2003/04/09 Council Agenda Packet

- -- reconciliation of the calculation of the Variable Fee by the third (3rd)business day of each month. i. Diversion Clause. It is the intention of the parties hereto that the percentage payments herein mentioned are payable out of the business revenue that BCG intends to collect from operation of the Facility. That said business is the principal business in which BCG is engaged with the City, and BCG covenants and agrees to conduct said principal business upon or from said Facility during the Term and not to divert it there from by any device whatsoever which will effect a diminution of the percentage payments herein stipulated. BCG further agrees, during its normal business hours during the Term, to conduct a business in the Facility and to keep same reasonably stocked with merchandise consistent with the provisions of this Agreement. C. Concessionaire shall receive a total of four-hundred (400) courtesy rounds of golf each year. These rounds may be used only for reciprocal privileges for Concessionaire's employees, members of the Golf Superintendents Association, and visiting professionals. Rounds must be accounted through the cash receipt procedures prescribed by the Park Director and outlined in the City's Internal Control Manual. These courtesy rounds are limited to weekdays at non-peak hours and shall not exceed eight (8) rounds on any day. Greens fees shall be paid for additional rounds in accordance with the approved Fee Schedule. The Golf Course Manager and Golf Pro staff may be allowed use of courtesy rounds for weekend play. Permission to exceed the eight (8) rounds per day or four-hundred round (400)per year limit may be granted by the Park's Director provided a written request is submitted not less than seven (7) days in advance of the expected usage to the Park Director or his designee for approval. Separate consideration for Pro-Am and Super-Am events must also be submitted in writing for approval by the Park Director or his designee. If approved, rounds played for Pro-Am and Super-Am will not be counted against Concessionaire's compensation total rounds. D. IRS Private Activity Rules. The parties undertake this Agreement with the understanding that it is the City's intent to operate within the private activity rules set forth in the Internal Revenue Code. The Business arrangements in this Agreement are designed to maintain compliance with the Internal Revenue Code's private activity rules. In the event the business conditions upon which this Agreement are structured vary in such a manner that the fixed and/or variable fee structures in Section 7 of this Agreement become at risk of violating the private activity rules, both parties agree to negotiate appropriate modifications to the Agreement in order to maintain compliance. 8. INSURANCE: BCG shall, via its obligation to maintain insurance coverage as set forth herein, fully protect the City from any and all claims and risks in connection with its activity upon or use or occupation of the Facility, as well as any and all claims and risks in connection with any activity performed by BCG by virtue of the rights granted 12