HomeMy WebLinkAbout12412RESOLUTION NO. 12412
A RESOLUTION APPROVING A MANAGEMENT
AGREEMENT BETWEEN THE CITY OF PUEBLO, A
MUNICIPAL CORPORATION, AND GLOBAL SPECTRUM,
L.P., A DELAWARE LIMITED PARTNERSHIP, AND
AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO
EXECUTE SAME
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The Management Agreement, by and between the City of Pueblo, a Municipal
Corporation, and Global Spectrum, L.P., a Delaware limited partnership relating to the
comprehensive management of Memorial Hall, a copy of which is attached hereto (the
“Management Agreement”), having been approved as to form by the City Attorney, is
hereby approved, subject to appropriations therefor for all fiscal years of City after 2012
and other conditions set forth in the Management Agreement.
SECTION 2.
The President of City Council is hereby authorized to execute the Management
Agreement on behalf of Pueblo, a Municipal Corporation, and the City Clerk shall affix
the Seal of the City thereto and attest the same.
INTRODUCED: May 14, 2012
BY: Steve Nawrocki
COUNCIL PERSON
Background Paper for Proposed
RESOLUTION
DATE: May 14, 2012 AGENDA ITEM # Q-1
DEPARTMENT:
FINANCE DEPARTMENT
SAM AZAD, DIRECTOR
TITLE
A RESOLUTION APPROVING A MANAGEMENT AGREEMENT BETWEEN THE CITY
OF PUEBLO, A MUNICIPAL CORPORATION, AND GLOBAL SPECTRUM, L.P., A
DELAWARE LIMITED PARTNERSHIP, AND AUTHORIZING THE PRESIDENT OF
CITY COUNCIL TO EXECUTE SAME
ISSUE
Should City Council approve a management agreement for Memorial Hall?
RECOMMENDATION
Approval of this Resolution.
BACKGROUND
Memorial Hall is currently undergoing renovations that are scheduled to be completed in
May 2013. Memorial Hall is an unique and interesting venue for community events. In
the past, Memorial Hall has been under utilized. The proposed management
agreement with Global Spectrum, L.P. (“Global”) provides for comprehensive and
professional management of Memorial Hall.
Global will serve as the City’s management agent to operate, lease and manage
Memorial Hall, subject to a specific budget to be approved annually. Global will be
responsible for booking events and generating revenue. Global intends to leverage its
other 14 similar theatrical venues to increase bookings, as well as use its marketing
expertise to make programming more successful for local organizations, including the
Pueblo Symphony, Broadway Theater League, and other local arts organizations.
Global will develop a Memorial Hall-owned ticketing system that will generate more
revenue to Memorial Hall, increase the overall sales market area, and offer greater
efficiencies in selling tickets through database marketing.
A management agreement with Global will increase event activity, which will have the
added advantage of increasing advertising signage/sponsorship revenue as well as
food and beverage, ticketing, and merchandise income.
Revenues from the operations will be used to pay for the operating expenses of
Memorial Hall and Global’s fee; however, revenues will likely be insufficient to cover all
anticipated costs. The Finance Department and Global will continuously monitor the
budget for Memorial Hall and undertake efforts to reduce expenses if revenue is not
tracking up to forecast.
FINANCIAL IMPACT
The 2012 pre-opening budget is set at $25,000. This funding will be provided by the
City of Pueblo through the 2012 City Hall Upkeep budget. Global Spectrum will submit
the 2013 operating budget for the Memorial Hall during the City’s 2013 Budget Process.
PRE - OPENING SERVICES AND MANAGEMENT AGREEMENT
between
CITY OF PUEBLO, a Municipal corporation
and
GLOBAL SPECTRUM, L.P.
Effective Date: 4, 2012
NH/
TABLE OF CONTENTS
Page
PRE - OPENING SERVICES AND MANAGEMENT AGREEMENT 1
RECITALS 1
ARTICLE 1 1
DEFINITIONS 1
Section 1.1. Definitions 1
ARTICLE 2 6
SCOPE OF SERVICES 6
Section 2.1 Engagement 6
Section 2.2 Limitations on Manager's Duties 6
ARTICLE 3 6
COMPENSATION 6
Section 3.1 Fixed Management Fee 6
Section 3.2 Incentive Fee 6
ARTICLE 4 7
TERM; TERMINATION 7
Section 4.1 Term. 7
Section 4.2 Termination. 7
Section 4.3 Effect of Termination 8
ARTICLE 5 8
OWNERSHIP; USE OF THE FACILITY 8
Section 5.1 Ownership of Facility, Data, Equipment and Materials. 9
Section 5.2 Right of Use by Manager. 9
Section 5.3 Observance of Agreements. 9
Section 5.4 Use by the Owner 9
ARTICLE 6 10
PERSONNEL 10
Section 6.1 Generally. 10
Section 6.2 General Manager 10
Section 6.3 Non - Solicitation/Non - Hiring. 11
ARTICLE 7 11
PRE - OPENING EXPENSES AND EXPENSE BUDGET 11
Section 7.1 Establishment of Pre - Opening Expense Budget. 11
Section 7.2 Funding of Expenses During Pre - Opening Period 11
ARTICLE 8 12
OPERATING BUDGET 12
Section 8.1 Establishment of Operating Budget. 12
Section 8.2 Approval of Operating Budget 12
Section 8.3 Adherence to Operating Budget 12
ARTICLE 9 13
PROCEDURE FOR HANDLING INCOME 13
Section 9.1 Event Account 13
Section 9.2 Operating Account. 14
ARTICLE 10 14
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FUNDING 14
Section 10.1 Source of Funding 14
Section 10.2 Advancement of Funds. 14
ARTICLE 11 14
FISCAL RESPONSIBILITY; REPORTING 14
Section 11.1 Records. 14
Section 11.2 Monthly Financial Reports. 14
Section 11.3 Audit. 15
ARTICLE 12 15
CAPITAL IMPROVEMENTS 15
Section 12.1 Schedule of Capital Expenditures. 15
Section 12.2 Responsibility for Capital Expenditures. 15
ARTICLE 13 15
FACILITY CONTRACTS; TRANSACTIONS WITH AFFILIATES 15
Section 13.1 Existing Contracts. 15
Section 13.2 Execution of Contracts 15
Section 13.3 Transactions with Affiliates. 16
ARTICLE 14 16
AGREEMENT MONITORING AND GENERAL MANAGER 16
Section 14.1 Contract Administrator. 16
ARTICLE 15 16
INDEMNIFICATION 16
Section 15.1 Indemnification by Manager 16
Section 15.2 Indemnification by the Owner. 17
Section 15.3 Conditions to Indemnification. 17
Section 15.4 Survival. 17
ARTICLE 16 17
INSURANCE 17
Section 16.1 Types and Amount of Coverage. 17
Section 16.2 Rating; Additional Insureds. 18
ARTICLE 17 18
REPRESENTATIONS, WARRANTIES AND COVENANTS 18
Section 17.1 Manager Representations and Warranties. 18
Section 17.2 Owner Representations, Warranties and Covenants. 19
ARTICLE 18 19
MISCELLANEOUS 19
Section 18.1 No Discrimination 19
Section 18.2 Use of Facility Names and Logos. 19
Section 18.3 Facility Advertisements. 19
Section 18.4 Force Majeure; Casualty Loss. 20
Section 18.5 Assignment. 20
Section 18.6 Notices. 20
Section 18.7 Severability. 21
Section 18.8 Prior Agreements. 21
Section 18.9 Governing Law. 21
Section 18.10 Amendments. 21
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Section 18.11 Waiver; Remedies. 21
Section 18.12 Relationship of Parties. 22
Section 18.13 No Third Party Beneficiaries 22
Section 18.14 Attorney Fees 22
Section 18.15 Limitation on Damages 22
Section 18.16 Counterparts; Facsimile and Electronic Signatures. 22
EXHIBIT A -1 24
PRE- OPENING DUTIES 24
EXHIBIT A -2 27
POST - OPENING DUTIES 27
EXHIBIT B 30
EXISTING CONTRACTS 30
EXHIBIT C 31
INSURANCE 31
EXHIBIT D 33
PRE - OPENING EXPENSE BUDGET .34
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PRE- OPENING SERVICES AND MANAGEMENT AGREEMENT
This Pre - Opening Services and Management Agreement is entered into on the 14th day
of May, 2012, and made effective as of April 1, 2012 ( "Effective Date "), by and between City of
Pueblo, a Municipal corporation ( "Owner "), and Global Spectrum, LP, a Delaware limited
partnership ( "Manager ").
RECITALS
WHEREAS, the Owner owns a multi - purpose auditorium located in Pueblo, Colorado
currently known as Memorial Hall (the "Facility ");
WHEREAS, the Facility will be undergoing renovations and repairs which are
anticipated to be substantially complete in or around May 2013;
WHEREAS, the Owner desires to engage Manager to provide certain pre- opening
consulting services, and to manage and operate the Facility on behalf and for the benefit of the
Owner, and Manager desires to accept such engagement, pursuant to the terms and conditions
contained herein; and
NOW THEREFORE, for and in consideration of the foregoing, the mutual covenants and
promises hereinafter set forth and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties, hereby agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1. Definitions. For purposes of this Agreement, the following terms have the
meanings referred to in this Section:
"Affiliate ": A person or company that directly or indirectly, through one or more
intermediaries, controls or is controlled by, or is under common control with, a specified person
or company.
"Agreement ": The "Agreement" shall mean this Management Agreement,
together with all exhibits attached hereto (each of which are incorporated herein as an integral
part of this Agreement).
"Capital Expenditures ": All expenditures for building additions, alterations,
repairs or improvements and for purchases of additional or replacement furniture, machinery, or
equipment, where the cost of such expenditure is greater than $5,000 and the depreciable life of
the applicable item is, according to generally accepted accounting principles, is in excess of five
(5) years.
"Commercial Rights ": Naming rights, pouring rights, advertising, sponsorships,
the branding of food and beverage products for resale, premium seating (including suites, club
seats and party suites) and memorial gifts at or with respect to the Facility and owned or
controlled by the Owner.
"CPI ": The "Consumer Price Index" for the Denver - Boulder - Greeley area, as
published by the United States Department of Labor, Bureau of Labor Statistics or such other
successor or similar index.
"Effective Date ": "Effective Date" shall have the meaning ascribed to such term
in the opening paragraph of this Agreement.
"Emergency Repair ": The repair of a condition which, if not performed
immediately, creates an imminent danger to persons or property and /or an unsafe condition at the
Facility threatening persons or property.
"Event Account ": A separate interest - bearing account in the name of the Owner
and under the Owner's Federal ID number in a local qualified public depository, to be designated
by the Owner, where advance ticket sale revenue is deposited by Manager.
"Event of Force Majeure ": An act of God, fire, earthquake, hurricane, flood,
riot, civil commotion, terrorist act, terrorist threat, storm, washout, wind, lightning, landslide,
explosion, epidemic, hostilities or war, a labor dispute which results in a strike or work stoppage
affecting the Facility or services described in this Agreement, or any other cause or occurrence
outside the reasonable control of the party claiming an inability to perform and which by the
exercise of due diligence could not be reasonably prevented or overcome.
"Existing Contracts ": Service Contracts, Revenue Generating Contracts, and
other agreements relating to the day -to -day operation of the Facility existing as of the Effective
Date, as set forth on Exhibit B attached hereto.
"Facility ": The "Facility" shall have the meaning ascribed to such term in the
Recitals to this Agreement, and shall be deemed to include the entire auditorium, including but
not limited to the stage, auditorium seating areas, dressing rooms, box office, common areas,
lobby areas, storage and utility facilities, and the entrances, ground, sidewalks and parking areas
immediately surrounding the Facility and adjacent thereto.
''FF &E ": Furniture, fixtures and equipment to be procured for use at the Facility.
"Fixed Management Fee ": The fixed monthly fee the Owner shall pay to
Manager under this Agreement, as more fully described in Section 3.1 of this Agreement.
"General Manager ": The employee of Manager acting as the full -time on -site
general manager of the Facility.
"Incentive Fee ": The contingent fee the Owner shall pay to Manager under this
Agreement, if earned, as more fully described in Section 3.2 below.
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"Laws ": federal, state, local and municipal laws, statutes, rules, regulations and
ordinances.
"Management -Level Employees ": Employees of Manager, which may include
the General Manager, Assistant General Manager, Business Manager (or employees with
different titles performing similar functions) and any department head employed by Manager to
perform services at the Facility (including, if applicable, employees performing the function of
the Director of Operations, Director of Sales and Marketing, Director of Security, Finance
Director and Event Manager).
"Manager ": The term "Manager" shall have the meaning ascribed to such term
in the Recitals to this Agreement.
"Marketing Plan ": A plan for the advertising and promotion of the Facility and
Facility events, which may contain but not be limited to the following elements: (i) market
research, (ii) market position, (iii) marketing objectives, (iv) marketing strategies, (v) booking
priorities, (vi) targeted events - local, regional, national and international, (vii) targeted meetings,
conventions and trade shows, (viii) industry advertising campaign, (ix) internal and external
support staff, (x) advertising opportunities at the local, regional and national level, (xi)
attendance at various trade shows, conventions and seminars, (xii) incentive formulas for
multiple event presenters, (xiii) suite and club seat sales, (xiv) merchandising and retail, (xv)
food and beverage, (xvi) a plan for the sale of commercial rights, including without limitation
naming rights, pouring rights, advertising signage, sponsorships (including event sponsorships),
branding of food and beverage products for resale, premium seating (including but not limited to
suites and club seats), and memorial gifts, (xvii) a plan regarding national, regional and local
public relations and media relations, (xviii) development of an in -house advertising agency, and
(xix) policies regarding the use of trade /barter.
"Opening Date ": The date on which the Facility is first reopened to the public
after substantial completion of the renovations for a paid and /or ticketed event (estimated to be in
or around May, 2013, but subject to change). Once the Opening Date is established, it shall be
acknowledged by both parties in writing.
"Operating Account ": A separate interest - bearing account in the name of the
Owner and under the Owner's Federal ID number in a local qualified public depository, to be
designated by the Owner, where Revenue is deposited and from which Operating Expenses are
paid.
"Operating Budget ": A line item budget for the Facility that includes a
projection of Revenues and Operating Expenses, presented on a monthly and annual basis.
"Operating Expenses ": All expenses reasonably incurred by Manager in
connection with its operation, promotion, maintenance and management of the Facility,
including but not limited to the following: (i) employee payroll, benefits, bonus and related costs
and, if specifically approved by Owner on a case by case basis (which approval may be granted,
withheld or delayed at Owner's sole and absolute discretion), relocation expense, (ii) cost of
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operating supplies, including general office supplies, (iii) advertising, marketing, group sales,
and public relations costs, (iv) cleaning expenses, (v) data processing costs, (vi) dues,
subscriptions and membership costs, (vii) the Fixed Management Fee, (viii) printing and
stationary costs, (ix) postage and freight costs, (x) equipment rental costs, (xi) minor repairs,
maintenance, and equipment servicing, not including expenses relating to performing capital
improvements or repairs, (xii) security expenses, (xiii) telephone and communication charges,
(xiv) reasonable travel expenses of Manager employees, (xv) reasonable meal expense
necessarily incurred by Manager employees as part of Manager's marketing and sales; (xvi) cost
of employee uniforms and identification, (xvii) exterminator, snow and trash removal costs, if
applicable (xviii) computer, software, hardware and training costs, (xix) parking expenses, (xx)
utility expenses, (xxi) office expenses, (xxii) audit and accounting fees, (xxiii) legal fees, (xxiv)
all bond and insurance costs, including but not limited to personal property, liability, and
worker's compensation insurance, (xxv) commissions and all other fees payable to third parties
(e.g. commissions relating to food, beverage and merchandise concessions services and
commercial rights sales), (xxvi) cost of complying with any Laws, (xxvii) costs incurred by
Manager to settle or defend any claims asserted against Manager arising out of its operations at
the Facility on behalf of Owner, except for costs attributable to the negligent or intentional acts
or omissions of Manager or its employees; (xxviii) costs incurred under Service Contracts and
other agreements relating to Facility operations, and (xxix) Taxes. The term "Operating
Expenses" does not include debt service on the Facility, Capital Expenditures or the Incentive
Fee.
"Operating Year ": Each twelve (12) month period during the Term,
commencing on the Opening Date and continuing on the anniversary of such date.
"Operations Manual ": Document to be developed by Manager which shall
contains terms regarding the management and operation of the Facility, including detailed
policies and procedures to be implemented in operating the Facility, as agreed upon by both the
Owner and the Manager.
"Owner ": The term "Owner" shall have the meaning ascribed to such term in the
Recitals to this Agreement.
"Pre- Opening Expense Account ": A separate interest - bearing account in the
name of the Owner and under the Owner's Federal ID number in a local qualified public
depository, to be designated by the Owner, into which the Owner deposits in advance funds for
the payment of Pre - Opening Expenses, and from which Manager may draw to pay such Pre -
Opening Expenses.
"2012 Pre - Opening Expense Budget ": The budget attached hereto as Exhibit D,
which details the projected Pre - Opening Expenses of Manager from the Effective Date through
December 31, 2012.
"Pre- Opening Expenses ": The actual labor expense (including without
limitation salary, benefits, 401(k) employer matching contributions, bonus and related costs and,
if specifically approved by Owner on a case by case basis, which approval may be granted,
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withheld or delayed at Owner's sole and absolute discretion, relocation costs), insurance costs,
and other reasonable operating costs and expenses of Manager, as well as reasonable out -of-
pocket travel costs (airfare, ground transportation, meals and lodging) of Manager's corporate
personnel, in connection with its obligations hereunder during the Pre - Opening Period.
"Pre- Opening Period ": Period of time beginning on the Effective Date and
ending on the Opening Date.
"Revenue ": All revenues generated by Manager's operation of the Facility,
including but not limited to event ticket proceeds income, rental and license fee income,
merchandise income, gross food and beverage income, gross income from any sale of
Commercial Rights, gross service income, equipment rental fees, box office income, and
miscellaneous operating income, but shall not include event ticket proceeds held by Manager in
trust for a third party and paid to such third party.
"Revenue Generating Contracts ": Vendor, concessions and merchandising
agreements, user /rental agreements, booking commitments, licenses, and all other contracts or
agreements generating revenue for the Facility and entered into in the ordinary course of
operating the Facility.
"Service Contracts ": Agreements for services to be provided in connection with
the operation of the Facility, including without limitation agreements for ticketing, web
development and maintenance, computer support services, FF &E purchasing services,
engineering services, electricity, steam, gas, fuel, general maintenance, HVAC maintenance,
telephone, staffing personnel including guards, ushers and ticket - takers, extermination, elevators,
stage equipment, fire control panel and other safety equipment, snow removal and other services
which are deemed by Manager to be either necessary or useful in operating the Facility. The
term of any Service Contract entered into by Manager shall not extend beyond the Term of this
Agreement, unless such contract, by its express terms, can be immediately terminated without a
waiting period by Manager or Owner following expiration of the Term without any penalty.
"Taxes ": Any and all governmental assessments, franchise fees, excises, license
and permit fees, levies, charges and taxes, of every kind and nature whatsoever, which at any
time during the Term may be assessed, levied, or imposed on, or become due and payable out of
or in respect of, (i) activities conducted on behalf of the Owner at the Facility, including without
limitation the sale of concessions, the sale of tickets, and the performance of events (such as any
applicable sales and /or admissions taxes, use taxes, excise taxes, occupancy taxes, employment
taxes and withholding taxes), or (ii) any payments received from any holders of a leasehold
interest or license in or to the Facility, from any guests, or from any others using or occupying all
or any part of the Facility.
"Term ": The term "Term" shall have the meaning ascribed to such term in
Section 4.1 of this Agreement.
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ARTICLE 2
SCOPE OF SERVICES
Section 2.1 Engagement.
(a) Owner hereby engages Manager during the Pre - Opening Period to
perform the pre - opening services described in Exhibit A -1 attached hereto.
(b) Owner hereby engages Manager following the Opening Date to act as the
sole and exclusive manager and operator of the Facility, subject to and as more fully described in
this Agreement, and, in connection therewith, to perform the services described in Exhibit A -2
attached hereto.
(c) Manager hereby accepts such engagement, and shall perform the services
described herein, subject to the limitations expressly set forth in this Agreement and in the
Operations Manual.
Section 2.2 Limitations on Manager's Duties. Manager's obligations under this
Agreement are contingent upon and subject to the Owner making available, in a timely fashion,
the funds budgeted for and /or reasonably required by Manager to carry out such obligations
during the Term. Manager shall not be considered to be in breach or default of this Agreement,
and shall have no liability to the Owner or any other party, in the event Manager does not
perform any of its obligations hereunder due to failure by the Owner to timely provide such
funds.
ARTICLE 3
COMPENSATION
Section 3.1 Fixed Management Fee. In consideration of Manager's performance of its
services hereunder, Owner shall pay Manger a Fixed Management Fee. Beginning on the
Effective Date and continuing through the Opening Date, the Fixed Management Fee shall be
One Thousand Dollars ($1,000.00) per month. Beginning on the Opening Date and continuing
through the first (1st) Operating Year, the Fixed Management Fee shall be One Thousand
Dollars ($1,000.00) per month. Beginning in the second (2nd) Operating Year, the Fixed
Management Fee shall be increased over the Fixed Management Fee from the previous
Operating Year in accordance with the percentage increase in the Consumer Price Index over the
previous twelve (12) month period Year (i.e., the difference, expressed as a percentage, between
the value of the CPI Index published most recently prior to the commencement of the preceding
Operating Year and the value of the CPI Index published most recently prior to the
commencement of the Operating Year for which the CPI adjustment will apply). The Fixed
Management Fee shall be payable to Manager in advance, beginning on the Effective Date, and
payable on the first (1st) day of each month thereafter (prorated as necessary for any partial
months). Manager shall be entitled to pay itself such amount from the Operating Account.
Section 3.2 Incentive Fee. In addition to the Fixed Management Fee, Manager shall
be entitled to receive an Incentive Fee each full or partial Operating Year of the Term. The
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Incentive Fee shall be equal to seven and one half percent (7.5 %) of gross food and beverage
sales (net of taxes only) and net merchandising commissions from all events held at the Facility,
or twelve thousand dollars ($12,000.00), whichever is less. The $12,000 amount in the
preceding sentence shall be increased by CPI each Operating Year, starting with the second (2
Operating Year. The Incentive Fee shall be paid to Manager no later than ninety (90) days
following the end of each Operating Year. In no event shall the Incentive Fee payable to
Manager in any Operating Year exceed the Fixed Fee paid to Manager in such year.
ARTICLE 4
TERM; TERMINATION
Section 4.1 Term.
(a) The term of this Agreement (the "Term ") shall begin on the Effective
Date, and, unless sooner terminated pursuant to the provisions of Section 4.2 below, shall expire
on the fifth (5` ) anniversary of the Opening Date, provided that Owner shall have the right to
terminate this Agreement without cause effective on the third (3 anniversary of the Opening
Date, by providing written notice to Manager at least ninety (90) days prior to such date.
(b) Prior to the end of the Term, at the request of either the Owner or the
Manager, the parties shall engage in discussions regarding a new agreement for the management
and operation of the Facility following the end of the Term; provided, however, that this
requirement to discuss a new management agreement shall not obligate either party to commit to
any such new agreement or to the terms of any such new agreement, and Owner may, in its sole
discretion, seek proposals from third - parties to manage and operate the Facility.
Section 4.2 Termination. This Agreement may be terminated (i) subject to Section
4.3(a) below, by Owner upon thirty (30) days written notice to Manager in the event of a
prolonged (at least 3 consecutive months) closure of the Facility, the fact of which is certified by
the Owner in writing to Manager, (ii) by Owner upon sixty (60) days written notice if in two (2)
consecutive Operating Years Manager fails to achieve at least ninety -five percent (95 %) of the
net bottom -line number (i.e., Revenue less Operating Expenses) in the Operating Budget for
such year, provided that such failure is not substantially due to an Event of Force Majeure, an
increase in costs outside the reasonable control of Manager (such as insurance, utilities, or
expenses associated with event contemplated under Section 5.4 below), or other substantial
change in the market place outside of Manager's reasonable control, (iii) by either party upon
thirty (30) days written notice, if the other party fails to perform or comply with any of the
material terms, covenants, agreements or conditions hereof, and such failure is not cured during
such thirty (30) day notification period, provided, however, if such failure cannot reasonably be
cured within such thirty (30) day period, then a longer period of time shall be afforded to cure
such breach, up to a total of ninety (90) days, provided that the party in default is diligently
seeking a cure and the non - defaulting party is not irreparably harmed by the extension of the cure
period, (iv) by either party immediately by written notice upon the other party being judged
bankrupt or insolvent, or if any receiver or trustee of all or any part of the business property of
the other party shall be appointed and shall not be discharged within one hundred twenty (120)
days after appointment, or if either party shall make an assignment of its property for the benefit
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of creditors or shall file a voluntary petition in bankruptcy or insolvency, or shall apply for
bankruptcy under the bankruptcy or insolvency Laws now in force or hereinafter enacted,
Federal, State or otherwise, or if such petition shall be filed against either party and shall not be
dismissed within one hundred twenty (120) days after such filing, or (v) by the Owner upon
thirty (30) days written notice that Owner failed to appropriate funds sufficient to discharge the
Owner's obligations under the Operating Budget and /or this Agreement.
Section 4.3 Effect of Termination
(a) In the event this Agreement is terminated by the Owner pursuant to
Section 4.2 (i) or 4.2(v), the Owner shall reimburse Manager for any actual and reasonable
ordinary and necessary expenses incurred by Manager in withdrawing from the provision of
services hereunder following such termination. Such ordinary and necessary expenses shall
include, without limitation, reasonable costs actually incurred by Manager in withdrawing from
the provision of services hereunder, such as those incurred in connection with the termination
and /or assignment of Service Contracts, Revenue Generating Contracts, or other contracts or
leases entered into by Manager pursuant to this Agreement, unless such Service Contracts,
Revenue Generating Contracts or other contracts or leases are assigned to, or assumed by Owner
or designee of Owner. The Owner's payment of such expenses will occur only after Manager
has provided sufficient evidence of the reasonable incurrence of such expenses. Except for the
reimbursement as provided above, Manager shall have no other right or remedy, at law or in
equity, against the Owner for a termination pursuant to Section 4.2 (i) or 4.2(v), except that, in
the event the Facility re -opens at any time during the Term, this Agreement shall, at the option of
Manager, once again become effective and Manager shall manage and operate the Facility under
the remaining term hereof
(b) Upon termination or expiration of this Agreement for any reason, (i)
Manager shall promptly discontinue the performance of all services hereunder, (ii) the Owner
shall promptly pay Manager all fees due Manager up to the date of termination or expiration
(subject to proration if the Term ends other than at the end of the Operating Year), (iii) Manager
shall make available to the Owner all data, electronic files, documents, procedures, reports,
estimates, summaries, and other such information and materials with respect to the Facility as
may have been accumulated by Manager in performing its obligations hereunder, whether
completed or in process, and (iv) without any further action on part of Manager or Owner, the
Owner shall, or shall cause the successor Facility manager to, assume all obligations arising after
the date of such termination or expiration, under any Service Contracts, Revenue Generating
Contracts, booking commitments and any other Facility agreements entered into by Manager in
furtherance of its duties hereunder. Any obligations of the parties that are specifically intended
to survive expiration or termination of this Agreement shall survive expiration or termination
hereof.
ARTICLE 5
OWNERSHIP; USE OF THE FACILITY
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Section 5.1 Ownership of Facility, Data, Equipment and Materials. The Owner will at
all times retain ownership of the Facility, including but not limited to real estate, technical
equipment, furniture, displays, fixtures and similar property, including improvements made
during the Term, at the Facility. Any data, equipment or materials furnished by the Owner to
Manager or acquired by Manager as an Operating Expense shall remain the property of the
Owner, and shall be returned to the Owner when no longer needed by Manager to perform under
this Agreement. Notwithstanding the above, Owner shall not have the right to use any third
party software licensed by Manager for general use by Manager at the Facility and other
facilities managed by Manager, the licensing fee for which is proportionately allocated and
charged to the Facility as an Operating Expense; such software may be retained by Manager
upon expiration or termination hereof upon reimbursement to Owner of the proportionate amount
(if any) pre -paid for such software as an Operating Expense for the Facility relating to the period
of time following such expiration or termination. Furthermore, the Owner recognizes that the
Operations Manual to be developed and used by Manager hereunder is proprietary to Manager,
and shall belong to Manager at the end of the Term; Owner shall not use or maintain copies
thereof upon the end of the Term.
Section 5.2 Right of Use by Manager. The Owner hereby gives Manager the right and
license to use the Facility, and Manager accepts such right of use, for the purpose of performing
the services herein specified, including the operation and maintenance of all physical and
mechanical facilities necessary for, and related to, the operation, maintenance and management
of the Facility. The Owner shall provide Manager with a sufficient amount of suitable office
space in the Facility and with such office equipment as is reasonably necessary to enable
Manager to perform its obligations under this Agreement. In addition, the Owner shall make
available to Manager, at no cost, up to seven parking spaces in the City's Public Parking Garage
for use by Manager's full -time employees and for the Facility's event staff. Owner may reserve,
for its own use, office space within the Facility.
Section 5.3 Observance of Agreements. Subject to the limitations of Section 8.5 of
this Agreement, the Owner agrees to perform all of its obligations under any leases, bonds,
debentures, loans and other financing and security agreements to which the Owner is bound in
connection with its ownership of the Facility in accordance with the terms and premises of those
instruments.
Section 5.4 Use by the Owner. Subject to availability, the Owner shall have the right
to use the Facility or any part thereof rent -fee for meetings, seminars, training classes or other
non - commercial uses, provided that the Owner shall promptly reimburse Manager, for deposit
into the Operating Account, for any out -of- pocket expenses incurred by Manager (such as the
cost of ushers, ticket - takers, set -up and take -down personnel, security expenses and other
expenses) in connection with such use. Such non - commercial use of the Facility by the Owner
shall (i) not compete with or conflict with the dates previously booked by Manager for paying
events, (ii) not consist of normally touring attractions (such as concerts and family shows), and
(iii) be booked in advance upon reasonable notice to Manager pursuant to the Facilities'
approved booking policies. Upon request of the Owner, Manager shall provide to the Owner a
list of available dates for Owner use of the Facility. To the extent that Manager has an
opportunity to book a revenue - producing event on a date which is otherwise reserved for use by
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the Owner, Manager may propose alternative dates for the Owner's event, and the Owner shall
use best efforts to reschedule its event to allow Manager to book the revenue - producing event.
ARTICLE 6
PERSONNEL
Section 6.1 Generally. All Facility staff and other personnel shall be engaged or hired
by Manager, and shall be employees, agents or independent contractors of Manager (or an
Affiliate thereof), and not of the Owner. Manager shall select, in its sole discretion but subject to
Owner's right to approve the Operating Budget, the number, function, qualifications, and
compensation, including salary and benefits, of its employees and shall control the terms and
conditions of employment (including without limitation termination thereof) relating to such
employees; provided, however, that Manager shall not employee any person at the Facility to
which Owner has reasonable objection, provided (a) Owner first discusses such objection with
Manager and allows Manager a reasonable opportunity to remedy the situation, and (b) such
objection is not based on discrimination prohibited by federal or state law or other illegal
reasons. Manager agrees to use reasonable and prudent judgment in the selection and
supervision of such personnel. Except as provided above, the Owner specifically agrees that
Manager shall be entitled to pay its employees, as an Operating Expense, bonuses and benefits in
accordance with Manager's then current employee manual, which may be modified by Manager
from time to time in its sole discretion. A copy of Manager's current employee manual shall be
provided to the Owner upon request.
Section 6.2 General Manager. Personnel engaged by Manager will include an
individual with managerial experience in similar facilities to serve as a full -time on -site General
Manager of the Facility. Hiring of the General Manager by Manager shall require the prior
approval of the Owner, which approval shall not be unreasonably withheld or delayed; provided,
however, in the event of a vacancy in the General Manager position, Manager may, upon notice
to the Owner, temporarily fill such position with an interim General Manager for up to ninety
(90) days without the necessity of obtaining the Owner's approval. The General Manager will
have general supervisory responsibility for Manager and will be responsible for day -to -day
operations of the Facility, supervision of employees, and management and coordination of all
activities associated with events taking place at the Facility.
Section 6.3 Allocation of Certain Employee Costs. Owner acknowledges that
Manager is currently engaged by Urban Renewal Authority of Pueblo, Colorado (the
"Authority ") to provide management services at the Pueblo Convention Center (the "Center ").
The parties acknowledge that Manager currently intends to provide the large majority of services
required to be provided hereunder at the Facility with personnel employed by Manager at the
Center, such as, for example, finance, operations, marketing, and event coordination services.
The costs of employing such personnel are funded by the Authority, and it is anticipated that the
Authority will require that Owner pay a reasonable portion of such costs in exchange for such
personnel being made available to perform services for the benefit of the Facility. Manager shall
coordinate with the Authority and Owner to arrange for a fair and reasonable allocation of such
employee costs to be billed to Owner as an Operating Expense, which allocation shall be
consistent with the approved Operating Budget. If the parties cannot agree on such allocation,
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the allocation to Owner shall be generally based on the amount of time such individuals expend
performing services at the Facility as a percentage of their overall work week, multiplied by the
costs incurred by the Authority of employing such individuals. If at any time during the Term
Manager ceases to operate the Center, the parties shall discuss in good faith changes to the
Operating Budget to account for the changed circumstances.
Section 6.4 Non - Solicitation/Non - Hiring. During the Term and for a period of one (1)
year after the end of the Term, neither Owner nor any of its Affiliates shall solicit for
employment, or hire, any of Manager's Management -Level Employees. The Owner
acknowledges that Manager will spend a considerable amount of time identifying, hiring and
training individuals to work in such positions, and that Manager will suffer substantial damages,
the exact amount of which would be difficult to quantify, if the Owner were to breach the terms
of this Section by hiring, or soliciting for employment, any of such individuals. Accordingly, in
the event of a breach or anticipated breach of this Section by the Owner, Manager shall be
entitled to equitable relief, including an injunction to enjoin and restrain the Owner from
continuing such breach, without the necessity of posting a bond, which relief shall be the
exclusive remedy and in lieu of all others.
ARTICLE 7
PRE- OPENING EXPENSES AND EXPENSE BUDGET
Section 7.1 Establishment of Pre - Opening Expense Budget. Attached hereto
as Exhibit D is the 2012 Pre - Opening Expense Budget, which details the projected 2012 Pre -
Opening Expenses to be incurred by Manager from the Effective Date through December 31,
2012. The 2012 Pre - Opening Expense Budget is deemed approved by the Owner by virtue of
the Owner's execution of this Agreement, but may be adjusted by Manager from time to time,
subject to the approval of the Owner and lawful appropriations for any expenditures required by
Owner thereunder. A separate 2013 Pre - Opening Budget covering the Pre - Opening Period from
January 1, 2013 through the Opening Date must be presented to Owner no later than September
1, 2012 for its review and approval.
Section 7.2 Funding of Expenses During Pre - Opening Period. The Owner shall pay
for all 2012 Pre - Opening Expenses incurred by Manager in connection with the performance of
its obligations under this Agreement, in accordance with this Article 7. Upon execution hereof,
the Owner shall establish the Pre - Opening Expense Account, and transfer to such account an
amount equal to the projected 2012 Pre - Opening Expenses for the first month (or portion
thereof), as set forth in the 2012 Pre - Opening Expense Budget. On or before the first day of each
succeeding month during the 2012 Pre - Opening Period, the Owner shall transfer to the Pre -
Opening Expense Account an amount equal to the projected 2012 Pre - Opening Expenses for
such month, as set forth in the 2012 Pre - Opening Expense Budget. Manager may access such
account periodically, as needed, for the purpose of withdrawing funds to pay 2012 Pre - Opening
Expenses, including without limitation the Fixed Management Fee. These same procedures will
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be followed for the 2013 Pre - Opening Expense Budget upon approval of the 2013 Pre - Opening
Expense Budget by the Owner.
ARTICLE 8
OPERATING BUDGET
Section 8.1 Establishment of Operating Budget. Manager agrees that at least 90 days
prior to the Opening Date in respect of the first Operating Year, and no less than 90 days prior to
the commencement of each subsequent Operating Year in respect of such year, it will prepare
and submit to the Owner its proposed Operating Budget for such year. Each annual Operating
Budget shall include Manager's good faith projection of Revenues and Operating Expenses,
presented on a monthly and annual basis, for the upcoming Operating Year. The Owner agrees
to provide Manager with all information in its actual possession reasonably necessary to enable
Manager to prepare each Operating Budget.
Section 8.2 Approval of Operating Budget. Each annual Operating Budget shall be
subject to the review and approval of the Owner. In order for the Owner to fully evaluate and
analyze such budgets or any other request by Manager relating to income and expenses, Manager
agrees to provide to the Owner such reasonable financial information relating to the Facility as
may be requested by the Owner from time to time. If extraordinary events occur during any
Operating Year that could not reasonably be contemplated at the time the corresponding
Operating Budget was prepared, Manager may submit a proposed amendment to such budget for
review and consideration by the Owner. If the Owner fails to approve any annual Operating
Budget (or any proposed amendment thereto), the Owner shall promptly provide Manager the
specific reasons therefor and its suggested modifications to Manager's proposed Operating
Budget or amendment in order to make it acceptable. The parties shall then engage in good faith
discussions and use reasonable efforts to attempt to resolve the matter to the mutual satisfaction
of the parties, including, if applicable, negotiation of a mutually acceptable modification to the
economic terms of this Agreement to enable the Manager to achieve the compensation
contemplated by Article 3 of this Agreement.
Section 8.3 Adherence to Operating Budget. Manager shall use all reasonable efforts to
manage and operate the Facility in accordance with the Operating Budget. Without the prior
consent of the Owner, Manager shall not exceed, commit or contract to expend any sums in
excess of the aggregate amounts allowed in the Operating Budget or otherwise approved by
Owner, except for (i) additional expenditures necessary to perform an Emergency Repair, in
which event Manager shall notify Owner prior to making such repair, (ii) increased costs
resulting from the scheduling by Manager of additional revenue producing events or activities at
the Facility not contemplated by the Operating Budget in effect for such Operating Year; (iii)
expenses for services or utilities provided to the Facility by unaffiliated third parties, the cost of
which is not within the reasonable control of Manager, such as costs of utilities and insurance;
and (iv) increased costs resulting from events scheduled pursuant to Section 5.4 Manager agrees
to notify the Owner within 30 days of any significant change or variance in the bottom line
number in the Operating Budget, or any material increase in total Facility expenses from that
provided for in the Operating Budget. In either such case and if requested by Owner, Manager
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agrees to work with Owner to develop a plan (or changes to the then current plan), subject to
Owner's approval, to limit Operating Expense to be incurred in the remaining months of such
Operating Year, or to increase Revenues in the remaining months of the Operating Year, with the
goal of achieving the results contemplated in the Operating Budget. After such plan is developed
and approved by Owner, Manager shall take all reasonable steps to implement such plan.
Section 8.4 Annual Net Profit /Loss; "At Risk" Events. Manager shall use best efforts to
operate the Facility to maximize Revenue and minimize Operating Expenses. Any net profit will
be paid to the City, or deposited into a separate City account as may be directed by the City,
within thirty (30) days of the end of any Operating Year. Manager shall obtain written Owner
approval before booking any "at risk" events. An "at risk" event is one in which Owner is not
guaranteed to cover Operating Expenses and thus could result in a net loss to the Facility (such
as an in -house promoted, or certain co- promoted, events).. Owner shall assume the risk for, and
agrees to pay into the Operating Account funds sufficient to cover the net loss (Revenue less
Operating Expenses) for an "at risk" event for which it gave its prior written approval.
Section 8.5 Non - appropriations Provision. This Agreement is expressly made subject to the
limitations of the Colorado Constitution. Nothing herein shall constitute, nor deemed to
constitute, the creation of a debt or multi -year fiscal obligation or an obligation of future
appropriations by the City Council of Pueblo, contrary to Article X, § 20 Colorado Constitution
or any other constitutional, statutory or charter debt limitation. Notwithstanding any other
provision of this Agreement, with respect to any financial obligation of the City which may arise
under this Agreement in any fiscal year after 2012, in the event the budget or other means of
appropriations for any such year fails to provide funds in sufficient amounts to discharge such
obligation, such failure shall not constitute a default or breach of this Agreement, including any
sub - agreement, attachment, schedule, or exhibit thereto, by the City.
ARTICLE 9
PROCEDURE FOR HANDLING INCOME
Section 9.1 Event Account. Manager shall comply with all laws regulating ticket
sales, and shall deposit as soon as practicable following receipt, in the Event Account, all
revenue received from ticket sales and similar event - related revenues which Manager receives in
contemplation of, or arising from, an event, pending completion of the event. Such monies will
be held in escrow for the protection of ticket purchasers, the Owner and Manager, to provide a
source of funds as required for payments to performers and for payments of direct incidental
expenses in connection with the presentation of events that must be paid prior to or
contemporaneously with such events. Promptly following completion of such events Manager
shall remit any sales tax and admissions tax collected to the applicable taxing authority. Manager
shall transfer all funds remaining in the Event Account, including any interest accrued thereon,
into the Operating Account. Bank service charges, if any, on such account(s) shall be deducted
from interest earned.
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Section 9.2 Operating Account. Except as provided in Section 9.1, all Revenue
derived from operation of the Facility shall be deposited by Manager into the Operating Account
as soon as practicable upon receipt (but not less often than once each business day). The specific
procedures (and authorized individuals) for making deposits to and withdrawals from such
account shall follow generally accepted business practices and be set forth in the Operations
Manual, but the parties specifically agree that Manager shall have authority to sign checks and
make withdrawals from such account, subject to the limitations of this Agreement, without
needing to obtain the co- signature of a Owner employee or representative.
ARTICLE 10
FUNDING
Section 10.1 Source of Funding. Following the Opening Date, Manager shall pay all
valid items of expense for the operation, maintenance, supervision and management of the
Facility from the funds in the Operating Account, which Manager may access periodically for
this purpose. The Operating Account shall be funded with amounts generated by operation of
the Facility (as described in Article 8 above), or otherwise made available by the Owner. Subject
to lawful appropriations therefor, to ensure sufficient funds are available in the Operating
Account, Owner will deposit in the Operating Account, on or before the Opening Date, the
budgeted or otherwise approved expenses for the month beginning on the Opening Date. The
Owner shall thereafter, on or before the 1st day of each succeeding month following the Opening
Date, deposit (or allow to remain) in the Operating Account the budgeted or otherwise approved
expenses for each such month. Manager shall have no liability to the Owner or any third party in
the event Manager is unable to perform its obligations hereunder, or under any third party
contract entered into pursuant to the terms hereof, due to the fact that sufficient funds are not
made available to Manager to pay such expenses in a timely manner.
Section 10.2 Advancement of Funds. Under no circumstances shall Manager be
required to pay for or advance any of its own funds to pay for any Operating Expenses. In the
event that, notwithstanding the foregoing, Manager agrees to advance its own funds to pay
Operating Expenses, Owner shall promptly reimburse Manager for the full amount of such
advanced funds, plus interest at a rate to be mutually agreed.
ARTICLE 11
FISCAL RESPONSIBILITY; REPORTING
Section 11.1 Records. Manager agrees to keep and maintain, at its office in the Facility,
separate and independent records, in accordance with generally accepted accounting principles,
devoted exclusively to its operations in connection with its management of the Facility. Such
records (including books, ledgers, journals, and accounts) shall contain all entries reflecting the
business operations of Manager under this Agreement. The Owner or its authorized agent shall
have the right to audit and inspect such records from time to time during the Term, upon
reasonable notice to Manager and during Manager's ordinary business hours.
Section 11.2 Monthly Financial Reports. Manager agrees to provide to the Owner,
within thirty (30) days after the end of each month during the Term, financial reports for the
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Facility including a balance sheet, aging report on accounts receivable, and statement of
revenues and expenditures (budget to actual) for such month and year to date in accordance with
generally accepted accounting principles. In addition, Manager agrees to provide to the Owner a
summary of bookings for each such month, and separate cash receipts and disbursements reports
for each event held at the Facility during such month. Additionally, Manager shall submit to the
Owner, or shall cause the applicable public depository utilized by Manager to submit to the
Owner, on a monthly basis, copies of all bank statements concerning the Event Account and the
Operating Account.
Section 11.3 Audit. Manager agrees to provide to the Owner, within one hundred
twenty (120) days following the end of each Operating Year, a certified audit report on the
accounts and records as kept by Manager for the Facility. Costs associated with obtaining such
certified audit report shall be an Operating Expense of the Facility. Such audit shall be
performed by an external auditor approved by the Owner, and shall be conducted in accordance
with generally accepted auditing standards.
ARTICLE 12
CAPITAL IMPROVEMENTS
Section 12.1 Schedule of Capital Expenditures. Manager shall annually, at the time of
submission of the annual Operating Budget to the Owner, provide to the Owner a schedule of
proposed capital improvements to be made at the Facility, for the purpose of allowing the Owner
to consider such projects and to prepare and update a long -range Capital Expenditure budget.
Section 12.2 Responsibility for Capital Expenditures. The Owner shall be solely
responsible for all Capital Expenditures at the Facility; provided, however, the Owner shall be
under no obligation to make any Capital Expenditures proposed by Manager, and provided
further that Manager shall have no liability for any claims, costs or damages arising out of a
failure by the Owner to make any Capital Expenditures. Notwithstanding the foregoing,
Manager shall have the right (but not the obligation), upon notice to the Owner, and after
consultation with Owner's City Manager (if practicable under the circumstances), to make
Capital Expenditures at the Facility for Emergency Repairs. In such event, the Owner shall
promptly reimburse Manager for the cost of such Capital Expenditure.
ARTICLE 13
FACILITY CONTRACTS; TRANSACTIONS WITH AFFILIATES
Section 13.1 Existing Contracts. The Owner shall provide to Manager, on or before the
Effective Date, copies of all Existing Contracts, if any. Manager shall administer and assure
compliance with such Existing Contracts.
Section 13.2 Execution of Contracts. Manager shall have the right to enter into Service
Contracts, Revenue Generating Contracts and other contracts related to the operation of the
Facility, as agent on behalf of the Owner. The Owner retains the right to review any and all
contracts relating to the operations of the Facility, including, without limitation, the agreements
described in Section 13.3, provided that Manager shall have the right to enter into event
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contracts, without Owner approval, provided such contracts are materially in the form of event
contract (as applicable) template approved by Owner in advance. All such agreements, including
those described in Section 13.3, shall be on Pueblo - area - market -rate terms. Any such material
agreements shall contain standard indemnification and insurance obligations on the part of each
vendor, licensee or service provider, as is customary for the type of services or obligations being
provided or performed by such parties. Manager shall obtain the prior written approval of the
Owner, which may be granted, withheld or delayed, in Owner's sole and absolute discretion,
before entering into any Service Contract with a term that expires after the Term of this
Agreement, unless such contract, by its express terms, can be immediately terminated without a
waiting period by Manager or Owner following expiration of the Term without any penalty.
Section 13.3 Transactions with Affiliates. In connection with its obligations hereunder
relating to the purchase or procurement of services for the Facility (including without limitation
food and beverage services, ticketing services, Commercial Rights sales, web design services
and graphic design services), Manager may purchase or procure such services, or otherwise
transact business with, an Affiliate of Manager, provided that the prices charged and services
rendered by such Affiliate are competitive with those obtainable from any unrelated parties
rendering comparable services. Manager shall, at the request of the Owner, provide reasonable
evidence establishing the competitive nature of such prices and services, including, if
appropriate, competitive bids from other persons seeking to render such services at the Facility.
ARTICLE 14
AGREEMENT MONITORING AND GENERAL MANAGER
Section 14.1 Contract Administrator. Each party shall appoint a contract administrator
who shall monitor such party's compliance with the terms of this Agreement. Manager's
contract administrator shall be its General Manager at the Facility, unless Manager notifies
Owner of a substitute contract administrator in writing. Owner shall notify Manager of the name
of its contract administrator within thirty (30) days of execution hereof, but upon any failure to
do so, the City Manager of Owner shall be deemed to be its contract administrator. Owner may
at any time name a substitute contract administrator by providing notice of same in writing to
Manager. Any and all references in this Agreement requiring Manager or Owner participation or
approval shall mean the participation or approval of such party's contract administrator, except
with respect to Owner where such approval references adoption of a budget or an appropriations
of funds.
ARTICLE 15
INDEMNIFICATION
Section 15.1 Indemnification by Manager. Manager agrees to defend, indemnify and
hold harmless the Owner and its officials, directors, officers, employees, agents, successors and
assigns against any claims, causes of action, costs, expenses (including reasonable attorneys'
fees) liabilities, or damages (collectively, "Losses ") suffered by such parties, arising out of or in
connection with any (a) negligent act or omission, or intentional misconduct, on the part of
Manager or any of its employees or agents in the performance of its obligations under this
16
Agreement, or (b) breach by Manager of any of its representations, covenants or agreements
made herein.
Section 15.2 Indemnification by the Owner. To the extent permitted by law, Owner
agrees to defend, indemnify and hold harmless Manager, its parent, subsidiary and affiliate
companies, and each of their respective directors, officers, employees, agents, successors and
assigns, against any Losses suffered by such parties, which arise out of or in connection with (a)
any negligent act or omission on the part of Owner or any of its employees or agents in the
performance of its obligations under this Agreement, (b) a breach by Owner of any of its
representations, covenants or agreements made herein.
Section 15.3 Conditions to Indemnification. With respect to each separate matter
brought by any third party against which a party hereto ( "Indemnitee ") is indemnified by the
other party ( "Indemnitor ") under this Article 15, the Indemnitor shall be responsible, at its sole
cost and expense, for controlling, litigating, defending and /or otherwise attempting to resolve
any proceeding, claim, or cause of action underlying such matter, except that (a) the Indemnitee
may, at its option, participate in such defense or resolution at its expense and through counsel of
its choice; (b) the Indemnitee may, at its option, assume control of such defense or resolution if
the Indemnitor does not promptly and diligently pursue such defense or resolution, provided that
the Indemnitor shall continue to be obligated to indemnify the Indemnitee hereunder in
connection therewith; and (c) neither Indemnitor nor Indemnitee shall agree to any settlement
without the other's prior written consent (which shall not be unreasonably withheld or delayed).
In any event, Indemnitor and Indemnitee shall in good faith cooperate with each other and their
respective counsel with respect to all such actions or proceedings, at the Indemnitor's expense.
With respect to each and every matter with respect to which any indemnification may be sought
hereunder, upon receiving notice pertaining to such matter, Indemnitee shall promptly (and in no
event more than twenty (20) days after any third party litigation is commenced asserting such
claim) give reasonably detailed written notice to the Indemnitor of the nature of such matter and
the amount demanded or claimed in connection therewith.
Section 15.4 No Third -Party Beneficiaries. Nothing in this Article 15 is intended, nor
should it be construed, to create or extend any rights, claims or benefits or assume any liability
for or on behalf of any third party, or to waive any immunities or limitations otherwise conferred
upon Owner under or by virtue of federal or state law, including but not limited to the Colorado
Governmental Immunity Act, C.R.S. §24 -10 -101, et. seq.
Section 15.5 Survival. The obligations of the parties contained in this Article 15 shall
survive the termination or expiration of this Agreement.
ARTICLE 16
INSURANCE
Section 16.1 Types and Amount of Coverage. Manager agrees to obtain insurance
coverage in the manner and amounts as set forth in Exhibit C attached hereto, and shall provide
to the Owner promptly following the Effective Date a certificate or certificates of insurance
evidencing such coverage. Manager shall maintain such referenced insurance coverage at all
17
times during the Term, and will not make any material modification or change from these
specifications without the prior approval of the Owner. Each insurance policy shall include a
requirement that the insurer provide Manager and the Owner at least thirty (30) days written
notice of cancellation or material change in the terms and provisions of the applicable policy.
The cost of all such insurance shall be an Operating Expense.
Section 16.2 Rating; Additional Insureds. All insurance policies shall be issued by
insurance companies rated no less than A VIII in the most recent "Bests" insurance guide, and
authorized to issue such types of insurance in the State of Colorado or as otherwise agreed by the
parties. All such policies shall be in such form and contain such provisions as are generally
considered standard for the type of insurance involved. The commercial general liability policy,
automobile liability insurance policy (as applicable) and umbrella or excess liability policy to be
obtained by Manager hereunder shall name Owner as an additional insured and contain a waiver
of subrogation rights against Owner. The workers compensation policy to be obtained by
Manager hereunder shall also contain a waiver of all rights of subrogation against the Owner.
Manager shall require that all third -party users of the Facility, including without limitation third -
party licensees, ushers, security personnel and concessionaires, provide certificates of insurance
evidencing insurance appropriate for the types of activities in which such user is engaged. If
Manager subcontracts any of its obligations under this Agreement, Manager shall require each
such subcontractor to secure insurance that will protect against applicable hazards or risks of loss
as and in the minimum amounts designated herein, and name Manager and the Owner as
additional insureds.
ARTICLE 17
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 17.1 Manager Representations and Warranties. Manager hereby represents,
warrants and covenants to Owner as follows:
(a) that it has the full legal right, power and authority to enter into this
Agreement and to grant the rights and perform the obligations of Manager herein, and that no
third party consent or approval is required to grant such rights or perform such obligations
hereunder; and
(b) that this Agreement has been duly executed and delivered by Manager and
constitutes a valid and binding obligation of Manager, 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.
(c) that Manager will comply with all Laws applicable to its management of
the Facility, provided that Manager shall not be required to undertake any compliance activity,
nor shall Manager have any liability under this Agreement therefor, if such activity requires any
Capital Expenditure.
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Section 17.2 Owner Representations, Warranties and Covenants. Owner represents,
warrants and covenants to Manager as follows:
(a) that it has the full legal right, power and authority to enter into this
Agreement and to grant the rights and perform the obligations of Owner herein, and that no other
third party consent or approval is required to grant such rights or perform such obligations
hereunder.
(b) that this Agreement has been duly executed and delivered by Owner and
constitutes a valid and binding obligation of Owner, 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.
(c) that, to the best of Owner's actual knowledge, the Facility will be
constructed and completed in compliance in all respects with all applicable Laws relating to the
construction, use and operation of the Facility (including, without limitation, Title III of the
American with Disabilities Act), and without any structural defects.
ARTICLE 18
MISCELLANEOUS
Section 18.1 No Discrimination. Manager agrees that it will not discriminate against
any employee or applicant for employment for work under this Agreement because of race,
religion, color, sex, disability, national origin, ancestry, physical handicap, sexual preference, or
age, and will take affirmative steps to ensure that applicants are employed, and employees are
treated during employment, without regard to race, religion, color, sex, disability, national origin,
ancestry, physical handicap, sexual preference, or age.
Section 18.2 Use of Facility Names and Logos. Manager shall have the right to use
throughout the Term (and permit others to use in furtherance of Manager's obligations
hereunder), for no charge, the name and all logos of the Facility, on Manager's stationary, in its
advertising of the Facility, and whenever conducting business of the Facility; provided, that
Manager shall take all prudent and appropriate measures to protect the intellectual property
rights of the Owner relating to such logos. All intellectual property rights in any Facility logos
developed by the Manager or the Owner shall be and at all times remain the sole and exclusive
property of the Owner. Manager agrees to execute any documentation requested by the Owner
from time to time to establish, protect or convey any such intellectual property rights.
Section 18.3 Facility Advertisements. The Owner agrees that in all advertisements
placed by the Owner for the Facility or events at the Facility, whether such advertisements are in
print, on radio, television, the internet or otherwise, it shall include a designation that the Facility
is a "Global Spectrum managed facility" in a font size which is significantly smaller than any
other text in such advertising.
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Section 18.4 Force Majeure; Casualty Loss.
(a) Neither party shall be liable or responsible to the other party for any delay,
loss, damage, failure or inability to perform under this Agreement due to an Event of Force
Majeure, provided that the party claiming failure or inability to perform provides written notice
to the other party within thirty (30) days of the date on which such party gains actual knowledge
of such Event of Force Majeure. Notwithstanding the foregoing, in no event shall a party's
failure to make payments due hereunder be excusable due to an Event of Force Majeure.
(b) In the event of damage or destruction to a material portion of the Facility
by reason of fire, storm or other casualty loss that renders the Facility (or a material portion
thereof) untenantable, the Owner shall use reasonable efforts to remedy such situation. If
notwithstanding such efforts, such damage or destruction is expected to render the Facility (or a
material portion thereof) untenantable for a period estimated by an architect selected by the
Owner at Manager's request, of at least one hundred eighty (180) days from the date of such fire,
storm or other casualty loss, either party may terminate this Agreement upon written notice to the
other, provided that (i) the Owner shall pay to Manager its costs of withdrawing from services
hereunder, as described in Section 4.3(a) above, and (ii) in the event the Facility once again
becomes tenable at any time during the Term, this Agreement shall, at the option of Manager,
once again become effective and Manager shall manage and operate the Facility under the terms
hereof, except that the Term shall be extended for a period of time in which the Facility was
closed.
Section 18.5 Assignment. Manager shall not assign this Agreement without the prior
written consent of the Owner, except that Manager may, without the prior written consent of the
Owner but upon at least 30 days' written notice to the other party, assign this Agreement in
connection with a sale of all or substantially all its assets or equity interests, and Manager may
assign this Agreement to an affiliate, parent or subsidiary of Manager where such assignment is
intended to accomplish an internal corporate purpose of Manager as opposed to materially and
substantially altering the method of delivery of services to Owner. To obtain such consent where
needed as specified above, Manager shall (a) submit to Owner all information reasonably
requested by Owner which relates to the proposed assignee's financial and other capabilities to
fully perform under this Agreement, and (b) reimburse Owner for its costs in documented time
spent reviewing the request for the assignment, calculated at the rate of $250 per hour per City
attorney, and the hourly salary rate (based on a 40 hour work week) for non - attorney full -time
City employees (in each case, pro -rated for any portions of an hour), up to a maximum amount
of $5,000.00. Where Owner has the right to approve an assignment, Owner may decline to
consent to such assignment if it appears to Owner that the proposed assignee lacks either the
financial capability or the experience necessary to undertake Manager's obligations under this
Agreement. Any purported assignment in contravention of this Section shall be void.
Section 18.6 Notices. All notices required or permitted to be given pursuant to this
Agreement shall be in writing and delivered personally or sent by registered or certified mail,
return receipt requested, or by generally recognized, prepaid, overnight air courier services, to
the address and individual set forth below. All such notices to either party shall be deemed to
have been provided when delivered, if delivered personally, three (3) days after mailed, if sent by
20
registered or certified mail, or the next business day, if sent by generally recognized, prepaid,
overnight air courier services.
If to the Owner: If to Manager:
City Manager Global Spectrum, L.P.
200 South Main Street 3601 S. Broad Street
Pueblo, CO 81003 Philadelphia, PA 19148 -5290
Attn: Chief Operating Officer
With a copy to: With a copy to:
City Attorney Comcast Spectacor, L.P.
503 North Main Street, Suite 203 3601 South Broad Street
Pueblo, CO 81003 Philadelphia, PA 19148 -5290
Attn: General Counsel
The designation of the individuals to be so notified and the addresses of such parties set forth
above may be changed from time to time by written notice to the other party in the manner set
forth above.
Section 18.7 Severability. If a court of competent jurisdiction determines that any term
of this Agreement is invalid or unenforceable to any extent under applicable law, the remainder
of this Agreement (and the application of this Agreement to other circumstances) shall not be
affected thereby, and each remaining term shall be valid and enforceable to the fullest extent
permitted by law.
Section 18.8 Entire Agreement. This Agreement (including the exhibits attached
hereto) contains the entire agreement between the parties with respect to the subject matter
hereof, and supersedes and replaces all prior negotiations, correspondence, conversations,
agreements, and understandings concerning the subject matter hereof. Accordingly, the parties
agree that no deviation from the terms hereof shall be predicated upon any prior representations,
agreements or understandings, whether oral or written.
Section 18.9 Governing Law. The Agreement is entered into under and pursuant to,
and is to be construed and enforceable in accordance with, the laws of the State of Colorado,
without regard to its conflict of laws principles.
Section 18.10 Amendments. Neither this Agreement nor any of its terms may be
changed or modified, waived, or terminated (unless as otherwise provided hereunder) except by
an instrument in writing signed by an authorized representative of the party against whom the
enforcement of the change, waiver, or termination is sought.
Section 18.11 Waiver; Remedies. No failure or delay by a party hereto to insist on the
strict performance of any term of this Agreement, or to exercise any right or remedy consequent
21
to a breach thereof, shall constitute a waiver of any breach or any subsequent breach of such
term. No waiver of any breach hereunder shall affect or alter the remaining terms of this
Agreement, but each and every term of this Agreement shall continue in full force and effect
with respect to any other then existing or subsequent breach thereof. The remedies provided in
this Agreement are cumulative and not exclusive of the remedies provided by law or in equity.
Section 18.12 Relationship of Parties. Manager and Owner acknowledge and agree that
they are not joint venturers, partners, or joint owners with respect to the Facility, and nothing
contained in this Agreement shall be construed as creating a partnership, joint venture or similar
relationship between Owner and Manager. In operating the Facility, entering into contracts,
accepting reservations for use of the Facility, and conducting financial transactions for the
Facility, Manager acts on behalf of and as agent for Owner (but subject to the limitations on
Manager's authority as set out in this Agreement), with the fiduciary duties required by law of a
party acting in such capacity.
Section 18.13 No Third Party Beneficiaries. Other than the indemnitees listed in Sections
15.1 and 15.2 hereof (who are third party beneficiaries solely with respect to the indemnification
provisions in such sections), there are no intended third party beneficiaries under this Agreement,
and no third party shall have any rights or make any claims hereunder, it being intended that
solely the parties hereto (and the aforementioned indemnitees with respect to the indemnification
provisions hereof) shall have rights and may make claims hereunder. Nothing in this Agreement
is intended, nor should it be construed, to create any rights, claims, or benefits or assume any
liability for or on behalf of any third party, or to waive any immunities or limitations conferred
under federal or state law, including but not limited to the Colorado Governmental Immunity
Act, § 24 -10 -101 et seq., C.R.S.
Section 18.14 Attorneys Fees. If any suit or action is instituted by either party
hereunder, including all appeals, the prevailing party in such suit or action shall be entitled to
recover reasonable attorney fees and expenses from the non - prevailing party, in addition to any
other amounts to which it may be entitled.
Section 18.15 Limitation on Damages. In no event shall either party be liable or
responsible for any consequential, indirect, incidental, punitive, or special damages (including,
without limitation, lost profits) whether based upon breach of contract or warranty, negligence,
strict tort liability or otherwise, and each party's liability for damages or losses hereunder shall
be strictly limited to direct damages that are actually incurred by the other party, provided that
the foregoing shall not limit or restrict any claim by Manager for the management fees described
herein upon a breach or default of this Agreement by Owner.
Section 18.16 Counterparts; Facsimile and Electronic Signatures. This Agreement may
be executed in counterparts, each of which shall constitute an original, and all of which together
shall constitute one and the same document. This Agreement may be executed by the parties and
transmitted by facsimile or electronic transmission, and if so executed and transmitted, shall be
effective as if the parties had delivered an executed original of this Agreement.
22
IN WITNESS WHEREOF, each party hereto has caused this Pre - Opening Services and
Management Agreement to be executed on behalf of such party by an authorized representative
as of the date first set forth above.
CITY OF PUEBLO GLOBAL SPECTRUM, L.P.
By: Global Spectru Inc., its general
partner
I
B //, I�/ By: 1 ►
lame: "y . 'man Name: Phil i r obe
Its: President of City Co,mri 1 Its: President & S cretary
ATTEST:
By:
Ci Jerk
23
EXHIBIT A -1
PRE - OPENING DUTIES
During the Pre - Opening Period, Manager shall perform the following duties:
I. Pre - Opening Consulting.
(a) Assist the Owner with its review of the design of the Facility, and make
recommendations to the Owner with respect to such design.
(b) Advise the Owner on any construction and operational issues with respect to the
Facility that may arise during the Term.
(c) Advise the Owner on risk management and insurance needs in connection with
the operation of the Facility, as more fully described in Article 16 of the Agreement.
(d) Assist the Owner in developing and implementing a telecommunications plan for
the Facility.
(e) Submit to the Owner recommendations regarding the selection of a food /beverage
service provider(s) at the Facility.
(0 Develop and recommend a proposed inventory of furniture, fixtures and
equipment to be used at the Facility.
(g) Prepare and submit to the Owner a list of operating supplies necessary for the
start-up of the Facility.
(h) Develop and submit to the Owner pre- opening and operational sales, marketing,
public relations, advertising, promotion, and event booking strategies and plans aimed at
maximizing revenues from the Facility.
THE OWNER ACKNOWLEDGES THAT NEITHER MANAGER NOR ITS EMPLOYEES,
AGENTS, PARTNERS OR AFFILIATES, ARE ARCHITECTS, GENERAL CONTRACTORS,
ENGINEERS OR FINANCIAL ADVISORS, AND THEIR CONSULTING SERVICES
PROVIDED UNDER THIS AGREEMENT ARE BASED ON THEIR OPERATIONAL
KNOWLEDGE OF ARENAS AND SHOULD NOT BE CONSTRUED AS A
REPRESENTATION OF ARCHITECTURAL, CONSTRUCTION, ENGINEERING OR
FINANCIAL PRACTICES. NEITHER THE OWNER NOR ANY OF ITS RESPECTIVE
AGENTS, CONSULTANTS, CONTRACTORS OR REPRESENTATIVES, WILL RELY
UPON MANAGER OR ITS PARTNERS AS HAVING ARCHITECTURAL,
CONSTRUCTION, ENGINEERING OR FINANCIAL EXPERTISE, OTHER THAN
OPERATIONAL KNOWLEDGE OF AN ARENA'S DESIGN.
24
II. Pre - Opening Management
(a) Develop an Operations Manual for the Facility. Manager shall deliver a
"template" of the Operations Manual to the Owner within thirty (30) days of the Effective Date,
and shall customize such template to apply to the Facility no less than ninety (90) days prior to
the Opening Date. The final version of the Operations Manual shall be mutually agreed upon by
the parties.
(b) Establish prices, rates and rate schedules for user, license, concessions,
occupancy, and advertising agreements, and booking commitments, at the Facility. Manager
may deviate from the established rate schedule when entering into any such agreements if
determined by Manager, using its reasonable business judgment, to be necessary or appropriate
with respect to the specific situation.
(c) Procure, negotiate, execute, administer and assure compliance with Service
Contracts. All such agreements shall provide for termination in the event the Facility is not
constructed or completed for any reason and shall not extend beyond the Term of this Agreement
unless approved by the Owner.
(d) Procure, negotiate, execute, administer and assure compliance with Revenue
Generating Contracts. All such agreements shall provide for termination in the event the Facility
is not constructed or completed for any reason.
(e) Arrange for and otherwise book events at the Facility in accordance with a
booking schedule to be developed by Manager.
(f) Plan, promote and execute, in conjunction with the Owner, a "grand opening"
event or events at the Facility.
(g) Engage, supervise and direct all personnel at the Facility that Manager deems
necessary to perform the pre - opening services described herein, and conduct staff planning,
retention and training programs with respect to such personnel as determined to be necessary by
Manager in its sole discretion.
(h) Maintain detailed, accurate and complete financial and other records of all its
activities under this Agreement in accordance with generally accepted accounting principles,
which records shall be made available to the Owner upon request, in accordance with Section
11.1 of the Agreement.
(i) Submit to the Owner in a timely manner financial and other reports detailing
Manager's activities in connection with the Facility, as set forth in Section 11.2 below.
(j) Cause such other acts and things to be done with respect to the Facility, as
determined by Manager in its reasonable discretion to be necessary for the management and
operation of the Facility prior to the Opening Date.
25
(k) Require event promoters /licensees to obtain licensing for copyrighted material
and non - musical works before any such works are performed or published by such parties.
26
EXHIBIT A -2
POST - OPENING DUTIES
Manager's obligations following the Opening Date shall consist of the following obligations, all
of which are subject to the terms hereof and the controls and restrictions in the Operations
Manual:
(a) Manage all aspects of the Facility in accordance with the Operations Manual and
the terms of this Agreement, including but not limited to managing purchasing, payroll, fire
prevention, security, crowd control, routine repairs, preventative maintenance, janitorial services,
promotions, advertising, energy conservation, security, box office, admission procedures,
parking (if applicable), and general user services.
(b) Establish and adjust prices, rates and rate schedules for user, license, concessions,
occupancy, and advertising agreements, and booking commitments. Manager may deviate from
the established rate schedule when entering into any such agreements if determined by Manager,
using its reasonable business judgment, to be necessary or appropriate with respect to the
specific situation.
(c) Procure, negotiate, execute, administer and assure compliance with Service
Contracts.
(d) Procure, negotiate, execute, administer and assure compliance with Revenue
Generating Contracts.
(e) Require that all material vendors and licensees of the Facility execute
vendor /license agreements containing standard indemnification and insurance obligations on the
part of each such vendor /licensee.
(f) Provide standard form advertising and sponsorship contracts and user /rental
agreements for use at or with respect to the Facility. Manager shall submit such form
agreements to the Owner for review and comment, and the parties shall work together to finalize
such forms. Once finalized, Manager shall use such forms in furtherance of its duties hereunder,
and shall not materially deviate from the terms contained in such forms without obtaining the
prior approval of the Owner (which shall not be unreasonably withheld). Manager's sole
responsibility with regard to providing legal advice or assistance hereunder shall be to provide
such standard form contracts.
(g) Operate and maintain the Facility, including the equipment utilized in connection
with its operation and any improvements made during the term of this Agreement, in the
condition received, normal wear and tear excepted.
(h) Arrange for and otherwise book events at the Facility in accordance with a
booking schedule to be developed by Manager.
27
(i) Hire or otherwise engage, pay, supervise, and direct all personnel Manager deems
necessary for the operation of the Facility in accordance with Article 6 of the Agreement, and
conduct staff planning, retention and training programs as determined to be necessary by
Manager in its sole discretion.
(j) Maintain detailed, accurate and complete financial and other records of all its
activities under this Agreement in accordance with generally accepted accounting principles,
which records shall be made available to the Owner upon request, in accordance with Section
11.1 of the Agreement.
(k) Submit to the Owner in a timely manner financial and other reports detailing
Manager's activities in connection with the Facility, as set forth in Section 11.2 of the
Agreement.
(1) Prepare a proposed annual Operating Budget and submit such proposed budget to
the Owner, both in accordance with Article 8 of the Agreement.
(m) Pay all Operating Expenses and other expenses incurred in connection with the
operation, maintenance, supervision and management of the Facility from the Operating Account
or with funds otherwise made available by the Owner.
(n) Secure, or assist the Owner (or any other third party, as applicable) to secure, all
licenses and permits necessary for the operation and use of the Facility for the specific events to
be held therein, and for the general occupancy of the Facility, including without limitation all
necessary food and liquor licenses, and renewals thereof. The Owner shall cooperate in this
process to the extent reasonably required. All costs associated with this process shall be
Operating Expenses.
(o) Collect, deposit and hold in escrow in the Event Account any ticket sale revenues
which it receives in the contemplation of or arising from an event pending the completion of the
event, as more fully described in Section 9.1 of the Agreement.
(p) Collect in a timely manner and deposit in the Operating Account all Revenue, as
more fully described in Section 9.2 of the Agreement.
(q) Pay and /or remit all Taxes in a timely manner.
(r) Plan, prepare, implement, coordinate and supervise all public relations and other
promotional programs for the Facility.
(s) Prepare, maintain and implement on a regular basis, subject to the Owner's
approval, a Marketing Plan for the Facility.
(t) Manage and oversee the sale of Commercial Rights at or in connection with the
Facility.
28
(u) On an annual basis, cause a written inventory to be taken of all furniture, fixtures,
office equipment, supplies, tools and vehicles at the Facility, and deliver a written report of the
foregoing to Owner. Manager shall document all major damage to, or loss in, such inventory
during the Term as soon as such damage or loss is discovered by Manager, and Manager shall
promptly notify Owner of any such damage or loss.
(v) Purchase, on behalf of the Owner and with Owner funds, and maintain during the
Term, all materials, tools, machinery, equipment and supplies necessary for the operation of the
Facility (not including the start-up FF &E, which shall be procured by Owner or a third party).
(w) As agent for the Owner, manage risk management and Facility insurance needs,
as more fully described in Article 16 of the Agreement.
(x) Make and be responsible for all routine and minor repairs, maintenance,
preventative maintenance, and equipment servicing. Manager shall be responsible for ensuring
that all repairs, replacements, and maintenance shall be of a quality and class at least equal to
that of the item being repaired, replaced or maintained. Any replacement of an item in
inventory, or any new item added to the inventory, which is paid for by the Owner, shall be
deemed the property of the Owner.
(y) Cause such other acts and things to be done with respect to the Facility, as
determined by Manager in its reasonable discretion to be necessary for the management and
operation of the Facility following the Opening Date.
(z) Require event promoters /licensees to obtain licensing for copyrighted material
and non - musical works before any such works are performed or published by such parties.
29
EXHIBIT B
EXISTING CONTRACTS
None.
30
EXHIBIT C
INSURANCE
At all times during this Agreement, Manager shall:
(a) maintain commercial general liability insurance, including products and
completed operations, bodily injury and property damage liability, contractual liability,
independent contractors' liability and personal and advertising injury liability against claims
occurring on, in, or about the Facility, or otherwise arising under this Agreement;
(b) maintain umbrella or excess liability insurance;
(c) maintain commercial automobile liability insurance, including coverage for the
operation of owned, leased, hired and non -owned vehicles;
(d) maintain appropriate workers compensation and employer's liability insurance as
shall be required by and be in conformance with the laws of the State of Colorado; and
(e) maintain professional liability insurance and self - insured employment practices
liability coverage;
Such liability insurance shall be maintained in the following minimum amounts throughout the
Term:
Commercial General Liability
$1,000,000 per occurrence
$1,000,000 personal and advertising injury
$1,000,000 products- completed operations aggregate
Automobile Liability
$1,000,000 per accident (PI and PD combined single limit)
$1,000,000 uninsured /underinsured motorist
Umbrella or Excess Liability
$5,000,000 per occurrence and aggregate
Workers Compensation
Workers Compensation: Statutory
Employer's Liability: $100,000 each accident - bodily injury by accident
$500,000 policy limit - bodily injury by disease
$100,000 each employee- bodily injury by disease
Professional Liability /Errors & Omissions (Claims Made)
31
$1,000,000 each occurrence /aggregate
Policy is to include:
Entity Coverage
Crime Insurance
Coverage on all on -site Manager employees. Limit: $500,000.00
32
EXHIBIT D
2012 PRE - OPENING EXPENSE BUDGET
33
00001216.002
ITEM TOTAL
PERSONNEL
Salaries $0.00
Benefits /EIP $0.00
TOTAL SALARY EXPENSE $0.00
>77747 7'74 747,75rZZrniMMZ.FIM MalLzitat,
OPERATING
„x � as,e - <. , . ,"3.L` Fk7ra-gimmi
Contracted Services HVAC, Web -Site etc. $4,000.00
Website Develo • ment Allowance $4,000.00
Dues $0.00
Pollstar $0.00
!AVM $0.00
Trade Shows & Meetin e s $0.00
Misc Trade Shows Allowance $0.00
$0.00
Institutional Advertisin . & Public Relations $8,500.00
Advertising Allowance $0.00
Public Relations Allowance $1,000.00
Gra • is Des n / Brochure Develo • ment Allowance $3,500.00
Promotional Items $4,000.00
Insurance Allowance $500.00
EZERVIZEMTEEKEIL=7:=73:7171:12:13=72'7Illial E17:717:7=
License & Permits Allowance $0.00
Posta• e, Frei! ht, Fed Ex Allowance $0.00
Printin. Allowance $0.00
Professional Fees *7,000.00
Audit $0.00
L -.51 $0.00
Mane • ement - Fixed $7,000.00
Incentive $0.00
.7isw.,7 iv11,we , .., �.aw..La.�w 6v".`,.Fax�a�.ti �- ,.,�.wi,L 7 7 $ w .o1x•.;k, iETI: 37
Relocation $0.00
0113a17:27757 7 .';77.7:172.1FRERTIEZEL=EETEE7711.7777.EMM
Subscri•tions Allowance $0.00
1aa:. fia rc,Y,3la. 1: , ''rz MST .... ETEW
Tele • hone / Data Allowance $400.00
Phones $400 00
Travel & Entertainment Allowance *0.00
[172711z2:171:77, d M x K 3Te 5
Utilities Allowance $4,600.00
Rental S. = ce $0.00
Power $0.00
Water & Sewer $0.00
g
TOTAL OPERATING EXPENSE *26,000.00
; s y w<r Tz . , ;fix ,; „ , EITZTEFM
TOTAL $26,000.00
5 giro f -, o Z57," _ = EA c s �i .
00001216.002
ITEM ® ® ® ® ®�®' '® TOTAL
slt r a 2=2 n z r.....s.< a' -:. .a tea" xiw.i ;. g . 7,.s. ,:x. u€a.:>S F:7 i .'°€R, ar •^. zt am2' : Nun ; >
--
50.00 60.00 60.00 60.00 60.00 10.00 $0.00 60.00 80.00 $0.00
50.00 60.00 *0.00 60.00 10.00 60.00 60.00 $0.00 60.00 $0.00
--- - - - - --
.. tsgU. .; 10-aT .'."`.: �1, 01as» - .!: '...s: . 1:e 5 i��`iSfri::h..au=fa ::Y $0.00 .00 60.00 80.00 i0 . 0.00
.
TOTAL SALARY EXPENSE � 4 �� to.0o �� *0 50 60.00 r
Contracted Services HVAC Web etc. 50.00 $0.00 $4 000.00 60.00 60.00 $0.00 60.00 $0.00 MIIIIIM $4 000.00
Wobslte Develo . era Allowance 64 000.00 - - - - -- $4,000.00
Soeware/nehwrk au n Allowance MINIIIIIIIIIMIIIMMINIMINIMMENOMMIIIIIIIIIIMMIIMINMIEMI 20.00
_ • Allowance -- - - - - -- 60.00
F r. » :. .12= r ., .-. :CEE!L, t� :�+"' °.a . � 2MflY'.:e s , 'sax V. g am = .,= ,, c , •M:.."`" .""
:: ■ 60.00 60.00 $0.00 60.00 80.00 80.00 60.00 60.00 60.00 $0.00
MIMMNIMNII■■■MnMMIMMI■M■■•=N■ 20.00
-- MMINIIMMMMII.M.IIIMIMI�� 20.00
, R J2,4'MI21 �a">/ZU"D .. ' . ...fEl-� ' ...a;'s z' ..f2:Ft 's � gf.FI T Tta t TF-', .;, '`>' mx.,. ..�.« " " ,3.�, `„r "3 ..>.
60.00 -- - - - - -- 50.00 $0.00 *0.00 *0.00 80.00 60.00 $0.00 $0.00 50.00
60.00
.. -- - - - - -- 60.00
5MO. r.t .M 3T , >w 17127A. '"�'.• Z717r . imYa r,Z T:I 3 : £?:a.. xa.a ZZ.M.��rs E ' 1 .. g ° xII' " M " jfCi.: �>Fas,r 'r , ..'jmw L vis 77M
Institutional Advertisin. & Public Relations 60.00 *0.00 *500.00 *500.00 S1 000.00 21 500.00 Si 500.00 52000.00 Si 500.00 $6,600.00
Adv. - , Allowance 1=IMMI=11=IMMINMIMMIMIIIMIMMIMIMIMMIMMIMINIMIMOMIIIIIIIMIMMNO 60.00
IMMIONIMMENIMMINIIIIIIII 6500.00 IIII *500.00 $1000.00
- -- 6500.00 *500.00 51 000.00 21000.00 61000.00 *4,000.00
Ora lo • • n / Brochure Deve •.•. -nt Allowance 1111111.1111MEMENIN 5500.00 $500.00 6500.00 5500.00 $500.00 $500.00 6500.00 $3 500.00
EMITIT:S22=7:7=7:2772.1EFEL=771727TZZ:=777;727-1r-;,:7,1771=7.7=1:72====.M.217==marialiarsM =MA
Insurance Allowance $500.00 - -- - -- $500.00
ER e- M2IVI..a.. ' :2u. M,. 7.011 ..>, ,.i.,7.7:=x .... sa -r ,.SL:a - 7 +'e>_ w . >iu::a, s> "- et,;af : s: , sz.>. t zzoa +�'ac
License & Permits Allowance -- - - - - - $
Post =•.e Frei!ht Fed Ex Allowance 11111111.1111111.11.M.1.11.11111.1111111.11.11.11=1.1.1.11.10 $0.00
�' �`a=17 ,.. i77,3 �.,na�r '�>.>s..."°saa� .��� �« u.,3f,aS� - E 3..v��,.Z1...x£k �;:� :�..�:�. -� '- St«g4�a•.��q..�..s '���.., A.� � � -�z0�7
- 1■11111111■=11111•■■=1111111111111111111MI∎ 0.00
su•:. 111a= ==71717==.71=v.=.,1 "`12.= <_z=w.'wai:: =7Z 1.721�^�.�:.e"
60.00 $0.00 81 000.00 81 000.00 $1 000.00 $1 000.00 61000.00 $1000.00 $1 000.00 67,000.00
i 80.00 80.00 80.00 60.00 - - - -NNMNMM 20.00
`i_ *0.00 $0.00 $0.00 20.00IIMM■••■=1■•■•=1.11111111111 80.00
I .12=1=1 80.00 80.00 21000.00 61 000.00 $1000.00 21000.00 21000.00 *1000.00 51000.00 $7000.00
*0.00 80.00 80.00 $0.00 1111111111111111111011MEMENIMMENIIIIIIMI MIMI=
Relocation Allowance 50.00 - - -�--- 80.00
a :aR2177^> " *."'3' = e ! �, , @ SM .:: 'ts"�'1 i.^ `mss. '7 ,u7. �;:::n t ^^" . =w r ^� :37. "'m'°' 1 , g '� < ,. h i . ,_ 4f
�. >.v.,iu,�..c a .a.<'nu.,....x§.....•.�.. a �.,._> . , w..:.wi_t>..w �i'....«,:� ._ ..u',�` x�� a�.,. >.k.,3�>......z.�,.31an +;'act..... ..w.�.. «�.u.. �......5...., c,».�.> .a. a n xi..a..M..c.x ,�_uw;�,ir'.. .a� dv =
e
Subsai • tions Allowance - -- 50.00 80.00 - -- 50.00
Tel : • one / Data Allowance 80.00 *50.00 150.00 _M 850.00 250.00 *Woo 250.00 850.00 $400.00
*50.00 $50.00 $50.00 $50.00 $50.00 850.00 $50.00 550.00 $400.00
�s h,si :'.: IIITM :.1 , T €�EILaa "a.` �:.H.x�.- a :�`, ;� - 9w',a+'rn.>.7 .::: .� ^. tra. :7 xi SLr-:. *7.as�..2:14 a�.? s -7r g iTli;� M
$0.00 $0.00 10.00 $0.00 *0.00 $0.00 $0.00 $0.00 20.00 $0.00
BItIMITEMI 20.00 w.00 5200.00 6500.00 it 000.00 *1 000.00 6200.00 6200.00 5e00.00 $4,600.00
-- - - - - - - $0.00
-- - - ---- $0.00
8000 - $500.00 $500.00 *1 000.00 81 000.00 *500.00 5500.00 5600.00 $4 800.00
111�1����� $0.00
n-'�'.L�".zt�.�.,�°.`,r�' ".�i.Y�ts^�Ti n,.ai' � °1�� ,1 "�i"'STS� a �'�'"'.�. § :?�" .""" ,. l""a."`�:'1• r - ?- �.. �a.-� V31-.7M
TA
-. , �:�� ..:.. a,`•.. a. >u.,��'��.:z;�:G:.a.u.��a.�a. .: ^_ >.. a:�3s.,ac�...A:`7 + �..a,�:w„ ..aa.,t..,:..�da,t : •"r�z';�""�.a.mati�" �wws�....x'..;�•+
TOTAL OPERATING EXPENSE $0.00 860.00 55,660.00 82,060.00 83,050.00 03,850.00 $3,060.00 83,560.00 *3,160.00 826,000.00
g,�srnZ . a g' " = ,;ct , :=7:1 3 T ", hw e n_ S ' :l °'°" ^^ ? ":C+'+- ^�.i..: .%n'� ?^m.' 'r's^ y Wi n ^'.
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FIRST AMENDMENT TO PRE - OPENING SERVICES
AND MANAGEMENT AGREEMENT
WHEREAS, the Pre - Opening Services and Management Agreement
( "Agreement ") was entered into by and between the City of Pueblo, a Municipal
corporation and Global Spectrum, L.P., a Delaware limited partnership, on May 14, 2012;
WHEREAS, the Agreement provides April 1, 2012 as the "Effective Date" of the
Agreement;
WHEREAS, Global Spectrum, L.P. provided no services to the City of Pueblo
pursuant to the Agreement prior to June 1, 2012; and
WHEREAS, the parties desire to amend the Agreement to reflect the actual date
services commenced under the Agreement.
NOW THEREFORE, the Effective Date of the Agreement is hereby amended to
June 1, 2012.
CITY OF PUEBLO GLOB • ' � iTRUM, L.P.
�� By: 1 •
By: /' e _ y•
O ' enny . i kelman P fillip + . ", einberg
Acting City Manager r esid a d Secretary
Dated: 6 /2 // Dated: t't i1
l
SECOND AMENDMENT TO PRE-OPENING SERVICES AND MANAGEMENT
AGREEMENT
This Second Amendment ("Amendment")to Pre-Opening Services and Management
Agreement, dated March , 2018, is between the City of Pueblo ("City") and Global
Spectrum, L.P. (now doing business as Spectra Venue Management) ("Spectra").
WHEREAS, the City and Spectra are parties to a Pre-Opening Services and
Management Agreement dated May 14,2012,as amended by a First Amendment entered into in
June, 2012 (as amended, the "Management Agreement");
WHEREAS, the City and Spectra now desire to amend the Management
Agreement as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and premises
contained herein and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties, intending to be legally bound, do hereby agree as
follows:
1. Section 4,1(a)of the Management Agreement shall be amended and restated as
follows:
"(a) The term of this Agreement (the "Term") shall begin on the Effective
Date, and, unless sooner terminated pursuant to the provisions of Section 4.2
below, shall expire on December 31, 2019, provided that Owner shall have the
right to terminate this Agreement without cause effective on December 31, 2018,
by providing written notice to the Manager at least sixty (60) days prior to such
date."
2. All references to the Management Agreement in the Management Agreement or
in any other document referencing the Management Agreement shall be deemed to refer to the
Management Agreement as amended hereby. Except for the modifications set forth above, all of
the provisions of the Management Agreement shall remain unmodified and in full force and
effect.
3. This Amendment shall he governed by and construed in accordance with the laws
of the State of Colorado, without regard to conflicts of law.
[Signature Page Follow's]
cum 3539r7 I
. .
IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of
the date first set forth above.
GLOBAL SPECTRUM, L.P., CITY OF PUEBLO
dThia Spectra Venue Management ..."
,„----
li--x /, \ , -
, --- By:
Name/ Ni
/ 7, , z , , ' -, Name. '-';:,--7
i Its: ,2>,,.vs^. .1,A
\ ,k
im
COM 353,W 1
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