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HomeMy WebLinkAbout09145RESOLUTION NO. 9145 A RESOLUTION APPROVING A MANAGEMENT AGREEMENT FOR THE OPERATION OF WALKINGSTICK GOLF COURSE RESTAURANT AND LOUNGE AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE THE SAME WHEREAS, proposals for the operation of the Walkingstick Golf Course restaurant and lounge have been received and examined; and WHEREAS, the proposal of M.C.A. Nacho's, Inc. of Pueblo, Colorado was determined to be in the best interest of the City; now therefore, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, COLORADO, THAT: SECTION 1. A management agreement for the operation of the Walkingstick Golf Course Restaurant and Lounge be, and same is hereby awarded to M.C.A. Nacho's, Inc. of Pueblo, Colorado. The awarding of the management agreement set forth herein shall be subject to the filing of sufficient performance bond to be approved by the Purchasing Agent of said City. RF,CTTnN 2_ The Management Agreement dated November 13, 2000 between the City and M.C.A. Nacho's, Inc., a copy of which is attached hereto, having been approved as to form by the City Attorney, is hereby approved. SECTION 3. The President of the City Council is authorized to execute the management agreement on behalf of Pueblo, a Municipal Corporation, and the City Clerk shall affix the seal of the City thereto and attest the same. INTRODUCED: November 13, 2000 ATTEST: City Clerk BY: Al Gurule _ Councilperson APPRO ED ,p J/ President of the City Council TITLE: A RESOLUTION APPROVING A MANAGEMENT AGREEMENT FOR THE OPERATION OF THE WALKINGSTICK GOLF COURSE RESTAURANT AND LOUNGE AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE THE SAME. ISSUE: Should the City Council award a contract for the operation of the Walkingstick Golf Course restaurant and lounge to M.C.A. Nacho's, Inc. of Pueblo, Colorado. BACKGROUND: The current contract for the operation of the Walkingstick Golf Course restaurant and lounge will terminate on December 31, 2000. Advertisement for bids for the operation of this facility was on October 2 and 9, 2000 with bids received on October 23, 2000. A mandatory pre -bid and facility walk -thru meeting was conducted on October 11, 2000 at which two interested parties attended. In general, the work consists of the management, maintenance, and operation of the restaurant and lounge at the Walkingstick Golf Course clubhouse. The restaurant management agreement is for a term of five (5) years from January 1, 2001 to December 31, 2005. It may be extended by the City Council for an additional five (5) year term by giving notice of such extension to the manager at least ninety (90) days prior to December 31, 2005. The operator will furnish all labor, inventory, supplies, products, tools, equipment and material and pay for all such items needed to operate the restaurant and lounge facility. Two bids were received on October 23, 2000. The bid proposal of M.C.A. Nacho's, Inc. was determined to be in the best interest of the City. A bid summary is attached. FINANCIAL IMPACT: M.C.A. Nacho's, Inc. will pay the City the greater of a minimum annual guarantee of $27,000 ($2,250/mo.) or 10% of gross sales up to $30,000 monthly plus 3% of gross sales in excess of $30,000 monthly. M.C.A. Nacho's, Inc. has also proposed to invest approximately $50,000 of their own funds for capital improvements to the restaurant and lounge facility. RECOMMENDATION: Approval of the resolution. k WALKINGSTICK MUNICIPAL GOLF COURSE RESTAURANT AND LOUNGE MANAGEMENT AGREEMENT THIS MANAGEMENT AGREEMENT entered into as of November 13, 2000, by and between the City of Pueblo, Colorado, a Municipal Corporation, 1 City Hall Place, Pueblo, Colorado, 81003, hereinafter referred to as the "City ", and M.C.A. Nachos, Inc., a Colorado corporation, whose principal place of business is 409 N. Santa Fe Avenue, Pueblo, Colorado, 81003, hereinafter referred to as the "Manager ". , WITNESSETH: WHEREAS, the City now owns and operates a municipal golf course which is open to public play and located on the premises commonly known as "Walkingstick Municipal Golf Course ", 4301 Walkingstick Boulevard, Pueblo, Colorado, (the "Golf Course ") and WHEREAS, there is located on the Golf Course a restaurant and lounge, and WHEREAS, the City desires to engage a qualified manager to manage, operate, maintain and promote the restaurant and lounge, and WHEREAS, Manager is qualified and capable of managing, promoting, maintaining and operating the restaurant and lounge; NOW, THEREFORE, in consideration of the foregoing and the mutual promises herein contained, the City and Manager agree as follows: As used herein, the following words and phrases shall have the following meaning: (a) "Leased Facilities" means and includes the restaurant, lounge, public restrooms and front entranceway located on the first floor of the Walkingstick Municipal Golf Course clubhouse consisting of approximately 2,532 square feet of floor area together with reasonable access to and use of the starter buildings located on the golf course and the gazebo located outside but adjacent to the clubhouse for the sale of restaurant food, and beverages, and the walk -in refrigerated room located in the basement of the clubhouse. (b) "Restaurant and lounge" means the restaurant and lounge located in the Leased Facilities. (c) "Director" means the City's Director of Parks and Recreation. (d) "Gross sales" means the entire amount of the sales price for cash or otherwise of all sales of merchandise, beverages, food and foodstuffs conducted in, at, on and from the Leased Facilities by Manager or any subtenant but excluding amounts collected and paid by Manager to any governmental authority for any sales taxes. Sales shall include without limitation (i) where the orders originate in, at, from or arising out of the use of the Leased Facilities whether delivery is made from the Leased Facilities or from some other place, and (ii) made or performed by means of mechanical or other vending devices in the Leased Facilities. 2. City hereby appoints and retains Manager, subject to and upon the terms and conditions herein set forth, as an independent contractor to operate, manage, maintain and promote the restaurant and lounge and the Leased Facilities for a term of five (5) years from January 1, 2001 to December 31, 2005, unless sooner terminated as herein provided. The term of this Agreement may be extended by the City Council of City for an additional five (5) year term upon City giving written notice of such extension to Manager at least ninety (90) days prior to December 31, 2005. During the effective period of this Agreement, Manager shall have the exclusive privilege to sell beverages, food and foodstuffs on the Leased Facilities. 3. Manager accepts said appointment and agrees to operate, manage, maintain and promote the restaurant and lounge and the Leased Facilities and perform the following covenants and services during the effective period of this Agreement: (a) Supervise and be responsible for all aspects of the operation, maintenance, management and promotion of the restaurant and lounge and all activities on the Leased Premises, including the efficient management and operation of the restaurant and lounge, and the maintenance and upkeep of the interior of the Leased Facilities in at least the same or better condition than presently existing. (b) Develop and implement efficient maintenance programs for the Leased Facilities including the custodial and interior maintenance of the Leased Facilities and all equipment and facilities located therein. (c) Develop and implement efficient management programs for the operation, scheduling of and use of the restaurant and lounge and Leased Facilities and the provision of services to the public including the presence of Manager's personnel. (d) Hire, supervise and schedule all employees needed and required for the efficient operation, maintenance, management and promotion of the restaurant and lounge and Leased Facilities. It is expressly understood and agreed that all employees hired by Manager shall be the employees of Manager and no contractual. obligations or relationship of employer- employee shall exist between the City and such employees. Manager shall provide all workers' compensation insurance for its employees in accordance with the provisions of the laws of the State of Colorado and furnish Director satisfactory proof that such insurance is in effect. (e) Be responsible for the security and inventory of, and maintain in good condition and repair, all City's beverage carts, equipment, fixtures and machinery used by Manager or placed under Manager's custody and control by City. An initial inventory of such beverage carts, machinery, fixtures, and equipment shall be prepared and signed by the Director and Manager and attached hereto. Director and Manager shall annually update such inventory. -2- (t) Keep and maintain accurate and complete accounts and records of all activities and transactions conducted by Manager on the Leased Facilities in accordance with generally accepted accounting principles, which accounts and records shall be available for inspection, copy and audit by City during normal business hours. Manager shall retain all such accounts and records for a minimum period of three (3) years after termination of this Agreement. (g) Keep the Leased Facilities and all fixtures and equipment therein in a clean, sanitary, safe and orderly condition. (h) Comply strictly with all applicable federal, state and City laws, rules and regulations. (i) Keep the restaurant and lounge and Leased Facilities open for business at such hours and times as the Golf Course is open for play and at such other hours and times as the Director and Manager shall from time to time determine. (j) Furnish prompt, courteous and efficient service adequate to meet all reasonable demands and needs of the public, ensuring polite and inoffensive conduct and demeanor on the part of its representatives, agents and employees. (k) Meet with the Director at least semi - annually to review the fees and charges being made by Manager for food and beverages, which fees and charges shall be reasonable and competitive with fees and charges for similar services and merchandise. Manager shall be directly responsible to the Director in all matters concerning the operation, maintenance, promotion and management of the restaurant and lounge and the use of the Leased Facilities. (1) Surrender and deliver to City, at the termination of this Agreement, the Leased Facilities and all City equipment in good order and condition, reasonable wear and tear excluded. (m) Maintain in force at Manager's sole cost during the effective period of this Agreement commercial liability insurance, including personal and bodily injury, blanket contractual, products liability, non -owned and hired automobile coverage, covering all activities conducted by Manager under this Agreement, in the minimum amount of $1,000,000 aggregate, per occurrence for personal and bodily injury and $500,000 aggregate, per occurrence for property damage. Certificates evidencing such insurance coverage and workers' compensation insurance shall be filed with the Director on or before the effective date of this Agreement and said certificates shall certify that such insurance coverage is in force and will not be cancelled or reduced without at least thirty (30) days prior written notice to City and that the City is named as an additional insured under the policies of liability insurance. At least ten (10) days prior to the expiration of any such insurance, a certificate showing such insurance has been renewed or extended shall be filed with the Director. (n) Carry, furnish, provide and replace as needed, at Manager's sole cost and risk sufficient and adequate food, foodstuffs, beverages, equipment, furnishings and furniture in the Leased Facilities as determined necessary by the Manager and Director to meet the reasonable needs -3- and demands of the public, including without limitation, (i) tables, chairs, glasses, dishes and utensils for the restaurant and lounge, (ii) beverages, food and foodstuff for breakfast, lunch and dinner menus and banquets. The Director shall approve the quality, quantity and decor of equipment, furniture, furnishings and fixtures prior to their purchase and placement thereof on the Leased Facilities by Manager. Manager and Director shall prepare and sign an inventory of equipment, furnishings, furniture and fixtures to be supplied and furnished by Manager and annually update such inventory. (o) Pay at Manager's sole cost, before same become delinquent, all sales, use and property taxes on Manager's property and business conducted on the Leased Facilities. Manager shall collect and remit to City all sales taxes on the sale of food, beverages and merchandise. (p) Operate and manage the restaurant and lounge and Leased Facilities as public facilities for the use and benefit of the public on a fair, equal and nondiscriminatory basis without preferential treatment to any individual, group or entity. Manager shall comply fully with state and federal anti - discrimination laws, rules and regulations and specifically agrees that no person shall be denied or refused services or other full or equal use of the restaurant and lounge or the Leased Facilities, nor denied employment opportunities by Manager as a result of race, creed, color, sex, age, national origin, ancestry or disability unrelated to ability or job performance. (q) Obtain at Manager's cost and expense all licenses required for the operation of the restaurant and lounge and the activities conducted on the Leased Facilities including a restaurant license and hotel and restaurant liquor license. All such licenses shall remain with the Leased Facilities and upon termination of this Agreement Manager shall transfer or approve the transfer of such licenses to City or its designee. For such purposes, Manager hereby irrevocably appoints Director its agent and attorney in fact to execute all approvals and instruments required for such transfers. Manager shall not sell or give or permit the sale or giving of alcoholic beverages including beer, wine and liquor to any person on the Golf Course except within the Leased Facilities or such other location or place as the Director shall in writing approve. (r) Coordinate the operation and management of the restaurant and lounge and use of the Leased Premises, in a cooperative manner with the manager of the Golf Course including, but not limited to, allowing such manager reasonable access to the pro shop. Any dispute between the Manager and the manger of the Golf Course shall be resolved by the Director. (s) Comply with the rules and regulations adopted by the Director relating to the use of the Golf Course parking lot. (t) Meet and comply with the nondiscrimination and equal employment requirements of section 1 -8 -4 of the Pueblo Municipal Code which are incorporated herein by reference. (u) Furnish, maintain, and keep in force during the effective term of this Agreement a good and sufficient Performance Bond on form provided by City in an amount not less than the Minimum Annual Guarantee as security for the faithful performance of this Agreement and -4- for the payment of all persons performing labor and furnishing equipment and provisions in connection with the restaurant and lounge and the return of the Leased Facilities, and City -owned fixtures and equipment in good condition upon termination of this Agreement. (v) Make capital improvements to the Leased Facilities in the amount and for the purposes specified in the attached Offeror's Explanation of Capital Improvements To Restaurant/ Lounge on or before April 1, 2001. 4. City, subject to availability of sufficient budgeted and appropriated funds therefor, shall repair and maintain the parking lot, and the clubhouse (except the interior of the Leased Facilities and pro shop) including roofs, walls and foundations, and, except for minor and routine repairs, repair and maintain the heating, plumbing and electrical systems in the Leased Facilities. For purposes of such repairs and maintenance, City shall have access to and use of the Leased Premises. 5. For the use of the Leased Facilities, Manager shall pay to City monthly rent equal to the greater of (i) one - twelfth (1/12) of $27,000.00 (the Minimum Annual Guarantee), or (ii) ten (10) percent (10 %) of monthly gross sales up to $30,000.00 plus three (3) percent (3 1 i0) of monthly gross sales in excess of $30,00.00 for each calendar month, with the first and last calendar month being prorated. Monthly rent shall be paid to the City's Department of Finance without notice, set off or deduction, on or before the tenth (10th) day of each calendar month starting with the month of January 2001. Manager shall furnish City's Department of Finance with monthly statements showing gross sales during the prior calendar month on or before the fifteenth (15th) day of each following month. Manager shall keep accurate books and records of all its business conducted in, at, on and from the Leased Facilities and City shall have the right to examine, inspect or audit such books and records upon notice to Manager. If Manager shall fail to timely file any monthly statement, or if Manager shall refuse to produce or to allow City to inspect its books and records after request, City may upon three (3) days prior written notice to Manager specifying the date of termination, terminate this Agreement without releasing or discharging Manager from any and all liabilities incurred or existing on the date of termination. 6. Manager shall fully indemnify and hold harmless, protect and defend at its sole cost and expense, the City, its officers, agents and employees from and against any and all risks, suits, damages, expenses, penalties or claims (including costs and reasonable attorney fees) which City, its officers, agents or employees may incur or become liable as a result of the injury or death of any person or persons, or the loss or damage of any property, or the violation of any law or regulation arising out of or in connection with the operation of the restaurant and lounge or use of the Leased Facilities or the performance or nonperformance of this Agreement by Manager or the negligent acts or omissions of Manager or any of its officers, agents or employees or any other person acting on behalf of Manager. 7. Time is of the essence hereof and to each and every provision of this Agreement. If in the judgment of City Manager of City the manner of maintenance or operation of the restaurant and lounge or the use of the Leased Facilities or the quality or quantity of service, merchandise or food does not meet the requirements of this Agreement, or if Manager breaches or is in default of any -5- term or condition of this Agreement, City may give Manager written notice specifying with reasonable particularity the unsatisfactory performance or default. If Manager fails or refuses to remedy such unsatisfactory performance or default within thirty (30) days after receipt of such notice, City may terminate this Agreement. If City institutes any litigation to enforce its rights or remedies under this Agreement, Manager agrees to pay all costs of enforcement including reasonable attorney fees. 8. Manager shall not use or allow the restaurant and lounge or the Leased Facilities to be used for any improper, unlawful, immoral or objectionable purpose and shall not cause, maintain or permit any disorderly conduct, nuisance or waste in, on or about the Leased Facilities. Manager shall not conduct any activity or sell anything at or on the Leased Facilities except as specifically authorized in this Agreement. 9. Manager shall not make any improvements of a permanent nature to the Leased Facilities or install any sign on the Golf Course or Leased Facilities or make any additions, changes, remodeling or alterations to the Leased Facilities without the Director's prior written approval and obtaining all permits required therefor. All such approved improvements, signs, additions, changes, remodeling or alternations shall remain the property of the City. 10. It is understood and acknowledged by the parties that the relationship of Manager to City is that of an independent contractor and that Manager shall have no authority to employ any person as employee or agent for or on behalf of City for any purpose. Manager shall have no authority, expressed or implied, to bind the City to any agreement, liability or understanding. Manager shall pay when due all required withholding and other employment taxes and income tax on any monies paid pursuant to this Agreement. 11. If the consent or approval of the Director, City Manager or City is required under this Agreement for any purpose, such consent or approval will not be unreasonably withheld. Any approval or consent required by the City shall be by Resolution adopted by the City Council of City. 12. In the event a dispute arises between Manager and the Director with respect to any provision of this Agreement or the obligations or performance of either the City or Manager hereunder, the Director or Manager may submit such dispute to the City Manager for resolution and determination. If such dispute is submitted to the City Manager for resolution, his decision thereon shall be binding upon all parties. 13. Neither the City nor any of its officers, employees or agents shall be responsible or liable for any injury, damage or loss arising out of this Agreement, or Manager's performance or nonperformance hereof, or occurring on or within the Golf Course or Leased Premises from any cause whatsoever, including, but not limited to, (i) the condition of the Golf Course or Leased Premises, (ii) snow or ice or water or sewer leakage or back -up, (iii) the making or failure to make required repairs hereunder by City, and (iv) the failure or interruption of utility services; and Manager hereby waives, releases and discharges City, its officers, employees and agents therefrom. In 14. If the Leased Premises are damaged or destroyed by fire or other casualty, the City may, in its sole and absolute discretion, either (i) repair or rebuild the Leased Premises, or (ii) terminate this Agreement. 15. This Agreement sets forth all understandings and agreements between City and Manager. No change, modification or amendment shall be valid and binding unless set forth in writing, approved by the City, and signed by City and Manager. No verbal representation, agreement or understanding with any officer, employee or agent of the City, either before or after execution of this Agreement, shall affect, modify or change any of the terms or provisions of this Agreement. 16. This Agreement shall not be assigned in whole or in part, nor shall the Leased Facilities or any part thereof be sublet, nor shall any right or privilege herein granted to Manager be sold, transferred or assigned without the prior written approval of the City. Any such sale, transfer, subletting or assignment, whether voluntary or involuntary, without the prior written approval of City shall be void and constitute grounds for immediate termination of this Agreement at the option of the City. The term "assignment" means and includes the sale or transfer of a majority of the capital stock of Manager to any person, firm, corporation or any other entity. 17. City reserves the right to enter upon the Leased Facilities at any time for any reason. 18. The waiver by City of any breach of any term or provision of this Agreement shall not be deemed to be a waiver of such term or provision for any subsequent breach of the same or any other term or provision. 19. Any notice required under this Agreement shall be in writing and personally delivered or sent by United States certified mail, postage prepaid, to: (a) if to the City: City Manager, City of Pueblo, I City Hall Place, Pueblo, Colorado, 81003; (b) If to the Manager, 409 N. Santa Fe Avenue, Pueblo, Colorado, 81003; or to such other place as City or Manager may from time to time designate in a written notice to the other party. 20. If any provision of this Agreement is declared invalid or unenforceable by a court of competent jurisdiction, the unaffected provisions hereof shall remain in full force and effect. 21. This Agreement shall be governed by the laws of the State of Colorado and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and approved assigns. Venue for any litigation arising out of this Agreement shall be Pueblo County, Colorado. 22. Notwithstanding any provision of this Agreement to the contrary, no term or provision -7- of this Agreement shall be construed or interpreted as a waiver, expressed or implied, of any of the immunities, benefits, rights, protections, or any other provisions of the Colorado Governmental Immunity Act, section 24 -10 -101 et seq. C.R.S., or any other law granting immunity to the City and its officers and employees. Executed the day and year first above written. CITY OF PUEBLO, A MUIyrC)PAL CORPORATION M.C.A. NACHOS, INC. By M,, � ll B: P esident of the City Council Att A Ci lerk GUARANTY Secretary In consideration of the City of Pueblo, a Municipal Corporation approving and executing the foregoing Management Agreement, the undersigned Martin Ayala does hereby personally guarantee the performance of the Management Agreement by M.C.A. Nachos, Inc. In the event of the default of M.C.A. Nachos, Inc. under any provision of the Management Agreement and written notice thereof is given to Martin .Ayala, Martin Ayala will timely cure such default and perform all the covenants and provisions of the Management Agreement to be performance by M.C.A. Nachos, Inc. thereunder. Signed on November 13, 2000. : ;:\C'rrY\I' ARK& RI: C\ WAI .KSTCKV,KiMTA(iRMOISCRS.1NACi RIS\ACRMNTI WPI) -^� INVENTORY - WALKINGSTICK Kitchen: • prep sink & shelves • cold & steam prep table & warming unit Vulcan ;rill & burners • deep fryer (Pitco) • Imperial broiler • Jackson dishwashing machine • 1 SE carba;e disposer • dishwashing station with booster hot water heater • warmer • prep table • triple pot & pan sink & shelving • NS cooler freezer w /out shelves • NS cooler cooler w /out shelves Bar: • Sink • Triple Wash Sink • Ice Sink • Beverage Cooler • band wash sink Dining Room: (no tables, chairs, cr decorations) • Tyler cooler in basement Starter Concession: • counter & sink SECTION IV 2. OFFEROWS EXPLANATION OF CAPITAL IMPROVEMENTS TO RESTAURANT/LOUNGE Repairs and replacement of permanent fixtures (i.e. carpet, walls, etc.): Explain: Minor repair to kitchen fl nnr- Touch -up paint in kitchen and storage ar ea. Improvements to be located in facility (i.e. chairs, tables, utensils, equipment, etc.): Explain: - Purrhace tabies. ;hairs -, €iatwa po .s,U.anG,,_ dishes, glassware, daeeV ations, margarita mac- hin[?, stir -er, ^n = = Qc t4-on oven, coolers, ice machines, salamander, m icrowaves, deep fryer, and cooking /serving ute nsils. Purchase televisions. TOTAL: $ 49,000 $ 50,000 Walkingstick Restaurant & Lounge BID SUMMARY BIDDERS BID NO. 00 -069 Hochis Nachos DATE: 10/23/00 TIME: 2:00 PM COMMODITY: WALKING STICK GOLF COURSE & LOUNGE ITEM QUANTITY 1 Minimum Annual Guarantee UP 27000.00 2 Percent of Gross Sales 5 10 Up to Monthly 30000.00 plus Percent of Gross Sales 3 in Excess of Monthly 30000.00 3 Capital Improvements 1 UP 23000.00 50000.00 AMT 23000.00 50000.00