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Cabarrus Arena Management Incentives £aa• FY2009 The management agreement between Cabarrus County and SMG outlines incentives for SMG to exceed certain performance tluesholds. This total fee is composed of a quantitative portion relating to Gross Operating Revenue and a qualitative portion relating to more subjective performance meastues. Quantitative Incentive tee For the }rear ending June 30, 2009, SMG surpassed the $784,761 Gross Operating Revenue tlueshold that triggers tl~e quantitative incentive fee. Gross Operating Revenue for the year was $1,088,031. In accordance with the management agreement, SMG should receive a quantitative incentive fee wluch is the lesser of fifteen percent of Grass Operating Revenue in excess of the threshold or an incentive cap equal to seventy»five percent of the base fee. The calculated incentive based on G $1,088,031 - 784 761 $ 303,270 x IS% $ 45,490 rosy Operating Revenue in excess of the threshold is as follows: Gross Operating Revenue Incentive Tleshold Gross Operating Revenue in Excess of Incentive Threshold Percen#age of Excess Revenue Available for Incentive Potential Incentive for FY 2009 The calculation to determine the incentive cap is: $95,000 Base Management Fee x 7S% Cap Percentage $71,250 Maximum Possible Incentive Based on these calculations and the current management agreement, the quantitative incentive fee due SMG for fiscal }rear 2009 is $45,490. Qualitative Incentive Fee For the fiscal year ending 3rane 30, 2009, Cabarrus County staff awarded SMG ninety-five of a possible one hundred points in the subjective performance areas of customer service, maintenance and operations, and overall management. Applying the formulas outlined in the management agreement results in a qualitative incentive fee to SMG of $22,562. $23,750 Maximum Qualitative Irreerrtive per Agreement x 95% Percentage of Total Points Awarded to SMG $22,562 Qualitative Incentive Fee Due SMG F-1 Attachment number 1 Page 41