HomeMy WebLinkAboutHDC2009-005 Letter Agreement Between Hostelling Arkansas, Inc. an Arkansas Nonprofit Corporation (HAI) And The City Of Little Rock Regarding A Hostel And Firehouse Museum 01/09/20066-
.January j , 2006
Bruce T. Moore, City Manager
City of Little Rock
500 West Markham Street
Little Rock, Arkansas 72201
Linda Fordyce, President
Hostelling Arkansas, Inc.
1201 Commerce Street
Little Rock, Arkansas 72202
Re: Letter Agreement between Hostelling Arkansas, Inc., an Arkansas nonprofit corporation
("HAI"), and the City of Little Rock (the "City"), regarding a hostel and firehouse
museum to be located in Little Rock's MacArthur Park (the "Agreement")
- As part of its master parks plan, the City is interested in entering into cooperative efforts
to enhance the overall quality and programming of its parks. As part of this goal, the City would
like to use the historic fire station located at 1201 Commerce Street in Little Rock's MacArthur
Park to (1) develop a museum that recognizes the contributions that members of the Little Rock
Fire Department have made to the City, and educates the public about those and other
contributions, and (2) develop a hostel to serve visitors to the City (the "Firehouse Hostel and
Museum"). The City will provide land, programming, and services to develop the Firehouse
Hostel and Museum, and hereby engages the services of HAI to undertake the ongoing operation
and management of the Firehouse Hostel and Museum. For the remainder of this letter, the City
and HAI may be referred to singularly as a "party", or collectively as the "Parties". The Parties
agree as follows:
Definitions. As used in this letter, the following terms shall have the following
definitions:
(a) "Common Areas" means those areas and facilities which may be furnished by the
City in, on, or near the Premises for the non-exclusive general common use of HAI and its
officers, agents, employees, customers, or invitees, including (without limitation) all parking
areas, access roads, employee parking areas, truckways, driveways, loading docks and areas,
delivery passages, package pick-up stations, sidewalks, malls, roofs, skylights, sprinklers, courts,
ramps, landscaped and planted areas, retaining walls, stairways, escalators, elevators, bus stops,
first -aid stations, sewage treatment facilities, if any, lighting facilities, comfort stations or rest
rooms, civic center, meeting rooms, and other similar areas, facilities or improvements, as may
exist from time to time.
(b) "Cooperative Period" means the period of time extending fifty (50) years from
and after the Effective Date.
(c) "Cooperative Use" means operating a hostel, museum, and educational facility,
and conducting any operational, fundraising (in HAI's or the City's name), corporate, nonprofit,
or other activities in connection therewith.
(d) "Effective Date" means the date of this letter.
(e) "Premises" means, collectively, the Subject Building(s) and the Subject Property.
(f) "Subject Building(s)" means the building located at 1201 Commerce Street, Little
Rock, Arkansas 72202, as shown on EXHIBIT A, attached hereto and incorporated herein by
this reference, and any other structures located on the Premises from time to time.
(g) "Subject Property" means the real property described on EXHIBIT B, attached
hereto and incorporated herein by this reference.
Cooperative Period. This Agreement is effective as of the Effective Date, and shall
continue for the Cooperative Period, unless sooner terminated as explained below. HAI shall
have the option of terminating this Agreement, without penalty, twenty-five (25) years from the
Effective Date, upon written notice given to the City ninety (90) days prior to the conclusion of
said twenty-five (25) year period. The City shall have the option of terminating this Agreement,
without penalty, twenty-five (25) years from the Effective Date, upon written notice given to
HAI fourteen (14) months'prior to the conclusion of said twenty-five (25) year period. If, at the
conclusion of the Cooperative Period, HAI is still using the Premises for the Cooperative Use, it
may continue to do so under the terms of this Agreement until it receives sixty (60) days notice
from the City that it must cease the Cooperative Use on the Premises.
Cooperative Use. The City agrees that HAI may begin carrying out the Cooperative Use
upon the Premises and Common Areas upon the Effective Date. As long as HAI is using the
Premises for this purpose, the City shall not operate a hostel or museum on the Premises.. In
connection with the hostel component of the Cooperative Use, HAI shall, to the extent
reasonably possible, comply with the rules and regulations provided on EXHIBIT C. attached
hereto and incorporated herein by this reference; with the understanding that HAI may modify
and amend the rules and regulations from time to time.
Records. HAI agrees that it shall comply with the record -keeping standards accepted in
the industry among other nonprofit 501(c)(3) entities. HAI shall annually provide to the City its
annual financial statements, completed by a certified public accountant. HAI shall also provide
to the City any information and documents necessary for the City to complete its own yearly
audit. The City and HAI agree that any proceeds generated from the Firehouse Hostel and
Museum through room rental, ticket prices, fundraising, or otherwise, shall be used only for
nonprofit purposes including but not limited to the maintenance, development, and improvement
of the Firehouse Hostel and Museum, and the continuation of the Cooperative Use.
Taxes. The City agrees that the Premises are currently exempt from taxation. HAI
agrees to maintain its nonprofit status, and to use the Premises for activities that do not
jeopardize said status. If the Premises should ever be found taxable, the Parties shall oppose
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such taxation to the extent legally permissible_ If HAI's activities directly cause the Premises to
become taxable, then HAI shall be responsible for the payment of those taxes.
Maintenance. With regard to the Premises, HAI shall: (a) keep the inside and outside of
all glass in the doors and windows of the Premises clean; (b) keep all exterior surfaces of the
Premises clean, (c) contact the City to replace any cracked or broken glass of the Premises; (d)
keep the Premises in a clean, orderly and sanitary condition and free of insects, rodents, vermin
and other pests; (e) keep any garbage, trash, rubbish or other refuse in rat -proof containers within
the interior of the Premises until removed; (f) comply with all laws, ordinances, rules and
regulations of governmental authorities and all recommendations of the City's fire insurance
rating organization now or hereafter in effect; (g) conduct its business in all respects in a
dignified manner; and (h) comply with all Federal, State, and local laws regarding Hazardous
Wastes. The City, at its expense, shall repair and maintain in good condition, all of the Premises,
including but not limited to the Subject Building(s) and any fixtures thereto. The City shall also
maintain the lawn and any landscaping that exists, or may exist, on the Premises, with the
understanding that any special gardens or planting areas HAI installs on its own shall be its own
responsibility. The City will operate and maintain the Common Areas, or will cause to be
operated and maintained the Common Areas, in good condition and in a reasonable manner.
HAI understands that the City does not provide routine repair and maintenance to the Premises
and Common Areas, and shall notify the City when repair and maintenance are needed_
Utilities. The City will provide Premises with water, gas, telecommunications,
electricity, and sanitary sewer services. If HAI desires to install any equipment which shall
require additional utility facilities or utility facilities of a greater capacity than the facilities
provided by City, such installation shall be subject to City's ability to pay for such extension and
prior, written approval. City shall also be responsible for providing any meters or other devices
for the measurement of utilities supplied to the Premises.. Except as set forth below, the City
shall be solely responsible for promptly paying, as and when the same become due and payable,
all charges for water, gas, electricity, and sanitary sewer services, and any other utility used or
consumed on or in the Premises. The City shall pay HAI's telecommunications services up to a
maximum of $Z,000 per year.
Alterations. Renovations. and lrn rovements. HAI shall prepare a master plan for City's
approval that anticipates alterations, renovations, and improvements, and HAI shall keep this
master plan on file for periodic reviews and updates. HAI will not make any major alterations,
renovations, improvements or other installations in, on or to the Premises or any part thereof
unless and until HAI shall have caused plans and specifications for said major alterations,
renovations, improvements or other installations to have been prepared by an architect or other
duly qualified person, and shall have obtained the City's prior, written approval thereof. If such
written approval is granted, HAI shall cause the work described in such plans and specifications
to be performed promptly, efficiently, competently and in a good and workmanlike manner by
duly qualified or licensed persons or entities. The City further agrees to assist HAI in
undertaking said alterations, renovations, and improvements, by providing or obtaining
approvals for permits, licenses, or any other items necessary for completing the alterations,
renovations, and improvements, and providing HAI with any information or documents needed
for completing the alterations, renovations, and improvements.
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Signa. HAI may, at its cost and expense, install and maintain permanent signage on
the Premises. Said permanent signage shall be installed and maintained in accordance with the
City's guidelines, and shall be approved prior to installation by the City's Director of Parks and
Recreation, with the understanding that such approval shall not be unreasonably withheld -
Ownership of Pro ert . Except as set forth below, any and all fixtures and other items of
personal property located in or upon the Premises and purchased or provided by HAI or any of
its donors, including but not limited to the contents of the museum, shall remain HAI's sole and
exclusive property, and may be removed from the Premises by HAI at any time. Any items of
personal property donated to HAI by the City shall remain the property of the City, and may be
removed from the Premises by the City at any time_
Insurance. At all times after the execution of this Agreement, the City will carry and
maintain, at no expense to HAI, a policy or policies of hazard insurance, covering fire and other
extended coverage risks, written at a minimum of replacement cost value and with replacement
cost endorsement, covering all real property, and any attachments or improvements thereto or
structures thereon, in and on the Premises, including but not limited to any and all improvements
installed in or on the Premises by or on behalf of HAL The City's hazard insurance policies
covering the Premises shall name HAI or its designee as additional insured and shall also contain
a provision by which the insurer agrees that it shall give HAI or its designee thirty (30) days
written notice prior to any cancellation, non -renewal, or change in scope or amount of coverage
of such insurance. Each such policy, or a certificate thereof together with a duplicate copy of
such policy, shall be promptly deposited with HAI. HAI shall provide to the City for insurance
purposes, upon request, a reasonable valuation of any portion of the Premises or Common Areas.
If the Premises shall be damaged, and the insurance proceeds are adequate to repair the
Premises, as determined by the City, the City shall promptly cause such damage to be repaired.
If the insurance proceeds are inadequate to repair such damage, HAI shall have the option of
making up the difference in the costs of repair within six (b) months of the date that the damage
occurred. If HAI makes up said difference, the City shall promptly cause such damage to be
repaired. The City agrees to use its best efforts to utilize all insurance proceeds for the further
development of a hostel and museum with a use similar to the Cooperative Use. If the Premises
are (a) rendered unusable for the Cooperative Use, (b) damaged as a result of any cause which is
not covered by insurance, or (c) damaged or destroyed in whole or in part during the last three
(3) years of the Cooperative Period, or if the Premises are damaged to the extent of fifty percent
(50%) or more of then, HAI or the City may elect to terminate this Agreement.
Takin . If the whole or any part of the Premises shall be taken under the power of
eminent domain, this Agreement shall terminate as to the part so taken on the date the City is
required to yield possession thereof to the condemning authority. HAI and the City shall have
the option of making such repairs and alterations as may be necessary in order to restore the part
not taken to useful condition. If the aforementioned taking renders the remainder of the Prenvses
unsuitable for the Cooperative Use, either party may terminate this Agreement as of the date
when the City is required to yield possession. The City agrees to use its best efforts to utilize all
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compensation awarded for any taking of the Premises for the further development of a hostel and
museum with a use similar to the Cooperative Use.
Breach of Agreement. Except in cases involving discrimination, as discussed in the
subsequent paragraph, (1) HAI shall be in Material Breach of this Agreement upon HAI's
material breach of the terms of the Agreement, and the failure of HAI to remedy such breach
within thirty (30) days after written notice thereof is given by the City to HAI; and (2) the City
shall be in Material Breach of this Agreement upon the City's material breach of the terms of
the Agreement, and the failure of the City to remedy such breach within thirty (30) days after
written notice thereof is given by HAI to the City. Upon the expiration of said thirty (30) day
period without a remedy of the Material Breach, the City or HAI may terminate this
Agreement and confirm such termination by way of written notice, and may exercise any legal
or equitable right or remedy authorized by applicable law.
Discrimination. It is intended that the Premises shall be developed so that all customers,
employees, licensees, and invitees shall have the opportunity to obtain all the goods, services,
accommodations, advantages, facilities, and privileges of the Premises without discrimination
because of race, creed, color, sex, national origin, ancestry, or disability, to the extent such
disability is protected by applicable law. If HAI is ever found guilty of such discrimination, in a
final judgment, by a court of competent jurisdiction, it shall immediately be considered a
Material Breach of this Agreement, and no opportunity to cure shall be provided.
Notices. Any notice, request, demand, approval or consent given or required to be given
under this Agreement shall be in writing and shall be deemed to have been given on the third day
following the day on which the same shall have been mailed by United States registered or
certified mail, return receipt requested, with all postage charges prepaid, addressed as set forth
below, with the understanding that either party may, at any time, change its notice address by
sending a notice to the other party stating the change and setting forth the new address.
For the City: Director of Parks and Recreation
500 West Markham Street
Little Rock, Arkansas 72201
With required copies to:
City Manager
500 West Markham Street
Little Rock, Arkansas 72201
City Attorney
500 West Markham Street
Little Rock, Arkansas 7220I
For HAI: Hostelling Arkansas, Inc.
Firehouse Hostel and Museum
P.O. Box 2753
Little Rock, Arkansas 72203
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With a required copy to:
Chad M. Avery
Gill Elrod Ragon Owen & Sherman, P.A.
425 West Capitol Avenue, Suite 3801
Little Rock, Arkansas, 72201
Upon reasonable notice, as determined by the City, the City, its agents, employees and
contractors may enter all parts of the Premises to inspect the same and to enforce or carry out any
provision of the Agreement including, without limitation, any access necessary for the making of
any repairs.
Compliance. The City, at its sole cost and expense, shall comply with and shall cause the
Premises to comply with (a) all federal, state, county, municipal and other governmental statutes,
laws, rules, orders, regulations and ordinances affecting the Premises or any part thereof, or the
use thereof, including, but not limited to, those which require the making of any structural,
unforeseen or extraordinary changes, whether or not any such statutes, laws, rules, orders,
regulations or ordinances which may be hereafter enacted involve a change of policy on the part
of the governmental body enacting the same, and (b) all directions, rules, orders and regulations
of the fire marshal, health officer, building inspector, other appropriate officers of governmental
agencies having _jurisdiction over the Fire Protection Association, the National Electrical Code,
the American Society of Heating and Air Conditioning Engineers, all carriers of insurance on the
Premises, any board of underwriters, rating bureau and similar bodies, the City's insurance rating
organization and any and all other bodies exercising similar functions in connection with the
prevention of fire or the correction of hazardous conditions which apply to the Premises or to
HAI's use of the Premises.
Miscellaneous. Any intention to create a joint venture or partnership relation between the
Parties is hereby expressly disclaimed. The submission of this Agreement for examination does
not constitute a reservation of or option for the Premises, and this Agreement shall become
effective only upon execution and delivery thereof by both Parties. This writing is intended by
the Parties as a final expression of their agreement and as a complete and exclusive statement of
the terms thereof; all negotiations, considerations and representations between the Parties having
been incorporated herein. No course of prior dealings between the Parties or their officers,
employees, agents or affiliates shall be relevant or admissible to supplement, explain, or vary any
of the terms of this Agreement,. Acceptance of, or acquiescence in, a course of performance
rendered under this or any prior agreement between the Parties or their affiliates shall not be
relevant or admissible to determine the meaning of any of the terms of this Agreement.
No representations, understandings, or agreements have been made or relied upon in the
making of this Agreement other than those specifically set forth herein. This Agreement can be
modified only by a writing signed by the party against whom the modification is enforceable. If
any term or provision, or any portion thereof, of this Agreement, or the application thereof to any
person or circumstances shall, to any extent, be invalid or unenforceable, the remainder of this
Agreement, or the application of such term or provision to persons or circumstances, other than
those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term
and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by
1:lCA' AXHasie ling Arkanw. 1ne41paem=tslLcsrer Apo menl 0 &v 6
law. Nothing contained in this Agreement shall be construed so as to confer upon any other
party the rights of a third party beneficiary.
This Agreement and the rights and obligations of the Parties shall be construed,
interpreted, and enforced in accordance with the laws of the state of Arkansas. The Parties
expressly agree that, with regard to any dispute arising hereunder or having to do with the
performance of either party hereto, including any and all alleged breaches of the Agreement
(whether or not defined herein), such dispute shall be litigated in the jurisdiction and venue
required by applicable Arkansas law. The Parties do hereby consent and agree to such venue and
jurisdiction. The City consents and agrees that HAI or users of future buildings erected on or
adjacent to the Premises, and the officers, agents, employees, customers, and invitees thereof;
may use the access drives to and from the Premises. This Agreement shall survive any change in
the City's form of government.
Sincerely,
Bruce T.. Moore
City Manager, City of Little Rock, Arkansas
The above Agreement is understood and agreed to as of the Effective Date.
HOSTELLING ARKANSAS, INC,
an Arkansas nonprofit corporation
ALi a Fordyce, President
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EXHIBIT A
SUBJECT BUILDING(S)
That certain building currently located at 1201 Commerce Street, Little Rock, Pulaski County,
Arkansas 72202.
EXHIBIT B
SUBJECT PROPERTY
1201 Commerce Street, Little Rock, Pulaski County, Arkansas 72202.
EXHIBIT C
RULES AND REGULATIONS