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-10.2 — Broward Co. Civic Arena Operating Agreement
Exhibit Table of Contents
Exhibit 10.2
BROWARD COUNTY
CIVIC ARENA
OPERATING AGREEMENT
DATED AS OF JUNE 4, 1996
BY AND BETWEEN
BROWARD COUNTY, FLORIDA
THE COUNTY
AND
ARENA OPERATING COMPANY, LTD.
THE OPERATOR
TABLE OF CONTENTS
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PAGE
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II
ENGAGEMENT OF OPERATOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.1 Engagement of Operator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.2 Authority of Operator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.3 Duty and Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.4 County Representative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.5 Operator Representative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.6 Operator Pre-Operations Start Date Duties . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE III
TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.1 Commencement and Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.2 Options to Extend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE IV
OPERATOR'S RIGHTS AND OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.1 Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.2 Use Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.3 Promotions Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.4 Marketing and Public Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.5 Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.6 Naming Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.7 Concessions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.8 Booking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.9 Ticketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.10 Affiliate Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.11 Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.12 Changes in Parking Area Configuration . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.13 Security and Traffic Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.14 Base Management Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.15 Incentive Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.16 Small Disadvantaged Business Enterprise Participation . . . . . . . . . . . . . . . . . . . 19
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4.17 Personal Seat Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE V
FINANCIAL OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.1 Facility Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.2 Distribution of Funds from Operating Fund . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.3 Distribution of Net Operating Income and Other Funds . . . . . . . . . . . . . . . . . . . 21
5.4 Availability of Funds in Operating Fund; Working Capital Loans . . . . . . . . . . . . . . 22
5.5 Distribution of Funds from Operating Fund and Renewal and Replacement Account during
Abatement Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.6 Renewal and Replacement Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.7 Operating Reserve Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.8 Distribution of Funds from Accounts Upon End of Term . . . . . . . . . . . . . . . . . . . 23
5.9 Reduction of County Preferred Revenue Allocation . . . . . . . . . . . . . . . . . . . . . 24
5.10 Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VI
OWNERSHIP AND USE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.1 County Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.2 County Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.3 County Access . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE VII
RECORDS AND AUDITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.1 Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.2 Accounting Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.3 Financial Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7.4 Additional County Audits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7.5 Underreporting of Facility Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE VIII
ADDITIONS AND CAPITAL REPAIRS; EMERGENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
8.1 Operator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
8.2 Incremental County Preferred Revenue Allocation . . . . . . . . . . . . . . . . . . . . . . 28
8.3 Operator Right to Finance Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8.4 County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
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ARTICLE IX
IMPOSITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.2 Permitted Contests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.3 Ad Valorem Tax Imposition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.4 Exclusive Taxes and Special Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE X
INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
10.1 Indemnification of County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
10.2 Indemnification of Operator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.3 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.4 Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE XI
INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.1 Casualty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.2 Business Interruption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.3 Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.4 Workers Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.5 Builder's Risk or Installation Floater . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.6 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.7 Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.8 Insurance for County Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
11.9 Waiver of Recovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
11.10 Failure to Maintain Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
11.11 Proceeds Disposition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE XII
DAMAGE OR DESTRUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
12.1 Adequately Insured Damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
12.2 Insurance Deficiency and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
12.3 End of Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
12.4 Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
12.5 Abatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE XIII
EMINENT DOMAIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
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13.1 Substantial Taking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
13.2 Partial Taking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
13.3 End of Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
13.4 Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
13.5 Abatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
13.6 No Condemnation by County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE XIV
ASSIGNMENT AND TRANSFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
14.1 Right to Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
14.2 Prohibition Against Assignment of Agreement or Transfer of the Facility by the County . . . 39
ARTICLE XV
REPRESENTATIONS, WARRANTIES AND COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
15.1 County Representations, Warranties and Covenants . . . . . . . . . . . . . . . . . . . . . 39
15.2 Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
15.3 Optional Remedy of Operator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
15.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
15.5 Operator Representations, Warranties and Covenants . . . . . . . . . . . . . . . . . . . . 42
15.6 Mutual Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE XVI
DEFAULTS, REMEDIES AND TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
16.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
16.2 Institution of Litigation Permitted by Article XVIII . . . . . . . . . . . . . . . . . . . 46
16.3 Rights and Remedies are Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
16.4 Costs, Expenses and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
16.5 Acceptance of Legal Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
16.6 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE XVII
DISPUTE RESOLUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE XVIII
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
18.1 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
18.2 Time of Essence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
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18.3 Relationship of Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
18.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
18.5 Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
18.6 Interpretations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
18.7 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
18.8 Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.9 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.10 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.11 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.12 Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.13 Nondiscrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
18.14 Reasonableness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE XIX
LIABILITY LIMITATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
19.1 County and Operator Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
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OPERATING AGREEMENT
This Operating Agreement ("Agreement"), is dated as of June 4, 1996
and entered into by and between Broward County, Florida, a public body
corporate and politic and a political subdivision of the State of Florida (the
"County"), and Arena Operating Company, Ltd., a Florida limited partnership
(the "Operator").
RECITALS:
A. On April 2, 1996, the County and the Florida Panthers Hockey
Club, Ltd. (the "Team") entered into a Letter of Intent (the "Letter of
Intent") setting forth the outline of terms and conditions under which the
County and the Team would move forward to expeditiously develop a new
multipurpose civic arena to be financed and owned by the County (the
"Facility").
B. On even date herewith the County and Arena Development
Company, Ltd. the ("Project Developer") entered into a Development Agreement
(the "Development Agreement") setting forth the terms under which the Project
Developer will develop and construct the Facility.
C. On even date herewith, the County, the Team and the Operator
have executed a License Agreement (the "License Agreement") under which the
Team will play its Home Games in the Facility and otherwise use the Facility in
accordance with the terms of the License Agreement.
D. The County has determined to grant to the Operator the
exclusive right to manage and operate the Facility after completion of
construction pursuant to the terms and conditions stated herein.
E. The Operator is a Florida limited partnership formed by and
is an affiliate of the Team, which the Team has selected as the Operator
pursuant to the Letter of Intent. The Operator will operate and manage the
Facility pursuant to the terms of this Agreement.
F. The Operator and County acknowledge that their respective
duties and obligations hereunder, are absolute and unconditional, except where
specifically provided to the contrary herein.
G. The health, safety and general welfare of the people of the
County are directly dependent upon the continual encouragement, development,
growth and expansion of business, commerce and tourism. The development of a
major multipurpose sports and entertainment complex and accessory uses is most
appropriate in the County which, because of its size, is capable of retaining
and supporting professional as well as amateur sports teams and attracting
major national sporting and musical, cultural, family and community events; and
that attraction of business and tourism to the County as a result of the
development of such a facility and its accessory uses will be an important
factor in the continued encouragement, promotion, attraction, stimulation,
development, growth and expansion of business, commerce and tourism within the
County. The
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development and promotion of a multipurpose sports and entertainment complex on
public property will provide significant benefits to the general public.
H. In view of the foregoing, the County has determined that the
operation of the Facility, the licensing of same under the License Agreement
and the performance of this Agreement, are in the best interests of the County
and the welfare of its residents, and in accord with valid public purposes.
NOW, THEREFORE, intending to be legally bound, for valuable
consideration, the receipt and sufficiency of which are acknowledged, the
parties agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, capitalized terms shall have the meanings
set forth below unless otherwise defined herein. Certain other capitalized
terms which are not defined herein shall have the meanings provided in the
Development Agreement or the License Agreement; however, in the event of a
conflict between a defined term used herein that is defined in both the License
Agreement and the Development Agreement then for purposes of use of the
Facility, the License Agreement will control and for the purposes of Project
development, the Development Agreement will control.
1.1 Abatement Period(s) means any period for which the time
for performance or the deadline for satisfaction of a condition or the
expiration date under any of the Related Agreements is extended as a result of
events described in any of the Related Agreements. Any Abatement Period under
any of the Related Agreements shall be deemed to be an Abatement Period for
every other such Related Agreement.
1.2 Accounts means any accounts that are required to be
maintained by Operator under the terms of this Agreement including, without
limitation, the Operating Fund, the Renewal and Replacement Account, the
Operating Reserve Account and all other accounts for the deposit of the Facility
Operating Revenue of the Facility as provided in Article V.
1.3 Additions and Capital Repairs shall mean collectively,
any or all installations, alterations, improvements, and purchases of additional
or replacement furniture, machinery or equipment at the Facility, the
depreciable life of which, according to generally accepted accounting
principles, is in excess of one (1) year and expenditures for maintenance or
repairs which extend the useful life of the assets being maintained or repaired
for a period in excess of one (1) year. Additions and Capital Repairs shall be
paid for from the Renewal and Replacement Account.
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1.4 Advertising means all announcements, acknowledgments,
banners, signs, show bills, and other audio or visual commercial messages
displayed, announced or otherwise presented in the Facility including video
messages, but excluding Sponsor Signs.
1.5 Advertising Revenue has the meaning set forth in Section
4.5.
1.6 Affiliate of a specified person means a person who (a)
is directly or indirectly controlled by, or under common control with, the
specified person; (b) owns directly or indirectly thirty-five percent (35%) or
more of the equity interests of the specified person; (c) is a general partner,
officer, director, non-financial institution trustee or fiduciary of the
specified person or of any person described in (a) or (b); or (d) is a son,
daughter, spouse, parent, sibling or in-law of the specified person.
1.7 Agreement shall mean this Operating Agreement.
1.8 Annual Budget means the budget to be prepared by the
Operator as provided in Section 4.1.
1.9 Arena means an approximately 750,000 - 850,000 square
feet multipurpose facility with seating capacity of 18,000 - 19,500 seats for
NHL hockey games, 19,000 to 21,500 seats for basketball and 20,000 - 21,000
seats for concerts or other events, all as is constructed in accordance with the
Program Requirements set forth in the Development Agreement.
1.10 Arena Management Firm shall mean Leisure Management
International, an Affiliate of Operator, who is a firm selected by Operator
which specializes in the management of public assembly facilities similar to the
Facility or any subsequent Person selected by Operator.
1.11 Base Management Fee shall mean a fee paid to Operator or
the Arena Management Firm annually for its services under this Agreement in the
aggregate amount of $250,000, which amount shall increase each year by the
percentage increase in the Consumer Price Index over the preceding Fiscal Year.
1.12 Board means the Board of County Commissioners of Broward
County, Florida.
1.13 Bonds mean the total amount of Professional Sports
Facility Tax and Revenue Bonds, Series 1996 outstanding from time to time and at
any time, including interest and other payment requirements and any
restructuring or refundings thereof, and related costs, which the County incurs
for the purpose of financing the development and construction of the Facility,
all of which is estimated at the time of execution of this Agreement to be in an
original principal amount not to exceed $185 million.
1.14 Business Days means Monday, Tuesday, Wednesday,
Thursday or Friday, excluding County holidays.
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1.15 Certificate of Occupancy means a certificate issued as
described in the Development Agreement.
1.16 City means the City of Sunrise, Florida.
1.17 Communication System means all the audio and visual
communication systems within or at the Facility, including but not limited to
scoreboards, television and loudspeaker systems, public address systems, timers,
clocks, message centers, video screens, signs and marquees, within or at the
Facility.
1.18 Comparable Events has the meaning set forth in Section
15.1.7.
1.19 Competing Facility has the meaning set forth in Section
15.1.7.
1.20 Concessionaire(s) shall mean any Person, including
Operator, operating a Concession.
1.21 Concession(s) shall mean the business of selling,
furnishing or renting of foods, beverages, apparel, game programs, sporting
equipment, goods, novelties or merchandise (but not including parking) in, at,
from or in connection with the operation of the Facility whether sold, furnished
or rented from shops, kiosks or by individual vendors circulating through the
Facility including, without limitation, any restaurant (whether open to the
public or restricted to members thereof), club, membership dining room or other
facility therein for sale of food or beverages, and including sales to fill
orders for any such items received by any Concessionaire operating a Concession
at the Facility by mail, facsimile, telephone or other medium of communication.
1.22 Consumable Concessions means items of food, drink,
tobacco products or other items for consumption which are sold or dispensed at
the Facility.
1.23 Consumer Price Index shall mean the Consumer Price Index
for National Consumers published by the Bureau of Labor Statistics of the U.S.
Department of Labor.
1.24 County means the County of Broward, a public body
corporate and politic operating under a home rule charter and a political
subdivision of the State of Florida, and any of its administrative departments,
divisions and functions and its successors and assigns.
1.25 County Event Revenue shall have the meaning set forth in
Section 6.2 of this Agreement.
1.26 County Events means Non-Commercial Events conducted or
sponsored or co-sponsored by the County or its designee pursuant to its rights
and obligations established in this Agreement.
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1.27 County Preferred Revenue Allocation means an annual
amount equal to the difference between (a) the actual amount of the County's
annual debt service obligation on the Bonds fixed at the time the initial Bonds
are sold and (b) $10,000,000. However unless otherwise agreed to by the
Parties, if an acceptable combination of tax-exempt and taxable financing is not
achieved in accordance with the Plan of Finance attached as Exhibit C to the
Development Agreement, then the initial County Preferred Revenue Allocation
(determined in accordance with the foregoing) shall not exceed Five Million
Dollars ($5,000,000). The County Preferred Revenue Allocation shall be payable
only for as long as the Bonds or any refunding bonds issued to refinance the
Bonds are outstanding. In addition, the County Preferred Revenue Allocation
shall be increased by the amount of the Incremental County Preferred Revenue
Allocation (if any) pursuant to Section 8.2 hereof. The County Preferred
Revenue Allocation shall be adjusted on the interest conversion date (and fixed
on such date) in the event of the sale of any refunding Bonds unless mutually
agreed upon otherwise.
1.28 County Representative is the person authorized to issue
and receive notices on behalf of County with respect to this Agreement and shall
be the person so designated and shall have the rights, duties and
responsibilities described in Section 2.4 of this Agreement.
1.29 Design Development Documents shall have the meaning set
forth in the Development Agreement.
1.30 Development Agreement means the Development Agreement
between the County and the Project Developer, dated as of the date hereof, as
and if amended or restated.
1.31 Emergency means any condition or situation which
threatens (or if not promptly acted upon will threaten) the health, safety or
welfare of users of the Facility or the structure or systems of the Facility
itself or any portion thereof including the Arena and the Parking Areas.
1.32 Emergency Expenditure means any Facility Operating
Expense or expenditure for an Addition or Capital Repair undertaken by the
Operator and deemed necessary by it because of an Emergency.
1.33 Environmental Laws means any federal, state, County or
applicable municipal law, statute, code, ordinance, rule, regulation or judicial
or administrative decision, order or directive relating to environmental
matters, historic preservation matters, or industrial health or safety matters,
including, without limitation, any of the foregoing regulating or applying to
any toxic or hazardous substance or waste or any environmental pollutant, as
those terms are defined in any of the foregoing.
1.34 Event of Default has the meaning set forth in Section
16.1.
5
1.35 Event Related Expenses means those costs and expenses
that will be incurred by Operator in connection with, and directly attributable
to, each event or performance in the Arena or at the Facility and pursuant to an
agreement relating to such event or performance (i) will be reimbursed by the
user or the promoter out of the ticket sales for such event or performance or
(ii) will otherwise be paid by the user or promoter in addition to any other
charges for the use of the Arena or the Facility for such event or performance,
including, but not limited to, expenses for personnel (including ticket takers,
ushers, internal and external security, police, maintenance and cleanup
personnel, emergency medical technicians, concierge, restroom assistants,
stagehands, box office personnel and other maintenance personnel, utilities and
insurance) necessary for the conduct of an Event.
1.36 Event(s) means all revenue or nonrevenue producing
sports, entertainment, cultural, civic and other activities and events which are
conducted at the Facility and scheduled by Operator.
1.37 Expiration Date means the date of expiration of the
Agreement, which is thirty (30) years after the Operations Start Date, as
extended by any Abatement Period (or portion thereof) having a duration of at
least ninety (90) days and further extended by any Extension Term.
1.38 Facility means the Project Site, the Arena, and the
Parking Areas with all improvements, additions, facilities, fixtures, furniture,
machinery and equipment, attachments and appurtenances now or hereafter
attaching thereto.
1.39 Facility Advertising Agreement shall mean that certain
agreement to be entered into between Operator and Team pursuant to Section 7.1
of the License Agreement.
1.40 Facility Operating Expenses shall mean and include all
expenses or obligations of whatever kind or nature made or incurred by the
Operator or its designee or the Arena Management Firm, within the scope of
Operator's authority or responsibility under this Agreement, including, but not
limited to, Operator's expenses; Impositions; Tourism Promotion Payments;
payments of fees, costs, interest and principal on or with respect to Working
Capital Loans; payments to the Operating Reserve Account; payments to the
Renewal and Replacement Account; all expenses incurred to obtain Facility
Operating Revenues; salaries, wages and benefits of personnel working at the
Facility including personnel employed by Operator; human resource support
services and training and development expenses; contract labor expenses;
maintenance and repairs; utilities; deposits for utilities; telephone expenses;
expenses incurred under use or license agreements with licensees or other users
at the Facility; telescreen, video and/or scoreboard operation expenses; dues,
memberships and subscriptions; security expenses; Management Fees; audit fees;
legal fees; other professional fees; fees payable to Concessionaires or other
subcontractors; refuse removal expenses; cleaning expenses; sales taxes;
building supplies; ticket commissions; insurance premiums; data processing
expenses; advertising; marketing; public relations expenses; expenses and losses
incurred in the production and promotion of Events at the Facility where
Operator acts as promoter or co-promoter; pest control; travel, lodging and
related out-of-pocket expenses and Facility related entertainment expenses;
office supplies; employment fees; freight and delivery expenses; expenses
6
for leasing of equipment; Master Card, VISA and other credit and debit
facilities and telecheck fees and expenses; travel, lodging and related
out-of-pocket expenses for officers and directors of Operator properly
allocable to the performance of Operator's obligations under this Agreement
including, but not limited to, promotion of the Facility, local, regional and
national conferences, arena management seminars, crowd management seminars, and
schools of public facility management such as Oglebay; all damages, losses or
expenses suffered or paid by Operator as the result of any and all claims,
demands, suits, causes of action, proceedings, judgments and liabilities,
including reasonable attorneys fees incurred in litigation or otherwise,
assessed, incurred or sustained by or against any of them.
1.41 Facility Operating Revenues shall mean all revenues as
determined on an accrual basis including, without limitation, revenues from the
sale and/or licensing of Premium Seating (including deposits), revenues derived
from the sale or licensing of personal seat licenses (including deposits),
revenues from the sale of name sponsorship (including Naming Rights),
Advertising Revenues, box office revenues, parking revenues, revenues from the
sale of Consumable and Non-Consumable Concessions, sponsorship revenues, rent
and other fees under the License Agreement, all other licensing and use fee
revenues, interest income (except interest earned on funds deposited in the
Renewal and Replacement Account), forfeited security deposits, ticket
convenience fees, equipment rental fees and Seat Use Charges, earned by the
Operator (1) for the use of, operation, or admission to, the Facility or any
portion thereof, (2) for the right to sell, or in respect of the sale of, any
product or advertisement in the Facility including all rents, royalties, and
concessions from tenants, Concessionaires, and Licensees, (3) from interest on
or proceeds of investment of any Accounts (except the Renewal and Replacement
Account) required to be maintained hereunder, (4) for rental or use of the
Facility equipment, or (5) as fees for services rendered at the Facility; but
excluding, in all events, (i) sums received or collected by the Operator for and
on behalf of and actually paid to a user of the Facility, (ii) any revenues
reserved to the Team pursuant to the License Agreement and (iii) any Revenue
Advances pursuant to Section 5.10.
1.42 Facility Rights shall meany any rights, the sale of
which would give rise to Facility Operating Revenue but for the treatment of
such as Revenue Advances pursuant to Section 5.10.
1.43 Fiscal Year means a twelve (12) month period commencing
October 1 and ending on September 30 of the immediately following year, or any
portion thereof.
1.44 Fixed and Permanent Advertising means all Advertising
other than Temporary Advertising.
1.45 General Manager means the chief operations officer of
the Operator or Arena Management Firm, his designee or successor, in every case
designated in writing by the Operator to the County.
1.46 General Seating means all of the other seats at the
Facility that are not Premium Seating including but not limited to
rinkside/court side seating or any other type of preferred location
7
seating which is not Premium Seating. The Team will sell "General Seating" for
its own account at the prices that Team determines and may include such other
benefits for Hockey Ticket purchasers as Team may determine, including, without
limitation, membership in the "Panthers Club" or some other club memberships of
Team sponsors, season ticket holders or others. The provision of a club
membership or other benefits to a Ticket purchaser does not change seating
designated as General Seating to Premium Seating.
1.47 Impositions means all governmental assessments,
franchise fees, excises, license and permit fees, levies, charges and taxes,
general and special, ordinary and extraordinary, of every kind and nature
whatsoever (irrespective of the nature thereof, including, without limitation,
all such charges based on the fact of a transaction, irrespective of how
measured) which at any time during the Term hereof may be assessed, levied,
confirmed, imposed upon, or grow or become due and payable out of or in respect
of, or become a lien on: (a) all or any part of the Facility; (b) 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; or (c) this transaction or any document to which the Operator
or the Team is a party which creates or transfers rights with respect to all or
any part of the Facility.
1.48 Incremental County Preferred Revenue Allocation has the
meaning set forth in Section 8.2
1.49 License Agreement means that certain License Agreement
entered into between the Operator, County and the Team, dated the date hereof,
as same may be amended or restated.
1.50 License Commencement Date has the meaning set forth in
the License Agreement.
1.51 Licensee means any licensee other than the Team,
including licensees of concessions, Premium Seating, Advertising, arena
restaurant, and other users of privileges in or around the Arena for a fee.
1.52 Licenses means Premium Seating Licenses, licenses with
Concessionaires, licenses with other users of the Facility and all booking and
use agreements as described herein.
1.53 Liens means all encumbrances, liens, security interests,
pledges and claims in, to, against or in any way applicable to any portion of
the Facility or the Accounts.
1.54 Management Fees means the Base Management Fee and
incentive fees, if any, paid to Operator for its services under this Agreement,
as set forth under Sections 4.14 and 4.15 herein.
1.55 Management Services means the services which the
Operator or its designee is required to render in connection with the management
of the Facility pursuant to this Agreement.
1.56 NHL means the National Hockey League.
8
1.57 NBA means the National Basketball Association.
1.58 Net Operating Income means, as to each Fiscal Year
during the Term, the net of Facility Operating Revenue for such Fiscal Year less
Facility Operating Expenses for such Fiscal Year and less the County Preferred
Revenue Allocation distributed by Operator pursuant to Section 5.2 for such
Fiscal Year.
1.59 Non-Commercial Event has the meaning set forth in
Section 15.1.8.
1.60 Non-Consumable Concessions means all Concessions items
other than Consumable Concessions.
1.61 Operating Fund means the account which shall be
established for the deposit of all Facility Operating Revenue and from which all
Facility Operating Expenses required by this Agreement shall be paid and from
which Net Operating Income and other distributions shall be made. Operator may
establish the Operating Fund in a bank or other financial institution located in
Broward County. Operator may deposit, invest or otherwise employ the funds in
the Operating Fund provided that such funds will be available as necessary to
pay Facility Operating Expenses as and when they become due.
1.62 Operating Reserve Account means the Account maintained
by Operator as a contingency reserve for three (3) months of Facility Operating
Expenses.
1.63 Operating Reserve Contribution means the deposit by
Operator into the Operating Reserve Account of amounts sufficient to enable a
build-up and maintenance of three (3) months of budgeted Facility Operating
Expenses.
1.64 Operations Start Date means the earlier of (a) the date
of issuance of a final and unconditional Certificate of Occupancy for the entire
Facility, or (b) if requested by the Operator, the date of issuance of any
temporary Certificate of Occupancy permitting any Event to be conducted.
1.65 Operator means Arena Operating Company, Ltd., a Florida
limited partnership, its successors and assigns.
1.66 Operator Representative is the person authorized to
issue and receive notices on behalf of Operator with respect to this Agreement
and shall be the General Manager and shall have the rights, duties and
responsibilities set forth in Section 2.5.
1.67 Panthers means the Florida Panthers Hockey Club, Ltd., a
member club of the National Hockey League. "Panthers" is used interchangeably
with "Team".
9
1.68 Parking Areas means the areas of the Facility designated
for parking.
1.69 Person means any Affiliate, individual, trust, estate,
partnership, joint venture, company, corporation, association, or any other
legal entity or business or enterprise.
1.70 Premium Rate means a rate of interest equal to two
percent (2%) in excess of the Prime Rate.
1.71 Premium Seating means the executive suites, party suites
and co-op suite seats at the Facility designated by Team which have exclusive
access for its patrons on a separate and exclusive concourse and is or may be
serviced by separate catering, service and maintenance support. Premium Seating
shall not include any of the General Seating.
1.72 Premium Seating License means the form of that certain
Agreement for execution by Premium Seat Licensees as amended from time to time
and all such executed forms of the agreement as are executed and in effect from
time to time.
1.73 Prime Rate means the rate of interest announced from
time to time by NationsBank of South Florida, N.A., or by any other bank located
in the County and designated by the Operator and the County, as the "prime rate"
of interest.
1.74 Project Site means the entire tract of land on which the
Facility is located as set forth in the Development Agreement.
1.75 Public Entity Assignee means an entity which has, or is
intended to have, a class of capital stock registered under the Securities Act
of 1933, as amended, and that owns or is intended to own the Operator or
Operator's material assets.
1.76 Quality Arena Standard shall have the meaning given such
term in the License Agreement.
1.77 Records means all the books, records and accounts of the
Facility that the County is permitted to inspect and audit pursuant to this
Agreement.
1.78 Related Agreements means this Agreement, the Development
Agreement and the License Agreement.
1.79 Renewal and Replacement Account means the Account
established for funds deposited pursuant to Section 5.6.1 and 5.6.2 which may be
used as specified in Section 5.6.3.
1.80 Renewal and Replacement Account Payments means payments
into the Renewal and Replacement Account in the manner and amounts established
in Section 5.2.5.
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1.81 Renewal and Replacement Contribution means the annual
contributions to be deposited by Operator into the Renewal and Replacement
Account in amounts as set forth below, such amounts to be prorated in any
partial Fiscal Year:
[Enlarge/Download Table]
Year
----
2 $338,000
3 $349,000
4 $362,000
5 $752,000
6 Prior Year, plus the lesser of the percentage change in the Consumer Price Index in the
preceding Fiscal Year or three percent (3%) (such amount to be increased in the event of an
increase on the Consumer Price Index and held constant from the previous year in the event of a
decrease in the Consumer Price Index).
1.82 Revenue Advances shall have the meaning set forth in
Section 5.10.
1.83 Request with respect to this Agreement has the meaning
set forth in Article XVII thereof.
1.84 Seat Use Charge means the amount that (i) the user of
each seat in the Arena shall be charged for use of such seat and (ii) Operator
shall collect from each such user. Such amount shall be determined by Operator
in its discretion. The Seat Use Charge shall be in addition to, and not in lieu
of admission charges and any taxes that may be payable on such Seat Use Charge.
The Seat Use Charge shall be Facility Operating Revenue and shall be deposited
by Operator in the Renewal and Replacement Account and specifically segregated
for use for capital improvements at the Facility or to improve the roadways and
for traffic access improvements.
1.85 Sponsor Signs has the meaning set forth in the License
Agreement.
1.86 Sunrise Letter of Agreement shall mean that certain
Letter of Agreement by and among Team, County and the City of Sunrise, Florida.
1.87 Temporary Advertising means Advertising in connection
with any Event which is to be removed or terminated at the conclusion of such
Event.
1.88 Title Exceptions has the meaning set forth in Section
15.1.5.
1.89 Tourism Promotion Payment means $500,000 per year
payable within thirty (30) days after the end of each Fiscal Year, commencing
with the first Fiscal Year of the License Term, except that the payment
following the end of the first Fiscal Year shall be prorated for a partial
Fiscal Year. The Tourism Promotion Payment shall be a fixed amount and shall
not be adjusted for any increases or decreases in the Consumer Price Index or
otherwise.
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ARTICLE II
ENGAGEMENT OF OPERATOR
2.1 Engagement of Operator. The Operator or its designee
shall be the sole and exclusive manager and operator of the Facility during the
Term hereof with sole responsibility and full control and discretion in the
operation, direction, management and supervision of the Facility and its staff,
subject to and as more fully described in this Agreement. Operator shall have
the right to delegate all or a portion of its duties and responsibilities
hereunder to Arena Management Firm and/or to subcontractors or agents including
to Operator's Affiliates.
2.2 Authority of Operator. The Operator shall have the
exclusive right and authority to exercise, or delegate the exercise of, all
rights, powers and duties conferred or imposed on the Operator in this
Agreement. The powers of the Operator with respect to the Facility shall be
plenary, subject only to the limitations expressly set forth in this Agreement.
2.3 Duty and Liability. The Operator shall owe to County a
duty to perform its obligations under this Agreement and to conduct the
management and operation of the Facility at all times with integrity and good
faith in a manner which is in the best interests of the County, the Facility and
its tenants, users and licensees, including the Team, and consistent with the
terms of this Agreement.
2.4 County Representative. The County Administrator shall
be the County's authorized representative who shall act as liaison and contact
person between the County and Operator in administering and implementing the
terms of this Agreement. County shall have the right to designate a substitute
authorized representative by providing written notice thereof to Operator. The
County Representative, or his authorized designee, shall respond to requests for
review, consents or waivers within five (5) business days after submittal, and
failing a written notice of disapproval within such time period, the request
shall be deemed approved or the consent granted. Notwithstanding the foregoing,
the Board shall be required to consent to any amendment to this Agreement or to
any other request for consent that is not related to administration of the terms
of this Agreement. All administrative and ministerial consents shall be given
by the County Representative on behalf of the County. In any situation
requiring Board approval, the County's failure to provide a written notice of
disapproval within thirty (30) days of submittal of any request, consent or
waiver by Operator or its designee, shall be deemed an approval or consent of
such request by County. The Operator and any other Person dealing with County
in connection with this Agreement or any matter governed by this Agreement may
rely and shall be fully protected in relying upon the authority of the County
Representative or any such designee to act for and bind County in any such
matter.
2.5 Operator Representative. The General Manager shall be
the Operator's authorized representative who shall act as liaison and contact
person between the County and Operator in all matters concerning this Agreement.
Operator shall have the right to designate a substitute authorized
12
representative by providing written notice thereof to County. The Operator
Representative, or his authorized designee, shall respond to requests for
review, consents or waivers within ten (10) days after submittal, and failing a
written notice of disapproval within such time period, the request shall be
deemed approved or the consent granted. The County and any other Person
dealing with Operator in connection with this Agreement or any matter governed
by this Agreement may rely and shall be fully protected in relying upon the
authority of the Operator Representative or any such designee to act for and
bind Operator in any such matter.
2.6 Operator Pre-Operations Start Date Duties. At any time
after the date hereof, the Operator shall have such rights and shall discharge
such duties as are reasonable and necessary to ensure that the Facility is
equipped, staffed and managed to commence operations upon the Operations State
Date and to sell or license Advertising, Naming Rights, Premium Seating, parking
or any other source of Facility Operating Revenues and, in connection therewith,
may make distributions from the Operating Fund in satisfaction of Facility
Operating Expenses or other amounts permitted hereunder. Operator will submit a
pre-opening plan to County detailing its pre-opening actions at least 24 months
prior to the Operations Start Date and shall update such plan at six month
intervals until the Operations Start Date. Except as specifically set forth in
this Section, Operator shall have no rights, duties or obligations to operate,
manage or perform other actions with respect to the Facility prior to the
Operations Start Date.
ARTICLE III
TERM
3.1 Commencement and Term. The term (the "Term") of this
Agreement shall commence on the date hereof and shall expire (the "Expiration
Date") on the anniversary date 30 years after the Operations Start Date;
provided, however, the Expiration Date shall be extended for a period equal to
the aggregate of every Abatement Period or portion thereof commencing after the
License Commencement Date and having a duration of at least 90 days and for the
period of any Extension Terms. Notwithstanding anything to the contrary it is
intended that the Expiration Date of this Agreement shall be simultaneous with
that of the License Agreement and therefore, unless sooner terminated herein,
this Agreement shall automatically terminate upon the expiration of the License
Agreement.
3.2 Options to Extend. Operator shall have the option and
right (each an "Extension Option") to extend the Term of this Agreement upon the
same terms and conditions, for two (2) additional terms (each an "Extension
Term") of five (5) years each commencing on the Expiration Date or the
conclusion of the then-expiring Extension Term of this Agreement. The Operator
shall exercise the Extension Options by delivering written notice to County not
less than six (6) nor more than eighteen (18) months prior to the Expiration
Date or the expiration of the then-expiring Extension Term.
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ARTICLE IV
OPERATOR'S RIGHTS AND OBLIGATIONS
4.1 Management. Operator shall be the exclusive manager and
operator of the Facility and, except as provided in Section 4.2, shall have the
exclusive right to contract for its license or use during the Term and any
Extension Term in a manner that will promote and further the purposes for which
the Facility and the Arena has been constructed. The Operator shall do all
things and take all actions necessary for the operation of the Facility in
accordance with this Agreement. In performing its duties and responsibilities
hereunder, Operator shall exercise such attention and care as is reasonably
consistent with the Quality Arena Standard. Without limiting the generality of
the foregoing, the Operator is authorized to and shall:
4.1.1 collect all Facility Operating Revenue and
County Event Revenue and in connection
therewith, use all reasonable efforts to
obtain all fees, rents and other amounts due
from Licensees, Concessionaires and other
users of the Facility; and shall cause notices
to be served upon such Licensees and other
users to quit and surrender space occupied or
used by them where desirable or necessary in
the opinion of the Operator; and shall ask
for, demand, collect and give receipts for all
amounts which at any time may be due from any
Licensees and other users of the Facility;
4.1.2 prepare and submit to the County (for its
review and comment but not approval) on or
before August 1 of each Fiscal Year an Annual
Budget projecting the estimated revenues and
expenses of the Facility during the next
Fiscal Year and a Renewal and Replacement
Account budget projecting the estimated
Additions and Capital Repairs expenditures
for the Facility during the next Fiscal Year,
and maintain and furnish all other financial
records and information required herein;
4.1.3 commence, defend and settle in good faith
such legal actions or proceedings concerning
the operation of the Facility (other than
defense of the County in legal actions or
proceedings in which the County is a
defendant, which defense shall be assumed by
the County Attorney) as are necessary or
required in the opinion of the Operator and
shall retain counsel in connection therewith;
4.1.4 employ, pay and supervise all personnel that
the Operator determines to be necessary for
the operation of the Facility, including such
personnel as shall be necessary to maintain
and ensure public order and safety in and
around the Facility (such personnel, during
the course of such employment, shall be
employees of the Operator and shall not be
employees of the County); determine all
matters with regard to such personnel,
including, without
14
limitation, compensation, bonuses, fringe
benefits, hiring and replacement and may at
its option establish reasonable employee
benefit plans and training and motivational
programs similar to those at other NHL arenas
that meet or exceed the Quality Arena
Standard; and shall prepare, on its own behalf
and file when due, all forms, reports and
returns required by law relating to the
employment of such personnel;
4.1.5 purchase and maintain all materials, tools,
machinery, equipment and supplies necessary
for the operation of the Facility;
4.1.6 maintain the Facility in accordance with the
Quality Arena Standard, subject to normal
wear and tear, and maintain and operate the
Facility in compliance with all NHL
requirements in effect from time to time and,
to the extent available, utilizing the
Renewal and Replacement Account;
4.1.7 coordinate and administer a preventative
maintenance program for the Facility, its
machinery and equipment;
4.1.8 arrange for all utility and other services
for the Facility and pay or cause to be paid
when due all charges for water, sewer, gas,
light, heat, telephone, electricity and other
utilities and services rendered to or used on
or about the Facility;
4.1.9 maintain or cause to be maintained all
necessary licenses, permits and
authorizations for the operation of the
Facility;
4.1.10 furnish to the County such reports and other
information concerning the Facility and
operation thereof as may be reasonably
requested from time to time by the County.
4.1.11 procure and negotiate contracts with
Concessionaire(s) for the operation of
Consumable and/or Non-Consumable Concessions
at the Facility (unless Operator shall
self-operate such Concessions); in this
regard Operator shall advise County of the
status of such negotiations and permit County
to review and comment upon any such contract
and Operator, in its discretion and after
consultation with the County, shall conclude
such contracts and upon execution of any
Concession agreement, Operator shall deliver
a copy to County.
4.1.12 control the issuance of and issue all
credentials for Events at the Facility.
4.1.13 pay to County, in the event of a default
under the Guaranty Agreement, the amounts
pledged thereunder.
15
4.2 Use Agreements. Operator shall have the exclusive
right to negotiate, execute and perform use agreements, licenses and other
agreements: (i) with Persons who desire to schedule events, performances,
telecasts, broadcasts or other transmissions in, from or to the Facility, or
any part thereof or who desire otherwise to license the use of or to occupy the
Facility or any part thereof; or (ii) that otherwise pertain to the use,
operation and occupancy of the Facility or any part thereof. Notwithstanding
the above, in the event an NBA team wishes to become a licensee or tenant of
the Facility then the County shall be a party to all such negotiations and
shall be the party granting such license or lease to the NBA team. However,
Operator and County acknowledge that the lease or license for such NBA team
need not be on the same economic terms as the Team has under the License
Agreement and that Team shall continue to enjoy all of its benefits thereunder
as "primary tenant", including but not limited to its Hockey Event scheduling
priority, its exclusive right to possess the Team Areas and its rights
concerning Concessions, marketing, Advertising under the Facility Advertising
Agreement and parking.
4.3 Promotions Contracts.
4.3.1 Operator shall have the exclusive control over
the negotiation, execution, and delivery of
contracts with promoters, users and other
Persons of the Facility. In so doing,
Operator shall negotiate for rental rates
consistent with industry standards and with
the goal of maximizing use of the Facility and
the generation of revenues therefrom, subject
to Operator's right to contract with County
for County Events and for certain civic and
cultural activities. County recognizes,
however, that collection of rental rates is in
part dependent upon the success of a
promotion, and that subsequent usage of the
rates is in part dependent upon flexibility in
collection of negotiated rental rates when a
prior promotion with the same promoter has
failed to meet expectations. Accordingly,
Operator shall have the right to forgo
collection of all or part of pre-negotiated
rental rates when, in Operator's good faith
judgment, (a) the promotion has operated at a
significant loss to the promoter, or (b) the
promoter has historically utilized the
Facility in a financially successful manner,
or (c) the promoter is likely to be a user of
the Facility for subsequent promotions, or (d)
in Operator's judgment such concessions are in
the best interests of the Facility. If the
promoter is controlled by, under common
control with or controls Operator, Operator
may grant such concessions only with the
approval of County.
4.3.2 Operator shall have the right to negotiate and
enter into agreement with users of the
Facility whereby Operator and such user
co-promote an Event at the Facility. Each of
these co-promotion contracts shall
specifically set forth the arrangement between
the Facility and the co-promoter in respect to
sharing of revenues and expenses attributable
to user's use of the Facility in connection
with the Event.
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4.4 Marketing and Public Relations. In cooperation
with the Team, the Operator shall plan, prepare, implement, coordinate and
supervise all public relations and other promotional programs for the Facility
and shall negotiate, execute (in its own name and not in the name of the
County) and perform all contracts for Facility promotions. The Operator shall
attempt to coordinate event marketing and planning with the management of the
Broward County Convention Center and the Broward County Performing Arts Center
in order to minimize, to the extent possible, conflicting dates and events. In
no event shall Operator be required to cancel or reschedule an Event unless it
determines that such cancellation or rescheduling is in the best interests of
the Facility in furtherance of Facility Operating Revenue.
4.5 Advertising. Operator shall have the exclusive right to
post, exhibit or display any Advertising at the Facility. The Operator shall
have the responsibility for and shall be the exclusive agent for the sale and
marketing of all Fixed and Permanent Advertising in the Facility and all
Temporary Advertising for Events sponsored by Operator (other than Sponsor Signs
displayed or exhibited by the Team, which shall be reserved to the Team). The
Facility Advertising Agreement shall be entered into by the Operator with the
Team which agreement sets forth the mutual duties and obligations to sell or
license advertising at the Facility. In addition, Operator shall enter into
marketing and advertising agreements with third parties, setting forth the
consideration for, the manner and the method of such advertising and marketing
arrangements. Operator shall have the right to negotiate, execute and perform
any and all contracts, use agreements, licenses and other agreements: (i) for
the use of Advertising space within the Facility or any part thereof and all
advertising rights of whatever kind or nature related thereto (except for
Sponsor Signs and other rights granted to Team under the License Agreement); or
(ii) for the sale, promotion, marketing and use of all names, trademarks,
tradenames, logos and similar intangible property relating to the Facility or
any part thereof. All revenues derived from Advertising rights or licenses, the
sale, promotion and use of all names, trademarks, tradenames, logos and similar
intellectual property rights related to Advertising in the Facility or on the
Project Site (other than revenue from Sponsor Signs and other Advertising
reserved for Team) ("Advertising Revenue") shall be deemed Facility Operating
Revenue and shall be turned over to or collected by the Operator for deposit
into the Operating Fund.
4.6 Naming Rights. The Operator shall have the exclusive
right to sell, license or otherwise grant the naming rights to some or all of
the Facility including Facility concourses, the rink or any part of the
Facility, subject to NHL regulations, on such commercially viable terms and
conditions as Operator shall determine (the "Naming Rights"). The County
reserves the right to disapprove and thus prohibit any name for the Facility
(but not for the concourses or any part of the Facility) that the Board
reasonably deems in bad taste or offensive to the County's image, or in the
reasonable opinion of the Board is a source of embarrassment to the South
Florida community. Notwithstanding the foregoing, the name of any Fortune 1000
company (with the exception of any tobacco or alcoholic beverage company) shall
be deemed a County approved name for purposes of this Section 4.6 and, in
addition, any bank, airline, sporting goods or apparel or soft drink company,
shall be deemed a County approved name. If Operator wishes to sell or license
the Naming Rights
17
to a tobacco or alcoholic beverage company, then Operator may propose such
company to County for its approval. The consideration to be received in
connection with the sale, license or grant of Naming Rights may include barter
or trade consideration, up to a maximum of twenty percent (20%) of the
aggregate value of Naming Rights consideration. However, under no circumstance
shall such use of barter reduce the revenue recognition by the Operator to the
Project except to the extent attributable to Team Revenues earned in connection
with such barter transaction. Other than certain barter consideration reserved
for Team under the License Agreement, all other revenue and barter
consideration, whether by sale, lease, license or otherwise, derived from the
grant of Naming Rights to the Facility or any part thereof, that accrues either
prior to or following the Operations Start Date shall be Facility Operating
Revenue. All revenue in respect of Naming Rights received by Operator prior to
the Operations Start Date shall be deposited in the Operating Fund. All
expenses incurred in the marketing or sale of Naming Rights for the Facility, or
any part thereof, shall be Facility Operating Expenses.
4.7 Concessions. Subject to the terms of the License
Agreement, the Operator or its designee shall have sole control and
responsibility and shall have the sole right to operate and/or contract for the
operation of Concessions (both fixed and portable) and catering operations at
the Facility for the sale of Consumable and Non-Consumable Concessions.
4.8 Booking. The Operator shall have the duty and sole
right to (a) arrange for and otherwise book Events in the Facility (subject to
the priority for Hockey Events described in the License Agreement). Operator
shall develop and maintain a scheduling system for Events, including County
Events, at the Facility.
4.9 Ticketing. Subject to the rights of the Team to control
ticketing for Hockey Events under the License Agreement, Operator shall control
and coordinate all ticketing for Events at the Facility and the Arena.
4.10 Affiliate Contracts. The Operator shall have the right
to enter into contracts or transact business with Affiliates without consent of
the County to the extent such contract is on commercially reasonably terms and
negotiated on an arms length basis. The Operator shall be obligated to provide
a copy of any such contract to the County if such Affiliate contract provides
for the purchase of goods and services by Operator with a value greater than
Sixty Thousand Dollars ($60,000) in any Fiscal Year.
4.11 Administration. Operator shall have the right to plan,
coordinate and administer the operation of the Facility and the Arena, including
the coordination of the efforts and all parties involved in Facility operations,
establishing and maintaining procedures for payment of Facility Operating
Expenses, receipt of Facility Operating Revenues, preparation of budgets and
related materials, development and implementation of accounting policies for the
Facility, coordination of the work of any party performing services at the
Facility, monitoring actual and projected costs of operations, furnishing
services, personnel, materials, tools, machinery, equipment and other items
necessary to operate the Facility.
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4.12 Changes in Parking Area Configuration. Provided that
such changes do not violate conditions of permits or a Development of Regional
Impact Order affecting the Project Site or the Facility (or require the
approvals of certain other parties under any such permits or Development of
Regional Impact Order), Operator may change the design, number or configuration
of parking spaces, including spaces allotted to Premium Seating patrons, VIPs,
employees and players, with the consent and participation of the Team, in order
to enhance the efficient operation of vehicle parking at the Facility.
4.13 Security and Traffic Control. The parties recognize the
obligations of the City pursuant to the Sunrise Letter of Agreement. Both the
County and the Operator shall take all necessary action to realize the police,
security and on-Site and off-Site traffic control benefits that City has agreed
to provide pursuant to the Sunrise Letter of Agreement. Operator shall also
provide such traffic control and security as is reasonably necessary to direct
traffic to and from Events at the Facility. The City, County and the Operator
shall cooperate in good faith to develop a traffic management plan to facilitate
the ingress and egress of traffic to and from events at the Facility; provided,
however, that the parties are under no obligation under the preceding clause to
incur any costs in excess of costs otherwise required by this Agreement.
Pursuant to the Sunrise Letter of Agreement, the City has agreed to provide at
specified times, among other things, (i) police for traffic management, security
and escort services; (ii) a three-person paramedic unit, a hazardous materials
response unit, emergency transport from the Facility under certain circumstances
and CPR/First Aid training; and (iii) services for maintenance of public streets
within the Project Site, solid waste services, utilities and the right to use a
billboard.
4.14 Base Management Fee. Each year during the Term, the
Operator shall receive or pay to Arena Management Firm a Base Management Fee for
its services under this Agreement. The Base Management Fee shall be payable
from Facility Operating Revenue, in accordance with the terms of this Agreement.
4.15 Incentive Fee. To the extent that the Operator
designates a firm other than an Affiliate, then in addition to the Base
Management Fee, the Operator may be entitled to pay an incentive fee, which fee
shall be subject to negotiation, payable to such firm from Facility Operating
Revenue within 30 days after the completion and delivery of the annual Facility
audit.
4.16 Small Disadvantaged Business Enterprise Participation.
On or before the Operations Start Date, Operator shall submit to County a plan
in substantially the form attached hereto as Exhibit 4.16 setting forth its
goals with respect to Small Disadvantaged Business Enterprise Participation in
the operation of the Facility. Operator agrees to cooperate with County in
meeting participation goals in the operations of the Facility.
4.17 Personal Seat Licenses. Upon consent of the Team,
Operator shall have the right (either exclusively or in conjunction with Team)
to license some or all of the General Seating through the sale of Personal Seat
Licenses ("PSL's"). In the event the Operator or Team sells or
19
licenses PSL's prior to the Operations Start Date, Operator shall have the
option to use the proceeds collected prior to the Operations Start Date from
the sale thereof to redeem or prepay a portion of the Bonds (as described in
Section 5.9 but only to the extent permitted in the Plan of Finance attached as
Exhibit C to the Development Agreement) or to treat such revenues as Facility
Operating Revenues or to treat such revenues in accordance with provisions of
Section 5.10. Revenues from the sale or license of PSL's collected after the
Operations Start Date shall be treated as Facility Operating Revenues.
All expenses incurred by Operator in connection with the exercise of
any of its duties, rights or obligations under this Article IV shall be
included in Facility Operating Expenses.
ARTICLE V
FINANCIAL OBLIGATIONS
5.1 Facility Operating Revenue. The Operator shall use its
good faith best efforts to promptly and diligently collect Facility Operating
Revenue and, upon collection, shall deposit all Facility Operating Revenue into
the Operating Fund.
5.2 Distribution of Funds from Operating Fund. The Operator
shall distribute funds from the Operating Fund (subject to availability as
further described in Section 5.4) in the following order of priority, and at the
following times:
5.2.1 Operator shall reserve certain Facility
Operating Revenue so that it can make payments
of the County Preferred Revenue Allocation on
or before the debt service payment dates of
the Bonds. Such payments shall be made to
County within seven (7) days prior to the date
of any debt service payment on the Bonds.
County shall deliver to the Operator, within
thirty (30) days after issuance of the Bonds,
a schedule detailing the dates of such debt
service payments. Such payments shall be in
equal installments in accordance with the
annual debt service payments on the Bonds.
Making provision for the County Preferred
Revenue Allocation shall be first use of
Facility Operating Revenue.
5.2.2 Second, to the payment of Facility Operating
Expenses (except for the Management Fees)
payable by Operator in the ordinary course of
business, as and when they become due.
5.2.3 Third, in payment to the Team, within ninety
(90) days after the end of each Fiscal Year,
of any previously advanced yet unreimbursed
amount of the County Preferred Revenue
Allocation actually paid or advanced by the
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Team in that Fiscal Year pursuant to Team's
obligations under the Guaranty Agreement.
5.2.4 Fourth, in the payment of the Management Fees
payable to the Operator within ninety (90)
days after the end of each Fiscal Year,
except that the payment following the end of
the first Fiscal Year shall be prorated for a
partial Fiscal Year.
5.2.5 Fifth, in payment of the Renewal and
Replacement Contribution to the Renewal and
Replacement Account, payable annually within
ninety (90) days following the end of the
Fiscal Year commencing with the first Fiscal
Year of the License Term, except that the
payment following the end of the first Fiscal
Year shall be prorated for a partial Fiscal
Year.
5.2.6 Sixth, in payment of the Operating Reserve
Contribution to the Operating Reserve Account
(if required), payable annually within ninety
(90) days following the end of each Fiscal
Year commencing with the first Fiscal Year of
the License Term.
5.2.7 To the extent there are any remaining funds
in the Operating Fund, then to the payment of
the Net Operating Income as set forth in
Section 5.3.
5.3 Distribution of Net Operating Income and Other Funds.
Commencing on the date hereof and continuing through the remainder of the Term,
the following payments, distributions and allowances shall be made and the
following provisions shall be complied with:
5.3.1 Within thirty (30) days after the end of each
operating quarter (starting with the second
quarter after the commencement of the Term),
and to the extent cash available in the
Operating Fund exceeds the projected cash
requirements reasonably anticipated by
Operator for the following quarter, Operator
shall cause any Net Operating Income and other
funds remaining in the Operating Fund received
during such operating quarter to be
distributed as follows:
(i) First, to the extent of the first
$14,000,000 of Net Operating Income earned during such Fiscal
Year (if any) or other funds remaining in the Operating Fund,
Operator shall pay Team 100% of such Net Operating Income or
other funds remaining in the Operating Fund;
(ii) Second, to the extent that Net Operating
Income or other funds remaining in the Operating Fund exceeds
$14,000,000 during such Fiscal Year (if any), Operator shall
pay Team eighty percent (80%) and County twenty percent
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(20%) of such Net Operating Income or other funds remaining
in the Operating Fund.
5.3.2 Within ninety (90) days after the end of each
Fiscal Year, Operator shall reconcile Net
Operating Income with the cumulative
distributions made pursuant to this Section
5.3 and if Net Operating Income for such
Fiscal Year is greater than the cumulative
distributions made to Team (and County, if
applicable) (without regard to Revenue
Advances made pursuant to Section 5.10)
Operator shall distribute the remainder of
such (i) amounts to Team (and County, if
applicable), in accordance with this Section
5.3; (ii) if Net Operating Income for such
Fiscal Year is less than the cumulative
distributions made to Team (and County, if
applicable), Team (and County, if applicable),
shall reimburse Operator for the respective
amounts received in excess of their shares of
Net Operating Income within thirty (30) days
upon notification from Operator.
5.4 Availability of Funds in Operating Fund; Working Capital
Loans. The Operator shall have no obligation to distribute or pay any funds
described in Section 5.2 in excess of the funds in the Operating Fund at the
time payment is required in Section 5.2 above; except that Operator shall make
reasonable effort to pay Facility Operating Expenses as they become due in the
ordinary course of business. In the event that the Operating Fund does not
contain sufficient funds to pay any such Facility Operating Expenses, Operator
(i) shall pay the Facility Operating Expenses from the Operating Reserve
Account, to the extent of the funds therein or if Facility Operating Expenses
remain due after depletion of the Operating Reserve Account, (ii) may, but
shall have no obligation to, pay such Facility Operating Expenses from proceeds
of loans to fund Facility Operating Expenses ("Working Capital Loans").
Operator may make such financing arrangements to ensure the availability of
Working Capital Loans as it deems necessary or reasonable to fund Facility
Operating Expenses; however any such Working Capital Loans shall be on
commercially reasonable terms, shall provide for level maturity not in excess
of three (3) years, and shall not require the pledge of Facility Operating
Revenue as security therefor (except that Operator may pledge Facility
Operating Revenues to the extent that such revenues are to be distributed for
the payment of Working Capital Loans (as part of Facility Operating Expenses)
pursuant to Section 5.2). Notwithstanding anything to the contrary, Operator
shall have no obligation to make any financing arrangements for or otherwise
provide for Working Capital Loans. All expenses incurred by Operator in
obtaining Working Capital Loans, including loan fees, costs and interest
expenses and all expenditures made to repay such loans, shall be deemed
Facility Operating Expenses.
5.5 Distribution of Funds from Operating Fund and Renewal and
Replacement Account during Abatement Periods. During an Abatement Period, (a)
the Operator shall only be required to make distributions from the Operating
Fund to the extent of available cash proceeds and in the order set forth in
Section 5.2, and (b) the Operator shall distribute funds from the Renewal and
Replacement Account, subject to availability, only to make Additions and Capital
Repairs and to repair and/or reconstruct the Facility in accordance with
Articles VIII, XII and XIII.
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5.6 Renewal and Replacement Account.
5.6.1 Establishment of Account; Payments. The
Operator shall establish a Renewal and
Replacement Account and shall make deposits to
such account in the amount of the Renewal and
Replacement Contribution in accordance with
Section 5.2.
5.6.2 Fund Investment. All payments by the
Operator pursuant to 5.6.1 shall be deposited
in a bank located in Broward County approved
by the County and the Operator. Funds in
such account shall bear interest in amounts
authorized by law and all interest earned
thereon shall accrue to the benefit of such
Account and shall not be included in Facility
Operating Revenue.
5.6.3 Use of Renewal and Replacement Account. The
Renewal and Replacement Account shall be used
for Additions and Capital Repairs in
accordance with Article VIII and for the
purposes described in Articles XII and XIII.
5.7 Operating Reserve Account. The Operator shall also establish
and make payments to the Operating Reserve Account and shall make deposits to
such account in the amount of the Operating Reserve Contribution in accordance
with Section 5.2. This Account shall be maintained by the Operator, in a bank
located in Broward County approved by the County and the Operator. Withdrawals
from the Operating Reserve Account shall be solely those authorized by the
Operator.
5.8 Distribution of Funds from Accounts Upon End of Term. Except
as otherwise specifically set forth herein, upon termination of this Agreement,
all funds remaining in the Accounts shall be distributed as follows:
(1) Renewal and Replacement Account Funds: Any funds
remaining in the Renewal and Replacement Account
shall be distributed first to reduce debt service
on the Bonds and to the extent remaining shall be
distributed as if such funds were Facility
Operating Revenues.
(2) Operating Reserve Account: Any funds remaining in
the Operating Reserve Account shall be distributed
as if such funds were Facility Operating Revenues.
(3) Operating Fund: Any funds remaining as Net
Operating Income in the Operating Fund shall be
distributed in accordance with Section 5.2 and
shall be paid without making any other payments
required thereunder except for the payment of
liabilities incurred for Facility Operating
Expenses and Working Capital Loans.
23
5.9 Reduction of County Preferred Revenue Allocation. In
the event (i) Operator or Team determines, pursuant to Section 4.17, to use the
cash proceeds received from the sale of PSL's prior to the Operations Start Date
to prepay or redeem a portion of the Bonds; (ii) Project Developer develops the
Project for an amount less than the amount set forth in the Land Acquisition and
Project Development Budget and such amount is not used to make additional
improvements to the Project or (iii) Operator sells the rights to conduct
Concessions at the Facility to a third party and the Operator, Team and the
County mutually determine to use the proceeds of such sale to redeem or prepay a
portion of the Bonds (to the extent permitted in the Plan of Finance attached as
Exhibit C to the Development Agreement), then, in any of such events, the County
Preferred Revenue Allocation shall be reduced each year during the Term by an
amount equal to the amount that the collective amount of the foregoing
prepayments or redemptions serves to reduce the yearly debt service payments on
the Bonds (the "County Preferred Revenue Allocation Reduction"). Nothing
contained herein shall limit Operator's ability to elect to treat any of the
foregoing proceeds as provided in Section 5.10.
5.10 Advances. Notwithstanding any provision of this
Agreement, the Operator shall have the right at semi-annual intervals (at least
two (2) business days following any debt service payment date on the Bonds)
during each Fiscal Year, to make advances and distributions ("Revenue Advances")
of any proceeds (whether current, prepaid, or deferred revenues) from the sale,
exchange, pledge, use, or grant of licenses of any Facility Rights including but
not limited to Naming Rights, PSL's, Premium Seating, concessionaire grants, or
any cash proceeds (when considered along with projected Facility Operating
Revenues received or anticipated to be received in excess of current year
Facility Operating Expenses) to the Team and County (if applicable) as provided
herein. Revenue Advances, if any, made to the Team or County pursuant to this
Section 5.10 shall be distributed in by the Operator eighty percent (80%) to the
Team and twenty percent (20%) to the County.
ARTICLE VI
OWNERSHIP AND USE
6.1 County Ownership. The Facility and the Project Site
have been or are being acquired by the County with funds being made available by
the County, and, together with other portions of the Facility and support
facilities (including Parking Areas) are or shall be owned by the County. County
shall maintain the Project Site and the Facility free and clear of any
Impositions during the Term and any Extension Term.
6.2 County Use. The County reserves the exclusive,
non-assignable right to use the Facility for up to 15 County Events in each
Fiscal Year (which shall be prorated in any partial Fiscal Year), subject to
priority scheduling of all other Events. Any dates not used by County for
County Events within the Fiscal Year shall terminate and shall not accrue for
use during successive Fiscal Years. All revenue derived in connection with
County Events from parking, Consumable and Non-
24
Consumable Concessions and permitted Temporary Advertising shall be included in
Facility Operating Revenue. Ticket and any other revenue including revenue from
Temporary Advertising (that is exclusively sold for the County Event) derived
from County Events ("County Event Revenue") shall not be included in Facility
Operating Revenue and may be collected by Operator and distributed to County
upon County's payment to Operator of Event Related Expenses incurred in
connection with a County Event. The Operator shall be reimbursed from County
funds (or Operator shall have the right to set-off against any revenues in its
possession generated in connection with a County Event) for the Event Related
Expenses incurred in connection with a County Event on the date of the Event or
as specified in any applicable use agreement between the Operator and the County
Event sponsor but in no event later than 10 days following the Event. It is
understood that in its sales of permitted Temporary Advertising for County
Events, the County shall give any exclusive advertiser at the Facility the right
of first refusal to purchase any such Temporary Advertising. The County shall
maintain such insurance for County Events as provided in Section 11.8.
6.3 County Access. The County, through appropriate
designees, which may change from time to time, reserves the right to enter the
Facility during regular business hours solely to conduct fire, safety and health
inspections or to exercise County's normal police powers provided (a) the County
shall not interfere with the operations of the Facility (b) the County shall not
disturb the license or concession rights of others except in compliance with the
terms of any such concession or license and (c) the County's inspection rights
shall not be deemed to limit in any way Operator's rights to contest the
County's findings with respect to such inspections or the exercise of such
police powers. Additionally the County may enter the Facility in the case of an
Emergency to the extent necessary to make Additions and Capital Repairs in
accordance with Section 8.4.
ARTICLE VII
RECORDS AND AUDITS
7.1 Records. For a period of 3 years after the end of the
Fiscal Year to which they pertain, the Operator shall keep and maintain complete
and accurate Records for the Facility and for the Operator separate and
identifiable from its other records. The County (including accountants and
attorneys designated by the County) shall be entitled to inspect the Records
during the Term of this Agreement and five years thereafter (at the Operator's
office, upon not less than 48 hours' notice, and at all reasonable times).
7.2 Accounting Procedures. It is the intention of the
parties to eliminate distortions in the stream of Net Operating Income, so that
the exercise of discretion in the timing of receipts and expenditures from year
to year is minimized. Accordingly, the accounting system of the Operator shall
always be maintained in accordance with generally accepted accounting
principles, on an accrual basis, consistently applied.
25
7.3 Financial Reports.
7.3.1 Audited Reports. Operator shall cause to be
prepared financial reports with such
information and at such times as required by
this Section 7.3. Each financial report shall
be prepared in accordance with generally
accepted accounting principles. Operator's
independent certified public accountant
(selected from nationally recognized "big six"
public accounting firms) shall be determined
by Operator and be reasonably acceptable to
Team and County. Operator may terminate its
independent certified public accountant and
appoint a replacement independent certified
public accountant upon the concurrence of Team
and if reasonably acceptable to County.
7.3.2 Financial Reports. The Operator shall furnish
to County and Team the following financial
statements:
(a) As soon as practicable and in any
event by the twentieth (20th) day of
each calendar month during the
Fiscal Year, a statement setting
forth the prior month's Facility
Operating Revenue and Facility
Operating Expenses, expenditures for
Additions and Capital Repairs and
such other information as may be
reasonably requested by County or
Team.
(b) As soon as practicable and in any
event within forty-five (45) days
after the end of each of the first
three (3) quarters of each Fiscal
Year, a balance sheet of the Facility
as of the end of such quarter, and
statements of income and cash flows
of the Facility for the period
commencing at the end of the previous
Fiscal Year and ending with the end
of such quarter.
(c) As soon as practicable and in any
event within sixty (60) days after
the end of each Fiscal Year, a
balance sheet as of the end of such
Fiscal year, and a statement of
profit or loss and a statement of
changes of financial condition for
such Fiscal Year, prepared in
accordance with generally accepted
accounting principles and accompanied
by an auditor's report containing an
opinion of the independent certified
public accountant preparing the
report, which shall be a firm of
national reputation selected by
Operator.
7.4 Additional County Audits. At the option of the County,
in addition to the annual audit, the County may conduct an audit or examination
of the books, records, accounts and financial statements, or any part of such
Facility records of the Operator, at any time upon reasonable notice to the
Operator, any such examination or audit to be made solely at the cost of the
County. The
26
County acknowledges that certain Operator records or information relating to the
use, management or operation of the Facility examined or obtained hereunder, by
the County, are considered "Trade Secret Information" pursuant to F.S. 815.045
and that any such information is proprietary, and expressly made confidential
and exempt from the public records law. The County acknowledges and agrees that
disclosure of any such Trade Secret Information to another person would
negatively impact the business interests of the Operator and Team in the
marketplace. County further covenants and agrees that at all times during the
Term and any Extension Term, County shall (i) hold the Trade Secret Information
in confidence and refrain from disclosing the Trade Secret Information or
transmitting any Trade Secret Information to any other Person; (ii) use the
Trade Secret Information solely in connection with this Agreement and for no
other purpose; and (iii) take all precautions necessary to ensure that Trade
Secret Information shall not be, or be permitted to be, shown, copied or
disclosed to third parties, without the prior consent of Operator and Team. The
County further covenants and agrees to notify the Operator if County receives a
request for disclosure of any Trade Secret Information so that Operator may
vigorously defend any claims or disputes arising from efforts by others to cause
such Trade Secret Information to be disclosed as a public record. The County
further agrees to amend this Agreement as necessary to further protect Trade
Secret Information.
7.5 Underreporting of Facility Operating Revenue. In the
course of the preparation of the annual audited financial statements for the
Facility, in the event that Operator or its independent certified public
accountant determines that an underreporting of Facility Operating Revenue
occurred during the previous Fiscal Year in an amount in excess of 7.5% of the
Revenue sums due Facility from Team during the previous Fiscal Year, then in
such event Operator shall diligently pursue reconciliation of such discrepancy.
In such event, the Operator shall, promptly upon becoming aware of such
discrepancy, notify the County of such discrepancy.
ARTICLE VIII
ADDITIONS AND CAPITAL REPAIRS; EMERGENCY
8.1 Operator. The Operator shall have the right to make
Additions and Capital Repairs to the Facility if (a) necessary to comply with
governmental requirements; (b) requisite for the safe operation of the Facility
or its maintenance or repair; (c) required by any agreement approved by the
County; or (d) in the Operator's opinion such Additions and Capital Repairs will
improve the Facility, maximize Facility Operating Revenues or reduce Facility
Operating Expenses. Except in the case of an Emergency Expenditure as described
below, the Operator may not make or permit Additions and Capital Repairs to the
Facility if construction of the Additions and Capital Repairs would unreasonably
interfere with (i) Home Games or the Team's Areas, without the prior approval of
the Team or (ii) County Events, without the prior approval of the County. Upon
installation, the Additions and Capital Repairs shall become a part of the
Facility and the property of the County, as applicable. Subject to the
foregoing, the Operator may use funds available in the Renewal and Replacement
Account to pay for Additions or Capital Repairs. However, Operator may not use
27
funds from any other Account to pay for Additions and Capital Repairs without
prior written consent of County except in the case of an Emergency, when the
Operator may make Emergency Expenditures from funds available in any Account to
the extent Operator deems such Emergency Expenditures necessary in its
reasonable discretion. Notwithstanding the above, the County shall have the
right to review, comment upon and approve the construction plans and
specifications for any Additions and Capital Repairs with an aggregate cost in
excess of $100,000.00 and, upon completion, County shall be provided a copy of
the "as built" construction plans. Additionally, the Operator shall keep the
Facility free from, and shall indemnify the County with respect to all Liens
incurred or permitted by the Operator or incurred or permitted by any licensee
or lessee. If within sixty (60) days following the filing or other assertion
of any such Lien, the Operator does not cause such Lien to be released in a
manner satisfactory to the County (such as by posting a bond or other
acceptable security), the County shall have the right but not the obligation to
cause the Lien to be released by any means the County deems proper including,
without limitation, payment of the Lien. All reasonable sums paid and expenses
incurred by the County in connection therewith including, without limitation,
reasonable attorneys' fees and costs, shall be Facility Operating Expenses
payable by the Operator to the County upon demand plus interest at the Premium
Rate computed from the date any such sum was paid by the County.
8.2 Incremental County Preferred Revenue Allocation. In the
event that Project cost overruns occur as set forth in the Development
Agreement, or the Operator determines that certain capital or other
infrastructure improvements at the Facility are necessary for the prudent and
efficient operation of the Facility, then Operator shall propose and Board may,
subject to debt capacities, use diligent, good faith efforts to facilitate the
financing and construction of such improvements. The Board, subject to
necessary Board approvals from time to time, shall utilize diligent, good faith
efforts to secure such financing at the lowest cost of capital, whether taxable
or tax-exempt, and may identify legally available non-ad valorem revenue sources
which could be contributed to assist or enable the underwriting or credit
enhancement of the financing. Upon completion of such improvements, Team is
obligated pursuant to the License Agreement to pay supplemental rent to
Operator, when considered along with County sources, if any, (subject to
adjustment for certain federal income tax considerations relating to the Bonds),
in an amount equal to the cost of such additions or improvements including
interest on the financing of such additions or improvements, amortized over the
remainder of the License Term or such other term as mutually agreed by the
Operator, County and Team. Operator shall pay any such supplemental rent to
County as an Incremental County Preferred Revenue Allocation.
8.3 Operator Right to Finance Additions. Operator shall have
the right to issue private debt for its construction of Additions, Capital
Repairs or other improvements on the Project Site and/or improvements and
enhancements related to traffic and transportation ("Operator Improvement
Debt"). Operator may use any revenues attributable to Seat Use Charges as the
sole source for repayment of the Operator Improvement Debt.
8.4 County. County shall have no right to make Additions
and Capital Repairs or other repairs to the Facility unless an Emergency exists
and, in the County's reasonable discretion, the
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Operator has not taken action necessary to preserve the Facility. To the
extent time is available, County shall contact Operator prior to the County's
making any expenditure, Additions or Capital Repairs or other repairs to the
Facility pursuant to this Section to discuss Operator's actions taken or to be
taken with respect to the Emergency and to attempt to avoid duplication of
efforts. Any expenditure made by County pursuant to this Section shall be
reimbursed by Operator to County as an Emergency Expenditure. Depending on the
nature of the expenditure, such expenditures shall be a Facility Operating
Expense payable from the Operating Fund or an expenditure payable from the
Renewal and Replacement Account.
ARTICLE IX
IMPOSITIONS
9.1 General. Subject to the County's obligations under
Sections 9.3 and 9.4, and the availability of funds as described in 5.2, the
Operator shall pay or cause to be paid any and all Impositions that accrue
during the Term of this Agreement, as and when they become due and payable, and
before any fine, penalty, interest or cost may be added thereto or become due or
be imposed by operation of law for the nonpayment thereof. Any Imposition that
includes a period of time prior to the Expiration Date (whether or not such
Imposition shall be assessed, levied, confirmed, imposed upon or become a lien
upon the Facility, or shall become payable, during the Term hereof) shall be
prorated between the County and the Operator so that the County shall pay the
portion of Imposition applicable to the period after the Expiration Date, and
the portion of Imposition applicable during the Term of this Agreement shall be
paid by the County and the Team in accordance with their respective shares of
Net Operating Income in effect immediately prior to the Expiration Date.
9.2 Permitted Contests. The Operator may contest the legal
validity or amount of any Imposition for which the Operator is wholly or
partially responsible hereunder and may institute such proceedings as it
considers necessary therefor without undue delay and shall prosecute such
proceedings to a final determination with reasonable dispatch. If the Operator
contests any Imposition, the Operator shall notify the County and may withhold
or defer payment or make payment of the Imposition under protest so long as such
withholdings or deferrals do not subject the Facility to a non-curable
forfeiture or sale without right of redemption. The County shall cooperate
reasonably in any permitted contest and shall execute any documents or pleadings
reasonably required for such purpose. Any proceedings to contest the validity
or amount of an Imposition or to recover any Imposition paid by the Operator
shall be prosecuted by the Operator. All costs and expenses described in this
Section shall be Facility Operating Expenses.
9.3 Ad Valorem Tax Imposition. It is acknowledged by the
parties that the County and Team have based their projections and assumptions as
to sharing of Net Operating Income, described herein, on the basis that there
will be no levy of County, City, school district, water management district or
any other form of ad valorem taxes on the Facility or its operations, including
the License
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Agreement, by reason of exemption from ad valorem taxes set forth in Sections
196.199(2) and 196.102(6) Florida Statutes. Accordingly, if County, City,
school district, water management district, or any other form of ad valorem
taxes are subsequently assessed against the Facility or its operations,
including the License Agreement, and after contest of such taxes through such
efforts as Team or Operator shall deem sufficient to determine that such taxes
are declared validly assessed against the Facility or its operations, then this
Agreement and the License Agreement shall be amended in the following manner:
Said ad valorem taxes (paid by the Operator in respect of
the Facility, whether County, City, school district or water
management district portion) will constitute an Operator
credit against the County Preferred Revenue Allocation (and
a credit against any obligation of the Team under the
Guaranty Agreement, if applicable), and accordingly the
County Preferred Revenue Allocation shall be reduced in that
and subsequent Fiscal Years by an amount equal to such
County and City ad valorem taxes based on the November
discounted amount (as if such taxes were paid in November,
regardless of when paid), plus interest thereon from the
November date at the Premium Rate.
The parties agree to execute the required amendments to this
Agreement, when and if required, to effectuate the contingent events set forth
in this Section.
9.4 Exclusive Taxes and Special Assessments. If, in the
future, the County imposes any form of tax and/or special assessment, which is
exclusively imposed or levied on the Facility or the License Agreement and that
will be assessed on Hockey Tickets, or tickets to other Events, Concessions,
parking, Rent or other revenue streams of the Facility or its tenants or
licensees including the Team or the Operator, then the County Preferred Revenue
Allocation (and any obligation of the Team under the Guaranty Agreement, if
applicable) in that Fiscal Year and to the extent necessary to provide proper
credit to Operator in subsequent Fiscal Years, shall be reduced by an amount
equal to the aggregate amount of exclusively imposed taxes plus interest thereon
at the Premium Rate from the date when paid. For purposes of this Agreement, an
"exclusively imposed or levied tax" shall mean any tax and/or special assessment
that generates more than twenty percent (20%) of its composite collections from
the Facility or the operations at the Facility.
The parties agree to execute the required amendments to this Agreement,
when and if required, to effectuate the contingent events set forth in this
Section.
ARTICLE X
INDEMNIFICATION
10.1 Indemnification of County. Operator shall defend,
indemnify and hold harmless County and its elected officials, agents, officers
and employees (collectively, "County Indemnitees")
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from and against any and all demands, losses, judgments, damages, suits, claims,
actions, liabilities and expenses (including, without limitation, all attorneys
fees and expenses), in law or in equity, of every kind and nature whatsoever,
for bodily injury, death or damage to property, which any County Indemnitees may
suffer or sustain or which may be asserted or instituted against any of the
County Indemnitees resulting from, arising out of or in connection with (except
to the extent caused by County's gross negligence or wilful misconduct with
respect to any injury to or death of any individual person or with respect to
damage to or destruction of property) (i) injury to or death of any individual
person or damage to or destruction of property caused by Operator's use or
occupancy of Facility (or any portion thereof), including without limitation,
the conduct or management of its business in any portion of the Facility and its
management and operation of the Facility, (ii) the breach by Operator of any
warranty, representation or covenant made in this Agreement, or (iii) any
violation of any copyright, patent, service mark, trade name or trademark by
Operator.
10.2 Indemnification of Operator. County shall defend,
indemnify and hold harmless Operator, its agents, directors, partners,
shareholders of the Operator's general partner, officers and employees
(collectively "Operator Indemnitees") from and against any and all demands,
losses, judgments, damages, suits, claims, actions, liabilities and expenses,
(including without limitation, all attorneys fees and expenses) in law or in
equity, of every kind and nature whatsoever, for bodily injury, death or damage
to property, which any Operator Indemnitees may suffer or sustain, or which may
be asserted or instituted against any of the Operator Indemnitees, resulting
from, arising out of or in connection with (except to the extent caused by
Operator's gross negligence or wilful misconduct with respect to any injury to
or death of any individual person, or with respect to damage to or destruction
of property) (i) injury to or death of any individual person or damage to or
destruction of property arising from County's ownership, construction, use,
operation, maintenance or occupancy of the Facility (or any portion thereof)
including, without limitation, the conduct of any County Events in the Facility,
or any part thereof or of any County business; (ii) County's use or occupancy of
the Facility (or any portion thereof) in violation of this Agreement; (iii) the
breach by County of any its warranties, representations or covenants made in
this Agreement; (iv) all environmental liabilities arising out of, in connection
with, or relating to any environmental condition of the Facility, even if
discovered prior to commencement of the Term, unless such environmental
condition was caused by Operator Indemnitees; (v) the performance of any labor
or services or the furnishing of any materials or other property in respect to
the Facility; (vi) any violation of any copyright, patent, service mark, trade
name or trademark by County; and (vii) any acts or omissions of any County
Indemnitees. Operator acknowledges that County's obligations to indemnify shall
be limited to the extent of County's insurance and as provided by Florida law.
10.3 Insurance. The County acknowledges that it shall look
first to the proceeds of any insurance policies maintained by Operator pursuant
to Article XI for recovery in respect of the obligations of the Operator under
this Article X and, if such proceeds are insufficient, then to Operator.
10.4 Claims. If any claim, action or proceeding is made or
brought against the County as to which the Operator is to indemnify the County
as required by this Article X, then upon demand
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by the County, the Operator shall resist or defend such claim, action or
proceeding in the County's name, if necessary, by the attorneys for the
Operator's insurance carrier (if such claim, action or proceeding is covered by
insurance). Notwithstanding the foregoing, after notice to the Operator, the
County may engage its own attorneys to defend it or to assist in its defense,
and the County shall pay the reasonable fees and disbursements of such
attorneys. Any and all costs and expenses incurred by the Operator to
discharge its obligations under this Article X shall be included as Facility
Operating Expenses; provided, however, that any expenses resulting from an
Event of Default by the Operator shall not be included as Facility Operating
Expenses and shall be paid by the Operator from its own funds; and provided,
further, that any expenses resulting from an Event of Default by the County
shall not be included as Facility Operating Expenses and shall be paid or
reimbursed by the County from its own funds.
ARTICLE XI
INSURANCE
During the term of this Agreement, the Operator (and County to the
extent provided in Section 11.8) shall cause to be maintained the following
insurance:
11.1 Casualty. Insurance against loss or damage to the
Facility resulting from fire, earthquake, windstorm, hail, lightning, vandalism,
malicious mischief, flood and such other perils ordinarily included in special
all-risk extended coverage insurance policies. Such insurance shall be
maintained in an amount not less than the then full replacement cost of the
Facility, the equipment and machinery therein and including any costs which may
be required to comply with applicable governmental requirements. Full
replacement cost shall be determined at reasonable intervals at the request of
the County by appraisal by the Operator's insurer or other appraiser mutually
acceptable to the Operator and the County.
11.2 Business Interruption. Use and occupancy or business
interruption or lost income insurance against the perils of fire, earthquake,
windstorm, hail, lightning, vandalism, malicious mischief, flood and such other
perils ordinarily included in "special all-risk extended coverage" insurance
policies, in an amount equal to not less than estimated Facility Operating
Revenues less non-continuing expenses (assuming for the purposes of such
estimate that no business interruption occurred), for the period of time
estimated to repair or rebuild the Facility after substantial damage to the
Facility.
11.3 Liability. Commercial general liability insurance with
a broad form general liability endorsement which shall provide coverage against
claims for personal injury, death and property damage resulting directly or
indirectly from any act or activities (in connection with the Facility) of the
County, the Operator, any of their respective invitees, officers, partners,
shareholders of partners, officers, employees, agents, independent contractors
or any other person acting for the County or the Operator or under their
respective control or direction (including liabilities for injuries or damages
alleged to have resulted from the Operator's sale and/or dispensing of alcoholic
32
beverages). Such insurance shall be maintained in full force and effect during
the term of this Agreement in an amount of at least Twenty-Five Million Dollars
($25,000,000) (provided that the Operator shall be entitled to maintain a
lesser amount if such lesser amount is maintained in comparable facilities at
which NHL teams play and the County is notified of such lesser amount and fails
within twenty (20) Business Days after receipt of such notice to object and
submit to ADR the adequacy of such lesser amount) combined single limit, naming
the County, and its officers, the Operator, and their respective invitees,
licensees, employees, agents, independent contractors or any other person
acting for the County or the Operator or under their respective control or
direction, as additional insureds. This Section 11.3 shall not limit in any
way the extent to which the Operator may be held responsible for the payment of
damages to persons or property resulting from the Operator's activities, the
activities of its invitees, employees, licensees, agents or independent
contractors, or the activities of any other person or persons for whom the
Operator otherwise is legally responsible.
11.4 Workers Compensation. Worker's compensation insurance
complying with the statutory requirements of the State of Florida to insure all
persons or entities employed by the Operator in connection with the Facility.
Operator shall also purchase and maintain Employer's liability coverage for no
less than $1,000,000 each accident, $1,000,000 disease each employee and
$1,000,000 disease policy aggregate.
11.5 Builder's Risk or Installation Floater. During
construction of Additions and Capital Repairs, in addition to (but not in
duplication of) the other insurance coverages required under this Article,
standard "all risk" builder's risk or installation floater insurance written on
a completed value basis and including comprehensive liability insurance, in an
amount not less than the projected total cost of construction of the Additions
and Capital Repairs as reasonably estimated by the Operator not more than sixty
(60) days prior to commencement of construction and as thereafter revised from
time to time by the Operator during the course of such construction.
11.6 Other. Such other insurance coverages and in such
amounts as from time to time may be reasonably desired by Operator to insure
against such other insurable hazards as are customarily insured against in the
case of similar multipurpose sports and entertainment facilities.
11.7 Provisions.
11.7.1 All required insurance shall be primary
coverage and shall be for the benefit of the
Operator and the County.
11.7.2 All required insurance shall be reviewed
periodically by the Operator, and in any
event at least every three years, for the
purpose of determining whether to increase or
decrease the minimum limits and deductibles
of such insurance to amounts which may be
reasonable and customary for facilities of
like size and operation to the Facility.
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11.7.3 All required insurance shall be obtained from
a financially sound insurance company, rated
not less than B+ XII in Best's Rating Guide,
authorized to do business in the State of
Florida.
11.7.4 All required insurance shall provide that the
waiver of recovery (subrogation) provided in
Section 11.9 shall not invalidate or have any
adverse effect on the liability of the
insurer.
11.7.5 All required insurance shall provide that
such policies or certificates shall not be
cancelled or materially changed without the
consent of the County which shall be given
notice of an intent to cancel or materially
change said insurance at least thirty (30)
days' prior written notice to the County.
11.7.6 Prior to the Operations Start Date, the
Operator shall provide the County with a copy
of property policies covering the facility
together with certificates of insurance from
the companies issuing other policies required
by this Agreement, indicating that such
required insurance coverage provided by such
policies is in place. At least ten (10) days
prior to the expiration of any such property
policy, a copy of the renewal policy shall be
provided to the County and renewal
certificates of insurance will be provided on
such other insurance coverages.
11.8 Insurance for County Events. County acknowledges and
agrees that prior to scheduling a County Event, County shall obtain or Operator
shall purchase as a County Event Related Expense comprehensive general liability
insurance which shall provide coverages against claims for personal injury,
bodily injury, death and property damages arising from the conduct of the County
Event at the Facility or the negligence or misconduct of County, its employees,
agents, independent contractors, co-promoters or any other person acting on
behalf of County. The policy shall have minimum limits of liability of
$1,000,000 combined single limit each occurrence, $2,000,000 aggregate. The
insurance required under this Section 11.8 shall in all events comply with the
requirements of Article XI. Notwithstanding the foregoing, the County, upon
written notification to the Operator and upon compliance with such other
reasonable requirements of Operator (including the requirement for County to
provide security for its obligations) at least fifteen (15) days prior to any
County Event, may elect to self insure for such County Event. In such event,
County shall be obligated to pay any and all amounts and provide any other
services (including the duty to defend Operator and Team) to Operator which an
insurer would be required to pay or provide under the insurance coverages
otherwise required under this Section and County shall pay and/or provide such
services within the time periods required under standard insurance coverages.
Any failure by County to pay and/or perform as provided herein shall be deemed a
default by County and shall entitle Operator to exercise its rights with respect
to the security provided by County pursuant to this Section or to exercise any
other rights under this Agreement.
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11.9 Waiver of Recovery. Neither the Operator nor the County
shall be liable to the other party or to any insurance company (by way of
subrogation or otherwise) insuring the other party for any loss or damage to
property or injury to persons, or any resulting loss of income, or losses under
workers' compensation laws and benefits, even though such loss or damage might
have been occasioned by the negligence of such party, its agents or employees,
if and to the extent any such loss or damage is covered by insurance benefiting
the party suffering such loss or damage.
11.10 Failure to Maintain Insurance. If the Operator fails or
refuses to procure or maintain the insurance required by this Article, after
notice to the Operator, the County shall have the right, at its election, to
procure and maintain such insurance, in which event, any reasonable premium paid
by the County, plus interest at the Premium Rate computed from the date such
premium is paid by the County, shall be due and payable by the Operator as a
Facility Operating Expense to the County on the first day of the month following
the date on which such premium was paid. The County shall give prompt notice of
the payment of any premium stating the amount paid.
11.11 Proceeds Disposition. All insurance proceeds with
respect to loss or damage to the Facility shall be payable, under the provisions
of the policy of insurance, into the Renewal and Replacement Account. All
insurance proceeds from any other insurance policies maintained hereunder shall
be payable into the Operating Fund.
ARTICLE XII
DAMAGE OR DESTRUCTION
12.1 Adequately Insured Damage. Subject to the provisions of
Section 12.2 and Section 12.3, if the Facility is damaged or otherwise destroyed
and such damage or destruction was caused by a casualty covered under an
insurance policy maintained by the Operator as required hereunder, all insurance
proceeds paid under such insurance policies ("Insurance Proceeds") shall be
deposited into the Renewal and Replacement Account and, if such proceeds are
sufficient to restore the Facility in the reasonable estimation of Operator,
shall be used by the Operator to repair such damage or destruction as soon as
reasonably possible, and this Agreement shall continue in full force and effect.
Such restoration shall be in compliance with applicable governmental
requirements. All such restoration shall be performed under the joint
supervision of the County and the Operator.
12.2 Insurance Deficiency and Termination. Subject to the
provisions of Sections 12.3 and 12.4, if the Facility is damaged or otherwise
destroyed by a casualty not covered under an insurance policy or, if so covered,
the Insurance Proceeds are insufficient, in the reasonable estimation of
Operator, to pay the costs of restoration, and if there are funds in the Renewal
and Replacement Account in an amount sufficient, in the reasonable estimation of
Operator, to pay the costs of restoration that exceed the Insurance Proceeds
(the "Insurance Deficiency"), the Operator shall repair, or cause to be
repaired, the damage or destruction as provided in Section 12.1. If Renewal and
Replacement Account funds are insufficient to pay the Insurance Deficiency,
then,
35
within thirty (30) days after the date such damage or destruction occurred (the
"Destruction Date") the Operator shall provide the County written notice of the
Operator's election either (a) to utilize the Insurance Proceeds and such funds
as are available in the Renewal and Replacement Account plus the Operator's own
funds (and not Facility Operating Revenue) to pay the costs of restoration, or
(b) to terminate this Agreement. In the event the Operator elects to utilize
Insurance Proceeds, funds as are available in the Renewal and Replacement
Account and its own funds to restore the Facility to the state in which it
existed prior to such damage or destruction, the Term of this Agreement shall
be suspended during such restoration, as provided in Section 12.5. In the
event the Operator is entitled to and does elect to terminate this Agreement,
the County shall have the right (within thirty (30) days after receipt of such
notice of the Operator's election to terminate) to issue notice to the Operator
of the County's intention to pay the Insurance Deficiency, in which event, the
County shall commit in writing to deposit the amount of the Insurance
Deficiency into the Renewal and Replacement Account and shall deposit such
amount into the Renewal and Replacement Account within ten (10) days of its
written commitment. Thereafter, the Operator's election to terminate shall be
deemed rescinded and void, and the Operator shall effect the restoration of the
Facility as provided in Section 12.1. If the County does not issue such notice
of its intention to pay such Insurance Deficiency within thirty (30) days after
receipt of the Operator's election to terminate, this Agreement shall be
terminated at the expiration of such thirty-day period, and the Insurance
Proceeds, if any, shall be deposited into the Renewal and Replacement Account
for distribution as provided in Section 12.4.
12.3 End of Term. If the Facility is destroyed during the
last two Fiscal Years of the term hereof, then notwithstanding any contrary
provision of this Article, by notice to the County within thirty (30) days after
the Destruction Date, the Operator may terminate this Agreement, whereupon the
Insurance Proceeds, if any, shall be deposited into the Renewal and Replacement
Account and shall be distributed pursuant to Section 12.4.
12.4 Distribution. In the event this Agreement is terminated
pursuant to Section 12.2 or 12.3, and notwithstanding any provisions of Article
V to the contrary, any funds in the Renewal and Replacement Account after the
deposit of any Insurance Proceeds therein pursuant to this Article shall be
distributed to the County and applied by the County to reduce debt service on
the Bonds. Any funds in other Accounts shall be distributed in accordance with
Article V, and funds in the Operating Reserve Account should be distributed as
of such funds were part of the Operating Fund.
12.5 Abatement. In the event of any damage or destruction
rendering a substantial portion of the Facility unusable, the period during
which a substantial portion of the Facility remains unusable shall be an
Abatement Period.
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ARTICLE XIII
EMINENT DOMAIN
13.1 Substantial Taking. If the Facility is taken by right
of eminent domain, with or without litigation, or transferred in lieu of or
under threat of such action (any such action to be referred to herein as a
"Taking"), and the Taking is a "Substantial Taking," the Operator shall have the
right, at its option, exercisable at any time within the ninety (90) days after
the official written notice of the Taking and its scope is issued by the
condemnor and received by the Operator and the County (the "Taking Date"), to
terminate this Agreement, in which event, the parties shall be released from all
future liability hereunder (such release to be effective upon the termination of
this Agreement pursuant to this Section, provided, however, that no party shall
be released from any liability hereunder that has accrued on or before such
termination.) The payment or other award from the condemnor attributable to the
value of any improvements on the Project Site ("Award") shall be deposited into
the Renewal and Replacement Account. As used in this Section, "Substantial
Taking" means a Taking of the Facility that in the reasonable estimation of
Operator, will deprive the Facility of the substantial economic benefits to be
derived from the operation thereof.
13.2 Partial Taking.
13.2.1 If the Facility is the subject of a Taking
which is not a Substantial Taking or if a
Substantial Taking occurs but this Agreement
is not terminated as provided in Section 13.1,
then as soon as reasonably possible, the
Operator shall restore the remainder of the
Facility using the proceeds available from the
Award, and this Agreement shall continue in
effect. Such restoration shall be in
accordance with plans approved by the County
and in compliance with then applicable
governmental requirements. All such
restoration shall be performed under the joint
supervision of the County and the Operator.
13.2.2 If (a) the Facility is to be restored as
provided in Section 13.2.1, (b) the Award is
insufficient to pay the costs of such
restoration in the reasonable estimation of
Operator, and (c) funds in the Renewal and
Replacement Account are sufficient to pay the
amount by which such costs of restoration
exceed the Award ("Condemnation Deficiency"),
the Operator shall restore the Facility using
available proceeds as provided in Section
13.2.1. If the Renewal and Replacement
Account is insufficient to pay the
Condemnation Deficiency, within ninety (90)
days after the Taking Date the Operator shall
provide the County written notice of the
Operator's election either (a) to utilize the
Award and such funds as are available in the
Renewal and Replacement Account plus the
Operator's own funds (and not Facility
Operating Revenue) to pay the costs of such
restoration, or (b) to terminate
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this Agreement. In the event the Operator is
entitled to and does elect to terminate this
Agreement, the County shall have the right
(within ten (10) days after receipt of such
notice of the Operator's election to
terminate) to issue notice to the Operator of
the County's intention to pay the Condemnation
Deficiency, in which event, the County shall
deposit the amount of the Condemnation
Deficiency within ten (10) days of such
notice, and thereafter the Operator's election
to terminate shall be deemed rescinded and
void, and the Operator shall effect the
restoration as provided in Section 13.2.1. If
the County does not give such notice of its
intention to pay such Condemnation Deficiency
within ten (10) days after receipt of the
Operator's election to terminate or does not
deposit the Condemnation Deficiency into the
Renewal and Replacement Account at the time
described above, this Agreement shall be
terminated at the expiration of such ten day
period, or after the time required for the
deposit of the Condemnation Deficiency, as
applicable, and the Award shall be deposited
into the Renewal and Replacement Account for
distribution pursuant to Section 13.4.
13.3 End of Term. If a Substantial Taking occurs during
the last two Fiscal Years of the term hereof, then notwithstanding any
provision of this Article to the contrary, by notice to the County within
thirty (30) days after the date of the Taking, the Operator may terminate this
Agreement whereupon the Award shall be deposited into the Renewal and
Replacement Account and shall be distributed pursuant to Section 13.4.
13.4 Distribution. In the event this Agreement is terminated
pursuant to Section 13.1, 13.2 or 13.3, and notwithstanding any provision of
Article V to the contrary, any funds in the Renewal and Replacement Account
after the deposit of the Award pursuant to this Article XIII shall be
distributed to the County and applied to reduce debt service on the Bonds. Any
funds in other Accounts shall be distributed in accordance with Article V and
funds in the Operating Reserve Account shall be distributed as if such funds
were part of the Operating Fund.
13.5 Abatement. In the event of a Taking rendering a
substantial portion of the Facility unusable, the period during which a
substantial portion of the Facility remains unusable shall be an Abatement
Period.
13.6 No Condemnation by County. Notwithstanding the
foregoing or any provision of this Agreement, the County covenants, warrants,
represents and agrees that it shall not at any time during the Term initiate,
engage in, undertake, attempt or pursue either singly or in combination with any
other governmental entity(ies) a condemnation proceeding by right of eminent
domain of any portion of the Facility.
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ARTICLE XIV
ASSIGNMENT AND TRANSFER
14.1 Right to Assignment. The Operator shall have the right
to assign this Agreement i) in connection with the sale of Team in compliance
with NHL requirements (the Team or Operator shall provide the County with a copy
of the transfer application at the time it is submitted to the NHL) to any
Person who thereafter shall control or be under common control with the Team (or
the Person which owns the Franchise), ii) to a Public Entity Assignee and iii)
to a Person with a fair market value net worth of at least Ten Million Dollars
($10,000,000) (including the net worth of such Person's affiliates) which has
experience in the ownership or management of at least one multipurpose arena of
at least 10,000 seats for at least five years, whether such experience is that
of the Person directly or of its principals, agents or employees. Any
transferee or purchaser of the Team's Franchise or the Public Entity Assignee
shall take subject to and must assume all of the obligations of the Operator
under this Agreement. The Operator or Team shall require the transferee or the
Public Entity Assignee to execute an Assignment and Assumption Agreement in such
form and content as is reasonably acceptable to the County and Operator. Any
such transfer shall conform to the terms and restrictions of the License
Agreement and this Agreement. Except for the foregoing, the Operator shall not
assign or transfer its rights or interests in this Agreement without the prior
written consent of County.
14.2 Prohibition Against Assignment of Agreement or Transfer
of the Facility by the County. The County shall not transfer or attempt to
transfer this Agreement or any rights herein, and any such transfer or attempted
transfer shall be void.
ARTICLE XV
REPRESENTATIONS, WARRANTIES AND COVENANTS
15.1 County Representations, Warranties and Covenants. The
County represents, warrants and covenants to the Operator the following:
15.1.1 Authority. The County has full power and
authority to enter into this Agreement, and
the execution, delivery, and consummation of
this Agreement by the County have been duly
authorized.
15.1.2 No Conflicts. The execution, delivery and
performance of this Agreement, does not
conflict with any other agreements,
instruments, judgments or decrees to which
the County is a party or is otherwise
subject.
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15.1.3 No Violation of Laws. Neither the execution,
delivery nor performance of this Agreement by
the County violates or will violate the
County Charter, the County Code or any
ordinance or resolution of the County. The
County has received no notice as of the date
of this Agreement asserting any noncompliance
in any material respect by the County with
applicable statutes, rules and regulations of
the United States of America, the State of
Florida, the County, or of any other state or
municipality or agency having jurisdiction
over and with respect to the transactions
contemplated in and by this Agreement; and
the County is not in default with respect to
any judgment, order, injunction or decree of
any court, administrative agency, or other
governmental authority which is in any
respect material to the transactions
contemplated hereby.
15.1.4 Litigation. No suit is pending before or by
any court or governmental body seeking to
restrain or prohibit, or seeking damages or
other relief in connection with, the
execution and delivery of this Agreement or
the consummation of the transactions
contemplated hereby or which might materially
and adversely affect the use and operation of
the Facility as contemplated herein.
15.1.5 Project Site Possession and Title. The
rights of the Operator pursuant to this
Agreement, and the Operator's peaceful use
and quiet enjoyment of the Facility as
provided in this Agreement, shall not be
diminished, impaired or disturbed in any way
by any lien, encumbrance, easement,
right-of-way, covenant, condition,
restriction, defect, invalidity or any other
matter adversely affecting the County's
rights of possession in, or title to, the
Project Site, or by any other insufficiency,
limitation, restriction or defect in the
rights of the County to possess and
reasonably use the Project Site or its
ownership or title thereto (collectively
"Title Exceptions"). The County shall pay
and be responsible for all liabilities,
losses, damages, costs, expenses and charges
including, without limitation, reasonable
attorneys' fees and costs, that may be
incurred or suffered by the Operator as a
result of any Title Exceptions, none of which
shall be treated as Facility Operating
Expenses.
15.1.6 Utility Rates. The County will use its best
efforts to negotiate long-term discounted
utility charges from public and private
utilities which will provide water, sewage,
gas, electric and waste handling and
recycling services to the Facility. The
County and Operator acknowledge that the City
is separately obligated to perform certain of
these services pursuant to the Sunrise Letter
of Agreement.
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15.1.7 Non-Competition. During the term of this
Agreement, except as provided herein, the
County agrees that it shall not directly or
indirectly, own, manage, operate, control,
finance, sponsor, develop, provide
County-owned land for or in any other way
participate in or cooperate with any indoor
or outdoor sports entertainment or multi-use
arena with an attendance capacity of 5,000 to
30,000 and located within Broward County
("Competing Facility") to which the general
public is invited with or without charge for
concerts, sports, entertainment and other
events of the kind typically booked at arenas
comparable to the Arena in the ordinary
course of operations thereof ("Comparable
Events"). This covenant shall not apply to
the following:
(a) the Broward Convention Center, or the
expansion thereof;
(b) the Broward Center for the Performing
Arts, or the expansion thereof;
(c) a facility for major or minor league
baseball;
(d) events in the County's regional parks and
all uses and practices of the County
presently in effect with respect to
public events in public places of the
County; and
(e) any other facility that does not book
Comparable Events.
15.1.8 No Arena Use by the County Which is
Competitive With Use by Operator. The County
shall use the Arena only for County Events
and celebrations (a) which do not feature
performers or performances which are normally
booked in arenas comparable to the Arena and
(b) for which ticket prices are less (when
compared nationally with reference to
industry guides) than those typically charged
for Comparable Events ("Non-Commercial
Events"). The County will not use the
Communication System in the Arena for
announcement of any event other than
Non-Commercial Events and public service
announcements.
15.2 Enforcement. The County agrees that the rights
conveyed by Section 15.1.7 are of a kind for which there is no adequate remedy
at law and for which money damages will not be adequate compensation.
Therefore, the County agrees that, if the County breaches the covenants of
Section 15.1.7, the Operator shall have the right, to obtain an injunction or
decree of specific performance from any court of competent jurisdiction to
restrain or compel the County to perform the covenants contained in Section
15.1.7. The covenants of the County in each subsection of Section 15.1.7 shall
each be construed as an agreement independent of any other provision in this
Agreement. The Team shall be entitled to rely upon and enforce this Section as
a third party beneficiary. Any and all reasonable costs paid or incurred by
the Operator or the Team to enforce
41
the provisions of Section 15.1.7 shall be payable by Operator as Facility
Operating Expenses but shall be reimbursed to Operator by County from County's
own funds. Any and all amounts received by the Operator or the Team pursuant to
the enforcement of such provisions less any amounts paid or incurred by the
Operator or the Team to enforce such provisions and not reimbursed pursuant to
the preceding sentence shall be payable to Operator or Team as applicable and
shall not be deposited into the Operating Fund nor be Facility Operating
Revenue.
15.3 Optional Remedy of Operator. In the event that the
County should violate the covenants of Section 15.1.7, if the Operator seeks and
fails to obtain injunctive relief, then the Operator shall, at its option and
for as long as the County is operating a Competing Facility, be entitled to
receive payment from the County in an amount equal to the gross receipts of the
County from such Competing Facility, provided that the aggregate of all such
payments from the County to the Operator shall not exceed such gross receipts.
The parties agree that if the County were to breach Section 15.1.7, the
aggregate damages arising from such breach would be substantially incapable of
estimation due to the lost value attributable to the adverse consequences such a
breach would have on the Operator and that the amount set forth in this Section
constitutes the best, reasonable and objective estimate of the damages that
would be incurred in the event the County were to breach Section 15.1.7.
15.4 Severability. If and to the extent that a court of
competent jurisdiction determines that any provision of this Section or part
thereof is unenforceable, whether by virtue of excessive scope, geographical
limitation, term or otherwise, such provision or part thereof shall be
interpreted so as to delete that portion of the provision which exceeds the
maximum legal prohibition or otherwise to modify such provision in such a manner
so as to make this Agreement, as so modified, enforceable.
15.5 Operator Representations, Warranties and Covenants. The
Operator represents, warrants and covenants to the County the following:
15.5.1 Organization. The Operator is a limited
partnership, duly organized and validly
existing under the laws of the State of
Florida; and it has all requisite power and
authority to enter into this Agreement.
15.5.2 Authorization; No Violation. The execution,
delivery and performance by the Operator of
this Agreement have been duly authorized by
all necessary action and will not violate the
NHL Constitution or Bylaws or any written
rule, regulation or policy of the NHL, or
result in the breach of or constitute a
default under any loan or credit agreement,
or any other agreement or instrument to which
the Operator is a party or by which the
Operator or its assets may be bound or
affected. All consents and approvals of any
Person (including partners of the Operator)
required in connection with this Agreement
have been obtained.
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15.5.3 Litigation. No suit is pending against or
affects the Operator which could have a
material adverse affect upon the Operator's
performance under this Agreement or the
financial condition or business of the
Operator. There are no outstanding judgments
against the Operator.
15.5.4 No Payments. The Operator has not paid or
given, and will not pay or give, any third
person any money or other consideration for
obtaining this Agreement, other than normal
costs of conducting business and costs of
professional services such as the services of
architects, engineers and attorneys.
15.5.5 No Conflicts. No agreements between the
Operator and the Team are prohibited by nor
conflict with any other agreements,
instruments, judgments or decrees to which
the Operator is a party or is otherwise
subject.
15.5.6 No Violation of Laws. The Operator has
received no notice as of the date of this
Agreement asserting any noncompliance in any
material respect by the Operator with
applicable statutes, rules and regulations of
the United States of America, the State of
Florida, or of any other state or
municipality or agency having jurisdiction
over and with respect to the transactions
contemplated in and by this Agreement; and
the Operator is not in default with respect
to any judgment, order, injunction or decree
of any court, administrative agency, or other
Governmental Authority which is in any
respect material to the transactions
contemplated hereby.
15.5.7 Environmental and Historical Conditions. After
the Operations Start Date, (a) the Operator
shall maintain, keep current and comply in
full with any and all permits, consents and
approvals required by the Environmental Laws
and (b) the Operator shall comply with all
Environmental Laws and shall not conduct or
allow any use of or activity on or under the
Project Site that will violate or threaten to
violate any Environmental Law; provided,
however, that Operator shall have no
responsibility whatsoever to comply with
Environmental Laws with respect to any
condition existing prior to or at the time of
the Operations State Date and that the
Operator's obligations pursuant to this
Section shall not release the County from
obligations otherwise required by this
Agreement. The Operator shall promptly notify
the County if the Operator has actual
knowledge of any material noncompliance or
potential material noncompliance with any
Environmental Law or receives any written or
oral notification from any Governmental
Authority or any third party regarding any
material noncompliance or threatened or
potential material noncompliance with or any
request for information pursuant to any
Environmental Law.
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15.6 Mutual Covenants.
15.6.1 Additional Documents and Approval. The County
and the Operator, whenever and as often as
each shall be reasonably requested to do so by
the other party or by the Team, shall execute
or cause to be executed any further documents,
take any further actions and grant any further
approvals as may be necessary or expedient in
order to consummate the transactions provided
for in, and to carry out the purpose and
intent of each of the Related Agreements.
15.6.2 Good Faith. In exercising its rights and
fulfilling its obligations under each of the
Related Agreements, the County and the
Operator shall act in good faith. Each party
acknowledges that the Related Agreements
contemplate cooperation between the Operator
and the County. Each party further
acknowledges that the terms and conditions of
the Related Agreements together have been
negotiated on the basis of certain
projections and assumptions, including the
assumption that the County, the Operator and
the Team will act to advance, and not
unreasonably interfere with, the public
purposes to be served by the Facility.
15.6.3 No Termination. Neither the County nor the
Operator shall terminate this Agreement on
the ground of ultra vires act or for any
illegality or on the basis of any challenge
to the enforceability of this Agreement.
Subject to the foregoing, no such challenge
may be asserted by the County or the Operator
except by the institution of a declaratory
action in which the Operator, the County and
the Team, are named as parties.
15.6.4 Cooperation. The County and the Operator
mutually agree to contest any challenge to the
validity, authorization and enforceability of
this Agreement ("Challenge"), whether asserted
by a taxpayer or any Person. The County and
the Operator shall strive in good faith to
agree jointly upon counsel to defend any such
Challenge. If the Challenge occurs during the
construction and development period of the
Development Agreement, one-half of the costs
of contesting the Challenge shall be paid by
Operator, upon written notice and demand for
payment from the County itemizing such costs;
the remaining one-half of the costs shall be
borne by the County. If the Challenge occurs
after the Operations Start Date, the costs of
contesting the Challenge shall be treated as a
Facility Operating Expense and shall be
payable from Facility Operating Revenue.
However, if the nature of any Challenge
(whether prior to or following the Operations
Start Date) is to the effect that the County
has acted improperly or unlawfully in
executing this Agreement, then the County
shall pay all of the costs incurred by the
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parties in contesting this Challenge and any
legal fees, costs and other expenses in
connection with such Challenge shall be
treated as a Facility Operating Expense.
Furthermore, the County and the Operator shall
take all ministerial actions and proceedings
necessary or appropriate to remedy any
apparent invalidity, lack or defect in
authorization, or illegality, or to cure any
other defect, which has been asserted or
threatened.
15.6.5 Notice of Matters. Should the County or the
Operator receive knowledge about any matter
which may constitute a breach of any of its
warranties or covenants set forth herein which
arises after the date hereof, it shall
promptly notify the other party of the same in
writing. Specifically, without limitation,
the County and the Operator shall promptly
inform the other of any suits referred to in
Sections 16.4 and any Challenge referred to in
Section 16.4.
15.6.6 Compliance With Laws. During the Term of this
Agreement, the County and the Operator each
shall, in connection with its own use of (and,
in the case of the County, its ownership of)
and the exercise of its rights with respect to
the Facility, comply with all applicable laws,
ordinances, rules and regulations relating
thereto. However, the Operator shall have no
obligation to comply with any such laws to the
extent that a violation of such laws exists on
or prior to the Operations Start Date; and
such obligations shall be the responsibility
of County. The County shall obtain and
maintain all necessary permits and licenses
that are required of an owner of the Facility
or that are required of County Events at the
Facility. The Operator with the cooperation
of County shall obtain and maintain all
necessary permits and licenses that are
required in connection with the operation of
the Facility.
15.6.7 Survival of Covenants and Warranties. All
covenants, representations and warranties
contained in this Agreement shall survive the
execution and delivery of this Agreement. No
action taken pursuant to or related to this
Agreement, including, without limitation, any
investigation by or on behalf of a party
shall be deemed to constitute a waiver by the
party taking such action of compliance with
any representation, warranty, condition or
agreement herein.
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ARTICLE XVI
DEFAULTS, REMEDIES AND TERMINATION
16.1 Events of Default. Each of the following events shall
constitute an Event of Default:
16.1.1 If any representation or warranty made by the
County or by the Operator herein shall at any
time prove to have been incorrect in any
material respect as of the time made, and if
the party making such representation or
warranty fails to cause such representation or
warranty to become correct within thirty (30)
days after written notice that such
representation or warranty was incorrect;
provided, however, that if it is not
reasonably possible to cause such
representation or warranty to become correct
within such thirty-day period, such cure
period shall be for an unlimited period of
time if within thirty (30) days after such
written notice the curing party commences
diligently and thereafter continues to cause
such representation or warranty to become
correct.
16.1.2 If the Operator shall breach its obligations
under the provisions of Article V or the
County or Operator shall breach its
obligations under Article XI and such breach
is not cured within thirty (30) days after
written notice by the County to the Operator
or the Operator to the County, as applicable.
16.1.3 If the County or the Operator shall
materially breach any of the other covenants
or provisions in this Agreement other than as
referred to in Section 16.1.1 or 16.1.2 and
such failure is not cured within 30 days
after written notice; provided, however, that
if it is not reasonably possible to cure such
failure within such 30 day period, such cure
period shall be for an unlimited period of
time if within 30 days after such written
notice the curing party commences diligently
and thereafter continues to cure.
16.2 Institution of Litigation Permitted by Article
XVIII. To the extent permitted by Article XVIII, in addition to any other
rights or remedies, either party may institute litigation to recover damages
for any Event of Default or to obtain any other remedy (including specific
performance and any other kind of equitable remedy) consistent with the
purposes of this Agreement. Litigation pursuant to this Section shall only be
instituted in the Circuit Court of Broward County, Florida or in the Federal
District Court in the Southern District of Florida. The County and the
Operator consent to the jurisdiction of such courts. Subject to Article XVIII,
neither the existence of any claim or cause of action of a party, whether
predicated on this Agreement or otherwise, nor the pendency of ADR proceedings
involving another party, shall (a) constitute a defense to specific enforcement
of the obligations of such other party under this Agreement or (b) bar the
availability of injunctive relief or any other equitable remedy under this
Agreement.
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16.3 Rights and Remedies are Cumulative. Except with respect
to rights and remedies expressly declared to be exclusive in this Agreement, the
rights and remedies of the parties are cumulative and the exercise by either
party of one or more of such rights or remedies shall not preclude the exercise
by it, at the same or different times, of any other rights or remedies for the
same Event of Default or any other Event of Default by the other party.
16.4 Costs, Expenses and Fees. In the event of any
litigation, arbitration or other dispute resolution proceeding ("Challenge
Proceeding") that arises from, relates to or arises in connection with the
County's or the Operator's duties and obligations under this Agreement and is
instituted by a Person not a party to this Agreement, the Operator or the County
shall be entitled to advances from and to be reimbursed from Facility Operating
Revenue for all costs and expenses incurred by any of them in such Challenge
Proceeding, including reasonable attorneys fees and costs, and such costs and
expenses shall be treated as Facility Operating Expenses, and any award granted
to the Operator or the County in such Challenge Proceeding, including an award
of any such costs and expenses, shall be treated as Facility Operating Revenue.
In the event of any litigation, arbitration or other dispute resolution
proceeding in connection with this Agreement, involving a claim against a party
to this Agreement by the other party to this Agreement ("Proceeding"), (a) no
party shall be entitled to advances from or to be reimbursed from Facility
Operating Revenue for any costs or expenses incurred by it in such Proceeding,
including reasonable attorneys' fees or costs, (b) no such costs and expenses
shall be treated as Facility Operating Expenses, (c) the prevailing party in
such Proceeding shall be entitled to be reimbursed by the other party (and not
from Facility Operating Revenue) for all costs and expenses incurred in such
Proceeding, including reasonable attorneys' fees and costs as may be fixed by
the Circuit Court of Florida for Broward County, Florida the Federal District
Court for the Southern District of Florida, or the arbitrator, and (d) any award
granted to a party in such Proceeding shall be treated as the sole property of
such party.
16.5 Acceptance of Legal Process.
16.5.1 Service on County. In the event that any
legal or equitable action is commenced by the
Operator against the County, service of
process on the County shall be made by
personal service upon the Office of the Chair
of the Board, or in such other manner as may
be provided by law.
16.5.2 Service on the Operator. In the event any
legal or equitable action is commenced by the
County against the Operator, service of
process on the Operator shall be made by
personal service upon the statutory agent of
the limited partnership, in the State of
Florida (which Florida resident agent
Operator shall establish), or in such other
manner as may be provided by law.
16.6 Termination. Notwithstanding any other provision
herein to the contrary, this Agreement may not be terminated by the Operator or
the County except as specifically permitted in Sections 12.2, 12.3, 13.1, 13.2,
13.3, 16.6.1, 16.6.2 or 16.6.3.
47
16.6.1 Termination of Operator by the County.
Provided that the County is not in default of
this Agreement and has caused no event to
occur or condition to exist which with the
passage of time or the giving of notice, or
both, would constitute a default under this
Agreement, the County at its option may
terminate the Operator upon fifteen (15) days
written notice to the Operator if the Operator
has caused an Event of Default to occur.
Immediately upon such termination the County
and the Team(s) shall select a replacement
operator who shall be subject to the terms and
conditions of this Agreement. If the County
and the Team(s) fail to agree on a replacement
operator, the Operator shall continue to carry
out its obligations under this Agreement (if
directed to do so by the County)until such
time as the County and the Team agree on a
replacement Operator.
16.6.2 Termination of Agreement by the Operator.
Provided that the Operator is not in default
of this Agreement and has caused no event to
occur or condition to exist which with the
passage of time or the giving of notice, or
both, would constitute a default under this
Agreement, the Operator at its option may
terminate its obligations under this
Agreement after fifteen (15) days prior
written notice to the County if the County
has caused an Event of Default to occur. If
the Operator terminates its obligations under
this Agreement for an Event of Default by the
County, the Operator shall continue to carry
out its obligations hereunder, if directed to
do so by the County, for a reasonable period
of time to permit the selection of a
replacement operator. The Operator shall be
entitled to a commercially reasonable fee for
its services after termination.
16.6.3 Automatic Termination of Agreement. This
Agreement automatically terminates upon any
lawful termination by the Team, the Operator
or the County of the License Agreement or
upon any termination of the Development
Agreement pursuant to Section 8.1 or Section
14.1 thereof (except as expressly provided in
such Section 14.1).
16.6.4 Rights After Termination of Agreement. In the
event of the termination of this Agreement,
the County and the Operator shall have no
further rights against or liabilities to each
other under this Agreement, except for
liabilities or rights which accrued prior to
termination. In the event of a termination by
reason of an Event of Default, each party
shall have available to it all of its rights
and remedies under this Agreement and in law
and equity.
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ARTICLE XVII
DISPUTE RESOLUTION
Except for Events of Default specified in Section 16.1.2, in the event
of any default, breach or other dispute between the parties in connection with
this Agreement (collectively, the "Dispute"), the parties shall comply with the
following procedures (all of which shall collectively be referred to as "ADR").
Within seven (7) Business Days after written request (the "Request") by either
party, the parties promptly shall hold an initial meeting to attempt in good
faith to negotiate a settlement of the Dispute. No Request concerning a
Dispute may be made at any time after two (2) years following the occurrence of
the event giving rise to the Dispute. If within ten (10) days after the
Request, the parties have not negotiated a settlement of the Dispute, the
parties jointly shall appoint a mutually acceptable neutral person who is not
affiliated with either of the parties (the "Neutral"). If the parties are
unable to agree upon the appointment of the Neutral within fourteen (14) days
after the Request, either party may request the American Arbitration
Association or its successor ("AAA") to serve as the Neutral or to select the
Neutral or may require both parties to submit to any procedures of AAA to
select the Neutral, including without limitation the selection of AAA as the
Neutral. In order to resolve the Dispute, the parties shall develop a
non-binding alternative dispute resolution procedure such as mediation or
facilitation (the "Mediation") with the assistance of the Neutral. The Neutral
shall make the decision as to how, when and where the Mediation will be
conducted if the parties have been unable to agree on such matters by the
earlier of seven (7) Business Days after the appointment of the Neutral or
twenty-one (21) days after the Request. The parties shall participate in good
faith in the Mediation to its conclusion. If the parties resolve their Dispute
through their own negotiations or in the Mediation, the resolution shall be
reduced to the form of a written settlement agreement which shall be binding
upon both parties and shall preclude any litigation with respect to such
Dispute. If the parties have not resolved the Dispute through the Mediation
within sixty (60) days after the Request, then at any time thereafter, and
prior to resolution of the Dispute by the Mediation, upon written demand by
either party, the Mediation shall cease, and the Dispute shall be submitted to
arbitration (the "Arbitration") for resolution by an arbitrator or a panel of
arbitrators whose number shall be determined and who shall be selected in
accordance with the rules of the AAA. Arbitration shall be conducted in
accordance with the rules of the AAA. If Arbitration results in a
determination by the arbitrator(s) that an Event of Default has occurred, the
provisions of Article XVII shall govern the damages and other remedies which
may be implemented or ordered by the arbitrator(s). Neither the requirement to
utilize nor the pendency of any ADR procedures shall in any way invalidate any
notices or extend any cure periods applicable to an Event of Default as
provided in Article XVII. Except as expressly provided elsewhere in this
Agreement, these ADR procedures require the County and the Operator to use
these ADR procedures exclusively rather than litigation as a means of resolving
their disputes under this Agreement or to determine the consequences of an
Event of Default and the implementation of the remedies therefor as provided in
Article XVII. Notwithstanding any other provision of this Article to the
contrary, in the event a party may wish to seek interim relief, whether
affirmative or prohibitive, in the form of a temporary restraining order or
preliminary injunction or other interim equitable relief concerning a Dispute
including without limitation, declaratory relief, specific performance,
provisional remedies, special
49
action relief, stay proceedings in connection with special action relief or any
similar relief of an interim nature, either before beginning or at any point in
the ADR procedures concerning such Dispute, such party may initiate the
appropriate litigation to obtain such relief ("Equitable Litigation"). Nothing
herein shall be construed to suspend or terminate the obligation of both
parties promptly to proceed with the ADR procedures concerning the Dispute that
is the subject of such Equitable Litigation while such Equitable Litigation and
any appeal therefrom is pending. Regardless of whether such interim relief is
granted or denied or such Equitable Litigation is pending or any appeal is
taken from the grant or denial of such relief, at all times the parties shall
diligently proceed to complete the ADR procedures. Any interim or appellate
relief granted in such Equitable Litigation shall remain in effect until, and
only until, the ADR procedures concerning the Dispute that is the subject of
such Equitable Litigation result in a settlement agreement or the issuance of
an Arbitration award. Such written settlement agreement or award shall be the
binding, final determination on the merits of the Dispute (including but not
limited to any equitable relief and monetary damages but excluding any award of
attorneys' fees or costs rendered in the Equitable Litigation), shall supersede
and nullify any decision in the Equitable Litigation on the merits of the
dispute that is the subject of such Equitable Litigation, and shall preclude
any subsequent litigation on such merits, notwithstanding any determination to
the contrary in connection with any Equitable Litigation granting or denying
interim relief or any appeal therefrom. The parties agree that any disputes
which arise out of such a written settlement agreement or award during the term
of this Agreement shall be resolved exclusively by the procedures set forth in
this Article, provided that any party may institute legal proceedings in a
court of competent jurisdiction to enforce judgment upon an Arbitration award
in accordance with applicable law. The fees and costs of the Neutral and AAA
in the Mediation shall be borne equally by the parties; provided, however, that
the prevailing party in Arbitration shall be entitled to recover from the other
party's own assets and not from Facility Operating Revenue, in addition to any
other remedy, reimbursement for any costs of such proceeding, reasonable
attorneys' fees, reasonable costs of investigation and any other expenses
incurred in connection with such Arbitration or the Mediation of the Dispute
that is the subject of such Arbitration. Any recovered costs and expenses in
such Arbitration shall not be included as Facility Operating Expenses or paid
from Facility Operating Revenue.
ARTICLE XVIII
GENERAL PROVISIONS
18.1 Notice. All notices and other communications pursuant
to this Agreement shall be in writing and shall be deemed properly given upon
delivery, or refusal of delivery, if sent by personal delivery, overnight
courier service with guaranteed next day delivery or by certified United States
mail, postage prepaid, return receipt requested addressed as follows:
County Administrator
Broward County, Florida
115 S. Andrews Avenue, Room ___
Ft. Lauderdale, Florida 33301
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with copy to:
Director, Department of Finance
and Administrative Services
115 S. Andrews Avenue, Room 121
Fort Lauderdale, Florida 33301
with copy to:
The County Attorney
115 S. Andrews Avenue, Room 423
Fort Lauderdale, Florida 33301
To the Operator:
Arena Operating Company, Ltd.
c/o Huizenga Holdings, Inc.
200 South Andrews Ave., Sixth Floor
Ft. Lauderdale, FL 33301
with copy to:
Akerman, Senterfitt & Eidson, P.A.
SunTrust International Center
One S.E. Third Avenue, 28th Floor
Miami, Florida 33131-1704
with copy to:
Leisure Management International
Eleven Greenway Plaza
Suite 3000
Houston, Texas 77046
Attn: President
Each party may by notice to the other specify a different address for
subsequent notice purposes.
18.2 Time of Essence. Time is of the essence with respect to
the performance of each of the covenants and obligations contained in this
Agreement.
18.3 Relationship of Parties. No partnership, joint venture
landlord-tenant or other business relationship is established between the County
and the Operator under this Agreement or any other agreement referred to in this
Agreement other than the relationship of the County as the
51
owner of the Facility and the Operator as an independent contractor of the
County. Except as expressly provided in the Agreement, the Operator, its
employees, agents, independent contractors and licensees shall not be
considered employees or agents of the County or to have been authorized to
incur any expense on behalf of the County or to act for or to bind the County.
The County, its elected officials, officers, employees, agents and independent
contractors shall not be considered employees or agents of the Operator or to
have been authorized to incur any expense on behalf of the Operator or to act
for or to bind the Operator. Neither the County nor the Operator shall be
liable for any acts, omissions or negligence on the part of the other party,
its employees, agents, independent contractors and licensees resulting in
either personal injury or property damages. The relationship created hereby is
solely that of owner-independent contractor.
18.4 Severability. If any provision of this Agreement shall
be adjudged invalid or unenforceable by a court of competent jurisdiction, the
remaining provisions of this Agreement shall not be affected thereby and shall
be valid and enforceable to the fullest extent permitted by law, provided that
no such severance shall serve to deprive any of the parties of the enjoyment of
its substantial benefits under this Agreement.
18.5 Force Majeure. Failure in performance by either party
hereunder shall not be deemed an Event of Default and the non-occurrence of any
condition hereunder shall not give rise to any right otherwise provided herein
when such failure or non-occurrence is due to war; insurrection; strikes;
lock-outs; riots; floods; windstorms; fires; acts of God; acts of the public
enemy; epidemics; quarantine restrictions; freight embargos; lack of
transportation; governmental restrictions; unusually severe weather; inability
(when both parties are faultless) of any contractor, subcontractor or supplier;
acts or the failure to act, of any public or governmental agency or entity
(except acts or failures to act by the County) or any other causes beyond the
control and without the fault of the party claiming an extension of time to
perform. An extension of time for any such cause shall be limited to the period
of delay due to such cause, which period shall be deemed to commence from the
time of the commencement of the cause, provided that, if notice by the party
claiming such extension is sent to the other party more than thirty (30) days
after the commencement of the cause, the period shall be deemed to commence
thirty (30) days prior to the giving of such notice. The period of the delay
due to any such cause, shall be an Abatement Period. Times of performance under
this Agreement may also be extended as mutually agreed upon in writing by the
County and the Operator. However, failure to agree to a proposed extension of
time for performance shall not be deemed grounds for delay or failure to timely
cure an Event of Default hereunder.
18.6 Interpretations. To the extent permitted by the context
in which used, (a) words in the singular number shall include the plural, words
in the masculine gender shall include the feminine and neuter, and vice versa,
and (b) reference to "persons" or "parties" in this Agreement shall be deemed to
refer to natural persons, corporations, general partnerships, limited
partnerships, trusts and other entities.
52
18.7 Binding Effect. This Agreement, and the terms,
provisions, promises, covenants and conditions hereof, shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
legal representatives, successors and assigns.
18.8 Captions. Captions and paragraph headings used herein
are for convenience only and are not a part of this Agreement and shall not be
deemed to limit or alter any provisions hereof and shall not be deemed relevant
in construing this Agreement.
18.9 Entire Agreement. This Agreement is executed in seven
(7) duplicates each of which is deemed to be an original. This Agreement and
the referenced Exhibits, each of which is incorporated herein, together with the
other Agreements that constitute the Related Agreements to the extent
applicable, constitutes the entire understanding and agreement of the parties
with respect to the subject matter of this Agreement. This Agreement integrates
all of the terms and conditions mentioned herein or incidental hereto and
supersedes all negotiations or previous agreements between the parties with
respect to all or any part of the subject matter hereof.
18.10 Amendment. Except as otherwise provided herein, all
waivers of the provisions of this Agreement must be in writing and signed by the
County Representative or the Operator Representative. This Agreement may not be
changed, modified or rescinded except in writing by the County Representative
and the Operator Representative, and any attempt at oral modification of this
Agreement shall be void and of no effect. The Operator and County shall make
such changes to this Agreement as may be necessary to implement the Plan of
Finance attached to the Development Agreement as Exhibit "C".
18.11 Waiver. From time to time during the Term or any
Extension Term, the Operator Representative, in its discretion, shall have the
right, power and authority to waive any non-material, non-economic, performance,
duty, right or benefit due Operator or County under this Agreement.
18.12 Applicable Law. The laws of the State of Florida shall
govern the interpretation and enforcement of this Agreement.
18.13 Nondiscrimination. There shall be no discrimination
against or segregation of any person, or group of persons, on account of sex,
marital status, race, color, creed, religion, national origin or ancestry in the
sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the
Project Site or the Facility. Neither the Operator nor any person claiming
under or through it shall establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
use or occupancy of licensees, sublicensees or vendors using or operating at the
Project Site or Facility or any portion thereof.
18.14 Reasonableness. Whenever in this Agreement the consent
or approval of the County or the Operator is required, unless expressly stated
to the contrary, the granting of such consent or approval shall be governed by a
standard of reasonableness. If either party contends that the standard has not
been met, the matter shall be resolved as provided in Article XVIII. In the
event
53
that such resolution results in the determination that the action was
unreasonable, such determination shall not constitute a default of this
Agreement, operate to terminate it or give rise to any right to damages as a
result thereof, but the sole remedy shall be limited to specific performance and
the recovery of reasonable attorneys' fees and costs (including the fee of the
arbitrators) in such resolution procedure.
ARTICLE XIX
LIABILITY LIMITATION
19.1 County and Operator Personnel. Notwithstanding and
prevailing over any contrary provision or implication in this Agreement, no
member, elected official, official, employee, agent, or consultant of the County
or limited partner, shareholder of partner, officer, employee or agent of the
Operator shall be liable to either of the parties hereto, or any successors in
interest thereof, in the event of any default or breach by the County or
Operator, for any amount which may become due to either party or any successors
in interest thereof, or on any other obligation under the terms of this
Agreement, except any such obligations which result from their criminal acts
with respect hereto (i.e., acts which would constitute crimes were they
prosecuted therefor and convicted thereof).
[Signatures on following page]
54
IN WITNESS WHEREOF, the parties have hereunto executed this Agreement
by and through their lawfully authorized officers, this 4th day of June, 1996.
ATTEST: COUNTY:
/s/ B. Jack Osterholt
----------------------------- BROWARD COUNTY, FLORIDA
County Administrator
By: John E. Rodstrom
-----------------------------
Chair of the Board of County
Commissioners
OPERATOR:
ARENA OPERATING COMPANY, LTD.
By: Arena Operating Company
Inc., a Florida corporation, its
General Partner
By: /s/ H. Wayne Huizenga
-------------------------------
Name: H. Wayne Huizenga
-----------------------------
Title: Chairman
----------------------------
APPROVED AS TO FORM:
/s/ Noel Pfeffer
------------------------------
County Attorney
55
EXHIBIT "4.16"
MBE/WBE PROGRAM
1. Operator will use good faith efforts to cause minority owned
(MBE) and women owned (WBE) business enterprises to be engaged in the operation
of the Facility at least up to the levels of the Operation Goals described
below.
2. Operator has established the following participation
percentages in its operational goals (the "Operational Goals"):
[Download Table]
(a) MBE
African American 10%
Hispanic 10%
Asian and/or Native American 3%
(b) WBE 7%
3. The Operation Goals are percentages of the total amounts
expected to be paid to all companies for supplying supplies, services, food,
beverages, novelties and notions and other concessions (other than those
available from limited sources or suppliers) for items to be sold at and during
the operation of the Facility, but may not necessarily be achieved in each
category.
4. (a) Women's Business Enterprise or WBE. A business which
is:
(1) A sole proprietorship, owned and controlled
by a woman;
(2) A partnership or joint venture controlled by
women in which at least 51% of the beneficial ownership interest is held by
women;
56
(3) A corporation or other entity controlled by
women in which at least 51% of the interest in such corporation or entity is
beneficially owned by women.
(b) Minority Business Enterprise or MBE. A business
which is:
(1) A sole proprietorship, owned and controlled
by a minority person;
(2) A partnership or joint venture controlled by
minority persons in which at least 51% of the beneficial ownership interest is
held by minority persons;
(3) A corporation or other entity controlled by
minority persons in which at least 51% of the interest in such corporation or
entity is beneficially owned by minority persons.
(c) Minority Person. A person who is an Asian American,
Black American, Hispanic American, or Native American.
5. Operator will cooperate with the County MBE/WBE agency
addressing MBE/WBE issues and other public spirited organizations addressing
such issues in its efforts to achieve the Operation Goals.
6. Operator shall not be required to engage MBE's or WBE's who
are not the lowest responsible bidders.
57
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-1’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 9/18/96 | | | | | | | None on these Dates |
| | 6/4/96 | | 1 | | 7 |
| | 4/2/96 | | 7 |
| List all Filings |
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