Loading...
4.5 SR 10-02-2023 Request for Action To Item Number Mayor and City Council 4.5 Agenda Section Meeting Date Prepared by Consent October 2, 2023 Cal Portner, City Administrator Item Description Reviewed by Amend Naming Rights Agreement with Furniture and Things Reviewed by Action Requested Approve, by motion, an amendment to the Elk River Multipurpose Facility Naming Rights Agreement. Background/Discussion In October of 2020, the City of Elk River approved an agreement with Steve Hickman, owner of Furniture and Things for the rights as the primary sponsor of the community’s event center. Article III of the agreement calls for an annual payment on the annual anniversary of the effective date of the agreement. Furniture and Things representatives have asked to make their contribution in 12 monthly payments instead of one lump sum. The city, grateful for their generous support and partnership has no concerns making this accommodation. Financial Impact N/A Mission/Policy/Goal The Elk River Vision Attachments  Amendment  Elk River Multipurpose Facility Naming Rights Agreement The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity. Updated: August 2020 ELK RIVER MULTI-PURPOSE FACILITY NAMING RIGHTS AGREEMENT th THIS NAMING RIGHTS AGREEMENT 19 day of October, CITY OF ELK RIVER, a Minnesota municipal FURNITURE & THINGS, INC., a Minnesota Corporation Primary RECITALS A. The City of Elk River owns the Elk River multipurpose f address of 1000 School Street, Elk River, MN 55330. B. Primary Sponsor is a furniture retailer located at 15612 Jarvis Street NW Elk River, MN 55330 with the intent of attaining exclusive naming rights to the Facility. C. The City and Primary Sponsor enter into this Agreement whereby in exchange for Primary agreement to make initial and annually recurring Contributions (as hereinafter defined) to the City for deposit to the Facility fund, the City agrees to grant to Primary Sponsor the naming rights for the Facility, as set forth and agreed to in this Agreement. D. Other than the naming rights set forth and agreed to in this Agreement, the City is not giving Primary Sponsor anything of value for the Contributions. AGREEMENT NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING RECITALS, THE MUTUAL PROMISES AND CONSIDERATIONS SET FORTH BELOW, AND OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, THE CITY AND PRIMARY SPONSOR AGREE AS FOLLOWS: Article I Facility Name and Naming Rights 1. Facility. The City grants to Primary Sponsor exclusive naming rights for the Facility. 2. Facility Name and Logo. The City and Primary Sponsor will work together to create a name and logo for the Facility that showcases Primary a. The name and logo will be agreed on by the parties and approved by the Elk River City Council. 3. Facility Signage and Related Naming Rights Assets. a. Primary Sponsor will be permitted Facility signage as listed and depicted in Exhibit A, which is attached hereto and incorporated herein. b. In addition to signage, Primary Sponsor is granted the related naming rights assets enumerated and depicted in Exhibit A. c. The City will fabricate and install the signage and related naming rights assets and will own, maintain, and replace (if required due to normal wear and tear) during the term of this Agreement. d. The City and Primary Sponsor will work together to develop a signage package and a budget for the signage and additional naming rights assets. The City will pay the first $65,000 in costs for the initial fabrication and installation of the signage and additional naming rights assets. Primary Sponsor will be responsible for any costs in excess of $65,000. e. Primary Sponsor will also be responsible for any future costs for signage or other naming rights assets related to a request by Primary Sponsor to modify or change the name or logo of the Facility. Article II Exclusivity 1. Exclusivity. Primary Sponsor will have category exclusivity for all advertising within the defined as a retail business engaged exclusively or primarily in furniture and/or garden center sales. By way of example, this would include, but not be limited to, businesses such as Hom Furniture, Ashley Furniture, By The Yard, etc. Competitors do not include businesses such as Target, Walmart, Menards, etc., that may sell furniture and/or have a home and garden center, but are not engaged exclusively or primarily in retail furniture and/or home and garden center sales or outdoor sheds and furnishings. 2. Secondary Sponsors. The City reserves the right to sell advertising and entitlement to secondary sponsors, excluding Competitors Sponsors, as set forth herein for naming of other current or future physical spaces within the Facility, including the two ice rinks, the turf facility, the senior center, locker rooms, conference rooms, the second level event center, and such other areas as may be delineated or added in the future. The City also reserves the right to sell entitlement to Secondary Sponsors for naming of other Facility assets including, but not limited to, dasher board signs, Zamboni wraps, etc. Article III Contribution Primary Sixty-Five Thousand and 00/100 dollars ($65,000.00) payable in full on the Effective Date of this Agreement. Thereafter, on or before each annual anniversary of the Effective Date, each year during the term of this Agreement, Primary Sponsor shall make an annual contribution of Sixty- Five Thousand and 00/100 dollars ($65,000.00). 2 Article IV Relationship of Parties; No Property Interest 1. Relationship of the Parties. Under this Agreement, the parties shall at all times be acting and performing as independent contractors. Nothing contained in this Agreement shall be construed to create a joint venture, principal and agent, or any similar legal or equitable relationship between the parties. Neither party shall have or exercise any control or direction over the methods by which the other party provides services contemplated by this Agreement. Nothing in this Agreement shall be construed to give Primary Sponsor any control over or responsibility for operation of the Facility. 2. No Property Interest. Nothing in this Agreement shall be construed as granting to Primary Sponsor any property interest in any City-owned property. The City maintains all of its rights as the fee owner of the Facility and all improvements thereon on behalf of itself and the public. Article V Term and Termination 1. Fixed Term. The Term of this Agreement shall commence on the Effective Date and th remain in effect for a period of fifteen (15) years, until the 15 anniversary of the Effective Date 2. Early Termination. a. Early termination by Primary Sponsor. Primary Sponsor may terminate this thth Agreement for any reason, effective on either the fifth (5) or tenth (10) written notice of its intent to terminate. If Primary Sponsor terminates this th Agreement on the fifth (5) anniversary of the Effective Date, Primary Sponsor shall pay to the City, at the time of its written notice of termination, a $65,000 early th termination fee. If Primary Sponsor terminates this Agreement on the tenth (10) anniversary of the Effective Date, Primary Sponsor shall pay to the City, at the time of its written notice of termination, a $32,500 early termination fee. b. Early Termination for Cause. Either party may terminate this Agreement for of Intent to Terminate the Agreement shall -terminating party shall have the opportunity to cure the purported breach or default. If either party fails to cure and Good Cause continues to exist following the applicable cure period, the other party shall be entitled to terminate the Agreement or seek specific performance, and in any event, may sue for damages. In any action for damages under this Agreement, neither party shall be liable or responsible under any circumstances for consequential, incidental, indirect lost profit, or punitive damages of any kind. 3 c. ity to terminate includes, but is not limited to, the following: i. Any material breach of the terms, conditions, and obligations of this Agreement by Primary Sponsor; ii. Failure by Primary Sponsor to deliver the contributions provided for in Article III hereof. The Opt-out fee provided for in Article V(2)(a) hereof, or any required payment as set forth herein; iii. Any crime by Primary Sponsor or any principal or owner of Primary Sponsor that causes Primary Sponsor to come into disrepute in the greater Elk River Area; iv. Occurrence of insolvency or bankruptcy of Primary Sponsor, or upon the general assignment by Primary Sponsor for the benefit of creditors, or upon the consent of Primary Sponsor to the appointment of a receiver, trustee, or liquidator of all or substantially all of its property; or v. Occurrence of a Transfer Event which the City has not consented to, as provided in Article VII of this Agreement. d. Primary Sponsor to terminate includes, but is not limited to, the following: i. Any material breach of the terms, conditions, and obligations of this Agreement by the City; 3. Removal of Signs, Logos, and Marks. Upon termination or expiration of this Agreement, City shall have the right to remove all signs, logos, and marks in all locations throughout the Facility. 4. First Right of Renewal. a. Primary Sponsor shall have the first right to renew this Agreement beyond the Expiration Date by delivering written notice of its desire to do so at least one year before the Expiration Date. b. If Primary Sponsor provides notice of its desire to renew the Agreement, the parties will enter into a good faith negotiation to renew the Agreement on terms acceptable to both parties. All of the terms of the Agreement shall be subject to negotiation. c. If terms to a new Agreement are not agreed to six (6) months before the Expiration Date, the parties may, at their option, continue negotiations, but the City shall have the right to negotiate with third parties for a new Naming Rights Agreement and doing so will not constitute bad faith. d. This First Right of Renewal does not obligate either party to agree to a renewed agreement, nor to agree to any particular terms of a new agreement. The intent of 4 this Article V, Section 4 is simply to provide a minimum six-month (6-month) period during which Primary Sponsor shall have the exclusive right to negotiate with City to renew this Agreement. Article VI Indemnification; Insurance 1. Indemnification. Minnesota Statutes Chapter 466 or other applicable law, each party agrees to defend, hold harmless and indemnify the other Party against any and all claims, liabilities, damages, judgments, costs, incurred by the other Party that arises out of, or in failure to perform any contractual or other obligations, commitment, or undertaking under this Agreement. Each Party further agrees that it shall be responsible for its own acts and results thereof to the extent authorized by law and shall not be responsible for the acts of the other Party and results thereof. The provision of this Article shall survive the termination of the Agreement with respect to any claim, action, or proceeding that relates to acts or omissions during the term of this Agreement. 2. Insurance. The City shall maintain such insurance as is customarily maintained by owners of comparable facilities. Article VII Assignment 1. The City shall be free to assign any of its rights or obligations under this Agreement to any successor in interest to the City-owned property. 2. In the event Primary Sponsor shall propose to undergo a change in control, sell, assign, merge, reorganize, consolidate, or otherwise dispose of its business (any of the foregoing being a Primary Sponsor shall notify the City of such fact within thirty (30) days prior to such proposed Transfer Event. The notice shall state whether the Transfer Event will or could affect the exercise of Primary rights hereunder or whether it could result at any point in the renaming of the Facility and, if so, the new name proposed by Primary Sponsor or its successor. a. If a new name and/or logo for the Facility is proposed in connection with a Transfer Event, the new name and logo must be agreed to by the City and approved by the City Council in its sole discretion. 3. If, as a result of the Transfer Event, Primary Sponsor would not be the holder of rights under this Agreement, or Primary Sponsor is not the successor in the Transfer Event, then the e required. If the City consents, the successor in the Transfer Event shall assume all of the obligations of Primary Sponsor under this Agreement and shall have all of the rights and obligations of Primary Sponsor under this Agreement. 4. In the event that a proposed Transfer Event will result in the renaming of the Facility to a company whose business conflicts with a naming rights or other agreement the City has with respect to the Facility, or a company whose business practices could be detrimental to the public 5 image or reputation of the City or the Facility, in the sole discretion of the City, then the City shall have the right to terminate this Agreement by written notification within sixty (60) days after receiving notice of such proposed Transfer Event. In the event of such termination, Primary Sponsor shall be obligated to pay all funds contemplated by this Agreement to be due and payable through the Expiration Date. 5. No Transfer Event shall relieve Primary Sponsor and any successor entity from being jointly and severally liable for payment and performance of all obligations of Primary Sponsor under this Agreement if the City does not exercise its right of termination as provided in Section VII(4). Article VIII Notices All notices hereunder by either Party to the other shall be in writing. All notices, demands, or requests shall be deemed given when mailed, postage prepaid, registered or certified mail, return receipt requested. If to the City: If to Primary Sponsor: City Administrator Furniture & Things City of Elk River 15612 Jarvis Street NW 13065 Orono Parkway Elk River, MN 55330 Elk River, MN 55330 Article IX General Provisions 1. Amendments. Neither this Agreement nor any term or provision hereof may be changed, waived, discharged or terminated, except by a written instrument signed by the Parties hereto. 2. Interpretation of Agreement. The captions preceding the articles and sections of this Agreement have been inserted for convenience of reference only and such captions shall in no way define or limit the scope of intent of any provision of this Agreement. Unless otherwise provided herein, whenever the consent of the City is required to be obtained, the City may give or withhold such consent in its sole and absolute discretion. 3. Severability. If any provision of this Agreement or the application thereof to any person, entity, or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Agreement shall not be affected thereby, and each other provision of this Agreement shall be valid and be enforceable to the fullest extent permitted by law. 4. . In the event of a dispute regarding any provision of this Agreement, the Party not prevailing in such dispute shall pay any and all costs and expenses incurred by the other Party in enforcing or establishing its rights hereunder (whether or not such action is prosecuted to judgment), includi 6 5. Time of Essence. Time is of the essence with respect to all provisions of this Agreement in which a definite time for performance is specified including, but not limited to, the expiration of the term. 6. Cumulative Remedies. All rights and remedies of either party hereto set forth in this Agreement shall be cumulative, except as may otherwise be provided herein. 7. Survival of Indemnities. Termination of this Agreement shall not affect the right of the City or Primary Sponsor to enforce any and all indemnities and representations and warranties given or made to the other Party under this Agreement, nor shall it affect any provision of this Agreement that expressly states it shall survive termination hereof. 8. Entire Agreement; Exhibits. This Agreement, including exhibits, shall constitute the entire agreement of the Parties. Any and all prior agreements or understandings of the Parties shall, upon execution of this Agreement, be null and void. 9. Waiver. a. Any term or condition of this Agreement may be waived at any time by the Party entitled to the benefit thereof. The waiver of any term or condition shall not be construed as a waiver of any other term or condition of this Agreement. b. The failure of either Party to give notice or demand strict performance by the other of any of the terms, obligations, covenants or conditions set forth herein shall not be construed as a waiver or relinquishm remedy for or demand strict performance of said terms, obligations, covenants and conditions. c. The failure to terminate this Agreement for default shall not constitute a waiver of any remedies the non-defaulting Party would otherwise be entitled to demand. d. All waivers shall be done in writing to be valid. 10. Force Majeure. If the performance by any Party of any obligation set forth in this Agreement (other than the payment of money) is prevented by an act of God, force majeure or similar contingency or unexpected event beyond the control of any Party, such occurrence shall be considered a valid excuse for non-performance or delay in the performance of the obligations hereunder. 11. Compliance with Laws. In performing its obligations under this Agreement, each Party will comply with all local ordinances, state and federal statutes, orders, by-laws, regulations, and other laws of any applicable governmental entity or agency. 12. Costs and Expenses. Each Party must pay its own legal costs and expenses for the negotiation, preparation, and execution of this Agreement. 13. Governing Law and Jurisdiction. Any and all matters in dispute between the Parties arising from or relating to this Agreement shall be governed by, construed, and enforced in 7 accordance with the laws of the State of Minnesota and the exclusive jurisdiction for any claim or action arising out of or relating to this Agreement shall be the state or federal courts located in Sherburne County, State of Minnesota. 14. Section Headings. Section headings are for reference purposes only and are not intended to create substantive rights or obligations. 8 IN WITNESS WHEREOF, the parties have executed this agreement to be effective on the Effective Date noted above. City of Elk River Primary Sponsor By By John J. Dietz, Mayor ________________________ By By Tina Allard, City Clerk ________________________ 9 Exhibit A Naming Rights Signage and Assets SIGNAGE: Exterior Signage One large sign placement on the southwest corner of the Facility. Maximum square footage of sign to be as allowed by the City Zoning Code. Sign to be backlit. Branding and directional signage located throughout Elk River. Inclusion in monument signage located within close proximity to the Facility. Internal Signage Inclusion in a rotation of advertising messages displayed on a video wall located between the Premier Rink viewing windows. Inclusion of logo and brand messaging on the Facility-wide IPTV system. Integration into all interior directional signage and ancillary messaging found in the Facility. Opportunities to display marketing material on all Facility brochure racks and message boards. Facility logo printed at center ice in each ice rink. Logo placement on Facility staff uniforms or clothing. Four three-foot by eight-foot dasherboards strategically placed for maximum visibility in each ice rink. Four-sided center hung video display board in the main rink: o Logo placement on two six-foot corner apex slides o Logo placement on the six-foot by ten-foot sponsor panel facing the north side of the arena o Additional logo exposure and/or video exposure in an advertising rotation displayed on the video screens throughout events A-1 Field House Branding Logo imprinted on main field area in the Field House. One wall banner prominently featuring the logo and messaging. Senior Center Integration Facility logo displayed prominently on the main wall of the Senior Center. Opportunity to actively contribute to all programming made available to Senior Center members. On-Site Activation The opportunity to activate at a up to six (6) annually. Activation dates and details to be mutually agreed upon by both parties. Use of all or part of the Facility for up to (2) private events annually. Dates subject to availability and standard facility booking procedures. Digital Activation Inclusion on the official website and social media pages of the Facility. official Snapchat Filter. Inclusion in e-newsletters and other digital communication distributed by the City in connection with the Facility. City-Wide Exposure Entitlement of one community pavilion or field at Lion John Weicht Park. Branding at one field at the Youth Athletic Complex. Sponsorship of splash pad, skate park or pickle ball court at Orono Park. Exposure on highway and roadway directional signage as allowed by the governing jurisdictions. A-2