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Agenda Item Review Form
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Muskegon City Commission
Commission Meeting Date: March 8, 2022 Ti.tie: Arena Participation Agreements
Submitted By: Frank Peterson Department: City Manager
Brief Summary: Staff is seeking approval of the attached participation agreements.
Detailed Summary. We have been working with the LCC to convert the arena liquor license from a
Civic Center License to a DOC license. This has been a cumbersome process, but was necessary
to properly operate Rad Dad's and Carlisle's in the space. We are in the home stretch. As part of
the change, we were required to covert the existing leases into participation agreements - this is the
appropriate term inology to match the activities at the arena. We are seeking approval.
Amount Requested : Amount Budgeted:
Fund(s) or Account(s): Fund(s) or Account(s): N/A
Recommended Motion: Approve the participation agreements for Rad Dad's Tacos and Tequila
and Carlisle's Goods and Leisure.
Agreement for Management of a Portion of a Licensed Premises
Pursuant to Participation Agreement
THIS AGREEMENT is made and executed as of
between the
M<Yv~ 3 , 2022
City of Muskegon
a Michigan municipal corporation
933 Terrace St.
Muskegon,Ml49440
(hereinafter "City of Muskegon"), and
Rad Dads', L.L.C.
a Michigan limited liability company
470 W. Western Avenue, Muskegon, Michigan 49440
Spring Lake, Ml 49456
("Rad Dads"')
RECITALS
A. The City of Muskegon owns the Mercy Health Arena located at 470 W. Western
Avenue , Muskegon, Michigan 49440 ("Arena"). The City of Muskegon is
responsible for operation, maintenance and improvements for the Arena.
B. The City of Muskegon has the authority to authorize use of portions of the Arena
on an exclusive and non-exclusive basis.
C. The City of Muskegon has applied for a Class C liquor license and related
permits issued by the Michigan Liquor Control Commission ("MLCC") for
providing a restaurant, concessions, bar and bar service throughout the Arena
premises (collectively the "License").
D. The City of Muskegon proposes entering into a Participation Agreement with Rad
Dads' pursuant to Rule 436.1401 to permit the limited use of the license, subject
to and only upon the approval of the MLCC, upon the terms and conditions of this
Agreement.
E. In connection with this Agreement, the City of Muskegon is willing to grant to Rad
Dads', and Rad Dads' desires to receive from the City of Muskegon, the
exclusive right to use and manage that portion of the Arena to be known as the
Rad Dads' Area (See attached Exhibit A) for the operation of a certain
restaurant and bar business commonly known as the "Rad Dads' Tacos and
Tequila Bar", subject to and in accordance with the terms and conditions of this
Agreement.
In consideration of the premises and the mutual promises set forth herein, the
parties agree as follows:
1. RAD DADS' PARTICIPATION AGREEMENT. Upon execution of this
Agreement, the parties agree to act in good faith and to utilize their best efforts to
make application to the MLCC for a Participation Agreement/Participation Permit
Application pursuant to Rule 436.1041. Rad Dads' will operate a full-service
restaurant, bar and bar service within the Rad Dads' Space as hereinafter
defined. The parties acknowledge that this Agreement is contingent upon and
shall only become effective upon approval of the MLCC of the Participation
Agreement/Participation Permit Application.
2. DESCRIPTION OF RAD DADS' SPACE. Rad Dads' will have the right to use
and manage the Rad Dads' Space and fixtures as follows:
a. The exclusive right to use and manage the Rad Dads' Space (depicted on
the attached Exhibit A) and the Outdoor Service Area, and a non-exclusive right
of access for Rad Dads' employees, patrons and suppliers to and from the
Restaurant Space across other portions of the Arena. Subject to City of
Muskegon approval of architectural plans, Rad Dads' has the right to construct,
at their sole cost, an outdoor deck above their outdoor patio area.
b. The limited nonexclusive right to use other areas in the Arena that would not
interfere with the management and operation of the Arena by the City of
Muskegon, excluding only the area identified as the "Rad Dads' Space" in the
Agreement for Management of a Portion of a Licensed Premises Pursuant to
Participation Agreement between the City of Muskegon and Rad Dads', LLC
(depicted on Exhibit B).
c. Notwithstanding the foregoing, during events held at the Arena when it is
open to the public, the term exclusive use shall be construed to allow patrons to
enter and leave the Rad Dads' Space and all areas of the Arena licensed by the
MLCC.
3. TERM. This Agreement shall become effective upon execution with the
contingencies provided for herein. The initial term of this Agreement shall be for
a period of five (5) years commencing with the approval of the MLCC of the
Participation Agreement/Participation Permit Application with a term extension
equal to the time from such approval to the date a certificate of occupancy is
issued by the City of Muskegon, a license is issued by the Muskegon County
Department of Health or the MLCC has approved the licensed space identified
on Exhibit A, whichever date is latest. If Rad Dads' is forced to close for more
than ten (10) days, the City of Muskegon will reimburse or credit Rad Dads'
$1,500 per day, for every day of such closer. The monthly Use Payment shall
commence on the first day of the month following such approval. In addition, Rad
Dads' shall have three (3) additional five (5) year options. In the absence of any
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other provision herein, Rad Dads' shall be provided written notice of any default
and afforded not less than sixty (60) days to cure the default. Provided that Rad
Dads' is not in material default of this Agreement at the time of expiration of the
initial term or any option term, Rad Dads' shall provide the City of Muskegon with
written notice of its intent to renew this Agreement in writing no later than sixty
(60) days prior to the expiration of the initial term and any renewal term provided,
however, that said sixty (60) days shall not begin to toll until sixty (60) days after
the City of Muskegon has provided Rad Dads' with written notice of the expiration
of the initial term or any renewal term.
4. CONSTRUCTION AND IMPROVEMENTS: USAGE. The City of Muskegon has
completed significant investments to create existing restaurant space that Rad
Dads' will occupy. Rad Dads' agrees to accept this space in "as is" condition. In
exchange for accepting the Rad Dads' space, Rad Dads' shall imediately pay
$50,000 to the City of Muskegon. Rad Dads' further agrees to pay the City of
Muskegon an additional-$4,940.53 on the 15th of each calander month, beginning
January 15, 2022, and continuing through December 15, 2031. Rad Dads' has
the right to pay down the principal at any point during the term of this agreement
in payments of at least $10,000. The debt shall be amortizated as follows:
Date Interest Principal Balance
Jan,2022 $1,627 $3,314 $484,663
Feb,2022 $1,616 $3,325 $481,338
Mar, 2022 $1,604 $3,336 $478,002
Apr, 2022 $1,593 $3,347 $474,655
May, 2022 $1,582 $3,358 $471,296
Jun,2022 $1,571 $3,370 $467,927
Jul, 2022 $1,560 $3,381 $464,546
Aug, 2022 $1,548 $3,392 $461,154
Sep,2022 $1,537 $3,403 $457,751
Oct, 2022 $1,526 $3,415 $454,336
Nov, 2022 $1,514 $3,426 $450,910
Dec, 2022 $1,503 $3,437 $447,472
2022 $18,782 $40,505 $447,472
Jan,2023 $1,492 $3,449 $444,024
Feb,2023 $1,480 $3,460 $440,563
Mar, 2023 $1,469 $3,472 $437,091
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Date Interest Principal Balance
Apr, 2023 $1,457 $3,484 $433,608
May, 2023 $1,445 $3,495 $430,112
Jun,2023 $1,434 $3,507 $426,606
Jul, 2023 $1,422 $3,519 $423,087
Aug,2023 $1,410 $3,530 $419,557
Sep,2023 $1,399 $3,542 $416,015
Oct, 2023 $1,387 $3,554 $412,461
Nov, 2023 $1,375 $3,566 $408,895
Dec, 2023 $1,363 $3,578 $405,318
2023 $17,132 $42,155 $405,318
Jan,2024 $1,351 $3,589 $401,728
Feb,2024 $1,339 $3,601 $398,127
Mar, 2024 $1,327 $3,613 · $394,513
Apr, 2024 $1,315 $3,625 $390,888
May, 2024 $1,303 $3,638 $387,250
Jun,2024 $1,291 $3,650 $383,601
Jul, 2024 $1,279 $3,662 $379,939
Aug,2024 $1,266 $3,674 $376,265
Sep,2024 $1,254 $3,686 $372,578
Oct, 2024 $1,242 $3,699 $368,880
Nov, 2024 $1,230 $3,711 $365,169
Dec, 2024 $1,217 $3,723 $361,446
2024 $15,414 $43,872 $361,446
Jan,2025 $1,205 $3,736 $357,710
Feb,2025 $1,192 $3,748 $353,962
Mar, 2025 $1,180 $3,761 $350,201
Apr, 2025 $1,167 $3,773 $346,428
May, 2025 $1,155 $3,786 $342,642
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Date Interest Principal Balance
Jun,2025 $1,142 $3,798 $338,844
Jul, 2025 $1,129 $3,811 $335,033
Aug,2025 $1,117 $3,824 $331,209
Sep,2025 $1,104 $3,837 $327,372
Oct, 2025 $1,091 $3,849 $323,523
Nov, 2025 $1,078 $3,862 $319,661
Dec, 2025 $1,066 $3,875 $315,786
2025 $13,627 $45,660 $315,786
Jan,2026 $1,053 $3,888 $311,898
Feb,2026 $1,040 $3,901 $307,997
Mar, 2026 $1,027 $3,914 $304,083
Apr, 2026 $1,014 $3,927 $300,156
May, 2026 $1,001 $3,940 $296,216
Jun,2026 $987 $3,953 $292,263
Jul, 2026 $974 $3,966 $288,297
Aug,2026 $961 $3,980 $284,317
Sep,2026 $948 $3,993 $280,325
Oct, 2026 $934 $4,006 $276,319
Nov, 2026 $921 $4,019 $272,299
Dec, 2026 $908 $4,033 $268,266
2026 $11,767 $47,520 $268,266
Jan,2027 $894 $4,046 $264,220
Feb,2027 $881 $4,060 $260,160
Mar, 2027 $867 $4,073 $256,087
Apr, 2027 $854 $4,087 $252,000
May, 2027 $840 $4,101 $247,899
Jun, 2027 $826 $4,114 $243,785
Jul, 2027 $813 $4,128 $239,657
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Date Interest Principal Balance
Aug,2027 $799 $4,142 $235,516
Sep,2027 $785 $4,155 $231,360
Oct, 2027 $771 $4,169 $227,191
Nov,2027 $757 $4,183 $223,007
Dec, 2027 $743 $4,197 $218,810
2027 $9,830 $49,456 $218,810
Jan,2028 $729 $4,211 $214,599
Feb,2028 $715 $4,225 $210,374
Mar, 2028 $701 $4,239 $206,135
Apr, 2028 $687 $4,253 $201,881
May, 2028 $673 $4,268 $197,614
Jun,2028 $659 $4,282 $193,332
Jul, 2028 $644 $4,296 $189,036
Aug,2028 $630 $4,310 $184,725
Sep,2028 $616 $4,325 $180,401
Oct, 2028 $601 $4,339 $176,061
Nov, 2028 $587 $4,354 $171,708
Dec, 2028 $572 $4,368 $167,340
2028 $7,816 $51,471 $167,340
Jan,2029 $558 $4,383 $162,957
Feb,2029 $543 $4,397 $158,559
Mar, 2029 $529 $4,412 $154,147
Apr, 2029 $514 $4,427 $149,721
May, 2029 $499 $4,441 $145,279
Jun,2029 $484 $4,456 $140,823
Jul, 2029 $469 $4,471 $136,352
Aug,2029 $455 $4,486 $131,866
Sep,2029 $440 $4,501 $127,365
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Date Interest Principal Balance
Oct, 2029 $425 $4,516 $122,849
Nov,2029 $409 $4,531 $118,318
Dec, 2029 $394 $4,546 $113)72
2029 $5,719 $53,568 $113,772
Jan,2030 $379 $4,561 $109,210
Feb,2030 $364 $4,576 $104,634
Mar, 2030 $349 $4,592 $100,042
Apr, 2030 $333 $4,607 $95,435
May, 2030 $318 $4,622 $90,813
Jun,2030 $303 $4,638 $86,175
Jul, 2030 $287 $4,653 $81,522
Aug,2030 $272 $4,669 $76,853
Sep, 2030 $256 $4,684 $72,169
Oct, 2030 $241 $4JOO $67,469
Nov, 2030 $225 $4)16 $62,753
Dec, 2030 $209 $4)31 $58,022
2030 $3,536 $55,750 $58,022
Jan,2031 $193 $4)47 $53,274
Feb, 2031 $178 $4,763 $48,511
Mar, 2031 $162 $4)79 $43,733
Apr, 2031 $146 $4,795 $38,938
May, 2031 $130 $4,811 $34,127
Jun, 2031 $114 $4,827 $29,300
Jul, 2031 $98 $4,843 $24,458
Aug,2031 $82 $4,859 $19,599
Sep, 2031 $65 $4,875 $14,723
Oct, 2031 $49 $4,891 $9,832
Nov,2031 $33 $4,908 $4,924
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Date Interest Principal Balance
Dec, 2031 $16 $4,924 $0
2031 $1,265 $58,022 $0
Subject to further MLCC approval, Rad Dads' may increase the dimensions of
the outdoor service area to further extend the space along the exterior of the Rad
Dads' space. Rad Dads' would be responsible for any costs associated with
such expansion, and such expansion would have no impact of the calculation of
monthly use payment.
Rad Dads' shall use and manage the Rad Dads' Space for purposes of operating
a sports bar and restaurant operation, including food and beverage service
preparation ("Restaurant").
5. RAD DADS' COMPENSATION. In consideration for the management and
operation of the Restaurant and the Rad Dads' Space, Rad Dads' shall retain
100% of the net profits generated from the operation of the Restaurant, including
the sale of alcoholic beverages under the License, non-alcoholic beverages,
food, merchandise and cover charges and other goods and services which would
not constitute a violation of MLCC rules. The term "net profits" as used in this
Agreement shall mean all revenue derived from the operation of the Restaurant
less all expenses related to the operation of the Restaurant. During the term of
this Agreement, at the request of the City of Muskegon, Rad Dads' shall deliver
to the City of Muskegon an income statement certified by an officer or manager
of Rad Dads' setting forth its net profits. In the event the City of Muskegon, in its
sole discretion, needs additional information to clarify information, Rad Dads' will
grant to the City of Muskegon the right to have access to all books, accounts,
records and reports, that may be kept by Rad Dads' showing all financial
information related to the operation of the Restaurant. If a review discloses any
discrepancy in the net profits, the parties shall mutually agree on a Certified
Public Accountant to review the financial statements and records of Rad Dads'
and determine the net profits. Such determination shall be binding on the parties.
City agrees that any financial information provided will be directed to the City
Attorney and not shared with any other City employees unless as absolutely
necessary.
In further consideration for the management and operation of the Restaurant and
the Rad Dads' Space, Rad Dads' shall have the ability to host special events in
the the Arena. The events shall follow the City of Muskegon's established policy
for hosting a third-party event, with the exception that Rad Dads' will not pay a
facility rental fee and their event attendees will not pay a ticketing fee unless the
event charges attendees in excess of $15 per attendee. Rad Dads' will pay for
all labor and expenses necessary for hosting any third-party event. Rad Dads'
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ability to host a third-party event shall be limited to availability of the Arena.
Availability shall be at the discretion of the City of Muskegon. Rad Dads' is
limited to hosting three one-day third-party events in a calander year.
6. CALCULATION OF MONTHLY USE PAYMENT; CREDIT. In consideration of
this Agreement, Rad Dads' shall pay monthly Use Payment to the City of
Muskegon in an amount equal to 4,750; provided, however, that beginning with
the sixth year, the base use payment will increase to $5,000, and beginning with
the 11 th year, the base use payment will increase to $5,250, and and beginning
with the 16th year, the base use payment will increase to $5,500.
The City of Muskegon agrees to host a minimum of 40 game days in a calander
year. A single regular season or post-season professional sports game shall
constitute a game day. Additionally, an amateur sports tournament consisting of
a minimum of six (6) amateur games in a day shall consititue a game day. In the
event the Arena hosts less than 30 game days in a calander year, Rad Dads'
shall have the option to cancel this Agreement with 30 days' notice to the City of
Muskegon.
The City of Muskegon may host events that require the temporary closure of Rad
Dads'. In the event that Arena events require the closure of Rad Dads' for non-
ticketed events in excess of 20 hours in a calander year, Rad Dads' shall receive
a Use Payment credit of $250 for each hour of closure in excess of 20 hours. In
the event that Arena requires the closure of Rad Dad's for ticketed events such
as concerts and other shows, Rad Dad's may request that the City reimburse
Rad Dads' with $1.00 per ticket from the ticket service fees. City will add the
$1.00 per ticket fee to any ticket sold for such event.
7. ADJUSTMENT OF MONTHLY USE PAYMENT. The monthly Use Payment
shall be adjusted upon the following events and upon the following terms:
i. Professional Hockey, Football, and Soccer Games. Rad Dads' will work
with the Arena's professional hockey, football, and soccer tenants, at its sole
discretion, to compensate the tenants for partnerships during their ticketed
events. In the event that Rad Dads' is unable to reach partnership agreement
with one or more of the these tenants, the additional monthly use payments \Viii
be implemented as follows: on days when professional hockey,football, or
soccer games take place in the Arena, the Use Payment shall be increased and
adjusted in the amount of $500 per Hockey event day and $400 per Football and
Soccer event day. Rad Dads will purchase 25 sets of season tickets from the
Muskegon Lumberjacks per season. Rad Dads' will pay the West Michigan
lronmen $500 per home game in the form of a gift card in exchange for hosting
the official after party at Rad Dad's on game days. Rad Dads' will purchase$200
worth of game tickets from the Muskegon Risers per home game.
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ii. Suspension of Liquor License. In the event that the License issued by the
MLCC shall be suspended for reasons other than rule violations by Rad Dad's or
its patrons, Use Payments shall be suspended pro rata during such suspension
term.
8. CONTRIBUTION TO OVERHEAD AND MAINTENANCE. Rad Dads' shall also
pay to the City of Muskegon a contribution for overhead common utilities and
maintenance an amount equal to $1,500.00 per month. This contribution shall be
paid in the form of a Use Credit identified in Paragraph 6 herein until such time
as the Use Credit is fully amortized.
9. UTILITY COSTS. As part of the Contribution to Overhead and Maintenance
identified in Section 8 of this agreement, the City of Muskegon shall pay all
charges for metered gas, electricity, water, power, cable television, and internet
service rendered or supplied upon or in connection with the Rad Dads' Space.
Rad Dads' shall pay all charges for telephone service used in connection with the
Rad Dads' Space.
10. ASSIGNMENT. Rad Dads' shall not assign this Agreement without prior written
consent of the City of Muskegon and the MLCC. Such approval and consent
shall not unreasonably be withheld by the City of Muskegon and shall be subject
to the rules and regulations of the MLCC.
11. OBLIGATIONS OF THE CITY OF MUSKEGON. To the extent required by
MLCC rules, the City of Muskegon shall purchase all alcoholic and food inventory
to be used by the Restaurant. The City of Muskegon shall furnish "janitorial
services" for the exterior of the building and in lobby areas and restrooms used
by the public, exclusive of those areas used and managed by Rad Dads'. The
City of Muskegon agrees to maintain in satisfactory working order, all public ways
and structures of the Arena, including plate glass, roof, and outer walls and
heating, electrical and plumbing supply sites, air conditioning and hot water
supply units. The City of Muskegon agrees to allow use of its dumpsters by Rad
Dads', and the cost of such service shall be included in Section 8 of this
Agreement. The City of Muskegon agrees to be responsible for any structural
repairs, replacements or changes in the Arena which affect the Rad Dads'
Space.
12. OBLIGATIONS OF RAD DADS'. Rad Dads' shall reimburse the City of
Muskegon for all alcoholic and food inventory purchased by the City of Muskegon
for the Restaurant within 30 days of receipt of an invoice from the City of
Muskegon. Rad Dads' agrees that it will pay all expenses in connection with the
use and management of the Rad Dads' Space and fixtures, including, but not
limited to, all rights and privileges granted, including all metered utility services
(e.g. electrical, water and sewer service) and all taxes, permits, fees, license fees
and assessments lawfully levied or assessed upon Rad Dads' personal property
or upon its use of possession of the Rad Dads' Space and fixtures. Except for
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the License, Rad Dads' agrees to secure all permits and licenses required
related to its use of the Rad Dads' Space.
Rad Dads' agrees that it will at all times maintain the Rad Dads' Space and
fixtures in a neat, clean, safe, sanitary and orderly condition, and shall provide
janitorial services with respect thereto. Rad Dads' shall provide for the sanitary
handling and disposal of trash and other refuse from its operation in a manner
satisfactory to the City of Muskegon.
Rad Dads' will make no structural changes or additions to the Rad Dads' Space
without first obtaining written approval from the City of Muskegon.
Rad Dads' agrees to provide and pay for any and all decorations to the Rad
Dads' Space. Rad Dads' shall provide the following services from the Rad Dads'
Space at all times during the term of this Agreement at its sole cost and expense:
a. Rad Dads' shall furnish, at its expense, all service equipment of every sort
(such as silverware, linen, glassware, crockery, utensils, pots and pans, and
additional equipment), which may be required for use in Rad Dads' operation and
which is not already presently located in the Rad Dads' Space.
b. Rad Dads' shall undertake to comply with all MLCC rules.
c. Rad Dads' shall cooperate with the City of Muskegon in securing all
permits and licenses required by any public agency, including the License issued
by the MLCC in connection with the operation of the Arena as a sports and
entertainment venue.
d. Rad Dads' shall carry workers compensation insurance in the amounts
required by state law for all employees hired by Rad Dads' to work in the Rad
Dads' Space.
13. ORDINANCES AND STATUTES. Rad Dads' shall comply with all statutes,
ordinances and requirements of all municipal, state and federal authorities now in
force or which may be in force, pertaining to the premises, occasioned by or
affecting the use there of by Rad Dads'. The commencement or pendency of
any state or federal court abatement proceeding affecting the use of the Rad
Dads' Space shall, at the option of the City of Muskegon, be deemed a breach
hereof. The City of Muskegon represents and warrants that the Arena shall be in
compliance with the Americans with Disabilities Act, and its regulation, as of the
commencement of this Agreement.
14. MAINTENANCE, REPAIRS, ALTERATIONS. Rad Dads' shall, at its expense
and at all times, maintain the Rad Dads' Space in good and safe condition,
including plate glass, electrical wiring, plumbing and heating installations. Rad
Dads' shall also maintain in good condition such portions adjacent to the Arena
within the Rad Dads' Space, such as sidewalks, driveways, lawns and shrubbery.
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15. ENTRY AND INSPECTION. Rad Dads' shall permit the City of Muskegon or the
City of Muskegon's agents to enter upon the Rad Dads' Space at reasonable
times for the purpose of performing maintenance and making repairs and
replacement in any case where the City of Muskegon is obligated, and in any
other case where the City of Muskegon determined that it was necessary to do
so in order to preserve the structural safety of the Rad Dads' Space to correct
any condition likely to cause injuries or damages to persons or property.
16. DAMAGE OR DESTRUCTION OF PREMISES. If by reason of any cause the
Rad Dads' Space is damaged to such an extent that the Rad Dads' Space is
unusable in whole or in substantial part, then:
a. If the repairs and rebuilding necessary to restore the Rad Dads' Space to
its condition prior to the occurrence or the damage can be in the reasonable
judgment of Rad Dads' be completed within ninety (90) days from the date on
which the damage occurred, Rad Dads' shall so notify the City of Muskegon in
writing and shall proceed promptly with such repairs and rebuilding, and in such
event the use of said premises shall be abated for the period from the date of the
occurrence of such damage to the date upon which such repairs and rebuilding
are completed; and
b. If such repairs and rebuilding cannot, in the reasonable judgment of Rad
Dads', be completed within ninety (90) days, the City of Muskegon and Rad
Dads' can mutually agree either to:
• Have Rad Dads' proceed promptly with said repairs and rebuilding,
in which event the said use shall be abated; or
• To terminate this Agreement.
17. RISK OF LOSS. During the term of this agreement, and any extension or
renewal thereof, the risk of loss with respect to all risks insurable under a fire and
extended coverage insurance policy meeting the requirements of the laws of the
State of Michigan, together with the risk of loss with respect to all uninsurable
losses to the premises which are subject to the control or prevention by Rad
Dads', shall rest upon Rad Dads'.
18. SUBROGATION. Rad Dads', its officers, agents or employees shall not be liable
for damage to the Rad Dads' Space or for interruption of Use Fees resulting from
any of the perils covered by fire and extended coverage insurance, or which
would be covered if such insurance were in force, and the City of Muskegon
agrees not to sue for such damage and that every applicable policy of insurance
will contain or be endorsed with the standard waiver of subrogation clause. The
City of Muskegon shall not be liable for damage to the property or business of
Rad Dads' in or on the Rad Dads' Space resulting from any of the perils covered
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if such insurance were in force) and Rad Dads agrees not to sue for such
damage and that every applicable policy of insurance will contain or be endorsed
with the standard waiver of subrogation clause.
19. INSURANCE. Rad Dads>, at its expense shall maintain general liability
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insurance insuring the City of Muskegon and Rad Dads' with minimum coverage
as follows: $1,000,000.00. Rad Dads' shall provide the City of Muskegon with a
Certificate of Insurance showing the City of Muskegon as additional insured. The
Certificate shall provide for a thirty (30) day written notice to the City of
Muskegon in the event of cancellation or material change of coverage. To the
maximum extent permitted by insurance policies, which may be owned by the
City of Muskegon or Rad Dads' Rad Dads' and the City of Muskegon for the
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benefit of each other, waive any and all rights of subrogation, which might
otherwise exist. The City of Muskegon agrees to notify Rad Dads' in writing as
soon as practicable of any claim, demand or action arising out of an occurrence
1
covered, and to cooperate with Rad Dads in the investigation and defense of
1
such claim. Rad Dads and the City of Muskegon agree that each insurance
policy shall provide for a minimum of thirty (30) days written notice of cancellation
to the City of Muskegon. Rad Dads 1 shall also be responsible for a portion of the
cost of the liquor liability insurance purchased by the City of Muskegon for the
Arena. Rad Dads' cost is estimated at $1,500 annually, and is incorporated as a
cost to overhead and maintenance in Section 8 of this agreement.
20. SIGNS. The City of Muskegon and Rad Dads' shall cooperate to secure
maximum signage area for Rad Dads' which shall be reasonable commensurate
with its exclusive space. All signage shall be in conformance with applicable
1
laws and statutes and Rad Dads shall not construct the signage without the prior
written consent of the City of Muskegon which consent shall not unreasonably be
withheld or delayed. Rad Dads' agrees that no signage will be added to the Rad
Dads' space that specifically advertises any third-party to the non-exclusive
areas of the Arena as identified in Section 2(b) of this Agreement.
21. ABANDONMENT OF RAD DADS' SPACE. If Rad Dads' shall abandon or
vacate the Rad Dads' Space, or be dispossessed by process of law, or
otherwise, the City of Muskegon shall have the right to declare this Agreement is
terminated. In such event, any personal property belonging to Rad Dads' left
within the Rad Dads' Space shall be deemed to be abandoned, and the City of
Muskegon shall be permitted to dispose of such personal property as it deems
appropriate.
22. INSOLVENCY. In the event that a receiver shall be appointed to take over the
Rad Dads' business, and such receivership is not dismissed within sixty (60)
days or in the event that the Rad Dads' shall make a general assignment for the
benefit of creditors, or Rad Dads' shall take or suffer any action under any
insolvency or bankruptcy act, the same shall constitute breach of this Agreement
by Rad Dads'.
13
23. TERMINATION OF AGREEMENT. Subject to the provisions in Paragraph 25,
The City of Muskegon, at its option, may declare this Agreement terminated in its
entirety upon the happening of any one or more of the following events:
a. If the any expenses, fees, charges, and/or other money payments for
which Rad Dads' is financially responsible, shall be unpaid thirty (30) days from
the date that they become due;
b. If Rad Dads' abandons the Rad Dads' Space for a period of thirty (30)
days at any one time, except when such abandonment and cessation is due to
fire, earthquake, governmental action, default of the City of Muskegon, or other
cause beyond it control;
c. If Rad Dads' shall use or permit the use of the Rad Dads' Space at any
time for any purpose for which the use was not authorized by this Agreement or
by a subsequent written agreement between the parties after written notice and
opportunity to cure; and
d. If Rad Dads' shall use or permit the use of the Rad Dads' Space in
violation of any law, rule or regulation to which Rad Dads' had agreed in this
Agreement to conform after written notice and opportunity to cure.
24. REMEDIES OF OWNER ON DEFAULT. In the event of any material breach of
this Agreement by Rad Dads', the City of Muskegon may, at its option, terminate
this Agreement and recover from Rad Dads': (a) the worth at the time of award of
the unpaid monthly Use Payment which would have been earned at the time of
termination; (b) the worth at the time of award of the amount by which the unpaid
monthly Use Payment which would have been earned after termination until the
time of the award exceeds the amount of such loss of use that the Rad Dads'
proves could have been reasonably avoided; (c) the worth at the time of award of
the amount by which the unpaid monthly Use Payment for the balance of the
term after the time of award exceeds the amount of such loss of use that Rad
Dads' proves could be reasonably avoided.
The City of Muskegon may, in the alternative, continue this Agreement in effect,
as long as the City of Muskegon does not terminate Rad Dads' right to use and
management, and the City of Muskegon may enforce all his rights and remedies
under this Agreement, including the right to recover the monthly Use Payment
under this Agreement, if said breach continues, the City of Muskegon may at any
time thereafter, elect to terminate this Agreement. Nothing contained herein shall
be deemed to limit any other rights or remedies which the City of Muskegon may
have.
25. RIGHT TO CURE. In addition to the rights herein before set forth, Rad Dads'
shall have the right to contest any allegation of material breach in the appropriate
court in Muskegon County, Michigan. In the event of an adjudication of a
14
material default of this agreement by such court, the relief shall provide that Rad
Dads' shall have 30 days from the date of such adjudication to cure the default.
26. RESERVATION OF RIGHTS BY THE CITY OF MUSKEGON.
a. The City of Muskegon reserves the right to further develop or improve the
Arena as it sees fits, regardless of the desires or view of Rad Dads', so long as
the improvements do not encroach into the existing footprint or operations of Rad
Dads'.
b. The City of Muskegon reserves the right to adopt, from time to time,
reasonable rules and regulations for the operation of the Arena which are not
inconsistent with the provisions of this Agreement. Rad Dads' and its agents,
employees, invitees, and licenses shall comply with all those rules and
regulations.
27. SURRENDER AND HOLDING OVER. Rad Dads' agrees that at the expiration
or termination of this Agreement, it will quit and surrender the Rad Dads' Space
in good state and condition, reasonable wear and tear excepted, and also
excepting damage arising from acts, events or conditions beyond the control of
Rad Dads', and that Rad Dads' shall forthwith remove all equipment trade
fixtures and personal property belonging to it. Rad Dads' shall give the City of
Muskegon the first right of refusal to purchase any equipment or trade fixtures
purchased by Rad Dads'. Rad Dads' further agrees that all structures and
improvements on the Rad Dads' Space and all fixtures in Exhibit B are the
property of the City of Muskegon, shall remain upon the Rad Dads' Space, and
shall be in good usable order and condition, with allowance for reasonable wear
and tear and damage by the elements, and also excepting damage arising from
acts, events and conditions beyond the control of Rad Dads'. The City of
Muskegon shall have the right upon such expiration or termination to enter upon
and take possession of such property.
28. GENERAL PROVISIONS.
a. Governing Law. This Agreement is executed in accordance with, shall
be governed by, and construed and interpreted in accordance with the laws of
the State of Michigan.
b. Entire Agreement. This Agreement shall constitute the entire agreement,
and shall supersede any other agreements, written or oral, dated prior to the
execution of this Agreement, and any contemporaneous or prior negotiations and
representations that may have been made or entered into, by and between the
parties with respect to the subject matter of this Agreement and shall not be
modified or amended except in a subsequent writing signed by the party against
whom enforcement is sought.
15
c. Binding Effect. This Agreement shall be binding upon, and inure to the
benefit of and be enforceable by, the parties and their respective legal
representatives, permitted successors and assigns.
d. Counterparts. This Agreement may be executed in counterparts, and
each set of duly delivered identical counterparts which includes all signatories
shall be deemed to be one original document.
e. Full Execution. This Agreement requires the signature of both parties.
Until fully executed, on a single copy or in counterparts, this Agreement is of no
binding force or effect and if not fully executed, this Agreement is void.
f. Non-Waiver. No waiver by any party of any provision of this Agreement
shall constitute a waiver by such party of such provision on any other occasion or
a waiver by such party of any other provision of this Agreement.
g. Severability. Should any one or more of the provisions of this Agreement
be determined to be invalid, unlawful, or unenforceable in any respect, the
validity, legality, and enforceability of the remaining provisions of this Agreement
shall not in any way be impaired or affected.
h. Assignment or Delegation. Except as otherwise specifically set forth in
this Agreement, neither party shall assign all or any portion of its rights and
obligations contained in this Agreement without the express prior written approval
of the other party, which approval may not be unreasonably withheld.
i. Venue. The parties agree that for purposes of any dispute in connection
with this agreement, the Muskegon County Circuit Court shall have exclusive
personal and subject matter jurisdiction and venue.
j. Terms. Nouns and pronouns will be deemed to refer to the masculine,
feminine, neuter, singular and plural, as the identity of the person or persons, firm
or corporation may in the context require.
k. Fax Signatures. The parties have agreed that fax copies of the signed
Agreement shall constitute a valid, enforceable agreement. Each party will mail
originals to the respective party upon their execution of this Agreement.
I. Notices. Any notice which either party may or is required to give, shall be
given by mailing the same, postage prepaid, to Rad Dads' at the address shown
above, or the City of Muskegon at the address shown above, or at other such
places as may be designated by the parties from time to time. Notice shall be
sent by regular first-class mail or by registered or certified mail, return receipt
requested.
16
THE CITY OF ~
By:
Name:
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Title: C.l1 7 Mc-v-c..~
Date: Mw r \A J , 2022
'
RAD DADS' TACOS AND TEQUILA, LLC
By: ~~ '---= ~
Name: Matt Gongalski
-
Title: Managing Member
Date: ,-,,,,t~ :314' , 2022
17
Exhibit A
Rad Dads' Space
'1'\ BLACK ANODIZEDAUJMINUM AND GLASS
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Agreement for Management of a Portion of a Licensed Premises
Pursuant to Participating Agreement
THIS AGREEMENT is made and executed as of
between the
_Jl/\,::,,_y
__)
_6 \ ~ 2022
City of Muskegon
a Michigan municipal corporation
933 Terrace St.
Muskegon, Ml49440
(hereinafter "City of Muskegon"), and
Carlisle's Goods & Leisure, LLC
a Michigan limited liability company
14716 Leonard Rd.
Spring Lake, Ml 49456
(hereinafter "Carlisle")
RECITALS
A. The City of Muskegon owns the Mercy Health Arena located at 470 W. Western
Avenue, Muskegon, Michigan 49440 ("Arena"). The City of Muskegon is
responsible for operation, maintenance and improvements for the Arena.
B. The City of Muskegon has the authority to authorize use of portions of the Arena
on an exclusive and non-exclusive basis.
C. The City of Muskegon has applied for a Class C liquor license and related
permits issued by the Michigan Liquor Control Commission ("MLCC") for
providing a restaurant, concessions, bar and bar service throughout the Arena
(collectively the "License").
D. The City of Muskegon proposes entering into a Participating Agreement with
Carlisle pursuant to Rule 436.1401 to permit the limited use of the license,
subject to and only upon the approval of the MLCC, upon the terms and
conditions of this Agreement.
E. In connection with this Agreement, the City of Muskegon is willing to grant to
Carlisle, and Carlisle desires to receive from the City of Muskegon, the exclusive
right to use and manage that portion of the Arena to be known as the Carlisle
Area (See attached Exhibit A) for the operation of a certain restaurant and bar
business commonly known as the "Carlisle's Goods & Leisure", subject to and in
accordance with the terms and conditions of this Agreement.
In consideration of the premises and the mutual promises set forth herein, the
parties agree as follows:
1. CARLISLE PARTICIPATING AGREEMENT. Upon execution of this Agreement,
the parties agree to act in good faith and to utilize their best efforts to make
application to the MLCC for a Participating Agreement/Participation Permit
Application pursuant to Rule 436.1041. Carlisle will operate a full-service
restaurant, bar and bar service within the Carlisle Space as hereinafter defined.
The parties acknowledge that this Agreement is contingent upon and shall only
become effective upon approval of the MLCC of the Participating
Agreement/Participation Permit Application.
2. DESCRIPTION OF CARLISLE SPACE. Carlisle will have the right to use and
manage the Carlisle Space and fixtures as follows:
a. The exclusive right to use and manage the Carlisle Space (depicted on the
attached Exhibit A) and the Outdoor Sidewalk Patio, and a non-exclusive right of
access for Carlisle's employees, patrons and suppliers to and from the
Restaurant Space across other portions of the Arena.
b. The limited nonexclusive right to use other areas in the Arena that would not
interfere with the management and operation of the Arena by the City of
Muskegon, excluding only the area identified as the "Rad Dad's Space" in the
Agreement for Management of a Portion of a Licensed Premises Pursuant to
Participating Agreement between the City of Muskegon and Rad Dad's, LLC
(depicted on Exhibit B).
c. Notwithstanding the foregoing, during events held at the Arena when it is
open to the public, the term exclusive use shall be construed to allow patrons to
enter and leave the Carlisle Space and all areas of the Arena licensed by the
MLCC.
3. TERM. This Agreement shall become effective upon execution with the
contingencies provided for herein. The initial term of this Agreement shall be for
a period of five (5) years commencing with the approval of the MLCC of the
Participating Agreement/Participation Permit Application with a term extension
equal to the time from such approval to the date a certificate of occupancy is
issued by the City of Muskegon, a license is issued by the Muskegon County
Department of Health or the MLCC has approved the licensed space identified
on Exhibit A, whichever date is latest. The monthly Use Payment shall
commence on the first day of the month following such approval. In addition,
Carlisle shall have six additional five (5) year options. In the absence of any
other provision herein, Carlisle shall be provided written notice of any default and
afforded not less than sixty (60) days to cure the default. Provided that Carlisle is
not in material default of this Agreement at the time of expiration of the initial term
or any option term, Carlisle shall provide the City of Muskegon with written notice
2
of its intent to renew this Agreement in writing no later than sixty (60) days prior
to the expiration of the initial term and any renewal term provided, however, that
said sixty (60) days shall not begin to toll until sixty (60) days after the City of
Muskegon has provided Carlisle with written notice of the expiration of the initial
term or any renewal term.
4. CONSTRUCTION AND IMPROVEMENTS: USAGE. Upon approval by the
MLCC of the Participating Agreement, the City of Muskegon, at its sole cost and
expense, will undertake construction of Carlisle Space improvements
substantially in accordance with the plans, specifications and costs identified and
attached hereto as Exhibit B. The City of Muskegon agrees to proceed in good
faith and in a reasonable manner in order to complete the work and obtain all
regulatory approvals and signoffs within 60 days of this agreement provided that
an additional term of 120 days will be allowed for completion. Carlisle will repay
the City of Muskegon the actual costs of the improvements within 90 days
following the completion of the construction and issuance approval of the
License, whichever occurs later. Upon completion of the construction, the City of
Muskegon shall provide Carlisle with written confirmation of the amounts
expended by the City of Muskegon under this Section 4. The total Cost of
Improvements shall not exceed $650,000 unless mutually agreed to between the
parties and, once repayment is made by Carlisle as set forth above, shall be
credited against the Use Payments provided for in Paragraph 6.
Carlisle shall use and manage the Carlisle Space for purposes of operating a
sports bar and restaurant operation, including food and beverage service
preparation ("Restaurant").
5. CARLISLE'S COMPENSATION. In consideration for the management and
operation of the Restaurant and the Carlisle Space, Carlisle shall retain 100% of
the net profits generated from the operation of the Restaurant, including the sale
of alcoholic beverages under the License, non-alcoholic beverages, food,
merchandise and cover charges and other goods and services which would not
constitute a violation of MLCC rules. The term "net profits" as used in this
Agreement shall mean all revenue derived from the operation of the Restaurant
less all expenses related to the operation of the Restaurant. During the term of
this Agreement, Carlisle will deliver to the City of Muskegon by the 15th day of the
end of each month an income statement certified by an officer or manager of
Carlisle setting forth its net profits. Carlisle grants to the City of Muskegon the
right at all reasonable times to have access to all books, accounts, records and
reports, that may be kept by Carlisle showing all financial information related to
the operation of the Restaurant. If a review discloses any discrepancy in the net
profits, the parties shall mutually agree on a Certified Public Accountant to review
the financial statements and records of Carlisle and determine the net profits.
Such determination shall be binding on the parties.
3
6. MONTHLY USE PAYMENT. In consideration of this Agreement, Carlisle shall
pay monthly Use Payment to the City of Muskegon in an amount equal to
$3,645.83 during the initial Term. Provided, each subsequent five-year renewal
option thereafter, the applicable monthly Use Payment will be adjusted as
follows:
a. Option #1 $4,229.17
b. Option #2 $4,666.67
C. Option #3 $4,958.33
d. Option #4 $5,250.00
e. Option #5 $5,541.67
f. Option #6 $5,833.33
Construction costs paid by Carlisle and/or reimbursed to the City of Muskegon,
up to $650,000 as set forth in paragraph 4, will result in a use credit to Carlisle at
the rate of $7.00 per month for each $1,000 of construction costs incurred
together with interest on the unreimbursed construction costs calculated at the
rate of 5% per annum. Any unused credit for the month shall roll over and be
added to the total available use credit in subsequent months. These credits shall
continue monthly for the term of this Agreement and any extensions thereof to
and until such time as the use credit is fully utilized and amortized.
7. ADJUSTMENT OF MONTHLY USE PAYMENT. The monthly Use Payment
shall be adjusted upon the following events and upon the following terms:
i. Professional Hockey, Football 1 and Soccer Games. The amount of monthly
use fee shall periodically increase during months when there occur in the Arena
USHL hockey, professional football, and/or professional soccer games. The
amount of such increase shall be the sum of $500 per USHL hockey event day,
$400 per professional football event day and $400 per professional soccer event
day that takes place at the Arena during a given month, and shall be paid with
the payment of the following month's use payment. For example, if during the
term of this Agreement there are five hockey events and two football events at
the Arena during the month of January, Carlisle's use fee for the month of
February would be increased by $3,300 ($500 x five hockey events ($2,500) +
$400 x two football events ($800) = $3,300). Carlisle shall have no further
obligation to provide financial support or sponsorship to any event using the
Mercy Health Arena. If Carlisle can reasonably demonstrate that events held in
the Arena other than USHL hockey, professional football, and professional
soccer, negatively impact the gross sale of Carlisle, Carlisle shall not be
obligated to pay a temporary rent increase for any such other events.
ii. Suspension of Liquor License. In the event that the License issued by the
MLCC shall be suspended, Use Payments shall be suspended pro rata during
such suspension term.
4
8. CONTRIBUTION TO OVERHEAD AND MAINTENANCE. Carlisle shall also pay
to the City of Muskegon a contribution for overhead utilities not separately
metered and maintenance an amount equal to $1,750 per month during the initial
Term.
9. UTILITY COSTS. City shall pay all charges for gas, electricity, water, power,
telephone, cable television and internet service used, rendered or supplied upon
or in connection with the Carlisle Space. City shall have the discretion to set the
level of cable service provided within the Carlisle Space. Carlisle may request
that the City upgrade such services, with the additional associated costs added
to Carlisle's contribution to overhead and maintenance as outlined in Section 8 of
this Agreement.
10. ASSIGNMENT. Carlisle shall not assign this Agreement without prior written
consent of the City of Muskegon and the MLCC. Such approval and consent
shall not unreasonably be withheld by the City of Muskegon and shall be subject
to the rules and regulations of the MLCC.
11. OBLIGATIONS OF THE CITY OF MUSKEGON. The City of Muskegon shall
purchase all alcoholic and food inventory to be used by the Restaurant. The City
of Muskegon shall furnish "janitorial services" for the exterior of the building and
in lobby areas and restrooms used by the public, exclusive of those areas used
and managed by Carlisle. The City of Muskegon agrees to maintain in
satisfactory working order, all public ways and structures of the Arena, including
plate glass, roof, and outer walls and heating, electrical and plumbing supply
sites, air conditioning and hot water supply units. The City of Muskegon agrees to
allow use of its dumpsters by Carlisle, and the cost of such service shall be
shared between The City of Muskegon and Carlisle. The City of Muskegon
agrees to be responsible for any structural repairs, replacements or changes in
the Arena which affect the Carlisle Space for its intended purpose.
12. OBLIGATIONS OF CARLISLE. Carlisle shall reimburse the City of Muskegon
for all alcoholic and food inventory purchased by the City of Muskegon for the
Restaurant within 15 days of receipt of an invoice from the City of Muskegon.
Carlisle agrees that it will pay all expenses in connection with the use and
management of the Carlisle Space and fixtures, including, but not limited to, all
rights and privileges granted, including all taxes, permits, fees, license fees and
assessments lawfully levied or assessed upon Carlisle's personal property or
upon its use of possession of the Carlisle Space and fixtures. Except for the
License, Carlisle agrees to secure all permits and licenses required related to its
use of the Carlisle Space, including any other metered utility services provided to
the Carlisle Space.
Carlisle agrees that it will at all times maintain the Carlisle Space and fixtures in a
neat, clean, safe, sanitary and orderly condition, and shall provide janitorial
services with respect thereto. Carlisle shall provide for the sanitary handling and
5
disposal of trash and other refuse from its operation in a manner satisfactory to
the City of Muskegon.
Carlisle will make no structural changes or additions to the Carlisle Space without
first obtaining written approval from the City of Muskegon.
Carlisle agrees to provide and pay for any and all decorations to the Carlisle
Space. Carlisle shall provide the following services from the Carlisle Space at all
times during the term of this Agreement at its sole cost and expense:
a. Carlisle shall furnish, at its expense, all service equipment of every sort
(such as silverware, linen, glassware, crockery, utensils, pots and pans, and
additional equipment), which may be required for use in Carlisle's operation and
which is not already presently located in the Carlisle Space.
b. Carlisle shall undertake to comply with all MLCC rules and shall not allow
entertainment.
c. Carlisle shall cooperate with the City of Muskegon in securing all permits
and licenses required by any public agency, including the License issued by the
MLCC in connection with the operation of the Arena as a sports and
entertainment venue.
d. Carlisle shall carry workers compensation insurance in the amounts
required by state law for all employees hired by Carlisle to work in the Carlisle
Space.
13. ORDINANCES AND STATUTES. Carlisle shall comply with all statutes,
ordinances and requirements of all municipal, state and federal authorities now in
force or which may be in force, pertaining to the premises, occasioned by or
affecting the use there of by Carlisle. The commencement or pendency of any
state or federal court abatement proceeding affecting the use of the Carlisle
Space shall, at the option of the City of Muskegon, be deemed a breach hereof.
The City of Muskegon represents and warrants that the Arena shall be in
compliance with the Americans with Disabilities Act, and its regulation, as of the
commencement of this Agreement.
14. MAINTENANCE, REPAIRS, ALTERATIONS. Carlisle shall, at its expense and
at all times, maintain the Carlisle Space in good and safe condition, including
plate glass, electrical wiring, plumbing and heating installations. Carlisle shall
also maintain in good condition such portions adjacent to the Arena within the
Carlisle Space, such as sidewalks, driveways, lawns and shrubbery.
15. ENTRY AND INSPECTION. Carlisle shall permit the City of Muskegon or the
City of Muskegon's agents to enter upon the Carlisle Space at reasonable times
for the purpose of performing maintenance and making repairs and replacement
in any case where the City of Muskegon is obligated, and in any other case
6
where the City of Muskegon determined that it was necessary to do so in order to
preserve the structural safety of the Carlisle Space to correct any condition likely
to cause injuries or damages to persons or property.
16. DAMAGE OR DESTRUCTION OF PREMISES. If by reason of any cause the
Carlisle Space is damaged to such an extent that the Carlisle Space is unusable
in whole or in substantial part, then:
a. If the repairs and rebuilding necessary to restore the Carlisle Space to its
condition prior to the occurrence or the damage can be in the reasonable
judgment of Carlisle be completed within ninety (90) days from the date on which
the damage occurred, Carlisle shall so notify the City of Muskegon in writing and
shall proceed promptly with such repairs and rebuilding, and in such event the
use of said premises shall be abated for the period from the date of the
occurrence of such damage to the date upon which such repairs and rebuilding
are completed; and
b. If such repairs and rebuilding cannot, in the reasonable judgment of
Carlisle, be completed within ninety (90) days, the City of Muskegon and Carlisle
can mutually agree either to:
• Have Carlisle proceed promptly with said repairs and rebuilding, in
which event the said use shall be abated; or
• To terminate this Agreement.
17. RISK OF LOSS. During the term of this lease, and any extension or renewal
thereof, the risk of loss with respect to all risks insurable under a fire and
extended coverage insurance policy meeting the requirements of the laws of the
State of Michigan, together with the risk of loss with respect to all uninsurable
losses to the premises which are subject to the control or prevention by Carlisle,
shall rest upon Carlisle.
18. SUBROGATION. Carisle, its officers, agents or employees shall not be liable for
damage to the Leased Premises or for interruption of rent resulting from any of
the perils covered by fire and extended coverage insurance, or which would be
covered if such insurance were in force, and the City of Muskegon agrees not to
sue for such damage and that every applicable policy of insurance will contain or
be endorsed with the standard waiver of subrogation clause. The City of
Muskegon shall not be liable for damage to the property or business of Carlisle in
or on the Carlisle Space resulting from any of the perils covered if such insurance
were in force, and Carlisle agrees not to sue for such damage and that every
applicable policy of insurance will contain or be endorsed with the standard
waiver of subrogation clause.
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19. INSURANCE. Carlisle, at its expense, shall maintain general liability insurance
insuring the City of Muskegon and Carlisle with minimum coverage as follows:
$1,000,000.00. Carlisle shall provide the City of Muskegon with a Certificate of
Insurance showing the City of Muskegon and CFMC as additional insureds. The
Certificate shall provide for a thirty (30) day written notice to the City of
Muskegon and CFMC in the event of cancellation or material change of
coverage. To the maximum extent permitted by insurance policies, which may
be owned by the City of Muskegon or Carlisle, Carlisle and the City of Muskegon,
for the benefit of each other, waive any and all rights of subrogation, which might
otherwise exist. The City of Muskegon agrees to notify Carlisle in writing as soon
as practicable of any claim, demand or action arising out of an occurrence
covered, and to cooperate with Carlisle in the investigation and defense of such
claim. Carlisle and the City of Muskegon agree that each insurance policy shall
provide for a minimum of thirty (30) days written notice of cancellation to the City
of Muskegon. Carlisle shall also be responsible for a portion of the cost of the
liquor liability insurance purchased by the City of Muskegon for the Arena.
Carlisle agrees that the amount of the liquor liability premium equal to the percent
that Carlisle's alcohol sales bear to total sales under the License during the
measured period of time shall be added to the monthly Use Payment on an
estimated prorated basis, with any necessary adjustments being made within 30
days after the end of a calendar quarter.
20. SIGNS. The City of Muskegon and Carlisle shall cooperate to secure maximum
signage area for Carlisle which shall be reasonable commensurate with its
exclusive space. All signage shall be in conformance with applicable laws and
statutes and Carlisle shall not construct the signage without the prior written
consent of the City of Muskegon which consent shall not unreasonably be
withheld or delayed.
21. ABANDONMENT OF CARLISLE SPACE. If Carlisle shall abandon or vacate
the Carlisle Space, or be dispossessed by process of law, or otherwise, the City
of Muskegon shall have the right to declare this Agreement is terminated. In
such event, any personal property belonging to Carlisle left within the Carlisle
Space shall be deemed to be abandoned, and the City of Muskegon shall be
permitted to dispose of such personal property as it deems appropriate.
22. INSOLVENCY. In the event that a receiver shall be appointed to take over the
Carlisle's business, and such receivership is not dismissed within sixty (60) days
or in the event that the Carlisle shall make a general assignment for the benefit of
creditors, or Carlisle shall take or suffer any action under any insolvency or
bankruptcy act, the same shall constitute breach of this Agreement by Carlisle.
23. TERMINATION OF AGREEMENT. Subject to the provisions in Paragraph 25,
The City of Muskegon, at its option, may declare this Agreement terminated in its
entirety upon the happening of any one or more of the following events:
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a. If the any expenses, fees, charges, and/or other money payments for
which Carlisle is financially responsible, shall be unpaid thirty (30) days from the
date that they become due;
b. If Carlisle abandons the Carlisle Space for a period of thirty (30) days at
any one time, except when such abandonment and cessation is due to fire,
earthquake, governmental action, default of the City of Muskegon, or other cause
beyond it control;
c. If Carlisle shall use or permit the use of the Carlisle Space at any time for
any purpose for which the use was not authorized by this Agreement or by a
subsequent written agreement between the parties after written notice and
opportunity to cure; and
d. If Carlisle shall use or permit the use of the Carlisle Space in violation of
any law, rule or regulation to which Carlisle had agreed in this Agreement to
conform after written notice and opportunity to cure.
24. REMEDIES OF OWNER ON DEFAULT. In the event of any material breach of
this Agreement by Carlisle, the City of Muskegon may, at its option, terminate
this Agreement and recover from Carlisle: (a) the worth at the time of award of
the unpaid monthly Use Payment which would have been earned at the time of
termination; (b) the worth at the time of award of the amount by which the unpaid
monthly Use Payment which would have been earned after termination until the
time of the award exceeds the amount of such loss of use that the Carlisle
proves could have been reasonably avoided; (c) the worth at the time of award of
the amount by which the unpaid monthly Use Payment for the balance of the
term after the time of award exceeds the amount of such loss of use that Carlisle
proves could be reasonably avoided.
The City of Muskegon may, in the alternative, continue this Agreement in effect,
as long as the City of Muskegon does not terminate Carlisle's right to use and
management, and the City of Muskegon may enforce all his rights and remedies
under this Agreement, including the right to recover the monthly Use Payment
under this Agreement, if said breach continues, the City of Muskegon may at any
time thereafter, elect to terminate this Agreement. Nothing contained herein shall
be deemed to limit any other rights or remedies which the City of Muskegon may
have.
25. RIGHT TO CURE. In addition to the rights herein before set forth, Carlisle shall
have the right to contest any allegation of material breach in the appropriate court
in Muskegon County, Michigan. In the event of an adjudication of a material
default of this agreement by such court, the relief shall provide that Carlisle shall
have 30 days from the date of such adjudication to cure the default.
26. RESERVATION OF RIGHTS BY THE CITY OF MUSKEGON,
9
a. The City of Muskegon reserves the right to further develop or improve the
Arena as it sees fits, regardless of the desires or view of Carlisle.
b. The City of Muskegon reserves the right to adopt, from time to time,
reasonable rules and regulations for the operation of the Arena which are not
inconsistent with the provisions of this Agreement. Carlisle and its agents,
employees, invitees, and licenses shall comply with all those rules and
regulations.
27. SURRENDER AND HOLDING OVER. Carlisle agrees that at the expiration or
termination of this Agreement, it will quit and surrender the Carlisle Space in
good state and condition, reasonable wear and tear excepted, and also
excepting damage arising from acts, events or conditions beyond the control of
Carlisle, and that Carlisle shall forthwith remove all equipment trade fixtures and
personal property belonging to it. Carlisle shall give the City of Muskegon the
first right of refusal to purchase any equipment or trade fixtures purchased by
Carlisle. Carlisle further agrees that all structures and improvements on the
Carlisle Space and all fixtures in Exhibit B are the property of the City of
Muskegon, shall remain upon the Carlisle Space, and shall be in good usable
order and condition, with allowance for reasonable wear and tear and damage by
the elements, and also excepting damage arising from acts, events and
conditions beyond the control of Carlisle. The City of Muskegon shall have the
right upon such expiration or termination to enter upon and take possession of
such property.
28. GENERAL PROVISIONS.
a. Governing Law. This Agreement is executed in accordance with, shall
be governed by, and construed and interpreted in accordance with the laws of
the State of Michigan.
b. Entire Agreement. This Agreement shall constitute the entire agreement,
and shall supersede any other agreements, written or oral, and any
contemporaneous or prior negotiations and representations that may have been
made or entered into, by and between the parties with respect to the subject
matter of this Agreement and shall not be modified or amended except in a
subsequent writing signed by the party against whom enforcement is sought.
c. Binding Effect. This Agreement shall be binding upon, and inure to the
benefit of and be enforceable by, the parties and their respective legal
representatives, permitted successors and assigns.
d. Counterparts. This Agreement may be executed in counterparts, and
each set of duly delivered identical counterparts which includes all signatories
shall be deemed to be one original document.
10
e. Full Execution. This Agreement requires the signature of both parties.
Until fully executed, on a single copy or in counterparts, this Agreement is of no
binding force or effect and if not fully executed, this Agreement is void.
f. Non-Waiver. No waiver by any party of any provision of this Agreement
shall constitute a waiver by such party of such provision on any other occasion or
a waiver by such party of any other provision of this Agreement.
g. Severability. Should any one or more of the provisions of this Agreement
be determined to be invalid, unlawful, or unenforceable in any respect, the
validity, legality, and enforceability of the remaining provisions of this Agreement
shall not in any way be impaired or affected.
h. Assignment or Delegation. Except as otherwise specifically set forth in
this Agreement, neither party shall assign all or any portion of its rights and
obligations contained in this Agreement without the express prior written approval
of the other party, which approval may not be unreasonably withheld.
i. Venue. The parties agree that for purposes of any dispute in connection
with this agreement, the Muskegon County Circuit Court shall have exclusive
personal and subject matter jurisdiction and venue.
j. Terms. Nouns and pronouns will be deemed to refer to the masculine,
feminine, neuter, singular and plural, as the identity of the person or persons, firm
or corporation may in the context require.
k. Fax Signatures. The parties have agreed that fax copies of the signed
Agreement shall constitute a valid, enforceable agreement. Each party will mail
originals to the respective party upon their execution of this Agreement.
I. Notices. Any notice which either party may or is required to give, shall be
given by mailing the same, postage prepaid, to Carlisle at the address shown
above, or the City of Muskegon at the address shown above, or at other such
places as may be designated by the parties from time to time. Notice shall be
sent by regular first-class mail or by registered or certified mail, return receipt
requested.
II
THE CITY OF MUSKEGON
By~
~-ttUStr-."\
Name:
Title: Pre~,
Date: 3
4'
l ,f, /11"""0-"
Z-ol.... t , 2022
CARLISLE'S GOODS & LEISURE, LLC
By:
Name:
6£.._~
Title: Member
Date: .S/6/'l.,d-..
I
, 2022
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Exhibit A
Carlisle Space
13
Exhibit B
Carlisle Plans, Specifications and Fixtures
(attached)
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