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EXHIBIT 10.3
DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT ("Agreement") is made and entered into this
17 day of June, 1988, by and between the TRANSPORTATION CABINET, OF THE
COMMONWEALTH OF KENTUCKY ("Transportation Cabinet") and JAMESTOWN RESORT &
MARINA, LTD. a Kentucky limited partnership ("Partnership") acting by and
through Jamestown Resort and Marina, Inc., a Kentucky corporation, its general
partner.
R E C I T A L S:
A. WHEREAS, the United States Government is the owner of that
certain tract of land and body of water located in Xxxxxxx County, Kentucky,
consisting of 287.45 acres, more or less, which is presently leased to the
Partnership for a remaining term concluding on December 31, 2012, (the 287.45
acres being more particularly described on Exhibit "A" attached hereto and
incorporated herein and referred to herein as the "Partnership Premises"), but
deleting therefrom those portions of land and water defined hereinbelow as the
Commonwealth Premises; and
B. WHEREAS, the Partnership presently operates certain resort and
marina facilities upon the Partnership Premises, and, contingent upon the
construction of certain improvements by the Commonwealth as hereinafter
described, the Partnership has committed to invest in excess of $5.5 million
thereon including the substantial rehabilitation of the existing resort,
restaurant and lodging facilities, the substantial addition to the existing
campground and "RV" areas, the replacement of the existing marina facilities
with new "World Class" marina facilities, the addition of a substantial number
of new boats to the marina rental fleet, and the addition of other substantial
improvements and facilities, all for the purpose of providing to the general
public, including the citizens of the Commonwealth of Kentucky and of other
states, modern and first class resort and marina facilities; and
C. WHEREAS, the development of the marina facilities will benefit
the citizens of the Commonwealth of Kentucky and of other states and will
attract tourists to this area of the Commonwealth because of its natural scenic
beauty and attractiveness, and the recreational and vacation opportunities and
facilities available in the area; and
D. WHEREAS, in order to accomplish the public purposes described
in the preceding paragraph, it is necessary and appropriate for the
Transportation Cabinet to construct an extension of Kentucky Highway 92 to the
island across a new causeway and to construct a roadside park on the island
(such new highway and roadside park referred to herein as the "Public
Improvements"). The Public Improvements shall be constructed and maintained
upon that property more specifically described on Exhibit "B" attached hereto
and incorporated herein (referred to herein as the "Commonwealth Premises")
pursuant to an agreement between the Corps of Engineers and the Transportation
Cabinet; and
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E. WHEREAS, the construction of the Public Improvements, the
maintenance and operation of the Public Improvements as part of the State
highway system, and the construction, development, maintenance and operation of
the Partnership's new resort and marina improvements and facilities will
constitute an investment in excess of $7 million, will create a substantial
number of construction and permanent jobs, will add public transportation
facilities to the highway system of the Commonwealth of Kentucky, will result
in a substantial increase in tourists and tourism revenues in this area of the
Commonwealth, will result in substantial additional tax revenues to the County
of Xxxxxxx and the Commonwealth of Kentucky, and will in other ways greatly
benefit the citizens of the commonwealth of Kentucky; and
F. WHEREAS, as an inducement to the Partnership to make its
investment in modern resort and marina facilities on the Partnership Premises,
the Transportation Cabinet agrees to enter into this Agreement and other
agreements described herein to accomplish the purposes set forth herein, all on
the terms and conditions as set forth hereinafter;
NOW, THEREFORE, it is agreed and understood by and among the
Transportation Cabinet and the Partnership, for good and valuable
consideration, including the promises, covenants and agreements of the parties
hereinafter set forth, as follows:
1. Corps of Engineers - Partnership Lease. It is acknowledged
between the parties hereto that the Corps of Engineers and the Partnership have
entered into a Lease for the Partnership Premises (excluding the Commonwealth
Premises) for a term concluding December 31, 2012 upon such rental and other
terms and conditions as provided in such lease, which lease allows the
development of the Partnership Premises for the purposes described herein and
such other purposes as set forth in such lease.
2. Corps of Engineers - Transportation Cabinet Agreement. It is
acknowledged between the parties hereto that the Corps of Engineers and the
Transportation Cabinet have tentatively agreed, subject to the execution of
this Agreement, to execute a right-of-way agreement granting the Transportation
Cabinet over and across the Commonwealth Premises a perpetual public
right-of-way on which will be constructed the Public Improvements upon such
terms and conditions as shall be agreed upon between such parties, which
agreement shall allow the construction and maintenance thereon of the Public
Improvements.
3. Partnership Construction/Development Obligations and Payments.
In consideration of the construction of the Public Improvements by the
Transportation Cabinet, the Partnership agrees (i) to invest not less than $5.5
million for the rehabilitation of existing resort and marina facilities and the
construction of new resort and marina facilities as more generally described in
the Recitals hereinabove on the Partnership Premises coincidental with the
construction of the Public Improvements, and, (ii) commencing on the date the
Public Improvements are opened for use by the public to pay to the
Transportation Cabinet one-half of one percent of the gross revenues ("Gross
Revenues"), as defined herein, received by the Partnership from the marina
facilities ("Marina Facilities"), as defined below, payable during the
remaining term of this Agreement on the 20th day of each month based upon Gross
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Revenues received during the preceding calendar month. For purposes of this
paragraph the term "Gross Revenues" shall mean revenues derived from (i) sales
of gasoline, food, merchandise, and all other tangible products from the Marina
Facilities, (ii) rental of marina slips, boats, equipment, lockers, and other
tangible items located on the Marina Facilities, and (iii) repair, maintenance,
and other services of boats, equipment, or other items from the Marina
Facilities, but excluding from all such Gross Revenues sales and any other like
taxes, discounts, refunds, and other like credits. Further, the Partnership
shall be entitled to deduct from each monthly payment the amount of the
Maintenance and Utility Expenses (as defined in Paragraph 7) incurred by the
Partnership for the preceding month. For purposes of this paragraph, the term
"Marina Facilities" shall mean those marina improvements located upon the body
of water that is a part of the Partnership Premises, but excluding therefrom
all revenues derived from any activities located upon the land which is a
portion of the Partnership Premises.
4. Transportation Cabinet and Partnership Construction
Obligations and Payments. The Transportation Cabinet agrees to let construction
contracts for the Public Improvements in substantial accordance with the general
concept plans therefore as more specifically described on Exhibit "C", attached
hereto and incorporated herein, and in accordance with the detailed plans and
specifications therefor which shall be subject to the prior approval of the
Transportation Cabinet and the Corps of Engineers. The commencement of
construction of the Public Improvements shall occur as soon as possible after
securing all necessary governmental approvals and permits therefore and shall be
completed within one year from the date of commencement of construction, subject
to delays beyond the control of the Transportation Cabinet. It is understood
that the maximum obligation of the Transportation Cabinet shall be the sum of
$1,979,000 for construction costs, design and engineering fees, utility
relocation costs and other related costs. The Partnership agrees to pay the
balance of all costs incurred in excess of $1,979,000. In the event the initial
construction contract of the Transportation Cabinet exceeds the maximum
obligation of the Transportation Cabinet, the Partnership agrees to pay to the
Cabinet the amount of excess costs prior to awarding the contract. Prior to
executing the initial construction contract, the Partnership has the option of
refusing to participate in the contract and in such event, the Partnership shall
reimburse the Transportation Cabinet for all costs up to that time and the
agreement shall be rescinded. The Transportation Cabinet agrees to pay design
and engineering fees directly related to construction of the roadway and
roadside park from the date of this Agreement and also design and engineering
fees incurred within the period of time commencing thirty (30) days prior to the
date of the Agreement. The Public Improvements shall consist of the
construction of the causeway and roadside park and other appropriate and related
facilities in conjunction with the causeway and roadside park which shall
include appropriate lighting, drainage facilities, utility relocating, signage,
guardrail, paving of the roadway and roadside park and other appropriate and
related items.
5. Utilities; Utilities and Access Easements. The Transportation
Cabinet shall grant to the Partnership a permit under, on, over and across the
Commonwealth Premises for the construction, maintenance, repair and replacement
of utility facilities and access improvements for the use and benefit of the
Partnership's resort and marina facilities adjacent to the Commonwealth
Premises. The construction, maintenance, repair and replacement of utilities
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and access improvements that are for the use of the Partnership's resort and
marina facilities shall be at the expense of the Partnership.
6. Approvals, Licenses and Permits. It is the intent and desire
of the parties that all of the construction and improvements described herein
shall be accomplished in accordance with all applicable local, state and
federal rules, regulations, and laws. It shall be the responsibility of the
party obligated herein to perform such specific work to obtain all necessary
approvals, licenses and permits therefore. Further, each of the parties hereto
agrees to cooperate with the other parties herein, including joining as an
applicant in any application, to obtain the necessary approvals, licenses or
permits. Notwithstanding the foregoing, no provision of this Agreement shall
in any manner obligate, or be construed to so obligate, the Transportation
Cabinet, or any other local, state or federal entity, to perform any obligation
described herein or to issue any such approval, license or permit except as it
otherwise would in accordance with all of its applicable rules, regulations and
laws, upon the full and proper satisfaction of all requirements therefor, and
in the total and sole discretion of such entity in all circumstances wherein
such entity shall have such discretion. For purposes of the Agreement,
provisions of the Kentucky Standard Specifications for Road and Bridge
Construction, Edition of 1988, are incorporated by reference.
7. Maintenance, Repairs, Etc. of the Public Improvements. The
Transportation Cabinet at its expense shall be responsible for the maintenance,
repair and replacement of all of the Public Improvements with the exception
that the Partnership agrees to maintain at its expense the roadside park by
keeping the roadside park free of trash and debris, maintaining the landscaping
thereon, and the enactment and enforcement of reasonable rules and regulations
for the use thereof by the public. The Partnership agrees to maintain at its
expense all light fixtures and to pay all lighting utility bills. The roadside
park shall be available to the public at all times and no fees shall be charged
for the use of the roadside park by the public.
8. Term of Agreement. The Term of this Agreement shall be
coincidental with the term and all renewals and extensions thereof of the lease
agreement between the Corps of Engineers and the Partnership for the
Partnership Premises, but in no event shall extend beyond the term of the
agreement and all renewals and extensions thereof between the Corps of
Engineers and the Transportation Cabinet for the Commonwealth Premises.
9. Assignment. Upon the assignment by the Partnership of its
leasehold interest in the Partnership Premises, the Partnership may assign all
of its rights and interests under this Agreement to such assignee upon the
written agreement of the said assignee to accept such assignment and to perform
all of the obligations and responsibilities of the Partnership as provided in
this Agreement. Such assignment shall be binding upon the Transportation
Cabinet upon being furnished a written copy of such assignment executed by the
Partnership and by the assignee. Such assignment shall not relieve the
Partnership of its obligations and responsibilities to the Transportation
Cabinet under this Agreement.
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10. Contingencies and Good Faith Efforts. The performance by the
respective parties hereto of their obligations as set forth in this Agreement
shall be contingent upon (i) the execution of an agreement between the Corps of
Engineers and the Transportation Cabinet described in Paragraph 2 herein above,
and (ii) the issuance of all applicable and necessary approvals, licenses and
permits for the construction, development and operation of the Public
Improvements described herein. This Agreement is intended to outline the
general approach and terms agreed to by and between the parties hereto, and as
an inducement to the Partnership to proceed with its investment in the resort
and marina facilities, and with the full knowledge and understanding that final
details of each of the provisions of this Agreement shall be approached,
resolved and reduced to writing by the parties through their good faith efforts
and to the best interest and benefit of each of them, and the public, as the
particular provisions and obligations dictate, and within the scope of the
legal authority of the Corps of Engineers and the Transportation Cabinet. The
parties agree to proceed with good faith efforts to seek such approvals,
licenses and permits as necessary to comply with or evidence compliance with
all applicable local, State and federal rules, regulations and laws applicable
to this Agreement for the purposes to be accomplished herein and to exert their
good faith efforts to bring about the financing and completion of the public
and private improvements and facilities described herein in compliance with all
applicable local, State and federal rules, regulations and laws.
11. Hold Harmless. The Partnership agrees to hold the
Transportation Cabinet harmless for any and all claims and causes of action
arising out of the Partnership's failure to perform any of its duties and
responsibilities set forth in this Agreement.
12. Legal Effect. If any clause or provision of this Agreement
shall become illegal, invalid, or unenforceable under present or future laws,
the remainder of this Agreement shall not be affected thereby. All terms and
provisions of this Agreement shall be construed to give effect to this
Agreement to the greatest extent permitted by applicable law. It is the
intention of the parties hereto that in lieu of any clause of provision in this
Agreement which shall be illegal, invalid, or unenforceable, there shall be
added as a part of this Agreement a clause or provision as similar in terms to
such illegal, invalid, or unenforceable clause or provision as may be legally
enforceable in order to give the fullest possible effect to the intentions of
the parties hereto.
13. Cancellation. The Partnership agrees that the Transportation
Cabinet shall have the right at any time, in its sole discretion and without
liability or penalty, to cancel and terminate this agreement by transmitting to
the Partnership written notice of such cancellation and termination.
14. Notices. When any party to this Agreement desires to give
notice to other parties, such notices shall be given by certified or registered
mail, return receipt requested. The notice shall be sufficient if given and
addressed to the respective parties at the following addresses or at such other
addresses as any party may notify the other parties in writing of from time to
time.
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If to Transportation Cabinet: Transportation Cabinet
Attention: Secretary
Xxxxxxxxx, XX 00000
If to Partnership: Jamestown Resort and Marina, Inc.
c/o the Xxxx Companies
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Mr. R. Xxxxxx Xxxx
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day, month and year first above written.
"Transportation Cabinet"
TRANSPORTATION CABINET OF THE
COMMONWEALTH OF KENTUCKY
BY: /s/
---------------------------------
Secretary
"Partnership"
JAMESTOWN RESORT AND MARINA, LTD.
a Kentucky limited partnership
By: Jamestown Resort and Marina
Inc., a Kentucky corporation
Its General Partner
By: /s/
---------------------------------
Chairman
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AMENDED DEVELOPMENT AGREEMENT
Substituted Agreement made August 1, 1988 between the Transportation
Cabinet of the Commonwealth of Kentucky, referred to as "Transportation
Cabinet" and Jamestown Resort and Marina, Ltd., a Kentucky limited partnership
acting by and through Jamestown Resort and Marina, Inc., a Kentucky
corporation, its general partner of 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx
referred to as "Partnership."
R E C I T A L S:
A. On June 17, 1988, the parties entered into a development
agreement at the Xxxxx Xxxxxx Xxxxxxxx, Xxxxxxxxx, Xxxxxxxx relative to the
public purpose of extending Kentucky Highway 92 in Xxxxxxx County by
construction of a causeway to and roadside park on the public area known as
Jamestown Island as an inducement for private capitalization of a world-class
marina and resort on pubic property.
B. The parties are desirous of modifying the provisions of the
prior contract by this Amended Agreement.
AGREEMENT
The prior contract of the parties is modified, altered and changed in
the following respects only:
ELIMINATIONS AND INSERTIONS
By eliminating and striking out from the agreement of June 17, 1988
all of Paragraph 3 on pages 2 and 3, Paragraph 4 on pages 3 and 4, and
Paragraph 7 on page 4, and inserting in their place the following paragraphs:
3. Partnership Construction/Development Obligations and Payments.
In consideration of the construction of the Public Improvements by the
Transportation Cabinet, the Partnership agrees (i) to invest not less than $5.5
million for the rehabilitation of existing resort and marina facilities and the
construction of new resort and marina facilities as more generally described in
the Recitals hereinabove on the Partnership Premises coincidental with the
construction of the Public Improvements, and, (ii) commencing on the date the
Public Improvements are opened for use by the public to pay to the
Transportation Cabinet one percent of the gross revenues ("Gross Revenues"), as
defined herein, received by the Partnership from the marina facilities ("Marina
Facilities"), as defined below, payable during the remaining term of this
Agreement on the 20th day of each month based upon Gross Revenues received
during the preceding calendar month. For purposes of this paragraph the term
"Gross Revenues" shall mean revenues derived from (i) sales of gasoline, food,
merchandise, and all other tangible products from the Marina Facilities, (ii)
rental of rooms, cabins, marina slips, boats, equipment, lockers, and other
tangible items located on the Marina Facilities, and (iii) repair, maintenance,
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and other services of boats, equipment, or other items from the Marina
Facilities, but excluding from all such Gross Revenues sales and any other like
taxes, discounts, refunds, and other like credits.
4. Transportation Cabinet and Partnership Construction
Obligations and Payments. The Transportation Cabinet agrees to let
construction contracts for the Public Improvements in substantial accordance
with the general concept plans therefore as more specifically described on
Exhibit "C", attached hereto and incorporated herein, and in accordance with
the detailed plans and specifications therefor which shall be subject to the
prior approval of the Transportation Cabinet and the Corps of Engineers. The
commencement of construction of the Public Improvements shall occur as soon as
possible after securing all necessary governmental approvals and permits
therefore and shall be completed within one year from the date of commencement
of construction, subject to delays beyond the control of the Transportation
Cabinet. It is understood that the maximum obligation of the Transportation
Cabinet shall be the sum of $1,979,000 for construction costs, design and
engineering fees, utility relocation costs and other related costs. The
Partnership agrees to pay the balance of all costs incurred in excess of
$1,979,000. In the event the initial construction contract of the
Transportation Cabinet exceeds the maximum obligation of the Transportation
Cabinet, the Partnership agrees to pay to the Cabinet the amount of excess
costs prior to awarding the contract. Prior to executing the initial
construction contract, the Partnership has the option of refusing to
participate in the contract and in such event, the Partnership shall reimburse
the Transportation Cabinet for all costs up to that time and the agreement
shall be rescinded. The Transportation Cabinet agrees to pay design and
engineering fees directly related to construction of the roadway and roadside
park. The Transportation Cabinet agrees to pay for design and engineering fees
incurred within the period of time commencing thirty (30) days prior to the
date of the agreement up to a maximum of $100,000, any balance of which shall
be applied to engineering costs that may be necessary until the construction
project begins. The Public Improvements shall consist of the construction of
the causeway and roadside park and other appropriate and related facilities in
conjunction with the causeway and roadside park which shall include appropriate
lighting, drainage facilities, utility relocating, signage, guardrail, paving
of the roadway and roadside park and other appropriate and related items.
7. Maintenance, Repairs, Etc. of the Public Improvements. The
Transportation Cabinet at its expense shall be responsible for the maintenance,
repair and replacement of all of the Public Improvements with the Partnership
agreeing to maintain the roadside park by keeping the roadside park free of
trash and debris, maintaining the landscaping thereon, and the enactment and
enforcement of reasonable rules and regulations for the use thereof by the
public and the customers of the marina. The Partnership agrees to likewise
monitor the improvements and to pay all lighting utility bills relating to the
Public Improvements. Disputes regarding maintenance responsibilities shall be
the subjects of negotiations between the Transportation Cabinet and the
Partnership. In the event these disputes cannot be resolved, the Secretary of
Transportation's determination shall be final. The roadside park shall be
available to the public at all times and no fees shall be charged for the use
of the roadside park by the public.
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IN WITNESS WHEREOF, the parties have executed this amended development
agreement at Frankfort, Kentucky, the day and year first above written.
"Transportation Cabinet"
TRANSPORTATION CABINET OF THE
COMMONWEALTH OF KENTUCKY
BY: /s/
------------------------------------
Secretary
"Partnership"
JAMESTOWN RESORT AND MARINA, LTD.
a Kentucky limited partnership
BY: Jamestown Resort and Marina, Inc.,
a Kentucky corporation Is
General Partner
BY: /s/
------------------------------------
Chairman
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