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HomeMy WebLinkAboutC-7053-1 - Concession Agreement - Corona del Mar State BeachCONCESSION AGREEMENT by and between CITY OF NEWPORT BEACH, a California municipal corporation "City" and BROTHERS HUSKEY, LLC. a California limited liability company "Concessionaire" Dated as of October 29, 2015 CONCESSION AGREEMENT THIS CONCESSION AGREEMENT ("Agreement") is made and entered into as of the 29th day of October, 2015 ("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California municipal corporation and charter city ("City"), and BROTHERS HUSKEY, LLC, a California limited liability company ("Concessionaire"). City and Concessionaire are at times individually referred to as "Party" and collectively as "Parties" herein. RECITALS A. Corona del Mar State Beach is part of the California State Parks system, and is operated by the City pursuant to the Operating Agreement by and between the City and the State of California, dated August 1, 1999 (the "Operating Agreement"). Pursuant to the Operating Agreement, City agreed "to develop, operate, control and maintain the premises as public recreational beach and park with related concession..." B. In September 2005, the concession located at Corona del Mar State Beach was closed to commence construction of the Corona del Mar Beachgoer Amenities Improvement Project ("Project"). The Project included the improvement of a one thousand forty-three (1,043) square foot concession facility which is depicted on Exhibit "A" and incorporated herein by this reference ("Premises"). C. The City issued a Request for Proposals for Concession Operations at Corona del Mar State Beach on December 9, 2011, and after a careful evaluation process, the City selected Rooster Cafe at CdM, LLC. The City and Rooster Cafe at CdM, LLC entered into the Corona del Mar State Beach Concession Agreement, dated March 13, 2012. D. On or around July 2015, Concessionaire entered into an agreement with Rooster Cafe at CdM, LLC to sublease the Premises. On July 10, 2015 Concessionaire began operating at the Premises under the name Tackle Box. E. On October 28, 2015, the City terminated the Corona del Mar State Beach Concession Agreement dated March 13, 2013. F. City and Concessionaire desire to enter into this month-to-month Agreement for the purpose of allowing Concessionaire to operate a concession area intended to provide food and drink service and beach rentals to beach visitors ("Concession"). Brothers Huskey, LLC Concession Agreement Page 2 G. In accordance with City Council Policy F-7, whenever an open bid process is not conducted, the City shall make specific findings setting forth the reasons thereof. The City did not conduct an open bid process for the month-to-month leasing of the Premises as the City is in the process of soliciting proposals for a new long-term concessionaire; in the interim, converting the property to another use or changing the current concessionaire of the property would result in loss in revenue, excessive vacancy, and relocation or severance costs, which would outweigh other financial benefits. Although no appraisal was conducted, Rent, as defined herein, is comparable to current market rates to ensure that revenue is equivalent to the open market value of the highest and best use of the Premises and the highest financial return. NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt of which is hereby acknowledged, the Parties hereto agree as follows: AGREEMENT 1. DEFINITIONS 1.1 General Definitions. As used in this Agreement, the following words and phrases shall have the following meanings: (a) Alteration — any improvements, additions, alterations, changes, or modifications of the Premises made by Concessionaire including, but not limited to fixtures and signage. (b) Authorized City Representative — the City Manager or his/her designee. (c) Expiration - the lapse of the time specified as the Term of this Agreement, including any extension of the Term resulting from the exercise of an option to extend. (d) Good Condition - neat and broom -clean, and is equivalent to similar phrases referring to physical adequacy in appearance and for use. (e) Law - any judicial decision, statute, constitution, ordinance, resolution, regulation, rule, administrative order, or other requirement of any municipal, county, state, federal, or other government agency or authority having jurisdiction over the parties hereto or the Premises. (f) Maintenance or Maintain - repairs, replacement, maintenance, repainting, and cleaning. (g) Person - one or more natural persons, or legal entities, including, without limitation, partnerships, corporations, trusts, estates, associations, or a combination of natural persons and legal entities. Brothers Huskey, LLC Concession Agreement Page 3 (h) Provision - any term, covenant, condition, or clause in this Agreement that defines, establishes, or limits the performance required or permitted by either party. (i) Rent — includes Base Rent, Percentage Rent, taxes, and other similar charges payable by Concessionaire under the provisions of this Agreement. (j) Successor - assignee, transferee, personal representative, heir, or other Person succeeding lawfully, and pursuant to the provisions of this Agreement, to the rights or obligations of either Party. (k) Termination - the termination of this Agreement, for any reason, prior to Expiration. 1.2. Other Definitions. - The following additional terms are defined in the following sections of this Agreement: (a) Base Rent §4.2 (b) Claim or Claims §10.1 (c) Concession Recitals, §F (d) Gross Sales §4.6 (e) Hazardous Materials §17 (f) Indemnified Parties §6.3 (g) Percentage Rent §4.3.1 (i) Project Recitals, §B (j) Premises Recitals, §B (k) Term §3 2. PREMISES City finds it to be in the public interest and consistent with park uses to grant an exclusive right to operate a Concession at the Corona del Mar State Beach. Therefore, pursuant to the terms and conditions set forth herein, City hereby grants to Concessionaire the exclusive right, privilege and concession to conduct a business at the Premises engaged in selling such items as those described in Section 5.1, Business Purposes. Concessionaire agrees to accept the Premises in an "as is" condition as tendered by City. Concessionaire agrees that no representations with respect to the condition or improvements of the Premises have been made by City except as specifically set forth in this Agreement. Brothers Huskey, LLC Concession Agreement Page 4 3. TERM Term of Agreement. The Term of this Agreement shall be month-to-month, commencing on the Effective Date and may be terminated by either Party for any reason by providing thirty (30) days' prior written notice to the other Party. 4. RENT 4.1. From May to September of each year, Concessionaire shall pay the greater of Base Rent or Percentage Rent. From October to April of each year, Concessionaire shall only pay Percentage Rent. 4.2. Base Rent. The Base Rent shall be established at Two Thousand One Hundred and 00/100 Dollars ($2,100.00) per month. Base Rent shall be paid, in advance, in equal monthly installments on the first day of each month. Base Rent for any partial month shall be prorated in accordance with the actual number of days in that month and shall be due on the first day of that month that falls within the Term. Annually, upon each successive anniversary date of the Effective Date, the Base Rent shall be increased three percent (3%). 4.3. Percentage Rent. 4.3.1. Payment. "Percentage Rent" shall be determined each calendar month and shall be calculated by multiplying six percent (6%) by the total Gross Sales (as defined in Section 4.6) made in, upon, or from the Premises and/or otherwise attributable to the Premises for the calendar month. For each month that Percentage Rent exceeds Base Rent, Concessionaire shall pay to City the Percentage Rent less the Base Rent paid to the City for that month, if applicable. 4.3.2. Accounting and Payment. Within twenty-five (25) days after the end of each calendar month for the term hereof, as may be extended as provided herein, commencing with the twenty-fifth (25th) day of the month following the Effective Date, and ending with the twenty-fifth (25th) day of the month next succeeding the last month of the term, as may be extended as provided herein, Concessionaire shall furnish to City a statement in writing, certified by Concessionaire to be correct, showing the total Gross Sales made in, upon, or from and/or otherwise attributable to the Premises during the preceding calendar month (or fractional month at the beginning of the term if the Effective Date is other than the first day of a month), and shall accompany each such statement with the Percentage Rent payment to City, less the Base Rent already paid to the City for that month, if applicable. 4.4. Revenue from Premises Use in Film, Television, and/or Advertising. Concessionaire may allow the Premises to be used for film, television production, advertising production, or other media vehicle only upon written approval from the City Brothers Huskey, LLC Concession Agreement Page 5 and in compliance with the Newport Beach Municipal Code. One-half (1/2) of all monetary revenue received by Concessionaire as compensation or other payment for the use of the Premises in a film, television production, advertising production, or other media vehicle shall be paid to City. The payment of revenue pursuant to this Section shall occur not less than thirty (30) days after Concessionaire receives this compensation or other payment. 4.5. Payment Location. Rent shall be payable at the office of the City's Revenue Division at 100 Civic Center Drive, Newport Beach, California, or at such other place or places as City may from time to time designate by written notice delivered to Concessionaire; or by electronic delivery if mutually agreed upon by City and Concessionaire at www.newportbeachca.gov. Concessionaire assumes all risk of loss and responsibility for late charges and delinquency rates if Rent is not timely received by the City regardless of the method of transmittal. 4.6. Gross Sales. 4.6.1. The term "Gross Sales" means: (1) all money, cash receipts, assets, property or other things of value, including but not limited to gross charges, sales, rentals, fees and commissions made or earned by Concessionaire and/or any assignees, licensees, permittees or concessionaires thereof, whether collected or accrued from any business, use or occupation, or any combination thereof, originating, transacted or performed in whole or in part, on the Premises, including but not limited to rentals, the rendering or supplying of services and the sale of goods, wares or merchandise, whether wholesale or retail, whether for cash or credit, or otherwise, and including the value of all consideration other than money received for any of the foregoing, without, except as expressly provided in Section 4.6(b), deduction from gross receipts for any overhead or cost or expense of operations, such as, but without limitation to salaries, wages, costs of goods, interest, debt amortization, credit, collection costs, discount from credit card operations, insurance and taxes. Each installment or credit sale shall be treated as a sale for the full price in the month during which such sale is made, irrespective of whether or when Concessionaire receives payment therefore. Gross Sales shall include any amount allowed upon any "trade in," the full retail price of any merchandise delivered or redeemed for trading stamps or coupons and all deposits not refunded to purchasers; (2) Orders taken in or from the Premises, even if the orders are filled elsewhere, and sales by any subconcessionaire in or from the Premises; (3) Gross receipts of all coin-operated devices that are placed on the Premises by Concessionaire or pursuant to any rent concession, percentage or other arrangement (but excluding revenue from telephones that are collected by a public and/or private utility); and Brothers Huskey, LLC Concession Agreement Page 6 (4) Rentals of any beach equipment, beach furniture, goods, wares or merchandise. 4.6.2. Exclusions from Gross Sales. Gross Sales shall not include, or if included there shall be deducted (but only to the extent they have been included), the following: (1) Sales and use taxes, so-called luxury taxes, consumers' excise taxes, gross receipts taxes, and other similar taxes now or in the future imposed on the sale of merchandise or services, but only if such taxes are added to the selling price and collected from customers; (2) The amount of returns to shippers or manufacturers; (3) The amount of any cash or credit refund made upon any sale where the merchandise sold or some portion is returned by the purchaser. Each sale upon installment or credit shall be treated as a sale for the full price in the month during which such sale shall be made, irrespective of the time when Concessionaire shall receive payment (whether in full or partial) from its customers; (4) Sales of trade fixtures or personal property to be replaced by Concessionaire that are not considered stock in trade; (5) Sums and credits received in the settlement of claims for loss of or damage to merchandise; (6) Meals provided for officers or employees without charge; (7) Meals, goods or products provided for promotional or publicity purposes without charge; (8) Cash refunds made to customers in the ordinary course of business; (9) Value added taxes ("VAT") or other taxes added to the selling price of products and other similar taxes now or hereafter imposed upon the sale of merchandise or services, whether such taxes are added to, or included in the selling price; (10) Discounted sales to employees of Concessionaire, not to exceed two percent (2%) of the monthly Gross Sales; (11) Uncollectible credit accounts and other bad debts, not to exceed two percent (2%) of the monthly Gross Sales; and (12) Amounts paid to charge card or credit card issuers. Brothers Huskey, LLC Concession Agreement Page 7 4.6.3. Annual Statements of Gross Sales. Within thirty (30) days after the end of each calendar year during the Term hereof or within thirty (30) days of Termination of this Agreement, Concessionaire shall furnish to City a statement in writing, certified by Concessionaire and a Certified Public Accountant to be correct, showing the total Gross Sales made in, upon, or from and/or otherwise attributable to the Premises during the preceding calendar year (or fractional year at the beginning of the term if the Effective Date is other than the first day of the year). 4.6.4. Sales and Charges. All sales and charges shall be recorded by means of cash registers that display the amount of the transaction certifying the amount recorded. The register shall be equipped with devices that log in daily sales totals, and 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. 4.6.5. Production of Statement, Records and Audit. Concessionaire shall keep at the Premises (and shall require any permitted subconcessionaire to keep at the Premises) full, complete and proper books, records and accounts of its daily Gross Sales, both for cash and on credit, at any time operated in the Premises. Concessionaire agrees to make available for inspection by City at the Premises, a complete and accurate set of books and records of all sales of goods, wares, and merchandise and revenue derived from the conduct of business or activity in, at or from the Premises from which Gross Sales can be determined. Concessionaire shall also make available, upon City request, all supporting records. Concessionaire shall also furnish City copies of its quarterly California sales and use tax returns at the time each is filed with the State of California. Concessionaire shall retain and preserve for at least three (3) years all records, books, bankbooks or duplicate deposit books and other evidence of Gross Sales. City shall have the right, upon reasonable notice, during the Term and within one hundred eighty (180) days after Expiration or Termination of this Agreement to inspect and audit Concessionaire's books and records and to make transcripts to verify the Rent due to the City. The audit may be conducted at any reasonable time during normal business hours. Concessionaire shall cooperate with City in making the inspection and conducting the audit. The audit shall be limited to the determination of Gross Sales and shall be conducted during usual business hours in a manner that minimizes any interference with the conduct of Concessionaire's regular business operations. If the audit concludes that there is a deficiency in the payment of any Rent, the deficiency shall become due and payable within twenty (20) days and if there is an overpayment, City shall refund the amount of the overpayment within twenty (20) days. City shall bear its costs of the audit unless the audit shows that Concessionaire understated Gross Sales by more than two percent (2%), in which case Concessionaire shall pay all City's reasonable costs of the audit. City shall not disclose financial information received in confidence and pursuant to this Agreement except to carry out the purposes of this Agreement unless disclosure is required (rather than permitted) by law. However, City may disclose the results of any audit in connection with any financing arrangements, the sale or transfer of City's interest in the Premises, pursuant to order of a court or administrative tribunal, or to collect any outstanding Rent. Brothers Huskey, LLC Concession Agreement Page 8 4.6.6. Concessionaire's Gross Sales Audit. In the event of any audit by City in accordance with this Agreement, Concessionaire may contest the results of City's audit by performing a confirming audit, at Concessionaire's expense, within sixty (60) days of receipt of City's audit results and supporting evidence, using an independent Certified Public Accountant reasonably acceptable to City. 4.6.7. Acceptance. The acceptance by City of any money paid to City by Concessionaire as Percentage Rent for the Premises, as shown by any statement furnished by Concessionaire, shall not be construed as an admission of the accuracy of said statement, or of the sufficiency of the amount of the Percentage Rent payment. 4.7. Late Payment. Concessionaire hereby acknowledges that the late payment of Rent or other sums due hereunder will cause City to incur costs not contemplated by this Agreement, the exact amount of which is extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges. Accordingly, any payment of any sum to be paid by Concessionaire not paid within five (5) days of its due date shall be subject to a ten percent (10%) late charge. City and Concessionaire agree that this late charge represents a reasonable estimate of such costs and expenses and is fair compensation to City for its loss suffered by such late payment by Concessionaire. 4.8. Interest on Unpaid Sums. Unpaid sums due to either City or Concessionaire under this Agreement shall bear interest at the rate of ten percent (10%) per annum on the unpaid balance, including but not limited to late payment penalties, from the date due until paid. 5. BUSINESS PURPOSES AND USE OF PREMISES 5.1. Business Purposes. The Premises are to be used by Concessionaire for the operation of a concession selling food, non-alcoholic beverages, and miscellaneous beach -related merchandise, as well as for the rental of beach -related products, including but not limited to, umbrellas, and beach chairs. Concessionaire's proposed menu is hereby attached as Exhibit "B." Pricing for these products will be comparable to prices at nearby beach concession facilities. Alcoholic beverage sales or giveaways are prohibited. 5.2. Operation of Premises. Concessionaire shall operate and manage the Premises in a manner comparable to other high quality businesses providing similar food and services. Deliveries shall be made and completed only between 7 a.m. and 6 p.m. on non -holiday weekdays. 5.3. Prohibited Uses. Concessionaire shall not sell or permit to be kept, used, displayed or sold in or about the Premises (a) pornographic or sexually explicit books, magazines, literature, films or other printed material, sexual paraphernalia, or other material which would be considered lewd, obscene or licentious, (b) any article which may be prohibited by standard forms of fire insurance policies, or (c) any alcoholic Brothers Huskey, LLC Concession Agreement Page 9 beverages. Vending machines, gaming machines or video or arcade games shall not be used or installed on the Premises unless expressly permitted by this Agreement. Concessionaire shall not use or permit the use of the Premises in any manner that (a) creates a nuisance or (b) violates any Law. Concessionaire shall not offer entertainment or broadcast music or entertainment through exterior speakers or other form of transmission without the written approval of City. In this event, Concessionaire shall obtain all required City permits and approvals. 5.4. Food Packaging and Debris. Concessionaire shall use food packaging consistent with good environmental practices, including prohibiting polystyrene (also known as Styrofoam) from the Premises, minimizing the use of PVC plastics (especially plastic bags for carrying food), and providing both trash receptacles and places for customers to dispose of recyclable products. 5.5. Outdoor Dining. Concessionaire shall be permitted to use up to eighteen (18) tables on a portion of the paved area outside of the Premises, in accordance with City zoning codes and State requirements. The layout of the tables is subject to approval by the City. Concessionaire may not expand onto the beach area, or place any temporary furniture or objects onto the beach area. 5.6. Operation. Weather permitting, Concessionaire shall keep the Premises in operation and open to the public for business in accordance with the following schedule: 5.6.1. From Memorial Day through Labor Day - open daily, hours from at least 9:00 a.m. to 6:00 p.m., but in no event, no earlier than 6:00 a.m. and no later than 10:00 P.M. 5.6.2. From the day after Labor Day to the day before Memorial Day open Tuesday — Sunday, from at least 11:00 a.m. to 4:00 p.m., but in no event, no earlier than 6:00 a.m., and no later than 10:00 p.m. 5.6.3. Concessionaire may close the Concession during periods of remodeling, reconstruction, inventory and emergencies (including substantially inclement weather) or to comply with Laws. 5.7. Food Preparation. Concessionaire shall install, at Concessionaire's own expense, fire protective systems in grill, deep fry, and cooking areas which are required by City, County, and state fire ordinances. Concessionaire shall also install adequate ventilation systems to operate the cooking area. 5.8. Advertising Display. Concessionaire may, at its own expense, place unlit signs in or upon the Premises subject to the prior written consent of the City as to the size, type, number, design and method of installation and in compliance with the City's sign code regulations. All signage placed by Concessionaire on, in or about the Premises shall remain the property of Concessionaire and shall be removed by Concessionaire upon Termination or Expiration of this Agreement at Concessionaire's Brothers Huskey, LLC Concession Agreement Page 10 expense; and any damage caused by removal shall be repaired at Concessionaire's expense. 5.9. Personnel. Concessionaire shall be responsible for hiring the necessary personnel to conduct the daily operation of Concession. Concessionaire shall comply with all federal, state, and local Laws related to minimum wage, social security, nondiscrimination, ADA, unemployment compensation, and workers' compensation. If required by the City, employees shall wear a uniform and/or identification badge. 5.10. Independent Contractor. It is understood that Concessionaire is an independent contractor and not an agent or employee of City. Nothing in this Agreement shall be deemed to constitute approval for Concessionaire or any of Concessionaire's employees or agents, to be the agents or employees of City. City shall have no interest in the business of Concessionaire. 5.11. No Distress Sales. No auction, fire, bankruptcy, "going out of business" or other distress sales of any nature may be conducted on the Premises without the prior written consent of the City Manager, which approval will not be unreasonably withheld but may be conditioned. 5.12. Parking for Employees. City shall provide Concessionaire with four (4) Annual Parking Permits each year for its employees. Annual Parking Permits shall be terminated concurrently with Termination of this Agreement, and returned to City. 6. TAXES LICENSES AND OTHER OBLIGATIONS 6.1. Payment of Taxes. Concessionaire shall pay directly to the appropriate taxing authorities all taxes applicable to this Agreement, fixtures and Concessionaire's personal property on the Premises, that are levied or assessed against Concessionaire during the Term. Taxes shall be paid at least ten (10) days before delinquency and before any fine, interest or penalty is due or imposed by operation of law. Concessionaire shall, upon request, promptly furnish to the City satisfactory evidence of payment. Concessionaire acknowledges that this Agreement may create a possessory interest subject to property taxation and that Concessionaire may be subject to the payment of property taxes levied on such interest. Concessionaire shall pay, before delinquency all taxes, assessments, license fees and other charges ("Taxes") that are levied or assessed against Concessionaire's interest in the Premises or any personal property installed on the Premises. 6.2. Payment of Obligations. Concessionaire shall promptly pay, when due, any and all bills, debts, liabilities and obligations incurred by Concessionaire in connection with Concessionaire's occupation and use of the Premises. 6.3. Challenge to Taxes. Concessionaire shall have the right in good faith, at its sole cost and expense, to contest the amount or legality of any Taxes on or attributable to this Agreement, the Premises, Concessionaire's personal property, or Brothers Huskey, LLC Concession Agreement Page 11 Concessionaire's occupation and use of the Premises, including the right to apply for reduction. If Concessionaire seeks a reduction or contests such taxes, Concessionaire's failure to pay the taxes shall not constitute a default as long as Concessionaire complies with the provisions of this Section. City shall not be required to join in any proceeding or contest brought by Concessionaire unless the provisions of any Law require that the proceeding or contest be brought by or in the name of City or any owner of the Premises. In that case, City shall join in the proceeding or contest or permit it to be brought in City's name as long as City is not required to bear any cost. If requested by Concessionaire, City shall execute any instrument or document necessary or advisable in connection with the proceeding or contest. Concessionaire, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered, together with all related costs, charges, interest and penalties. Concessionaire shall indemnify, defend and hold harmless the City, its City Council, appointed or elected officers, boards, commissions, employees, Authorized City Representatives, agents and volunteers ("Indemnified Parties") from and against any liability, claim, demand, penalty, cost or expense arising out of or in connection with any contest by Concessionaire pursuant to this Section. 7. UTILITIES. Concessionaire shall make all arrangements for utilities installation and pay for all utilities furnished to or used on the Premises, including, without limitation, gas, electricity, water, telephone service, and cable TV. Concessionaire may use City's trash enclosures or public trash cans, provided however, that City may, at City's discretion, require Concessionaire to arrange for its own refuse collection. Any repair to utility lines within the Premises is the sole responsibility of Concessionaire. Concessionaire shall service and maintain the Concession's 1500 -gallon grease interceptor. Refuse collection and grease interceptor maintenance shall occur between 7:00 a.m. and 6:00 p.m. on non -holiday weekdays. 8. ALTERATIONS TO THE PREMISES. 8.1. Concessionaire Improvements. Concessionaire acknowledges that City has delivered the Premises without any improvements, and it shall be Concessionaire's responsibility to install any improvements as necessary for the Concession to operate. All Concessionaire improvement plans and construction shall be subject to the prior written approval of the City. Concessionaire improvements shall be performed between 7:00 a.m. and 6:00 p.m. on non -holiday weekdays. Any contractors hired by Concessionaire shall be fully licensed and bonded. Concessionaire's contractors and any subcontractors shall obtain insurance in an amount and form to be approved by City's Risk Manager, including workers compensation insurance as required by law, general liability, automobile liability and builder's risk insurance covering improvements to be constructed, all pursuant to standard industry custom and practice. City shall be named as an additional insured on the contractors and any subcontractors policies. Brothers Huskey, LLC Concession Agreement Page 12 8.2. Permits. Concessionaire shall obtain, and be responsible for the costs for, all building permits, health department permits and other required permits prior to commencement of Concessionaire improvements and operations. 8.3. Quality of Work Performed. All alterations, maintenance and other work shall be performed in a good and workmanlike manner, shall comply with the plans and specifications submitted to City, and shall comply with all applicable governmental permit requirements and Laws in force at the time permits are issued. 8.4. Payment of Costs. Concessionaire shall pay all costs related to the construction of the improvements and any Alterations by Concessionaire or its agents. 8.5. Liens. Concessionaire shall keep the Premises free from any liens arising out of any work performed, material furnished, or obligation incurred by Concessionaire or alleged to have been incurred by Concessionaire. 8.6. Disposition of Alterations at Expiration or Agreement Termination. Any Alterations made to the Premises shall remain on, and be surrendered with, the Premises on Expiration or Termination of this Agreement (excluding Concessionaire's fixtures, equipment, furniture, and moveable decorations). However, City may elect not less than thirty (30) days prior to Expiration or Termination of this Agreement, to require Concessionaire to remove any Alterations that Concessionaire has made to the Premises. If City requires removal of Alterations, Concessionaire shall, at its cost, remove the Alterations and restore the Premises to a broom -clean condition before the last day of the Term, or within thirty (30) days after notice is given, whichever is later. Prior to Expiration or within fifteen (15) days after Termination of this Agreement, Concessionaire may remove any moveable partitions, machinery, equipment, furniture, and trade fixtures previously installed by Concessionaire, provided that Concessionaire repairs any damage to the Premises caused by removal. 9. MAINTENANCE OF PREMISES 9.1. Maintenance and Repair by Concessionaire and City. Concessionaire agrees that it will keep the Premises in Good Condition. Graffiti shall be called in to the City's Graffiti Hotline for removal. City may perform Maintenance or repairs in the event Concessionaire fails to commence required Maintenance or repairs within three (3) business days after receipt of notice to do so. The cost of any Maintenance or repairs by the City pursuant to this Section shall be payable as additional Rent. All furnishings, equipment, facilities, improvements, alterations, attachments and appurtenances not provided by City, but required for concession operations, including all kitchen equipment and interior furnishings, shall be maintained in Good Condition and repair by Concessionaire at its cost. City may perform required cleaning and charge the costs to Concessionaire if the Concessionaire fails to perform within five (5) days after notice to do so and continue to maintain the area as required by this Agreement. Brothers Huskey, LLC Concession Agreement Page 13 9.2. Entry by City. Upon twenty-four (24) hour notice to Concessionaire, City and its Authorized City Representatives may enter upon and inspect the Premises at any reasonable time for any lawful purpose. In case of emergency, City or its Authorized City Representative may enter the Premises by whatever force necessary if Concessionaire is not present to open and permit an entry. Any entry to the Premises by City shall not be construed as a forcible or unlawful entry into, or a detainer of, the Premises, or an eviction of Concessionaire from the Premises or any portion thereof. 10. INDEMNITY AND EXCULPATION; INSURANCE 10.1. Hold -Harmless Clause. Concessionaire agrees to indemnify, defend and hold harmless the City, its City Council, Boards, Commissions, officers, agents, volunteers, employees, and the State of California (collectively, the "Indemnified Parties") from and against any and all claims (including, without limitation, claims for bodily injury, death or damage to property), demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses (including, without limitation, attorney's fees, disbursements and court costs) of every kind and nature whatsoever (individually, a "Claim"; collectively, "Claims"), which may arise from or in any manner relate (directly or indirectly) to Concessionaire's possession, occupation or use of the Premises, specifically including, without limitation, any claim, liability, loss, or Damage arising by reason of: (1) The death or injury of any Person or damage to personal property caused or allegedly caused by the condition of the Premises or an act or omission of Concessionaire or an agent, contractor, subcontractor, supplier, employee, servant, sublessee or concessionaire of Concessionaire; (2) Any work performed on the Premises or materials furnished to the Premises at the request of Concessionaire or any agent or employee of Concessionaire, with the exception of Maintenance performed by City; and/or (3) Concessionaire's failure to perform any provision of this Agreement or to comply with any requirement of Law or any requirement imposed on the Premises by any duly authorized governmental agency or political subdivision. Concessionaire's obligations pursuant to this Subsection shall not extend to any Claim proximately caused by the sole negligence, willful misconduct, or unlawful or fraudulent conduct on the part of the Indemnified Parties. This indemnity shall apply to all claims and liability regardless of whether any insurance policies are applicable. 10.2 Exculpation of City. Except as otherwise expressly provided in this Agreement, City shall not be liable to Concessionaire for any damage to Concessionaire or Concessionaire's property from any cause other than the sole negligence, intentional or willful acts of the Indemnified Parties. Except as otherwise expressly provided in this Agreement, Concessionaire waives all claims against the Indemnified Parties arising for any reason other than the sole negligence, intentional or willful acts of the Indemnified Brothers Huskey, LLC Concession Agreement Page 14 Parties. City shall not be liable to Concessionaire for any damage to the Premises, Concessionaire's property, Concessionaire's goodwill, or Concessionaire's business income, caused in whole or in part by acts of nature including, without limitation, waves, wind and ocean currents. 10.3 Insurance. In addition to insurance required of Concessionaire to be obtained, provided, and maintained during the construction of the improvements, and without limiting Concessionaire's indemnification of City, Concessionaire shall obtain, provide and maintain at its own expense during the term of this Agreement, a policy or policies of liability insurance of the type and amounts described below and in a form satisfactory to City. 10.3.1 Certificates of Insurance. Concessionaire shall provide certificates of insurance with original endorsements to City as evidence of the insurance coverage required herein. Insurance certificates must be approved by City's Risk Manager prior to execution of this Agreement by the City. Current certification of insurance shall be kept on file with City at all times during the term of this Agreement. 10.3.2 Signature. A person authorized by the insurer to bind coverage on its behalf shall sign certification of all required policies. 10.3.3 Acceptable Insurers. All insurance policies shall be issued by an insurance company currently authorized by the Insurance Commissioner to transact business of insurance in the State of California, with an assigned policyholders' Rating of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the latest edition of Best's Key Rating Guide, unless otherwise approved by the City's Risk Manager. 10.3.4 Coverage Requirements. 10.3.4.1 Workers' Compensation Coverage. Concessionaire shall maintain Workers' Compensation Insurance at statutory limits and Employer's Liability Insurance at One Million and 00/100 Dollars ($1,000,000.00) for his or her employees in accordance with the laws of the State of California. Any notice of cancellation or non -renewal of all Workers' Compensation policies must be received by City at least thirty (30) calendar days (ten (10) calendar days written notice of non- payment of premium) prior to such change. The insurer shall agree to waive all rights of subrogation against City, its officers, agents, employees and volunteers for all losses that relate in any way to this Agreement. 10.3.4.2 General Liability Coverage. Concessionaire shall maintain commercial general liability insurance in an amount not less than Two Million and 00/100 Dollars ($2,000,000.00) per occurrence for bodily injury, personal injury, and property damage, including without limitation, contractual liability. If commercial general liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to the work to be performed under this Brothers Huskey, LLC Concession Agreement IPage 15 Agreement, or the general aggregate limit shall be at least twice the required occurrence limit. 10.3.4.3 Automobile Liability Coverage. Concessionaire shall maintain automobile insurance covering bodily injury and property damage for all activities of the Concessionaire arising out of or in connection with the services to be performed under this Agreement, including coverage for any owned, hired, non -owned or rented vehicles, in an amount not less than Two Million Dollars and 00/100 Dollars ($2,000,000.00) combined single limit for each occurrence. 10.3.4.4 Fire and Extended Coverage. Concessionaire shall maintain fire and extended coverage insurance, together with insurance against vandalism, theft and malicious mischief, on the improvements and fixtures, alterations, trade fixtures, signs, equipment, personal property and inventory on or upon the Premises from loss or damage to the extent of their full replacement value. 10.3.4.5 Concessionaire shall maintain loss of rent insurance insuring that the Rent will be paid to City for a period up to six (6) months if the Premises are destroyed or rendered unusable or inaccessible for commercial purposes by a risk insured under a special form property coverage policy including vandalism and malicious mischief endorsements. 10.3.5 Endorsements. Each insurance policy shall be endorsed with the following specific language: 10.3.5.1 The City, its elected or appointed officers, officials, employees, agents and volunteers, and the State of California, its elected or appointed officers, officials, employees, agents and volunteers, are to be covered as additional insureds, with respect to liability arising out of work performed by or on behalf of the Concessionaire. 10.3.5.2 This policy shall be considered primary insurance as respects to City, its elected or appointed officers, officials, employees, agents and volunteers as respects to all claims, losses, or liability arising directly or indirectly from the Concessionaire's operations or services provided to City. Any insurance maintained by City, including any self-insured retention City may have, shall be considered excess insurance only and not contributory with the insurance provided hereunder. 10.3.5.3 This insurance shall act for each insured and additional insured as though a separate policy had been written for each, except with respect to the limits of liability of the insuring company. 10.3.5.4 The insurer waives all rights of subrogation against City, its elected or appointed officers, officials, employees, agents and volunteers. Brothers Huskey, LLC Concession Agreement Page 16 10.3.5.5 Any failure to comply with reporting provisions of the policies shall not affect coverage provided to City, its elected or appointed officers, officials, employees, agents or volunteers. 10.3.5.6 The insurance provided by this policy shall not be suspended, voided, canceled, or reduced in coverage or in limits, by either party except after thirty (30) calendar days (ten (10) calendar days written notice of non-payment of premium) written notice has been received by City. 10.3.6 Timely Notice of Claims. Concessionaire shall give City prompt and timely notice of claim made or suit instituted arising out of or resulting from Concessionaire's performance under this Agreement. 10.3.7 Additional Insurance. Concessionaire shall also procure and maintain, at its own cost and expense, any additional kinds of insurance, which in its own judgment may be necessary for its proper protection and prosecution of the work. 11. DAMAGE OR DESTRUCTION OF PROJECT/PREMISES 11.1. Destruction of Premises. If the Premises are totally or partially destroyed, rendering the Premises or any portion thereof totally or partially inaccessible or unusable, Concessionaire shall restore the Premises to substantially the same condition as immediately prior to such destruction (including all trade fixtures, personal property, improvements and Alterations as are installed by Concessionaire, which shall be replaced by Concessionaire at its expense). Concessionaire may elect to terminate this Agreement by giving notice of such election to City within sixty (60) days after the date of the occurrence of any casualty if the cost of the restoration exceeds the amount of any available insurance proceeds, if the damage has been caused by an uninsured casualty or event, or if Concessionaire reasonably estimates that repairs of the Premises will take more than six (6) months. Upon such termination, insurance proceeds applicable to reconstruction of the Project (excluding Concessionaire's personal property therein) shall be paid to City and Concessionaire shall have no further liability or obligations under this Agreement. 11.2. Replacement of Concessionaire's Property. In the event of damage or destruction of improvements located on the Premises not giving rise to Concessionaire's option to terminate this Agreement, Concessionaire shall, at its own expense, replace and repair all Concessionaire's trade fixtures, equipment, machinery, furnishings, furniture and inventory as soon as reasonably possible to permit the prompt continuation of Concessionaire's business at the Premises. 11.3. Destruction of Project. In the event that all or a portion of the Project is damaged, and the Premises or a material portion becomes inaccessible or commercially unusable, and the damage or destruction cannot reasonably be repaired within twelve (12) months after the date of the casualty, City shall have the right to either: Brothers Huskey, LLC Concession Agreement Page 17 (a) Terminate this Agreement by giving to Concessionaire written notice (which notice shall be given, if at all, within thirty (30) days following the date of the casualty), in which case this Agreement shall be terminated thirty (30) days following the date of the casualty; or (b) Give Concessionaire written notice of City's intention to repair such damage as soon as reasonably possible at City's expense, in which event this Agreement shall continue in full force and effect; however, Rent shall be abated in accordance with the procedures set forth in Section 12. Concessionaire may terminate this Agreement by giving City written notice at any time prior to the commencement of repairs if City agrees to repair the Project pursuant to this Section and fails to commence repairs within one hundred twenty (120) days after giving Concessionaire written notice of its intention to repair. In such event, this Agreement shall terminate as of the date of notice from Concessionaire to City, and City shall have no liability under this Agreement. 12. ABATEMENT OF RENT 12.1. General Rule. In the event of damage or destruction of the Premises or Damage to the Project that impacts the Premises and this Agreement is not terminated, Concessionaire shall continue to utilize the Premises for the operation of its business to the extent it may be practicable and commercially reasonable. Rent shall abate only in proportion to the area of the Premises that is rendered unusable. The abatement of Rent shall commence on the date that use of the Premises is impacted and continue until the completion of those repairs necessary to restore full use of the Premises and Concessionaire's re -opening of the Premises. Concessionaire's obligation to pay Taxes pursuant to this Agreement shall not be abated or reduced. Rent shall not abate if the damage or destruction to the Premises is the result of the negligence or willful conduct of Concessionaire or its employees, officers or agents. Concessionaire's right to abatement of Rent is contingent on payment of insurance proceeds, if any, equal to the amount of Rent pursuant to coverage required by Section 10.3. 12.2. Abatement/Maintenance. Concessionaire shall not be entitled to any abatement of Rent for Maintenance that occurs during the Maintenance period. 13. PROHIBITION AGAINST VOLUNTARY ASSIGNMENT, SUBLETTING AND ENCUMBERING 13.1. Prohibition of Assignment. City and Concessionaire acknowledge that City is entering into this Agreement in reliance upon the experience and abilities of Concessionaire. Consequently, Concessionaire shall not voluntarily assign or encumber its interest in this Agreement or in the Premises, or assign substantially all or any part of the Premises, or allow any other person or entity (except Concessionaire's authorized representatives) to occupy or use all or any part of the Premises without the prior written consent of City, which shall not be unreasonably withheld. City's consent to any Brothers Huskey, LLC Concession Agreement Page 18 assignment or other transfer is subject to Concessionaire providing City with evidence reasonably satisfactory to City that the proposed transferee has financial strength and restaurant or food service experience comparable to Concessionaire and the use of the Premises by the proposed transferee is consistent with the terms of this Agreement. Except as otherwise expressly provided herein, any dissolution, merger, consolidation, reorganization of Concessionaire, or the sale or other transfer resulting in a transfer of a controlling percentage of the capital stock of Concessionaire, shall be deemed a voluntary assignment; provided, however, that the sale or transfer of a controlling percentage of the capital stock of Concessionaire pursuant to a public offering(s) of equity or debt instruments issued by Concessionaire, or other transfers of publicly traded capital stock or debt instruments shall not constitute a voluntary assignment and shall not require City's consent or approval. The phrase "controlling percentage" means the ownership of, or the right to vote, stock possession of at least fifty percent (50%) of the total combined voting power of all classes of Concessionaire's capital stock issued, outstanding, and entitled to vote for the election of directors, except for ownership of publicly traded shares, warrants or similar equity interests in Concessionaire traded on a national exchange or over-the-counter markets. 13.2. Exceptions. Notwithstanding the foregoing paragraphs or anything to the contrary contained herein, City's consent shall not be required for an assignment or subletting to an Affiliate, Subsidiary, or Successor of Concessionaire. For purposes hereof, an "Affiliate", a "Subsidiary", and a "Successor" of Concessionaire are defined as follows: (1) an "Affiliate" is any corporation or other entity which directly or indirectly controls or is controlled or is under common control with Concessionaire (for purposes of this Section, "control" shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such corporation or other entity, whether through the ownership of voting securities or by contract or otherwise); (2) a "Subsidiary" shall mean any corporation or other entity not less than twenty-five percent (25%) of whose outstanding stock shall, at the time, be owned directly or indirectly by Concessionaire and which is at least as creditworthy as Concessionaire; and (3) a "Successor" shall mean a corporation or other entity in which or with which Concessionaire is merged or consolidated, in accordance with applicable statutory provisions for merger or consolidation of corporations or a corporation or other entity acquiring a substantial portion of the property and assets of Concessionaire. Brothers Huskey, LLC Concession Agreement Page 19 13.3 Continuing Effect. City's consent to any assignment or encumbrance shall not relieve Concessionaire from its obligations or liabilities under this Agreement nor act as a waiver of the requirement that such consent be obtained to any subsequent assignment or encumbrance. 14. DEFAULT 14.1. Default by Concessionaire. The occurrence of any one or more of the following events shall constitute a default and material breach of this Agreement by Concessionaire: (a) The vacating or abandonment of the Premises by Concessionaire; (b) The failure by Concessionaire to make any payment of Rent or any other payment required by this Agreement, as and when due, when such failure shall continue for a period of ten (10) days after written notice of default from City to Concessionaire; (c) Except as specified in Subsection 14.1(b), the failure of Concessionaire to observe or perform any of the material covenants, conditions or provisions of this Agreement to be observed or performed by Concessionaire where such failure shall continue for a period of ten (10) days after written notice thereof from City to Concessionaire; provided, however, that if the nature of Concessionaire's default is such that more than ten (10) days are reasonably required for its cure, then Concessionaire shall not be deemed to be in default if Concessionaire commences such cure within said ten (10) day period and thereafter diligently prosecutes such cure to completion; (d) The making by Concessionaire of any general arrangement or assignment for the benefit of creditors; (e) Concessionaire becomes a "debtor" as defined in 11 U.S.C. Section 101 or any successor statute thereto (unless, in the case of a petition filed against Concessionaire, the same is dismissed within ten (10) days); (f) The appointment of a trustee or receiver to take possession of substantially all of Concessionaire's assets located at the Premises or of Concessionaire's interest in this Agreement, where such appointment is not discharged within ten (10) days; and (g) The attachment, execution or the judicial seizure of substantially all of Concessionaire's assets located at the Premises or of Concessionaire's interest in this Agreement, where such seizure is not discharged within sixty (60) days. Brothers Huskey, LLC Concession Agreement Page 20 14.2 Remedies. 14.2.1 Cumulative Nature of Remedies. If any default by Concessionaire shall continue without cure as required by this Agreement, City shall have the remedies described in this Section in addition to all other rights and remedies provided by law or equity, to which City may resort cumulatively or in the alternative. 14.2.1.1 Reentry without Termination. City may reenter the Premises, and, without terminating this Agreement, re -let all or a portion of the Premises. City may execute any agreements made under this provision in City's name and shall be entitled to all rents from the use, operation, or occupancy of the Premises. Concessionaire shall nevertheless pay to City on the dates specified in this Agreement the equivalent of all sums required of Concessionaire under this Agreement, plus City's expenses in conjunction with re -letting, less the proceeds of any re -letting or atonement. No act by or on behalf of City under this provision shall constitute a Termination of this Agreement unless City gives Concessionaire specific written notice of Termination. 14.2.1.2 City may terminate this Agreement by giving Concessionaire notice of Termination. In the event City terminates this Agreement, City may recover possession of the Premises (which Concessionaire shall surrender and vacate upon demand) and remove all Persons and property. City shall be entitled to recover the following as damages; (1) The value of any unpaid Rent or other charges that are unpaid at the time of Termination; (2) The value of the Rent and other charges that would have accrued after Termination less the amount of Rent and charges the City received or could have received through the exercise of reasonable diligence as of the date of the award; (3) Any other amount necessary to reasonably compensate City for the detriment proximately caused by Concessionaire's failure to perform its obligations under this Agreement; and (4) At City's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time -to -time by applicable California law. City shall be entitled to interest at the rate of ten percent (10%) per annum on all Rent and other charges from the date due or the date they would have accrued. City shall also be entitled to an award of the costs and expenses incurred by City in maintaining or preserving the Premises after default, preparing the Premises for re -letting, or repairing any damage caused by the act or omission of Concessionaire. 14.2.1.3. Use of Concessionaire's Personal Property. City may use Concessionaire's personal property and trade fixtures located on the Premises or any of such property and fixtures without compensation or liability to Concessionaire for Brothers Huskey, LLC Concession Agreement Page 21 use or damage. In the alternative City may store the property and fixtures at the cost of Concessionaire. City shall not operate the Concession in any manner tending to indicate that the Concession is affiliated with, part of or operated in conjunction with Concessionaire's business. 14.2.2. City's Right to Cure Concessionaire's Default. Upon continuance of any material default beyond applicable notice and cure periods, City may, but is not obligated to, cure the default at Concessionaire's cost. If City pays any money or performs any act required of, but not paid or performed by, Concessionaire after notice, the payment and/or the reasonable cost of performance shall be due as additional Rent not later than five (5) days after service of a written demand accompanied by supporting documentation. No such payment or act shall constitute a waiver of default or of any remedy for default or render City liable for any loss or damage resulting from performance. 15. SUBJECT TO STATE OPERATING AGREEMENT The Premises are located on property that is the subject of an Operating Agreement between the State of California and the City. Concessionaire shall not take any action that would cause the City to be in violation of any provisions of that Operating Agreement. If the State of California terminates the Operating Agreement, this Agreement shall terminate as a result and the parties shall be released from all liabilities and obligations under this Agreement. 16. WASTE OR NUISANCE Concessionaire shall not commit or permit the commission of any waste on the Premises. Concessionaire shall not maintain, commit, or permit any nuisance as defined in Section 3479 of the California Civil Code on the Premises. Concessionaire shall not use or permit the use of the Premises for any unlawful purpose. 17. NO CONFLICTS OF USE, HAZARDOUS MATERIALS. City represents and warrants that, to the best of City's knowledge, (i) Concessionaire's use of the Premises does not conflict with applicable Laws, and City knows of no reason why Concessionaire would be unable to obtain all required permits, licenses and approvals from the appropriate governmental authorities; (ii) the Project is not in violation of any environmental laws, rules or regulations and Concessionaire's contemplated uses will not cause any such violation; and (iii) the Project is free of any and all Hazardous Materials as of the date of this Agreement. In the event that the presence of any Hazardous Materials not caused by Concessionaire is detected at the Project at any time during the Term of this Agreement all remedial work shall be performed by City at City's expense. Concessionaire's obligation to open shall be delayed until the remedial work is completed if the remedial work is performed prior to Concessionaire opening for business. Concessionaire's obligation to pay Rent shall be abated in direct proportion to the extent Concessionaire is unable to conduct its Brothers Huskey, LLC Concession Agreement Page 22 business upon the Premises as a result of any remedial work that is performed subsequent to Concessionaire opening for business. Concessionaire shall have the right (but not the obligation) to terminate this Agreement, upon thirty (30) days advance written notice to City in the event that Hazardous Materials are detected at the Project and the presence or the remediation materially affects Concessionaire's ability to conduct its business in the Premises. "Hazardous Materials" shall mean any oil, flammable explosives, asbestos, urea formaldehyde, radioactive materials or waste, or other hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, any "hazardous substances", "hazardous wastes", "hazardous materials" or "toxic substances" under applicable federal, state and local laws, ordinances and regulations. 18. CITY'S DEFAULTS/CONCESSIONAIRE'S REMEDIES. City shall be in default if it fails to perform, or commence performance if the obligation requires more than ten (10) days to complete, any material obligation within ten (10) days after receipt of written notice by Concessionaire to City specifying the nature of such default. City shall also be in default if it commences performance within ten (10) days but fails to diligently complete performance. In the event of City's default, Concessionaire may: (a) Upon five (5) days' notice to City, cure any such default, and City shall reimburse Concessionaire the amount of all costs and expenses incurred by Concessionaire in curing the default, together with interest and expenses at the maximum rate then allowed by law; or (b) Terminate this Agreement if City's default materially interferes with Concessionaire's use of the Premises for its intended purpose and City fails to cure such default within ten (10) days after a second demand by Concessionaire in which case Concessionaire shall have no further or continuing obligations. 19. EVENT OF BANKRUPTCY 19.1. If this Agreement is assigned to any person or entity pursuant to the provisions of the Bankruptcy Code, 11 U.S.C. Section 101 et seq. or any similar or successor statute ("Bankruptcy Code"), any and all monies or other consideration payable or otherwise to be delivered in connection with such assignment shall be paid or delivered to City, shall be and remain the exclusive property of City and shall not constitute property of Concessionaire or of the estate of Concessionaire within the meaning of the Bankruptcy Code. Any and all monies or other consideration constituting City's property under this Section not paid or delivered to City shall be held in trust for the benefit of City and be promptly paid or delivered to City. 19.2. Any person or entity to which this Agreement is assigned pursuant to the provisions of the Bankruptcy Code shall be deemed without further act or deed to have assumed all of the obligations arising under this Agreement on and after the date of Brothers Huskey, LLC Concession Agreement Page 23 such assignment, including the obligation to operate the business which Concessionaire is required to operate under this Agreement. 20. NOTICES. Any notice, demand, request, consent, approval or communication that either party desires or is required to give shall be in writing and shall be deemed given three (3) days after deposit into the United States registered mail, postage prepaid, by registered or certified mail, return receipt requested. Unless notice of a different address has been given in accordance with this Section, all notices shall be addressed as follows: If to City, to: CITY OF NEWPORT BEACH Attn: Real Property Administrator 100 Civic Center Drive P.O. Box 1768 Newport Beach, CA 92658 (949) 644-3236 If to Concessionaire, to: Brian Huskey c/o Tackle Box 3029 E. Shore Avenue Corona Del Mar, CA 92625 (213) 435-7579 chefbrianhuskeya-gmail.com 21. SURRENDER OF PREMISES At the Expiration or earlier Termination of this Agreement, Concessionaire shall surrender to City the possession of the Premises. Concessionaire shall leave the surrendered Premises, required personal property and fixtures, in good and broom - clean condition, reasonable wear and tear excepted. All property that Concessionaire is not required to surrender, but that Concessionaire does abandon shall, at City's election, become City's property at Expiration or Termination. 22. COMPLIANCE WITH ALL LAWS Concessionaire shall at its own cost and expense comply with all statutes, ordinances, regulations and requirements of all governmental entities, including federal, state, county or municipal, whether now in force or hereinafter enacted. In addition, all work prepared by Concessionaire shall conform to applicable City, county, state and federal laws, rules, regulations and permit requirements and be subject to approval of the City Manager or his/her designee. Brothers Huskey, LLC Concession Agreement Page 24 23. WAIVERS The waiver by either party of any breach or violation of any term, covenant or condition of this Agreement, or of any ordinance, law or regulation, shall not be deemed to be a waiver of any other term, covenant, condition, ordinance, law or regulation, or of any subsequent breach or violation of the same or other term, covenant, condition, ordinance, law or regulation. The subsequent acceptance by either party of any fee, performance, or other consideration which may become due or owing under this Agreement, shall not be deemed to be a waiver of any preceding breach or violation by the other party of any term, condition, covenant of this Agreement or any applicable law, ordinance or regulation. 24. SEVERABILITY If any term or portion of this Agreement is held to be invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions of this Agreement shall continue in full force and effect. 25. APPLICABLE LAW This Agreement shall be construed in accordance with the laws of the State of California in effect at the time of the execution of this Agreement. Any action brought relating to this Agreement shall be adjudicated in a court of competent jurisdiction in the County of Orange. 26. ENTIRE AGREEMENT; AMENDMENTS 26.1. The terms and conditions of this Agreement, all exhibits attached, and all documents expressly incorporated by reference, represent the entire agreement of the parties with respect to the subject matter of this Agreement. 26.2. This Agreement shall supersede any and all prior agreements, oral or written, regarding the subject matter between Concessionaire and City. 26.3. No other agreement, promise or statement, written or oral, relating to the subject matter of this Agreement, shall be valid or binding, except by way of a written amendment to this Agreement. 26.4. The terms and conditions of this Agreement shall not be altered or modified except by a written amendment to this Agreement signed by Concessionaire and City. 26.5. If any conflicts arise between the terms and conditions of this Agreement, and the terms and conditions of the attached exhibits or the documents expressly incorporated by reference, the terms and conditions of this Agreement shall control. Brothers Huskey, LLC Concession Agreement Page 25 26.6. Any obligation of the parties relating to monies owed, as well as those provisions relating to limitations on liability and actions, shall survive termination or expiration of this Agreement. 26.7. Each party has relied on its own inspection of the Premises and examination of this Agreement, the counsel of its own advisors, and the warranties, representations, and covenants in this Agreement. The failure or refusal of either party to inspect the Premises, to read this Agreement or other documents, or to obtain legal or other advice relevant to this transaction constitutes a waiver of any objection, contention, or claim that might have been based on such reading, inspection, or advice. 27. TIME IS OF THE ESSENCE Time is of the essence for this Agreement. 28. SUCCESSORS Subject to the provisions of this Agreement on assignment and subletting, each and all of the covenants and conditions of this Agreement shall be binding on and shall inure to the benefit of the heirs, successors, executors, administrators, assigns, and personal representatives of the respective parties. 29. INTERPRETATION The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. 30. TABLE OF CONTENTS; HEADINGS The table of contents of this Agreement and the captions of the various sections of this Agreement are for convenience and ease of reference only and do not define, limit, augment, or describe the scope, content, or intent of this Agreement. 31. GENDER; NUMBER The neuter gender includes the feminine and masculine, the masculine includes the feminine and neuter, and the feminine includes the neuter, and each includes corporation, partnership, or other legal entity whenever the context requires. The singular number includes the plural whenever the context so requires. Brothers Huskey, LLC Concession Agreement Page 26 32. EXHIBITS All exhibits to which reference is made in this Agreement are incorporated by reference. Any reference to "this Agreement" includes matters incorporated by reference. 33. CITY BUSINESS LICENSE Concessionaire shall obtain and maintain during the duration of this Agreement, a City business license as required by the Newport Beach Municipal Code. 34. COSTS AND ATTORNEYS FEES The prevailing party in any action brought to enforce the terms and conditions of this Agreement, or arising out of the performance of this Agreement, shall not be entitled to recover its attorneys' fees. 35. NONDISCRIMINATION Concessionaire, for itself and its successors, agrees that in the performance under this Agreement, Concessionaire shall not discriminate against any person because of the marital status or ancestry of that person or any characteristic listed or defined in Section 11135 of the Government Code. [SIGNATURES ON NEXT PAGE] Brothers Huskey, LLC Concession Agreement Page 27 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. ATTEST: IR�1' City Clerk APPROVED AS TO FORM: (4r Aaron arp C4M n.lal.11U City Attorney CITY OF NEWPORT BEACH ("City"), a California municipal corporation and charter city By: Ct. Davei City Manager ' 6 BROTHERS HUSKEY, LLC ("Concessionaire"), a California limited liability company By: Brian Huskey Managing Member Brothers Huskey, LLC Concession Agreement Page 28 EXHIBIT A PREMISES Brothers Huskey, LLC Concession Agreement Page A-1 Exhibit A-1 k?. � l •) Iil , w t ,C Ae V ON • oP�� T .. �, P��� o�� 6gysin v.�_ � .: ��� � ` '�"� - t� �,,�t$ �" �i' j.2' >" \ 9 •fir a' 3` y y�t}'y'\ V, ^' `, `; f . • r P .`C� , �'C: `kyr A. r .EAe d t t f P� • .� :'`��°�`� � �^ ��?\ r �"A PJB r: \ OfOna Del Mar State, •� / 'r` r.. Beach r, y JWUM 4 # _- Inspirations �� ,, rpt \or 4f, Newpor i Beach GIS HURT 0 417 833 'eP Feet Disclaimer: Every reasonable effort has been made to assure the accuracy of the data provided, however, The City of Newport Beach and its employees and agents disclaim any and all responsibility from or relating to any results obtained in its use. Imagery: 2009-2013 photos provided by Eagle Imaging www.eagleaerial.com 11/18/20151 Exhibit A-2 loo LOA ��" 1 ry _ Loo) e iit r �� .71 Ily 7 •nu,Uel �� +� ' _ % •'�"� Mar State Beach R 71 l F t Newpori Beach Disclaimer: Every reasonable effort has been made to assure the accuracy of the data provided, however, The City of GIS Newport Beach and its employees and agents disclaim any and all responsibility from or relating to c"\VPO any results obtained in its use. 0 200 400 Imagery: 2009-2013 photos provided by Eagle Feet Imaging www.eagleaerial.com • P Exhibit A-3 fi I I : : vi %Ikl t is Brothers Huskey, LLC Concession Agreement Page B-1 local grub shack SUNRISE B' fast sandwich. Bacon. Scrambled egg. Cheddar B' fast burrito. Bacon. Scrambled egg. Hash brown. Cheddar. House salsa Avocado tartine. Smoked salmon. Hard-boiled egg. Herbs Chilaquiles. Tomatillo sauce. Black beans. Fried egg French toast. Almond butter. Banana. Chocolate. Maple syrup Fresh Squeezed Orange Juice GRUB + SNACKS New England inspired clam chowder. Crackers Chowder chicharron. Pork rinds smothered in clam chowder + bacon Baby kale salad. Smoked almonds. Raisins. Croutons. Tofu garlic dressing Poke. Salmon. Avocado. Crispy rice. Citrus dressing Quesadilla. Roasted poblano. Caramelized onion. Three cheeses Buffalo cauliflower. Blue cheese. Celery Elote. Street corn. Spicy crema. Cotija cheese Tackle Box burger. Angus House Blend. Caramelized onions. Cheddar. Garlic aioli. Spicy ketchup ROLLS Chicken Club. Applewood Smoke Bacon. Tomato + Lettuce. Lemon Garlic sauce Fried Catfish. Cornmeal. Tomato + Lettuce. Remoulade Shrimp. Grilled. Romaine. Charred green onion aioli Maine Lobster. Romaine. Old bay aioli. Squid ink roll Niman Ranch Pork belly "bahn mi". Ginger + scallion. Pickled carrots. Spicy aioli Cali cheesesteak. Fried peppers. Crispy onions. White American Falafel. Chickpea + edamame. Chipotle tzatziki THE TACKLE BOX The Team's Daily Special Brothers Huskey, LLC Concession Agreement Page B-2 SIDES House Fries. Seasoned salt House chips. Seasoned salt Assortment of Pickles Seasonal vegetables. Prepared correctly DRINKS Agua fresca. Changes frequently Jones Soda Hot + Cold Brew Coffee Water Brothers Huskey, LLC Concession Agreement Page B-3 EXHIBIT C RECORDING REQUESTED AND WHEN RECORDED RETURN TO: Office of the City Clerk City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 [Exempt from Recordation Fee - Govt. Code Sec. 6103] MEMORANDUM OF AGREEMENT FOR OPERATION OF CONCESSION AREA This Memorandum of Agreement for Operation of Concession Area ("Memorandum") is dated QC�0h-r aq,.1OiSand is made between City of Newport Beach, a California municipal corporation and charter city ("City") and Brothers Huskey, LLC, a California limited liability company ("Concessionaire"), concerning the Premises described in Exhibit "A" attached hereto and by this reference made a part hereof. For good and adequate consideration, City leases the Premises to Concessionaire and Concessionaire hires them from City, for the term and on the provisions contained in the Concession Agreement ("Agreement") dated 0 obeir M, A 0 IS, including without limitation provisions prohibiting assignment, subleasing, and encumbering said leasehold without the express written consent of City in each instance, all as more specifically set forth in said Agreement, which said Agreement is incorporated in this Memorandum by this reference. The term is month-to-month, commencing on the Effective Date unless terminated sooner, as defined in the Agreement. This Memorandum is not a complete summary of the Agreement. Provisions in this Memorandum shall not be used in interpreting the Agreement's provisions. In the event of conflict between this Memorandum and other parts of the Agreement, the other parts shall control. Execution hereof constitutes execution of the Agreement itself. [SIGNATURES ON NEXT PAGE] Brothers Huskey, LLC Concession Agreement Page C-1 IN WITNESS WHEREOF, the Parties hereto have executed this Memorandum as of the date first written above. CITY OF NEWPORT BEACH ("City"), a California municipal corporation and charter city D,9ve.ff City Manager ATTEST: Leilani I. Brown City Clerk APPROVED AS TO FORM: OFFICE OFT F CITY ATTORNEY r Aaron C. Harp City Attorney BROTHERS HUSKEY, LLC, ("Concessionaire"), a California limited liability company By: —2;—= Brian Huskey Managing Member RNiP* Brothers Huskey, LLC Concession Agreement Page C-2 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of 0a AN (DE- )ss. On TERAajA)P-`1 2.4 , 20_L�4 before me;)eMNIC-r--0-V2)NN VAQLe,',- , Notary Public, personally appeared R�� A `yEL � U SV- r-� who proved to me on the basis of satisfactory evidence to be the person(s)-whose name(s) is/arm subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/hertl:NMr authorized capacity(ies), and that by his/her -/their signatures(s) on the instrument the person(s), or the entity upon behalf of which the persons) acted, executed the instrument. certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. JENNIFER ANN MULVEY WITN -S my hand and official seal. Commission # 2045022 g �� Notary Public z Z - California z "''�' Orange County y Signature My Comm. Expires Oct 12, 2017+ sea ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of CC(2�A��-\ Cc E }ss. On U-'1vay:�C-kA P-, , 20 1 �r before me, pe O6\�N 0, AUi ; J , Notary Public, personally appeared C7f*v-- V k ( c proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. JENNIFER ANN MULVEY commission # 2045022 WITNESS m hand a d official seal. a -:w Notary Public - California i Z °�" Orange County M Comm, Ex ices Oct 12, 2017 Signature (seal) Brothers Huskey, LLC Concession Agreement Page C-3