Golf Course Advisory Board Agenda and Packet 2010 06 21

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Fee shall be paid on an annual Fiscal Year basis as provided herein. In the event an annual audit of the operations of the Golf Course by an independent certified public accountant results in a determination that Gross Revenues for the subject year differs from the amount reported to City by WGP for the same year, then any excess or deficiency in the amount of the Incentive Fee paid for such year (including the final year of the Term) shall be paid within ten (10) days after completion of the audit and disclosure of the excess or deficiency. The method of payment of compensation for the Incentive Fee shall be governed by the Section 5.02. WGP shall retain all Gross Revenues less costs and expenses incurred in performing its obligations hereunder. 5.02 Method of Payment and Calculations of the Annual Incentive Fee. Within thirty (30) days following the end of each Fiscal Year (or any portion of any such Fiscal Year, in the case of a partial Fiscal Year at the beginning or end of the Tenn of this Agreement), WGP shall prepare and submit to City an annual Operating Report required under Article VII, below, for the immediately preceding Fiscal Year, accompanied by a separate statement which details the amount of the annual Incentive Fee due and owing, and WGP shall also remit such annual Incentive Fee to City. The City in its sole discretion may decline any portion of an Incentive Fee payment upon its determination that declination thereof is necessary to ensure continuing compliance with requirements related to outstanding general obligation debt financing for the Golf Course. 5.03 Out-of-Pocket and Operatinl! Costs. In addition to the amounts described in this Article, above, throughout the Term, WGP shall also pay for all costs of Equipment and Supplies for operation of the Golf Course including, without limitation, costs for utilities, plumbing, electrical, repairs, grounds maintenance, pumps, motors, walk-in freezers, floor coverings, interior and exterior painting, decorating and landscaping, food and beverage service, pro-shop activities and all other costs and activities necessary or incidental to operate a full service 18 hole golf course. WGP share bear all of its business expenses incurred in the course of performing its obligations hereunder, such as travel, mileage, food and lodging expenses when visiting the Golf Course, long distance telephone charges, express mail and facsimile transmissions. 5.04 Payment of Compensation to City: Penalties. In the event that amounts owed to City under this Article are not paid within fifteen (15) days after such payment is due under the terms of this Agreement, then WGP shall be assessed a penalty of three percent (3%) of such amounts owed as a fair and reasonable estimate of costs City will incur by reason of late payment. This penalty is in addition to interest that is accrued on past due amounts under the Interest heading of Article XV and does not alter any rights City may have with regard to an event of Default under this Agreement. ARTICLE VI Bank Accounts 6.01 Bank Account(s). On a daily basis, WGP shall deposit all Gross Revenues and other funds collected from the operation of the Golf Course in one or more deposit accounts. These account(s) shall be maintained at the sole direction of and in the name of WGP and shall be used for the payment of all costs, including without limitation payroll expenses of the Golf Course Personnel and any monies owed to City pursuant to this Agreement. The funds held therein shall belong to WGP. 6.02 Fiduciary Responsibility. WGP shall have a fiduciary duty to the City with respect to its operation of the Golf Course and shall faithfully account to the City all funds attributable to its operation of the Golf Course. WGP shall hold and handle such funds in trust for the City in accordance with this Agreement and shall not commingle any funds except as may be specifically permitted herein. ARTICLE VII Financial and Reporting Matters 9 Initials: fIr!\