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HomeMy WebLinkAboutResolutions - 2008.05.22 - 9545REPORT (MISC. #08078) May 22, 2008 BY: Planning and Building Committee, Sue Ann Douglas, Chairperson IN RE: MR #08078 - PARKS AND RECREATION COMMISSION — E.A. FULLER OAK MANAGEMENT CORPORATION LEASE AMENDMENT To the Oakland County Board of Commissioners Chairperson, Ladies and Gentlemen: The Planning and Building Committee, having reviewed the above-titled resolution on May 12, 2008, reports with a recommendation that the resolution be adopted. Chairperson, on behalf of the Planning and Building Committee, I move acceptance of the foregoing report. PLANNING AND BUILDING COMMITTEE PLANNING & BUILDING COMMITTEE VOTE: Motion carried unanimously on a roll call vote. MISCELLANEOUS RESOLUTION # 08078 April 24, 2008 BY: General Government Committee Christine Long, Chairperson IN RE: PARKS AND RECREATION COMMISSION — E. A. FULLER OAK MANAGEMENT CORPORATION LEASE AMENDMENT To the Oakland County Board of Commissioners Chairperson, Ladies and Gentlemen: WHEREAS, this first Amendment (Amendment) .;s attached and made a part of a certain Lease Agreement (Agreement) dated December 14. 2006, by and between tie COUNTY OF OAKLAND, (Lessor) a Michigan Municipal and Constitutional Corporation, whose address is 1200 N. Telegraph Rd., Pontiac, Michigan, 48341, on behalf of the OAKLAND COUNTY PARKS AND RECREATION COMMISSION (Parks), and E. A. FULLER OAK MANAGEMENT CORPORATION (Lessee), a Michigan Corporation: and WHEREAS, the Lessor and the Lessee agree to revise the rental payments for the Premises for the year 2008; and WHEREAS, the Agreement provides that the Lessee may extend the Lease through 2015 if it meets the conditions stated in the Agreement; and WHEREAS, the Lessor and Lessee are desirous of establishing the rental payments for the years 2009 through 2015 (which will be the same for tie year 2008) at tnis time: and WHEREAS the Oakland County Parks and Recreation Commission approved these revisions at their regular meeting on March 12, 2008. for forwarding and approval by the Oakland County Board of Commissioners. NOW THEREFORE BE IT RESOLVED, in consideration of the mutual promises and covenants set forth below, the Lessor and Lessee agree as follows: 1. Section 4 TERM of LEASE of the Agreement is revised to read as follows: Tenth Amendment: A. Section 1.3 of the Concession Agreement is amended to include the following paragraph: "Providing Lessee shall not be in default under the terms and conditions of this Agreement, it shall have the right at its option to extend the term of this Agreement for an additional seven (7) year period to commence on January 1, 2009 and end on December 31, 2015 at the rental payments for the premises as set forth in Section 5 of this Agreement. 2. Section 5 LEASED PREMISES and RENT of the Agreement is revised to read as follows: B. Paragraph 4.2 of tie Concession Agreement is modified to substitute the following in its entirety: 4,2 Payments by Lessee. Lessee, in consideration of this Agreement, hereby covenants and agrees to pay the Lessor the following sums (which include cnarges for heat. electricity and water service) as rent for the Premises for the year 2008, and, if the Agreement is extended. for the years 2009 through 2015, to wit: White Lake Oaks Lessee shall pay as rental eleven and one-half percent (11.5°/0) of total annual gross sales. Addison Oaks Conference Center Lessee shall pay as rental nine and one-half percent (9.5%) of total annual gross sales. Addison Oaks Concession Stand Lessee shall pay as rental one nundred percent (100%) of the annual gross sales up to $1,600 arid twelve percent (12%) of the total annual gross sales over 51.600. Springfield Oaks Golf Clubhouse Lessee shall pay as rental ten percent (10%) of the total annual gross. Springfield Oaks Activity Center Lessee shall pay as rental ten percent (10%) of the total annual gross sales. Waterford Oaks Activity Center Lessee shall pay as rental ten percent (10%) of the total annual gross sales. Red Oaks Golf Course Lessee shall provide vending machines for the golf course pro shop and concession services for the golf course and shall pay as rental ninety percent (90%) of the total annual gross sales. Red Oaks Wave Pool Concession Stand Lessee shall pay as rental twelve percent (12%) of the totai annual gross sales. Waterford Oaks Wave Pool Concession Stand GENERAL GOVERNMENT COMMITTEE VOTE: Motion carried unanimously on a roll cali vote with Kowall and Suarez absent. Resolution 1108078 April 24, 2008 Lessee shall pay as rental twelve percent (12%) of the tota; annual gross sales. Waterford Oaks Refrigerated Toboggan Run Lessee shall pay as rental ten percent (10%) of the total annual gross sales. Groveland Oaks Concession Stand Lessee shall pay as rental twelve percent (12%) of the total annual gross sales. Independence Oaks Concession Staho Lessee shall pay as rental one hundred percent (100%) of the annual gross sales. Glen Oaks Golf Clubhouse Lessee shall pay as rental sixteen percent (16%) of the total annual gross sales on the banquet facility and grill room facility. Lyon Oaks Golf Clubhouse Lessee shall pay as rental fifteen and one-half percent (15.5%) of the total annual gross sales on the banquet facility and grill room. The term gross sales shall include the gross amount of all sales of every kind and description made in, upon, or resulting from the conduct of the business of Lessee upon the various recreational facilities covered by this Agreement, but after deduction therefrom refunds made in the normal course of business, service charges and amounts paid for sales tax. Net proceeds from vending machines shall be included in gross sales. All percentage payments provided hereunder shall be payable quarterly, not later than the thirtieth (30th) day following the end of the first three (3) months of operation and the end of each three (3) month period thereafter, and shall be based uoon reports furnished by Lessee to the Lessor with such payments. Lessee shall furnish to the Lessor within sixty (60) days after the closing of each calendar year a report certified to by an officer of Lessee, snowing Lessee's gross receipts during the preceding calendar year, the amount of any accumulated prior deficiency in percentage payments, and the net percentage payment if any, owing hereunder for such period, provided that. if at the end of any quarter it is determined that Lessee has paid for said year to date a greater sum than would have been payable under the provisions hereof, an adjustment shall be made for such excess payment. If payments from the Lessee are not made within the specified sixty (60) days after the closing of each calendar year. simple interest shall accrue, but will not result in a violation of the Concession Agreement. BE IT FURTHER RESOLVED that the Oakland County Board of Commissioners approves the First Amendment to the Lease Agreement between the County of Oakland and the E. A. Fuller Oak Management Corporation. Chairperson, on behalf of the General Government Committee, I move the adoption of the foregoing resolution. GENERAL GOVERNMENT COMMITTEE ct The Chairperson referred the resolution to the Planning and Building Committee and the Finance Committee. There were no objections. LEASE AGREEMENT BETWEEN OAKLAND COUNTY, MICHIGAN AND E. A. FULLER OAK MANAGEMENT CORPORATION This Lease Agreement entered into between the COUNTY OF OAKLAND (hereinafter LESSOR), a Michigan Municipal and Constitutional Corporation, whose address is 1200 N. Telegraph Rd, Pontiac, Michigan, 48341,on behalf of the OAKLAND COUNTY PARKS & RECREATION COMMISSION (hereinafter PARKS), a statutory agency of the County of Oakland, and E.A. Fuller Oak Management Corporation (hereinafter LESSEE) as successor in interest to THE OAKS CORPORATION formerly known as LAFFREY, WERTHMANN, FULLER RESTAURANTS, INC., whose address is 1480 W. Romeo Road, Leonard, Michigan, 48367, is made in order to ratify a certain lease agreement (originally entitled Concession Agreement) entered into between LAFFREY, WERTHMANN, FULLER RESTAURANTS, INC. and PARKS on April 25, 1974 (as revised on June 20, 1979 and amended 10 times, the last amendment being dated April 4, 1999). Now therefore, in consideration of the percentages of gross profits to be paid to PARKS by LESSEE, and the covenants to be performed by the LESSEE and PARKS, the LESSOR leases to LESSEE and the LESSEE rents from the LESSOR the premises as enumerated in the April 25, 1974 Agreement (as amended) upon the following terms and conditions: 1. PREVIOUS AGREEMENTS. The terms and conditions of the original Agreement dated April 25, 1974 as revised on June 20, 1979, and the subsequent ten amendments are incorporated herein by reference and adopted as part of this Agreement (See Attachment 1). 2. INSURANCE. The Insurance provisions of the original Agreement dated April 25, 1974, as revised on June 20, 1979, (Section 3.7 as amended) will be superseded by this paragraph and the following insurance requirements shall be met by LESSEE: Indemnification 1. The Operator does hereby covenant and agree to indemnify, defend and save harmless the County from all fines, suits, claims, demands and actions of any kind and nature by reason of any and all of its negligence in conducting operations and does hereby agree to assume all risks in the operation of its business hereunder and shall be solely responsible and answerable la damages for any and all accidents or injuries to persons or property caused by the negligence of Operator, its employees and agents. The indemnification rights contained in this Contract are in excess and over and above any valid and collectible insurance rights/policies carded by the Operator. 2. Operator shall have no rights against the County for any indemnification (e.g., contractual, equitable, or by implication), contribution, subrogation, and/or any other right to be reimbursed by the County except as expressly provided herein. 3. Operator waives and releases all actions, liabilities, loss and damage including any subrogated rights it may have against the County based upon any Claim brought against the County including any Claim brought against the County by an Employee of the Operator. Operator Provided Casualty Insurance: Operator shall, at its own expense, procure and maintain insurance coverage in the minimum amounts and specifications indicated through the term of this agreement. a. Commercial General Liability — Occurrence Form Basis: $3,000,000 - General Aggregate Limit other than Products/Completed Operations $3,000,000 — Products/Completed Operations Aggregate Limit $3,000,000 — Personal & Advertising Injury Limit $3,000,000 — Each Occurrence Limit $1,000,000 - Fire Damage Limit (Any One Fire) The insurance policy shall contain the following coverage: Products/Completed Operations Coverage — On and Off Premises Coverage Broad Form Property Damage Premises/Operations Libel and Slander Independent Contractors (Blanket) Broad form Contractual Personal Injury - delete contractual exclusion "A" b. Workers' Compensation: Coverage A, with limits statutorily required by any applicable Federal or State law and Employers Liability Insurance, and Coverage B, with minimum limit of $1,000,000 each accident, disease each employee, and disease policy limit. c. Automobile Liability: Insurance (including Michigan No-Fault) with minimum limits of $1,000,000.00 Combined Single Limit Automobile Liability per occurrence including hired and leased vehicles, and owned and non-owned vehicles. d, Liouor Liability (On and Off Premises): $1,000,000 per occurrence and $2,000,000 aggregate. General Provisions: All Certificates of Insurance and policies of the Operator, any outside vendor, or contractor shall be endorsed to provide the following clauses and/or endorsements: 1. "The insurance company(s) issuing the policy or policies shall have no recourse against the County of Oakland for payment of any premiums or for assessments under any form of policy". 2. Any and all deductibles in the above-described insurance policies shall be assumed by and be or the amount of, and at sole risk of, the Operator. 3. All Certificates are to provide sixty (60) day written notice of material change, cancellation, or non-renewal. Certificates of Insurance and insurance binders 3 must be provided no less than ten (10) working days before commencement of work to the Oakland County Purchasing Division. 4, All insurance policies shall be endorsed to name "The County of Oakland, County Agents (as defined in this Contract), employees, volunteers and elected and appointed officials of Oakland County as Additional Insured. 5. All insurance policies shall be issued by companies licensed or approved to do business within the State of Michigan and carry a minimum A.M. Best rating of AS. 6. All policies of insurance shall be on a primary, non-contributory basis with any other insurance andior self-insurance carried by the County. 3. • PROPERTY DAMAGE. The following language will be deleted from the original Agreement dated April 25, 1974, as revised on June 20, 1979, (Section 3.5 as amended): The County and Operator agree that each forfeits any right of action that it may later acquire against the other of the parties to the Agreement for loss or damage to its property or to property in which it may have an interest, where such loss is caused by fire or any of the extended coverage hazards and arises out of or is connected with the use of the premises as provided in this Agreement. 4. TERM of LEASE. The term of this lease is for the period set forth in Paragraph A. of the Eighth Amendment dated July 6, 1994, and Paragraph A. of the Tenth Amendment dated April 4, 1999, both as reproduced below: Eighth Amendment: A. Paragraph 1.3 of the concession Agreement is amended to include the following paragraph: "Providing Operator shall not be in default under the terms and conditions of this Agreement, it shall have the right at its option to extend the term of this Agreement for an additional five (5) year period, to commence on January 1, 2004 and to expire December 31, 2008. The percentages of the contract years under said extension are to be renegotiated for the five- 4 year period of 2004-2008. The negotiations shall be completed within the first ninety (90) days of the new five-year period or the Agreement becomes null and void." Tenth Amendment: A. Paragraph 1.3 of the Concession Agreement is amended to include the following paragraph: "Providing Operator shall not be in default under the terms and conditions of this Agreement, it shall have the right at its option to extend the term of this Agreement for an additional seven (7) year period, to commence on January 1,2009 and to expire December 31, 2015: The percentages of the contract years under said extension are to be renegotiated for the seven-year period of 2009-2015. The negotiations shall be completed within the first ninety (90) days of the new seven-year period or the Agreement becomes null and void." S. LEASED PREMISES and RENT. The leased premises and the rent for the leased premises is set forth in " Paragraph B." of the Tenth Ameridment dated April 4, 1999, as reproduced below: B. Paragraph 4.2 of the Concession Agreement is hereby modified to substitute the following therefore in its entirety: 4.2 Payments by Operator Operator, in consideration of this Agreement, hereby covenants and agrees to pay to the County the following sums, to-wit: White Lake Oaks Operator shall pay rental of ten percent (10%) of total annual gross sales and twenty-five percent (25%) of utility costs. Addison Oaks Conference Center Operator shall pay rental of eight percent (8%) of total annual gross sales and twenty-five percent (25%) of utility costs. Springfield Oaks Golf Clubhouse 5 percent (12%) of the total percent (12%) of the total Operator shall pay as rental ten percent (10%) of the total annual gross sates or one hundred percent (100%) of utility costs, whichever is greater. Springfield Oaks Activities Center Operator shall pay as rental ten percent (10%) of the total annual gross sales. Addison Oaks Concession Stand Operator shall pay as rental twelve percent (12%) of the total annual gross sales. Waterford Oaks Activity Center Operator shall pay as rental ten percent (10%) of the total annual gross sales. Red Oaks Wave Pool Concession Stand Operator shall pay as rental eleven percent (11%) of the total annual gross sales and one hundred percent (100%) of utility costs. Waterford Oaks Wave Pool Concession Stand Operator shall pay as rental eleven percent (11°/o) of the total annual gloss sales and one hundred percent (100%) of the utility costs. Groveland Oaks Concession Stand Operator shall pay as rental twelve annual gross sales. Independence Oaks Concession Stand Operator shall pay as rental twelve annual gross sales. Glen Oaks Golf Clubhouse Operator shall pay as rental thirteen and one-half percent (13.5%) of the total annual gross sales on the banquet facility, twelve percent (12%) of the total annual gross sales on the grill room facility and fifty percent (50%) of the utility costs. Lyon Oaks Golf Clubhouse 6 After completion of the clubhouse banquet facility, Operator shall pay as rental three percent (3%) of the total annual gross sales up to $500,000 and thirteen and one-haff percent (13.5%) of total annual gross sales over $500,000 on the banquet facility and grill room and twenty-five percent (25%) of the utility costs through December 31, 2000; three percent (3%) of the total annual gross sales up to $500,000 and thirteen and one-half percent (13.5%) of total annual gross sales over $500,000 on the banquet facility and grill room and twenty-five percent (25%) of the utility costs through December 31, 2001; nine percent (9%) of the total annual gross sales up to $500,000 and thirteen and one-half percent (13.5%) of total annual gross sales over $500,000 on the banquet facility and grill room and twenty-five percent (25%) of the utility costs through December 31, 2002; twelve percent (12%) of the total annual gross sales up to $500,000 and thirteen and one-half percent (13.5%) of total annual gross sales over $500,000 on the banquet facility and grill mom and twenty-five percent (25%) of the utility costs through December 31, 2003. The term gross sales shall include the gross amount of all sales of every kind and description made in, upon or resulting from the conduct of the business of Operator upon the various recreational facilities covered by this Agreement, but after deduction there from refunds made in the normal course of business and amounts paid for sales tax. Net proceeds from vending machines shall be included in gross sales. All percentage payments provided hereunder shall be payable quarterly, not later than the thirtieth (30th) day following the end of the first three (3) months of operation and the end of each three (3) month period thereafter, and shall be based upon reports furnished by Operator to the County with such payments. Operator shall furnish to the County within sixty (60) days after the closing of each calendar year a report certified to by an officer of Operator, showing Operator's gross receipts during the preceding calendar year, the amount of any accumulated prior deficiency in percentage payments, and the net percentage payment, if 7 any, owing hereunder for such period, provided that, if at the end of any quarter it be detennined that Operator has paid for said year to date a greater sum than would have been payable under the provisions hereof for such excess payment. 6. RENT FOR LYON OAKS AFTER DECEMBER 31, 2003. The rent for Lyon Oaks through December 31, 2008 will be twelve percent (12%) of the total annual gross sales up to $500,000 and thirteen and one-half percent (13,5%) of total annual gross sales over $500,000 and twenty-five percent (25%) of the utility costs. 7. ENTIRE AGREEMENT. This Lease Agreement and the terms and conditions of the original Agreement dated April 25, 1974 as revised on June 20, 1979, and the subsequent ten amendments incorporated herein by reference and adopted as part of this Agreement (See Attachment 1) constitute and represent the entire agreement and understanding between the parties, including Parks, and supersedes any and all other prior oral or written understandings, communications, agreements or Contracts between the Parties, including Parks, not incorporated by reference as part of this Lease Agreement The language of this Contract shall be construed as a whole according to its fair meaning, and not construed strictly for or against any Party. 8. AUTHORITY TO SIGN. The individual(s) signing this Lease Agreement on behalf of LESSEE certifies that he or she has authority to enter into this LEASE Agreement as evidenced by LESSEE'S attached Corporate Resolution dated April 7, 2005 (Attachment 2). IN WITNESS WHEREOF, the parties have executed this Lease Agreement effective the 14th day of December, 2006, and by such execution have ratified the previous Agreements and Amendments between PARKS and LESSEE as contained in Attachment 1. WITNESSED BY: LESSOR: County of Oakland a Michigan Municipal and Constitutional Corporation , P [:=-0-&AS• By: Bill Bullard, Jr., Chairperson Oakland County Board of Commissioners LESSEE: E.A. Fuller Oak Management Corporation By: Edward A. Fuller President and Secretary By: Janet Lekas Vice President and Treasurer 9 JANET J. LEKAS Vice President/Treasurer ATTACHMENT 2 UNANIMOUS CONSENT OF SHAREHOLDERS AND DIRECTOR OF E.A. FULLER OAK MANAGEMENT CORPORATION The undersigned, EDWARD A. FULLER and JANET J. LEIC.AS , being the only Shareholders and EDWARD A. FULLER, being the only Director of E. A. FULLER OAK MANAGEMENT CORPORATION, a Michigan corporation, do hereby consent to the adoption of the following Resolutions pursuant to Sections 450.1525 and 450.1407(2) of the Michigan Business Corporations Act: RESOLVED, that EDWARD A. FULLER_he_ancihereby is elected as the sole Director of said Corporation. FURTHER. RESOLVED, that the following persons be and are hereby elected to the positions set forth next to his or her name and to hold said positions within the Corporation until the next annual meeting or until any successors have been duly elected and qualified: EDWARD_A_EDLLER President/Secretary FURTHER RESOLVED, that the President of the Corporation, EDWARD A. FULLER, is authorized to sign and execute any and all papers, documents, etc. required by the State of Michigan Liquor Control Commission, and receive licenses at the offices of said Commission in lieu of their being mailed, FURTHER RESOLVED, that all of the actions of the officer(s) and director(s) of the Corporation taken since the last annual meeting be and they hereby are ratified and approved. (.1/ Date: April 7, 2005. Date: April 7, 2005. ...._ .. ARD A. FULLER lif eholder=. •1 6 le Dir -cto , JAil A if . , id ANET J4eCAS Sharehol iin - Resolution #08078 April 24, 2008 The Chairperson referred the resolution to the Planning and Building Committee and the Finance Committee. There were no objections. FISCAL NOTE (MISC #08078) May 22, 2008 BY: Finance Committee, Mike Rogers, Chairperson IN RE: PARKS AND RECREATION COMMISSION- B.A. FULLER OAK MANAGEMENT CORPORATION LEASE AMENDMENT TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS Chairperson, Ladies and Gentlemen: Pursuant to Rule XII-C of this Board, the Finance Committee has reviewed the above referenced Miscellaneous Resolution and finds: 1. The Oakland County Parks and Recreation Commission has had a Lease Agreement with E.A. Fuller Oak Management beginning April 25, 1974, which has been amended eleven (11) times, with the last being December 14, 2006 (M.R 406245). 2. Oakland County Parks and Recreation Commission has requested a twelfth amendment to revise rental payments for the various facilities for the year 2008. 3. The lease agreement provides that the lessee may extend the agreement for seven (7) years through 2015 provided it meets conditions in the agreement. Rental payments for the extension would remain at 2008 rates for this period of time. 4. No increase in revenues is projected at this time. 5. No budget amendment is recommended. FINANCE COMITTEE FINANCE COMMITTEE: Motion carried unanimously on a roll call vote with Rogers absent. APPROVE, THE FOREGONG RESOLIMON .5.-/24/6 V Resolution # 08078 May 22, 2008 Moved by Rogers supported by Nash the resolutions (with fiscal notes attached) on the Consent Agenda be adopted (with accompanying reour ts being-accepted). Vote on resolutions on the Consent Agenda: AYES: Burns, Coulter, Crawford, Douglas, Gersnenson, Gingell, Gosselin, Greimel, Jacobsen, Kowa'', Long, Middleton. Nash, Potts, Rogers, Scott, Spector, Woodward, Zack, Bullard. (20) NAYS: None. (0) A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the Consent Agenda were adopted (with accompanying reports buiiy iLptd). STATE OF MICHIGAN) COUNTY OF OAKLAND) I, Ruth Johnson, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and accurate copy of a resolution adopted by the Oakland County Board of Commissioners on May 22, 2008, with the original record thereof now remaining in my office. In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at Pontiac, Michigan this 22nd day of May, 2008. ede Ruth Johnson, County Clerk