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HomeMy WebLinkAboutResolution - 4613 - Agreement - CTBL Inc - Convention & Tourism Services - 09/22/1994Resolution No. 4613 Item No. 20 City Council Date 09/22/94 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute for and on behalf of the City of Lubbock a Convention and Tourism Service Agreement by and between the City of Lubbock and the Convention and Tourism Bureau of Lubbock, Inc., attached hereto, which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this ATTEST: �' " C -'L Betty M. John City Secretary APPROVED AS TO CONTENT: Robert Massengale, Assistant C.Ay Manager APPROVED AS TO FORM: G. Vandiver, Alrst Assistant City nGV:da/codocs/convtour.res September 12, 1994 Resolution No. 4613 Item #20 September 22, 1994 CONVENTION AND TOURISM SERVICE AGREEMENT THIS AGREEMENT (the "Agreement") is entered into between the CITY OF LUBBOCK, TEXAS, a municipal corporation ("City") and THE CONVENTION AND TOURISM BUREAU OF LUBBOCK, INC., a Texas not-for-profit corporation (the 'Bureau"). PREAMBLE Pursuant to the terms of Chapter 351, Tax Code, City has elected to impose a hotel occupancy tax (the "Hotel Tax") on persons occupying hotel rooms in the City. As authorized by law, City has allocated a portion of the revenues generated by the Hotel Tax for purposes of advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the City or its vicinity. Bureau has been organized to establish and operate a convention and tourism service to promote tourism and the convention industry, to increase hotel occupancy and to encourage the use of the Memorial Civic Center and Auditorium -Coliseum as well as other similar facilities in the City. Pursuant to the authority granted in Section 351.101(c), Tax Code, City desires to delegate to Bureau the management and supervision of programs and activities funded with revenue from the Hotel Tax, and Bureau desires to accept such delegation. AGREEMENT In consideration of the recitals contained in the Preamble, City and Bureau agree as follows: ARTICLE I PROGRAMS AND ACTIVITIES: TERM 1.01. Delegation. City hereby delegates to Bureau, and Bureau hereby accepts, responsibility for creating, managing, operating and supervising programs and activities Convention and Tourism Service Agreement Page I for the purpose of advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the City or its vicinity, the programs and activities to be conducted by Bureau to include, without limitation, the following: (a) Preparing proposals and presentations to meeting planners, convention delegates and other groups desiring to hold conventions within the City; (b) Preparing and distributing materials for the purpose of promoting tourism and conventions in the City and promoting the local hotel industry in general; (c) Making personnel available for tourists and convention delegates desiring to hold conventions within the City and providing other auxiliary services to such persons during their stay in the City; (d) Coordinating the activities of tourists and convention delegates during their stay in the City; (e) Providing support services to delegates and registrants at conventions within the City, including, but not limited to, arranging receptions, arranging social functions, arranging transportation to and from hotels and the airport, and arranging hotel accommodations; and, (f) Assessing promotional and service activities and market trends in the tourism and convention industry in order to maximize the effectiveness of programs and activities undertaken by Bureau. 1.02. Prior Agreement. City and Bureau recognize that prior to the effective date of this Agreement, City delegated certain convention and tourism responsibilities to the LUBBOCK CHAMBER OF COMMERCE (the "Chamber") pursuant to the terms of a contract dated June 14, 1979 (the "Prior Agreement"), which was amended on September 10, 1981, February 23, 1984, and March 22, 1984. The Prior Agreement and the delegation contained therein have been terminated and City has received or may receive from the Chamber certain assets used by the Chamber in providing convention and tourism services pursuant to the Prior Agreement. City Agrees that to the extent any such Convention and Tourism Service Agreement Page 2 assets have been or are hereafter received by City, City immediately shall transfer such assets to Bureau for use by Bureau in conducting its programs and activities hereunder. 1.03. Governmental Requirements. Bureau shall conduct its programs and activities in accordance with all applicable laws, rules, statutes and regulations of federal, state and local governments, including, without limitation, the provisions of Chapter 351, Tax Code, as the same now exist or hereafter may be enacted and/or amended. 1.04. Term. This Agreement shall be for a term of five (5) years, beginning October 1, 1994 and ending September 30, 1999; provided, however, that there automatically shall be added to such term a one-year extension after the initial term if neither City nor Bureau gives written notice to the other party on or before April 1, 1999, or any subsequent April 1st of its intent to terminate this Agreement at the end of its then - current term. ARTICLE II FISCAL MATTERS 2.01. Funding. City agrees to provide funding for the programs and activities conducted by Bureau pursuant to the terms of this Agreement by paying to Bureau a portion of the revenues derived from City's imposition and collection of the Hotel Tax. Such funding shall consist of (i) that portion of the Hotel Tax revenues allocated to "convention and tourism activities" under the provisions of Section 26-22, Code of Ordinances of the City of Lubbock, Texas, as the same may hereafter be amended, and (ii) funding from such other sources as may be approved by City. Bureau acknowledges that the funding of its activities by City with Hotel Tax revenues creates and establishes a fiduciary duty on the part of Bureau with respect to such funds. 2.02. Revenue Estimates. On or before April 1 of each year during the term of this Agreement, City shall estimate the amount of Hotel Tax revenue which will be collected and paid to Bureau during Bureau's next fiscal year, and shall provide written Cmvmwn and Tourism Service Agreement Page 3 notice of that estimate to Bureau. Bureau's proposed budget for its next fiscal year shall reflect the revenue estimate so provided by City. As soon as reasonably possible following the end of each fiscal year and City's completion of its annual financial audit, City shall determine the actual amount of Hotel Tax revenue collected by City and allocated herein to the funding of Bureau's programs and services during the preceding fiscal year and shall provide written notice of such amount to Bureau. In the event the actual amount of such Hotel Tax revenue which is allocated to Bureau's programs and activities hereunder shall be either more or less than the actual amount of such revenue paid to Bureau with respect to such fiscal year, appropriate adjustments promptly shall be made in Bureau's budget for its current fiscal year in order to reduce its budgeted expenditures by an amount equal to any deficiency or to increase its budgeted expenditures by the amount of any excess. 2.03. Bud ets. Bureau shall prepare and submit to City a detailed annual budget in a form acceptable to City. City and Bureau contemplate that the budget shall be submitted in a form substantially identical to the form used by City's departments in its internal budgeting process, provided that such form may be varied by agreement of City and Bureau. Bureau's initial budget for fiscal year October 1, 1994 -September 30, 1995 has been submitted to and approved by City simultaneously with City's approval of this Agreement. Each subsequent budget shall be submitted to City no later than the April 30 immediately preceding the fiscal year to which such budget relates. Upon receipt of Bureau's proposed budget, City shall review such budget and promptly notify Bureau of any changes and/or supplements to the proposed budget that the City believes are necessary. City and Bureau agree to work with one another and cooperate in good faith to address any such changes and/or supplements to the proposed budget. Following completion of any revisions to the proposed budget, City shall submit the proposed budget to the City Council for review and approval by the City Council in accordance with Chapter 102, Local Government Code, and Chapter 1, Article X, Paragraph 4, Lubbock Convention and Tourism Service Agreement Page 4 City Charter. The City's final approval of the budget, including any further revisions thereto which may be required by the City Council, shall be in writing, and no expenditures or obligations described in the budget shall be incurred by Bureau until final written approval of City has been obtained. City shall be responsible for holding any public hearings on the proposed budget which may be required by applicable law or regulation. 2.04. Payment. (a) Payment. All funds payable to Bureau with respect to any fiscal year shall be paid in four (4) equal quarterly installments, on October 1, January 1, April 1 and June 1 of each fiscal year, beginning October 1, 1994. Upon receipt of such funds, Bureau shall deposit the same in a separate account established by Bureau for that purpose at a federally -insured state or national bank or other savings institution in Lubbock, Texas. At Bureau's option, such account may be an interest-bearing account, in which case all interest accrued thereon shall be used by Bureau only for the purposes described in this Agreement in accordance with the terms of a budget approved by City. (b) Unexpended Funds. To the extent any unexpended funds shall remain at the end of a fiscal year, such unexpended funds are reappropriated to Bureau for use during the following fiscal year. Unless such unexpended funds already have been included in the approved budget for the following fiscal year or City and Bureau otherwise agree, Bureau shall determine the budget account or accounts in which such excess funds remain and the excess funds shall be added to the same account or accounts in the Mowing budget in the same proportion. 2.05. Expenditures. Revenues received by Bureau under the terms of this Agreement may be spent for day-to-day operations of the Bureau, supplies, salaries, office rental, travel expenses and other administrative costs, provided that no such revenues may be spent for travel for a person to attend an event or conduct an activity the primary purpose of which is not directly related to the promotion of tourism and the convention and hotel industry or the performance of the person's job in an efficient and professional Convention aui Tourism Service Agreement Page 5 manner. Bureau shall not make any expenditures using funds provided hereunder unless such expenditures are incurred pursuant to the terms of a budget approved by City as provided in this Agreement. Anything contained elsewhere in this Agreement to the contrary notwithstanding, Bureau shall have the authority to reallocate up to 10% of any budget funds to any other budget account or accounts included in the budget without first securing City's approval. 2.06. Financial Reuorting. Bureau shall maintain complete and accurate financial records of each expenditure of funds provided by City pursuant to the terms of this Agreement. All financial records of Bureau shall be maintained on an accrual basis, in accordance with generally accepted accounting principles consistently applied. Within thirty (30) days following the end of each fiscal quarter, Bureau shall provide to City a written financial statement for such quarter showing all revenues received by Bureau from City with respect to such quarter and listing all expenditures of the Bureau during such fiscal quarter in carrying out its programs and services under this Agreement. Bureau agrees to make all of its financial records available to City and, to the extent required by law, to other persons, provided that any inspection or review of Bureau's financial records shall be conducted only during Bureau's normal business hours at its offices. City, at its option, shall be entitled to have an audit of Bureau's financial records conducted by an auditor of City's choosing. Additionally, City is aware of the fact that Bureau shall have a complete audit of its financial affairs conducted following the end of each fiscal year by Bureau's independent auditor, and Bureau agrees to provide City with a copy of any audit report furnished to Bureau. 2.07. Fiscal Year. For purposes of this Agreement, Bureau's fiscal year shall begin on October 1 of each calendar year and shall end on September 30 of the following calendar year. Convention and Tourism Service Agreement Page 6 2.08. Other Revenue. Nothing contained in this Agreement shall prohibit Bureau from obtaining funding for its programs and activities from other sources, including charitable contributions and grants from private foundations and governmental organizations. All funds received by Bureau pursuant to the terms of this Agreement shall be maintained in a segregated account and shall not be commingled with any other funds belonging to Bureau. No funds paid to Bureau pursuant to this Agreement shall be used for any purpose other than the purposes stated in Section 1.01 and 2.05 of this Agreement and, to the extent the Bureau incurs expenditures in connection with the programs and activities described in Section 1.01 which also benefit other programs and activities conducted by Bureau, such expenditures shall be allocated equitably among the various funding sources available to Bureau based upon the relative benefits of such expenditures to the various programs and activities conducted by Bureau. ARTICLE III PERSONNEL 3.01. Personnel. Bureau shall set the qualifications for and shall hire any and all personnel Bureau deems necessary to discharge its responsibilities under the terms of this Agreement and shall have the authority to fix the compensation and other benefits payable to Bureau's employees. To the extent permitted by applicable law and provided City and Bureau agree, Bureau may make provision for participation by its directors, officers and employees in various benefit programs offered by City to its employees. Bureau, in carrying on its programs and activities hereunder, shall be acting solely as an independent contractor and not as an agent or employee of City. All employees of Bureau are employed solely by Bureau and do not constitute City employees. Bureau shall have the sole right and authority to direct the time, place and manner in which its employees perform the tasks for which they are hired, and shall be solely responsible for all income tax withholding, benefits, unemployment compensation payments and other expenses Convention and Tourism Service Agreement Page 7 associated with such employees. All contacts between City and Bureau personnel shall be coordinated through the President of Bureau's Board of Directors or such other person or persons as the Bureau's Board of Directors may designate. ARTICLE IV OFFICES 4.01. Existing Lease. By Lease Agreement dated July 28, 1994, City, as Lessee, leased from the LUBBOCK CHAMBER OF COMMERCE (the "Chamber"), as Lessor, certain premises (the "Premises") in the Chamber's office building located at 14th and Avenue K in the City of Lubbock, Lubbock County, Texas. The Lease provides that City, without the Chamber's consent, may assign its rights in the leased premises to Bureau. By execution of this Agreement, City hereby assigns the Lessee's interest in the Lease to Bureau, and Bureau accepts such assignment and assumes and agrees to perform all of the Lessee's obligations set forth therein, subject, however, to the following provisions: (a) City represents to Bureau that (i) City has not received any notice of default on its part under the terms of the Lease, nor is City aware of any circumstances which, with passage of time or giving of notice or both, would constitute a default on its part under the terms of the Lease Agreement, and (ii) City has no knowledge of any conditions in or about the Premises, including environmental conditions, which are hazardous or otherwise are recognized to present a threat to the health and safety of persons in and about the Premises. (b) City recognizes that annual rent is due under the Lease on October 1 of each year, beginning October 1, 1994, and that City and Bureau will be in default under the terms of the Lease if the annual rent is not paid by October 15 of each year, and City therefore agrees to use its best efforts to insure that the quarterly payment due to Bureau on October 1 of each year is paid to Bureau in a timely manner so that Bureau may pay the annual rent due under the Lease prior to October 15 of such year; (c) If the Lease shall terminate for any reason, whether by expiration of the term of the Lease or otherwise, City agrees to use its best efforts to assist Convention and Tourism Service Agreement Page 8 Bureau in locating replacement premises on terms no less favorable to Bureau than those contained in the Lease, including, without limitation, leasing Bureau space in City -owned facilities if it is available; (d) In the event City, for any reason, shall cease to provide funds to Bureau pursuant to the terms of this Agreement, Bureau immediately shall reassign the Lease to City and City shall accept such reassignment and assume and agree to perform all of the obligations of the Lessee under the terms of the Lease; (e) In the event either City or Bureau receives any notice or communication from Landlord alleging a default or other failure to perform on the part of the Lessee under the terms of the Lease, the party so receiving such notice or communication immediately shall provide a copy thereof to the other parry and City and Bureau shall cooperate with one another in reviewing and responding to such allegations; (f) Neither City nor Bureau shall agree to any amendment or modification of the terms of the Lease without the consent and joinder of the other. ARTICLE V TERMINATION 5.01. Termination. This Agreement may be terminated only by the non -renewal of its term as provided in Section 1.04, by the mutual agreement of City and Bureau or by default by either City or Bureau as provided in Section 5.02. 5.02. Default. Neither party shall be deemed to be in default under the terms of this Agreement unless and until it has received written notice from the other party specifically describing any failure on its part to perform its duties and obligations hereunder and does not cure such failure within ten (10) days following receipt of such written notice from the other party, provided, however, that in the event the nature of the failure is such that it reasonably cannot be cured within said ten-day period, no default shall occur hereunder so long as the party failing to perform commences to cure such failure within said ten-day period and thereafter diligently and in good faith prosecutes such cure to completion. Financial inability or delay shall not be deemed to be sufficient Convention and Tourism Service Agreement Page 9 cause to extend the cure period, unless any failure to perform by Bureau results from City's failure to timely pay to Bureau funds in the amounts and at the times provided elsewhere in this Agreement. 5.03. Remedies Upon Default. If an event of default shall occur under this Agreement, the non -defaulting party may terminate this Agreement upon written notice to the defaulting party and thereafter pursue such other remedies against the defaulting party as may be permitted by applicable law. Anything contained elsewhere in this Agreement to the contrary notwithstanding, however, no director, officer, employee or agent of either party to this Agreement shall be personally liable for any default by such party. 5.04. Procedure Upon Termination. If this Agreement shall terminate, whether by expiration of the term hereof or otherwise, Bureau, to the extent it may do so from available funds, promptly shall pay and discharge all outstanding liabilities incurred by Bureau during the term of this Agreement and thereafter shall pay and deliver to City all furniture, fixtures, equipment and other assets of Bureau which were purchased with funds provided by City hereunder and all unexpended funds provided by City which then are in Bureau's possession. All other assets of Bureau shall be disposed of in accordance with the provisions of Bureau's Articles of Incorporation and Bylaws. City shall assume and perform all outstanding contracts and obligations of Bureau to the extent such contracts and obligations may not be terminated by Bureau upon termination of this Agreement. ARTICLE VI MISCELLANEOUS 6.01. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof. Any modification or amendment of this Agreement shall be in writing and executed by both parties. Convention and Tourism Service Agreement Page 10 6.02. Applicable Law. This Agreement shall be construed and enforced in all respects in accordance with the laws of the State of Texas and the laws of the United States applicable to transactions in Texas. 6.03. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall, for all purposes, be deemed to be an original, and all such counterparts shall together constitute but one and the same agreement. 6.04. Severability. If any provision of this Agreement or the application thereof to any person or circumstances shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement or the application of such provision to persons or circumstances, other than those as to which it is determined invalid or unenforceable, shall not be affected thereby, and each provision of this Agreement shall be valid and shall be enforced to the fullest extent permitted by law. 6.05. Captions. The captions in this Agreement are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope of this Agreement or the scope or content of any of its provisions. 6.06. Notices. (a) Any notice, report, request or demand required, permitted or desired to be given under this Agreement (hereinafter collectively referred to as "Notices") shall be in writing and shall be deemed to have been properly given or served when mailed by registered or certified mail, return receipt requested or personally delivered to the respective party at the following addresses: If to Bureau: President Convention and Tourism Bureau of Lubbock, Inc. Convention and Tourism Service Agreement Page 11 If to City: City Manager City of Lubbock P. O. Box 2000 Lubbock, Texas 79457-0001 (b) Any addressee or name specified above may be changed by a Notice given by the addressee to the other parry in accordance with Section 6.07(a) above. (c) All Notices shall be deemed effective as of the date of mailing or on the date of personal delivery, as appropriate. Any Notice to be given by any party hereto may be given by counsel for such party. 6.07. Interpretation. Whenever herein the singular number is used, the same shall include the plural, and vice versa, and the masculine gender shall include the feminine and neuter genders, and vice versa, as the context shall require. The section headings used herein are for reference and convenience only and shall not enter into the interpretation hereof. 6.08. Time. Time is of the essence to this Agreement and the obligations of the parties hereunder; provided, however, that if any date specified herein for performance of any duty, obligation or responsibility shall fall on a Saturday, Sunday or legal holiday for national banks doing business in Texas, the time for such performance shall be extended until the next day which is not a Saturday, Sunday or legal holiday for national banks doing business in Texas. Convention and Tourism Service Agreement Page 12 EXECUTED AND EFFECTIVE this 22nd day of September, 1994. ATTEST: etty M. Johnson, Secretary ATTEST: LM Secretary DGV:da/c&tagree/CONVTOUR.doc September 8, 1994 BUREAU: THE CONVENTION AND TOURISM BUREAU OF LUBBOCK, INC. Convention and Tourism Service Agreement Page 13 Resolution No. 4613 Item # 20 September 22, 1994 CONVENTION AND TOURISM SERVICE AGREEMENT THIS AGREEMENT (the "Agreement") is entered into between the CITY OF LUBBOCK, TEXAS, a municipal corporation ("City") and THE CONVENTION AND TOURISM BUREAU OF LUBBOCK, INC., a Texas not-for-profit corporation (the 'Bureau"). PREAMBLE Pursuant to the terms of Chapter 351, Tax Code, City has elected to impose a hotel occupancy tax (the "Hotel Tax") on persons occupying hotel rooms in the City. As authorized by law, City has allocated a portion of the revenues generated by the Hotel Tax for purposes of advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the City or its vicinity. Bureau has been organized to establish and operate a convention and tourism service to promote tourism and the convention industry, to increase hotel occupancy and to encourage the use of the Memorial Civic Center and Auditorium -Coliseum as well as other similar facilities in the City. Pursuant to the authority granted in Section 351.101(c), Tax Code, City desires to delegate to Bureau the management and supervision of programs and activities funded with revenue from the Hotel Tax, and Bureau desires to accept such delegation. AGREEMENT In consideration of the recitals contained in the Preamble, City and Bureau agree as follows: ARTICLE I PROGRAMS AND ACTIVITIES: TERM 1.01. Delegation. City hereby delegates to Bureau, and Bureau hereby accepts, responsibility for creating, managing, operating and supervising programs and activities Convention and Tourism Service Agreement page 1 for the purpose of advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the City or its vicinity, the programs and activities to be conducted by Bureau to include, without limitation, the following: (a) Preparing proposals and presentations to meeting planners, convention delegates and other groups desiring to hold conventions within the City; (b) Preparing and distributing materials for the purpose of promoting tourism and conventions in the City and promoting the local hotel industry in general; (c) Making personnel available for tourists and convention delegates desiring to hold conventions within the City and providing other auxiliary services to such persons during their stay in the City; (d) Coordinating the activities of tourists and convention delegates during their stay in the City; (e) Providing support services to delegates and registrants at conventions within the City, including, but not limited to, arranging receptions, arranging social functions, arranging transportation to and from hotels and the airport, and arranging hotel accommodations; and, (f) Assessing promotional and service activities and market trends in the tourism and convention industry in order to maximize the effectiveness of programs and activities undertaken by Bureau. 1.02. Prior Agreement. City and Bureau recognize that prior to the effective date of this Agreement, City delegated certain convention and tourism responsibilities to the LUBBOCK CHAMBER OF COMMERCE (the "Chamber") pursuant to the terms of a contract dated June 14, 1979 (the "Prior Agreement"), which was amended on September 10, 1981, February 23, 1984, and March 22, 1984. The Prior Agreement and the delegation contained therein have been terminated and City has received or may receive from the Chamber certain assets used by the Chamber in providing convention and tourism services pursuant to the Prior Agreement. City Agrees that to the extent any such Convention and Tourism SeMce Agreement page 2 assets have been or are hereafter received by City, City immediately shall transfer such assets to Bureau for use by Bureau in conducting its programs and activities hereunder. 1.03. Governmental Requirements. Bureau shall conduct its programs and activities in accordance with all applicable laws, rules, statutes and regulations of federal, state and local governments, including, without limitation, the provisions of Chapter 351, Tax Code, as the same now exist or hereafter may be enacted and/or amended. 1.04. Term. This Agreement shall be for a term of five (5) years, beginning October 1, 1994 and ending September 30, 1999; provided, however, that there automatically shall be added to such term a one-year extension after the initial term if neither City nor Bureau gives written notice to the other party on or before April 1, 1999, or any subsequent April 1 st of its intent to terminate this Agreement at the end of its then - current term. ARTICLE H FISCAL MATTERS 2.01. Funding. City agrees to provide funding for the programs and activities conducted by Bureau pursuant to the terms of this Agreement by paying to Bureau a portion of the revenues derived from City's imposition and collection of the Hotel Tax. Such funding shall consist of (i) that portion of the Hotel Tax revenues allocated to "convention and tourism activities" under the provisions of Section 26-22, Code of Ordinances of the City of Lubbock, Texas, as the same may hereafter be amended, and (ii) funding from such other sources as may be approved by City. Bureau acknowledges that the funding of its activities by City with Hotel Tax revenues creates and establishes a fiduciary duty on the part of Bureau with respect to such funds. 2.02. Revenue Estimates. On or before April 1 of each year during the term of this Agreement, City shall estimate the amount of Hotel Tax revenue which will be collected and paid to Bureau during Bureau's next fiscal year, and shall provide written Cawendoa and Toarin" Service Agreemew Page 3 notice of that estimate to Bureau. Bureau's proposed budget for its next fiscal year shall reflect the revenue estimate so provided by City. As soon as reasonably possible following the end of each fiscal year and City's completion of its annual financial audit, City shall determine the actual amount of Hotel Tax revenue collected by City and allocated herein to the funding of Bureau's programs and services during the preceding fiscal year and shall provide written notice of such amount to Bureau. In the event the actual amount of such Hotel Tax revenue which is allocated to Bureau's programs and activities hereunder shall be either more or less than the actual amount of such revenue paid to Bureau with respect to such fiscal year, appropriate adjustments promptly shall be made in Bureau's budget for its current fiscal year in order to reduce its budgeted expenditures by an amount equal to any deficiency or to increase its budgeted expenditures by the amount of any excess. 2.03. Budgets. Bureau shall prepare and submit to City a detailed annual budget in a form acceptable to City. City and Bureau contemplate that the budget shall be submitted in a form substantially identical to the form used by City's departments in its internal budgeting process, provided that such form may be varied by agreement of City and Bureau. Bureau's initial budget for fiscal year October 1, 1994 -September 30, 1995 has been submitted to and approved by City simultaneously with City's approval of this Agreement. Each subsequent budget shall be submitted to City no later than the April 30 immediately preceding the fiscal year to which such budget relates. Upon receipt of Bureau's proposed budget, City shall review such budget and promptly notify Bureau of any changes and/or supplements to the proposed budget that the City believes are necessary. City and Bureau agree to work with one another and cooperate in good faith to address any such changes and/or supplements to the proposed budget. Following completion of any revisions to the proposed budget, City shall submit the proposed budget to the City Council for review and approval by the City Council in accordance with Chapter 102, Local Government Code, and Chapter 1, Article X, Paragraph 4, Lubbock Convention and Tourism Service Agreement Page 4 City Charter. The City's final approval of the budget, including any further revisions thereto which may be required by the City Council, shall be in writing, and no expenditures or obligations described in the budget shall be incurred by Bureau until final written approval of City has been obtained. City shall be responsible for holding any public hearings on the proposed budget which may be required by applicable law or regulation. 2.04. Payment. (a) Pument. All funds payable to Bureau with respect to any fiscal year shall be paid in four (4) equal quarterly installments, on October 1, January 1, April 1 and June 1 of each fiscal year, beginning October 1, 1994. Upon receipt of such funds, Bureau shall deposit the same in a separate account established by Bureau for that purpose at a federally -insured state or national bank or other savings institution in Lubbock, Texas. At Bureau's option, such account may be an interest-bearing account, in which case all interest accrued thereon shall be used by Bureau only for the purposes described in this Agreement in accordance with the terms of a budget approved by City. (b) Unexpended Funds. To the extent any unexpended funds shall remain at the end of a fiscal year, such unexpended funds are reappropriated to Bureau for use during the following fiscal year. Unless such unexpended funds already have been included in the approved budget for the following fiscal year or City and Bureau otherwise agree, Bureau shall determine the budget account or accounts in which such excess funds remain and the excess funds shall be added to the same account or accounts in the following budget in the same proportion. 2.05. Eanenditures. Revenues received by Bureau under the terms of this Agreement may be spent for day-to-day operations of the Bureau, supplies, salaries, office rental, travel expenses and other administrative costs, provided that no such revenues may be spent for travel for a person to attend an event or conduct an activity the primary purpose of which is not directly related to the promotion of tourism and the convention and hotel industry or the performance of the person's job in an efficient and professional Convention and Tourism Service Agreement Page 5 manner. Bureau shall not make any expenditures using funds provided hereunder unless such expenditures are incurred pursuant to the terms of a budget approved by City as provided in this Agreement. Anything contained elsewhere in this Agreement to the contrary notwithstanding, Bureau shall have the authority to reallocate up to 10% of any budget funds to any other budget account or accounts included in the budget without first securing City's approval. 2.06. Financial Reporting. Bureau shall maintain complete and accurate financial records of each expenditure of funds provided by City pursuant to the terms of this Agreement. All financial records of Bureau shall be maintained on an accrual basis, in accordance with generally accepted accounting principles consistently applied. Within thirty (30) days following the end of each fiscal quarter, Bureau shall provide to City a written financial statement for such quarter showing all revenues received by Bureau from City with respect to such quarter and listing all expenditures of the Bureau during such fiscal quarter in carrying out its programs and services under this Agreement. Bureau agrees to make all of its financial records available to City and, to the extent required by law, to other persons, provided that any inspection or review of Bureau's financial records shall be conducted only during Bureau's normal business hours at its offices. City, at its option, shall be entitled to have an audit of Bureau's financial records conducted by an auditor of City's choosing. Additionally, City is aware of the fact that Bureau shall have a complete audit of its financial affairs conducted following the end of each fiscal year by Bureau's independent auditor, and Bureau agrees to provide City with a copy of any audit report furnished to Bureau. 2.07. Fiscal Year. For purposes of this Agreement, Bureau's fiscal year shall begin on October 1 of each calendar year and shall end on September 30 of the following calendar year. Convention and Tourism Service Agreement Page 6 2.08. Other Revenue. Nothing contained in this Agreement shall prohibit Bureau from obtaining funding for its programs and activities from other sources, including charitable contributions and grants from private foundations and governmental organizations. All funds received by Bureau pursuant to the terms of this Agreement shall be maintained in a segregated account and shall not be commingled with any other funds belonging to Bureau. No funds paid to Bureau pursuant to this Agreement shall be used for any purpose other than the purposes stated in Section 1.01 and 2.05 of this Agreement and, to the extent the Bureau incurs expenditures in connection with the programs and activities described in Section 1.01 which also benefit other programs and activities conducted by Bureau, such expenditures shall be allocated equitably among the various funding sources available to Bureau based upon the relative benefits of such expenditures to the various programs and activities conducted by Bureau. ARTICLE III PERSONNEL 3.01. Personnel. Bureau shall set the qualifications for and shall hire any and all personnel Bureau deems necessary to discharge its responsibilities under the terms of this Agreement and shall have the authority to fix the compensation and other benefits payable to Bureau's employees. To the extent permitted by applicable law and provided City and Bureau agree, Bureau may make provision for participation by its directors, officers and employees in various benefit programs offered by City to its employees. Bureau, in carrying on its programs and activities hereunder, shall be acting solely as an independent contractor and not as an agent or employee of City. All employees of Bureau are employed solely by Bureau and do not constitute City employees. Bureau shall have the sole right and authority to direct the time, place and manner in which its employees perform the tasks for which they are hired, and shall be solely responsible for all income tax withholding, benefits, unemployment compensation payments and other expenses Convention and Tourism Service Agreement Page 7 associated with such employees. All contacts between City and Bureau personnel shall be coordinated through the President of Bureau's Board of Directors or such other person or persons as the Bureau's Board of Directors may designate. ARTICLE IV OFFICES 4.01. Existing Lease. By Lease Agreement dated July 28, 1994, City, as Lessee, leased from the LUBBOCK CHAMBER OF CONRJERCE (the "Chamber"), as Lessor, certain premises (the "Premises") in the Chamber's office building located at 14th and Avenue K in the City of Lubbock, Lubbock County, Texas. The Lease provides that City, without the Chamber's consent, may assign its rights in the leased premises to Bureau. By execution of this Agreement, City hereby assigns the Lessee's interest in the Lease to Bureau, and Bureau accepts such assignment and assumes and agrees to perform all of the Lessee's obligations set forth therein, subject, however, to the following provisions: (a) City represents to Bureau that (i) City has not received any notice of default on its part under the terms of the Lease, nor is City aware of any circumstances which, with passage of time or giving of notice or both, would constitute a default on its part under the terms of the Lease Agreement, and (ii) City has no knowledge of any conditions in or about the Premises, including environmental conditions, which are hazardous or otherwise are recognized to present a threat to the health and safety of persons in and about the Premises. (b) City recognizes that annual rent is due under the Lease on October 1 of each year, beginning October 1, 1994, and that City and Bureau will be in default under the terms of the Lease if the annual rent is not paid by October 15 of each year, and City therefore agrees to use its best efforts to insure that the quarterly payment due to Bureau on October 1 of each year is paid to Bureau in a timely manner so that Bureau may pay the annual rent due under the Lease prior to October 15 of such year; (c) If the Lease shall terminate for any reason, whether by expiration of the term of the Lease or otherwise, City agrees to use its best efforts to assist Convention and Tourism Service Agreement Page 8 Bureau in locating replacement premises on terms no less favorable to Bureau than those contained in the Lease, including, without limitation, leasing Bureau space in City -owned facilities if it is available; (d) In the event City, for any reason, shall cease to provide funds to Bureau pursuant to the terms of this Agreement, Bureau immediately shall reassign the Lease to City and City shall accept such reassignment and assume and agree to perform all of the obligations of the Lessee under the terms of the Lease; (e) In the event either City or Bureau receives any notice or communication from Landlord alleging a default or other failure to perform on the part of the Lessee under the terms of the Lease, the party so receiving such notice or communication immediately shall provide a copy thereof to the other party and City and Bureau shall cooperate with one another in reviewing and responding to such allegations; (f) Neither City nor Bureau shall agree to any amendment or modification of the terms of the Lease without the consent and joinder of the other. ARTICLE V TERMINATION 5.01. Termination. This Agreement may be terminated only by the non -renewal of its term as provided in Section 1.04, by the mutual agreement of City and Bureau or by default by either City or Bureau as provided in Section 5.02. 5.02. Default. Neither party shall be deemed to be in default under the terms of this Agreement unless and until it has received written notice from the other party specifically describing any failure on its part to perform its duties and obligations hereunder and does not cure such failure within ten (10) days following receipt of such written notice from the other party, provided, however, that in the event the nature of the failure is such that it reasonably cannot be cured within said ten-day period, no default shall occur hereunder so long as the party failing to perform commences to cure such failure within said ten-day period and thereafter diligently and in good faith prosecutes such cure to completion. Financial inability or delay shall not be deemed to be sufficient Convention and Tourism Service Agreement Page 9 cause to extend the cure period, unless any failure to perform by Bureau results from City's failure to timely pay to Bureau funds in the amounts and at the times provided elsewhere in this Agreement. 5.03. Remedies Upon Default. If an event of default shall occur under this Agreement, the non -defaulting party may terminate this Agreement upon written notice to the defaulting party and thereafter pursue such other remedies against the defaulting party as may be permitted by applicable law. Anything contained elsewhere in this Agreement to the contrary notwithstanding, however, no director, officer, employee or agent of either party to this Agreement shall be personally liable for any default by such party. 5.04. Procedure Upon Termination. If this Agreement shall terminate, whether by expiration of the term hereof or otherwise, Bureau, to the extent it may do so from available funds, promptly shall pay and discharge all outstanding liabilities incurred by Bureau during the term of this Agreement and thereafter shall pay and deliver to City all furniture, fixtures, equipment and other assets of Bureau which were purchased with funds provided by City hereunder and all unexpended funds provided by City which then are in Bureau's possession. All other assets of Bureau shall be disposed of in accordance with the provisions of Bureau's Articles of Incorporation and Bylaws. City shall assume and perform all outstanding contracts and obligations of Bureau to the extent such contracts and obligations may not be terminated by Bureau upon termination of this Agreement. ARTICLE VI MISCELLANEOUS 6.01. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof. Any modification or amendment of this Agreement shall be in writing and executed by both parties. Convention and Tourism Service Agreement Page 10 6.02. Avylicable Law. This Agreement shall be construed and enforced in all respects in accordance with the laws of the State of Texas and the laws of the United States applicable to transactions in Texas. 6.03. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall, for all purposes, be deemed to be an original, and all such counterparts shall together constitute but one and the same agreement. 6.04. Severability. If any provision of this Agreement or the application thereof to any person or circumstances shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement or the application of such provision to persons or circumstances, other than those as to which it is determined invalid or unenforceable, shall not be affected thereby, and each provision of this Agreement shall be valid and shall be enforced to the fullest extent permitted by law. 6.05. Captions. The captions in this Agreement are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope of this Agreement or the scope or content of any of its provisions. 6.06. Notices. (a) Any notice, report, request or demand required, permitted or desired to be given under this Agreement (hereinafter collectively referred to as "Notices") shall be in writing and shall be deemed to have been properly given or served when mailed by registered or certified mail, return receipt requested or personally delivered to the respective party at the following addresses: If to Bureau: President Convention and Tourism Bureau of Lubbock, Inc. Convention and Tourism Service Agreement Page 11 If to City: City Manager City of Lubbock P. O. Box 2000 Lubbock, Texas 79457-0001 (b) Any addressee or name specified above may be changed by a Notice given by the addressee to the other party in accordance with Section 6.07(a) above. (c) All Notices shall be deemed effective as of the date of mailing or on the date of personal delivery, as appropriate. Any Notice to be given by any party hereto may be given by counsel for such party. 6.07. Interpretation. Whenever herein the singular number is used, the same shall include the plural, and vice versa, and the masculine gender shall include the feminine and neuter genders, and vice versa, as the context shall require. The section headings used herein are for reference and convenience only and shall not enter into the interpretation hereof. 6.08. Time. Time is of the essence to this Agreement and the obligations of the parties hereunder; provided, however, that if any date specified herein for performance of any duty, obligation or responsibility shall fall on a Saturday, Sunday or legal holiday for national banks doing business in Texas, the time for such performance shall be extended until the next day which is not a Saturday, Sunday or legal holiday for national banks doing business in Texas. Convention and Tourism Service Agreement Page 12 EXECUTED AND EFFECTIVE this 22nd day of September, 1994. ATTEST: etty 4. Johnson, C Secretary BUREAU: THE CONVENTION AND TOURISM BUREAU OF LUBBOCK, INC. BY: CA President ATTEST: By: Secretary DGV:da/c&tagree/CGNVTGUR.doc September 8, 1994 Convention and Tourism Service Agreement Page 13 Item #20 AFFIDAVIT September 22, 1994 THE STATE OF TEXAS § COUNTY OF LUBBOCK § I, VICTOR HERNANDEZ , as a member of the CITY COUNCIL makelff—saffidavit and hereby on oath state the following: I, and/or a person or persons related to me, have a substantial interest in a business entity that would be peculiarly affected by a vote or decision of the City Council (city council, commis - as those terms are defined in Chapter 171, Local Government Code. sion or oar The business entity is name a rens have/has a substantial interest in this or name of relative and re ations -ip) business entity for the following reasons: (check all which are applicable). Ownership of 10% or more of the voting or shares of the business entity. Ownership of 10% or more or $5,000 or more of the fair market value of the business entity. Funds received from the business entity excess 10% of gross income for the previous year((my/her/his) Real property is involved and - have/has an equitable or / e/s e legal ownership with a fair market value of at least $2,500. A relative of mine has a substantial interest in the business entity or property that would be affected by a decision of the public body of which I am a member. Upon the filling of this affidavit with the City Secretary , I affirm city clerk or secretary) that I will abstain from voting on any decision involving this business entity and from any further participation on this matter whatsoever. Signed this 22nd day of September 94 ,tTgnature ot^tticiai / Councilmember e BEFORE ME, the undersigned authority, this day personally appear Victor Hernandez and on oath stated that the fa c s hereinabove state are true to the est o is knowledge or belief. Sworn to and subscribed before me on this 22nd day of September 1994 r Rotary Public in an or the State of Texas My commission expires: