HomeMy WebLinkAboutContract 52383 CITY SECRETARY
CONTRACT NO.
5 2U�9
ROOM BLOCK& MEETING SPACE AGREEMENT
Between
THE CITY OF FORT WORTH, TEXAS
"CITY"
and
K MAIN HOTEL, LLC
"OWNER"
DATED:
U y1� , 2019
I
MAL RECORDY SECRETARY WORTH,T X
ROOM BLOCK& MEETING SPACE AGREEMENT
THIS ROOM BLOCK & MEETING SPACE AGREEMENT (the "Agreement") is
made and entered into as of the qKday of_ J u vie,- , 2019 (the "Effective Date"),
by and between THE CITY OF FORT WORTH, TEXAS, a municipal corporation organized
and existing under the laws of the State of Texas (hereinafter called the"City") and K Main Hotel,
LLCa Delaware limited liability company(hereinafter called the"Owner").
RECITALS
WHEREAS, the City has recently redeveloped the community's convention assembly
venue, 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 development of first
class, full service hotels in the vicinity of the Convention Center; and
WHEREAS,Owner desires to develop an upper upscale level hotel of approximately 226
guest rooms (the "Hotel") to be located near the Convention Center; and
WHEREAS, Owner has entered into a ground lease (the "Ground Lease") with the City
for the Hotel Site; and
WHEREAS,the City and Owner have entered into an Economic Development Agreement
(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 shall grant to any successor and to any party which operates the Hotel
on Owner's behalf(the "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:
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ARTICLE I
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.
1.01 Agreement. As defined in the preamble to this Agreement.
1.02 Amended Offer. As defined in Section 2.01(d) of Exhibit "A" to this Agreement.
1.03 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.
1.04 Business Days. Each day other than a Saturday, Sunday, or any legal holiday
recognized as such by the City.
1.05 City. 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 hotels in the City(including the Hotel)and the surrounding metropolitan areas provide, in the
aggregate, a minimum of 1100 guest rooms for one night or more while the event is being held.
1.07 Competing Convention Center Facilities. Competing State Convention Center
Facilities and Competing National Convention Center Facilities, collectively.
1.08 Competing State Convention Center Facilities. Other convention centers providing
convention center facilities in Texas that reasonably compete with the Convention Center from
time to time. For purposes of this Agreement, Competing State Convention Center Facilities
currently include the Dallas Convention Center, Austin Convention Center, San Antonio
Convention Center, and Houston Convention Center.
1.09 Competing National Convention Center Facilities. Other convention centers
outside of Texas that reasonably compete with the Convention Center from time to time. For
purposes of this Agreement, Competing National Convention Center Facilities currently include
the Charlotte Convention Center, Music City Center(Nashville) , Kansas City Convention Center,
and Minneapolis Convention Center.
1.10 Convention Center. As defined in the preamble to this Agreement and better
defined as the convention center facility located at 1201 Houston Street in downtown Fort Worth,
Texas.
1.11 Convention Center Requirements. As defined in Section 4.02(A).
1.12 Current Offer. As defined in Section 2.01(e) of Exhibit "A"to this Agreement.
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1.13 CVB. The Fort Worth Convention&Visitors Bureau or its successor.
1.14 Director. The senior executive of the Convention Center or that person's designee.
1.15 Economic Development Agreement. As defined in the Recitals of this Agreement.
1.16 Effective Date. The date set forth in the preamble of this Agreement.
1.17 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.
1.18 Event Night. A night during a City-Wide Event when the out-of-town participants
of same would reasonably be staying overnight in the City.
1.19 Event Room Block. A block of guest rooms at the Hotel, offered to or reserved for
the planners/attendees of City-Wide Events.
1.20 Exempt Inventory. The difference between (i)the actual number of guest rooms at
the Hotel and (ii)the Maximum Event Room Block.
1.21 First Customer. As defined in Section 2.01(g) of Exhibit"A".
1.22 Ground Lease. As defined in the Recitals of this Agreement.
1.23 Hotel. As defined in the Recitals of this Agreement.
1.24 Hotel Site. The tract or parcel, whether one or more, of real property upon which
the Hotel, or any part of it, is constructed.
1.25 Initial Offer. Initial Offer shall have the meaning ascribed to it in Section 2.01(b)
of Exhibit"A".
1.26 Initial Offer Date. The date upon which the Operator is required to make an Initial
Offer as described in Section 2.01(b) of Exhibit"A".
1.27 Managed Hotels. Full-service hotels that are generally comparable to the Hotel that
are managed by the Operator or Owner or any entity affiliated with, controlled by, under common
control with, or controlling Operator or Owner.
1.28 Management Agreement. The Agreement between Owner and Operator (if any)
that sets forth, among other things, their respective responsibilities relating to the day-to-day
operations of the Hotel and their respective responsibilities under this Agreement.
1.29 Maximum Event Room Block. The Maximum Event Room Block is as follows:
(i) for a City-Wide Event whose first Event Night is scheduled to occur 24 calendar months or
more from the Initial Offer Date, the Maximum Event Room Block shall be 10 rooms of the
inventory of Suites plus 90 rooms of the Standard Guest Rooms or 0 Suites and 100 rooms of the
Standard Guest Rooms.
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1.30 Meeting Facilities. The rentable function space in the Hotel, together with all
circulation and support space.
1.31 Minimum Hotel Operating Standard. The operating criteria (i) meeting Kimpton
brand standards or(ii) necessary for a hotel property to receive either a Four Star rating by Forbes
Travel Guide, as more specifically outlined in Exhibit`B", attached hereto and made a part of this
Agreement for all purposes. Owner shall at no time be required to demonstrate receipt or
maintenance of such rating.
1.32 Negotiations Period. As defined in Section 2.01(g) of Exhibit "A" to this
Agreement.
1.33 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 8.02 below.
1.34 Opening. The date upon which the Hotel opens to the public.
1.35 Operator. As defined in the Recitals of this Agreement. In the event Owner enters
into a Management Agreement, 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.
1.36 Owner. Owner shall initially mean Owner as defined in the preamble to this
Agreement and any successor entity.
1.37 Party. Either the City or the Owner, the parties to this Agreement.
1.38 Parties. Both the City and the Owner,the parties to this Agreement.
1.39 Potential Convention Center Customer. A person, entity, group or association (or
any combination thereof) which is planning a City-Wide Event.
1.40 Rate Quote. Rate Quote shall have the meaning ascribed to it in Section 2.01(b) of
Exhibit "A".
1.41 Room Block Request Notice. Room Block Request Notice shall have the meaning
ascribed to it in Section 2.01(a) of Exhibit"A".
1.42 Sales Representative. Sales Representative shall have the meaning ascribed to it in
Section 2.01(a) of Exhibit"A".
1.43 Standard Guest Rooms. The Hotel's entire inventory of single-bay sleeping rooms.
As of the Effective Date, Owner expects the Hotel to contain 197 Standard Guest Rooms.
1.44 Suite. Any guest room comprised of multiple guest room bays. As of the Effective
Date, the Owner expects the Suite inventory to be comprised of29 Suites.
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1.45 Term. The Term of this Agreement shall be consistent with that set forth in Article
V below.
ARTICLE II
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, any lien, charge, encumbrance or security interest upon any
assets of the City under any agreement or instrument to which the City is a parry 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 Delaware, and is qualified to do business in the State of Texas.
(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) In the event Owner enters into a Management Agreement, Owner shall
ensure that Operator has access to sufficient working capital to perform its obligations
under this Agreement at the time Operator needs to have access to sufficient capital.
(D) 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.
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ARTICLE III
SPECIAL OBLIGATIONS OF CITY
3.01 Convention Center Requirements. The City shall own, operate and maintain the
Convention Center in a manner consistent with the operation and condition of Competing
Convention Center Facilities. If the City fails to maintain and operate the Convention Center in
accordance with the foregoing requirement, the remedies set forth in Article VI will be available
to Owner. City staff will request funding on an annual basis for the purpose of maintaining and
improving the facility. Improvements to the Convention Center will include,but not be limited to,
the purchase of new furnishings, fixtures and equipment as needed to keep the Convention Center
in a marketable condition. In order to maintain consistency and accountability, City shall not
assign this contract and the obligations listed herein to any other entity. The City agrees to price
the Convention Center space competitively with Competing Convention Center Facilities and, in
accordance with Section 8.09, the City further agrees to meet with the Owner from time-to-time
upon Owner's request to consider bids that are competitive with convention center facilities in the
non-public sector such as the Gaylord Texan Resort and Convention Center and the Sheraton Hotel
(Dallas).
3.02 Records. The City shall keep reasonable and accurate records relating to events
held at the Convention Center. Upon request of Owner,Director must submit to Owner a summary
of all applicable and actual potential bookings at the Convention Center in a manner that would
enable a reasonable person to readily determine the future demand for rooms inventory at the
Hotel.
3.03 Hotel Use of Convention Center Space. The parties acknowledge that the Hotel
may book certain events which are outside the scope of this Agreement but nevertheless require
the use of certain Convention Center space. In that regard, the City agrees to cooperate with the
Hotel in providing Convention Center space to the Hotel,when space is available,following City's
booking guidelines and at the established rates approved by the City Council.
ARTICLE IV
SPECIAL OBLIGATIONS OF OWNER AND OPERATOR
4.01 Records. Owner shall keep reasonable and accurate records relating to the
provision of services provided hereunder. Owner shall prepare and submit to the Director, with a
copy to the CVB, 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 the future rooms inventory at the Hotel available to the City under this Agreement.
4.02 Hotel Standards.
(A) To the extent Owner is operating the Hotel and this Agreement remains in
effect, Owner agrees to do so in accordance with the Minimum Hotel Operating Standard
for a period of ten(10) years from the date that Owner first opens the Hotel for business to
the public. After such 10-year period, Owner's obligation to operate and maintain the
Hotel in accordance with the Minimum Hotel Operating Standard shall continue only so
long as the Convention Center is operated and maintained at a level sufficient to support a
hotel operating in accordance with the Minimum Hotel Operating Standard and the City of
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Fort Worth continues to be a desirable convention and business destination that makes it
economically feasible to operate the Hotel at the Minimum Hotel Operating Standard
(collectively, the "Convention Center Requirements"). If the City determines in its
reasonable judgment that the Hotel is not being operated in accordance with the Minimum
Hotel Operating Standard as required by this Section 4.02(a),the City shall deliver written
notice to Owner specifically setting forth the basis of the City's determination. If Owner
disagrees with the City's determination or, after the expiration of the 10-year period, if
Owner believes that the Convention Center Requirements have not been satisfied so as to
obviate the requirement that the Hotel be operated at the Minimum Hotel Operating
Standard, Owner shall submit the matter to arbitration for resolution in accordance with
Section 6.04 hereof. If Owner fails to respond to the City's notice within ten(10)days after
receipt, Owner will be deemed to have disagreed with the City's determination and the City
shall submit the matter to arbitration for resolution in accordance with Section 6.04. Owner
will have one (1) year after receipt of such notice (or after the arbitrator''s final ruling, as
applicable) to bring the Hotel up to the standards required to meet the Minimum Hotel
Operating Standard. Owner shall deliver written notice to the City once Owner believes
the Hotel has resumed operations in accordance with the Minimum Hotel Operating
Standard. If the City does not agree with Owner's determination that Owner has resumed
operating the Hotel in accordance with the Minimum Hotel Operating Standard, the City
shall submit the matter to arbitration in accordance with Section 6.04 hereof within fifteen
(15) days after receipt of such written notice from Owner. If Owner does not bring the
Hotel to the Minimum Hotel Operating Standard within the required time period, then, as
the City's sole and exclusive remedy, (i) if Owner's failure to resume operations in
accordance with the Minimum Hotel Operating Standard occurs during the period the
Economic Development Agreement and the Tax Abatement Agreement are in force, the
City will have the rights available under the Economic Development Agreement and the
Tax Abatement Agreement, or (ii) if Owner's failure to resume operations in accordance
with the Minimum Hotel Operating Standard occurs after the Economic Development
Agreement and Tax Abatement Agreement have expired,the City will be entitled to actual
damages as determined by an arbitrator appointed in accordance with Section 6.04 hereof,
provided that the City must use its best efforts to mitigate any damages the City may suffer
as a result of the Hotel not being operated in accordance with the Minimum Hotel
Operating Standard. Notwithstanding anything to the contrary set forth in this Agreement,
Owner will not have any obligation(express or implied)to continuously operate the Hotel
during the Term.
(B) The Hotel shall be branded as the Kimpton Fort Worth Hotel so long as
Owner owns the Hotel. If Owner sells the Hotel, the Hotel may be branded as any other
hotel so long as it is operated in accordance with the terms of this Agreement.
(C) Notwithstanding the foregoing, for so long as Owner operates the Hotel in
accordance with Kimpton Brand Standards, as defined in the License Agreement (the
"Kimpton Agreement") between Owner and IHG Franchising, LLC, Owner shall be
deemed to meet the Minimum Hotel Operating Standard.
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
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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 (if applicable) shall cause Operator to comply with all obligations
of Owner that are set forth in Exhibit"A" which is attached hereto and hereby made a part of this
Agreement for all purposes.
ARTICLE V
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 Expiration of the Term of this Agreement. The Term shall expire on the loth
anniversary of the Hotel's opening date, as recognized under the Kimpton Agreement.
5.03 Periodic Renovation/Restoration of Hotel and Convention Center. Upon at least 24
months' written notice from one Party to the other, Owner shall determine a schedule by which
Owner may close portions of the Hotel as and when required or advisable under the Kimpton
Agreement, and City may close portions of the Convention Center for renovation and restoration.
Except in the event of a casualty loss or a hazard to the public health,the Convention Center shall
not be closed in its entirety and no more than three (3) floors of the Hotel shall be closed at one
time. The Parties agree that during renovation or restoration of the Hotel, the number of rooms
which are subject to this Agreement shall be proportionately reduced based on the number of
rooms being renovated or restored. During such renovation or restoration, all reasonable efforts
shall be made by each party to minimize disruption of events that are already booked at the
Convention Center or recurring events at the Convention Center that the Parties anticipate are
likely to be booked.
ARTICLE VI
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"). 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, as its sole and exclusive remedies, to either (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)recover from the defaulting
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party for actual(but not punitive,special or consequential)damages. As to a Party's right to obtain
specific performance under this Agreement, each Party acknowledges and agrees that its
covenants, obligations and representations as set forth in this Agreement are a material and
fundamental inducement to the other Party's agreement to enter into this Agreement such that
actual damages may not be an adequate remedy at law for the breach hereof and each Party
recognizes and agrees that monetary damages could not be calculated to compensate the
non-defaulting Party for any material breach by the defaulting Party of the covenants and
agreements contained in this Agreement.
Owner agrees to include in each Management Agreement a provision similar to the
foregoing whereby the Operator makes such agreements to Owner with respect hereto and
specifically agrees that the terms and conditions of this Agreement shall be incorporated as part of
the terms and conditions of the Management Agreement; that the terms and conditions of this
Agreement shall control in the event that there are any conflicting provisions in such Management
Agreement; and that the City shall have the right to specifically enforce against the Operator the
provisions of this Agreement.
In addition, upon a finding by an arbitrator that Owner has committed a third Event of
Default relating to Owner's willful failure to set aside rooms, and provided Owner did not cure the
two prior Events of Default as provided in Section 6.01 above, then City will have the right to
terminate this Agreement and the Economic Development Agreement,whereupon all further rights
and obligations of the City and Owner under this Agreement and the Economic Development
Agreement shall cease and be of no further force or effect. For purposes of this paragraph, each
time Owner materially breaches any of the terms, conditions or covenants contained herein and
fails to remedy same as set forth in Section 6.01 above shall be deemed a separate Event of Default.
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.
6.04 Arbitration.
(A) If the parties are in disagreement regarding any provision of this Agreement,
the parties shall submit disputes to mandatory arbitration in accordance with the provisions
of this Section 6.04. Each of the City and Owner waives the right to commence an action
in connection with this Agreement in any court and expressly agrees to be bound by the
decision of the arbitrator determined in this Section 6.04;provided, however,the waiver in
this Section 6.04 will not prevent the City or Owner from commencing an action in any
court for the sole purposes of enforcing the obligation of the other party to submit to
binding arbitration or the enforcement of an award granted by arbitration herein. Any
dispute between the City and Owner as to the interpretation of any provision of this
Agreement or the rights and obligations of any party hereunder shall be resolved through
binding arbitration as hereinafter provided in Fort Worth, Texas. Notwithstanding the
foregoing, prior to submitting any dispute hereunder to arbitration, the City and Owner
shall first attempt in good faith, for thirty (30) days after the first notice given under this
Agreement regarding such dispute, to resolve any such dispute promptly by negotiation
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between executives of each party who have authority to settle the dispute, which shall
include an in person meeting between such executives in Fort Worth, Texas.
(B) If arbitration is required to resolve a dispute between the City and Owner,
the City and Owner shall agree upon one(1)arbitrator to resolve the dispute. The arbitrator
must be a neutral party having at least five (5) years experience in commercial real estate
in general and hotel buildings in particular in the Fort Worth, Texas area and must be
mutually acceptable to both parties.
(C) The arbitrator selected pursuant to Section 6.04(B) above will establish the
rules for proceeding with the arbitration of the dispute, which will be binding upon all
parties to the arbitration proceeding. The arbitrator may use the rules of the American
Arbitration Association for commercial arbitration but is encouraged to adopt the rules the
arbitrator deems appropriate to accomplish the arbitration in the quickest and least
expensive manner possible. Accordingly, the arbitrator may (1) dispense with any formal
rules of evidence and allow hearsay testimony so as to limit the number of witnesses
required, (2) minimize discovery procedures as the arbitrator deems appropriate, and (3)
limit the time for presentation of any party's case as well as the amount of information or
number of witnesses to be presented in connection with any hearing. In any event, the
arbitrator (A) shall permit each side no more than two (2) depositions (including any
deposition of experts), which depositions may not exceed four (4) hours each, one set of
10 interrogatories (inclusive of sub-parts) and one set of five (5) document requests
(inclusive of sub-parts), (B) shall not permit any requests for admissions, (C) shall limit
the hearing, if any, to two (2) days, and (D) shall render his or her decision within sixty
(60) days of the filing of the arbitration.
(D) The arbitrator will have the exclusive authority to determine and award
costs of arbitration and the costs incurred by any party for its attorneys, advisors and
consultants.
(E) Any award made by the arbitrator shall be binding on the City, Owner and
all parties to the arbitration and shall be enforceable to the fullest extent of the law.
(F) In reaching any determination or award, the arbitrator will apply the laws
of the state in which the Hotel is located. Except as permitted under Section 6.04(D)above,
the arbitrator's award will be limited to actual damages and will not include consequential,
special, punitive or exemplary damages. Nothing contained in this Agreement will be
deemed to give the arbitrator any authority,power or right to alter, change, amend,modify,
add to or subtract from any of the provisions of this Agreement. All privileges under state
and federal law, including, without limitation, attorney-client, work product and party
communication privileges,shall be preserved and protected. All experts engaged by a party
must be disclosed to the other party within fourteen (14) days after the date of notice and
demand for arbitration is given.
6.05 Injunctive/Ancillary/Emergency Injunctive/Ancillary/Emergency Relief. Notwithstanding any provision of Section
6.04 of this Agreement to the contrary, any party may seek injunctive relief or other form of
ancillary relief at any time from any court of competent jurisdiction in Tarrant County, Texas. In
the event that a dispute or controversy requires emergency relief before the matter may be resolved
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under the arbitration procedures of Section 6.04 above, notwithstanding the fact that any court of
competent jurisdiction may enter an order providing for injunctive or other form of ancillary relief,
the parties expressly agree that such arbitration procedures will still govern the ultimate resolution
of that portion of the dispute or controversy not resolved pursuant to said court order.
ARTICLE VII
NO LIABILITY FOR POTENTIAL 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. In the event Owner has entered into a
Management Agreement, 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. Furthermore, Operator shall be directly responsible to the
City for the performance of the Operator's obligations hereunder, and all actions, consents,
decisions, elections, offers, and determinations made hereunder by the Operator shall be binding
upon both Owner and Operator for purposes of this Agreement.
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 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 VIII
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
1201 Houston St.
Fort Worth, TX 76102
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with copies to: both the City Manager and the City Attorney,
each at: City of Fort Worth
200 Texas St.
Fort Worth, TX 76102
OWNER: Gary Prosterman
K Main Hotel, LLC
40 S. Main Street
Suite 2200
Memphis, TN 38103
with copies to: Baker Donelson
Attn: Mary Ann Jackson
First Tennessee Building
165 Madison Avenue
Suite 2000
Memphis, Tennessee 38103
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 Fort Worth 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. Owner may assign its rights, duties and obligations
under this Agreement without the consent of the City so long as such assignee or successor to
Owner assumes all the covenants and obligations of Owner under this Agreement in writing, as
further provided in Section 8.11 of this Agreement. Upon any such assignment and assumption,
Owner shall be relieved from all liability under 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
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
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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 unreasonably 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. In addition,the Parties
acknowledge and agree that the successful operation of the Convention Center and the Hotel will
be greatly affected by the future cooperation between the City and Owner. As an example, in the
event the Super Bowl is awarded to the proposed Dallas Cowboys stadium in Arlington, City
acknowledges the potential need by Owner to block rooms for the event, and that any events held
in the Convention Center during that period would possibly need to be local in nature. The parties
hereby agree to maintain a course of dealing with one another based on a high level of cooperation,
integration and harmony between the Convention Center and the Hotel. In that regard, the Parties
agree that representatives of the Hotel,the Convention Center and the CVB will meet on a not less
than quarterly basis to share information with respect to the ongoing and future operation of the
Convention Center and the Hotel in an effort to provide the level of cooperation that will lead to
the success of both the Convention Center and Hotel. In addition, the parties acknowledge that
the rights and the obligations of the Parties under this Agreement may need to be modified from
time to time to conform to the then current industry standards. Each party agrees to be reasonable
in connection with any request by the other to revisit provisions of this Agreement which may no
longer comport with the then current industry standards, including pricing of both Hotel rooms
and Convention Center meeting space. City and Owner agree to deliver to each other on at least
an annual basis with their capital improvement plans for the Convention Center and Hotel,
respectively, and allow the other party to review and comment on same.
8.10 Enforcement. The City Attorney or his or her designee may enforce all legal rights
and obligations under this Agreement, on behalf of City. The Owner shall provide to the City
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Attorney all documents and records that the City Attorney reasonably 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,or obligations of Owner under the Kimpton
Agreement. Owner may seek and enforce a protective order against disclosure of privileged or
confidential information that would not be discoverable under applicable law.
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 or Hotel Site (if any) (other than a collateral assignment to
secure a debt of Owner) to a successor in interest, 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 or any Operator from
performing the obligations of the Owner and Operator 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 provide 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 Estoppel Certificate. Within twenty (20) days after receipt of written request
therefor by another Party hereto, the other Party shall execute and deliver to the requesting Party
(and to such other person as the requesting Party may designate) a statement reasonably
satisfactory to the requesting Party certifying any facts that this Agreement is unmodified and is
in full force and effect (or if there have been modifications, stating that this Agreement is in full
force and effect as modified), that the requesting Party is not in default hereunder (or stating the
nature of any alleged default), that there are no defenses or offsets to the Agreement claimed by
the other Party, and further certifying any matters reasonably requested by the requesting Party.
A failure by a Party to execute, acknowledge and deliver upon request the certified statement
described above within twenty (20) days from receipt of such request shall constitute
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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 that no default by the
requesting Party exists hereunder. Notwithstanding anything to the contrary set forth in this
Section 8.16, neither Party will be required to execute such an estoppel certificate more often than
two (2)times in any twelve (12)-month period.
8.17 Superiority of Agreement. The provisions of this Agreement shall constitute a
restrictive covenant running with the Hotel Site binding upon each owner thereof, and any and all
Operators or managers of the improvements thereon, and each and every other person or entity
claiming or holding any interest in the Hotel Site, shall inure to the benefit of the City, and shall
apply to any hotel now or hereafter located on the Hotel Site, or any portion thereof, but only so
long as this Agreement is in effect.
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.
8.19 Casualty. In the event of a casualty loss to the Hotel which causes all or a portion
of the Hotel to close pending repair or reconstruction, any failure by Owner to perform its
obligations hereunder as a direct result thereof shall be waived until such time as the damage has
been repaired, provided Owner agrees to use commercially reasonable and diligent efforts to
effectuate such repair.
8.20 Memorandum of Agreement. Owner and City shall execute for recordation in the
Real Property Records of Tarrant County,Texas a memorandum of this Agreement in substantially
the form of Exhibit "C" attached hereto. At the request of either party, and provided the Term of
this Agreement has expired or this Agreement has otherwise terminated, the other party shall
execute and deliver for recordation in the Real Property Records of Tarrant County, Texas a
termination memorandum evidencing a release of the Hotel Site of any encumbrance under this
Agreement.
[EXECUTION PAGES FOLLOW]
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EXECUTED as of the last date indicated below:
CITY OF FORT WORTH: 714 MAIN REAL ESTATE HOLDINGS,
LLC, a Delaware limited liability company
By: By:_
usan lams Gary rosterman
Assistant City Manager Authorized Person
Date: (01 +f a-v i l
APPROVED AS TO FORM AND LEGALITY:
k.F0R
By: > A by:
Peter Vaky t
Deputy City Attorney '
M&C: C-28913 10-30-18 J. Ka r, ity ecretary � P '
OFFICIAL RECORD
CITY SECRETARY
- 16 -
FT. WORTH,TX
STATE OF --5-- §
COUNTY OF Skc �'`r §
BEFORE ME, the undersigned authority, a otary Public in and for the State of
Tennessee, on this day personally appeared of 714 Main Real
Estate Holdings, LLC, the known to me to be Itperson whose name is subscribed to the
foregoing instrument, and acknowledged to me that the same was the act of 714 Main Real
Estate Holdings, LLCand that s/he executed the same as the act of for the purposes and
consideration therein expressed and in the capacity therein stated. n
GIVEN UNDER MY HA'� AND SEAL OF OFFICE this UJkay of /"I
STATE• .
OF
••`�'� otary ublic in and for the State of
TENNESSEE
• NOTARY
?<•pG. PUBW •Q3. N
�p .�;1. 5���.�o'L
STATE OF TEXAS '0IP'M�RC�-\4)e
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas,
on this day personally appeared, known to me to be the person whose name is subscribed to the
foregoing instrument, and acknowledged to me that the same was the act of the City of Fort
Worth and that he executed the same as the act of the City of Fort Worth for the purposes and
consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this_day of
Notary Public in and for the State of Texas
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH,TX
- 17 -
STATE OF §
COUNTY OF §
BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on
this day personally appeared of K Main Hotel, LLC, the known
to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged
to me that the same was the act of K Main Hotel, LLC and that s/he executed the same as the act
of for the purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of
Notary Public in and for the State of
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on
this day personally appeared Susan Alanis, known to me to be the person whose name is
subscribed to the foregoing instrument, and acknowledged to me that the same was the act of the
City of Fort Worth and that she executed the same as the act of the City of Fort Worth for the
purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this-4-day of
MARIA S.SANCHEZ
r
'+ = My Notary ID#2256490
N ary Public in and .for the State o Texas
Expires December 19,2021
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH,TX
- 17 -
EXHIBIT "A"
SECTION I
SERVICES
1.01 Services. The Owner, shall provide convention room block services in accordance
with this Exhibit"A".
SECTION II
COMMITMENT TO PROVIDE CONVENTION ROOM BLOCK SERVICES
2.01 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. The right to require that the
Owner/Operator so offer the Event Room Block will be exercised in accordance with the
procedures outlined below.
(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
Owner/Operator that a Potential Convention Center Customer is seeking offers from local hotels
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 or CVB), (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 Owner/Operator in the same
manner as such notifications are customarily communicated to other, hotels by the Sales
Representative.
(b) Unless the deadline is specifically extended in writing by the Sales Representative,
within ten (10)Business Days after Owner/Operator's receipt of the Room Block Request Notice,
the Owner/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 Owner/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 actual number of
the guest rooms in the Room Block Request Notice for each specific date, 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 "RateQuote"). The amount of the Rate Quote in
the Initial Offer will be at the Owner/Operator's sole discretion and Owner/Operator will make a
quote which is reasonably consistent with the then current economic climate,the demand for rooms
during the relevant Event Nights and the rates then being charged by other comparable downtown
Fort Worth hotels, taking into account reasonable differences in quality, amenities, location and
suitability. In all respects, the Initial Offer shall be structured in accordance with
Exhibit"A"—Page 1
Owner/Operator's normal booking policies as described in Section 2.01(e) below.
(c) After reviewing the Initial Offer, the Sales Representative may consult with the
Owner/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 Owner/Operator to offer the Potential Convention
Center Customer an alternative rate structure, the City or CVB may, after consultation with the
Owner/Operator and within the ninety (90) calendar day timeframe, elect to ask Owner/Operator
to consider (which election shall be communicated by Notice from the Director or the CVB to the
Owner/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 Owner/Operator of such notice
from the City or CVB, Owner/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, which response shall be in Owner's sole
and absolute discretion.
(d) If, pursuant to Section 2.01(c) of this Exhibit"A", Owner/Operator agrees to offer
the Potential Convention Center Customer a rate lower than the rate in the Initial Offer,
Owner/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 Owner/Operator's written response to the City's and/or the CVB's request under Section
2.01 c of this Exhibit "A".
(e) In negotiating a Binding Contract, Owner/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 Owner/Operator at its Managed Hotels or otherwise be consistent with
local market practices 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(150) calendar days from the date the Current Offer is received
to (i) verbally accept the Current Offer and (ii) negotiate and execute a Binding Contract. (The
term"Current Offer"is defined as the most recent of either the Initial Offer or the Amended Offer.)
Upon verbal acceptance of the Current Offer, Owner/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
Owner/Operator within one hundred fifty(150)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 Owner/Operator shall consider the Event
Exhibit"A"—Page 2
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 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 Negotiations Period, Owner/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 Owner/Operator notifies First Customer, in writing, of such
acceleration. Owner/Operator's ability to accelerate the Current Offer expiration date is
acknowledged by the parties to be part of the Owner/Operator's customary booking policies.
(h) 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 Owner/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 City
may require that Operator extend the rooms to another Potential Convention Center Customer in
accordance with the provisions hereof. The City recognizes that under the Owner/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/Operator. 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 agrees 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.
(i) Owner/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(301h)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, Owner/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, Owner/Operator shall not waive any
cancellation rights to which the Hotel may be entitled. (Under this Section 2.0tw, the term,
Exhibit"A"—Page 3
"booked,"means there is a room reservation on file that is 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 Owner/Operator, shall have the right to only block such number or rooms which
Owner/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 Owner/Operator actually is not adequate to satisfy the actual use
of rooms by the Potential Convention Center Customer.
0) There are two categories of inventory that, under this Agreement, may be reserved
by Owner/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 Owner/Operator may, at its discretion, take reservations for up to the amount
of the Exempt Inventory for any given day in the future. The Exempt Inventory is a total of 97
rooms and 29 suites.The second category is inventory that has not been reserved under this
Agreement as of any date that is less than)thirty-six (36) months from the start of any City-Wide
Event. Any room inventory meeting these criteria shall be available for rental by the
Owner/Operator without restrictions imposed by this Agreement.
(k) Notwithstanding anything to the contrary set forth in this Agreement
Owner/Operator shall have the right to request a reduction of the rooms required to be reserved by
Owner herein up to two (2) times per calendar year (that is to say, Owner/Operator may request
the right to book rooms during City-Wide Events in a manner which would not allow
Owner/Operator to satisfy the Maximum Event Room Block twice during any calendar year during
the term of this Agreement). Within ten (10) days after receipt of such written request from
Owner/Operator, the City shall either approve or disapprove such request, but the City's approval
shall not be unreasonably withheld, conditioned or delayed. If the City does not respond in writing
within such ten (10) day period, Owner shall send a second written notice to the City. If the City
fails to respond in writing within five (5) days after receipt of such second notice, the City will be
deemed to have approved such request. In addition, if Owner/Operator receives a request for a
room block from a prospective group more than thirty-six (36) calendar months prior to such
groups'first night stay at the Hotel, Owner/Operator shall have the right to request the City to grant
relief from this Agreement with respect to the Maximum Event Room Block and the City must be
reasonable in considering such request from Owner/Operator.
(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 Owner/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 includes a reasonable and
specific basis for the Owner/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.
2.02 Confidentiality. Subject to its obligations under applicable law, the City or CVB
will not disclose any Initial Offer or Amended Offer to any person or entity other than its
Exhibit"A"—Page 4
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. Confidentiality issues may be subject to Texas Open
Records laws.
SECTION III
OTHER COOPERATIVE PROGRAMS
3.01 Cooperative Advertising. The Owner, at no cost to the City, will cooperate with
the City and or the CVB in connection with joint marketing efforts directed by the City/CVB, at a
cost comparable to other hotels of similar size.
3.02 Site Selection Assistance. The Owner,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 planners
conducting site visits and or participating in familiarization trips.
Exhibit"A"—Page 5
EXHIBIT "B"
Exhibit`B"—FORBES TRAVEL GUIDE FOUR-STAR RATING
Rating Criteria: Lodging
They Star Rating Process
The Forbes Travel Guide process of rating each establishment includes:
• Facility inspection: Every property is visited by a trained facility inspector,
who uses a checklist to evaluate cleanliness,physical condition and location.
This inspection is unannounced and results in a Forbes One,Two or Three Star
rating. Spas are the only exception--the minimum standard for a Forbes spa
rating is three stars.
• Service evaluation: Based on the facility inspection, properties that might
qualify for a Forbes Four Star or Five Star Award certification will receive a
visit from a second,this time,incognito inspector.This inspector makes an
anonymous visit and performs an incognito evaluation based on more than
550 service standards. During service evaluations, inspectors behave as regular
guests and never reveal that they represent the Forbes Travel Guide. This
inspection largely focuses on the guest experience and the consistency in
service, not just the physical facilities and amenities.
Only facilities that meet the Forbes Travel Guides rigorous standards are rated and
listed in both the travel guides and on the website. Deteriorating, poorly managed
establishments are deleted.A Forbes Travel Guide listing and review constitutes a
positive quality recommendation; every listing is an accolade, recognition of
achievement.
Star DeB nit ions
*+ ,,klFive Star Hotels: These exceptional properties provide a memorable
experience through virtually flawless service and the finest of amenities. Staff are
intuitive, engaging and passionate, and eagerly deliver service above and beyond the
guests' expectations. The hotel was designed with the guest's comfort in mind, with
particular attention paid to craftsmanship and quality of product. A Five Star property is a
destination-unto itself.
**Four Star Hotels: These properties provide a distinctive setting, and the guest
will find many interesting and inviting elements to enjoy throughout the property.
Attention to detail is prominent throughout the property, from design concept to quality
of products provided. Staff are accommodating and take pride in catering to the guest's
specific needs throughout their stay.
-' ' Three Star Hotels: These well-appointed establishments have enhanced amenities
that provide travelers with a strong sense of location, whether for style or function. They
may have a distinguishing style and ambience in both the public spaces and guest rooms;
or they may be more focused on functionality,providing guests with easy access to local
events, meetings or tourism highlights.
**Two Star Hotels: The Two Star hotel is considered a clean, comfortable and reliable
establishment that has expanded amenities, such as a full-service restaurant.
_One Star Hotels: The One Star lodging is a limited-service hotel or inn that is
considered a clean, comfortable and reliable establishment.
F,arhes Star Rating Criteria & Expectations - 11,odgh-Lig
Thefollowing are suggested criteria of what a guest can expect at each star level. They
are not individually mandated and are a representative sampling of the hundreds of
points covered during our inspection process.Additionally, at each star level the
lodging establishment is required to meet or exceed the requirements of the previous
star rating. For example, a Three Star hotel meets the criteria expectations of a Three
Star hotel, a Two Star hotel and One Star hotel, and so forth.
*One Star Hotels: Clean, comfortable and reliable establishments providing travelers
with limited sei vices and basic amenities. These properties focus on providing a value
experience while meeting traveler's expectations.Most hotels do not have a fiill-service
restaurant or dining room. Many Hampton Inns and Fairfield Inns consistently earn a
Forbes One Star rating.
Characteristics of a One Star Hotel,Motel or Inn include:
Services Detail
-Staff is well-groomed with professional, neat and well-maintained attire.
-All staff encountered are pleasant and professional in their demeanor.
-Coffee, hot tea and breakfast pastry are available on-site (could be in-room).
Facilities Detail
- Self parking area is free of debris, good condition; surfaces, curbs, paths.
-All outdoor walkways and approaches are well-maintained and cleaned.
-Outdoor awnings, signs, marquees, flags, and plantings are clean and in good
condition.
- Public spaces are free of obvious hazards.
-Lobby floors, walls and ceiling are free of debris, marks and damage.
-Elevator landings, cars and doors/tracks are clean and in good condition.
-Guest room corridor floors,walls and ceilings are free of debris, marks, and damage.
-Vending and/or ice machines are located within one floor of guest room.
-Vending and/or ice areas and equipment are clean, well-lit, and well-maintained.
-All furniture,fixtures and equipment are clean, neat and well-maintained.
-Ashtrays throughout public areas are well-maintained and free of excessive debris.
Temperature in all interior public areas are maintained in general comfort range.
-If public phonebook present,it is neat and in good condition.
- Public washrooms very hygienic and neat,with well-stocked paper and soap.
-Public washroom fixtures,walls and floors are in very good condition.
-Guest rooms are equipped with direct dial phones.
Guest Room Detail
-Hardware and hangings (door locks,racks, artwork, etc.) are secure and in good
condition.
-Carpet/floor is free of debris, stains,wear,loose threads, open seams, etc.
-Walls and ceilings are free of marks, stains and damage.
-Drapes are free of stains, damage; pull easily and hang properly.
-Furniture is free of dust,marks and damage.
-All printed material including collateral,phonebooks and stationery are neat, crisp and
current.
-Drawers and shelves are clean,free of dust and debris.
-All light bulbs operate; all light fixtures and lamps are in good condition, clean.
-Mirrors and windows are free of smudges and damage throughout.
-If safe is provided, it is clean, functional and convenient.
-Guest rooms are equipped with data ports (guest can connect laptop to the Internet).
-Room equipped with accurate, functional clock and radio/stereo.
-Color television works and is equipped with remote control.
-Televisions will feature basic cable or satellite channels.
-Telephones are available in each guest room.
-Ice bucket and glasses (may be molded plastic) are clean, hygienic.
-If minibar is present, it is hygienic, free of spills and damage, all products are sealed,
price list present.
-If coffeemaker is present, it is hygienic, contains ample, sealed supplies and cups.
-All bedding and linens are free of debris,hairs, damage and stains.
-Room heating and air conditioning is easily controlled by guest and is quiet.
-Air is fresh and clean,no stuffiness or odors.
-Sink,tub, shower,toilet,bidet are very clean,free of hairs,stains and discoloration.
-Bathroom tile and grouting is clean,not discolored, cracked or mildewed.
-Faucets and drains operate smoothly and easily.
- Hygienic soap and shampoo is provided.
-Minimum bath linen is present: one bathmat;two each of facecloth,hand towel and
bath towel.
-Towels are free of spots, stains,tears and obvious frays.
-If robes are provided, they are free of spots, stains and loose threads.
Specialized Facility Detail
-Pool/beach furniture is clean, hygienic and well-maintained.
-Pool deck or beach/sand is clean and free of excessive debris.
-Pool deck and tiling are in good condition,free of excessive damage or wear.
-Pool water is clean,free of debris and free of notable odors.
-Pool fittings and equipment (ladders, dive boards)are secure and in good condition.
-Tennis court surfaces are in good condition,free of damage and well-marked.
-Tennis courts and surrounding areas are clean and free of debris.
- Fixtures,nets,lights, and fences are well-maintained and good condition.
**Two Star Hotels: Comfortable establishment that is clean and reliable with
expanded amenities and services that include a full-service restaurant on site. The hotel
decor, furnishings, amenities,property grounds and guest room design will be moderately
enhanced in quality.Doubletree Hotels, Courtyard by Marriott and Four Points by
Sheraton are well-established names in the Forbes Two Star category.
A Two Star Hotel,Resort or Inn meets all the criteria expectations and all of the
qualities for a One Star Hotel,Resort or Inn plus the following characteristics:
Services Detail
-Front desk staff are articulate, smile and make eye contact.
-Staff is attired in well-fitting, consistent uniforms.
-Baggage assistance is available on request.
-The front desk is staffed twenty-four hours.
-Restaurant on-site serves three meals daily.
-If Inn, twenty-four hour guest service available on-call
Facilities Detail
-Lobby provides a comfortable seating area.
-Signs and notices are professional, matching decor, not "handwritten".
-Vending and/or ice machines are located on each guest floor.
- Service doors are clean,free of marks and damage,and closed.
-Public phones are convenient, clean and well-maintained.
-A variety of different sized and appointed rooms are available in hotel.
-If available, meeting rooms are well-signed so that it is easy to find and arrive at a
specific room.
-If available,meeting room doors are in good condition, free of nicks and damage.
-If available,meeting room interiors are in generally good condition, including walls,
floors and ceiling.
Guest Room Detail
-Guest room door and frame are free of marks, scratches and scuffs.
-There is comfortable seating for two people (other than bed).
-Guest service directory,pad and pen/pencil present and conveniently placed.
-Enclosed closets (means closets must have doors).
-There are a minimum six non-captive hangers.
-There are three spacious drawers or enclosed shelves (inside closet).
-A Luggage rack or bench provided; and adequate space to leave suitcase.
-Extra clean and hygienic blanket and pillow are provided in room.
-Lighting throughout the room is adequate.
-The room can be fully darkened.
-A full-length mirror is present in room.
-A hairdryer present in room, clean and functional.
-Hygienic soap, shampoo and two other bath amenities are provided.
-Guest rooms are equipped with easily accessible data ports or Ethernet/wireless
internet access.
Specialized Facility Detail
-Guest can pick up e-mail and access the Internet from a Business Center workstation.
- Business Center working areas are clean,tidy and professional.
-There are comfortable office-style chairs at the Business Center guest workstations.
-All fitness,treatment and relaxation areas are hygienic, neatly organized and
maintained.
-Fitness equipment is clean, in very good condition, and conveniently laid out.
-Fitness/workout area is well-ventilated,with comfortable temperature.
-Sound system or television is provided in fitness/workout areas.
-Towels are provided in locker and fitness areas.
-Grooming area is equipped with hairdryers; soap and shampoo conveniently placed
-All amenities are neatly and professionally presented, and are very hygienic.
-Locker room, showers, sauna and hot tub are extremely clean, and hygienic in
appearance.
- Floors throughout the casino are well-maintained and free of excessive debris.
-Air circulation in casino is adequate,not stuffy or smoky.
-Slot banks are free of excessive debris, soiled glassware, and soiled ashtrays.
-Slot chairs are in good condition, clean and free of rips and stains.
-Cashier and change booths are tidy,well-organized, and well-signed.
-Table game tops are well maintained,free of damage and wear.
Three Star Hotels: Well-appointed establishment with consistent service and
enhanced amenities providing travelers with an elevated level of comfort and
convenience. Hotels will provide such services as, room service, fitness center and
optional turndown service. Hotels will have a distinguishing style and ambience with
both the public space and guest rooms.Many Hyatt,Hilton, Marriott,Westin and
Fairmont hotels are established names with consistent service in the Forbes Three Star
category.
A Three Star Hotel,Resort or Inn meets all the criteria expectations and all of the
qualities for a Two Star Hotel,Resort or Inn plus the following characteristics:
Services Detail
-Confirmation number provided during reservation service.
- Reservationist can give clear and vivid description of hotel facility and style.
-Turndown service is available upon request.
-Valet parking is available.
-Baggage assistance is automatic.
-Same day laundry and dry cleaning available five days/week.
-Complimentary newspapers are delivered to room automatically.
-Complete room service is available.
-Workstation is available where guest can access Internet.
-Basic fitness equipment is provided, including treadmills and cycles.
-If Inn, restaurant on-site which serves full breakfast is available and one additional
meal service.
-If Resort, complimentary newspapers (or newsfaxes) are delivered to room
automatically.
Facilities Detail
-High quality,varied, and major brand sundry selections are available in an on-site
store.
-If public phonebook present, it is displayed in attractive cover.
-Pay-per-view movies are available.
-Suite accommodations (separate bedroom and living areas) are available.
Guest Room Detail
- Each guest room has two phones (one could be in the bathroom).
-Comfortable desk and chair are available for working, complete with telephone, data
port, and light.
-Guest rooms are equipped with Ethernet/wireless internet access.
-Insulated ice bucket,vinyl or better, as well as glass glassware; clean and hygienic are
present in room.
-Minibar is present(defined as selection several beverages and snacks).
-If Inn, refreshments present in room or readily available
-If coffeemaker is present, ceramic mugs and napkins are available.
- Pillows are plush and full, no foam.
- Framed artwork or interesting architectural features exist in room.
- Excellent lighting is provided in bathroom for makeup and shaving.
- Hygienic soap, shampoo and four other bath amenities are provided.
-Amenities are presented attractively,thoughtfully(not simply lined up on counter).
-Towels are of absorbent quality,with soft nap and no discoloration.
-If Inn, Pay-per-view movies available or VCR/DVD is available.
- If Resort, guest room provides ample seating for more than two persons.
Specialized Facility Detail
-If Business Center is present, a semi-private working area with workstation and
telephone is available for guests.
-If tennis is available on site, water is available courtside.
-If pool or beach service is present, ample towels are available poolside or at the beach.
- Pro shop/clubhouse interiors are clean and well-maintained; displays and counters
neat and tidy.
-Pro shop/clubhouse and surrounding areas are clean with well-maintained appearance.
- Golf carts are clean, well-organized and maintained.
- Rental equipment is clean and good condition, including bags.
Forbes Four and Five Stir Cr iteria and Expectations
At the Forbes Four and Five Star level,both a facility inspection and service evaluation
will be performed. For each property, more than 750 criteria including cleanliness,
physical facilities and employee attitude and courtesy, are measured and evaluated to
produce a mathematically derived score.At the Forbes Four and Five Star level, 25%
of the overall score is based on the facility inspection and 75% is based on the service
evaluation.
"Service"can seem pretty subjective,but the staff at Forbes Travel Guide use strict
standards and a good stopwatch to make their findings as accurate and objective as
possible. For hotel ratings,inspectors spend three days and two nights at the hotel,
interacting with staff, ordering room service,working out in the fitness center, making
requests with the concierge, dining in the restaurants and taking advantage of other
services that a standard guest would encounter.
Inspectors respond "yes" or"no"to standards that are classified in a way that assess
efficiency, graciousness and warmth, technical skull level as well as food quality,
housekeeping and concierge services,to name a few. For every"no" answer, a hotel loses
one point, and there's very little grey area. For example, upon arrival,luggage is
delivered to the guest's room in io minutes or guests are always asked permission before
being placed on or into a recording. It either happens or it doesn't,there's no middle
ground. Inspectors also write pages of commentary during the evaluations.
The Forbes Four and Five Star Hotel Incognito Service Evaluation
The hotel service evaluation is based on a three-day,two-night stay.The following
categories are evaluated during the stay by the Forbes incognito inspector:
• Reservations
• Arrival
• Departure
• Communications (PBX Operator)
• Room Service (Dinner)
• Breakfast Service (in Restaurant)
• Bar/Lounge Service
• Housekeeping Daily Service
• Housekeeping Request and Turndown Service
• Laundry Service
• Business Center(if applicable)
• Guest Services/Concierge (by phone and in-person)
• Guest Room Conditions
• Public Area Conditions
• Fitness Room (if applicable)
• Pool/Beach Service (if applicable)
• Casino (if applicable)
Within each category, questions are "tagged"for certain qualities/classifications.
Classifications:
• Courtesy/Manners
• Graciousness/thoughtfulness and sense of personalized service
• Efficiency
• Guest comfort&convenience
• Luxury
• Technical execution skill and knowledge
• Staff appearance
• Food quality
• Cleanliness&condition
Sample Service Questions from Hotel Incognito Evaluation
Note: All questions are answered with a YES or NO and then allow for
comments/remarks from the inspector. Also, each question has the applicable
classification tag in parentheses following the statement.
Reservations
Reservations agent can readily describe variety of rates and types; effectively enabling
choice. (Technical execution, skill &knowledge)
Staff exhibits the ability to anticipate needs; not always requiring prompting by guest.
(Graciousness/thoughtfulness and sense of personalized service)
Arrival
Arriving guests are greeted and assisted curbside within sixty seconds of arriving by car
or taxi. Exactly how long did it take? (Efficiency)Note: inspectors carry recorders that
can not only measure this particular exercise but the entire arrival process.
Orientation to the hotel is discreet and helpful, consisting of not more than four relevant
and important facts, but not delaying guests'arrival to room. (Guest comfort and
convenience)
Guest Services/Concierge
Staff maintains alert posture; no hands in pockets,folded arms; Staff avoids excessive
personal chatting amongst themselves; Staff does not smoke, drink or eat in guest view.
(Staff appearance)
When asked about restaurant recommendations, staff mentions at least three
appropriate options; describing cuisine, atmosphere and anticipates transportation and
dress code. (Technical execution skill and knowledge)
Guest Room Conditions
Would you describe the bed to be plush and inviting?Linens of exceptional quality and
comfort?Use of oversized or numerous pillows? Bedcovers elegant and stylish? (Sense of
luxury)
Would you describe this room as being extremely well maintained? (nothing broken,
worn, damaged, slow plumbing etc.) (Cleanliness and condition)
Room Service
Staff is extremely well spoken,polite and clear, avoiding slang and phrase-fragments.
(Courtesy/manners).
Hot foods are hot when served(not warm); frozen items are firm at the time of
consumption (desserts adequately protected or offered as second course delivery). (Food
quality)
l7�omhes Four Star Criteria
**Four Star Hotels: Outstanding establishment in a distinctive setting that
provides travelers with exceptional service and a luxury experience. Service and
amenities are refined and sophisticated and may include automatic turndown service,
valet parking and 24-hour room service. Ritz-Carlton, Mandarin Oriental and Four
Seasons are prominent names in the Forbes Four Star category, known for personalized
service and hospitality,in addition to luxurious accommodations. Other notable Forbes
Four Stars include the Post Ranch Inn,Canoe Bay and the Windsor Court Hotel.
A Four Star Hotel,Resort or Inn meets all the criteria expectations and all of the
qualities for a Three Star Hotel,Resort or Inn plus the following characteristics:
Services Detail
-Written confirmation is automatic or offered, either by mail,fax or e-mail.
-Written confirmation is personalized, professional and accurate; it reflects the style and
image of the property.
-Guests name is used effectively,but discreetly, as a signal of recognition.
-The time from arriving at the reception area until registration is complete does not
exceed five minutes (includes queuing).
- Bed is plush and inviting with oversized or numerous pillows.
-Bedcovers are elegant and stylish and with linens of exceptional quality and comfort.
-All written information is provided on good quality paper or pads, custom-printed or
logoed.
- Bathroom presentation and placement of amenities and linens is thoughtful, careful,
and elegant.
-Fresh ice is provided during evening service or at another time during the day.
-Turndown service is automatically provided.
- During turndown service,guest clothing is neatly handled and guest toiletries are
neatly arranged and displayed on a cloth or shelf.
- Room service is delivered within 30 minutes.
-Room service order is delivered within five minutes of quoted time.
- One hour pressing is available.
-If resort, two hour pressing available
- Same day laundry and dry cleaning is available seven days/week.
- Staff arrives in guest room to pick up clothing within ten minutes of placing request.
-Wake-up call is personalized with guest's name and time of day.
-Wake-up call is delivered within two minutes of requested time.
-Wine by the glass service will include an offer of a tasting sample.
- Special service desk identified as concierge/guest service is situated apart from
reception/front desk.
-The final bill is offered to guest for review prior to printing final receipt.
-If Inn, choice of at least two complimentary newspapers are offered on-site.
- If Inn, restaurant on site serving a full breakfast plus two additional meal services.
-If casino services are present,when playing slots for more than 20 minutes, drink
service is offered.
-If casino services are present,when playing a table game for more than 15 minutes,
drink service is offered.
Facilities Detail
- Lobby areas feature elegant live plants and/or fresh floral displays.
-A dedicated and secure luggage storage area is available.
-Public phones are equipped with seats, privacy panels and pad/pens.
-Public washrooms are furnished with upgraded materials and appointments/luxurious
design.
-Televisions feature premium cable or satellite television.
- Guest room telephones have two lines.
Guest Room Detail
-Selection of at least io hangers including a variety of bars, clips and padded.
- Closet is very well lit and generously spacious.
-In-room safe is present.
-If Inn, in-room safe is present or readily accessible on-site.
-Minibar is present, is non auto-charge, and premium products are attractively
displayed.
-Bed is triple sheeted or features washable duvets.
- Live plants are present in guest rooms.
-Shaving/makeup, lighted magnifying mirror is present.
- Double sinks or separate vanity counter are present in the bathroom.
-Ample cosmetic and toiletry storage space exists for two persons.
- Hygienic soap, shampoo and five other bath amenities are provided.
- Bathroom amenities will be exceptionally luxurious in quality and variety.
-One robe per guest is provided; plus additional towels in the bathroom.
- Luxurious bath linens, oversized towels and a bath rug are all present in the bathroom,
no plastic shower curtains.
Specialized Facility Detail
-Fitness equipment is available with personal headphones/televisions
- Current newspapers and national-title magazines are provided in fitness and locker
areas.
7 arbes Five Star Criteria
*****Five Star Hotels: Exceptionally distinctive luxury environment offering
consistently superlative,personalized service and the ultimate in amenities,make these
hotels and inns the best in the U.S. and Canada. Attention to detail and the anticipation of
every need are evident throughout this exclusive group of hotels. These hotels are
remarkable in every aspect from the plush and elegant guest room design to the
unforgettable culinary experiences. The Forbes Five Star category includes such
properties as the Peninsula Beverly Hills,the Four Seasons Hotel Chicago,the Ritz-
Carlton San Francisco and the Mandarin Oriental New York.
A Five Star Hotel,Resort or Inn meets all the criteria expectations and all of the
qualities for a Four Star Hotel,Resort or Inn plus the following characteristics:
Services Detail
- Staff is extremely well spoken, polite and clear, avoids slang and phrase-fragments.
- Staff is extremely well informed about requirements within their department.
-Overall service is flawless from initial reservation call to departure service.
- Guests are offered an escort to their rooms unless they specifically decline.
-Choice of at least two complimentary newspapers is offered and distributed.
-Welcome gift or amenity provided by management during the visit.
-Twenty-four hour room service is available, including hot food.
-Wine by the glass is presented in bottle and poured in room,for room service.
- During turndown service, something noteworthy and thoughtful is included in the
presentation.
-At least two types of premium quality snacks are automatically offered and distinctly
presented during bar and lounge service.
-All mixed drinks are presented with modified or full club service.
-Any work undertaken by the staff is handled with complete professionalism, and
returned to guests neatly, in folders or envelopes.
-If Inn, restaurant on site serving a full breakfast and dinner plus one additional meal
service.
-If pool service is available, guests are proactively greeted and escorted to their chairs,
and set-up assistance is provided or offered.
-If pool service is available, during a go minute period and in warm conditions, some
sort of complimentary refreshment is offered (for example,mineral water,fresh fruit,
water spritz).
Facilities Detail
-Public washrooms feature well-maintained cloth towels,fresh plants or flowers.
Guest Room Detail
- Guest bathroom is equipped with a telephone.
-CD player/stereo is present and functional.
-Ice bucket and glasses are high quality(glass, metal, stone etc.),with tongs which are
clean and hygienic.
-Fresh flowers are present in guest rooms.
- Separate showers are present in bathroom.
EXHIBIT "C"
MEMORANDUM OF AGREEMENT
This Memorandum of Agreement(herein,the"Memorandum")is executed by and between
the CITY OF FORT WORTH, TEXAS, a Texas home-rule city (the "CLty") and KMain Hotel,
LLC., a limited liability company organized and existing under the laws of the State of Delaware
("Owner").
RECITALS:
A. The parties hereto have made and entered into that certain Room Block and Meeting
Space Agreement (as described and defined hereinbelow).
B. The parties desire to record a Memorandum of Agreement to provide notice to third
parties of the Room Block and Meeting Space Agreement.
AGREEMENTS:
NOW, THEREFORE, the City and Owner do hereby make and enter into this
Memorandum for the purposes described above:
1. Description of Agreement. The City and Owner have made and entered into that
certain Room Block and Meeting Space Agreement (as same may be hereafter renewed or
amended, the "Agreement") dated effective as of , 2019, which Agreement sets
forth certain covenants of the City relating to the City's operation of the Convention Center located
on the land described on Exhibit "A" attached hereto and certain covenants of Owner relating to
Owner's operation of the Hotel located on the land described on Exhibit `B" attached hereto.
2. Term of Agreement. The term of the Agreement commences on the Effective Date
of the Agreement, and continues until the ninety-ninth (99th) anniversary of the Hotel's opening
for business, unless sooner terminated as provided in the Agreement.
3. Amendments. The Agreement may not be orally amended.
4. General. Nothing contained in this Memorandum shall be deemed or construed to
amend, modify, change, alter, amplify, interrupt or supersede any of the terms or provisions of the
Agreement. In the event of a conflict between the terms of the Agreement and the terms of this
Memorandum, the terms of the Agreement shall prevail and be controlling. This Memorandum
may be executed in multiple counterparts,and each counterpart shall be deemed an original hereof.
Accordingly, this Memorandum shall become binding, notwithstanding the execution of separate
originals hereof, one by each of the parties hereto. Capitalized terms used but not defined in this
Memorandum will have the definitions ascribed to such terms in the Agreement.
[The remainder of this page is intentionally left blank]
Exhibit"C"—MEMORANDUM OF AGREEMENT—Page 1
IN WITNESS WHEREOF,the parties hereto have executed this Memorandum on the dates
set forth in the acknowledgments attached hereto, but to be effective as of the day of April,
2005.
CITY:
CITY OF FORT WORTH,
a Texas home-rule city
By:
Name:
Title: City Manager
OWNER:
KMain Hotel, LLC,
a Delaware limited liability company
By:
Name:
Title:
Exhibit"C"—MEMORANDUM OF AGREEMENT—Page 2
STATE OF TEXAS §
COUNTY OF TARRANT §
This instrument was acknowledged before me on the day of ,
2019 by , the City Manager of the CITY OF FORT WORTH, TEXAS,
a Texas home-rule city, on behalf of said city.
[ SEAL]
Notary Public, State of Texas
My Commission Expires:
(Printed Name of Notary Public)
STATE OF TEXAS §
COUNTY OF §
This instrument was acknowledged before me on the day of
2019 by the
of KMain Hotel, LLC, a Delaware limited liability
company, , on behalf of said limited liability company.
[ SEAL]
Notary Public, State of Texas
My Commission Expires:
(Printed Name of Notary Public)
Exhibit"C"—MEMORANDUM OF AGREEMENT—Page 3
EXHIBIT"A"
Legal Description of Convention Center Land
Lot 1, Block 1, Fort Worth Convention Center Addition, being a replat of Section 1-R, Tarrant
County Convention Center, according to the Plat and Dedication recorded in Cabinet A, Slide
7829, Plat Records, Tarrant County, Texas.
Exhibit"A to Exhibit C"—LEGAL DESCRIPTION OF CONVENTION CENTER LAND—Page 1
EXHIBIT"B"
Location of Hotel Land
Exhibit`B to Exhibit C"—LOCATION OF HOTEL LAND—Page 1
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Official site of the City of Fort Worth,Texas
CITY COUNCIL AGENDA FORT�WURTH
COUNCIL ACTION: Approved on 10/30/2018
DATE: 10/30/2018REFERENCE NO.:C-28913 LOG NAME: 17ED714MAINEDPA
CODE: C TYPE: NON-CONSENT PUBLIC HEARING: NO
SUBJECT. Authorize Execution of Economic Development Program Agreement with Development
Services Group, Inc.,or an Affiliate for the Development of a Full Service Hotel to be
Located at 714 Main Street,Accept Dedication of Property at 714 Main Street to the City,
and Authorize Execution of a Ground Lease of Property at 714 Main Street by the City to
Development Services Group, Inc.,or an Affiliate,and Authorize Execution of a Related
Room Block Agreement(COUNCIL DISTRICT 9)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to execute an Economic Development Program Agreement with
Development Services Group, Inc.,or an affiliate related to the development of a full service hotel to be
located at 714 Main Street;
2. Find that the terms and conditions of the Agreement,as outlined below,constitute a custom-designed
Economic Development Program,as recommended by the 2018 Comprehensive Plan and authorized by
Chapter 380 of the Texas Local Government Code,
3.Accept dedication of the property at 714 Main Street to the City and authorize execution of any
necessary related documents;
4.Authorize execution of a Ground Lease of the property at 714 Main Street by the City to Development
Services Group, Inc.,or an affiliate,with an option and put-option for the sale of the property after a period
of 10 years;and
5.Authorize execution of a Room Block Agreement with Development Services Group, Inc.,or an affiliate to
provide event room blocks in the hotel to potential Convention Center customers for a period of at least 10
years after the opening of the hotel.
DISCUSSION:
Development Services Group, Inc.,or an affiliate(Developer)intends to convert the existing 190,000
square foot office tower located at 714 Main St.into a 232 room four star hotel.The hotel will contain
approximately 10,000 square feet of meeting space,including a main ballroom,conference,boardroom
space.The hotel will also include an approximate 3,100 square foot full service restaurant and a 3,100
square foot penthouse bar that can also be available for private events. Total investment will be at least
$56 million,not including land acquisition,of which at least$36 million will be hard construction costs.
In order to facilitate this development,the City of Fort Worth(City)proposes to provide 10 annual Economic
Development Program grants to the Developer,as authorized by Chapter 380,Texas Local Government
Code. The grants will be tied to the amount of investment made by the Developer and satisfaction of other
project and spending requirements,as follows:
Investment:
Failure to meet the following criteria is an event of default,which subject to commercially reasonable notice
and cure rights,will result in immediate termination of the Agreement.
Minimum investment of$56 million in total development costs(exclusive of land acquisition costs).
Of this,a minimum$36 million shall be hard construction costs;
Minimum 220 key hotel;
Must contain 10,000 square feet of meeting space,including a main ballroom and conference rooms;
Must be completed by June 30,2021;
Must operate at Kimpton brand standards at all times or operate and be marketed in a manner that is
consistent with the standards for a Four Star Hotel as defined by Forbes Travel Guide;
Utilization of Fort Worth Companies and Fort Worth Certified M/WBE Companies(Real Property
Improvements);
The Developer will be required to spend 15 percent of hard construction costs with contractors that are Fort
Worth companies. The Developer will also be required to spend 15 percent of hard construction costs with
contractors that are Fort Worth certified Minority/Women-Owned Business Enterprise(M/WBE)companies
(with the understanding that dollars spent with Fort Worth certified MMIBE companies will also count as
dollars spent with Fort Worth companies).
Employment Commitments:
The Developer will employ a minimum of 30 full-time employees on the property by December 31,
2021. The Developer will fill the greater of 18 full time positions or 60 percent of all full time positions with
Fort Worth residents and will fill the greater of 8 full time positions or 25 percent of all full time positions with
Fort Worth Central City residents(with the understanding that employment of Fort Worth Central City
residents will also count as employment of Fort Worth residents).
Utilization of Fort Worth Companies and Fort Worth Certified M/WBE Companies(Supply&
Services):
The Developer will spend a minimum of$50,000.00 of annual discretionary service and supply
apps.cfwnet.org/council_packet/mc_review.asp?I D=26267&councildate=l 0/30/2018 1/3
6/10/2019 M&C Review
expenditures with Fort Worth companies. The Developer will spend a minimum of$50,000.00 of annual
discretionary service and supply expenditures with Fort Worth certified MMIBE companies(with the
understanding that dollars spent with Fort Worth certified MMIBE companies will also count as dollars spent
with Fort Worth companies).
Supply and Service Expenditures means all expenditures by the company expended directly for the
operation and maintenance of the development,excluding amounts paid for electric,gas,water and any
other utility services(but not excluding cable,internet or television services).
City Commitments:
The funding source for the grants will be revenues generated by the City's 7 percent hotel occupancy taxes
from the hotel. The City will make up to 10 annual Economic Development Program grants to the
Developer subject to the following conditions. The maximum annual program grant will equal 58 percent of
City's 7 percent hotel occupancy tax revenue received from the hotel in the previous year,with the overall
incentive capped at$6,000,000.00 gross. Except for cases of default,failure to meet a commitment will
result in a reduction of the corresponding component of the grant for that year proportional to the amount
the commitment was not met,or for the duration of the Agreement in the case of construction commitments.
TABLE IV-1 Maximum Potential Grant with Corresponding Components:
Property Owner or Company Commitment Potential
Grant
Real Property Investment(Base Commitment) 37 percent
Fort Worth Contractors 3 percent
Fort Worth M/WBE Contractors 3 percent
Overall Employment 3 percent
Employment of Fort Worth Residents 3 percent
Employment of Fort Worth Central City Residents 3 percent
Utilization of Fort Worth Companies for Services and 3 percent
Supplies
Utilization of Fort Worth M/WBE Companies for Services 3 percent
and Supplies
TOTAL(all components of maximum 58% HOT grant) 58 percent
Conveyance of Hotel Property to City and City Ground Lease to Developer:
Under the Texas Tax Code,the City is authorized to use local hotel occupancy tax revenue to,among other
things, pay for the construction, improvement,equipping,operation and maintenance of convention center
facilities. For cities the size of Fort Worth,a convention center facility includes a hotel that is located on
land owned by the City and that is located within 1,000 feet of a convention center facility or a convention
center complex. The hotel property is located within 1,000 feet of the Fort Worth Convention Center,which
qualifies as a convention center facility under the Tax Code. Therefore, in order for hotel occupancy tax
revenue from the hotel to serve as the funding source for the grants,the City must own the real property on
which the hotel is constructed. The Developer has agreed to deed the land to City at no cost to the
City. The City will then enter into a ground lease with the Developer for a term of 25 years. The Developer
must pay fair market annual rent to the City. However, in turn,the City will pay the Developer a second
Economic Development Program grant equal to the rent payment,less$100.00. The lease will give the
Developer an option to purchase the land at the end of the 10-year incentive program for the then fair-
market value of the land without consideration of the improvements,with the understanding that the City will
pay the Developer a final Economic Development Program grant equal to the purchase price,less
$10,000.00. The City will also have an option to obligate the Developer to purchase the land under those
terms. If neither exercises these options,annual rent will increase to the then-market rate for the remainder
of the 10-year term.
Room Block Agreement:
The Developer and the City will enter into a separate Room Block Agreement at market rate terms for a 10
year period,with provisions mutually agreed upon.
This project is located in COUNCIL DISTRICT 9.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that upon approval,the grants provided under this agreement will be built
into the City's long-term financial forecast for the Hotel Occupancy Tax Special Revenue Fund with a
maximum grant award of$6,000,000.00.
TO
Fund Department Account Project Program Activity Budget Reference# Amount
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FROM
Fund Department Account Project Program Activity Budget Reference# Amount
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Submitted for City Manager's Office by_ Robert Sturns(2663)
Originating Department Head: Robert Sturns(2663)
apps.cfwnet.org/council_packet/mc_review.asp?I D=26267&councildate=l 0/30/2018 2/3
6/10/2019 M&C Review
Additional Information Contact: Michael Hennig(6024)
ATTACHMENTS
180820 LocationMap.pdf
Form 1295 Certificate 100408695.pdf
apps.cfwnet.org/council_packet/mc_review.asp?I D=26267&councildate=10/30/2018 3/3