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HomeMy WebLinkAboutResolution No. 04-56 RESOLUTION NO. 04-.~ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, APPROVING THE ASSIGNMENT OF THE EXISTING LEASE FOR THE STEWART PENINSULA GOLF COURSE, WHICH IS ATTACHED HERETO AND INCORPORATED HEREIN AS EXHIBIT "A"; AUTHORIZING THE MAYOR TO EXECUTE THE APPROPRIATE DOCUMENTS; AND PROVIDING AN EFFECTIVE DATE WHEREAS, on or about February 15, 1995 the City and Peninsula Golf Associates, Ltd. Entered into a Ground Lease Agreement, which is attached hereto and incorporated herein as Exhibit "A" (hereinafter, the "Lease"), concerning the maintenance and operation of the Stewart Peninsula Golf Course; and WHEREAS, said lease provides that any assignment and sublet of the golf course shall require the express written approval of the City and the District Engineer; and WHEREAS, Peninsula Golf Associates desires to assign the existing lease to VERDI, LLC and pursuant to Article 16 of the Lease, Peninsula Golf Associates is seeking the City's approval for the same; and WHEREAS, the City has determined that it is in the best interest of the City to approve the assigmnent of the Lease Agreement from Peninsula Golf Course to VERDI, LLC, in a form to be approved by the City Attorney; THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS THAT: Section 1. That the City Council hereby approves the assignment of the existing Ground Lease Agreement, dated February 15, 1995, for the Stewart Peninsula Golf Course from Peninsula Golf Course to VERDI, LLC, and the Mayor is hereby authorized to execute the appropriate documents for such assignment on behalf of the City of The Colony, Texas, after review and approval of the City Attomey. Section 2. That this Resolution shall take effect immediately from and after its adoption and it is so resolved. PASSED, APPROVED and EFFECTIVE this /~dayof~k~ ,2004. tDillard, Mayor of The Colony, Texas 66300 ATTEST: Christie Wilson, TMRC, City Secretary City o£Th¢ Colony, Texas APP~O FORM: ~)tby~orTtf ~'h eH acgoelr~ y~, T eAxt~ s° m e Y (REH//cdb [revised 7/19/04] 66300) 66300 GROUND LEASE AGREEMEN~F~ THIS GROUND LEASE AGREEMENT, hereinafter called the" ,,  Lease , is made and entered into this day of._~~e / -- , 1995, by and between the City of The Colony, Texas, a Texas municipal corporation, hereinafter referred to as ssor, and Peninsula Golf Associates, Ltd., a Texas limited partnership, hereinafter referred to " as Lessee. RECITALS WHEREAS, Lessor is a municipal corporation which has leased from the Corps (as hereinafter defined) certain acreage in Denton County, Texas, as identified on Exhibit "A" attached hereto as the Stewart Creek Park Parcel, for the purpose of developing said acreage into a recreational area, and WHEREAS, Lessee's obligations hereunder are expressly contingent upon Lessee's successful private offering of limited partnership interests to investors to raise a portion of the necessary capital, all on such terms as are acceptable to Lessee in its sole discretion. Accordingly, if Lessee is unable to accomplish a successful offering as described above within three hundred (300) days after the Lease Commencement Date, this Agreement will, at Lessee's election, be of no further force or effect. WHEREAS, Lessor desires to sublease to Lessee approximately 60 acres leased by Lessor from the Corps to permit Lessee to operate a golfing and recreational facility on said acreage. G~ROUND~ LEASE AGREEMENT _P_.~e ! NOW, THEREFORE, for good and valuable considerations, the receipt and sufficiency of all of which are mutually acknowledged, the parties hereby agree as follows. ARTICLE 1. DEFINITIONS cared: 1.01 For purposes of this lease, the following terms shall have the meanings indi- A. Annual Rental Payments: The term "Annual Rental Payments" shall mean those rental payments that shall become due as set forth in Section 4.01. B. Lease Commencement Date: The term "Lease Commencement Date" shall mean the date in which this Lease is fully executed by all parties. C. Rent Commencement Date: The term "Rent Commencement Date" shall mean the date on which Lessee shall open the Golfing Facility for general use by the public on a daily fee paying basis. D. Lease Year: The term "Lease Year" shall mean, during the term of this Lease, the twelve-month period commencing on the Rent Commencement Date and each successive twelve-month period thereafter commencing on an anniversary of the Rent Commencement Date. E. Corps: The term "Corps" shall mean the U. S. Army Corps of Engineers, Fort Worth District. F. Corps I~2se: The term "Corps Lease" shall mean that certain lease between the [/. S. Army Corps of Engineers, as Lessor, and the City of The Colony, as Lessee, designated as Lease No. DACW63-1_85_0680 dated 28 June, 1985, which establishes and GROUND LEASE AGREEMENT governs the rights of the City of The Colony in regard to the Leased Premises, known as Stewart Creek Park, as hereinafter defined, as well as other property designated therein as "Wynnewood Park" (herein so called). A copy of the Corps Lease is attached hereto as _Exhibit "B" and incorporated herein by reference. G. District Engineer: The term "District Engineer" shall mean the Id. S. Army District Engineer for the Fort Worth District who is in charge of the administration of the Lewisville Lake Project Area, his successors, assigns or duty authorized represen- tatives, with addresses of District Engineer, Fort Worth District, Corps of Engineers, P.O. Box 17300, Fort Worth, Texas 76102. Attn: Real Estate Division, CESWF-RE~M. H. Extended Term: The term "Extended Term" shall mean that period of time beginning with the termination date of the Initial Term and terminating twenty-five years thereafter, subject to renewal of the Corps Lease for like term. I. Golfing Facility: The term "Golfing Facility" shall mean at least a nine (9) hole golf facility, together with such auxiliary improvements associated therewith as Lessee deems appropriate, Wtlle-"xnay in~U~e without/imitation, a restaurant, boat rentals, /h~fing~facilifies; and pro shop, to be operated by Lessee on the Leased Premiss. J- Gross Sales Receipts: The term "Gross Sales Receipts" shall mean all receipts collected and earned by Lessee subsequent to the Rent Commencement Date for all goods and services sold or rented by Lessee from or on the Leased Premises. "Gross Sales Receipts" shall not include: G~ROUND LEASE AGREEMENT (i) The amount of any sales, use or gross receipts tax imposed by federal, state municipal or other governmental authority directly on sales and collected from customers, provided that the amounts thereof are added to the sales price, or absorbed therein, and pa/d by Lessee to such governmental authority. (ii) Service charges, which are defined to mean percentage gratuities added to customer billings as compensation to Lessee's employees. (iii) Proceeds received by Lessee as the result of an insurable loss on the Leased Premises. (iv) Amounts charged to Lessee by credit card companies for processing credit card charges made on the Leased Premises. K. Initial Term: The term "Initial Term" shall mean a period beginning on the Lease Commencement Date and ending twenty-five (25) years after the Rent Commencement Date, subject to amendment of the term of the Corps Lease to coincide therewith. L. Leased Premises: The term "12.ased Premises" shall mean that real property consisting, of approximately sixty (60) acres, more or less, located above the 522 foot elevation in the Stewart Creek Park Parcel, Lewisville Lake Project, Denton County, Texas, and being identified as the "Golfing Facility I~ased Premises" on ~ attached hereto. On or before the Rental Commencement Date, Lessee shall furnish to Lessor, for Lessor's approval, a metes and bounds legal description of the Leased Premises. Upon approval in writing by Lessor of such metes and bounds legal GROUND LEASE AGREEMENT description, such description shall be substituted as the description of the Leased Premises for purposes of this Lease. M. Lessee: The term Lessee shall mean Peninsula Golf Associates. N. Lessor: The term ~Lessor" shall mean City of The Colony, a Texas municipal corporation. 0. Off-Premises Roadway: The term "Off-Premises Roadway,, shall mean that portion of the main roadway which provides access to the Leased Premises, but which is not located on the Leased Premises, as shown on Exhibit "A~ attached hereto and incorporated herein by reference. P' On-Premises Roadway: The term ~On-Premises Roadway', shall mean that portion of the main roadway which provides access to the Leased Premises, but which is located on the Leased Premises, as shown on Exhibit "A~ attached hereto and incorporated herein by reference. ARTICLE 2. DEMISE OF LEASED PREMISES Lessor, for and in consideration of the rents, covenants and promises herein contained to be kept, performed and observed by Lessee, has demised and leased and by these presents does hereby demise and lease unto Lessee on an exclusive basis, and Lessee, for and in consideration of the covenants and agreements herein reserved on the part of the Lessor to be kept and performed, does hereby rent and accept from Lessor, the Leased Premises, subject to (i) all terms and Conditions of the Corps Lease and (ii) all other matters of record in any way appertaining to the Leased Premises. Lessee acknowledges that it has inspected the Leased GROUND LEASE AGREEMENT Premises to its complete satisfaction and accepts the Leased Premises "As Is" without representation or warranty of any kind from Lessor as to the status or condition thereof, except Lessor warrants that it (i) is the Lessee under the Corps Lease, (ii) has not previously assigned its rights under or entered into a sublease with respect to the Corps Lease, and (iii) has the absolute right to enter into this Lease Agreement. ARTICLE 3. LEASE TERM Commencement Date and Lease Term 3.01 Subject to the further terms and conditions of this Lease, the demise set forth in Article 2 above shall be for the Initial Term. The parties agree to execute, acknowledge and deliver a mutually acceptable form of Memorandum of Lease within ninety (90) days after the Lease Commencement Date, which will be recorded in the real property records of Denton County, Texas. 3.02 This Lease shall terminate and become null and void without further notice on the later expiration of the Initial Term or the Extended Term, as the case may be, or upon the earlier revocation of the Corps Lease. Any holding over by Lessee after the expiration of said term shall not constitute a renewal hereof or give Lessee any rights hereunder in or to the Leased Premises. Upon termination of this Lease, all improvements to the Leased Premises (whether or not constructed by Lessee) shall be and become the property of Lessor. ARTICLE 4. RENT 4.01 During the Initial Term and any Extended Term of this Lease, Lessee shall pay rents to the Lessor as follows: ~GROUND LEASE AGREEMENT (1) Minimum Rent. Lessee agrees to pay to Lessor as fixed minimum rent the sum of $10,000.00 per Lease Year, payable in advance commencing on the Rent Commencement Date and continuing on each successive anniversary thereof during the term of this Lease. (2) ~. In addition to the Minimum Rent provided for above, Lessee shall also pay, during Lease Years nine (9) through fifteen (15), percentage rent equal to three percent (~*%)of Net ~ings in excess of Three Hundred Thirty Three Thousand~ Three Hundred Thirty Four and No/100 Dollars ($333,334.00). During Lease Years sixteen ~!gJ)~/hrOugh the end of the term of thiV Lease (and an . · Lessee shall pay percentage rent equal to el-'- Y extensions thereof), Oti~-v/.t · gut perce;~l,i~8~).of~Net ~ings in excess~of ~tired ~enty FiVe Thousand and No/100 Dollars ($f25,000.00). For purposes hereof, ~Net Earnings,, shall mean Lessee's Gross Sales Receipts less all of Lessee's ex~ penses of operating and maintaining the Golfing Facility and the Leased Premises, including without limitation, debt service, taxes and reserves established by Lessee for capital replacements and repairs (Such reserve not to exceed 1% of Gross Sales Receipts per Lease Year), but excluding (a) non-cash expenses such as depreciation and expenses paid from previously established reserves deducted in calculating Net Earnings. Net Earnings shall otherwise be calculated in accordance with generally accepted accounting Principles, and distributions of income or profit to partners or affiliates of Lessee shall not be deducted in calculating Net Earnings. For purposes of the preceding sentence, "affiliates" shall mean persons or entities which control, are controlled by or are under common control with Lessee. GROUND LEASE AGREEMENT Books and Records 4.02. Lessee agrees to maintain a complete set of books and records, keep and tnaintained in accordance with generally accepted accounting practices and procedures. Said books and records shall be at all reasonable times be available for inspection and exam/nation by Lessor or by properly designated employees or agent's of Lessor or by the District Engineer. Lessee's Statements 4.03 Within one hundred twenty (120) days after the close of the ninth (9th) Lease Year and each successive Lease Year thereafter, Lessee shall deliver to Lessor an operating statement showing Lessee's Gross Sales Receipts and expenses incurred in calculating Net Earnings for the Preceding Lease Year, and make payment of all percentage rentals, if any, due for said preceding Lease Year. ARTICLE 5.0 TAXES 5.01 Lessee shall pay and discharge all taxes, general and special assessments and other similar charges which · · dunng either the Initial Term or the Extended Term may be levied on or assessed against the Leased Premises and all interests therein and all improvements and other property, including personal property thereon, owned by Lessee. Lessee shall pay ail such taxes, charges and assessments to the public officer charged with the collection thereof not less than fifteen (15) days before the same shall become delinquent, and Lessee agrees to indemnify and save harmless Lessor from all such taxes, charges and assessments. Lessee shall have the right in good faith at its sole cost and expense (in its own name or in the name of Lessor, or both, as Lessee may determine appropriate) to contest any such taxes, charges and assessments GROUND LEASE AGREEMENT and shall be obligated to pay the contested amount only if and when finally determined to be due. Payment by Lessor 5.02 Subject to the right of the Lessee to contest taxes, assessments and governmental charges as hereinabove provided, Lessor may, at any time that the payment of any item of taxes, special assessments or governmental charges which Lessee is obligated to pay under the provisions of Section 5.01 remains unpaid, give written notice to Lessee of its default and if Lessee continues to fail to pay such item of taxes, special assessments or governmental charges or to contest the same in good faith, then at any time after ten (10) days from the date of such written notice Lessor may pay the items specified in the nofce and Lessee covenants thereupon on demand to reimburse Lessor any amount so paid or expended in the payment of the items specified in the notice, with interest thereon at the Floating Rate (as hereinafter defined) from the date of such payment by Lessor until repaid by Lessee. Provided however, if Lessor, without giving the ten (10) days notice above provided for, pays any such item which has not been paid by Lessee within the time required in Section 5.01, or which has not then or thereafter been successfully contested by Lessee, Lessee shall nevertheless reimburse Lessor for such item, but without interest. The term "Floating Rate" shall mean the greater of (a) the annual rate of interest from time to time published or announced by Citibank, N.A., New York, New York, as its prime or base commercial lending rate, or if Citibank, N.A. (or any other money center bank selected pursuant to this sentence) shall ever cease to exist or announce a prime or base commercial lending rate, then the annual rate of interest from time to time announced by a New GROUND LEASE AGREEMENT Page 9 York money center bank selected by Lessor as its prime or base commercial lending rate, or (b) the annual rate of interest then being paid by the City on its unsecured borrowings. ARTICLE 6. UTILITIES Lessee shall pay or cause to be paid all charges for water, heat, gas., electricity, sewer, and any and all other utilities used by Lessee on the Leased Premises throughout the Initial Term and any Extended Term of this Lease, including any connection fee. Lessor must make available electricity, sewer and water access to the Leased Premises when such services are extended to the area adjacent to the Leased Premises. ARTICLE 7. USE OF LEASED PREMISES Lessee shall use the Leased Premises exclusively for the purpose of operating the Golfing Facility open to the public for use on a daily fee paying basis, t0g~?.with ~y ~d all ~ther* auxi~iar3, uses relate~ ,to :such prim~ use, subject~ to the t8rms and conditions of the Corps Lease. ARTICLE 8. CONSTRUCTION BY LESSEE 8.01 Lessee shall have the right at any time and from time to time during the Initial Term and the Extended Term of this Lease, provided prior approval of the District Engineer is obtained and at Lessee's sole cost and expense, to erect, maintain, alter, remodel, reconstruct rebuild, replace and remove buildings and other improvements on the Leased Premises, and correct and change the contour of the Leased Premises, subject to the following general conditions: GROUND LEASE AGREEMENT Page 10 (1) The cost of any such construction, reconstruction, demolition or of any change, alteration or improvements, shall be borne and paid for by the Lessee. (2) The Leased Premises shall at all times be kept free of mechanic's and materialmen's liens. Easements and Dedications 8.02 [This section intentionally left blank.] Approval of Plans by Lessor and the Corps 8.03 (1) No structure or other material improvement, the plans, specification and proposed location of which have not first received the written approval of Lessor and the Corps, or which do not comply with such approved plans, specifications and locations, shall be constructed or maintained on the Leased Premises. No material addition to or alteration of any building or structure erected on the Leased Premises shall be commenced unless and until plans and specifications of the proposed addition or alteration shall have been first submitted to and approved by Lessor and the Corps. Submission of Plans (2) Within 120 days from the Lease Commencement Date, Lessee shall, at its own expense, prepare or cause to be prepared, plans and specifications for the construction of the Golfing Facility and shall submit to Lessor three (3) copies and to the Corps one (1) copy of detailed preliminary drawings, plans and specifications for the review and approval of the Lessor and the Corps. GROUND LEASE AGREEMENT Page 11 Approval by Lessee and the Corps (3) Lessor and the Corps will promptly review and approve the plans or note in writing any required changes or corrections which must be made to the plans. Approval cannot be unreasonably withheld or delayed. In the event that Lessee shall determine that any required changes are unacceptable, then Lessee may declare this Lease to be of no further force and effect and Lessee shall be deemed released from all further liability hereunder. If any said changes are acceptable, Lessee shall make such required changes or corrections in a prompt and orderly fashion and resubmit three (3) sets of the plans for review and approval to Lessor and one (1) set to the Corps. (4) The following items do not require submissions to, or approval of plans and specifications by, Lessor and/or the Corps: (a) Such minor repairs and alterations as may be necessary to maintain existing structures and improvements in a useful state of repair and operation; and (b) Such changes and alterations, either at the time of the original construction or thereafter, as may be required by an authorized public official having authority or jurisdiction over such structures or improvements, in order to comply with legal requirements. Effect of Approval (5) Neither Lessor nor the Corps, by approving such plans and specifications, assume any liability or responsibility therefor or for any defect in any structure constructed from such plans and specifications. GROUND LEASE AGREEMENT Page 12 Commencement of Construction 8.04 Lessor shall cause the commencement of construction of the Golfing Facility within twelve (12) months after the date on which the Corps approves this Lease pursuant to Article 23, and shall thereafter proceed with the construction of the Golfing Facility to completion in a due and diligent manner. ARTICLE 9. ENCUMBRANCE OF LEASEHOLD ESTATE 9.01 Lessee may, at any time and from time to time, encumber the Lessee's interests in the leasehold estate by deed of trust, mortgage or other security instrument, provided Lessee has first obtained the written approval of such encumbrance from Lessor, which approval shall not be unreasonably withheld, but no such encumbrance shall constitute a lien on the fee title to the Leased Premises, and the indebtedness secured thereby shall at all times be and remain inferior and subordinate to all the conditions, covenants and obligations of this Lease and to ail of the rights of the Lessor hereunder. The holder of indebtedness secured by a mortgage or deed of trust approved pursuant to this Section 9.01 is hereinafter called a "Lienholder." Notices to Lienholders 9.02 If at any time after execution and recordation in Denton County, Texas, of any such mortgage or deed of trust the Lienholder shall notify Lessor in writing that any such mortgage or deed of trust has been given and executed by Lessee and shall at the same time furnish Lessor with the address to which the Lienholder desires copies of notices to be mailed, Lessor hereby agrees that it will thereafter mall to such Lienholder, at the address so GROUND LEASE AGREEMENT Page 13 given, duplicate copies of any and ail notices in writing which Lessor may from time to time give or serve upon Lessee under and pursuant to the terms and provisions of this Lease. Lienholder Protection Provisions 9.03 Any Lienholder shail have the right, but not the obligation prior to execution of a written assumption, to pay and perform any and ail obligations of Lessee under this Lease, and Lessor agrees to accept payment or performance by any Lienholder of such obligations as if payment or performance had been made by Lessee. In the event of a foreclosure under a mortgage or deed of trust given for the benefit of a Lienholder or an assignment by Lessee of the leasehold estate created by this Lease in lieu of a foreclosure, and provided no uncured default by Lessee then exists under this Lease, Lessor agrees to recognize the purchaser at such foreclosure sale or such assignee as the lessee under this Lease for all purposes as if such party was identified in this Lease as the "Lessee." Upon receipt of written request from such purchaser or assignee, Lessor shall execute and deliver a written document acknowledging such purchaser or assignee as the Lessee under this Lease. ARTICLE 10. REPAIRS, RESTORATION AND MAINTENANCE Lessee's Duties to Repair 10.01 Lessee, at Lessee's own cost and expense at all times during either the initial Term or the Extended Term, agrees to keep and maintain, or cause to be kept and main- tained, all buildings and improvements which may be erected on the Leased Premises in a good state of appearance and repair, reasonable wear and tear excepted. GROUND LEASE AGREEMENT Page 14 Damage or Destruction - Repair 10.02 In the event any building or improvements hereafter constructed on the Leased Premises is damaged by fire or any other casualty, regardless of the extent of such damage or destruction, Lessee shall within ninety (90) days from the date of such damage or destruction, commence the work of repair, reconstruction, or replacement of the damaged or destroyed building or improvement and prosecute the same with reasonable diligence so that the building to the extent originally constructed by Lessee, shall be restored to substantially the condition it was in prior to the happening of the casualty, provided, however, that if the commencement, construction or completion of said repair, reconstruction or replacement work shall be prevented or delayed by reason of war, civil commotion, acts of God, strikes, governmental restriction or regulations, or interferences, fire or other casualty or any other reason beyond the control of the Lessee whether similar to any of those enumerated or not, the time for the commencing or completing, or both, or the construction of said building, as the case may be shall automatically be extended for the period of such delay. Mechanic's Liens 10.03 (1) Lessee shall not suffer or permit any mechanic's liens or other liens to be filed against the fee of the Leased Premises nor against Lessee's leasehold interest in the land nor any buildings or improvements on the Leased Premises by reason of any work, labor, services or materials supplied or claimed to have been supplied to Lessee or to anyone holding the Leased Premises or any part thereof through or under Lessee. GROUND LEASE AGREEMENT Pa~e 15 (2) If any such mechanic's lien or materialmen's liens shall be recorded against the Leased Premises, or any improvements thereon, Lessee shall cause the same to be removed or, in the alternative, if Lessee in good faith desires to contest the same, Lessee shall be privileged to do so, but in such case Lessee hereby agrees to provide a surety bond, or other collateral, acceptable to Lessor and to indemnify and save Lessor harmless from all liability for damages occasioned thereby and shall, in the event of a judgment of foreclosure on said mechanic's liens, cause the same to be discharged and removed prior to the execution of such judgment. Restoration 10.04 Upon the expiration or earlier termination of this Lease, Lessee shall vacate the Leased Premises, remove all of Lessee's personal property from the Leased Premises, and, if Lessee, without obtaining any approvals from Lessor or the Corps required by this Lease, has made any unauthorized improvements to the Leased Premises ("Unauthorized Improvements"), Lessee shall, at the option of the Lessor and the Corps, restore the Leased Premises so as to remove the Unauthorized Improvements. If Lessee shall fail or neglect to remove said personal property or perform any restoration required by the preceding provisions of this Section 10.04, then, at the option of the Lessor, Lessor may cause such restoration to be performed and said personal property shall either become the property of the Lessor without compensation therefor, or the Lessor may cause the personal property to be removed, and no claim for damages against the Lessor or its officials or agents shall be created by or made on account of such removal and GROUND LEASE AGREEMENT Pa~e 16 restoration work. Lessee shall also pay Lessor on demand any sum which may be expended by in performing such restoration of the Leased Premises. ARTICLE 1 I. MAINTENANCE OF ROADWAYS 11.01 Lessee shall have the responsibility for maintenance of the On-Premises Roadway and the Off-Premises Roadway until such time as the City of The Colony accepts a dedication thereof, at which time Lessee's maintenance obligation shall cease as to the Off-Premises Roadway only. The On-Premises Roadway and the Off-Premises Roadway are shown on Exhibit "A" attached hereto and are designated as to the maintenance responsibilities. ARTICLE 12. WATER RIGHTS AND USAGE 12.01 Lessor hereby grants to Lessee, during the term of this Lease, all rights which Lessor has or may have, by virtue of the Corps I.ease or otherwise, to the use of surface water and ground water on the Leased Premises. ~h~l~fil!ed:or~g~Pi0g equipm~ti~stalled ~:~fior~written approVal~ibf~I~SOr ~d th~ District-Eng~e~r. Title to all permitted pumping equipment not removed by Lessee prior thereto shall pass to Lessor upon termination of this Lease. 12.02 In addition to the grant set forth in Section 12.01 above, Lessor hereby agrees to use Lessor's best efforts to assist Lessee to the extent reasonably possible to obtain permission of the City of Dallas, Texas, and/or any other governmental body or agency having jurisdiction thereof, to withdraw untreated water from Lake Lewisville for irrigation purposes on the Leased Premises upon the most favorable rates charged by the City of Dallas. It is agreed, however, that in the exercise of its "best efforts", Lessor shall not be required to make any expenditures GROUND LEASE AGREEMENT Page 17 and all costs related to obtaining such permission to withdraw untreated water, and all costs for water actually withdrawn after obtaining such permission, shall be borne by and be the sole responsibility or Lessee. 12.03 Lessor covenants and represents to Lessee that potable, treated water from Lessor's water system is, or shall be, available, during the term of this Lease, for Lessee's general use at the Golfing Facility to be constructed on the Leased Premises, said water to be provided at the most favorable rates charged by Lessor to third parties using equivalent quantifies of water for commercial purposes. Lessee shall be responsible for, and bear the cost of, construction of water lines to the Leased Premises at such time as the City water supply is extended to the Leased Premises. 12.04 Lessee shall be responsible for construction,, maintenance and repair of the water systems and equipment utilized on the Leased Premises, and, except as to the potable, treated water to be provided under Section 12.03 above, shall further be responsible for insuring compliance with all state and local laws governing water quality and testing. ARTICLE 13. ACCESS TO PROPERTY Lessor and Lessee mutually agree that land access to the Leased Premises shall be desig- nated and shown on Exhibit "A' attached hereto and made a part hereof. Lessee, through its employees, shall have sole responsibility for allowing access to the Leased Premises by unlocking the access gates each morning and shall further have sole responsibility for securing the Leased Premises by locking the access gate each evening. Lessee further agrees that Lessor's police department and fire department shall be provided with duplicate keys to GROUND LEASE AGREEMENT Page 18 the access gates for use in obtaining access to the Leased Premises for security patrols and in emergency situations. Designated representatives from the local governmental authorities and the Corps shall have the right to enter upon the Leased Premises for the purposes of inspecting the land and facilities. ARTICLE 14. (INTENTIONALLY DELETED) ARTICLE 15. INSURANCE AND INDEMNIFICATION Insurance 15.01 (1) During the period of construction of any building or other improvement on the Leased Premises and at all times thereafter during the Lease Term, Lessee shall keep the improvements insured against loss or damage by fire, with extended coverage endorsement or its equivalent in such responsible insurance companies, having a minimum Best's Rating of A, as Lessee shall select. Lessee will provide to Lessor a Certificate of Insurance evidencing such coverage. Insurance must be in amounts not less than eighty percent (80%) of the fair insurance value of the buildings and other improvements. Such policy or policies of insurance shall name Lessee as a named insured. Any time there is a lien on the leasehold estate complying with the provisions of Article 9 hereof, said insurance, at Lessee's option, may contain a loss payable clause in favor of any mortgagee or trustee in connection with any such mortgage or lien under the terms of which any proceeds will be payable solely to such mortgagee or trustee. All such insurance shall be issued by companies as required by any such mortgagee or trustee, or if not so required, reasonably acceptable to any such mortgagee or trustee. GROUND LEASE AGREEMENT Page (2) Lessee, at its own expense, agrees to provide and keep in force during this I_ease, comprehensive general liability and property damage liability insurance covering Lessee and any of Lessee's contractors, with Lessor as an additional insured, with one or more responsible insurance companies having a minimum Best's rating of A and duly authorized to transact business in Texas. The property damage liability insurance shall be in an amount of not less than One Million Dollars ($1,000,000.00) combined single limit per occurrence. (3) Lessee agrees at its own cost and expense to obtain and maintain workers' compensation insurance during the term of this Lease and, at all times when demolition, excavation or construction work is in progress on the Leased Premises, construction liability insurance with responsible insurance companies having a minimum Best's rating of A and duly authorized to transact business in Texas, with limits of One Million Dollars ($I ,000,000.00) for damages to persons and One Hundred Thousand Dollars ($100,000.00) property damage, protecting Lessee, as well as such other person or persons as Lessee may designate, against any and all liability for injury or damage to any person or property in any way arising out of such demolition, excavation or construction work. (4) Lessee shall furnish Lessor and the District Engineer with certificates of all insurance required by this Article. All such insurance certificates shall require thirty (30) days notice from the insurer to Lessor of cancellation, amendment or non-renewal. Lessee agrees that if it does not keep such insurance in full force and effect that Lessor may notice Lessee of such failure and if Lessee does not deliver to Lessor within ten (10) days after such notice certificates showing all such insurance to be in full force and effect, Lessor may, at its option, take out all GROUND LEASE AGREEMENT Page 20 necessary insurance to comply with the provisions hereof and pay the premiums on the items specified in such notice and Lessee covenants thereupon on demand to reimburse and pay Lessor any amount so paid or expended in the payment of the insurance premiums required hereby and specified in the notices, with interest thereon at the Floating Rate (as defined in Section 5.02) from the date of such payment by Lessor until repaid by Lessee. 15.02 Lessee agrees to indemnify and hold harmless Lessor, its officers, agents, employees and elected officials, the Corps, its officers, agents and employees (collectively, the "Indemnified Parties") from and against any and all liability, loss, cost or expense (including attorney's fees and court costs) arising out of the use and operation of the Leased Premises, except for any such liability, loss, cost or expense which is attributable to the gross negligence or willful misconduct of the Indemnified Parties. ARTICLE 16. ASSIGNMENT AND SUBLEASE Lessee may not sell or assign its leasehold estate in its entirety or any portion of the unexpired term thereof, and may not sublet the Leased Premises or any portion of the same or any portion of any building erected on said Leased Premises at any time and from time to time, without having first obtained the express written approval of Lessor and the District Engineer, which approval shall not be unreasonably withheld. It is agreed that any such transfer, assignment or sale shall release Lessee from its obligations hereunder. ARTICLE 17. DEFAULT AND REMEDIES 17.01 Any of the following occurrences or acts shall constitute an event of default under this GROUND LEASE AGREEMENT Page 21 (a) if Lessee shall (i) default in making payment when due of any rent or any other amount payable by Lessee to Lessor hereunder; or (ii) default in the observance or performance of any other provisions of this Lease to be observed or performed by Lessee hereunder; or (iii) following commencement of construction of the Golfing Facility, abandon the Leased Premises (failure to occupy and operate the Leased Premises for ten (10) consecutive days shall be deemed an abandonmen0; and if such default shall continue as to subsections (i) and (ii) above for ten (10) days or as to subsection (iii) above for thirty (30) days, in each case after Lessor shall have given to Lessee, and any Lienholder as required by Section 9.02 above, written notice specifying such default and demanding that the same be cured, or, with respect to a default under subsection (iii), if by reason of the nature thereof such default cannot be cured by the payment of money and cannot with due diligence be wholly cured within such period of thirty (30) days, if Lessee shall fail to proceed promptly to cure the same and thereafter prosecute the curing of such default with all due diligence, it being intended in connection with a default not susceptible of being wholly cured with due diligence within such period that the time within which to cure the same shall be extended for such period as may be necessary to complete the curing of same with all due diligence, but in no event longer than sixty (60) days; or (b) if Lessee shall fail to commence or complete the construction of improvements to the Leased Premises in accordance with the concept plan approved by Lessor; GROUND LEASE AGREEMENT Page 2?, (c) if Lessee shall commence any activity requiring prior consent of Lessor pursuant to this Lease without first having obtained such consent; (d) if Lessee shall make a general assignment for the benefit of creditors, or shall file a petition in bankruptcy, or shall be adjudicated, bankrupt or insolvent, or shall file a petition seeking any reorganization, arrangement, composition readjustment, liquidation, dissolution or similar relief under any present or future statute, law or regulation, or shall file an answer admitting or shall fail reasonably to contest the material allegations of a petition filed against it in any such proceeding, or shall seek or consent to or acquiesce in the appointment of any trustee, receiver or liquidator of Lessee or any material part of its properties; or (e) if, within ninety (90) days after commencement of any proceeding against Lessee seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any present or future statute, law or regulation, such proceeding shall not have been dismissed, or within ninety (90) days after the appointment without the consent or acquiesce by Lessee, of any trustee, receiver or liquidator of Lessee or of any material part of its properties, such appointment shall not have been vacated; or (f) if a final judgment for the payment of money in any material amount shall be rendered against Lessee and within sixty (60) days after the entry thereof, such judgment shall not have been discharged or execution thereof stayed pending appeal, or if within sixty (60) days after the expiration of such stay, such judgment shall not have been discharged. 17.02 In the event of any default by Lessee as defined hereinabove which default remains uncured after the respective period set forth above, Lessor may declare this Lease, and all rights GROUND LEASE AGREEMENT Page 23 and interest created by it, to be terminated. Upon Lessor electing to terminate, this Lease shall cease and come to an end as if that were the day originally filed herein for the expiration of the term hereof. Lessor, its agent or attorney, may resume possession of the Leased Premises and re-let the same for the remainder of the term at the best rent Lessor, its agent or attorney, may obtain; provided, however, except as provided in Section 17.03 and 24.08 hereof, Lessee shall have no obligations to make good any deficiency. Other Remedies 17.03 Any termination of this Lease as a result of a default by Lessee pursuant to Section 17.01 shall not relieve Lessee from the payment of any sum or sums that shall then be due and payable to Lessor hereunder or for any claim for such damages theretofore accruing against Lessee hereunder and any such termination shall not prevent Lessor from enforcing the payment of any such sum or sums or claim for damages by any remedy provided for by law. All rights, options and remedies of Lessor contained in this Lease shall be construed and held to be cumulative, and no one of them shall be exclusive of the other, and Lessor shall have the right to pursue any one or all of such remedies or any other remedy or relief which may be provided by law whether or not stated in this Lease. No waiver by Lessor of a breach of any of the covenants, conditions or restriction of this Lease shall be construed or held to be a waiver of any succeeding or preceding breach of the same or any other covenant, condition or reconstruction herein continued. GROUND LEASE AGREEMENT Pace 24 ARTICLE 18. OPTION TO EXTEND 18.01 Lessee shall have the option to extend this Lease for the Extended Term provided the Corps Lease is extended as defined in Article 1 and further provided that Lessee shall not be in default in the performance of any of its obligations under this Lease on the date of exercise of such option or the date of commencement of the Extended Term. Lessee shall be deemed to have automatically exercised such option unless Lessee delivers written notice to Lessor that Lessee will not exercise its option, which notice must be sent at least one hundred eighty (180) days prior to the expiration of the Initial Term. Lessee's use and occupancy of the Leased Premises during the Extended Term shall be subject to and governed by all applicable covenants. agreements, terms and provisions and conditions herein set forth. ARTICLE 19. ARBITRATION [INTENTIONALLY DELETED] ARTICLE 20. COVENANTS AND WARRANTIES 20.01 Lessor hereby represents and warrants that it is the Lessee under a lease between Lessor and the Corps and that, pursuant thereto, it has the full power and authority to enter into this Lease subject to the Corps' right of approval of the terms set forth herein. 20.02 Lessor covenants and agrees that Lessee on paying the rent and other charges herein provided for and observing and keeping the covenants, conditions, and terms of this Lease on Lessee's part to be kept or performed, shall lawfully and quietly hold, occupy, and enjoy the Leased Premises during the term of this Lease without hindrance or molestation of Lessor or any other person claiming under Lessor, except such portion of the Leased Premises, if any, as shall GROUND LEASE AGREEMENT Page be taken under the power of eminent domain. Provided Lessee is not in default pursuant to the provisions of Section 17.01 of this Lease, Lessor shall pay and perform each of its obligations under the Corps Lease in a timely manner. 20.03 Lessee covenants and agrees that the Golfing Facility to be constructed and operated on the Leased Premises shall be open to and for use by the general public and that Lessee or its concessionaires shall not discriminate against any person or persons or exclude any persons from participation in and use of the Golfing Facility or any other programs or activities conducted on the Leased Premises because of race, color, age, sex, handicap, national origin or religion. Lessee, by acceptance of this Lease, hereby gives assurances that Title VI of the Civil Rights Act of 1964 (Public Law 88-352) and all requirements imposed by or pursuant to the Directive of the Department of Defense (32) CFR. Part 300 issued as Department or Defense Directive 5500.11.27 May 1971) will be complied with. 20.04 Lessee covenants and agrees that it shall comply with all laws, ordinances, rules and regulations of municipal, state, federal and other agencies or bodies, including, but not being limited to, environmental laws, having jurisdiction thereof relating to the construction, use, condition or occupancy of the Golfing Facility on the Leased Premises and the use of all personal property used in or related to the operation of such Golfing Facility. Without limiting the foregoing, Lessee expressly covenants and agrees that all buildings and other improvements constructed on the Leased Premises shall be constructed in accordance with the building codes and regulations and inspection procedures imposed by Lessor on commercial construction within Lessor's municipal boundaries. GROUND LEASE AGREEMENT Page 26 ARTICLE 21. GENERAL PROTECTIVE PROVISION Relationship Between Parties 21.01 The relationship between Lessor and Lessee at all times shail remain solely that of landlord and tenant and not be deemed to be a partnership or joint venture. Force Majeure 21.02 It is expressly understood and agreed that if commencement of construction of the Golfing Facility or the completion of the same or the curing of any default (other than failure to pay rent, insurance premiums, or ad valorem taxes) or the performance of any other covenant, agreement, obligation or undertaking herein contained is delayed by reason of war, civil commotion, act of God, governmental restrictions, regulations or interferences, fires or other casuaity or any circumstances beyond Lessee's control or beyond the control of the party obligated or permitted under the terms hereof to do or perform the same, regardless of whether any such circumstances are similar to any of those enumerated or not, each party shail be excused from doing or performing the same during such period of delay. No Waiver 21.03 No waiver by Lessor of any default or breach of any covenant, condition, or stipulation herein contained shall be treated as a waiver of any subsequent default or breach of the same or any other covenant, condition, or stipulation hereof. Use Clause 21.04 Lessee agrees not to use the Leased Premises or any building situated upon said Leased Premises, or any part thereof for any use or purpose in violation of any vaiid and GROUND LEASE AGREEMENT Pa~e 27 applicable law, regulation, or ordinance of the United States, the State of Texas or the City of the Colony, Texas, or other lawful authority having jurisdiction over the Leased Premises. ARTICLE 22. SUBORDINATION TO CORPS LEASE 22.01 Lessor and Lessee mutually acknowledge and agree that this Lease, and the respective rights and obligations of Lessor and Lessee hereunder, is now and shall at all times hereafter be subject and subordinate to the terms and conditions of the Corps Lease. Lessor further agrees that in the event the Corps terminates the rights of the Lessor with respect to the Leased Premises under the terms of the Corps Lease, then Lessee has the right, if it is not then in default pursuant to Section 17.01 of this Lease, to negotiate directly with the Corps. Nothing contained in this Section 22.01 shall relieve Lessor of its obligations and covenants contained in Section 20.02. ARTICLE 23. APPROVAL BY CORPS 23.01 (1) Lessor and Lessee hereby agree and acknowledge that this Lease and the terms and conditions set forth herein are subject to the review and approval of the Corps. Lessor and Lessee further agree and acknowledge that the respective rights and obligations of Lessor and Lessee are conditioned upon the Corps granting its approval to this Lease and all the terms and conditions set forth herein. Lessor and Lessee agree that in the event the Corps has failed to give its approval to this Lease within one hundred eighty (180) days after the date of execution, or if the Corps shall disapprove this Lease and no further avenues of appeal are available, either party may elect to terminate this Lease by giving at least ten (10) days prior written notice of termination to the other party, lJnless the parties shall thereafter execute a new written GROUND LEASE AGREEMENT Paee 28 agreement to the contrary, this Lease shall terminate on the date set forth in the notice and neither party shall thereafter have any further obligations to the other. (2) Additionally, Lessor and Lessee acknowledge that certain provisions of the Corps Lease will make it difficult or impossible to obtain institutional equity or financing for development of the Golfing Facility secured by a mortgage or deed of trust covering Lessee's leasehold estate created pursuant to this Lease. Lessee and Lessor agree to use their good faith efforts to negotiate revisions to the Corps Lease or obtain other documents from the Corps which will provide assurances to Lessee and its prospective lenders and equity sources that (a) any past and future failures to satisfy requirements of the general development plan under the Corps Lease relating to property other than the Leased Premises will not result in a termination of the Corps Lease, as it relates to the Leased Premises, Co) the Initial Term and Extended Term will match the lease term described in the Corps Le~se, (c) only revenues generated on the Leased Premises and paid to Lessor are subject to the provisions of paragraph 6 of the Corps Lease, and (d) the Corps will grant Lienholders notice and cure rights and protections similar to those granted to Lienholders by Lessor pursuant to Sections 9.02 and 9.03. In the event Lessee and Lessor are unable to negotiate mutually acceptable revisions or other documents with the Corps on or before the end of the three hundred (300) day period identified in the second recital paragraph of this Lease, then Lessee shall have the right to terminate this Lease by delivering written notice to this effect to Lessor and thereafter, neither party shall have any obligations to the other under this Lease. GROUND LEASE AGREEMENT Page 29 ARTICLE 24. MISCELLANEOUS Delivery of Rents and Notice 24.01 All rents or other sums, notices, demands, or requests from one party to another may be personally delivered or sent by United States mail, certified, or registered, postage prepaid, to the addresses stated in this paragraph. If to Lessor: The City of The Colony P.O. Box 560008 The Colony, Texas 75056-0008 Attn: If to Lessee: Peninsula Golf Associates, Ltd. 4809 Cole Avenue, Suite 145 LB #123 Dallas, Texas 75205 Notice shall be deemed to have been given (i) if by hand delivery, at the time of delivery, or (ii) if mailed, seventy-two (72) hours after the deposit of same in any United States mail post office box in the State to which the notice is addressed or ninety-six (96) hours after the deposit in any such post office box in other than the State to which the notice is addressed, postage paid, addressed as set forth above. The addresses and addressees for the purpose of this paragraph may be changed by giving notice of such change in the manner herein provided for giving notice. Unless and until such written notice is received the last addresses and addressee stated by written notice, or provided herein if no written notice of change has been sent or received, shall be deemed to continue in effect for all purposes hereunder. GROUND LEASE AGREEMENT Page 30 Parties Bound 24.02 This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors and assigns where permitted by this Agreement. Texas Law to Apply 24.03 This Agreement shall be construed under and in accordance with the laws of the State of Texas, and all obligations of the parties created hereunder are performable in Denton County, Texas. Severability 24.04 In case of any one or more of the provisions contained in this Agreement shall f or any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision hereof and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. Prior Agreements Superseded 24.05 This Agreement constitutes the sole and only agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties respecting the within subject matter. GROUND LEASE AGREEMENT Page 31 Amendment 24.06 No amendment, modification or alteration of the terms hereof shall be binding unless the same be in writing, dated subsequent to the date hereof and duly executed by the parties hereto, and approved in writing by the District Engineer. Rights and Remedies Cumulative 24.07 The rights and remedies provided by this Lease are cumulative and the use of any one right or remedy by either party shall not preclude or waive its fight to use any or all other remedies. Said fights and remedies are given in addition to any other fights the parties may have by law statute, ordinance, or otherwise. Attorney's Fees 24.08 In the event Lessor or Lessee breaches any of the terms of this Agreement whereby the party not in default employs attorneys to protect or enforce its fights hereunder and prevails, then the defaulting party agrees to pay the other party reasonable attorney's fees so incurred by such other party. Lessee shall reimburse Lessor on demand for all reasonable fees and expenses (including attorneys fees) which it incurs in connection with the seeking and obtaining of permits and approvals required of Lessor hereunder. Lessor or its attorney shall advise Lessee in advance of incurring such fees or expenses, of the approximate amount of said fees or expenses and shall obtain Lessee's approval for said expenditures before incurring same. Time of Essence 24.09 Time is of the essence in this Lease. GROUND LEASE AGREEMENT Page 32 Further Documents 24.10 Lessor agrees that it will from time to time and at any reasonable time execute and deliver to Lessee such other and further instruments and assurances as Lessee may reasonably request approving, ratifying, and confirming this Lease and the leasehold estate created hereby and certifying that the same is in full force and effect and that no default on the part of Lessee exists, or if any such default does exist, Lessor shall specify in said certificate each such default. IN WITNESS WHEREOF, the parties have caused this Lease to be executed in multiple counterparts each of which shall have the full force and effect of an original, by their respective duly authorized representatives on the day and year first set forth above. LESSOR: THE CITY OF THE COLONY Its: /?7/9~9/~ ~ ~ LESSEE: PENINSULA GOLF ASSOCIATES, LTD., a Texas limited partnership By: ~t~,~ ~ ~5., its general partner GROUND LEASE AGREEMENT Page 33 EXHIBIT "A" 1'- 1200' ON-BiTE ON-BITE RQAOW/~Y ROADWAY GOLFING FACILITY LEASED PREMISES i. :.~' (APPROX, 60 AC) LAKE LEWlSVlLLE CREEK PARK PARCEL (APPROX. 130 AC) STEWART PENINSULA THE COLONY, TEXAS NOV. 2~, "ISB4 dEPARTMENT OF THE ARMY P. O. ~OX 17~ FORT WORTH, T[XA~ 76~OZ-0300 ~' July 5, 1985 ~1 ~st~te DLvtslom City of the Colony 5576 North Colony The Colony, Texas 75056 Gentlemen: Enclosed is a cop7 of Lease No. DACW63-1-85-0680 at Lewisville Lake._~xas, ' . .......... . ....... signed o~ behalf of the Government, authorizing you to use the property described therein for the purposes indicated. Your cooperation ~n using the property in eccordance with the conditions of the agreement will be appreciated. Sincerely, tare Division Enclosure DEPARTMENT OF THE ARMY LEASE NO. OACW63-1-85-0680 FOR PUBLIC PARK AND RECREATIONAL PURPOSES LEWISVILLE LAKE PROJECT AREA 'THE SECRETARY OF HE ARMY under authority of Section 4 of the Act of Con- T gress approved 22 December 1944, as amended (16 U.S.C. 460d), hereby grants to the City of the Ce'lony, 5576 N. Colony, The Colony, Texas 75056 years commencing on 1 June 1985 a lease for a period of 25 years p ary jurisdiction of the Denartme ~.¥ e o~0 .~.-..~_~lanai.and. .W. ater areas under ~ nt°~a~ °~Ymt Lew~svl/le Lake Project Area, hereinafter referred to as the premiss as shown on attached Exhibit A and A- 1 recreational purposes. ' ~ , for public park and THIS LEASE is granted subject to the following conditions: 1. The lessee shall conform to such regulations as the Secretary of the Army may issue to govern the public use of the project area, and shall comply with the provisions of the above cited Act of Congress. The lessee shall protect the premises from fire, vandal. ism, and soft erosion, and may make and enforce - ~t~a!e. gal authority, m exercising the privile.es ~_u_c.h r~e.gul~,t!o ,ns as are necessary, and within a~lons are n ' ' . ~ ~uce!a m ~ras lease, provided ot mcon~stent ~uth '~ -- · ' that v~s~ons of the above cited Act of Congress. uea by the Secretary of the Army or with prog. 2 The. lesse,e shall administer and .maintain the premises in accor - Army. Engineers Master Plan and the zm leme · . .__ dance vath t U.S. P ntmg,~en~ral Development Plan)fl~or the prermses and with an Annual Management Program/to be mutually agreed upon between the lessee and the U.S. Army District Engineer in charge of the administration of the proj- ect, which may be amended from time to time as may be necessary. Such Annual Man- agement Program shall include, but is not limited to, the following: a. Plans fo~ management activities to be u~dertaken by the lessee or jointly by the U.S. Army Engineers structed thereon, and the lessee, including improvements and other facilities to be con- b. Budget of the lessee for carrying out the management activities. . c. Personnel to be used in the management of the area. 3. The lessee shall provide the facilities and services necessary to meet the public de- mand either directly or through concesdon agreements with third parties All such a ee ncession agreement will not be effective until approved by the District Engineer ' cm;nts shall state that they are granted subject to the provisions of this l~ase and that~ he4. Adn~ssion, entrance or user fees may be charged by the lessee for the entrance to or use of the premises or any facilities constructed thereon, PROVIDED, prior written approval of the District Engineer is obtained. · Exhibits B and B-2 · * Exhibits B-1 and B-3 · " 5. The amount of any fees and all rates and prices charged by the lessee or its con- eessionaires for accommodations, food (except packaged goods), and services furnished or sold to the public shall be subject to the prior approval of the District Engineer. The les- · ,,~- ~-~-- - .... eaca year, submit to the D~stri~t~Engineer for ap- proval anst of the fees, rates and prices proposed for the following q~l~on(hs, including justification for any proposed increase or decrease. The District Engineer will give written notice to the lessee of his approval of or objection to any proposed fee, rate or price and will, if appropriate, state an approved fe~, rate or price for each item to which an objection has been made. The lessee and/or its concessionaires shall keep a Schedule of such fees, rates or prices posted at all times in a conspicuous place on the leased premises. 6. All monies received by the lessee from operations conducted on the premises, including, but not limited to, entrance and admission fees and user fees and rental or other consideration received from its concessionaires, may be utilized by the lessee for the ad- ministration, maintenance, operation and development of the premises. Any such monies not so utilized, or programmed for utilization within a reasonable time, shall be paid to the District Engineer at the end of each 5-year period. The lessee shall establish and main- rain adequate records and accounts and render annual statements of receipts and expendi- tures to the District Engineer, except for annual or weekly entrance fees which also are honored at other recreatibnal areas operated by the lessee. .The District Engineer shall have the right to perform audits of the lessee's records and accounts, and to require the lessee to audit the records and accounts of third party concessionaires, and furnish the District Engineer a copy of the results of such an audit. 7. All structures shall be constructed and landscaping accomplished in accordance with pLans approved by the District Engineer. Further, the lessee shall not discharge waste or effluent from the premises in such a manner that such discharge will contaminate streams or other bodies of water or otherwise become a public nuisance. 8. The right ia reserved to the United States, its officers, agents, and employees, to enter upon the premises at any time and for any purpose necessary or convenient in con- nection with river and harbor and flood control work, and to remove timber or other ma- terial required for such work, to flood the premises when necessary, and/or to make any other use of the land as may be necessary in connection with public navigation and flood control, and the lessee shall have no claim for damages of any character on account thereof against the United States or any agent, officer or employee thereof. 9. Any property of the United States damaged or destroyed by the lessee incident to the exercise of the privileges herein granted shall be promptly repaired or replaced by the lessee to the satisfaction of the District Engineer. 10. The United States shall not be responsible for damages to property or injuries to persons which may arise from or be incident to the exercise of the privileges herein granted, or for damages to the property of the lessee, or for damages to the property or injuries to the person of the lessee's officers, agents, servants, or employees or others who may be on the premises at their invitation or the invitation of any one of them, arising from or incident to the flooding of the premises by the Government or flooding from any other cause, or arising from or incident to any other governmental activities, and the lessee shall hold the United States harmless from any and all such claims. 11. That at the time of the commencement of this lease, the lessee will obtain from a reputable insurance company, acceptable to the Government, liability or indemnity insur- ance providing for minimum limits of $ 2§0,000 per person in any one claim, and an aggregate limit of $ 500,000 for any number of persons or claims arising from any one incident with respect to bodily injuries or death resulting therefrom, and $ · lO0,000 ' ' for damage to property suffered or alleged to ha~;e been suffered by " any person or persons resulting from the operations of the lessee under the terms of this lease. . Z3. ~s ieee m~y be revoked by Lbe Secretly of the A~m~ i~ the event the ie~e viol~t~ ~ny of t~e ~e~s ~nd conditio~ oE t~ Ieee and continues ~d pe~i~ t~e~ein for ~ pe~od of 30 d~y~ ~ ~otice t~e~eof in ~tin~ by t~e Disc~ct ~nee~. 14. ~ or ~fore the date of expiation of t~ Ieee or i~ re~quis~ent by the l~, the le~ sha~ vacate the prem~es, remove i~ prope~y therefrom, and restore the prem- iss to a condition sat~facto~ to the Dist~ct En~eer. If, however, t~s le~e ~ revoke, the le~ sh~ vacate the prem~es, remove i~ property therefrom, and r~tore the prem- ~s ~ ~oresaid ~t~n such time as the Secretary of the Army may d~gnate. In either event, ff the le~ sh~ fail or neglect to remove i~ property and so r~tore the pre~s, then its property shah become the prope~y of the United States ~thout compe~ation therefor, and no claim for damag~ agent the U~ted States or its officers or agen~ sh~l ~ created by or made on account thereof. ~ns because of race, creed, color or nation~ orion in the conduce. ~de~. The ~antee furnishes ~ V~ of t~~~E~ib~t ) t~t he ~Hf~m?y ~~nd D~- 16. ~ notices to be ~ven pursuant to t~ lease shall be addre~ed.~ to the le~e, to The City of the Colony, 5576 N. Colony, The Colony, Texas 75056; ~ to the Government, tothe District Engineer, Fort ~orth District, Corps of Engineers, P.0. Box 17300, Fort North, Texas 7610~-0300 or as may from time to time be directed by the partiqs. Notice shall be deemed to have been duly ~ven if and when inclosed in a properly seMed envelope or wrapper, addre~ed ~ aforesaid and deposited postage prepaid (or, if mailed by the Government, deposited under its fran~ng p~lege) in a post office or branch post office regularly maintained by the U~ted States Government. 17. Th~ lease is subject to ~ e~sting easement, ~d easements subsequently ~t~, for roadways, ~d utilities locat~ or to be located on the prem~es, prodded that the pro- posed grant of any easement ~11 be coordinated with the lessee and easements ~R not be ~ted which ~H interfere ~th development, present or proposed, by the levee. ,10 18. That on or near the date of execution of this lease, an Inventory and Condition Report of the personal property and improvements of the Government shall be made by a representative of the Government and a representative of the lessee to reflect the condition of said property as of said date. The Inventory and Condition Report is attached as Exhibit "C". At the expiration, revocation, or termination of this lease, a similar Inventory and Condition Report will be made to constitute the basis for settlement by the lessee for any property shown to be lost, damaged, or destroyed. Any such property will either be replaced or restored to the condition required by Condition 14 or, at the election of the Government, reimbursement made therefore by the lessee at the then current market value thereof. 19. That the lessee shall pay the cost of any electricity supplied to the leased area and shall contract independently with the supplier for its own account. The lessee may utilize Government water wells located on said premises for purposes of the lease in exchange for providing maintenance and repair of water systems and equipment utilized. The lessee shall be respon- sible for insuring compliance with all state and local laws governing water quality and testing of wells used. 20. The grantee shall not discriminate against any person or persons or exclude any persons from participation in the grantee's operations, programs, or activities conducted on the leased premises, because of race, color, age, sex, handicap, national origin or religion. The grantee, by acceptance of this lease hereby gives assurance that Title VI of the Civil Rights Act of 1964 (Public Law 88-352) and all requirements imposed by or pursuant to the Directive of the Department of Defense (32 CFR, Part 300, issued as Department of Defense Directive 5500.11, 27 May 1971) will be complied with. 21. That, within the limits of their respective legal powers, the parties to this lease shall protect the project against pollution of its water. The lessee shall comply promptly with any regulations, conditions, or instructions affecting the activity hereby authorized if and when issued by the Environmental Protection Agency and/or a state, interstate or local governmental water pollution control agency having jurisdiction to abate or prevent water pollution. Such regulations, conditions, or instructions in effect or prescribed by the Environmental Protection Agency, state, interstate or local governmental agency are hereby made a condition of this lease. 22. The lessee shall comply with all applicable Federal laws and regulations and with all applicable laws and ordinances and regulations of the state, county, and municipality wherein the'premises are located. 23. The right to enter upon the leased premises at anytime to perform health and safety inspections is hereby reserved to the United States, its officers, agents, and employees. Upon discovery of any condition that presents an imminent and dangerous threat to the health and safety of the public, the inspecting officer may require that any part or all of the permitted premises be closed to the public until such condition is corrected and the danger to the public is eliminated. The determination of the District Engineer regarding the existence of any danger to the public and the need for emergency closure of the permitted premises shall be final and conclusive. The lessee shall have no claim for damages against the United States, or any 'officer, agency or employee thereof on account of action taken pursuant to this condition. 24. That the lessee shall not remove or disturb or cause or permit to be removed or disturbed, any historical, archeological, architectural or other cultural artifacts, relics, vestiges, remains or objects of anitquity. In the event such items are discovered on the premises, the lessee shall immediately notify the District Engineer, Fort Worth District and the site and material shall be protected by the lessee from further disturbance until a professional examination of them can be made or until clearance to proceed is' authorized by the District Engineer. A map, with restricted cultural resource sites outlined in red, is attached as Exhibit D. If future conditions necessitate use of the restricted cultural sites, the District Engineer will be notified. Archeological testing for evaluation of significance will be conducted on each affected site by a qualified archelogist approved by the District Engineer at the expense of the lessee. 25. That non-compliance with terms of the development plan shall constitute non-compliance with terms of the lease and shall be grounds for termination. 26. That the lessee shall be responsible at all times for insuring compliance by its third-party concessionairesWwith all terms and conditions of this lease and with the terms and conditions of its respective third-party agreements. The City of the Colony, acting through its duly authorized agent, shall perform, at least monthly compliance inspections of all concessions. Results of these inspections shall be furnished in writing to the Project Manager, Lewisville Lake. The city will be responsible for insuring that corrective action is prescribed and performed. The District Engineer, likewise through his duly authorized representative, reserves the right to perform periodic compliance inspections and to require the City of the Colony to notify third- party concessionaires of deficiencies and prescribe corrective action. 27. The lessee shall not remove or intentionally cause th~ death of living trees greater than four inches in diameter measured at six inches above ground level without pmior approval of the Reservoir Manager. 5 Prior to execution of this lease the granting clause and Condition No. 5 were modified; Conditions No. 12 and 15 were deleted; and Conditions No. 18, 19, 20, 21, 22, 23, 24, 25, 26, and 27 were added on pages 4 and 5 which are hereby made a part of this instrument. IN WITNESS WHEREOF, I have hereunto set my hand this 28ch day of June 1985, by authority of the Secretary of the Army. Chief, Real Estate Division The above instrument, together with~ provisions and conditions thereof is hereby accepted this /~ day of/J~/~r 1985. F~CITy~J3~ THE COLONY STEWART CREEK PARK GENERAL DEVELOPMENT PLAN EXHIBIT B The development of the park will be according to the following schedule. The City of the Colony will: 1. During years 1-5 o construct 15-20 picnic units o construct group pavilion o prepare baseball/softball field o construct one fishing pier o begin excavation of new roadway to northern half of park o add playground equipment 2. During years 6-10 o complete roadway to northern half of peninsula o construct second fishing pier o construct 20-25 picnic units o construct second restroom facility o extend electricity to new areas of park o construct swimming beach, parking area and bathhouse o add playground equipment 3. During years 11-15 o construct 20-25 picnic units o install additional water fountains throughout park o initiate paddle boat rentals and operations 4. During years 16-25 o prepare updated master plan to make necessary changes o make improvements as called for in the updated master plan o continue operation and maintenance of all facilities, including replacement of deteriorated or damaged facilities STEWART CREEK PARK ANNUAL MANAGEMENT PLAN EXHIBIT B-1 During the twenty-five year term of the lease, the City of The Colony will be responsible for the following at Stewart Creek Park: 1. Operation and maintenance of the park and all facilities and equipment, supervision of park maintenance personnel and park attendants, maintenance of the water system and utilities, and refuse collection. 2. Year round park operation. 3. Development of the proposed improvements and additional facilities as indicated on the General Development Plan. ' 4. Preparing periodic updates of the General Development Plan, as needed. 5. Preparing annual reports to the Corps of Engineers regarding expenditures and income. WYNNEWOOD PARK GENERAL DEVELOPMENT PLAN EXHIBIT B-2 The development of the park will be according to the following schedule. The City of the Colony will: 1. During years 1-4 o remove all existing facilities o construct first phase of golf course (18 holes, club house, learning center) 2. During years 5-10 o construct second phase of golf course (18 holes, any additional needed improvements) 3. During years 11-25 o continue operation, maintenance and repair of all improvements within the park area. WYNNEWOOD PARK ANNUAL MANAGEMENT PLAN EXHIBIT B-3 The City of The Colony, Texas, wishes to lease Wynnewood Park for twenty-five years in conjunction with Stewart Creek Park. During the twenty-five year rem of the lease, the City of The Colony will be responsible for the following at Wynnewood Park: 1. Overseeing the operation of a thirty-six hole public golf course operating under the terms of a sub-lease agreement between the City and Golf Enterprises, Inc. 2. Ensuring that the golf course is operating in accordance with all relevant federal regulations regarding public facilities on federal lands. 3. Preparing annual reports of usage, income, and expenditures relevant to Wynnewood Park. 4. Assisting in the removal of all current facilities at Wynne- wood Park, if so requested by the Corps of Engineers and/or Golf Enterprises, Inc. · JOINT SURVEY AND INSPECTION OF CONDITION OF GOVERNMENT LEASED PROPERTY INSTR UC~'~'ON S ~ SECTION I-PROPE--'I~Ty DATA AND CONDITION AGREEMENT Lewisville Lake su,L.,.~-~-~i. ~. Stewart's Creek Park. Lewisville 1.5 miles, approx - paved roads 0.4 mile, approx - unpaved roads I pit toilet with aeriator 3 drinking fountains 1 well house 7 concrete tables with wooden shelters 15 concrete tables without shelters 17 metal cookers 1 trailer dump station i 2 lane boat ramp 2.5 miles, approx. - g~ard post and cable JOINT AGI~E£M[NT ON THE CONOS~rlON OF' THE: We, the ~d~si~ed, jointly made a su~ey and inaction of the condition of the pro~y menti~ed above. We ague ~st as of ~e date of s~, ~e condition of the prope~y is as des~b~ he.in. ~ y ~, ~servoir Manager 5576 N Colony Blvd US A~y Engineer District, Ft. Worth The Colony. Texas 75056 SECTION II - EXTERIOR CONDITIOH OF THE PROPERTY Good Good Good Good OK OK Good OK OK Overall the condition of the park is good. Section 1 - Property Data and Condition Agreement 1.5 miles, approx - paved roads - serviceable but has some cracking, will require resurfacing. 0.4 mile, approx - unpaved roads - good/serviceable 1 pit toilet with aeriator ~ good/serviceable 3 drinking fountains - good/serviceable 1 well house - good/serviceable 8 concrete tables with wooden shelters - good 15 concrete tables without shelters - good 17 metal cookers ~ good/serviceable 1 trailer dump station - good/serviceable 1 two lane boatramp - good/serviceable 2.5 miles, approx - guard post and cable - good/serviceable · JOINT SURVEY AND INSPECTION OF CONDITION OF GOVERNMENT LEASED PROPERTY INSTRUCTIONS ~ SECTION I. PROPERTy  o DATA AND CONDITION AGREEMENT Lewisville Lake [^.~o IUI~DINe A~[A ~WMeleet) Wynnewood Park, Lewisville Lake 2 miles, approx - paved roads 0.5 miles, approx - unpaved roads 1 pit toilet 2 drinking fountains 1 well house 5 concrete tables with wooden shelters .,...~ .... . .... ~ i1 concrete tables without shelters 6 metal cookers I trailer dump station 1 two lane boat ramp 2.8 miles, approx - guard post and cable JOINT &GIqLI~E~M~NT ON THE. CONDITION OF THE We, the undersigned, jointly made a survey and inspection of the condition of the property mentioned above. We agree that as of the date of survey, the condition of the property is as described herein. G'~ty of The Colon_y__ -- , eservoir Manager 5576 N. Colony Blvd The Colony, Texas 75056 US Army Engineer District, Ft. Worth ENG FORM 3143 ¢~R ~OS-~0) SECTION II - EXTERIOR CONDITIOe4 OF THE PROPERTY (~tt~h ~'~ ~ a~ It~.) Good - needs painting; vents damaged Fair - needs painting; one block damaged on women's side; inside walls shot up. Ail stall doors and frame missing; all window and door frames missing. Approximately 700 feet of cable and post pulled up or missing. Dead trees lying in many areas and most trees need trimming. Good - need repairs ~AR&G~ AMD OUT lU~DIN,I Well house needs painting; pump electrical control box missing. OK Overall park condition i~ very poor. Section 1 - Property Data and Condition Agreement 2 miles, approx - paved roads - very poor/passable _ approx 1 mile of paving has been washed away and the remaining mile is badly cracked and will require resurfacing. 0.5 mile, approx - unpaved roads - fair/serviceable 1 pit toilet - fair/serviceable _ needs painting both inside and out. 2 drinking fountains - fair/serviceable on both. - bubblers missing I well house - good/serviceable _ needs painting electrical control box missing. - pump 5 concrete tables with wooden shelters - good - three shelters completely destroyed - two damaged and need painting. 11 concrete tables without shelters - good - one table has had ground eroded out from under it. 6 metal cookers - fair/serviceable _ need painting and Some repair . 1 tra/ler dump station ~ fair/serviceable _ water hydramt missing - signs missing. ! two lane boatramp - good/serviceable _ some erosion on sides of approach road. 2.8 miles, approx - guard post and cable - fair/serviceable, approx 700 feet pulled up or missing.