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CITY OF GLENDALE
GROUND LEASE
This Ground Lease ("Lease") is made as of the ___ day of February, 2025 ("Effective
Date"), by and between the City of Glendale, Arizona, an Arizona municipal corporation ("City"
or “Lessor”), and VAI Resorts, LLC ("Tenant" or “Lessee”), an Arizona limited liability
company. City and Tenant may be referred to herein individually as a "Party" or collectively as
the "Parties."
RECITALS
On October 15, 2015, the City acquired approximately 19.7 acres of real property generally
located at the Southwest corner of Cardinals Way and 91st Avenue, (‘PS Parcel’), to meet
existing City contractual obligations, to support the City’s existing infrastructure and amenities
associated with Glendale’s Sports an Entertainment District, including the Westgate
Development, the Desert Diamond Arena, and the State Farm Stadium.
At the time of acquisition, the PS Parcel was zoned as the “Centrada Planned Area
Development”, approved by the City of Glendale on November 25, 2008.
Thereafter, the City commenced improving the PS Parcel in accordance with the Centrada
Planned Area Development, including constructing and operating a parking lot (“Black lot”) and
exchanging a portion of the PS Parcel property as part of a Settlement Agreement between the
City, AZSTA, the Cardinals, New Cardinals Stadium LLC, and Stadium Development LLC, (the
Stadium Parking Settlement Agreement, as amended and supplemented (City Contract #C-
11329, Recorded November 16, 2016, Instrument Number 2016-0847071) between the City of
Glendale and the Arizona Cardinals and Arizona Sports and Tourism Authority (“AZSTA”)
(“Stadium Parking Settlement Agreement”).
The City continued improving the PS Parcel in accordance with the Centrada Planned Area
Development and in recognition of the encumbrances associated with the Parking Settlement
Agreement with the Arizona Cardinals, Arizona Sports and Tourism Authority and the City’s
obligations and desires to supply parking spaces in conjunction with the operation of neighboring
venues and development. The City engaged the Plaza Del Rio Management Company to perform
certain consulting services including the branding of the PS Parcel (City Contract #C21-1021)
and, site planning the PS Parcel (City Contract #C21-0879), including establishing phasing for
construction of infrastructure that included obtaining consensus with the Arizona Cardinals and
AZSTA. Additionally, the City engaged Plaza Del Rio Management Company to list for sale the
unencumbered areas of the PS Parcel (City Contract #C22-0279)
PS Parcel (City Contract #C21-1021) and, site planning the PS Parcel (City Contract #C21-
0879), including establishing phasing for construction of infrastructure that included obtaining
consensus with the Arizona Cardinals and AZSTA. Additionally, the City engaged Plaza Del
Rio Management Company to list for sale the unencumbered areas of the PS Parcel (City
Contract #C22-0279)
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City is the owner of certain real property generally located at 95th Avenue and
Montebello Avenue in Glendale, Arizona (the "Property"). The Property is within the Centrada
PAD, and is currently a vacant, developable lot, lying within the Northeast Quarter of Section
16, Township 2 North, Range 1 East of the Gila and Salt River Meridian, Maricopa County,
Arizona. The Property is more particularly described in the Minor Land Division for the
Montbello 95 Addition filed as Document 2024-0647421 with the Maricopa County Recorder on
December 5, 2024, as:
NOW THEREFORE, pursuant to this Lease, City grants Tenant a revocable Lease to enter upon
and use the Property under the following terms and conditions, including, but not limited to,
providing the Consideration contained in Section 3 below. The City believes that the
contruction, operation and maintenance of the Improvements (as defined in Section 5 herein)
provided by Tenant under this Lease will, among other things, improve the traffic and pedestrian
grid, enhance the City’s public safety in the City’s Sports and Entertainment District, and furter’s
the City’s economic interests as the property owner, as intended when the City acquired the
property.
Nothing herein shall be construed as a conveyance of any ownership interest in the
Property.
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1.
Purpose of Lease
a.
City hereby leases the Property to Tenant, and Tenant hereby leases the Property from
City subject to the promises, terms and conditions contained in this Lease. Tenant acknowledges
that, as of the Commencement Date, it has inspected the Property, is familiar with the physical
condition of the Property and the condition of title to the Property and accepts the same "as is" in
its present condition, with no representation by, of or from City. Nothing in this Agreement
provides a warranty or guarantee that the Property is suitable for Tenant’s intended purpose.
b.
Tenant wishes to lease the Property from the City to construct a mixed-use building and
related drive aisles incident to operating the adjacent parcel(s) as a hotel and entertainment venue
(“VAI Resort”) and incident to operating a nearby parking garage for the benefit of VAI Resort
guests and employees.
2.
Term
The term of this Ground Lease commences as of the Effective Date and continues for a
period of twenty-five (25) years from the Effective Date or until the earlier termination of this
Ground Lease in accordance with its terms (the “Initial Term”). Unless earlier terminated
pursuant to the terms and coniditons set forth herein, the Term may be extended upon written
agreement by the parties for two (2) additional ten-year Terms (the Initial Term and extension
terms agreed to by the Parties hereinafter collectively referred to as the “Term”).
3.
Compensation/Consideration
a.
In exchange for the Lessee’s occupation and use of the Property, Lessee shall provide
Lessor the following consideration, the receipt and sufficiency of which are hereby
acknowledged by each of the Parties hereto:
i.
Tenant shall sublease to City no less than 2,000 square feet of finished office
space for traffic management, police and emergency response operations. The
sublease shall be at no cost to the City and shall be for a period concurrent with
this Ground Lease, including any extensions. City may configure this finished
office space in any manner it so chooses and the City shall be responsible for
furnishing such space at its own cost.
a. It is the intention of the Parties hereto that, insofar as the same may be
lawfully done, City, as a subtenant, will be free from all utilities, costs,
expenses, obligations, taxes, assessments, and all other governmental
impositions and charges, throughout the Term.
b. City shall have the right to place exterior signage on the mixed-use building
identifying the municipal operations.
ii.
Tenant, at its sole cost and expense, shall cause to be constructed a pedestrian
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bridge across 95th Avenue to allow for pedestrian traffic to travel to and from the
VAI Resort. The Parties acknowledge and agree that the pedestrian bridge is not
eligible for any development impact fee offset or credit.
iii.
Tenant, at its sole cost and expense, shall cause to be constructed the
Improvements (as defined in Section 5 below) in such a manner that the
remaining stormwater basin shall accommodate all existing flows (actual and
anticipated). Additionally, Tenant, at its sole cost and expense, shall landscape
and maintain the remaining stormwater basin for the Term of this Ground Lease.
b.
Tenant shall also pay certain Additional Charges to the City during the Term of this
Lease. "Additional Charges" are defined as: (i) all taxes, including the City transaction privilege
tax, assessments, insurance premiums, charges, costs and expenses which Tenant agrees to pay
under this Lease or is obligated to pay by law, together with all interest and penalties that may
accrue thereon in the event of Tenant's failure to pay the same as herein provided; (ii) all other
damages, costs and expenses which City may suffer or incur for which Tenant is liable under this
Lease; and (iii) any and all other sums which may become due, by reason of any default of
Tenant or failure on Tenant's part to comply with the agreements, terms, covenants and
conditions of this Lease. In the event of nonpayment of any Additional Charges as defined in this
Section 3 within thirty (30) days of receipt of an invoice, City will provide notice of such
noncompliance to Tenant and an opportunity to cure. Tenant shall have fifteen (15) days to
make payment to bring its account current. Should nonpayment continue beyond the 15-day
cure period, the City may assess a late payment charge in the amount of ten percent (10%) of the
delinquent amount and the City may exercise all rights and remedies herein provided and
available in law or equity.
c.
Except as set forth above, Compensation and Additional Charges and all other sums
payable by Tenant hereunder will be paid without notice, demand, counterclaim, setoff,
recoupment, deduction or defense of any kind or nature and without abatement, suspension,
deferment, diminution or reduction.
4.
Taxes, Assessments and Utilities
a.
It is the intention of the Parties hereto that, insofar as the same may be lawfully done,
City will be free from all costs, expenses, obligations, taxes, assessments and all other
governmental impositions and charges, throughout the Term. Tenant will pay and discharge, as
and when the same become due and payable without penalty, all real estate, personal property,
business, transaction privilege, occupation and occupational license taxes and assessments and
all other governmental taxes, impositions and charges of every kind and nature, general or
special, foreseen or unforeseen, whether similar or dissimilar to any of the foregoing, which at
any time during the Term of this Lease be or become due and payable by City or Tenant and
which are levied, assessed or imposed:
i.
Upon or with respect to, or will be or become liens upon, the Property, or any
portion thereof or any interest of City or Tenant therein or under this Lease (other than
liens created or granted by City in its capacity as the fee owner of the real property
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constituting the Property, as opposed to liens created by City in its capacity as a
municipality, which are subject to this Section 4):
ii.
Upon or with respect to the possession, operation, management, maintenance,
alteration, repair, rebuilding, use or occupancy of the Property; and
iii.
Upon this transaction or any document to which Tenant is a party or is bound,
creating or transferring an interest or an estate in the Property, under or by virtue of any
present or future law, statute, charter, ordinance, regulation, or other requirement of any
governmental authority.
b.
Tenant has the right to contest any claim, tax or assessment levied against the Property or
any interests therein and property thereon during the term of the Lease or from Tenant's activities
by posting bonds to prevent enforcement of any lien resulting therefrom. Tenant agrees to protect
and hold City harmless (and all interest of City in the Property) and all interests therein and
improvements thereon for, from and against any and all claims, taxes, assessments and like
charges and from any lien therefor or sale or other proceedings to enforce payment thereof, and
all costs in connection therewith, but only as to those that arise or occur during the Term of this
Lease. City agrees to cooperate with Tenant and will promptly execute and deliver for filing any
appropriate documents with reference to any such contest when so requested by Tenant.
c.
Tenant, upon City's written request, will furnish to City, within twenty (20) days
thereafter, proof of the payment of any taxes, impositions or charges which Tenant and not City
has the obligation to pay under the provisions of this Section 4.
d.
Tenant will be solely responsible for, and will pay the cost of, constructing or installing
utility hookups from existing utility infrastructure to the Property and will be solely responsible
for, and will pay the cost of, all utility services consumed by Tenant on the Property.
5.
Use of Property and Construction of Improvements
a.
The Property may only be developed and used in accordance with Applicable Laws,
including the City’s Zoning Code (collectively, the "Permitted Uses"). Tenant will use the
Property solely for the purpose identified in Section 1 and not for any other purpose without the
prior written consent of City, which consent may be withheld, conditioned or delayed in City's
sole, absolute and unfettered discretion. Use of the Property in violation of the material terms of
Section 1, this Section 5, Section 6, Section 7 (Regulatory Requirements), or any other relevant
Section of this Lease will cause Tenant to be in default hereunder; however, Tenant will have the
right to cure said default pursuant to the provisions of Section 21 of this Lease.
b.
The Parties acknowledge that the Property is currently vacant and is adjacent to the City-
owned parking lot known as “the Black Lot,” which is subject to the Stadium Parking Settlement
Agreement dated November 15, 2016, as amended (attached as Exhibit B). The Parties agree
that Tenant may demolish and remove any existing improvements adjacent to the Black Lot,
including, but not limited to, asphalt pavement, curbs, gutters, medians, landscaping and
streetlights and make Tenant improvements for its intended use at Tenant’s sole cost, provided
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such demolition and removal in conducted in a manner that complies with all terms and
conditions of the Stadium Parking Settlement Agreement. Further, when demolishing and/or
removing any existing improvements adjacent to the Black Lot, constructing the Improvements
as defined in this Section or any subsequent improvements on the Property, Tenant shall not
undertake such activities in a manner that disrupts or interferes with the right of the parties to the
Stadium Parking Settlement Agreement to use the 4,011 parking spaces located within the PS
Parcel during “Events” or “NFL Dates” as those terms are therein defined.
c.
Tenant, at its sole cost and expense, will cause to be constructed and completed a mixed-
use building, related drive aisles, a pedestrian bridge and other structures, facilities and other
leasehold improvements, including landsaping, fixtures, and equipment related to support its
operations, security and parking activities (collectively, the "Improvements") at the VAI Resort.
Any construction on the Property must be undertaken and completed in compliance with Title 34
of the Arizona Revised Statutues, Chapter 2, Article V of the City Code (Purchasing Procedure),
the Cityapproved Site Plan, the Zoning Code, Building Code and any and all other generally
applicable City requirements for the use of such commercial properties. Tenant will pursue
diligently the construction of all Improvements to completion.
d.
City agrees to join in the execution of any instruments which may reasonably be required
in order for Tenant to procure the issuance of any licenses, occupational permits, building
permits or other government approvals required by Tenant in its use, occupancy or construction
of Improvements on the Proeprty. Nothing in this Lease, however, constitutes an agreement that
such approvals will be issued outside the normal course of business for such approvals by the
City.
e.
The Parties agree and acknowledge that any subsequent improvement constructed or
installed by Tenant during the term of this Lease must be approved by the City prior to
construction being commenced and must comply with all terms and conditions of the Stadium
Parking Settlement Agreement.
f.
The Parties agree and acknowledge that any Improvement or subsequent improvement
constructed or installed by Tenant during the term of this Lease does not constitute a
"government property improvement" as defined in A.R.S. §42-6201.
6.
Duty to Operate, Maintain and Repair
a.
At all times during the Term of this Lease, Tenant will operate and maintain, at its sole
cost and expense, all Improvements on the Property in compliance with all Applicable Laws,
including but limited to, the Americans with Disabilities Act. For purposes of this Lease, the
term "Applicable Laws" means the federal, state, county and local laws (statutory and common
law) ordinances, rules, regulations, permit requirements, and other requirements and official
policies of the City of Glendale, as they may be amended from time to time, which apply to the
development, use and operation of the Property and the Improvements during the Term of this
Lease.
b.
Tenant at all times during the Term of this Lease, and at Tenant's sole cost and expense,
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will keep, operate and maintain the Property and all related Improvements, including but not
limited to all buildings, facilities, structures, driveways, parking areas, walking paths, walkways,
pedestrian bridges, asphalt, concrete and landscaped areas, in a clean and sanitary condition and
in good order and repair. All repairs, modifications, alterations, and replacements will be made
promptly and be equal or better in quality and class to the original work. Tenant waives any right
created by the City’s ownership of the Property or any legal requirement (now or hereafter in
force) to make repairs to the Property and Improvements at City's expense, it being understood
that City will in no event be required to make any alterations, improvements or repairs during the
Term; except that if any damage to the buildings, facilities, structures, or improvements on the
Property, or to any equipment or appurtenances located thereon, will have been solely as a result
of City's grossly negligent or intentional actions (but expressly excluding any matter pertaining
to or arising from the condition of the Property as of the Effective Date), City will pay the cost
thereof to Tenant.
7.
Regulatory Requirements
a.
Tenant will promptly observe and comply with all present and future laws, ordinances,
requirements, rules and regulations of all governmental authorities, including the City, having or
claiming jurisdiction over the Property or any part thereof and of all requirements in written
insurance policies covering the Property or any part thereof required in this Section 7 (the
"Regulatory Requirements"). Without limiting the generality of the foregoing, Tenant shall, prior
to initiating any construction activities on the Property, procure each and every permit, license,
certificate or other authorization required in connection with the lawful and proper use of the
Property or required in connection with any building, structure or improvement hereafter erected
thereon.
b.
Tenant covenants and agrees not to use, generate, release, manage, treat, manufacture,
store, or dispose of, on, under or about, or transport to or from (any of the foregoing hereinafter
described as "Use") the Property any Hazardous Materials (other than De Minimis Amounts).
Tenant further covenants and agrees to pay all costs and expenses associated with any response,
including any removal or remedial action, or any other enforcement action threatened,
undertaken or ordered by any governmental or regulatory agency, administrative or judicial body
related to the Use of any Hazardous Materials in any amount by Tenant, its employees, agents,
invitees, subtenants, licensees, assignees or contractors.
c.
For purposes of this Lease: (i) the term "Hazardous Materials" includes, but is not limited
to, any hazardous substance, pollutant or contaminant such as asbestos, urea formaldehyde,
polychlorinated biphenyls, oil, petroleum products, pesticides, radioactive materials, hazardous
wastes, biomedical wastes, toxic substances or any other byproduct thereof, as defined in
applicable federal or state law; (ii) the term "De Minimis Amounts" means, with respect to any
given level of Hazardous Materials, that such concentration or quantity of Hazardous Materials
in any form or combination of forms (A) does not constitute a violation of or trigger any
response, including any increased monitoring, under any Hazardous Materials Laws and (B) does
not pose any risk to human health or the environment; and (iii) the term "Hazardous Materials
Laws" means any federal, state, county, municipal, local or other statute, law, ordinance or
regulation now or hereafter enacted which may relate to or deal with the protection of human
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health or the environment, including but not be limited to the Comprehensive Environment
Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 960 I, et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901; the Federal Water Pollution Control
Act, 33 U.S.C. Section 1251, et seq.; the Toxic Substances Control Act of 1976, 15 U.S.C.
Section 2601, et seq.; Ariz. Rev. Stat. Ann., Title 49 (the "Arizona Environmental Quality Act of
1986"); and any rules or regulations legally adopted or promulgated pursuant to any of the
foregoing as they may be amended or replaced from time to time.
c.
Either party has the right, at its sole cost and expense, to contest the validity of any
Regulatory Requirements applicable to the Property by appropriate proceedings diligently
conducted in good faith provided, however, that no such contest will subject the other party to
any liability, cost, expense or penalty or delay any response ordered by any governmental entity.
8.
Liens
a.
Tenant has no authority to do any act or make any contract that may create or be the basis
for any lien, mortgage or other encumbrance upon any interest of City in the Property, provided
however that Tenant is not prohibited from entering into any contracts in Tenant's capacity as a
tenant, rather than as the title holder of said real property. Should Tenant cause any construction,
alterations, modifications, restorations, replacements, changes, additions, improvements or
repairs to be made on the Property, or cause any labor to be performed or material to be
furnished thereon, therein or thereto, neither the City nor the Property will under any
circumstances be liable for the payment of any expense incurred or for the value of any work
done or material furnished, and Tenant will be solely and wholly responsible to contractors,
laborers and materialmen performing such labor and furnishing such material.
b.
If, because of any error, act, or omission (or alleged error, act or omission) of either
Tenant or City, any mechanics', materialmen's or other lien, charge or order for the payment of
money will be filed or recorded against the real property included within the Property or against
City (whether or not such lien, charge or order is valid or enforceable as such), Tenant or City, as
the case may be, will, at its own expense, either cause the same to be discharged of record or
bonded over pursuant to A.R.S. § 33-1004 within thirty (30) days after either has received from
the other a written notice requesting such discharge.
c.
City will keep the fee title free and clear of all liens and encumbrances that may
adversely affect Tenant's leasehold interest in this Lease.
9.
Insurance
Without limiting any liabilities or any other obligations of Lessee, Lessee shall provide and
maintain, with forms and insurers acceptable to Lessor, and until all obligations under the Lease
are satisfied, the minimum insurance coverages, as follows:
a.
If applicable, worker's compensation insurance to cover obligations imposed by
applicable federal and state statutes and employer's liability insurance with a minimum limit of
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Two Million and No/100 Dollars ($2,000,000.00).
b.
General liability insurance with a minimum combined single limit of Four Million
Dollars ($4,000,000.00) each occurrence. The policy shall include coverage for bodily injury
liability, property damage liability, and for liability assumed under this Lease.
c.
If applicable, comprehensive automobile liability insurance with a combined single limit
for bodily injury and property damage of not less than Two Million and No/100 Dollars
($2,000,000.00) each occurrence with respect to Lessee's vehicle, whether owned, hired or non-
owned, assigned to or used in the performance of the work.
d.
The policies required by Sections 9(b) and 9(c) hereof shall be endorsed to include
Lessor, members of its governing bodies, its officers, agents and employees as additional
insureds and shall stipulate that the insurance afforded for Lessor, members of its governing
bodies, its officers, agents and employees shall be primary insurance and that any insurance
carried by Lessor, members of its governing bodies, its officers, agents or employees shall be
excess and not contributory insurance.
e.
Lessee shall waive their rights of recovery and require its insurers providing the required
coverages to waive all rights of subrogation against Lessor and members of its governing bodies,
its officers, agents and employees for matters arising out of this Lease.
f.
Upon execution of this Lease, Lessee shall furnish Lessor with Certificates of Insurance
as evidence that policies providing the required coverages, conditions and limits are in full force
and effect. Such certificates shall provide that not less than thirty (30) days advance notice of
cancellation, termination, or alteration shall be sent directly to Lessor addressed as follows:
City of Glendale
Risk Manager
5850 W. Glendale Avenue
Glendale, Arizona 85301
g.
The insurance policies may provide coverages that include deductibles or self-insured
retentions. Lessee shall be solely responsible for deductibles and/or self-insured retentions, and
City, at its option, may require Lessee to secure the payment of such deductibles or self-insured
retentions by a surety bond or an irrevocable and unconditional letter of credit.
10.
Damage or Destruction
a.
In the event of damage to or destruction of any of the buildings, structures or
improvements built upon the Property by fire or other casualty, Tenant will give City immediate
notice thereof and will at its own expense and whether or not the insurance proceeds are
sufficient for the purpose, promptly commence and thereafter diligently pursue completion of
any repair, restoration or replacement of the same so that upon completion of such repairs,
restoration or replacement, the value and rental value of the buildings, structures or
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improvements will be sufficient to ensure City will receive all Compensation and Additional
Charges in accordance with the schedule contained herein.
b.
Notwithstanding anything to the contrary contained herein, if the buildings, structures or
improvements built upon the Property by Tenant should be rendered untenable by fire or other
casualty during the last five (5) years of the Lease Term to the extent of fifty percent (50%) or
more of the replacement cost of said buildings, structures or improvements, Tenant may, at
Tenant's option, terminate this Lease. Tenant's option to terminate must be exercised by a
written notice given to City within sixty (60) days after the occurrence of such damage or
destruction.
11.
Indemnification
a.
Tenant will indemnify, defend, pay and hold City, its agents, representatives, officers,
directors, elected and appointed officials and employees harmless for, from and against any and
all claims, demands, fines, penalties, costs, expenses, damages, losses, obligations, judgments,
liabilities, and suits (including attorneys' fees, experts' fees and court costs associated with such
matters; all of the foregoing, collectively, "Claims") imposed upon or asserted against City, its
agents, representatives, officers, directors, elected or appointed officials, and employees, by
reason of any of the following: (i) any act or omission by Tenant, or its employees, contractors,
subcontractors, agents or representatives, undertaken in fulfillment of Tenant's obligations under
this Lease; (ii) any use or nonuse of, or any condition created by Tenant on the Property or any
part thereof; (iii) any accident, injury to or death of persons (including workmen) or loss of or
damage to property occurring on or about the Property or any part thereof; (iv) performance of
any labor or services or the furnishing of any materials or other property with respect to the
Property or any part thereof; (v) any failure on the part of Tenant to comply with any of the
matters set forth in Section 7 of this Lease, including but not limited to any failure by Tenant to
clean up any Hazardous Materials; and (iv) all Claims relating to or arising from design,
construction and structural engineering acts or omissions related in any way to, of or in
connection with, the Improvements on the Property, and all subsequent design, construction,
engineering and other work and improvements by or on behalf of Tenant (collectively,
"Indemnity")
b.
In the event City, its agents, representatives, officers, directors, elected and appointed
officials, and employees should be made a defendant in any action, suit or proceeding brought by
reason of any the occurrences described in this Section 11, Tenant will at its own expense resist
and defend such action, suit or proceeding or cause the same to be resisted and defended by
counsel designated by Tenant and reasonably approved by City. Except for the negligent or
intentional acts of City, its agents, representatives, officers, directors, elected and appointed
officials, and employees, if any such action, suit or proceeding should result in a final judgment
against City, Tenant will promptly satisfy and discharge such judgment or will cause such
judgment to be promptly satisfied and discharged.
c.
Notwithstanding the terms and conditions contained in Subsection 11(b) above, Tenant
is required to indemnify, defend, pay and hold harmless City, its agents, representatives, officers,
directors, elected and appointed officials, and employees in the event negligence is imputed by
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operation of law against City, its agents, representatives, officers, directors, elected and
appointed officials, and employees as a result of the actions or non-action of Tenant, its agents,
servants, employees, directors, representatives, officials, customers, vendors, guests, licensees or
invitees on the Property.
d.
Tenant's obligations of Indemnity will survive the expiration or earlier termination of this
Lease.
12.
Assignment and Subletting
Tenant shall not assign, transfer or sublet any interest in the Property or this Lease without the
prior written consent of City, which consent may be given or withheld in City's sole and
unfettered discretion.
13.
Hypothecation of Leasehold Estate
Notwithstanding the prohibition on creating a lien on the Property contained in Section 8 above,
Tenant may mortgage its interest in this Lease if it obtains the prior written consent of City,
which consent may be withheld, conditioned or delayed in City's sole, absolute and unfettered
discretion.
14.
Default by Tenant
a.
Each of the following occurrences will be a default ("Default") of this Lease:
1.
If Tenant fails to provide or pay any Compensation, Additional Charges or any
other sum due hereunder promptly when due (a "Payment Breach") and such Payment
Breach continues beyond any applicable notice and cure period;
2.
If Tenant fails to perform or comply with any of the other material covenants,
agreements, conditions or undertakings herein to be kept, observed and performed by
Tenant (other than a Payment Breach) and such failure continues for thirty (30) days after
notice thereof in writing to Tenant; or
3.
If Tenant voluntarily files any petition, or has an involuntary petition filed on its
behalf, under any chapter or section of the Federal Bankruptcy Code or any similar law,
state or federal, whether now or hereafter existing, or files an answer admitting
insolvency or inability to pay its debts; provided however, that Tenant shall not remain in
Default if Tenant continues timely to provide and/or pay all Compensation and
Additional Charges and otherwise fully comply with all other terms and conditions of this
Lease.
4.
If Tenant makes an assignment for the benefit of its creditors.
5.
If Tenant requests a waiver of the provisions of Section 15 and said waiver
continues for a period greater than one (1) year.
b.
Upon the occurrence of any Default, City will have the right, at its election, to terminate
this Lease and reenter, occupy and take possession and control over the Property and the any
buildings, structures and improvements then situated thereon, or any part thereof, and to expel,
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remove and put out Tenant and all persons occupying or upon the same under Tenant, using such
force as may be necessary in so doing. Such right may be exercised without obtaining a court
order. Such right shall include the right to receive all rental income of and from the same. No
reentry by City will be deemed an acceptance of a surrender of this Lease, nor will it absolve or
discharge Tenant from any liability, including the right to provide and/or pay Compensation and
Additional Charges, under this Lease. Upon such reentry, all rights of Tenant to occupy or
possess the Property cease and terminate.
c.
The right to terminate and reenter shall be exercised by giving Tenant notice as provided
in Section 22 at least 15 days prior to reentry. Such Notice shall specify the date this Lease will
terminate and reentry will occur. Upon termination of this Lease, Tenant will quit and
peacefully surrender to City the Property and the buildings, structures and improvements then
situated thereon.
d.
Notwithstanding the foregoing, in the event of a Default specified in Section 21, this
Lease, all rights of Tenant under this Lease, will automatically and without notice terminate after
the end of the 30 day cure period set forth therein. Upon such termination, Tenant will quit and
peacefully surrender to City the Property and the buildings, structures and improvements then
situated thereon.
e.
At any time and from time to time after such reentry, City may re-let the Property and the
buildings, structures and improvements thereon, or any part thereof, in the name of City or
otherwise, for such term or terms (which may be greater or less than the period which would
otherwise have constituted the balance of the Term of this Lease), and on such conditions (which
may include concessions or free rental) as City, in its reasonable discretion, may determine and
may collect and receive the rental therefore. Even though it may re-let the Property, City will
have the right thereafter to terminate this Lease and all of the rights of Tenant in or to the
Property.
f.
Unless City has notified Tenant in writing that it has elected to terminate this Lease, no
such reentry or action in lawful detainer or otherwise to obtain possession of the Property will
relieve Tenant of its liability and obligations under this Lease; and all such liability and
obligations will survive any such reentry. In the event of any such reentry, whether or not the
Property and the buildings, structures and improvements thereon, or any part thereof, have been
relet, Tenant will pay and/or provide to City the entire Compensation and all other Additional
Charges required to be paid by Tenant up to the time of such reentry under this Lease, and
thereafter Tenant, until the end of what would have been the Term of this Lease in the absence of
such reentry, will be liable to City and will pay to City, as and for liquidated and agreed damages
for Tenant's Default: The value of Compensation and amount of Additional Charges which
would be payable or provided under this Lease by Tenant if this Lease were still in effect, less
the net proceeds of any reletting, after deducting all of City's reasonable expenses in connection
with such reletting, including without limitation all reasonable repossession costs, brokerage
commissions, legal expenses, attorneys' fees, alteration costs and expenses of preparation for
such reletting.
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h.
In the event of any Default by Tenant, City will have, in addition to any specific remedies
provided in this Lease, the right to invoke any right or remedy allowed by law or in equity or by
statute or otherwise, including the right to enjoin such breach.
i.
Each right and remedy of City provided for in this Lease will be cumulative and in
addition to every other right or remedy provided for in this Lease now or hereafter existing at
law or in equity or by statute or otherwise; and the exercise or beginning of the exercise by City
of any one or more of such rights or remedies will not preclude the simultaneous or later exercise
by City of any or all other rights or remedies provided for in this Lease or now or hereafter
existing at law or in equity or by statute or otherwise.
j.
Any violation of any covenant or provision of this Lease, whether by act or omission, by
any subtenant (other than the City as a sublessee as stated in Section 3(a)(i) of this Lease) or any
other persons occupying any portion of the Property or any buildings, structures or
improvements thereon under the rights of Tenant will be deemed a violation of such provision by
Tenant and a Default under this Lease; provided, however, that any such violation will not be
deemed to be a Default under this Lease if and so long as Tenant in good faith and at its own
expense takes and diligently pursues any and all steps it is entitled to take and which steps if
completed will cure said Default and otherwise fully and timely performs all of Tenant's
obligations under this Lease.
15.
Operating Covenant
a.
Tenant covenants and agrees that Tenant will construct and operate the Improvements
contemplated by this Lease and for the remainder of the Term, it will continuously and without
interruption maintain, repair and, if necessary, replace the Improvements in a manner which
conforms to commercially reasonable management practices for comparable facilities,
("Operating Covenant"); provided, however, that the Operating Covenant will not apply during
any period when the Property or Improvements are untenantable by reason of fire or other
casualty or by eminent domain. Notwithstanding the foregoing, Tenant may request of City a
waiver of the provisions of this Section 15 if it determines that economic factors and conditions
make it impractical to comply therewith.
b.
If Tenant fails to use commercially reasonable efforts to fulfill the Operating Covenant
and such failure is not cured within the applicable cure period, then, as City's exclusive remedy
for such failure, City may terminate this Lease upon ninety (90) days prior written notice to
Tenant after which all obligations of Tenant and City under this Lease will terminate and be of
no further force and effect.
16.
Waiver of Performance
No failure by City or Tenant to insist upon the strict performance of any term or condition hereof
or to exercise any right, power or remedy consequent upon a breach thereof and no submission
by Tenant or acceptance by City of full or partial Compensation or Additional Charges during
the continuance of any such breach will constitute a waiver of any such breach or of any such
term. No waiver of any breach will affect or alter this Lease, which will continue in full force
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and effect, nor the respective rights of City or Tenant with respect to any other then existing or
subsequent breach.
17.
Remedies Cumulative
Each right, power and remedy provided for in this Lease or now or hereafter existing at law, in
equity or otherwise is cumulative and concurrent and will be in addition to every other right,
power or remedy provided for in this Lease or now or hereafter existing at law, in equity or
otherwise; and the exercise or beginning of the exercise of any one or more of the rights, powers
or remedies provided in this Lease will not preclude the simultaneous or later exercise of any or
all such other rights, powers or remedies.
18.
Title to Buildings and Improvements
a.
During the Term, title to all Improvements constructed on the Property by Tenant will be
in the name of and held by Tenant.
b.
On the expiration or sooner termination of this Lease, title to all Improvements which
constitute or are a part of the Property, exclusive of trade fixtures and personal property of
Tenant and subtenants, will (without the payment of compensation to Tenant or others) vest in
City free and clear of all claims and encumbrances on such Improvements by Tenant, and anyone
claiming under or through Tenant.
c.
The Improvements, upon termination of this Lease, will be surrendered to City in "as is"
condition. Upon request, Tenant will then quitclaim to City its possessory interest in the
Improvements. Tenant agrees to and will defend, indemnify and hold City harmless from and
against all liability and loss which may arise from the assertion of any claims and any
encumbrances on such Improvements that arose during the Lease Term; provided, however, such
duty to indemnify and hold harmless will not apply to any claims or encumbrances which are
attributable solely to the gross negligence or intentional acts or conduct of the City. Additionally,
Tenant will assign to City without representation or warranty of any kind, and City will be
entitled to the benefit of, any licenses, warranties or guarantees applicable to equipment,
systems, fixtures or personal property conveyed or otherwise transferred to, or for the benefit of,
City under this Lease. The foregoing notwithstanding, Tenant will not quitclaim its possessory
interest in the Improvements to City until such Improvements have been inspected by City and
they have been determined not to present a potential environmental hazard.
d.
This Section 18 will survive the expiration or earlier termination of this Lease.
Notwithstanding anything contained herein to the contrary, while this Lease remains in effect,
Tenant alone will be entitled to claim depreciation on the buildings, structures, improvements,
additions and alterations therein included within the Property, and all renewals and replacements
thereof, for all taxation purposes.
19.
Attorneys’ Fees
In the event City should bring suit for possession of the Property, for the recovery of any sum
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due hereunder, or for any other relief against Tenant, declaratory or otherwise, arising out of a
breach of any term or condition of this Lease, or in the event Tenant should bring any action for
any relief against City, declaratory or otherwise, arising out of this Lease, the prevailing Party
will be entitled to receive from the other Party reasonable attorneys' fees and reasonable costs
and expenses, which have accrued on the commencement of such action and will be enforceable
whether or not such action is prosecuted to judgment.
20.
Provisions Subject to Applicable Law
All rights, powers and remedies provided herein may be exercised only to the extent that the
exercise thereof does not violate any applicable law and are intended to be limited to the extent
necessary so that they will not render this Lease invalid or unenforceable under any applicable
law. If any term or condition of this Lease is held to be invalid, illegal or unenforceable or
against public policy, such provision will be deemed stricken from this Lease and the validity of
the other terms of this Lease will in no way be affected thereby and this Lease, absent the
stricken provision, will otherwise remain in full force and effect.
21.
Tenant’s Right to Cure Default(s); City’s Right to Cure Default(s)
Except as provided elsewhere herein, in the event Tenant is in default of this Lease, Tenant may
cure such default within thirty (30) days after receiving notice from the City pursuant to Section
22 below of said default. In the event the default remains uncured after the expiration of any
applicable cure period, City shall provide an additional notice of its intent to exercise any
available legal remedies, including, but not limited to, terminating this Lease. After written
notice from City of any default and of City's intent to cure such default, City may at any time,
without further notice, cure such breach for the account and require reimbursement from Tenant.
Tenant agrees to pay such reimbursement to the City without a right of appeal, and the City shall
be entitled to any sum of money it was required to pay, including any fines or penalties imposed
by any third party such as another governmental entity, or reimbursement of any expense it was
compelled to incur to return Tenant to compliance with this Agreement or applicable law,
including reasonable attorneys' fees, incurred in instituting, prosecuting or defending any actions
or proceedings to enforce City's rights under this Lease or otherwise, plus all interest, costs and
damages. Costs incurred as a result of Tenant’s default will be deemed to be Additional Charges
and will be due from Tenant to City on the first day of the month following the incurring of such
expenses or the payment of such sums.
22.
Notices
All notices, demands, requests, consents, approvals and other communications required or
permitted hereunder will be in writing and will be deemed to have been given upon personal
delivery to the respective Party, after delivery by personal service or a nationally recognized
overnight courier service (e.g., UPS, Federal Express), or within three (3) days after the same has
been mailed by registered or certified mail, postage prepaid and return receipt requested, at the
address shown below:
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The City’s Notice Address
City of Glendale
5850 West Glendale Avenue
Glendale, AZ 85301
Attention: City Manager
Email: citymanager@glendaleaz.com
With a copy to:
City of Glendale
5850 West Glendale Avenue
Glendale, AZ 85301
Attention: City Attorney
Email: mbailey@glendaleaz.com
The Tenant’s Notice Address
VAI Resorts, LLC
1830 N. 95th Avenue, Suite 114
Phoenix, Arizona 85037
Attention: President
Email: gfisher@vairesort.com
With a copy to:
VAI Resorts, LLC
1830 N. 95th Avenue, Suite 114
Phoenix, Arizona 85037
Attention: Legal Department
Email: lpicini@vairesort.com
or at such other address as either Party may from time to time designate in writing to the other.
23.
Warranties of the Parties
a.
City hereby makes the following representations and warranties, each of which is: (i)
material and is being relied upon by Tenant in entering into this Lease; and (ii) true in all
respects as of the date hereof:
1.
City owns the real property included within the Property.
2.
City has the full right, power and authority to enter into and perform City's
obligations pursuant to this Lease and to lease the real property included within the
Property to Tenant in the manner contemplated in this Lease subject only to the consent
and approval of the Glendale City Council.
3.
Except as otherwise disclosed in this Lease, no other person or entity other than
Tenant has a right to possession of all or any part of the real property included within the
Property.
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4.
To the extent of City's actual knowledge, this Lease does not violate any contract,
agreement or instrument to which City is a party, or is otherwise subject.
5.
No third party has any option or preferential right to purchase all or any part of
the Property.
6.
City has not received or given any written notice that the Property or the
operations thereon are in violation of any governmental law or regulation, including,
without limitation, any Hazardous Materials Laws or the Americans with Disabilities
Act, nor· is City aware of any such violation.
For the purposes of this subsection a, the actual knowledge of City will be and mean the actual
knowledge, without further duty of inquiry, of the City Manager of the City of Glendale.
b.
Upon Tenant performing all covenants of this Lease to be performed by Tenant, Tenant
will have quiet, exclusive and undisturbed use, possession and enjoyment of the Property,
together with all appurtenances thereto without hindrance or ejection by any person lawfully
claiming by, through or under City.
c.
Tenant hereby makes the following representations and warranties to City, each of which
is: (i) material and is being relied upon by City in entering into this Lease, and (ii) true in all
respects as of the date hereof:
1.
Tenant is a duly formed and validly existing limited liability company,
formed under the laws of the State of Arizona.
2.
Tenant has the full right, power and authority to enter into and perform
Tenant's obligations pursuant to this Lease and to lease the real property legally
described in Section 1 herein from City in the manner contemplated in this
Lease.
3.
To the extent of Tenant's actual knowledge, neither this Lease nor Tenant's
contemplated use of the Property, as contemplated by this Lease, violates any
contract, agreement or instrument to which Tenant is a party, or is otherwise
subject.
For the purposes of this subsection c, the actual knowledge of Tenant will be and mean the actual
knowledge, without further duty of inquiry, of LLC Member Tommy Fisher of Tenant.
24.
Unsubordinated Lease
This is an unsubordinated lease. City is not and will not be obligated to subordinate its rights and
ownership interest in the real property included within the Property to any loan, encumbrance or
other lien that Tenant may place against Tenant's leasehold interest.
25.
Estoppel Certificate
City or Tenant, as the case may be, will execute, acknowledge and deliver to the other, within
fifteen (15) days following request therefor, a written certificate in a recordable form certifying
(a) that this Lease is in full force and effect without modification except as to those specified in
said certificate, and (b) the dates, if any, by which Compensation, Additional Charges and other
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sums payable hereunder have been paid and/or provided, (c) that no notice has been received by
City or Tenant of any default which has not been cured, except as to defaults specified in said
certificate, and (d) any other matters as may be reasonably so requested. Any such certificate
may be relied upon by any prospective purchaser, assignee, subtenant or encumbrancer of the
Property or any part thereof. Either Party's failure to deliver such certificate within the time
permitted hereby will be conclusive upon such Party that this Lease is in full force and affect,
except to the extent any modification has been represented by the requesting Party, and that there
are no uncured defaults in such Party's performance.
26.
Cooperation
To further the cooperation of the Parties in implementing the provisions of this Lease, City and
Tenant each will designate and appoint a representative to act as a liaison between the City and
its various departments and Tenant. The initial representative for City (the "City Representative")
will be the Jayme Chapin; and the initial representative for the Tenant (the "Tenant
Representative") will be Tommy Fisher. The representatives will be available at all reasonable
times to discuss and review the performance of the Parties to this Lease and the development,
construction, operation and maintenance of the Property and Improvements.
27.
Memorandum of Recording
Within ten (10) days after the Effective Date of this Lease, City and Tenant will execute and
cause to be recorded with the Maricopa County Recorder's Office, and any other public or
private official, a copy of this Lease.
28.
Parties Bound
This Lease will be binding upon and inure to the benefit of and be enforceable by the Parties
hereto, their personal representatives, their respective successors in office and permitted assigns
of the Parties hereto for the entire Term of this Lease.
29.
Time of the Essence
Time is declared to be of the essence of this Lease.
30.
Section Headings; Interpretation
The section headings contained in this Lease are for purposes of convenience and reference only
and will not limit, describe or define the meaning, scope or intent of any of the terms or -
provisions hereof. All grammatical usage herein will be deemed to refer to the masculine,
feminine, neuter, singular or plural as the context may require. If the last day of any time period
stated herein falls on a Friday, Saturday, Sunday or legal holiday in the State of Arizona, then the
duration of such time period will be extended to the next succeeding day which is not a Saturday,
Sunday or legal holiday in the State of Arizona.
31.
Severability
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If any provision of this Lease is declared void, unenforceable or against public policy, such
provision will be deemed stricken and severed from this Lease, with the remainder of the Lease
to remain in full force and effect.
32.
Governing Law and Choice of Forum
This Lease will be governed by and construed in accordance with the substantive laws of the
State of Arizona without giving effect to the principles of conflict of laws. Any action brought to
interpret, enforce or construe any provision of this Lease will be commenced and maintained
solely and exclusively in the Superior Court of Maricopa County, Arizona (or, as may be
appropriate, in the Justice Courts of Maricopa County or in the United States District Court for
the District of Arizona if, and only if, the Maricopa County Superior Court lacks or declines
jurisdiction over such action).
33.
No Warranties
Tenant acknowledges and covenants to City that it has made a complete investigation of the real
property included within the Property, the surface and sub-surface conditions thereof, the present
and proposed uses thereof, and agrees to accept all the same "as is". Tenant further agrees that,
except as expressly provided herein, no representation or warranty, expressed or implied, in fact
or by law, has been made by City or anyone else, as to any matter, fact, condition, prospect or
anything else of any kind or nature.
34.
Brokers and Agents
Each party represents and warrants to the other that such party has had no dealings or discussions
with any broker or agent (licensed or otherwise) in connection with this Lease and each party
covenants to pay, hold harmless and indemnify the other party from and against any and all
losses, liabilities, damages, costs and expenses (including reasonable legal fees) arising out of or
in connection with any breach of this representation and warranty.
35.
Consent and Approval
Except as otherwise expressly provided herein, any consent or approval required in this Lease
will not be unreasonably withheld, conditioned or delayed, and if neither approval nor rejection
is given within a time period specified in this Lease as to any particular approval which may be
requested by one party of the other (or, if no such time is specified, then within thirty (30) days
after request for approval is given by a Notice), then the approval thus requested will be
conclusively and irrevocably deemed to have been given. The requesting Party will be entitled to
seek specific performance at law and will have such other remedies as are reserved to it under
this Lease, but in no event will City or Tenant be responsible for damages to anyone for such
failure to give consent or approval. Notwithstanding the foregoing rights and obligations under
this Section, nothing herein applies to any consent and approval sought from the Glendale City
Council.
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36.
Delay in Performance
Any prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts of God, inability
to obtain labor or materials or reasonable substitutes therefor, governmental restrictions,
governmental regulations, governmental controls, enemy or hostile governmental action, civil
commotion, fire or other casualty, acts of terrorism, and other causes entirely beyond the control
of the Party obligated to perform, will excuse the performance by such Party for a period equal to
any such prevention, delay or stoppage, except the obligations imposed with regard to rental and
other monies to be paid by Tenant pursuant to this Lease.
37.
Relationship of the Parties
This is a ground lease. This Lease will not be construed as creating a joint venture, partnership or
any other cooperative or joint arrangement between City and Tenant, and it will be construed
strictly in accordance with its terms and conditions. Nothing contained herein is intended to
confer a benefit upon any third parties.
38.
Lease Amendment
This Lease may be amended only upon written agreement by the Parties. In the event a Party
wishes to amend one or more provisions of this Lease, it will make a written request to the other
Party setting forth the nature of the request. In the event the Parties agree upon the terms of the
proposed Lease modifications, City's approval of any proposed amendments will be subject to its
City Council's review and approval.
39.
Further Instruments and Documents
City and Tenant will, upon request from the other, promptly acknowledge and deliver to the
other all further documents, instruments or assurances reasonably requested or appropriate to
evidence or give effect to the provisions of this Lease.
40.
Integration Clause; No Oral Modificaiton
This Lease is the result of arms-length negotiations between parties of roughly equivalent
bargaining power and represents the entire agreement of the Parties with respect to its subject
matter, and all previous agreements, whether oral or written, entered into prior to this Lease are
hereby revoked and superseded by this Lease. This Lease will not be construed for or against
either Party as a result of its participation, or the participation of its counsel, in the preparation
and/or drafting of this Lease or of any exhibits or documents prepared to carry out the intent of
this Lease. No representations, warranties, inducements or oral agreements have been made by
any of the Parties except as expressly set forth herein, or in any other contemporaneous written
agreement executed for the purposes of carrying out the provisions of this Lease. This Lease may
not be changed, modified or rescinded, except as provided for herein, absent a written agreement
signed by City and Tenant. Any attempt at oral modification of this Lease will be void and of no
effect.
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41.
Counterparts
This Lease may be executed in any number of counterparts, each of which will be deemed to be
an original and all of which together will comprise but a single instrument.
42.
Conflict of Interest
The Parties acknowledge this Agreement is subject to A.R.S. § 38-511, which allows for
cancellation of this Agreement in the event any person who is significantly involved in initiating,
negotiating, securing, drafting, or creating this Lease on City's behalf is also an employee, agent,
or consultant of any other party to this Lease.
43.
No Boycott of Israel
To the extent A.R.S § 35-393 through § 35-393.03 are applicable, the parties hereby certify that
they are not currently engaged in, and agree for the duration of this Lease to not engage in, a
boycott of goods or services from Israel, as that term is defined in A.R.S § 35-393.
44.
Uyghur Forced Labor Prevention Act (UFLPA)
Tenant certifies that it does not currently, and during the term of this Agreement, will not use:
(a)
the forced labor of ethnic Uyghurs in the People’s Republic of China;
(b)
any goods or services produced by the forced labor of ethnic Uyghurs in the
People’s Republic of China; and
(c)
any contractors, subcontractors or suppliers that use the forced labor or any goods
or services produced by the forced labor of ethnic Uyghurs in the People’s
Republic of China.
45.
E-verify, Records and Audits
To the extent applicable under A.R.S. § 41-4401, Tenant warrants its compliance and that of its
contractors and subcontractor with all federal immigration laws and regulations that relate to
their employees and compliance with the E-verify requirements under A.R.S. § 23-214(A). The
Tenant or its contractors and subcontractor’s breach of this warranty shall be deemed a material
breach of the Agreement and may result in the termination of the Lease by the City as a Tenant
Default. The City retains the legal right to randomly inspect the papers and records of the Tenant
or any party performing obligations under the Lease on its behalf to ensure that Tenant or the
third party is complying with the above-mentioned warranty. Tenant, its contractor(s) and
subcontractor(s) warrant to keep their respective papers and records open for random inspection
during normal business hours by the City. These entities shall cooperate with the City’s random
inspections, including granting the inspecting party entry rights onto their respective properties
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to perform the random inspections and waiving their respective rights to keep such papers and
records confidential.
46.
Non-Discrimination
Tenant must not discriminate against any employee or applicant for employment on the basis of
race, color, religion, sex, national origin, age, marital status, sexual orientation, gender identity
or expression, genetic characteristics, familial status, U.S. military veteran status or any
disability. Tenant will require any contractor or subcontractor performing services related to this
Lease to comply with and be bound by the requirements contained in this section. Tenant, on
behalf of any contractors and subcontractors, warrants compliance with this section.
47.
Lack of Appropriations
Nothing in this Agreement guarantees that some or all of the funds necessary to comply with all
of the City’s obligations under this Lease will be appropriated or otherwise be available. The
City agrees to seek such appropriations in good faith from the City Council and agrees not to use
the lack of appropriation as a substitute for termination for convenience. If sufficient funds are
not appropriated or otherwise available, the City may unilaterally terminate this Lease after
providing thirty (30) days written notice pursuant to Section 22. In the event the City provides
such notice, the City will not be entitled to a refund or offset of any compensation previously
provided but will not obtain any benefits under this Lease after providing such notice.
48.
Preservation of State Shared Revenue
Notwithstanding any other provision of, or limitation in, this Agreement to the contrary, if
pursuant to A.R.S. § 41-194.01 the Attorney General determines that this Agreement violates
any provision of state law or the Constitution of Arizona (including but not limited to A.R.S. §
42-6201 et seq.), City and Tenant shall use all and best faith efforts to modify the Lease so as to
fulfill each Parties obligations in the Agreement while resolving the violation with the Attorney
General. If within thirty (30) days of notice from the Attorney General pursuant to and under the
provisions of A.R.S. § 41- 194.01(B)(1), City and Tenant cannot agree to modify this Agreement
so as to resolve the violation with the Attorney General, this Agreement shall automatically
terminate at midnight on the thirtieth (30th) day after receiving such notice from the Attorney
General, and upon such termination the Parties shall have no further obligations under this
Agreement. Additionally, if the Attorney General determines that this Agreement may violate a
provision of state law or the Constitution of Arizona under A.R.S. § 41-194.01(B)(2), and
requires the posting of a bond under A.R.S. § 41-194.01(8)(2), City shall be entitled to terminate
this Agreement, except if Tenant posts such bond, if required; and provided further, that if the
Arizona Supreme Court, determines that this Agreement violates any provision of state law or
the Constitution of Arizona, City may terminate this Agreement and the Parties shall have no
further rights, interests or obligations in this Agreement or claim against the other Party for a
breach or default under this Agreement.
49.
Right to Terminate for Actions of Third Parties
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a.
Either Party may, in its sole unreviewable discretion, elect to terminate this Lease
in the event a third party initiates litigation or an initiative, referendum or recall petition
challenging the VAI Resort or this Lease or seeking to void any or all of its terms and conditions.
For purposes of this provision, “initiate” means: (i) filing a Complaint seeking monetary or
injunctive relief in a court of competent jurisdiction; or (ii) filing a Complaint or similar action to
begin an investigation or enforcement proceeding with any administrative or governmental entity
such as, but not limited to, the Arizona Attorney General’s Office, the Arizona Department of
Environmental Quality, the Industrial Commission, the Arizona Corporation Commission, the
Arizona Department of Revenue, the United States Treasury, U.S. Department of Justice, U.S.
Department of Labor, or Environmental Protection Agency; of (iii) filing an initiative,
referendum, or recall petition with the applicable governmental agency.
b.
Termination of this Lease will not become effective until the Party electing to terminate
has provided the requisite Notice in accordance with Section 22 herein. The non-electing party
shall have no right to cure any issue or matter alleged or relied upon by the third party in
asserting its challenge or objection to this Lease.
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IN WITNESS WHEREOF, the Parties hereto have entered into this Lease as of the date set forth
above.
LESSOR:
CITY OF GLENDALE, an Arizona municipal corporation
By: __________________________________________
Its: __________________________________________
__________________
Date
ATTEST:
_____________________________
Julie K. Bower
City Clerk
APPROVED AS TO FORM:
_____________________________
Michael D. Bailey
City Attorney
LESSEE:
VAI RESORTS, LLC, an Arizona limited liability
company
By: ___________________________________
Its: ___________________________________
__________________
Date