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EXHIBIT 10.28
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GOLF FACILITIES MANAGEMENT AGREEMENT
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This Golf Facilities Management Agreement (the "Agreement"), made as of
January 1, 1998 by and between SENIOR TOUR PLAYERS DEVELOPMENT, INC., a Nevada
corporation (the "Manager") and the TOWN OF NORTH HEMPSTEAD, a municipal
corporation of the State of New York (the "Town").
W I T N E S S E T H:
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WHEREAS, the Town is constructing a new municipal golf facility in the Town
of North Hempstead, New York which will include an 18-hole golf course, to be
known as Harbor Links, a 9-hole executive golf course, driving range, clubhouse,
maintenance building, practice/learning center, parking lot and related golf
facilities, five athletic fields, the surrounding cliff areas and, at the
discretion of the Town, a miniature golf course, collectively hereinafter
referred to as the "Facility"; and
WHEREAS, the Manager is engaged in the business of marketing, maintaining
and managing golf courses, golf clubs and golf facilities; and
WHEREAS, in accordance with the terms and conditions set forth in this
Agreement, the Town desires to retain the Manager and the Manager desires to
assume management responsibility and provide its professional services for all
golf facilities at the Facility;
NOW, THEREFORE, in consideration of the covenants and agreements of each of
the parties hereinafter set forth, it is mutually agreed as follows:
1. DESCRIPTION OF FACILITY. For purposes of this Agreement, the term
"Facility" shall be deemed to refer to and shall consist of the real estate,
buildings, improvements and personal property at the Town's Harbor Links
facility as described in Exhibit A hereto.
2. APPOINTMENT OF MANAGER. The Town hereby appoints the Manager and the
Manager hereby accepts the appointment as manager of the Facility, subject to
the provisions hereof.
3. EFFECTIVE DATE. The Effective Date of this Agreement shall be January
27, 1998.
4. TERM.
(a) The term of the Agreement shall commence on the Effective Date and
shall terminate on December 31, 2007, unless extended or sooner terminated
as provided hereinafter.
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(b) The Town shall have the right to renew this Agreement on
substantially identical terms and conditions, with fee increases similar to
those provided for in the initial Agreement, for an additional period of
five (5) years upon giving written notice thereof to the Manager not less
than 120 days prior to the termination of this Agreement.
5. GENERAL OPERATIONAL RESPONSIBILITIES OF MANAGER. Commencing with the
Effective Date and continuing until the termination of this Agreement, the
Manager shall have full authority and responsibility, subject to the direction
of the Town, the written policies of the Town and budgets approved by the Town,
to conduct, supervise, and manage day-to-day maintenance and operation of the
Facility; PROVIDED, HOWEVER, that all of the Manager's direct costs with respect
to discharging its responsibilities under this Agreement shall be reimbursed by
the Town as provided herein. The general operational responsibilities of the
Manager hereunder shall include, but not be limited to, the following:
(a) During the period prior to opening of the 18-hole course the
Manager shall advise the Town on operational factors to be considered in
the planning and design of those Club facilities not yet under construction
or completed as of the Effective Date. The Manager shall work with the Town
and other members of the Town's development team (E.G., architects and
engineers) to ensure that operational factors are addressed in a timely and
proper manner during the development process, so that the Town's funds
available for construction of the golf course facilities are properly
directed and allocated.
(b) The Manager shall be responsible for preparing for the Town's
approval a marketing plan for the Facility during the pre-opening phase.
The Manager also shall be responsible for implementing this plan in
cooperation with the Town, consistent with budgets and schedules approved
by the Town.
(c) The Manager shall be responsible for cooperating with First Golf,
as the interim manager of the Facility, in implementing the establishment
and maintenance of the golf courses during the pre-opening phase,
consistent with plans, budgets and standards reasonably approved by the
Town.
(d) The Manager shall prepare for Town approval, annual budgets and
annual business plans, in accordance with Section 6 below, covering the
first year (full or partial) of operation and each subsequent year during
the term of this Agreement.
(e) As a component of the Annual Plan (as defined below), the Manager
shall create and implement annual marketing plans for each golf course
(I.E., the 9-hole and the 18-hole), including public relations,
advertising, promotional and membership sales components, supported by
detailed budgets and recommendations for materials, media and promotional
events.
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(f) The Manager shall establish quality standards at the Facility,
which shall be reasonably acceptable to the Town, and provide for the
training of employees to meet these standards.
(g) The Manager shall supervise, in a commercially reasonable manner,
the maintenance of the Facility grounds (including, without limitation, the
surrounding cliffs), associated landscaping, clubhouse and all other
facilities, consistent with the "Minimum Facility Maintenance Standards"
attached to this Agreement as EXHIBIT B.
(h) The Manager shall prepare and provide to the Town for its approval
no later than 60 days after the Effective Date a statement of policies and
procedures with respect to the Manager's responsibilities hereunder.
(i) The Manager shall supervise, in a commercially reasonable manner,
the management of the food and beverage service, including the creation of
menus and the establishment of food and beverage prices, and use its best
efforts to obtain in the name of the Town a liquor license and all other
licenses and permits necessary.
(j) The Manager shall supervise management of, play on, and general
operation of, the Facility in accordance with an Operation and Management
Plan submitted to the Town for its reasonable approval within 30 days of
the Effective Date; PROVIDED, HOWEVER, that the Town shall have the right
to review the Manager's assignment of golf tee times to determine the
fairness and availability of such assignments; and PROVIDED FURTHER that
the Town shall supervise play on, and general operation of, the five
athletic fields with respect to which the Manager's responsibilities shall
be limited to maintenance and repair.
(k) The Manager shall manage the Facility in a commercially reasonable
manner which would make the Facility comparable with other similar first
class golf facilities in the vicinity of where the Facility is located.
(l) The Manager shall work with the Town Board, Town Supervisor,
staff, the advisory committee referred to in Section 47 hereof, and
community organizations to generate the best possible publicity for the
Facility, and generate positive impacts on the Town as a result of the
development and operation of the Facility.
(m) The Manager shall ensure that the pro shop at the Facility carries
sufficient products and inventory to satisfy generally the needs of players
utilizing the Facility.
(n) The Manager shall conduct physical inventories on a regular basis
as reasonably required by the Town.
(o) The Manager shall establish and administer, for all maintenance
equipment, a preventative maintenance program which is designed to keep all
equipment
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in clean, safe and good operating condition for its useful life. Such
maintenance shall be performed no less frequently than recommended by the
manufacturer of the equipment. Equipment records shall be retained on site
and shall be subject to inspection by the Town during normal business
hours.
(p) The Manager shall develop, revise, and implement food and beverage
concepts, policies and procedures; PROVIDED, HOWEVER, such concepts,
policies and procedures shall not materially deviate from those established
under the then current annual Budget unless such deviation is approved by
the Town.
(q) If requested by the Town the Manager shall negotiate and arrange
for all leases, licenses and concessions for the pro shop and any other
commercial space.
(r) Subject to Section 31 hereof, the Manager shall apply for, and
attempt to obtain and maintain in the name of the Town or the Manager, as
required by the Town or applicable law, all licenses and permits required
of the Town or the Manager in connection with the management and operation
of the Facility at no cost to the Manager.
(s) The Manager shall institute and defend, utilizing legal counsel
selected by the Town, any and all legal actions or proceedings reasonably
necessary or proper in connection with the routine operation of the
Facility, including actions or proceedings to collect accounts receivable
or to cancel or terminate any lease, license or concession agreement for
the breach thereof or default thereunder by any tenant, licensee or
concessionaire, and take appropriate steps to protect and/or litigate to
final decision in any appropriate court or other forum, any violation,
order, rule or regulation directly related to the operation of the
Facility.
(t) The Manager shall negotiate and submit to the Town for its
consideration and approval arrangements for the acceptance of payments by
credit card by patrons of the Facility.
(u) The Manager shall cooperate with the Town in integrating the
Manager's financial software into the Town's financial software programs.
(v) The Manager shall provide to the Town an initial capital
contribution of $1,000,000 on July 1, 1998 (or such later date as the Town
shall, in its sole discretion, decide and so notify the Manager).
(w) The Manager shall assist the Town in obtaining equipment and
supplies for the Facility at prices as favorable as those for similar
equipment and supplies obtained by the Manager at its other golf
facilities.
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6. ANNUAL BUDGET AND BUSINESS PLAN.
(a) On or before the Effective Date and by August 1 of each year
commencing August 1, 1998, the Manager shall submit to the Town, for the
Town's approval, a proposed annual business plan (the "Annual Plan") and
operating budget (the "Budget") prepared on a format approved by the Town.
For calendar year 1998 the Budget shall be based upon, and consistent with,
the financial projections submitted by the Manager to the Town dated
December 6, 1997 and December 9, 1997. If requested by the Town, the
Manager shall provide the Town with the data and information utilized in
preparing the Annual Plan and Budget or any revisions thereto. In the event
the 9-hole golf course at the Facility opens prior to the 18-hole golf
course, the Manager shall submit to the Town for its approval, not later
than 30 days prior to the opening of the 9-hole golf course, a revised
Budget indicating that operation of the 9-hole golf course will not
generate additional expenses in excess of revenues attributable to such
operation.
(b) The Annual Plan shall describe the Manager's major management
goals and intended actions for the ensuing year in reasonable detail so as
to enable the Town to evaluate the Manager's intended conduct of the
affairs of the Facility during that period.
(c) In general, the Budget shall include such details regarding
revenues and operating and capital expenditures for the upcoming Budget
period as the Town shall reasonably request. Without limiting the
foregoing, the Budget shall set forth the Manager's reasonable estimates
of:
(i) gross revenues consisting of all membership dues, green fees,
cart rental fees, proceeds of sales of inventory, supplies, beverages
or food, facility use revenues (excluding fees charged for use of
athletic fields), driving range receipts, miniature golf receipts, and
any other income of any kind derived from any source at the Facility
over which the Manager has any responsibility, without reduction for
costs of goods sold or other expenses ("Gross Revenues");
(ii) all costs and expenses directly related to the operation of
the Facility including (without limitation) employee and independent
contractor costs, repair and maintenance expenses, costs of inventory
and supplies, utility costs, administrative and general costs,
marketing costs, insurance and management fees hereunder;
(iii) a budget of the Manager's recommended renewals, revisions,
rebuilding, replacements, substitutions or improvements to the
Facility for the Budget period which are of a capital nature,
including estimates for the cost of designs, plans and specifications,
materials, labor (including installation), storage, consultants,
travel, overhead and freight, and estimates of any additional gross
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revenues or expense savings which can reasonably be expected to result
therefrom; and
(iv) any other matter deemed appropriate by the Manager or
reasonably requested by the Town.
(d) The Budget shall not provide for reserves for the payment of
contingencies unless such reserves are determined to be necessary by the
Town in its sole discretion.
(e) No portion of the Manager's general or administrative costs,
overhead or similar costs which may be indirectly related to the operation
of the Facility and which are attributable to activities performed outside
the premises of the Facility shall be included in the Budget or otherwise
reimbursable by the Town unless expressly otherwise agreed to by the Town
in its sole discretion.
7. APPROVAL OF BUSINESS PLAN AND BUDGET.
(a) The Town shall approve, at its sole discretion, the Annual Plan
and all major policy decisions with respect to the Facility subsequent to
consideration thereof by the advisory committee referred to in Section 47
hereof.
(b) The Town shall approve, at its sole discretion, the Budget in
accordance with the Town's regular budget calendar for the upcoming Budget
period. Without limiting the foregoing, all fees or prices proposed by the
Manager to be charged to customers or other users of the Facility shall be
subject to the approval of the Town which approval may be subsequently
revoked at any time upon 14 days notice to the Manager.
8. IMPLEMENTATION OF BUDGET. The Manager shall use its best efforts to
operate the Facility in accordance with the then current Budget and to achieve
the results projected in such Budget. If at any time during any Budget period
the Manager reasonably believes that the Gross Revenues or operating expenses
may vary adversely by more than five percent (5%) from the originally budgeted
amount, then such variance shall be immediately reported to the Town together
with a description in reasonable detail explaining the reasons for such variance
and corrective measures recommended by the Manager.
9. NATURE OF MANAGER'S BUDGET. The Town acknowledges that the projections
contained in each proposed Budget are subject to and may be affected by changes
in financial, economic and other conditions and circumstances beyond the
Manager's reasonable control. The Town further acknowledges that each proposed
Budget is solely a planning tool used in pursuit of the objective of maximizing
the financial performance of the Facility. Subject to the indemnity provisions
of Section 29 hereof, the Manager in no event shall be liable based upon a
variance between actual results and expenditures and the estimate of the
projected results and expenditures for the period covered by any such Budget due
solely to such changes, conditions
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or circumstances and not attributable to any gross negligence, willful
misconduct or knowing violation of law on the part of the Manager.
10. GROSS REVENUES.
(a) The Town may establish in the name of the Town such bank or other
deposit and checking accounts as the Town in its sole discretion determines
are necessary for the efficient operation of the Facility and control of
the flow of funds received and disbursed in connection with such operation,
or, at the Town's sole discretion, may use existing Town accounts for such
purpose (in any case, generally referred to herein as the "Facility
Account").
(b) The Manager shall deposit in the Facility Account all Gross
Revenues from the operation of the Facility within a 24-hour period and
shall be responsible for the safekeeping, storage and transportation of
such receipts until they are delivered to a bonded courier, if any, or
deposited to such account.
(c) In no event shall amounts deposited in any accounts established
under this Agreement be co-mingled with any other funds of the Manager.
(d) Any amounts on deposit at any time in the Facility Account may be
withdrawn by the Town and deposited in any general municipal fund or other
Town account and applied to any purpose, whether related to the Facility or
not, as the Town so determines in its sole discretion.
(e) The Manager shall establish and maintain an internal control
structure reasonably acceptable to the Town regarding cash receipts,
charges, disbursements and Town assets to provide reasonable assurance that
Town assets are safeguarded against loss from unauthorized use or
disposition. In addition, the Manager shall agree to implement any
reasonable internal control recommendation that may develop from future
audits if determined by the Town to be in the Town's best interest.
11. EXPENSES.
(a) The Facility operating expenses and capital expenditures, in each
case as approved by the Town or expressly authorized to be incurred by the
Manager hereunder, are the responsibility of the Town to be paid or
reimbursed pursuant to this Section 11.
(b) No working capital reserve shall be funded by the Town.
(c) The Manager shall implement the approved Budget and shall be
authorized, without the need for further approval by the Town, to incur the
specified operating expenditures provided for in the Budget in accordance
with Sections 11(d) and
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(e) below. No deviation from the Budget with respect to the payment of
expenses by the Manager shall be permitted, without the prior consent of
the Town, except as follows:
(i) the Manager may reallocate up to five percent (5%) of any
amount budgeted with respect to any operating expense item in the
Budget to another operating expense item budgeted therein provided
that the aggregate expenditures in the Budget are unaffected;
(ii) unbudgeted minor expenditures unforeseen at the time of
preparation of the Budget, and reasonably deemed necessary by the
Manager, may be made without the Town's authorization except that the
aggregate amount of such unbudgeted expenditures cannot exceed $5,000
per year; and
(iii) the Manager may incur expenses which, in the Manager's
reasonable judgment, are necessary due to an emergency requiring
immediate action for the protection of the Facility or persons at the
Facility so long as the aggregate amount of such expenditures does not
exceed 5% of the total amount of operating expenditures set forth in
the approved Budget then in effect.
(d) Purchases of Supplies and Equipment.
(i) The Manager shall, to the greatest extent feasible, arrange
for all purchases of supplies and equipment for the Facility in the
name of the Town and through the Town's purchasing process. To the
extent that the equipment and/or supplies are provided for in the
Budget or are otherwise permitted pursuant to Section 11(c) hereof,
the Town shall take such actions as are necessary to obtain such
supplies and equipment in a reasonably timely manner, and shall be
responsible for payment to the vendors on all such purchases.
(ii) Where exigent circumstances require the immediate
procurement of certain supplies or equipment which are permitted
expenditures pursuant to Section 11(c) hereof, or with respect to the
purchase of supplies and equipment in an amount less than $200, the
Manager shall have the authority to make such purchases directly from
the vendor, and to request reimbursement from the Town for the same.
Such purchases shall be made, wherever possible, using the Town's tax
exempt number which shall be provided to the Manager. The Manager
shall request reimbursement for all such purchases on a monthly basis
and the Town shall be obligated to provide reimbursement within 14
days of receipt of a properly documented request.
(e) The Manager shall be responsible for payment of personnel expenses
incurred pursuant to Sections 11(c) and 20 hereof, subject to the Town's
obligation to reimburse the Manager for the same pursuant hereto. Seven
days prior to each date on which it pays its personnel, the Manager shall
submit to the Town a claim form for the
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payroll expenses it will incur on its next payroll date, with a breakdown
of amounts for each employee and all other information as shall reasonably
be requested by the Town. On the date on which the Manager pays its
personnel, the Town shall make a wire transfer into the Manager's payroll
account or such other account as the Manager shall designate in order to
reimburse the Manager for its personnel expenses. The Manager agrees that
it shall not pay its personnel more frequently than bi-weekly.
(f) Capital expenditures shall be governed by Section 17 of this
Agreement.
(g) With respect to expenditures provided for in the Budget or
otherwise permitted pursuant to Section 11(c) hereof, but not covered by
Sections 11(d), (e) or (f) hereof, the Manager shall be responsible for
payment of such expenditures and shall be reimbursed within 14 days of its
submittal of a claim to the Town following payment. Notwithstanding
anything to the contrary, the Town shall have the right to request that all
utilities be established in the name of the Town, with payment for the same
made directly by the Town to the appropriate supplier.
(h) The Town may, but shall not be required to, withdraw funds from
the Facility Account for the reimbursement or prompt payment when due of
all operating expenses, management fees and all other amounts properly
payable in accordance with the Budget then in effect or otherwise permitted
under the terms of this Agreement. To the extent such items are not paid
from amounts on deposit in the Facility Account, the Town shall use other
Town funds or accounts to meet its obligations to pay or reimburse expenses
under Section 11 hereof.
12. BOOKS AND RECORDS.
(a) With the approval of the Town, the Manager shall establish and
supervise an appropriate accounting and cost control system for Facility
operations to be maintained at the Town's expense. Charts of accounts and
all accounting systems shall be maintained in accordance with ordinary
accounting procedures and generally accepted accounting principles. Such
records shall be subject to examination and photocopying by the Town, its
authorized agents, attorneys and accountants, at the Town's expense, during
normal business hours at the Facility, and the Manager agrees to make such
records available for these purposes. The Manager shall also provide to the
Town any other information, relevant to the management or operation of the
Facility, which the Town reasonably requests and which is in the Manager's
possession or control.
(b) Upon termination of this Agreement for any reason, all source
documents, work papers, financial statements relating to past periods, and
other supporting documents shall be and remain the property of the Town.
Any on-site equipment or systems purchased by the Town, such as cash
registers, software or computers, also shall be and remain property of the
Town. Upon termination of this Agreement, the Manager shall transfer all
policies and procedures manuals to the Town.
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13. FINANCIAL REPORTS.
(a) As soon as possible, but in no event later than 10 days after the
end of each month, the Manager shall deliver to the Town unaudited
financial reports, in such form as the Town requires, for the Facility for
such month which shall include a profit and loss statement comparing actual
results to both the current Budget and the previous year's actual results,
for both the current month and fiscal year to date, on a line item basis.
Within 75 days after the end of each fiscal year, the Manager shall deliver
to the Town an audited profit and loss statement, in such form as the Town
requires, for the Facility for such fiscal year. The cost of providing such
audited profit and loss statement shall be included in the Budget and shall
be paid from the Gross Revenues of the Facility. Such audits shall be
conducted by auditors selected by the Town.
(b) The Manager shall provide to the Town each year audited annual
financial statements, in such form as the Town requires, for the Manager
within 90 days following the close of the Manager's fiscal year.
14. FEES AND CHARGES. Subject to the approval of the Town, the Manager
shall establish, maintain, revise and administer the overall charge structure of
the Facility, including, without limitation, membership fees, greens fees, golf
cart rental fees, food or beverage charges of any kind, pro shop inventory
prices, and prices, charges or fees for any other products, facilities or
services available at the Facility. The Town specifically retains the right to
revoke its approval of any such fees, prices or charges, on not less than 14
days notice to the Manager.
15. LIQUOR LICENSE. The Town shall make every reasonable effort to assist
the Manager in securing for the Facility a liquor license that will permit the
Facility to offer patrons alcoholic beverages in conjunction with their use and
enjoyment of the Facility. The license shall permit the Manager to serve
alcoholic beverages in the normal course of business and to carry out reasonable
management and marketing activities associated with the serving of alcoholic
beverages at a golf facility. The Manager shall comply with all local, county,
state and federal laws and regulations governing the serving of alcoholic
beverages, and shall properly direct all Facility personnel in this regard
through policies, posting of notices and supervision. The liquor license shall
be obtained at the Town's expense and shall remain the property of the Town.
16. REPAIRS AND MAINTENANCE. Within the approved budgetary limitations and
in accordance with the Budget and Section 11 of this Agreement, the Manager
shall arrange for the making or installing, at the Town's expense and in the
name of the Town, of such alterations, repairs, decorations, or replacements of
furnishings or equipment to the Facility as the Manager or the Town deems
reasonable or necessary.
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17. CAPITAL EXPENDITURES.
(a) The Town shall from time to time, at its sole cost and expense,
make such alterations, additions, improvements, repairs and replacements in
or to the Facility as may be necessary to comply with the terms of any debt
or applicable laws and regulations, or to maintain the existing standards
of Club facilities on the date of this Agreement, and the same shall be
made with as little hindrance or disruption as possible to the operation of
the Facility.
(b) The Budget submitted to the Town for its approval each year shall
include the Manager's recommendations for any Facility capital
expenditures. To the extent such capital expenditures are included in the
final Budget as approved by the Town, the Town shall, at its sole
discretion, separately finance the approved capital expenditures through
its municipal borrowing capabilities or, subject to Section 18 hereof,
direct the Manager to arrange for financing of the capital expenditures on
behalf of the Town.
(c) If directed to do so by the Town, the Manager shall have the
responsibility and authority to cause to be purchased, constructed and
installed alterations, additions, improvements, repairs, renewals, and
replacements to the Facility which are of a capital nature.
18. COMPLIANCE WITH LAWS.
(a) The Manager shall arrange at the Town's expense for compliance in
all material and commercially reasonable respects with any federal, state
or local statutes, ordinances, laws, rules, regulations, orders and
determinations affecting or issued in connection with the Facility
(including, without limitation, all federal, state and local labor laws)
and, with the prior written consent of the Town, make arrangements for any
alterations or repairs ordered or required thereby, if not included in the
Budget. However, if any such ordered or required alterations or repairs are
not made because the Town does not give its consent after the Manager's
request therefor, then the Town shall hold the Manager harmless from any
liability that may arise solely by reason of the failure to make such
alterations or repairs.
(b) Notwithstanding any other provision of this Agreement, whenever
any approval, payment or other action is required by the Town hereunder,
such action shall only be taken following compliance by the Town with all
applicable federal, state or local statutes, ordinances, laws, rules,
regulations, orders and determinations.
19. TOWN INDEBTEDNESS. The Manager shall use its best efforts to cause the
Facility to comply with all the terms, conditions and obligations contained in
any note, loan agreement, mortgage, bond issue or other agreement executed by
the Town which relates to the Facility. The Town shall provide the Manager with
true and correct copies of any such note, loan agreement, mortgage, bond issue
or other agreement.
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20. STAFF.
(a) The Manager shall hire, train, promote, discharge, and supervise
the work of the executive staff and all employees of the Facility as is
commercially reasonable; provided, however, that the Town shall have the
right to approve, in its reasonable discretion, the superintendent, head
pro and general manager for the Facility. All persons employed by the
Manager for such purposes shall be deemed employees of the Manager and not
the Town, PROVIDED, HOWEVER, that all of the Manager's cost and expense
related to such persons shall be reimbursed by the Town in accordance with
Section 11 hereof as an item included in the Budget. The Manager shall hire
and employ such personnel at such wages or salaries, and on such terms and
conditions, as are standard at the time in the employment market for such
persons in the geographical area where the Facility is located and are
consistent with the Budget. The Manager shall pay all of the salaries,
wages, payroll taxes and benefits due and owing to and/or on account of
such persons (and the Town shall reimburse the Manager pursuant to Section
11(e) hereof). The Manager shall deduct from such employees' salaries all
required taxes, charges and assessments and shall make and file such
reports as may be required by the federal, state and local government
agencies. All personnel shall be employees of the Manager, (or, at the
Manager's option, a qualified employee leasing company acceptable to the
Town).
(b) The Manager shall be responsible for compliance with all
applicable laws, regulations and tax requirements relative to payroll,
employment and other matters affecting operation of the Facility including,
without limitation, Sections 220, 220-D, 220-E, 222, 230, 231 and 232 of
the New York State Labor Law.
(c) The Manager shall provide such other qualified personnel as shall
be deemed necessary for the successful operation and maintenance of the
Club facilities and the successful marketing and management of the golf
program, membership program, and other business activities at the facility.
The Town shall approve the number and compensation of personnel through the
Annual Plan and Budget.
(d) At the written request of the Town, the Manager shall replace any
manager or employee who, in the opinion of the Town, is not performing
satisfactorily. The Manager shall use commercially reasonable efforts to
replace such individuals within 14 days of receiving such a request.
21. HIRING BY TOWN. The Town is expressly permitted to hire the Manager's
superintendent, club pro, general manager or any other employee of the Manager
working at the Facility following termination of this Agreement for any reason
other than a Town Event of Default.
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22. INSURANCE.
(a) The Manager shall maintain the following types of insurance, in
its own name, with any insurance carrier that is authorized to do business
in the State of New York:
(i) Workers' Compensation and Employer's Liability;
(ii) Comprehensive General Public Liability, on an occurrence
basis, naming the Town and the Solid Waste Management Authority as an
additional insured, in the amount of at least one million dollars per
occurrence; and
(iii) Comprehensive Automobile Liability, on an occurrence basis,
naming the Town and the Solid Waste Management Authority as an
additional insured, in the amount of at least one million dollars per
occurrence.
Any incremental cost to the Manager caused directly by the coverage of the
Facility under the above policies shall be reimbursed by the Town to the
Manager as part of the Budget.
(b) In addition, the Manager shall secure and maintain, in the name of
the Town and subject to the Town's approval, the following types and
amounts of insurance for the term of this Agreement, with the cost thereof
to be included in the Budget:
(i) Employee Dishonesty Policy/Bond, in an amount sufficient to
cover the largest dollar amount of which any one employee may have
possession or control;
(ii) Business Interruption Insurance, in an amount sufficient to
cover the anticipated Gross Revenues in any one fiscal year;
(iii) insurance protection against loss of Gross Revenues by
reason of burglary, larceny, embezzlement, robbery or other causes;
and
(iv) any other insurance which the Town is required by law to
provide.
(c) The Manager shall furnish to the Town certificates of the required
insurance within 30 days of the Effective Date of this Agreement and
thereafter shall furnish new certificates 30 days prior to the expiration
date of the previous certificates.
(d) Any independent contractor arranged by the Manager shall be
required to provide the same insurance coverage as provided in (a)(i),
(ii), and (iii) above, naming the Town and the Solid Waste Management
Authority as additional insureds. Certificates
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of insurance shall be provided to the Town before the contractor is allowed
to begin work at the Facility.
(e) All insurance coverage and bonding required to be provided by the
provisions of this Agreement shall be placed with or through such insurance
company, broker or agency as the Town may from time to time hereafter
designate or approve by written notice to the Manager.
(f) The insurance policies required above shall contain a provision,
if available at a cost approved by the Town, to the effect that such
insurance shall not be invalidated or limited if any one or more of the
insureds thereunder waive any or all claims for recovery from the other
insureds thereunder; and, in addition to any other limitation of liability
expressly set forth in this Agreement, so long as such provision is in
effect, each of the Manager and the Town hereby waives all claims for
recovery from the other for any loss or damage insured under such policies
to the extent of any recovery collected by the Manager or the Town,
respectively, under such policies for such loss or damage.
(g) All policies shall name, as insured, the Town, the Manager, any
mortgagee of the Facility and such other parties as the Town, the Manager
or such mortgagee shall require to be named as insured and shall contain a
waiver of subrogation provision, pursuant to which the insurer waives all
expressed and implied rights of subrogation against each named insured.
23. SECURITY. The Manager shall devise, implement and maintain a program
providing security to the Facility on a 24-hour basis against vandalism,
malicious mischief, theft and other destruction or criminal activity.
24. PERFORMANCE BOND. The Manager shall provide to the Town, at the Town's
expense as an item included in the Budget, a performance bond reasonably
satisfactory to the Town, in an amount not less than $1,000,000, which secures
the operational and other responsibilities of the Manager under this Agreement.
In the preceding sentence, the term "Town's expense" refers only to the payment
of premium and does not include the posting of security or collateral, if
required, which shall be the Manager's responsibility.
25. MANAGER'S COMPENSATION
(a) The Manager's fee shall consist of the aggregate amounts set forth
in this Section 25. The Manager's fee provided for in this Section shall be
included as a line item in the Budget for each calendar year and shall be
payable in accordance with Section 11 hereof in the same manner as other
budgeted Facility operation expenses.
(b) To the extent included in the 1998 Budget or otherwise permitted
under Section 11, the Manager shall be entitled to receive reimbursement of
actual out-of-
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pocket costs for services from the Effective Date of this Agreement to the
date which is 60 days prior to scheduled opening of the Facility's 18-hole
golf course.
(c) Commencing on the date which is 60 days prior to the opening of
the Facility's 18-hole golf course, the Manager shall be entitled to
receive an annual base fee for each calendar year as follows:
1998 $125,000
1999 $150,000
2000 $150,000
2001 $150,000
2002 $175,000
2003 $175,000
2004 $175,000
2005 $200,000
2006 $200,000
2007 $200,000
The amount of such base fee shall be payable in 12 equal installments
payable on the first day of each month included in the calendar year. For
calendar year 1998, the Manager shall only be entitled to receive a
proportionate amount of the annual base fee for the portion of the year
extending from the date on which the base fee becomes payable through
December 31, 1998.
(d) Commencing with the second calendar year of operation of the
Facility under this Agreement the Manager shall be entitled to payment of
an additional incentive management fee equal to 10% of the amount, if any,
by which Gross Revenues for the immediately preceding calendar year exceeds
the below specified threshold amount for the preceding calendar year:
PRIOR YEAR
YEAR PAYABLE THRESHOLD
------------ ---------
1999 $1,600,000
2000 $4,000,000
2001 $4,250,000
2002 $4,500,000
2003 $4,750,000
2004 $5,000,000
2005 $5,150,000
2006 $5,304,500
2007 $5,463,635
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Notwithstanding any of the foregoing, in no event shall the amount of the
incentive management fee payable in a calendar year exceed an amount equal
to 20% of the annual base fee for such calendar year specified in clause
(c) above. No incentive management fee shall be paid in 1998. The incentive
management fee shall be calculated based upon Gross Revenues reflected in
the audited financial reports for the Facility referred to in Section 13(a)
hereof. The incentive management fee shall be payable in 2 equal
semi-annual payments, on June 1 and December 1 of the calendar year. For
example, if the audited financial statements for 2001 show Gross Revenues
of $4,800,000, the Manager would be entitled to receive an incentive
management fee of $30,000 payable in $15,000 installments on June 1, 2002
and December 1, 2002.
(e) The Town acknowledges that the Manager will make an initial
capital contribution to the Facility of $1,000,000 as specified in Section
5(v) hereof. The Manager shall be entitled to the payment of interest on
the outstanding portion of such initial capital contribution which has not
been returned to the Manager at an interest rate equal to the lesser of (i)
two percent (2%) above the prime rate as reported by the Federal Reserve
Bank of St. Louis in its H15 report for the week preceding each interest
payment date or (ii) the actual interest rate paid by the Manager on
financing obtained by the Manager to fund the initial capital contribution
to the Facility. Payment of such interest shall be made quarterly in
arrears on March 1, June 1, September 1 and December 1 of each year
commencing March 1, 1999. The Manager shall be entitled to a return of the
initial capital contribution in five equal annual installments of $200,000
payable on March 1 of each year commencing March 1, 2001. The obligation of
the Town to pay interest on the initial capital contribution and to return
the initial capital contribution to the Manager as provided in this clause
(e) shall constitute a portion of the Manager's compensation for its
Facility management responsibilities hereunder and shall only be payable if
this Agreement remains in force when such payments are due. Subject to
Section 33 hereof, the payment of any such amounts not yet due shall not
survive termination of this Agreement.
(f) It is intended by the Town and the Manager that the management
fees provided for in this Section be in addition to the Facility operating
expenses incurred by the Manager on behalf of or for the benefit of the
Town and for which the Town has full responsibility consistent with the
Budget and the provisions of this Agreement. The Town further covenants and
agrees to reimburse the Manager for any and all reasonable out-of pocket
expenses incurred by the Manager or the Manager's employees in connection
with the performance of the Manager's obligations hereunder, as provided in
the Budget or with the Town's prior approval, up to an initial annual
expense budget of $10,000 for calendar years 1998 and 1999 with reasonable
adjustments thereafter as may be mutually agreed to by the parties.
Reimbursable expenses shall be paid only upon presentation of vouchers
reflecting the name of the person or persons incurring the expense, the
amount and date thereof and the purpose or purposes for the expenditure.
The annual budget submitted by the Manager for approval by the Town shall
include provisions for such expense reimbursement.
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26. CASUALTY.
(a) If the Facility or any portion thereof is damaged or destroyed
during the term of this Agreement by fire, other casualty, or act of God,
the Town shall, at its sole cost and expense, repair, rebuild and replace
the Facility to substantially the same or better conditions as prior to
such damage or destruction unless the proceeds of property insurance
carried under this Agreement are insufficient to pay all of the costs of
repair and restoration. If the Town is required or elects to repair or
rebuild the Facility, the Town shall undertake such work at the Town's sole
expense within a reasonable time after the fire or other casualty, and
shall diligently proceed to complete the same as expeditiously as possible.
(b) If only a part of the Facility shall be taken or condemned in any
eminent domain, condemnation, compulsory acquisition or like proceeding by
any competent authority, and in the reasonable opinion of the Town, the
Facility can be altered, restored or repaired so as to make it a
satisfactory golfing facility of similar type and class as prior to the
taking or condemnation, the Town shall so alter, restore and replace the
Facility if the proceeds of such condemnation will be sufficient to pay for
the costs of same, the Town and the Manager agreeing to pledge so much of
their separate awards, in proportion to the amount awarded to each, as is
necessary for such purposes. Such work shall be commenced reasonably soon
after such proceeds become available and shall be diligently pursued to
completion.
(c) If at any time during the term hereof it becomes necessary, in the
Town's reasonable opinion, to cease operation of the Facility (or any
portion thereof) in order to protect the health, safety and welfare of
patrons or general public, the Manager shall at the direction of the Town
close and cease operation of all or part of the Facility as designated by
the Town. The Manager shall reopen and commence operation when the Town
deems that such may be done without jeopardy to the Facility patrons and
the general public.
(d) No fees shall be payable to the Manager under Section 25 hereof
for any period during which the Facility's 18-hole golf course is
inoperable.
27. EVENTS OF DEFAULT.
(a) With respect to the Town it shall be an event of default ("Event
of Default") hereunder:
(i) if, upon thirty (30) days' notice, the Town shall fail to
make or cause to be made any payment required to be made hereunder;
(ii) if the Town shall fail to keep, observe or perform any
material agreement, term or provision of this Agreement to be kept,
observed or
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performed by it, and such default shall continue for a period of
thirty (30) days after written notice thereof by the Manager is
received by the Town (or a longer period, in no event to exceed 90
days, if the obligation cannot be cured within 30 days so long as the
Town is diligently pursuing a cure to the reasonable satisfaction of
the Manager); or
(iii) if one or more golf holes, the clubhouse, maintenance
building, or any material service of the Facility shall be rendered
incapable of normal operation because of weather, fire or casualty,
and shall not be repaired, restored, rebuilt or replaced within twelve
(12) months after casualty.
(b) With respect to the Manager, it shall be an Event of Default
hereunder:
(i) if the Manager shall fail to maintain the Facility in
accordance with Part I of the Minimum Facility Maintenance Standards
in EXHIBIT B hereto, unless such failure is caused by reasons outside
of the reasonable control of the Manager, and such failure shall
continue for a period of 30 days after notice thereof from the Town;
(ii) if the Manager shall fail to keep, observe, or perform any
other material agreement, term or provision hereof required to be
kept, observed, or performed by it, and such failure shall continue
for a period of thirty (30) days after written notice thereof shall
have been given to the Manager by the Town (or a longer period, in no
event to exceed 90 days, if the obligation cannot be cured within 30
days so long as the Manager is diligently pursuing a cure to the
reasonable satisfaction of the Town); or
(iii) if the Manager becomes insolvent, is declared bankrupt,
voluntarily or involuntarily, becomes unable to pay its bills as they
come due, and/or becomes subject to a court supervised receivership.
(c) The failure of either party to perform any material obligation
under this Agreement due to the occurrence of any of the following shall
not constitute an Event of Default hereunder:
(i) an act of God, hurricane, tornado, landslide, lightning,
earthquake, flood, fire or explosion;
(ii) an act of war, public enemy, blockade, insurrection, riot,
or restraint of government; or
(iii) the failure to obtain, or the suspension, termination or
revocation of, any permit, license or approval necessary for the
operation of the Facility in a manner contemplated by this Agreement,
PROVIDED, HOWEVER, that such failure
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to obtain, or suspension, termination or revocation is not the result
of the willful or grossly negligent action or inaction of the party
relying thereon.
28. REMEDIES UPON DEFAULT.
(a) Subject to clause (c) below, if any Event of Default by the Town
shall occur and continue for a period of 60 days, the Manager may (in
addition to any other remedy available to it in law or equity) forthwith
terminate this Agreement, and remove from the Facility all Manager
employees. In such event, the Manager shall be entitled to immediately
receive payment of all accrued unpaid amounts due to the Manager pursuant
to the terms hereof, after such amounts are ascertainable. If the amount
due and owing is undisputed and remains unpaid for a period of time in
excess of thirty (30) days from the date of determination, then, except for
amounts due under Section 25(e) (which continue to accrue interest at the
rate described therein), the amount shall accrue simple interest at the
rate of six percent (6%) per annum until paid, unless prohibited or limited
under applicable law, in which event such charges shall not exceed the
amount collectible under such law, and neither party shall have any further
obligations whatsoever under this Agreement, except pursuant to the
indemnity provisions hereof.
(b) Subject to clause (c) below, if any Event of Default by the
Manager shall occur and be continuing, the Town may, in addition to any
other remedy available to it in law or equity on account of such Event of
Default, forthwith terminate this Agreement, whereupon the Manager shall
remove the general manager and all Manager employees. In such event, the
Manager shall be entitled to receive payment of all undisputed and unpaid
amounts due the Manager pursuant to the terms hereof, after such amounts
are ascertainable. If the amount due and owing is undisputed and remains
unpaid for a period of time in excess of thirty (30) days from the date of
determination then the amount shall accrue simple interest at the rate of
six percent (6%) per annum until paid, unless prohibited or otherwise
limited under applicable law, in which event such charge(s) shall not
exceed the amount collectible under such law, and neither party shall have
any further obligations to perform under this Agreement, except pursuant to
the indemnity provisions hereof.
(c) If any Event of Default involving nonpayment of amounts due under
this Agreement is not resolved by negotiation of the parties within 60 days
("Payment Dispute") either party may require that such Payment Dispute must
be submitted for resolution in accordance with arbitration as provided in
this Section by delivering a demand for arbitration to the other party.
While any arbitration is pending under this Agreement, no Event of Default
shall be deemed to occur with respect to the nonpayment of the disputed
amount. Each arbitration instituted in accordance with this Section shall
be governed by and conducted in accordance with the following:
(i) The arbitration shall take place in North Hempstead, New York
and shall be conducted by three (3) arbitrators in accordance with the
Commercial
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Arbitration Rules of the American Arbitration Association (the "AAA")
or any successor organization. Each party shall select one arbitrator
and the two (2) arbitrators so selected shall select the third
arbitrator from the AAA's National Panel of Commercial Arbitrators who
shall act as chairperson.
(ii) The award of the arbitrators shall be final, conclusive and
binding on all parties to the arbitration. Judgement upon the award
rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
(iii) In rendering an award, the arbitrators shall, if possible,
identify the party to the arbitration which is the prevailing party
(the "Prevailing Party") and the party which is the non-prevailing
party (the "Non-Prevailing Party") with respect to the Payment Dispute
in question. The reasonable costs and expenses (including legal fees)
incurred by the Prevailing Party in connection with such arbitration
shall be borne by the Non-Prevailing Party. If it is not possible for
the arbitrators to identify the Prevailing Party, the arbitrators
shall determine the proportion of costs and expenses incurred in
connection with such arbitration which are to be borne by each party.
(iv) An award rendered by the arbitrators involving the payment
of money (other than the payment of costs and expenses incurred in
connection with the arbitration) shall include interest from the Event
of Default or other breach of this Agreement at the prime rate
referred to in Section 25(e) hereof as of the date of the award,
PROVIDED, HOWEVER, that such rate shall in no event exceed the maximum
rate payable consistent with applicable State law.
(d) No right or remedy herein conferred upon or reserved to either
party hereto is intended to be exclusive of any other right or remedy, and
each and every right and remedy shall be cumulative and in addition to any
other right or remedy given hereunder, or now or hereafter legally existing
upon the occurrence of an Event of Default hereunder. The failure of either
party hereto to insist at any time upon the strict observance or
performance of any of the provisions of this Agreement or to exercise any
right or remedy as provided in this Agreement shall not impair any such
right or remedy or be construed as a waiver or relinquishment thereof with
respect to subsequent defaults. Every right and remedy given by this
Agreement to the parties hereof may be exercised from time to time and as
often as may be deemed expedient by the parties hereto, as the case may be.
29. INDEMNIFICATION. The Town and the Manager and their affiliates agree to
indemnify and save each other harmless from and against any and all claims,
losses, damages and expenses, including reasonable attorney's fees through all
appeals, arising from the Town's and the Manager's performance pursuant to this
Agreement, or arising out of any willful misconduct, gross negligence or knowing
violation of law on the part of the Town or the Manager or their respective
employees either prior to the date of this Agreement or hereafter;
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PROVIDED, HOWEVER, that one party's indemnity obligation to the other party
under this Section 29 shall not exceed the total amounts previously paid
hereunder to the party from whom the indemnity payment is requested.
30. MANAGER'S DUTIES UPON TERMINATION. Upon the expiration of the term of
this Agreement, or upon the effective date of termination of this Agreement, the
Manager shall:
(a) as expeditiously as reasonably possible and to the extent
permitted by law, surrender and assign to the Town any and all licenses,
permits and/or other governmental authorizations required for the operation
of the Facility;
(b) deliver to the Town any and all of the Town's properties and
assets within the possession of the Manager, including reservation lists,
ledgers, bank statements for the Facility Account, accounting books and
records, insurance policies, bonds and other documents, agreements, leases
and licenses required for the operation of the Facility;
(c) as expeditiously as reasonably possible, prepare and deliver to
the Town the financial reports required under this Agreement with respect
to the final fiscal year; and
(d) purchase from the Town at cost all unbroken cases of inventories
and operating supplies bearing the Manager's Proprietary Marks as defined
below, except those which are identified specifically to the Facility.
31. PROPRIETARY MARKS.
(a) During the term of this Agreement, the Facility shall at all times
be designated and known as North Hempstead Harbor Links. The Manager shall
have the right to use and market the name of the Facility in association
with one or more of the Manager's Proprietary Marks. For purposes of this
Agreement, the term "Manager's Proprietary Marks" means the Manager's
service marks bearing the name Senior Tour Players and related logos used
from time to time by the Manager for services and related products and
business activities (excluding logos directly related to the Facility) in
connection with its owned, managed, or franchised properties, together with
distinctive designs and operating procedures used by the Manager to
identify its properties and services. The Manager hereby disclaims any
ownership interest or right to use the Facility name (except for the right
to use such name in the performance of its responsibilities under this
Agreement) and the Town hereby disclaims any right or interest in the
Manager's Proprietary Marks or the good will derived therefrom.
Notwithstanding the foregoing, upon termination of this Agreement, the Town
shall have the express right to use the then existing supply of inventory
and operating supplies bearing the Manager's Propriety Marks until such
supply of inventory and operating supplies is exhausted, but shall not
reorder any additional such inventory or operator supplies.
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(b) Except for the Manager's Proprietary Marks and any promotional
activity by the Manager regarding use of the Facility as contemplated by
the Annual Plan, the Town shall retain exclusive ownership and control of
all rights pertaining to marketing, advertising or other promotional
activities with respect to any portion of the Facility.
32. ASSIGNMENT. The Manager may not directly or indirectly transfer, sell,
assign or hypothecate its interest under this Agreement or any right hereunder
to any other entity or person, without the prior written consent of the Town
which consent shall not be unreasonably withheld or delayed. The Town shall have
the right at any time to sell, assign or transfer all or a part of its right,
title and interest under this Agreement to
(a) the holder of any mortgage or deed of trust on the Facility, or
(b) any person or entity on the condition that
(i) this Agreement continues in full force and effect after such
transfer (with such amendments to the definitions contained in this
Agreement as may be reasonably necessary or appropriate),
(ii) the transferee assumes the obligations of the Town,
(iii) such transferee in the reasonable business judgment of the
Manager, has the financial capacity to perform the obligations of the
Town hereunder, is not of ill repute or is not in any other manner a
person, firm or corporation with whom or with which an association
would materially adversely affect either Facility operations or the
reputation and status of the Facility or the Manager.
33. EXTRAORDINARY RETURN OF CAPITAL CONTRIBUTION. In the event that this
Agreement is terminated due to any reason other than a Manager Event of Default
under Section 27(b)(i) or (iii) of this Agreement, the Town agrees to pay to the
Manager as a lump sum an amount equal to the unreturned portion of the Manager's
initial capital contribution to the Facility plus any accrued and unpaid
interest thereon under Section 25(e) hereof. This is not intended to be an
exclusive remedy and shall not relieve the Town of its other obligations under
this Agreement.
34. NOTICES. Any and all notices, consents, or directives by either party
intended for the other shall be sent by registered or certified mail, return
receipt requested, to the following address, unless either party shall have
designated a different address by serving written notice of change of address on
the other party by registered or certified mail:
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Town: Town of North Hempstead
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Supervisor
With a copy to: Department of Parks and Recreation
0000 Xxxxxxxxx Xxxxxx
Xxx Xxxx Xxxx, XX 00000
Attention: Commissioner
Manager: Senior Tour Players Development, Inc.
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
35. SALE OR TRANSFER OF CONTROL OF FACILITY. In the event of the sale or
other transfer of control over the Facility, other than to any agency that is
affiliated with or controlled by the Town, this Agreement may be (a) terminated
by the Town without any further liability, or (b) assigned by the Town to the
purchaser in accordance with Section 32 hereof.
36. TOWN TERMINATION RIGHTS.
(a) The Town shall have the right to terminate this Agreement within
30 days of its receipt of the audited financial statements referred to in
Section 13(a) hereof if the annual net cash flow to the Town hereunder for
any two consecutive calendar years after 1999 does not exceed $1,500,000
per year. For this purpose, "net cash flow" shall mean for each calendar
year the amount of Gross Revenues less Facility operating expenses
(excluding payment of debt service on the Town's outstanding bond issue
used to finance the Facility) and all fees paid to the Manager under
Section 25 hereof.
(b) The Town shall have the right to terminate this Agreement at any
time, on 30 days notice to the Manager, in consideration of payment to the
Manager (in addition to amounts otherwise payable under this Agreement) of
an amount equal to the fixed fee amount set forth in Section 25(c) for the
then current calendar year.
37. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement of the
parties hereto and cannot be changed or modified except by another agreement in
writing signed by the party sought to be charged therewith or by its duly
authorized agent.
38. EXECUTED COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed an original.
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39. CAPTIONS. The captions of various of the provisions of this Agreement
are included for convenience only, and are in no way to be construed as part of
this Agreement or as a limitation upon the scope of the particular provisions to
which they refer.
40. SUCCESSORS AND ASSIGNS. This Agreement and all the provisions hereof
shall be binding upon, and shall inure to the benefit of, the parties hereto and
their respective successors and assigns.
41. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of New York.
42. SEVERABILITY. If any of the provisions of this Agreement shall be
construed to be illegal or invalid, such construction shall not affect the
legality or validity of any of the other provisions hereof, and the illegal or
invalid provisions hereof shall be deemed stricken and deleted from this
Agreement to the same extent as if never incorporated herein, but all other
provisions hereof shall remain in full force and effect.
43. NO THIRD PARTY BENEFICIARIES. It is the intention of the parties to
this Agreement that no third party shall have the benefit of or any rights under
any of the provisions hereof.
44. RELATIONSHIP. In the performance of its responsibilities and the
exercise of its authority under this Agreement, the Manager shall act as an
independent contractor with respect to the Town. Neither this Agreement nor any
agreements, instruments, documents or transactions contemplated hereby shall in
any respect be interpreted, deemed or construed as making the Manager an agent,
partner or joint venturer with the Town or as creating any similar relationship
or entity, and each party agrees that it will not make any contrary assertion,
contention, claim or counterclaim in any action, suit or other legal proceedings
involving the Manager or the Town.
45. RIGHT TO MAKE AGREEMENT. Each party warrants, with respect to itself,
that neither the execution of the Agreement nor the finalization of the
transactions contemplated hereby shall violate any provision of law or judgment,
writ, injunction, order or decree of any court or governmental authority having
jurisdiction over it, result in or constitute a breach or default under any
indenture, contract, other commitment or restriction to which it is a party or
by which it is bound, or require any consent, vote or approval which had not
been given or taken. Each party covenants that it has and will continue to have
throughout the term of the Agreement and any extensions thereof, the full right
to enter into the Agreement and perform its obligations hereunder.
46. PERMANENT CLUBHOUSE. The Manager acknowledges the intention of the Town
to construct a permanent clubhouse for the Facility at some time during the term
of this Agreement. The Manager shall cooperate with the Town and the persons
working on construction of the permanent clubhouse so as to minimize any adverse
affect on the operation of the Facility during
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construction. The Manager shall submit to the Town for its approval a revised
budget for the Facility during construction of the permanent clubhouse.
47. ADVISORY COMMITTEE. The Town and the Manager shall form an advisory
committee to make recommendations to the Town regarding major issues with
respect to the Facility such as, without limitation, course alterations, any
proposed action which significantly impacts the number of rounds played,
promotions or tournaments.
48. REFERENCES FOR DEFINED TERMS. The Capitalized terms used in this
Agreement are defined in the following provisions:
"AAA" is defined in Section 28(c)(i).
"Agreement" is defined in the first paragraph.
"Annual Plan" is defined in Section 6(a).
"Budget" is defined in Section 6(a).
"Effective Date" is defined in Section 3.
"Event of Default" is defined in Section 27(a).
"Facility" is defined in the first WHEREAS clause.
"Facility Account" is defined in Section 11(a).
"Gross Revenues" is defined in Section 6(c)(i).
"Manager" is defined in the first paragraph.
"Manager's Proprietary Marks" is defined in 31(a).
"Minimum Facility Maintenance Standards" refers to Exhibit B.
"Non-Prevailing Party" is defined in Section 28(c)(iii).
"Payment Dispute" is defined in Section 28(c).
"Prevailing Party" is defined in Section 28(c)(iii).
"Town" is defined in the first paragraph.
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IN WITNESS WHEREOF, the parties have caused this instrument to be executed
on the day and year first written above.
TOWN:
THE TOWN OF NORTH HEMPSTEAD
By: /s/ May Xxxxxxxxx
--------------------------
Title: Supervisor
--------------------
Date: 1/27/98
--------------------
MANAGER:
SENIOR TOUR PLAYERS DEVELOPMENT, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Title: President
--------------------
Date: 1/27/98
--------------------
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EXHIBIT A
DESCRIPTION OF ASSETS
---------------------
o Maintenance Building
o Chemical Storage Building
o Pump Station Building
o Irrigation Pond
o Maintenance Building Parking Lot & Site Lighting
o All Gravel Maintenance Roads
o Clubhouse Building
o Driving Range
o Clubhouse Parking Lot & Site Lighting
o Clubhouse Landscaping
o Cart Storage & Fueling Facilities
o Clubhouse Entry Roadway
o 18 Hole "Harbor Links" Golf Course
o Practice Putting Green
o Cliff Areas
o 9 Hole Executive Course
o 18 Hole Miniature Golf Course
o Athletic Fields (5)
o Rain Shelters
o Hub Building
o Hub Building Parking Lot & Site Lighting
o Hub Landscaping
o All Temporary Buildings & Facilities
o All Golf Course(s) Signage
A-1
28
EXHIBIT B
MINIMUM FACILITY MAINTENANCE STANDARDS
PART I. BASIC RESPONSIBILITIES
----------------------
1. The Manager shall establish written guidelines for greens, tees and
aprons, fairways, driving ranges, roughs, hazards, landscaping and
clubhouse maintenance.
2. The Manager shall establish written guidelines for clubhouse and
pro shop operations.
3. The Manager shall maintain a representative reasonably available in
person or by telephone to address issues or questions raised by the Town.
4. The Superintendent shall be Class "A".
5. The greens shall be aerated, topdressed and overseeded a minimum of
two times per calendar year.
6. The pin placement shall be changed daily.
7. The tees and aprons shall be aerated, topdressed and overseeded a
minimum of two times per year.
8. The sand in the traps shall be maintained at an 8" depth on slopes
and a 6" depth on the bottom.
9. Restrooms shall be maintained a minimum of once each day.
10. The pro shop shall not be closed for maintenance and/or cleaning
during normal business hours.
PART II. GOLF COURSE MAINTENANCE
-----------------------
A. SUPERVISION OF MAINTENANCE:
1. The Superintendent shall be Class "A" and shall be responsible for
supervising the maintenance of the course.
X-0
00
X. XXXXXX XXXXXXXXXXX:
1. Mowing the Greens: The greens shall be mowed daily, depending on
growth and weather, and will be maintained to an adequate playing level.
2. Watering of Greens: The crew shall water the greens as necessary to
keep the grass in optimal growing condition, weather permitting.
3. AERIFYING, TOPDRESSING AND OVERSEEDING OF GREENS:
a. The crew shall aerify the greens a minimum of two times per
year using a greens aerifier manufactured for the purpose.
b. The crew shall topdress the greens a minimum of two times per
year in conjunction with aerifying of greens. The crew will institute,
at the Manager's discretion, a light frequent top-dressing to keep
surface smooth.
c. The crew shall overseed each green a minimum of two times each
year during the aerifying/topdressing process.
4. VERTICUTTING OF GREENS: The greens shall be verticut a minimum of
four times per year, at the Manager's discretion, to control "graining" or
"thatching."
5. FERTILIZING THE GREENS: Soil samples shall be submitted to an
approved Soil and Plant Analysis lab a minimum of four times for the first
year and once annually thereafter.
6. PEST CONTROL ON GREENS: Pest control management of the greens is
considered to be a constant ongoing responsibility of the Superintendent.
7. WEED CONTROL ON GREENS: The Manager shall develop and maintain a
program for weed control on the greens. As in most northeastern courses,
bluegrass will be inevitable despite the Manager's best efforts to keep it
to a minimum.
8. OTHER GREEN REQUIREMENTS: The crew shall change the pin placements
daily and replace damaged cups immediately upon discovery.
C. MAINTENANCE OF TEES AND APRONS:
1. MOWING OF TEES AND APRONS: The crew shall mow all tee areas and
aprons around the greens not less frequently than three times per week,
weather dependent.
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2. AERIFYING AND TOPDRESSING OF TEES AND APRONS:
a. The tees shall be aerated a minimum of two times per year or
more as needed.
b. The aprons shall be aerated two times per year. Plugs shall be
chopped and returned to the apron surface, unless deemed undesirable
by the Manager.
3. VERTICUTTING OF TEES AND APRONS: Tees and aprons shall be verticut
a minimum of two times per year.
4. FERTILIZING OF TEES AND APRONS: Soil samples shall be submitted to
an approved soils and plant analysis lab a minimum of four times for the
first year and once annually thereafter.
5. WEED CONTROL ON TEES AND APRONS: The superintendent shall develop
and maintain a program for weed control on tees and aprons.
6. OVERSEEDING OF TEES AND APRONS:
a. The crew shall overseed the tees and aprons two times per year
during the aerifying process.
b. All divots on tees and aprons shall be filled with a
topdressing/seed mixture on a weekly basis.
D. MAINTENANCE OF FAIRWAYS, DRIVING RANGES, AND ROUGHS:
1. MOWING OF FAIRWAYS, DRIVING RANGES, AND ROUGHS:
a. The fairways shall be mowed twice weekly at a height of 5/8 to
3/4 inches.
b. The driving range shall be mowed once a week at a height of
one inch.
c. The roughs shall be mowed weekly.
2. AERIFYING OF FAIRWAYS/DRIVING RANGE/ROUGHS: The fairways, driving
range, and roughs shall be aerated a minimum of one time per year or as
needed, using an aerifier with a 5/8" diameter spoon and a minimum
penetration depth of three inches.
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3. VERTICAL MOWING OF FAIRWAYS/DRIVING RANGE/ROUGHS: Verticle mowing
of the fairways, driving range and roughs is not required except in
extraordinary circumstances for disease control and at the discretion of
the Manager.
4. FERTILIZATION OF FAIRWAYS/DRIVING RANGE/ROUGHS: Soil samples should
be submitted to an approved Soils and Plant Analysis lab a minimum of four
times for the first year and once annually thereafter.
5. WEED CONTROL ON FAIRWAYS/DRIVING RANGE/ROUGHS: The Manager shall
develop and maintain a program for weed control on the fairways, driving
range and roughs.
E. SAND HAZARD MAINTENANCE: The sand level in each trap shall be maintained
at an 8" depth on slopes and a 6" depth on the bottoms. Sand for the traps shall
be the same as the initial construction specifications.
F. TREES, SHRUBS, AND OTHER LANDSCAPING:
1. The Manager shall be responsible for the maintenance of all
landscaping at the course.
2. The Manager shall develop and maintain a program for weed control
of the landscaped areas.
G. MAINTENANCE OF IMPROVEMENTS, EQUIPMENT, ETC. NOT A HORTICULTURE NATURE:
1. IRRIGATION/PORTABLE WATER SYSTEM/UTILITIES/WATER:
a. The Manager shall maintain the irrigation systems on the
course as outlined below:
i. Maintenance means the cleaning, adjusting, repair and
replacement of all components of the pumping and irrigation
systems downstream of the pump control panels and the main
sprinkler control panel.
(a) The maintenance will include but not be limited to:
1. Gate Valves
2. Lateral irrigation lines
3. Automatic Valves
4. Irrigation Controllers to valves
5. Wiring from Controllers to valves
6. Controller Transformers
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7. Sprinkler Heads
8. Quick Coupler Valves
9. Main lines
10. Computer Wires
(b) The Manager shall provide all mainline repairs and
materials. All material used in repair or replacement shall
be as materials used in the original installation or a Town
approved equal or upgrade.
(c) The Manager shall develop and maintain a program
for controlling the weed and fungus control in the golf
course lakes.
ii. The Manager shall be responsible for maintenance of the
portable water system on the course.
(a) All portable water lines from the street meter(s)
to the Clubhouse, maintenance building, and to the restrooms
shall be the Manager's responsibility. This includes
backflow devices and their yearly checks.
b. All portable water lines serving water fountains, quick
couplers faucets, etc. on the course itself shall be the
responsibility of the Manager.
c. All indoor plumbing in the course restrooms and in the
maintenance building shall be the maintenance responsibility of the
Manager.
d. The Manager is responsible for keeping all water coolers and
drinking cups located on the course filled and replenished at all
times.
H. NON-HORTICULTURE MAINTENANCE RELATED TO PLAY ON THE COURSE:
1. The Manager shall be responsible for the maintenance of all tee
markers, cups, flags, ball washers, trap xxxxx, yardage signs, and benches
on the course.
2. The ballwashers located around the course shall be serviced daily.
3. The crew shall pick up litter throughout the course on a daily
basis.
I. RESTROOM STANDARDS:
1. During play season and dependent on weather, restrooms shall be
maintained a minimum of once per day and more often when heavy use occurs.
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2. The Manager shall be responsible for the removal of graffiti as
soon as possible after it is discovered.
J. FENCE AND CART PATHS: Repair and replace all broken or damaged fencing.
K. CLUBHOUSE/PRO SHOP STANDARD:
1. The Pro Shop staff shall be responsible for the maintenance and
cleaning of the Clubhouse/Pro Shop Area.
a. Vacuum all carpets daily.
b. Clean all ashtrays daily.
c. Empty wastebaskets and clean daily.
d. Sweep all building entrances daily.
e. Clean window glass in the doors inside and outside weekly or
more often as needed.
f. Clean all windows in the Pro Shop and office inside and
outside once every three months or more often as needed.
g. Replace lamps in light fixtures as soon as possible after
discovery.
2. All cleaning supplies, equipment maintenance items, and paper goods
shall be supplied by the Manager.
3. The Pro Shop shall not be closed for maintenance and/or cleaning
during normal business hours.
L. MAINTENANCE OF IMPROVEMENTS, EQUIPMENT, ETC. NOT RELATED TO PLAY ON THE
GOLF COURSE:
1. The crew shall be responsible for the cleanliness of the
maintenance yard area and the superintendent's office on a daily basis.
2. The crew shall be responsible for the daily litter pickup on all
paved and non-paved surfaces of the course.
3. The crew shall maintain clean edges on all roadways, parking lots,
and cart paths by monthly edging or spraying of the plant growth.
M. GENERAL PROVISIONS:
1. All maintenance and operational standards are subject in all
respects to weather and other conditions beyond the reasonable control of
the Manager.
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2. At the request of the Town, but in any event no less frequently
than once per year, the Manager, the advisory committee and representatives
of the Town shall meet to review and discuss mutually agreeable revisions
to Parts I and II of this EXHIBIT B.
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