Sublessor shall provide written notice
of such termination to Leasehold Mortgagee and, upon written request from Leasehold
Mortgagee made within thirty (30) days after such notification, enter into a new lease of
the Demised Premises with Leasehold Mortgagee subject to any approval rights held by
the City under the City Sublease or the Corps under the Corps Lease. The new lease shall
be effective as of the date of termination of the Sublease and be on the same terms and
conditions as the Sublease (including, without limitation, any rights or options to extend
the term of the Sublease) and shall not materially expand or reduce the rights or obligations
of the landlord or tenant thereunder.Leasehold Mortgagee and its nominee shall not be
liable for or otherwise be required to cure any defaults which are personal to Sublessee
(such as, for example, any default arising by virtue of any bankruptcy, insolvency or
dissolution of Sublessee). Sublessor’s obligation to enter into the new lease shall be
conditioned upon the following: (A) Leasehold Mortgagee shall have cured all defaults
under the Sublease that can be cured by the payment of money or performance of an action
and paid to Sublessor all Rent and other sums that would have been due and payable by
Sublessee under this Sublease but for such termination; and (B) Leasehold Mortgagee shall
reimburse Sublessor for all reasonable costs and expenses incurred in entering into the new
lease. To the extent practicable, such new lease shall have the same priority as this Sublease
as of the Effective Date; provided, however, that Sublessor shall not be deemed to have
represented or covenanted that such new lease shall be superior to encumbrances suffered
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or created by Sublessee, or claims of Sublessee, its other creditors or a judicially appointed
receiver or trustee for Sublessee;
(8)In any case commenced by or against Sublessor under Title 11 of the
United States Code (the “Bankruptcy Code”), if Sublessor elects to reject the Sublease
pursuant to the provisions of the Bankruptcy Code, the rejection will not terminate the
Sublease but will be treated only as a breach of the Sublease by the Sublessor. Sublessor
further agrees that in such a bankruptcy case Sublessee shall be deemed in possession of
the Demised Premises for purposes of Section 365(h) of the Bankruptcy Code, whether
Sublessee has retained actual occupancy and use, or has by sublease, assignment or license
permitted third parties to occupy and use portions of the Demised Premises; and as a result,
upon a rejection of the Sublease by Sublessor the Sublessee shall have the right to elect to
remain in possession of the Demised Premises under Section 365(h). Sublessor
acknowledges that Leasehold Mortgagee shall have a lien on any rights and interests
acquired or retained by Sublessee as a result of Sublessor’s rejection of the Sublease.
Sublessor acknowledges that Leasehold Mortgagee has in such bankruptcy case a power
of attorney or other right to act for and on behalf of Sublessee in relation to any proposed
rejection or assumption of the Sublease (but Leasehold Mortgagee shall not have any
obligations under the Sublease unless Leasehold Mortgagee expressly assumes the same);
(9)If more than one Leasehold Mortgagee has exercised any of the rights
afforded by this Section 12.4 hereof, only that Leasehold Mortgagee, to the exclusion of
all other Leasehold Mortgagees, whose Leasehold Mortgage is most senior in lien shall be
recognized by Sublessor as having exercised such right, unless such Leasehold Mortgagee
has designated a Leasehold Mortgagee whose Leasehold Mortgage is junior in lien to
exercise such right. If the parties shall not agree on which Leasehold Mortgage is prior in
lien, such dispute shall be determined by a title insurance company chosen by Sublessor,
and such determination shall conclusively bind the parties hereto and all Leasehold
Mortgagees; and
(1)(10)In addition, at Sublessee'sSublessee’s option, Sublessor will consent to the
following for the benefit of any Leasehold Mortgagee:
(i) an assignment of Sublessee'sSublessee’s share of the net
proceeds from any award or other compensation resulting from a total or
partial taking as set forth in Section 11.2 of this Sublease,
(ii) a collateral assignment of this Sublease, and
(iii) that, effective on a default in any Leasehold Mortgage, the
Leasehold Mortgagee may (A) foreclose the Leasehold Mortgage pursuant
to a power of sale by judicial proceedings or other lawful means and sell
the leasehold estate to the purchaser at the foreclosure sale, (B) appoint a
receiver, irrespective of whether any Leasehold Mortgagee accelerates the
maturity of all indebtedness secured by the Leasehold Mortgage, (C) enter
and take possession of the Demised Premises, manage and operate the
same, collect the subrentals, issues and profits therefrom and cure any
default under the Leasehold Mortgage or any default by Sublessee under
this Sublease, and (D) assign Sublessee'sSublessee’s right, title and
interest in and to the premiums for or dividends on any insurance required
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by the terms of this Sublease, as well as in all refunds or rebates of taxes
or assessments on or other charges against the Demised Premises, whether
paid or to be paid, provided that none of the foregoing shall be effective
with respect to Sublessor until notice of the existence of the Leasehold
Mortgage is delivered to Sublessor.
Section 12.5 Section 12.5 Non-Disturbance. In the event that Sublessor does not obtain,
at or prior to the Commencement Date, the release of the Demised Premises from any leasehold mortgage
granted by Sublessor which encumbers the Demised Premises, then Sublessor shall obtain non-disturbance
agreements with all lenders with a leasehold mortgage granted by Sublessor which encumbers the Demised
Premises, Sublessee, and Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the
parties. The encumbrance of the Demised Premises by any future leasehold mortgage granted by
Sublessor shall be conditioned upon Sublessor obtaining non-disturbance agreements with any such future
lenders, Sublessee, and Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the
parties, with such commercially reasonable modifications as may be requested by such future lenders. In
addition to the foregoing, Sublessor shall use commercially reasonable efforts to obtain non-disturbance
agreements in a form reasonably acceptable to Sublessee from the Corps and the City prior to the
Commencement Date of this Sublease.
Section 12.6 Sublessor Transfers and Mortgages.
(1) Sublessor may freely assign, transfer, sublet, hypothecate, pledge or mortgage
Sublessor'sSublessor’s interest under this Sublease or in the Demised Premises, subject to the terms and
provisions of this Sublease, without Sublessee'sincluding, without limitation, Section 12.6(3), without
Sublessee’s prior written consent.
(2) Sublessor will use commercially reasonable efforts to cause any lienholder
("Sublessor's(“Sublessor’s Lender")”) to whom Sublessor grants a deed of trust, mortgage, pledge, or lien
upon Sublessor'sSublessor’s interest in the Demised Premises or this Sublease ("Sublessor's(“Sublessor’s
Mortgage")”) to enter into an agreement among Sublessor, Sublessor'sSublessor’s Lender, Sublessee and
Sublessee'sSublessee’s Mortgagee that provides: (A) a copy of all notices to Sublessor of any default or
defaults of Sublessor under the applicable loan documents or in connection with such loan by
Sublessor'sSublessor’s Lender, including notice of acceleration of the maturity of the indebtedness, will be
given to Sublessee and Sublessee'sSublessee’s Mortgagee, (B) Sublessor'sSublessor’s Lender will accept a
cure by Sublessee or Sublessee'sSublessee’s Mortgagee of any default under such loan documents by
Sublessor, but that Sublessee and Sublessee'sSublessee’s Mortgagee will not be required to cure any such
default, (C) all payments so made and all things so done or performed by Sublessee or
Sublessee'sSublessee’s Mortgagee will be effective to prevent an acceleration of the maturity of the
indebtedness, the foreclosure of any liens securing payment thereof or the exercise of any other remedies
of Sublessor'sSublessor’s Lender upon default by Sublessor thereunder as the same would have been if
paid, done or performed by Sublessor instead of by Sublessee or Sublessee'sSublessee’s Mortgagee, and
(D) a right, but not an obligation, for Sublessee or Sublessee'sSublessee’s Mortgagee to purchase the
Sublessor'sSublessor’s Mortgage upon acceleration of the Sublessor Mortgage indebtedness after a default
by Sublessor that remains uncured after any applicable cure periods. Sublessee or Sublessee'sSublessee’s
Mortgagee will not be or become liable to any Sublessor'sSublessor’s Lender as a result of the right and
option to cure any such default or defaults by Sublessor.
(3) It shall be a condition precedent to Sublessor hypothecating, pledging or
mortgaging Sublessor’s interest under this Sublease or in the Demised Premises that Sublessor enter into a
subordination, non-disturbance, and attornment agreement with Sublessor’s Lender, Sublessee and
Sublessee’s Mortgagee, in form and substance reasonably acceptable to all of the parties.
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ARTICLE XIII.
MUTUAL INDEMNIFICATION
Section 13.1. Sublessee. From and after the Effective Date, Sublessee agrees to protect, defend
(with counsel reasonably acceptable to Sublessor), indemnify and hold harmless Sublessor from and against
any and all loss, cost, damage and liability and expense (including court costs and reasonable
attorneys'attorneys’ fees) arising from (i) the failure by Sublessee or any of its employees or sub-sublessees
to perform Sublessee'sSublessee’s duties and obligations under this Sublease in accordance with the terms
hereof, (ii) until the substantial completion date of the Sublessor Improvements, the negligence or
misconduct of Sublessee, Sublessee'sSublessee’s employees, sub-sublessees, servants, or invitees entering
the Demised Premises under express or implied invitation of Sublessee, (iii) the construction, installation,
repair or maintenance of the Sublessee Improvements and, after substantial completion, the repair and
maintenance of Sublessor Improvements conducted by Sublessee (excluding the construction, installation,
repair and maintenance of Sublessor Improvements which was and remains the responsibility of Sublessor),
or (iv) the operation of Sublessee'sSublessee’s business in the Demised Premises, and any other activities
on or about the Demised Premises, including without limitation, any claims, liabilities or damages relating
to products liability.
Section 13.2. Sublessor. From and after the Effective Date, Sublessor agrees to protect, defend
(with counsel reasonably acceptable to Sublessee), indemnify and hold harmless Sublessee from and against
any and all loss, cost, damage and liability and expense (including court costs and reasonable
attorneys'attorneys’ fees) arising from (i) the failure by Sublessor or any of its employees or contractor to
perform Sublessor'sSublessor’s duties and obligations under this Sublease in accordance with the terms
hereof, (ii) the negligence or misconduct of Sublessor, Sublessor'sSublessor’s employees, contractors, or
invitees entering the Demised Premises under express or implied invitation of Sublessor or Sublessor’s
license pursuant to Section 10.4, or (iii) any deficiencies or defects in the construction or installation of the
Sublessor Improvements from the substantial completion date of the Sublessor Improvements until the
expiration date of any warranties from contractors under the construction contracts for the Sublessor
Improvements.
Section 13.3.No Liability to Third Parties and Sub-Sublessees. In connection with its
management, operation, promotion and subleasing of the, Demised Premises, including, but not limited to
Sublessee'sSublessee’s business operations, Sublessee shall insert into each and every contract or sublease
it enters into a clause exculpating Sublessor from personal liability under the contract or lease and a clause
pursuant to which the third party/sub-sublessee agrees to indemnify and hold harmless Sublessor for the
matters set forth in Section 13.1.
ARTICLE XIV.
DEFAULT AND REMEDIES
Section 14.1.Default by Sublessee. Each of the following events is a "“Sublessee Event of
Default"” by Sublessee under this Sublease:
(1) Failure by Sublessee to pay any installment of rental or to pay or cause to be paid taxes (to
the extent Sublessee is obligated to pay same or cause same to be paid), utilities, insurance premiums or
other liquidated sums of money herein stipulated in this Sublease to be paid by Sublessee if such failure
shall continue for a period of five (5) business days after written notice ("(“Sublessee’s First Monetary
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Notice")”) thereof has been delivered to Sublessee (with a copy of said notice to any Leasehold Mortgagee
or trustee as provided by Article XII hereof).
(2) Failure by Sublessee to perform or observe any of the terms, covenants, conditions,
agreements and provisions of this Sublease (other than the payment of rent, taxes, utilities, insurance
premiums or other liquidated sums of money and other than the obligations to commence construction by
the date provided in Section 6.1) stipulated in this Sublease to be observed and performed by Sublessee if
such failure shall continue for a period of thirty (30) days after notice ("(“Sublessee’s First Non-Monetary
Notice")”) thereof has been delivered to Sublessee (with a copy of said notice to any Leasehold Mortgagee
or trustee as provided in Section 12Article XII hereof); provided, however, that if any such failure (other
than a failure involving payment of liquidated sums of money) cannot reasonably be cured within such
thirty (30) day period, then Sublessor shall not have the right to exercise Sublessor'sSublessor’s remedies
pursuant to Subparagraph (1) or (2) of Section 14.2 for so long as Sublessee proceeds in good faith and
with due diligence to remedy and correct any such failure, provided that Sublessee has commenced to cure
such failure after the effective date of such notice within such thirty (30) day period.
Section 14.2. Sublessor Remedies for Sublessee Default. If a Sublessee Event of Default occurs
hereunder, Sublessor may, at any time thereafter (i.e. after the period following the First Monetary Notice
or First Non-Monetary Notice provided for in Section 14.1) during the continuance of such Sublessee Event
of Default after giving a second ten (10) days'days’ written notice ("(“Second Notice")”) to Sublessee (with
a copy of said Second Notice to any Leasehold Mortgagee or trustee as provided in Article XII hereof), do
one or more of the following as Sublessor'sSublessor’s remedies for such Sublessee Event of Default:
(1) Subject to the provisions of Article XII hereof with respect to the rights of any Leasehold
Mortgagee, terminate this Sublease by giving Sublessee written notice of termination (with a copy of
said notice to any mortgageeLeasehold Mortgagee or trustee as provided in Article XII hereof), in
which event this Sublease and the leasehold estate created hereby and all interest of Sublessee and all
parties claiming by, through or under Sublessee shall automatically terminate upon the effective date
of such termination notice with the same force and effect and to the same extent as if the effective date
of such notice were the day originally fixed in Article I hereof for the expiration of the term of this
Sublease (provided, however, Sublessor may elect not to terminate the Slip Licenses), and Sublessor,
its agents or representatives, shall have the right, without further demand or notice, to reenter and take
possession of the Demised Premises (including all Improvements comprising part thereof) and remove
all persons and property therefrom with or without process of law, without being deemed guilty of any
manner of trespass and without prejudice to any remedies of Sublessor for past due rent or other sums
dues under the provisions hereof.
(2) Subject to the provisions of Article XII hereof with respect to the rights of any Leasehold
Mortgagee, terminate Sublessee'sSublessee’s right to possession of the Demised Premises and
enjoyment of the rents, issues and profits therefrom, without terminating this Sublease or the leasehold
estate created hereby, reenter and take possession of the Demised Premises (including all Sublessee
Improvements and other Improvements comprising part thereof) and remove all persons and property
therefrom, with or without process of law, without being deemed guilty of any manner of trespass and
without prejudice to any remedies for any breaches of covenants (including the payment of rent), then
existing or thereafter occurring, and lease, manage and operate the Demised Premises and collect the
rents, issues and profits therefrom, all for the account of Sublessee, and credit to the satisfaction of
Sublessee'sSublessee’s obligations hereunder the net rental this received (after deducting therefrom all
reasonable costs and expenses of repossessing, leasing, managing and operating the Demised
Premises). If the net rental so received by Sublessor exceeds the amounts necessary to satisfy all of
Sublessee'sSublessee’s obligations under this Sublease (including reasonable reserves for operations
and replacements), Sublessor shall be entitled to such excess. In the event Sublessor retakes
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possession of the Demised Premises under the foregoing provisions hereof, Sublessor shall not be
liable for any damages or injuries arising from its management and operation of the Demised Premises
unless caused by the negligence or misconduct of Sublessor, its agents or employees.
Notwithstanding the foregoing, in no event will Sublessor be required to deliver a Second Notice more than
one (1) time during a twelve (12) month period. If a second failure by Sublessee occurs during a twelve
(12) month period, Sublessor will only be required to deliver the first notice (whether a First Monetary
Notice or a First Non-Monetary Notice) and may then pursue its remedies set forth in Section 14.2 without
delivering a Second Notice.
The liability of Sublessee for the payment of rental and any other sums hereunder shall be
expressly subject to the further limitations and provisions of this Article XIV and Section 15.17 hereunder.
Section 14.3. Lien for Rent. In consideration of the mutual benefits arising under this
Sublease, Sublessee hereby grants to Sublessor a lien and security interest in all property of Sublessee
(including, but not limited to, all fixtures, machinery, equipment, furnishings, and other articles of personal
property now or hereafter placed in or on the Demised Premises by Sublessee, together with the proceeds
from the disposition of those items) (the "“Collateral"),”), now or hereafter placed in or upon the Demised
Premises, as security for payment of all rent and other sums agreed to be paid by Sublessee herein. The
provisions of this Section 14.3 constitute a security agreement under the Texas Uniform Commercial Code,
and Sublessor has and may enforce a security interest in the Collateral. The Collateral shall not be removed
without the consent of Sublessor until all arrearages in rent and other sums of money then due to Sublessor
hereunder have been paid and discharged. On or before the Commencement Date, Sublessee shall execute,
as Debtor, two or more Financing Statements, to perfect this security interest pursuant to the Texas Uniform
Commercial Code. Sublessor, as Secured Party, has all of the rights and remedies afforded a secured party
under the Texas Uniform Commercial Code in addition to and cumulative of the liens and rights provided
by law or by the other terms and provisions of this Sublease.
Section 14.4.Sublessor’s Remedies Cumulative. Pursuit of any one or more of the foregoing
remedies by Sublessor shall not preclude the simultaneous or subsequent pursuit of any other remedy
provided herein or any other remedy provided by law or in equity (including, but not limited to, the right
to seek actual damages or the right to seek specific performance), nor shall the pursuit of any one or more
remedies constitute a forfeiture or waiver of any rent or other amount payable by Sublessee hereunder or
of any damages accruing to or suffered by Sublessor by reason of any Sublessee Event of Default. NOT
WITHSTANDING ANY PROVISION IN THIS SUBLEASE TO THE CONTRARY, IN NO EVENT
SHALL SUBLESSEE BE LIABLE OR RESPONSIBLE FOR ANY CONSEQUENTIAL,
SPECULATIVE, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES UNLESS AND TO THE
EXTENT SUCH DAMAGES ARE PAYABLE UNDER THE CORPS LEASE OR CITY SUBLEASE
FOR SUCH DEFAULT.
Section 14.5 Default by Sublessor. Each of the following events is a “Sublessor Event of
Default” by Sublessor under this Sublease:
(1)Failure by Sublessor to pay or cause to be paid any monetary obligations due to Sublessee or any
other third party under this Sublease, taxes (to the extent Sublessor is obligated to pay same or
cause same to be paid), utilities, insurance premiums or other liquidated sums of money herein
stipulated in this Sublease to be paid by Sublessor if such failure shall continue for a period of five
(5) business days after written notice ("(“Sublessor’s First Monetary Notice")”) thereof has been
delivered to Sublessor (with a copy of said notice to any Sublessor'sSublessor’s Lender or trustee
as provided in Section 12.5 hereof).
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(2)Failure by Sublessor to perform or observe any of the terms, covenants, conditions, agreements and
provisions of this Sublease (other than the payment of monetary obligations, taxes, utilities,
insurance premiums or other liquidated sums of money and other than the obligations to commence
construction by the date provided in Section 6.1) stipulated in this Sublease to be observed and
performed by Sublessor if such failure shall continue for a period of thirty (30) days after notice
("(“Sublessor’s First Non-Monetary Notice")”) thereof has been delivered to Sublessor;
provided, however, that if any such failure (other than a failure involving payment of liquidated
sums of money) cannot reasonably be cured within such thirty (30) day period, then Sublessee shall
not have the right to exercise Sublessee'sSublessee’s remedies pursuant to subsection (1) or (2) of
Section 14.6 for so long as Sublessor proceeds in good faith and with due diligence to remedy and
correct any such failure, provided that Sublessor has commenced to cure such failure after the
effective date of such notice within such thirty (30) day period.
(3)Failure by Sublessor to perform or observe any of the terms, covenants, conditions, agreements and
provisions of the Corps Lease or the City Sublease (including the payment of monetary obligations,
taxes, utilities, insurance premiums or other liquidated sums of money) stipulated to be observed
and performed by Sublessor, subject to the applicable notice and cure periods, if any, set forth
therein.
Section 14.6 Sublessee Remedies for Sublessor Default. If a Sublessor Event of Default occurs
hereunder, except as expressly limited elsewhere in this Sublease, Sublessee may, at any time thereafter
(i.e. after the period following Sublessor’s First Monetary Notice or Sublessor First Non-Monetary Notice
provided for in Section 14.5) during the continuance of such Sublessor Event of Default after giving a
Second Notice to Sublessor, do one or more of the following as Sublessee'sSublessee’s remedies as
Sublessee'sSublessee’s sole remedies for such Sublessor Event of Default:
(1)Restrain or enjoin any breach or threatened breach of any covenant or obligation of Sublessor
contained within this Sublease without the necessity of proving the inadequacy of any legal
remedy or irreparable harm and without bond;
(2) Pursue an action for actual damages;
(3)Seek specific performance; or
(4)Perform Sublessor’s obligations whatever they may be, including but not limited to constructing
and completing Sublessor Improvements, and offset any and all costs and expenses (including an
Administrative Fee (as defined below), attorney and consultant fees, and court costs) incurred by
Sublessee (“Sublessee’s Costs”) against installments of Rental plus any and all other amounts
next coming due by Sublessee under this Sublease. In the event Sublessee performs Sublessor’s
obligations, including but not limited to constructing and completing Sublessor Improvements
under this subsection (4), Sublessee will, in its discretion, be entitled to receive an administrative
fee from Sublessor in an amount equal to four percent (4%) of Sublessee’s Costs (“Administrative
Fee”). Such Administrative Fee shall, in Sublessee’s discretion, be payable immediately to
Sublessee on demand or offset against installments of Rental or other amounts next coming due
by Sublessee under this Sublease or both.
Notwithstanding the foregoing, in no event will Sublessee be required to deliver a Second Notice more than
one (1) time during a twelve (12) month period. If a second failure by Sublessor occurs during a twelve
(12) month period, Sublessee will only be required to deliver the first notice (whether a Sublessor First
Monetary Notice or a Sublessor First Non-Monetary Notice) and may then pursue its remedies set forth in
this Section 14.6 without delivering a Second Notice. IN NO EVENT SHALL SUBLESSOR BE LIABLE
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OR RESPONSIBLE FOR ANY CONSEQUENTIAL, SPECULATIVE, INCIDENTAL, SPECIAL OR
PUNITIVE DAMAGES UNLESS AND TO THE EXTENT SUCH DAMAGES ARE PAYABLE UNDER
THE CORPS LEASE OR CITY SUBLEASE FOR SUCH DEFAULT.
Section 14.7.Sublessee’s Remedies Cumulative. Pursuit of any one or more of the foregoing
remedies by Sublessee shall not preclude the simultaneous or subsequent pursuit of any other remedy
provided herein), nor shall the pursuit of any one or more remedies set forth in this Lease constitute a
forfeiture or waiver of any amount payable by Sublessor hereunder or of any damages accruing to or
suffered by Sublessee by reason of any Sublessor Event of Default.
ARTICLE XV.
MISCELLANEOUS
Section 15.1. Rent on Net Return Basis. It is intended that the rent provided for in this
Sublease shall be a net return to Sublessor as provided herein, free of any expenses or charges with respect
to the Demised Premises, including, without limitation, maintenance, repairs, replacement, taxes and
assessments, and this Sublease shall be construed in accordance with and to effectuate this intention.
Section 15.2. Holding Over. If Sublessee, or any of Sublessee'sSublessee’s successors in
interest, fails to surrender the Demised Premises, or any part thereof, on the expiration of the term of this
Sublease (whether by lapse of time or otherwise), the holding over shall constitute a tenancy at-will,
terminable at any time by either Sublessor or Sublessee after thirty (30) days'days’ prior written notice to
the other, at a monthly rental equal to 150% of the rent paid for the month preceding the expiration of the
term of this Sublease. In the event of any unauthorized holding over, Sublessee agrees to indemnify
Sublessor and hold Sublessor harmless against any cost, liability or loss incurred by Sublessor as a result
of any such holding over by Sublessee.
Section 15.3. Waiver of Default. No waiver by the parties hereto of any default or breach of
any term, condition or covenant of this Sublease shall be deemed to be a waiver of any subsequent default
or breach of the same or any other term, condition or covenant contained herein.
Section 15.4. Attorneys'Attorneys’ Fees. In the event of any litigation between the parties
relating to this Sublease, the prevailing party shall be entitled to recover its reasonable attorneys'attorneys’
fees, expenses and costs and court costs as part of any judgment, award or settlement. The right to attorneys’
fees shall survive the expiration or earlier termination of this Sublease. For purposes of this Section 15.4,
a party will be considered to be the prevailing party if: (i) such party initiated the litigation and, as
determined by the court or arbitrator, substantially obtained the relief which it sought (whether by judgment,
voluntary agreement or action of the other party, trial or alternative dispute resolution process); (ii) such
party did not initiate the litigation and either (A) received a judgment in its favor, or (B) did not receive
judgment in its favor, but the party receiving the judgment did not substantially obtain the relief which it
sought, as determined by the court or arbitrator; or (iii) the other party to the litigation withdrew its claim
or action without having substantially received the relief which it was seeking as determined by the court
or arbitrator.
Section 15.5. Estoppel Certificates. Both parties hereto agree that from time to time, on
twenty (20) days'days’ prior written request, the non-requesting party will deliver to the requesting party a
statement in writing certifying as of the date of such statement:
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(1) if the facts permit, that this Sublease is unmodified and in full force and effect (or if there
have been modifications, that this Sublease as modified is in full force and effect and stating the
modifications);
(2) the dates to which rent and other charges have been paid; and
(3) to the non-requesting party'sparty’s knowledge that the requesting party is not in default
under any monetary obligation or other material term or provision of this Sublease, and if in default the
nature thereof in detail in accordance with an exhibit attached thereto.
(4) any other information reasonably requested by the requesting party or its mortgagee.
Section 15.6. No Partnership. It is understood and agreed that in leasing and operating the
Demised Premises, Sublessee is acting independently and is not acting as agent, partner, joint venturer or
employee of Sublessor.
Section 15.7.Survival. All of the terms, provisions, conditions, agreements and covenants
contained in this Sublease shall survive the expiration or termination of this Sublease with respect to all
rights and remedies that have accrued prior to or that accrue on the expiration or termination of this
Sublease.
Section 15.8. Exhibits. All exhibits, attachments, annexed instruments and addenda-referred
to herein shall be incorporated in this Sublease and considered a part of this Sublease for all purposes. The
parties acknowledge that the Exhibits may not be complete and final as of the Effective Date of this
Sublease. To the extent an Exhibit is not complete or final, then on or before the earlier of: (i) the date
Sublessor commences construction of the Sublessor Improvements; or (ii) the date Sublessee commences
construction of the Sublessee Improvements, Sublessor and Sublessee will attach the final version of each
and every Exhibit mutually agreed to in writing by Sublessor and Sublessee and to the extent required,
accepted and approved by the City and the Corps. Additionally, if and to the extent the City requires a
change by Sublessor to an Exhibit, then Sublessee'sSublessee’s consent is not required for such change as
long as such change does not prevent the use of the Demised Premises as a marina. Sublessor shall deliver
a copy of any such amended or substituted Exhibit to Sublessee within fifteen (15) Business Days of the
change, substitution or amendment.
Section 15.9. Use of Language. Words of any gender used herein shall be held and construed
to include any other gender, and words in the singular shall be held to include the plural, unless the context
otherwise requires.
Section 15.10. Captions. The captions or headings of paragraphs in this Sublease are inserted for
convenience only, and shall not be considered in construing the provisions hereof if any question of intent
should arise.
Section 15.11. Successors. The terms, conditions and covenants contained in this Sublease shall
apply to, inure to the benefit of, and be binding upon the parties hereto and their respective successors in
interest, and successor trustees, heirs, executors, administrators and legal representatives. All rights,
powers, privileges, immunities and duties of either party under this Sublease, including, but not limited to,
any notices required or permitted to be delivered by either party hereunder, may, at such party'sparty’s
option, be exercised or performed by such party'sparty’s agent or attorney.
Section 15.12. Severability. If any provision herein is held to be invalid or unenforceable, the
validity and enforceability of the remaining provisions of this Sublease shall not be affected thereby.
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Section 15.13. Notices. All notices which are required or permitted hereunder must be in writing
and shall be deemed to have been given, delivered or made, as the case may be (notwithstanding lack of
actual receipt by the addressee): (i) upon actual receipt or refusal by the addressee by hand; or (ii) three (3)
business days after having been deposited in the United States mail, certified, return receipt requested,
sufficient postage affixed and prepaid; or (iii) one (1) business day after having been deposited with an
expedited, overnight courier service (such as by way of example but not limitation, U.S. Express Mail,
Federal Express or Purolator), addressed to the party to whom notice is intended to be given at the address
set forth below:
Sublessor: Wynnwood Army, LLC
c/o Matthews Southwest
320 W Main Street
Lewisville, Texas 75057
Attn: Mr. Kristian Teleki
Telephone: (972) 221-1199
Email: kteleki@matthewssouthwest.com
With a Copy To: Koons Real Estate Law
1410 Robinson Road, Unit 100
Corinth, Texas 76210
Attn: Tiffany Sanford
Telephone: (214) 954-0067
Email: tsanford@koonsrealestatelaw.com
Sublessee: Argo SMI Tribute Marina SMI, LLC
17330 Preston Road, Suite 100C
Dallas, Texas 75252
Attention: Ron TenEyck
T: Attn: Chris Petty
Telephone: (972-) 789-1400
Email: rteneyck@suntexmarinascpetty@suntex.com
With a Copy To: Tribute Marina SMI, LLC
17330 Preston Road, Suite 100CSpencer Fane LLP
2200 Ross Avenue, Suite 4800 West
Dallas, Texas 7525275201
Attention: General Counsel
T: 214-865-7314
Attn: Brian DeVoss
Telephone: (214) 765-6423
Email: bdevoss@suntexspencerfane.com
And a Copy To: Bradley Arant Boult Cummings LLP
1445 Ross Avenue, Suite 3600
Dallas, Texas 75202
Attn: Sarah B. Fandrey
Telephone: (214) 257-9771
Email: sfandrey@bradley.com
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A party may change its notice address by delivering ten (10) days'days’ prior written notice to the other
party.
Section 15.14. Fees or Commissions. Each party hereby represents and warrants to the other,
that it has neither contacted nor entered into an agreement with any real estate broker, agent, finder, or any
other party in connection with this transaction, or taken any action that would result in any real estate
broker's, finder'sbroker’s, finder’s, or other fees or commissions being due or payable to any other party
with respect to the transaction contemplated by this Sublease. Each party hereby indemnities and agrees
to hold the other party harmless from any loss, liability, damage, cost, or expense (including reasonable
attorney'sattorney’s fees) resulting to the other party from a breach of the representation made by the
indemnifying party in this Section 15.14.
Section 15.15. Counterparts. This Sublease may be executed in multiple counterparts, each of
which shall be deemed an original, and all of which shall constitute one and the same instrument.
Section 15.16. Actions for Nonpayment of Rent and Other Charges. Sublessee shall not for
any reason withhold or reduce Sublessee'sSublessee’s required payments of rentals and other charges
provided in this Sublease, it being agreed that the obligations of Sublessor hereunder are independent of
Sublessee'sSublessee’s obligations, except as may be otherwise expressly provided.
Section 15.17. Limitation of Liability.
(a)Limitation of Sublessor'sSublessor’s Liability. Sublessee specifically
agrees to look solely to all of Sublessor'sSublessor’s interest in the Tribute Marina Park and
Sublessor Improvements for the recovery of any judgments against Sublessor. Sublessor (and
Sublessor'sSublessor’s shareholders, venturers, and partners, and their shareholders, venturers, and
partners, and all of their officers, directors, and employees) shall not be personally liable for any
such judgments.
(b)Limitation of Sublessee’s Liability. Sublessor specifically agrees to look solely
to all of Sublessee'sSublessee’s interest in the Demised Premises and Sublessee Improvements for
the recovery of any judgments against Sublessee. Sublessee (and Sublessee'sSublessee’s
shareholders, members, venturers, and partners, and their shareholders, members, venturers, and
partners, and all of their officers, directors, managers, and employees) shall not be personally liable
for any such judgments.
The limitation of liability contained in this Section 15.17 shall apply equally and inure to the benefit of the
party’s successors, and their respective present and future partners, members, beneficiaries, officers,
managers, directors, trustees, shareholders, agents, and employees, and their respective heirs, successors,
and assigns.
Section 15.18. Force Majeure. Whenever a period of time is herein prescribed for action to be
taken by Sublessor, Sublessor shall not be liable or responsible for, and there shall be excluded from the
computation of any such period of time, any delays due to Force Majeure.
Section 15.19. No Recording. The parties agree not to place this Sublease of record or any
memorandum of lease for this Sublease of record.
Section 15.20. Governing Law; Provisions Severable. The laws of the State in which the
Demised Premises are situated shall govern the interpretation, validity, performance and enforcement of
this Sublease. If any provision of this Sublease should be held to be invalid or unenforceable, the validity
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and enforceability of the remaining provisions of this Sublease shall not be affected thereby. Venue for
any action under this Sublease shall be the county in which the Demised Premises are located.
Section 15.21. Short Form Lease. The parties agree not to place this Sublease or record, but
each party shall, at the request of the other, execute and acknowledge so that the same may be recorded a
short form lease or memorandum of lease, stating that Sublessee has accepted possession of the Demised
Premises, indicating the lease term and any options to extend such term, but omitting rent and other terms,
and an agreement specifying the date of commencement and termination of the lease term; provided,
however, that the failure to record said short form lease, memorandum of lease or agreement shall not affect
or impair the validity and effectiveness of this Sublease. The party requesting such recording shall pay all
costs, taxes, fees and other expenses in connection with or prerequisite to recording.
Section 15.22. Interest on Late Payments. In the event any installment of Annual Rental or any
other sum payable by Sublessee to Sublessor under the provisions of this Sublease is not received by
Sublessor from Sublessee within five (5) days of the date it is due and payable, Sublessee shall pay to
Sublessor an additional sum (Late Charge) equal to five percent (5%) of the amount due. Furthermore, in
the event any installment of Annual Rental or any other sum payable by Sublessee to Sublessor under the
provisions of this Sublease is not received within ten (10) days after its due date for any reason whatsoever,
it is agreed that the amount thus due shall bear interest at the maximum contractual rate which legally could
be charged under the laws of the State in which the Demised Premises are situated in the event of a loan of
such rental or other sum to Sublessee (but in no event to exceed 1-1/2% per month), such interest to accrue
continuously on any unpaid balance due to Sublessor by Sublessee during the period commencing with the
aforesaid due date and terminating with the date on which Sublessee makes full payment of such amounts
to Sublessor. Any such interest shall be payable as additional rent hereunder and shall be payable
immediately on demand. In addition to any other charges permitted herein, if Sublessee makes a payment
to Sublessor by check and said check is returned to Sublessor by Sublessee'sSublessee’s bank marked NSF
(Not Sufficient Funds), "“Account Closed,",” or is dishonored for some similar reason, then an additional
charge of $25.00 per check shall be paid by Sublessee to Sublessor.
Section 15.23. AS IS/No Warranties/Covenants of Performance. It is expressly stipulated
and agreed that the Demised Premises shall be leased "“AS IS,",” in its present condition, and with all faults
and defects, whether known or unknown to either Sublessee or Sublessor, or both. Sublessee
acknowledges that its decision to lease the Demised Premises is based solely upon Sublessee'sSublessee’s
comprehensive inspection of the Demised Premises and not upon any warranty or representation of
Sublessor, or of Sublessor'sSublessor’s employees, agents, or representatives, with regard thereto. It is
expressly stipulated and agreed that none of the obligations to be undertaken hereunder by Sublessor shall
constitute any form of a warranty, express or implied, all such obligations being contractual covenants of
performance. Without limiting the generality of the foregoing, THERE IS NO WARRANTY, EXPRESS
OR IMPLIED, OF SUITABILITY, MERCHANTABILITY, HABITABILITY, OR FITNESS FOR ANY
PARTICULAR PURPOSE GIVEN IN CONNECTION WITH THIS SUBLEASE. The parties agree that
the herein provision disclaiming warranties, express and implied, and the provisions hereof under which
Sublessee assumes responsibility for repairs under Section 10.1 hereof, are provisions bargained for by the
parties in entering into this Sublease. The parties further agree that had warranties been undertaken by the
Sublessor hereunder or were the Sublessor to undertake to perform repairs beyond that contemplated
hereunder, the economics of this Sublease would have been affected and would have required an increase
in rent from that payable hereunder.
Section 15.24. Entire Agreement and Amendments. This Sublease embodies the entire
agreement between Sublessor and Sublessee and supersedes all prior agreements and understandings,
whether written or oral, and all contemporaneous oral agreements and understandings relating to the subject
matter hereof. Except as otherwise specifically provided herein, no agreement hereafter made shall be
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effective to change, modify, discharge or effect an abandonment of this Sublease, in whole or in part, unless
such agreement is in writing and signed by or on behalf of the party against whom enforcement of the
change, modification, discharge or abandonment is sought.
Section 15.25. Dispute Resolution. If a dispute arises with respect to this Sublease, the parties
to the dispute shall first attempt to resolve it through direct discussions in the spirit of mutual cooperation.
If the parties'parties’ attempts to resolve their disagreements through negotiation fail, the dispute shall be
mediated by a mutually acceptable third-party to be chosen by the disputing parties within thirty (30) days
after written notice by one of them demanding mediation. The disputing parties shall share the costs of
the mediation equally. By mutual agreement the parties may postpone mediation until each has completed
some specified but limited discovery about the dispute. By mutual agreement the parties may use another
nonbinding form of dispute resolution other than mediation. Any nonbinding dispute resolution process
conducted under the terms of this section shall be confidential within the meaning of Tex. Civ. Prac. and
Rem. Code Sec. 154.053 and 154.073. If neither a negotiated or mediated resolution is obtained within
the time periods provided by this section, the parties may pursue any available legal or equitable remedy.
Section 15.26. Bankruptcy or Insolvency. Sublessor and Sublessee agree that if Sublessee
becomes the subject of a bankruptcy proceeding under the Federal Bankruptcy Laws, as now enacted or
hereinafter amended, then "“adequate protection"” of Sublessor'sSublessor’s interest in the Demised
Premises pursuant to the provisions of Sections 361 and 363 (or their successor sections of the Bankruptcy
Code, 11 U.S.C. §101, et seq.) prior to the assumption and/or assignment of this Sublease by Sublessee
shall include, but not be limited to all (or any part) of the following:
(1) The continued payment by Sublessee of all rent and other sums due and owing under this
Sublease and the performance of all other covenants and obligations under this Sublease by
Sublessee; and
(2) The furnishing of a security deposit by Sublessee in the amount of three times the then-
current monthly Annual Rental payable hereunder.
Notwithstanding anything in this Sublease to the contrary, all amounts payable by Sublessee to or on
behalf of Sublessor under this Sublease, whether or not expressly denominated as "“rent,",” shall constitute
"“rent"” for the purposes of §502 (b) (7) of the U.S. Bankruptcy Code. If this Sublease is assigned to any
person or entity pursuant to the provisions of the Bankruptcy Code, any and all monies or other
considerations payable or otherwise to be delivered in connection with such assignment shall be paid and
delivered to Sublessor, shall be and remain the exclusive property of Sublessor and shall not constitute
property of Sublessee or the estate of Sublessee within the meaning of the U.S. Bankruptcy Code. Any
and all monies or other considerations constituting Sublessor'sSublessor’s property under the preceding
sentence not paid or delivered to Sublessor shall be held in trust by Sublessee for the benefit of Sublessor
and shall be promptly paid to or turned over to Sublessor.
[Signature Page Follows]
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EXECUTED as of the day, month, and year first above written.
Sublessor: Sublessee:
WYNNWOOD ARMY, LLC, Argo SMI Tribute MARINA SMI, LLC,
a Texas limited liability company a Delaware limited liability company
By: Wynnwood Army Management, Inc.,
a Texas corporation,By:
its sole manager
Its: Sole Manager
Name:
Title:
By: Title:
Name:
Title:
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Exhibit "“A"”
Metes and Bounds Legal Description of the Park Area
Being a parcel of land located in the City of the Colony, Denton County, Texas, a part of the B.B.B. &
C.R.R. Survey, Abstract 170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett
Survey, Abstract 751, and also being a part of that United States of America Remainder of Tract C-239A
recorded in Volume 384, Page 162, Deed Records Denton County, Texas, and being further described as
follows:
BEGINNING at a five-eighths inch iron rod with yellow cap stamped “CARTER BURGESS” found at the
northeast corner of that called 252.107 acre tract of land described in Memorandum of Lease Agreement
between Wynnwood Army, LLC and Wynnwood Peninsula Golf, LLC as recorded in Volume 4154, Page
1595, Deed Records Denton County, Texas, said point also being in the west line of Tract 3 called 107.317
acres as described in deed to Tribute Partners, L.P. as recorded in Document Number 2010-69114, Denton
County Deed Records;
THENCE along the north line of said 252.107 acre tract as follows:
South 88 degrees 36 minutes 12 seconds West, 511.84 feet to a five-eighths inch iron rod found for corner;
North 48 degrees 05 minutes 13 seconds West, 355.55 feet to a point for corner, said point being the
northwest corner of said 252.107 acre tract;
THENCE North 30 degrees 58 minutes 59 seconds East, 657.06 feet to a Corp of Engineers monument
found at the southwest corner of Tract 23 called 250.65 acres as described in deed to Tribute Partners, L.P.
as recorded in Document Number 2010-69110, Denton County Deed Records, said point also being in the
east line of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE along the south line of said Tract 23 as follows:
North 89 degrees 54 minutes 20 seconds East, 192.65 feet a Corp of Engineers monument found for corner;
North 87 degrees 58 minutes 59 seconds East, 238.88 feet to a one-half inch iron rod found for corner;
South 04 degrees 08 minutes 26 seconds East, 31.84 feet to a point for corner, said point also being the
northwest corner of Tract 21 called 23.486 acres as described in deed to Tribute Partners, L.P. as recorded
in Document Number 2010-69114, Denton County Deed Records;
THENCE along the west line of said Tract 21 as follows:
South 00 degrees 18 minutes 25 seconds East, 299.92 feet to a point for corner;
South 00 degrees 20 minutes 14 seconds East, 465.40 feet to the POINT OF BEGINNING and containing
491,064 square feet or 11.273 acres of land.
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164
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Exhibit "“A-1"”
Water Area
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Exhibit "“A-2"”
Future Building Parcel
BEING a parcel of land located in the City of the Colony, Denton County, Texas, a part of the B.B.B. &
C.R.R. Survey, Abstract 170, a part of the R.E. Carter Survey, Abstract 321, a part of the T.D. Luckett
Survey, Abstract 751, and also being a part of that United States of America Remainder of Tract C-239A
recorded in Volume 384, Page 162, Deed Records Denton County, Texas, and being further described as
follows:
BEGINNING at a Corp of Engineers monument found at the southwest corner of Lot 2, Block A, Beach
Club at Tribute, an addition to the City of The Colony recorded in Document Number 2020-64, Official
Public Records of Denton County, Texas, said point also being in the east line of Garza-Little Elm Dam
and Reservoir (Lake Lewisville);
THENCE along the south line of said Lot 2, Block A as follows:
North 89 degrees 55 minutes 28 seconds East, 192.54 feet to a Corp of Engineers monument found for
corner;
North 87 degrees 58 minutes 59 seconds East, 201.54 feet to a point for corner;
THENCE South 17 degrees 07 minutes 24 seconds West, 15.97 feet to a point for corner;
THENCE Southwesterly, 35.36 feet along a curve to the left having a central angle of 09 degrees 01 minutes
26 seconds, a radius of 224.50 feet, a tangent of 17.72 feet and whose chord bears South 12 degrees 36
minutes 41 seconds West, 35.32 feet to a point for corner;
THENCE South 89 degrees 55 minutes 30 seconds West, 121.78 feet to a point for corner;
THENCE Southwesterly, 222.99 feet along a curve to the left having a central angle of 89 degrees 39
minutes 25 seconds, a radius of 142.50 feet, a tangent of 141.65 feet and whose chord bears South 45
degrees 05 minutes 49 seconds West, 200.92 feet to a point for corner;
THENCE South 00 degrees 04 minutes 30 seconds East, 39.94 feet to a point for corner;
THENCE Southwesterly, 21.45 feet along a curve to the right having a central angle of 50 degrees 10
minutes 23 seconds, a radius of 24.50 feet, a tangent of 11.47 feet and whose chord bears South 25 degrees
00 minutes 41 seconds West, 20.78 feet to a point for corner;
THENCE Southwesterly, 50.01 feet along a curve to the left having a central angle of 43 degrees 44 minutes
32 seconds, a radius of 65.50 feet, a tangent of 26.29 feet and whose chord bears South 28 degrees 13
minutes 37 seconds West, 48.80 feet to a point for corner;
THENCE North 64 degrees 03 minutes 08 seconds West, 221.84 feet to a point for corner in the east line
of Garza-Little Elm Dam and Reservoir (Lake Lewisville);
THENCE North 30 degrees 58 minutes 59 seconds East, 221.13 feet along the east line of Garza-Little Elm
Dam and Reservoir (Lake Lewisville) to the POINT OF BEGINNING and containing 61,294 square feet
or 1.407 acres of land.
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167
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Exhibit "“B"”
Site Plan
168
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Exhibit "“C"”
Marina Facilities
169
170
13406\024\Tribute Sublease
Exhibit "“D"”
Design of Park Facilities
[Attached hereto]
171
172
173
174
Exhibit "“E"”
Drawing and Table of Parking
175
176
Exhibit "“F"”
Approved Sublessee Plans and Specifications for the Sublessee Improvements
Those certain plans approved in the City'sCity’s Ordinance No. 2022-2493, Site Plan – "“Tribute Lakeside
Park and Marina",”, a copy of which ordinance Sublessor and Sublessee received prior to the Effective Date
of this Sublease.
177
Exhibit "“G"”
Approved Sublessor Plans and Specifications for the Sublessor Improvements
Those certain plans approved in the City'sCity’s Ordinance No. 2022-2493, Site Plan – "“Tribute Lakeside
Park and Marina",”, a copy of which ordinance Sublessor and Sublessee received prior to the Effective Date
of this Sublease.
178
Exhibit "“H"”
USACE Marina Local Policies
That certain Policy Guidance for Outgrant Management – Administration of Areas Leased for Recreation
or Concession Purposes, Public or Private, Document No. CESWF-RE/CESWF-OD, Revised 15 July 2019,
prepared by Department of the Army, Fort Worth District, U.S. Army Corps of Engineers, P.O. Box 17300,
Fort Worth, Texas 76102-0300, which is 40 pages and a copy of which was delivered by Sublessor to
Sublessee prior to the Effective Date of this Sublease.
179
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Exhibit "“I.1"”
Shoreline Erosion Control Proposal
[Attached hereto]
180
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181
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Exhibit "“I.2"”
Sublessee Erosion Control Proposal
[Attached hereto]
184
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185
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186
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Exhibit "“J"”
Temporary Construction Access
[Attached hereto]
188
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CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE A GROUND SUBLEASE
AGREEMENT BETWEEN WYNWOOD ARMY, LLC AND ARGO SMI TRIBUTE, LLC
AND A CONSENT TO GROUND SUBLEASE AGREEMENT WITH NON-
DISTURBANCE AGREEMENT AMONG WYNNWOOD ARMY, LLC ARGO SMI
TRIBUTE, LLC AND THE CITY; AND PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to execute a Ground Sublease Agreement between Wynwood Army, LLC and Argo SMI
Tribute, LLC and a Consent to Ground Sublease Agreement and Non-Disturbance Agreement among
Wynwood Army, LLC, Argo SMI Tribute, LLC, and the City.
Section 2. That the City Manager is hereby authorized to execute said agreements.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
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Agenda Item No:6.5
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Calvin Lehmann
Submitting Department: Parks & Recreation
Item Type: Expenditures
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to execute a Professional Services Agreement
with MHS Planning and Design to provide services for an update to The Community Development and Parks
Master Plan in an amount not to exceed $63,600.00 to funded by the Community Development Corporation.
(Lehmann)
Suggested Action:
An Advisory Committee will be identified to assist in the development of the master plan and may include
members from the Parks Board, City Council, and CDC. This Committee may assist with:
1. Public engagement opportunities
2. Needs
3. Priorities
4. Recommendations
5. Implementation
The primary focus of this update will pertain to reinvesting in the existing infrastructure. The City is currently
working on the design of a new indoor recreation center in partnership with Huitt-Zollars. Five Star Complex is
now managed by a third party. Upgrades to The Colony Aquatic Park are proposed within the next few years.
Stewart Creek Park is currently being master planned.
Public Engagement Opportunities
1. Public engagement is anticipated to consist of one (1) public town hall meeting and one (1) community
survey.
2. Parkhill is currently working with the City to assess the conditions of the youth athletic fields. The MHS Team
will coordinate with Parkhill to concurrently conduct public engagement. Public engagement is anticipated to
occur in January.
Attachments:
The Colony Parks & Open Space Master Plan Update Proposal (11.01.2024).cleaned.pdf
Res. 2024-xxx MHS Planning.docx
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01 November 2024
Ms. Jackie Kopsa, Community Services Director
City of The Colony, Texas
5151 North Colony Boulevard
The Colony, Texas 75056
Via Email: jkopsa@thecolonytx.gov
RE: Letter Agreement between City of The Colony, Texas and MHS Planning & Design,
LLC for a Parks & Open Space Master Plan Update
Dear Jackie:
MHS Planning & Design is pleased to have the opportunity to submit this proposal for the
project referenced above. Based upon our understanding of the City’s desires for the Parks &
Open Space Master Plan Update, we have prepared the following scope of services for your
consideration:
I. Basic Services of the Consultant:
A. Service Area: The service area for the plan will be the corporate limits of The
Colony.
B. Time Frame: The Master Plan Update will cover a period of five (5) years.
C. Data Collection: 1. Obtain most recent maps and GIS data of the service area, including street maps,
topography maps, and aerial photography, if available. Photograph all parks, recreation
facilities and park sites in the service area. (See Section II for City’s responsibility.)
2. Obtain relevant planning documents and produce an updated inventory of parks,
recreation, and open space facilities within the service area.
3. Obtain the most recent population projections, demographic, and income data for the
service area.
4. Provide and distribute a public survey (online) regarding recreational opportunities, parks,
open spaces, and desires and compile results.
5. Meet with City staff to discuss previous accomplishments, future park projects, desires, and
programming needs regarding parks and public spaces.
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6. Coordinate with other Consultants working with the City (when needed) to gather other
planning documents, specifically the proposed Recreation Center.
D. Analysis of Supply and Demand: 1. Prepare updated Needs Analysis based on current and future supply and user
demand. This analysis will include a review of each park in the existing system and
will list recommended corrective actions, if any.
2. Conduct two (2) input workshops with special interest groups to further determine
recreational needs. (To be scheduled on the same day)
E. Preparation of Preliminary Master Plan 1. Document all existing parks and open spaces within The Colony Limits and develop
summary of achievements and accomplishments since 2019.
2. Identify park renovation projects, future land acquisition, and proposed facilities for
parks, open space, and recreation.
3. Prepare preliminary cost projections for park and recreation improvements
proposed for the five (5) year planning increment and prepare financing alternatives
for consideration.
4. Prepare draft written report detailing the Master Plan Update.
5. Hold an interim meeting with City Staff to review progress of planning, potential
parks and recommendations and establish priorities to be included in the update.
6. Present preliminary plan update to the Community Development Corporation and
City Council for comment.
7. Submit the draft plan update to Texas Parks and Wildlife for review and comment.
F. Preparation of Final Master Plan Update 1. Incorporate review comments and prepare final written report following TPWD
Guidelines, including previous achievements, amenity priorities, cost projections,
proposed phasing plan for park and recreation improvements, full color exhibits and
financing alternatives.
2. Develop a final master plan update that works in unison with other The Colony City-
Wide Plans and sets goals for the development of future projects.
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G. Presentation of Final Plan Update 1. Make presentation of the final Parks and Open Space Master Plan Update to the
Community Development Corporation and City Council for Adoption.
2. Present five (5) copies (reimbursable) and a PDF of the final bound plan update and
executive summary to the City. The Consultant will also deliver relevant AutoCAD,
ArcView/GIS and Word files to the City for their use.
H. Cost Containment: 1. In order to contain the cost of the plan, not more than five (5) trips to The Colony
will be made by the Consultant. The City and the Consultant will make all reasonable
efforts to group the scheduling of work tasks and meetings in order to take full
advantage of each trip. Virtual Meetings may be substituted for meetings outside of
City Council. II. The City’s Responsibilities:
The City of The Colony will:
A. Provide full information as to the requirements for the Project.
B. Provide to the Consultant all reasonably available information pertinent to the Project,
including a City base map in digital form, GIS data, topography, aerial photography, all
previous reports, including the reports listed in I.C.2, and any other data relative to
planning of the Project.
C. Make all provisions for the Consultant to enter upon public and private lands as required
for the Consultant to perform his work under this Agreement.
D. Examine all studies, reports, sketches, estimates, drawings, specifications, proposals, and
other documents presented by the Consultant and shall render in writing decisions
pertaining thereto within reasonable time so as not to delay the work of the Consultant.
This includes coordination with a third party.
E. Advertise for, coordinate, and arrange public meetings, board meetings, and focus group
meetings, and pay for all costs incident thereto.
F. Provide such legal, accounting, and insurance counseling services as may be required for
the Project.
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III. Additional Services
A. General: In addition to the basic services to be furnished by the Consultant under this
proposal for which the payment of the standard consulting fee shall be made, the
Consultant shall furnish additional services of the following types, if AUTHORIZED BY
THE OWNER IN WRITING.
1. Additional services due to significant changes in general scope of the project,
including, but not limited to, changes in size, complexity, or character when such
changes are requested by the Owner.
2. Revising, at Owner's request, studies, reports, design documents, drawings or
specifications which were previously approved by the Owner except the Owner shall
not be obliged to pay when:
a. The changes are required by regulating authorities or to bring the plan into
compliance with applicable codes, ordinances, or standards, or
b. The changes are required as a result of some error or omission on the part of the
Consultant.
B. Furnishing of additional copies of reports and additional prints of drawings.
C. Additional services and costs necessitated by out-of-town travel required by the
Consultant other than visits to the Project and consultation in the Owner's office as
required by Section I.
D. Serving as expert witness or giving counsel for the Owner in any litigation, real or
potential, or other legal proceeding involving the Project where the Consultant is not a
party to the litigation.
E. Additional services in connection with the Project not otherwise provided for in this
agreement.
F. Preparation of boundary survey, wetland delineation survey, lake permitting, flood
studies, geotechnical investigations, plats, legal descriptions or deeds, record searches,
abstracting of ownership, or other related surveyor work.
IV. Fees
A. The total fee for the work outlined in Section I will be $58,600 not including
reimbursable expenses such as travel & reproduction of five (5) copies of the plan and
the executive summary. Reimbursable expenses not to exceed $5,000.
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V. Billing A. Billing shall be monthly based on the actual work completed. Invoices will be submitted
to the City of The Colony and shall be due upon receipt. MHS Planning & Design reserves
the right to charge the amount of interest allowable under the current laws of the State
of Texas on any invoices not paid within thirty (30) days.
VI. General Conditions
A. Termination: This Agreement may be terminated by either party by giving ten (10) days
written notice in the event of substantial failure to perform in accordance with the terms
hereof by one party through no fault of the other party. If this Agreement is so
terminated the Consultant shall be paid for work completed plus reimbursable expenses.
Reimbursable expenses include actual expense for subcontracted services,
transportation, and subsistence of personnel when traveling in connection with the
Project; reproduction of reports, drawings, specifications, and similar Project related
items.
B. Estimates: Since the Consultant has no control over the cost of labor and materials or
other competitive bidding and market conditions, the estimates of construction are to be
made on the basis of his experience. However, the Consultant does not guarantee the
accuracy of such estimates as compared to the Contractor's bid or the final contract cost.
C. LIMITED LIABILITY: THE LIMIT OF LIABILITY OF THE CONSULTANT FOR THIS PROJECT
SHALL NOT EXCEED THE TOTAL COMPENSATION OUTLINED IN SECTION IV OF THIS
CONTRACT.
D. Successors and Assigns: The Owner and the Consultant each binds himself and his
officers, successors, executors, administrators and assigns to the other party of this
Agreement in respect to all covenants of this Agreement; except as above, neither the
Owner nor the Consultant shall assign, or transfer his interest in this Agreement without
the written consent of the other. Nothing herein shall be construed as creating any
personal liability on the part of any office or agent of any public body which may be a part
hereto.
E. Findings Confidential: All reports, information, and data prepared or assembled by the
Consultant under this contract are confidential and the Consultant agrees that they shall
not be made available to any individual or organization without the prior written
approval of the Owner.
F. Interest of Members of City: No member of the governing body of the City, and no
officer, employee, or agent of the City who exercises any functions or responsibilities in
connection with the planning and carrying out of the program, shall have any personal
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financial interest, direct or indirect, in this contract; and the Consultant shall take
appropriate steps to assure compliance.
G. Interest in Other Local Public Officials: No member of the governing body of the locality
and no other public official of such locality, who exercises any functions or responsibilities
in connection with the planning and carrying out of the program, shall have any personal
financial interest, direct or indirect, in this contract; and the Consultant shall take
appropriate steps to assure compliance.
H. Interest of Consultant and Employees: The Consultant covenants that he presently has
no interest and shall not acquire interest, direct or indirect, in the study area or any
parcels therein or any other interest which would conflict in any manner or degree with
the performance of his services hereunder. The Consultant further covenants that in the
performance of this contract, no person having any such interest shall be employed.
I. Personnel: The Consultant represents that he has, or will secure at his own expense, all
licensed personnel required in performing the services under this contract.
I. Project Hold Fee: If the Project is placed on hold by the City for longer than one month for
reasons outside MHS control, such as but not limited to Staff Review Periods, Lack of
Quorums, Council or Board Delays, etc, the City shall pay MHS a Project Hold Fee in the
sum of one percent (1%) of the total contract for each calendar month (30-day period)
beyond the date of MHS substantial completion of its obligations under this Contract.
If you find this proposal meets your needs, please sign below, retain one copy for your file and return
one to us. Once we receive the signed proposal, we will begin work. If you have any questions or
need us to modify our proposal, please let me know.
Sincerely,
Hunter N. Rush
Senior Planner & Partner
________________________________
Accepted & Approved
_____________
Date
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THE COLONY PARKS & OPEN SPACE MASTER PLAN UPDATE PROCESS
PROJECT MANAGEMENT & PLANNING STRUCTURE
– Client coordination, scheduling, and general overview of plan development
– Master Plan Update Process Overview with City Staff
– Park Classification System and Level of Service Introduction
– Master Plan Update timeframe (5 years)
DATA COLLECTION
– Obtain Current Aerial Photography
– Obtain Relevant City/County GIS Data
– Obtain FEMA Maps
– Obtain previous parks and recreation achievements from 2019 to present
– Inventory, Walk & Photograph Existing Parks
– Inventory, Walk & Photograph Natural Resources
– Obtain Current Population & Projected Population
PUBLIC ENGAGEMENT
– Develop Citizens Survey
– Conduct two (2) Focus Group Meetings
PLAN UPDATE PRODUCTION
Executive Summary
Goals & Objectives
– Review & Update Goals for Parks & Open Space if needed
– Review & Update Objectives if needed
– Establish Targeted Level of Service
– Identify Active/Passive Recreational Needs
Map Development
– Update Existing Parks - Service Area Map
– Update Future Park Projects Map
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Project Findings
– Establish Needs
– Establish Recommendations
– Establish Priority Listing of Facilities & Projects
– Develop Implementation Schedule with Funding Sources
Plan Standards
– Descriptive Narrative
– Color Photos
– Illustrations to Convey Concepts
– Meet All Requirements for Texas Parks & Wildlife Approval
REVIEW PERIOD
– Staff Review
– Community Development Corporation Review
– City Council Review
– MHS Internal Review & Copy Edit
– Citizen Review
– Texas Parks & Wildlife Review
FINAL PLAN & PLAN ADOPTION
– City Council Presentation
– Community Development Corporation Presentation
TRAVEL & REPRODUCTION EXPENSES
– Mileage @ $ .67/mile
– Reproduction @ cost + 15%
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CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES
AGREEMENT WITH MHS PLANNING AND DESIGN TO PROVIDE SERVICES FOR
AN UPDATE TO THE COMMUNITY DEVELOPMENT AND PARKS MASTER PLAN;
AND PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to execute a Professional Services Agreement with MHS Planning and Design to provide
services for an update to The Community Development and Parks Master Plan in an amount not to
exceed $63,600 to be funded by the Community Development Corporation.
Section 2. That the City Manager is hereby authorized to execute said agreement.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
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Agenda Item No:6.6
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Tina Stewart
Submitting Department: Public Works/Water Distribution
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authoring the City Manager to execute two contract amendments with Utility
Services CO., INC. to spread payments of the Monocle Residual Control Systems for Budget years 2024, 2025
and 2026. (Whitt)
Suggested Action:
In June of 2022, the city entered into 2 agreements for residual chlorine services at 2 of its storage tanks.
Initially, the contract has a large lump sum payment in year 1, a smaller payment in year 2 and annual
operations payments after the cost of the equipment was paid. The city preferred to make smaller annual
payments and Utility Service Co. has reworked the agreement to accommodate our current situation.
The new contract amendment defers that lump sum payment over the course of multiple years. These contract
amendments memorialize the new payment schedule. this change will result in a minor reduction in overall cost
but an additional $94k per agreement this year. The funds will be taken from the water improvement CIP and
will utilize the remaining funding that line.
All funds for this item are budgeted.
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Total
Original $500,000 $152,534 $152,534 $11,572 $11,572 $11,572 $839,784
Amended $100,000 $152,534 $247,466 $152,534 $152,534 $12,406 $817,474
Attachments:
Utility Service Co. Inc. Scope of Work No. 1.pdf
Amendment No. 1 to SOW1 - City of The Colony TX 10.29.2024.cleaned.pdf
Utility Service Co. Inc. Scope of Work No. 2.pdf
Amendment No. 1 to SOW2 - City of The Colony TX 10.29.2024.cleaned.pdf
Res. 2024-xxx Utility Services Co.docx
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Page 1 of 2
AMENDMENT NO. 1 TO SCOPE OF WORK NO. 1
TO THE MASTER SERVICES AGREEMENT
BETWEEN
UTILITY SERVICE CO., INC. AND
CITY OF THE COLONY, TX
MONOCLOR RESIDUAL CONTROL SYSTEM
INSTALLATION & MAINTENANCE – 500,000 GALLON CLOVER VALLEY EST TANK
1. Effective Date. The Effective Date for this Amendment No. 1 to Scope of Work No. 1
shall be November ____, 2024.
2. Modification of Section 2. Term. Section 2. Term shall be modified to add one (1) year
to the term, extending the term of SOW1 through June 29, 2033.
3. Modification of Section 6. Contract Price/Annual Fees. Section 6. Contract
Price/Annual Fees shall be removed and replaced with the following:
The annual fee for Contract Year 1 shall be $100,000.00. The annual fee for Contract
Year 2 shall be $152,534.00. The annual fee for Contract Year 3 shall be $247,466.00.
The annual fee for Contract Years 4 and 5 shall be $152,354.00. The annual fee for
Contract Year 6 shall be $12,406.00. Each anniversary thereafter, the annual fee shall be
adjusted to reflect the current cost of service. The adjustment of the annual fee shall be
limited to a maximum of 5% annually. All applicable taxes are the responsibility of the
Owner and are in addition to the stated costs and fees in this SOW1.
Invoice Nos. 607880 and 607881 shall be reversed as a part of this realignment of fees.
4. Modification of Section 7. Payment Terms. Section 7. Payment Terms. shall be
removed and replaced with the following:
The Company acknowledges that the fee for Contract Years 1 and 2 have been paid in
full. The Company has received $152,534.00 toward the Contract Year 3 payment. The
balance of $94,932.00 is due and payable before November 30, 2024. Each subsequent
annual fee, plus all applicable taxes, shall be due and payable on the first day of each
Contract Year thereafter. The parties agree that the Owner is tax exempt at the time of
execution of this SOW1, and therefore will not be charged taxes unless there is a change
in tax regulation during the term. In the event sufficient funds shall not be appropriated
for the payment of the charges required to be paid in subsequent municipal fiscal years,
then the Owner may terminate this SOW1 at the end of the ten current fiscal year, and the
Owner shall not be obligated to make any remaining payments provided for in this SOW1,
except, however, if the Owner elects to terminate this Contract prior to remitting the first
five (5) annual fees, then the balance for work completed shall be due and payable within
thirty (30) days of the termination.
5. Ratification of Original Contract. Except as expressly amended and modified herein,
the parties do hereby ratify and affirm the Master Services Agreement and Scope of Work
No. 1 and acknowledge their binding effect upon the parties.
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Page 2 of 2
6.Authorization to Execute. The signatories below certify that they are duly authorized to
execute this Amendment No. 1 to Scope of Work No. 1 on behalf of the entities
represented.
IN WITNESS WHEREOF, the Parties have executed this Amendment No. 1 to Scope of
Work No. 1 effective the day and year first above written.
OWNER COMPANY
City of The Colony Utility Service Co., Inc.
By:______________________________ By:_________________________________
Name:___________________________ Name:_____Jonathan Cato_____________
Title:____________________________ Title:_____Chief Operating Officer________
Date:____________________________ Date:_____October 29, 2024____________
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Page 1 of 2
AMENDMENT NO. 1 TO SCOPE OF WORK NO. 2
TO THE MASTER SERVICES AGREEMENT
BETWEEN
UTILITY SERVICE CO., INC. AND
CITY OF THE COLONY, TX
MONOCLOR RESIDUAL CONTROL SYSTEM
INSTALLATION & MAINTENANCE – 500,000 GALLON NORTH COLONY EST TANK
1. Effective Date. The Effective Date for this Amendment No. 1 to Scope of Work No. 2
shall be November ____, 2024.
2. Modification of Section 2. Term. Section 2. Term shall be modified to add one (1) year
to the term, extending the term of SOW2 through June 29, 2033.
3. Modification of Section 6. Contract Price/Annual Fees. Section 6. Contract
Price/Annual Fees shall be removed and replaced with the following:
The annual fee for Contract Year 1 shall be $100,000.00. The annual fee for Contract
Year 2 shall be $152,534.00. The annual fee for Contract Year 3 shall be $247,466.00.
The annual fee for Contract Years 4 and 5 shall be $152,354.00. The annual fee for
Contract Year 6 shall be $12,406.00. Each anniversary thereafter, the annual fee shall be
adjusted to reflect the current cost of service. The adjustment of the annual fee shall be
limited to a maximum of 5% annually. All applicable taxes are the responsibility of the
Owner and are in addition to the stated costs and fees in this SOW2.
The $400,000.00 scheduled to be billed on December 31, 2024 will not be billed as a part
of this realignment of fees.
4. Modification of Section 7. Payment Terms. Section 7. Payment Terms. shall be
removed and replaced with the following:
The Company acknowledges that the fee for Contract Years 1 and 2 have been paid in
full. The Company has received $152,534.00 toward the Contract Year 3 payment. The
balance of $94,932.00 is due and payable before November 30, 2024. Each subsequent
annual fee, plus all applicable taxes, shall be due and payable on the first day of each
Contract Year thereafter. The parties agree that the Owner is tax exempt at the time of
execution of this SOW2, and therefore will not be charged taxes unless there is a change
in tax regulation during the term. In the event sufficient funds shall not be appropriated
for the payment of the charges required to be paid in subsequent municipal fiscal years,
then the Owner may terminate this SOW2 at the end of the ten current fiscal year, and the
Owner shall not be obligated to make any remaining payments provided for in this SOW2,
except, however, if the Owner elects to terminate this Contract prior to remitting the first
five (5) annual fees, then the balance for work completed shall be due and payable within
thirty (30) days of the termination.
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Page 2 of 2
5.Ratification of Original Contract. Except as expressly amended and modified herein,
the parties do hereby ratify and affirm the Master Services Agreement and Scope of Work
No. 2 and acknowledge their binding effect upon the parties.
6.Authorization to Execute. The signatories below certify that they are duly authorized to
execute this Amendment No. 1 to Scope of Work No. 2 on behalf of the entities
represented.
IN WITNESS WHEREOF, the Parties have executed this Amendment No. 1 to Scope of
Work No. 2 effective the day and year first above written.
OWNER COMPANY
City of The Colony Utility Service Co., Inc.
By:______________________________ By:_________________________________
Name:___________________________ Name:__Jonathan Cato________________
Title:____________________________ Title:___Chief Operating Officer _________
Date:____________________________ Date:____October 29, 2024_____________
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CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE TWO (2) CONTRACT
AMENDMENTS WITH UTILITY SERVICES CO., INC. TO SPREAD PAYMENTS OF
THE MONOCLE RESIDUAL CONTROL SYSTEMS FOR BUDGET YEARS 2024, 2025
AND 2026; AND PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to execute two (2) contract amendments with Utility Services Co., Inc. to spread payments
of the Monocle Residual Control Systems in the amount of $189,864.00 for Budget Year 2024;
$305,068.00 for Budget Year 2025 and $305,068.00 for Budget Year 2026.
Section 2. That the City Manager is hereby authorized to execute said amendments.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
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Agenda Item No:6.7
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Robert Kotasek
Submitting Department: Engineering
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to execute a Construction Services Contract
Amendment No. 2 in the amount of $111,307.30 with KIK Underground, LLC for the Phase 13 Residential Street
Reconstruction Project. (Hartline)
Suggested Action:
Background:
The KIK Underground, LLC Construction Services Contract for the Phase 13 Street Reconstruction project was
approved by City Council on April 16, 2024 at a cost of $4,591,662.95. The set of concrete residential streets to
be constructed under this project are listed below.
Gates Drive – Paige Road to Baker Drive
Mayes Drive – Strickland Avenue to Pemberton Lane
Pemberton Lane – Blair Oaks Drive to Mayes Drive
During construction on Gates Drive, a resident notified the Engineering Department that a short section of
Matson Drive was in disrepair and asked if it could be reconstructed with the Gates Drive project. Engineering
reviewed the pavement on Matson Drive between Gates Drive and the nearest connecting alley and determined
it is in very poor condition and also does not drain well. The addition of this work will allow the storm water to
drain properly in this area and also to improve the existing roadway driving conditions. This short section of
Matson Drive (approx. 280 feet) will need to be reconstructed to the same width as existing with new 6-inch flex
base subgrade and new 6-inch reinforced concrete pavement. After our review, we are recommending this
short section of Matson Drive be added and reconstructed with the Phase 13 Street Reconstruction project.
The remainder of Matson Dr. is in very good condition.
The total cost of Contract Amendment No. 2 is $111,307.30 and City Staff recommends approval. The
Construction Services Contract Amendment No. 2 and photos of the existing conditions of Matson Drive are
attached for review. The construction on Gates Drive is ongoing and with approval of this Contract Amendment
No. 2, the new estimated completion of the Phase 13 Street Reconstruction project is in November 2025.
Attachments:
Location Map
Contract Amendment No. 2
Matson Drive Existing Conditions Photos
Financial Summary
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Res. 2024-xxx KIK Underground.docx
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µLocation MapMatson Drive for Contract Amendment No. 2Phase 13 Street Reconstruction Project
Matson Drive:
From the intersection of Gates Drive/Matson Road
to the first alley south of this intersection
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Matson Drive Existing Conditions Photo
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Matson Drive Existing Conditions Photo
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Matson Drive Existing Conditions Photo
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FINANCIAL SUMMARY:
Are budgeted funds available: Yes
Amount budgeted/available: $5,200,000.00 (Engineering/Construction)
Source of Funds: 895-669-6670 Project Number 2349 (Engineering/Construction)
Cost of Construction Services Contract Amendment No. 2: $ 111,307.30
Total estimated project cost:
$ 290,610.00 Engineering Already authorized Yes No
$ 4,591,662.95 Construction Already authorized Yes No
$ (45.60) Contract Amendment No. 1 Already authorized Yes No
$ 111,307.30 Contract Amendment No. 2 Already authorized Yes No
$ 4,993,534.65 Total estimated costs
234
CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE A CONSTRUCTION SERVICES
CONTRACT AMENDMENT NO. 2 WITH KIK UNDERGROUND, LLC FOR THE
PHASE 13 RESIDENTIAL STREET RECONSTRUCTION PROJECT; AND
PROVIDING AN EFFECTIVE DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City of The Colony, Texas hereby authorizes the City
Manager to execute a Construction Services Contract Amendment No. 2 in the amount of
$111,307.30 with KIK Underground, LLC for the Phase 13 Residential Street Reconstruction Project.
Section 2. That the City Manager is hereby authorized to execute said amendment.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
235
Agenda Item No:6.8
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Robert Kotasek
Submitting Department: Engineering
Item Type: Resolution
Agenda Section:
Subject:
Consider approving a resolution authorizing the City Manager to execute an Engineering Services Contract in
the amount of $166,525.00 with Shield Engineering Group, PLLC. to prepare construction plans and
specifications for the Sutton Branch Streambank Stabilization Project. (Hartline)
Suggested Action:
Background:
This contract will authorize Shield Engineering Group, PLLC, to prepare construction plans and contract
specifications for the Sutton Branch Streambank Stabilization Project. City Council has approved funding for the
repair of this area in the 2023/2024 CIP budget.
Due to heavy rainfall events over the past several years, erosion has developed along Sutton Branch, from the
crossing at Blair Oaks Drive upstream to a point approximately 675 linear feet downstream of Blair Oaks Drive,
within the City’s existing variable-width floodway and drainage easement. If left unaddressed, this erosion could
impact the residential properties on both sides of the streambanks along this stretch. In some areas, electric
lines are exposed, and the streambanks on both sides have eroded to the point of being very close to the
fences of adjacent properties. Stabilizing the banks is needed to prevent further damage to the stream banks
and potentially impacting the adjacent private properties. This project will also re-establish the banks along
Sutton Branch that have also been damaged and eroded. A Site Location Map and photos of the area of
concern are attached for review.
The scope of services for the design services contract will be addressed in four steps. The first step is to
perform a site visit, survey the channel, and locate the Ordinary High Water Mark (OHWM) and perform a
Wetlands Jurisdictional Determination. The OHWM and Wetlands Jurisdictional limits will provide the
boundaries of federal jurisdiction under Section 404 of the Clean Water Act. The second step involves collecting
data on the erosion problem and conducting a preliminary hydraulic and hydrologic analysis to ensure that the
proposed design will not cause a rise in water surface levels or an increase the erosive velocities within the
project area. The third step is to design the preventative maintenance improvements to stabilize and
re-establish the streambanks, addressing areas of erosion along this section of Sutton Branch. The final step
involves managing the bidding and construction phase services needed for the project.
The total cost of the engineering services contract with Shield Engineering Group, PLLC, is $166,525.00. With
approval of this contract, the project is anticipated to be advertised for bidding in June 2025.
Attachments:
Location Map
236
Existing Photos of Sutton Branch Streambank Erosion
Engineering Services Contract
Financial Summary
Res. 2024-xxx Shield Engineering.docx
237
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µLocation MapSutton Branch Streambank Stabilization Maintenance
Sutton Branch Streambank
Stabilization Maintenance Project
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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Existing Photos of Sutton Branch Streambank Erosion
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FINANCIAL SUMMARY:
Are budgeted funds available: Yes
Amount budgeted/available: $1,600,000.00
(Sutton Channel Repair from Blair Oaks culvert to Good Sheppard Church)
Source of Funds: 895-669-6667-2479
Cost of recommended contract award: $ 166,525.00
Total estimated project cost:
$ 166,525.00 Engineering Already authorized Yes No
$ 166,525.00 Total estimated costs
266
CITY OF THE COLONY, TEXAS
RESOLUTION NO. 2024 - _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE AN ENGINEERING
CONTRACT WITH SHIELD ENGINEERING GROUP, PLLC. TO PREPARE
CONSTRUCTION PLANS AND SPECIFICATIONS FOR THE SUTTON BRANCH
STREAMBANK STABILIZATION PROJECT; AND PROVIDING AN EFFECTIVE
DATE.
NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
Section 1.That the City Council of the City ofThe Colony, Texas hereby authorizes the City
Manager to execute an Engineering Services Contract in the amount of $166,525.00 with Shield
Engineering Group, PLLC. To prepare construction plans and specifications for the Sutton Branch
Streambank Stabilization Project.
Section 2. That the City Manager is hereby authorized to execute said contract.
Section 3.This resolution shall take effect immediately from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, THIS 19TH DAY OF NOVEMBER 2024.
____________________________________
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
____________________________________
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
____________________________________
Jeffrey L. Moore, City Attorney
267
Agenda Item No:7.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Isaac Williams
Submitting Department: Planning
Item Type: Discussion
Agenda Section:
Subject:
Conduct a public hearing, discuss and consider an appeal of the Sign Board of Appeals regarding a variance
from Chapter 6, Section 6-262 (f) [Pylon Signs] to allow a pylon sign with a 10 ft. [side] setback from the
property line, where the minimum required setback is 40 ft. The subject site is located at 4675 SH 121 within
the General Retail (GR) zoning district and the Gateway Overlay District. (Williams)
Suggested Action:
Please see the attached staff report, drawings, maps and illustrations for detailed land use, site layout and staff
recommendation
Attachments:
SBA24-0001 Club Car Wash- CC Staff Report & Final Exhibits.pdf
268
1
CITY COUNCIL APPEALS STAFF REPORT
AGENDA DATE: November 19, 2024
DEPARTMENT: Planning and Development Department
SUBJECT: SBA24-0001 - 4675 SH 121- Club Car Wash Sign Setback Variance
Conduct a public hearing, discuss and consider an appeal of the Sign Board of Appeals regarding
a variance from Chapter 6, Section 6-262 (f) [Pylon Signs] to allow a pylon sign with a 10 ft. [side]
setback from the property line, where the minimum required setback is 40 ft. The subject site is
located at 4675 SH 121 within the General Retail (GR) zoning district and the Gateway Overlay
District.
APPLICANT
Owner: Jared Bruemmer The Colony, TX
Applicant: Jose Campos San Antonio, TX
ADJACENT ZONING AND LAND USES
North - General Retail (GR) – Colony II Shopping Center
South - SH-121
West - Business Park (BP) – Texas Roadhouse and La Quinta Inn & Suites
East - General Retail (GR) – Jack in the Box
BACKGROUND
September 23, 2024 the applicant submitted a variance request to the Sign Board of Appeals for
consideration to allow the proposed “Club Car Wash sign setback variance” at 4675 SH 121.
Review of the provided application reflected the intent to erect a new thirty (30’) foot tall and
fifteen (15’) foot wide “Club Car Wash double pole pylon sign.” The applicant stated that the 40
ft. setback combined with the double pole pylon requires a large space that Club Car Wash is not
able to accommodate due to essential supporting equipment based near the building. To improve
visibility and allow adequate space for supporting equipment, the applicant requested a sign
variance to Section 6-262 (f) [Pylon Signs] to allow a 10 ft. side setback where 40 ft. is the
minimum required setback from any side or rear property line. Section 6-262 (f) [Pylon Signs]
reads as follows:
(f) Pylon Signs
Location Permitted only along the frontage of State Highway 121 as follows:
Minimum 40 feet setback from any side or rear property line
Minimum ten feet from any easement or property line adjacent to a street
Minimum 50 feet setback from any residential property line
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The Sign Board of Appeals considered the following:
Variance Criteria:
A variance shall not be granted to relieve a self-imposed or personal hardship, nor shall it be based
solely on economic gain or loss. In order to make a finding of hardship and to grant a variance
from this article, the board must determine that:
1) The requested variance does not violate the intent of the article.
2) The requested variance will not adversely affect surrounding properties.
3) The requested variance will not adversely affect public safety.
4) Special conditions exist which are unique to the applicant or property.
5) The requested variance is not self-imposed or granted to relieve a personal hardship.
6) The requested variance is not based solely on economic gain or loss.
Criterion 1. The proposed sign does not violate the intent of the ordinance
The purpose of the Sign Ordinance is to regulate the location, size, construction, duration, use,
and maintenance of all signs within the corporate city limits and the extraterritorial jurisdiction
of the city on a content-neutral basis. In addition, the purpose of the Sign Ordinance is to
promote the health, safety, and welfare of the public, to achieve the efficient transfer of
information to the public, and to preserve and enhance the appearance and economic value of
the built environment. Pylon signs are approved sign types that fit within the stated intent of the
Sign Ordinance as listed 6-262 (Permanent Signs).
Criterion 2. The proposed sign does not adversely affect the surrounding property owners
There is no evidence the proposed sign will adversely affect the surrounding property owners.
The Sign Ordinance states that pylon signs must maintain a minimum separation distance of
150 feet per premises. The proposed sign will be approximately 140 feet from the neighboring
sign (Jack in the Box). This is greater than the spacing between signs in the surrounding area.
Criterion 3. The proposed sign does not adversely affect public safety
Staff does not anticipate an adverse effect to public safety. The proposed sign is consistent with
signage found along major thoroughfares and similar signage exists along SH 121 within the
city limits.
Criterion 4. Special conditions exist which are unique to the applicant or property
Review of the request and a site visit, reflect no unique conditions to the applicant or property.
The subject site’s sign location and configuration is consistent with the majority of properties
along SH 121.
Criterion 5. The requested variance is not self-imposed or granted to relieve a personal hardship.
Staff finds the requested variance does not represent a self-imposed hardship. If the applicant
were to place the sign within the 40 ft. setback it would obstruct access to the building and limit
visibility due to the location of adjacent signs.
Criterion 6. The requested variance is not based solely on economic gain or loss.
Staff finds the requested variance is not based solely on economic gain or loss. The proposed
sign placement will allow adequate space between the building and sign for proper circulation
on the premises.
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PRIOR ACTION
On October 16, 2024 the Development Review Committee presented an evaluation of the request
with the recommendation “The DRC finds that the criteria for variance review have been
addressed. The DRC recommends approval of the requested variance.” The Sign Board of Appeals
considered staff presentation and the testimony of the applicant and voted (4-1) to deny the
variance for the proposed “Club Car Wash Sign Setback Variance.”
The applicant subsequently submitted to staff, an appeal to City Council in accordance with
Section 6-256 (f). The applicant’s appeal to City Council provides a narrative that states in part:
“The Sign Board of Appeals denied our request for a 10 ft. side setback variance, which was
sought to deviate from the standard 40 ft. minimum required under Chapter 6, Section 6-262 (f).
We respectfully request that the City Council reconsider this decision, based on the unique site
limitations and safety concerns.”
In accordance with Section 6-256, the City Council’s decision is final.
ATTACHMENTS
1. Location Map
2. SBOA packet documents (considered by SBOA 10-16-24)
3. City Council notice of appeal documents
4. October 16, 2024 SBOA Minutes
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S A M R A Y B U R N T O L L W A Y
E X I T S T A N D R I D G E / C A S T L E H I L L S
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4675
4683
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G RGR
B PBP
This map was generated by GIS data provided by The Colony GIS Department. The City of The Colony does not guarantee the correctness or accuracy of any features on this map.
These digital products are for llustration purposes only and are not suitable for site-specific decision making. ±Project No: SB A24-0001 - Club C arwash Pylon Sign Variance
SubjectArea
Business Park
General Retail
272
2438 Freedom Drive * San Antonio, TX 78217 * (210) 826-2800 * Fax (210) 477-2323 1
Aetna Sign Group
2438 Freedom Dr
San Antonio, TX, 78217
permits@aetnasign.com
210.826.2800
September 23rd, 2024
To:
City of The Colony
Development Services
6800 Main Street
The Colony, TX, 75056
Subject: Variance for Pylon setback
• Sec. 6-257- Sign Placement
We are requesting a variance to your sign code and asking that we change the
pylon sign setback from 40 feet to 10 feet to improve visibility and enhance business
operations. Unfortunately, we are unable to place the pylon sign anywhere else on the
property that would be beneficial for the business. The 40-foot setback combined with
the double pole pylon requires a large space that Club Car Wash is not feasibly able to
accommodate due to essential supporting equipment based near the main building.
By reducing the setback to 10 feet, the sign will be more visible to passing
motorists, increasing customer awareness and foot traffic. This adjustment is critical for
businesses located near high-traffic areas where rapid decision-making by drivers is
necessary. Additionally, the variance will help ensure that the signage remains
competitive with nearby commercial developments while adhering to safety and
aesthetic standards. As shown in attachments, the proposed sign variance will not
adversely affect the surrounding businesses.
Club Car Wash looks forward to being a valued partner within your community
and appreciates your consideration in this matter.
Best regards,
Larry Gottsman
President
Aetna Sign Group
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Agenda Item No:7.2
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Isaac Williams
Submitting Department: Planning
Item Type: Ordinance
Agenda Section:
Subject:
[CONTINUED FROM 11/06/2024] Conduct a public hearing, discuss and consider an ordinance regarding the
approval of a Specific Use Permit (SUP) to allow a laboratory with scientific testing and administrative office
known as “Devansh Lab Werks,” located at 6600 Paige Road Suite 100 and Suite 111, within the Office 1 (O-1)
Zoning District and Gateway Overlay District. (Williams)
Suggested Action:
please see the attached staff report, drawings, maps and illustrations for detailed land use, site layout and staff
recommendations
Attachments:
SUP24-0003 CC staff report draft.doc
Ordinance EXHIBITS (rev).pdf
Ord.2024-xxxx Devansh Lab Werks.docx
278
1
CITY COUNCIL REPORT
AGENDA DATE:October 15, 2024
DEPARTMENT:Planning Department
SUBJECT:
SUP24-0003: 6600 Paige Road, Suite 111 Devansh Lab Werks (Laboratory- Scientific Testing)
Conduct a public hearing, discuss and consider an ordinance regarding the approval of a Specific
Use Permit (SUP) to allow a laboratory with scientific testing and administrative office known as
“Devansh Lab Werks,” located at 6600 Paige Road Suite 100 and Suite 111, within the Office 1
(O-1) Zoning District and Gateway Overlay District.
OWNER/ENGINEER
Owner:YODH Investors Inc. Irving, Texas
Applicant:Sudhakar Kancharla The Colony, Texas
EXISTING CONDITION OF PROPERTY
The tenant space within Paige Plaza was previously developed as a church, known as “Horizons
Church”, at 6600 Paige Rd, Suite 111.
PROPOSED DEVELOPMENT
The applicant requests Specific Use Permit (SUP) approval to allow the use of a proposed
Laboratory with scientific testing within Paige Plaza. The proposed use will provide diagnostic
testing services related to blood clinical chemistry and urine toxicology. The applicant intends to
operate from Monday to Saturday between 9:00 a.m. until 6:00 p.m.
PRIOR ACTION
On October 8, 2024 the Planning and Zoning Commission recomended (5-0) to approve the
request regarding the Specific Use Permit (SUP) of a laboratory with scientific testing known as
“Devansh Lab Werks” at 6600 Paige Rd, Suite 111 (Paige Plaza).
ADJACENT ZONING AND LAND USE
North - Single-Family -4 (SF-4) – Subdivision Colony No. 11
South - Single-Family -4 (SF-4) – Subdivision Colony No. 8
East - Single-Family -4 (SF-4) – North Colony Church of Christ
West -Single-Family -4 (SF-4) – Subdivision Colony No. 11
DEVELOPMENT REVIEW COMMITTEE (DRC) REVIEW
The Development Review Committee (DRC) finds the SUP meets the requirements of The
Colony Code of Ordinances, Appendix A, Zoning Ordinance and other applicable ordinances as
outlined in the Staff Report.
ATTACHMENTS
1. Staff Analysis 4. Applicant Narrative
2. Location Map 5. Planning and Zoning Commision
3. Site Plan and floor plan minutes
279
2
ATTACHMENT 1
Staff Analysis
Land Use Analysis
The subject site is located within the Office 1 (O-1) Zoning District. This establishment will be
considered a Laboratory with scientific testing which requires a SUP in in the O-1 Zoning
District. Specific Use Permit approval is intended to offer further evaluation of certain uses and
appropriateness of the operation of those uses within the context of the surrounding area. The
proposed laboratory with scientific testing will occupy the former Horizons Church, located in
suite 111 at 6600 Paige Road. The applicant intends to operate from Monday to Saturday between
9:00 a.m. until 6:00 p.m.
Devansh Lab Werks will occupy two suites in Paige Plaza. Suite 111 is 6,508 sq. ft. and will
function as the laboratory where the clinical testing will take place and the related diagnostic
technology will be located. Suite 100 is 1,160 sq. ft. and will operate as an office/administrative
space, similar to existing uses within Paige Plaza. Uses within the Office 1 (O-1) Zoning District
typically include general office spaces, medical clinics and shops with limitations. Nearby uses in
the O-1 District include: existing businesses in Paige Plaza [Medical center, Dentist office, Tax
services].
Specific Use Permit (SUP) Criteria
In accordance with Section 10-905 (Special Use Permits - Approval Criteria) of the Zoning
Ordinance, the Planning and Zoning Commission and City Council shall review and evaluate a
Specific Use Permit application using the following criteria:
1.Conformance with the City of The Colony’s Comprehensive Plan;
The Future Land Use Map identifies this area as “Single Family Residential
Neighborhoods” which includes single-family, detached homes on individual lots.
Although the proposed land use is not in strict conformance with the Single Family
Neighborhood recommendation of the comprehensive plan, it is proper to consider within
the context of the Office-1 (O-1), and the anticipation that O-1 districts and O-1 district
uses will be located in close proximity to residential areas.
2.Conformance with applicable regulations and standards established by the zoning
regulations;
With the approval of the SUP, the application will be in conformance with the Zoning
Ordinance and the applicable single-family 4 zoning regulations being located in close
proximity to residential areas.
3.Compatibility with existing or permitted uses on abutting sites, in terms of building
height, build and scale, setbacks on open spaces, landscaping and site development,
access and circulation features, architectural compatibility;
The proposed Laboratory with scientific testing use is generally compatible with the
existing and permitted uses on site. The surrounding area is primarily single family
residential and the plaza is developed in accordance with the zoning regulations.
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4.Safety and convenience of vehicular and pedestrian circulation in the vicinity,
including traffic reasonably expected to be generated by the proposed use and other
uses reasonable and anticipated in the area, existing zoning and land uses in the area;
The site layout for the subject site has been reviewed and has been previously approved by
the City, which meets traffic circulation and associated requirements.
5.Protection of persons and property from erosion, flood, or water damage, fire, noise,
glare, air quality, generation of dust and odors, and similar hazards and impacts;
The subject site was developed in accordance with the applicable regulations at the time
of construction.
6.Location, lighting and type of signs; the relation of signs to traffic control and
adverse effect of signs on adjacent properties;
All existing lighting will remain as previously approved. All signage shall be reviewed in
accordance with the Sign Ordinance.
7.Adequacy and convenience of off-street parking and loading facilities;
The subject site meets the Zoning Ordinance requirements for off-street parking and no
increase in off-street parking is anticipated.
8.Determination that the proposed use and site development, together with any
modifications applicable thereto, will be compatible with existing or permitted uses in
the vicinity;
Developments within Office 1 (O-1) Zoning District generally consist of office spaces and
clinics. The proposed development of a Laboratory with scientific testing is compatible
with the intended uses for Office 1 (O-1) Zoning District and permitted uses in the vicinity.
9.Determination that any conditions applicable to approval are the minimum necessary
to minimize potentially unfavorable impacts on nearby uses in the same district and
surrounding area
No special conditions are being recommended by staff. The proposed use as requested is
not anticipated to create any unfavorable impacts on nearby uses in the same district and
surrounding area.
10.Determination that the proposed use, together with the conditions applicable thereto,
will not be detrimental to the public health, safety, or welfare of materially injurious
to properties or improvements in the vicinity.
The proposed use is not anticipated to be detrimental to the public health, safety, or
welfare.
Infrastructure Improvements
No specific public infrastructure improvements are planned for this area.
Notification
The Zoning Ordinance requires newspaper notification a minimum of fifteen (15) days prior to
the City Council meeting. Notice for this SUP Public Hearing was published in The Dallas
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Morning News on September 25, 2024. In addition, the Zoning Ordinance requires notification of
property owners located within 200 feet of the subject property. Public Hearing notices were
mailed on September 25, 2024 to adjacent property owners. No comments either for or against
the SUP were received as of printing of this packet.
Development Review Committee Review
The Development Review Committee (DRC) finds the SUP meets the requirements of The
Colony Code of Ordinances, Appendix A, Zoning Ordinance and other applicable ordinances as
outlined in the Staff Report.
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289
+1 (205) 994-8266
6600 Paige RD Suite 111,
The Colony, TX 75056
info@devlabwerks.com
www.devlabwerks.com
205-201-4797 234 Aquarius Drive, Suite
100,111, Homewood, AL 35209
To
Planning Department
From
Devansh Lab Werks,
6600 Paige Rd, #111,
The Colony, TX, 75056.
Sub: Project Narrative: Special Use Permit for Clinical Diagnostics Laboratory
Project Overview:
This project seeks approval for a Special Use Permit (SUP) to establish and operate a Clinical Diagnostics
Laboratory at 6600 Paige Rd, Suite 111, The Colony TX 75056. The laboratory will provide a comprehensive
range of diagnostic services, including blood tests, molecular diagnostics, and other specialized analyses,
contributing to the overall healthcare infrastructure of the community.
In addition, we provide the Mobile Phlebotomy Services for blood collection and other diagnostic services to
patients at their homes. This addition allows the facility to serve a wider range of patients, including those
who are homebound, enhancing healthcare accessibility for the community.
The proposed site is currently zoned as an Office District, allowing for a range of commercial and medical uses.
However, under the current zoning regulations, a Clinical Diagnostics Laboratory requires a Special Use Permit
(SUP). The request for this SUP is supported by the growing community demand for accessible, high-quality
diagnostic services, which the laboratory will provide. The Mobile Phlebotomy Services align with the intended
use by expanding the reach of medical services to meet the growing community demand for home-based
diagnostics. The proposed laboratory complies with The Colony’s Comprehensive Plan, which emphasizes the
need for healthcare facilities to serve the city’s expanding population. The plan highlights the importance of
accessible healthcare services within commercial zones, and the laboratory’s location supports these
objectives by offering essential services close to residential areas and other medical providers.
The laboratory will fully adhere to all zoning regulations and standards established by the City of The Colony,
including building codes, land use regulations, and environmental standards. No significant variances from the
current development regulations are necessary, ensuring the facility fits the intended use and scale of the
zoning district. The potential impact on neighbouring properties has been carefully considered, and the
operations of the laboratory are expected to be comparable to those of other permitted medical or
commercial uses, without causing excessive noise, traffic, or disturbances. The addition of Mobile Phlebotomy
Services is not expected to generate excessive traffic or disturbances, as mobile services will operate offsite,
traveling directly to patients’ homes.
290
+1 (205) 994-8266
6600 Paige RD Suite 111,
The Colony, TX 75056
info@devlabwerks.com
www.devlabwerks.com
205-201-4797 234 Aquarius Drive, Suite
100,111, Homewood, AL 35209
The Mobile Phlebotomy Services will be operated by employee own vehicles, each equipped with the
necessary medical supplies and tools to perform blood draws and other specimen collections at patients’
residences. These vehicles will be staffed by trained, certified phlebotomists who adhere to all medical
protocols to ensure safe and sterile procedures. All Phlebotomists will start their work based on patient
appointments scheduled in advance through the laboratory’s centralized system. This service offers
convenience to patients who cannot travel to the clinic and supports physicians who require timely diagnostic
information for homebound patients.
Operational Process:
Appointment Scheduling: Patients or their healthcare providers schedule appointments via phone or an
online platform. The scheduling system allows for efficient route planning to minimize travel times and ensure
timely service.
Preparation and Dispatch: Each phlebotomist is assigned appointments in advance and provided with all the
necessary equipment so that their starting point for work is from their home itself. This allows them to go
directly to their scheduled appointments without needing to check in at a physical office, streamlining the
process and ensuring they have everything they need for the day. The vehicles are stocked with sterile
supplies, including blood collection tubes, needles, gloves, and alcohol swabs, ensuring the highest standards
of hygiene.
On-site Procedure: Upon arrival at the patient’s home, the phlebotomist follows strict procedural guidelines,
including the verification of patient identity, sterile techniques, and proper collection methods. Collected
specimens are stored in temperature-controlled containers within the vehicle to maintain integrity until
delivered to the laboratory for analysis.
Specimen Delivery: At the end of each route, collected specimens are returned to the Clinical Diagnostics
Laboratory for processing at staggered intervals throughout the day. Phlebotomists will not all drop off
specimens at the same time, thus avoiding any potential traffic congestion around the laboratory. Each
phlebotomist is assigned specific time slots during their routes for specimen delivery, ensuring that traffic is
minimal, and the workflow remains smooth. Furthermore, some phlebotomists may hand over specimens to a
designated courier service, which will transport the samples to the lab, further reducing the need for multiple
vehicles to arrive at the laboratory simultaneously. The laboratory ensures that the specimens are properly
stored and transported in temperature-controlled containers during transit, safeguarding their integrity. This
staggered delivery system allows for efficient processing without overwhelming the lab staff or impacting
surrounding traffic conditions. The samples are processed immediately to ensure accurate and timely results.
Impact on Traffic and Neighbourhood: The addition of Mobile Phlebotomy Services is not expected to
generate excessive traffic or disturbances. With a pre-scheduled appointment system, the service will operate
smoothly without increasing local traffic congestion. The vehicles will spend minimal time at each site,
reducing their presence in residential areas, and because all collection and testing are performed offsite, there
is no risk of onsite contamination or disturbances.
291
+1 (205) 994-8266
6600 Paige RD Suite 111,
The Colony, TX 75056
info@devlabwerks.com
www.devlabwerks.com
205-201-4797 234 Aquarius Drive, Suite
100,111, Homewood, AL 35209
The Mobile Phlebotomy Services will significantly enhance the reach and impact of the Clinical Diagnostics
Laboratory. These services are designed to meet the growing demand for accessible healthcare by providing
at-home diagnostic support while adhering to strict protocols for medical waste handling and disposal. With
robust operational systems and a commitment to patient safety, the laboratory and mobile services will
ensure minimal impact on neighbouring properties while offering valuable healthcare services to the
community.
To minimize any possible effects on surrounding properties, the laboratory will implement advanced waste
management and noise reduction protocols. As this project focuses on interior finishes, there will be no
concerns related to erosion, flooding, noise, glare, air quality, dust, or Odors. Given that this is a testing
laboratory, the facility will strictly adhere to environmental and safety regulations, including the proper
handling and disposal of biohazardous materials. Emergency response protocols will be in place to manage
any unforeseen incidents.
Medical Waste Disposal Procedures:
Given the nature of the services provided, the handling and disposal of medical waste are of critical
importance. The laboratory and mobile services will strictly adhere to state and federal regulations regarding
the handling of biohazardous materials. The following procedures will be in place:
Segregation of Waste: All biohazardous waste, including used needles, gloves, and other contaminated
materials, will be immediately placed into puncture-resistant, leak-proof containers (sharps containers for
needles) within the lab and mobile units. Non-hazardous waste will be separated from biohazardous materials
to prevent cross-contamination.
On-site Containment: In the lab and mobile units, all biohazardous waste will be securely stored in designated
areas to prevent exposure or accidental spills. Each vehicle will carry appropriate containment tools, such as
sealed bags and containers, for the safe storage of waste during transit.
Transportation and Disposal: At the end of the day, all medical waste collected from mobile phlebotomy
services will be returned to the laboratory’s central facility for proper disposal. The laboratory will partner
with a licensed medical waste disposal service that follows OSHA and EPA guidelines to transport and
incinerate or treat the waste. This ensures that all waste is disposed of in a manner that minimizes
environmental impact and adheres to regulatory standards.
Compliance and Audits: Regular audits and staff training will be conducted to ensure that waste disposal
protocols are being followed accurately. The laboratory will maintain records of waste disposal to comply with
regulatory requirements and ensure accountability.
The site development and operations have been carefully designed to complement nearby medical and
commercial establishments, without introducing incompatible activities. The facility’s impact on surrounding
districts will be minimal, with all city codes and regulations followed to mitigate any potential issues.
292
+1 (205) 994-8266
6600 Paige RD Suite 111,
The Colony, TX 75056
info@devlabwerks.com
www.devlabwerks.com
205-201-4797 234 Aquarius Drive, Suite
100,111, Homewood, AL 35209
The establishment of the Clinical Diagnostics Laboratory under the SUP will not pose a risk to public health,
safety, or welfare. On the contrary, it will provide essential healthcare services that benefit the community.
The design and operation of the laboratory are intended to be non-injurious to neighbouring properties and
improvements, instead enhancing the overall quality of healthcare available in the area.
Thank you,
Devansh Lab Werks.
293
294
1
CITY OF THE COLONY, TEXAS
ORDINANCE NO. 2024-_____
SPECIFIC USE PERMIT (SUP) – DEVANSH LAB WERKS.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF THE
COLONY, TEXAS, APPROVING A SPECIFIC USE PERMIT (SUP) TO
ALLOW A LABORATORY WITH SCIENTIFIC TESTING, KNOWN AS
DEVANSH LAB WERKSTO BE LOCATED AT 6600 PAIGE ROAD SUITE
100 AND 111, THE COLONY, TEXAS, CONTAINING A TOTAL AREA OF
APPROXIMATELY 7,668 SQUARE FEET, AND IS WITHIN THE OFFICE
1 (O-1) ZONING DISTRICT AND THE GATEWAY OVERLAY DISTRICT;
PROVIDING A REPEALER CLAUSE; AND PROVIDING FOR AN
EFFECTIVE DATE.
WHEREAS, the Planning and Zoning Commission and the City Council of the City of
The Colony, Texas, in compliance with the laws of the State of Texas, and the Code of Ordinances
of the City of The Colony, Texas, have given any requisite notices by publication and otherwise,
and have held due public hearings, and afforded a full and fair hearing to all property owners
generally, and to all persons interested, and is of the opinion and finds that Specific Use Permit
No. SUP24-0003 should be approved to allow a laboratory with scientific testing, known as
Devansh Lab Werks , to be located at 6600 Paige Road, Suite 100 and 111, The Colony, Texas
75056, and is within the Office 1 (O-1) Zoning District and the Gateway Overlay District.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS:
SECTION 1. That the findings set forth above are incorporated into the body of this
Ordinance as if fully set forth herein.
SECTION 2.That the City Council of the City of The Colony, Texas, does hereby
approve the Specific Use Permit to allow a laboratory with scientific testing for Devansh Lab
Werks, located at 6600 Paige Road, Suite 100 and 111, The Colony, Texas 75056, and is within
the Office 1 (O-1) Zoning District and Gateway Overlay District.
SECTION 3.That it is hereby declared to be the intention of the City Council of the City
of The Colony, Texas, that the phrases, clauses, sentences, paragraphs and sections of this
Ordinance are severable, and if any phrase, clause, sentence, paragraph or section of this Ordinance
shall be declared unconstitutional by the valid judgment or decree of any court of competent
jurisdiction, such unconstitutionality shall not affect any of the remaining phrases, clauses,
sentences, paragraphs and sections of this Ordinance, since the same would have been enacted by
the City Council without the incorporation of this Ordinance of any such unconstitutional phrase,
clause, sentence, paragraph or section.
SECTION 4. That any provision of any prior ordinance of the City whether codified or
295
2
uncodified, which are in conflict with any provision of this Ordinance, are hereby repealed to the
extent of the conflict, but all other provisions of the ordinances of the City whether codified or
uncodified, which are not in conflict with the provisions of this Ordinance, shall remain in full
force and effect.
SECTION 5. That this Ordinance shall become effective immediately upon its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
THE COLONY, TEXAS THIS 19TH DAY OF NOVEMBER 2024.
Richard Boyer, Mayor
City of The Colony, Texas
ATTEST:
Tina Stewart, TRMC, CMC, City Secretary
APPROVED AS TO FORM:
Jeffrey L. Moore, City Attorney
296
Agenda Item No:8.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Kimberly Thompson
Submitting Department: City Secretary
Item Type: Discussion
Agenda Section:
Subject:
A. Council shall convene into a closed executive session pursuant to Sections 551.072 and 551.087 of the
Texas Government Code to deliberate regarding purchase, exchange, lease or value of real property and
commercial or financial information the city has received from a business prospect(s), and to deliberate the
offer of a financial or other incentive to a business prospect(s).
B. Council shall convene into a closed executive session pursuant to Sections 551.071 and 551.072 of the
Texas Government Code to deliberate regarding purchase, exchange, lease or value of real property and to
seek legal advice from the city attorney regarding Blue Sky Sports Center, L.P. matter.
Suggested Action:
Attachments:
297
Agenda Item No:9.1
CITY COUNCIL Agenda Item Report
Meeting Date: November 19, 2024
Submitted by: Kimberly Thompson
Submitting Department: City Secretary
Item Type: Discussion
Agenda Section:
Subject:
A. Any action as a result of executive session regarding purchase, exchange, lease or value of real property and
commercial or financial information the city has received from a business prospect(s), and the offer of a
financial or other incentive to a business prospect(s).
B. Any action as a result of executive session regarding purchase, exchange, lease or value of real property
and to seek legal advice from the city attorney regarding Blue Sky Sports Center, L.P. matter.
Suggested Action:
Attachments:
298