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Home My WebLink AboutDIA - October 16, 2007DEVELOPMENT IMPROVEMENT AGREEMENT by and between the TOWN OF VAIL, COLORADO, a Colorado home rule town, and OHP VAIL ONE, LLC, a limited liability company organized under the laws of the State of Delaware Dated as of October 16, 2007 It, TABLE OF CONTENTS ARTICLE I DEFINITIONS 3 Section 1.01 Internal References . 3 Section 1.02 Specific Terms . 3 03 tion 1 S Other Definitions 13 . ec Section 1.04 Rules of Construction. 13 Section 1.05 Exhibits 13 ARTICLE II PROJECT DESCRIPTION 14 Section 2.01 Selection and Engagement 14 Section 2.02 Description of Project 14 Section 2.03 Schedule of Conveyance of Title and Interests in Project 16 Section 2.04 Operation and Maintenance of Improvements 17 Section 2.05 Development Terms 18 Section 2.06 Vested Property Rights 18 ARTICLE III PLANNING AND ENTITLEMENT PERIOD 19 Section 3.01 Term 19 Section 3.02 Site Investigation, Entitlements, and Design 19 Section 3.03 License to Enter and Access 20 Section 3.04 Title Commitment 20 Section 3.05 Survey 21 Section 3.06 Lionshead Redevelopment Master Plan Amendment 21 Section 3.07 Zoning Process and Entitlement Activities 21 Section 3.08 Project Plan 21 Section 3.09 Town Obligations During Planning and Entitlement Period 22 Section 3.10 Developer Obligations During Planning and Entitlement Period........... 23 Section 3.11 Employee Housing 24 Section 3.12 Indemnification 24 Section 3.13 Extension of Planning and Entitlement Period 24 ARTICLE IV ESCROW DELIVERY, CONVEYANCE OF SITE AND FINAL CLOSING.... 25 Section 4.01 Escrow Delivery; Final Closing 25 Section 4.02 Conveyance Price 25 Section 4.03 Escrow Delivery Conditions 25 Section 4.04 Certificates at Escrow Delivery 27 Section 4.05 Parties Option to Extend Escrow Delivery or to Terminate 28 Section 4.06 Escrow Delivery 28 Section 4.07 Final Closing 28 Section 4.08 Title 29 ARTICLE V CONSTRUCTION 29 Section 5.01 Generally 29 Section 5.02 Construction of the New Parking Structure and Parking Related Infrastructure 30 i Section 5.03 Construction of Non-Parking Infrastructure Section 5.04 No Expense to Town. . ARTICLE 32 ARTICLE VI CONFERENCE CENTER. 34 Section 6.01 General 34 Section 6.02 Ownership and Operatio 34 Section 6.03 Conference Center Board 35 Section 6.04 Conference Center Services 36 ARTICLE VII FINANCING Section 7.01 General.......... 36 ~ Section 7.02 Metropolitan District(s) . 36 Section 7.03 Supplemental Financing 36 Section 7.04 Holder Not Obligated to ••.."rt~..••••.•.....••.•......•.•• 37 Section 7.05 Copy of Notice of DefaulC to stct. 37 Section 7.06 Holder Holder. Section 7.07 Rights Option to Cure Interested 38 of Lenders and Parties. Section 7.08 Miscellaneous............ 38 38 ARTICLE VIII LETTER OF CREDIT Section 8.01 New Parking Structure 39 Section 8.02 Garage LOC Characteristic Letter of Credit 39 Section 8.03 Drawing on the Garage 1.OC....•.• 39 Section 8.04 Termination of Garage LOC 39 40 ARTICLE IX TOWN OBLIGATIONS A.ND COVENANTS Section 9.01 Town Obligations After Escrow Delivery Section 9.02 Covenant to Maintain Improvements 40 . 41 ARTICLE X DEVELOPER OBLIGATIONS AND COVENANTS......... S41 ection 10.01 Developer Obligations After Escrow Delivery Section 10.02 Covenant to Maintain Private Improvements * 41 Section 10.03 Plans Reports, Studies and 42 Investigations.. . 42 Section 10.04 Commencement and Completion of Construction. . Section 10.05 Developer's Affiliates 43 ARTICLE XI REPRESENTATIONS, AND WARRANTIES 43 Section 11.01 Developer Representations and 43 Section 11.02 Warranties 43 Town Representations and Warranties ARTICLE XII GENERAL COVENANTS, INDEMNITY AND RESPONSIBILITY 46 Section 12.01 Cooperation. Section 12.02 Anti-Discrimination in Employm .....ent 47 Section 12.03 Construction of the Project Section 12.04 Vacation and Dedication of Rights of 47 Section 12.05 of Way 47 Town's Responsibility. Section 12.06 Notification of Claim 47 47 ii I 07 Developer's Indemnification 12 ti S 48 . on ec Section 12.08 Town's Indemnification Section 12.09 No Waiver of Governmental Immunity 448 8 ARTICLE XM INSURANCE REQUIREMENTS 48 Section 13.01 Insurance Required From Effective Date to Final Closing Date 48 Section 13.02 Insurance Required From Closing Date to Date of Project Final Completion 50 Section 13.03 General Insurance Requirements 51 ARTICLE XIV EVENTS OF DEFAULT, REMEDIES AND TERMINATION 53 Section 14.01 Events of Default After Escrow Delivery Date 53 02 Section 14 Default Notice. 53 . Section 14.03 Town's Option to Reenter and Repossess Portions of the Project.......... 53 Section 14.04 Developer's Remedies 55 Section 14.05 Termination by the Town Prior to Escrow Delivery Date 55 Section 14.06 Termination by Developer Prior to Escrow Delivery Date 56 Section 14.07 Option to Terminate 56 Section 14.08 Action to Terminate 56 56 Section 14.09 Effect of Termination 56 Section 14.10 Scheduled Termination Section 14.11 Survival After Termination 57 ARTICLE XV RESTRICTIONS ON ASSIGNMENT AND TRANSFER 5? resentations as to Development 01 Re tion 15 S 57 p . ec 02 Limitation on Assignment tion 15 S 57 . ec Section 15.03 Effect Upon Obligations 58 58 TICLE XVI MISCELLANEOUS AR Section 16.01 Section 16.02 Section 16.03 04 16 ti S Amendment of Agreement No Implied Waiver Notices Waiver 58 58 58 59 . on ec Section 16.05 06 ction 16 S Attorneys' Fees Conflicts of Interest 59 60 . e 07 ction 16 S Titles of Sections 60 . e Section 16.08 Section 16.09 Section 16.10 11 16 S ti Town Not a Partner; Developer Not Town's Agent Applicable Law; Venue Binding Effect. Further Assurances 60 60 60 60 . on ec Section 16.12 Section 16.13 Section 16.14 Section 16.15 Section 16.16 Section 16.17 Section 16.18 Severability Good Faith; Consent or Approval Counterparts Non-Liability of Town Officials and Employees Incorporation of Exhibits Jointly Drafted; Rules of Construction Brokers 60 61 61 661 1 61 61 iii Section 16.19 Non-Discrimination Section 16.20 Confidentiality of Materials........... 61 Section 16.21 Effectiveness: Complete Understanding......... 62 Section 16.22 Time of the Essence. 62 Section 16.23 Covenants Running With the Land 62 Section 16.24 Recording 63 63 EXHIBIT A Site Description EXHIBIT B Site Map EXHIBIT C Project Description (Exhibit C is not attached hereto because of its size and is on file at the Office of the Town Manager) EXHIBIT C-1 Proposal EXHIBIT C-2 Supplement EXHIBIT C-3 Traffic Patterns and Parking Program EXHIBIT D Conference Center Summary iv DEVELOPMENT IMPROVEMENT AGREEMENT THIS DEVELOPMENT IMPROVEMENT AGREEMENT is dated as of October 16, 2007 (the "Effective Date"), and is entered into by and between the TOWN OF VAIL, COLORADO, a Colorado home rule town, with offices at 75 South Frontage Road, Vail, Colorado 81657 (the "Town") and OHP VAIL ONE, LLC, a limited liability company organized under the laws of the State of Delaware ("Developer"), located at 2525 McKinnon Street, Suite 750, D:_'as, Texas 75201, upon the terms and conditions set forth below. The Town and Developer may be referred to hereinafter collectively as the "Parties" and each individually a~ a Recitals Capitalized terms used in these Recitals have the meanings set forth in Section 1.02 of this Agreement. This Agreement is made with respect to the following facts: A. The Town is the owner of certain real property commonly referred to as the Lionshead Parking Structure and an unimproved charter bus parking lot located in the Town of Vail, Colorado at 395 South Frontage Road, as legally described on Exhibit A hereto (collectively, the The Site is owned by the Town and consists of approximately 6.6 acres, on which the Town currently operates a 1,150 space public parking structure. The Site is legally described on Exhibit A hereto, which is made a part hereof, and is as depicted on the "Site Map," attached as Exhibit B hereto, which is made apart hereof. The Site is located within the "Lionshead Master Plan study area" identified in the Lionshead Redevelopment Master Plan (as defined herein). B. On May 10, 2006, the Town issued its "Request for Proposals: To redevelop existing parking structure in Vail, Colorado as a mixed use development providing over 1,150 public parking spaces" (the "RFP') for the potential mixed-use redevelopment of the Site. Developer was one of two entities to respond. to the RFP. The Developer's RFP response included those documents attached hereto as Exhibits C-1 and C-2 (the "RFP Response"). As the result of this process, on March 13, 2007, the Town Council authorized the staff to begin a 120 day period of exclusive negotiations with Developer for the redevelopment of the Site. C. The Town, in preparing the RFP, identified certain goals and concepts for the Site, including, but not limited to the following: (i) the existing parking structure needs both capital and operational improvements and the Town needs an additional 400-500 additional public parking spaces to minimize overflow parking on South Frontage Road to 15 days per winter season; (ii) the redevelopment of the Site should include retail on the south side, as called for in the Lionshead Redevelopment Master Plan, and pedestrian, transit, and vehicular circulation needs to be improved between the Site and the Lionshead retail area; (iii) the Lionshead information center needs to be improved; (iv) the Town has a strong preference for active lodging uses that encourage short-term stays, especially during off-season months; (v) the need for development of meeting/event/conference facilities accessory to hotel and lodging uses; (vi) the need to provide loading and delivery for uses created on the Site, which can also be use by adjacent Lionshead retail uses; (vii) the need for siting a Lionshead transit facility on the Site to accommodate 5 buses for regional bus traffic; and (viii) the need to make South Frontage Road improvements consistent with the Lionshead Redevelopment Master Plan and acceptable to the Town and the Colorado Department of Transportation. D. As proposed by the Developer, the Project will address the several components above and identified by the Town in the RFP. The RFP Response proposed: (i) replacement of the current parking facility with a new parking facility having approximately 1,450 public parking spaces, plus additional parking as may be required by the Zoning Regulations in order to support the uses in (ii) through (ix) of this paragraph; (ii) a retail oriented pedestrian street; (iii) a fully integrated transportation center with 5 ECO Bus/ Town Shuttle Bus bays and local day skier drop-offs; (iv) a conference center; (v) a new roundabout and frontage road improvements; (vi) a new Town information center; (vii) on-site replacement of certain facilities currently located in the Existing Garage (as defined herein); (viii) two neW Hotels, with no less than 240 guest rooms, no more than 130 residential units, and no less than 25 fractional fee units allocated between the two hotels; and (ix) approximately 60,000 square feet of retail space. A current detailed project description is incorporated by reference as if it were attached as Exhibit C. E. The Parties intend that the new parking structure (with the exception of approximately 300 privately owned parking spaces related to the hotels, condominium units and fractional fee units), the transit center, the information center and certain road improvements will be owned, operated and maintained by the Town, but will be constructed by the Developer at the Developer's expense. The Parties presently expect that the conference center will be owned, operated and maintained by a metropolitan district, but will be constructed by the Developer for the metropolitan district at the Developer's expense, which may be reimbursed by the metropolitan district. The Parties intend that the retail space, hotels, residential and fractional fee units will be owned, operated and maintained by Developer, and will be constructed by the Developer at the Developer's expense. F. In consideration of Developer's commitment to have the Public Improvements and Private Improvements (as each is defined herein) constructed pursuant to this Agreement, and in consideration of Developer's other obligations hereunder, Town is willing to convey to Developer the Town's legal interest in the development areas where the Private Improvements will be constructed and the Town's legal interest in the development area where the Private Parking will be constructed. G. The Parties now desire to enter into this Agreement to set forth the rights, obligations and method of participation of the Parties with respect to the development of the Project (as defined herein) on the Site. Agreement NOW, THEREFORE, in consideration of the covenants and agreements of the Parties as hereinafter set forth, and for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged by each Party hereto, the Parties agree as follows: 2 ARTICLE I DEFINITIONS Section 1.01 Internal References. Unless otherwise stated, references in this Agreement to Sections, subsections, or Exhibits are to this Agreement. Section 1.02 Specific Terms. As used herein, the following terms shall have the following meanings: "Affiliate" or "affiliate" means, with respect to Developer, (i) any other Person, which, directly or indirectly, controls or is controlled by, or is under common control with, Developer ("control," including with correlative meanings, the terms "controlled by" and "under common control with," shall have the meaning given to the term "Control" in this Section 1.02) and (ii) as applicable, any investment funds or vehicles, however organized, owned or managed by Developer or any of its Affiliates. "Agreement" means this Development Improvement Agreement including the exhibits attached hereto, as such Agreement may be amended or supplemented from time to time in writing by the Parties. "Approved Development Plan" means one or more official development plan(s) (individually or collectively) for the Site, which shall have been approved by the DRB, PEC and/or the Town Council on or before the Escrow Delivery Date in accordance with the Town Code and the terms and conditions of this Agreement. The Approved Development Plan will establish the development areas, parcels, land use entitlements for the uses, density and intensity of development, building footprints and elevations, design standards, and other development terms and conditions for the Project. The Parties acknowledge that the Approved Development Plan will include design standards that meet or exceed. site planning and design criteria of the Town and that have been mutually agreed to by the Parties during the Town's planning, permitting and zoning process. "Approved Uses" means those land use entitlements, improvements and uses thereof, which are in accordance with the Lionshead mixed use 1 (LMU-1) district, set forth in Title 12, Chapter 7, Article H of the Town Code, as the same may be amended in accordance with the terms and conditions of this Agreement and the Town Code. "Business Day" means any day that is not a Saturday, Sunday or federal or State holiday. "CDOT" means the Colorado Department of Transportation. "Colorado Open Records Act" means Title 24, Article 72, Sections 101 through 309 of the Colorado Revised Statutes, as the same may be amended from time to time. "Commencement of Construction" means, with respect to any phase of the Project or portion thereof, Developer's commencement of physical construction, including demolition, significant site grading or preparation of the Improvements to be constructed by Developer in such phase or portion thereof with the intention to continue the work until such Improvements are completed. 3 "Conference Center" means a conference center with approximately 34,000 total gross square feet of ballroom, breakout, pre-function and "back of house" space, as may be amended and supplemented pursuant to the Conference Center Agreement. The Conference Center is a Public Improvement. "Conference Center Agreement" shall have the meaning given to it in Section 6.02(b) of this Agreement. "Conference Center Board" shall have the meaning given to it in Section 6.03 of this Agreement. "Construction Contractors" means any contractors or subcontractors with whom Developer enters into a Construction Contract to perform work on the Site or Project. "Construction Contracts" means any agreements entered into between Developer and any Construction Contractor that set forth terms governing construction on the Site or Project. "Construction Phase" means, if Final Closing has occurred, a period of time beginning on the Business Day following the Final Closing Date and ending on the Date of Project Final Completion, during which development and construction of the Project will occur. "Control" means, for any Person other than the Town, (i) the legal or beneficial ownership of more than fifty percent (50%) of the voting stock, limited liability company membership interests, partnership interests, capital or profits of the Person in question; or (ii) the possession, directly or indirectly, of the right or ability, whether or not exercised, to direct or cause the direction of the management and policies of the Person in question, whether through the ownership of voting stock, limited liability company membership interests, partnership interests, capital or profits or by contract or otherwise. A Person shall be deemed to control another person if such Persons are under common control. Two (2) or more Persons shall be under common control if fifty percent (50%) or more of the capital, voting or profit interests in each Person are held by a single Person or a single group of two (2) or more Persons. "Control District" shall have the meaning given to it in Section 7.02(d) of this Agreement. "Conveyance Price" shall have the meaning set forth in Section 4.02 of this Agreement. "County" means the county of Eagle, Colorado. "Date of New Parking Structure Final Completion'' means with respect to the New Parking Structure and the Parking Related Infrastructure, the completion by Developer or its Construction Contractors of all or substantially all of the New Parking Structure and Parking Related Infrastructure Improvements, including Phase I, Phase II and Phase III, to be constructed or performed in accordance with this Agreement, and when applicable, the receipt of a certificate of occupancy from the Town. The Parties intend for the Date of New Parking Structure Final Completion to be September 1, 2013, as such date may be extended in accordance with the terms hereof. 4 "Date of Project Final Completion" means the date on which both the Date of New Parking Structure Final Completion and the Date of Remaining Project Components Final Completion have occurred. "Date of Remaining Project Components Final Completion" means with respect to the Remaining Project Components, the completion of construction by Developer or its Construction Contractors of u1 or substantially all of the Improvements to the Remaining Project Components, to be constructed or performed in accordance with this Agreement, and when applicable, the receipt of a certificate of occupancy for all of the Remaining Project Components from the Town. The Date of Remaining Project Components Final Completion will not be more than 365 days after the date on which the last Remaining Project Components TCO is received. "Day" or "day", when used without modification, means any day of the week, whether or not a Business Day. "Deed Restriction Agreement' 'means a binding agreement or contract between the Town and Vail Associates to remove the deed restriction held by Vail Associates on the Site in a timely manner, which contract or agreement shall be acceptable to Developer in form and substance, provided such acceptance shall not be unreasonably withheld. "Default Notice" shall have the meaning given to it in Section 14.02 of this Agreement. "Developer" shall have the meaning given to it in the opening paragraph of this Agreement. "Developer's Certificate" means the certificate delivered to the Town by the Developer at Escrow Delivery, which states that all of the representations and warranties of the Developer made in this Agreement are true and correct as of the Escrow Delivery Date as if made on the Escrow Delivery Date, and that the Developer has satisfied each of the Escrow Delivery Conditions set forth in Sections 4.03(u) through 4.03(x) of this Agreement. "Developer's Costs" shall have the meaning given to it in Section 14.04 of this Agreement. "Developer's Proprietary Information" means the following information of Developer, and its Affiliates and marked as such: (i) know-how and trade secrets; (ii) information reasonably identified by Developer or its Affiliates from time to time as confidential; (iii) personnel information; (iv) information that should be treated as confidential under the circumstances surrounding its disclosure including sales and marketing information and account information; and (v) information which could cause competitive harm to Developer or any of its Affiliates relating to other projects of Developer or its Affiliates, and other proprietary information relative to the operating methods, procedures and policies distinctive to other projects of Developer or its Affiliates, including without limitation, the contents of the Developer's operating manuals, and all commercial or financial information (including without limitation, all expenses, calculations and apportionments) relating thereto. "Development Parcel" means the development area and air-rights outside and above the Public Parking Structure Parcel, which shall have been subdivided into separate and distinct i parcels in order to facilitate future conveyance and ownership (each to be identified as a separate tax parcel), where the Lodging and Conference Center will be constructed. "DRB" means the Design Review Board of the Town. "Effective Date" means the date set forth in the opening paragraph of this Agreement. "Environmental Laws" means all federal, State and local environmental, health and safety statutes, as may from time to time be in effect, including but not limited to the Resource Conservation and Recovery Act (as amended by the Hazardous and Solid Waste Amendments of 1984), 42 U.S.C. § 6901, et seq.; the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (as amended by the Superfund Amendments and Reauthorization Act of 1986), 42 U.S.C. § 9601, et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. § 1801, et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq.; the Clean Air Act, 42 U.S.C. § 7401, et seq.; the Safe Drinking Water Act, 42 U.S.C. § 300h, et seq.; the Clean Water Act, 33 U.S.C. § 1251, et seq.; all applicable State counterparts to such federal legislation and any regulations, guidelines, directives or other interpretations of any such enactment, all as amended from time to time, or any other applicable State or federal environmental protection law or regulation. "Escrow Delivery" means the occurrence of the Parties having met each of the Escrow Delivery Conditions, and having provided documentation and evidence thereof] which Escrow Delivery shall occur on the Escrow Delivery Date. "Escrow Delivery Conditions" means the conditions for Escrow Delivery set forth in Section 4.03 of this Agreement. "Escrow Delivery Date" means the date on which Escrow Delivery occurs. The Parties intend for the Escrow Delivery Date, prior to any extensions, to occur on the last day of the calendar month that is twenty-four months from the Effective Date; provided, however, that such date may be extended pursuant to Sections 3.13 or Section 4.05 of this Agreement, or may occur on such other date to which the Developer and the Town may agree in writing. "Event of Default" shall have the meaning given to it in Article XIV of this Agreement. "Existing Garage" means the current 1,150 space parking structure, owned and operated by the Town, located at 395 South Frontage Road, Vail, Colorado. "Final Closing" means the occurrence of the Parties having met the requirements set forth in Section 4.07 hereof, and having provided documentation and evidence thereof, which Final Closing shall occur on the Final Closing Date. "Final Closing Date" means the date on which Final Closing occurs. As of the Effective Date the Parties intend for the Final Closing Date, prior to any extensions, to occur on February 1, 2010; provided, however, that such date may be extended pursuant to Section 3.13 or Section 4.05 of this Agreement, or may occur on such other date to which the Developer and the Town may agree in writing. 6 "Finance Plan" means the Developer's plan which shall set forth the proposed financing structure of the Project in amounts sufficient to complete the Site Investigation, develop or cause the construction of the Public Improvements and Private Improvements and otherwise perform Developer's obligations under this Agreement, which shall be reviewed and confirmed for sufficiency by the Finance Plan Consultant. Nothing in the Finance Plan shall adversely affect the Town's legal interest in the Public Improvements. To the extent the Finance Plan contains information or documents that are proprietary in nature or represent Developer's Proprietary Information or other confidential commercial and financial information, it is the intent of the Parties that such information and documents be deemed confidential and not be available as public records under the Colorado Open Records Act. "Finance Plan Consultant" means an independent, third-party professional, who is experienced and knowledgeable regarding project development finance and public finance, who shall review and confirm the sufficiency of the Finance Plan and who shall be appointed by Developer and consented to by the Town, with such consent not to be unreasonably withheld. "Force Majeure" means any of the following occurrences if beyond the reasonable control of the Person in question (but specifically excluding causes related to the delayed Party's financial condition unless the delayed Party's financial condition is related to one of the following reasons)): (i) strike, lock-out or other labor troubles; (ii) governmental restrictions or limitations, including, without limitation, the requirements, restrictions or limitations of environmental laws; (iii) failure or shortage of electrical power, materials, gas, water, fuel oil, or other utility or service; (iv) riot, war, terrorist act, insurrection or other national or local emergency; (v) accident, flood, fire or other casualty; (vi) extraordinarily adverse weather conditions; (vii) any temporary disruption of the United States or global financial markets or banking systems, due to natural disaster; terrorist act or otherwise, which prevents a Party from accessing such markets or causes a temporary inability to access funds; (viii) other act of God, or (ix) any other extraordinary cause or event beyond the reasonable control of the Person in question. "Garage LOC" means an irrevocable letter of credit acceptable to the Town, which is intended to have an initial term of at least one year, issued in favor of the Town by a bank, trust company or other financial institution, which will have a short-term rating in the highest short- term rating categories (without regard to any numerical or other qualifiers thereto) of both Moody's and S&P; or a long-term rating in one of the two highest long-term rating categories (without regard to any numerical or other qualifiers thereto) of either Moody's and S&P and a long-term rating in one of the three highest long-term rating categories (without regard to any numerical or other qualifiers thereto) of both Moody's and S&P, or by such other entity as wii, shall be approved in writing by the Town. The Parties acknowledge that during the Planning and Entitlement Period it may be determined by the Parties that an alternate form of guarantee may be preferable to the Garage LOC. The Parties hereby agree that such alternative may be used upon the request of the Developer and approval of the Town Manager, so long as the intent and rating categories of such alternative are comparable to the terms set forth in this definition, and are acceptable to the Town. "Holder" means the owner of the Mortgage. "Improvements" means all Public Improvements and the Private Improvements. "Information Center" means a new Town information center with approximately 2,000 square feet, to be located next to short term parking in the New Parking Structure, as depicted and described in the Project Description. The Information Center is a Public Improvement. "Interim Parking Management Plan" means any plan approved by the Town Council that provides for excess parking spaces in the event that the required number of Phase II parking spaces in the Existing Garage and/or New Parking Structure are unavailable by December 15, 2011 (as such date may be postponed in accordance with Section 5.01(c) and Section 5.01(d) hereof). "Lionshead Redevelopment Master Plan" means the Lionshead Redevelopment Master Plan, which is the Town's official planning document for guiding the redevelopment of the Lionshead area, and which is part of the Vail Comprehensive Plan, adopted by the Town Council in 1999. "Lodging" means, two hotels, one of which will be in the Smith Travel Research "Luxury" category, and one of which will be in the Smith Travel Research "Upper Upscale" category, which, collectively will have not less than 240 guest rooms, and in addition, not more than 130 residential units, and not less than 25 fractional fee units allocated between the two hotel buildings, all as depicted and described in the Project Description. "Metropolitan District(s)" shall have the meaning given to it in Section 7.02(a) of this Agreement. "Month" or "month", when used without modification, means any consecutive 30 day period of time. "Moody's" means Moody's Investors Service, Inc., its successors and assigns, and, if Moody's Investors Service, Inc. will for any reason no longer perform the functions of a security rating agency, "Moody's" will be deemed to refer to any other nationally recognized securities rating agency designated by the Town. "Mortgage" means any mortgage or deed of trust conveying an interest in the Project for the purpose of securing a debt or other obligation. "New Parking Structure" means the new parking structure that will replace the Existing Garage with approximately 1,450 public parking spaces (which include short-term/local day skier drop-off parking), plus additional parking as may be required by the Zoning Regulations in order to support the Project (excepting the Private Parking), as such New Parking Structure is depicted and described in the Project Description. The Parking Related Infrastructure will be located in or on the New Parking Structure, and the New Parking Structure, excepting the Private Parking located therein, is a Public Improvement. "New Parking Structure TCO" means a certificate or certificates, as applicable, issued by the Town that permit legal and beneficial occupancy, operation and use of the New Parking Structure without interruption for its intended purposes, which certificate or certificates may be 8 issued with or without qualification so long as any qualification will not prohibit, restrict or impair such occupancy, operation or use. "Non-Parking Infrastructure" means the Road Improvements, Conference Center, Lodging and Retail Development. "Parking Facilities" shall have the meaning given to it in Section 9.02 of this Agreement. "Parking Related Infrastructure" means the Transportation Center, Private Parking, Replacement Public Facilities and Information Center. "Party" and "Parties" shall have the meaning given to such terms in the opening paragraph of this Agreement. "PEC" means the Planning and Environmental Commission of the Town. "Permitted Exceptions" means the permitted exceptions to Title prepared and delivered by Developer. "Person" or "person" means a natural person, a trustee, a corporation, a partnership, a limited liability company and any other form of legal entity. "Phase I" means the period of time intended by the Parties to last from April 1, 2010 to March 31, 2011, as such date may be extended in accordance with the terms hereof, during which the first phase of construction of the New Parking Structure shall occur, which includes reconfiguration of the Existing Garage. "Phase II" means the period of time intended by the Parties to last from April 1, 2011 to March 31, 2012, as such date may be extended in accordance with the terms hereof, during which the second phase of construction of the New Parking Structure shall occur. "Phase III" means the period of time intended by the Parties to last from April 1, 2012 to September 1, 2013, as such date may be extended in accordance with the terms hereof, during which the third phase of construction of the New Parking Structure shall occur, which shall also include any final finishing of construction and punch list work items. The Parties intend to have obtained the New Parking Structure TCO by December 1, 2012, and for the Date of New Parking Structure Final Completion to be September 1, 2013, or such alternative date to which the Parties may mutually agree. "Planning and Entitlement Period" means the period of time that begins on the Effective Date and ends on the Escrow Delivery Date, during which Developer will engage in Site Investigation; certain pre-construction activities; certain planning and design activities, including preparation and obtaining approval of the Project Plan and Conference Center Agreement; certain entitlement activities, including obtaining required PEC and DRB approvals; and certain drafting and financing activities, including obtaining approval of the Service Plans and obtaining confirmation of the sufficiency of the Finance Plan, as such period of time may be extended in accordance with the terms of this Agreement. 9 "Plans" shall have the meaning given to it in Section 10.03 of this Agreement. "Private Improvements" means the Lodging, the Private Parking and the Retail Development. "Private Parking" means the private parking spaces (in such minimum quantity as required by the Zoning Regulations) and related areas located in the New Parking Structure, for which the Parties intend to have ingress, egress, maintenance and control that is separate from that of the New Parking Structure, as such Private Parking is depicted and described in the Project Description. The Parties intend for the Private Parking to be located in the New Parking Structure, but for the Private Parking to be owned by Developer and to be a Private Improvement. "Project" means the Public Improvements and the Private Improvements to be constructed on the Site. "Project Description" means, collectively, the Proposal (Exhibit C-1), the Supplement (Exhibit C-2) and the Traffic Patterns and Parking Program (C-3), collectively attached hereto as Exhibit C. "Project Plan" means the schematic, architectural internal and external layouts of the Project, which may include major architectural concepts, defined and architectural uses, massing, a valet parking program and movement of people, but shall not include architectural details including colors, materials or other similar architectural or design specifics. "Proposal" means the "Lionshead Parking Structure Redevelopment: The Open Hospitality Partners & Hillwood Capital [Open I Hillwood] Partnership, Phase 2 Submittal," dated September 29th, 2006, attached hereto as Exhibit C-1. "Public Improvements" means the New Parking Structure (except the Private Parking), the Transportation Center, the Conference Center, the Road Improvements, the Information Center, the Replacement Public Facilities, and appropriate connections including infrastructure, superstructure, shared elevators, access, security and other integrated components as may be set forth in the Shared Facilities Agreement. "Public Parking Structure Parcel" means the fee interest in the separate and distinct development area of the Site where the New Parking Structure will be constructed (including the separate and distinct parcels of the Site where the Transportation Center, Replacement Public Facilities and Information Center will be located and excluding the separate and distinct parcel of the Site where the Private Parking will be located). "Remaining Project Components" means all of the Private Improvements and the Public Improvements, except the New Parking Structure. "Remaining Project Components TCO" means a certificate or certificates, as applicable, issued by the Town that permit legal and beneficial occupancy, operation and use of each of the Remaining Project Components without interruption for each of its intended purposes, which 10 certificate or certificates may be issued with or without qualification so long as any qualification will not prohibit, restrict or impair such occupancy, operation or use. "Replacement Public Facilities" mean the on-site replacement in the New Parking Structure of approximately 4,400 square feet of certain public-benefit facilities currently located in the Existing Garage, as depicted and described in the Project Description. The Replacement Public Facilities are a Public Improvement. "Retail Development" means the approximately 60,000 square feet of retail space, including the privately owned, retail oriented pedestrian street envisioned as a public oriented extension of the Lionshead core area streetscape improvements, as depicted and described in the Project Description. The Retail Development is a Private Improvement. "RFP" means the "Request for Proposals: To redevelop existing parking structure in Vail, Colorado as a mixed use development providing over 1150 public parking spaces" issued by the Town on May 10, 2006, for the potential mixed-use redevelopment of the Site. "RFP Response" shall have the meaning given to it in the Recitals of this Agreement. "Road Improvements" means a new roundabout, improvements to South Frontage Road and improvements to East Lionshead Circle, including the area commonly referred to as the "chute," all as depicted and described in the Project Description. The Road Improvements are a Public Improvement. "S&P" means Standard and Poor's Ratings Group, a Division of McGraw Hill, Inc., its successors and assigns, and, if Standard and Poor's Ratings Group, a Division of McGraw Hill, Inc. will for any reason no longer perform the functions of a security rating agency, "S&P" will be deemed to refer to any other nationally recognized securities rating agency designated by the Town. "Service Plans" shall have the meaning given to it in Section 7.02(a) of this Agreement. "Shared Facilities Agreement" shall have the meaning given to it in Section 2.02(f) of this Agreement. "Site" shall have the meaning given to it in the Recitals of this Agreement. "Site investigation" means the investigation, pre-construction, planning, design, entitlement, drafting and financing activities work on or related to the Site that is necessary before Developer begins Commencement of Construction, which includes but is not limited to performing surveys, testing and inspections, and related activities. "Site Map" means the depiction of the Site set forth on Exhibit B hereto. "State" means the State of Colorado. 11 "Supplement" means the "Lionshead Parking Structure Redevelopment: The Open Hospitality Partners & Hillwood Capital [Open I Iillwood] Partnership, OHP response to Staff Memo of December 07, 2006," dated January 5, 2007, attached hereto as Exhibit C-2. "Survey" means the survey for the Site to be provided by Town to Developer within sixty (60) days of the Effective Date, as further described in Section 3.05 of this Agreement. "Surveyor" shall have the meaning given to it in Section 3.05 of this Agreement. "Title Commitment" means a current ALTA owner's Title insurance commitment for the Site issued by the Title Company. "Title Company" means Land Title Guarantee Company. "Town" shall have the meaning given to it in the opening paragraph of this Agreement. "Town Certificate" means the certificate delivered to Developer by the Town at Escrow Delivery, which states that all of the representations and warranties of the Town made in this Agreement are true and correct as of the Escrow Delivery Date as if made on the Escrow Delivery Date, and that the Town has satisfied each of the Escrow Delivery Conditions set forth in Sections 4.03(a) through 4.03(t) of this Agreement. "Town Code" means, collectively, the Vail, Colorado Town Code and the Town's home rule Charter, as each may be amended from time to time. "Town Council" means the Vail Town Council, as duly elected, appointed or serving in accordance with the Town Code. "Town Manager" shall mean the duly appointed Manager of the Town. "Traffic Patterns and Parking Program" means the "Traffic Patterns & Parking Program," dated July 12, 2007, attached hereto as Exhibit C-3. "Transportation Center" means a fully integrated Bus/Town Shuttle Bus bays, located in the New Parking I the Project Description. The Transportation Center is a Pu "Vail Associates" means Vail Associates, Inc., Associates, Inc., a Colorado corporation or any other related "Vested Rights Act" means Colorado Revised Statu same may be amended from time to time. "Vested Rights Laws" means, collectively, the Veste et seq. of the Town Code, as each may be amended from tim "Year" or "year", when used without modificatioi period of time. ation center with five ECO as depicted and described in Vail Corporation, DB/A Vail orate entity. Section 24-68-101 et seq., as the time. Act and/or Section 12-19-1 any consecutive 365 day 12 "Zoning Regulations" means the Town of Vail Zoning Regulations, at Titles 12, 13 and 14 of the Town Code and as set forth in the Lionshead Redevelopment Master Plan. Section 1.03 Other Definitions. Any other term to which meaning is expressly given in another section of this Agreement shall have such meaning. Section 1.04 Rules of Construction. (a) Except as specifically provided herein, any approval, consent, permission, submittal or authorization contemplated under this Agreement by the Town and/or Developer shall be given in advance and in writing, and any consent, approval, permission or authorization shall apply only in the instance given. (b) The Recitals are made part of this Agreement. (c) A term defined in this Agreement that includes one or more items, when used, shall mean all or one or more of those items. (d) A term defined in this Agreement that means or refers to an agreement, writing or statute shall mean and refer to that agreement, writing or statute as amended, modified, substituted for or replaced from time to time, but only if and to the extent that such amendment, modification, substitution, or replacement is permitted under, and made in accordance with this Agreement. (e) Whenever in this Agreement there is a day or time period established for performance and such day or the expiration of such time period is not a Business Day, then such time for performance shall be automatically extended to the following Business Day. (f) The headings of the sections, subsections, paragraphs and subparagraphs hereof are provided for convenience of reference, and shall not be considered in construing their contents. (g) As used herein, all references made (i) in the neuter, masculine or feminine gender shall be deemed to have been made in all such genders, (ii) in the singular or plural number shall be deemed to have been made, respectively, in the plural or singular number as well, and (iii) to any sections, subsections, paragraphs or subparagraphs shall be deemed, unless otherwise expressly indicated, to have been made to such sections, subsections, paragraphs or subparagraphs of this Agreement. (h) The words "including" and "includes," and words of sire lar import, shall be deemed to be followed by the phrase "without limitation." Section 1.05 Exhibits. EXHIBIT A Site Description EXHIBIT B Site Map EXHIBIT C Project Description (Exhibit C is not attached hereto because of its size and is on 13 file at the Office of the Town Manager) EXHIBIT C-1 Proposal EXHIBIT C-2 Supplement EXHIBIT C-3 Traffic Patterns and Parking Program EXHIBIT D Conference Center Summary ARTICLE H PROJECT DESCRIPTION Section 2.01 Selection and Engagement. On March 13, 2007, after the conclusion of a year-long RFP process, the Town Council authorized an exclusive 120-day negotiation period with Developer for the redevelopment of the Site. This Agreement is the result of such negotiations, and sets forth the basic terms and conditions of the Project, and the rights and obligations of the Parties. The Town hereby formally selects and designates Developer as the developer of the Project on the Site, and engages Developer to develop, plan, construct and implement the Project, or cause the same to occur, including the construction of specified Public Improvements and Private Improvements. Section 2.02 Description of Project. (a) The Project will consist of a new parking facility, a fully integrated transportation center, a conference center, a new roundabout and road improvements, a new Town information center, replacement of approximately 4,400 square feet of certain public- benefit facilities, two neW Hotels and approximately 60,000 square feet of retail space, including i a retail oriented pedestrian street, all as depicted and described in the Project Description, which is attache ereto as Exidbit , aninc u es a ropos the upp ement and the ra c Patterns and Parking Program. Any inconsistent depictions or descriptions of the Project that occur among the Proposal, the Supplement and the Traffic Patterns and Parking Program shall be resolved in favor of the most recently dated thereof. Any inconsistent depictions or descriptions of the Project that occur between the text or body of this Agreement and the Project Description shall be resolved in favor of the text or body of this Agreement. The Project Description is current as of the Effective Date; however the Parties intend that the Project Description will be modified, supplemented or amended by the Project Plan, the Conference Center Agreement, the Shared Facilities Agreement and the Approved Development Plan. (b) The Project will include the Public Improvements and the Private Improvements, and will be developed in accordance with this Agreement, the Project Description, the Project Plan, the Conference Center Agreement, the Approved Development Plan and the Shared Facilities Agreement. (c) On the Final Closing Date, Town will convey certain interests in the Site, and certain interests in surface, subsurface or airspace development areas of the Site, as described in Section 2.03 below. After the Final Closing, Developer will employ commercially reasonable efforts to develop the Project by causing the Improvements to be constructed in accordance with this Agreement, the Project Description, the Project Plan, the Conference Center Agreement, the Approved Development Plan and the Shared Facilities Agreement, all in accordance with 14 applicable laws and regulations (including, without limitation, the Town Code and the Environmental Laws). (d) Public Improvements. The Public Improvements will be developed, planned and constructed by Developer, or the Developer will cause the same to occur. All Public Improvements will be designed and built subject to the requirements of the Town, and the Town shall have the right to approve the design and final construction drawings for all Public Improvements. The Public Improvements may be legally owned and described as separate parcels, or as a single parcel, in the discretion of the Town or Metropolitan District(s), as appropriate. The "Public Improvements" will include the following components: (i) a new parking structure that will replace the Existing Garage with approximately 1,450 public parking spaces (which include short-termllocal day skier drop-off parking), plus approximately 255 additional public parking spaces to serve the Retail Development and other Public Improvements and approximately 320 private parking spaces to serve the remaining Private Improvements, all as may be required by the Zoning Regulations in order to support the Project (excepting the Private Parking), as such New Parking Structure is depicted and described in the Project Description (the "New Parking Structure"); provided, however, that the Private Parking is not a Public Improvement; (ii) a fully integrated transportation center with five ECO Bus/Town Shuttle Bus bays, located in the New Parking Structure, as depicted and described in the Project Description (the "Transportation Center"). The Town intends to seek approximately five million dollars ($5 million) in Federal funds to be applied to the construction of the Transportation Center, but should such funds not be available in the time frame needed for construction of the Transportation Center, the Town will consider applying other funds such as revenue from tax increment financing (TIF). In the event that a Transportation Center is constructed at a location other than as part of the Project, space allocated for the Transportation Center will be used for additional public parking. (iii) a conference center with approximately 34,000 total gross square feet of ballroom, breakout, pre-function and "back of house" space, as may be amended and supplemented pursuant to the Conference Center Agreement (the "Conference Center"); (iv) a new roundabout, improvements to South Frontage Road and improvements to East Lionshead Circle, including the area commonly referred to as the "chute," all as depicted and described in the Project Description (the "Road Improvements"). The Road Improvements are a Public Improvement; (v) a new Town information center with approximately 2,000 square feet, to be located next to short term parking in the New Parking Structure, as depicted and described in the Project Description (the "Information Center"); (vi) on-site replacement in the New Parking Structure of approximately 4,400 square feet of certain public-benefit facilities currently located in the Existing Garage, as depicted and described in the Project Description (the "Replacement Public Facilities"). 15 (e) Private Improvements. The Private Improvements will be developed, planned and constructed by Developer, or Developer will cause the same to occur. The Private Improvements will be sited above the New Parking Structure and abutting or adjacent to other Public Improvements. The Private Improvements may be legally owned and described as separate parcels, or as a single parcel, in Developer's discretion. The "Private Improvements" will include the following components: . (i) two hotels. Developer currently contemplates that the two hotels will be branded as a W Hotel and a St. Regis Hotel. To the extent Developer does not execute an agreement for a W Hotel and a St. Regis Hotel, Developer may substitute either or both of the contemplated brands subject to the following conditions: (1) one of the hotels will be affiliated with a brand identified as "Luxury" by Smith Travel Research; and (2) the other hotel will be an "Appropriate Substitute". Appropriate Substitute shall mean a hotel of equal or better service and amenities to the proposed W Hotel. (ii) the approximately 60,000 square feet of retail space, including the retail oriented pedestrian street envisioned as a public oriented extension of the Lionshead core area streetscape improvements, as depicted and described in the Project Description (the "Retail Development"); and (iii) the private parking spaces (in such minimum quantity as required by the Zoning Regulations) and related areas located in the New Parking Structure, for which the Parties intend to have ingress, egress, maintenance and control that is separate from that of the New Parking Structure, as such Private Parking is depicted and described in the Project Description (the "Private Parking"). The Parties intend for the Private Parking to be located in the New Parking Structure, but that the Private Parking will be owned by Developer. (f) The Parties acknowledge that there may be easements, licenses and cost sharing among the Public Improvements and Private Improvements, including, among other items, infrastructure, superstructure, shared facilities, access, security, heating, ventilating, air conditioning and other integrated components, as will be agreed to in a separate agreement to be executed by the Parties at Escrow Delivery (the "Shared Facilities Agreement' Section 2.03 Schedule of Conveyance of Title and Interests in Project. The following subsections set forth the Parties general intentions, as of the Effective Date, regarding conveyances of property interests relating to the Site. The Parties hereby acknowledge that certain easement rights and licenses involving, among other items, infrastructure, superstructure, shared facilities, access, security, heating, ventilating, air conditioning and other integrated components are not provided for in this Agreement, and will be negotiated by the Parties and memorialized in the Shared Facilities Agreement. (a) From the Effective Date forward, the Road Improvements, and the separate and distinct development areas and parcels upon which the Road Improvements will be constructed, shall remain in public ownership. (b) From the Effective Date to the Final Closing Date, Town will continue to own the Site in fee, and will continue to have possession and the rights and responsibilities of ownership. 16 (c) At Final Closing, Town will convey its fee interest in the Development Parcel and the development area of the Site where the Private Parking will be located to Developer. (d) From the Final Closing Date forward, the fee interest in the Public Parking _ Structure Parcel will be owned by the Town, and the fee interest in the development area of the Site where the Private Parking will be located will be owned by the Developer. (e) From the Final Closing Date to the Date of Project Final Completion, the fee interest in the Development Parcel will be owned by the Developer (who may convey the interest in the area of the Development Parcel where the Conference Center is to be constructed to the Metropolitan District(s) at anytime thereafter). (f) Immediately following the Date of Project Final Completion, Developer will convey any remaining interest it has in the area of the Development Parcel where the Conference Center has been constructed to the Metropolitan District(s), and the Metropolitan District(s) will take Title in fee to the Conference Center in accordance with normal and customary practices. The Metropolitan District(s) will retain Title to the Conference Center and the Developer will retain Title to the remainder of the Development Parcel. (g) Following the Date of Project Final Completion, the Parties and any affected Metropolitan District(s) will cooperate to obtain correction deeds for each of the Improvements, as necessary. Section 2.04 Operation and Maintenance of Improvements. (a) The Parties generally intend that the Developer will operate and maintain the Private Improvements, that the Town will operate and maintain all Public Improvements, except the South Frontage Road (which shall continue to be maintained by CDOT) and the Conference Center, and the Parties presently expect that the Metropolitan District(s) will operate and maintain the Conference Center. (b) The table below sets forth the ownership and responsibility for operation and maintenance for each of the Improvements. The Parties intend that the Shared Facilities Agreement will be consistent with the table: OPERATION & IMPROVEMENTS OWNERSHIP I MAINTENANCE South Frontage Road CDOT CDOT Remainder of Road Improvements Town Town Existing Garage and/or New Parking Town Town with regard to completed Structure, excluding Private Parking, portions open for public parking, before Date of New Parking Developer with regard to portions Structure Final Completion under construction New Parking Structure, excluding Town Town Private Parking, following Date of New Parkin Structure Final 17 Completion Private Parking Developer Developer Transit Center Town Town Information Center Town Town Replacement Facilities Town Town Conference Center Developer during construction, Metropolitan District(s) following construction Metropolitan District(s) and/or Lodging providers Retail Development Developer Developer Lodging Developer, private interests and/or homeowners associations Developer, homeowners associations and/or Lodging providers Section 2.05 Development Terms. The Lionshead Redevelopment Master Plan will govern and control with respect to the Approved Uses for the Project and the Site. In connection with the approval of the Approved Development Plan, the Town will act promptly on the Approved Development Plan in accordance with the terms of this Agreement. Following the Final Closing, Developer shall continue to design and develop the Project in accordance with the Approved Development Plan, subject to compliance with all applicable ordinances, requirements, rules, regulations, and policies of the Town, including, without limitation, applicable zoning ordinances (including Titles 12, 13 and 14 of the Town Code), requirements, rules, regulations, and policies. If either Party wishes to amend the Approved Development Plan, the Developer and Town Manager shall meet in good faith to discuss such amendment, and shall work cooperatively toward an amendment that is mutually agreeable to both Parties. Section 2.06 Vested Property Rights. The Developer and Town agree that the Approved Development Plan will constitute the approved "site specific development plan" for the Site and the Project under the Vested Rights Laws. Pursuant thereto, and to this Agreement, the Town agrees that Developer and its successors in interest will be entitled to have the right to undertake and complete development of the Site and Project in accordance with the Approved Development Plan, as the same may be further amended or supplemented in connection with the development process by additional development and construction plans, platting or otherwise. This right to so develop shall constitute a vested property right under the Vested Rights Laws, and the Approved Development Plan shall constitute a development agreement within the meaning of the Vested Rights Act. This vested right is being established in consideration of the substantial time and investment which has been and will be incurred by Developer and its Affiliates in planning for and undertaking the Project, and to afford Developer and its Affiliates and successors certainty of the availability of development rights during the potential phasing of the Project and the economic cycles and variability in market conditions that Developer and its Affiliates and successors many encounter during the development of the Project. The following language is hereby deemed incorporated into the Approved Development Plan (and amendments 18 and supplements thereto) as well as this Agreement: "Approval of this plan may create a vested property right pursuant to Colorado Revised Statutes Title 24, Article 68, as amended." This vested property right shall vest as of the date the Approved Development Plan is adopted and shall last until three years following the Date of New Parking Structure Final Completion. ARTICLE III PLANNING AND ENTITLEMENT PERIOD Section 3.01 Term. (a) The Planning and Entitlement Period shall begin on the Effective Date and shall terminate on the Escrow Delivery Date, unless Developer has terminated this Agreement prior to such date in its sole discretion pursuant to Section 4.05 or Section 14.06 hereof, or the Planning and Entitlement Period has been extended in accordance with Section 3.02 Or Section 4.05 hereof. (b) Upon Escrow Delivery, the Planning and Entitlement Period shall be deemed to have ended, and the Parties will be in the escrow period until the Final Closing Date. The Construction Phase shall begin on the Business Day following the Final Closing Date. The Parties intend for Final Closing to occur on February 1, 2010. Section 3.02 Site Investigation. Entitlements, and Design. (a) The Parties acknowledge that prior to the Construction Phase, Developer requires a period of time to engage in Site Investigation; certain pre-construction activities; certain planning and design activities, including preparation and obtaining approval of the Project Plan and Conference Center Agreement; certain entitlement activities, including obtaining required PEC and DRB approvals; and certain drafting and financing activities, including obtaining approval of the Service Plans and obtaining confirmation of the sufficiency of the Finance Plan. During the Planning and Entitlement Period, Developer shall take such related steps as it determines necessary to investigate and study all aspects of the Site, to design the Project and to engage in certain Site Investigation. (b) During the Planning and Entitlement Period, Developer or its agents, consultants and contractors may undertake Site Investigation or other activities in, on, under or above the Site, which Site Investigation or activities may include, but are not limited to: (i) Surveying and examining the condition of the Site, including, without limitation, the enviromnental condition of soils and groundwater, the existence of archeological or historical resources on the Site, existing environmental arrangements and laws affecting the Site, geo-tecluiical surveys, topographical surveys, wetland delineations, tree surveys, ALTA or other land surveys, Phase I and Phase II environmental studies, water supply studies, historical and archeological resources studies or wildlife studies; (ii) Completing the schematic design phase and design development phase of the Project; (iii) Completing the Project entitlement process; 19 (iv) Developing the Service Plans for the Metropolitan District(s); (v) Examining the financing structure for the Project; (vi) Preparing the Conference Center Agreement, the Project Plan, the Finance Plan and the Shared Facilities Agreement. (vii) Obtaining any required final PEC and DRB approvals relating to the development of the Site and the Project; (viii) Examining the condition of Title to the Site, including obtaining the Title Commitment to the Site in accordance with Section 3.04 below; and (ix) identifying the proposed location and timing for the construction phases of the Project, which information may be contained in the Approved Development Plan; (x) Assisting the Town in its obligation to obtain all necessary approvals from CDOT for the design and construction of South Frontage Road; and (xi) Examining all other aspects of the Site that relate to Developer's overall ability to develop the Project. (c) Developer shall perform any such Site Investigation in a good and workmanlike manner, free of mechanics liens and claims, in accordance with all applicable laws, rules, regulations and ordinances of any governmental authority with jurisdiction over the Site. Developer shall coordinate the performance of any such Site Investigation with the Town to minimize impacts on the public access and use of the Existing Garage. Section 3.03 License to Enter and Access. The Town hereby grants Developer, its agents, consultants and Construction Contractors a license to enter upon and to occupy any portion of the real property comprising the Site, and the right to enter onto the Site for purposes of conducting the activities described in Section 3.02 above in order to accomplish the timely Commencement of Construction, all at no cost to Developer (unless Developer must obtain a public way permit, in which case Developer shall pay Town's usual and customary fees for such permit). Developer shall provide Town with reasonable notice prior to entering the Site. Upon receipt of such notice, Town shall provide notice to any lessees occupying the Site regarding Developer's entry and activities. Developer hereby agrees not to interfere with the normal operation of the Existing Garage when conducting the activities described in Section 3.02 above. Section 3.04 Title Commitment. In connection with Developer's investigations on the Site during the Planning and Entitlement Period, Town shall provide the Title Commitment for Title insurance on the Site issued by the Title Company for information purposes only, together with all of the documents listed on Schedule B-2 of such commitment. Town shall work with , r Developer and the Title Company to review such Title exceptions in order to determine their validity, and to determine which Title exceptions will need to be removed and the required actions and timing for such removal. Prior to Escrow Delivery, the Developer shall prepare and deliver a list of exceptions to Title which Developer determines are acceptable (the "Permitted Exceptions"). 20 i' it Section 3.05 Surve. Prior to the Escrow Delivery Date, Town shall provide to Developer, at Developer's expense, an ALTA survey (the "Survey') of the Site setting forth an accurate legal description of the Site and showing the location of the precise boundaries thereof, together with all structures, utilities and any other improvements on the Site and all easements, - encroachments, rights-of-way and other matters affecting or appurtenant to the Site, whether recorded, visible or otherwise known to exist. The Survey shall be prepared by a licensed surveyor (the "Surveyor") acceptable to Developer and shall be certified to Developer and Title Company. The Surveyor shall note on the Survey the acreage of the Site. If the legal description of the Site as shown on the Survey differs from the legal description set forth in Exhibit A attached hereto, then such legal description shown on the Survey shall constitute the legal description of the Site for all purposes under this Agreement and such legal description shall be deemed substituted for the legal description attached hereto as Exhibit A. The Parties acknowledge that once the Approved Development Plan is completed, the legal description may need to be revised in a manner satisfactory to all Parties. Section 3.06 Lionshead Redevelopment Master Plan Amendment. The Town has previously approved the Lionshead Redevelopment Master Plan, and the Site is located within the "Lionshead Master Plan study area" identified in the Lionshead Redevelopment Master Plan. The Town and Developer acknowledge that the development of the Project in conformity with this Agreement requires certain amendments to the Lionshead Redevelopment Master Plan. Based upon and in conformity with this Agreement and the Approved Development Plan, the Town shall prepare an amendment to the Lionshead Redevelopment Master Plan that will accommodate the Project and the Approved Development Plan prior to the Escrow Delivery Date. Such amendment, and any subsequent amendments thereto, shall be subject to the Developer's review prior to adoption. Section 3.07 Zoning Process and Entitlement Activities. Developer shall work with the Town to obtain the necessary entitlements for development of the Project prior to Escrow Delivery and the Town shall cooperate with Developer in this effort. The Town and Developer agree that the successful development of the Project requires a planning and zoning process that effectively engages the community and is efficient, cost effective, flexible and responsive to the needs of the market place. The Town and Developer shall work cooperatively to secure appropriate zoning and land use approvals for the development of the Project. The Town and Developer agree to coordinate their efforts with regard to planning and zoning issues concerning the Project. Section 3.08 Project Plan. Following execution of the Deed Restriction Agreement, but r not later than March 15, 2008, Developer shall present the Project Plan to the Town Council for review. Either Party may extend the date for consideration for review of the Project Plan to a date not later than September 15, 2008, by written notice to the other Party. Any further requests for postponement of the consideration for review of the Project Plan shall be subject to the • •Oapproval of the Town Council. Nothing in the consideration of the Project Plan shall be construed as an automatic termination of this Agreement. The Town Council, on behalf of the ,v Town as owner of the applicable Public Improvements and in its capacity as co-applicant in the entitlement process, shall review the Project Plan. Upon favorable review of the Project Plan, Town Council shall authorize the Town Manager to sign an approval for the application to proceed with the Project entitlement process. 21 Section 3.09 Town Obligations During Planning and Entitlement Period. During the Planning and Entitlement Period, the Town shall have the following responsibilities and obligations, each of which shall be performed in a timely manner, but in any event prior to Escrow Delivery, and using commercially reasonable efforts: (a) The Town shall execute such licenses, permits, easements, rights of way and other agreements as Developer determines to be necessary or convenient to provide access by Developer and/or the Metropolitan District(s), and their respective agents and employees to the Site for purposes of developing the Site, providing utility service to the Site or to otherwise facilitate or accommodate development of the Site. (b) Town shall provide Developer copies of or access to all documents, studies, reports, survey materials and other materials in the custody of the Town, or actual or constructive control of the Town that might relate to the condition of the Site or the development of the Project. (c) Town shall provide Developer with copies of all documents evidencing conveyance of the Site to the Town, all lease agreements and other agreements that impact the Site, any information regarding any security interests in the Site, and information regarding existing and previous litigation or claims related to the Site and issues that might lead to litigation or claims. (d) (e) - Town shall take such actions and execute such documents as may be necessary to remove any encumbrances on the Site, including the deed restriction on the Site held by Vail Associates, that are not included in the Permitted Exceptions. Town shall take no actions and enter into no contracts, leases or other agreements that would affect Title to or use of the Site without Developer's prior written consent. (fl Town shall continue to manage and operate the Site and Existing Garage in accordance with its normal and customary management policies and practices. (g) Town shall assist Developer in its effort towards issuing a contract for final engineering design of the Road Improvements such that the Road Improvements can be completed and open for use by October 15, 2010 (as such date may be postponed or extended pursuant to the terms hereof). (h) Town shall have obtained all necessary approvals from CDOT for the design and construction of South Frontage Road, including any required environmental approvals and access permits. (i) Town shall comply with its insurance obligations set forth in Article XIII hereof. 22 0) Town shall cooperate with Developer in its efforts to investigate the Site. (k) Town shall fully disclose to Developer any other information available that might affect development of the Project. (1) The Town Council shall review the Project Plan, the Conference Center Agreement, the Service Plan(s), the Shared Facilities Agreement and an employee housing agreement as contemplated in Section 3.11. (m) The Finance Plan Consultant shall have briefed the Town Manager on his or her review and confirmation of the sufficiency of the Finance Plan. (n) The Town shall have approved the Interim Parking Management Plan. (o) The Town shall seek and actively pursue approximately five million dollars ($5 million) in Federal funds to be applied to the construction of the Transportation Center, but should such funds not be available in the time frame needed for construction of the Transportation Center, the Town will consider applying other funds such as revenue from tax increment financing (TIF). (p) Town shall respond to any other reasonable requests by Developer related to assisting with Developer's investigations. Information the Town considers non-public and confidential shall only be provided by the Town to Developer under proper protection of confidentiality. Section 3.10 Developer Obligations During` Planning and Entitlement Period. During the Planning and Entitlement Period, Developer shall have, and shall use commercially reasonable efforts to fulfill, the following obligations (provided that the requirement to use commercially reasonable efforts shall in no way affect Developer's ability-to terminate this Agreement during the Planning and Entitlement Period in accordance with Section 4.05 or Section 14.06 hereof): (a) Developer shall provide copies to the Town of any studies or reports Developer obtains or creates in the course of its investigations that are not Developer's Proprietary Information. (b) Developer shall process all entitlements and other approvals necessary for development of the Project within the relevant jurisdiction. (c) Developer shall manage all costs associated with the development of the Project. (d) Developer shall work towards issuing a contract for final engineering design of the Road Improvements such that the Road Improvements can be completed and open for use by October 15, 2010 (as such date may be postponed or extended pursuant to the terms hereof). (e) Developer shall assist Town in its effort to obtain all necessary approvals from CDOT for the design and construction of South Frontage Road, including any required environmental approvals and access permits. 23 (f) Developer shall comply with its insurance obligations set forth in Article XIII below. (g) Developer shall conduct any investigation work on the Site in a good and workmanlike manner, in accordance with all applicable laws and free of mechanics liens and claims. (h) The Developer shall present to the Town Council the Project Plan, the Service Plans, the Conference Center Agreement, the Shared Facilities Agreement and an employee housing agreement as contemplated in Section 3.11. (i) The Developer shall provide the Finance Plan to the Finance Plan Consultant for his or her review and confirmation of sufficiency. Section 3.12 Indemnification. Developer agrees to indemnify and hold harmless the Town, its officers and agents from any loss, liability, claim, demand, action, suit, judgment, damage, cost or expense (including without limitation reasonable attorneys' fees) arising from the Developer's Planning and Entitlement Period activities, including but not limited to any personal or bodily injury or death to any person, property damage, and mechanic's and materialmen's liens arising in connection with Developer's investigations; provided, however, Developer shall not be responsible for any claims, loss, injury, costs or expenses incurred by the Town arising out of the interruption or impairment of use or access to the Site during any such activities. Notwithstanding anything in this Section 3.11 to the contrary, each Party shall comply with their respective insurance obligations set forth in Article XIII herein. Section 3.13 Extension of Planning and Entitlement Period. The Planning and Entitlement Period may be extended if. (i) Developer requires additional time to conduct its I investigations, design or Site Investigation, (ii) Developer reasonably foresees that it will not be able to meet its obligations set forth in Section 3.10 above prior to the Escrow Delivery Date, (iii) it is reasonably foreseeable that Town will not be able to meet its obligations set forth in Section 3.09 above prior to the Escrow Delivery Date, or (iv) CDOT has not provided the necessary approvals for the design and construction of South Frontage Road prior to the Escrow Delivery Date, then Developer may provide notice to Town at least 5 Business Days prior to the scheduled Escrow Delivery Date that Developer wishes to exercise its rights under this section and extend the Planning and Entitlement Period for a period of 90 days. If, prior to the end of such 90 day extension period, any of the circumstances above are still unresolved, Developer may exercise its rights under this section and extend the Planning and Entitlement Period for an additional period of 90 days. 24 r- ARTICLE IV ESCROW DELIVERY, CONVEYANCE OF SITE AND FINAL CLOSING Section 4.01 Escrow Delivery; Final Closing. (a) Subject to satisfaction of the Escrow Delivery Conditions set forth in Section 4.03 below, the Town and Developer agree to close into escrow on the Escrow Delivery Date on the terms and conditions set forth in this Agreement. If the Escrow Delivery Conditions are satisfied and the Town and Developer close into escrow in accordance with Section 4.06 below, the Town and the Developer agree that, subject to the satisfaction of the requirements set forth in this Article, Town will convey its fee interest in the Development Parcel and the development area of ' the Site where the Private Parking will be located to Developer by spe -:al warranty deed on the Final Closing Date. (b) Fourteen days prior to the Escrow Delivery Date, the Parties shall generally have completed all Escrow Delivery Conditions or indicate a reasonable expectation of completing them by the Escrow Delivery Date. Section 4.02 Convwance Price. (a) The "Conveyance Price" for the Site, to be paid by Developer to the Town on the Escrow Delivery Date, shall be the good and valuable consideration provided to Town by Developer in accordance with this Agreement, including but not limited to Developer's commitment to develop the Project, taking into account Developer's agreement to undertake the obligations set forth in this Agreement. The Parties agree that the Conveyance Price represents the fair market value of the Site. (b) Each Party agrees to pay its own costs and fees associated with the Escrow Delivery and the Final Closing, subject to the adjustments to be made on the Final Closing Date to allocate closing costs and fees, which adjustments shall be set forth in written instructions from the Parties to the Title Company. The Parties intend that the Developer shall reimburse the Town its actual outside consultant fees and costs related to the entitlement process in an amount not to exceed three hundred thousand dollars ($300,000) on the Final Closing Date. Section 4.03 Escrow Delivery Conditions. The Town and Developer will be obligated to close into escrow only upon satisfaction or written waiver by the benefited party of the following Escrow Delivery Conditions on or before the Escrow Delivery Date. The determination of satisfaction of the Escrow Delivery Conditions in paragraphs (a) through (t) below shall be made by Developer, in its sole discretion. The determination of satisfaction of the Escrow Delivery Conditions in paragraphs (u) through (x) below shall be made by Town, in its sole discretion. (a) The Town's representations and warranties set forth in Section 11.02 hereof are true and correct as of the Escrow Delivery Date. (b) The Town shall have satisfied, to Developer's satisfaction, each of its obligations set forth in Section 3.09 hereof. 25 (c) Developer shall have determined that there are no agreements, leases, encumbrances, entitlement or other issues affecting the Site that would unacceptably impede development of the Site, including, but not limited to: (i) the deed restriction on the Site held by Vail Associates, and (ii) the existence of any recorded plat inconsistent with the Project and the _ conveyances contemplated in this Agreement. (d) The Deed Restriction Agreement shall have been executed by the Town and Vail Associates, and a copy thereof shall have been provided to Developer. (e) The Town shall have completed and obtained all necessary approvals from CDOT for the design and construction of South Frontage Road, including any required environmental approvals and access permits, and the Town has approved a contract for final engineering design of the Road Improvements such that the Road Improvements can be completed and open for use by October 15, 2010 (as such date may be postponed or extended pursuant to the terms hereof). (f) The Town Council shall have authorized the formation of the Metropolitan District(s) prior to the election at which such formation appears on the ballot. (g) The Service Plans for the Metropolitan District(s) shall have been approved by the Town. (h) The Developer shall have concluded its Planning and Entitlement Period activities hereunder and has not terminated this Agreement. (i) The Town shall have caused the Lionshead Redevelopment Master Plan to be amended to accommodate the Project and the Approved Development Plan. 0) The Town shall have approved re-zoning of the Site, if necessary, in a manner consistent with, and to accommodate, the Project. (k) The Town, PEC and/or DRB shall have provided all necessary approvals for the Project, including approval of the Approved Development Plan or approval of the Approved Development Plan with conditions acceptable to Developer, and land use and regulatory entitlements have been obtained consistent with the Approved Development Plan. (1) The Developer shall have presented, and the Town Council shall have approved, the Project Plan, the Shared Facilities Agreement and an employee housing agreement as contemplated in Section 3.11. (m) The Finance Plan Consultant shall have met with the Town Manager and reported on his or her review and confirmation of the sufficiency of the Finance Plan. (n) The Conference Center Agreement shall have been executed and delivered. (o) Developer shall have determined that no changes in zoning or other land use and building provisions directly or indirectly affecting the Site (including, without limitation, any local or State-wide moratorium or other restriction on construction or issuance of water or sewer 26 taps) have occurred or are pending that would materially diminish Developer's ability to timely develop the Site in accordance with the Approved Development Plan. (p) The Town shall have provided assurance to the Developer that adequate water, wastewater, sewer, and other utilities provided by or through the Town will be available for construction and opening of each of the Public Improvements and Private Improvements. (q) Developer shall have determined, through its Planning and Entitlement Period activities and investigations, that no condition of any portion of the Site is unsatisfactory to Developer. (r) The Developer shall have identified no circumstances during the Planning and Entitlement Period relating to the timing, potential yield or infrastructure costs for the Project that are so materially different from its understanding in preparing the Proposal and Supplement that they would result in significantly lesser returns to the Developer than were anticipated in the Proposal and Supplement. (s) The Town shall have approved the Interim Parking Management Plan. (t) Certificates evidencing the Town insurance coverages required under Article XIII of this Agreement shall have been reviewed by Developer. (u) Developer's representations and warranties set forth in Section 11.01 hereof are true and correct as of the Escrow Delivery Date. (v) Developer shall have satisfied, to Town's satisfaction, each of its obligations set forth in Section 3.10 hereof. (w) Developer shall have covenanted to use the Site in accordance with the Approved Uses and in a manner consistent with this Agreement, the Approved Development Plan and any entitlements obtained for the Site. (x) Certificates evidencing the Developer's insurance coverages required under Article )III of this Agreement shall have been reviewed by Town. Section 4.04 Certificates at Escrow Delivery. (a) The Town shall deliver to Developer on the Escrow Dc!ivery Date a certificate stating that all of the representations and warranties of the Town made in this Agreement are true and correct as of the Escrow Delivery Date as if made on the Escrow Delivery Date, and that the Town has satisfied each of the Escrow Delivery Conditions set forth in Sections 5.03(a) through 5.03(t) above (the "Town Certificate"). If the Town fails to deliver the Town Certificate or if the Town Certificate contains any exceptions or other limitations to any representation or warranty of the Town made in this Agreement, Developer shall be entitled to terminate this Agreement pursuant to Section 14.06 hereof. (b) The Developer shall deliver to Town on the Escrow Delivery Date a certificate stating that all of the representations and warranties of the Developer made in this Agreement are 27 true and correct as of the Escrow Delivery Date as if made on the Escrow Delivery Date, and that the Developer has satisfied each of the Escrow Delivery Conditions set forth in Sections 5.03(u) through 5.03(x) above (the "Developer Certificate'). If the Developer fails to deliver the Developer Certificate or if the Developer Certificate contains any exceptions or other limitations to any representation or warranty of the Developer made in this Agreement, the Town shall be entitled to terminate this Agreement pursuant to Section 14.05 hereof. Section 4.05 Parties Option to Extend Escrow Delivery or to Terminate. If the Escrow Delivery Conditions are not satisfied on or before the Escrow Delivery Date, then any Party having satisfied its Escrow Delivery Conditions may, at its option, either terminate this Agreement in accordance with Sections 14.05 or 14.06, as applicable, or extend the Escrow Delivery Date for sixty (60) days by providing written notice thereof to the other Parry. Section 4.06 Escrow Delivery. (a) If the Escrow Delivery Conditions are satisfied, executed copies of the Town Certificate and the Developer Certificate have been delivered, and if no event of default has then occurred or is continuing, the Parties intend for the Escrow Delivery to take place on the Escrow Delivery Date, at the offices of the Title Company or another location to be mutually agreed upon by the Parties. At the Escrow Delivery, the Parties and the Title Company shall deliver into escrow the following documents: (i) The Town shall deliver a special warranty deed executed and acknowledged as required by law, conveying to Developer Title of Town's fee interest in the Development Parcel and the development area of the Site where the Private Parking will be located, subject only to Permitted Exceptions. Prior to the Final Closing Date, the Developer shall have the right to request that the Town replace such special warranty deed with one or more deeds to one or more Affiliates, or to an accommodator or intermediary for purposes of carrying out an Internal Revenue Code Section 1031 exchange; (ii) The Parties shall execute an escrow agreement with the Title Company, in a form mutually agreeable to the Parties, that sets forth the Title Company's obligations during the period of escrow and at the Final Closing; and (iii) The Title Company shall deliver the Title Commitment. Section 4.07 Final Closing. (a) The Town and Developer will be obligated to close hereunder only upon satisfaction or written waiver by the benefited Party of the following on or before the Final Closing Date: (i) The Town shall have delivered to Developer on the Final Closing Date a certificate, in a from acceptable to Developer, stating that all of the representations and warranties of the Town made in this Agreement are true and correct as of the Final Closing Date as if made on the Final Closing Date; and 28 (ii) The Developer shall deliver to Town on the Final Closing Date a certificate, in a from acceptable to Town, stating that all of the representations and warranties of the Developer made in this Agreement are true and correct as of the Final Closing Date as if made on the Final Closing Date. (b) On the Final Closing Date, the Parties shall jointly notify the Title Company in accordance with the procedures set forth in the Escrow Agreement and the Title Company shall proceed to record the special warranty deeds or any replacement deeds submitted into escrow and take such other actions as are required in the Escrow Agreement. (c) If the Escrow Delivery Conditions are satisfied, executed copies of the Town Certificate and the Developer Certificate have been delivered, the obligations of this Section 4.07 have been satisfied, and if no event of default has then occurred or is continuing, Developer shall deliver on the Final Closing Date to Town the costs contemplated in Section 4.02(b) hereof by wire transfer or other means acceptable to the Title Company and the Town. Section 4.08 Title. Prior to the Escrow Delivery Date, Town shall have provided to Developer the Title Commitment, together with copies of all documents referred to therein and shall have delivered a current certificate of taxes and assessments due for the Site issued by the treasurer or assessor of the County. The Title Commitment will commit the Title Company to issue its standard Owners Title Policies subject only to the Permitted Exceptions, and together with the endorsements also listed on any exhibit thereon. Upon the Final Closing Date, the Title Company shall issue the Owners Title Policies (the Town will pay the premium therefor) to Developer. The Parties acknowledge that, if the Site is to be deeded to separate entities it may be necessary for the Title Company to issue separate Title insurance commitments and separate policies for each entity. ARTICLE V CONSTRUCTION Section 5.01 Generall . (a) The "Construction Phase" shall begin on the Business Day following the Final Closing Date. The Construction Phase shall end on the Date of Project Final Completion. Construction of the Project, and the contemplated uses and occupancies thereof, will comply with all applicable federal, State and Town laws, rules and regulations, including, but not limited to, building, zoning, and other applicable land use codes, subject to modifications approved by the Town pursuant to the planning, subdivision, zonng, environmental and other developmental ordinances and regulations. (b) It is the intent of the Parties that Developer shall cause to be performed the construction of the Project. Notwithstanding the foregoing, the Metropolitan District(s) may perform any of the obligations of the Developer under this Agreement with respect to the Public Improvements. Developer shall enter into Construction Contracts with each of the Construction Contractors; provided, however, that the Metropolitan District(s) may enter into Construction shall of the e Developer. Contracts for any Public Improvements, lc Improvements lieu appro approved by the Town Manager. Construction Contracts for each o Povemen 29 Construction Contract for each Public Improvement shall name the Town or Metropolitan District(s) (if the Metropolitan District(s) have not directly entered into such Constriction Contracts), as appropriate, as a third party beneficiary thereunder. The Construction Contract for the New Parking Structure shall contain a provision requiring the Construction Contractor, the Town and the Developer (or -Metropolitan District(s), as applicable) to meet monthly to discuss the progress of construction on the New Parking Structure. (c) The Parties acknowledge that all target construction commencement and completion dates set forth in Sections 5.02(a) and 5.03(a) below are dependent upon the executed Deed Restriction Agreement being delivered to the Developer prior to January 1, 2008, and the Interim Parking Management Plan being approved by the Town Council prior to January 1, 2008. If the executed Deed Restriction Agreement is delivered to the Developer, or the Interim Parking Management Plan is approved on or after January 1, 2008, each target construction commencement and completion date set forth in both Section 5.02(a) and Section 5.03(a) below shall be extended by a full year. Such extension shall be in addition to any other postponement or extensions permitted by this Agreement. (d) After Final Closing, Developer at its sole discretion may postpone Commencement of Construction for a period not to exceed 1 year beyond the intended target dates set forth below in Section 5.02(a) relating to Commencement of Construction of Phase I. Any requests for additional postponements of the Commencement of Construction shall be subject to approval of the Town Council. (e) If Commencement of Construction for Phase I is postponed in accordance with Section 5.01(c) or Section 5.01(d)(i) above, such postponement shall automatically extend all other target construction commencement and completion dates set forth in Section 5.02(a) below by the amount of time of such postponement, and if Developer elects to postpone Commencement of Construction for any of the Non-Parking Infrastructure in accordance with Section 5.01(c) or Section 5.01(d)(ii) above, such postponement shall automatically extend all subsequent other target construction commencement and completion dates set forth in Section 5.03(a) below by the amount of time of such postponement. Section 5.02 Construction of the New Parking Structure and Parking Related Infrastructure. (a) The New Parking Structure will be constructed in three (3) phases, so as to minimize impact on peak, winter season ski-traffic. The Transportation Center, Private Parking Replacement Public Facilities and Information Center (the "Parking Related Infrastructure") will be constructed concurrently with the New Parking Structure. (i) The Parties intend for Phase I of construction of the New Parking Structure, which includes reconfiguration of the Existing Garage, to begin on April 1, 2010 and to last until MMarch 31, 2011. (ii) The Parties intend for the Phase II of constriction of the New Parking Structure to begin on April 1, 2011 and to last until March 31, 2012. 30 (iii) The Parties intend for the Phase III of construction of the New Parking Structure to begin on April 1, 2012 and to have reached the Date of New Parking Structure Final Completion by September 1, 2013. The Parties intend to have obtained the New Par-ang Structure T CO and to be open to the public for use by December 1, 2012 and for any final finishing construction and punch list work items to be completed by September 1, 2013 unless Commencement of Construction on Phase I has been postponed pursuant to Section 5.01(c) or Section 5.01(d) hereof, in which case such date shall be extended by such period of postponement. (iv) The Parties intend for construction on the Parking Related Infrastructure to be constructed concurrently with the New Parking Structure, and to have obtained the Remaining Project Components TCO for each of the Transportation Center, Private Parking, Replacement Public Facilities and Information Center by December 1, 2012. (b) During the period lasting from December 15, 2010 to March 31, 2011 of Phase I, there will be at least 1,090 parking spaces on the Site open and available to the public. During the period lasting from December 15, 2011 to the Date of New Parking Structure Final Completion, there will be at least 1,100 parking spaces on the Site open and available to the public. The Parties intend to minimize impact on peak, winter season ski-traffic between December 15 and April 1 of any year, and so long as the parking spaces contemplated in this Section 5.02(b) are available, Developer may cause construction to continue on the Existing Garage and New Parking Structure using commercially reasonable efforts to minimize such construction impact. The dates in this Section 5.02(b) may be postponed for a period of time in accordance with Section 5.01(c) and Section 5.01(d) hereof. (c) Should Developer or Construction Contractor fail to meet any of the target New Parking Structure or Parking Related Infrastructure construction dates, Developer shall use all commercially reasonable efforts to cause construction to continue on the New Parking Structure and the Parking Related Infrastructure, and shall report to the Town monthly on such progress until Developer or Construction Contractor begins again to meet the target New Parking Structure and Parking Related Infrastructure construction dates. (d) Developer shall diligently pursue steps, or cause its Construction Contractor to diligently pursue steps, to meet the target construction dates set forth in Sections 5.02(a) and 5.02(b) above, and shall use all commercially reasonable efforts to ensure that the New Parking Structure will reach the Date of New Parking Structure Final Completion by September 1, 2013. If, despite these efforts, Developer or Construction Contractor encounters problems beyond their commercially reasonable control such that Developer reasonably believes that the New Parking Structure will not reach the Date of New Parking Structure Final Completion by September 1, 2013, Developer shall provide notice to Town of same at least 30 days prior to September 1, 2013. Such notice shall set forth Developer's revised intended Date of New Parking Structure Final Completion, which shall not be later than September 1, 2014 (unless Commencement of Construction was postponed in accordance with Section 5.01(c) and Section 5.01(d) hereof in which case such date shall be extended by such period of postponement). The Developer will not be obligated to make any payment for said extension, and De, eloper will not be considered in default hereunder for exercising its rights to such extension. Developer shall continue to use all commercially reasonable efforts, including, but not limited to, the imposition of an 31 accelerated schedule, to ensure that the New Parking Structure will be complete by the revised Date of New Parking Structure Final Completion. (e) If at anytime Developer causes Commencement of Construction of Phase I to _ occur, Developer is then obligated to cause the New Parking Structure to reach the Date of New Parking Structure Final Completion, pursuant to the terms of this Agreement. (f) If the Construction Contractor for the New Parking Structure provides written notice to the either of the Parties that such Construction Contractor has not been paid pursuant to the terns of the Construction Contract, Developer, upon notice thereof, shall have ten (10) Business Days to cause such Construction Contractor or another Construction Contractor to continue construction on the New Parking Structure. If Developer fails to cause construction on the New Parking Structure to continue, Town shall have twenty (20) Business Days to cause such Construction Contractor or another Construction Contractor to continue construction on the New Parking Structure, and Town shall be entitled to draw on the Garage LOC in accordance with Section 8.03 hereof. The provisions of this Section 5.02(f) shall be included in the Construction Contract for the New Parking Structure. (g) If the schedule for the construction of the New Parking Structure is delayed for reasons related to decisions of the Developer within its control, the Developer shall pay to the Town two hundred fifty thousand dollars ($250,000) for each year of delay, up to a maximum amount of two years (five hundred thousand dollars ($500,000) maximum payment) to assist the Town in making repairs and performing maintenance on the Existing Garage. (h) Developer shall use commercially reasonable efforts to cause the Construction Contract for the New Parking Structure to contain a provision whereby, if the Construction Contractor fails to complete either of Phase II or Phase III of construction of the New Parking Structure in accordance with the schedule set forth in this Agreement, Developer and Town shall each be entitled to fifty percent of any liquidated damages called for by the Construction Contract for the New Parking Structure. Section 5.03 Construction of Non-Parking Infrastructure. (a) The Non-Parking Infrastructure may be constructed prior to or simultaneously with the construction of the New Parking Structure and/or following the Date of New Parking Structure Final Completion, all in accordance with the target dates set forth in this Section 5.03. The Parties hereby acknowledge that the construction deadlines for the Non-Parking Infrastructure may be extended or accelerated, depending on the pace of construction of the New Parking Structure, CDOT approvals and other foreseeable and unforeseeable circumstances. (i) Construction on the Non-Parking Infrastructure is scheduled to occur from and after the Final Closing Date through the Date of Remaining Project Components Final Completion. (ii) The Parties intend for the construction of the Road Improvements to begin on April 1, 2010, for the South Frontage Road to be completed by November 1, 2010 and for all remaining Road Improvements to be competed and open to the public for use by December 1, 2013. 32 (iii) Construction of one Lodging hotel is scheduled to begin in April 2012 and be open to the public for use by December 1, 2013. (iv) Construction of one Lodging hotel is scheduled to begin in April 2013 and be open to the public for use by December 1, 2014. (v) Construction of the Conference Center and Retail Development is scheduled to begin in March 2013 and to be completed and open to the public for use by December 1, 2014. (vi) The Parties expect to obtain the last Remaining Project Components TCO on or about December 2014, at which point the Project will be substantially complete. (b) The Parties hereby acknowledge that construction of the New Parking Structure, the Parking Related Infrastructure and the Non-Parking Infrastructure will be an integrated process and that the Parking Related Infrastructure and Non-Parking Infrastructure may share infrastructure, superstructure, utilities and other shared facilities with the New Parking Structure. The Parties acknowledge that the target construction dates set forth in Section 5.03(a) above are dependant, in part, on the pace of construction of the New Parking Structure, and that the target construction dates of the Non-Parking Infrastructure are expected to be postponed, extended or accelerated, as circumstance permit or require, in accordance with the terms hereof. (c) Should Developer or Construction Contractor fail to meet any of the target construction dates of the Non-Parking Infrastructure, Developer shall use all commercially reasonable efforts to cause construction of the Non-Parking Infrastructure to continue, and shall report to the Town monthly on such progress until Developer or Construction Contractor begins again to meet the target construction dates of the Non-Parking Infrastructure. (d) In addition to its right to postpone commencement of construction set forth in Section 5.01(c) and Section 5.01(d) above, the Developer shall have the right to extend the target construction completion dates for the Conference Center for a period of one year if Developer or Construction Contractor encounters problems beyond their commercially reasonable control in meeting the target construction completion dates for the Conference Center set forth in Section 5.03(a) above, are diligently pursuing steps to meet the target construction dates for the Conference Center set forth in Section 5.03(a) above, and have provided written notice to Town of such extension at least thirty (30) days prior to the applicable target completion date that is intended to be extended. The Developer will not be obligated to make any payment for sa: d extension, and Developer will not be considered in default hereunder for exercising its rights to such extension. (e) In addition to its right to postpone commencement of construction set forth in Section 5.01(c) and Section 5.01(d) above, the Developer shall have the right to extend the target construction completion dates for each Lodging hotel and the Retail Development for a period of up to two years if Developer or Construction Contractor encounters problems beyond their commercially reasonable control in meeting the target construction completion dates set forth in Section 5.03(a) above, are diligently pursuing steps to meet the target construction dates set forth in Section 5.03(a) above, and have provided written notice to Town of such extension at least 33 thirty (30) days prior to the applicable target date that is intended to be extended. The Developer will not be obligated to make any payment for said extension, and Developer will not be considered in default hereunder for exercising its rights to such extension. (f) Notwithstanding anything in the Agreement to the contrary, if construction activities on the Non-Parking Infrastructure ceases for more than 45 consecutive days, or if the Project fails to reach Date of Project Final Completion by December 1, 2014, as such date may be postponed or extended in accordance with the terms hereof, Town shall notify Developer that Town plans to exercise its rights pursuant to Article XIV hereunder. If construction activities on the Non-Parking Infrastructure have not resumed within thirty (30) days of receipt of such notice, Developer shall be in default hereunder and Town shall be entitled to exercise its rights pursuant to Article XIV hereunder. Section 5.04 No Expense to Town. In no event shall the Town be responsible for any cost or expense related to demolition or to the construction, infrastructure improvement, installation or financing of the Project, unless such demolition or infrastructure improvement is necessitated by a specific independent request or requirement of the Town, and then only to the extent such infrastructure directly benefits the Town. ARTICLE VI CONFERENCE CENTER Section 6.01 General. (a) As described and depicted in the Project Description, Exhibit C, and the Conference Center Summary attached hereto as Exhibit D, Developer submitted plans for the Conference Center of approximately 34,000 square feet with a main ballroom of not less than 17,500 square feet, approximately 8000 square feet of pre-function and break-out space, and approximately 8650 square feet of back-of-house space, which Developer estimates to have an aggregate cost of $14 million. It is the intent of the Parties that, given the scope and the program of the Conference Center, Developer's cost of construction of the Conference Center, as described and depicted in the Project Description, shall not exceed $14 million in 2007 dollars. Developer has committed to present to the Town Council a revised Conference Center proposal within 120 days of the Effective Date, which the Town Council may approve and adopt at such time. Any portion of such proposal so approved and adopted by the Town Council shall be incorporated into the terms of the Conference Center Agreement. (b) If the Town Council adopts the Conference Center proposal, or any portion thereof, and the Conference Center proposal, or any portion thereof, forecasts that the cost of construction of the Conference Center, as revised, will exceed $14 million in 2007 dollars as adjusted by the annual rate of inflation (as measured by the Producer Price Index for construction materials and components published by the U.S. Department of Labor, Bureau of Labor Statistics), the Town hereby agrees to cover any cost increase beyond such amount. (c) If the Town Council adopts the Conference Center proposal, or any portion thereof, such terms shall supersede the terms of this Agreement, including the exhibit attached hereto, as this Agreement relates to the Conference Center. 34 (d) If the Town Council does not approve the Conference Center proposal, Developer shall cause the Conference Center that is described and depicted in the Project Description to be developed and constructed pursuant to the terms of this Agreement. . Section 6.02 Ownership and Operation. (a) Immediately following the Date of Project Final Completion, Developer will convey, pursuant to Section 2.03(f), any interest it has remaining in the Conference Center (or the area of the Development Parcel where the Conference Center has been constructed) to the Metropolitan District(s). The Parties presently expect that the Metropolitan District(s) will be responsible for the costs of maintaining and operating the Conference Center, and that the debts and obligations of the Conference Center, including any operating or maintenance costs, will not be the responsibility of the Town and will not be considered debts or obligations of the Town. (b) Prior to the Escrow Delivery Date and following the date that the Conference Center proposal, or any portion thereof, is approved by the Town Council, if applicable, the Parties (and any Metropolitan District(s), if applicable) will enter into an agreement that will set forth (i) the rules, regulations, processes and methods governing the operations, ongoing ;apital improvements, management and budgets and deficits of the Conference Center, and (ii) any revised, updated or amended schematic, architectural internal and external layouts of the Conference Center, which may include major architectural concepts, defined and architectural uses, massing and movement of people (but will not include architectural details including colors, corners, materials or other similar architectural or design specifics) (the "Conference Center Agreement"). The Conference Center Agreement will incorporate any terms of the Conference Center proposal that are approved and adopted by the Town, and will serve to amend and supplement this Article VI in its entirety. (c) Following the Date of Project Final Completion, after Developer has conveyed, pursuant to Section 2.03(f), any remaining interest it has in the Conference Center (or the area of the Development Parcel where the Conference Center has been constructed) to the Metropolitan District(s), the Metropolitan District(s) shall manage and operate the Conference Center, in a good and workmanlike manner in accordance with commercially reasonable standards in accordance with this Article VI of this Agreement, and the Conference Center Agreement, and consistent with the following comparable conference centers in first class resorts: Banff Centre, Monterey Conference Center, Snowmass Conference Center, Telluride Conference Center, Keystone Conference Center & Whistler Conference Center. The Metropolitan District(s) shall provide for any and all operation, maintenance, general upkeep, management, security, insurance, housekeeping or any other services with respect to the Conference Center, in a commercially reasonable manner. (d) Developer shall bear no additional costs for the Conference Center, other than the costs necessary to develop the Conference Center to the Date of Project Final Completion. Following the Date of Project Final Completion, after Developer has conveyed, pursuant to Section 2.03(f), any remaining interest it has in the Conference Center (or the area of the Development Parcel where the Conference Center has been constructed) to the Metropolitan District(s), Developer shall have no interest in, or responsibility or liability for the Conference Center. It is the intent of the Parties that a Metropolitan District, as described in Section 7.02 of 35 this Agreement, will be responsible for any operating deficits and the maintenance of and capital improvements for the Conference Center. If in a given fiscal year the Conference Center has an operating deficit, and the Metropolitan District cannot fund such operating deficit, then the Developer agrees to fund such operating deficit. (e) The Metropolitan District(s) will submit to an annual inspection of the Conference Center, to be arranged and paid for by Developer, whereby Developer or any consultant of Developer's choosing may inspect the Conference Center in order to ensure the general upkeep and maintenance thereof. Section 6.03 Conference Center Board. The Parties intend for the Conference Center to be managed and operated by a non-profit conference center entity, governed by a board of directors (the "Conference Center Board"). It is the intent of the Parties that the Conference Center Board members shall be appointed by the Town Council, and shall initially be comprised of five persons, two of whom shall be affiliated with Developer. The initial term of the Conference Center Board members shall be a term of three years each. The Parties intend that the Conference Center Board will be responsible for, among other items: (i) anticipated Conference Center bookings; (ii) marketing for the Conference Center; and (iii) Conference Center budgeting. Section 6.04 Conference Center Services. The Parties intend that the certain Conference Center services will be provided on a contract basis by the operator of either of the Lodging hotels, to be determined by the Developer and the Metropolitan District(s) at a later date. Such operator shall provide catering, housekeeping, janitorial and other operation and maintenance services as the Parties may agree to at a later date. ARTICLE VII FINANCING Section 7.01 General. (a) As set forth in this Agreement, it is the intent of the Parties that the Developer primarily finance, or cause to be financed, the Project. The Town agrees to work cooperatively with Developer in its efforts to obtain entitlements and financing, and the Town further agrees not to cause unnecessary delay in Developer's entitlement or financing efforts. (b) Prior to the Escrow Delivery Date, Developer shall present the Finance Plan to the Finance Plan Consultant, and the Finance Plan Consultant shall have met with the Town Manager to report on his or her review of the sufficiency of the Finance Plan. Section 7.02 Metropolitan District(s). (a) Developer and Town acknowledge that one or more metropolitan districts (the "Metropolitan Districts will need to be established for the purpose of financing, constructing and maintaining the Public Improvements for the Site. Town shall not be liable for any costs relating to the establishment or maintenance of any Metropolitan District(s). Developer shall work with the Town to establish the Metropolitan District(s) in accordance with the requirements of Title 32, Article I of the Colorado Revised Statutes and the requirements of the Town. 36 r- Developer may work with any consultants it deems necessary in establishing and maintaining the Metropolitan District(s). As required by 1L,x, the Metropolitan District(s) shall undertake activities in conformity with one or more service plans (the "Service Plans"), to be approved by the Town Council prior to Escrow Delivery. The Service Plans shall contain, among other matters, limitations on the amount and maturities of general obligation bonds and other obligations to be issued by the Metropolitan District(s), as well as the amount of ad valor.- n property taxation to be levied and collected by the Metropolitan District(s). It is the intent of the Parties that there shall be no mill levy cap for capital cost or expenditures and that there shall be no mill levy cap for operation and maintenance costs, each of which shall be set forth in the Service Plans. (b) The Town agrees not to sell any of the Site that is included within the boundaries of the Metropolitan District(s) to an individual (natural person) and not to permit any personal property owned by an individual (natural person) to be placed, located or remain on any such portion of the Site to the extent that such actions would permit any individual to become an eligible elector of the Metropolitan District(s). (c) Governance of the Metropolitan District(s) will be conducted by representatives elected by the eligible electors of each such Metropolitan District. The Parties intend that the initial board of directors of each Metropolitan District shall be nominated by Developer, provided however, that each such director nominated by Developer shall provide his or her resignation letter to the Town simultaneously with his or her appoirunent to the board of directors, which resignation letter shall provide that it is effective only upon the termination of this Agreement. The Town shall hold such resignation letters in trust and submit them to the Metropolitan District(s), as appropriate, if and only if this Agreement is terminated early pursuant to the terms hereof. (d) The Town and Developer acknowledge that it is their mutual expectation that, during the term of this Agreement, the Metropolitan District which is designated as the control district (the "Control District") will enter into an agreement with Developer to provide for management by Developer of construction activities of such district. (e) The Town shall cooperate with Developer and the Metropolitan District(s) in the formation of the Metropolitan District(s) and in the inclusion of property into the appropriate Metropolitan District(s). Section 7.03 Supplemental Financing. It is the intent of the Parties that supplemental financing be obtained to help finance the cost and or. _ -ation of the Improvements, including facility fees, a lodgers' public improvement fee, home owner association dues or other fees. Section 7.04 Holder Not Obligated to Construct. Notwithstanding the provisions of this Agreement, a Holder (including a Holder or other person or entity who obtains Title to all or a part of the Project as a result of foreclosure proceedings, or deed in lieu thereof, and including any other party who thereafter obtains Title to all or any part of the Project from or through the Holder or other person or entity) will not be obligated by this Agreement to construct or complete the Improvements, or any of them, or to guarantee the construction or completion of the Improvements. A Holder and any other persons specified above and their successors in 37 interest may, at their option, construct the improvements required under this Agreement in accordance with Section 7.06. Section 7.05 Copy of Notice of Default to Holder. If the Town delivers to Developer a demand or notice of any claimed Event of Default by Developer under this Agreement, the Town will at the same time transmit a copy of the demand or notice to each Holder at the last address of the Holder shown in the Town's records. All notices under this Section 7.05 will be given in accordance with the provision of Section 16.03. Section 7.06 Holder's Option to Cure Defaults. Any Holder will have the right, at its option, to cure or remedy or to commence to cure or remedy, any claimed default (to the extent that it relates to the part of the Project covered by its Mortgage) within thirty (30) days after the period for cure set forth in Section 14.02 after receipt of the notice required by Section 7.05 (or so long as cure has been commenced within such period, for so long as the Holder is diligently and continuously prosecuting such cure), and to add the cost thereof to the indebtedness secured by the Mortgage, provided, however that the Holder undertakes the cure or remedy in accordance with the terms and provisions of this Section 7.06. Nothing contained in this Agreement will be deemed to require, permit or authorize a Holder to undertake or continue the construction of the Improvements, except to the extent the Holder reasonably deems the same necessary to conserve or protect the Improvements or construction already made, without first having expressly assumed Developer's obligations with respect to the portion of the Project and Improvements which Holder elects to construct by written agreement reasonably satisfactory to the Town. In that event, the Holder must agree to complete the portion of the Improvements which the Holder has elected to construct, in the manner provided in this Agreement, and submit evidence reasonably satisfactory to the Town that it has the qualifications and financial responsibility necessary to perform such obligations. Section 7.07 Rights of Lenders and Interested Parries. Financing for acquisition, development and/or construction of the Project may be provided, in whole or in part, from time to time, by one or more third parties, including, without limitation, lenders, major tenants, and purchasers or developers of portions of the Site. The Town will recognize the rights of such interested parties and will otherwise permit such interested parties to assume all of the rights and obligations of Developer under this Agreement. The Town will have the right to approve such interested parties, and such approval shall not unreasonably be withheld. The Town will, at any time upon reasonable request by Developer, provide to any interested party an estoppel certificate or other document evidencing that this Agreement is in full force and effect. Upon request from an interested party, the Town will enter into a separate assumption or similar agreement with such interested party, consistent with the provisions of this Section 7.07. Section 7.08 Miscellaneous. The Town will not be required or expected to provide any financial assistance to the Developer or its tenants other than as set forth in this Agreement. The responsibility for the maintenance, repair and replacement of the Public Improvements and Private Improvements shall be as indicated in Section 2.04(b) and Developer shall have no responsibility for the maintenance, repair or replacement of the New Parking Structure (other than the Private Parking) or the Parking Related Infrastructure. 38 ARTICLE VIII LETTER OF CREDIT Section 8.01 ATew Parkin Structure Letter of Credit. - (a) The New Parking Structure is planned to be constructed in three phases, primarily between April and November of each year, e` o Parkin uSt~ct ire W~t beeconstructed n a~ timwinter ely ski-season parking. To ensure that the New g event of a manner, the parties have agreed that Developer will Garage LOC the intent of the Partie0s that ththe Developer default pursuant to Section 5.02(f), it is will allow the Town to quickly and efficiently continue construction, or cause construction to be continued, on the New Parking Structure. oper (b) The Construction Contract for the New Town as bird party beneficiary thereunder. and the Construction Contractor shall name Section 8.02 Garage LOC Characteristics. (a) The Garage LOC shall be in favor of the Town. The Developer shall be the obligated party under the Garage LOC. (b) Developer shall pay the costs and fees associated with maintaining the stated amount of the Garage LOC, as the same may be increased or decreased from time to time, unless Town has drawn on the Garage LOC. of construcdtioamount, a stated amount (c) The terms of the Garage LOC will reflect an n for the completion of and a time period relating to the projected cost and period all three Phases of the New Parking Structure. (d) The Garage LOC will reflect the cost of the Construction Contract for all phases on procee ds, and any other costs the parties agree rt~o~ction Contract, tthe amount. stat d amount ottthe tGarage LOC and payments are made on such Co will automatically be reduced by the of such uch Construction of s Contract, except to the Garage LOC will never exceed the remaining cost extent such excess amount is reflective of additional potential costs agreed to by the Parties. (e) The authorized amount, stated amount, time period and terms of the Garage LOC of New Parking Structure constructionmay e or~oth ~ financial ins ~tionGam ~ dmeOn replacement of the Garage LOC bank, trust company Par,kiso long as the theappropriate Structure to the Garage LOC or through any other otdhDcompl~etion ofdeems Garage LOC is always in place to guarantee construction that remains to be completed. Section 8.03 Drawing on the Gazase LOC. (a) In the event Town plans t draw on exert se its rights gh OC~d r the Gazagel LOCidme plans written notice to Developer that Town accordance with this Article and the provisions of Section 5.02(f). 39 (b) If Town exercises its rights hereunder and draws on the Garage LOC pursuant to this Article and Section 5.02(f), Town shall assume all of Developer's rights and obligations set forth in the Construction Contract for the New Parking Structure as the third party beneficiary thereunder. Town shall use the Garage LOC proceeds to ensure completion of the remaining construction of the New Parking Structure. Section 8.04 Termination of Garage LOC. So long as Developer has not defaulted hereunder, the Garage LOC shall automatically terminate on the Date of New Parking Structure Final Completion, and neither Party shall continue to have any rights or obligations thereunder. ARTICLE IX TOWN OBLIGATIONS AND COVENANTS Section 9.01 Town Obligations After Escrow Delivery. The Town shall have the following responsibilities and obligations, using commercially reasonable efforts to perform such responsibilities and fulfill such obligations, after Escrow Delivery: (a) The Town shall, in accordance with its normal policies and procedures, continue to execute such licenses, permits, easements, rights of way and other agreements as Developer determines to be necessary or convenient to provide access by Developer, its agents and employees to the Site for purposes of developing the Site, providing utility service to the Site or to otherwise facilitate or accommodate development of the Site. (b) The Town shall continue to approve and execute documents necessary to effectuate any additional Title transfer provided that the intended use of the Site in question is consistent with the Approved Development Plan and any entitlements obtained for such property. (c) Town shall comply with its insurance obligations set forth in Article XIII hereof. (d) The Town shall generally cooperate with the Developer in its effort to develop the Project. (e) The Town shall continue to manage and operate any and all portions of the Existing Garage andJor New Parking Structure open for public parking in accordance with the normal and customary policies and practices of the Town. (f) The Town agrees not to build or to cause to be built a conference center or similar facility that would have the effect of competing with the Conference Center. Such obligation will be incorporated into the terms of the Conference Center Agreement and will survive past the term of this Agreement, or any termination hereof, until January 1, 2035. (g) Following the Escrow Delivery Date, the Town shall grant no lien, and grant no further encumbrances, upon the Site or the Public Improvements, provided, however, that so long as no recorded or unrecorded lien or encumbrance attaches to the Site or the Public Improvements as a result thereof, the Town may assign all of its right, Title and interest in and to all rentals and other economic benefits deriving under and from this Agreement unto any lender of the Town as collateral security for the performance by the Town of its obligations thereto. 40 (h) In furtherance of the development of the Project, the Town will grant, across and upon any pertinent easement or property ownership interests held by the Town, and/or accept ices new corresponding public or quasi- nP of easementsProjectfor the subject town' Totlwnes approvalrof those as configured for the develop configurations as they may affect Town property interests. (i) The Town and Developer shall participate in a cooperative fashion in the preparation and implementation of a marketing plan for the Project. Section 9.02 Covenant to Maintain Improvements. In addition to managing and operating any and all portions of the Existing Garage and/or New Parking Structure open for public parking, Town shall manage and operate, in accordance with this Agreement and the Shared Facilities Agreement, the New Parking Structure (including the Transportation Center, the Replacement Public Facilities, but excluding the Private Parking) (the "Parkin Facilities"), and the applicable Road Improvements in a good and workmanlike manner in accordance with commercially reasonable standards, upon receiving a New Parking Structure TCO or the appropriate Remaining Components TCO for such Improvements. (a) From and after the Effective Date, Town covenants to provide for any and all operation, maintenance, general upkeep, management, security, insurance, housekeeping or any other services with respect to the Road Improvements (excepting South Frontage Road) and the Parking Facilities in a commercially reasonable manner. (b) Developer shall bear no additional costs for the Road Improvements and the Parking Facilities, other than the costs necessary to develop the Road Improvements and the Parking Facilities to the Date of Project Final Completion and any related costs provided for in the Construction Contract for the New Parking Structure, including any costs arising in the warranty period thereunder. Upon the Date of New Parking Structure Final Completion, Developer shall have no interest in, or responsibility or liability for the New Parking Structure. (c) Town agrees to submit to an annual inspection of the Parking Facilities, arranged and paid for by Developer, whereby Developer or any consultant of Developer's choosing, may inspect the Parking Facilities in order to ensure the general upkeep and maintenance thereof. ARTICLE X DEVELOPER OBLIGATIONS AND COVENAINTS Section 10.01 Developer Obligations After Escrow Delive . The Developer shall have the following responsibilities and obligations, using commercially reasonable efforts to perform such responsibilities and fulfill such obligations, after Escrow Delivery: (a) Developer shall arrange for all necessary financing, including any financing made available by the Metropolitan District(s), to develop, design, construct, manage and install infrastructure for the Project and to cause the construction of all such infrastructure. (b) Developer shall comply with its insurance obligations set forth in Article XIII below. 41 (c) Developer shall perform, or cause to be performed, any construction work on the Site in a good and workmanlike manner, in accordance with all applicable laws and free of mechanics liens and claims. (d) Developer shall continue to manage all costs associated with the development of - the Project. (e) Developer shall regularly report to the Town on the progress of the Project on such occasions as the Town reasonably requests but not less than annually, and shall provide the Town with an informal status report relating to all such items not less than once a month. (f) Developer shall design and develop the Project, or cause the Project to be designed and developed, in accordance with the Approved Development Plan, subject to compliance with all applicable ordinances, requirements, rules, regulations, and policies of the Town, including, without limitation, applicable zoning ordinances, requirements, rules, regulations, and policies. (g) Developer shall have determined prior to the Date of Project Final Completion, in its sole discretion, that no changes in zoning or other land use and building provisions directly or indirectly affecting the Site or the Project (including, without limitation, any local or Statewide moratorium or other restriction on construction or issuance of water or sewer taps) have occurred or are pending that would materially diminish Developer's ability to timely develop the Site and Project in accordance with the Approved Development Plan. (h) The Town and Developer shall participate in a cooperative fashion in the preparation and implementation of a marketing plan for the Project. (i) The Developer shall generally cooperate with the Town in connection with Developer's effort to develop the Project. 0) Prior to the Commencement of Construction of Phase I of the New Parking Structure, the Developer shall have obtained the Garage LOC. (k) Developer intends to pursue LEEDS certification for all eligible Improvements. Section 10.02 Covenant to Maintain Private Improvements. (a) From and after the Final Closing Date, Developer shall manage and operate the Private Improvements in a good and workmanlike manner in accordance with commercially reasonable standards. (b) From and after the Final Closing Date, Developer hereby covenants to provide for any and all operation, maintenance, general upkeep, management, security, insurance, housekeeping or any other services with respect to the Private Improvements, in a commercially reasonable malmer. Section 10.03 Plans, Reports. Studies and Investigations. The Developer shall regularly provide the Town, without cost or expense to the Town, copies of all final plans, 42 reports, studies, and investigations (collectively, the "Plans") prepared by or on behalf of the Developer with respect to the Public Improvements. To the extent the Plans are proprietary in nature or represent Developer's Proprietary Information, or other confidential commercial and financial information, it is the intent of the Parties that such Plan be deemed confidential and not be available as public records under the Colorado Open Records Act. Section 10.04 Commencement and Completion of Construction. Developer will undertake Commencement of Construction and achieve the Date of Project Final Completion in accordance with the terms of Article V hereof, as such target dates may be extended by the terms of this Agreement. Section 10.05 Developer's Affiliates. Developer shall be entitled to use its Affiliates for both pre-construction, construction management, and post construction services provided that the cost and terms of such services do not materially exceed prevailing market rates and terms. Developer or any Affiliate of Developer shall have the right to manage any Private Improvements and shall have the right to provide other ancillary services to the Private Improvements (including without limitation, property management, marketing, leasing, arranging financing) provided that the cost and terms of such services do not materially exceed prevailing market rates and terms. ARTICLE XI REPRESENTATIONS, AND WARRANTIES Section 11.01 Developer Representations and Warranties. Developer hereby represents and warrants to Town that the following are true and accurate as of the Effective Date: (a) Organization. As of the Effective Date, Developer (i) is duly organized, validly existing and in good standing under the laws of its state of formation; and (ii) has duly registered or qualified to do business and is in good standing in the State and in all other jurisdictions in which the nature of its activities would, under the laws of such jurisdiction, require it to be registered or qualified to do business therein. (b) Authority. This Agreement and the performance of Developer's obligations hereunder have been duly authorized, executed and delivered by the Developer, and constitute the valid, legally binding obligations of the Developer, as applicable, enforceable in accordance with their terms. (c) Other Agreements. Execution and performance of this Agreement, and the consummation of the transactions contemplated hereby, will not result in any breach or violation of any of the terms or provisions of or constitute a default under, any agreement or instrument by which the Developer is or will be bound. (d) Laws and Regulations. Neither the entering into of this Agreement nor the consummation of the transaction herein described will constitute or result in a violation or breach by the Developer of any judgment, order, writ, injunction or decree issued against or imposed upon it, or will result in a violation of any applicable law, order, rule or regulation of any governmental authority. 43 (e) Cooperation. Developer will cooperate with the Town, at the Town's expense, with respect to any litigation brought by a third party against the Town and concerning the Project, the Site or this Agreement. (f) Litigation and Proceedings. There is no pending litigation, proceeding or investigation contesting the power or authority of Developer or its officers with respect to the Project, this Agreement or Developer's financing, and Developer is unaware of any such litigation, proceeding, or investigation that has been threatened. Section 11.02 Town Representations and Warranties. Town represents and warrants to Developer that the following are true and accurate as of the Effective Date: (a) Organization. The Town is a home rule Town duly organized and validly existing under the State of Colorado. (b) Authority. This Agreement and the performance of the Town's obligations hereunder have been duly authorized, executed and delivered by the Town and constitute the valid, legally binding obligations of the Town, enforceable in accordance with their terms. (c) Other Agreements. Execution and performance of this Agreement, and the consummation of the transactions contemplated hereby, will not result in any breach or violation of any of the terms or provisions of or constitute a default under, any agreement or instrument by which the Town is or will be bound. (d) Laws and Regulations. Neither the entering into of this Agreement nor the consummation of the transaction herein described will constitute or result in a violation or breach by the Town of any judgment, order, writ, injunction or decree issued against or imposed upon it, or will result in a violation of any applicable law, order, rule or regulation of any governmental authority. There is no action, suit, proceeding or investigation pending which would become a cloud on the Title to the Site or any portion thereof or which questions the validity or enforceability of the transaction herein described or any action taken in connection with said transaction in any court or before or by any federal, district, county, or municipal department, commission, board, bureau, agency or other governmental instrumentality. No approval, consent, order or authorization of, or designation, registration or filing (other than for recording purposes) with any governmental authority other than the Town is required in connection with the consummation by the Town of the transaction herein described. (e) Cooperation. Town will cooperate with the Developer, at the Developer's expense, with respect to any litigation brought by a third party against Developer concerning the Project, the Site or this Agreement. (f) Litigation and Proceedings. There are no (i) claims, actions, suits, condemnation actions, or other proceedings pending or, to the knowledge of Town, threatened by any entity with respect to the Site or any use thereof, (ii) approvals, permits, easements, rights-of-way, zoning changes, uses or rights that have been denied, or to the knowledge of Town, may be denied, by any governmental department or agency, or (iii) violations of any law, statute, government regulation or requirement, that in any manner or to any extent may materially and 44 adversely affect the Site, or the value of the Site, or the likely eventual use of the Site, or Developer's right, Title or interest in and to the Site. (g) Condemnation. Neither the whole nor any portion of the Site, including access thereto or any easement benefiting the Site, is subject to a temporary requisition of use by any governmental authority or has been condemned, or taken in any proceeding similar to a condemnation proceeding, nor is there now pending any condemnation, expropriation, requisition or similar proceeding against the Site or any portion thereof. Town has received no notice and has no knowledge that any such proceeding is contemplated. (h) Tax Protest. There is no pending application or proceeding for the reduction of the assessed valuation of the Site or the property tax assessed against the Site for any tax year. (i) Huzardous Materials. The Town has provided to Developer all information in its possession or of which it is aware related to, and the Town itself has not caused, any generation, production, location, transportation, storage, treatment, discharge, disposal, use, release, threatened release or other disposition upon or under the Site of, (i) any toxic or hazardous substance, or material, pollutant or waste subject to regulation under the Resource Conservation and Recovery Act (as amended by the Hazardous and Solid Waste Amendments of 1984), 42 U.S.C. § 6901, et seq.; the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (as amended by the Superfiwd Amendments and Reauthorization Act of 1986), 42 U.S.C. § 9601, et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. § 1801, et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq.; the Clean Air Act, 42 U.S.C. § 7401, et seq.; the Safe Drinking Water Act, 42 U.S.C. § 300h, et seq.; the Clean Water Act, 33 U.S.C. § 1251, et seq.; all applicable State counterparts to such federal legislation and any regulations, guidelines, directives or other interpretations of any such enactment, all as amended from time to time or any other applicable State or federal environmental protection law or regulation; (ii) asbestos and asbestos-containing materials, special wastes, polychlorinated biphenols (PCBs), used oil or any petroleum products, natural gas, radioactive material, pesticides or methane in soil gas or (iii) any product, material or substance in any manner inconsistent with the regulations issued by, or so as to require a permit or approval from, the State or the County or the Town, or in a manner that might cause the Town to inspect the Site or issue an order pursuant to any applicable health code. The Town has no knowledge that there exist or have existed on the Site any storage tanks (either above or below the ground) or septic tanks or that there has been prepared any inspection report addressing any of the issues referenced in this Section. The Town has no knowledge that there exist on the Site any archeological or historic resources, any endangered or threatened species, or any wetlands. 0) Other Rights. Other than Developer pursuant to this Agreement, no person or entity has any right or option to purchase or otherwise acquire the Private Improvements or the airspace above the Site or any portion thereof or interest therein, and there are no unrecorded leases or other agreements related to the Site between the Town and any third party. (k) Assessments. No portion of the Site is subject to or affected by any assessments for improvements, whether or not a lien thereon, and the Town has no knowledge of any assessments proposed on account of any such improvements or of any work proposed, commenced or completed which could give rise to any such assessment. 45 (1) Permitted Exceptions. Other than as set forth in the Permitted Exceptions, there are no leases, subleases, licenses or other rental agreements or occupancy agreements (written or verbal) that grant any interest in and to the Site or any portion thereof or any improvement thereon or that otherwise give rights with regard to use of the Site or any portion thereof or any improvement thereon. (m) Encroachments. Except as shown on the Survey and the Title Commitment, there exist no adverse claims by any person or entity (including but not limited to adjoining Site owners) concerning, and no encroachments with respect to, the Site, and all fences located on the Site are within the Site boundaries. (n) Ownership. The Town holds fee simple Title to the Site free and clear of all liens and encumbrances except for (i) a deed restriction held by Vail Associates, which the Parties intend to be removed through the terms of the Deed Restriction Agreement, and (ii) those items listed as Permitted Exceptions. (o) Utilities. Adequate public water, wastewater, sewer, storm drainage, telephone, cable television, natural gas and electric lines, conduits or facilities are located on the Site or in streets or alleys immediately adjoining the Site and are available for use on the Site without additional cost to Developer other than normal connection charges. There are in effect no moratoria or other restrictions affecting such utilities or their availability to the Site. (p) Access. The Site fronts on, and has direct and unobstructed full-turn access to, the following public highways or streets: South Frontage Road. (q) Subdivision. As of the Final Closing Date, the Site will (i) appear in the public records as a separate lot or lots, alienable without any further requirement of any law, rule or regulation affecting the subdivision of real property, and (ii) comprise a separate tax lot or lots for the levy of real property taxes in the jurisdiction where the Site is located. (r) Documents. The documents delivered to Developer by the Town will be all of the instruments, documents and agreements binding upon the Town or the Site pertaining to the title, condition, use or operation of the Site and the expenses to which it is subject, will be true and complete copies, and unless otherwise indicated, will be in full force and effect in accordance with the terms thereof. (s) Disclosure. No representation or warranty made by the Town in this Agreement, or in any statement or certificate already furnished or to be furnished by the Town in connection with the transaction contemplated herein, contains or will contain any untrue statement or omits or will omit to state a material fact necessary to make the statements contained therein not misleading. ARTICLE XII GENERAL COVENANTS, INDEMNITY AND RESPONSIBILITY Section 12.01 Cooperation. The Town agrees to reasonably cooperate with Developer in the implementation of this Agreement and related agreements hereunder. The Town agrees to provide Developer with reasonable assistance with respect to (i) applications of 46 the Developer for building and other permits and approvals from the Town, and any permits or approvals required from any governmental authority, whenever reasonably requested to do so; provided, however, that all applications for such permits and approvals are in compliance with the applicable ordinances and regulations, approved plans and specifications, and all applicable codes, and (ii) obtaining the Town's approval of Developer's application for the Approved Development Plan, and the Town agrees to reasonably cooperate with Developer and to provide Developer reasonable assistance with respect to securing any construction and permanent financing that Developer may reasonably require in connection with the performance of its obligations under this Agreement. Section 12.02 Anti-Discrimination in Employment. In any activities undertaken under this Agreement, Developer will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, sexual orientation, handicap, ancestry or national origin. Section 12.03 Construction of the Project. Construction of the Project, and the contemplated uses and occupancies thereof, will comply with all applicable federal, State and Town laws, rules and regulations, including, but not limited to, building, zoning, and other applicable land use codes, subject to modifications approved by the Town pursuant to the planning, subdivision, zoning, environmental and other developmental ordinances and regulations. Section 12.04 Vacation and Dedication of Rights of Way. Developer will designate in writing any street rights of way determined to be necessary or desirable in order to implement the Approved Development Plan, and the Town will promptly commence and diligently pursue to completion the vacation of the existing street rights of way within the Site in accordance with the procedures set forth in the Town Code. After Developer completes construction of any discrete segment of the Road Improvements or any discrete improvement within the Site, Developer will dedicate and the Town will accept the rights of way, Road Improvements, and/or other improvement in accordance with the applicable Town Code and Approved Development Plan provisions. Section 12.05 Town's Responsibility. The Town will be responsible for, and to the extent permitted by law will reimburse Developer for, all costs and expenses incurred by Developer as a result of, all claims or suits for and damages to property and injuries to persons, including accidental death, to the extent caused by the Town's negligence in performing activities under this Agreement, whether such activities are undertaken by the Town or anyone directly or indirectly employed or under contract to the Town. Section 12.06 Notification of Claim. Each Party shall give the other Party prompt written notice of any claim or action covered by the indemnities set forth in this Section, provided, however, that the failure of one Party to notify the other Parry shall in no way prejudice the rights of said Party under this Agreement unless the other Party shall be prejudiced by such failure and then only to the extent of such prejudice; and the other Party shall have the right, but not the obligation, at its own expense, to participate in the defense of any such claim or action with counsel of its choice. 47 Section 12.07 Developer's Indemnification. Developer shall defend, indemnify and hold harmless the Town from and against any and all liability, claim of liability or expense arising out of (i) entry upon the Site from and after the Effective Date by Developer or its agents or Affiliates; (ii) the use, occupancy, conduct, operation or management of the Project by Developer or its agents or Affiliates; (iii) any work whatsoever done on the Project by Developer or its agents or Affiliates; (iv) any injury to or death of any person, or damage to any property due to the negligence, tortious or other act or omission of Developer or its agents or Affiliates; and from and against all expenses and liabilities incurred in connection with any claim of liability or expense or any action or proceeding brought thereon (including but not limited to the reasonable fees of attorneys, investigators and experts), all regardless of whether such liability or claim of liability is asserted before or after the expiration or any earlier termination of this Agreement. Nothing herein shall require that Developer indemnify the Town for the negligent or intentional acts or omissions of the Town or its officers, officials, representatives, employees, consultants or agents, or third parties unrelated to Developer or its agents or Affiliates, to the extent of any damage or injury caused directly by the Town, its officers, officials, representatives, employees, consultants or agents or such unrelated third parties. Section 12.08 Town's Indemnification. To the extent permitted by law and without waiving any of the provisions of the Colorado Governmental Immunity Act, C.R.S. 24-10-101, et seq., or any successor statute, the Town shall defend, indemnify and hold harmless Developer, its Affiliates and agents against any liability, claim of liability or expense arising out of (i) entry upon the Site from and after the Effective Date by the Town or its agents; (ii) the use, occupancy, conduct, operation or management of the Site by the Town or its agents; (iii) any work whatsoever done on the Site by the Town or its agents; and (iv) any injury to or death of any person, or damage to any property due to the negligence, tortious or other act or omission of the Town or its agents, and from and against all expenses and liabilities incurred in connection with any claim of liability or expense or any action or proceeding brought thereon. (including but not limited to the fees of attorneys, investigators and experts), all regardless of whether such liability or claim of liability is asserted before or after the expiration or any earlier termination of this Agreement. Nothing herein shall require that Town indemnify Developer, its Affiliates or its representatives, employees, consultants, or agents against the negligent or intentional acts or omissions of Developer, its Affiliates or representatives, employees, consultants, or agents or third parties unrelated to the Town, to the extent of any damage or injury caused directly or indirectly by Developer, its Affiliates or its representatives, employees, consultants or agents or such unrelated third parties. Section 12.09 No Waiver of Governmental Immunity. No provision of this Agreement shall act or be deemed to be a waiver by the Town or the Town of the Colorado Governmental Immunity Act, CRS 24-10-101, et seq. ARTICLE XIII INSURANCE REQUIREMENTS Section 13.01 Insurance Required From Effective Date to Final Closing Date. (a) The Town is a self insured entity through the Colorado Intergovernmental Risk Sharing Agency, pursuant to the Town Code. The Town shall maintain adequate insurance on 48 the Site and its employees, agents and affiliates operating on the Site from the Effective Date to the Date of Project Final Completion. (i) The Town will use its reasonable efforts to ensure .hat any contracte°s and/or subcontractors employed by the Town for services on the Site (the "Town Contractors ) a properly insured to meet the insurance requirements of Colorado Intergovernmental Risk Sharing Agency and the Town Code, as applicable and as may be amended from time to time, before any Town C:-ntractors are permitted to commence any work on the Site. The Town wrill use its reasonable efforts to ensure that each insurance policy of any Town Contractors shall name the Developer as an additional insured, at no additional expense to the Developer. (ii) The Town will use its reasonable efforts to ensure that every insurance policy maintained by any Town Contractors shall (i) provide that thirty (30) days advance written notice shall be given to Developer of cancellation, modification, termination or lapse of coverage except that only ten (10) days advance written notice shall be required in the event of non payment of premium, and that such insurance, as to the interest of Developer, shall not be invalidated by any act or neglect of Developer, its Affiliates or agents, the Town or any other named insured, additional insured or loss payee, nor by any foreclosure or any other proceedings relating to the Site nor by any change in the Title to or ownership of the Site, nor by use or occupation of the Site for purposes more hazardous than are permitted by such policy; and (ii) in the event any insuring company is not domiciled within the United States of America, include a United States Service of Suit clause (providing any actions against the insurer by the named insured or Developer, its Affiliates or agents shall be conducted within the jurisdiction of the United States of America). (iii) The Town will use its reasonable efforts to deliver to Developer, or cause any Town Coiitractors to deliver to Developer, a certificate of insurance showing the effectiveness of any insurance contemplated in this Section 13.01(a) above. At least five (5) days before any such Town Contractors' insurance policy expires, Town will use its reasonable efforts to deliver to Developer, or cause such Town Contractors to deliver to Developer, a certificate of insurance showing the effectiveness of such insurance together with a new certi:icate of insurance showing the effectiveness of a replacement policy. (b) Developer shall maintain or cause to be maintained, at no cost to the Town, the following insurance, from the Effective Date to the Closing Date: (i) Commercial general liability insurance which insurance shall be written on a so-called "Occurrence Basis, with X, C & U exclusions deleted (including completed operations, operations of subcontractors, blanket contractual liability insurance, owned, non- owned and hired motor vehicle liability, personal injury liability) with combined single limits against bodily injury and property damage of not less than $1,000,000 and with excess umbrella coverage raising the total coverage to not less than $5,000,000. This policy should have a Broad Form Endorsement and include the following coverages: Blanket h aalimits ctua can beLiability, Broad Form Site Damage, Completed Operations and Personal Injury. Suc through excess liability policies; 49 (ii) Comprehensive Automobile Liability which insures against claims for bodily injury and property damage arising from the use by the Developer of "any auto" with a combined single limit of One Million and 00/100 Dollars ($1,000,000.00) per accident; (iii) Workers' compensation insurance covering all persons employed by Developer with the required statutory coverages and limits, complying with State law; Section 13.02 Insurance Required From Closing Date to Date of Project Final Completion. (a) The Town is a self insured entity through the Colorado Intergovernmental Risk Sharing Agency, pursuant to the Town Code. The Town shall maintain adequate insurance on the Site and its employees, agents and affiliates operating on the Site from the Effective Date to the Date of Project Final Completion. (b) Developer shall maintain or cause to be maintained, at no cost to the Town, the following insurance relating to each of the Improvements (other than the Road Improvements), from the Final Closing Date to the Date of Project Final Completion: (i) With respect to the Improvements: 1) All Improvements under construction, from the Commencement of Construction until the Date of Project Final Completion, "Builder's Special Form 100% Completed Value Non-Reporting" or "Course of Construction" insurance; 2) With respect to all Improvements constructed pursuant to this Agreement, special form risk property insurance; 3) Such coverage will include the Improvements themselves, all materials and supplies included in the Improvements, and with respect to builder's risk coverage, all materials and supplies to be used in completion of the Improvements, whether any or all of the foregoing are located at the site, in transit, or while temporarily stored off-site. The coverage will be for "Special Perils" and, subject to reasonable commercial availability, will include coverage for losses caused by fire; collapse; flood insurance if applicable; glass breakage; and freezing; (ii) Commercial general liability insurance which insurance shall be written on a so-called "Occurrence Basis, with X, C & U exclusions deleted (including completed operations, operations of subcontractors, blanket contractual liability insurance, owned, non- owned and hired motor vehicle liability, personal injury liability) with combined single limits against bodily injury and property damage of not less than $1,000,000 and with excess umbrella coverage raising the total coverage to not less than $5,000,000. This policy should have a Broad Form Endorsement and include the following coverages: Blanket Contractual Liability, Broad Form Site Damage, Completed Operations and Personal Injury. Such limits can be satisfied through excess liability policies; 50 for (iii) Comprehensive Automobile Liability hDeveloper of any auto with a bodily injury and property damage arising from the use y the combined single limit of One'_vlillion and 00;100 Dollars ($1,000,000.00) per accident; b ensation insurance covering all persons employed y (iv) Workers' comp coverages and limits, complyinn with State law; Developer with the required statutory Section 13.03 General Insurance Re uirements. (a) Each Party will provide certified copies of all policies of insurance required under u on request. For the property insurance required to be carried by this Article, to the other Party p Developer under Section 13.02(b)(i), Developer will cause its insurer(s) to provide the Town and to and agents with waivers of subrogation. its commissioners, directors, officers, emp yees an Developer will not obtain any property insurance that prohibits the insured frown under subrogation. For the property insurance required to be carried by provide the Section 13.02(a)(i) relating to the Improvements, Town will ecs uandtsagents insurer(s) t to waivers of with Developer and its directors, directors, officers, s, cosuprance that prohibits the insured from subrogation. Town will not obtain any property l waiving subrogation. ts, (b) The insurance coverages speclfiadm herein liability of Deve ope or how ul~dernthe and said requirements will in no way lessen o terms of this Agreement. Developer will procure pro~1ect thatnin its judgment may and d cesessary additional kinds and amounts of insurance on for its proper protection in the completion of the Project. (c) If any insurance required to be maintained by the any Party pursuant to this Article X1I1 (including the limits or any other terms under policies for such insurance) ceases to reasonable terms (a be available at all, or ceases to be available on he~h PaY shall prov de writtensnoUce to the below), in the commercial insurance market, then the other Party of the first Party's opinion to that effect. Such opinion shall include (and shall be based upon, among other things) a certificate from an independent insurance advisor of ertainin to the then current state of the commercial insurance recognized national standing p g market. The second Parry shall not unreasonably withhold its consent to modify such insurance requirement based upon the 's opinion and such related documentation. The first Party first Party shall, in any event, obtain and maintain such lesser coverage as is required pursuant toethis v~abeeXl~ commercially reasonable terms until the relevant insurance shall again becomes available on commercially reasonable purpose of this eupo tionn be obtain and maintain such insurance. For the pure considered to be not "available on commercially reasonable terms" if (1) it is ether onot r area or obtainable or obtainable only at excessive costs, or (ii) it is generally not being carried applicable to development projects or operations similar to and in the same geographic the Project. ntract employe (d) Each Party shall contractually require theoTownrs/ based on the type of by such party are properly insured l: limits commence work on the Project. work performed, before they are pted 51 (e) Each Party shall provide certificates of such insurance to the other Party, which certificates shall show the other Party as additional insured parties. (f) Each insurance policy required under this Article XIII shall be issued by an insurer of recognized responsibility licensed to issue the policy in the State, having a general policy holder's rating of not less than A- and a financial rating of VII or better as rated in the most current "Best's Key Rating Guide" or BBB or better from S&P, or Baa3 or better from Moody's. (g) At least five (5) days before any required insurance policy expires, each Party shall deliver to the other Party a certificate of insurance showing the effectiveness of the insurance required by this Agreement together with a new certificate of insurance showing the effectiveness of a replacement policy. (h) If a Party is paid any proceeds under any policy of insurance naming the other Party as an insured, on account of any loss, damage or liability, then the Party that is paid the proceeds hereby releases (or shall be required to release) the other Party, to the extent of the amount of such proceeds, or the amount of such proceeds which would have been paid if the required insurance was in effect, from any and all liability for such loss, damage or liability, notwithstanding that such loss, damage or liability may arise out of the negligent or tortious act or omission of the other Party. (i) A waiver of right of recovery clause stating that the insurance policy shall not be negated by such waiver shall be included in the insurance policies of each Party. Each Party waives its and its insurers' rights of subrogation against the other Party. 0) Every insurance policy maintained by Developer pursuant to this Agreement shall (i) provide that thirty (30) days advance written notice shall be given to Town of cancellation, modification, termination or lapse of coverage except that only ten (10) days advance written notice shall be required in the event of cancellation, modification, termination or lapse of coverage as a result of non payment of premium, and that such insurance, as to the interest of the Town, shall not be invalidated by any act or neglect of the Town or its respective agents, employees, officers and representatives, Developer or any other named insured, additional insured or loss payee, nor by any foreclosure or any other proceedings relating to the Site nor by any change in the Title to or ownership of the Site, nor by use or occupation of the Site for purposes more hazardous than are permitted by such policy; and (ii) in the event any insuring company is not domiciled within the United States of America, include a United States Service of Suit clause (providing any actions against the insurer by the named insured or the Town shall be conducted within the jurisdiction of the United States of America). (k) Every insurance policy maintained by the Town pursuant to this Agreement shall (i) provide that thirty (30) days advance written notice shall be given to Developer of cancellation, modification, termination or lapse of coverage except that only ten (10) days advance written notice shall be required in the event of non payment of premium, and that such insurance, as to the interest of Developer, shall not be invalidated by any act or neglect of Developer, its Affiliates or agents, the Town or any other named insured, additional insured or loss payee, nor by any foreclosure or any other proceedings relating to the Site nor by any 52 change in the Title to or ownership of the Site, nor by use or occupation of the Site for purposes more hazardous than are permitted by such policy; and (ii) in the event any insuring company is not domiciled within the United States of America, include a United States Service of Suit clause (providing any actions against the insurer by the named insured or Developer, its Affiliates or agents shall be conducted within the jurisdiction of the United States of America). (1) The insurance required in this Article XI1I may be provided under a combination of primary liability and excess liability policies and may be insured under a blanket insurance policy obtained by the Developer or its Affiliate or by Town, as the case may be. ARTICLE XIV EVENTS OF DEFAULT, REMEDIES AND TERNIII\ATION Section 14.01 Events of Default After Escrow Delivery Date. Each of the following, which occur after the Escrow Delivery Date, and which remain uncured after the expiration of all applicable cure periods, shall constitute an event of default ("Event of Default') under this Agreement: (a) Prior to the Date of Project Final Completion, Developer shall file a petition in bankruptcy or other petition for creditors' relief shall have been filed against Developer and shall not be dismissed within sixty (60) days, or any material written representation by Developer as to its financial condition shall have been false; and (b) Developer or the Town shall be in default of any of its material, respective duties or obligations hereunder, including but not limited to complying with Sections 5.02, 5.03, and 2.03(f), as pertains to the Developer, and Sections 4.06(a)(i) and 9.01, as pertains to the Town. Section 14.02 Default Notice. (a) If a default occurs under this Agreement, the non-defaulting Party shall deliver notice ("Default Notice") to the Party in default, specifying the nature of the alleged Event of Default, and in accordance with Section 16.03 below. Ile non-defaulting Party shall have no right to exercise any remedy for such default without delivering the Default Notice as provided herein. (b) The non-defaulting Party shall not have the right to exercise a remedy hereunder after delivery of a Default Notice if the default is commenced to be cured by the defaulting Parry within thirty (30) days and thereafter is diligently pursued to completion of cure within a reasonable time; except for Town's termination right due to the Developer's failure to convey, pursuant to Section 2.03(f), any remaining interest it has in the Conference Center (or the area of the Development Parcel where the Conference Center has been constructed) to the Metropolitan District(s) following the Date of Project Final Completion, for which the Developer shall have only ten (10) days to cure from delivery of the Default Notice. Section 14.03 Town's Option to Reenter and Repossess Portions of the Project (a) Following an Event of Default by Developer that occurs after the Escrow Delivery Date and prior to the Date of Project Final Completion, the Town shall have the right at 53 its option to take title, reenter and repossess any portions of the Public Improvements and Private Improvements that, at the time of default, have not been issued a Remaining Project Components TCO. (b) The Town agrees that the foregoing described right to take title, reenter and repossess certain portions of the Project shall apply only to portions of the Project that meet all of the following criteria: (i) have not been sold or ground-leased to third parties by Developer at the time the Town delivers notice or exercise of the right to Developer; and (ii) are not developed with buildings that have received a Remaining Project Components TCO or are under construction prior to the expiration of all applicable cure periods. (c) To exercise its right to take title, reenter and repossess any portion of the Project under this Section 14.03, the Town shall give written notice to Developer of its election to retake identified portions of the Project, and in accordance with Section 16.03 below. (d) The Town's right to take title, reenter and repossess any portion of the Project under this Section 14.03 shall be the Town's sole and exclusive remedy for an Event of Default, other than termination of this Agreement pursuant to Section 14.07 below. The Town's exercise of its rights under this Section 14.03 shall operate as a full and final release of Developer, its successors and assigns under this Agreement, and the Town shall have no other rights or remedies under this Agreement, other than termination of this Agreement pursuant to Section 14.07 below. If the Town does not elect to exercise its right to take Title and reentry under this Section 14.03, then the Town shall have no other remedies for an Event of Default, other than termination of this Agreement pursuant to Section 14.07 below, and the Town hereby waives all other rights and remedies, including but not limited to monetary damages. (e) Upon the revesting in the Town of Title to any portion of the Project as provided in this Section 14.03, the Town shall, pursuant to its responsibilities under Colorado law, use its best efforts to resell the same as soon and in such manner as the Town shall find feasible and consistent with the objectives of such law and to a qualified and responsible party or parties (as reasonably determined by the Town) who will assume the obligations of developing, making or completing the Public Improvements or Private Improvements in Developer's stead as shall be reasonably satisfactory to the Town and in accordance with the uses specified therefore in the Lionshead Redevelopment Master Plan. Upon such resale, the proceeds thereof shall be applied as follows: (i) First, to reimburse the Town, on its own behalf, for all costs and expenses incurred by the Town to third party consultants, including attorneys, in connection with the recapture, management and resale of the Project, less any income or gain derived by the Town therefrom or the improvements thereon in connection with such management, recapture or sale; all taxes, assessments and water or sewer charges with respect thereto which Developer has not paid; any payments made to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of Developer, its successors, assigns or transferees; and any expenditures made or obligations incurred with respect to the development, making or completion of the Public Improvements, Private Improvements or any part thereof on the Site; 54 (ii) Second, to reimburse Developer or its successors, assigns or transferees (if applicable), up to the amount equal to the costs incurred by Developer for the development of the Site, including any financing cost and outstanding debt service payments, and for the Improvements existing thereon at the for the Improvements thereon; and gains or income withdrawn or made by Developer iii Third, any balance remaining after such reimbursements shall be retained by the Town as its property. (f) If Developer's Event of Default occurs prior to the Date of Project Final Complction but following the date a Remaining Project Components TCO has been obtained for one of the Lodging hotels or the Retail Development, the ow caagrees t that any such hotel and shall not shall be in either the Smith Travel Research "Luxury" or "Upp p have more than 120 guest rooms. (g) Notwithstanding any other provision of this Agreement, the Town's right of reverter under this Section 14.03 and any proceedings hereunder shall terminate and be of no further force or effect upon the Date of Project Final Completion, and the Town shall have no further right of reverter. (h) The rights established in this Section 14.03 are to be interpreted in light of the fact that the fee interest in the Development Parcel and the development area of the Site where the Private Parking will be located are being conveyed to Developer for development, and not for speculation in undeveloped land. Section 14.04 Developer's Remedies. Following an Event of Default by Town that occurs after the Escrow Delivery Date and prior to the Date of Project Final Completion, Town shall pay to Developer liquidated damages in the amount of one hundred twenty-five percent (125%) of Developer's (or its Affiliate's) predevelopment and development costs incurred through the date of termination, as documented by an accounting Town enters into a letter the Developer. If within five years following such Event of Default, the intent or contract to develop the remaining portion of the property with an entity or individual other than the Developer or its Affiliates, Town shall pay to Developer additional liquidated damages in an amount equal to any payment or consideration received by Town for such development. THE PARTIES AGREE THAT DEVELOPER'S LIQUIDATED DAMAGES IN THE EVENT OF A DEFAULT BY THE TOWN IN ACCORDANCE WITH THIS Sa CTION 14.04 ARE DIFFICULT TO DETERMINE AND THE FOREGOING AMOUNTS OF LIQUIDATED DAMAGESLREPRESENT A OPER WOULD SL'FFOER UPON A DEFAULT OF THE ACTUAL DAMAGES THAT DE Section 14.05 Termination b the Town Prior to Escrow Delivery Date. (a) If in Town's reasonable estimation Developer has failed to comply with the Escrow Delivery Conditions set forth in Section 4.03(u) through Section 4.03(x) by the Escrow Delivery Date, Town may terminate this Agreement. (b) The right of termination set forth in this Section 14.05 shall be the Town's sole and exelisive remedy for a Developer's failure to meet such Escrow Delivery Conditions upon 55 Escrow Delivery. In no event shall the Town be entitled to damages, including but not limited to monetary damages of any kind or specific performance. Section 14.06 Termination by Developer Prior to Escrow Deliver Date. (a) Developer may terminate this Agreement prior to Escrow Delivery for any reason in its sole and absolute discretion and without penalty. In connection therewith Developer shall deliver hard copies (or electronic copies if Developer so elects), of the last version of all planning, design and development documents (other than Developer's Proprietary Information) concerning the Site and the Project to the Town, all without charge to the Town, and neither Party shall have any further obligation under this Agreement. (b) If in Developer's reasonable estimation at Escrow Delivery, Town has failed to comply with the Escrow Delivery Conditions set forth in Sections 4.03(a) through 4.03(t), Developer may terminate this Agreement pursuant to this Section. (c) The right of termination set forth in this Section 14.06 shall be the Developer's sole and exclusive remedy for Town's failure to meet such Escrow Delivery Conditions upon Escrow Delivery. In no event shall the Developer be entitled to damages, including but not limited to monetary damages or any kind or specific performance. (d) Notwithstanding anything in this Agreement to the contrary, if Developer terminates this Agreement prior to Escrow Delivery in accordance with this Section 14.06, Developer hereby agrees to reimburse the Town for any of its outside consultant costs relating to the Project or this Agreement that were incurred by the Town prior to such termination date in an amount not to exceed $50,000. (e) In the event that this Agreement terminates prior to Escrow Delivery while any Site Investigation is underway, Developer shall repair any damage to the Site caused by Developer or its agents requested by the Town. Section 14.07 Option to Terminate. Without limitation upon any other termination right set forth herein, Developer and Town will have the right to terminate this Agreement if an Event of Default by other Party occurs and is continuing, and any applicable cure period for the Event of Default has expired. Section 14.09 Action to Terminate. Notice of termination of this Agreement must be accomplished by written notification delivered to the other parties hereto in accordance with Section 16.03 below. Termination will be effective on the date specified in such notice. Section 14.09 Effect of Termination. If this Agreement is terminated pursuant to Section 14.05 or Section 14.06 hereof, then this Agreement will be null and void and of no further effect, and no action, claim or demand may be based on any term or provision of this Agreement; provided, however, that certain obligations set forth herein will survive termination.. Section 14.10 Scheduled Termination. If not otherwise terminated earlier as provided herein, this Agreement will terminate upon the Date of Project Final Completion. 56 Section 14.11 Survival After Termination. As set forth herein, the only provisions of this Agreement that survive termination are those that expressly include survival of termination language, as set forth in this Section or otherwise in this Agreement. (a) The Town's obligation to maintain the New Parking Structure (excepting the Private Parking) set forth in Section 9.02 shall survive any termination of this Agreement. (b) If any closing of any financing has occurred, the Metropolitan District(s) and Developer's obligations under any financing documents with respect to such financing will survive any termination of this Agreement. ARTICLE XV RESTRICTIONS ON ASSIGNMENT AND TRANSFER Section 15.01 Representations as to Development. Developer's undertakings under this Agreement are for the purpose of development of the Site and not for land holding or speculation. Developer and Town acknowledge that: (b) The development of the Site is important to the general welfare of the Town and Developer, and is consistent with the Lionshead Redevelopment Master Plan; (c) The Developer intends to make available substantial financing and other aids to make the development possible; and (d) It is because of the qualifications and identity of Developer that the Town is entering into this Agreement with Developer, and is willing to accept and rely on the obligations of Developer for the faithful performance of all of its undertakings and covenants under this Agreement. Section 15.02 Limitation on Assignment. Except as otherwise provided in this Section 15.02, prior to the Date of Project Final Completion, Developer will not assign its rights or delegate its duties and obligations under this Agreement without the prior written consent of the Town, not to be unreasonably withheld, delayed or conditioned. Any purported assignment without consent of the Town will be null and void. As a condition to the Town granting consent, an assignee will expressly assume in writing the obligations of Developer hereunder. For purposes of this Section 15.02, any sale, transfer, assignment, pledge or hypothecation of an interest in Developer (other than to an Affiliate of Developer) that results in a change in management control of Developer will constitute an assignment of this Agreement. Notwithstanding the foregoing: (b) Following the Date of Project Final Completion, Developer may freely convey the Private Improvements, assign its rights, and delegate its duties and obligations under this Agreement without the Town's consent. (c) Developer may at any time without the Town's consent, convey any interest it has in the Site and Project, or Developer's interest in any portion of the Site or Project, or assign its rights, and delegate its duties and obligations under this Agreement to an Affiliate, or to or from an accommodator or intermediary for purposes of carrying out an Internal Revenue Code 57 Section 1031 exchange provided that, at the conclusion of the exchange transactions, the Site, Project or portion of either thereof shall be owned by an Affiliate or another transferee otherwise permitted hereunder. (d) No consent will be required under this Section 15.02 for any pledge or assignment of this Agreement as collateral security for Developer's financing that is consistent with the terms of the Finance Plan. Section 15.03 Effect Upon Obligations. In the event of any assignment that is approved, deemed approved or permittcd hereunder, Developer shall be released from any further liability or obligation under this Agreement upon execution by the assignee of a document (in a form reasonably acceptable to the Town) by which the assignee agrees to assume those of Developer's obligations under this Agreement that are being assigned to the assignee from and after the date of the assignment. ARTICLE XVI MISCELLANEOUS Section 16.01 Amendment of Agreement. Except as otherwise set forth in this Agreement, this Agreement may not be amended or terminated except by mutual consent in writing of Developer and the Town, following the public notice and public hearing procedures required for approval of the Approved Development Plan, or this Agreement, as applicable. Section 16.02 No Implied Waiver. No provision of this Agreement will be construed as an implied waiver by Developer of its right to any payment, reimbursement, tax or fee waiver, or reimbursement to which it is otherwise entitled by law or as an implied waiver or acquiescence in the impairment of any of its substantive or procedural rights under the Local Government Land Use Control Enabling Act of 1974, sections 29-20-104.5 and 29-20-201 through 204, C.R.S., as amended, or as an implied agreement by Developer to be responsible for more than its proportionate share of any regional public infrastructure improvements or to be responsible for the costs of improvements that are not roughly proportional to the direct impacts of the development of the Project. Section 16.03 Notices. Any notice (a) shall be in writing; (b) shall be sent by (i) certified or registered mail in the United States mails, postage prepaid, return receipt ` requested, or (ii) by Federal Express or another national courier service, or (iii) (if such Party's 4 receipt thereof is acknowledged by a signed delivery receipt) upon having been given by hand or I other actual delivery to such Parry; in each case to the address of such Party set forth herein below or to such other address in the United States of America as such party may designate from time to time to each other Party. Any Notice sent by the method described in (i) above shall be effective two (2) Business Days after mailing. Any Notice sent by the method described in (ii) above shall be effective on the next Business Day after having been sent; and any Notice sent by the method described in (iii) above shall be effective upon delivery. Failure to provide notice under this Agreement shall not be considered an Event of Default hereunder. 58 If to Developer, to: OHP VAIL ONE, LLC 2525 McKinnon Street Suite 750 Dallas, Texas 75201 Attn: Mark Masinter With a copy to: Kaplan Kirsch & Rockwell LLP 1675 Broadway, Suite 2300 Denver, Colorado 80202 Attn: Stephen H. Kaplan And a copy to: Bailey & Peterson, P.C. 108 South Frontage Road Suite 208 Vail, Colorado 81657 Attn: Jay Peterson If to the Town, to: Town of Vail, Colorado 75 South Frontage Road Vail, Colorado 81657 and public Works Director Attn: Town. Manager, Town Attorney right that Waiver. No party shall have waived the exercise of any ng the Section 16.04 l and in writing (and, without limiti n expressly rty hereto in exercising any suc by ress any pa delay h right it holds hereunder unless such r or is made omission hereto to insist upon the generality of the foregoing, No failure by any Party or to shall be deemed a waiver of its o future eduty,sagreement or condition of this Agreement, strict performance of any consequent upon a breach of this Agreement, will constitute a exercise any right or remedy other covenant, agreement, term or condition. Any waiver of any such breach or of such or any but will not be required to, waive any of its rights party by giving notice to the other Parties may, teml and condition of this 1 conditions to any of its obligations hereunder. NO wa1v v other then existing or re any mainder of this Agreement, but each and every covenant, agreement, re Agreement will continue in full force and effect with respect to an, subsequent breach. proceeding brought to enforce the Section 16.05 Attome s Fees. prevailing party (whether by judgment or provisions of this Agreement, the court will award the 59 out of court settlement) therein reasonable attorneys' fees, actual court costs and other expenses incurred. Section 16.06 Conflicts of Interest. The Town will not allow, and except as disclosed in writing to the Town, Developer will not knowingly permit, any of the following persons to have any interest, direct or indirect, in this Agreement: a member of the governing body of the Town; an employee of the Town who exercises responsibility concerning the Project; or an individual or firm retained by the Town who has performed consulting or other professional services in connection with the Project. The Town will not allow and Developer will not knowingly permit any of the above persons or entities to participate in any decision relating to this Agreement that affects his or her personal interest or the interest of any corporation, partnership or association in which he or she is directly or indirectly interested. Section 16.07 Titles of Sections. Any titles of the several parts and Sections of this Agreement are inserted for convenience and reference only and will be disregarded in construing or interpreting any of its provisions. Section 16.08 Town Not a Partner;. Developer Not Town's Anent. Notwithstanding any language in this Agreement or any other agreement, representation or warranty to the contrary, the Town will not be deemed or construed to be a partner or joint venturer of Developer, Developer will not be the agent of the Town, and the Town will not be responsible for any debt or liability of Developer. Section 16.09 Applicable Law; Venue. The laws of the State will govern the interpretation and enforcement of this Agreement. Venue for any action arising under this Agreement or any amendment or renewal hereof shall be in the District Court of Eagle County, Colorado; provided, that if any such action or proceeding arises under the Constitution, laws or treaties of the United States of America, or if there is a diversity of citizenship between the parties thereto, so that it is to be brought in a United States District Court, it shall be brought in the United States District Court for the District of Colorado or any successor federal court having original jurisdiction. Section 16.10 Binding Effect. This Agreement will be binding on and inure to the benefit of the parties hereto, and their successors and assigns, subject to the limitations on assignment of this Agreement by Developer set forth in Section 15.02. Section 16.11 Further Assurances. The parties hereto agree to execute such documents, and take such actions, as will be reasonably requested by the other party hereto to confirm or clarify the intent of the provisions hereof and to effectuate the agreements herein contained and the intent hereof. Section 16.12 Severability. If any provision, covenant, agreement or portion of this Agreement, or its application to any person, entity or property, is held invalid, such invalidity will not affect the application or validity of any other provisions, covenants or portions of this Agreement and, to that end, any provisions, covenants, agreements and portions of this Agreement and declared to be severable. 60 Good Faith- Consent or A roval• In performance of this Section 16.13 Agreement. or in considering any requested extension of time, the Parties agree that each will act capriciously or unreasonably withhold or in good faith and will not act unreasonably, arbitrarily, approval required by this Agr ° eement, whenever obligations in Section 2.03( anlexc pt those related to the Developer's delay any Except as otherwise provided in th2.03(1). c not will bly onsent or approval of any Party is required, such consent and acknowledges that in each instance in t to give its withheld, conditioned or delayed. Developer agrees or has the r this Agreement or elsewhere where the Town is required will imply o gibe deemed to constitute approval or consent, no such review, approval or consent r responsibility for the design or an opinion by the Town, nor impose upon the Town, any construction of building elements, including, but not limited to, the structural integrity licabl or cing compli any app life/safety requirements or adequacy of b o budgets in uding the Environmental Laws. All federal or State law, or local ordinance Agreement are for the sole reviews, approval and consents by the Town under the terms of this ill have the exe uted byorthparty T wown Manager and exclusive benefit of Developer or its assignee e other right to rely thereon. Delivery of a no articular activity, action, plan or other item purporting to provide approval or disapproval of any p rox Aed for hereunder may be relied upon by Developer as conclusive evidence of such P approval or disapproval by the Town. Section 16.14 Counte arts. This Agreement may be executed in several counterparts, each of which will be an original and all of which will constitute but one and the same instrument. Section 16.15 Non-Liability of Town Officials and Em to ees. No council to ee, agent of consultant of the 'T'own will member, commissioner, board member, official, emp Y be personally liable to Developer in an Event of a Default by to Town or for any amount that may become due to Developer under the terms o this Agreemen Incorporation of Exhibits . All exhibits attached to this Section 16.16 of this Agreement. Agreement are incorporated into and made a part Section 16.17 Jointly Drafted Rules of Construction. Thelic Parties on of anyal~aw, that this Agreement was jointly drafted, and, thereforethat, ambiguities waive the app in an agreement or ott=er regulation, holding, or rule of construction providing agreement or document. document will be construed against the party drafting such II Section 16.18 Brokers. Town shall not be responsible for the cost of anymreal of any contemplated 1 estate broker's commissions under the transactions b broker's commissions to Developer shall have no responsibility for payment any real estate broker acting as an agent on becalm oafn y thcl~wn related to sl Site. iability, losor dam gevans ng 1 shall indemnify and hold the Town harmless fro individual or entity from any claim or assertion for a brokerage commission or fee from any in claiming by, through or under Developer. Section 16.19 ~lon-Discrimination. The Developer hereby covenant and ones es that there shall be no discrimination against or segregation of any person or group p 61 account of race, color, creed, religion, sex, marital status, national origin, ancestry, age, or handicap, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Site, nor shall the Developer or any person claiming under or through the Developer, establish or permit any such practice or practices of discrimination or segregation in the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees of the Site. Section 16.20 Confidentiality of Materials. (a) Generally. Certain materials and information to be provided to the Town and by the Developer under this Agreement are confidential and proprietary in nature. For any document or information that Developer provides to Town and marks as "Confidential - Developer's Proprietary Information," the Town will use all reasonable efforts to ensure that such documents and information are kept confidential and proprietary to the maximum extent protected pursuant to law, including, without limitation, the Colorado Open Records Act and the Colorado Open Meetings Law set forth at Title 24, Article 6, Sections 401 through 402 of the Colorado Revised Statutes. If Developer delivers Developer's Proprietary Information to the Town, Town shall hold such information separate from other Developer information received by Town, and shall file such information in a file marked "Confidential-OH? VAIL ONE, LLC Proprietary Information-Not to be Released Without Consent." Town shall use commercially reasonable efforts to ensure that copies of Developer's Proprietary Information are not kept by individual Town officials or employees from Town's designated file for holding such information. The obligations set forth in this Section 16.20 shall survive any termination of this Agreement. (b) Open Records Information. If Town or Developer receives a written request under the provisions of State law relating to access to public records appearing at 24-72-101 et seq. CRS, for information pertaining to the Project, the Town or Developer, as the case may be will promptly inform the other Party thereof. The Parties will meet and confer to determine the timing and appropriate response to the request. Section 16.21 Effectiveness: Complete Understanding. This Agreement shall become effective on and only on its execution and delivery by each Party. This Agreement represents the complete understanding between the Parties hereto as to the subject matter hereof, and supersedes all prior negotiations, representations, guaranties, warranties, promises, statements or agreements, either written or oral, between the Parties as to the same. No inducements, representations, understandings or agreements have been made or relied upon in the making of this Agreement, except those specifically set forth in this Agreement. Neither Party has any right to rely on any other prior or contemporaneous representation made by anyone concerning this Agreement that is not set forth herein. Notwithstanding the forgoing, nothing herein shall restrict the rights of the Parties to enter into supplementary agreements to confirm, elaborate, verify or modify the scope of the Project, provided that they follow applicable Town requirements. Section 16.22 Time of the Essence. (a) Time shall be of the essence in the performance of this Agreement. 62 of subsection (a) of this Section 16.22, delays (b) Notwithstanding the provisions the time when the ca by a date oucr fixed used by or resulting from Force Majeure shall etnot heresucoted chtimui sdedetermining d g t s date, performan ce of such act shall be complete i the delayed time a or fi perxediod i period of time or "a reasonable time," unless it is expressly providstateed d of time, not be extended due to Force Ma'eure; and further the e other party of such delays and the cause thereof thi 60)r than sixty Busuicss llays, and party notifies o time following a T'orce'_vlajeure but in any event not more p uses commercially reasonable efforts and all due diligence to effect the (ii) the delayed arty required performance. ions 16.23 Covenants Rennin With the L ended do be covenants obligaaingtwith rum Section of the Town hereunder touch and concern the Site and are intend the Toy; n and its respective Unless the Site or portion thereof is release be from i geon obligations of this Agreement, provisions hereof shall be for the benefit of and the land. successors as owners or holders of interests in the Site and shall be fully enforceable by Developer against the then current owner or owners of the Site. ecording. A memorandum of this Agreement shall be recorded Section 16.24 R---- Colorado. in the real property records of Eagle County, [END OF DEVELOPMENT IMPROVEMENT AGREEMENT] 63 IN WITNESS WHEREOF, each Party has executed this Development Improvement Agreement or caused it to be executed, under seal, on its behalf by its duly authorized representatives as of the 16th day of October, 2007. TOWN OF VAIL, COLORADO: [SIGNATURE PAGE TO DEVELOPMENT IMPROVEMENT AGREEMENT] 64 By:_ A ~Z' / Name: S e ZR4--t- Title: 5vWI, 4 tiq Sp-'. ExMBIT A SITE DESCRIPTION The Site is legally described as follows: PARCEL 1: BLOCK 1, VAIL/LIO~ISHEAD, SECOND FILING, LOT 3, A RESLBDiVISION OF LOT 1, ACCORDING TO THE PLAT RECRODED JANUARY 17, 1975 IN BOOK 238 AT PAGE 328, COUNTY OF EAGLE, STATE OF COLORADO. PARCIrL 2: LOT 1, BLOCK 2, VAIL/LIONSHEAD FIRST FILING 676, ACC COLRNTYT OF EAGLE, STATE OF RECIRDED MAY 18, 1979 I;J BOOK 217 AT PA COLORADO EXHIBIT B SITE MAP EXHIBIT C PROJECT DESCRIPTION (HE EXH BITIS O'_v ILE IN THE OFFICE OF THE TOWN MANAGER) AND THE EXHI EXHIBIT C-1 PROPOSAL (INCORPORATED BY REFERENCE AS IF ATTACHED HERETO, AND THE EXHIBIT IS ON FILE IN THE OFFICE OF THE TOWN MANAGER) EXHIBIT C-2 SUPPLEMENT (INCORPORATED BY REFERENCE AS IF ATTACHED HERETO, AND THE EXHIBIT IS ON FILE IN THE OFFICE OF THE TOWN MAINAGER) EXHIBIT C-3 TRAFFIC PATTERNS AND PARKING PROGRAM (INCORPORATED BY REFERENCE AS IF ATTACHED HERETO, AND THE EXHIBIT IS ON FILE IN THE OFFICE OF THE TOWN MANAGER) EXHIBIT D CONFERENCE CENTER SUMMARY 1. THE VAIL CONFERENCE CENTER-- FACILITY CHARACTERSITICS A. General The Vail Conference Center will accommodate a wide range of events. The proposed facility will have meeting space that is divided in both general session space and meeting/ breakout spaces capable of supporting conferences and meetings. The Vail Conference Center will have pre-function space suitable for attendee registration, kitchen facilities for event catering and presentation equipment suitable for both large groups and breakout sessions. The main meeting space / ballroom will be divisible in order to support simultaneous events. In total, the Vail Conference Center is proposed to have approximately 34,000 total gross square feet of ballroom, breakout, pre-function, and back-of-the-house space, as may be amended and supplemented by the Conference Center Agreement. The Vail Conference Center is being designed and programmed to have facilities that are similar or better than other conference centers in comparable resort settings. According to HVS Convention, Sports and Entertainment Facilities Consulting Division, Vail's peer comparable resort conference facilities include Banff Centre, Monterey Conference Center, Snowmass Conference Center, Telluride Conference Center, Keystone Conference Center and Whistler Conference Center. The quality of design, materials, finishes, furnishings and equipment being planned is to be comparable in quality, or better, than these resort conference facilities. B. Main Ballroom The Main Ballroom/Exhibit Space will serve as both a large banquet area and an area for exhibits. The space will have ceilings of approximately twenty-five feet in height and clear spans with limited numbers of support columns in the room. The quality level of the space will be appropriate for Vail's finest formal dinners and social functions. The space will have attractive and durable carpeting and will appear like a true ballroom rather than an exhibit hall. The space will be divisible with soundproof movable walls. Loading docks will be positioned strategically to enable easy loading and unloading of exhibit materials. There will be sound attenuation and a sophisticated sound and AV system. There will be a kitchen facility in close proximity to the ballroom space, which will insure efficient delivery of food service. There will be extensive utility service in the ballroom space including but not limited to electricity, telecommunications, hookups and water. C. Meeting/Breakout Rooms These rooms will vary in size from approximately 500 to 2,000 square feet. They will be divisible into smaller units in order to provide maximum flexibility. They will be carpeted and have a high level of finish. The majority of the meeting spaces will have flat floors and no fixed seating so that they can be configured for an assortment of meeting needs. Meeting rooms will have variable lighting setups, sound attenuation, and sophisticated sound and AV systems. The Boardrooms will be elegant meeting rooms with formal conference tables and seating. 2. VAIL CONFERENCE CENTER POSITIONING Vail is a highly attractive location for event planners as both a resort destination and a corporate/executive meeting destination. The Vail Conference Center will be positioned and marketed as a combination executive and resort conference center. As an executive conference center, the Vail Conference Center will provide facilities needed for mid-to upper-level executive managerial meetings, including strategic planning, forecasting and budgeting, sales and marketing, state-of-the corporation reports, new product introductions and educational and training seminars. Clients will be corporations, associations, government, institutions and social uses.