HomeMy WebLinkAboutC-1856 - Concession agreement with option Corona del Mar & Newport Beach (see also C-1920)(?air&
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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,
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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:
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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"
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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
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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,
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EXHIBIT "B"
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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.
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(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
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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.
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.;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.
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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.
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(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
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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
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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
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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
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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
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„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
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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.
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(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-
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• 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