2007-26548 Reso
RESOLUTION NO. 2007-26548
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, WAIVING, BY 5/7THS VOTE,
THE FORMAL COMPETITIVE BIDDING REQUIREMENT, AND
APPROVING AND AUTHORIZING THE MAYOR AND CITY CLERK
TO EXECUTE A MANAGEMENT AGREEMENT WITH LIVE NATION
WORLDWIDE, INC. FOR THE JACKIE GLEASON THEATER OF THE
PERFORMING ARTS; SAID AGREEMENT HAVING AN INITIAL
TERM OF TEN (10) YEARS, COMMENCING ON JUNE 1,2007, AND
ENDING ON MAY 31,2017, WITH TWO (2) FIVE YEAR RENEWAL
OPTIONS, AT THE DISCRETION OF THE CITY.
WHEREAS, at its meeting on July 27, 2005, the City Commission referred a
discussion on a proposed development agreement and long term lease between the City
and Cirque du Soleil (CDS) to operate the Jackie Gleason Theater of the Performing Arts
(the Theater), as a permanent venue for a CDS show, to the Finance and Citywide Projects
Committee; and
WHEREAS, at the July 12, 2006, City Commission meeting, the City Commission
directed the Administration to solicit proposals from two (2) other firms, AEG Live and Live
Nation, which (in addition to CDS) had also expressed interest in initiating discussions with
the City, as possible alternatives for the future use and operation of the Theater; and
WHEREAS, at its meeting of August 17, 2006, the Finance and Citywide Projects
Committee discussed a process and proposed guidelines for reviewing the aforestated
proposals for the operation of the Theater; and
WHEREAS, the City Manager reported that, as discussions between the City
Administration and CDS had been ongoing for nearly a year, and the parties were (at that
time) close to finalizing a "best and final proposal", what was specifically required was a
process and guidelines for submission that would also include submittal of the expected
proposals from AEG Live and Live Nation; accordingly, the Committee approved the
Administration's recommendation regarding said process and guidelines; and
WHEREAS, on September 6,2006, pursuant to Resolution No. 2006-26320, the
Mayor and City Commission approved the subject process and guidelines (including the
approval of a "modified" Cone of Silence); and
WHEREAS, in accordance with the proposed process/guidelines, initial proposals
and Term Sheets were submitted to the City Manager by the three proposers on August
31,2006, and completed "Best and Final" proposals and Term Sheets were submitted to
the City Manager by September 29, 2006; and
WHEREAS, on October 16, 2006, a public meeting was held at the Theater at which
time the City Manager presented a summary of the substantive points of the three (3)
offers submitted respectively, by 1) CDS; 2) AEG Live; and 3) Live Nation, as well as
obtained input from the public as to sentiments regarding the Theater's potential future use
and operator; and
WHEREAS, a Special City Commission meeting was held on October 18, 2006, at
which time the Mayor and City Commission heard presentations by 1) AEG Live and 2)
Live Nation; priorthe commencement of the meeting, CDS voluntarily withdrew its proposal
from consideration; and
WHEREAS, at the conclusion of the aforestated parties' respective presentations,
the Mayor and City Commission heard additional public comment; and
WHEREAS, having heard and considered the 1) presentation and recommendations
by the City Administration; 2) the respective presentations by AEG Live and Live Nation;
and 3) (in addition to the public meeting on October 16,2006) further public comment, the
Mayor and City Commission approved Resolution No. 2006-26377, which authorized the
City Administration to proceed with negotiations with Live Nation and, if such negotiations
were unsuccessful, proceed to negotiate with AEG Live; and
WHEREAS, in addition to the terms of Live Nation's offer/Term Sheet, the Mayor
and City Commission further recommended that the Administration negotiate the following
additional terms: 1) request that Live Nation share equally in the payment of any
property taxes, if imposed; 2) request a City right to terminate the agreement if
economically necessary; 3) request that a provision for Live Nation to assume the
management and booking of the Byron and Colony Theaters be added; 4) provide the City
reasonable rights in booking the Theater for City use; 5) provide scheduling rights for non-
profit organizations and community groups; 6) secure a corporate guaranty; 7) initial term
should be 10 years; and 8) request that the annual escalator be increased to 3%; and
WHEREAS, accordingly, the City Administration and Live Nation have negotiated
the attached Management Agreement for the continued operation, management,
maintenance, marketing, and promotion of the Theater as a live entertainment venue and
public auditorium; and
WHEREAS, the substantive terms of the Management Agreement were presented
to and discussed by the Finance and Citywide Projects Committee Meeting at a special
meeting held on May 9,2007; and
WHEREAS, notwithstanding the process and guidelines adopted by the City
Commission pursuant to Resolution No. 2006-26320 for review and consideration of the
offers to manage and operate the Theater, approval of the subject Management
Agreement requires a waiver, by 5/7ths vote, of the formal competitive bidding
requirement; accordingly, the City Manager hereby recommends that the Mayor and City
Commission waive the competitive bidding requirement, finding such waiver to be in the
best interest of the City.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby waive, by 5/7ths vote, the formal competitive bidding requirement, and
approve and authorize the Mayor and City Clerk to execute a Management Agreement with
Live Nation Worldwide, Inc. for the Jackie Gleason Theater of the Performing Arts; said
Agreement having an initial term of ten (10) years, commencing on June 1, 2007, and
ending on May 31 , 2017, with two (2) five year renewal options, at the discretion of the City.
ATTEST: PASSED and ADOPTED this 16th day of ft' 2007.
/ I i
/ /
;/ '
/
M{M.{ p tU~
CITY CLERK
Robert Parcher
F:\atto\AGUR\RESOS-ORD\Live Nation - Mgmt. Agreement Reso (FinaI5-10-07).doc
APPROVED AS TO
FORM & LANGUAGE
& FO EXECUTION
/6 ~
7['.', y:
't~ ,
COMMISSION ITEM SUMMARY
Condensed Title:
A Resolution Waiving By 5/7ths Vote The Formal Competitive Bidding Requirement, And Approving
And Authorizing The Mayor And City Clerk To Execute A Management Agreement With Live Nation
Worldwide, Inc, For The Jackie Gleason Theater OfThe Performing Arts; Said Agreement Having An
Initial Term OfTen (10) Years, Commencing On June 1, 2007, And Ending On May 31,2017, With
One (1) Five Year Renewal Option At The Discretion Of Live Nation, And One (1) Five Year Renewal
Option At Mutual Agreement.
Ke Intended Outcome Su orted:
Increase Community rating of cultural activities
Issue:
Should the City approve and execute the agreement?
Item Summary/Recommendation:
On October 18, 2006, the City Commission decided to continue operating the Jackie Gleason Theater
of the Performing Arts as single night or limited run rental venue, to be managed by an international
live entertainment company that would incur a level of risk in programming the facility while
guaranteeing the City a base return. Of the three companies that were solicited by the City to make
proposals, the City Commission authorized the Administration to negotiate with Live Nation
Worldwide, Inc. via Resolution No. 2006-26377,
The Agreement represents an appropriate and fair agreement to the City. The Live Nation proposal
will provide a guaranteed return to the City and will provide regular and active programming in the
facility. This will provide a significant operational change as the facility will move from a heavily
subsidized operation to one that provides an operating surplus.
Financial Information:
Source of Amount Account Approved
Funds: 1
D 2
3
4
OBPI Total
Financial Impact Summary:
Ci Clerk's Office Le islative Trackin
Carla Gomez, xt. 6713
Si n-Ofts:
Department Director
Assistant City Manager
City Manager
tD
....
MIAMI BEACH
AGENDA ITEM
DATE
Rl t::
~-l~ -07
m MIAMI BEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachR.gov
COMMISSION MEMORANDUM
FROM:
Mayor David Dermer and Members of the City Commission
Jorge M. Gonzalez, City Manager \ ~~
May 16, 2007 0
A RESOLUTION WAIVING BY 5/7THS VOTE THE FORMAL COMPETITIVE
BIDDING REQUIREMENT, AND APPROVING AND AUTHORIZING THE MAYOR
AND CITY CLERK TO EXECUTE A MANAGEMENT AGREEMENT WITH LIVE
NATION WORLDWIDE, INC. FOR THE JACKIE GLEASON THEATER OF THE
PERFORMING ARTS; SAID AGREEMENT HAVING AN INITIAL TERM OF TEN
(10) YEARS, COMMENCING ON JUNE 1, 2007, AND ENDING ON MAY 31, 2017,
WITH ONE (1) FIVE YEAR RENEWAL OPTION AT THE DISCRETION OF LIVE
NATION AND A SECOND FIVE YEAR RENEWAL OPTION UPON MUTUAL
AGREEMENT OF THE PARTIES.
TO:
DATE:
SUBJECT:
KEY INTENDED OUTCOMES SUPPORTED
· Improve community rating of cultural activities
· Improve availability and accessibility of major events
BACKGROUND
The Jackie Gleason Theater of the Performing Arts, originally named the Miami Beach
Municipal Auditorium, has been recognized for its contributions to the City of Miami Beach's
iconic reputation. The Auditorium was built in the 1950's and quickly became the home of
many "Golden Era" legends and major sporting events. In the early 1960's, the Auditorium
began hosting the successful Jackie Gleason Show, which helped garner the attention of
famous Hollywood celebrities and inevitably boosted Miami Beach's tourist industry.
Throughout the 1990's to present day, the Jackie Gleason Theater (JGT) maintains its
adaptive approach to an ever-changing entertainment environment, and continues to attract
a variety of programming. The Jackie Gleason Theater of the Performing Arts currently
operates as a "Single Night/Limited Run Live Entertainment Rental Facility". The Facility
accepts booking from live entertainment acts on a "first come, first serve" basis. JGT is
operated by SMG through a Management Agreement with the City, where the City pays SMG
a pre-determined fee for its services. While SMG also acts as the booking agent for the
JGT, neither the City nor SMG assume any risk for the entertainment acts and/or artists that
rent the facility to perform. Each entity that rents the JGT handles its own promotion,
marketing, revenue/expenses, and related managerial and operational responsibilities.
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 2 of 16
SMG and the City continue to pursue live entertainment acts and artists to perform in the
JGT, and are able to attract a variety of programming. SMG books an array of local talent, as
well as international traveling performers and companies. The JGT is also available for
private functions, as there are several private event rooms that can be used for meetings,
catered parties and other social occasions. The Theater is also used for large gatherings
such as high school graduations and award presentations.
Programming in recent years has included:
. MTV Latin America
. Video Music Awards (VMA)
. Fox Sports Americas Awards
. Billboard Latin Music Awards
. Telemundo's "Azucar," A Tribute to Celia Cruz
. Comedy performances (Chris Rock, Dave Atell, BET Comic View)
. International Dance performances
IMPACT OF CARNIVAL CENTER OF THE PERFORMING ARTS (PAC)
Despite the Theater's success, recently, the JGT has found itself struggling in a highly
competitive market for live entertainment in the local area. Some of these competing venues
include; including the Seminole Hard Rock Cafe; the Gusman Theater; American Airlines
Arena; Waterfront Theater at the American Airlines Arena; Bank Atlantic Center; the James
L. Knight Center/Miami Convention Center Auditorium; and the Frank Sinatra Theater at the
Bank Atlantic Center.
In the past four years, total rented days, annually, in the JGT have ranged in number from a
high of 162 days in 2003, to a projected low of 117 days in 2006. Although the Theater was
booked on a regular basis, bookings have been steadily declining, and the JGT has
consistently operated at a significant deficit. In 2005, the net operating deficit was $321,000.
When depreciation and insurance charge backs are applied to the JGT budget, the 2005
gross operating deficit increases to $1.48 million. The gross operating deficit is consistent
over the past few years, with little variance, as it has consistently been just over $1 million
annually.
With its grand opening on October 5, 2006, the Carnival Center of the Performing Arts
("PAC") in downtown Miami creates a cultural, artistic and economic revival for this
community. The PAC consists of three state-of-the-art performance facilities, and has a goal
to present over 300 performances a year. Its well-publicized first season includes ballet,
theater, symphonic and other musical presentations. The PAC is also equipped to hold other
cultural events, social occasions and business meetings. At 570,000 square feet, this facility
already has an advantage over other venues in the area based on accommodation alone.
The Carnival Center ofthe Performing Arts has demonstrated to be a tremendous impact on
the JGT's declining success. Shortly after opening its doors, the Carnival Center of the
Performing Arts has prompted the migration of three major companies; the Miami City Ballet;
the Concert Association, and the Broadway Series, which accounted for 33% of total revenue
and one-third of the available use days of the JGT in 2005.
The JGT is currently operating at a deficit, and any further exodus of revenue-producing
events and erosion in attendance will result in additional negative impact. In addition, the
JGT incurs an annualized average of just over $900,000 (in 2003 dollars) for Capital Renewal
and Replacement costs. This cost should be added to the gross operating deficit in order to
gain a better picture of the financial status of the current operation. When capital costs are
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 3 of 16
added to the gross operating deficit, the total shortfall of revenues to expenditures in 2005
was approximately $2.4 million.
In an effort to continue to sustain the viability of the Jackie Gleason Theater of the
Performing Arts, the City began considering possible options for the Venue. On October 18,
2006, a Special Commission Meeting was held to discuss the potential options for the future
of the Jackie Gleason Theater. Initially four possibilities were identified as viable options for
the future of the Theater. They included; (1) Continue as principally a single night or limited
run rental venue (Live Entertainment), (2) Explore movement toward extended run theatrical
presentations, (3) Conversion to permanent installation of a theatrical attraction (Single
Purpose Venue), or (4) Conversion to alternate use (meeting space/ballroom/exhibit space).
Separate, but related, is the fact that the City's Community and Business Survey has
continually shown a desire by our residents to increase the accessibility to cultural activities
in the City. The most recent survey data shows that within this subset, almost 1/3 of the
residents would like to see more live music and concerts. These numbers vary slightly by
age group and ethnicity, but all groups valued access to live music and concerts as a high
priority (tables illustrating the results appear in Attachment "B"). The Commission's selection
of a live music and concert promoter, such as Live Nation, is consistent with the survey
results.
During the Special Commission Meeting, the City Commission made its decision to maintain
the Facility as a single night or limited run rental venue that would be managed by an
international live entertainment company that would incur the risk of programming for the
facility, while guaranteeing the City a base return. Resolution No. 2006-26377 authorized the
Administration to negotiate with Live Nation Worldwide, Inc., a publicly-traded company that
manages and operates live venues and promotes and produces live entertainment events.
LIVE NATION
Live Nation is a publicly-traded company that manages and operates live venues and
promotes and produces live entertainment events. Live Nation evolved as the result of a
series of acquisitions of entertainment businesses and assets, and a later spin-off of Clear
Channel Communications. It is considered the world's largest producer of live music.
Clear Channel Communications
Clear Channel is a San Antonio-based company which grew from about 40 radio stations in
1996, to more than 1 ,200 today, and is also heavily involved in the billboard and television
businesses. Clear Channel is a public company, which began the concert promotion
business in 2000, through the acquisition of SFX Entertainment, Inc., which at the time was
one of the world's largest concert promoters. Following the acquisition, SFX changed its
name to Clear Channel Entertainment. Media reports indicated that Clear Channel intended
to build a multimedia advertising conglomerate through which sponsors and advertisers
could "one-stop-shop" for multiple advertising outlets, by using thousands of billboards and
radio stations to cross-promote their concerts. Adshel, the company that provides the
directories on Lincoln Road and the new bus shelters, is a division of Clear Channel.
Live Nation
In December 2005, the live entertainment and sports representation segment (Clear Channel
Entertainment) of the business was separated as Live Nation, a separate publicly traded
company. According to the Wall Street Journal, industry analysts agreed that this was a
good move for Clear Channel, as this segment of the business was the most volatile and the
least profitable segment of their business. Clear Channel principals remain among Live
Nation's directors. The 2005 SEC filing for the creation of Live Nation also included "avoiding
Commission Memorandum - Live Nation Management Agreement
May 16,2007
Page 4 of 16
regulatory and legal pitfalls" as some of the reasons for the split from Clear Channel. There
was also growing concern regarding the size and reach of such a large entertainment /
advertising conglomerate.
Live Nation is the largest concert promoter in the United States, and principally acts in the
following capacities, performing one, two, or all in connection with the events and tours that
they promote: Venue Operation; Sponsorships and Advertising; and Promotion and
Production. Their operating segments include Global Music, which involves the promotion
and production of live music performances and tours; Global Theater, which is principally the
presentation of touring and other theatrical performances; and other live entertainment
events.
In 2005, the company had $1.3 billion in concert box-office sales, and promoted, produced,
or hosted over 29,500 events. These events included music concerts, theatrical
performances, motorsports, and other types of events. Live Nation owns or operates over
160 venues throughout North America and Europe. These venues are amphitheaters,
theaters, clubs, arenas, and festival sites.
Live Nation, Inc. is registered in Delaware as a general business corporation, and has
subsidiaries in 25 other states and the District of Columbia to carry out various activities
associated with live concert, event and theater productions.
Recent Developments
Live Nation recently acquired House of Blues, which will add 18 concert halls to their
portfolio. According to recent media reports, Live Nation is battling Ticketmaster for control
over the cost of show admissions. Ticketmaster has exclusive rights, through 2008, to sell
tickets to most of Live Nation's events. According to the same media reports, while Live
Nation has not made a decision, it could rely on its in-house ticketing system, which has
been portrayed as the third-largest in America.
Live Nation stated that the acquisition of House of Blues would broaden its presence in the
midsize concert category and fill geographical gaps in its amphitheater network. In addition to
the acquisition of House of Blues, in November 2006, "The Wall Street Journal" reported that
Live Nation was acquiring a majority stake in Musictoday LLC, a company that runs fan
clubs, web sites, and online stores. In August, Live Nation sold three divisions of its SFX
Sports Group to Blue Equity, LLC. Live Nation sold the tennis representation, sports media &
live sporting events platforms. In September, Live Nation sold its SFX Baseball division.
Most recently, the company acquired the remaining interest in TRUNK LTD., a company
renowned for its authentic music-inspired lifestyle merchandise.
Chief Executive Officer, Michael Rapino has indicated that the company's strategy is to
improve sales per fan with fan clubs, parking, food and beverage receipts, merchandising,
live recordings, and digital access to live events. He further stated that Live Nation's goal is
to be the leading live music destination on-line, and to increase its presence in the largest
and most profitable markets in the United States and internationally.
Live Nation has recently reorganized its business into (1) Events; (2) Venues and
Sponsorship; and (3) Digital Distribution.
Manaoement
Michael Rapino, CEO; Bruce Eskowitz, CEO, North American Music; Faisel Durrani,
President of Marketing, Artist Marketing Products; David lan, Chairman Global Theatrical;
Alan Ridgeway, CFO; Michael Rowles, Executive Vice President and General Counsel; Neil
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 5 of 16
Jacobsen, President, Live Nation Miami; and AJ Wasson, Senior Vice President of Venues
Florida Region.
Venues
Live Nation's venue list includes amphitheaters, theaters, clubs, arenas, and festival sites.
These include the Wilturn LG in Los Angeles; Sound Advice Amphitheater in Palm Beach;
the RoxyTheatre and the Tabernacle in Atlanta; the Fillmore Auditorium in Denver; the State
Theatre in Detroit; the Tower Theatre in Philadelphia; the Fillmore in San Francisco; the Ford
Amphitheater in Tampa; the Wilbur Theatre in Boston; Nikon at Jones Beach in New York;
and the Empire Theatre in San Antonio.
Artists
Shows produced by Live Nation in 2006 included The Rolling Stones; Barbara Streisand;
Madonna; Coldplay; Pearl Jam; Red Hot Chili Peppers; Ray Davies; Soulfly; The Pretenders;
UB40; Beck; Hank Williams III; Ice Cube; Indigo Girls; Paul Oakenfold; Pink; Sonic Youth; the
Doobie Brothers; Willie Nelson; Ricky Martin; Rob Zombie, Sevendust; Staind; Kathy Griffin;
and Van Morrison.
PROPOSED AGREEMENT
The following table summarizes the negotiated Agreement, which is substantially similar to,
although improved, the original Live Nation proposal.
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
1. Definitions/Form Management Agreement Lease or Management Agreement.
of Agreement
2. Scope of Services Live Nation to operate, manage, Live Nation to operate, manage,
promote and market the Facility promote and market the Facility
during Term and Renewal Term. during term and renewal term.
Live Nation shall cause at least 50
Events to be held at the Facility for
each Fiscal Year.
3. Management Initial Term 10 years Fifteen (15) years
one (1) five year renewal at the Two five year renewals exercisable
Term and discretion of Live Nation and one (1) on six months prior notice.
Renewal Term additional 5 year renewal upon
mutual aQreement.
4. Management Fee Live Nation to receive Management 100% of Net Operating Profit with
Fee from the Net Operating Profit: no specific breakout for
(from net (i) Annual Management Fee of Management Fee.
operating profit) $400,000 paid in equal monthly
installments, with 2% upward
adjustment beginning January 1,
2009.
(ii) Bonus- entitled to retain
remaining Net Operating Profits for
given Fiscal Year
Commission Memorandum - Live Nation Management Agreement
May 16,2007
Page 6 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
5. Required City Commencement Date through Proposed rent of $1,000,000
December 31, 2007 - the pro-rated annually, pro-rated for first year.
Distribution sum of $500,000. Year commencing January 1, 2008,
the sum of $1,020,000.
Year Commencing January 1, 2008
- the sum of $1 ,020,000.
Year Commencing January 1,2009
and each Year thereafter for the
remainder of the initial term - the
amount equal to the product of 1.02
multiplied by the Required City
Distribution in effect for preceding
the Year.
6. Bonus For each paid ticket for attendance For each paid ticket for attendance
Distribution on for events during a calendar year in for events during a calendar year in
excess of 240,000 tickets during the excess of 240,000 tickets during the
Ticket Sales applicable calendar year, Live nation applicable calendar year, Live nation
will pay city a bonus rent of $1.00 will pay city a bonus rent of $1.00
per excess paid ticket; there is per excess paid ticket; there is
excluded from the calculation of excluded from the calculation of
paid tickets any discounted tickets paid tickets any discounted tickets
under the Community Benefit Fund under the Community Benefit Fund
program for which Live Nation is not program for which Live Nation is not
fully compensated at face value, city fully compensated at face value, city
events, Play Ground Review, and events, Play Ground Review, and
charitable events. And third party charitable events. And third party
rentals of the Venue. rentals of the Venue.
7. Bonus City receives $2,000 per event in After there are 200 events at the
Distribution on excess of 173 events during a Venue in a calendar year, then for
calendar Year, Le., if 200 events each subsequent event at the
Events were held during a calendar year, Venue for the remainder of such
then City would receive $54,000. calendar year, Live Nation will pay
City a bonus rent of $2,000; there is
Third party rentals substantively excluded from the calculation of
similar in nature to Live Nation events any city events, Play Ground
events to be included. Review, charitable events and third
party rentals of the Venue.
8. Proposed Live to perform remodeling, upgrade Within the first two years of the
and improvements not to exceed lease term, Live Nation will expend
Upgrades $3,500,000 (both hard and $3,500,000 for capital improvements
reasonably soft costs) and will be to perform the following capital
completed by December 31,2009 improvements:
(detailed in Attachment A).
L Remove the seating in the L Remove the seating in the
front half of the orchestra front half of the orchestra
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 7 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Proposed Upgrades level and replace with two level and replace with two
terraced platforms. terraced platforms.
(Cont.) ii. Provide movable seating and ii. Provide movable seating and
tables for a flexible tables for a flexible
configuration. config u ration.
iii. Provide new high back VIP iii. Provide new high back VIP
chairs at front of mezzanine. chairs at front of mezzanine.
iv. Update the auditorium iv. Update the auditorium
finishes including new finishes including new
draperies, lighting, paint, draperies, lighting, paint,
seating fabric and carpet. seating fabric and carpet.
New finishes will be New finishes will be
designed to improve the designed to improve the
acoustics for amplified acoustics for amplified
music. music.
v. Update draperies, lighting v. Update draperies, lighting
and paint finishes in the and paint finishes in the
lobby to change the image of lobby to change the image of
the space. the space.
vi. New Bars, lighting, finishes vi. New Bars, lighting, finishes
and furnishings to create an and furnishings to create an
upscale atmosphere and upscale atmosphere and
more points of sale. more points of sale.
vii. $200,000 allowance for a vii. $200,000 allowance for a
significant new exterior sign. significant new exterior sign.
viii. Update and reconfigure viii. Update and reconfigure
dressing areas as required dressing areas as required
to provide appropriate to provide appropriate
headliner and band headliner and band
accommodations including accommodations including
new paint, carpet and new paint, carpet and
millwork. millwork.
9. Maintenance and Live Nation responsibility to maintain Live Nation responsibility, except
Repairs the facility, including without parking which is City's.
limitation all electrical, HVAC, life
safety, mechanical, plumbing and
other building systems, including
capital replacement.
10. Taxes The property is presently exempt City to pay all real estate taxes.
from paying real estate taxes. In the
event that the execution of the
Management Agreement, or similar
occurrence, triggers a situation
where the property is subject to real
estate taxes, then City has the right
to terminate the agreement, at any
Commission Memorandum - Live Nation Management Agreement
May 16,2007
Page 8 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Taxes (Cont.) time during the term, with 30 days
notice. If agreement is terminated
for this reason, then City will
reimburse Live Nation unamortized
cost of the proposed uPQrades.
11. Rent Free City City may use the Venue twice per City may use the Venue twice per
calendar year rent free, subject to (i) calendar year rent free, subject to (i)
Use availability and pre-scheduling with availability and pre-scheduling with
Live Nation, (ii) any expenses for Live Nation, (ii) any expenses for
Live Nation's operation being Live Nation's operation being
reimbursed by City, (iii) Live Nation reimbursed by City, (iii) Live Nation
keeping all food and beverage keeping all food and beverage
revenues, but City may orohibit revenues, (iv) events held not
sale of alcohol, (iv) events held not violating any sponsorships, and (v)
violating any sponsorships, (v) no no use for concerts that violate
use for concerts that violate sponsorship terms, and (vii) no roll
sponsorship terms, and (vii) no roll over for any of City's unused
over for any of City's unused portion.
portion.
12. Rent Free City City, or its designated charitable City, or its designated charitable
organization, may use the Venue organization, may use the Venue
Charitable Use two (2) occasions per calendar once per calendar year rent free for
year rent free for the purposes of a the purposes of a charitable event,
charitable event, subject to (i) subject to (i) availability and pre-
availability and pre-scheduling with scheduling with Live Nation, (ii) any
Live Nation, (ii) any expenses for expenses for Live Nation's operation
Live Nation's operation being being reimbursed by City or the
reimbursed by City or the designated charitable organization,
designated charitable organization, (iii) Live Nation keeping all food and
(iii) Live Nation keeping all food and beverage revenue, (iv) events held
beverage revenues, but City may not violating any sponsorships, and
orohibit sale of alcohol (iv) events (v) no use for concerts.
held not violating any sponsorships,
and (v) no use for concerts.
13. Rent Free City City may use the Venue once (which City may use the Venue once (which
Play Ground includes three (3) consecutive includes one night for rehearsal and
Review Use days and niahts) per calendar year the following night for the event) per
rent free for the purposes of hosting calendar year rent free for the
the annual Play Ground Review purposes of hosting the annual Play
event, subject to (1) availability and Ground Review event, subject to (1)
pre-scheduling with Live Nation, (ii) availability and pre-scheduling with
any expenses for Live Nation's Live Nation, (ii) any expenses for
operation being reimbursed by City, Live Nation's operation being
(iii) Live Nation keeping all food and reimbursed by City, (iii) Live Nation
beverage revenues, but City may keeping all food and beverage
orohibit sale of alcohol (iv) event revenues, (iv) event held not
held not violating any sponsorships, violating any sponsorships, and (v)
no use for commercial concerts
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 9 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Rent Free City Play and (v) no use for commercial versus concerts performed by local
concerts versus concerts performed talent as part of the Play Ground
Ground Review Use by local talent as part of the Play Review.
(Cont.) Ground Review.
14. Free Booking City entitled to receive Live Nation's Live Nation will give City free
professional consulting with respect consulting advice on the booking
and/or to City's booking and programming and/or programming options at the
Programming for Byron & Colony Theaters. Byron and Colony venues.
Consultation for
Byron and Colony
15. Complementary City shall be entitled to 26 City shall be entitled to 20
complementary tickets to each Live complementary tickets to each
City Tickets Nation event open to the general event which is open to the general
public that is in the top 30% of price public and is not a Charitable Use or
level. the Play Ground
Review.
16. Complementary 28 complementary tickets, if [Not addressed in proposal]
available, for Miami Dade County
Tickets to Schools that are part of the feeder
Schools in pattern for Miami Beach residents.
Support of the
Social Compact
17. Annual Event and Live Nation will help the City Live Nation will help the City
Auction for enhance the City's community social enhance the City's community social
improvement programs by donating improvement programs by donating
Community to the City the net proceeds from the to the City the net proceeds from the
Needs following: following:
I. Live Nation will request that I. Live Nation will request that
each act performing at the each act performing at the
Venue autograph two pieces Venue autograph two pieces
of memorabilia for Live of memorabilia for Live
Nation to include at an Nation to include at an
annual auction, with the net annual auction, with the net
proceeds of the auction to proceeds of the auction to
be given to the City for the be given to the City for the
City's use in enhancing the City's use in enhancing the
City's current community City's current community
social improvement social improvement
programs or such other programs or such other
social programs for social programs for
community benefit as the city community benefit as the city
may desire; and may desire; and
II. Live Nation will host an II. Live Nation will host an
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 10 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Annual Event and annual event at the Venue, annual event at the Venue,
which may include the above which may include the above
Auction for auction, for the purposes of auction, for the purposes of
Community Needs promoting the community promoting the community
(Cont.) social improvement social improvement
programs for the City, with programs for the City, with
the net proceeds of the the net proceeds of the
auction to be given to the auction to be given to the
City for the City's use in City for the City's use in
enhancing the City's current enhancing the City's current
community social community social
improvement programs or improvement programs or
such other social programs such other social programs
for community benefit as the for community benefit as the
City may desire. City may desire.
18. Community Live Nation will continue the current Live Nation will continue the current
Community Benefit Fund discounted Community Benefit Fund discounted
Benefit Fund ticket program for senior citizen and ticket program for senior citizen and
student residents of the City for any student residents of the City for any
events which are open to the events which are open to the
general public, with any changes to general public, with any changes to
the current program to be approved the current program to be approved
by Live Nation. by Live Nation.
19. Resident Ticket Live Nation shall provide a resident Live Nation shall provide a resident
Program ticket program, providing priority ticket program, providing priority
access to tickets for residents of the access to tickets for residents of the
City, which program will have the City, which program will have the
following requirements: following requirements:
i. Live Nation will determine i. Live Nation will determine
which events are available which events are available
for this program; for this program;
ii. There will be 100 tickets ii. There will be 100 tickets
available for this program, available for this program,
with the type and location to with the type and location to
be determined by Live be determined by Live
Nation for each applicable Nation for each applicable
event; event;
iii. The tickets for this program iii. The tickets for this program
will be available two (2) days will be available two (2) days
before tickets go on sale to before tickets go on sale to
the public and the tickets will the public and the tickets will
be held until one (1) week be held until one (1) week
after the public sale date; after the public sale date;
iv. The resident purchasing the iv. The resident purchasing the
tickets will pay full ticket tickets will pay full ticket
price and any applicable price and any applicable
Commission Memorandum - Live Nation Management Agreement
May 16,2007
Page 11 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Resident Ticket surcharge or commissions; surcharge or commissions;
v. The tickets will be available v. The tickets will be available
Program (Cont.) at the Venue box office; and at the Venue box office; and
vi. To purchase the tickets vi. To purchase the tickets
residents will be required to residents will be required to
provide suitable evidence provide suitable evidence
documenting bona fide City documenting bona fide City
residency, including, but no residency, including, but no
limited to, photo ID, utility limited to, photo ID, utility
bill, schoollD, etc. bill, schoollD, etc.
20. Naming Rights City reserves all naming rights, but City's reasonable consent required
does not preclude Live Nation from for a new corporate sponsorship
allowing sponsors of temporary name of the Venue not utilizing
events from using temporary interior "Jackie Gleason" - this is a name in
banners and signage. title sponsorship and Live Nation to
pay City 25% of the net naming
rights revenues received for a name
in title sponsorship; no consent shall
be required for any new
identification of the venue which is
not part of a corporate sponsorship
program as long as Live Nation
continues to maintain "Jackie
Gleason" as part of the advertising
for the Venue.
21. Sponsorships Allowed inside the building only. No No consent required; all revenues
consent required; all revenues will belong to Live Nation.
belona to Live Nation.
22. City Image Live Nation will use good faith Live Nation will use good faith
efforts in its operation of the Venue efforts in its operation of the Venue
to ensure that the image of the City to ensure that the image of the City
will not be detrimentally impacted by will not be detrimentally impacted by
such operations. such operations.
23. First-class Facility Live Nation will operate the Venue in Live Nation will operate the Venue in
such manner to maintain the Venue such a manner to maintain the
as a first-class facility substantially Venue as a first-class facility
similar to the other comparable substantially similar to the other
venues operated by Live Nation in comparable venues operated by
the United States. Live Nation in the United States.
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 12 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
24. Parking City reserves sole rights to all i. City to provide parking for all
parking, including valet parking. events
Live Nation to have the right to ii. City to operate all parking
negotiate for pre-purchase parking facilities and all revenues to
at the City's standard rates as part belong to City
of a VIP package for Live Nation to
resell; however, a separate Master
Agreement, approved by City
Commission is required.
25. Permitted Use Facility shall be used only as a live Public entertainment, live
entertainment venue and for such entertainment, public assembly or
ancillary uses as are customarily any combination thereof, bar and/or
related to such primary use, restaurant; together with related and
including bar and food concessions ancillary uses thereto, including,
and sale of merchandise related to without limitation, broadcasting,
any Event then being held. Other recording, filming, preparation and
uses may be allowed only with prior sale of food, merchandise, and
written approval from City Manager. alcoholic beverages, and catering
No Event or other uses shall be and private parties or functions.
permitted that adversely affect City's Live Nation's booking for the Venue
image or present safety concerns. will be consistent with the booking at
Live Nation does not have permitted other similar venues owned or
use of the front lawn. operated by Live Nation so as to
allow for a wide spectrum of
Prohibition against operating as a available musical performances and
night club venue and limit on the types of music.
sale of food and alcohol to the
ending of concert/entertainment
event and/or midnight.
26. Preferred Rates A standard booking policy that [Not addressed in proposal]
for Convention provides for advance booking and
holds for convention center events
Center bookings in the JGT as well as for community
and Community and charitable groups is in the
and Charitable agreement.
groups
27. Major Events A designated rep from Live Nation [Not addressed in proposal]
will attend all City held MEP
meetings.
28. Termination Both parties have the right of [Not addressed in proposal]
Rights termination in the event of an
uncured default of the other party.
In addition:
Live Nation has the right of
termination under the following
circumstances: 1) existing bonds on
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 13 of 16
TERM SUMMARY OF AGREEMENT ORIGINAL PROPOSAL FROM LIVE
NATION
Termination Rights JGT are either not defeased or City
has received opinion of bond
(Cont.) counsel that defeasance is not
required; or 2) the name of the
facility is not changed to include
"Fillmore" by October 31,2007, or 3)
the "Upgrade Consents" are not
secured by June 30,2007.
Should termination occur, for a
reason other than "Early
Termination", Live Nation to be
reimbursed for unamortized capital
improvement.
City has right of termination in the
event that real estate taxes and/or
sales taxes are imposed on the
property and/or Management
Agreement and this right can be
exercised at any time occurring after
said taxes are imposed, through the
specified terms of the agreement.
29. Facility Name Live Nation has indicated that their [Not addressed in proposal]
management and promotion model
Change will require a name change for the
JGT. In order to implement this
change, the City Commission will
need to approve an amendment to
the City Code that will exempt the
JGT from the referendum
requirement for naming a City
facility. There is an accompanying
ordinance to effect this change.
The proposed name from Live
Nation is "The Fillmore Miami Beach
at the Jackie Gleason Theater.
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 14 of 16
Issues Identified at October 18. 2006 Commission Meeting
The City Administration and Live Nation are substantially in agreement. However, there are a
few items that were raised by the City Commission during the October 18, 2006 Special
Commission Meeting that were not accepted by Live Nation. While staff believes that the
resulting Agreement being discussed today is a fair agreement that appropriately represents
the proposal made by Live Nation, and is able to recommend the Agreement to you, it is
appropriate to identify items that you requested be raised, but were not accepted by Live
Nation.
1. Multiplier- The City Commission requested that the annual multiplier that increases
the annual "City Required Distribution" be increased from the Live Nation proposed
two (2%) percent to three (3%) percent. Live Nation has consistently advised the
City that their original proposal was very aggressive and that their business pro forma
does not support the increased risk that the one (1 %) percent increase in the annual
multiplier represents.
2. Property Taxes - The City Commission requested that if the Management Agreement
caused property taxes to be imposed, that Live Nation would evenly split the amount
of the property taxes with the City. Live Nation has consistently advised that their
business pro forma will absolutely not support the payment of any portion of potential
property taxes unless a corresponding deduction from the "City Required Distribution"
is permitted. The City's research and examination of Live Nation's operating pro
forma indicates support for this statement. The negotiated Agreement allows for the
City to opt out in the event that Property Taxes are imposed.
3. Termination Rights - The City Commission requested that "at will" termination rights
for the City be placed in the Agreement. Live Nation advised that they would
consider this only if the City provides Live Nation with a similar right and if the City
would be willing to commit to a termination payment that offsets their incurred costs,
which include both the $3.5 million capital upgrades cost and any losses due to
operation of the facility that were not projected to be recouped until later years. In the
opinion of staff, the economics of an "at will" termination right do not inure to the
City's benefit since it would require the City to forego the guaranteed income from
Live Nation.
4. Manage and Book the Byron-Carlyle and Colony Theaters - The City Commission
requested that management and booking of the Byron-Carlyle and Colony Theaters
be added to Live Nation's services. Live Nation declined to add these venues.
Finance and Citywide Proiects Committee
During a Finance and Citywide Projects Committee meeting, on May 9, 2007, the
Administration sought comments and guidance regarding the proposed Agreement.
Together, the Committee and the Administration discussed the key elements ofthe proposed
Management Agreement:
Under the recommendation of the Finance and Citywide Projects Committee, the
Administration has requested the following Amendments to the proposed Management
Agreement. These changes appear in the attached draft.
Commission Memorandum - Live Nation Management Agreement
May 16,2007
Page 15 of 16
. Initial Term
. Live Nation shall have no right of assignment
. Live Nation to have the right to negotiate for pre-purchase parking at the City's
standard rates as part of a VIP package for Live Nation to resell; however, a
separate Master Agreement, approved by City Commission is required.
. Specific acknowledgement in the Agreement regarding the proposed
improvements to the New World Symphony (NWS) site and JGT grounds
being renovated as part of the NWS contract. language clearly defining
"Events" when referenced in varying capacities (bonus, complementary
tickets, City and Charitable Uses, etc.)
· Termination Reimbursements- Live Nation to be reimbursed on unamortized
capital improvements, and City is not required to reimburse for certain
elements, such as the Sign.
· Prohibition against operating as a night club venue and limit on the sale of food
and alcohol to the closing of a concert/entertainment event and/or midnight.
· Specific reference to the "Front lawn" not being defined as part of the Facility
· language added to ensure annual inspections of the Facility
Conclusion
It should be noted that at the time of Agenda publication, Live Nation had not yet had the
opportunity to fully review, or agree/disagree with, these requested modifications. The
attached DRAFT Agreement has been provided to Live Nation for review over the next
several days. An update on these and any other outstanding issues will be provided in your
Supplemental package.
If approved, Live Nation intends to occupy and close the facility for renovations by the middle
of June 2007. Proposed improvements, as well as staffing efforts, will proceed through the
balance of the summer. Live Nation proposes to reopen the facility as the "Fillmore Miami
Beach at the Jackie Gleason Theater" this fall.
The Agreement represents an appropriate and fair agreement to the City, as well as one that
is consistent with, and improved upon, the original proposal. The Live Nation proposal will
provide a guaranteed return to the City of at least $1 million per year, whereas the facility
currently incurs an annual operating and capital deficit of $2.4 million. This represents a
significant shift in the operation of the facility as it will convert a facility that operates
significantly in the "red" to one that operates significantly in the "black". With property tax
reform a looming issue that faces the City moving into fiscal year 2008, this Agreement
represents a wholly appropriate and fiscally responsible action for the City to take.
In addition, and as noted above, the City's Resident and Business Survey shows that access
to additional live music and concerts is the highest rated cultural activity desired by our
residents and businesses. The proposed Agreement with Live Nation ideally meets and
addresses this perceived need. Live Nation, as the largest live music/concert promoter in
North America, will provide regular and active programming at the JGT. This will consist of a
variety of musical acts and concert performers, as well as comedy acts.
In closing, the proposed Agreement accomplishes a number of positive objectives of the
City. These include 1) remaking the JGT from a heavily subsidized operation to a one that
Commission Memorandum - Live Nation Management Agreement
May 16, 2007
Page 16 of 16
fully supports its operations, 2) providing a variety of live music/concerts and comedy acts to
our residents, and 3) it creates a complementary amenity to both the proposed New World
Symphony project and the recently completed Carnival Center. Of all of these positives,
perhaps the latter is the most significant, as it fills a desired need in the community without
competing with other wonderful cultural amenities.
Attachments
JMG/TH
T:\AGENDA\2007\may1607\Regular\Live Natian Mgmt Agreement Memo.doc
ATTACHMENT A
UPGRADES
All necessary work, labor, equipment and materials to complete a $3,500,000
renovation to the Jackie Gleason Theater. Projects will be completed on a priority
basis until achieving the $3,500,000 spending cap ("Cap"), after achieving the
Cap there shall be no obligation to perform any remaining work or items. All
costs shown include hard construction costs, soft costs, and furniture, fixtures
and equipment.
Priority 1
Modifications to the auditorium to convert to a live music use.
$1,400,000
· Remove all fixed seating between the cross aisle and the stage.
· Install three level platforms between the stage and center cross aisle.
· Include steps, ramps, and a low wall drink rail at each level change.
· Floor surface to be oak hardwood flooring.
· Floor structure to be metal studs and metal deck with a concrete topping with
a portable pit filler platform over the existing orchestra pit.
· Existing interior green drapery will be dyed red, including main traveler and
auditorium side wall curtains.
· Green balcony seat fabric will be replaced with red.
· Install (4) new glass and crystal chandeliers with blue pin spots.
Priority 2
Modifications to existing production audio and lighting systems
$400,000
· Replace existing speakers with a line array system.
· Augment the existing dimmer system with a new 24 channel board.
Priority 3
Modifications to main lobby and concessions
$500,000
· New main lobby flooring.
· Paint main lobby walls.
· Relocate Gleason artwork and add new live music posters and photos.
· Install new red drapery in main lobby.
· Install new glass and crystal chandelier with blue pin spots in main lobby.
· Add new walk-in cooler adjacent to the main lobby for beer storage.
· Add new beer system with three flavors of beer at each point of sale.
· Remove existing back bars and install new display coolers and beer taps.
· Update bar areas to accept new equipment as required. (ice bins/ speed
rails, reach-in coolers, soda guns)
· New POS system as required.
Priority 4
New exterior signage
$200,000
· Modify front marquee signage to have "THE FILLMORE" standup letters
above the existing marquee.
· Replace the existing rear building sign with "The Fillmore at the Jackie
Gleason Theater.
Priority 5
Balcony VIP box seating and VIP lounge
$400,000
· Replace existing seats in front of the balcony cross aisle with new larger high
back seats with cup holders.
· Create VIP lounge in balcony level lobby with new fixed bars and lounge
seating and tables.
Priority 6
Modify backstage dressing rooms, green room and catering kitchen
$250,000
· Create new catering kitchen adjacent to the existing loading dock behind the
practice room.
· Modify existing practice room decor to create a green room.
· Upgrade and combine 4 dressing rooms to create two larger dressing rooms
for touring acts.
Contingency
$350,000
ATTACHMENT B
.....
.c.
0 0 0 () s: U'I .I:lo W N ~ 0 ~
>I- 0 - m 0 - - - - -
s: =r c Q)
~ ~ 3 en en s: )> "'C r-
0 - (1) (") '< ::l Dr -. ..... EU
C/l ..., (1) (") c: < CD
- ^ * (1) c. 3 UI '< CD .....
(") ~ '< 0 -c -. UI UI ~
0 ..., 0 ::T 3
3 0 en s: ::T 0 "tj
3 g ~ =r 0 0 ~ c: CD
@ 0 0 :::I ., UI
N ~ < -. s: UI -. 0
0 C ::::J 0)' 0 0
0 C/l - en 0 - .....
-...j -. '< en s: 0 0
:r F 3 :S. 0
Q) c: c::
'< C"CD ~ CD :::I ......
G) l>> ::::J 0 UI UI 0 2'
-- -. CD
0 CD o' c 0 -.
c: ~::::J ..., :::I ::l Q1
'!=' OCD c- UI
~ 0 ......
-. Q, (1)
.., -. c: EU
:;J, J:2 ::::J m ., 0
(C c (") (")
::T -c :::t
Cii CD - =r
c (1) Q) S.
CD Q,Q,
CD CD en .,
<JJ ~ ~
(l) en!;
:2 2.0 UI
(l) ~
p.. !. 'C
-CD ....,
.., c::
l>> 0
~ ~ ~ ~ N Q:
(") ~ CJ1 0> ~ ():) 0 0 0 m co ...., '*'
ii
C/l )> ~
C/l
(") r- c::
!!. 3
~ 0
CI)
~ ~ w .....
0 ():) ():) ():) 0 0 co U'I U'I co ?fl- ::::-
~
CD
8'
I~ CI)
CD
~ ~ w ?fl- CD
VJ CJ1 VJ <0 <0 ....... ~ (0 w ~
3
0
I~ ca
~ ~ ~ N ?fl- 0
VJ ~ 0> 0 0 (0 (0 (0 m m .....
-.
~
:it
I~ CD
~ ~ N 0
CJ1 ~ ~ ~ ~ ....... (0 (0 m ....... ?fl-
-.
~
.'\)
~ ~ ~ ~ I~
~ ~ ~ VJ 0> W m .I:lo (0 (0 cfl.
~ ~ N N I~
~ CJ1 0> ~ CJ1 ....... U'I m ~ ~ cfl.
......
w
0 0 0 () s: (II ~ W N ....a. (') ~
- - - - -
>I- 0 ..... Q) 0 C C>>
3: :J =r :J 3 C/) CIJ 3: )> "'C r-
0 ,..+ CD ("') '< ::+ - -. ,.... Q)
Ul ..., CD CD ("') 3 c: D) < (I) ......
- ^ * c. en '< CD
(") :J '< 0 "C -. en en ~
0 ..., n :r 3
3 0 C/) s: :r 0 "'0
:E =r 0 0 :e c: CD
@ 3 g 0 0 ;j .., en
:E ~. -. 3: en -. 0
N n
0 c ::J CD n """"
0 Ul - C/) 0 -
...... -. '< C/) 3: n (')
:::c P 3 S. 0 c::
Q) :J c: CD ;j
'< C'~ en -
G) l>> ::J 0 en n ......
-- -. CD c::
.., CD o' c n -.
0 ;j ::+ Q1
c: ~::J ...,
"? o~ c- O en -
~ -. Q, CD c: Q)
.., -. Q)
.., .Q ::J .., (')
<5' C (") ("') "C ::t
::T ~ - =r
fii c CD D) S.
CD Q,Q, C/) ..,
(fJ ~ ~ ~ ~
CD en!; en
:2 2.0 ~
CD
!=l- !. 'tJ -f
-~
.., c::
~ ....a. ....a. ....a. ....a. N 0 ':::R. is:
(") ........ 01 C) ........ ex> 0 0 0 0) co -f 0
Dr ~
Ul )>
!!!. .... c::
(")
l>> :3
:E 0
tJ)
......
....a. ....a. ....a. N ::T :::-
C) C) w ex> ex> N 0) 0 co w -. ~ ~
....
(I) 0 CD
0'
OJ tJ)
- CD
....a. ....a. N D) CD
<0 01 01 <0 <0 co ~ ~ (II w 0 ?f!. :3
"
0
:I: ~
-. 0
....a. ....a. N en """"
ex> w ........ ~ ex> N co co co ~ ?f!. -.
D) ::3
;j S
-.
0 CD
)> 0
W ....a. W -.
....a. en ~
0 w 0 0 0 ...... 0 ...... ...... w -. ?f!.
D) .~
;j
0
-Jo. -Jo. -Jo. -Jo. ....a. ....a. ....a. N .... ?f!.
0 0 0 0 ~ 0 0 0) 0 ....a. ::T
(I)
..,
...
w
.....
ll-
s: 0 0 0 (j) () U'I ~ W N ....a. ~
-0 0 ..... D) '< 0 - - - - -
o 0 ::J :::r ::J 3 3 3: 3: )> "'C r-
.... - CD
Dl n ..+ (") "C CD C C ;:l Dr <' ~
:s 0 ^ "1- CD :::r a. t/) !!!. '< CD .....
'< 3 0 '< -. t/) t/) ~
::J n n ;:j 3
~3 0 ::J CJ) 0 "b
:s 0 :E (") :::r 0 0 c
@ Q.:s 0 .., .., ~ t/) (I)
-- 3 t/) -.
N -'< :E 3: 3: n 0
0 ~3 c ......
0 CJ) 0 0 -
..... CJ) n (')
-(1) :S. :S. 0
J: -. :s (") c::
Ql :s_ CD CD ~
'< n -. ~
G) -0 t/) t/) n
a c: :s -. -. CD
Q.(1) ~ ~ ;:l Q1
c: (1)Q.
'!=J n -. 0 0 t/) ......
~ ::r:S C C ~
-. n
~, S::E' .., .., (')
<.0
:::r ., Q. "C tr :::t
1ii (1) (1) Q) CD S.
PQ.
iil ~ 3 .., Q)
(Jl ~ n ~
CD t/) ;:j
< 'C 0
CD o ., CD ~
p.. o (1) t/) -I
~....
., Dl c::
Dl 3 ....a. ....a. ....a. N 0 Q:
Q. -. ~
(1) - 0) ""'-J ~ 0) ""'-J co W w 0') (0 -I
'< 0
o Dl )> ~
::rn
o _ r- c::
=e <'
0;::;: :3
ar
0 0
Ct)
I~ .....
....a. ....a. ....a. W ::::-
w 0) ~ ""'-J <0 N 0') ....a. N ~ ~ ~
0 (I)
a-
Ct)
I~ (I)
~ ....a. ....a. (I)
""'-J <0 I\.) W 01 (0 (0 (0 co (0 ?Ie :3
0
~
I~ 0
....a. ....a. ....a. N ......
""'-J 0) ~ ~ 0) co N ~ U'I ....., ~ .... .
0 ~
S
(I)
0
.... .
~
.'\)
Page 1 of2
Aguila, Raul
From:
Sent:
To:
Aguila, Raul
Friday, May 11, 2007 6:38 PM
Smith, Jose; Gonzalez, Jorge; Hemstreet, Tim; Fernandez, Hilda; Walker, Patricia; Sklar, Max;
Cc:
Subject:
Tucker, James; 'Eskowitz, Bruce'
LIVE NATION MANAGEMENT AGREEMENT/ ADDITIONAL COMMENTS TO 5/11/07 Draft
(ITEM R7E)
Importance: High
Pursuant to my initial review of the 5/11/07 Draft, the following items also need be revised and/or incorporated:
1, Section 2.1 (b )-- the last paragraph needs to reference that Live Nation also acknowledges that there may be
disruption caused by construction of improvements on JGT front lawn (as part of City improvements in
conjunction with the New World Symphony Project).
2. Section 2,1 (b )-- the last sentence of the first paragraph should be revised as follows: "Without limiting the
generality of the foregoing, in no event shall the Facility be operated as a night club nor may food or beverages be
sold after midnight."
3. Section 2.5(b)--add the following last sentence to (b): Within one year from the Commencement Date, the City
and Live Nation shall negotiate in good faith and finalize the terms and conditions of a Parking Agreement,which
will set forth the process and the parties' respective rights and obligations regarding requests by Live Nation, and
consideration by the City Manager, for prepurchase of valet spaces and/or self parking spaces, and said Parking
Agreement (and any subsequent amendments thereto) shall be approved by the City Commission prior to
implementation of same,"
4, Section 3 should be rewritten as follows:
3, Term and Renewal Term.
3,1. Term - The "Term" of this Agreement shall commence on , 2007 ("Commencement
Date") and end at midnight on , 2022 ("Expiration Date"), unless earlier terminated pursuant to the
provisions of this Agreement. City shall instruct the current manager of the Facility to cooperate and assist Live
Nation in effecting a smooth transition of the management of the Facility (but Live Nation recognizes that the
management agreement with current manager will not expire until sixty (60) days after notice of termination is
provided by City). No costs, fees, or expenses of City under the current management agreement shall be
included in Operating Expenses.
3,1.1 Adjustment to Required City Distribution. The Required City Distribution beginning in Year 11 of the
Agreement shall mean the annual Required City Distribution in effect during the last Fiscal Year (or partial Fiscal
Year) of the initial 1 0 years of the Term multiplied by a fraction, the numerator of which is the CPI in effect for
June 2022 and the denominator of which is the CPI in effect for June 2007. The Parties recognize that the
Required City Distribution for the last year of the initial 10 years will already reflect a 2% per annum increase in
the Required City Distribution in effect at the Commencement Date and they fully intend that such amount be
increased by the cumulative increase in the cost of living that occurred over the initial 10 years.
3.2. Renewal Option. Live Nation shall have the option to extend this Agreement for a period five (5) years
following the Expiration Date ("Renewal Term") provided that all of the following conditions are met:
(i) not less than 270 days nor more than 365 days prior to the Expiration Date of
this Agreement, Live Nation shall provide written notice to City ("Exercise
Notice") stating that Live Nation desires to exercise the renewal option. Time
shall be of the essence with respect to the Exercise Notice and if Live Nation fails
to provide written notice as and when required, the renewal option shall expire
05/1112007
Page 2 of2
and shall not thereafter be exercisable;
(ii) both at the time Live Nation delivers its Exercise Notice and at the time the
Renewal Term would otherwise commence, Live Nation shall not be in default
under this Agreement and no condition shall exist which, with the giving of notice
or the passage of time, would constitute a default; and
(iii) City Commission determines that Live Nation has operated, managed,
maintained, promoted and marketed the Facility throughout the Term in a
manner consistent with other first class managers of similar first class facilities
and further, agrees to the renewal.
In the event the conditions of (i), (ii) and (iii) are not met, then and in that event this Agreement shall expire
at the end of the initial Term (Le., on the originally stated Expiration Date) and the provisions of Section 13.1 shall
apply.
If, however, all conditions of (i), (ii) and (iii) are met, then and in that event this Agreement shall be
renewed on all of the same terms and conditions, except that the City shall have the right to re-negotiate the
Required City Distribution for the Renewal Term. If the City and Live Nation are unable to negotiate and agree
upon the Required City Distribution for the Renewal Term then, in such event, this Agreement shall expire at the
end of the initial Term.
As used herein "CPI" means the consumer price index for all urban consumers. South Florida Area
Average, all items (1982-1984 = 1 00) issued by the United States Department of Labor, bureau of Labor
Statistics, but if such index is discontinued, a comparable index that measures increases in the cost of living shall
be substituted.
3.3. Live Nation's Early Termination. Notwithstanding anything to the contrary contained in this
Agreement, Live Nation shall have the right to terminate this Agreement upon either of the following occurrences:
(a) if by December 31, 2007 City has not done one of the following: (i) caused the existing resort tax bonds to be
defeased so that the Facility is no longer security for such bonds; or (ii) obtained the unqualified opinion (issued to
both City and Live Nation) of the City's bond counsel that this Agreement does not violate the bond obligations
and, therefore, defeasance is not required; or (b) City Commission has not changed the name of the Facility to
include "Filmore" by December 31, 2007. If either (a) or (b) occurs but Live Nation does not give written notice of
termination on or before January 31, 2008, Live Nation shall irrevocably be deemed to have waived its option to
terminate and the provisions of this Section 3.3 shall be void. If Live Nation timely exercises its right of
termination, this Agreement shall be terminated as of January 31, 2008 and the provisions of Section 13.1 shall
apply,
5. Section 5.2 (b) -- the "Termination Payment" should be revised from $3,500,000 to $3,300,000 (Le,
the new amount does not include calculation of the cost of the exterior signage upgrade, in the amount of
$200,000). Additionally the word "Term" should be deleted from the next to last line.
6. It should also be noted, to be discussed further at our conference call on Monday, that Commissioner
Libbin had requested at the 5/9/07 Finance and Citywide Projects Committee Meeting that Live Nation consider
making a voluntary AIPP contribution (based upon a percentage of the cost of the Upgrades),
05/11/2007
FOR THE JACKIE G
MANAGEMENT AG
THE CITY OF MIAM
FLORIDA
QRLDWIDE, INC.
TH A TER OF THE PERFORMING ARTS
MIA#2609877 .1
6.
7.
8.
9.
10.
TABLE OF CONTENTS
Pa2e
1.
2.
Definitions...................................................................................................................... 1
Engagement of Live Nation; Scope of Services ............................................ ...................4
2.1 Engagement........................................................................................................ 4
2.2 Scope of Services................................................................................................ 5
2.3 Specific Services ............................... ........................... ......................... .......... .... 6
2.4 City and Charitable Use of Facility and Ticket Programs..................................... 9
2.5 Rights Reserved to City................................................................",.., ...".,......15
Term and Renewal Term.......................... .......................................",...... "".. ....",... 16
3.1 Term ................................................................................."...........",...... ",..... 16
3.2 Renewal OPtion..................................................................~...... ............... 17
3.3 Live Nation's Early Termination........................................ ........ ..............18
Live Nation's Compensation; City Distributions ...............~............ ......, ...............18
4.1 Management Fee ................................"",.... .... ....... .. ........ .......................... 18
4.2 Required City Distribution........................................... ............................... 19
4.3 . Excess City Distribution..,..,..".",. ':............ t~"" '...,.... .... .... ..... ..... ...............19
Fundmg; Budgets; Bank Accounts; AlteratIons "~' '.......... .""""................................20
5.1 Live Nation FUnding. Guaranty...... ....,",..............."""........,.,........", ........... 20
5.2 Non-Funding by City................... ...... ........................... ........................ 20
5.3 Receipts and Disbursements.......... .. .. .....................................................21
5.4 Alterations..........................,.."""",............,.".." ........................................21
Records, Audits and Reports. ... .................. , , , .......................................................... 23
6.1 Records and Audit .......... ........ , .. , , , ............................................................ 23
6.2 Annual Plan..... .................... ..,'"................""",. ........................................ 24
3.
4.
5.
,..,.....................................................................................24
ership of Assets..................................................................................................... 27
Ownership......................................................................................................... 27
City Obligations...................................................... ..........................................28
Assignment; Affiliates.................................................................................................. 28
10.1 Assignment....................................................................................................... 28
10.2 Live Nation Affiliates........................................................................................ 29
(i)
live nation management agreement (5-11-07).doc
13.
14.
16.
TABLE OF CONTENTS
(continued)
11.
Pa2e
Laws and Permits.......................................................................................................... 29
11.1 Permits, Licenses, Taxes and Liens ...................................................................29
11.2 Governmental Compliance................................................................................ 29
11.3 No Discrimination in Employment; Affirmative Action ....................................30
Event of Default and Remedies .....................................................................................30
12.1 Live Nation's Defaults...................................................................................... 30
12.2 City's Remedies............................ ....................................."",.... 'r\'" ,............31
12.3 Right of City to Perform............................................................... ...,........... 31
12.4 City's Defaults........................................................................."". ...."" ........32
12.5 Live Nation's Remedies .............................................,."".,. ..... ......".......,32
12.6 Late Payments.................................................................~... ........ ......... ..... 32
Termination.................................... ........................ ....................." ,.... ,.....""...... 32
13.1 Effect of Termination .................................""""... ......"".......""".......",.....32
13.2 Surrender of Premises .................................,.".",....... ...."",.. .......... ............. 33
Net Worth Requirement; Security..........................~,. ...............",........, .................. 33
14.1. Net Worth Requirement ..."..",."",.. ........ ....."., ..............", .......................... 33
14.2 . Security................................. ... , , , , , , , , ...... .... .. , , , , , , . ........... , , . . .. ...... , , ..............33
Miscellaneous................................, , , , . , , . , , .. " , , ,............................................... 34
16.1 Venue/Waiver of Jury Trial....................... ....................................................... 34
16.2 No Partnership or Joint V re ............. ........................................................35
16.3 Entire Agreement........ . . . . . . . . . , . . , . , , , , , , . . , . . . . . . . . . . . , . , , , , , , , . . , . . . . .. .. .. ... .. .. .. .. .. .. .. .. .. .. . 35
16.4 Written Amendme t ....... ............,""',......................................................... 3 5
16.5 Force Majeure.., ................. .....................................................................35
16.6 Binding Upo rs and ssigns; No Third Party Beneficiaries................ 36
16.7 Notices...........,.... ,.."""", ................................... .................. ......................... 36
16.8 Section eadings a med Terms................................................................ 37
16.9 Severabi ........ ................ ....................................................................... 37
16.10 Non- W ai ......,"',....,................................................................................. 3 7
16.11 'n Re esentations and Warranties ............................................................37
16.1 ing r..; .................................................... .............................................38
12.
LEGAL DESCRIPTION OF THE FACILITY
CITY WORK
UPGRADES TO BE MADE BY LIVE NATION
MINIMUM MAINTENANCE STANDARDS
LIST OF CITY AGREEMENTS
PENDING BOOKINGS
(ii)
live nation management agreement (5-11-07),doc
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (this "Agreement") is dated as of the _ day
of , 2007 ("Effective Date"), by and between the CITY OF MIAMI BEACH, 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 LIVE NATION WORLDWIDE, INC., a Delaware corporation, whose address is
9348 Civic Center Drive, Beverly Hills, California 90210 ("Live Nation").
BACKGROUND
City is the owner of the Jackie Gleason Theater of the P o~s, a more
particularly described and depicted on Exhibit "A" attached hereto and :~ hereof (the
Live Nation is engaged in the business of operating, main~, m~ ging and booking
::~:c:::~~:~::df:i::e:,i::~:~:~~::~:::ark. S~~~SUCh fucilities
City desires to engage Live Nation, and Live Na~n des to accept the engagement, to
provide management services for the Facility on terms d con Ions set forth herein.
NOW, THEREFORE, in consideratio e utual premises, covenants and
agreements herein contained, the parties h to, intending 0 be legally bound, agree as follows:
greement, the following terms have the meanings
1. Defmitions. For purposes
referred to in this Section 1:
ctly indirectly, through one or more intermediaries,
er common control with, a specified person. For purposes
rship of equity securities or other ownership interests
voting power in the controlled person.
. n this first paragraph of this Agreement.
the governing and legislative body of the City.
re ents" -- those existing agreements between the City and a third party
cihty that are listed on Exhibit "E."
ana er" -- the chief executive officer of the City or such person as may from
time to ti e be authorized in writing by such administrative official to act for him/her with
respect to any or all matters pertaining to this Agreement.
"City Work" -- the work to be performed by City at its sole cost and expense described in
Exhibit "B" hereto, which City Work will be performed by City in accordance with
Section 5.4(b)(ii).
"Commencement Date" - as defined in Section 3.1.
"Event" -- all uses which involve a scheduled beginning and ending time, typically all
within the same day (or for evening Events, typically commencing in the evening and concluding
before dawn of the succeeding day). With respect to a "Run" (as such term is hereafter defined),
each show within the Run shall constitute an Event.
"Event Expenses" -- any and all expenses incurred or payments made by Live Nation in
connection with the occurrence of an Event at the Facility, including, but not limited to, costs for
event staffing including ushers, ticket takers, security and other event staff, and cos relating to
setup and cleanup.
"Excess City Distribution" -- as defined in Section 4.3.
"Expiration Date" - as defined in Section 3.1.
"Facility" -- as defmed in the Background Section of this
Exhibit" A" hereto.
"Fiscal Year" -- each one year period beginning Ja 1 and en
"Governmental Requirements" - all laws, ord~' ces, , regulations, statutes, and
other legal requirements of any governmental bo r auth 'ty or y agency thereof (including,
without limitation, federal, state, county, and mun .
paragraph this Agreement.
, -- any and all expenses and expenditures of whatever kind or
. directly, by Live Nation in promoting, operating, maintaining,
acility, including, but not limited to: employee compensation and
e salaries, bonuses, severance and car allowances), employee benefits
s relocation and other related expenses pursuant to Live Nation's relocation
nd/other fringe benefits), supplies, material and parts costs, costs of any interns
ende contractors, advertising, all costs of maintaining the Facility as required by this
Agreeme arketing and public relations costs and commissions, janitorial and cleaning
expenses, ata processing costs, dues, subscriptions and membership costs, amounts expended to
procure and maintain permits and licenses, sales taxes imposed upon ticket sales or rentals,
special assessments imposed upon the Facility by any governmental entity, professional fees
directly relating to the operation of the Facility, printing and stationery costs, Event Expenses,
postage and freight costs, equipment rental costs, computer equipment leases and line charges,
telephone switch and telecommunications services, repairs and maintenance costs (e.g., elevators
and HV AC), artist and talent fees, costs, and expenses, show settlement charges, security
expenses, travel and entertainment expenses in accordance with Live Nation's normal policies,
-- with spect to a Fiscal Year, the excess, if any, of
over Operating Revenues for such Fiscal Year, in the
Operating Revenues for such Fiscal Year over Operating
se of a profit.
- 2 -
live nation management agreement (5-11-07).doc
the cost of employee uniforms, safety and medical expenses, exterminator and waste disposal
costs, costs relating to the maintenance of signage inventory and systems, the cost of compliance
with Governmental Requirements, all utility costs, all premiums for insurance carried by Live
Nation pursued to Sections 8.2, 8.3 and 8.4, the cost of capital improvements made pursuant to
Section 5.4 (except, however, the cost of Upgrades or capital improvements made pursuant to
Section 5.4(b)(i), the cost of which shall be paid by Live Nation from its own funds, and except
the cost of City Work made pursuant to Section 5.4(b)(ii), the cost of which shall be paid by City
from its own funds), the cost of all personal property and equipment (other than U rades), and
the internal service charges assessed by the City to the Facility (which shall be fa' equitable)
for sewer charges and chilled water charges and other services, and all other c ts 0 perating
and maintaining the Facility, except, however, Operating Expenses s ot inc de the
following: the Management Fee or any Bonus paid pursuant to Section .1 he c ofU rades
or City Work, ad valorem real estate taxes, cost to remedy any violati s . stin rior to the
Commencement Date of Governmental Requirements (other than Up ra d any tax
imposed by the City upon ticket sales that applies solely to the 'lity a not to other ticket
sales (other than any such taxes that relate to the Community Be t Fu ) or any costs of
litigation between Live Nation and City, All Operati xpenses 11 be determined in
accordance with generally accepted accounting prinCiPI~. c.on entlya lied and recognized on
a full accrual basis.
"Operating Revenues" -- any and all re e 0 very kind or nature derived from
operating, managing or promoting the Facility, c u g, but not limited to: license and
concession fees, rentals, revenues from handise sal , advertising sales, equipment rentals,
box office revenues, food service a concession r enues (however, if such revenues are
collected in the first instance by a re ed by the concessionaire, only the amount of such
revenues paid by the concessio to the ci ity shall be included as Operating Revenues),
commissions or other revenu fro decorat n and set-up, security and other subcontractors
(however, if such revenues 0 ected in the first instance by and retained by such
subcontractors, only the amount 0 h revenues paid by such contractors to the Facility shall be
included as Operating es), In ellaneous operating revenues, revenues generated from
separate agreements with iv: . n Affiliates pertaining to the Facility, sponsorship revenues,
and interest re es, al as d ermined in accordance with generally accepted accounting
principles an ec ized 0 full accrual basis. For the sake of clarity, the parties acknowledge
that revenu s of tickets for Events at the Facility are not Operating Revenues, but
are inst ve of t e promoter and/or performer of each such Event. To the extent that
Liv ation lec uch ticket sale revenue on behalf of a promoter and/or performer, such
ti ale re ue shall be the source of funds from which Live Nation collects the rental
charge doer event reimbursements owed by the promoter and/or performer for use of the
Facility, such charges and reimbursements are Operating Revenues hereunder. Operating
Revenues hall not, however, include any revenue from valet parking or any other parking
charges with respect to the Facility or Events and shall not include any revenues from naming or
signage rights, all of which are specifically reserved to City.
"Renewal Term" - as defined in Section 3.1.
- 3 -
live nation management agreement (5-11-07).doc
"Required City Distribution" -- the following amounts shall be deemed Required City
Distributions: Required City Distributions for a Renewal Term shall be determined pursuant to
Section 3.2.
(i) for the period commencing with the Commencement Date and continuing
through December 31,2007, the sum of$583,334;
(ii) for the Fiscal Year commencing January 1, 2008, the sum of $1,020,000;
and
(iii) for the Fiscal Year commencing January 1, 2009 ach Fi al Year
thereafter for the remainder of the Term, the Required City Distribution sh I be mou equal
to the product of 1.02 multiplied by the Required City Distribution in~ for e preceding
Fiscal Year.
Required City Distributions shall be paid to City in ad' on ~ first day of each
Fiscal Year or partial Fiscal Y ear. ~
"Run" - as defined in Section 2A(b).
2.
"Term" - as defined in Section 3.1.
"Upgrades" -- the work to be
Section 5 A(b )(i) at the sole cost and exp
listed on Exhibit "C" hereto.
ive Nation in accordance with
n and not as an Operating Expense as
2.1. Engagement.
(a)
maintain, promote and
hereinafter set fo
City hereby engages Live Nation to operate, manage,
acility during the Term, upon the terms and conditions
an er of the F acilit . Live Nation accepts the engagement and agrees
main, promote and market the Facility in a manner consistent with other
ss . 'ties operated by Live Nation, Subject to the terms of this Agreement,
ation sib, as agent for the City, the sole and exclusive manager of the City to operate,
aint n, promote and market the Facility during the Term. In such capacity, except as
otherwis essly reserved under this Agreement to the City and/or except for such matters as
are subjec 0 the approval of City or City Manager, Live Nation shall have exclusive authority
over the management and operation of the Facility and all activities therein; provided, however,
the Facility shall be used only as a live entertainment venue and public auditorium or any
combination thereof, and for such ancillary uses as are customarily related to such primary use,
including, without limitation, broadcasting, recording, filming, private parties or functions, bar
(including alcoholic beverages) and food concessions (and including preparation of food), in
each case in conjunction with an Event then being held, and sale of merchandise related to any
Event then being held. Other uses may be allowed only with the prior written approval of the
- 4-
live nation management agreement (5-11-07).doc
City Manager. In any event, however, no Events or other uses shall be permitted that present
unreasonable safety concerns or are inappropriate for similar facilities owned by governmental
entities. Without limiting the generality of the foregoing, in no event shall the Facility be
operated as a night club nor may food or beverages be sold prior to after the conclusion of an
Event.
Scope of Services.
(a) General. Live Nation shall perform and 'sh m agement services,
personnel, and systems and materials as are appropriat or neces to operate, manage,
supervise, maintain, promote and market the Facility i a r consis t with the operations,
management, promotions and marketing of other simil first- ss facilities operated by Live
Nation on the Effective Date.
) . Booking Policies. In booking the Facility, Live Nation will use such
as are used by Live Nation as ofthe Commencement Date at other similar first-
e perated by Live Nation, subject to the restrictions and limitations set forth herein.
Except as erwise provided herein, Live Nation shall have the sole authority to approve the
scheduling of any Event in the Facility, including, Events of a nontraditional nature such as
multi-year user contracts (but not beyond the Term and, if applicable, the Renewal Term) and
Events requiring or having co-promotions. Live Nation covenants and agrees to book Events
each Fiscal Year that are balanced so as to ensure a reasonably proportioned blend of cultural
experiences including varied types of music and other live performances appealing to the varied
tastes of the population including, without limitation, popular, rock and roll, Latin, blues, soul,
jazz, folk, classical, and country music, and comedy and theater. Live Nation shall have no
(b) Re uired Number of Event u sO eration. In order to ensure the
continuous operation of the Facility, co encing with he Fiscal Year that starts January of
2008 Live Nation shall cause at least 5 ents to b d at the Facility for each Fiscal Year
(and proportionately for any partial E' c ear) during the Term and any Renewal Term, if any.
The aforesaid fifty (50) Events sh e ca ted by counting each separate Event in a Run but
Live Nation agrees that in Fisc e r 2008 a ach Fiscal Year thereafter there will be not less
than 17 separate categories d fo purposes of calculating whether this requirement
has been met, each Run shall b nsidered only as a single category of performance). Live
ility to open on a year round basis, subject to closures for
ance and alterations. Notwithstanding the foregoing, Live
ase perations at the Facility in whole or in part during the period
te through December 31, 2009 for periods necessary to perform the
required Events shall be proportionately reduced for the period(s)
- 5 -
live nation management agreement (5-11-07),doc
obligation, however, to book any type or category of Events or specific Event that are
unprofitable, as reasonably determined by Live Nation. City Manager shall have the right,
however, to prohibit certain Events or uses from occurring, upon City Manager's reasonable
determination that such Event or use might present unreasonable safety concerns or is
inappropriate for similar facilities owned by governmental entities. Notice of any such
determination shall be sent by written notice to Live Nation within fourteen (14) days after City
Manager has been advised in writing by Live Nation of the potential Event and if such
determination is not delivered within such fourteen (14) day period, then the Event ay be held,
Live Nation shall use good faith efforts to accommodate the Miami Beach Co 'on Center
and the Greater Miami Convention and Visitors Bureau to allow them to boo the e of the
Facility in accordance with the following: (i) reservations for rotation ventio, trade
shows and meeting business may be made by the Miami Beach Conv nt n C r an or the
Greater Miami Convention and Visitors Bureau up to sixty (60) mont . r to n Event or
intended use, (ii) reservations must be confirmed at least twelve (1 before the
scheduled Event, (iii) such reservation can not be in confli ith ther Event already
scheduled or on a "hold" by Live Nation, (iv) such Event can not 1.) fad ation in excess of
two (2) consecutive days, and (v) the Miami Beach Conve Center r the Greater Miami
Convention and Visitors Bureau, as applicable, execute ive ion's st dard rental agreement
for Events.
Attached hereto as Exhibit "E" is a list of v or ntals which have been booked prior
to the date of execution of this Agreement. Live Ion a honor all such bookings and shall
receive from City all revenues from the a ments that ve already been paid and shall receive
all remaining revenues under the agree ts.
'ting the generality of the foregoing, Live Nation
rvices, without the necessity of first obtaining City's
s ly provided in this Agreement), all of which shall be
r consistent with other similar first class facilities operated
ate:
(a
booking poli .
rental or u
master s
subJ to e terms and requirements of this Agreement, establish all
cont I the booking of the Facility, including, determining the form of
to used for the use or rental of the Facility. Live Nation shall hold the
n ecords and schedules and shall provide copies thereof to City Manager
er times as City Manager shall request. Live Nation shall, from time to
bo 'ng policies and advise the City Manager of changes, if any, in the booking
e Nation shall consider any requests or suggestions made by City or City
(b) employ, supervise and direct all employees and personnel consistent with
the provisions ofthis Agreement. All employees shall be employees of Live Nation, its affiliates
or third parties, and not City. Live Nation shall assure that the Facility is adequately staffed with
competent, qualified personnel to fulfill its responsibilities under this Agreement;
( c) administer relationships with all third parties (including, without
limitation, entering into contracts and licenses for the food and beverage concessionaire at the
- 6 -
live nation management agreement (5-11-07).doc
Facility) for the use, maintenance and operation of the Facility, initiate and participate in any and
all negotiations, renewals and extensions relating to such third party relationships, and enforce
contractual agreements concerning any such third party relationships;
(d) negotiate, execute in its name as agent for the City, deliver and administer
any and all licenses, occupancy agreements, sponsorship agreements (excluding naming rights
and valet parking agreements), rental agreements, booking commitments, concession
agreements, supplier agreements, service contracts (including, without limitation, ontracts for
cleaning, decorating and set-up, emergency services, general maintenance and nance and
inspection of HV AC and other systems and elevators, stage equipment, fire c trol anel and
other safety equipment, staffing and personnel needs, including guards a ers, t phone,
extermination and other services which are necessary or appropriate) d ontr ts and
agreements in connection with the management, maintenance, promotI tion of the
Facility, provided that (1) if any such license, agreement, commitment or a term that
extends beyond the remaining Term or Renewal Term, as t ase m be, such license,
agreement, commitment or contract shall provide that it is automat ly as . ned to City as of
the expiration or termination date of this Agreement and t the Cit ager may terminate
any such agreement without payment thereafter at an tim on not ess than ten (10) days
written notice, (2) Live Nation shall have the sole aut rity t ove the scheduling of any
Event to be held at the Facility, subject to the Ii ation and re Irements of this Agreement,
and (3) any contract entered into between Live ti d subsidiary and/or affiliate company
shall be at terms and for prices customarily charg y h ubsidiary and/or affiliate company
for comparable goods and services elsew at rates that e competitive within the industry;
( e) maintain the (including, without limitation, all structural
components thereof and all ele C, life safety, mechanical, plumbing and other
systems and equipment) in ood, safe an clean condition and in compliance with all
Governmental Requirements, c with other similar first class facilities, ordinary wear and
tear, and casualty loss excepted; p 'ded, however, that any disrepair that reasonably could have
been avoided by norma ntative aintenance shall not be considered normal wear and tear,
Maintenance responsibili de, without limitation, repairs and replacements (structural,
nonstructural c . al an on ital) and preventative maintenance and compliance with
Exhibit "D" e Live ion shall maintain in full force and effect service contracts with
qualified a e providers with respect to HV AC, roof and elevator systems unless
Live N . strates to City Manager's satisfaction that Live Nation has sufficient trained
and a I Ie s to maintain such systems and that any warranties will not be voided as a
ereof.
ation shall keep on-site maintenance manuals and records reflecting all of Live
Nation's mtenance activities, all of which shall be available for inspection by City Manager or
his designee upon request. Live Nation shall submit to City Manager or his/her designee
periodic (not less than quarterly) reports specifying all maintenance work performed during such
period, which reports shall be used by the City's Property Management Division or its consultant
as part of an annual maintenance inspection and review.
Live Nation represents and agrees that prior to the Effective Date Live Nation inspected
the Facility and Live Nation has accepted the Facility "as-is, where-is and with all faults" and,
-7 -
live nation management agreement (5-11-07),doc
except for the City Work, City shall have no obligation to perform any repairs or other work with
respect to the Facility.
(f) rent, lease, or purchase all equipment and maintenance supplies necessary
or appropriate for the operation and maintenance of the Facility;
(h) pay when due, on behalf of the City, all 0
accounts established pursuant to Section 5,3 or from Live Nation's
Section 5.1 ;
(i) after consultation with the City
subject to approval by the City Attorney or his designe
of which shall be included as Operating Expenses, such
appropriate in connection with the operation of the acili
City Attorney), including, without limitation, to llect c ges, rents or other revenues due to
the City or to cancel, terminate or sue for dam er, any license, use, advertisement or
concession agreement for the breach t reof or defa t thereunder by any licensee, user,
advertiser, or concessionaire at the Fac' y, Institute Live Nation's own behalf (and not as
agent for City) without consultation oval of the City, the costs of which shall be included
as Operating Expenses, such lega c' ons roceedings necessary or appropriate in connection
with the operation of the Facili , in luding, out limitation, to collect charges, rents or other
revenues due to the City or N n or t cancel, terminate or sue for damages under, any
license, use, advertisement or co sion agreement for the breach thereof or default thereunder
by any licensee, user, a iser, or ssionaire at the Facility;
(j)
(which shall b
n a aster set of all booking records and schedules for the Facility
inspection by City Manager upon written request);
de day-to-day administrative services in support of its management
a the Facility shall be operated, managed, and maintained and performed in
er d in any event consistent with similar first class facilities operated by Live
s of t Commencement Date including, but not limited to, acquisition of services,
pplies and facilities; maintenance and property management; personnel
, record-keeping; collections and billing; and similar services;
(1) engage in advertising, solicitation, and promotional activities necessary to
effectively market the Facility and Events. In connection with its activities under the terms of
this Agreement, Live Nation will be permitted to use the logo and brand identity of the City of
Miami Beach, as approved by the City Manager or his designee, and the Facility;
(m) operate the Facility's telephone switch and telecommunications services;
- 8 -
live nation management agreement (5-11-07).doc
(n) act as a collection agent for the City on sales taxes from operation of the
Facility and remit to the State of Florida such sales taxes;
(0) cause the Facility to be in compliance with all Governmental
Requirements at all times including, without limitation, making such repairs, improvements,
alterations and additions (both capital and non-capital and structural and non-structural) required
thereby;
(p) comply with all City Agreements;
(q) Except as otherwise approved by the City Manager, ation hall not
license or allow the use of any portion of the Facility to other than short-te us i.e., s than
ten (10) consecutive days). Live Nation shall require that all users~e Fa ity provide
certificates of insurance evidencing appropriate insurance and any othe . n ce equired by
the applicable license, use or occupancy agreement. Copies these certi lcates shall be
furnished to the City Manager or his/her designee prior to any Even use. uch insurance shall
be kept in force at all times by all licensees, users, lesse and con i naires. All liability
policies shall name the City and Live Nation as add' io a . sureds. ive Nation shall also
require all users of Facility to execute, among the term f the nse, agreement or occupancy
agreement, an agreement to indemnify, defend a hol harmle the City (the form of such
provisions or agreement to be subject to City ttorney approval, not to be unreasonably
withheld).
) ree City Use. City shall be entitled on two (2) occasions in each full
proportionately for any partial Fiscal Year) during the Term and any Renewal
ect the terms and conditions hereof, to make use of the Facility for hosting an Event
of one (1 ay or one (1) evening, in each case expressly subject to the provisions of this
subparagr ph (a) (such instance(s) of use by City is herein referred to as "City Use"). Although
City shall not owe a fee, rent or other payment strictly for the right to make such City Use,
nonetheless (i) City shall promptly (within ten (10) business days after receipt of written invoice
therefor), reimburse Live Nation for all actual expenses and costs incurred by Live Nation to
facilitate City Use, including, without limitation, a fair allocation toward janitorial, clean up,
crowd and traffic control, set-up and tear-down costs and fees and charges (including for
materials, labor and other services) directly necessitated by the occurrence of City Use; (ii) Live
(r) provide professi a
respecting City's booking and progr
terms hereof (herein, the "Byron/
Byron/Colony Assistance shal e r
shall not include any oblig
development, sales, programmin
any asserted failure of s onsulti
consultin sistance to City from time to time
for the "Byron" and "Colony" venues, subject to the
y . tance"). Live Nation's requirement to provide the
ited to sonable consulting services only and expressly
promo ing, operating, maintaining, managing, business
booking, and expressly shall not include any liability for
rvices to meet any required standard or frequency.
(s)
with respect to
uled Major Events Planning (MEP) meetings and cooperate
urity issues.
ritable Use ofFacilit and Ticket Pro rams.
- 9-
live nation management agreement (5-11-07).doc
Nation shall retain exclusive rights to the operation of all concessions and other operations at the
Facility during City Use, including, without limitation, food and beverage concessions and sales,
including alcoholic beverages (but City Manager shall have the right to prohibit the sale of
alcoholic beverages for any City Use); and all proceeds of such sales and concession operations
shall be Operating Revenues. City shall have no right to reserve or retain any portion of the
concession proceeds nor to operate in competition therewith. Live Nation will ensure that the
pricing for any concessions shall not exceed the normal pricing therefor charged at standard
Events at the Facility; (iii) all City Use Events shall be scheduled in accordan with Live
Nation's scheduling needs so as not to conflict with or impair Live Nation's ab' . maintain
its anticipated schedule of Events, but shall otherwise be scheduled at times con nie for City,
with Live Nation reasonably cooperating with City in coordinating all s 'ng (b in any
case, Live Nation shall not be obligated to permit any City Use unless sc duh there r was
memorialized in writing signed by the parties in advance of any City Us; Cit hall not be
permitted to have a City Use for a concert or that violates the te s of a s hip entered
into by Live Nation (for purposes of this sentence, a "concert" th so pro 'bited shall not refer
to "amateur talent" as defined below); and (v) City's entering int stan rd use agreement
approved by both Live Nation and City, So long as 'ye Natio complied with its
obligations under this subparagraph (a), City shall n t e titled t "roll over" or "carry
forward" any unused City Use opportunity from a pri Fisca ; such that if during any
Fiscal Year fewer than two (2) City Uses actual ccur r any ason, including reasons that
were completely outside the parties' reasonable c e City shall be deemed irrevocably to
have waived its right or entitlement to the City e Ev t at otherwise could have occurred
during the prior Fiscal Year(s). Live Na . shall have e right to promulgate reasonable rules
from time to time concerning City Us long as thp, TP (,c\nllilltpnt mith thp tPTnN hPTPnf ~nrl
rules imposed upon other Events the cility. For purposes of this Section 3.4, "amateur
talent" shall be given its com and e ay meaning and shall refer to performers of
concerts who do not perform lar basi or commercial gain as their primary occupation.
Use. City shall be entitled on two (2) occasions in each
onate for any partial Fiscal Year) during the Term and any
h nd conditions hereof, to allow the Facility to be used for the
by a duly qualified charitable organization (e.g., a 501(c)(3) entity
f one (1) day or one (1) evening and expressly subject to the
ph (b) (each instance of such use is herein referred to as "Charitable
'ty s all not owe a fee, rent or other payment strictly for the Charitable Use,
m (within ten (10) business days after receipt of invoice therefor) reimburse
II actual expenses and costs incurred by Live Nation to facilitate the Charitable
ithout limitation, a fair allocation toward janitorial, clean up, crowd and traffic
control, s and tear-down costs and fees and charges (including for materials, labor and other
services) lrectly necessitated by the occurrence of any Charitable Use; (ii) Live Nation shall
retain exclusive rights to the operation of all concessions and other operations at the Facility
during any Charitable Use, including, without limitation, food and beverage concessions and
sales, including alcoholic beverages (but City Manager shall have the right to prohibit the sale of
alcoholic beverages during any Charitable Use) and all proceeds of sales and concession
operations shall be Operating Revenues (City shall have no right to retain or reserve any portion
thereof nor to operate in competition therewith); Live Nation will ensure that the pricing for any
concessions shall not exceed the normal pricing therefor charged at standard Events at the
- 10-
live nation management agreement (5-11-07),doc
Facility; and (iii) any Charitable Use Event shall be scheduled in accordance with Live Nation's
scheduling needs so as not to conflict with or impair Live Nation's ability to maintain its
anticipated schedule of Events; but shall otherwise be scheduled at a time convenient for the
City, with Live Nation reasonably cooperating with City in coordinating all scheduling (but in
any case, Live Nation shall not be obligated to permit any Charitable Use unless scheduling
therefor was memorialized in writing signed by the parties in advance of any the Charitable Use
Event); (iv) City shall not be permitted to have a Charitable Use for a concert or that violates the
terms of any sponsorship entered into by Live Nation (for purposes of this sentence a "concert"
that is so prohibited shall not refer to "amateur talent" as defined in Section ; and (v)
City's or the charitable organization's entering into a standard use agreement a rov by Live
Nation and City. So long as Live Nation has complied with this SUbParagr~. City all not
be entitled to "roll over" or "carry forward" any unused Charitable Use 0 a p Fisc Year;
such that, in the event during any Fiscal Year no such Charitable Us tours for any
reason, including reasons which were completely outside the parties' re on ntrol, then,
City shall be deemed irrevocably to have waived its right or e. ement the benefit of the
Charitable Use Event that otherwise could have occurred during th ior cal Year(s). Live
Nation shall have the right to promulgate reasonable rul om tim time concerning the
Charitable Use so long as they are consistent with the t s n f and es imposed upon other
Events at the Facility.
(c) Free Cit Parks and Recr ti u er Showcase Event Use currentl
referred to as the "Playground Review." City shal e en Ie on one (1) occasion in each full or
partial Fiscal Year (and proportionately any partial iscal Year) during the Term and any
Renewal Term (for these purposes, "one (1) 0 asion" shall mean a total of three (3)
consecutive days and nights, inclusi earsal and the Event), to make use of the Facility for
hosting the Parks and Recreatio c se Event (currently referred to as "Playground
Review") subject to the provi . ns this suo agraph (c) (each instance of use by the City is
herein referred to in this subpar c) as the "City Playground Review Use"). Although City
shall not owe a fee, rent or other ment strictly for the right to make such City Playground
Review Use, (i) City sha: tly hin ten (10) business days after receipt ofwritten invoice
therefor) reimburse Live a all actual expenses and costs incurred by Live Nation to
facilitate the Ci aygro a Re Iew Use, including, without limitation, a fair allocation toward
janitorial, cl rowd traffic control, set-up and tear-down costs and fees and charges
(including 0 or and other services) directly necessitated by the occurrence of the
City PI n view se; (ii) Live Nation shall retain exclusive rights to the operation of all
con sions 0 operations at the Facility during any City Playground Review Use,
in g, wit t Imitation, food and beverage concessions and sales (but the sale of alcoholic
bevera sha e prohibited during the Playground Review Use unless specifically authorized
in advan . writing by City Manager) and all proceeds of the sales and concession operations
shall be 0 erating Revenues (City shall have no right to reserve or retain any portion thereof nor
to operate in competition therewith); Live Nation will ensure that the pricing for any concessions
shall not exceed the normal pricing therefor charged at standard events at the Facility; (iii) the
City Playground Review Use Event shall be scheduled in accordance with Live Nation's
scheduling needs so as not to conflict with or impair Live Nation's ability to maintain its
anticipated schedule of Events but shall otherwise be scheduled at a time convenient for City;
provided, that Live Nation shall reasonably cooperate with City in coordinating all scheduling
and Live Nation shall in any case accommodate the City Playground Review Event at some time
- 11 -
live nation management agreement (5-11-07),doc
between June 30 and August 15 in each full or partial Fiscal Year (but in any case, Live Nation
shall not be obligated to permit the City Playground Review Use Event unless scheduling
therefore was memorialized in writing signed by the parties in advance of the City Playground
Review Use Event); (iv) under no circumstances shall City be permitted to have a City
Playground Review Use Event for a concert or that violates the terms of any sponsorship entered
into by Live Nation (but this provision shall not be deemed to prohibit City from including
concerts by "amateur talent" as defined in Section 2.4(a) performing as part of the Event), and
(v) City's entering into a standard use agreement approved by City and Live Natio So long as
Live Nation has complied with this subparagraph (c), City shall not be entitled r lover" or
"carry forward" any unused City Playground Review Use opportunity from a p or FI al Year;
such that, in the event during any Fiscal Year no City Playground Revie occur or any
reason, including reasons that were completely outside the parties' reas a I, th , City
shall be deemed irrevocably to have waived its right or entitlement layground
Review Use Event that otherwise could have occurred during t e prior is ar(s). Live
Nation shall have the right to promulgate reasonable rules from ( to tim concerning the City
Playground Review Use so long as they are consistent with the ter ereo and rules in effect
for other Events at the Facility. Notwithstanding anything he contra: ntained herein, City
shall have the right to sell memorabilia directly relate 0 th yent su as CD/DVD products
and to retain any proceeds thereof
(d) Free Com lement Tick s all be entitled to receive twenty-six
(26) complementary tickets for each Event at the aCI I t t is open to the general public, is
presented or promoted by Live Natio erein, "Co lementary Tickets"), subject to the
provisions of this subparagraph (d). ty may n engage in the sale or re-sale of the
Complementary Tickets nor may . y any Complementary Tickets to the intended user
prior to the date the tickets ha lrst be e generally available to the public. Under no
circumstances shall City be e led "roll 0 ' or "carry forward" any unused or un-retrieved
Complementary Tickets; such n case of any Event for which City neglects or otherwise
fails to secure the Com lementa ickets for any reason other than Live Nation's failure to
comply with its obligati der thl ubparagraph (d), including reasons that were completely
outside the parties' reaso b I, then, City shall be deemed irrevocably to have waived its
right or entitle to tho part'cular Complementary Tickets and City shall not be entitled to
any remuner on r any opportunity. Under no circumstances shall City be entitled to
secure an Tickets within the three (3) days immediately preceding the
applica WhICh point any Complementary Tickets otherwise then available shall be
dee out any remedy or rights therein surviving). Live Nation shall have sole
a ntrol over seating location decisions for Complementary Tickets from time to
time s g a the Complementary Tickets are seats within the top 30% tiered price level (and
thus the on may change from Event to Event). Live Nation shall provide a contact with the
City from hom the City can conveniently secure the Complementary Tickets from time to time;
provided, nothing herein shall obligate Live Nation to remind City of the availability of the
Complementary Tickets nor to physically deliver them to City. City shall arrange for an
employee, messenger, or other authorized representative to physically retrieve any
Complementary Tickets from Live Nation.
( e) Free School Complementary Tickets. City shall be entitled to receive up
to twenty-eight (28) complementary tickets (if and as available and without an obligation to
- 12 -
live nation management agreement (5-11-07).doc
reserve seating to make them available) for each Event which is open to the general public
(herein, "School Complementary Tickets"), subject to the provisions of this subparagraph (e). In
case a particular concert or performer appears on multiple consecutive occasions at the Facility,
each of which qualifies as an Event hereunder, that series of Events shall be treated as a single
event for purposes of Live Nation's obligation to provide School Complementary Tickets [thus,
for example, a ballet presented on four (4) consecutive evenings at the Facility or with multiple
shows on consecutive days such as a matinee and evening show on Saturday and Sunday would
constitute four (4) separate Events, but only a total of twenty-eight (28) School Co lementary
Tickets shall be made available for that ballet, with such tickets of the particula date and
time to be determined by Live Nation in its sole and absolute discretion (any s cess e Events
of a single performer or act is herein referred to as a "Run")]. So Ion 've N 'on has
complied with its obligations under this subparagraph ( e), City shall not e titl 0 "ro over"
or "carry forward" any unused or un-retrieved School Complementary T k 'suc hat, in case
of any Event for which School Complementary Tickets hereunde were ai t in respect
of which City neglects or otherwise fails to secure the School leme ary Tickets for any
reason, including reasons that were completely outside the parties' r nabl control, then, City
shall be deemed irrevocably to have waived its right or . lement t se particular School
Complementary Tickets and City shall not be enti e t ny re neration for any lost
opportunity. City may not engage in the sale or re-sale f Sch omplementary Tickets nor
may City offer any School Complementary Tic to t inten d user prior to the date the
tickets for any particular Run of Events first beco ra available to the public. City shall
not be entitled to secure any School Complement Tic ts xcept within the ten (10) business
days immediately preceding the first pre tion of the plicable Run of Events. Live Nation
shall have sole and exclusive control seating loca on decisions for School Complementary
Tickets, and Live Nation may el to ovide School Complementary Tickets as general
admission or any other type of 1. Liv 'on shall provide a contact with the City from
whom the City can conveni sure Sc 01 Complementary Tickets from time to time;
provided, nothing herein shall 0 te ive Nation to physically deliver them to City. City shall
arrange for an employe messeng r ther authorized representative to physically retrieve any
School Complement ts frq Live Nation. City expressly agrees as a material
inducement to Live Nati g to make the School Complementary Tickets so available
that City shall . 'bute t School Complementary Tickets only to schools that serve Miami
Beach resid s 0 and . out charge or fee therefor, with the stipulation that each school
shall in turn 01 Complementary Tickets available without charge or compensation
only to dents and/or faculty of the schools. Live Nation reserves the right to require
tho using Sc 01 Complementary Tickets to show appropriate school picture ID and to
c ames a inst previously provided lists of recipients of the tickets. Live Nation shall have
the rig pr ulgate reasonable rules from time to time concerning the use of the tickets so
long as sa are consistent with the terms hereofto assure the efficient operation of the Facility.
Live Nati n will use good faith efforts to advise the City of the availability of School
Complementary Tickets for an Event at least two (2) weeks prior to the Event.
(t) Community Needs Auction - Net Proceeds Donation. City shall be
entitled to receive net proceeds resulting from each Community Needs Auction. Live Nation
agrees to request of each act headlining any Event at the Facility that is promoted or presented by
Live Nation that one or more of its stars autograph two (2) pieces of "memorabilia." So long as
Live Nation makes the request in good faith, Live Nation shall be deemed to have discharged its
- 13 -
live nation management agreement (5-11-07),doc
obligations respecting its efforts to secure autographed memorabilia. All memorabilia so
autographed shall be kept and stored by Live Nation pending its auction. Commencing with
calendar year 2008, once during each Fiscal Year or partial Fiscal Year during the Term and
Renewal Term, Live Nation shall host an Event at the Facility that includes an auction in which
the autographed memorabilia accumulated to date shall be auctioned to the highest bidder (a
"Community Needs Auction"). The theme of any Community Needs Auction, which City shall
publicize in any manner the City determines is best, shall be a theme of enhancing and
promoting the City's community social improvement programs or other social ograms for
community benefit and welfare as the City may reasonably determine mmunity
Enhancement"). All net proceeds of the Auction shall be delivered to the Cit pro tly after
conclusion ofthe Community Needs Auction and Live Nation's accountin~f Ci agrees
that it shall apply all net proceeds for Community Enhancement. or ese rpos, "net
proceeds" shall mean all proceeds of bids actually received from the Co . N ds Auction,
reduced by all actual expenses and costs incurred by Live Nation to fa ita Community
Needs Auction, including, without limitation, a fair allocation to janit 'al, clean up, crowd
and traffic control, set-up and tear-down costs and fees and charg (incl ing for materials,
labor and other services) directly necessitated by the 0 rrence 0 Community Needs
Auction. Live Nation shall retain exclusive rights to tope 'on of a concessions and other
operations at the Facility during any Community Needs uctio . luding, without limitation,
food and beverage concessions and sales, includi alcoh ic bev ages; and all proceeds of the
sales and concession operations shall be Operati n s (City shall have no other right of
participation in any portion thereof nor to operat III co pe 'tion therewith). Live Nation will
ensure that the pricing for any concessio all not exc d the normal pricing therefor charged
at standard Events at the Facility. r/"\mmnnit ppn" An{'ti/"\n "hl'lll hp scheduled in
accordance with Live Nation's sc du needs so as not to conflict with or impair Live
Nation's ability to maintain its ipated Ie of Events, and the parties shall reasonably
cooperate with each other in rdi ing all eduling (but in any case, Live Nation shall not
be obligated to permit any munity Needs Auction unless scheduling therefor was
memorialized in writi signed h parties in advance of any such Community Needs
Auction). Under no cir ces s I the City be permitted to require Live Nation to host a
Community Needs Aucti udes a commercial concert (but this provision shall not be
deemed to pro . . City om including concerts solely by "amateur talent" (as defmed in
Section 2.4 e ing a art of the Community Needs Auction) or that violates the terms of
any sponsors . 0 by Live Nation. City shall not be entitled to ''roll over" or "carry
forwar " Community Needs Auction opportunity from a prior Fiscal Year; such that,
in t event rin ny Fiscal Year no Community Needs Auction occurs for any reason,
in . g reas s that were completely outside the parties' reasonable control, then, City shall be
deeme evo bly to have waived its right or entitlement to the Community Needs Auction that
otherwise ld have occurred during such prior Fiscal Year(s). Except as may be delivered to
the winni g bidder at a Community Needs Auction, City shall have no right or entitlement in or
to any such memorabilia. Live Nation reserves the right to promulgate reasonable rules
concerning the auction so long as same are consistent with the terms hereof to assure the efficient
operation of the Auction and otherwise to address issues ofhealth, safety, welfare and decorum.
(g) Community Benefit Fund. Pursuant to Resolutions 83-17447, 84-17882,
12-20545, 93-20871, 97-22543, 2004-25583 (collectively, the "Resolutions"), City imposes a
surcharge on all tickets sold at Events in the Facility and uses the proceeds thereof to fund the
- 14 -
live nation management agreement (5-11-07).doc
Community Benefit Fund. City uses funds in the Community Benefit Fund to subsidize the price
of tickets made available to senior citizens and students and to pay for the rental of the Facility
for twelve (12) Events per calendar year. Live Nation agrees (i) to continue to collect the
surcharge and pay amounts so collected to the City on a monthly basis for deposit into the
Community Benefit Fund; (ii) to continue to make available for sale the maximum number of
tickets set forth in the Resolutions, provided that the tickets will be sold at face value (a portion
of which, however, shall be paid from the Community Benefit Fund and the balance of which
shall be paid by the senior citizen or student) and to continue to allow City to rent t Facility for
twelve (12) Events per calendar year at normal rental rates; and (iii) to cooperat t City as to
the procedures for deposit of funds into the Community Development Fund an sale f tickets
pursuant to the Resolutions. The Community Development Fund is us~o bsidize
ticket prices for Events held at the Facility and for twelve (12) rentals e cale yea. Live
Nation recognizes and agrees that if the Community Development Fun es dequate to
subsidize the maximum number of tickets as specified in the Resolutions n for twelve
(12) rentals per calendar year, the surcharge may be increased the to a level that is
adequate to do so (in which case Live Nation shall collect the surcha ofth 'ncreased rate).
(h) Resident Ticket Program. Live atlon rees to erate a ticket program
available only to City of Miami Beach residents (meanin indivl Is who permanently reside in
the City of Miami Beach), by which a limited n er 0 ickets 0 fewer than 100 tickets for
each Event) shall be made available at full fac v ring and charges, fees and taxes as
applicable, including surcharges and commissio , to uc City of Miami Beach residents
("Resident Tickets") in advance of ticke les to the ge eral public. Live Nation reserves the
right to require proof of City residency;' luding, hut n limited to, government photo ID, utility
bill, school ill or other similarly cre Ie icia of residency. For these purposes, the foregoing
Resident Tickets shall be subj the 0 ing rules: Resident Tickets shall be made
available to City of Miami Be re ents at st two (2) calendar days preceding the date upon
which tickets first go on sale t general public and shall remain available for a period of at
least one (1) week after the first n which such tickets go on sale to the general public. All
tickets shall be sold on come, st served basis and shall be available at the Facility box
office. The type and loc io ting for all tickets shall be determined by Live Nation but
shall include a range all lcket prices, Live Nation shall have the right to promulgate
additional re rules cerning such sales so long as same are consistent with the terms
hereof to ss t operation of the program and compliance with these terms and
conditi
(a) Rights of Entry. Representatives, contractors and employees of the City
shall hav the right to enter all portions of the Facility to inspect same, to observe the
performance of Live Nation of its obligations under this Agreement, to install, remove, adjust,
repair, replace or otherwise handle any equipment, utility lines, or other matters in, on, or about
the Facility, or to do any act or thing which the City may be obligated or have the right to do
under this Agreement. Nothing contained in this subparagraph is intended or shall be construed
to limit any other rights of the City under this Agreement. The City shall not unreasonably
interfere with the activities of Live Nation hereunder, and the City's actions shall be conducted
such that disruption of Live Nation's work shall be kept to a minimum. Nothing in this Section
- 15 -
live nation management agreement (5-11-07).doc
shall be construed to impose upon the City any independent obligation to make repairs,
replacements, alterations, additions or improvements or perform any maintenance or create any
independent liability for any failure to do so.
(b) Valet Parking. City reserves to itself and its contractors and designees (i)
all rights to provide valet parking to the Facility, and (ii) all proceeds from the valet parking
operations. City and its contractors and designees shall have the right to use the driveway
entrance and areas located outside the entrance to the Facility for the valet parki operations
and Live Nation shall not interfere with valet parking operations. With respe any valet
parking agreements executed by City after the Effective Date of this Agree ent, ity will
include in such agreement a provision that obligates the valet parking co . s to i emnify
and hold Live Nation harmless from and against all claims resulting fr he igent cts or
omissions of such companies and further obligates such companies to i lu Live ation as an
additional insured on their general liability insurance policies. Live Natio sn no right to
provide valet parking or to contract with other parties for val arkin with respect to the
Facility. If Live Nation desires to prepurchase parking controlled 0 e Ci or to prepurchase
valet parking, City Manager shall have the authority to ne . ate and e . nto such agreements
with respect thereto as City Manager deems acceptable. ~
(c) Namin Ri hts' Advertisin City serves naming and signage rights
with respect to all interior and exterior portion of e ility (and all revenue that may be
derived therefrom) and shall have full approval r ec to all permanent signage installed
both inside and outside the Facility. Wit t limiting th generality of the foregoing, City may
allow advertising signage on the exteri of, or outside , the Facility and may retain all revenue
derived therefrom. City recognize a 've Nation desires to have the name of the Facility
changed to include the name ''Pi " an co nizes that Live Nation has a termination right
pursuant to Section 3.3 below' that as not urred by the date specified in Section 3.3. Live
Nation recognizes and agree t name change does occur Live Nation will be responsible
for obtaining (and shall maintain) signage and for physically changing the exterior signage
for the name of the Fa the co of which shall be included as Operating Expenses. All
exterior and interior sig ge name of the Facility is subject to City Manager's prior
review and appr I as to . e, terials and aesthetics, City's reservation of rights as provided
herein shall plude L Nation from allowing sponsors of temporary Events from using
temporary a s crary signage with respect to any Event.
3.
erm. The ''Term'' of this Agreement shall commence on , 2007
ent Date") and end at midnight on August 31, 2017 ("Expiration Date"), unless
earlier te nated pursuant to the provisions of this Agreement. City shall instruct the current
manager of the Facility to cooperate and assist Live Nation in effecting a smooth transition of the
management of the Facility (but Live Nation recognizes that the management agreement with
current manager will not expire until sixty (60) days after notice ofterrnination is provided by
City). No costs, fees or expenses of City under the current management agreement shall be
included in Operating Expenses.
- 16 -
live nation management agreement (5-11-07).doc
3.2. Renewal Option. Live Nation shall have the option to extend this Agreement for
a period five (5) years following the Expiration Date ("Renewal Term") provided that all of the
following conditions are met:
(i)
(ii)
(iii)
not less than 270 days nor more than 365 days prior to the
Expiration Date of this Agreement, Live Nation shall provide
written notice to City ("Exercise Notice") stating that Live Nation
desires to exercise the renewal option, Time sha be of the
essence with respect to the Exercise Notice and ifL' ation fails
to provide written notice as and when required, th rene I option
shall expire and shall not thereafter be exerCiS~'
both at the time Live Nation delivers its E r No e and at the
time the Renewal Term would otherwise c e ive Nation
exist which, with the giving of notice e pa age of time, would
constitute a default; and ~
City Commission deter~' es t Live Nation has operated,
managed, maintain pr oted d marketed the Facility
throughout the Ter in a m ner consistent with other first class
managers of similar s cilities.
In the event the conditions of . , (1) and (iii e not met, then and in that event this
Agreement shall expire at the end t 'nitial Term (i.e., on the originally stated Expiration
Date) and the provisions of Sectio .1 s pply.
If, however, all con are met, then and in that event this
Agreement shall be renewed on of the same terms and conditions, except that the Required
City Distribution for th t year 0 enewal Term shall be adjusted as hereinafter provided,
which amount shall th e . creased by two percent (2%) on each January 1 of the
Renewal Term (and the ess 1ty Distributions under Section 4.3(a) and (b) shall remain
applicable).
istribution for the first Fiscal Year of the Renewal Term shall mean
C' y Distribution in effect during the last Fiscal Year (or partial Fiscal Year)
(1 year Term multiplied by a fraction, the numerator of which is the CPI in
17 and the denominator of which is the CPI in effect for June 2007, The parties
a e Required City Distribution for the last year of the Term will already reflect a
m increase in the Required City Distributions in effect at the Commencement Date
and they lly intend that such amount be increased by the cumulative increase in the cost of
living that occurred over the initial ten-year Term.
As used herein "CPI" means the consumer price index for all urban consumers. South
Florida Area Average, all items (1982-1984 = 1 00) issued by the United States Department of
Labor, bureau of Labor Statistics, but if such index is discontinued, a comparable index that
measures increases in the cost of living shall be substituted.
- 17 -
live nation management agreement (5-11-07).doc
3.3. Live Nation's Early Termination. Notwithstanding anything to the contrary
contained in this Agreement, Live Nation shall have the right to terminate this Agreement upon
either of the following occurrences: (a) if by December 31,2007 City has not done one of the
following: (i) caused the existing resort tax bonds to be defeased so that the Facility is no longer
security for such bonds; or (ii) obtained the unqualified opinion (issued to both City and Live
Nation) of the City's bond counsel that this Agreement does not violate the bond obligations and,
therefore, defeasance is not required; or (b) City Commission has not changed the name of the
Facility to include "Filmore" by December 31,2007. If either (a) or (b) occurs bu ive Nation
does not give written notice of termination on or before January 31, 2008, Li tion shall
irrevocably be deemed to have waived its option to terminate and the provision of t Section
3.3 shall be void. If Live Nation timely exercises its right Oftermination,~eem t shall
be terminated as of January 31, 2008 and the provisions of Section 13.1 her app
4. Live Nation's Compensation; City Distributions.
4.1. Management Fee. " '
(a) As consideration to Live Nation r r ing t~ices herein specified
during the Term and any Renewal Term, Live Nation sh from the Net Operating Profit
the amounts described in (i) and (ii) below:
) r The Management Fee shall be payable in equal monthly installments due
last day of each month during each Fiscal Year, and Live Nation shall be
dr such amounts from the account established pursuant to Section 5.3. The Bonus
shall be p to Live Nation from the account established pursuant to Section 5.3 within thirty
(30) days ollowing the annual reconciliation made pursuant to subparagraph (a)(ii).
(i) an annual managem
partial Fiscal Years) in the amount of $4 0,000 the'
Fee shall be adjusted upward on Jan , 2009 a
thereafter by two percent (2%); and
o each Fiscal Year (but prorated for
nagement Fee"), which Management
on the ftrst day of each Fiscal Year
ive Nation to operate and manage the Facility
a . ve th Required City Distributions and maximize the
ions, then after the disbursements of the Required City
'ons and the Management Fee, Live National shall be
et perating Profit for such Fiscal Year (the "Bonus"). By
ye , Live Nation shall provide to City an accounting of the
erating Revenues for the prior Fiscal Year and reconciliation of
Requir City Distribution, Excess City Distributions, and any other
Operating Revenues for such Fiscal Year.
(c) Live Nation's right to receive the Management Fee and Bonus are both
subject and subordinate to City's rights to receive all amounts pursuant to Sections 4.2, 4.3 and
5.1. Live Nation shall not receive any payments for the Management Fee unless City has
received its payments under Sections 4.2 and 4.3.
- 18 -
live nation management agreement (5-11-07).doc
4.2. Required City Distribution. Live Nation shall distribute to City the Required City
Distribution in annual payments in advance, the first of which shall be due and payable on the
Commencement Date and each subsequent installment shall be due on January 1 of each Fiscal
Year. Such amounts shall be distributed from Operating Revenues if and to the extent sufficient
funds are available therefor but shall otherwise be paid to City from Live Nation's own funds
pursuant to Section 5.1. Each installment of Required City Distributions shall be distributed or
paid to City, without setoff, reduction or abatement and net of any taxes or impositions that may
be levied or imposed thereon by any federal, state or local governmental body (all 0 which shall
be paid by Live Nation as and when due).
4.3. Excess City Distribution. In addition to the Required City
shall receive additional disbursements ("Excess City Distributions"), as oIl ws:
(a) Ticket Sales. Within sixty (60) days after the con u 0 ach full or
partial Fiscal Year during the Term and any Renewal Term, L' Natio shall notify City in
writing ofthe total number of "True Tickets" (hereafter defined) or ents i the Facility during
the Fiscal Year or partial Fiscal Year. Ifthe total number True Tic ceeds 240,000 True
Tickets (but the 240,000 threshold shall be prorated fi r Fiscal ears), then, the notice
from Live Nation to City shall be accompanied by a disl:> rseme 0 the City ("Bonus on Excess
Ticket Sales"), in an amount equal to the product On ollar .00) multiplied by the total
number of True Tickets in excess of 240,000 u ample, if there were 250,000 True
Tickets, the amount would be $10,000). For th p s, "True Tickets" (or separately, a
"True Ticket") shall refer to each ticket to a custo r for an Event promoted or presented
by Live Nation (or its affiliate) during e applicable al Year, provided such ticket is not for
"City Use," "Charitable Use," "C ground Review Use," "Complementary Tickets,"
"School Complementary Tickets" , . Needs Auction," or for any Event which occurs
by reason of any third-party r alo arts or of the Facility (for purposes of this Section 4.3,
a "third party rental" shall m a I to any party other than an "affiliate" of Live Nation and
an "affiliate" of Live Nation shal er to any related entity, subsidiary, or parent entity of Live
Nation or Live Nation's t entity
on ents. Within sixty (60) days after the conclusion of each full
e Term and any Renewal Term, Live Nation shall notify City in
be f Events held in the Facility other than those specifically excluded
rue Events"). If the total number of True Events exceeds 173 True
artial Fiscal Years), then the notice from Live Nation to City shall be
anied a sbursement to City ("Bonus on Events") in an amount equal to the product
hous d Dollars ($2,000) multiplied by the total number of True Events in excess of
173 (but ed for partial Fiscal Y ears) (thus for example, ifthere were 188 True Events, the
amount w ld be $30,000) (all True Events in excess of 173 are herein referred to as "Bonus
Events" or separately as a "Bonus Event"). Notwithstanding anything to the contrary contained
in this Section, True Events shall not include "City Use," "Charitable Use," "City Playground
Review Use," or "Community Needs Auction." True Events shall include third party rentals
except for third party rentals in which the Facility is used for purposes substantially different
from the types of Events promoted or produced by Live Nation.
- 19 -
live nation management agreement (5-11-07),doc
(c) Amounts to be paid to City pursuant to (a) and (b) above shall be
distributed from Operating Revenues if and to the extent sufficient funds are available therefor
but shall otherwise be disbursed by Live Nation to City from Live Nation's own funds pursuant
to Section 5.1 hereof. All such amounts shall be distributed or paid to City, without setoff,
reduction, or abatement and net of any taxes or impositions that may be imposed thereon by any
federal, state or local governmental authority (all of which shall be paid by Live Nation as and
when due).
(d)
5.1. Live Nation Funding Guaranty. Live irrevocably and
unconditionally guaranties to City that Operating Revenues e e sufficient to pay
as and when due all Operating Expenses, the Required it ibutions rsuant to Section 4.2,
and the Excess City Distributions pursuant to Section 4. and a ther amounts that Live Nation
is obligated to pay pursuant to this Agreement. L' Nat n here covenants and agrees that if
at any time there are insufficient Operating Reve es to pa all 0 the foregoing amounts as and
when required, Live Nation shall immediately pa er ce from Live Nation's own funds.
The foregoing obligation is absolute and nconditional nd shall apply even if the foregoing
constitutes a guaranty of payment and co lection. rating Revenues are reduced or limited
by facts or circumstances not cont p d by the parties or for reasons beyond the parties'
control. To the extent Live Naf ake such payment, Live Nation shall be entitled to
reimbursement from Net Ope ing Profit a nd when sufficient funds are available. Live
Nation agrees, however, that u xpira Ion or termination of this Agreement, Live Nation
shall pay from its own funds all rating Expenses, Required City Distributions, Excess City
Distributions, and all ot mounts ired to be paid pursuant to this Agreement through the
date of expiration or te rom and after the date of expiration or termination, Live
Nation shall not be entitle an eimbursement for any such payments and Live Nation hereby
irrevocably w y rig t seek any such reimbursement. The provisions of this Section 5.1
shall surviv. tio r termination of this Agreement.
) City shall have no obligation to provide funds for the payment of
nses and shall be entitled to receive the Required City Distributions and the
istributions from Live Nation even when Operating Revenues are insufficient.
(b) City will have no funding or other payment obligations with respect to the
Facility or its Operating Expenses or its operations other than the costs of the City Work and the
other costs which City has specifically agreed to pay under the terms of this Agreement. Live
Nation and City have entered into this Agreement with the expectation and belief that no
governmental body will impose any ad valorem taxes upon the Facility nor any sales, income,
excise or other taxes upon the Required City Distributions or the Excess City Distributions
- 20 -
live nation management agreement (5-11-07).doc
(collectively "Termination Obligations"). In the event any governmental body asserts that any
Termination Obligations are due for a Fiscal Year, or part thereof, then City shall have the right,
at any time thereafter to terminate this Agreement upon not less than thirty (30) days prior
written notice to Live Nation ("Termination Notice"). In the event City does not exercise its
termination right for a Fiscal Year with respect to which Termination Obligations were imposed,
City shall nevertheless retain its right of termination and may elect to terminate in the event that
any Termination Obligations are imposed with respect to any subsequent Fiscal Year (i.e.,
waiver of termination with respect to any particular Fiscal Year shall not constitu waiver for
any subsequent Fiscal Year). If City exercises its termination option, the follow' all occur:
(a) this Agreement shall terminate upon the date specified in the Termination otic (b) Live
Nation shall pay all amounts owed under this Agreement through th of ter ination
including all Operating Expenses and the Required City Distrib ti an xce City
Distributions (including any amounts required to be advanced by L e tion ursuant to
Section 5,1); and (c) City shall pay to Live Nation a "Termination aymen' a er defined.
The Termination Payment shall be an amount equal to the unam ed cos of the Upgrades as
of the Termination Date. The unamortized cost shall be determined mo ing the total costs
(up to but not exceeding $3,500,000) paid by Live Naf to unrel third parties for the
Upgrades on a straight line basis (without interest) ove the p . d from e date when the costs
were incurred over the then-remaining period of the initia: ten (1 Term of this Agreement.
5.3. Receipts and Disbursements. Liv s II establish and maintain in one or
more depositories one or more operating, payrol e bank accounts for the promotion,
operation and management of the Faci . as Live N ion shall determine. All Operating
Revenues collected by Live Nation fr the operation the Facility shall be deposited into the
accounts and all Operating Expense sh e paid by Live Nation as agent for the City from the
accounts. All Operating Reve are th Ie property of City but are to be used by Live
Nation for application as provo ed i his Agr ment. Any amounts remaining in such accounts
upon termination of this Agre r any reason, after payment of all Operating Expenses,
Required City Distributions and a xcess City Distributions and all other amounts that Live
Nation is required to p er this greement through the date of expiration or termination
shall be promptly paid to iv . Live Nation shall be entitled to the Termination Payment
ina ed by City pursuant to this Section 5 .2(b) and not if termination
) Live Nation shall not make any additions, improvements, or alterations
terations") to the Facility without City Manager's prior written approval, except,
ity Manager's consent shall not be required with respect to (i) the Upgrades to be
made by e Nation pursuant to subparagraph 5.4(b)(ii) below; or (ii) Alterations required by
Governmental Requirements; or (iii) nonstructural Alterations that are not visible from the
exterior and do not in the aggregate cost more than $400,000. The costs of all Alterations made
by Live Nation for purposes of complying with Governmental Requirements or that are
necessary for the maintenance of the Facility shall be Operating Expenses. The costs of all other
Alterations made by Live Nation shall be borne solely by Live Nation from its own funds and
shall not constitute Operating Expenses. City Manager shall not unreasonably withhold its
consent to any Alterations except that City Manager may withhold its consent in its sole andt
- 21 -
live nation management agreement (5-11-07).doc
absolute discretion with respect to any Alterations that change the structural elements or systems
or that affect the exterior of the Facility. Notwithstanding anything to the contrary, however,
Live Nation shall not under any circumstances be permitted to make any Alterations that:
(i) adversely affect the structural portions of the Facility, or (ii) fail to comply with any
applicable Governmental Requirements, or (iii) interfere in any material manner with the proper
functioning of any mechanical, electrical, plumbing, HV AC, life safety or other systems,
facilities or equipment located in or serving the Facility, or (iv) diminish the value ofthe Facility.
(b) The parties agree that the followiog work will be done br!espective
parties at their sole cost and expense and not as part of Operating Expenses:
(i) Live Nation covenants and agrees to ge rm rem eling,
work is herein referred to as the "Upgrade" or "Upgrades") pursuant to th 0 '. erms:
Concept plans shall be submitted by Live Nation to City Ma er fo is/her consent (not
to be unreasonably withheld) not later than ninety (90) d s after t a e of this Agreement
(whereupon same shall be deemed a part hereof) (the" on e lans"). e Concept Plans shall
be consistent with Exhibit "C" in all respects and with t purp , rights and obligations under
this Agreement and shall generally reflect, but no eces ily to ale and without the level of
detail and specifics found in final plans and s cificati s, the overall anticipated scope of
Upgrades to be constructed by Live Nation. Pri . ting an application for a building
permit for Upgrades) Live Nation shall de lop or cause be developed construction plans and
specifications, which shall be consist WIth the C ept Plans approved by City Manager
(collectively, the "Plans"). The PI s II include all of the specific capital improvements
described on Exhibit "C," all of h Li ation shall complete on or before December 31,
2009, subject to the terms oft' su aragrap A(b)(i). Live Nation shall expend not less than
$3,500,000, including both c and reasonable soft costs (the "Cap") to complete the
Upgrades; provided, however, r.; Nation agrees to complete the Upgrades in the order of
priority shown on Exhi "." Acc ngly, the Cap shall first be expended towards Priority 1
until completed, then Pri 1 . completed, etc. Upon achieving the Cap, Live Nation will
be deemed to have satis 1 its ligations hereunder with respect to the Upgrades even if all
Upgrades hav en be ompleted. The parties agree that prosecution of the Upgrades may
proceed in lat to minimize interference with portions of the Facility so as to allow
the conf ed 0 Facility for the permitted uses throughout the prosecution of the
Upgr es a ye . n shall determine, in its sole discretion, from time to time. Live Nation
w btain tH ap roval of final Plans by any and all federal, state, municipal and other
gove ntal thorities, offices and departments having jurisdiction in the matter, as required
and nece Live Nation will complete all Upgrades in a good and workmanlike manner and
in accord ce with all applicable Governmental Requirements. Any general contractor
performing any Upgrades shall be subject to approval by City Manager, such consent not to be
unreasonably withheld, conditioned or delayed.
(ii) The following will be considered "City Work": all work as
described in and subject to the terms of Exhibit "B" attached hereto and made a part hereof. The
City Work shall be performed and completed by City pursuant to a schedule as agreed upon by
City Manager and Live Nation and in such a manner as to not cause unreasonable interference or
- 22-
live nation management agreement (5-11-07).doc
delay in Live Nation's performance of the Upgrades, but in any event the City Work shall be
completed by November 1, 2008.
(c) Live Nation shall obtain all required permits for Upgrades and all other
Alterations by, through or under Live Nation and shall perform or cause to be performed such
Alterations in compliance with all Governmental Requirements. Under no circumstances shall
Live Nation make any Alterations which incorporate any Hazardous Substances including,
without limitation, asbestos-containing construction materials, into the Facility. An request for
City Manager's consent to any proposed Alterations by, through or under Live n shall be
made in writing and shall contain plans or other written materials describing tll wo in detail
reasonably satisfactory to City Manager, provided that architectural plans not be quired
unless required for the issuance of a building permit. City Manage ide deny
consent within thirty (30) business days following receipt of Live Nati equest, the
failure to provide or deny consent within such thirty (30) business day pe '0 e deemed a
consent. Should the work proposed by Live Nation and consen to by 'ty Manager modify
the basic floor plan of the Facility and the building permit therefo guire chitectural plans,
then Live Nation shall, at its expense, furnish City with built dra and CAD disks for
such work consistent with City's systems and standar or h work. Unless City Manager
otherwise agrees in writing, all Alterations made or affi d to t cility (excluding moveable
trade fixtures, equipment, personal property an rnit e) (inc (ling without limitation, all
Upgrades constructed pursuant to subparagraph 11 come the property of City and shall
be surrendered with the Facility at the expiration erm tl n of this Agreement. With respect
to Alterations costing in excess of $100, City Mana may require Live Nation to obtain a
payment and performance bond for work and/or ter into a guaranteed maximum price
contract with the general contractor.
II keep full and accurate accounting books and records
enu and Operating Expenses and all True Tickets sold and True
e with generally accepted accounting principles. Live Nation shall
rized presentatives access to such books and records during reasonable
reasonable advance notice. All books and records shall be made
Facility or electronically. Live Nation shall keep and preserve for at least
3) yea 011 wing each Fiscal Year or for as long as such records are required to be
ursu t to Florida Public Records Law, all sales slips, rental agreements, purchase
ks, credit card invoices, bank books or duplicate deposit slips, and other evidence
of Operat' Revenues and Operating Expenses for such period. In addition, on or before
March 31 following each Fiscal Year (commencing March 31, 2008), Live Nation shall furnish
to the City a line item statement of Operating Costs and Operating Revenues (and profit or loss)
for the Facility for the preceding Fiscal Year and including the number of True Tickets sold and
True Events held, prepared in accordance with generally accepted accounting principles certified
as accurate by Live Nation's Chief Accounting Officer or Chief Financial Officer.
6.1.
6.
- 23 -
live nation management agreement (5-11-07).doc
(b) City Manager shall have the right at any time, and from time to time, to
cause independent auditors or City's own accountants or auditors to audit all ofthe books of Live
Nation relating to Operating Revenues, Operating Expenses, True Tickets and True Events
including, without limitation, cash register tapes, credit card invoices, duplicate deposit tapes,
and invoices. No costs incurred by the City in conducting such audit shall be considered an
Operating Expense. The City's right to have an audit made with respect to any Fiscal Year and
Live Nation's obligation to retain the above records shall expire three (3) years after Live
Nation's statement for such Fiscal Year has been delivered to the City.
6.2. Annual Plan. Commencing March 1, 2008, Live Nation shall pr the City
on or before March 1 of each year, an annual management plan, which sh annual
operating budget for the then current Fiscal Year but may not have a c ooki plan.
The annual plan shall include information regarding Live Nation's a 'c rations for
such Fiscal Year, including planned operating and maintenance activit s, . ted capital
improvements and capital equipment purchases and an anticipa budge herefor, anticipated
Events at the Facility (to the extent known at such time), and planne uip nt and furnishings
purchases. Live Nation shall have the right from time to~e to ma y changes it deems
necessary or appropriate to any such annual plan so l~ as annua plan is consistent with
Live Nation's fulfillment of its obligations hereunder.
7. Employees.
7.1. Live Nation Employees.
(a) Live Nation s
employees as is necessary or appr
Live Nation shall recruit emplo es
facilities operated by Live n
authority to hire, terminate
working at the Facility.
ect, train and employ at the Facility such number of
te ive Nation to satisfy its responsibilities hereunder;
onsisten th standards employed at comparable first class
the C mmencement Date, and Live Nation shall have
cipline any and all personnel employed by Live Nation
(b) atio shall assign to the Facility a competent full-time general
manager expe ating and managing similar facilities, who will be located full time
on-site duro om time to time the general manager may provide assistance in
connection wi and/or management services provided by Live Nation or any of its
Affili . 'ties managed, owned or leased by Live Nation or any of its Affiliates so
10 s such ist ce does not affect in any material respect the responsibilities and duties of
the g al ma ger to the Facility. Prior to Live Nation's appointment of the general manager,
Live Na: II consult with the City Manager with respect to the qualifications of the general
manager p posed by Live Nation, The general manager shall be accessible to City Manager or
designee at all reasonable times to discuss the management, operation and maintenance of the
Facility. "Accessible" shall mean available either in person, by telephone and/or e-mail during
business and/or operation hours and within a reasonable time frame during non-business hours in
the event of emergency. Consistent failure by the general manager to be accessible shall be
reported to Bruce Eskowitz and/or James Tucker or their successors and if not rectified shall be
grounds for replacement of the general manager. City Manager may also request that general
manager be replaced for other reasons and Live Nation shall duly consider all such requests.
- 24-
live nation management agreement (5-11-07),doc
(c) The general manager and/or any and all other Live Nation employees at
the Facility shall not for any purpose be considered to be employees of the City, and Live Nation
shall be solely responsible for their supervision and daily direction and control and for setting
and paying as an Operating Expense their compensation (and federal income tax withholding)
and any employee benefits.
7.2. No Solicitation or Employment by City. During the period commencing on the
date hereof and ending one (1) year after the expiration or termination of this Agree ent, except
with Live Nation's prior written consent, the City will not, for any rea , olicit for
employment, or hire, any of the senior management personnel employed by Li Na n at the
Facility, including, without limitation, the general manager, director-~mPlO es and
department heads (including, without limitation, the food and beverage a ger, n ad ion to
any other remedies which Live Nation may have, specific performance t orm f injunctive
relief shall be available for the enforcement of this provision.
8. Indemnification and Insurance.
8.1. Indemnification. "-
(a) Live Nation shall indemnif h~Ol ~h~and defend (with counsel
approved by City Attorney) the City, its offic a ent servants and employees from and
against any and all claims, liabilities, demands, c a ion, costs and expenses (including
reasonable attorneys' fees at trial and I levels of a peal) of whatsoever kind or nature
("Claims") arising out of (i) error, 0 . Slon or neg' nt act or willful misconduct of Live
Nation, its agents, servants, contract employees; (ii) any default by Live Nation under this
Agreement; or (iii) any other 1 ar , directly or indirectly, from the operation or
management of the Facility or vent he erein or rental or use of the Facility; provided
that there is expressly exclu 0 e foregoing obligations any Claims solely resulting from
the acts or negligence of the City, officers, agents (excluding Live Nation), and employees or
the use of the Facility b City, it cers, agents (excluding Live Nation), and employees.
) ive Nation shall secure (and deliver to City Manager certificates thereof)
encement of the Term hereunder and shall keep in force at all times during the
his greement and any Renewal Term a commercial liability insurance policy,
including lic liability and property damage, covering the Facility and the operations
hereunder, in the amount of Ten Million Dollars ($10,000,000.00) for bodily injury and Five
Million Dollars ($5,000,000.00) for property damage, including products and completed
operations and independent contractors. Live Nation shall also maintain Umbrella liability
insurance with a limit of Twenty Million Dollars ($20,000,000).
s of this Section 8.1 shall survive expiration or termination
(b) Live Nation shall also maintain during the Term and any Renewal Term
Comprehensive Automotive Bodily Injury and Property Damage Insurance for business use
- 25 -
live nation management agreement (5-11-07),doc
covering all vehicles operated by Live Nation officers, agents and employees in connection with
the Facility, whether owned by Live Nation, the City, or otherwise, with a combined single limit
of not less than Two Million Dollars ($2,000,000.00) per occurrence (including an extension of
hired and non-owned coverage).
(c) Commencing with the Commencement Date of the Term and continuing
thereafter during the Term hereof and any Renewal Term, Live Nation shall also maintain:
advertising liability insurance
(d) Live Nation shall be the named insured un
shall be an additional insured under the insurance policies desc i
( c), above, as its interests may appear, and all of the .
Section 8,2 shall contain a provision covering the indem if!
8.3. Worker's Compensation Insurance. Li maintain
worker's compensation insurance (including oc ationa iseas hazards) with an authorized
insurance company or through the Florida State s ion Insurance Fund or through an
authorized self-insurance plan approved b the S ate of lorida, insuring its employees at the
Facility in amounts equal to or greater t quired u law. The foregoing is not intended to
require Live Nation to cover occupa . related diseases of any City employees who provide
any services at the Facility as a p loyee of Live Nation except to the extent that such
disease is demonstrated to be di cd eir work at the Facility,
8.4.
(a) P nsur ceo Live Nation shall maintain in full force and effect
during the entire Term d n enewal Term insurance on the Facility (including, without
limitation, all tions) d all fixtures, equipment and personal property at the Facility under
an "All Ris sical L " policy (hereinafter referred to as "All Risks") including, without
limitation, co ss or damage by fire, water, windstorm, flood, subsidence and
sprink a such insurance to be written with full replacement coverage (the
"Re acemen alu , i.e., in an amount equal to the greater of (1) 100% of the full costs of
re ent 0 e Facility and such fixtures, equipment and personal property (less the cost of
excava undations and footings), or (2) an amount sufficient to prevent City from
becoming co-insurer of any loss under the applicable policy. The insurance company's
determina ton of the amount of coverage required in clause (1) above shall be binding and
conclusive on City and Live Nation for purposes of the coverage required by clause (1). If not
otherwise included within the "All Risks" coverage specified above, Live Nation shall carry or
cause to be carried, by endorsement to such "All Risks" policy, coverage against damage due to
water and sprinkler leakage, flood and collapse.
- 26-
live nation management agreement (5-11-07).doc
(b) Builder's Risk. Live Nation shall also carry Builder's Risk Insurance
during any period of construction or improvements or Alterations by, through or under Live
Nation.
8.5. General Requirements. All insurance provided for in this Article 8 shall be in
such form and shall be issued by such responsible insurance companies licensed to do business
in the State of Florida with companies having a rating of A-7 or better in Best's Insurance Guide
as published by A.M. Best and Company. Such insurance may be carried under bla et policies
that include other properties so long as the policies provide separate coverage e Facility.
Upon the execution of this Agreement, and, thereafter, not less than thirty (30) ys 'or to the
expiration dates of the expiring policies required pursuant to this Artic rigina of the
policies or certificates or renewal certificates, as the case may be, bear' n s evi ncing
the payment of premiums or accompanied by other evidence reasonabl s fact to City of
such payment, shall be delivered by Live Nation to City and any fee mo ag policies of
insurance provided for in Section 8.4 shall name City as an in sur arty an loss payee and City
shall be entitled to all proceeds thereof
Each policy of insurance required to be carrie p r t to the rovisions of Article 8
shall contain (i) a provision that no act or omission ofCi ation shall affect or limit the
obligation of the insurance company to pay the aunt 0 any 10 sustained, (ii) an agreement
by the insurer that such policy shall not be cancel d di d or denied renewal without at least
thirty (30) days prior written notice to City, (iii) a IV 0 ubrogation by the insurer, and (iv)
deductibles which do not exceed deduct' s for similar acilities. All insurance procured by
Live Nation in accordance with the re ements ofthi greement including insurance provided
under 8.2, 8.3 and 8.4 shall be pri r any insurance carried by the City and not require
contribution by the City.
8.6. Certain Other a. If any of the City Agreements with third parties consist
of agreements with independent c actors to provide services in respect of the Facility, the City
shall use reasonable e to cau ch contractors to name Live Nation as an additional
insured under any insura ce . ed by such contractors pursuant to the terms of such City
ent 0 deliver to Live Nation promptly after request therefor a
a certificate evidencing the existence thereof In addition, if Live
a ements during the term of this Agreement with any independent
ro on of services hereunder, Live Nation shall require the contractors to
City as additional insureds under any insurance required by Live Nation
der an 0 eliver to Live Nation and City prior to the performance of such services a
evid cing the existence thereof
9.
9.1. Ownership. The ownership of the Facility and all buildings and real estate, all
existing (and replacements thereof) technical and office equipment and facilities, furniture,
displays, fixtures, vehicles and similar tangible property located at the Facility shall remain with
the City. Ownership of and title to all intellectual property rights of whatsoever value held in the
City's name shall remain in the name of the City. The ownership of consumable assets (such as
office supplies and cleaning materials), personal property, equipment and fixtures purchased
- 27 -
live nation management agreement (5-11-07).doc
with Operating Revenues or City funds shall remain with the City, but such assets purchased
with Operating Revenues may be utilized and consumed by Live Nation in the performance of
services under this Agreement. The ownership of data processing programs and software owned
by the City shall remain with the City, and the ownership of data processing programs and
software owned by Live Nation shall remain with Live Nation. Live Nation shall not take or use,
for its own purposes, customer lists or similar materials developed by the City for the use of the
Facility, unless written consent is granted by the City Manager. Ownership of equipment,
furnishings, materials, or fixtures not considered to be real property purchased by ive Nation
with Operating Revenues for use at and for the Facility shall vest in the City a ically and
immediately upon purchase or acquisition, except for those items which by t . te of this
Agreement shall remain the property of Live Nation. The assets of the Ci escrib herein
shall not be pledged, liened, encumbered or otherwise alienated or as'g d. M'iths nding
anything to the contrary contained in this Agreement, any personalty, 1 gs, d movable
equipment that is not a fixture and is not integral to the operatio of the ac rchased by
Live Nation and used at the Facility shall be the sole property of Natio
9.2. City Obligations. Except as otherwise set fl ent, throughout the
Term and any Renewal Term, the City will maintain II b and ownership of the
Facility and will pay, keep, observe and perform all pay ents, s covenants, conditions and
obligations under any bonds, debentures or other urity reeme s or contracts relating to the
Facility to which the City may be bound. In ad If he ity shall provide Live Nation with
necessary office space in the Facility and such equ men s currently available in the Facility.
Furthermore, the City (in its proprietary c city) shall al w Live Nation unrestricted egress and
ingress to the Facility and Live Nati hall have th right to park at no cost in the parking
spaces that are included within th me . g of the "Facility" as defmed herein. Except as
defined as part of the Facility, a ring d garages adjacent to the Facility are excluded
from the scope of this Agree t. twithsta ing anything to the contrary contained herein, in
order to promote the most pro peration of the Facility, City hereby acknowledges and
agrees that Live Nation will have usive control over the use of the Facility during the Term
and any Renewal Term, . t to th onditions and limitations of this Agreement.
ive Nation may not voluntarily or by operation of law, assign, encumber,
transfer all or any part of Live Nation's interest in this Agreement or
anagement duties hereunder without City's prior written consent, which may be
eld in City's sole and absolute discretion, Any attempt by Live Nation to assign,
pledge, ember or otherwise transfer all or any part of its interest and any attempt to
subcontract its management duties hereunder without first having obtained City's prior written
approval shall be void and of no force or effect. In the event City consents to an assignment,
transfer, encumbrance or subcontract, Live Nation shall nevertheless remain liable for all
obligations hereunder. Any transfer of any stock or other interest in Live Nation shall be
considered a transfer of an interest in this Agreement with respect to which City's prior written
approval is required. Live Nation specifically recognizes that City selected Live Nation to be the
10.
- 28 -
live nation management agreement (5-11-07),doc
manager of the Facility as a result of the City's evaluation of Live Nation's specific
qualifications and experience in operating similar first class facilities.
(b) The provisions of subparagraph (a) above shall not prevent Live Nation in
the performance of its management duties hereunder to grant licenses and concessions and rental
agreements for Events.
10.2. Live Nation Affiliates.
(b) Conflicts of Interest: Non-Compete.
Nation manages other public assembly facilities which may
with the Facility. The management of competing fac'li
interest or breach of Live Nation's duties hereunder; pr ided,
neither Live Nation nor any of its Affiliates shal
entertainment with a capacity of 2,000 - 3,000
(a) Transactions with Affiliates. In connection with .
responsibilities hereunder relating to the purchase and/or procurement of e
supplies, inventories, and services for the Facility, Live Nation shall hav he
obligation, to purchase and/or procure from, or otherwise transact busi s ith,
Live Nation.
that City may have for violation of thi
performance, injunctive relief, and 0
11. Laws and Permits.
s and Liens. Live Nation shall procure any and all permits
e of its duties hereunder and for the operation of the
ent n Facility. City in its proprietary capacity shall cooperate
o ch permits and licenses. Live Nation shall deliver copies of
all such permi licen s to the City Manager. Live Nation shall pay promptly, out of the
Operating enu, all sa taxes, excises, license fees and permit fees of whatever nature
arising from 1 , promotion and management of the Facility. Live Nation shall not
permi ch "s or materialman's or any other lien to become attached to the Facility, or
anJ:; art or p el t reof, by reason of any work or labor performed or materials furnished by
any hanic materialman, so long as the work, labor or material was provided by, through,
or unde ve ation, Live Nation shall cause all obligations for payment for work performed
on service rnished to the Facility by, through or under Live Nation to be paid as and when
due.
11.2. Government Compliance. Live Nation, its officers, agents and employees shall
comply with all Governmental Requirements with respect to the operation, management and
maintenance of the Facility. The foregoing includes the obligation to make improvements or
Alterations (structural and non-structural, and capital and non-capital) as required by
governmental authorities, the cost of which shall be included in Operating Expenses. Live
- 29-
live nation management agreement (5-11-07),doc
Nation shall require any licensee, promoter or user of any portion of the Facility to comply, and
to be financially responsible for compliance, with all Governmental Requirements.
Notwithstanding anything to the contrary contained in this Agreement, Live Nation shall not be
obligated or liable for the cost of City Work or any other costs for which City is specifically
obligated pursuant to this Agreement.
11.3. No Discrimination in Employment; AffIrmative Action. In connection with the
performance of work under this Agreement, Live Nation shall not refuse to hir discharge,
refuse to promote or demote, or to discriminate in matters of compensation agai , ny person
otherwise qualified, solely because of race, color, religion, gender, age, nationa rigi military
status, sexual orientation, marital status or physical or mental disability.
12. Events of Default and Remedies.
e following
12.1. Live Nation's Defaults. The occurrence of any
events shall constitute an Event of Default by Live Nation.
(a) The failure by Live Nation to m ke
Live Nation as and when due, which continues for mo than
from City (including without limitation any Re ired
Distributions (whether to be paid pursuant to Se s 4.2
(b) The failure or inabi . ty by ive N ion to observe or perform any of the
covenants or provisions of this Agree 0 be obs 0 or performed by Live Nation, other
than as specified in other subparagr of this Section 12.1, which continues for more than
thirty (30) days after written noti om Manager; provided, however, if the nature of the
failure is such that more than h eriod is onably required for its cure, then Live Nation
shall not be deemed to have an E nt of Default if Live Nation commences the cure
within such period and therea diligently pursues the cure to completion and actually
completes the cure with' n additi ixty (60) day period;
rmitted pursuant to Section 10.1 of this Agreement, the
ledge, or transfer of this Agreement, whether voluntarily or by
ntract of Live Nation's duties hereunder or any attempt to do any
) ive Nation's failure to provide and maintain the letter of credit required
hereof during any period in which Live Nation has not satisfied the Net Worth
forth in Section 14.1 if such failure continues for more than ten (10) days after
from City Manager;
(e) (i) The making by Live Nation of any general assignment for the benefit
of creditors; (ii) the filing by or against Live Nation of a petition to have Live Nation adjudged a
Chapter 7 debtor under the Bankruptcy Code' or to have debts discharged or a petition for
reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against Live Nation, the same is dismissed within sixty (60) days); (iii) the
appointment of a trustee or receiver to take possession of substantially all of Live Nation's assets
- 30-
live nation management agreement (5-11-07).doc
located at the Facility or of Live Nation's interest in this Agreement, if possession is not restored
to Live Nation within sixty (60) days; (iv) the attachment, execution or other judicial seizure of
substantially all of Live Nation's assets located at the Facility or of Live Nation's interest in this
Agreement, where the seizure is not discharged within sixty (60) days; or (v) failure of Live
Nation to pay its material obligations or material creditors when due other than as a result of a
good faith dispute.
12.2. City's Remedies.
(a) If an Event of Default by Live Nation occurs, then in addiAany other
remedies available to City, City may exercise the following remedies: ~ \
(i) City may terminate this Agreement by en n 'ce to Live
Nation, in which case this Agreement shall terminate and Live Na n 11 mediately
surrender possession of the Facility to City, Upon termination, shall e en 1 ed to recover
from Live Nation: (1) Operating Expenses that remain unpaid throu he da of termination (2)
all Required City Distributions and Excess City Distribuf ns that r i unpaid through the
date of termination (3) all other amounts that Liv N is requ d to pay under this
Agreement through the date of termination plus (4 as eed and liquidated damages
("Liquidated Damages"), a sum equal to all Req . ed C Distn tions that would have been
received by City for the period from the date of minatio through the end of the Term ( or, if
the renewal option has been exercised, through t11 t Renewal Term) if the termination
had not occurred, reduced, however, to esent value applying a 4% discount rate. Live
Nation and City recognize that the C' 's damages' case of any such termination will be
substantial but are incapable of exa a ainment and they have agreed that such Liquidated
Damages are fair and reasonable ot a lty.
11 fCit to Perform. If Live Nation fails to perform any act on its part to be
this Agreement, and the failure continues beyond any applicable grace period
tion 12.2, then in addition to any other available remedies, City may, at its
election p rm the act on Live Nation's part, and City shall have the right to enter the Facility
at any time in order to carry out such performance. City's election to perform the act on Live
Nation's part shall not give rise to any responsibility of City to continue performing the same or
similar acts nor shall City be responsible to Live Nation for any damage caused to Live Nation as
the result of such performance by City. Live Nation shall, promptly upon demand by City,
reimburse City for all sums paid by City in connection therewith, together with interest at the
Default Rate from the date of the payment by City.
performance of any of Live Nation's
exercise any other remedies available at law or in equity.
rious rights and remedies reserved to City in this Agreement or
mulati and, except as otherwise provided by Florida law, City may pursue
emedies at the same time,
- 31 -
live nation management agreement (5-11-07),doc
12.4. City's Defaults. The occurrence of anyone or more of the following events shall
constitute an Event of Default by Live Nation.
(a) The failure by City to make any payment required to be made by City as
and when due, which continues for more than thirty (30) days after written notice of default from
Live Nation;
(b) The failure or inability by City to observe or perform any of t e covenants
or provisions of this Agreement to be observed or performed by City, other than ecified in
subparagraph (a) of this Section 12.4, which continues for more than thirty 0) ys after
written notice from Live Nation; provided, however, if the nature of the fai . such t more
than such period is reasonably required for its cure, then City shall n be ed have
committed an Event of Default if City commences the cure within su iod thereafter
diligently pursues the cure to completion.
may exercise either ofthe following remedies:
(a) Live Nation may give written no 'ce to . that Live Nation intends to
terminate this Agreement and if the Event of De fa is n cured . in ten (10) days thereafter,
Live Nation may terminate this Agreement b written otice to City, in which case this
Agreement shall terminate and Live Nation s e tely surrender possession of the
Facility to City, Upon termination, Liv Nation shall be entitled to recover from City all
amounts owed by City to Live Naf as of the ination date and the provisions of
Section 13.1 shall apply; or
(b) Live Naf
hereunder or seek injunctive
cific performance of any of City's obligations
ent owed to City or Live Nation under this Agreement
Re ired City Distribution (whether pursuant to Section 4.2 or
n ether pursuant to Section 4.3 or 5.1) or Liquidated Damages
or any other payment owed to City or Live Nation under this
a by City or Live Nation within ten (10) days following notice of
bear interest at the rate of 15% per annum ("Default Rate") from the
I, Effect of Termination. In the event this Agreement expires or is terminated for
any rea so , (a) all Operating Expenses, Required City Distributions, Express City Distributions,
and all other obligations for the period up to the date of expiration or termination shall be paid
using funds on deposit in the account(s) described in Section 5.6 and to the extent such funds are
not sufficient, Live Nation shall pay all such amounts pursuant to Section 5.1, and (b) after all
amounts referenced in subparagraph (a) have been paid, Live Nation may retain all remaining
Operating Revenues. Upon the expiration of this Agreement or a termination for any reason, all
further obligations of the parties hereunder shall terminate except for the obligations which for
- 32-
live nation management agreement (5-11-07),doc
all periods up to the date of expiration or termination and such other obligations as are stated to
survive or be performed after such expiration or termination.
13.2. Surrender of Facility. Upon termination of this Agreement (termination shall, for
all purposes in this Agreement, include termination pursuant to the terms of this Section 12 or
pursuant to any other provision of this Agreement and any expiration of the Term and the
Renewal Term, if any), Live Nation shall surrender and vacate the Facility upon the effective
date of such termination. The Facility and (as required under this Agreement) all e ipment and
furnishings shall be returned to the City in good, safe, clean condition and re , easonable
wear and tear, casualty and condemnation excepted.
14. Net Worth Requirement; Security ~
14.1. Net Worth Requirement. Live Nation covenants and ~ during the
entire Term and, if applicable, the Renewal Term, Live Natio hall at 11 tlmes maintain a
Tangible Net Worth of not less than Fifty Million Dollars. s ed he in, "Tangible Net
Worth" shall mean the total assets of Live Nation min all of it . b'lt ies and minus its
intangible assets (such as, but without limitation, good '1, ents, cop' 19hts and trademarks,
licenses, leasehold improvements, unamortized debt di ount expense and the par value of
preferred stock). On or before January 31 of each . scal ear, Li ation shall cause its Chief
Financial Officer to deliver to City a certificat n a for acceptable to City Manager ("Net
Worth Certificate") addressed to City stating whet tion's Tangible Net Worth exceeds
Fifty Million Dollars and showing the c culation of T gible Net Worth and a copy of the
financial statements upon which the ca latlOn was b . City shall have the right at any time
within ninety (90) days after recei e Net Worth Certificate to have its accountant or
designees review the financial ent d other records of Live Nation to confirm the
accuracy of the Net Worth Ce lcat (and Li ation shall cooperate with any such review and
provide any information reas ested y such accountants or designees).
ertificate reflects that Live Nation's Tangible Net Worth
in the event City Manager sends written notice to Live
ts designees have been unable to confirm that Live Nation's
s Fifty Million Dollars, then, in either such case, a "Net Worth
thin fifteen (15) days following the occurrence of a Net Worth
a shall obtain and deliver to City Manager a letter of credit in full
. n 14.2 below, failing which an Event of Default by Live Nation shall
this Agreement and City may exercise all remedies available to City under
14" Security. Upon the occurrence of a Net Worth Deficiency, Live Nation shall,
within ten (10) days after demand by City Manager, deliver to City a clean, irrevocable letter of
credit (the "Letter of Credit") established in City's favor an amount equal to all Required City
Distributions that Live Nation is obligated to pay to City for the entire remaining portion of the
Term (and for the Renewal Term if the renewal option has been exercised) (the "Letter of Credit
Amount"), issued by a federally insured banking or lending institution reasonably acceptable to
City Manager and in form and substance acceptable to City Manager. The Letter of Credit shall
specifically provide for partial draws and shall by its terms be transferable by the beneficiary
- 33 -
live nation management agreement (5-11-07).doc
thereunder. If Live Nation fails to make any payment or other charges due to City under the
terms of this Agreement or otherwise defaults hereunder beyond any applicable notice and cure
period, City Manager, at his or her option, may make a demand for payment under the Letter of
Credit in an amount equal to the amounts then due and owing to City under this Agreement. In
the event that City draws upon the Letter of Credit, Live Nation shall present to City a
replacement Letter of Credit in the full Letter of Credit Amount satisfying all of the terms and
conditions of this paragraph within ten (10) days after receipt of notice from City of such draw.
Live Nation's failure to do so within such 10-day period will constitute a default her nder (Live
Nation hereby waiving any additional notice and grace or cure period), and u ch default
City shall be entitled to immediately exercise all rights and remedies available t it he nder, at
law or in equity, In the event that the Letter of Credit has an expiratio arlier an the
expiration date of this Agreement and Live Nation has not presented to it rep emen Letter
of Credit which complies with the terms and conditions of the Manag Agr ment on or
before thirty (30) days prior to the expiration date of any such Let er of C dit eld by City,
then Live Nation shall be deemed in default hereunder and Cit, additi to all other rights
and remedies provided for hereunder, shall have the right (exercisab Cit Manager) to draw
upon the Letter of Credit then held by City and any such a nt paid t . by the issuer of the
Letter of Credit shall be held by City as security for the erfo ce ofu ve Nation's obligations
hereunder. Any interest earned on such amounts shall b he pro of City. City's election to
draw under the Letter of Credit and to hold th ocee of th Qrawing under the Letter of
Credit shall not be deemed a cure of any default ion hereunder and shall not relieve
Live Nation from its obligation to present to City m nt Letter of Credit which complies
with the terms and conditions of this A ent. Live ation acknowledges that any proceeds
of a draw made under the Letter of 't and therea r held by City may be used by City to
cure or satisfy any obligation of L' e . n under this Agreement as if such proceeds were
instead proceeds of a draw mad er a L f Credit that remained outstanding and in full
force and effect at the time ch ounts e applied by City to cure or satisfy any such
obligation of Live Nation. ut limiting the generality of the foregoing, Live Nation
expressly acknowledge and agre a at the end of the term of this Agreement (whether by
expiration or earlier te . n her f), and if Live Nation is not then in default under this
Agreement beyond any R otice and cure periods and has paid all amounts required
hereby, City sturn t the issuer of the Letter of Credit or its successor (or as such issuer
may direct i ) any raining and unapplied proceeds of any prior draws made under the
Letter of re Nation shall have no rights, residual or otherwise, in or to such
procee
V enueIW aiver of Jury Trial. This Agreement shall be governed by, and construed
in accord ce with, the laws of the State of Florida, both substantive and remedial, without
regard to principals of conflict oflaws. The exclusive venue for any litigation arising out of this
Agreement shall be Miami-Dade County, Florida, if in state court, and the U.S. District Court,
Southern District of Florida, if in federal court. BY ENTERING INTO THIS AGREEMENT,
CITY AND LIVE NATION EXPRESSLY WAIVE ANY RIGHTS EITHER PARTY MAY
HAVE TO A TRIAL BY JURY OF ANY CIVIL LITIGATION RELATED TO, OR ARISING
OUT OF, THIS AGREEMENT.
- 34-
live nation management agreement (5-11-07).doc
15.2. No Partnership or Joint Venture. Nothing herein contained is intended or shall be
construed in any way to create or establish the relationship of partners or a joint venture between
the City and Live Nation. None of the officers, agents or employees of Live Nation shall be or
be deemed to be employees ofthe City for any purpose whatsoever.
15.3. Entire Agreement. This Agreement and all Exhibits attached hereto contain the
entire agreement between the parties with respect to the subject matter hereof and supersedes all
prior agreements and understandings with respect thereto, The Exhibits attache hereto are
incorporated in to and made a part of this Agreement. No other agreements, entations,
warranties or other matters, whether oral or written, will be deemed to bind t p s hereto
with respect to the subject matter hereof.
in whole or in part, except in a writing executed by each of the parties her 0,
15.5. Force Majeure.
(a) No party will be liable or respo si 0 the otH party for any delay,
damage, loss, failure, or inability to perform caused by orce . eure" if notice is provided to
the other party within ten (10) days of date on w . h su party ns actual knowledge of the
event of "Force Majeure" that such party is un e to pe rm. he term "Force Majeure" as
used in this Agreement means the following: an a: d, trike, war, public rioting, lightning,
fire, storm, flood, explosions, epidemics landshdes, Ii htening storms, earthquakes, floods,
storms, washouts, civil disturbances, plosions, an yother cause whether of the kinds
specifically enumerated above or 0 . e which is not reasonably within the control of the
party whose performance is to be se which by the exercise of due diligence could not
be reasonably prevented or ove om (it bein nowledged that under no circumstances shall a
failure to pay amounts due a hereu aer be excusable due to a Force Majeure).
(b)
services if and to the e
services or the provision
any Law.
o shall be under any obligation to supply any service or
d ng any period that the supplying of any such service or
ponent necessary therefore shall be prohibited or rationed by
e event of damage to or destruction of the Facility by reason of fire,
t or occurrence of any nature or any regulatory action or requirements that,
m er case, ex cted to render a part of the Facility inoperable or in Live Nation's opinion
the . ity ca ot be operated in a reasonably profitable manner as a result ofthe damages, for a
period t st one year from the happening of the fire, other casualty or any other such
casualty e t, either party may terminate this Agreement upon written notice to the other.
(d) Live Nation may suspend performance required under this Agreement,
without any further liability, in the event of any act of God or other occurrence, which act or
occurrence is of such effect and duration as to effectively curtail the use of the Facility so as to
effect a substantial reduction in the need for the services provided by Live Nation for a period in
excess of 180 days; provided, however, that for the purposes of this subsection, Live Nation shall
have the right to suspend performance retroactively effective as of the date of the use of the
- 35 -
live nation management agreement (5-11-07).doc
Facility was effectively curtailed. "Substantial reduction in the need for these services provided
by Live Nation" shall mean such a reduction as shall make the provision of any services by Live
Nation economically impractical.
15.6. Binding Upon Successors and Assigns: No Third-Party Beneficiaries.
(a) This Agreement and the rights and obligations set forth herein shall inure
to the benefit of, and be binding upon, the parties hereto and each of their respecti e permitted
successors and permitted assigns.
(b) This Agreement shall not be construed as giving any , othe han the
parties hereto and their successors and permitted assigns, any legal or equ' ble t, re edyor
claim under or in respect of this Agreement or any of the ProViSiO~ in c tained, this
Agreement and all provisions and conditions hereof being intended to be, n . n for the sole
and exclusive benefit of such parties and their successors and rmitte assigns and for the
benefit of no other person or entity.
15.7. Notices. Any notice, consent or other c
Agreement will be in writing and will be effective eit r (a) en delivered personally to the
party for whom intended, (b) on the second busi ess folIo g mailing by an overnight
courier service that is generally recognized as re Ie, or ) on t e fifth day following mailing
by certified or registered mail, return receipt requ , st e prepaid, in any case addressed to
such party as set forth below or as a pa may esigna by written notice given to the other
party in accordance herewith.
City of Miami Beach
City Attorney
1700 Convention Center Drive
Miami Beach, Florida 33139
To Live Nation:
Live Nation Worldwide, Inc.
9348 Civic Center Drive
Beverly Hills, California 90210
Attn: Bruce Eskowitz
- 36-
live nation management agreement (5-11-07),doc
With copy to:
Live N ation Worldwide, Inc.
2000 West Loop South, 13th Floor
Houston, Texas 77027
Attn: James Tucker
15.8. Section Headings and Defined Terms. The headings contained h ein are for
reference purposes only and shall not in any way affect the meaning and inte . on of this
Agreement. The terms defined herein and in any agreement executed in con ctio herewith
include the plural as well as the singular and the singular as well as the and t use of
masculine pronouns shall include the feminine and neuter. Except as 0 rwl 'ndic d, all
the terms thereof waived or modified in accordance herewith and therewit
This Agreement may be executed in two or more counterp , eac of which shall be
deemed an original copy of this Agreement, and all of . ch, whe n together, shall be
deemed to constitute but one and the same agreement.
part of any provision, of this Agreement shall no
this Agreement shall be construed in all respects a
parts were omitted.
15.10. Non-Waiver. either party to take any action with respect to any
default or violation by the other 0 ~ 0 terms, covenants, or conditions of this Agreement
shall not in any respect limit, eju ice, dim . , or constitute a waiver of any rights of such
party to act with respect to r', conte poraneous, or subsequent violation or default or
with respect to any continuation 0 etition ofthe original violation or default.
ity represents, warrants, and covenants to Live Nation the following:
al rig , power and authority to enter into and perform its obligations
greement has been duly executed and delivered by the City and
d binding obligation of the City, enforceable in accordance with its terms,
en ceability may be limited by bankruptcy, insolvency, reorganization or
cting creditors' rights generally or by general equitable principles. City further
n arrants to Live Nation that for so long as Live Nation is not in default under this,
Agreemen eyond any applicable notice and cure period, Live Nation's operation and
management of the Facility shall not be disturbed or hindered by City in its proprietary capacity
or anyone claiming by, through or under City in its proprietary capacity, subject, however, to the
terms, provisions and obligations of this Agreement. The foregoing shall not apply, however,
with respect to the City acting in its governmental capacity or exercising its police powers.
(b) Live Nation represents and warrants to the City the following: (i) Live
Nation has full legal right, power and authority to enter into and perform its obligations
- 37 -
live nation management agreement (5-11-07),doc
hereunder, and (ii) this Agreement has been duly executed and delivered by Live Nation and
constitutes a valid and binding obligation of Live Nation, enforceable in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally or by general equitable principles.
ATTEST:
ORIDA
- 38 -
live nation management agreement (5-11-07).doc
LIVE NATION WORLDWIDE, INC.
By:
Name:
Title:
~
- 39-
live nation management agreement (5-11-07),doc
EXHIBIT "A"
LEGAL DESCRIPTION AND DEPICTION OF THE FACILITY
[NOTE: Be careful when attaching this Exhibit. It should only show the
building footprint of Jackie Gleason Theater and the small parking rea
adjacent to building.]
~
live nation management agreement (5-11-07),doc
..,--/ -
CovaIIi .'" T
on Cea1er DrM: =------ ! J .Ll. I I
.--+-
I ..:
~
^
iii
i!l",
mr-
)>c
(flm
or-
zz
;I!m
m
~
m
III
II
...
~
i ,.. I t I I
y I
i I
:]
I
i -
--.-l - I
'=-
"-
~~
,
~~J
-
r ,..:..::.~ ...1 .....!.
.....l!.
wubiDataa A_
EXHIBIT "B"
CITY WORK
I. ADA RENOVATION SCOPE OF WORK
All necessary work, labor, equipment and materials to complete the ADA modific lions to the
Facility, including, without limitation, all matters reflected and indicated in the ing plans
and specifications:
II.
All necessary w
Bar modific on
indicated i 0
AI.O
ALl
AI.2
AI.3
A3.0
A3.I
A3.2
A3.3
A4.0
A4.I
A4.2
A4.3
A5.0
A5.I
A5.2
A5.3
A13.0
1.
1. .1
1.2.2
AI.2.3A
AI.2.3B
AI.2.4
AI.2.5A
AI.2.5B
A2.I.IB
A2.I.6A
A2.I.6B
Founder's Room Toilet Plan
Founder's Room Finish Plan
Founder's Room RCP
Founder's Room Elevations
Entry Level NW & SW Toilet Plan
Entry Level NW & SW Finish PI~
Entry Level NW & SW RCP
Entry Level NW & SW Eleva~tns .
Mezz. Lobby NE & SE 'let P
Mezz. Lobby NE & SE .. la
Mezz. Lobby NE & SE
Mezz. Lobby SE Elevati s
Mezz. Level & SW Toil Ian
Mezz. Le SW Finish Plan
Mezz. Rep
Me Lev NW & Elevations
Exten mp and Platform Lift Plan
NE BAR RENOVATION SCOPE OF WORK
uip ent and materials to complete the Founder's Room! Mezzanine
cility, including, without limitation, all matters reflected and
ns and specifications:
Founder's Room Demo Plan
Founder's Room Floor Plan
Founder's Room Demo RCP
Founder's Room RCP and Roof Plan
Founder's Room RCP and Lighting
Founder's Room Elevations
Founder's Room Bar "F"
Founder's Room Bar "F"
2nd Floor Lobby Bar
2nd Floor Lobby Bar
2nd Floor Lobby Bar
Exhibit B
Page 1
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
2/03/03
live nation management agreement (5-11-07).doc
eity shall cause all work indicated above shall be substantially complete and able to be used no
later than 11/1/2008. City shall cause all construction trailers, equipment and debris to be
removed from the Facility prior to 11/112008. Live Nation shall meet with the Architect of
Record to review the proposed finishes for this project prior to the start of construction. Live
Nation may request minor changes to the color palette to better coordinate with Live Nation
proposed changes and City shall accommodate such requested changes so long as no additional
costs are incurred.
Live Nation shall meet with the Architect of Record to review the proposed b
project prior to the start of construction. Live Nation may request chang to bars better
coordinate with Live Nation's proposed use and eity shall accommOdat~. s req ted c anges
(but Live Nation shall bear any additional costs). The changes will in loc le 2nd floor
bars 1 '0" further from the wall and redesign for different equipme rewo 2n r lobby back
bar to allow for different equipment, redesign Founder's Roo to si lify design, revise
equipment and create a uniform counter depth.
Live Nation representative to
e construction activities.
Exhibit B
Page 2
live nation management agreement (5-11-07).doc
EXHIBIT "C"
UPGRADES
All necessary work, labor, equipment and materials to complete a $3,500,000 renovation to the
Jackie Gleason Theater. Projects will be completed in the order of priority shown below until
achieving the $3,500,000 spending cap ("eap"), after achieving the eap there hall be no
obligation to perform any remaining work or items. All costs shown include struction
costs, reasonable soft costs, and furniture, fixtures and equipment.
Priority 1-- Modifications to the auditorium to convert to a live mu 'c .~. $1,4 ,000
· Remove all fixed seating between the cross aisle and the stage.
· Install three level platforms between the stage and center cros aisle. clu ps, ramps,
and a low wall drink rail at each level change. Floor surface oak rdwood flooring.
Floor structure to be metal studs and metal deck with a concrete ing ith a portable pit
filler platform over the existing orchestra pit. ~
· Existing interior green drapery will be dyed red, in~in in trav ler and auditorium side
wall curtains.
· Green balcony seat fabric will be replaced w' ed.
· Install (4) new glass and crystal chandeliers p spots.
Priority 2 -- Modifications to existing uction au . and lighting systems.
· Replace existing speakers with a . ay system.
· Augment the existing dimmer tern . h a new 24 channel board.
$400,000
Priority 3 -- Modifications concessions $500,000
. New main lobby flooring.
· Paint main lobby Is.
· Relocate Gleason d a new live music posters and photos.
. Install new red drape lobby.
· Install ne and stal chandelier with blue pin spots in main lobby.
· Add ne n coole djacent to the main lobby for beer storage.
· Add new ith three flavors of beer at each point of sale.
· ack bars and install new display coolers and beer taps.
· are, to accept new equipment as required (i~e binsl speed rails, reach-in
a guns).
· ystem as required.
Priority -- New exterior sign age $200,000
· Modify front marquee signage to have "THE FILMORE" standup letters above the existing
marquee.
· Replace the existing rear building sign with "The Filmore at the Jackie Gleason Theater.
Exhibit C
Page 1
live nation management agreement (5-11-07).doc
Priority 5 -- Balcony VIP box seating and VIP lounge $400,000
· Replace existing seats in front of the balcony cross aisle with new larger high back seats
with cup holders.
· Create VIP lounge in balcony level lobby with new fixed bars and lounge seating and tables.
Priority 6 -- Modify backstage dressing rooms, green room and catering kitchen. 250,000
· Create new catering kitchen adjacent to the existing loading dock behind the practice room.
· Modify existing practice room decor to create a green room. ~
· Upgrade and combine 4 dressing rooms to create two larger dressing rooms . to 'ng acts.
Contingency ~ $ 0,000
,
Exhibit C
Page 2
live nation management agreement (5-11-07).doc
EXHIBIT "D"
MINIMUM MAINTENANCE STANDARDS
live nation management agreement (5-11-07).doc
EXHIBIT "E"
CITY AGREEMENTS
live nation management agreement (5-11-07).doc
EXHIBIT "F"
PENDING BOOKINGS
live nation management agreement (5-11-07).doc