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HomeMy WebLinkAbout82-39 - Cavanaugh Concessionaire Agreement BalboaRESOLUTION NO. d A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH AUTHORIZING THE MAYOR & CITY CLERK TO EXECUTE A CONCESSIONAIRE AGREEMENT BETWEEN THE CITY AND DOUGLAS CAVANAUGH FOR THE MAINTENANCE AND OPERATION OF THE BALBOA PIER • WHEREAS, there has been presented to the City Council of the City of Newport Beach a certain Concessionaire Agreement between the CITY OF NEWPORT BEACH and DOUGLAS CAVANAUGH in connection with the maintenance and operation of the Balboa Pier, a copy of which is attached hereto, marked Exhibit "A" and incorporated herein as though fully set forth herein; and WHEREAS, the City Council has reviewed the terms and conditions of said Concessionaire Agreement and finds them to be fair and equitable and that it would be in the best interests of the City to execute said Concessionaire Agreement. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach that said Concessionaire Agreement above - described is approved, and the Mayor and City Clerk are hereby authorized and directed to execute same on behalf of the City of Newport Beach. ADOPTED this 8th day of March. , 1982. Mayor fro Tem ATTEST: City Clerk • 030882 PR • CONCESSION BALBOA PIER This agreement, made and entered into this day of , 1982, between the CITY OF NEWPORT BEACH, a municipal corporation, hereinafter referred to as "City," and hereinafter referred to as "Concessionaire" W I T N E S S E T H: WHEREAS, the City is the owner and.is in possession and control of a certain pier known as :Balboa Pier, located in the City of Newport Beach, which extends into and over the water of the Pacific Ocean, at the southerly extension of Main Street, which pier is used by the general public for the purpose of fishing and other recreation; and WHEREAS, it is the opinion of the City Council that it is advisable that the operation and the maintenance of the concession on said pier be continued for the use and convenience of the public and all persons using the pier for fishing and recreational purposes; and WHEREAS, Concessionaire has made a proposal to City to operate and maintain the concession on the Balboa Pier; and WHEREAS, the proposed arrangement is mutually agreeable to City and the Concessionaire, NOW, THEREFORE, in consideration of the payments • hereinafter specified and the faithful performance of the other covenants of this agreement by Concessionaire, City hereby grants to Concessionaire a concession, privilege and right to operate lunch stands, bait and tackle concessions on said pier subject to the following terms, covenants and conditions: 1. Concession: (a) City hereby grants to Concessionaire the exclusive right, privilege and concession to conduct lunch stands, bait and fishing tackle concessions on the Balboa Pier for the vending of light foods and sandwiches, soft drinks, coffee, ice • cream or ice cream products, cigars, cigarettes and tobaccos, candies, chewing gum, suntan lotions, film, sunglasses, and other items of fishing tackle, lines, hookas, lure and weights. The sale of said items shall be subject to the prior written approval of the City Manager. Concessionaire agrees to provide all necessary fixtures, goods, merchandise, labor and equipment required for the vending of the above items or any other items permitted to be sold. (b) The consumption of alcoholic beverages on the pier is prohibited. Concessionaire shall not seek a license to sell alcoholic beverages on the pier. (c) City reserves the right to prohibit the use, display, sale or rental of any machine, item or article which it deems objectionable or beyond the scope of merchandise deemed necessary by City for proper service to the public. This includes but is not limited to the right to restrict or prohibit vending machines of all kinds and machines producing music or any other noise or sound. Prices shall be fired by Concessionaire, but must not be in excess of prevailing prices in the City of Newport Beach for similar products, and City reserves the right to establish and from time to time revise a- schedule of maximum prices for any or all items sold or rented by the public by Concessionaire. All food and beverage products sold shall be of high quality, and failure to maintain quality deemed satisfactory by City shall be deemed a breach of this agreement. Unimpaired use of the Balboa Pier by the public is to be maintained from the time the concession opens for business. Concessionaire may block southerly 80 feet • during the construction phase of the project for a maximum period of 75 days from the date of this agreement. - 2 - (d) Concessionaire shall be subject to all state and local laws, rules and regulations and shall pay taxes lawfully assessed, prior to delinquency, and shall obtain and display at all times a business license and all permits required by the appropriate county, city or state health authorities certifying • that the premises occupied, the equipment, the products sold, and the method of selling meet all current regulations, including health regulations. 2. Term of Agreement: (a) This agreement shall be in effect for a period of 10 years from the date of execution unless sooner terminated as hereinafter provided. At the expiration of this term the Concessionaire shall have first right of refusal in continuing to operate the concession without the necessity of the operation going out to bid. (b) Concessionaire may remain open for business daily at any time, but shall keep the lunch stands, bait and tackle concessions open for business on every day, at least from 10:00 a.m. to 6:00 p.m., with the option to be open from 7 a.m. to 10:00 p.m., from June 15 to September 30, all dates inclusive, during each year. Different dates and hours may be fixed by Concessionaire with the approval of the City. Concessionaire shall use his best efforts to open on weekends during the winter months, depending on the weather and if there is sufficient demand. 3. Compensation to City: Concessionaire shall pay to City the following amounts as consideration for this license: (a) From the opening of the concession for business throughout the concession term, Concessionaire shall pay to City a monthly payment of $1,000.00 per month for the months of June, July, August and September, plus five and one -half percent (5.5 %) of the monthly gross receipts for each and every month of the term, • including the months listed above. Payment shall be made to the City monthly on or before the 20th day of the month following the month of operation. If Concessionaire is prevented from operating said concession during a part of June, July, August or September, by any cause beyond his control, the required fixed monthly payment shall be prorated in the ratio which the actual operating period - 3 -- bears to the full month for which said fixed monthly payment is required. City shall be the sole judge as to whether the cause preventing operation is beyond control of Concessionaire. (b) The term "gross receipts" wherever used in this agreement is intended to and shall mean all monies, property • or any other thing of value received by Concessionaire through the operation of said concession, or from any other business or activity carried on upon said area or any portion thereof by Concessionaire, or others with his approval, without any deduction or deductions; it being understood, however, that the term "gross receipts" shall not include any sales or excise taxes imposed by any governmental entity and collected by Concessionaire or deposits made with Concessionaire to guarantee the return of rental equipment. (c) Concessionaire covenants and agrees that it will,_ at all times during the term of this lease, keep or cause to be kept true and complete books, records and accounts of all financial transactions in the operation of all businesses, concessions, services, and activities of whatsoever nature conducted on or from said premises. The records must be supported by documents from which the original entry of the transaction was made, including sales slips, cash register tapes and purchases invoices. All sales and charges shall be recorded by means of cash registers which display to the customers the amounts of the transactions certifying the amounts recorded. The registers shall be equipped with devices which lock in daily sales totals, and which shall record on tapes the transaction numbers and sales details. At the end of each day the tape will record the total sales for that day and the Concessionaire will verify the total gross sales each day by signing his or her name on the tape. (d) Concessionaire covenants and agrees to deliver to City, not later than the 10th day of each month, a true and • correct statement of all gross receipts and gross sales for the preceding calendar month, showing separately: (1) The gross sales and gross receipts from each business, concession, service, coin operated machine or activity conducted on or from said premises. - 4 - • • (2) The total gross sales and gross receipts itemized as to each of the separate categories of gross sales and gross receipts upon which the percentage rentals herein reserved are based. (e) All books, cash register tapes, records and accounts of every kind or nature kept by the Concessionaire relating to the operation of the concessions shall, at all reasonable time, be open and made available for inspection or audit by City, its agents or employees or the duly authorized agents and employees of City upon request. (f) City and the duly authorized agents and employees of City shall have the right to audit any or all such books, records and accounts for the purpose of verifying the percentage payment required to be paid to the City hereunder. If such audit shall show that the percentage payment required to be paid the City is greater than the amount reported or paid by Concessionaire, Concessionaire covenants and agrees to immediately pay the costs of the audit, as well as the additional rental shown to be payable by Concessionaire to City; otherwise:, such costs shall be borne by City. City reserves the right to install any accounting devices or machines, with or without personnel, for the purposes of accounting or audit. If such audit shall disclose any willful and substantial inaccuracies, this agreement at the option of City may be thereupon cancelled and terminated. (g) All payments shall be to the City at the office of the Director of Finance in the City Hail. 4. Posting of Rates and Prices, Advertising Signs, Trade Name: (a) Concessionaire shall post rates and prices on said pier at such places as may be designated by City. (b) All advertising matter to be published or circulated by or on behalf of Concessionaire shall be subject to approval in writing by City whose approval or denial shall, if possible, be granted within five (5) working days from the date submitted by Concessionaire for review. - 5 - (c) Concessionaire shall not place or allow any signs, placards, or advertising matter to be placed or maintained on, or attached to, the buildings or elsewhere on said pier or associated parking lot without the prior written consent of City, and such business signs shall be placed, maintained and attached • in such manner as City prescribed prior to such placing. Any signs placed in said area shall be removed promptly upon request by City. (d) Concessionaire shall not use any trade name, style or title in any way in the conduct of the business without the same having been approved by City in writing. Concessionaire shall protect and hold City harmless against all claims and actions arising from use of any name, style or title even though the same has received prior approval of City. 5. Assignment: This Concession Agreement shall not be sold, assigned, transferred, mortgaged, pledged or hypothecated by Concessionaire without the prior written consent of City, nor shall Concessionaire sublet the premises or any part thereof or permit the same to be occupied by any other person whomsoever without the prior written approval of City whose consent shall not be unreasonably withheld. 6. Operation of Business: Concessionaire agrees to assume said right, privilege and concession hereby granted and to operate said concessions on the Balboa Pier for the purposes and in the manner and according to the terms and conditions herein stated, reserving, however, to City the right of ingress and egress to inspect said piers and all buildings, equipment and fixtures thereon, as deemed necessary by City. In accepting the concession hereby granted, Concessionaire understands that the volume of business to be done and the quantity of food, beverages and service to the public to be required are subject to fluctuation and depend upon season and the • weather and other unpredictable factors. Notwithstanding the uncertainties involved, Concessionaire agrees to supply the demand as it arises and to maintain an adequate supply of labor, food, beverages and equipment to do so. Concessionaire further agrees to use his best effort to upgrade and encourage business and public use of said pier. - 6 7. Utilities and Severage: (a) Newport Beach water is available to the buildings on the pier. Concessionaire shall be entitled to water service under the same terms as any other occupant of the premises of the City and shall pay the same fees,.rate or rates • as any other occupant. (b) Newport Beach sewer service is not available to the building on the pier. It is understood that a new sewage holding tank is required. Concessionaire will be responsible for the cost of servicing the holding tank. Concessionaire shall furnish and install it subject to specifications approved by City's Public Works Department. Concessionaire shall provide and maintain, at its sole cost and expense, any chemical toilets and other appurtenant equipment for sewage disposal required by the Orange County Health Department in the operation of the business. Concessionaire shall make arrangements for such other utility services as are necessary for the operation of the businesses and shall promptly pay all charges for utilities when due. (c) City will provide garbage and refuse pickup service on the Balboa Pier. (d) There is no commercial gas available on the pier. A new commercial gas service shall be installed by the Concessionaire subject to specifications approved by City's Public Works Department. (e) There is a light duty electrical service to the concession building. Should a larger capacity service be required or should the existing light duty service require re- placement or repair to place the concession building into operation, said work shall be accomplished at the expense of Concessionaire. 8. Parking Restrictions: (a) Concessionaire agrees to permit only one • vehicle owned.and operated by him or his employees at any one time on the pier for the purpose of serving his business. Said vehicle shall not be parked on the pier any longer than necessary for completion of the task at hand. - 7 - (b) Vendors and deliveryman serving the concession may drive vehicles on the pier subject to a maximum gross vehicle weight of 10,000 pounds; and to any other restrictions imposed by the.City relative to vehicle size, weight or other factors. (c) The City will provide a total of two (2) parking permits to the Concessionaire for use of the Balboa Pier parking • lot by himself or his employees. 9. Finishing Buildings and Furnishing Fixtures: (a) It is mutually understood that the existing concession building on the Balboa Pier has been carefully examined by Concessionaire prior to the time his proposal was submitted to the City. It is further understood that City is not responsible for having the exterior or interior of said building finished or remodeled. Concessionaire agrees to finish or remodel the interior of the building and install all cabinets, fixtures and equipment and maintain the same during the term hereof and connect all utilities necessary for Concessionaire's operations hereunder. Concessionaire shall pay all costs of doing the work hereunder. All work on the buildings by Concessionaire shall be done in accordance with plans and specifications approved by the Building Department, and pursuant to a building permit issued by City. Only first -class materials shall be used and all work must be performed and completed.in a good and workmanlike manner by duly licensed contractor(s). All cabinets and fixtures shall be of first -class materials. The type, style, materials and workmanship of the cabinets and fixtures shall be subject to the approval of City, and, if any such are disapproved, they shall be reconstructed or replaced as necessary to obtain said approval. (b) Concessionaire shall pay in full for the completion of the interior of the buildings as herein required at the time the work is done. (c) Concessionaire acrrees to refurbish the exterior • of the building including sandblasting, repairing, and finishing. (d) All fixtures and equipment installed by Concessionaire shall remain the property of Concessionaire, except to the extent any such fixtures or eqW pment are attached to and made a part of the building, in which ease they shall become the property of the City, at no expense to City. Upon termination of this agreement, all rights of Concessionaire shall end and Concessionaire shall, within thirty (30) days after the date of termination, remove all equipment and materials belonging to him •and, in the event he fails to do so, all equipment and materials remaining, shall be deemed abandoned by him and shall become the property of City, with full power and authority to control, use or dispose of same. 10. Ongoing Maintenance and Repairs. The buildings and the pipe lines, conduits, electrical equipment and other equipment on said pier are the property of City. Except as otherwise provided herein, the ongoing maintenance and repair of the electrical service lines outside of the building, the water supply piping outside of the building and the gas lines outside of the building shall be the responsibility of the City. City shall. cause any of these necessary maintenance or repairs to be accomplished with ten (10) days from receipt of written notice from Concessionaire. Concessionaire agrees to keep the building and all said interior equipment and appurtenances in good condition and repair to the satisfaction of the City and shall, as necessary, replace any such equipment, at its own expense, and shall turn the above - mentioned equipment over to the City at the end of other termination of this agreement in as good condition as it is at the time of execution of this agreement, reasonable wear excepted. Concessionaire shall bring the existing building up to City Building Code standards, when applicable, with ninety (90) days after execution hereof. Concessionaire's ongoing maintenance and repair obligation includes, but is not limited. to, the sewage holding tank, the exterior walls and roof, interior partitions of the building, window frames, doors, interior and exterior painting, and repair and replacement of windows in the buildings. If any exterior or interior painting or repair is required and Concessionaire fails • or refuses to so paint or repair, City shall cause the painting or repair to be done at the expense of Concessionaire, after ten (10) days' written notice from City to do specific items of maintenance or repair as required herein. - 9 - Concessionaire shall reimburse the City for such cost within fifteen (15) days after being billed therefor to the City. In addition, the exterior color scheme and signing of all pier buildings shall be subject to the approval of the City Manager. 11. Financial Contribution by the City: In order to • assist Concessionaire in placing the: City facility into operation, City shall provide $25,000 to be allocated to Concessionaire pursuant to specific approvals by the City Manager's office and the Public Works Director of billings and work progress reports. 12. Pier Areas Cleaning: Concessionaire shall keep the southerly 80 feet of the Balboa Pier (the area where the deck widens), all benches and the areas set aside for fish cleaning on the pier, and the exterior and interior of the building clean and sanitary and free from rubbish, debris, and garbage of every kind at all times throughout the term of this Concession Agreement, to the satisfaction of the City Manager. 13. Failure to Maintain and Clean: If Concessionaire fails to comply with the requirements of Paragraphs 10 and 12 of this agreement with regard to maintenance and cleaning of the buildings, equipment and pier area, the City Manager shall notify Concessionaire by personal service or by certified mail of such failure, and if the deficiencies are not corrected by Concessionaire within five (5) days following the receipt of the notice, the City Manager may proceed to have the work done and Concessionaire shall be obligated to reimburse City for the costs thereof. Failure on the part of Concessionaire to reimburse City within thirty (30) days receipt of such billing shall result in automatic termination of this agreement. 14. Independent Contractor: City shall have no interest in the operation of the lunch stands, bait or tackle concessions, and shall not be responsible for any injury or damage to the person or property of Concessionaire suffered or sustained in the operation • of the lunch stands or bait and tackle concessions. It is under- stood and agreed that Concessionaire operates both the lunch stands bait and tackle concessions as an independent contractor. - 10 - 15. Hold Harmless - Insurance: (a) Concessionaire agrees to release, and to protect and save harmless, City and its officers, agents and employees from any and all claims, loss or liability on account of injury, loss or injury to any person or persons or property suffered or sustained • in, on, or about the premises or elsewhere by any person or persons whomsoever in.any manner directly or indirectly arising out of or by reason of the conduct of Concessionaire's business or the use of equipment, consumption of food or drink or the use or occupancy of said premises by Concessionaire or by any person claiming under Concessionaire. (b) Concessionaire shall, at all times during the term of this agreement, maintain in full force and effect, with respect to this agreement, a policy or policies of comprehensive liability insurance (bodily injury, including death, property damage, product's liability, contractual and automobile) with minimum limits of Five Hundred Thousand Dollars ($500,000.00) combined single limit, naming the City and its officers, agents, and employees, as additional insured and further providing an endorsement as follows: "1. The City of Newport Beach, its officers and employees are hereby declared to be additional insureds in the policy described insofar as they may be held liable for injuries or death to a person or persons, or damage to property occurring in or about the leased premises, whether or not caused by their sole or contributing negligence. This policy shall be primary and non - contributing with any other insurance available to the City of Newport Beach, and will include a severability of interest clause. "2. If this policy is cancelled or materially altered so as to affect the coverages, at least thirty (30) days' prior • written notice by registered mail of such cancellation or alteration will be sent to the City of Newport Beach, in care of the City Manager, 3300 Newport Boulevard, P. O. Box 1768, Newport Beach, California 92663- 3884." - 11 - • • (c) Said policy or policies shall be in a form satisfactory to City and certificates issued by company shall be submitted to City concurrently of this agreement. Certificates for each and a policy or policies effective during the term of shall be submitted to City at least twenty (20) effective date of such policy or policies. the insuring with the execution ay new or renewal this agreement days prior to the 16. Workers' Compensation Insurance: Concessionaire shall obtain and maintain any necessary workers' compensation insurance for all employees of Concessionaire, and shall provide City with a certificate evidencing such insurance coverage issued by an admitted insurer or a consent to a self- insure issued by the State of California, Director of Industrial Relations. 17. Destruction of Premises and Fire Insurance: (a) It is understood and agreed that City need not replace the buildings, piers, or any part thereof, or any of the City equipment used in connection with Concessionaire's operations under this Concession Agreement in case the same should be destroyed by fire, accident, catastrophe or any other cause, including obsolescense, deterioration or decay. Should the buildings, piers or said equipment be destroyed or damaged to the extent that construction is needed, City has complete discretion to determine whether said building, pier, or equipment shall be restored or reconstructed and 'City may give Concessionaire written notice of its intent to restore or repair said building, pier.or equipment within sixty (60) days of damage or destruction. Concessionaire may elect to terminate this agreement upon thirty (30) days' notice to City after City's determination not to restore or repair the buildings. If any such damage or destruction should occur, Concessionaire's obligation to pay rent shall be suspended on the concession for the period of time his business operations are completely and necessarily suspended. (b) Concessionaire agrees to maintain a fire insurance policy satisfactory to the City Attorney with extended coverage on the fixtures and equipment used by Concessionaire, insuring the same - 12 - to the full insurable value thereof. In the event of destruction, loss or damage to Concessionaire's fixtures, Concessionaire shall begin work to repair or replace damaged or destroyed fixtures and equipment within thirty (30) days after notice from the City to do so and complete the same as rapidly as possible. Should the cost of replacing, repairing and restoring such fixtures and equipment • exceed the insurance proceeds, Concessionaire shall pay the remainder of such cost. Notwithstanding the interruption of the business of Concessionaire while work of replacing fixtures and equipment is being done, this agreement shall continue in effect. (c) Should the pier deteriorate, or be damaged, demolished or destroyed, for any reason, City shall not be obliged to Concessionaire, in any fashion, for any loss of trade, business, goodwill, fixtures, equipment or other property of Concessionaire resulting from such demolition or destruction. 18. Administration of Agreement: For the purpose of the administration of this agreement by City, "City" shall mean the City Manager and any officer and employee of the City authorized by him to administer the contract. If Concessionaire is dissatisfied with any action or decision of the City, Concessionaire may take the matter to the City Council for review. The decision by the City Council shall be final. 19. Notices: (a) All notices herein provided to be given, or which may be given, by either party to the other, shall be deemed to have been fully given when made in writing and deposited in the United States mail at Newport Beach, California, certified and postage prepaid, and addresses as follows: To the Concessionaire at: Douglas S. Cavanaugh Ralph L. Kosmides 114 Garnet Street or 1906 Court Street Balboa Island, CA 92662 Newport Beach, CA 92663 And to the City at: • City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92663 -3884 Attention: City Manager. - 13 -- • • (b) The address to which the notices shall or may be mailed as aforesaid by either party shall or may be changed by written notice, given by such party to the other, as hereinbefore provided; but, nothing herein contained shall preclude the giving of any such notice by personal service. 20. Contract Rights Only: The parties agree that Concessionaire is not a lessee or tenant of the premises or any part thereof and that the only rights of Concessionaire are those provided in this agreement. Should Concessionaire be deemed a lessee or tenant, Concessionaire hereby specifically waives all rights under Section 1942 of the Civil Code of the State of California. 21. Cost of Litigation. Concessionaire and City agree that if any action is brought by either party to enforce the terms of this agreement, the cost and expenses of said action, including reasonable attorneys' fees, shall be borne by the party who is found to have violated the terms of this agreement. 22. Limited Waiver: No waiver by City of any term or condition of the contract or of any breach thereof by Concessionaire shall constitute a waiver of any other term or condition or of any other or future breach. 23. Automatic Termination: Should any person other than Concessionaire secure possession of the licenses portions of the Balboa Pier or any part thereof or secure any rights under this contract by a writ of attachment or execution or by any voluntary or involuntary assignment or by any petition, receivership or proceedings in bankruptcy or any other operation of law whatsoever, and remain in possession or maintain any right or rights for a period of five (5) days, this agreement shall automatically terminate without any action on part of City, and City may enter and take possession of the premises, buildings and fixtures and remove all persons and property therefrom notwithstanding any other provisions of law or of this agreement. - 14 - • 24. Termination: Should Concessionaire fail to fully perform any term or covenant of this agreement, City may provide Concessionaire with written notice of default which shall require Concessionaire to correct or remedy any such failure within ten (10) days of receipt of service of said notice. Should Concessionaire fail to correct or remedy such default or defaults, this agreement shall be deemed terminated upon the expiration of said ten (10) day period, and City may re -enter and control the premises and remove any property of Concessionaire found in the premises. Concessionaire's obligation to pay rent shall continue after re -entry until such time as City shall relet the premises or release Concessionaire from its obligation to pay rent by written notice. 25. Prompt Performance Required: Time is of the essence of this agreement. IN WITNESS WHEREOF, the parties have executed this agreement as of the day and year first above written. ATTEST: City Clerk APPROVED AS TO FORM: i City Attorney CITY OF NEWPORT BEACH, a Municipal Corporation By LM - 15 - Mayor CITY CONCESSIONAIRE