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HomeMy WebLinkAboutContract 53442 CITY SECRETARY CONTRACT NO. 53440 cG�s� GROUND LEASE BETWEEN CITY OF FORT WORTH AND AMERICAN QUARTER HORSE FOUNDATION This Ground Lease (the "Lease") is entered into between the City of Fort Worth, Texas, a home-rule municipal corporation ("Landlord") and the American Quarter Horse Foundation, a 50l(C)(3) corporation ("Tenant") which serves as the related charitable organization to the American Quarter Horse Association, a Texas non-profit corporation ("Association") as of the —r-� day of 2019 (.Effective Date"). WITNESSETH: WHEREAS, Landlord is the owner of unimproved real property located at 1400 Gendy Street, Fort Worth, Texas, as more particularly described in the attached Exhibit "A" (the "Premises"); WHEREAS, Landlord desires to lease the Premises to Tenant, and Tenant desires to lease the Premises from Landlord for the purposes of designing, constructing, maintaining and operating a new building (the "Building") for the American Quarter Horse Hall of Fame and Museum and the world headquarters of the Association; and WHEREAS, Fort Worth is known for celebrating its Western heritage, and Landlord has determined that the Building will enhance the Will Rogers Memorial Center's assemblage of equestrian facilities, museums, and event facilities by honoring the people and the horses who built the legacy of the American Quarter Horse and by promoting the American Quarter Horse industry; and WHEREAS, Tenant is raising funds from private donors to enable the design, construction, maintenance and operation of the Building, and upon completion of the fundraising efforts, Tenant anticipates breaking ground on the Building; and WHEREAS, Landlord and Tenant desire to set forth the terms and conditions of the ground lease of the Premises and the design, construction, maintenance and operation of the Building, all as set forth below NOW THEREFORE, in consideration of the terms and conditions set forth herein, and then good and valuable consideration, Landlord and Tenant covenant and agree as follows: VVI 00 OFFICIAL.RECORD a Lm,c-City to,aoj-m CITY SECRETARY e 1 of 22 FT. WORTH,TX ARTICLE 1. LEASE OF PREMISES 1.01. Leased Premises. Landlord demises and leases to Tenant, and Tenant leases from Landlord, the Premises, as the same may be hereafter supplemented and amended by a survey of the Premises obtained by Tenant. 1.02. Mineral Estate Reserved. Notwithstanding anything in this Lease to the contrary, Landlord reserves all oil, gas and other minerals in and under the Premises, as well as a right to grant leases and to conduct and undertake subsurface extraction of oil, gas and other minerals. Provided, however, Landlord waives all surface rights associated with the mineral estate in and under the Premises, and neither Landlord nor any lessee, successor or assignee of Landlord may enter on the surface of the Premises for exploration, extraction, or transportation of oil, gas or other minerals or take any action in exploring, extracting or transporting oil, gas or other minerals that adversely affects the surface of the Premises and the improvements thereon. 1.03. Parking. Tenant's employees shall be offered the uniform employee parking options provided to all museums and community entities located adjacent to the Will Rogers Memorial Center campus. ARTICLE 2. LEASE TERM 2.01. Tenn. The term of the Lease ("Tenn") shall commence on the date of Landlord's receipt of Tenant's written confirmation that Tenant's fund raising has been completed for commencement of the Building ("Commencement Date") and shall continue for a period of fifty (50) years from the Commencement Date, unless terminated sooner as provided in this Lease. Upon the establishment of the actual Commencement Date, Landlord and Tenant shall execute a Commencement Date Memorandum in the form set forth in the attached Exhibit "B". If Tenant has not provided Landlord with its written notice of completion of Tenant's fund raising for the Building by October 1, 2020, then Landlord may thereafter terminate this Lease by giving Tenant written notice of termination at any time until Landlord has received Tenant's written notice of completion of fund raising for the Building. The Lease will automatically renew for five ten-year terms provided that Tenant requests the renewal in writing to Landlord on or before sixty (60) days prior to the expiration of the Term or any extension. Tenant shall notify Landlord in writing at least thirty (30) days prior to Tenant's commencement of its initial on-site construction activities on the Premises. References in this Lease to the Tenn shall include any valid renewal term. 2.02. Tennination. This Lease will tenninate without further notice when the Tenn or any valid renewal term specified in Section 2.01 expires, and any holding over by Tenant after that Term expires will not constitute a renewal of this Lease or give Tenant any rights under the Lease in or to the Premises, except as a tenant at will. Ground Lease—City to AQHF Pale 2 of 22 2.03. Holdover Tenancy. If Tenant holds over and continues in possession of the Premises after the Term expires, Tenant will be considered to be occupying the Premises at will subject to all the terms of this Lease. ARTICLE 3. USE OF PREMISES 3.01. Permitted Use of Premises. Tenant may use the Premises only for the purpose of developing, constructing, and operating the Building to house a public museum known as the American Quarter Horse Hall of Fame and Museum, or similar name, and the world headquarters of the Association, and for purposes ancillary to the operation of the Building, and for no other purpose without the written consent of Landlord. Tenant anticipates subleasing a portion of the Building to the Association at a fair market value rental for the purposes of operating the Association's world headquarters. 3.02. Illegal Use Not Permitted. Tenant may not use all or any part of the Premises or the Building for any use or purpose that violates any valid and applicable law, regulation, or ordinance of the United States, the State of Texas, the County of Tarrant, or the City of Fort Worth, or other lawful authority with jurisdiction over the Premises. 3.03. Condition of Premises. Tenant accepts the Premises in their "as is" condition. Landlord has not made and does not make and specifically disclaims any representations, guarantees, promises, covenants, agreements or warranties of any kind or character whatsoever unless otherwise provided for herein, whether express or implied, oral or written, past, present or future of, as to, concerning or with respect to the nature, quality or condition of the Premises, the income to be derived, the suitability of the Premises for uses allowed under this Lease, or merchantability or fitness for a particular purpose. Landlord shall not be required to repair, maintain or restore the Building, nor to make any improvements, repairs or restorations upon or to any improvements located on the Premises during the Term of this Lease or any renewal terms. ARTICLE 4. CONSIDERATION 4.01. Rent. The fair market value rent for the Premises is deemed to be $90,953.28 per year ("Rent"). Rent, after the application of any waiver under Section 4.02 or Rent Credits under Section 4.03, shall be due and payable annually on each anniversary date of the Commencement Date; provided that payment of Rent shall not commence until the date the Premises or any portion thereof is available for occupancy, whether through a temporary certificate of occupancy or a permanent certificate of occupancy, and the first annual payment shall be prorated based on the number of days remaining until the next annual anniversary date of the Commencement Date. Payments shall be made to the City as directed in writing by the City from time to time. 4.02 Waiver of Rent for Museum Space. As the Premises will be occupied both by Tenant, a 501(c)(3) corporation, and by the Association, a 501(c)(5) corporation, Tenant shall seek an ad valorem property tax exemption for the portion of the Building to be used by Tenant ("Museum Space"). The remaining portion of the Building that will be leased to the Association Ground Lease—City to AOHF Page 3 of 22 ("Association Space") will not qualify for an ad valorem property tax exemption. Because the Museum Space will be used by Tenant for a public purpose, specifically a public museum and ancillary uses, Landlord waives the portion of the Rent allocable to the Museum Space for so long as the Museum Space is used as a public museum, in an amount based upon the percentage of the Museum Space square footage divided by the total square footage of the Building. If Tenant ceases to use all or a portion of the Museum Space as a public museum, Tenant shall give notice to Landlord in writing, and Tenant shall thereafter pay Rent in an amount that is prorated based on the square footage of the portion no longer used as a public museum, subject to any earned Rent Credits, as defined below. 4.03. Rent for Association Space; Rent Credits. For the portion of the Rent that is not waived under Section 4.02, provided that Tenant is not in default under this Lease, Tenant shall be entitled to receive a rent credit for the remaining Rent as follows: (a) Annual Events Credit. In addition to events that the Association holds in Fort Worth as of the Effective Date, Tenant shall be provided a rent credit of 25% of the remaining Rent for each year throughout the Tenn that the AQHA Youth World Championship Show and the AQHA World Championship Show are held in Fort Worth. Additionally, Tenant may request a rent credit of 25% of the remaining Rent for any additional event or show that Association holds in Fort Worth that has a demonstrable economic impact to the City of Fort Worth of a minimum of$25,000. Tenant must request the rent credit from a planned event or show by providing details of the event or show to Landlord in advance and subsequent to the event or show, providing to Landlord the following information in writing and in a form satisfactory to Landlord so that an economic impact projection can be calculated by the Public Events Department of Landlord: i. Number of attendees with break out of in state versus out of state, ii. Length of event, iii. Number of hotel rooms booked, and iv. Cost of facilities booked. Landlord shall respond to Tenant's request for a rent credit approving or denying the rent credit in writing within sixty (60) days of Tenant's provision of all necessary documents. Any rent credit provided under this Section 4.03(a) shall be referred to herein as the "Annual Events Credit". The Annual Events Credit may be earned for any applicable event that occurs up to twelve (12) months prior to the date that Rent is due. (b) Property Donation Credit. Tenant may request, in writing to Landlord, a rent credit in an amount of the fair market value of personal property donated by or on behalf of Tenant that may be utilized and accepted by the City on behalf of the Fort Worth Herd or the Fort Worth Police Mounted Patrol, including but not limited to horse trailers or horses. The Property to be donated must be accepted and approved by Ground Lease—City to AQHF Page 4 of 22 Landlord in writing, and the parties must agree in writing on the fair market value of the donation. Any rent credit granted to Tenant under this Section 4.03(b) shall be referred to herein as the "Property Donation Credit". Property Donation Credit may be earned for any applicable donation that occurs up to twelve (12) months prior to the date that Rent is due. In no event shall Landlord ever be required to pay Tenant for the Annual Events Credit or the Property Donation Credit, it being agreed by the parties that the Annual Events Credit and the Property Donation Credit shall only be used to reduce Tenant's payment of the remaining Rent. The Annual Events Credit and the Property Donation Credit are referred to herein collectively as the "Rent Credits". 4.04. Audits. Landlord will have the right throughout the Term to audit the financial and business records of Tenant that relate to the construction, maintenance and operation of the Building and the Premises as well as any other documents necessary to evaluate Tenant's compliance with this Lease or with the commitments set forth in this Lease (collectively "Records"). Tenant must make all Records available to Landlord on the Premises or at another location in the City of Fort Worth acceptable to both parties following reasonable advance notice by Landlord and will otherwise cooperate fully with Landlord during any audit. ARTICLE 5. CONSTRUCTION BY TENANT 5.01 Improvements. Tenant may, at its sole discretion and subject to the terms herein, erect, maintain, alter, remodel, reconstruct, rebuild, replace, and remove buildings and other improvements on the Premises. Any modifications, renovations, improvements or other construction work on the Premises shall be referred to hereafter as "Improvements", and shall be perfonned by an independent contractor engaged by and paid exclusively by Tenant ("Tenant's Contractor"). Tenant may not initiate any Improvements on or to the Premises unless it first submits all plans, specifications and estimates for the costs of the proposed work in writing and also requests and receives written approval from Landlord, or its designated representative("Landlord's Representative"), which Landlord herein designates as the Director of the Public Events Department or his/her designee. Upon start of construction of any Improvements on or to the Premises by Tenant pursuant to plans approved by Landlord pursuant to Section 5.02, Tenant shall achieve substantial completion of the Improvements in accordance with the plan specifications within thirty-six (36) months from start of construction. For the purposes of this Section, "start of construction" shall mean the date stated in a Notice to Proceed (or other similar document) issued by Tenant to its contractor, and "substantial completion"shall mean that point in time when the Improvements are completed to such extent that Landlord can issue a Certificate of Occupancy and a final punch-list is developed by Tenant and its contractor. Tenant covenants and agrees that it shall fully comply with all provisions of this Article 5 in the perfonnance of any such Improvements. Any of Landlord's property adjacent to the Premises that is damaged during the course of constructing the Improvements shall be repaired and returned to its previous condition or better, Ground Lease—City to AQ1-1 Page 5 of 22 at Tenant's sole cost and expense. Such repairs shall be performed prior to Tenant's Contractor demobilizing from the Premises. Tenant agrees that no Improvements will be designed or constructed in such a manner that it causes an adverse impact to the usability of Landlord's adjacent property. 5.02. Approval of Plans. (a) Process. Tenant's plans for the Improvements shall conform to the architectural standards established by Landlord's Representative and must also receive written approval from the Director of Property Management of the City of Fort Worth or his/her designee and any other City of Fort Worth departments as shall be required under ordinance or Landlord policy. All plans, specifications and work shall confon-n to all federal, state and local laws, ordinances, rules and regulations in force at the time that the plans are presented for review. Landlord shall inspect all work pursuant to its construction inspection procedures. (b) Exception to Landlord's Approval. The following items shall not be considered Improvements and do not require submission to, and approval by, Landlord: i. Minor repairs and alterations necessary to maintain existing structures and improvements in a useful state of repair and operation. ii. Changes and alterations required by an authorized public official with authority or jurisdiction over the buildings or improvements, to comply with legal requirements. (c) Effect of Approval. Landlord's approval does not constitute approval of the architectural or engineering design, and Landlord, by approving the plans and specifications, assumes no liability or responsibility for the architectural or engineering design or for any defect in the Building or any other or improvement constructed from the plans or specifications. (d) Compliance with ADA. Tenant agrees to submit the plans and specifications for the Improvements to the Texas Department of Licensing and Regulation for review and approval for compliance with applicable accessibility statutes and regulations prior to the commencement of construction of the Improvements 5.03. Documents. Tenant shall supply Landlord's Representative with comprehensive sets of documentation relative to any Improvements, including, at a minimum, as-built drawings of each project. As-built drawings shall be new drawings or redline changes to drawings previously provided to Landlord's Representative. Tenant shall supply the textual documentation in electronic format as requested by Landlord. Tenant shall also supply Landlord with an as-built survey as required in Section 15.01. Ground Lease—City to AOH F Page 6 of 22 5.04 Construction Requirements. (a) Tenant shall include in all Tenant construction contracts for Improvements the following provisions: "Contractor does hereby contract to waive all claims, release, indemnify, defend and hold harmless the American Quarter Horse Foundation, the American Quarter Horse Association, the City of Fort Worth and all of their respectives officials, officers, agents and employees ("Owner Indemnitees"), in both their public and private capacities, from and against any and all liability, claims, losses, damages, suits, demands or causes of action including all expenses of litigation and/or settlement, court costs and attorneys' fees which may arise by reason of injury to or death of any person or for loss of, damage to, or loss of use of any property, occasioned by error, omission or negligent act of Contractor, its officers, agents, employees, subcontractors, invitees or any other persons, arising out of or in connection with the performance of this contract, and Contractor will at its own cost and expense defend and protect the Owner Indemnitees from any and all such claims and demands. Provided, however, that in no event shall such indemnity apply to the extent the claims arise out of the negligence or willful misconduct of the Owner Indemnitees. In any and all claims against any Owner Indemnitee by any employee of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, the indemnification obligation herein provided shall not be limited in any way by any limitation on the amount payable under workers' compensation or other employee benefit acts." (b) Tenant agrees that all work to be performed by it or its contractor on the Premises, including all workmanship and materials, shall be of first-class quality and shall be performed in full compliance and in accordance with the approved schematic drawings, and such work shall be subject to inspection during the performance thereof and after it is completed. Tenant shall assume the risk of loss or damage to all such work prior to the completion thereof. Tenant shall repair or replace any such loss or damage without cost to Landlord. (c) Tenant shall deliver within seven (7) business days of a request from Landlord, written progress reports of the work performed and shall at all times during the Term of this Lease and any extension thereof keep construction reports and drawings current showing any changes or modifications made in or to the Improvements constructed on the Premises. (d) Nothing in this Lease shall be construed as an agreement by Landlord to waive any lien Landlord may have, constitutional, statutory or contractual, upon any leasehold improvements on the Premises. 5.05. Easements, Dedications, Zoning, and Restrictions. Landlord will cooperate with Tenant Ground Lease—City to AQHF Page 7 of 22 concerning easements, dedications, zoning, and restrictions of the Premises as follows: (a) Easements and Dedications. To provide for the more orderly development of the Premises, it may be necessary, desirable, or required that street, water, sewer, drainage, gas, power lines, and other easements and dedications and similar rights be granted or dedicated over or within portions of the Premises. Landlord will, on Tenant's request, join with Tenant in executing and delivering the documents, from time to time, and throughout the Term, as may be appropriate, necessary, or required by any governmental agency, public utilities, and companies for the purpose of granting the easements and dedications. Provided, however, any such dedication shall be subject to City Council approval. (b) Zotiin . If Tenant considers it necessary or appropriate to obtain use, zoning, or subdivision and plan approval and permits for the Premises or any part of them, Landlord, subject to any required approval by the City Council or other appropriate City of Fort Worth board or commission, will execute the documents, petitions, applications, and authorizations as are appropriate or required to submit the Premises, or any part of them, for the purposes of obtaining conditional use pen-nits, zoning and rezoning, tentative and final tract approval, and plan approval. Landlord will execute these documents from time to time as requested by Tenant, and shall do so in its capacity as Landlord, and cannot guarantee any particular outcome for any application requiring approval by City Council or City of Fort Worth boards or commissions. (c) Expenses. Tenant exclusively bears the cost and expense of any action required of Landlord under subparagraphs (a) and (b), above. 5.06. Ownership of Improvements. Any buildings, improvements, additions, alterations, and fixtures constructed, placed, or maintained on the Premises during the Term of this Lease will be the property of Tenant throughout the Term and any extensions thereof. Upon the expiration or tennination of this Lease, all buildings, improvements additions, alterations and fixtures (except the Removables [defined below]) must remain on the Premises and shall become the property of Landlord, subject to any rights of any Leasehold Mortgagee. 5.07. Right to Remove Personal Property; Fixtures. Tenant may, at any time while it occupies the Premises, or within a reasonable time thereafter, not to exceed ninety (90) days, remove personal property, furniture, machinery, equipment, or other trade fixtures owned or placed by Tenant, its subtenants or Tenants, in, under, or on the Premises, or acquired by Tenant, whether before or during the Tenn and any extension ("Removables"). Before the Lease terminates, Tenant must repair any damage to any buildings or improvements on the Premises resulting from the removal. Any Removables not removed within a reasonable time after the Lease termination date, not to exceed ninety (90) days, will become Landlord's property. 5.08 Bike Rack. The parties agree that the Fort Worth Bike Share bike rack that is currently sited on the Premises must be removed and relocated, at Tenant's sole cost and expense, to a Ground Lease—City to AOHF Page 8 of 22 location to be detennined by the City in its sole discretion, prior to the construction of the Improvements. ARTICLE 6. TAXES AND OTHER CHARGES 6.01. Payment by Tenant. Tenant shall be responsible for the payment of all insurance and other operating and capital expenses associated with the possession, maintenance, use, alteration, repair, rebuilding, ownership and operation of the Building, other Improvements, and the Premises. Without limiting the generality of the foregoing, Tenant shall pay and discharge, prior to the delinquency thereof, all lawful assessments, ad valorem taxes, sales taxes, business and occupation taxes, occupation license taxes, water charges, or sewage disposal charges, and all other governmental taxes, impositions, and charges of every kind and nature, and all applicable interest and penalties, if any, which at any time during the Term become due and payable by Tenant because of its rights or obligations under this Lease and which are lawfully levied, assessed or imposed by virtue of any present or future law, statute, ordinance, regulation or other requirement of any governmental authority, whether federal, state, county, city, municipal, school or otherwise (collectively, "Taxes") imposed on the Building, other Improvements, the Premises and Tenant's use and occupancy thereof or against personal property, furniture or fixtures placed or situated in or on the Premises during the Term. Tenant, upon written notice to Landlord, may contest in good faith any Taxes (other than water charges or sewage disposal charges), and in such event may pen-nit such Taxes (other than water charges or sewage disposal charges) to remain unsatisfied during the period of such contest and any appeal. ARTICLE 7. UTILITIES 7.01. Payment by Tenant. Tenant, at Tenant's sole cost and expense, shall be responsible for the installation and use of all utilities services to all portions of the Premises and for all other related utilities expenses, including, but not limited to, deposits and expenses required for the installation of meters. Tenant further covenants and agrees to pay all costs and expenses for any extension, maintenance or repair of any and all utilities serving the Premises during the Term. In addition, Tenant agrees that all utilities, air conditioning and heating equipment and other electrically-operated equipment which may be used on the Premises shall fully comply with City of the City of Fort Worth's Mechanical, Electrical, Plumbing, Building and Fire Codes ("Codes"), as they exist or may hereafter be amended. ARTICLE 8. REPAIRS, MAINTENANCE, AND RESTORATION 8.01. Tenant's Duty to Maintain and Repair. At all times during the Tenn, Tenant will keep and maintain, or cause to be kept and maintained, the Building and any other Improvements erected on the Premises in a good state of appearance and repair (except for reasonable wear and tear) at Tenant's own expense. Tenant agrees that all Improvements, trade fixtures, furnishings, equipment and other personal property of every kind or description which may at any time be on the Premises shall be at Tenant's sole risk or at the sole risk of those claiming under Tenant. Landlord shall not be liable for any damage to such property or loss suffered by Tenant's business or business operations from any causes whatsoever. Ground Lease--City to AOHF Page 9 of 22 8.02. Damage or Destruction. if the Building is substantially damaged or destroyed by fire or any other casualty, Tenant must, within ninety (90) days from the date of the damage or destruction, begin to repair, reconstruct, or replace the damaged or destroyed Building and pursue the repair, reconstruction, or replacement with reasonable diligence so as to restore the Building to substantially the condition it was in before the casualty. However, if beginning or completing this restoration is prevented or delayed by war, civil commotion, acts of God, strikes, governmental restrictions or regulations, or interferences, fire or other casualty, or any other reason beyond Tenant's control, whether similar to any of those enumerated or not, the time for beginning or completing the restoration (or both) will automatically be extended for the period of each such delay. ARTICLE 9. MECHANICS' LIENS 9.01. Mechanics' Liens. Tenant will not cause or permit any mechanics' liens or other liens to be filed against the fee of the Premises or against Tenant's leasehold interest (excluding any Leasehold Mortgage) in the land or the Building or other Improvements by reason of any work, labor, services, or materials supplied or claimed to have been supplied to Tenant or anyone holding the Premises or any part of them through or under Tenant. If such a mechanic's lien or materialman's lien is recorded against the Premises or the Building or other Improvements, Tenant must either cause it to be removed or, if Tenant in good faith wishes to contest the lien, take timely action to do so, at Tenant's sole expense. if Tenant contests the lien, Tenant will indemnify Landlord and hold it harmless from all liability for damages occasioned by the lien or the lien contest and will, in the event of a judgment of foreclosure on the lien, cause the lien to be discharged and removed before the judgment is executed. TENANT AGREES TO DEFEND AND INDEMNIFY LANDLORD FROM ANY CLAIM ASSERTED BY LIEN CLAIMANTS ON THE PREMISES ARISING OUT OF THE PERFORMANCE OF CONSTRUCTION OF IMPROVEMENTS BY TENANT'S CONTRACTOR ON THE PREMISES. ARTICLE 10. LEASEHOLD MORTGAGE 10.01 Leasehold Mortg-age. Tenant will be entitled, at any time and from time to time, without Landlord's consent, and on terns and conditions determined by Tenant to be appropriate, to mortgage, pledge, grant deed(s) of trust, or otherwise encumber all or any portion of the leasehold estate created hereby and all or any portion of the right, title, and interest of Tenant under this Lease (including Tenant's interest in the Improvements), and to assign, hypothecate, or pledge it as security for the payment of any debt to any holder of a promissory note or other evidence of indebtedness (such notes, mortgages, deeds of trust, and other documents evidencing and securing such loans hereinafter referred to as a "Leasehold Mortgage" and a holder of a Lcasehold Mortgage as a "Leasehold Mortgagee"), all of which shall be subordinate to Landlord's interest under this Lease. After the execution and recordation of any Leasehold Mortgage, Tenant or the Leasehold Mortgagee must notify Landlord in writing that a Leasehold Mortgage has been given and executed by Tenant and must furnish Landlord with the address to which copies of notices Ground Lease—City to AOFiF Page 10 of 22 should be mailed. Landlord agrees that it will thereafter give to the Leasehold Mortgagee, at the address so given, duplicate copies of any and all notices in writing that Landlord may from time to time give or serve upon Tenant under and pursuant to the teens and provisions of this Lease. No Leasehold Mortgagee will be or become liable to Landlord as an assignee of this Lease or otherwise until it expressly assumes such liability in writing, and no assumption may be inferred or result from foreclosure or other appropriate proceedings in the nature thereof, or, as the result of any other action or remedy provided for by any Leasehold Mortgage or other instrument executed in connection with the Leasehold Mortgage or from a conveyance from Tenant pursuant to which the purchaser at foreclosure (or grantee or transferee in lieu thereof) acquires the rights and interests of Tenant under the terms of this Lease, provided the obligations of Tenant are fulfilled. Landlord agrees that upon the occurrence of any event of default under the Leasehold Mortgage, Leasehold Mortgagee may (but shall not be obligated) to assume, or cause a new lessee or purchaser of the leasehold estate created hereby to assume, all the interests, rights and obligations of Tenant thereafter arising under this Lease; provided, however, that any new lessee or purchaser of the leasehold estate is approved by Landlord's City Council, and that any defaults by Tenant must be cured pursuant to this Lease as herein provided (other than any such default related to [i] the institution of bankruptcy or insolvency proceedings with respect to Tenant, [ii] the appointment of a receiver or trustee for the whole or any part of Tenant's property, or [iii] the dissolution or winding up, in whole or in part, of Tenant). Landlord hereby agrees to provide notice of any default by Tenant under this Lease to each Leasehold Mortgagee whose name and address has been provided to it and is designated as Leasehold Mortgagee pursuant to this Article 10. In the event of any default by Tenant (after exhaustion of the cure periods provided in Article 13 below), Landlord shall refrain from exercising any remedy with respect to such default unless and until (1) with respect to any default concerning the obligation to pay any amounts due under this Lease, Landlord shall give a further written notice thereof to Leasehold Mortgagee and such default remains uncured at the expiration of ten (10) days after Leasehold Mortgagee's receipt of Landlord's written notice of such default; and (ii) with respect to any other default, Landlord shall give a further written notice thereof to Leasehold Mortgagee and such default remains uncured at the expiration of thirty (30) days after Leasehold Mortgagee's receipt of Landlord's written notice of such default;provided, hoivever, that if such non-monetary default cannot with diligent efforts be cured within thirty (30) days, Leasehold Mortgagee shall have additional time to cure so long as Leasehold Mortgagee commences action to remedy such failure promptly following such notice and diligently prosecutes such action in good faith. Landlord agrees to accept performance by Leasehold Mortgagee of any covenant, condition or agreement on Tenant's part to be performed under this Lease (whether prior to or after any default by Tenant) with the same force and effect as though performed by Tenant. 10.02 New Ground Lease. Notwithstanding any contrary provision hereof, upon termination of this Lease for any reason (including, without limitation, bankruptcy of Tenant) other than by expiration of the Term, Leasehold Mortgagee shall have the exclusive right and option, exercisable by delivery of notice to Landlord within fifteen (15) days following receipt by Leasehold Mortgagee of notice from Landlord of the tennination hereof, to elect to receive, in its Ground Leasc—City to AQHF Page I I of 22 own name or an affiliate, from Landlord a new lease(the "New Ground Lease") for the Premises for the unexpired balance of the term. The New Ground Lease will be on the same terms and conditions as herein provided and executed to be effective as of the date of termination of this Lease by Leasehold Mortgagee and Landlord within thirty (30) days of receipt by Leasehold Mortgagee of such notice from Landlord of the termination hereof; provided, however, that in such event, Leasehold Mortgagee shall be entitled to receive such a New Ground Lease only if Leasehold Mortgagee shall cure any defaults by Tenant hereunder prior to execution of such New Ground Lease (other than any such default related to [i] the institution of bankruptcy or insolvency proceedings with respect to Tenant, [ii] the appointment of a receiver or trustee for the whole or any part of Tenant's property, or [iii] the dissolution or winding up, in whole or in part, of Tenant). After any termination of this Lease after which Leasehold Mortgagee has the right to obtain a New Ground Lease as provided in this Section 10.02, for so long as Leasehold Mortgagee has such right, Landlord shall not tenninate any subleases or the rights of any sublessee except in the case of a default under any such sublease. During said time period Landlord will not collect or receive rents from any subtenant. 10.03 Automatic Stay. If, during the period described in Section 10.01 and 10.02 above, Leasehold Mortgagee shall be precluded by the bankruptcy laws of the United States or by process or issue of any court having jurisdiction in connection with any bankruptcy, insolvency or other similar proceeding, from commencing and pursuing to completion all necessary steps and proceedings required for the foreclosure or transfer in lieu of foreclosure of the Leasehold Mortgage, then Landlord shall extend said period so long as may reasonably be required, provided that Leasehold Mortgagee is diligently and in good faith exerting all reasonable efforts to obtain an appropriate release from any applicable court order or restraint, and.fiu•ther p►•o►ided that upon such release, Leasehold Mortgagee shall in good faith immediately commence and diligently pursue to completion all steps and proceedings for consummation of such foreclosure. 10.04 Limit on Leasehold Mortgagee's Liability. Except as provided below, Leasehold Mortgagee shall not be liable to perform Tenant's obligations under this Lease until Leasehold Mortgagee acquires Tenant's rights by foreclosure or by transfer in lieu of foreclosure, provided. however, Leasehold Mortgagee shall be required to cure Tenant's defaults under this Lease (other than any such default related to [1] the institution of bankruptcy or insolvency proceedings with respect to Tenant, [ii] the appointment of a receiver or trustee for the whole or any part of Tenant's property, or [iii] the dissolution or winding up, in whole or in part, of Tenant) occurring before its acquisition of the Premises by foreclosure or transfer in lieu of foreclosure after it acquires the Premises pursuant to such foreclosure or transfer in lieu of foreclosure as contemplated by Sections 10.01 and 10.02. After acquiring Tenant's rights by foreclosure or transfer in lieu of foreclosure, Leasehold Mortgagee shall, subject to the provisions of this Article 10, be liable to perform Tenant's obligations under this Lease only until Leasehold Mortgagee transfers or assigns the leasehold estate to a person which expressly assumes the obligations of Tenant under this Lease, and such liability of Leasehold Mortgagee shall terminate upon such transfer or assignment for obligations first accruing from and after the date of such Ground Lease—City to AUHF Page 12 of 22 transfer or assignment. No holder of a Leasehold Mortgage shall acquire greater rights or interest than Tenant has under this Lease. 10.05 No Voluntary Cancellation. No voluntary cancellation, tennination, surrender, amendment or modification of this Lease by Tenant shall bind any Leasehold Mortgagee if done Without the prior written consent of such Leasehold Mortgagee, which consent shall not be unreasonably withheld with respect to an amendment or modification of this Lease. 10.06 Requirements for Transferee. Notwithstanding anything contained in this Lease to the contrary, no purchaser or transferee at any foreclosure sale, transfer in lieu thereof or other transfer authorized by law or this Lease of Tenant's interest shall acquire any right, title or interest in or to Tenant's interest in the Premises unless (i) said purchaser or transferee shall, in the instrument transferring the same or immediately aver acquiring the same, assume and agree to keep, observe and perform all of the terms, covenants and provisions of this Lease on the part of Tenant to be kept, observed and performed (including the obligation to cure defaults arising prior to such assumption); provided, however, Leasehold Mortgagee's obligations upon its acquisition of Tenant's rights shall be subject to the tenns of Section 10.04 above, (ii) said purchaser or transferee is approved by Landlord's City Council, and (iii) a duplicate original of said assumption agreement, duly executed and acknowledged by said purchaser or transferee, shall be delivered to Landlord promptly following the consummation of such sale or transfer. 10.07 Fee Mortgage. This Lease shall be superior to any deed of trust or other security instrument now or hereafter placed on Landlord's fee interest in the Premises by Landlord and to all advances made thereunder and to all renewals, modifications, consolidations, replacements and extensions thereof. If any holder of any mortgage, indenture, deed of trust or other similar instrument succeeds to Landlord's interest in the Property, Tenant will pay to such holder any sums payable to Landlord which are subsequently payable under this Lease. Tenant shall, upon request of such person succeeding to the interest of Landlord, automatically become the tenant of, and attorn to, such successor-in-interest without changing this Lease. Upon request by Landlord or such successor-in-interest, Tenant will execute, acknowledge and deliver an instrument or instruments confirming the attornment. 10.08 No Merger. There shall be no merger of this Lease or the leasehold estate hereunder with the fee estate in the Premises by reason of the fact that this Lease or the leasehold estate hereunder may be held, directly or indirectly, by or for the account of any entities who hold the fee estate. No such merger shall occur unless all entities having an interest in the fee estate and all entities (including Leasehold Mortgagee) having an interest in the Lease or the leasehold estate hereunder join in a written statement effecting such merger and duly record the same. 10.09 Damage or Destruction. If the cost to restore Improvements exceeds the available insurance proceeds, Tenant, Lcasehold Mortgagee and Landlord agree to use good faith efforts to arrive at a mutually agreeable solution to addressing this additional cost; provided, however, no such good faith efforts shall negate or diminish Tenant's obligations and liability to Landlord and Leasehold Mortgagee. Ground Lease—City to AQHF Page 13 of 22 10.10 Amendment or Modification. This Lease may not be modified or amended without the prior written consent of the Leasehold Mortgagee. 10.1 1 Additional Provisions. To the extent the Leasehold Mortgagee requests revisions to this Article, Landlord and Tenant will agree to reasonably accommodate such revisions to the extent they are consistent with commercially reasonable lending standards, subject to any required City Council approval of the amendment. ARTICLE 11. INDEMNIFICATION AND INSURANCE 11.01. INDEMNIFICATION OF LANDLORD. TENANT SHALL INDEMNIFY LANDLORD AND LANDLORD'S OFFICERS, AGENTS AND EMPLOYEES ("INDEMNITEES") FROM AND AGAINST ANY LOSS, DAMAGE, OR INJURY OF ANY KIND TO ANY PERSON OR PROPERTY ARISING FROM ANY USE OR OCCUPANCY OF THE PREMISES (OR ANY PART OF THEM), OR CAUSED BY ANY DEFECT IN ANY BUILDING, STRUCTURE, IMPROVEMENT, EQUIPMENT, OR FACILITY ON THE PREMISES OR CAUSED BY OR ARISING FROM ANY ACT OR OMISSION OF TENANT, OR ANY OF ITS AGENTS, EMPLOYEES, TENANTS, OR INVITEES, OR BY OR FROM ANY ACCIDENT, FIRE, OR OTHER CASUALTY ON THE PREMISES, OR BROUGHT ABOUT BY TENANT'S FAILURE TO MAINTAIN THE PREMISES IN SAFE CONDITION, OR ARISING FROM CLAIMS REGARDING THE LEGALITY OF TENANT'S OCCUPANY OF THE PREMISES, EVEN IN THE EVENT SUCH LOSS, DAMAGE, INJURY OR CLAIM RESULTS FROM THE ALLEGED NEGLIGENCE OF INDEMNITEES. 11.02. Insurance Required Related to Construction Tenant shall require Tenant's Contractor to procure, and maintain at all times during the construction of Improvements, in full force and effect, the following policies of insurance: (1) statutory worker's compensation insurance for all of Tenant's Contractor's employees and all workmen on the Premises performing construction of Improvements, (ii) commercial general liability insurance, (Ili) business automobile insurance, and (iv) builder's risk insurance. The commercial general liability insurance policy and the automobile liability insurance policy shall be primary to all other insurance maintained by Tenant or Landlord and shall be non- contributory; shall contain an endorsement listing the Landlord and Tenant as additional insured (endorsement CG 20 10 10 01 and CG 20 37 10 01) such that coverage is provided to the additional insured parties for completed operations; and shall be written for not less than the limits of liability as follows: (i) Commercial General Liability: $2,000,000 each occurrence; $3,000,000 general aggregate per project; $3,000,000 product/completed operations aggregate; and $2,000,000 personal and advertising injury. Ground Lease—City to A014F Page 14 of 22 (ii) Business Automobile Liability: $1,000,000 combined single limit. The commercial general liability policy shall contain a contractual liability endorsement and a products completed operations endorsement. The insurance policies shall not include any of the following endorsements excluding or limiting coverage: (1) contractual liability limitation, CG 21 39; (ii) amendment of insured contract definition, CG 24 26; (iii) exclusion — explosion, collapse and underground property damage hazard, CG 21 42 or CG 21 43; (iv) limitation of coverage to designated premises or project, CG 21 44 07 98; (v) exclusion — damage to work perfonned by subcontractors on your behalf, CG 22 94 or CG 22 95; (vi) any type of construction defect completed operations exclusion; and/or(vii) any type of punitive, exemplary, or multiplied damages exclusion. The worker's compensation policy shall contain a waiver of subrogation endorsement in favor of Landlord and Tenant. All insurance companies providing coverage pursuant to the requirements of this Lease shall have a minimum Best's Rating of A- and a Financial Size Category listing of no lower than VII, both as provided by A.M. Best Company, Inc. Upon request by Landlord, Tenant shall deliver a copy of all such policies of insurance required in this Lease. 11.03. Insurance Required Related to On-Going Occupancy and Use of the Premises. Tenant is required to obtain and maintain the following lines of insurance and limits of coverage during the entire Term and any extension. Tenant will name Landlord, its officers, agents, and employees as additional insured on relevant policies and obtain such coverage through insurance companies admitted or approved to issue the coverage in the State of Texas and have an AM Best rating of ANII. Landlord shall have no responsibility for any costs associated with the required insurance. (a) Building and Improvements. At all times during the Tenn and any extension, Tenant shall maintain commercial all-risk property insurance on all buildings and other Improvements located or being constructed on the Premises at not less than eighty percent (80%) of the replacement cost of such Improvements. Tenant shall pay all costs for such insurance and shall be responsible for any deductible required. The insurance policy or policies must name both the Landlord and Tenant as named insured and may provide that any loss of$100,000 or less will be payable solely to Tenant for restoration of the Improvement. Any loss over $100,000 will be made payable jointly to Landlord and Tenant, but Landlord shall promptly allow the release of insurance proceeds to enable Tenant to meet its repair obligations in Section 8.02 above. (b) Commercial General Liability Insurance. At all times during the Term and any extension, Tenant shall maintain commercial general liability insurance covering Ground Luse—City to AQHf• Page 15 of 22 Landlord and Tenant for liability for property damage and personal injury at a limit of not less than S 1,000,000 per occurrence. 11.04. Certificates of Insurance. Tenant must furnish Landlord with certificates of all insurance required by this Section. if requested by Landlord, Tenant must also supply copies of the individual policies of insurance. If Tenant does not keep required insurance in full force and effect, Landlord may notify Tenant of this failure, and if Tenant does not deliver certificates showing all such insurance to be in full force within ten (10) days after this notice, Landlord may, at its option, acquire or pay premiums on the insurance needed to fulfill Tenant's obligations under this section. On Landlord's demand, Tenant must reimburse Landlord the full amount of any insurance premiums paid by Landlord under this section, with interest at the rate of ten percent (10%) annually from the date of Landlord's demand until reimbursement by Tenant. ARTICLE 12. ENVIRONMENTAL AND HAZARDOUS MATERIALS 12.01 For purposes of this Lease, the following terms shall have the following meanings: (1) "Hazardous Materials" shall mean (i) any petroleum or petroleum products, radioactive materials, asbestos in any form that is or could become friable, urea fonnaldehyde foam insulation, transformers, or other equipment that contains dielectric fluid containing polychlorinated biphenyls in violation of Environmental Law, and radon gas in indoor air at concentrations above US Environmental Protection Agency action levels; (ii) any chemicals or substances now or hereafter defined as or included in the definition of"hazardous materials", hazardous wastes", "extremely hazardous wastes", "restricted hazardous wastes", "toxic substances", "toxic pollutants", "contaminants" or "pollutants", or words of similar import, under any applicable Environmental Law; and (iii) any other chemical, material, or substance, exposure to which is now or hereafter prohibited, limited, or regulated, by any applicable Environmental Law or governmental authority; (2) "Release" or "Released" means disposed, discharged, injected, spilled, leaked, leached, dumped, emitted, escaped or emptied in, on, or under any land, water, or air, or otherwise entered into the environment, and as otherwise more broadly defined in applicable Environmental Law; (3) "Environmental Law" means all applicable Governmental Rules (whether now or hereafter in effect), relating to the regulation of, imposing standards of conduct or liability regarding, or protection of, human health, natural resources, conservation, the environment, or the storage, treatment, disposal, transportation, handling or other management of Hazardous Materials; and (4) "Governmental Rules" means all statutes, laws, treaties, rules, codes, ordinances, regulations, pen-nits, interpretations, certificates or orders of any governmental entity, or any judgments, decisions, decrees, injunctions, writs, orders or like actions of any court, arbitrator, or other Federal, State or local governmental entity. Tenant hereby acknowledges and agrees that Landlord is not the Generator as defined by Environmental Law of any Hazardous Materials which Tenant has allowed on the Premises. 12.02 Tenant covenants and agrees with Landlord as follows: (1) the construction and installation of all Improvements and the use and operation of the Premises shall at all times be in material compliance with applicable Environmental Law; (2) Tenant will obtain all environmental permits, licenses. and approvals that are necessary or required by applicable Ground Lease—City to AQHF Page 16 of 22 Environmental Law to conduct its business and operations on the Premises prior to conducting such business or operations, and Tenant shall at all times materially comply with such environmental pennits, licenses, and approvals; (3) neither Tenant nor any person acting on behalf of or at the direction of Tenant shall bring onto, use, store, generate, treat, process, dispose of, recycle, incinerate or transport any Hazardous Materials in, on, or under the Premises except in compliance with applicable Environmental Law and in a reasonable and prudent manner so as to prevent the Release or threat of Release of any Hazardous Material on, onto or from the Premises; (4)Tenant shall regularly inspect the Premises to monitor and ensure that the Premises are at all times in material compliance with applicable Environmental Law; (5) Tenant shall use commercially reasonable efforts to protect the Premises against intentional or negligent acts or omissions of third parties which might result in the Release of Hazardous Materials on the Premises in violation of applicable Environmental Law; and (6) if Tenant has actual knowledge that any Hazardous Materials are Released by Tenant or any person other than bandlord or Landlord's agents in, on, or under the Premises in violation of Environmental Law during the Tenn of this Lease: a. Tenant shall promptly notify Landlord of the occurrence of the Release of the Hazardous Materials and shall promptly provide Landlord with Tenant's response action and/or communication with any governmental agency to which Tenant is required by applicable laws to report such Release. Tenant shall furnish or make available to the Landlord such information, documents, and other communications as Landlord shall reasonably request; b. Tenant shall promptly and timely commence or cause to be commenced appropriate actions required by applicable Environmental Law to clean up the Hazardous Materials that have been Released on the Premises (collectively referred to as "Response Action") and shall conduct and perform or cause to be conducted or performed all appropriate Response Action in accordance with applicable Environmental Law; and C. Tenant, at its sole cost, shall contract for or perform all Response Action in the Tenant's own name or cause the violator to do so in the violator's name. 12.03 TENANT HEREBY COVENANTS AND AGREES THAT IT SHALL BE RESPONSIBLE FOR, AND WAIVES, RELEASES, AND FOREVER DISCHARGES THE INDEMNITEES FROM, AND AGREES TO INDEMNIFY, DEFEND, AND HOLD THE INDEMNITEES HARMLESS FROM AND AGAINST, ALL EXPENSES, COSTS (INCLUDING REASONABLE ATTORNEYS' FEES AND COURT COSTS), LOSSES, DAMAGES, PENALTIES, FINES, AND OTHER EXPENDITURES OF ANY NATURE ARISING FROM OR IN CONNECTION WITH ANY CLAIMS, DEMANDS, LIENS, INVESTIGATIONS, NOTICES OF VIOLATION, GOVERNMENTAL DIRECTIVES, CAUSES OF ACTION OR ANY OTHER ADMINISTRATIVE OR LEGAL PROCEEDINGS OF ANY NATURE WHICH RESULT FROM, RELATE TO, OR ARISE OUT OF (1) THE BREACH OF ANY COVENANT OR AGREEMENT OF TENANT IN THIS SECTION 12.031 (2) THE PRESENCE OR ALLEGED PRESENCE OF Ground Lease—City to AOHF Page 17 of 22 HAZARDOUS MATERIALS IN, ON, OR UNDER THE PREMISES IN VIOLATION OF ANY ENVIRONMENTAL LAW, OR (3) THE VIOLATION OF ANY APPLICABLE ENVIRONMENTAL LAW WITH RESPECT TO THE PREMISES DURING THE TERM OF THIS LEASE; SO LONG AS, IN EACH INSTANCE, THE PRESENCE OR RELEASE OF THE HAZARDOUS MATERIAL OR THE VIOLATION OF ENVIRONMENTAL LAW WAS NOT CAUSED DIRECTLY OR INDIRECTLY BY LANDLORD OR AN INDEMNITEE. THIS RELEASE AND INDEMNITY SPECIFICALLY INCLUDES (A) ALL COSTS OF "REMOVAL" AND/OR "REMEDIAL ACTION" AND ALL OTHER COSTS OF "RESPONSE", AS THOSE TERMS ARE DEFINED AND USED IN APPLICABLE ENVIRONMENTAL LAW, AND (B) ALL OTHER COSTS AND EXPENSES OF ANY NATURE INCURRED BY, ASSESSED AGAINST, IMPOSED UPON, OR CHARGED TO THE INDEMNITEES RELATING TO COMPLIANCE WITH OR ENFORCEMENT OF APPLICABLE ENVIRONMENTAL LAW. IF ANY INDEMNITEE INCURS COSTS OR EXPENSES DESCRIBED IN THIS INDEMNITY, TENANT SHALL REIMBURSE THE INDEMNITEE FOR THOSE REASONABLE COSTS OR EXPENSES WITHIN THIRTY (30) DAYS OF THE DATE OF RECEIPT BY TENANT OF NOTICE FROM THE INDEMNITEE, INCLUDING COPIES OF INVOICES OR OTHER VERIFICATION, THAT THE COSTS OR EXPENSES HAVE BEEN INCURRED. THE FOREGOING RELEASE AND INDEMNITY SHALL SURVIVE THE EXPIRATION OR TERMINATION OF THIS LEASE. 12.04 if(i) there exists any uncorrected violation by Tenant of an Environmental Law or any condition, caused directly or indirectly by Tenant, which requires a cleanup, removal or other remedial action by Tenant under any Environmental Law, and such cleanup, removal or other remedial action is not initiated within the time period required by Environmental Law or (ii) Landlord reasonably detennines that (A) such uncorrected violation or condition poses an imminent threat to the safety or wellbeing of any other users of the Premises, the citizens of the City of Fort Worth, or other persons, or (B) the Premises is likely to be further damaged or contaminated or other land on or in the vicinity of the Premises is likely to be damaged or contaminated by virtue of the continued failure to correct such violation or condition; and such cleanup, removal or other remedial action is not initiated within ninety (90)days from the date of written notice from Landlord to Tenant, and diligently pursued to completion, the same shall, at the election of Landlord, constitute a default hereunder; and provided, further, that Landlord will not consider any failure to initiate such cleanup, removal or other remedial action within the aforesaid ninety (90) day period a default if such cleanup, removal or other remedial action is of such a nature that it cannot readily be initiated within the ninety (90) days and so long as Tenant commences in good faith to cure such uncorrected violation or condition and diligently pursues the cure continuously thereafter. 12.05 Tenant hereby grants to Landlord, its agents, employees, consultants, contractors, successors, and assigns, an irrevocable license and authorization, upon reasonable notice, to enter upon and inspect the Premises (but not any facilities or improvements thereon), and perform such tests, including without limitation, subsurface testing, soils and groundwater testing, and any other tests thereon, as Landlord, in its sole discretion, detennines is necessary to protect its Ground Lease—City to A HF Pagc 18 of 22 interest in the Premises, provided, however, that such access to the Premises shall not unreasonably interfere with Tenant's use of the Premises. 12.06 During the Tenn, Tenant agrees to provide Landlord with copies of any environmental reports Tenant obtains (without Tenant being obligated to obtain any such reports) relating to the Premises. ARTICLE 13. DEFAULT AND REMEDIES 13.01. Tennination on Default. If Tenant defaults in perfonning any covenant or teen of this Lease and does not correct the default within thirty (30) days after receipt of written notice from Landlord to Tenant specifying the default, plus an additional reasonable period of time if Tenant is proceeding with diligence to cure the default, then Landlord may declare this Lease, and all rights and interest created by it, tenninated. if Landlord elects to terminate, this Lease will cease as if the day of Landlord's election were the day originally fixed in the Lease for its expiration. I3.02. Other Remedies. Any tennination of this Lease as provided in this Article will not relieve Tenant from paying any sum or sums due and payable to Landlord under the Lease at the time of tennination, or any claim for damages then or previously accruing against Tenant under this Lease. Any such termination will not prevent Landlord from enforcing the payment of any such sum or sums or claim for damages by any remedy provided for by law, or from recovering damages from Tenant for any default under the Lease. All Landlord's rights, options, and remedies under this Lease will be construed to be cumulative, and not one of them is exclusive of the other. Landlord may pursue any or all such remedies or any other remedy or relief provided by law, whether or not stated in this Lease. 13.03. Knowing Employment of Undocumented Workers. Tenant acknowledges that Landlord is required to comply with Chapter 2264 of the Texas Government Code, enacted by House Bill 1196 (80th Texas Legislature), which relates to restrictions on the use of certain public subsidies. Tenant hereby certifies that Tenant, and any branches, divisions, or departments of Tenant, does not and will not knowingly employ an undocumented worker, as that term is defined by Section 2264.00](4) of the Texas Government Code. In the event that Tenant, or any branch, division, or department of Tenant, is convicted of a violation under 8 U.S.0 Section 1324a(l) (relating to federal criminal penalties and injunctions for a pattern or practice of employing unauthorized aliens, Landlord may terminate this Lease upon written notice to Tenant within sixty (60) days after the conviction (subject to any appellate rights that may lawfully be available to and exercised by Tenant). ARTICLE 14. NOTICES 14.01. Notices. Any notice, demand, request or other communication hereunder given or made by either party to the other shall be in writing and shall be deemed to be delivered whether actually received or not, when deposited in the United States mail, postage prepaid, certified or registered mail, return receipt requested, addressed to the parties hereto at the respective Ground Lease—City to A HF Page 19 of 22 addresses set out below, or at such other address as they may hereafter specify by written notice so given. (a) If to Landlord: City Manager City of Fort Worth 200 Texas Street Fort Worth,TX 76102 With a copy to: City Attorney City of Fort Worth 200 Texas Street Fort Worth, TX 76102 (b) If to Tenant: American Quarter Horse Foundation 1600 Quarter Horse Drive Amarillo, Texas 79104 Attention: Executive Vice President With a copy to: American Quarter Horse Association Chief General Counsel 1600 Quarter Horse Drive Amarillo, Texas 79104 ARTICLE 15. GENERAL PROVISIONS 15.01. Survey. Tenant, at Tenant's sole cost and expense, shall survey the Premises ("Survey") and provide the Survey to Landlord prior to the start of the Tenn. The Survey shall consisting of a plat and field notes describing the Premises, prepared pursuant to a current on-the-ground staked survey performed by a registered public surveyor or engineer satisfactory to Landlord. The Survey shall (i) be certified to Tenant and to Landlord, its successors and assigns, (ii) reflect the actual dimensions of and the total number of square feet within the Premises, net of any portion thereof lying within a publicly dedicated roadway or a utility easement, (iii) identify any rights-of-way, easements, or other encumbrances by reference to applicable recording data, and (iv) include the Surveyor's registered number and seal, and the date of the Survey. The legal description of the Premises on the survey obtained by Tenant shall then be added to and incorporated into Exhibit "A" of this Agreement, and shall control in the event of discrepancies between it and any preliminary description of the Premises shown on Exhibit "A". Within sixty (60) days of the issuance of a Certificate of Occupancy for the Building, Tenant shall provide Landlord with an as-built surveyof the Premises showing the location of all improvements constructed thereon. 15.02 Assignment and Sublease. Tenant may not sell or assign its leasehold estate, or any portion of it, without the prior written approval of the Landlord. However, Landlord approves the sublease of a portion of the Building to the Association for the use permitted by Section 3.01. Ground Lease—City to AOHF Page 20 of 22 15.03. Right of Entry and Inspection. Tenant must pen-nit Landlord or its agents, representatives, or employees to enter the Premises for the purposes of inspection; determining whether Tenant is complying with this Lease; maintaining, repairing, or altering the Premises; or any other reasonable purpose. 15.04. No Partnership or Joint Venture. The relationship between Landlord and Tenant is at all times solely that of landlord and tenant and may not be deemed a partnership or a joint venture. 15.05. Force Maieure. If constructing the Improvements or curing any default (other than failure to pay any amount due hereunder or perfonning any other covenant or term is delayed by reason of war, civil commotion, act of God, governmental restrictions, regulations, or interference, fire or other casualty, or any other circumstances beyond Tenant's control or that of the party obligated or pennitted under this Lease to do or perform the tenn or covenant, regardless of whether the circumstance is similar to any of those enumerated or not, each party so delayed is excused from performance during the delay period. 15.06. No Tennination on Bankruptcy. Bankruptcy, insolvency, assignment for the benefit of creditors, or the appointment of a receiver will not affect this Lease as long as Tenant and Landlord or their respective successors or legal representatives continue to perfonn all covenants of this Lease. 15.07. No Waiver. No waiver by either party of any default or breach of any covenant or tern of this Lease may be treated as a waiver of any subsequent default or breach of the same or any other covenant or tenn of this Lease. 15.08 Governing Law. This Lease shall be governed by and construed in accordance with the laws of the State of Texas. 15.09 Performance of Agreement. The obligations under the tenns of the Lease are performable in Tarrant County, Texas, and any and all payments under the tenas of the Lease are to be made in Tarrant County, Texas. 15.10 Venue. Venue of any action brought under this Lease shall be in Tarrant County, Texas if venue is legally proper in that county. 15.11 Severability. if any provision of this Lease is held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability will not affect any other provision, and this Lease will be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. [SIGNATURES APPEAR ON FOLLOWING PAGE] Ground Lease—City to AOHF Page 21 of 22 CITY OF FORT WORTH AMERICAN QUARTER HORSE FOUNDATION, a Texas non-profit corporation 7 Assistant City M4dager Name: Title: CW,, '%z APPROVED AS TO FORM AND LEGALITY: , Assistant City AttoriYey M&C: /1-0,-27�0 1295: goiq ATTEST: ryJ x i ' t Secretary rt City, of Fort Worth Contract Compliance Manager: By signing I acknowledge that I am the person responsible for the monitoring and administration of this contract, including ensuring 11 perfor aanc d-repartn requirements. Name of Emplo Title 0MCIAL RECORD CITY SECRETARY Ground Lcase—City to Aohff= K WORTH TX Noe 22 of'22 s EXHIBIT"A" PREMISES MONTGOMMYST. N00"291221W 754.05 60.01Y (7" 7IF- SWMwE MA ------------------------ I A t4 60.W S OMIN'S 2UAT -T34.!W I OF11-03% GEMYST. m C3 C3 DAM 0a M5 lam ey-Hom �.: nu ,dlAw'l Inc Qp MAW. KHA NVESTERN HERMCE CHECKED;AI.0 SITE PLAN PARKING GARAGE D.. MA Na:08120� EXHIBIT"B" COMMENCEMENT DATE MEMORANDUM COMMENCEMENT DATE MEMORANDUM THIS MEMORANDUM is made as of ,by and between City of Fort Worth,Texas,a home- rule municipal corporation("Landlord")and the American Quarter Horse Foundation, a 501(C)(3)corporation ("Tenant"). Recitals: WHEREAS,Landlord and Tenant are parties to that certain Ground Lease dated (the "Lease")for certain leased premises(the "Premises")located at 1400 Gendy, Fort Worth,Texas 76107. WHEREAS, Tenant is in possession of the Premises and the Term of the Lease has commenced. WHEREAS, Landlord and Tenant desire to enter into this Memorandum confirming the Commencement Date,the expiration date of the Term,and other matters under the Lease. NOW,THEREFORE,Landlord and Tenant agree as follows: 1. The actual Commencement Date is 2. The actual expiration date of the Term is Capitalized terms not defined herein shall have the same meaning as set forth in the Lease. CITY OF FORT WORTH AMERICAN QUARTER HORSE FOUNDATION, a Texas non-profit corporation By: Assistant City Manager Name: Title: APPROVED AS TO FORM AND LEGALITY: Assistant City Attorney Ground Lease—City to AOHF Page 27 of 27 City of Fort Worth, Texas Mayor and Council Communication DATE: 10/29/19 M&C FILE NUMBER: M&C 19-0276 LOG NAME: 21AQHA GROUND LEASE SUBJECT Authorize Execution of a Ground Lease Between the City of Fort Worth and the American Quarter Horse Foundation for the Purpose of Developing,Constructing and Operating a Facility to Include a Museum to be Located at 1400 Gendy,Fort Worth,Texas 76107,Authorize a Partial Waiver of Rent,and Find That the Partial Use of the Facility as a Museum Serves a Public Purpose(COUNCIL DISTRICT 7) RECOMMENDATION: It is recommended that the City Council: 1. Authorize the execution of a Ground Lease between the City of Fort Worth and the American Quarter Horse Foundation for the purpose of developing,constructing and operating a facility to be located at 1400 Gendy, Fort Worth,Texas 76107; 2. Authorize a waiver of the portion of the rent that is proportional to the square footage of the facility used for a public museum;and 3. Find that the waiver of such rent serves to carry out the public purpose of collecting,preserving,and presenting to the public objects, materials,and information of cultural and historical significance for education and enjoyment,and that adequate controls are in place through the Ground Lease to carry out such public purpose. DISCUSSION: Approval of this Mayor and Council Communication authorizes the City of Fort Worth(City)and the American Quarter Horse Foundation(Tenant) to enter into a Ground Lease for a 50 year initial term with five 10-year automatic renewal terms on approximately 0.60 acres, more or less,of unimproved land located at 1400 Gendy, Fort Worth,Texas,on the Will Rogers Memorial Center campus. The American Quarter Horse Foundation will be permitted to use the property to develop,construct and operate a building to house a public museum known as the American Quarter Horse Hall of Fame and Museum,or similar name,and to sublease of a portion of the building to the Association for its world headquarters,and for purposes ancillary to the operation of the Building,and for no other purpose without the written consent of the City.Tenant anticipates subleasing a portion of the Building to the Association at a fair market value rental for the purposes of operating the Association's world headquarters. Rent consideration will be based on fair market value, however,a percentage of the rent will be waived based on the portion of the building to be used for a museum, based on the public purpose served of collecting,preserving,and presenting to the public objects,materials,and information of cultural and historical significance for education and enjoyment. The remaining rent will be fair market value with rent credits being provided based on any of the following: • Annual Events Credit o Credit of 25%of rent for each year that the AQHA Youth World Championship Show and the AQHA World Championship show are held in Fort Worth now and during the term of the lease o An additional 25%credit may be requested by Tenant for additional events or shows held in Fort Worth and based on a calculation made by the Public Events Department to demonstrate the economic impact to the City of Fort Worth of a minimum of$25,000 dependent on number of attendees(in state and out of state),length of the event,number of hotel rooms booked and the cost of facilities booked • Donation of Property to be utilized and accepted by the City on behalf of the Fort Worth Police Department Mounted Patrol or the Fort Worth Herd o Eligible items include horse trailers or horses The Tenant may construct improvements on the Leased Premises in compliance with the permitted use however the City must approve plans prior to construction. The Tenant must achieve substantial completion of the improvements no later than 36 months from commencement of construction. Tenant shall own the improvements, provided that upon the expiration or termination of the Lease,the improvements shall become the property of the City. The City will be responsible for the design of the public improvements including sanitary sewer,water,storm water infrastructure,and road improvements. Tenant will be responsible for securing the appropriate zoning,licenses,certificates and permits necessary for the intended use of the leased property. FISCAL INFORMATION/CERTIFICATION: The Director of Finance certifies that the Public Events Department is responsible for the collection and deposit of funds associated with the lease. Submitted for City Manager's Office by. Kevin Gunn 2015 Originating Business Unit Head: Steve Cooke 5134 Additional Information Contact: Roger Venables 6334 Jean Petr 8367 MAYOR AND COUNCIL COMMUNICATION MAP 21AQHA GROUND LEASE Council District 7 ' = r � f j trt - UNCASTEWM. r • IKZMM * ++ ' f � f Proposed Ground Lease with American Quarter Horse Foundation P . X44I_ J, till Jam• I i ! - • t . t r J CR i y 11 r 1 0 IM I W E $a { i Feet 0 {yy�250 500 1,000 1 FORT WORTH Copyright 2019 City of Fort Worth.Unauthorized reproduction is a violation of applicable laws.This product is J P for informational purposes and may rat have been prepared for or be suitable for legal, nngineering, or General Location surveying purposes. It does not represent an on-th"round survey and represents only the approximate relative location of property boundaries.The City of Fort Worth assumes no responsibility for the accuracy of said data.