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Item 10A AgreementCity of Southlake, Texas MEMORANDUM March 14, 2005 TO: Shana Yelverton, City Manager FROM: Malcolm Jackson, Director of Community Services SUBJECT: Authorize the Mayor to execute a Tennis Center Management Agreement with Roxy Tennis, LLC, dba "Southlake Tennis Center" Action Requested: City Council authorization for the Mayor to execute a Tennis Center Management Agreement with Roxy Tennis, LLC, dba "Southlake Tennis Center" (Stephen and Mia Poorman) to allow for three year renewal periods. Background Information: Effective April 25, 2002, the City entered into an agreement with Stephen and Mia Poorman as Roxy Tennis, LLC for the management and operations of the Southlake Tennis Center. The current term of the agreement is for a three year period with automatic one year renewals. Per Article 3, Sec 3.1, either party may request in writing sixty days prior to the expiration date to renegotiate the terms of the agreement. The City submitted a written request to the Poorman's to renegotiate the term of the agreement with the intent to allow for three year renewals. Three year renewal options allows for continued stability of the tennis center operations and also meets the Poorman's desire for commitment from the City to support their investment in additional computer and software upgrades, and new program development. There are several document word changes as recommended during review by the city attorney for purposes of clarification of contract terms and compliance with current legal mandates, but no other substantive changes are requested as compared to the original contract intent. Over the past three years Stephen and Mia Poorman have provided stability to the Tennis Center through their management and operations of the facility. New programs have been introduced or expanded to include the youth tennis program, USTA Women's Tournament, lessons and clinics. Community based activities are also a part of their operations and include the S. 0. S. Tournament benefiting the Women's Shelter, CISD High School challenge matches and UIL tournaments, and this spring the Poorman's will be undertaking the middle school tennis program with on site lessons at Dawson and Carroll Middle schools, at no cost to the CISD. Financial Considerations: The City currently receives approximately $6,950 annually in revenue from the Tennis Center. The City is responsible for the physical maintenance of the building and grounds, and utilities. The Contractor is responsible for all furnishings, equipment, telephone, and staffing costs. Shana Yelverton, City Manager March 14, 2005 Page 2 Financial Impact: Renewal of this agreement is not anticipated to result in any new financial impacts beyond what is listed above. Citizen Input/ Board Review: The Parks Board recommended approval of the proposed agreement and renewal for the management of the Tennis Center (8 -0) at their February 17, 2005 meeting. The original Tennis Center Management Agreement was approved by the City Council and executed on April 25, 2002. Legal Review: The proposed agreement was reviewed by the City Attorney with minor non- substantial modifications in addition to proposal to allow for three year term renewals. Alternatives: City Council consideration may result in the following: • Approve as proposed • Approve with other modifications as may be proposed by the Council • Decision not to approve Supporting Documents Staff Recommendation: Supporting documents include the following: • Copy of letter to Stephen and Mia Poorman (dba. Roxy Tennis) from City of Southlake expressing the desire to renegotiate the terms of the Management Agreement • Proposed Tennis Center Management Agreement City Council authorization for the Mayor to execute a Tennis Center Management Agreement with Roxy Tennis, LLC, dba " Southlake Tennis Center" (Stephen and Mia Poorman) to allow for three year renewal periods. 3 -17 -05 / Tennis Renewal / • Formatted: Font: Not Bold ---------------------- - - - - -- ------------------------------ - - - - -' Formatted: Left City of South lake Parks and Recreation February 1, 2005 Roxy Tennis LLC, ( Southlake Tennis Center) c/o Stephen Poonnan, member 220 Canvon Lake Drive Southlake, Texas 76092 Dear Mr. Stephen Poomian and Mrs. Mia Gordon - Poonnan, On or about April 25, 2002, the City of Southlake entered into a management agreement regarding the Southlake Tennis Center. Article 3 of agreement specifies that the tenn ofthe agreement extends to April 25, 2005 unless otherwise terminated or modified. It further states that the agreement is automatically renewable for successive one -year terms, unless either party request in writing at least sixty (60) days prior to expiration. This letter serves as notice that the City of Southlake desires to renegotiate the terms ofthe Management Agreement. Please contact our office to discuss the details and applicable presentations to the Parks Board and the City Council. You may contact our Administrative Secretary Linda Carpenter at 817 - 481 -1542 to set up a meeting date and time. We look forward to discussing this matter with you in greater detail. Sincerelv. Malcolm Jackson, Director Community Services .- - - Formatted: Left, Indent: Left: 0.5" Cc: Shana Yelverton, Acting City Manager, City of Southlake Lori Farwell, City Secretary, City of Southlake .- - - Formatted: Left, Indent: Left: 0.5 ", First line: 0.5" Mailed Certified and Regular U.S. Mail Formatted: Left, Indent: Left: 0.5" ---------------------------------------------------------- - - - - -- -- Formatted: Font: Times New Roman, 12 pt, Not Bold Formatted: Left, Indent: Left: 0.5" 400 North White Chapel • Southlake, TX 76092 MANAGEMENT AGREEMENT THIS TENNIS CENTER MANAGEMENT AGREEMENT ( "Agreement ") is made between the City of Southlake, Texas ( "CITY "), a municipal corporation, and Roxy Tennis LLC, a Texas limited liability company, dba "Southlake Tennis Center" ( "CONTRACTOR "). WHEREAS, CITY desires that CONTRACTOR manage the operation of the CITY'S tennis center; NOW, THEREFORE, CITY AND CONTRACTOR AGREE as follows: ARTICLE 1. DEFINITIONS Unless the context clearly indicates otherwise, in this Agreement: BEGINNING DATE means the date on which CITY gives CONTRACTOR written notice to begin management of the tennis center. EXPIRATION DATE means three (3) years after the beginning date or, if the Agreement is automatically renewed, as provided in Section 3.1, any annual anniversary of the original expiration date. FISCAL YEAR means the period beginning October 1 of any year and ending September 30 of the following year. TENNIS CENTER means the property and all improvements located on the Property, including, but not limited to the clubhouse, and any other tennis courts the City may make available to the CONTRACTOR as provided herein. OPERATING ADVANCE ACCOUNT means an interest - bearing account maintained by CONTRACTOR for the deposit of funds received from customers for the operations of the tennis center. PROPERTY means the land on which the tennis center is located as iRd-iGated- eR the ma a ttonhed as Exhibit o, at 450 W. Southlake Boulevard, Southlake, Texas. STANDARD COMPARABLE TO SPECIFIED TENNIS CENTERS IN THE REGION means a standard of operation comparable to the operation of moderately priced private tennis centers and comparable municipal tennis centers in the region, including, but not limited to municipal tennis centers in Fort Worth, Arlington, North Richland Hills, and the Bayard H. Friedman Tennis Center at Texas Christian University. "NON- LEAGUE OPEN PLAY" means any court usage other than private lessons or leagues. "LEAGUE" means any regularly scheduled, organized team competition with a season of more than six weeks. ARTICLE 2. GENERAL REQUIREMENTS §2.1 Management of the tennis center. CITY hires CONTRACTOR to manage, supervise, and operate the tennis center in accordance with this Agreement. CITY delegates to CONTRACTOR the responsibility and authority to implement operating policies and charge court usage fees, both of which are subject to approval by CITY'S Council, and take other actions necessary to operate the tennis center in a manner that meets a standard comparable to specified tennis centers in the region. Other than court usage fees, all pricing associated with lessons, leagues, drills, camps, services, food and beverages, shall be at the discretion of the CONTRACTOR. §2.2 Independent contractor. CONTRACTOR is an independent contractor with respect to the CITY and the City shall not have the authority or responsibility to supervise the day -to -day activities of the CONTRACTOR or CONTRACTOR's employees, and nothing in this Agreement and its performance shall create an employment or agency }h e- relationship between CITY and CONTRACTOR . Nevertheless, CONTRACTOR agrees to seek advice from CITY and cooperate with CITY in his management of the tennis center and the parties both agree to cooperate with each other regarding the management of the Tennis Center §2.3 Use of the property. CITY grants to CONTRACTOR the use and possession of the property during the term of this Agreement for the purposes of managing and operating the tennis center, subject to the rights of CITY under this Agreement. (a) In addition, CITY Ci#y will make available to CONTRACTOR the two tennis courts located in Bicentennial Park near the water tower (the "hill ") for CONTRACTOR's exclusive use Monday through Friday, 8:00 a.m. to 12:00 p.m. On occasion, CITY may make these courts available to CONTRACTOR at other times for tournaments or other special events. §2.4 City's right to inspection. CITY and its representatives have the right at all reasonable times to enter upon and to examine and inspect the tennis center for any reason. In the event of a default, CITY has the right of access to the tennis center that is reasonably necessary to cause the proper maintenance of the tennis center. ARTICLE 3. TERM §3.1 Term. The term of this Agreement is three (3) years, commencing on the beginning date, unless terminated earlier under one of the following provisions. This Agreement is automatically renewable for successive three 3 e9 e year terms, unless either party requests in writing at least 60 days before the expiration date- to renegotiate the terms of the Agreement. Nothing in this Article shall be construed as a limitation on either party's right to terminate this Agreement in accordance with Section 9.6 hereof. ARTICLE 4. RESPONSIBILITIES OF CONTRACTOR §4.1 Operation of the tennis center. In the management, supervision, and operation of the tennis center, CONTRACTOR shall: (a) operate the tennis center as a municipal tennis center, open to the general public without discrimination on any basis prohibited by applicable law, regulation or ordinance subject to fees, rules, and policies approved by the CITY; (b) retain employees sufficient and necessary to assure operation of the tennis center at a standard comparable to specified tennis centers in the region; (c) maintain restrooms, showers, and locker rooms in a clean and sanitary condition at all times; (d) provide food and beverage service and sales, offering a variety of food; (e) operate a tennis pro shop, offering merchandise comparable to pro shops at specified tennis centers in the region, and maintain an annual average minimum wholesale inventory of $15,000 of merchandise in stock in the pro shop. (f) CONTRACTOR will ensure that the staff is trained in providing customer service, and that staff is discrete and polite concerning complaints or concerns about the tennis center; (g) maintain the tennis center in a condition that is generally accepted in the tennis industry as safe; (h) maintain the courts and all elements of the tennis center in optimum playing condition, in accordance with a standard comparable to specified tennis centers in the region; (i) maintain all personal property in good working order and replace items when necessary to operate the tennis center at a standard comparable to specified tennis centers in the region; (j) comply with all applicable government health, safety and environmental regulations; (k) operate the tennis center in an efficient and cost effective manner; and collect membership and court reservation fees in amounts approved by the CITY; (1) pay all operating expenses of the tennis center, except for those expenses which the CITY agrees herein to pay for (i) repairs, and (ii) water, sewer, electricity and natural gas expenses, which shall be paid by CITY. (m) provide a full -time tennis professional with current membership in the USTA, who is certified through the USPTA to provide lessons and coordinate events in accordance with USPTA standards The tennis professional and a sufficient number of CONTRACTOR's staff must maintain First Aid and CPR certification. (n) k the Center open during certain standard w#4 - days and hours of operation as provided herein and as approved in writing by the Director of Community Services. (o) Prohibit sales_ possession ander consumption of alcohol on the tennis center premises at any time and prohibit anyone who is intoxicated to play tennis. (p) Reserve two (2) tennis courts for open play at all times, except during USTA sanctioned tournaments expressly permitted herein ( QONTRA -TOR agrees +„ schedule no more than nine USTA tournaments per year, a maximum of four of which may be s tie -Red utiliz�e+ 4g the entire tennis center complex. Not more than two tournaments may be scheduled per month and no tournament is to continue longer han fourteen day , - comment [TGSI]: You should specify the - - y - - standard or a maximum length for a (r) Require the tennis professional on site to r Petain the physical condition necessary to tournament. perform the duties and responsibilities of the Agreement. (s) Not cause to be placed any sign or advertisement upon the premises or upon the property of CITY without the prior written consent of the CITY. (t ) QQNT-RA(2_TQR he pemitted tease eF P@rt+al!Y Giese the te-RAM'S en t e r +„r G II In t han 1n.nn d@y GITV the hf t r_ - - S2�"+P t21' t r���r; =�s�, Formatted: Bullets and Numbering �o21at2f P.M. y mo o,- ��-- r���grr� (e)The ) o fho G not ng of fho ton Am no nfor of oll fimoo nfhor fhon A- fhic §4.2 Rules and policies. CONTRACTOR shall obtain CITY'S approval before implementing or changing clubhouse and ground rules or other policies affecting the public's use of the tennis center, including changes to hours of operation. CONTRACTOR agrees not to utilize the Property without the CITY'S prior written approval for any purpose other than for conducting tennis programs .^,- ritheut the CITY'S p r i er Fitton a a provided, however, that CITY'S approval shall not unreasonably be withheld. CONTRACTOR will be permitted to close or partially close the tennis center for -, - Formatted: Font: (Default) Arial inclement weather (on -qoinq rain or snow, temperatures below 40 F, or approaching severe Formatted: Normal -Kim, Indent: First line: 0.715° weather such as tornadoes) with appropriate notice given to CITY in a form determined by the Director of Community Services. The Center shall close not later than 10:00 p.m. on any day. CITY reserves the right to approve the closing of the tennis center at times other than as provided in this Agreement.. - Formatted: Font. (Default) Arial §4.3 Promotion of tennis activities. (a) CONTRACTOR agrees to use reasonable efforts to conduct a continuous program of advertising, public relations, and promotional activities to assure that the tennis center has an appropriate and ongoing visual image and presence in print and communications media. (b) CONTRACTOR shall offer Southlake residents the opportunity to register early for all tennis activities. 44L(ILCONTRACTOR may market and sell patron facility cards that allow for open-- - - Formatted: Bulletsand Numbering play reservation privileges, but shall ensure that Southlake residents who are non -card holders- are afforded the opportunity to make open play court reservations prior to non - residents regardless of whether such non - residents hold patron facility cards §4.4 Tennis center personnel. (a) CONTRACTOR shall recruit, interview, and hire the employees for the tennis center, including management, tennis professionals, food and beverage staff, child care providers, maintenance personnel, janitorial staff, and others determined by CONTRACTOR to be necessary for the operation of a facility comparable to specified tennis centers in the region. All personnel shall be employees of CONTRACTOR or independent sub - contractors of CONTRACTOR, and not employees of CITY. (b) CONTRACTOR shall ensure that its employees have a professional appearance at all times, and that all employees shall wear neat appearing uniform shirts, or nametags clearly identifying them as employees of tennis center. (c) CONTRACTOR shall establish requirements for employees at least as stringent as those established by felfev he CITY'S personnel policies with respect to CONTRACTOR's employees assigned to the Tennis Center, including the responsibility to conduct pre - employment and annual criminal background checks and pre - employment and for -cause drug screenings. CONTRACTOR shall not assign to the Tennis Center, even on a temporary basis, any person who fails such checks or screenings. CONTRACTOR will provide results of such screenings to CITY. CITY will provide a copy of the CITY'S personnel policies to CONTRACTOR and arrange for CITY'S Director of Human Resources to review all applicable policies. CITY will also inform CONTRACTOR regarding CITY'S current testing and screening procedures and vendors. §4.5 Operations review. (a) Periodically, but not less than once a month, CONTRACTOR shall meet with CITY staff and review its management, promotional activities, programs, finances, and policy recommendations concerning the tennis center. (b) CONTRACTOR shall keep CITY fully informed of all tennis center management activities and operations and shall provide the weekly, monthly and annual reports similar to, and containing the information specified, as those in Exhibit A& §4.6 Licenses, bonds and permits. CONTRACTOR shall obtain all licenses and permits required by governmental entities for activities conducted at the tennis center. ARTICLE 5. CONSIDERATION §5.1 Amounts due to city. On or before the tenth day of each month, beginning with the first month following the beginning date of the Agreement, CONTRACTOR shall pay CITY the fees as stipulated below. A $25 fee will be charged for any checks returned from CONTRACTOR'S bank for insufficient funds. A five percent (5% ) late fee will be charged if payments are not made to CITY within five (5) days of the due date. (a) During Year 1 of contract: 10 % of gross receipts for the prior month less sales tax, from all court usage �eesj CONTRACTOR shall be allowed to defer - actual - - comment [TGS2]: what about merchandise sales? Concession sales? Are they to be payment of CITY's earned receipts for first three (3) months, however, these covered, and do we get a share of those amounts? If so, they should be listed here. accrued payments shall become due and payable on a pro -rated basis during the remaining nine (9) months of the contract year. (b) During Year 2 of contract: 10% of gross receipts for the prior month less sales tax, from all court usage fees. (c) During Year 3, and any subsequent years of contract: 10% of gross receipts, less sales tax, from all court usage fees. (d) In the event City chooses to seek a ruling from the State Comptroller regarding the collection of sales tax on court usage fees. -aPA .- - - Formatted: Indent: Left: I" In the event the State Comptroller rules that sales taxes do not need to be collected on court usage fees, Contractor agrees to pay City 15% of gross receipts from court usage fees in Year 1, and 20% of gross receipts from court usage fees in subsequent years. §5.2 Management fee due to contractor. As consideration and compensation for the management, operation and supervision of the tennis center, CONTRACTOR shall receive, and is authorized to withdraw from the account described in Section 6.1 below, all gross revenues less and except only the sums due to CITY under Section 5.1 above. ARTICLE 6. FINANCES §6.1 Deposit of revenues. All revenues from the operation of the tennis center shall be deposited daily into an account established for that purpose. §6.2 Fees and charges. (a) Fees to be charged for tennis activities at the tennis center will be determined each year during the budget process. CITY and CONTRACTOR agree that fees should be sufficient to pay operating expenses, but also be competitive with fees at other public tennis centers in the region. (b) Court usage fees, and membership or patron facility card fees, if used, must be approved by CITY. Prices charged for lessons, drills, camps, services, food, beverages, and merchandise shall be determined by CONTRACTOR. All patrons of the tennis center shall be charged according to a published schedule of fees and charges, and any complementary food, merchandise, or services shall be documented. (c) Neither CONTRACTOR nor CONTRACTOR's employees agents or sub- contractors shall waive any court usage fees which would lessen the gross revenue that would otherwise be derived from the operation of the Tennis Center, ex cept +Riess —with the rp for written consent of the Director of Community Services. §6.3 City's payment of certain expenses. CITY shall be responsible for physical , - Comment [TGS3]: It is my understanding that we are agreeing that we will not have any right maintenance of, and pay for, all necessary repairs to the actual physical conditions of the tennis to offset or reimbursement for any charges or expenses incurred by the City for repair or center, including ithout limitation, the tennis courts, light p oles, exterior of the tennis p ro shop g g p p p Contractor. In ot the amounts pay all Contractor. In other words, we pay for all (including all structural aspects such as the foundation, walls, roof, etc.), lawns, parking, sidewalks upkeep, and they pay for none. If this is not the case, this needs to be modified. seating, landscaping and plumbing, electrical, heating, ventilating and air conditioning, and natural gas systems and fixtures. CITY agrees to maintain such facilities in a good and operational condition in keeping with the standards of comparable tennis centers in the region as defined in this Agreement. CITY shall also perform court repair, resurfacing, and /or necessary replacement of nets, windscreens, and lights due to ordinary wear and tear. While CITY-94 shall have no responsibility for maintenance or repairs until and unless the CONTRACTOR first notifies CITY in writing of the specific need for repair. All other maintenance responsibilities shall be CONTRACTOR's responsibility. CONTRACTOR will notify CITY when, in the opinion of CONTRACTOR, that any of the facilities maintained by CITY requires maintenance. If however, the parties disagree about the condition and /or required maintenance of the CITY - maintained facilities, CONTRACTOR will notify CITY in writing of the reasons behind CONTRACTOR'S request. CITY will undertake reasonable efforts to respond to CONTRACTOR in writing within ten (10) business days of receipt of CONTRACTOR'S written request. I'+ +ho naF,o6 , „+ r Gh �+ n +ho ,, n +o��n o „f Comment [TGS4]: This is unnecessary since under Paragraph 9.7, either party can cancel on 90 days notice at any time without reason. §6.4 Contractor's responsibility for furnishings and equipment. CONTRACTOR shall provide all necessary equipment and furnishings for the operation of the tennis center, including, but not limited to, office furniture and supplies, pro shop inventory and display racks, racquet stringing equipment, ball machines, etc. §6.5 Facility improvements. Any improvements or modifications to the tennis center that are of a permanent nature or installed as fixtures to the tennis center, shall become the property of the CITY. CITY approval is required prior to any modifications or improvements to the tennis center. §6.6 Annual operating budget. (a) CONTRACTOR shall submit proposed budget considerations to the Director of Community Services by April 1 of each year for review of potential impact to the City's operating budget and capital improvements budget. ARTICLE 7. ACCOUNTING, REPORTS, AND AUDITS §7.1 Accounting records. CONTRACTOR shall maintain efficient and accurate accounting records in accordance with generally accepted accounting principles in a format consistent with other public tennis centers. §7.2 reports. (a) CONTRACTOR shall prepare daily and weekly reports showing the amounts, total and types of revenues collected at the Tennis Center. (b) On or before the 10th day of each month, CONTRACTOR shall submit to CITY a financial statement showing in detail the gross revenues and operating expenses of the preceding month and the fiscal year to date., including the weekly reports for the preceding month as required by 7.2(a) above. §7.3 Annual financial review. Within 90 days after the close of each fiscal year of the CITY, CONTRACTOR shall submit to CITY a financial review certified by CONTRACTOR, covering the specific financial condition and performance of the tennis center. The financial review must span the fiscal year then ended. CITY reserves the right to require a full audit, certified by a certified public accountant, should there be reason to believe an audit is warranted. If the report does not contain an "unqualified opinion," CITY may take such steps as it determines are necessary to obtain an unqualified opinion. CITY may terminate this Agreement if CONTRACTOR fails to provide an unqualified opinion within 120 days of the end of a fiscal year. §7.4 CITY'S right to inspect and audit. CITY has the right to inspect the books, records, invoices, deposits, sales slips, canceled checks, and other financial data or transactions of CONTRACTOR's operation of the tennis center at reasonable times during normal business hours. CITY also has the right to select an independent accounting firm to inspect or audit the books and records of the operation of the tennis center. §7.5 Location of records. CONTRACTOR shall keep all tennis center records on -site at the tennis center or at home office and periodically relocate them to the CITY'S off -site records storage facility. §7.6 Fiduciary relationship. CONTRACTOR has a fiduciary duty to CITY in all of CONTRACTOR'S financial obligations to CITY in accordance with this Agreement, including, but not limited to, faithfully accounting, depositing, and reporting all payments hereunder. ARTICLE 8. INDEMNITY AND INSURANCE §8.1 Indemnity By Contractor. CONTRACTOR ASSUMES ALL LIABILITY AND RESPONSIBILITY FOR AND AGREES TO FULLY INDEMNIFY, HOLD HARMLESS AND DEFEND CITY AND ITS OFFICERS, AGENTS, SERVANTS AND EMPLOYEES FROM AND AGAINST ALL CLAIMS, DAMAGES, LOSSES AND EXPENSES, INCLUDING BUT NOT LIMITED TO ATTORNEY'S FEES, FOR INJURY TO OR DEATH OF A PERSON OR DAMAGE TO PROPERTY, ARISING OUT OF OR IN CONNECTION WITH, DIRECTLY OR INDIRECTLY, THE OPERATION OF THE TENNIS CENTER, AND THE PERFORMANCE, ATTEMPTED PERFORMANCE OR NONPERFORMANCE OF THE WORK AND SERVICES DESCRIBED HEREUNDER OR IN ANY WAY RESULTING FROM OR ARISING OUT OF THE MANAGEMENT, SUPERVISION, AND OPERATION OF THE TENNIS CENTER UNDER THIS AGREEMENT, INCLUDING THE WORK, SERVICES, OPERATIONS AND LEGAL DUTIES OF CONTRACTOR, HIS OFFICERS, AGENTS, SERVANTS, EMPLOYEES, SUBCONTRACTORS, OR LICENSEES, IF ANY REGARDLESS OF WHETHER USCH INJURY, DEATH, OR DAMAGE IS CAUSED IN PART BY THE CITY'S NEGLIGENCE IN T HE EV ENT OF JOINT UK) GOINIG IRRING DESDfIA�CIRILITVO ONTRA(`TOR AND GITV RESPC)NISIRII ITT ) INDEMNITY IF ANY SHALL _RE= APPORTIONED COMPARATIVELY IN AG_C0Rr)aNICF IA /ITI -I TEXAAS ,I AW NO PROVISION OF THIS AGREEMENT SHALL BE CONSTRUED AS WIT,- .- ,- TH01I�I IT WAIVING ANY DEFENSE OF THE PARTIES UNDER TEXAS LAW INCLUDING THE DEFENSE OF GOVERNMENTAL IMMUNITY FROM SUIT OR LIABILITY THE PROVISIONS OF THIS PARAGRAPH ARE SOLELY FOR THE BENEFIT OF THE PARTIES HERETO AND ARE NOT INTENDED TO CREATE OR GRANT ANY RIGHTS, CONTRACTUAL OR OTHERWISE, TO ANY OTHER PERSON OR ENTITY. §8.2 Insurance. (a) CONTRACTOR shall obtain public liability insurance of the types and in the amounts set forth below from an underwriter licensed to do business in the State of Texas. CONTRACTOR shall furnish to CITY certificates of insurance or copies of the policies, evidencing the required insurance on or before the beginning date of this Agreement. CONTRACTOR agrees to submit new certificates or policies to CITY at least 30 days before the expiration date of the previous certificates or policies. The insurance shall be the following types in amounts not less than the indicated amounts: (1) Worker's Compensation and Statutory Employer's Liability or acceptable alternative. (2) Comprehensive General (Public) Bodily injury: Liability (or its equivalent), including $ 500,000 each person but not limited to the following: $1,000,000 each occurrence (i) premises /operations and (ii) independent contractors Property damage: (iii) personal injury $ 250,000 per occurrence (iv) products /completed operations or $1,000,000 combined single limit for bodily injury and property damage. (3) Property insurance for physical Coverage for minimum of damage to the property of 100% of the fair market value CONTRACTOR located at the of the property. Tennis Center. (4) Automobile liability, including Bodily injury: coverage for the following: $ 500,000 each person $1,000,000 each occurrence (i) owned /leased automobiles and (ii) non -owned automobiles Property damage: (iii) hired cars $ 250,000 per occurrence $1,000,000 combined single limit for bodily injury and property damage. (b) On all insurance required in Subsections (a) and (b), CONTRACTOR shall require that the insurance provider: (1) name CITY its officers and employees as an additional insured; (2) provide a waiver of subrogation in favor of CITY; and (3) provide that the issuing insurance company provide 30 days' rp for written notice to CITY of any material change to or cancellation of the insurance. M:i9 Is] MM 9:1081ILIUVA QL1I §9.1 For default. CITY may terminate this Agreement in accordance with this article for a default by CONTRACTOR. §9.2 What constitutes a default. The following events constitute a default by CONTRACTOR: (a) a breach of the fiduciary obligations of CONTRACTOR under Sections 5.1, 5.2, and 7.6 of this Agreement; (b) filing by CONTRACTOR of a voluntary petition for protection under federal bankruptcy laws, or the failure to obtain the dismissal of an involuntary petition under federal bankruptcy laws within 30 days after filing; (c) a discontinuance by CONTRACTOR of its business or abandonment of its activities at the tennis center; (d) the inability of CONTRACTOR to provide an unqualified opinion in the annual audit report in accordance with article 7; or (e) a failure of CONTRACTOR to perform his duties under this Agreement. (f) The commission by CONTRACTOR or any of CONTRACTOR's employees of a felony or crime of moral turpitude if the CITY, in its sole discretion, reasonably believes that CONTRACTOR or CONTRACTOR's employee committed the act (regardless of whether convicted) and that the act suggests that the employee constitutes a threat to the users of the Tennis Center or the public at large, or that the act could, on becoming public knowledge, impair the public's confidence or trust in the CITY or CONTRACTOR or the personnel at the tennis center or in the operation of city government in general. §9.3 Correction. CONTRACTOR shall have 30 days after written notice from CITY specifying the nature of a default under Section 9.2(e) or Section 9.2(f) because of the commission of an offense by an employee of CONTRACTOR, to correct the default (including without limitation, terminating the employment of an employee who causes a default of the agreement under Section 9.2(f) by committing a felony or crime of moral turpitude) provided that this provision shall not apply unless CONTRACTOR shall immediately place such employee on leave or re- assign such employee to another location If the default is of such a nature that it cannot reasonably be corrected within 30 days, the CITY may grant CONTRACTOR °"^" have additional time as may be reasonably necessary to correct the default so long as CONTRACTOR diligently pursues the correction and takes all reasonable measures to insure the safety of the public and fulfillment of CONTRACTOR'S other obliaations hereunder. §9.4 Election to terminate. CITY may elect to terminate this Agreement pursuant to this article by giving written notice of default to CONTRACTOR. If the default is under Section 9.2(a), (b), (c), or (d), or is under Section 9.2(f) because of the commission of an offense by CONTRACTOR, this agreement shall terminate immediately upon delivery of written notice from CITY to CONTRACTOR of its election to terminate the agreement. If the default is under Section 9.2(e) or is under Section 9.2(f) because of the commission of an offense by an employee of CONTRACTOR, this Agreement shall terminate upon expiration of the correction period if correction has not been made pursuant to Section 9.3, and CITY delivers to CONTRACTOR notice of its election to terminate the Agreement. §9.5 Remedy for certain defaults. If CONTRACTOR defaults under Section 9.2(a), CONTRACTOR shall pay all amounts due CITY at the time of its default under the terms of this Agreement and in addition, pay all costs, damages, expenses, and reasonable attorneys' fees incurred by CITY as a result of the default and in pursuing its remedy. §9.6 Lien. CITY has, at all times, a valid security interest to secure payment of all fees and other sums of money becoming due under this Agreement from CONTRACTOR and to secure payment of any damages or loss that CITY may suffer by reason of CONTRACTOR'S breaching any covenant, agreement, or condition contained in this Agreement. The security interest covers all goods, wares, equipment, fixtures, furniture, and other personal property of CONTRACTOR that is now on the Property or placed on the Property at some later date, and all proceeds attributable to#e444 them. This property may not be removed from the premises without CITY'S consent until all arrearages in fees and all other sums of money then due the CITY under this Agreement have been paid and discharged, and all the covenants, agreements, and conditions of this lease have been fully complied with and performed by CONTRACTOR. If CONTRACTOR is in default, CITY may, in addition to any other remedies provided in this Agreement or by law, after giving reasonable notice of the intent to take possession and giving an opportunity for a hearing on the issue, enter on the Property and take possession of any goods, wares, equipment, fixtures, furniture, and other personal property of CONTRACTOR situated on the premises, without liability for trespass or conversion, and sell the property at public or private sale, with or without having the property at the sale, after giving CONTRACTOR reasonable notice of the time and place of any public sale or of the time after which any private sale is to be made. CITY or its assigns may buy any items to be sold at such a sale unless they are prohibited from doing so by law. Unless otherwise provided by law, and without excluding any other manner of giving CONTRACTOR reasonable notice, the reasonable notice requirement is met if notice is given at least ten (10) days before the time of sale. The proceeds from any such disposition, less any expenses connected with taking possession, holding, and selling the property (including reasonable attorney's fees and other expenses), will be applied as a credit against the indebtedness secured by the security interest granted in this section. Any surplus will be paid to CONTRACTOR or as otherwise required by law, and CONTRACTOR will pay any deficiencies immediately. When City requests, CONTRACTOR will execute and deliver to CITY a financing statement in sufficient form to perfect CITY =s security interest in the property and proceeds under the provisions of the Business and Commerce Code in force in Texas. §9.7 Other termination. Regardless of the other provisions of this Agreement, e €ither party may terminate this Agreement upon a minimum of ninety (90) days written notice to the other party. The City Council shall approve City's termination of the Agreement pursuant to this section. ARTICLE 10. ASSIGNMENT AND DELEGATION Neither party shall assign or delegate this agreement without the prior written consent of the other party. ARTICLE 11. NOTICES All notices to the parties shall be in writing and shall be sent by certified mail, return receipt requested, to the addressees and addresses specified below: All notices to CONTRACTOR shall be sent to: Roxy Tennis, LLC c/o Stephen Poorman, member 220 Canyon Lake Drive Southlake. Texas 76092 All notices to CITY shall be sent to: City Manager City of Southlake 1400 Main Street, Suite 460 Southlake, Texas 76092 ARTICLE 12. MISCELLANEOUS §12.1 Non - Waiver. This Agreement shall not be construed against the drafting party. §1.2 After„ epsFees if CITY rnniTRACTnIR iG a PFeV@i1iRg @r +„ O R @Ry legal § 12.32 No Waiver. No waiver of any breach of any term or condition of this Agreement shall be construed to waive any subsequent breach of the same or any other term or condition of this Agreement. If any provision of this Agreement is held to be invalid or unenforceable as applied in a particular case for any reason, those circumstances shall not have the effect of rendering the provision invalid or unenforceable in any other case. The invalidity of one or more phrases, sentences, clauses, or sections in this Agreement shall not affect the remaining portions of the Agreement. /i1:4 VQ El WrZi]LT/ x:1011010 WAVA This Agreement shall be governed by and construed under the laws of the State of Texas, and venue in any proceeding relating to this Agreement shall be in Tarrant County, Texas. 0:49[Q 6 ,M:11►11111 V:FiTCj V A:11 8 1:1►Nr This agreement constitutes the entire agreement between the parties and neither of the parties shall be bound by any promises, representations or agreements except as expressly set forth in this Agreement. ARTICLE 16. BINDING CLAUSE This Agreement shall be binding upon the parties, their heirs, executors, administrators, devisees, legatees, trustees, successors, and assigns. EXECUTED this day of , 20052 CITY OF SOUTHLAKE, TEXAS By: Mayor WIVIIIIIIIIIIIr091 City Secretary we] aI12 - 11 Eel V Stephen Poorman Mia Gordon - Poorman