HomeMy WebLinkAboutEC15-003 - Amendment - #1 - SMG - Sale Marketing and Operational Management Services - 01/01/2020 Agreement Routing Form
• For Approvals,Signatures and Records Management
This form combines&replaces the Request for Mayor's Signature and Contract Cover Sheet forms.
K N 1
w A e H I N c T o� (Print on pink or cherry colored paper)
Originator: Department:
l F ECD
Date Sent: Date Required:
> 5/12/2020
O
L
O. Authorized to Sign: Date of Council Approval:
QEl Director or Designee 0 Mayor February 4, 2020
Budget Account Number: Grant? []Yes 0 No
Budget? ❑Yes ❑No Type: N/A
Vendor Name: Category:
SMG Contract
Vendor Number: Sub-Category:
O 202216 Amendment
O
Project Name: SMG - Sales, Marketing and Operational Management Services Agreement
E - Amendment 1
Project Details:The contract amendment extends the term of the contract through December 31,2024, provides for a fixed
annual fee of$145,624 for 2020 and an incentive fee subject to an annual cap of$100,000 and other
�.. amendments including contributions for the purchase of a new scoreboard.
C
W
E Agreement Amount: Basis for Selection of Contractor: Other
W
I- start Date: January 1, 2020 Termination Date: December 31 , 2024
IM
Q
Local Business? 0 Yes []No*
*If meets requirements per KCC 3.70.700,please complete"Vendor Purchase-Local Exceptions"form on Cityspace.
Notice required prior to disclosure? Contract Number:
❑Yes 0 No �C, _ 00
Date R clU J`rAN ey 1 E Co ents
C1
a:+
3 O MAY 2
a,
oc
�El,
NT I AW DEP'T
M
tm Date Routed to the Mayor's Office:
v1
Date Routed to the City Clerk's Office:
aaaw22373_1_20 Visit Documents.KentWA.gov to obtain copies of all agreements
FIRST AMENDMENT TO SHOWARE CENTER SALES,
MARKETING, AND OPERATIONAL MANAGEMENT SERVICES AGREEMENT
This First Amendment to the Showare Center Sales, Marketing, and Operational
Management Services Agreement ("First Amendment") is entered into between the City of Kent,
a Washington municipal corporation ("City"), and SMG, a Pennsylvania general partnership and
a division of ASM Global, located and doing business at 300 Conshohocken State Rd., Suite 770,
West Conshohocken, PA 19428 ("Contractor").
WHEREAS, the Parties entered into the Showare Center Sales, Marketing, and
Operational Management Services Agreement for a term commencing January 1, 2015 (the
"Management Agreement"), under which the City retained Contractor to manage the facility now
known as the accesso ShoWare Center;
WHEREAS, the Parties desire to amend the Management Agreement in accordance with
the terms and conditions set forth in this First Amendment;
NOW THEREFORE, in consideration of the foregoing recitals, and for other good and
valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties
covenant and agree as follows:
1. Article III, PERIOD OF PERFORMANCE, Section A. Management Term shall be deleted
in its entirety and replaced with the following Article III, PERIOD OF PERFORMANCE,
Section A. Management Term:
The "Management Term" of this Agreement shall commence on
January 1, 2020, and end at midnight on December 31, 2024, unless
earlier terminated pursuant to the provisions of this Agreement.
Any action taken in conformance with this Agreement that occurs
on or after January 1, 2020, but prior to execution by both parties
shall be deemed ratified by such execution. The City may, in its sole
discretion,extend the Management Term for up to two(2)additional
periods of five (5)years by so notifying the Contractor in writing no
less than 90 days prior to the expiration of this Agreement. The
foregoing notwithstanding, this Agreement shall be terminable at
the end of the third year of the Management Term, or the third year
of any subsequent five-year extension thereof, by giving Contractor
no less than 180 days prior written notice of such termination.
2. The Parties agree that the Fixed Annual Base Fee payable under Article IV, Section A. for
the 2020 Fiscal Year shall be $145,624,which amount shall be adjusted upward on the first
day of each subsequent Fiscal Year and payable as specified in Article IV, Section A.
3. Article IV, Section B Annual Incentive Fee shall be deleted in its entirety and replaced
with the following:
In addition to the Fixed Annual Base Fee described above, the
Contractor shall be eligible, in each operating year of the period of
performance under this Agreement, for an Annual Incentive Fee.
The Annual Incentive Fee shall be an amount equal to 20% of all
Operating Revenues in excess of a benchmark of$2.15 million.
The Annual Incentive Fee shall not initially be subject to any cap.
However, the Annual Incentive Fee shall be capped at$100,000 for
each Fiscal Year, or portion of Fiscal year, subsequent to the Fiscal
Year in which the aggregate amount of Annual Incentive Fee
payments to SMG equals $920,000 ($920,000 being the"Recapture
Amount"described in Section I.4.).
The Annual Incentive Fee determined pursuant to this Article IV,
Section B shall be payable to Contractor within thirty(30)days after
the City's receipt of an invoice from Contractor setting forth the
Operating Revenues and Operating Expenses for the previous Fiscal
Year, together with any additional supporting documentation, if
approved by the City, and showing the calculation of the incentive
fee payable with respect to such Fiscal Year.
4. Article V, Section I.2. shall be deleted in its entirety and replaced with the following:
The Parties agree that as of the date of the First Amendment, the
unpaid amount of the SMG Capital Contribution described in
Section I.I. is $420,000 (the "2015 SMG Capital Contribution
Balance").
5. The following shall be added as a new Article V, Section I.3.:
Within thirty (30) days after the effective date of the First
Amendment, SMG shall provide to the Events center the sum of
Five Hundred Thousand Dollars ($500,000) (the "2020 SMG
Capital Contribution") to be used for the City's purchase of a new
scoreboard for the Events Center.
6. The following shall be added as a new Article V, Section I.4.:
Commencing on January 1, 2020, the amount of the 2015 SMG
Capital Contribution Balance as reflected in Article V, Section 1.2
of this First Amendment and the 2020 SMG Capital Contribution as
reflected in Article V, Section 1.3 of this First Amendment (which
amount totals $920,000), shall be recaptured by SMG by the City's
payment of the incentive fee described in Article IV, Section B over
a period of up to fifteen (15) years, amortized-on a non-interest-
bearing cash basis. In the event of the expiration or termination of
this Agreement for any reason prior to the full recapture by SMG of
2
i
the SMG Capital Contribution, the City in its discretion may
immediately pay, or cause any successor management company to i
pay, to SMG unconditionally and without set-off an amount equal
to the then-existing (i) unpaid amount of the 2015 SMG Capital
Contribution Balance,plus(ii)the unpaid amount of the 2020 SMG
Capital Contribution, less (iii) any previously paid Recapture
Amount under Article IV, Section B. In the event the City does not
immediately pay such unpaid amount, then it shall repay such
amount by making equal annual payments to SMG based on the
original amortization schedule,until such time as the amount is fully
repaid.
7. The following shall be added as Article XIV, Section CC:
Expenditures (which may include a reasonable allocation of costs
associated with ASM Global and its affiliate companies providing
information technology services) for information technology
systems and services that Contractor reasonably deems necessary to
achieve compliance with applicable best practices, standards,codes,
regulations and laws,and which will be utilized for the operation of
the Events Center, shall be Operating Expenses and included within
and funded as part of the Operating Budget, and to the extent that
such funding is unavailable to contractor, the procedure set forth in
Article VII(C) shall apply.
S. Except as expressly amended in this First Amendment, all of the other terms, conditions
and obligations of the Parties under the Management Agreement are ratified and shall
remain in full force and effect.
9. This First Amendment may be executed in any number of counterparts,each of which shall
constitute an original and all of which together shall constitute but one and the same
original document.
i
f
IN WITNESS WHEREOF,the Parties have executed this First Amendment to be effective
January 1, 2020.
I
CITY OF KENT SM
Dana Ralph Name: Kv&'Pf"" 7eZZ,.e,3
Mayor Title:
A o orm:
Attorn
3