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cA`'F°a"�P CITY COUNCIL STAFF REPORT
DATE: December 17, 2014 CONSENT AGENDA
SUBJECT: AIRPORT ADVERTISING CONCESSION CONTRACT SERVICES
AGREEMENT AWARD TO COREY AIRPORT SERVICES
FROM: David H. Ready, City Manager
BY: AIRPORT
SUMMARY
This action considers the award of the Palm Springs International Airport Advertising
Concessions Contract.
RECOMMENDATION:
1. Approve Contract No. 5855 with Corey Airport Services for a term of five years
for the Airport Advertising Concessions program.
2. Authorize the City Manager to execute all necessary documents as required.
STAFF ANALYSIS:
In 2009, it was recognized that the airport's advertising concession program was
outdated, and a new program was necessary. That new program was designed to
include the removal of existing advertising equipment and replacing it with more
architecturally compatible equipment utilizing technology that would provide maximum
return on investment for all advertisers and generate increased revenues for the airport.
A national solicitation was conducted in 2009, and after a thorough selection and
negotiation process, Corey Airport Services became the new PSP Airport advertising
concessionaire for the ensuing five years and their current contract term expires this
month. The program has been a successful in generating revenues for the airport and
providing local businesses exposure capitalizing on the airport's record passenger
traffic.
With the current contract expiring, the Procurement and Contracting Department worked
with Airport staff to prepare a Request for Proposals (RFP) #01-15 for a new five-year
contract services agreement. The RFP was posted to the city's website, advertised
locally in The Desert Sun and nationally with the American Association of Airport
ITEM NO. Q_
City Council Staff Report
December 17, 2014 -- Page 2
AIRPORT ADVERTSING CONCESSION
AWARD TO COREY AIRPORT SERVICES
Executives (AAAE) industry-wide newsletter, and then electronically transmitted to
twelve prospective firms. Six firms registered for the RFP process and the City received
proposals from the following three experienced airport advertising specialty firms: Clear
Channel Airports, Corey Airport Services, and Departure Media.
A selection committee consisting of two Airport Commissioners, the Executive Director
of the Convention Center and Bureau of Tourism, and two Airport Executive
Management staff members evaluated the proposals and unanimously selected Corey
Airport Services for recommendation of a contract award based on the firm's excellent
qualifications and experience, strong program management and marketing plan, and
attractive financial offer for the Airport.
The terms of the contract with Corey Airport Services include the following:
• A five-year term
• At minimum a part-time Corey manager based in the Coachella Valley
• A $280,000 program investment by Corey for improvements
• Corey will pay the Airport a minimum annual revenue guarantee of $300,000 in
the first year and $350,000 every year thereafter, or fifty (50) percent of gross
revenues, whichever is greater. The Airport will receive fifty-five (55) percent of
revenues over $800,000.
The new advertising program is fashioned to maintain the overall footprint of the existing
program in order not to impede passenger flow as the airport's record growth continues.
The most important change in this program will be a reduction in the height of the
baggage claim box advertising dioramas. This will improve the line of sight for
customers retrieving luggage, and create a more subtle advertising message.
Additionally, the large static units located on the back wall in the baggage claim area will
be replaced with a digital wall consisting of LED monitors programmable for multiple
messaging in a more professional and effective manner. This represents a major
capital investment which will be the responsibility of the concessionaire and remain the
property of the airport at the end of the five-year agreement, as will other program
modifications. As a result of newer digital technology enhancements, it is anticipated
that revenues will again improve due to the caliber of equipment and the number of
additional messaging opportunities. Airports throughout the country are embracing this
same digital approach to advertising concessions.
The new agreement also includes provisions allowing the Palm Springs Bureau of
Tourism dedicated locations to advertise the Palm Springs Brand and events hosted by
the City. These locations include both digital and static units that will provide messaging
throughout the entire terminal complex and both concourses.
02
City Council Staff Report
December 17, 2014-- Page 3
AIRPORT ADVERTSING CONCESSION
AWARD TO COREY AIRPORT SERVICES
FISCAL IMPACT:
With increased annual revenue guarantees to the Airport and a more technologically
expansive program, the overall revenue of the program is projected to increase.
Program revenues from the past five years:
Year Gross Revenue
2010 $392,297
2011 $484,231
2012 $603,307
2013 $655,771
2014 (projected) $695,130
TOTAL $2,830,736
It is anticipated that revenues under the new proposed contract would increase
approximately 20-30%.
Comparing this firm's overall revenue projections with other two proposal submissions,
the revenue was about the same, however, the other vendors were reliant on either a
sizeable increase of the "advertising footprint" or aggressive rate increases for
advertisers. Under the recommended contract, the footprint presents a smaller
streamlined presence that preserves the architectural balance of buildings.
.< L
Thomas Nolan,
Executive Director, Airport
David H. Ready, C' ger
Attachments: Concession Agreement
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AIRPORT DISPLAY ADVERTISING
CONCESSION AGREEMENT
PALM SPRINGS INTERNATIONAL AIRPORT
This Concession Lease Agreement ("Agreement') is made and entered into effective this 17th
day of December 2014 (the "Effective Date") by and between the City of Palm Springs, a
California charter city and municipal corporation ("City"), and U.S. Enterprises Inc. d/b/a Corey
Airport Services, a Georgia corporation ("Concessionaire").
RECITALS
A. The City owns and operates Palm Springs International Airport ("Airport") located in Palm
Springs; California for the convenience of the general public.
B. The City has determined that it is desirable to have a high quality,professionally designed and
managed advertising concession that will maximize advertising revenues, facilitate passenger flow
and be architecturally compatible with the Airport.
C. In response to a Request for Proposals, the Concessionaire has submitted a proposal to
develop and manage the display advertising Concession at the Airport.
D. The City approved the selection of the Concessionaire to operate and manage the display
advertising concession on the Airport.
NOW, THEREFORE, in consideration of the mutual covenants, terms, conditions,
privileges, obligations and agreements herein contained, and other valuable considerations, the
City and the Concessionaire hereby mutually undertake, promise and agree, as follows:
Article 1
Definitions and Interpretation
1.01 Definitions
Except as otherwise clearly indicated by the context, the following words, terms and phrases
wherever used in this Agreement shall, for the purpose of this Agreement, have the following
meanings:
1. "Advertisements" means advertising copy, advertising materials, and any manner of
commercial presentation.
2. "Agreement Year" means the twelve month period from April 1 st to March 31st of each year
of the Term.
3. "Airport"means the Pahn Springs International Airport.
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110669A
4. "Assigned Area(s)" means the areas at the Airport shown on Exhibit "A" to this
Agreement that the Concessionaire is authorized to use for the operation of the Concession as
provided in this Agreement.
5. "City" means the City of Palm Springs, a California charter city and the owner and
operator of the Palm Springs International Airport and governed by the City Council of the City
of Palm Springs.
6. "City Manager"means the City Manager of the City or the designee or designees of the
City Manager.
7. "Effective Date" means December 17, 2014.
8. "Concession" means the right, privilege, and obligation to develop, maintain and operate the
Program pursuant to Section 3.01 of this Agreement and subject to all requirements and
limitations provided in this Agreement.
9. "Concessionaire" means U.S. Enterprises, Inc. d/b/a/ Corey Airport Services, a Georgia
corporation and includes its contractors, employees,partners, invitees, agents, or anyone operating on
behalf of the Concessionaire.
10. "Advertiser" means any person or entity that contracts with the Concessionaire for the
provision of advertising services of any kind at the Airport.
11. "Fixed Improvement" means any alteration, addition, annexation or improvement to the
Assigned Areas or a portion thereof which cannot be removed or changed without material damage
to, or destruction of, either itself or the Assigned Areas or a portion thereof,
12. "Gross Revenues" means all monies or other consideration paid to or payable, cash or
credit, to Concessionaire for sales made and for services rendered at or from the Airport,
regardless of when or where the order therefore is received, or delivered, whether on a cash basis or
credit. 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 any payment is
received. There shall be allowed, when properly recorded and accounted for as a reduction from
Gross Revenue the following:
a. Actual advertising sales commissions paid and documented by Concessionaire to a
recognized third party sales/advertising agency other than Concessionaire or any
company affiliated with Concessionaire, such commissions not to exceed 15%.
b. Amounts owed which Concessionaire deems un-collectible after diligent
collection efforts. In no event shall more that 2.5% of Concessionaire's Gross Revenue be
deducted from total revenues as "bad debts." When Concessionaire after
diligent collection efforts is unable to collect amounts due from an advertiser upon
which Concessionaire had previously based Percentage Fee payments, such bad debts
shall be deemed uncollectible and an appropriate adjustment shall be made in
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Concessionaire's subsequent statements and Percentage Fee submissions. The
uncollectible bad debts will be accrued and deducted from the Concessionaire's
Percentage Fee at such time as Concessionaire commences paying such Percentage
Fee. If Concessionaire collects bad debts after adjustments are made to Gross Revenues,
then an appropriate adjustment shall be made to subsequent revenue statement and Percentage Fee
submission. This adjustment shall exclude external collection costs.
C. Sales or excise taxes that are imposed by law and paid to a government entity. This
provision shall not allow Concessionaire to exclude from Gross Revenues the concession
fees or Minimum Annual Guarantee specified in Article 4 herein.
d. The actual amount of a credit or refund given to an advertising customer resulting
from the delay in the commencement of the advertising display provided such delay was not
caused by Concessionaire.
C. The phone/data communication service charges are excluded from the Definition of gross
revenue.
13. "Hazardous Materials" means any substance, chemical, or waste which at any time shall be
defined as hazardous, toxic, or dangerous under applicable federal, state or local laws or
regulations that govern (1) the existence, cleanup, or remedy of contamination on property; (2) the
protection of the environment from spilled, deposited, or otherwise emplaced contamination; (3) control
of hazardous wastes; or (4) the use, generation, transport, treatment, removal, or recovery of hazardous
substances, including building materials.
14. "Minimum Annual Guarantee" means the minimum concession fee payable by
Concessionaire to City of Three Hundred Thousand Dollars ($300,000.00) for the first Agreement
Year and Three Hundred and Fifty Thousand Dollars ($350,000.00) for each successive Agreement
Year during the Term in the manner provided in Section 5.01 of this Agreement.
15. "Minimum Capital Investment" means at least Two Hundred and Eighty Thousand Dollars
($280,000.00) for the cost paid to contractors and/or subcontractors for improvements, furnishings,
fixtures, and equipment (exclusive of leased equipment) required under the Program. The term
"Minimum Capital Investment" includes architectural and engineering costs which are not to exceed
ten percent (10%) of the minimum construction expenditures, and does not include any finance or
interest expense, supervisory or overhead costs, or any other markups of any kind of Concessionaire or
any fees payable to the City under Article 4 or Article 5 of this Agreement.
16. "Operating Equipment" means personal equipment and trade fixtures that are famished,
installed, or used by the Concessionaire in its operations on the Airport. It does not include Fixed
Improvements, nor does it include displays or decorations that are of a seasonal or temporary
promotional nature.
17. "Percentage Fee"means an amount equal to 50% of gross revenues for the first$800,000.00 of
Gross Revenue in an Agreement Year and 55% of all revenues in excess of$800,000.00 in Gross
Revenues in an Agreement Year,
3 Revised: 6/16/10 12
,20669.1
18. "Program" means the comprehensive advertising program, integrated and coordinated
with respect to design, quality, and content for the Airport, as described in Exhibit "A" to this
Agreement.
19. "Rules and Regulations" means the provisions of Title 16 of the Palm Springs Municipal Code,
as may be amended form time to time, and any rules and regulations of the City Manager promulgated
thereunder.
20. "Perm"means the term of this Agreement as provided in Article 2 of this Agreement.
21. "Term Commencement Date"means April 1,2015.
Article 2
Term of Agreement
This Agreement shall become effective upon execution by all parties. The Tenn of this Agreement
shall be a period of five(5)years, commencing on the Term Commencement Date and terminating on Mardi
31,2020 unless sooner terminated in accordance with this Agreement Any occupancy or use of the Assigned
Areas by Concessionaire prior to the commencement of the Term shall be subject to all terms and conditions of
this Agreement
Article 3
Use of Assigned Areas and Operation of Concession
3.01 Grant of Privilege
1. The City hereby grants to Concessionaire the rights to operate, maintain, and provide the
Concession and Concessionaire shall install and maintain the Program. Under this Program,
Concessionaire shall have the right to establish, operate, service, and maintain quality, expertly
designed commercial advertising displays, including without limitation: flat screen cases, free-
standing displays, wall mounted displays, dioramas, interactive kiosks, brochure racks, digital
advertising media, wall wraps, video, directories and other similar advertising for the purpose of
promoting or displaying the products or services of various industries, manufacturers,
companies, agencies, and persons fully consistent with the requirements of this Agreement. The
specific locations for displays are the Assigned Areas. No advertising shall be permitted at the
Airport out of the Assigned Areas. Any additional areas made available for advertising at the
Airport by the City shall be added to Exhibit "A" and shall be approved as an amendment to this
Agreement. Concessionaire shall have the exclusive advertising use of all Assigned Areas.
2. Concessionaire shall be responsible for the Program within the Assigned Areas at the
Airport and shall apply the financial, marketing, and administrative resources of its organization
to the implementation of the Program. Through its national, local and regional organization,
Concessionaire shall:
a. Develop, on a continuing basis, an integrated business plan for advertising at
the Airport.
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720669.1
b. Follow quality criteria that recognize the need for integrity of design and
advertising content appropriate to the prestige and dignity of the Airport.
C. Practice space utilization planning which will recognize and meet the needs
of all advertising classifications and insure maximum revenue return to the
City consistent with the scope and integrity of the advertising master plan.
d. Provide a sales organization, including a locally based concession manager with
ability and experience of sufficient scope to solicit and sell local, regional, and
national advertising for display at the Airport, with a primary emphasis on local
advertising. The local manager must be available a minimum of 80 hours per
month.
e. Provide advertising and display equipment and fixtures that are consistent with
the architectural design of the Airport.
3. Except as provided elsewhere in this Agreement, Concessionaire shall be solely
responsible for all expenses associated with planning, implementing, refurbishing, maintaining,
and operating the Program provided for in this Agreement, whether or not advertising displays
and equipment were installed by Concessionaire. This includes, without limitation, the cost of
utility connections for all equipment within the assigned areas.
4. The City reserves the right to add or modify advertising locations and formats, at any
time, which may benefit the Airport, provided the City Manager consults with Concessionaire
before affecting such additions or modifications. These changes may include without limitation
video screens on the baggage claim carousels, a terminal directory, outdoor advertising, wall
wraps, and other formats/technologies that may become available in the future. All costs
associated with the development of advertising materials or modification of equipment shall be
the sole responsibility of the Concessionaire.
5. Upon execution of this Agreement, the Concessionaire shall have rights of ingress and
egress to and from the Assigned Areas, including but not limited to common use roadways,
subject to the Rules and Regulations. Such rights of ingress and egress shall apply to the
Concessionaires employees, customers, agents, contractors, suppliers, and other authorized
individuals.
6. If a concession change occurs, Concessionaire shall use its best efforts to reasonably
cooperate with the City and the City's future advertising concessionaire to ensure a seamless
transition of responsibility from the current Concessionaire and minimize any disruption in the
provision of advertising services at the Airport.
3.02 Exclusions from Agreement
The following advertising rights are not included under this Agreement:
5 Revised: 6/16/10 14
P_IXrG9.I
a. Internet Services (subject to negotiation). This includes but is not limited to
self-service monitors, internet kiosks, Wi-Fi, or other paid or advertising
supported internet services at the Airports.
b. Retail display advertising on tenant premises except as approved by the
City Manager.
C. Advertising on bus terminals or benches.
d. Airport related, or Airport directed information and promotions.
3.03 Use of Airport Facilities
1. The Concessionaire shall use the Assigned Areas only to operate the Concession.
Concessionaire shall not maintain any other use within the Assigned Areas unless previously
authorized by the City Manager in writing, which authorization may be withheld in the City
Manager's sole discretion. Concessionaire shall use its best efforts in every proper manner to
maintain, develop, and increase the sales of advertising developed under the Program.
2. If requested by Concessionaire, Concessionaire shall be provided a work area by
appointment, this space will not be permanent. The office will be occupied by a manager or a
representative of Concessionaire during normal business hours of the Airport unless otherwise
approved by the City Manager. One parking space at no cost to Concessionaire in the City's
employee parking lot available at all times, and access to no cost visitor parking for advertisers
or other persons doing Airport business with the Concessionaire at the Airport.
3. Concessionaire shall a the City Three Hundred Dollars 300.00 per month for
pay Y ($ )
utilities, including electrical services.
3.04 Adjustment and Relocation of Assigned Area
The City reserves the right to relocate any Assigned Areas in which Concessionaire is
granted the privilege to conduct its Concession. The decision of the City on any advertising
locations shall be final. Such relocation demands shall be provided to Concessionaire in
writing from the City Manager at least sixty (60) days prior to such needed action unless such
relocation results from an emergency, in which case notice which is reasonable under the
circumstances shall be given. The Minimum Annual Guarantee and/or Percentage Fee shall be
adjusted in accordance with the impact on exposure of the public to Concessionaire's additional
or modified locations and formats as reasonably determined by the City Manager. Any
additional areas made available for advertising at the Airport by the City shall be added
to the Assigned Areas. The reasonable cost of such relocation shall be borne by the City. A
revised Exhibit "A" shall be substituted to show any additions or deletions to the Assigned
Areas.
3.05 Use of Terminal Building
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720669J
Concessionaire shall have the right of use, in common with others authorized to do so,
of the common areas in the Terminal Building; provided, however, that such use shall be
subject to and consistent with the Rules and Regulations.
3.06 Parking
Concessionaire shall have the right to utilize vehicular parking facilities for
Concessionaire's employees in a manner and of a type similar to or equal to that provided for
employees of other Airport tenants or concessionaires.
Article 4
Advertisine Rates and Standards
4.01 The Concessionaire shall submit to the City Manager, on an annual basis, a schedule of
monthly rates to be applied to the advertising locations. Advertising locations may be subject to
quantity purchase and other incentive discounts and to standard/sales advertising agency
deductions or commissions as expressly provided in this Agreement.
4.02 Concessionaire shall obtain the City Manager's approval before any advertising display
shall be placed in any location allocated for such purpose. The number, type, size, and content
of all Advertisements within the Airport is subject to the approval of the City Manager and shall
not contain nudity, profanity, pornography, or any content which the City Manager reasonably
determines, in his or her sole discretion, is harmful to the public peace, safety, health, and/or
welfare.
4.03 Concessionaire further agrees that it will not display or advertise locations, businesses,
facilities, activities, or events in other desert communities or other warm-weather, winter resort
areas in California, Arizona, Nevada (including without limitation Las Vegas), New Mexico,
Florida, or Mexico unless Concessionaire receives prior approval from the City Manager. This
prohibition shall not include businesses, facilities, activities, and events in the Coachella Valley.
4.04 Concessionaire shall not display any Advertisements reasonably disapproved by the City
Manager or which conflict with the provisions of this Article 4 and Concessionaire shall
immediately remove from the Airport upon written demand of the City Manager, at
Concessionaire's sole cost and expense, any such Advertisements. In the event that any such
Advertisement is not removed promptly upon receipt of written demand, the City may remove
and store said Advertisement. The City shall not in any way be held responsible or liable for any
damage to any Advertisement so removed. No Advertisements reasonably considered offensive
by the City may be presented to the public. The Concessionaire will promptly remove or modify
the presentation of any Advertisement if so directed by the City Manager, at the City Manager's
sole discretion. Where any backlit or other graphic display case of Concessionaire does not
contain an Advertisement, such display case shall contain filler graphics.
7 Revised: 6/16/10 16
720669,1
4.05 In accepting the limitations on advertising provided in this Article 4, Concessionaire
waives any and all rights it may have regarding the regulation of content of its advertising
displays at the Palm Springs International Airport and will hold the City harmless for any
damage or loss of income it may suffer as a result thereof.
4.06 Concessionaire shall submit a bi-annual performance metric evaluation to the City
Manager or his designee for his input and rating of the local operation, implementation of
standards and customer interaction.
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7'_0669,1
Article 5
Fees
5.01 Term Minimum Annual Guarantee and Percentage Fee
During the Term of this Agreement, Concessionaire agrees to pay to the City for the
privileges provided under this Agreement, a monthly fee equal to the Minimum Annual
Guarantee or the Percentage Fee, whichever is greater, for each calendar month for each
Agreement Year. All such payments shall be due on the twentieth (20`h) calendar day of the
month immediately following the month in which Gross Revenue was generated. In any
Agreement Year during the Term, in the event the total number of passengers passing through
the Airport (the "Total Passengers") declines by twenty percent (20%) or more from the Total
Passengers for the calendar year 2013, the Minimum Annual Guarantee shall be reduced by the
same percentage as the reduction of Total Passengers for the Agreement Year in question and
shall remain at that amount until the Total Passengers for any Agreement Year are not less than
eighty percent (80%) of the Total Passengers for 2013. The City shall provide Concessionaire
with the Total Passenger figures for each Agreement Year within ninety (90) days following the
end of such Agreement Year. The Minimum Annual Guarantee shall be increased or decreased,
as the case may be, retroactive to the first day of the Agreement Year after the Total Passenger
figures have been delivered to Concessionaire, provided the increase does not exceed the
amounts set forth in Article l.01 (14).
5.02 Procedure for Payment of Fees
1. Both the City and the Concessionaire acknowledge and agree that the Concessionaire's
monthly payments of the Percentage Fee and Minimum Annual Guarantee during the Term shall
be computed and reconciled on an annual basis on or before the twentieth (20`h) calendar day of
the next calendar month following the last calendar month of the Agreement Year.
2. No later than ninety (90) days after the end of Concessionaire's fiscal year,
Concessionaire shall furnish to the City the written statement of a Certified Public Accountant
stating that the Privilege Fee paid by the Concessionaire to the City pursuant to this Agreement
during each of Concessionaire's fiscal years is accurate. Such statement shall also state Gross
Revenues as shown on the books and records of Concessionaire that were used to compute the
Percentage Fee made to the Director of Aviation during the period covered by the statement.
3. If,at the end of any Agreement Year,the total amount of monthly installments of the Percentage
Fee paid by Concessionaire for such Agreement Year is less than the total amount of the Percentage Fee
required to be paid by Concessionaire for such Agreement Year, Concessionaire shall pay the amount of
such deficiency on or before the time Concessionaire provides its Annual Statement as provided in
this Agreement. In the event that any additional Percentage Fee shall be determined to be rightly
due and owing by any audit of Concessionaire's books and records, such amount shall forthwith
be paid by the Concessionaire to the City with interest thereon at the rate of twelve percent
(12%) per annum from the date such additional Percentage Fee became due; provided, however,
that the foregoing not be applied to amounts contested in good faith by Concessionaire.
4. If, at the end of any Agreement Year, the total amount of monthly installments of the
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720669 i
Percentage Fee paid by Concessionaire based on Gross Revenues for such Agreement Year exceeds
the total amount of Percentage Fee required to be paid by Concessionaire for such Agreement Year as
indicated in Concessionaire's Annual Statement, Concessionaire shall receive a credit equivalent
to such excess which shall be credited by City to the next monthly payment due from Concessionaire
to City under this Agreement, or City may at its option pay Concessionaire in one lump sum within sixty
(60) days thereafter. If at the end of the final Agreement Year the total amount of Percentage Fee
paid by Concessionaire exceeds the total amount of Percentage Fee required to be paid by
Concessionaire for such Agreement Year, such excess shall be refunded to Concessionaire within sixty
(60) days after Concessionaire has vacated the Assigned Areas at the conclusion of this Agreement
and the Assigned Areas are in the condition required by this Agreement, and any other sums due City
from Concessionaire under this Agreement have been paid in full or deducted therefrom.
5. Unless specifically stated otherwise in this Agreement, all Fees or other charges required to be
paid by Concessionaire pursuant to this Agreement shall be due and payable as indicated herein,
and shall incur a late charge if not received within ten (10) calendar days after Concessionaire's
receipt of written notice of such default. In the event Concessionaire fails to pay any monthly
installment of Fees within ten (10) calendar days after Concessionaire's receipt of written notice of
such default,then Concessionaire shall pay a late charge of five percent (5%)of the amount in default as
liquidated damages for failure to make prompt payment. The parties agree that such late charge
represents a fair and reasonable estimate of the costs and expenses City will incur by reason of late
payment by Concessionaire. Acceptance of such late charge by City shall in no event constitute a
waiver of Concessionaire's default with respect to such overdue amount, nor prevent City from
exercising any of the other rights and remedies granted in this Agreement. In the event Concessionaire
pays the late charge set forth hereunder but fails to pay contemporaneously therewith all unpaid
amounts of Fees, City's acceptance of this late charge payment shall not constitute a waiver of
Concessionaire's default with respect to Concessionaire's nonpayment nor prevent City from
exercising all other rights and remedies available to City under this Agreement,at law or in equity.
5.03 Good Faith Administration
Concessionaire shall not use any system, method, practice, or technique that results in, or is
designed to circumvent or shift the Concessionaire's Percentage Fee obligation under this Agreement.
The final determination on this issue shall be at the discretion of the City Manager. Examples include,
without limitation: (a) Concessionaire must equally distribute Gross Revenues among displays of
differing percentage rents when selling packages; (b) any cost based exclusions from Gross Revenue
are for the actual costs of providing a service or product, costs that are actually passed along to a third
party, and costs that are not typical business overhead in nature; Concessionaire shall not trade,borrow,
barter, or engage in any marketing practice or device that diminishes gross revenues from the Program
except as expressly authorized under this Agreement or as otherwise approved by the City Manager.
5.04 Adequate Consideration
It is expressly understood and agreed that City does not consider the Minimum Annual
Guarantee in itself a fair and adequate rate for the Assigned Areas and would not have entered into this
Agreement unless Concessionaire had obligated itself to pay Percentage Fee, which City expects to
supplement the Minimum Annual Guarantee to provide a fair and adequate return. Therefore, if
Concessionaire fails to continuously operate its business in accordance with the terms of this
Agreement or vacates the Assigned Areas prior to the expiration of the Term hereof, City will suffer
10 19
?^_0669.1
damages and City shall have the right to treat any of such events as a material default and breach of this
Agreement and to recover such damages.
5.05 Concessionaire's Tax Obligation
Concessionaire shall be responsible for all taxes lawfully assessed against
Concessionaire's operations at the including, but not limited to any personal property taxes levied or
assessed on Concessionaire's personal property.
5.06 Concessionaire's Payment Obligations
1. In the event that Concessionaire disputes any Fees or other charge due hereunder, Concessionaire
shall notify City of such dispute prior to the due date for such payment. In the event that the City does
not agree with the disputed amount or if a period of more than 30 days is required to investigate such
dispute, the Concessionaire shall place such amounts in a separate escrow account for the mutual
benefit of Concessionaire and the City until such dispute can be resolved and no late charges or
interest shall be assessed on such amounts if the dispute is resolved in Concessionaire's
favor.
2. Payment by Concessionaire or receipt by the City of a lesser amount than the Fees or other
charges herein stipulated shall be deemed to be on account of the earliest Fees or other charges
due from Concessionaire to the City. No endorsements or statement on any check or any letter
accompanying any check or payment as Fees or other charges shall be deemed an accord and
satisfaction, and the City shall accept such check or payment without prejudice to the City's right to
recover the balance of any and all Fees or other charges due from Concessionaire to the City or to
pursue any other remedy provided in this Agreement or by law.
3. City may, at its option and its sole discretion, apply any payments received from Concessionaire
to any Fees, or other charges which are then due and payable. If City shall not make any specific
application of a payment received from Concessionaire, then any payment received from
Concessionaire shall be applied first to the other charge, then to the Fee which has been overdue for the
longest period of time. No designation of any payment by Concessionaire for application to a specific portion
of Concessionaire's financial obligations hereunder shall be binding upon City. Any sums received by
City after termination of this Agreement shall not constitute a Fee but shall be received only as
reimbursement for use and occupancy of the Assigned Areas.
4. At any time that Concessionaire has either failed to pay Fees or other charges within five (5)
days after the same shall be due or shall have delivered checks to City for payments pursuant to this
Agreement which shall have on at least three (3) occasions during the Term of this Agreement (whether
consecutive or not or whether involving the same check or different checks) been returned by CiWs bank
for any reason, City shall not be obligated to accept any payment from Concessionaire unless such
payment is made by cashier's check or in bank certified funds.
5.07 Performance Bond
To secure the faithful performance of its obligations under this Agreement, Concessionaire shall
provide security in the form of a performance bond or a letter of credit or such other form as the City Attorney
may approve in the amount of Three Hundred Thousand Dollars ($300,000.00) through January 31, 2016.
Such security shall be issued by a surety or financial institution authorized to do business in the State of
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California and shall be approved by the City Attorney.
Article 6
Construction of Assigned Areas
6.01 Condition of Assigned Areas
Concessionaire's taking possession of the Assigned Areas shall constitute
Concessionaire's formal acceptance of the same and acknowledgment that the Assigned
Areas are in satisfactory condition, subject to all field conditions existing at the time of
delivery of possession.
6.02 bprovements by Concessionaire
Concessionaire shall, without cost to City, provide the Assigned Areas with all
improvements necessary for the customary operation of the Concession in a first class manner, as
set forth in Exhibit A to this Agreement, and as listed here:
1. All structural improvements, equipment, and interior design and decor constructed or
installed by Concessionaire, its agents, or contractors, including the plans and specifications, shall
conform to all applicable statutes, ordinances, building codes, and rules and regulations. Final
construction design and/or "shop drawings" of all fixtures, displays, and improvements shall be
submitted to the City Manager for review and approval prior to installation.
2. No structural installations or improvements shall be made to or upon the Assigned
Areas without the prior written approval of the City Manager, which approval may be withheld for
any reason.
3. Concessionaire will not make any alterations, additions, or improvements to the Assigned
Areas or any structures thereon, without first obtaining the City Manager's written consent.
Concessionaire will obtain City Manager review and written approval before proceeding with
any improvements. Concessionaire shall also be responsible for any damage to persons or
property that may occur as a result of making any improvements. Any alterations, additions, or
improvements to the Assigned Areas will be made by Concessionaire at Concessionaire's sole
cost and expense according to plans and specifications approved by the City Manager.
4. All improvements made by Concessionaire to Assigned Areas shall be of high quality.
Furthermore, they shall be safe, fire resistant, attractive in appearance, and shall require written
approval of the City Manager prior to installation.
5. Concessionaire shall submit to the City a schedule depicting the estimated time required to
complete the construction or installation of approved improvements, facilities, furniture, and
equipment for the Concession. All work shall be frilly completed within 165 days of City approval.
12 2 !
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6. Within One Hundred and Twenty(120) days of completion of construction, Concessionaire shall
provide to City Manager. (1) one reproducible final copy of plans for all improvements or subsequent
changes therein or alterations thereof to the Assigned Areas, signed by Concessionaire; (2) a signed
statement from the construction contractor(s), architect(s) and engineer(s) specifying the total
construction cost;(3)a signed statement that the improvements have been constructed in accordance with the
approved plans and specifications, and in strict compliance with all applicable building codes, laws,
rules, ordinances and regulations; and (4) a signed statement demonstrating that no liens exist on any or
all of the construction. If the total construction cost is less than the Minimum Capital Investment, the
difference shall be paid to City within one hundred and twenty (120) days after the completion of all
construction as described in Exhibit A to this Agreement.
7. All Fixed Improvements made to the Assigned Areas and additions and alterations
thereto made to the Assigned Areas by Concessionaire shall be and remain the property of
Concessionaire until the expiration of the term of this Agreement,or upon termination of this Agreement
(whether by expiration of the term, cancellation, forfeiture,or otherwise, whichever first occurs); at which
time the said improvements shall become the property of City free and unencumbered, provided
however, that any trade fixtures, signs, and other personal property of Concessionaire not
permanently affixed to Assigned Areas shall remain the property of Concessionaire, unless
Concessionaire shall fail within ten (10) days following the termination of this Agreement, to remove
such facilities in which event, at the option of City Manager, title to same shall vest in City at no cost to
City or the City Manager may elect to exercise City rights set forth in this Agreement. With respect to
any wall or other wraps and any artwork, graphics, posters, or other collateral advertising material
owned by advertisers, advertisers shall have the right to elect to retain ownership of such materials and
remove them at their expense.
8. City Manager shall retain the ultimate control over the quality and acceptability of the finishes in
the Assigned Areas, and all improvements and finishes shall require the written approval of the City
Manager prior to installation. The architectural/engineering firm utilized by Concessionaire shall be
approved by the City Manager.
9. Concessionaire agrees to expend the full "Minimum Capital Investment" in the
modification, furnishing, and equipping of the Assigned Areas for the capital improvements related
to the Program not later than 120 days after final completion. The improvements shall become the
property of the Airport at the end of the contract term.
10. Concessionaire shall not remove or demolish, in whole or in part, any improvements upon
the Assigned Areas(excluding advertising copy)without the prior written consent of the City Manager, which
may be conditioned upon the obligation of Concessionaire to replace the same by an improvement
specified in such consent. The City Manager shall not withhold consent unreasonably, shall not
impose unreasonable conditions,and shall state the reasons for withholding consent.
Article 7
Concession Operations
7.01 Operational Standards
1. The management, maintenance and operation of the Assigned Areas shall be under the
supervision and direction of an active, qualified, competent manager who shall be subject to the
direction and control of Concessionaire. The Concessionaire agrees that its employees and
contractors shall be of sufficient number so as to properly conduct the Concessionaire's
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operation. A representative of Concessionaire shall be available by telephone twenty-four hours
a day, seven days a week, and three hundred sixty five days a year in case of emergency.
2. The operations of Concessionaire, its employees, agents, suppliers and contractors shall
be conducted in an orderly and proper manner, including all maintenance and cleaning of
advertising displays. All advertising shall be in compliance with all applicable federal, state and
local laws and regulations, including, but not limited to, laws and regulations intended to protect
the interest of consumers and the general public.
3. Concessionaire agrees that at least ten percent (10%) of the advertising capacity of the
Program shall be reserved for and dedicated to advertising City marketing and tourism
information and services, including without limitation the Palm Springs Convention Center and
the Palm Springs Bureau of Tourism, approved by the City Manager, and at no cost to the City
other than costs of production which will be paid by the City.
a. Exhibit A designates locations which are reserved for the City of Palm Springs
self-promotion. These locations shall be utilized for City branding messages
which highlight City-owned assets, City events, and/or the Palm Springs lifestyle.
Messages will be group welcome related, Airport related, or Airport directed
information and promotions. City of Palm Springs advertising must not promote
private businesses, corporations, events or organizations which would otherwise
pay for advertising in the airport. Convention Center advertising is allowed for
City supported organizations and events.
b. Advertising locations designated for the City of Palm Springs may be sold by
Corey Airport Services to paying advertisers or switched to other locations if
deemed in the City's best interest by the City Manager.
C. Corey Airport Services are not responsible for printing production or installation
of any City of Palm Springs static advertising displays.
d. Corey Airport Services are responsible for posting and removing all digital
advertising for the City of Palm Springs.
e. Corey Airport Services are responsible for the installation and maintenance of the
display cases to be used by the City of Palm Springs.
4. Concessionaire shall use its best efforts and sound business practices to keep all
advertising displays fully occupied with revenue producing advertising. Under no circumstances
shall Concessionaire allow an advertising display to remain vacant or dark for more than forty-
eight (48) hours. Concessionaire will produce and maintain a supply of "fillers" at
Concessionaire's sole cost and expense. All "filler" advertising shall be subject to prior approval
of the City Manager and shall be kept fresh and current. Subject to the City Manager's prior
written approval and the Advertising Guidelines, Concessionaire may install and maintain
appropriate and attractive advertising in vacant advertising displays providing City sponsored
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activities or events, City marketing and tourism information or services, local community events
or services, public service announcements, information regarding local non-profit organizations,
or other similar public information. Under no circumstances shall such advertisement include
controversial social, moral, political or ethical content or messages. Concessionaire shall also
offer vacant advertising displays to the City for advertising and promoting the Airport or Airport
programs. Advertisements installed pursuant to this section are intended to be short-term and
temporary in nature until such time revenue generating advertising can be secured for the
location.
5. Notwithstanding any provision of this Agreement to the contrary, Concessionaire
understands and agrees that, in the event of a conflict between Concessionaire and any other
lessee or concessionaire in the Airport as to specific items to be sold or services to be provided,
the City Manager shall make the final determination as to which product or service may be sold
or provided by each concessionaire or lessee.
6. Any Hazardous Materials used or brought onto the Assigned Areas by the Concessionaire
shall be handled, stored, transported, and disposed of in strict accordance with all applicable
federal, state, and local statutes, ordinances, and regulations. Concessionaire shall promptly
respond to and clean up any released or threatened release of any Hazardous Material into the drainage
systems, soils, groundwater, waters or atmosphere, in a safe manner, in accordance with applicable
federal, state, and local statutes,ordinances,and regulations, and as authorized or approved by all federal,
state or local agencies having authority to regulate the permitting, handling and cleanup of
Hazardous Materials. The City Manager shall be notified immediately of any release or threatened
release of any Hazardous Material.
7.02 Operational Standards and Evaluation by City
Concessionaire shall operate the Concession in accordance with the terms of this Agreement
and the standards set forth in the Program.
7.03 Maintenance and Utilities
1. The Concessionaire shall provide at its own expense such janitorial and cleaning
services and supplies as may be necessary in the operation and maintenance of the Assigned
Areas. The Concessionaire also agrees to keep and maintain the Assigned Areas in a clean, neat
and sanitary condition, and attractive in appearance.
2. The Concessionaire agrees to maintain and make necessary general repairs to all existing
advertising equipment and fixtures, fixtures and equipment placed or installed in the Assigned
Areas by Concessionaire, including, without limitation, signs, showcases, displays, all pay
telephones and telephone boards. Concessionaire agrees to keep and maintain in good condition
the electrical equipment located at or on the Assigned Areas. All repairs done by the
Concessionaire or on its behalf shall be of first class quality in both materials and workmanship.
All repairs shall be made in conformity with the rules and regulations prescribed from time to
time by federal, state or local authority having jurisdiction over the work in the Concessionaire's
Assigned Areas. The City Manager shall be the sole judge of the quality of maintenance of the
advertising displays. If it is determined that such maintenance is not satisfactory, the City
Manager shall so notify Concessionaire in writing. If such maintenance is not performed to City
standards by the Concessionaire within seventy-two (72) hours after receipt of written notice,
the City or its agents thereafter shall have the right to perform the maintenance thereof and
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Concessionaire agrees to promptly reimburse the City for the cost thereof, plus a fifteen percent
(15%) administrative overhead fee.
3. The Concessionaire shall, in a timely manner, provide for the adequate sanitary handling
and removal of all trash, garbage, and other refuse caused as result of the Concessionaire's
operations.
4. The City shall have the right to construct or install over, in, under or through the
Assigned Areas new lines, pipes, mains, wires, conduits and equipment; provided, however, that
such repair, alteration, replacement or construction shall not unreasonably interfere with
Concessionaire's use of the Assigned Areas. The City will repair at its sole costs, any damage
to Concessionaire property resulting from such activities.
5. Concessionaire shall be responsible for making all utility connections required for
operation of its advertising displays at Concessionaire's sole cost and expense. The City shall
be responsible and pay for monthly utility billing required, used or consumed in the Assigned
Areas, including but not limited to electric, gas, telephone, garbage collection services and data
and cable utility services, that are over and above the amount paid by Concessionaire in Article
3.03 (3).
6. The City shall not be liable for any interruptions to the utility services provided at the
Airport or to the advertising displays.
7.04 City Access
The City shall have the right to enter Concessionaire's Assigned Areas to:
a. Inspect Assigned Areas at reasonable intervals during Concessionaire's regular business
hours or at any time in case of emergency,to determine whether Concessionaire
has complied with and is complying with the terms and conditions of this
Agreement, and may require Concessionaire to perform necessary repairs at
Concessionaire's own cost.
b. Perform any and all things that Concessionaire is obligated to perform and has failed
after reasonable notice to do, including: maintenance, repass and replacements to
Concessionaire's Assigned Areas. The cost of all labor and materials required to
complete the work will be paid'by Concessionaire to City within ten(10)days
following demand by the City Manager for said payment.
Article 8
Responsibility of the City
8.1 City Maintenance
The City shall provide finished floors, walls and ceilings for the Assigned Areas in an
"as-is" condition. The City shall be responsible for the providing of, maintenance of, and upkeep
of partitions about the perimeter of the Assigned Areas, structural walls and supports, structural
roof construction, structural floor construction, exterior window walls designed about the
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perimeter of the Assigned Areas, and Airport security. The City shall further be responsible for
the general maintenance and upkeep of the Airport outside of Concessionaire's Assigned Areas.
Article 9
Defaults of Concessionaire and Termination by the City
9.01 General
Each of the following events shall constitute a"Default"or"Event of Default":
1. Any failure of Concessionaire to pay any Guaranteed Fee, Percentage Fee or any other fees,
charges or sums whatsoever due hereunder for more than ten(10)days after receipt of written notice from
City to Concessionaire that such amounts due hereunder were not received on the date required for payment
pursuant to this Agreement; or
2. If Concessionaire fails to remedy a default by it with respect to any of the other covenants,
conditions, and agreements contained in this Agreement, or in any rider, exhibit or other addendum
hereto, within thirty (30) days after notice has been sent; provided, however, that in the event of a
default which does not involve the payment of money and which cannot reasonably be cured within thirty
(30) days, Concessionaire shall not be in default of this Agreement. If Concessionaire (i) gives
written notice to City, within thirty (30) days after the notice of default has been sent, of
Concessionaire's intent to cure, and (ii) within such thirty(30) day period, delivers evidence to City of
the commencement of the cure,and(iii)diligently and in good faith continues said cure;and(iv)completes said
cure expeditiously,or
3. IfCa>cessionaueabandons or vacates the Assigned Areas or ceases to oorduet its business therein for a period
of ten (10) consecutive days; or the occurrence of any act by or within the control of the Concessionaire which
operates to deprive the Concessionaire of the now.,powers and privileges necessary for the proper conduct of the
amcession;or
4. If the Concessionaire allows any interior static advatisuig display to remain anpty and blank for a period
longer than ten(10)days after receipt ofwritten notice from the City Manager: or
5. Any assignment of the Concessionaire's interest in this Agreement without the prior written approval of
the City Manages;or
6. The failure of the Concessionaire to perform,keep or observe any of the terms, covenants and obligations
lmderthis Agreement and the failure continues for tar(10)days after written notice by the City of such failure;or
7. If Concessionaire shall (1) apply for or consent to the appointment of or the taking of possession by a
receiver,liquidator,custodian or trustee of itself or of all or a substantial part of its property, (ii)admit in writing its
inability, or be generally unable,to pay its debts as such debts become due, (m)make a general assignment for the
benefit of its aeditors, (iv)oommence a voluntary case under the Federal Bmkruptcy Code(as now or hereafter in
effect),(v)file a petition seeking to take advantage of any other law relating to bankruptcy,insolvency,reorganization,
winding-up,or composition or adjustment of debts, or(vi)take any action for the purpose of effecting any of
the foregoing;or
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8. Ifa proceeding or case shall be commenced,withal the application or oorscrrt ofConeessionaire,in any court
of competent jurisdiction, seeking (i) liquidation, reorganization, dissolution, winding-up, or composition or
adjustment of debts,(ii)the appointment of a trustee,receiver,liquidator,custodian or the like of Concessionaire
or of all or any substantial part of its assets, or(iii) similar relief urxler any law relating to bankruptcy,insolvency,
reorganization,winding-up,or oomposition or adjustment ofdebts,and Concessionaire fails to wntrovert such action or
proceeding in a timely and appropriate manna, or an order,judgment or decree approving or ordering any of the
foregoing shall be entered and continued unsta}red and in effect, for a period of ninety(90)days;or any order for
relief against Concessionaire shall be entered in an involuntary case under such Bankruptcy Code;or
9. Any representation by Concessionaire,or in any report,certificate,financial statement,or other instrument
including this Agreement or any Exhibit that the City Manager determines is false, misleading, or incorrect
in any material respect as of the date made.
9.02 City Rights upon Default
1. Upon the occurrence of a Default,the City Manager may at the City Manager's sole discretion,in
addition to any other right or rights which City may have, serve a written thirty (30) days' notice of
cancellation of this Agreement upon Concessionaire, and upon the expiration of said thirty (30) days,
unless the Event of Default has been cured or a cure has been reasonably commenced and is
diligently prosecuted by Concessionaire, this Agreement shall terminate and Concessionaire shall quit
and surrender the Assigned Areas to City. In case of any such Default
a. All Guaranteed Fee and Percentage Fee and other sums then to be paid by
Concessionaire pursuant to this Agreement shall become due thereupon and be paid up
to the time of such re-entry, dispossession and/or expiration, together with such
reasonable expenses as the City may incur for legal expenses, attorneys' fees,
brokerage,and/or putting the Assigned Areas in good order.
b. The City-may re-assign the Assigned Areas or any part or parts thereof, either in the
name of City or otherwise, for a term or terms, which may at City's option be less than or
exceed the period which would otherwise have constituted the balance of the Term and
may grant concessions or free of fees.
C. Concessionaire or the legal representatives of Concessionaire shall also pay the
City as liquidated damages for the failure of Concessionaire to observe and perform
Concessionaire's covenants herein contained, any deficiency between the Guarantee
Fee and Percentage Fee and other sums hereby reserved and/or covenanted to be paid
and the net amount, if any, of the fees collected on account of the new concession or
assignment of the Assigned Areas for each month of the period which would
otherwise have constituted the balance of the Term. In computing such damages there
shall be added to the deficiency such reasonable expenses as City may incur in
connection with reassigning, such as legal expenses, attorneys' fees, brokerage and for
keeping the Assigned Areas in good order. The City, at City's option, may make such
alterations,repairs,decorations and replacements as are reasonably necessary or desirable
for the purpose of reassigning the Assigned Areas; and the making of such alterations
and/or decorations shall not operate or be construed to release Concessionaire from
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liability hereunder as aforesaid.
d. The foregoing remedies and rights of City are cumulative and in addition to any
remedies the City may have in the enforcement of this Agreement. Concessionaire
expressly waives any and all rights of redemption granted by or under any present or
future laws in the event of Concessionaire's eviction or dispossession for any cause.
2. The CityManager may allow this Agreement to continue in effect, for so long as City
g Y Sr
does not terminate this Agreement and Concessionaire's right to possession of the Assigned
Areas, in which event City shall have the right to enforce all of City's rights and remedies under this
Agreement including the right to recover the Guaranteed Fee, Percentage Fee, and any additional fee
and other charges payable by Concessionaire under this Agreement as they become due under this
Agreement.
9.03 Termination for Convenience.
The City may terminate this Agreement for its convenience at any time, in whole or in
part, by giving Concessionaire written notice thereof specifying the extent of the termination and
its effective date. In the event this agreement is terminated solely for Convenience pursuant to
this section 10.03, City shall reimburse Concessionaire for the unamortized depreciation amount of the
Minimum Capital Investment, if any, at the termination of this Agreement and an Inconvenience Fee in the
amount of Two Hundred and Fifty Thousand Dollars ($200,000.00). The depreciation method shall be
based on a five year straight line depreciation schedule. In no case shall Concessionaire be entitled
to anticipatory profits or consequential damages except as expressly provided in this Section 9.03
and Concessionaire shall have no further claims against City under this Agreement.
9.04 Right of City to Lien
The right to lien on the inventory and other property of the Concessionaire is expressly granted
to the City in any case where the Concessionaire fails to pay amounts due to the City under this
Agreement.
9.05 No City Liability for Damage
The City shall not be liable for any damage, including, but not limited to, loss of profit, and
the Concessionaire shall not make a claim of any kind whatsoever against the City, its agents or
representatives,by reason of any action taken pursuant to this Article other than damages arising from
the negligence or willful misconduct of the City, its employees or agents.
Article 10
Bankruptcy or Insolvency
10.01 Concessionaire's Interest Not Transferable
Neither Concessionaire's interest in this Agreement, nor any estate hereby created in
Concessionaire nor any interest herein or therein, shall pass to any trustee or receiver or assignee for
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the benefit of creditors or otherwise by operation of law except as may specifically be provided
pursuant to the United States Bankruptcy Code, as amended. In the event the Concessionaire enters
into proceedings relating to bankruptcy, whether voluntary or involuntary, the Concessionaire
agrees to furnish, by certified mail or electronic commerce method authorized by the Agreement,
written notification of the bankruptcy to the City Manager. This notification shall be furnished
within five (5) days of the initiation of the proceedings relating to bankruptcy filing. This
notification shall include the date on which the bankruptcy petition was filed, the identity of the
court in which the bankruptcy petition was filed, and a listing of City contract numbers for all
City contracts against which final payment has not been made. This obligation remains in effect
until final payment of net receipts under this Agreement has been made to the City.
10.02 Termination
In the event the interest or estate created in Concessionaire hereby shall be taken in execution
or by other process of law, or if Concessionaire's guarantor, if any, or its executors, administrators, or
assigns, if any, shall be adjudicated insolvent or bankrupt pursuant to the provisions of any state act or the
Code or if Concessionaire is adjudicated insolvent by a court of competent jurisdiction other than the
United States Bankruptcy Court, or if a receiver or trustee of the property of Concessionaire or
Concessionaire's guarantor, if any, shall be appointed by reason of the insolvency or inability of
Concessionaire or Concessionaire's guarantor, if any, to pay its debts as the same become due or if any
assignment shall be made of the property of Concessionaire or Concessionaire's guarantor, if any,
for the benefit of creditors, then City shall have the right to elect,by written notice to Concessionaire,to
terminate this Agreement and all rights of Concessionaire hereunder, and Concessionaire shall vacate
and surrender the Assigned Areas but shall remain liable as herein provided.
10.03 Concessionaire's Obligation to Avoid Creditors'Proceedings
Concessionaire or Concessionaire's guarantor, if any, shall not cause or give cause for
the appointment of a trustee or receiver of the assets of Concessionaire or Concessionaire's
guarantor, if any, and shall not make any assignment for the benefit of creditors, or become or be
adjudicated insolvent. The allowance of any petition under insolvency law except under the
Code or the appointment of a trustee or receiver of Concessionaire or Concessionaire's
guarantor, if any, or of the assets of either of them, shall be conclusive evidence that
Concessionaire caused, or gave cause for the appointment of a trustee or receiver of the assets
of Concessionaire therefore, unless such allowance of the petition, or the appointment of a
trustee or receiver, is vacated within sixty (60) days after such allowance or appointment.
Any act or occurrence described in this Section shall be deemed a material breach of
Concessionaire's obligations hereunder, and providing City with the right to elect by written notice
to Concessionaire to terminate this Agreement and all rights of Concessionaire hereunder, and
Concessionaire shall vacate and surrender the Assigned Areas but shall remain liable as herein
provided. City does, in addition, reserve any and all other remedies provided in this
Agreement or by law.
Article 11
Cancellation by Concessionaire
The Concessionaire, in addition to any other right of cancellation herein given to the
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Concessionaire by the City or any other rights to which Concessionaire may be entitled by law or
otherwise, may cancel this Agreement at any time that the Concessionaire is not in default in its
payments to the City hereunder, by giving the City Manager sixty (60) days written notice to be
served as hereinafter provided, upon or after the happening of any one of the following events:
a. Issuance by any court of competent jurisdiction of an injunction in any way
preventing or restraining the use of the Airport or any part thereof for Airport
purposes, which injunction materially affects Concessionaire's operations at the
Airport;
b. The inability of Concessionaire to use the Airport or any of the premises,
facilities, rights, licenses, services or privileges granted to the Concessionaire
hereunder because of any law or any order, rule, regulation or other action or any
non-action of the Federal Aviation Administration or any other governmental
authority, or because of fire, earthquake, other casualty or acts of God, or the
public enemy, which materially affects Concessionaire's operations at the Airport.
C. The default by the City in the performance of any covenant or agreement herein
required to be performed by the City and the failure of the City to remedy such
default for a period of thirty (30) days after receipt from the Concessionaire of
written notice to remedy the same; provided, however, that no notice of
cancellation as above provided shall be of any force or effect if the City shall
remedy the default prior to receipt of the Concessionaire's notice of cancellation.
Article 12
Laws,Remlations and Compliance
12.01 Laws and Regulations
ations
The Concessionaire covenants and agrees that it will fully comply with all laws,
ordinances, rules and regulations for the City, the State of California, and the United States
applicable to, related to, or touching upon Concessionaire's operations within and upon the
Facilities or elsewhere at the Airport and expressly agrees that its use of and activities upon the
Airport shall be subject to all such ordinances, rules and regulations. The Concessionaire shall
furnish all licenses, permits and authorizations required for the management and operation of the
Facilities authorized herein.
12.02 Safety and Fire Re lgu ation
The Concessionaire shall conduct its operations and activities under this
Agreement in compliance with all safety regulations and directives of the City and applicable
Federal, state and local laws. The Concessionaire shall procure and maintain such fire
prevention and extinguishing devices as required by the authority and shall at all times be
familiar with and comply with the fire regulations and orders of the City.
12.03 Airport Security
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Concessionaire shall observe all security requirements of Federal Aviation
Regulation Part 139 and Transportation Security Regulations Parts 1500, 1520, and 1542
applicable parts, as, the same may be from time to time amended, and to take such steps as
may be necessary or directed by City to ensure that subcontractors, employees, invitees, and
guests observe these requirements. If City incurs any fines and/or penalties imposed by the
Federal Aviation Administration or Transportation Security Administration or any expense in
enforcing said regulations and the City's Airport Security Program, as a result of the acts or
omissions of Concessionaire, Concessionaire agrees to pay and/or reimburse all such costs and
expense. Concessionaire further agrees to rectify any security deficiency as may be
determined as such by the City or the Federal Aviation Administration or the Transportation
Security Administration. City reserves the right to take whatever action is necessary to
rectify any such security deficiency in the event Concessionaire fails to remedy same.
12.04 City Issuance of Rules and Regulations
The City Manager shall have the right to prescribe, in its sole discretion, such
reasonable rules and regulations which in the City Manager's reasonable judgment are
necessary or appropriate for the general well being, safety, care, and cleanliness of the Airport.
12.05 Compliance by Other Concessionaires and Concessionaires
The City Manager shall, whenever possible, make reasonable efforts to obtain
uniform compliance with the City's rules and regulations; however, the City shall not be
liable to the Concessionaire for any violation or non-observance of such rules and regulations
by any user, tenant, concessionaire, invitee, licensee, or trespasser at the Airport nor shall such
violation or non-observance by a user, tenant concessionaire, invitee, licensee, or trespasser
at the Airport, constitute a waiver of the Concessionaire's obligation to comply with City rules
and regulations.
12.06 Notification of Theft or Damage
The Concessionaire shall inform the City Manager, in writing, within twenty-four (24) hours
after the Concessionaire becomes aware of any damage to or alleged theft of City property or private
property.
Article 13
Indemnification and Insurance
13.01 Damage Caused by the Concessionaire
All damage to the Assigned Areas or to the Airport in any way caused by the
Concessionaire or its agents,employees,conhacm visitors,guests or invitees,shall be repaired at the expense of
the Concessionaire. In the event of such damage, the City shall have the option to make such repairs as are
necessary,and any charge,costs,or damages so incurred by the City shall be paid by the Concessionaire.
13.02 Indemnification-General
22 3 I
710669.1
The Concessionaire shall defend, indemnify, and hold the City and its officers, employees and
agents completely harmless from and against any and all claims, suits, demands, actions, liabilities, losses,
damages,judgments,or fines arising by reason of injury or death of any person,or damage to any property,
including all reasonable costs for investigation and defense thereof(including, but not limited to, attorney
fees, court costs and expert fees) of any nature whatsoever arising out of the Concessionaire's conduct of its
business on the Airport,or in its use ofoaagpancy ofthe Assigned Areas,regardless of where the injury,death,or
damage may occur, except to the extent such injury, death, or damage is caused City's sole negligence or
willful conduct or that of its officers,employees,or agents.
13.03 Indemnification- Violation of Laws.
The Concessionaire shall defend, indemnify, and hold the City, and its agents, officers, and
employees, completely harmless from and against any claim, suit, demand, action, liability, loss, damage,
judgment, fine, or civil penalty and all costs and expenses of whatever kind or nature (including, but not
limited to, attorney fees, court costs and expert fees) associated therewith in any way arising from or
based upon the violation of any Federal, state, or municipal laws, statutes, resolutions, or regulations
by the Concessionaire, its agents, employees, subcontractors, or sublessees, in conjunction with the
Concessionaire's use and/or occupancy of the Airport. The City shall give the Concessionaire
reasonable notice of and an opportunity to defend against,any such claims or actions, and the City shall
take reasonable actions to mitigate its damages.
13.04 Indemnification- Airport Security
If the City is deemed to be in noncompliance with laws or regulations governing access to
secure areas of the Airport and to the areas of the airfield and said noncompliance is the result of or due
to the negligence or willful act or omission of the Concessionaire or of any of the Concessionaire's
employees, agents, subcontractors, or sublessees and such breach results in a civil penalty action
against the City, the Concessionaire agrees to reimburse the City for all expenses, including reasonable
attomey fees incurred by the City in defending against the civil penalty action and for any civil
penalty or settlement amount paid by the City as a result of the civil penalty action. The City shall
give the Concessionaire reasonable notice of any allegation, investigation, or proposed or actual
civil penalty which relates to acts or omissions of the Concessionaire.
13.05 Survival of Indemnification
The provisions of Sections 13.02, 13.03, and 13.04 shall survive the expiration, termination, or
early cancellation of this Agreement for claims, suits, demands, actions, liabilities, loss, or damage,
which occur prior to the termination or early cancellation of this Agreement.
13.06 Insurance.
1. Concessionaire shall procure and maintain, at its cost, and submit concurrently with its
execution of this Agreement, public liability and property damage insurance against all claims
for injuries against persons or damages to property resulting from Concessionaire's performance
under this Agreement. Concessionaire shall also carry workers' compensation insurance in
accordance with California's workers compensation laws. Such insurance shall be kept in effect
during the term of this Agreement and shall not be cancelable without thirty (30) days written
23 Revised: 6/16/10 32
7?06G9.1
notice to City Manager of any proposed cancellation. City's certificate evidencing the foregoing
and designating City as an additional named insured shall be delivered to and approved by City's
Risk Manager prior to commencement of the services hereunder. The procuring of such
insurance and the delivery of policies or certificates evidencing the same shall not be construed
as a limitation of Concessionaire's obligation to indemnify City, its contractors, officers and
employees.
2. Comprehensive or Commercial Form General Liability Insurance shall include the
following minimal limits:
a. General Liability including operations, products and completed operations
$1,000,000 each occurrence for bodily injury, personal injury and property
damage/$2,000,000 aggregate
b. Automobile, $1,000, 000 each accident; $1,000,000 uninsured motorist
C. Workers Compensation, $1,000,000 each accident/$1,000,000 each employee for
disease.
d. Excess Liability/Umbrella Form, $2,000,000.
3. Insurance policies carried by Concessionaire shall be with a company admitted to write
insurance in California that has a current A.M. Best rating of not less than B++:VIII or with a
non-admitted insurer on California's List of Eligible Surplus Lines of Insurers that has a current
A.M. Best rating of not less that A-;X. All insurance certificates verifying insurance coverage
and endorsements shall be provided to the City a minimum of five days prior to the
Commencement Date of this Agreement.
4. An Additional Insured Endorsement is required for the General Liability Insurance
policy naming the City, its officers, employees, and agents as additional insureds on the policy.
5. The policies shall provide for a 30 day notice to the City prior to termination,
cancellation, or change.
6. The general liability and excess liability/umbrella policies must be endorsed to provide
that each policy shall apply on a primary and noncontributing basis in relation to any insurance
or self-insurance, primary or excess, maintained by or available to the City or its officials,
employees, and agents.
7. The Workers Compensation policy shall contain the insurer's waiver of subrogation (or
waiver of right of recovery) in favor of City, its elected officials, officers, employees, and
agents.
8. If, in the City's opinion, the minimum limits of the insurance herein required have
become inadequate during the period of this Agreement, the Concessionaire shall increase
such minimum limits by reasonable amounts on request of the City provided that said coverage
is available at standard commercial rates.
24 33
720669.1
Article 14
Gross Revenues Reports
14.01 Certified Statements
Concessionaire shall submit to the City Manager not later than the twentieth day of each calendar
month during the Term of this Agreement, or at such other intervals as specified herein, a certified
statement setting forth the Concessionaire's Gross Revenues for the preceding calendar month. Said
statement shall be in the format specified by the City Manager, shall include all information required by
the City Manager including, without limitation, separate total sales by location and shall be certified as
complete and correct by the Concessionaire's principal financial officer. Within ninety (90) days after
the expiration of each Agreement Year, the Concessionaire shall submit to the City Manager an annual
certified statement showing the amount of Gross Revenues and itemized exclusions therefrom for the
Agreement Year certified by the Chief Financial Officer of the Concessionaire and a like annual
certified and complete statement from a Certified Public Accountant which includes an opinion that the
fees paid by Concessionaire to the city during the preceding agreement year were made in accordance
with the terms of this Agreement. Such certification does not affect the City's audit rights or supersede
any City audit findings and such statement shall be in the format specified by the City Manager.
Article 15
Records and Books:Inspections:Audilc
15.01 Maintenance of Books and Records
1. Concessionaire shall maintain full and accurate books of accounts and records from which
Gross Revenues can be determined. Concessionaire shall maintain adequate accounting records in
accordance with generally, accepted accounting principles, and generally accepted auditing standards and
the requirements of this Agreement, for: (i) all transactions relevant to this Agreement; and (ii) all
exclusions from Gross Revenue claimed by Concessionaire. The City Manager shall have the right at
all reasonable times to inspect and audit all such records as may be necessary to verify the reported
Gross Revenue,including State of California sales tax return records.
2. Books of accounts and records shall include detailed analysis listing all of
Concessionaire's operations at the Airport,or a result of its operation at the Airport in the form of printed,
written or electronic media. Books of accounts and records shall also include, but is not limited to: (i)
all original accounting source documents detailing transactions relevant to this Agreement, including
but not limited to: (a) original contacts, (b) monthly sales journals detailing each transaction for the
month, (c) reconciliations between the financial records and monthly reports submitted to the City, (d)
other sales related documents; and(e)all exclusions from Gross Revenue claimed by Concessionaire.
3. For exclusions or adjustments to Gross Revenue, the Records shall include, but are not
limited to: (a) all agreements between Concessionaire and corporate or volume customers establishing
the customers' contractual rights to rebates; (b) lists of all individual transactions with all
corporate or volume customers; (c) all individual agreements with all corporate or volume customers;
and(d)any documentation or records supporting additional reductions to Gross Revenue.
25 Revised: 6/16/10 34
720009.1
4. Concessionaire's books of accounts and records shall be segregated from other business matters
and records of other operations of the Concessionaire. Concessionaire's records for its operations at the
Airport shall be kept separate from other records and sequentially numbered for tracking. All books of
accounts and records and all other papers and files of the Concessionaire related to Gross Revenues and
capital under this Agreement shall be made available at the Airport within ten(10)days of Concessionaire's
receipt of the City's written request for such books and records with respect to advertising sales at the
airport.
5. In those situations where Concessionaire's sales records have been generated from
computerized data Concessionaire agrees to provide the City Manager or the City Manager's
representative with extracts of data files in a computer readable format in.E-mail with attached files,
or,surtable altemative.computer data exchange formats..
6. Records shall be so kept and maintained for at least five (5) years after the end of each
Agreement Year and at least three (3) years after the expiration or termination of this Agreement or in
the event of a claim by the City, until such claim of City has been fully ascertained, fixed and paid.
The foregoing books and records so required to be kept and maintained shall include without
limitation all records of daily bank deposits of the entire receipts from transactions on the Assigned
Areas and invoices.
15.02 Accounting Manager
Concessionaire shall provide the name and telephone number of Concessionaire's accounting
manager or the like who has a thorough knowledge of the accounting system as it pertains to this
Agreement and who will assist the City with its audit. Concessionaire will also allow interviews of
past and present employees who were involved in the financial or operational activities of
Concessionaire at reasonable times in cooperation with the Concessionaire.
15.03 Legal Fees
In the event that the City deems it necessary to utilize the services of internal or external legal
counsel in connection with collecting any amounts found due and owing by Concessionaire in an
audit, then Concessionaire shall reimburse the City for reasonable attorneys fees and litigation
expenses as part of the aforementioned costs incurred.
Article 16
Surrender of Occunancv
16.01 Surrender of Occupancy
When this Agreement expires or is terminated in whole or in part as provided for elsewhere in this
Agreement, the Concessionaire shall surrender the Assigned Areas and all Fixed Improvements therein
broom clean and in good condition and repair, with the exception of reasonable wear and tear and
damage by loss or casualty not covered by insurance which the Concessionaire is required to maintain
pursuant to this Agreement and not otherwise attributable to the Concessionaire's fault or negligence.
Article 17
7'0669.1 26 35
Changes&Additions to Airport; Impact of Construction Activities
17.01 Changes & Additions to Airport
1. The City reserves the right at any time, and from time to time, to make alterations to, and to
build additional retail stores in the terminal building at the Airport, and to construct other buildings and
improvements at the Airport, including any modifications of any common areas, to enlarge or reduce
the Airport, to add decks or elevated parking facilities, and to sell or lease any part of the land
comprising the Airport, for the construction thereon of a building or buildings which may or may not
be part of the Airport. The City reserves the right at any time to relocate, reduce, enlarge, or
reconfigure the various buildings,parking areas, and other common areas; provided,however,that any
such relocation, reduction, enlargement, or reconfiguration which adversely affects the Assigned Area
shall result in a downward adjustment of the Minimum Annual Guarantee or Percentage Fee,
whichever is applicable, in accordance with the impact on the exposure of the public to
Concessionaire's locations.
2. The City shall have the exclusive right to use all or any part of the roof of the Assigned Areas
for any purpose; to erect additional stories or other structures over all or any part of the Assigned
Areas; to erect in connection with the construction thereof temporary scaffolds and other aids to
construction on the exterior of the Assigned Areas, provided that access to the Assigned Areas shall
not be materially denied; and to install,maintain, use, repair and replace within the Assigned Areas
pipes, ducts, conduits, wires and all other mechanical equipment serving other parts of the Airport,
the same to be in locations as will not unreasonably deny Concessionaire's use thereof. The City may
make any use it desires of the side or rear walls of the Assigned Areas (including, without limitation,
freestanding columns and footings for all columns), and the City, at its expense, shall repair all damage
to the Assigned Areas resulting fivm such work.
17.02 Impact of Construction Activities
The Concessionaire recognizes that from time to time during the term of this Agreement it may
be necessary for the City to initiate and cant'forward extensive programs of construction reconstruction,
expansion, relocation, maintenance, and repair on the Airport, and that such construction,
reconstruction, expansion, relocation, maintenance, and repair may inconvenience or impair the
Concessionaire in its operation at the Airport. The Concessionaire agrees that no liability shall attach
to the City, its directors, officers, agents, employees, contractors, subcontractors, and representatives
by way of such inconveniences or impairment, and the Concessionaire waives any right to claim
damages or other consideration for such inconveniences or impairment provided however that the
Minimum Annual Guarantee shall be adjusted in accordance with the impact on exposure of the public
to Concessionaire's locations.
Article 18
Assignment and Subletting
18.01 Prohibition
1. Concessionaire shall not transfer or assign this Agreement or its interest in this Agreement or
subcontract its rights under this Agreement without the express written consent of the City, which will
not be unreasonably withheld.
27 Revised: 6/16/10 36
720669A
2. Transfers or assignments occurring by operation of law are also prohibited. Any attempted
transfer, assign, sublease (if applicable), license, or franchise, or equivalent shall be void and confer
no rights upon any third person. No assignment, subcontract, transfer, license, franchise, or equivalent
shall relieve Concessionaire of any obligations under this Agreement. The consent by the City to any
transfer, assignment, or subcontract shall not be deemed to be a waiver on the part of the City to
any prohibition against any future transfer, assignment,or subcontract.
18.02 Procedure for Transfer
Should Concessionaire desire to make a transfer hereunder, Concessionaire shall, in each
instance, give written notice of its intention to do so to City Manager at least ninety(90) days before
the intended effective date of any such proposed transfer, specifying in such notice whether
Concessionaire proposes to assign or sublet, or enter into license, franchise or concession
agreements, the proposed date thereof, and specifically identifying the proposed transferee, previous
business experience of the proposed transferee, including without limitation copies of the proposed
transferee's last two years' income statement,balance sheet and statement of changes in financial position
(with accompanying notes and disclosures of all material changes thereto) in audited form, if
available, and certified as accurate by the proposed transferee. Such notice shall be accompanied,in the
case of a proposed assignment, subletting, license, franchise or concession agreement, by a copy of the
proposed assignment, sublease, license, franchise or concession agreement or, if same is not available, a
letter of commitment or a letter of intent.
18.03 Required Documents and Fees
Each transfer to which City has consented shall be evidenced by a written instrument in form
satisfactory to City, executed by Concessionaire and the transferee, under which the transferee
shall agree in writing for the benefit of the City(except as otherwise agreed in writing by the City)
to assume, perform and abide by all of the term, covenants and conditions of this Agreement to be done,
kept and performed by Concessionaire, including the payment of all amounts due or to become due
under this Agreement directly to the City and the obligation to use the Assigned Areas only for the
purposes specified in this Agreement.Concessionaire shall reimburse the City's reasonable attomeys' and
administrative fees incurred in the processing of,and documentation for,each such requested transfer,not
to exceed$500,whether or not the transfer is consummated.
18.04 Transfers
The term "transfer" includes, but is not limited to, transactions after the
commencement date in which the Concessionaire sublets, rents or otherwise permits occupancy or
use of the Assigned Areas by a third party.
18.05 Consent
If the City consents to any transfer, assignment or subcontract, that consent shall not be
effective unless and until Concessionaire gives notice of the transfer or assignment and a copy of the
transfer, assignment, or subcontract agreement to the City, and the transferee, assignee, or
subcontractor assumes all of the obligations and liabilities of the Concessionaire under this
Agreement.
7206K1 28 37
18.06 Transfer to Wholly Owned Subsidiary
Concessionaire may transfer this Agreement to any wholly owned subsidiary provided
that Concessionaire shall guarantee and remain secondarily liable for the compliance with
all terms and conditions of the Agreement.
Article 19
Federal Regulations
19.01 Federal Government's Emergency Clause
All provisions of this Agreement shall be subordinate to the rights of the United
States of America to operate the Airport or any portion thereof during time of war or declared
national emergency in accordance with established lawful procedures. Such rights shall
supersede any provision of this Agreement that is inconsistent with the operation of the
Airport by the United States of America during time of war or national emergency.
Article 20
Nondiscriminatiom DBE Particivation.
20.01 Policy
It is the policy of City to promote the objectives of the United States Department of
Transportation with respect to the participation of DBE'S in DOT assisted contracts. This policy
has been formulated to comply with 49 CFR Parts 23 and 26. The Concessionaire agrees to
include the statements in Paragraphs 22.02, 22.03, and 22.04 in any subsequent agreement that it
enters and cause those businesses to similarly include the statements in further agreements.
20.02 Nondiscrimination
The Concessionaire for itself, its personal representatives, successors in interest, and
assigns, as a part of the consideration hereof, does hereby covenant and agree that:
(1) "This agreement is subject to the requirements of the U.S. Department of
Transportation's regulations, 49 CFR Part 23. The concessionaire or contractor agrees that it will
not discriminate against any business owner because of the owner's race, color, national origin,
or sex in connection with the award or performance of any concession agreement, management
contract, or subcontract, purchase or lease agreement, or other agreement covered by 49 CFR
Part 23.
(2) "The concessionaire or contractor agrees to include the above statements in any
subsequent concession agreement or contract covered by 49 CFR Part 23, that it enters and cause
those businesses to similarly include the statements in further agreements."
20.03 General Civil Rights Provision
The Concessionaire assures that it will comply with pertinent statutes, Executive Orders and
such rules as are promulgated to assure that no person shall,on the grounds of race, creed, color, national
origin, sex, age, or handicap be excluded from participating in any activity conducted with or
29 Revised: 6/16/10 38
7^_0669.1
benefiting from Federal assistance.
Article 21
Miscellaneous
21.01 Rights Reserved to the City
All rights not specifically granted to the Concessionaire by this Agreement are reserved
to the City.
21.02 City Not Liable
Except as specifically provided for in this Agreement the City shall not be under any
duty or obligation to the Concessionaire to repair or maintain the Assigned Areas, or any
portion thereof, or any facilities or equipment constructed thereon other than as previously set
forth herein. The City shall not be responsible or liable to the Concessionaire for any claims
for compensation or any losses, damages, or injury, including lost profits, sustained by the
Concessionaire resulting from failure of any water supply, heat, air conditioning, electrical
power, or sewer or drainage facility, or caused by the natural physical conditions on the
Airport, whether on the surface or underground, including stability, moving, shifting,
settlement of, ground, or displacement of materials by fire, water, windstorm, tornado, act of
God, or state of war, civilian commotion or riot, or any other cause or period beyond the control
of the City, except to the extent covered by the City's insurance.
21.03 Entire Agreement
This Agreement constitutes the entire agreement of the parties hereto and may not be
changed, modified or amended, but only by a written instrument of change,
modification or amendment executed by the party against whom enforcement of any
change, modification or amendment is sought.
21.04 Relationship of the Parties
The Concessionaire is and shall be deemed to be an independent contractor and operator
responsible to all parties for its respective acts and omissions, and the City shall in no way be
responsible therefore. Nothing in this Agreement shall be construed as making the
Concessionaire an agent or representative of the City for any purpose whatsoever. Further,
nothing in this Agreement is intended or shall be construed as in any way creating or
establishing the relationship of copartners between the Parties hereto.
21.05 Ingress and Egress
For the purpose of contract performance, the City will grant the
Concessionaire without charge therefore, the right of ingress and egress from said
Assigned Areas by the Concessionaire, its employees, contractors, suppliers, servicemen,
licensees, guests, patrons, and invitees, provided that such right of ingress and egress shall at
all times be exercised in compliance with any and all regulations promulgated by lawful
authority for the care, operation, maintenance, and protection of the Airport which apply to all
30 39
720 69.1
users of the Airport. For purposes of this Article, a person shall be deemed to conduct business on
the Airport if he occupies any space on the Airport or if he provides any services on the Airport, other
than utilities,on a regular or continuing basis.
21.06 Waiver of Performance
The failure of the City or the Concessionaire, in any one or more instances, to invoke a
provision, term, covenant, reservation, condition, or stipulation of this Agreement, or to enforce or
take action to enforce, or to demand performance by the other party hereto, or to insist upon a strict
performance by the other of any of the provisions, terms, covenants, reservations, conditions or
stipulations contained in this Agreement shall not be considered a waiver or relinquishment of the rights
to invoke enforce, demand, or insist thereon, but the same shall continue and remain in full force and
effect, and no waiver by either party of any provision,term, covenant, reservation, condition or stipulation
hereof shall be deemed to have been made in any instance unless expressed in writing. In the event any
provision contained in this Agreement is breached by either party and thereafter waived by the other
party, such waiver shall be limited to the particular breach so waived and shall not be deemed to be a
waiver of any other breach hereunder.
21.07 Specific Performance of Cit,,y's Rights
City shall, have the right to obtain specific performance of any and all covenants or
obligations of Concessionaire under this Agreement, and nothing contained in this Agreement shall be
construed as or shall have the effect of abridging such right.
21.08 Survival of Concessionaire's Obligations
All obligations of Concessionaire under this Agreement which cannot be ascertained to
have been fully performed prior to the end of the Term or any earlier termination hereof shall survive
the expiration or termination of this Agreement; whichever occurs earlier.
21.09 Severability
If any article, section, provision, term or condition of this Agreement is held to be invalid by a
court of competent jurisdiction, the remainder of this Agreement, including the remaining rights and
obligations of the City and the Concessionaire,shall not be affected thereby.
21.10 No Third Party Beneficiaries
This Agreement is for the benefit of the parties hereto only and is not intended to and shall not
create any rights in or confer any benefits upon any person or entity other that the parties hereto.
21.11 Governing Law
This Agreement shall be governed by and in accordance with the laws of the State of California
without regard to conflicts of law principals.
24.12 Venue
31 Revised: 6/16/10 4 U
7^_0669.t
To the extent allowed by law, the venue for any action arising from this Agreement shall
be Riverside County.
21.13 Waiver of Jury Trial
The Concessionaire hereby waives all right to trial by jury in any claim, action, proceeding or
counterclaim by either the Concessionaire or the City against each other or any matters arising out of or
in any way connected with this Agreement.
21.14 Notices
Any notice, demand, request, consent, approval, or communication either party desires or
is required to give to the other party or any other person shall be in writing and either served
personally or sent by certified mail, return receipt requested to the address set forth below.
Either party may change its address by notifying the other party of the change of address in
writing. Notice shall be deemed communicated forty-eight (48) hours from the time of mailing if
mailed as provided in this Section.
To City: Office of the City Manager
3200 E. Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, CA 92263-2743
Office of the Airport Director
Suite OFC
3400 E. Tahquitz Canyon Way
Palm Springs, CA 92263-2743
To Concessionaire: U.S. Enterprises d/b/a/ Corey Airport Services
Attn: President
225 Corey Center, SE Suite 1
Atlanta, Georgia 30312
21.16 Duplicate Counterpart Original
This Agreement may be executed in one or more counterparts, each of which shall be deemed
an original, and all of which together shall constitute one and the same instrument.
21.17 Capacity to Execute
The persons executing this Agreement on behalf of the parties hereto warrant that they
are duly authorized to execute this Agreement on behalf of said parties and that by so executing
this Agreement the parties hereto are formally bound to the provisions of this Agreement.
24.18 Execution
The parties hereto acknowledge that they have thoroughly read this Agreement, including any
exhibits or attachments hereto and have sought and received whatever competent advice and
32 41
720669.1
counsel was necessary for them to form a full and complete understanding of all rights and
obligations herein.
21.19 Transfer of Operations
Concessionaire agrees to cooperate with any substitute concessionaire at the termination of
this Agreement,whether by lapse of time or otherwise. Concessionaire shall provide a complete list of
existing advertising agreements including the contact person for each advertising client. City may
direct Concessionaire to leave in place any wall or other wraps and any artwork, graphics, posters, or
other collateral advertising material for reuse in the Airport subject to the consent of the advertising client.
[Signature Page Follows]
33 Revised: 6/16/10 42
l20669.1
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates stated
below.
"CITY"
City of Palm Springs
Date: By:
David H. Ready
City Manager
APPROVED AS TO FORM: ATTEST
By: By:
Douglas C. Holland, James Thompson,
City Attorney City Clerk
APPROVED BY CITY COUNCIL:
Date: Agreement No.
Corporations require two notarized signatures. One signature must be from Chairman of Board,President,or any Vice President. The
second signature must be from the Secretary,Assistant Secretary,Treasurer,Assistant Treasurer,or Chief Financial Officer,
COMPANY NAME:
Check one Individual Partnership_Corporation
Address
By By
Signature(Notarized) Signature(Notarized)
34 43
720669.1
CALIFORNM ALL44JRPOSE ACKNOWLEDGMENT CIVIL CODE§1180
A rotary public a other o fic r mrnpWang the mrtrwate wn€ea cr*1M idmaY of Nre i+3wdml who a Ad the
dacoxant tcwhich to cwffcem s asached,and m the tnMlulr ,acaray.ar vaidity of that doarrent
state of Calihorta )
County Of )
On before me.
Offie Here Insert Nana and MW of the Officer
personally appeared
NNT*W of )
who proved to me an the bean of anfiafa lory evidence to be the peraorm(s) whose tea) mhos
aubacribed to the vdthst nabumerd and acknowledged to ne that hefaheMey executed the acne in
limAmmRheiraultionzed c j(imia),andthatby trn/herAhava s)onthe nahunad the penaon(a),
or the entity upon hehaN of which the peraon(a)acted,executed the instrument.
I certify under PEWLTY OF PERJURY under the leas
of the State of California that the foregoing paragraph
is true and correct.
WrrW3S my hand and oFcid seed.
Signature
signature of Namry Putmc
Place Notary^Jest Above
Op7TOlYAt
Though Hera sac an=cp�crxnpm[irg Hat ffil Corr can dear aKerabm of the dopana,t a
laud ant realloohmerit of Hrs firm to an,unintended Oaaevwnt
Description of Attached Doaanrent
Tress or Type of Dochanad: Doauerad Oats
Number of Pagaa: Signer(a) Other Than Narred Above:
Cape-Wee)Claknhed by Grgner{a)
Signer'a None: Signer's hdrrra
❑Corporate Officer—Tea): ❑Corporate Officer—TO*):
❑PaMa— O tminded ❑Gerd ❑Partner— O Levied ❑(lenerel
❑Indni duet ❑Attorney in Fad ❑Idiodud ❑Atiorney in Fact
❑Trustee ❑Guar dim or Cbrum vator ❑Trustee ❑Guarder,err f anserAdor
❑War ❑Other:
&gner It Representing. Signrer la Reproseriling.
OM14 Nafo,A Nokerynmacu6m•a lla;oratildmyag-1-8W-LIS NDTARr(legg-s79-M7) hertm#5W
IN WITNESS WHEREOF,the parties have executed and entered into this Lease as of the date first written above.
CITY OF PALM SPRINGS
639913.1 1 44
,t
Advertising Concession
e
r Exhibit A
CONEY
4.
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a-
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Existing Program Locations 67 '^
New Program Locations 59
�� • City Program 7 INTERNATIONAL AIRPORT
• City Shared it spot on Digital) 7*
';\ ,`: •Included in New Program location count
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