HomeMy WebLinkAbout10/20/2004 - STAFF REPORTS (20) M-11ATTORNPYS
ALESHIRE &
WYNDER, LLP AT LAW
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MEMORANDUM
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL, CITY MANAGER,
ASSISTANT CITY MANAGER AND REPRESENTATIVES OF SMG
FROM: TIFFANY J. ISRAEL, ASSISTANT CITY ATTORNEY
DATE: OCTOBER 19, 2004
FILE: 01003-0002
RE: DAVID ALESHIRE's REVISIONS TO THE TOURISM AGREEMENT
The following is a summary of Dave Aleshire's changes to the draft of the Tourism
Agreement which is included in the City Council's agenda packet for October 20, 2004.
1. Section 3.8, Planning, Budgeting Joint Advisory Committee, is changed to read,
in its entirety:
"With the approval of the City Manager, the Director of Tourism may form a Planning,
Budgeting Joint Advisory Committee "PB&J" to advise the Director of Tourism. The Director
may form the PB&J to consist of a group which reflects the broad spectrum of tourism within the
City, including representatives of large hoteliers, medium hoteliers, small hoteliers, gay tourism,
the Uptown merchants association, the Mainstreet association, restaurateurs, the Convention
Center, significant attraction venues, and other similar groups. If a PB&J is formed, the Director
may, in his or her sole discretion, refer issues to the PB&J relating to any aspects of Palm
Springs Tourism including, but not limited to, marketing, Special Events, coordination of
activities with downtown businesses, the Tourism Budget, the One-Year Plan, changes to the
Tourism Budget or the One-Year Plan, the Service Review required pursuant to Section 6.5, the
Annual Performance Review required pursuant to Section 6,6 and the other responsibilities of
SMG as set forth in Section 3,2. If a PB&J is formed, as soon as possible after the PB&J is
formed, the Director of Tourism shall meet with the PB&J and the City Manager to establish
goals and activities to promote Palm Springs Tourism. As discussed in Section 3.9 below, if
formed, the PB&J shall also meet with the City Manager on a semi-annual basis to discuss
SMG's progress in achieving its goals and conducting activities. Moreover, if the PB&J is
formed, SMG shall present drafts of its proposed Tourism Budget, all One-Year Plans, any
amendments thereto, and all other similar documents to the PB&J for review and comment
before SMG presents the same to Qre City Council for approval."
2. The Second Sentence of Section 5.1, Tourism Budget, is changed to read,
"Each new Fiscal Year during the tern of this Agreement, the new Tourism Budget shall
be determined by adjusting the prior year's budget by such amount as is determined by the City
Council,"
01003/0002135318,01 zo
Comments on Tourism Agreement
October 19, 2004
Page 2
3. The last sentence of Section 6.3,Visitor Center Inspection, is changed to read:
"However, if any employee of SMG observes or is advised by a third party of a defect or
other problem with the facility, SMG shall immediately provide the City Manager with written
notice of such issue."
4. The first sentence of Section 10.2,Notice and Right to Cure, is changed to read:
"In the event of tennination pursuant to Section 10.1(b), City shall give SMG written
notice of the grounds for tenninatiom"
S. Section 11.1(n), regarding an Event of Default, is changed to read:
"Failure to perform any other material obligation under this Agreement (including,
without limitation, SMG's failure to meet the responsibilities of SMG set out in Section 3.2 and
the Performance Standards set out in Section 3.3), if such failure to perform is not cured within
the period specified in the notice given to the defaulting party."
01003/0002/35319.01
CITY OF PALM SPRINGS
AGREEMENT FOR TOURISM SERVICES
By and Between
THE CITY OF PALM SPRINGS,
a municipal corporation
and
SMG,
a Pennsylvania general partnership
01003/0002/29740.07
CITY Or PALM SPRINGS
AGREEMENT FOR TOURISM
THIS CONTRACT SERVICES AGREEMENT ("Agreement") is made and entered into
this lst day of October, 2004 ("Effective Date"), by and between the CITY OF PALM
SPRINGS, a municipal corporation, ("City") and SMG, a Pennsylvania general partnership
("SMG").
RECITALS
A. City desires that the "Bureau of Tourism" of the City, as defined below, be
managed, operated, marketed and promoted in a professional manner with the objectives of
promoting the City as an attractive venue to international, national and regional visitors for
recreational, cultural, educational, enterlaimnent, professional, social, corporate and other
activities.
B. City has determined that it is in its best interests to delegate the responsibility for
the management, operation and marketing of its Bureau of Tourism to a private management
company with the experience and expertise in the management, operation and marketing of a
City's Bureau of Tourism.
C. SMG is an organization whose principals have substantial experience and
expertise in the management, operation and marketing of recreational, cultural, educational,
entertainment, professional, social, corporate and other activities-
D. SMG was previously engaged to manage, operate, promote and market the City's
Bureau of Tourism.
E. City is desirous of retaining and engaging SMG to manage, operate, promote and
market the Tourism Departrnent to assist in meeting the objectives set forth in this Agreement
and SMG desires to accept said engagement, all on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS AND CONTRACT INTERPRETATION
1.1 Definitions. In addition to other terms which are defined elsewhere in this
Agreement, the following terms, for purposes of this Agreement, shall have the meanings set
forth in this Section:
"Bureau of Tourism" shall mean that department which oversees the operation of
facilities and activities that promote the City to visitors as an attractive locale for recreational,
cultural, educational, entertairnnent, professional, social, corporate and other activities. Such
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department also oversees the dissemination of information and assistance to visitors with respect
to programs, events and facilities provided by the City or private persons or organizations within
the City, as well as the operation of all facilities in the City, including but not limited to, the two
Visitor Centers, which provide information services relating to tourism and the promotion of the
City.
"City Council" shall mean the City Council of the City of Palm Springs.
"Director of Tourism" shall mean the Executive Director of the City's Bureau of
Tourism.
"Fiscal Year" shall mean the year beginning July 1 and ending June 30.
"Nonconvention Hotels" shall mean those Hotels (as that term is defined in the Palm
Springs Municipal Code Section. 3.24.020) which do not have access to convention facilities
used for the provision of business, entertainment, social or other activities. Nonconvention
Hotels specifically exclude those hotels which are defined as a "Group Meeting Hotel" in the
Palm Springs Municipal Code Section 3.24.020.
"Tourism Budget" shall mean the compensation payable to SMG, pursuant to Article 5,
for SMG's performance of all of the duties required under this Agreement, excluding "Special
Events." The Tourism Budget shall be equal to the line item budget allocated to the Bureau of
Tourism, which comprises all of the funds allocated for the operation of the Bureau of Tourism
for a Fiscal Year.
"Palm Springs Tourism" shall mean the activities undertaken by the Bureau of Tourism
and/or the City to promote the growth and success of the entire hospitality industry in the City.
"Special Events" are recreational, cultural, educational, entertainment, professional,
social, corporate and other activities and events which the City Council has: (1) authorized the
Director of Tourism to participate in on behalf of the City and (2) allocated funding in addition
to the Tourism Budget, as further defined in Section 5.1.
"Visitor Center" shall mean any and all portions or parts of both of the Palm Springs
Visitor Centers, and all furniture, fixtures and equipment contained therein. At the time of
execution of this Agreement, the two centers are located at: 2901 N. Palm Canyon Drive
("Primary") and 777 N. Palm Canyon Drive ("Secondary"). The Primary Visitor Center is
owned by the City and used by SMG for no cost in lieu of an allocation to the Tourism Budget.
The Secondary Visitor Center is leased by SMG from a private party and is paid with an
allocation from the Tourism Budget. Both facilities shall be operated as public facilities.
1.2 %ternretation.
a. Gender and Plurality. Words of the masculine gender mean and include
correlative words of the feminine and neuter genders, and vice versa. Words importing the
singular number mean and include the plural number, and vice versa, unless the context demands
otherwise.
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b. Headings. Any captions or headings following an Exhibit, Section,
Subsection, Paragraph or Article number and preceding the operative text thereof shall be for
convenience of reference only and shall not in any way control or affect the scope, intent,
meaning, construction, interpretation or effect thereof.
C. References to Parts. References to Sections and Articles refer to
Sections and Articles hereof, unless specified otherwise. References to Exhibits refer to Exhibits
attached hereto.
d. Examples. Uses of examples are for purpose of illustration only. In the
event of any ambiguity or conflict between the examples and the provisions which they illustrate,
the provisions shall govern.
1.3 Integration. This Agreement contains the entire agreement between the parties
with respect to the transactions contemplated hereby. This Agreement shall completely and fully
supersede all prior understandings and agreements between the parties with respect to such
transactions, including those contained in any documents as part of the contract negotiations
completed on the Effective Date. All Exhibits and attachments referenced herein are
incorporated by reference.
1.4 Consistency with Law and Seveirability. The authority granted by City to SMG
by this Agreement shall be interpreted to be consistent with all applicable state and federal laws,
now in effect or adopted during the term of this Agreement, and the scope of this Agreement
shall be limited by all applicable current and developing laws and regulations. If, due to an
inconsistency with the law, any clause, sentence, provision, Subsection, Section or Article hereof
or Exhibit hereto shall be determined to be invalid, whether ruled invalid in any judicial
proceeding or be deemed likely to be invalid due to legislative, administrative or judicial
precedent, then the parties shall:
a. Promptly meet and negotiate in good faith a substitute for such provision
which shall, to the greatest extent legally permissible, affect the intent of the parties herein_
b. If necessary or desirable to accomplish the preceding item (a) above, apply
to the court or administrative body having declared such invalidity for a construction of the
substituted portion of this Agreement.
c. Negotiate such changes in, substitutions or additions to the remaining
provisions hereof as may be necessary in addition to and in conjunction with preceding items (a)
and(b) above to affect the intent of the parties in the invalid provision.
To the extent possible, the invalidity of such provision shall not affect any of the
remaining provisions hereof, and this Agreement shall be construed and enforced as if such
invalid provision did not exist.
1.5 Construction of 'Perms. This Agreement shall be interpreted and construed
reasonably, neither for nor against either party, regardless of the degree to which either party
participated in its drafting. The terms and provision of this Agreement shall be construed in
accordance with the meaning of the language used and in a mamier which carries out the
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purposes of this Agreement. SMG acknowledges that it determined to participate in the
procurement of this Agreement upon its choice and initiative with full knowledge of the terms,
conditions and risks of participation. The parties have negotiated this Agreement at arms length
and with advice of their respective attorneys, and no provision herein shall be construed against
the City solely because it prepared this Agreement in its executed form.
1.6 Licenses, Permits, Fees and Assessments. SMG shall obtain at its sole cost and
expense such licenses, permits and approvals as may be required by law for the performance of
the services required by this Agreement. SMG shall have the sole obligation to pay for any fees,
assessments and taxes, plus applicable penalties and interest, which may be imposed by law and
arise from or are necessary for SMG's performance of the services required by this Agreement,
and shall indemnify, defend and hold the City harmless against any such fees, assessments, taxes,
penalties or interest levied, assessed or imposed against City hereunder. All costs incurred
hereunder shall be paid with the Tourism Budget, as that tern is defined in Section 5.1.
ARTICLE 2
GRANT OF AUTHORITY AND TERM OF AGREEMENT
2.1 Grant of Authority. Following the Effective Date and for the Term provided for
herein, City hereby grants to SMG, and SMG hereby accepts, the exclusive right and obligation
to manage, operate, market and promote the City as an attractive venue to international, national
and regional visitors for recreational, cultural, educational, entertainment, professional, social,
corporate and other activities, in accordance with all legal requirements, pursuant to the terms
and subject to the limitations of this Agreement.
2.2 Acceptance and Effective bate. SMG shall accept this Agreement on the terms
and conditions set forth in this Agreement, and the grant of authority shall be effective upon the
last to occur of the following:
a. Approval by City Council at a regularly scheduled meeting;
b. Execution by both parties;
V. Filing of certificates of insurance;
d. Payment of any required fees; and
C. Filing with the City Clerk of written acceptance by SMG.
The foregoing conditions must be satisfied within thirty (30) days of the approval of the
Agreement by City Council or the authority granted heretmder will be null and void.
Notwithstanding the foregoing, upon satisfaction of the above conditions, the date of
commencement of the Agreement shall be deemed to be July 1, 2004,the Effective Date.
2.3 Term. The "Term" of this Agreement shall begin on the Effective Date and shall
expire at the close of business on June 30, 2008. Notwithstanding the foregoing, City may
terminate this Agreement pursuant to Section 10.1 with or without cause on thirty (30) days'
notice. The Tern may be extended once for five (5) years, at the City's sole option, provided
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that the City is fully satisfied with SMG's performance under the Agreement and City determines
that it is in the best interest of the City to approve an extension for such time, by giving SMG
written notice of City's election to extend this Agreement at least one hundred eighty (180) days
prior to the date of termination.
2.4 City's Authorized Representative; Approval.
a. City hereby designates the City Manager to be its "Authorized
Representative" who shall act as a liaison and contact person between City and SMG in all
matters concerning this Agreement. City shall have the right to change the person who is its
"Authorized Representative" by giving SMG written notice thereof.
b. Except for Budget approvals, which are approved by the City Council, if
SMG desires to do any act hereunder which requires City's prior consent thereto or prior
approval thereof, SMG shall submit to the City Manager a written summary of the proposed act
and a request for City's consent thereto or approval thereof. The City Manager shall respond to
such request within thirty (30) days and SMG shall not act tmless and until the City Manager has
responded. However, failure of the City Manager to respond in such time frame shall not waive
the requirement that SMG obtain the City Manager's approval.
2.5 Authority of SMG. Except as otherwise specifically provided in this Agreement,
SMG shall have the exclusive right and authority to exercise, or delegate the exercise of, all
rights, powers and duties conferred or imposed on SMG in this Agreement. Subject only to the
limitations expressly set forth in this Agreement, SMG shall have complete discretion with
respect to the operation of the Visitor Center.
2.6 Employees. Employees hired by SMG shall be employees of SMG and not of
City. SMG shall have complete and absolute discretion and authority with respect to the
number, functions, qualifications, compensation and other terms and conditions relating to its
employees, subject only to the provisions of Article 12 of this Agreement.
2.7 'Visitor Center Use and Purchase of Supplies and Services. SMG shall have
the exclusive use of the Visitor Center, which is leased from the City, including the authority and
discretion to contract for the purchase of all equipment, materials, supplies and inventories
reasonably required by SMG hereunder. SMG shall make all such purchases at the best available
price known to SMG, considering the quantities required, the time available for the delivery and
the sources of supply. SMG shall keep written records for each purchase of all efforts made to
accomplish the best price and the justification of the purchase, which records shall be available
to City. All equipment, materials and supplies purchased by SMG shall be property of the City.
SMG and shall be prudent when purchasing all equipment, supplies and materials to be used. All
funds earned by the Visitor Center are revenue to the City, shall be accounted for as such on a
quarterly basis and shall be reinvested in Palm Springs Tourism.
2.8 Representations and Warranties. Each party represents and warrants to the
other that (i) it has the full power and right to enter into and fully perform this Agreement, (ii) it
is under no contractual or other legal obligation, and there exists no lien or claim which will in
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any way interfere with its full, prompt and complete performance hereunder, and (iii) the
individual executing this Agreement on its behalf has the authority to do so.
2.9 Time of Essence. Time is of the essence in the performance of this Agreement.
2.10 Force Mai eure. Neither party shall be liable or responsible to the other party for
any delay, damage, loss, failure or inability to perform, and the time for performance hereunder
may be extended during the term of such delay only, due to unforeseeable causes beyond the
control and without the fault or negligence of SMG, including, but not restricted to, acts of God
or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics,
quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any
governmental agency, including the City, if SMG shall within five (5) days of the
commencement of such delay notify the City Manager in writing of the causes of the delay. The
City Manager shall ascertain the facts and the extent of delay, and extend the time for performing
ed. The City Manager's determination shall be final a
the services for the period of the enforced delay when and if, ill the judgment of the City
Manager such delay is justifind conclusive
upon the parties to this Agreement. In no event shall SMG be entitled to recover damages against
the City for any delay in the performance of this Agreement, however caused, SMG's sole
remedy being extension of the Agreement pursuant to this Section.
ARTICLE 3
RESPONSIBJLITIES OF SMG
3.1 Mission Statement for Palm Springs Tourism. The Palm Springs Bureau of
Tourism is the City's official destination marketing organization whose focus is to promote the
City to consuners, the media and domestic and international trade buyers, thus increasing the
transient occupancy taxes and sales taxes generated for the City, and increasing the City's
exposure as a world-class year-round leisure destination. SMG shall be responsible for
conducting its activities with respect to Palm Springs Tourism in a manner which is consistent
with this mission statement.
3.2 Responsibilities of SMG. From the Effective Date of this Agreement through
the end of the Term, or such other termination date made pursuant to the terms of this Agreement,
SMG shall, consistent with this Agreement and subject to the then-applicable Tourism Budget,
perform the following responsibilities:
a. Manage, operate, maintain and promote the Visitor Center, Palm Springs
Tourism and authorized Special Events in a manner that is consistent with tourism industry best
business practices for planning and development of an effective visitor bureau operation that
promotes Palm Springs Tourism in a manner that provides focus of effort and results. On behalf
of Palm Springs Tourism, SMG shall fulfill the role of "umbrella" marketer under which
umbrella stands the extensive collection of businesses which promote their own products and
services and are involved in servicing travelers. Industries which fall under the umbrella include,
but are not limited to, transportation, accommodations, food service, retail, attractions,
convention center services, and outdoor and cultural heritage agencies and entities-
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below. b. Prepare the annual business marketing plans as ,required in Section 3.5
c. Seek City Council' approval of Special Events in which the Bureau of
Tourism would like to participate. hcn presenting such a request, the Director of Tourism
shall present the City Council with a staff report outlining the event theme, the desired
participants, how the event will be marketed, dates and scheduling, how the event will be
conducted, needed resources, impacts on businesses and the community, and other factors. A
financial pro forma shall be included showing sources of revenue from sponsorships, tickets,
food and beverage sales and other sources all costs, and any assistance requested from the City,
including in-kind assistance, and contributions from SMG. Any such Special Event shall comply
with the City's regular procedure for such Special Events, including being processed through the
City's internal staff committee review. A written agreement, with performance thresholds and
measurement criteria and which specifies the assistance to be provided by the City, if any, and
which retains the City's ability to cancel or withdraw its participation within a reasonable time
prior to the Special Event shall be provided consistent with City standards.
d. Maximize marketing finds and results by leveraging increased marketing
support and synergism with other principal partners, including the Convention Center and the
Palm Springs Desert Resorts Convention and Visitor Authority.
e. Develop a tracking system that benclnnarks Palm Springs Tourism
promotional activity and resulting productivity, including return on investment, for the
community.
the SMG audit.£ Deliver an enhanced management system consistent with the findings of
g. Poster an enhanced community relations plan that builds strong,
supportive stakeholder consensus.
h. Negotiate, execute and perform contracts, use agreements, licenses and
other agreements: (1) with persons who desire to schedule events, performances, and other
activities .for the promotion of or in furtherance of Palm Springs Tourism, or (2) that otherwise
pertain to the operation, marketing or promotion of the Visitor Center and/or Palm Springs
Tourism. All contracts (i) with a tern of two (2) or more years, or (ii) with significant financial
implications (e.g. leases, sponsorships, selling trademarks, Special Events logos and naming
rights), or (iii) similar contracts must be reviewed by the City Attorney and approved by the City
Council.
for contracts. i. Comply with the SMG's procurement policies requiring a bidding process
j. Establish and maintain consistent procedures for cost estimating and
reporting, maintenance and payment of invoices, including preparation of the Tourism Budget, a
line item budget as described in Section 5.1(a), and reports as contemplated by Article 8.
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k. Monitor actual and projected operating expenses incurred by SMG in the
perfonnance of its duties under this Agreement. Make prompt payment of all expenses from
funds made available for that purpose; however, nothing herein shall prohibit SMG from
reasonably contesting the validity of any claim made against SMG.
3.3 Performance Standards. SMG agrees to:
a_ Manage, operate and promote Palm Springs Tourism so as to conduct all
activities within the Tourism Budget, subject to the terms and conditions in this Agreement,
consistent with tourism industry best business practices for planning and development of an
effective visitor bureau operation. However, in establishing and implementing its booking
policies, SMG may schedule not only those events that generate substantial direct revenue to the
Tourism Department, but also those events that produce less direct revenue but will generate
either a significant economic, recreational, cultural, educational, entertainment, professional,
social, or other benefit to City or otherwise serve the public interest-
b. Be effective in plarming and participation in Special Events.
C. Generate positive awareness of the City as a destination choice for leisure
travelers.
d. Stimulate interest and desire on the part of domestic and international
customers to take action and visit.
C. Maximize the length and frequency of stay to increase economic
generation and enhance the value of the visitor experience.
f. Increase the business volume of the Bureau of Tourism's business partners
and constituents.
g. Leverage marketing efforts by proactively working with other agencies to
develop an expanded benefit program on behalf of City constituents.
h. Monitor the effectiveness of the work of the Bureau of Tourism,
quantifying the return on the investment produced for the community.
i. Create positive awareness, support and participation in the Bureau of
Tourism and its marketing programs on behalf of the government, industry and residents.
j. Perform its obligations under this Agreement in accordance with all legal
requirements of all governmental authorities having jurisdiction over such obligations, or any
part thereof.
k. Maintain all facilities operated under this Agreement in good condition,
reasonable wear and tear excepted, and continue maintenance procedures which will keep such
facilities in good condition and working order, reasonable wear and tear excepted.
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1. Promptly and fully discharge and pay all of its obligations under this
Agreement at or prior to the times specified for performance or payment; provided, however, that
nothing herein shall prohibit SMG from reasonably contesting the validity of any claim against
SMG (any such claim due and owning to be promptly paid by SMG upon the conclusion of such
dispute by final non-appealable judgment or otherwise).
3.4 Duty and Liabilitv. SMG shall owe to City a duty to perform its obligations
under this Agreement and to conduct the management and operation of the Visitor Center at all
times consistent with tourism industry best business practices and in accordance with the
business plan required pursuant to Section 3.5 below. SMG shall not be liable, responsible or
accountable in damages or otherwise to City or to any other person for any act or omission that is
within, or that SMG reasonably believes to be within, the scope of its authority under this
,Agreement; provided, however, that SMG shall be liable for that portion of any loss sustained by
City or any other person which is caused by:
a. Acts or omissions of SMG, its agents, employees or officers acting in bad
faith or proximately resulting from the negligence or intentional misconduct of SMG or its
agents, employees or officers; or
b. Any transaction from which SMG, or its agents, employees or officers
derives an improper personal benefit; or
c. Any Event of Default (as defined in Article I I below) on 4-ue part of SMG
or its agent, employee or officer.
3.5 One-fear Plan. Each year during the Term, except during the initial year of the
,Agreement, on or before February 1st, SMG shall submit the "One-Year Plan," which is a
proactive business marketing plan which includes a detailed list of each of the programs and
duties SMG shall perform pursuant to this Agreement for the next Fiscal Year, to the City
Manager for approval by the City Council. The One-Year Plan shall incorporate strategies to
achieve the performance standards set forth in Section 3.3, above. In the initial year of this
Agreement, SMG shall be required to subunit its One-Year Plan no later than January 1, 2004.
SMG shall prepare the One-Year Plan in addition to any other docuuments, proposals or
reports required by this Agreement. The City Council shall review, and if appropriate, approve
the One-Year Plan_ If the City Council rejects the One-Year Plan, SMG shall resubmit a new
One-Year Plau to effectuate the requests of, and to address all comments from, the City Council
within fourteen (14) days of SMG's receipt of comments from the City Council. SMG shall be
required to revise and resubmit the One-Year Plan until the plan is approved by the City Council.
SMG shall perform its obligations under this Agreement as authorized pursuant to the approved
One-Year Plan.
a. One-Year Plan Outline. Each One-Year Plan shall include the
following:
1. An Executive Summary, including a detailed review of the
implementation process.
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2. A discussion of the prior One-Year Plan, if any, and the extent to
which the objectives were achieved and an explanation thereof.
3. A discussion of the "Destination Marketing Process", including an
explanation of how new visitor business will be attracted through coordinated community and
stakeholder action.
4. An introduction which sets forth the marketing mission and a
statement of how value will be created.
5. A list of major objectives which will serve as the parameters of the
plan development_
6. A list of marketplace complications which act as or are perceived
to be impediments to success, which include major challenges, such as competitive city hotel
inventories, other marketing budgets, economic conditions, and other conditions which may
unfavorably impact SMG's ability to create customer share of mind and market.
7. A forecasting of trends along with marketplace opportunities
where new doors to success can be opened.
8. The Director's Report and Productivity Goals.
9. A comprehensive marketing calendar.
10. A detailed budget-
b. Director's Report. and Productivity Goals. This portion of the One-
Year Plan shall include discussions of the following issues.-
1. Specific market segment/program missions.
2. Relevant national trends.
3. Current year productivity and activity achievements.
4. Planned highlights for the new year.
5. Projected goals in firm numbers, comparing the numbers to the
work of the current year.
6. Each market segment, incorporating the marketplace complications
of each area.
7. Competitive analysis.
8. Major strategies to be undertaken.
9. Primary target audiences to be reached_
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10_ Specific tactics or work programs to accomplish the strategies.
C. Marketing Calendar. The marketing calendar should list all major
strategies by month, containing trade shows; sales forums and sales missions to be undertaken;
media relations, advertising and direct mail placed; publications and collateral to be produced;
major partnership development initiatives, and similar items.
d. Budget. A high impact, edited version of the budget required pursuant to
Section 5.1 should be included in the One-Year Plan.
e. Markct Segments. The One-Year Plan shall include a description of
marketing mechanisms and media buys related to overall and niche market segments identified
as a part of the annual marketing plan.
f. Other Plan Components. The One-Year Plan shall specifically discuss
how it will serve the interests of various market segments such as non-convention and small
hotels, convention hotels, gay hotels and others. In addition, the One-Year Plan may consider
the interface of the One-Year Plan with the Palm Springs Desert Resorts Convention and Visitor
Authority, the Palm Springs International Airport, the Convention Center, the Chamber of
Commerce and other institutions. The One-Year Plan shall also consider how to foster
community partnerships, Special Events and other matters.
3.6 Operation of Visitor Center. SMG shall operate the Visitor Center, which shall
include the operation of(i) the reservation service and (ii) the information center. As technology
evolves, the parties may agree to revise the required operating mechanisms. SMG shall assure
that it will perform all duties and operations of the Visitor Center, pursuant to City rules and
standards. SMG shall further describe in the One-Year Plan methods it shall employ to modify
and improve the operation of the Visitor Center aimed at making it more efficient, accessible and
informative to international, national and regional visitors.
3.7 Staff. SMG, as part of the Tourism Budget, shall provide offices for the Bureau
of Tourism staff in such location as SMG shall select, as is necessary for SMG to perform its
obligations under this Agreement. SMG shall bear the entire costs of providing offices for
Tourism staff.
3.8 Planning, Budgeting Joint Advisory Committee. With the approval of the City
Manager, the Director of Tourism may Pone a Planning, Budgeting Joint Advisory Committee
PB&J" to advise the Director of Tourism. The Director may form the PB&J to consist of a
group which reflects the broad spectrum of tourism within the City, including representatives of
large hoteliers, medium hoteliers, small hoteliers, gay tourism, the Uptown merchants
association, the Mainstreet association, restaurateurs, the Convention Center, significant
attraction venues, and other similar groups_ if a PMJ is formed, the Director may, in his or her
sole discretion, refer issues to the PB&J relating to any aspects of Palm Springs Tourism
including, but not limited to, marketing, Special Events, coordination of activities with
downtown businesses, the Tourism Budget, the One-Year Plan, changes to the Tourism Budget
or the One-Year Plan, the Service Review required pursuant to Section 6.5, the Annual
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Performance Review required pursuant to Section 6.6 and the other responsibilities of SMG as
set forth in Section 3.2. If a PB&J is formed, as soon as possible after the PB&J is formed, the
Director of Tourism shall meet with the PB&J and the City Manager to establish goals and
activities to promote Palm Springs Tourism. As discussed in Section 3.9 below, if formed, the
PB&J shall also meet with the City Manager on a semi-annual basis to discuss SMG's progress
in achieving its goals and conducting activities. Moreover, if the PB&J is formed, SMG shall
present drafts of its proposed Tourism Budget, all One-Year flans, any amendments thereto, and
all other similar documents to the PB&J for review and continent before SMG presents the same
to the City Council for approval.
3.9 Monitorin¢ of Performance and Cha—,es to One-Year Plan. The Director of
Tourism shall meet with the City Manager within ten (10) days of the execution of this
Agreement to establish goals and activities to promote Palm Springs Tourism to be undertaken in
the first six months of the Agreement, and the City Manager, and/or the PB&J, if a PB&J is in
existence, and a representative of the Convention Center shall then meet on a quarterly basis to
review the audit reports and SMG's progress in achieving its goals and conducting activities
during the previous quarter, as well as to prepare a list of new goals and activities for the
following quarter. Any significant change in the tourism program contained in the One-Year
Plan shall first be approved by the City Manager.
ARTICLE 4
COORDINATION OF WORD
4.1 Director of Tourism. Subject to the approval of the City Council, SMG shall
select a Director of Tourism in the mariner described in this Section to act as the principal and
representative of SMG on its behalf with respect to the work specified herein and to make all
decisions in connection therewith. The Director of Tourism's duties include, but are not limited
to, the supervision of SMG's compliance with all duties and obligations imposed upon SMG
under this Agreement. The Director of Tourism shall perform her supervisory dirties for the
City.
SMG has appointed Mark Bellinger as the Executive Director of Tourism. Should SMG
need to replace Mr. Bellinger as the Director of Tourism, a new Director of Tourism shall be
selected in the following manner_
a. In response to solicitation for the position of Director of Tourism to
oversee the operations of the Visitor Center and Palm Springs Tourism, SMG will obtain a
significant number of applications and/or resumes for such position;
b. SMG shall recommend to the City Council such prospective candidate to
oversee the operation of the Visitor Center and Palm Springs Tourism as required under this
Agreement, at which time, or as soon thereafter as the City Council "nay act, the City Council
shall, in its sole discretion, ditly approve or disapprove such prospective candidate; and
C. If the City Council disapproves of the prospective candidate pursuant to
the above, SMG shall consult with another prospective candidate and resubmit such selection to
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the City Council. SMG shall continue the process required under this Section until such time as
the City Council approves a prospective candidate.
4.2 Expertise of SMG's Representatives. It is expressly understood that the
experience, knowledge, capability and reputation of the Director of Tourism is a substantial
inducement for City to enter into this Agreement. Therefore, the Director of Tourism shall be
responsible during the term of this Agreement For directing all activities of SMG and devoting
sufficient time to personally supervise the services hereunder. For purposes of this Agreement,
the Director of Tourism's responsibilities may not be substantially reduced by SMG without the
express written approval of the City Manager.
4.3 Termination of the Director of Tourism. SMG has the complete discretion to
elect to terminate the Director of Tourism. However, SMG shall give the City Manager written
notice at least one (1) week prior to terminating the Director of Tourism.
ARTICLE 5
SMG COMPENSATION
5.1 Tourism Budget. For the services rendered pursuant to this Agreement, the City
shall pay to SMG an amount equal to the Tourism Budget, as that term is defined at Section 1.1
and this Article 5, The Tourism Budget for the 2004-2005 Fiscal Year shall be $1,481,516.
Each new Fiscal Year during the term of this Agreement, the new Tourism Budget shall be
determined by adjusting the prior year's budget by such amount as is determined by the City
Council. The Tourism Budget includes, but is not limited to compensation for all SMG
employees performing services hereunder, marketing and promotion costs, and reimbursement
for actual and necessary expenditures made by SMG in the operation of Palm Springs Tourism
of whatever kind, including but not limited to, reproduction costs, telephone expenses. The
Tourism Budget shall include the attendance of all necessary members of the Bureau of Tourism
at all project meetings reasonably deemed necessary by the City; SMG shall not be entitled to
any additional compensation for attending said meetings.
a. Line Item Budget. No later than March 1st in each Fiscal Year that the
Agreement is in effect, that the Agreement is in place, SMG shall provide the City Manager with
a proposed line item budget for the Tourism Budget for the upcoming Fiscal Year.
The line item budget shall be prepared in accordance with City's budgetary practices and
all applicable laws and regulations and shall correlate to the One-Year Plan for the upcoming
Fiscal Year. All Special Events shall be listed as separate line items. Prior to implementation
and award of the Tourism Budget for an ensuing year, the line item budget shall be subject to
approval by the City Council.
Once the line item budget is established, SMG shall attempt to adhere to the budget,
provided that SMG may reallocate funds between budget categories when, in SMG's good faith
judgment, such reallocation is prudent, provided that a written justification shall be prepared for
such reallocation which shall be available for review by the City.
b. Tourism Budget Amount. Each Fiscal Year during the term of this
Agreement, the total Tourism Budget will be established by a resolution which is adopted by the
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City Council as part of the City's annual fiscal budget. The Director of Tourism shall submit the
proposed Tourism Budget for each upcoming Fiscal Year as set forth in Section 5.l(a).
c. Expenditures in Excess of Budget. SMG shall not, without written
authorization by City, knowingly incur in any Fiscal Year obligations in excess of the total then-
applicable Tourism Budget approved by City. In the event SMG becomes aware of any such
obligations, SMG shall immediately inform City in writing of the nature, amount and due date
for such obligations, and written instructions as to how to proceed. Excessive expenditures, the
failure to notify the City of such expenditures or the failtrre to follow the City's procedures shall
constitute a default.
5.2 Reduction/Elimination of Revenue Source. In the event of airy significant
reduction or elimination in City revenue sources, City has the right to zneet with SMG to work
out how to reduce compensation to SMG by a reduction in the Tourism Budget proportionate to
the reduction or elimination of the revenue source. If the parties fail to reach an agreement on
the reduction of the Tourism Budget, the City may terminate the Agreement within thirty (M)
days of the date in which the Parties fail to reach an agreement.
5.3 Payment Method. Each year during the term of this Agreement SMG shall be
paid the Tourism Budget in the rnanner described herein, which payments shall be deposited in
an account as described at Section 5.4 below ("Depository") in the name of SMG. Although all
funds within the Depository are subject to the ultimate control of the City, SMG shall have
authority to use the funds in the Depository for the performance of its duties under this
Agreement.
a. 'Visitor Center Net Revenues. SMG shall collect all operating revenues
of the Visitor Center and deposit them in the Depository, applying such funds and any interest
thereon first to the payment of operating costs of the Visitor Center and thereafter to SMG as
payment of part of the total Tourism Budget for SMG's services accrued through the end of the
prior month and thereafter to any other operating expenses of SMG then accrued_ SMG shall
retain all gross revenues from the operation of the Visitor Center for reinvestment in Pahn
Springs Tourism pursuant to a plan prepared by SMG after consultation with the PB&J and
approval by the City Council.
b_ Balance of Tourism Budget. City shall pay the balance of the Tourism
Budget to SMG in monthly installments, except as any payments may be reduced by the City's
advancement of funds under this Paragraph. SMG shall deposit payments tinder this Paragraph
in the Depository. As may be necessary from time to time, City will provide SMG with cash
advances sufficient to meet the operating expenses of Palm Springs Tourism. However, in no
event shall City advance any funds to SMG in excess of the Tourism Budget unless said advance
has been previously approved by the City Council.
5.4 Security for and Investment of Funds. All funds and accounts required to be
maintained by SMG under this Article 5 shall be maintained in the Depository, which shall be a
bank or branch located in the City. SMG shall require of the Depository that all funds held in
any accotmt maintained under this Article 5 be secured to such an extent and in such a manner as
is required by applicable law in correction with the deposit of funds of the City. Money on
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deposit in the Depository shall be retained on deposit in fully secured interest-bearing demand
deposit accounts or may be invested, to the extent and only if permitted by applicable laws, in
the following obligations or securities, maturing at such time or times so as to enable
disbursements to be made for the payment of operating costs and SMG's services: bonds or
other obligations of, or unconditionally guaranteed by, the United States of America or any
agency or instrumentality thereof or by the State of California.
5.5 No Obligation of Manager to Advance Funds. Notwithstanding any provision
of this Agreement to the contrary, SMG shall not be obligated to make any advance to or for the
account of City or to pay any stuns incurred for the performance of City, nor shall SMG be
obligated to incur any liability or obligation for the account of City, nor shall SMG be
responsible for the failure of its performance of its obligations hereunder as a result of City's
failure to provide sufficient funds as herein set forth. Further, notwithstanding any other
provision of this Agreement, SMG shall be obligated to perform its duties, responsibilities and
obligation hereunder only to the extent that funds are made available to SMG for such purpose.
ARTICLE 6
PERFORMANCE REVIEW
6.1 Time for Performance Review. SMG's performance shall be subject to an
annual "Performance Review "as set forth in this Article 6,
6.2 Components of Performance Review. The Performance Review may consist of
any or all of the following elements: (i) Visitor Center inspection, (ii) financial performance
review, (iii) a service review, (iv) an analysis of the annual audit conducted pursuant to Section
8.3 and (v) an analysis of the quarterly reports prepared pursuant to Section 8.4. The results of
the Performance Review shall be incorporated into a written report and shall be presented to the
City Council no later than February I" of each year of this Agreement, except for the initial year
of the Agreement, concurrent with the One-'Year Plan.
6.3 Visitor Center Inspection. A representative of the City shall be permitted to
perform an annual inspection of the facility and make recommendations on potential
maintenance improvements for the following fiscal year. "fhe annual inspection, if any, shall be
conducted by the City no later than February 15th of a given year so that any recommended
changes may be included in the budget for the next fiscal year. however, if any employee of
SMG observes or is advised by a third party of a defect or other problem with the facility, SMG
shall immediately provide the City Manager with written notice of such issue.
6.4 Financial Performance Review. A financial performance review shall evaluate
all information relevant to SMG's services provided under this Agreement. SMG shall gather
and provide to the City all information necessary for City to conduct the financial performance
review. The information shall include:
a. Calculations relating to SMG's expenditures as compared to each line item
within the Tourism Budget and each Special Event, and a written justification of any
discrepancies, particularly where the expenditures exceeded the budget.
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b. The annual building and facility audit report for the Visitor Center
pursuant to Section 6.3,
C. The amount of income generated at the Visitor Center.
d. A line item of all of the expenses incurred and revenue received by the
City and businesses within the City from all Special Events that the City has participated in
during the Fiscal Year.
e. A year over year comparison of total room nights booked in the City.
f. A summary of the new tour operator sales leads generated and the
attendant dollar value.
g. A summary of the partner support for the Bureau of Tourism, including
non-dues revenue provided for expanded marketing initiatives, along with the number of
partnership efforts.
h. A summary of positive media publicity impressions produced of credible
travel stories to influence travel decisions and the resulting dollar value in comparable
advertising space costs.
6.5 Service Review. The service review shall consist of a meeting between City, and
SMG and shall consider the services provided, the feasibility of providing new services,
customer complaints and SMG's responses to customer complaints. The information gathered
shall be compiled into an annual report which shall summarize the feedback received. Such
report may contain:
a. An analysis of whether SMG complied with each of the responsibilities set
forth in Section 3.2-
b. An analysis of whether SMG met the each of the performance standards
set forth in Section 3.3.
c. Recommended changes and/or new services to decrease operating
expenses and operating losses or to increase operating reviews.
d. Specific plans for provision of changed or new services by SMG.
e- Responses to any issues which have been raised concerning services
performed by SMG.
f. Recommendations regarding Special Events, whether to participate in new
events or discontinue or step down participation in specific events.
SMG may submit any relevant performance information and reports for consideration. in
addition, City may request that SMG submit any other specific information relating to its
perfonnance-
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The purpose of a service review is to assure that services are provided of the highest
quality, that the Visitor Center and Palm Springs Tourism are operated in an manner which is
superior to the average facility and services in their respective competitive markets, both as to
size and region, and in full compliance with the terms of this Agreement.
6.6 Preparation of Annual Performance Review.
a. Time to Prepare. The Visitor Center inspection shall be conducted
between January 1 and January 15 every year on a date mutually agreed by the parties so that all
the findings can be incorporated in the Performance Review report which shall be presented to
the City Council no later than February I" of each year, as part of the City's budget process. All
other components of the Performance Review shall be submitted to the City within ninety (90)
days following the conclusion of the Fiscal Year.
b. Response by City. Upon receiving the materials submitted by SMG, City
may schedule a meeting with SMG to review the materials and all components of the
Performance Review. Within forty-five (45) days of the submittal, City shall prepare a written
draft Performance Review and submit the same to SMG for SMG's review and comment. SMG's
comments shall be submitted within fifteen (15) days of SMG's receipt of the City's draft
Performance Review, and such comments shall be considered by City before the City Manager
Finalizes the Performance Review. Where SMG's performance is found to be substantially
defective,the parties shall meet and confer,pursuant to Section 6.7.
As a result of the Performance Review, the City may conclude that SMG's performance
in the prior Fiscal Year: (i) was excellent, (ii) raises issues of concern to be monitored in the
current Fiscal Year, or (iii) was substantially defective. in the event the Performance Review
finds issues of concern, the report shall identify proposed corrective actions to be taken.
6.7 Meet and Confer Process. Whenever the parties are required to meet and confer
pursuant to the terms of this Agreement, the parties shall have thirty(30) days from the receipt of
written notice from the other party to meet and confer in person, and in good faith, in an attempt
to resolve the dispute between the parties. If the matter cannot be resolved through the meet and
confer process, it may be deemed a default pursuant to Article 1 I.
6.8 New or Expanded Services. As a result of its findings following any
Performance Review, the parties may agree for SMG to provide improved, expanded or new
services within a reasonable time. If the reason that the City requests new or expanded services
is not remedial, SMG may request additional compensation for such services if they are beyond
the scope of this Agreement.
6.9 Service Materials I3eloni= to City. All data, reports, documents, brochures,
survey materials, and other computerized, written, printed, or photographic materials developed
by City or SMG in connection with the services, whether developed directly or indirectly by City
Or SMG, shall be and shall remain the property of City without limitation or restriction on the use
of such materials by City. SMG shall )-rot use such materials in connection with any project not
connected with this Agreement without the prior written consent of City.
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ARTICLE 7
INSURANCE AND INDEMNIFICATION
7.1 Insurance to be Maintained by SMG. Throughout the term of this Agreement,
SMG shall procure and maintain the following policies of insurance:
a. Workers' Compensation. Such workers' compensation insurance
coverage as may be required by law, including employer's liability coverage of at least
$3,000,000 per person per occurrence. Said policy shall be procured and maintained at SMG's
sole cost and expense and in a form and content satisfactory to the City-
b. Crime and Fidelity Coverage. At least $100,000 per occurrence of
coverage for (i) employee dishonesty; (ii) forgery or alteration; (iii) theft, disappearance and
destruction inside and outside the Visitor Center; and (iv) robbery and safe burglary inside and
outside the Visitor Center. Such insurance shall name City as additional named insured. Said
policy shall be procured and maintained at SMG's sole cost and expense and in a form and
content satisfactory to the City.
C. Comprehensive General Liability. As SMG has elected to use the City's
self-insurance for its comprehensive general liability insurance, SMG shall reimburse the City
from the Tourism Budget for comprehensive general liability insurance written on a per
occurrence basis. The policy of insurance shall be in an amount not less than either (i) a
combined single limit of $5,000,000.00 for bodily injury, death and property damage or (ii)
bodily injury limits of $1,000,000.00 per person, $2,500,000.00 per occurrence and
52,500,000.00 products and completed operations and property damage limits of$1,000,000.00.
d. Other Insurance. Such other coverages as SMG, in its discretion, may
deem prudent or necessary, or such other insurance, including professional liability insurance, as
may be required by the City.
e. Other Insurance Provisions. The insurance required by this Agreement
shall be with insurers which are Best A-rated or better. The City shall be included as an
additional insured on each of the policies and policy endorsements required to be maintained by
SMG. SMG shall obtain the written consent of the City's Risk Manager prior to changing
insurers providing insurance under this Agreement, which consent shall not be withheld
unreasonably. The following language will be made a part of all insurance polices required by
this Section:
1. "The City of Patin Springs, its employees, agents, franchisees and
officers are hereby added as additional insureds with respect to liability arising out of activities
performed by or on behalf of SMG."
2. "This policy shall be considered primary insurance with respect to
any other valid and collectible insurance the City of Patin Springs may possess including any
self-insured retention the City of Palm Springs may have, and any other insurance the City does
possess shall be considered excess insurance and shall not contribute with it,"
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3. "This policy shall act for each insured as though a separate policy
had been written for each. This, however, will not act to increase the limit of liability of the
insuring company."
4. "Thirty (30) days' prior written notice by certified mail, return
receipt requested, shall be given to the City of Palm Springs in the event of suspension,
cancellation, reduction in coverage or in limits or non-renewal of this policy for whatever reason.
Such notice shall be sent to the City Manager, City Attorney and City Clerk."
7.2 Insurance to be Maintained by the City. Throughout the tern of this
Agreement, City shall at all times maintain in effect the following policies of insurance:
a. Property Insurance. An "All Risk of Physical Loss" form of policy
(with Replacement Costs Endorsement), insuring all movable and immovable property
constituting the Primary Visitor Center excluding the foundation (including the expense of the
removal of debris of such property as a result of damage by an insured peril), subject to the terms
and conditions of the insuring agreements, including coverage for loss or damage by earthquake
and flood. Such insurance shall name SMG as an additional named insured. Coverage shall be
on a broad "All Risk of Physical Loss" form. The Primary Visitor Center and its contents shall
be insured to full replacement value.
b. Comprehensive General Liability. Public liability and property damage
insurance with a combined single limit of at least $ 00,000 insuring against all liability of the
City and the City Manager arising out of, and in connection with, the use or occupancy of the
Primary Visitor Center. Such insurance shall name SMG as an additional named insured.
7.3 Insurance Policies. The insuring party as specified in this Article 7 shall deliver
to the other party copies of policies of such insurance or certificates evidencing the existence and
amounts of such insurance as required to be maintained hereunder. The parties specifically
acknowledge that obtaining such insurance policies will not limit their liability hereunder for
amounts in excess of such policies or diminish their respective duties to indemnify each other as
specifically set forth in this Agreement.
7.4 Indemnification of City. SMG agrees that it shall protect, defend, indemnify and
hold harmless City, its elected officials, officers, employees, volunteers and agents from and
against any and all losses, liabilities, fines, penalties, claims, damages or judgments, including
attorneys fees and costs ("Claims"), arising out of or resulting in any way from City's grant of
this authority to SMG or SMG's exercise of the authority including the provision of services
under this Agreement, unless such obligations:
a. Arise from the sole negligence or willful acts of City, its elected officials,
officers, employees, agents or contractors, or
b. Arise from any breach or default by the City of its obligations hereunder
or under any agreement between the City and a third party,
C. Are of the type that are or would normally be covered by commercial
insurance covering (A) the Visitor Center and its premises and the City's personal property
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located therein for physical damage or other loss, and (B) business interruption and extra
expenses, irrespective of the decision of the City to carry or not to carry such insurance, or
d. Are caused by or arise out of the services provided by the architects,
engineers and other agents (other than SMG) retained by the City in connection with capital
improvements or capital equipment purchases at the Visitor Center.
Subject to the scope of this indemnification and upon demand of the City made by and
through the City Attorney, in the event that SMG is obligated to indemnify, defend and hold the
City harmless hereunder, SMG shall (i) protect City and appear and defend the City, its elected
officials, officers, employees, volunteers and agents, in any Claims by third parties, whether
judicial, administrative or otherwise, arising out of the exercise of this Agreement by SMG or
claims by other entities disputing the rights and privileges granted by City in this Agreement, and
(ii) agree to confer following any trial to decide jointly whether to appeal, or to oppose any
appeal.
Notwithstanding the foregoing, in the event a claim or liability is due to actual negligence
or intentional misconduct by SMG, or arises from an Event of Default, SMG shall be solely
liable for the cost of defense and any judgment thereon, without contribution by City, and such
expense shall not be an Operating Expense payable by City.
7.5 Survival of Indemnification. The indemnification resulting from services
provided by SMG during the Term shall survive the termination of this Agreement.
ARTICLE 8
RECORDS,ACCOUNTS AND REPORTS
8.1 Books. SMG shall maintain, in accordance with generally accepted accounting-
principles (GAAP), adequate books of account with respect to its management and operation of
the Visitor Center and Palm Springs Tourism and shall maintain such books on the premises of
the Visitor Center.
8.2 Access to Information. City shall have the right to obtain from SMG any
information relevant to SMG's management and operation of the Visitor Center and Palm
Springs Tourism, and to inspect such books and records during normal business hours_ SMG
shall notify all parties with whom SMG enters into contracts in connection with the Visitor
Center that the Visitor Center is owned by the City, a public entity, such that all contracts and
data gathered by SMG and City are subject to disclosure. SMG shall notify all parties with
whom SMG enters into contract in connection with Palm Springs Tourism that, because the City
is a public entity, all contracts and data gathered by SMG and City are subject to disclosure.
SMG shall timely provide City with any information required by City to meet the requirements
of the Public Records Act.
8.3 Annual Audit. As soon as practicable at the close of each Fiscal Year but no
later than ninety (90) days after the close of each Fiscal Year, SMG shall furnish to City a
balance sheet with a statement of profit or loss, and a statement of cash flow prepared in
accordance with GAAP and accompanied by an independent auditor's report containing an
opinion of the independent certified public accountant preparing the report, which shall be a
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reputable firm selected by SMG. SMG shall inform City of its selection of the independent
certified public accountant promptly after its selection. If City notifies SMG that it objects to
SMG's selection, SMG shall select a different independent certified public accountant.
8.4 Quarterly Reports.
a. Financial. Within twenty (20) days after the end of each quarter, SMG
shall furnish to City a report in the general form as approved by the City's Director of Finance
containing all .financial information relevant to SMG's services provided under this Agreement.
The Quarterly Reports shall also compare the applicable Tourism Budget line item to the actual
operating expense to ascertain whether there exists any need to reallocate fimds within individual
line items contained within the Tourism Budget. The quarterly report shall also include all of the
statistical information requested on Exhibit "A." The type of information required to be included
in the Quarterly Reports may be revised by the City's Department of Finance.
b. Marketing. Within twenty (20) days after the end of each quarter, SMG
shall prepare and submit to City, and the PB&J, a report concerning the performance of the
marketing services required by this Agreement and the applicable One-Year Plan, as well as a
listing of staff produced activity and the result of any activity. The report shall also contain all
financial information relevant to the marketing services, including a comparison of the
applicable Tourism Budget line item to the actual marketing expenses to ascertain whetlrer there
exists any need to reallocate funds within line items. The following categories shall be
separately discussed in each quarterly report:
1. A.dvertising. The value of advertising undertaken by the Bureau
of Tourism in producing visitor interest,trips and receipts.
2. Tour Sales. A quantification of the number and estimated impact
of sales leads generated to hotels and other partners, as well as a determination of whether the
sales leads actually converted to confirmed business for the City and the estimated economic
value of such business.
3. Media Publicity. A description of media relations efforts which
are designed to produce new visitor awareness, interest and desire to visit, as well as a projection
of the circulation/readership/viewer ship of such efforts and the financial value of such efforts, as
measured in advertising lineage rates for the same space covered.
4. Special Events. After each Special Event occurs, obtain a third-
party-produced economic impact study that quantifies actual results through room night
generation and attendant community-wide visitor receipts impacts.
The discussion of each category shall include a discussion of: (i) the plans set forth in the
One-Year Plan, specific steps taken and results provided, (ii) an overview of the timeline
established for progress in the One-Year Plan and the deliverables produced to date, and (iii) an
update on the marketing complications, challenges or impediments.
8.5 Ownership of Documents. All drawings, specifications, reports, records,
documents and other materials prepared by SMG, its employees, subcontractors and agents in the
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performance of this Agreement shall be the property of City and shall be delivered to City upon
request of the City Manager or upon the termination of this Agreement, and SMG shall have no
claim for further employment or additional compensation as a result of the exercise by City of its
full rights of ownership of the documents and materials hereunder. Any use of such completed
documents for other projects and/or use of uncompleted documents without specific written
authorization by SMG will be at the City's sole risk and without liability to SMG, and the City
shall indemnify SMG for all damages resulting therefrom. SMG may retain copies of such
documents for its own use. SMG shall have an unrestricted right to use the concepts embodied
therein. All subcontractors shall provide for assignment to City of any documents or materials
prepared by them, and in the event SMG fails to secure such assignment, SMG shall indemnify
City for all damages resulting therefrom.
8.6 Release of Documents. The drawings, specifications, reports, records,
documents and other materials prepared by SMG in the performance of services under this
Agreement shall not be released publicly without the prior written approval of the City Manager,
8.7 Right to Andit. City shall have the right to conduct a financial audit, at its sole
cost and expense, at any time during SMG's normal business hours, of the books and records of
SMG which specifically relate to the Visitor Center and Palm Springs Tourism and no others.
SMG shall account separately for the receipts and expenditures related to each of the following
activities: (i) relating to the management and operation of the Visitor Center, (ii) relating to the
marketing of the Visitor Center, (iii) relating to the marketing and management and operation of
Palm Springs Tourism and (iv) other services performed upon City's reasonable request. SMG
shall make the records relating to the handling and expenditure of funds under this Agreement
available to the City Manager or a person designated by City, excluding SMG's competitors or
potential competitors.
ARTICLE 9
TRANSFER AND ASSIGNMENT
9.1 Ci�iproval of Transfer or Acsianment Required. The City, in entering into
this Agreement, has placed a special value, faith and confidence in the experience, background
and expertise of SMG in operating, marketing and managing the Visitor Center and Palm
Springs Tourism. Such faith and confidence being a substantial consideration in the granting of
this Agreement, the parties therefore agree that no transfer or assignment of SMG's interest
hereunder may occur without the express written approval of City granted as provided hereunder.
The approval of the City may be given or withheld in the City's sole and absolute discretion.
Any transfer without such approval shall be void.
9.2 Transfer. As used hereunder, transfer shall be broadly construed to include any
change in ownership or control, any transfer of stock in SMG's business, the delegation or
assignment of duties, and the entering into subcontracts, with and to persons, finms or entities
who are not existing shareholders or members of the immediate families of existing shareholders
in a cumulative amount greater than thirty percent (30%) of such ownership or control. The
City's consent shall be based upon the prospective owner's financial capability, background,
reputation, experience and expertise in the field of waste disposal, as described below. In
addition, SMG shall not change its Director of Tourism, who is identified in Section 4.1, without
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the prior written consent of the City, which shall not be unreasonably withheld. To assist the
City in determining whether to grant its consent, as required by this Section, SMG shall provide
City with reasonable information concerning the knowledge, experience and background of any
proposed transferee.
9.3 Assignment. Neither SMG nor City shall voluntarily assign or enctunber its
interest in this Agreement, without first obtaining the other party's consent. Any assignment or
encumbrance without the other party's consent shall be voidable and, at the other party's election
within thirty (30) days of actual knowledge of an assigmnent or encumbrance, shall constitute a
default which shall be an Event of Default tmless the assignment or encumbrance is rescinded
within thirty (30) days after the other party has given the assigning party notice of its election to
treat the assignment or encumbrance as an Event of Default; provided, however, that no such
consent is or shall be required in the case of an Approved Assignment, as hereinafter defined.
SMG agrees that at all times during the Tenn of this Agreement, an Affiliate, or any person or
entity that purchases all or substantially all of the assets of SMG or an Affiliate, shall possess the
power to direct or cause the direction of the management and policies of SMG.
a. For purposes hereof, an "Approved Assignment" shall mean:
1. A party's pledge, mortgage, or other assignment of the revenues or
fees which it is entitled to be paid under this Agreement (but not including the assignment of any
other rights under this Agreement) in connection with any credit facilities that may be obtained
by either party or any of their Affiliates, it being the express intent hereunder that SMG shall
have the right to pledge only that portion of the Tourism Budget which is not necessary for the
operation of the Visitor Center or Palm Springs Tourism and no other fees or revenues
hereunder;
2. The assignment of this Agreement by SMG to any Affiliate; or
3. The acquisition by a person or an entity of any equity or other
beneficial interest in, or all or substantially all of the assets of, SMG or any Affiliate.
b. Subject to the requirements for City Council and City Attorney approval
as set forth in Section 3.1, the provisions of this Section shall not prohibit or restrict SMG from
entering into contracts, concessions or licenses for the operation of any portion of the Visitor
Center or Palm Springs Tourism, subject to the terms of this Agreement; provided, however, that
any such agreements shall be assignable to the City upon termination of this Agreement and for
any such agreements which have a non-cancelable term beyond one (1) year from the date of the
termination of this Agreement, the City shall have an option, to be exercised within sixty (60)
days of the termination of this Agreement, to cancel any such agreement upon at least six (6)
months prior notice unless:
1. The agreement received the prior approval of the City pursuant to
this Agreement or otherwise; or
2. The City has a non-disturbance and attornment arrangement (or the
like) with respect to such agreement_
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9.4 Required Information. SMG shall submit its request for City consent to a
transfer or assignment to the City, together with the following documentation and any other
docrnnentation that the City may request:
a. Assignee's audited financial statement for the immediately preceding three
(3) operating years indicating that the proposed assignee's financial status is acceptable to City
and adequate to provide the services hereunder.
b. Satisfactory proof that the proposed assignee has at least ten (10) years of
experience operating, marketing and managing tourism facilities on a scale equal to or exceeding
the scale of operations conducted by SMG.
C. Satisfactory proof that the proposed assignee has at all tithes conducted its
operations at other properties under its control in a prudent fashion, consistent with industry best
business practices and the promotion of tourism activities.
d. Any other information required by City to ensure the proposed assignee
can fulfill the terms hereof in a timely, safe, and effective manner.
9.5 Transfer or Assignment of Fees. Any application for a change of ownership, a
transfer or assignment shall be made in a manner prescribed by the City Manager and SMG shall
make a deposit with City to cover City's reasonable expenses related to the transfer or
assignment payable prior to City's consideration of the transfer or assignment request. The
deposit shall be used to pay City its reasonable expenses for attorneys' fees and investigation
costs necessary to investigate the suitability of any proposed transferee or assignee, and to
review and finalize any documentation required as a condition for approving any such
assignment. City shall document the expenditure of all fiords from the deposit and shall
reimburse all surplus funds to SMG. SMG shall supplement the deposit within ten (10) days of
City's request therefore, in the event additional funds are required. The Transfer shall be
approved by Resolution of the City Council.
9.6 Subcontractors. The use of a subcontractor to perform services under this
Agreement shall not constitute delegation of SMG's duties provided that SMG has received prior
written City approval to subcontract such services and the City Manager has approved the
subcontractor in writing. SMG shall be responsible for directing the work of SMG's
subcontractors and any compensation due or payable to SMG's subcontractors shall be the sole
responsibility of SMG. City shall have the right to require the removal of any approved
subcontractor.
ARTICLE 10
TERMINATION
10.1 Termination. This Agreement may be terminated for the reasons stated
hereunder. Should either party elect to terminate this Agreement, the parties shall nevertheless
comply with all of the provisions of this Article and payment of SMG shall be pursuant to
Section 10.6. Grounds for termination include, but are not limited to:
24
0100310002/29740 07
a. Expiration of Term. This Agreement shall immediately terminate and be
null and void upon expiration of its term if this Agreement has not been extended prior to such
expiration.
b. Expiration for Default. This Agreement shall terminate and be null and
void in the event of and Event of Default, as provided in Article 11.
1. Termination for Default of SMG. If termination is due to the
failure of SMG to fWfill its obligations under this Agreement, City may, after compliance with
the provisions of Article 11, take over the work and prosecute the same to completion by
contract or otherwise, and any expenditures by SMG after SMG receives the notice of
termination shall require the approval of the City Manager.
C. Convenience. The City reserves the right to terminate this Agreement at
any time, with or without cause, upon thirty (30) days' written notice to SMG. Upon receipt of
any notice of termination, SMG shall immediately cease all services hereunder except such as
may be specifically approved by the City Manager. In the event of termination without cause
pursuant to this Subsection, the City need not provide SMG with the opportunity to cure.
10.2 Notice and Might to Cure. In the event of termination pursuant to Section
10.1(b), City shall give SMG written notice of the grounds for termination. 1f, in the reasonable
opinion of the City, the cause for termination can be corrected by SMG, City may provide a
reasonable period as specified in the Notice to SMG to remedy the cause and, in the event that a
cause is not susceptible to cure within such prescribed period, then SMG shall be given a greater
period of time (but in no case more than one hundred twenty (120) days) to cure the breach if, in
the sole discretion of the City, SMG is diligently pursuing such cure_ Notwithstanding the
forgoing, in the event of termination pursuant to Sections 10.1(a), (b) or (c), SMG, at City's
option, shall continue to perform under the provisions of this Agreement for a period of up to six
(6) months to enable City to make arrangements for a successor as operator of the Visitor Center
and Palm Springs Tourism.
10.3 Surrender of Visitor Center. Upon expiration or termination of this Agreement
for any reason, SMG shall promptly surrender the Visitor Center to City, leaving all furniture,
equipment, supplies, books and records, manuals and inventories that are part of the Visitor
Center, or are otherwise the property of City, or that have been purchased with the Tourism
Budget or from funds otherwise made available by City. All funds and accounts maintained by
SMG in the Depository required to be maintained under this Agreement shall be transferred to
City within five (5) business days of the expiration or termination of this Agreement-
Upon the expiration or termination of this Agreement, all improvements made to or upon
the Visitor Center by SMG and all equipment, materials, supplies and inventories purchased by
SMG with the Tourism Budget or with funds otherwise made available by City shall be promptly
surrendered to City and title thereto shall vest in City, to the extent not earlier vested in City,
without any further compensation therefore from City.
SMG shall surrender the Visitor Center in good and first class condition, reasonable wear
and tear excluded. SMG shall commit no waste or destruction of the Visitor Center. Prior to
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delivery of possession to City, the parties shall arrange a joint inspection and SMG shall fully
compensate City for any repairs and clean up required hereunder,
10.4 Continuation of Performance. In the event of termination of this Agreement,
SMG, at City's option, shall continue to perform under the provisions of this Agreement for a
period of up to six (6) months to enable City to make arrangements for a successor as operator of
the Visitor Center and as the marketing entity for Palm Springs Tourism; provided, however, that
SMG shall not be required to perform for a period of time to its detriment.
10.5 Damage or Destruction. In the event of (i) partial or total destruction of the
Visitor Center during the term of this Agreement which requires repairs to the Visitor Center or
(ii) the Visitor Center being declared unsafe or unfit for occupancy by any authorized public
authority for any reason, which declaration requires repairs to the Visitor Center, City shall
forthwith make said repairs provided SMG gives City thirty (30) days' written notice of the
necessity therefore, and further provided that City shall not be responsible for the cost of any
repairs directly caused by SMG or due to poor management practices by SMG. No such partial
destruction (including any destruction necessary in order to make repairs required by any
declaration made by any public authority) shall in any way annul or void this Agreement.
Nothing in the foregoing to the contrary withstanding, if the Visitor Center is damaged or
destroyed at any time during the Tenn hereof to an extent of more than twenty-five percent
(25%) of the then replacement cost (excluding foundations) as a result of a casualty not insured
against, City may within thirty (30) days following the date of such destruction terminate this
Agreement upon written notice to SMG. If City does not elect to terminate because of said
uninsured casualty, City shall promptly rebuild and repair the Visitor Center.
10.6 Waiver of LSabili . In the event that SMG is terminated in accordance with the
terms of this Agreement, SMG expressly waives any clairn against City for any loss, damage,
cost or expense arising therefrom, including future income from the Visitor Center or any portion
of the Tourism Budget, any damages for business interruption or lost profits, and any other
consequential or related damages of any kind whatsoever.
ARTICLE 11
DEFAULT
11.1 Events of Default. Each of the following shall constitute an "Event of Default"
under this Agreement:
a. Failure to pay when due any amount required to be paid under this
Agreement, if the failure continues for five (5) business days after notice has been given to the
defaulting party;
b. Failure to operate the Visitor Center in accordance with best industry
practices;
C. Failure to prepare and obtain City approval of the annual business and
marketing plan in accordance with Section 3.5;
26
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d. Failure to obtain the City Manager's approval of Special Events and filing
the required reports in connection therewith in accordance with Section 3.2(c);
e. Failure to comply with the City's procurement ordinance or failure to get
City Attorney approval of contracts pursuant to Section 3.2(h);
f. Failure to comply with the performance standards set forth in Section 3-3;
g- Appointment of a new Director of Tourism without complying with
Section 4.1 or failure to give notice of termination of the Director of Tourism pursuant to Section
4.3;
h. Making expenditures in excess of the Tourism Budget without City
approval as required in Section 5.1;
i. Failure to invest funds pursuant to Section 5.4;
j. Receipt of a deficient performance review pursuant to Section 6.6 or
failing to meet and confer in a satisfactory manner pursuant to Section 6.7;
k. Failure to maintain proper insurance pursuant to Section 7;
1. Failure to keep adequate books or records or failure to give the City access
to books and records pursuant to Article 8, or failure of SMG to follow an approved plan of
action as agreed upon by the parties after meeting and conrerring;
in. Making a prohibited transfer in violation of Article 9;
n. Failure to perform any other material obligation under this Agreement
(including, without limitation, SMG's failure to meet the responsibilities of SMG set out in
Section 3.2 and the Performance Standards set out in Section 3.3), if such failure to perform is
not cured within the period specified in the notice given to the defaulting party.
11.2 Default Notices. The non-defaulting party shall promptly notify the defaulting
party of any acts or omissions believed by the non-defaulting party to be an Event of Default
under this Agreement. In order to be effective for purposes of Section 11.1, such notice must
state that it is a notice of default, specify in detail the acts or omissions alleged to constitute a
default of this Agreement, and must specify in detail the acts necessary to cure the default.
11.3 Rights of Non-Dgtjaj9Rz_EMjX. if an Event of Default occurs and is not
waived in writing by the non-defaulting party, then the non-defaulting party shall have the
following remedies which are not exclusive but cumulative in addition to any other remedies
now or later allowed by law:
any default; a. The right to reasonably cure, at the defaulting party's cost and expense,
b. The right to sue to collect any sums not paid when due;
27
01003/0002129740.07
c. The right to tenninate this Agreement; and
d. The right to seek specific performance of the defaulted obligation.
11.4 Waivers.
a. City Waiver of Breach. City's waiver of any breach or Event of Default
shall not be deemed to be a waiver of any other breach or Event of Default, including ones with
respect to the same obligations bereunder. City's subsequent acceptance of any damages or other
money paid by SMG shall not be deemed to be a waiver by City of any pre existing or
concurrent breach or Event of Default.
b. SMG Waiver of Defenses. SMG acknowledges that it is solely
responsible for providing the services under this Agreement and hereby irrevocably and
unconditionally waives defenses to the payment and performance of its obligations hereunder
based upon failure of consideration; contract of adhesion; impossibility or impracticability of
performance; commercial hustration of purpose; or the existence, non-existence, occurrence, or
non-occurrence of any foreseen or unforeseen fact, event or contingency that may be a basic
assumption of SMG with regard to any provision hereof.
ARTICLE 12
EQUAL EMPLOYMENT OPPORTUNITY
12.1 Discrimination Prohibited. SMG shall not discriminate against any employee or
applicant for employment because of age, race, creed, sex, color or national origin or any other
basis prohibited by legal requirements, and SMG shall take affirmative action to ensure that any
employee or applicant for employment is afliorded equal employment opportunities without
discrimination because of age, race, creed, sex, color or national origin. Such action shall be
taken with reference, but not be limited to, recruitment, employment,job assignment, promotion,
upgrading, demotion, transfer, layoff or termination, rates of pay or other forms of compensation
in selection for training or retraining, including apprenticeship and on the job training.
12.2 Affirmative ,Action. SMG shall comply with applicable affirmative action
policies of City and shall participate in City's affirmative action programs.
ARTICLE 13
CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION
13.1 Non-liability of City Officers and Employees. No officer or employee of the
City shall be personally liable to SMG, or any successor in interest, in the event of any default or
breach by the City or for any amount which may become due to SMG or to its successor, or for
breach of any obligation of the terms of this Agreement.
13.2 Conflict of Interest. No officer or employee of the City shall have any financial
interest, direct or indirect, in this Agreement nor shall any such officer or employee participate in
any decision relating to the ,Agreement which effects his financial interest or the financial interest
of any corporation, partnership or association in which he is, directly or indirectly, interested in
28
0 1 0 03/0 0 02129 74 0.07
violation of any State statute or regulation. SMG warrants that it has not paid or given and will
not pay or give any third party any money or other consideration for obtaining this Agreement.
ARTICLE 14
MISCELLANEOUS
14.1 California Law. This Agreement shall be construed and interpreted both as to
validity and to performance of the parties in accordance with the laws of the State of California.
Legal actions concerning any dispute, claim or matter arising out of or in relation to this
Agreement shall be instituted in the Superior Court of the County of Riverside, State of
California, or any other appropriate court in such county, and SMG covenants and agrees to
submit to the personal jurisdiction of such court in the event of such action.
14.2 Rights and Remedies are Cumulative. Except with respect to rights and
remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the
parties are cumulative and the exercise by either party of one or more of such rights or remedies
shall not preclude the exercise by it, at the same or different times, of any other rights or
remedies for the same default or any other default by the other party.
14.3 Notice. Unless expressly otherwise provided elsewhere in this Agreement, any
election, notice or other communication required or permitted to be given under this Agreement
shall be in writing and deemed to have been duly given if and when delivered personally (with
receipt acknowledged), the fourth (4th) day after mailing (by certified snail return receipt
requested) with proper postage prepaid, by facsimile transmission with evidence confirming
transmission, or when delivered by a national commercial courier service (such as Federal
Express) for expedited delivery, to be confirmed in writing by such courier.
To City: City Manager
City of Palm Springs
3200 East Tahquitz Canyon Way
Palm Springs, CA 92262
Fax: (760) 32.1-7701
With a copy to: David J. Aleshire, Esq.
Aleshire & Wynder LLP
18881 Von barman Avenue, Ste. 400
Irvine, CA 92612
Fax: (949) 223-1180
To SMG: SMG
701 Market Street, 4th Floor
Philadelphia, PA 19106
Attention: President
Fax: (215) 592-6699
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0100310002/29740.07
With a copy to: Stradley, Ronon, Stevens & 'Young
2600 One Commerce Square
Philadelphia, PA 19103
Attention: William R. Sasso, Esq. or
Steven A. Scolari, Esq.
Pax: (215) 564-8120
14.4 Attorneys' Fees. If either party to this Agreement is required to initiate or defend
or made a party to any action or proceeding in any way connected with this Agreement, the
prevailing party in such action or proceeding, in addition to any other relief which may be
granted, whether legal or equitable, shall be entitled to reasonable attorney's fees. Attorney's fees
shall include attomey's fees on any appeal. In addition, a party entitled to attorney's fees shall be
entitled to all other reasonable costs for investigating such action, taking depositions and
discovery and all other necessary costs the court allows which are incurred in such litigation. All
such fees shall be deemed to have accrued on commencement of such action and shall be
enforceable whether or not such action is prosecuted to judgment_
14.5 Amendment. This Agreement may be amended at any time by the mutual consent of the parties by an instrument in writing.
14.6 Successors. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective heirs, executors, successors, and, permitted assigns but this provision
shall not be deemed to permit any assignment by a party of any of its rights or obligations under
this Agreement except as expressly provided herein.
14.7 Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of California (without giving effect to the
State's principles of conflicts of laws). Venue for suit shall be the County of Riverside and the
Central District of the United States District Court. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of California (without giving
effect to the State's principles of conflicts of laws). Venue for suit shall be the County of
Riverside and the Central District of the United States District Court.
14.8 Reasonableness. Whenever by the terms of this Agreement, a party has the right
or power to grant or withhold its consent or approval, such parry agrees not to withhold or delay
such consent or approval unreasonably, unless this Agreement specifically provides one party
with sole discretion on an issue.
14.9 Entire A reement. This Agreement, including the attached exhibits, contains the
entire agreement of the parties and supersedes all prior and contemporaneous agreements and
understandings, oral or otherwise, among the parties with respect to the matters contained in this
Agreement and may not be modified or amended except as set forth in this Agreement.
14.10 Counterparts. This Agreement may be executed in one or more counterparts and
each of such counterparts, for all purposes, shall be deemed to be an original, but all of such
counterparts together shall constitute but one and the same instrurnent, binding upon the parties,
notwithstanding that all of the parties may not have executed the same counterpart.
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14.11 Limitation of Liability. City agrees that no partner, co-venturer, employer,
agent, director, officer, shareholder or employee of SMG shall be personally liable to City or
anyone claiming by, through or under City, by reason of any default by SMG under this
Agreement or for any amount that may become due to City by SMG under the terms of this
Agreement or otherwise. SMG agrees that no officers, agents, or employees of City shall be
personally liable to SMG or anyone claiming by, through, or under SMG by reason of any
default by City under this Agreement, or for any amount that may become due to SMG by City
under the terns of this Agreement or otherwise.
14.12 Responsibilities of Parties. Both parties agree to use reasonable care and
diligence to perform their respective obligations under this Agreement. Both parties agree to act
in good faith to execute all instruments, prepare all documents and take all actions as may be
reasonably necessary to carry out the purposes of this Agreement. Unless hereafter specified,
neither party shall be responsible for the service of the other.
14.13 Authority to Execute. The persons executing this Agreement on behalf of the
parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly
authorized to execute and deliver this Agreement on behalf of said party, (iii) by so executing
this Agreement, such party is formally bound to the provisions of this Agreement, and (iv) the
entering into this Agreement does not violate any provision of any other Agreement to which
said party is bound.
[SIGNATURE PAGE FOLLOWS]
31
0100310002/29740.07
IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as
of the date first written above.
CITY:
CITY OF PALM SPRINGS, a muuiicipal
corporation
By:
City Manager
ATTEST:
City Cleric
APPROVED AS TO FORM:
City Attorney
SMG:
SMG, a Pennsylvania general partnership
By:
Name:
Title:
By:
Name:
Title:
Address:
[END OF SIGNATURES]
01003/0002129740 07 32
EXHIBIT "A"
RECOMMENDATIONS FOR MONTHLY PERFORMANCE REPORT
Total tour sales programs booked
Total estimated economic impact
Leisure visits produced (from Conversion of ad inquiries to call center and
website)
Total estimated economic impact
Media publicity generated
Audience impressions
Impression dollar value
Special Event impacts (by individual event)
Estimated room nights
Estimated economic impact
Number of marketing partnerships
$ In-kind services
Client Contacts/Calls Made
Meeting Planners—Contacts/Calls
Tour Operators—Contacts/Calls
Travel Writers—Contacts/Calls
Media Inquiries Serviced
Leads Generated
Tour Operator Leads Generated
Estimated Room Nights
Total Leads Generated
Estimated Room Nights
Family'fours
Tour Operator Events
Tour Operator Clients
Travel Writer/Media events
Travel Writer/Media participants
Site Inspections
Meeting Planners
Tour Operators
Travel Wnters/Media
A-1
0 1 0 0310 0 0 2/29 74 0.07
Communications
Travel Media Audience Impressions Generated (in circulation)
$ Value Ad Equivalency
Travel Releases Issued
Inquires generated
Advertising audience impressions
Call center inquiries (phone, labels,mail)
Website user sessions
Total inquires (website, calls)
Total visits as a result of conversion
Resulting economic impact
Website registered users
Visitor Services
Visitor center patrons
Visitor center reservations trade (and economic impacts)
A-2
01003/0002129740.07
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND CONTRACT INTERPRETATION ..................................I
1.1 Definitions •. .............................................................. ...........1
12 Interpretation................................................................. . . . ................2
1.3 Integration ....................................................................... •.....3
1.4 Consistency with Law and Severability....................................................3
L5 Construction of Terms ...................................... . ................................3
1.6 Licenses, Permits, Fees and Assessments.................................................4
ARTICLE 2 GRANT OF AUTHORITY AND TERM OF AGREEMENT.............................4
2.1 Gram of Authority.........................................• . . ....................................4
2.2 Acceptance and Effective Date.................................................................4
2.3 Tenn.................................... .................................................. 4
2.4 City's Authorized Representative; Approval ............................................5
2.5 Authority of SMG.................................. • . . ..........................................5
2.6 Employees......................................... • ....................................... 5
2.7 Visitor Center Use and Purchase of Supplies and Services......................5
2.8 Representations and Warranties................................................................5
2.9 Time of Essence................................... . •.................................... .......6
2.10 ForceMajeure................................. .......................................................6
ARTICLE 3 RESPONSIBILITIES OF SMG............................................................................6
3.1 Mission Statement for Palm Springs Tourism..........................................6
3.2 Responsibilities of SMG.................................................................... . ...6
3.3 Performance Standards ...... 8
3-4 Duty and Liability...............................
3.5 One-Year Plan....................................... ........................ .....................9
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TABLE OF CONTENTS cont.
Page
3.6 Operation of Visitor Center .............................. 11
3.7 Staff................................................................ . 11
3.8 Planning, Budgeting Joint Advisory Cotrunittee. ...................................I I
3.9 Monitoring of Performance and Changes to One-Year plan................_12
ARTICLE 4 COORDINATION OF WORD ................................. .........12
4.1 Director of Tourism.............. ................................_..........
4.2 Expertise of SMG,s Representatives....................................
4.3 Termination of the Director of Tourism ........................... . 13
ARTICLE 5 SMG COMPENSATION.............................. . 13
5.1 Tourism Budget .......................... ................ 13
5.2 Reduction/Elimination of Revenue Source.................... .-.........14
5.3 Payment Method.. ......................... ......................... ......14
5.4 Security for and Investment of Funds........................... . ............14
5.5 No Obligation of Manager to Advance Funds........................................15
ARTICLE 6 PERFORMANCE REVIEW..................................... ..15
6.1 Time for Performance Review.................................. .15
6.2 Components of Performance Review_........................... ........15
6.3 Visitor Center Inspection.................................... 15
6.4 Financial Performance Review............... ........15
6.5 Service Review............. ........... .......... ....16
6-6 Preparation of Annual Perl'ornance Review..........................................17
6-7 Meet and Confer Process.............. 17
6.8 New or Expanded Services................................. . .........17
6.9 Service Materials Belong to City............................................................17
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TABLE OF CONTENTS coat.
Pale
ARTICLE 7 INSURANCE AND INDEMNIFICATION.......................................................18
7.1 Insurance to be Maintained by SMG......................................................18
7.2 Insurance to be Maintained by the City..................................................19
7.3 Insurance Policies . ........................................................................ .....19
7.4 Indemnification of City. .......................... ..........19
7.5 Survival of Indelmnmification....................................................................20
ARTICLE 8 RECORDS, ACCOUNTS AND REPORTS ......................................................20
8.1 Books.................................. ............ ............. ............. .............20
8.2 Access to Information.......................................... ---70
8.3 Annual Audit........................................... .20
8.4 Quarterly Reports.................................... ..21
8.5 Ownership of Documents .......................................................................21
8.6 Release of Documents....................................... . ...22
8.7 Right to Audit .. . ............ ................ .............................. . ...22
ARTICLE 9 TRANSFER AND ASSIGNMENT................................. . ..22
9.1 City Approval of Transfer or Assignment Required...............................22
9.2 Transfer............... ........... ............. ..........22
9.3 Assignment........................................ .......23
9.4 Required Infor>nation........................................................... 24
9.5 Transfer or Assignment of Fees—........................... ...............................24
9.6 Subcontractors........................................ ......24
ARTICLE 10 TERMINATION.............................. ........24
10.1 Termination...................................... ....................................................24
10.2 Notice and Right to Cure. .......... ............ .......................................25
0100310002/29740,07
TABLE OF CONTENTS Lcont.1
Pie
10-3 Surrender of Visitor Center.....................................................................25
10-4 Continuation of Performance..................................................................26
10.5 Damage or Destruction........... ..................... .................... ........26
10.6 Waiver of Liability........................ .............................................. .....26
ARTICLE 11 DEFAULT.................................................... . ...................... ......................... ..26
11.1 Events of Default.... ............................................................................26
11.2 Default Notices .......................................................___.......................27
11.3 Rights of Non-Defaulting Party..............................................................27
11.4 Waivers.............................. . ................... •. ..................... . ...............28
ARTICLE 12 EQUAL EMPLOYMENT OPPORTUNITY .....................................................28
12.1 Discrimination Prohibited.......................................................................28
12.2 Affirmative Action. .............. .. ................. ................... ................28
ARTICLE 13 CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION...............28
13.1 Non-liability of City Officers and Employees........................................28
13.2 Conflict of Interest....... .................... . ....................................... .......28
ARTICLE 14 MISCELLANEOUS...........................................................................................29
14.1 California Law...... ................... . ........................................ .. .............29
14.2 Rights and Remedies are Cumulative.....................................................29
14.3 Notice... .. .............. . ............... .................. ................. ...............29
14.4 Attorneys' Fees............... ................ ............... ............... I.,....30
14.5 Amendment......... ................ 30
14.6 Successors.................................... ................................................. ....30
14.7 Governing Law.......................... ................................................. .......-0
14.8 Reasonableness...................... ................................ ............................30
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TABLE OF CONTENTS (cont.)
Pale
14-9 Entire Agreement....................................................................................30
14.10 Counterparts.............. .............................................................................30
14,11 Limitation of Liability--------------------------------------------- ---------------------------3 1
14.12 Responsibilities of Parties.............................. ......... .............. ....11
14.13 Authority to Execute...............................................................................3)1
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