Loading...
HomeMy WebLinkAboutGilroy Golf Course - Agreement for Golf Course ServicesAGREEMENT FOR GOLF COURSE SERVICES This Agreement for Golf Course Services ( "Agreement ") is dated and effective as of January 1, 2012, by and between the City of Gilroy, a municipal corporation ( "City ") and Gilroy Golf Course, Inc., a California corporation ( "Consultant "). The City and Consultant may be referred to individually as a Party or jointly as the Parties. WHEREAS, City and Consultant entered into that certain Amended and Restated Agreement For Golf Course Services By and Between the City of Gilroy and Don DeLorenzo dated and signed by City on November 15, 2004 and by Consultant on November 9, 2004 (the "Prior Agreement "), which Prior Agreement terminated effective as of December 31, 2011. WHEREAS, City and Consultant desire to enter into this Agreement effective as of January 1, 2012. NOW THEREFORE, the Parties do agree as follows: Article 1. Definitions As used in this Agreement, the following words and phrases, unless otherwise provided, shall have the following meanings: (a) Day: Calendar day. (b) Director: The Finance Director for the City of Gilroy, or his or her designee, or if the City is without a Finance Director, the City Administrator. (c) Golf Course: The 11 -hole municipal golf course located at 2695 Hecker Pass Highway in Gilroy, California, and commonly referred to as the City of Gilroy Golf Course. (d) Clubhouse: The golf pro shop, which includes a golf shop, snack bar, kitchen, office and restrooms. (e) Residence: The single - family residence located on the Golf Course. Article 2. Term of Agreement, Termination of Prior Agreement. (a) Tenn of Agreement. Upon execution of this Agreement by City and Consultant, this Agreement shall be deemed effective as of January 1, 2012, and will continue in effect through December 31, 2016, unless terminated prior to that date in accordance with the provisions of Article 8 of this Agreement or extended by mutual written consent of the Parties. If this Agreement has not sooner terminated or expired, the Parties may mutually agree (each determined in its sole and absolute discretion, without any obligation on the part of either Party to do so, and without any liability to the other Party for failing to do so) to extend this Agreement for one (1) additional period of five (5) years, at the rates set forth in Exhibit "C" Compensation or at such other rates as may be mutually agreed to by the Parties (each determined in its sole and absolute discretion, without any obligation on the part of either Party to do so, and without any liability to the other Party for IKKS11034286.2 1 022812 - 04706092 failing to do so), subject however to sooner tennination in accordance with the terns and conditions of this Agreement (including without limitation Sections 8(a) and 8(b) below). (b) Termination of Prior Agreement. The Parties acknowledge and agree that the Prior Agreement terminated effective as of December 31, 2011. Article 3. Independent Consultant Status. It is the express intention of the Parties that Consultant is an independent contractor and not an employee, agent, joint venturer or partner of City. Nothing in this Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between City and Consultant or any agents, employees, assistants, subconsultants, contractors, or licensees of Consultant. Both parties acknowledge that Consultant is not an employee for state or federal tax purposes. Consultant shall not be entitled to any of the rights or benefits afforded to City's employees, including, without limitation, disability or unemployment insurance, workers' compensation, medical insurance, sick leave, retirement benefits or any other employment benefits. Consultant shall retain the right to perform services for others during the tern of this Agreement. Article 4. Services to Be Performed by Consultant. (a) Specific Services. Consultant shall perform the services described in this Agreement, including but not limited to the services outlined in Exhibit "A" ( "Specific Provisions ") and Exhibit "B" ( "Scope of Services "), both of which exhibits are incorporated herein by this reference. (b) Method of Perforning Services. Consultant shall detennine the method, details and means of perforning the above - described services. City shall have no right to, and shall not, control the manner or determine the method of accomplishing Consultant's services. (c) Employment of Assistants. Consultant may, at the Consultant's own expense, employ such assistants as Consultant deems necessary to perform the services required of Consultant by this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 6 below. City may not control, direct, or supervise Consultant's assistants in the perfonnance of those services. Consultant assumes full and sole responsibility for the payment of all compensation and expenses of these assistants and for all state and federal income tax, unemployment insurance, Social Security, disability insurance and other applicable withholding. IKK&1034286.2 022812 - 04706092 _2_ (d) Place of Work. Consultant shall perform the services required by this Agreement at any place or location and at such times as Consultant shall determine is necessary to properly and timely perform Consultant's services. Article 5. Compensation. (a) Consultant to Retain Gross Receipts. In consideration for the services to be performed by Consultant, City agrees that Consultant shall collect and retain all Gross Receipts (defined in Exhibit "C "), as provided in Exhibit "C," "Compensation," which is incorporated by this reference and made a part of this Agreement hereby. (b) Consultant to Make Payments to City. In consideration for Consultant's right to use the Golf Course property owned by the City as provided hereunder, Consultant agrees to make payments to the City as provided in Exhibit "C," "Compensation." (c) Expenses. Consultant shall be responsible for all costs and expenses incident to the performance of services hereunder, including but not limited to, all costs of equipment used or provided by Consultant, all fees, fines, licenses, bonds or taxes required of or imposed upon Consultant and for all other of Consultant's costs of doing business. The City shall not be responsible for any portion of any expenses incurred by Consultant in performing services for City. Article 6. Obligations of Consultant. (a) Compliance with Laws and Policies. Consultant shall perform each duty and obligation imposed herein in full compliance with the Gilroy City Code and other ordinances of the City, and all federal, state and local laws, statutes, rules, regulations and orders, including, but not limited to, laws, statutes, rules, regulations and orders pertaining to the environment, labor and wage standards, non- discrimination in employment and toward members of the public, injury, accident, safety, payroll, and accounts payable. Consultant shall abide by policies, rules and regulations promulgated by City, and by other applicable standards, including health and safety standards. Consultant shall obtain and maintain a Gilroy Municipal Business License. (b) Standard of Perfornance. (1) Golf Course Services. Consultant agrees to provide a high standard of performance in the execution of all obligations and duties under this Agreement, particularly MS11034286.2 022812 - 04706092 -� with respect to service given directly to players and the public utilizing the Golf Course, and equipment, supplies and materials provided or used. Consultant shall assure that the Golf Course is maintained at an equal or higher standard than the Golf Course is maintained immediately preceding the effective date of this Agreement. The City reserves the right to set and change standards of performance for the operation and maintenance of the Golf Course. (ii) Repair and Maintenance of Structures and Facilities on Golf Course Property. Consultant shall have full and sole responsibility for the repair and maintenance of all structures, amenities and facilities at the Golf Course including, but not limited to, the following structures, amenities and facilities: the Residence; the Clubhouse; any and all buildings and fences; utilities, including without limitation water, sewer and recycled water; fairways; greens; tees; carts; parking and driving areas; and pedestrian walkways and cart paths. It is the express intent of the Parties that the City cease to have any responsibility for repairs or maintenance at the Golf Course and that Consultant have sole responsibility to make repairs and maintain the Golf Course, with the sole exception being that the City will be responsible for the replacement of the septic tank and septic system if and when either fails or connection to the City sewer system at the property line when available. (c) Workers' Compensation. Consultant agrees to provide workers' compensation insurance for Consultant's employees and agents and agrees to hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees from and against any and all claims, suits, damages, costs, expenses, fees, demands, awards, causes of action, losses, fines, penalties, and liabilities including without limitation attorneys' fees (collectively, "Claims "), arising out of any injury, disability, or death of any of Consultant's employees and agents. Consultant's indemnification, defense and hold harmless obligations under this subsection (c) shall survive the termination of this Agreement. (d) Indemnification of Liabilit,Duty, to Defend. To the fullest extent permitted by law, Consultant shall hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees against any and all Claims, including without limitation all Claims relating to the injury or death of any person or damage to any property, to the extent arising or resulting directly or indirectly from (1) any act or omission of Consultant or Consultant's agents, employees, assistants, subconsultants, contractors, invitees, or licensees, (ii) any occurrence, activity or condition at or in any way related to the Golf Course, or (iii) any breach of Consultant's obligations under this Agreement. The provisions of this subsection (d) shall survive the termination of this Agreement. (e) Insurance. (1) Insurance Mandatory. Consultant shall procure and maintain for the duration of this Agreement insurance against claims for injuries to persons or damages to property which may arise from or Ili connection with any occurrence, activity or condition at or concerning the Golf Course or any 1KK&1034286.2 022812 - 04706092 -4- structure, amenity or facility of any kind or type thereon, or the performance of the services, work and operations by the Consultant, his agents, employees, assistants, subconsultants, or contractors and the results of those services, work and operations. (ii) Minimum Scope of Insurance. Coverage shall be at least as broad as: (A) Insurance Services Office Fonn CG 0001 covering Commercial General Liability on an "occurrence" basis. (B) Insurance Services Office Form Number CA 0001 covering Automobile Liability, Code 1 (any auto), or Code 8 (hired) and 9 (non- owned) if Consultant has no owned autos. (C) Workers' Compensation insurance as required by the State of California. (D) Employer's Liability Insurance. (E) Property insurance against all risks of loss to all buildings on the Golf Course property and to tenant improvements or bettennents. (iii) Minimum Limits of Insurance. Consultant shall maintain limits no less than: (A) General Liability: (Including products - completed operations, personal & advertising injury) $1,000,000 per occurrence for bodily 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 separately to this project /location or the general aggregate limit shall be twice the required occurrence limit. (B) Automobile Liability: $1,000,000 per accident for bodily injury and property damage. (C) Employer's Liability: $1,000,000 per accident for bodily injury or disease. (D) Property Insurance: Full replacement cost with no coinsurance penalty provision. 1KKS11034286.2 5 022812 - 04706092 (iv) Deductibles and Self- Insured Retentions. Any deductibles or self - insured retentions must be declared to and approved by the City. The City may require the Consultant to provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. (v) Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions: (A) The City, its officers, officials, employees, and volunteers are to be covered as additional insureds with respect to liability arising out of services, work or operations perfonned by or on behalf of the Consultant including materials, parts or equipment furnished in connection with such services, work or operations, and property insurance shall name City as loss payee. General liability coverage can be provided in the form of an endorsement to the Consultant's insurance (at least as broad as ISO Fonn CG 20 10 11 85). (B) For any claims related to the Golf Course, the Consultant's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, and volunteers. Any insurance or self - insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Consultant's insurance and shall not contribute with it. (C) The Consultant's insurance company agrees to waive all rights of subrogation against the City, its elected or appointed officers, officials, agents and employees for losses paid under the terms of any policy which arise from work perfonned by the named insured under this Agreement. This provision also applies to the Consultant's Workers' Compensation policy. (D) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be canceled by either Party, except after thirty (30) days' prior written notice (10 days for non - payinent) by certified mail, return receipt requested, has been given to the City. (vi) Acceptability of Insurers. Insurance is to be placed with an admitted insurer with a current A.M. Best's rating of no less than ANI I. 1KKS11034286,2 022812 - 04706092 -6- (vii) Verification of Coverage. Consultant shall furnish the City with original certificates and amendatory endorsements effecting coverage required by this clause. All certificates and endorsements are to be received and approved by the City before work commences. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications, at any time. (f) Assignment. Notwithstanding any other provision of this Agreement, neither this Agreement nor any duties or obligations of Consultant under this Agreement may be assigned or subcontracted by Consultant without the prior written approval of City, which City may withhold in its sole and absolute discretion. (g) State and Federal Taxes. As Consultant is not City's employee, Consultant shall be responsible for paying all required state and federal taxes. Without limiting the foregoing, Consultant acknowledges and agrees that: • City will not withhold FICA (Social Security) from Consultant's payments; • City will not make state or federal unemployment insurance contributions on Consultant's behalf, • City will not withhold state or federal income tax from any payment City might make to Consultant; • City will not make disability insurance contributions on behalf of Consultant; • City will not obtain workers' compensation insurance on behalf of Consultant. Article 7. Obligations of City. (a) Cooperation of City. City agrees to respond to all reasonable requests of Consultant and provide access, at reasonable times following receipt by City of reasonable notice, to all documents reasonably necessary to performance of Consultant's duties under this Agreement. (b) Assi ng ment. City may assign this Agreement or any duties or obligations hereunder without the consent of Consultant. Such assignment shall not relieve Consultant from any of Consultant's duties or obligations under this Agreement. IKKS11034286.2 022812 - 04706092 _ 7 Article 8. Termination of Agreement. (a) Termination on Occurrence of Stated Events. This Agreement will terminate on the occurrence of any of the following events: (i) At City's option, upon the bankruptcy of either Party. (ii) Upon the death of Consultant or if Consultant, whether by reason of incapacity or otherwise, is unable to perform, or reasonably can be expected to be unable to perform, the duties, obligations, covenants, or agreements herein for a period of thirty (30) consecutive days. Upon termination resulting from such an event, the City hereby is given the first option to buy out at fair market value any inventory existing on the Golf Course property just prior to the event triggering the tennination of this Agreement. If Consultant, by reason of incapacity or other event or condition or circumstance, reasonably is expected to be unable or unwilling to personally perfonn the duties, obligations, covenants, or agreements herein, the City may immediately tenninate this Agreement upon three (3) days' written notice. (iii) At City's option, upon the event of a national, state, or local emergency or act of God which in the reasonable detennination of City ends the need for continuing Golf Course operations. (iv) At City's option, upon the sale or transfer of the Golf Course real property to a third party. (b) Termination by City for Default of Consultant. Should Consultant default in the performance of this Agreement or materially breach any of its provisions, City, at City's option, may tenninate this Agreement by giving written notification to Consultant. For the purposes of this section, material breach of this Agreement shall include, but not be limited to the following: (i) Consultant's failure to professionally and /or timely perfonn any of the services contemplated by this Agreement. (ii) Consultant's breach of any of its representations, warranties or covenants contained in this Agreement. (iii) Consultant's failure to timely make one or more payment(s) to City when due. (iv) A decline, after the effective date of this Agreement, in the maintenance or condition of, or services provided at, the Golf Course, or in the physical condition of any strictures, amenities and facilities located on the Golf Course, as reasonably detennined by City. (v) Failure to perform the maintenance and improvements obligations stated in Article 6 and elsewhere in this Agreement. 1KKS11034286 2 022812- 04706092 -�- (vi) Failure or refusal of Consultant to maintain all books and records in accordance with standard California accounting practices or to submit to audit of Consultant's books and records (including, but not limited to, invoices, vouchers, cancelled checks, time cards, receipts, sales records, and similar documents), as required by Section IIIB of Exhibit "A" of this Agreement. In the event of Consultant's default, City shall be entitled to pursue any and all remedies available to City at law or in equity. Consultant shall be entitled to payment out of Gross Receipts, as defined hereinafter in Exhibit "C ", only for services satisfactorily performed through the date of tennination, as reasonably determined by City or adjudged by a court. (c) Transition After Termination. Upon termination, Consultant shall immediately stop work, unless cessation could potentially cause any damage or harm to person or property, in which case Consultant shall cease such work as soon as it is safe to do so. Consultant shall incur no further expenses in connection with this Agreement, Consultant shall reimburse City, within ten (10) days after demand, for any and all costs and expenses incurred by City in order to complete the tasks that Consultant is obligated to perform under this Agreement, and such reimbursement shall include Gross Receipts as hereinafter defined in Exhibit "C ", to the extent that such Gross Receipts constitute payment for services not yet rendered. Upon tennination of this Agreement, Consultant shall reimburse City to the extent that Gross Receipts received constitute payment for services not yet rendered and reimburse City on a pro rata basis for the unexpired portion of all annual, semi- annual, monthly and /or quarterly passes sold to date. Consultant shall act in such a manner as to facilitate any new Consultant's assumption of duties. Article 9. General Provisions. (a) Amendment & Modification. No amendments, modifications, alterations or changes to the terms of this Agreement shall be effective unless and until made in a writing signed by both Parties hereto. (b) Americans with Disabilities Act of 1990. Throughout the term of this Agreement, the Consultant shall comply fully with all applicable provisions of the Americans With Disabilities Act of 1990 ( "the Act ") in its current form and as it may be amended from time to time. Consultant shall also require such compliance of all subconsultants performing work under this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 6 above. The Consultant shall hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees from and against all Claims that may arise out of any violations of the Act by the Consultant, or Consultant's agents, employees, assistants, subconsultants, licensees or contractors. IKKS11034286.2 022812 - 04706092 -� (c) Attorneys' Fees. If any action at law or in equity, including without limitation an action for declaratory relief, is brought to enforce or interpret the provisions of this Agreement, the prevailing party will be entitled to reasonable attorneys' fees, which may be set by the court in the same action or in a separate action brought for that purpose, in addition to any other relief to which that Party may be entitled. (d) Captions. The captions and headings of the various sections, paragraphs and subparagraphs of the Agreement are for convenience only and shall not be considered nor referred to for resolving questions of interpretation. (e) Conflict of Interest. Consultant certifies that to the best of its knowledge, no City employee or office of any public agency interested in this Agreement has any pecuniary interest in the business of Consultant and that no person associated with Consultant has any interest that would constitute a conflict of interest in any manner or degree as to the execution or performance of this Agreement. (f) Emergency Services. Consultant shall provide Director with names, telephone numbers and pager numbers of at least two (2) qualified employees or principals of Consultant who are available on a twenty -four (24) hour basis when conditions occur requiring emergency maintenance during hours when Consultant's nonnal workforce is not present. During any period of severe inclement weather conditions, Consultant will provide sufficient personnel on a twenty -four (24) hour call basis for the purposes of sandbagging, drainage clearance, and /or other tasks required to prevent serious damage to Golf Course improvements, grounds and facilities. (g) Entire Agreement. This Agreement supersedes any and all prior agreements, whether oral or written, between the parties hereto with respect to the rendering of services by Consultant for City with respect to the subject matter contained in this Agreement and contains all the covenants and agreements between the parties with respect to the rendering of such services in any manner whatsoever. Each Party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding. No other agreements or conversation with any officer, agent or employee of City prior to execution of this Agreement shall affect or modify any of the terms or obligations contained in any documents comprising this Agreement. Such other agreements or conversations shall be considered as unofficial information and in no way binding upon City. IKKS11034286,2 10 022812 - 04706092 (h) Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of California. (1) Hazardous Substances. (i) Consultant represents and warrants that the services it and any subconsultant will provide, the methods of application it and any subconsultant will use, and the products it and any subconsultant will use will not violate and will comply with any federal, state, or local environmental laws, statutes, ordinances, codes, rules, regulations, order, decrees or similar authoritative pronouncements now or hereafter in effect. Consultant shall obtain and keep current a hazardous material storage permit from the Gilroy Chemical Control Program for all Hazardous Substances used or stored on the Golf Course (the "Hazardous Materials Storage Permit "). All requirements and conditions of the Hazardous Materials Storage Pen-nit shall be the responsibility of Consultant. For purposes of this Agreement, "Hazardous Substances" shall mean any and all substances, materials or wastes (whether liquid, solid or gaseous or otherwise), which are a pollutant or contaminant, or which are hazardous, toxic, ignitable, reactive, corrosive, dangerous, harmful or injurious, or which present a risk to public health or the environment, or which are or may become regulated by or under the authority of any Environmental Laws, as defined below, including, without limitation, asbestos or asbestos containing materials, petroleum products, pesticides, polychlorinated biphenyls, flammable explosives, radioactive materials and urea formaldehyde. As used herein, the tenn "Environmental Laws" shall mean any present or future federal, state or local laws, whether common law, statute, rule, regulation or ordinance, judgment, order, or other governmental restriction, guideline, listing or requirement, relating to the environment or any Hazardous Substances, including without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §6901 et seq., Federal Water Pollution Control Act, 33 U.S.C. Section 1251, et sec ., and applicable provisions of the California Health and Safety Code and the California Water Code, all as they currently exist or may hereafter be amended from time to time. (ii) Consultant hereby agrees to defend with counsel reasonably acceptable to City, indemnify and hold City and City's officers, representatives, agents and employees harmless from and against any and all Claims as a result of violations of this Article 9. The provisions of this subsection (ii) and (iii) of this Article 9 shall survive the termination of this Agreement. (iii) The indemnification, defense and hold harmless obligations under this Article 9 shall include, but not be limited to, any and all Claims directly or indirectly resulting from the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission or release from or on, the Golf Course of any Hazardous Substances caused by or within the control of Consultant, or any of Consultant's agents, employees, assistants, subconsultants, contractors, invitees, or licensees. US11034286.2 -1 1- 022812- 04706092 (iv) If Consultant causes, knows of, or receives any written or verbal notice of the happening of any event following the use, spill, release, leak, seepage, discharge or cleanup of any governmental authority which notice lists any noncompliance, order, citation or notice with regard to air emissions, water discharges, or any other environmental, health or safety matter affecting the Golf Course or City (an "Environmental Complaint ") from any person or entity (including without limitation, the EPA), Consultant shall immediately notify City orally and in writing of such notice, and provide any and all supporting information, document, complaint, or order regarding the same. (v) City shall have the right, but not the obligation and without limitation of City's rights under this Agreement, to enter onto the Golf Course and such other property as City deems advisable and /or necessary to take such actions as it deems necessary and /or advisable to clean up, remove, or minimize the impact of, or otherwise deal with, any such Hazardous Substances or Environmental Complaint following receipt of any notice from any person or entity (including, without limitation, the EPA) asserting the existence of any Hazardous Substances or an Environmental Complaint. All costs and expenses incurred by City in the exercise of any such rights shall be payable by Consultant to City upon demand if caused by or within the control of Consultant or any of Consultant's agents, employees, assistants, subconsultants, contractors, invitees, or licensees. (vi) Consultant shall include, in any contract entered into with a third party for services performed at the Golf Course, provisions substantially similar to the provisions contained in this section entitled "Hazardous Substances." (j) Construction of Agreement. The language of each and every paragraph, term and /or provision of this Agreement shall, in all cases and circumstances and for any and all purposes, be construed as a whole, according to its fair meaning, and shall not be construed for or against any Party hereto. The Parties agree that this Agreement has been negotiated and jointly drafted by the Parties hereto. (k) Notices. Any notice to be given hereunder by either Party to the other Party shall be effected either by personal delivery in writing or by United States mail, registered or certified, postage pre -paid with return receipt requested. Mailed notices shall be addressed to, and personally delivered notices shall be delivered to, the other Party at the address for such other Party appearing in Exhibit "A," Section III (G) Notices, but either Party may change the address by so notifying the other Party in writing in accordance with this subsection (k). Notices sent in the manner required by this subsection (k) shall be deemed delivered upon the earlier of actual receipt, the date the intended recipient refuses delivery, or the date of failed delivery due to incorrect contact information being provided to the delivering party by the intended recipient. (1) Time of the Essence. All dates and times referred to in this Agreement are of the essence. 1KKS11034286.2 022812 - 04706092 -12- (m) Work Not Performed Competently. If at any time City determines that any person employed by or under contract with Consultant to provide services within the scope of this Agreement has not performed or does not perform any work competently, City shall notify Consultant, who shall take immediate corrective action. Consultant shall be solely responsible for the hiring, supervision, training, disciplining, and termination of its employees. In the event of any litigation involving the City and an employee, or subconsultant of Consultant, Consultant shall indemnify, defend and hold harmless City and City's officers, employees, agents and representatives pursuant to the provisions stated in Article 6 of this Agreement. (n) Venue. Should either Party institute suit for enforcement or interpretation of any provision contained herein, the venue of such action shall be proper exclusively in State Superior Court in the County of Santa Clara, California. (o) Waiver. Consultant agrees that waiver by City of any one or more of the conditions of performance under this Agreement shall not be construed as waiver(s) of any other condition of performance under this Agreement. (p) Partial Invalidi If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions will nevertheless continue in full force without being impaired or invalidated in any way. [signatures appear starting on the next page] 1KKS11034286.2 -13- 022812 - 04706092 Executed at Gilroy, California. CONSULTANT: Gilroy Golf Course, Inc. a Calif i corp a ion By. Date: �d 2- Social Security or Taxpayer Identification Number 77' 053 U 937 Approved as to Form City Attorney 1KKS11034286.2 - 14- 022812- 04706092 CITY: CITY OV GILROY, a m ci al c rp t' P % 'l By: � .G �i Date: ATTEST: aZZ City Clerk Exhibit "A" Specific Provisions Pro /Manager. Consultant shall provide the services indicated on the attached Exhibit "B," Scope of Services, which is incorporated by this reference and made a part of this Agreement hereby. Consultant will personally perform or direct such services. Except as may be specified elsewhere in this Agreement, Consultant shall furnish all technical and professional services, including labor, material, equipment, transportation, supervision, expertise, and funding to perform or have performed all operations, maintenance and repairs necessary and required to complete the services required herein to the satisfaction of the City. I1. Direct Expenses. Except as otherwise specifically provided in this Agreement, Consultant shall be responsible for any and all direct and indirect expenses incurred in the operation, maintenance, and repair of the Golf Course on any structure, amenity, or facility. III. Other Provisions. A. Responsibility of Consultant. Consultant shall be responsible for all aspects of the operation of the Golf Course, and all services perfonned under this Agreement. No act or declination to act by the City shall be construed to operate as a waiver of any rights of City under this Agreement, or of any cause of action arising out of the performance of this Agreement. Consultant shall be and remain liable to City in accordance with applicable law for all damages or losses to City arising from Consultant's act or omission in connection with the perfonnance of any service furnished under this Agreement. B. Right of City to Inspect Records of Consultant /Duty of Consultant to Prepare and Maintain Records. City, through its authorized employees, representatives or agents, shall have the right, at any and all reasonable times, to review and audit Consultant's books and records (including, but not limited to, invoices, vouchers, cancelled checks, time cards, receipts, sales records, and similar documents) from time to time to verify Gross Receipts, as hereinafter defined, by giving Consultant not less than five (5) business days prior notice. Consultant shall prepare or cause to have prepared and shall maintain for a period of not less than three (3) years from the date of any transaction, all books and records in accordance with standard California accounting practices, all of which books and records shall be maintained and made available to 1KKS11034286.2 022812 - 04706092 City at the Golf Course. The provisions of this paragraph B shall survive the termination of this Agreement. C. Confidentiality of Material. All ideas, memoranda, specifications, plans, manufacturing procedures, data (including, but not limited to, computer data and source code), drawings, descriptions, documents, discussions or other information developed or received by or for Consultant and all other written and oral information developed or received by or for Consultant and all other written and oral information submitted to Consultant in connection with the performance of this Agreement shall be held confidential by Consultant and shall not, without the prior written consent of City, be used for any purposes other than the performance of services under this Agreement, nor be disclosed to an entity not connected with the performance of services under this Agreement. Nothing furnished to Consultant which is otherwise previously known to Consultant or is or becomes generally known to the related industry (other than that which becomes generally known as the result of Consultant's disclosure thereof) shall be deemed confidential. Consultant shall not use City's name or insignia, or distribute publicity pertaining to the services rendered under this Agreement in any magazine, trade paper, newspaper or other medium without the express written consent of City. D. No Pledging of f City's Credit. Under no circumstances shall Consultant have the authority or power to pledge the credit of City or incur any obligation in the name of City. E. Ownership of Material. All material including, but not limited to, computer information, data and source code, sketches, tracings, drawings, plans, diagrams, quantities, estimates, specifications, proposals, tests, maps, calculations, photographs, reports and other material developed, collected, prepared (or caused to be prepared) under this Agreement shall be the property of City, but Consultant may retain and use copies thereof subject to Paragraph B immediately above. City shall not be limited in any way in its use of said material at any time for any work, whether or not associated with this Agreement. F. No Third Party Beneficiary. This Agreement shall not be construed or deemed to be an agreement for the benefit of any third party or parties, and no third party or parties shall have any claim or right of action hereunder for any cause whatsoever. G. Notices. Notices are to be in writing and sent as follows: MV 034286.2 022812 - 04706092 -2- City: Finance Director City of Gilroy 7351 Rosanna Street Gilroy, CA 95020 Consultant: Gilroy Golf Course, Inc. 7171 Saratoga Place Gilroy, CA 95020 IKM1034286.2 022812 - 04706092 -� Exhibit "B" Scope of Services A. Golf Course Operational Duties. Consultant shall: 1. Maintain services and all property at the Golf Course at a level that meets or exceeds the standard of services and property maintenance in existence just before the effective date of this Agreement. To this end, Consultant will abide by perfonnance standards set by City governing the maintenance of the Golf Course and the structures thereon. Consultant will provide all repairs as reasonably detennined by City to be necessary to the clubhouse, cart shed, cart storage, maintenance area, irrigation pump, and other facilities at the Golf Course. 2. Prepare financial reports of all revenues received in a manner prescribed by City. 3. Register all golfers, membership, and daily fee round players prior to starting play. 4. Keep the Clubhouse open on a schedule of reasonable hours to provide food, refreshment, and equipment needs of the golfing public, maintain a snack bar and eating facilities. Hours shall be subject to prior approval by City. 5. Maintain a pro shop and have service available for the repair of golf equipment and a shop in which golf equipment may be purchased. 6. Represent the City's interest with respect to the men's and women's golf clubs. 7. Supervise all golf tournaments and special events at the course. 8. Supervise the junior golf program. 9. Make the Clubhouse available for golf association meetings during hours approved by City and other activities to promote a sound golf program. 10. Provide starting services for golfers. 11. Supervise and regulate play around the course when necessary to maintain speedy, consistent play. 12. Promote golf safety and good golf etiquette. 13. Keep the Clubhouse and course open anytime the course is playable and open. 14. Administer public relations and promotions of the Golf Course and its programs. 15. Prepare and maintain an inventory of all equipment owned by City. MS11034286,2 022812 - 04706092 16. Provide golf lessons for groups and individuals at a reasonable cost in line with other local courses. 17. Provide range balls and clubs for the range at a reasonable cost and be responsible for safety and supervision of the range. 18. Provide and maintain a sufficient number of pull carts for rent by golfers. 19. Provide and maintain in good running condition a sufficient number of self - propelled carts for rent by golfers. 20. Provide and maintain a sufficient number of golf clubs of at least average quality for rental to golfers. 21. Maintain current knowledge and methods of Golf Course operations. 22. As required by City, attend and provide assistance to meetings of the Gilroy Parks and Recreation Commission and City Council. 23. Supply, maintain in good condition, and rent to members of the public at reasonable rates the following Inventory: (a) Range balls; (b) Golf clubs; (c) Pull carts; and (d) Self- propelled golf carts. B. Utilities. (a) Recycled Water. The City will provide recycled water to the Golf Course for irrigation purposes. The Consultant shall use such water in the manner prescribed by the City to the greatest extent possible. (b) All Other Utiliti City shall provide and maintain potable water service to the City meter. Consultant, at his sole expense, shall furnish and maintain the potable water service from the City meter, and allow City to connect a new sewer service from the property line when available. Consultant shall furnish and maintain all other utilities to the Golf Course and structures thereon. Consultant may require any tenant of the Residence to reimburse him for utilities services to the Residence. Consultant shall not be excused from his obligation to make utility payments by reason of his inability to collect utility payments from any past or present tenant. IKKS11034286.2 022812 - 04706092 C. Hours of Operation. The hours of operation at the Golf Course, and any deviation therefrom, must be approved in writing by the City. D. Taxes. Consultant shall pay all taxes in any way associated with or relating to the Golf Course or any activity or structure thereon, or this Agreement, whether such tax is federal, state, county or local, including without limitation sales taxes and any taxes that may arise from Consultant's interest in the property, if any, and any possessory interest tax. In connection with California Revenue and Taxation Code section 107.6, City states and Consultant acknowledges that by entering into this Agreement, a possessory interest subject to property taxes may be created. Consultant or other parties in whom the possessory interest has vested may be subject to the payment of property taxes levied on such interest. E. Maintenance and Improvements. In addition to all other obligations of Consultant described in this Agreement, Consultant shall, at Consultant's sole cost and expense, perform the following maintenance and improvements to Golf Course, structures, amenities and facilities according to the following schedule: Maintenance /Improvement: Completion Schedule: 1. Residence: Repair exterior siding and paint entire December 31, 2013 exterior 2. Residence: Refinish wood floor December 31, 2013 3. Residence: Replace vinyl flooring in kitchen December 31, 2013 4. Metal Shop Building: Repair roll -up door June 30, 2012 5. Old Cart Shed: Repair or replace rotted posts and June 30, 2012 siding 6. Old Cart Shed: Provide structural support for roof June 30, 2012 along back wall as deemed appropriate by City Building Department 7. Fence along Bluebell Drive: Repair fence as June 30, 2012 necessary 8. Various: Remove dead trees, Hole #4, Hole #2, Hole June 30, 2012 #5, Driving Range 9. Clubhouse: Replace rotted deck boards June 30, 2012 10. Clubhouse: Maintain carpeting & flooring and On -going replace as necessary 11. Roof Inspect & maintain annually 1KKS11034286.2 022812 - 04706092 -3- Exhibit "C" Compensation A. COMPENSATION TO CONSULTANT Consultant shall collect and retain the Gross Receipts from the Golf Course during the term of this Agreement. "Gross Receipts" is hereby defined to mean all revenues or consideration of every kind and derived in any way whatsoever because of or in connection with Consultant's operation, use or management of the Golf Course property including, but not limited to, green fees, annual, semi - annual, monthly and quarterly passes sales, cart storage fees, clubhouse sales and services, including without limitation equipment rental and repair, driving range fees, sale of golf merchandise, pull carts and self - propelled carts rentals, and Residence rental. Consultant shall be compensated solely from the Gross Receipts and no moneys from any fund of the City shall be used to compensate Consultant or to fund Golf Course operations. B. COMPENSATION TO CITY Consultant shall pay to the City each year of the term of this Agreement an amount equal to the greater of (1) the Base Amount (defined below), or (ii) five percent (5 %) of Gross Receipts. As used in this Agreement, "Base Amount" shall mean: (1) for calendar year 2012, Forty One Thousand Four Hundred Eighty Three Dollars ($41,483.00), and (2) for each calendar year commencing in 2013, and continuing for each calendar year thereafter throughout the term of this Agreement, the Base Amount in effect immediately prior to January 1 of the year of adjustment shall be increased by a sum equal to the product obtained by multiplying such Base Amount by a fraction, the numerator of which is the Consumer Price Index (defined below) published nearest but prior to January 1 of the year of adjustment, and the denominator of which is the Consumer Price Index for the month nearest but prior to January I of the calendar year immediately preceding the year of adjustment. As used in this Agreement, "Consumer Price Index" means the Consumer Price Index (All Items) for All Urban Consumers as published by the United States Department of Labor, Bureau of Labor Statistics, for the San Francisco - Oakland -San Jose, California Area (base years 1982 -1984 = 100). If the Consumer Price Index is discontinued or revised, then such other governmental index or computation with which it is replaced shall be used. If the Consumer Price Index is discontinued but not replaced, then such other comparable price index selected by City shall be used. In no event shall a decrease in the Consumer Price Index result in a decrease in the Base Amount. Consultant shall pay the above amounts in arrears in five (5) equal installments of twenty percent (20 %) of the Base Amount each year of this agreement (each an "Installment Payment ", and collectively, the "Installment Payments "). The Installment Payments shall be due and payable on or before the 15`x' of the month following each of the following calendar inonths during the term of this Agreement: March, May, July, September and December. In addition, Consultant with each Installment Payment shall prepare and remit an accounting of Gross Receipts for the payment period just ended to accompany the Installment Payment, together with proof of work completed as required under Exhibit "B" Section E ( "Maintenance and Improvements "). On or before February 15 of each year beginning in the year 2013, Consultant shall submit to the City an accounting of all Gross Receipts for the previous year, together with (1) US11034286.2 -1- 022812- 04706092 proof that Consultant maintains insurance as required under Article 6 section (e), "Insurance," of this Agreement, and (2) any amount owed City for the previous year above the sum of the Installment Payments made in such prior year. All accountings required pursuant to this Section B shall be prepared by a Certified Public Accountant reasonably acceptable to the City and shall clearly set forth to the satisfaction of City the Gross Receipts from each source. if the City's review or audit of any of Consultant's books and records as provided for in Section II1.13 of Exhibit A of this Agreement indicates an underpayment of five percent (5 %) or greater of actual Gross Receipts received, the Consultant shall pay the cost of the City's review and audit upon demand. Any payments due from Consultant to the City shall bear simple interest at a rate of 1.5% per month. Nothing contained in this Exhibit "C" or in this Agreement shall be construed to extend this Agreement beyond December 31, 2016 or to obligate either Party to agree to an extension of this Agreement. The provisions of this Section (B) shall survive the termination of this Agreement. XKS11034286.2 022812 - 04706092 _2 _ GILRGOL -01 KRLO CERTIFICATE OF LIABILITY INSURANCE P TE /1612(MMIDD/YYYY) 8012 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). PRODUCER (559) 432 -0222 DIBuduo & DeFendis Insurance Brokers, LLC License #OE02096 P.O. Box 5478 Fresno, CA 93755 -5479 CONTACT PHONE FAX xt A1C No E-MAIL ADDRESS: INSURERS AFFORDING COVERAGE NAIL k INSURER A: Continental Insurance Company 35289 INSURED Gilroy Golf Course, Inc. 2695 Hecker Pass Hwy Gilroy, CA 95020- INSURER B: Valley Forge Insurance Co 20508 INSURER C: Star Insurance Company INSURERD: INSURER E f $ 1,000,00 INSURER F: X COMMERCIAL GENERAL LIABILITY COVERAGES CERTIFICATE NUMBER: REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR LTR TYPE OF INSURANCE AD POLICYNUMBER POLICY EFF MMIDDIYYYY POLICY EXP MMIDDIYY YY LIMITS GENERAL LIABILITY EACH OCCURRENCE $ 1,000,00 A X COMMERCIAL GENERAL LIABILITY X 2081244287 1/1/2012 1/1/2013 DAMAGE TO REN E PREMISES Ea occurrence $ 300,00 CLAIMS -MADE r—xl OCCUR MED EXP (Any one person) $ 5,04 PERSONAL & ADV INJURY $ 1,000,00 GENERALAGGREGATE $ 2,000,00 GEN'L AGGREGATE LIMIT APPLIES PER: PRODUCTS - COMPIOP AGG $ 2,000,00 $ X POLICY PRO LOC AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT Ea accldent $ 1,000,000 BODILY INJURY (Per person) $ B X ANY AUTO P2098127627 1/1/2012 111/2013 X ALL OWNED SCHEDULED AUTOS AUTOS BODILY INJURY (Per accident) $ PROPERTY DAMAGE Per accldent $ X HIREDAUTOS NON -OWNED AUTOS $ X $1,000 Comp a UMBRELLA LIAB OCCUR EACH OCCURRENCE $ AGGREGATE $ EXCESS LIAB CLAIMS -MADE DED I I RETENTION $ C WORKERS COMPENSATION AND EMPLOYERS' LIABILITY ANY PRRWEMB R EXCLUDED? ECUTIVEY� (Mandatory in NH) NIA WCMSTR5011958 4/10/2012 4/1012013 X WC STATU- OTH- TORY LIMITS ER L.L. EACH ACCIDENT $ 1,000,000 E.L. DISEASE - EA EMPLOYEE $ 1,000,000 E.L. DISEASE - POLICY LIMIT $ 1,000,000 If yes, describe under DESCRIPTION OF OPERATIONS belcw I A Businss Personal Property 2081244287 111/2012 111!2013 SF Incl RCIDed $1,000 $6100 A Inland Marine Incl Golf Equipt 2081244287 1/1/2012 1/1/2013 Ded $1,000 $210250 DESCRIPTION OF OPERATIONS J LOCATIONS ! VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) City of Gilroy, its officers, officials, employees and volunteers are named as Additional Insured with respects to General Liability as per attached form CG2026 0704.. City of Gilroy 7351 Rosanna St. Gilroy, CA 95020- TIO SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. AUTHORIZED REPRESENTATIVE ©1988 -2010 ACORD CORPORATION. All rights reserved. ACORD 25 (2010105) The ACORD name and logo are registered marks of ACORD Policy #: 2081244287 COMMERCIAL GENERAL LIABILITY CG 20 26 07 04 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY ADDITIONAL INSURED -- DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name of Additional Insured Persons Or Organization(s) City of Gilroy, its officers, officials, employees and volunteers 7351 Rosanna St. Gilroy, CA 95020 - information required to complete this Schedule, if not shown above, will be shown in the declarations. Section II — Who Is An Insured is amended to include as an additional insured the person(s) or organization(s) shown in the Schedule, but only with respect to liability for "bodily injury ", "property damage" or "personal and advertising injury" caused, in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf: A. In the performance of your ongoing operations; or B. In connection with your premises owned by or rented to you. CG 20 26 007 04 O ISO Properties, Inc., 2004 Page 1 of 1