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Home My WebLink About1998-08-10 - Agendas - Final • MEETING NOTICE The Advertising and Promotion Commission will meet on Monday, August 10, 1998, at 2:00 p.m. at City Hall in City Council Chambers. ADVERTISING AND PROMOTION COMMISSION August 10, 1998 2 :00 p.m. City Hall Council Chambers I Call to Order II. Reports A. Approval of Minutes for July 13 B. Financial — Ben Mayes C. Convention and Visitor Activity D. Blackwood/Martin/CJRW Report — Susan Stirewalt III. Old Business A. Town Center Subcommittee Report 1 . Lease with City 2. Bond Resolution IV. New Business V. Adjourn • Informational Items — Summary of Governor's Conference on Tourism research results Trolley Operations Report • GROUP: ADVERTISING & PROMOTION COMMISSION DATE: July 13, 1998 PRESENT: Fred Hanna, Alex Jerde, Carl Maguire, Curtis Shipley, Jim Waselues, Kit Williams, and Marilyn Snapp ABSENT: Joe Fennel The regular meeting of the Advertising and Promotion Commission was called to order at the City Hall Council Chambers at 2:00 p.m. by Chairman Joe Fennel. MINUTES It was moved by Williams, second by Shipley to approve the minutes of the June 8 meeting. Motion carried. FINANCIAL REPORT Ben Mayes presented financial report for June. HMR collections were $98,318, an increase of 16.47% over June, 1997 collections. This represents the largest collection month in the history of the tax. Year to date collections are $531 ,962, a 10.05% increase over 1997. June expenditures were $27,864. CONVENTION AND VISITOR DEVELOPMENT REPORT • Marilyn Snapp presented the Convention Visitor Development report. The Newcomer's Trolley trial had a successful second month run with 19 participants. Where to Retire magazine will feature Fayetteville in a fall issue. Bus tour operators are seeking fall locations for travel. ADVERTISING AGENCY REPORT Susan Stirewalt discussed the Internet and its effect on responses. A press release for the packaging tours was sent to Arkansas newspapers and other targeted publications outside the state. The 4-color brochure received an Award of Excellence from the American Economic Development Council, and the Loud/Soft ad received an Honorable Mention. A survey of the business traveler is being developed. OLD BUSINESS Town Center Update Commission asked that leases from other cities (Little Rock, Pine Bluff, and Ft. Smith) be acquired so that they might compare with City and A & P lease for management. Commission questioned Ben Mayes regarding insurance, maintenance, and employee benefit packages. . Funding Requests Funding requests were discussed. Moved by Shipley, second by Jerde to fund sub-committee recommendations as follows: Aututnnfest - $2,500 Gary Hampton Memorial National Invitational Tournament - $500 Botanical Garden Society of the Ozarks — none • First Night - $72000 AAA American Legion Tournament - $2,000 Holiday Hoops - $ 12,000 • 1998 Wood Bat Classic - $ 1 ,984.99 Motion carried. NEW BUSINESS U of A Indoor Track facility Shipley requested that we explore with the U of A the track facility which could be used as exhibition hall. He requested that a subcommittee look into the 150,000 sq. It facility because of the limited use for indoor track. Joe Fennel will appoint subcommittee. Bond Resolution Ben Mayes distributed the bond resolution/ordinance to be adopted by the Commission and forwarded to City Council. Contract Authorization Moved by Shipley, second by Jerde to authorize Wittenberg, Delony Davidson to proceed with contract for up to 30% of the work concentrating on large scale development preparation. Motion carried. There being no further business, the meeting was adjourned. Respectfully submitted, • Marilyn Snapp Director Convention and Visitor Development • City of Fayetteville, Arkansas Monthly HMR Tax Collections 1996-1998 • 1996 1997 1997 1998 1998 Total Total Change Over Total Change Over HMR Taxes HMR Taxes Prior Year HMR Taxes Prior Year January $ 76,738 $ 73,809 -3. 82% $ 82, 157 11 . 31 % February 68, 507 731099 6.70% 83,759 14.58% March 721521 76,808 5.91 % 80,815 5.22% April 82, 155 881050 7. 17% 89,603 1 .76% May 78,771 87,221 10.73% 97,309 11 . 57% June 79,880 84,417 5.68% 98,318 16.47% July 83,337 793784 -4.26% 94,621 18.60% August 78,651 84,099 6.93% 0 September 85,514 82,984 -2.96% 0 October 80,031 952030 18. 74% 0 November 89,882 88, 147 -1 . 93% 0 December 80, 107 79,492 -0.77% 0 • Total $ 956,093 $ 992,939 3.85% $ 626,583 11 .26% HMR Tax Collections By Month 120 100 so a C 60 0 F 40 20 0 January February March April May June Juty August September October November December O 1996 ® 1997 0 1998 • \HMRTAX Advertising & Promotion Commission Financial Report - Expenditures For the Month Ending July 31 , 1998 0-1 1998 YTD July Budget Item Budget Expenses Remaining Expenses Chamber of Commerce Operations Contract $100,000 $100,000 $0 $253000 Collection Expense - City of Fayetteville 20,500 12,531 71969 11892 Audit Expense 150 150 800 Telephone Number (Chamber of Commerce) 10,000 71500 22500 21500 Public Notification (BMA Contract) 225,000 1129545 112,455 932 Trolley Operations 402000 17,349 22,651 2,391 Convention Support 59000 32809 11191 Town Center/Exhibit Hall 74,351 743351 0 Brochure Development 16,859 952 153907 Air Museum 40,000 30,000 102000 10,000 Square Gardens 213920 143837 73083 2,122 Special Projects AAA American Legion Tournament 23000 21000 •AAAA State Baseball Tournament 21000 25000 0 Ark. State Gymnastics Competition 600 600 Autumnfest 2,000 21000 Fay. Public Library Genealogical Collection 35,522 33,825 1 ,697 First Nite 71000 71000 Gary Hampton Memorial Tournament 500 500 HAWKS AAU Basketball Tournament 29000 25000 0 Holiday Hoops 12,000 12,000 Joe Marlin Memorial Stage Race 2,000 2,000 Univ. of Arkansas Museum 5,724 51724 Wood Bat Classic 11900 11900 TOTAL USES $627,026 $411 .699 $215,327 $44,837 • W&PEXP98 • ACTIVITY REPORT JULY, 1998 INQUIRY RESPONSES July 1998 Tourist - 196 1998 Year to Date — 2,000 July 1997 Tourist - 258 1997 Year to Date — 2, 199 July 1998 Advertising Response — 1,369 1998 Year to Date — 14,532 July 1997 Advertising Response — 1,053 1997 Year to Date — 4908 July 1998 Relocation — 126 1998 Year to Date — 1 , 100 July 1997 Relocation — 183 1997 Year to Date — 1 ,345 July 1998 Total Inquiries — 1 ,691 June 1997 Total Inquiries — 1,494 Year to Date 1998 — 17,632 Year to Date 1997 — 26,452 Internet Inquiries June Hits — 27,327 Hits since Sept 3, 1997 — 333,671 • CONVENTION ACTIVITY Conventions — Fayetteville Babe Ruth Baseball Tournament Good Sams Samboree Jaycees — Reunion Miscellaneous — Newcomer's Fayetteville Friendly Tour Paradise Dive Aquarium — Jason Cantrell Hospitality in a heartbeat classes at Mall, Library, Lifestyles, Dillard's Hot Times in the Ozarks & KCBS cookoff Grteat Passion Play, 30th anniversary House that Jane Built N.Y.S.P. Board of Directors Girl Scout Day Camp — guest speaker Arthritis Foundation, Jingle Bell Run Lights of the Ozarks — Christmas in July Town Center — preliminary construction with City Planning Media Relations - Active Years — Ben Wittenberg Tulsa World — Mary Serabrov Bottom Line Tomorrow - Anna Jemstedt (best places to retire) Better Homes and Gardens - Nancy Ingram (Farmer's Market) Morning News — Curtis Creek • Memphis Ma azg ine — Richard Banks • Top HMR Collections — June Hilton Clarion Red Lobster Chili's Rio Bravo Ryan's A. Q. Applebee's McDonald's 50's Ozark Brewing Company Jose's McDonald's #1363 • • • Tourist Inquiries - 1998 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec TOTAL AL 4 3 4 5 4 7 3 AK 1 AZ 4 4 4 1 3 6 2 AR 43 32 71 31 27 36 23 CA 8 9 30 16 4 10 11 CO 3 4 5 1 1 2 CT 1 1 DE 2 DC 1 FL 5 2 4 9 5 5 6 GA 3 3 5 4 2 5 3 HI ID 1 1 1 IL 10 9 67 13 13 15 10 IN 4 3 26 4 6 5 2 IA 8 7 24 10 5 1 8 KS 5 6 19 11 17 9 11 KY 2 1 1 2 4 1 LA 4 7 23 15 16 14 12 ME 2 1 1 MD 1 4 2 MA 4 1 2 1 1 MI 5 3 26 10 5 6 2 MN 5 10 34 12 3 8 9 MS 5 3 5 5 1 1 3 MO 6 19 45 21 21 13 9 • MT 1 NE 1 1 17 7 6 1 3 NV 1 NH 1 1 NJ 3 1 3 2 4 3 2 NM 1 2 4 3 1 1 NY 6 6 3 2 2 3 1 NC 1 5 2 3 5 3 ND 3 1 1 OH 3 4 20 9 5 3 6 OK 11 9 32 21 26 20 11 OR 1 2 2 4 1 1 PA 1 4 7 6 3 5 1 PR 1 RI 1 SC 1 2 1 1 1 2 2 SO 1 8 2 TN 4 1 4 6 2 5 2 TX 12 35 47 38 35 37 32 LIT 1 VT VA 3 2 1 WA 3 2 2 4 3 3 WV 1 1 WI 5 16 49 9 3 4 6 WY 2 1 1 APO 1 1 2 1 1 1 1 • CAN 1 1 4 1 1 3 1 FOR 1 2 190 220 615 294 246 239 196 Relocation Inquiries - 1998 • Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec TOTAL AL 1 1 1 1 2 AK 1 1 AZ 3 5 6 2 4 8 4 AR 24 23 27 31 18 28 18 CA 19 5 25 10 8 24 6 CO 1 1 4 6 7 2 3 CT 1 1 2 1 DE 1 DC FL 4 5 6 7 6 9 6 GA 1 2 1 2 2 6 2 HI 1 2 1 ID 1 1 1 1 IL 10 3 9 12 5 5 5 IN 2 4 1 2 1 1 IA 7 3 5 1 2 3 4 KS 3 2 7 2 5 5 2 KY 2 2 1 1 LA 1 6 11 7 5 3 2 ME 1 1 MD 2 4 MA 1 2 1 MI 4 8 2 3 2 MN 4 4 6 4 3 3 3 MS 3 4 4 4 1 1 MO 8 5 10 8 11 9 7 • MT 2 1 NE 3 1 3 4 2 2 1 NV 2 2 1 4 3 3 NH 1 NJ 1 1 3 4 2 NM 1 2 2 1 2 2 2 NY 1 3 2 3 2 2 3 NC 1 2 2 2 1 1 1 ND 1 2 OH 2 1 5 3 1 2 1 OK 10 4 3 5 7 8 8 OR 1 1 3 2 2 1 PA 2 1 5 3 2 2 1 PR RI SC 1 2 1 2 1 1 SD 2 TN 3 3 11 6 1 4 4 TX 15 15 21 21 11 15 19 UT 1 1 VT VA 3 2 2 2 2 1 WA 3 2 4 6 2 1 2 WV 6 1 1 1 WI 2 7 4 4 2 3 3 WY 1 3 2 1 1 • APO 2 1 1 1 CAN 1 151 128 223 175 133 164 126 • ADVERTISING INQUIRIES JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Tourist ACW 25 3 6 7 BH 38 534 154 125 52 CWT 2 10 18 5 6 7 D FC 1 11 109 42 23 HT 60 27 H&A 37 187 57 MC 186 456 298 97 ML 32 48 59 2 573 742 668 MVG 275 1232 NG NTG 123 191 448 368 457 365 192 OK 17 12 79 35 SL 14 16 472 139 217 223 108 SMI 35 1131 235 95 57 24 SV TA 13 18 209 98 TJ TM 182 64 171 429 86 77 9 USA 35 471 1392 Meetings • SM 2 3 2 TOTAL 384 359 2653 3729 3637 2397 1369 ACW-Am. Civil War BH-Better Homes & Gardens CWT-Civil War Times D-D Magazine FC-Family Circle HT-Historic Traveler H&A-Home and Away MC-Mccalls ML-Midwest Living MVG-Midwest Vacation NG-Nati Geog Traveler NTG-NATA OK-Oklahoma Today SL-Southern Living SMI-State Mag. Insert SM-Successful Meetings SV-Summer Vacation TA-Travel America TJ-Texas Journal • • Advertising Inquiries by State - July, 1998 ACW BH CWT FC HT H&A MC MWL NTG SL SMI TA TM TOTAL AL 1 1 1 1 9 1 14 AK 0 AZ 1 2 2 3 1 1 10 AR 1 3 7 17 4 3 3 38 CA 3 1 5 1 8 12 13 2 2 7 54 CO 1 2 6 1 1 1 12 CT 1 3 1 5 DE 1 1 2 DC 1 1 1 3 FL 1 2 1 2 8 4 8 7 33 GA 3 4 4 3 5 1 20 HI 1 1 2 ID 1 1 1 2 IL 3 1 1 3 4 133 11 2 1 4 163 IN 1 1 5 4 69 1 1 3 2 87 IA 10 35 7 1 1 1 55 KS 1 1 2 2 36 5 1 1 49 KY 3 1 7 1 2 1 15 LA 3 1 1 19 16 1 4 45 ME 1 1 2 4 MD 1 3 1 1 3 2 10 MA 3 1 2 3 9 MI 1 1 1 1 5 54 2 2 3 70 MN 1 1 2 1 1 37 4 3 49 MS 2 1 1 3 3 1 11 MO 2 1 1 86 9 5 1 3 108 • MT 2 1 3 NE 1 9 7 1 18 NV 1 1 1 2 1 6 NH 1 1 1 NJ 1 1 2 3 1 2 1 3 14 NM 1 2 1 1 5 NY 1 1 1 8 5 1 1 5 23 NC 3 1 3 2 2 3 2 16 NO 6 6 OH 1 4 13 2 57 5 2 5 89 OK 1 10 4 9 18 2 1 5 50 OR 1 4 2 7 PA 2 1 8 3 2 4 20 RI 1 1 Sc 1 2 1 2 6 SO 6 6 TN 1 1 3 2 1 3 2 13 TX 9 2 2 8 33 22 2 7 6 91 UT 1 1 1 1 4 VT 2 2 4 VA 1 1 1 1 2 1 1 8 WA 2 2 1 3 3 1 2 14 WV 1 1 1 1 4 8 WI 9 55 2 66 WY 1 1 2 APO 1 1 CAN 1 0 • FOR 1 2 5 1 3 12 TOTAI 7 52 7 23 27 57 97 668 192 108 24 98 9 1369 Access statistics for w .fayettcvillcar.com (last 12 month) http://w .FayettevilleAR.com/stats/ Access statistics for www.fayeffevillear.com • Summary period: last 12 month Last updated: 23/Jul/1998 21:53 ::::::::::. ::::: ::::::: ::::. ::: ::: ::::.....::::...::. :::. .........: :::: : ::....:..:..:...:.......................................................................................................................................................... . .................................................................................................................................................... Pits/Files/=es/ 'i y�taM by month m _.................. ........... Y a: Y) .a f CCC � U - Jul 97 Rug Sep Oct Nov Dec Jan Feb Mar• Rpr May Jun Jul 98 I Pill IM-1111 111111 111 "Current statistic for Ju 98 u dated more frequent C ..'Oif :.\:Y::>x..x,': ru . . . . ��.... .............................. ...................................................................... ..................................................................................... July 98 27327;; 23351;; 1136 140092: June 98 33620, 29725 , 1529 , 178415: ..... ................................... ;:. ..._. ... ......::::...............................:............ ......... ;May 9830942 : 27740': 13171 16392E .................................................................... ........................................................................................................................: April 98 32927:: 26734:2 1380:; 159067: ;March 98 35528; 29316 1517 , 177707. ........ .................................. ........ .............................. 'February 98 10959 8500 : 504 . 53375. ........ .. ;January 98 20115': 1043& 649: 57690': .............................. ................................. ...................................:..............................::................................................. ;December 97 .................... 20183:;......................8905:1...................... 568 .............._._._................49502 ............:..................................................................._..... .. ::::::.::.::::::::::.:............................................ ....................... .. .02.. :November 97 ! 30685;: 13039 : 57U 76023: ............... :October 97 30790 11860:1 452 : 67576. ::::: ' ...................:...:......... ..................... ..... ::::: ;Sentember97 60078:. 154951 4731 78782; ;August 97 517 270':: 20 1655: ,;r: .sotaLs ,p ., , ? .»333671. , _,,,__ 205lllnl % 1--373 'x .ym1011 » ,�.» � »� »» 1203805 ::.:......:...::.:......................................................................._...................................... ..................... ...... .............. • Full statistics for 1997 1 of 2 8/4/98 3:58 PM LEASE AND AGREEMENT Between CITY OF FAYETTEVILLE, ARKANSAS and • ADVERTISING AND PROMOTION COMMISSION of the CITY OF FAYETTEVILLE, ARKANSAS Dated as of • • LEASE AND AGREEMENT TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 101 Definitions ARTICLE 11 DEMISING CLAUSES, DURATION OF LEASE TERM AND RENTAL PROVISIONS Section 201 Demise of Leased Premises Section 202 Term of Lease and Agreement Section 203 Basic Rent; Additional Rent • ARTICLE III INSURANCE Section 301 Insurance Required ARTICLE IV REPAIRS AND MAINTENANCE OF LEASED PREMISES AND ALTERATIONS Section 401 Lessee Obligated to Maintain Improvements Section 402 Lessee Has Right to Make Additions, Alterations and Changes Section 403 Structural Improvements and Alterations Become Property of Lessor; Machinery, Equipment and Other Property Installed at Lessee's Expense Remain Its Property With Right of Removal Section 404 Lessee to Pay Public Utility Charges • • ARTICLE V USE OF LEASED PREMISES - COMPLIANCE WITH ORDERS, ETC. Section 501 Permitted Use of Leased Premises and Compliance With Laws, etc. Section 502 Use by Local Groups Section 503 Operating charges, revenues and costs of the Project ARTICLE VI LESSOR MAY PERFORM LESSEE'S OBLIGATIONS Section 601 Lessor May Perform Lessee's Obligations; Lessee to Reimburse Lessor for Costs and Expenses Incurred in Doing So ARTICLE VII INSPECTION OF LEASED PREMISES BY LESSOR AND TRUSTEE • Section 701 Lessor and Trustee to Have Right of Inspection and Right to Perform Work Subject to Certain Restrictions ARTICLE VIII DAMAGE AND DESTRUCTION Section 801 Lessee to Restore in Event of Damage or Destruction; Application of Insurance Moneys ARTICLE IX ASSIGNMENT Section 901 Assignment and Subletting Permitted But Lessee Not Relieved of Obligations. • ARTICLE X DEFAULT PROVISIONS Section 1001 Events of Default Section 1002 Remedies Section 1003 Remedies Not Exclusive Section 1004 Rental, Damages and Reletting Handled as Provided in Lease and Agreement and Indenture ARTICLE XI NOTICES Section 1101 Notices ARTICLE XII GENERAL Section 1201 Arkansas Law Applicable Section 1202 Severability • Section 1203 Provisions Binding on Successors and Assigns Section 1204 Lease Agreement Constitutes Entire Agreement Section 1205 Lease Agreement Not to Waive Sovereign Immunity • 4 • LEASE AND AGREEMENT This LEASE AND AGREEMENT made as of by and between the CITY OF FAYETTEVILLE, ARKANSAS ("Lessor" or "City") and the ADVERTISING AND PROMOTION COMMISSION OF THE CITY OF FAYETTEVILLE, ARKANSAS ("Lessee" or "Commission") ; WITNESSETH : 1 . WHEREAS, Lessor is a duly organized and existing municipality, a city of the first class, under the laws of the State of Arkansas with full and lawful power and authority to enter into this Lease and Agreement; and 2 . WHEREAS, Lessee is authorized under the laws of the State of Arkansas to enter into this Lease and Agreement and to perform all covenants and obligations on its part and • to be performed under and pursuant to this Lease and Agreement; and 3. WHEREAS, at a special election held on August 5, 1997 the electors of the City approved the issuance of a $6,950,000 bond issue to finance the construction of the Fayetteville Town Center as a new, multi-purpose, civic center for meetings, conventions, exhibitions, entertainment events, related uses and parking; and 4. WHEREAS, the Bonds are issued by the City but are largely/primarily to be funded by the Advertising and Promotion Commission through the pledge of the City's one cent Hotel and Restaurant Gross Receipts Tax approved by the voters in 1977; and 5 . WHEREAS, the Commission agrees to contribute $ 1 ,000,000 toward the construction of the Town Center; and 6 . WHEREAS, upon completion, the Town Center will be owned by the City; and • 5 7. WHEREAS, the Commission is willing to manage the Town Center and to assume • the financial burden, if any , incurred in such management for the purpose of fulfilling their statutory purpose of advertising and promoting the City and for maintaining and operating a convention center and/or tourist promotion facility in the City; and 8 . WHEREAS, the City believes it is in the best interests of the citizens of Fayetteville for the Commission to manage the Town Center on behalf of the City, NOW, THEREFORE, for valuable consideration, receipt of which is hereby acknowledged by Lessor and Lessee, and in consideration of the mutual benefits and covenants herein contained, Lessor and Lessee AGREE as follows: ARTICLE I DEFINITIONS Section 101 . In addition to the words and terms elsewhere defined in this • Lease Agreement, the following words and terms as used in this Lease Agreement shall have the following meanings unless the context clearly indicates a different meaning or intent: " Bonds" - The City of Fayetteville, Arkansas Hotel and Restaurant Gross Receipts Tax Bonds, Series 1998, issued under and secured by the Indenture, to provide funds to construct and equip the Project. . "Indenture" or "Trust Indenture" - the Trust Indenture and First Supplemental Trust Indenture between the City and the Trustee, which sets forth the details pertaining to the Bonds, the nature and extent of the security and the rights, duties and obligations of the City, the Trustee and the holders and registered owners of the Bonds • and the terms under which the Bonds are secured. 6 " Lease Agreement" - The within Lease and Agreement. • " Lease term" or "Term" - the term of the Lease Agreement set forth in Section 202 . " Leased Premises" - the lands, buildings, improvements, and facilities covered by the Lease Agreement and defined in Section 201 hereof. "Lessee" - the Advertising and Promotion Commission of the City of Fayetteville, Arkansas. " Lessor" - The City of Fayetteville, Arkansas, a city of the first class and located in Washington County, Arkansas. "Project" - The lands, buildings, improvements, and facilities constituting a multi-purpose civic center for meetings and conventions, exhibitions, entertainment events • and related uses, and related parking facilities, collectively to be known as the Fayetteville Town Center financed out of proceeds of the Bonds and other monies and leased under this Lease Agreement. The lands included in the Project are described as Exhibit A attached hereto. " Rent" or " Rents" - the Basic Rent ( provided for in Section 203 (a ) hereof) and the Additional Rent ( provided for in Section 203 ( b) hereof), unless the context clearly indicates both are not intended. "Trustee" - The Trustee for the time being, whether original or successor with the original Trustee being Bank of Oklahoma, N.A., Tulsa, Oklahoma who is a party to the Indenture. 7 ARTICLE II • DEMISING CLAUSES , DURATION OF LEASE TERM AND RENTAL PROVISIONS Section 201 . Lessor, for and in consideration of the rents, covenants and agreements herein reserved, mentioned and contained, on the part of Lessee to be paid, kept and performed, agrees to and does hereby lease to Lessee, and Lessee agrees to, and does hereby lease, take and hire from Lessor, subject to the terms, conditions and provisions of this Lease Agreement expressed, the following: (a ) The lands situation in Washington County, Arkansas, described in Exhibit A attached hereto (the "lands") ; (b) The buildings, structures and other improvements now or at any time hereafter erected and installed on the lands; and • (c) All accretions, easements, rights of way and appurtenances belonging to the lands and/or the improvements described in (a) and (b) above. The properties described in (a), (b), and (c) above are herein collectively referred to as the " Leased Premises". TO HAVE AND TO HOLD the Leased Premises unto the Lessee for the term of this Lease Agreement as hereafter set forth. Section 202 . The term of this Lease Agreement shall commence upon substantial completion of the Project and shall run for a period of fifty ( 50) years. Section 203. (a) Basic Rent Lessee covenants to pay to Lessor, Basic Rent of one dollar per year.-and agrees to contribute $ 1 ,000,000 toward the construction of the Projeet. • 8 ( b) Additional Rent. During the term hereof, Lessee shall pay as Additional • Rent all expenses, liabilities, obligations and other payments of whatever nature which Lessee has agreed to pay or assume under the provisions of this Lease Agreement. ARTICLE III INSURANCE Section 301 . A. Lessee Lessor party shall, at Lessee's Lessor's sole cost and expense, keep the Leased Premises and the furniture, fixtures and equipment insured: ( i) Against the perils of fire and the hazards ordinarily included under broad form extended coverage endorsements in amounts not less than 90% of the full insurable value thereof within the terms of applicable policies. (ii) If there are boiler or pressure vessels, from boiler or pressure vessel explosion in an amount customarily carried in the case of similar industrial • operations. The term "full insurable value" means such value as shall be determined from time to time at the request of Lessor, Lessee or Trustee ( but not required more frequently than once in every forQeight ( 48 ) months) by one of the insurers selected by Lessee. Lessor. B. At all times during the term, Lessee shall, at no cost or expense to Lessor, maintain or cause to be maintained: ( I) General Public Liability insurance against claims for bodily injury or death occurring upon, in or about the Leased Premises, with such insurance to afford protection to the limits of not less than $ 1 ,000,000 in respect of bodily injury or death to any one person and to the limit of not less than $2,000,000 In respect to any one accident; and ( ii) Property damage insurance against claims for damage to property occurring upon, in or about the Leased Premises with such insurance to • afford protection to the limit of not less than $ 50,000 in respect of damages 9 to the property of any one owner. • C. The insurance required by this Article III shall be maintained in full force and effect at all times during the term of this Lease Agreement; D. Copies or certificates of the insurance provided for by this Article or elsewhere in this Lease Agreement shall be delivered to the parties. And, in the case of expiring policies throughout the term, copies or certificates of any new or renewal policies shall be delivered to the parties. E. All insurance required by this Section 301 shall be effected with insurance companies qualified to do business in the State of Arkansas. Appropriate provisions shall be inserted in each insurance policy making each policy noncancellable without at least ten ( 10) days prior written notice to Lessor, Lessee and the Trustee. • ARTICLE IV REPAIRS AND MAINTENANCE OF LEASED PREMISES AND ALTERATIONS Section 401 . Lessee shall throughout the term, at no cost and expense to Lessor, maintain, or cause to be maintained, and at the expiration of the term hereof, yield up or cause to be yielded up, in good and tenantable repair, order and condition, reasonable wear and tear excepted, the improvements now or at any time erected on the lands included in the Leased Premisesand sidewalks adjoining the Leased ; and promptly at no cost and expense to Lessor make or cause to be made all necessary repairs, interior and exterior, structural and non-structural, foreseen as well as unforeseen to such improvements. Section 402 . Lessee shall have the right from time to time to make • additions, alterations and changes in or to the improvements constituting part of the Leased 10 Premises and shall have the right to construct new improvements. It is understood and • agreed that in the event the Lessee makes any additions, alterations and changes in or to the improvements constituting part of the Leased Premises as authorized by this Section, the Lessee shall be under no obligation at the expiration of the term to restore the Leased Premises to their original condition prior to such additions, alterations or changes. Section 403 . All structural improvements and alterations made on the Leased Premises by or on behalf of Lessee shall immediately upon completion thereof be and become the property of the Lessor without payment therefor by Lessor but subject to this Lease Agreement. All machinery and equipment, trade fixtures, movable partitions, furniture and furnishings and other property installed at the expense of Lessee shall remain the property of the Lessee with the right of removal, whether or .not affixed and/or • attached to the real estate, and the Lessee shall, so long as it is not in default hereunder, be entitled but shall not be obligated to remove the same, or any part thereof, during the term, or within a reasonable time thereafter, but Lessee shall at its own cost and expense repair any and all damages to the Leased Premises resulting from or caused by their removal therefrom. Section 404. Lessee agrees to pay or cause to be paid all charges for water, gas, sewer, electricity, light, heat or power, telephone or other service used, rendered or supplied to or for the Lessee upon or in connection with the Leased Premises throughout the term of this Lease Agreement. • 11 ARTICLE V • USE OF LEASED PREMISES - COMPLIANCE WITH ORDERS, ETC. SECTION 501 . Subject to the following provisions of this Section, Lessor and Lessee agree that Lessee shall use the Leased Premises for a multi-purpose civic center for meetings and conventions, exhibitions, entertainment events and related uses and related parking facilities. Lessee shall during the term promptly comply with all valid statutes, laws, and requirements of all federal, state, local and other governments or governmental authorities, including the Bond Indenture and Ordinance, now or hereafter applicable to the Leased Premises. Lessee shall during the term comply with the mandatory requirements, rules and regulations of all insurers under the policies required to be carried under the provisions of this Lease Agreement. • SECTION 502 . The Lease Premises and Portions thereof should be made available by the Lessee for use by 501 (c) ( 3) designated non-profit groups located in the City of Fayetteville, Arkansas, for such events as civic receptions and community meetings during those times when the Lease Premises is not reserved to be utilized for the purposes set forth in Section 5 .01 above. With respect to this Section, a non-profit may not reserve the Lease Premises in excess of thirty ( 30) days prior to the date it will utilize the Lease Premises. Section 503 . The Lessee covenants that it will operate or cause to be operated the facilities constituting the Project in a prudent and financially responsible manner, and will fix, charge and collect reasonable rates, fees and charges for the use of . the facilities constituting the Project and for services performed by the Lessee in connection • therewith. To the extent that revenues from the facilities constituting the Project are 12 insufficient therefore, all operating costs of the Project will be paid by the Lessee. • Section 504. Lessee covenants that it will at all times operate the Project as a convention center within the requirements of the Advertising and Promotion Commission Act, Ark. Code Ann. Section 26- 75-601 through 618 so that the Lessor will qualify under the provisions of the City-County Tourist Meeting and Entertainment Facilities Assistance Law (Ark. Code Ann. Section 14- 171 -210 through 217) for turnback funds. Section 505 . Lessee covenants for the benefit of the Lessor and the holders of Lessor's outstanding Hotel and Restaurant Gross Receipts Tax Bonds that in operating the Project it will comply with all requirements of the Internal Revenue Code of 1986, as amended, which are required for interest on the Bonds to be excludable from gross income for federal income taxation purposes. • ARTICLE VI LESSOR MAY PERFORM LESSEE'S OBLIGATIONS Section 601 . If Lessee shall fail to keep or perform any of its obligations as provided in this Lease Agreement in respect of (a ) maintenance of insurance; ( b) repairs and maintenance of the Leased Premises; (c) compliance with legal or insurance requirements; and (d) making of any other payments or performance of any other obligations, then Lessor may ( but shall not be obligated to do so), upon the continuance of such failure on Lessee's part for thirty ( 30) days after written notice to Lessee, and without waiving or releasing Lessee from any obligation, and as an additional but not exclusive remedy, make any such payment or perform any such obligation ( not under circumstances where such payment or performance would defeat any rights, herein specifically given to • Lessee, to withhold such performance or to contest such obligation to the extent herein 13 provided ), and all sums so paid by Lessor and all necessary incidental costs and expenses • incurred by Lessor in making such payment or performing such obligation shall be deemed Additional Rent and shall be paid to Lessor on demand. ARTICLE VII INSPECTION OF LEASED PREMISES BY LESSOR AND TRUSTEE Section 701 . Lessee shall permit Lessor and the Trustee or either of them, by their respective authorized representatives, to enter the Leased Premises at all reasonable times during usual business hours for the purpose of inspection, and for the performance of any work therein made necessary by reason of Lessee's default under any of the provisions of this Lease Agreement. ARTICLE VIII • DAMAGE AND DESTRUCTION Section 801 . A. Lessee covenants and agrees that in the event of damage to or destruction of the Leased Premises, or any part thereof, by fire or other casualty, the Lessee shall immediately notify the Lessor and the Trustee. If the Leased Premises sustain "major damage or destruction, " (as hereafter defined) either parry may terminate this Lease Agreement by written notice to the other party and the Trustee given within 45 days after casualty and Rents shall be paid to the date of the casualty. If the damage does not constitute major damage or destruction, Lessee shall proceed to restore, repair, rebuild or replace the Leased Premises as nearly as possible to the condition they were in immediately prior to such damage or destruction. • B. The term "major damage or destruction" as used in this Section is 14 defined to mean any damage or injury to or destruction of the Leased Premises or any part • thereof (whether or not resulting from an insured peril) such that the Leased Premises cannot reasonably be restored to its condition immediately preceding such damage, injury or destruction within a period of ninety (90) working days, or which would prevent Lessee from carrying on its operations therein for a period of ninety (90) working days or the restoration cost of which would exceed the total amount of insurance carried on the Leased Premises in accordance with the provisions of Article III hereof. C. All insurance money paid on account of such damage or destruction shall be paid to the Lessor and applied only to the payment of the cost of the restoration, repairs, replacements or rebuilding, including expenditures made for temporary repairs or for the protection of property pending the completion of permanent restoration, repairs, • replacements, or rebuilding or to prevent interference with the business operated thereon (sometimes referred to as the "restoration") . ARTICLE IX ASSIGNMENT Section 901 . A. Lessee may not assign this Lease Agreement or sublet the Leased premises or part thereof for a period longer than 60 days without the prior written consent of Lessor. No such assignment or subletting and no dealings or transactions between the Lessor and any sublessee or assignee shall relieve the Lessee of any of its obligations under this Lease Agreement and Lessee shall remain as fully bound as though no assignment or subletting had been made, and performance by any assignee or sublessee shall be considered as performance pro tanto by Lessee. • 15 ARTICLE X • DEFAULT PROVISIONS Section 1001 . The following shall be "events of default" under this Lease Agreement and the terms "event of default" or "default" shall mean, whenever they are used in this Lease Agreement, any one or more of the following events: (a) Failure by the Lessee to observe and perform any covenant, condition or agreement on its part to be observed or performed, (1) for a period of thirty ( 30) days after written notice, specifying such failure and requesting that it be remedied, given to the Lessee by the Lessor unless the Lessor shall agree in writing to an extension of such time prior to its expiration or (ii) for such longer period as may be reasonably necessary to remedy such default provided that the Lessee is proceeding with reasonable diligence to remedy the same. Section 1002 . Whenever any event of default shall happen and then be continuing, the Lessor er the Trusteemay take any of the following remedial steps: • (a) The Lessor may re-enter and take possession of the Leased Premises without terminating this Lease Agreement, and sublease the Leased Premises for the account of the Lessee, holding the Lessee liable for the difference in the rent and other amounts payable by the Lessee hereunder. ( b) The Lessor may terminate the term, exclude the Lessee from possession of the Leased Premises and use its best efforts to lease the Leased Premises to another for the account of the Lessee, holding the Lessee liable for all rent and other payments due up to the effective date of any such leasing. (c) The Lessor shall have access to and inspect, examine and make copies of the books and records relating to the Leased Premises. (d) The Lessor may take whatever action at law or in equity may appear necessary or desirable to collect the rent and any other amounts payable by Lessee hereunder, then due and thereafter to become due, or to enforce performance and observance of any obligation, agreement or covenant of the Lessee under this Lease Agreement. Section 1003. No remedy herein conferred upon or reserved to the Lessor • is intended to be exclusive of any other available remedy or remedies, but each and every 16 such remedy shall be cumulative and shall be in addition to every other remedy given • under this Lease Agreement as now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof but any such right or power may be exercised from time to time as often as may be deemed expedient. Section 1004. The foregoing provisions of this Article relating to the receipt of moneys by Lessor as the result of an acceleration, upon a reletting or otherwise are each to be construed as providing that all such payments by Lessee or others shall be handled as provided in this Lease Agreement and in the Indenture. ARTICLE XI • NOTICES Section 1 101 . All notices, demands and requests which may or are required to be given by either party to the other or to the Trustee shall be in writing, and each shall be deemed to have been properly given when served personally on an executive officer of the party to whom such notice is to be given, or when sent postage prepaid by certified mail by deposit thereof in a duly constituted United States Post Office or branch thereof located in one of the present states of the United States of America in a sealed envelope addressed as follows: If intended for Lessee: • With Copy to: 17 If intended for Lessor: Mayor City Administration Building 113 W. Mountain Fayetteville, AR 72701 If intended for Trustee: (To be supplied by Lessor) Any party or the Trustee may change the address and the name of addressee to which subsequent notices are to be sent by notice to the other parties given as aforesaid. ARTICLE XII • GENERAL Section 1201 . This Lease Agreement shall be construed and enforced in accordance with the laws of the State of Arkansas. Section 1202 . If any provision of this Lease Agreement or the application thereof to any person or circumstance shall, to any extent, be determined to be invalid or unenforceable, the remainder of this Lease Agreement and the application of its provisions to persons or circumstances other than those as to which it has been determined to be invalid or unenforceable, shall not be affected thereby, and each provision of this Lease Agreement shall be valid and shall be enforced to the fullest extent permitted by law. Section 1203 . The provisions of this Lease Agreement shall bind and inure to the benefit of the parties hereto and their respective successors, assigns and sublessee. • Section 1204. The within Lease Agreement constitutes the entire 18