HomeMy WebLinkAbout07 SPTS PK CONCES XFER 10-16-00AGENDA RE?'-)RT
I
MEETING DATE: OCTOBER 16, 2000
NO. 07
10-16-00
TO:
WILLIAM A. HUSTON, CITY MANAGER
FROM:
PATRICK SANCHEZ, DIRECTOR, PARKS AND RECREATION SERVICES
SUBJECT:
TRANSFER AND ASSIGNMENT OF TUSTIN SPORTS PARK FOOD AND
BEVERAGE CONCESSION LEASE AGREEMENT
Ill
SUMMARY:
Mom's Sports Caf6 is requesting the Tustin Sports Park Food and Beverage Lease
Agreement be assigned to Luigi and Amy Ravetto of Caffe Piemonte.
RECOMMENDATION:
Approve the assignment of the lease transfer of the Tustin Sports Park Concession to
Luigi and Amy Ravetto, dba Express Sports Caf& waive the City's right to collect_a
transfer fee and approve the Assignment of Resolution.
FISCAL IMPACT:
No fiscal impact. The terms and conditions of the original lease remain in effect.
BACKGROUND:
Marcia Sanserino, dba Mom's Sports Cafb, originally entered into a lease agreement
with the City to operate the food and beverage concession at the Tustin Sports Park on
January 19, 1999. Marcia has submitted a written request to the City pursuant to the
assignment provision in the lease agreement to assign the lease to Luigi and Amy
Ravetto.
The assignment of the lease has been reviewed by our City Attorney and is subject to
the approval of our City Council. Luigi and Amy Ravetto are successful Tustin business
proprietors who own and operate Caffe Piemonte. Staff'is satisfied that Luigi and Amy-
Ravetto can satisfactorily operate the food and beverage concession at the Tustin
Sports Park.
The City Attorney has reviewed the assignment of the lease agreement ensuring
compliance with all applicable prerequisite terms and conditions. The City's Risk
Manager and Finance Director has reviewed the insurance provisions required by the
lease transfer and has approved the insurance designation.
Under the terms of the lease,, the City is entitled to receive a transfer fee equal to 'one
percent (1%) of the gross sales pdce. Since the amount due the City is insignificant and
less than $200, staff recommends the City waive its right to collect the transfer fee. The
City Council may complete the lease transfer by approving the attached Assignment of
Resolution.
Respectfully Submitted,
Patrick Sanchez
Director, Parks and Recreation
Attachments:
Resolution
Assignment of Lease Agreement
Lease Agreement
City Attomey Review
RESOLUTION NO. 00-68
l0
13.
12
13
3.4
15
3.6
18
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23.
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A RESOLUTION OF THE CITY COUNCIL OF THE CiTY OF TUSTIN,
CALIFORNIA, APPROVING THE ASSIGNMENT OF THE LEASE
AGREEMENT FOR THE FOOD AND BEVERAGE CONCESSION AT
THE TUSTIN SPORTS PARK.
WHEREAS, on January 19, 1999, the City of Tustin ("CitY") and Marcia
Sanserino ("Lessee") entered into a Lease Agreement to operate a Food and
Beverage Concession at the Tustin Sports Park (the "LeaSe"); and
WHEREAS, section 18.7 of the Lease prohibits assignment of the Lease
"without the prior consent of the City, which consent shall not be unreasonably
withheld;" and
WHEREAS, Luigi and Amy Ravetto, dba Express Sports Caf6, desires to
assume all of Marcia Sanserino's rights and obligations under the Lease;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of
Tustin, California, does hereby resolve, declare, determine and order as follows:
,
That Luigi and Amy Ravetto, dba Express Sports Caf6, are capable of'
performing under terms of the Lease as well as Marcia Sanserino.
o
That the Assignment of Lease Agreement, attached hereto as Exhibit
"A," is hereby approved and shall become effective upon the notarized
signature of a duly authorized corporate officer of Express Sports Cafb.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Tustin, held on the 16th day of October 2000.
Jeffery M. Thomas, Mayor
ATTEST:
25 Pamela Stoker, City Clerk.
TO:
CITY OF TIJSTIN .,
CERTIFI~AT5 OF INSURANCE AND DESIGNATION OF NAIV~_D ADDrTIONAL INSURED
NO MODIFICATIONS OR ADDITIONS MAY BE MADE .TO THiS FORM
CITY OF TUSTIN
P.O. Box 3539
Turn'in, CA g268%353g
II Express Sports Cafe ' 1
il 12850 Robinson Drive· I Company Letzer S:
5 ~Coml3any Letter D:
Jl 14 S State College Blvd #226 'CompanyLeflmrE:
[Anaheim, CA' 9 2 8 0 6 Company Letter F:
PROJECT: Luiqi & Amy Ravetto
,,
COMPANIES AFFORDING CO~GE
(MUST HA~ BE~S ~TING OF AT L~AST A, VII]
,,
Zurich InsUrance Group
This certifies that the pdlicies of ins~rance']i~'e"E l~lo~ ha-~e been issued to ~ i~s~d ~'~e above: are in force at ibis' ~'m~ ~h~! the City of
Tusfin is named as an additional insured thereon as respects claims arising.in connection with ~e Pm)eCt named above and that such insurance
shall be primary with respect to any other insurance in force procured by City. -
Policy Policy :
Type of Insurance Policy Number
GENERAL LIABILITY
[~{ Commercial W7141962
General Liability
[ ~ Occurrence Basis
[,~ Owner's & Contractors'
Protective
[ ~Bmad Form Prop. Damage
[ ~Explosion, Collapse,
Unclerground Hazards
AUTOMOBILE LIABILrTY'
[ ] Any Auto
[ ] Ali Owned Autos
[ ] Scheduled Autos W7 1 4 1 9 6 2 7
[~ Hired Autos
,rz~ Non-Owned Autos
[ ] Garage Liability -"
EXCESS LIABILITY
[ ] Umbrella Form
[ ] Other than Umbrelta FOrm
WORKERS' COMPENSATION
Effective Date
7 11-1-00
11-1-00
Expiration Date
11-1-01
1t-1-01
All Limits In Thousands
General Aggregate $ 2,0 0 0
Prods-Comp/Ops Agg.
Pers. & Advg. injury
Each Occurrence .
Fire Damage
(Any One Fire)
Medical Expense
(Any One Person)
CSL
Bodily Injury
('Per Person)
Bodily Injury
--(Pier o~:curm-nc~)
Property
EACH OCCURRENCE
2,000
$ 1,000
;0o0
$ 1,000
$. 10
$ 1,000
AGGREGATE
STATUTORY
$!., 0 0 0 Each Accident
Disease-Policy Limit
Disease-Each Employee
PLOYER'$ LIABILITY NWC478436 7-28-00 7-28-01
I'oT. .
Desc,~tionofOperations/LocationsNehictes/Speciatltems: All operations as described above
It is cer~3ed thata waiver of subrogation is hereby issued to the City of Tustin as pertains to the t~rms of all Workers Compensation insurance.
The issuing company will give thirty (30) d.ays written notice to ~itation.
DATE ISSUED:. 1 0- z] - 2 0 0 0 . '
Author[zed Ae~i-eseniative of the abo~,e-~med insurance company(les)
ASSIGNMENT OF LEASE
This Assignment of Lease ("Assignment") is made as of October ,2000
between Marcia Sanserino, 22351 Eagle Rock Way, Laguna Beach, California 92651
dba Mom's Sports Caf6, 12850 Robinson Drive, Tustin, California 92780 ("Assignor"),
and Luigi Ravetto and Amy Ravetto, 8215 East White Oak Ridge, #8, Orange,
California 92869 dba Express Sports Caf6 ("Assignees").
RECITALS
A. The City of Tustin, a municipal corporation, ("City") is the owner of the
20-acre Tustin Sports Park site located at 12850 Robinson Drive, Tustin, California.
B. The Tustin City Council is authorized by the provision of Government
Code Section 37396 to lease City park and recreation property for the provision of
services consistent with public park and recreation purposes.
C. The City desired to lease tenant space at the Tustin Sports Park
property for the purpose of operating food/beverage concession.
D. The City, as landlord ("Landlord"), and Assignor, as Tenant, executed a
Lease Agreement dated January 19, 1999 for Assignor to operate a food/beverage
concession consistent with public park and recreation purposes ("Lease"), a copy of
.which is attached hereto and incorporated herein by reference as Exhibit "A",
pursuant to which Landlord leased to Tenant and Tenant leased from Landlord that
certain portion of property at the Tustin Sports Park located at 12850 Robinson Drive,
Tustin, California, which is described and depicted on Exhibits "A" and "B" attached to
the Lease and incorporated herein by reference for a term of five (5) years, subject to
earlier termination as provided in the Lease.
E. Pursuant to section 18.7 of the Lease, Assignor desires to assign the
Lease to Assignees, and Assignees desire to accept the assignment of the Lease
from Assignor and assume all obligations under the Lease, subject to approval of this
Assignment by the Tustin City Council.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are acknowledged, Assignor and Assignees agree as follows:
Section 1. Assignment
Subject to approval of this Assignment by the Tustin City Council, Assignor
assigns and transfers to Assignees all rights, interest, and obligations in the Lease
and Assignees accepts from Assignor all rights, interest, and obligations in the
Lease, subject to the terms and conditions set forth in this Assignment.
26618\1
Section 2. Assumption of Lease Obligations
Subject to approval of this Assignment by the Tustin City Council, Assignees
assume and agree to perform and fulfill all the terms, covenants, conditions, and
obligations required to be performed and fulfilled by Assignor as lessee under the
Lease, including the making of all payments due to or payable on behalf of the City
under the Lease as they become due and payable.
Section 3. Assignor's Covenants
Assignor covenants that the copy of the Lease, attached hereto as Exhibit "A",
including Amendment No. 1 to the Lease dated April 1, 2000, attached hereto as
Exhibit "B", is a true and correct copy of the Lease as is currently in effect and that
there exists no other agreement or agreements affecting Assignor's tenancy under
the Lease.
Section 4. Litigation Costs
If any litigation between Assignor and Assignees arises out of this Assignment
or concerning the meaning of interpretation of this Assignment, both Assignor and
Assignees agree to indemnify and hold harmless the City.
Section 5. Indemnification
Assignor agrees to indemnify Assignees from and against any loss, cost, or
expense, including attorneys' fees and court costs relating to the failure of Assignor
to fulfill Assignor's obligations under the Lease, and accruing with respect to the
period on or prior to the date of this Assignment. Likewise, Assignees agrees to
indemnify Assignor from and against any loss, cost, or expense, including attorneys'
fees and court costs relating to the failure of Assignees to fulfill obligations under the
Lease, and accruing with respect to the period subsequent to the date of this
Assignment.
Section 6_ Successors and Assigns
This Assignment shall be binding on and inure to the benefit of the parties to it,
their heirs, executors, administrators, successors in interest, and assigns.
Section 7_ Governing La~w
This Assignment shall be governed by and construed in accordance with
California law.
26618\1 2
IN WITNESS WHEREOF, the parties hereto have executed this Assignment of
Lease on the day and year first written above.
ASSIGNOR:
Marcia Sanserino
dba Mom's Sports Caf6
22351 Eagle Rock Way
Laguna Beach, California 92651
ASSIGNEE.St.
dl ,SSlSports cafb
8215 : v~ite Oak Ridge, ~8,
Orange, California 92869
CONSENT OF LANDLORD
The undersigned City, as Landlord under the Lease, hereby consents to this
Assignment of the Lease to Assignees, provided however, that notwithstanding this
Assignment and the undersigned's consent to this Assignment, Assignor shall remain
primarily obligated as tenant under the Lease and the undersigned does not waive or
relinquish any rights under the Lease against Assignor or Assignees.
CITY OF TUSTIN:
Jeffery M. Thomas, Mayor
Attest:
Dated:
Approved as to form:
Beverley VVhite
Chief Deputy City Clerk
Lois E. Jeffrey
City Attorney
26618\1 3
XHIBIT A
I~EASE AGREEMENT
THIS LEASE is made and entered into.on this / ~ day of ,19 5~
by and between the CITY OF TUSTIN, hereimfter referred to as "CCrI~" and Marcia Sanserino, 20
Rincon, Irvine, California, 92620, dba Mom's Sports Cafe, hereinatier referred to as "LESSEE";
The City is the owner ofthe 20-acre Tustin Sports Park site, located at 12850 Robinson Drive
and depicted on Extn~ A attached hereto and incorporated herein by reference.
g¸o
The City Council is authOrized by the provision of Government Code Section 37396 to lease
City park and recreation property for the provision of services consistent with public park and
recreation purposes; and
Co
City desires to lease tenant space at the Tustin Sports Park property for the propose of
operating a food/beverage concession; and
D.
City desires to lease portions of the Sports Park site for such pm'poses in accordance w/th the
terms and conditions set forth in this Lease.
AGREENm-NT
NOW, 2lqEREFORE, in consideration of the mutual covenants, promises and conditions set forth
hercqn hereinaiter contained, the parties hereto agree as follows:
· 1..0,,DEMISED PREMISES
1'.1 City leases to Lessee for its management and operation certain 'real property
improvements which consist of a concession lease space of approximately one thousand (1,000) square
feet for food and beverage concession, together with certain stmct~es, bustlings, storage and/or
improvements (collective~ the "demised premises"). The concession lmil~g plans are shown on
Extfibit B attached hereto and incorporated herein by reference. The portions of the concession
building being leased hereunder as the demised premises are specifically demarcated on Exh~t B. The
demised premises (specifically including the structures, buildings and/or impr. ovements thereon) shall be
surrendered to the City upOn temmtion of this Lease.
1.2 The demised premises shall be used only and exclusively for concession operations and
such other purposes as are related thereto, provided express written approval therefor is granted by the
City Manager, or his designee, and for no other purpose whatsoever.
1.3 Lessee acknowledges personal inspection of the proposed park; as depicted on Exhibit
A, and concession impr. ovements as depicted on Extnbit B, and the surrounding area and evaluation of
the extent to which the physical condition thereof will affect the operation of the concession Lessee
accepts the demised premises in their existing physical condition as shown on construction plans and
agr~s to make no demands upon the City for any improvements or alteration thereof.
1.4 Lessee shall construct upon the demi.~ed premises the required tenant improvements in
accordance with the provisions set forth in Section 8 hereinafter and the attached Extn'bit C attached
hereto and incorporated herein by reference. Said project and any changes thereto shall be subject to
the prior approval of the City. All such construction shall be at Lessee's sole expense.
1.4.1 Any other improvements, additions, alterations or changes to the demised premises
shall be mbject to: prior approval bythe City Manager; securing of applicable permits; and compliance
with such terms and conditions as may be impo, sed thereon by the City.
1.5 Lessee hereby acknowledges the title of City, and/or any other public agencies'having
jurisdiction thereover, in and to the demised premises and the' improvements located thereon, and
covenants and agrees never to assail, contest or resist said rifle.
1.6 Ownership of all tenant improvements constructed by Lessee upon the demised
premises and all alteration, additions or betterments thereto, shall immediately vest and be vested in
City at all times during and after the term hereof; without compensation being paid therefor. Such
structures, buildings and/or improvements shall be surrendered to the City with the remainder of the
demised premises upon termination of this Lease.
2.1 The term of this Lease shall be for a period of five (5) years, commencing on the first
day ofthe calendar month su~eding a sixty (60) days notice to proceed being issued to the Lessee.
2.2 In'the event Lessee holds over beyond the term herein provided wkh the consent
express or imp. fled of City, such holding shall be from month to month only, subject to the conditions of
this Lease; such holding shall not be construed as a renewal of lhi.q Lease and shall be at the monthly
compensation provided herein.
2.3' Lessee may apply for an extemion of the term of this Lease for up to two timber
successive terms'of five (5) years each (conectively the option terms); provided that no later than sixty
(60) days prior to the expiration date of the respective term, the City receives a written request
therefor, signed by Lessee. The City Counci shall have exclusive discretion to determine whether to
grant or deny Lessee's application. City shall have the right to deny/approve the grant of an extension
of thi.~ Lease (and/or) to renegotiate the terms of this Lease, including but not limited to basic service
obligations, rn~imum concession payments, and required temnt impjovements. Lessee's option to
extend this Lease shall also be con~ditional on all of the following:
1. Lessee is in good faith compliance with terms of this Lease;
.
This Lease has not been canceled by City prior to the expiration of the term of
(2)
.
.
o
this Lease;
Lessee is not in default under this Lease;
Lessee has not abandoned, vacated or discontinued operations for a period in
excess of five (5) days. This does not include successive days of inclement
weather or days that the City has given prior aPProval to be closed. If the City
closes the park, it is deemed to be approval to close.
Lessee has received satisfactory performance evaluations from City.
3.0.. KENT
3.1 From and atter the lease commencement date, Lessee shall pay to City a minimum
monthly rent which will be payable on the first day of each month. This rent will be $300 per month .
for the first twelve months, and will be $400 per montli thereafter. From and after the expiration of the
second full year of the initial term, City will, every year on the anniversary of the lease commencement
date, notify Lessee of an adjustment in the ~_ mimnm Annual Rent. The adjustment shall be measured
by the lVfmimum Annual Rent for the first full year of the initial term times the lesser of (a) the increase
in the consn_~mer price index for All Urban Consnmers, Ail Items, base year 1982-1984 = 100, for the
Los AngelesJAnaheim/Rivcn~ide geographical area as compiled by the United States Department of
Labor for the mediately prig. year, or Co) four percent (4%)..
3.2 Percentage Rent.
In addition to the Ivfinimum Annual Rent, Lessee shall, on a quarterly basis, pay Percentage
Rent ~n'~oss ~lo~es ~---ual to ten percent (10%) of gross sales over $3,_000 per month. Said. Perce_.~_. tag. e
Rent ~hal~become ~e and payable quarterly on the twenty fifth (25~) day of the month ,mmechately
following the end ofthe first quarter.
The City's aczeptance'of any monies paid to City by Lessee as Percentage Rent, as Shown by
any statement furnished by Lessee, shall not be construed as an admission of the accuracy of said
statement, or of the sufficiency of the amount of said Percentage Rent payment, but City shall be
entitled to revie~v the adequacy of such payment as hereinabove set forth.
3.3 Gross Sales.
(a)
The term "Gross Sales" as used herein Shall mean:
(1) The entire amount of the acU~ sales price, whether wholesale or retail,
and whether wholly or partly for cash or on credit or in exchange for any other product, commod/ty,
service, commercial paper or forbearance, of ail sales of merchandise and all charges made by Lessee
and its employees or others acting on its behalf for the rendition of services of any kind whatsoever,
made from or upon the demised premises.
(3)
(2) All other receipts of all business conducted in, at or from the demised
pretties, including all deposits not refunded to purchasers, proceeds, rece~ts or any revenue derived
whatsoever from the use of demised premises (i.e. rental, repair or cleaning of tenn~ equipment, tennis
reservation fees, tournament fees, fees for lessom, etc.).
(3) Orders taken in or from the demised premises although said orders may
be filled elsewherel and sales by any subtenant in or from the demised premises, and ail without credit
to Tenant for uncollected or uncorrectable credit accounts.
(4) GrOsS receipts of all coin-operated devices which may be phced in the
demi.qed premises by Tenant or under any rent concession, percentage or other arrangement including,
without limitation, such devices as pinball machines, vending machines, video games and ~
devices (but excluding revenue fi-om telephones that are collected by a public and/or private utility),
except that nothing herein shall be construed as Citys consent to the use of same in the demised
premises; and
(5) All other revenues or receipts generated by or arising from the use of
the demised premises.
Co) Exclusions from Gross Sales, Notwkhsmnding anytl~g to the contrary
contained herein, Gross Sales shall not include, or if included there shall be .deducted (but only to the
extent that they have been included), the following:
·
(1) Sales and use taxes, so-called kmury taxes, commmers' excise taxes,
gross receipts taxes, and other ~ taxes now or in the future im?sed on the sale of merchandise or
"~ervices, but only if such taxes are added to the selling price and collected from customers.
(2) The transfer or exchange of merchandise between ,the stores or
businesses of Tenant, if any, where such transfers or exchanges of merchandise are made solely for the
convenient operation of a business owned and operated by Tenant and not for the purpose of
consummating a prior sale made in, to or from the demised premises or for the propose of depriving '
City of the benef~ of a sale which otherwise would be made in, at or from the de~qed premises.
(3) The mount ofretmm to shippers or manufacturers.
..
(4) The amolmt of any cash or credit refund made upon any sale where the
merchandise sold or some pan thereof is thereafter returned by the purchaser. Each sale upon
· inst~llment or credit shall be treated as a sale for the full price in the month during which such sale shall
be made, irrespective of the time when Tenant shall receive payment (whether in full or partial) from its
customers.
(5)
which are not stock in trade.
(6)
damage to merchandise.
Sales of trade fixtures or personal property to be replaced by Tenant
Sums and credits received in the settlcnnent of claims for loss of or
(7) Gift certificates, or similar vouchers, until such time as they shall have
been}Convened into a sale by red.on.
(8)
(9)'
purposes without charge.
(10)
Meals provided for officers or employees without charge.
Meals, goods or products provided for promotional or publicity
'Cash refunds made to ct~omers in the ordinary course of business.
(11) Value added taxes ('WAT") or other taxes added to the selling price of
products and other sim~ taxes now or hereafter impo. sed upon the sale of merchandise or services,
whether such taxes are added to the selting price or included therein.
(12) Discounted sales to en~ployees of Tenant, not to exceed 2% of Gross
Sales.
(c) Sta)ements of Gross Sales. Lessee shall furnish to City statements of Lessee's
Gross Sales within twenty (20) days after the end of each applicable Percentage Rent quarter. Each
statement shall be signed and certified to'be correct by an officer or employee of Lessee.
·
3.4 Payment shall be payable at the office of the City Manager at 300 Cemennial Way,
~rustin, CA or at such other place or places as City may, from time to _time, designate by written notice
to Lessee delivered on or before the fifteenth day of each month following initiation of the term of this -
.-.Lease.
3.5 Rent and other sums due City under this Lease shall be due when specified in this
Lease and shall bear a late payment charge of two percent (2%) per month if not paid within ten (10)
calendar days after the date on which payment is due. In no .event, however, shall any such late
.charges exceed the maximum amount permitted by law. Any returned checks will be assessed the
maxirmzm fee for returned checks permitted by State law to cover bank charges. In addition, the late
payment charge shall be added unless the replacement payment is made within the ten (10) calendar
day grace period.
4.0 ACCOUNTING KECO~S
4.1 All sales shall be recorded by means of cash registers which publicly display the amount
of each sale and automatically issue a customer's pre-numbered receipt or verify the amount recorded
on a slip. Said cash register shall in ail cases have locked-in sales totals and tran~ctions counters
which are constantly aco_~mulating and which cannot, in either case, be reset, and in addition thereto, a
tape located within the register on which transaction numbers and 'sales details are '~ ,nuprimed.
Beginning and ending cash register readings shall be made a matter of daily record. In the event of a
technical or electrical failure of the cash register' Lessee shall record by hand ail collections, and issue a
sequentially pre-numbered customers receipt in like manner.
(5)
} 4.2 Lessee shall be required to mainta~ a method of accounting, to the satisfaction of the
City, which correctly and accurately reflects the gross receipts and disbursements related to tenant
impr~ ovements and maintenance costs of the Lessee in connection with each type of authorized
operations (food and beverage concession). The method of accounting, including bank accounts
established for said operations, shall be separate fi-om the accounting system used for any other
business operated by Lessee or for the recording Lessee's personal financial affairs. Such method shall
include the keeping of the following documents:
a. Regnlar books of accounting such as general ledgers.
b.
Journals inchding any supporting and underlying docmnents such as vouchers, checks,
tickets, bank statements, etc.
State and Federal income tax remms and California sales and use returns and checks
and other documents providing payment of sumq shown.
Cash register tapes (daily tapes may be separate but shall be retained so that from day
to day the sales can be identified).
e.
Any other accounting records that the Finance Director or City Manager deems
necessary for proper reporting of receipts.
4.3 'An documents, books and accounting reco~ shall be open for inspection and re-
inspection at any reasonable time during the term of thk Lease and for four (4) years thereafter. In
addition, the Cky may from time to time conduct an audit and re-audit of the books and business so
that accuracy of the above records can be confirmed. All information obtained in connect/on with the
City's inspection of records or audit shall be treated as confidential information, and, to the extent
permitted by. law, exempt from public disclosure thereof. Lessee shall cooperate with City in making
the impectio~
4.4 In the event that an audit or review conducted by the City finds that due to Lessee's
non-compliance with its obligation to report gross r~ts in connection with its operations authorized
herein, an actual loss and/or projected loss of revenue to City can be dete~uinect, the City, at its option
.~hall: (1) bill Lessee for said losses, said mount to be paid to City within thirty (30) days following
b~lling therefore unless otherwise extended by the City Manager, and/or (2) use the Security Deposit as
provided for herein; and/or (3) terminate thi.q Lease.
4.4.1 Should the City find that the additional rental payment due to City exceeds two percent
(2%) of the total amount which should have been paid as determined by such review or audit and
observation, and there being no reasOnable basis for the failure to report and pay thereon, Lessee shall
also pay the cost of the audit as determined by City and pay late charges as heretofore provided for the
delinquent paymems.
4.5 Lessee shall furnish the City .with a monthly gross receipts report showing the amount
payable therefrom to the City. Such a report shall accompany each monthly payment required to be
(6)
made as provided hereir~ The monthly reporting period shall be by calendar month, rather than
monthly anniversary date of the effective date of this Lease. In adclition thereto, Lessee shall furnish
the ~ity with monthly profit and loss statements and an annual profit and loss statement and a balance
sheet prepared by a person and in a form acceptable to said City. The monthly profit and loss
statements shall be submitted with the monthly rental payment. The annual financial statement shall be
submitted within sixty (60) days alter the close of the Lease year. Said closing date ~aI1 be determined
by reference to the date for commencement of the term herein provide&
5.Q
BUSINESS PURPOSES AND BASIC SERVICE OBLIGATIONS
5.1 Food and Beverage Concession Operations
A. Business Purposes
The demised premises are to be used by Lessee for the operation of a food and
beverages concession area and 'associated retail operations all in substantial accordance with the
Lessee's proposal to the City for operation of the demised premises. Copies of the portions of the
proposal relevant to goods, services and operations provided, are attached hereto as Extn~bit D and
incorporated herein by reference. To the extent of any conflict between the provisions of the proposal
and the provisions ofthis Lease, the provisions ofthis Lease shall conlxol.
B. Lessee's Staff
Lessee shall be responsible for each member of its food and beverage staff to
comply with all regulations as determined by the Orange County Health Department in food
preparation
Lessee shall be responsible for hiring the necessary'personnel'to conduct
opemti0ns. Lessee shall comply with all federal, state and local laws relating to minimum wage, social
secnnSty, civil rights, ADA, unemployment compemation .and workers' compensation Lessee shall
require all employees to observe all applicable City rules and regulations and to exercise courtesy and
consideration in their relations with the public.
C. Days and Hours of Operation
Lessee 'shall submit for City's approval a schedule setting forth hours of
operation for the business. Any curtailment or decrease of this service is subject to the prior written
approval of the city. The above days and hours of operation shall be complied with unless advance
wrkten authorization to deviate from this schedule has been obtained form the Cky Manager.
The hours of operation would be subject to change to adjust to the needs of the '
conmmity. Special hours would be added to accommodate spec/al tournaments or events. The hours
designated at the outset ofthe lease shall be:
Fall and Spring:
Monday thru Friday
2:30 p.m to 9:30 p.m
(~)
Wrater (Dec to Jan)
Saturday
Sunday
Monday thru Friday
Saturday
Sunday
Holiday Weekday
9:00 a.m. to 9:30 p.m
12:00 noon to 5:00 p.m
5:00 p.m. to 9:00 p.m
9:00 a.m to 5:00 p.m
Closed
Closed
Summer
Monday thru Friday
Saturday
Sunday
11:00 a.m. to 10:00 p.m.
9:00 a.m. to 10:00 p.m.
12:00 noon to 5:00 p.m.
D. Food and Beverage Products
Lessee shall provide and maintain the necessary food and beverage products
required to satisfy the public demand therefor. All such products sold or kept for sale by Lessee shall
be first class in quality, wholesome and pure and shall conform to the Federal, State County and City
food laws, ordinances and regulations in all respects. No adulterated, mi.qbranded or impure articles
shall be sold or kept for sale by Lessee and all food and beverage products kept on hand by Lessee
shall be stored and handled with due regard for sanitation In the event that Lessee's food and beverage
products are deemed by City Manager to be less than first class in quality, said officer shall have the
fight to order the improvement of the quality of any such products kept or offered for sale.
5.2 Exclusivity
Lessor agrees that LesSee shall have the eXclusive right to conduct a food and
.beverage concession business on the Sports Park site. The City of Tustin reserves the right to
determine four (4) public event days sponsored by the City of Tustin without Lessee's prior written
consent for the purposes of pr°riding alternative food and beverage services.
6.0 MAINTENANCE
6.1 Building, Equity. ent and Grounds Maintenance
A. Lessee shall~ at its cost and expense during the term of thiu Lease, keep and
maintain the demised premi.~es and ail improvements, .fixtures, trade fixtures, equipment and utility
systems which may now or hereatter exist thereon, in good, operable, useable and sanitary order and
repair and in a good, safe and first-class condition throughout the term ofthi.~ .Lease, providing for such
repairs, replacements, rebuilding and restoration as may be required'by the City to comply with the
requirements hereof. All such repairs and/or any modifications or additions to the facili~es shall have
the approval ofthe City prior to their implem~tation
B. Should Lessee fail, after ten'(10) days notice from City of the need thereof, to
perform its obligations required hereunder,' City in addition to all other available remedies may, but
shall not be obligated to, exercise its right-of-en~ as provided hercqnaf~er in Section 23. Lessee shall
forthwith on demand reimburse City for its costs incurred in connection with such right of entry
including direct and indirect overhead costs as determined by the City.
(8)
C. In regard to the level of maintenance, all work shall be performed in accordance
witl~the highest industry-wide maintenance standards at established frequencies so as to maintain the
aesthetic level and proper condition of the concession facility.
D. Regularly scheduled inspections of the demised premises and of Lessee's operations
authorized herein shall be made by the City. The written report of such inspections shall be recorded,
retained for reference, and fonvarded to 'Lessee upon request.
E. In regard to emergency services, the Lessee will provide the City with the names
and telephone numbe~ of at least two (2) qualified persons who can be called by City representatives
when emergency maint~ce conditions occur dumg hours when the Lessee's normal work force is
not present. The City shall call for such assistance only in the event of a genuine and substantial
emergency.
F. The Lessee at its sole cost and expense shall finnish ail necessary equipment,
supplies and material of good qualky and in sufficient number to kfltiI1 the requirements of this Lease
and to acco~lish an acceptable and professional level of maintenance.
G. City shall be responsible for the maintenance and repak of the exterior of all
concession structures, except to the extent that City finds that Lessee is respons~le for damage to the
exterior of a concession structare. In that case, City shall have the option of either requiring Lessee to
.repair the damage, or repairing the damage itself, at Lessee's expeas, e.
6.2 Operation of Demised Premises. Lessee shall operate and manage the demised
premises in a first-class manner, comparable to other first-class businesses providing similar facilities.
7.0 OPERATING RESPONSIBILITIES
7.1 Compliance with Laws
Lessee shall conform to and abide by. all City and coming ordinances, and all state and
federal laws and regulatiom, insofar as the same or any of them are applicable; and where ~s
and/or licenses are required for the food and beverage and/or tennis operation heretmder and/or any
consm~on authorized herein, the same must be first obtained ~om the regulatory agency having
jurisdiction thereover..
7.2 COmpliance with Rules and Regulations
Lessee shall conform to and abide by all rules and regulations of the City Coun~ md
the City Manager insofar as the same or any of them are applicable.
7.3 Disorderly Persons
Lessee shall exercise every reasonable effort not to allow any loud, boisterous or
(9)
disorderly persons to loiter about the demised premises.
7.4 Illegal Activities
Lessee shall not knowingly permit any illegal activities to be conducted upon the
demised premises.
7.5 ~
Lessee shall not post si~.q upon the demised premises or improvements therein unless
prior written approval therefore is obtained from the Community Development Director. Compliance
w/th the City's sign ordinance provisions shall be the responsibility of the Lessee. This approval shall
not be unreasonably withheld.
7.6 Lessee's Staffand Employment Practice
Lessee shall maintain an adequate and proper staff. The City may at any time give
Lessee written notice to the effect that the conduct or action of a designated employee of Lessee is, in
the reasonable belief of the City, detrimental to the interest of the public patronizing the demised
premises. Following City's written notice therefor Lessee shall, at City's discretion: (1) terminate Such
employee's work assi~ment at the demised premises or (2) meet with representatives 'of the City to
consider the appropriate course of action with respect to such matter and Lessee shall take reasonable
'measures under the circumqances to assure the City that the conduct and act54fies of Lessee's
employee will not be detrimental to the interest of the public patronizing the demised premises.
" A. Lessee shall establish an identification system for personnel assigned to the
concession facility which clearly indicates to patrons 'the name of the person(s) on duty. The
identification system shall be famished at the Lessee's expense and may include appropriate attire, name
badges and/or name plates as specified by the City.
B. Lessee warrants that it fully complies wkh all laws regarding employment of
aliens and others, and that all its employees performing services hereunder meet the citizenship or alien
status requirements contained in federal and.state statutes hnd regulations. Lessee sba3 obtain~ from all
covered employees perfo~g services hereunder,, all verification and other documentation of
employment eligltaI~ stares required by federal and state statutes and regulations as they curr~y
exist and as they may be hereafter mended. Lessee shall retain such docmnentation for all covered
· employees for the period prescribed by law. Lessee shall indemnify, defend, and hold harmless, the
City, its offices and employees from employer sanctions and any other liability which may be assessed
against Lessee or city or both in connec~on with any alleged violation of federal and/or state statutes
or regulations pertaining to the eligl'bility for employment of persons performing s~xvices under this
Lease.
7.7 Utilities
A. Lessee shall make all arrangements for and pay for all applicable utilities
fmuished to or used on the demised'premises including without limitatiom gas, electricity, water,
(10)
refuse removal, telephone sexvice, cable TV, etc. In addition, upon expiration or earlier termnation of
any ltreexisfing City concession agreements, Lessee shall provide for the transfer of all applicable utility
accounts from any prior concessionaire to Lessee and thereafter shall pay for said utilities.
B. Lessee waives any and all c!a~m~ again~ C'!tY for compensation for loss or
damage caused by a defect, deficiency or impakment of any utilities system, water system, water
supply system, drainage, sYStem, waste system, heating or gas system, electri~ apparatus or wires
serving the demised premises. City shall warrant ail underground or '~dden" plnmbing, utilities and
structure.
7.8 Sanitation
Lessee shall keep the demised premises free-and clear of rubbish and litter and shall
deposit rubbish and litter in containers designated by City. Trash containers shall be kept in an
approved enclosed area. City shall Charge Lessee monthly for rubbish removal, at rotes no greater than
the stan~d rate charged other commercial users for City rubbish removal services.' No offensive
matter or refuse or substance constitufi'ng an nnnecessary, unreasonable, or unlawful fire hazard, or
material detrimental to the public health shall be permiaed to remain on the demised premises and
Lessee shall prevent any accumulation thereof from occurring.
7.9 Security Devices
Lessee may provide any legal devices, mechanisms or equipm~t desigmed for the
purpose of protecting the demised premises from theft, burglary or van&ti.qm, provided written
approval for installation thereof is first obtained from the City. Ail purchases and installation thereof
Shall be at Lessee's expense. During the last thirty (30) days prerxding the termination of this Lease,
Lessee shall remove ~me from the dem[qed premises, except for those items of personalty which have
been furnished by City or have been so aftqxed that their removal therefrom cannot be accomplished
without damage to the realty as determined by the City.
7.10 Prices
Lessee shall at all times ~ a complde Est or schedule of the prices
charged for an goods and services, or combinations thereof, supplied to the public on or from the
dcnnis~ pren~es. Said prices shall be fair and reasonable based upon the following considerations.:
that said operation is intended to serve the needs 'of the public for the goods and/or services supplied at
a fair and reasonable cost; ~mparability with prices charged for similar goods and/or services supplied
in the Orange County area; and reasonableness ofprofit margin in view of the cost ofproviding same in
compliance with the obligations assumed in this Lease. 'In the event the City notifies Lessee that the
prices being charged are not fair and reasonable, Lessee shall have the right to confer with the City and
justify said prices. Following reasonable conference and consultafion'thereon, Lessee' shall make such
price adjustments as may be ordered by the City. Lessee may appeal the det~m~ination of the City to
the City Council, whose decision thereon shall be final and conclusive. However, Lessee shall comply
with the ordered price adjustment pending the appeal and final ruling thereon by the City Councnl
7.11 Safety_
(11)
} Lessee shall immediately correct any unsafe condition of the demised premi.~es, as well
as any unsafe practices occurring thereon Lessee shall obtain emergency medical care for any
employee who is in need thereof, because of illness, or injury occun/ng on the demised premises.
Lessee shall cooperate fully with City in the investigation of any injury or death occurring on the
demised premises, including a prompt report thereof to the City Manager.
7.12 .Quati_ty of Goods and Services
Services to the public, with goods and merchandise of the best quality and at
reasomble charges, is of prime concern to City and is'considered a part of the consideration for thi.~
Lease. Therefore, Lessee agrees to operate and manage, during the entire term of this Lease, the
.facilities in a first-class manner, and comparable to other similar facilities and services. Where such
facilities are provided, Lessee shall furnish and dispense foods and beverages of the best quality and
shall maintain a high standard of service at least equal to that of other food/beverage snack bar
establishments in City and/or adjacent communities and to those prevailing in such areas for similar
products and services, and withouf discrimination Lessee, following rece~ of written notification
therefor, shall immediately withdraw or remove from sale any goods or services which may be found
objectionable to the City based on findings that the provision of such goods or services are harmful to
the public welfare.
7.13 .Reporting
The Lessee or his representative shall meet with the City Manager or his representative
at such other times as may be required by the City to review Lessee's performance under this Lease and
to-discuss any problems or matters as detem~ed bythe City.
7.14 Trade Fixtures
Lessee at its own expense shall provide and install an appliances, furniture, fixtures,
equipment, door locks and padlocks or personal property that are required for the operation of the
demi.~ed premises. Dtu/ng the last thirty (30) days preceding the termination of this Lease, Lessee shall
remove same from the demised premises, other than for those items which have been so affixed that the
removal therefrom cannot be accomplished without damage to the realty. Should Lessee fail to so
remove said appliances, furniture, fixtures, equipment, door locks and padlocks within said thirty (30)
days period, Lessee shall lose all right, title and interest in and thereto, and City may elect to keep same
upon the demised premises or to sell, remove or demolish same. Lessee shall reimburse City i'or any
cost, as determined by the City Manager, incurred in excess of any consideration received from such
sale, removal or demolition.
7.15 Habkation
The demised premises shaIl not be used for human habitation
7.16 Nuisances and Annoyances
(12)
Lessee shall not use or permit the use of the demi.qed premi`qes in any manner which
crea~es a nuisance or measurable annoyance to. persons outside the demised premises, including,
without limitation, live, recorded or broadcast entertainment or the use of loudspeakers or sound or
light apparatus other than as may be required by law or necessary or advisable for safety purposes and
other than a customer paging system.
7.17 Inspection
Services, equipment and improvements shall be subject to inspection and approval by
the City Building Department, the County Health Department, and the Fire Marshall~ as applicable.
8.0 KEQUIRF. D TENANT IMPROVEMENT PROGRAM
8.1 A tenant improvement program shall be prepared by Lessee and approved by the City
which Shall indicate the description of the tenant impjovements proposed by Lessee in order to operate
said concession, the estimated impJovement costs, and the projected time frame for commencement
and completion of the tenant improvement project. It is understood that the construction' and/or
impr. ov~ts required herein may, at the discretion of Lessee, be constructed in phases, each phase
being separated from the other by a period of time to be mutually agreed upon by Lessee and the City
Manager. In no event' shall the phasing of the construction required herein extend the completion
thereof beyond the date heretofore provided, subject to the prov/sions ofparagraph 8.4..
·
8.2 City and Lessee may agree from time to time that various additional tenant
i.mprovement(s) mutually agreed upon, shall be completed as necessary to improve and/or ensure the
USeabilky of the demi.~ed prem~s.
.8.3 Prior to commencement of construction, Lessee shall obtain City's wrkten approval of
ail plan% specifications and construction cost estimates by Lessee for the tenant improvements to be
constructed upon the dem[qed premi.qes. No modification 'of said plan.q, specqfications, or tenant
~mpr. ovements, shall be made'by Lessee without approval thereof by the City. Lessee agrees that City
may have on the site at any time during the construction improvement period an 'inspector who shall
have the right of access to the demi.qed prerni`qes and the construction work.
8.4 The parties agree that any delay in the construction due to 'fire, earthquake, war, labor
dispute or other events without fantt and beyond the control of Lessee shall extend the time in which
said construction must be completed by the length of time of such delay.
8.5 Lessee shall 'constmct, perform, complete and mainta~ all construction and
inst_allations covered by thi`q Lease in a good and workmanl~e manner and with high quality materials,
and shall ftu~h all tools, equipment, labor and material necessary to perform and to complete same.
Upon completion of the tenant impr. ovements, Lessee shall furnish the City with one (1) complete set
of as-built construction drawings on mykr or its equivalent (all circuit breakers, mechanical equipment,
switches, plumbing and fire sprinkler section and main values shall be plainly labeled and a master 'index
shall be provided); operating man~ for bustling equipment and systems; and copies of all written
warranties. Upon t~on ofthi.q Lease whether by expiration of term or cancellation, Lessee shall
(13)
assign to City all express warranties furnished by other persons in connection with the provision of'
labaf and/or material to the works of impjovement' covered by this Lease. Upon review by and
consultation with City's Finance Director or City Attorney, Lessee shall provide such insurance
coverage as City reasonably deem necessary for the contemplated construction project.
.9.0 ADVERTISING AND PROMOTIONAL MATERIALS
Lessor reserves the right to review and approve any advertising or promotional materials. Said
approval shall not be unreasonably withheld or delayed and shall be deemed to be given ff no objection
is made within fifteen (15) business, days fonowing the request for approval Such materials include,
but are not limited to: advertising in newspapers, magazines and trade joumals, and radio and/or
television commerciak.
Lessee may, at its own expense, place such siLm.q in or upon the demi.qed premi.qes as it may
'deem necessary subject to compliance with Sections 8600 et seq. and 9400 et seq. of the Tustin City
Code and provided consent by the City as to the type, design and method of installation is first obtained
and proper permits obtained. All signage placed by Lessee on, in or about the demi.~ed premises shall
remain the property of the Lessee and shall be removed by Lessee upon termination or expiration of
'this Lease at Lessee% expense, and any damage caused by such removal shall be repaired at Lessee's
e~e.
10.0 BONDS
10.1 During any period of construction of the tenant improvements herein required or
otherwise authorized, Lessee shall provide a performance bond in an amount of not less than one
hundred percent (100%) of the cost for the construction to be performed as evidenced by contracts for
all required tenant impr~ ovements, payable to the City of Tustin and executed by a corporate surety
licensed to do business in, and in good standing in, the State of California and acceptable to the Risk
Manager and City Attorney. The surety shall have a Best% Key Rating of at least A VII. The
condifi'on of the bond shall be such that if Lessee shall complete the required construction specified
herein in accordance with approved plans and specifications for the tenant impr. ove~ts and receive a
certificate of occupancy for the buil~g, then surety shall no longer be bound thereon Said bond shall
be main~ed in full force and effect by Lessee until said tenant improvements have been accepted by
the City.
10.3 The City Attorney n~ay accept in lieu of the bonds heretofore descdtxxt, the
performance and payment bonds of COrporations duly authorized to issue surety bonds by the State,
naming as principal a licensed contractor eng>loyed by Lessee to construct works of impjovement on
the demised premises provided each bond othemise conforms to the requirements set forth in 10.1 and
10.2 and names City as an additional obligee.
10.4 Lessee shall have the option to deposit with the City cash or United States Government
securities in all respects satisfactory to the City Attorney in lieu of the surety obligations herein
required. Said cash or seanifies shall be deemed deposited with City to secure full and satisfactory
(14)
i::~formance of the principal obligations h~retofore descn3xxt for which Surety is required, and shall be
releas~ upon satisfactory performance thereof, as evidenced by certification of completion by the City
Manager and unconditional release of mechauic's liens by all claimants. In lieu thereof, Lessee may
deposit the required _amount in a bank or other financial institution whose deposits are federally insured,
provided the account is made payable to City on demand and the ~cates of deposit are delivered to
the City Manager. Lessee shall be entitled to all interest on the deposit and to the remm of the
certificate of deposit upon satisfactory performance as heretofore define&
11.q DESTKUCTION OF DF. MISED PREMISES
11.1 in the event the demised premises shall be totally or partially destroyed by a
risk covered by the insurance coverage required herein, Lessee shall either restore the demised
premises or terminate this Lease. City shall make the loss adjustment with the insurance company
insmSng the loss and receive payme-at of the proceeds of insurance. If the destruction is from a risk for
which insurance coverage is not required or provided under said policy of insurance, City shall either
restore the demised premises or terminate this Lease. Said insurance proceeds, if any, shall be held for
the benefit of Lessee only'in the event of an election by Lessee to restore the demised premises and
shall be disbursed in installments as constmcti°n progresses for payment of the costs of restoration
upon satisfactory performance of the work required, as evidenced by certification of completion by the
City Manager and release of mechanic's liens by all persons furnishing labor and materials thereon. If
the proceeds ofinmmnce are insufficient to Pay the a~al costs of restoration, Lessee shall deposit the
amount of the deficiency with the City upon demand therefor by the City Manager, and said sums shall
be held for payment of said costs and disbursed in the manner heretofore provide& Amy undistn~buted
funds shall be retained by City and credited to the rental reserved over the remaining term of this Lease.
~Lessee elects to restore.the demised premises, plans, specifications, and construction cost estimates '
for the restoration thereof shall be prepared by Lessee and for~varded to .City for approval prior to the
performance of any work thereon. Said documents shall be prepared and submitted in a timely manner
following adjustments of the loss and receipt of the proceeds of inmrance by City. The required
construction shall be performed by Lessee and/or licensed and bonded contractor(s) thereof who shall
be required to carry comprehensive liability and property damage inmrance, workers' compensation
insurance, and standard fire, and extended coverage insmance, with vandalism and malicious mischief
endorsements, during the period of construction, in amounts equal to the insurance limits required
herein, or as otherwise determined by the City. Said construction shall be commenced promptly
following the approval thereof by the City, issuance of permits therefor by governmental agencies
having jurisdiction thereover, and posting of the construction site by City with notice of
nonresponsi~ity, and shall be diligently prosecuted to completion All work shall be performed in
accordance with the approved plans and specifications, unless changes therein are approved in advance
thereof by City. Lessee agrees that City may have on the site at any time during the construction
period an inspector who shall have the right to access to the demised premises and the work occurring
thereon Lessee, at the commencement of the construction work, shall notify City in writing of the
identity, place of business, and telephone number of responsible person(s) in charge of the consuuction
to be occunSng thereon All construction shall be performed in a good and worlcmanl~e manner.
Upon completion of the restoration, Lessee shall immediately record a notice of completion with the
Registrar-Recorder.
·
(15)
11.2 If the demi.~ed premises are restored, this Lease shall continue in full force and effect,
except that ff Lessee files a claim therefor with the City, the payment to be made by Lessee shall be
abated and/or other relief afforded to the extent that the City may det~nine the damage and/or
restoration interferes with the concession operation, provided any such claim shall be denied ff the
destruction of the demised premises is found by the City to have been mused by the fault or neglect of
Lessee. Lessee agrees to cooperate in the determination of the abatement and/or other relief to be
provided by furnishing all information requested relative to the concession operation, and permitting
examination and audit of all accounting records kept in connection with the conduct thereof.
11.3 Lessee shall cooperate in the restoration of the demised premiss by vacating the same
and removing therefrom all items of inventory, trade fixtures, equipment and furnishings for such
periods as are required for the restoration thereof.
11.4 The aforesaid provisions for abatement and/or other relief shall also be applicable to a
total or partial destruction of the demised premises by the aforementioned causes, except that the relief
to be provided shall be based upon the extent the City may determine that the reduction in the public's
use of the demised premises due to the partial or total closure thereof has affected the concession
operation
11.5 Lessee agrees to accept the remedy heretofore provided in the event of a destruction of
the demised premises and hereby waives-any and all additional rights and remedies for relief or
cprrpensation that are presently available or may hereafter be made available under the laws and
statutes of this State.
i~..0 CONSTRUCTION BY CITY AFFECTING DEMISED PREMISES
12.1 In the event City shall construct or cause to be constructed a new facility or renovation
on the demised premises, for reasons described in Section 11, this Lease shall continue in full force and
effect, except that the payments to be made by Lessee shall be abated and/or other relief afforded to the
extent that the City may determine the construction interferes with the Lessee's authorized operations,
provided a claim therefor is filed w/th the City within one hundred (100) days of the commencement of
construction- Lessee agrees that the provisions of Section 12 shall not apply to improvements
construCted pursuant to the tgnant improvement plan_
12.2 Lessee agrees to cooperate with City in the event the construction affects the demised
premises by vacating the same and removing therefrom all items of inventory, trade fixtures, equipment
and ~gs for such periods as are required by the construct/on of the new facilities. Lessee further
agrees to COOlX~te in the determination of the abatement and/or other relief to be provided by
furnishing all information requested relative to the operation and permitting examination and audit of all
accounting records kept in connection with the conduct thereof.
12.3 Following completion of the new or renovated facility, Lessee shall resume its
operations therefrom within thirty (30) days of written notice from the City Manager that the demised
premises are now available for occupancy.
(16)
12.4 The aforementioned provisions of thi~ section shall also be applicable in the event of
p~ce of work on the demised premises that requires a partial or total closure thereof, except
that the abatement and/or other relief to be provided shall be based upon the extent the City may
determine that the reduction in the public's use of the demised premises, due to the partial or total
closure thereof, has affected Lessee's operations.
12.5 Lessee agrees to accept the remedy heretofore,' provided in the event of construction
upon the demised premises, and hereby waives any and all additional rights and remedies for relief or
compensation that are presently available or may be made available hereafter under the laws and
statutes of this State.
13.0 INDEPENDENT CONTKACTOK
13.1 This Lease is by and between the City of Tustin and Lessee and is not intended and
shall not be construed, to create the relationship of agent, servant, employee, or representative of the
City by the Lessee.
13.2 Lessee understands and agrees that all persons furnishing services to Lessee pursuant
to ~his Lease are, for purposes of Workers' Compensation, liability, employees solely of Lessee, and not
of City.
' 13.3 Lessee shall bear the sole responsibility and liab'tlity for .furnishing' workers'
compensation benefits to any person for injuries from or connected with services performed on behalf
.of. Lessee pursuant to this Lease.
13.4 Lessee understands and specific.~y agrees'to inform its employees that Lessee is an
independent contractor to the City.
13.5 Lessee understands and specifically agrees to inform its employees that they are not
agents or employees of the City.
14.0 SECURITY DEPOSIT
14.1 Prior to the commencement of the term of this Lease, Lessee shall pay to the City a
surm equal to one-twelf~ (1/12th) of the M'mimnm Annual Rent. In lieu thereof, Lessee may deposit
said amount in a t~_nk or other financial institution whose deposits are federally insured, provided that
a certificate of deposit is delivered to the City Manager giving City the exclusive right to withdraw any
or al/of said amount at any time during the terin of this Lease. Lessee shall be entitled to any and all
interest ac.m~g from said certificate of deposit.
A. Said su~m shall serve as securky for faithful performance of all covenants,
prorates and conditions assumed by Lessee herein, and may be applied in satisfaction.and/or mitigation
of damages arising from a breach thereof~ incl~ding, but not limited to, delinquent payments; correction
of maintenance deficiencies; securing required ' .msm'a_nce; 10ss of revenue due to abandonment, vacation
(17)
or discontinuance of food and beverage operations or termi.q concession operations; completion of
cons~uction; and payment of mechanic's liens. Application of mounts on deposit in satisfaction
and/or mitigation of damages shall be without prejudice to the exercise of any other rights provided
herein or by law to remedy a breach ofthi.q Lease.
B. In the event any or all said mounts is applied in satisfaction and/or mitigation
of damages Lessee shall immediately deposit such sums as are necessary to restore the security deposit
to the full amount required hereunder.
C. Said sum shall be returned to Lessee upon termination of this Lease less any
amounts that may be wkhheld therefrom by City as heretofore provide&
14.2 Additionally, Lessee shall fiauish to City a faithfifl performance bond in a sum equal to
one-sixth (1/6th) of the M'mimurn Annual Rent payable to the City and executed by a corporate surety
licensed to do business in, and in good standing in the State of Califom and acceptable to the Risk
Manager and City Attorney. The surety shall-have a Best's Key Rating of at least A VII. Such bond
shall be satisfactory to City in all respects and shall be conditioned upon the faithful performance by
Lessee of the terms and conditions of this Lease and shall be renewed to provide for continuing liability
in the above amount notwkhstanding any payment or recovery thereon
A. The City Attorney may also accept from the Lessee, in lieu of the bond
heretofore descn~oed, the deposit of the r .equ/red amount in a bank or other financial institution whose
deposits are federally insured, provided that the amount is made payable to City on demand and the
certificate of deposit is delivered to the City Manager, or such other instrument such as an irrevocable
! ~etter of credit payable only to City and in. form and content accepm, ble to the City Attorney. Lessee
shall be entitled to all interest 'on the deposit and the remm of the ceaificate of deposit upon
satisfactory performance as heretofore defined.
15.0 HOLD HARMLESS AND INDEMNIFICATION
15.1 The Lessee shall indemnify and save harmless the City of Tustin and all officers,
employees, agents and independent contractors thereof from all claims, suits, or actions of every name,
kind, and description, brought for, or on account of; 'injuries to or death of any person including, but
not limited to, workmen and the public, or damage to property resulting from thc construction of the
work or by or in consequence of any negligence regarding the work, the use of~mpr~ oper materials or
equipment in construction of the work, the neglect or refusal of the Lessee to fakhfully perform the
work and all of the Lessee's obligations under thi,q Lease, or by or on account of any act or omission by
the Lessee or his agents or a subcontractor or his agents or a third party during the progress of the
work or at any time before its completion and final acceptance, or which might arise in connection with
the agreed upon work or is caused by or happening in connection with the progress of said work
15.2 The indemnification by the Lessee shall include all costs and expenditures including
attorney's fees incurred by the City of Tustin or its employees, officers, agents or independent
contractors with respect to such claim or suit and the Lessee will, if requested by the City, defend any
litigation arising out of such claims at the sole cost and expense of the Lessee. City shall have the fight
(18)
to select legal counsel of its choice in connection with such defense.
16. INS~CE
16.1 Without limiting Lessee's indemnification of City, Lessee shall provide and maintain at
its own expense during the term of this Lease the following program(s) of insurance covering ks
operations hereunder. Such inszmance shall be provided by insurer(s) licensed to do business in, and in
good standing in, the Sate of C21ifornia, with a Best's Key Rating of at least A VII, and satisfactory to
City's Risk Manager and the City Attorney. Evidence of such programq satisfactory to City shall be
delivered to the City on or before the effective date of this Lease. Such evidence shall specifically
identify this Lease and shall contain express conditions that City is to be given written notice at least
thirty (30) days in advance of any modification or termination of any program of insmauce. Such
insurance, w/th the .exception of Workers' Compensation insurance, shall be primary to and not
contributing with any other insurance maintained by City, and shall name the City and its officers and
en~loyees as additional insureds. The City ofTustin hsmance Endorsement Form, a copy of which is
attached as E~ E hereto and incorporated herein by reference,, must be executed by the applicable
insurance underwriters and delivered to City.
A. DmSng the term of this Lease, following completion of construction of tenant
improvements, Lessee shall provide and maintain the following forms and mounts of insurance:
1.. Liability: Comprehensive General Liability insurance endorsed for
independent Contractor, Premises-Operations, Products/Completed Operations, Contractual, Broad
Form Property Damage, and Personal Injury with a combined single limit of not less than ONE
5}[ILLION DO~ ($1,000,000.00) per occurrence.' If such insurance is written on a Claims Made
Form, such insurance shall be endorsed' to provide an extended reporting per/od of not less than five
years following termination of this Lease.
2. Workers Compensatiorr A program of Workers' Compensation
insurance in an amount and form to meet all applicable requirements of the Labor Code of the State of
California, including Employers' Liability with a $150,000 limit covering an persons providing services
by or on behalf of Lessee and all risks to such persons under this Lease.
3. Property_ Coverage.: (1) Real Property - All Risk insurance, including
flood, for the full insurable replacement value with a deductible no greater than five percent (5%) for all
risk related coverages, and (2) Personal Property Insurance for the actual cash value against the
hazards of fire, theft, burglary, vandalism and malicious mischief.
B. During the period(s) of construction of'tenant improvements as required
herein, Lessee shall provide the fonowing forms and amounts ofinsurauce:
1. · Builders All-Risk Insurance: including flood coverage, covering the
entire work, again~ loss or damage until completion and acceptance by the City Manager. Insurance
shall be in an amount for the replacement value of the impr. ovem~ and endorsed for broad form
property damage, breach of Warranty, explosion, collapse, and underground hazards. Deductibles not
(19)
exceeding five percent (5%) of the construction cost will be permitted.
2. 'Comprehensive General Liability: endorsed for all owned and non-
owned vehicles with a combined single limit of at least Three Hundred Thousand Dollars ($300,000)
per occurrence.
3. Workers' Compensation: a program of Workers' Compensation
insurance in an amount and form to meet ail applicable requirements of the Labor Code of the State of
California, including Employer's Liability with a $150,000 limit covering all persons providing services
by or on behalf of Lessee and all risks to such persons under this Lease.
16.2 Failure on the part of Lessee to procure or maintain iequired inmmnce shall constitute
a material breach of contract upon which City may immediately terminate this Lease.
16.3 Conduct of Lessee's operations shall not commence until Lessee has complied with the
aforementioned insurance requirements. Further, said operations, whether in whole or in part,, shall be
subject to suspension with City during any period that Lessee fails to maintain said policies in full force
and effect.
16.4 The specified amount of tiabilky insurance required herein may be subject to
renegotiation on an annual basis. Should either party request renegotiation with respect to the amount
of l/ability insurance to be provided, the determination thereof shall be established through mutual.
negotiations between the parties. Lessee shall continue to provide insurance in the manner heretofore
provided, pending final renegotiation thereof.
16.5 No cancellation provision in any insurance policy shall be construed in derogation of
the continuous duty of Lessee to fum/sh insurance during the term of this Lease. At least thirty (30)
days prior to the expiration of any such policy, a signed and complete certificate of insurance, with all
endorsements required by this section, showing that such insurance coverage has been renewed or-
extended shall be filed with the City.
17.0 TAXES AND ASSESSMENTS
17.1 Lessee shall also pay all taxes, assessments, fees .and. charges on goods, merchandise,
fixtures, appliances and equipment owned or used therein.
18.0 ASSIGNMENT, SUBLETTING, AND ENTERING
18.1 Prohibition of Ass(munent. The Parties acknowledge that City is entering into this
Lease in reliance upon the experience .and abilities of Lessee and its principals. Consequently, Lessee
shall not vohmm.rfly assign or enmmtx.~.its interest in this Lease or in the demised premises, or mblease
substantially all or any pan of the demised premises, or allow any other person or entity (except
Lessee's Authorized Representatives) to occupy or use all or any pan of the demised premises without
the prior written consent of City, which consent shall not be ~mreasonably withhelct Lessee shall not,
(20)
without the pr/or written consent of the City assign, hypothecate, or mortgage this Lease or sublease or
license any portion of the demised premises. Any attempted assignment, hypothecation, mortgage,
Sublease or liceme without the consent of the City shall render thi.q Lease null and void.
18.2 - Each and all of the provisions, agreements, terms, covenants and conditions herein
contained to be performed by Lessee shall be binding upon any transferee thereof.
18.3 The operations herein authorized shall not be transferable by testamentary disposition
or the state laws of intestate succession, as the rights, privileges, and use conferred by this Lease shall
terminate prior to the date for expiration thereof in the event of the death of LesSee occurring within
the term herein provided. Additionally, neither this Lease nor any interest therein shall be transferable
in proceedings in attachment or execution again~ Lessee or in voluntary or involmXary proceedings in
bankmptcy or insolvency or receivership taken by or again~ LeSsee, or by any process of law including
proceedings under all applicable federal bankruptcy laws.
18.4 Shareholders and/or partners of Lessee may transfer, sell, exchange, assign or divest
themselves of any interest they may have therein. However, in the event any such sale, transfer,
exchange, assi,~nment or divestment is affected in such a way as to give majority control of Lessee to
any persons, corporation, partnership or legal entity other than the majority controlling interest therein
at the time of execution of this Lease, approval thereof shall be required. Consent to any such transfer
shall only be refused if the City finds that the transferee is lacking in experience and/or financial ab'~-y
to render and provide services for the operation of the concession(s). Failure to obtain such consent
'shall constitute an event of default under Section 21.8 hereof.
..
18.5 The prohibition herein contained shall not be applicable with respect to transfers of this
i~e arising from the exercise of a power of sale or judicial forecloSUre purmant to the terms and
conditions of a hypothecation or mortgage previously approved by the City.
18.6 In reference to Section 18.5 hereinbefore, the City's consent with regard to successive
tran.qfers of Ihi.q Lease arising from the exercise of a power of sale or judicial foreclosure .or the
assi~ment of the Lease in lieu of foreclosure, pursuant to the terms of a deed of trust previously
approved by the City, shall not be unreasonably withhelc[
18.7 In the event Lessee shall request the prior written consent of City to give, assign,
transfer or grant control ofthi~ Lease, and subsequently City gives written consent to the assignment, a
trar~qfer fee equal to one percent (1%) of the gross sales price shall be paid to City. Said sum shall be
payable to City in full either within thirty (30) days after said consent is given or prior to the close of
any escrow, whichever occurs first.
19.0 NON-DISCRIMINATION AND CIVIL RIGHTS COMPL~CE
19.1 Lessee hereby certifies and agrees that, in ail matters affecting thi.q L~e, it will comply
with ail applicable federal and state hws and regulations pro~ discrimination.
19.2 Lessee certifies and agrees that all persons employed thereby, are and shall be treated
equally without regard to or because of race, creed, color, rational origin, political affiliation, marital
statu~, sex, age or handicaP and in compliance with ail federal and state laws prohibiting discrimination
in employment, including but not limited to, the Federal Civil Rights Act of 1964; the Unmh Civil
Rights Act; and Cartwright Act; the State Fair Employment Practices Art and Americans with
Disabilities Act.
19.3 Lessee certifies and agrees that subcontractors, bidders and vendors thereof are and
shall be selected without regard to or because of race, creed, color, national orig/n> political affiliation,
marital status, sex, age or handicap.
19.4 All employment records shall be open for.~on and reinspection at any reasonable
time during the term of this Lease for the purpose of verifying the practice of non-d/s~tion by
Lessee/n the areas heretofore descn~becl~
19:5 If City.finds that any of the above provisiom have been violated, the same shall
constitute a material breach of contract upon which City may determine to cancel, terminate, or
suspend this Lease. While City reserves the fight to determine independently that the non-
discrimination provisions ofthi.~ Lease have been violated, in addition, a determination by the California
Fair Employment and Housing DeparUnent or the Federal Equal Employment Opponunky
Commission that Lessee has violated State or Federal non-dis~fion laws or regulations shall
constitute a findingby City that Lessee has violated the non-discrimmtion provisions ofthi,~ Lease.
19.6 Lessee shall include the non-discrimination
subcontracts to perform work under the contract.
and compliance provisions
20.0 TERMINA~ON OF AGREEMENT
20.1 The abandonment, vacation or discontinuance of concession operations on the demised
premises for more than five (5) consecutive days. This does not include inclement weather or days that
the City has' given prior approval to be closed. If the City closes the park, it is deemed to be approval
to close. Upon the occurrence of any one or more of the eveats of default hereinatter descn.~l, this
Lease shah be subject to termination. As a condition precede~ thereof, the City Manager shall give
Lessee ten (10) days notice by registered or certified mail ofthe date set for termination hereof and the
grounds thereof.
20.2 Upon termimtion City shall have the right to take possession of the demised premises,
including all improvements, equipmem, and inventory located thereon, and use same for the purpose of
satisfying and/or ~tiga~g all damages arising fi'om a breach ofthi.q Lease.
20.3 Action by City to effectuate a tmnination and forfeiture of possession-shall be without
prejudice to the exercise of any other rights provided herein or by law to remedy a breach ofthi~ Lease.
(22)
21.0 EVENTS OF DEFAULT
21.1 The abandonment, vacation or discontinuance, of concession operations on the demi.qed
premises for more than 5 consecutive days. This does not include inclement weather or days that
the City has given approval ~o be cloSed.. If the City doses the park, it is deemed to be approval to
close.
21.2 The faikn'e of Lessee to punctually pay or make the payments herein when due, where
the delinquency continues beyond ten (10) days following written notice for payment thereof.
21.3 The f~e of Lessee to operate in the manner required by this Lease, where such
faiEu-e continues for more than thirty (30) days 'after written notice from the City to correct the
condition therein specified.
21.4 The faikn'e to maintain the demised pren~es and the impr~ ovements constructed
thereon in the state of repair required hereunder; and in a clean, sanitary, safe and satisfactory
condition, where such failure continues for more than thirty (30) days after written notice from the City
for correction thereof, provided that where fi]lfillment of such obligation requires activity over a period
of _time and Lessee shall have mediately, .following receipt of. such notice, commenced to perform
whatever may be required to cure the particular default and continues such performance diligently, said
_time limit may be waived in the manner and to the extent allowed by the City.
·
21.5 The failure of Lessee to keep, perform and observe any other promises, covenants,
conditions and agreements set forth in this Lease, where such failure continues for more than thirty
(30) days after written notice bom the City for correction thereof~ provided that where fi~lfillment of
Such obligation requires activity over a period of time and Lessee shall have commenced to peri'om
whatever may be required to cure the partimlar default within ten (10) days after such notice and
continues SUch performance diligently, said time limit may be waived in the manner and to the extent
allowed by the City Manager.
21.6 The filing of a vokmtary petition in bankru~cy by Lessee; the adjudication of Lessee as
a ban~; the appoinunent of any r~eiver or trustee of Lessee's assets; the making of a genera1
assignment for the benefit of creditors; a' petition or answer seeking an arrangement for the
reorgauimtion of Lessee under any federal reorganization act, inchdJng petitions or answers under
federal laws; the ocan'rence of any act which operates to deprive Lessee permaue~y of the rights,
powers and privileges necessary for the proper conduct and operation of the concession; the levy of
any attachment or execution which substantially interferes with Lessee's operations under this Lease
and which attachment or execution is not vacated, dismiss~ stayed or set aside within a period of
sixty (60) days; the City reasonably determines that the Lessee is insolvent; Lessee shall be deemed to
be insolvent if it has ceased to pay its debts in the ordinary course of business or cannot pay its debts as
they become due, whether it has committed an act of bankruptcy or not, .and whether insolvent within
the meaning of federal bankruptcy law or not.
21.7 Det~on by the City, the State Fair Employment Commission, or the Federal
Equal Emplo~ Oppo~ Commission of discrimimtion having been practiced by Lessee in
violation of state md/or federal laws in connec~on with the Lease..
(23)
~ 21.8 Transfer of the majority controlling interest of Lessee to persons other !hah those who
are in control at the time of the execution of this Lease, without approval thereof by the City Manager.
21.9 Lessee's material mi~epresentation of fact(s) in its literature, forms and/or affidavits,
which were subn~ed in response to the Request For Proposals used in the solicitation process for this
Lease.
21.10 Failure to have submitted schematic plan.~ and/or working drawings for tenant
impjovements on or before the date(s) designated in thi.q Lease for submi.~sion thereof.
21.11' F~e to have commenced required construction oftenant improvements or any phase
thereof on or before the date designated in thi.q Lease for commencement thereof.
21.12 Failure to have completed construction of tenant' improvements on or before the date
designated in thk Leasefor completion thereof.
22.0 WAIVER
22.1 Any waiver by City of any breach of any one or more of the covenants, conditions,
terms and agreements herein contained shall not be construed to be a waiver of any subsequent or
other breach ofthe same or of any other covenant, condition, term or agreement herein contained, nor
shall ~ure on the part of City to require exact, full and complete compliance with any of the
covenants, conditions, terms or agreements herein contained be construed as in any manner changing
the terms ofthi~ Lease or stoPPing City from enforcing the full provisions thereof.
22.2 No delay, failure, or omission of City to re-enter the derni.~ed premi.qes or to exercise
any right, power, privilege or option, arising from any default, nor any subsequent acceptance of
payments then or thereafter shall impair any such right, power, privilege or option, or be construed as a
waiver of or acquies~ce in tach default or as a relinqni.qhmem of any fight.
22.3 No notice to Lessee shall be required to restore or revive "_time ofthe essence" after the
waiver by Cily of any default.
22.4 No option, right, power, remedy or privilege of City shall be construed as being
exhausted by the exercise thereof in one or more instances. The rights, powers, optiom, privileges and
remedies given City by thi~ Lease shall be cum~la_tive.
23.0 RIGHT-OF-ENTRY
23.1 Should Lessee be deemed deficient, as determined bythe City, in its performance of its
obligations required hereunder,. City in addition to ail other available remedies may, lint shall not be so
obliged,, enter upon the demised premiss, a~ correct Lessee's deficiencies using City forces, and
(24)
equipmem and material~ on the demi.~ed pr~rni.qes suitable for such purposes,, or by employing a
separate private contractor. City's costs so incurred, including direct and indirect overhead costs as
determined by the City, shall be reimbursed to City by Lessee and/or its sureties within thirty (30) days
of denmnd thereof.
23.2 In the event of an abandonment, vacation or discontinuance of operations for a period
five (5) days, exclusive of inclement weather, approval of the City to be closed, or closure of the park
by the City, Lessee hereby irrevocably appoints City as an agent for continuing operation of the
s~ices granted herein, and in connection therewith authorizes the officers, employees, agents and
independent contractors thereof to (1) take possession of the demi.qed premises, including an
improvements, equipment and inventory thereon; (2) remove any and an persons or property on said
demi.qed prem[qes and place any such property in storage for the account of and at the expense of
Lessee; (3) sublease or Iiceme the demised premises; and (4) after payment of an expeme of such
subleasing or licensing apply an pa~s realized therefrom to the satisfaction and/or mitigation of an
damages arising from Lessee's 'breach of thi.q Lease. Entry by the officers, ex~loyees, agents or
independent contractors of City upon the demised premises for the purpose of exercising the authority
conferred hereon as agent of LesSee shall be without prejudice to the exercise of any other rights
provided h/rein or by law to remedy a breach of this Lease.
24.0 SUR.RENDER
24.1 Upon expiration of the term hereof, or termination thereof as herein provided, Lessee
shall peaceably vacate the demised premiss and shall remove an tenant improvements, equipment and
LX:rsonal property used in Lessee's operatiom. Notwithstan~g the foregoing, however, on. receipt of
written notice from City, delivered at City's option, LeSsee shall instead surrender the demi.~ed premi.~es
to City with all tc~ant improvements remaining in tact and shall deliver up the demi.~ed premi.~es and
the tenant impr~ ovm~, to the extent that City elects not to have Lessee remove the tenant
irnrrr, ovements. Title to the demi~qed premises and the tenant impr~ ovements remain~ vested in City,
pursuant to Section 1.6.
24.2 Upon expiration of the term of thi.q Lease, Lessee shaI1 at City's request, execute and
deliver to City within ~ (30) days after service of written demand, a good and sufficient quitclaim
deed of the Lessee's interest in thi.q Lease and the de~qed premises. Should Lessee fail or refuse to
deliver to City a quitclaim deed as aforesaid, a written notice by City reciting the fm~e of the Lessee
to execute and deliver the quitclaim deed, shall after ten (10) days from the date of recordation of the
notice be conclusive evidence against Lessee and all persons claiming under Lessee of the termination
of this Lease. ·
25.0' INTERPRETATION...
25.1 This ~ shall be interpreted according to the roles which govern the interpretation of
contracts, as pre~ in Title 2, of Part 2, of Division 3, of the California Civil Code, commencing
with Section 1635.
(25)
25.2 The headings herein contained are for convenience and reference only and are not
interkted to define or limit the scope of any provision thereof.
25.3 The following words as used herein shall be construed to have the following meaning,
unless otherwise apparent from the context in which they are used:
"City_" - The City of Tustin
"City Man~er" - City Manager or his designee.
"State"- The State of California
"Finance Director"- Finance Director of the City of Tustir~
'~Beverage'~ - Any liquid prepared by flavoring heating and/or .admixing in advance of
consu ~mption thereof; not including alcoholic beverages as defined in the State Alcoholic Beverage
Control Act.
"Gross Receipts" - Except as specifically provided by policy statement issued by the City, the
term "gross receipts" as used in this Leased is defined to be all money, cash receipts, collected or
accrued from the use granted within the demised premi.qes including the rendering or supplying of
services and the sale of goods, foods or beverages.
25.3.1 Except as. specific~y provided below or by policy statement issued by the City
..Manager, there shall be no deduction from gross-receipts for any overhead cost or expense of
operations, such as, but without limitation to salaries, wages, costs of goods, interest, debt
amortization, credit, collection costs, discount from credit card operations, insurance and taxes.
25.3.2 The City, by policy statement consistent with recognized and accepted business and
.accounting practices, upon consultation with Lessee, and with the approval ofthe Finance Director and
City Attorney, may further interpret the term "gross receipts" as used in this Lease.
25.4 In the event of any conflict in the definition or interpr~tion of any word,
respons~/lity, service or schedule between the body of this Lease and the Extn~ attached hereto, the
terms ofthe body ofthi.q Lease shall control
26.0 FORCE ~ EXTENSIONS
26.1 Except as otherwise specifi~y provided hereinbefore, mci in the event either party.
hereto shall be delayed or prevented from performance of any act required hereunder by reason of fire,
earthq~e, war, labor dispute, or other cause without fault and beyond control of the party obligated,
performance of such act shall be excused for the periOd of time of the delay as determined by the City
Manager. An extension of time for any'such cause shall only be for a period oftlme equivalent to the
forced delay. Lessee's inabK~ to obtain financing .qhall not be grounds for an extension of time. City
Manager shall prepare and exeo_wte, and Lessee. shall execaxte the appropriate document acknowledging
(26)
any extension of time granted pursuant to thi.~ section.
27.0 LESSEE'S NON-COMPLIANCE
27.1 If the City determines that there are deficiencies in Lessee's perform~ce of the
concession operations authorized and required herein, the City will provide, as specified in Section 20
(Default) herein, a written notice to the Lessee to correct said deficiencies within specified time frames,
except for the repair of leaking valves which must be corrected within twenty-four (24) hours
following notification
27.2 In the event that .Lessee fails to correct the deficiencies within 'the pres. m]xxt time
frames the City may, at its option; (1) use the Security Deposit as provided for herein, (2) exercise its
rights under paragraph 23 (Right-of-Entry) herein, and/or (3) terminate thi.q Lease.
28.0 NOTICES
Any notice required to be given under the terms of this Lease or any law applicable thereto
may be: (1) delivered by personal service; or (2) placed in a sealed envelope, with postage paid,
addressed to the person on whom it is to be seawed, return reccqpt requested, and deposited in a post
office, ~x, mb-post office, substation or mail chute, or other like fac'~,:y regularly maimained by
the United States Postal Service.
follows:
The address to be used for any notice served by mail upon Lessee .qhall be addressed as
LESSEE:
TO: Marcia Sanserino
'ITrl'.E: Owner
ADDRESS: 20 Kine, on
Ilvine, CA 92620
or attemate mailing location as may hereafter be designated in writing to the City by Lessee.'
Any notice served by mail-upon City shall be addressed to the City as follows:
crrY MANAGER
CITY OF TUSTIN
300 CENTENNIAL WAY
TUSTIN, CA 92680
PARKS AND RECREATION SERVICES
CITY OF TUSTIN
300 CENTENNIAL WAY
TUSTIN, CA 92680
Personal suwice shall be deemed complete on delivery and service by mail shall be deemed
complete upon receipt as reflected by the retmu receipt.
(27)
29.0 ~ SEVERABILITY
If any provision ofthk Lease is deterx~ed to be illegal, invalid, or unenforceable by a
court of competent jm/sdiction, the rernain~g provisions hereof shall not be affected thereby and shall
remain in full force and effect.
30.0 cONTRACT ENFORCEMENT AND AMENDMENTS TO THIS LEASE
30.1 The City Manager .qhall be responsble for the enforcement of this Lease on.behalf of
City and shall be assisted therein by those office~ and employees of City having duties in connection
with the aclmini,qtration thereof.
30.2 Any offica~ and/or authorized employees of City may enter upon the deml.qed prerni.qes
at any and all reasonable _times for the purpose of determining whether or not Lessee is complying with
the terms and conditions hereof, or for any other purpose inddental to the rights of City within the
demi.ged premiqes.
Lessee shall be notified with reasonable notice for the purpose of entry.
30.3 In the event either party commences legal proceedings for the enforcement of thi.~
Lease, the prevailing party shall be entitled to recover its attorney's fees and costs incttrred in the action
brought thereon_
30.4 This document may be modified only by fm-ther wrkten agreement between the parties.
Any such modification shall not be effec~e unless and until executed by Lessee and in the case of the
City, unless otherwise specifically authorized hereinbefore, until executed by the Mayor of the City.
31.0 ENTIRE AGREEMENT ·
31.1 This docttment, and the exh~its attached hereto, constitutes the entire.agreement
between the City and Lessee for operations and use granted herein. Ail other agreements, promises
and representations with respect thereto, other than contained herein, are expressly revoked.
(28)
~ IN WITNESS WHEREOF, the City has by action of City Council authorized this Lease to be
executed for and on behalf ofthe City ofTustin bythe Mayor, and the Lessee has caused the same to
be executed by its duly authorized officer.
CITY OF TUSTIN
Dated:
ATrEST:
Pamela Stoker
City Clerk
A[PPROVED AS TO FORM:
City Attorney
"LESSEE"
Dated:
'Title:
(29)
·
EXHIBIT A
TUSTIN SPORTS PARK SITE
o®~?oeO o e.
EXHIBIT B
CONCESSION BUILDING PLANS WITH
DEMARCATION OF DEMISED PREMISES
Z.
0
0
0
.D
EXHIBIT C
CAPITAL IMPROVEMENT PROGRAM
CAPITAL IMPROVEMENT PROGRAM
The proposed tenant improvements include making the current concession building
operable. All of the existing cabinets, lighting, fixtures and plumbing will stay as they exist.
Mom's will bring in equipment that is needed for the menu items offered, and will finish off the
counters so the3' are workable.
The time frame for these improvements will be as short 'as possible m order to open the
business as soon as possible. Keeping in mind there are always unforseen delays, an estimated
amount of time would be six w~ks in order to get the concession in working order. Business
would open as soon as possible after the work is completed.
The estimated budget for improvements would be:
EQUIPMENT
$10,500.00
~'im~N,t~NT IMPROVEMENTS $8,000.00
TOTAL $18,500.00
EXHIBIT D
PROPOSED PRICE LIST AND MENU
PROPOSED MENU AND PRICE LI ST
Hot Food
Homemade BBQ Beef
Baked Potato
with Chili
1/4 lb. Hamburger
with cheese
*BBQ on the patio
Bowl of Chili
Hot Dog
Corn Dog
1/4 lb Al! Beef Dog
Polish Sausage
~French Bread Pizza
Bean and Cheese Burrito
S andwi ch
for special
$4.O0
$3.O0
$3.50
53.50
$4.00
events
53.00
$1.75
$1.5o
52.50
$2.50
$2.25
$1.75
and busy days
Cold Food
Turkey Sandwich
Roast Beef Sandwich
Ham Sandwich
$3.50
$3,50
53.5o
Snacks
Nachos
Salsa and Chips
H~t Pretzel
Hot Churro
Chips
Qookies
String Cheese
Candy
Muffins
Croissants
$'1.50
Si.oo
5i.25
5i.50
$ .75
S .75
5 ..75
$ .05-.75
Si.25
$i.25
Ice Cream
Assorted Novelties
Frozen Yogurt
$ .75 - 1.25
$1.50 / 2.25
Cold Drinks
Pepsi-Cola
Diet Pepsi
7-Up
Sunkist 'Orange
Root Beer
Iced Tea
Lemonade
Sport Drinks
Bottled Water
Apple Juice
Orange Juice
$1.00 / $1.50
$1.75 /
$1.25
$i.oo
5i.oo
$2.50
Hot Drinks
Coffee $1.00
Hot Tea $1.00
Hot Chocolate $1.00
Cappuccino $2.50
Espresso $1.50
Cafe Latte $2.25
Cafe Mocha $2.75
Party Packaqe
Package includes main~food item, chips, refillable drinks, and
ice cream or candy, it also includes the use of tables and
chairs which are reserved on the patio for the party. There is a
minimum of 10 people.
Above items w~n Hot dog $4.25 per person
Pizza $4.75
Corn Dog $4.25
Sandwich $5..50
Hamburger $5.50
Seam Snack Card
Team snack card can be purchased for 12 snacks (either candy, ice
c~eam,, chips or pretzel) and drink. This also includes a free
~rink for the coach!
Price- $15.00
(NOTE: this card would be changed to accommodate the size of
team in season)
FINANCIAL STATEMENT
This financial statement and income statement is a balance sheet showing assets,
liabilities and sources of income. Because of the confidential nature of specific account
numbers and contents, that was withheld until requested at a later time. All assets and
credit histories can be verified through reputable banks and financial institutions.
The funds to finance 'Mom's Sport Cafe' will not be borrowed, but taken from
existing assets.
FINANCIAL STA TEll/IENT AND INCOME STA TEMEIVT
For Marcia and Gary Sanserino
20 Rincon
Irvine, Ca. 92620
&SSETS
~Oash on Hand $ 8,000
U.S. Government Securities $ 10,500
Cash Value- Life Insurance $ 19,500
Stocks and Securities $ 108,500
Real Estate $ 560,000
Automobile $ 9,000
=ersonal property $ 75,000
Other Collectibles (art, coins, etc.) $ 17,000
401 K $ 229,500
TotalAssets $ 1,037,000
LIABILITIES
Mortgage $ 332,000
Other
Total Liabilities
~
$332,000
Net Worth $ 705,000
SOURCE OF INCOME
I
Salary , $ 87,000
Dividends and Interest ~ $ 2,000 ,
Bonus and Commissions $ 83,000
Other ~$ - '
Total Income $ 172,000
CASH FLOW ANALYSIS AND PROFORMA
CASH FLOW ANALYSIS I i I
1999! 2000i 20011 2002! 2005'
Food and beverage I $ 38,000 I $ 49,400 i $ 64,220 I $ 80,275 I $100,343
Special Events 15 500 i$ 1,000i$ 2,00015 2,500 i$ 3,000
Misc. !$ -!$ -15 -!$ -i$ -
TOTAL REVENUE $ 38,500 15 50,400 I$ 66,220 i $ 82,775 i$103,343
COST OF SALES '. .i i i ,i
Food,! $. 11,666 I $13,415 j$ 15,428 i $ 17,742 ; $ 20,403
Paper Supplies iS 2,500 !$ 2,750 iS 3,025 !$ 3,327 !$ 3,659
Misc. iS 1,200!$ 1,200i$ 1,200i$ 1,200 !$ 1,200
I
TOTAL COSTS iS 15,366 $17,365 iS 19,653 '~$22,269 ;$ 25,262
GROSS PROFIT '~ $ 23,134 i $ 33,035 ] $ 46,567 i $ 60,506 i $ 78;081
EXPENSES ! I ! i ~
! ,
Salary Expense I$ 6,000i$ 6,60015 7,260i$ 7,986 I$ 8,784
Empl.yment Develop. I$ 300!$ 33015 363 !$ 398 iS 438
RS . $ 2,000 !$ 2,200{$ 2,420 IS 2,662 {$ 2,928
StateBd. of Equal. i$ 1,200 I$ 1,320,$ 1,452I$ 1,597 I$ 1,756
Equipment I$10,500I. $' 1,000 I$ 500 I$ 500 ! $ 500
Insurance iS 2,000 IS 2,200 I$ 2,420I $ 2,662 iS 2,928
iS 500
Advertising I$ 500 !$ 50015 50015 500 ,
Stationery I$ 500 I$ 100 I$ 100 15 100. $ 100
Health Department I$ 800 I$ 88015 968I $ 1,064 15 1,170
Maintenance/Tenant improvements !$ 8,000 I$ 1,000 I$ 1,000 i$ 1,000 I $ 1,000
Accounting !$ 900 iS 990i$ 1,000I$ 1,00015 1,100
Telephone/Utilities I$ 1,825 I$ 1,825 I$ 1,825 I$ 1,825 iS 1,825
IRent I$ 2,65015 3,840i$ 5,422 $ 6,756 iS 7,962
Permits iS 350!$ 350!$ 350 $ 350!$ 350
WoW, man's Comp t$ 500 I$ 550 !$ 605 $ 665 I$ 732
Bank Charges iS 350!$ 350!$ 35015 350 I$ 350
Fundraising I$ 3,040 i$ 3,95215 5,13715 6,42215 8,027
Misc. !$ 100 !$ 100I$ 100 i$ 100 15 100
TOTAL EXPENSES !$ 41,515 iS 28,087 I.$ 31,772 I $ 35,937 i $ 40,550
TOTAL OPERATING COSTS I $ 56,881 i $ 45.452 $ 51,425, $ 58,206 1 $ 65,812
~ET PROFIT i $(18,381)1 $ 4,948 $14,795 !$ 24,569 t $ 37,531
EXHIBIT E
CERTIFICATE OF INSURANCE
BMR INSURANCE AGENCY
September 21,1998
MOM'S SPORTS CAFE
20 Rincon
Irvine,-CA. 92620
Insurance Agents and Brokers
Lic. # OC17392
Attn: MARSHA
INSURANCE PROPOSAL
for
MOM'S SPORTS CAFE
12850 Robinson Drive
Tustin, CA. 92680
We are pleased to offer the following premium quotation:
COMPANY: FIRST FINANCIAL INSURANCE CO.
(Rated A+ by A.M. Best)
PROPERTY
INSURED:
Contents: $100,000
90% Co-Insurance
PERILS'
Special Form
.VALUATION: Actual Cash Value
EXCLUSIONS: Flood, Replacement Cost, Earthquake
DEDUCTIBLE: $1,000 per claim
COVERAGE:
General Aggregate Limit
Products-Completed Operations
Aggregate
Personal and Advertising Injury Limit
Each .Occurrence Limit
Fire Damage Limit (Any One Fire)
Medical Expense
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$ 5O,OOO
$ 5,OOO
"~'.. Member of CAM Insurance Se,q/ices
13732 Newoort Avenue.:.Suit,=
BMR
BMR INSURANCE AGENCY
Insurance Agent~ and Brokers
Lic. # OC17392
ADDITIONAL INSURED: (1) Fully Earned Premium of $50.00
EXCLUSIONS: Pollution, Punitive Damages, Asbestos, Lead Based
Paint, Employment Related Practices, Assault &
Battery, Liquor Liability
DEDUCTIBLE: $250.00 Per Claim ( including Loss Adjustment
Expense
PREMIUM:
$2,28O.OO
75.00 Company Fully Earned Policy Fee
$2.355.00 Annual Premium
CONDITIONS: Must have a dry chemical system installed over
cooking area. Please confirm type of system.
Replacement Cost is NOT available on Contents
WARRANT Central Station Burglar Alarm installed
and working.
We would need an original signed application along with a'deposit ·
premium to bind. Total annual premium or financing subject to a
finance charge are the payment options available.
The coverage descriptions in this proposal are simplified illustrations
only and do not alter, extend or restrict the insurance contract
described.
Await your instructions to proceed further.
Sincerely,
Georgia Huff
Member of CAM Insurance Services
1,q7~2 Newport Avenue. Suite 6. P.O. Bo× 10:~5. Tustin, CA 92781 f714~ 838-1912 · FAX: (714~ 838-7568
XHIBIT B
AMENDMENT NO. 1 T LEA E AGREEMENT
RE MOM'S SPORTS CAFE
This Amendment No. 1 dated for purposes of identification this 1st day of April,
2000, is made and entered into between the City of Tustin, a municipal corporation
(hereinafter referred to as "City"), and Marcia Sanserino, doing business as Mom's
Sports Caf6 (hereinafter referred to as "Lessee").
RECITALS
A. The City entered into a Lease Agreement with Lessee dated January 19,
1999, for portions of the Sports Park located at 12850 Robinson Drive for Lessee to
operate a food/beverage concession consistent with public park and recreation
purposes (the "Lease Agreement'.').
B. Section 3.1 of the Lease Agreement requires Lessee to pay a minimum
monthly rent in the amount of Three Hundred Dollars ($300.00) per month for the first
year, Four Hundred Dollars ($400.00) for the second year subject to fair market rent
rate adjustments for the third year through the fifth year of the five-year term of the
Lease Agreement.
C. The business is experiencing difficulties covering its costs and making
.inCreased rent payments that threaten its closure, and Lessee desires relief from
minimum monthly.rent increases.
D. Section 3.2 of the Lease Agreement further requires Lessee to pay the
City ten percent (10%) of the gross sales over Three Thousand Dollars ($3000.00) per
month generated by the operation of the business that may generate income to the City
unless the business seizes to operate.
E. The City wishes that the business continue to operate and
services consistent with public park and recreation purposes.
provide
F. Lessee has changed address and 'a new address should be provided for
noticing purposes.
Now, therefore, in consideration of the mutual covenants,
conditions set froth herein, the City and Lessee agree as follows'
promises, and
AGREEMENT
.
Amendment to Section 3.1 of the Lease Agreement pertaining to Renl.
Effective April 1, 2000, Section 3.1 of the Lease Agreement is hereby amen~ded
to read as follows: Lessee shall pay City Three Hundred dollars ($300.00) per month
as minimum monthly rent for the term of the Lease Agreement, except during the month
of December of each year, when the business will be closed and no rent shall be due.
119192\1 I of 2
Rent.
.
Effective April 1, 2000, Section 3.2 of the Lease Agreement is hereby deleted
and Lessee shall not be required to pay Percentage Rent.
3.
·
Effective April 1, 2000, the address to be used for any notice as provided in
Secti°n 28 of the Lease Agreement served by mail upon Lessee shall be addressed as
follows:
Marcia Sanserino
22351 Eagle Rock Way
Laguna Beach, CA 92651
4. All Other Provisions of the Lease Agreement Remain in Effecl.
All provisions of the Lease Agreement not specifically modified herein shall
remain in full force and effect.
IN. WITNESS WHEREOF, the parties have executed this Amendment No. 1~'io
the Lease Agreement as of the dates stated below. '
CiTY OF TUSTIN'
Je~~./l'~o~as; May~r
Attest:
Pamela Stoker
City Clerk
LESSEE:
Marcia .Sanserino
Owner
Dated: ,5--/5"-
Approved as to form:
Lois E. Jeffrey
City Attorney
Dated:
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