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HomeMy WebLinkAboutAUGUSTA RIVERFRONT LIMITED PARTNERSHIP ...J> : ..,..,.i... . , J~=JF. /13:<0 RESOLUTION RESOLUTION AUTHORIZING CITY COUNCIL OF AUGUSTA TO ENTER INTO CERTAIN AGREEMENTS WITH REGARD TO THE DEVELOPMENT BY AUGUSTA RIVERFRONT LIMITED PARTNERSHIP OF A HOTEL AND OFFICE BUILDING COMPLEX IN THE AREA BOUNDED GENERALLY BY REYNOLDS STREET, NINTH STREET, ELEVENTH STREET AND THE LEVEE AND TO ACQUIRE AND GRANT CERTAIN EASEMENTS IN CONNECTION THEREWITH, AND TO ENTER INTO CERTAIN AGREEMENTS WITH REGARD TO THE CONSTRUCTION, OPERATION AND MAINTENANCE BY CITY COUNCIL OF AUGUSTA OF A CONVENTION CENTER AND PARKING FACILITY TO BE LOCATED IN SAID AREA AND TO ENTER INTO CERTAIN AGREEMENTS WITH REGARD TO THE ACQUISITION AND EXCHANGE BY CITY COUNCIL OF AUGUSTA OF CERTAIN REAL PROPERTY AND ABANDONMENT OF CERTAIN STREETS AND ALLEYS IN CONNECTION THEREWITH AND TO ENTER INTO A LEASE OF APPROXIMATELY 8,000 SQUARE FEET OF SPACE IN SAID OFFICE BUILDING. WHEREAS, on September 14, 1987, the City adopted a resolution setting forth its intent to participate in the development by Bankers First Community Development Corporation and the Webb Group of the Augusta Riverfront Center by undertaking the construction of a conference center at a cost not to exceed $3,900,000.00, a public parking deck at a cost not to exceed $3,816,000.00, an extension of the Riverwalk at a cost not to exceed $890,000.00 and certain infrastructure improvements on land to be dedicated to public use at a cost not to exceed $1,300,000.00; and WHEREAS, the development of said project with certain revisions and modifications thereto, which project includes the construction of a hotel and office building to be financed in part by a Urban Development Action Grant (UDAG) granted to City by the united States Department of Housing and Urban Development and in : ~ : part by private funding, has been undertaken by the Augusta Riverfront Limited Partnership, Inc.; and WHEREAS, the development of this hotel and off ice complex will serve as the cornerstone of a truly major revitalization of downtown Augusta; and WHEREAS, in order to facilitate said project it is necessary and desirable that City Council of Augusta agree to construct and equip said conference center at a cost not to exceed the sum of $3,900,000.00 and to construct and equip said public parking deck and certain on-site parking facilities at a cost not to exceed $3,816,000.00 and to construct said infrastructure improvements which will be located on property dedicated to public use at a cost not to exceed the sum of $1,300,000.00 and agree to the operation and maintenance of the same and to grant and receive certain reciprocal easements all as more particularly set forth in the Construction, Operation and Reciprocal Easement Agreement attached hereto as "Exhibit A"; and WHEREAS, pursuant to said UDAG it is necessary and desirable that the City enter into an agreement wi th Augusta Riverfront Limited Partnership substantially in such form and containing substantially the terms and conditions set forth in the UDAG City/Developer Agreement attached hereto as "Exhibit B"; and WHEREAS, in order to facilitate the construction of said parking facilities and convention center it is necessary and desirable for City to enter into a Construction Management Agreement with Bailey & Associates containing substantially the / '.. . .. terms and provisions set forth in the Construction Management Agreement attached hereto as "Exhibit C". WHEREAS, it is also necessary and desireable that the ci ty agree to acquire the property upon which said convention center and parking facilities are to be located under substantially the same terms and conditions set forth in proposed Exchange Agreement to be entered into between City and Bankers First Corporation a copy of which is attached hereto as "Exhibit D"; and WHEREAS, said Exchange Agreement calls for the City to abandon that portion of Macartan Street lying North of Reynolds Street containing 0.18 acre and Tatnall Alley between Tatnall Street and the Levee containing 0.06 acre which are shown and designated as Parcel F and Parcel G, respectively, on that plat dated May 10, 1989, prepared for Augusta Riverfront Limited Partnership by Cranston, Robertson & Whitehurst, which said parcels will not serve any useful public purpose after commencement of construction of said project; and WHEREAS, the city desires to enter into a lease agreement whereby the City would agree to lease 8,000 square feet of office space in said office building for a period of 10 years after completion of construction at an annual base rent not to exceed $16.40 per square foot with annual adjustments based upon the Consumer Price Index. NOW THEREFORE BE IT RESOLVED that the Mayor and Clerk of Council are authorized to execute and deliver on behalf of City Council of Augusta documents in substantially such form as those attached hereto as Exhibit A, B, C, and D and to undertake and "" .... ..,.. . 1.. " r. " carry out any and all duties, obligations and responsibilities imposed upon City pursuant to said documents and to take such other actions and enter into such other agreements and execute and deliver such other documents on behalf of City as the Mayor may deem reasonably necessary or desireable in order to effect the foregoing. BE IT FURTHER RESOLVED that at such time as construction of said hotel and office building commences, said portions of Marcartan Street and Tatnall Alley shall have no further public use or purpose and City Council of Augusta shall abandon the same by appropriate resolution. BE IT FURTHER RESOLVED that the Mayor and Clerk of Council are authorized to enter into on behalf of the City a lease agreement under which the City agrees to lease 8,000 square feet of office space in said office building for a period of ten years after completion of construction at an annual base rental rate not to exceed $16.40 per square foot with annual adjustments during the lease term based upon the Consumer Price Index and upon such other terms and conditions as the Mayor may deem acceptable to the City. DONE IN OPEN COUNCIL UNDER THE COMMON SEAL THEREOF, THIS f~ day of ~ f , 1989. ATTEST: ~~tD.~ CLERK OF COUNCIL ., -, . , - A -[x'~LI- .. (. i .-',.. " 0 \.. :.... -..' '"' L. .. ~.\:. i ;," r~:- '- . , 4 ~ .......1 .. - ...... , ~!~,<\o ,. I I CON'STRUC'~ION, OPERA TING A.~D RECIPROCAL ['J:'.:..<;'''(. EASEMENT AGREEI'1EN'f Lr ::~ j'T,: ~~:. ~7..}:'c[.~. TH1S COt\STRUCTIOL~, OPERATING AND RECIPROCAL EASJ::MEN'f Ac.;KJ::t:Mt.;N'r ("Agreement"), executed on this the day of 1989, by and between the CITf~~GUSTA. G~ORGIA AUGUSTA RIVERFRONT LIMITED PARTNERSHIP, A (the ItC1cy"), and Georg 1a Limited Partnership (the t1Developerlt). WIT N E SSE T H: WHERE-AS, the City is the owner of the levee. and adjacenc land lying along the banks of the Savannah River in downtown Augusca, Georgia, a. portion of which (the "Project Riverwalk Property") is described on Exhibi~ itA" attached hereto, incorporated herein t and made a parr: hereof by reference, and has developed on por~ions thereof certain sidewalk, landscaping and other improvements knovm as llRiverwalk11. and , WH~K~AS, the City is the owner of certain air rights (the '~ir Rig hts") above real property Ollffied by the. Authori cy, which a.i r rights are more particularly described on Exhibil: "alf attached hereto, incorporated hereint and made e part hereof by reference; and WHt:REAS, the City has acquired certain property.. (che "Parking Deck Tract") located in downtown Augusta, Georgia) which propen:y is more particularly described in Exhib i c I'C" aceached i1ere co t incorpOrated herein and made a part hereof by reference; and _~GL(;'\)EF: R DR',)IS, F'.A. ,~.~ 'f TEL t'~[I. 404 251 7152 Jun 06.89 14:10 P.03 WHEREAS, Developer has acquired title to an approximately acre parcel, (the "Hotel Tract") which parcel is more particularly described in Exhibit "D" attached hereto, incorporated herein and made a part hereof by reference; and WHEREAS, Developer has acquired title to certain property (the "Park:tng Tract"), which property is more particularly described on Exhibit "1::" attached hereto, :tncorporated herein and made a part hereof by reference, which Parking Tract is to be leased to the City or its assignee, Downtown Development Authority of the City of Augusta, as set forth in Section 9.1 hereof; and WHEREAS, Developer has acquired title to an approximately acre parcel (the "0:t:t:tce Tract") which parcel is more particularly described on Exhibit "F" attached hereto, incorporated herein and made a part hereof by reference; and WHEREAS, The Air Rights, the Hotel Tract, the Office Tract, the Parking Tract, and the Parking Deck Tract (the Parking Tract and the Park:Lng Deck Tract co llecti vely the "Authority Tract") together are hereinafter referred to as the "Project Site"; and WHEREA~, the City has applied .tor and received a $7,5oZ,454.00 Urban Action Development Grant (the ItUDAG Grant") under Section 119 of the Housing and Community Development Act ot 1974 for the purpose of funding a portion of the cost of financing the development of the hotel, ot!ice building and remaining components Of a mixed use project (the. "Project") on the Project Site, the Project also to include a conference center and parking !acilitj_es; and ,t'. ,\.~ ,I . \ :' / v/ '-1_1.-1 \........ r, "-'- r -I .,. .... ._' ~ ; I :.:....!-. ,''' 1_, . _ ,_.... I... _ _ _ ._' I: . - ~'-' . ": ':' :: . ,~' t_. . !_.:I- - -....' . \ , -c<~. , .. WHEREAS, the parties desire to enter into i this 'Agree.ment to coordinate the joint development and operation of said Project in H manner which complies with the requiremencs, terms, and conditions of the UDAG Grant. NOW, THEREFORE, in consideration of the premises and the mutual agreements a.nd covenants contained herein, and for other good and valuable cons1deracion, the receipt of which is hereby acknowledged, the City, the Authority and the Developer, intending co be legally bound, agree as follows: ARTICLE 1. DEFINITIONS AND EXHIBITS. Section 1.1. Certain Defined Terms. As used in this Agreement, the following terms shall have the following meanings: "Authority" shall refer to the Downtown Development Authority of the City of Augusta, Georgia, and its successors and assigns in ownership and rights to possession of the Authority Tract. "Governmental Proj ect" shall re fer to tbe Conference Center and the Parking Improvements, collectively. ltAuthori ty Tract II shall re fer to the Parking Tract and the Parking Deck Tract, collectively'. . ~.0 'ICity" shall refer to the CitYAof Augusta, Georgia. "Ci:.l_~~1cillary Improvements" shall refer to the improvements described in Section 5.1 he.reof. I'Conference Center'l shall refer to the improvements described in Section 4. 1 (a) hereof to be cons eructed byehe Cicy in the Air Rights. Page 3 " '. " j'~ t . , I1Consumer ! Price I i In dex" s ha 11 re fer to the Consumer Price Index for all Urban Gonsumers(l967 - 100) all Cities published by the Bureau of Labor Statistics of the United States Department of Labor, or, if such index is no longer published, the index IDOse nearly comparable thereto. lIl)eveloper II shall refer to Augus ca Riverfront Limited Partnership, a Georgia limited partnership, and its successors and assigns in o'Wnership of the H.ote.l Tract, the Parking Tracc and the Office Tract. Improvemel1tsll shall re fer to the "Governmenc:.al Project Conference Center and the Parking Improvements, collectively. 'IHotel" shall refer to the hotel facility to be construct.ed and operated upon the Hotel Tract by Developer pursuant to the terms of this Agreement. "Hotel Imorovementsl1 shall refer to the improvements described , in Section 2.1 hereof to be constructed by Developer on the Hotel Tract. "Hocel Trace" shall refer co the certain parcel of land containing approximately described in Exhibit IID11 hereto. acres and being more p~rcicularly "Initial Term" shall refer to the period commencing the date. , hereof and expiring on December 31, 2025. 'Pave 4. ~:.. , t ~ "Kitchen" shall refer to that area denominated as such on Preliminary Design Plans prepared by Smallwood, Reynolds, Stewarc, Stewart & Associates and all facilities and fixtures located therein as said area may be modified by the final "as -buil t" plans prepared for said area after same has been constructed; said area shall inc 1 ude the right of ing re s sand egres s to suell area [rom the Conference Ce.nter and the Hotel, to and from the loading dOCK and the food service facilities, and co and from che loading dock and a public roadway. Said rights of ingress and egress may be located and relocated by the Developer from time to time, bur. shall noc be located in any manner which shall unreasonably impair the operation of the Conference Cenr.er, the Hotel or the Parking Improvements. "Master Development Plan" shall refer to that certain site plan for the Project prepared by Smallwood, Keynolds, Stewart, Scewarc & As soc iates dated 19 l;l cU}JY of 'Which has been initialed by each of che parties hereto, and copies of which are to be maintained by each of the parties hereto at their principal offices. "Mortgage" shall refer to a deed to secure debt, mortgage or other security instrument encumbering any Tract or any portion chereo f. "Mortgagee" shall refer to the holder of any Mortga.ge. "Office lmprovernen ts" sha 11 re fe r co che improvemen cs deseribe.d in Section 3.1 hereof to be conscructed by Developer on che Office Tract. Page 5 GLQVER & DRVIS, P.R. . TEL I'~[I. 404 251 7152 Jun 06.89 14:11 P.04 .. ! , . I "Offtce Tract" shall refer to that certain parcel 01 land containing approximately ____ acres and being more particularly described in Exhibit "F" hereto. "Parking Deck" shall refer to the two-level pa.rking deck described in Section 4.1 (b) to be constructed by the Authority on the Parking Deck Tract. "Parking Deck Tract" shall refer to that certain parcel of land owned by the City and containing approximately acres a.nd being more particularly described in Exhibit "C" hereto. "Parking Improvements II shall refer to the Parking Deck and the surface parking lot improvements described in Section 4.1 (b) to be constructed by the Authority on the Authority Tract. "Parking Tract" shall refer to that certain property owned by the Developer and leased to the City or its assignee, the Authority, which property contains approximately _ acres and is more particularly described in Exhibit "E" hereto. "Party" shall refer to the City or the Developer. Collectively, the "Parties". "Prelimtnary Conference Center Design Plans" shall refer to those plans and specifications for the construction ot the Conference Center more particularly identitied in Exhibit "G" attached hereto. "Preliminary Design Plans" shall refer to . the Preli.minary Conference Center Design Plans, the Preliminary Hotel Design Plans t the Preliminary Office Design Plans, and the Pre.liminary Parking Design Plans, collectively. Page 6 - . 1.''''' '" 1:)' r. i" . 1'1!_i. ( - . "Pr!~?:minary Hotel Des~n Plans" shall refer to those certain ?lans and specifications for construction of che Parking Improvements more particularly described in E.xhibit I'H" attached :1e reto. "prel iminary Office Des ign Plans" shall re fer to those cert a in plans and specifications for construction of the Office Improvements, more part: icularly described in Exhibit "I" a ttacbed hereto. "Preliminary Parking Design Plans" shall refer co those certain plans and specifications for construction o[ the Parking Improvements more particularly described in Exhibit "Jrl atcached hereto. "~roiect" shall refer to the Hotel Improvements, the Office Improvements. the Governmental Project Improvemen ts and the Cic:.y Ancillary Improvements, collectively. "proj ect S i tel' shall re fer to the Air R.ights t the Rote 1 Tract t the Oftice Tract and the Authority Tract, collectively. IITerm" shall mean the Initial Term plus any extension thereof pursuant to Article 17 hereof, during which this Agreement remains in force and effect. "UDAG Grant" shall refer to that certain Urban Development Action Grant Agreement Number B-87-AA-13-0095 issued to the City of Augusta, Georgia by the U.S. Department of Housing and Urban Development on November 30, 1987, as amended. "Unavoidable Delays" shall mean delays due to scrike.s, aCl:S of God, governmental restrictions or preemption of labor or material, 'D"~,,, ., I enemy action, insurrection, i fire or casualty or other events beyond the reasonable control of the Parcy responsible for such performance. Section 1.2. Exhibits. Attached hereto are the. following Exhibits, which Exhibits are incorporated into and made a part of Exhibit "A 11 this Agreement for all purposes: Exhibit "B" Exhibit t 111 Yt l.. Exhibit: liD II Exhibit "E" 1::xhibit "1"'11 Exhibit "H" Exhibit IIJ" Exhibit ilK" Legal Description of Project Riverwalk Property Legal Description of Air Rights Legal Description of Parking Deck Tract Legal Description of Hotel Tract Legal Description of Parking Office Tract Legal Description of Office Deck List of Preliminary Conference Center Design Plans List of Preliminary Hotel Design Plans List of Preliminary Office Design Plans Exhibit ilL" List of Preliminary Parking Design Plans ARTICLE 2. HOTEL IMPROVEMENTS. Sect ion 2.1. Description of Hotel Im2roveroents. Developer shall construct. on the Hotel Tract a first-class hotel containing 225 guest rooms, restaurant(s), lounge(s), a swimming pool, meeting roomsJ appropriate landscaping, driveways and walkways} and other facilities appropriate for a first-class hotel, together with all fur nishing S J fixtures and equipment necessary for the operation 0 f Such improvemencs (t.he such improvements as a first-class hot.el. "Bocel Improvements") shall be constructed in conformit)' with the Master Development Plan and substantially in accordance wit.h the Preliminary Hotel Design Plans. Page 8 , , Section 2.2. Completion of Hotel Improvemen'Cs. Developet' sha.ll commence construction of the Hotel Improvements on or before December 31, 1989. Developer will cause construction of the Hotel Improvemencs 'Co proceed diligent 1y and in an orderly lind coord 1nated manner. Subject to Unavoidable Delays, Developer shall use its be.sc efforts to complete r:he Hotel Improvemencs and open th~ Hotel for business with the public not later than April 1, 1991. Such date, or such ocher date thereafter as the Hotel shall actually open for business \Yir:h the public, is referred to herein as the "Hotel Opening Date.." Not\Yithstanding the foregoing, Developer shall not be required to open the Hotel for business \Yith the public until such time as the Conference Center and the Parking Improvemenc8 have been completed and made available for use by Hotel guests. Section 2.3. Funding of Construction Costs. Up to $ of the costs of construction of the Hotel Improvements shall be furnished by the City with a portion of the proceeds of the UDAG Grant. Such funds shall be advanced to Developer by the City pursuant to r:he terms and conditions of those certain loan documents dated 1989, between Developer and the City. The balance of the COBT:S_ oi.constructiOl1 of the Hotel lmprovemencs shall be paid for by equity or private financing arranged by Developer. AATICLE 3. OFFICE IMPROVEMEN'fS. Section 3.1. Description of Office Improvements. Developer shall construct on the Office Tract a class A office building conta.ining approximacely 128) 000 net renr:able square feet: of space, Page 9 "'- GLOVER 8 DRVIS, P.R. TEL I'~ [I . 404 251 7152 Jun 06.89 14:12 P.OS ... i , I i together with appropriate landscaping, driveways a.nd walkways, and together with all fj~tures and equipment necessary for the operation of such building and other improvements as a class A office building. Such improvements (the "Office Improvements") shall be constructed in conformity with the Master Development Plan and substantially in accordance with the Preliminary Office Design Plans. Sectton 3. L. Construction of Office Improvements. Developer shall proceed with the final design and construction of the Office Improvements in an orderly and coordinated manner. Subj ect to Unavoidable Delays) Developer shall use its best efforts to substantially complete the Office Improvements not later than April 1, 1991. Section 3.3. Funding of Construction Costs. Up to ~ of the costs of construction of the Office Improvements shall be financed by the City with a portion of the proceeds of the UDAG Grant. Such funds shall be advanced to Developer by the City pursuant to the terms and conditions of those certain loan documents dated ) 1989) between Developer and the City. The balance of the costs of construction of the Office Improvements shall be paid for by equity or private financing arranged by Developer. ARTICLE 4. GOVERNMENTAL PROJECT IMPROVEMENTS. Section 4.1. Description ot Governmental Project improvements. (a) The City shall expend up to Three Million Nine Hundred Thousand Dollars ($3,900,000.00) toward the cost ot construction in the Air Rights ....Q..f.. the following improvements (the "Conference. Center"): Page 10 . . GLOVER b DRVIS, P.R. T EL I'~(I. 404 251 7152 Jun 06.89 14;1~ P.06 A first-class conference center containing approximately a 10,500 square foot ballroom, 4,200 square feet of break-out meeting space, conference rooms, pre-function areas, restrooms, telephone banks, storage. areas, an outdoor terrace, . and other fac iliti.es and amenities appropriate for a first-class conference center, together with all furnishings, fixtures and equipment necessary for the operation of such facility as a first-clas s conference center. The conference center shall be constructed in conformity with the Development Plan and j- substantially in accordance with the Preliminary Conference Center Design Plans. (b) The City shall contribute up to Three Million Eight Hundred Sixteen Dollars ($3,816,000) towards the cost or construction on the Authority Tract of the following Improvements"): A two-level parking deck (the "Parking Deck") on the Parking improvements (the "Parking Deck Tract under and adjacent to the Conference Center building and containing approximately 600 parking spaces, p1us an illuminated surface parking lot located adjacent to the Conference Center and containing approximately 175 parking spaces, together with related curbing, curb cuts, driveways providing access to the adjace.nt public streets and appropriate landscaping. The Parking lmprovementB shall be constructed in conformity with the Master Development Plan and substantially in accordance with the Preliminary Parking Design Plans. GLOVER g DAVIS, P.A. TEL I.~D. 404 ~51 715~ Jun 06,89 9:10 P.13 \c. .:... t Section 4.2. Construction of Governmental Project Improvements. It is acknowledged and agreed that the Governmental Project Improvements must be constructed simultaneously with the Hot~l Improvement:s and must be substancially completed on or before the Hotel Opening Date. Bailey & Associates (hereinafter referred to as "Construction Hanager") has concl:'acted wich Developer co act 8S exclusive Construction Manager for the Hotel Improvements and che Office Improvements. The City and the Authority shall enter into construction management agreements with the Construction Manager whereby Construction Manager shall render all services needed in connection with the design and construction management of the Conference Center and the Parking Improvements, including administration) supervision and coordination of che bidding, award, execution) and performance of a general construction contract. Fu:nding of Construction Costs. Construction of Section 4.3. t.he Conference Center shall be at the City I s sole cost and expense only 80 lon~ as such cost: does not exceed the SuIll of $3.900,000.00. In the event that the C09tS of construction of said Conference .Genter should for any reason exceed the sum of $3.900,000.001 the ~Developer shall pay any and all such additional cosel:> as and when the same shall become due and payable. ,Construction of the Parking Improvements shall be at the Cicy's sole cost and expense only so long as such costs of construction do not exceed $3.816,000.00. In che event such costs of conscruction ~o e~ceed $3,~16,000.OO for any reasonl Developer agrees to pay any PAQe 12 -. L-'I' IE F' ,', II H- I I I".. F' A (J.. .... ,_ v,", v.: . ',.,' ':::0 ~ .. TEL I'~[I. 404 251 7152 Jun 06,89 14:13 P.O? I.. r f I such additional costs as and when the same shall become due and payable. The term "costs of construction" or "construction costs" as used in this section shall include, specifically, but not exclusively, all sums paid by on behalf of City or the Authority to any contractor, subcontractor, third-party laborer or governmental supplier performing any such work and all architectural, engineering, surveying and legal fees incurred in connection therewith, all premiums for insurance coverage required to be maintained hereunder prior to completion of construction, all reasonable costs, fees and expenses incurred in obtaining financing for the Parking Improvements in the amount of $3,816,000.OU through revenue bonds issued by the Authority and any other costs and expenses incurred by City in connection. with the construction of said Conference Center. Payment of any portion of such construction costs shall not entitle Developer to any ownership interest in said Conference Center or Parking Improvements. ARTICLE 5. CITY ANCILLARY IMPROVEMENTS. Section 5. 1 Description of City Ancillary lmprovements. The City shall Construct the following improvements in connection with the Project (the "City Ancillary Improvements"): (a) The City shall extend the "Riverwalk" project located upon and along the Savannah River levee from Eighth Street to a point where Tenth Street would intersect the levee if it continued in a straight line north from its intersection with Broad Street. Such GLOVER & DRVIS, P,R. TEL No, 404 251 7152 Jun 06,89 14:13 P.OS J. .f. f I ( 1 ! extension shall include tmprovements and landscaping comparable to that portion of the extsting Riverwalk project located between Sixth and Eigh~treets. (b) The City shall extend to and over the Hotel Tract, the Authority Tract and the Office Tract sanitary sewer and domestic water lines and storm drainage lines and facilities providing adequate capacity to service the requirements of the Hotel Improvements, the Conference Center and the Office Improvements. (c) The City shall resurface, re-light, landscape and otherwise upgrade and improve Ninth and Tenth Streets between Reynolds Street and the Riverwalk project in accordance with the Master Development Plan so as to complement the Hotel Improvements and the Office Improvements, respectively. Such improvements shall include construction of bricked turn-around areas shown on the Master Development Plan. Section 5.2. Construction of City Ancillary Improvements. The City shall coordinate construction of the City Ancillary Improvements to the maximum extent possible with the construction of the Hotel Improvements, the Governmental Project Improvements and the Office Improvements. Further, such construction shall be implemented pursuant to a schedule which will enable Developer, the City, and the Authority to maintain their respective construction schedules. Subject to Unavoidable Delays, the City, shall use its best effort to complete all City Ancillary Improvements on or before the Hotel Ope.ning Date. GtOV~R & DRVIS, P.R. TEL l'-lo. 404 251 7152 Jun 06,89 14:14 P.09 , f Section 5.3. Funding of Construction Costs. Construction of the City Ancillary Improvements shall be at the City's sole cost and expense, but in no event shall the City be required to expend funds therefor in excess of $5,100,UOO.00 for such City ancillary improvements referred to in subparagraph (a) of Section 5.1 above, and in no event shall the City be required to expend funds in excess of .$1,300,000 for such City ancillary improvements described in subparagraph (b) and (c) of said section. In the event such maximum sums are insufficient to construct all of the respective City Ancillary Improvements, the City shall determine those portions to be left unfinished after consulting with Developer. ARTICLE 6. GENERAL PROVISIONS REGARDING CONSTRUCTION. Section 6.1. Performance of Construction. Each Party shall perform its construction in accordance with the applicable approved plans therefor, with due diligence and in a good and workmanlike manner, using first class materials and in accordance with all applicable laws, ordinances, rules, and regulations of all governmental agencies and authorities having jurisdiction over such construction. In the performance of its construction, no Party shall materially interfere with any construction being performed by another Party, cause any other Party any delay in or increase in the cost of construction or their respective improvements, or impair the use, occupancy, or enjoyment of any other Party's improvements. If any construction on one Tract shall be in process at any time after the improvements located on any other Tract shall have opened for " i:;LCi')[F;.f; DRI,) IS, P. R . TEL t.~o. 404 251 7152 Jun 06,89 14:15 P.l0 business with the public, then the Party carrying on such cons truction shall erect or cause to be erected adequate painted construction barricades at leas t eight (B) feet in height substantially enclosing the area of construction until construction shall have been substantially completed. such Section 6.2. Liens. The Developer agrees that, in the event any mechanic I s lien or other statutory lien shall be filed during the term of this Agreement against all or any portion of the Project Site, the Developer shall pay and discharge the same or bond off or otherwise cause such lien to be discharged of record and shall indemnify and save harmless the other Party hereto and its successor and assigns from all losses, damages, liability, expenses or claims whatsoever (including reasonable attorney I s fees and the costs of defending against the foregoing) resulting from the assertion of any such liens. Section 6.3. Additional Construction. After the Project has been completed, Developer, and the City shall each have the right to make such alterations, modifications, expansions or additions to their respective Hotel and Office Improvements~ and Governmental Project Improvements which (i) do not materially change or alter the architectural elevations or design or the exterior building materials of the same, and (ii) do not impair access between and among the said improvements. Neither the City nor the Authority shall expand or materially alter or modify the Governmental Project Improvements at any time during the Initial i _ __ - - _ - '," _.._' '_:. :' . ~ _ r. .L -::" '. , J ,term without the prior Written approval of the plans expansion, alteration or modification by Developer, which shall not be unreasonably withheld. Section 6.4. Insurance. Each Party shall during the period of for sucl1 approval any construction, Tract ma.intain restoration or replacement of improvements on its builder I s risk insurance on a non-report ing, completed value basis with extended coverage endor~ement, or extend its fire and extended coverage insurance provided tor herein during any restoration or replacement when the aforemencioned builder's risk insurance is not applicable. All such insuranct! may, at the option of the Party obtaining it, contain a loss deductible provision of not more. than $250,000.00 for such insurance obtained by Developer and not more than $500,000.00 for any such insurance ,obtained by City. AKTICLE 7. OPERATION AND MAINTENANCE OF HOTEL IMPROVEMENTS. Section 7.1. ~ration of Hotel. Veveloper and/or its designee operator for the Hotel (the "Hotel Operator") shall open for business and initially operate the Hotel as an Omni Hocel pursuant to the terms of a franchise agreement with Omni Hotel Corporation. During the Term hereof, the Hotel shall be operated as a first-class hotel, and no operation or use shall be made, conducted or permitted within the Hotel which is inconsistent: with or detrimental to che reputation of the,Hote.l as a first-class hotel. Develope.r shall at all times comply with all applicable governmenca.l laws, ordinances, rules and regulations in the operacion of a Hotel. Page 17 GLUVtK ~ UHV1~, ~.H. I t:L I'~D. 404 1~,l fl:~~ ]LJrl G6.8S 9:13 ~'.lS "'," . " Section 7.2. Operation of Retail Space. An aggregate of not less than square feet of space located within the Hotel shall be used and operated at all times during the Term of this Agreemene for purpose s of re s taurants, lounges, a hea leh club, gi ft shops and magazine stands, and/or other retail purposes incidental and complementary to the operation of the Hotel. Developer agrees that it wi 11 not permit any tenant 0 f such retail space co 8 ell, distribute, display or offer for sale any item which is inconsistent with the quality of operation of the Hotel Improvements as established herein or which might tend to injure or detract from the moral character or image of the Hotel Improvements. Section 7.3. Maintenance of Hotel Improvements. Developer agrees to maintain and keep all Hotel Improvements, including landscaping associated with the. Hotel Improvement, in first-class condition and state of repair at all times. ARTICLE 8. OPERATiON AND MAINTENANCE OF OFFICE IMPROVEMENTS. Section 8.1. General. Developer shall operate and maintain the Office Improvements as a class A office building in compliance with all applicable governmental laws) ordinances and regulations. No operation or use shall be made) conducted or permitted within the Office Improvements which is inconsistent with. or detrimental to the reputation of the Project as a first-class business and meeting center. Developer agrees to maintain ehe Office Improvements, including related landscaping) in first-class condicion and repair at all times. Page 18 ~- - - . ... ...; ARTICLE 9. OPERATION AND MAINTENANCE OF PAKK1NG IMPROVEMENTS. Section 9.1. General. The ~ has contemporaneously herewith leased the Parking Tract from the Developer for a term equal to the Initial Term. The City hereby agrees that during the Term of this Agreement it shall operate or cause to be operated on the Authority Tract the Parking Improvements as a parking facility in accordance " t l~ ~, with the terms of this Agreement and ~uch uniform, t f: $ " ~ t II: { j p l' non-discriminatory rules and regulations as may be adopted from time to time by the .Citv or the Authority as its assignee. No barricades, curbs, gates, or other obstacles shall be erected which block or prohibit the free flow of traffic through the en trances, exit.s, ramps and driveways wit.hin t.he Parking Improvements; provided, however, that nothing herein shall prohibit (i) the eree tion of such curbs and other control or safety improvements devices which may be necessary to control and direct pedestrian and ~ .., .t 7; \1', , t' vehicular traffic within the Parking Improvements; ( ii) such ~~' ;I. '~.~ temporary closing of the Parking Improvements as may be necessary for the cleaning, repair and maintenance of the same as required -; ~. ... .~:. "E" ~ ~f . ., , from time to time; or (iii) the erection of such toll booths and/or entrance and exit gates as are required to limit access to the .' '~ Parking Improvements to authorized permittees and to collect rents due for the use of t.he Parking Improvements. Section 9.2. Rents for Space~. Throughout. theTerrn 0 f this ~. Agreement) tne li.t.y shall have the exclusive right: to set or cause . , ... j ~o be set the rent:s for use of the parking spaces within ~he Parking "l. Page IlJ ... ~ l.. [llvl E~' -g D R I.) IS, F.. R . TEL I'~o. ~ rn 14 1~ F'.ll 404 251 7152 Jun 06,d~ : ~ .. Improvements, provided that the City shall consult with Developer prior to establishing or changing such rates. The rent schedule shall be set in good faith with a view toward charging rents consistent with market demand and rates charged by parking facilities serving comparable improvements. The rent schedule shall be applied in a uniform and non-discriminatory manner except that nothing herein shall prohibit the charging of a premium for reserved parking spaces. Sec:t:Lon 9.3. Allocation of Spaces. The Parties acknowledge that as a public facility', the Parking Improvements must be available for use by members of the general public and that no more than ten percent (10%) 0 f the parking spaces may be reserved for exclusive use of Developer. .The City agrees that Developer may, at any time during the Term, upon agreement as to the rents to be paid therefor, designate up to ten percent (10%) of the total parking spaces :Ln the Parking Improvements as reserved for the exclusive use of Developer and/or it designees. Additionally, the City shall / \ designate' no less than 250 parking spaces within the Parking Improvements for first pr:Lority use by Hotel guests, not less than 450 parking spaces for first priority use by tenants of the Office Building and their employees and invitees, not less than 20 spaces for first priority use by customers of any retail space located in ? the Office Building and Hotel, and the balance for first priority Use by members of the general public. The City shall advise Developer of the location of such priority spaces and, consistent with its duty to make the ninety percent (9070) or more of the spaces which are not re.served available to members of the general public on a "first come, first served" basis, shall endeavor to preserve such spaces for use by the intended parties. Such spaces shall be located within the Parking Deck and the. surface parking 8n~Bl:; til::; conveniently as possible for the priority users thereof. such designated parking areas by Hotel guests and by employees and Use of invite.es of Office Building tenants shall be subject to all rules and regulations applicable to the Parking Improvements as may be in effect from time to time, including the payment of applicable parking cha.rges or rents. The City shall noc grant exclusive or priority rights to anyone other than the invitees and permittees of the Developer, Construction Manager or Conference Center Operator. S ec t ion 9. 4 . Special Parking Needs. It is recognized by the Ci~y that Developer may from time to time require additional parking spaces on a short-term basis in connection with special events or funccions to be held at the Hotel or the Conference Center. Wben such needs are identified, Developer or the Conference Center Operator shall notify the operator of the parking facilities as far in advance as possible., and such operator will use its best efforts to accommodate such requirements, provided that nOthing herein shall require or auchorize such operator to displace or remove from che parking areas rent-paying customers or others entitled to use the Parking Improvements. The parties acknowledge that: certain of the spaces will be leased on a long cerm basis (e.g., monthly) to Page 21 ", GLOVER & DRVIS. P.R. TEL t.~o, 404 251 7152 Jun 06,89 14:16 P.12 Developer and/or the operator ot the Hotel and to tenants of the Office Building; the City agrees that the lease rates therefor shall be in accordance with the provisions of action 9.2 above. Section 9.5. Maintenance of Parking Improvements. The City shall maintain the Parking Improvements, including related landscaping, in good, clean and sightly condition and repair, in such manner as will maintain the appearance of the parking area in substantially the same condition as when it i8 initially completed, normal wear and tear expected. Without the limitation of the foregoing, the City shall promptly repair all holes and cracks in concrete or paved surfaces, remove all papers, debris and refuse., wash or throughly sweep all paved areas as required, remove snow, ice, surface water and other obstructions, and clean and maintain lighting fixtures and relamp as necessary. The City shall also resurface and restripe the parking areas and refurbish directional signs, curbs and other components of the Parking Improvements from time to time as required. Section 9.6. Hours of Operation; Security. Except for temporary closing as permitted in Section 9.1 hereof, the Parking Improvements shall be kept open and lighted, and reasonable security service provided. ARTICLE 10. OPERATION AND MAINTENANCE OF CONFERENCE CENTER. Section 10.1. Operation by Designee of Developer. So long as the Hotel Improvements are operated as a hotel and prior to the expiration of the Initial term, the Conference Center shall be ;':1 L- l-,r..... ___ I., '..' ..." ',' .. '__.' , . I, . : ., '-' . ~ .... _ ~ . '.J II ' . . . ' .:", . ~ '_ ....:...:....t operated and managed by Developer through a qualified mana.gement. company selected and employed by the Developer and approved by che City, such approval not to be unreasonably withheld. Such operator of the Conference Cente.r shall be referred to herein as the "Conterence Center Operator". It is contemplated chat the , Conference Operacor may be the same entity that acts as the Hotel . , Operator. The Conference. Center Operator shall have discretion and ~ \ 1 i j control in the establishment of reasonable rules and regulations for the Conference Center, the establishment of reasonable fees and charges for use of the Conference Center facilities and for food and beverages and ancillary services, the employment and supervision of all personnel, accounting for the receipt and disbursement of funds, and all other activities relating to the operation of the Conference Center. 1n all such respects, the Conference Cencer Operator shall operate the Conference Center as a first-class meeting, conference and convention center which complements and enhances che operation J J ~ I , I 1 j of the Hotel, and shall not use, conduct or permit any use of the Conference Cencer which is disreputable or inconsistent with a first-class facility. F-egardless of anything cont.ained herein to :ehe contrary" the Conference Genter Operator shall make t:he Conference Center available for use by che City .and or any ,individual or any group on a first-come, first-served basis wdthout discrimination for sex, race, creed, color or national origin. As compensation for its se.rvices to be ~endered in management of the Conference Center, the Developer, (or, if Developer so Page 23 de signates ~ the Conference Cen ter Operator) shall receive e. management fee equal t:o all reve.nues from the operation of Conference Cencer other than fifty percent (50%) of che net revenue from the leasing of ballrooms and meeting room~ in the Conference Center which latter sums shall be held and distributed as described in Section 10.5 below. The amounts to be paid to Developer and held for or distributed to City shall be determined by a firm of certified public accountants on a period basis as agreed between City and Developer. Re~ardless of Anythlnf contained herein to the contra.ry. the fees charged for leasing ballroom. meeting rooms and .providins other facilities and services at the Conference Center phall be reasonable and in conformity with those being charged by similar conference facilities and such fees may not be waived Micheue consent of Citv. Section 10.2. Maintenance and Repair of Conference Cent:er. Developer shall) at its sole cost and expense (except as set forth in Section 10.5 below) ) be responsible for maintaining the Conference Center in good condition and repair) including) without limitation, the foundations, structural supports, exterior walls, interior walls and floors, ceiling s) and permanent: 1 ight ing fixtures, sp rinkler sye terns, pipes, wires and conduits within the walls, floors and above ceilings, roof, gutcers, downspouts, ucility lines, elevators) the heat:1.ng, ventilating and air conditioning system, and other major syscems and fixtures inst:.alled within the Conference Cencer, and tor all appropriate day-co-day or periodic I' 1)o~" ';If., ';LGI(,,~EF' -c; DA')I:?::, F'. A. TEL No. 404 251 7152 Jun 06,89 q , C'~, - . ';'L P.03 maintenance in connection with such items. Developer shall also, at its Bole cost and expense, keep the Conference Center and all furniture, fixtures and equipment in good operating condition and repair. Without limitation of the foregoing, Developer shall maintain ehe interior of the Conference Center (including wall, floor, and window coverings) and shall replace or repair any broken glass in doors or windows, replace interior light bulbs, and refurbish or replace from time to time as required all furniture. furnishings and equipment as are requisite or desirable for che efficient operation of a first-class conference center (including. Without limitation, china, glassware and silverware, tables, and chairs, linens, uniforms, POdiums, and staging platforms, artwork and decorative accessories). In addition, Developer shall be responsible for all appropriate day-to-day or periodic maintenance of the systems and equipment installed within the Conference Center. Developer shall also maintain all landscaping installed in and around the Conference Center in good, attractive and Sightly condition. In the event that any of such items become in need of Developer, maintenance or repairs, the City. may give written notice to the and the Deve Loper shall proceed to perform such Developer, Within thirty (30) days after written notice from the made Within a reasonable time after receipt of such notice. maintenance or repairs or cause such maintenance or repairs to be If the City) shall fail to make any repairs or commence any main tenance required of the Developer herein, or in the event of any emergency GkO~EP ~ ORVIS, P.R. TEL t'~o. 404 251 7152 Jun 06,89 9:47 P.02 which, in the opinion of the City, renders such notice impracticable, the City may, at ics option, make such repairs or perform such maintenance, in which event the Developer covenants to reimburse the City for the cost thereof and for five percent (5%) of said cost for administration fees (provided that the City shall not charge Developer any adminiscration fee in the event of emergency repairs or replacements). Section 10.3. Insurance. Notwithstanding anything to the contrary provided in Section 14.1 below, the City shall maintain at its sole cost and expense (i) general public liability insurance covering the premises, and (ii) fire and extended coverage insurance covering the Conference Center against risks of damage or lOBS by fire and ocher risks now or hereafter embraced by "extended cove.rage," so called, in a.n amount (subject to commercial availability) not less than the full replacement cost of the Conference Center, exclusive of the cost of excavations, foundations and footings, and all furniture, fixtures and equipment owned by the City and located therein subiect to a $500.000.00 deductible prnv:i I'd (')1"1. n HOtel Developer and/or Conference Center Operacor al so shall maintain appropriate liability and workers' compensation insurance relating to the operation of the Conference Center. Section 10.4. Taxes. The Developer shall pay all taxes, if any, levied against the Conference Center. 1-. L"rJ".1 ED c, .J "I.....~' r::.. I~:.x DR',)IS, P.R. TEL I'~[I. 404 251 7152 Jun 06,89 9:48 F' . 03, Section 10.5. Reserve for Maintenance and Capital Improvements. During the Term hereof, all of the sums to be retained by the City remaining after payment of the management fee as provided in Section 10.1 above [i.e., fifty percent (50%) of the net revenues from the leasing of ballrooms and meeting rooms in the Conference CencerJ, up to chat amount necessary to fund the Reserve Account (as defined below) to the Maximum Reserve Amount (as defined below) shall be maintained in 8. reserve for maintenance and capital improvements (the "Reserve Account"). Any of such amounts in excess of the Maximum Reserve Amount (as de fined below) shall be distributed to the City. The Reserve Account shall be maintained by the Conference Center Operator and to the extent Bums are available the.rein, shall be utilized to pay the costs of the items described or referenced in Section 10.2 above. The Maximum Reserve Account shall be that amount as shall be determined from time to time by Developer with the approval of City (which approval shall not be unreasonably withheld) to be sufficient for the proper maintenance and repair of the Conference Center during the ensuing ten (10) year period. ARTICLE 11. GENERAL PROVISIONS KEGARDING OPERATION. Section 11. 1 Compliance wi-ch Laws. Each Party ..r.e.spon ~i b 1 e for operating any improvements referred to herein shall operate its re. spective Improvements in compliance with all gove.rnmental requirements, laws, statutes, regulations and/or ordinances app 1 icab le to such Party's Improvements, Rnd rhp. pAr!"}' re ~pon5ib le PAPP. 27 ..... GLOVER & ORVIS, P.R. TEL I'~o. 404 251 7152 Jun 06,89 9:54 P.06 for ooerating the Bame shall keep in full force and effect at all times all governmental permits and licenses required for the use and operation of such Improvements. Section 11.2. Landscape Committee. establish a committee (the "Landscape The Parties hereby agree ~o Committee") in order to coordinate the formulation and implementation of an overall plan for installation of the complementary landscaping within the Project and the es tabl ishment of common landscape maintenance standards.. Each Party shall designate one person as its representative on the Landscape Committee by written notice to the other Parties. The Landscape Committee shall meet upon request from any party during the period of construction of the Project and thereafter on a periodic basis, but not less review the landscaping scheme problems or issues. Section 11.3. HVAC Operation. Insofar as certain of the Improvemencs of the Parties shall be internally connected through common corridors and passageways) Developer) in operating the air conditioning and hea.ring-'system for the H.otel Improvements and the Conference Center. shall operate such systems in a manner which will not unduly drain heat, ventilation or air conditioning from the Improvements of any other Party. Section 11.4. Advertising and Promotion. During all periods in which the Conference Center is operated by Developer pursuant to this Agreement, Developer shall be entitled to refer to and promote than once every year, in order to for the Project and any maintena.nce GLOVER & ORVIS. P.R. TEL t'~o. 404 251 7152 Jun 06.89 14:17 P.13 .. , I I the Hotel and Conference Center as a unified operation known as the "Augusta Riverwalk Hotel and Conference Center". The City and its affiliates, including the Chamber of Commerce and the Augusta-Richmond County Convention and Visitors Bureau, shall likewise. be entitled to refer to the Hotel and Conference Center by such name and to promote the same as a unified operation, subject to Developer's right to review and approve prolIlotional literature and advertising of the City and its affiliates with respect to the Hotel and Conference Center. Section 11.5. Kitchen. The Developer and the City have agreed - that a.s a part of its management of the Convention Center the Developer or its designe.e (anticipated to be the Hotel Operator) shall provide all food services for both the Hotel and the Conference Center. So lon~ as Developer shall provide food services to the Conference Center, Developer shall have exclusive ri~hts to tbe utl1-zation of the kitchen. City and Developer have agreed, however, that in the event that Developer or its designee fail to provide said food services so that same are unavailable for the operation of the Conference Center for a period of seven (7) days or more, then in such event the City or its designee shall have a non-exclusive license to utilize and operate the kitchen to service I I i I I i i 1 1 t f. the Conference Center. Said license shall continue until written notice is given by the Developer to the City stating a date certain or which the provision of food services to the Conference Center by the Developer or its designee will be resumed and the provision of Page 29 same is in fac t resumed on said date. Developer shall make said kitchen available to City at all times and shall maintain the same and a 11 app 1 iance sand fixtures contained therein in good working condition. In furtherance of the above agreement City and Developer have granted those re-ctprocal easement rights described in Sect:ton 12.4 below. ARTICLE 12. EASEMENTS. Section 12.1. Easement for Access and Parking. The City. as the owner of the Parking Deck Tract, hereby grants to Developer, ;,ts respective tenants, subtenants,concessionaires, licensees, employees, officers and invitees, and to the Conference Center Operation and its employees, agents, concessionaires, licensees and j.nvitees, non-exclusive, perpetual easements over, upon, across and through the Authority Tract for: (a) pedestrian and vehicular ingress to and egress from the Parking ~mprovements; (b) circulation, passage and parking of vehicles within the Parking Improvements; and (c) circulation and passage of pedestrians over and through such ramps, walkways, stairways, elevators and other facilities as may from time to time be included within the Parking Improvements; provided, however, that the persons permitted to use such easements by Developer shall be required to pay such parking charges or rents as may from time to time be in effect with respect to the Parking Improvements and shall be subject to the City's (or ,its designee I 5) rules and regulations regarding use of the Parking Page 30 bLLIVlk 0 LlHV1~. ~'.H. r EL I'~o. 404 251 7152 Jun 06,89 14:18 P.1S . , Improvements. I i Nothing in this Section 12.1 shall be deemed to restrict the Conference Center Operator from restricting access to the Conference Center. The easements granted under this Section 12.1 shall continue so long as the. Parking Improvements continue to exist. Enjoyment of the easements granted in this Section shall commence on the date the Parking Improvements are substantially completed and opened for business. The City agrees to open the Parking Improvements for business promptly after they are substantially completed and to keep them open for business thereafter during the Te.rm. Section 12.2. Construction Easements. Each Party hereby grants to each of the other Parties a temporary right, privilege and easement to enter upon their respective Tracts from time to time to construct the Hotel Improvements, the Conference Cente'!', the Park:l.ng Improvements~ the City Ancillary Improvements and the Office Improvements pursuant to the approved plans for such improvements. Each Party shall have the right to permit its contractors and subcontractors, agents and employees to use the easement granted for the aforesaid purposes. The easement granted herein includes the ../ right to" construct columns, footings and common ""alls. - Any utilization of the foregoing easement shall be made in such a manner as will not interfere with construction on the property of the other Parties. Such construction easement shall cease and terminate upon completion of construction of the Project Improvements. The J' construction and location of any common footings, underground supports and common walls shall be subject to approval of the final plans and specifications for such improvements by the Parties sharing such improvements. Page 31 G~.~I')f:F:, R DA',,)IS. F'. A. TEL t'~[I. 404 251 7152 Jun 06.89 q'C:7 - . --' I F: . 10 Section 12.3. Easemen ts for Underground Supports) Party Walls and Connection of Corridors. The City and Developer acknowledge I 'J that the Hotel Improvements may share common footings and underground supports (hereinafter referred to as the "Underground Supports ") and common walls (hereinafter re ferred to as the "Part)' v/ Walls ") with the Conference Center and the Parking Deck. Each of such Parties hereby grants to the other Party a non-exclusive easement for the construction and maintenance of openings in the walls between their respective Improvements at the locations shown by the Preliminary Hotel Design Plans) the Preliminary Conference Center Design Plans and the Preliminary Parking Design Plans in order to connect the corridors and passageways of such Improvements with one another, provided that the manner of connection shall be in accordance with generally accepted engineering and construction practice for improvements of such type and so as not to impair the structural integrity of the other 'Party' B Improvements, and provided that nothing herein, in and of itself, shall be deemed to create an easement for passage through any such connected corridors or passageways. All such easements shall continue so long as any portion of this Agreemenc shall remain effective and thereafter so long as c:he improvements benefited by such easements exist. The exercise of easement rights under this Section by any Party shall be conducted in such a manner as will minimize interference with t:he conduct of ~usiness by the other Party. Each of such Parties covenants that if all or any part of its Improvements are removed or PaRe 32 GL~V5R & ORVIS, P.R. TEL t.~o. 404 251 7152 Jun 06,89 9:57 P.11 , .... destroyed at any time when it is not required to restore and does not elect to res tore such Improvements, it will leave in p lace any foundations, footings or walls (or portions thereof) not removed or destroyed if", immediately before such removal or destruction, such foundations, footings or walls (or portions thereof) were shared jointly between such Party and the other Party. Should, in the reasonable opinion of either Party, the Party Wall or any portion thereof or the openings therein providing access between the Parties' respective Improvements require repair or rebuilding, the other Party sharing such Parcy Wall shall cooperate in such repair or rebuilding and shall cause such repair or rebuilding to be accomplished at a time convenient to both, with the cost of such repair or rebuilding to be borne in equal shares; provided that the cost of any such repair that may be occasioned by the neglect or wi 11 ful act of either Party shall be borne by that Party. The phrase "repair and rebuilding" as used herein shall not include ordinary maintenance and care such as painting and cleaning. Section 12.4. Ea.sement for AKitchen. The City hereby grancs to Developer an exclusive right, privilege and easement in that certain porcion of the Conference Center which is designed to be a portion of the "Kitchen and more particularly described and depicted in Exhibit "c" hereto, said easement being for the purpose of constructing, furnishing and operating within such easement area a kitchen which shall serve both the Hotel and the Conference Cencer. Nocwichstanding any provision of this Agreement to the Poo.:. ',\'~ GLO~E~ g ORVIS. P.R. TEL I'~o. 404 251 7152 ]un 06.89 14:18 P.16 contrary t Developer shall be solely responsible for the cost of matntaining, insuring, repairing and replacing the Kitchen and any and all persona I property from time to time located therein. The square footage of the Kitchen shall be included in the square footage of the Hotel for all purposes of this Agreement. The Kitchen shall be constructed by Developer in accordance with final plans and specifications prepared by Developer's architect and approved by City. The easement referred to above shall continue as long as the Kitchen is used for the operation of a kitchen serving the Hotel Improvements. The Developer hereby grants to City an exclusive right, privilege and easement in that certain portion of the Rotel which is designed to be a portion of the said Kitchen; said easement being for the purpose of constructing, furnishing and operating within such easement area said Kitchen which shall serve both the Hotel and the Conference Center. The easement granted herein shall continue as long as Developer shall fail to prov:Lde food service to the Conference Center as provided in Section 11.5 above and the use of the Kitchen is deemed necessary by the City to serve the Conference Center. Section 12.5. Easement for Attachment of Office, Hotel and Conference Center Improvements to City Improvements. The City hereby grants to Developer during the initial term a temporary easement onto and across the property of the City for the purpose of constructing and maintaining sidewalks, stairways and pedestrian bridges connecting such Parties r respective Improvements with the sidewalks and other improvements associated with the Riverwalk project, as such project :Ls to be extended along the portion of the . .r3 Lj:1 t,jE F: R D H t,) IS, F'. H . TEL I'~o. ~o~ 251 7152 Jun 06,89 9:59 P.13 Savannah River levee adjacent to the Project Site, such extensions to be constructed at the locations shown on the Master Development Plan or at 6uch other locations as may be subsequently agreed upon by the City and the affected Party. The construction of such improvements shall nOt be deemed in favor of the City or any member of the general public, but rather shall be for the sole and exclusive. use and benefit of Developer and Confe.rence Center Operator and their respective employees, invitees, licensees and permittees. Section 12,6. Easement for Access to Riverwalk. The Authority, as the owner of the Authority Tract, and the City, as owner of the Air Rights and the Project Riverwalk Property, hereby grant to Developer and its respective tenants, subtenants, concessionaires, licensees, employees, officers and invitees, non-exclusive temporarv easements over, upon, across and through those outdoor sidewa.lks, sr.airways, pedes tria.n bri dges, boat docking facilities, and other improvements constructed from time to time on the Authority Tract or the Proj ect Riverwalk Property or in the Air Rights which connect the Conference Center to the Riverwalk, such easements to be for the purpose of pedestrian passage to and. from the Riverwalk. Enjoyment of the easement granted herein shall commence on the date that such walkways, stairways and bridges are substantially completed and the Conference. Center is opened for business and shall continue so long as such improvemencs continue to exist or until December 31. 2025, whichever is sooner. G[OVER & DRVIS, P.R. TEL ~~o. 404 251 7152 Jun 06,89 9:59 P.14 . ., Section 12. 7 . Easement for Encroachments. While it is the incent of che Parties to confine their Improvements to the limits of c:he.ir respective Tracts, it is recognized thet this result may not be achieved due to the integrated nature of the Project. Accordingly. if the improvements on any Tract, following construction, encroach on a portion of the Tract of another Party, che Party across whose Tract such improvements encroach hereby grants to the Party whose improveme.nts so encroach an easement, for so long as such improvements (or any replacement thereof constructed during the term of this Agreemen t) stan d ~ permitting the construction and maintenance of such improvements on such portion of the grantor's cract. Section 12.8. Certain Reserved Rights. Developer hereby reserlles the rig ht to eject from its premises (including any "common" or "publ ic II areas thereof) any persons not invited or otherwise permitted to use same and to close off its respective Improvements at any time and from time to time for security purposes. Further, Conference Center Operator shall have the right to close off or 1 imit acces s to and from the Conference Center at any time and from time to time for security purposes, provided that the Conference Center Operator shall not be permitted to impede pedestrian access between the Parking Improvements or the Riverwalk Improvements, on the one hand, and the Hotel Improvements on the other hand, through the walkways, stairways and corridors of the Conference Center, except in connection with such temporary closings ""'__.... .,r. (3U~L\)EF. 8, DR'.) IS, P. R . TEL t'~o. 404 251 7152 Jun 06,89 10:00 P.15 as may be necessary for the cleaning, repair and maintenance of such access and improvements. Section 12.9. Term. Unless specified otherwise provided in this Agreement, the easements provided in this Article 12 shall be perpetual and shall not terminate upon the expiration or earlier termination of this Agreement. ARTICL~ 13. DAMAGE AND DESTRUCTION. Section 13.1. Damage or Destruction of Hotel. ^ Developer agrees that in the event of the damage or destruction during the Initial Term of this Agreement of all or any part of the Hotel Improvements, Developer shall be obligated to promptly rebuild, replace and repair such damage or destroyed improvements to the same condition and use full1ess and same general appearance as existed immediately prior to such damage or destruction; provided, however, that in the event damage or destruction to the Hotel has resulted from an event which also caused damage or destruction to all or a substantial part of the Conference Center and/or the Office Building, Developer's obligation to rebuild pursuant hereto shall be contingent upon the res toration and repair of the Conference Center and Office Building. If insurance proceeds available are insufficient to fully restore the Hotel Improvemencs, the cost of such restoration in excess of available insurance proceeds shall be paid by Deve.loper. Any such restoration and reconstruction shall be completed as expeditiously as reasonable possible and in compliance with the requirements herein set forth with respect to the initial construction of such Improvements. Pa~e 37 .~ GLOVER 8 DRVIS, P.R. TEL I'~o. 404 251 7152 Jun 06,89 14:19 P.17 " ; I I Section 13.2. Damage or Destruction of Conference Center. Provided that the Hotel Improvements are being operated as a Hote.l) in the event of damage to or destruction of all or any part of the! Conference Center during the . Initial Term of this Agreement, the City shall be obligated to promptly utilize all available insuranc~ proceeds to rebuild, replace and repair such damaged or destroyed improvements to the same condition and usefulness and to the same general appe.arance as existed immediately prior to' such damage or destruction; provided) however) that in the event any damage or destruction to the Conference Center has resulted from any event which also caused damage or destruction to all or a substantial part of the HotelJthe City's obligation to rebuild pursuant hereto shall be contingent upon the decision of the Developer to rebuild, replace and repair the Hotel. If the insurance proceeds available are insufficient to fully restore the Conference Center, the cost. of such restoration in excess of available insurance proceeds shall be paid by the Deve loper. Such reconstruction shall be completed as e.xpeditiously as reasonably possible and shall be performed in compliance with the requirements set forth with respect to the initial construction of such Improvements. Section 13.3. Damage or Destruction of Office Improvements. Provided that (i) the Developer determines in good faith that it is economically prudent and physically practical to restore or replace any affected improvements and to continue to operate a class A office building on the Office Tract and (ii) such restoration work GLOVER & DRVIS, P.R. ~ TEL No. 404 251 7152 Jun 06,89 14:20 P.1S is permitted by the Mortgage encumbering the Office Improvements, Developer hereby agrees that in the event of the damage or destruction during the Initial Te.rm of this Agreement of all or any part of the Office Improvements, Developer shall be obligated to promptly rebuild, replace and repair such damaged or destroyed Improvements to the. same condition and usefulness and to the same general appearance as existed immediately prior to such damage or destruction. If insurance proceeds available are insufficient to fully restore the Office Improvements, the cost of such restoration in excess of available insurance proceeds shall be paid by Developer. Any such reconstruction or restoration shall be completed as expeditiously as reasonably possible. Any Buch construction shall also comply with the requirements set forth herein with respect to initial construction of such Improvements. Section 13.4. Damage or Destruction of Parking Improvements. In the event of damage or destruction of all or any part of the Parking Improvements during the Term of this Agreement, the ,City or its designee, the Authority (as applicable) shall be obligated to promptly utilize all available insurance proceeds to rebuild, replace 'and repair such damaged or destroyed improvements to the same condition and usefulness and to the same general appearance as existed immediately prior to such damage or destruction; provided, ho~ever, that the extent of the City's obligation to rebuild pursuant hereto shall be contingent upon the continued operation of the Office Building, Conference Center or the Hotel, it being agreed Page 39 GLOVER & DAVIS. P.R. TEL I'~O. 404 251 7152 Jun 06,89 14:20 P.l~ that the0~~~~ot be required to repair and restore the Parking Improvements except to the extent that parking facilities are required in connection with the use and operation of the remaining Project Improveme.nts. Any reconstruction or repair of the Parking Improvements shall be completed as expeditiously as reasonably possible and shall be performed in compliance with the requirements herein set forth with respect to the in it ia1 construction of such Improvements. Section 13.5. Clearing Debris from Razed Improvements. To the extent a Party is not expressly required hereunder to restore all or a portion of its Improvements destroyed or damaged by casual ty and does not elect to restore such damaged or destroyed Improvements, "' such Party shall promptly raze the portions thereof which are not restored or rehabilitated, bring any Party Wall to the standard of an exterior wall, clear away all debris and take all other action (including landscaping) required by good construction practice so that the area which had been occupied by the razed building or portions thereof will be compatible with the remainder of the . Proj ect; provided, however, this provision shall not prevent such Party from subsequently building on the Tract 80 landscaped. Section 13.6. Discontinuance of Use as Hotel; Termination of Article 10. To the extent that Developer is not expressly required pursuant to the provisions of Section 13.1 hereof to restore all or a portion of the improvements located upon the Hotel Tract which are damaged or destroyed by a casualty occurring during the Initial Term Page 40 GLOVER & DRVIS. P.R. ~. TEL t~o. 404 251 7152 Jun 06.89 14:21 P.20 of this Agreement and does not elect to restore such damaged or destroyed improvements, and, in connection therewith) discontinues operation of a hotel upon the Hotel Tract) Developer shall be released from is obligation under Section 7.1 to operate the Hotel Tract a8 a hotel for the remaining balance of the Initial Term hereof; provided that the City shall thereafter be entitled to terminate the provisions of Article 10 of this Agreement by delivery written notice of such election to Developer, whereupon the City shall become vested with full responsibility for the operation, management, maintenance and repair of the Conference Center and the discharge of all obligations previously allocated to Developer with respect thereto under Article 10 hereof or under any other provisions of this Agreement. ARTICLE 14. INSURANCE Section 14.1. Hazard Insurance. Developer shall, at all times, including periods of construction, cause all buildings and other improvements on itsAproperty to be insured against loss or damage by fire, windstorm, hail, tornado, flood, explosions, smoke damage and other risks a8 are from time to time included in the usual form of "extended coverage" endorsement in Augusta, Georgia) in an amount not less than ninety percent (90~) of the. full replacement cost of such buildings and improvements (excluding foundation and excavation costs and cost of underground flues, pipes, and. drains and other insurable items) and in any event in at least such an amount as shall prevent such Party from becoming a co-insurer under the terms Page 41 GLDvtR & DRVIS, P.R. TEL I.~o. 404 251 7152 Jun 06,89 14:22 P.21 of applicable policies. The policy or policies effecting such insurance shall provide for wa:tver 0 f subrogat ion, if obtainab le, against the other Parties, and shall name any Mortgagee as an addit :tonal insured as its interes ts may appear. I f such waiver of subrogation is obtainable only at additional cost, the Party insured by the Policy to which same is applicable shall not be required to furnish such waiver unless the additional cost shall be paid by the Party having the benefit of such waiver. Such policies may provide for a deductible amount of not more than $50,000.00. City shall, at all times cause all buildings and other improvements on its property to be covered by the City's all-lines aggregate insurance program, which shall include property, casualty and general liability insurance coverage.. Section 14.2. Waiver and Release. Each Party hereto hereby mutually waives, for itself and its insurance carrier, upon approval of its insurance. carrier, any and every claim which arises, or may arise, in its favor against any other Party hereto during the term of this Agreement for any and all loss of, or damage to, any of its property located within or upon, or constituting a part of, the Proj ect, which loss or damage is covered or would be covered by valid and collectible fire and extended coverage insurance policies actually carried by such Party or required to be carried hereunder. Section 14.3. Liability Insurance. Developer shall, after the date hereof, at its expense, maintain general public liability insurance protecting itself, its contractors, subcontractors, i , GCOVE~ & DRVIS, P.R. TEL I'~o. 404 251 7152 Jun 06,89 10:04 P.21 "\'. agents, employees and the other Parties hereto from liability due to bodi 1y inj ury or dea th or property damage occurring in, on or about its respective property, such insurance to afford procection to the limit of not less than (i) $10,000,000 with respect to bodily injury to or death of anyone person, (ii) $10,000,000 with respect to total liability arising out of anyone incident or occurrence and (iii) $1,000,000 per occurrence with respect to any instance of '., ~"..- "property damage. The insurance coverage required to be maintained by Dev~ loper under this Section 14.3 shall name the other PartS-as additional insureQ..., and shall to the extent possible. provide for waiver of subrogation against the other PartY., if obtainable from the insurer and, provided that any extra premium for such coverage will be paid by the Party having the benefit of such wavier; the pol icies e.ffecting such coverage shall name any Mortgagee as an additional insured as its interests may appear. All limits of coverage required under this Sec tion 14.3 aha 11 be adj usted on the fifch (5th) anniversary of the date hereof and every five (5) years therea fter throughout the Term in proport ion to the change in the Consumer Price Index between the date of this Agreement and the date of the current adjustment as measured by the Consume.r Price Index published closest and prior to each adjustment date. Section 14.4. Insurance Carriers. All insurance provided for in this Article shall be effected under valid and enforceable policies issued by insurers of recognized responsibility and qualified to conduct business in the State of Georgia. Evidence of I .., (I II ~.' ~:::. ;:: [I H'. I.,...' I '::,.. F... H', . .J "'-; .... .. ..... I '. ..~ _ TEL No. 404 251 7152 Jun 06.89 10:04 P.22 the initial policies required to be carried by each Party hereunder shall be supplied and available prior to initiation of construction on such Party's tract. Thereafter, each Party shall, on the requesc of another party hereto, promptly furnish the reques ting Party a certificate evidencing the former Party's compliance with the insurance coverage requirements of this Article 14. Each such certificate of insurance shall stipulate therein that the insurance evidenced thereto shall not be materially reduced, cance lled or not renewed unless thirty (30) days' prior written notice shall have been given by the insurer to all other Parties hereto. Unless notified of cancellation of a policy, no Parcy shall be required during any given 360 day period to honor more than one such reques t .. from another Party hereto. Any Party may carry any insurance required to be maintained in this Article 14 under a "blanket policy" covering other properties of such Party and other insureds. ARTICLE 15. DEFAULT; REMEDIES. In the event any Party breaches any of Section 15.1. General. its obligations under this Agreement, the non-defaulting Parties shall have all rights available to them at law or in equity, including, without limitation, the right to enjoin violations of the obligations of the defaulting Party under this Agreement or to seek specific performance of such obligations, or to enforce any other rights which the non-defaulting Par~ay have pursuant to the-terms of this Agreement. .. . TEL No. il 404 251 7152 Jun 06,89 10:05 I ;:.,....,7 I . L -..) !;L[I',i:.F :~~ LIH") IS. F'. H . , . I Section 15.2. Hotel Developer' 8 Default. In the event that, following the opening of the Hotel for business, Developer ceases to operac:e a hotel on the Hotel Tract during the Initial Term hereof, and in the event such failure continues for a period of thirty (30) days after the City shall have served notice of such failure upon Developer, then and in such event the City shall have the right, exercisable by written notice delivered to Developer, to cancel Developer's right to operate and manage the Conference Center and to terminate the terms and provisions of Article 10 relating to such arrangement, whereupon the City shall become vested with full responsibility for the operation, management, maintenance and repair of the Conference Center and the discharge of all obligations with respect thereto previously allocated to Developer under Article 10 hereof and under any other provisions of this Agreement. In addition, th.e City shall have the right to pursue whatever other rights it may have at law or in equity. For purposes hereof, Developer shall be deemed to be operating the Hotel as a hotel during any period of renovation or, following any casualty, the period pending settlemenc with the insura.nce carrier and during any period in which Developer is diligently pursuing. reconstruction or restoration of the Rotel, or any temporary interruption in the operation of the Hocel after it opens for bus iness due co strikes, acts of God, national emergency or civil disorder, or other act of force maj eure, even though the Hotel may not be open for bus ines s with the public during such periods. bLUV~~ ~ UHvl~, ~.H. TEL I'~o, 404 251 7152 Jun 06,89 10:06 P,24 . " < " i I 'ASSIGNMENT TRANSFER AND MORTGAGE. , ARTICLE 16. Section 16.1. Transfer of Tracts. If during the Term any Tract is sold or otherwise transferred, such transfer shall be subject to this Agreement and the transfe.ree shall be bound by its transferor's obligations hereunder as fully as if such transferee were originally a party hereto. If any Party aha 11 trans fer or convey its entire Tract, such Party shall..Wl.t.. be released from..!ll!.Y. further liabili~y arising under this Agreement in respect of any period after the date of such transfer or conveyance without the written consent of the .other party. Section 16.2. Financing - Limitation of Mortgagee Liability. Notwithstanding anything to the contrary contained in this Agreement, any Party may finance i~s property or sell and lease back or lease and sublease back its property subject to this Agreement> and, in conjunction therewith, may convey and/or assign (either absolutely or conditionally) all of its rights and interests under this Agreement to any such mortgagee or Lessor. This Agreement and the rights, interests and easements created hereunder shall be prior and superior to any such Mortgage or lease of any portion of the Project Site. Any such Mortgagee or lessor shall be liable for the performance of the mortgagor's or lessee's covenants and obligations hereunder only if and for so long as such Mortgagee or lessor comes into and holds possession (or has a right to possession) of such mortgagor's or Les see I s property) but upon any such trans fer or further lease the transferree or sublease shall be subject to ~he Page 46 I~ L (I '.,:E F~ :? Ii H '.,.' 1 ':" F. H . TEL r'~o. 404 251 7152 Jun 06.89 10:06 P ~~ terms of this Agreement. Exceot as sDecificall y provided in this Agreement, no Mortgagee shall have any personal or corporate liabilicy with regard to any provision of this Agreement during che period of such Mortgagee I s ownership or possession of any property encumbered hereby, any such Mortgagee's liability hereunder being limited to its interest in any Tract, any improvements erected thereon, and the rents and other income derived therefrom. Sect ion 16.3. Ass ignment to Authori~. . Regard less of anything ~ontained herein to the contrary, the City shall have the right to .ct;,raC!Efer.1. lease. convey and/or assign to the Authority any and all ~ights. duties and obli~ations which the City may have with respect -.t:o the constrllcr:ion, nperAr:ion And maintep~nce of the Parking and lease conve ance and/or assignment and the acceptance of the same by the Authoritv. the City hall be released from an and all res onsibilit therefor under the terms of this ARreement. ARTICLE 17. TERM. Unless sooner terminated pursuant to the provisions hereof, this Agreement and t.he rights and obligations of the Parties hereunder shall continue and shall remain binding upon the Parties from the date hereof until December 31, 2025 (the If Initial Term"). Thereafter, this Agreement shall automatically be continued to the extent and for the maximum time permitted by Georgia law for successive periods of one (1) year each for BO long as the Hotel Improvements shall continue to be operated as a hotel unless all ';LQi'E~.,8 IIH',/I.:,. F'.H. TEL 140. i 4(142517152 Jun CJb.2:9 1CJ:07 F..2t, . .- . . I.... . . .. I ; Parties shall agree in ~riting to terminate this Agreement. Additionally, (i) upon the request of any Party ~hich secures or has secured financing for construction of its portion of the Project, which financing extends beyond the then date of termination of the then current Term hereof, such Term shall automatically be extended up to and including the final maturity date of such financing, and (ii) upon the request of Developer, if Developer enters into or has entered into any franchise agreement with respect to the Hotel the I:erm of wnich franchise agreement extends beyond the then date of termination of the then current Term hereof, such Term shall automatically be extended up to and including the date of termination of the term of such franchise agreement. All reques ts effecting automatic extensions as provided in the preceding sentence shall be given by notice in writing to all Parties hereto in accordance with the provisions of Section 18.1 below. ARTICLE 18. NOTICES. Section 18.1. Any notice, request, demand, approval or consent given or required to be given under this Agreement shall be in writing and shall be deemed to have been given or made or communicated when delivered by hand, when received (as evidenced by the official return receipt of the U. S. Postal Service) if mailed by certified or registered United States mail, postage pre-paid, 'P ~H70 L1. R I:,LCf,,/EF: '::: DA',.)I'~;, F'.A. TEL I',jo. ~ 404 251 7152 Jun 06,89 10:08 F' .',/ . ~ I , ,> . , return receipt requested, or when delivered if sent by Federal Express or other recognized overnight courier delivery service, addressed as follows: In case of the City to: The Honorable Charles A. DeVaney Mayor, City of Augusta Ci~y County Municipal Bldg. Augusta, Georgia 30911 In the case of the Developer to: Augusta Riverfront Limited Partnership c/o Morris Communications, Inc. With a copy to: Bailey & Associates 6190 Powers Ferry Road Suite 100 Atlanta, Georgia 30339 Attention: Mr. William F. Bailey, Jr. Any Party may, at any time, change its address for the above purposes by giving notices to the other Parties in the manner herein provided, such designation being effective from and after the day of receipt of notice thereof by the other Parties. Section 18.2. Notice of Mortgagees. Each Party giving notice of a default under this Agreement shall send by registered or certified United Scates mail, postage pre-paid, a copy of such notice to any holder of a Mortgage on the property or improvements of the Part:y so notified provided that such holder shall have sent the Party giving the notice of default a notice informing it of the existence of such Mortgage and the name. of the person or officer and 'D~ -D '10 GLDYE~ & D8VIS, P.8. TEL No. 404 251 7152 Jun 06,89 10:08 F'~'Q . .:.,.....' .. , " the address to which copies of such notices of default are to be sent, and such holder shall be permitted to cure any such default no lacer chao sixty (60) days after a copy 0 f the not ice 0 f defaul t shall have been sent to such holder, provided that in the case of a defaul t which cannot with diligence be remedied within such period of sixty (60) days, such Holder shall have such additional period as may be necessary to remedy such default with diligence and continuity. ARTICLE 19. MISCELLAN~US. Section 19.1. Amendmen~s and Modifications. This Agreement may be amended or modified only by written instrument signed by each of the Parties hereto affected by such amendment or modification. Any such amendment or modification shall be made and executed in recordable form. A copy of each such modification or amendment sha 11 be provided to each Party hereto t even if a Party is not: a signatory to such modification or amendment. Section 19.2. References to Articles, Sections and Subsections. All references herein to a given Article) Section, subsection or subparagraph refer to the Article, Section subsection or subp~ragraph of this Amendment. Section 19.3. T able of Contents and Capt ions. The table. of contents and captions of this Agreement are inserted only as a matter of convenience and for reference. They do not define, limit or describe the scope of intent of this Agreement and they shall not affect the interpretation hereof. '0",..."" c;n . '-' . 404 251 ;152 ]un 06.89 10:09 P.29 . SeCtion 19.4. Locative Adverbs. The adve rbs "herein" , "herein", "hereto" J "hereby" J "hereinafter", and like words wherever the same appear herein, mean and refer to this Agreement in its entirety and not to any specific Article, Section or subsection h~reofJ unless o~herwise specifically indicaced. Section 19.5. Waiver of Default. A waiver of any default by a Party mUSt be in writing, and no such waiver shall be implied from any delay or omission by a Party to take any action in respect of such default. No express written waiver of any default shall affect period of time specified in such express waiver. any default or cover any period of time other than the default and written waivers of any default in the performance of any provisions of this Agreement shall not be deemed to be a waiver of any One or more subsequent default in the performance of the same provisions or any ocher term or provision contained herein. The consent: or approval by a Party to or any act or request by another Party requiring consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act or requests. Section 19.6. A reement for Exclusive Benefit of Parties. The provisions of this Agreement are for the exclusive benefit of the Part ie s , the ir SUcce s Sor s and as signs, including their Mortgagees. and are not for the benefit of any person not a Party. Page 51 I~L [I'...'E~. (; [lH') I':., F. H . ,~ .. '. ., ,. . .' . . TEL. I'~ 0 . 404 ~51 7152 Jun 06,8~ 10:09 P.30 , . I , Section 19.7. No Pa.rtnership, Joint Venture or Principa.l-Agent Relationship. Neither anything in this Agreement nor any acts of the Parties shall be deemed by the Parties or by any third person, to create the relationship of principal and agent, or partnership, of joint venture or of any association between the Parties. Section 19.8. Estoppel Certificates. Any Party shall, from time to time, upon not less than thirty (30) days' notice from any other Party, execur:.e and deliver to such other Party a certificate in recordable form stating, if such be the case, that this Agreement is unmodified and to the best of its knowledge in full force and effect or t if modified, that this Agreement is in full force a.nd effecr:., as modified, and stating the modification and stating whether or not, to the best of its knowledge, the Party requesting such certificate is in default in any respect under this Agreement, and if in default, specifying such default. Section 19.9. Successors and Assigns. All the terms of this Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the Parties. Section 19.10. Governing Law. This Agreement shall be construed and governed in accordance with the laws of the State of Georgia. Section 19.11 Covenants Run with the Land. To the fullest extent legally possible, the covenants, agreements, restrictions and easements described in this Agreement shall run with and be enforceable against boch the covenantor and che land and constitute Page 52 GLOVEF & DRVIS, P.R. .-" . . . ~ ..., 't : 't' " " TEL I'~o. 404 251 7152 Jun 06,89 10:10 P,31 equitable servitudes as between the property of the respective covenantor, as the servient tenement, and the property of the respective covenantee, as the dominant tenement. Unless the content indicates otherwise, every covenant, easement, agreement and promise of each Parcy as set forth in this Agreement shall be deemed a covenant, easement, agreement and promise made for the joint and several benefit of the other Parties t and every duty of each Party as set forth in this agreement shall be deemed to run for the joint and several benefit of the other Parties. Section 19.12. Dedication. Nothing herein contained shall be deemed a gift or dedication of any part of the Hotel Tract or the Office Tract or the Parking Tract to the general public, or for the general public, or for any public purpose whatsoever, it being the intention of the Parties that this Agreement shall be strictly limited to and for the purposes herein expressed. Section 19.13. Counterparts. This Agreement shall be signed in several couuterparts, each of which shall be deemed an original, and all such counterparts shall constitute one and the same instrument. Section 19.14. Partial Invalidity. If any provision of this Agreement or the application thereof to any Party or circumsta.nces shall to any extent be invalid or unenforceable, such provision and all remaining provisions of chis Agreement nevertheless shall be valid and enforceable to the fullest extent permitted by law. Section 19.15. Recordin~ of Agreement. The Parties agree that this Agreement shall be recorded in the real estate records of Richmond County, Georgia. Page 53 ~ . :'L 1_, ." [.." .. [iAI,) 1~" ~. H . .;~.. '. .,t A t ~ I ..... "'..". " , TEL t'~o. 404 251 7152 Jun 06.89 10:11 P.32 Section 19.16. Business Days. Whenever a date expressed in this Agreement shall OCcur on a Saturday) Sunday or state or federal holiday, such date shall be extended to the next business day following such date. Sect:ion 19.17. Merger of Prior Agreements. This Agreements supersedes all prior agreements and understandings between the Parties hereto relating to the subject matter hereof. and no between the Parties not embodied herein or in documents of even date representations, inducements. promises or agreements, or otherwise, herewith or entered into subsequent to the date hereof shall be of any force or effect. Agreement the day and year first above written. IN WITNESS WHEREOF) the Parties hereto have executed this CITY; CITY OF AUGUSTA, GEORGIA By; Charles A DeVaney, Mayor DEVELOPER: AUGUSTA RIVERFRONT PARTNERSHIP LIMITED BY; Azalea Development Corporation. General Partner By; Its: By: B&A Augus'ta Limited Partnership. General Partner By: Bailey Augusta. Inc.) general partner By: 1ts: President 0171s Page 54 .. .. ~X.ttI5-LT :] ~ (P/7/f'9 -,+, STATE OF GEORGIA COUNTY OF RICHMOND UDAG CITY/DEVELOPER AGREEMENT THIS AGREEMENT made and entered into this the ____ day of , 1989, by and between the CITY COUNCIL OF AUGUSTA, GEORGIA, a municipal corporation under the laws of the State of Georgia, (the "City"), and AUGUSTA RIVERFRONT LIMITED PARTNERSHIP, (the "Developer"); WIT N E SSE T H: WHEREAS, City has entered into an agreement with the United states Department of Housing and Urban Development, ("HUD"), which agreement awards to City an Urban Development Action Grant (UDAG No. B-87-AA-13-0095), (the "UDAG"), ,in the total amount of SEVEN MILLION, FIVE HUNDRED SIXTY-TWO THOUSAND, FOUR HUNDRED FIFTY-FOUR DOLLARS ($7,562,454.00); and WHEREAS, Developer will borrow from City an amount equal to the total amount of the UDAG (the "UDAG Loan") received by City, and will use the proceeds thereof as partial construction/permanent financing for development of a proj ect known as "The Augusta Riverfront Project", and will construct improvements upon land located in the City of Augusta, State of Georgia, located in downtown Augusta between Reynolds Street and the Savannah River, bordered to the east by Ninth Street, and to the west by Tenth Street, all as more particularly described in Exhibit "A" of the UDAG Security Deed and Security Agreement (the .~ "UDAG Security Deed") of even date, (said property hereinafter referred to as the "Project Site"); a copy of said UDAG Security Deed and Security Agreement being attached hereto as Exhibit "A"; WHEREAS, the Developer will construct an office building containing approximately 128,000 square feet of office space (the "Office Building Component"); and a 225 room hotel (the "Hotel Component"); and the City will provide or cause to be provided a certain amount of funding to be used toward the construction of a 28,000 square foot conference center (the "Conference Center Component", parking facilities providing not less than 975 parking spaces (the "Parking Component"), and the extension of the Riverwalk to the western border of the Project site (i.e., Tenth Street), (the "Riverwalk Component"); said components collectively hereinafter are referred to as "Improvements"; the Project site and Improvements together hereinafter are referred to as the "Project Elements"; WHEREAS, Developer shall provide private financing in addition to the UDAG Loan, for development of the Office Building and Hotel Components, and City shall provide or cause to be provided financing for the Conference Center in an amount not to exceed $3,900,000, and shall provide financing for the Riverwalk Components, as well as certain street improvements, all as set forth below; WHEREAS, the parties hereto acknowledge that the UDAG Grant Agreement between City and HOD, among other things, requires City to enter into this written agreement with 2 ." Developer, setting forth the obligations of the participating parties with reference to the development and financing of the Project Elements, and requires Developer to execute other documents, which together set forth the terms and conditions under which the UDAG Loan will be disbursed to the Developer; WHEREAS, the parties acknowledge that City shall have no obligation to disburse any funds pursuant to this Agreement or perform any other duties hereunder, should UDAG funds not be disbursed by HUD to the City for any reason whatsoever. NOW, THEREFORE, for and in consideration of the mutual covenants and conditions herein contained, the parties do agree as follows: 1. The Developer shall: (a) complete the Developer's portion of the Project Elements on the Project Site, in accordance with the provisions of Exhibit "A" hereto, at a total cost of not less than $33,810,729 pursuant to Exhibit "D" of the UDAG Grant Agreement, using not less than $20,000,000 of private loan funds, not less than $6,248,275 of Developer's cash equity funds (including $525,000 of land value ascribed by HUD to a portion of the Project Site) and not more than $7,562,454 of UDAG Funds; (b) borrow from Lender not less than $20,000,000 for financing the Project; (c) invest not less than $6,248,275 of equity funds in the Project; 3 ~ (d) borrow from City not more than $7,562,454 of UDAG Funds for financing the Project, to be secured by UDAG Security Deed conveying all land, buildings, fixtures, equipment and other assets of Developer comprising the Project and not subordinated to any interest except the first mortgagees) in an original principal amount not to exceed $21,550,000, plus any further advances by the mortgagee (s) which are invested in the proj ect and are required for its completion; (e) unconditionally and irrevocably guarantee the completion of the Project in accordance with the schedule set forth in Exhibit "F" to the UDAG Agreement as the same may be hereafter amended; (f) provide City and/or HUD with any information requested by either City or HUD, which information shall, in the opinion of either City or HUD, be necessary to monitor or determine compliance by Developer with any of Developer's obligations herein contained, or relating to said UDAG Grant Agreement; (g) comply with all other obligations imposed upon Developer under the UDAG Agreement as amended. (h) lease to the City or the Downtown Development Authority for such term as the City or the Downtown Development Authority shall reasonably request at a rental of $1.00 per year those areas of the project designated for surface parking. This lease shall contain reservations in favor of the Developer to 4 .' substitute, from time to time, in whole or in part, other suitable parking areas or spaces and obtain releases of comparable spaces from the terms of said lease. 2. The city shall: (a) lend to Developer the sum of $7,562,464 in UDAG Grant Funds which shall be used as set forth in Exhibit "0" to the UDAG Agreement for construction of the Developer's portion of the Project Elements; and (b) use not less than $9,906,000 of city funds to finance the construction of the following: (i) a 28,000 square foot conference center to be constructed, furnished and equipped at a cost not to exceed $3,900,000 ; title to said conference center together with all furnishings, fixtures and improvements to be vested in City; (ii) surface parking areas and a 635 space parking deck both to be constructed and/or equipped at a cost not to exceed the sum of $3,816,000; title to said parking facility to be vested in city or at the option of the City, in the Downtown Development Authority and the land upon which is located the surface parking shall be leased to the City and/or said Authority for a rental of $1.00 per year; (iii) certain street improvements to Ninth street and Tenth street serving the proj ect at a cost not to exceed $1,300,000; 5 (iv) 990 feet of Riverwalk Improvements along property owned by City along the Savannah River between Eighth Street and Tenth Street; (c) comply with all requirements and obligations undertaken by city in the UDAG Grant Agreement. 3. The UDAG Loan. The UDAG Loan shall be made subject to the legal operation and effect of the UDAG Promissory Note of even date between the parties, and said UDAG Promissory Note is, by this reference, incorporated herein, and made a part hereof. (a) Interim UDAG Loan. (i) Term. Term of the Interim UDAG Loan shall commence upon the initial disbursement of Grant Funds, but in no event later than July 1, 1989, and shall end upon the completion of construction, but in no event later than September 30, 1991. (ii) Principal. The principal amount of the Interim UDAG Loan shall be no more than $7,562,454.00. (iii) Interest. There shall be no interest. (iv) Disbursement/Ratio. Disbursements of UDAG Loan Funds shall be based on vouchers submitted by Developer, verified by City, and certified by the architect, construction manager, or other certifying official acceptable to City. All submissions by contractors of monthly requisitions shall be on AIA Forms 702 and 703 or their equivalent. No disbursement of the UDAG Loan shall be made until: 6 (a) Developer has furnished City with an ALTA Loan Policy of title insurance in the original principal amount of the UDAG Loan, insuring that city is the holder of a lien on the Project Site, free of encumbrances and other exceptions to title other than those approved in advance by City, and not subordinated to any interest except that the Developer may obtain construction and/or first mortgage financing of up to $21,550,000.00. (b) Developer has furnished City with a Builder's Risk and Fire Insurance policy or policies duly endorsed to indicate City as an insured secured party. (c) All of the requirements for draw down of Grant Funds set forth in Paragraph I (b) of Exhibit "F" to the UDAG Grant Agreement have been satisfied. (d) Developer has expended not less of cash equity funds for Eligible Costs of $500,000.00 Project. than the After the above requirements have been satisfied, UDAG Loan funds may be drawn down and disbursed for use in accordance with Exhibit "D" to the UDAG Grant Agreement in a ratio to countable private funds of not more than $1.00 of UDAG Loan Funds to $3.25 of countable private funds expended on the Project, including the funds above required to be expended prior to disbursement of UDAG Loan Funds. "Countable private" funds means- the funds described on line "r" of Exhibit "D" to the UDAG Grant Agreement. 7 (b) Permanent UDAG Loan. (i) Term. Term of the Permanent UDAG Loan shall be thirty (30) years commencing upon completion of construction, but in no event later than september 30, 1991. (ii) Principal. The principal amount of the Permanent UDAG Loan shall be the amount disbursed under the Interim UDAG Loan. (iii) Interest. The interest rate shall be 0% per annum. (iv) Repayment. There shall be no requirement for payments of principal during the term of the Loan. There shall be a single payment of the Principal at the end of the Loan Term. (v) Contingent Interest/Participation in Cash Flow. Beginning in the fifth year of the Loan Term ?nd annually thereafter throughout the remainder of the Term of the Permanent UDAG Loan, Developer shall pay to City 20% of the Net Annual Cash Flow of the project. "Net Annual Cash Flow" means all operating income and receipts of the Project less (1) debt service on the first priority financing, if any, (2) real estate taxes, (3) reasonable operating expenses (including a management fee not to exceed 5% of operating income) allowable for Federal income tax purposes, but excluding reserves for capital improvements, depreciation and other non-cash items, and (4) a 15% non-cumulative return to Developer on Developer's documented cash equity funds invested in the Project, including the value ascribed by HUD to a portion of the Project site of $525,000.00 8 and certified cash equity invested for operating losses in years one (1) through four (4) of the operations. Participation payments shall be due within ninety (90) days of the end of each operating year of the Project. (c) Security. The UDAG Loan shall be secured by a securi ty deed in such form as is selected by city in favor of City upon all land, buildings, fixtures, equipment and other assets of the Developer comprising the Project, the "UDAG Security Deed", of even date herewith, and said UDAG Security Deed is, by this reference, incorporated herein, and made a part hereof. The security position of the City may be subordinated only to the First Mortgage(s) in an amount not to exceed $21,550,000, plus any further advances by the mortgagee(s) which are invested in the Project and are required for its completion. (d) Participation in Sale or Refinancing. Developer shall pay to City 20% of the Net Proceeds from any sale or disposition in whole or part of the Project or from any syndication or refinancing, except refinancing allowed pursuant to a call or takeout provision in the First Mortgage (s) . "Net Proceeds" shall be defined as all proceeds received less (1) repayment of the first priority financing (if applicable), (2) repayment of the UDAG Loan, (3) Developer's documented reasonable costs of sale or refinancing, and (4) repayment of documented Developer's cash equity funds invested in the Project including the value ascribed by HUD to a portion of the Project site of $525,000. 9 '- (e) Acceleration of UDAG Loan. The entire principal balance of the UDAG Loan shall become immediately due and payable upon the (1) bankruptcy or reorganization of the Developer under the Bankruptcy Code, (2) dissolution or liquidation of the Developer, (3) syndication of the Developer (except a one-time syndication of the Developer, pursuant to subsection (g)), (4) change in ownership of the general partnership interest or transfer of 50% or more of the corporate stock or controlling interest in the Developer, or (5) refinance, sale, partial sale, exchange, transfer, sale under foreclosure, or any other disposition of the Project Site, improvements or capital equipment situated thereon. No improvements or capital equipment situated on the Project site shall be removed, demolished, or materially altered, without prior written consent of City, except that Developer shall have the right, without such consent, to remove and dispose of, free from any lien of City, such equipment as from time to time may become worn out or obsolete, provided that simultaneously with or prior to such removal any such equipment shall be replaced with other equipment of value at least equal to that of the replaced equipment and free from any title retention or other encumbrance unless permitted in paragraph (c) above, and by such removal and replacement Developer shall be deemed to have subjected such equipment to the lien of City. 10 (f) Guarantee. Developer shall unconditionally and irrevocably guarantee the completion of the Developer's portion of the Project, and shall unconditionally and irrevocably guarantee the repayment of the UDAG Loan until the date of construction completion. (g) Excess Syndication Proceeds. city shall be entitled to receive sixty percent (60%) of the Excess Syndication Proceeds from the Proj ect. "Excess Syndication Proceeds" means the amount of net syndication proceeds either owed to or received by the general partner (s) from the limited partner investor (s) that results in a surplus of receipts not required to complete the Project and is in excess of $6,248,275.00 of cash equity committed to be invested in the Project (plus any additional equity funds required to complete the Project) and a recognized equity contribution of the Project site of $525,000.00 (including $525,000 of land value ascribed by HUD to a portion of the Project Site). "Net syndication proceeds" means all syndication proceeds received. less arm's length, third. party costs of the syndication such as legal, accounting, closing, printing, syndication, brokerage and marketing fees. (h) Annual Accounting. Developer shall deliver a statement to City from an independent certified Public/Accountant within ninety (90) days of the close of each operating year during the Term of the Permanent UDAG Loan, certifying: 11 (1) Operating income and receipts of the Project; (2) Operating expenses allowable for Federal Income Tax purposes; (3) Net Annual Cash Flow; (4) Developer equity invested in the Project; (5) Net Proceeds; (6) Gross syndication proceeds, if applicable; (7) Net Syndication Proceeds, and a statement of allowable deductions used to determine said amount, in accordance with subsection (g) above, if applicable; (8) Excess syndication Proceeds; and (9) The amount of participation in Net Annual Cash Flow, Net Proceeds, and Excess syndication Proceeds due city. 4. Assurance of Governmental Approvals. City and Developer both mutually hereby warrant that each has obtained or has reasonable assurance that it will obtain all federal, state, and local governmental approvals and reviews required by law to be obtained by either City or Developer for the Project. 5. Completion of Project. Developer hereby acknowledges that HUD in selecting City for award of said UDAG has relied in material part upon the assured completion of the Project, and Developer hereby assures City that such activities will be completed by Developer within the time frame herein set 12 forth. The Project Elements shall be constructed in accordance with the UDAG Grant Agreement, Exhibit "F", which provides for -J the following schedule: Activity Commencement Date Completion Date Private Construction January 13, 1989 September 30, 1991 Public Construction September 30, 1989 September 30, 1991 Notwithstanding any provision to the contrary in this Agreement, Developer's construction of the Project Elements must be carried forward expeditiously wihout interruption and with adequate forces to achieve completion by the completion date. 6. Creation of Jobs. Developer agrees to use its best efforts to create or cause to be created within seventy-two (72) months from preliminary approval of the application for UDAG Funds for this Project (September 30, 1987), the jobs referenced in Exhibit "A" of the UDAG Grant Agreement. Developer agrees to report to City, as HUD may from time to time require, the number and kinds of such jobs created or caused to be created and filled. 7. Maintaining Records and Right to Inspect. Developer hereby agrees to keep and maintain books, records, and other documents relating directly to the receipt and disbursement of UDAG Funds and hereby agrees that any duly authorized representative of City or of HUD or Comptroller General of the United States shall, at all reasonable times, have access to and the right to inspect, copy, audit, and examine all such books, 13 records, and other documents of Developer until the completion of all close-out procedures respecting this Loan and the final settlement and conclusion of all matters arising out of the UDAG Loan herein referenced. Developer hereby agrees that any duly authorized represenative of the Secretary of HUD shall, at all reasonable times, have access to any portion of the Project in which Developer is involved, until the completion of all close-out procedures respecting this Grant. 8. Notices. All required notices, requests, and demands upon the respective parties hereto shall be in writing and shall be sent by hand delivery, express mail, or messenger, or registered or certified mail with return receipt requested, to the following addresses, or to such other addresses as may be designated by written notice, duly mailed: (a) To City: Mayor, City of Augusta City-County Municipal Building 530 Greene Street Augusta, Georgia 30911 Copy To: Director, Office of Economic Developments City of Augusta City-County Municipal Building Augusta, Georgia 30911 (b) To Developer: Augusta Riverfront Limited Partnership c/o Azalea Development Corporation Post Office Box 936 Augusta, Georgia 30913 14 Copy To: B & A Augusta Limited Partnership 6190 Powers Ferry Road, NE suite 100 Atlanta, Georgia 30339 9. Assignment or Succession Developer agrees that no transfer of UDAG Funds by City to Developer shall be, or be deemed to be, an assignment of UDAG Funds, and Developer shall neither succeed to any rights, benefits, or advantages of city under its UDAG Grant Agreement with HUD nor attain any rights, privileges, authorities, or interests in or under the aforesaid UDAG Grant Agreement. 10. Approval of Amendments. During the term of the Loan provided for herein, and until Project close-out by HUD, this contract shall not be amended in any material respect after its approval and acceptance by HUD without the prior written approval of HUD. The term "material", as used herein, shall mean anything which cancels, or reduces by more than ten percent (10%), any developmental, construction, job-creating, or financial obligation of Developer changes the site or character of any development activity, or increases any time for performance by a party by more than thirty (30) days. 11. Disclaimer of Relationships. The parties hereto acknowledge that nothing contained in the UDAG Grant Agreement between City and HUD or in this contract between City and Developer, nor any act of HUD, City, or any of the parties to any of the aforesaid agreements, shall be deemed or construed by any 15 '~ '\ of the parties, or by any third persons, to create any relationship of third-party beneficiary, principal and agent, limited or general partnership, or joint venture, or of any association or relationship involving HUD. 12 . Limitation of Liabili ty. All parties hereto acknowledge that city shall not be liable to Developer or to any other party except HUD for completion of, or the failure to complete any activities which are part of the Project with the exception of the Loan required to be made by City to Developer and all other obligations set forth in paragraph numbered 2 hereof. 13. Conflict of Interest. The parties hereby agree that except for approved eligible administrative and personnel costs, no member, officer, or employee of City or its designees or agents, no consultant, no member of the governing body of city, and no other public official of city who exericses or has exercised any functions or responsibilities with respect to the Project during his tenure, or who is in a position to participate in a decision-making process or gain inside information with regard to the Project, shall have any interest, direct or indirect, in any contract or subcontract or the proceeds thereof, for the work to be performed in connection with the Project or in any activity or benefit therefrom which is part of the Project at any time during or after his tenure. 16 " ,- 14. proj ect Signs. Developer agrees to erect on the Site of the Project one or more signs indicating that the Project is assisted in part by HUD Urban Development Action Grant Funds. Any such signs shall be approved by City prior to erection and shall be consistent with criteria now or hereafter established by HUD. 15. Execution in Counterparts. This Agreement may be executed in any number of counterparts. All such counterparts shall be deemed to be originals and together shall constitute but one and the same instrument. 16. Governing Law. This Agreement as it may affect the rights, remedies, duties, and obligations of the Secretary of HUD shall be governed and construed by federal law. Insofar as federal law does not apply, the provisions of this Agreement shall be governed and construed by the laws of the State of Georgia. 17. Entire Agreement. This Agreement, including the provisions of the UDAG Promissory Note and UDAG Security Deed, which have been incorporated by reference herein, constitutes the entire agreement between the parties hereto; provided, however, that in the event that the UDAG Grant Agreement calls for any additional duties or obligations to be imposed upon or performed by Developer in addition to those specified herein, Developer agrees to fully comply with the same, it being agreed that in the 17 event of any conflict between the terms of this Agreement and the terms of the UDAG Grant Agreement, as the same may be amended, the terms of the UDAG Grant Agreement shall control. 18. Indemnification. Developer hereby agrees to indemnify and hold forever harmless City from any and all loss, damage, and liability, including reasonable attorney's fees it may incur or sustain as a result of Developer's failure to perform its obligations hereunder. 19. Time of Essence. Time is of the essence of this Agreement. 20. Definitions. Capitalized terms are defined in Schedule "BI', attached hereto and made a part hereof. IN WITNESS WHEREOF, the parties hereto have caused the execution of these presents by the duly authorized officers and the corporate seal affixed on the date first above written. AUGUSTA RIVERFRONT LIMITED PARTNERSHIP, Developer BY: B&A AUGUSTA LIMITED PARTNERSHIP, Managing Partner BY: Bailey Augusta, Inc. Its General Partner BY: AS ITS ATTEST: AS ITS 18 . '...t ..\ . , ....~ II [X+lleIT C i CONSTRUCTION MANAGEMENT AGREEMENT STATE OF GEORGIA COUNTY OF RICHMOND THIS AGREEMENT, made and entered into as of this day of , 1989, between the CITY COUNCIL OF AUGUSTA, GEORGIA, a Georgia municipal corporation (the "Owner") , and BAILEY & ASSOCIATES, a Georgia general partnership consisting of Bailey Realty, Inc. and Batson-Cook Development Company (the "Manager"), as partners, WIT N E SSE T H: WHEREAS, Owner is the present owner and/ or lessee of certain real property situate, lying and being in the City of Augusta, Georgia, more particularly described on "Exhibit A" attached hereto, incorporated herein and made a part hereof by reference (the "Property"); and WHEREAS, Owner is desirous of constructing on the Property in conjunction with the construction of a hotel and office building on adjacent property by Augusta Riverfront Limited Partnership, but not otherwise, a convention center (the "Convention Center") and related parking deck and facilities (the "Parking Facilities") (the Convention Center and the Parking Facilities collectively the "Improvements") and wishes to engage '. .t~ ( l' the services of Manager to provide coordination expertise for the development and construction of the Improvements on the Property; and WHEREAS, Owner and Manager. wish to enter into this Agreement to set forth the terms and conditions to which they have agreed; NOW THEREFORE, in consideration of the mutual covenants and benefits flowing to and from each of the parties hereto, it is hereby agreed as follows: 1. The following definitions shall be applicable to the terms and conditions hereof: ( a) Accountants: The firm of certified public accountants selected by Owner for the Project. (b) Architects: The architectural firm of Smallwood, Reynolds, Stewart, Stewart & Associates, Inc., Parking and Planning Consultants,' Inc. and/or such other architectural firm(s) as may be selected by Owner to provide architectural services for the Project. (c) Attorneys" The law firm(s) selected by the Owner to provide legal services for the Project. (d) Improvements: The Convention Center and the Parking Facilities. (e) Construction Contracts: A lump sum contracts for construction of the Convention Center and the Parking Facilities to be entered into between the General Contractor and the Owner or its assignee. 2 ~ ~: 1~ (f) Consulting Engineers: Those engineers and engineering firms selected and employed by the Architects to perform engineering services for the Project. (g) Manager: Bailey & Associates, a Georgia general partnership composed of Bailey Realty, Inc. and Batson-Cook Development Company as partners. (h) General Contractor: The general contractor chosen by the Owner to construct the Improvements; the General Contractor shall be judged by the Owner to be the lowest and best bidder from / a prequalified list of construction companies. (i) Convention Center: The convention facility to be designed by the Architects for construction by the General Contractor on the Property; the Convention Center is anticipated to contain approximately 28,000 square feet of space. (j)Parking Facilities: The parking deck and on-site parking facilities to be designed by the Architects for / construction by the General Contractor on the Property; the Parking Facilities are anticipated to contain approximately 775 parking spaces. (k) Owner: The City Council of Augusta, Georgia, a Georgia municipal corporation. (1) Project: The development and construction of the Improvements on the Property in accordance with the provisions of the respective Project Budgets. (m) Project Budgets: A budget in the amount of $3,900,000.00 for the development, design, and construction of the 3 fixtures and equipment reasonably required for the operation of , , '. .. Conference Center and the payment of the cost of all furnishings, such Conference Center facility, ("Conference Center Project Budget") and a budget in the amount of $3,816,000.00 for the development, design, construction, and equipping of the Parking Deck and on-site parking facilities, including all fixtures and equipment to be utilized therein ("Parking Facility Project Budget"); a copy of the Convention Center Project Budget and a copy of the Parking Facilities Project Budget will be developed by Manager for approval by Owner and once approved, a copy of same (with the approval of Manager and Owner noted thereon) shall be attached hereto as "Exhibit B". (n) Project Cost: The actual cost of all those items delineated on the Project Budget for each project. (0) Project Savings: The savings, if any, between the estimated cost of the items set forth on each Project Budget and the actual cost thereof (as determined upon completion of same). (p) Property: All that certain tract or parcel of land situate, lying and being in the City of Augusta, Georgia, and more particularly described on "Exhibit A" attached hereto, incorporated herein and made a part hereof by reference. 2. Owner, upon the terms hereinafter stated, hereby engages the services of Manager for development and construction coordination for the Improvements, as of the effective date hereof. 4 .. .; ,: 3. Manager, as an independent contractor, will provide the following construction management services to Owner with regard to the Improvements and the Property: (a) Manager will provide coordination services among the Architects, the General Contractor(s), Consulting Engineers, Accountants, Attorneys and applicable governmental departments during the development and construction phases of the Improvements. In this regard, Manager will endeavor to insure proper performance by each of said persons or entities in order to complete the Improvements in accordance with construction plans and specifications approved by Owner therefor. (b) Attached hereto as "Exhibit C" are preliminary plans, specifications and descriptions which define the scope of the Project (the "Project Scope") including the number and quality of the "first class" furnishing, fixtures and equipment which the parties deem appropriate to be installed in or placed in the Improvements. Without changing the Project Scope (unless authorized in writing by Owner), Manager will coordinate the design services to be rendered by the Architects to cause final plans and specifications in biddable form to coordinate the design of the buildings to be produced for public bidding by prequalified general contractors. The Manager shall also coordinate the plans and specifications for the bidding of the furnishings, fixtures, and equipment to be installed in the Improvements. The Parking Facilities Project and the Convention Center Project shall be bid separately. 5 ~ . : (c) Manager will insure that all required surveying and engineering services are provided for the Improvements and the Property, and will provide all coordination and administration services relative thereto. (d) Manager will prepare for approval by Owner proposed contracts with the Architects, the General Contractor (s), and all other appropriate entities, and will coordinate all construction phases for the Improvements and the Property. Manager will also process and forward to Owner all progress payment requests from the General Contractor(s) (with supporting documentation therefor as reasonably requested by Owner, i.e., approved vouchers), prescribe appropriate forms of documentation for such progress payment requests, and generally represent Owner in all dealings with the Archi tects and General Contractor (s) , its subcontractors, suppliers, agents and employees. (e) Manager will initiate, process, submit and obtain approval of all necessary governmental permits for construction of the Improvements, including, but not limited to, any permits or applications relative to zoning, construction and occupancy of the Improvements. (f) Manager will negotiate and coordinate with all applicable utility companies, whether governmental or private, for the installation of all applicable utility services to the Property and the Improvements to insure the furnishing of such utility services to the Property and the Improvements on or before the date of completion of the Improvements. 6 ., , ; ,: , . I (g) Manager will review and make recommendations for all interior finishes and layouts for the core shell of the Improvements. (h) Manger will formulate separate Project Budgets for the Convention Center and the Parking Facilities for approval by Owner and shall make periodic reports, at least one each month, to Owner, showing the then present status of said costs incurred with respect to each such facility with a comparison to said estimated budget costs. Said development cost statements shall include not only the hard construction costs for the Improvements, but also all other costs as set forth on the Project Budgets and associated with the development and construction of the Property and the Improvements. As representative of Owner, Manager shall be authorized to direct the provision of goods and services for the Project within the budget parameters set forth on the Project Budget. (i) Manager will keep all records and documentation with regard to the progress of the construction of the Improvements and shall periodically, at least once each month, provide to Owner a status report as to the status of construction of the Buildings. (j) Manager will provide all administration and development services relative to the Improvements throughout the term of this agreement, and will secure from the Architects appropriate certificates of completion and from the applicable governmental authorities appropriate certificates of occupancy upon the completion of construction of each of the Improvements. 7 '\ , f . ,". (k) Manager will coordi~ate and administer the construction of the Improvements and shall be responsible for and provide all generally recognized services for construction coordination of the Improvements throughout the construction phase thereof. 4. Manager acknowledges that as an integral part of the services to be rendered by Manager hereunder, Manager is to unconditionally and irrevocably guarantee to Owner and does hereby unconditionally and irrevocably guarantee to Owner that the total costs as set forth in the Convention Center Project Budget shall not exceed the sum of $3,900,000.00 and that the total costs as set forth in the Parking Facilities Project Budget shall not exceed the sum of $3,816,000.00 and that said sums are sufficient for the development, design, and construction of the Convention Center and Parking Facilities, respectively, including the furnishing of and the payment of the cost of such "first class" furnishings, fixtures, and equipment as may be reasonably required to operate the same. Included in such Project Budgets shall be all sums to be paid to the Manager hereunder and all costs, fees, and expenses to be incurred in obtaining financing for the Parking Facilities in said amount of $3,816,000.00 if obtained through revenue bonds to be issued by the Downtown Development Authority of the City of Augusta including specifically, but not exclusively, all court costs, legal fees, accounting fees, trustee's fees, underwriting fees (if applicable), printing and usual and customary fees paid to the authority issuing such bonds. Owner and Manager each 8 '.' acknowledge that the total amount of the Project Budgets for both the Convention Center and the Parking Facilities are based on the understanding and agreement that the Project Scope is in accordance with those preliminary drawings, plans, specifications, and criteria prepared by the Architects and described on "Exhibit C" attached hereto, incorporated herein and made a part hereof by reference. Based on the above understandings, Manager guarantees the completion of the design and construction of the Improvements and the furnishing and installation of all furnishings, fixtures and equipment therein for a cost not to exceed the costs set forth on the respective Project Budgets, and in the event the same should exceed the total cost of the Project Budgets, Manager shall cause the same to be completed with Manager's own funds; provided, however, that the following are conditions precedent to any of Manager's obligations under this section: (a) Owner must supply and advance or cause to be supplied and advanced from time to time, but not more frequently than monthly, for utilization by Manager during the construction period, in accordance with a development and construction schedule prepared by Manager, funds for the development and construction of the Project which, in the aggregate, will equal to the total cost of the Project as set forth on the Project Budget which will reasonably represent work in place and materials stored on the site less ten percent retainage pending completion and will be advanced by Owner based upon requisitions approved by the Architect and by Owner's Project representative; 9 . , ; . , (b) The Project Scope as set forth in the final plans and specifications prepared by the Architect, which must be approved by both Owner and the Manager, shall not be increased beyond that set forth on attached "Exhibit C" unless both parties hereto agree to same; (c) The General Contractor must be selected from a list of Contractors preapproved by Manager. In this regard, Owner and Manager acknowledge that after completion of the final plans and specifications for the construction of the Project, Owner shall furnish to Manager the list of general construction companies (and the bond surety of each) seeking to be included on the preapproved list of contractors to bid the construction of the Project. Owner shall also furnish with respect to each of said companies such information with respect to finances, experience, personnel, and other pertinent subject and such other information and data as may be requested by Manager, and Owner shall require representatives of each of said companies to provide to Manager any other information as may reasonably to requested by Manager. within fifteen (15) days after such list and information is furnished to Manager, Manager shall notify Owner of any company (or surety) which it does not approve; provided however, that Manager shall not unreasonably withhold such approval. Failure to so notify Owner shall be deemed an approval of same; and (d) As of the bid date for the construction of the Improvements, Augusta Riverfront Limited Partnership ("Partnership") must let contracts for and have commenced 10 construction of and not ~ave abandoned or announced any delay its plans to construct a hotel and office complex adjoining the Improvements to the satisfaction of Owner. 5. As consideration and payment for the services to be provided by Manager hereunder, Owner shall pay to Manager a fee equal to the sum of the following: (a) Three percent (3%) of the Project Cost; plus (b) Twenty-five percent (25%) of the Project Savings. The portion of said fee to be paid to Manager pursuant to subparagraph (a) above shall be paid by Owner to Manager on a monthly basis throughout the pre-construction and construction terms of the Improvements, and shall be paid to Manager in direct proportion to the payments to the General Contractor (s) constructing the Improvements and the other third parties providing services for the Project as set forth in the Project Budget at such time as the General Contractor(s) shall draw its progress payments for such construction or said third party shall receive payments for such services, as applicable. The portion of said fee to be paid to Manager pursuant to subparagraph (b) above, if any, shall be paid to Manager at such time as all the items set out on the Project Budgets to be performed have in fact been completed. The Owner shall retain third-party architectural and engineering representation, throughout the pre-construction and construction terms of the Improvements. Such representatives shall be present at meetings of architectural, engineering and construction staff employed by the Manager and shall have on-site 11 .' residence during the construction phase. Fees to be paid to such third-party representative(s) shall also be included in and paid from the Project Budgets, but shall not exceed one percent (1%) thereof. 6. In the event that at the completion of the Improvements in accordance wi th the approved plans and specifications and all costs have been paid in full there shall be Project Savings, same shall be distributed as follows: (a) Twenty-five percent (25%) of same shall be paid to Manager as provided in Section 5 above. (b) Seventy-five percent (75%) shall be retained by Owner. 7. In fulfilling its functions and duties as required hereunder, Manager shall employ personnel of sufficient number and qualifications to provide the services and functions required hereunder, and shall pay all costs therefor. 8. Manager shall afford Owner the full benefit of the judgment, experience and advice of the members of its organization in respect to the policy to be pursued in developing the Property and in constructing the Improvements. Manager agrees to perform the services covered by this agreement in a diligent, careful and vigilant manner, and to follow in such construction coordination all standard and useful practices. 9. Manager agrees to comply with all applicable governmental rules and regulations including anti-discrimination laws and shall not perform or do any act, nor permit any act to be 12 ~ - > . , done, which would constitute a violation of any or all such laws or regulations. 10. The term of this agreement shall expire on the completion date of the construction of the Improvements and the completion of all services to be rendered by Manager relative thereto 'and pursuant to the terms of this agreement. The date of completion of construction of the Improvements shall be deemed to be the date on which Manager shall have furnished to Owner both a certificate of substantial completion certified by the Architects for the Improvements and a certificate of occupancy for the Improvements issued by the appropriate officials of Richmond County, Georgia. 11. Any notice required or permitted hereunder shall be in writing and shall be either: (a) Delivered in person to the foregoing named parties, (b) sent by same day or overnight courier service, or (c) sent by certified or registered united states Mail, return receipt requested, postage and charges prepaid, to the following addresses: TO OWNER: City Council of Augusta, Georgia Augusta-Richmond County Municipal Building 530 Greene street Augusta, Georgia 30911 Attention: Clerk of Council WITH COPY TO: Mr. Paul H. Dunbar, III City Attorney Nixon, Yow, Waller & Capers 1500 First union Bank Building (30910) 699 Broad street Augusta, Georgia 30901 13 .~ , .. ,WITH COPY TO: Mr. Hale Barrett Hull, Towill, Norman and Barrett, P.C. 801 Broad street, 7th Floor (30901) Post Office Box 1564 Augusta, Georgia 30913 TO DEVELOPER: Bailey & Associates 6190 Powers Ferry Road suite 100 Atlanta, Georgia 30339 WITH COPY TO: Mr. J. Littleton Glover, Jr. Glover & Davis, P.A. Post Office Box 1038 (30264) 10 Brown street Newnan, Georgia 30263 Any notice delivered or mailed as aforesaid shall, if delivered in person, be deemed received upon the date of delivery, if couriered by same day or overnight delivery be deemed received on the date of delivery regardless if accepted, and if mailed, such notice shall be deemed received upon the date of actual receipt or the third calendar day subsequent to date of postmark, whichever is earlier. Each party hereto may change its address for notice from time to time by notifying the other party hereto of the new address in the manner provided above. 12. without the prior written consent of the other party hereto, the obligations, duties and benefits of each party hereunder may not be assigned; except that owner deems it convenient or necessary, Owner may act as agent for The Downtown Development Authority of Augusta if Owner selects that entity to be the Owner of the Parking Facilities. 13. This agreement sets forth the entire agreement of the parties with respect to the subject hereof, and cannot be 14 .. r t .. ~ . . " modified orally or in any manner other than '~y an agreement in writing signed by each party hereto or their assigns as permitted hereunder. 14. Subject to the provisions of Item 12 above relative to assignability, this agreement shall be binding upon and insure to the benefit of not only the parties hereto, but also their respective successors and assigns. 15. This agreement shall be governed by and interpreted in accordance with the laws of the State of Georgia. IN WITNESS WHEREOF, the parties hereto have caused their names to be signed and' their seals to be affixed, all by their duly authorized partners or officers as of the day and year first above written. CITY COUNCIL OF AUGUSTA, GEORGIA By: Mayor, City of Augusta Attest: Clerk of Council BAILEY & ASSOCIATES, Manager By: Bailey Realty, Inc., Managing General Partner By: President Attest: Secretary 15 . :.... .. E>\-HI~D -=:D , ,. .. .i"f STATE OF GEORGIA I ) ) COUNTY OF RICHMOND ) EXCHANGE AGREEMENT THIS AGREEMENT made and entered into this day of June, 1989, by and between BANKERS FIRST CORPORATION ("Bankers First") and CITY COUNCIL OF AUGUSTA, GEORGIA ("City"). WHEREAS, City has entered into an agreement with the United States Department of Housing and Urban Development, ("HUD") which agreement awards to city an urban development action grant in the amount of Seven Million, Five Hundred Sixty-Two Thousand, Four Hundred Fifty-Four Dollars ($7,562,454) (the "UDAG"); and WHEREAS, the proceeds of the UDAG will be used to finance a portion of the construction of an office building and hotel and City has agreed to construct a conference center and parking facility in accordance with the UDAG application which is referred to herein as the Augusta Riverfront Project; and WHEREAS, the conference center and parking facility will be constructed on a portion of the land included in the Augusta Riverfront Project; and WHEREAS, Bankers First corporation or one of its wholly owned subsidiaries owns the real estate on which the convention center, parking deck and surface parking facilities will be constructed as well as other land which the City needs in order to complement its Riverwalk Park; and WHEREAS, the property which the City needs has been appraised by an independent appraiser selected by City as having a value in excess of Nine Hundred Thousand Dollars ($900,000); and WHEREAS, Bankers First is willing to exchange with the City all of said properties in return for property currently owned by the City and similarly appraised by an appraiser selected by city as having a value of less than Two Hundred Thousand Dollars ($200,000) together with the sum of Five Hundred Thousand Dollars ($500,000) in cash; and WHEREAS, the parties wish to evidence such agreement by this document. NOW, THEREFORE, for and in consideration of the mutual promises contained herein it is agreed that: 1. Bankers First will cause to be conveyed to the City Parcels "B", "0" and "E" as shown on that certain plat prepared for Augusta Riverfront Limited Partnership dated May 10, 1989, and revised June 6, 1989, a copy of which is attached hereto as Exhibit "A" and incorporated herein by reference. Bankers First will also cause to be conveyed to city by lease agreement for One Dollar ($1. 00) per year the right to use Parcel "C" and portions of Parcel "A" shown on said plat for surface parking so that city shall have space (including the spaces within the parking deck) to park 775 cars for as long as the debt incurred in the construction of the total parking facility is outstanding. Additionally, Bankers First shall 2 ',/ ..~ t .. I convey to City a permanent easement twelve feet in width along a route to be determined from time to time by Bankers First through said Parcel "A" to allow City vehicles access to the ramp to the levee located adjacent to said Parcel "D". 2 . As consideration for the above-described conveyance, the City will convey to Bankers First or its designee a portion of McCartan street shown on said plat as Parcel "F" and an alley known as Tatnall Alley shown on said plat as Parcel "G" and property located on the corner of Ninth and Reynolds street formerly known and utilized as the City Police Barracks and Recorders Court and more particularly described on Exhibit "B" attached hereto and incorporated herein by reference, and will also pay to Bankers First or its designee the sum of Five Hundred Thousand Dollars ($500,000) .cash. 3. All conveyances shall be by deeds containing general warranties conveying full marketable fee simple title, subject to easements of record and applicable zoning ordinances, except that with respect to Parcels "F" and "G" which are respectively known as the extension of McCartan street and Tatnall Alley the City shall abandon any rights of City thereto and shall convey by quit-claim deed its remaining interest therein, if any. Additionally, city shall quit claim any interest that it might have to Parcel "A" as a result of streets or alleyways that may have formerly extended through Parcel "A". 3 .... . .. , , 4. The lease for the surface parking spaces shall contain provisions reserving air rights for construction of improvements above surface parking or for substitution of additional property for surface parking which shall be located in the immediate area and shal+ also have a provision allowing Bankers First to retire a portion of the indebtedness on the parking facility to replace revenue lost should any of said parking spaces be eliminated. 5. The closing contemplated by this Agreement will take place on two days written notice given by Bankers First. 6. The cash consideration shall be paid at closing in immediately available funds. 7. Any and all ad valorem real estate taxes assessed against any property interest to be conveyed to City by Bankers First for 1989 or any year prior thereto shall be paid by Bankers First. 8. Each of the parties represent to the other that there will be no commissions or brokerage fees of any kind. 9. The property exchanged herein shall be reconveyed and each of the parties shall be restored to its previous position if the UDAG is not closed on or before September 1, 1989, and the City shall be reimbursed its Five Hundred Thousand Dollar ($500,000) paYment together wtih interest thereon during the time from the date of closing to the date of such repaYment computed at the average rate paid on other funds which the City has deposited in local financial institutions during such period. 4 ~ , , ,.......- ,~ '.'... .. . ' 10. The rights, powers, I privileges and duties contained herein shall be binding upon the successors and assigns of the parties hereto and shall be assignable without prior written consent of the other parties. IN WITNESS WHEREOF, the undersigned have hereunto caused the execution of this instrument by and through its duly authorized officers and agents on the date first above written. SIGNED, SEALED AND DELIVERED ) ) IN RICHMOND COUNTY, GEORGIA ) ) IN THE PRESENCE OF: ) ) ) ) ) NOTARY PUBLIC, RICHMOND ) COUNTY, GEORGIA ) MY COMMISSION EXPIRES: ) ) SIGNED, SEALED AND DELIVERED ) ) IN RICHMOND COUNTY, GEORGIA ) ) IN THE PRESENCE OF: ) ) ) ) ) NOTARY PUBLIC, RICHMOND" ) COUNTY, GEORGIA ) MY COMMISSION EXPIRES: ) ) BANKERS FIRST CORPORATION BY: PRESIDENT ATTEST: SECRETARY CITY COUNCIL OF AUGUSTA, GEORGIA BY: ITS MAYOR ATTEST: ITS CLERK OF COUNCIL 5