Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Florida Panthers Holdings, Inc Form S-1 85 475K
2: EX-3.1 Amended and Restated Articles of Incorporation 4 13K
3: EX-3.2 By-Laws of the Company 26 71K
4: EX-5.1 Form of Opinion of Akerman Senterfitt 2± 8K
5: EX-10.1 Broward Co. Civic Arena License Agreement 64 266K
11: EX-10.11 Arena Management Agreement 43 108K
6: EX-10.2 Broward Co. Civic Arena Operating Agreement 63 265K
7: EX-10.3 Amendment to Operating and License Agreement 2 13K
8: EX-10.4 Broward Co. Civic Arena Development Agreement 78 284K
9: EX-10.7 Miami Arena Contract 203 577K
10: EX-10.8 First Amendment to Miami Arena Contract 57 158K
12: EX-21.1 Subsidiaries of the Company 1 6K
13: EX-23.1 Consent of Arthur Andersen LLP 1 6K
14: EX-27.1 Financial Data Schedule 1 9K
EX-10.11 — Arena Management Agreement
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EXHIBIT 10.11
ARENA MANAGEMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into by and
between DECOMA VENTURE, a Texas joint venture (hereinafter referred to as
"Decoma") and FACILITY MANAGEMENT AND MARKETING, a Texas joint venture
(hereinafter referred to as "FM&M"), on this 10th day of October, 1986.
WHEREAS, Decoma is the sole general partner of Decoma, Ltd., a Texas
limited partnership (hereinafter referred to as "Decoma, Ltd."); and
WHEREAS, Decoma, Ltd. is the sole general partner of Decoma Miami
Associations, Ltd., a Florida limited partnership (hereinafter referred to as
"Operator"); and
WHEREAS, on October 10, 1986 Operator and the Miami Sports and
Exhibition Authority (hereinafter referred to as the "MSEA" and/or "Owner")
entered into that certain Miami Arena Contract (hereinafter referred to as the
"Arena Contract"), reference to which is here made for all purposes, whereby
Operator undertook to perform certain functions relating to the development,
construction and operator of an arena (the "Arena") to be constructed and
operated in Miami, Florida, to be used generally for performance and exhibition
purposes, all as described therein; and
WHEREAS, Operator action through Decoma, Ltd., in turn acting through
Decoma desires to engage FM&M as an independent contractor to perform certain
of Decoma's obligations as set forth in the Arena Contract and FM&M desires to
accept such engagement in accordance with the terms and conditions more
particularly set forth herein.
NOW, THEREFORE, for and in consideration of the sum of Ten and No/100
Dollars ($10.00) in hand paid, and other good and valuable consideration, the
receipt and sufficency of which is
hereby acknowledged, and the mutual benefits to be derived here from, Decoma
and FM&M hereby agree as follows:
WITNESSETH:
1.01 Definitions. All capitalized terms used herein, othen than those
that are defined herein, shall have the same meanings ascribed to such terms as
set forth in the Arena Contract.
A. "BIL" shall mean BIL Development, Inc., a Texas corporation.
B. "Concessionaire Agreement" shall mean that certain agreement dated
October 10, 1996, by and between Operator, and Harry M. Stevens, Inc.
C. "HSA" shall mean HSA Management, Inc., a Texas corporation.
D. "Joint Venture Agreement" shall mean that certain Joint Venture
Agreement of Decoma, executed effective as of September 4, 1984, by and among
HSA Management, Inc., BIL Development, Inc., and Linbeck Miami Corp.
E. "LMC" shall mean Linbeck Miami Corp., a Texas corporation.
F. "Person" shall mean an individual, partnership, corporation, trust,
unincorporated association, or other entity or association.
G. "Venturer" or "Venturers" shall mean BIL, HSA, LMC, and any Person
admitted to the Venture as an additional or substitute Venturer in accordance
with the Joint Venture Agreement; but excluding any Person that ceases to be a
Venturer pursuant to the Joint Venture Agreement.
H. "Venture Representative" shall mean any one of the BIL
Representative, the HSA Representative or the LMC Representative under the
Joint Venture Agreement.
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1.02 Services.
A. Subject to the terms and provisions of this Agreement, and for the
Term (as herein defined) of this Agreement, Decoma hereby grants to FM&M the
sole and exclusive right, engages FM&M to perform as an independent contractor,
and hereby delegates to FM&M on a sole and exclusive basis the right to
supervise, administer, and manage the performance of all of the Operating Work
to be peformed by Operator as set forth in Paragraph B.3 of Exhibit "B" to the
Arena Contract in a reasonable and efficient manner, and in accordance with
this Agreement and the operating standards and provisions set forth in
Paragraphs D.5.2 and D.5.3 of Exhibit "D" to the Arena Contract. Subject to
the provisions of this Agreement, FM&M hereby accepts such engagement and
shall, during the term of this Agreement, supervise, administer and manage the
performance of the Operating Work as herein provided, all of which shall be
performed by FM&M at the time and in the manner deemed appropriate by FM&M in
its sole and absolute discretion (but subject to the terms, provisions and
performance standards of this Agreement), without the need for any prior
approval (except as set forth herein and in the Arena Contract) by Decoma (or
any of the Venturers thereof), Decoma, Ltd. (or any of the partners thereof),
Operator (or any of the partners thereof) and/or the MSEA.
Subject to the applicable restrictions and applicable limitations of
this Agreement and the Arena Contract, to the extent necessary to manage and
operate the Arena in accordance with the Arena Contract, the Operating Work
shall include the following:
(1) Management and operation of the Arena and
contracting for its use during the Term in a manner that will promote
and further the purposes for which the Arena is to be contracted, as
set forth in Paragraph D.5.2.1 of Exhibit "D" to the Arena Contract.
(2) Retaining legal counsel for the Arena (as opposed to legal counsel
for the Venture) and analysis, consultation and coordination of all
insurance programs.
(3) Negotiation, execution and performance of contracts, use
agreements, licenses, and other agreements (a) with persons or entities who
desire to schedule events, performance, telecasts, broadcasts or other
transmissions in, from or to the Premises or who desire otherwise to use
the Premises or any part of thereof or (b) that otherwise pertain to the
use, operation and occupancy of the Premises or any part thereof. [Complete
copies of all "major use contracts" (as hereinafter defined) and related
documents shall be provided to Decoma promptly].
(4) Coordination of all advertising, licensing, promotional
activities, marketing, and public relations for the Arena.
(5) Negotiation, execution and performance of contracts, use
Agreements, licenses and other agreements (a) for the use of advertising
space for the Premises or any part thereof and all advertising rights of
whatever kind or nature related thereto or (b) for the sale, promition,
marketing and use of all names, trademarks, tradenames, logos and similar
intangible property relating to the Premises or any part thereof.
(6) Subject to the Concessionaire Agreement which has already been
executed, negotiation, execution and performance of contracts for the
operation of future concessions at and for the Premises for the sale of
food, beverages, souvenirs, novelties and programs and including, but not
limited to, the operation of clubs and restaurants. [Complete copies of
all concession
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agreements and related documents shall be provided to Decoma promptly].
(7) Coordination of the efforts of all parties involved in the
operation of the Arena and establishing and maintaining consistent
procedures for cost estimating, reporting and control, performance
schedule preparation and maintenance and payment of invoices. Such
services to be performed by FM&M shall include the following:
(a) On or before the first of each Operating Year FM&M
shall prepare and submit to Owner and to Decoma an operating
program budget for review and informational purposes only,
describing the estimated revenues (at least as to revenues from
the major use contracts herein referred to) and estimated
expenses expected to be received and incurred in implementing
a broadscale program covering the Arena for the coming
Operating Year.
(b) At least ninety (90) days before the commencement of
each Regular Budgeted Year and each Special Budgeted Year, FM&M
shall submit to Owner for Owner's review and approval an
Operating Expense Budget, as provided for in the Arena
Contract, setting forth an estimate of the Operating Expenses
that FM&M estimates will be incurred during such Operating
Year.
(c) At least one hundred (100) days before the
commencement of each Regular Budgeted Year and each Special
Budgeted Year, FM&M shall submit to Decoma and the Venture
Representatives for review and approval the Operating Expense
Budget FM&M intends to submit to Owner under Subparagraph (b)
above, setting forth an estimate of the Operating
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Expenses that FM&M estimates will be incurred during such
Operating Year. Decoma and the Venture Representatives shall
not unreasonably withhold their consent and/or approval of the
Operating Expense budget submitted by FM&M. In the event
Decoma or any Venture Representative objects to the proposed
Operating Expense Budget, Decoma or such Venture Representative
shall stipulate its objections in writing to FM&M. In the
event that neither Decoma nor any of such Venture
Representatives disapproves the proposed Operating Expense
Budget within ten (10) days after the submission by FM&M to
Decoma and the Venture Representatives of such Operating
Expense Budget, the Operating Expense Budget shall be deemed
approved by Decoma and all Venture Representatives.
Notwithstanding any other provision of this Agreement, FM&M may
nevertheless submit the proposed Operating Expense Budget to
Owner, and in the event the proposed Operating Expense Budget
is approved by Owner under the Arena Contract, the proposed
Operating Expense Budget shall be the Approved Operating
Expense Budget regardless of whether such budget was
disapproved by Decoma or any such Venture Representative. In
connection with the Approved Operating Expense Budget, FM&M
shall have the right, subject to other terms hereof and to the
terms of the Arena Contract, to exceed the Approved Operating
Expense Budget (i.e., spend more than the budgeted amount for
such items) to the extent necessary to operate the Arena in
accordance with the standards set forth herein and
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to fulfill the obligation and duties of FM&M hereunder;
provided, provided, however, in the event that FM&M has
incurred expenses which exceed 115% of those items set forth in
Paragraph C.2.2.1(c) of Exhibit "C" to the Arena Contract, then
FM&M shall identify such expenses in the monthly operating
report submitted to Decoma as set forth in Section 1.02.A(8) of
this Agreement. In the event that FM&M anticipates that the
Operating Expenses set forth in Paragraph C.2.2.1(c) of Exhibit
"C" to the Arena Contract may or will exceed 115% of the
budgeted amount for such expenses (after taking into account
any offset by savings, if any, that may have been realized
during such Operating Year in costs for utilities, insurance,
taxes, extraordinary legal costs, NBA staffing, and any other
category of savings allowed by the MSEA), then FM&M shall
promptly inform Decoma in writing of such fact (without waiting
for the next scheduled report) and in no event shall FM&M have
any right, power or authority [except in the event of the need
to provide "emergency services and expenditures" in connection
therewith (as hereinafter provided for)] to incur any expenses
in excess of 130% of the Approved Operating Expense Budget
unless and until Decoma shall decide (unless Owner has already
approved the expenditures to such excess amounts in accordance
with the Arena Contract such that the Operator shall not be
liable therefor) that additional expenses of that type should
be incurred in that Regular or Special Budgeted Year. Any
approval given by Decoma to FM&M to spend any such excess
amounts
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shall be deemed given if Owner, pursuant to a mid-year revision
to the Approved Operating Expense Budget approves such
expenditure and agrees that Operator shall not be liable
therefor, notwithstanding the provisions of Paragraph
C.2.2.1.(c) of Exhibit "C" to the Arena Contract to the
contrary. Any mid-year revisions to the Approved Operating
Expense Budget made by FM&M and submitted to Owner shall also
be submitted to Decoma for review and informational purposes
only, but such revisions shall not constitute authorization for
expenditures until approved by the Owner as provided above.
Recognizing that the operation of the Premises is unique to the
exhibition, entertainment and sports industry in general and
that any budgetary estimates are by their nature susceptible to
change, variation and amendment, FM&M shall have no liability
to Decoma for failure to meet or comply with the operating
program budget described in Subparagraph (a) above or with the
Approved Operating Expense Budget or any expense budget
approved or deemed approved by Decoma or Owner (except as
provided herein in connection with a default by FM&M hereunder
and then however, subject to the limitations for liability
applicable thereto, if any). For the purposes hereof, and to
be consistent with the terms of the Arena Contract, FM&M shall
have the right to perform all emergency repairs or services
immediately necessary for the preservation and safety of the
Arena, or to avoid the suspension or any substantial or
important service to the Arena, or to avoid or prevent
immediate danger to life or
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property, and whether or not the cost thereof is set forth in
the Approved Operating Expense Budget or other budget (provided
that for any situation that is not life threatening, such
amount is not reasonably anticipated by FM&M to exceed
$50,000). However, FM&M shall, if at all possible, secure the
prior approval of the performance of any such repair or service
and the expenditure of any such amount, by telephone or in
writing, as the circumstances reasonably allow, from the
Managing Venturer of Decoma, and in any event, FM&M shall give
such Managing Venturer a verbal notice of the performance of
such repairs or services and the expenditure of such amounts as
soon as practicable under the circumstances. Thereafter, as
soon as practicable, FM&M shall given Decoma written notice of
the details and expenses thereof.
(d) Plan, coordinate and administer operation of the
Premises.
(e) After the Construction Work and Development Work
have been completed, coordinate the work of all parties
performing work in connection with the operation of the Arena.
(f) Monitor actual and projected costs of operation and
monitor revenues of "major use contracts" (hereafter defined)
and advise Owner and Decoma as such projected costs exceed the
estimates set forth in the budgets submitted pursuant to the
Arena Contract and pursuant to this Agreement and as such
revenues materially differ, if at all, from any projections
made by FM&M.
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(g) Collect revenues due Operator from concessionaires,
licensees and other users and make payment of the Operating
Expenses in accordance with the provisions of Paragraph C.2.2.1
of Exhibit "C" to the Arena Contract.
(h) Furnish all services, materials, tools, machinery,
equipment and other items, and a sufficient number of capable,
qualified and competent administrative, management, supervisory
and clerical personnel necessary to accomplish the requirements
of FM&M under this Agreement, all, however, within the
budgetary limitations of this Agreement and the Arena Contract.
(8) Prepare monthly financial reports for Decoma and Owner
in the form necessary to meet the obligations of Operator under the
Arena Contract. FM&M will further keep and maintain at the offices of
FM&M in the Arena, separate records devoted exclusively to the Arena
reflecting the business operations of the Arena which records shall be
subject, at Decoma's sole cost, to inspection or audit by Decoma (or
any Venture Representative at such Venture Representative's sole cost)
at any reasonable time during regular business hours and after prior
written notice.
(9) Coordinate the Operating Work's compliance with all
federal, state, and local affirmative action and minority employment
and investment requirements and specifically exert diligent, good
faith efforts to comply with Section VI of the Minority Participation
Agreement, which is attached as Exhibit "A" to the Arena Contract.
(10) Plan, coordinate and administer the preventative
maintenance of the Premises and all machinery,
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equipment and facilities pertaining thereto or made a part
thereof in accordance with Paragraph D.5.2.2 of Exhibit "D" to
the Arena Contract.
(11) To the extent funds are made available by Decoma
to FM&M therefore, FM&M shall promptly remedy any violation of
any Legal Requirement which comes to its attention to the
extent such remedy is within the control of FM&M; interest,
penalties, fines, and other charges payable because of delays
in payment by FM&M, not authorized by or not occasioned by any
act or omission of Decoma shall be for FM&M's sole account.
(12) In case of any emergency or any situation where the
failure to promptly comply with any Legal Requirement which
would expose Decoma (or any of its Venturers), the Operator,
the Owner, the City of Miami, FM&M and/or Decoma, Ltd. to the
imminent danger of criminal liability, then in such event, FM&M
shall cause such violation of such Legal Requirement to be
complied with or cured without awaiting Decoma's consent and to
promptly notify Decoma of the same.
B. Decoma acknowledges that FM&M (and any
predecessor-in-interest of FM&M including, but not limited to, Houston
Sports Association, Inc., HSA Management, Inc. and/or Miami
Management, Inc.), prior to the date of this Agreement, has provided
or performed several of the services relating to the Operating Work,
which services were performed by FM&M (or such
predecessor-in-interest) for and on behalf of Decoma and all such
services so performed by FM&M (or such predecessor-in-interest) prior
to the date hereof, and which have been made known to Decoma, are
hereby ratified and approved by Decoma. All actions taken (or
heretofore taken) by FM&M (or such predecessor-in-interest) in
performing its duties and responsibilities under the Pre-Development
Agreement and in providing such services relating
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to the Operating Work, pursuant to the terms and provisions of this Agreement
shall be (or were) as Decoma's special agent and for the account of Decoma. To
the extent FM&M (or any of its predecessors-in-interest) have not been
reimbursed, Decoma agrees to be responsible for and to pay for all reasonable
costs, fees, expenses and disbursements incurred in the provision or performance
of the Operating Work hereunder in accordance with the Arena Contract, the
Approved Project Budget and all funds made available to the Operator thereunder.
C. Decoma acknowledges that the compensation payable to FM&M
hereunder is not intended to cover the costs or expenses of FM&M incurred in
performance of the Operating Work or any other services provided by FM&M
hereunder, all of which shall constitute Event Related Expenses, Extraordinary
Replacement and Repair Expenses, Operating Expenses, and/or Pre-Opening
Operating Expenses, to the extent the same are incurred in accordance with the
Operating Expense Budget and/or the Decoma Venture budget and this Agreement,
and shall be paid pursuant to and in accordance with the Arena Contract and not
by FM&M or, if paid by FM&M, shall be reimbursable to FM&M upon demand therefor
(subject to the provision of subsection 1.02.D below). Such costs and expenses
also include, but shall not be limited to, the following:
(1) Pursuant to the Venture budget, up to the sum of $15,000 per year
(increased as hereinafter set forth) during the term hereof from and after the
Opening Date for the reasonable cost and expenses of travel, lodging and meals
for Houston-based management personnel of FM&M while out of the City of
Houston in the performance of the services described in Section 1.02 hereof
(and any such expenses incurred by FM&M prior to the Opening Date shall be
reimbursed by Decoma to FM&M out of the Project Budget pursuant to the Arena
Contract); provided, however, with respect to said
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$15,000 sum, the Venture shall not unreasonably withhold its consent to a
request by FM&M that such budget amount be increased each year to take into
account increases in the costs and expenses of travel, lodging and meals, nor
shall the Venture unreasonably withhold its approval of reasonable costs and
expenses actually incurred for such travel, lodging and meals which are
reasonably anticipated to be incurred by FM&M (and provided FM&M has notified
the Managing Venturer in advance of such anticipated budget overruns, and the
amount thereof, and the Managing Venturer has approved such overruns [which
approval shall not be unreasonably withheld or delayed]) in connection with
performance of such services, even in excess of the budgeted amounts; and
(2) Pursuant to the Operating Expense Budget, the following:
(a) Business entertainment expenses relating to the Operating
Work; and
(b) All costs and expenses associated with the Operating Work;
and
(c) All staffing necessary to perform the Operating Work;
(d) All costs of operation of the Arena including, without
limitation, Pre-Opening Operating Expenses, Event Related Expenses,
Operating Expenses and Extraordinary Replacement and Repair Expenses;
(e) All salaries, wages, benefits, costs and expenses of FM&M's
Arena staff, and associated Miami office expenses (including, without
limitation, costs of telephones, postage, forms, papers, ledgers and
other supplies, equipment and expenses), costs of bookkeeping,
accounting and
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data processing, transportation and travel and lodging expenses of such
Miami-based FM&M personnel and employees incurred in the discharge of
FM&M's responsibilities hereunder; and
(f) All other costs or expenses, incurred in accordance with the
terms and provisions of this Agreement by or for the account of
Decoma reasonably related to the services provided hereunder in
connection with the operation and management by FM&M of the Arena.
FM&M's staff and personnel shall be the employees of FM&M, and all matters
pertaining to the employment, training, placement, supervision, compensation,
promotion and discharge of FM&M staff and personnel are and shall be sole
responsibility of FM&M and all contracts with the staff and personnel shall be
entered into the name of FM&M.
D. Notwithstanding any provision of this Agreement to the contrary,
FM&M shall not be obligated to make any advance to or for the account of Decoma
nor to pay any sums incurred for the performance of the Operating Work, nor
shall FM&M be obligated to incur any liability or obligation for the account of
Decoma without assurance that the necessary funds for the discharge thereof are
or shall be available, nor shall FM&M be responsible for the failure of the
Operating Work to meet the standard provided herein as a result of Decoma's
failure to provide funds as herein set forth. Further, notwithstanding any other
provision of this agreement, FM&M shall only be obligated to perform its duties,
responsibilities and obligation hereunder only to the extent that funds of
Decoma are made available to FM&M for such purpose. In the event any of the
costs, fees or expenses described in subsection 1.02.C. above are paid by FM&M
on behalf of Decoma, then FM&M shall be entitled to be reimbursed for such
payment on a monthly basis, upon presentation to Decoma of FM&M's statement of
such costs, fees and expenses so incurred
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and paid; provided, FM&M shall not be entitled to reimbursement for such costs,
fees and expenses (except as provided in the following sentence) until and when
(i) the Operator is reimbursed by the Owner under the Arena Contract and such
funds are received by the Venture or (ii) such items are provided for in the
Venture budget of Decoma. However, all costs, fees and expenses incurred by
FM&M in the performance of the emergency services described in Subsection
1.02A(12) of this Agreement shall be for Decoma's account, and to the extent
FM&M makes an advance for the account of Decoma or pays any of such costs, fees
and expenses on behalf of Decoma (and without regard to whether such costs, fees
and expenses are reimbursable under the Arena Contract), FM&M shall be entitled
to be reimbursed by Decoma upon demand for the actual amount so advanced or
paid by FM&M.
E. If Decoma fails to make any reimbursement payment described in
Paragraph C and in Paragraph D of this Section 1.02 within ten (10) days after
demand therefor, then the amount due shall be interest at Prime plus 2-1/2% per
annum from the date due until the date FM&M is so reimbursed.
F. Within the limitations of this Agreement and the Arena Contract,
FM&M agrees that, in the performance of all of its duties and responsibilities
hereunder, FM&M shall abide by this Agreement, the Arena Contract, and the
Decoma Venture budget and the Operating Expense Budget (subject to the terms
hereof), and shall continue to act in good faith, in a diligent, workmanlike,
skillful, and careful manner, and shall continue to exercise reasonable and
professional, prudent judgment in accordance with generally accepted standards
of management for complexes similar to the Project in the United States.
1.03 Additional Authority of FM&M. In connection with the discharge of
its obligations hereunder, FM&M shall have the sole and exclusive authority
(subject to the terms and provisions of this Agreement) to perform all of the
functions of Operator as more particularly set forth in Paragraphs D.7.4.
(Contracts for
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Use of the Arena), D.7.5 (Advertising Contracts), D.7.6 (Concessions) and D.7.7
(Use and Advertising Contracts) of Exhibit "D" to the Arena Contract without the
prior approval (except as herein provided) by Decoma (or any Venturer or Venture
Representative thereof), Decoma, Ltd. (or any partner thereof), Operator (or any
partner thereof) and/or the MSEA. However, notwithstanding any other provision
of this Agreement, FM&M shall obtain Decoma's prior written approval (which
approval shall not be unreasonably withheld or delayed and shall in all events
be deemed approved if no approval or disapproval is given by Decoma or by any
Venture Representative within ten (10) days of the date of a request therefor,
which request shall include a complete, legible and accurate copy of the
proposed "major use contract" and all related documents or if no such document
has been finalized then a draft of such contract or a term sheet summarizing in
reasonable and sufficient detail the business terms for such contract) for any
"major use contract", which for the purposes hereof shall mean any contract,
agreement or license (or material amendment to the terms of such contract,
agreement or license) with (i) each user (or affiliated group of users) which
provides for forty (40) scheduled events or more in the Arena during each
Operating Year under any such contract, agreement or license with a term of five
(5) years or more and (ii) any contract, agreement or license (or material
amendment to the terms of such contract, agreement or license) with a basketball
league, hockey league or soccer league user which provides for at least
thirty-five (35) scheduled events or more in the Arena during each Operating
Year with a term of five (5) years or more. Additionally, Decoma's prior
written approval (which approval shall not be unreasonably withheld or delayed)
shall also be required (and shall similarly be deemed approved if no approval
or disapproval is given by Decoma or by any Venture Representative within ten
(10) days of the date of a request
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therefor) for: (i) any and all contracts relating in any manner to the use or
operation of the Arena with any person or entity having any ownership, proceeds
or profits interest in FM&M; (ii) any contracts, agreements or licenses (or
material amendment to such contracts, agreements or licenses) which provide for
third-party financing for any of the operations of the Arena, other than for
unsecured trade accounts incurred in the ordinary course of the operation of the
Arena; and (iii) selection of a replacement for the concessionaire under the
Concessionaire Agreement and any material amendments to the terms of any such
agreement.
1.04 Additional Funds. In order to facilitate that performance by
FM&M of its obligations hereunder, Decoma agrees to make available, pursuant to
the budget and funding mechanisms described in and contemplated by the Arena
Contract and this Agreement, to FM&M monthly, upon the written request of FM&M,
such amounts are provided to be funded to Operator under the Approved Operating
Expense Budget and/or under the Decoma Venture budget and as FM&M may require
in connection with the operation of the Arena including, but not limited to, the
working reserve contemplated under the Arena Contract (as such reserve is made
available to Operator under the Arena Contract and such funds are received by
the Venture).
To the extent expressly permitted under the Arena Contract, in
connection with any sums owed or owing to the Operator thereunder, FM&M shall
have the right under this Agreement to deduct from such sums any monies owed to
FM&M under this Agreement which monies are held by FM&M for the benefit of or
intended for distribution to the Venturers or to Decoma, but expressly excluded
any monies held for the benefit of or intended for distribution to the limited
partner of Decoma, Ltd. or the limited partners of Operator.
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1.05 Acknowledgment. Decoma acknowledges for itself, Decoma, Ltd.
and Operator that FM&M has not made and does not make any representations as to
the income, expenses, profits and/or losses expected to be derived from or to be
derived from the operation or as to the operation of the Arena. Decoma
acknowledges for itself, Decoma, Ltd. and Operator and stipulates that it does
not in any way rely on any warranties or representations of FM&M (or any of its
predecessors-in-interest), its officers, joint venturers, employees, or agents
and that no warranties or representations concerning FM&M or the Arena, past or
future, or financial performance or potential financial performance have been
made to Decoma, Decoma, Ltd. and/or Operator. In connection with the foregoing,
neither FM&M nor any of its predecessors-in-interest and all of their officers,
joint venturers, employees or agents shall be liable or bound in any manner by
any verbal or written statements, representations, or information pertaining to:
(i) the profitability of operations at the Arena and (ii) any benefits which may
or may not accrue to Decoma or the Venturers (or Decoma, Ltd. or Operator)
resulting from such operations.
1.06 Term. The term of this Agreement shall be co-extensive with the
term of the Arena Contract as set forth in Article V of the Arena Contract
(unless this Agreement is sooner terminated as provided in Section 1.09 below),
as such Arena Contract may be from time to time extended, amended, or as such
Arena Contract may be sooner terminated in accordance with Paragraph D.1.2. of
Exhibit "D" to the Arena Contract.
1.07 Personnel.
A. All personnel employed at the Arena shall be employees of FM&M
and shall not be deemed employees of Decoma. The employees and agents of FM&M
shall attain no rights or benefits under the Civil Service or Pension Ordinances
of the City of Miami, Dade County or the State of Florida, nor shall
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FM&M or its employees be entitled to Florida worker's compensation benefits as
employees of the City of Miami, Dade County or the State of Florida. FM&M
shall make a reasonable effort to recruit minority and non-minority employees
who reside in Miami. FM&M shall be responsible, to the extent of funds made
available from Decoma, for the hiring and direct remuneration of all personnel
necessary for the operation of the Arena.
B. The obligations of FM&M shall not require the services of Neal
Gunn or Mike McGee personally or individually, but shall be deemed satisfied by
the performance of the other officers, employees, representatives and agents of
FM&M.
1.08 Compensation. In consideration of performance by FM&M of the
services hereunder, and provided the Operating Payment is paid to the Operator
in accordance with the Arena Contract and is received by the Venture, Decoma
shall pay to FM&M a fee (the "Management Fee") comprised of the following:
(A) Commencing with the Opening Date, for each month of the first four
(4) years of the Term hereof from and after the Opening Date, the sum of
$6,666.66 per month (prorated for any partial month); for each month of the
next twelve (12) years of the Term hereof, the sum of $8,333.33 per month
and for each month thereafter during the Term hereof, the sum of $16,666.66
for each such month. Such portion of the Management Fee ("Base Fee") shall
be paid to FM&M in monthly installments as above provided. One such
installment shall be payable on or before the 5th day of each calendar
month commencing with the first month of the Term in which the Opening Date
occurs, and a like installment shall be payable (adjusted and increased as
hereinabove set forth) on the same day of each month thereafter or the
entire Term hereof; and
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(B) In addition to the Base Fee and as part of the Management Fee
referred to in the preceding paragraph, Decoma also agrees to pay to FM&M the
"Incentive Bonus". For the purposes hereof, the term "Incentive Bonus" shall
mean a bonus calculated on an annual basis following the end of each calendar
year during the Term hereof (commencing with the calendar year in which the
Opening Date occurs), which bonus shall equal a percentage (as set forth below)
of such prior calendar year's Net Operating Income from the operations of the
Arena, to the extent that such Net Operating Income for each such year exceeds
(for the applicable year involved) those amounts set forth on Exhibit "A"
attached hereto, incorporated herein and made a part hereof for all purposes,
such percentage being as follows:
With respect to the first additional $100,000 of Net Operating
Income in excess of such amount for the applicable year involved
an amount equal to one percent 1%) of such additional amount or
portion thereof.
With respect to the next additional $100,000 of Net Operating
Income in excess of such amount for the applicable year involved
an amount equal to the two percent (2%) of such additional
amount or portion thereof and similarly an additional one percent
(1%) for each increment of $100,000 of additional Net Operating
Income or portion thereof thereafter until the applicable
percentage for the next $100,000 increment of Incentive Bonus
has reached a percentage equal to twenty-five percent (25%)
of such $100,000 increment (which shall be achieved at a level
of $2,400,000 of additional Net Operating Income) of additional
Net Operating Income and such twenty-five percent (25%) figure
shall apply to all additional Net Operating Income in excess of
$2,400,0000 for the applicable year involved for any year during
the Term hereof; provided, however, that the Incentive Bonus for
any Operating Year shall not exceed the "Incentive Bonus Limit"
for such year set forth on Exhibit "A" attached hereto.
By way of illustration of the foregoing, but without limitation
thereof, in taking the
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year 1995, as shown on Exhibit "A" attached hereof as an example
to show the method of calculation of the Incentive Bonus, if in
such year the actual Net Operating Income of the Arena is
$132,000 (thereby creating excess Net Operating Income of $100,000
above the amount set forth on Exhibit "A" for that year), then,
in such event, the Incentive Bonus payable to FM&M for such year
would be one percent (1%) of such excess amount or the sum of
$1,000; similarly, had such excess amount of Net Operating Income
been $400,000, then the Incentive Bonus payable to FM&M for such
year would be one percent (1%) of the first $100,000 of such
excess amount, two percent (2%) of the next $100,000, three percent
(3%) of the next $100,000 of such excess amount and four percent
(4%) of the next $100,000 of such excess amount or the aggregate
sum of $10,000; similarly, had Net Operating Income for 1995
been $2,942,000 (thereby creating excess Net Operating Income of
$2,910,000 above the amount set forth on Exhibit "A" for that year),
the incentive Bonus payable to FM&M for such year would be one
percent (1%) of the first $100,000 of such excess amount, two
percent (2%) of the next $100,000 of such excess amount, three
percent (3%) of the next $100,000 of such excess amount and an
increasing percentage of the excess Net Operating Income, as
calculated above, which would result in an Incentive Bonus payable to
FM&M of $427,500; similarly, had Net Operating Income for 1995 been
$3,942,000 (thereby creating excess Net Operating Income of $3,910,000
above the amount set forth on Exhibit "A" for that year), the Incentive
Bonus payable to FM&M for such year would be $457,308 due to the
application of the Incentive Bonus Limit.
Said Incentive Bonus shall be calculated by FM&M (with such calculation
to be furnished to Decoma) based upon the figures of Net Operating Income
(as defined in the Arena Contract) available to FM&M for the applicable year
involved (and irrespective of whether or not the Incentive Bonus was paid in
prior years), and shall be due and payable to FM&M by Decoma within thirty
(30) days following the end of the applicable year involved.
1.09 Defaults and Remedies.
A. Each of the following shall constitute a "FM&M Default"
hereunder:
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(1) The failure of the FM&M to pay any amounts required to be paid by
FM&M under this Agreement within ten (10) days after written notice from
Decoma that such amounts are delinquent;
(2) The failure of FM&M to substantially perform or observe any of the
other material obligations, covenants, agreements, or conditions to be
performed or observed by FM&M under this Agreement within sixty (60) days
(subject to the provisions of Section 1.11 of this Agreement relating to
force majeure) after written notice from Decoma of such failure; provided,
that if such performance or observance cannot reasonably be accomplished
within such sixty (60) day period, then the failure to commence such
performance or observance within such sixty (60) day period and (subject to
Section 1.11 of this Agreement relating to force majeure) to diligently
pursue such performance or observance to conclusion;
(3) The filing by FM&M of a voluntary petition in bankruptcy; the
adjudication of FM&M as a bankrupt; the approval as properly filed by a
court of competent jurisdiction of any petition or other pleading in any
action seeking reorganization, rearrangement, adjustment, or composition of,
or in respect of, FM&M under the the Bankruptcy Code, or any other similar
state or federal law dealing with creditor's rights, generally; or the
appointment of a receiver, trustee or other similar official for FM&M or its
property, unless within ninety (90) days after such approval, filing or
appointment, FM&M causes such appointment to be stayed or discharged;
provided, however, notwithstanding any of the foregoing to the extent there is
an obligation of the Operator under the Arena
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Contract which is also an obligation of FM&M hereunder and for which the
standard of care or performance under the Arena Contract is substantially the
same standard of care or performance for FM&M hereunder, FM&M shall never be
deemed to be in default of its obligations hereunder unless Operator is itself
declared in default of such obligations by Owner under the Arena Contract.
B. Each of the following constitute a "Decoma Default" hereunder:
(1) The failure of Decoma to pay any amounts required to be paid by
Decoma to FM&M under this Agreement within ten (10) days after written
notice from FM&M that such amounts are delinquent.
(2) The failure by Decoma to substantially perform or observe any
of the other material obligations, covenants, agreements, or conditions to
be performed or observed by Decoma under this Agreement within sixty (60)
days (subject to Section 1.11 of this Agreement relating to force majeure)
after notice from FM&M of such failure; provided, that if such performance
or observance cannot reasonably be accomplished within such sixty (60)
day period and (subject to Section 1.11 of this Agreement relating to force
majeure) to diligently pursue such performance or observance to conclusion.
(3) Any default by Operator under the Arena Contract unless such
Operator default is caused by a default of FM&M hereunder.
Subject to the terms and provisions hereof, upon the occurrence of a
FM&M Default of the type described in Section 1.09.A(1) or a Decoma Default of
the type described in Section 1.09.B(1), the non-defaulting party shall have the
right
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to give the defaulting party notice ("Final Notice") of its intention to
terminate this Agreement after the expiration of a period of ten (10) days from
the date such Final Notice is effective pursuant to Section 1.19, and upon
expiration of such ten (10) day period this Agreement shall terminate. If,
however, within such ten (10) day period the defaulting party cures such default
by paying all such amounts as may be required to be paid by the defaulting party
hereunder, then this Agreement shall not terminate by reason of such Final
Notice.
Subject to the terms and provisions hereof, upon the occurrence of an
FM&M Default of the type described in Section 1.09.A(2) or a Decoma Default of
the type described in Section 1.09.B(2), the non-defaulting party shall have the
right to give the defaulting party notice ("Final Notice") of its intention to
terminate this Agreement after the expiration of a period of sixty (60) days
(subject to the provisions of Section 1.11 relating to force majeure) from the
date such Final Notice is effective and upon expiration of such sixty (60) day
period, this Agreement shall terminate. If, however, within such sixty (60) day
period, the defaulting party cures such default, or if such default cannot
reasonably be cured within such sixty (60) day period, and the defaulting party
begins to cure such default during such sixty (60) day period and (subject to
the provisions of Section 1.11 relating to force majeure) diligently pursue
such cure to successful conclusion, then this Agreement shall not terminate by
reason of such Final Notice.
Subject to the terms and provisions hereof, upon the occurrence of a
FM&M Default of the type described in Section 1.09A(3) or a Decoma Default of
the type described in Sections 1.09B(3), the non-defaulting party [i.e., FM&M or
Decoma as the case may be] shall have the right to terminate this Agreement upon
written notice to the defaulting party and payment of all amounts owing under
this Agreement.
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Subject to the terms and provisions of this Agreement, and subject
further to the limitations on liability hereinbelow set forth, either party
shall have the right upon the occurrence of an FM&M Default or Decoma Default
(as the case may be), as aforesaid, and in addition to the right to terminate
this Agreement, to seek any and all remedies, whether legal, equitable or both,
to which such non-defaulting party may be entitled.
In the event FM&M is finally adjudicated by a court of competent
jurisdiction (said adjudication not being the subject of further appeal or
review) to have committed fraud or willful misconduct with respect to its
obligations under this Agreement, FM&M shall be liable for all proven damages
directly and proximately caused by such fraud or willful misconduct. Except
where FM&M is finally adjudicated by a court of competent jurisdiction (said
adjudication not being the subject of further appeal or review) to have
committed fraud or willful misconduct, as aforesaid, Decoma agrees that any
judgment in favor of Decoma for damages shall be limited to such proven damages
directly and proximately caused by FM&M's default under this Agreement, which
shall in no event exceed the aggregate amount of all Management Fees paid to
FM&M from the date hereof to the date of such judgment, nor shall FM&M ever be
required by any such judgment to expend in satisfaction thereof funds in excess
of such amount. Except as expressly provided in the immediately preceding
sentence, in no event whatsoever and under no circumstances (howsoever
occurring) shall FM&M be liable to Decoma (or any other party whomsoever) for
any of the following:
(1) Event-Related Expenses;
(2) Extraordinary Replacement and Repair Expenses;
(3) Operating Expenses;
(4) Operating Losses;
(5) Net Operating Losses;
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(6) Pre-Opening Operating Expenses;
(7) Any other expenses, costs or losses howsoever occurring
resulting from the operation of the Arena or pursuant to the Arena
Contract, whether actual, direct, indirect, special or consequential
in nature; or
(8) Any consequential or special damages.
Notwithstanding anything to the contrary in this Agreement, the constituent
partners, employees, and agents of FM&M (or any of its predecessors in
interest) shall not be personally liable for any damages or other obligations
whatsoever, under any theory of action or recovery, as a result of a default by
FM&M hereunder.
C. In the event of the occurrence of a Decoma Default or FM&M
Default, the non-defaulting party shall, in addition to its other rights and
remedies hereunder, have the right to recover from the defaulting party the
reasonable costs and expenses incurred by the non-defaulting party in enforcing
its rights and remedies, including reasonable attorney's fees. A termination
of this Agreement by either Decoma or FM&M by reason of a FM&M Default or
Decoma Default, shall not relieve either party of any of its obligations
theretofore accrued prior to and through the effective date of such termination.
D. Decoma agrees that FM&M has been appointed Decoma's special
agent to supervise, administer and manage the Operating Work for the Arena on
and subject to the provisions of, and for the Term of this Agreement. Thus,
notwithstanding any other provisions of this Agreement, and without waiver of
any of FM&M's rights and remedies hereunder, Decoma and FM&M agree that, if
Decoma breaches this Agreement by wrongfully terminating, or wrongfully
purporting to terminate, in whole or in part, FM&M's position as manager
hereunder (i) FM&M's rights to perform the services herein and the benefits
hereof to FM&M shall be deemed to be unique; (ii) FM&M's remedy at law may be
inadequate to compensate FM&M for partial or complete loss of position
of FM&M
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hereunder, and (iii) FM&M shall be entitled to seek or obtain or to plea for a
decree by a court of competent jurisdiction directing Decoma to restore FM&M to
FM&M's full position as described herein and to comply with all of the
provisions hereof. The remedies available to FM&M shall be non-exclusive,
cumulative of and additional to all other remedies available at law or in
equity.
E. Decoma and Operator recognize that the profits and fees to be
realized by FM&M under this Agreement are difficult, if not impossible, to
accurately ascertain on the date hereof. Moreover, Decoma recognizes that
FM&M's agreement to manage and operate the Arena was procured on FM&M's
reliance that it would be able to do so for the full Term so long as FM&M is not
in default hereunder beyond any applicable period of notice, grace or
opportunity to cure. Decoma and FM&M recognize that at an early termination of
this Agreement (resulting form an early termination of the Arena Contract) can
reasonably be anticipated to cause FM&M to fail to obtain the fully expected
benefits of this Agreement and to forego a portion of FM&M's expected
Management Fee.
F. Upon the termination of this Agreement as provided herein, FM&M
shall surrender the Premises to Decoma in accordance with the provisions of
Section D.1.5 of the Arena Contract (but without the payment of any termination
fee or payment other than payments owing to FM&M under the terms of this
Agreement) as if the Owner referred to therein was Decoma and the Operator
referred to therein was FM&M.
G. Upon termination of this Agreement for any reason and payment of
all sums owing to FM&M, FM&M shall deliver to Decoma the following:
(1) a final report, reflecting the data and information provided for in
Section 1.02A(8) of this Agreement, as of the date of termination, such
report
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to be deliverd within thirty (30) days after such termination;
(2) any monies of the Operator or Decoma, or otherwise relating
to the Arena, held by FM&M, to be delivered promptly upon such
termination; and
(3) all records, contracts, unpaid bills and other papers or
documents of Decoma held by FM&M and relating to the operation of the
Arena, or otherwise relating to the Arena, all such documents to be
delivered promptly upon such termination.
H. Subject to the terms hereof, all sums due and owing by
Decoma to FM&M under this Agreement shall be secured by a lien (subordinated as
hereinafter set forth) in favor of FM&M on all monies due and owing to Decoma
pusuant to the Arena Contract therein and thereunder and on all of Decoma's
rights and interests in any monies or distributions from Decoma, Ltd. and/or
Operator, but expressly excluding any monies held for the benefit of or
intended for distribution to the limited partner of Decoma, Ltd. or the limited
partners of Operator; provided, however, said lien hereby granted in favor of
FM&M shall be expressly subordinate to (i) the lien granted to Concessionaire
under the Concession Agreement with respect to the Termination Fee (referred to
therein) and (ii) with respect to the following: If at any time or from time
to time Decoma, in its reasonable discretion, determined that it is necessary
for Decoma, Ltd., in its capacity as general partner of Operator, to contribute
or loan (a "Decoma Miami Advancement") additional sums to Operator to be used
by Operator to avert a materially adverse financial situtation for Operator
(the amount of such contribution or loan being hereinafter referred to as the
"Advancement Amount"), Decoma may, in its discretion, elect to obtain the funds
for such Decoma Miami Advancement by either (a) financial arrangements
("Third-Party Project Loans") with third-party lenders ("Project
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Lenders"); (b) loans by the Venturers to Decoma ("Venturer Project Loans"); (c)
capital contributions by the Venturers to Decoma ("Venturer Project
Contributions"); or (d) a combination of Third-Party Project Loans and Venturer
Project Loans, or Third-Party Project Loans and Venturer Project Contributions.
For the purposes hereof, the terms and provisions of said Third-Party Project
Loans, Venturer Project Loans and Venturer Project Contributions shall be
subject to and governed by the provisions of Section 4.01 of the Articles of
Limited Partnership of Decoma, Ltd. Accordingly, any such lien in favor of
Concessionaire, Third-Party Project Loans, Venturer Project Loans and Venturer
Project Contributions, as aforesaid, shall be a priority lien over the lien
rights granted to FM&M hereunder. The subordination herein provided is
intended to be self-effecting, but FM&M agrees to promtply execute and
deliver, from time to time, such instruments as Decoma may reasonably request
to evidence the subordination herein provided.
I. In the event that FM&M determined that an Owner Default (as
defined in the Arena Contract) has occurred, then in connection with any such
asserted Owner Default, the following shall apply:
(1) FM&M, acting in its capacity as manager of the Arena
hereunder, shall notify Decoma of such asserted Owner Default, and
shall be entitled to send, in its own name (but not in the name of
Decoma) a notice of such determination to Owner, with a copy of such
notice to Owner to be forwarded to the Venture Representatives of
Decoma. Thereupon, the Venture Representatives shall, in the exercise
of good faith, in an expeditious and prompt manner, make a
determination as to whether or not any such Owner Default has actually
occurred. FM&M may include with such copy of such notice any proposed
action that
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FM&M would recommend that Decoma should take against the Owner under
the terms of the Arena Contract as a result of any such Owner Default.
The determination of whether any Owner Default actually has occurred
shall be made by Decoma. In the event that such determination is made
by the Venture Representatives, then, in such event, the Managing
Venturer of Decoma (or other Venturer so directed by the Venture
Representative) shall be obligated to send a notice of such Owner
Default to Owner in accordance with the terms and provisions of the
Arena Contract. In the event that Decoma and all Venture
Representatives fail to respond within thirty (30) days to FM&M's
request that an Owner Default be declared by Decoma under the Arena
Contract, then, in such event, FM&M shall be deemed empowered and
authorized in the name of Decoma and in Decoma's capacity as sole
general partner of Operator, to send such notice of an Owner Default
to Owner (with a copy to all Venture Representatives); and
(2) In the event that any such Owner Default has been sent under
the terms of subparagraph (1) preceding (either by Decoma or by FM&M
acting on behalf of Decoma as aforesaid), then, upon the expiration of
all applicable periods of notice and opportunity to cure provided for
in the Arena Contract on account of an Owner Default and in the event
that following the expiration of such period of notice and opportunity
to cure, such Owner Default still remained uncured, then, Decoma shall,
in the exercise of good faith, and in an expeditious and prompt manner
make a determination of the appropriate remedy (or remedies), if any,
to be
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enforced against Owner on account of any such Owner Default and notify
FM&M of such determination; provided, however, in the event that
neither Decoma nor any of the Venture Representatives notifies FM&M not
to proceed as FM&M recommended within thirty (30) days (following the
expiration of the applicable period of notice and opportunity to cure
afforded Owner for an Owner Default under the Arena Contract), then in
such event FM&M shall be deemed empowered and authorized in the name of
Decoma and in Decoma's capacity as sole general partner of Decoma,
Ltd., and in turn acting on behalf of Decoma, Ltd. as sole general
partner of Operator to enforce the remedy or remedies originally
recommended by FM&M to Decoma against Owner.
1.10 Indemnity. Except where FM&M is finally adjudicated by a court of
competent jurisdiction (said adjudication not being the subject of further
appeal or review), to have committed fraud or willful misconduct or a breach of
any material provision of this Agreement, Decoma covenants and agrees to
indemnify, defend, protect, save and hold harmless FM&M (and all partners,
shareholders, directors, officers, employees, agents and representatives of
FM&M) (FM&M and all such other parties named in the preceding parenthetical
being hereinafter referred to collectively as "Indemnitees" and where the
context requires, singularly, as "Indemnitee") from any and all liabilities,
losses, costs, damages, obligations, claims and expenses (including, without
any limitation, reasonable attorney's fees and court costs) that Indemnitees
(or any Indemnitee) may directly or indirectly sustain, suffer or incur out of
or in connection with or arising from any allegations or claims and any
actions, suits or proceedings relating to such allegations or claims
(collectively referred to herein as the "Claims") by any person, party, firm or
corporation or any
government authority (including the United States, the State of Florida, Dade
County, the City of Miami, the MSEA, or any other political subdivision, agency
or instrumentality exercising jurisdiction over the Arena, Decoma or FM&M)
(collectively the "Claimant") relating in any way to the performance of the
Operating Work or any other services provided by FM&M hereunder. Decoma agrees
to and does hereby assume the defense on behalf of Indemnitees (and any
Indemnitee) of any action at law or in equity which may be brought by Claimants
(or any one of them) against Indemnitees (or any Indemnitee) by reason of such
Claims (whether or not such Claims are based on the passive or active
participation of Indemnitees (or any Indemnitee) and to pay on behalf of such
Indemnitees (or any Indemnitee), provided that such Indemnitees have compiled
with the provisions of this Section 1.10, upon demand, the amount of any
judgment which may be entered against Indemnitees (or any Indemnitee) in any
such action (except as above provided); provided, however, that without
relieving Decoma of any obligations under this Agreement, Indemnitees (or any
Indemnitee) at their election, may select counsel of their own choosing to
defend or participate in the defense of any or all of the Claims. In the event
any Claims are asserted or commenced against Indemnitees (or any Indemnitee),
FM&M shall give written notice thereof to Decoma. Decoma shall then have
thirty (30) days (or such earlier period of time as may be required to respond
to any such Claims) from the date of such written notice to satisfy or commence
the defense of any such Claims. FM&M agrees, to the extent reasonable and
necessary (without incurring any cost or expense in connection therewith for
all of which FM&M is hereby indemnified), to cooperate with Decoma in
connection with any such defense of any of the Claims (and the failure to
cooperate shall release Decoma from all obligations under this Section 1.10);
provided, however, in no event shall FM&M be required to become a defendant or
otherwise
join in any of the Claims unless FM&M is itself named a party defendant in any
one of the Claims by the party who has brought such suit, action or proceeding.
Notwithstanding any other provision of this Agreement, in no event
shall Decoma make any claim against FM&M on account of any alleged errors in
judgment made in good faith and in the exercise of reasonable and professional
prudent judgment by FM&M in connection with the performance of the Operating
Work provided or to be provided by FM&M under this Agreement.
1.11 Force Majeure. Neither party to this Agreement shall be obligated
to perform and neither party shall be deemed to be in default hereunder, if
performance of a non-monetary obligation is prevented by the occurence of any
of the following, other than as a result of a financial inability to perform,
(herein called "force majeure" or "event of force majeure") acts of God,
strikes, lockouts, other industrial disturbances, acts of the public enemy,
Legal Requirements, wars or war-like action (whether actual, impending or
expected and whether de jure or de facto), arrest or other restraint of
government (civil or military), blockades, insurections, riots, epidemics,
landslides, lightning, earthquakes, fires, hurricanes, storms, floods,
washouts, civil disturbances, explosions, breakage or accident to equipment or
machinery, confiscation or seizure by any government or public authority,
nuclear reaction or radiation, radioactive contamination or any other causes,
whether for the kinds herein enumerated or otherwise, that are not reasonably
within the control of the party claiming the right to delay performance on
account of such occurrence.
1.12 Assignment
A. FM&M shall have the right to assign this Agreement to any
"affiliate" of FM&M. Otherwise, FM&M shall not, without Decoma's prior written
approval (which may be given or denied in Decoma's sole and absolute
discretion) assign any of its rights,
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other than its right to receive the fees payable to FM&M as herein provided
(which FM&M may freely transfer or encumber; however, the assignment of any of
the rights to receive the fees payable to FM&M herein shall be limited only to
an assignment of proceeds [and as a result thereof, such assignee of such
proceeds shall not have any rights of FM&M, except to the proceeds and shall
not perform any of the Operating Work or perform any other duties of FM&M under
this Agreement]), or its obligations under this Agreement, whether by operation
of law or otherwise. For purposes of this Agreement an "affiliate" of FM&M
shall mean any corporation, partnership, or other entity controlled by,
controlling, or under common control with FM&M. "Control" shall mean and refer
to the ownership of at least fifty-one percent (51%) of the outstanding voting
securities or beneficial ownership interest of the controlled entity. Any
consent by Decoma to any such assignment, shall not be deemed a waiver of the
restrictions herein contained against assignment in any subsequent case.
1.13 Representatives and Officers and Directors of FM&M Not
Individually Liable. Notwithstanding anything to the contrary in this
Agreement, not constitutent partners (or any of their officers, directors,
employees, shareholders, official representatives, or agents), employees,
agents, members, directors, officers, shareholders, officials or
representatives of FM&M or any of its predecessors-in-interest (or any of their
officers, directors, employees, shareholders, official representatives, or
agents) or any affiliate (or any of their officers, directors, employees,
shareholders, official representatives, or agents) of FM&M shall be personally
liable to Decoma (or to any of the Venturers), Decoma, Ltd. (or to any of its
partners), Operator (or to any of its partners), the MSEA, or the City or any
one claiming under any of such parties in the event of a FM&M Default or for
any amount which may become due to Decoma, Decoma,
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Ltd., Operator, the MSEA or any such other party, or on any obligations under
the terms of this Agreement.
1.14 Decoma Consent; Amendment of Arena Contract; Other Amendments.
Decoma agrees for itself and in its capacity as the general partner of Decoma,
Ltd. and for Decoma, Ltd. in its capacity as the general partner of Operator
that, during the term of this Agreement, it shall not materially amend or
modify the Arena Contract, the Block 44/57 Agreement, the Decoma Joint Venture
Agreement, the partnership agreement of Decoma, Ltd. or the partnership
agreement of Operator, or any other agreement related to the Project Land or
the use or operation of the Arena without the prior written consent of FM&M
(which FM&M agrees not to unreasonably withhold or delay), if as a result of
such amendment or modification to such agreement the obligations of FM&M
hereunder would be enlarged or the rights of FM&M hereunder would be reduced.
However, the prior written consent of FM&M shall not be required if HSA
Management, Inc., as one of the Venturers of Decoma, has, in connection
therewith, granted (or was deemed to have granted) its consent to the
modification or amendment to the agreement then in question.
1.15 No Partnership. Neither the agreement to pay FM&M the Incentive
Bonus or any other provision hereof shall ever constitute a partnership or
joint venture relationship between Decoma and FM&M, and, notwithstanding such
provisions, no partnership or joint venture between the parties is intended to
be or is hereby created. Subject only to the provisions of Section 3.5(b) of
the Joint Venture Agreement, Decoma, the Venturers and FM&M each reserve and
retain the right to engage in all businesses and activities of any kind
whatsoever (irrespective of whether the same may be in competition with the
business and activities of Decoma, Decoma, Ltd., Operator or FM&M), and to
acquire and own all assets however acquired and wherever situated, and to
receive compensation or profit therefrom, for
-35-
each of their own accounts and without in any manner being obligated to
disclose such business and activities or assets or compensation or profit to
the other. By way of illustration of the foregoing, but not in limitation
thereof, it is recognized that FM&M is a joint venture organized for the
purpose of providing management services to assembly, convention and trade show
centers, sports, entertainment and other leisure and recreational type
facilities and the provision of design and management consulting services in
connection therewith. Accordingly, except as provided in Section 3.5(b) of the
Joint Venture Agreement, the pusuit by FM&M and the involvement of FM&M in any
of such activities shall in no way obligate FM&M to Decoma (or the Venturers),
Decoma, Ltd. (or its partners) or Operator (or its partners) or hold FM&M
accountable to Decoma, Decoma, Ltd. or Operator (or such Venturers or partners)
for any reason whatsover or otherwise restrict in any way the freedom of FM&M
to conduct any such business or activity.
1.16 Operator's Representative. The Managing Venturer under the Joint
Venture Agreement shall be designated Operator Representative under the Arena
Contract, however, such Managing Venturer shall not give any consents or
approvals required of it under the Arena Contract if it in any material way
relates to the Operating Work or any of the rights, duties and obligation of
FM&M hereunder without first obtaining the prior written consent of FM&M (which
consent shall not be unreasonably withheld or delayed).
1.17 Exclusive and Non-Competition Agreement. Other than with respect
to the Concessionaire Agreement and subject to the rights of the Venturers
under the Joint Venture Agreement, during the term of this Agreement, Decoma
shall not enter into any agreement with any other person or entity (i) to
develop, construct, manage or operate the Arena, (ii) to negotiate, execute or
perform contracts with persons or entities who desire
-36-
to exhibit or perform in the Arena, (iii) to negotiate, execute or perform
contracts for the use of advertising space within the Arena, (iv) to operate
concessions within the Arena or on the Project Land, or (v) any other rights in
any way relating to the performance of the Operating Work, all as herein
granted to FM&M under this Agreement and FM&M shall have the exclusive power
and authority to perform all such acts.
1.18 Insurance.
A. FM&M shall use reasonable efforts to obtain or cause to be obtained
at Decoma's expense, and shall use reasonable efforts to keep in force during
the Term of this Agreement, all of the insurance required under Paragraph E.1.4
of Exhibit "E" to the Arena Contract. Such insurance shall comply with and be
consistent in all respects with the insurance required of Operator under
Exhibit "E" to the Arena Contract, and shall be endorsed specifically to
include within its scope of coverage all liabilities and indemnities for which
Decoma and FM&M are obligated and liable under the terms of this Agreement.
Such insurance shall be written by companies selected by FM&M and that meet the
requirements set forth in Paragraph E.3 of Exhibit "E" to the Arena Contract,
and shall name Decoma, Ltd., Decoma and each of the Venturers as insureds, and
FM&M as an additional insured. So long as FM&M complies with the requirements
of this Section 1.18, FM&M shall not be in default under this Agreement even
though the insurance obtained or sought to be obtained or maintained in force
hereunder does not satisfy all of the requirements under the Arena Contract.
B. FM&M shall use reasonable efforts to cause every policy referred to
or required under this Agreement to comply with Paragraph E.2 of Exhibit "E" to
the Arena Contract, and to provide that each policy include a waiver of all
rights of subrogation (in addition to the waiver of all rights of subrogation
set forth in Paragraph E.2(c) of Exhibit "E" to the
-37-
Arena Contract) in favor of Decoma, Ltd., Decoma, each of the Venturers, FM&M
and their officers, directors, employees, and/or their constituent partners.
C. Cooperation. Decoma and FM&M each shall furnish to the other
whatever information is requested by the other for the purpose of establishing
insurance coverages.
1.19 Miscellaneous.
A. Any notice which shall or may be given under this Agreement shall
be in writing and shall be sent by United States registered or certified mail,
postage prepaid, return receipt requested, addressed to the parties as follows,
or delivered in person to such address:
If to FM&M: 8701 Kirby, The Astrodome
Houston, Texas 77054
Attention: Mr. Neal Gunn
With a copy to: Denis Clive Braham, Esq.
Dow, Cogburn, & Friedman
9 Greenway Plaza, Suite 2300
Houston, Texas 77046
If to Decoma: BIL Development, Inc.
1400 Sage Plaza
5151 San Felipe
Houston, Texas 77056
Attention: Mr. C. Dean Patrinely
With a copy to: James B. Rylander, Esq.
Vinson & Elkins
3300 First City Tower
1001 Fannin
Houston, Texas 77002-6760
With a copy to: Howard T. Ayers, Jr.
Woodard, Hall & Primm
4700 Texas Commerce Tower
Houston, Texas 77002
Any party shall have the right to change its address for the purpose of notice
by giving notice to the other party in accordance with the provisions hereof.
Each notice shall be effective three (3) days after being deposited in the U.S.
Mail or upon receipt if delivered in person.
B. The titles of the paragraphs of this Agreement shall have no effect
and shall neither limit nor amplify the provisions of the Agreement itself.
-38-
C. This Agreement, including Exhibit "A" which is attached hereto and
incorporated herein for all purposes, constitutes the entire agreement between
the parties relating to the subject matter hereof. This Agreement shall not be
amended or changed except by written instrument signed by the party to be
charged therewith.
D. This Agreement has been entered into in the State of Texas, and shall
be governed by the laws of the State of Texas.
E. Acceptance by either Decoma or FM&M of any payment made by the other
party shall not constitute a waiver of the right of such recipient to contest
whether or not the full amount due shall have been paid nor a waiver of any
other rights hereunder. Failure by Decoma or FM&M to complain of any action,
nonaction or default of the other party shall not constitute a waiver of any
rights hereunder, nor shall the waiver of any right occasioned by a default in
any one or more instances constitute a waiver of any right occasioned by either
a subsequent default of the same obligation or occasioned by any other default.
F. The terms and provisions of this Agreement shall inure to the benefit
of and be enforceable by the parties hereto and their permitted assignees.
G. Any agreement to pay an amount and any assumption of liability herein
contained, express or implied, shall be only for the benefit of the undersigned
parties and their respective successors and assigns (as permitted by this
Agreement), and such agreements and assumptions shall not inure to the benefit
of the obligees of any indebtedness or any other party, whomsoever, it being the
intention of the undersigned that no one shall be deemed to be a third-party
beneficiary of this Agreement.
1.20 EXCULPATION OF LIABILITY. Notwithstanding anything to the contrary
in this Agreement, and notwithstanding the theory of recovery or cause of
action, neither the
-39-
constituent venturers of Decoma, nor their respective partners, shareholders,
members, directors, officers, employees or agents, shall ever be personally
liable to FM&M, or anyone claiming by, through or under FM&M, in the event of
any Decoma Default hereunder, or for any amount which may become due to FM&M
hereunder, or for any obligation of Decoma under the terms and provisions of
this Agreement. However, notwithstanding the preceding sentence, FM&M shall
have the right to recover from Decoma any and all Decoma funds and/or Decoma
assets in the event of any Decoma Default.
SIGNATURE PAGE FOLLOWS ...
-40-
EXECUTED in multiple counterparts, each of which shall have
the force and effect of an original, as of the date and year first
above written.
DECOMA VENTURE, a Texas joint
venture, by its Venturers
By: /s/ C. Dean Patrinely
------------------------------
C. DEAN PATRINELY, President,
BIL Development, Inc.
By: /s/ Neal Gunn
-----------------------------
NEAL GUNN, Vice-President,
HSA Management, Inc.
By: /s/ Glen D. Graff
------------------------------
GLENN D. GRAFF, Vice President
Linbeck Miami Corp.
FACILITY MANAGEMENT & MARKETING,
a Texas joint venture, by its
venturers
ASH ENTERPRISES, INC.
By: /s/ Neal Gunn
-----------------------------
NEAL GUNN
Vice President
FACILITIES OPERATING ENTERPRISES,
a Texas partnership by its
partnership representatives,
CENTURY FACILITIES, INC.
By: /s/ Walter Ross
----------------------------
WALTER ROSS, President
BARMAC, INC.
By: /s/ Mike McGee
-----------------------------
MIKE McGEE, President
SIGNATURE PAGE OF
ARENA MANAGEMENT AGREEMENT
BY AND BETWEEN
DECOMA VENTURE
AND
FACILITY MANAGEMENT AND MARKETING
DCB/TJM/djl
9/10/86
DCB83A
EXHIBIT "A"
PROFORMA
[Download Table]
NET OPERATING INCENTIVE
YEAR INCOME BONUS LIMIT*
---- ------------- ------------
1988 $ 33,000 $ 325,000
1989 $ 42,000 $ 341,250
1990 $ 32,000 $ 358,313
1991 $ 1,000 $ 376,228
1992 $ (110,000) $ 395,040
1993 $ 28,000 $ 414,792
1994 $ 15,000 $ 435,531
1995 $ 32,000 $ 457,308
1996 $ 16,000 $ 480,173
1997 $ (65,000) $ 504,182
1998 $ 99,000 $ 529,391
1999 $ 117,000 $ 555,860
2000 $ 101,000 $ 583,653
2001 $ 121,000 $ 612,836
2002 $ 6,000 $ 643,478
2003 $ 128,000 $ 675,652
2004 $ 116,000 $ 709,434
2005 $ 121,000 $ 744,906
2006 $ 121,000 $ 782,151
2007 $ 26,000 $ 821,259
2008 $ 127,000 $ 862,322
2009 $ 133,000 $ 905,438
2010 $ 134,000 $ 950,710
2011 $ 141,000 $ 998,245
2012 $ 42,000 $ 1,048,157
2013 $ 150,000 $ 1,100,565
2014 $ 152,000 $ 1,155,594
2015 $ 160,000 $ 1,213,373
2016 $ 163,000 $ 1,274,042
2017 $ 72,000 $ 1,337,744
2018 $ 171,000 $ 1,404,631
2019 $ 181,000 $ 1,474,863
And for as said last as said
all years amount is last
thereafter increased by amount is
5% per year increased
by 5% per
year
*Notwithstanding anything to the contrary contained in Section 1.08(B)
of the Agreement, to which this Exhibit "A" is attached, the Incentive Bonus
Limit with respect to any year shall be the lesser of:
(i) the dollar amount set forth above as the Incentive Bonus Limit for
such year on this Exhibit "A"; or
(ii) the dollar amount equal to (a) sixty-seven and one-half percent
(67-1/2%) of that portion of the Operator's Operating Income Allocation
("OOIA", as defined in the Arena Contract) for the applicable year involved
which is actually distributed to Decoma by Decoma, Ltd., and which is available
for distribution by Decoma to its Venturers as Distributable Funds (as defined
in the Joint Venture Agreement) (such portion of OOIA actually received by
Decoma and available for
Exhibit "A"
Page 1 of 2 Pages
distribution to the Venturers being herein referred to as the "Venture
OIA"), less and reduced by (b) the dollar amount, if any, of Venture OIA
payable to the owners of, or distributable with respect to, the initial
33-1/3% Venture ownership interest of HSA in Decoma (whether or not all or
any portion of such interest is then owned by HSA), but not reduced by any
other portion of Distributable Funds payable or distributable with respect
to the initial HSA Venture interest.
For purposes of this Exhibit "A", Decoma and FM&M recognize and agree
that in order to compute and determine the Venture OIA under subsection (ii)
(a) above, certain computations must first be made at the Decoma Miami
(Operator) partnership level to take into account that portion of the OOIA
distributable to the limited partners of Operator, and then similarly a
computation must be made at the Decoma, Ltd. partnership level to take into
account that portion of OOIA distributable to the Limited Partner (as defined
in the partnership agreement of Decoma, Ltd.), and that each of such
computations will reduce the OOIA to be distributed to Decoma as Venture OIA.
With respect to any such distribution to the Limited Partner of Decoma, Ltd.,
such portion of the OOIA is a portion of the "Available Amount" (as such term
is defined in the partnership agreement of Decoma, Ltd.). Notwithstanding the
fact that the partnership agreement of Decoma, Ltd. does not distinguish or
prioritize payments to the Limited Partner of any portion of the Available
Amount [whether OOIA, Operator's Seat Use Allocation ("OSUA") or the Variable
Operating Payment ("VOP"), as such terms are defined in the Arena Contract],
for the purposes of computing the Venture OIA to in turn compute the Incentive
Bonus Limit hereunder, the Available Amount payable to the Limited Partner
shall be deemed to be first satisfied by allocating such sources of revenue in
the following priority, whether or not the Limited Partner actually received
the Available Amount in such order: first, OSUA; then, VOP; and then, the OOIA
component of the Available Amount.
To the extent Venture expenses of Decoma reduce the amount of
Distributable Funds of Decoma, all such expense shall be deemed to have been
paid first out of OSUA distributed by Decoma, Ltd. to Decoma, then out of VOP
distributed by Decoma, Ltd. to Decoma, and then out of Ventura OIA.
Nothing contained in this Exhibit "A" shall alter or affect the
provisions of Section 1.08 of this Agreement which condition the payment of the
Incentive Bonus (as well as the Management Fee) upon the payment by MSEA to
Operator of the Operating Payment and the receipt by Decoma of such funds.
DCB/djl
9/30/86
DCB83A
Exhibit "A"
Page 2 of 2 Pages
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-1’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 10/10/96 | | 2 | | | | | None on these Dates |
| Filed on: | | 9/18/96 |
| List all Filings |
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