TITLE
RESOLUTION APPROVING AMENDED AND RESTATED AGREEMENTS EFFECTIVE RETROACTIVE TO JULY 1, 2013 FOR THE DEVELOPMENT, IMPROVEMENT, OPERATION AND MANAGEMENT OF THE AMERICAN AIRLINES ARENA, THE MIAMI HEAT�S GUARANTY OF THE ARENA DEVELOPER�S AND MANAGER�S OBLIGATIONS, AND THE MIAMI HEAT�S ASSURANCES REGARDING NON-RELOCATION; WAIVING COMPETITIVE BIDDING FOR SELECTION OF DEVELOPER FOR ARENA IMPROVEMENTS AND MANAGER OF ARENA; DELEGATING TO COUNTY MAYOR OR MAYOR�S DESIGNEE THE AUTHORITY TO PERFORM CERTAIN ACTS AND EXERCISE CERTAIN CANCELLATION AND TERMINATION PROVISIONS, SUBJECT TO THE PARAMETERS SET FORTH IN THIS RESOLUTION AND THE ARENA AGREEMENTS; APPROVING, PURSUANT TO FLA. STAT. �125.35, HEAT OFFICE LEASE AND ARENA STORE LEASE; DELEGATING TO THE ARENA MANAGER THE AUTHORITY TO MANAGE AND AMEND THE ARENA STORE LEASE AND MANAGE THE HEAT OFFICE LEASE, SUBJECT TO THE PARAMETERS SET FORTH IN THE ARENA AGREEMENTS; AND AUTHORIZING COUNTY MAYOR OR MAYOR�S DESIGNEE TO EXECUTE ALL SUCH AGREEMENTS UPON FULFILLMENT OF CERTAIN CONDITIONS

BODY
WHEREAS, this Board previously adopted Resolution No. R-79-14 which provided for the negotiation of amendments to the American Airlines Arena agreements for an extension of the term of such agreements, subject to subsequent Board consideration and approval; and

WHEREAS, the following amended and restated agreements are being presented to this Board for approval, which agreements are all effective retroactive to July 1, 2013: the Amended and Restated Development Agreement and the Amended and Restated Management Agreement, both by and between the County and Basketball Properties, Ltd., a Florida limited partnership and affiliate of the Miami Heat (the �Arena Manager�); the Amended and Restated License Agreement and the Amended and Restated Assurance Agreement by and among the County, the Miami Heat Limited Partnership (the �Team�), and the Arena Manager; and the Amended and Restated Development Agreement Guaranty and the Amended and Restated Management and Assurance Agreement Guaranty both of which are made by the Team to and for the benefit of the County (hereafter collectively referred to as the �Arena Agreements�), each in substantially the form attached to this resolution as Attachments �A�, �B�, �C�, �D�, �E� and �F�, respectively, and incorporated herein by this reference, for the development, design, and construction of improvements to the American Airlines Arena (the �Arena�) and the management and operation of the Arena; and

WHEREAS, this Board finds that the planning, design and construction of additions and improvements to the Arena, the operation and management of the Arena and the performance of the Arena Agreements are in the best interests of the County and will serve a paramount public purpose; and

WHEREAS, the County Mayor has submitted to this Board a written recommendation that it is in the best interests of Miami-Dade County to waive formal bid procedures and the provisions of Section 5.03(D) of the Miami-Dade County Charter and Section 2-8.1(b) of the Miami-Dade County Code, and Implementing Order 3-38 in connection with the Arena Agreements:
1. for the selection of the Arena Manager as the developer of the additions and improvements to the Arena and on the Site (as such term is defined in the Arena Agreements); and
2. for the selection of the Arena Manager as the operator and manager of the Arena and the Site,
a copy of which is attached to this resolution and incorporated herein by this reference; and

WHEREAS, pursuant to Section 125.35, Florida Statutes, the following leases for portions of the Arena are being presented to the Board for approval: the Heat Office Lease and the Arena Store Lease by and between the County and the Team, each in substantially the form attached to this resolution as Attachments �G� and �H�, respectively (collectively referred to as the �Leases�), and incorporated herein by this reference; and

WHEREAS, this Board desires to accomplish the purposes outlined in the accompanying memorandum from the County Mayor, a copy of which is incorporated herein by reference,

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA, that:

Section 1. The foregoing recitals are incorporated in this resolution and are approved.

Section 2. This Board finds that it is in the best interest of Miami-Dade County to waive formal bid procedures in accordance with the provisions of Section 5.03(D) of the Home Rule Charter, Section 2-8.1 of the Code of Miami-Dade County, and the requirements of Implementing Order 3-38 in connection with the selection of the Arena Manager as the developer of additions and improvements to the Arena and the Site as set forth in the Amended and Restated Development Agreement, for the reasons set forth above and as otherwise outlined in the accompanying memorandum, formal bidding being waived in this instance by a two-thirds (2/3) vote of the Board members present.

Section 3. This Board finds that it is in the best interest of Miami-Dade County to waive formal bid procedures in accordance with the provisions of Section 5.03(D) of the Home Rule Charter, Section 2-8.1 of the Code of Miami-Dade County, and the requirements of Administrative Order 3-38 in connection with the selection of the Arena Manager as the operator and manager of the Arena and the Site as set forth in the Amended and Restated Management Agreement, for the reasons set forth above and as otherwise outlined in the accompanying memorandum, formal bidding being waived in this instance by a two-thirds (2/3) vote of the Board members present.

Section 4. This Board hereby approves the terms of the Arena Agreements with a term retroactive to July 1, 2013 and, pursuant to Section 125.35, Florida Statutes, the Leases, and all other rights and obligations conferred therein.

Section 5. The County Mayor or the County Mayor�s designee shall have the following authority:
(a) to execute such other documents and to take such action as may be necessary to execute and give effect to the intent of this resolution;
(b) to exercise such delegated authority as is specifically identified in the Arena Agreements and the Leases; and
(c) to determine the value and sufficiency of the alternative form of security in lieu of payment and performance bonds for each contract for construction, improvement or repair of the Arena, provided that, in determining the sufficiency and value of the alternative security the Mayor will consider the nature, history and financial capabilities of the Arena Manager, the contractual obligations secured by the alternative security, and the contractual safeguards in place to protect payments to persons performing the work and require that, prior to commencement of the work or purchase of supplies, any and all contractors hired by the Arena Manager to perform work for the construction, improvement or repair of the Arena has executed, delivered, and recorded in the public records a statutory payment and performance bond in the full amount of the contract naming the County as an obligee, all as required by Section 255.05, Florida Statutes.
In addition, and notwithstanding any of the foregoing, the County Mayor or the County Mayor�s designee shall be required to seek Board approval for any approvals, consents, actions, events or undertakings that would violate, alter, or ignore the substantive provisions of the Arena Agreements or the Leases, or that would create a financial obligation, cost or expense to the County that is greater than the delegated procurement authority of the County Mayor, as set forth in the County Charter, County Code, and any administrative or implementing orders.

Section 6. The Arena Manager shall have the authority to exercise such delegated authority to manage the Arena Store Lease and the Heat Office Lease on behalf of the County and to amend the Arena Store Lease as is specifically identified in the Arena Agreements and subject to the prior fulfillment of the Conditions Precedent (as such term is defined below).

Section 7. This Resolution shall become effective upon the occurrence of all of the following: (a) receipt by the County Mayor, with a copy to the County Attorney, of evidence that the National Basketball League has provided the necessary consents and approvals of the Arena Agreements and the Leases; and (b) receipt by the County Mayor, with a copy to the County Attorney, of evidence that the Lender (as such term is defined in the Arena Agreements) has provided the necessary consents and approvals of the Arena Agreements (collectively, the �Conditions Precedent�). The Board hereby authorizes the County Mayor or the County Mayor�s designee to execute the Arena Agreements and the Leases on or after the effective date of this Resolution.

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Date:
To: Honorable Chairwoman Rebeca Sosa
and Members, Board of County Commissioners

From: Carlos A. Gimenez
Mayor

Subject: Amended and Restated Agreements Between Miami-Dade County and Miami Heat Limited Partnership, a Florida limited partnership and Basketball Properties, Ltd. for the Development, Improvement, Operation and Management of the AmericanAirlines Arena

..Recommendation
It is recommended that the Board of County Commissioners (Board) approve this item, which does the following:
* Approves the terms and authorizes execution of the attached amended and restated agreements all dated and effective retroactive to July 1, 2013 (collectively, the Proposed Arena Agreements) among Miami-Dade County (County) and Miami Heat Limited Partnership, a Florida limited partnership (Team) and Basketball Properties, Ltd. (Arena Manager), a Florida limited partnership and affiliate of the Team, for the development, improvement, operation and management of a professional sports franchise facility, which is known as the AmericanAirlines Arena (Arena).
* Authorizes the waiver of competitive bidding, as was required for the original agreements (Current Arena Agreements), pursuant to Section 5.03(D) of the Home Rule Charter and Section 2-8-1(b) of the Miami-Dade County Code of Ordinances (Code) and Implementing Order 3-38 by a two-thirds vote of the members present to select the Arena Manager as the developer and operator of the Arena and the site. The waiver of competitive bidding is in the best interest of the County due to the fact that the Arena Manager is an affiliate of the Team who holds the National Basketball Association (NBA) franchise rights for South Florida.
* Approves the Office Lease Agreement (Heat Office Lease) and Retail Lease Agreement (Arena Store Lease), and authorizes the Arena Manager to exercise such delegated authority to manage the Arena Store Lease and the Heat Office Lease on behalf of the County and to amend the Arena Store Lease only as specifically permitted in the Proposed Arena Agreements and subject to the prior fulfillment of the Conditions Precedent.

The attached resolution will become effective when formally approved by the NBA and the Team's financial lender (collectively, the Conditions Precedent).

In November 2012, the Arena Manager exercised its contractual option to negotiate an extension of the term of the Management Agreement, obligating the County to negotiate in good faith an extension. Subsequently, on January 22, 2014, the Board through Resolution R-79-14 directed that the Mayor negotiate with the Arena Manager. The Proposed Arena Agreements before the Board incorporate changes to the Current Arena Agreements, which were originally adopted by the Board in 1997, and extend the terms of the contracts by ten years, and is the result of negotiations between the Arena Manager, Team, and the County. The Proposed Arena Agreements include the following: (1) Amended and Restated Management Agreement; (2) Amended and Restated Miami Heat License Agreement; (3) Amended and Restated Assurance Agreement; (4) Amended and Restated Management and Assurance Agreement Guaranty; (5) Amended and Restated Development Agreement; (6) Amended and Restated Development Agreement and Guaranty; and (7) Heat Office Lease and Arena Store Lease.

Scope
The documents provide, among other things, for the development, improvement, management and operation of a professional sports facility, the Arena, located at 601 Biscayne Boulevard. While the Arena is located in District 3, which is represented by Commissioner Audrey M. Edmonson, the overall impact is countywide in nature.

Fiscal Impact
The funding sources for payments made by the County to the Arena Manager are County Available Arena Funds, which are generally comprised of, in any fiscal year, the sum of: (1) excess Convention Development Tax (CDT); (2) County Rental Revenues; (3) Naming Rights receipts, if any, (4) monies paid to the County at Community Events held at the Arena. The Arena Manager will also make annual guaranteed payments to the County, retroactive to July 1, 2013, throughout the term of the Proposed Arena Agreements.

Below is a detailed explanation of the proposed changes to the funding contributions made by both the County and the Arena Manager. Any reference to "Years" throughout this memorandum reflects the Arena's fiscal year which covers the period from July 1 to June 30.

County's Annual Payment
The Current Arena Agreements, which expire in 2030, originally required the County to provide the Arena Manager with an annual payment of $8.5 million through fiscal year 2029 and $3.5 million in fiscal year 2030 to be used for both operational expenses and Naming Rights related to the Arena. The 2029 annual payment is $3.5 million because the Arena Manager was provided $5 million at the time the Arena opened in 2000. A subsequent amendment (Composite Amendment One) transferred the Naming Rights responsibilities from the County to the Arena Manager and the Arena Manager�s sale of the Naming Rights to American Airlines resulted in a $2.1 million reduction to the County�s annual payment from $8.5 million to $6.4 million through December 31, 2019 when the current Naming Rights deal expires.

Under the Current and Proposed Arena Agreements the Arena Manager may extend the American Airlines Naming Rights Agreement through the full term of the Original Management Agreement (January 1, 2020 through June 30, 2030), subject to the Board�s approval of such extension in the Board�s sole and absolute discretion. If the American Airlines Naming Rights Agreement is extended for such term the Naming Rights Receipts received by the Arena Manager exceeding $2 million will be shared equally by the Arena Manager and the County.

If the American Airlines Naming Rights Agreement is not extended, the County at that time could elect to sell the Naming Rights, subject to exercising the option to sell no later than December 31, 2018. If the County does not exercise this option by such date, the Arena Manager has the right to sell the Naming Rights to the Arena for the term commencing January 1, 2020 and ending on June 30, 2030, subject to certain restrictions set forth in the Management Agreement. The Board would need to approve the new deal. Furthermore, the County would no longer be required to pay the annual $2 million Naming Rights Payment and would receive an equitable share of the Net Naming Rights Receipts. This amount would be agreed upon by the Arena Manager and the County at that time. If the parties cannot come to an agreement, they will bring in a mediator and if still at impasse, the matter would be referred to arbitration for consideration by an industry expert. The arbitrator�s ruling on the equitable share for the Arena Manager and the County would be binding. The resolution of the Naming Rights Dispute will be based generally upon a review and determination of the Net Naming Rights Receipts, the rights and obligations of the parties under the Proposed Arena Agreements and consideration of other naming rights agreements between governmental bodies and arena managers that are affiliated with professional sport franchises as well as the overall economic terms agreed to by them regarding the use and management of such comparable arenas. From July 1, 2030 to June 30, 2040, the County has the right to sell the Naming Rights or transfer them to the Arena Manager. If the Naming Rights are transferred to the Arena Manager, the County would not be obligated to make the $2 million Naming Rights Payment and the County would be entitled to receive an equitable share of the Net Naming Rights Receipts. The County�s equitable share would be determined using the same negotiation/mediation/arbitration process set forth in above.

From July 1, 2030 to June 30, 2035, the County�s annual payment toward operational and maintenance expenses increases to $8.5 million. The present value (PV) of $8.5 million in 2031 is worth about $5.1 million in today�s dollars, which is less than the $6.5 million the County is currently paying. This change is proposed in consideration of there not having been any annual adjustments for inflation or consideration for the increased cost of operating and maintaining an older facility. Additionally, in the Current Arena Agreements, the County is required to maintain a CDT reserve account equal to that year's payment amount in case of a shortfall in collections. The Proposed Arena Agreements continue to require the reserve account to correspond with the County's annual payment, which as referenced above, will be $8,500,000 from 2031 to 2035. The reserve account will remain in place through 2035 since CDT funds are the only funds pledged to meet the annual payment. It is important to note that at no time will the County�s General Fund ever be at risk to make any payments related to these agreements.

The County continues to be obligated to make its annual Naming Rights Payment of $2 million bringing the annual total payment to $10.5 million, assuming that the Naming Rights are not sold or transferred to the Arena Manager. The following tables show the current amount of the County's annual payment and the proposed annual payments assuming that Naming Rights are sold or transferred at amounts at least equal to the County�s Naming Rights Payment. With the exception of the $2 million Naming Rights Payment if the County elects to sell Naming Rights, there are no payments due from the County to the Arena Manager in the last five years of the term of the Proposed Arena Agreements.

Current -
County's Annual Payments Proposed -
County's Annual Payments Year Amount Year Amount Year Amount 2014 $6,400,000 2028 6,400,000 2031 $8,500,000 2015 6,400,000 2029 6,400,000 2032 8,500,000 2016 6,400,000 2030 1,500,000 2033 8,500,000 2017 6,400,000 2031 * 2034 8,500,000 2018 6,400,000 2032 * 2035 8,500,000 2019 6,400,000 2033 * 2036 ** 2020 6,400,000 2034 * 2037 ** 2021 6,400,000 2035 * 2038 ** 2022 6,400,000 2036 * 2039 ** 2023 6,400,000 2037 * 2040 ** 2024 6,400,000 2038 * ��Total 2031 - 2040: $42,500,000 2025 6,400,000 2039 * ��Net Present Value: $27,461,138 2026 6,400,000 2040 * � � 2027 6,400,000 � � � � Total through 2030: $103,900,000 � � * The current contract ends in 2030. ** The Parties may, but are not required to, renegotiate terms for the 2036 to 2040 period. The term of the extension is 10 years with a right to terminate early for convenience no sooner than July 1, 2035 if either party chooses.Arena Manager's Contribution
The Original Arena Agreements required the Arena Manager to provide the County 40 percent of "Arena Distributable Net Cash Flow.� The formula for this distribution is in essence annual Arena Revenues minus Arena Operating Expenses minus Amortization of debt incurred by the Team to construct the Arena minus $14 million profit distribution to the Arena Manager with the result to be multiplied by 40 percent. For example, if you applied the formula described above to a given year and the threshold was exceeded by $100, the Arena Manager would be entitled to $60 and the County would receive $40. In the 13 years these agreements have been in place, 2013 was the first year the formula resulted in a payment to the County ($257,134).

The Proposed Arena Agreements eliminate this formula and replace it with a fixed annual revenue stream to the County in the form of a donation for use by the County's Parks, Recreation and Open Spaces Department for County-owned parks, recreation and youth programs. The first payment of revenue to the County will be $1 million retroactive to July 1, 2013 and subsequent annual payments of $1 million will be made through 2030. The annual amount from 2031 to 2035 increases $1.25 million. There are no donations due from the Arena Manager in the last five years of the term of the Proposed Arena Agreements. The table below shows the amount of the Arena Manager's Contribution.


Proposed - Arena Manager's Contribution Year Amount Year Amount 2014 $1,000,000 2028 1,000,000 2015 1,000,000 2029 1,000,000 2016 1,000,000 2030 1,000,000 2017 1,000,000 2031 1,250,000 2018 1,000,000 2032 1,250,000 2019 1,000,000 2033 1,250,000 2020 1,000,000 2034 1,250,000 2021 1,000,000 2035 1,250,000 2022 1,000,000 2036 - 2023 1,000,000 2037 - 2024 1,000,000 2038 - 2025 1,000,000 2039 - 2026 1,000,000 2040 - 2027 1,000,000 � � Total through 2040: $23,250,000 Net Present Value: $13,635,237 The Arena Manager currently pays the County rent for permanent retail that is located outside of the Arena. The formula in the Current Arena Agreements calls for the Arena Manager to pay the County annually the greater of (1) $75,000; (2) $5 per square foot; or (3) 25 percent of the net rental fee. The Proposed Arena Agreements increase the $75,000 to $125,000, increase the $5 per square foot amount by 3.75 percent annually beginning in 2031 and deletes the 25 percent net rental option. Currently, the amount of square footage built outside of the Ticket Secure Zone is a 17,134 square foot structure that is currently leased to Bongos Cuban Caf� and represents annual revenue to the County in the amount of $85,670. This amount would increase to $125,000 under the Proposed Arena Agreements and could increase if the Arena Manager adds on permanent retail space as would be permitted under the Proposed Arena Agreements.

Track Record/Monitoring
The County has no record of negative performance issues with the Team or the Arena Manager. Jose A. Galan, Real Estate Development Division, Internal Services Department, will be managing these agreements.

Delegation of Authority
Attachment 1 provides a breakdown of the delegated authorities for the Proposed Arena Agreements.

BODY
The Team was awarded an expansion franchise in 1988 and played their home games at the former Miami Arena until mid-way through the 1999-2000 NBA season, when they moved into the newly constructed Arena. The Arena sits on County-owned land and the construction of the Arena was funded 100 percent by the Team in exchange for the land, and as discussed earlier in this memorandum, an annual payment from the County. During their existence, the Team has been to four NBA Finals and has won the NBA Championship on three occasions.

The County and the Arena Manager originally executed a series of agreements dated April 29, 1997 to provide, among other things, for the development, management and operation of a professional sports franchise facility, now the Arena. These agreements have been amended from time to time since their original execution through a number of Composite Amendments.

Proposed Arena Agreements
These agreements have been simplified and modified to incorporate changes from previous Composite Amendments due to the passage of time, which has rendered many of the provisions no longer applicable. Among other things, they support the development of the County, its convention, tourism, economic development and entertainment industries and the local economy; preserve downtown Miami as the home of a major professional sports franchise; encourage the growth of cultural, tourism, economic development and entertainment opportunities; and recognize the Team as an integral part of the revitalization and resurgence of downtown Miami and a prominent symbol of the vibrancy of Miami-Dade County.

Amended and Restated Management Agreement
The County and the Arena Manager have determined that the operation of the Arena and the garage and the performance of this agreement for the management and operation of the Arena are in the best interests of the County and serve a paramount public purpose. Significant changes from the current agreement, some of which were covered earlier in this memorandum, are listed below:
* The expiration date is extended from June 30, 2030 to June 30, 2040. Beginning in 2025, BPL and/or the County can request to renegotiate in good faith the financial terms of the deal for years July 1, 2035 through June 30, 2040 and if either party elects, they may terminate the Proposed Arena Agreements beginning in July 1, 2035.
* The County and the Arena Manager will jointly select an independent Consulting Engineer to inspect the Arena and determine if it is in good condition and consistent with the Arena Manager maintaining the Arena as a first class sports and entertainment facility comparable with similar arenas housing NBA teams constructed with similar amenities between December 31, 1996 and December 31, 1999. If not in good condition and working order, the agreement provides specific language to remedy the matter. In the proposed agreement, both parties can challenge the findings of the Consulting Engineer, in excess of $250,000, and at that point a Reviewing Engineer will make a binding determination.
* It increases the maximum square footage on the Heat Store from 6,000 square feet to 12,000 square feet and authorizes the Arena Manager to exceed the current maximum square footage of 5,000 square feet of permanent retail permitted on Arena patios and terraces within the Ticket Secure Zone. But any increases in square footage over the current maximum allowed footage for the Arena Store Lease and the permanent retail on Arena patios and terraces requires the Arena Manager to pay rent to the County using the formula previously discussed.
* Establishes the Arena Manager's annual donation to the County�s Parks, Recreation and Open Spaces Department.
* Increases the required amount the Arena Manager makes to the Arena Capital Replacement Reserve Fund (Fund), which will total $81,146,335 between July 1, 2013 and June 30, 2040. This includes an amount of $10,247,544 in 2014 and an amount of $1,600,000 for 2015 with subsequent years increasing the 2015 figure by four percent per year. These amounts are compared to the Current Arena Agreements, which calls for $1,115,168 in 2014 and an amount of $1,148,623 for 2015 with subsequent years increasing by the Consumer Price Index (CPI). In the Proposed Arena Agreements the amount required to be deposited into the Fund does not have to be spent in any given year, although the amount spent on the Arena at the end of the term of the Proposed Arena Agreements must not be less than $81,146,335. That said, the Arena Manager is responsible for maintaining the Arena as a first class sports and entertainment facility as discussed above and may be required to spend significantly more than the minimum requirement. The table below shows the required payments to the Fund.

Current - Arena Capital Replacement
Reserve Fund * Proposed - Arena Capital Replacement
Reserve Fund Year Amount Year Amount Year Amount Year Amount 2014 $1,115,168 2028 1,686,792 2014 $10,247,544 2028 2,664,118 2015 1,148,623 2029 1,737,395 2015 1,600,000 2029 2,770,682 2016 1,183,082 2030 1,789,517 2016 1,664,000 2030 2,881,510 2017 1,218,574 2031 1,843,203 2017 1,730,560 2031 2,996,770 2018 1,255,131 2032 1,898,499 2018 1,799,782 2032 3,116,641 2019 1,292,785 2033 1,955,454 2019 1,871,774 2033 3,241,306 2020 1,331,569 2034 2,014,117 2020 1,946,645 2034 3,370,959 2021 1,371,516 2035 2,074,541 2021 2,024,510 2035 3,505,797 2022 1,412,661 2036 2,136,777 2022 2,105,491 2036 3,646,029 2023 1,455,041 2037 2,200,881 2023 2,189,710 2037 3,791,870 2024 1,498,693 2038 2,226,907 2024 2,277,299 2038 3,943,545 2025 1,543,653 2039 2,334,914 2025 2,368,391 2039 4,101,287 2026 1,589,963 2040 2,404,962 2026 2,463,126 2040 4,265,338 2027 1,637,662 � � 2027 2,561,652 � � Total through 2040: $45,398,081 Total through 2040: $81,146,335 * Assumes annual CPI growth of three percent.

* The original agreement references a Minority Business Enterprise program. The proposed agreement modifies the language to a Small Business Enterprise program, which is consistent with current County Code. This provision in the agreement requires the Arena Manager to award 25 percent to 35 percent of new third-party contracts related to the operations of the Arena to Small Business Enterprise eligible firms.
* Language related to the Inspector General has been updated.
* Language related to public records has been updated in accordance with State law.
* Language was added to ensure insurance proceeds, resulting from a casualty event, are first used to address the needs of the Arena.
* Deleted all references related to the County's right to share in the Arena Distributable Net Cash Flow, including references to the capital and operating budgets for the Arena.

Amended and Restated Heat License Agreement
This agreement states that the Team is the owner of a NBA professional basketball franchise known as the Miami Heat. In this License, the Team agrees to play its Home Games at the Arena during the term of the agreements. Significant changes from the current agreement are listed below:
* The expiration date is extended from June 30, 2030 to June 30, 2040. Beginning in 2025, BPL and/or the County can request to renegotiate in good faith on the financial terms of the deal for years July 1, 2035 through June 30, 2040 and if either party elects, they may opt out of the Proposed Arena Agreements beginning in July 1, 2035.
* Language related to the Inspector General has been updated.
* Language related to public records has been updated in accordance with State law.

Amended and Restated Assurance Agreement
This agreement states that the Arena Manager is an affiliate of the Team and that the Team is a member of the NBA. The Team will continue to utilize the Arena under the management of the Arena Manager and will continue to remain located in the County through the extended term. Significant changes from the current agreement are listed below:
* The expiration date is extended from June 30, 2030 to June 30, 2040. Beginning in 2025, BPL and/or the County can request to renegotiate in good faith the financial terms of the deal for years July 1, 2035 through June 30, 2040 and if either party elects, they may terminate the Proposed Arena Agreements beginning in July 1, 2035.
* The language related to the County's CDT reserve account increases from the current $6.4 million to $8.5 million (PV of $5.1 million) in FY 2031 to match the annual County contribution increase.
* The parties recognize that the conditions subsequent were satisfied so all of those were deleted.
* Language related to the Inspector General has been updated.
* Language related to public records has been updated in accordance with State law.

Amended and Restated Management and Assurance Guaranty
This agreement states that the County required as a condition precedent to entering into the Original Management Agreement and the Original Assurance Agreement, that Guarantor execute and deliver a Management and Assurance Guaranty of all of the Arena Manager�s obligations (whether of payment and/or performance) under and in accordance with both the Original Management Agreement and the Original Assurance Agreement, which Guaranty is absolute, unconditional and irrevocable except as specifically set forth the Guaranty. The Guarantor has a financial interest in the Arena Manager and an interest in the operation of the Arena pursuant to both the Management Agreement and the Assurance Agreement, and has agreed to execute and deliver this Guaranty. Significant changes from the current agreement are listed below:
* The term of the guaranty is extended to cover the term of June 30, 2030 to June 30, 2040. Language related to the Inspector General has been updated.
* Language related to public records has been updated in accordance with State law.

Amended and Restated Development Agreement
This agreement states that the Arena Manager will continue to undertake improvements and enhancements to the Arena and it will continue to be maintained as previously described. Significant changes from the current agreement are listed below:
* The expiration date is extended from June 30, 2030 to June 30, 2040. The term of the Development Agreement is coterminous with the Management Agreement..
* The agreement refers to the Amended and Restated Management Agreement in order to address remedies in the event the limit of 30,000 square feet of permanent retail space is challenged in relation to the deed restrictions on the site.
* Mentions that if Phase II of roadways is constructed, the County will be responsible for the planning, design, construction and operations.
* Discusses Arena Additions and requires the Arena Manager to seek approval from the County for any projects with costs in excess of $500,000 or which will affect the exterior of the Arena.
* Restricts the County from constructing any Arena Additions, which are prohibited by the Team License, any Heat Office Lease, or any Arena Store Lease without the prior written consent of the Arena Manager.
* Requires the Arena Manager to provide payment and performances bonds prior to entering into any contracts, purchasing or ordering any supplies, materials, or equipment and/or any construction.
* Outlines the requirements if the Arena Manager desires to build out some or all of the remaining square footage of permanent retail space.
* Prevents the Arena Manager from changing the configuration or number of Suites or Premium Seating without providing a copy of the plans and specifications for the change to the County Representative for its approval.
* The Art and Public Places, Small Business programs, Responsible Wages, Residents First Program, Inspector General and public records� language has been updated to reflect State Statute, County Code and any corresponding Implementing Order.
* As it relates to Small Business programs, the County must provide goals within 10 business days of receipt of a submitted package from the Arena Manager.

Amended and Restated Development Agreement Guaranty
This agreement provides for the improvement and repair of the Arena by the Arena Manager on behalf of the County. Significant changes from the current agreement are listed below:
* The term of the guaranty is extended to cover the period from June 30, 2030 to June 30, 2040.
* Language related to the Inspector General has been updated.
* Language related to public records has been updated in accordance with State law.

Conclusion
It is in the best interest of the County to ensure that the Miami Heat remain as users of the Arena for the long-term. This agreement accomplishes that goal by extending the Current Arena Agreements for an additional ten years, and, also addresses numerous financial provisions that, given the passage of time of these agreements, more equitably adjust the County's annual payment made to the Arena Manager, as well as provide a guaranteed influx of revenue to the County.

Just blocks west of the Arena is a reminder of what happens when you do not have long-term commitments: an empty lot of where the Miami Arena once stood. Without the proper upkeep and long-term agreements, the Miami Arena, which opened in 1988, was soon considered outdated and inadequate, and both the Heat and the Florida Panthers moved out within 12 years. Also, these agreements are open for renegotiation by either party starting in 2025 to renegotiate the economic terms for the five year period from July 1, 2035 through June 30,2040. During this timeframe, the annual commitment of the Convention Development Tax to fund debt service for the Marlins Stadium balloons from $23 million in 2036 to $83 million in 2040 with an additional annual debt service increase to $118 million in 2041. It is prudent now to provide future administrations the opportunity to evaluate what they can afford to pay from the Convention Development Tax in that timeframe.

The Team entered this season as the reigning back-to-back defending champions and has brought an enormous amount of pride to the residents of Miami-Dade County. The national and international exposure provided by having the Miami Heat call Miami-Dade County home cannot be understated.

Attachments

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Edward Marquez
Deputy Mayor