Loading...
HomeMy WebLinkAboutContract 31500 CITY SECRETARY 1 CONTRACT NO. 03-15-05AG8 : 20 � ROOM BLOCK& MEETING SPACE AGREEMENT Between THE CITY OF FORT WORTH, TEXAS "CITY" and BCWCHI WORTHINGTON, INC "OWNER" DATED: /� ROOM BLOCK& MEETING SPACE AGREEMENT THIS ROOM BLOCK & ETING,,S,,.,P�A,,�E AGREEMENT (the "Agreement") is made and entered into as of the day of , 200Athe "Effective Date"), by and among THE CITY OF FORT WORTH, TEXAS, a municipal corporation organized and existing under the laws of the State of Texas (hereinafter called the "Ciff") and BCM1CHI Worthington, Inc. (hereinafter called the"Owner"). RECITALS WHEREAS, the City is in the process of redeveloping the community's convention assembly venue, currently known as the Fort Worth Convention Center (hereinafter called the "Convention Center"); and WHEREAS, to maximize the performance of the Convention Center and to encourage convention and tourism business in the City, the City desires to facilitate the re-development of first class, full service Hotel in the vicinity of the Convention Center; and WHEREAS, Owner desires to renovate its first class hotel of approximately 504 rooms (the "Hotel")that will be initially operated by Renaissance Hotel Management Company, LLC, a Delaware limited liability company(hereinafter called the"Initial Operator"); and WHEREAS, Owner has entered into a hotel management agreement, under which Owner has agreed the Hotel will be renovated, maintained and operated in accordance with the physical and service standards of a full service Renaissance or similar Hotel; and WHEREAS,the City and Owner have entered into an Economic Development Program Agreement on file in the City Secretary's Office as City Secretary Contract No. (the "Economic Development Agreement") under which the parties agreed to, among other things, enter into a Room Block Agreement pursuant to which specific percentages of the Hotel's standard guest rooms and suites will be reserved for specific periods of time for attendees, participants and planners of conventions and/or trade shows at the Convention Center, and WHEREAS, the City and Owner intend for this Agreement to satisfy the above- referenced obligation of the parties to the Economic Development Agreement; and WHEREAS, Owner has directed Initial Operator to administer, on behalf of Owner and as the Owner's agent,this Agreement; and WHEREAS, Owner shall grant any successor to the Initial Operator the authority and responsibility to administer, on behalf of Owner and as the Owner's agent, this Agreement; and WHEREAS,the City and the Owner desire to enter into this Agreement for their mutual benefit; NOW, THEREFORE: AGREEMENT For and in consideration of the foregoing recitals and of the mutual promises, obligations, covenants and benefits herein contained,the City and the Owner contract and agree as follows: ARTICLE 1 TERMS AND DEFINITIONS In addition to terms defined in the body of this Agreement, the following terms have the meaning set forth in this Article 1. Words used herein in the singular, where the context so permits, also include the plural and vice versa. The definitions of words in the singular herein also apply to such words when used in the plural where the context so permits and vice versa. 1.01 Agreement. As defined in the preamble to this Agreement 1.02 Binding Contract. The contract between Potential Convention Center Customer and Owner and/or Operator that sets forth the terms and conditions under which the Owner/Operator will make an Event Room Block available to the attendees of a specific Citywide Event. 1.03 Block Notice. Block Notice shall have the meaning ascribed to it in Section 11.01(a)of Exhibit A. 1.04 Business Days. Each day other than a Saturday, Sunday, or any legal holiday recognized as such by the City. 1.05 Com. As defined in the preamble to this Agreement (or its successor) acting by and through its City Manager or any Assistant City Manager. Unless provided otherwise in this Agreement,the interests of the City are represented by the Director in this Agreement. 1.06 City-Wide Event. A convention, trade show or other event held at the Convention Center during which a Potential Convention Center Customer, in anticipation of the event, requests that a minimum of 600 hotel guest rooms for one day or more while the event is being held. 1.07 Convention Center. As defined in the preamble to this Agreement and better defined as the convention center facility to be located at 1201 Houston Street in downtown Forth Worth, Texas. - 3 - 1.08 CVB. The Fort Worth Convention& Visitors Bureau or its successor. 1.09 Director. The senior executive of the Convention Center or that person's designee. 1.10 Effective Date. The date set forth in the preamble of this Agreement. 1.11 Exhibit A. Exhibit A is the first exhibit to this Agreement and specifies the functional procedures for administering the day-to-day requirements under the Agreement. 1.12 Event Nim Any night during a City-Wide Event that the number of rooms blocked at the Hotel under this Agreement for a City-Wide Event is greater than or equal to 300. If rooms are blocked under this Agreement for multiple City-Wide Events on the same night,that night will be considered only as one(1)Event Night for purposes of the Maximum Event Night Ceiling. In no event shall any night during a City-Wide Event be considered an Event Night for purposes of the Maximum Event Night Ceiling if the City has not exercised its rights under Section II.01(c) of Exhibit A by giving a Block Notice to the Operator. 1.13 Event Room Block. A block of guest rooms at the Hotel, offered to or reserved for the planners/attendees of City-wide Events. 1.14 Exempt Inventory. The difference between (i) the actual number of guest rooms at the Hotel and(ii)the Maximum Event Room Block. 1.15 Hotel. As defined in the preamble to this Agreement. 1.16 Hotel Site. The tract or parcel, whether one or more, of real property upon which the Hotel, or any part of it, is constructed. 1.17 InitialOffer. Initial Offer shall have the meaning ascribed to it in Section II.01(b) of Exhibit A. 1.18 Initial Offer Date. The date upon which the Operator is required to make an Initial Offer as described in Section II.01(b) of Exhibit A. 1.19 Initial Operator. As defined in the Recitals to this Agreement 1.20 Managed Hotel . Full-service Hotels that are generally comparable to the Hotels that are managed by the Operator or any entity affiliated with, controlled by, under common control with, or controlling Operator. . �� IN 1.21 Management Agreement. The Agreement between Owner and Operator that sets forth, among other things,their respective responsibilities relating to the day-to-day operations of the Hotel. 1.22 Maximum Event Room Block. The Maximum Event Room Block is as follows: (i) for a Citywide Event whose first Event Night is scheduled to occur 48 calendar months or more from the Initial Offer Date, the Maximum Event Room Block shall be 60% of the inventory of Suites plus 60% of the Standard Guest Rooms (rounded); (ii) for a Citywide Event whose first Event Night is scheduled to occur 36 months or more, but less than 48 months from the Initial Offer Date, the Maximum Event Room Block shall be 50% of the inventory of Suites plus 50% of the Standard Guest Rooms (rounded); (iii) for a Citywide Event whose first Event Night is scheduled to occur 24 months or more, but less than 36 months from the Initial Offer Date, the Maximum Event Room Block shall be 40% of the inventory of Suites plus 40% of the Standard Guest Rooms(rounded); (iv)for a Citywide Event whose first Event Night is scheduled to occur less than 24 months from the Initial Offer Date, the Maximum Event Room Block shall be none of the inventory of Suites and none of the Standard Guest Rooms. 1.23 Maximum Event Night Ceiling_ The maximum number of Event Nights in any calendar month during which the Owner (or Operator) shall be obligated to provide blocks of rooms pursuant to this Agreement. Under this Agreement, the Maximum Event Night Ceiling shall be fourteen (14), unless a single Citywide Event causes the number of Event Nights in a given month to go from less than fourteen to greater than fourteen (Example: There are 9 Event Nights on the books for June 2010 and the City exercises it rights under this Agreement to offer a block to an another Citywide Event that will consume an additional 7 Event Nights. In this instance,the Maximum Event Night Ceiling for that month would be 16.) 1.24 Meeting Facilities. The approximately 55,000 square feet of rentable function space in the Hotel,together with all circulation and support space. 1.25 Notice or notice. Each and every communication, request, reply, or advice required or permitted to be given, made or accepted by any party to this Agreement to any other party to this Agreement, each of which shall be given in writing, and deemed received by the intended recipient, in accordance with Section 9.02 below. 1.26 Opening_ The later of the date upon which the Hotel receives a temporary or permanent certificate of occupancy or opens to the public. 1.27 Operator. Either the Initial Operator (as defined in the preamble to this Agreement) or any successor entity. The Operator is the entity responsible for overseeing the day-to-day management of the Hotel and for administering the Owner's responsibilities under this Agreement. - 5 - 1.28 Owner. Owner shall initially mean Owner as defined in the Preamble to this Agreement and any successor entity. 1.29 Party. Either the City or the Owner,the parties to this Agreement. 1.30 Parties. Both the City and the Owner,the parties to this Agreement. 1.31 Potential Convention Center Customer. A person, entity, group or association (or any combination thereof) who is planning a City-Wide Event. 1.32 Rate Quote. Rate Quote shall have the meaning ascribed to it in Section II.01(b) of Exhibit A. 1.33 Room Block Request Notice. Room Block Request Notice shall have the meaning ascribed to it in Section II.01(a)of Exhibit A. 1.34 Sales Representative. Sales Representative shall have the meaning ascribed to it in Section 11.01(a) of Exhibit A. 1.35 Standard Guest Rooms. The Hotel's entire inventory of single-bay sleeping rooms. As of the Effective Date, Owner expects the Hotel to contain 474 Standard Guest Rooms. 1.36 Suite. Any guest room comprised of multiple guest room bays. As of the Effective Date, the Owner expects the Suite inventory to be comprised of 3 Hospitality Suites, 26 Terrace and Balcony Suites, and 2 Suites (Presidential Quality). 1.37 Term. The Term of the Agreement shall be consistent with that set forth in Article 5 below. ARTICLE 2 REPRESENTATIONS 2.01 Representations of the City. The City hereby represents to the Owner that as of the Effective Date: (A) The City is a duly created and existing municipal corporation and authorized to carry on the governmental functions and operations as contemplated by this Agreement. (B) The City has the power, authority and legal right to enter into and perform this Agreement and the execution, delivery and performance hereof (i)have been duly authorized, will not, to the best of its knowledge, violate any applicable judgment, order, law or regulation, and(ii) do not,to the best of its knowledge,constitute a default under,or result in the creation of, - 6 - 6 any lien, charge, encumbrance or security interest upon any assets of the City under any agreement or instrument to which the City is a party or by which the City or its assets may be bound or affected. (C) This Agreement has been duly authorized, executed and delivered by the City and, constitutes a legal, valid and binding obligation of the City, enforceable in accordance with its terms except to the extent that (i) the enforceability of such instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws of general application in effect from time to time relating to or affecting the enforcement of creditors' rights and (ii) certain equitable remedies including specific performance may be unavailable. (D) The execution, delivery and performance of this Agreement by the City does not require the consent or approval of any person which has not been obtained. 2.02 Representations of the Owner. The Owner hereby represents to the City that as of the Effective Date: (A) The Owner is duly authorized and existing in good standing under the laws of the State of Texas, and is qualified to do business in Fort Worth. (B) The Owner has the power, authority and legal right to enter into and perform its obligations set forth in this Agreement, and the execution, delivery and performance hereof have been duly authorized, and will not,to the best of its knowledge,violate any judgment, order, law or regulation applicable to the Owner. (C) The Owner, having the power, authority and legal right to do so, has notified Operator (and will notify any successor Operator) that Operator is required to administer and perform the Owner's obligations set forth in this Agreement, and the execution, delivery and performance hereof, (i) have been duly authorized, and will not, to the best of its knowledge, violate any judgment, order, law or regulation applicable to the Operator or any provisions of the Owner's partnership agreement. (D) Owner shall ensure that Operator has sufficient capital to perform its obligations under this Agreement at the time Operator needs to have sufficient capital. (E) This Agreement has been duly authorized, executed and delivered and constitutes a legal,valid and binding obligation of the Owner, enforceable in accordance with its terms. - 7 - ARTICLE 3 SPECIAL OBLIGATIONS OF CITY 3.01 Convention Center Standards. In addition to its other obligations under this Agreement, during the Term, the City shall operate and maintain the Convention Center to the standard of quality consistent with to a standard of other convention centers that reasonably compete with the Convention Center taking into account the Convention Center's age, ordinary wear and tear and damage from events of casualty excepted. ARTICLE 4 SPECIAL OBLIGATIONS OF OWNER AND OPERATOR 4.01 Records. Owner shall cause Operator to use best efforts to keep reasonable and accurate records relating to the provision of services provided hereunder. The Operator shall prepare and submit to the Director, with a copy to the Fort Worth Convention and Visitors Bureau, on a monthly basis, a summary of all applicable actual and potential bookings at the hotel under this Agreement in a manner that would enable a reasonable person to readily determine what future rooms inventory at the Hotel is available to the City under this Agreement. 4.02 Hotel Standards. At all times during the term of this Agreement Owner shall ensure that the Hotel is operated and maintained in a manner generally consistent with the physical and service standards required under the Management Agreement. In the event of any expiration or termination of the Franchise Agreement, Owner shall ensure that the Hotel is operated and maintained in a manner generally consistent with the physical and service standards required under any first class hotel franchise agreement or substitute Management Agreement that replaces the Management Agreement or, if no such agreement replaces the Management Agreement, Owner shall ensure that the Hotel is operated and maintained to a standard of other comparable first class hotels taking into account the Hotel's age, ordinary wear and tear and damage from events of casualty excepted. 4.03 Designated Representative. At all times during the Term, Owner will ensure that there is a designated representative available and authorized by Owner to perform the obligations set forth in this Agreement. 4.04. Compliance with Obligations Set Forth in Exhibits. At all times during the Term, Owner shall comply with and shall cause Operator to comply with all obligations of Owner and Operator that are set forth in Exhibit"A", which is attached hereto and hereby made a part of this Agreement for all purposes. Notwithstanding anything to the contrary herein, a failure by Operator to comply with any of its obligations set forth in Exhibit "A" shall constitute a default by Owner, in which case Article 6 shall apply. . L' . ✓a:Ufl� V ✓:a ARTICLE 5 TERM AND TERMINATION 5.01 Commencement of the Term of this Agreement. The Term of this Agreement shall commence on the Effective Date. 5.02 Termination of the Term of this Agreement. The Term shall continue until expiration of that certain Economic Development Program Agreement between the City and Owner, effective as of May 25, 2004 unless this Agreement is terminated sooner in accordance with its terms and conditions. ARTICLE 6 EVENTS OF DEFAULT 6.01 Default. A default under the terms of this Agreement shall occur if any party hereto shall materially breach any of the terms, conditions or covenants contained in this Agreement to be performed or observed by it, and such party does not remedy such default within thirty (30) days after Notice or, if the default is of such character as to require more than thirty (30) days to remedy, then if such party fails to commence to cure and correct the default within said thirty (30) day period and thereafter prosecute such corrective action diligently and without interruption and complete the cure thereof within ninety (90) days unless extended by mutual consent following the original Notice of such default (an "Event of Default"). Notwithstanding the foregoing, the failure of Owner to comply with the provisions of Section 4.04 hereof within the time frames set forth therein shall constitute an Event of Default by Owner hereunder without the need of Notice and without any opportunity to cure such Event of Default. Any Notice of default shall be provided to Owner (and to Operator) and shall also be given to Owner's mortgagee (provided such mortgagee has provided Notice to the City and the Director of its name and address where Notices to it hereunder are to be sent). 6.02 Remedies. If an Event of Default is not cured as provided in Section 6.01 hereof, then the non-defaulting party shall have the right to (i) initiate and thereafter prosecute an action in equity for the specific performance of any covenants or obligations to be performed by the defaulting party hereunder or (ii) exercise such other rights as shall be available at law or in equity (excluding, in the case of actions or claims against the City, the recovery of monetary damages). In addition to the foregoing, if an Event of Default is caused by Owner and/or Operator and is not cured as provided in Section 6.01 hereof, the City, at its sole option, shall have the right to (i)terminate this Agreement and the Economic Development Agreement immediately by providing written notice thereof to Owner or (ii) seek and obtain an order of specific performance against Owner so as to compel Owner to comply herewith. As to the City's right to obtain specific performance under this Agreement, Owner acknowledges and agrees that - 9 - :f S Owner's covenants, obligations and representations as set forth in this Agreement are a material and fundamental inducement to the City's redevelopment such that actual damages may not be an adequate remedy at law for the breach hereof by either the Owner or Operator. Accordingly City shall be entitled to seek relief mandating action by Owner hereunder in accordance with this Agreement or declaratory relief with respect to any matter under this Agreement. In addition, the Owner recognizes and agrees that monetary damages could not be calculated to compensate the City for any material breach by Owner of the covenants and agreements contained in this Agreement. Owner further agrees that the City may restrain and enjoin any material breach or threatened material breach of any covenant, duty or obligation of Owner contained in this Agreement without the necessity of (i) posting a bond or other security, (ii) any showing of irreparable harm, balance of harms, consideration of public interest or the inadequacy of monetary damages as a remedy, or (iii) that the administration of an order for injunctive relief would be impracticable. In the event of any breach by Owner of any covenant, duty or obligation contained in this Agreement, Owner stipulates and agrees that the balance of hardships weigh in favor of injunctive relief and that the City may seek and obtain injunctive or other form of ancillary relief from a court of competent jurisdiction in order to maintain the status quo and enforce the terms of this Agreement on an interim basis pending the outcome of the dispute or controversy hereunder. Further, the Owner hereby irrevocably stipulates and agrees that the rights of the City to injunctive relief under this Agreement shall not constitute a "claim" pursuant to Section 101(5) of the United States Bankruptcy Code and shall not be subject to discharge or restraint of any nature in any bankruptcy proceeding involving Owner. 6.03 Owner's Reservation of Rights. Notwithstanding anything to the contrary contained in this Agreement, this Agreement shall in no way limit Owner's or Operator's rights and remedies against a Potential Convention Center Customer resulting from such Potential Convention Center Customer's default under a Binding Contract with Owner or Operator. ARTICLE 7 NO LIABILITY FOR PROPOSED CONVENTION CENTER CUSTOMER; OWNER RESPONSIBILITY TO CAUSE OPERATOR TO PERFORM 7.01 No Liability to City. In no event shall the City, CVB, or any other department or bureau of the City be in any way responsible or liable for the performance by any Potential Convention Center Customer of each customer's obligations under its Binding Contract with the Owner or Operator or for any charges, liabilities or other sums owed by, or liabilities of, such Potential Convention Center Customer (or for those for whom it blocks rooms) to either Owner or Operator. 7.02 Owner and Operator Responsibility. Owner shall cause Operator to perform all of the covenants and agreements of the Operator under this Agreement, and to cause the Operator to observe all of the covenants and agreements of Owner. Owner may have delegated the performance of its obligations and rights hereunder to the Operator under the Management Agreement, but no such delegation shall release or relieve - 10 - Owner from its obligation to perform, or cause to be performed, all of its covenants and agreements set forth herein. Furthermore, all consents, decisions and determinations to be made hereunder by the City shall be made by the Director (or the Director's designee) and no inference to the contrary shall be made because the word "City" is used in some places in this Agreement and the words "Director"is used in others. ARTICLE 8 MISCELLANEOUS 8.01 Severability. If any provision of this Agreement or any application thereof is held to be invalid or unenforceable by any court of competent jurisdiction for any reason, such provision shall be fully severable, and the remainder of this Agreement shall remain in full force and effect. This Agreement shall be construed and enforced as if such invalid or unenforceable provision had never comprised a part of this Agreement. 8.02 Notice. Any notice or other communication required or permitted to be given pursuant to this Agreement shall be given to the other party at the following address: CITY: City of Fort Worth Attn: Director of Public Events 1111 Houston St. Fort Worth, TX 76102 with copies to:both the City Manager and the City Attorney, each at: City of Fort Worth 1000 Throckmorton Fort Worth,TX 76102 OWNER: Capital Hotel Investments, LLC 548 Cabot Street Beverly, MA 01915 Phone: 978-522-7000 t L with copies to: Attn: Nina Matis Katten Muchin Zavis 525 West Monroe Street, Suite 1600 Chicago, Illinois 60661 Phone: 312-902-5560 Barry R. Knight Winstead Sechrest&Minick P.C. 5400 Renaissance Tower Dallas, Texas 75270 Phone: 214-745-5400 OPERATOR: Renaissance Hotel Management Company, LLC c/o Renaissance Worthington Hotel 200 Main Street Fort Worth, TX 76102 Any mortgagee, trustee or beneficiary under any mortgage or deed of trust on the Hotel may, by Notice to the parties set forth hereinabove, designate an address to which notices to it hereunder shall be sent. Any such party may from time to time by Notice as herein provided, designate a different address to which Notices to it shall be sent. Any such notice or communication shall be deemed given on the date so delivered or so deposited in the mail, unless otherwise provided herein. Either party may change the above address by sending written notice of such change to the other party in the manner provided above. With the written consent of the receiving party, notice may be given by facsimile transmission or electronic mail. 8.03 Amendments. This Agreement may not be amended or modified unless such amendment or modification is approved by the City's City Council and reflected in a written document that is signed by the parties hereto. 8.04 Successors and Assigns. All covenants and agreements contained by or on behalf of the City in this Agreement shall bind its successors and assigns and shall inure to the benefit of the Owner and its successors and assigns. The Parties specifically agree that the Owner may not assign its rights, duties and obligations under this Agreement to any other party without the expressed written consent of the City and conditioned on the proposed assignee or successor having executed a written agreement with the City under which such assignee or successor has agreed to assume all covenants and obligations of Owner under this Agreement, as further provided in Section 8.11 of this Agreement. 8.05 Exhibits: Titles of Articles, Sections and Subsections. The exhibits attached to this Agreement are incorporated herein and shall be considered a part of this Agreement for the l y. 771 - 12 - W t. purposes stated herein, except that in the event of any conflict between any of the provisions of such exhibits and the provisions of this Agreement, the provisions of this Agreement shall prevail. All titles or headings are only for the convenience of the parties and shall not be construed to have any effect or meaning as to the agreement between the parties hereto. Any reference herein to a Section or Subsection shall be considered a reference to such Section or Subsection of this Agreement unless otherwise stated. Any reference herein to an exhibit shall be considered a reference to the applicable exhibit attached hereto unless otherwise stated. The headings in this Agreement are for purposes of reference only and shall not limit or define the meaning hereof. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which shall together constitute one and the same instrument. 8.06 Construction. This Agreement is a contract made under and shall be construed in accordance with and governed by the laws of the United States of America and the State of Texas. 8.07 Nature and Extent of Agreement. This Agreement contains the complete agreement of the parties as to the matters contained herein. There are no oral or written conditions, terms, understandings or other agreements pertaining to the booking policy obligations of Owner, Operator and City that have not been incorporated herein. The laws of the State of Texas shall govern the validity, interpretation, performance and enforcement of this Agreement, without regard to conflicts of law principles. Tarrant County, Texas shall be the exclusive venue for all suits or other legal actions arising out of this Agreement. 8.08 Approval by the Parties. Whenever this Agreement requires or permits approval or consent to be hereafter given by any of the parties, the parties agree that such approval or consent shall not be unreasonable withheld or delayed. 8.09 Additional Actions. The Parties agree to take such actions, including the execution and delivery of such documents, instruments, petitions and certifications as may be necessary or appropriate, from time to time, to carry out the terms, provisions and intent of this Agreement and to aid and assist each other in carrying out said terms, provisions and intent. 8.10 Enforcement. The City Attorney or his or her designee may enforce all legal rights and obligations under this Agreement. The Owner shall provide to the City Attorney all documents and records that the City Attorney requests to assist in determining the Owner's compliance with this Agreement, with the exception of those documents made confidential by federal or state law or regulation. 8.11 Transfer of Owner's Interest. In the event of the sale, assignment or transfer by Owner of its fee interest in the Hotel Site (other than a collateral assignment to secure a debt of Owner) to a successor in interest, Owner shall be released or discharged from all of its covenants and obligations hereunder, except such obligations as shall have accrued prior to any such sale, assignment or transfer; and City agrees to look solely to such successor in interest of Owner for performance of such subsequently occurring obligations. Notwithstanding the provisions of the preceding sentence, any successor to Owner hereunder shall in all respects be obligated to honor any contract or agreement previously executed with a Potential Convention Center Customer and shall be bound by any outstanding Initial Offers or Amended Offers, each Room Block Request Notice and the Event Rate then in effect. 8.12 Termination of Operator. In the event that Owner shall terminate the Operator for any reason or should the rights of the Operator under the management agreement for the Hotel expire for any reason, Owner shall be obligated to secure the written consent and agreement of any replacement operator to all of the terms, provisions and conditions set forth herein; provided, that, a failure by the Owner to do so shall in no way release or relieve Owner from performing the obligations of the Owner hereunder. 8.13 Owner and Operator Responsibility under the Binding Contract. Nothing contained in this Agreement shall relieve the Owner and/or Operator (or their respective successors) from the contractual obligations to provided services to a Potential Convention Center Customer under a Binding Contract, irrespective of whether this Agreement has been terminated at the time services are to be rendered or whether this Agreement is terminated after the effective date of the Binding Contract but before the time services are to be rendered. 8.14 Gender; Singular and Plural. As used herein, the neuter gender includes the feminine and masculine, the masculine includes the feminine and neuter, and the feminine includes the masculine and neuter, and each includes a corporation, partnership or other legal entity when the context so requires. The singular number includes the plural, and vice versa, whenever the context so requires. 8.15 Binding Effect. Subject to express provisions hereof to the contrary, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, successors and assigns during the Term hereof and during any extensions or renewals of said Term. 8.16 Exculpation. So long as the Owner is the owner of the Hotel, the liability of Owner for monetary damages under this Agreement shall be limited to its equity interest in the Hotel. In the event that the mortgagee under any deed of trust becomes the "Owner" hereunder, by assignment or otherwise, the liability for monetary damages of such mortgagee under this Agreement shall be limited to its interest in the Hotel. Nothing within this Article 8 shall limit the right of the City to seek specific performance of the terms and provisions of this Agreement by Owner and Operator, and their respective, permitted successors hereunder, or shall otherwise restrict the right of the City to pursue other relief. 8.17 Estoppel Certificate. Within ten (10) Business Days after request therefore by any party hereto, the other party(ies) shall execute and deliver to the requesting party a statement in recordable form and reasonably satisfactory to the requesting party and directed to any proposed mortgagee, purchaser or other transferee certifying any facts that are true with respect to this Agreement, including without limitation(if such be the case)that this Agreement is in full force and effect, that the requesting party is not in default hereunder, and that there are no defenses or offsets to the Agreement claimed by the other party. A failure by the Owner to execute, acknowledge and deliver upon request the certified statement described above within - 14 - ten (10) Business Days from such request shall constitute acknowledgment by the party to whom the request is directed to all persons entitled to rely on the statement that this Agreement is unmodified and in full force and effect and shall constitute a waiver, with respect to all persons entitled to rely on the statement, of any defaults that may exist before the date of notice. 8.18 No Waiver. The failure of either party to insist upon the performance of any term or provision of this Agreement or to exercise any right granted herein shall not constitute a waiver of that party's right to insist upon appropriate performance or to assert any such right on any future occasion. EXECUTED as of the last date indicated below: CITY OF FORT WORTH: BCM/CHI Worthington, Inc: By: Joe Paniakua U 0 Name: r Assistant City Manag Title. �s Date: r! Date: APPROVED AS TO FORM AND LEGALITY: By: :Peter Vaky Assistant City Attorney M&C: C-2009q S-2S-O� Attested By: n[arty Hendrix Citv Secretary t - 15 - ^'cl.�Jl, iUy T�6gyp, EXHIBIT "A" SECTION I SERVICES I.01 Services. Owner shall cause convention room block services outlined in this Exhibit "A" to be provided in accordance with this Exhibit"A". SECTION II COMMITMENT TO PROVIDE CONVENTION ROOM BLOCK SERVICES II.01 Booking Procedure. During the Term, the City, acting through the Director shall require the Operator, as the Owner's representative, to offer an Event Room Block to Potential Convention Center Customers in accordance with this Agreement provided that(a)the Maximum Event Night Ceiling has not been attained and (b) the total number of rooms in the requested Event Room Block on a given night does not cause the Maximum Event Room Block on such night to be exceeded. The right to require that the Operator so offer the Event Room Block will be exercised in accordance with the procedures outlined below. It should be noted that under this Agreement, all obligations of the Owner are expected to be administered by the Operator and that nothing in relationship between Owner and Operator nor any action or inaction on the part of either Owner or Operator shall relieve the other from their respective responsibilities under this Agreement (a) A management, sales or booking representative of the City, the Director or any of their respective designees, including the CVB (each a "Sales Representative"), will notify the Operator that a Potential Convention Center Customer is seeking offers from local Hotel to accommodate, among other needs, the guest room needs of the Potential Convention Center Customer for a City-Wide Event (the "Room Block Request Notice"). The Room Block Request Notice will: (i) identify the Potential Convention Center Customer, (ii) set forth a documented history of the group's room block events for the most recent three year period including a comparison of the number of rooms blocked and the actual number of rooms actually used (provided the same is generally available to the City), (iii) specify each specific date for which the Potential Convention Center Customer will require blocks of guest rooms (including those dates commonly known as "move in" and "move out" dates; and (iv) specify the number of guest rooms the Potential Convention Center Customer is seeking to block on each of the specific dates. The Room Block Request Notice will be communicated to the Operator in the same manner as such notifications are customarily communicated to other Hotel by the Sales Representative. (b) Unless the deadline is specifically extended in writing by the Sales Representative, within five (5) Business Days after Operator's receipt of the Room Block Request Notice, the Operator shall deliver to the Potential Convention Center Customer (with a copy to the Sales Representative and the Director) an initial written offer in response to the Room Block Request Notice (the "Initial Offer"). In the Initial Offer the Operator will (i) offer, for each specific date that the Potential Convention Center Customer requires a block of guest rooms as specified in the Room Block Request Notice, an Event Room Block equal to the lesser of(y)the actual number of the guest rooms in the Room Block Request Notice for each specific date or (z) the Maximum Event Room Block, less any previously offered Event Room Blocks under this Agreement for other City-Wide Events covering such dates, which offers have either been accepted or are still outstanding, and (ii) quote a specific room rate for both a standard single and double room (the "Rate Quote"). The a„mo„nt of the Rate 16 Quote in the Initial Offer will be at the Operator's sole, but good faith, discretion and Operator will not, in an effort to discourage use of the Hotel by the Potential Convention Center Customer, make a quote that is unreasonably high as measured by the rate history of the hotel or of other comparable downtown Fort Worth Hotel , taking into account reasonable differences in quality, amenities, location and suitability. In all respects, the Initial Offer shall be structured in accordance with Operator's normal booking policies as described in Section II.01(e)below. (c) After reviewing the Initial Offer, the Sales Representative may consult with the Operator regarding the Rate Quote contained in the Initial Offer. If at any time within ninety (90) calendar days from the date the Director receives the Initial Offer, the City, the Director or the Director's designee (which may include the CVB) determine, in their sole discretion, that it might be in the City's best interest to compel the Operator to offer the Potential Convention Center Customer an alternative rate structure, the City or CVB may, after consultation with the Operator and within the ninety (90) calendar day timeframe, elect to ask Operator to consider (which election shall be communicated by Notice from the Director or the CVB to the Operator) offering to the Potential Convention Center Customer a rate lower than the rate in the Initial Offer. Within_3 business days following receipt by Operator of such notice from the City or CVB, Operator shall provide the City and the CVB with a written response to such a request, either agreeing or refusing to offer a rate to the Potential Convention Center Customer that is lower than the rate in the Initial Offer. (d) If, pursuant to Section II.01(c) of this Exhibit "A", Operator agrees to offer the Potential Convention Center Customer a rate lower than the rate in the Initial Offer, Operator shall amend the Initial Offer by substituting an alternative rate(the "Amended Offer") and deliver such Amended Offer to the Potential Convention Center Customer(with a copy to the Sales Representative and the Director) within two (2) Business Days following the date of Operator's written response to the City's and/or the CVB's request under Section II.01(c)of this Exhibit"A". (e) In negotiating a Binding Contract, Operator's customary booking policies, including policies relating to acceptance deadlines, contracts, advance deposits and cancellation shall be applied, provided that (i) these policies shall adhere in all material respects to the general customs employed by the Operator at its Managed Hotels and (ii) Operator has provided Director with such booking policies as modified from time to time. Notwithstanding the foregoing, the Potential Convention Center Customer shall have no more than (90) calendar days from the date of the "Current Offer" is received (i) to verbally accept the Current Offer and (ii) negotiate and execute a Binding Contract. (The term, "Current Offer" is hereinafter defined as the most recent of either the Initial Offer or the Amended Offer.) Upon verbal acceptance of the Current Offer, Operator shall promptly begin negotiating a Binding Contract with the Potential Convention Center Customer. (f) If a Potential Convention Center Customer has not (for any reason other than Owner/Operator's breach of their obligations) executed a Binding Contract with the Operator within ninety (90)days following the date of the receipt of the Current Offer, then such offer will expire, whereupon the Owner/Operator shall have no further obligation to the City or the Potential Convention Center Customer in regard to such City-Wide Event under the Current Offer; provided, that, if such offer expires on a date that is more than twenty-four (24) months in advance of the City-Wide Event's first Event Night, nothing in this Agreement shall prohibit the City from issuing a new Room Block Request Notice for such City-Wide Event. (g) During the "Negotiations Period" (defined as the date the Initial Offer is made until the earlier of (i) the Current Offer expiration or (ii) the date the Potential Convention Center Customer formally rejects/accepts the Current Offer) the Operator shall consider the Event Room Block from an inventory management/reservations standpoint as if it were booked under a Binding Contract and shall not agree to reserve any amount of guest rooms for other customers that would impede the ability of the Hotel to 17 , jv , L `j. v accommodate the Event Room Block under the Current Offer. Notwithstanding the foregoing, if another Potential Convention Center Customer seeks, during the Negotiations Period, to reserve an Event Room Block on one or more of the Event Nights being held for the first Potential Convention Center Customer ("First Customer") pending the conclusion of the Negotiation Period, Operator shall be permitted to accelerate the Current Offer expiration date of the First Customer to a date that is seven (7) calendar days from the date that Operator notifies First Customer, in writing, of such acceleration. Operator's ability to accelerate the Current Offer expiration date is acknowledged by the parties to be part of the Operator's customary booking policies. (h) During the Negotiations Period, the Event Room Block offered in the Initial Offer shall not be modified downward by virtue of the fact that the time parameters that dictate the release of rooms under the definition of Maximum Event Room Block expire. If, for example, the Event Room Block offered in the Initial Offer was for 80% of the Hotel's Standard Guest Rooms and the 48 month cut-off period expires during the Negotiation Period, as specified in Section 1.22 of this Agreement, the Event Room Block under negotiations shall continue to be 80% of the Standard Guest Rooms. (i) If a Potential Convention Center Customer that has executed a Binding Contract provides written notice to Owner/Operator that the Potential Convention Center Customer is terminating the Binding Contract, and the date of receipt by Owner/Operator of such notice is less than twenty-four (24) months from the first night reserved for the Potential Convention Center Customer's Event Room Block, then, provided that Owner/Operator has provided the City with advance written notice of such termination, Owner/Operator will have no further obligation to the City in regard to such Event Room Block and Operator shall not be obligated to extend the rooms to another Potential Convention Center Customer hereunder. If such notice of termination is given on a date that is twenty-four (24) months or more before the first Event Night, the Event Nights covered by the Room Block Request Notice for such City-Wide Event will not be included in calculating the Maximum Event Night Ceiling, and the City may require that Operator extend the rooms to another Potential Convention Center Customer in accordance with the provisions hereof; provided, however, if the Maximum Event Night Ceiling had been reached prior to such cancellation, Operator will have no obligation to cancel any bookings to accommodate such subsequent request (for example, once the Maximum Event Night Ceiling has been reached, the Operator is free to book the remaining inventory of rooms hereunder for such month and Operator shall not be obligated to cancel any rooms reservations for such month to accommodate a replacement block). The City recognizes that under the Operator's contract with the Potential Convention Center Customer, Owner/Operator may be entitled to collect cancellation fees from such Potential Convention Center Customer and the City hereby acknowledges and agrees that such fees shall be the sole property of Owner. Similarly, the Owner/Operator recognizes that under the City's contract with the Potential Convention Center Customer, the City may be entitled to collect cancellation fees from such Potential Convention Center Customer and the Owner/Operator hereby acknowledges that such fees shall be the sole property of the City. In addition, Owner/Operator agree that although this Agreement requires Owner/Operator to offer and reserve Event Room Blocks to Potential Convention Center Customers, the City, the CVB, and their officers and employees, shall not be liable to Owner or Operator for damages of any kind whatsoever, including, without limitation, damages for lost profits or lost business, as a result of any breach or termination of a Binding Contract by a Potential Convention Center Customer. 0) Operator will reserve the inventory of rooms required in an Event Room Block for purchase by the persons attending a given Potential Convention Center Customer's event until the thirtieth (30'') calendar day preceding the first night reserved for the Potential Convention Center Customer's Event Room Block, after which time any unbooked rooms will be released from the obligations under this Agreement(but not necessarily from the obligations under the Binding Contract) and may be rented without any restrictions imposed by this Agreement. If within ninety (90) calendar days of the first night reserved for the Potential Convention Center Customer's Event Room Block, the number of rooms actually booked is less than the number of rooms blocked, 18 then Operator may seek the City's consent to release some or all unbooked rooms and the City agrees not to unreasonably withhold such consent. Notwithstanding the foregoing, Operator shall be permitted at any time to release some or all unbooked rooms without the consent of the City,provided (A) that the Potential Convention Center Customer has granted its written consent to do so and (B) in so doing, Operator shall not waive any cancellation rights to which the Hotel may be entitled. (Under this Section II.01(i), the term, "booked," means there is a room reservation on file that guaranteed (i) by time of arrival, (ii) by deposit or (iii) by credit card as required under the Hotel's normal reservation policy.) Furthermore, if the group history of the Potential Convention Center Customer reflects a pattern whereby the block of rooms reserved by such customer is greater than the actual number of rooms used, then the Operator, with the written consent of the Director (which consent shall not unreasonably be withheld), shall have the right to only block such number or rooms which Operator, in the exercise of its professional judgment and based on such history of the customer, believes will be adequate to accommodate the number of rooms which will be actually used by such customer; provided, that such decision shall not release or relieve the Owner/Operator from, at Owner/Operator's own cost, providing other comparable guest accommodations if the number of rooms so blocked by Operator actually is not adequate to satisfy the actual use of rooms by the Potential Convention Center Customer. (k) There are three categories of inventory that, under this Agreement, may be reserved by Operator, without restrictions imposed by this Agreement. The first category is Exempt Inventory. Exempt Inventory is free from any City-imposed booking restrictions under this Agreement and the Operator may, at its discretion, take reservations for up to the amount of the Exempt Inventory for any given day in the future. The second category is inventory that becomes released after the Maximum Event Night Ceiling is achieved. In any month that the Hotel achieves the Maximum Event Night Ceiling, upon of the execution of a Binding Contract that causes the Maximum Event Night Ceiling to be achieved, any remaining inventory for that month not contractually reserved under this Agreement (the "Unreserved Inventory") will be immediately released from further booking restrictions under this Agreement (subject to subsection (h) above). The third category is inventory that has not been reserved under this Agreement as of any date that is less than twenty-four (24) months from the start of any City-Wide Event. Any room inventory meeting these criteria shall be available for rental by the Operator without restrictions imposed by this Agreement. (1) Notwithstanding the foregoing, if a Potential Convention Center Customer has a documented history of causing material property damage in connection with group events or of poor credit, then Operator shall have the right to decline to accommodate such customer hereunder upon provision of written notice to the Director given within five (5) Business Days following the date of the Room Block Request Notice, which notice a reasonable and specific basis for the Operator's conclusions, which conclusions are subject to the Director's reasonable challenge and will be kept confidential to the full extent of the law,by the Director. II.02 Confidentiality. Subject to its obligations under applicable law, the City will not disclose any Initial Offer or Amended Offer to any person or entity other than its employees, counsel and other consultants, or in connection with any legal proceeding (or alternative dispute resolution procedure), all of whom shall be advised of the confidentiality provisions hereof and agree to the same. SECTION III OTHER COOPERATIVE PROGRAMS III.01 Cooperative Advertising. The Owner, through the Operator and at no cost to the City, will cooperate with the City and or the CVB by placing logos and slogans, approved by Operator, on Hotel advertising material targeting the meetings and tourism markets as directed by the City/CVB. 19 U III.02 Site Selection Assistance. The Owner, through the Operator and at no cost to the City, will periodically assist the City and CVB with its convention marketing efforts by providing, subject to availability, mutually acceptable complimentary or discounted-to-cost rooms and facilities to event planner conducting site visits and or participating in familiarization trips. 20 I J City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION: Approved on 5/25/2004 DATE: Tuesday, May 25, 2004 LOG NAME: 17WORTHINGTON REFERENCE NO.: C-20094 SUBJECT: Authorize Execution of Economic Development Program Agreement with BCM/CHI Worthington, Inc. Regarding Redevelopment of the Renaissance Worthington Hotel RECOMMENDATION: It is recommended that the City Council: 1. Authorize the City Manager to execute an Economic Development Program Agreement with BCM/CHI Worthington, Inc. (Worthington) or an affiliated entity related to the redevelopment of the Renaissance Worthington Hotel; and 2. Find that the terms and conditions of the incentive program, as outlined below, constitute a custom- designed economic development program in accordance with Chapter 380 of the Texas Local Government Code. DISCUSSION: According to studies that have been commissioned by the City to analyze how tourism and convention business in the City can best be promoted, there is a need for at least 1,500 first class hotel rooms in downtown Fort Worth. Despite the fact that the City is in negotiations to cause development of a 600-room hotel directly across from the Convention Center, this hotel alone will not be sufficient to accommodate a full-size convention at the Convention Center or to fulfill the hotel needs of the City,that have been identified in the City's studies. The Worthington is one of only two hotels in downtown Fort Worth that were identified by the study undertaken by HVS International as "good quality". As a result, it is in the City's best interest to ensure that the Worthington at a minimum maintains its current standards. Under the proposed agreement, the Worthington has committed to i) substantially complete at least $6.7 million in upgrades to the hotel by December 31, 2004, and at least $4.5 million in upgrades to the hotel by December 31, 2008; and ii) spend at least 30% of its total construction costs in making those improvements with Fort Worth contractors; and iii) spend at least 20% of its total construction costs in making those improvements with Fort Worth contractors that are certified as Fort Worth M/WBE companies. Worthington will be required to maintain a Mobil Travel Guide 3-Star rating at a minimum; and ensure that the Hotel continues to operate and market itself under a first tier flag brand name, as outlined below. In addition, Worthington will be required to enter into a Room Block Agreement with the City that allows rooms to be reserved for Convention Center events. Worthington will make major renovations to the hotel ballrooms, the facade, and the 505 guest rooms. The planned renovation will be instrumental in increasing Fort Worth's ability to attract large conventions. In return for the economic benefits and the number of first class hotel rooms that will be retained as a result of the Hotel, the City will make economic development program grants to Worthington, as authorized by. Logname: 17WORTHINGTON Page 1 of 3 Section 380 of the Texas Local Government Code, until either i) Worthington has received the maximum grant payments outlined in the attachment or ii) the expiration of 20 years. These grant payments will commence in the first full year following the renovation. Employment: Worthington has committed 60% of the total number of full-time jobs on the property to be filled by Fort Worth residents, and 30% of the total number of full-time jobs on the property to be filled by Central City residents. However, in any year that these commitments are not met and Worthington's occupancy rate is less than 63%, Worthington will have the right to a public hearing before the City Council before any program grant payment under the Agreement may be reduced. Utilization of Fort Worth Businesses: Regarding the utilization of Fort Worth based businesses, Worthington has committed 30% of total construction to Fort Worth construction contractors and/or subcontractors. Utilization of Fort Worth M/ BE: Regarding the utilization of Fort Worth Minority Business Enterprises (MBEs) and Fort Worth Women Business Enterprises (WBEs), Worthington has committed 20% of total construction spending to certified Fort Worth M/WBE construction contractors and/or subcontractors. Annual Grants The actual amount of each grant will depend upon the extent to which Worthington meets all of its commitments outlined above, and will be an amount equal to i) up to 100% incremental sales tax (1%) generated on the property and ii) up to 100% incremental Hotel Occupancy Tax (7%) generated on the property, as capped per the attached schedule. However, each grant may be reduced by the cumulative degree to which Worthington fails to meet its construction spending goals and its employment goals. In addition, the City will suspend the payment of grants for any period in which (i) the Hotel fails to retain a Mobil Travel Guide 3-Star rating or to operate as a first tier flag hotel or ii) Worthington is in breach of its Room Block Agreement. The proposed Agreement is authorized by Chapter 380 of the Texas Local Government Code and is consistent with the City's commitment to use custom-designed incentives and partnership programs with private businesses on a case-by-case basis to help ensure the growth and diversification of the local economy, as stated in the 2004 Comprehensive Plan adopted by the City Council on February 24, 2004. The 2004 Comprehensive Plan recognizes, and the City Council hereby finds, that tourism, both for business and for pleasure, is a significant component of the City's economy and that the Fort Worth Convention Center and downtown hotels are critical elements in the City's efforts to promote tourism in the City. This property is located is COUNCIL DISTRICT 9. Logname: 17WORTHINGTON Page 2 of 3 FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that this action will have no direct expenditure from currently held City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office by: Reid Rector (6140) Originating Department Head: Tom Higgins (6192) Additional Information Contact: Petery Vaky (7601) Tom Higgins (6192) Logname: 17WORTHINGTON Page 3 of 3