Operating Agreement This Agreement
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OPERATING AGREEMENT THIS AGREEMENT made as of this ______ day of January, 2015 between the CITY OF AUBURN , Cayuga County, New York (the "City") and AUBURN COMMUNITY NON- PROFIT BASEBALL ASSOCIATION, INC ., a New York State not-for-profit cooperation ("ACB"). WHEREAS the City owns the Auburn Doubledays Baseball Team ("the Doubledays") and Falcon Park Baseball Stadium ("Falcon Park"); and WHEREAS the City desires to retain ACB as its agent to manage and operate the Doubledays and Falcon Park and to sell merchandise in Falcon Park bearing the Auburn Doubleday's name or trademark; and WHEREAS the City and ACB acknowledge that Falcon Park is a multi-use facility to be utilized for not only professional baseball, but for other activities appropriate for the structure/facility. NOW, THEREFORE , in consideration of the terms and conditions herein set forth, the parties agree as follows: 1. Employment of ACB as the City's Agent: The City hereby employs ACB as its agent for the management and operation of Falcon Park and the Doubledays with the exclusive authority, subject to the limitations and conditions herein set forth, to direct, supervise and manage the operation of the Doubledays and Falcon Park, and to sell merchandise bearing the Doubledays' name or trademark (hereinafter, "Doubledays Merchandise"). All trademarks shall be registered in the name of the City and the City shall cooperate with ACB in filing all of the applications and other materials required to obtain trademarks or other intellectual property rights for Doubledays Merchandise to be sold by ACB. The parties acknowledge that the City will become owner of the assets on Attachment A upon the execution of this contract, the City shall allow ACB to use said assets in the presentation of games and events at Falcon Park. 2. Management of the Doubledays: ACB shall have full and exclusive responsibility for all operations of the Doubledays. ACB shall hire the general manager of the Doubledays and all employees, shall attend meetings of the New York-Pennsylvania Professional League, Inc. as the City's representative and, in general, shall do and perform all acts and things incident to the management and control of a baseball team: ACB shall adhere to all terms and conditions of the Player Development Contract with its Major League Baseball affiliates (currently the Washington Nationals) and shall abide by the constitution and by-laws of the New York- Pennsylvania Professional Baseball League, applicable rules and regulations of the National Association of Professional Baseball Leagues, and the Professional Baseball Agreement between the National League and American League of Professional Baseball Clubs and the National Association of Professional Baseball Leagues, as amended from time to time. 3. Management of Falcon Park: (a) ACB shall have full and exclusive responsibility for the operation of Falcon Park, including but not limited to ticket sales, concessions, sales of Doubledays Merchandise, food service, promotions, and any special events at Falcon Park. (b) ACB's responsibilities shall include the following: (1) Custodial maintenance and cleaning of Falcon Park facilities including grounds surrounding the facility, including painting and maintenance of outfield fence signs. (2) Any and all minor repairs to the playing field and structures at Falcon Park (minor repair being defined as a repair costing $1,000 or less). (c) The City's responsibility shall include the following: (1) Maintenance of the playing field and structures at Falcon Park. (2) Any and all major repairs to the playing field and structures at Falcon Park (major repairs being defined as repairs costing in excess of $1,000) and also replacement of outfield fence signs as needed. (3) Refuse removal. (4) Payment of any and all utilities. (5) Major equipment purchases. (d) ACB shall make no permanent physical changes to Falcon Park without the City's prior written approval. (e) ACB may appoint agents or independent contractors to carry out its responsibilities hereunder. (f) ACB shall notify the City Manager on or before February 15th of each calendar year of any expenditure known to ACB that may be the City's responsibility pursuant to section 3(c) of this Agreement. (g) The City retains the right to use Falcon Park for activities deemed acceptable and appropriate by the City Manager, provided that said use will not conflict with activities previously scheduled by ACB. 4. Annual Budget: ACB shall prepare an annual budget estimate of revenues and expenses and, upon approval by ACB's Board of Directors, shall submit this budget to the City Manager on or before September 15th for the following fiscal year. This budget shall include 2 estimates of revenues and expenses related to (1) operation of Falcon Park (including revenue from sale of advertising); (2) management of the Doubledays; and (3) promotion and sale of Doubledays Merchandise. ACB's Board of Directors and its President shall report to the City Council as requested to review ACB's budget or corporate activities. 5. Budget Review (i) The Treasurer of ACB shall prepare an annual budget estimate by September 15 th of each year and submit it to the City for review. (ii) In the event budgeted operating expenses exceed estimated revenues, the City Council shall, in November prior to the budget year in question, review and approve ACB's budget estimate of revenues and expenses submitted to the City Manager, and shall appropriate funds to provide a subsidy equal to the differences between the estimate of revenues and the estimate of expenses. In such case ACB may appear before the City Council or other applicable committee to answer questions regarding the budget and ACB's performance of its duties and responsibilities pursuant to this Agreement. (iii) ACB shall not incur operating expenses during a calendar year greater than the sum of the revenue estimate contained in its annual budget plus any subsidy appropriated by the City Council under the preceding Section 5.0l(ii) without approval of the City Council. In the event ACB's actual calendar year revenues are greater than actual expenses and startup costs for the following year (which excess is hereinafter referred to as "Surplus Revenues"), ACB shall remit the Surplus Revenues to the City in the following year in accordance with ACB's current budget. Any Surplus Funds not previously remitted to the City shall be paid by ACB to the City within sixty (60) days of the termination of this Agreement. (iv) In any calendar year in which a subsidy to ACB is required under Section 5.0I(ii) hereof, the City Comptroller shall establish, prior to the commencement of the calendar year in consultation with ACB, a schedule of installment payments by the City to ACB for the next following calendar year. Said amounts shall be based upon projected estimates of ACB's cash needs for the calendar year. 6. Deposit of Revenues and Payment of Expenses: All monies collected by ACB from the operation of the Doubledays and Falcon Park, including revenues from ACB's sales of Doubledays Merchandise, shall be deposited in total not less often than once a week in accounts in the name of ACB. From such account ACB may pay or reimburse itself for obligations and expenditures necessarily and properly incurred for and on account of the City in connection with the management and operation of the Doubledays and Falcon Park. All ACB management employees handling monies collected by ACB shall be covered by fidelity bonds satisfactory to the City Comptroller. 7. Chattel Asset Inventory and Acquisition By The City: (a) The parties have conducted an inventory of all chattels and items of personalty present at Falcon Park and necessary for the presentation of baseball games and other 3 events. The City hereby acquires title and ownership to all of the items listed on annexed Attachment A. The consideration for this acquisition and the ownership of these items titled in the name of the City shall be the agreed sum of $93,750. The parties agree that ACB presently owes the City a loan balance principle in the amount of $93,750. The aforesaid $93,750 consideration for the acquisition of said personalty and chattels shall be a credit of $93,750 against the said loan, bringing the present balance owed by ACB to the City the amount of $0.00 dollars, thereby satisfying the debt/loan in full. (b) The following two groups of chattels are owned by ACB and shall remain owned by ACB. i) Baseball uniforms (jerseys, pants, hats, belts and socks) for the team players purchased for about $10,000 when new. ii) All souvenirs and such merchandise purchased for re-sale to the public, purchased by ACB for $9,979.36 new for the 2014 season. (c) One of the assets acquired by the City hereunder is a certain tractor which was financed by ACB through M&T Bank. There remains indebtedness on the tractor loan of $8,843.88 presently. In consideration of the fact that the tractor is used exclusively to mow the infield, outfield and foul ball areas beyond the first and third bases and field lines, and is not used for any mowing or work anywhere else at Falcon Park or within the City (the rationale for which is that the parties do not wish for weeds, weed seeds or crabgrass trimmings to be co-mingled with the manicured baseball playing field grass at Falcon Park). Therefore, ACB agrees to continue making payments due to M&T Bank on the aforesaid tractor during the life of the loan. (d) Also annexed hereto is Attachment B prepared by the parties for references sake to assist in the determination of the values of the assets acquired by the City.