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HomeMy WebLinkAbout2009-05-09; Carlsbad Tourism Business Improvement District; 05-09-42; Mindgruve contract for Endless SummerCARLSBAD TOURISM BUSINESS IMPROVEMENT DISTRICT AGENDA BILL AB# MTG. DEPT. 05-09-42 5-5-09 Admin Services Mindgruve Contract for "Endless Summer" Marketing Campaign CTBID STAFF GENERAL COUNSEL RECOMMENDED ACTION: 1. Adopt Resolution 2009-2 authorizing the Board Chairperson to sign contract with Mindgruve to perform the "Endless Summer" marketing campaign and appropriate $250,000. ITEM EXPLANATION: The Carlsbad City Council met recently with Chamber members and other business community representatives during an open forum to discuss ways the city could help support the local economy. Dubbing their effort the "Carlsbad Economic Stimulus Plan," the City Council focused on ideas that would produce timely results, generate a measureable return on investment, and have a direct impact on business revenues and jobs. Reint Reinders, on behalf of the CTBID Board, presented an "Endless Summer" marketing campaign to Council.(see more detail on the program at Exhibit 1) This 90-day campaign targets Los Angeles and Orange County visitors through on-line and print media. The total cost of the campaign, developed by Mindgruve, is $250,000. The proposed funding is $100,000 from the City of Carlsbad General fund, $100,000 from CTBID reserves and a $50,000 grant from NRG. Given the recent downturn in the economy, the City Council agreed to their $100,000 contribution to help fund the campaign. In order to begin working on the marketing campaign in early May as planned, the CTBID Board will need to enter into the contract with Mindgruve and appropriate the entire $250,000. Full funding to Mindgruve will be contingent on the CTBID receiving the $100,000 from the City of Carlsbad and $50,000 from NRG. FISCAL IMPACT: The CTBID has $230,000 in reserves. The additional $20,000 needed will be transferred from the CTBID grants budget which has $23,000 uncommitted for this year. Once the $100,000 from the City and $50,000 from NRG is received, it will be deposited into the CTBID reserves. DEPARTMENT CONTACT: Cheryl Gerhardt, 760-602-2409, cgerh@ci.carlsbad.ca.us FOR CITY CLERKS USE ONLY. BOARD ACTION: APPROVED DENIED "D CONTINUED D WITHDRAWN D AMENDED D CONTINUED TO DATE SPECIFIC D CONTINUED TO DATE UNKNOWN D RETURNED TO STAFF D OTHER - SEE MINUTES D ENVIRONMENTAL IMPACT: This action does not approve any projects that will have a physical adverse affect on the environment so it falls within the general rule under CEQA that this is not a project (CEQA Regulation 153789(b)). EXHIBITS: 1. Endless Summer Marketing Campaign presentation 2. Resolution 2009-2 authorizing the Board Chairperson to sign contract with Mindgruve to perform "Endelss Summer" Marketing campaign and appropriate $250,000 to fund the progarm. 3. Mindgruve "Endless Summer" marketing campaign contract 1 RESOLUTION NO. 2009-2 2 A RESOLUTION OF THE CARLSBAD TOURISM BUSINESS IMPROVEMENT DISTRICT (CTBID) BOARD OF DIRECTORS 3 AUTHORIZING THE SELECTION MINDGRUVE TO DEVELOP AND IMPLEMENT AN ENDLESS SUMMER MARKETING 4 CAMPAIGN 5 WHEREAS, the Carlsbad Tourism Business Improvement District (CTBID) was formed by 6 the City Council of the City of Carlsbad, California on November 15, 2005; and 7 WHEREAS, the CTBID Board of Directors has all of the powers, duties and responsibilities 8 provided to it under the Parking and Business Improvement Area Law of 1989, Section 36500 et seq. of 9 the Streets and Highway Code, and Chapter 3.37 of the Carlsbad Municipal Code; and 10 WHEREAS, the powers of the CTBID Board of Directors include the ability to contract for 11 services directly related to tourism promotion and marketing of the City of Carlsbad as a travel 12 destination; and 13 WHEREAS, the CTBID Board of Directors intends to undertake a marketing program designed 14 to increase tourism activities during the 2009 summer months within the City of Carlsbad; and 15 WHEREAS, the CTBID Board of Directors further intends to contract for services to perform a 16 summer marketing campaign; and 17 WHEREAS, Mindgruve has presented the Board with a detailed marketing plan for the summer 18 months for a total cost of $250,000 ; and 19 WHEREAS, sufficient funds are available in the 2008-09 budget. 20 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Carlsbad Tourism 21 Business Improvement District, as follows: 22 1. That the above recitations are true and correct. 2. That the firm Mindgruve is selected to perform the marketing campaign. 3. That the agreement between Mindgruve and the CTBID is hereby approved and the Board 24 Chair is herby authorized and directed to execute said agreement which shall be acknowledged by the Clerk of the Board. 25 4. That $100,000 be appropriated from the CTBID reserves to fund the project and further funded by grants from the City Council in a sum of $ 100,000 and from NRG in the sum of 26 $50,000. 27 /// 28 /// 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PASSED, APPROVED, AND ADOPTED at a regular meeting of the Board of Directors of the Carlsbad Tourism Business Improvement District on the^tday ofMay 2009, by the following vote to wit: AYES: Board Member? Sbute, Stripe, Canepa, Howard-Jone?, Becerra NOES: None. ABSENT: Board Member Cima ATTEST: Chairperson 'ProT^Clerkofthe^ Carlsbad Tourism Business Improvement District -2- AGREEMENT BETWEEN CARLSBAD TOURISM BUSINESS IMPROVEMENT DISTRICT AND MINDGRUVE, INC. This agreement is made and entered into as of the ff day of May . 2009, ("Effective Date") by and between the Carlsbad Tourism Business Improvement District (hereinafter "CTBID"), with its principal place of business as Carlsbad Tourism Business Improvement District c/o City of Carlsbad 1635 Faraday, Carlsbad, CA 92008 and Mindgruve, Inc., with its principal place of business as 1018 Eighth Avenue, San Diego, CA 92101 (hereinafter "Mindgruve" or "Contractor"). RECITALS A. City Council of the City of Carlsbad adopted Ordinance No. NS-778 enacting Chapter 3.37 of the Carlsbad Municipal Code on November 15, 2005 thereby creating the Carlsbad Tourism Business Improvement District; and B. The primary purpose of the CTBID is to promote tourism and provide services to visitors to the City of Carlsbad; and C. The City Council has authorized the Board of Directors of the CTBID to conduct the business of the CTBID in the time, place and manner that best suits the needs of the Board of Directors of the CTBID, subject to-the control of federal, state and local laws governing the activities of a Business Improvement District; and D. The City Council has provided the Board of Directors with the ability to contract for services necessary to carry out the purpose of the CTBID; and E. Mindgruve is a design, branding and marketing firm that specializes in using interactive technology for advertising and marketing businesses; and F. The CTBID requested a proposal from Mindgruve to develop a Summer Marketing Campaign to promote tourism in Carlsbad, California; and G. Mindgruve submitted a proposal for services; and H. The CTBID Board has reviewed the proposal submitted by Mindgruve and finds that the services to be provided by Mindgruve will be of benefit to the CTBID; I. Mindgruve is expected to achieve the desired results in an expedited fashion. J. Mindgruve has affirmed its willingness and ability to perform such work in the manner as further described below and in a timely manner. NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, CTBID and Mindgruve agree as follows: 1. SCOPE OF WORK CTBID retains Mindgruve to perform, and Mindgruve agrees to render, those services (the "Services") that are defined in attached Exhibit "A", which is incorporated by this reference in accordance with this Agreement's terms and conditions. In addition to those Services set forth in Exhibit A, Mindgruve representatives shall present status reports/presentations to the CTBID Board of Directors as requested. Notwithstanding status reports/presentations to the Board, Mindgruve shall provide monthly written status reports to CTBID staff. CTBID Attorney Approved Version #11.28.06 2. STANDARD OF PERFORMANCE While performing the Services, Mindgruve will exercise the reasonable professional care and skill customarily exercised by reputable members of Contractor's profession practicing in the Metropolitan Southern California Area, and will use reasonable diligence and best judgment while exercising its professional skill and expertise. 3. TERM The term of this Agreement will be effective for a period of 120 days from the Effective Date first above written. This Agreement may be extended for a period up to one (1) additional year or any part thereof, with the written consent of both parties. 4. TIME IS OF THE ESSENCE AND SCHEDULING Mindgruve shall be responsible for developing, coordinating, and maintaining a work flow schedule. The initial Schedule is attached hereto as Exhibit B and is incorporated herein by this reference. Since time is of the essence for each and every provision of this Agreement, Mindgruve shall provide an updated schedule at the beginning of each month following the Effective Date of this Agreement or sooner if requested by CTBID staff. All versions of Mindgruve's Schedule shall show work proposed, worked pending, and work completed. 5. COMPENSATION The total fee payable for the Services to be performed during the Agreement term shall not exceed Two Hundred and Fifty Thousand dollars ($250,000) provided that the following conditions subsequent are met: 1. That the City Council receives, accepts and appropriates the sum of $50,000 from NRG. 2. That the City Council grants and the CTBID accepts the sum of $100,000. Both grants shall be completed by June 1, 2009 unless extended by action of the City Council. If such conditions are not satisfied the contractor will not bill and the CTBID shall not be obligated for any amounts exceeding the amounts calculated under this paragraph. The above includes all fees and costs associated with the Endless Summer Marketing Campaign. Mindgruve shall invoice the CTBID on a "time and materials" basis recognizing that the entire budget for the Endless Summer Marketing Campaign shall not exceed Two Hundred and Fifty Thousand dollars ($250,000). Mindgruve's hourly fee shall be $125.00 per hour. Mindgruve will invoice the CTBID monthly. Each invoice shall be detailed setting forth the nature of the service and the time spent, rounded to the nearest quarter-hour. No other compensation for the Services will be allowed except for items covered by subsequent amendments to this Agreement. The Contract shall be divided into two phases. The first 45 days called Phase I and the next 45 days or balance of the term of the Contract, called Phase II. Contractor shall perform all work in Phase I and then report to the Board at that time and shall not proceed to Phase II unless and until CTBID Attorney Approved Version #11.28.06 approved by the Board and ordered to proceed. The Contractor shall be paid for all time and materials in Phase I. The CTBID will timely process Mindgruve's invoices for payment and uncontested charges will be paid within 15 business days. Contested charges, if any will be resolved pursuant to Section 19 below. CTBID reserves the right, but not the obligation, to withhold a ten percent (10%) retention until CTBID has accepted the work and/or Services specified in Exhibit "A". Mindgruve has included in Exhibit A good-faith estimated third party expense. In the event that a budgeted third party expense is less than what has been estimated, Mindgruve shall transfer the excess monies into a separate "contingency" account. This contingency account may be used for other Exhibit A Tasks, with the CTBID Board's approval. Mindgruve will advise the CTBID Board of any available monies held in the contingency fund. 6. STATUS OF CONTRACTOR Mindgruve will perform the Services in Mindgruve's own way as an independent contractor and in pursuit of Contractor's independent calling, and not as an employee or agent of CTBID. Mindgruve will be under control of CTBID only as to the result to be accomplished, but will consult with CTBID as necessary. The persons used by Mindgruve to provide services under this Agreement will not be considered employees or agents of CTBID for any purposes. The payment made to Mindgruve pursuant to the Agreement will be the full and complete compensation to which Mindgruve is entitled. CTBID will not make any federal or state tax withholdings on behalf of Mindgruve or its agents, employees or subcontractors. CTBID will not be required to pay any workers' compensation insurance or unemployment contributions on behalf of Mindgruve or its employees or subcontractors. Mindgruve agrees to indemnify CTBID within thirty (30) days for any tax, retirement contribution., social security, overtime payment, unemployment payment or workers' compensation payment which CTBID may be required to make on behalf of Mindgruve or any agent, employee, or subcontractor of Mindgruve for work done under this Agreement. At the CTBID's election, CTBID may deduct the indemnification amount from any balance owing to Mindgruve. 7. SUBCONTRACTING Mindgruve will not subcontract any portion of the Services without prior written approval of CTBID. If CTBID provides its written consent for subcontracting, Mindgruve shall provide a copy of the contract and all invoices between Mindgruve and said subcontractor to CTBID staff. If Mindgruve subcontracts any of the Services, Mindgruve will be fully responsible to CTBID for the acts and omissions of Mindgruve's subcontractor and of the persons either directly or indirectly employed by the subcontractor and affiliate with the Carlsbad DMO project, as Mindgruve is for the acts and omissions of persons directly employed by Mindgruve. Nothing contained in this Agreement will create any contractual relationship between any subcontractor of Mindgruve and CTBID. Mindgruve will be responsible for payment of subcontractors. CTBID Attorney Approved Version #11.28.06 Mindgruve will bind every subcontractor and every subcontractor of a subcontractor by the terms of this Agreement applicable to Mindgruve's work unless specifically noted to the contrary in the subcontract and approved in writing by CTBID. Mindgruve has identified and designated Nielsen Claritas as a subcontractor who will be performing a portion of the Services identified in Exhibit A. CTBID consents to this designation of Nielsen Claritas as a subcontractor of Mindgruve. 8. INDEMNIFICATION FOR INTELLECTUAL PROPERTY INFRINGEMENT Mindgruve agrees to defend, indemnify and hold harmless CTBID and City of Carlsbad, its elected officials, employees and agents from and against any claim, action, proceeding, liability, loss, damage, cost or expense, including, without limitation, reasonable attorneys' fees, as provided herein, arising out of any claim that the Mindgruve's work product, products, services and/or deliverables, or any part of them, infringes upon or otherwise violates any copyright, trade secret, trademark, service mark, patent, invention, proprietary information, or other rights of any third party, or that CTBID's use of them otherwise violates this Section [collectively referred to for purposes of this Section as "Infringement Claims(s)"], by paying all amounts that a court finally awards or that Mindgruve agrees to in settlement of such Infringement Claim(s), as well as any and all expenses or charges arising from such Infringement Claim(s), including reasonable attorneys' fees, as they are incurred by CTBID or any other party indemnified under this Section. CTBID also agrees that, if the use or operation of the Mindgruve's work products, products, services and/or deliverables, or any part of them, becomes, or in Mindgruve's opinion is likely to become, the subject of an Infringement Claim(s), CTBID will permit Mindgruve, at Mindgruve's option and expense for all associated costs, either to procure the right for CTBID to continue to use Mindgruve's work products, products, services and/or deliverables, or part thereof, or to replace or modify them with another item of comparable quality and performance capabilities to become non-infringing, provided such replacement or modification does not cause the product, services and/or deliverables, or any part thereof, to fail to comply with any of the requirements of this Agreement, including but not limited to, all functionality, technical specifications and performance warranties. In the event CTBID's ongoing use of Mindgruve's work products, products, services and/or deliverables, or any part of them, is the subject of any act by a third party arising from an Infringement Claim that would preclude or impair CTBID's use of Mindgruve's work products, products, services and/or deliverables (e.g., injunctive relief), or if CTBID's continued use of them may subject it to punitive damages or statutory penalties, CTBID shall give written notice to Mindgruve of such fact(s). Upon notice of such facts, Mindgruve shall procure the right for CTBID to continue to use the work products, products, services and/or deliverables, or part thereof, or replace or modify the work products, products, services and/or deliverables of comparable quality and performance capabilities to become non-infringing. CTBID Attorney Approved Version #11.28.06 If Mindgruve fails to complete the remedial acts set forth above within thirty (30) calendar days of the date of the written notice from CTBID, CTBID shall have the right to take such remedial acts it determines to be reasonable to mitigate any impairment of its use of Mindgruve's work products, products, services and/or deliverables or damages (hereafter referred to as "CTBID's Remedial Acts"). Mindgruve shall indemnify CTBID for all amounts paid and direct and indirect costs associated with CTBID's Remedial Acts. Failure by Mindgruve to pay such amounts within ten (10) calendar days of invoice by CTBID shall, in addition to and cumulative to all other remedies, entitle CTBID to immediately withhold payments due Mindgruve under this Agreement up to the amount paid in connection with CTBID's Remedial Acts. 9. INDEMNIFICATION Mindgruve agrees to indemnify and hold harmless the CTBID and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses including attorneys fees arising out of the performance of the work described herein caused by any negligence, recklessness, or willful misconduct of the Mindgruve, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable. The parties expressly agree that any payment, attorney's fee, costs or expense CTBID incurs or makes to or on behalf of an injured employee under the CTBID's self- administered workers' compensation is included as a loss, expense or cost for the purposes of this section, and that this section will survive the expiration or early termination of this Agreement. 10. BUSINESS LICENSE Mindgruve and all authorized subcontractors will obtain and maintain a City of Carlsbad Business License for the term of the Agreement, as may be amended from time-to-time. 11. INSURANCE Contractor will obtain and maintain for the duration of the Agreement and any and all amendments, insurance against claims for injuries to persons or damage to property which may arise out of or in connection with performance of the services by Contractor or Contractor's agents, representatives, employees or subcontractors. With the exception of Professional Liability, the insurance will be obtained from an insurance carrier admitted and authorized to do business in the State of California and have a current Best's Key Rating of not less than "A-:V". 11.1 Coverages and Limits. Contractor will maintain the types of coverages and minimum limits indicated below, unless General Counsel or City Manager of Carlsbad approves a lower amount. These minimum amounts of coverage will not constitute any limitations or cap on Contractor's indemnification obligations under this Agreement. City of Carlsbad, CTBID, its officers, agents and employees make no representation that the limits of the insurance specified to be carried by Contractor pursuant to this Agreement are CTBID Attorney Approved Version #11.28.06 adequate to .protect Contractor. If Contractor believes that any required insurance coverage is inadequate, Contractor will obtain such additional insurance coverage, as Contractor deems adequate, at Contractor's sole expense. 11.1.1 Commercial General Liability Insurance. $1,000,000 combined single-limit per occurrence for bodily injury, personal injury and property damage. If the submitted policies contain aggregate limits, general aggregate limits will apply separately to the work under this Agreement or the general aggregate will be twice the required per occurrence limit. 11.1.2 Automobile Liability (if the use of an automobile is involved for Contractor's work for City). $1,000,000 combined single limit per accident for bodily injury and property damage. 11.1.3 Workers' Compensation and Employer's Liability. Workers' Compensation limits as required by the California Labor Code and Employer's Liability limits of $1,000,000 per accident for bodily injury. Workers' Compensation and Employer's Liability insurance will not be required if Contractor has no employees and provides, to City of Carlsbad's and CTBID's satisfaction, a declaration stating this. 11.1.4 Professional Liability. Errors and omissions liability insurance appropriate to Contractor's profession with limits of not less than $1,000,000 per claim. Coverage must be maintained for a period of three years following the date of completion of the work. 11.2. Additional Provisions. Contractor will ensure that the policies of insurance required under this Agreement contain, or are endorsed to contain, the following provisions: 11.2.1 The City of Carlsbad and CTBID will be named as an additional insured on General Liability. 11.2.2 Contractor will obtain occurrence coverage, excluding Professional Liability, which will be written as claims-made coverage. CTBID Attorney Approved Version #11.28.06 11.2.3 This insurance will be in force during the life of the Agreement and any extensions of it and will not be canceled without thirty (30) days prior written notice to City of Carlsbad and CTBID pursuant to the Notice provisions of this Agreement. 11.3 Providing Certificates of Insurance and Endorsements. Prior to CTBID's execution of this Agreement, Contractor will furnish certificates of insurance and endorsements to CTBID. 11.4 Failure to Maintain Coverage. If Contractor fails to maintain any of these insurance coverages, then CTBID will have the option to declare Contractor in breach of this Agreement and may immediately terminate the Agreement. 12. ACCOUNTING RECORDS Mindgruve will maintain complete and accurate records with respect to costs incurred under this Agreement. All records will be clearly identifiable. With forty-eight (48) hour advanced notice to Mindgruve, Mindgruve will allow a representative of CTBID during normal, Monday through Friday, business hours to examine, audit, and make transcripts or copies of records and any other documents created pursuant to this Agreement. Mindgruve will allow reasonable inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 13. OWNERSHIP OF DOCUMENTS Excepting such items which are specifically identified by Mindgruve as proprietary trade secrets, any and all sketches, drawings, tracings, field survey notes, computations, detail, and other materials and documents prepared by Mindgruve in the performance of this Agreement shall be the property of CTBID from the moment of their preparation, and Mindgruve shall deliver such materials and documents to CTBID, as part of this Agreement or upon request. Mindgruve shall have the right to make a duplicate copy of such materials and documents for its own file or for other purposes that CTBID may agree as to in writing. 14. COPYRIGHTS. TITLE AND ASSIGNMENT Mindgruve and CTBID intend this to be an Agreement for Services and each considers the deliverable product (Work) and results of the Services to be rendered by Mindgruve hereunder to be a work made-for-hire. Mindgruve acknowledges and agrees that the Work (and all rights therein, including, without limitation, copyright(s), trademark(s), service mark(s), etc.) belongs to and shall be the sole and exclusive property of CTBID. If for any reason the Work would not be considered a work made-for-hire under applicable law, Mindgruve does hereby assign and transfer to CTBID, its successors and assigns, the entire right, title and interest in and to the copyright in the Work and any registrations and copyright applications relating thereto and any renewals and CTBID Attorney Approved Version #11.28.06 extensions thereof, and in and to all works based upon, derived from, or incorporating the Work, and in and to all income, royalties, damages, claims and payments now or hereafter due or payable with respect thereto, and in and to all causes of action, either in law or in equity for past, present, or future infringement based on the copyright(s), trademark(s), service mark(s) and in and to all rights corresponding to the foregoing throughout the world. If the Work is one to which the provisions of 17 U.S.C. 106A apply, the Mindgruve hereby waives and appoints CTBID to assert on the Mindgruve's behalf the Mindgruve's moral rights or any equivalent rights regarding the form or extent of any alteration to the derivative works based on the Work, including, without limitation, photographs, drawings or other visual reproductions or the Work, in any medium, for CTBID purposes. Mindgruve agrees to execute all required documents and to perform such other proper acts, as City may deem necessary to secure for CTBID or its designee the rights herein assigned. 15. NOTICES The name of the persons who are authorized to give written notices or to receive written notice on behalf of CTBID and on behalf of Mindgruve under this Agreement. For CTBID: Name: Cheryl Gerhardt Title: CTBID Staff Department: Administrative Services City of Carlsbad 1635 Faraday Ave. Carlsbad, CA 92008 Phone No.: 760.434.2809 For Mindqruve. Inc.: Name: Chad Robley Title: President Address: 1018 Eighth Avenue San Diego, CA92101 Phone No.: 619.757.1325 x222 Each party will notify the other immediately of any changes of address that would require any notice or delivery to be directed to another address. 16. CONFLICT OF INTEREST CTBID will evaluate Mindgruve's duties pursuant to this Agreement to determine whether disclosure under the Political Reform Act and CTBID's Conflict of Interest Code is required of Mindgruve or any of Mindgruve's employees, agents, or subcontractors. Should it be determined that disclosure is required, Mindgruve or Mindgruve's affected employees, agents, or subcontractors will complete and file with the CTBID Clerk those schedules specified by CTBID and contained in the Statement of Economic Interests Form 700. Mindgruve, for Contractor and on behalf of Mindgruve's agents, employees, subcontractors and consultants warrants that by execution of this Agreement, that they have no interest, present or contemplated, in the projects affected by this Agreement. Mindgruve further warrants that neither Mindgruve, nor Mindgruve's agents, employees, subcontractors and consultants have any ancillary real property, business interests or CTBID Attorney Approved Version #11.28.06 income that will be affected by this Agreement or, alternatively, that Mindgruve will file with the CTBID an affidavit disclosing this interest. 17. GENERAL COMPLIANCE WITH LAWS Mindgruve will keep fully informed of federal, state and local laws and ordinances and regulations which in any manner affect those employed by Mindgruve, or in any way affect the performance of the Services by Mindgruve. Mindgruve will at all times observe and comply with these laws, ordinances, and regulations and will be responsible for the compliance of Mindgruve's services with all applicable laws, ordinances and regulations. Mindgruve will be aware of the requirements of the Immigration Reform and Control Act of 1986 and will comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and consultants that the services required by this Agreement. 18. DISCRIMINATION AND HARASSMENT PROHIBITED Mindgruve will comply with all applicable local, state and federal laws and regulations prohibiting discrimination and harassment. 19. DISPUTE RESOLUTION If a dispute should arise regarding the performance of the Services the following procedure will be used to resolve any questions of fact or interpretation not otherwise settled by agreement between the parties. Representatives of Mindgruve or CTBID will reduce such questions, and their respective views, to writing. A copy of such documented dispute will be forwarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The representative receiving the letter will reply to the letter along with a recommended method of resolution within ten (10) business days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outlining the disputes will be forwarded to the Carlsbad City Manager. The City Manager will consider the facts and solutions recommended by each party and may then opt to direct a solution to the problem. In such cases, the action of the City Manager will be binding upon the parties involved, although nothing in this procedure will prohibit the parties from seeking remedies available to them at law. 20. TERMINATION In the event of the Mindgruve's failure to prosecute, deliver, or perform the Services, CTBID may terminate this Agreement for nonperformance by notifying Mindgruve by certified mail of the termination. If CTBID. decides to abandon or indefinitely postpone the work or services contemplated by this Agreement, CTBID may terminate this Agreement upon written notice to Mindgruve. Upon notification of termination, Mindgruve has five (5) business days to deliver any documents owned by CTBID and all work in progress to CTBID address contained in this Agreement. CTBID will make a determination of fact based upon the work product delivered to CTBID and of the CTBID Attorney Approved Version #11.28.06 percentage of work that Mindgruve has performed in compliance with the Agreement. Based upon that finding CTBID will determine the final payment of the Agreement. Either party upon tendering thirty (30) days written notice to the other party may terminate this Agreement. In this event and upon request of CTBID, Mindgruve will assemble the work produce and put it in order for poper filing and closing and deliver it to CTBID. Mindgruve will be paid for work performed to the termination date; however, the total will not exceed the lump sum fee payable under this Agreement. CTBID will make the final determination as to the portions of tasks completed and the compensation to be made. 21. COVENANTS AGAINST CONTINGENT FEES Mindgruve warrants that Mindgruve has not employed or retained any company or person, other than a bona fide employee working for Mindgruve, to solicit or secure this Agreement, and that Mindgruve has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this Agreement. For breach or violation of this warranty, CTBID will have the right to annul this Agreement without liability, or, in its discretion, to deduct from the Agreement price or consideration, or otherwise recover, the full amount of the fee, commission, percentage, brokerage fees, gift, or contingent fee. 22. CLAIMS AND LAWSUITS By signing this Agreement, Mindgruve agrees that any Agreement claim submitted to CTBID must be asserted as part of the Agreement process as set forth in this Agreement and not in anticipation of litigation or in conjunction with litigation. Mindgruve acknowledges that if a false claim is submitted to CTBID, it may be considered fraud and Mindgruve may be subject to criminal prosecution. Mindgruve acknowledges that California Government Code sections 12650 et seq.. the False Claims Act applies to this Agreement and, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If CTBID seeks to recover penalties pursuant to the False Claims Act, it is entitled to recover its litigation costs, including attorney's fees. Mindgruve acknowledges that the filing of a false claim may subject Mindgruve to an administrative debarment proceeding as the result of which Mindgruve may be prevented to act as a Mindgruve on any public work or improvement for a period of up to five (5) years. Mindgruve acknowledges debarment by another jurisdiction is grounds for CTBID to terminate this Agreement. 23. JURISDICTIONS AND VENUE Any action at law or in equity brought by either of the parties for the purpose of enforcing a right or rights provided for by this Agreement will be tried in a court of competent jurisdiction in the County of San Diego, State of California, and the parties waive all provisions of law providing for a change of venue in these proceedings to any other county. CTBID Attorney Approved Version #11.28.06 10 24. SUCCESSORS AND ASSIGNS It is mutually understood and agreed that this Agreement will be binding upon CTBID and Mindgruve and their respective successors. Neither this Agreement nor any part of it nor any monies due or to become due under it may be assigned by Mindgruve without the prior consent of CTBID, which shall not be unreasonably withheld. 25. ENTIRE AGREEMENT This Agreement, together with any other written document referred to or contemplated by it, along with the purchase order for this Agreement and its provisions, embody the entire Agreement and understanding between the parties relating to the subject matter of it. In case of conflict, the terms of the Agreement supersede the purchase order. Neither this Agreement nor any of its provisions may be amended, modified, waived or discharged except in a writing signed by both parties. 26. AUTHORITY The individuals executing this Agreement and the instruments referenced in it on behalf of Mindgruve each represent and warrant that they have the legal power, right and actual authority to bind Mindgruve to the terms and conditions of this Agreement. MINDGRUVE, INC.CT crobley@mindgruve.com (e-mail address) ORR^INE 'CTBlDCIerk (print name/title) (e-mail address) If required by CTBID, proper notary acknowledgment of execution by contractor must be attached. If a Corporation. Agreement must be signed by one corporate officer from each of the following two groups. *Group A. **Group B. Chairman, Secretary, President, or Assistant Secretary, Vice-President CFO or Assistant Treasurer CTBID Attorney Approved Version #11.28.06 APPROVED AS TO FQPm 11 EXHIBIT A mindgruve Carlsbad BID/DMO 2009 Summer Campaign Overview Duration The following recommendations are based on accomplishing the goals & objectives outlined below over a (3) month term starting June 1, 2009 through August 31, 2009. Budget $250,000 Target Los Angeles and Orange County Method Paid Search, Online Banners, Direct Mail, Email Marketing, Targeted Microsite Strategy Mindgruve to work directly with hotels in Carlsbad with the goal of 20 irresistible summer deals. Paid search and online banners will drive traffic to a "convertible" microsite. Hotel rooms will be booked on the the microsite with confirmation to come directly from the hotel to the customer. There will be NO booking fees to allow for the best possible deals. Scope of Work and Deliverables Pay-Per-Click Advertising- Yahoo & Google- Not to Exceed $87,500 Based on a (3) month term. Key search terms that drive travel and destination leads at a time of need directly to our niched microsite and/or our Carlsbad Tourism Partners. Pay-Per-Click Strategy will be done by Mindgruve Pay-Per-Click Campaign will proceed per Schedule, Exhibit B Pay-Per-Click Advertising placement "TBD" with Board approval and shall not exceed $74,375 Project Estimate 105 hours EXHIBIT A mindgruve Online Banner Advertising- Not to Exceed $50,000 Mindgruve will develop and design Carlsbad DMO Banner Ads for key family travel websites that geotarget Los Angeles and Orange County. Mindgruve will provide the mockups of the Online Banner Ads to the CTBID Board for its consideration and approval. Online Banner Creative, Design, Production and Media Placement will be done by Mindgruve Online Banner Advertising will proceed per Schedule, Exhibit B Online Banner Advertising placement "TBD" with Board approval and shall not exceed $42,500 Project Estimate 60 hours Direct Mail- Not to Exceed $25,000 Mindgruve will develop, design, produce and deploy one (1) targeted direct mail piece that supports our Hotel & Resort Summer Packages and Microsite. Direct Mail will be done by Mindgruve Direct Mail will proceed per Schedule, Exhibit B Direct Mail Production and Deployment "TBD" with Board approval and shall not exceed $20,000 Project Estimate 40 hours Email Marketing- Not to Exceed $25,000 Based on 3 month term. Series of targeted emails that support our Hotel & Resort Summer Packages and Microsite. 1 Email per week, 12 total. Email Marketing Design will be done by Mindgruve Email Marketing Campaign will proceed per Schedule, Exhibit B Email Marketing Target Lists and Deployment Fees "TBD" with Board approval shall not exceed $10,000 Project Estimate 120 hours Summer Package Development- Not to Exceed $8,000 Mindgruve will work with Hotels, Resorts and Theme Parks to formalize Internet special summer packages, promotions, and coops. Tourism Package Development will be done by Mindgruve Tourism Package Development will proceed per Schedule, Exhibit B Project Estimate 64 hours EXHIBIT A mindgruve Microsite Design & Programming- Not to Exceed $15,000 Based on one (1) microsite campaign linked to key word domains for specific summer travel package sales and promotions. Microsite Design & Programming will be done by Mindgruve Microsite Design & Programming will proceed per schedule, Exhibit B Project Estimate 120 hours Campaign Measurement- Not to Exceed $6,000 Entire Advertising Campaign will be measured on a monthly basis including web traffic, conversions, open rates, click thru's, affiliates, channel partners, etc. Campaign Measurement will be done by Mindgruve Campaign Measurement will start June 1, 2009 on a weekly basis. Project Estimate 48 hours (16 hours per month, 4 hours per week) Campaign Project Management- Not to Exceed $33,500 This budget includes the monthly management fee for the account manager, project managers, account communications, meetings, and ongoing campaign strategy. Campaign Project Management will be done by Mindgruve Campaign Project Management will start June 1, 2009 Project Estimate 268 (90 hours per month, approximately 22.5 hours per week) Mindgruve will provide Carlsbad BID/DMO monthy progress reports Contact Information CHAD ROBLEY PRESIDENT crobley@mindgruve.com 1018 EIGHTH AVE SAN DIEGO, CA 92101 mindgruve.com I 619.757.1325x222 EXHIBIT A mindgruve MICHAEL GARTEN SVP, BUSINESS DEVELOPMENT mqartenfamindqruve.com 18851 BARDEEN AVENUE IRVINE. CA92612 mindgruve.com 949.955.9221 x2 Exhibit B Carlsbad BID/DMO 2009 Summer Campaign Project Timeline June 1, 2009 - August 31, 2009 Task 1 - Pay-Per-Click Advertising- Yahoo & Google Pay-Per-Click Campaign will launch June 15, 2009 Task 2 - Online Banner Advertising Online Banner Advertising will launch June 15, 2009 Task 3 - Direct Mail Direct Mail Campaign will start June 1, 2009 Task 4 - Email Marketing Email Marketing Campaign will launch June 15, 2009 Task 5 - Tourism Package Development Tourism Package Development will start June 1, 2009 and be completed by July 1, 2009 Task 6 - Microsite Design & Programming Microsite Design & Programming will launch June 15, 2009 Task 7 - Campaign Measurement Campaign Measurement will start June 1, 2009 (Daily, Weekly, Monthly) Task 8 - Campaign Project Management Campaign Project Management will start June 1, 2009