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Exhibit 10.5
COMMON AREA EASEMENT AND
MAINTENANCE AGREEMENT
BY AND AMONG
GATEWAY ECONOMIC DEVELOPMENT
CORPORATION OF GREATER CLEVELAND
AND
BALLPARK MANAGEMENT COMPANY
DATED AS OF JULY 3, 1991
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TABLE OF CONTENTS
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PAGE
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ARTICLE I DEFINITIONS AND EXHIBITS .................................... 2
1.1 Definitions ........................................... 2
1.2 Exhibits .............................................. 7
ARTICLE II USE, CONTROL, MAINTENANCE AND
REPAIR OF COMMON AREAS ...................................... 7
2.1 Easements in Common Areas ............................. 7
2.2 Future Designated Areas ............................... 7
2.3 Control of Common Areas ............................... 7
2.4 Maintenance and Repair of Common Areas ................ 8
2.5 Self-Help ............................................. 8
2.6 Special Provisions for Area and Arena Land ............ 8
2.7 County Provision ...................................... 9
ARTICLE III LIGHTING OF COMMON AREAS .................................... 9
ARTICLE IV COMMON AREA SIGNS AND ADVERTISING ........................... 9
4.1 Content, Location, Design and
Appearance ............................................ 9
4.2 Joint Marketing Opportunities ......................... 10
ARTICLE V SECURITY OF COMMON AREAS .................................... 11
ARTICLE VI INSURANCE ................................................... 11
6.1 Construction Periods .................................. 11
6.2 Post-Construction Period .............................. 11
6.3 Insurance Requirements ................................ 12
6.4 Waiver of Subrogation ................................. 13
6.5 Certificates .......................................... 13
ARTICLE VII REAL ESTATE TAXES ........................................... 12
ARTICLE VIII CONCESSIONS ................................................. 14
ARTICLE IX PARKING ..................................................... 14
9.1 Designated Parking Areas .............................. 14
9.2 On-Site Parking ....................................... 15
9.3 Additional Parking .................................... 15
9.4 Lessee's Parking Revenue .............................. 15
ARTICLE X COMMON AREA NET REVENUE SHARING ............................. 16
10.1 Payment of Net Revenues ............................... 16
10.2 Audit ................................................. 16
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ARTICLE XI MISCELLANEOUS ............................................... 16
11.1 No Amendment of Baseball Facility
Agreements ............................................ 16
11.2 Notices ............................................... 16
11.3 Covenants Running with the Land ....................... 18
11.4 Breach Shall Not Permit Termination ................... 18
11.5 Estoppel Certificates ................................. 19
11.6 Terms ................................................. 19
11.7 No Joint Venture ...................................... 19
11.8 Headings .............................................. 19
11.9 Agreement Contains All Terms .......................... 19
11.10 Governing Law ......................................... 19
11.11 Cross References ...................................... 19
11.12 Force Majeure ......................................... 19
11.13 Amendment, Waiver ..................................... 20
11.14 Consent ............................................... 20
11.15 Severability .......................................... 20
11.16 Accord and Satisfaction ............................... 20
11.17 Further Assurances .................................... 21
11.18 No Third Party Beneficiary ............................ 21
11.19 Conforming Amendments ................................. 21
11.20 Counterparts .......................................... 21
11.21 Term .................................................. 21
ARTICLE XII THREE PARTY AGREEMENT AND
CENTRAL MARKET COMMUNITY DEVELOPMENT PLAN ................... 21
ARTICLE XIII LEAGUE APPROVAL ............................................. 22
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COMMON AREA EASEMENT AND MAINTENANCE AGREEMENT
THIS COMMON AREA EASEMENT AND MAINTENANCE AGREEMENT (hereinafter this
"Agreement") is made as of this 3rd day of July, 1991, by and among GATEWAY
ECONOMIC DEVELOPMENT CORPORATION OF GREATER CLEVELAND, a nonprofit corporation
organized under the laws of the State of Ohio (hereinafter referred to as
"Gateway"), CLEVELAND INDIANS BASEBALL COMPANY LIMITED PARTNERSHIP, an Ohio
limited partnership (hereinafter referred to as the "Lessee") and BALLPARK
MANAGEMENT COMPANY, an Ohio corporation (hereinafter referred to as the
"Operator").
RECITALS:
A. Gateway is the fee owner of a parcel of land consisting of
approximately 28 acres located generally west of East Ninth Street, south of
Huron Road, east of Ontario Street and north of Carnegie Avenue, in the City of
Cleveland (the "City"), Cuyahoga County (the "County"), Ohio, commonly referred
to as the Central Market Square Site and more fully described in Exhibit A
attached hereto and made a part hereof (the "CMS Site").
B. Gateway intends to construct a Baseball Facility (as defined in the
Lease Agreement) on a portion of the CMS Site for the purpose of staging home
games for the Lessee and other special events, including civic and charitable
events.
C. Gateway and the Lessee have executed and delivered the Lease
Agreement (as hereinafter defined), pursuant to which Gateway has leased to the
Lessee Gateway's interest in the Ballpark Land and the Ballpark Improvements
(both as defined in the Lease Agreement).
D. Gateway and the Lessee have executed and delivered the Ground Lease
(as hereinafter defined) pursuant to which Gateway has leased to the Lessee
Gateway's fee interest in the Field and the Field Improvements (both as defined
in the Ground Lease).
E. Gateway and the Operator shall execute and deliver the Management
Agreement (as hereinafter defined) pursuant to which Gateway shall grant to the
operator the exclusive right and obligation to manage and operate the Baseball
Facility.
F. With respect to the remaining property in the CMS Site, Gateway has
agreed to grant to the Lessee and the Operator and the operator of the Arena for
the benefit of and as an appurtenance to the Baseball Facility and the Arena
certain easements with respect thereto and the parties desire to provide for the
division of costs and expenses for the maintenance, operation, repair, or
replacement of such areas and the facilities
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located therein (hereinafter defined as the "Common Areas") and to impose
covenants and obligations with respect to the use or operation thereof.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, and for one dollar ($1.00) paid by each of the parties to the
other, the receipt and sufficiency of which is hereby mutually acknowledged, the
parties agree as follows:
ARTICLE I
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DEFINITIONS AND EXHIBITS
A. DEFINITIONS. As used in this Agreement and unless otherwise
expressly indicated herein, the following terms shall have the following
meanings:
"ADDITIONAL PARKING" shall have the meaning set forth in Section 9.3
hereof.
"AFFILIATE(S)" shall mean as to any named individual or entity: (a) any
individual or entity directly or indirectly owning, controlling or holding with
power to vote, fifty percent (50%) or more of the outstanding voting interests
of such named entity; (b) any entity fifty percent (50%) or more of whose
outstanding voting interests are, directly or indirectly, owned, controlled or
held with power to vote by such named individual or entity; (c) any entity or
individual directly or indirectly controlling, controlled by or under common
control (using ownership of fifty percent (50%) or more of the outstanding
voting interests as a test for determining control with respect to an entity)
with such named individual or entity; (d) any trustee, officer, director or
general partner of such named entity; or (e) if a named individual or entity is
an officer, director, general partner, trustee of an entity, such entity.
"AGREEMENT" shall mean this Common Area Easement and Maintenance
Agreement.
"ARENA" shall have the meaning set forth in the Lease Agreement.
"ARENA LAND" shall have the meaning set forth in the Lease Agreement.
"ARENA PARKING" shall have the meaning set forth in the Lease
Agreement.
"BALLPARK IMPROVEMENTS" shall have the meaning set forth in the Lease
Agreement.
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"BALLPARK LAND" shall have the meaning set forth in the Lease
Agreement.
"BASEBALL CONCESSIONS" shall mean any and all concessions, merchandise,
novelties or other articles (other than food or beverage) of the type or
substantially similar to such products provided by the Operator or its licensees
or concessionaires in the Baseball Facility or sold in the gift shops located in
the Baseball Facility.
"BASEBALL FACILITY" shall have the meaning set forth in the Lease
Agreement.
"BASEBALL FACILITY AGREEMENTS" shall mean, collectively, the Lease
Agreement, the Management Agreement and the Ground Lease.
"BONDS" shall have the meaning set forth in the Lease Agreement.
"BUSINESS DAY" shall mean any day other than a Saturday, a Sunday or a
public or bank holiday or the equivalent for banks generally under the laws of
the State of Ohio.
"CENTRAL MARKET COMMUNITY DEVELOPMENT PLAN" shall mean the Central
Market Community Development Plan approved by Council of the City on September
29, 1986, and amended on November 5, 1990 and June 17, 1991.
"CITY" shall mean Cleveland, Ohio.
"CMS SITE" shall mean the site plan of the CMS Site attached hereto as
Exhibit B and made a part hereof.
"COMMON AREAS" shall mean those portions of the CMS Site (other than
(i) the Baseball Facility; (ii) from and after the execution of an amendment to
this Agreement pursuant to Section 2.6 hereof by the operator and lessee of any
sports facility constructed pursuant to the Three Party Agreement, including,
but not limited to, the operator and lessee of the Arena, the Arena Land and the
Arena Parking; and (iii) areas designated pursuant to Article II hereof),
including, but not limited to, the On-Site Parking, the Additional Parking (to
the extent located in the CMS walkways, seating and other amenities, landscaped
areas, curbs, exterior and interior ramps, ingress and egress streets, access
and perimeter roads, storm or sanitary sewers, common underground utility lines,
bus and taxi stands.
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"COMMON AREA EXPENSES" shall mean all costs related to maintaining,
managing, operating, equipping, policing, securing, repairing, replacing and
protecting the Common Areas, including, but not limited to, cleaning, lighting,
removal of snow, trash, dirt and debris; and all expenses incurred in connection
with obtaining and maintaining the insurance coverage described in Article VI
hereof; maintenance and construction work required to preserve and maintain the
utility and appearance of the Common Areas; operating, maintaining, repairing
and replacing machinery and equipment used in the operation and maintenance of
the Common Areas or any rent paid for the leasing of any such machinery and
equipment; enforcing any operating agreements pertaining to the Common Areas or
any portion thereof, or any arbitration or judicial actions undertaken with
respect to the same; policing and security, including uniforms, equipment and
supplies; acquisition, installation, maintenance and operation of any cost
savings devices or equipment; advertising and directional signs; pest
extermination; payroll, payroll taxes and reasonable employee benefits of
management personnel, including, without limitation, security and maintenance
personnel, but excluding excessive compensation of executive and administrative
personnel; and an administrative cost equal to ten percent (10%) of the total
cost and expense of all the foregoing included costs.
"COMMON AREA NET REVENUE" shall mean the Common Area Revenue LESS
Common Area Expenses.
"COMMON AREA REVENUE" shall mean any and all cash and other property
from time to time actually received by Gateway from any source located or
operated in or from the Common Areas by Gateway or its designees, including, but
not limited to, all revenue from concessions, parking, advertising and special
events operated from or conducted in the Common Areas.
"COMPLETION DATE" shall have the meaning set forth in the Lease
Agreement.
"CONCESSIONAIRE" shall have the meaning set forth in Section 2.3 of the
Management Agreement.
"CONCESSIONS" shall mean any and all food, beverage, eating facilities
or vending machines.
"COUNTY" shall mean Cuyahoga County, Ohio.
"EMERGENCY" shall mean an event or occurrence which requires immediate
remedial action (a) for the protection of persons or property; or (b) to comply
with any legal requirement to the extent that noncompliance therewith would
materially adversely affect the operations or property or would result, or may
be asserted or alleged to result, in criminal or civil liability of Gateway, the
Lessee or the Operator.
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"EVENT PERIOD" shall mean the period commencing three (3) hours prior
to and two (2) hours after any Home Date or Special Event conducted at the
Baseball Facility.
"FORCE MAJEURE" shall mean acts of God, fire or other casualty,
earthquake, flood, epidemic, landslide, enemy act, war, holocaust, riot,
intervention by civil or military authorities of government, insurrection or
other civil commotion, general unavailability of certain materials, strikes,
boycotts or labor disputes beyond the control of either party hereto that cause
such party to be delayed or hindered in, or prevented from, the performance of
any covenant or obligation hereunder, other than one for the payment of money.
"GROUND LEASE" shall mean the document so titled by and between Gateway
and the Lessee and dated of even date herewith.
"HOME DATE" shall have the meaning set forth in the Lease Agreement.
"INTEREST RATE" shall mean the interest rate of two percent (2%) above
the rate of interest per annum then charged to large corporate borrowers of the
highest credit standing for short-term unsecured obligations, but in no event
exceeding the maximum legal rate permitted to be charged to the Lessee, the
Operator or Gateway, whichever is less.
"LEASE AGREEMENT" shall mean the document so titled by and between
Gateway and the Lessee and dated of even date herewith.
"MANAGEMENT AGREEMENT" shall mean the document so titled by and between
Gateway and the Operator and dated of even date herewith.
"NOTICE" shall have the meaning set forth in Section 11.2 hereof.
"ON-SITE PARKING" shall have the meaning set forth in Section 9.2
hereof.
"PERMITTEE" shall mean owners and lawful occupants of any portion of
the CMS Site and their respective officers, directors, employees, agents,
partners, contractors, customers, visitors, invitees, licensees and
concessionaires.
"PERMITTEE" shall mean owners and lawful occupants of any portion of
the CMS Site and their respective officers, directors, employees agents,
partners, contractors, customers, visitors, invitees, licensees and
concessionaires.
"PRIVATE STREETS" shall mean any and all streets, routes, roads, ways
or thoroughfares that are open for use and located on the CMS Site not
designated as Public Streets.
"PUBLIC STREETS" shall mean all streets, routes, roads, public ways or
thoroughfares owned and controlled by the City.
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"REPORTING PERIOD" shall mean, from and after the date of this
Agreement, each calendar quarter ending on March 31, June 30, September 30 and
December 31.
"SECURITY FORCE" shall mean licensed, bonded and trained personnel
including, without limitation, off-duty police officers employed for the purpose
of guarding and protecting persons and property from injury, theft and harm.
"SERVICE LINES" shall mean any pipeline, utility line, electrical line,
gas line, cable, sanitary or storm sewer, pipe, vent, conduit, duct or other
line or wire that provides or distributes Utility Service to the CMS Site,
including, without limitation, all mechanical, plumbing, heating, ventilating
and other fixtures and equipment necessary for such provision or distribution to
the CMS Site.
"SIGNS" shall mean directional, promotional or advertising signs,
signboard frames and appurtenant fixtures designed for public display of
information, including, but not limited to, information concerning or related to
the Lessee, the Operator or the Baseball Facility.
"SITE AND ON-SITE PARKING REQUIREMENTS" shall have the meaning set
forth in the Lease Agreement.
"SPECIAL EVENT" shall have the meaning set forth in the Lease
Agreement.
"TERM" shall mean the period commencing on the Completion Date and
ending on the earlier of (a) December 31 of the year in which the twentieth
(20th) full Season (as defined in the Lease Agreement) following the Completion
Date is concluded, or (b) upon the retirement, defeasance or discharge (as
provided in The three Party Agreement) of all Bonds, (c) the termination of the
Ground Lease, or (d) the termination of the Lease Agreement.
"THREE PARTY AGREEMENT" shall mean that certain Agreement Relating to
Ownership, Financing, Construction and Operation of a Sports Facility and
Related Economic and Redevelopment Projects, dated as of November 7, 1990, by
and among the County, the City and Gateway.
"UTILITY SERVICE" shall mean the furnishing of water, electricity, gas,
electric, electronic communications, telephone, storm or sanitary drainage and
any other similar or related power or information transmission lines.
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1.2 EXHIBITS. The following Exhibits are attached to and form a part of
this Agreement:
Exhibit A - Legal description of CMS Site
Exhibit B - CMS Site Plan
ARTICLE II
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USE, CONTROL, MAINTENANCE AND
REPAIR OF COMMON AREAS
2.1 EASEMENTS IN COMMON AREAS. During the Term, here are hereby created
for the benefit of the Baseball Facility easements for the use of the Common
Areas in accordance with the purposes for which the Common Areas were designed
and intended. Said easements shall be used and enjoyed in common by all owners,
operators or lessees of the Baseball Facility, including, but not limited to,
the Lessee, the Operator and Gateway and by their respective Permittees, in
connection with the development, use and enjoyment of their respective
properties, subject to the terms and conditions hereof (including, without
limitation, terms and conditions that may result in the designation of portions
of the present Common Areas for exclusive use) and further subject to the
Baseball Facility Agreements and reasonable rules and regulations adopted by
Gateway and approved by the Lessee and the Operator. Notwithstanding the
preceding, Lessee and Operator shall enter into an amendment to this Agreement
and any common area easement agreement filed for record, to expressly exclude
from the Common Areas the Arena, the Arena Land and the Arena Parking, as more
fully set forth in Section 2.6 hereof and to include the benefits of the
easements hereby created to the lawful owners, operators and lessees of the
Arena and their respective Permittees.
2.2 FUTURE DESIGNATED AREAS. No part of the Common Areas may be
designated for another use without the prior written consent of the Lessee and
the Operator, which consent may be withheld in the sole and absolute discretion
of the Lessee and the operator if such future development would: (a) materially
adversely affect, in the opinion of the Lessee or the operator, the operations
of the Baseball Facility; (b) reduce the On-Site Parking; (c) result in the loss
or obstruction of natural light or ventilation to the Baseball Facility; or (d)
be aesthetically incompatible, in the opinion of the Lessee or the Operator,
with the design or appearance of the Common Areas or the Baseball Facility.
2.3 CONTROL OF COMMON AREAS. Except as may otherwise be expressly
provided for herein or in the Baseball Facility Agreements, Gateway shall have
the right to control, manage, and direct the Common Areas in accordance with the
purposes for which
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the Common Areas are designed and intended; provided, however, that Gateway,
without the prior written consent of the Lessee and the Operator, which consent
shall not be unreasonably withheld or delayed, shall not (a) modify, restrict or
otherwise control ingress to and egress from the Common Areas; (b) conduct
promotions, festivals, shows, displays, and other activities and events in the
Common Areas during any Event Period; (c) sell or permit to be sold Concessions
in the Common Areas during any Event Period; (d) materially change the location
of, enlarge, reduce or otherwise alter the Common Areas except for providing for
designated areas contemplated by the Baseball Facility Agreements, such as
On-Site Parking, or (e) enter into material contracts with respect to the use of
the Common Areas.
2.4 MAINTENANCE AND REPAIR OF COMMON AREAS. Gateway covenants and
agrees, at Gateway's expense, to maintain, repair and replace and keep in good
order, condition and repair the Common Areas, including, without limitation, all
facilities, structures, Service Lines and Private Streets located in or forming
part of, the common Areas. For purposes of this Agreement, "maintenance,"
"maintain" or "repair" shall mean keeping the Common Area and its improvements
in a good, safe and sanitary condition and appearance, promptly making all
foreseen and unforeseen, and ordinary and extraordinary, changes, repairs and
improvements of every kind and nature required to be made in order to keep and
maintain the Common Areas and its improvements in good, safe and sanitary
condition and appearance, promptly collecting and removing therefrom all
rubbish, litter and debris, and promptly removing, to the extent reasonably
practicable, snow, ice and surface waters, all in compliance with all applicable
laws, ordinances and regulations including, without limitation, applicable
environmental regulations.
2.5 SELF-HELP. In the event that Gateway fails to discharge its
maintenance and repair obligations hereunder within a reasonable time after
receiving notice of such failure from the Lessee or the Operator, the Lessee or
the Operator shall have the right to perform such maintenance or repair and
charge Gateway with the reasonable cost thereof plus an overhead charge of ten
percent (10%) of such costs. In addition to, and without limiting in any way the
Lessee's or the Operator's rights and remedies at law or equity, the Lessee or
the Operator may, with notice to Gateway, and at any time or from time to time,
charge, setoff and otherwise apply all or any part of the Lessee's or the
Operator's Obligations (as defined in the Baseball Facility Agreements) other
than the operator's obligations pursuant to Article VI of the Management
Agreement, against any of Gateway's obligations under this Agreement.
2.6 SPECIAL PROVISIONS FOR ARENA AND ARENA LAND. The Lessee and the
operator acknowledge that Gateway is attempting to develop the Arena on the
Arena Land and that Gateway has entered into that certain Memorandum of Intent
with the Cavaliers Division
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of Nationwide Advertising Services, Inc. and Selkirk Arena Management, Inc.
(jointly referred to herein as the "Cavs") to lease the proposed Arena to the
Cavs. Upon the execution and delivery of formal agreements for the lease of the
Arena, the parties intend to provide the opportunity for the Cavs, or such other
developer of the Arena Land, including, but not limited to, the Operator or
lessee of the Arena, to join in the execution of this Agreement pursuant to an
amendment hereto, which amendment shall: (i) not materially alter or impair the
Lessee's or the Operator's rights hereunder, (ii) provide to operators of the
Arena, similar rights to those provided the Operator herein, and (iii) provide
for equitable arrangements for preserving such respective rights during
overlapping events. The Lessee and the operator agree to enter into any
necessary amendments to any recorded common area easement agreements to reflect
the amendments to this Agreement and to evidence of record the exclusion from
the Common Areas, the Arena, the Arena Land and Arena Parking as provided
herein.
2.7 COUNTY PROVISION. The Lessee and the Operator acknowledge that
Gateway may assign to the County (or such other governmental entities as are
approved by the Lessee and the Operator) certain rights and request that the
County assume certain obligations of Gateway hereunder and the Lessee and the
Operator agree to enter into any necessary amendment hereto to accomplish such
assignments to and assumption by the County, provided such amendment shall not,
in any way, materially alter or impair the Lessee's or the Operator's rights
hereunder. The parties agree that such assignment must occur prior to the
expiration of the five-year period commencing upon the Completion Date as
defined in the Lease Agreement.
ARTICLE III
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LIGHTING OF COMMON AREAS
Gateway agrees to keep all Common Areas well lighted, at Gateway's
expense, during any period that the Baseball Facility is open for business to
the public and for reasonable times before and after such periods. Gateway
further agrees to maintain and keep lighted for security purposes, seven days
each week during the hours of darkness, security lights sufficient to illuminate
the exterior Common Areas at a minimum level of one (1) foot-candle at grade.
ARTICLE IV
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COMMON AREA SIGNS AND ADVERTISING
4.1 CONTENT, LOCATION, DESIGN AND APPEARANCE. The content, location,
design and appearance of all Signs located in
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the Common Areas shall be subject to the prior written approval of the Lessee
and the Operator, which approval shall not be unreasonably withheld. The
Operator shall be entitled to operate, and retain the revenues generated
therefrom, one (1) free-standing, movable or non-movable, lighted Sign in the
Common Area, in an area selected by the Operator and approved by Gateway; such
sign to be treated as an advertising sign on the exterior of the Baseball
Facility and governed by the terms and conditions of the Management Agreement
and the Lease Agreement as such. Gateway shall maintain in good condition and
repair, and replace all Signs in the Common Areas that are damaged or in
disrepair; provided, however, that the Operator shall conduct all Capital
Repairs and Routine Maintenance (as defined in the Management Agreement) for the
sign referred to in the preceding sentence.
4.2 JOINT MARKETING OPPORTUNITIES. The parties recognize that the
Operator, Gateway and the operator of the Arena may derive extra value from
mutual cooperation between the parties in procuring advertising, vendor and
supplier contracts based upon the promotion of the Baseball Facility, the Arena
and the Common Areas as an integrated sports complex ("Joint Marketing
Opportunities"). Subject to the terms and conditions of the Baseball Facility
Agreements, the Operator and Gateway shall:
(a) use reasonable efforts to cooperate in exploring and
capitalizing on the benefits to be derived from Joint
Marketing opportunities; and
(b) allocate the incremental net income generated solely
as a result of Joint Marketing Opportunities and not
otherwise available to any of the parties but for the
Joint Marketing Opportunities as follows: (i)
one-third (1/3) to Gateway, (ii) one-third (1/3) to
the operator of the Arena, and (iii) one-third (1/3)
to the Operator and the Lessee, in the aggregate.
Any proposal for a Joint Marketing Opportunity must include (i) the
terms and conditions the proposing party would be willing to make available to
the Operator if such proposal were solely for the Baseball Facility, (ii) a
comparative economic analysis of the proposal solely for the Baseball Facility
and the Joint Marketing Opportunity; and (iii) sufficient detail to allow
independent verification by the Operator of the terms and conditions. Joint
Marketing Opportunities or any contracts entered into as a result thereof shall
not encumber or reduce, in any way, the revenues anticipated to be generated at
the Baseball Facility and available to the Lessee or the Operator. The Operator
and the Cavs will each have the right, in their sole discretion, to approve any
Joint Marketing Opportunities.
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ARTICLE V
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SECURITY OF COMMON AREAS
Gateway agrees to keep all Common Areas secure by employing and
maintaining a Security Force for the Common Areas, at Gateway's expense, during
any period that the Baseball Facility is open for business to the public, and
for reasonable times before and after such periods. Gateway shall provide a
security Force of sufficient size to adequately monitor the Common Areas and
such Security Force shall be flexible as to size dependent on the number of
persons anticipated to be present in the Common Areas.
ARTICLE VI
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INSURANCE
6.1 CONSTRUCTION PERIODS. Gateway shall, until the Completion Date and
any additional construction periods during which improvements are constructed in
the common Areas, maintain in full force and effect, at Gateway's expense: (a)
insurance against damage or destruction to any Common Area improvements for the
full value thereof, including all materials, equipment, machinery and supplies
for use in construction or installation of any Common Area improvements on an
"all risk" peril basis, including coverage against flood, sewer backup and
earthquake, in the form of builder's risk coverage, and (b) cause its
professionals to carry professional liability insurance providing coverage for
errors and omissions relating to workmanship and design.
6.2 POST-CONSTRUCTION PERIOD. From and after the Completion Date,
Gateway, in its name, shall maintain in full force and effect the following:
(a) insurance against damage or destruction to Gateway's
equipment and other personal property, improvements
and betterments to the Common Areas by providing "all
risk" peril coverage in the amount of at least ninety
percent (90%) of replacement cost, subject to
deductible limits not to exceed $25,000. Such
insurance shall have an agreed amount endorsement;
(b) statutory workers' compensation coverage through the
State of Ohio, and Ohio Stop Gap Liability coverage
in the amount of $1,000,000 per occurrence, or such
lesser amount as may
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satisfy carriers of Gateway's umbrella or excess
liability coverage;
(c) "occurrence type" general liability insurance against
bodily injury and property damage arising from
occurrences in and about the Common Areas and
covering Gateway Is contractual liability for
indemnification under this Agreement. Such insurance
shall be written on a commercial general liability
policy form to include premises operations, products
and completed operations, personal injury/advertising
injury, independent contractors and broad form
property damage. The policy shall also contain a
general aggregate per location of not less than
$2,000,000 and a general occurrence and a
products/completed operations aggregate of not less
than $1,000,000 and naming the Operator and the
Lessee as additional insureds; and
(d) umbrella or excess liability coverage (in form no
less broad than underlying coverage) to apply excess
of automobile, general, contractual and employer's
liability limits, in an amount necessary to increase
overall coverage to $50,000,000 per occurrence and
naming the Operator and the Lessee as additional
insureds.
6.3 INSURANCE REQUIREMENTS.
(a) All policies of insurance required hereunder shall be
written by carriers which are members of the Ohio
Guaranty Fund and possess a policyholder's rating or
better and a minimum Class VII financial size
category as listed at the time of issuance by A.M.
BEST INSURANCE REPORTS ("Best Reports") (the
aforesaid rating classifications to be adjusted if
and to the extent that BEST REPORTS adjusts its
rating categories).
(b) All policies shall provide that they may not be
canceled, renewed or reduced unless at least thirty
(30) days' notice thereof has been provided to the
additional insureds. In no event shall any party be
required to insure for liability limits in excess of
coverage which is available at commercially
reasonable rates. In the event that tort liability
reform is adopted which makes the limits of liability
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hereinabove provided in excess of commercially
reasonable and prudent limits of liability, such
limits will be equitably reduced. The insurance
policies required hereunder shall be reviewed on an
annual basis to determine the adequacy of the
coverage amounts.
6.4 WAIVER OF SUBROGATION. Gateway, the Lessee and the Operator agree
that all insurance policies against loss or damage to property and business
interruption or rent/revenue loss, and all liability insurance policies required
hereunder, shall be endorsed to provide that any release from liability of, or
waiver of claim for, recovery from the other party entered into in writing by
the insured thereunder prior to any loss or damage shall not affect the validity
of said policy or the right of the insured to recover thereunder. Such insurance
policies shall further provide that the insurer waives all rights of subrogation
which such insurer might have against the other party. Without limiting any
release or waiver of liability or recovery contained in any other section of
this Agreement, but rather in confirmation and furtherance thereof, each of the
parties hereto waives all claims for recovery from the other party for any loss
or damage to any of its property or damages as a result of business
interruption, rent loss or liability of the types covered in Subsections 6.2(c)
and (d) above, insured under valid and collectible insurance policies to the
extent of any recovery collectible under such insurance policies.
6.5 CERTIFICATES. Not later than the date on which coverage is to be
provided hereunder, the party required to provide same shall furnish to the
other party a certificate evidencing the required coverage.
ARTICLE VII
-----------
REAL ESTATE TAXES
During the Term, Gateway shall pay when due all real estate taxes,
personal property taxes, assessments and other governmental levies and charges,
general and special, ordinary and extraordinary, of any kind or nature, lawfully
levied or assessed by federal, state, county or municipal government, upon or
with respect to the Common Areas and any and all other improvements hereafter
constituting a part of the Common Areas, or any payments in lieu thereof
(collectively, "Real and Personal Property Taxes"); provided, however, that if,
because of any change in the method of taxation of real estate or personal
property, any other or additional tax or assessment is imposed upon the
property, any other or additional tax or assessment is imposed upon the Common
Areas or in substitution for, or in lieu of, any tax or assessment which would
otherwise be included in Real and Personal Property Taxes, such other tax or
assessment shall also be Gateway's
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responsibility. Gateway hereby agrees to indemnify, defend and hold the Lessee
and the Operator harmless from and against all Real and Personal Property Taxes.
In the event the Operator's interest in the Management Agreement, or the
Lessee's interests in the Lease Agreement or the Ground Lease, is terminated as
a result of a failure to pay Real and Personal Property Taxes, including,
without limitation, a sale of the Baseball Facility pursuant to a foreclosure
sale, and within sixty (60) days after such termination are not reinstated for
the balance of the then remaining terms thereof on the same terms and
conditions, the Operator or the Lessee shall be entitled to terminate this
Agreement upon thirty (30) days prior written notice to Gateway. In the event
Gateway fails to pay any Real and Personal Property Taxes when the same shall be
due and payable, the Operator or the Lessee shall have the right, but shall have
no obligation, to pay the same or any of them and upon such payment by the
Operator or the Lessee, Gateway shall, immediately after proof of such payment
shall have been submitted to Gateway by the Operator or the Lessee and on demand
therefor, pay the Operator or the Lessee the amount of any such payment so made
by the Operator or the Lessee, with interest thereon at the Interest Rate.
ARTICLE VIII
------------
CONCESSIONS
In accordance with the Management Agreement, the Operator, or its
designated concessionaire, has the exclusive right to control all concessions
sold at the Baseball Facility. Gateway acknowledges that the sale of Concessions
in the Common Areas during events at the Baseball Facility would have an adverse
impact on the sale of concessions at the Baseball Facility. Therefore, the
Operator, or its designated concessionaire, shall have the sole and exclusive
right to sell Concessions on the CMS Site during an Event Period, and, in the
event the Operator utilizes the Common Area for such purposes, the Operator
shall cause the Common Areas so utilized to be cleaned to the same condition
existing immediately preceding such use. Gateway shall not permit the sale of
Concessions in the Common Area during an Event Period. The Operator, or its
designated concessionaire, shall have the sole and exclusive right to sell
Baseball Concessions on the CMS Site and Gateway shall not otherwise permit the
sale of any Baseball Concessions on the CMS Site at any time.
ARTICLE IX
----------
PARKING
9.1 DESIGNATED PARKING AREAS. The Site and On-Site Parking Requirements
refers to alternative parking plans for the
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location and size of all garage and surface parking areas on the CMS Site
presently contemplated by the parties. Changes in the composition, size or
location of any parking areas on the CMS Site shall require the prior written
approval of the Operator and the Lessee.
9.2 ON-SITE PARKING. Gateway shall construct, on or before the
Completion Date within, the alternative designated areas as more fully
described in the Site and On-Site Parking Requirements, not less than one
thousand five hundred (1,500) parking spaces (the "On-Site Parking"). The
Operator and the Lessee shall have the exclusive use of the On-Site Parking,
without charge, for all events held at the Baseball Facility. In addition, the
Operator and the Lessee shall have the exclusive use of two hundred fifty (250)
spaces, selected by the Operator and the Lessee in the On-Site Parking, without
charge, at all times. Gateway shall also provide free adequate parking for the
part-time employees of the Operator and the Lessee, but such parking may be more
distant from the Ballpark than that provided to the full-time employees;
provided, however, that in the event the 250 spaces referred to above exceed the
number of spaces used by the Lessee and the Operator for their full-time
employees and Team personnel, the Lessee and the Operator shall first make such
excess spaces available to the part-time employees prior to requesting
additional spaces for any part-time employees. The Lessee shall have the option
to manage and operate the On-Site Parking as set forth in the Lease Agreement.
9.3 ADDITIONAL PARKING. In addition to the On-Site Parking, Gateway
shall use its best efforts to secure, on or before the Completion Date, the
availability of an additional seven thousand (7,000) to ten thousand (10,000)
parking spaces within a two thousand (2,000) foot radius of the Baseball
Facility, using the approximate proposed location of second base as the point of
beginning for such calculation (the "Additional Parking").
9.4 LESSEE'S PARKING REVENUE. Gateway shall be obligated to pay the
Lessee "Lessee's Parking Revenue" as provided for in the Lease Agreement.
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ARTICLE X
---------
COMMON AREA NET REVENUE SHARING
10.1 PAYMENT OF NET REVENUES. Gateway shall pay to the Lessee each year
an amount equal to fifty percent (50%) of Common Area Net Revenue. Common Area
Net Revenue shall be payable on or before February 15 following the end of each
year for which such payments are due. Notwithstanding the preceding, in the
event the Arena is constructed and there is an obligation to share Common Area
Net Revenue with an operator or lessee of the Arena, the Lessee's share of
Common Area Net Revenue shall be diluted equally with Gateway's share, but in no
event shall the Lessee's share of such Common Area Net Revenue be less than
thirty-three and one-third percent (33-1/3%).
10.2 AUDIT. Payments of Lessee's Parking Revenue and Common Area Net
Revenue shall be accompanied by a statement, certified as true and correct by
Gateway's Chief Financial officer, showing with reasonable specificity all
computations relating thereto. For a period of ninety (90) days after delivery
by the Chief Financial Officer of Gateway to the Lessee of the certificate on
which such computation is based, the Lessee shall have the right, through the
use of an independent certified public accounting firm selected by the Lessee,
at any time during normal business hours and at the offices of Gateway, to
review, at the Lessee's expense, all books and records of Gateway which relate
solely to computations of Lessee's Parking Revenue and Common Area Net Revenue.
In the event such review results in a determination that the computations are
erroneous, the error shall be promptly corrected, and if such review discloses
an error of a three and one-half percent (3.5%) or more discrepancy in favor of
the Lessee, the expense of such review shall be reimbursed to the Lessee by
Gateway.
ARTICLE XI
----------
MISCELLANEOUS
11.1 NO AMENDMENT OF BASEBALL FACILITY AGREEMENTS. The rights and
obligations of the parties under this Agreement shall not affect the rights and
obligations of Gateway, the Lessee and the Operator under the Baseball Facility
Agreements.
11.2 NOTICES. Any notice (including, without limitation, demands,
notices of consent or nonconsent, approval or disapproval, statements, requests,
and invoices), election or other communication (hereinafter "Notices") which
any party shall desire or, be required to give pursuant to the provisions of
this Agreement shall be in writing, signed by the party or officer, agent or
attorney of the party giving the notice and shall be sent by
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registered or certified mail, return receipt requested. The giving of Notices
shall be deemed effective upon delivery if served personally, or upon the third
business day from and including the day of posting, if deposited with the United
States Postal Service with postage charges prepaid, enclosed in a securely
sealed, properly addressed envelope as follows:
For Gateway:
Gateway Economic Development
Corporation of Greater Cleveland
000 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Executive Director
With a copy to:
Climaco, Climaco, Seminatore, Xxxxxxxxx &
Xxxxxxxx Co. L.P.A.
Xxx Xxxxx Xxxxxxxx, Xxxxx 000
0000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
With a copy to:
Xxxxxx, Halter & Xxxxxxxx
0000 Xxxxxxx Xxxxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
For the Lessee:
Cleveland Indians Baseball
Company Limited Partnership
Xxxxxxxxx Xxxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: General Manager
With a copy to:
Xxxxxxx X. Xxxxxx
00000 Xxxxxx Xxxxx Xxxx
Xxxxxxxxx, Xxxx 00000
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With a copy to:
Xxxxx & Xxxxxxxxx
0000 Xxxxxxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
For the Operator:
Ballpark Management Company
Xxxxxxxxx Xxxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: General Manager
With a copy to:
Xxxxxxx X. Xxxxxx
00000 Xxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxx 00000
With a copy to:
Xxxxx & Xxxxxxxxx
0000 Xxxxxxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Notwithstanding the foregoing, however, notice shall also be deemed
complete two (2) business days after Notice has been delivered to a commercial
overnight delivery service, charges prepaid and enclosed in a securely sealed
envelope addressed as described above, provided that a follow up of such Notice
is sent by registered or certified mail as described above within twenty-four
(24) hours thereafter. Any party may change the address to which Notices are to
be directed pursuant to this Section 11.2 by providing written Notice, in a
manner herein provided, of such change of address to the other parties hereto.
11.3 COVENANTS RUNNING WITH THE LAND. The covenants and agreements set
forth in this Agreement are intended to be and shall be construed as covenants
running with the land comprising the CMS Site, both as to the benefits and
burdens thereof and shall be binding upon, inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and assigns
in the ownership of the Baseball Facility, the Common Areas or interests
therein; provided, however, that this Section is subject to the provisions of
Section 2.6 hereof.
11.4 BREACH SHALL NOT PERMIT TERMINATION. It is expressly agreed that
no breach of this Agreement shall entitle any party to cancel, rescind or
otherwise terminate this Agreement, but
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such limitation shall not affect in any manner any other right or remedies which
the parties may have hereunder or by law by reason of any breach of this
Agreement.
11.5 ESTOPPEL CERTIFICATES. At any time and from time to time, the
Lessee agrees, upon request in writing from Gateway, to execute and deliver to
Gateway or to Gateway's lender holding or proposing to hold a mortgage on the
CMS Site, not later than thirty (30) days after receipt of such request, a
statement in writing certifying to all or any part of the following information
as may be requested: that this Agreement is unmodified and in full force and
effect (or if there have been modifications, that the same is in full force and
effect as modified and stating the modifications) and that to the best
information and belief of the Lessee or the Operator, there is no default under
this Agreement by Gateway or, if there is a default, the nature thereof.
11.6 TERMS. Unless the context clearly requires otherwise, the singular
includes the plural, and vice versa, and the masculine, feminine and neuter
adjectives and pronouns include one another.
11.7 NO JOINT VENTURE. Nothing contained in this Agreement shall be
construed to make the parties partners or joint venturers or to render any party
liable for the debts or obligations of any other party, except as expressly
provided in this Agreement.
11.8 HEADINGS. The Article, Section and Subsection headings herein are
for convenience and reference only, and in no way define or limit the scope and
content of this Agreement or in any way affect its provisions.
11.9 AGREEMENT CONTAINS ALL TERMS. All of the representations,
agreements, understandings and obligations of the parties are contained herein
and in the Exhibits attached hereto.
11.10 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Ohio.
11.11 CROSS REFERENCES. Any reference in this Agreement to a Section,
Subsection, Article or Exhibit is a reference to a Section, Subsection, Article
or Exhibit, as appropriate, of this Agreement, unless otherwise expressly
indicated.
11.12 FORCE MAJEURE. Except as otherwise herein expressly provided, if
either party shall be delayed or hindered in or prevented from the performance
of any covenant or obligation hereunder, other than for the payment of money, as
a result of any Force Majeure and, provided, that the party delayed, hindered or
prevented from performing notifies the other party not later than ten (10)
Business Days after a Reporting Period of any such delay,
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hindrance or prevention occurring during the Reporting Period at issue, then the
performance of such covenant or obligation, other than one for the payment of
money, shall be excused for the period of the impact of such delay, hindrance or
prevention and the period for the performance of such covenant or obligation
shall be extended by the number of days equivalent to the number of days of such
delay, hindrance or prevention. Failure to so provide the Reporting Period
notice as to a delay commencing during the Reporting Period at issue will result
in waivers of both excuse in performance and extension of time to perform under
this Section 11.12 with respect to any delay within that Reporting Period.
11.13 AMENDMENT, WAIVER. No alteration, amendment or modification
hereof shall be valid unless executed by an instrument in writing by the parties
hereto with the same formality as this Agreement. The failure of the Lessee, the
Operator or Gateway to insist in any one or more instances upon the strict
performance of any of the covenants, agreements, terms, provisions or conditions
of this Agreement or to exercise any election herein contained shall not be
construed as a waiver or relinquishment for the future of such covenant,
agreement, term, provision, condition, election or option, but the same shall
continue and remain in full force and effect. No waiver by the Lessee,
the Operator or Gateway of any covenant, agreement, term, provision or condition
of this Agreement shall be deemed to have been made unless expressed in writing
and signed by an appropriate official on behalf of Gateway or the Lessee or the
Operator. The payment by either party of sums due and payable hereunder, with
knowledge of the breach of any covenant, agreement, term, provisions or
condition herein maintained, shall not be deemed as a waiver of such breach.
11.14 CONSENT. Unless otherwise specifically provided herein, no
consent or approval by the Lessee, the Operator or Gateway permitted or required
under the terms of this Agreement shall be valid or be of any validity
whatsoever unless the same shall be in writing, signed by the party by or on
whose behalf such consent is given.
11.15 SEVERABILITY. If any Article, Section, Subsection, term or
provision of this Agreement or the application thereof to any party or
circumstance shall, to any extent, be invalid or unenforceable, the remainder of
the Article, Section, subsection, term or provision of this Agreement or the
application of same to parties or circumstances other than those to which it is
held invalid or unenforceable shall not be affected thereby and each remaining
Article, Section, Subsection, term or provision of this Agreement shall be valid
and enforceable to the fullest extent permitted by law.
11.16 ACCORD AND SATISFACTION. Payment by any party, or receipt or
acceptance by a receiving party, of any payment due hereunder in an amount less
than the amount required to be paid
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hereunder shall not be deemed an accord and satisfaction, or a waiver by the
receiving party of its right to receive and recover the full amount of such
payment due hereunder, notwithstanding any statement to the contrary on any
check or payment or on any letter accompanying such check or payment. The
receiving party may accept such check or payment without prejudice to the
receiving party's right to recover the balance of such payment due hereunder or
to pursue any other legal or equitable remedy provided in this Agreement.
11.17 FURTHER ASSURANCES. The parties shall execute, acknowledge and
deliver, after the date hereof, without additional consideration, such further
assurances, instruments and documents, and shall take such further actions, as
any party shall reasonably request of the other in order to fulfill the intent
of this Agreement and the transactions contemplated hereby.
11.18 NO THIRD PARTY BENEFICIARY. The provision of this Agreement are
for the exclusive benefit of the parties hereto and not for the benefit of any
third person, nor shall this Agreement be deemed to have conferred any rights,
express or implied, upon any third person.
11.19 CONFORMING AMENDMENTS. The parties acknowledge that this
Agreement will be amended to conform to any approved Financing Arrangements
entered into from and after the date of this Agreement with the Bank, which
amendments shall be subject to the approval of the parties hereto, which
approval shall not be unreasonably withheld.
11.20 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
11.21 TERM. The term of this Agreement shall be for the Term.
ARTICLE XII
-----------
THREE PARTY AGREEMENT AND
CENTRAL MARKET COMMUNITY DEVELOPMENT PLAN
Gateway shall not approve any amendment to the Three Party Agreement as
provided in Section 5.05 thereof or the Central Market Community Development
Plan as provided in Section III.D. thereof without the prior written consent of
the Lessee and the Operator, which consent may be withheld in the Lessee's and
the Operator's sole discretion if such amendment would affect Lessee's or the
Operator's rights provided for in this Agreement, the Lease Agreement, the
Management Agreement or the Ground Lease.
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ARTICLE XIII
------------
LEAGUE APPROVAL
This Agreement shall be null and void, and of no further force or
effect, if within sixty (60) days after execution by Gateway, the Lessee and the
Operator, this Agreement has not been approved by the Commissioner of Baseball
and the President of the American League. After execution hereof by Gateway, the
Lessee and the Operator, the Lessee and the Operator shall immediately request
such approval.
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IN WITNESS WHEREOF, Gateway, the Lessee and the Operator hereto have
caused this Agreement to be executed and delivered as of the day and year first
above written.
Witness as to Gateway: GATEWAY ECONOMIC DEVELOPMENT
CORPORATION OF GREATER CLEVELAND,
an Ohio nonprofit corporation
/s/ illegible By: /s/ Xxx Xxxxxx
-------------------------------- --------------------------------------
/s/ illegible Its: Chairman
-------------------------------- -------------------------------------
Witness as to Lessee: CLEVELAND INDIANS BASEBALL COMPANY
an Ohio Limited partnership
By: Cleveland Baseball Corporation,
an Ohio corporation, its sole
general partner
/s/ illegible By: /s/ Xxxxxx X. Xxxxxx
-------------------------------- --------------------------------------
Xxxxxx X. Xxxxxx
/s/ illegible Its: Vice President
--------------------------------
Witness as to Operator: BALLPARK MANAGEMENT COMPANY, an Ohio
corporation
/s/ illegible By: /s/ Xxxx X. Xxxxxxxx
-------------------------------- --------------------------------------
Xxxx X. Xxxxxxxx
/s/ illegible Its: Secretary
--------------------------------
