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98-22850 RESO RESOLUTION NO, 98-22850 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE MANAGEMENT SERVICES AGREEMENT FOR THE MIAMI BEACH CONVENTION CENTER AND THE JACKIE GLEASON THEATER OF THE PERFORMING ARTS BETWEEN THE CITY AND SMG; SAID AGREEMENT COMMENCING ON OCTOBER 1, 1998, AND ENDING ON SEPTEMBER 30,2001, WITH TWO ONE-YEAR RENEWABLE OPTIONS, WHEREAS, the City currently owns the Miami Beach Convention Center and the Jackie Gleason Theater of the Performing Arts (collectively referred to as the Facilities); and WHEREAS, on December 5,1997, the City issued Request for Proposals No. 5-97/02 for the management and operation of the Miami Beach Convention Center and/or Jackie Gleason Theater of the Performing Arts; and WHEREAS, on April 1, 1998, pursuant to the recommendations of the Evaluation Committee and the City Manager, the Mayor and City Commission selected SMG as the top ranked proposer, and authorized the Administration to negotiate a Management Services Agreement for the Facilities with the firm; and WHEREAS, the Administration has negotiated the attached Management Services Agreement with SMG, said Agreement for the period of October 1, 1998, through September 30, 2002, plus two one-year optional renewal terms; and WHEREAS, the City has determined that the base management fee shall be $251,661.96, escalating yearly, up to five percent, based on the South Florida Consumer Price Index; and WHEREAS, SMG will also be paid an incentive fee of up to $251,661.96, also to be adjusted yearly, based on the South Florida Consumer Price Index, for a maximum of five percent per year; and WHEREAS, the Administration recommends that the Mayor and City Commission authorize the Mayor and City Clerk to execute the attached Management Services Agreement. NOW THEREFORE, BE IT DUL Y RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission herein approve and authorize the Mayor and City Clerk to execute the attached Management Services Agreement for the Miami Beach Convention Center and the Jackie Gleason Theater of the Performing Arts between the City of Miami Beach and SMG, said Agreement for the period of October 1,1998, through September 30, 2001, plus two one-year optional renewal terms. PASSED and ADOPTED this 15th day of Jf#;/i; , 1998. MAYOR ( aA rJN--.- SR/MDB/lcd F:\A TTO\AGUR\RESOS\SMGK3.RES APPROVED AS TO FORM & LANGUAGE & FOR EXECUTION /!~/ 1:U1 hi) · ~ 0 ~ ~ riot: Page ~ Service America Oversight Criteria Annually Submission of an Annual Budget, with Semi-Annual Revision projecting all activity for upcoming year Preparation of annual Marketing and Business Plan, outlining . Sales and per capita goals . Development of new sales and marketing initiatives . Introduction of operational goals . Proposed menus and pricing, along with comparable facility pricing survey . Proposed participation in sales efforts, FAM trips, etc. . Preparation of Energy Management plan SMG wilheview and audit annual financial and performance reports Ouarterly Require Quarterly Health Department Inspections of Facilities, with advance notice to SMG and results copied to SMG SMG will meet with the Service America Regional Vice President to review operations and projections Monthly Monthly Status Report to include: . Event results for the past month . Sales figures, to include comparisons to previous year results . Upcoming month events and sales activity projections . Copies of all Client Critiques received (to include Quality of Food evaluation) . Summary report of all post-event client meetings . Operational Activities SMG will prepare a compilation report to the Convention Center Advisory Board and City on Service America activity and performance SMG will perform at least monthly walk-through inspections of all Service America facilities, reviewing order, deanliness, sanitation conditions Monthly meeting with Service America General Manager to discuss monthly report and address l =~~~ --=~ -- ~- - - -.-- Page 21 - concems raised by clients Event Service America will submit an Event Summary outlining all expected catering and concessions proposed per event, to include anticipated attendance, hours of operation, proposed staffing, previous history, level of service, and responsible manager. Such summary will be reviewed and approved by SMG. This report will be submitted no later than one week prior to each event beginning, with SMG action to be completed within one business day of receipt. CITY OF MIAMI BEACH :::ITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH. FLORIDA 33139 1ttp: \\ci. miami-beach. f1.LJS COMMISSION MEMORANDUM NO, 5D9~g TO: Mayor Neisen 0, Kasdin and Members of the City Commission DA TE: July 15, 1998 FROM: Sergio Rodriguez City Manager SUBJECT: A RESOLU ON OF THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE MANAGEMENT SERVICES AGREEMENT FOR THE MIAMI BEACH CONVENTION CENTER AND THE JACKIE GLEASON THEATER OF THE PERFORMING ARTS BETWEEN THE CITY OF MIAMI BEACH AND SMG, SAID AGREEMENT COMMENCING ON OCTOBER 1, 1998, AND ENDING ON SEPTEMBER 30, 2001, WITH TWO ONE-YEAR RENEWABLE OPTIONS, ADMINISTRA TION RECOMMENDATION: Adopt the Resolution. BACKGROUND: On December 19, 1990, the City of Miami Beach entered into a Management Services Agreement with Spectacor Management Group (SMG) for the management of the Miami Beach Convention Center (lV1BCC) and the Jackie Gleason Theater of the Performing Arts (TOPA). The Agreement was for an initial term of three-years, commencing on January 1,1990, and ending December 31, 1993. On June 30, 1993, the City exercised its option to extend the Agreement for two successive one-year terms covering the period ofJanuary 1, 1994, through December 31, 1995. On April 19, 1995, the City Commission approved the waiver of formal bidding procedures for the Management Contract, thus extending the Management Services Agreement with SMG, and approving a new Agreement for the period of October 1, 1995, through September 30, 1998. On December 5, 1997, the City of Miami Beach issued Request for Proposals (RFP) No. 5-97/02, seeking proposals from qualified firms for the management and operation of lV1BCC and/or TOP A. On April 1, 1998, the City Commission adopted a Resolution for the Administration to enter into negotiations for a Management Services Agreement with the recommended firm of SMG pursuant to the recommendation of the City Manager and the Evaluation Committee. AGENDAITEM K-J]) DATE ,- \ 5-9g' 1 ANALYSIS: The following are highlights of the new Management Services Agreement: 1. The Agreement period is for October 1, 1998 through September 30, 2001, with two one-year renewable options. 2. The Agreement includes a termination for cause in the event that SMG fails to perform or comply with any of its covenants, terms and provisions. If failure continues forty-five days after written notice to SMG from the City, the City may immediately or at any time thereafter, and without further demand or notice, terminate the Agreement. 3. The City has the right to terminate the Agreement for any reason, at any time, after October 1,2001 upon a six-month prior written notice to SMG. 4. SMG shall be paid a base management fee of $251,661.96. This fee will be adjusted upward by a percentage change in the South Florida Consumer Price Index. The adjustment will not be greater than five percent in anyone year. Additionally, SMG will be entitled to a annual incentive fee of up to $251,661 with respect to each fiscal year during the term of this Agreement, in a escalating amount equal to the management fee. The incentive fee clause is similar to the one in the existing contract and is earned through the following three separate categories: . Monitoring of the Service America Contract for food services at the facilities. The City shall award SMG up to twenty-five percentage points for the performance in the administration and oversight of the food and beverage concession contract with Service America Corporation. The twenty-five points will be awarded as follows: Improvements in client evaluation results Per capita sales increase at Convention Center Per capita of sales increase at Gleason Theater 7 points 11 points 7 points . Maintenance of facilities and equipment. The City shall award SMG up to forty-five percentage points for meeting or exceeding the maintenance goals set forth in the approved and adopted maintenance and operation manual for the facilities, including the comprehensive preventive maintenance program. Such evaluation shall take into account the quarterly review of the Property Management Department, and a yearly review by an outside independent party, such as the Miami-Dade County General Services Administration Property Management Division. Additionally, on a monthly basis, a maintenance report will be submitted to the CCAB for their review. . Deficit reduction for both facilities. The City shall award SMG up to thirty percentage points based on the reduction of the combined facilities; operating deficit defined as total facilities revenues less total operating expenses. 2 Detenrunation of performance shall be compared to the preceding three-year average. The incentive received will not exceed the deficit reduction realized. The current Agreement, terminating on September 30, 1998, incentive fees are based on the following: 1. Actual revenues compared to budgeted revenues up to 60 percentage points. 2. Maintenance of facilities and equipment up to 30 percentage points. 3. Community involvement up to 10 percentage points. As a separate item, SMG has proposed to make a grant of $100,000 to the City. This sum shall be payable by October 15, 1998. The CCAB recommended for the grant to be utilized for programming in the facilities. The CCAB will present a proposal for the programming of these funds. SMG agreed to grant an additional $33,000 for each of the two renewal years upon renewal, therefore totaling $166,000 for the entire five-year Agreement, if awarded. The CCAB assisted the Administration with recommendations during the negotiation period. On June 10, 1998, the CCAB unanimously approved the proposed contract. On June 17, 1998, the City Commission requested the Administration to further detail the method/criteria by which the incentives for monitoring the Service America contract and the incentive for deficit reduction would be awarded. The Administration has revised the contract to include the requested criteria. CONCLUSION: The City Administration recommends that the City Commission approve the Resolution. SR:~;lcd Atta~~ents F:\CMGR\$ALL\COMMEMO.98\SMGK.MEM 3 CITY OF MIAMI BEACH OFFICE OF THE CITY MANAGER Interoffice Memorandum m To: Robert Parcher City Clerk Date: August 24, 1998 From: Mayra Diaz Buttacavoli, ))/;1t t)to: \/(>. /6 Assistant City Manager .. I ( rii {20/ .vqt'~ Subject: SMG CONTRACT This is in response to your request for a memorandum from me due to the outcome of the telephone conversation between you and First Assistant City Attorney Raul Aguila, on Thursday, August 20, 1998. On page 22, (2), of the SMG Contract, the "twenty-five percent" is a typographical error. The correct amount is "thirty-percent." The percentage change to thirty from twenty-five, that is initialed on page 22 (2), is the correct amount. Thank you. MDB :led Attachments ( 3 SMG Contracts for execution) c: Raul Aguila Doug Tober F:\CMGR\LCDI\MDB\MEMOS\SMGKBOB.P AR ~l -p l ~G \'vi A ~ >u(2..G T /.J-A- T ,T /.J-f1 \U1-fA,t 0 .~ ~-tW ~\t-)1l(~ Q.Drl1 Df ST~ Wl ~ ~JM>>..~' ~. BD(r. 9In\C18 .::~~' ~ r~ :::0 fI') ~ 117 ::C' f\.3 f""'\. -_:; V1'" .I (,'). ~ 111 C:> ~ """ :::: CS "" ....... " f'1'J hi ~ c:, MIAMI BEACH CONVENTION CENTER JACKIE GLEASON THEATER OF THE PERFORMING ARTS MANAGEMENT SERVICES AGREEMENT BY AND BETWEEN THE CITY OF MIAMI BEACH, FLORIDA AND SMG A GENERAL PARTNERSHIP TABLE OF CONTENTS PAGE NO. RECITALS .................................................................. 1 AGREEMENT................................................................ 2 I. SCOPE OF WORK ................................................ 2 A. Engagement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 B. The Facility ................................................ 3 C. Scope of Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 D. Repairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 E. Office Space . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 F. Parking and Storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 G. Use by the City. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 II. EMPLOYEES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 A. Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 B. Minority/ADA Hiring ....................................... 19 C. No Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 III. MANAGEMENT FEES ........................................... 20 A. Base Management Fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20 B. Incentive Fee ..............................................20 IV. OWNERSHIP................................................... 22 A. CITY Ownership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 B. CITY Responsibilities ....................................... 23 V. CONTRACT MONITORING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 A. Contract Administrator ...................................... 25 B. Duties of City Contract Administrator. . . . . . . . . . . . . . . . . . . . . . . . . . . 25 C. Quality of Service .......................................... 25 D. Contract Interpretation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 E. General Manager. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 VI. TERM OF AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 A. Initial Term ............................................... 26 B. Extension Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 C. Contract Years ............................................. 26 D. Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 E. Proration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 F. Termination for Cause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 G. Force Majeure ............................................. 28 H. Labor Dispute. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28 I. Waiver ................................................... 28 J. Procedure Upon Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28 VII. INSURANCE AND LIABILITY .................................... 29 A. SMG Requirements ......................................... 29 B. Performance Bond. . . . . . . . . . . 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 C. Premium Payment .......................................... 29 D. SMG Indemnification ....................................... 29 E. Property Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 F. Sidewalks, Rights-of-Ways and Marshaling Areas. . . . . . . . . . . . . . . . . 30 G. Subrogation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 VIII. RECORDS.................................... 0 . . . . . . . . . . . . 0 . . . . 31 A. Records and Auditing ....................................... 31 B. Audit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 IX. CONFLICTS OF INTEREST ....................................... 31 X. NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 XI. LA WS ......................................................... 33 A. Compliance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 B. Governing Law ............................................ 34 C. Equal Employment Opportunity ............................... 34 XII. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 A. Assignability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 B. Relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 C. Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 D. Complete Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 E. No Warranty/Representation for Financial Performance ofF ACIUTY .35 F. Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 G. Binding Effect .............................................35 H. Designations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 I. Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 1. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 K. Use of CITY Name and Logo .................................36 L. Right of Entry .............................................36 M. Limitation of CITY's Liability for Breach of Contract . . . . . . . . . . . . . . 36 N. Minority Contracting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 O. Convention Center Telephone Switch and Telecommunications Service 37 P. Venue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 EXHIBITS EXHIBIT A. EXHIBIT B. EXHIBIT C. EXHIBIT D. EXHIBIT E. EXHIBIT F. Contract Boundary Insurance Requirements City of Miami Beach Minimum Operating and Maintenance Standards Booking Policies Convention Center Advisory Board Documentation Agreement Between Spectacor Management Group and PACE Theatrical Group 11 MIAMI BEACH CONVENTION CENTER AND THE JACKIE GLEASON THEATER OF THE PERFORMING ARTS MANAGEMENT SERVICES AGREEMENT This Management Services Agreement ("Agreement") is entered into as of the day of , 1998 and effective as of October 1, 1998, by and between THE CITY OF MIAMI BEACH, County of Miami-Dade, a municipal corporation, organized and existing under the laws of the State of Florida, and having its principal office at City Hall, 1700 Convention Center Drive, Miami Beach, Florida, 33139 (the "City"), and SMG, a Pennsylvania general partnership, with principal offices located at Independence Center, 701 Market Street, Suite 4400, Philadelphia, Pennsylvania, 19106 ("SMG"). RECITALS WHEREAS, the CITY currently owns the Miami Beach Convention Center and the Jackie Gleason Theater of the Performing Arts, including, without limitation, all adjacent grounds, sidewalks, rights-of-way and marshaling areas, but not including the adjacent parking lots (collectively, the "FACILITY"); and WHEREAS, the CITY determined in December 1990, following a process of soliciting proposals from private management entities, to retain SMG to manage and operate the FACILITY on behalf of the CITY and to enter into a Management Services Agreement, dated as of December 19, 1990, commencing on January 1, 1990, and ending on December 31, 1993; and WHEREAS, the Agreement was extended on June 30, 1993, and expires on September 30, 1998; and WHEREAS, on December 5, 1997, the City issued Request for Proposals No. 5-97/02 for the management and operation of the FACILITY; and WHEREAS, following receipt and consideration of the two responsive proposals, an Evaluation Committee approved by the City Manager and the Mayor and City Commission recommended SMG as the top ranked proposer and authorized the Administration to negotiate a new Management Services Agreement with SMG, said Agreement having an initial term, commencing on October 1, 1998, and ending on September 30, 2001, with two optional one year renewal terms; and WHEREAS, the CITY and SMG desire to enter into this Management Services Agreement to provide for terms and conditions to apply to SMG's continuing management and operation of the FACILITY. AGREEMENT NOW, THEREFORE, in consideration of the mutual premises set forth herein, the CITY and SMG, intending to be legally bound, hereby agree as follows: I. SCOPE OF WORK A). Engagement. The City hereby engages SMG to continue to act as the CITY's sole managing agent to promote, operate, manage and maintain the FACILITY pursuant to all applicable laws and ordinances and subject to the contracts and CITY policies to which SMG was subject, under the terms ofthe Management Agreement, immediately prior to the commencement of the term hereof; and SMG hereby accepts such engagement and undertakes to perform all such management services and comply with all the provisions of this Agreement. 2 B). The Facility. SMG's services under this Agreement shall relate to the promotion, management, operation and maintenance of the FACILITY. The Miami Beach Convention Center includes the exhibit halls, meeting rooms, common areas, lobby areas, executive offices and utility facilities. The Jackie Gleason Theater of the Performing Arts includes the lobby areas, common areas, audience chambers, back stage areas, dressing rooms, stage areas and rehearsal hall. The CITY will remain the sole owner of the FACILITY. A diagram of the FACILITY is attached as Exhibit A. C). Scope of Services. SMG shall perform and furnish (subject to funding by the CITY) management services, systems and materials needed to operate, supervise, manage and maintain the FACILITY in the most efficient manner consistent with operations of other similar first class facilities, and the CITY shall provide the funds budgeted for and reasonably required to carry out such purposes during the term of this Agreement. It is the intent of the parties that SMG will have authority over the day-to-day operation of the FACILITY and all activities therein, but subject to existing contracts and subject to policies and guidelines reasonably established by, or which from time to time hereafter may be established by, the CITY. Such current and future policies shall not unreasonably interfere, impede or impair the ability of SMG to effectively manage the FACILITY. In the performance of its duties under this Agreement for management, supervision, maintenance and operation of the FACILITY, SMG shall provide the CITY with services which shall include the following: a). Supervise and direct all employees and personnel consistent with the provisions of this Agreement. 3 b). Maintain and supervise detailed, accurate and complete financial and other records of all of its activities under this Agreement in accordance with generally accepted accounting principles. In furtherance of its services to be provided pursuant to this subparagraph and elsewhere in this Agreement, SMG may use its own proprietary computer software which, in such event, shall remain the sole property of SMG. All financial records maintained pursuant to this subsection (b) shall be retained by SMG as long as such records are required to be retained pursuant to the Florida Public Records Law. All such records shall be made available to the CITY. c). Administer, assure compliance with and negotiate licenses, occupancy agreements, booking commitments, advertising agreements and concession agreements for the FACILITY, including the food, beverage and novelty agreements (if any). Such licenses and agreements which pertain to the use, operation and occupancy of the FACILITY will be executed by SMG as agent for the CITY. The terms of all such licenses and agreements shall comply with IRS Requirements as defined in Paragraph XI.A hereof. All revenues arising from the operation, promotion and management of the FACILITY pursuant to this Agreement which are earned within the term of this Agreement shall be included in revenues of the FACILITY. SMG and its affiliates or related entities will be allowed to book and promote events at the FACILITY but only at prevailing rates, fees and prices as the same shall be approved by the CITY's Contract Administrator prior to such booking or 4 promotion. SMG shall provide to the CITY's Contract Administrator complementary tickets as per City of Miami Beach Resolution No. 93-20694 for each event held at the Jackie Gleason Theater ofthe Performing Arts. d). SMG shall require that all users of the F ACIUTY provide certificates of insurance evidencing appropriate insurance, as required by "Insurance Requirements for Users/Lessees of the Facility" (attached as Exhibit B - Part 1). Copies of these certificates are to be furnished to the CITY's Contract Administrator. Such insurance is to be kept in force at all times by all licensees, users, lessees and concessionaires. All such liability policies shall name the CITY and SMG as additional insureds. SMG shall also require all users of the FACILITY to execute, among the terms of the license, agreement or occupancy agreement, to defend, running in favor of the CITY, the form of said clause to be subject to the CITY's approval. e). Submit a written report to the CITY's Contract Administrator at least monthly, or as otherwise voluntarily agreed on between the parties hereto, no later than the close of the following month concerning its activities in the operation, management, supervision and maintenance of the F ACIUTY. Such report shall, inter alia, set forth bookings, receipts from all sources, expenditures and such other and further information as the CITY may reasonably require or request. f). To the extent that the CITY has made budgeted funds available and such budgeted funds are sufficient, SMG shall maintain the F ACIUTY in the 5 condition received, reasonable wear and tear expected. However, at no time shall the maintenance of the F ACIUTY fall below the minimum standards required by Exhibit C, provided that funds are made available by the CITY for budgeted items and such budgeted items are sufficient to achieve or maintain such minimum standards. On or before the first business day following the last day of each calendar quarter occurring during the term of this Agreement, SMG shall submit a report to the CITY, with copies to the Miami Beach Convention Center Advisory Board, regarding all maintenance performed at the F ACIUTY during such calendar quarter. g). Rent, lease or purchase all non-capital, event related and ordinary maintenance supplies and equipment for the operation and maintenance of the F ACIUTY using funds in F ACIUTY accounts as provided in subparagraph (n) below. h). Administer, assure compliance with, negotiate and enter into serVIce contracts required in the ordinary course of business in operating the F ACIUTY, including, without limitation, contracts for engineering services, telephone, staffing personnel, including guards and ushers, extermination and other services which are reasonably necessary, including SMG's right to contract with, or expense to, its parent, affiliates or related entities for necessary administrative services. SMG shall execute all such contracts in its own name on behalf ofthe CITY and, in the case of contracts that have the approval of the CITY, expressly as the CITY's agent, provided that no 6 service contract shall have a term of longer than the then-remaining term of this Agreement without the approval of the City Commission, and provided further that service contracts that are to be renewed or entered into at the commencement of the fiscal year shall be reviewed by the Miami Beach Convention Center Advisory Board in conjunction with the annual budget revIew process. Any contract entered into between SMG and a subsidiary and/or affiliate company shall be at terms and for prices customarily charged by such subsidiary and/or affiliated company for comparable goods and services elsewhere and are competitive within the industry, subject to approval of the City Commission and submittal of documentation evidencing the competitive nature of the goods submitted. i). Furnish such supervisory services, as are herein set forth, as to ensure that the F ACIUTY and services shall be operated in a first class manner and with standards comparable to similar first class facilities. j). Establish and adjust prices, rates and rate schedules for the aforesaid licenses and agreements, advertising contracts and concession agreements and any other F ACIUTY commitments to be negotiated by SMG in the course of its management of the FACILITY. In determining such prices and rate schedules, SMG shall evaluate comparable charges for similar goods and services at similar and/or competing facilities in order to establish a range of prices and rates, shall consult with the Miami Beach Convention Center 7 Advisory Board and the Greater Miami Convention and Visitors Bureau on any rate adjustments at the FACILITY. In connection with any such systematic rate establishment and adjustment, SMG shall provide the CITY with a survey of current rates from other facilities, and such surveys shall be brought by the CITY to the attention of the Miami Beach Convention Center Advisory Board and the Greater Miami Convention and Visitors Bureau. Any such rate adjustments involving a rate increase shall be reviewed by the Advisory Board and the Convention and Visitors Bureau prior to final written approval of the City Commission. The difference between the rate determined by the City Commission and SMG's rate shall be applied as revenue to the FACILITY for the purposes of determining SMG's management fees hereunder. k). Prepare and provide to the CITY a proposed, detailed, line-item annual operating budget for the FACILITY in compliance with the format reasonably requested by the CITY therefore, including salary ranges for each fiscal year occurring during the term hereof, each such operating budget to be provided no later than the date specified by the City Manager. Each such budget shall be submitted together with details on the benefits package to be offered to SMG employees and funded by the CITY as an operating expense. No such benefit package shall exceed comparable benefits packages offered in similar-sized facilities and/or industry standards. SMG shall not incur FACILITY operating expenses for any fiscal year in 8 expenses set forth in the annual operating budget, as amended or supplemented, approved by the CITY. However, if extraordinary events occur which could not reasonably be contemplated at the time the budget was prepared, SMG may submit a supplemental budget to the CITY for review and approval. SMG recognizes that the CITY is a municipal corporation created pursuant to the laws of the State of Florida and is bound by general and special statutes pertaining to the budget process and the appropriation and expenditures of funds. Therefore, SMG shall participate in the CITY's budget process, including, but not limited to, an Administrative Review, a review by the CITY's Budget Advisory Committee, City Commission review and review and comment by citizens at two public hearings in the month of September prior to approval of a proposed operating budget. I). Prepare and submit, prior to October 1 st of each fiscal year that is within the term hereof, a cash flow budget, based on the approved operating budget, for such fiscal year. The CITY shall transfer to SMG, on a monthly basis, those funds so approved and necessary for the operation, management and maintenance of the FACILITY, and SMG shall deposit such funds, together with gross revenues of the FACILITY collected by SMG (other than such revenues described in subparagraph (0) below), in the FACILITY accounts referred to below. The City specifically reserves the right to withhold or delay the monthly funds referenced above if the previous monthly audited findings have not been satisfactorily resolved. 9 m). Pay all operating expense (which include, without limitation, all expenses arising from the management or operation of the F ACIUTY other than expenses attributable to interest (debt service) and capital items, as hereinafter defined, which expenses shall be paid by the CITY) for the F ACIUTY from F ACIUTY accounts established pursuant to this Agreement. If SMG is authorized by the CITY to advance its own funds in order to comply with any of the terms of this Agreement and SMG elects to do so, SMG will be reimbursed the amount of such advance(s), plus all accrued interest thereon at SMG's cost for borrowing such money at a local banking institution within thirty (30) days after the presentation of invoices by SMG. n). After consultation with the City Attorney, institute in its own name as managing agent for the CITY, but in any event, at the reasonable expense of the CITY, any and all legal actions or proceedings to collect charges, rents or other income generated by and due to the CITY, or to cancel or terminate any license, use or concession agreement for the breach thereof or default thereunder by any licensee, user, advertiser, or concessionaire after consultation with the CITY. No legal action or termination proceeding shall be commenced against Service America Corporation or National Data Communications Inc., without the prior written consent of the City Manager and the City Attorney. SMG shall use the services of the City Attorney's Office when instituting said legal actions. However, to the extent it is not 10 feasible to use said services, legal expenses shall be included as an operating expense of the FACILITY. 0). Hold in escrow, in an interest-bearing account in a banking institution in Miami Beach, any ticket sale revenues which it receives in the contemplation of or arising from an event pending the completion of the event. Such escrow monies are to be held for the protection of ticket purchasers, the CITY and SMG, and to provide a source of funds, as required for such payments to performers and for such payments of direct incidental expenses in connection with the presentation of events as may be required to be paid prior to or contemporaneously with the event. Following the satisfactory completion of the events, SMG shall make a deposit into the FACILITY operating account(s). Interest accrued in the escrow account shall be part of the operating income so long as SMG is not required to pay such interest to the promoter pursuant to its respective license agreement with the promoter. Bank service charges, if any, on such account(s), shall be considered an operating expense of the FACILITY. p). SMG shall submit, within twenty-five (25) days following the close of each month or as reasonably prescribed by the CITY, copies of records and reports related to the receipts and expenditures with respect to all events occurring during such month at the FACILITY. Such records and reports shall be in a form customarily prepared by SMG at other SMG-managed facilities and shall include a comparison of revenues and expenses for the corresponding 11 months in the prior two (2) fiscal years. The CITY shall review all operating expenses before reimbursing SMG for any cash flow deficiencies that otherwise would be reimbursable to SMG pursuant to subparagraph (1) above, and the CITY shall fund such deficiencies in full except for any amount attributable to expenses paid by SMG that the CITY determines are not consistent with the term of this Agreement, provided however, in no event shall the period for the CITY's review of said operating expenses exceed a reasonable period oftime. The CITY and SMG shall resolve any issues with respect to expenses within thirty (30) days of report of same by SMG. q). Upon receipt thereof from the depository bank, submit to the CITY, as requested, copies of all bank statements concerning the escrow account(s) established by SMG pursuant to subparagraph (0) above. r). SMG shall promote, solicit and/or produce on its own, in association with or through a local or regional promoter, an annual series of concerts and special entertainment events during the summer season (the period from May 1 - September 30) at the Jackie Gleason Theater of the Performing Arts. Such annual series shall contain a minimum of five (5) separate and distinct, major entertainment events. The cost of such series shall not be included as an operating expense of the FACILITY, but SMG shall be entitled to use funds on deposit in the promotional fund established by SMG for co-promotion purposes to offset costs of such series. 12 s). SMG shall maintain an ongomg relationship with vanous boards and committees of the CITY, which would include but not be limited to; the Miami Beach Tourism and Convention Center Expansion Authority, the Miami Beach Convention Center Advisory Board, and the Greater Miami Visitor and Convention Bureau. t). SMG shall, from time to time, revise the marketing plan for the F ACIUTY as SMG determines is necessary or appropriate to maintain the currency of such plan, and SMG shall solicit comments from the CITY and the appropriate various boards and committees outlined in subparagraph(s) above. u). SMG shall follow the Miami Beach Convention Center's established booking policies, as same may be amended from time to time (Exhibit D), in the operation of the F ACIUTY and hold the master set of all booking records and schedules. SMG shall, from time to time, review the booking policy and recommend changes, if any, in the booking policy to the CITY. SMG's recommended changes shall be subject to the approval of the Miami Beach Convention Center Advisory Board. Should the Advisory Board reject SMG's recommended changes, SMG shall have the right to appeal to the City Commission. Upon any approval of the City Commission, the CITY will modify the booking policy to include SMG's recommended changes. v). Notwithstanding anything to the contrary herein, SMG shall adhere to the contract between the CITY and Pace Theatrical Group for performances in 13 the Jackie Gleason Theater of the Performing Arts. SMG will adhere to the dates and rates in accordance with Exhibit F. w). SMG shall supervise and monitor the contract between the CITY and Service America Corporation for food and beverage concessions at the FACILITY. SMG shall also provide, or cause to be provided, to the Miami Beach Convention Center Advisory Board quarterly status reports as to Service America's performance under said Agreement. x). SMG shall act as a collection agent for the CITY on the $1.00 (one dollar) surcharge on all tickets sold for performances held at the Jackie Gleason Theater of the Performing Arts. Further, SMG shall work with the Miami Beach Convention Center Advisory Board on the administration of the surcharge in accordance with the resolution attached in Exhibit E. Said surcharge shall not be included in revenues for the FACILITY. y). SMG shall act as a collection agency for the CITY on Sales Tax and shall remit to the State of Florida said Sales Tax. Sales Tax shall not be included in revenues for the FACILITY. z). SMG shall cause such acts and things to be done in and about the FACILITY as SMG shall determine to be necessary with respect to the operation, control, supervision and maintenance of the FACILITY. Both SMG and the CITY shall, throughout the term of this Agreement, comply with all statutes, ordinances, laws, rules, regulations, orders and requirements by any Federal, State or County government departments, commissions, boards and offices 14 having proper jurisdiction respecting the use or manner of the use of the FACILITY or the construction, maintenance and operation thereof, as well as with all orders and requirements of the Fire Department or any other body which may hereinafter exercise similar functions, provided that it shall be the responsibility of the CITY to inform SMG of any requirements imposed on the FACILITY, from time to time, as a result of the CITY's tax-exempt financing of the FACILITY or any portion thereof. aa). Except as otherwise approved by the CITY, SMG shall not sub-lease any portion of the FACILITY to other than short-term users. bb). Greater Miami Convention and Visitors Bureau (GMCVB) is responsible for marketing the Convention Center for conventions and trade shows, and to carry out this responsibility, will have control over all bookings more than twenty-four (24) months in advance; however, all such bookings shall be coordinated with SMG before commitment. SMG will assist the GMCVB on an as-needed basis by providing resource people to work with the GMCVB and, when reasonably requested, accompany them in their solicitation efforts, provided that the GMCVB assists SMG in minimizing the cost of such travel. The GMCVB will also book conventions and trade shows into the Convention Center with less than twenty-four (24) months' lead time if the dates have not been confirmed to other users and with the approval of SMG, which approval shall not be unreasonably withheld. Additionally, subject to compliance with the Booking Policies set forth as 15 Exhibit D, SMG may also book non-convention and trade show events in the Convention Center with more than twenty-four (24) months' lead time if the dates have not been confirmed to other users and with the approval of the GMCVB. Dates booked in this manner shall be considered tentative until formally approved by the GMCVB. cc). SMG shall have the sole authority, subject to the Booking Policies set forth as Exhibit D, to approve the scheduling of any event in the Convention Center within the twenty-four (24) month booking window and all events in the Jackie Gleason Theater of the Performing Arts. Events of a non- traditional nature, including multi-year user contracts of a non-traditional nature, and events requiring or having co-promotions, shall be subject to the review and recommendation of the Miami Beach Convention Center Advisory Board prior to scheduling. dd). SMG shall provide the CITY and the Convention Center Advisory Board with a monthly report regarding the status of pending user agreements. Said monthly report shall also include a summary of all exit conferences at the Miami Beach Convention Center. ee). The comprehensive preventive maintenance program submitted to the CITY as part of the preceding Agreement shall be used as the part of the basis for the evaluation of SMG's maintenance of facilities and equipment under Section III.B.(4) hereof. 16 D). Repairs. SMG shall inform the CITY of any condition of which SMG becomes aware which SMG believes impairs the structural soundness or sound operating condition of the FACILITY or otherwise adversely affects the ability of SMG to perform under this Agreement. It is understood that the CITY will make its own determination as to the structural soundness of the FACILITY or any defect that might be noted by SMG and as to the nece'isity for repair. The CITY will, subject to appropriation, make available funds necessary to correct such condition within such time as is required under the circumstances and as the CITY deems any repair or correction necessary . a). SMG shall have the right to act with consent of the CITY in situations which SMG determines to be an emergency with respect to the safety, welfare and protection ofthe general public, including spending or committing funds held in the FACILITY accounts even if such expenses are not budgeted, provided, however, SMG shall have no obligation under any circumstance to spend or commit funds other than funds then available in the FACILITY accounts for any such purpose. Immediately following such action, SMG shall inform the CITY of the situation and the action taken and the CITY shall pay SMG, for deposit in the F ACIUTY accounts, the amount of funds, if any, spent or committed by SMG pursuant to this subparagraph (a) in excess of budgeted amounts. b). Any expenditure to obtain, replace or repair any capital items, as hereinafter defined, related to the operation of the FACILITY in excess of$500 shall not be construed or determined to be an operating expense under this Agreement 17 for the purpose of determining any management fee to be earned by SMG hereunder. Capital items shall be defined to include all fixtures, signs, displays, equipment, machinery, structures, appurtenances, improvements, alterations, systems (including, but not limited to, plumbing system, electrical system, wiring and conduits, heating and air conditioning systems), and items of identical or similar nature and character, including, for example, seats and chairs, which are replaced and/or repaired III multiple units contemporaneously. The expense sum for such repairs, maintenance or replacement for multiple units shall be the total cost of same for all such multiple units. E). Office Space. The CITY shall provide SMG with necessary office space in the FACILITY and such equipment as is currently available in the FACILITY. F). Parking and Storage. The CITY shall provide SMG with unrestricted egress and ingress to the FACILITY and shall make available to SMG at no cost parking spaces adjacent to the FACILITY or located on CITY property in the immediate environs. All parking lots and garages adjacent to the FACILITY are excluded from the scope of this Agreement. G). Use by the City. The CITY shall have the right to use the FACILITY or any part thereof subject to availability for the benefit of the community for such purposes as (including, but not limited to) meetings, labor negotiations and training classes without the payment of any rental or use fee, except that direct out-of-pocket expenses incurred in connection with such uses shall be paid by the CITY. CITY uses of the FACILITY shall not be competitive with, nor conflict with, paying events booked by SMG and shall be booked in advance upon reasonable notice. CITY use 18 of the FACILITY shall not result in a revenue credit at the prevailing rate in computing revenues of the FACILITY for purposes of determining any management fee payable to SMG hereunder. II. EMPLOYEES A). Employees. In connection with the performance of its responsibilities hereunder, SMG may hire its own employees who will be employees ofSMG and not of the CITY but whom shall be paid from the funds allocated by the CITY for this purpose. SMG shall select the number, function, qualifications, compensation, including benefits and may, at SMG's reasonable discretion, periodically adjust or revise the terms and conditions relating to such employees. B). Minority/ADA Hiring. SMG shall use its best efforts to interview and employ qualified minority individuals at the FACILITY, giving minority applicants a reasonable opportunity to fill open positions. To facilitate this process, SMG shall advertise open positions at the FACILITY in a cross-section of appropriate newspaper publications that will ensure that minorities will be aware of opportunities at the FACILITY. SMG will use its best efforts to assure that its hiring practices comply with Title I of the Americans with Disabilities Act of 1990, as amended (the "ADA"). C). No Solicitation. During the period commencing on the date hereof and ending one (l) year after the termination or expiration of this Agreement, except with SMG's prior written consent, the CITY will not, for any reason, solicit for employment, or hire, any of the senior management personnel employed by SMG at the Facility, including, without limitation, the general manager and director level employees. In addition to any other remedies which SMG may have, specific performance in the form of injunctive relief shall be available for the enforcement of this prOVISIOn. 19 III. MANAGEMENT FEES A). Base Management Fee. As base compensation to SMG for providing the services herein specified during the term hereof, the CITY shall pay SMG during the term hereof an annual fixed fee of $251 ,661.96, which amount shall be adjusted upward on the first day of each fiscal year during the term hereof (including an adjustment upward as of October 1, 1998) by the percentage change in the Consumer Price Index -- All Urban Consumers (CPI-U) -- Southern Florida City Average -- All Items, during the one year period ending in July immediately preceding such fiscal year, as published by the Bureau of Labor Statistics of the u.s. Department of Labor, or of any revised or successor index hereafter published by the Bureau of Labor Statistics or other agency of the United States Government succeeding to its functions, provided that any such percentage change greater than 5% with respect to anyone year shall be ignored for purposes of this adjustment. The foregoing annual fixed compensation shall be payable in equal monthly installments due on or before the last day of each month during such fiscal year. B). Incentive Fee. In addition to the base management fee set forth above, SMG shall be entitled to, and shall receive from the CITY, an annual incentive fee with respect to each fiscal year during the term of this Agreement in an amount equal to the product of (x) the aggregate amount of the base management fee for such fiscal year and (y) the Applicable Percentage (as hereinafter defined). The Applicable Percentage shall be a percentage equal to the sum of the percentage credits which SMG earns pursuant to subparagraphs (1 through 3) below with respect to such fiscal year, provided that in no event shall the Applicable Percentage for any fiscal year exceed 100%. Promptly following the end of each fiscal year during the term hereof, the CITY shall total the percentage credits which SMG has earned during the preceding fiscal year and provide SMG 20 with a written report with respect thereto. I). Maintenance of Facilities and Equipment. The CITY shall award SMG up to Forty-Five (45) percentage credits for a fiscal year if SMG has met or exceeded the maintenance goals set forth in the approved and adopted maintenance and operation manual for the F ACIUTY (including the comprehensive preventive maintenance program referred to in Section I.C.(ee) above). Such evaluation shall take into account the quarterly review of the CITY's Property Management Department regarding SMG's maintenance performance during such fiscal year, and an annual review of SMG's maintenance reports and the maintenance reports of the CITY's Property Management Department regarding the afore stated, by an outside independent party selected by the CITY (i.e. such as, but not limited to, the Miami-Dade County General Services Administration Property Management Division). Additionally, on a monthly basis, a maintenance report will be submitted by SMG to the Convention Center Advisory Board for its review. 2). Financial Performance / Deficit Reduction for the F ACIUTY. The CITY shall award SMG up to thirty (30) percentage credits based on the reduction of the combined F ACIUTY operating deficit, defined as total F ACIUTY revenues less total operating expenses, excluding depreciation, the SMG Management Fee, any other operating expenses not under the direct control of SMG, and any Convention Development Tax monies and any interest earned thereon; but not taking into account an increase in revenues for 21 changes in charges for electrical services to exhibitors, and changes in rental rates, exclusive of the cost of living increase for associated expenses above the CPI-U -- South Florida City Average. Determination of performance shall be compared to a three (3) year average, including Fiscal Years 1995/1996, 1996/1997, and 1997/1998. Notwithstanding the foregoing, SMG shall only be entitled to the award of a~\amJ nt not to exceed a -#'i(~ 307,.J;:).1;J * maximum of tW€lflt lY-e. percent (~) of the annual operating deficit reduction, as same is defined herein; and in no event shall said amount exceed the maximum annual incentive fee allowable under this Section III.B. 3). Monitoring of Food and Beverages Services. The CITY shall award SMG up to twenty-five (25) percentage credits for supervising and monitoring food and beverage operations at the FACILITY. Attention to quality controls, levels of service, and performance standards shall be considered. Criteria for evaluation shall be as follows: a) Client Evaluation results - 7 points; Per capita sales at Miami Beach Convention Center - 11 points; Per capita sales at Jackie Gleason Theater of the Performing Arts - 7 points. b) Goals and objectives to be used in the monitoring for results evaluation shall be developed jointly by the CITY, SMG and Service America, the CITY's food and beverage concesSIOnmre. IV. OWNERSHIP A). CITY Ownership. The ownership of buildings and real estate, technical and office 22 equipment and facilities, furniture, displays, fixtures and similar property shall remain with the CITY. Property rights will not accrue to SMG, with the exception of proprietary computer software which shall remain the sole property of SMG. However, any type of computer software which is designed specifically for use by the FACILITY will become and remain the property of the CITY. B). CITY Responsibilities. Notwithstanding anything to the contrary herein, the CITY will pay, keep, observe and perform, all payments, terms, covenants, conditions and obligations under any bonds, debentures or other security agreement or contract to which the CITY is bound with respect to the FACILITY, and SMG shall have no obligation with respect to any of the foregoing. a). The CITY will make available to SMG for the operation, maintenance, supervision and management of the FACILITY, all funds necessary to pay the aggregate amount of expenses set forth in the applicable annual operating budget approved by the CITY, plus all items of expense not budgeted but approved by the CITY and the amount of any emergency expenditures pursuant to Section J.D. (a) hereof. To the extent SMG is unable to perform under this Agreement due to the fact that budgeted funds are insufficient, SMG will not be considered in breach of this Agreement nor shall same be considered an event of default. b). SMG will conduct and submit to the CITY on or prior to July 30th of each year during the term hereof an inventory of capitalized furniture, fixtures and hequipment of the FACILITY. 23 c). Any data, equipment or materials furnished by the CITY to SMG and any such data, equipment or materials that may be acquired for the CITY by SMG for use at the FACILITY shall remain the property of the CITY, and when no longer needed for the performance of this Agreement, shall be returned to the CITY. d). Whenever, under any provision of this Agreeme:lt, the approval or consent of either party is required, the decision thereon shall be given promptly and such approval, authorization or consent shall be given promptly and such approval, authorization or consent shall not be withheld unreasonably or arbitrarily. e). The CITY shall continue to provide, at no cost to the FACILITY or SMG, those goods and services previously supplied or provided, the costs of which may not have been reflected as operating expenses in the FACILITY'S financial statements prior to SMG's engagement as managing agent. Such services shall not include those which are deemed to be the responsibility of SMG as stated in this Agreement. f). In the event that SMG requests a capital improvement, the CITY will give reasonable consideration to such request(s) in formulating its budget in light of competing municipal consideration. g). The CITY shall fund the budgeted operating cost of the FACILITY in accordance with the cash flow budget submitted by SMG (Section I, Paragraph C.1) and approved by the CITY. 24 h). The CITY will cooperate to the extent reasonably required to secure all licenses and permits needed for the operation and use of the FACILITY. Subject to receipt of such cooperation from the CITY, it shall be SMG's sole responsibility to obtain all licenses and permits needed for the operation and use ofthe FACILITY. V. CONTRACT MONITORING A). Contract Administrator. The CITY'S Contract Administrator shall be the City Manager or his designee. SMG shall name a specific individual to serve as their Contract Administrator. B). Duties of City Contractor Administrator. The CITY'S Contract Administrator shall have the authority to give all approvals for the CITY while administrating this Agreement, with the exception of items which would require City Commission approval. The CITY'S Contract Administrator: a). Shall be the liaison between SMG and the CITY on all matters relating to this Agreement. b). Shall be responsible for ensuring that any information supplied by SMG is properly distributed to the appropriate CITY Departments. c). Shall be responsible for the day-to-day monitoring and assessment of the quality of services provided by SMG and contract compliance by SMG. C). Ouality of Service. The CITY shall have the power to review and monitor SMG's activities, operations, management and maintenance of the FACILITY. 25 D). Contract Inteq>retation. SMG shall accept the reasonable assessments and decisions of the CITY's Contract Administrator as binding in matters of contract interpretation, provided however, that SMG has the right to appeal such decision to the City Commission within thirty (30) days of such an assessment or decision. E). General Manager. SMG shall name an individual as the General Manager of the F ACIUTY. The General Manager: a). Shall be the liaison between the CITY and SMG on all matters relating to this Agreement. b). Shall be responsible for the day-to-day management and supervision of the F ACIUTY. c). Shall be responsible for providing supervision and direction to F ACIUTY employees. The General Manager of the F ACIUTY shall be removable for cause upon the written request or recommendation of the CITY. VI. TERM OF AGREEMENT A). Initial Term. The term of this Agreement shall be for a period of three (3) years, commencing on October 1,1998, and ending on September 30, 2001. B). Extension Option. The City shall have the right to extend this Agreement for two (2) successive additional one (1) year terms by giving written notice to SMG of such intention not less than ninety (90) days prior to the expiration of the initial term or any exercised option term. C). Contract Years. For the purposes of this Agreement, the term "contract year" shall mean successive twelve (12) month periods commencing upon the commencement of this 26 Agreement and concluding one (1) calendar year thereafter. D). Fiscal Year. For purposes of this Agreement, the term "fiscal year" shall mean successive twelve (12) month periods commencing October 1 and concluding September 30. E). Proration. In the event that this Agreement shall terminate prior to the end of its anticipated term for any reason, any amounts payable to SMG pursuant to this Agreement, shall be prorated. F). Termination for Cause. If either the CITY or SMG shall be adjudicated bankrupt or insolvent, or if any receiver or trustee of all or any part of the business property of either party shall be appointed and shall not be discharged within sixty (60) days after appointment, or if either party shall make an assignment of its property for the benefit of creditors or shall file a voluntary Petition in Bankruptcy, or insolvency, or shall apply for reorganization or arrangement with its creditors under the Bankruptcy or Insolvency Laws now in force or hereinafter enacted, Federal, State or otherwise, or if such Petition shall be filed against either party and shall not be dismissed within sixty (60) days after such filing, then the other party may immediately, or at any time thereafter, and without further demand or notice, terminate this Agreement without being prejudiced as to any remedies which may be available to it for breach of contract. In the event that SMG or the CITY fails to perform or observe any of the covenants, terms or provisions under this Agreement and such failure continues thirty (30) days after written notice thereof from the other party hereto, such non- defaulting party may immediately, or at any time thereafter, and without further demand or notice, terminate this Agreement without being prejudiced as to any remedies which may be available to it for breach of contract. In the event that a default is not reasonably susceptible to being cured within such period, the defaulting party shall not be considered in default if it shall within such 27 period have commenced with due diligence and dispatch to cure such default and thereafter completes with dispatch and due diligence the curing of such default. G). Force Majeure. Neither party shall be obligated to perform hereunder and neither party shall be deemed to be in default if performance is prevented by: a). Fire not caused by negligence of either party, earthquake, flood, act of God, civil commotion occurring at the FACILITY during or in connection with any event or other matter or condition of like nature; or b). Any law, ordinance, rule, regulation or order of any public or military authority stemming from the existence of economic or energy controls, hostilities, war or government law or regulation. H). Labor Dispute. In the event of a labor dispute which results in a strike, picket or boycott affecting the FACILITY or services described in this Agreement, SMG shall not thereby deem to be in default or to have breached any part of this Agreement, unless such dispute shall have been caused by illegal labor practices or violations by SMG of applicable collective bargaining agreements and there has been a final determination of fact which is not cured by SMG within thirty (30) days. I). Waiver. No consent or waiver, express or implied, by either party, to or of any breach of any covenant, condition or duty of the other, shall be construed as a consent to or waiver of any other breach of the same, or any other covenant, condition or duty. J). Procedure Upon Termination. Upon the expiration or termination ofthis Agreement, SMG shall promptly surrender and deliver to the CITY, the FACILITY and all equipment, supplies and records, including all books of account relating to the operation of the FACILITY, escrow 28 accounts, and inventories which are the property of the CITY, as received, except for (I) normal wear and tear (or wear and tear attributable to the failure of the CITY to fund adequately the operation, management or maintenance of the FACILITY) and (ii) consumable assets consumed by SMG in performing its duties hereunder. Upon such surrender, the CITY shall make all payments due SMG as set forth in this Agreement (it being understood that all unpaid management fees accrued to the date of termination, including pro-rated incentive management fees, shall thereupon be due and payable in full). Following such expiration or termination, SMG shall provide its proprietary software for a period of not less than 180 (one hundred eighty) days at a specified monthly charge to allow the CITY a transitional period for computer conversion. VII. INSURANCE AND LIABILITY A). SMG Requirements. SMG shall, at all times during the full duration of this Agreement, adhere to the insurance requirements listed in Exhibit B. B). Performance Bond. SMG agrees that upon the execution of this Agreement to have in affect a performance bond in the amount of $500,000 (five hundred thousand dollars) covering the faithful performance of this Agreement and the payment of all obligations arising thereunder. C). Premium Payment. Notwithstanding anything to the contrary contained herein, the insurance premiums, other than those provided by the CITY, shall be considered as operating expenses, for insurance coverages required by this Agreement. The cost of all insurance premiums shall be paid directly by the CITY, with the exception of the Performance Bond and Employee Dishonesty Coverage. D). SMG Indemnification. a). SMG shall indemnify, hold harmless and defend the CITY, its agents, 29 servants and employees from and against any claim, demand or cause of action of whatsoever kind or nature arising out of error, omission or negligent act of SMG, its agents, servants or employees in the performance of services under this Agreement. b). In addition, SMG shall indemnify, hold harmless and defend the CITY, its agents, servants and employees from and against any claim, demand or cause of action of whatever kind or nature arising out of any conduct or misconduct of SMG not included in the paragraph above and for which the CITY, its agents, servants or employees are alleged to be liable. c). The foregoing indemnification shall be insured as provided in Exhibit B - Part 2. E). Property Insurance. The CITY shall obtain and maintain comprehensive all-risk property insurance for the F ACIUTY and shall cause SMG to be named as an additional insured thereunder. The cost of such insurance shall be included as an operating expense, subject to the limits in VIII.C above, for purposes of this Agreement. F). Sidewalks. Right-of- Ways and Marshaling Areas. References in this Agreement to sidewalks, rights-of-ways and marshaling areas are for general custodial cleaning and maintenance by SMG and are not intended to include repairs to such areas or any liability resulting from needed repairs to such areas. The CITY assumes responsibility for repairs to such areas, provided however, SMG shall give the CITY written notice of repairs that SMG believes are needed. 30 G). Subrogation. The terms of insurance policies referred to in this Section VII shall preclude subrogation claims against SMG, its partners, the CITY and their respective officers, employees and agents. VIII. RECORDS A). Records and Auditing. SMG shall maintain current, accurate and complete financial records on an accrual basis of accounting relating to its activities at the FACILITY. The systems and procedures used to maintain these records shall include a system of internal controls and all accounting records shall be maintained in accordance with generally accepted accounting principles and shall be open to inspection and audit by the CITY upon reasonable prior request. B). Audit. For each full or partial year of this Agreement, the CITY may, at its option, cause an audit to be conducted at its cost and expense. The cost of such an audit shall not be included in operating expenses for the purposes of determining any management fees earned by SMG. IX. CONFLICTS OF INTEREST SMG is familiar with the provisions of The Dade County Code, City of Miami Beach Code, and Florida Statutes, and hereby certifies that it will make a complete disclosure to the CITY of all facts bearing upon any possible conflict, direct or indirect, with its performance that it believes any officer or employee of the CITY now has or will have. Said disclosure shall be made by SMG contemporaneously with the execution of this Agreement and at any time thereafter that such facts become known to SMG. SMG shall perform services under the Agreement in a manner so as to show no preference for other facilities managed by SMG with regard to management, booking and operation of this FACILITY. 31 The CITY recognizes that SMG, or its affiliates, may enjoy indirect economic benefits from the operation of the FACILITY. However, SMG will perform its obligations under this Agreement in a manner consistent with the best interest of the CITY. Additionally, SMG shall provide the CITY with an annual update listing any expected ancillary sources of revenue/income to SMG or its affiliates arising from operation of the FACILITY no later than May 15 of each fiscal year during the term hereof. x. NOTICES All notices, consents, waivers, directions, requests or other instruments or communications provided for under this Agreement, shall be deemed properly given if, and only if, delivered personally or sent by registered or certified United States mail, postage prepaid, as follows: a). If to the CITY: City of Miami Beach City Manager 1700 Convention Center Drive Miami Beach, FL 33139 Attn: Mayra Diaz Buttacavoli and City of Miami Beach City Attorney 1700 Convention Center Drive Miami Beach, FL 33139 b). If to SMG: SMG 701 Market Street, Suite 4400 Philadelphia, PA 19106. Attention: Mr. Wes Westley, President 32 and SMG General Manager 1901 Convention Center Drive Miami Beach, FL 33139 Either party may at any time change the address where notices are to be sent or the party or persons to whom such notices should be directed by the delivery or mailing to the above person or parties, of a notice stating the change. XI. LA WS A). Compliance. SMG shall comply with all applicable City, County, State and Federal ordinances, statutes, rules and regulations. To the extent funds are made available therefor by the CITY, SMG shall use all reasonable efforts to cause the FACILITY and its programs to comply fully with Titles I, II and III ofthe ADA and comparable Florida law (553.501 to 553.513 Florida Statutes and Chapter 760 Florida Statutes) and related regulations. The CITY has funded a comprehensive study of the ADA compliance at the FACILITY by an independent professional with demonstrated expertise and experience with ADA compliance. SMG will be responsible for overseeing the ADA compliance changes approved and funded by the CITY. The CITY intends to comply with Internal Revenue Service regulations, rulings, notices or procedures ("IRS Requirements") issued prior or subsequent to the date of this Agreement, governing the management of governmental facilities financed with the proceeds of tax-exempt bonds, and in particular any such IRS Requirements which implements Section 1301(e) of the Tax Reform Act of 1986. Notwithstanding any other provision of this Agreement, ifany provision of this Agreement conflicts with any IRS Requirements, then the parties shall amend this Agreement to the extent necessary to achieve compliance upon notice 33 thereof from the CITY. The benefits of any such changes would accrue to the parties. B). Governing Law. This Agreement shall be deemed to have been made and shall be construed and interpreted in accordance with the laws of the State of Florida. In case of any inconsistency between the terms of this Agreement and any applicable general or special law, said general or special law shall govern. C). Equal Employment Opportunity. Neither SMG nor any affiliate ofSMG performing services hereunder pursuant hereto, will discriminate against any employee or applicant for employment because of race, creed, sex, color, national origin or disability as defined in Title I of ADA. SMG will take affirmative steps to utilize minorities and females in the work force and in correlative business enterprises. XII. MISCELLANEOUS A). Assignability. This Agreement may not be assigned, in whole or in part, by SMG. B). Relationship. Nothing contained in this Agreement shall constitute or be construed to be or create a partnership or joint venture between the CITY and SMG. C). Modifications. This Agreement cannot be changed or modified except by agreement in writing executed by all parties hereto. SMG acknowledges that no modification to this Agreement may be agreed to by the CITY unless approved by the City Commission. D). Complete Agreement. This Agreement, constitutes all of the understandings and agreements of whatsoever nature or kind existing between the parties with respect to SMG's management ofthe FACILITY. This Agreement is specifically intended to supersede RFP No. 5- 97/02, and SMG's proposal in response thereto. 34 E). No WarrantylRepresentation for Financial Performance ofF ACILITY. SMG makes no guarantee, warranty or representations concerning the financial performance or results of the FACILITY. F). Headings. The section and paragraph "HEADINGS" contained herein are for convenience of reference only and are not intended to define, limit or describe the scope or intent of any provision of this Agreement. G). Binding Effect. This Agreement shall be binding upon and insure to the benefit of the parties hereto and their respective successors and permitted assigns. H). Designations. Whenever the context of this Agreement requires, the masculine gender includes the feminine or neuter and the singular number includes the plural. I). Clauses. The illegality or invalidity of any term or clause of this Agreement shall not effect the validity of the remainder of the Agreement, and the Agreement shall remain in full force and effect as if such illegal or invalid term or clause were not contained herein unless the elimination of such provision detrimentally reduces the consideration that neither party is to receive under this Agreement or materially affects the continuing operation of this Agreement. J). Severability. If any provision of this Agreement or any portion of such provision or the application thereof to any person or circumstance shall be held to be invalid or unenforceable or shall become a violation of any local, state or Federal laws, then the same as so applied shall no longer be a part of this Agreement but the remainder of the Agreement, such provisions and the application thereof to other persons or circumstances shall not be affected thereby and this Agreement as so modified shall. 35 K). Use of CITY Name and Logo. SMG shall have the right to use, for the term of this Agreement, the CITY's name and logo on stationery, in advertising and whenever conducting business for the FACILITY with the form of such logo subject to the prior approval ofthe CITY. L). Right of Entry. The CITY through the CITY's Contract Administrator or at the direction of the City Manager, shall at all reasonable times, have the right to enter into and upon any and all parts of the FACILITY for the purpose of examining the same for any reason relating to the obligations of the parties to this Agreement. M). Limitation of CITY's Liability for Breach of Contract. The CITY desires to enter into this Agreement placing the operation and management of the FACILITY in the hands of a private management entity, only if in so doing the CITY can place a limit on its liability for any cause of action for breach of this Agreement, so that its liability for any such breach never exceeds the sum of $500,000. SMG hereby expresses its willingness to enter into this Agreement with a $500,000 limitation on recovery for any action for breach of contract. Accordingly, and in consideration of a separate consideration of $1 ,000, the receipt of which is hereby acknowledged, the CITY shall not be liable to SMG for damages to SMG in an amount in excess of $500,000 for any action for breach of contract arising out of the performance or nonperformance of any obligations imposed upon the CITY by this Agreement. Any base management fee or additional percentage fee earned by SMG but not paid by the CITY shall not be included within the $500,000 limitation. Nothing contained in this paragraph or elsewhere in this Agreement is in any way intended to be a waiver of the limitation placed upon the CITY's liability as set forth in Florida Statutes, Section 768.28. 36 N). Minority Contracting. SMG shall use its best efforts to bid and contract with an appropriate number of qualified minority vendors. Such bidding will be documented for the CITY's review. Further, SMG shall work and communicate with the CITY's Purchasing Department relative to this issue. Where qualified vendors are available to bid, SMG will include at least one quote from minority owned companies when making purchases in excess of two hundred fifty dollars ($250.00). 0). Convention Center Telephone Switch and Telecommunications Service. The CITY continues to reserve the right to competitively bid the management and operations of the Convention Center's Telephone Switch and Telecommunications Service (the "Switch"). The CITY shall have the option, upon thirty (30) days prior written notice to SMG, and provided there is no binding agreement that entitles a third party to perform such work then in existence, to cause SMG to assume management and operation ofthe Switch at no additional management fee to the CITY. Upon such written notice, SMG will prepare formal operations plan for the Switch. Within thirty (30) days of such notice from the CITY, SMG will provide the CITY with such plan, together with a complete analysis and inventory of the Switch from SMG personnel familiar therewith at no charge to the CITY. Following the assignment of such responsibilities to SMG, all costs of operating the Switch shall be considered operating expenses that are subject to CITY funding as provided herein. To the extent that the CITY elects during a fiscal year to assign such responsibilities to SMG after the budget for such year has been approved by the CITY, the budget for such year shall be deemed automatically amended for all purposes hereunder to reflect all operating expenses. SMG shall not be entitled to delegate any assignment of duties pursuant to this paragraph without the prior written consent of the CITY. 37 P). Venue. This Agreement shall be enforceable in Miami.Dade County, Florida, and if legal action is necessary by either party with respect to the enforcement of any or all of the terms or conditions herein exclusive venue for the enforcement of same shall lie in Dade County, Florida. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized officers and representatives as of the day and year first above written, as a sealed instrument. SMG PRESIDENT ~~C~ S TARY THE CITY OF MIAMI BEACH ATTEST: J1~r ~d;t~ CITY CLERK RJA\kw F:IA TTOIAGURIAGREEMNTlMGMT AGR3.SMG APPROVED AS TO FORM & LANGUAGE & FOR EXECUTION 111. f/ldt;fl:- 7/ / ~/1r Ctfy Attorney r " 38 " a: w I- :z w <..) - 19TH STREET . .... . - - - --. - -.... :z o - I- :z w > :z o <..) - ... ~ , ..- ". ~"n liT 'II NORTH - . .e . . . . . ....;...:.:.:.:.:;:;. . . .;.:.:.:~:;:.:.:.:.:::::::::::::::.::::::::::::::::::.:.:.:::.:.:.: .::::.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:::::::.::::::: . ......................................................',' . ..... . .:..............:..........................................:.:.....:.: :.::::::::::::::.::::::::::::::::::::::::::::::::::::::::::::.:::::.:. :::.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:::.:.:::: .:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::.: ::.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.::: ...................................................................... :.:::::.:.:::::::::::::::::::::::::::::::::::::::::::::::::::':::::':'. .......:.:.........................................................:.:. ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: .:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.'.:.:.:... ~~~~~~~~~~~;~~~~;;~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~;;~~~;~~~~~~~~~~~~~~ :::::::::::::::::::::::~:::~:::~:::::::::::::::::::::::::::::::~::::::: ............ .'. . . . .'. . . . . ...................... . 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T.O.P.A. EXHIBIT "A" w :::) :z w > < 191 z o ... e" Z - :x: en < ;: 18-1 XXX 1. XXX 2. XXX 3. XXX 4. XXX 5. INSURANCE REOUIREMENTS Workers' Compensation and Employer's Liability per the Statutory limits of the state of Florida. Commercial General Liability ( occurrence form), limits of liability $1,000,000.00 per occurrence for bodily injury property damage to include Premises/ Operations; Products and Completed Operations; Independent Contractors; Broad Form Property Damage Endorsement and Contractual Liability (Hold harmless endorsement exactly as written in "insurance requirements" of specifications). Automobile Liability - $1,000,000.00 - $50,000.00 each occurrence -owned/non- owned/hired automobiles included. Excess Liability - Umbrella policy of$5,000,000.00. The City must be named as and additional insured on the liability policies; and it must be stated on the certificate. XXX 6. Other Insurance as indicated: XX Personal Advertising Liability $1,000,000.00 XX Liquor Liability $1,000.000.00 XX Employee Dishonesty Bond $ 500,000.00 XXX 7. Thirty (30) days written cancellation notice required. XXX 8. Best's guide rating B+:VI or better, latest edition. XXX 9. The certificate must state the bid number and title EXHIBIT B .. .. EXHIBIT "B" MINIMUM OPERATING AND MAINTENANCE STANDARDS PERSONNEL --------- ~. contractor shall recruit and, at all times, employ a general manager and administrative and accounting personnel to be responsible for the overall management and operation of the Center and the Theater. 2. contractor shall recruit and, at all times, employ adequate personnel to maintain the following functions:" general security; janitorial, housekeeping and cleaning for both event and nonevent cleanup; landscaping services; electrical systems; plumbing; air conditioner operation; painting and general overall continuous maintenance of the Center and Theater to assure that the facilities are clean and operational at a~l times. 3. contractor shall recruit and, at all times,' employ personnel to stage and coordinate events to assure that all events occur with minimal delays and interruptions to the users. 4. Contractor shall recruit and, at all times, employ personnel to develop, place, circulate and implement a sales and marketing program for the Center not in conflict. with the booking policy and the Theater for a Summer Season. 5. Contractor shall recruit and, at all times, employ, either. on a temporary or permanent basis, all special staffing as requested by the users of the Center. 6. Contractor shall recruit and, at all times, employ necessary supervisors for all employees to assure that a high standard of personnel productivity is maintained. . 7. contractor shall recruit and, at all times, employ individuals ir accordance with an affirmative action policy. Such policy i~ required to be established in writing and approved by the City of Miami Beach. 8. Personnel employed shall reflect personal cleanliness, shall bE courteous at all times and shall not use improper language or ac1 in a loud or boisterous manner. 9. contractor shall provide for a progressive disciplinary policy fo: all employees who do not act in a courtesy manner, are no productive and who do not habitually practice the highest standard of ~leanliness and service to the users of the Center and Theater. EXHIBIT "e" PAGE 1 OF 3 . GENERAL SECURITY ---------------- 1. Contractor shall recruit. and, at all times, employ a securit, manager to provide for the overall security of the Center and th; Theater. 2. Contractor shall recruit and, at all times, employ, or providE through a contractual service, personnel to ensure the saVE guarding of, all city assets during non event hours. This functiol shail at a minimum include night watchmen for both the Center anc the Theater. JANITORIAL, CLEANING AND HOUSEKEEPING ------------------------------------- 1. The Center and the Theater shall be clean at all times. Thi~ includes general cleaning. during nonevent times as well as durinc events. 2. Restrooms are to be cleaned continuously during events and on ( periodic basis during nonevent times to assure that they are in ( functional and sanitary condition at all times. Soaps, towel an< toliet paper shall be provided,in adequate quantity at all times. 3. Garbage and trash shall be removed on a continuous basis durin( events and on an as needed basis during nonevent times. Removal 0: garbage and trash will be at the operator's expense. Special carl to insure minimal problems from refuse odor shall be taken. Trasl receptacles shall be conveniently stationed throughout thl facilties to insure a clean and sanitary appearance at all times. 4. Carpet shall appear clean at all times. Carpets shall be vacuume< on an as needed basis, daily during event. times. stains should bl cleaned when reported. Cleaning of the carpets shall occur on ( quarterly basis, more often should the need exist.' 5. Terrazzo floorjng and the exhibition hall flooring shall be clea: and polished at all times. Spills or other conditions whicl present a hazard to patrons shall be. adequately marked and cleane, immediately. 6. Windows shall appear clean at all times. windows shall be cleane a minimum of once a month, more often should the need exist. 7. Walls shall appear clean at all times. Marks during events shal be removed after the event either by washing or painting prior t EXHIBIT C PAGE 2 OF 3 . " the next event. 8. Extermination for all pests and occur on a monthly basis, more discovered. rodents (except termites) shall often shall evidence of pest be 9. Entrance doors and mirrors shall appear clean at all times. Cleaning of these should be done at a minimum of once a month, more often should the need exist. LANDSCAPING ----------- 1. Indoor landscaping should be watered as the type of plant demands. Dry plant areas shall be allowed to become completely dry before watering and then water is to be applied as thorough' drench. Moist plant areas are to be kept uniformly moist and the shall never become completely dry except for a short time period. Wet plant areas are to be kept constantly at field only by drenching., 2. Indoor landscaping shall be fertilized on a monthly basis. Over one year's time, approximately 3 pounds of pure nitrogen per 1,000 square feet of planted area should be applied. Fertilizer must be odor free and must not touch plant edges. It should be washed into the soil immediately. . ' 3. Indoor landscaping should be insect free. Constant examination of all plant material must be conducted. 4. Indoor landscaping should be dust 'free at all times. .5. The grounds surrounding maintained in a healthy, throughout the year. the Center and the growing, clean and Theater shall be attractive condition EQUIPMENT MAINTENANCE 1. Equipment shall be maintained in the full force and effect of all dealer's and manufacturer's warranties adn guarnantees available. 2. Equipment shall be maintained to eliminate all disruptive equipment failures~enhance operation of day to day business activities. 3. Each piece of manufacturers will be given equipment shall be maintained in accordance recommended mainten~nce schedules, copies to the successful proposer. with the of which EXHIBIT .Co PAGE 3 OF 3 MIAMI BEACH CONVENTION CENTER MIAMI BEACH, FLORIDA BOOKING POLICIES I. STATEMENT OF PURPOSE: The Miami Beach Convention Center (the "MBCC" or the "Center") is a national and international convention, tradeshow, and multi-purpose facility owned by the City of Miami Beach and operated by SMG. The facility was enlarged and remodeled with Convention Development Tax proceeds with the primary objective of promoting and facilitating events and activities which have a significant impact in terms of Convention Development Tax generated. -- In addition, the facility was developed with a secondary objective of providing services and facilities to respond to the needs of county and local activities which promote business and generally enhance the quality of life for the community the facility serves. Reservations more than twenty-four (24) months before the event are normally handled through the Greater Miami Convention and Visitors Bureau (the "Bureau"), subject to approval of the MBCC, and are subject to the guidelines of II (a) below. When booking the MBCC, consideration shall be given by both the Bureau and the Convention Center management to the following factors: a) Significant impact in terms of Convention Development Tax generated; b) Total number of hotel rooms required; c) Projected revenue to the facility both in terms of direct space rental revenue, as well as projected revenue from concessions and other building servIces; d) Time of year; e) Potential for repeat booking; and f) Previous history and experience of the potential user with respect to use of similar facilities. 1 .. .. EXHIBIT "D" ll. SCHEDULING PRIORITIES: A. First Priority Events. Generally speaking, first priority for scheduling facilities and date in the MBCC is available to regional, national and international conventions, trade shows, cultural shows, corporate meetings and similar activities which are not open only to the general public, have a significant impact in terms of Convention Development Tax generated, require in excess of 115,000 gross square feet of exhibit space in the MBCC and also require either a minimum of three nights with 1500 hotel rooms on the peak night in Miami-Dade County, or be a long standing show with a minimum of 20 consecutive years usage in the MBCC provided that the impact of the Convention Development Tax generated shall still apply as referenced in Section II. A. Convention Development Tax impact and hotel room counts are based on prior history of the event and are subject to verification by (1) the Bureau, or (2) at user's expense, a qualified independent surveyor pre-approved by the Convention Center Advisory Board, provided that such surveyor's results shall be subject to review and approval by the Convention Center Advisory Board. Facility and space scheduling commitments, i.e., reservations for First Priority Ev~ms, may be made as far in advance as is necessary or appropriate and may supersede requests for other events and activities, unless a lease agreement has been previously executed by the MBCC and the user for such other event. Lease agreements for First Priority Events may be entered into as far in advance as necessary or appropriate at the discretion of the General Manager of the MBCC (the "General Manager"). Within the First Priority category, the Bureau will give preference to the event with the most significant impact in terms of Convention Development Tax generated. B. Second P..iority Events: Second priority for scheduling facilities and dates in the MBCC is available to consumer or public exhibitions, tradeshows (open to the trade only), local corporate meetings, special events, entertainment events, business meetings, and other activities which essentially draw from or appeal to the general public and/or local regional attendees and participants. Tentative facility and date scheduling reservations for Second Priority Events are generally made not more than three years in advance, and are subject to change to accommodate First Priority Events, unless a lease agreement has been previously executed by the MBCC and user for such event. However, large consumer and public exhibitions and trade shows held on an annual basis may, at the discretion of the General Manager, obtain tentative scheduling reservations for facilities and dates on a long-term basis, subject to rescheduling or termination to accommodate First Priority Events. Lease agreements for Second Priority Events, shall, upon request of the party holding the reservation, be issued twenty-four (24) months prior to the event. The lease agreement shall provide that if the Bureau has a potential First Priority Event seeking to lease the facility during Lessee's contracted dates, and within the fifteen to twenty-four month period prior the Lessee's event, the Lessee shall agree to use its best efforts to move its event a few days either way 2 in order to accommodate the First Priority Event. Within the Second Priority category, the MBCC will give preference to long-standing public shows and tradeshows held on an annual basis with a proven record of success at the MBCC, which have produced significant revenue to the MBCC and have a significant impact in terms of Convention Development Tax generated (Convention Development Tax impact data shall be provided by the user), and may offer alternate dates in a given year which may result in termination of other second priority scheduling reservations~ the foregoing criteria may also be used by the MBCC to reschedule or select between Second Priority Events in the case where a scheduling reservation for a First Priority Event impacts tentative scheduling reservations for two or more Second Priority Events. Subject to the priorities set forth above, the General Manager may exercise his discretion as to the issuance, modification, or termination of scheduling reservations. m. PROTECTION CLAUSE: A Protection Clause shall, upon the recommendation of the Convention Center Advisory Board, be granted to long standing recurring local, regional, and international public and tradeshows with a proven record of success, and which have produced significant revenue to the MBCC. If granted, such Protection Clause will be included in the lease agreement, which will not be issued earlier than twenty-four (24) months prior to the event. The Protection Period shall not exceed a total of sixty (60) days, plus the show days. The number of days prior to and after the event shall be the subject of agreement between the Lessee and the General Manager, but a minimum of fifteen (15) days shall be required on each side of the event. Upon the recommendation of the Convention Center Advisory Board, a Protection Clause in excess of sixty (60) days may be granted for highly competitive events with highly significant revenue to the MBCC. If a Protection Clause is granted, it will read as follows: PROTECTION CLAUSE: Lessor agrees that it will not lease any portion of the Convention Center facility to any Competing Event for the period commencing days before Lessee's first show day, and concluding days after Lessee's last show day (the "Protection Period"). A "Competing Event" is hereby defined as an event which has thirty percent (30%) or more of the total number of exhibitors/booths in the same event showing/selling product lines in the Lessee's event~ provided, however, that a show that is open to the public shall never be deemed a Competing Event with a show open only to the trade, and vice versa. The determination of whether or not an event is a "Competing Event" shall be solely within the discretion of the General Manager, and shall be based upon the product lines in the proposed event's prior shows. 3 IV. DEFlNITION OF TERMINOLOGY: TENTATIVE: Facilities and dates will be temporarily held pending notification to the contrary by either party. In the event a tentative commitment is released by the :MBCC, the requesting party will be notified the facilities and/or dates have been released. SECOND OPTION: Facilities and dates will be reserved tentatively, but the tentative reservation will be contingent upon the release of a prior reservation which is considered first option. FlRST OPTION: Facilities and dates reserved on First Option are reserved tentatively, but a conflicting commitment for the facilities and dates generally will not be made in favor of a second requesting party within the same scheduling priority without first offering the party... holding a First Option an opportunity to either execute a lease agreement or release its reservation. A First Option held by a Second Priority Event can always be superseded by a First Priority Event, unless a lease agreement has been previously executed. At the discretion of the General Manager, a party with a First Priority Event holding a First Option may be required, within seven (7) days of written notice, to execute a lease agreement and post a deposit at any time that the General Manager has a good faith request in writing from another First Priority Event for the same dates. CONFIRMED: Facilities and dates are considered as confirmed or under contractual commitment only upon execution ofa :MBCC lease agreement by the event sponsor and the City of Miami Beach specifying all details of the commitment. However, facilities and dates may be held as "firm" upon receipt of a letter of confirmation signed by both the event sponsor and the General Manager, pending the preparation of a lease agreement. In the event such a letter of confirmation is signed by both the sponsor and the General Manager, no conflicting scheduling will be made during a reasonable period to permit preparation and execution of a lease agreement. LONG STANDING: Long standing show is defined as one which has a minimum of 20 consecutive years usage in :MBCC under the same ownership, is in good standing, which includes being current on all prior debts, and has paid all contractual obligations in a timely fashion to the facility. If the show has multiple events in :MBCC in a calendar year, the first priority designation applies to only one of the show events in the calendar year. 4 HOTEL ROOMS ON PEAK NIGHT: One of the criteria used for determining whether an event is a First Priority Event is 1,500 "hotel rooms on peak night" in Miami-Dade County. "Hotel rooms on peak night" should be distinguished from "total room nights" used, which is the product of the number of hotel rooms used times the number of nights the event is booked in hotels. No variance from the Center's agreement represented in the above terms may be made in any case except upon the prior express written approval of the General Manager. v. DEPOSIT SCHEDULES: Deposits are required for all activities upon execution of a formal MBCC lease agreement. FIRST PRIORITY EVENTS: A deposit in the amount of one day's minimum guaranteed rental per hall, or such other deposit as the General Manager may authorize, is required upon__.. execution of the lease agreement. For events leased several years or more in advance, special arrangements may be negotiated, at the Center's option, for a lesser deposit upon lease execution, with the deposit balance due and payable sixty (60) days in advance of the event. SECOND l)RIORITY EVENTS: A minimum deposit will be required upon execution of the lease agreement as follows: one day's minimum guaranteed rental for the first hall, and an additional 33-1/3% of one day's minimum guaranteed rental for each additional hall. However, first-time events without a past history of success, and event sponsors with inadequate references, or prior event sponsorships, a record of slow payment, etc., may be required, at the Center's option, to remit up to one hundred percent (100%) of anticipated rental and related expenses upon execution of lease agreement. Events and circumstances not covered in the above scheduling policies may be subject to special conditions as deemed appropriate by the General Manager. DWT:gm 120789 Rev. 060890 Rev. 070892 Rev. 060398 Rev. f:\convcntr\gina \bkgpot. 9 8 ~ 5 THE JACKIE GLEASON THEATER BOOKING POLICY I. Statement of Purpose The Jackie Gleason Theater (JGT) is a regional multi-purpose theater owned by the City of Miami Beach and operated by SMG. The facility was redesigned and remodeled in 1990 with the proceeds of a $22 million bond issue. The City of Miami Beach is committed to operating the venue according to policies which will: . Produce the highest possible income and operate the theater in a fiscally responsible manner. . Encourage artistic events that interest the entire community, which include, but are not limited to, Broadway shows, symphony presentations, ballet, opera, popular presentations and revues, etc. . Make the JGT available to as many producers as possible so as to maximize the number of days during which events are held . Contribute to the image of Miami Beach as a cultural destination and support the above policies by developing and implementing a strong marketing plan using the new image of the theater as a cornerstone of this effort. . Assist programs from small, local community arts groups and educational institutions by offering incentives. II. Definition of Event Classifications Presenters using the facility shall be classified within the following priorities: First Priority - Users who contract to present at least twenty performances over at least four separate events in a subscription series each year for more than one year Second Priority - Users who contract to present at least twenty performances over at least four separate events in a subscription series in one year Third Priority - Users who contract to present at least four performances of a single event OR users who contract to present at least one performance each of at least four separate events in one year 3 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) Fourth Priority - Users who contract to present at least one performance of at least one event Within each category, determination of priority shall be made by amount of proposed rental income returned to the facility. Notwithstanding the above classifications, any tentative hold may be challenged outside of twelve (12) months by the following: 1. Theater usage in conjunction with a first priority event at the Miami Beach Convention Center, such priority as defined in the Miami Beach Convention Center Booking Policy 2. Theater usage by a major blockbuster event engagement, defined as any event presenting at least twenty four (24) total performances over four consecutive weeks, with additional weeks issued at the discretion ofthe General Manager, If such booking challenges a hold by either a first or second priority user, and the challenged event fails to respond by contracting and providing the required deposit within forty-eight (48) hours of notification of challenge, upon assignment of the dates to the blockbuster event, the presenter of the blockbuster event will execute a contract within forty-eight (48) hours of notification and be responsible for the full rental as outlined in the contract. Any deposit from the displaced presenter currently held by the theater management may be refunded to the party who provided the deposit. At the discretion of the General Manager, established first priority users may be afforded revision of deposit requirements, III. Scheduling of Events Tentative date holds may be placed by users according to the following: First Priority - Dates may be placed on hold at any time in the future prior to the event Second Priority - Dates may be placed on hold at any time within the 18 months preceding the first performance of the series Third Priority - Dates may be placed on hold at any time within the 12 months preceding the first performance of the series 4 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) Fourth Priority -Dates may be placed on hold at any time within the 9 months preceding the first performance For any tentative booking, unless protected in the date challenge policy enumerated below, the booking hold will expire automatically after 30 days unless the presenter provides a non- refundable deposit in accordance with the following schedule: 1. F or a series of at least four events during a theater season - $1000 2. For an event with at least six performances during a theater season - $750 3. For a small community arts group or educational institution programs - $300 4. All other bookings - $500 The paid non-refundable deposit will entitle the presenter to an additional 60 days extension period. Any re-booking of the same date by the same presenter within 30 days of releasing said date shall be considered an extension and be subject to the required deposits as outlined in this section. Ifthe presenter enters into a contract prior to the expiration of the extension period, then the deposit will be applied to the contract. If the tentative date or dates are challenged and another party goes to contract within the extension period, then the deposit will be refunded to the presenter who paid the deposit. IV. Date Challenges Tentative, non-contracted date holds may be challenged, exclusive of challenges by blockbusters as outlined in Section II, by users according to the following: First Priority - Dates may be challenged at any time within 8 months prior to the desired challenge date Second Priority -.Dates may be challenged at any time after 30 days of being placed on hold provided the challenging event is within its date hold time frame Third Priority -Dates may be challenged at any time after being placed on hold provided the challenging event is within its date hold time frame 5 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) Fourth Priority -Dates may be challenged at anytime after being placed on hold Any tentative hold that has not gone to contract is subject to challenge in accordance with the following procedure: First and Second Priority - A presenter will be notified that a bona fide challenger has agreed to enter into contract and SMG is holding a deposit of 50% of the rent. The presenter with the tentative hold will have five (5) business days within which to enter into a contract with an appropriate deposit, or the date(s) will be given to the challenging party. Upon assignment of the dates, the challenging party will execute a contract and be responsible for the full rental as outlined in the contract. If the dates are given to the challenging party, any deposit currently held by the theater management will be refunded to the party who provided the deposit. Third and Fourth Priority - A presenter will be notified that a bona fide challenger has agreed to enter into contract and SMG is holding a deposit of 50% of the rent. The presenter with the tentative hold will have two (2) business days within which to enter into a contract with an appropriate deposit, or the date(s) will be given to the challenging party. Upon assignment of the dates, the challenging party will execute a contract and be responsible for the full rental as outlined in the contract. If the dates are given to the challenging party, any deposit currently held by the theater management will be refunded to the party who provided the deposit. v. Contract Deposits A) The minimum contract deposit required will be ~ of the base rental for all users. B) New clients will pay a contract deposit of full rent at the management's discretion, - C) Small community arts groups and educational organizations will pay as contract deposit the minimum rental. D) The remainder of the base rent is due two weeks prior to the event. 6 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) E) Producers with a series will be allowed to deposit the base rent for one performance, which will be credited to the final performance of the series, F) Deposits are non-refundable, Any producer who believes that its event was canceled due to exigent circumstances may request a partial or full return of the deposit, which is subject to the approval of the Convention Center Advisory Board. VI. Rental Rates A) Not-For-Profit, Section 501 ( C ) ( 3 ) organizations (as defined below) - $3,000 flat rent per performance. Flat daily rent for more than one performance per day is $4,650. Events with more than four performances per week are subject to negotiation with management. B) Commercial Organizations For 1-4 performances: $3,000 vs 12% of the gross ticket receipts per day for one performance per day $4,650 vs. 12% of the gross ticket receipts per day for multiple performance days For 5-10 performances: $3,000 vs 10% of the gross ticket receipts per day one performance per day $4,650 vs. 10% of the gross ticket receipts per day for multiple performance days For over 10 performances: $3,000 vs 8% of the gross ticket receipts per day for one performance per day $4,650 vs. 8% of the gross ticket receipts per day for multiple performance days All of the above are subject to a $4,800 per performance cap Events with more than four performances per week are subject to negotiation with management. 7 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) VII. Community Arts and Educational Programs, Small local community arts groups and educational institutions (as defined below) - will be offered use of the facility, when available, between the hours of9:00 A.M. - 5:00 PM at a discounted rate of$1.00/seat - minimum rental- $600, with a cap of $1,000 plus front of the house and back of the house expenses. These groups may be eligible to apply for a subsidy for a portion ofthe expenses from the appropriate City sources or other granting agencies. VIII. Definitions A) "Not-For-Profit, Section 501 ( C ) ( 3 ) Organizations" are defined as organizations which meet all of the following qualifications: 1) Current exemption letter from the IRS. 2) Current state certificate of incorporation and good standing. B) "Small local community arts groups" are defined as organizations which meet all of the following qualifications: 1) Annual cash budget under $500,000 2) A year-round presence in Dade County 3) A track record demonstrating successful presentation of cultural and/or educational programs. C) "Educational institutions" are defined as organizations meeting the definition set forth in Florida Statutes, Section 212.08 ( 7 ) ( 0 ) ( 2 )d, as amended from time to time. ,. D) A "Commercial organization" is defined as any organization which does not qualify as A), B) or C) above. 8 (JACKIE GLEASON THEATER BOOKING POLICY CONTINUED) IX. General Manager's Discretion The purpose of the booking policy o.fthe Jackie Gleason Theater is to provide the management with general guidelines for the efficient operation of the facility. Nothing contained within those guidelines is intended to limit the General Manager's discretion in the booking or negotiation of contracts that in his or her professional judgement would be in the best interest of the Jackie Gleason Theater and the City of Miami Beach, 9 Sec. 2.7 CONVENTION CENTER ADVISORY BOARD Sec. 2.7.1 There is hereby established the Convention Center Advisory Board whose purposes, power and duties, composition, membership qua!ification and general governing regulations are as follows. Sec. 2.7.2 PURPOSE: The mission of the board is to act in an advisory capacity to the City Commission on matters regarding operation of the Convention Center, to insure that highest quality in management and operation by the management . group of both the Miami Beach Convention Center and Jackie Gleason Theater of the Perfo'rming Arts; to monitor and consult on the relationship of the Greater Miami and the Beaches Convention and Visitors Bureau with the Miami Beach Convention Center; and to insure the highest quality of maintenance of the facilities. Sec. 2.7.3 POWERS AND DUTIES: a) To review, consult and advise on rates at both facilities; b) To advise and give input on budget; I c) To main~ an ongoing relationship between the board and the City; d) To review the marketing plan of the management group; e) To monitor the booking policies and approve any recommended changes by the management group; f) To advise and consult, review and recommend on multi-year contracts; g) To review and monitor management and user contracts and agreements; h) To review on a quarterly basis the maintenance of the buildings. i) To assume the powers and duties of the Community Benefit Committee for the Perfonning Arts, as follows: Advise and recommend to the City COmmission the most efficient allocation of the City of Miami Beach Endowment funds mentioned below for the purchase of two (2) tickets for the general performances and resale to senior citizens and students residing in Miami Beach at discounts of fifty percent (50%) or more and to consider the presentation and promotion of performances, programs, shows, and entertainment for the benefit and enjoyment of the residents of the City ofMiarni Beach to be held at the Theater of the Performing Arts at reduced admission prices, or for free admission to senior citizens and students residing on Miami Beach. Sec. 2.7.4 COMPOSITION: Each member of the City Commission shall designate one person, which person shall be appointed by the City COmmission as a member of said Board, and the City Commission shall, in addition, elect four (4) additional persons by a majority vote. .. -. -". EXHIBIT "E" ;. ( there shall be eleven (11) voting members appointed by the City Commission at-large: · The Chairperson of the Board of Directors of the Miami Beach Chamber of Commerce or hislher designee shall serve as a voting ex-officio member. · The Chairperson of the Board of Directors of the Greater Miami and the Beaches Convention and Visitors Bureau or hislher designee shall serve as a voting ex-officio member. · Two (2) PromoterslUsers of the Jackie Gleason Theater of the Perfonning Arts. · One (1) PromoterlUser of the Miami Beach Convention Center. · One (I) Attorney. · One (I) Financial Advisor. · One (1) Hotelier. · One (1) individual representing the field of Advertising/Marketing. · One (1) individual representing the field of Public Relations. · One (1) citizen at-large. Administrative representatives from the management group, Greater Miami and the Beaches Convention and Visitors Bureau, and the City Manager's Office shall serve as non-voting ex-officio members. Sec. 2.7.5 KNOWLEDGE AND EXPERIENCE: See "Composition." SUPPORTING DEPARTMENT: Office of the City Manager. . . . . -.. AGREEMENT THIS AGREEMENT, made and entered into this cXAd day of ojuir 1997, by and betWeen SPECTACOR :MANAGEMENT GROUP, hereinafter called "OPERATOR", AND PTG FLORIDA, INe., a Florida corporation, hereinafter called "PRODUCER", WITNESSETH: OPERATOR manages, operates and maintains the Jackie Gleason Theater, on behalf of the City of Miami Beach, a Florida municipal corporation (the "City"), under rights granted by and obligations imposed under an Agreement between CITY and OPERA TOR. That the OPERA TOR grants unto the PRODUCER the use and occupancy of the Jackie Gleason Theater, upon the following terms and conditions. 1. OPERA TOR does hereby give and grant to the PRODUCER the non-exclusive right to present a Broadway subscription series consisting of touring Broadway-type dramatic and dramatic musical productions and concerts, whether or not such productions have a story line, at the Jackie Gleason Theater (hereinafter referred to as "JGT"), Miami Beach, Florida, commencing on July 1, 1998 and ending on June 30, 2002. A theatrical season begins on the fIrst day of October and ends the following thirtieth (30) day of May. 2. This contract is granted upon the following terms, conditions and covenants: a. PRODUCER covenants that, under the rights granted by this Agreement, a minimum thirty (30) days per season (each season defined as October I-May 31) with at least one performance per day, consisting of at least four separate events, shall be presented in each theatrical season. b. The extent, date and time of each performance shall be presented by the PRODUCER to the designated representative of the Jackie Gleason Theater and all dates are to be tentatively held subject to the Jackie Gleason Theater Booking Policy as revised and adopted in June 1997. All date holds shall be confirmed in writing but may be changed subject to availability or canceled by the PRODUCER All dates reserved and not canceled by April 1 for October through December dates of the subsequent season, or June 1 for January through May dates of the subsequent season, with written notice from the PRODUCER shall be charged to the PRODUCER at the rate of $500 per day unless the OPERA TOR shall obtain another lessee for those dates or any part thereof. PRODUCER shall promptly and punctually pay the penalty set forth in this section and in all cases will pay the penalty within thirty (30) days of its being due. PRODUCER maintains the right to block out two (2) weeks per month during the theatrical season, with a maximum hold of ten (10) weeks. However, this shall not preclude PRODUCER from obtaining additional weeks within said month subject to availability and OPERA TOR approval. c. The base rental per performance day at the Jackie Gleason Theater will be ~ follows: 1998-99 $3,000 per performance day 1999-2000 $3,166 per performance day 2000-01 $3,250 per performance day 2001-02 $3,333 per performance day PRODUCER shall receive one free move-in day per event. In addition to the above base rental, the PRODUCER shall pay at settlement to the OPERA TOR a rent equal to five percent (5%) of gross weekly ticket sales in excess of$500,000, such gross sales defined as net of applicable gross receipts taxes and surcharges. This additional rent shall not apply to blockbuster events as defmed in the Jackie Gleason Theater Booking Policy. For purposes of this contract, a week shall be defIned as the period of time consisting of Monday through Sunday during which there are a minimum of six (6) performances of a show. When the theater is being rented on a weekly basis the PRODUCER will pay the OPERA TOR ... -. EXHIBIT "F" $1,250 for an eighth day for move-in and $2,000 per day for the ninth and subsequent move-in days. OPERA TOR is required to provide the PRODUCER with air conditioning only during theatrical performances (show time) and not during rehearsals and move-ins. If requested for other than show times, air conditioning may be provided at the prevailing building rate. d. The OPERA TOR maintains the right to rent the theater to another lessee for portions of the same day on which PRODUCER is presenting a show provided that such rental will not materially interfere with the production of the PRODUCER'S show and will not result in the PRODUCER incurring additional cost. e. The PRODUCER shall pay to the OPERA TOR the sum of Three thousand dollars ($3000) for each and every day less than the minimum thirty (30) day requirement in paragraph 3c as liquidated damages and not as a penalty. f. The PRODUCER shall furnish to the OPERA TOR twenty (20) top price promotional tickets for the opening night of each show, and ten (10) top price promotional tickets for each additional performance thereafter. g. PRODUCER agrees to cooperate with OPERA TOR and the CITY in joint marketing efforts for the facility. In addition to cooperation, PRODUCER agrees to contribute Twenty-five thousand dollars ($25,000) annually to the OPERATOR on the condition that such amount be matched from the CITY or other sources for the purpose of funding such facility marketing efforts. Disbursement of said monies shall be at the mutual agreement of PRODUCER, OPERA TOR, and CITY 3. Technicians, stage hands, and other personnel as needed may be employed by the PRODUCER and shall be considered, for the purpose of this Agreement, the employees of the PRODUCER, and the PRODUCER shall be responsible for the payments of Wages, Workers' Compensation, Unemployment Insurance, Social Security and Withholding Taxes. The OPERA TOR reserves the right during the period of this contract to employ its own ticket takers, and ticket sellers, ushers and other personnel, as needed in place of PRODUCER'S employees with the exception of ticket telephone sales and subscription sales. In the event the OPERATOR employs ticket takers, ticket sellers, ushers and other personnel as needed the PRODUCER agrees to pay the OPERA TOR for such services. PRODUCER agrees to pay for all preliminary and run of show box office labor at the rate of$2000 per show week, plus applicable credit card administration fees. It is agreed that PRODUCER will provide will-call staff outside of this fee. Additionally, this fee shall be prorated as applicable to performance weeks containing fewer than 8 performances. 4. The OPERATOR shall also furnish at its expense janitorial services and. supplies, house lights, all lighting available in the Jackie Gleason Theater and lighting equipment, and all available Jackie Gleason Theater sound equipment and systems. 5. The PRODUCER agrees to procure and maintain in effect, at his own expense, for each period of time during which he shall have the right to possession of the said premises and facilities w'1'der the terms and provisions of this Agreement, commercial general liability insurance, on an occurrence form, in the amount of $1,000,000 per occurrence for bodily injury, death, property damage and personal injury. The policy must include coverage for premises operations, blanket contractual liability (to cover the indemnification provision) products liability and completed operations and independent contractors. PRODUCER shall also provide automobile liability insurance in the amount of One Million ($1,000,000.00) Dollars per occurrence to provide coverage for any o\'med and non-owned vehicles used by the PRODUCER on the Facility premises, including loading and unloading hazards, which must name the City of Miami Beach and OPERA TOR as additional insureds. PRODUCER agrees to hold harmless, save, insure, protect, defend and indemnify the OPERA TOR and the CITY OF MIAMI BEACH and its officials and employees from any and all suits, causes of action, claims, obligations, demands, damages or liability which may arise from or accrue by reason of the possession and use of the said premises and facilities by the PRODUCER. The insurance policies so provided shall contain 2 provisions that the OPERA TOR Insurance Manager shall receive not less than five days prior written notice of any change, modification, alteration or cancellation of said insurance. Said policy shall be subject to the approval of the City of Miami Beach and OPERA TOR'S Insurance Managers, and shall be submitted by the PRODUCER not less than five days prior to the date of the first presentation under the provisions of this Agreement. The insurance required hereunder shall be furnished by insurance companies rated A:X or better according the A.M. Best's Key Rating Guide (latest edition) and who are duly authorized to do business in Florida. 6. The PRODUCER further agrees: a. That all concessions or other rights and privileges as to the serving or dispensing of food, beverages, candy and tobacco or any other article sold or offered for sale dispensed or served to the public, excluding the distribution of free programs in or about the premises are retained by the OPERATOR. b. The said PRODUCER will not vend, sell, serve or otherwise dispense beer, wine or liquors, nor any other item conflicting with the rights of the concessionaire upon said premises. 7. The PRODUCER further agrees to deposit with the OPERA TOR upon the execution and delivery of this instrument, Two Thousand Five Hundred Dollars ($2,500.00) which deposit shall be deemed a guarantee and which deposit will be held by the OPERA TOR and may be applied to any rentals canceled without proper notice to the OPERA TOR or other obligations or PRODUCER 8. Payments to be made to the CITY by the PRODUCER shall be made as follows: a. The basic rental payment as set forth herein or adjustment thereof shall be paid for the entire run of each show on or before move in day for each show. b. All other charges shall be paid on or before move out day provided such amount is not available to OPERA TOR through box office receipts for each show. c. Unless exempted, this Agreement is subject to the State of Florida sales tax, which is currently 6.5%, and the PRODUCER shall pay the same. 9. PRODUCER further agrees to furnish the OPERA TOR attendance totals and any reasonable additional bad...-up material necessary for the OPERA TOR internal auditor to verify such attendance totals. 10. This Agreement may be modified from time to time by mutual agreement of the parties, which said agreement shall be reduced to writing and executed by the parties. Said modifications may be treated as an amendment to or a supplement to this Agreement. 11. PRODUCER shall collect for the CITY One Dollar ($1.00) per ticket sold for the Community Benefit Committee for the Perfonning Arts, or any such entity which may succeed said committee in administration of the surcharge, in accordance with Resolution Nos. 83-17447 and 84-1.7882, and remit to the City $1.00 per ticket sold and furnish box office statements to Producer for each perfonnance. Surcharge is not considered rent. 12. OPERA TOR and PRODUCER hereby acknowledge and confirm that the Broadway Series throughout Florida is presented by the Florida Theatrical Association, a Federal and State not-fOr..profit 50 1(C)3 Organization in association with PRODUCER. Florida Theatrical Association sponsors and presents the Broadway Series and has an Agreement with PRODUCER to implement the series and OPERA TOR hereby consents to the same. 13. ASSIGNMENT AND SUBLETTING: PRODUCER shall not assign, transfer, or sublet this Agreement or its right, title or interest therein without OPERA TOR'S prior written approval, except as provided above. 14. INTENTIONALL Y OMITTED. 15. PREMISES AND EQUIPMENT: a. This Agreement grants unto the PRODUCER the full use of stage, existing stage setting, stage properties, stage lights, dressing rooms, "green room", orchestra pit, orchestra, mezzanine and balcony seats, lobby, gaileX)' and entry ways. The PRODUCER shall take the premises as they are at the time of occupancy by 3 the PRODUCER In the event the PRODUCER finds it necessary to remove or change the location of any stage rigging, settings, curtain or equipment, the changes shall be made by the PRODUCER at the PRODUCER'S expenses; provided, however, that no removals or changes shall be made without prior written consent of the Theater Director. PRODUCER further agrees to replace and restore all said stage riggings, settings, curtains or equipment to the former location and condition in which the PRODUCER found them. b. PRODUCER agrees to pay costs of repair and replacement and all damages of whatever origin or nature which may occur during the term of this Agreement in order to restore the leased premises or other parts of the OPERATOR'S premises affected by the event to a condition equal to that at the time this Agreement became effective. In the event the PRODUCER shall fully and faithfully comply with all of the terms, covenants, provisions, and conditions of this Lease, said security deposit shall be set off against any rent owed to the OPERA TOR at the tennination of the Lease. In the event of any bankruptcy or other insolvency proceeding again PRODUCER, it is agreed that all security deposits held hereunder shall be deemed to be applied by OPERA TOR to rent, sales ta.x and other charges andlor penalties due at date of bankruptcy andlor insolvency. c. PRODUCER shall not injure, mar, or in any manner deface the premises or any equipment contained therein and shall not cause or permit anything to be done whereby the said premises or equipment therein shall be in any manner injured, marred or defaced. PRODUCER further agrees it will not tape items, drive or permit to be driven nails, hooks, tracks, or screws into any part of said building or equipment contained therein and will not make or allow to be made any alterations of any kind to said building or equipment contained therein. PRODUCER further agrees that if any alterations are made to accommodate productions, PRODUCER will restore facility to same condition as when they took occupancy at PRODUCER expense. 16. REHEARSAL HALL: Unless otherwise specified in this Agreement, the rehearsal hall is not included in the leased premises nor is rent for the rehearsal hall included in the amount of rent payable for the leased premises. The rehearsal hall is subject to additional rent charges. The rehearsal hall will not however, be subject to additional rent charges if used by PRODUCER during run of show. 17. ORDINANCES AND REGULATIONS: PRODUCER will comply with all laws, ordinances and regulations adopted or established by federal, state or local governmental agencies or bodies; and by all facility rules and regulations as provided by OPERA TOR, and PRODUCER will require that its agents and employees likewise comply. PRODUCER agrees that at all times it will conduct its activities with full regard for public safety and will observe and abide by all applicable regulations and requests by duly authorized governmental agencies responsible for public safety and by OPERA TOR to assure such safety. OPERATOR further agrees that all portions of sidewalks, entries, doors, passages, vestibules, halls, corridors, stairways, passageways, and all ways of access to public utilities of the premises shall be kept unobstructed by the PRODUCER and shall not be used for any purpose other than ingress or egress to and from the premises by PRODUCER PRODUCER also shall not use or store or permit to be used or stored in or on any part of the Leased premises any substances or thing prohibited by law, ordinance, or standard policies of fire insurance companies operating in the State of Florida, without the permission of the OPERA TOR)'llluminating oils, candles, oil lamps, turpentine, benzene, naphtha, or other similar substances or explosives of any kind shall not be placed in or on the licensed premises. It is further agreed that no inflammable materials, such as bunting, tissue paper, crepe paper, etc., will be permitted to be used as decorations and decorative materials unless they are treated with flame proofing and are approved by the appropriate inspector of the City of Miami Beach or Dade County, Florida, before the same are installed. 18. POWERS TO VACATE PREMISES: OPERATOR shall retain the right to cause interruption of any performance in the interest of public safety, and to likewise cause the termination of such performance when in the judgement of the OPERA TOR such action is necessary in the interest of public safety. Should it become necessary in the judgement of the OPERATOR to evacuate the premises because ofa bomb threat or for other reasons of public safety, the PRODUCER will retain possession of the premises, for sufficient time to complete presentation of its activity without additional rental change. If it is not possible to complete 4 presentation of the activity, rental shall be prorated, and the PRODUCER hereby waives any claim for damages or compensation from the OPERA TOR. OPERA TOR reserves the right to make such announcements as are deemed necessary at any time in the interest of public safety. PRODUCER agrees that it will cooperate with the delivery of such announcements for public safety, including but not limited to, announcements to require patrons to leave their seats or to leave the premises. The OPERA TOR reserves the right to eject or cause to be ejected from the premises any person or persons causing a disturbance, and neither the OPERA TOR nor any of its officers, agents or employees shall be liable to the PRODUCER for any damages that may be sustained by the PRODUCER through the exercise by the OPERA TOR of such right. 19. DEFAULT AND OPERATOR'S REMEDIES: Default shall be defmed as the untimely performance of any and all clauses in this Lease. OPERA TOR may exercise any or all remedies enumerated or permitted by law. OPERA TOR may hold a landlord's lien on any and all personalty when PRODUCER is in default and PRODUCER expressly gives OPERA TOR permission to remove and store at PRODUCER'S expense, any personalty abandoned on the demised premises. The PRODUCER shall pay upon demand all OPERA TOR'S expenses and costs incurred in enforcing the PRODUCER'S obligations under this lease including but not limited to: legal costs, charges and/or expenses, includingrreasonable attorneys' fees incurred by OPERATOR in any pre-litigation negotiation, litigation and/or appeal in which the PRODUCER causes the OPERATOR to become involved or concerned. OPERA TOR may resort to anyone or more of such remedies or rights, and adoption of one or more such remedies or rights, shall not necessarily prevent the enforcement of other remedies or rights concWTently or thereafter. In the event of litigation, the prevailing party shall be entitled to reasonable attorneys' fees and costs (including paralegal, law clerk and legal research fees) at pre-trial, trial, administrative, bankruptcy and appellate levels. 20. RIGHT OF ENTRY: Any duly authorized agent or agents or employees of the OPERATOR shall have the right at any time to enter into any and all parts of the premises for the purpose of inspecting the same, making or causing to be made, necessary repairs thereto, enforcing all necessary and proper rules for the management and operation of the premises, and enforcing the PRODUCER'S obligations hereunder. 21. SUPPL Y OF KEYS TO OPERA TOR: The OPERATOR or his representative shall have available to him at all times, total and complete access to all portions of the leased premises. PRODUCER shall supply to the OPERA TOR, or his representative, a key or keys to any and all parts of the premises which PRODUCER desires to secure under lock, such keys and locks to be provided for and installed and removed at the sole expense of PRODUCER, subject to immediate removal upon termination of this Agreement, or otherwise at the discretion of the Director. In the event the Director determines it to be necessary to remove any locks which have been installed by PRODUCER, the Director may order such removal, the cost of which shall be borne by PRODUCER. 23. NO BOX OFFICE BAILMENT: In the handling, control, custody and keeping of receipts and funds, whether the same are received through the box office or otherwise, the OPERA TOR is acting for the accommodation and sole benefit of PRODUCER and that, as to such receipts and funds, the OPERA TOR shall be responsible only for gross neglect, bad faith or theft. 25. MISCELLANEOUS: a. All legal proceedings arising from this lease shall be in the courts situated in Dade County, Florida. b. If any section, subsection, clause or provision of this Lease is held invalid, the remainder shall not be affected by such invalidity. c. This Lease may only be altered, changed or amended, by an instrument in writing signed by both parties hereto. d. No waiver of any covenant or condition of this Lease by either party shall be deemed to imply or constitute a further waiver of the same covenant or condition or any other covenant or condition of this Lease. e. This Lease contains and embodies the entire Agreement of the parties hereto and no 5 representations, inducements or agreements oral or otherwise, between the parties not contained and embodied herein shall be of any force and effect. f. In any conflict between the Lease and other written provisions the Lease shall prevail. IN WITNESS WHEREOF, the parties hereto have caused these presence to be signed in this corporate names by their duly authorized officers, their corporate seal is to be affixed, and attested by their respective City Clerk and Secretary. By: Mayor APPROVED AS TO FORM & lANGUAGE & FOR EXECUTION 144 ~~ CItY omey C!r?-~9 7 Oaf " ~ 1tt:ORIDA. IN~ l~ \.Q1\ G~ It ; TTEST: /Jj , 1</2- t/t'Lt~WA ^-- ~ ORIDA THEA TRICAL ASSOCIATION '---f.!~ E. r/~ CYcC D/~ ) , ATTEST: . ~. ~:<' . 6 RESOLUTION NO. 97-22457 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAl\H BEACH, FLORIDA, APPROVING A CONTRACT BETWEEN PACE THEA TRICAL AND SPECTACOR MANAGEMENT GROUP, ON BEHALF OF THE CITY OF l\1IAMI BEACH, FOR THE PRESENTATION OF A BROADW A Y- TYPE ENTERTAINMENT SERIES THROUGH 2001-02 WHEREAS, the City of Miami Beach owns the Jackie Gleason Theater and is desirous of facilitating the continued presentation of high quality entertainment events at that venue; and \VHEREAS, the City has enjoyed the presentation of first-class Broadway entertainment at the Jackie Gleason Theater since 1975; and WHEREAS,the City Commission has voted to allow for an open booking policy as regard to the presentation of Broadway-type entertainment; and WHEREAS, Pace Theatrical Group, the preeminent producer of touring Broadway-type entertainment series in the United States has expressed a desire to continue presentation in the Jackie Gleason Theater; and \VHEREAS, Spectacor Management Group, management company for the Jackie Gleason Theater, has negotiated an Agreement with Pace Theatrical Group that would ensure the continued presentation of a first-class Broadway-type entertainment series at the Theater through the 2001-02 theatrical season; and WHEREAS, said Agreement is a fair and equitable understanding that is mutually beneficial to both Pace Theatrical Group and to the cultural and economic interests of the City of Miami Beach; NOW, THEREFORE BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby approve the Agreement between Pace Theatrical Group and Spectacor Management Group, on behalf of the City of Miami Beach for the non-exclusive presentation of a Broadway-type entertainment series at the Jackie Gleason Theater tough the 2001-02 theatrical season.. PASSED and ADOPTED this 2nd of ,1997. ATTEST: APPROVED AS TO FORM & lANGUAGE & FOR EXECUTlON jvLu.vr r~~ CITY CLERK 1!J~ ~/~j7 :;1 T Y OF MIAMI BEACH ;ITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 :ttp: \lei. miami-beach .tl.us COMMISSION MEMORANDUM NO.!::l f ~ -~ 1 TO: Mayor Seymour Gelber and Members of the City Co ission DATE: July 2, 1997 FROM: Jose Garcia-Pedrosa City Manager SUBJECT: RESOLUTION AP 0 ING A PROPOSED NON-EXCLUSIVE AGREEMENT BETWEEN PACE ATRICAL GROUP AND SPECTACOR MANAGEMENT GROUP, ON BEHALF OF CITY OF MIAMI BEACH, FOR THE PRESENTATION OF A BROADWAY-TYPE ENTERTAINMENT SERIES THROUGH 2001-2002 SEASON. ADMINISTRA nON RECOMMENDA nON: Approve the resolution and the proposed negotiated agreement. BACKGROUND: The Commission, in its action on May 7, 1997, voted to transition the Jackie Gleason Theater of the Performing Arts to an open booking policy for Broadway-type entertainment following the conclusion of the existing agreement with Pace Theatrical Group (PTG), which runs until June 30, 1998. Subsequently, Spectacor Management Group (SMG), management firm for the Jackie Gleason Theater of the Performing Arts, entered into negotiations with PTG for the non-exclusive presentation of a subscription series of Broadway-type entertainment at the Jackie Gleason Theater of the Performing Arts. PTG and its predecessors have presented this type of entertainment at the Jackie Gleason Theater of the Performing Arts since 1975 and desire to continue to present same through the 2001-2002 theatrical season. PTG wishes to have a contract to present performances because PTG wishes to have "First Priority" under the amended Booking Policy adopted by the City Commission on June 18, 1997. That Booking Policy requires that there be a contract for at least 20 performances over at least four years in order for a presenter to be given "First Priority". Normally, such a contract would be signed by the presenter with SMG, but SMG's management contract expires in approximately two years, and the City's approval of the four-year contract is therefore required. ), ANAL YSIS: Highlights of the proposed agreement (copy attached) include the following: Guarantee of a minimum of thirty (30) performance days (versus 48 currently), consisting of at least four separate events per theatrical season. Guaranteed minimum total rent payments of $90,000 for the 1998-99 season, $95,000 for the 1999-2000 season, $97,500 for the 2000-200 I season, and $100,000 for the 2001-2002 season. This rental, viewed weekly, equates to $18,000, $19,500, and $20,000 per week respectively, and compares to the current PTG rental rate of $17,000 per week for the 1997-1998 season. AGENDA ITEM~ i-2-l1l DATE 1 Additional rent payments of five percent of gross weekly ticket sales (net of taxes and surcharges) exceeding $500,000. A commitment to work with the City and SMG in developing joint marketing efforts, including a matching grant of $25,000 annually toward such marketing efforts to be expended for general promotion of the Theater outside the scope of the PTG events. Adherence to the Jackie Gleason Theater Booking Policy subsequent to approval of said policy with revisions in June 1997. In contrast to the existing agreement, the proposed agreement grants no exclusive rights to PTG in this presentation genre, and offers no date protection against similar events being booked into the Jackie Gleason Theater of the Performing Arts. Committee consideration by the Convention Center Advisory Board approved the proposed agreement at a special call meeting on June 23, 1997. The rental fees and contributions guaranteed to the City in this agreement total $482,500 over the four years. The agreement ensures the continuation of the presentation of first-class Broadway-type entertainment at the Jackie Gleason Theater of the Performing Arts through the 2001-2002 theatrical season. The rent structure is fair as compared to similar series, and the rental arrangement returns significantly more revenue per use day than the current agreement, even though exclusivity has been deleted. CONCLUSION: The approval of this agreement will allow PTG to be classified as a first priority presenter as defined in the amended booking policy, as approved by the Commission of June 18,1997. Additionally, the approval of this contract will increase the per day revenue in comparison to previous years and assure the continued presentation of Broadway-type entertainment at the Jackie Gleason Theater of the Performing Arts for the coming four theatrical seasons. JGP:~T:lcd Attachrrients F:\CMGR\$ALL\COM-MEM. 97\PTGBRDWY.AGM ) , 2