Exhibit 10(kkk)
HOTEL PRE-OPENING SERVICES AGREEMENT
Between
FOUR SEASONS HOTELS LIMITED
And
CIRCUS CIRCUS ENTERPRISES, INC.
FOUR SEASONS RESORT, LAS VEGAS
TABLE OF CONTENTS
ARTICLE I - DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . 3
1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . 3
1.02 Recitals. . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.03 Interpretation. . . . . . . . . . . . . . . . . . . . . . . 3
1.04 Schedules . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE II - TERM AND TERMINATION PRIOR TO OPENING DATE. . . . . . . . . 5
2.01 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.02 Termination Prior to Opening Date . . . . . . . . . . . . . 6
ARTICLE III - CIRCUS' RESPONSIBILITY, RIGHTS OF
APPROVAL AND STANDARD OF DESIGN BRIEFS . . . . . . . . 6
3.01 Circus' Responsibility. . . . . . . . . . . . . . . . . . . 6
3.02 Rights of Consultation. . . . . . . . . . . . . . . . . . . 6
3.03 Standard of Hotel Design Brief. . . . . . . . . . . . . . . 7
ARTICLE IV - PRE-OPENING PLAN AND BUDGET . . . . . . . . . . . . . . . . 7
4.01 Pre-Opening Plan and Budget . . . . . . . . . . . . . . . . 7
ARTICLE V - PROJECT ANALYSIS & SCHEMATIC DESIGN PHASE . . . . . . . . . 11
5.01 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.02 Circus' Obligations . . . . . . . . . . . . . . . . . . . . 11
5.03 Four Seasons' Obligations . . . . . . . . . . . . . . . . . 13
5.04 Four Seasons' Personal Property Obligations . . . . . . . . 15
ARTICLE VI - DESIGN DEVELOPMENT & WORKING DRAWINGS PHASE . . . . . . . . 15
6.01 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.02 Circus' Obligations . . . . . . . . . . . . . . . . . . . . 16
6.03 Four Seasons' Obligations . . . . . . . . . . . . . . . . . 17
6.04 Four Seasons' Personal Property Obligations . . . . . . . . 19
ARTICLE VII - CONSTRUCTION PHASE . . . . . . . . . . . . . . . . . . . . 20
7.01 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
7.02 Circus' Obligations . . . . . . . . . . . . . . . . . . . . 20
7.03 Four Seasons' Obligations . . . . . . . . . . . . . . . . . 23
7.04 Four Seasons' Personal Property Obligations . . . . . . . . 24
ARTICLE VIII - POST-OPENING DEFICIENCIES PHASE . . . . . . . . . . . . . 25
8.01 Post-Opening Deficiency Phase . . . . . . . . . . . . . . . 25
8.02 Circus' Obligations . . . . . . . . . . . . . . . . . . . . 26
8.03 Four Seasons' Obligations . . . . . . . . . . . . . . . . . 26
ARTICLE IX - DESIGNATED MANAGERS AND CO-ORDINATORS . . . . . . . . . . . 27
9.01 Circus' Responsibilities . . . . . . . . . . . . . . . . . 27
9.02 Four Seasons' Responsibilities. . . . . . . . . . . . . . . 27
9.03 General Co-ordination . . . . . . . . . . . . . . . . . . . 28
ARTICLE X - DEFICIENCIES . . . . . . . . . . . . . . . . . . . . . . . . 28
10.01 Deficiencies 28
ARTICLE XI - REMUNERATION AND REIMBURSEMENT OF FOUR SEASONS. . . . . . . 29
11.01 Consulting Fee . . . . . . . . . . . . . . . . . . . . . . 29
11.02 Personal Property Services Fee . . . . . . . . . . . . . . 29
11.03 Reimbursement of Costs . . . . . . . . . . . . . . . . . . .30
11.04 Fund for Pre-Opening Costs and Expenses . . . . . . . . . . 31
11.05 Interest . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE XII - DAMAGE TO AND DESTRUCTION OF THE HOTEL . . . . . . . . . . 31
12.01 Four Seasons' Entitlement to Fees and Charges
During a Delay Resulting From Damage or Destruction . . . . 31
ARTICLE XIII - EXPROPRIATION . . . . . . . . . . . . . . . . . . . . . . 32
13.01 Four Seasons' Entitlement to Fees and
Charges During a Temporary Expropriation. . . . . . . . . . 32
ARTICLE XIV - INSURANCE. . . . . . . . . . . . . . . . . . . . . . . . . 32
14.01 Coverage . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE XV - ASSIGNMENTS AND MORTGAGES . . . . . . . . . . . . . . . . . 32
15.01 Circus' Right to Assign . . . . . . . . . . . . . . . . . . 32
15.02 Circus' Right to Mortgage . . . . . . . . . . . . . . . . . 33
15.03 Limitation on Circus' Right to Assign and Mortgage . . . . 34
15.04 Four Seasons' Right to Assign . . . . . . . . . . . . . . . 35
15.05 Four Seasons' Right to Mortgage . . . . . . . . . . . . . . 35
15.06 Limitation on Four Seasons' Right to Assign . . . . . . . . 36
ARTICLE XVI - EVENTS OF DEFAULT AND TERMINATION. . . . . . . . . . . . . 36
16.01 General . . . . . . . . . . . . . . . . . . . . . . . . . . 36
16.02 Rights of Non-Defaulting Party . . . . . . . . . . . . . . 38
16.03 Remedying Defaults . . . . . . . . . . . . . . . . . . . . 38
16.04 Bona Fide Dispute . . . . . . . . . . . . . . . . . . . . . 38
16.05 Four Seasons' Right to Terminate . . . . . . . . . . . . . 39
16.06 Cross-Termination . . . . . . . . . . . . . . . . . . . . . 40
16.07 Accounting on Termination . . . . . . . . . . . . . . . . . 40
16.08 Claims on Termination . . . . . . . . . . . . . . . . . . . 40
ARTICLE XVII - APPROVALS, DISPUTE RESOLUTION AND ARBITRATION . . . . . . 41
17.01 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 41
17.02 Dispute Resolution . . . . . . . . . . . . . . . . . . . . .43
17.03 Legal Proceedings and Arbitration . . . . . . . . . . . . . 44
ARTICLE XVIII - FOUR SEASONS' LIABILITY. . . . . . . . . . . . . . . . . 46
18.01 Standard of Care . . . . . . . . . . . . . . . . . . . . . 46
18.02 Indemnities . . . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE XIX - ACKNOWLEDGMENTS. . . . . . . . . . . . . . . . . . . . . . 48
19.01 Circus' Acknowledgments . . . . . . . . . . . . . . . . . . 48
19.02 Four Seasons' Acknowledgments . . . . . . . . . . . . . . . 48
ARTICLE XX - GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . 49
20.01 Entire Agreement . . . . . . . . . . . . . . . . . . . . . 49
20.02 Modification and Changes . . . . . . . . . . . . . . . . . 49
20.03 Partial Invalidity . . . . . . . . . . . . . . . . . . . . 49
20.04 Counterparts . . . . . . . . . . . . . . . . . . . . . . . .50
20.05 Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . 50
20.06 Enurement . . . . . . . . . . . . . . . . . . . . . . . . . 50
20.07 Applicable Law . . . . . . . . . . . . . . . . . . . . . . 51
20.08 Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . 51
20.09 Designation of Agent for Service of Process . . . . . . . . 52
20.10 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 53
20.11 Time of Essence . . . . . . . . . . . . . . . . . . . . . . 54
20.12 Estoppel Certificates . . . . . . . . . . . . . . . . . . . 55
SCHEDULE "A" - Definitions
SCHEDULE "B" - Hotel Design Brief
HOTEL PRE-OPENING SERVICES AGREEMENT
THIS AGREEMENT is made as of this 1st day of January, 1997.
B E T W E E N:
FOUR SEASONS HOTELS LIMITED, a corporation
incorporated under the laws of the Province of
Ontario, Canada, having its principal offices at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇,
("Four Seasons"),
- and -
CIRCUS CIRCUS ENTERPRISES, INC., a corporation
incorporated under the laws of the State of Nevada,
United States of America, having its principal offices
at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇.▇.▇. ▇▇▇▇▇,
("Circus").
RECITALS
A. Circus and/or its Affiliates (as defined below) are the legal and
beneficial owners of the Land (as defined below) situated in Las Vegas,
Nevada (as defined below), and on or before the Opening Date (as defined
below), Owner (as defined below), a direct wholly-owned subsidiary of
Circus, will be the legal and beneficial owner of the Hotel (as defined
below).
B. Circus now proposes to develop upon the Land the Project (as defined
below) consisting of: (i) a World Class Luxury Hotel (as defined below)
containing approximately 429 guest rooms, together with two restaurants,
a bar, an entertainment lobby and lounge, approximately 28,000 square
feet of banquet, meeting and other public rooms, a private fitness club,
spa and pool area, together with a pool bar and grille, valet parking
and other facilities to be developed, constructed, furnished and
equipped in accordance with the Hotel Design Brief (as defined below),
(ii) an additional first class hotel containing approximately 3,300
guest rooms and other facilities, such World Class Luxury Hotel and
additional first class hotel to be situated in the same building, (iii)
a casino of approximately 100,000 square feet, (iv) a fitness and spa
facility which shall include a large pool area, (v) various restaurants
and other food and beverage facilities, (vi) various retail areas and
other related facilities, and (vii) parking facilities.
C. Four Seasons, together with its Affiliates (as defined below), has
expertise in the various phases of the development, construction,
furnishing, equipping, servicing, marketing, operation, management,
supervision and direction of World Class Luxury Hotels.
D. Contemporaneously with the execution of this Agreement, Owner and Circus
have entered into an agreement (the "Hotel Management Agreement") with
Four Seasons, pursuant to which Four Seasons (for certain fees) has
agreed to provide to Owner certain services with respect to the
operation and management of the Hotel.
E. Contemporaneously with the execution of this Agreement, Owner has
entered into an agreement (the "Hotel License Agreement") with Four
Seasons, pursuant to which Four Seasons (for certain fees) has agreed to
provide to Owner the right and licence to use the Trademarks (as defined
below) and utilize the Proprietary Materials (as defined below) for the
marketing, operation and management of the Hotel.
F. Circus also wishes to obtain the benefit of Four Seasons' expertise in
providing services in connection with the development and construction
of World Class Luxury Hotels and certain other services with respect to
the pre-opening acquisition of Furniture, Fixtures and Equipment (as
defined below) and Operating Equipment and Supplies (as defined below),
and Four Seasons (for certain fees) has agreed to provide such services
to Circus with respect to the Hotel, upon and subject to the terms and
conditions set forth in this Agreement.
AGREEMENT
NOW THEREFORE in consideration of the covenants and agreements set
forth in this Agreement, the parties agree that:
ARTICLE I
DEFINITIONS
1.01 Definitions
All capitalized terms herein shall, unless otherwise indicated,
have the meaning set forth in the Hotel Management Agreement. In this
Agreement, the terms in Schedule "A" attached hereto shall have the respective
meanings indicated therein.
1.02 Recitals
Four Seasons and Circus each represent and warrant to the other
that the Recitals to this Agreement, insofar as they relate to it, are true
and correct.
1.03 Interpretation
In this Agreement, save and except as otherwise expressly
provided:
(a) all words and personal pronouns relating thereto shall be read and
construed as the number and gender of the party or parties
requires and the verb shall be read and construed as agreeing with
the required word and pronoun;
(b) the division of this Agreement into Articles and sections and the
use of headings is for convenience of reference only and shall not
modify or affect the interpretation or construction of this
Agreement or any of its provisions;
(c) when calculating the period of time within which or following
which any act is to be done or step taken pursuant to this
Agreement, the date which is the reference day in calculating such
period shall be excluded. If the last day of such period is not a
business day, the period in question shall end on the next
business day;
(d) all monetary amounts are expressed in United States Dollars. All
payments of sums, charges, fees, costs, expenses and other amounts
contemplated by this Agreement shall be paid in United States
Dollars. If, pursuant to the judgment or order of any court or
otherwise, any amount due or payable hereunder in United States
Dollars (the "Original Currency") is paid in any other currency
(the "Second Currency"), such payment in the Second Currency shall
discharge or satisfy the obligation of the party making such
payment to pay such amount in the Original Currency only to the
extent of the United States Dollar Equivalent of the amount of
such payment in the Second Currency. The party making such
payment shall, as a separate and independent obligation, which
shall not be merged in any such judgment or order or extinguished
by any such payment in the Second Currency, pay or cause to be
paid such obligation in respect of the Original Currency not so
discharged and satisfied in accordance with the foregoing and
indemnify the party receiving such payment and hold the party
receiving such payment harmless from and against any losses,
costs, damages or expenses which the party receiving such payment
may sustain or incur as a result of any such amount being paid in
the Second Currency;
(e) all references to Article and section numbers refer to Articles
and sections of this Agreement, and all references to Schedules
refer to the Schedules attached hereto; and
(f) the words "herein," "hereof," "hereunder," "hereinafter", "hereto"
and words of similar import refer to this Agreement as a whole and
not to any particular Article or section hereof.
1.04 Schedules
The following schedules are attached hereto and are incorporated
in and are deemed to be an integral part of this Agreement:
Schedule "A" - Definitions
Schedule "B" - Hotel Design Brief
ARTICLE II
TERM AND TERMINATION PRIOR TO OPENING DATE
2.01 Term
The term of this Agreement shall commence on the date hereof and
shall expire three (3) months after the Opening Date.
2.02 Termination Prior to Opening Date
If the other Hotel Agreements are terminated in accordance with
their terms prior to the Opening Date, then this Agreement shall terminate on
the date of such termination and Circus and Four Seasons shall have no future
obligations arising out of this Agreement, save and except as otherwise
expressly provided for in this Agreement.
ARTICLE III
CIRCUS' RESPONSIBILITY, RIGHTS OF
APPROVAL AND STANDARD OF DESIGN BRIEFS
3.01 Circus' Responsibility
Circus shall cause the Hotel to be developed, constructed,
furnished and equipped in accordance with the Construction and Design
Standards and the Hotel Design Brief, and shall fulfil all of its obligations
under this Agreement. Any Dispute concerning the performance by Circus of its
obligations under this section shall, if requested by either Circus or Four
Seasons, be resolved by arbitration in accordance with the provisions of
section 17.03(b).
3.02 Rights of Consultation
The following matters, which are to be determined and revised from
time to time, are subject to the approval of Circus after consultation with
Four Seasons, as provided herein:
(a) the Schematic Design Drawings and the Design Development & Working
Drawings and Specifications;
(b) the operating pro forma and supporting rationale for the Hotel;
(c) the Personal Property Budget and the designs for the Personal
Property;
(d) the Project Budget and the Pre-Opening Plan and Budget;
(e) the selection of, and basic contract terms with, the Consultants;
and
(f) the insurance program for the Hotel prior to the Opening Date.
3.03 Standard of Hotel Design Brief
Circus and Four Seasons acknowledge and agree that the
Construction and Design Standards and the Hotel Design Brief contemplate the
construction of a world class luxury hotel comparable to the hotels and
resorts operated and managed by Four Seasons or any Affiliate thereof under
the name "Four Seasons" in North America.
ARTICLE IV
PRE-OPENING PLAN AND BUDGET
4.01 Pre-Opening Plan and Budget
(a) Within 30 days after the execution of this Agreement, Four Seasons
shall prepare and submit to Circus a preliminary version of the
pre-opening plan and budget (the "Proposed Pre-Opening Plan and
Budget", which shall become the approved pre-opening plan and
budget (the "Pre-Opening Plan and Budget") once the same has been
approved or deemed to have been approved by Circus in accordance
with this Agreement) which shall set forth in reasonable detail
plans and expenses proposed to be incurred for:
(i) the staffing of the Hotel prior to the Opening Date,
including (without limitation) the training of the staff
(together with an organizational chart of Hotel personnel
required to staff the Hotel prior to the Opening Date), a
schedule of anticipated dates for the commencement of full
time service by such personnel, a schedule of the
compensation to be paid to such personnel (including,
without limitation, the cost of any re-allocation assistance
to be provided to such personnel) and any other information
related to such personnel;
(ii) the promotion of the Hotel prior to the Opening Date,
including (without limitation) proposed corporate sales,
marketing and advertising programs, printed material, travel
and business entertainment programs;
(iii) the organization of the Hotel's operations prior to the
Opening Date and services, including (without limitation)
those to be operated by tenants, subtenants, licensees or
concessionaires; and
(iv) the partial operation of the Hotel prior to the Opening Date
for the purpose of staff training and operational and
promotional development.
Four Seasons may submit the Proposed Pre-Opening Plan and Budget
to Circus in portions from time to time as each portion is
completed; provided that each portion thereof so submitted shall
be cumulative in nature, and shall reflect any changes in portions
thereof previously submitted and approved or deemed to have been
approved by Circus in accordance with this Agreement until a
complete and overall version of the Proposed Pre-Opening Plan and
Budget has been submitted.
(b) Upon approval by Circus of the Proposed Pre-Opening Plan and
Budget or any portion thereof (which approval shall be deemed to
have been given if no objection is made by Circus within 30 days
after receipt by Circus of the Proposed Pre-Opening Plan and
Budget or any portion thereof) Four Seasons shall carry out the
activities contemplated in the Pre-Opening Plan and Budget or any
portion thereof which has been approved. Four Seasons may, from
time to time, submit revisions to the Pre-Opening Plan and Budget
to Circus for Circus' review and approval (which approval shall be
deemed to have been given if no objection is made by Circus within
15 days after receipt by Circus of the revisions) and any
revisions so approved for all purposes shall constitute part of
the Pre-Opening Plan and Budget. If Circus disapproves of all or
any portion of the Proposed Pre-Opening Plan and Budget or
revisions to the Pre-Opening Plan and Budget within such 30 or 15
day period, as the case may be, Circus shall furnish Four Seasons
at the time of notice of such disapproval with detailed reasons
for its objections to the Proposed Pre-Opening Plan and Budget or
revisions to the Pre-Opening Plan and Budget and Circus and Four
Seasons shall attempt to agree in respect of the items to which
Circus objects within 15 days after notice of disapproval has been
given and if such agreement is not reached within such 15 day
period, then either Circus or Four Seasons shall refer the matter
to arbitration pursuant to the provisions of section 17.03(b).
(c) The Opening Date shall occur on the date determined in accordance
with section 4.01 of the Hotel Management Agreement. If the
Opening Date will be other than the Scheduled Opening Date
contemplated in the Pre-Opening Plan and Budget, Four Seasons
shall submit to Circus for its approval a revision of the
Pre-Opening Plan and Budget which shall reflect any additional
expense or saving, as the case may be, attributable to such
rescheduled Scheduled Opening Date.
(d) In accordance with the Pre-Opening Plan and Budget, Four Seasons,
as agent and for the account of Circus, shall provide, as
appropriate, personnel to, among other things:
(i) recruit, hire, train and direct an initial staff for the
Hotel;
(ii) in consultation with Circus, negotiate leases, licences and
concession agreements for stores and shops constituting part
of the Hotel and office space and lobby space at the Hotel;
provided that prior to entering into any such contract where
(A) the total cost to be incurred, or revenues to be earned,
by the Hotel in respect of such contract is in excess of
$25,000 in any Fiscal Year, or (B) the notice period for
cancellation of such contract by Circus or Owner, as the
case may be, or Four Seasons is in excess of two years, Four
Seasons shall obtain the prior written consent of Circus;
(iii) apply for, process and take all necessary steps to procure
(in Four Seasons' name or, in consultation with Circus, in
Owner's name or in Owner's name and Four Seasons' name, as
may be required by the issuing authority) all licences and
permits required for the operation of the Hotel and its
related facilities, including (without limitation) liquor
and restaurant licences; and
(iv) do all other things necessary for the proper opening of the
Hotel called for by the Pre-Opening Plan and Budget.
ARTICLE V
PROJECT ANALYSIS & SCHEMATIC DESIGN PHASE
5.01 Term
The Project Analysis & Schematic Design Phase (hereinafter
referred to as either the "Project Analysis & Schematic Design Phase" or
"Phase I") shall commence on the date of this Agreement and will end when
Circus has approved the Schematic Design Drawings in consultation with Four
Seasons.
5.02 Circus' Obligations
To the extent that Circus has not completed the following
enumerated tasks prior to the commencement of Phase I, during such Phase,
Circus shall, based upon the Hotel Design Brief:
(a) prepare a preliminary version of the Project Budget, submit same
to Four Seasons for its review and revise and finalize same as and
when required;
(b) interview and select the architect or any successor architect (the
"Project Architect") to prepare the schematic plans for the Hotel
based upon the Hotel Design Brief (the "Schematic Design
Drawings"), negotiate fees to be paid to same and enter into
architectural contracts with same, all in consultation with Four
Seasons;
(c) interview and select contractors, negotiate fees to be paid to
same and enter into construction contracts with same, all in
consultation with Four Seasons, and co-ordinate liaison with the
contractors for assistance with budgeting, cost control and design
alternatives;
(d) interview and select all other Consultants for the design of the
Hotel, negotiate fees to be paid to same and enter into design
contracts with same, all in consultation with Four Seasons;
(e) distribute the Hotel Design Brief to all Consultants involved in
the design of the Hotel, and meet with Four Seasons and such
Consultants to ensure that such Consultants are provided with a
thorough understanding of the requirements and scope of the Hotel;
(f) establish a Hotel organization chart outlining, among other
things, the identity of all Persons (other than individuals which
are not senior management personnel of such Persons) involved in
the development and construction of the Hotel and their
responsibilities;
(g) estimate a design schedule for the timely development of the
design of the Hotel, and meet with Four Seasons and all
Consultants involved in the design of the Hotel to ensure that
same is met;
(h) arrange and implement an accounting system and bank accounts, as
well as invoice processing and payment procedures for the
development and construction of the Hotel;
(i) establish control procedures to effectively monitor and control
all costs throughout the development and construction of the
Hotel;
(j) co-ordinate the development of the Schematic Design Drawings;
(k) co-ordinate input of Four Seasons as required throughout the
course of Phase I;
(l) obtain all necessary Building Permits;
(m) co-ordinate all local public relations activities; and
(n) provide to Four Seasons an estimated schedule for the construction
of the Hotel.
5.03 Four Seasons' Obligations
To the extent that Four Seasons has not completed the following
enumerated tasks prior to the commencement of Phase I, during such Phase, Four
Seasons shall:
(a) prepare, update, revise and review with Circus, as and when
required, the following documents for the development of the
Hotel:
(i) the Hotel Design Brief;
(ii) an operating pro forma and supporting rationale;
(iii) a design standards schedule; and
(iv) an outline of the responsibilities of all specialist
Consultants, such as those involved with the kitchens and
laundry.
(b) review with Circus the proposed method of construction of the
Hotel and the prompt and early involvement of the general
contractor for same;
(c) assist Circus with the preparation of a preliminary version of the
Project Budget and revisions thereto as and when required;
(d) assist Circus in the selection of Consultants, including (without
limitation) assistance in defining the scope of services required
and the negotiation of fees to be paid to such Consultants;
(e) assist Circus with the preparation of a Hotel organization chart
outlining, among other things, the identity of all Persons
involved in the development and construction of the Hotel and
their responsibilities;
(f) meet with Circus and Consultants and review the Hotel Design
Brief, the operating pro forma and supporting rationale, design
standards schedule and the Project Budget, and review with Circus
all of the responsibilities, sources of direction, budget control
and reporting functions of specialist Consultants, such as those
involved with the kitchens and laundry;
(g) attend all meetings as required to assist in the development and
finalization of the Schematic Design Drawings; and
(h) review the proposed form of the Schematic Design Drawings with
Circus, including (without limitation) all drawings,
specifications, budgets and pro formas.
5.04 Four Seasons' Personal Property Obligations
In addition to the obligations required to be performed by Four
Seasons during Phase I as outlined in section 5.03, to the extent that Four
Seasons has not completed the following enumerated tasks prior to the
commencement of Phase I, during such Phase, Four Seasons shall:
(a) prepare a preliminary version of the Personal Property Budget and
schedule of leased items based on the Hotel Design Brief and
operating pro forma and supporting rationale for the Hotel, submit
same to Circus for approval and revise and finalize same as and
when required; and
(b) prepare a preliminary list of the items of Personal Property to be
imported, submit same to Circus so as to enable Circus to obtain
all licences, permits, authorizations and approvals required from
any Governmental Authority to import such items of Personal
Property and revise and finalize same as and when required.
ARTICLE VI
DESIGN DEVELOPMENT & WORKING DRAWINGS PHASE
6.01 Term
The Design Development & Working Drawings Phase (hereinafter
referred to as either the "Design Development & Working Drawings Phase" or
"Phase II") shall commence upon the completion of Phase I and shall end when
Circus has approved the Design Development & Working Drawings and
Specifications in consultation with Four Seasons.
6.02 Circus' Obligations
To the extent that Circus has not completed the following
enumerated tasks prior to the commencement of Phase II, during such Phase,
Circus shall, based upon the Hotel Design Brief:
(a) interview and select such other Consultants and specialist
subcontractors as are required for the Hotel, all in consultation
with Four Seasons;
(b) co-ordinate the development of the Design Development & Working
Drawings and Specifications;
(c) revise the Project Budget;
(d) co-ordinate input of Four Seasons as required throughout the
course of Phase II;
(e) obtain all legal and tax advice necessary to ensure that:
(i) the Hotel records, accounting systems and other systems are
established and maintained in accordance with Applicable Law
and in the most tax efficient manner;
(ii) all licenses, permits, authorizations and approvals required
from any Governmental Authority to import the Personal
Property will be obtained; and
(iii) the Taxes which are payable on the importation of the
Personal Property will be at the lowest possible level;
(f) direct the development of design and legal documentation for all
retail and similar areas to be leased separately from the Hotel,
and co-ordinate all pre-leasing activities in connection
therewith;
(g) arrange all financing for the construction of the Hotel; and
(h) interview and select a customs broker and agent for the
importation of the Personal Property and negotiate fees to be paid
to same.
6.03 Four Seasons' Obligations
To the extent that Four Seasons has not completed the following
enumerated tasks prior to the commencement of Phase II, during such Phase,
Four Seasons shall, based upon the Hotel Design Brief:
(a) at the request of Circus, issue all necessary direction to the
Consultants for the development of the Design Development &
Working Drawings and Specifications;
(b) at the request of Circus, direct all specialist Consultants, such
as those involved with the kitchens and laundry, in the
preparation of their respective design documents;
(c) at the request of Circus, direct the preparation of detailed
layout drawings of all Hotel back of house areas, including
(without limitation) office, maintenance and housekeeping areas;
(d) at the request of Circus, direct the interior designers for the
Hotel and the Project Architect in the preparation of detailed
layouts for all public areas of the Hotel and review alternatives
with Circus;
(e) review and comment on all drawings and specifications submitted by
the various specialist Consultants within the time constraints of
the design program for the Hotel;
(f) review all mechanical and electrical documents and specifications
and provide assistance when required for Consultants to design the
optimal energy management system for the energy efficiency of the
Hotel;
(g) comment to Circus and the general contractor for the Hotel on the
suggested method of construction of the Hotel and the construction
schedule therefor;
(h) provide all necessary technical information for specialist systems
for the Hotel, including (without limitation) computer systems to
be incorporated in the Design Development & Working Drawings and
Specifications;
(i) assist Circus in the co-ordination of all Design Development &
Working Drawings and Specifications to ensure same meet the hotel
design standards and operating criteria of Four Seasons;
(j) attend all meetings as required to assist in the development and
finalization of the Design Development & Working Drawings and
Specifications; and
(k) review the proposed final form of Design Development & Working
Drawings and Specifications with Circus, including (without
limitation) all drawings, specifications, budgets and operating
pro formas.
6.04 Four Seasons' Personal Property Obligations
In addition to the obligations required to be performed by Four
Seasons during Phase II as outlined in section 6.03, to the extent that Four
Seasons has not completed the following enumerated tasks prior to the
commencement of Phase II, during such Phase, Four Seasons shall:
(a) revise the Personal Property Budget and schedule of leased items
as required by any changes in the Hotel Design Brief and the
operating pro forma and supporting rationale for the Hotel, submit
same to Circus for approval and revise and finalize same as and
when required;
(b) at the request of Circus, provide input to the Consultants with
respect to the cost of design alternatives for Personal Property
where appropriate; and
(c) monitor and review the documentation prepared by the Consultants
so as to ensure compliance with the Personal Property Budget.
ARTICLE VII
CONSTRUCTION PHASE
7.01 Term
The Construction Phase (hereinafter referred to as either the
"Construction Phase" or "Phase III") shall commence upon the completion of
Phase II and shall end on the Opening Date.
7.02 Circus' Obligations
To the extent that Circus has not completed the following
enumerated tasks prior to the commencement of Phase III, during such Phase,
Circus shall, based upon the Hotel Design Brief:
(a) provide personnel and systems:
(i) for the complete administration of the contractors and the
other Consultants during the construction period, including
(without limitation) on-site representation; and
(ii) to co-ordinate the payment of all invoices relating to the
purchase of Personal Property;
(b) monitor the contractors to ensure compliance with the construction
program and timetable, timely award of sub-contracts, quality of
workmanship, on-site project organization and monthly payment
obligations;
(c) co-ordinate the distribution of shop drawings, samples and
alternatives to Four Seasons and the Consultants for their
approval;
(d) arrange for the construction of model guestrooms and alter and
adapt such model guestrooms as required and until approved by
Circus and Four Seasons based on the Hotel Design Brief;
(e) obtain a detailed construction schedule and co-ordinate the same
with the timetable for the installation of Personal Property and
the pre-opening hotel operations staff move-in program;
(f) arrange for the preparation of complete and detailed deficiency
lists and provide for timely rectification of all deficiencies;
(g) obtain all Occupancy Permits;
(h) obtain as-built drawings, maintenance manuals, air and water
balance reports and spare stock and provide the same to Four
Seasons;
(i) obtain the insurance coverage:
(i) in accordance with Article XIV; and
(ii) for the Personal Property so as to ensure that the Personal
Property is fully insured at replacement value from the time
it leaves the suppliers' warehouses until it is installed by
the FF&E Co-ordinator in the Hotel;
(j) arrange all financing for the opening of the Hotel, including
(without limitation) permanent financing and operational and
working capital financing in accordance with the Hotel Agreements;
(k) obtain all licenses, permits, authorizations and approvals
required from any Governmental Authority necessary for the
Personal Property;
(l) provide to Four Seasons all of the necessary design documentation
provided to other bidders or used by Circus to enable Four Seasons
to bid on the purchase, delivery and installation of the Personal
Property;
(m) participate in all reviews of, and presentations concerning the,
Personal Property, and submit copies of any written comments to
Four Seasons within seven days of such presentations;
(n) obtain all licenses, permits, authorizations and approvals
required from any Governmental Authority required in order to
import the Personal Property;
(o) obtain all licenses, permits, authorizations and approvals from
any Governmental Authority required to install the Personal
Property;
(p) promptly repair any damage to the Hotel resulting from the
installation of the Personal Property;
(q) co-ordinate the preparation and finalization of all leases of
Personal Property; and
(r) provide all information and documentation to fulfil all of its
obligations under this Agreement, such as Consultants' drawings
and specifications, a schedule for the construction of the Hotel
and a summary of all licences, permits, authorizations and
approvals required from, and Taxes payable to, any Governmental
Authority in connection with the importation of the Personal
Property.
7.03 Four Seasons' Obligations
To the extent that Four Seasons has not completed the following
enumerated tasks prior to the commencement of Phase III, during such Phase,
Four Seasons shall, based upon the Hotel Design Brief:
(a) meet with Circus and the Consultants to assist in the preparation
and finalization of all construction documents for the Hotel;
(b) review all construction documents to ensure same meet the
standards set out in the Hotel Design Brief and the Construction
and Design Standards;
(c) assist in the co-ordination of the construction of model
guestrooms of the Hotel to resolve construction details, quality
and alterations and carry out a final inspection of such models
prior to installation of loose furnishings;
(d) review all shop drawings for the provision of specialist items,
including (without limitation) front desk millwork, and provide a
list of all shop drawings to be reviewed;
(e) review samples of construction materials as required by Circus;
(f) review all shop drawings and fixture cuts for all food and
beverage equipment, laundry equipment and garbage handling
equipment;
(g) recommend and assist Circus in implementing a detailed system of
inspection of all work carried out on the Hotel site;
(h) carry out a final inspection of kitchen and laundry equipment in
conjunction with the appropriate specialist Consultants, such as
those involved with the kitchens and laundry and, if necessary,
prepare a deficiency list;
(i) attend design and construction meetings as required to assist in
the resolution of problems, to expedite construction and to
co-ordinate same with the timetable for the installation of
Personal Property;
(j) recommend to Circus all necessary budgets for working capital
requirements and estimated operating deficits, if any; and
(k) prepare and submit to Circus, on a monthly basis, a complete
report of costs and expenditures for the marketing, operating and
staffing of the Hotel commencing with the first month following
Circus' approval of the Pre-Opening Plan and Budget.
7.04 Four Seasons' Personal Property Obligations
In addition to the obligations required to be performed by Four
Seasons during Phase III as outlined in section 7.03, to the extent that Four
Seasons has not completed the following enumerated tasks prior to the
commencement of Phase III, during such Phase, Four Seasons shall:
(a) participate in the review of model guestrooms of the Hotel,
including (without limitation) preparation of a budget
reconciliation to the Personal Property Budget, analysis of
alternate furnishings where appropriate and determination of
functional requirements;
(b) participate in the review of public areas of the Hotel, including
(without limitation) preparation of a budget reconciliation to the
Personal Property Budget, analysis of alternate furnishings where
appropriate and determination of functional requirements;
(c) review bids from the general contractor for all kitchen, bar,
telephone, laundry, computer and garbage equipment, and all
specialty systems required for the Hotel so as to ensure
compliance with the Personal Property Budget and make
recommendations to Consultants regarding specifications and
valuation engineering;
(d) co-ordinate the preparation of the design of, or the selection of,
uniforms, menus, collateral, table top settings and artwork; and
(e) prepare procedures for the hand-over to operations.
ARTICLE VIII
POST-OPENING DEFICIENCIES PHASE
8.01 Post-Opening Deficiency Phase
The Post-Opening Deficiencies Phase (hereinafter referred to as
either the "Post-Opening Deficiencies Phase" or "Phase IV") shall commence on
the Opening Date and shall end on the date provided for in section 10.01.
8.02 Circus' Obligations
To the extent that Circus has not completed the following
enumerated tasks prior to the commencement of Phase IV, during such Phase,
Circus shall, based upon the Hotel Design Brief:
(a) arrange for the rectification of all deficiencies in an
expeditious manner to suit the exigencies of the operation of the
Hotel in the manner described in section 10.01;
(b) finalize all necessary legal documentation and all other financial
and tax matters in respect of the Hotel;
(c) finalize all accounts and prepare a detailed final report and
analysis in respect of the construction of the Hotel; and
(d) based upon the purchase orders issued and invoices received,
finalize the Personal Property accounts.
8.03 Four Seasons' Obligations
To the extent that Four Seasons has not completed the following
enumerated tasks prior to the commencement of Phase IV, during such Phase,
Four Seasons shall, based upon the Hotel Design Brief:
(a) assist Circus in directing the Consultants in their preparation of
final deficiency lists;
(b) assist Circus in identifying and directing the rectification of
all deficiencies; and
(c) carry out a final inspection of the Hotel on completion of the
rectification of all deficiencies.
ARTICLE IX
DESIGNATED MANAGERS AND CO-ORDINATORS
9.01 Circus' Responsibilities
As soon as is practicable, but in any case no later than three
months following completion of Phase I, Circus shall assign one or more
individuals who will be identified to Four Seasons to act as Circus' project
manager until completion of the Phase IV (collectively, the "Circus' Project
Manager").
9.02 Four Seasons' Responsibilities
As soon as practicable, but in any case within the time periods
designated below:
(a) Four Seasons shall assign one or more individuals who will be
identified to Circus no later than three months following
completion of Phase I, to act as Four Seasons' project design and
construction manager (collectively, the "Four Seasons' Project
Manager"); and
(b) in the event Circus, in its sole discretion, engages Four Seasons
to provide services relating to the purchase and installation of
the Personal Property for the Hotel, Four Seasons shall assign one
or more individuals who will be identified to Circus no later than
nine months prior to the Scheduled Opening Date or, if Four
Seasons is engaged by Circus after such time, as soon as
practicable after such engagement, to act as the Personal Property
installation co-ordinator (the "FF&E Co-ordinator") during at
least the last six months of Phase III and during Phase IV.
9.03 General Co-ordination
Each of the individuals appointed as the Circus' Project Manager,
the Four Seasons' Project Manager and the FF&E Co-ordinator shall fully co-
ordinate his or her respective authority and responsibilities with the other
individuals so appointed. It is understood that each party is vitally
interested in the qualifications and performance of the individuals appointed
by the other party in the capacity of the Circus' Project Manager, the Four
Seasons' Project Manager and the FF&E Co-ordinator. Accordingly, each party
will consult with and obtain the approval of the other party prior to
appointing any such individual and if, after any such appointment, the other
party becomes dissatisfied with the performance of any such individual, the
other party shall have the right to confer with the appointing party in an
attempt to resolve any problems, including (without limitation) consideration
of replacing such individual. It is understood, however, that any final
decisions in this area will be made by the appointing party after due
consideration of the views expressed by the other party in such consultations.
ARTICLE X
DEFICIENCIES
10.01 Deficiencies
30 days before the Scheduled Opening Date, Circus shall prepare
and deliver to Four Seasons a listing of all deficiencies and construction
work remaining uncorrected or incomplete (including, without limitation,
"punchlist" items). Four Seasons shall have the right to add additional items
to such list (whether or not made before or after the Opening Date). Circus
shall co-operate with Four Seasons to ensure that all such matters are
completed within three months following the Opening Date (if Circus is
notified late of any specific item not included in such listing at the Opening
Date, three months following such later date); provided that if such matters
cannot be completed within such three month period, Circus shall commence such
actions within such period and thereafter diligently prosecute such work to
completion. If Circus fails to complete such work in a timely fashion, Four
Seasons shall be entitled to undertake such work at the cost of Circus and
Four Seasons shall pay such costs out of the Hotel Bank Accounts. If there
are insufficient funds in the Hotel Bank Accounts and Four Seasons
nevertheless undertakes such work, Four Seasons shall be entitled to be repaid
on demand by Circus for the cost of such work, together with interest on such
cost from the date of incurring such cost at the Interest Rate.
ARTICLE XI
REMUNERATION AND REIMBURSEMENT OF FOUR SEASONS
11.01 Consulting Fee
Circus shall pay to Four Seasons a consulting fee (the "Consulting
Fee") for its pre-opening services (including operational services) of
$500,000. The Consulting Fee shall be payable in 14 equal monthly instalments
of $35,714.29 each, on the first day of each month commencing in January of
1998; provided that if the Consulting Fee has not been paid in full on or
prior to the Opening Date, the balance of the Consulting Fee shall become due
and payable on the Opening Date.
11.02 Personal Property Services Fee
Circus shall pay to Four Seasons a personal property services fee
(the "Personal Property Services Fee") of $200,000. The Personal Property
Services Fee shall be payable in 14 equal monthly instalments of $14,285.71
each, on the first day of each month, commencing in January of 1998; provided
that if the Personal Property Services Fee has not been paid in full on or
prior to the Opening Date, the balance of the Personal Property Services Fee
shall become due and payable on the Opening Date.
In the event that the scope of the pre-opening purchasing services or
responsibilities of Four Seasons hereunder are expanded, the Personal Property
Services Fee payable to Four Seasons shall be fairly and equitably increased
for all additional or expanded services performed by Four Seasons as a result
thereof.
11.03 Reimbursement of Costs
Circus shall reimburse Four Seasons for all reasonable costs and
expenses incurred by Four Seasons in the performance of the services
contemplated by this Agreement. Such costs and expenses may include, but are
not limited to, consultants fees and expenses, out-of-pocket expenses incurred
in connection with the performance of the duties described in this Agreement,
travel expenses and food and lodging of senior officers and other home office
personnel of Four Seasons (but shall not include the employment costs of such
officers or personnel). Such costs and expenses shall be set out by Four
Seasons in a reimburseables budget to be approved by Circus and shall not
exceed the amounts budgeted thereof in such reimburseables budget.
Four Seasons shall submit to Circus monthly statements setting
forth all costs and expenses reimbursable to Four Seasons pursuant to this
section 11.03 during the preceding month, and such reimbursable costs and
expenses will be paid by Circus to Four Seasons within 15 days after receipt
of a statement by Circus.
11.04 Fund for Pre-Opening Costs and Expenses
Circus shall advance to Four Seasons amounts equal to the costs
and expenses provided for in the Pre-Opening Plan and Budget, including
(without limitation) the costs and expenses contemplated by section 11.03, at
the times contemplated for the expenditure thereof in the Pre-Opening Plan and
Budget.
11.05 Interest
Any amount not paid by Circus when due shall accrue interest on
such amount from the date such amount became due at the Interest Rate.
ARTICLE XII
DAMAGE TO AND DESTRUCTION OF THE HOTEL
12.01 Four Seasons' Entitlement to Fees and Charges
During a Delay Resulting From Damage or Destruction
Four Seasons shall, notwithstanding any delay or interruption
resulting from any damage or destruction to the Hotel, be entitled to receive,
from any insurance proceeds paid in respect of the business interruption
insurance maintained in accordance with Article XIV, the Consulting Fee and
the Personal Property Services Fee at the time and in the manner specified in
this Agreement.
ARTICLE XIII
EXPROPRIATION
13.01 Four Seasons' Entitlement to Fees and
Charges During a Temporary Expropriation
If all or any part of the Hotel shall be taken or condemned in any
expropriation, compulsory acquisition or like proceedings for a temporary use,
Four Seasons shall be entitled to receive, from any insurance proceeds paid in
respect of the business interruption insurance maintained in accordance with
Article XIV, the Consulting Fee and the Personal Property Services Fee at the
time and in the manner specified in this Agreement.
ARTICLE XIV
INSURANCE
14.01 Coverage
Circus shall provide and maintain for the Hotel, at all times
during the construction period of the Hotel and up to and including the end of
Phase IV, as an expense of the Hotel, policies of insurance to be proposed by
Circus in consultation with Four Seasons.
ARTICLE XV
ASSIGNMENTS AND MORTGAGES
15.01 Circus' Right to Assign
Subject to the provisions of section 15.03, Circus shall have the
right at any time to sell, assign, transfer or otherwise dispose of all or any
part of its Interest to any Person on the condition that such Person first
enter into an agreement with Four Seasons, in form and substance satisfactory
to Four Seasons, agreeing:
(a) that the Hotel Agreements continue in full force in effect after
such sale, assignment, transfer or other disposition; and
(b) to assume all of the contractual obligations of Circus contained
in the Hotel Agreements.
15.02 Circus' Right to Mortgage
Subject to the provisions of section 15.03, Circus shall have the
right at any time to mortgage, hypothecate or otherwise encumber all or any
part of its Interest to any Person on the condition that such mortgagee first
enter into an agreement with Four Seasons, in form and substance satisfactory
to Four Seasons, agreeing:
(a) to be bound by Circus' covenants and undertakings hereunder for
any period during which it is in possession of the Hotel;
(b) that in the event of a foreclosure of its mortgage or lien on the
Hotel or this Agreement or of a conveyance in lieu of foreclosure
(i) no default under such mortgage or other documents evidencing
the lien in favour of such mortgagee, and no proceeding to
foreclose the same, and no conveyance in lieu of foreclosure
thereof, will affect any other right of Four Seasons under this
Agreement, and (ii) this Agreement shall continue in full force
and effect and such mortgagee, its successors and assigns, or any
party (the "Foreclosure Purchaser") acquiring the Hotel or any
interest or right therein upon foreclosure sale or by deed in lieu
of foreclosure, as the case may be, shall be a Qualified Person
and shall automatically recognize this Agreement and Four Seasons'
rights hereunder for the balance of the term of this Agreement
upon the same terms, covenants and conditions as herein provided,
with the same force and effect as though this Agreement were
originally made directly between Four Seasons and such mortgagee,
or its successors and assigns, or the Foreclosure Purchaser, as
the case may be; and
(c) not to sell, transfer or otherwise dispose of any interest it may
have in the Hotel or this Agreement without first causing any
transferee thereof to acknowledge and agree to be bound by and
become a party to such agreements with Four Seasons.
15.03 Limitation on Circus' Right to Assign and Mortgage
Notwithstanding the provisions of sections 15.01 and 15.02, Circus
shall not without the express prior written consent of Four Seasons, which
consent may be unreasonably withheld or delayed, directly or indirectly, by
way of transfer of shares, partnership interests or otherwise, sell, assign,
transfer or otherwise dispose of, or mortgage, hypothecate or otherwise
encumber, any interest, whether legal or beneficial, in all or any part of its
Interest to any Person other than a Qualified Person. Any change in control
of Circus, whether directly or indirectly and whether by way of transfer of
shares, partnership interests or otherwise, to any Person other than a
Qualified Person shall be prohibited unless the express prior written consent
of Four Seasons, which consent may be unreasonably withheld or delayed, is
obtained; provided that this section 15.03 shall not apply to a change in
control of Circus Circus Enterprises, Inc. resulting from the change in
ownership of, or direction or control over, shares of Circus Circus
Enterprises, Inc. that are listed and posted for trading on any
internationally recognized securities exchange.
15.04 Four Seasons' Right to Assign
Subject to the provisions of section 15.06, Four Seasons shall
have the right at any time to sell, assign, transfer or otherwise dispose of
all or any part of its Interest to any Person on the condition that:
(a) the Person to whom the Interest of Four Seasons is to be sold,
assigned, transferred or otherwise disposed of shall first enter
into an agreement with Circus, in form and substance satisfactory
to Circus, agreeing to assume all of the contractual obligations
of Four Seasons contained in this Agreement; and
(b) in the case of a sale, assignment, transfer or other disposition
to an Affiliate of Four Seasons, Four Seasons shall first enter
into an agreement with Circus, in form and substance satisfactory
to Circus, agreeing to be jointly and severally liable with such
Affiliate to perform all of the contractual obligations of Four
Seasons contained in this Agreement notwithstanding such sale,
assignment, transfer or other disposition.
Upon a sale, assignment, transfer or other disposition to a Person other than
an Affiliate, Four Seasons shall be released from all of its obligations under
this Agreement.
15.05 Four Seasons' Right to Mortgage
Four Seasons shall have the right at any time to mortgage,
hypothecate or otherwise encumber all or any part of its right to any payment
to which it is entitled hereunder to a financial institution as security for
its obligations to such financial institution.
15.06 Limitation on Four Seasons' Right to Assign
Four Seasons shall not without the express prior written consent
of Circus, which consent may be unreasonably withheld or delayed, directly or
indirectly, by way of transfer of shares, partnership interests or otherwise,
sell, assign, transfer or otherwise dispose of all or any part of its Interest
to any Person other than (i) an Affiliate, (ii) a Person that results from any
merger, amalgamation, consolidation or other reorganization of Four Seasons or
(iii) a Person that acquires all or substantially all the assets of Four
Seasons, and operates a luxury hotel management business after any such sale,
assignment, transfer or other disposition either on its own or in conjunction
with its Affiliates under the name "Four Seasons". This section 15.06 shall
not, however, apply to a change in control of Four Seasons Hotels Inc.
resulting from the change in ownership of, or direction or control over,
shares of Four Seasons Hotels Inc. that are listed and posted for trading on
any internationally recognized securities exchange.
ARTICLE XVI
EVENTS OF DEFAULT AND TERMINATION
16.01 General
Each of the following events shall constitute an event of default
by the party in respect of which such event occurs:
(a) the failure of either Circus or Four Seasons to pay any amounts
required to be paid by it hereunder to the other party for a
period of 30 days after the date on which notice of the failure
has been given to the defaulting party by the other party;
(b) the filing of a voluntary assignment in bankruptcy or insolvency
or a petition for reorganization under any Applicable Law by
Circus or Four Seasons;
(c) the consent to an involuntary petition in bankruptcy or the
failure by Circus or Four Seasons to vacate, within 60 days from
the date of entry thereof, any order approving an involuntary
petition;
(d) the making of an order, judgment or decree by any court of
competent jurisdiction, on the application of a creditor,
adjudicating Circus or Four Seasons a bankrupt or insolvent or
approving a petition seeking reorganization or appointing a
receiver, trustee or liquidator of all or a substantial part of a
party's assets, if such order, judgment or decree shall continue
unstayed and in effect for a period of 120 consecutive days; or
(e) the failure of either Circus or Four Seasons to fulfil any of the
other material covenants, undertakings, obligations or conditions
set forth in this Agreement, and the continuance of any such
default for a period of 30 days after written notice of the
failure; provided that if upon receipt of any notice the
defaulting party promptly and with all due diligence cures the
default or, if the default is not susceptible of being cured
within the 30 day period and the defaulting party advises the
other party in writing of the period which will be required to
cure the default and with all due diligence takes and continues
action to cure and cures the failure within that period so
advised, then no event of default shall be deemed to have occurred
unless and until the defaulting party has failed to take or to
continue to take action or to complete the cure within the period.
Any Dispute as to whether a period required to cure a default is a
reasonable period shall, if requested by either Circus or Four
Seasons, be resolved by arbitration in accordance with the
provisions of section 17.03(b).
16.02 Rights of Non-Defaulting Party
Upon the occurrence of any event of default pursuant to section
16.01 and the applicable grace periods having expired, either Circus or Four
Seasons may, without prejudice to any other recourse at law or in equity which
it may have, give to the other notice of its intention to terminate this
Agreement after the expiration of a period of 30 days from the date of such
notice and, upon the expiration of such period, the term of this Agreement
shall expire unless such default has been cured within such 30 day period.
16.03 Remedying Defaults
Notwithstanding anything to the contrary contained in this
Agreement, either Circus or Four Seasons shall be entitled to remedy any
default of the other under this Agreement with reasonable notice to the other
or without notice in the event of any emergency or apprehended emergency,
without prejudice to any rights under this Agreement and the party so
remedying such default shall be repaid upon demand by the other for the cost
of remedying such default, together with interest on such cost from the date
of incurring such cost at the Interest Rate.
16.04 Bona Fide Dispute
Notwithstanding the provisions of section 16.02, neither Circus
nor Four Seasons shall be entitled to take any of the actions contemplated in
section 16.02, save and except for the commencement of any legal proceedings
(in which case the provisions of sections 20.08 and 20.09 regarding
jurisdiction and service of process shall govern) seeking such mandatory,
declaratory or injunctive relief as may be necessary to define or protect the
rights and enforce the obligations contained in this Agreement pending the
resolution of a Dispute, if before the expiration of the 30 day notice period
referred to in section 16.02, notice of a Dispute has been delivered in
accordance with section 17.02(a) with respect to any of the foregoing events
of default and the procedures set forth in section 17.02(b) and (c) are being
pursued in good faith (except that for this purpose under section 17.02(b),
the requirement of a 30 day negotiation period under section 17.02(a) shall be
inapplicable and the period within which to appoint an expert under
section 17.02(b) shall commence on the date of delivery of notice of a
Dispute); provided that neither Circus nor Four Seasons shall commence any
such legal proceedings seeking to enjoin the development and construction of
the Hotel.
16.05 Four Seasons' Right to Terminate
In addition to any right arising out of section 16.02, Four
Seasons shall have the right to terminate this Agreement if the site
preparation for the Hotel has not commenced by January 1, 1998, or if the
Opening Date does not occur on or before December 31, 2000, other than by
reason of any default by Four Seasons in its obligations under this Agreement
or the other Hotel Agreements or due to the occurrence of any one or more
Force Majeure Events. Four Seasons' right to terminate this Agreement in
accordance with this section 16.05 shall be exercised by written notice by
Four Seasons given to Circus within 30 days after the relevant date mentioned
above. If the Opening Date does not occur on or before December 31, 2000 for
any reason beyond the control of Circus, including (without limitation) the
Hotel or any portion thereof being damaged or destroyed, and Four Seasons does
not terminate this Agreement in accordance with this section 16.05, Four
Seasons shall nevertheless be entitled to receive, from any insurance proceeds
paid in respect of the business interruption contemplated in Article XIV the
Consulting Fee and the Personal Property Services Fee, for the period
beginning on January 1, 2001 and ending on the Opening Date. Any Dispute as
to whether or not Four Seasons has the right to terminate this Agreement in
accordance with this section 16.05 shall, if requested by either Owner or Four
Seasons, be resolved by arbitration in accordance with the provisions of
section 17.03(b).
16.06 Cross-Termination
If any or all of the other Hotel Agreements are terminated after
the Opening Date, then this Agreement shall automatically terminate as of the
date of termination of such other Hotel Agreements and Circus and Four Seasons
shall have no further obligations arising out of this Agreement, save and
except as expressly otherwise provided for in this Agreement.
16.07 Accounting on Termination
If this Agreement is terminated, Four Seasons shall be entitled
(in addition to any rights or remedies available to it at law or in equity) to
all sums, charges and fees which it is entitled to receive under this
Agreement payable up to and including the date of termination, together with
costs and expenses, if any, reimbursable to it pursuant to section 11.03 or
for which it may be responsible arising out of anything done within the scope
of its responsibilities under this Agreement, to the date of termination. The
amount of all of such sums, charges, fees and out-of-pocket costs and expenses
shall be ascertained for the period ending on the date of such termination and
shall be paid to Four Seasons on the later of the date on which such sums,
charges, fees and expenses are ascertained and the date which is 20 days after
the date of such termination.
16.08 Claims on Termination
Notwithstanding anything contained in this Agreement, (i) the
termination of this Agreement shall not prejudice any cause of action, claim
or right of any of Circus or Four Seasons against the other accrued or to
accrue on account of any default by the other of its obligations under this
Agreement or arising as a result of the termination of this Agreement, and any
term, covenant, condition or provision of this Agreement referable thereto
shall not merge, but shall survive, the termination of this Agreement, and
(ii) the Dispute resolution procedure set forth in section 17.02 shall no
longer apply to any of Circus or Four Seasons after termination of this
Agreement and any of Circus or Four Seasons shall be entitled to commence
legal proceedings seeking any recourse available to it at law or in equity,
including (without limitation) mandatory, declaratory or injunctive relief to
define or protect the rights and enforce the obligations contained in this
Agreement; provided that such legal proceedings shall not involve issues which
have previously been submitted to and settled by arbitration in accordance
with this Agreement unless such legal proceedings involve the enforcement of
an arbitration decision or award made in respect of such issues.
ARTICLE XVII
APPROVALS, DISPUTE RESOLUTION AND ARBITRATION
17.01 Approvals
Except as otherwise expressly provided in this Agreement:
(a) all opinions contemplated by this Agreement must be reasonably
formed and the approval of any document, proposed action or other
matters in accordance with this Agreement shall not be
unreasonably withheld or delayed; provided, however, that in
determining the reasonableness of any such withholding or delay,
full consideration shall be given to the effect of such denial or
refusal on the ability of Operator to operate and manage the Hotel
as a World Class Luxury Hotel; and
(b) the following procedure shall be followed with respect to any
matter requiring approval:
(i) such documents or a written description of the proposed
action or other matter requiring approval shall be submitted
by the party having responsibility therefor (the "requesting
party") to the party having the right of approval, which
submission shall be accompanied by a request for approval in
accordance with this Agreement;
(ii) as soon as possible but not later than 30 days after receipt
of any proposed budget or 10 days after the receipt of any
other written request for approval (or such longer time
period as may be specified for approval with respect to any
item in this Agreement) the party having the right of
approval shall notify in writing the requesting party of its
approval or of its specific objections to the document,
proposed action or other matter;
(iii) failure to respond in writing with specific objections
within the maximum time period specified in section
17.01(b)(ii) shall constitute approval of all matters
submitted;
(iv) within 10 days of the receipt of any objections (or such
other time period as may be specified in this Agreement),
the requesting party shall:
(A) acquiesce to such objections; or
(B) reach an agreement with the party objecting; or
(C) call for a meeting of representatives of Circus and
Four Seasons to be convened to consider the matter in
dispute (by giving notice to convene such meeting in
writing indicating the specific issues in dispute to
be resolved by such representatives); and
(v) as soon as possible, but not later than 10 days after
receiving a request to convene a meeting in accordance with
section 17.01(b)(iv)(C), representatives of Circus and Four
Seasons shall convene to consider the specific issues in
dispute and resolve them to the mutual satisfaction of the
parties and if unable to resolve the specific issues in
dispute, the same shall be resolved in accordance with the
arbitration procedure provided in section 17.03.
Once any document, proposed action or other matter is approved, no change or
amendment thereof may be effected without the prior consent of both parties.
17.02 Dispute Resolution
Unless otherwise specifically provided for in this Agreement, all
disputes, controversies, claims or disagreements arising out of or relating to
this Agreement (singularly, a "Dispute", and collectively, "Disputes") shall
be resolved in the following manner:
(a) first, within 10 days from the receipt of notice of a Dispute by
one party to the other, the parties shall in good faith attempt to
negotiate for a period of 30 days in an effort to resolve the
Dispute;
(b) second, if the parties are unable to resolve the Dispute within
such 30 day period, they shall retain a mutually acceptable expert
to assist them in resolving the Dispute within 10 additional days,
failing which they shall each retain an expert on the eleventh day
and the two experts thus chosen shall together act as the expert
for the purposes of this section 17.02(b). If either party shall
fail to appoint an expert as required hereunder, the expert
appointed by the other party shall be the sole expert. Within 60
days after the experts (or such single expert) have been retained,
the experts (or such single expert) shall, on a non-binding basis,
advise the parties in writing of their views. The fees and
expenses of the experts (or such single expert) shall be borne
equally;
(c) third, if the parties are still unable to resolve the Dispute
within such 60 day period, the parties shall resort to the
arbitration procedures set forth in section 17.03; and
(d) fourth, any party to the Dispute shall be entitled to join any
Dispute proceeding arising out of this Agreement with any other
Dispute proceeding arising out of either this Agreement or the
other Hotel Agreements.
17.03 Legal Proceedings and Arbitration
(a) Except as otherwise expressly provided in this Agreement, any
Dispute arising out of or relating to this Agreement shall not be
resolved by arbitration, but may be resolved by legal proceedings.
(b) Where it is otherwise expressly provided in this Agreement that a
Dispute arising out of or relating to this Agreement shall be
resolved by arbitration, the arbitration shall be conducted as
follows:
(i) each party shall be entitled to serve upon the other
party written notice of its desire to settle the
matter by arbitration, which notice shall specify the
name of the individual such party wishes to appoint as
the sole arbitrator of the matter, which individual
shall be experienced in the hotel gaming industries.
Within 10 days after receipt by the other party of
such notice, such other party shall notify the first
party of its approval or its disapproval of the
proposed arbitrator. If no such notice is given by
the other party within such 10 day period, such other
party shall be deemed to have approved of the proposed
arbitrator. If such other party disapproves of the
proposed arbitrator, either party may apply to the
courts of the State of Nevada located in Las Vegas,
Nevada for the appointment of a single arbitrator who
shall be experienced in the hotel and gaming
industries;
(ii) the decision of the arbitrator shall be made within 30
days of the close of the hearing in respect of the
arbitration (or such longer time as may be agreed to,
if necessary, which agreement shall not be
unreasonably withheld) and the decision of the
arbitrator, when reduced to writing and signed by the
arbitrator shall be final, conclusive and binding upon
the parties hereto, and may be enforced in any court
having jurisdiction;
(iii) the arbitration shall be held in Las Vegas, Nevada
and, except for those procedures specifically set
forth in this section 17.03, shall be conducted in
accordance with the Commercial Arbitration Rules of
the American Arbitration Association as in effect on
the date hereof; and
(iv) the arbitrator shall determine the proportion of the
expenses of such arbitration which each party shall
bear; provided, however, that each party shall be
responsible for its own legal fees.
Notwithstanding anything contained in this section 17.03(b), any of Circus or
Four Seasons shall be entitled to (i) commence legal proceedings (in which
case the provisions of sections 20.08 and 20.09 governing jurisdiction and
service of process shall govern) seeking such mandatory, declaratory or
injunctive relief as may be necessary to define or protect the rights and
enforce the obligations contained herein pending the settlement of a Dispute
in accordance with the arbitration procedures set forth in this section 17.03,
(ii) commence legal proceedings (in which case the provisions of sections
20.08 and 20.09 governing jurisdiction and service of process shall govern)
involving the enforcement of an arbitration decision or award or judgment
arising out of this Agreement, or (iii) join any arbitration or legal
proceeding arising out of this Agreement with any other arbitration or legal
proceeding arising out of either this Agreement or the other Hotel Agreements;
provided that neither Circus nor Four Seasons shall commence any such legal
proceedings seeking to enjoin the development and construction of the Hotel.
ARTICLE XVIII
FOUR SEASONS' LIABILITY
18.01 Standard of Care
Four Seasons shall not, in the performance of its obligations
under this Agreement, be liable to Circus or to any other Person for any act
or omission (whether negligent, tortious or otherwise) of Four Seasons or any
of its Affiliates or any of their respective directors, officers, employees,
consultants, agents or representatives, except only to the extent such
liabilities, obligations, claims, costs and expenses arise out of or are
caused by the wilful misconduct, gross negligence or bad faith of Four Seasons
or any of its Affiliates or any of their respective directors, officers,
employees, consultants, agents or representatives.
18.02 Indemnities
(a) Circus hereby indemnifies and holds Four Seasons and its
Affiliates and any of their respective directors, officers,
employees, consultants, agents and representatives (collectively,
the "Indemnified Parties") harmless from and against any and all
liabilities, fines, suits, claims, obligations, damages,
penalties, demands, actions, costs and expenses of any kind or
nature (including, without limitation, legal fees) arising out of
any action or omission or course of action on the part of an
Indemnified Party in the performance of its obligations under this
Agreement; provided that this indemnity shall not apply to any
liabilities, fines, suits, claims, obligations, damages,
penalties, demands, actions, costs and expenses resulting from the
willful misconduct, gross negligence or bad faith of the
Indemnified Party.
(b) Four Seasons hereby indemnifies and holds Circus and any of its
directors, officers, employees, consultants, agents and
representatives harmless from and against any and all liabilities,
fines, suits, claims, obligations, damages, penalties, demands,
actions, costs and expenses of any kind or nature (including,
without limitation, legal fees) arising out of or caused by the
wilful misconduct, gross negligence or bad faith of Four Seasons
or any of its directors, officers, employees, consultants, agents
or representatives.
ARTICLE XIX
ACKNOWLEDGMENTS
19.01 Circus' Acknowledgments
Circus acknowledges that:
(a) in entering into this Agreement and except as provided in section
19.02, Circus has not relied on any statement, study,
representation or warranty of Four Seasons, any of its Affiliates
or any Person actually or apparently engaged by them or on their
behalf, express or implied, relating to the Hotel, including
(without limitation) any statement, study, representation or
warranty relating to the structural integrity, safety or other
similar aspects of the Hotel, the competence of the Consultants,
the compliance of the Hotel with Applicable Law, any projection or
pro forma statements of earnings or profit or loss or statements
as to future success of the Hotel which may have been prepared by
or on behalf of Four Seasons, any of its Affiliates or any Person
actually or apparently engaged by them or on their behalf, and
Circus understands that no guarantee is made or implied by Four
Seasons or any of its Affiliates with respect thereto; and
(b) Four Seasons is relying on the representations, warranties and
covenants of Circus set out in the Hotel Agreements in connection
with Four Seasons entering into and fulfilling its obligations
under this Agreement.
19.02 Four Seasons' Acknowledgments
Four Seasons acknowledges that Circus is relying on the
representations, warranties and covenants of Four Seasons set out in this
Agreement, and of the Affiliates of Four Seasons set out in the other Hotel
Agreements, in connection with Circus entering into and fulfilling its
obligations under this Agreement.
ARTICLE XX
GENERAL PROVISIONS
20.01 Entire Agreement
This Agreement and the other Hotel Agreements, together with all
schedules attached hereto and thereto, constitute the entire agreement between
the parties with respect to the subject matter contemplated herein and therein
and supersedes all oral statements and prior writings with respect to the
subject matter contemplated herein and therein. Any other agreements
regarding the subject matter contemplated herein and therein, whether written
or oral, are terminated.
20.02 Modification and Changes
This Agreement cannot be changed or modified except by another
agreement in writing signed by all the parties or by their respective duly
authorized agents and consented to by all the parties to the other Hotel
Agreements.
20.03 Partial Invalidity
In the event that any one or more of the phrases, sentences,
clauses, Articles or sections contained in this Agreement shall be declared
invalid or unenforceable by order, decree or judgment of any court having
jurisdiction, or shall be or become invalid or unenforceable by virtue of any
Applicable Law, the remainder of this Agreement shall be construed as if such
phrases, sentences, clauses, Articles or sections had not been inserted except
when such construction (a) would operate as an undue hardship on either party
or (b) would constitute a substantial deviation from the general intent and
purposes of the parties as reflected in this Agreement. In the event of
either (a) or (b) above, the parties shall use their best efforts to negotiate
a mutually satisfactory amendment to this Agreement to circumvent such adverse
construction. If no such amendment has been agreed upon within 60 days after
the initial request by either party to negotiate such amendment, such Dispute
shall be submitted to arbitration in accordance with the provisions of section
17.03.
20.04 Counterparts
This Agreement may be executed simultaneously in two counterparts,
each of which counterparts shall be deemed an original. In proving this
Agreement it shall not be necessary to produce or account for more than one of
the counterparts.
20.05 Waivers
No failure by a party to insist upon the strict performances of
any provision of this Agreement, or to exercise any right or remedy consequent
upon the breach thereof, shall constitute a waiver of any such breach or any
subsequent breach of such provision. No provision of this Agreement and no
breach thereof shall be waived, altered or modified except by written
instrument. No waiver of any breach shall affect or alter this Agreement, but
each and every provision of this Agreement shall continue in full force and
effect with respect to any other then existing or subsequent breach thereof.
20.06 Enurement
This Agreement shall enure to the benefit of and be binding upon
each of the parties and their respective successors and permitted assigns.
20.07 Applicable Law
This Agreement shall be construed, interpreted and applied in
accordance with, and shall be governed by, the laws of the State of Nevada and
the federal laws of the United States of America applicable therein.
20.08 Jurisdiction
The parties irrevocably:
(a) submit and consent to the non-exclusive jurisdiction of the courts
of the State of Nevada located in Las Vegas, Nevada as regards any
suit, action or other legal proceedings arising out of this
Agreement;
(b) waive, and agree not to assert, by way of motion, as a defense or
otherwise, in any such suit, action or proceedings, any claim that
they are not personally subject to the jurisdiction of the courts
of the State of Nevada located in Las Vegas, Nevada, that the
suit, action or proceeding is brought in an inconvenient forum,
that the venue of the suit, action or proceeding is improper, or
that this Agreement or the subject matter hereof may not be
enforced in such courts; and
(c) agree not to seek, and hereby waive any review by any court which
may be called upon to enforce the judgment of the courts referred
to in section 20.08(a), of the merits of any such suit, action or
proceeding in the event of failure of any party to defend or
appear in any such suit, action or proceeding.
20.09 Designation of Agent for Service of Process
(a) Four Seasons irrevocably designates the General Manager at the
Hotel as its Nevada agent to accept and acknowledge on its behalf
service of any and all process in any such suit, action or
proceeding brought in the State of Nevada, and Four Seasons agrees
and consents that any such service of process as specified above
shall be taken and be deemed to be valid personal service upon
Four Seasons and that any such service of process shall be of the
same force and validity as if service were made upon it according
to the laws governing the validity and requirements of such
service in the State of Nevada, and Four Seasons waives all claims
of error by reason of any such service. Notwithstanding the
foregoing, Four Seasons may, by notice to Circus, change its
designation of any agent for service of process. Without in any
way limiting the validity of such service of process, Circus shall
promptly mail a copy of such process to Four Seasons at its
address set forth in section 20.10.
(b) Circus irrevocably designates its General Counsel at ▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇.▇.▇. ▇▇▇▇▇ as its
Nevada agent to accept and acknowledge on its behalf service of
any and all process in any such suit, action or proceedings
brought in the State of Nevada, and Circus agrees and consents
that any such service of process as specified above shall be taken
and deemed to be valid personal service upon Circus and that any
such service of process shall be of the same force and validity as
if service were made upon them according to the laws governing the
validity and requirement of such service in the State of Nevada,
and the Circus waives all claims of error by reason of any such
service. Notwithstanding the foregoing, Circus may, by notice to
Four Seasons change its designation of any agent for service of
process. Without in any way limiting the validity of such service
of process, Four Seasons shall promptly mail a copy of such
process to Circus at its address set forth in section 20.10.
20.10 Notices
Except as may otherwise be provided in this Agreement, all
notices, demands, statements, requests, consents, approvals and other
communications (collectively, "Notices") required or permitted to be given
hereunder, or which are to be given with respect to this Agreement, shall be
in writing, duly executed by an authorized officer or agent of the party so
giving such Notice, and either personally delivered to any duly authorized
representative of the party receiving such Notice or sent by facsimile
transmission, registered or certified mail, or by courier service, return
receipt requested, addressed:
If to Four Seasons, to: Four Seasons Hotels Limited
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn: General Counsel
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Circus, to: Circus Circus Enterprises, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Attn: General Counsel
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: Circus Circus Enterprises, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Attn: President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
All Notices shall be effective for all purposes upon personal delivery thereof
or, if sent by facsimile transmission, shall be effective on the date of
transmission duly shown on the confirmation slip, or, if sent by mail or air
freight or courier service, shall be effective on the date of delivery duly
shown on the return receipt. Any party may at any time change the addresses
for Notices to such party by giving a Notice in the manner set forth in this
section 20.10.
20.11 Time of Essence
Time shall be of the essence of each and every term and obligation
of this Agreement.
20.12 Estoppel Certificates
Each party shall, upon at least 10 days' written notice, execute
and deliver to any other party, and to any other Person having or about to
have a bona fide interest in the Hotel as such other party may designate in
writing, a statement certifying that this Agreement is unmodified and in full
force and effect, or if not, stating the details of any modification and
stating that as modified it is in full force and effect, the date to which
payments have been paid and whether or not, to the knowledge of the certifying
party, there is any existing default on the part of any other party.
20.13 Personal Property Purchasing Services
(a) In addition to the services to be performed by Four Seasons as
contemplated by the provisions of this Agreement, Four Seasons
shall be entitled to make a proposal to Circus for the provision
by Four Seasons of all services relating to the purchase and
installation of the Personal Property for the Hotel, which
proposal shall set forth the scope of the services to be provided
by Four Seasons and the fee to be paid by Circus for the provision
of such services by Four Seasons. Circus shall give such proposal
the same consideration as any other proposal received by Circus
from other Persons for the provision of such services.
(b) In the event Circus engages any Person (other than Four Seasons or
any of its Affiliates) to provide all purchasing and installation
services relating to the Personal Property for the Hotel, Circus
shall cause such services to be performed at a level of standard
and quality consistent with that of a world class luxury hotel
comparable to the hotels and resorts operated and managed by Four
Seasons or any Affiliate thereof under the name "Four Seasons" in
North America.
IN WITNESS WHEREOF the parties have executed this Agreement on
this 10th day of March, 1998.
FOUR SEASONS HOTELS LIMITED
By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇
CIRCUS CIRCUS ENTERPRISES, INC.
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By: PRESIDENT
SCHEDULE "A"
DEFINITIONS
(a) "Building Permits" means all permits, licences or certificates of any
Governmental Authority necessary or appropriate to complete the
development and construction of the Hotel.
(b) "Construction Phase" or "Phase III" means the period set out in section
7.01.
(c) "Consultants" means all consultants required for the design,
development, construction, furnishing and equipping of the Hotel,
including (without limitation) the Project Architect and other
architects (concept and production), accountants, archaeologists,
attorneys, engineers (structural, civil, soil, mechanical, electrical,
audio visual and traffic), the general contractor and other contractors,
acoustic mechanical and electrical consultants, interior and other
designers, decorators, planners, economists, environmental specialists,
landscape consultants, kitchen and laundry consultants, traffic
consultants and other consultants or specialists.
(d) "Construction and Design Standards" means the construction and design
standards prepared by Four Seasons and delivered to Circus, with all
variations thereto which have been approved by Four Seasons during the
development and construction of the Hotel.
(e) "Consulting Fee" has the meaning set out in section 11.01.
(f) "Design Development & Working Drawings and Specifications" means the
detailed plans, specifications and drawings prepared based on the
Schematic Design Drawings for the construction of the Hotel.
(g) "Design Development & Working Drawings Phase" or "Phase II" means the
period set out in section 6.01.
(h) "Dispute" has the meaning set out in section 17.02.
(i) "FF&E Co-ordinator" has the meaning set out in section 9.02(b).
(j) "Four Seasons' Project Manager" means Four Seasons' project design and
construction manager, and shall have the meaning set out in section 9.02(a).
(k) "Hotel Design Brief" means the Hotel Design Brief dated March 2, 1998
approved by Circus and Four Seasons and attached hereto as Schedule "B".
(l) "Interest" means (i) in respect of Circus, the right, title and interest
of Circus in and to the Hotel and this Agreement, and (ii) in respect of
Four Seasons, the right, title and interest of Four Seasons in and to
(A) the business of Four Seasons of operating and managing the Hotel,
and (B) the Hotel Agreements.
(m) "Occupancy Permits" means all permits, licences or certificates from any
Governmental Authority necessary or appropriate to open the Hotel for
use and occupancy as a World Class Luxury Hotel.
(n) "Circus' Project Manager" means Circus' project design and construction
manager, and shall have the meaning set out in section 9.01.
(o) "Personal Property" means all Furniture, Fixtures and Equipment and all
Operating Equipment and Supplies.
(p) "Personal Property Budget" means the budget for the purchase of Personal
Property to be prepared by Four Seasons and approved by Circus in
accordance with the terms of this Agreement.
(q) "Personal Property Services Fee" has the meaning set out in section
11.02.
(r) "Post-Opening & Deficiencies Phase" or "Phase IV" means the period set
out in section 8.01.
(s) "Pre-Opening Plan and Budget" has the meaning set out in section
4.01(a).
(t) "Project Architect" has the meaning set out in section 5.02(b).
(u) "Project Analysis & Schematic Design Phase" or "Phase I" means the
period set out in section 5.01.
(v) "Project Budget" means the budget for the development and construction
of the Hotel to be prepared by Circus and approved by Four Seasons in
accordance with the terms of this Agreement, setting forth, in detail,
the break-down of the total estimated costs of the development and
construction of the Hotel and all appropriate categories of costs.
(w) "Proposed Pre-Opening Plan and Budget" has the meaning set out in
section 4.01(a).
(x) "Qualified Person" means a Person that, in respect of the operation of
five star or luxury hotels, (i) has adequate financial capacity to
perform the obligations of Circus under this Agreement, (ii) is not of
ill repute, and (iii) is not a Person whose prior activities, criminal
record, if any, reputation, habits and associations would cause a
prudent business Person not to associate with such Person in a
commercial venture. Any Dispute as to whether or not a Person is a
Qualified Person shall, if requested by either Circus or Four Seasons,
be resolved by arbitration pursuant to the provisions of section
17.03(b).
(y) "Schematic Design Drawings" has the meaning set out in section 5.02(b).
SCHEDULE "B"
HOTEL DESIGN BRIEF
Not Included.