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HomeMy WebLinkAboutC-1856 - Concession agreement with option Corona del Mar & Newport Beach (see also C-1920)(?air& S-9 c C -( �, OPTION FOR CONCESSION AGREEMENT THIS OPTION AGREEMENT, made and enured into this day of 1976, by and between the CITY OF NEWPORT BEACH, a chartered municipal corporation, hereinafter referred to as "City° and KILMER ENTERPRISES, INC., hereinafter refer=d to as. "Qgti.onee *. W I T N E t S E T H: WHEREAS, on March 10, 1970, the City of Newport Beach entered into a Concession Agreement for the operation of two concession stands at the Corona del Mar State and City Beach Park with Gordon Kilmer, predecessor in interest to Kilmer Enterprises, Inc.; and 1979; and WHEREAS, said agreement will terminate on December 31, WHEREAS, Optionee has submitted a proposal for an option to renew said Concession Agreement for an additional period of ten (10) years commencing on January 1, 1980, and ending on December 31, 1989, unless sooner terminated as provided; and WHEREAS, the City Council has reviewed.said proposal and finds it to be fair and equitable and in the best interest of the City of Newport Beach. NOW, THEREFORE, the parties hereto agree as follows: 1. City hereby grants an option to extend the Concession Agreement between the City of Newport Beach and Gordon Kilmer, predecessor in interest to Kilmer Enterprises, - 0 0 Inc., dated March 10, 1970, which will expire on December 31, 1979, for an additional ten (10) year period commencing on January 1, 1980, and ending on December 31, 1989, unless sooner terminated as provided. 2. In consideration of said ten (10) year option, Optionee hereby agrees to be bound by and will perform under the terms and conditions as set forth in the proposal of Kilmer Enterprises, Inc. dated May 5, 1976, which is attached hereto marked Exhibit "A" and made a part herein by this reference. Said performance of said terms and conditions to be completed by Optionee during the 1976 -1977 fiscal year to the satisfaction of the City Manager. 3. This option shall be exercisable by notice in writing by Optionee to the City Clerk of City on or before October 1, 1979. 4. Upon exercise of this option, Optionee agrees to be bound by all of the terms and conditions of the original Concession Agreement dated March 10, 1970, which are not incon- sistent with Exhibit "A" of this Option Agreement and subject . to requiring additional public liability and property damage insurance consistent with any changes in City's liability insurance policies which may be adopted during the period between January 1, 1980 through December 31, 1989. Said Concession Agreement Dated March 10, 1970, is attached hereto marked Exhibit "B" and made a part herein by this reference. 5. Should City exercise its right to purchase pursuant to Paragraph 14 of the Concession Agreement, City shall pay Optionee a percentage of concessionaire's investment, defined as having a value of at least Forty -Two Thousand Dollars ($42,000.00), based on the following schedule: -2- Termination Date Percentage Before February 1, 1981 100% February 1, 1981 to January 31, 1982 908 February 1, 1982 to January 31, 1983 80% February 1, 1983 to January 31, 1984 708 February 1, 1984 to January 31, 1985 60% February 1, 1985 to January 31, 1986 50% February 1, 1986 to January 31, 1987 30% February 1, 1987 to January 31, 1988 20% February 1, 1988 to January 31, 1989 100 After January 31, 1989 0% 6. Upon execution of the Option Agreement, Optionee will pay City One Thousand Dollars ($1,000.00). T. This Optic= o Agreement. is subject to termination by. City for failure to comply with any of the terms and condi- tions of Exhibit "A" or for failure of Optionee to comply with any terms and conditions of this Option Agreement. S. This Option Agreement must be submitted.to the Department of Parks and Recreation Resources Agency of the State of California for approval and is not effective until such approval. IN WITNESS WHEREOF, the parties have executed this Option Agreement as of the date first above written. ATTEST: Cit�k APPROVED AS TO FORM: City Attorney APPROVED BY THE STATE RESOURCES AGENCY, DEPARTMENT OF PARKS AND RECREATION 1z Dated: , 1S'76 3- CITY OF NEWPORT BEACH By Mayor KILMER ENTERPRISES, INC. ByAd4--' k � Gordon Kilmer President • KILMEP ENTERPRISES, INC Corona del %1 ,r Stare Beach Box 772 Coro:ia. d-t Niar, Calif. 92625 (7 14) 673-3174 EXHIBIT "A" -V MaY 5, 1976 : X-4 14A Nr. Bob Long A Tq)' 4'0 'M Ir Administrative Assistant 3300 Newport Blvd. Newport Beach, California 92660 Dear Bob: In recent conversations with Bernard Syfan of Syfan Construction and..Pat Dunigan of the City -E'nzineering staff, it is my understand- in-, that extensive reinforcement work is planned in Public Service. Area Number One at the Corona del Mar State-City Beach Park. Estimates for this work ran3s up to thirty thousand dollars. This includes rfforcement of the columns with horizontal supports and complete roo'Lin.- of the Te--3. I am pleased that this structa—z-al problem is about to be solved. I have observed la--.-,e chun,_s of cement brealk away from the columns and have been concerned about their stability.. This is Kilmer Enterprises seventh year of a ten year contract to operate the concessions at the Corona del Mar State-City Beach Park. In the interest of sel-urin- additional years of oneration and to be of greater service to the City of Newport Beach, Kilmer vnternr_iscs would lilke to i,,ia".-3 the following. proposal for your consideration. En co.11siderat-ion for an option of ten additional years,' Kilmer E'n:ero-is offers to: 1. Advance 90,000 for ':cork on -the Tees and Columns. 2. c, the concession bil!LcL.; _n (Curren s i'b I I i +y '?I r) C i ty �Ilrl biiildin�� (-!-z-terior:.-,. jr�t �Iff L S­ vi cz­_� n I z 11. EXHIBIT "A" f C . Insol new counters and alumi* window assemblies in the original concession building. Exterior work to be accomplished with.the best acrylic paints, stainless steel counters, annodized aluminum window ? assemblies with plate glass. COST = $3,000, plus $500 yearly to maintain. 3. Un -_grade INTERIORS of the concession buildings a. Repaint all concession building interiors. Colors to be selected by.a professional decorator and will be approved by the City.. b. Make small structural changes to maximize appearance - and increase operating efficiency. COST = $3,000 f, :a 4. Up -grade FOOD SERVICE EQUIPhIEN!' (Seventeen years old) a. Install two high volume Scottsman Ice Machines b. Install two infrared hih efficiency food warmers c. Install one high capacity Carbonic International Drink Dispenser d. install one micro -wave oven e. Rebuild the walk -in- refrigerator f. Rebuild other eauipment to insure continued good service COST = 85,000 .Bob, this proposal represents an investment of $42,000. In.addition Kilmer Enterprises will take over responsibility for the maintenance of the exteriors of the concession building and benches at an estimated cost of $500 yearly. „ Thank you for your consideration and please call on me for any more information that may assist you in your study of this proposal.. S i n 6,4!kl y, + Gddrdrdon Kilmer, P esident Kilmer Enterprises, Inc. 9 CONCESSION AG2EE1,ENT 0 CORONA DEL IU& STATE AND CITY BEACH PARK THIS AGREENaNT, made and executed this IC Tf/ day of �.,� .� f/ 197D, by and between the CITY OF NEt7FORT BEACH, a municipal corporation, hereinafter referred to as "City," and GoRa70N ICIIVFH, hereinafter referred to as "Concessionaire "; RECITALS A. City owns certain real property southerly of Ocean Boulevard in Corona del liar and controls certain other real property under a lease from the State of California which together comprise the Corona del Mar State and City Beach Park; and. B. The City iiaster Plan for the Developuwmt of the Corona del Mar State and City Beach Park provides for two public service areas at which concession facilities are to be available, which are designated as Public- Service Areas No. l and No. 2. A concession building is in existence at Public Service Area No. 1 and a concession building will be constructed by the City at Public Service Area No. 2; and C. City has awarded a contract for the construction Of buildings and appurtenances on Public Service Area No. 2 in said park (not including, however, the completion of the inside o= said buildings and installation of fixtures as required in this contract), as said area is shown on a plot plan of said park dated Februa_n1 9 1970, -1- EXHIBIT "B" • 0 and atcached hereto and marked exhibit "A "; and D. City finds it to be in the public interest and consistent with park uses to grant an exclusive right to operate a concession business as herein provided in the build- ings on said Public Service Areas No. 1 and No. 2; and E. City invited proposals from prospective con- cessionaires and Concessionaire was awarded the exclusive right to operate said concession business on Public Service Areas No. 1 and No. 2 as a result thereof; NOId, TIFOBE, the parties agree: 1. Concession; (a) City hereby grants to Concessionaire the exclusive right, privilege and concession to conduct a business within the buildings on said Public Service Areas No. 1 and No. 2 in said park 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, firewood, and small items of fishing tackle such as lines, hooks and weights, and for the rental of various items of beach equipment such as back rests, umbrellas, and surf- riders,.and for the sale or rental of other items of similar nature usually sold or rented at a resort refreshment stand; the sale of which items shall be subject to tine prior written approval of the City Parks, Beaches and Recreation Director. Concessionaire shall not sell fishing gear such as poles, reels or gear containers. Concessionaire agrees to provide all necessary fixtures, goods, merchandise, labor and equipment required for the vending or renting or the above items or any other items permitted to be sold or rented. I 0 0 (b) City reserves the right to prohibit the use, display, sale or rental of any macinine, 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 fixed 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 to the public by Concessionaire. All food and beverage products sold shall be of uniform high quality. Failure to naintain quality deemed satisfactory by City shall be deemed a breach of this agreement. Unimpaired use of . Public Service Areas No. 1 and \o. 2 by the public is to be maintained throughout the term of the concession agreement. (c) Concessionaire shall be subject to all state and local laws, rules and regulations and shall pay all tares 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 equip- ment, the products sold, and the method of selling meet all current regulations, including health regulations. 2. Term: (a) The 'term of this agreement shall begin on the date of execution and shall end on December 31, 19793 both da_es inclusive, unless terminated prior thereto 5611 +:� 5 as provided herein. (b) During the term of this agreement, Concessionaire may remain open for business daily after 5:00 a.m. and before 10:00 p.m. and shall be open for business on Saturdays, Sundays and holidays between noon and 5:00 p.m. from October 1 to March 31 and every day from 10 :00 a.m. to 6:00 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. 3. Finishing Buildings and Furnishing Fixtures. (a) It is mutually understood that City by separate contract is having buildings aad.appurtenances constructed on said Public Service Area No. 2 in accordance with the plans and specifications therefor, a copy of which. was obtained and reviewed by Concessionaire prior to the time his proposal was submitted to City. It is further understood that City is not having the interior of said buildings, including plumbing, electrical and flooring, under its contract. Concessionaire agrees to complete the interior of the buildings 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 agrees to coordinate the wort: on the interior and on the cabinets, fixtures and equipment with the work of City's building contractor under the direction of the architect employed by the City to supervise the construction of the buildings and appurtenances on Public Service area No. 2. 0 0 .;on.cessionaire a;rees i_o do all the fJork of completing —iz 1n CeriOr o7 -Ile bllII -I gS in hllb11C Service Area Aio. 2 that is not required of the City's contractor undo= the plans acid specifications referred to above. Concessionaire shall pay all cost of doing the work hereunder other than the contract price being paid by City under separate contract. All work on the building by Concessionaire shall be done in accordance with plans and specifications therefor, approved by the City Council, a copy . of which is attached hereto and marked Exhibit "B" and made a part hereof, and pursuant to a building permit issued by City, and shall be subject to the approval of the Director of Building of City. On1, first class materials shall be used and all work must be performed and completed in a good and workmanlike manner. All cabinets and fixtures shall be of first class materials and of the highest quality obtainable. 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 wort: is done. Concessionaire may pay for the fixtures and equipment in full at the time they are acquired and installed, or may obtain therm by other lawful method. -5- • P' lotwiChstanding the manner in v;hicii the fixtures and equip- ment are acquired, and without limiting or restricting the duties and obligations of Concessionaire hereunder and without in any manner limiting or restricting the rights of City, Concessionaire agrees to execute a chattel mortgage at the request of City either before or at any time after the.time Concessionaire begins actual operation of the concession in the form approved by the City in which Concessionaire hypothecates all of his present and future right, title aad interest in.and to all of the fixtures and equipment installed or used in the concession operation during the term of the agreement (excluding equipment kept for rental purposes) in favor of City, to guarantee the performance of all obligations of Concessionaire under this agreement during the.entire term hereof, including the payments to City. At the end of the term of this agreement or any extension thereof, if all payments required herein have been completed and all obligations performed by Concessionaire, the obligation of the mortgage shall be deemed satisfied and the mortgage shall be discharged and of no further effect. Concessionaire may remove any fixtures or equipment installed in accordance with the require- ments hereof which in the judgment of Concessionaire are obsolete or worn out; provided, however, that any such fixtures or equipment so removed must be immediately replaced by Concessionaire with new fixtures or equipment of equal. quality which shall also be subject to the chattel mortgage provided for herein. '_6_ 0 • (c) Tiie ::: .: ro quirec: of Coacessi onair under this para.7raph 3, including the completion of the interior OL file b,:- 'Id i.n�S, file 1:0 L1neCt10n Of the (1t111t1e5, and the installation of the cabinets, fixtures and equipment, must be completed on or before July 1, 1470. This completion date shall be extended only by the amount of time Concession- aire is delayed by the failure of the City's building contractor to complete the buildings or by strikes or catastrophe beyond the control of Concessionaire. Concession- aire shall pay to City for each and every.day,.including Sundays and holidays, that he is in default in completing the work required hereunder the sum of Fifty Dollars ($50.00) as liquidated damages. It is mutually agreed that this is the amount of damages 'that City will surfer by reason of such default. (d) Concessionaire shall post a corporate surety bond with City conditioned upon Concessionaire completing all of the work on the interior of the buildings and the installation of cabinets, fixtures and equipment required herein and the payment of all claims of laborers, materialmen and others having lien rights under Title IV, Part III, of the Code of Civil Procedure. Said bond shall be in a sum of not less than Thirty Thousand and No /100 Dollars (,$30,000.00) and shall be subject to the approval of the City Attorney as to form. 4. Concessionaire to Operace Business. Concession- aire agrees to assume said righc, privilege, and concession hereby granted and to operaLe said concession within said buildings in Public Service Areas No. 1 and No. Z for the -7- 0 • plirpoS.^:; and in Cn'_ i:lanner and accoj: din° to the terms and con•:iit -ons herein S�at�G, reserving, 'C10Wet;eY, to City the right or ingress and egress to inspect said Public Service Areas No. 1 and No. 2 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. 5. Repairs. (a) Concessionaire agrees to con- tinuously maintain and keep in good repair at his own expense the concession buildings on Public Service Areas No. 1 and No. 2 and every part thereof except that which City herein - after agrees to maintain. Concessionaire's obligation includes but is not limited to interior partitions of the buildings, window frames, doors, interior painting, and repair and replacement of windows in the buildings. If exterior painting or repair to the structure, roof or exterior walls is required by any,act or omission of Concessionaire, City shall cause the painting- or repair to be done but Concessionaire shall pay for it. Concessionaire also agrees to maintain and keep in good repair all equipment and fixtures in said buildings. All such w ^rk shall be done to the satisfaction of City. If, after ten (10) days' written notice from City to do specific items of -19- s :'la lil C•'_i:a!lc:: 01 C: 2��.= a,: :i 'C i (i _A, C u nc::Jslonai'rc has Sailed 'LO CO So, laity 1.--ay Cio the chino'' O_ things Specified and bill Concessionaire for aha cost thereof. Concessionaire shall reimburse the City for Such cost within fifteen (15) days after receiving the bill. (b) City will do normal maintenance and normal repair on the structure of said buildings, including the maintenance and repair of the roofs, exterior walls, and exterior painting. City shall have sole discretion as to when such .repair, maintenance or painting is necessary. (c) Concessionaire shall not construct any additional buildings or make any structural changes, alterations or additions to any buildings in said area without the prior written consent of City. 6. Utilities. Newport Beach water and sewerage is available in the park at Public Service .Areas No. 1 and No. 2. Concessionaire shall be entitled to water service and sewerage service under the same terms as any other occupant of premises in the City and shall pay the same fees, rate or rates as any other occupant. Concessionaire shall make arrangements for other utility services at said area and shall promptly pay all charges for uti lities when due.. 7. Concessionaire to Keep Area Clean. (a) concessionaire shall keep the interior and exterior of the buildings and all of the area within Public Service Areas No. 1 and iIo. 2 and in every direction :within fifty (C'J) feet C!- said Public Service Areas No. 1 and No. 2 clan and sanita_y and 'free from rubbish, garbage and debris of every ici.nd. Concess'! o'nai rc_ Sil -al l furnish an adequate number -9 - i f o:C Crash Cdas, aPn rov�d by City as to type, color, condltloa and location, to servicz PILJlic Service Areas No. 1 and No. 2 and the 50 -too- area surrounding in such a manner that there shall always be adequate space to deposit rubbish, debris and garbage. The obligation of Concessionaire hereunder must be performed to the satisfaction of City. (b) City is currently providing garbage and refuse pickup service at said beach and at Public Service Area No. 1, but is not hereby obligated to continue said service. (c) Concessionaire need not provide beach cleaning in the park outside the areas he is hereby obligated to i:eep clean. 8. Payments to City. (a) From the beginning of -his agreement through December 31, 1979, Concessionaire shall pay to City a guaranteed minimum monthly payment of $2,500.00 for the months of June, July, August and September or . Thirty -two percent (32 %) of the monthly gross receipts from the sale of all salable items plus forty -two percent (42 %) of the monthly gross receipts for "these months from all rental items, whichever sum may be larger, plus the same percentages of gross receipts indicated above for any calendar month or portion thereof that said concession is operated prior or subsequent to June, July, August and September during each year of this part of the term of this agreement. Payment of zhe percentages of ;ross receipts shall be made to City monthly on or before th-- twentieth day of the month following th-e month of operation. In the event the sum of the percent - ag s of monthly gross receipts do-es not equal the guaranteed -10- 1.11.:.1 .i:luGl i,wn Limy ri: Clcal, in i.h('. i :io kitas durlug which the guaranteed minimum is required, than Concessionaire shall pay to City said minimum monthly payment on or before the twentieth day of the month following the month of operation; provided, however, that if Concessionaire is prevented from operating said concession during a part of June, July, August or Septem- ber, by any cause beyond his control, the required guaranteed minimum monthly payment shall be prorated in the. ratio which the actual operating period bears to the full month for which said guaranteed monthly minimum 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 Lhis 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, or from any other use of said area or any portion thereof, or from any other use of 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 Lazes imposed by any governmental entity and collected by Concessionaire or deposits made with Concessionaire to guarantee the return of rental equipment. (c) Concessionaire shall maintain and use cash registers for each and every sale or.rental at each place ,lhi re money is received for all sales of goods and rentals of equipment. All such cash -registers shall be equipped with -ii- 0 • „Oil�1n!1U Li3 r e c C:� :Ln iit tc,'.s �3I1' C!O ,� CO r•3�ord receij?zs 1rOM sales a:la reittalS. :�'_'.:i7 reg_;::ers sha.il Oe kepc locked and the to`_als Sho7.an :r >_reon shall not be re -set cscept in the presence of an autaorized representative of City. Copies of all tape shall be retained by Concessionaire during the term of this. agreement and for a period of two (2) years thereafter. If any dispute exists at the end of such two years concerning gross receipts, Concessionaire shall not destroy such tape or any part thereof without the written consent of City. Both the -registers and the tapes shall be subject to inspection and review by City upon request at any time during business hours. City shall -request inspection or review at such times as will not unnecessarily interfere with Concessionaire's business operation. (d) All payments shall be to the City at the office of the Director of Finance in the City Ra11. 9. Postin of Rates and Prices Advertising Sitins, Trades e. (a) Concessionaire shall post rates and prices in Public Service Areas No l and ado. 2 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. Upon written request having been made, all advertising matter shall thereafter be sub- mitted to City for approval prior to publication or circulation. (c) Concessionaire shall not place or allow any signs placards, or advertising matter to be placed or main tained on, or attached to, the buildings or elszwhere in said -12-- 0 i areas witheuc. the prior consent of City, and such I usiness signs Shall be placed, maintained and attached in such manner as City prescribes 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 with- out the same having been approved by City in writing. Con- cessionaire 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. 10. Beverage and Food Containers. (a) Concessionaire shall not sell drinks of any description in bottles, cans or breakable cups. All drinks shall be sold in paper, cardboard, or similar disposable type containers. All containers of food and beverage shall be subject to approval of City. Con- cessionaire shall immediately discontinue sale or use of any containers disapproved by City. (b) The consumption of alcoholic beverages in the park is prohibited. Concessionaire shall not seek a license to sell alcoholic beverages therein. 11. Written Approval of Assignment. Concessionaire shall not assign or sublet the rights or privileges granted under this concession agreement or any interest in this agreement without the prior written consent of City. Any manager of the concession or of any unit of the concession must be of high moral character and able to meet and deal with thc' public in an effective and inoffensive manner. E 12 . _.?.i1L o — ;ii_ '.:na Lion. 0 (a) Ia the eveni C onc°_ssloaai.r-_ is -1s to ma'.,.e L°ie payments to City at the 4 tme and iv the Cia!iner required ere -n or operates the concession in an unla.vfu1 manner or breaches or violates any other term or condition of this agreement, the City may at its option at any time, in addition to any other remedy it may have, terminate this agreement by giving notice in writing of such termination to Concessionaire specifying the effective date of termination and thereupon tare possession of the premises, including -all City property and the buildings and all fixtures and equipment therein, and remove any and all persons or property therefrom. Upon the date of termination fixed by City, Concessionaire shall give City possession of the build- ings and the fixtures and e -luipyent and turn the business over to City which shall thereafter operate the same or designate someone to do so, and all of Concessionaire's rights hereunder except to the paymant hereinafter provided, if any, shall terminate. Before termination by reason of default on the part of Concessionaire with respect to any covenant, matter, or thing on the part of Concessionaire to be kept, done, or performed hereunder (other than matting the payments required hereunder), City shall cause to be given to the Concessionaire a written notice specifying the particulars wherein Con- cessionaire is in default and demanding performance in accordance with the terns of this agreemen'c. If, within ten (10) days after sects notice is given, the Concessionaire shall have fully complied therewith, or in good faith shall have commenced the wo-rc or act necessary to comply therewith and ti7c Ile e:iOY tt, sisals a :L1 "!� :'(lt ly prOSecu su--' "Or'C Or act LO -i4_. 1 k: 1- Un, 120 _-il aaCaOil ll--clared iezeuadar, but, in ailur-- to comply rich su--h and effect a termination by specified. OL suca br,:Jach shall be t_:e -vent of Concessionaire's notice, the City may then declare reason of the default therein (b) In case City terminates this.agreement under the provisions of this paragraph 12, City may at its option, either at the time of termination or after the market value of the fixtures and equipment is fixed as herein.pro- vided, enforce its rights under any mortgage it may have on the fixtures and equipment or it may require Concessionaire to remove all fixcures and equipment used in the operation of the concession business or it may waive its rights under any such mortgage and pay Concessionaire eighty percent (00`/.) of . the mar'et value thereof for said fixtures and equipment as of the effective date of termination, reduced, however, by any amount owed to City by Concessionaire under the terms of this agreement and further reduced by any amount required to accomplish repair or maintenance which under this agreement is the obligation of Concessionaire and further reduced by the amount of any lien on the fixtures and equipment and by any amount owed by Concessionaire, the payment of which is secured by a hypothecation of such fixtures and equipment or i any part thereof. If required by.City, Concessionaire shall -res:ove all fixtures and equipment within thirty (00) days after being given notice to do so. Failure to remove all of thn same wicilin that time shall constitute abandonment or i .-hose -.reaiaini n- and the saute shall thereupon become the ! ! n- :p:_rty of tha City and City :ay use them or dispose cf -15- i • 0 0 tn_m and reta -a h2 procaeds. Uaon -removal of any fixtures or equipment Concessionaire shall not damage the buildings or any part thereof and shall repair and paint all walls and floors when removal occurs. Such work must be done in a good workmanlike manner and the buildings must be left in condition to permit a concession business to operate without. further repair or painting. Said market valua shall be determined by an appraisal board consisting of three (3) members appointed in the following manner: Within ten (10) days after the effective date of termination, City shall appoint one member of said board, giving notice of such appointment to Concessionaire in writing. Within ten (10) days after the service of such notice, Concessionaire shall appoint a second member of said board, giving notice of such appointment to City in writing. The two appraisers thus selected shall appoint a third appraiser within ten (10) days after the appointment of the second and the service of the notice of such appointment as required above. In the event of the failure to appoint any appraiser as set forth herein, either party may apply to the presiding judge of the Superior Court of the State of California in and for the County of Grange for the appointment such appraiser. The appraisal board shall fix the market value of the fixtures and equip- ment used in the operation of the concession business within hirty (30) days after the appointment of the third appraiser or as soon as is possible to render a fair decision. The decision of the majority of the appraisal board shall be the d- -cision of all. Upon paymen_- of the sum herein provided, if 0 0 ally, by City LO Concessionaire's title to all such fixtures and equipmenL shall be automatically trans - •_`erred to City. If Concessionaire has no ownership interest in the fixtures and equipment, he shall, nevertheless, at the request of City assign his right to possession and all other rights thereto to City upon the date of termination fixed by City. The tern "fixtures and equipment" as used here does not include equipment kept for rental purposes. Such equipment shall, upon termination, be removed in accordance with paragraph 15 hereof. 13. Cost of Improvements. Upon completion of the work of finishing the inside of the building or buildings and the installation of cabinets and fixtures and the connection of utilities as required herein, Concessionaire shall, within thirty (30) days, submit an itemized statement of the cost of such work to City. Such statement shall include only the actual contract price paid by Concessionaire for such work, or if it is not done under contract, the direct labor and material cost to Concessionaire for such work plus the actual cost of overhead to the extent the overhead does not exceed ten percent (10%) of the labor and material cost. Such cost including the overhead to the extent permitted shall be termed "Concession - ai-re's Investment" for the purpose of the provisions of paragraph 14 of this agreement. 14. City sight to Purchase. In addition to the right to terminate this agreement under paragraph 12, City has the option to terminate at any time upon giving not less than thirty (30) days' `J :":�t t °n notdce to Concessionaire. This r:L '•.lt t0 tC '!".:ina moo' is absolute and City need have no reason -17- i i 0 Uoo :l c- ilsed by ritzy In saiu wri'-t'_n no -4 Jncess- unaire shall give City Possession of the buildings and the fixtures and equipment and turn the concession business over to City which shall thereafter operate the same or designate someone to do so, and all of Concessionaire's rights hereunder, except the right to the payment hereinafter provided, if any, shall terminate. City shall within sixty (60) days after the date of termination pay to Concessionaire the market value of the equipment owned by Concessionaire and used in the operation of the business (excluding the equipment kept for rental purposes) fixed in the same manner as the market value of fixtures and equipment may be fixed upon termination under paragraph 12 plus the follo,,aing pe-rcentage of the "Concession- aire's Investment" according to the effective date of the termination, reduced, b.owever, by any amount owed to City by Concessionaire under the terms of this agreement and further reduced by any amount required to accomplish repair or main- tenance which under this agreement is the obligation of Concessionaire and further reduced by the amount of any lien on said fixtures or equipment and by any amount owed by Concessionaire, the payment of which is secured by a hypothe- cation of such fi -tures and equipment or any part thereof: Termination Date: Lefore April 1, 1971 April 1, 1971, to March 31, 1572 April 1, i972, _o ilac:;a 31, 1973 April 1, 19713, to March 31, 1974 April 1, 1917,, to Na rch 31, 1975 Alter Mar _-�i 31, 1975 Act =r :-i: r.c 31, 1L1179 ._lu_ Percentage: 100% `800 V 0 % 40% 20% 10 7. 0% U *)orl C i'r.- .�Sic1f: �f'_iv L'rtioon 2.n:i mile payslela OL su_ms hBre1:1 J.CO'ii i-•cd, )_i aCly, by l,l Cy CO L0n�85SlOnairfl, oncessionaire`s itle to all :;`c _fixtures anc, equipment shall be automatically transferred to City. if Concessionaire has no ownership interest in all or a portion of the fixtures or equipment, he shall, neverthe- less, assign his right to possession and all other rights thereto to City upon the date of termination fixed by City. 15. Removal of Property. Upon expiration or termination of this agreement, the Concessionaire shall wir-hin fifteen (15) days thereafter remove from said premises, or otherwise dispose of, in a manner satisfactory to City, all p;_rsonal property belonging to Concessionaire, including the equipment kept for renal purposes, located on said premises. Should Concessionairra fail to remove or dispose of his property within fifteen (15) nays as herein provided, City may at its election consider such property abandoned or may dispose of same at Concessionaire's expense. Upon expiration or termination hereof, except as specifically provided herein, Concessionaire shall leave the premises, buildings, fixtures and equipment except that kept for rental purposes in good condition and repair. Concessionaire shall not remove any futures or equipment used in the operation of the concession business, except that Concessionaire shall remove equipment ept for rental purpose =s and personal property wilicil includes vehicles, gro eries, supplies, persona' clothing, of Lice :; ll]p 11eS, OSL1C2 iu "Lni �lt_2, Cash re dsCers, and nothing e'LSe. Upon expiration o= tnis agreezecir 'Oncessi0nai re' s .1t1 t0 a "1 21 ?aU -e3 a a d L-Iu—;Pm.aat wai -,;:2 are nG:= SnJ_ji.:'_t Lo removal f I 1 I 0 0 ._ilccssionairc: shall vcsc in th? City and City shall have n:; obligation to pay Cc_ ,icessionaire for same. 15. Hold Harmless - Insurance. (a) Concessionaire a;rees to release, and to protect and save harmless, City and State and their officers, agents and employees from any and all claims, loss or liability on account of injury, loss, or damage to persons or property suffered or sustained in, on, or about the premises or elsewhere by any person whomso- ever in any manner directly or indirectly arising 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 Public Liability and Property Damage Insurance with minimum limits of Five Hundred Thousand and No /100 Dollars ($500,000.00), One •Zillion and No /100 Dollars ($1,000,000.00) Public Liability, with products liability, and at least Fifty Thousand and No /100 Dollars ($50,000.00) Property Damage Liability, naming the City and State and their officers, agents, and employees, as additional insured. Said policy or policies hall contain an endorsement providing that the insurance company shall not cancel such policy or policies without thirty (30) days ,7ritltcn notice to City and that City is not liable for the paymen'- of any premiums or assessments on Said 1:olicy or poli J-S. (c) Said policy or policies shall be in a form 'issued by the 1n5(lrin 9 7 E cone urrently. with the °2C3teSror any new or renewal policies erf2.z'ive durin3 the term of this agreement shell be submitted to City at least twenty (20) days prior to the effective date of such policy or policies. 17. Damage of Premises. In the event of destruc- tion, loss, or damage by fire or other cause of any of the buildings, improvements, or fixtures in said Public Service Areas No. 1 or No. 2 used by Concessionaire, the City shall not be obligated to replace such destroyed, lost, or damaged property, or be liable to said Concessionaire for any loss of use or damage by reason thereof. 13. Fire Insurance. 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 to the full insurable value thereof. In the event of destruction, loss or damage, all proceeds from such insurance shall.be deposited in a bank in the City of Newport Beach approved by City and used by Concessionaire only for the purpose of replacing, repairing and restoring the fixtures and equipment. Concesion- aire shall begin the work ;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, repair- ing and restoring such fixtures and equipment exceed the insurance proceeds, Concessionaire shall . pay the remainder of such cost. iotwit-hstanding the interruption of the business of Concessionaire Glnile the wr rk is being done, this agree - r'n+_ shai.L CU ^,i iTa1C 1L1 BL eCi:. it cha buildings are destroyed or substantially damaged and the City gives written notice to Concessionaire chat City does not intend to restore the buildings, or if one year has passed and the City has not .restored 'the build- ings, Concessionaire may elect to restore the buildings to the satisfaction of City and then restore, repair or replace the damaged fixtures and equipment and continue the con- cession business or may treat this contract at an end and withdraw any insurance proceeds from his insurance which were previously deposited as required herein. 19. Workmen's Compensation Insurance. Concession- aire shall maintain Workmen's Compensation Insurance for all his employees. 20. Insurance Policies Filed. Concessionaire shall place the policies of all insurance required by this agreement or duplicates thereof or certificates evidencing the same on file with City.. 21. Books of Account. Concessionaire agrees to keep books of account in connection with the operation of said concessions in a manner satisfactory to City, which books shall be open at all times to City for the purpose of inspection or audit. For each calendar year or portion thereof at the beginning or end of the agreement, unless a different reporting period has been approved by.City, Con - cessionaire shall submit within forty -five (45) days after the close of the reporting period such financial statements of his operations as may be requested by City. 22. notices. (a) All notices herein provided to given, or �7i ?1 c�7 m1y i7 1O'3Il, Dy CltCler party to the other, -22- • 9 1,'7h: iJc ?*_! Ltliiy SiVan When made in @Jrit1?'ig a,nd Qaootiited in tha UT14-'Led Sta",-cs :Rail at Newport. Beach, Califor-.ia, _crtified and postage prepaid, and addressed as I ollows: To the Concessionaire at: Mr. Gordon Kilmer 259 Cabrillo Costa Mesa, California and to the City at: City of :Newport Beach Attention City ,tanager City :tall 3300 Newport Boulevard Newport Beach, California 92660 (b) The address to which the notices shall or may be Nailed as aforesaid by cider 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. 23. Title to Real Property. Concessionaire hereby acknowledges the title of the State of California and the City of Newport Beach to the land ccmp.*4.sing Corona del :oar State: and City Beach Park and agrees never to assail or contest that title. Concessionaire is not being granted any right, title or interest in or to the land or any part thereof by this agreement. 24. Contractual Rights Only. The parties agree that Concessionaire is not a lessee or tenant of the premises or any part thareo_ and that tha only rights of Concessionaire are those provided in this agrreament. Should Concessionaire be deemed a lessae or tenant, Concessionaire hereby specifi- -23- L tally waives all rights under SccLion 1942 of the Civil Code of the State of California. 25. Ad-minis traLion of Contract. For the purposes of Lhe administration of this contract by the City, "City" shall mean the City Manager or an officer or employee of the City of,Newport Beach 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. A decision by the City Council is final. 26. Concessionaire to Pay Cost of Litigation. Concessionaire agrees to pay City all costs and expenses, including reasonable attorney's fees, incurred by City in any action brought by City to enforce the terms of this agreement. 27. 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. 28. Automatic Termination. Should any person other than Concessionaire secure possession of Public Service Areas No. 1 or No. 2 or of 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 laa whatsoever, and remain in possession or maintain any right or rights for a period of five (5). days, this agreement shall autocratically terminate without any a---Lion on part of City, and City may enter and take possession of the premises, build -ina.i and fi- xtures and. remove all _�4 _ • ! persons and property therefrom notwithstanding any other ,)rovisions of law or of this agreement. 29. State Approval. It is mutually understood that this agreement must be submitted to the Department of Parks and Recreation Resources Agency, of the State of California for approval and is not effective until such approval. 30. Telephone Booths. Space is provided on said Public Service Areas No. 1 and No. 2 for telephone booths. Concessionaire shall arrange to have coin - operated telephones installed as necessary to. serve the public. Concessionaire shall provide electricity to the booths and shall keep them clean. Any revenue to Concessionaire shall be included in his gross sales -receipts. 31. Parking Lot. Concessionaire understands and agrees that City is to operate the parking lot at the Park and may increase or decrease the size thereof in the sole discretion of City. City shall determine the times of operation of the lot and may close the same at any time it deems necessary or convenient. All revenue from the lot belongs to City. It is agreed that City will allocate and designate the location of parking spaces deemed necessary by City to serve Concessionaire and employees of Concession- aire without caaroe therefor. The number of spaces allocated iithout charge shall not e:�:cced ten (10). 32. ;business Us_ Only. The buildings used here- under by Concessionaire ar_ for business use only and neither _2 •,_ l.U!i�:i, ;i 1:1 =L11Y2 nciY a:TI Ci:`71G }'-�c a;;ent CL Conee s:;ioraire shall Y.i3iCl in su2h buildin —s or in Public Service Areas No. 1 or No. 2. 33. Promt Performance Required. Time is of the essence of this agreement. IN WITMySS I- MEREOF the parties have executed this agreement as of the riate first -'- - :APPROVED AS TO FOKI: City Att ney Concessionaire CWY OF MEXPORT v Mayor Attest, f zt- i. APPROVED by Department of Partcs and Beaches, Resources Agency, of the State of California, this day - of *' 1970. ByL � rt1 -� v THS: , I J3 August 12, 1976 MEMO TO THE FILE City Attorney office has executed agreement for transmittal to State for signature. s RESOLUTION NO. 8 864 Y aX' t�++ #i! ✓yy(���,,RESOLUTION OF THE CITY COUNCIL FOF THE CITY OF NEWPORT BEACH AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AN OPTION FOR CONCESSION AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND KILMER ENTERPRISES, INC. WHEREAS, there has been presented to the City Council of the City of Newport Beach a certain Option For Concession Agreement between the City of Newport Beach and Kilmer Enter- prises, Inc. in connection with the operation of two concession stands at the Corona del Mar State and City Beach Park; and WHEREAS, the City Council has reviewed the terms and conditions of said Option For Concession Agreement and finds them to be satisfactory and that it would be in the best interest of the City to authorize the Mayor and City Clerk to execute said agreement; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach that said agreement above described is approved, and the Mayor and City Clerk are hereby authorized and directed to execute the same on behalf of the City of Newport Beach. ADOPTED this 9th day of August , 1976. ATTEST: City Clerk ;c: Mayor DDO /bc 6/4/76