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HomeMy WebLinkAbout2013/12/10 Item 18 - -�:�-_ � CITY COUNCIL � -��.-� AGENDA STATEMENT .E_� �� _ �� `�,,,,w'•—• cirv oF CHUTA ViSfA DECE��IBER 10. 20li. Item �� ITED4 TITLE: �SOLUTION OF THE CITY COiINCIL OF THE CITY OF CHULA VISTA APPROVII�TG A LICEI�TSE AND OVERSIGHT AGREEI�4ENT �WITH A1'AWEL liSA LLC. DBA COOL DOW1 COFFEE. TO OPERATE A V�'IFI COFFEE CAFE AT THE E STREET TRANSIT CE\TTER SUBA4ITTED BY: ECONOMIC DEVELOPMENT DIRECTOR�� PRII�'CIPAL ECONOn4 C DEVELOPn4ENT SPECIALIST� REVIE�i'ED BY: CITY A�\TAGE 4hTHS VOTE: YES � NO � SIJi�'1n�LARY The Cit1 has co-o��med the Chula Vista E Street 'I-ransit Center Buildine (Center) ��ith the governing reeional Transit Authoriri�, since its construction in 1986, durina ���hich time bv agreement the Ciri� has operated the facilit�. Since Januazy of 2013 the City has partnered �;�ith not-for-profit partners to re-establish the Center as a comfort station for the more than 6;000 bus and trolle�� passeneers that use the site for transit services on an averaee da��. For the past }�ear; the City has been seekine an operator for the Center to provide the eoods and sen ices that transit ridership desires. Staff is seekine approval of a License and Oversi2ht Aereement �i�ith Cool Do��m Coffee to operate a Wi-Fi coffee cafe at the Transit Center (Attachment 1). ENVIRONAIENTAI, REVIE�V The Deti�elopment Sen�ices Director has reviewed the proposed project for compliance ���ith the Califomia Environmental Qualiri� Act (CEQA) and has determined that the project falls under the Class 1 Cateeorical Esemption in accordance with Section 1�301(a) of the State CEQA Guidelines because it in�roh es onl}• interior improvements and minor esterior improvements including installation of sienage and a dumpster at an existins location. Thus, no further em�ironmental re�ie�v is necessary. RECOMMEND aTION Council adopt the resolution. 18-1 DECEMBER 10. 2013 Page 2 of 4 BOARDS/COMMISSION RECOMMENDATION N/A DISCUSSION In 1986; the Citq of Chula Vista, the County of San Diego, and the San Diego Metropolitan Transit Development Board entered into an agreement for the management and operation of the E Street Trolley Station. Since its construction, the City has manaeed the Transit Center Building ("Center"); and the City and the Metropolitan Transit System (MTS) (the successor agency to the County and MTDB) share maintenance responsibilities for the property. A4TS also provides funding to the City for maintenance costs. Over the years, there have been a variety of operators in the Center. From 1994 through 2012, the City had a contract w�ith the Chula Vista Chamber of Commerce for the operation of the Visitor Information Center at the Center. For the past 11 months; the Center has been in transition from the tourism-dedicated operation it had been; to a transit- focused Center. In December of last }�ear, Public Works crews and contractors cleaned, painted; and repaired any broken or poorly functioning portions of the infrastructure. In January of this year, the City contracted �vith the Urban Corps to provide additional ongoing maintenance including: po�i�er ���ashing sidewalks and walkways to remove stains and gum, remove debris and excess plant material from medians, and trim bushes. The Corps also helped the City set up tables and chairs in the facility and opened the bathrooms to the public, transitioning the focus of the Center from visitors to a Transit Comfort and Information Center. The contract with the Urban Corps ended in July, and in October the Cit}� entered into a new agreement with Employment R Community Options for similar services. The appeazance of the entire Transit Center has greatly improved, and both the Urban Corps and Employment & Community Options have provided a first-class transit eaperience by providing a safe, clean and inviting facility, and reaching out to welcome transit users and visitors �vith basic information during peak transit periods. As the initial goal of providing basic comfort to the transit user �vas being established, the City also pursued an agreement ���ith a co�nmercially-recognized vendor to establish a Wi- Fi cafe at the location that would complement the commuter experience; serve as an attraction to commuters, visitors and residents; and provide a setting to promote transportation options, tourism, MTS and the City of Chula Vista. Staffls goal was to put in place a viable commercial operation that revitalizes the Transit Center, provides a first- class e�perience for transit users and sets the stage for future development. The Metropolitan Transit System has endorsed this approach and the City took the lead in contacting potential vendors. Staff has conducted targeted outreach to 10 potential local and national vendors and held several onsite �valk-throughs with potential operators. City staff ultimately selected Cool Do«�n Coffee to operate at the Center. Cool Down Coffee successfully operated a coffee 18-2 DECE�4BER 10. 2013 Paee 3 oF4 cafe in the Villaae �l%alk Shopping Center for t���o years. The business became well kno�m to loca] residents; and �;�as hea�ii}= im�olved in the bic��cle and ruruiing communitv. Cool Do�m Coffee «�ill sienificantl}� improve the ridership e�perience b�� pro��idins be��erages and pre-packaeed�food at the site. Cool Do«n «�ill significanth improve the appearance of the building's interior, pro��ide \�%i-Fi access; and continue to support the public use of the resirooms and rest areas. Cool Do«�n Coffee will also provide new sienage on the exterior of the building and construct a trash/rec}�cline enclosure (Attachment 2). Cool Down has also agreed to display Cirv informational brochures as well as information on Cirv special events and attractions. Ciri� staff �vill also provide information reeardine the Ciri to Cool Do���n staff so that the facility can continue to pro��ide information to visitors and residents alike. Cool Do�in Coffee Nill pa} the City $2,400 per month for the three-}eaz term of the Aereement. If the City, at its sole discretion; extends the term of the Agreement, the monthly rent ��ill increase b} a percentaee equal to the most recent t�velve month reported period for the All Urban Consumers; San Die�o Consumer Price Index. The Cin «�ill be providing Cool Do��n Coffee ��-ith a credit against the monthly rent for financial in��estment in permanent or fixed improvements and/or alterations to the Center that aze included in the pre-occupancy plan. The maximum rent credit ���ill be �1,900 per month and will not exceed 36 months. �'�Jhile Cool Do«r Coffee �iill operate at the Center, staff intends to continue to contract ���ith Employment R Community Options (or a similaz entity) to provide basic maintenance service for the area outside the Center and provide periodic supplemental cleaning of the public restrooms to offset public transit use. DECISION MAKER CONFLICT Staff has re��ie�i�ed the propem� holdings of the City Council and has found no property holdings within �00 feet of the boundaries of the propem� �ahich is the subject of this action. Staff is not independentl}� a���are; and has not been informed bv am� City Council member, of am� other fact that mav constitute a basis for a decision-maker conflict of interest in this matter. LINK TO STRATEGIC GOALS The Cit��`s Svateeic Plan has five major eoals: Operational E�cellence, Economic Vitality, Healthy Community, Strong and Secure Neiehborhoods and a Connected Communitq. The License and O��ersieht Agreement supports the Economic Vitality and Operational E�cellence eoals by eenerating revenue from a City asset and more efficiently operating this Cit}� facilitt through a public private partnership. CURRENT 1'EAR FISCAL IDZPACT The City recei��es money from MTS for maintenance of the Transit Center. These funds cover the costs of Cit}� staff; Employment & Communitv Options, as ���ell as other contractors at the site. 18-3 DECEn�BER 10. 2013 Page 4 of 4 The License and Operating Agreement requires Cool Down Coffee to pay �2;400 per month in rent. The AQreement also provides for a rent credit for permanent improvements to the Center not to eaceed $1;900 per month and not to exceed 36 months. At a minimum the operator will pay a minimum of $500 per month, however, should the eligible capital improvements be less than $68;000, the rent credit will be reduced and the monthly papment to the City shall increase. The minimum $500 monthly payment is projected to cover or e�ceed any increased utility costs incurred by the operation of the business: thus resulting in a neutral or positive fiscal impact to the Genera] Fund. The lease revenues will be posted to the General Fund and ��ill be used for utility and maintenance costs at the facility. ONGOING FISCAL IMPACT As stated in the Current Year Fiscal Impact, the minimum monthly payment is projected to cover or exceed any increased utility costs incurred by the operation of the business, thus resulting in a neutral or positive fiscal impact to the General Fund. Net revenues �vould be managed by Finance and Public Works/Transit staff to appropriately address the obligations identified in the Agreement between tl�e City and MTS. ATTACHMENTS 1. License and Oversight Agreement with Ayawel USA LLC, Dba Cool Down Coffee 2. Drafr Conceptual Dra�i�ings— Cool Do�vn Coffee Prepared by� Craig Rurz, Princrpa!Erononeic Deoelopnven�Speciulist, Economic DerelopmendAdministratron 18-4 COLTTCIL RESOLUTION NO. RESOLUTION OF THE CITY COL�'CtL OF THE CITY OF CHULA VISTA APPROVII�'G A LICEI�TSE AND OVERSIGHT AGREEi�1EI�'T V�'ITH .Al'A\VEL USA, LLC. DBA COOL DO\V\' COFFEE, TO OPERATE A VdI-FI COFFEE CAFE AT THE E STREET TRAI`'SIT CENTER WHEREAS, In 1986, the Ciri� of Chula Vista, the Countv of San Dieeo. and the San Dieeo �4etropolitan Transit Development Board (\4TDB) entered into an a2reement for the manaeement and operation of the E Street Trolle}� Station; and ��'HEREAS; since construction, the Transit Center Buildine ("Center'); the City and the A4etropolitan Transit S�stem (ATTS), the successor asencv to the_ b4TDB, have shared maintenance responsibilities for the propem�, and the City has mana�ed the Center; and NHEREAS, from 1994 throush 20012, the Citv contracted «ith the Chula Vista Chamber of Commerce for the operation of the Visitor Information Center at the Center; and R'HEREAS, since January 1, 2013, the Center has been vacant; and NHEREAS, for the past }�eaz, the City has pursued an agreement �i�ith a commercially recognized vendor to establish a �'�'i-Fi cafe at the Center that ��ould complement the commuter experience; serve as an attraction to commuters; visitors and residents, and pro��ide a settine to promote transportation options; tourism. A4TS and the City of Chula Vista; and �'✓HEREAS; the City sought proposals from 10 commercially recognized vendors to establish a Wi-Fi cafe at the Center: and �'�'HEREAS; staff is seekine approval of a License and Oversight Agreement ���ith Cool Do��n Coffee to operate a �Vi-Fi coffee cafe at the Transit Center. NOW, THEREFORE; BE IT RESOLVED by the Citv Council of the City of Chula Vista. that it approves the "License and O��ersi2ht Aereement between the Cih� and A��a��el USA, LLC; dba Cool Do�vn Coffee,' .to operate a \�'i-Fi coffee cafe at the E Street Transit Center; in the form presented; with such minor modifications as ma}� be required or approved by the City Attomey, a cop}� of which shall be kept on file in the Office of the Cit�� Clerk; and authorizes and directs the Mayor to execute same. Presented by Appro��ed as to form by � . �1 r James D. Sandoval Cie'n R. 000�ns . Cit}��4anaeer Cin{Attome}� i J:Wttomev�F[NAL RESOS AND ORDINANCES�?013\I2 10 13Utem 7-RESO-ECON DEV-Cool Do��n 12-t0.doc 12/3/?013 10:47 M�1 " � 8-5 THE ATTACHED AGREEMENT HAS BEEN REVIEWED AND APPROVED AS TO FORM BY THE CITY ATTORNEY'S OFFICE AND WILL BE FORMALLY SIGNED UPON APPROVAL BY THE CITY COUNCIL � �� �/ ��`T� , � , Glen R. Googin ��,����`�� City Attorney Dated: ���C� � � �� LICENSE AND FACILITY OVERSIGHT AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND AYAWEL USA, LLC 18-6 LICENSE AND FACILITY OVERSIGHT AGREEMENT THIS LICENSE AND FACILITY OVERSIGHT AGREEMENT (the "Agreement") is entered into by and between the CITY OF CHULA VISTA, a chartered municipal corporation ("City"), and AYAWEL USA, LLC, a Limited Liability Company ("Licensee"), (collectively, the "Parties") with reference to the foliowing facts: RECITALS A. City and the Metropolitan Transit System ("MTS") co-own the Transit Visitor Center building at 750 E Street, Chula Vista more fully described herein below (the "Center"); and B. City and the Metropolitan Transit Development Board (predecessor-in-interest to the MTS) MTDB are paRies to the "Agreement Between the County of San Diego, the City of Chula Vista and the San Diego Metropolitan Transit Development Board for the Management, Operation and Maintenance of the Bayfront Troliey Station," effective October 17, 1986 (the "Operation Agreement"), by which the City has agreed to: (i) administer all visitor information leases, and (ii) provide, operate, and maintain the Center, and all landscaping, irrigation, signage, and utilities; and C. Licensee is the owner and operator of Cool Down Coffee whose principle place of business is located at 466 Third Avenue, Suite B, Chula Vista California, 91910; and D. Licensee desires to and has requested permission to operate a concession at the Center, for the purpose of selling food and drinks; and D. City would derive revenue from this Agreement in the form of a monthly use fee of 52,400 per month less a capital improvement credit described in Section 3.1 b herein; and E. In order to obtain this revenue, maintain bathroom access for the public during posted business hours, and provide food and beverage services that complement the transit user experience, City is willing to license the Center to Licensee, under the terms, covenants, conditions and provisions contained herein. NOW THEREFORE, THE PARTIES HERETO MUTUALLY AGREE AS FOLLOWS: SECTION 1: GRANT OF LICENSE AND LICENSE DUTIES 1.1 Premises. Subject to the terms, covenants, conditions and provisions hereof, City hereby grants Licensee a license to access and use a portion of the Center, which portion is depicted in Exhibit "A" attached hereto and incorporated by this reference, ("Premises") for those uses specifically identified in section 1.2 below 1.2 Uses. It is expressly agreed that the Premises shall be used by Licensee solely and exclusively for the purpose of selling food and drinks, excluding alcohol and tobacco products, at the Center; and for such other related or incidental purposes as may be first approved in writing by the City's Real Property Manager ("Manager"), and for no other purpose Page 1 12/4/2013 Cool Down Coffee License 8 FacilBy Agreement � 8—� whatsoever. Licensee is authorized by the City to market the Center but Licensee shall not have, and this Agreement does not convey to Licensee exclusive marketing or use rights for the Center Licensee shall include City and MTS logos in its marketing materials for the Center, at the discretion of the City and MTS, respectively. Licensee covenants and agrees to use the Premises only for the above specified purpose and to diligently pursue said purpose throughout the term hereof. Licensee shall not use or permit any use of the Premises in any manner which disturbs the use and quiet enjoyment by City or MTS, any other City authorized parties making use of the Center, or any adjacent property owners or tenants. In the event that Licensee fails to use the Premises during the hours of operation identified in section 5.4 on a regular basis, or uses the Premises for purposes not expressly authorized herein, the Licensee shall be deemed in default under this Agreement. 1.3 Reservation of Riqhts. City shall not unreasonably or substantially interfere with Licensee's use of the Premises while Licensee is using the Premises as provided herein. However, in addition to any and all other rights, title and interest in the Premises, the City specifically retains the following rights: � a. Right to Enter. City has the right to enter the Premises for the purpose of performing maintenance, inspections, repairs or improvements, or developing municipal resources and services, including but not limited to maintenance of a video screen for purposes of displaying City and MTS information. b. Right of Use. City has the right, at all times, to use for itself, and to make available for public and private use, the restrooms and outdoor areas of the Center. 1.4 Licensee Responsibilities for Concession Oversiqht. In consideration of City's grant to Licensee of the license rights described herein, Licensee agrees to provide facility oversight services to the Center as more particularly described in Section 3 below. SECTION 2: TERM 2. 1 Term. a. Initial Term. This Agreement shall take effect upon full execution of the Agreement, and shall be effective as of the latter of: December 11, 2013, or the date on which the City confirms that Licensee has designated an agent for service of process with the California Secretary of State (the "Effective Date"). The Agreement shall be for a term of 36 months from the Effective date, unless extended pursuant to the terms of this Agreement. b. Options to Extend. The City, at its sole discretion, may grant the Licensee up to five, one-year extensions of this Agreement. If City desires to grant such extensions, it shall do so by notifying Licensee, in writing, signed by the City Manager or designee, that the extension has been granted. Unless othenvise mutually agreed by the Parties in writing, the terms and conditions of this Agreement shall remain in effect during the extended term. If City for any reason cannot deliver possession of the Premises to Licensee at the commencement of the term, or if during the term of this Agreement Licensee is dispossessed for any reason whatsoever, City shall not be liable to Licensee for any loss or damage, including compensatory Page 2 �ziaizois Cool Down Coffee License 8 Facility Agreement � 8-8 or punitive, resulting there from, and Licensee hereby waives and releases the City from and against any claims for loss or damage. 2. 2 Termination. Notwithstanding any other remedies provided by this Agreement, City has the right, at its sole discretion, without cause, to terminate this Agreement and the license granted herein, upon thirty (30) days written notice to Licensee. Licensee shall also have the right to terminate this Agreement upon thirty (30) days written notice to City. If the City chooses to terminate and the Licensee is in full compliance with all conditions of the Agreement, the City shall make a good faith effoR to provide six months' notice of the termination. If termination is for City convenience and prior to the end of the initial 36-month term, the City may, at its sole discretion, reimburse Licensee for the remaining value of the fixed improvements documented by Licensee in the PLAN, and approved by the City as provided below in Section 3.1.b. Such reimbursement shall not include the previously-established value of any fixed improvements that the City allows Licensee to remove from the premises. a. Termination for Cause. Notwithstanding the foregoing, in the event that Licensee has breached any material provision of this Agreement, in addition to any other remedies provided by law or equity, the City may terminate this Agreement upon ten (10) days written notice. The City at its discretion may provide Licensee an opportunity to cure the breach to avoid termination. 2. 3 Surrender of Premises. At the expiration or earlier termination of this Agreement, Licensee shall surrender the Premises to City free and clear of all liens and encumbrances, except those liens and encumbrances which existed on the date of the execution of this Agreement by City. The Premises, when surrendered by Licensee, shall be in a safe and sanitary condition and shall be in as good or better condition as the condition at the commencement of this Agreement, absent normal wear and tear. SECTION 3: CONSIDERATION FOR LICENSE —FACILITY OVERSIGHT 3.1 Consideration. In consideration of the uses of the Premises licensed to Licensee hereunder, Licensee agrees to pay the City $2,400 per month on the first of each month, or if the first falls on a weekend or holiday the next business day for the term of this Agreement, as set forth in Section 2.1 of this Agreement. For convenience only, consideration as set forth in this Section 3 may be referred to as rent. 3.1.a Rent Escalation. The monthly rent shall be a fixed rate for the initial term. If the City extends the term of the Agreement, the monthly rent for the following twelve month period shail increase by a percentage equal to the most recent tweive month reported period for the All Urban Consumers, San Diego Consumer Price Index. If that index is no longer published, the City shall select an alternative used by local governments for the region. 3.1.b Rent Credit. The City will provide the Licensee with a credit against the monthly rent for financial investment in permanent or fixed improvements and/or alterations to the Center that are included in a written pre-occupancy plan (PLAN), approved by the City and documented by receipt pursuant to Section 6 herein (Exhibit B, attached and incorporated by this reference). Licensee acknowledges that City's approval may be contingent on MTS approval, pursuant to the Operating Agreement. The total monthly rent credit shall be no greater than $1,900 per month and shall not exceed 36 months. 3.2 Facilitv Oversiqht. Licensee shall be responsible for controlling access to and from the Center and insuring that Licensee employees act in a professional manner that does Page 3 �vaizois Cool Down Coffee License&Facility Agreement � 8-9 not damage the image of or reflect badly on the City or MTS. Licensee shall also be responsible for maintenance and upkeep of the Center, keeping it in an attractive, good, neat, and orderly condition during the term of this Agreement as more particularly provided in Section 6.3 hereof, below. SECTION 4: INSURANCE RISKS/SECURITY 4.1 Indemnitv. a. To the maximum extent allowed by law Licensee hereby agrees to defend, indemnify, and hold the City, its directors, officers, employees, and agents, harmless from and against any and all liability or claim of liability, loss or expense, including defense costs and legal fees and claims for damages of whatever character, nature and kind, whether directly or indirectly arising from or connected with, or related to this Agreement or an act or omission of Licensee, or any employee, agent, invitee, contractor of Licensee, or other person acting by or on behalf of Licensee on or about, the Premises, the Center or this Agreement, including, but not limited to, liability, expense, and claims for bodily injury, death, personal injury, or property damage, and any related attorneys' fees or court costs. This indemnity provision does not include any claims, damages, liability, costs and expenses (including without limitations, attorneys' fees) arising from the sole negligence or sole willful misconduct of the City, its officers, employees, or agents. Also covered is liability arising from, connected with, caused by or claimed to be caused by the active or passive negligent acts or omissions of the City, its agents, officers, or employees which may be in combination with the active or passive negligent acts or omissions of the Licensee, its employees, agents or officers. b. To the maximum extent allowed by law Licensee hereby agrees to defend, indemnify, and hold MTS, its directors, officers, employees, and agents, harmless from and against any and all liability or claim of liability, loss or expense, including defense costs and legal fees and claims for damages of whatever character, nature and kind, whether directly or indirectly arising from or connected with, or related to this Agreement or an act or omission of Licensee, or any employee, agent, invitee, contractor of Licensee, or other person acting by or on behalf of Licensee on or about the Premises, the Center, or this Agreement, including, but not limited to, liability, expense, and claims for bodily injury, death, personal injury, or property damage, and any related attorneys' fees or court costs. This indemnity provision does not include any claims, damages, liability, costs and expenses (including without limitations, attorneys' fees) arising from the sole negligence or sole willful misconduct of MTS, its officers, employees, or agents. Also covered is liability arising from, connected with, caused by or claimed to be caused by the active or passive negligent acts or omissions of MTS its agents, officers, or employees which may be in combination with the active or passive negligent acts or omissions of the Licensee, its employees, agents or officers. c. Costs of Defense and Award. Included in the obligations in Sections a. and b., above, is the Licensee's obligation to defend, at Licensee's own cost, expense and risk, any and all aforesaid suits, actions or other legal proceedings of every Page 4 �2iaizois Cool Down Coffee License 8 Facility Agreement � 8—� � kind that may be brought or instituted against the City or MTS, or their directors, officials, officers, employees, agents and/or volunteers. Licensee shali pay and satisfy any judgment, award or decree that may be rendered against City or MTS or their directors, o�cials, officers, employees, agents and/or volunteers, for any and all legal expense and cost incurred by each of them in connection therewith. d. Insurance Proceeds. Licensee's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by the City or MTS, or their directors, officials, offcers, employees, agents, and/or volunteers. e. Declarations. Licensee's obligations under Section 4 shall not be limited by any prior or subsequent declaration by the Licensee. f. Enforcement Costs. Licensee agrees to pay any and all costs City or MTS incurs enforcing the indemnity and defense provisions set forth in Section 4. g. Survival. Licensee's obligations under Section 4 shall survive the termination of this Agreement. 4.2 Insurance. Licensee shall take out and maintain at all times during the term of this Agreement the following insurance at its sole expense: a. Licensee shall maintain the foilowing minimum limits: General Liabilitv Insurance Commercial General Liability Insurance covering liability of the Licensee with respect to all operations to be performed and all obligations assumed by the Licensee under the terms of this Agreement. Coverage for commercial general liability shail be at least as broad as Insurance Services Office Commercial General Liability Coverage (Occurrence Form CG 0001). Limits shall be no less than one million dollars ($1,000,000) per occurrence for bcdily injury, personal injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply to the Concession (with the ISO CG 2503, or ISO CG 2504, or insurer's equivalent endorsement provided to City) or the general aggregate limit shall be twice the required occurrence limit. If Licensee maintains higher limits than the minimums shown above, the City and MTS require and shall be entitled to coverage for the higher limits maintained by Licensee. Automobile Liabilitv Insurance Not Applicable Workers' Compensation and Emplover's Liabilitv Insurance Workers' Compensation and Employer's Liability Insurance complying with the requirements of all applicable laws relating to workers' compensation insurance, covering or insuring all of the Licensee's employees working on or about the Concession. Limits shall be no less than statutory limits per accident for bodily � Page 5 �zrarzo�s Cool Down CoYee License 8 Facility Agreement 18-11 injury and disease. By his/her signature hereunder, Licensee certifies that it is aware of the provisions of Section 3700 of the California Labor Code which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that code, and it will comply with such provisions in connection with any work performed on or about the Premises or the Center. Any persons providing services with or on behaif of Licensee shall be covered by workers' compensation (or qualified self- insurance) b. All insurance companies affording coverage to the Licensee shall be required to add the City of Chula Vista, and MTS, and their respective officials, officers, employees, and agents as "additional insured(s)" under the insurance policy(ies) required in accordance with this Agreement. Licensee shall furnish (or cause to be furnished) a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form of the insurance carrier setting forth the general provisions of the insurance coverage. This countersigned certificate (and separate endorsement page) shall name the City and NITS and, their respective officers, agents, employees, and authorized volunteers as additional insureds under the policy. Coverage provided hereunder to the City and MTS, and City and MTS as additional insureds, by Licensee shall be primary insurance may not exclude "products completed operations hazard" and other insurance maintained by the City or MTS, its officials, officers, agents and/or employees, shall be excess only and not contributing with insurance provided pursuant to this Section 4.02, and shall contain such provision in the policy(ies), certificate(s) and/or endorsement(s). Each insurance policy and certificate of insurance required by this Agreement, shall contain a waiver of subrogation for the benefit of the City and MTS, and their respective officials, officers, employees, and agents. c. All insurance companies affording coverage to the Licensee shall be insurance I organizations acceptable to the City, and authorized by the Insurance Commissioner of the State Department of Insurance to transact business of insurance in the State of California. Insurance is to be placed with insurers having a current A.M. Best rating of no less than A-, VII or equivalent or as otherwise approved by City. d. All insurance companies affording coverage shall provide thirty (30) days written notice to the City and MTS should the policy be cancelled before the expiration date. For the purposes of this notice requirement, any material change in the policy prior to the expiration shall be considered a cancellation. � e. Licensee shall provide evidence of compliance with the insurance requirements listed above by providing a certificate of insurance, in a form satisfactory to the City Attorney, concurrently with the submittal of this Agreement. f. Licensee shall provide a substitute certificate of insurance no later than thirty (30) days prior to the policy expiration date. Failure by the Licensee to provide such a substitution and extend the policy expiration date shall be considered a default by Licensee and may subject the Licensee to a termination of this Agreement. Page 6 12/4/2013 Cool Down Coffee License&Facility Agreement � 8—� 2 g. Maintenance of insurance by the Licensee as specified in this Agreement shall in no way be interpreted as relieving the Licensee of any responsibility whatever and the Licensee may carry, at its own expense, such additional insurance as it deems necessary. h. If Licensee fails or refuses to take out and maintain the required insurance, or fails to provide the proof of coverage, City has the right to obtain the insurance. Licensee shall reimburse City for the premiums paid with interest at the maximum allowable legal rate then in effect in California. City shall give notice of the payment of premiums within thirty (30) days of payment stating the amount paid, names of the insurer(s), and rate of interest. Said reimbursement and interest shall be paid by Licensee on the first (1st) day of the month following the notice of payment by City. i. City, at its discretion, may require the revision of amounts and coverage at anytime during the term of this Agreement by giving Licensee sixty (60) days prior written notice. City's requirements shall be designed to assure protection from and against the kind and extent of risk existing on the Premises and the Center. Licensee also agrees to obtain any additional insurance required by City for new improvements, in order to meet the requirements of this Agreement. j. Notwithstanding the preceding provisions of this Section 4.02, any failure or refusal by Licensee to take out or maintain insurance as required in this Agreement, or failure to provide the proof of insurance, shall be deemed a default under this Agreement and in such event, City may terminate this Agreement upon three (3) days written notice to Licensee. For the purposes of this Agreement, the condition to provide the insurance coverage required under this Section 4.02 shall be in addition to rent. 4.3 Accident Reports. Licensee shall provide a written report to City within 24 hours of any accident causing any property damage or any serious injury to persons on or about the Premises or the Center. This report shall contain (he names and addresses of the paRies involved a statement of the circumstances, the date and hour, the names and addresses of any witnesses and other pertinent information. SECTION 5: TERMS AND CONDITIONS OF OCCUPANCY 5.1 Form of Aqreement. This Agreement is a limited License for the use of the Premises for those particular purposes identified in Section 1.2. Nothing in this Agreement shall be interpreted to grant any interest in the Center or the Premises other than that specified in this Agreement. At no time shall the Licensee's limited interest in the Premises ripen into a leasehold or fee interest with a claim or right to exclusive possession thereof. 5.2 Riqht to Occupv. Licensee right to occupy the Premises may be terminated by City at any time if Licensee fails to satisfactorily perform the improvement, maintenance, and upkeep duties or responsibilities of Licensee set forth hereunder. City reserves the right to terminate this Agreement as may be provided for elsewhere herein. Page 7 �vanois Cool Down Coffee License&Facility Agreem=nt 18-13 5.3 Taxes. Licensee shall pay, before delinquency, all taxes, assessments, and fees assessed or levied upon Licensee or the Premises, including the land, any buildings, structures, machines, equipment, appliances, or other improvements or property of any nature whatsoever erected, installed, or maintained by Licensee or levied by reason of the business or other Licensee activities related to the Center or the Premises, including any licenses or permits. Licensee recognizes and agrees that this Agreement may create a possessory interest subject to property taxation, and that Licensee may be subject to the payment of taxes levied on such interest, and that Licensee shall pay all such possessory interest taxes prior to their delinquency. 5.4 Hours of Operation. Licensee will conduct business and be present at the Premises any time during the Center's normal hours of operation and other hours as arranged in advance with the Real Property Manager (Exhibit C, attached and incorporated by this reference). Licensee shall provide access control to the Premises and the Center in a manner approved by City to prevent unauthorized access to the facility during Licensee's hours of operetion. 5.5 Utilities. Licensee agrees that utilities are available under this License and the cost thereof shall be borne by the City. Use of said utilities shall be only as needed to carry on the operations permitted under this License. 5.6 Business License and Permits. Licensee shall maintain a valid City of Chula Vista Business License at all times during operations covered by this License. Licensee is responsible to obtain and maintain any and all permits and licenses required for the operation of its business at the Center. SECTION 6: IMPROVEMENTS/ALTERATIONS/REPAIRS 6.1 Acceptance of Premises. The Premises is being offered to Licensee in an As- Is and Where-Is condition without any warranty, expressed or implied. Licensee represents and warrants that it has independently inspected the Premises and made all tests, investigations, and observations necessary to satisfy itself of the condition of the Premises and all improvement appurtenant thereto. Licensee acknowledges it is relying solely on such independent inspection, tests, investigations, and observations in making this Agreement. Licensee further acknowledges that the Premises are in the condition called for by this Agreement, and that Licensee does not hold City responsible for any defects, whether latent or patent, in the Premises. 6.2 Waste. Damaqe, or Destruction. Licensee shall give notice to City of any fire or other damage that occurs on the Premises within twenty four (24) hours of such fire or damage. Licensee shall not commit or suffer to be committed any waste or injury or any public or private nuisance, to keep the Premises, adjoining sidewalks, and other public areas, clean and clear of refuse and obstructions, and to dispose of all garbage, trash, and rubbish in a manner satisfactory to City. If the Premises shall be damaged by any cause which puts the Premises into a condition which is not decent, safe, healthy and sanitary, Licensee agrees to make or cause to be made full repair of said damage and to restore the Premises to the condition which existed prior to said damage; or, at City's option, and upon receipt of written demand thereof, Licensee agrees to clear and remove from the Premises all debris resulting from said damage and repair the Premises in accordance with plans and specifications Page 8 i2iarzois Cool Down Coffee License&Facility Agreement 18-14 previously submitted to City and approved in writing in order to replace in kind and scope the improvements which existed prior to such damage. Licensee shall be responsible for all costs incurred in the repair and restoration, or rebuilding of the Premises. Licensee shall not cause or permit any hazardous material to be used, stored, transported, generated, or disposed in or about the Center by Licensee, Licensee's agents, employees, contractors, Licensees, or invitees. "Hazardous Material" means any hazardous, toxic, or infectious substance, material, or waste, which is or becomes regulated by any local governmental entity, the State of California, or the United States government under any law, regulation or ordinance. 6.3 Maintenance. Licensee agrees to provide periodic maintenance of the Center throughout the term of this Agreement. Licensee shall also be responsible for maintenance of the Center as necessary to meet industry standards for handling and selling food and beverages including but not limited to: periodic cleaning and sweeping/mopping of restrooms and outdoor areas from curb to curb and 50 feet to the west, or as necessary. Licensee will make customary and usual maintenance necessary to maintain and preserve the Center. Licensee shall remove and lawfully and properly dispose of all garbage, litter, trash, debris, and - rubbish from or about the Center, adjoining sidewalks, and other public areas, on a daily basis. All maintenance and other Licensee duties set forth herein shall, during the term hereof, be done at Licensee sole cost and expense and City shall not be called upon for any outlay or expense related thereto except as described in Section 3.1b herein. Major maintenance and/or repair issues must be referred to City for evaluation prior to any work being performed or cost therefore incurred. City at its sole discretion shall determine what work shall be performed. Major maintenance and/ or repair issues that are not a direct result of Licensee's actions shall be the responsibility of the City. If at any time during the term of this Agreement, City reasonably determines that the Center is not in a decent, safe, healthy, and sanitary condition, City may, at its sole discretion and option, terminate this Agreement upon written notice to Licensee. and regain possession of the Premises from Licensee. If the condition is proximately caused by Licensee's use of the Premises, City may upon written notice to Licensee, have any necessary maintenance work done in order to place the Center back to a decent, safe, healthy, and sanitary condition at the expense of Licensee. In such event, City shall provide Licensee written notice and itemized billing showing the work performed and Licensee shail make payment to City no later than thirty (30) days after receipt of said notice and billing. The rights reserved in this Section 6. 3 shall not create any obligations on City or increase obligations eisewhere in this Agreement imposed on City. The provisions of this Section 6.3 shall survive the expiration or earlier termination of this Agreement. 6.4 Improvements/Alterations. No improvements, structures, or installations shall be constructed on the Premises, and the Premises may not be altered by Licensee without prior written approval by the City as described in Section 3.1.b herein. The Licensee shall provide a written Plan for the City's review and approval prior to occupying the facility describing the proposed improvements and/or alterations including, but not limited to,; engineering and architectural documents generated by a licensed third party, lighting, flooring, window, door, painting upgrades. The City's approval of the Plan and each final improvement shall be at its sole discretion, and may be subject to MTS approval, pursuant to the Operating Agreement. Page 9 ivanois Cool Down Coffee License 8 Facility Agreement 18-15 Licensee shall deliver a certified copy of any architectural or engineering documents to City no later than 30 days after their certification by a licensed professional. This provision shall not relieve Licensee of any obligation under this Agreement to maintain the Center in a decent, safe, healthy, and sanitary condition, including structural repair and restoration of damaged or worn improvements. City shall not be called upon to, or be obligated by this Agreement to make or assume any expense for any existing improvements or alterations. 6.5 Liens. Licensee shall not, directly or indirectly, create, incur, assume or suffer to exist any mortgage, pledge, lien, charge, encumbrance, or claim on or with respect to all or any portion of the Center without the prior written consent of the City's Property Manager. Licensee shall promptly, at its own expense, take such action as may be necessary to duly discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim on or with respect to all or any portion of the Center for which Licensee does not have the prior written consent of the City's Property Manager. 6.6 Sians. Licensee will be allowed up to 4 signs advertising Licensee's business, two on the Center and one on each of the two monuments at the entrance to 750 E Street. Each sign shall comply with the City sign ordinance, shall not exceed 18 inches square and shall be subject to pre-approval by the City as to its design and location. Licensee shall not erect or display any other banners, pennants, flags, posters, signs, decorations, marquees, awnings, or similar devices or advertising on or about the Center without the prior written consent of City. If any such unauthorized item is found on the Center, Licensee shall remove the item at its expense within twenty-four (24) hours of written notice thereof by City, or City may thereupon remove the item at Licensee's cost. 6.7 Ownership of Improvements. Any and all improvements, structures, and installations or additions to the Center now existing or constructed on the Center by Licensee including those in the Plan shall at Agreement expiration or termination be deemed to be part of the Center and sha�l become, at City's option, City's property, free of all liens and claims except as otherwise provided in this Agreement. If the City chooses not to accept improvements made by Licensee, during the term of this License, and prefers to have such imprcvements removed, Licensee shall do so at its sole cost and expense. 6.8 Breach bv Licensee. Licensee's refusal or failure to meet its obligations under this Section 6 shall be deemed a breach of this Agreement, and in such event, City may, in addition to any other remedies it may have at law or equity, terminate this Agreement pursuant to the provision of Section 7.10 or elsewhere herein. SECTION 7: GENERAL PROVISIONS 7.1 Notices. All notices, demands, requests, consents or other communications which this Agreement contemplates or authorizes, or requires or permits either party to give to the other, shail be in writing and shall be personally delivered or mailed, postage prepaid, to the respective party as follows: Page 10 i2iaizois Cool Down Coffee License&Faality Agreement 18-16 To City: To Licensee: Rick Ryals Cool Down Coffee Real Property Manager 1390 Santa Alicia Avenue, Apt. 5301 City of Chula Vista Chula Vista, CA 91913 Department of Public Works Attention: Alejandro Welti 276 Fourth Avenue Phone: (619)651-7389 Chula Vista, CA 91910 alexw@cooldowncoffee.com Either party may change its address by notice to the other party as provided herein. Communications shall be deemed to have been given and received on the first to occur of: (i) actual receipt at the offices of the party to whom the communication is to be sent, as designated above; or (ii) three working days following the deposit in the United States Mail of ceRified mail, postage prepaid, return receipt requested, addressed to the o�ces of the party to whom the communication is to be sent, as designated above, or (iii) actual receipt if made by recognized reliable currier service who maintains a receipt of delivery. 7.2 Citv Approval. The City's Property Manager or designee shall be the City's authorized representative in the interpretation and enforcement of all work performed in connection with this Agreement. 7.3 Nondiscrimination. Licensee agrees not to discriminate in any manner against or segregation of any person or persons, on account of race, color, religion, sex, familiar status, national origin, ancestry, age, disability or sexual orientation in the use, occupancy, tenure or enjoyment of the Center, nor shall Licensee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of the Center. 7.4 Equal Opportunity. Licensee shall assure applicants are employed and that employees are treated during employment without regard to race, familial status, color, religion, sex or national origin. Licensee hereby certify to City that Licensee is in compliance and throughout the term of this Agreement will comply with Title VII of the Civil Rights Act of 1964, as amended, the California Fair Employment Practices Act, and any other applicable Federal, State and Locai law, regulation and policy (including without limitation those adopted by City) related to equal employment and oppoRunity including any such law, regulation, and policy hereinafter enacted. a. Compliance and performance by Licensee of the equal employment and opportunity provision of this Agreement is an express condition hereof and any. failure by Licensee to so comply and perform shall be a default of this Agreement and City may exercise any right as provided herein and as otherwise provided by law. 7.5 Entire Aqreement. This Agreement comprises the entire integrated understanding between City and Licensee concerning the use and occupation of the Center and the Premises and supersedes all prior negotiations, representations, or agreements. Each party has relied on its own examination of the Center and the Premises, advice from its own attorneys, and the warranties, representations, and covenants of the Agreement itself. Page 11 �varzois Cool Down Coffee Licens_8 Facility Agreement 18-17 7.6 Interpretation of the Aqreement. The interpretation, validity and enforcement of the Agreement shall be governed by and construed under the laws of the State of California. The Agreement does not limit any other rights or remedies available to City. a. Licensee shail be responsible for complying with all Local, State, and Federal laws whether or not said laws are expressly stated or referred to herein. b. Should any provision herein be found or deemed to be invalid, the Agreement shall be construed as not containing such provision, and all other provisions which are otherwise lawful shall remain in full force and effect, and to this end the provisions of this Agreement are severable. c. This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and assigns. 7.7 Aareement Modification. This Agreement may not be modified orally or in any manner other than by an agreement in writing signed by the PaRies hereto. 7.8 Attornevs' Fees. In the event a suit is commenced by City against Licensee to enforce payment of amounts due, or to enforce any of the terms and conditions hereof, or in case City shall commence summary action under the laws of the State of California relating to the unlawful detention of Center or the Premises, for forfeit of this Agreement, and the possession of the Center or the Premises, provided City effects a recovery, Licensee shall pay City all reasonable costs expended in any action, together with a reasonable attorney's fee to be fixed by the court. Venue for any such suit or action shall be California Superior Court, San Diego County, North County Branch. 7.9 Assiqnment and Sublettinq-No Encumbrance. This Agreement and any portion thereof shall not be assigned, transferred, or sublet, nor shall any of the Licensee's duties be delegated, without the express written consent of City in its sole discretion. Any attempt to assign or delegate this Agreement without the express written consent of City shall be void and of no force or effect. A consent by City to one assignment, transfer, sublease, or delegation shall not be deemed to be a consent to any subsequent assignment, transfer, sublease, or delegation. 7.10 Defaults and Termination. If City has a good faith belief that Licensee is not complying with the terms of this Agreement, City shall give written notice of the default (with reasonable specificity) to Licensee and demand the default to be cured within ten (10) days of the notice. If Licensee is actually in default of this Agreement and fails to cure the default within ten (10) days of the notice, or, if more than ten (10) days are reasonably required to cure the default and Licensee fails to give adequate assurance of due performance within ten (10) days of the notice, City may terminate this Agreement upon written notice to Licensee. City may also terminate this Agreement upon written notice to Licensee in the event that: a. Licensee has previously been notified by City of Licensee's default under this Agreement and Licensee, after beginning to cure the default, fails to diligentiy pursue the cure of the default to completion; or Page 12 �zia�zois Cool Down Coffee License&Faality Agreement 18-18 b. Licensee shall voluntarily file or have involuntarily filed against it any petition under any bankruptcy or insolvency act or law; or c. Licensee shall be adjudicated a bankruptcy; or d. Licensee shall make a general assignment for the benefit of creditors. Upon termination, City may immediately enter and take possession of the Center and the Premises. 7.11 No Waiver. The failure to require the remedy of a breach or enforce the terms and conditions of this Agreement in one instance or several instances shall not be interpreted to be a waiver of the right to enforce the terms and conditions of this Agreement for any subsequent breach. 7.12 Other Requlations. All use of the Center and the Premises by Licensee under this Agreement shall be in accordance with the laws of the United States of America, the State of California, the County of San Diego, and in accordance with all applicative rules and regulations and ordinances of the City of Chula Vista now in force, or hereinafter prescribed or promulgated by resolution or ordinance or by Local, State or Federal law. 7.13 Time is of Essence: Provisions Bindinq on Successors. Time is of the essence of ali of the terms, covenants and conditions of this Agreement and, except as otherwise provided herein, all of the terms, covenants and conditions of this Agreement shall apply to, benefit and bind the successors and assigns of the respective Parties, jointly and individually. 7.14 Section Headincas. The Table of Contents and the section headings contained herein are for convenience only and are not intended to define or limit the scope of any provision thereof. 7.15 Gender/Sinpular/Plural. The neuter gender includes the feminine and masculine, the masculine includes the feminine and neuter, and the feminine includes the masculine and neuter, and each includes corporation, partnership, or other legal entity when the context so requires. The singular number includes the plural whenever the context so requires. 7.16 Non-liabilitv of Officials. No member, o�cial or employee of the City or MTS shall be personally liable to Licensee, its assigns or successors in interest, in the event of any default or breach by the City, for any amount which may become due to Licensee its assigns or successors, or in any obligations under the terms of this Agreement. 7.17 Relationship between Citv and Licensee. It is hereby acknowledged that the relationship between City and Licensee is that of landowner and tenant at wiil and not that of a partnership or joint venture and that City and Licensee shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided herein, the City shall have no duties or obligations with respect to the improvement, maintenance or upkeep of the Center or the Premises. 7.18 Administrative Claims Requirements and Procedures. No suit or arbitration shail be brought arising out of this agreement, against the City unless a claim has first been Page 13 � �zraaois Cool Down Coffee License 8 Facility Agreement � 18-19 presented in writing and filed with the City and acted upon by the City in accordance with the procedures set forth in Chapter 1.34 of the Chula Vista Municipal Code, as same may from time to time be amended, the provisions of which are incorporated by this reference as if fully set forth herein, and such policies and procedures used by the City in the implementation of same. Upon request by City, Consultant shall meet and confer in good faith with City for the purpose of resolving any dispute over the terms of this Agreement. 7.19 Siqnatories. The individuals executing this Agreement represent and warrant that they have the right, power, legal capacity and authority to enter into and to execute this Agreement on behalf of the respective legal entities of the Licensee and the City. [NEXT PAGE IS SIGNATURE PAGE] Page 14 �ziaizois Cool Down Coffee License 8 FacilRy Agreement 18-20 SIGNATURE PAGE TO LICENSE AND FACILITY OVERSIGHT AGREEMENT IN WITNESS WHEREOF the Parties hereto for themselves, their heirs, executors, administrators, successors, and assigns do hereby agree to the full performance of the covenants herein contained and have caused this Agreement to be executed as of, but not necessarily on, the Effective Date by setting hereunto their signatures herein below. City of Chula Vista By: Cheryl Cox, Mayor Attest: Donna Norris, City Clerk Approved as to form: Glen R. Googins, City Attorney LICENSEE: AYAWEL USA, LLC By: Alejandro Welti, CEO Page 15 iziano�s Cool Down Coffee License&Facility Agreement 18-21 � . '� ' , .. •' :F� : i. :•T , - L , � i .�� _ . - . . -- • - ` � " `.. ;. .' +--. i i i — - . ; : �. ;. � .._� — • . .. � � ; i � . , �. . . : . . ; • � i , „ �. ` i> • " � . • , . . � ' �---,�, -- _ ' � � _ — �,:-�--� . � . 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Exhibit B Pre-Occupancv "PLAN" (List of Permanent and Fixed Improvements or Proposed Alterationsl Cool Down Coffee Construction Proposal for 750 E Street; (subject to City approval) • Outdoor Walis; Patch and Paint stucco areas, clean and seal bricks (will not paint) • Interior Walls; Patch and paint the painted interior finishes (will not paint bare wood ceiling or other non-painted surfaces, Repair and or replace tile on interior walls • Interior Flooring; repair and replace in counter area as needed • Counters/utilities; adapt or rebuild counters and supply room areas to add plumbing, electrical and structural for a coffee bar, sink(s) and lighting - • Renovating bathrooms; replace partition walls, add wainscoting and repair replace fixtures as desired • Decorate and add atmosphere; Music, TV, Wi-Fi services. (City to supply N's for MTSW/City information) • Exterior Terraces; prepare irrigation/utilities and pour concrete pads to create terraces from exterior bathroom entrances to wrap building on North, South and West sides of building • Renovation of landscape irrigation system; add plant material to beds and or planters to define and decorate terrace areas adjacent building and repair/ establish irrigation and provide maintenance to material added • Construct trash Enclosure for service . Installation of(LED or similar energy efficient) exterior signs on building and 2 monument signs at E St entrances • Repair and replace glass entrance doors on North, South and west of building with same style doors as needed Page 17 izra�zo�s Cool Down Coffee License&Facility Agreement 18-23 Exhibit C Proposed Hours of Operation Monday-Friday 5:30am-9:OOpm Saturday 6:30am-9:OOpm Sunday 7:OOam-8:OOpm Page 18 12/42013 Cool Down Coffee License&Faciiity Agreement 18-24 u-. '�, . _. 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