Loading...
HomeMy WebLinkAboutIR 7608 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7finA 14�0",*,0 To the Mayor and Members of the City Council May 26, 1992 X, Subject: PROPOSED LEASE AGREEMENT FOR CASA MANAMA THEATRE Attached for City Council review is a proposed lease agreement with Casa Manana Musicals, Inc. ( "Casa Manana" ) for use of Casa Manana Theatre. I . Background On March 1, 1958, the city issued $500,, 000 in 25-year general obligation bonds to construct Casa Manana Theatre. Retirement of these bonds occurred in 1983, with principal and interest payments totaling $704 ,500 over the life of the bonds. The original lease agreement, dated June 20, 1958, called for Casa Manana Musicals, Inc. to pay $28,180 per year for twenty-five years. These payments would have been sufficient to cover all debt service on the bonds. However, there were at least eight amendments to the original agreement. These amendments altered the annual lease payment provision and extended the term of the agreement. The amendment dated February 24, 1975, reestablished that "a sufficient amount of money will be collected as rental to meet the debt service payment requirements associated with the demised facilities. " This amendment changed the annual lease payment to $25,000 per year and extended the term of the agreement to December 31, 1989. On January 27 , 1977, the City Council deferred until September 1977, the lease payment due for the year 1976. On January 3, 1978, the City Council again amended the agreement to waive the $25,000 lease payments due for the years 1976 and 1977 . A review of receipts from Casa Manana shows that the city has received no payments since 1975. Through the prior lease agreement, as amended, a total of $372,600.77 in lease payments was credited against the debt service on the bonds. Thus, a balance of $331, 899.23, ($704,500 - $372,600.77 = $331,899.23) remains due to the city under the terms of the prior lease agreement, as amended. In March 1987, Casa Manana requested that the city council waive the $250, 000 owed in back rentals for the period 1978-1987 . They based this request on the grounds that although they had not made any required lease payments, they had expended more than $280,000 in maintaining and improving the theatre during that time period. In response, the City Attorney issued an opinion stating that the L-ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. :z6os 5 0 R'. To the Mayor and Members of the City Council X Subject: PROPOSED LEASE AGREEMENT FOR CASA MANAMA THEATRE city could not waive the back rentals. The City Attorney did state that the city could extend the term of the agreement, establish a schedule of annual payments, and allow the cost of future improvements to be credited against the prior lease payments owed. Since the 1987 request for waiver of prior lease payments, Casa Manana has continued to maintain and improve the facility at no expense to the City. On December 31, 1989, the lease agreement expired with $331, 899.23 in prior lease payments remaining outstanding. II. Proposed New Lease Agreement City staff has been negotiating with Casa Manana for several months to prepare a new lease which recognizes the financial commitment made by Casa Mariana while also guaranteeing that the City recovers the prior lease payments due. The major provisions of the proposed agreement are discussed below. 00,11 A. Term The proposed lease agreement begins on January 1 , 1990 and extends for twenty years with two five year renewal options exercisable upon the mutual consent of both parties. Casa Manana has plans for a capital funding drive to undertake a major renovation of the theatre building. These plans have been on hold until a lease agreement guaranteeing their long-term tenancy of the building is approved. Should Casa Manana complete a renovation of the theatre, the cost of which exceeds $2 .5 million, the two renewal options become automatic, making the term thirty years. B. Maintenance Responsibilities The tenant will be responsible for all maintenance costs associated with operating and maintaining the theatre. This includes maintenance, repair and replacement of the electrical and internal plumbing systems, as well as the heating, ventilation and air conditioning systems. The city does retain the responsibility to maintain the grounds surrounding the theatre. The Park and Recreation Department currently provides this service throughout the Cultural District. C. Prior Lease Payments and Annual Payment -ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7608 X0 via" .Ako ,o4 , To the Mayor and Members of the City Council X Subject: PROPOSED LEASE AGREEMENT FOR CASA MANANA THEATRE In recognition of Casa Manana assuming responsibility for the cost of all major maintenance and improvements, the agreement allows the tenant, on an annual basis, to request a credit for such expenditures against the prior lease payments owed. After review of the materials submitted by Casa Manana, city staff will determine the actual amount credited each year. During negotiations, representatives of Casa Manana expressed their desire to have a nominal annual rental payment to allow them to undertake their capital funding drive. If successful, this effort will result in a multi-million dollar renovation to the city owned facility. In consideration of this request, the annual rent for the term of the agreement is $1,200. However, if by April 1, 1997, the tenant has not accumulated credited expenses at least equal to the $331,899.23 in prior lease payments owed, the agreement requires a annual fee of $25,000 until the prior lease payment amount is paid and/or credited in full. This $25,000 fee is in addition to the annual rent. D. Parking The proposed lease agreement includes the parking lot directly north of the theatre as part of the leased premises. In addition, it grants Casa Manana access to an additional parking area defined as the lower level of the parking garage directly south of the theatre. When utilizing this additional parking area, the tenant is responsible for providing security personnel. Also, Casa Manana is allowed to charge its patrons a per vehicle parking fee in this additional parking area. The agreement calls for Casa Manana to collect the fee and pay to the city 75% of the revenues after payment of the security costs . All revenue received by the city will be dedicated to the debt service requirements on the bonds used to finance the construction of the garage. At this time, Casa Manana is not charging its patrons for parking in the lower level of the adjacent parking garage. Ill . SUMMARY The proposed lease agreement is a compromise solution which benefits the City by eliminating any potential expenses associated with the maintenance and improvement of the thirty-five year old theatre building while assuring that Casa Manana Theatre remains a important component of the Cultural District. The lease benefits ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7608 OPP To the Mayor and Members of the City Council X OPTS Subject: PROPOSED LEASE AGREEMENT FOR CASA NANANA THEATRE Casa Manana Musicals, Inc. by allowing them the flexibility to repay the prior lease payments owed through continued maintenance and improvement to the facility, while also giving them the long term stability necessary to plan and undertake a multi-million dollar renovation of the city owned theatre. Should Casa Mananals renovation plans become a reality, both parties to this lease agreement will benefit greatly, not to mention the community wide benefits associated with a newly renovated Casa Manana theatre. If the City Council has no objections to the lease agreement as proposed, staff will prepare a M&C recommending approval of the agreement for next week's agenda. Bob Terrell Acting City Manager V:010 WORT".TEXAS ISStjF[) By THE CITY MANAGER LEASE AGREEMENT This LEASE AGREEMENT is made and entered into this day of , 1992, by and between the City of Fort Worth, a municipal corporation located in Tarrant County, Texas, hereinafter referred to as "Landlord", and Casa Manana Musicals, Inc. , a Texas non-profit corporation, hereinafter referred to as Tenant". W I T N E S E T H ARTICLE I PREMISES AND TERM Section 1.1. Demised Premises. Landlord leases to Tenant and Tenant takes from Landlord the following property, collectively referred to as the "Demised Premises"; (a) The building known as Casa Manana Theater and the Casa Manana Warehouse erected at and known by the street address of 3101 W. Lancaster, Fort Worth, Tarrant County, Texas; and (b) all the equipment, fixtures, furnishings, design, decor, decorations, installations appurtenances, and personal property which has been placed, installed, and erected in said space by Landlord; and (c) the land, including the parking area immediately north of such Casa Manana Theater and the premises immediately surrounding the building, which parking and premises are more specifically described in Exhibit "A" attached hereto and outlined in red on the plat attached hereto as Exhibit "B". Section 1.2. Commencement; Term. The term of this lease shall begin on the first day of January 1990 (the "Commencement Date") and shall expire December 31, 2010, subject to earlier termination as hereinafter provided (the "Term"). The term may be renewed for two successive five year periods by the mutual written agreement of the parties; provided, however, that if Tenant completes structural improvements (as defined in Section 3.2 of this lease) to the Demised Premises during the initial Term, which improvements cost at least $2.5 million, the two renewal terms will be automatically effective. ARTICLE 2 RENT Section 2.1. Annual Rent During Ter . Tenant shall pay to Landlord, at the City Hall of Fort Worth, Texas an annual rent of TWELVE HUNDRED AND NO/100 DOLLARS ($1200.00) . This amount shall be due and payable on January 15 of the year following the lease year. Section 2.2. Prior Lease Payments. Tenant and Landlord acknowledge that a debt in the amount of $331,899.23 is owed by Tenant to Landlord under the terms of a previous lease agreement dated June 20, 1958, which lease agreement has been amended and extended, and which expired effective December 31, 1989. Landlord does not waive its entitlement to receive this amount, and this amount is hereby brought forward and made payable during the term of this Lease Agreement, as the "Prior Lease Payments" to be paid as set out in Article 4 hereof. ARTICLE 3 MAINTENANCE AND IMPROVEMENTS Section 3.1. Maintenance. Except where otherwise. expressly provided herein, it is understood and agreed that the Demised Premises and all improvements thereon shall be operated and maintained at no expense to Landlord and that Tenant shall operate and maintain, at its sole expense, the Demised Premises, including buildings and improvements, in a condition at least equal to the condition of the Demised Premises at the commencement of the term of this lease. Specifically, Tenant shall be responsible for performance of all items of "Major Maintenance", as follows: (i) upkeep and repair (including replacement) of the roof, exterior walls, foundation, exterior canopies, gutters and water spouts, truck loading facilities and structural components of the Demised Premises, internal plumbing, electrical systems, utility services extending to the service connections within the Demised Premises, heating, ventilation and air conditioning systems, and Tenant shall promptly repair any damage to such improvements. AIN Landlord shall continue to provide grounds maintenance services, including the irrigation system, at the level existing at the commencement of the term of this lease. Landlord shall also be responsible for maintaining the external plumbing extending from the structure to the service main. Tenant shall also perform such routine, operational maintenance and housekeeping as is necessary to carry -on Tenant's business, including but not limited to window glass replacement, janitorial service and regular servicing of mechanical and electrical systems. This routine maintenance shall not be considered Major Maintenance or Improvements as that term is defined in Section 3.2. Section 3.2. Improvements By Tenant. Tenant may perform, at Tenant's expense, both non-structural and structural improvements ("Improvements") to the Demised Premises, "Non-structural improvements" include but are not necessarily limited to the following: interior painting, carpeting, and replacement of theater seating and lighting. "Structural Improvements" shall include but not necessarily be limited to the following: construction of additional structures on the demised premises or construction of additions to existing structures on the demised premises, and parking and vehicular access improvements. No major maintenance or Structural Improvements shall be performed by the Tenant unless and until the plans and specifications for same have been reviewed and approved in writing by Landlord, which approval will not be unreasonably withheld. All such plans and specifications, and the Structural Improvements constructed in connection therewith, must conform to all local , state and federal codes, laws, and regulations now in force or hereinafter prescribed by authority of law. Section 3.2. Liens, and Bonds. Tenant shall (i) keep the Demised Premises at all times during the term hereof free from all mechanic's liens and other liens of like nature created or claimed by reason of transactions made by Tenant and (ii) at all 3 times fully protect and indemnify Landlord against all such liens or claims which may ripen into such liens and all expenses of Landlord arising from such liens or claims. Tenant agrees that at any time it undertakes any Major Maintenance or construction of any Structural or Non-Structural Improvements in excess of $25,000, it shall, at its own cost and expense, cause to be made and executed by the qonstruction contractor two separate bonds, in accordance with Article 5160 of the Revised Civil Statutes of Texas as follows: (a) Prior'to the date of commencement of construction, the contractor shall furnish a contract surety bond in a sum equal to the full amount of the construction contract awarded. Said bond shall guarantee the faithful performance of necessary construction and completion of improvements in accordance with approved final plans and detailed specifications, and shall guarantee the Tenant and Landlord against any losses and liability, damages, expenses, claims, and judgments caused by or resulting from any failure of the contractor to perform completely the work described as herein provided; and (b) Prior to the date of commencement of construction, a payment bond in a sum equal to the full amount of the construction contract awarded. Said bond shall guarantee payment by the contractor of all wages for labor and services engaged and of all bills for materials, supplies and equipment used in the construction of said improvements. The bonds shall be joint obligee bonds, naming the city of Fort Worth and Casa Manana Musicals, Inc. Tenant shall also require its contractors to carry construction insurance sufficient to insure against loss or destruction during the construction period. ARTICLE 4 CREDIT FOR TENANT EXPENDITURES AND PAYMENTS Section 4.1.(a) . Credit for Major Mai tenan-P and Improvements. During the period beginning on the commencement date and ending December 31, 1996, to the extent the Tenant performs any Major Maintenance or make any structural or non-structural improvements, as discussed in Article 3, Tenant shall have the right to obtain credit for such approved expenditures (the "Expenditures") on a dollar for dollar basis against the amount owed for Prior Lease Payments, as set out in Section 2 .2. 4 (b) By January 31st of each Lease Year, Tenant shall submit a request for credit of Expenditures accomplished during the preceding Lease Year, together with all necessary supporting documentation, including copies of paid invoices and/or cancelled checks. Landlord shall have the right to request any additional documentation it deems necessary to verify such Expenditures. After review by the City Manager, - or his designee, an adjustment will be made to the Prior Lease Payment amount. By March 1st of each Lease Year, Tenant will be notified of the adjusted Prior Lease Payment amount. Section 4.2.(a) . Additional Annual Payment. Beginning in Lease Year 1997 and continuing for the remainder of the Term, or until the Prior Lease Payment amount is paid in full, whichever occurs first, Tenant will pay to Landlord an annual payment of TWENTY-FIVE THOUSAND AND no/100 DOLLARS ($25,000.00), unless the Prior Lease Payment amount is paid to Lease Year 1997. This payment is due on the 1st day of April of each year, and is hereinafter referred to as "Annual Payment". This Annual Payment amount will be credited against the Prior Lease Payments on a dollar for dollar basis. The Annual Payment is in addition to payment of the Annual Rent. (b) During this period, Tenant is entitled to continue to obtain credit against the Prior Lease Payments for its approved Expenditures. The Annual Payment due on April 1st will be reduced on a dollar for dollar basis by the amount of preceding Lease Year Expenditures allowed for credit by Landlord. If the amount of credited Expenditures exceeds the Annual Payment due, future years' annual payments will be reduced by the amount of the excess. ARTICLE 5 USE; SIGNS; PARKING Section 5.1. Use. Tenant shall use and occupy the Demised Premises as a recreational and entertainment facility for entertainment, education, civic or cultural purposes, such 5 purposes including but not limited to the presentation of plays, musicals, operas, operettas, concerts, competitions or any other type of performance, the presentation of pictures, speeches and A1% lectures, the conducting of meetings of any group and any similar use for which the building is suitable. Landlord warrants and represents that the Demised Premises may lawfully be used for said purposes during the term of this lease. Section 5.2. Signs. Tenant shall have the privilege of placing on and in the Demised Premises such signs as Tenant deems necessary and proper in the conduct of Tenant's business; provided that all signage shall conform to the sign code of the City of Fort Worth. Section 5.3.(a) Use of Additional Parkins area. In addition to the area in Exhibit "A", Tenant may use the Additional Parking Area defined as the lower level of the parking structure located directly south of the Demised Premises, as identified in Exhibit 91COV, said Additional Parking Area containing approximately 400 parking spaces. Tenant's use of the Additional Parking Area shall be without additional charge, other than the rental as describedl*in Article 2 hereof. Access to the Additional Parking Area shall be through the gate at the southwest corner of the fence separating the Demised Premises from the Will Rogers Memorial Center complex, as identified in Exhibit "C". At all times during which the Additional Parking Area is being utilized, Tenant, will , at Tenant's expense, provide security personnel at the access gate to manage traffic flow and direct traffic to the Additional Parking Area, and Tenant guarantees that the access gate will be locked once the Additional Parking Area is cleared of vehicles. In the event that space is available, Tenant may use the upper level of the parking structure directly south of the Demised Premises without additional charge, other than the rental as described in Article 2 hereof. Landlord reserves the right to use a portion of the Additional Parking Area, when necessary, for events at the Will 6 Rogers Memorial Center, provided that the Tenant is notified at least thirty (30) days in advance. Landlord will use its best efforts to provide substitute parking facilities, either an the remaining portion of the parking structure directly south of the Demised Premises or on the parking lot immediately adjacent to and west of the Demised Premises. Notwithstanding the above, Landlord may permit other persons to use the Additional Parking Area during the time each year when the Southwestern exposition and Live stock show is holding its Stock Show and Rodeo. Section 5.3.(b) Parking Fees. Landlord grants Tenant the right to charge a per vehicle fee for parking in the Additional Parking Area. Should Tenant charge a parking fee in the Additional Parking Area, Tenant shall pay to the Landlord seventy-five percent (75%) of the revenues, after payment of parking security costs, resulting from said fee. Tenant will pay all revenues due to Landlord by the 15th day of each month for the preceding month. Along with this payment, Tenant shall 000k, submit a report specifying on which dates a fee was charged and the gross parking revenues and parking security expenses " for the preceding month. Any parking revenues received by Landlord will be deposited in a separate fund dedicated to debt service payments an the outstanding bonds used to fund construction of the parking structure which includes the Additional Parking Area. Parking revenues will not be credited against the Prior Lease Payments. Section 5.3. (c) Future Parkin Policies. Landlord reserves the right to alter its policy regarding paid parking in the Cultural District. if a comprehensive cultural District Parking program is created, Tenant's right to charge a per vehicle parking fee in the Additional Parking Area will be rescinded. Also, the Additional Parking Area access provisions of this contract are subject to negotiated revision should a comprehensive parking program be instituted. 7 ARTICLE 6 ASSIGNMENT AND SUBLETTING Section 6.1. Tenant shall have the right, without Landlord's consent, to grant concessions or licenses for sale of any or all of the merchandise, products, food, beverages, and items within the Demised Premises deemed necessary by Tenant for the presentation of musicals, plays and other performances held in the Casa Manana Theatre. Section 6.2. Tenant shall have the right, with Landlord's consent, which will not be unreasonably withheld, to assign this lease or sublet the Demised Premises or any part thereof. Section 6.3. If this lease is assigned or if the Demised Premises or any part thereof is sublet, such assignment or subletting shall be upon and subject to all of the terms, covenants, and conditions contained in this lease, and Tenant shall continue to remain liable thereunder. Upon any subsequent assignment, each subsequent assignee shall continue to be and remain liable hereunder. Within thirty (30) days after the execution and delivery of any such assignment Tenant shall furnish to Landlord a duplicate original of the assignment which shall contain an assumption by the assignee of all of the obligations of Tenant under this lease. ARTICLE 7 BASIC UTILITY SERVICES Section 7.1 Utilities. Landlord warrants and represents that there is, or that Landlord shall supply, sufficient basic utility service lines and piping to the Demised Premises (including electricity, water, gas, and sanitary sewer) to service the electrical system and equipment, appliances, and fixtures currently installed in the Demised Premises for Tenant's requirements for lighting and for the operation of the Demised Premises for Tenant's uses and purposes. All charges for utility services provided to the Demised Premises which shall be paid for by Tenant. 8 ARTICLE 8 INDEMNITY AND INSURANCE Section 8.1 Indemnification. Tenant covenants and agrees to indemnify, hold harmless and defend the Landlord, its officers, agents, servants and employees from and against any and all claims or suits for property damage or loss and/or personal injury, including death, of whatsoever kind or character, arising out of or in connection with, directly or indirectly, the leasing, occupancy and use of the Demised Premises and any and all activities conducted thereon, or the sale and/or consumption of any food, beverage or other item hereunder from and against any and all injury or damage to said Demised premises or any other property of Landlord arising out of or in connection with, directly or indirectly, and all acts or omissions of Tenant, its officers, agents, employees, contractors, subcontractors, patrons, guests, licensees, invitees or trespassers. Section 8.2. Liability Insurance. Tenant shall at all times during the term hereof, maintain a Commercial General Liability Policy of insurance with limits not less than $500,000 per occurrence, combined single limit for bodily injury or death and property damage, $1,000,000 aggregate. said policy shall include the City as an additional insured. Tenant shall furnish to Landlord a certificate of insurance verifying such coverage with a confirmation that such policy shall not be subject to cancellation except upon thirty (30) days' prior written notice to Landlord. Landlord may, at its option, also require Tenant to submit a copy of the policy or policies in effect as well as proof of payment of premiums. Section 8.3. Insurance for Contents of Buildings. Tenant shall be responsible for maintaining any policy of insurance which will insure against loss of property owned by Tenant which is located on the Demised Premises. Section 8.4. Fire- and (a) Landlord shall maintain a policy of fire and extended insurance policy to cover the Casa Manana Theater Building and those structures immediately adjacent there to, exclusive of that 9 structure known as the Casa Manana Warehouse, all as described on Exhibit B. Such insurance policy shall be for full replacement value. (b) Tenant shall maintain a policy of insurance to cover losses to the structure known as the Casa Manana Warehouse, delineated in Exhibit A. Section 8.5. Hazardous Use. Tenant will not permit the Demised Premises to be used for any purpose which would render the insurance thereon void or the insurance risk more hazardous and will use its best efforts to use the Demised Premises and to store its property in such a manner as to minimize risk of loss by casualty, it being acknowledged that the use of the Demised Premises in the proper and ordinary conduct of Tenant's business for the purposes set forth herein shall not be considered in violation of this Section. ARTICLE 9 DAMAGE BY FIRE OR OTHER CASUALTY section 9.1. Substantial Cggp-@j_ty. if the Demised Premises are materially damaged or rendered materially untenantable by fire or other casualty or if the Demised Premises are so damaged or so rendered untenantable by fire or other casualty that the repair, restoration, or rebuilding of the Demised Premises would require more than sixty (60) days for completion, Tenant will have the option, exercisable by written notice given to Landlord within ninety (90) days after the occurrence of such fire or other casualty, to terminate this lease upon a date specified in said notice, and in such event the term hereof shall expire in the same manner as if the date specified in said notice were the date herein originally specified for the expiration of the term. If Tenant does not give such notice, Landlord, at its sole discretion, may proceed to repair, restore, and rebuild the Demised Premises to its former condition within one hundred eighty (180) days from the date of such damage; provided, however, that Landlord will be under no obligation to expend any amount on rebuilding or repairing in excess of the amount of 10 insurance proceeds actually received by Landlord. Tenant may pay for additional repairs in accordance with Articles 3 and 4 of this lease. The rent will abate from the date of such fire or other casualty until the repairs, restoration, and rebuilding are completed. if Landlord chooses not to rebuild or restore the structure, the lease will terminate. If this lease is terminated pursuant to notice as hereinabove provided, no rent or additional rent shall be payable by Tenant for any period after the date of such fire or other casualty and the same shall be apportioned as of such date and any rent paid for any period beyond such date shall be repaid to Tenant. Section 9.2. Minor Casualty. if, the Demised Premises are damaged by fire or other casualty, where the damage can be repaired within a sixty (60) day period, Landlord will proceed with reasonable diligence to repair such damage; provided, however, that Landlord will be under no obligation to expend any amount on repairs in excess of the amount of insurance proceeds actually received by Landlord. Tenant may pay for additional repairs, in accordance with Articles 3 and 4 of this lease. If the Demised Premises are rendered untenantable by such damage, rent will be abated proportionally during the period during which repairs are being made. ARTICLE 10 DEFAULT - REMEDIES Section 10.1. Default , Notice, Termination. If Tenant defaults in the payment of rent or defaults in the performance of any of the terms, covenants, or conditions of this lease, Landlord may give to Tenant written notice of such default, and if Tenant does not cure any rent default within thirty (30) days, or other default within forty-five (45) days, after the giving of such notice (or, if such other default is of such nature that it cannot be completely cured within such forty-five (45) days, if Tenant does not commence such curing with such forty-five (45) days and thereafter proceed with reasonable diligence and in good faith to cure such default) , then Landlord may terminate this II lease on not less than thirty (30) days written notice to Tenant, and on the date specified in said notice the term of this lease shall terminate, and Tenant shall then quit and surrender the Demised Premises to Landlord. If this lease shall have been so terminated by Landlord, Landlord may at any time thereafter resume possession of the Demised Premises by any lawful means and remove Tenant and other occupants and their effects. Tenant shall remain liable for all Prior Lease Payment amounts which have not been credited or paid in accordance with this lease, which obligation shall not terminate upon termination for default. ARTICLE 11 CONTRACTING REQUIREMENTS Section 11.1. Minority and Women Business Enterprise Commitment. It is the policy of the City of Fort Worth to involve disadvantaged business enterprises (DBEs) in all phases of its procurement practices and to provide them an equal opportunity to compete for contracts for construction, provision of professional services, purchase of equipment and supplies and provision of other services required by the City. ' Therefore, Tenant agrees to incorporate City council Policy No. 148, dated March 13, 1990, and all amendments or successor policies thereto, into all contracts of the Tenant and will further require all persons or entities with whom it contracts to comply with said Policy. A true and correct copy of City Council Policy No. 148 is attached hereto as Exhibit "D". Section 11.2. Contracting. Tenant shall manage the hiring, letting, contracting or franchising of any of the work necessary to fulfill any of its obligations or responsibilities under this lease. All such contracts paid for with funds subject to the crediting procedure described in Article 4 must be in conformity with the terms and conditions of this lease and all other laws, rules, regulations and policies of the City of Fort Worth, including requirements concerning competitive bidding for letting of contracts for improvements to public property. 12 ARTICLE 12 NOTICES 00pol Section 12.1. 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 duly given if hand-delivered or if mailed by registered or certified mail in a postpaid envelope addressed as follows: (a) If to Tenant: Casa Manana Musicals, Inc. 3101 W. Lancaster Fort Worth, Texas 76107 (b) If to Landlord: City Manager City of Fort Worth 1000 Throckmorton Street Fort Worth, Texas 76102 or at such other addresses as Tenant or Landlord, respectively, may designate in writing by notice pursuant to this Section 12.1. ARTICLE 13 QUIET ENJOYMENT Section 13.1. Quiet Enioyment. Landlord covenants that if and so long as Tenant makes all payments required in this Lease Agreement and performs the terms, covenants, and conditions on Tenant's part to be performed, Tenant shall peaceably and quietly have, hold and enjoy the Demised Premises for the term of this lease, subject to the provisions of this lease. Section 13.2. Title Warranty. Landlord warrants and represents that Landlord has good and marketable title to the real property of which the Demised Premises form a part, free and clear of all liens and encumbrances. ARTICLE 14 MISCELLANEOUS PROVISIONS Section 14.1. No Waiver. The failure of either party to insist on strict performance of any term, covenant, or condition hereof, or to exercise any option herein contained (other than the options provided for in Section 1.2) , shall not be construed as a waiver of such term, covenant, condition, or option in any other instance. Section 14.2. Written Modification. This lease cannot be changed or terminated orally, but only by an instrument in 13 writing signed by both parties. Section 14.3. Access to Premises. Landlord may enter the Demised Premises at any reasonable time or reasonable notice to Tenant for the purpose of inspection and to repair the Demised Premises as required herein. Section 14.4. Adjacent Construction. Landlord must notify Tenant of plans to construct or repair improvements on adjacent property owned by Landlord and the scheduling thereof at least thirty (30) days prior to the commencement of the construction or repairs, except in the case of emergency repairs. Landlord acknowledges that Tenant's use of the Demised Premises is affected by heavy machinery and other aspects of such repair or construction and therefore agrees to provide Tenant with both (i) alternative routes of ingress and egress to the Demised Premises, (ii) substitute parking adjacent to the Demised Premises; both in a manner suitable for Tenant's use of the Demised Premises. Section 14.5. Relocation. Landlord shall not have the right to relocate Tenant or substitute space for the Demised Premises. Section 14.6. Captions. The captions in this lease are included for convenience only and shall not be taken into consideration in any construction or interpretation of this lease or any of its provisions. Section 14.7. Partial invalidi-t-Y. if any provision of this lease, or the application thereof to any person or circumstances, shall to any extent be held invalid or unenforceable, the remainder of this lease, or the application of such affected provision to persons or circumstances other than those to which it is held invalid or unenforceable, shall not be affected thereby, and each provision of this lease shall be valid and shall be enforced to the fullest extent permitted by law. It is further the intention of Landlord and Tenant that if any provision of this lease is capable of two constructions, one of which would render the provision void and other of which would render the provision valid, then the provision shall have the 14 meaning which renders it valid. Section 14.8. Perpetuities _s�a vin g _ �91 ause. in the event 000ft that it is determined that any portion of this lease is controlled by or subject to the Rule Against Perpetuities, whether due to a future vesting of a right or the granting of an option herein, then in that event the parties hereto agree that this lease agreement shall be modified and amended, if- necessary, in such a manner so as to not violate the Rule Against Perpetuities. in addition, the parties hereto agree that, for purposes of the Rule Against Perpetuities, the lives against which the Rule Against Perpetuities would be measured would be the life of any Interested Person (as hereinafter defined) . The term "Interested Person" shall mean one of the following: M any individual serving as mayor or a city councilman of Landlord on the Execution Date; (2) any individual serving as an officer, director, or trustee of Tenant of the Execution Date; or (3) any individual who is a child or grandchild of any of the above-described individuals living on the Execution Date. 001k Section 14.10. Execution Date. The term "Execution Date" as used herein shall mean the latest date upon which either party hereto executes this lease agreement. LANDLORD: DATE EXECUTED BY LANDLORD: CITY OF FORT WORTH 1992 ATTEST: By: City Secretary Printed Name: Title: APPROVED AS TO FORM AND LEGALITY: City Attorney TENANT: DATE EXECUTED BY TENANT: CASA MANANA MUSICALS, INC. 1992 BY: Printed Name: Title: 15