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MOCA Chooses the Broad Option (UPDATED 2X)

By Intellectual Property Law, Esq.

News out of Los Angeles this morning that "the board of the financially strapped Museum of Contemporary Art has voted to accept a $30-million bailout offer from billionaire philanthropist Eli Broad":

"The Broad deal, to be announced Tuesday, ends speculation that the museum might opt to accept a merger offer made last week by the Los Angeles County Museum of Art. According to the agreement, the Eli and Edythe Broad Foundation will match contributions to MOCA?s endowment up to $15 million and provide $3 million a year for exhibition support for five years. ... Broad said he was not requiring MOCA to raise $15 million in matching funds in order to receive the $15-million challenge grant but rather would match endowment funds 'dollar for dollar' with what MOCA was able to raise from trustees and others, with a cap of $15 million. ... The agreement also includes a 90-day window to 'allow any responsible party to replace the Broad Foundation on identical terms.' ... MOCA board co-chairmen Tom Unterman and David G. Johnson said that museum trustees had pledged or promised more than $20 million in new gifts since the museum?s financial troubles became public in November. ... Broad?s agreement calls for MOCA to 'continue operating as an independent world-class contemporary art museum' and to maintain both its headquarters on Grand Avenue and the Geffen Contemporary space in Little Tokyo. The plan requires MOCA to 'keep its collection intact and not sell any works of art.' The agreement also requires MOCA to operate with an annual budget of 'no less than $13 million and no more than $16 million in cash expenses' but says that the museum may operate at a higher level if it has the cash income to do so. In recent years, the museum?s budget has averaged $20 million."

UPDATE: Christopher Knight has a nice bullet point summary of the deal.

UPDATE 2: Further thoughts on the deal from Knight here.

Full post as published by The Art Law Blog on December 23, 2008 (boomark / email).