AG 18-088 - SPECTRA VENUE MANAGEMENT RETURN TO: EXT:
CITY OF FEDERAL WAY LAW DEPARTMENT ROUTING FORM
. ORIGINATING DEPT./DIV: LAW
. ORIGINATING STAFF PERSON: RYAN CALL EXT: 3. DATE REQ.BY:
TYPE OF DOCUMENT(CHECK ONE):
❑ CONTRACTOR SELECTION DOCUMENT(E.G.,RFB,RFP,RFQ)
❑ PUBLIC WORKS CONTRACT ❑ SMALL OR LIMITED PUBLIC WORKS CONTRACT
❑ PROFESSIONAL SERVICE AGREEMENT ❑ MAINTENANCE AGREEMENT
❑ GOODS AND SERVICE AGREEMENT ❑ HUMAN SERVICES/CDBG
❑ REAL ESTATE DOCUMENT ❑ SECURITY DOCUMENT(E.G.BOND RELATED DOCUMENTS)
❑ ORDINANCE ❑ RESOLUTION
LI CONTRACT AMENDMENT(AG#):_ ❑ INTERLOCAL
❑ OTHER
. PROJECT NAME: PAEC MANAGEMENT CONTRACT
. NAME OF CONTRACTOR: GLOBAL SPECTRUM,L.P.D/B/A SPECTRA VENUE MANAGEMENT
ADDRESS:_SEE CONTRACT TELEPHONE
E-MAIL: FAX:
SIGNATURE NAME: TITLE
EXHIBITS AND ATTACHMENTS:❑ SCOPE,WORK OR SERVICES ❑ COMPENSATION ❑ INSURANCE REQUIREMENTS/CERTIFICATE ❑ ALL
OTHER REFERENCED EXHIBITS ❑ PROOF OF AUTHORITY TO SIGN ❑ REQUIRED LICENSES ❑ PRIOR CONTRACT/AMENDMENTS
TERM: COMMENCEMENT DATE: AUG 1,2018 COMPLETION DATE: DEC 31,2023
TOTAL COMPENSATION$ (INCLUDE EXPENSES AND SALES TAX,IF ANY)
(IF CALCULATED ON HOURLY LABOR CHARGE-ATTACH SCHEDULES OF EMPLOYEES TITLES AND HOLIDAY RATES)
REIMBURSABLE EXPENSE:❑YES ❑NO 1F YES,MAXIMUM DOLLAR AMOUNT: $
IS SALES TAX OWED ❑YES ❑NO IF YES,$ PAID BY:❑CONTRACTOR❑CITY
RETAINAGE: RETAINAGE AMOUNT: ❑RETAINAGE AGREEMENT(SEE CONTRACT) OR ❑RETAINAGE BOND PROVIDE
❑ PURCHASING: PLEASE CHARGE TO:
0. DOCUMENT/CONTRACT REVIEW INITIAL/DATE REVIEWED INITIAL/DATE APPROVED
❑ PROJECT MANAGER
❑ DIRECTOR
❑ RISK MANAGEMENT (IF APPLICABLE)
111 LAW W1S
1. COUNCIL APPROVAL(IF APPLICABLE) SCHEDULED COMMITTEE DATE: 1 COMMITTEE APPROVAL DATE: Iv
SCHEDULED COUNCIL DATE: _OV1II'I COUNCIL APPROVAL DATE:
2. CONTRACT SIGNATURE ROUTING
❑ SENT TO VENDOR/CONTRACTOR DATE SENT: DATE REC'D:
❑ ATTACH: SIGNATURE AUTHORITY, INSURANCE CERTIFICATE, LICENSES, EXHIBITS
❑ CREATE ELECTRONIC REMINDER/NOTIFICATION FOR 1 MONTH PRIOR TO EXPIRATION DATE
(Include dept.support staff if necessary and feel free to set notification more than a month in advance if council approval is needed.)
INI IAL/DATE IGNED
,-L7I":)A,W DEPARTMENT " ' b
ATORY(MAYOR OR DIRECTOR) � �1 I
grCITY CLERK / 7WrIgir
/SSSIGNED AG# AG# # �:
IGNED COPY RETURNED DATE SENT:
:OMMENTS:
IOMR
MANAGEMENT AGREEMENT
between
CITY OF FEDERAL WAY,WASHINGTON
and
GLOBAL SPECTRUM,L.P.
d/b/a SPECTRA VENUE MANAGEMENT
Effective: As of August 1,2018
MANAGEMENT SERVICES AGREEMENT - 1 - 8/2018
MANAGEMENT AGREEMENT
This Management Agreement is entered into on June ,2018 and made effective as of August 1,2018
("Effective Date"),by and between the City of Federal Way,Washington,a Washington State municipal corporation
("City"),and Global Spectrum,LP,a Delaware limited partnership d/b/a Spectra Venue Management("Manager").
RECITALS
WHEREAS, City owns the Performing Arts and Events Center of Federal Way ("PAEC"), a 716 seat
performing arts center, approximately 8,400 square feet event space, kitchen, and associated office space (the
"Facility"), located in Federal Way, Washington;
WHEREAS,the City has the right and authority to engage Manager to manage and operate the Facility;
WHEREAS, the City desires to engage Manager to manage and operate the Facility on behalf and for the
benefit of the City,and Manager desires to accept such engagement,pursuant to the terms and conditions contained
herein;and
NOW THEREFORE, for and in consideration of the foregoing, the mutual covenants and promises
hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged,the parties, intending to be legally bound, hereby agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1. Definitions. For purposes of this Agreement,the following terms have the meanings referred
to in this Section:
Affiliate: A person or company that directly or indirectly,through one or more intermediaries,controls or is
controlled by, or is under common control with, a specified person or company.
Capital Expenditures:All expenditures for building additions,alterations,repairs or improvements and for
purchases of additional or replacement furniture, machinery, or equipment, where the cost of such expenditure is
greater than $5,000 and the depreciable life of the applicable item is, according to generally accepted accounting
principles, in excess of five(5)years.
Commercial Rights: Naming rights, pouring rights, advertising, sponsorships, the branding of food and
beverage products for resale,premium seating(including suites,club seats and party suites),and memorial gifts at or
with respect to the Facility.
Contribution: shall have the meaning given to such term in Section 11.3 herein.
CPI: The"Consumer Price Index"for the local Federal Way, Washington area,as published by the United
States Department of Labor, Bureau of Labor Statistics or such other successor or similar index.
Effective Date: shall have the meaning given to such term in the opening paragraph of this Agreement.
Emergency Repair: The repair of a condition which, if not performed immediately,creates an imminent
danger to persons or property and/or an unsafe condition at one or both of the Facility threatening persons or property.
MANAGEMENT SERVICES AGREEMENT -2- 8/2018
Event Account:A separate interest-bearing account in the name of the City and under the City's Federal ID
number in a local qualified public depository, to be designated by the City, where advance ticket sale revenue is
deposited by Manager.
Event of Force Majeure: An act of God,fire,earthquake,hurricane,flood,riot,civil commotion,terrorist
act,terrorist threat,storm,washout,wind, lightning,landslide,explosion,epidemic,inability to obtain materials or
supplies,accident to machinery or equipment,any law,ordinance,rule,regulation,or order of any public or military
authority stemming from the existence of economic or energy controls, hostilities or war, a labor dispute which
results in a strike or work stoppage affecting the Facility or services described in this Agreement,or any other cause
or occurrence outside the reasonable control of the party claiming an inability to perform and which by the exercise of
due diligence could not be reasonably prevented or overcome.
Existing Contracts: Service Contracts,Revenue Generating Contracts,and other agreements relating to the
day-to-day operation of either or both of the Facility existing as of the Effective Date, as set forth on Exhibit B
attached hereto.
Facility:shall have the meaning given to such term in the Recitals to this Agreement,and shall be deemed to
include the entire PAEC (theater and event spaces), including but not limited to, as applicable, the seating areas,
dressing rooms,meeting rooms,box office,common areas,kitchen areas,lobby areas,executive and other offices,
storage and utility facilities,the entrances,ground,sidewalks and parking areas immediately surrounding the Facility,
, and outdoor areas,all as specifically identified on Schedule 1 hereto.
FF&E: Furniture, fixtures, and equipment to be procured for use at the Facility.
Fixed Management Fee:The fixed monthly fee the City shall pay to Manager under this Agreement,as more
fully described in Section 3.1 of this Agreement.
General Manager:The employee of Manager acting as the full-time on-site general manager of the Facility.
Incentive Fee: The contingent fee the City shall pay to Manager under this Agreement, if earned,as more
fully described in Section 3.2 below.
Initial Term: "Term"shall have the meaning given in Section 4.1 of this Agreement.
Laws: federal, state, local and municipal laws, statutes,rules,regulations and ordinances.
Management-Level Employees:The General Manager,Assistant General Manager,Business Manager,and
Food and Beverage Manager(or employees with different titles performing similar functions),and any department
head employed by Manager to perform services at the Facility(including, if applicable,employees performing the
function of the Director of Operations,Director of Sales and Marketing,Director of Security,Finance Director,and
Event Manager).
Marketing Plan: A plan for the advertising and promotion of the Facility and Facility events, which may
contain but not be limited to the following elements, as applicable: (i) market research, (ii) market position, (iii)
marketing objectives,(iv)marketing strategies,(v)booking priorities,(vi)targeted events-local,regional,national
and international, (vii) targeted meetings, conventions and trade shows, (viii) industry advertising campaign, (ix)
internal and external support staff, (x) advertising opportunities at the local, regional and national level, (xi)
attendance at various trade shows,conventions and seminars,(xii)incentive formulas for multiple event presenters,
(xiii) suite and club seat sales, (xiv)merchandising and retail, (xv) food and beverage, (xvi) a plan for the sale of
MANAGEMENT SERVICES AGREEMENT -3- 8/2018
commercial rights, including without limitation naming rights, pouring rights, advertising signage, sponsorships
(including event sponsorships),branding of food and beverage products for resale,premium seating(including but
not limited to suites and club seats), and memorial gifts,(xvii)a plan regarding national,regional and local public
relations and media relations,(xviii)development of an in-house advertising agency,and(xix)policies regarding the
use of trade/barter.
Net Operating Income/Loss: shall mean the amount by which Revenue at the Facility exceeds Operating
Expenses at the Facility,resulting in Net Operating Income,or by which Operating Expenses at the Facility exceeds
Revenue at the Facility, resulting in Net Operating Loss, for the period in question.
Net Operating Income/Loss Benchmark: shall be mutually agreed on prior to February 28, 2019 and
confirmed in writing. If for any reason the parties are unable to mutually agree on such figure prior to such date,the
parties shall submit such determination to a mutually agreed upon third-party arbitrator who shall be an independent
industry expert, without any conflicts of interest. City and Manager shall each submit to such third party their
proposed figure for the Net Operating Income/Loss Benchmark,and such third parties' determination shall be final
and binding on the City and Manager,provided that such determination shall be made consistent with the terms of
this Agreement,and shall not be outside of the range of the figures submitted by the City and Manager.The cost of
such third party arbitrator shall be shared equally between the parties.
Operating Account:A separate interest-bearing account in the name of the City and under the City's Federal
ID number in a local qualified public depository,to be designated by the City,where Revenue is deposited and from
which Operating Expenses are paid.
Operating Budget:A line item budget for the Facility that includes a projection of Revenues and Operating
Expenses,presented on a monthly and annual basis.
Operating Expenses: All expenses incurred by Manager in connection with its operation, promotion,
maintenance and management of the Facility, including but not limited to the following: (i) employee payroll,
benefits,relocation costs,severance costs,bonus and related costs,(ii)cost of operating supplies,including general
office supplies, (iii) advertising, marketing, group sales, and public relations costs, (iv) cleaning and landscaping
expenses,(v)data processing costs,(vi)dues,subscriptions and membership costs,(vii)the Fixed Management Fee,
(viii) printing and stationary costs, (ix) postage and freight costs, (x) equipment rental costs, (xi) minor repairs,
maintenance, and equipment servicing, not including expenses relating to performing capital improvements or
repairs,(xii)security expenses,(xiii)telephone and communication charges,(xiv)travel and entertainment expenses
of Manager employees, (xv) cost of employee uniforms and identification, (xvi) exterminator, snow and trash
removal costs, if applicable (xvii)computer, software, hardware and training costs, (xviii) parking expenses,(xix)
utility expenses, (xx) office expenses, (xxi) ) audit and accounting fees, (xxii) legal fees, (xxiii) all bond and
insurance costs,including but not limited to personal property,liability,and worker's compensation insurance,(xxiv)
commissions and all other fees payable to third parties;(xxv)cost of complying with any Laws,(xxvi)costs incurred
by Manager to settle or defend any claims asserted against Manager arising out of its operations at the Facility on
behalf of City; (xxvii) amount of any deductible or self-insured retention under insurance policies; (xxviii) costs
incurred under Service Contracts and other agreements relating to Facility' operations, (xxix) all costs relating to
provision of the Food and Beverage Services,including labor,cost of goods,and cost of permits/licenses;and(xxx)
Taxes.
The term"Operating Expenses"does not include debt service on the Facility,Capital Expenditures,Transition
Costs,property taxes,insurance on the Facility of contents within the Facility owned by City,or the Incentive Fee,all
of which costs shall be borne by the City.
MANAGEMENT SERVICES AGREEMENT -4- 8/2018
Operating Year: Each twelve(12)month period during the Term,commencing on January 1 and ending on
the following December 31, except that the first(1S`)Operating Year shall be a shorter period,commencing on the
Effective Date and ending on December 31,2018.
Operations Manual: Document to be developed by Manager that shall contain terms regarding the
management and operation of the Facility,including detailed policies and procedures to be implemented in operating
the Facility, as agreed upon by both the City and the Manager.
Revenue: All revenues generated by Manager's operation of the Facility, including but not limited to event
ticket proceeds income,rental and license fee income,merchandise income,gross food and beverage income,gross
income from any sale of Commercial Rights, gross service income, equipment rental fees, box office income, and
miscellaneous operating income,but shall not include event ticket proceeds held by Manager in trust for a third party
and paid to such third party.
Revenue Generating Contracts: Vendor, concessions and merchandising agreements, user/rental
agreements,booking commitments,licenses,and all other contracts or agreements generating revenue for the Facility
and entered into in the ordinary course of operating the Facility.
Service Contracts: Agreements for services to be provided in connection with the operation of the Facility,
including without limitation agreements for ticketing,web development and maintenance,computer support services,
FF&E purchasing services, engineering services, electricity, steam, gas, fuel, general maintenance, HVAC
maintenance,telephone,staffing personnel including guards,ushers and ticket-takers,extermination,elevators,stage
equipment, fire control panel and other safety equipment, snow removal, and other services that are deemed by
Manager to be either necessary or useful in operating the Facility.
Taxes:Any and all governmental assessments,franchise fees,excises,license and permit fees,levies,charges
and taxes, of every kind and nature whatsoever, which at any time during the Term may be assessed, levied, or
imposed on,or become due and payable out of or in respect of, (i)activities conducted on behalf of the City at the
Facility,including without limitation the sale of concessions,the sale of tickets,and the performance of events(such
as any applicable sales and/or admissions taxes, use taxes, excise taxes, occupancy taxes, employment taxes, and
withholding taxes), or (ii) any payments received from any holders of a leasehold interest or license in or to the
Facility, from any guests, or from any others using or occupying all or any part of the Facility.
Term: shall have the meaning ascribed to such term in Section 4.1 of this Agreement.
Transition Budget: shall mean the budget reflecting anticipated Transition Costs attached hereto as
Exhibit E.
Transition Costs: shall mean the out-of-pocket costs incurred,or to be incurred, by Manager in
connection with its activities related to the transition of management of the Facility to Manager, as set forth in
the Transition Budget.
ARTICLE 2
SCOPE OF SERVICES
Section 2.1 Engagement.
(a) City hereby engages Manager during the Term to act as the sole and exclusive manager and
operator of the Facility, subject to and as more fully described in this Agreement and, in connection therewith, to
MANAGEMENT SERVICES AGREEMENT -5- 8/2018
perform the services described in Exhibit A attached hereto.
(b) Manager hereby accepts such engagement, and shall perform the services described herein,
subject to the limitations expressly set forth in this Agreement and in the Operations Manual.
Section 2.2 Limitations on Manager's Duties. Manager's obligations under this Agreement are contingent
upon and subject to the City making available, in a timely fashion,the funds budgeted for and/or reasonably required
by Manager to carry out such obligations during the Term. Manager shall not be considered to be in breach or default
of this Agreement,and shall have no liability to the City or any other party, in the event Manager does not perform
any of its obligations hereunder due to failure by the City to timely provide such funds.
Section 2.3 Standard of Care. Subject to the limitations of the Operating Budget,Manager shall exercise
reasonable commercial, good faith efforts in managing and operating the Facility so as to minimize Operating
Expenses and maximize Operating Revenues, provided that Manager shall be permitted to book events at no or
reduced rental fees as required and approved by the City pursuant to the terms of Section 5.4.
Section 2.4 Duty. Manager shall owe to the City 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 and in a manner
that is in the best interests of the Facility and the City and consistent with the terms of this Agreement.Manager shall
not engage in any act that not within the scope of its authority under this Agreement,that is not in good faith or from
which the Manager derives an improper personal benefit.
ARTICLE 3
COMPENSATION
Section 3.1 Fixed Management Fee. In consideration of Manager's performance of its services hereunder,
City shall pay Manager a Fixed Management Fee.Beginning on the Effective Date and continuing through December
31, 2019, the Fixed Management Fee shall be Six Thousand Two Hundred Fifty Dollars ($6,250.00) per month.
From January 1,2020 to December 31,2020,the Fixed Management Fee shall be reduced to Five Thousand Dollars
($5,000) per month. Beginning on January 1, 2021 and continuing on each succeeding January 1, the Fixed
Management Fee shall be increased in accordance with the percentage increase in the CPI-U over the previous twelve
(12) month period (i.e., the difference, expressed as a percentage, between the value of the CPI-U published most
recently prior to the commencement of the preceding Operating Year and the value of the CPI-U published most
recently prior to the commencement of the Operating Year for which the CPI-U adjustment will apply). The Fixed
Management Fee shall be payable to Manager in advance, beginning on the Effective Date, and payable on the first
(1°) day of each month thereafter(prorated as necessary for any partial months). Manager shall be entitled to pay
itself such amount from the Operating Account.
Section 3.2 Incentive Fee. In addition to the Fixed Management Fee,Manager shall be entitled to
receive an Incentive Fee each full or partial Operating Year of the Term(except that for the period from the Effective
Date until December 31,2019,Manager shall be eligible only for the Qualitative Component of the Incentive Fee).
The Incentive Fee shall be comprised of a qualitative component as described in subpart (a) below("Qualitative
Component") and a quantitative component as described in subpart(b)below("Quantitative Component").
(a) Oualitative Component. Manager shall be eligible to earn up to ten thousand dollars($10,000)
in each Operating Year(pro-rated for any Operating Years of less than a full 12 months based on the actual number
of days elapsed in such Operating Year out of 365). The Qualitative Component shall be determined by the City,in
its reasonable and good faith discretion based on its evaluation of Manager's performance each Operating Year in
each of the following five(5) performance areas (with each area equal to up to $2,000):
MANAGEMENT SERVICES AGREEMENT -6- 8/2018
- Results of Customer Survey scores
Tenant/Resident Group Relations
Quality of Food and Beverage Services
Achievement of Annual Event Programming and Attendance Goals in the theater
space
Achievement of Annual Event Programming and Attendance Goals in the events space
(b) Quantitative Component. Beginning with the third(3`d)Operating Year(i.e.,January 1,2020—
December 31,2020)Manager shall be paid twenty percent(20%)of the amount by which the actual Net Operating
Income/Loss in each Operating Year exceeds the Net Operating Income/Loss Benchmark.For any Operating Years of
less than a full 12-months,the Net Operating Income/Loss Benchmark shall be prorated based on the actual number
of days elapsed in such Operating Year out of 365. There shall be no cap or maximum limit on the amount of the
Quantitative Fee earnable by Manager.
The Incentive Fee earned by Manager shall be paid to Manager no later than ninety (90) days
following the end of each Operating Year.
the other fees due Manager hereunder,the
addition to City
Section 3.3 Commercial Rights Fee.In $
»
e (15%)of the Revenue from Commercial Rights("Commercial Rights Fee"),as set
shall pay Manager fifteen percent g
forth below.For the sake of clarity,the parties acknowledge that the Commercial Rights Fee shall be paid on all gross
revenue from the sale of advertising signage,sponsorships,naming/title rights,sub-naming/title rights,pouring rights,
branding rights,and other Commercial Rights at the Facility.For purposes of this paragraph,Revenue shall include
trade/barter,with such trade/barter valued at its retail price in an arms-length transaction.The Commercial Rights Fee
shall be paid for the full duration of all contracts for such Commercial Rights,including any period that extends after
the end of this Agreement. Notwithstanding the foregoing,the Commercial Rights Fee shall not be paid on Revenue
from Commercial Rights secured prior to the Effective Date. Payments due under this paragraph shall be made to
Manager on an annual basis, within sixty (60) days of the end of each Operating Year, with respect to Revenue
received in that year from the applicable Commercial Rights contracts.The provisions of this paragraph shall survive
expiration or termination of this Agreement,and such settlements shall continue on an annual basis following the end
of the term with respect to Revenue from Commercial Rights received in such years until such time as all
Commercial Rights Commissions due Manager under this paragraph are fully paid. Manager shall engage one (1)
person to serve as an on-site sales person, the costs of whom shall be considered an Operating Expense of the
Facility.
Section 3.4 Transition Costs.Promptly following the Effective Date(or prior to the Effective Date,
as applicable), Manager shall do all things reasonably necessary to transition from the current management of the
Facility to the commencement of its management services hereunder. The City shall reimburse Manager for the
Transition Costs, in accordance with the Transition Budget. Manager shall invoice the City for such costs,and the
City shall pay such costs within thirty(30)days of its receipt of each such invoice.Each invoice provided by Manager
shall be accompanied by reasonable back-up documentation evidencing the incurrence of the Transition Costs.
Section 3.5 Late Payments. Manager shall have the right to assess interest on any payments of the
fees described in this Section that are not made when due. Such interest shall accrue at the rate of twelve percent
(12%)per annum.
ARTICLE 4
TERM; TERMINATION
Section 4.1 Term. The initial term of this Agreement (the"Initial Term") shall begin on the Effective
Date,and,unless sooner terminated pursuant to the provisions of Section 4.2 below,shall expire on December 31,
MANAGEMENT SERVICES AGREEMENT -7- 8/2018
2023. Following the Initial Term, the City may extend this Agreement for an additional five (5) years, to end on
December 31, 2028, by providing written notice of such extension to Manager no later than August 31,2023. The
Initial Term plus any such extension periods is referred to as the"Term"hereunder.
Section 4.2 Termination. This Agreement may be terminated:
(a) by either party upon thirty(30)days written notice,if the other party fails to perform or comply with
any of the material terms,covenants,agreements or conditions hereof,and such failure is not cured during such thirty
(30)day notification period,provided,however,if such failure cannot reasonably be cured within such thirty(30)day
period,then a longer period of time shall be afforded to cure such breach,up to a total of ninety(90)days,provided
that the party in default is diligently seeking a cure and the non-defaulting party is not irreparably harmed by the
extension of the cure period; or
(b) by either party immediately by written notice upon the other party being judged bankrupt or insolvent,
receiver or trustee of all or anypart of the businesspropertyof the othershall be appointed and shall
or if any party PP
not be discharged within one hundred twenty (120) days after appointment, or if either party shall make an
assignment of its property for the benefit of creditors or shall file a voluntary petition in bankruptcy or insolvency,or
shall apply for bankruptcy under the bankruptcy or insolvency Laws now in force or hereinafter enacted, Federal,
State or otherwise,or if such petition shall be filed against either party and shall not be dismissed within one hundred
twenty(120)days after such filing.
Section 4.3 Effect of Expiration or Termination
(a) Upon expiration or termination of this Agreement,the City shall reimburse Manager for any actual
ordinary and necessary expenses incurred by Manager in withdrawing from the provision of services hereunder
following such termination. Such ordinary and necessary expenses shall include costs associated with(i)severance
pay,not to exceed three(3)months, for each of Manager's Management-Level Employees who are not retained by
Manager following termination of this Agreement,(ii) reasonable household relocation expenses for Management-
Level Employees at the Facility who are retained by Manager following termination to work at another Manager-
managed Facility, but only to the extent any of such individuals had previously relocated to the Facility (or its
surrounding areas)in connection with this Agreement,and(iii) other reasonable costs actually incurred by Manager
in withdrawing from the provision of services hereunder,such as those incurred in connection with the termination
and/or assignment of Service Contracts,Revenue Generating Contracts,or other contracts or leases entered into by
Manager pursuant to this Agreement. The City's payment of such expenses will occur only after Manager has
provided reasonable evidence of the incurrence of such expenses.
(b) Also upon expiration or termination or this Agreement,the following shall apply: (i)Manager shall
promptly discontinue the performance of all services hereunder, (ii) City shall promptly pay Manager all fees due
Manager up to the date of termination or expiration(subject to proration if the Term ends other than at the end of the
Operating Year),(iii)City shall pay to Manager all Operating Expenses incurred by Manager through the end of the
Term that have not previously been paid, including costs of accrued but unused vacation time and other end of
employment payments due to Manager's employees whose employment is being terminated Manager,(iv)Manager
shall make available to the City all data,electronic files,documents,procedures,reports,estimates,summaries,and
other such information and materials with respect to the Facility as may have been accumulated by Manager in
performing its obligations hereunder,whether completed or in process,and(iv)without any further action on part of
Manager or City,the City shall,or shall cause the successor Facility manager to,assume all obligations arising after
the date of such termination or expiration, under any Service Contracts, Revenue Generating Contracts, booking
commitments and any other Facility agreements entered into by Manager in furtherance of its duties hereunder.Any
obligations of the parties that are specifically intended to survive expiration or termination of this Agreement shall
survive expiration or termination hereof.
MANAGEMENT SERVICES AGREEMENT -8- 8/2018
ARTICLE 5
OWNERSHIP; USE OF THE FACILITY
Section 5.1 Ownership of Facility, Data, Equipment and Materials. The City will at all times retain
ownership of the Facility, including but not limited to real estate,technical equipment,furniture,displays,fixtures
and similar property,including improvements made during the Term.Any data,equipment or materials furnished by
the City to Manager or acquired by Manager as an Operating Expense shall remain the property of the City,and shall
be returned to the City when no longer needed by Manager to perform under this Agreement. Notwithstanding the
above,City shall not have the right to use any third party software licensed by Manager for general use by Manager at
the Facility and other facilities managed by Manager, the licensing fee for which is proportionately allocated and
charged to the Facility as an Operating Expense; such software may be retained by Manager upon expiration or
termination hereof. Furthermore, the City recognizes that the Operations Manual to be developed and used by
Manager hereunder is proprietary to Manager,and shall belong to Manager at the end of the Term;City shall not use
or maintain copies thereof upon the end of the Term except as may be required by the Washington State Public
Records Act per Section 18.18 below.
Section 5.2 Right of Use by Manager. The City hereby gives Manager the right and license to use the
Facility,and Manager accepts such right of use,for the purpose of performing the services herein specified,including
the operation and maintenance of all physical and mechanical Facility necessary for,and related to,the operation,
maintenance and management of the Facility. The City shall provide Manager with a sufficient amount of suitable
office space in the Facility and with such office equipment as is reasonably necessary to enable Manager to perform
its obligations under this Agreement.In addition,the City shall make available to Manager,at no cost,parking spaces
adjacent to the Facility for all of Manager's full-time employees and for the Facility's event staff.The City will retain
the use of one(1) office with a door in the Facility for use by City staff.
Section 5.3 Observance of Agreements. The City agrees to pay,keep,observe and perform all payments,
terms, covenants, conditions and obligations under any leases, bonds, debentures, loans and other financing and
security agreements to which the City is bound in connection with its ownership of the Facility.
Section 5.4 Use by the City. Subject to availability,the City shall have the right to use the Facility or any
part thereof without paying rent for meetings,seminars,training classes or other non-commercial uses,provided that
the City shall promptly reimburse Manager,for deposit into the Operating Account,for any out-of-pocket expenses
incurred by Manager(such as the cost of ushers,ticket-takers,set-up and take-down personnel,security expenses and
other expenses) in connection with such use. Such non-commercial use of the Facility by the City shall (i)not
compete with or conflict with the dates previously booked by Manager for paying events,(ii)not consist of normally
touring attractions (such as concerts and family shows), and(iii) be booked in advance upon reasonable notice to
Manager pursuant to the Facility' approved booking policies. Upon request of the City,Manager shall provide to the
City a list of available dates for City use of the Facility. To the extent that Manager has an opportunity to book a
revenue-producing event on a date that is otherwise reserved for use by the City, Manager may propose alternative
dates for the City's event, and the City shall use best efforts to reschedule its event to allow Manager to book the
revenue-producing event, provided, that the City shall not be obligated to reschedule its event. For purposes of
calculating Manager's Incentive Fee, Manager shall receive a"paper"credit for an amount equal to the difference
between the published Facility rate and the rate (if any)charged to the City for such use of the Facility,when such
City use precludes rental of the facility to an available paying customer.
Section 5.5 Right of Ingress and Egress. Manager acknowledges that the City shall have the right to enter
the Facility and to grant to others the right of ingress and egress to and from the Facility for the purpose of inspection
thereof,the conduct of capital improvements,or other purposes.The City agrees to use reasonable commercial efforts
MANAGEMENT SERVICES AGREEMENT -9- 8/2018
to coordinate such entry with the Manager to minimize interference with scheduled activities at the Facility.
ARTICLE 6
PERSONNEL
Section 6.1 Generally.All Facility staff and other personnel shall be engaged or hired by Manager,and shall
be employees,agents or independent contractors of Manager(or an Affiliate thereof),and not of the City.Subject to
the remainder of this paragraph,Manager shall select,in its sole discretion but subject to City's right to approve the
Operating Budget, the number, function, qualifications, and compensation, including salary and benefits, of its
employees and shall control the terms and conditions of employment (including without limitation termination
thereof) relating to such employees. Manager agrees to use reasonable and prudent judgment in the selection and
supervision of such personnel.The City specifically agrees that Manager shall be entitled to pay its employees,as an
Operating Expense,bonuses and benefits in accordance with Manager's then current employee manual,which may be
modified by Manager from time to time in its sole discretion.A copy of Manager's current employee manual shall be
provided to the City upon request. City shall pay all accrued but unused vacation time to its employees whose
employment with City is terminating and whose employment with Manager is commencing.
Section 6.2 General Manager. Personnel engaged by Manager will include an individual with experience
managing facilities similar to the Facility to serve as a full-time on-site General Manager of the Facility.Hiring of the
General Manager by Manager shall require the prior approval of the City,which approval shall not be unreasonably
withheld or delayed; provided,however, in the event of a vacancy in the General Manager position,Manager may,
upon notice to the City, temporarily fill such position with an interim General Manager for up to ninety(90) days
without the necessity of obtaining the City's approval. The General Manager will have general supervisory
responsibility for Manager and will be responsible for day-to-day operations of the Facility, supervision of
employees,and management and coordination of all activities associated with events taking place at the Facility.
Section 6.3 Non-Solicitation/Non-Hiring. During the Term and for a period of one(1)year after the end of
the Term,neither City nor any of its Affiliates shall solicit for employment,or hire,any of Manager's Management-
Level Employees unless Management agrees to such solicitation or employment in writing.The City acknowledges
that Manager will spend a considerable amount of time identifying,hiring and training individuals to work in such
positions,and that Manager will suffer substantial damages,the exact amount of which would be difficult to quantify,
if the City were to breach the terms of this Section by hiring,or soliciting for employment,any of such individuals.
Accordingly,in the event of a breach or anticipated breach of this Section by the City,Manager shall be entitled(in
addition to any other rights and remedies which Manager may have at law or in equity,including money damages)to
equitable relief, including an injunction to enjoin and restrain the City from continuing such breach, without the
necessity of posting a bond.
ARTICLE 7
OPERATING BUDGET
Section 7.1 Establishment of Operating Budget.Attached hereto as Exhibit C is the Operating Budget for
the Facility for the first(1st)Operating Year(Effective Date through December 31,2018),which Operating Budget is
hereby approved by both Manager and City, provided that such Operating Budget shall be deemed amended to
include the cost of the fees due or to become due to Manager under Article 3 above for such period.Manager agrees
that at least 150 days prior to the commencement of each subsequent Operating Year in respect of such year,it will
prepare and submit to the City a proposed Operating Budget for the for such year. Each such annual Operating
Budget shall include Manager's good faith projection of Revenues and Operating Expenses,presented on a monthly
and annual basis, for the upcoming Operating Year. The City agrees to provide Manager with all information in its
possession necessary to enable Manager to prepare each Operating Budget.Manager agrees to cooperate with the City
and make presentations to the City council as part of the City's own internal budgeting process.
MANAGEMENT SERVICES AGREEMENT - 10- 8/2018
Section 7.2 Approval of Operating Budget. Each of the annual Operating Budgets shall be subject to the
review and approval of the City, which approval may be withheld or granted in its sole discretion. In order for the
City to fully evaluate and analyze such budgets or any other request by Manager relating to income and expenses,
Manager agrees to provide to the City such reasonable financial information relating to the Facility as may be
requested by the City from time to time. If extraordinary events occur during any Operating Year that could not
reasonably be contemplated at the time the corresponding Operating Budget was prepared,Manager may submit an
amendment to such budget for review and approval by the City,which approval may be withheld or granted in its sole
discretion.If the City fails to approve any annual Operating Budget(or any proposed amendment thereto),the City
shall promptly provide Manager the specific reasons therefor and its suggested modifications to Manager's proposed
Operating Budget or amendment in order to make it acceptable. The parties shall then engage in good faith
discussions and use reasonable commercial efforts to attempt to resolve the matter to the mutual satisfaction of the
parties, including, if applicable, negotiation of a mutually acceptable modification to the economic terms of this
Agreement to enable the Manager to achieve the compensation contemplated by its proposed Operating Budget.
Section 7.3 Adherence to Operating Budget. Manager shall use all reasonable efforts to manage and
operate the Facility in accordance with its Operating Budget.However,City acknowledges that notwithstanding the
Manager's experience and expertise in relation to the operation of facilities similar to the Facility, the
projections contained in each Operating Budget are subject to and may be affected by changes in financial,
economic and other conditions and circumstances beyond the Manager's control,and that Manager shall have no
liability if the numbers within the Operating Budget are not achieved. Manager agrees to notify the City within 30
days of any significant change or variance in the bottom line number in the Operating Budget, and any material
increase in total Facility expenses from that provided for in the Operating Budget.In either such case Manager agrees
to work with City to develop and implement a plan(or changes to the then current plan)to limit Operating Expenses
to be incurred in the remaining months of such Operating Year with the goal of achieving the Operating Budget.
ARTICLE 8
PROCEDURE FOR HANDLING INCOME
Section 8.1 Event Account. Manager shall deposit as soon as practicable following receipt, in the Event
Account for the Facility, all revenue received from ticket sales and similar event-related revenues that Manager
receives in contemplation of,or arising from,an event at the Facility,pending completion of the event.Such monies
will be held in trust for the protection of ticket purchasers, City, and Manager, and to provide a source of funds as
required for payments to performers and for payments of direct incidental expenses in connection with the
presentation of events that must be paid prior to or contemporaneously with such events. Promptly following
completion of such events, Manager shall transfer all funds remaining in the Event Account,including any interest
accrued thereon, into the Operating Account for the Facility.
Section 8.2 Operating Account. Except as provided in Section 8.1,all Revenue derived from operation of
the Facility shall be deposited by Manager into the Operating Account as soon as practicable upon receipt. The
specific procedures(and authorized individuals)for making deposits to and withdrawals from such account shall be
set forth in the Operations Manual,but the parties specifically agree that Manager shall have authority to sign checks
and make withdrawals from such accounts,subject to the limitations of this Agreement,without needing to obtain the
co-signature of a City employee or representative.
ARTICLE 9
FUNDING
ce
shall payall items of expense for the operation, maintenance,
Section 9.1 Source of Funding. Manager p p
inthe Operating Accounts for the Facility.The Operating
supervision and management of the Facility from the funds p g h' P
MANAGEMENT SERVICES AGREEMENT - 11 - 8/2018
Accounts shall be funded with amounts generated by operation of the Facility(as described in Article 8 above),or
otherwise made available by the City. To ensure sufficient funds are available in the Operating Accounts,City will
deposit in the Operating Accounts,on or before the Effective Date,the budgeted or otherwise approved expenses for
the Facility for the three(3)month period beginning on the Effective Date.The City shall thereafter,on or before the
1st day of each succeeding month following the Effective Date, deposit (or allow to remain) in the Operating
approved expenses for each such month,retaining the budgeted or otherwise ppro ed at all times in the accounts
funding for the upcoming 3-month period.Manager shall have no liability to the City or any third party in the event
Manager is unable to perform its obligations hereunder,or under any third-party contract entered into pursuant to the
terms hereof,due to the fact that sufficient funds are not made available to Manager to pay such expenses in a timely
manner.If the City appropriates funds at(or reduces appropriated funds to)a level that,in the Manager's good faith
reasonable judgment,renders the management of the Facility as contemplated in the Agreement not feasible,Manager
and the City shall meet as necessary to formulate a plan to continue management of the Facility at a reduced level of
services consistent with anticipated Operating Revenues and available funding.
Section 9.2 Advancement of Funds. Under no circumstances shall Manager be required to pay for or
advance any of its own funds to pay for any Operating Expenses. In the event that,notwithstanding the foregoing,
Manager agrees to advance its own funds to pay Operating Expenses,City shall promptly reimburse Manager for the
full amount of such advanced funds, plus interest at 12%per annum.
ARTICLE 10
FISCAL RESPONSIBILITY; REPORTING
Section 10.1 Records. Manager agrees to keep and maintain, at its office in the Facility, separate and
independent records, in accordance with generally accepted accounting principles, devoted exclusively to its
operations in connection with its management of the Facility. Such records(including books,ledgers,journals,and
accounts)shall contain all entries reflecting the business operations of Manager under this Agreement. The City or
its authorized agent shall have the right to audit and inspect such records from time to time during the Term,upon
reasonable notice to Manager and during Manager's ordinary business hours.
Section 10.2 Monthly Financial Reports.Manager agrees to provide to the City,within thirty(30)days after
the end of each month during the Term, financial reports for the Facility including a balance sheet,aging report on
accounts receivable,and statement of revenues and expenditures(budget to actual)for such month and year to date in
accordance with generally accepted accounting principles. In addition, Manager agrees to provide to the City a
summary of bookings for each such month,and separate cash receipts and disbursements reports for each event held
at the Facility during such month.Additionally,Manager shall submit to the City,or shall cause the applicable public
depository utilized by Manager to submit to the City,on a monthly basis,copies of all bank statements concerning the
Event Account and the Operating Account.
Section 10.3 Annual Plan. Simultaneously with the submission of each annual Operating Budget,Manger
shall also submit an annual plan (the "Annual Plan") for the City's review and approval. The Annual Plan will
include information regarding Manger's anticipated operations for the coming Operating Year, including planned
operating maintenance activities(including a preventive maintenance schedule),expense control initiatives,requested
capital improvements and capital equipment urchases,anticipated events at the Facility,anticipated advertising and
promotional activities,and planned equipment and furnishings purchases.The Annual Plan shall be subject to review,
revision and approval by the City.
Section 10.4 Audit.Manager agrees to provide to the City,within one hundred twenty(120)days following
the end of each Operating Year, a certified audit report on the accounts and records as kept by Manager for the
Facility. Costs associated with obtaining such certified audit report shall be an Operating Expense of the Facility.
Such audit shall be performed by an external auditor approved by the City,and shall be conducted in accordance with
MANAGEMENT SERVICES AGREEMENT - 12- 8/2018
generally accepted auditing standards and those procedures required by applicable state law. Manager agrees that it
will cooperate fully with the Auditor's Office of the State of Washington and provide it and its agents with all
information that it may request in connect with a state audit of the Facility.Costs associated with a state audit shall be
an Operating Expense of the Facility.
Section 10.5 Federal Program Reporting. Facility construction costs were partially funded by the federal
Section 108 program as well as the New Market Tax Credit program,both of which require recording and reporting
of performance metrics on established subjects. Manager agrees to record those metrics required by the City to
facilitate the City's obligation to report to the federal government.
ARTICLE 11
CAPITAL IMPROVEMENTS; MANAGER CONTRIBUTION
Section 11.1 Schedule of Capital Expenditures. Manager shall annually, at the time of submission of the
annual Operating Budget to the City,provide to the City a schedule of proposed capital improvements to be made at
the Facility, for the purpose of allowing the City to consider such projects and to prepare and update its long-range
Capital Expenditure budget.
Section 11.2 Responsibility for Capital Expenditures. The City shall be solely responsible for all Capital
Expenditures at the Facility; provided, however, the City shall be under no obligation to make any Capital
Expenditures proposed by Manager,and provided further that Manager shall have no liability for any claims,costs or
damages arising out of a failure by the City to make any Capital Expenditures. Notwithstanding the foregoing,
Manager shall have the right(but not the obligation), upon notice to the City, to make Capital Expenditures at the
Facility for Emergency Repairs.In such event,the City shall promptly reimburse Manager for the cost of such Capital
Expenditure.
Section 11.3 Manager Contribution. Manager hereby agrees to make a contribution of One Hundred
Thousand Dollars($100,000)to the City(the"Contribution"). The Contribution shall be paid to the City no later
than December 31, 2018, and may be used for any purpose in the City's discretion,but the City agrees to give due
consideration to using such funds to pay the Transition Costs and to develop an event fund to attract events to the
Facility.The Contribution shall be amortized on a straight-line basis over a one hundred twenty(120)month period
(at the rate of 1/120 per month),beginning on the Effective Date and ending on July 31,2028.Upon the expiration or
termination(for any reason whatsoever,including without limitation if due to a breach,default or bankruptcy event
by or affecting Manager,or if the City elects not to renew this Agreement beyond the Initial Term)of this Agreement,
the City shall immediately pay to Manager the unamortized amount of the Contribution,without deduction or setoff
of any kind.
ARTICLE 12
FOOD AND BEVERAGE SERVICE
Section 12.1 Generally. The City currently contracts with a third party to provide food and beverage
concessions.No later than ten(10)days after the Effective Date,City agrees to give written notice to this third party
that it is terminating that contract, effective 90 days from the provision of such notice, and Manager agrees to
facilitate a transition to Manager-provided food and beverage service. City represents that it has the legal right to
terminate such third party contract for its convenience on ninety(90)days'prior notice. Following such termination
and transition period,Manager shall have the sole and exclusive right to manage and perform,and Manager hereby
agrees to manage and perform all food and beverage concession and catering service at the Facility ("Food and
Beverage Service"). Manager may engage sub-contractors to sell food and beverages at the Facility.
Section 12.2 Concession and Catering Areas. Following the termination and transition period described in
Section 12.1 above, Manager shall have the exclusive right to use,or permit a third-party to use,as applicable,the
MANAGEMENT SERVICES AGREEMENT - 13- 8/2018
concession stands, novelty stands, customer serving locations, banquet facility, catering facility,exhibition space,
food preparation areas,vendor commissaries,kitchen and storage facilities,and other food service related areas of the
Facility,together with the improvements,equipment and personal property upon or within such areas,for the purpose
of providing the Food and Beverage Service(and providing other duties required of Manager hereunder).Manager
shall acquire all smallwares and equipment reasonably required by Manager to perform the Food and Beverage
Service and such costs shall be an Operating Expense or Capital Expenditure, as applicable, of the Facility.
Section 12.3 Food and Beverage Duties. In connection with its management and provision of the Food and
Beverage Service,Manager shall:
(a) Develop and implement all necessary policies and procedures for the food and beverage
operations;
(b) Engage and oversee employees necessary to perform the Food and Beverage Services;
(c) Manage the Food and Beverage Service in compliance with and subject to all federal,state and
local laws,ordinances and regulations(including,without limitation,health and sanitation codes and regulations with
respect to the sanitation and purity of the food and beverage products for sale);
(d) Arrange for all minor repairs and routine maintenance to the equipment used in the operation
of the Food and Beverage Service;
(e) Keep the food and beverage Facility and equipment neat, clean, and sanitary condition;
(f) Undertake appropriate advertising, marketing, and promotion of the food and beverage
offerings at the Facility;
(g) Develop menus,portions,brands,prices,themes and marketing approaches.Manager shall be
entitled to set the prices for such items for sale,but Manager agrees to confer with the City's Contract Administrator
and take the City's views into account prior to setting(or changing)such prices; and
(h) Order, stock, prepare, pay for (as an Operating Expense) and sell appropriate foods and
beverages.
Section 12.4 Alcohol Licenses and Permits.Manager agrees to apply for all appropriate alcohol licenses and
permits,subject to applicable law.The City shall provide reasonable assistance to Manager in such regard.At the end
of the Term,Manager shall without charge to City relinquish its rights in, or terminate(as applicable),the alcohol
licenses and permits for the Facility.
Section 12.5 Food and Beverage Revenue and Expenses.All revenue to the Facility from operation of the
Food and Beverage Service shall be deemed Revenue,and shall be deposited by Manager into the Operating Account.
All expenses incurred in connection with the provision of the Food and Beverage Service shall be Operating
Expenses,payable by Manager with funds from the Operating Account.
ARTICLE 13
FACILITY CONTRACTS;TRANSACTIONS WITH AFFILIATES
Section 13.1 Existing Contracts.The City shall provide to Manager,on or before the Effective Date,copies
of all Existing Contracts. Manager shall administer and assure compliance with such Existing Contracts.
MANAGEMENT SERVICES AGREEMENT - 14- 8/2018
Section 13.2 Execution of Contracts. Excluding any contract for a "public work" as defined in Chapter
39.04 RCW,Manager shall have the right to enter into Service Contracts,Revenue Generating Contracts and other
contracts related to the operation of the Facility,as agent on behalf of the City. Any such material agreements shall
contain standard indemnification and insurance obligations on the part of each vendor,licensee or service provider,as
is customary for the type of services or obligations being provided or performed by such parties. Manager shall
obtain the prior approval of the City(which approval shall not be unreasonably withheld or delayed)before entering
into any such contract with a term that expires after the Term of this Agreement,unless such contract,by its express
terms,can be terminated by Manager or City following expiration of the Term without any penalty.
Section 13.3 Transactions with Affiliates. In connection with its obligations hereunder relating to the
purchase or procurement of services for the Facility,Manager may purchase or procure such services,or otherwise
transact business with, an Affiliate of Manager, provided that the prices charged and services rendered by such
Affiliate are competitive with those obtainable from any unrelated parties rendering comparable services.Manager
shall,at the request of the City, provide reasonable evidence establishing the competitive nature of such prices and
services,including,if appropriate,competitive bids from other persons seeking to render such services at the Facility.
ARTICLE 14
AGREEMENT MONITORING AND GENERAL MANAGER
Section 14.1 Contract Administrator. Each party shall appoint a contract administrator who shall monitor
such party's compliance with the terms of this Agreement. Manager's contract administrator shall be its General
Manager at the Facility, unless Manager notifies City of a substitute contract administrator in writing. City shall
notify Manager of the name of its contract administrator within thirty(30)days of execution hereof.Either party may
change its contract administrator by providing written notice of such change to the other party.Any matters in this
Agreement requiring Manager's participation or approval shall mean the participation or approval of the Manger's
contract administrator, who to the extent such contract administrator has authority delegated from Manager, shall
have the authority to act for and bind Manager with respect to any such matter. The City acknowledges that
Manager's contract administrator does not have the authority to amend or modify this Agreement in any manner.
Any matters in this Agreement requiring the City's participation or approval shall be directed to the City's contract
administrator.The City's contract administrator may,to the extent such contract administrator has authority delegated
from the City, act for and bind the City. When the City's contract administrator must present an issue to the City
mayor or City council in order to authorize a request or bind the City, the City contract administrator will notify
Manager promptly.
ARTICLE 15
INDEMNIFICATION
Section 15.1 Indemnification by Manager. Manager agrees to defend,indemnify and hold harmless the City
and its officials,directors,officers,employees,agents, successors and assigns against any claims,causes of action,
costs,expenses(including reasonable attorneys'fees)liabilities,or damages(collectively,"Losses")suffered by such
parties and caused by any(a)negligent act or omission,or intentional misconduct,on the part of Manager or any of
its employees or agents in the performance of its obligations under this Agreement,or(b)breach by Manager of any
of its representations, covenants or agreements made herein.
Section 15.2 Indemnification by the City. City agrees to defend,indemnify and hold harmless Manager,its
parent, subsidiary and affiliate companies, and each of their respective directors, officers, employees, agents,
successors and assigns, against any Losses suffered by such parties, arising out of or in connection with (a) any
negligent act or omission,or intentional misconduct,or failure to comply with Laws,on the part of City or any of its
employees or agents (excluding Manager and its employees) in the performance of its obligations under this
Agreement, (b) a breach by City of any of its representations, covenants or agreements made herein, including
MANAGEMENT SERVICES AGREEMENT - 15- 8/2018
without limitation City's obligation to pay any budgeted or otherwise approved expenses in a timely manner, (c)
failure by City to pay any amounts due by City or to otherwise perform any obligations of City under any third-party
contracts,licenses or agreements entered into by Manager in furtherance of its duties hereunder as authorized hereby;
(d)any environmental condition at the Facility or on or under the premises on which the Facility is located not caused
by Manager,its employees or agents,(e)any structural defect with respect the Facility,(f)the fact that any time prior
to,as of,or after the effective date of this agreement the Facility is not or has not been in compliance with all Laws,
including, but not limited to,the Americans With Disabilities Act as it now exists and as it may be amended in the
future by statute or judicial interpretation,(g)any act or omission carried out by Manager at or pursuant to the written
direction or instruction of City, its agents or employees, (h) any claims relating to the Facility or their operations
accruing or caused by occurrences prior to the Effective Date or following termination or expiration of this
Agreement, and(i) any withdrawal liability for a share of unfunded vested benefits under multiemployer plans(as
that term is defined in 4001(a)(3)of the Employee Retirement Income Security Act of 1974, as amended).
Section 15.3 Conditions to Indemnification. With respect to each separate matter brought by any third party
against which a party hereto("Indemnitee")is indemnified by the other party("Indemnitor")under this Article 15,the
Indemnitor shall be responsible,at its sole cost and expense,for controlling, litigating,defending and/or otherwise
attempting to resolve,through counsel of its choice,any proceeding,claim,or cause of action underlying such matter,
except that(a)the Indemnitee may,at its option,participate in such defense or resolution at its expense and through
counsel of its choice; (b) the Indemnitee may, at its option, assume control of such defense or resolution if the
Indemnitor does not promptly and diligently pursue such defense or resolution,provided that the Indemnitor shall
continue to be obligated to indemnify the Indemnitee hereunder in connection therewith;and(c)neither Indemnitor
nor Indemnitee shall agree to any settlement without the other's prior written consent (which shall not be
unreasonably withheld or delayed).In any event,Indemnitor and Indemnitee shall in good faith cooperate with each
other and their respective counsel with respect to all such actions or proceedings,at the Indemnitor's expense.With
respect to each and every matter with respect to which any indemnification may be sought hereunder,upon receiving
notice pertaining to such matter,Indemnitee shall promptly give reasonably detailed written notice to the Indemnitor
of the nature of such matter and the amount demanded or claimed in connection therewith.
Section 15.4 Survival. The obligations of the parties contained in this Article 15 shall survive the
termination or expiration of this Agreement.
Section 15.5 Legal Costs. Notwithstanding the other provisions of this Agreement,if legal costs are being
incurred by the Manager or the City for a third-party claim in respect of which the City is claiming indemnity from
the Manager, such legal costs will be considered an Operating Expense unless and until liability of the Manager
pursuant to this Agreement is established by a court of competent jurisdiction with respect to the underlying claim on
which the Manager's obligation to indemnify is based.In the event that the liability of the Manager is so determined,
then such legal costs shall be considered as costs of the Manager(and not Operating Expenses)in proportion to the
comparative degree established by the court and covered by the indemnity given by the Manager to the City
hereunder and the parties shall adjust between them in respect of such legal costs.
ARTICLE 16
INSURANCE
Section 16.1 Types and Amount of Coverage. Manager agrees to obtain insurance coverage in the manner
and amounts as set forth in Exhibit D,attached hereto,and shall provide to the City promptly following
the Effective
Date a certificate of certificates of insurance evidencing such coverage. Manager shall maintain such referenced
insurance coverage at all times during the Term,and will not make any material modification or change from these
specifications without the prior approval of the City. Each insurance policy shall include a requirement that the
Manager and the Cityat least thirty(30)days written notice of cancellation or material change in the
insurerprovide
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MANAGEMENT SERVICES AGREEMENT - 16- 8/2018
terms and provisions of the applicable policy. The cost of all such insurance shall be an Operating Expense.
Section 16.2 Rating; Additional Insureds. All insurance policies shall be issued by insurance companies
rated no less than A VIII in the most recent"Bests"insurance guide, and licensed in the State of Washington or as
otherwise agreed by the parties. All such policies shall be in such form and contain such provisions as are generally
considered standard for the type of insurance involved.The commercial general liability policy,automobile liability
insurance policy,and umbrella or excess liability policy to be obtained by Manager hereunder shall name City as an
additional insured.The workers compensation policy to be obtained by Manager hereunder shall contain a waiver of
all rights of subrogation against the City. Manager shall require that all third-party users of the Facility, including,
without limitation, third-party licensees, ushers, security personnel, and concessionaires provide certificates of
insurance evidencing insurance appropriate for the types of activities in which such user is engaged. If Manager
subcontracts any of its obligations under this Agreement, Manager shall require each such subcontractor to secure
insurance that will protect against applicable hazards or risks of loss as and in the minimum amounts designated
herein, and name Manager and the City as additional insureds.
Section 16.3 Crime Insurance.Those employees of Manager who have access to or are responsible for the
funds generated under this Agreement shall be covered by a crime insurance policy to be obtained by Manager
consistent with the requirements of Exhibit D hereto.
ARTICLE 17
REPRESENTATIONS,WARRANTIES AND COVENANTS
Section 17.1 Manager Representations and Warranties. Manager hereby represents,warrants and covenants
to City as follows:
(a) that it has the full legal right,power and authority to enter into this Agreement and to grant the
rights and perform the obligations of Manager herein,and that no third party consent or approval is required to grant
such rights or perform such obligations hereunder;and
(b) that this Agreement has been duly executed and delivered by Manager and constitutes a valid
and binding obligation of Manager, enforceable in accordance with its terms,except as such enforceability may be
limited by bankruptcy,insolvency,reorganization,or similar Laws affecting creditors'rights generally or by general
equitable principles.
(c) that Manager will comply with all Laws applicable to its management of the Facility,provided
that Manager shall not be required to undertake any compliance activity,nor shall Manager have any liability under
this Agreement therefor, if such activity requires any Capital Expenditure.
Section 17.2 City Representations,Warranties and Covenants. City represents,warrants and covenants to
Manager as follows:
(a) that it has the full legal right,power and authority to enter into this Agreement and to grant the
rights and perform the obligations of City herein,and that no other third party consent or approval is required to grant
such rights or perform such obligations hereunder.
(b) that this Agreement has been duly executed and delivered by City and constitutes a valid and
binding obligation of City,enforceable in accordance with its terms,except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally or by general equitable
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MANAGEMENT SERVICES AGREEMENT - 17- 8/2018
(c) that the Facility is,as of the Effective Date, in compliance in all respects with all applicable
Laws relating to the construction, use and operation of the Facility (including, without limitation, Title III of the
American with Disabilities Act), and that the City has no knowledge of any existing structural defects or unsound
operating conditions at the Facility.
ARTICLE 18
MISCELLANEOUS
Section 18.1 PCI Compliance. Manager agrees to comply with all current Payment Card Industry Data
Security Standards("PCI Standards")and guidelines that may be published from time to time by Visa,MasterCard or
other associations as they relate to the physical storage of credit card data.For PCI Standards compliance purposes,
City will provide on a segmented network,an appropriate number of wired data connections to the Internet for point
of sale devices to be used by Manager and any contractors at the Facility.City shall be responsible for the security of
its network,including,without limitation,applicable PCI-DSS compliance,and for procuring and installing point of
sale("POS")payment systems that are compliant with the latest PCI-DSS requirements. If at any time either party
determines that card account number or other information has been compromised, such party will notify the other
immediately and assist in providing notification to the proper parties as deemed necessary.
Section 18.2 No Discrimination. Manager agrees that it will not discriminate against any employee or
applicant for employment for work under this Agreement because of race,religion, color, sex,disability,national
origin,ancestry,physical handicap,age,sexual orientation,gender identity,or veteran or military status and will take
affirmative steps to ensure that applicants are employed, and employees are treated during employment, without
regard to race, religion, color, sex, disability, national origin, ancestry, physical handicap, age, sexual orientation,
gender identity, or veteran or military status.
Section 18.3 Use of Facility Names and Logos. Manager shall have the right to use throughout the Term
(and permit others to use in furtherance of Manager's obligations hereunder),for no charge,the name and all logos of
the Facility, on Manager's stationary, in its advertising of the Facility, and whenever conducting business of the
Facility;provided,that Manager shall take all prudent and appropriate measures to protect the intellectual property
rights of the City relating to such logos. All intellectual property rights in any Facility logos developed by the
Manager or the City shall be and at all times remain the sole and exclusive property of the City. Manager agrees to
execute any documentation requested by the City from time to time to establish, protect or convey any such
intellectual property rights.
Section 18.4 Facility Advertisements.The City agrees that in all advertisements placed by the City for the
Facility or events at the Facility, whether such advertisements are in print, on radio, television, the internes or
otherwise, it shall include a designation that the Facility is"Managed by Spectra".
Section 18.5 Force Majeure: Casualty Loss.
(a) Neither party shall be liable or responsible to the other party for any delay, loss, damage,
failure or inability to perform under this Agreement due to an Event of Force Majeure, provided that the party
claiming failure or inability to perform provides written notice to the other party within thirty(30)days of the date on
which such party gains actual knowledge of such Event of Force Majeure.Notwithstanding the foregoing,in no event
shall a party's failure to make payments due hereunder be excusable due to an Event of Force Majeure.
(b) In the event of damage or destruction to a material portion of the Facility by reason of fire,
storm,or other casualty loss that renders the Facility(or a material portion thereof)uninhabitable,the City shall use
reasonable efforts to remedy such situation.If notwithstanding such efforts,such damage or destruction is expected to
render the Facility(or a material portion thereof)untenantable for a period estimated by an architect selected by the
MANAGEMENT SERVICES AGREEMENT - 18- 8/2018
City at Manager's request, of at least one hundred eighty (180) days from the date of such fire, storm, or other
casualty loss,either party may terminate this Agreement upon written notice to the other,provided that(i)the City
shall pay to Manager its costs of withdrawing from services at the Facility hereunder,as described in Section 4.3(a)
above,and(ii)the parties shall negotiate appropriate adjustments to the compensation terms herein to account for the
reduction in duties of Manager hereunder(and any such changes shall be mutually agreed).
Section 18.6 Assignment., Binding on Successors and Assigns. Neither party may assign this Agreement
without the prior written consent of the other,which consent shall not be unreasonably withheld or delayed,except
that either party may,without the prior written consent of the other party but upon at least 30 days' written notice to
the other party,assign this Agreement in connection with a sale,merger,or other business combination involving all
or substantially all of its assets or equity interests, and Manager may further assign this Agreement to an Affiliate
where such assignment is intended to accomplish an internal corporate purpose of Manager as opposed to materially
and substantially altering the method of delivery of services to City. Any purported assignment in contravention of
this Section shall be void. This Agreement is binding on successors and permitted assigns of the parties.
Section 18.7 Notices. All notices required or permitted to be given pursuant to this Agreement shall be in
writing and delivered personally or sent by registered or certified mail, return receipt requested, or by generally
recognized,prepaid,overnight air courier services,to the address and individual set forth below.All such notices to
either party shall be deemed to have been provided when delivered, if delivered personally, three (3) days after
mailed, if sent by registered or certified mail, or the next business day, if sent by generally recognized, prepaid,
overnight air courier services.
If to the City: If to Manager:
City of Federal Way Spectra Venue Management
33325 8`h Avenue South 3601 S. Broad Street
Federal Way, WA 98003 Philadelphia, PA 19148
Attn:Parks Department Attn: Chief Operating Officer
With a copy to: With a copy to:
City of Federal Way Spectra Venue Management
33325 8th Avenue South 3601 South Broad Street
Federal Way, WA 98003 Philadelphia, Pennsylvania 19148-5290
Attn: City Attorney's Office Attn: General Counsel
The designation of the individuals to be so notified and the addresses of such parties set forth above may be changed
from time to time by written notice to the other party in the manner set forth above.
Section 18.8 Severability. If a court of competent jurisdiction determines that any term of this Agreement is
invalid or unenforceable to any extent under applicable law,the remainder of this Agreement(and the application of
this Agreement to other circumstances) shall not be affected thereby, and each remaining term shall be valid and
enforceable to the fullest extent permitted by law.
Section 18.9 Entire Agreement. This Agreement(including the exhibits attached hereto)contains the entire
agreement between the parties with respect to the subject matter hereof, and supersedes and replaces all prior
negotiations,correspondence,conversations,agreements,and understandings concerning the subject matter hereof.
Accordingly, the parties agree that no deviation from the terms hereof shall be predicated upon any prior
representations, agreements or understandings, whether oral or written.
MANAGEMENT SERVICES AGREEMENT - 19- 8/2018
Section 18.10 Governing Law.The Agreement is entered into under and pursuant to,and is to be construed
and enforceable in accordance with, the laws of the State of Washington without regard to its conflict of laws
principles.
Section 18.11 Amendments.Neither this Agreement nor any of its terms may be changed or modified except
by an instrument in writing signed by an authorized representative of both of the parties to this Agreement.
Section 18.12 Waiver; Remedies.No failure or delay by a party hereto to insist on the strict performance of
any term of this Agreement, or to exercise any right or remedy consequent to a breach thereof, shall constitute a
waiver of any breach or any subsequent breach of such term.No waiver of any breach hereunder shall affect or alter
the remaining terms of this Agreement, but each and every term of this Agreement shall continue in full force and
effect with respect to any other then existing or subsequent breach thereof.The remedies provided in this Agreement
are cumulative and not exclusive of the remedies provided by law or in equity.
Section 18.13 Relationship of Parties. Manager and City acknowledge and agree that they are not joint
venturers, partners, or joint owners with respect to the Facility, and nothing contained in this Agreement shall be
construed as creating a partnership,joint venture or similar relationship between City and Manager.In operating the
Facility,entering into contracts,accepting reservations for use of the Facility,and conducting financial transactions
for the Facility,Manager acts on behalf of and as agent for City(but subject to the limitations on Manager's authority
as set out in this Agreement),with the fiduciaryduties required by law of a party acting in such capacity.
q
Section 18.14 No Third Party Beneficiaries. Other than the indemnitees listed in Sections 15.1 and 15.2
hereof(who are third party beneficiaries solely with respect to the indemnification provisions in such sections),there
are no intended third party beneficiaries under this Agreement,and no third party shall have any rights or make any
claims hereunder,it being intended that solely the parties hereto(and the aforementioned indemnitees with respect to
the indemnification provisions hereof)shall have rights and may make claims hereunder.
Section 18.15 Limitation on Damages. In no event shall either party be liable or responsible for any
consequential,indirect,incidental,punitive,or special damages(including,without limitation,lost profits)whether
based upon breach of contract or warranty,negligence,strict tort liability or otherwise,and each party's liability for
damages or losses hereunder shall be strictly limited to direct damages that are actually incurred by the other party,
provided that the foregoing shall not limit or restrict any claim by Manager for the management fees described herein
upon a breach or default of this Agreement by City.
Section 18.16 Counterparts; Facsimile and Electronic Signatures. This Agreement may be executed in
counterparts,each of which shall constitute an original,and all of which together shall constitute one and the same
document.This Agreement may be executed by the parties and transmitted by facsimile or electronic transmission,
and if so executed and transmitted, shall be effective as if the parties had delivered an executed original of this
Agreement.
Section 18.17 Public Records Act. To the extent the Washington Public Records Act(Chapter 42.56 RCW)
or equivalent or successor statute is applicable to the City,Manager shall cooperate,coordinate with,and assist the
City in the disclosure,or non-disclosure in the event of an exemption to such disclosure,of any information requested
under the Public Records Act, as determined by the City, in its sole discretion.
Section 18.19 Gratuities and Kickbacks.It shall be a breach of the Manager's obligations hereunder to offer,
give, or agree to give any person, entity or any employee of the City(or former employee of the City) a gratuity,
success fee, commission, anything else of value, or an offer of employment in connection with any decision,
approval,disapproval,recommendation,preparation of any part of any purchase request,influence in the consent of
any specification or procurement standard, rendering of advice, investigation, auditing, or in any other advisory
MANAGEMENT SERVICES AGREEMENT -20- 8/2018
capacity,in any proceeding or application,request for ruling,determination,claim or controversy or other particular
matter,pertaining to or solicitation of, any contract or proposal therefor by the manager from the City.
IN WITNESS WHEREOF,each party hereto has caused this Management Agreement to be executed
on behalf of such party by an authorized representative as of the date first set forth above.
CITY FEDERAL WAY: ATTEST:
•
ff/errMaYOr !JCL; Courtney, CMC, Ci Jerk
DATE: (0l ZS 1S1
APPROVED AS TO FORM:
•Jr\g,
J. Ryan Call, City Attorney
MANAGEMENT SERVICES AGREEMENT -21 - 8/2018
GLOBAL SPECTRUM, L.P.:
By: ,--2- 4/1/ D
Printed Name: 4 ' 11 /'
Title: / W, 1 Yj °F,/( cJ Wt `L` (-17
DATE: ‘/).-7//�'
STATE OF T-Phf5il1Vlt/ni't,)
) ss.
COUNTY OFPAihie p ;tR) ,/�
On thi day pers nally appeared before me fid / /°UlT ?P to me known to be the
Sr, f GLOBAL SPECTRUM, L.P. th executed the foregoing
g
instrument,and acknowledged the said instrument to be the free and voluntary act and deed of said
corporation, for the uses and purposes therein mentioned, and on oath stated that he/she was
authorized to execute said instrument and that the seal affixed, if any, is the corporate seal of said
corporation.
GIVEN my hand and official seal this 017 day of , 20/g
Notary's signature c /
Notary's printed nam `, 1t � Sk r
Notary Public in and for the State of -e S ��/
My commission expires No ye abet'-c v .
Commonwealth or Pennsylvania•Notary Seal
Philadelphia County Public
AV Commission Expires November 5,2021
Commission Number 1126074
MANAGEMENT SERVICES AGREEMENT -22- 8/2018
SCHEDULE
1
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8/2018
_.)3 -
ENT
AGREEM
MANANJr'EMENT SERVICES
EXHIBIT A
MANAGER DUTIES
Manager's obligations under the Agreement shall consist of the following obligations,all of
which are subject to the terms hereof and the controls and restrictions in the Operations Manual:
(a) Manage all aspects of the Facilityin accordance with the Operations Manual ual and the
terms of this Agreement, including but not limited to managing food and beverage service,
purchasing, payroll, fire prevention, security, crowd control, routine repairs, preventative
maintenance,janitorial services,promotions,advertising,energy conservation,security,box office,
admission procedures,parking(if applicable), and general user services.
(b) Establish and adjust prices, rates and rate schedules for user, license, concessions,
occupancy,and advertising agreements,and booking commitments. Manager may deviate from the
established rate schedule when entering into any such agreements if determined by Manager,using
its reasonable business judgment,to be necessary or appropriate with respect to the specific situation.
(c) Procure,negotiate,execute,administer and assure compliance with Service Contracts,
Revenue Generating Contracts, and other contracts related to the operation of the Facility.
(d) Require that all material vendors and licensees of the Facility execute vendor/license
agreements containing standard indemnification and insurance obligations on the part of each such
vendor/licensee.
(e) Provide standard form advertising and sponsorship contracts and user/rental
agreements for use at or with respect to the Facility. Manager shall submit such form agreements to
the City for review and comment,and the parties shall work together to finalize such forms. Once
finalized, Manager shall use such forms in furtherance of its duties hereunder, and shall not
materially deviate from the terms contained in such forms without obtaining the prior approval of the
City ( unreasonably shall not be withheld). Manager's sole responsibility with regard to
providing legal advice or assistance hereunder shall be to provide such standard form contracts.
(f) Operate and maintain the Facility,including the equipment utilized in connection with
its operation and any improvements made during the term of this Agreement, in the condition
received, normal wear and tear excepted.
(g) Arrange for and otherwise book events at the Facility in accordance with booking
schedules to be developed by Manager.
(h) Hire or otherwise engage, pay, supervise, and direct all personnel Manager deems
necessary for the operation of the Facility in accordance with Article 6 of the Agreement, and
conduct staff planning,retention and training programs as determined to be necessary by Manager in
its sole discretion.
(i) Maintain detailed, accurate and complete financial and other records of all its
activities under this Agreement in accordance with generally accepted accounting principles,which
MANAGEMENT SERVICES AGREEMENT -24- 8/2018
records shall be made available to the City upon request, in accordance with Section 10.1 of the
Agreement.
(j) Submit to the City in a timely manner financial and other reports detailing Manager's
activities in connection with the Facility,as set forth in Section 10.2 of the Agreement.
(k) Prepare proposed annual Operating Budgets and submit such proposed budget to the
City, both in accordance with Article 7 of the Agreement.
(1) Pay all Operating Expenses and other expenses incurred in connection with the
operation,maintenance,supervision and management of the Facility from the applicable Operating
Account or with funds otherwise made available by the City.
(m) Apply for(or any other third party,as applicable,to apply for)all licenses and permits
necessary for the operation and use of the Facility for the specific events to be held therein,and for
the general occupancy of the Facility, including without limitation all necessary food and liquor
licenses, and renewals thereof. The City shall cooperate in this process to the extent reasonably
required. All costs associated with this process shall be Operating Expenses.
(n) Collect, deposit and hold in escrow in the Event Accounts any ticket sale revenues
which it receives in the contemplation of or arising from an event pending the completion of the
event,as more fully described in Section 8.1 of the Agreement.
(o) Collect in a timely manner and deposit in the Operating Accounts all Revenue, as
more fully described in Section 8.2 of the Agreement.
(p) Subject to the City making available sufficient funds in a timely manner, pay all
Taxes.
(q) Plan, prepare, implement, coordinate and supervise all public relations and other
promotional programs for the Facility.
(r) Prepare,maintain and implement on a regular basis,subject to the City's approval,a
Marketing Plan for the Facility.
(s) Market and sell Commercial Rights at or in connection with the Facility. Manager
intends to employ one (1) individual at the Facility to be responsible for marketing and selling
Commercial Rights. The cost of such individual (salary, commission, and benefits) shall be an
Operating Expense.
(t) On an annual basis, cause a written inventory to be taken of all furniture,fixtures,
office equipment, supplies, tools, and vehicles at the Facility, and deliver a written report of the
foregoing to City.Manager shall document all major damage to,or loss in,such inventory during the
Term as soon as such damage or loss is discovered by Manager,and Manager shall promptly notify
City of any such damage or loss.
MANAGEMENT SERVICES AGREEMENT -25- 8/2018
(u) Purchase,on behalf of the City and with City funds,and maintain during the Term,all
materials,tools, machinery, equipment and supplies necessary for the operation of the Facility.
(v) As agent for the City,manage risk management and Facility insurance needs,as more
fully described in Article 16 of the Agreement.
(w) Make and be responsible for all routine and minor repairs,maintenance,preventative
maintenance, and equipment servicing. Manager shall be responsible for ensuring that all repairs,
replacements,and maintenance shall be of a quality and class at least equal to that of the item being
repaired,replaced or maintained. Any replacement of an item in inventory,or any new item added to
the inventory,which is paid for by the City, shall be deemed the property of the City.
(x) Cause such other acts and things to be done with respect to the Facility,as determined
by Manager in its reasonable discretion to be necessary for the management and operation of the
Facility following the Effective Date.
MANAGEMENT SERVICES AGREEMENT -26- 8/2018
EXHIBIT B
EXISTING CONTRACTS
Provider Description
SMG Food&Beverage Food&Beverage Service
on-call per use SPO Janitorial Service
piggy back off of existing Parks Landscaping
contract with Green Effects paid on
a per use basis
one-off SPO Elevator Inspection
one-off SPO Kitchen Range Hood Service
Center Stage Artists Stunt Dogs Performance
Amplified Entertainment, Inc. Lea Salanga Performance
IMG Artists The New Chinese Acrobats
Performance
KMP Artists Gugu Drum Performance
Herschel Freeman Agency, Inc Kahulanui Performance
Elite School of Dance Under the Sea Performance
Divamama Lea Salanga Performance
Korean Music Association of WA Performance
American Music Performance
Tacoma City Ballet Performance
2018 Special Olympics Opening Games Choir Rehearsal
Opus 3 Chanticleer Performance
ICM Partners Vicki Lawrence&Mama
Performance
ICM Partners Rita Rudner Performance
Opus 3 Chanticleer Performance
MANAGEMENT SERVICES AGREEMENT -27- 8/2018
EXHIBIT C
OPERATING BUDGET
1S1 OPERATING YEAR-Effective Date to December 3.1, 201.8
2018 Actual Estimates Projected Budget
FUND 115 Adjusted Edo 5•Mnths Jun 1 Jul 7 Months Aug-Dec Aug Iv Oct Nov Dec
115.5800.115.558-20-1-1()SALARIES&WAGES 420,338 137,733 22,476 22,476 182,686 246,652 - •
115.5800.115-558.20-111 TEMPORARY HELP 05,87+ 62,202 12,172 12.172 86,546 9,333 - - - -
115-5800.115:,-.55.0.20-I16 TERMINATION PAY - 43,046 22.000 65,045 (65.045) - - - • .
' 1'15.5800.'115-568-20-120OVERTIME PAY - 783 - - 783 17831 - • - -
Total Salaries 8 Wag. 525,217 243,754 34,548 56.648 335,950 190.157 - •
' 115-5800-115.558.20-270 STATE PENSIONS-F 46,425 17.492 2,855 2,655 23,201 23,224 - • •
1155800.115.558-20,211 EMPLOYEE 6ENE1: 21,6520 7,819 1.710 '1,716 11,252 10,377 -
115-5800-115-.58.20-213FICAMEDICARE 5,074 7,434 '1,8113 1.5663 11,160 (5,1861 - - . -
115.580(-115.558-20,214 DISABILITYO'URVIVC 56166 1,700 101;1 109 2,099 3,517 - - -
115-5100415-558-20-220INKRS 41c.5 3,228 506 596 4,420 (3,452) -
115.5800.11'-558.20.243 UNEMPLOYMENT 3,023 - 3.923 - -
1(5.5800•1'15-558.20.250 HEALTH INSURANCE 05,468 18,484 2,072 2.072 22,628 43,340 - - -
115.5860.115-568.20-251 DENTAL INSURANCE 6.750 1,776 164 164 2,104' 4,646 -
115.5800-115:-558.20.2`2VISION INSURANCE 901 263 24 24 310 681 - - -Total Benefits 158,244 58,195 9.490 9.490 77,175 81,059 -
;15.5800-115.558.20.3I0OFFICE SUPPLIES 8,500 469 31 31 530 7,970 - - -
115-5800-115-558-20-311 BOOKS,MAPS.4 150 • - . - 150 - -
115.5800.115.558-20-312OTHER OPERATING 9.890 1,046 266 286 1,678 8,312 -
115.5500-115-555-20-.314 HOUSEHOLD SUPPLI 3,552 379 166 106 710 2,972 -
115..E800.115-3668-20,316 C„OPIER 5.PRINTER - 89 45 45 178 (1781 •
115-586717-115-555-20-316 1:000&BEVERAGE 10.000 6,451 2,500 2.500 11.451 (1,451) . .
115.5800-115-568.20-319 REPAIR 4.MA1NT 1,000 216 13+ 17'34. 494 506 - - -
115.5800.115.558.20.330CLOTH1NCAND 957 • - - • 957 - - •
115-5800-715-558.20-3552 SMALL OFFICE .. - • - - - .
115 5599.115-558-20-354 A,1 NOR EOUIP.M1SC 6000 1,280 2.)0 200 1,680 4,320 115-5800-115- 8•20-356MINOROPSCIFT1N.AF - 296 211" 266 988 (8881 - - - .
Total Supplies 40.179 10,226 3.643 3,643 17,511 22,668 - - - - -
I15.5500.115-550-20-41 e;PROFESSIONAL 177,700 164,529 13,474 21.808 219,811 (42,111) - - -
New Contract . -6,250 6.250 6,250 6,250 6,250
115.5600.1 15.050.20.414 NON GOVT DP SERV . 19,785 500 500 20.785 (20,785) - V -
115-5800-115-551;-20.415CUSTODIAL&CLEAN 145.000 1,164 1,101:4 1164 3,492 141,508 - - -
II5 800.11 . .p,..26.421 rnOSTA-,B L&VLI=.'ERY 3,500 188 c,t• 3t"1 325 3,175 - - - -
' 115-5800.1 15-558.20.422 BULK CLASS POSTA 23,000 - . • 20,000 - -
I15.5800.115-Sa8-20,424 Cellular Phone Air Tim • 626 158 158 941 (941) - - - -
I15.5800-115556.20-4321.ODi3ING - 1,169 - • 1.169 (1.169) • - •
115.5800.115-558.20,433PARKING%TOLLS • 12 - - 12 (12) - - -
115.5800-1'15.558.20.435CONFERENCE=SEMII 0,085 395 305 305 1,185 6,900 - - - -
1155800-115-558-20-30 RENTAL CARS-ORQL - 159 - 159 (159) - - -
1IS-5800.1 I5.558.20.436 MILEAGE 272 37 37 346 (345) - - - •. •
115.5800-'I'15•558-20-4IiOTHER TRA,'EL - 6,716 :113 613 7,941 (7,941) - -
115580O-I 5-558-20,440 ADVERTISING 60,127 14,913 2.352 2..352 19,617 60,610 - - •
1155800.1 15.558-20-441 JOB ANNO1,INCEMEN 650 - . 650 - - -
115.5800.115-5 -20-452 OPERATING 330,828 82,707 82,707 . 165.414 165,414 -82.707 - -82,707
'6r..1! 20-1 RENTAL of - 9,973 `:,774 1.774 13,521 (13,521) • - .
.,,, 11'. ,.'A,-17'l ELE(7TPIJI'Y 11.1,0+00 32,309 8,1% 13,159 48.625 61,374
'ii-II 20,472 NATURAL GAS 0974 383 '177 177 737 9,237 - -
1 ".7,630 115.550-20.473 WATER BILLINGS 8,874 2,410 500 500 3.410 5.464 - - •
11 ..,,30:1.110•5f.18-20-474 7.1 P SILLINGs 3,88e 353 200 200 753 2,935 - • - - •
..I,'.....:1.:8-2C:,-476 WASTE DISPOSAL 4.7:0 - - 4,750 - - -
i 10 4'I 20.460 REPAIRS AND • 2,245 300 300 2,845 12,845) - . - •
-
I:5-5Scuff-11'•-558-20•41_111IIISCSERVICES& - 2.133 200 200 2,633 (2,633) - - . -
115-5800-115-558-20-402PRINTINGiPHOTO 28.000 (547) - - 15471 28,547 - . -
115.5800-1 t5-553-20-4517 ASSOCIATION DUES 5 204 696 - - 595 4.609 - - -
Total Services 936.380 362.480 112.777 38,404 513.661 422,719 5.250 88,957 6,250 6,250 88.957
I I5-:5601115.558-20.51.1 KO HEALTH - - - - •.
Total interpcvvrmltenit - - - - - -
115-5800-I15-558-20,840 MACHINERY4. 47,152. 33,333 3,333 20,000 56,687 (9,515) - - - •
115-5800-115.558-20,014 DP 14.0 107.733 13,467 - • 13.467 94,266 - -
115.5800.115.5558-20-Gnu MAIL'COPY M40 16.500 69 2.003 - 2,053 14,438 .
115-5800-115-559-20-909 OTHER 40.581 - - - 40,581 - - - -
Totallnternal Service 211.966 46,859 5,337 20.000 72,195 139.770 • - - - -
TOTAL FOR FUND 115 1.871,985 721.522 -165,895 128,185 1,015.602 " 865,384. - -
•S2:000 for vacation payout for currant employee:.
-there is 54,167 lnarrhg management Ivy that will cease but wilt be replaced r i h$6,250 Them is9u"days notice requirement anal 3 months will be paid in
July(4107'1)
01141-16€•064 8 1Y•p<r1ms11 of abolit 18 .707.100.01 at this arecunl is aWl reflected In tn4 revenue as receipt ;t Is almost a wash
•<r ., •: i-51•;5.114-- - r.. ,., _ .. ,.., .,,, ..
MANAGEMENT SERVICES S AGREEMENT -28- 8/2018
EXHIBIT D
INSURANCE
At all times during this Agreement, Manager shall maintain insurance coverage at commercially
reasonable levels and in compliance with state law where applicable.Minimum insurance coverage
shall be as follows:
(a) commercial general liability insurance,including products and completed operations,
bodily injury and property damage liability,contractual liability, independent contractors'liability
and personal and advertising injury liability against claims occurring on,in,or about the Facility,or
otherwise arising under this Agreement;
(b) umbrella or excess liability insurance;
(c) commercial automobile liability insurance, including coverage for the operation of
owned, leased, hired and non-owned vehicles;
(d) workers compensation and employer's liability insurance as shall be required by and
be in conformance with the laws of the State of Washington;
(e) professional liability insurance and self-insured employment practices liability
coverage;
(f) employment practices liability insurance;
(g) pollution liability; and
(h) crime coverage.
Such liability insurance shall be maintained in the following minimum amounts throughout the
Term:
Commercial General Liability
$1,000,000 per occurrence
$1,000,000 personal and advertising injury
$1,000,000 products-completed operations aggregate
Umbrella or Excess Liability
$5,000,000 per occurrence and aggregate
Automobile Liability
$1,000,000 per accident(PI and PD combined single limit)
$1,000,000 uninsured/underinsured motorist
MANAGEMENT SERVICES AGREEMENT -29- 8/2018
Workers Compensation
Workers Compensation: Statutory
Employer's Liability: $100,000 each accident-bodily injury by accident
$500,000 policy limit-bodily injury by disease
$100,000 each employee-bodily injury by disease
Professional Liability/Errors&Omissions(Claims Made basis)
$1,000,000 each occurrence/aggregate
Employment Practices Liability Insurance (Claims Made basis)
$1,000,000
Pollution Liability(Claims Made basis)
$1,000,000
Crime Insurance
Coverage on all on-site Manager employees. Limit: $500,000.00
MANAGEMENT SERVICES AGREEMENT -30- 8/2018
EXHIBIT E
TRANSITION COSTS
11'4 SPECTRA
Spectra
Performing Arts and Events Center of Federal Way
Estimated Transition Budget
$20,000
General Manager 15,000
Other 5.0(0
Travel $2,250
GM/D.ractor Candidates Interview Trip:, 2
Cost Fe Tp;2 oa.,,,-,11 n•ght) $750
Recruitment Cost
Cost per Background Check $50
Humber of CheckY...- 50
Recuitment Ad Placement 5 $1„000
Total Personnel Expenses $25,750
Corporate Travel Expenses per Trip!based upon 2 niehts13 days):
Air
Airfare(average) 56C0
Transportation(530 per da4 $150
Hot&1$125 Per n'ght) 5250
Ekpenses i,$75 per owit
$2,225
Estimated.Or of Trips a
SVP/Regiona VP 5 56,125
Facihty Acwtinting I $3,675
HtIMV,Resources 2 2,450
Poop&Beverage 4 54,503
Sa'as;3, Marteting A53.675
Total Corporate Trim 17 $20:825
Total Travel Expenses 520.825
TOTAL TRANSITION . . ...• • .... ..... 546,575
MANAGEMENT SERVICES AGREEMENT -31 - 8/2018