HomeMy WebLinkAboutAmendment 2 to Agmt with SMG
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AMENDMENT NO. 2 TO THE MANAGEMENT AGREEMENT BETWEEN THE CITY
OF MIAMI BEACH, FLORIDA, AND SMG FOR THE MIAMI BEACH CONVENTION
CENTER AND JACKIE GLEASON THEATER OF THE PERFORMING ARTS
(AGREEMENn, EXERCISING TWO (2) ONE YEAR RENEWAL OPTIONS,
COMMENCING ON OCTOBER 1, 2006, AND ENDING ON SEPTEMBER 30, 2008;
AND FURTHER AMENDING SECTION 4.3 OF THE AGREEMENT, ENTITLED
"INCENTIVE FEE", AND SECTION 12 ENTITILED, "TERMINATION."
This mendment No.2 to the Agreement, is made and entered into this 10 t4
day of , 2006, by and between the CITY OF MIAMI BEACH,
FLORIDA, a m icipal corporation having its principal office at 1700 Convention Center
Drive, Miami Beach, Florida, 33139 (City), and SMG, a Pennsylvania general
partnership whose current address is 701 Market Street, 4th Floor, Philadelphia, PA,
19106 (SMG).
RECITALS
WHEREAS, on October 15, 2003, the Mayor and City Commission approved
Resolution No. 2003-25381, authorizing the Mayor and City Clerk to execute a
Management Agreement (the Agreement) between the City and SMG for the
management, promotion, and operation of the Miami Beach Convention Center (the
Convention Center) and Jackie Gleason Theater of the Performing Arts (the Theater),
including, without limitation, all adjacent grounds, sidewalks, rights-of-way and
marshaling areas, but not including the adjacent parking lots (collectively, with the
Convention Center and Theater, the Facility) located in the City of Miami Beach, Florida;
and
WHEREAS, on July 28, 2004, the Mayor and City Commission approved
Amendment NO.1 to the Agreement by which the City elected to have SMG Operate,
manage and promote the following City facilities (the Additional Facilities):
a) Byron-Carlyle Theater, located at 500 71 st Street;
b) Colony Theater, located at 1040 Lincoln Road;
c) Little Stage Theater, located at 2100 Washington Avenue; and
WHEREAS, Section 3 of the Agreement, entitled "Management Term & Renewal
Term" provided for an initial term of three(3) years, commencing on October 1, 2003,
and terminating on September 30, 2006; and .
WHEREAS, the City has the option, at its discretion, to extend the Agreement
term for two (2) successive one (1) year terms (the Renewal Terms), by giving written
notice to SMG not less than ninety (90) days prior to the expiration of the initial term (or
an exercised Renewal Term); and
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WHEREAS, the Administration recommended, and the Mayor and City
Commission hereby approved said recommendation, to exercise both one (1) year
options, thereby providing for a total Renewal Term commencing on October 1, 2006,
and ending on September 30, 2008; and
WHEREAS, additionally, upon the City's approval of the Renewal Term (as
provided in this Amendment No.2), SMG shall also pay to the City its required Capital
Contribution, as required and in the amounts provided by the Agreement; and
WHEREAS, the Administration and SMG have also negotiated the following
amendment to Section 4.3 of the Agreement, entitled "Incentive Fee," modifying the
Incentive Fee Criteria; and
WHEREAS, the Administration and SMG have also negotiated an amendment to
Section 12 of the Agreement, entitled "Termination", providing the City with the ability to
terminate that portion of the Agreement pertaining to SMG's operation and management
of the Jackie Gleason Theater, without cause and at the City's sole option and
discretion, upon sixty (60) days prior written notice thereof to SMG; and
WHEREAS, in addition to the City's exercise of the Renewal Term, the
Administration would further recommend that the Mayor and City Commission approve
and authorize the Mayor and City Clerk to execute the following Amendment NO.2 to the
Agreement.
NOW, THEREFORE, in consideration of the mutual premises, covenants and
agreements herein contained, and other good and valuable consideration, in receipt and
adequacy of which are hereby acknowledged and intending to be legally bound, the City
and SMG hereby amend the Agreement as follows:
1.
reference herein.
The aforestated recitals are true and correct and incorporated by
2. The City hereby exercises its option under the Agreement, and
extends the Agreement, as amended, for both successive one (1) year Renewal Terms.
Accordingly, the total Renewal Term of this Agreement shall commence on October 1,
2006, and end on September 30, 2008.
3. Section 4.3 of the Agreement, entitled "Incentive Fee", subsection
(a) (i) thereof, entitled "Maintenance of Facility and Capital Eauipment", is amended as
follows:
(i) Maintenance of Facility and Capital Eauipment. The City
shall award SMG up to forty (40) percent twonty (20) 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 Facility (including the
comprehensive preventive maintenance program). Such evaluation shall take into
account the quarterly review of the City's Property Management Department and a
yearly review by an outside independent party.
4. Section 4.3 of the Agreement, entitled "Incentive Fee", subsection
(a) (ii) thereof, entitled "Financial Performance", is amended as follows:
(ii) Financial Performance. The City shall award SMG up to
thirty (30) percentage credits for a Fiscal Year based on the actual Net Operating
Loss/Profit for the Facility when compared to the Net Operating Loss/Profit for the
Facility reflected in the Approved Budget for the Fiscal Year in question based on the
table below, not taking into account (in either the actual or budgeted calculation of Net
Operating Loss/Profit) the internal service charges assessed by the City to the Facility
pursuant to the Approved Budgets which charges include, without limitation, property
insurance premium costs, sewer charges, and communication/information technology
charges.
Attainment of Net Operating Loss/Profit
reflected in Approved Budget
10 points
Improvement of 5% over Net Operating
Loss/Profit reflected in Approved Budget
16 ~ points
Improvement of 10% over Net Operating
Loss/Profit reflected in Approved Budget
23 3Q-points
Improvement of 15 % over Net Operatino
Loss/Profit reflected in Approved Budoet
30 points
5. Section 4.3 of the Agreement, entitled "Incentive Fee",
subsection (a) (iii) thereof, entitled "Customer Satisfaction", is amended as follows:
(iii) Customer Satisfaction. The City shall award SMG up to
fifteen (15) t'l.'enty (20) percentage credits for customer satisfaction based on customer
evaluations (the form of which shall be mutually agreed upon by both parties) and
thresholds to be mutually agreed upon in writing by both parties.
Customer surveys - SMG shall, with input and approval from the City,
develop a customer satisfaction research program from which incentive program
will be administered. Fifteen percentaae points will be evaluated usina the
followina criteria:
Completion of evaluations by clients: A total of six (6) percentage points
will be awarded based upon the percentaae of completed evaluations received of
all booked events that use the facility(jes) as detailed below:
65% completed
6 points
55% completed
4 points
45% completed
2 points
Less than 45%
o points.
Averaoe score of evaluations: A total of nine (9) percentaoe points will be
awarded based upon the averaoe score (6 points) and comparison to the prior
year of customer satisfaction in areas under the manaaement and control of
SMG (3 points). Score will be determined based upon overall positive (excellent
and aood) score. as well as year over year improvement.
Averaae Score
90%
6 points
80-89%
4 points
70-79%
2 points
Less than 70%
o points.
Customer Satisfaction
The City may award a maximum of three (3) points for comparison of
results to the prior year of customer satisfaction surveys. The score will be based upon
a comparison review of poor. fair. aood. and excellent scores from previous fiscal year
results.
Includod in tho City's o'.'::lluation pursuant to this subsection (iii) will bo SMG's
suporvision ::lnd monitoring of the food and bever3ge oper::ltions in tho F::lcility, attention
to qU3lity controls, lovols of sorvico ::lnd perform3nce st3nd3rds.
6. Section 4.3 of the Agreement, entitled "Incentive Fee", subsection
(a) (iv) thereof, entitled "Booking Events at the Facility", is deleted in its entirety and
replaced with the following new subsection (iv):
(jv) Monitorina Food and Beveraae - The City shall award SMG UP to
fifteen percent (15%) for supervision and monitorina of the food and beveraae
operations in the Facility. attention to auality controls. levels of service and performance
standards. Goals and obiectives to be used in monitorino for the evaluation will include:
. Annual Review of Menus & Pricina
· Annual Review of Staff Trainina Manuals and Procedures
· Review of Permanent Staffina Plan
· Review of Individual Event Operational Service Plans
. Review of Caterina Banauet Event Orders (B.E.O.)
· Attendance at all Client Tastinas
· Monthly Meetino with F&B Provider to Review Food and Beveraae
Operations
· Consultina with Meetina Planners as to F&B Plannina Prooress
· Onooina Review of Concession Food Quality and Service. providina
feedback to Provider
. On Site Contact with Meetina Planners reaardina F&B Issues
· On Site Review of Caterina Set-ups. providina feedback to Provider
· Post-Event Surveys Distributed with Results Discussed with Provider.
This Section will be reviewed by the parties on September. 30 2007 to determine if
further amendment to the Aoreement is necessary to more effectively monitor the food
and beveraae operations in order to maintain auality controls.
Bookina Events at tho Facility. Tho City shall ::l'l.'ard SMG up to twonty
(20) percont::lgo crodits for booking events ::It tho Facility based on tho
following table:
Convontion Centor up to 10 points
65 actual ovonts hold during a Fiscal YO::lr
or 18% Occup::lncy R::lte
2.5 points
70 actual evonts hold during a Fiscal YO::lr
or 52% Occupancy Rate
5 points
75 ::lctu::l1 ovonts hold during a Fiscal Year
or 56% Occupancy R::lto
7.5 points
80 actual events held during a Fiscal Year
or 60% Occupancy Rato
10 points
,l\.s usod horein, tho torm "Occupancy R::lto" shall mean a fraction oxprossod ::lS ::l
percentago, tho numor::ltor of which shall bo oqual to tho tot::ll numbor of uses of the four
(1) h::llls ::It tho Convontion Contor, with ::In o'.'ont hold in ::lny one (1) hall on a given d::lY
constituting one (1) use, and the denominator of which sh::lll bo oqu::l1 to 1,160.
Theater up to 10 points
180 use days held during a Fisc::l1 YO::lr
3 points
195 use d::lYs hold during a Fisc::l1 YO::lr
6 points
210 use days held during ::l Fiscal Year
10 points
The partios sh::lll moot to adjust in good f::lith, the point ::lllocation for tho
Tho::ltor and the corresponding requisite use days upon the opening of the Miami
Performing Arts Contor.
7. Section 4.3 of the Agreement, entitled "Incentive Fee", subsection
(a) (v) thereof, entitled "Discretionary", is deleted in its entirety.
(iv) Discretionary. Tho City sh::lll ::lward SMG up to ton (10)
percentago crodits ::lS determinod by the City in its solo discretion. The City may tako
into account, but not be mand::ltod by, tho following: ox-tr::lordinary quantifi::lblo and
measur::lblo creative initi::ltives th::lt directly rosult in SMG socuring no'.\' City wide
business for tho City of Mi::lmi Beach during the off season poriod; and/or domonstr::ltion
and integr::ltion of new str::ltegic SMG technic::llly advancod corpor::lto resourcos to tho
bonofit of tho tourism ::lnd/or cultural community of Mi::lmi Be::lch; and/or servos to
dovolopment of now or onhanced rovenuo stroams for Facility use and servicos, as
otherwiso determinod by City.
8. Section 12.2 of the Agreement, entitled "Termination Other than
Upon Default", is amended to include a new subsection (c) therein, as follows:
(c) The City may terminate this Aareement in part. without cause and for
convenience. with reaard to termination of SMG's riohts and responsibilities with
respect to the operation. manaaement. promotion. supervision. and maintenance
of the Jackie Gleason Theater of the Performino Arts (Theater). said partial
termination to become effective upon sixty (60) days prior written notice to SMG.
In the event of such partial termination. the Manaoement Fee for performance of
services with respect to the Miami Beach Convention Center provided hereunder.
will be reduced. at that time. by 13 % from the then effective Manaoement Fee.
Such adiusted Manaoement Fee shall be adjusted upward on the first day of
each Fiscal Year durina the term hereof by the percentaae chanae in the
Consumer Price Index - All Urban Consumers (CPI-U) - U.S. City Averaae - All
Items. durina the one year period endina September 30 immediately precedino
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 aaency of the United States Government
succeedina to its functions ("CPI").
In the event of such partial termination. the City will determine how best to
facilitate continued use of the Community Benefit Fund for the purpose of
providina reduced-price tickets to Miami Beach resident senior citizens and
students. and for fundina of events beneficial to the citizens of Miami Beach.
In the event of such partial termination. the City and SMG will also
determine how best to facilitate continued use of the Co-Promotion Fund. which
is desioned to promote. solicit. and/or produce on its own. in association with or
throuoh a local or national promoter. major entertainment events in the City of
Miami Beach.
Furthermore. any other applicable terms and conditions in the Aoreement.
shall be amended to accurately reflect any eauitable adiustment(s) in the parties'
respective riahts and oblioations under the Aoreement. as a result of the deletion
of the Theater.
9. No Further Modifications. Except as provided in this Amendment
No.2, the Agreement remains unmodified and in full force and effect.
[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, this Agr en
parties hereto as of the day and year first above ri ten
ATTULf p~t4
City Clerk
Robert Parcher day of ,2006.
SMG -tl-.w~
ATTEST:
~-; ~7 President
Se tary rh-{U:>l d \N e s. +-l-e...,
Print Name
~o ~N f. ~iZ. IV S '2...9 day of S~r\ ,2006.
Print Name
F:\info\$ALL\Max\TCD\SMG\SMG Amendment No 2 Amendment 081006.doc
APPROVED AS TO
FORM & LANGUAGE
OR EXECUTION
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