13637 1 RESOLUTION NO. 13,637
2
3 A RESOLUTION TO AUTHORIZE THE MAYOR AND CITY CLERK TO
4 EXECUTE A LEASE AND CONCESSION AGREEEMENT BETWEEN
5 THE CITY, THE ADVERTISING & PROMOTION COMMISSION, AND
6 FWH II LITTLE ROCK, LLC, FOR THE LEASE OF THE PROPERTY
7 COMMONLY REFERRED TO AS THE PEABODY HOTEL; TO
8 AUTHORIZE THE MAYOR AND THE CITY CLERK TO EXECUTE
9 AND ESTOPPEL CERTIFICATE AND TERMINATION OF LEASE
10 BETWEEN THE CITY, THE ADVERTISING & PROMOTION
11 COMMISSION, FWH II LITTLE ROCK, LLC, AND BG EXCELSIOR
12 LIMITED PARTNERSHIP, TO TERMINATE THE CURRENT LEASE
13 FOR THE PROPERTY COMMONLY REFERRED TO AS THE
14 PEABODY HOTEL; AND FOR OTHER PURPOSES.
15
16 WHEREAS,the City authorized the entry into a lease agreement between the City,the Advertising
17 &Promotion Commission("the Commission")and BG Excelsior Limited Partnership, on September 18,
18 2000, for the lease of the property generally referred to as the Peabody Hotel, and more completely
19 described in the lease,and authorized entry into an amendment to this lease on October 1,2002; and,
20 WHEREAS, these agreements also authorized certain control, operation and maintenance of the
21 property commonly referred to as the Statehouse Convention Center; and,
22 WHEREAS, pursuant to Little Rock, Ark., Resolution No. 13,621 (December 19, 2012), the City
23 authorized a letter of intent to be sent to FWH II Little Rock, LLC ("FWH"), as to terms and conditions
24 for a lease agreement between that entity, the City, and the Commission, for the lease of the property;
25 and,
26 WHEREAS, after negotiations between the City, the Commission, and FWH an agreement has been
27 reached as to the various terms and conditions;
28 NOW, THEREFORE,BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY
29 OF LITTLE ROCK,ARKANSAS:
30 Section 1. The Mayor and City Clerk are authorized to execute a Lease and Concession Agreement
31 between the City, the Commission, and FWH, in a form acceptable to the City Attorney, and in
32 substantially the same form as that attached as Exhibit A to this resolution, which will set forth the terms
[Page 1 of 2]
I and conditions for the use of Demised Premises and Excepted Premises at the area commonly referred to
2 as the Peabody Hotel and the Statehouse Convention Center.
3 Section 2. The Mayor and City Clerk are authorized to execute an Estoppel Certificate and
4 Termination of Lease document between the City, the Commission, FWH, and BG Excelsior Limited
5 Partnership, in relation to the same properties, as attached as Exhibit B to this resolution.
6 Section 3. The Mayor and the City Clerk are also authorized and directed to do any and all things
7 necessary to effect the preparation, execution and delivery of the Lease and Concession Agreement
8 referred to in Section 1, and the performance of all obligations of the City thereunder including, but not
9 limited to, the execution, and delivery of all papers, documents, certificates and other instruments that
10 may be required for the carrying out of such authority or to evidence the exercise thereof.
11 Section 4. Severability. In the event any title, section, paragraph, item, sentence, clause, phrase, or
12 word of this resolution is declared or adjudged to be invalid or unconstitutional, such declaration or
13 adjudication shall not affect the remaining portions of the resolution which shall remain in full force and
14 effect as if the portion so declared or adjudged invalid or unconstitutional were not originally a part of the
15 resolution.
16 Section 5. Repealer. All laws, ordinances, resolutions, or parts of the same, that are inconsistent
17 with the provisions of this resolution, are hereby repealed to the extent of such inconsistency.
18 ADOPTED: January 22,2013
19 ATTES • APPROVED:
20 1/121 L: /,
22 +u an :ngle City Clerk Mark Stodola, ayor
23 AP 'O ED AS TO LEGAL FORM:
24 ///
25 ` 7 v(/J
26 Thomas M. Carpenter,Cityorney
27 // �/
28 //
29 //
30 //
31 //
32 //
33 //
34 //
35 //
[Page 2 of 21
EXHIBIT A
LEASE AND CONCESSION AGREEMENT
KNOW ALL MEN BY THESE PRESENTS:
This Lease and Concession Agreement (the "Lease Agreement") made and
entered into at Little Rock, Arkansas, on the 28th day of February, 2013 (the "Effective
Date"), by and between the City of Little Rock, Arkansas (the "City"), a municipal
corporation organized under and existing by virtue of the laws of the State of Arkansas,
acting by duly adopted resolution; and the City Advertising and Promotion
Commission of Little Rock, Arkansas (the "Commission"), as agent of and for the City
of Little Rock, acting by duly adopted resolution, (the City and the Commission being
hereinafter referred to collectively as the "Lessor"), and FWH II Little Rock, LLC
("FWH"), a Delaware limited liability company, acting by and through Fairwood
Hospitality Investors II, L.L.C. (the "Member"), a Delaware limited liability company,
acting by and through Fairwood Investors II, LLC (the "Manager"), (FWH, acting
through its Member and Manager, being hereinafter referred to as the "Lessee").
WITNESSETH:
WHEREAS, Lessor and Lessee hereby acknowledge that pursuant to that certain
Amended, Restated and Substituted Lease and Concession Agreement (the "Former
Lease Agreement") made and entered into at Little Rock, Arkansas, on the 18th day of
September, 2000, by and between Lessor, and BG Excelsior Limited Partnership (the
"Limited Partnership"), an Arkansas limited partnership, acting by and through, BEX,
Inc. (the "General Partner"), an Arkansas corporation, its duly authorized and empowered
general partner, both the Limited Partnership and the General Partner thereof being
authorized to do business in Arkansas, (the Limited Partnership and the General Partner
being hereinafter referred to collectively as the "Former Lessee"), Lessor has heretofore
leased to Former Lessee, and Former Lessee has heretofore leased from Lessor, the
Demised Premises as described in the Former Lease Agreement; and
WHEREAS, Lessee is acquiring certain assets from the Former Lessee, including
without limitation, all of the Former Lessee's interest in the Demised Premises and other
assets related to the hotel operations heretofore conducted by the Former Lessee on the
Demised Premises; and
WHEREAS, the City and the Commission consent to and approve all such
transfers from the Former Lessee to Lessee; and
WHEREAS, Lessee accepts the Demised Premises "as is", subject to the terms of
this Lease Agreement; and
1
1160171-v1
WHEREAS, effective simultaneously with the Effective Date of this Lease
Agreement, the Former Lease Agreement has been mutually terminated by Lessor and
Former Lessee; and
WHEREAS, the City is a duly organized municipality, existing as a City of the
first class under and by virtue of the laws of the State of Arkansas with full and lawful
power and authority to enter into this Agreement, acting by and through its Board of
Directors, in the public interest and for public purpose, in securing Lessee's branding as a
franchised Full Service Marriot Hotel, provided, however, Lessee shall have the option to
elect to continue to operate as The Peabody Hotel for all of any portion of the initial six
(6) months of the Term of this Lease Agreement, of the 418 key hotel property currently
known as The Peabody Hotel located at Three Statehouse Plaza, Little Rock, Arkansas
72201 and Lessee's conformity with the Marriott Property Improvement Plan, such Hotel
adding to the welfare of the City and its inhabitants, all pursuant to the laws and
enactments of the State of Arkansas; and
WHEREAS, the Commission has been duly authorized by the City to operate the
Statehouse Convention Center adjacent to the Hotel, and the successful operation of the
Statehouse Convention Center and the Hotel are inter-dependent through the Statehouse
Convention Center and the Hotel, drawing patrons and providing service to patrons and
guests at a substantially enhanced level in conformity with the Marriott brand or any
other Approved Hotel; and
WHEREAS, Lessee has agreed to use commercially reasonable efforts to
undertake branding of the Hotel initially as a franchised Full Service Marriot Hotel
utilizing the words "Little Rock" in the Hotel name, provided, however, Lessee shall
have the option to elect to continue to operate as The Peabody Hotel for all or any portion
of the initial six (6) months of the Term of this Lease Agreement, final approval of the
Hotel name being subject to approval of the franchisor, and to undertake Lessee's
conformity with the Marriott Property Improvement Plan, as set forth more fully herein,
it being understood and agreed that the Lease shall not be contingent upon Lessee's
obtaining a franchise from Marriott; and
WHEREAS, Lessee shall have the right to manage the Hotel, or to engage
separate professional management for the day to day operations of the Hotel, all in
accordance with sound business practices and the requirements of the Approved Hotel
franchise; and
WHEREAS, the parties have agreed that the provisions of this Lease Agreement,
including the branding of the Hotel as a franchised Full Service Marriot Hotel and
Lessee's conformity with the Marriott Property Improvement Plan, all provide benefit to
the City, the Commission, Lessee, and the general public.
2
1160171-�1
NOW, THEREFORE,
For and in consideration of the mutual premises and promises herein contained,
the Lessor and the Lessee covenant and agree as hereinafter stated, to-wit:
ARTICLE I
DEFINITIONS
SECTION 1.1: SINGULAR, PLURAL AND GENDER. The Lessor and
Lessee agree that any word contained in the text of this Lease Agreement shall be read as
the singular or the plural and as the masculine, feminine or neuter gender as may be
applicable in the particular context. More specifically, however, for the purposes of this
Lease Agreement the Lessor and Lessee agree that the following words shall have the
meanings attributed to them in this Section:
(a) "Adjacent Property" means that real property which is adjacent to the
Demised Premises.
(b) "Annual Rent" and "Annual Rent Amount" means the amount of rental
stated in Section 5.1.
(c) "Approved Hotel" or "Approved Hotels" includes any Full Service hotel
affiliated with Marriott, Hilton, Hyatt, or Starwood (but specifically excluding its Four
Points brand) and their successors if of similar quality. The list of Approved Hotels may,
upon the written request of Lessor or Lessee, be reviewed by Lessor and Lessee not more
frequently than every five (5) years, subject to the then current expiration date of any then
existing Approved Hotel franchise.
(d) "Commission" means the City Advertising and Promotion Commission of
Little Rock, Arkansas, or its successor.
(e) "Concession Fee" means the fee payable by the Lessee to the Lessor as
prescribed by Section 17.4.
(f) "Conference Center" means that portion of the Demised Premises
consisting of the property, real, personal and mixed as described on Exhibit "A" attached
hereto, which comprises all of the property in the Survey designated as "Conference
Center", as such Exhibit "A" may be amended and replaced by subsequent sheets,
drawings, or surveys.
(g) "Consumer Price Index" means the monthly indices for the applicable
month published by the Bureau of Labor Statistics of the United States Department of
Labor as "The Consumer Price Index for Urban Wage Earners and Clerical Workers-U.S.
All Items, U.S. City Average (Base Period: 1967 = 100)."
3
1160171-v1
(h) "Control" (including correlated meanings such as the terms "controlling",
"controlled by" and "under common control with"), as used with respect to any entity,
means the possession of the power to direct or cause the direction of management
decisions and policies of that entity.
(i) "Demised Premises" means the property, real, personal and mixed, more
particularly described on Exhibit "B" attached hereto and by this reference fully
incorporated herein and made a part hereof as if set forth herein word for word and
includes specifically the CONFERENCE CENTER. the HOTEL BUILDING and the
IMPROVEMENTS, together with a license granted to Lessee during the Term of this
Lease Agreement for the joint use with Lessor of any related furniture, fixtures,
equipment, machinery, improvements, building systems, stairways, elevators, escalators,
corridors, skywalks, shafts, plumbing, HVAC systems and controls, sprinkler systems
and controls, alarm systems and controls, electrical systems, ducts, plenums, structural
support, utility lines, pipes, all related software and computers, and similar infrastructure
providing access to or serving the Demised Premises.
(j) "Disposition" (including the correlated meaning "disposed") means any
sale, assignment, transfer, distribution or conveyance by Lessee of the Hotel or the sale,
assignment, transfer, distribution or conveyance by the Member of its Control of Lessee.
Provided, however, the term Disposition as used herein does not mean a cash or property
distribution to shareholders, partners (whether general or limited), venturers (whether
joint or not), members or member-managers or other beneficial owners of the Lessee.
Provided, further, the term "Disposition" as used herein does not mean any Permitted
Mortgage or a foreclosure, deed in lieu of foreclosure, or other transfer to the holder of
the Permitted Mortgage or to any acquirer of the holder's rights in or pursuant to the
Permitted Mortgage.
(k) "Effective Date" means the later of the date on which this Agreement is
finally executed by Lessor and Lessee, or the date on which Lessee acquires from the
Former Lessee all of its interest in any assets owned or used in the operation of the Hotel
pursuant to that certain Purchase and Sale Agreement between the Former Lessee and
Lessee dated June 25, 2012, as amended.
(1) "Excepted Premises" means the real property and improvements, except
for the Demised Premises, but including the Statehouse Convention Center, more
particularly described on Exhibit "C" attached hereto and by this reference fully
incorporated herein and made a part hereof as if set forth herein word for word.
(m) "Event of Default" means the occurrence of any action or event specified
in Section 25.1.
(n) "Force Majeure" as used herein means that in the event performance of
any of the respective obligations, covenants, conditions, promises or agreements set forth
herein by either party hereto is prevented, interrupted or delayed by causes beyond that
party's control, including, but not limited to, strike, riot, storm, flood, war, acts of God,
4
1160171-v1
fires, epidemics, quarantine restrictions, freight embargoes, and unusually severe
weather, or delays of subcontractors due to such causes, and not caused by any act or
failure to act by the party thereby delayed, interrupted or prevented in such performance
or observance; then, and in such event, the date or time or times for performance or
observation of such obligations, covenants, conditions, promises or agreements shall be
extended for a period of time equal to the number of days the performance or observation
of such obligations, covenants, conditions, promises or agreements is prevented,
interrupted or delayed. In such case, neither party shall be liable for any costs, losses,
damages, injuries or liabilities caused to or suffered or incurred by the other party in
connection with such obligations, covenants, conditions, promises or agreements.
PROVIDED, HOWEVER, in the event that either party intends to avail itself of the
provisions of this section, that party must first give written notice of such intent to the
other party within thirty (30) days from the date performance or observation of such
obligations, covenants, conditions, promises or agreements was prevented, interrupted or
delayed or be barred therefrom.
(o) "Full Service" means, with respect to a hotel, an upscale or luxury hotel
with a restaurant, lounge facilities and meeting space as well as service levels including,
but not limited to, bell service, valet service, concierge, full service catering and room
service.
(p) "Hotel" means the Approved Hotel operated on the Demised Premises by
Lessee.
(q) "Hotel Building" means all buildings and structures situated, now or
hereafter, on and within the Demised Premises.
(r) "Imposition" means all of the ad valorem taxes, special assessments, or
other taxes, charges, levies and any other type governmental charges levied or assessed
against the Lessee or the Demised Premises.
(s) "Improvements" means all buildings, structures and improvements of any
nature whatsoever (including all supports, foundations, structures, landscaping,
sidewalks, skywalks, driveways, ramps, porches, bridges, tunnels and fixtures) located or
to be located upon and on the Demised Premises or appurtenant thereto (including the
Renovation and Enhancement Work described in Article IV hereof), as well as all
apparatus and equipment necessary for the complete and comfortable use, occupancy,
enjoyment, operation, maintenance and repair of the Demised Premises at any time
situated on or upon the Demised Premises, including but not limited to all fittings,
appliances, machinery, garage equipment, ventilating equipment, wiring, controls,
communications equipment, switchboards, antennae, escalators, floor coverings, hot
water heating equipment, all furniture, furnishings, buildings materials, supplies,
machines, chillers, motors, engines, boilers, stokers, pumps, fans, vents, blowers,
dynamos, furnaces, elevators, ducts, shafts, pipes, furniture, cabinets shades, blinds,
screens, plumbing, heating, air conditioning, lighting, lifting, ventilating, refrigerating,
cooking, medical, laundry and incinerating equipment; partitions, drapes, carpets, rugs
5
1160171-v1
and other floor coverings, awnings, signs, sign structures and supports, call and sprinkler
systems, fire prevention and extinguishing apparatus and equipment, water tanks,
swimming pools, compressors, vacuum cleaning systems, disposals, dishwashers, ranges,
ovens, kitchen equipment, cafeteria equipment, recreational equipment, lawn and
landscaping equipment and supplies.
(t) "Legal Requirements" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, requirements of any and all governmental,
depal tments, commissions, boards, courts, authorities, or agencies now or at any time
hereafter applicable to the Demised Premises.
(u) "Lease Year" means 12 consecutive months. The first Lease Year shall
begin on the date that Lessee takes possession of the Demised Premises if that date is the
first day of the calendar month; if not, then the first Lease Year shall commence upon the
first day of the calendar month next following the date that Lessee takes possession of the
Demised Premises. Each succeeding Lease Year shall commence upon the anniversary
date of the first Lease Year.
(v) "Permitted Mortgagee" or "Permitted Mortgage" means a mortgagee or
mortgagees holding a mortgage or mortgages and transferee of a security interest
permitted by Sections 6.1(a) or 6.1(b).
(w) "Person" means any natural person, firm, partnership, corporation or any
other entity.
(x) "Plans and Specifications" means the information required by Section 4.2
herein.
(y) "Product Improvement Plan" or "PIP" shall mean the renovations and
enhancements to the Demised Premises or to the Hotel which Lessee is required to
perform in order to obtain or continue a franchise for an Approved Hotel.
(z) "Rents" means the Annual Rent Amount as defined herein.
(aa) "Rent Start Date" means the date that the Lessee takes possession of the
Demised Premises.
(bb) "Renovation and Enhancement Work" means the work described in
Article IV herein.
(cc) "Statehouse Convention Center" or "Convention Center" means the
portion of the Excepted Premises used and operated by Lessor as the Lessor's premier
convention center.
(dd) "Sublease and Sublessee" The term "Sublessee" herein shall mean any
subtenant, concessionaire, licensee or occupant of space in or on the Demised Premises
holding by or through the Lessee; the term "Sublease" shall mean any lease, license,
6
1160171-v1
concession or other agreement for the use or occupancy of the Demised Premises made
by the Lessee or any person holding by or through the Lessee.
(ee) "Substantial Completion" (including the correlated term "substantially
completed") means that the Renovation and Enhancement Work described in Article IV
hereof has been so completed that it is finished and/or ready for the beneficial use,
enjoyment and occupancy of the Lessee under the Lease Agreement.
(ff) "Survey" means the survey of the Demised Premises and the Excepted
Premises prepared by McCaskill &Associates, Inc., dated February 21, 2013.
SECTION 1.2: EXECUTION AND EFFECTIVENESS. This Agreement, and
the respective rights, obligations and duties of the parties hereunder, shall be effective
upon the later of the date (i) Lessee and Lessor have each executed and delivered four (4)
counterpart originals of this Agreement; or (ii) Lessee has completed the acquisition from
the Former Lessee of all of its interest in any assets owned or used in the operation of the
Hotel pursuant to that certain Purchase and Sale Agreement between the Former Lessee
and Lessee dated June 25, 2012, as amended.
ARTICLE II
THE DEMISE
SECTION 2.1: THE DEMISE. The Lessor, for and in consideration of the
Rents reserved and of the covenants and agreements made by the Lessee to be kept,
observed and fully performed, does demise, let, rent and lease to the Lessee and the
Lessee does accept, rent and lease from the Lessor the Demised Premises, subject to all
matters of record, for the term and upon and under the conditions herein stated.
TO HAVE AND TO HOLD the same unto the said Lessee for the term hereof and
upon and under the conditions herein stated, together with all rights and privileges
appurtenant thereto.
SECTION 2.2: DEMISED PREMISES TO BECOME PROPERTY OF
LESSOR. Upon termination of this Agreement, whether by the passage of time, by
surrender(which, if applicable, is consented to by a Permitted Mortgagee) or by an Event
of Default (which, if applicable, a Permitted Mortgagee has elected to forego its rights
under Article VI herein to cure or make a new lease), the Demised Premises shall become
the sole property of the Lessor in fee simple and free and clear of all encumbrances
excepting (i) only the lien of taxes assessed, if any, but not yet due and payable (for
which the Lessee shall remain obligated to pay to the extent that they are allocable to the
period prior to the termination of this Agreement); and (ii) those matters approved by the
parties hereto and reflected as Exceptions in Schedule B-II of Lessee's title insurance
commitment dated as of the Effective Date of this Lease Agreement.
7
1160171-v1
SECTION 2.3: COVENANTS TO PERFORM. This Agreement is made upon
the foregoing and the following covenants and conditions, each of which the party bound
by such covenants and conditions agrees to perform, irrespective of whether the
particular provision is in the form of a covenant, an agreement, a condition, a direction or
otherwise, and each party agrees to provide the other party with the documents or further
assurances as may be required to carry out the expressed intention of the parties.
ARTICLE III
THE TERM; RENEWALS
SECTION 3.1: THE TERM. The term of this Agreement shall commence at
12:01 A.M. on the Effective Date and shall end at 12:00 Midnight, December 31, 2052,
unless sooner extended or terminated as provided herein.
Simultaneously with the Effective Date of this Agreement, Lessor and Lessee
shall amend the terms of each of the 3 parking leases to be equal to the term of this Lease
Agreement, including any renewal terms, and Lessor shall reaffirm and extend for the
benefit of Lessee the "Ashley Street Parking Franchise" for such same term, all in the
form of the "Assignment, Assumption, and First Amendment to Parking Lot Lease
Agreements and Reaffirmation and Extension of Ashley Street Parking Franchise"
attached hereto as Exhibit"D".
SECTION 3.2: RENEWALS. So long as Lessee is not then otherwise in default
hereunder, Lessee shall have the option to elect two (2) successive renewals of this Lease
Agreement, each such renewal to be for a term of twenty-five (25) years and to be subject
to the terms and conditions of this Lease Agreement, provided that written notice of the
renewal is given by Lessee to Lessor on or before January 1, 2052, for the first 25-year
renewal and on or before January 1, 2077 for the second renewal term. The Rent during
the renewal periods shall be as stated in Section 5.1(a)(viii) of this Lease Agreement.
ARTICLE IV
DELIVERY OF POSSESSION, PLANS AND
SPECIFICATIONS AND CONSTRUCTION
SECTION 4.1: POSSESSION AND DISCLAIMER. Lessor and its Former
Lessee and predecessors in interest have been and are in lawful possession of the
Demised Premises since September 15, 1980, and have accepted possession thereof with
any and all rights, privileges and obligations attendant thereto. The Lessor acknowledges
and represents that, immediately prior to the Effective Date, the Former Lease Agreement
is in full force and effect without any defaults under it or under any other agreement
between Lessor and the Former Lessee with respect to the Demised Premises, and that all
work required to have been performed by the Former Lessee has been fully completed in
a manner satisfactory to Lessor, except for any repairs or renovations that are ongoing
currently. Lessor shall deliver to Lessee, and shall cause Lessor's Former Lessee to
8
1160171-v1
deliver to Lessee, an Estoppel Statement dated as of the Effective Date containing terms
suitable to Lessee in Lessee's absolute discretion and being substantially in the form
attached hereto as Exhibit"E".
SECTION 4.2: RENOVATIONS AND ENHANCEMENTS TO DEMISED
PREMISES. (a) Lessee, at its sole cost and expense, shall perform such Renovation and
Enhancement Work that the Lessee is required to perform in order to comply with the
PIP, such work to be performed in accordance with the schedule required by the PIP or as
otherwise permitted by the franchisor. Lessor acknowledges receipt of the initial PIP and
a copy of Lessee's overall initial capital budget and consents to all items required by such
initial PIP and initial capital budget and, to the extent not prohibited by the applicable
franchisor, Lessee agrees to provide to Lessor copies of any subsequent PIP or other
requirements imposed by the applicable Approved Hotel during the Term of this Lease
Agreement.
The Renovation and Enhancement Work, when completed, is intended to enable
the Lessee to operate, manage, maintain, repair and replace the Demised Premises as a
franchised Full Service Marriott Hotel or other Approved Hotel in accordance with the
standards mandated and required by Article VII hereof
(b) To the extent, if any, that the Renovation and Enhancement Work required
by the PIP or any other work required by the Approved Hotel franchisor at any time
includes work to be performed which materially alters the structural support of the Hotel
Building, Lessee shall cause plans and specifications for such alterations to be prepared
and submitted by the Lessee to the Lessor. Such plans and specifications shall be
examined and reviewed by the Lessor and such persons as it designates and within thirty
(30) days of its receipt of said plans and specifications, the Lessor shall notify the Lessee
of any objections which the Lessor has thereto and such plans and specifications shall be
redesigned, redrawn and reworded by the Lessee to the reasonable satisfaction of the
Lessor, such approval not to be unreasonably withheld, conditioned, or delayed. If the
Lessor fails to notify Lessee of its objections to the plans and specifications within the 15
day period aforesaid, then the Lessor shall be deemed to have approved the plans and
specifications as submitted.
(c) The Lessor shall not be required to review the PIP or any Plans and
Specifications in detail and the Lessor shall not be responsible for or liable in any way to
anyone for any error or omission therein or the failure of the PIP or Plans and
Specifications to comply with any building code or regulation or for any inconsistency or
incompatibility therewith.
(d) Upon completion of any Renovation and Enhancement Work or other
work which materially alters the structural support of the Hotel Building, Lessor and
Lessee, or their advisors, shall inspect the construction for substantial conformity to the
PIP and/or, if applicable, conformity to any related Plans and Specifications applicable to
material structural alterations, and Lessee shall deliver to Lessor a copy of the
franchisor's documentation confirming that the PIP has been completed. If applicable,
9
1160171-v1
Lessee shall furnish Lessor, without cost, one copy in reproducible form of the final Plans
and Specifications applicable to material structural alterations, together with Lessee's
written authorization to use said Plans and Specifications without further cost or expense
to Lessor. Concurrent with the delivery of the Plans and Specifications required
hereunder, Lessee shall make good faith efforts to cause the architects or engineers who
prepared said Plans and Specifications to execute and deliver to the Lessor written
authorization empowering the Lessor to use said Plans and Specifications after
termination of this Agreement.
(e) Any non-structural changes desired by the Lessee or required by the PIP
or otherwise required by the Approved Hotel franchisor at any time are hereby consented
to and approved by Lessor and shall not require further review or approval by Lessor. If
subsequent PIP requirements are implemented or imposed by the franchisor of the then
applicable Approved Hotel which require material structural alterations, the structural
elements of such subsequent PIP shall be submitted by Lessee to Lessor, shall be
examined and reviewed by Lessor and such other persons as it may choose for
compliance with this Article IV, and Lessor shall notify Lessee of Lessor's objections to
any material structural work required pursuant to such subsequent PIP within fifteen (15)
days of Lessee's receipt thereof. If the Lessor fails to notify Lessee of its objections to
the said PIP within the 15 day period aforesaid, then the Lessor shall be deemed to have
approved the PIP as submitted.
(f) The parties recognize that the anticipated cost of the Renovation and
Enhancement Work required by the PIP and the initial capital budget is currently
estimated by Lessee to be approximately Sixteen Million Dollars ($16,000,000) subject
to itemization of estimated costs to be submitted by Lessee to Lessor within six (6)
months following the Effective Date. The parties recognize that the work required by the
PIP shall determine the actual cost thereof. The parties further recognize that the
Renovation and Enhancement Work and related alterations required by the PIP are of
significant benefit to the Lessor, the Lessee and the citizens of Little Rock.
SECTION 4.3: COMMENCEMENT OF CONSTRUCTION. Construction of
the Renovation and Enhancement Work required by the PIP shall begin on or before the
date required by the PIP, unless extended by mutual agreement of the franchisor and
Lessee, and shall be conducted by Lessee and its contractors in a manner that minimizes
disruption of operation of the Hotel. The Lessee covenants with Lessor that at no time
during the terms hereof shall the Demised Premises be closed down or operations thereof
completely suspended, except closure or suspension resulting from Force Majeure as
defined herein, although it is acknowledged by the parties hereto that it will be necessary
to temporarily close portions of the Demised Premises and temporarily suspend
operations of portions of the Demised Premises during the course of completion of the
Renovation and Enhancement Work, which temporary closures and suspensions the
Lessee will use its reasonable efforts to keep at a minimum.
SECTION 4.4: COMPLETION OF CONSTRUCTION. The Renovation and
Enhancement Work shall be substantially complete on or before the date required by the
10
1160171-v1
PIP, unless extended by agreement of the franchisor and Lessee or unless due to Force
Majeure.
SECTION 4.5: USE OF DEMISED PREMISES AND EXCEPTED
PREMISES DURING CONSTRUCTION. During the course of completion of the
Renovation and Enhancement Work, should an area of the Demised Premises or the
Excepted Premises whereat an event has been previously scheduled be unusable because
of construction work; then and in that event, and only to the extent space in the Excepted
Premises is available and not otherwise in use, the Lessor agrees to allow the Lessee to
occupy space in the Excepted Premises at no charge for the purpose of conducting the
meeting, event or banquet of the Lessee's guest originally scheduled in the Demised
Premises, and likewise the Lessee agrees to allow Lessor to occupy space in the Demised
Premises at no charge for the purpose of conducting the meeting, event or banquets of the
Lessor's licensee originally scheduled in the Excepted Premises. Notwithstanding the
foregoing, additional charges such as security, janitorial, setup, and audio visual are not
included in the free use of such space and, to the extent that either party has received a
fee from a licensee for the use of such space, that fee shall be passed through to the other
party for use of its space. Both Lessor and Lessee will give each other as much advance
notice of their respective need for space and each will make every effort to accommodate
each other's need so as to keep the loss of business at a minimum.
ARTICLE V
RENT
SECTION 5.1: DEMISED PREMISES RENT. (a) The Lessor and
Lessee covenant and agree that the term "Annual Rent Amount" shall mean the annual
amount of rent due and payable by the Lessee to the Lessor in a particular year as stated
below. In addition to the other obligations undertaken herein by the Lessee to be well,
truly and fully performed, the Lessee covenants and agrees to pay to the Lessor as Rent
of and for the Demised Premises the following amounts:
(i) For the period from the Effective Date through December 31,
2013, the Lessee covenants and agrees to pay to the Lessor as Rent of and
for the Demised Premises the sum of EIGHTY-FIVE THOUSAND AND
NO/100 ($85,000.00) DOLLARS PER ANNUM (the Annual Rent
Amount for this period);
(ii) For the period from January 1, 2014 through December 31, 2014,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
the Demised Premises the sum of NINETY THOUSAND AND NO/100
($90,000.00) DOLLARS PER ANNUM (the Annual Rent Amount for
this period);
(iii) For the period from January 1, 2015 through December 31, 2015,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
11
1160171-v1
the Demised Premises the sum of NINETY FIVE THOUSAND AND
NO/100 ($95,000.00) DOLLARS PER ANNUM (the Annual Rent
Amount for this period);
(iv) For the period from January 1, 2016 through December 31, 2016,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
the Demised Premises the sum of ONE HUNDRED FIVE THOUSAND
AND NO/100 ($105,000.00) DOLLARS PER ANNUM (the Annual Rent
Amount for this period);
(v) For the period from January 1, 2017 through December 31, 2017,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
the Demised Premises the sum of ONE HUNDRED TWENTY
THOUSAND AND NO/100 ($120,000.00) DOLLARS PER ANNUM
(the Annual Rent Amount for this period);
(vi) For the period from January 1, 2018 through December 31, 2018,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
the Demised Premises the sum of ONE HUNDRED THIRTY FIVE
THOUSAND AND NO/100 ($135,000.00) DOLLARS PER ANNUM
(the Annual Rent Amount for this period);
(vii) For the period from January 1, 2019 through December 31, 2052,
the Lessee covenants and agrees to pay to the Lessor as Rent of and for
the Demised Premises the sum of ONE HUNDRED FIFTY THOUSAND
AND NO/100 ($150,000.00) DOLLARS PER ANNUM (the Annual Rent
Amount for this period);
(viii) For each of the Renewal Terms from January 1, 2053 through the
end of the Term of this Lease Agreement, including the Renewal Terms,
the fixed Annual Rent Amount to be paid during each such Renewal
Term; shall equal the greater of (a) FOUR HUNDRED THOUSAND
AND NO/100 ($400,000.00) DOLLARS PER ANNUM, or (b) One
Percent (1%) of the total gross revenue of the Hotel, as reported, for the
last full operating year preceding the first day of the applicable Renewal
Term (the Annual Rent Amount for this period).
(b) The Annual Rent Amount applicable to each period as stated above shall
be paid by the Lessee to the Lessor in equal quarterly installments, in advance, upon the
first day of each January, April, July and October of each year during the term hereof,
commencing on the Effective Date and continuing throughout the Term hereof. If the
Effective Date is not the first day of January, April, July or October, then Lessee shall
pay, on the Effective Date, a pro rata portion of the Annual Rent Amount with respect to
the partial calendar quarter. If the Lease terminates on any day other than the last day of
March, June, September or December, the Lessee shall pay only a pro-rata portion of the
Annual Rent Amount with respect to the partial calendar quarter.
12
1160171-v1
(c) Lessee shall also pay to Lessor a facilities maintenance surcharge to offset
a portion of the maintenance expenses incurred by Lessor resulting from (i) central plant
property and casualty insurance premiums, (ii) central plant preventive maintenance
contracts, and (iii) water treatment. The surcharge shall be initially set at $7,195 per
month, of which $3,077 is a monthly fixed equipment depreciation expense for 25 years,
and $4,118 is a variable amount based on 71% of the actual costs delineated in items (i),
(ii), and (iii) above for calendar year 2012. If in subsequent years, the actual costs
delineated in items (i), (ii), and (iii) above increase to levels in excess of the 2012 levels,
then Lessee shall, within 30 days following the end of each calendar year, reimburse
Lessor for 71% of such increase above 2012 levels; provided, however, the increased
variable facilities maintenance surcharge assessed to Lessee shall not exceed the prior
year's variable amount multiplied by the increase, if any, in the Consumer Price Index
plus 1%. [For example, if the Effective Date is January 1, 2013 and if in 2014 Lessee's
71% share of the actual costs delineated in items (i), (ii) and (iii) is $6,500, and the CPI
increases 2%, then Lessee's 71% share of such costs for 2014 shall be limited to
$4,241.54 (prior year variable amount of $4,118 x 1.03), in which event the aggregate
facilities maintenance surcharge would be limited to $7,318.54 for 2014.] In the event
that the costs of central plant preventive maintenance contracts result in an overall
increase in the facilities maintenance surcharge exceeding five percent (5%) in the
aggregate in any calendar year, or in the event that new central plant preventive
maintenance contracts are necessary after any applicable warranty periods expire, then
upon request from Lessee the Lessor shall seek bids from alternative providers for mutual
review and approval by Lessor and Lessee. Lessor shall be obligated to maintain the
central plant facilities in good working condition; Lessor and Lessee, or their respective
representatives, shall make annual inspections of the central plant facilities and of the
then current mechanical preventative maintenance contractors to determine the
compliance with required levels of upkeep and efficiency of the central plant and the
furnishing of heated and chilled water. Any deficiencies shall be noted and addressed
within sixty (60) days by Lessor, with the necessary resolution of any such deficiencies
being promptly reported in writing to Lessor and Lessee. Seventy-one percent (71%) of
any maintenance expense savings realized from the replacement of central plant facilities
shall be applied to reduce on a dollar for dollar basis the facilities maintenance surcharge
charged to Lessee. In addition, Lessor and Lessee shall each make a monthly payment of
$1,000 which shall be deposited into a joint account for central plant mechanical
expenditures related to heated and chilled water systems maintenance expenditures which
are not covered by preventive maintenance contracts.
SECTION 5.2: RENTS AND OTHER PAYMENTS NOT
SUBORDINATED. Neither the Rents reserved herein and payable by the Lessee or any
other sums required to be paid by the Lessee to the Lessor hereunder shall be
subordinated to the payment of any other amounts, including but not limited to, the
payment of any indebtedness secured by a mortgage on the leasehold estate granted
hereby.
13
1160171-v1
SECTION 5.3: GAMING. In the event that gaming is legalized or authorized in
the State of Arkansas, Pulaski County and the City of Little Rock, it is hereby agreed that
the Demised Premises may be used for such gaming purposes, but only pursuant to
licensing from the appropriate governmental authority and in such event, the Lessee
hereby covenants and agrees with the Lessor that the Lessee shall pay to the Lessor, as
additional rent hereunder on the same payment schedule as the Annual Rent Amount is
paid, a percentage of the Lessee's annual net gaming win derived by the Lessee from
gaming equal to the percentage charged by the owners of other reasonably comparable
type of facilities in the states adjoining Arkansas where gaming is permitted and
conducted from leased premises, which shall be agreed on by the parties. In the event
they are unable to agree on the appropriate percentage, the parties shall select a national
accounting firm experienced in gaming accounting to set the percentage. Lessee shall be
solely responsible for all associated license and permit fees and costs.
ARTICLE VI
NONENCUMBRANCE OF DEMISED PREMISES
PERMITTED MORTGAGE FINANCING
SECTION 6.1 ENCUMBRANCE OF DEMISED PREMISES.
(a) Encumbrances. Except as provided in Subsections (a) and (b) hereof and
except with Lessor's prior written consent, the Lessee covenants and agrees for itself, its
permitted successors and assigns, and every permitted successor in interest to the
Demised Premises (collectively for purposes of this Article VI the "Lessee"), not to
engage in any financing or other transaction creating any mortgage or other encumbrance
or lien upon the Demised Premises whether by express agreement or operation of law,
and not to place upon the Demised Premises, or suffer to be placed upon the Demised
Premises, any lien or other encumbrance, other than a lien upon the Demised Premises
for current real estate taxes and assessments, levied but not then due and payable, and not
to suffer any levy or attachment to be made on the Demised Premises. Any mortgage,
encumbrance or lien made in violation of this covenant shall be deemed a violation of
this covenant on the date of its execution or filing of record regardless of whether or
when it is foreclosed or otherwise enforced.
Notwithstanding any other provisions contained herein, it is expressly agreed
between the Lessor and the Lessee that the Lessee shall be free to create, substitute or
refinance any mortgage lien or security interest for any amount upon the Demised
Premises or the leasehold estate of the Lessee or the Lessee's limited liability company or
other entity interests; provided, however, that this shall not be deemed an agreement on
the part of the Lessor to subordinate its fee simple interest in the Demised Premises to the
lien of any Permitted Mortgage now or later placed on the Demised Premises or leasehold
estate of the Lessee in the Demised Premises.
(b) Mortgages to Finance Acquisition, Renovation and Enhancement Work, or
Other Purposes of Lessee. The Lessee and its members and affiliates may and shall have
14
1160171-v1
the right to encumber, pledge or convey its right, title and interest in and to its leasehold
estate in the Demised Premises and their member interests, by way of a mortgage, deed
of trust or indenture or security agreement ("Permitted Mortgage") to finance the
acquisition of the leasehold estate and the Renovation and Enhancement Work (including
the procurement of furniture, furnishings, fixtures and equipment used in connection with
the operation of the Demised Premises), or refinance any loan or loans obtained by the
Lessee to finance the acquisition of the leasehold estate and the Renovation and
Enhancement work (including the procurement of furniture, furnishings, fixtures and
equipment used in connection with the operation of the Demised Premises), or to finance
other purposes determined by Lessee. Nothing in this Lease Agreement shall be deemed
an agreement on the part of the Lessor to subordinate its fee simple interest in the
Demised Premises to the lien of any Permitted Mortgage placed on the leasehold estate of
the Lessee in the Demised Premises. Lessor further agrees that any Permitted Mortgagee
of the leasehold estate shall have the right, in the event of taking possession of the
Demised Premises or upon Lessee's default pursuant to the Permitted Mortgage, to cure
any defaults by Lessee and to quiet possession of the Demised Premises, and such
possession shall not be disturbed by Lessor as long as the Permitted Mortgagee pays the
rent and complies with the other obligations imposed upon Lessee which accrue on and
after the date of their taking possession of the Demised Premises.
(c) Notwithstanding anything to the contrary in this Lease Agreement, it is
expressly agreed by and between the Lessor and the Lessee and (by acceptance of the
Permitted Mortgage) any Permitted Mortgagee of the leasehold estate that the Lessee's
right to place a Permitted Mortgage against the Demised Premises is subject to the
following:
(1) That at the time the Permitted Mortgage is made, the Lessee has
not been notified of any default which is continuing or uncured under this Lease
Agreement;
(2) That no Permitted Mortgagee or anyone claiming by, through or
under the Permitted Mortgagee, shall, by virtue of it, acquire any greater rights in the
Demised Premises than the Lessee had under this Lease Agreement; and
(3) That the Permitted Mortgage shall be expressly subject and
subordinate to Lessor's interest in all conditions and covenants of this Lease Agreement
and to the rights of the Lessor. The Permitted Mortgagee of any Permitted Mortgage and
the owner of the indebtedness secured by the Permitted Mortgage upon acquiring
ownership of the legal and equitable title to the Demised Premises shall take the title
subject to the covenants of this Lease Agreement. In the event of any conflict between
Section 6.1(a) and 6.1(b), Section 6.1(b) shall control.
(d) Lessee to Notify Lessor of Permitted Mortgage and Furnish Names and
Addresses of Permitted Mortgagees. The Lessee shall notify the Lessor in advance of the
execution and delivery of any Permitted Mortgages filed or recorded against the Demised
Premises or leasehold estate and shall promptly furnish the Lessor with a copy of the
15
1160171-v1
Permitted Mortgage executed pursuant to this Lease Agreement and true and correct
copies of all of the instruments of indebtedness, Permitted Mortgage and other security
related to any Permitted Mortgage and the name and address of the Permitted Mortgagee.
(e) Lessee to Notify Lessor of Other Encumbrance. The Lessee shall also
promptly notify the Lessor of any other lien or encumbrance which has been created on
or attached to the Demised Premises, whether by act of the Lessee or otherwise, of which
Lessee has Notice.
SECTION 6.2: PROTECTION TO PERMITTED MORTGAGEE. In the
event there is a conveyance by way of a Permitted Mortgage of Lessee's leasehold
interest in the Demised Premises of which the Lessor has received notice as provided in
Section 6.1(d), the Lessor agrees that it will not accept a voluntary surrender of the
Demised Premises or a voluntary cancellation of this Lease Agreement from the Lessee
prior to the termination of this Lease Agreement by lapse of time and will not make any
material amendment of this Lease Agreement without, in each case, the prior written
consent of each Permitted Mortgagee under this Lease Agreement.
SECTION 6.3: RIGHT OF PERMITTED MORTGAGEE TO MAKE A
NEW LEASE AGREEMENT. If the Permitted Mortgagee or other party should
succeed to the rights of the Lessee hereunder by reason of the uncured default of the
Lessee or because of any foreclosure or any other action in lieu of foreclosure, then
within 60 days after the Permitted Mortgagee or other party shall have succeeded to
Lessee's rights hereunder, the Permitted Mortgagee or other party shall have the right to
enter into a new lease with the Lessor; provided, however, that prior to the making of any
such new lease the Permitted Mortgagee or other party shall have furnished satisfaction
to the Lessor for payment of any and all liability, costs, claims and expenses arising out
of the cancellation of the Lease Agreement by and between the Lessor and Lessee and the
making of a new lease with the Permitted Mortgagee or other party, and the Permitted
Mortgagee shall have cured all defaults on the part of the Lessee which are susceptible of
being cured by payment of money. This right shall be exercisable, if at all, only by notice
in writing from the Lessee to and received by the Lessor within 60 days after the
Permitted Mortgagee or other party shall have succeeded to Lessee's rights hereunder.
The new lease shall be for the remainder of the term of this Lease Agreement and any
renewals and shall otherwise contain the same terms and conditions as are herein set forth
(except for requirements which are no longer applicable because they have already been
performed). Lessor shall not disturb the Permitted Mortgagee's or other party's
possession of the Demised Premises during the Term of this Lease Agreement as long as
such Permitted Mortgagee or other party complies with the provisions of this Lease
Agreement.
SECTION 6.4: PERMITTED MORTGAGEE'S GRACE PERIOD TO
CURE DEFAULTS OR TO FILE FORECLOSURE PROCEEDINGS. If the Lessee
is in default under this Lease Agreement by reason of the occurrence of any Event of
Default set forth in this Lease Agreement, the Lessor will not terminate this Lease
Agreement or invoke its right to take possession of the Demised Premises if: (i) the
16
1160171-v1
Permitted Mortgagee shall cure the default within the time and in the manner provided
for in this Lease Agreement; or if(ii) in the case of any Event of Default described in
Article XXV, within thirty days after notice of the default by the Lessor to the Permitted
Mortgagee, the Permitted Mortgagee commences a foreclosure or action for possession
under the laws of the State of Arkansas or the United States of America and diligently
proceeds in good faith with its foreclosure (including seeking in good faith to be put in
possession as Permitted Mortgagee or to obtain the appointment of a receiver in
foreclosure), and seeks in good faith to cure or cause to be cured all defaults under this
Lease Agreement and if, and only as long as, the Permitted Mortgagee fully performs all
of the obligations of the Lessee under this Lease Agreement except the curing of those
defaults which cannot be cured until Permitted Mortgagee is in possession of the
Demised Premises or which cannot be cured within such period; provided, however, that
the Permitted Mortgagee commences such cure and diligently pursues such cure.
Notwithstanding the preceding provisions of this Section, the Lessor may invoke any and
all of its remedies under this Lease Agreement, including the remedy of termination if: (i)
a trustee in bankruptcy, a receiver, or any other officer of a court or governmental agency
(other than a receiver, trustee, or any other officer appointed by a court of competent
jurisdiction on motion of the Permitted Mortgagee) shall take possession of the Demised
Premises; and (ii) the Permitted Mortgagee fails to diligently seek to cause possession of
the Demised Premises to be relinquished by any trustee in bankruptcy, receiver or officer
of a court or governmental agency; and (iii) the Permitted Mortgagee fails to cure all
defaults of Lessee under this Lease Agreement except those defaults which cannot be
cured until the Permitted Mortgagee completes its foreclosure in good faith and with
diligence. In the event the purchaser at foreclosure sale or the assignee of the purchaser
acquires the Demised Premises and/or the Lessee's interest in the Demised Premises, the
purchaser or assignee of the purchaser (subject to the Lessor's reasonable right of
approval of any purchaser or assignee of the purchaser other than the Permitted
Mortgagee or an affiliate controlled by it, which approval shall not be unreasonably
withheld) shall then become the Lessee under this Lease Agreement and shall be
obligated to assume and by taking possession of the Demised Premises, it shall assume
and perform each and all of the Lessee's obligations and covenants hereunder. Lessor
shall not disturb the Permitted Mortgagee's or other party's possession of the Demised
Premises during the Term of this Lease Agreement as long as such Permitted Mortgagee
or other party complies with the provisions of this Lease Agreement.
SECTION 6.5: COPY OF NOTICE OF BREACH OF COVENANT OR
DEFAULT. Whenever the Lessor, pursuant to this Lease Agreement, shall deliver any
notice or demand to the Lessee with respect to any breach of covenant or default by
Lessee in any obligation of Lessee under this Lease Agreement, the Lessor shall, at the
same time, furnish a copy of written notice or demand to any Permitted Mortgagee and
any existing franchisor at the last address of that Permitted Mortgagee and franchisor as
shown in the records of the Lessor. Conversely, any Permitted Mortgagee shall forward a
similar notice to Lessor in the event of any alleged or declared default of the Lessee
under any Permitted Mortgage permitted under this Lease Agreement, or any other
instrument related to it.
17
1160171-v1
SECTION 6.6: RIGHT OF PERMITTED MORTGAGEE TO CURE
BREACH OR DEFAULT BY LESSEE, Any Permitted Mortgagee or existing
franchisor shall have the right, at its option, and within a period of the later to occur of 30
days after receipt of notice from Lessor as provided in Section 6.5, or 30 days after
receipt of notice from the Lessor that Lessee has not cured or remedied its breach or
default within the grace period provided for in this Lease Agreement, to cure or remedy
any breach of covenant or default by the Lessee under this Lease Agreement, and as to
any breach or default which cannot be cured within such 30 days, the Permitted
Mortgagee or existing franchisor, as applicable, shall commence and diligently pursue
cure of such default. Any Permitted Mortgagee may add the cost of so curing or
remedying the breach of covenant or default to the debt secured by the Permitted
Mortgage and to the lien of the Permitted Mortgage.
SECTION 6.7: LESSOR TO NEGOTIATE WITH MORTGAGEE. Lessor
hereby covenants and agrees to negotiate in good faith from time to time with one or
more mortgagees or prospective mortgagees with respect to those terms of this Lease
Agreement which affect or impact upon the financability of this Lease Agreement, it
being the intention of Lessor to enter into a lease which Lessee shall be able to finance
and/or mortgage from time to time. Lessor shall promptly furnish to any Permitted
Mortgagees such Estoppel Certificates or Non-Disturbance Agreements as may be
reasonably required by such Permitted Mortgagees.
ARTICLE VII
ADDITIONAL CONDITIONS OF LEASE AGREEMENT AND RESTRICTIONS
UPON
USE OF DEMISED PREMISES
The Lessee, and every other Person who is a beneficiary of the Lessee or a
permitted successor in interest in or to any part of the Demised Premises and who is able
to control the use, occupancy and/or operation of the Demised Premises under the terms
of this Agreement, in addition to all other conditions and restrictions described in this
Lease Agreement or in any Exhibit to it, shall be subject to the following covenants and
agreements which shall run with the Demised Premises, to-wit:
SECTION 7.1: FRANCHISE. (a) Lessee covenants and agrees with the Lessor
that the Lessee shall own, rename, operate, renovate, repair, maintain, manage and
market the Demised Premises initially as a Marriott Hotel and subsequently throughout
the Term of this Lease Agreement as an Approved Hotel (provided, however, Lessee
shall have the option to elect to continue to operate as The Peabody Hotel for all of any
portion of the initial six (6) months of the Term of this Lease Agreement) under and
pursuant to the terms and provisions of a fully executed franchise agreement and the
Lessee further covenants and agrees that Lessee shall own, operate, renovate, repair,
maintain, manage and market the Demised Premises initially as a Marriott Hotel (and
subsequently throughout the Term of this Lease Agreement as an Approved Hotel) under
the franchise agreement and in accordance with the operating and maintenance standards
18
1160171-v1
initially of a Marriott Hotel (and subsequently throughout the Term of this Lease
Agreement as an Approved Hotel) in effect from time to time.
(b) So long as no event of default has occurred hereunder which remains
uncured within any applicable grace periods, Lessee may at its election own, operate,
renovate, repair, maintain, manage and market the Demised Premises under a franchise
agreement as any other Approved Hotel. If the Lessee exercises its election, then and in
that event, the Lessee covenants and agrees with the Lessor that the Lessee shall
thereafter and throughout the term or terms hereof own, operate, renovate, repair,
maintain, manage and market the Demised Premises under and in accordance with a
franchise agreement as one of the Approved Hotels and none others except with the prior
written consent of the Lessor.
(c) On every 5-year anniversary date of this Lease Agreement, the parties may
review the list of Approved Hotels and by mutual agreement amend it as they may deem
appropriate to maintain the standard of operation and maintenance for the Demised
Premises comparable to those of the Approved Hotels on the Effective Date.
(d) That portion of the Demised Premises consisting of the Conference Center
shall not be used as guest rooms for overnight stays,but as a conference center.
SECTION 7.2: INCORPORATION OF FRANCHISE STANDARDS. Lessee
represents to Lessor that each of the Approved Hotels has a set of standards and
conditions precedent which must be met in order to comply with the applicable franchise
agreement. Accordingly Lessee covenants and agrees with Lessor that, subject to the
prior written consent of the franchisor, within 90 days of the Effective Date hereof,
Lessee will make good faith efforts to obtain a written statement of all standards and
conditions precedent which the Lessee must meet and complete in order to be granted the
Marriott Hotel franchise agreement. Furthermore, should Lessee elect to exercise its
options as stated in Section 7.1(b) above to own, operate, maintain and market the
Demised Premises as one of the Approved Hotels, then Lessee covenants and agrees that,
subject to the prior written consent of the applicable Approved Hotel, within sixty (60)
days of the exercise of its election the Lessee will make good faith efforts to obtain a
written statement of all standards and conditions precedent which the Lessee must meet
and complete in order to be granted the applicable franchise agreement of one of the
Approved Hotels.
Except as to defaults in monetary obligations owed by Lessee to Lessor pursuant
to this Lease Agreement and subject to the rights granted pursuant to any Permitted
Mortgage, Lessor and Lessee understand and agree that the performance standards and
other requirements of the franchisor of an Approved Hotel shall have priority over any
such requirements of this Lease Agreement and that satisfactory compliance with such
franchisor's requirements shall constitute compliance with any similar requirements of
this Lease Agreement. Lessor further agrees that any then applicable franchisor of the
Approved Hotel shall have the right to cure any defaults by Lessee under this Lease
Agreement. The rights to cure granted to the franchisor of the Approved Hotel shall also
19
1160171-v1
be granted to any substitute franchisor of an Approved Hotel. If for any reason the
franchise of the Approved Hotel is terminated, Lessee shall have six (6) months thereafter
within which Lessor shall have the right to appoint a substitute franchisor of an Approved
Hotel. Lessee shall have the right, in the interim, to continue to operate the Hotel as
reasonably necessary until such substitute franchisor of an Approved Hotel shall have
been appointed.
SECTION 7.3: COVENANT TO RENOVATE, OPERATE, MAINTAIN
AND REPAIR IN CONFORMITY WITH THE REOUIREMENTS OF THE
FRANCHISE. At all times during the term and any renewal terms hereof, Lessee
covenants and agrees with Lessor that Lessee will own, renovate, operate, maintain,
occupy, repair, market and possess the Demised Premises in substantial conformity with
the terms, provisions, covenants, conditions, requirements and obligations of this Article
VII. Upon Lessor's written request, Lessee will provide to Lessor copies of the
franchisor's (initially Marriott) most recent periodic inspection reports, if any, for the
Hotel to the extent permitted by the applicable franchisor or otherwise allowed by the
then applicable franchise or license agreement for the Approved Hotel.
SECTION 7.4: CERTAIN CONDITIONS OF LEASING. The Lessee shall:
(a) Devote and operate the Demised Premises only for those uses specified
herein and allowed by applicable laws and ordinances; and,
(b) In conformity with all local, state and federal laws and regulations
prohibiting discrimination with regard to hiring, promotion and operation.
ARTICLE VIII
ASSIGNMENT AND TRANSFERS
OF DEMISED PREMISES
SECTION 8.1: LESSEE ACKNOWLEDGMENTS. The Lessee
acknowledges and confirms to the Lessor that any Disposition is for practical purposes a
sale, transfer, assignment or conveyance or disposition of the leasehold in the Demised
Premises then leased by the Lessee and that the qualifications and identity of the Lessee
and the Member are of particular concern to the Lessor. Further the Lessee
acknowledges and confirms that it is because of such qualifications and identity that the
Lessor is entering into this Lease Agreement and in doing so, is further willing to accept
and rely on the obligations of the Lessee for the faithful performance of all undertakings
and covenants by it to be performed.
SECTION 8.2: PROHIBITION AGAINST TRANSFER OF THE LEASE
AGREEMENT OR LEASEHOLD ESTATE AND ASSIGNMENT. For the
foregoing described reasons, and except for customary licenses or sub-leases of space for
operations of specialized products or services such as restaurants, gift shops, newspaper
stands, coffee shops, spa and health clubs, and similar facilities for the benefit of guests,
or as otherwise permitted by this Lease Agreement, without the prior written approval of
20
1160171-v1
the Lessor, Lessee has not made or created (and will not make or create, or suffer to be
made or created) any total or partial sale, assignment, conveyance, or transfer of part or
all of the leasehold estate granted hereby or the Demised Premises or make any
Disposition, or contract or agree to do so (unless such contract or agreement is made
expressly subject to Lessor's consent); PROVIDED, HOWEVER, the Lessor's consent to
any such sale, assignment, conveyance, transfer or Disposition may only be withheld and
denied if the Lessee fails to demonstrate to the Lessor's reasonable good faith satisfaction
that (i) the proposed successor lessee or transferee has the financial capability to fully
perform the Lessee's obligations hereunder, and, (ii) the proposed successor lessee or
transferee, either personally or as a result of contractual engagements, has the
qualifications to own, operate and maintain the Demised Premises as a Full Service
convention center hotel and perform the concession granted herein. Lessee shall have no
right to contest said successor lessee's qualifications under (i) above if the successor
lessee has a net worth, computed in accordance with GAAP of at least $10 million and
under (ii) above if said successor lessee is acceptable to an Approved Brand. Upon the
consummation of any Disposition as provided for in this Section, Lessee shall reimburse
(or cause to be reimbursed to Lessor) any of Lessor's direct out of pocket reasonable
expenses to any third party incurred as a result of such disposition, but in any event not to
exceed $50,000.
SECTION 8.3: LESSEE NOT RELIEVED OF OBLIGATIONS BY
DISPOSITION OR TRANSFER OF DEMISED PREMISES OR ASSIGNMENT
OF LEASE AGREEMENT. The Lessee covenants and agrees that it will not make any
sale, assignment, conveyance or transfer of the Lease Agreement, the leasehold estate
created hereby or the Demised Premises or make any Disposition, as defined in Section
1.1(i), except in conformity with the terms of this Agreement. Upon the written consent
of the Lessor to any sale, assignment, conveyance or transfer of the Lease Agreement, the
leasehold estate created hereby or the Demised Premises or any Disposition, the Lessee
shall, upon such sale, assignment, conveyance, transfer or Disposition and the assumption
by the successor lessee or transferee of all obligations under this Agreement, be fully
released of and from its obligations and liabilities under this Agreement; otherwise, no
Disposition or any sale, conveyance, assignment, or transfer of the leasehold estate
granted hereby or the Demised Premises shall be deemed to relieve the Lessee, or any
other party bound in any way by this Lease Agreement or otherwise with respect to the
obligations under the Lease Agreement.
SECTION 8.4: ASSIGNEE'S LIABILITY. Unless otherwise agreed to by the
Lessor and Lessee, if an assignment shall be made by Lessee or any successor of the
Lessee pursuant to and after complying with the conditions and in the manner set forth in
this Article VIII, the assignee shall be subject to the same terms and conditions as to
future assignments, and to all the covenants, agreements, provisions and conditions
contained in this Lease Agreement.
21
1160171-v1
7
ARTICLE IX
EXCEPTED PREMISES
SECTION 9.1: EXCEPTED PREMISES. Lessor covenants and agrees with
the Lessee that the Lessor shall keep, maintain, operate and repair the Excepted Premises
(including, without limitation, the Statehouse Convention Center) and all personal
property owned by the Lessor used in connection with the operation of the Excepted
Premises or of the Demised Premises in a condition reasonably comparable to the public
spaces and meeting rooms in the Demised Premises and to similar levels of decor and
finish as those of the franchise requirements of Marriott or the other applicable Approved
Hotel. Such obligation of Lessor shall include, without limitation, the operation of the
Statehouse Convention Center as a premier convention center in the City of Little Rock
throughout the Term of this Lease Agreement and any Renewal Terms. Furthermore, the
Lessor covenants and agrees with the Lessee that the Lessor shall establish and annually
fund a maintenance and replacement reserve account in an amount sufficient to enable
Lessor to keep, maintain and repair the Excepted Premises and all personal property
owned by the Lessor used in connection with the operation of the Excepted Premises or
of the Demised Premises in such condition. The current maintenance and replacement
reserve account established by Lessor as of the Effective Date shall be in the sum of not
less than $1,000,000.00, and the initial annual payment by Lessor into the maintenance
and replacement reserve account shall be in the sum of$500,000.00.
SECTION 9.2: OBLIGATION TO OPERATE AND RECONSTRUCT
EXCEPTED PREMISES. Lessor covenants and agrees that it will throughout the terms
hereof so long as no Event of Default as defined by Article XXV hereof has occurred and
remains uncured at the expiration of any applicable grace period, operate the Excepted
Premises continuously in accordance with the standards set out in Section 9.1 above, and
repair and reconstruct any damage or destruction to the Excepted Premises and that such
repair and reconstruction shall restore the Excepted Premises at least to the condition the
same was in prior to the damage or destruction.
In addition thereto, as further provided in Article XX Lessor shall immediately
repair and replace the mechanical renovations consisting of (i) installation of the final
metering phase and mechanical control system for the heated and chilled water system
serving the Demised Premises; and (ii) replacement of the Conference Center water
chiller.
SECTION 9.3: USE OF EXCEPTED PREMISES. The Lessor shall equip,
occupy, staff, own, operate, manage, maintain, repair and replace the Excepted Premises
as a public convention center with related facilities in accordance with the standards set
out in Article IX herein.
SECTION 9.4: REPLACEMENT OF EXCEPTED PREMISES. During the
term hereof and any renewals thereof, Lessor agrees to repair and replace as promptly as
practicable the Excepted Premises in the event of destruction by fire or other casualty.
22
1160171-v1
„—
SECTION 9.5: LESSOR OBLIGATION TO INSURE. (a) At all times
during the term hereof and any renewal term or terms, the Lessor shall, at the Lessor's
sole cost and expense, purchase, procure and maintain the following insurance:
(i) ALL RISK Property insurance on the Excepted Premises in an
amount at least equal to the full replacement cost of the Excepted Premises, with
a maximum deductible at the commencement of the Lease Agreement of Ten
Thousand Dollars for all lines purchased, protecting against loss or damage
by ALL PERILS, including, but not limited to: (i) fire and lightning; (ii) the
risks commonly included within the term "extended coverage” (including
but not limited to windstorm, hail, explosion, riot, riot attending a strike, civil
commotion, aircraft, vehicles and smoke); and (iii) vandalism and malicious
mischief, all as these terms are used in insurance policies from time to time
issued by insurance companies licensed to do business by the State of Arkansas.
If the Lessee decides, based on a reliable appraisal, that the amount of
replacement cost insurance procured by the Lessor is inadequate, then
replacement cost of the Excepted Premises for which insurance shall be
thereafter procured shall be determined every two years during the term of
this Lease Agreement by an appraiser selected and paid jointly by the Lessor
and Lessee. The appraiser shall submit a written report of the appraised
replacement cost to the Lessor and the Lessee. If the Lessor or the Lessee is not
satisfied with this report, this party shall serve upon the other a notice of
dissatisfaction (the notice of dissatisfaction to set forth in a general manner
the grounds for dissatisfaction) within 30 days after receipt of the report.
Unless within 30 days after service of the notice of dissatisfaction the
parties shall have arrived at an agreed replacement cost, the dispute shall be
resolved by the Lessor and Lessee appointing appraisers, then said appraisers
selecting a third appraiser, with the average of the three appraisals being the
valuation for purposes of this section. During this period of dispute the Lessor
shall continue to maintain insurance.
Immediately upon receipt of the agreed upon appraiser's report, the
Lessor shall procure and deliver to the Lessee written confirmation from the
insurer or insurers evidencing any increase in insurance which may be
required to comply with the provisions above.
(ii) Boiler and machinery insurance on a comprehensive basis
covering repair and replacement of all boilers and machinery serving or
benefiting the Excepted Premises, the policies of insurance to be endorsed so
as to provide "use and occupancy" coverage for the Excepted Premises in the
amount of at least 90% of the replacement costs thereof
(iii) Comprehensive commercial general public liability or its
contemporary equivalent on an occurrence basis and property damage
insurance, including but not limited to elevator, premises and operations,
owners and contractors protective coverage; product and completed operations
coverage, fire damage, legal liability, personal and advertising injury,
23
1160171-v1
medical payments, broad form property damage coverage including completed
operations, blanket contractual liability insurance, personal injury coverages,
and contingency liability coverages, protecting and indemnifying the Lessor,
the Lessee, and others reasonably designated by the Lessor or Lessee against
any and all claims (including all costs and expenses of defending against same)
for bodily injury, sickness, disease or death or for damage or injury to or
destruction of property (including loss of use) arising out of ownership,
maintenance or use of the Excepted Premises, the limits of which insurance
shall be not less than One Million Dollars ($1,000,000.00) per occurrence and
Two Million Dollars ($2,000,000.00) general aggregate. The foregoing
insurance shall also include insurance for storage tank liability with respect to
the underground diesel fuel tank which services the emergency generator for
both the Excepted Premises and the Demised Premises.
(iv) Worker's compensation insurance and employer's liability
insurance with a minimum equal to that statutorily required by law covering
all liability imposed under the provision of any worker's compensation law,
employer's liability act or similar laws of the State of Arkansas that may at any
time or from time to time be enacted, or such other amount as may be required
by umbrella policy to effect umbrella coverage.
(v) Business Auto Liability Insurance in the amount of One
Million .Dollars combined single limits for bodily injury and/or property
damage liability including, (i) owned autos, (ii) hired or borrowed autos, and
(iii) non-owned autos.
(vi) Umbrella Insurance on a follow form basis with a per
occurrence and annual aggregate limit of not less than Nine Million Dollars
($9,000,000.00) per occurrence for bodily injury and/or property damage
liability listing the general liability, employer's liability and comprehensive auto
liabilities policies required as underlying policies. Coverage shall be excess of
commercial general public liability (including product completed operations
coverage), auto liability and employer's liability with such coverage being
concurrent with and not more restrictive than underlying insurance.
(vii) Insurance company certificates evidencing the existence of
all of these policies of insurance and the respective interests of Lessor and
Lessee shall be delivered to the Lessee. All general liability policies shall
show the Lessee as an Additional Insured and all certificates shall provide
that they shall not be amended or canceled on less than 30 days' prior written
notice to the Lessee and all insureds and beneficiaries of the policies. The
Lessee shall have no obligation to pay premiums or make contributions to
the insuring company or any other person. Not less than 30 days prior to the
expiration date of any policy required to be carried pursuant to this Article,
the Lessor shall deliver to the Lessee insurance company certificates
evidencing all policies of insurance and renewals required to be maintained.
(viii) All insurance proceeds paid for a loss under (a) above shall be
24
1160171-v1
applied and paid toward repairing and restoring the Excepted Demised.
(ix) All policies required shall be primary and non contributory
except with respect to commercial general public liability insurance of Lessor
covering the Lessee's day to day operations of the property within the scope
of Lessee's activities.
ARTICLE X
RESERVATION, EASEMENTS, AND OTHER
PROVISIONS,RELATIVE TO THE
EXCEPTED PREMISES AND DEMISED PREMISES
SECTION 10.1: EASEMENTS. The Lessor and Lessee reserve to themselves,
their guests, invitees, successors and assigns, and to any utility company the following
permanent and perpetual rights in and to the Demised Premises and the Excepted
Premises: reasonable rights of ingress and egress to and from interests and areas
necessary for the operation, maintenance and repair of the Demised Premises and
Excepted Premises, including installation, operation, maintenance, repair, replacement,
relocation, and removal of water lines, sanitary and storm sewers, gas mains, electrical
power lines, telephone lines and other utility lines and facilities, for support and access to
and within the respective areas for the effective use and operation of the Demised
Premises and Excepted Premises (including, in particular, operation and maintenance by
the Lessee of the public's right to ingress and egress Riverfront Park by way of the
elevators in the Conference Center and the Concourse portions of the Demised Premises),
but subject to any franchisor requirements or reasonable security measures consistent
with safety of life and property, 24 hours a day, 7 days a week; provided that the exercise
of any entry and other rights under this reciprocal easement grant shall not unreasonably
interfere with security measures or the use and enjoyment by any party of interests, sites
or areas or by anyone claiming by, through or under the respective party to this Lease
Agreement.
SECTION 10.2: STRUCTURAL SUPPORT. If due to the fault or negligence
of Lessee, the structural support for any portion of the Demised Premises is reduced
below the support required for the structural integrity and safety of the balance of the
Demised Premises or the Excepted Premises, whether above-grade or below-grade, the
Lessee shall promptly provide substitute adequate structural support. At the request of
the Lessor, the Lessee shall engage the services of a licensed architect or structural
engineer, reasonably acceptable to the Lessor and Lessee, to determine the extent of any
reduction and the adequacy of the remedial or substitute support which shall be
constructed in accordance with plans and specifications prepared by the architect and
reasonably acceptable to the Lessor.
In the event that the architect or structural engineer determines that substitute
structural support is required in a portion of the Demised Premises in which the structural
support has been reduced due to the fault or negligence of Lessee and the Lessee fails to
commence the construction of substitute support within a reasonable time, as determined
25
1160171-v1
by the architect or structural engineer, or having commenced such construction, the
Lessee fails to proceed diligently to its completion, the Lessor shall have the right to
complete the construction of the substitute support. All reasonable costs and expenses
incurred by the Lessor in connection with such construction shall be promptly due and
payable to the Lessor from the Lessee on demand and, if not paid by Lessee on demand,
shall be secured as additional rent and a lien against any insurance proceeds payable to
the Lessee to secure the repayment of that sum of money.
Otherwise, if for any reason other than any reduction due to the fault or
negligence of Lessee, the structural support for any portion of the Demised Premises or
Excepted Premises is reduced below the support required for the structural integrity and
safety of the balance of the Demised Premises or the Excepted Premises, whether above-
grade or below-grade, the Lessor shall promptly provide substitute adequate structural
support. At the request of the Lessee, the Lessor shall engage the services of a licensed
architect or structural engineer, reasonably acceptable to the Lessor and Lessee, to
determine the extent of any reduction and the adequacy of the remedial or substitute
support which shall be constructed in accordance with plans and specifications prepared
by the architect and reasonably acceptable to the Lessee.
In the event that the architect or structural engineer determines that substitute
structural support is required in a portion of the Demised Premises or Excepted Premises
in which the structural support has been reduced other than any reduction due to the fault
i or negligence of Lessee and the Lessor fails to commence the construction of substitute
support within a reasonable time, as determined by the architect or structural engineer, or
having commenced such construction, the Lessor fails to proceed diligently to its
completion, the Lessee shall have the right to complete the construction of the substitute
support. All reasonable costs and expenses incurred by the Lessee in connection with
such construction shall be promptly due and payable to the Lessee from the Lessor on
demand, and if not paid by Lessor on demand, shall be secured as a lien in favor of the
Lessee on the Excepted Premises and on any insurance proceeds payable to the Lessor to
secure the repayment of that sum of money. In the event the Lessor fails to promptly
reimburse Lessee for all such costs and expenses within thirty (30) days of written
demand from Lessee, then Lessee shall have the right to setoff subsequent Rent owed to
Lessor against the obligations owed by Lessor to Lessee.
ARTICLE XI
PAYMENT OF TAXES, ASSESSMENTS
AND OTHER IMPOSITIONS
SECTION 11.1: PAYMENT OF IMPOSITIONS. The Lessee agrees to pay or
cause to be paid as additional Rent, before delinquency and any fine, penalty, interest or
cost is added for nonpayment, all gross receipts tax on hotel and restaurant sales levied by
the City and collected by the Commission, from time to time, and all real estate taxes,
personal property taxes or other ad valorem taxes on tangible property, assessments,
water rates and charges and other governmental charges, general and special, ordinary
26
1160171-v1
and extraordinary, unforeseen as well as foreseen, of any kind and nature whatsoever,
including but not limited to, assessments for public improvements or benefits, which are
assessed, levied, confirmed, imposed or become a lien upon the Demised Premises or the
leasehold estate granted hereby or any or all of them or become payable during the term
of this Lease Agreement, except as otherwise provided for in this Section 11.1. Lessee
shall not be obligated to pay any portion of any such taxes applicable or attributable to
any portion of the Excepted Premises (other than income or sales taxes, or taxes of that
nature, imposed on Lessee relating to its sale of food and beverages on any portion of the
Excepted Premises). The Lessee shall only be responsible for payment of Impositions
that accrue on or after the Effective Date. Notwithstanding any other provision of this
Lease Agreement, the Lessee shall have the right to contest any taxes, charges or
assessments that it disputes and shall not be required to pay any tax so long as the Lessee
shall in good faith proceed to contest the bill by appropriate proceedings.
If by law any Imposition is payable or may at the option of the taxpayer be paid in
installments (whether or not interest shall accrue on the unpaid balance of the
Imposition), the Lessee may pay the same (and any accrued interest on the unpaid
balance of the Imposition), in installments as they respectively become due and before
any fine, penalty, interest or cost is added for the nonpayment of any installment and
interest. Any Imposition relating to a fiscal period of the taxing authority, a part of which
period is included within the terms of this Lease Agreement and a part of which is
included in a period of time after the termination of the term of this Lease Agreement
(whether or not the Imposition shall be assessed, levied, confirmed, imposed or become a
lien upon the Demised Premises or shall become payable during the term of this Lease
Agreement), shall be adjusted as between the Lessor and the Lessee as of the termination
of the term of this Lease Agreement, so that the Lessor shall pay that proportion of the
Imposition which that part of the fiscal period included in the period of time after the
termination of the term of this Lease Agreement bears to the fiscal period, and the Lessee
shall pay the remainder.
Lessor shall pay any Imposition on or for the Excepted Premises for which it or
the Excepted Premises are determined to be liable.
SECTION 11.2: TAX ON RENTS. If at any time during the term a tax or
excise on rents or income or other tax however described (called "Rent Tax") is levied or
assessed by the State of Arkansas or any political subdivision on account of the Rents or
the interest of the Lessor under this Lease Agreement, and if the Rent Tax is in lieu of or
as a substitute for real estate taxes or other ad valorem taxes, Rent Tax shall be treated as
an Imposition and the Lessee covenants to reimburse the Lessor on account of it to the
extent provided in this Article XI. In no event shall the Lessee be obligated (a) to pay for
any year any greater amount by way of the Rent Tax than would have been payable by
the Lessor had the rentals paid under this Lease Agreement upon which the Rent Tax is
imposed been the sole taxable income of the Lessor for the year in question, or(b) to pay
or to reimburse the Lessor for any tax of any kind assessed against Lessor on account of
any Rent Tax reimbursement.
27
1160171-v1
SECTION 11.3: LESSEE NOT TO PAY CERTAIN TAXES. Nothing in this
Lease Agreement shall require Lessee to pay any franchise, estate, inheritance,
succession or transfer tax that is the financial obligation of and payable by the Lessor.
SECTION 11.4: DEPOSIT ON ACCOUNT OF REAL ESTATE TAXES. In
the event the Lessee defaults in or fails to pay any Imposition before it becomes
delinquent, or within thirty (30) days thereafter, then and thereafter Lessee upon demand
of the Lessor shall deposit with the Lessor on the first day of each calendar quarter after
the Lessee's receipt of the demand aforesaid a sum equal to one-fourth of the last known
general property taxes (or any other ad valorem tax or levy upon the Demised Premises)
to the end that, after this date, there shall always be on deposit with the Lessor an amount
at least equal to the taxes accrued and to accrue to the end of the calendar quarter
following each deposit, for the year which then are most recently ascertainable. Each
deposit when made shall be earmarked and held in trust by the Lessor for the taxes for the
year in which the deposit falls due and if the amount deposited by the Lessee on account
of the accrual of taxes for any period shall be insufficient to pay all of the taxes for that
period when finally ascertained, the Lessee, commencing with taxes accrued in the year
of this date, and billed in the next year, shall promptly upon demand deposit an additional
amount as shall make the total deposit of the period equal the taxes for that period.
In the event the deposits above provided for shall be insufficient, the Lessee shall
make additional deposits with the Lessor in the amount of any deficiency from time to
time on notice from Lessor of the amount or amounts levied or assessed against the
Demised Premises or the Leasehold estate granted hereby or any part thereof. All
deposits held by the Lessor shall be disbursed in accordance with the provisions hereof.
In the event similar deposits on account of real estate taxes are required by the
Lessee's Permitted Mortgagee, deposits required shall be made to Permitted Mortgagee
(as the case may be) in lieu of to the Lessor, provided the Permitted Mortgagee shall by
written agreement with the Lessor covenant to hold deposits in trust for the payment of
such real estate taxes and so pay them when the same shall be due and payable.
Any deposits made by the Lessee with the Lessor as provided in this Section 11.4
shall be held in trust by Lessor and invested by the Lessor in investments, obligations, or
securities of the United States Government or insured by the United States Government
or in commercial paper, certificates of deposit or other securities or savings accounts as
reasonably directed by the Lessee and approved by the Lessor, which approval shall not
be withheld unreasonably. All interest or other income from these investments shall be
paid over to the Lessee within a reasonable time after receipt, provided the Lessee is not
then in default under the terms of this Lease Agreement in respect of any matter of which
notice of default has been served on the Lessee.
SECTION 11.5: PROOF OF PAYMENT. Upon written request by Lessor, the
Lessee shall furnish to Lessor, within 30 days after the date whenever any Imposition is
payable by or in behalf of the Lessee, official receipts of the appropriate taxing authority,
photocopies or other proof satisfactory to the Lessor, evidencing the payment. If the
28
1160171-v1
Lessor shall have paid any Imposition, it shall promptly provide the Lessee with a
photocopy of each receipt and shall lend and permit the Lessee to retain the original
receipt until its retention shall no longer be required by the Lessee.
SECTION 11.6: TAX BILLS PRIMA FACIE EVIDENCE. The certificate,
advice or bill or duplicate issued by the appropriate official designated by law to make or
issue it or to receive payment of any Imposition indicating the nonpayment of any
Imposition or any forfeiture, tax sale or tax foreclosure, shall be prima facie evidence that
the Imposition is due and unpaid at the time of the issuance of such certificate, advice or
bill or that the property involved has been forfeited or sold for taxes as the case may be.
ARTICLE XII
INSURANCE
SECTION 12.1: INSURANCE ON DEMISED PREMISES. At all times
during the term hereof and any renewal term or terms, the Lessee shall to the extent
commercially available at reasonable premium rates, at the Lessee's sole cost and
expense, but for the mutual benefit of the Lessor and the Lessee, purchase, procure and
maintain the following insurance coverages:
(a) ALL RISK Property insurance, including business interruption, on the
Demised Premises in an amount at least equal to the full replacement cost of the Demised
Premises, with a maximum deductible at the commencement of the Lease Agreement of
Fifty Thousand Dollars for all lines purchased, protecting against loss or damage by ALL
PERILS, including, but not limited to: (i) fire and lightning; (ii) the risks commonly
included within the term "extended coverage" (including but not limited to windstorm,
hail, explosion, riot, riot attending a strike, civil commotion, aircraft, vehicles and
smoke); and (iii) vandalism and malicious mischief, all as these terms are used in
insurance policies from time to time issued by insurance companies licensed to do
business by the State of Arkansas.
If the Lessor reasonably decides, based on a reliable appraisal, that the amount of
replacement cost insurance procured by the Lessee is inadequate, then replacement cost
of the Demised Premises for which insurance shall be thereafter procured shall be
determined every two years during the term of this Lease Agreement by an appraiser
selected and paid jointly by the Lessor and Lessee. The appraiser shall submit a written
report of the appraised replacement cost to the Lessor and the Lessee. If the Lessor or the
Lessee is not satisfied with this report, this party shall serve upon the other a notice of
dissatisfaction (the notice of dissatisfaction to set forth in a general manner the grounds
for dissatisfaction) within 30 days after receipt of the report. Unless within 30 days after
service of the notice of dissatisfaction the parties shall have arrived at an agreed
replacement cost, the dispute shall be resolved by the Lessor and Lessee appointing
appraisers, then said appraisers selecting a third appraiser, with the average of the three
appraisals being the valuation for purposes of this section. During this period of dispute
the Lessee shall continue to maintain insurance.
29
1160171-v1
Immediately upon receipt of the appraiser's report, the Lessee shall procure and
deliver to the Lessor written confirmation from the insurer or insurers evidencing any
increase in insurance which may be required to comply with the provisions above.
During the Rehabilitation and Renovation Work on the Demised Premises or any
part of it, the insurance required in this Section shall be in the form commonly known as
Special Form Builder's Risk or at least its equivalent and shall be in the full estimated
replacement cost of the Demised Premises.
(b) Boiler and machinery insurance on a comprehensive basis covering repair
and replacement of all boilers and machinery serving or benefiting the Demised
Premises, the policies of insurance to be endorsed so as to provide "use and occupancy"
coverage for the Demised Premises in the amount of at least 90% of the replacement
costs thereof
SECTION 12.2: OTHER INSURANCE TO BE CARRIED. At all times
during the term hereof and any renewal term or terms, the Lessee shall to the extent
commercially available at reasonable premium rates, at the Lessee's sole cost and expense
but for the mutual benefit of the Lessor and the Lessee, purchase, procure and maintain
the following insurance coverages:
(a) Comprehensive commercial general public liability or its contemporary
equivalent on an occurrence basis and property damage insurance, including but not
limited to elevator, premises and operations, owners and contractors protective coverage;
product and completed operations coverage, host liquor coverage, fire damage, legal
liability, personal and advertising injury, medical payments, broad form property damage
coverage including completed operations, blanket contractual liability insurance, personal
injury coverages, and contingency liability coverages, protecting and indemnifying the
Lessor, the Lessee, and others reasonably designated by the Lessor or Lessee against any
and all claims (including all costs and expenses of defending against same) for bodily
injury, sickness, disease or death or for damage or injury to or destruction of property
(including loss of use) arising out of ownership, maintenance or use of the Demised
Premises, the limits of which insurance shall be not less than One Million Dollars
($1,000,000.00) per occurrence and Two Million Dollars ($2,000,000.00) general
aggregate. The Lessor shall have the right from time to time during the term of this
Lease Agreement reasonably to require the Lessee to carry greater amounts of the
insurance provided in this Subsection 12.2(a).
(b) Worker's compensation insurance and employer's liability insurance with a
minimum limit equal to that statutorily required by law covering all liability imposed
under the provision of any worker's compensation law, employer's liability act or similar
laws of the State of Arkansas that may at any time or from time to time be enacted, or
such other amount as may be required by umbrella policy to effect umbrella coverage.
30
1160171-v1
(c) In the event of the Lessee's sale, merchandising, transfer or exchange of
alcoholic liquors upon or from any part of the Demised Premises, the Lessee shall, at
least 20 days before the commencement of this activity and continuously after that,
provide the Lessor with insurance in form, substance and with insurers reasonably
satisfactory to the Lessor, with total limits of not less than One Million Dollars
($1,000,000.00) in respect of bodily injury, sickness, disease or death of any one person
resulting from any one occurrence, One Million Dollars ($1,000,000.00) in respect of loss
of means of support, indemnifying the Lessor, the Lessee, and other persons the Lessor
may designate against any and all liability by virtue of any enactment pertaining to the
sale of intoxication liquors.
(d) In the event that any other type of legislation may be enacted imposing
special liability upon the owner of property by virtue of its use for any special purposes,
before the Lessee shall so use the Demised Premises or any part of it, the Lessee shall to
the extent commercially available at reasonable premium rates provide insurance in form
and substance and with insurers and limits reasonably satisfactory to the Lessor
indemnifying the Lessor, the Lessee, and other person the Lessor may designate against
any and all liability.
(e) Business Auto Liability Insurance in the amount of One Million Dollars
($1,000,000.00) combined single limits for bodily injury and/or property damage liability
including, (i) owned autos, (ii) hired or borrowed autos, and (iii) non-owned autos.
(f) Other insurance, in amounts and in form and substance and against
insurable hazards as from time to time during the term of this Lease Agreement
(including but not limited to excavation and/or construction periods, alteration periods,
razing or demolition periods and restoration periods in the event of damage or destruction
or condemnation) may reasonably be required by the Lessor and provided this insurance
and amounts are consistent with insurance being issued by the insurance industry of the
metropolitan area for buildings and operations of the type of building and operation of the
Lessee upon the Demised Premises.
(g) Umbrella Insurance on a follow form basis with a per occurrence and
annual aggregate limit of not less than Nine Million Dollars ($9,000,000.00) per
occurrence for bodily injury and/or property damage liability listing the general liability,
employer's liability and comprehensive auto liabilities policies required as underlying
policies. Coverage shall be excess of commercial general public liability (including
product completed operations coverage), auto liability and employer's liability with such
coverage being concurrent with and not more restrictive than underlying insurance.
(h) All insurance required by this Section to be purchased by Lessee shall
further provide for a maximum deductible at the commencement of the Lease Agreement
of Fifty Thousand Dollars ($50,000.00) for all lines purchased, and Lessee may elect to
self-insure losses up to $1,000,000.00.
(i) All policies required shall be primary and non contributory.
31
1160171-v1
SECTION 12.3: DELIVERY OF POLICIES. All public liability, Worker's
compensation and employer's liability policies shall be retained by the Lessee.
Except as otherwise specifically provided, all other policies of insurance required
to be furnished shall be held by the Lessee with the proceeds to be distributed in
accordance with the terms of this Lease Agreement. Insurance company certificates
evidencing the existence of all of these policies of insurance and the respective interests
of Lessor, Lessee and any Permitted Mortgagee shall be delivered to the Lessor. Subject
to the prior rights of the holder of any Permitted Mortgage, all policies of insurance
required to be provided and obtained hereunder shall show the Lessor as a loss payee —
all general liability policies shall show the Lessor as an Additional Insured and all
certificates shall provide that they shall not be amended or canceled on less than 30 days'
prior written notice to the Lessor and all insureds and beneficiaries of the policies. The
Lessor shall have no obligation to pay premiums or make contributions to the insuring
company or any other person.
Upon the execution and delivery of this Lease Agreement and then not less than
30 days prior to the expiration date of any policy required to be carried pursuant to this
Article, the Lessee shall deliver to the Lessor and the holder of any Permitted Mortgage
the applicable respective policies or insurance company certificates evidencing all
policies of insurance and renewals required to be furnished.
SECTION 12.4: ADJUSTMENT OF LOSS. Subject to the rights of the
holder of any Permitted Mortgage, a loss, if any, under all policies of the character
described in Section 12.1 shall be adjusted and compromised by the Lessor, Lessee and
any Permitted Mortgagee and, subject to the rights of the holder of any Permitted
Mortgage each insurance company is hereby authorized and directed to make payment
for all such losses jointly to the Lessor, the Lessee and the Permitted Mortgagee. Subject
to the rights of the holder of any Permitted Mortgage and except to the extent provided in
Section 16.2 hereof; all insurance proceeds paid for such losses shall be applied and paid
toward repairing and restoring the Demised Premises.
SECTION 12.5: INSURER TO BE APPROVED. All policies of insurance of
the character described in Sections 12.1 and 12.2 shall be written in companies of
recognized responsibility reasonably acceptable to the Lessor. On request by the Lessor,
the Lessee shall provide photocopies of receipts showing the payment of premiums for all
insurance policies required to be maintained by this Lease Agreement.
SECTION 12.6: WAIVER OF SUBROGATION. Whenever: (i) any loss,
cost, damage or expense resulting from fire, explosion or any other casualty or
occurrence is incurred by either of the parties to this Lease Agreement, or anyone
claiming under it in connection with the Demised Premises or Excepted Premises; and
(ii) the party is then covered in whole or in part by insurance with respect to loss, cost,
damage or expense required under this Lease Agreement to be so insured, then the party
so insured (or so required) releases the other party from any liability the other party may
32
1160171-v1
have on account of the loss, cost, damage or expense to the extent of any amount
recovered by reason of insurance (or which could have been recovered had insurance
been carried as so required) and waives any right of subrogation which might otherwise
exist in or accrue to any person on account of it, provided that the release of liability and
waiver of the right of subrogation shall not be operative in any case where the effect
thereof is to invalidate such insurance coverage or increase the cost thereof(provided that
in the case of increased cost, the other party shall have the right, within 30 days following
written notice, to pay the increased cost keeping the release and waiver in full force and
effect).
ARTICLE XIII
USE OF THE DEMISED PREMISES AND ENTIRE BUILDING
SECTION 13.1: NO REPRESENTATIONS BY LESSOR. (a) Lessor has
provided to Lessee an Estoppel Statement in the form attached hereto as Exhibit "F"
describing any hazardous or other adverse conditions of the Demised Premises which are
known to Lessor. Subject to the items described in such Estoppel Statement and in
reliance upon the disclosures made therein by Lessor, the Lessee acknowledges that it has
examined the Demised Premises and other structures including the Excepted Premises
presently located there and knows the patent condition of them and accepts them in their
present condition and without any representations or warranties of any kind or nature
whatsoever by the Lessor as to their condition or as to the use or occupancy which may
be made of them. The Lessee assumes the sole responsibility for the condition,
renovation, alteration and repair of the Demised Premises and other structures, parts,
portions and components thereof, including but not limited to the exterior finishes, roof
and windows, all as located on the Demised Premises in order that Lessee may operate,
maintain, repair and manage the Demised Premises, and the Lessor shall not be required
at any time to furnish any facilities or services to the Demised Premises or to make any
repairs, replacements, changes (structural or otherwise), additions or alterations to the
Demised Premises, or any part, portion or component thereof(including but not limited
to, the exterior finishes, roof and windows), or any other property of any kind demised by
this Lease Agreement, except as otherwise stated in this Lease Agreement.
Notwithstanding the foregoing or any other provision of this Lease Agreement, the
Lessee shall not assume any responsibility or liability for any condition, renovation,
alteration or repair of the Demised Premises occurring or existing prior to the Effective
Date or arising as a result of Lessor's or Prior Lessee's acts or omissions prior to the
Effective Date, except to the extent contemplated in the initial PIP or Lessee's overall
initial capital budget which has been delivered to Lessor (including without limitation
any alterations or repairs proposed by Lessor in writing to Lessee and accepted by
Lessee).
(b) Except with respect to the items described in the aforesaid Estoppel
Statement attached as Exhibit "F" and in reliance upon the disclosures made therein by
Lessor, NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, THE
LESSOR, BY EXECUTION AND DELIVERY HEREOF, AND LESSEE, BY
33
1160171-v1
ACCEPTANCE HEREOF, COVENANT, AGREE AND ACKNOWLEDGE THAT
THE LESSOR HAS NOT MADE AND DOES NOT HEREBY MAKE ANY
REPRESENTATION, WARRANTY OR COVENANT, EXPRESS OR IMPLIED,
WITH RESPECT TO THE AMOUNT OF ACREAGE, MERCHANTABILITY,
CONDITION, QUALITY, DURABILITY, DESIGN, BOUNDARY LINES, ZONING,
LAND USE RESTRICTIONS, BUILDING CODES, ENVIRONMENTAL MATTERS,
INCLUDING BUT NOT LIMITED TO, MATTERS CONCERNING HAZARDOUS
MATERIALS, OPERATIONS, HABITABILITY, FITNESS FOR USE OR
SUITABILITY OF THE DEMISED PREMISES HEREIN DESCRIBED, OR ANY
COMPONENT THEREOF, IN ANY RESPECT WHATSOEVER; NOR DOES THE
LESSOR MAKE ANY OTHER REPRESENTATIONS, WARRANTIES OR
COVENANTS OF ANY KIND, CHARACTER OR NATURE, EXPRESSED OR
IMPLIED WITH RESPECT HERETO OR THE DEMISED PREMISES; SAID
DEMISED PREMISES BEING LEASED TO AND ACCEPTED BY THE LESSEE,
AS IS", "WHERE IS AND "HOW IS", WITHOUT EXCEPTION AND LESSEE
ASSUMES FULL AND COMPLETE RESPONSIBILITY FOR ANY REPAIRS OR
REPLACEMENTS WHATSOEVER. LESSOR REPRESENTS THAT, AS OF THE
EFFECTIVE DATE OF THIS LEASE AGREEMENT, THERE ARE NO DEFAULTS
HEREUNDER; THAT THERE ARE NO CONDITIONS IN EXISTENCE WHICH, TO
THEIR KNOWLEDGE, WOULD GIVE RISE TO AN EVENT OF DEFAULT; AND
THAT ALL RENTS, PAYMENTS AND OTHER CHARGES DUE HEREUNDER
HAVE BEEN TIMELY MADE. Notwithstanding the foregoing provisions, Lessor shall,
{ as between Lessor and Lessee, be solely responsible for all claims and causes of action
related to or arising out of any environmental conditions existing on the Demised
Premises or the Excepted Premises on or prior to the Effective Date.
SECTION 13.2: COMPLIANCE WITH THE LAWS. The Lessee and Lessor
shall throughout the term of this Lease Agreement, at their respective sole expense,
promptly comply with all the laws and ordinances and the orders, rules, regulations and
requirements of all federal, state and municipal governments and appropriate
departments, commissions, boards and officers (whether or not the same require
structural repairs or alterations) and all other Legal Requirements, which may be
applicable from time to time to the use of the Demised Premises and Excepted Premises,
but the foregoing shall not be deemed to relieve the Lessor of its general municipal
obligations. The Lessee and Lessor shall likewise observe and comply with the
requirements of all policies of public liability, fire and all other policies of insurance at
any time in force with respect to the Demised Premises and Excepted Premises.
SECTION 13.3: RIGHT TO CONTEST COMPLIANCE, The Lessee shall
have the right to contest by appropriate legal proceeding, without cost or expense to the
Lessor, the validity of any Legal Requirement of the nature referred to, and if by the
terms of any legal requirement compliance may legally be held in abeyance without the
incurrence of any lien, charge or liability of any kind against the title to the Demised
Premises or the Lessee's leasehold estate and without subjecting the Lessee or the Lessor
to any liability of whatsoever nature for failure so to comply, the Lessee may postpone
34
1160171-v1
compliance until the final determination of any proceedings, provided that all
proceedings shall be prosecuted with all due diligence and dispatch.
SECTION 13.4: USE OF DEMISED PREMISES,. The Lessee shall equip,
occupy, staff, own, operate, manage, maintain, repair and replace the Demised Premises
only as a Full Service Marriott Hotel or other Approved Hotel with related amenities and
Conference Center.
ARTICLE XIV
REPAIRS, MAINTENANCE AND IMPROVEMENTS
SECTION 14.1: REPAIR OF DEMISED PREMISES. The Lessee shall
throughout the term or terms of this Lease Agreement, at the Lessee's sole expense,
continuously keep and maintain the Demised Premises in good, clean and orderly
condition and repair and in a condition consistent with the standards prescribed by Article
VII of this Agreement. The Lessee shall promptly, at the Lessee's own expense, make to
the Demised Premises all necessary repairs, renewals and replacements, interior and
exterior (including the roof and all exterior surfaces and finishes), structural and
nonstructural, whether made necessary or caused by fire or other cause (but in the event
of damage caused by fire or other casualty, only to the extent of insurance proceeds
actually received by Lessee) or by ordinary wear and tear, except as provided in Section
16.1(b) herein. All repairs, renewals and replacements shall be of good quality sufficient
for the proper maintenance and operation of the Demised Premises, again consistent with
the standards prescribed by Article VII hereof Lessee and Lessor agree that the Lessor
shall have no obligation whatsoever to make any repairs or expend any monies for the
maintenance of the Demised Premises or the renewal, replacement or repair of the
Demised Premises.
SECTION 14.2: REPAIR AND REPLACEMENT RESERVES.
Immediately upon execution hereof, the Lessee shall create an account, identified as the
Repair and Replacement Reserves Account, into which account Lessee shall deposit,
beginning in the second full calendar year after substantial completion of the Renovation
and Enhancement Work, three (3%) per cent of the annual room sales derived from the
Lessee's operation of the Demised Premises, but not more than Three Thousand Dollars
($3,000.00) per guest room in the aggregate shall be required to be held in reserve at any
one time. The monies deposited into the Repair and Replacement Reserves Account shall
be held by Lessee or its Permitted Mortgagee and be expended only for the repair and
replacement of the Demised Premises, as determined by Lessee in its sole discretion, and
for no other purpose; Lessor shall be entitled to annual confirmation of the account. In
the event the applicable Approved Hotel franchise or any Permitted Mortgagee requires
Lessee to maintain a repair and replacement reserve, such repair and replacement reserve
required pursuant to the applicable franchise shall be a credit against the Repair and
Replacement Reserve required pursuant to this Section 14.2.
35
1160171-v1
SECTION 14.3: REMOVAL OF DANGEROUS CONDITIONS. The parties
shall during the term of this Lease Agreement, at their respective sole expense, do all
things necessary to remove any known dangerous condition from time to time existing on
the Demised Premises as to the Lessee, and the Excepted Premises as to the Lessor,
including (without limiting the generality of the foregoing) promptly taking appropriate
measures to prevent or repair any erosion, collapse or other unstable condition of each of
the said Demised Premises and Excepted Premises.
SECTION 14.4: ALTERATION OF IMPROVEMENTS. Except in
compliance with the requirements of any applicable PIP or other requirement of the then
applicable franchisor of the Approved Hotel, the Lessee shall not make or permit to be
made any alteration of, addition to, or change in, Demised Premises, nor demolish all or
any part of the Demised Premises, involving a material structural alteration without the
prior written consent of the Lessor, which consent shall not be unreasonably withheld or
delayed. Lessor hereby consents to any alteration, addition, change, or demolition made
in compliance with the requirements of any applicable PIP or other requirement of the
then applicable franchisor of the Approved Hotel. In requesting consent the Lessee shall
comply with all applicable laws and ordinances, and shall submit to the Lessor detailed
plans and specifications of the proposed structural work, an explanation of the needs and
reasons for it, and a plan of full payment of the costs of it and the Lessor shall notify the
Lessee of its approval or objections, as the case may be, as promptly as possible after
reviewing the information, but not exceeding 30 days. If Lessor fails to notify Lessee of
its objections within 30 days, the alterations and/or changes shall be deemed approved.
This section shall not be applicable to upgrades or replacements of the furniture,
furnishings, fixtures, equipment or inventory or to work done in compliance with the
requirements of any applicable PIP or other requirement of the then applicable franchisor
of the Approved Hotel.
If Lessor desires to make or permit to be made any alteration of, addition to, or
change in,.the Excepted Premises, or demolish all or any part of the Excepted Premises,
involving a cost in excess of Five Hundred Thousand Dollars ($500,000.00) (subject to
annual increases based upon increases in the Consumer Price Index from the Effective
Date to each anniversary) it shall first submit its plans for such alteration, addition,
changes or demolition to Lessee for its review, comment, and approval, which shall be
delivered within thirty (30) days from its receipt of Lessor's plans, but the Lessee's
consent to any such alteration, addition, or change to the Excepted Premises shall not be
unreasonably withheld, subject always, however, to the continuing obligation of Lessor
under Article IX, including, without limitation, continuing operation of the Statehouse
Convention Center as a premier convention center in the City of Little Rock.
36
1160171-v1
ARTICLE XV
RIGHT TO PERFORM COVENANTS;
REIMBURSEMENT FOR AMOUNTS SO EXPENDED
SECTION 15.1: PERFORMANCE OF COVENANTS TO PAY MONEY. If
either party shall at any time default in the payment of any Impositions pursuant to the
provisions of Article XI, shall fail to effect any insurance coverage and pay premiums
therefor, or fail to make other payment (other than Rent) when due and the failure shall
continue for ten business days after written notice from the other party, then the other
party may, but shall not be obligated so to do, and without further notice to or demand
and without waiving or releasing the defaulting party from any obligations in this Lease
Agreement contained, pay any Imposition, effect any insurance coverage and pay
premiums for it, or make any other payment in a manner and extent that the other party
may deem desirable to protect the Demised Premises or Excepted Premises.
SECTION 15.2: RIGHT TO CURE DEFAULT. (a) If there shall be an Event
of Default as defined in Article XXV of this Lease Agreement, other than the events
described in Section 15.1 above, which remain uncured upon the expiration of any
applicable grace period, then the Lessor shall have the right, but shall not be required, to
make good any default of the Lessee. Nothing in this Lease Agreement shall imply any
duty upon the part of the Lessor to do any work which, under any provision of this Lease
Agreement, the Lessee is required to perform, and the performance of it by the Lessor
shall not constitute a waiver of the Lessee's default in failing to perform it. The Lessor
may, during the progress of any work elected to be performed by it on the Demised
Premises, enter with contractors, agents and servants and keep and store upon the
Demised Premises or any part of it all necessary materials, tools and equipment. The
Lessor shall not in any event be liable for inconvenience, annoyance, disturbance, loss of
business or other damage of or to the Lessee by reason of bringing materials, supplies and
equipment into or through the Demised Premises during the course of the work, and the
obligations of the Lessee under this Lease Agreement shall not be affected in any manner
whatsoever provided the Lessor uses reasonable care under the circumstances prevailing
to avoid unnecessary inconvenience, annoyance, disturbance, loss of business or other
damage of or to the Lessee.
(b) If the Lessor fails to operate the Convention Center as a premier
convention center in the City of Little Rock or fails to keep and repair the Excepted
Premises in a condition reasonably comparable to the public spaces and meeting rooms in
the Demised Premises, which failure remains uncured after the expiration of any
applicable grace period, then the Lessee shall have the right, but shall not be required, to
make good said failure to keep and repair the Excepted Premises. Nothing in this Lease
Agreement shall imply any duty upon the part of the Lessee to do any work to keep and
repair the Excepted Premises and the performance of it by the Lessee shall not constitute
a waiver of the Lessor's default in failing to perform it. The Lessee may, during the
progress of any work elected to be performed by it to keep the Excepted Premises in a
condition reasonably comparable to the public spaces and meeting rooms in the Demised
37
1160171-v1
1
Premises, enter with contractors, agents and servants and keep and store upon the
Excepted Premises or any part of it all materials, tools and equipment necessary to work
thereon. The Lessee shall not in any event be liable for inconvenience, annoyance,
disturbance, loss of business or other damage of or to the Lessor by reason of bringing
materials, supplies and equipment into or through the Excepted Premises during the
course of the work thereon, and the obligations of the Lessor under this Lease Agreement
shall not be affected in any manner whatsoever provided the Lessee uses reasonable care
under the circumstances prevailing to avoid unnecessary inconvenience, annoyance,
disturbance, loss of business or other damage of or to the Lessor.
SECTION 15.3: LESSOR'S AND LESSEE'S ATTORNEYS' FEES AND
EXPENSES. To the extent not prohibited by law, all expenses, including reasonable
attorneys' fees and court costs, incurred by the parties by reason of any default by the
other party (whether or not any proceeding is instituted) or in connection with any action
or proceeding affecting this Lease Agreement or the Demised Premises, shall be paid by
the party found to be at fault.
SECTION 15.4: REIMBURSEMENT OF LESSOR AND LESSEE. All
sums advanced by either party pursuant to the provisions of Sections 15.1 and 15.2 and
all necessary and incidental costs, expenses and reasonable attorneys' fees in connection
therewith, together with interest at the prime interest rate per annum of J.P. Morgan
Chase Bank, New York, or its successor, from the date of the making of advancements,
shall be promptly payable in the respective amounts so advanced. This reimbursement
shall be made on demand, or, at the option of the party to which reimbursement is due,
may be added to or subtracted from any Rent then due or becoming due under this Lease
Agreement.
ARTICLE XVI
DAMAGE OR DESTRUCTION
SECTION 16.1: REPAIR AND REPLACEMENT OF DEMISED
PREMISES AFTER DAMAGE. (a) Except as stated in (b) below, in the event of
damage by fire or otherwise to the nonstructural elements of the Demised Premises,
including any machinery, fixtures or equipment which are a part of or located on the
Demised Premises, the Lessee shall within six months after settlement with the insurance
carrier and collection of insurance proceeds and as much sooner as is reasonably possible,
at the Lessee's sole expense (understanding that Lessee shall use any insurance proceeds
available for that purpose and shall not be required to expend funds in excess of
insurance proceeds actually received by Lessee), either repair or replace the damaged
nonstructural elements of the Demised Premises, including any machinery, fixtures or
equipment. In the event of damage by fire or otherwise to the structural elements of the
Demised Premises, the Lessee shall within twenty-four (24) months after the damage and
as much sooner as is reasonably possible at the Lessee's sole expense(understanding that
Lessee shall use any insurance proceeds available for that purpose and shall not be
required to expend funds in excess of insurance proceeds actually received by Lessee),
1160171-v1 38
repair and restore the Demised Premises as completely as possible to the condition it was
in immediately prior to the damage or, if the Lessee so elects, replace, within thirty (30)
months after the damage and as much sooner as is reasonably possible at the Lessee's sole
expense (understanding that Lessee shall use any insurance proceeds available for that
purpose and shall not be required to expend funds in excess of insurance proceeds
actually received by Lessee), the Demised Premises with a HOTEL BUILDING and
IMPROVEMENTS of the same general size and character as the damaged HOTEL
BUILDING and IMPROVEMENTS. In either event the repairing, restoring or
replacement shall be done in conformity with and subject to the provisions of Article IV
applicable to the renovation and enhancement of the Demised Premises.
(b) Notwithstanding anything contained herein to the contrary, if such damage
or destruction to the Demised Premises shall occur during the last ten (10) years of the
Term or any Renewal Term, then, and in such event, Lessee may, at its option, elect to
terminate this Lease Agreement by delivering thirty (30) days' prior written notice to
Lessor within a reasonable time following such damage or destruction to the Demised
Premises, in which event after payment to Lessee of the portion of such insurance
applicable to Lessee's furniture, fixtures, equipment, inventory, supplies and business
interruption, and less the actual costs, if any, to the Lessee relating to recovery, the
balance of all insurance proceeds payable on account of such damage or destruction to
the Demised Premises shall be paid over to Lessor, and, upon such election by Lessee,
this Lease Agreement shall terminate, as if by lapse of time, on the effective date of such
notice.
SECTION 16.2: PAYMENT FOR CONSTRUCTION AFTER DAMAGE
OR DESTRUCTION. (a) Subject to the rights of any Permitted Mortgagee, except as
provided in Section 16.1(b) or in subsection (b) below, after payment to Lessee of the
portion of such insurance applicable to Lessee's furniture, fixtures, equipment, inventory,
supplies and business interruption, all insurance proceeds recovered by any party on
account of damage or destruction to the Demised Premises, less the actual costs, if any, to
the applicable party relating to recovery shall be applied to payment of the cost to restore
the Demised Premises.
(b) For purposes of this Section 16.2 only, the term "Loan Period Event of
Damage" as used in this Section 16.2 shall mean an event of damage by fire or otherwise
to the structural elements of the Demised Premises occurring on or after the Effective
Date hereof and before the payment in full of the original principal debt and accrued
interest secured by the Permitted Mortgage. Accordingly, if a Loan Period Event of
Damage occurs, then that portion of the insurance proceeds recovered on account of
damage and destruction to the Demised Premises in an amount sufficient to satisfy the
indebtednesses secured by the Permitted Mortgage shall be applied toward the cost to
repair and restore the Demised Premises or in satisfaction of the indebtednesses secured
by the Permitted Mortgage in accordance with the terms and provisions of the Permitted
Mortgage.
39
1160171-v1
(c) Provided, further, a Permitted Mortgagee entitled to elect between
applying a portion of the property insurance proceeds toward payment of the
indebtednesses secured by the Permitted Mortgage or toward repair by the Lessee of the
Demised Premises, shall make good faith efforts to give Lessor and Lessee written notice
of that election within sixty(60) days of the date of the damage to the Demised Premises
or be deemed to agree that all property damage insurance shall be used by the Lessee to
repair the Demised Premises in accordance Section 16.1 hereof.
(d) Notwithstanding an election by a Permitted Mortgagee to apply a portion
of the property insurance proceeds toward payment of the indebtednesses secured by the
Permitted Mortgage, all insurance proceeds recovered on account of damage or
destruction to the Demised Premises, not used in payment of the indebtednesses secured
by the Permitted Mortgage, shall be used by the Lessee to repair and restore the Demised
Premises as required by Section 16.1 hereof.
SECTION 16.3: RIGHT OF PERMITTED MORTGAGEES TO REPAIR.
In case any Permitted Mortgage made by the Lessee shall be in force at the time of any
damage to or destruction by fire or otherwise of the Demised Premises, and the Lessee is
in default hereunder and its time to cure has expired, any Permitted Mortgagee is
authorized, at its sole expense, to repair or restore the Demised Premises under the same
terms and conditions of this Lease Agreement as would be applicable in the case of a
repairing, restoring or construction by the Lessee. The Permitted Mortgagee so repairing,
restoring or constructing the Demised Premises shall, subject to compliance with all the
conditions contained in this Article XVI, Article IX and Article IV (to the extent
applicable), be subrogated to the rights of the Lessee to all the insurance proceeds
payable as a result of the damage or destruction, and shall be entitled to have all
insurance proceeds paid out in the same manner in every respect as if said Permitted
Mortgagee were Lessee under this Lease Agreement.
SECTION 16.4: COLLECTION OF INSURANCE PROCEEDS. The Lessor
shall in no event be responsible for the noncollection of any insurance proceeds under
this Lease Agreement.
SECTION 16.5: UNUSED INSURANCE PROCEEDS AND DEPOSITS. In
the event any proceeds of insurance shall remain after completion of restoration or
rebuilding, and the Lease is not in default, then the remaining funds shall belong to the
Lessee.
SECTION 16.6: RECIPROCAL OBLIGATIONS OF LESSOR UPON
DAMAGE OR DESTRUCTION OF EXCEPTED PREMISES OR CONVENTION
CENTER. Similar to the obligations of Article XVI of this Lease Agreement imposed
upon Lessee, Lessor shall, in the event of damage or destruction of the Excepted
Premises or Statehouse Convention Center, have the following obligations:
(a) In the event of damage by fire or otherwise to the nonstructural elements
of the Excepted Premises, including any machinery, fixtures or equipment which are a
40
1160171-v1
part of or located on the Excepted Premises, the Lessor shall within six months after
settlement with the insurance carrier and collection of insurance proceeds and as much
sooner as is reasonably possible, at the Lessor's sole expense (understanding that Lessor
shall use any insurance proceeds available for that purpose and shall not be required to
expend funds in excess of insurance proceeds actually received by Lessor plus any
Replacement Reserve), either repair or replace the damaged nonstructural elements of the
Excepted Premises, including any machinery, fixtures or equipment. In the event of
damage by fire or otherwise to the structural elements of the Excepted Premises, the
Lessor shall within twenty-four (24) months after the damage and as much sooner as is
reasonably possible at the Lessor's sole expense (understanding that Lessor shall use any
insurance proceeds available for that purpose and shall not be required to expend funds in
excess of insurance proceeds actually received by Lessor plus any Replacement Reserve),
repair and restore the Excepted Premises as completely as possible to the condition it was
in immediately prior to the damage or, if the Lessor so elects, replace, within thirty (30)
months after the damage and as much sooner as is reasonably possible at the Lessor's sole
expense (understanding that Lessor shall use any insurance proceeds available for that
purpose and shall not be required to expend funds in excess of insurance proceeds
actually received by Lessor plus any Replacement Reserve), the Excepted Premises with
a premier convention center and IMPROVEMENTS of the same general size and
character as the damaged premier convention center and IMPROVEMENTS. In either
event the repairing, restoring or replacement shall be done in conformity with and subject
continuing standards applicable to a premier convention center.
(b) After payment to Lessor of the portion of such insurance applicable to
Lessor's furniture, fixtures, equipment, inventory, supplies and business interruption, all
insurance proceeds recovered by any party on account of damage or destruction to the
Excepted Premises, less the actual costs, if any, to the applicable party relating to
recovery shall be applied to payment of the cost to restore the Excepted Premises.
(c) In the event any proceeds of insurance shall remain after completion of
restoration or rebuilding, and the Lease is not in default, then the remaining funds shall
belong to the Lessor.
ARTICLE XVII
CONCESSIONS
SECTION 17.1: CONCESSION GRANT. The Lessor hereby grants to Lessee
the exclusive right and obligation throughout the term hereof and any extensions and
renewals thereof, but only if the Lessee is not otherwise in default hereunder, to provide
all "Concessions" (as hereinafter defined) within the Excepted Premises (including the
Statehouse Convention Center), and any expansion thereof physically connected to the
Excepted Premises. Lessee will maintain at all times in good standing such permits and
licenses necessary and required to sell and serve alcoholic beverages, beer and wine as
part of the concession; provided, however, Lessee shall allow such organizations and
enterprises as are jointly approved by Lessor and Lessee to provide food service prepared
41
1160171-v1
other than by the Lessee to be served at functions conducted and held in the Excepted
Premises. The term "Concessions" shall be deemed to include all vending machines,
beverage services, banquet service and all other food, drink, food service and other sales
which occur in the Excepted Premises.
SECTION 17.2: LESSEE CONCESSION SERVICES. Lessee accepts the
obligations associated with the concession grant and in consideration for the grant,
Lessee covenants and agrees that throughout the term hereof and any extensions and
renewals thereof, Lessee will fully and completely perform and observe the concession
granted herein and in furtherance thereof covenants and agrees as follows:
(a) To procure and provide adequate vending machines for the Excepted
Premises and to keep same in good clean operating condition and adequately stocked at
all times; and
(b) To meet all reasonable requests and needs to provide and serve food
and/or beverages, including alcoholic beverages, beers and wines, for all conventions,
group meetings, private parties or assemblies using the Excepted Premises and to prepare,
provide and serve all such food and beverages.
SECTION 17.3: STANDARDS OF LESSEE CONCESSION SERVICES.
Lessee covenants and agrees that it will at all times maintain the same standards of food
{ and beverage preparation and service at reasonably comparable prices as are applicable to
the Demised Premises and that same will at all times conform to the requirements of
Article VII.
SECTION 17.4: CONCESSION FEE. As additional consideration for the
concession granted herein, commencing on the Effective Date Lessee shall pay to Lessor
(or its designee, the Little Rock Convention and Visitors Bureau ["LRCVB"]) a
Concession Fee of four percent (4%) of the Lessee's gross receipts derived from the sales
or service of and from the operations of all Concessions conducted by Lessee within the
Excepted Premises, including all sales and service of and from all food, vending and
beverage (including alcoholic beverages, beers and wines) and other items sold by Lessee
within the Excepted Premises through September 30, 2015. Commencing on October 1,
2015, the Concession Fee shall be five percent (5%) of such gross receipts from
Concessions conducted within the Excepted Premises by Lessee during each Lease Year
for the remainder of the Term of this Lease Agreement, including any Renewals thereof.
SECTION 17.5: PAYMENT AND ACCOUNTING FOR CONCESSION
FEE. Throughout the term hereof, and any renewals and extensions thereof, Lessee shall
pay to Lessor the Concession Fee monthly, beginning on the 15th day of each succeeding
month after the Effective Date based on the applicable receipts for the preceding calendar
month. Lessee covenants and agrees to maintain at all times during the term hereof and
any and all renewals and extensions thereof, a complete accounting showing all
applicable receipts earned by the Lessee from sales and service in the Excepted Premises
under the Concession granted hereby and that the applicable receipts upon which the
42
1160171-v1
t
monthly payment is based shall be reported to the Lessor along with each such payment
in a form as approved by the Lessor and Lessee. Lessee or its Manager covenants and
agrees to give Lessor an annual statement certified as correct by its chief financial officer
showing the applicable receipts earned by the Lessee upon which the Concession Fee is
calculated. Such annual report shall be delivered on or before the 15th day of March of
the following calendar year during the term hereof, and such report shall be subject to
review and audit by Lessor's designated accountant at Lessor's sole cost and expense.
SECTION 17.6: KITCHEN EOUIPMENT. The Former Lessee has
heretofore purchased from the Commission the fixtures, systems, equipment and
appliances to be used by the Lessee in the performance of its food and beverage services
in the Excepted Premises. The Lessor will, from time to time, provide, set up and
dismantle a sufficient number of tables, chairs, portable stages and related furniture and
equipment, all of good quality and adequately maintained, to serve the needs of patrons
of the Excepted Premises. In connection with the Concession to be operated by Lessee,
Lessee will set up, dismantle and properly clean within the confines of the Excepted
Premises all other equipment and supplies, including but not limited to, dishes, silver and
linens which are necessary for the service of food and beverages to the patrons of the
Excepted Premises before and after each use by Lessee in connection with its food
services. Lessee will also clean-up, sweep and mop (where applicable) all areas where
food has been prepared, transported and served after each food service function and cause
the removal of all trash and garbage relating to the operation of the concessions.
SECTION 17.7: FURNISHING OF SUPPLIES. Except as above set forth,
Lessee shall furnish all staff, equipment and supplies, including, but not limited to,
dishes, silver and linens which are necessary for the service of food and beverage to the
patrons of the Excepted Premises. Lessee shall be responsible for all trash and garbage
removal relating to the operation of the Concessions.
SECTION 17.8: COSTS OF OPERATIONS. Lessee shall be responsible for
and shall pay all costs of operation of the Concession except as specifically set forth
elsewhere in this Agreement, including, but not limited to, the costs of leasing or
purchasing vending machines and the costs of its own personnel and equipment. All
food, beverage and supplies required to be furnished by Lessee hereunder shall be
purchased by Lessee in its own name and at its own expense, and all supervisory, clerical
and operating personnel necessary to perform Lessee's functions hereunder shall also be
employed by Lessee in its own name and at its own expense. Lessee agrees to hold the
Lessor harmless of and from any and all costs, expense or damage (including reasonable
attorney's fees) in connection with any claim by any party arising out of the operation of
the Concessions by Lessee, including any alleged tort or contract liability.
SECTION 17.9: COOPERATION IN OPERATION OF CONCESSION.
The parties will cooperate in their booking, scheduling, operation and use of the Excepted
Premises to facilitate efficient operation of the facilities and achieve maximum revenues
through attracting additional conventions and visitors.
43
1160171-v1
I
ARTICLE XVIII
MECHANICS' LIENS
SECTION 18.1: DISCHARGE OF MECHANICS' LIENS. The Lessee shall
not suffer or permit any mechanics' liens to be filed against the title to the Demised
Premises, nor against the Lessee's interest in the Demised Premises, by reason of work,
labor, services or materials supplied or claimed to have been supplied to the Lessee or
anyone having a right to possession of the Demised Premises as a result of an agreement
with or the assent of the Lessee. Nothing in this Lease Agreement shall be construed as
constituting the consent or request of the Lessor, expressed or implied, by inference or
otherwise, to any contractor, subcontractor, laborer or materialman for the performance
of any labor or the furnishing of any materials for any specific improvement, alteration or
repair of the Demised Premises, nor as giving the Lessee the right, power or authority to
contract for or permit the rendering of any services or the furnishing of any materials that
would give rise to the filing of any mechanics' and materialmen's liens against the
Lessor's interests in the Demised Premises. If any mechanics' and materialmen's lien
shall at any time be filed against the Demised Premises, the Lessee shall cause it to be
discharged of record within ten days after the date the Lessee has knowledge of its filing.
If the Lessee shall fail to discharge such lien within that period, then in addition to any
other right or remedy, the Lessor may, but shall not be obligated to, discharge the lien
either by paying the amount claimed to be due or by procuring the discharge of the lien
by deposit in court or bonding, or in the event the Lessor shall be entitled, if it so elects,
to compel the prosecution of any action for the foreclosure of the lien by the lienor and to
pay the amount of the judgment, if any, in favor of the lienor with interest, costs and
allowances with the understanding that all amounts paid by the Lessor shall constitute
additional Rent due and payable under this Lease Agreement and shall be repaid to the
Lessor by the Lessee immediately upon rendition of an invoice or bill by the Lessor.
Notwithstanding anything contained herein to the contrary, the Lessee shall not be
required to pay or discharge any such lien so long as the Lessee shall in good faith
proceed to contest the lien by appropriate proceedings and if the Lessee shall have given
notice in writing to the Lessor of its intention to contest the validity of the lien and shall
furnish and keep in effect a surety bond of a responsible and substantial surety company
reasonably acceptable to Lessor or other security reasonably satisfactory to Lessor in an
amount sufficient to pay one hundred ten percent (110%) of the amount of the contested
lien claim with all interest on it and costs and expenses, including reasonable attorneys'
fees, to be incurred in connection with it.
ARTICLE XIX
COVENANT AGAINST WASTE AND INSPECTION
SECTION 19.1: WASTE. Except as otherwise permitted by this Lease
Agreement, the Lessee covenants not to do or suffer any demolition, waste or damage,
disfigurement or injury to the Demised Premises or any part of it, or permit or suffer any
overloading of its structural members or floors.
44
1160171-vi
SECTION 19.2: INSPECTION OF DEMISED PREMISES. (a) Lessor may
inspect the Demised Premises annually, commencing on the 1st day of March of each
year during the Term and any Renewal Term to determine compliance with the terms and
provisions hereof and the Lessee hereby agrees to fully cooperate with the Lessor during
the inspection and will make all parts of the Demised Premises available to the Lessor.
Moreover, if the Lessor in good faith reasonably believes that the Lessee has not
complied with its obligations hereunder the Lessor shall have the right to inspect the
Demised Premises by giving the Lessee at least ten (10) days written notice specifying
the non-conforming condition and the Lessee covenants and agrees to fully cooperate
with the Lessor and will make all parts of the Demised Premises specified in the
aforesaid notice available to the Lessor for inspection.
(b) If the Lessor shall serve the Lessee with a notice of the occurrence of an
Event of Default hereunder the Lessor shall have the right, upon the expiration of any
applicable grace period, to inspect the Demised Premises in order to ascertain whether or
not the subject event of default has, in fact, been cured and again the Lessee agrees to
fully cooperate with the Lessor and will make all parts of the Demised Premises, which
are the subject of the event of default available to the Lessor.
(c) Notwithstanding anything contained herein to the contrary, Lessor's right
to enter the Demised Premises in accordance with this Section shall be subject to the
rights of any guests and tenants of the Lessee who shall not be disturbed; provided,
however, that nothing contained herein shall limit Lessor's right or ability to enter the
Demised Premises in an emergency in the exercise of its duties as a municipal
corporation, including, without limitation in connection with the due exercise of its police
power and in satisfying its public safety obligations.
SECTION 19.3: INSPECTION OF EXCEPTED PREMISES. Lessee shall
have the same rights to inspect the Excepted Premises as are set out in Section 19.2(a)
and (b) above for the Demised Premises.
SECTION 19.4: EXHIBITION AND INSPECTION OF DEMISED
PREMISES. In the event that Lessee does not exercise the applicable renewal option,
the Lessor is given the right during the last six months of the Term, with reasonable
advance notice to Lessee, to enter the Demised Premises or any part of it, and to exhibit it
in connection with the sale or leasing of the Demised Premises. The Lessor and its
agents and architects may from time to time during usual business hours inspect any
repairs, renewals or other construction on or in the Demised Premises. None of the
Lessor's rights under this Section 19.4 shall be exercised in a manner that will interfere
unreasonably with the Lessee's business, or the business of Sublessees. Notwithstanding
anything contained herein to the contrary, Lessor's right to enter the Demised Premises in
accordance with this Section shall be subject to the rights of any guests and tenants of the
Lessee.
45
1160171-v1
ARTICLE XX
UTILITY CHARGES
SECTION 20.1: LESSEE TO PROVIDE AND PAY FOR UTILITIES.
Except as provided in Section 20.2 below, the Lessee will pay, or cause to be paid, all
proper charges for gas, electricity, light, heat, water and power, for telephone, protective
and other communication services, and for all other public or private utility services,
which shall be used, rendered or supplied upon or in connection with the Demised
Premises or any part of it, at any time during the Term of this Lease Agreement, and the
Lessee will comply with all contracts relating to any services and will do all other things
required for the maintenance and continuance of all services as are necessary for the
proper maintenance and operation of the Demised Premises. Lessor shall charge Lessee
for any such utilities and services metered or billed through Lessor at the same rates paid
by Lessor and its affiliates without markup or up-charge to Lessee. Lessor shall, at
Lessor's expense, cause separate meters for water and electric service used in the
Demised Premises to be installed and maintained. The Lessee will also at its sole
expense.procure any and all necessary permits, licenses or other authorization required
for the lawful and proper installation and maintenance upon the Demised Premises of
wires, pipes, conduits, tubes and other equipment and appliances for use in supplying any
such utilities, services or substitutes to the Demised Premises and the Lessor will
cooperate with and assist the Lessee in such endeavor. In case any charge, cost or
expense for any of the above mentioned utility services or for any of the other above-
mentioned services shall not be paid when due and payable, the Lessor shall have the
right, but shall not be obligated, to pay the same, with the understanding that all amounts
paid by the Lessor shall be repaid to the Lessor by the Lessee promptly on rendition of a
bill by the Lessor.
SECTION 20.2: HOT AND CHILLED WATER. (a) Lessor has constructed
and operates a plant on the Excepted Premises which produces adequate hot and chilled
water (hereinafter referred to as "Hot and Chilled Water") for domestic water
consummation and to heat and cool both the Demised Premises and part of the Excepted
Premises. The Hot and Chilled Water is furnished by the Lessor to the Lessee, pursuant
to estimates of the quantities and specifications supplied by the Lessee to the Lessor, at
and to a specified reception location in the Demised Premises. The temperatures and
pressures of the Hot and Chilled Water and the point of reception and the size of piping
in which the same shall be received shall be as so specified by Lessee and controlled by
the Lessor from time to time.
(b) Lessor shall promptly (i) install the final metering phase and mechanical
control system for the Hot and Chilled Water system serving the Demised Premises and
part of the Excepted Premises; and (ii) replace the Conference Center water chiller.
Lessor shall cause all such construction to be promptly performed with the total cost to be
subject to competitive bids. All such design, engineering, construction, contracting, and
testing shall be subject to the mutual approval of Lessor and Lessee. Lessee shall within
45 days following receipt of written notice of completion pay up to 1/2 of the actual cost of
such renovations, but Lessee's share shall not exceed Three Hundred Fifty Thousand
46
1160171-v1
Dollars ($350,000.00) in the aggregate All other costs and expenses shall be borne by
Lessor.
SECTION 20.3: LESSOR NOT LIABLE FOR FAILURE OF UTILITIES.
The Lessee hereby releases and agrees that the Lessor shall not be liable for any failure of
the telephone, cable, sewer, gas or electric current or any other utility supplied by third
parties, or for any injury or damage to persons or property caused by or resulting from
gasoline, oil, steam, gas, electricity, utility or hurricane, tornado, flood, wind or similar
storms or disturbances, or water, rain, snows or hazardous waste which may leak or flow
from the street, sewer, gas mains or from any part of the Demised Premises or the
Excepted Premises, or leakage of gasoline or gas from pipes, appliances, sewer or
plumbing works therein, or from any other place, or for interference with light or other
incorporeal hereditaments, nor shall Lessee be liable to Lessor for such events, or caused
by operations by or of any public or quasi-public work, and the foregoing shall apply to
the Lessor both in its capacity as a lessor of real property and in its capacity as a
municipal corporation.
ARTICLE XXI
INDEMNIFICATION OF LESSOR
SECTION 21.1: GENERAL INDEMNIFICATION OF LESSOR
WITHOUT LIMITATION OF ANY OTHER INDEMNITY GIVEN
HEREUNDER. The Lessee agrees to indemnify, defend and save harmless the Lessor
against and from any and all claims and damages, other than due to the Lessor's gross
negligence or willful misconduct, by or on behalf of any person, firm or corporation,
arising on or after the Effective Date, arising out of or in any way connected to: (i) the
Lessee's performance or non-performance of its obligations hereunder, (ii) the acts or
omissions of the Lessee, its employees, agents, guests, patrons and invitees and from the
conduct or management of or from any operation, maintenance, renovation,
enhancement, repair or replacement, or thing whatsoever done in or about the Demised
Premises (iii) any condition of the Demised Premises on or after the Effective Date
hereof, or of any vaults, passageways or spaces appurtenant to it under the Lessee's
control (except for adverse conditions known to Lessor and not disclosed in the Estoppel
Statements attached hereto as Exhibits "E" or "F" and except the Excepted Premises), or
arising from any breach or default on the part of the Lessee to be performed, pursuant to
the terms of this Lease Agreement, (v) arising from any act or negligence of the Lessee
or any of its agents, contractors, servants, employees, guests, patrons, invitees or
licensees, or (vi) arising from any accident, injury or damage whatsoever caused to any
Person occurring during the term of this Lease Agreement in or on the Demised
Premises, and (vii) from and against all costs, counsel and legal fees, expenses and
liabilities incurred in any of the aforesaid claims or actions or proceedings brought
thereon. In case any action or proceeding be brought against the Lessor by reason of a
claim (meaning a claim for damages arising, other than due to the Lessor's gross or
wanton negligence or willful misconduct) during the term of this Lease Agreement from
any condition of the Demised Premises or any vaults, passageways or spaces appurtenant
47
1160171-v1
to it under the Lessee's control, or on or after the Effective Date hereof, the Lessee upon
notice from the Lessor shall at its expense resist or defend the action or proceeding by
counsel reasonably satisfactory to the Lessor. If the Lessee be required to defend any
action or proceeding pursuant to this Article to which action or proceeding the Lessor is
made a party, the Lessor shall also be entitled to appear, defend, or otherwise take part in
the matter involved at its election, and at the sole expense of the Lessee (except the
Lessee shall not be obligated to pay counsel fees when an insurance carrier is obligated to
and does defend the Lessor), by counsel of its own choosing, provided this action by the
Lessor does not limit or make void any liability of any insurer of the Lessor or the Lessee
in respect to the claim or matter in question. The foregoing agreements of indemnity are
in addition to and not by way of limitation of any other covenants in this Lease
Agreement to indemnify the Lessor.
SECTION 21.2: LESSOR INDEMNITY. To the maximum extent allowed and
permitted by the Constitution and laws of the State of Arkansas, Lessor, on the same
terms and conditions set out in Section 21.1, indemnifies Lessee from liability and loss or
from breaches by Lessor of any obligations imposed upon Lessor pursuant to this Lease
Agreement except that any reference to Demised Premises with respect to such Lessee
indemnification shall instead refer to the Excepted Premises.
Accordingly, the Lessor agrees to indemnify, defend and save harmless the
Lessee against and from any and all claims and damages, other than due to the Lessee's
gross negligence or willful misconduct, by or on behalf of any person, firm or
corporation, arising on or after the Effective Date, arising out of or in any way connected
to: (i) the Lessor's performance or non-performance of its obligations hereunder, (ii) the
acts or omissions of the Lessor, its employees, agents, guests, patrons and invitees and
from the conduct or management of or from any operation, maintenance, renovation,
enhancement, repair or replacement, or thing whatsoever done in or about the Excepted
Premises (iii) any condition of the Excepted Premises on or after the Effective Date
hereof, or of any vaults, passageways or spaces appurtenant to it under the Lessor's
control (except for adverse conditions known to Lessee in the Demised Premises and not
caused by Lessor), or arising from any breach or default on the part of the Lessor to be
performed, pursuant to the terms of this Lease Agreement, (v) arising from any act or
negligence of the Lessor or any of its agents, contractors, servants, employees, guests,
patrons, invitees or licensees, or (vi) arising from any accident, injury or damage
whatsoever caused to any Person occurring during the term of this Lease Agreement in or
on the Excepted Premises, and (vii) from and against all costs, counsel and legal fees,
expenses and liabilities incurred in any of the aforesaid claims or actions or proceedings
brought thereon. In case any action or proceeding be brought against the Lessee by
reason of a claim (meaning a claim for damages arising, other than due to the Lessee's
gross or wanton negligence or willful misconduct) during the term of this Lease
Agreement from any condition of the Excepted Premises or any vaults, passageways or
spaces appurtenant to it under the Lessor's control, or on or after the Effective Date
hereof, the Lessor upon notice from the Lessee shall at its expense resist or defend the
action or proceeding by counsel reasonably satisfactory to the Lessee. If the Lessor be
required to defend any action or proceeding pursuant to this Article to which action or
48
1160171-v1
proceeding the Lessee is made a party, the Lessee shall also be entitled to appear, defend,
or otherwise take part in the matter involved at its election, and at the sole expense of the
Lessor (except the Lessor shall not be obligated to pay counsel fees when an insurance
carrier is obligated to and does defend the Lessee), by counsel of its own choosing,
provided this action by the Lessee does not limit or make void any liability of any insurer
of the Lessee or the Lessor in respect to the claim or matter in question. The foregoing
agreements of indemnity are in addition to and not by way of limitation of any other
covenants in this Lease Agreement to indemnify the Lessee.
SECTION 21.3: REIMBURSEMENT OF COSTS OF OBTAINING
POSSESSION. The Lessee covenants to pay, and to indemnify the Lessor against, all
costs and charges, including, but not limited to, counsel and legal fees, lawfully and
reasonably incurred in obtaining possession of the Demised Premises and establishing the
Lessor's title free and clear of this Lease Agreement and any Leasehold Permitted
Mortgage upon expiration or earlier termination of this Lease Agreement.
ARTICLE XXII
INTENTIONALLY DELETED
ARTICLE XXIII
PLAZA, STREETS AND SIDEWALKS
SECTION 23.1: PLAZA, STREETS AND SIDEWALKS. The Lessor does
not by this instrument lease to the Lessee any space under, in, upon or above any plaza,
street, alley or sidewalk adjoining or adjacent to the Demised Premises, except as
specifically included in the Demised Premises. It is further understood that upon the
termination of this Lease Agreement in any way, whether by lapse of time or otherwise,
all interests of the Lessee and of all parties claiming under the Lessee in any space (as
described in this Section, however these interests may have been acquired, shall revert to
the Lessor without any compensation being allowed or paid therefor.
ARTICLE XXIV
CONDEMNATION
SECTION 24.1: SEPARATE DETERMINATION OF CONDEMNATION
AWARDS. In the event that all or any part of the Demised Premises or any leasehold or
other interest in the Demised Premises shall be taken or damaged by the exercise by any
governmental authority(including but not limited to the exercise of the power of eminent
domain by the Lessor) of the power of eminent domain, then (whether or not this Lease
Agreement shall terminate by operation of law upon such exercise of the power of
eminent domain) the amount of damages resulting to Lessor and Lessee, respectively, and
to their respective interests in and to the Demised Premises, if applicable, and in, to and
in connection with this Lease Agreement, by reason of the exercise of the power of
eminent domain, shall be separately determined and computed by the court having
49
1160171-v1
jurisdiction and separate awards and judgments with respect to damages to Lessor and
Lessee, respectively, and to each of their respective interests, shall be made and entered.
In the event that a court shall make a single award without separately determining the
respective interests of Lessor and Lessee, and if Lessor, Lessee, and Lessee's Permitted
Mortgagee shall not agree in writing as to their respective portions of an award within 20
days after the date of the final determination by the court of the amount of it, Lessor and
Lessee agree to submit the matter to the court on stipulation for the purpose of a
judgment determinative of their respective shares.
Notwithstanding anything contained herein to the contrary, if the full amount of
any such condemnation proceeds, including, without limitation, Lessor's share, shall,
when added to such amount of the Lessee's share, be sufficient to cause the portion of the
Demised Premises not taken pursuant to such condemnation proceedings to be repaired
and reconstructed for use in accordance with the requirements of Article VII, then the
Lessee shall have the obligation to so repair and reconstruct such remaining portion of the
Demised Premises using such condemnation proceeds (including, without limitation,
Lessor's share) for use in accordance with Article VII. Provided, however, if the
condemnation occurs during the last ten (10) years of the Term or any Renewal Term
hereof, then, and in such event, Lessee may at its option, elect to terminate this Lease
Agreement by delivering thirty(30) days prior written notice to the Lessor within 90 days
following the date of the final determination of the condemnation award, no appeal
having been taken, in which event the Lessor's share of any award shall be retained by the
Lessor and the Lessee's share of any award shall be retained by the Lessee and, upon such
election by the Lessee, this Lease Agreement shall terminate, as if by lapse of time, on
the effective date of such notice. At the time of the execution of this Lease Agreement, no
condemnation proceedings are contemplated by the Lessor in its municipal capacity with
respect to the Demised Premises.
SECTION 24.2: DEPOSIT OF CONDEMNATION AWARD WITH
LESSOR. Unless the effect of a condemnation proceeding shall be to terminate this
Lease Agreement by operation of law or as provided in Section 24.3 below, and except as
may be provided in any Permitted Mortgage to, or agreement with, any Permitted
Mortgagee described in this Lease Agreement, any award made in respect of the Demised
Premises in a condemnation proceeding shall be deposited with the Lessor to be first paid
out for the cost of restoring the Demised Premises and accomplishing the work (to the
extent the work has not been substantially completed) and for other purposes in
accordance with the terms of this Lease Agreement. Unless Lessee elects to exercise any
applicable right to terminate the Lease, Lessee shall make additional deposits with Lessor
(in lieu of deposits with the construction lender), if any are required, all in accordance
with the terms of this Lease Agreement.
SECTION 24.3: EFFECT OF TAKING ON RENT. In the event that all or
substantially all of the Demised Premises shall be taken by the exercise of the power of
eminent domain or sold in lieu thereof by agreement between Lessor, Lessee and those
authorized to exercise the power of eminent domain, all rent, Impositions, Rent Tax and
other sums or sums of money and other charges provided to be paid by Lessee and related
50
1160171-v1
to particular periods of time shall be apportioned and paid to the date of taking and the
Lease Agreement shall terminate as of that date at the option of Lessee. Unless all or
substantially all of the Demised Premises are taken by the exercise of the power of
eminent domain or by agreement or unless this Lease Agreement is terminated by
agreement or by operation of law as a result of the exercise of eminent domain, this Lease
Agreement shall continue in full force and effect. Substantially all of the Demised
Premises shall be deemed to have been taken if and only if the remaining portion of the
Demised Premises are not sufficient to economically justify the continuance of the
operation of the Demised Premises as a convention center hotel franchised pursuant to
Article VII.
In the event all or substantially all of the Excepted Premises is taken by the
exercise of the power of eminent domain, or sold in lieu thereof by agreement, Lessee
shall have the option to continue this Lease Agreement or terminate this Lease
Agreement. Substantially all of the Excepted Premises shall be deemed to have been
taken if and only if the remaining portion of the Excepted Premises are not sufficient to
economically justify the continuance of the operation of the Excepted Premises pursuant
to Article IX.
If this Lease Agreement shall continue in effect under the foregoing provisions,
then after the date of any taking, this Lease Agreement shall continue in full force and
effect without any modification, except that the rent payable by Lessee shall be modified
as follows:
If the taking may reasonably be expected to cause a reduction in the level of the
Lessee's average annual net operating income (that is, Lessee's gross revenues less
operating expenses) from those received during the twelve (12) calendar months
immediately prior to the taking, the Rent shall be reduced in the same proportion that the
anticipated reduction in the Lessee's average annual net operating income, bears to the
Lessee's average annual net operating income during the twelve (12) calendar months
immediately prior to the taking.
SECTION 24.4: RIGHTS OF PERMITTED MORTGAGEE. Lessor and
Lessee shall not settle or compromise the amount or division of any award in any
condemnation proceeding without any Permitted Mortgagee's consent. Any Permitted
Mortgagee of Lessee shall be entitled to appear in any condemnation proceedings and
make claim for the share of any award to which Lessee is entitled by the terms of this
Article. Except as otherwise provided in any Permitted Mortgage to, or agreement with,
any Permitted Mortgagee described in Article VI above, a Permitted Mortgagee shall
only be entitled to that portion of Lessee's interest in the condemnation award after
disbursements of costs; provided, however, the Permitted Mortgagee shall have first
priority, after disbursements of costs, to all condemnation awards applicable to the
Demised Premises or to Lessee's leasehold interest.
SECTION 24.5: TEMPORARY TAKING. In the event that all or any portion
of the Demised Premises shall be taken by the exercise of the right of eminent domain for
51
1160171-v1
governmental use or occupancy for a temporary period, this Lease Agreement shall not
terminate and Lessee shall continue to perform and observe all of its obligations
(including the obligation to pay rent as provided throughout this Lease Agreement) as
though the temporary taking had not occurred except only to the extent that it may be
prevented from so doing by the terms of the order of the authority which made the taking
or by the conditions resulting from the taking, including the loss of its possession of all or
any part of the Demised Premises. In the event the taking of the Demised Premises for
governmental occupancy is for a period entirely within the term of this Lease Agreement,
then Lessee shall be entitled to receive the entire amount of any award made for the
taking, whether paid by way of damages, rent or otherwise. If the period of governmental
occupancy extends beyond the termination of the term of this Lease Agreement, the
amount of the award, after payment to Lessor of the estimated cost of restoration of the
Demised Premises, shall be apportioned between Lessor and Lessee as of the date of the
termination.
Lessee covenants that if the taking for governmental occupancy is for a period
entirely within the term of this Lease Agreement, and if termination of any governmental
occupancy occurs prior to 10 years before the termination of this Lease Agreement,
Lessee at its sole cost and expense will restore the Demised Premises as nearly as may be
reasonably possible to the condition in which it was immediately prior to the taking to the
extent of the proceeds of the condemnation.
ARTICLE XXV
DEFAULT PROVISIONS
SECTION 25.1: EVENTS OF DEFAULT. Each of the following events is
defined as an "Event of Default":
(a) The failure of the Lessee to fully perform and comply with the provisions
of Sections 7.1 and 7.2 within the time periods prescribed.
(b) The failure of the Lessee to pay any installment of the Annual Rent
Amount, any installment of Concession fees and/or any other payments or deposits of
money (including the charges for Hot and Chilled Water) when due and the continuance
of the failure for a period of 30 days after Lessee's receipt of written notice from the
Lessor.
(c) The failure of the Lessee to perform any of the other covenants, conditions
and agreements of this Lease Agreement on the part of the Lessee to be performed, and
the continuance of the failure for a period of 60 days after notice in writing (which notice
shall specify the respects in which the Lessor contends that the Lessee has failed to
perform any of the covenants, conditions and agreements) from the Lessor to the Lessee
shall be an event of default, provided that this 60 day time period shall be reasonably
extended if: (i) within 10 days of receipt of the written notice referred in this subsection,
Lessee contacts Lessor and establishes to Lessor's reasonable satisfaction that for reasons
52
1160171-v1
beyond Lessee's control the covenant, condition or agreement cannot reasonably be
performed within the 60 days of the written notice; (ii) and Lessee is otherwise making
good faith efforts to perform the covenant, condition or agreement; and (iii) the reason
that the covenant, condition and agreement cannot be performed by the Lessee is not the
fact that the Lessee lacks the financial ability to fully perform same; and (iv) the failure to
perform the covenant, condition and agreement by the Lessee within the time period of
the extension will be an Event of Default.
(d) The filing of an application by the Lessee (the term, for this purpose, to
include any approved transferee other than a Sublessee of the Lessee's interest in this
Lease Agreement): (i) for a consent to the appointment of a receiver, trustee or liquidator
of itself or all its assets; (ii) of a voluntary petition in bankruptcy or the filing of a
pleading in any court of record admitting in writing its inability to pay its debts as they
come due; (iii) of a general assignment for the benefit of creditors; (iv) of an answer
admitting the material allegations of, or its consenting to, or defaulting in answering, a
petition filed against it in any bankruptcy proceeding; or
(e) The entry of an order, judgment or decree by any court of competent
jurisdiction, adjudicating the Lessee a bankrupt, or appointing a receiver, trustee or
liquidator of it or of its assets, and this order,judgment or decree continuing unstayed and
in effect for any period of 60 consecutive days, or if this Lease Agreement is taken under
a writ of execution.
*Note: In the event this Lease Agreement is assumed by or assigned to a trustee pursuant
to the provisions of the Bankruptcy Reform Act of 1978, as amended, from time to time,
(referred to as "Bankruptcy Code") (111 USC 1 et seq.), the trustee shall cure any default
under this Lease Agreement and shall provide adequate assurances of future performance
of this Lease Agreement as are required by the Bankruptcy Code (including, but not
limited to, the requirement of Section 365(b)(1)) (referred to as "Adequate Assurances").
If the trustee does not cure such defaults and provide such Adequate Assurances under
the Bankruptcy Code within the applicable time periods provided by the Bankruptcy
Code, then this Lease Agreement shall be deemed rejected automatically and the Lessor
shall have the right immediately to possession of the Demised Premises immediately and
shall be entitled to all remedies provided by the Bankruptcy Code for damages for breach
or termination of this Lease Agreement.
SECTION 25.2: REMEDIES OF LESSOR IN EVENT OF DEFAULT.
Subject to the provisions of Article VI hereof, if an Event of Default as defined in Section
25.1 above and not excused by Force Majeure shall have occurred and remains uncured
beyond any applicable grace period therein prescribed; then and thereafter the Lessor
may at its option, in addition to other remedies provided by law or in equity, pursue any
one or more of the following remedies:
(a) The Lessor may terminate this Lease Agreement and the term created, in
which event the Lessor may repossess the entire Demised Premises, and be entitled to
recover any damages allowed by law.
1160171-v1 53
(b) The Lessor may terminate the Lessee's right of possession and may
repossess the entire Demised Premises by forcible entry and detainer suit or otherwise,
without demand or notice of any kind to the Lessee (except as above expressly provided
for) and without terminating this Lease Agreement, in which event the Lessor may, but
shall be under no obligation so to do, relet all or any part of the Demised Premises for
Rent and upon terms as shall be satisfactory in the judgment reasonably exercised by the
Lessor (including the right to relet the Demised Premises for a term greater or lesser than
that remaining under the stated term of this Lease Agreement and the right to relet the
Demised Premises as a part of a larger area and the right to change the use made of the
Demised Premises). For the purpose of reletting, the Lessor may make any repairs,
changes, alterations or additions in or to the Demised Premises that may be reasonably
necessary or convenient in the Lessor's judgment reasonably exercised; and if the Lessor
shall be unable after a reasonable effort to do so to relet the Demised Premises, or if the
Demised Premises are relet and a sufficient sum shall not be realized from reletting after
paying all of the costs and expenses of repairs, changes, alterations and additions and the
expense of reletting and the collecting of the Rent accruing from it, to satisfy the Rent
above provided to be paid, then the Lessee shall pay to the Lessor as damages a sum
equal to the amount of the Rent reserved in this Lease Agreement for the period or
periods as and when payable pursuant to Article V, or, if the Demised Premises or any
part of it has been relet, the Lessee shall satisfy and pay any deficiency upon demand
from time to time; and the Lessee acknowledges that the Lessor may file suit to recover
any sums falling due under the terms of this Subsection (b) from time to time and that
any suit or recovery of any portion due the Lessee shall be no defense to any subsequent
action brought for any amount not previously reduced to judgment in favor of the Lessor.
(c) In the event of any breach by the Lessee of any of the terms, covenants,
agreements, provisions or conditions in this Lease Agreement, the Lessor shall have the
right to invoke any right and remedy allowed at law or in equity or by statute or
otherwise such as reentry, summary proceedings, and other remedies not provided for in
this Lease Agreement.
(d) Upon the termination of this Lease Agreement and the term created, or
upon the termination of the Lessee's right of possession, whether by lapse of time or at
the option of the Lessor, the Lessee will at once surrender possession of the Demised
Premises to the Lessor and remove all its personal property from it; and if possession be
not immediately surrendered, the Lessor may reenter the Demised Premises and repossess
itself of it as of its former estate and remove all Persons and their personal property,
using force as may be necessary without being deemed guilty of any manner of trespass
or forcible entry or detainer.
SECTION 25.3: WAIVERS AND SURRENDERS TO BE IN WRITING.
The receipt of any sum due hereunder by the Lessee or the Lessor, with knowledge of
any breach of this Lease Agreement by the other or of any default on the part of the other
in the observance or performance of any of the conditions, agreements or covenants of
this Lease Agreement, shall not be deemed to be a waiver of any provision of this Lease
54
1160171-v1
Agreement. No failure on the part of a party to enforce any covenant or provision
contained in this Lease Agreement, or any waiver of any right under it, unless in writing,
shall discharge or invalidate such covenant or provision or affect the right of a party to
enforce it in the event of any subsequent breach or default. No covenant or condition of
this Lease Agreement shall be deemed to have been waived unless the waiver is in
writing, signed by a party or its agent duly authorized in writing. Consent of a party to
any act or matter must be in writing and shall apply only with respect to the particular act
or matter to which the consent is given and shall not relieve the other from the obligation,
wherever required under this Lease Agreement, to obtain the consent to any other act or
matter. The receipt by the Lessor of any Rent or any other sum of money or any other
consideration paid by the Lessee after the termination, in any manner, of the term
demised, shall not reinstate, continue or extend the term demised, unless agreed to in
writing and signed by the Lessor and Lessee.
SECTION 25.4: LESSEE'S REMEDIES IN THE EVENT OF LESSOR'S
DEFAULT. The failure of the Lessor to perform any of the covenants, conditions and
agreements of this Lease Agreement on the part of the Lessor to be performed not
excused by Force Majeure, and the continuance of the failure for a period of 60 days after
notice in writing (which notice shall specify the respects in which the Lessee contends
that the Lessor has failed to perform any of the covenants, conditions and agreements)
from the Lessee to the Lessor shall be an Event of Default, provided that this 60 day time
period shall be reasonably extended if: (i) within 10 days of receipt of the written notice
referred in this subsection, Lessor contacts Lessee and establishes to Lessee's satisfaction
that for reasons beyond Lessor's control the covenant, condition or agreement cannot
reasonably be performed within the 60 days of the written notice; (ii) and Lessor is
otherwise making good faith efforts to perform the covenant, condition or agreement; and
(iii) the reason that the covenant, condition and agreement cannot be performed by the
Lessor is not the fact that the Lessor lacks the financial ability to fully perform same; and
(iv) the failure to perform the covenant, condition and agreement by the Lessor within the
time period of the extension will be an Event of Default. Upon occurrence of an Event of
Default as defined in this Section 25.4, which remains uncured upon the expiration of any
applicable grace period, then and in that event the Lessee may, at its option, exercise any
one of the following remedies: (i) terminate this Lease Agreement, or (ii) pursue and
invoke any right and remedy allowed at law or in equity or by statute or otherwise.
ARTICLE XXVI
INTENTIONALLY DELETED
ARTICLE XXVII
INVALIDITY OF PARTICULAR PROVISIONS
SECTION 27.1: INVALIDITY OF PROVISIONS. If any provision of this
Lease Agreement or the application of it to any Person or circumstances shall to any
extent be invalid or unenforceable, the remainder of this Lease Agreement, or the
55
1160171-v1
application of such provision to Persons or circumstances other than those as to which it
is invalid or unenforceable, shall not be affected, and each provision of this Lease
Agreement shall be valid and be enforced to the fullest extent permitted by law.
ARTICLE XXVIII
QUIET ENJOYMENT
SECTION 28.1: OUIET ENJOYMENT, The Lessor acknowledges that the
Lessee, upon paying the Rent and all Impositions and other charges, and performing all
the covenants and conditions of this Lease Agreement, shall (subject to the matters and
things of record and the Lessor's rights specified in this Lease Agreement) lawfully and
quietly occupy the Demised Premises during the term of this Lease Agreement without
hindrance or molestation by Lessor or any persons claiming under the Lessor.
ARTICLE XXIX
LESSOR'S TITLE AND LIEN
SECTION 29.1: TITLE PARAMOUNT. The Lessor shall have title to the
Demised Premises and, upon termination of this Lease Agreement, the remainder or
residual interest in the Demised Premises paramount to all others, subject only to the
rights of the Permitted Mortgagee.
SECTION 29.2: LESSEE NOT TO ENCUMBER LESSOR'S INTEREST.
The Lessee shall have no right or power to and shall not in any way encumber the title of
the Lessor in and to the Demised Premises or the title of the Lessor's remainder or
residual interest in the Demised Premises. The fee simple estate of the Lessor in the
Demised Premises and the interest of the Lessor in the Demised Premises shall not be in
any way subject to any claim by way of lien or otherwise, whether claimed by operation
of law or by virtue of any express or implied lease or contract or other instrument made
by the Lessee and any claim to the lien or otherwise upon the Demised Premises arising
from any act or omission of the Lessee shall accrue only against the leasehold estate of
the Lessee in the Demised Premises and shall in all respects be subject to the paramount
rights of the Lessor in the Demised Premises and the Lessor's remainder or residual
interest in the Demised Premises.
ARTICLE XXX
PLATS
SECTION 30.1: PLATS. If a party in the reasonable exercise of its judgment
deems it necessary or desirable from time to time to have recorded a subdivision or
resubdivision plat or plats relating to some or all of the Demised Premises (and which
may include other land) the Lessee or Lessor and any Permitted Mortgagee of the Lessee
when requested to do so by the Lessor or Lessee shall join in the signing of any such plat
56
1160171-v1
provided the same does not materially impair the rights of the Lessee, or any Permitted
Mortgagee of the Lessee, the plat and recordation thereof to be at the requesting parties'
expense.
ARTICLE XXXI
LIMITATION OF LIABILITY
SECTION 31.1: LIABILITY AFTER OUSTER OF LESSEE. In no case
shall the Lessor be liable under any express or implied covenant of this Lease Agreement
for any damages whatsoever for the Lessee's ouster by a third party except that loss, if
any, provided for by the next succeeding sentence. In the event the Lessee shall be
evicted from possession of and/or be prohibited from performing the Renovation and
Enhancement Work (in the ordinary course of construction) upon the Demised Premises
by reason of any matter not of record, the Lessee shall not be required to pay any Rent or
perform its other covenants under this Lease Agreement while it is so deprived of
possession of the Demised Premises. The Lessor shall incur no liability by the ouster
beyond the loss of Rent while or because the Lessee is so deprived of possession of the
Demised Premises. If the Lessee has been so deprived of possession by reason of any
such defect in title not of record for a period in excess of 365 days then Lessee may, in
addition and at its option, terminate this Lease Agreement.
ARTICLE XXXII
ESTOPPEL CERTIFICATES
SECTION 32.1: ESTOPPEL CERTIFICATES. The Lessor and the Lessee
each agree at any time and from time to time, so long as this Lease Agreement shall
remain in effect, upon not less than ten days prior written request by the other party, to
execute, acknowledge and deliver to the other party a statement in writing, addressed to
such Person or Persons that the requesting party request, certifying that this Lease
Agreement is unmodified and in full force and effect or if modified, stating the
modifications and describing the instrument so modifying this Lease Agreement, and the
dates to which the Rent and other charges have been paid in advance, if any, and stating
whether any default under the terms of this Lease Agreement is known by, or any notice
of default has been served by, the party giving the certificate, it being intended that any
statement delivered pursuant to this Article may be relied upon by any prospective
purchaser of the Lessor's fee simple interest in the Demised Premises or of the Lessor's
remainder interest in the Demised Premises or may be relied upon by any Permitted
Mortgagee or assignee of any Permitted Mortgage.
57
1160171-v1
ARTICLE XXXIII
REMEDIES CUMULATIVE
SECTION 33.1: REMEDIES CUMULATIVE. No remedy conferred upon or
reserved to the Lessor or Lessee shall be considered exclusive of any other remedy, but
shall be cumulative and shall be in addition to every other remedy given under this Lease
Agreement or existing at law or in equity or by statute; and every power and remedy
given by this Lease Agreement to the Lessor or Lessee may be exercised from time to
time and as often as occasion may arise or as may be deemed expedient by the Lessor or
Lessee. No delay or omission of Lessor or Lessee to exercise any right or power arising
from any default shall impair any right or power, nor shall it be construed to be a waiver
of any default or any acquiescence in it.
SECTION 33.2: WAIVER OF REMEDIES NOT TO BE INFERRED. No
waiver of any breach of any of the covenants or conditions of this Lease Agreement shall
be construed to be a waiver of any other breach or to be a waiver of, acquiescence in, or
consent to any further or succeeding breach of the same or similar covenant or condition.
SECTION 33.3: RIGHT TO TERMINATE NOT WAIVED. Neither the
rights given to receive, sue for or distrain from any Rent,moneys or other payments, or to
enforce any of the terms of this Lease Agreement, or to prevent the breach or
nonobservance of it, nor the exercise of any such right or of any other right or remedy
shall in any way impair or toll the right or power of the parties to declare ended the term
granted and to terminate this Lease Agreement because of any Event of Default.
ARTICLE XXXIV
SURRENDER AND HOLDING OVER
SECTION 34.1: SURRENDER AT END OF TERM. On the last day of the
last Lease Year of the original term or any renewal term, or on the earlier termination of
the term, the Lessee shall peaceably and quietly leave, surrender and deliver the entire
Demised Premises to the Lessor in good, substantial and sufficient repair, order and
condition, subject to among other things, casualty losses, acts of God and condemnations,
reasonable use, wear and tear excepted, free and clear of any and all mortgages, liens,
encumbrances and claims, except those permitted herein. At the time of the surrender the
Lessee shall also surrender any and all tenant security deposits and rent advances of
sublessees made pursuant to Article XXXV; provided, however, that Lessee shall be
entitled to any and all revenues respecting the Demised Premises accruing prior to the
date of termination of this Lease Agreement, any deposits made by Lessee with respect to
any utility or other services provided to the Demised Premises and any deposits made by
Lessee with respect to any leased furniture, fixtures, intellectual property and other
personal property located at or used in connection with the Demised Premises; Lessee
hereby covenants and agrees to reasonably cooperate, and to cause any other tenant or
occupant of the Lessee after the term hereof to cooperate with Lessor in causing such
sums promptly to be turned over to Lessor. If the Demised Premises are not so
58
1160171-v1
surrendered, the Lessee shall repay the Lessor for all expenses of repossession which the
Lessor shall incur by reason of it, and in addition the Lessee shall indemnify, defend and
hold harmless the Lessor from and against all claims made by any succeeding Lessee
against the Lessor, founded upon delay occasioned by the failure of the Lessee to
surrender the Demised Premises.
SECTION 34.2: RIGHTS UPON HOLDING OVER. At the termination of
this Lease Agreement by lapse of time or otherwise, the Lessee shall yield up immediate
possession of the Demised Premises to the Lessor and, failing so to do, agrees, at the
option of the Lessor, to pay to the Lessor for the whole time such possession is withheld a
sum per day equal to two hundred percent times 1/365th of the aggregate of the Rent paid
or payable to Lessor for the current Lease Agreement Year as set forth in Article V.
The provisions of this Article shall not be held to be a waiver by the Lessor of any
right of entry or reentry as set forth in this Lease Agreement, nor shall the receipt of a
sum, or any other act in apparent affirmance of the tenancy, operate as a waiver of the
right to terminate this Lease Agreement and the term granted for the period still
unexpired for any breach of the Lessee under this Lease Agreement.
ARTICLE XXXV
SUBLEASES
SECTION 35.1: LIMITATIONS ON SUBLEASES. All Subleases entered
into demising all or any part of the Demised Premises shall be expressly subject and
subordinate to this Lease Agreement and shall contain covenants on the part of the
Sublessee that (a) neither the termination of this Lease Agreement nor the institution of
any suit, action or proceeding (other than that of eminent domain) by Lessor to recover
possession of the Demised Premises or to realize possession of Lessee's leasehold estate
shall, by operation of law or otherwise, result in the cancellation or termination of the
Sublease, or of the obligations of the Sublessee, and (b) if Lessor terminates this Lease
Agreement, subject to the rights of any Permitted Mortgagee, any prior assignment of
Lessee's interest in the Sublease or the rents due under the Sublease shall automatically
terminate and Lessor shall be sublessor under the Sublease and the Sublessee will be
deemed to have attorned to Lessor for the balance of the term of the Sublease. If any
Sublessee is not in default of its Sublease, Lessor shall not have the right to disturb its
possession or terminate the Sublease other than by action in eminent domain. If
requested to do so by Lessee or any Sublessee, Lessor will deliver a written certificate
reciting the terms contained in the last sentence.
No Sublease entered into by Lessee demising any part of the Demised Premises
shall permit or require the payment of rent in advance for a period longer than three
months or the application of any security deposit in payment of rent in advance, nor shall
any Sublease (including all agreements made in connection therewith) contain any
provision permitting the Sublessee to set off against the rent due under the Lease
59
1160171-v1
Agreement any claims against Lessee. Lessee agrees not to accept or receipt for any
advance payment of rent which is not permitted as provided.
Lessor acknowledges that neither the termination of this Lease Agreement nor the
institution of any suit, action or proceeding (other than that of eminent domain) by Lessor
to recover possession of the Demised Premises or to realize possession of Lessee's
leasehold estate shall, by operation of law or otherwise, result in the cancellation or
termination of the Sublease, or of the obligations of the Sublessee. Upon Lessor's
succeeding to the interest of Lessee under any Sublease, unless Lessor shall have actually
received from Lessee any security deposit or advance rental of a Sublessee, Lessor shall
not be liable for the refund or application of any such security deposit or advance rental.
SECTION 35.2: SUBLEASE DATA. All Subleases shall contain a covenant on
the part of the Sublessee to the effect that after Lessee shall have been notified of an
Event of Default under this Lease Agreement and provided the Sublessee is given notice
of the default, the Sublease shall not be terminated or canceled (except on account of
Sublessee's default) without the written consent of Lessor, and that the Sublease shall not
be surrendered, modified or amended so as to reduce, directly or indirectly, either the
term of the Sublease or the rent payable without the written consent of Lessor. No
Sublease shall be made for a term extending beyond the last day of the term of this Lease
Agreement or contain terms or concessions inconsistent with prevailing market terms.
SECTION 35.3: ASSIGNMENT OF LEASE AGREEMENTS TO LESSOR
FOR SECURITY. Subject to the rights of any Permitted Mortgagee described herein,
upon and Event of Default by Lessee pursuant to this Lease Agreement, Lessee assigns to
the Lessor all Subleases and subtenancies and/or license and concession agreements to be
made on the Demised Premises, as well as all rents or other sums of money which may
become due and payable to the Lessee, and all security at any time deposited for the
payment of rent and the performance of any other terms of Subleases, subtenancies
and/or license and concession agreements, but the effective date of assignment and of
Lessor's rights thereunder shall be the date of the happening of an Event of Default under
the provisions of this Lease Agreement. From and after any Event of Default and until it
is cured, any Subleases or subtenancies and license and concession agreements may not
be canceled or modified without the written consent of the Lessor, and any cancellation
or modification, whether by the Lessee or Permitted Mortgagee, shall be of no force or
effect. Upon the curing of any Event of Default, the assignment shall no longer be
effective unless and until the happening of another Event of Default. Notwithstanding
anything to the contrary contained in this Section the assignment by Lessee to Lessor
shall be junior to any similar assignments of Subleases and other agreements and rentals
or other monies to any Permitted Mortgagee of Lessee.
No collection or attempted collection of the rent by the Lessor from any assignee,
subtenant or other occupant shall be deemed a waiver of any of the provisions of this
Article XXXV including, without limitation, any applicable covenant against assignment,
mortgage or hypothecation of this Lease Agreement, or a release of Lessee from the
further performance of its obligations under this Lease Agreement. Lessor is authorized
60
1160171-v1
and directed, after first deducting any and all costs and expenses of collection, to apply
all rents that it may collect under the assignment towards the maintenance and operation
of the Demised Premises, the performance of Lessee's covenants, and the payment to
Lessor of any and all sums that may be due under any provisions. In the event that an
assignment becomes effective and operative as above provided, Lessee authorizes Lessor,
in the name of Lessee, or otherwise as Lessor may elect, subject to the rights of any
Permitted Mortgagee, to take all necessary steps and legal proceedings (whether by
nonjudicial proceedings, ejectment or other legal or equitable suit or proceedings) to
collect the rent and enforce the performance of the terms, covenants and conditions of the
Subleases and subtenancies and/or license and concession agreements, or to restrain their
breach, or in the event of a breach, to secure the removal of any Sublessees, subtenants,
licensees or concessionaires from the Demised Premises and/or all of any part of it; and
for this purpose Lessee consents to the use of its name by Lessor.
ARTICLE XXXVI
FINANCIAL REPORT
SECTION 36.1: FINANCIAL REPORT. The Lessee or Lessee's Manager
shall prepare and maintain statements of gross income relating to the operation of all of
the Demised Premises certified as correct by its chief financial officer and prepared in
accord with generally accepted accounting procedures customarily used by Lessee. At all
reasonable times during the term hereof, subject to the consent of the franchisor, Lessee
shall permit the Lessor and/or Lessor's agents access to and the ability to inspect the
statements of gross income which it is required to prepare and maintain pursuant to the
terms hereof; provided, however, Lessor and Lessor's agents shall maintain the
confidentiality of all such financial reports and statements, except where disclosure is
required by law (such disclosure to be limited to only such portions of such reports or
statements required to be disclosed by law) and Lessee shall not be required to furnish
any information in violation of the franchisor's requirements or restrictions or which may
otherwise be exempt from public disclosure under applicable laws.
ARTICLE XXXVII
MODIFICATION
SECTION 37.1: MODIFICATION. None of the covenants, terms or
conditions of this Lease Agreement to be kept and performed by either party to this Lease
Agreement shall in any manner be waived, modified, changed or abandoned except by a
written instrument duly signed, acknowledged and delivered by both Lessor and Lessee.
61 >
1160171-v1
ARTICLE XXXVIII
CONVEYANCE BY LESSEE TO LESSOR
SECTION 38.1: CONVEYANCE BY LESSEE TO LESSOR. Effective upon
the termination of this Lease Agreement, whether by passage of time or otherwise, the
Lessee, in consideration of the granting of this Lease Agreement by the Lessor to the
Lessee, grants and conveys unto the Lessor and Lessor's legal representatives and assigns
forever the Demised Premises, this conveyance to be free and clear of all liens and
encumbrances other than applicable building and zoning ordinances, easements now of
record, and the lien of any real estate taxes assessed but not yet due and payable.
ARTICLE XXXIX
APPLICABLE LAW
SECTION 39.1: LAW. This Lease Agreement shall be construed and enforced
in accordance with the laws of the State of Arkansas.
ARTICLE XL
NOTICES
° SECTION 40.1: MANNER OF MAILING NOTICES. In every case where
under any of the provisions of this Lease Agreement or otherwise it shall or may become
necessary or desirable to make or give any declaration, demand or notice of any kind to
the Lessor or the Lessee, it shall be sufficient if a copy of any declaration, demand or
notice is sent by United States certified or registered mail, postage prepaid, return receipt
requested, or, nationally recognized overnight courier service or fax followed by ordinary
mail confirmation copy addressed: If to Lessor, at:
City of Little Rock
City Hall
500 West Markham
Little Rock, AR 72201
Attention: Mayor
62
1160171-v1
with a copy to:
City Attorney
City of Little Rock
300 City Hall
500 West Markham
Little Rock, AR 72201
and if to City Advertising and Promotion Commission of Little Rock, Arkansas, at:
Little Rock Advertising and Promotion Commission
7 Statehouse Plaza
Little Rock,Arkansas 72201
Attention: Executive Director
with a copy to:
Harry Hamlin, Esq.
Mitchell, Williams, Selig, Gates & Woodyard, PLLC
425 W. Capitol Avenue, Suite 1800
Little Rock, AR 72201
and if to Lessee, at:
FWH II Little Rock, LLC
do Fairwood Capital, LLC
850 Ridge Lake Blvd., Suite 220
Memphis, TN 38120
Attention: Robert M. Solmson
with a copy to:
Fairwood Investors, II, LLC
do Fairwood Capital, LLC
850 Ridge Lake Blvd., Suite 220
Memphis, TN 38120
Attention: Robert M. Solmson
with copies to:
Lee Harkavy, Esq.
Wyatt, Tarrant & Combs, LLP
1715 Aaron Brenner Drive, Suite 800
Memphis, TN 38120
63
1160171-v1
{
John William Spivey, III, Esq.
Wright, Lindsey&Jennings LLP
200 West Capitol Avenue, Suite 2300
Little Rock, AR 72201
Fairwood Capital, LLC
850 Ridge Lake Blvd., Suite 220
Memphis, TN 38120
Attention: Robert M. Solmson
Fairwood Capital, LLC
850 Ridge Lake Blvd., Suite 220
Memphis, TN 38120
Attention: Tom Defreece
Lessor and Lessee agree that any declaration, demand or notice mailed to the
Lessor or Lessee as aforesaid shall be deemed to have been delivered on the date of any
receipt given which shows delivery has occurred. Each party from time to time may
change its address for purposes of receiving declarations or notices by giving notice of
the changed address, to become effective ten days following the giving of notice.
SECTION 40.2: NOTICE TO PERMITTED MORTGAGEES. All notices,
demands or requests which may be required to be given by the Lessor or the Lessee to
any Permitted Mortgagee shall be sent as set out in Section 40.1. Copies of all notices
shall simultaneously be sent to the other of the Lessor or the Lessee, as the case may be.
SECTION 40.3: SUFFICIENCY OF SERVICE. Service of any demand or
notice as in this Article provided shall be sufficient for all purposes.
ARTICLE XLI
MISCELLANEOUS PROVISIONS
SECTION 41.1: CAPTIONS. The captions of this Lease Agreement and the
index preceding it are for convenience and reference only and in no way define, limit or
describe the scope or intent of this Lease Agreement, nor in any way affect this Lease
Agreement.
SECTION 41.2: CONDITIONS AND COVENANTS. All the provisions of
this Lease Agreement shall be deemed and construed to be "conditions" as well as
"covenants," as though the words specifically expressing or importing covenants and
conditions were used in each separate provision.
SECTION 41.3: ENTIRE AGREEMENT., There are no oral or other
agreements contrary to the subject matter of this Lease Agreement, and this Lease
Agreement contains the entire agreement between the parties and shall not be modified in
64
1160171-v1
any manner except by an instrument in writing executed by the parties or their respective
successors or assigns in interest.
SECTION 41.4: TIME OF ESSENCE AS TO COVENANTS OF LEASE
AGREEMENT. Time is of the essence as to the covenants in this Lease Agreement.
SECTION 41.5: INDEMNIFICATIONS SURVIVE. The indemnifications
herein contained shall survive and be and remain in full force and effect, notwithstanding
any assignment hereof and the termination of this Lease Agreement, whether by the
passage of time or otherwise.
SECTION 41.6: NO THIRD PARTY BENEFICIARIES. Nothing expressed
or implied in this Agreement is intended, or shall be construed, to confer upon or give
any person, firm or corporation, other than the parties hereto, their successors and
assigns, any benefits, rights or remedies under or by reason of this Agreement.
SECTION 41.7: SEVERABILITY. Should any provision of this Agreement be
declared to be invalid by any court of competent jurisdiction, such provision shall be
severed from and shall not affect the validity of the remaining provisions of this
Agreement.
SECTION 41.8: CONSTRUCTION. Each Party and counsel for each party
have reviewed this Agreement and, accordingly, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement.
ARTICLE XLII
SHORT FORM LEASE AGREEMENT
SECTION 42.1: SHORT FORM LEASE AGREEMENT. This Lease
Agreement shall not be recorded, but the parties agree, at the request of either of them, to
execute and deliver a Memorandum of Lease Agreement for recording, containing the
names of the parties, the legal description of the Demised Premises, the term of the Lease
Agreement, the covenant set forth in Section 43.3, the Right of First Refusal set forth in
Section 43.4, and any other pertinent provisions for which notice should be given to third
parties. The Lessee agrees to bear the cost of recording the Short Form Lease
Agreement.
1160171-v1 65
ARTICLE XLIII
COVENANTS TO BIND AND BENEFIT
RESPECTIVE PARTIES AND TO RUN WITH THE
DEMISED PREMISES
SECTION 43.1: COVENANTS TO RUN WITH THE DEMISED
PREMISES. All covenants, agreements conditions and undertakings in this Lease
Agreement shall extend and inure to the benefit of and be binding upon the successors
and assigns of each of the parties, the same as if they were in every case named and
expressed, and they shall be construed as covenants running with the Demised Premises.
Wherever in this Lease Agreement reference is made to any of the parties, it shall be
held to include and apply to, wherever applicable, also the officers, directors, successors
and assigns of each party, the same as if in each and every case so expressed.
SECTION 43.2: SIGNAGE AND BANNERS. Lessee (and, subject to Lessee's
prior written approval, Lessee's sub-lessees) shall have the right during the Term and any
Renewal Terms of this Lease Agreement to erect such signage and banners as may be
required by the franchisor of the Approved Hotel on the interior and exterior of the
Demised Premises or the Excepted Premises, provided such signage and banners comply
with all applicable laws, ordinances and regulations. Lessor agrees that it will act in good
faith and use its reasonable best efforts to assist Lessee in obtaining any required
approvals or authorizations with respect to any signage or banners required at the
Approved Hotel in order to comply with all applicable laws, ordinances and regulations.
SECTION 43.3: PROPERTY ALONG RIVER BANK. The City owns certain
real property as described on attached Exhibit "G" which is located immediately North of
the Demised Premises bounded by the Arkansas River. The City agrees that no buildings
shall be constructed on the real property lying North of the Demised Premises and South
of the Arkansas River between the Broadway Bridge on the West and the Main Street
Bridge on the East without the Lessee's prior written consent, which consent shall not be
unreasonably withheld, and it is agreed that this shall be a covenant running with the
Demised Premises.
SECTION 43.4: PARKING LOT. The Lessor (or its designee the Little Rock
Advertising & Promotion Commission ["LRAPC"]) also owns a certain parking lot
defined as the Northeast Quarter of Block 2, City of Little Rock and more particularly
described on attached Exhibit "H" (the "Parking Lot Parcel"). Provided that there is no
uncured default or circumstance which with the passage of time would lead to a default
under this Lease Agreement, Lessor hereby grants to Lessee the right of first refusal (the
"Right of First Refusal") to acquire and/or lease the Parking Lot Parcel, but only in the
event that (i) Lessor (or the LRAPC) receives a bona fide offer (the "Offer") during the
term (including any renewal periods) of the Lease Agreement to sell or lease the Parking
Lot Parcel for the purpose of(a) development of a hotel, or (b) development of a parking
structure or parking lot, or portion thereof, for use in conjunction with a hotel, and (ii) the
Lessor desires to accept such Offer. In the event of a mixed-use development that
includes a hotel or parking structure, this Right of First Refusal shall extend only to that
66
1160171-v1
portion of the property which is proposed to be developed as a hotel or a parking
structure for use in conjunction with a hotel or as excess parking capacity in a parking
structure beyond such parking as required and dedicated to the mixed-use development,
provided, however, in the event such mixed use development is proposed, Lessee may
elect to participate in the development of any such parking structure as an owner or lessee
of parking spaces in lieu of exercising the Right of First Refusal. Notwithstanding the
foregoing, in any event that any of the Parking Lot Parcel is intended.to be used for the
purpose of developing any parking lot or parking structure (whether such triggers the
Right of First Refusal or not), Lessor shall inform Lessee promptly of such intent and
allow Lessee the opportunity to discuss with Lessor or its assigns Lessee's potential
involvement in such parking lot or parking structure. Within thirty (30) days after
receiving any Offer, Lessor shall deliver to Lessee written notice of such Offer,
accompanied by a copy of the Offer. Lessee shall have thirty (30) days after receipt of
such written notice from Lessor to elect to exercise its Right of First Refusal, and if
Lessee exercises such Right of First Refusal, a written sales contract or lease shall be
promptly entered into between Lessor and Lessee on materially identical terms and
conditions as contained in the Offer. Closing of such transaction shall be in accordance
with the provisions of such sales contract or lease on materially identical terms and
conditions as contained in the Offer, provided however that in any event such closing will
occur no sooner than sixty (60) days following Lessee's exercise of the Right of First
Refusal, unless the Lessor and Lessee otherwise mutually agree.
In the event that Lessee does exercise this Right of First Refusal and Lessee plans
to develop parking on the site, then Lessee shall offer to LRCVB (but not to any of
LRCVB's assigns or designees, without Lessee's prior written consent, such consent not
to be unreasonably withheld) up to ten (10) reserved parking spaces, on a complimentary
basis, during the Term of this Lease Agreement in any such parking facility owned and/or
operated on the site by Lessee or its designated representative.
ARTICLE XLIV
GENERAL PROVISIONS
SECTION 44.1: CONFLICT OF INTEREST. No member, official, or
employee of the Lessor shall have any personal interest, direct or indirect, in this Lease
Agreement, nor shall any member, official, or employee participate in any decision
relating to this Lease Agreement which affects his or her personal interests or the
interests of any other entity or Person in which he or she is, directly, or indirectly,
interested. No member, official, or employee of the Lessor shall be personally liable to
the Lessee, its successors and assigns, or anyone claiming by, through or under the
Lessee or any successor in interest to the Demised Premises, in the event of any default
or breach by the Lessor or for any amount which may become due to the Lessee, its
successors and assigns, or any successor in interest to the Demised Premises, or on any
obligation under the terms of this Lease Agreement.
67
1160171-v1
SECTION 44.2: BROKERAGE. The Lessee and the Lessor each represent and
warrant to the other that neither has dealt with any broker or fmder in connection with the
transactions contemplated and each agrees to indemnify, defend and hold the other
harmless of and from any and all manner of claims, including, but not limited to,
reasonable attorneys' fees and expenses, incurred by the other party and arising out of any
claim by any broker or finder if it is ultimately determined that either party has dealt in
contravention of its representation and warranty.
SECTION 44.3: ASSIGNABILITY AND BINDING EFFECTS. Subject to
all provisions respecting the rights of assignment of Subleasing, this Lease Agreement
shall be binding upon and inure to the benefit of the respective successors and assigns of
the parties hereto.
SECTION 44.4: DUPLICATE ORIGINALS/COUNTERPARTS. This Lease
Agreement may be executed in any number of copies, each of which shall constitute an
original counterpart of this Lease Agreement. The warranties, representations,
agreements and undertakings shall not be deemed to have been made for the benefit of
any Person or entity, other than the Lessor or Lessee.
SECTION 44.5: EOUAL EMPLOYMENT OPPORTUNITIES, The Lessee
agrees that during the term or terms hereof, it will not discriminate against any employee
or applicant for employment because of race, religion, creed, color or national origin and
will take affirmative steps to assure that applicants are employed and that employees are
treated during employment without regard to race, religion, creed, color or national
origin.
SECTION 44.6: DECLARATION OF TERMINATION. With respect to
Lessor's rights to obtain possession of the Demised Premises or to revest title in itself
with respect to the leasehold estate of the Lessee in the Demised Premises the Lessor
shall have the right to institute such actions or proceedings as it may deem desirable to
effectuate its rights including, without limitation, the right to execute and record or file
with the Recorder of Deeds of Pulaski County, Arkansas, a written declaration of the
termination of all rights and title of Lessee in the Demised Premises and the revesting of
any title in the Lessor as specifically provided in this Lease Agreement.
SECTION 44.7: AUTHORITY.
(a) The Lessor represents to the Lessee as follows:
(1) That Lessor has, and has exercised, the required corporate and
municipal power and authority and has complied with all applicable Legal Requirements
necessary to adopt, execute and deliver this Lease Agreement and perform its obligations;
(2) That this Lease Agreement has been duly executed and delivered
by Lessor and constitutes a valid and binding obligation of the Lessor enforceable in
accordance with its terms, conditions, and provisions; and
68
1160171-v1
f?_
(b) Lessor specifically represents that the execution and delivery of this Lease
Agreement has been duly authorized and is in accordance with and pursuant to all
applicable laws and ordinances (including without limitation those of the Lessor) and the
Constitution of the State of Arkansas and is effective to vest in the Lessee the rights,
titles, interests and ownership provided for and due Lessor under the terms, conditions
and provisions of this Lease Agreement.
(c) The Lessee represents to the Lessor as follows:
(1) That Lessee has, and has exercised, the required limited liability
company power and authority and has complied with all applicable Legal Requirements
necessary to adopt, execute and deliver this Lease Agreement and perform its obligations;
and,
(2) That this Lease Agreement has been duly executed and delivered
by Lessee and constitutes a valid and binding obligation of the Lessee enforceable in
accordance with its terms, conditions, and provisions.
(d) Lessor does hereby reaffirm its nomination, appointment and delegation to
the Little Rock Advertising and Promotion Commission and to its Executive Director the
responsibilities and duty to act on behalf of the Lessor in all matters involving the
obligations of the Lessor hereunder, including but not limited to, performing each and
every one of the Lessor's obligations hereunder and exercising each and every option and
enforceable right that the Lessor has or is granted herein and enforcing same and in
furtherance of this delegation, the Lessor does hereby duly constitute, appoint and
empower the Little Rock Advertising and Promotion Commission to act for and on behalf
of the City of Little Rock, Lessor hereunder.
SIGNATURES ON FOLLOWING PAGE
69
1160171-v1
!..
In witness, the Lessor has caused this Lease Agreement to be executed in its name
and on its behalf by the Mayor and attested to by the City Clerk of the City of Little
Rock, Pulaski County, Arkansas, and the Lessee has signed as of the date and year first
above written.
LESSOR:
CITY OF LITTLE ROCK, • •NSAS
BY: ///de
TITLE: MAYOR
•�EI
I
„\,.‘
•
auttunrrrrru
'.,
IrfIIUt11t11L
[Signature page of the City of Little Rock]
70
Executed for certain purposes as agent:
LITTLE ROCK ADVERTISING AND
PROMOTI COMMISSION
`:
BY C1. Kr,,. ..__,-+r�
Warren Sim on,\ hlinnan
ATTEST:
2/L-1E b41---
E
[Signature page of Little Rock Advertising and Promotion Commission]
71
F
LESSEE:
FWH II LITTLE ROCK, LLC, a Delaware
limited liability company:
BY: Fairwood Hospitality Investors II,
L.L.C., its Member
BY: Fairwood Investors II, LLC,
its Manager
By:
Robert M.tohnson
President
ATTEST: /Amp
r
[Signature page of FWH; Fairwood Hospitality; Fairwood Investors]
72
ACKNOWLEDGMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day before me, the undersigned being a Notary Public of and for the
County and State aforesaid, personally appeared Mark Stodola and Susan Langley, who
acknowledged themselves to be the Mayor and City Clerk, respectively, of the City of
Little Rock, Arkansas, a city of the first class, and that they, as such officers, being
authorized so to do, executed the foregoing instrument for the consideration, uses and
purposes therein contained, by signing the name of the city of first class by themselves as
such officers.
WITNESS My hand and official seal on this day of February, 2013.
OWL Pk2 -
Notarl/Jublic C)
My commission expires:
an-e 10, q0W
(SEAL)
TOYA ROBINSON
PULASKI COUNTY
NOTARY PUBUC-ARKANSAS
10,Cann talar+Eagaire&Jurre 1O 2020
CzowrissicrtNs.12277434
73
ACKNOWLEDGMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day, before me, the undersigned being a Notary Public of and for the
County and State aforesaid, personally appeared WARREN SIMPSON, who
acknowledged himself to be the CHAIRMAN of the LITTLE ROCK ADVERTISING
AND PROMOTION COMMISSION, and that he, as such officer, being authorized so to
do, executed the foregoing instrument for the purposes therein contained, by signing the
name of the city of first class by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal on this /-ZK
day of February, 2013.
rotary Public
My commission expires:
JAMIE HUTCHINS
SALINE COUNTY
NOVA'? -,v„v o‘o
My Commleson Expires April 10,2018
......._(„4"1/4731.,plon No.12385044
74
ACKNOWLEDGMENT
STATE OF 7 'rI )
COUNTY OF S4 b ))§§
On this day personally appeared before the undersigned, a Notary Public within
and for the County and State aforesaid, duly qualified, commissioned and acting,
Rolp .€+-Wl. S t).,brr.) to me well known, who stated that he is the
�rr�► de1•+k' of Fairwood Investors II, LLC, the Manager of Fairwood
Hospitality Investors II, L.L.C., the Member of FWH II LITTLE ROCK, LLC, a
Delaware limited liability company, and is duly authorized in his capacity to execute the
foregoing instrument for and in the name and on behalf of Fairwood Investors II, LLC, as
the Manager of Fairwood Hospitality Investors II, L.L.C., as the Member of FWH II
LITTLE ROCK, LLC, a Delaware limited liability company, and further stated and
acknowledged that he had so signed, executed and delivered this instrument for the
consideration, uses and purposes therein mentioned by signing the name of the limited
liability company by himself as said limited liability company officer.
WITNESS My hand and official seal on this? rxday of February, 2013.
Notary Public
My commission expires: gs \
pK. N,0
TATE din
OF
TENNESSEE
(SEAL) NOTARY
PUBLfC .�
*)'OF S*-
MY COMMISSION EXPIRES AUGUST 16,2014
75
f
LIST OF EXHIBITS
Exhibit"A" Conference Center
Exhibit"B" Demised Premises
Exhibit"C" Excepted Premises/Statehouse Convention Center
Exhibit "D" Assignment, Assumption, and First Amendment to Parking Lot
Lease Agreements and Reaffirmation and Extension of Ashley
Street Parking Franchise
Exhibit"E" Estoppel Statement from Lessor and Lessor's Former Lessee
Regarding Demised Premises
Exhibit "F" Estoppel Statement regarding hazardous or other adverse
conditions of Demised Premises
Exhibit"G" Property along River Bank and Parking Lot—Restrictive
Covenants Parcel
Exhibit"H" Parking Lot Parcel—NE 'A of Block 2, City of Little Rock
Right of First Refusal Parcel
EXHIBIT A
CONFERENCE CENTER
1160171-v1
EXHIBIT "A"
Conference Center
Parcel No.26: Conference Center Riverfront Park Level
Air rights between mean sea level elevations 265.32 and 277.79 for lease area as described below:
An area located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range 12
West, Pulaski County,Arkansas, being more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 123.89 feet; thence North 00 degrees 16 minutes 08 seconds East, 404.38 feet to
the Point of Beginning; thence easterly 31.00 feet to a set cotton picker spindle on the
Convention Center Tract 2 East property line; thence North 00 degrees 12 minutes 36 seconds
East, 60.70 feet along said East property line to a chiseled "X" in a concrete sidewalk; thence
westerly 43 .37 feet to a concrete walkway; thence along a curve to the left for a distance of
208.88 feet to a point 10.00 feet North of an existing brick wall, said curve having a radius of
72.88 feet and a central angle of 180 degrees 00 minutes 00 seconds; thence westerly along a
line 10.0 feet North of and parallel to brick wall 123.64 feet to a set 1/2 inch rebar on the
Convention Center Tract 2 West property line; thence South 00 degrees 12 minutes 36 seconds
West, 60.70 feet along said west property line to a set 1/2 inch rebar; thence easterly 12.47 feet
to the corner of a brick wall; thence easterly along the brick wall 267.91 feet to the Point of
Beginning.
Parcel No. 27: Conference Center Intermediate Level
Air rights between mean sea level elevations 277.79 and 290.32 for lease area as described below:
An area located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range 12
West, Pulaski County, Arkansas, being more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 123.89 feet; thence North 00 degrees 16 minutes 08 seconds East, 404.38 feet
to the Point of Beginning; thence continuing North 00 degrees 16 minutes 08 seconds East, 3.37
feet to a corner; thence northerly along the exterior face of a brick building the following
bearings and distances; northerly 26.60 feet to a corner; easterly 15.50 feet to a corner;
northerly 14.02 feet to a corner; westerly 17.98 feet to a corner; northerly 4.38 feet to a corner;
easterly 2.48 feet to a corner; northerly 2.33 feet to a corner; westerly 12.16 feet to a corner;
thence along the exterior face of a brick wall along a curve to the left for a distance of 228.96
feet to a corner, said curve having a radius of 72.88 feet and a central angle of 180 degrees 00
minutes 00 seconds; thence westerly 110.70 feet; thence southerly 50.70 feet to a corner; thence
easterly along the exterior face of a brick building 267.91 feet to the Point of Beginning.
All as shown in that certain survey prepared by McCaskill & Associates, Inc. dated February 21,
2013.
A-1
EXHIBIT "B"
DEMISED PREMISES
EXHIBIT"B"
Demised Premises
Parcel No. 1: La Hann Level - Service Area (Hotel)
Air rights between mean sea level elevations 271.03 and 290.32 for demised premises as
described below:
An area lying in Lots 1 and 2 of Fractional Block 80, Lot 6 of Block 79, and part of the
abandoned right of way of North Louisiana Street between West Markham Street and La Harpe
Boulevard, all in the Original City of Little Rock, Pulaski County, Arkansas, being more
particularly described as follows:
Commencing at the Southeast corner of said block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 434.03 feet; thence
North 00 degrees 16 minutes 08 seconds East, 178.98 feet to a point of beginning on the
Southeast corner of a loading dock at the Southwest corner of a concrete block wall; thence
northerly along the West edge of a column line 98.36 feet to an "X" chiseled in a concrete paved
truck access area; thence easterly 93.67 feet to a point on the northerly exterior face of a
concrete block wall; thence southerly through the concrete block wall 0.65 feet to an interior
room corner, thence continuing southerly 23.37 feet along the westerly face of a partition wall
to an interior room corner; thence continuing southerly 0.60 feet through a partition wall to the
southerly face of a partition wall, thence easterly along the face of the partition wall 18.47 feet
to the westerly face of a column; thence southerly along the face of the column 1.67 feet to the
Southwest corner of the column; thence easterly along the southerly face of the column 2.03 feet
to a point on the westerly face of a partition wall; thence southerly along the westerly face of
the wall 22.27 feet to a point on the interior of a column; thence easterly 0.60 feet to the
intersection of the easterly face of the column and the southerly face of partition wall; thence
easterly along the southerly face of the wall, 11.37 feet to the westerly face of a column; thence
continuing easterly 2.63 feet through the column to the intersection of the easterly face of the
column and the southerly face of a partition wall; thence continuing easterly 15.35 feet along
the southerly face of the wall to an interior room corner on the westerly face of a concrete block
wall; thence continuing easterly 0.65, feet through the concrete block wall to the easterly face of
the concrete block wall; thence southerly along the easterly face of the concrete block wall
63.88 feet; thence westerly 0.65 feet through the concrete block wall to the northerly face of a
partition wall; thence continuing westerly along the face of the partition wall 82.41 feet to an
interior room corner; thence northerly along the easterly face of partition wall 6.50 feet, thence
westerly 0.60 feet through the partition wall to the northerly face of a partition wall; thence
continuing westerly along a partition wall 22.42 feet to a partition wall corner; thence northerly
along the easterly face of a partition wall 9.46 feet to an interior wall corner, thence westerly
0.60 feet through the partition wall to a partition wall corner; thence westerly along the
southerly face of a partition wall 9.00 feet to the easterly face of a concrete block wall; thence
southerly along the easterly face of the concrete block wall 1.88 feet to the Southeast corner of
the concrete block wall; thence westerly along the southerly face of the concrete block wall
27.92 feet to the corner of a non-structural sheetrock column; thence continuing westerly along
the southerly face of the concrete block wall 1.17 feet to the Point of Beginning.
B-1
1160171-v1
Parcel No. 2: La Harpe Level - Elevator Pit Exterior (Hotel)
Air rights between mean sea level elevations 271.03 and 290.32 for demised premises as
described below:
An area lying in Lots 2 and 3 of Fractional Block 80 of the Original City of Little Rock, Pulaski
County,Arkansas, being more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees, 43 minutes, 52 seconds West along the North right of way line of Markham
Street 464.31 feet; thence North 00 degrees, 16 minutes, 08 seconds East, 171.75 feet to a Point
of Beginning at the westernmost exterior concrete block wall corner of an elevator pit; thence
North 45 degrees East along the exterior face of a concrete block wall 19.57 feet to the
northernmost corner of the elevator pit; thence South 45 degrees East along the exterior face of a
concrete block wall 3.67 feet to a point on the exterior face of a concrete wall; thence North 45
degrees East along the exterior face of the concrete wall 1.01 feet to a corner; thence South 45
degrees East along the exterior face of a concrete wall 6.05 feet to the easternmost corner of the
elevator pit; thence South 45 degrees West along the exterior face of a concrete wall 21.65 feet
to the southernmost corner of the elevator pit; thence North 45 degrees West along a concrete
wall 6.02 feet to the exterior corner of a concrete wall; thence North 45 degrees East along the
exterior face of a concrete wall 1.07 feet to a point on the exterior face of a concrete block wall;
thence North 45 degrees West along the exterior face of the concrete block wall 3.70 feet to the
Point of Beginning.
Parcel No. 3: La Harpe Level- Elevator Pit Interior (Hotel)
Air rights between mean sea level elevations 271.03 and 290.32 for demised premises as
described below:
An area lying in Lot 2 of Fractional Block 80 and the East-West Alleyway of Fractional Block 80
of the Original City of Little Rock, Pulaski County, Arkansas, being more particularly described
as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 446.70 feet; thence North 00 degrees 16 minutes 08 seconds East, 153.97 feet to
a Point of Beginning at the westernmost interior concrete corner of an elevator pit; thence North
45 degrees East along a concrete wall of the elevator pit 19.66 feet to the northernmost interior
corner of the elevator pit; thence South 45 degrees East along a concrete wall 4.00 feet to a
corner; thence continuing South 45 degrees East through a concrete wall 1.19 feet to an interior
corner; thence continuing South 45 degrees East along the interior concrete wall 3.83 feet to a
concrete block interior corner; thence southerly along the concrete block wall 4.21 feet to a
corner; thence South 45 degrees West along the interior concrete block wall 13.79 feet to a
corner; thence westerly along the interior concrete block wall 4.18 feet to a corner; thence
North 45 degrees West along the interior concrete block and concrete wall 3.88 feet to a corner;
thence continuing North 45 degrees West through an interior concrete wall 1.18 feet to a
B-2
corner; thence continuing North 45 degrees West along the concrete wall 3.97 feet to the Point
of Beginning.
Parcel No.4: La Harpe Level—Lobby Fountain Access (Hotel)
Air rights between mean sea level elevations 271.03 and 290.32 for demised premises as
described below:
An area lying in Lots 11 and 12 of Fractional Block 80 and the East-West alleyway of Fractional
Block 80 of the Original City of Little Rock, Pulaski County, Arkansas; being more particularly
described as follows:
Commencing at the Southeast corner of Block 79, of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 424.94 feet; thence North 00 degrees 16 minutes 08 seconds East 140.50 feet to a
Point of Beginning on the face of a partition wall; thence northerly 0.60 feet through the
partition wall to a corner of the partition wall; thence northerly along the exterior face of the
partition wall 2.65 feet to a corner; thence North 45 degrees East along the exterior face of a
partition wall 17.62 feet to a corner; thence easterly along the exterior face of a partition wall
11.77 feet; thence southerly 0.60 feet through a partition wall to an interior partition wall
corner; thence continuing southerly along the East face of a partition wall 13.95 feet to a corner;
thence continuing southerly 0.60 feet through a partition wall to its southerly face; thence
westerly along the wall 24.27 feet to the Point of Beginning.
Parcel No. 5: Markham Level -Lobby. Lounge and Food Services (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for demised premises as described
below:
A tract of land situated in Lot 1, part of Lots 2, 3, 10, 11 and 12, all of the East-West Alleyway
of Fractional Block 80, and part of Lots 6 and 7 of Block 79 and the East-West Alleyway of
Block 79, all in the Original City of Little Rock, Pulaski County, Arkansas; a part of the right of
way of the Missouri Pacific Railroad; a part of the right of way of La Harpe Boulevard and part
of the abandoned right of way of North Louisiana Street between West Markham Street and La
Harpe Boulevard: being more particularly described as follows:
Commencing at the Southeast corner of said Block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 481.50 feet; thence
North 00 degrees 16 minutes 08 seconds East, 41.65 feet to a Point of Beginning at the Southwest
corner of an exterior brick wall; thence North along the exterior face of a bricked column line
22938 feet to an exterior corner of the brick wall; thence East along the brick wall 7.01 feet to a
corner of the brick wall; thence North 45 degrees East along the brick wall 17.87 feet to a
corner: thence northerly along the brick wall 13.30 feet to a corner; thence easterly along the
brick wall 26.60 feet to a corner; thence North 45 degrees East along the brick wall 60.71 feet to
a corner; thence northerly along the brick wall 90.82 feet to a northerly edge of the upper
terrace to a corner; thence easterly along the brick wall 84.30 feet to a corner; thence northerly
along the brick wall 2 3 .6 5 feet to the North face of a brick wall; thence easterly along the
North face of the brick wall 13.75 feet; thence southerly along the westerly end of a brick wall
B-3
2.47 feet to a corner; thence easterly along the brick wall 5.34 feet to a corner; thence southerly
along a concrete block wall 9.74 feet; thence westerly along a brick wall 5.35 feet to a corner;
thence southerly along a brick wall 21.99 feet to a corner; thence easterly along a brick wall
5.90 feet to a point on the exterior face of a door frame; thence southerly along the westerly
face of the door frame 11.80 feet to a brick wall; thence westerly along a brick wall 2.34 feet to
a corner; thence southerly along a brick wall 4.36 feet to a corner; thence easterly along the
brick wall 2.34 feet to the exterior face of a door frame; thence southerly along the westerly
face of the door frame 8.41 feet to the point of intersection of the doorway with the northerly
face of a partition wall projected westerly; thence easterly along the projected face of the
partition wall and the northerly face of the partition wall 7.25 feet; thence southerly along the
westerly face of a column line 83.30 feet; thence westerly, parallel to and 3.5 feet South of a
glass wall for a distance of 11.02 feet; thence South 45 degrees West, parallel to and 3.5 feet
southeasterly from a glass wall for a distance of 7.72 feet; thence westerly, parallel to and 2.0
feet South of a partition wall for a distance of 10.27 feet; thence southerly across a foyer and
through a column in the center of the foyer 22.00 feet; thence easterly, parallel to and 2.0 feet
North of a partition wall for a distance of 10.25 feet; thence South 45 degrees East, parallel to
and 3.5 feet northeasterly of a glass wall for distance of 8.0 feet; thence easterly parallel to and
3.5 feet northerly of a glass wall for a distance of 10.75 feet; thence southerly along the
westerly face of a column line 104.87 feet to a partition wall; thence easterly along the partition
wall 2.33 feet to a corner; thence southerly along the partition wall 33.75 feet to a corner;
thence South 27 degrees 27 minutes West across the "Great Lobby" 33.36 feet a point on the
interior of a column at the intersection with the easterly projection of the southerly face of a
gutter line above the Markham Street level; thence westerly along the southerly gutter line and
its projections easterly for distance of 67.01 feet; thence South 45 degrees West along the
southeasterly gutter line 40.10 feet; thence southerly continuing along the easterly gutter line
11.50 feet; thence westerly along the center of the column line 28.92 feet to the easterly face of
a brick wall; thence southerly along the brick wall 14.69 feet to a corner; thence westerly along
a brick wall 16.54 feet to a corner; thence southerly along the brick wall 14.76 feet to a corner
of the brick wall; thence westerly along the brick wall 47.48 feet to the Point of Beginning.
Parcel No. 6: Markham Level - Retail (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for demised premises as
described below:
An area located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1 North,
Range 12 West, Pulaski County, Arkansas, and comprising part of the right of way of the
Missouri Pacific Railroad and part of the right of way of La Harpe Boulevard; being more
particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 227.55 feet; thence North 00 degrees 16 minutes 08 seconds East 307.74 feet to a
Point of Beginning situated on the exterior face of a brick wall; thence northerly along the
exterior face of the brick wall 100.52 feet; thence West through the brick wall, along the
northerly face of a column and along the southerly face of a partition wall 32.32 feet to the
easterly face of a column line extended; thence southerly along the face of the column line
B-4
87.25 feet to the intersection of the easterly face of the column line with the southerly face of a
partition wall column projected westerly; thence easterly along the projected southerly face of
the column 19.80 feet; thence South 45 degrees East, 18.20 feet along the northwesterly
projection of a partition wall column, along the southwesterly face of the partition wall column,
and through a brick wall to the Point of Beginning.
Parcel No. 7: Markham Level - Escalator and Stairs (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for demised premises as
described below:
An area located in Lots 5 and 6 of Block 79 of the Original City of Little Rock, and in La Harpe
Boulevard, all in the Southeast Quarter, Northeast Quarter of Section 3, Township 1 North,
Range 12 West, Pulaski County,Arkansas; being more particularly described as follows:
Commencing at the Southeast corner of Block 79; thence North 89 degrees 43 minutes 52 seconds
West along the North right of way line of West Markham Street 268.81 feet; thence North 00
degrees 16 minutes 08 seconds East, 287.08 feet to a Point of Beginning situated at the Southwest
corner of a partition wall; thence northerly along the partition wall 18.60 feet to a corner; thence
easterly along the partition wall 29.20 feet; thence southerly 18.60 feet; thence westerly 29.20
feet to the Point of Beginning.
Parcel No. 8: Markham Level - Retail (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for demised premises as
described below:
An area located in Lots 5 and 6 of Block 79 of the Original City of Little Rock, Pulaski County,
Arkansas; being more particularly described as follows:
Commencing at the Southeast corner of said Block 79, thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 213.96 feet; thence
North 00 degrees 16 minutes 08 seconds East, 258.46 feet to a Point of Beginning situated at the
intersection of a concrete block wall and a partition wall; thence northerly along the easterly
face of the partition wall and through a partition wall 22.20 feet to its northerly face; thence
westerly along the northerly face of the partition wall 18.78 feet; thence South 45 degrees West,
parallel to and 3.6 feet northwesterly of a glass wall 11.94 feet; thence westerly, parallel to and
2.0 feet North of a partition wall for a distance of 15.30 feet; thence southerly to and then along
the partition wall 13.80 feet; thence easterly through the partition wall and along the northerly
face of a concrete block wall 42.60 feet to the Point of Beginning.
And also, beginning at the above described Point of Beginning, thence northerly along the
easterly face of a partition wall and through a partition wall 22.20 feet to the northerly face of
the corridor wall; thence easterly along the northerly face of the South corridor wall 13.70 feet
to the end wall of the corridor; thence northerly 5.0 feet to the South face of a brick wall;
thence easterly along the South face of the brick wall 9.2 feet; thence southerly along the West
face of a brick wall 27.20 feet; thence westerly along the North face of a block wall 22.9 feet to
the Point of Beginning.
B-5
Parcel No. 10: Ballroom Level (Hotel)
Air rights between the top of a floor slab at mean sea level elevation 308.32 and the center of a
floor slab at elevation 329.25 for demised premises as described below:
An area located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1 North,
Range 12 West, Pulaski County, Arkansas, and comprising all of Lot 1 and part of Lots 2, 3, 10,
11 and 12 and all of the East-West Alleyway of Fractional Block 80, and part of Lots 4, 5, 6 and
7 and part of the East-West Alleyway of Block 79, all of the Original City of Little Rock; part
of the right of way of the Missouri Pacific Railroad; part of the right of way of La Harpe
Boulevard; part of the abandoned right of way of North Louisiana Street between West
Markham Street and La Harpe Boulevard, and part of the abandoned right of way of Ashley
Street between La Harpe and West Markham; more particularly described as follows:
Commencing at the Southeast corner of said Block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 481.50 feet; thence
North 00 degrees 16 minutes 08 seconds East 41.65 feet to a Point of Beginning situated on an
exterior Southwest corner of a brick wall; thence northerly along the exterior face of a bricked
column line 229.72 feet to a corner; thence easterly along the brick wall 6.90 feet to a corner;
thence North 45 degrees East along the brick wall 17.87 feet to a corner; thence northerly along
the exterior face of the brick wall 13.30 feet to a corner; thence easterly along the brick wall
26.60 feet to a corner; thence North 45 degrees East along the brick wall 60.71 feet to a corner;
thence northerly along the brick wall 68.27 feet; thence easterly along a brick wall 164.86 feet
to a corner; thence southerly along the brick wall 99.71 feet to a corner; thence southeasterly
along the brick wall 9.67 feet to a corner; thence southerly along the brick wall 19.72 feet to a
corner; thence easterly along the brick wall 27.97 feet to a corner; thence southerly along the
brick wall 25.17 feet to a corner; thence westerly along the exterior face of the brick wall 62.85
feet to a corner; thence continuing westerly through the exterior wall and along the
southernmost edge of a balcony for a total distance of 16.37 feet to a corner of the balcony;
thence continuing along the outermost edges of the balcony southerly 93.90 feet and westerly
5.15 feet to the easterly wall of a stair enclosure; thence southerly along the projection of the
wall of the stair enclosure 52.21 feet through the sloping glass wall to a point above the
southernmost face of the gutter line at the toe of the sloping glass wall; thence westerly along
the southerly face of the. gutter 85.40 feet to a corner of the gutter; thence South 45 degrees
West along the southeasterly face of the gutter 40.10 feet to a corner of the canopy; thence
southerly along the easterly face of the gutter 41.10 feet; thence westerly to and along the
exterior face of a brick wall 92.94 feet to the Point of Beginning.
Parcel No. 11: Ballroom Level -Skvwalk (Hotel)
Air rights between mean sea level elevations 305.68 and 319.39 for demised premises as
described below:
A portion of Lot 11 of Fractional Block 80 of the Original City of Little Rock, Pulaski County,
Arkansas, being more particularly described as follows:
B-6
Commencing at the Southeast corner of Block 79 of the said Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 424.38 feet to a Point of Beginning situated on the easternmost edge of a
skywalk; thence North 00 degrees 23 minutes 21 seconds East along the easternmost edge of the
skywalk 41.52 feet to the face of a brick building wall; thence North 88 degrees 53 minutes 46
seconds West along the brick wall 8.96 feet to a point on the Northwest corner of the skywalk;
thence South 00 degrees 15 minutes 15 seconds West along the westernmost edge of the
skywalk 41.65 feet to the North right of way line of West Markham Street; thence continuing
South 00 degrees 15 minutes 15 seconds West along the edge of the skywalk 60 feet to the
South right of way line of Markham Street; thence South 89 degrees 43 minutes 52 seconds East
along the South right of way line of West Markham Street 8.72 feet to the easternmost edge of
the skywalk; thence North 00 degrees 23 minutes 21 seconds East along the edge of the skywalk
60 feet to the Point of Beginning.
Parcel No. 14: Hotel Guest Tower- All Levels (Hotell
Air rights above elevation 329.25 for demised premises as described below:
An area lying in Block 79, Fractional Block 80 and in the abandoned right of way of North
Louisiana Street between West Markham Street and La Harpe Boulevard, all in the Original City
of Little Rock, Pulaski County,Arkansas being more particularly described as follows:
( Commencing at the Southeast corner of said Block 79, thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 481.50 feet; thence
North 00 degrees 16 minutes 08 seconds East, 56.15 feet to a Point of Beginning at the corner
of the exterior edge of a brick tower; thence northerly along the westerly exterior edge of the
tower 101.40 feet to a corner; thence easterly 12.7 feet to a point on the face of the brick wall
where a circular wall intersects at the upper two floor levels; thence along the circular wall or
its projections along a radius of 35 feet and arc of 55.0 feet to the westerly face of a brick wall;
thence along the outermost perimeter of the tower structure the following courses and
distances: Northerly 12.7 feet; easterly 157.55 feet; southerly 46.3 feet; westerly 14.1 feet;
southerly 18.15 feet; westerly 111.4 feet; South 45 degrees West, 21.45 feet; southerly 83.2
feet; westerly 35.65 feet; northerly 5.5 feet; westerly 14.1 feet; northerly 9.0 feet; and westerly
14.6 feet to the Point of Beginning.
Parcel No. 15: West Markham Street-Air Rights
Air rights over a portion of West Markham Street between mean sea level elevation 304.33 and
319.39 for the tract of land described below:
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1
North, Range 12 West, Pulaski County, Arkansas, said tract being a portion of the right of way
of West Markham Street adjacent to Fractional Block 80 and Block 81, Original City of Little
Rock,said tract being more particularly described as follows:
Commencing at the Southwest corner of said Fractional Block 80; thence along said North right
of way line of West Markham Street South 89 degrees 43 minutes 52 seconds East,45.75 feet to
the Point of Beginning; thence continue along said North right of way line of West Markham
B-7
Street South 89 degrees 43 minutes 52 seconds East, 12.00 feet to a point; thence South 00
degrees 16 minutes 08 seconds West, 60.00 feet to a point, said point being on the South right
of way line of West Markham Street; thence along the said South right of way line of West
Markham Street North 89 degrees 43 minutes 52 seconds West, 12.00 feet to a point; thence
North 00 degrees 16 minutes 08 seconds East, 60.00 feet to the Point of Beginning.
Together with easements and cross easements for access, ingress, egress, support and
maintenance over, through and across the following described tracts, as described on attached
sheets as Convention Center Tract 1;Convention Center Tract 2; La Harpe Boulevard Air Rights
and Easement Tract; Missouri Pacific Railroad - Air Rights; West Markham Street - air rights;
North Main Street- Franchise Tract; West Markham Street - Franchise Tract and Ashley Street -
Franchise Tract.
Parcel No. 19: West Markham Street Franchise Tract
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1
North, Range 12 West,Pulaski County,Arkansas, said tract being a portion of the right of way
of West Markham Street, South of and adjacent to a portion of Fractional Block 80 and Block
79,Original City of Little Rock,said tract being more particularly described as follows:
Commencing at the Southwest corner of said Fractional Block 80; thence along said North right
of way line of West Markham Street South 89 degrees 43 minutes 52 seconds East, 43.67 feet to
the Point of Beginning; thence continue along said North right of way line of West Markham
Street South 89 degrees 43 minutes 52 seconds East, 311.50 feet to a point; thence South 00
degrees 16 minutes 08 seconds, West 9.50 feet to a point; thence along a line that is 9.50 feet
South of and parallel to said North right of way line of West Markham Street North 89 degrees
43 minutes 52 seconds West, 311.50 feet to a point; thence North 00 degrees 16 minutes 08
seconds East, 9.50 feet to the Point of Beginning.
Parcel No. 23: Kitchen Area (Hotel)
Air rights between mean sea level elevations 302.61 (finished floor elevation) and 317.65 to
318.32 (bottom of sloping roof deck) for lease are described below:
An area located in the Southeast 1/4 Northeast 1/4, Section 3, Township 1 North, Range 12
West, Pulaski County, Arkansas, said area being a part of Lot 7, Block 1,Original City of Little
Rock, and part of the abandoned right of way of North Main Street, said area being more
particularly described as follows:
Commencing at a found 1/2 inch rebar at the intersection of the North right of way line of West
Markham Street and the East right of way line of Ashley Street, said point being 2.00 feet North
89 degrees 43 minutes 52 seconds West of the Original Southwest corner of Fractional Block 80,
Original City of Little Rock; thence South 89 degrees 43 minutes 52 seconds East, 460.58 feet
along the North right of way line of West Markham Street; thence North 00 degrees 16 minutes
08 seconds East 17.1 feet to the Southwest corner of an overhead exterior wall; thence
northerly along the exterior wall 1.17 feet to the centerline of an East-West column line
westerly extended; thence easterly along said East-West column line 55.5 feet to the centerline
of a column; thence northerly along the centerline of a North-South column line 13.67 feet;
B-8
thence easterly 1.00 feet to an interior wall corner and the Point of Beginning; thence along the
interior face of a wall the following bearings and distances; northerly 23.33 feet to a corner;
westerly 14.25 feet to a corner; northerly 11.42 feet to a corner; westerly 12.67 feet to a
corner; northerly 22.17 feet to a corner; easterly 91.83, feet to a corner; southerly 17.83 feet to a
corner; South 85 degrees 30 minutes West, 38.36 feet to a point in the face of a wall; southerly
6.08 feet to a corner; westerly 26.67 feet to the Point of Beginning.
Parcel No. 25: Vacated Ashley Street R.O.W. (Hotel)
The East 12 inches of the right of way of Ashley Street between Markham Street and La Harpe
Boulevard in the City of Little Rock, Pulaski County, Arkansas as vacated by Ordinance No.
13,846 recorded August 19, 1980 as Instrument No. 80-35197 and the West 12 inches of the
East 24 inches of the right of way of Ashley Street between Markham Street and LaHarpe
Boulevard as vacated by Ordinance No. 14,428 recorded April 8, 1983 as Instrument No. 83-
16677.
Parcel No. 26: Conference Center Riverfront Park Level (Hotel)
Air rights between mean sea level elevations 265.32 and 277.79 for lease area as described below:
An area located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range 12
West, Pulaski County,Arkansas, being more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 123.89 feet; thence North 00 degrees 16 minutes 08 seconds East, 404.38 feet to
the Point of Beginning; thence easterly 31.00 feet to a set cotton picker spindle on the
Convention Center Tract 2 East property line; thence North 00 degrees 12 minutes 36 seconds
East, 60.70 feet along said East property line to a chiseled "X" in a concrete sidewalk; thence
westerly 43 .37 feet to a concrete walkway; thence along a curve to the left for a distance of
208.88 feet to a point 10.00 feet North of an existing brick wall, said curve having a radius of
72.88 feet and a central angle of 180 degrees 00 minutes 00 seconds; thence westerly along a
line 10.0 feet North of and parallel to brick wall 123.64 feet to a set 1/2 inch rebar on the
Convention Center Tract 2 West property line; thence South 00 degrees 12 minutes 36 seconds
West, 60.70 feet along said west property line to a set 1/2 inch rebar; thence easterly 12.47 feet
to the corner of a brick wall; thence easterly along the brick wall 267.91 feet to the Point of
Beginning.
Parcel No. 27: Conference Center Intermediate Level (Hotel)
Air rights between mean sea level elevations 277.79 and 290.32 for lease area as described below:
An area located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range 12
West, Pulaski County,Arkansas,being more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence
North 89 degrees 43 minutes 52 seconds West along the North right of way line of West
Markham Street 123.89 feet; thence North 00 degrees 16 minutes 08 seconds East, 404.38 feet
B-9
to the Point of Beginning; thence continuing North 00 degrees 16 minutes 08 seconds East, 3.37
feet to a corner; thence northerly along the exterior face of a brick building the following
bearings and distances; northerly 26.60 feet to a corner; easterly 15.50 feet to a corner;
northerly 14.02 feet to a corner; westerly 17.98 feet to a corner; northerly 4.38 feet to a corner;
easterly 2.48 feet to a corner; northerly 2.33 feet to a corner; westerly 12.16 feet to a corner;
thence along the exterior face of a brick wall along a curve to the left for a distance of 228.96
feet to a corner, said curve having a radius of 72.88 feet and a central angle of 180 degrees 00
minutes 00 seconds; thence westerly 110.70 feet; thence southerly 50.70 feet to a corner; thence
easterly along the exterior face of a brick building 267.91 feet to the Point of Beginning.
Parcel No. 28: Markham Level-Plaza Public Lobby, Promenade and Lobby (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for lease area as described
below; promenade and public lobby height varies, extending above elevation 308.32 to existing
ceiling structure; plaza area bounded only by lower elevation 290.32.
A tract of land located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range
12 West, Pulaski County, Arkansas, said tract comprising part of Lots 10, 11, 12, Fractional
Block 80, and part of Lots 6 and 7, Block 79, all in the Original City of Little Rock, Pulaski
County, Arkansas; a part of the abandoned right of way of North Louisiana Street between West
Markham Street and La Harpe Boulevard; a part of the right of way of La Harpe Boulevard; a
part of the right of way of the Union Pacific Railroad; and an area North of and adjacent to
stated area of right of way of said Union Pacific Railroad; said tract being more particularly
described as follows:
Commencing at the Southeast corner of said Block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way of West Markham Street 255.35 feet to the Point of
Beginning; thence continuing North 89 degrees 43 minutes 52 seconds West along said North
right of way line 226.15 feet; thence North 00 degrees 16 minutes 08 seconds East, 41.65 feet to
the Southwest corner of an exterior brick wall; thence easterly along the brick wall 47.48 feet to
the corner of the brick wail; thence northerly along the brick wall 14.76 feet to a corner of the
brick wall; thence easterly along a brick wall 16.54 feet to a corner; thence northerly along the
brick wall 14.69 feet to a corner; thence easterly along the center of the column line 28.92 feet
to a point of intersection of said column line and the easterly face of a gutter line above the
Markham Street level; thence northerly along said easterly gutter line 11.50 feet; thence
continuing along said easterly gutter line North 45 degrees East, 40.10 feet to a point of
intersection of said easterly gutter line and southerly face of a gutter line; thence easterly along
said southerly gutter line and its projections easterly for a distance of 67.01 feet to a point on
the interior of a column; thence North 27 degrees 27 minutes East across the "Great Lobby"
33.36 feet to a partition wall corner; thence northerly along the partition wall 33.75 feet to a
corner; thence westerly along the partition wall 2.33 feet to a point of intersection of the
partition wall and the westerly face of a column line; thence northerly along the westerly face of
a column line 104.87 feet; thence westerly parallel to and 3.5 feet northerly of a glass wall for a
distance of 10.75 feet; thence North 45 degrees West, parallel to and 3.5 feet northeasterly of a
glass wall for a distance of 8.0 feet; thence westerly, parallel to and 2.0 feet North of a partition
wall for a distance of 10.25 feet; thence northerly across a foyer and through a column in the
center of the foyer 22.00 feet; thence easterly, parallel to and 2.0 feet south of a partition wall
B-10
for a distance of 10.27 feet; thence North 45 degrees East, parallel to and 3.5 feet southeasterly
of a glass wall for a distance of 7.72 feet; thence easterly, parallel to and 3.5 feet South of a
glass wall for a distance of 11.02 feet; thence northerly along the westerly face of it column line
83.30 feet; thence westerly along the projected face of the partition wall and the northerly face
of the partition wall 7.25 feet to the point of intersection of a doorway and the northerly face of
a partition wall projected westerly; thence northerly along the westerly face of the door frame
8.41 feet to a brick wall; thence westerly 2.34 feet to a corner; thence northerly along a brick
wall 4.36 feet to a corner; thence easterly along a brick wall 2.34 feet to the westerly face of a
door frame; thence northerly along the westerly face of the door frame 11.80 feet to a brick
wall; thence westerly along a brick wall 5.90 feet to a corner; thence northerly along a brick
wall 21.99 feet to a corner; thence easterly along a brick wall 5.35 feet; thence northerly along a
concrete block wall 9.74 feet to a corner; thence westerly along a brick wall 5.34 feet to a
corner, thence northerly along the westerly end of a brick wall 2.47 feet to a corner; thence
easterly along a brick wall 65.80 feet to a corner; thence southerly along a brick wall 46.42 feet;
thence westerly through a brick wall, along the northerly face of a column and along the
southerly face of a partition wall 32.32 feet to the easterly face of a column line extended;
thence southerly along the easterly face of the column line 103.26 feet to a partition wall;
thence westerly along the partition wall 7.95 feet to a corner; thence southerly along a partition
wall 18.60 feet to a corner; thence easterly along a partition wall 11.18 feet; thence southerly to
and then along a partition wall 287.14 feet to the Point of Beginning.
Parcel No. 29: Markham Level -Escalator Lobby (Hotel)
Air rights between mean sea level elevations 290.32 and 308.32 for demised premises as
described below:
An area located in Lots 5 and 6 of Block 79 of the Original City of Little Rock, and in La Harpe
Boulevard, all in the Southeast Quarter, Northeast Quarter of Section 3, Township 1 North,
Range 12 West, Pulaski County, Arkansas; being more particularly described as follows:
Commencing at the Southeast corner of Block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 255.35 feet; thence
North a distance of 287.14 feet to the Point of Beginning; thence easterly a distance of 18.02 feet
to a point; thence northerly a distance of 18.60 feet to a point; thence westerly a distance of 21.25
feet to a point; thence northerly a distance of 15.13 feet to a point; thence easterly a distance of
20.89 feet to a point; thence S 45 degrees 00 minutes 00 seconds E a distance of 21.40 feet to a
point; thence easterly a distance of 2.38 feet to a point; thence S 00 degrees 16 minutes 08
seconds W a distance of 25.28 feet to a point; thence westerly a distance of 10.29 feet to a point;
thence S 45 degrees 00 minutes 00 seconds W a distance of 11.94 feet to a point; thence westerly
a distance of 16.32 feet to a point; thence northerly a distance of 15.13 feet to the Point of
Beginning.
All as shown in that certain survey prepared by McCaskill & Associates, Inc. dated February 21,
2013.
B-11
EXHIBIT "C"
EXCEPTED PREMISES
STATEHOUSE CONVENTION CENTER
1160171-v1
r
EXHIBIT "C"
Excepted Premises
Parcel No. 16: Convention Center Tract 1
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1
North, Range 12 West, Pulaski County, Arkansas, said tract comprising part of Block 79, all of
Fractional Block 80, the abandoned right of way of North Louisiana Street between West
Markham Street and La Harpe Boulevard, and part of the Ashley Street right of way between
West Markham Street and La Harpe Boulevard, all a part of the Original City of Little Rock;
said tract being more particularly described as follows:
Beginning at the Southwest corner of the Original Fractional Block 80; thence along a westerly
extension of the North right of way line of West Markham Street North 89 degrees 43 minutes
52 seconds West, 2.00 feet to a point; thence along a line that is 2.00 feet West of and parallel
to the East right of way line of Ashley Street North 00 degrees 12 minutes 36 seconds East,
300.05 feet to a point, said point being on a westerly extension of the South right of way line of
La Harpe Boulevard; thence South 89 degrees 43 minutes 52 seconds East 2.00 feet to a point,
said point being the intersection of the East right of way line of Ashley Street with the South
right of way line of La Harpe Boulevard; thence continuing along said South right of way line
of La Harpe Boulevard South 89 degrees 43 minutes 52 seconds East, 330.13 feet to a point,
said point being the Northwest corner of Lot 3, said Block 79; thence South 79 degrees 46
minutes 17 seconds East, 152.35 feet to a point, said point being on the West right of way line
of North Main Street; thence along said West right of way line of North Main Street South 00
degrees 13 minutes 50 seconds West, 248.70 feet to a point; thence South 45 degrees 15 minutes
08 seconds West 35.34 feet to a point, said point being on the North right of way line of West
Markham Street; thence along the said North right of way line of West Markham Street North
89 degrees 43 minutes 52 seconds West 455.06 feet to the Point of Beginning.
Parcel No. 17: Convention Center Tract 2
A tract of land located in the Southeast Quarter, Northeast Quarter Section 3, Township 1
North, Range 12 West, Pulaski County, Arkansas, said tract being more particularly described as
follows:
Commencing at the Southwest corner of Fractional Block 80, Original City of Little Rock;
thence along a northerly extension of the East right of way line of Ashley Street North 00
degrees 12 minutes 36 seconds East, 397.13 feet to a point on the North right of way line of the
Missouri Pacific Railroad; thence northeasterly along said North right of way line along a curve
to the left having a radius of 865.32 feet for a distance of 66.25 feet, said curve having a chord
bearing and distance of North 88 degrees 58 minutes 35 seconds East, 66.23 feet; thence
continuing along said North right of way line North 86 degrees 46 minutes 59 seconds East,
10.00 feet to the Point of Beginning; thence North 00 degrees 12 minutes 36 seconds East, 74.35
feet to a point; thence South 89 degrees 47 minutes 24 seconds East, 101.38 feet to a point;
thence North 00 degrees 12 minutes 36 seconds East 23.00 feet to a point; thence North 45
degrees 12 minutes 36 seconds East 61.63 feet to a point; thence South 89 degrees 47 minutes 24
C-1
seconds East, 96.14 feet to a point; thence South 44 degrees 47 minutes 24 seconds East, 99.39
feet to a point; thence South 00 degrees 12 minutes 36 seconds West, 80.00 feet to a point on
the North right of way line of the Missouri Pacific Railroad; thence northwesterly along said
North right of way line along a curve to the left having a radius of 1166.08 feet for a distance of
116.33 feet, said curve having a chord bearing and distance of North 83 degrees 30 minutes 19
seconds West, 116.28 feet; thence continuing along said North right of way line a curve to the
left having a radius of 1166.08 for a distance of 139.49 feet, said curve having a chord bearing
and distance of North 89 degrees 47 minutes 24 seconds West, 139.41 feet; thence continuing
along said North right of way line South 86 degrees 46 minutes 59 seconds West, 56.49 feet to
the Point of Beginning.
Parcel No. 18: La Harpe Boulevard - Air Rights and Easement Tract
Air rights above mean sea level elevation 286.4 and for easement as required for intermediate
supports for structures to be constructed on said right of way, for the tract of land described
below:
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1
North, Range 12 West, Pulaski County, Arkansas, said tract consisting of a portion of the right
of way of La Harpe Boulevard, said tract being more particularly described as follows:
Commencing at the Southwest corner of Fractional Block 80, Original City of Little Rock;
thence along the West line of Fractional Block 80 North 00 degrees 12 minutes 36 seconds East,
300.05 feet to a point, said point being on the North line of Lot 3, said Block 80 and the Point
of Beginning; thence continuing North 00 degrees 12 minutes 36 seconds East, 63.57 feet to a
point, said point being on the North right of way line of La Harpe Boulevard; thence
northeasterly along said North right of way line of La Harpe Boulevard along a curve to the left
having a radius of 898.82 feet for a distance of 68.25 feet, said curve having a chord bearing
and distance of North 88 degrees 57 minutes 30 seconds East, 68.24 feet; thence continuing
along said North right of way line North 86 degrees 46 minutes 59 seconds East, 66.49 feet to a
point; thence southeasterly along said North right of way line along a curve to the right having
a radius of 1132.58 feet for a distance of 137.49 feet, said curve having a chord bearing and
distance of South 89 degrees 44 minutes 22 seconds East, 137.41 feet; thence South 00 degrees
12 minutes 36 seconds West, 69.20 feet to a point, said point being on the North line of Lot 5,
Block 79, Original City of Little Rock; thence North 89 degrees 43 minutes 52 seconds West
272.00 feet to the Point of Beginning.
Parcel No. 20: North Main Street- Franchise Tract
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3 and in the
Southwest Quarter Northwest Quarter, Section 2, all in Township 1 North, Range 12 West,
Pulaski County, Arkansas, said tract being a portion of the right of way of North Main Street
adjacent to Block 79, Original City of Little Rock, said tract being more particularly described
as follows:
Commencing at the Southeast Corner of said Block 79, said point being the intersection of the
North right of way line of West Markham Street with the West right of way line of North Main
C-2
(
Street; thence along said West right of way line of North Main Street North 00 degrees 13
minutes 50 seconds East, 133.00 feet to the Point of Beginning; thence South 89 degrees 46
minutes 10 seconds East, 21.33 feet to a point; thence North 00 degrees 13 minutes 50 seconds
East, 31.83 feet to a point; thence South 89 degrees 46 minutes 10 seconds East, 10.67 feet to a
point; thence North 00 degrees 13 minutes 50 seconds East, 40.83 feet to a point; thence North
56 degrees 31 minutes 20 seconds East, 104.58 feet to a point; thence North 84 degrees 57
minutes 58 seconds West, 119.42 feet to a point, said point being on said West right of way line
of North Main Street; thence along said West right of way line of North Main Street South 00
degrees 13 minutes 50 seconds West, 140.70 feet to the Point of Beginning.
Parcel No.21: Missouri Pacific Railroad - Air Rights
Air rights above mean sea level elevation 287.75, for the tract of land described below:
A tract of land located in the Southeast Quarter, Northeast Quarter, Section 3, Township 1
North, Range 12 West, Pulaski County, Arkansas, said tract consisting of a portion of the right
of way of the Missouri Pacific Railroad, said tract being more particularly described as follows:
Commencing at the Original Southwest corner of Fractional Block 80, Original City of Little
Rock; thence along the westerly line of said Block 80 North 00 degrees 12 minutes 36 seconds
East, 363.62 feet to a point, said point being on the South right of way line of the Missouri
Pacific Railroad and the Point of Beginning; thence continuing North 00 degrees 12 minutes 36
•
seconds.East, 33.51 feet to a point, said point being on the North right of way line of the
Missouri Pacific Railroad; thence northeasterly along said North right of way line of the
Missouri Pacific Railroad along a curve to the left having a radius of 865.32 feet for a distance
of 66.25 feet, said curve having a chord bearing and distance of North 88 degrees 58 minutes 35
seconds East, 66.23 feet; thence continuing along said North right of way line North 86 degrees
46 minutes 59 seconds East, 66.49 feet to a point; thence southeasterly along said North right of
way line along a curve to the right having a radius of 1166.08 feet for a distance of 139.49 feet,
said curve having a chord bearing and distance of South 89 degrees 47 minutes 24 seconds East,
139.41 feet; thence South 00 degrees 12 minutes 36 seconds West, 33.56 feet to a point, said
point being on the South right of way line of the Missouri Pacific Railroad; thence northwesterly
along said South right of way line of the Missouri Pacific Railroad along a curve to the left
having a radius of 1132.58 feet for a distance of 137.49 feet, said curve having a chord bearing
and distance of North 89 degrees 44 minutes 22 seconds West, 137.41 feet; thence continuing
along said South right of way line South 86 degrees 46 minutes 59 seconds West, 66.49 feet to a
point; thence southwesterly along said South right of way line along a curve to the right having
a radius of 898.82 feet for a distance of 68.25 feet, said curve having a chord bearing and
distance of South 88 degrees 57 minutes 30 seconds West, 68.24 feet to the Point of Beginning.
Parcel No. 24: Ashley Street Parking and Access Franchise
Franchise rights as granted by Ordinance No. 18,286 recorded August 24, 2000 as Instrument
No. 2000059888 and being more particularly described as follows:
C-3
A tract of land located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range
12 West, Pulaski County, Arkansas, said tract being West of Fractional Block 80, Original City
of Little Rock and being more particularly described as follows:
Beginning at a found 1/2 inch rebar at the intersection of the North right of way line of West
Markham Street and the East right of way line of Ashley Street, said point being 2.00 feet North
89 degrees 40 minutes 23 seconds West, of the Original Southwest corner of said Fractional
Block 80; thence North 00 degrees 12 minutes 36 seconds East, 300.05 feet along said East right
of way line of Ashley Street to a found "X" in concrete being the intersection of the East right
of way line of Ashley Street and the South right of way line of La Harpe Boulevard; thence
North 89 degrees 18 minutes 24 seconds West, 57.73 feet along said South right of way line of
La Harpe Boulevard to a found "X" on a concrete retaining wall being the intersection of the
South right of way line of La Harpe Boulevard and the West right of way line of Ashley Street;
thence South 00 degrees 12 minutes 36 seconds West, 300.42 feet along said West right of way
line of Ashley Street to the point of intersection of said West right of way line of Ashley Street
and the North right of way line of West Markham Street; thence South 89 degrees 40minutes 23
seconds East, 57.73 feet along said North right of way line of West Markham Street to the Point
of Beginning.
Parcel No. 30: La Harpe Level— Common Use Area (Subject to License Agreement)
Air rights between mean sea level elevations 271.03 and 290.32 for excepted premises as
described below:
An area lying in Lots 1, 2, & 3 of Fractional Block 80 and the East-West Alleyway of Fractional
Block 80 of the Original City of Little Rock, Pulaski County, Arkansas, being more particularly
described as follows:
Commencing at the Southeast corner of said block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 434.03 feet; thence
North 00 degrees 16 minutes 08 seconds East, 178.98 feet to a point of beginning on the
Southeast corner of a loading dock at the Southwest corner of a concrete block wall; thence
easterly a distance of 29.02 feet to a point; thence northerly a distance of 1.88 feet to a point;
thence easterly a distance of 9.60 feet to a point; thence southerly a distance of 9.46 feet to a
point; thence easterly a distance of 5.00 feet to a point; thence S 00 degrees 16 minutes 08
seconds W a distance of 15.26 feet to a point; N 89 degrees 43 minutes 52 seconds W a distance
of 10.48 feet to a point; thence continuing westerly a distance of 11.77 feet to a point; thence S
45 degrees 00 minutes 00 seconds W a distance of 17.62 feet to a point; thence S 00 degrees 52
minutes 06 seconds W a distance of 2.69 feet to a point; thence N 89 degrees 43 minutes 52
seconds W a distance of 11.20 feet to a point; thence northerly a distance of 6.48 feet to a point;
thence N 45 degrees 00 minutes 00 seconds E a distance of 13.79 feet to a point; thence northerly
a distance of 4.21 feet to a point; thence N 45 degrees 00 minutes 00 seconds W a distance of
9.02 feet to a point; thence S 45 degrees 00 minutes 00 seconds W a distance of 19.66 feet to a
point; thence westerly a distance of 6.09 feet to a point; thence northerly a distance of 15.55 feet
to a point; thence N 45 degrees 00 minutes 00 seconds E a distance of 13.29 feet to a point;
easterly a distance of 9.48 feet to the point of beginning.
C-4
Parcel No. 31: La Harpe Level—Dock Area (Subject to License Agreement)
Air rights between mean sea level elevations 271.03 and 290.32 for excepted premises as
described below:
An area lying in Lots 2 & 3 of Fractional Block 80 of the Original City of Little Rock, Pulaski
County, Arkansas, being more particularly described as follows:
Commencing at the Southeast corner of said block 79; thence North 89 degrees 43 minutes 52
seconds West along the North right of way line of West Markham Street 434.03 feet; thence
North 00 degrees 16 minutes 08 seconds East, 178.98 feet to a point of beginning; thence
westerly a distance of 9.48 feet to a point; thence N 45 degrees 00 minutes 00 seconds E a
distance of 0.84 feet to a point; thence N 45 degrees 00 minutes 00 seconds W a distance of 6.05
feet to a point; thence S 45 degrees 00 minutes 00 seconds W a distance of 1.01 feet to a point;
thence N 45 degrees 00 minutes 00 seconds W a distance of 3.67 feet to a point; thence S 45
degrees 00 minutes 00 seconds W a distance of 9.39 feet to a point; thence N 89 degrees 43
minutes 52 seconds W a distance of 22.34 feet to a point; thence N 00 degrees 16 minutes 08
seconds East a distance of 98.15 feet to a point; thence easterly a distance of 45.00 feet to a
point; thence S 00 degrees 02 minutes 54 seconds E a distance of 98.36 feet to the point of
beginning.
Parcel No. 32: Markham Level Entrance Drive (Subject to License Agreement)
An area located in the Southeast 1/4, Northeast %, Section 3, Township 1 N, Range 12 W, Pulaski
County, Arkansas more particularly described as follows:
Commencing at the Southeast corner of Block 79 of the Original City of Little Rock; thence N
89°43'52" W along the North line of Markham Street a distance of 255.35' to the point of
beginning; thence North a distance of 17.44' to a point; thence S 89°43'52" E a distance of
131.08' to a point of curvature; thence along a curve to the right (R= 15.50') an arc distance of
9.41' to a point; thence S 53°46'26" E a distance of 23.91' to the North line of Markham Street;
thence along said North line N 89°43'52" W a distance of 159.32' to the point of beginning.
All as shown in that certain survey prepared by McCaskill & Associates, Inc. dated February 21,
2013.
LESS AND EXCEPT FROM ANY AND ALL OF THE ABOVE PARCELS, the Demised
Premises;
Together with any and all other parts of the Convention Center currently existing, and any
additions thereto in the future, including without limitation, all that part of the Convention Center
lying east of Parcel 16, Convention Center Tract 1 and Parcel 20, North Main Street Franchise
Tract and bounded, generally, by Markham Street on the South, LaHarpe Boulevard on the North
and the south ramp of the Main Street Bridge on the East within which is located Parcel 23
which is a part of the Demised Premises.
C-5
EXHIBIT "D"
ASSIGNMENT, ASSUMPTION, AND FIRST
AMENDMENT TO PARKING LOT LEASE
AGREEMENTS AND REAFFIRMATION AND
EXTENSION OF ASHLEY STREET
PARKING FRANCHISE
1160171-v1
EXHIBIT "D"
Form of Assignment, Assumption, and First Amendment to Parking Lot Lease Agreements
and Reaffirmation and Extension of Ashley Street Parking Franchise
Prepared By and Return To:
Sumpter M.McGowin II,Esq.
Wyatt,Tarrant&Combs,LLP
1715 Aaron Brenner Drive,Suite 800
Memphis,Tennessee 38120
(901)537-1000
ASSIGNMENT, ASSUMPTION, AND FIRST AMENDMENT TO
PARK NG LOT LEASE AGREEMENTS AND REAFFIRMATION AND EXTENSION
OF ASHLEY STREET PARKING FRANCHISE
This Assignment, Assumption, and First Amendment to Parking Lot Lease Agreements
and Reaffirmation And Extension of Ashley Street Parking Franchise (the "Agreement") is
entered into as of this day of February, 2013, by and among FWH II Little Rock, LLC, a
Delaware limited liability company("Lessee"), the City of Little Rock, a municipal corporation
organized and existing under and by virtue of the laws of the State of Arkansas acting by and
through its agent, the City Advertising and Promotion Commission of Little Rock, Arkansas
("Lessor"), and BG Excelsior Limited Partnership, an Arkansas limited partnership ("BGE").
RECITALS
WHEREAS, Lessor and BGE are parties to that certain Parking Lease Agreement, as
amended, dated the 16th day of September, 1988, which was assigned to BGE pursuant to that
Assignment of Parking Lease filed in the Official Records of Pulaski County, Arkansas (the
"Filing Office") on October 3, 2000, at Instrument Number 2000070054 (the "Block 99 Lease")
pursuant to which Lessor has leased to BGE 50 parking spaces in the lots described in Exhibit A
attached hereto;
WHEREAS, Lessor and BGE are parties to that certain Parking Lot Lease Agreement
(E1/2 of Block 3 Original City), as amended, dated the 1st day of April, 1998, which was assigned
to BGE pursuant to that Assignment of Parking Lease filed in the Filing Office on October 3,
2000, at Instrument Number 2000070054 (the "E1/2 of Block 3 Lease") and pursuant to which
Lessor has leased to BGE certain parking facilities described more fully in Exhibit B attached
hereto;
WHEREAS, Lessor and BGE are parties to that certain Agreement to Rent Parking
Spaces in the 2nd and Main Deck, as amended, dated the 1st day of April, 1998, which was
assigned to BGE pursuant to that Assignment of Parking Lease filed in the Filing Office on
October 3, 2000, at Instrument Number 2000070054 (the "2nd and Main Deck Parking Lease"
and, together with the Block 99 Lease and the E1/2 of Block 3 Lease, the"Parking Leases") and
pursuant to which Lessor has leased to BGE 100 parking spaces in the lots described more fully
in Exhibit C attached hereto (collectively, the"Demised Premises");
D-1
WHEREAS, the Lessor and BGE, are parties to that certain Amended, Restated, and
Substituted Lease and Concession Agreement dated September 18, 2000, as amended by that
certain First Amendment to Amended, Restated, and Substituted Lease and Concession
Agreement dated May 16, 2001, and by that certain Second Amendment to Amended, Restated,
and Substituted Lease and Concession Agreement dated October 1, 2002 (collectively, the
"Prior Hotel Lease");
WHEREAS, Lessee, URCO, Inc., a Tennessee corporation, and BGE are parties to that
certain Purchase and Sale Agreement dated 25th day of June, 2012, (the "Purchase Agreement"),
as amended, pursuant to which Lessee will purchase the leasehold interest represented by the
Prior Hotel Lease from BGE;
WHEREAS, in connection with the execution of the Purchase Agreement, Lessor has
terminated the Prior Hotel Lease and Lessor and Lessee have entered into that certain Lease and
Concession Agreement dated day of February, 2013 (the"Hotel Lease");
WHEREAS, in connection with the execution of the Purchase Agreement and the Hotel
Lease, BGE wishes to assign the Parking Leases, Lessee wishes to assume the Parking Leases,
and Lessor wishes to give certain assurances to Lessee with regard to BGE's performance of its
obligations under the Parking Leases;
WHEREAS, Lessor adopted Ordinance No. 18,286 on June 6, 2000, which Ordinance
was recorded in the Filing Office on August 24, 2000, at Instrument No. 2000059888
("Ordinance No. 18,286"), as amended by Ordinance No. 20,690, adopted by the City on January
22, 2013 and recorded in the Filing Office on January 24, 2013, at Instrument No. 2013006955
("Ordinance No. 20,690," and together with Ordinance No. 18,286, the "Ordinance"), pursuant
to which Lessor has granted to BGE an exclusive franchise"in and to the right-of-way of Ashley
Street laying between the eastern and western portions of Block 80, Original City of Little Rock,
Pulaski County, Arkansas, as configured on the date of the grant of[the] franchise," (the"Ashley
Street Parking Lot") as more particularly described in Exhibit D attached hereto, "for the
exclusive use of the surface of Ashley Street, including the right to control access to said street
for any purpose whatsoever, subject to Grantor's right to access said street for police, fire and
governmental purposes, and the right of access as needed by any utilities for which a valid and
enforceable franchise with the City is in place" (the"Franchise");
WHEREAS, in connection with the Lessor and Lessee entering into the Hotel Lease and
the assumption by the Lessee of the Parking Leases, the Lessor wishes to reaffirm and extend to
Lessee the benefits granted pursuant to the Ordinance with respect to the Franchise;
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants contained herein, the sufficiency of which are hereby acknowledged, the parties
hereby agree as follows.
1. Estoppel.
A. Lessor hereby represents and warrants that:
D-2
[1] Lessor is the lessor under the Parking Leases, and, as of the date
hereof, the Parking Leases are valid and in full force and effect without
modification or amendment (except as noted above) and are enforceable against
Lessor in accordance with their respective terms. Lessor is the owner of fee
simple title to the Demised Premises;
[2] the Parking Leases, respectively and together, embody the entire
agreement between Lessor and BGE with respect to the use and occupancy of the
Demised Premises. There are no other agreements or understandings between
Lessor and BGE with regard to the use or occupancy of the Demised Premises;
[3] BGE has no monetary obligation to Lessor in respect to the use and
occupancy of the Demised Premises, except for the rents specifically set forth in
the Parking Leases. BGE is current in the payment of all rentals due and payable
under the Parking Leases;
[4] there have been and are no defaults under the terms and conditions
of the Parking Leases by either Lessor or BGE and there are no events which have
occurred which, with the giving of notice or the passage of time, or both, would
constitute a default by either Lessor or BGE thereunder;
[5] the Demised Premises are not subject to any other lease, contract,
bill of assurance or other agreement that would in any way prevent or restrict
Lessee's full access to the Demised Premises; and
[6] Lessor is the grantor of the Franchise approved pursuant to the
Ordinance, the Franchise is in full force and effect and has not been repealed,
revoked or otherwise amended since the date of the Lessor's adoption of
Ordinance No. 20,690. The Lessor is the owner of fee simple title to the Ashley
Street Parking Lot. .
B. BGE hereby represents and warrants that:
[1] BGE is the lessee under the Parking Leases, and, as of the date
hereof, the Parking Leases are valid and in full force and effect without
modification or amendment (except as noted above) and are enforceable against
Lessee in accordance with their respective terms;
[2] the Parking Leases, respectively and together, embody the entire
agreement between Lessor and BGE with respect to the use and occupancy of the
Demised Premises. There are no other agreements or understandings between
Lessor and BGE with regard to the use or occupancy of the Demised Premises;
[3] BGE has no monetary obligation to Lessor in respect to the use and
occupancy of the Demised Premises, except for the rents specifically set forth in
the Parking Leases. BGE is current in the payment of all rentals due and payable
under the Parking Leases;
D-3
[4J there have been and are no defaults under the terms and conditions
of the Parking Leases by either Lessor or BGE and there are no events which have
occurred which, with the giving of notice or the passage of time, or both, would
constitute a default by either Lessor or BGE thereunder; and
[5] BGE is the grantee of the Franchise and has fully complied with
and is not in default of, its obligations thereunder, nor has BGE received notice of
the existence of a default under the Franchise or of Lessor's intention to revoke,
repeal or otherwise modify the terms of the Ordinance.
2. Assignment and Assumption.
A. BGE hereby assigns all of its right, title and interest in and to the
Parking Leases to Lessee and Lessee hereby assumes such right, title and interest to the
Parking Leases and agrees to be bound by all the terms and conditions of the Parking Leases.
B. Lessor hereby consents to such assignment and hereby releases BGE
from all obligations under the Parking Leases.
3. Amendment of Parking Leases. The provisions of each Parking Lease are
hereby amended and superseded to the extent of any conflict therewith, as follows:
A. CANCELLATION. "In addition to any other right to cancel the Parking
Leases, Lessee shall have the right to cancel a Parking Lease or any of the Parking
Leases, immediately upon the delivery of written notice to the Lessor in the event
of the termination for any reason of that certain Lease and Concession Agreement
dated day of February, 2013, as amended (the "Hotel Lease") to which
Lessee is a party."
B. RENEWAL.
"So long as the Lessee is not in default under the terms of the Parking Leases, or
any one of the Parking Leases, Lessor grants to Lessee the right, privilege and option to
extend the Parking Leases in successive periods of three (3) years each for so long as the
Lessee is a party to the Hotel Lease, upon and subject to the terms, provisions and
conditions of this Agreement."
C. USE, ALTERATIONS AND TITLE TO IMPROVEMENTS. The words
"Excelsior Hotel" shall be deleted and replaced with the words "Marriott or other full-
service hotel described in the Hotel Lease," wherever such term shall appear in any of the
Parking Leases.
D. ASSIGNMENT. "The Parking Leases shall be assignable by the Lessee
without the consent of the Lessor to any assignee or other successor in interest of the
Lessee with respect to the Hotel Lease."
4. Reaffirmation and Extension of Franchise. Lessor, as grantor of the Franchise
pursuant to the Ordinance, hereby reaffirms the grant of and extends to Lessee the exclusive
D-4
Franchise, and further agrees as requested by Lessee, to adopt such amendatory ordinance or
ordinances confirming such reaffirmation and extension for the benefit of Lessee or its
successors and assigns. In addition, Lessor hereby further agrees as follows:
A. the Franchise shall expire on the date the Hotel Lease expires or is sooner
terminated as provided therein;
B. this Agreement, and any ordinance amending the Ordinance, shall benefit and
extend in favor of Lessee, and its successors and assigns, in accordance with the terms
and provisions of the Hotel Lease; and
C. notwithstanding the foregoing provisions, the Board of Directors of the Lessor
reserves to itself the right to exercise any and all legislative authority with respect to the
Ordinance and any ordinances amendatory thereto.
5. Miscellaneous. The provisions of this Agreement may not be modified or
terminated orally, and shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, including any subsequent owner of the Demised
Premises. The provisions of this Agreement shall run with the land.
6. Governing Law. This Agreement shall be construed, interpreted, enforced and
governed by and in accordance with the laws of the State of Arkansas.
7. Execution in Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which counterparts taken
together shall constitute but one and the same instrument.
[SIGNATURE PAGE TO FOLLOW]
D-5
f
[COUNTERPART SIGNATURE PAGE TO ASSIGNMENT, ASSUMPTION, AND
FIRST AMENDMENT TO PARKING LOT LEASE AGREEMENTS AND
REAFFIRMATION AND EXTENSION OF ASHLEY STREET PARKING FRANCHISE]
IN WITNESS HEREOF, the parties execute this Agreement as of the date first above
written.
BG EXCELSIOR
LIMITED PARTNERSHIP
By: BEX, INC., its general partner
By:
Name:
Title:
D-6
ACKNOWLEDGEMENT
STATE OF
COUNTY OF
Before me, the undersigned, a Notary Public, duly commissioned, qualified and acting
within and for said County and State, appeared in person the within named
, to me personally known, who stated that he was
the of BEX, Inc., the general partner of BG Excelsior Limited
Partnership, a Tennessee limited partnership, and is duly authorized in his capacity to execute the
foregoing instrument for and in the name and behalf of said limited partnership; and he further
stated and acknowledged that he had so signed, executed and delivered the foregoing instrument
for the consideration,uses and purposes therein mentioned and set forth.
WITNESS my hand and official seal, this the day of February, 2013.
Notary Public
My commission expires:
D-7
[COUNTERPART SIGNATURE PAGE TO ASSIGNMENT, ASSUMPTION, AND
FIRST AMENDMENT TO PARKING LOT LEASE AGREEMENTS AND
REAFFIRMATION AND EXTENSION OF ASHLEY STREET PARKING FRANCHISE]
IN WITNESS HEREOF, the parties execute this Agreement as of the date first above
written.
FWH II LITTLE ROCK, LLC, a Delaware
limited liability company:
By: Fairwood Hospitality Investors II, L.L.C., its
member
By: Fairwood Investors II, LLC, its manager
By:
Robert M. Solmson, President
D-8
1
ACKNOWLEDGEMENT
STATE OF
COUNTY OF
Before me, the undersigned, a Notary Public, duly commissioned, qualified and acting
within and for said County and State, appeared in person the within named
, to me personally known, who stated that he was
the of Fairwood Investors, LLC, a Delaware limited liability company
and the manager of Fairwood Hospitality Investors II, L.L.C., a Delaware limited liability
company and the sole member of FWH II Little Rock, LLC, a Delaware limited liability
company, and is duly authorized in his capacity to execute the foregoing instrument for and in
the name and behalf of said limited liability company; and he further stated and acknowledged
that he had so signed, executed and delivered the foregoing instrument for the consideration, uses
and purposes therein mentioned and set forth.
WITNESS my hand and official seal, this the day of February, 2013.
Notary Public
My commission expires:
D-9
[COUNTERPART SIGNATURE PAGE TO ASSIGNMENT, ASSUMPTION,AND
FIRST AMENDMENT TO PARKING LOT LEASE AGREEMENTS AND
REAFFIRMATION AND EXTENSION OF ASHLEY STREET PARKING FRANCHISE]
IN WITNESS HEREOF, the parties execute this Agreement as of the date first above
written.
CITY OF LITTLE ROCK
By:
Mark Stodola, Mayor
ATTEST:
By:
Susan Langley, City Clerk
D-10
ACKNOWLEDGEMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day before me, the undersigned being a Notary Public of and for the County and
State aforesaid, personally appeared Mark Stodola and Susan Langley, who acknowledged
themselves to be the Mayor and City Clerk, respectively, of the City of Little Rock, Arkansas, a
city of the first class, and that they, as such officers, being authorized so to do, executed the
foregoing instrument for the consideration, uses and purposes therein contained, by signing the
name of the city of first class by themselves as such officers.
WITNESS My hand and official seal on this day of February, 2013.
Notary Public
My commission expires:
D-11
[COUNTERPART SIGNATURE PAGE TO ASSIGNMENT, ASSUMPTION, AND
FIRST AMENDMENT TO PARKING LOT LEASE AGREEMENTS AND
REAFFIRMATION AND EXTENSION OF ASHLEY STREET PARKING FRANCHISE]
IN WITNESS HEREOF, the parties execute this Agreement as of the date first above
written.
EXECUTED FOR CERTAIN
PURPOSES AS AGENT:
LITTLE ROCK ADVERTISING AND
PROMOTION COMMISSION
BY:
WARREN SIMPSON, CHAIRMAN
D-12
ACKNOWLEDGEMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day before me, the undersigned being a Notary Public of and for the County and
State aforesaid, personally appeared Warren Simpson, who acknowledged himself to be the
Chairman of the Little Rock Advertising and Promotion Commission, and that he, as such
officer, being authorized so to do, executed the foregoing instrument for the consideration, uses
and purposes therein contained, by signing the name of the commission by himself as such
officer.
WITNESS My hand and official seal on this day of February, 2013.
Notary Public
My commission expires:
D-13
EXHIBIT A
Lots 7, 8 and 9 inclusive, Block 99, Original City of Little Rock, Pulaski County, Arkansas and
Lots 1 through 12 inclusive, Block 100, original City of Little Rock Pulaski County, Arkansas
and the East-West Alleys located within Blocks 99 and 100, original City of Little Rock, Pulaski
County, Arkansas and Spring Street between the North right-of-way of Markham Street extended
and the South right-of-way line of Garland Street extended, all as provided on the plat for
Original City of Little Rock as recorded in Pulaski County records in Book "L" at Pages 330 and
331 and as vacated by Ordinance No. 12,471, recorded April 21, 1971 in Book 1143, Page 403.
Lots 4, 5 and 6 inclusive, Block 99, Original City of Little Rock, Pulaski County, Arkansas.
(Now known as Vinson Plaza.)
D-14
/--
EXHIBIT B
Lots 1 through 6 inclusive, Block 3, Original City of Little Rock, Pulaski County, Arkansas and
the West half of an alley located in Block 3 lying easterly of Lots 1 through 6 inclusive, now
closed by Ordinance No. 12,163, of record in Book 1057, Page 403, records of Pulaski County,
Arkansas.
•
D-15
EXHIBIT C
Lots 7 through 12 inclusive, Block 3, Original City of Little Rock, Pulaski County, Arkansas and
the East half of an alley located in Block 3 lying westerly of Lots 7 through 12 inclusive, now
closed by Ordinance No. 12,163, of record in Book 1057, Page 403, records of Pulaski County,
Arkansas. Less and except a strip conveyed to the City of Little Rock, for the purpose of a public
street and the installation and maintenance of public utilities and other public purposes, described
as: a tract of land being a part of Block 3, Original City of Little Rock, Arkansas, being more
particularly described as follows: Beginning at a found 1/2" rebar at the Southeast corner of said
Block 3; thence North 80 degrees 26 minutes 19 seconds West along the North right of way line
of East 3rd Street, 22.68 feet; thence along a curve to the left having a 20 foot radius and a chord
bearing and distance of North 54 degrees 35 minutes 20 East, 28.27 feet for a distance of 31.4
feet; thence North 9 degrees 37 minutes 00 seconds East, 261.33 feet to a tangent curve to the
left; thence along said curve to the left having a radius of 20.00 feet, and a chord bearing and
distance of North 35 degrees 16 minutes 17 seconds West for a distance of 28.23 feet to the
South right of way line of East 2nd street; thence South 80 degrees 09 minutes 34 seconds East,
along said South right of way line, 22.62 feet to a found "X" at the Northeast corner of said
Block 3; thence South 9 degrees 37 minutes 00 seconds West, along the East line of said Block
3, for a distance of 301.22 feet to the Point of Beginning.
D-16
EXHIBIT D
A tract of land located in the Southeast 1/4, Northeast 1/4, Section 3, Township 1 North, Range
12 West, Pulaski County, Arkansas, said tract being West of Fractional Block 80, Original City
of Little Rock and being more particularly described as follows:
Beginning at a found 1/2 inch rebar at the intersection of the North right of way line of West
Markham Street and the East right of way line of Ashley Street, said point being 2.00 feet North
89 degrees 40 minutes 23 seconds West, of the Original Southwest corner of said Fractional
Block 80; thence North 00 degrees 12 minutes 36 seconds East, 300.05 feet along said East right
of way line of Ashley Street to a found "X" in concrete being the intersection of the East right of
way line of Ashley Street and the South right of way line of La Harpe Boulevard; thence North
89 degrees 18 minutes 24 seconds West, 57.73 feet along said South right of way line of La
Harpe Boulevard to a found "X" on a concrete retaining wall being the intersection of the South
right of way line of La Harpe Boulevard and the West right of way line of Ashley Street; thence
South 00 degrees 12 minutes 36 seconds West, 300.42 feet along said West right of way line of
Ashley Street to the point of intersection of said West right of way line of Ashley Street and the
North right of way line of West Markham Street; thence South 89 degrees 40minutes 23 seconds
East, 57.73 feet along said North right of way line of West Markham Street to the Point of
Beginning.
D-17
r
EXHIBIT "E"
ESTOPPEL STATEMENT FROM LESSOR AND
LESSOR'S FORMER LESSEE REGARDING
DEMISED PREMISES
EXHIBIT "E"
Form of Estoppel Statement from Lessor and Lessor's Former Lessee Regarding Demised
Premises
ESTOPPEL CERTIFICATE AND TERMINATION OF LEASE
This Estoppel Certificate and Termination of Lease (the "Certificate") is made this
day of February, 2013 by and among the City of Little Rock, a municipal corporation organized
under and existing by virtue of the laws of the State of Arkansas (the "City"), the City
Advertising and Promotion Commission of Little Rock, Arkansas, as agent of the City (the
"Commission," or, together with the City, the "Lessor") and BG Excelsior Limited Partnership,
an Arkansas limited partnership ("BGE") for the benefit of FWH II Little Rock, LLC, a
Delaware limited liability company("FWH").
RECITALS
WHEREAS, the Lessor and BGE are parties to that certain Amended, Restated, and
Substituted Lease and Concession Agreement dated September 18, 2000, as amended by that
certain First Amendment to Amended, Restated, and Substituted Lease and Concession
Agreement dated May 16, 2001, and by that certain Second Amendment to Amended, Restated,
and Substituted Lease and Concession Agreement dated October 1, 2002 (collectively, the
"Lease");
WHEREAS, FWH, URCO, Inc., a Tennessee corporation, and BGE are parties to that
certain Purchase and Sale Agreement dated June 25, 2012, as amended (the "Purchase
Agreement"), pursuant to which FWH will purchase the leasehold interest represented by the
Lease from BGE;
WHEREAS, the City has consented to the sale of such leasehold interest to FWH and
has agreed to terminate the Lease and enter into that certain Lease and Concession Agreement
(the "New Lease") with FWH immediately upon and simultaneously with the closing of the
Purchase Agreement and consummation of the transfer contemplated thereby;
WHEREAS, in consideration of the foregoing, the Lessor and BGE wish to terminate the
Lease, with such termination being effective immediately prior to the effective date of the New
Lease; and
WHEREAS, as required by the terms of the New Lease and as an inducement for FWH
to enter into such New Lease, the City and BGE wish to give certain assurances to FWH
regarding their respective performance of the terms and conditions of the Lease.
NOW, THEREFORE, the Lessor and BGE acknowledge and recognize that FWH will
rely upon the statements and certifications made herein as a material inducement to purchase the
leasehold interest represented by the Lease and to enter into the New Lease with the Lessor and
hereby represent, warrant and certify the following:
E-1
fes_
1. Termination of Lease. Lessor and BGE hereby agree that the Lease will be
terminated along with all rights and obligations of all parties thereto as of the moment
immediately prior to the effective date and time of the New Lease, except that Lessor shall
remain obligated to pay any remaining and unpaid Enhancement Maintenance Payment, as that
term is defined in the Lease, owed to BGE under the Lease, including the final such
Enhancement Maintenance Payment which is due and payable to BGE on or before March 15,
2013.
2. Estoppel Certificate.
A. As of the date hereof, the Lessor hereby acknowledges, represents,
warrants, and certifies the following to FWH:
[1] Lessor is the lessor under the Lease, and, as of the date hereof, the
Lease is valid and in full force and effect without modification or amendment and is
enforceable against Lessor in accordance with its terms. Lessor is the owner of fee
simple title to the real property underlying the Demised Premises;
[2] the Lease embodies the entire agreement between Lessor and BGE
with respect to the use and occupancy of the Demised Premises. There are no other
agreements or understandings between Lessor and BGE with regard to the use or
occupancy of the Demised Premises;
[3] BGE has no monetary obligation to Lessor in respect to the use and
occupancy of the Demised Premises, except for the rents specifically set forth in the
Lease. BGE is current in the payment of all rentals due and payable under the Lease
through March 31, 2013; and
[4] there have been and are no defaults under the terms and conditions
of the Lease by either Lessor or BGE and there are no events which have occurred which,
with the giving of notice or the passage of time, or both, would constitute a default by
either Lessor or BGE thereunder.
B As of the date hereof, the BGE hereby acknowledges, represents, warrants,
and certifies the following to FWH:
[1] BGE is the lessee under the Lease, and, as of the date hereof, the
Lease is valid and in full force and effect without modification or amendment and is
enforceable against BGE in accordance with its terms;
[2] the Lease embodies the entire agreement between Lessor and BGE
with respect to the use and occupancy of the Demised Premises. There are no other
agreements or understandings between Lessor and BGE with regard to the use or
occupancy of the Demised Premises;
E-2
3 BGE has no monetary] obligation to Lessor in respect to the use and
occupancy of the Demised Premises, except for the rents specifically set forth in the
Lease. BGE is current in the payment of all rentals due and payable under the Lease
through March 31, 2013; and
[4] there have been and are no defaults under the terms and conditions
of the Lease by either Lessor or BGE and there are no events which have occurred which,
with the giving of notice or the passage of time, or both, would constitute a default by
either Lessor or BGE thereunder.
3. Entire Agreement. This Certificate supercedes all prior representations,
warranties, and certifications with respect to the subject matter set forth in Section 2 hereof and
any prior or contemporaneous agreement, promise, or representation, whether oral or written,
relating to the subject matter of this Certificate and not expressly set forth or referenced in this
Certificate or a proper amendment hereto shall be of no force or effect.
4. Amendment. This Certificate may be amended only by the mutual written
consent of the parties, and no oral modification or amendment shall be permitted or binding on
the parties.
5. Binding Effect. This Certificate shall be binding upon and shall inure to the
benefit of the respective parties hereto and their successors and permitted assigns.
6. Severability. In the event that any provision of this Certificate is rendered invalid
or unenforceable, such provision shall be severed from this Certificate and the remaining
provisions of this Certificate shall continue in full force and effect.
7. Governing Law. This Certificate shall be governed by and construed in
accordance with the law of the State of Arkansas.
8. Counterparts. This Certificate may be executed in any number of counterparts,
each of which shall be deemed to be an original. Signatures exchanged by electronic means shall
be enforceable as if they were originals.
[Signature Page to Follow]
E-3
[SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
IN WITNESS HEREOF, the below parties execute this Certificate as of the date first
above written.
CITY OF LITTLE ROCK
By:
Name:
Title:
EXECUTED FOR CERTAIN PURPOSES AS
AGENT:
LITTLE ROCK ADVERTISING AND
PROMOTION COMMISSION
BY:
WARREN SIMPSON, CHAIRMAN
FWH II LITTLE ROCK, LLC
By: FAIRWOOD HOSPITALITY
INVESTORS II, L.L.C., its Member
By: FAIRWOOD INVESTORS II, LLC,
its Manager
By:
Name:
Title:
E-4
[SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
IN WITNESS HEREOF, the below parties execute this Certificate as of the date first
above written.
BG EXCELSIOR LIMITED PARTNERSHIP
By: BEX, INC., its general partner
By:
Name:
Title:
E-5
EXHIBIT "F"
ESTOPPEL STATEMENT REGARDING HAZARDOUS
OR OTHER ADVERSE CONDITIONS OF
DEMISED PREMISES
EXHIBIT "F"
Form of Estoppel Statement regarding hazardous or other adverse conditions of Demised
Premises
ENVIRONMENTAL ESTOPPEL CERTIFICATE
This Environmental Estoppel Certificate (the "Certificate") is entered into by the City of
Little Rock, Arkansas (the "City"), a municipal corporation organized under and existing by
virtue of the laws of the State of Arkansas, acting by duly adopted resolution and the City
Advertising and Promotion Commission of Little Rock, Arkansas (the "Commission"), as agent
of and for the City of Little Rock, acting by duly adopted resolution, (the City and the
Commission being hereinafter referred to collectively as the "Lessor") for the benefit of FWH II
Little Rock, LLC, a Delaware limited liability company("FWH").
RECITALS
WHEREAS, FWH and the Lessor are both parties to that certain Lease and Concession
Agreement dated_day of February, 2013 (the "New Lease"); and
WHEREAS, pursuant to the terms of the Lease and as an inducement to FWH to enter
into the Lease, Lessor wishes to make certain assurances to FWH regarding its compliance with
Environmental Laws.
NOW, THEREFORE, Lessor acknowledges and recognizes that FWH will rely upon
the statements and certifications made herein as a material inducement to enter into the New
Lease with the Lessor, and Lessor hereby represents, warrants and certifies as follows:
1. Environmental Representations and Warranties. To the best of its knowledge:
(a) there are no Hazardous Substances or underground storage tanks in, on, or under the Demised
Premises or the Excepted Premises, as such terms are defined in the Lease, except those that are
both (i) in compliance with Environmental Laws and, if required, with permits issued pursuant
thereto and (ii) fully disclosed to FWH in writing; (b) there are no past, present or threatened
Releases of Hazardous Substances in, on, under or from the Demised Premises or the Excepted
Premises; (c) there is no threat of any Release of Hazardous Substances migrating to the
Demised Premises or the Excepted Premises; (d) there is no past or present non-compliance with
Environmental Laws, or with permits issued pursuant thereto, in connection with the Demised
Premises or the Excepted Premises; (e) Lessor does not know of, and has not received, any
written or oral notice or other communication from any Person relating to Hazardous Substances
or Remediation thereof, any possible liability of any Person pursuant to any Environmental Law,
or any other environmental conditions in connection with the Demised Premises or the Excepted
Premises, or any actual or potential administrative or judicial proceedings in connection with any
of the foregoing; and (f) Lessor has truthfully and fully provided to FWH, in writing, any and all
information relating to conditions in, on, under or from the Demised Premises or the Excepted
Premises that is known to the Lessor and that is contained in files and records of the Lessor,
including, without limitation, any reports relating to Hazardous Substances in, on, under or from
F-1
the Demised Premises or the Excepted Premises and/or to the environmental condition of the
Demised Premises or the Excepted Premises.
2. Definitions.
A. `Environmental Law" means any federal, state and local laws, statutes,
ordinances, rules, regulations and the like, as well as common law, relating to protection of
human health or the environment, relating to Hazardous Substances, relating to liability for or
costs of Remediation or prevention of Releases of Hazardous Substances or relating to liability
for or costs of other actual or threatened danger to human health or the environment.
"Environmental Law" includes, but is not limited to, the following statutes, as amended, any
successor thereto, and any regulations promulgated pursuant thereto, and any state or local
statutes, ordinances, rules, regulations and the like addressing similar issues: the Comprehensive
Environmental Response, Compensation and Liability Act; the Emergency Planning and
Community Right-to-Know Act; the Hazardous Substances Transportation Act; the Resource
Conservation and Recovery Act (including, without limitation, Subtitle I relating to underground
storage tanks); the Solid Waste Disposal Act; the Clean Water Act; the Clean Air Act; the Toxic
Substances Control Act; the Safe Drinking Water Act; the Occupational Safety and Health Act;
the Federal Water Pollution Control Act; the Federal Insecticide, Fungicide and Rodenticide Act;
the Endangered Species Act; the National Environmental Policy Act; the River and Harbors
Appropriation Act and the Residential Lead-Based Paint Hazard Reduction Act. "Environmental
Law" also includes, but is not limited to, any federal, state and local laws, statutes, ordinances,
rules, regulations and the like, as well as common law: conditioning transfer of property upon a
negative declaration or other approval of a governmental authority of the environmental
condition of the property; requiring notification or disclosure of Releases of Hazardous
Substances or other environmental condition of the Demised Premises or the Excepted Premises
to any governmental authority or other Person, whether or not in connection with transfer of title
to or interest in property; imposing conditions or requirements in connection with permits or
other authorization for lawful activity; relating to nuisance, trespass or other causes of action
related to the Demised Premises or the Excepted Premises; and relating to wrongful death,
personal injury, or property or other damage in connection with any physical condition or use of
the Demised Premises or the Excepted Premises.
B. "Hazardous Substances" includes but is not limited to any and all
substances (whether solid, liquid or gas) defined, listed, or otherwise classified as pollutants,
hazardous wastes, hazardous substances, hazardous materials, extremely hazardous wastes, or
words of similar meaning or regulatory effect under any present Environmental Laws or that may
have a negative impact on human health or the environment, including, without limitation,
petroleum and petroleum products, asbestos and asbestos-containing materials, polychlorinated
biphenyls, lead, materials containing lead-based paint, radon, radioactive materials, flammables
and explosives.
C. "Person" means any natural person, firm, partnership, corporation or any
other entity.
F-2
D. "Release" with respect to any Hazardous Substance includes but is not
limited to any release, deposit, discharge, emission, leaking, spilling, seeping, migrating,
injecting, pumping, pouring, emptying, escaping, dumping, disposing or other movement of
Hazardous Substances.
E. "Remediation" includes but is not limited to any response, remedial,
removal, or corrective action, any activity to cleanup, detoxify, decontaminate, contain or
otherwise remediate any Hazardous Substance, any actions to prevent, cure or mitigate any
Release of any Hazardous Substance, any action to comply with any Environmental Laws or
with any permits issued pursuant thereto, any inspection, investigation, study, monitoring,
assessment, audit, sampling and testing, laboratory or other analysis, or evaluation relating to any
Hazardous Substances or to anything referred to herein.
3. Entire Agreement. This Certificate supercedes all prior representations,
warranties, and certifications with respect to the subject matter set forth in Section 1 hereof and
any prior or contemporaneous agreement, promise, or representation, whether oral or written,
relating to the subject matter of this Certificate and not expressly set forth or referenced in this
Certificate or a proper amendment hereto shall be of no force or effect.
4. Amendment. This Certificate may be amended only by the mutual written
consent of the parties, and no oral modification or amendment shall be permitted or binding on
the parties.
5. Binding Effect. This Certificate shall be binding upon and shall inure to the
benefit of the respective parties hereto and their successors and permitted assigns.
6. Severability. In the event that any provision of this Certificate is rendered invalid
or unenforceable, such provision shall be severed from this Certificate and the remaining
provisions of this Certificate shall continue in full force and effect.
7. Governing Law. This Certificate shall be governed by and construed in
accordance with the law of the State of Arkansas.
8. Counterparts. This Certificate may be executed in any number of counterparts,
each of which shall be deemed to be an original. Signatures exchanged by electronic means shall
be enforceable as if they were originals.
[Signature Page to Follow]
F-3
C
EXHIBIT "G"
PROPERTY ALONG RIVER BANK AND PARKING LOT
RESTRICTIVE COVENANTS PARCEL
EXHIBIT "G"
Restricted Area
Riverfront Park Restricted Area
An area located in the Southeast 'A, Northeast 'A, Section 3, Township 1 N, Range 12 W, Pulaski
County, Arkansas more particularly described as follows:
Commencing at a point being the Southwest corner of Block 182 of the Original City of Little
Rock; thence West a distance of 60.00' to a point; thence N 86°31'54" W a distance of 330.73'
to a point; thence N 87°08'30" W a distance of 268.43' to the point of beginning; thence N
87°08'30" W a distance of 15.27' to a point; thence North a distance of 7.10' to a point; thence
N 84°28'28"W a distance of 142.22' to a point; thence N 81°17'13"W a distance of 27.58' to a
point; thence N 80°46'00"W a distance of 64.16' to a point; thence N 80°49'32"W a distance of
2.40' to a point being the Southeast corner of the Convention Center Tract 2; thence N
00°12'36"E a distance of 80.00' to a point; thence N 44°47'24"W a distance of 99.39' to a point;
thence N 89°47'24"W a distance of 96.14' to a point; thence S 45°12'36"W a distance of 61.63'
to a point; thence S 00°12'36"W a distance of 74.35' to a point; thence S 86°27'00"W a distance
of 10.00' to a point; thence N85°18'09"W a distance of 248.26' to a point; thence N12°56'43"W
a distance of 11.00' to a point; thence N69°19'30"W a distance of 33.95' to a point; thence
N79°25'42"W a distance of 6.33' to a point; thence N71°30'21"W a distance of 25.08' to a
point; thence S 20°32'03"W a distance of 1.08' to a point; thence N 69°27'57"W a distance of
45.08' to a point; thence 70°12'20"W a distance of 118.87' to a point; thence N 70°45'52"W a
distance of 148.42' to a point; thence N 80°04'00"W a distance of 356.71' to a point in the East
line of the Broadway Street bridge; thence North 35.00' to a point at the High Water Line of the
Arkansas River; thence eastwardly along said High Water Line approximately 1575' +\- to the
West line of the Main Street bridge; thence South a distance of approximately 200' +\- to the
point of beginning.
ti
G-1
EXHIBIT "H"
PARKING LOT PARCEL - NEI/4 OF BLOCK 2,
CITY OF LITTLE ROCK RIGHT OF FIRST
REFUSAL PARCEL
EXHIBIT "H"
Parking: Right of First Refusal Lot
Parking: Right of First Refusal Tract
A tract of land located in the Southeast IA, Northeast IA, Section 3, Township 1 N, Range
12 W, Pulaski County, Arkansas said tract being Lots 11, 12 and the North 20' of Lot 10,
Block 2 all in the Original City of Little Rock, Pulaski County, Arkansas and more
particularly described as follows:
Beginning at the Northeast corner of Block 2 thence southward along the West line of
Scott Street a distance of 120.00' to a point; thence westwardly and parallel to the South
line of Markham Street a distance of 140.00' to a point in the West line of Lot 10; thence
northward and parallel to Scott Street a distance of 120.00' to the Northwest corner of
Lot 12; thence eastward along the South line of Markham Street a distance of 140.00' to
the point of beginning containing 0.39 acres more or less.
H-1
EXHIBIT B
Prepared by:
John William Spivey III
Wright,Lindsey&Jennings LLP
200 West Capitol Avenue,Suite 2300
Little Rock,Arkansas 72201
ESTOPPEL CERTIFICATE AND TERMINATION OF LEASE
This Estoppel Certificate and Termination of Lease (the "Certificate") is made this 28th
day of February, 2013 by and among the City of Little Rock, a municipal corporation organized
under and existing by virtue of the laws of the State of Arkansas (the "City"), the City
Advertising and Promotion Commission of Little Rock, Arkansas, as _agent of the City (the
"Commission," or, together with the City, the "Lessor") and BG Excelsior Limited Partnership,
an Arkansas limited partnership ("BGE") for the benefit of FWH II Little Rock, LLC, a
Delaware limited liability company ("FWH").
RECITALS
WHEREAS, the Lessor and BGE are parties to that certain Amended, Restated, and
Substituted Lease and Concession Agreement dated September 18, 2000, as amended by that
certain First Amendment to Amended, Restated, and Substituted Lease and Concession
Agreement dated May 16, 2001, and by that certain Second Amendment to Amended, Restated,
and Substituted Lease and Concession Agreement dated October 1, 2002, as reflected in that
certain Memorandum of Amended, Restated and Substituted Lease and Concession Agreement
recorded October 3, 2000 at Instrument No. 2000070053 in the Records of Pulaski County
Arkansas (collectively, the"Lease");
WHEREAS, FWH, URCO, Inc., a Tennessee corporation, and BGE are parties to that
certain Purchase and Sale Agreement dated June 25, 2012, as amended (the "Purchase
Agreement"), pursuant to which FWH will purchase the leasehold interest represented by the
Lease from BGE;
WHEREAS, the City has consented to the sale of such leasehold interest to FWH and-
has
ndhas agreed to terminate the Lease and enter into that certain Lease and Concession Agreement
(the "New Lease") with FWH immediately upon and simultaneously with the closing of the
Purchase Agreement and consummation of the transfer contemplated thereby;
1160308-v1
WHEREAS, in consideration of the foregoing, the Lessor and BGE wish to terminate the
Lease, with such termination being effective immediately prior to the effective date of the New
Lease; and
WHEREAS, as required by the terms of the New Lease and as an inducement for FWH
to enter into such New Lease, the City and BGE wish to give certain assurances to FWH
regarding their respective performance of the terms and conditions of the Lease.
NOW, THEREFORE, the Lessor and BGE acknowledge and recognize that FWH will
rely upon the statements and certifications made herein as a material inducement to purchase the
leasehold interest represented by the Lease and to enter into the New Lease with the Lessor and
hereby represent, warrant and certify the following:
1. Termination of Lease. Lessor and BGE hereby agree that the Lease will be
terminated along with all rights and obligations of all parties thereto as of the moment
immediately prior to the effective date and time of the New Lease, except that Lessor shall
remain obligated to pay any remaining and unpaid Enhancement Maintenance Payment, as that
term is defined in the Lease, owed to BGE under the Lease, including the final such
Enhancement Maintenance Payment which is due and payable to BGE on or before March 15,
2013.
2. Estoppel Certificate.
A. As of the date hereof, the Lessor hereby acknowledges, represents,
warrants, and certifies the following to FWH:
[1] Lessor is the lessor under the Lease, and, as of the date hereof, the
Lease is valid and in full force and effect without modification or amendment and
is enforceable against Lessor in accordance with its terms. Lessor is the owner of
fee simple title to the real property underlying the Demised Premises;
[2] the Lease embodies the entire agreement between Lessor and BGE
with respect to the use and occupancy of the Demised Premises. There are no
other agreements or understandings between Lessor and BGE with regard to the
use or occupancy of the Demised Premises;
[3] BGE has no monetary obligation to Lessor in respect to the use and
occupancy of the Demised Premises, except for the rents specifically set forth in
the Lease. BGE is current in the payment of all rentals due and payable under the
Lease through March 31, 2013; and
[4] there have been and are no defaults under the terms and conditions
of the Lease by either Lessor or BGE and there are no events which have occurred
which, with the giving of notice or the passage of time, or both, would constitute a
default by either Lessor or BGE thereunder.
2
1160308-v1
B. As of the date hereof, the BGE hereby acknowledges, represents, warrants,
and certifies the following to FWH:
[1] BGE is the lessee under the Lease, and, as of the date hereof, the
Lease is valid and in full force and effect without modification or amendment and
is enforceable against BGE in accordance with its terms;
[2] the Lease embodies the entire agreement between Lessor and BGE
with respect to the use and occupancy of the Demised Premises. There are no
other agreements or understandings between Lessor and BGE with regard to the
use or occupancy of the Demised Premises;
[3] BGE has no monetary obligation to Lessor in respect tothe useand
occupancy of the Demised Premises, except for the rents specifically set forth in
the Lease. BGE is current in the payment of all rentals due and payable under the
Lease through March 31, 2013; and
[4] there have been and are no defaults under the terms and conditions
of the Lease by either Lessor or BGE and there are no events which have occurred
which, with the giving of notice or the passage of time, or both, would constitute a
default by either Lessor or BGE thereunder.
3. Entire Agreement. This Certificate supercedes all prior representations,
warranties, and certifications with respect to the subject matter set forth in Section 2 hereof and
any prior or contemporaneous agreement, promise, or representation, whether oral or written,
relating to the subject matter of this Certificate and not expressly set forth or referenced in this
Certificate or a proper amendment hereto shall be of no force or effect.
4. Amendment. This Certificate may be amended only by the mutual written
consent of the parties, and no oral modification or amendment shall be permitted or binding on
the parties.
5. Binding Effect. This Certificate shall be binding upon and shall inure to the
benefit of the respective parties hereto and their successors and permitted assigns.
6. Severability. In the event that any provision of this Certificate is rendered invalid
or unenforceable, such provision shall be severed from this Certificate and the remaining
provisions of this Certificate shall continue in full force and effect.
7. Governing Law. This Certificate shall be governed by and construed in
accordance with the law of the State of Arkansas.
8. Counterparts. This Certificate may be executed in any number of counterparts,
each of which shall be deemed to be an original. Signatures exchanged by electronic means shall
be enforceable as if they were originals.
[Signature Page to Follow]
3
1160308-v1
[SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
IN WITNESS HEREOF, the below parties execute this Certificate as of the date first
above written.
CITY OF LITTLE ROCK
IS/4B
Name: alr -
Title: "46'7'
4
1160308-v1
I ACKNOWLEDGEMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day before me, the undersigned being a Notary Public of and for the County and
State aforesaid, personally appeared Mark Stodola, who acknowledged himself to be the Mayor
of the City of Little Rock, Arkansas, a city of the first class, and that he, as such officer, being
authorized so to do, executed the foregoing instrument for the consideration, uses and purposes
therein contained, by signing the name of the city of first class by himself as such officer.
WITNESS My hand and official seal on this ,,5 day of �i�,/a,,,,/ , 2013.
aa_..07, - /4 Z_ /-7°F—
Public
6N7fary
7
My commission expires:
JAMIE HUJTCHINS
SALINE COUNTY
— ee
My Commission Expires April 10.2016
Commission No 12385044
l
5
1 1160308-v1
l
E
r [SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
EXECUTED FOR CERTAIN PURPOSES AS AGENT:
LITTLE ROCK ADVERTISING AND PROMOTION COMMISSION
B ,K.A.,N\
WARREN SIAWN,N,CHAAN
1160308-v1
ACKNOWLEDGEMENT
STATE OF ARKANSAS )
)§§
COUNTY OF PULASKI )
On this day before me, the undersigned being a Notary Public of and for the County and
State aforesaid, personally appeared Warren Simpson, who acknowledged himself to be the
Chairman of the Little Rock Advertising and Promotion Commission, and that he, as such
officer, being authorized so to do, executed the foregoing instrument for the consideration, uses
and purposes therein contained, by signing the name of the commission by himself as such
officer.
WITNESS My hand and official seal on this day of, , 2013.
"No Public
My commie .
JAMIE HUT IN.
SAUNE COUNTY
NOTARY PUBUC-ARKANSAS
}
com
My
comm 2016
sa
canmlefu n N6'12365°44 1
7
1160308-v1
[SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
FWH II LITTLE ROCK,LLC
By: FAIRWOOD HOSPITALITY
INVESTORS II, L.L.C., its Member
By: FAIRWOOD INVESTORS II, LLC, its Manager
By: 1: //;(
Name: be., - yr kir•Irj.
Title:___Pie ; '':
6
1160308-v1
ACKNOWLEDGEMENT
STATE OF TENNESSEE
COUNTY OF SHELBY
Before me, the undersigned, a Notary Public, duly commissioned, qualified and acting
within and for said County and State, appeared in person the within named Robert M. Solmson,
to me personally known, who stated that he was the President of Fairwood Investors, LLC, a
Delaware limited liability company and the manager of Fairwood Hospitality Investors II,
L.L.C., a Delaware limited liability company and the sole member of FWH II Little Rock, LLC,
a Delaware limited liability company, and is duly authorized in his capacity to execute the
foregoing instrument for and in the name and behalf of said limited liability pany; and he
further stated and acknowledged that he had so signed, executed and delivered the foregoing
instrument for the consideration, uses and purposes therein mentioned and set forth.
WITNESS my hand and official seal,this the 28th day of February,2013.
Notary Public
My commission expires:
PSORAKN/Cy°,
/��TATE CI
OF
TENNESSEE
NOTARY
PUBLIC
OOG, OF 5‘<>t
MY COMMISSION EXPIRES AUGUST 16,2014
1160308-v 1
[SIGNATURE PAGE TO ESTOPPEL
CERTIFICATE AND TERMINATION OF LEASE]
IN WITNESS HEREOF, the below parties execute this Certificate as of the date first
above written.
BG EXCELSIOR
LIMITED PARTNERSHIP
By: BEX, INC., its gene e p ner
By:
Name: 4.1 & .Wtt{C4lks
Title: '...i` G S c siev
60290279.4
ACKNOWLEDGEMENT
STATE OF 7eNS5EE
COUNTY OF --(-1..6?--in
Before me, the undersigned, a Notary Public, duly commissioned, qualified and acting
within and for said County and State, appeared in person the within named
Jt A( .. • (fit dict: ,;s, , to me personally known, who stated that he was
the ,, ,, tr.. " •r a Zfr of BEX, Inc., the general partner of BG Excelsior Limited
Partnership, a Tennessee limited partnership, and is duly authorized in his capacity to execute the
foregoing instrument for and in the name and behalf of said limited partnership; and he further
stated and acknowledged that he had so signed, executed and delivered the foregoing instrument
for the consideration, uses and purposes therein mentioned and set forth.
WITNESS my hand and official seal, this the 22$.c da - r' .�'.e , 2013.
4.....-----'7/66e.
Notary Public " '`"//"
My commission expires: �/'
\0.D.Kgp4
--/ -- /?-Z 0( 5- STATE #
OF ;
VMS
NOMet FUDIJO a
�i of S� ID
`��
NTY �
ysio 0 5
est
1160308-v1