HomeMy WebLinkAbout14 FOOD CONCESS TSP 10-16-95NO. 14
10-16-95
DATE:
OCTOBER 16, 1995
Inter-Com
/O: WILLIAMA. HUSTON, CITY MANAGER
FROM: COMMUNITY DEVELOPMENT/COMMUNITY SERVICES
SOBJEC~ APPROVAL OF LEASE AGREEMENT FOR FOOD AND BEVERAGE CONCESSION
AT TUSTIN SPORTS PARK
RECOMMENDATION
It is recommended that the City Council approve the Lease Agreement
with Michele Insko for operation of a tenant lease space at the
Tustin Sports Park for purpose of operating a food beverage
concession.
FISCAL IMPACT
The City will realize a minimum annual rent for the food concession
of $12,000, adjusted annually based on the consumer price index.
In addition, the C£ty will receive a percentage rent on gross sales
equal to ten percent (10%) of gross sales to the extent that gross
sales exceed one quarter (~) of the minimum annual rent.
BACKGROUND
The soon to be opened Tustin Sports Park has been designed to'
accommodate two concession tenant spaces: a-food and beverage
concession and tennis concession.
The City Council originally approved a Request for Proposals (RFP)
for Food and Tennis Concessions at the Tustin Sports Park in
NOvember 1994. There were no responses to the original combined
proposal. The City subsequently reissued the Food and Tennis
Concession RFP as separate documents in April 1995. The City
advertised for proposals and also. sent 'information to all vendors
who had originally requested material.
Michelle Insko was the only firm to submit a proposal to operate
the food and beverage concession. Ms. Insko currently owns and
operates Cyrano'.s Coffee House in the City of 0range. Staff
conducted a background check on the credit: history and
qualifications of Cyrano's and found that' the. proposed
concessionaire has an excellent credit rating. Staff also visited
City Council Report
Approval of Lease Agreement for
Food and Beverage Concession
at Tustin Sports Park
October 16, 1995
Page. 2
the current business site in Orange and found Cyrano's to 'be' a
professionally run operation.
The proposed agreement requires a monthly base rent of $1,000 plus
an additional percentage rent equal~ to ten percent (10%) of gross
sales which exceed one quarter (~) of the minimum annual rent. In
the first year, this percentage rent would not be triggered until
sales of $3,000 had occurred.
The following is a .summary of other important elements of the
agreement:
The food concession must be operated at least 30 hours per
week. The actual schedule setting forth hours and days of
operation is subject to City approval.
The lessee must maintain necessary food and beverage products
required to satisfy the public demand. All prices must be
fair and reasonable and the City may request price adjustments
to achieve this.
Lessee will have the exclusive right to conduct food and
beverage business at the'Sports Park, with the exception that
the City may permit commercial picnic operators or caterers to
operate at the picnic shelter or to cater public events
sponsored anywhere on the site by the City of Tustin. Lessee
will also agree to permit sale of food and beverage.sales for
not to exceed 14 days per year for non-profit groups when
approved by the City.
Lessee shall be responsible for maintenance of their own
tenant space and those plaza sidewalk areas immediately
adjacent to their tenant space.
Lessee is responsible for installing all needed tenant
improvements which must be of a high quality, subject to
City's approval.
Lessee is responsible for a one month security deposit,
faithful performance bond or its equivalent, as well as
insurance for comprehensive liability, proPerty coverage,
workers· compensation and builder's risk (in the amounts
indicated in the Agreement). Lessee is also responsible for
indemnifying and holding City and its employees harmless
City Council Report
Approval of Lease Agreement for
Food and Beverage Concession-
at Tustin Sports Park
October 16, 1995
Page 3
against any claims, injuries or 'losses resulting from
construction or tenant operations.
Staff will be available at the October 10th meeting to respond to
any questions.
Christine A~
Assistant City Manager
Community Development Director
ity
Services
CAS: kbm\tspcon, cas
LEASE AGREEMENT
THIS LEASE is made. and entered into on this day of
,
1995, by and between the CITY OF TUSTIN, hereinafter referred to as "CITY" and MICHELE
INSKO hereinafter referred to as "LESSEE";
RECITALS
Ae
The City is the owner of the 20 Acre Tustin Sports Park site, located at 12850
Robinson Drive and depicted on Exhibit A attached hereto and incorporated herein by
reference, and is currently constructing an active sports park; and
Bo
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
Ce .
City desires to lease tenant space at the Tustin Sports Park property for the.purpose of
operating a food/beverage concession; and
D. - City desires to lease portions of the Sports Park site for such purposes in accordance
with the terms and conditions set 'forth in this Lease.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants, promises and conditions set
forth herein hereinafter 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 consists of a concession lease space of approximately one thousand
(1,000) square feet for food and beverage concession, together with certain structures, buildings
and/or improvements (collectively the "demised premises"). The concession building plans are
shown on Exhibit 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 Exhibit Bi The demised premises (specifically including the structures, buildings and/or
improvements thereon) shall be surrendered to the City upon termination 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 designee', and for no other purpose whatsoever.
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1.3 Lessee acknowledges personal inspection of the proposed park, as depicted on
EXhibit A, and concession improvements under construction by City, as depicted on EXhibit
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 physigal, condition as shown on construction plans and agrees to make no
demands upon the 'City for any improvements or alteration thereof.
1.4 Lessee shall 'construct upon the demised premises the required tenant
improvements in accordance with the provisions set forth in Section 8 hereinafter and the
attached Exhibit 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 subject to: prior approval by the City Manager or designee;, securing of
applicable permits; and compliance with such terms and conditions as may.be imposed 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 demi~xl premises and the improvements located
thereon, and covenants and agrees never to assail; eontest'or resist said title.
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.
2.0 TERM
2.1 The term of this-Lease shall be for a period of five (5) years commencing on the
first day of the calendar month succeeding a thirty (30) days notice to proceed being issued
to the Lessee.
2.2 In the event Lessee holds over beyond the term herein provided with the consent
express Or implied 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 this Lease and
shall be at the monthly compensation provided herein.
2.3 Lessee may apply for an extension of the term of this Lease for up to one
successive term of five (5) years; 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. City shall approve the grant of an extension of this Lease if lessee is in good faith
compliance with terms of the lease and has received satisfactory perform ~ag. ce evaluations from
the City but City shall have the exclusive discretion and right as a condition of approving said
extension to renegotiate the terms of this Lease, including but not limited to'basic service
obligations, minimum concession payments, and required tenant improvements. Said
negotiation should consider market considerations such as similar comparable market rents of
similar concession operations in the Southern California area: Lessee's option to extend this
Lease shall be-denied based on any of the following factors:
1. Lessee is not 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 this Lease;
ge
e
Lessee is in default under this Lease;
Lessee has not abandoned, vacated or discontinued operations for a
period in excess of 7 consecutive working days; and
5. Lessee has not received satisfactory performance evaluations from City.
3.0 RENT
3.1 From and after the lease commencement date, Lessee shall pay to City a
minimum annual rent for the food and beverage concession of $12,000 (the "Minimum Annual
Rent"). One twelfth (1/12th) of the Minimum Annual Rent shall be payable>monthly in
advance on the first day of each month of the term. From and after the expiration of the first
full year of the-initial-term, City will, every year on the anniversary of the lease
commencement date, notify Lessee-of an adjustment in the Minimum Annual Rent. The
adjustment shall be measured by the Minimum Annual Rent for the first full year of the initial
term times the lesser of (a) the increase in the consumer price index for All Urban Consumers,
All Items, base year 1982-1984 = 100, for the Los Angeles/Anaheim/Riverside geographical
area as compiled by the United States Department of Labor for the immediately preceding year,
or (b) four percent (4%).
3.2 Percentage Rent.
In addition to the Minimum Annual Rent, Lessee shall, on a quarterly basis, pay
· Percentage Rent on gross sales equal to ten percent ( 10 %) of Gross Sales at.the concession,
to the extent that Gross Sales for the quarter exceed one-quarter (1/4th) of the Minimum
Annual Rent ($I2,000). Said Percentage Rent shall become due and payable'quarterly on the
twenty-fifth (25th) day of the month immediately following the end of the first quarter during
which Gross Sales at either concession exceeded one-quarter (l/4th) of the Minimum Annual
Rent; thereafter, Percentage Rent shall be paid quarterly on all additional Gross Sales made
during the remainder of the Lease term.
The City's acceptance 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 review the adequacy of such paymeht as hereinabove set
forth.
3.3 Gross Sales.
(a) The term "Gross Sales" ~as used herein shall mean:
(!) The entire amount of the actual sales price, whether wholesale oi'
retail, and whether Wholly or partly for cash or on creditor in exchange for any other product,
commodity, service, commercial paper or forbearance, of all 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.'
(2) All other receipts of all business conducted in, at or frOm the
demised premises, including all deposits not refunded to purchasers, proceeds, receipts or any
revenue derived whatsoever from the use of demised premises (i.e. rental, repair or cleaning
of tennis equipment, tennis reservation fees, tournament fees, fees for lessons, etc.).
(3) Orders taken in or from the demised premises although said orders
may be filled elsewhere, and Sales by any subtenant in or from the demised premises, and all
without credit to Tenant for uncollected or uncollectible credit accounts.
(4) Gross receipts of all coin-operated devices which may be placed
in the demised premises by Tenant or under any rent coneessi0n, percentage or other
arrangement including, without limitation, such devices as pinball machines, vending machines,
video games and similar devices (b~ut excluding revenue from telephones that are collected by
a public and/or'private utility), except that nothing herein shall be construed ~ City's consent
to the use of same in the demised premises; and
(5)
of the demised premises.
All other revenues or receipts generated by or arising from the use
(b) Exclusions .frOm Gross Sales. Notwithstanding anything 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 luxury taxes, consumers' excise
taxes, gross receipts taxes, and other similar taxes now or in the future imposed on the sale of
merchandise or services, but only if such taxes are added to the selling price and collected from.
customers.
(2) The 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 consununating a prior sale made in, to or from the demised premises or for the
purpose of depriving City of the benefit of a sale which otherwise would be made in, at or
from the demised premises.
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(3) The amount of returns to shippers or manufacturers.
(4) The amount of any cash or credit refund made upon any sale
where the merchandise sold or some part thereof is thereafter returned by the purchaser. Each
sale upon installment or credit shall be treated as a sale for. the full price in the month during
which such sale shall be made, irrespective of the time when Tenant shall receive payment
(whether in full or partial) from its customers.
(5) Sales of trade fixtures or personal property to be replaced by
Tenant which are not stock in trade.
(6)
or damage to merchandise.
Sums and credits received in the settlement of claims for' loss of
(7) Gift certificates, or similar vouchers,, until such time as they shall
have been converted into a sale by redemption.
(8) Meals provided for officers or employees without charge.
(9)
purposes without charge.
Meals, goods or products provided for promotional or publicity
(10) Cash refunds made to customers in the ordinary course of business.
(11) Value added taxes ("VAT") or other taxes added to the selling
price of products and other similar taxes now or hereafter imposed upon the sale .of
merchandise or services, whether such taxes are added to the selling price or included therein.
(12) Discounted sales to employees of Tenant, not to exceed 2% of
Gross-Sales.
(c) Statements 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 to the Finance Director at 300 Centennial Way, Tustin,
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 nb event, however,
shall any such late charges exceed the maximum amount permitted by law. Any returned
checks will be assessed the maximum .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 RECORDS
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 all cases have locked-in sales totals and
transactions counters which are constantly accumulating 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 imprinted. 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 all collections, and issue a sequentially pre-numbered customer's
receipt in like-manner.
4.2 Lessee shall be required to maintain a method of accounting, to the satisfaction
of the City, which correctly and accurately reflects the gross receipts and disbursements related
to tenant improvements and maintenance 'costs of the Lessee in connection with each type of
authorized operations (food and beverage concession).' The me-thod of accounting, including
'bank accounts established for said operations, shall be separate from 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.
Regular books of accounting such as general ledgers.
be
Journals including any supportihg and underlying docUments such as vouchers,
checks, tickets, bank statements, etc.
C.
State and Federal income tax returns and California sales and use returns and
checks and other documents providing payment of sums shown.
de
Cash register tapes (daily tapes may be separate but shall be retained so that
from day to day the sales can be identified).~
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Any other 'accounting records that the Finance Director or City Manager deems
necessary for proper reporting of receipts.
4.3 All documents, books and accounting records shall 'be open for inspection and
reinspection at any reasonable time during the term of this Lease and for four (4) years
thereafter. In addition, the City may from. time to time conduct an audit and reaudit of the
books and business so that accuracy of the above records can be confirmed. All information
obtained in connection 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 inspection.
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 receipts in connection with its
operations authorized herein, an actual loss and/or projected loss of rexi6nue to City can be
determined, the City, at its option shall: (1) bill Lessee for said losses, said amount to be paid
to City within thirty (30) days following billing therefore unless otherwise extended by the City
Manager, and/or (2) use the Security Deposit as provided for herein; and/or (3) terminate this
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 payments.
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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 made as proVided herein. The monthly reporting period shall be by Calendar
month, rather, than monthly an~.'versary date of the effective date of this Lease. In addition
thereto, Lessee shall furnish the City 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 after the
close of the Lease year. Said closing date shall be' determined by reference to the date for
commencement of the term herein provided.
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5.0
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 Exhibit D and incorporated herein by reference. To the extent of any
conflict between the provisions of the proposal and the provisions of this Lease, the proxdsions
of this Lease shall control.
B. Lessee's Staff
Lessee shall file'with the City a certificate for each member of its food
and beverage staff showing that within the last two (2) years such' person has. been examined
and has been found to be free of communicable tuberculosis. "Certific~ate" means a document
signed by the examining physician and surgeon who is licensed under Chapter 5 (commencing
· with Section 2000), Division 2 of the California Business and Professions Code, or a note from
a public health agency,-or unit of the Tuberculosis Association, which indicates free from
active tuberculosis. -
Lessee shall be responsible for hiring the necessary personnel to conduct
operations. Lessee shall comply with all federal, state and local laws relating to minimum
wage, social security, civil rights, ADA, unemployment compensation 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 open the food concession for business at least 30 hours, per
week as the City deems necessary to serve the public demand. Lessee shall submit for City's
approval, a schedUle setting forth hours and days-of operation for the business subject to
written approval of the City Community Services Director. Said schedule shall be' submitted
10 days after the City of Tustin issues a notice to proceed. Any curtailment or decrease of the
approved schedule shall be subject to the prior written approval of the Community Services
Department. The above days and hours of operation shall be complied with unless advance
written authorization to deviate from'this schedule has.been obtained from the City Manager
or his designee.
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,
misbranded 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 the
Community Services Director ~o be less that 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. In connection herewith, the proposed
adjacent tennis concession business shall not be permitted to sell any food or beverage items
from their proposed demised premises. However, the foregoing shall not preclude-the City
from permitting commercial picnic operators or caterers to operate from the picnic shelter on
the Sports Park site or for catering of public events sponsored by the City of Tustin. The
Lessee also agrees to permit food and beverage sales on the Sports Park for not to exceed 14
days. per year for non-profit groups, when such sales are approved in writing by the City
Community Services Director.
6.0 MAINTENANCE
6.1 Building, Equipment and Grounds Maintenance
A. Lessee shall, at its cost and expense during the term of this Lease, keep and
maintain the demised premises and all improvements, fixtures, trade fixtures, equipment and
utility systems which may now or hereafter exist thereon, in good, operable, useable and
sanitary order and repair and in a good, safe 'and first-class condition throughout the term of
this 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 facilities shall have the approval of the City prior to their
implementation.
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 fight-of-entry as provided hereinafter 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.
C. In regard to the level of maintenance, all work shall be performed in
accordance with 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 additional
maintenance areas shown, in Exhibit F 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 forwarded to Lessee upon request.
E. In re. gard_ to emergency services, the Lessee will provide the City with the
names and telephone numbers of at least two (2) qualified persons who can be called by City
representatives when emergency maintenance conditions occur during 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 furnish all necessary.' equipment,
supplies and material of good quality and in sufficient number to fulfill the requirements of this
Lease and to accomplish an acceptable and professional level of maintenance.
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G.' City shall be responsible for the maintenance and repair of the exterior
of all concession structures, except to the extent that City finds that Lessee is responsible for
damage to the exterior of a concession structure and as further stipulated herein. In that case,
City shall have the option of either requiring Lessee to repair the damage, or repairing the
damage .itself, at Lessee's expense.
In addition to the demised premise~, Lessee shaH"be responsible for
ensuring that those plaza sidewalk, and concrete areas and exterior areas adjacent to the
demised premises as shown on Exhibit F are cleaned daily or as needed including walls,
,
windows and opening ledges, walkways to the extent soiled by food products and patrons and
customers of lessee. Concrete areas showin in Exhibit F shall also be hosed down at least once
per week or as needed and shall be pressure washed (under supervision of City) as necessary
to keep concrete clean and free of foreign objects such as gum, etc.
6.2 Operation of Demised Premises. Lessee shall operate and manage 'the demised
premises in a first-class manner, comparable t° 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 county ordinances, and all
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state and federal laws and regulations, insofar as the same or any of them are applicable; and
where permits and/or licenses are required for the food and beverage and/or tennis operation
hereunder and/or any construction authorized herein, the same must be first obtained from 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
Council and 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 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 Si.mas
Lessee shall not post signs upon the demised premises or improvements thereon,
unless prior written approval therefor is obtained from the Community Development Director.
7.6 Lessee's Staff and 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 ii/terest 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 assignment at the demised premises
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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 circumstances to
assure the City that the conduct and activities 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 furnished 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 with 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 and regulations.
Lessee shall obtain, from all covered employees performing services hereunder, all verification
and other documentation of employment eligibility status required by federal and state statutes
and regulations as they currently exist and as they may be hereafter amended. Lessee shall
retain such documentation for all covered employees for the period prescribed by law. Lessee
shall indemnify, defend, and hold harmless, the City, its officers and employees from emPloyer
sanctions and any other liability which may be assessed against Lessee or City or both in
connection with any alleged violation of federal and/or state statutes or regulations pertaining
-to the eligibility for employment of persons performing services under this Lease.
7.7 Utilities
A. Lessee shall make all arrangements for and pay for all applicable utilities
furnish~ to' or used on the demised premises including without limitation:, gas, electricity,
water, refuse removal, telephone service, Cable TV, etc. In addition, upon expiration or earlier.
termination of any preexisting 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 claims against City for compensation for loss
or damage caused by a defect, deficiency or impairment of any utilities system, water system,
water supply system, drainage system, waste system, heating or gas system, electrical apparatus
or wires serving the demised premises.
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 rates
no greater than the standard rate charged other commercial users for City rubbish removal
services. No offensive' matter or refuse or substance constituting an unnecessary, unreasonable,
or unlawful fire hazard, or material detrimental to the public health shall be permitted to remain
on the demised premises and Lessee shall prevent any accumulation t.her_~of from occurring.
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7.9 Security Devices
Lessee may provide any legal devices, mechanisms or equipment designed for
the purpose of protecting the demised premises from theft, burglary or vandalism, provided
written approval for installation thereof is first obtained fi.om the City. All purchases and
installation thereof Shall be at Lessee's expense. During the last thirty (30) days preceding the
termination of this Lease, Lessee shall remove same fi.om the demised .premises, except for
those items of personalty which have been furnished by City or have been so affixed that their
removal therefi.om cannot be accomplished-without damage to the realty as determined by the
City.
7.10 Prices
Lessee shall at all times maintain a complete list or schedule of the prices
charged for all goods and services, or combinations thereof, supplied to the public on or fi.om
the demised premises. 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; comparability with prices charged for
similar goods and/or services supplied in the Orange County area; and reasonableness of profit
margin in view of the cost of providing same in compliance with the obligations assumed in
this Lease. In the event the City notifies Lessee that theprices 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 consultation thereon, Lessee shall make such price
adjustments as may be ordered by the City. Lessee may appeal the determination 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 fmal ruling thereon by
the City Council.
7.11 Safety
Lessee shall immediately correct .any unsafe Condition of the demised premises,
as well as any unsafe, practices occurring thereon. Lessee shall obtain emergency medical care
forany employee who is in need thereof, because of illness, or injury occurring 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 or
designee.
7.12 Quality of Goods and Services
Services to the public, with goods and merchandise of the best quality and at
reasonable charges, is of prime concern to City and is considered a part of the consideration
for this 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 serviceat 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 without discrimination.
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Lessee, following receipt 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 Repo.rting
.
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 determined by the
City.
7.14 Trade Fixtures
Lessee at its own expense shall provide and install-all appliances, furniture,
fixtures, equipment, door locks and padlocks or personal property that are required for the
operation of the demised premises. During 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 for any cost, as determined bY the City
Manager, incurred in excess of any consideration received from such sale, removal or
demolition.
7.15 Habitation
The demised premises shall not be used for human habitation.
7.16 NuiSances and Annoyances
·
·
~ ~.'~.. Lessee shall not use or permit the use of the demised premises in any manner
which creates 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.
&0 REQUIRED 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 improvements proposed by Lessee in
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order to operate said concession, the estimated improvement costs, and the projected time
frame for commencement and completion of the tenant improvement project. It is understood
that the construction and/or improvements 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 provisions of paragraph 8.4.
8.2 City and Lessee may agree from time to time .that various additional tenant
improvement(s) mutually agreed upon, shall be completed as necessary 'to improve and/or
ensure the useability of the demised premises.
8.3 Prior to commencement of construction, Lessee shall obtain City's written
approval of all plans, specifications and construction cost estimates by Lessee for the tenant
improvements to be constructed upon. the demised premises. No modification .of said plans,
specifications, or tenant improvements, 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 demised premises
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 fault 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 construct, perform, complete and maintain all. construction and
installations covered by this Lease in a good and workmanlike manner and with high quality
materials, and shall' furnish all tools, equipment, labor and material-necessary to perform and
to complete same. Upon completion.of the tenant improvements, Lessee shall furnish the City
with one (1) complete set of as-built construction drawings on mylar, 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 manuals for
building equipment and systems; and copies of all written warranties. Upon termination of this
Lease whether by expiration of term or cancellation, Lessee shall assign to City all express
warranties furnished by other persons in connection with the provision of labor and/or material
to the works of improvement 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
Lessee shall not promulgate nor caused to be distributed any advertising, or promotional
materials unless prior approval thereof is Obtained from City. Said approval shall not be
unreasonably withheld or delayed and shall be deemed to be given if n.o, .objection is made
within fifteen (15) business days following the request for approval. Sui:h materials include,
but are not limited to: advertising in newspapers, magazines and trade journals, and radio
and/or television commercials.
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Lessee may, at its own expense, place such signs in or upon the demised premises as
it maydeem necessary subject to compliance with Sections 8600 et seq. and 9400 et sea. of
the Tustin City Code and provided consent by the City as to the type, design and ~etho~l of
installation is first obtained and proper permits obtained. All signage placed by Lessee on, in
or about the demised premises shall remain the property of the Lessee and shall be removed
by Lessee upon termination or expiration of this Lease at Lessee's expense, and any damage
caused by such removal shall be repaired at Lessee's expense.
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 improvements, 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 condition 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 improvements and receive a certificate of
.occupancy for the building, then surety shall no longer be bound thereon.. Said bond shall'be
maintained in full force and effect by Lessee until-said tenant improvements have been
accepted by the City.
10.2 During any period of construction of the tenant improvements herein required
or otherwise authorized, Lessee shall provide a payment bond in an amount of not less than
one hundred percent (100%) of the costs for the construction to be performed as evidenced by
contracts for all required tenant improvements, payable to the City of Tustin, in conformance
with Section 3085 of the California Civil Code, 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's Key Rating of at least A VII.
10.3 The City Attorney may accept in lieu of the bonds heretofore described, the
performance and payment bonds'of corporations duly authorized to issue surety bonds by'the
State, naming as principal a licensed contractor employed by Lessee to comet works of
improvement on the demised premises provided each bond otherwise 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 securities shall be deemed deposited with City to
Secure full and satisfactory performance of the principal obligations heretofore described for
which surety is required, and shall be released upon satisfactory performance thereof, as
evidenced by certification of completion by the City Manager and unconditional release of
mechanic'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 certificates of deposit are delivered to the City
:
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Manager. Lessee shall be entitled to all interest on the deposit and to the return of the
certificate of deposit upon satisfactory performance as heretofore defined.
11.0 DESTRUCTION OF DEMISED 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 ~hall either restore the demised
premises or terminate this Lease. 'City shall make the loss adjustment with the insurance
company insuring the loss and receive payment 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
construction 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 of insurance are insufficient to pay the actual 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
provided. Any undistributed funds shall be retained by City and credited to the rental reserved
over the remaining term of this Lease. If Lessee elects to restore the demised premises,
plans,specifications, and construction cost estimates for the restoration thereof shall'be prepared
by Lessee and forwarded 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 insurance 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 insurance, workers' compensation
insurance, and standard fire, and extended coverage insurance, 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 nonresponsibility, 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 fight 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 construction to be occurring
thereon. All construction shall be' performed in a good and workmanlike manner. Upon
completion of the restoration, Lessee shall immediately record a notice of completion with the
Registrar-Recorder.
11.2 If the demised premises are restored, this Lease' shall continue in full force and
effect, except that if 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 determine
'16
the damage and/or restoration interferes with the concession operation, provided any such claim
shall be denied'if the destruction of the demised premises is found by the City to have been
caused 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 premises by vacating the
same and removing therefrom all items of inventory, trade fixtures, equipmerit and furnishings
for such periods as are required for the restoration the/eof. '
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 compensation that are. presently available or may hereafter be made
available under the laws and statutes of this State.
.12.0 '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 with 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 tenant
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 furnishings for such periods as are required by the construction of the
new facilities. Lessee further agrees to cooperate 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.
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12:4 The aforementioned provisions of this section shall also be applicable in the
event of performance 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 CONTRACTOR.
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 agen.t, 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 this 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 liability 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 specifically 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 sum equal to one-twelfth (1/12th) of the Minimum Annual Rent. In lieu thereof, Lessee
may deposit said amount in a bank Or other financial insti.tution 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 all of said amount at any time during the term of this Lease.
Lessee shall be entitled to any and all interest accruing from said certificate of deposit.
A. Said sum shall serve as security for faithful performance of all covenants,
promises and conditions assumed by Lessee herein, and may be applied in, satisfaction and/or
mitigation of damages arising from a breach thereof, including, but n6t limited to, delinquent
payments; correction of maintenance deficiencies; securing required insurance; loss of revenue
due to abandonment, vacation or discontinuance of food and beverage operations or tennis
18
concession operations; completion of construction; and payment of mechanic's liens.
Application of amounts on deposit in satisfaction and/or mitigation of damages shall be without
prejudice to the exercise of any other rights provided herein or by lawto remedy a breach of
this Lease.
B. In the event any or all 'said amounts 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 withheld therefrom by City as heretofore provided.
14.2 Additionally, Lessee shall furnish to city a faithful performance bond in a sum
equal to one-sixth (l/6th) of the Minimum 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 California
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 notwithstanding
any payment or recovery thereon.
A. The City Attorney may also accept fi'om the Lessee, in lieu of the bond
heretofore described, the deposit of the required 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 letter of credit payable only to City and in form and content acceptable
to the City Attorney. Lessee shall be entitled to all interest on the deposit and the return of
the certificate of deposit upon satisfactory performance as heretofore def'med.
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 the construction of the work or by or in consequence of any negligence regarding the
work, the use of improper materials or equipment in construction of the work, the neglect or
refusal, of the Lessee to faithfiffiy perform the work and all of the Lessee's obligations under
this 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 cosi/s 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
19
the City, defend any litigation arising out of such claims at the sole cost and expense of the
Lessee. City shall have the right to select legal counsel of its choice in connection with such
defense.
16. INSURANCE
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 its operations hereUnder. Such insurance shall be provided by insurer(s)
licensed to do business in, and in good standing in, the Sate of California, 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 programs 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 insurance. Such insurance, with
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
employees as additional insureds. The City of Tustin Insurance Endorsement Form, a copy of
which is' attached as Exhibit E hereto and incorporated herein by reference, must be executed
· by the applicable insurance Underwriters and delivered to City.
A. During the term of this Lease, following completion of construction of tenant
improvements, Lessee shall provide and maintain the following forms and amoUnts-of
insurance: '
1. Liabili_W: 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 MILLION DOLLARS ($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
period of not less than five years following termination of this Lease.
2. Worker's ~Compensation:i 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 coveting all 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 ~onstmction of tenant improvemenm as required herein,
Lessee shall provide the following forms and amounts of insurance: '"
20
1. Builder's All-Risk Insurance: including flood coverage, covering the
entire work, against loss or damage until completion and acceptance by the City Manager.
Insurance shall be in an amount for the replacement value of the improvements and endorsed
for broad form property damage, breach of warranty, explosion, collapse, and underground
hazards. Deductibles. not 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 all 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 required insurance 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 liability insurance required herein may be subject to
renegotiation on an annual basis. Should either party request renegotiation with respect to the
amount of liability 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 furnish 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 The property interest conveyed herein may be subject to real prOperty taxation
and/or assessments' thereon, and in the event thereof, Lessee shall pay before delinquency all
lawful taxes, assessments, fees or charges which at any time may be levied by the State,
County, City or any other tax assessment-levying body upon the demised premises and any
improvements located thereon. - '-
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17.2 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 ENCUMBERING
18.1 Prohibition of Assignment. 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 voluntarily assign or encumber its interest in this Lease or in
the demised premises, or sublease substantially all or any part of. the demised premises, or .
allow any other person or entity (except Lessee's Authorized Representatives) to occupy or use
all or any part of the demised premises without the prior written consent of City, which
consent shall not be unreasonably withheld. Lessee shall not, without the prior 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 license '
without the consent of the City shall render this 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 against Lessee
or in voluntary or involuntary proceedings in bankruptcy or insolvency or receivership taken
by or against 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, assignment 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 ability 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 Lease arising from the exercise of a power of sale or judicial foreclosure pursuant 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 transfers of this Lease arising from the exercise of a power' of sale or judicial
foreclosure or the assignment 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 withheld.
22
18.7 In the event Lessee shall request the prior written consent of City to give, assign,
transfer or grant control of this Lease, and subsequently City gives written consent to the
assignment, a transfer 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 COMPLIANCE
19. t Lessee hereby certifies and agrees that, in all matters affecting this Lease, it will'
comply with all applicable federal and state laws and regulations prohibiting 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, national origin, political
'affiliation, marital stares, sex, age or handicap and in compliance with all federal and state laws
prohibiting discrimination in employment, including but not limited to, the Federal Civil Rights
Act of 1964; the Unn~ Civil Rights Act; and Cartwright Act; the State Fair Employment
Practices Att 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 origin, political
affiliation, marital status, sex, age or handicap. '
19.4 All employment records shall be open for in~qpeetion and reinspection at any
reasonable time during the term of this Lease for the purpose of verifying the-practice of non-
discrimination by Lessee in the areas heretofore described.
19.5 If City finds that any of the above provisions 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 right to' determine independently that the non-
discrimination pro.visions of this Lease have been violated, in addition, a determination by the
California Fair Employment and Housing Department .or the Federal Equal Employment
Opportunity Commission that Lessee has violated State or Federal non-discrimination laws or
regulations shall constitute a finding by City that Lessee has violated the non-discrimination
provisions .of this Lease.
19.6 Lessee shall include the non-discrimination and compliance provisions in all
subcontracts to perform work under the contra6t.
20.0 TERMINATION OF AGREEMENT
20.1 Upon the occurrence of any one or more of the events of default hereinafter
described, this Lease shall be subject to termination. As a condition precedent, thereof, the
City Manager shall give Lessee ten (10) days notice by registered or certified mail of the date
set for termination hereof and the grounds thereof.
23
20.2 Upon termination City shall have the right to take possession of the demised
premises, including all improvements, equipment, and inventory, located thereon, and use same
for the purpose of satisfying and/or mitigating all damages arising from a breach of this Lease.
20.3 Action by city to effectuate a termination and forfeiture of possession shall be
without prejudice to the exercise of any other rights provided herein or by law to remedy a
breach of this Lease.
21.0 EVENTS OF DEFAULT
21.1 The abandonment, vacation or discontinuance of concession operations on the
demised premises for more than 7 consecutive working days. .
21.2 The failure 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 failure of Lessee to operate in the manner required by this Lease, where
such failure continues for more than ten (10) days after written notice from the City. to correct
the condition therein specified.
21.4 The failure to maintain the demised premises and the improvements construCted
thereon in the state of repair required hereunder, and in a dean, sanitary, safe and satisfactory
condition, where such failure continues for more than ten (10) days after written notice from
the City for correction thereof, provided that where fulfillment of such obligation requires
activity over a perifd of time and Lessee shall have immediately, 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 ten (10) days after written notice from the City for correctiOn thereof, provided that
where fulfillment of such obligation requires activity over a period of time and Lessee shall
have commenced to perform whatever may be required to cure the particular 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 voluntary petition in bankruptcy by.Lessee; the adjudication of
Lessee as a bankrupt; the appointment of any receiver or three of Lessee's assets; the making
of a general assignment for the benefit of creditors; a petition or answer seeking an
arrangement for the reorganization of Lessee under any federal reorganization act, including
petitions or answers under federal laws; the occurrence of any act which.. 9Perates to deprive
Lessee permanently of the rights, powers and privileges necessary for th6 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
24
vacated, dismissed, 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 Determination by the city, the State Fair Employment Commission, or'the
Federal Equal Employment Oppommity Commission of discrimination having been practiced
by Lessee in violation of state and/or federal laws in connection with the Lease.
21.8 Transfer of the majority controlling interest of Lessee to persons other than 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 misrepresentation of fact(s) in its literature, forms and/or
affidavits, which were submitted in response to the Request For Proposals used in the
solicitation process for this Lease.
21.10 Failure to have submitted schematic plans and/or working drawings for tenant
improvements on or before the date(s) designated in this Lease for submission thereof.
21.11 Failure to have commenced required construction of tenant improvements or any
phase ~hereof on or before the date designated in'this Lease for commencement thereof.
21.12 Failure to have completed construction of tenant improvements on or before the
date designated in this Lease for 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 of the same or of any other covenant, condition, term or agreement
herein contained, nor shall failure on the part of City to requi.re 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 of this Lease or stopping City from enforcing
the full provisions thereof.
22.2 No delay, failure, or omission of City to re-enter the demised premises 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 acquiescence ih such default or as a relinquishment
of any right.
..
22.3 No notice to Lessee shall be required to restore or revive "time of the essence"
after the waiver by City of any default.
25
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, options,
privileges and remedies given City by this Lease shall be cumulative.
23.0 RIGHT-OFzENTRY
23.1 Should Lessee be deemed deficient, as determined by the City, in its
performance of its obligations required hereunder, City in addition to all other available
remedies may, but shall not be so obliged, enter upon the demised premises and correct
Lessee's~deficiencies using City forces, and equipment and materials on the demised premises
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 demand thereof.
23.2 In the event of an abandonment, vacation or discontinuance of operations for a
period in excess of 21 working days, Lessee hereby irrevocably appoints City as an agent for
continuing operation of the services granted herein, and in connection therewith authorizes the
officers, emplOyees, agents and independent contractors thereof to (1) take possession of the
demised premises, including all improvements, equipment and inventory thereon; (2) remove
any and all persons or property on said demised premises and place, any such property in
storage for the account of and at the expense of Lessee; (3) sublease or license the demised
premises; and (4) after payment of all expense of such subleasing or licensing apply all
payments realized therefrom to the satisfaction and/or mitigation of all damages arising from
Lessee's breach of this Lease. Entry by the officers, employees, 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 herein or by law to remedy a breach.Of this Lease.
24.0 SIJRRENDER -
24.1 Upon expiration of the term hereof, or termination thereof as herein provided,
Lessee shall peaceably vacate the demised premises and shall remove all tenant improvements,
equipment and personalty used in Lessee's operations. Notwithstanding the foregoing,
however, on receipt of written notice from City, delivered at City's option, Lessee shall instead
surrender the demised premises to City with all tenant improvements remaining in tact and
shall deliver up the demised premises and the tenant improvements, to the extent that City
elects not to have Lessee remove the tenant improvements. Title to the demised premises and
the tenant improvements remains vested in City, pursuant to Section 1.6.
24.2 Upon expiration of the term of this Lease, Lessee shall at City's request, ~execute
and deliver to City within thirty (30) days after service of written demand, a good and
sufficient quitclaim deed of the Lessee's interest in this Lease and the demised premises.
Should Lessee fail or refuse to deliver to City a quitclaim deed as aforesaid, a written notice
by City reciting the failure of the Lessee to execute and deliver the quitclaim deed, shall after
26
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 Lease shall be interpreted according to the roles which govern the
interpretation of contracts, as prescribed in Title 2, of Part 2,`of Division 3, of the California
Civil Code, commencing with Section 1635.
25.2 The headings herein contained are for convenience and reference only and are
not intended 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:
~iCity" - The City of Tustin
"Ci _ty Manager" - City Manager of the City of Tustin or designee.
"Community Services Director" -Community Services Director or designee
"State" - The State of California
"Finance Director" - Finance Director of the City of Tustin, or designee.
"BeVerage'' - Any liquid prepared by flavoring, heating and/or admixing in advance of
consumption 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 Lease, is defined to be all money, cash receipts,
.collected or accrued from the use granted within the demised premises including the rendering
or supplying of services and the sale of goods, foods or beverages.
25'.3.1 Except as specifically provided below or by policy statement issued by the City
Manager, there shall be no deduction fi.om 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 of the Finance
Director and City Attorney, may further interpret the term "gross receipts" as used in' this
Lease.
27
25.4 In the event of any conflict in the definition or interpretation of any word,
responsibility, service or schedule between the body of this Lease and the Exhibits attached
hereto, the terms of the body of this Lease shall control.
26.0 FORCE MA)-EURE/TIME EXTENSIONS
26.1 Except as otherwise specifically provided hereinbefore, and in the event either
party hereto shall be delayed o.r prevented from performance of any act required hereunder by
reason of fire, earthquake, 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 Of time equivalent to the forced delay. Lessee's inability to obtain financing
shall not be grounds for an extension of time. City Manager shall prepare and execute, and
Lessee shall execute the appropriate document acknowledging any extension of time granted
pursuant to this section.
27.0 'LESSEE'S NON-COMPLIANCE
27.1 If the City determines that there are defiCiencies in Lessee's' performance of the
concession operations authorized and required here;in, 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 prescribed
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 this 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 served, return receipt requested, and
deposited in a post office, mailbox, sub-post office, substation or mail chute, or other like
facility regularly maintained by the United States Postal Service.
28
25.4 In the event Of-any conflict in the definition or interpretation of any word,
responsibility, service or schedule between the body of this Lease and the Exhibits attached
hereto, the terms of the body of this Lease shall control.
- .
26.0 FORCE MAJEURE/TIME EXTENSIONS
26.1 Except as otherwise specifically provided hereinbefore, and in the event either
party hereto shall be delayed o.r prevented from performance of any act required hereunder' by
reason of fire, earthquake, 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 of time equivalent to the forced delay. Lessee's inability to obtain financing
shall not be grounds for an extension of time. City Manager shall prepare and execute, and
Lessee shall execute the appropriate document acknowledging any extension of time granted
pursuant to this section. .-
2Z0 'LESSEE'S NON-COMPLIANCE
27.1 If the City determines that theTM are deficiencies in Lessee's performance of the
concession operations authorized, and required herein, the City will provide, as specified in
Section 20 (Defaul0 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 prescribed
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 this 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 served, return receipt requested, and
deposited in a post office, mailbox, sub-post office, substation or mail Chute, or other like
facility regularly maintained by 'the United States Postal Service.
28
The address to be used for any notice served by-mail upon Lessee shall be
addressed as follows:
LESSEE:
TO: Cyran°'s Coffee House
TITLE: Michele Insko
ADDRESS: 7446 E. Chapman, Suite A -
Orange, CA 92669
or alternate 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:
ASSISTANT CITY MANAGER
CITY OF TUST1N
300 CENTENNIAL WAY
TUSTIN, CA 92680
COMMUNITY SERVICES DIRECTOR
CITY OF TUSTIN
300 CENTENNIAL WAY
TUSTIN, CA 92680
Personal service shall be deemed complete on delivery and service by mail shall be
deemed complete upon receipt as reflected by the return receipt.
29.0 SEVERABILITY
.If any provision of this Lease is determined to'be illegal, invalid, or
unenforceable by a court of competent jurisdiction, the remaining 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 shall be responsible for the' enforcement of this Lease on
behalf of City and shall be assisted therein by those officers 'and employees of City having
duties in connection with the administration thereof.
30.2 Any officers and/or authorized employees of City may enter.upon the demised
premises 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 incidental to the
fights of City within the demised premises. :
30.3 In the event either party commences legal proceedings for the enforcement of
this Lease, the prevailing party shall be entitled to recover, its attorney's fees and costs incurred
in the action brought thereon.
30.4 This document may be modified only by further written agreement between the
parties. Any such modification shall not be effective, unless and until executed by Lessee and.
29
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'dOcument, and the exhibits attached hereto, c0nstimtes the entire agreement
between the City and LeSsee for operations and use granted herein. All other agreements,
promises and representations with respect thereto, other than contained herein, are expressly
revoked.
30
IN WITNESS WHEREOF, the City has by action of City Council authorized this Lease
to be executed for and-on behalf of the City of Tustin by the Mayor, and the Lessee has caused
the same to be executed by its duly authorized officer.
"CITY"
CITY OF TUSTIN
Date:
JIM POTTS
MAYOR
ATTEST:
PAMELA STOKER
CITY CLERK
APPROVED AS TO FORM:
CITY ATTORNEY
"LESSEE"
Dated: By:
NalTle:
Title:
31
.
EXHIBIT A
o o
o.
EXHIBIT B
CONCESSION BUILD~G PLANS WITH
DEMARCATION oF DEMISED PREMISES
0
0
0
0
0
0
0
0
0
: I
,/ .;,; - I/
~o
Om
O,
0
H~
I I
il;
i
! t
EXHIBIT C
TENANT IMPROVEMENTS
EXHIBIT D
LESSEE'S PROPOSAL
EXHIBIT D
LE$$EE'$ PROPOSAL
Exhibit D
General Business Statement
Cyrano's Coffee'HOuse located in the city of Orange at the corner of Chapman and
Newport has been operational for three years. My previous business experience included owning,
and as President, managing International Computer Sales, Inc., for nine years. International
Computer Sales, Inc. was a computer hardware company based in Tustim' In 1993, I sold
International Computer Sales, Inc. to Computer Marketplace, a publicly held company.. The total
number of employees at Intern~__fional Computer Sales, Inc. was sixteen with gross sales of
$12,000,000 annually. Cyrano's Coffee House has twelve part time employees with gross sales
last year &approximately $250,000. Gross sales for 1995 will prove to exce~ 1994's gross '
sales.
Concession Payment
$ i ,000 per month base rent. Percentage rent of i 0% of gross sales paid quarterly.
Cash FlOW Analysis and Proforma *revenues could be much higher
Revenue prbducing Operations will include the sale of coffee; tea, smoothies, pi3_3~
sandwiches, cae.~r salad, hot dogs, chili, bagels, pastries, ice cream bars, frozen fruit bars, candy,
and soft drinks, etc.
Total Revenue
$5,350/mo
$64,200/yr
Operating Expenses
Rent .................... " 1000
Cost of Sales ........ ' 1000
Clerk Salaries ......... : ................................ ,..487
Lease on Equipment & Fixturization ...... - ..... 575
Telephone,..i ................................................. 50
Utilities ....................................................... -117
Repair & Maintenance ...... ~ ........................... 25
$3,254/mo $39,048/yr
Profit
$2096/mo $25,152/yr
Estimated Total Revenue'
2nd year - :$70,000
3 rd year $85,000
4th year $95,000
5th year $105,000
Anticipated Funding Sources
Computer Marketplace lease on equipment and tenant improvements. Also a sale of
property now in escrow that will yield $'20,000 profit and $450/mo interest payment on a note
which will be carried back' Anticipated thirty day escrow.
Proposed Price List/Menu - enclosed is a sample of our current menu
Service Program
It is our intention to be open and servicing all activities. In addition we will be open in the
early morning to serve specialty coffee and pastries to the patrons of the park and the school
teachers and parents of children at the. adjacent elementary school. We currently operate a family
owned neighborhood coffee house, where everyone is on a first name basis.~ My husband is there
to' greet and serve our customers. Besides providing excellent food and beverage products, we
special'me in providing a friendly, reli~dng and up beat atmosphere. 'I call it the "Disneyland
effect" where people are happy to be there. I would like to implement a more UPscale concession
stand to meet the needs of the clientele that live in the surrounding area.
Capital Improvement Program &.Equipment
Tenant improvements to be completed within thirty days:
*Tile Floor
*Sinks
*Counters
*Storage Area
*Dry Wall Work
*Safe
$8,000 Total Estimate
Equipment:
*Refrigerators
*Ice Makers ·
*Toasters
*Espresso Machine
*Brewers
*Microwave
*Warming Oven
* Freezer
*Electronic Rotisserie
$17,000 Total Estimate
Installation of a gas line is not necessary.
Cyrano's Coffee House
Income Statement
For the Period of J~inuary, February, March, 1995
~..
Revenue
Sales
Cost of Sales
GroSS Profit
Operating Expenses
Salaries- Management
Salaries - Clerks
Office Expense
Payroll Expense
Rent
Repair & Maintenance- Building
Repair & Maintenance, Equipment
Tax Expense - Payroll.
Security System- ADT
Telephone '
Utilities
Water Softner Service
Total Operating Expenses
Net Income from Operations
Other Income & Expense
Interi~st Expense
Earnings Before Income Tax
$64,197.25
22,148.87..
42,048.38
12,186.43
104.41
'118.08
6,613.44
159.65
231.00
1,246.77
75.00
387.91
1,413.86
78.00
31,614.55
10,433.83
·
900.00
9,533.83
Cyrano's Coffee House
Balance Sheet
Current Assets
Cash
Inventory, Whole Coffee Beans
Inventory- Pastries
Total Current Assets
Fixed A~ssets
Leasehold Improvements
Furniture & Fixtures
Equipment
Accum Depr- Leasedhold Imp
Accum Depr - Furniture &'Fix
Ac, cum Depr- Equipment
Total Fixed Assets
Other Assets
Security Deposits
Total Assets
Assets
$25,991.50
861.00
342.00
14,419.26
11,641.87
21,408.15
(211.47)
(110.32)
(208.58)
5,197.50
27,194.50
46,938.91
$79,330.91
Cyrano's Coffee House
Balance Sheet
Current Liabilities
Notes Payable -'Michele lnsko
Note Payable - Jim Insko
Note Payable- Michele/Ward
Note Payable- Toni Stephens
Total Current Liabilities
Total Liabilities
'Equity
Current Year Earnings
Total Liabilities'and Equity
Liabilities and Equity-
$29,114.86
11,783.39
16,390.00
15,000.00
10,433.83
72,288.25
72,288.25
$82,722.08
References
Remark Management
Dick Cramer, Property Manager
23046 Avendia De La Carlota
Suite 520
Laguna Hills, Ca 92653
(714) 830-5730
I1 Forniao
Leslie, Vendor Representative
(714) 261-1800
1000 Sansome Street
2nd Floor
San Francisco, 'Ca. 94111
(415) 986-1505
,
pOrter Secretarial Services - Advertising
Sam Porter
7828 E. Lakeview Trail
Orange, Ca 92669
(714) 639-6468
Graphic Impressions - Advertising
Terry Laughlin
23257 La Palma
Suite A
Yorba Linda, Ca 92687.
(714) 692-8900
· 5. Sysco Food Service
Mark Jarosz
20701 East Currier Rd.
Walnut, Ca 91789
(800) 800-1188, Ext. 4361
6.
Gavina Gourmet Coffee
Jose Porter
2369 E. 51st Street
Vernon, Ca 90058
(213) 582-0671, Ext. 250
.
Farmers Insurance Group
Keith Deckard
20051 S.W. Birch Street
Suite //305
Santa Aha Heights, Ca
(714) 756-1888
92707
ge
Alta-Dena Certified Dairy
Pat Hardy'
17637 Valley Blvd. -
City of Industry, 'Ca : 91747
(818) 964-6401
9.
Pasquini Espresso Company
Ciro Miceli
1501 West Olympic Blvd
Los Angeles, Ca 90015
(800)' 321-3298
I 0. WeStern Bagel' Too, Tustin
Dennis wantink
506 E. 1st Street
Tustin, Ca 92680
(714) 730-0611
1 1. Maggie's Scones
5 Crystalglen
Aliso Viejo, Ca
(714) 707-6982
92656
Financial References
Orange National Bank
7510 E. Chapmen Ave.
Orange, CA 92669
(714) 771-4000 :
Cyrano's Checking Account
Acct. # 704-404824
,
Orange National Bank
.7510 E, Chapman Ave
Orange, Ca 92669
(714) 771-4000
personal Checking Account
Acct. # 704-010818
e
Orange National Bank.
1201 E. Katella AVe.
·
Orange;" Ca 92667
(714)771-4000
Equity Lin~
Acct. # 701-630777
4. · Pasquini Espresso Company
1501 West Olympic Blvd..
Los Angeles, Ca 90015
(800) 321-3298
Purchased espresso machine on
installment payments.
Payments comPleted
.
Circuit City
.1407 W, Chapman Ave.
Orange, Ca · 92667
Purchased a refrigerator on
installment payments.
Payments completed
A S~RVIC. E ORff. NII~D COMPANY
Michele lnsko
Cyrano's Coffee House
7446 E Chapman Ave
Ste A
Orange,CA 92669
S/S/9~
Dear Mrs. Insko,
Enclosed is the approval for the addition
of the equipment you have chosen-to lease with a total male price of $ 25,000.00
for you.r second location
The total amount of the lease will be for $ 25,000.00 over 5 years with a mont. hly payment
or' $ 575.00 and a $1.00 buyout option at the end ofthe lease expirzt:,on
Please fee! free to contact me with any questions you may have,
Thank you for the business.
Thomas R Simon
9Ol-A North PockS- Cc>ocs 14~t't.
S~to 200
~~o ~. ~ 9021 ?
~ (310) 79~O~
Name ot"Proposer
PROPOSAL FOR CONCESSION AT
TUSTIN SPORTS PARK
I propose to provide ~'OO
in the following attachments.
concession services, at Tustin Sports'Park, as described
le
2~
3~
Minimum qualifications
Statement of Professional History-
Affidavit to Accompany Proposals
4. Special Ihformation
5. Authorization to Release Information
6. Equal Employment Opportunity Certification
I have read this Request for Proposal. i am p~-~nall.y acquainted with the premises of the above-named
facility and' am acquainted with services requested, and I meet the qualifications for submitting a
proposal ....
I have enclosed a certified or cashier's check in the amount of Five Hundred Dollars ($5i2)0), payable
to the City of Tustin as a guarantee that I will enter into an agreement in the event ~my proposal is
accepted.
The undersigned hereby respectfully submits this proposal, including all required documents and
:
statements.
!!-8 -- -
(Indicate the form of business
concern on the line above~' i.e.
.corporation, individual,
partn~%q~hip, joint ve..~ture.)
S ggMt~ig-" - -' u ; - , -
Address
(Indicate your, position, title
or function.)
Signature
Address
l~elephone # Telephone #
Warning: Proposals are subject to being rejected as non-responsive of this proposal form .is not fully
executed including the certificate of the notary and the notarial seal
(This document to be; notarized).
FOR OFFICE USE ONLY
()
Proposal Guarantee
()
Business Refererices
'(). Professional References
()
Proposal Form, Notarized
( ) General Business statement ( )
Financial References
( ) Statement of Personal. History (). Proposed PriCe
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Bidder's EEO Certification
()
( ) Maintenance.Program ( )
Affidavit
()
Authorization to Release
Information "
( ) Service Program
( ) Financial Statement
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LEGAL NAME:
dba (if any):
STATEMENT OF PROFESSIONAL HISTORY
o
o
4~
6~
RESIDENCE ADDRESS:
SOCIAL SECURITY NUMBER:
Have you or your spouse ever filed for ban. kruptcy or been
bank. rupt7 Yes ~ No 'X
Have you ever been fired or asked to resign?
Yes No ~/'
declared
Have you as an adult ever been conviCted, fined, placed on probation, given a suspended sentence
in i~ny court, or had any convictions, expunged under Sections 1203.4 or 1203.4A of the Penal
Code? Yes ... No }(/
Have you, or any principal, eve. r had a bond or surety canceled or
forfeited? Yes No ){ _ .
NOTE: If .you answered "Yes". to any questions in Item 6 above, pertinent details must be
provided on an additional sheet. Failure to do so may result in a delay, or possible
disqualification of the proposal.
I hereby certify that all statements made on or in connection with this Statement of' Personal History are
true to the best of my knowledge and belief, and I understand and agree that any misstatements' or
omission of material fact may cause forfeiture on my part of a!! rights to the proposed agreement to be
awarded by the City of Tustin.
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AFFIDAVI'F 'FO ACCOMPANY PROPOSALS
orATE OF CALIFORNIA
City of Tustin
: being first duly sworn, dcposes and states:
who submits herewith to the City.of Tusfin the mt,ached proposal;
Affiant deposes and ~ates: That the proposal is genuine; that the same is not a sham or collusive; that all statements of
fact therein are true; that such proposal was not made in the interesI or behalf of any person, partgership;.company, association,
organization, or oorporation not thea'ein named or disclosed.
Affiant deposes and mates: That the proposer has not directly or indirectly by agreement, conmmnication, or conference
with anyone attempted to induce action prejudicial to the interest of the City of Tustin,'or any other proposer, or anyone rise
interested in the proposed agreement; that the proposer? not in any mmmer sought by collusion to secure for himself, itself, or
themselves, an advantage over any other proposer.
Affiant further disposes and states:
(a) That none of our employees are employees of the City of Tustin.
. .
(b) That no City employee or City Council member serves as officers, principals, partners, or major shareholders
of this proposer,
(c) That we are not fom~er Ciiy employees who have been employed bY the City of Tustin in the twelve months '
immediately preceding the date of this affidavit in positions of substantial responsibility in the area of service
to 'be provided by the prbposed a~eement, and that no such employees have taken part in the development of
said proposed agreement or its seix-ic-e specifications,.
(d) That no person who has been employed by the City within the twelve months immediately preceding this
affidavit serves as'an officer, principal, partner, or major shareholder of .this proposer.
.
I understand and agree that any falsification in ~his affidavit will be grom~ls for rejection of this proposal or cancellation
of any agreement awarded pursuant to this propos~'fi.
I certify under penalty of perjury under the laws of the State of California thru the foregoing is c~rrect and true.
WARNING: PROPOSALS
Dated:
WILL NOT BE CONSIDERED UNLESS THE AFFIDAVIT
HEREON Ig FULLY EXECUTE INCLUDING THE CERTIFICATE OF THE
NOTARY AND THE NOTORIAL SEAL. ~--
/ . _ .
Title
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JURAT CERTIFICATE
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State of California
County 'of Orange
The preceeding document, Affidavit to Accompany Proposals,
~s subscribed and sworn (or affirmed) before me, Diane E. Jones,
Notary Public, this 12th Day of May, 1995, by Michele Insko.
CITY OF TUSTIN AUTHORIZATION TO RELEASE INFORMATION
I hereby authorize the release of all financial and 'credit i:nt'ormation and/or verification of employment
to the City of Tustin as said items related to my interest in securing an agreement with the City.. This
form may be reproduced or photocopies to be utilized as my consent to release financial and credit
information or employment verification..
Print Name Here
Financial Institution
Applicable Accounts(s)
(number and type)
Financial Institution
APplicable Account(s)
(Number and Type)
_ _ 11-12
EQUAL EMPLOYMENT OPPORTUNITY (EEO) CERTIFICATION
Bidder's Name
Addre~
Internal Revenue Service Employer Identification Number .
GENERAL.
The undersigned certifies and agrees that all persons employed by such firm, its affiliates, subsidiaries,
or holding companies are and-will be treated equally .by the firm without regard to or because of race,
creed, color, national origin, political affiliation, marital status, age, disability, or sex and in compliance
with all anti-discrimination laws of the United States of America and the State of California.
PROPOSER'S CERTIFICATE
o
The proposer has a written policy statement prohibiting discrimination in all phases of
employment.
Yes. 5<' No~
2. The proposer periodically conducts a self analysis or utilization analysis of its work force.
Yes ,, ~' No~
3.
The proposer has a system for determining if its employment practices are discriminatory against
protected groups.'
Yes ~ No
o
Where problem areas are identified in employment practices, the proposer has'a system for taking
reasonable corrective action to include establishment of goals and
timetables. Yes ~ No
Name and Title of Signer (Please Type or Print)
Date
EXHIBIT E
CERTIFICATE OF INSURANCE
TO:
CERTIFICATE OF IN:
CITY OF TUSTIN
ANCE AND'DESIGNATION OF
ADDITIONAL INSURED
NO MODIFICATIONS OR ADDITIONS MAY BE MADE TO THIS FORM
CiTY OF TUSTIN
P.O. Box 3539
Tusdn. CA 92681-3539
NAME ANO ADORESS O1:: INSURED CONTRACTOR:
·
NAME AND AOORESS OF INSURANC~ AGENCY:
PROJECT:
COMPANIES AR:ORDING COVERAGE
Company Le~ler A
Company Latte¢ 8
Company Le~e¢ C
Comp~,~y L~tx.r D
Company Let~e~ E
r
Company La~cr F
Typ~ of In~ur~nca
GENERAL UABIUTY
[ ! Commercial C. eneeal
Uabilrrp(
( ] Cla~rr~ Made [ ] bCC.
[ ] Ovmer'e & Contractor'
Prote~ve
[]
[]
AUTOMOBILE UABIUD
[ ] Any Auto
[ ] .Ail Owned-Autos
J ] Scheduled Au'to~
( ] H-~'ed Auto:~:
( ) N~~d Au;os
J ] Garage ~ab~
Po~c~ Number
OTH~J:[
Por, cy
Effective Date
De;c3~ption of Opeeation~/Location~Neh;de~ Special Itents
Geneeal Aggregate $
.-
Prode-C<~npl S
Ope Agg.
Per~. & Advg. ~ $
(Any ~ F~el
Me~cal Expe~e , S
(Any gna Period}
s
(Per
(Per Oc~en~}
AGGREGATE
STATUTORY
$ Each Acc~d-.nt
$ Di~;eace..4~ach Employee
It k ocrtif~cd that a wa~v~¢ al ~ub¢ogetlon k I'~:¢eby ~u~d to the C~ty of Tu~6n ae peflain, to tt~ te~'m¢ at aU Workefc Compen4at'mtt ~"~Juranc,~ The i¢ - '*;nj
company will give th~'(y (3Ol day~ w'¢i~¢n notice to the C~ty o! Tustin pr~o¢ to modification or cancellation.
DATE ISSUED:
Autho~'ized Rep¢¢i;~ntat~ve o( the above.-.nafned b'~cufance con'~any(;e,
EXHIBIT F
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