2005-06 Landmark Golf Management - Beverage LicenseLICENSE AGREEMENT
THIS LICENSE AGREEMENT ("Agreement") is made and entered into this/ -0-A of
2005 ("Effective Date") by and between the CITY OF LA QUINTA, a municipal
corpo ation ("City"), and LANDMARK GOLF MANAGEMENT, LLC, a California limited
liability corporation ("Manager").
RECITALS
A. City and Manager are parties to that certain Golf Course Management Agreement
dated as of April 8, 2004 (the "Management Agreement") pursuant to which the Manager
manages for the City the Golf Course and related facilities commonly known as SilverRock
Resort (collectively, the "Golf Facilities").
B. The liquor license for the Golf Facilities ("Liquor License") will be acquired and
held by Manager.
C. City and Manager now desire that Manager conduct the sale of food and
beverages, including alcoholic beverages (the "Food and Beverage Operation"), at the Golf
Facilities, upon the terms and conditions hereinafter set forth.
D. This Agreement shall neither amend nor modify the Management Agreement
except as it relates to the Food and Beverage Operation. As provided in this Agreement, the
Management Agreement shall control the ownership, control, maintenance, and use of Facilities
relating to the Food and Beverage Operation.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, City and Manager hereby agree as follows:
ARTICLE I
1.1 Definitions. As used in this Agreement, the following terms shall have the
respective meanings indicated below:
Ate. The La Quinta Redevelopment Agency.
Affiliate. Any and all corporations, partnerships, trusts, and other entities directly
or indirectly controlled by, controlling, or subject to direct or indirect common control of an
entity or person.
City. The City of La Quinta, a municipal corporation.
City Manager. The person holding the position of City Manager of the City of La
Quinta.
Furnishings and Equipment. All furniture, furnishings, trade fixtures, apparatus
and equipment, including without limitation cash registers, kitchen equipment, appliances, china,
glassware, silverware, telephone systems (not including pay telephones), and other personal
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property used in or held in storage for use in the operation of the food and beverage services at
the Golf Facilities, other than operating inventory.
Impositions. All taxes and assessments (including without limitation real
property taxes and assessments, possessory interest taxes, and personal property taxes), water,
sewer or other similar rents, rates and charges, levies, license fees, permit fees, inspection fees
and other authorization fees and charges, which at any time may be assessed, levied, confirmed
or imposed on the food and beverages services at the Golf Facilities Expense.
Manager. Landmark Golf Management, LLC or any successor to its interests
under this Agreement as provided in Section 9.3 of this Agreement.
Any capitalized terms used herein and not defined shall have the same meaning ascribed
to them in the Management Agreement.
ARTICLE II
2.1 License. City hereby licenses to Manager on a non-exclusive basis, the portion of
the Golf Facilities which is used for the same and consumption of food and beverages, including
alcoholic beverages, for the term, and upon the conditions set forth herein.
2.2 Term. The term of this Agreement shall commence upon the execution of this
Agreement and shall expire one (1) year later.
2.3 Termination. If the Management Agreement is terminated, then this Agreement
shall automatically terminate effective as of same date of termination of the Management
Agreement.
2.4 License Fees. Upon commencement of and throughout the term, Manager shall
pay City a license fee in the monthly amounts as follows: $500.00 per month for the months of
July, August and September; and $1,500.00 per month for the Months of October, November and
December; and $1,500.00 per month for the months of January, February and March; and
$500.00 per month for the months of April, May and June. Such fees shall be paid to City in
lawful money of the United States, in arrears, on or before the tenth (1 Oth) of each month, at the
address for notices set forth in the Management Agreement. Fees for partial months shall be
prorated.
2.5 Assignment of Liquor License. Upon termination or expiration of this
Agreement, and upon written notice of City, Manager shall immediately assign, irrespective of
any alleged breach of this Agreement or the Management Agreement or dispute by any party, the
Liquor License to any person or entity designated by City and shall execute any and all
documents implementing said assignment as determined appropriate by the City.
2.6 Reimbursements for Costs of Liquor License. City shall reimburse Manager for
all costs associated with the acquisition and renewal of the Liquor License within thirty (30) days
of the submission of a requisition in a form approved by the City Manager.
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ARTICLE III
3.1 Sale of Food and Alcoholic Beverages. Upon commencement of and throughout
the Term, Manager shall be responsible for the sale of food and beverages, including alcoholic
beverages, on the premises. Manager shall pay all labor costs and direct expenses relating to the
sale of food and beverages on the premises, including the costs of purchasing food and beverage
inventory and supplies. Manager shall maintain an appropriate number of food and beverage
service employees and an appropriate level of inventory. Manager will collect for its account all
revenues from the sale of food and beverages on the premises.
3.2 Frustration of Purpose. If Manager is not able to sell alcoholic beverages at the
Premises for any reason whatsoever, including without limitation, damage, destruction,
condemnation of all or any portion of the Premises, Acts of God, force majeure events and acts
of governmental agencies, then at Manager's sole discretion, this Agreement shall terminate and
neither party shall have any further rights or obligations under this Agreement.
3.3 Specific Operating Procedures. Manager shall operate and manage the food and
beverage services at the Golf Facilities in accordance with the following operating procedures:
3.3.1 Hours of Operation. Food and beverage service at the Golf Facilities
shall be operated on a daily basis as provided in the Management Agreement.
3.3.2 Dress Code. Appropriate attire shall be worn as defined in the
Management Agreement.
3.3.3 Food and Beverage Operations. Manager shall continuously operate the
restaurant located in the clubhouse and a snack bar. Other than a beverage cart(s), which is
allowed at all times, temporary food stands shall not be installed on the Golf Facilities except for
special events. Manager shall comply with all requirements of state and local law governing the
sale and distribution of alcoholic beverages. Manager shall require and provide basic alcohol
serving training to all alcohol servers. Manager shall obtain and maintain all permits from the
County of Riverside Department of Health for all food and beverage services at the Golf Facility.
Manager shall comply with all regulations of the County Riverside Department of Health and all
other present and future health laws and regulations as may be established by the federal, state,
county, and city governmental agencies. All food service employees shall possess valid food
handler cards, and a copy of these cards shall be maintained in the administrative office at the
Golf Facilities. Manager shall comply with City's municipal code as it relates to tuberculosis
testing, and other health and disease testing as now or hereafter may be required by applicable
law, for all food and beverage employees. Prices of food and beverage services at the Golf
Facilities shall be comparable to prices charged at other first class golf resorts in the Coachella
Valley.
3.3.4 Safety and Security. The food and beverage services at the Golf
Facilities shall comply with all safety regulations of federal, state, and local governmental
agencies, including without limitation any requirements imposed by California Labor Code
Sections 1720 et seq. and 6300 et seq. and regulations promulgated with respect thereto, and
applicable federal occupational, health, and safety laws and regulations. Manager shall take all
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reasonable actions to protect the safety of all food and beverage service employees and
customers. Manager shall provide appropriate security systems, including video monitoring of
cash operations, security alarm systems, motion detection sensors for after hours control, and
locks for the perimeter gates. The alarm system at the food and beverage service locations shall
be tied into an offsite monitoring station. Manager shall keep for seven (7) days computer back-
up tapes for all accounts payable and accounts receivable information. All records at the food
and beverage services at the Golf Facilities shall be kept in fireproof files.
3.3.5 Conformity with Base Budget. The license fees have been established
based upon an assumption that the base budget (copy attached hereto as Exhibit A) will remain
in force and effect without change during the term of the Agreement. If in the reasonable
opinion and discretion of the City Manager there are changes to the budgeted income or
expenses related to the food and beverage services, the City shall adjust the license fee payable
hereunder so that the Manager does not experience a profit or loss in the management of the
Food and Beverage operations. If, by the date that is thirty (30) days after receiving written
notification of the City's adjustment of the license fee, Manager has not consented to the
adjusted license fee amount; this Agreement shall terminate effective on such date or such later
date as the parties agree to.
3.4 Alterations to Buildings. Manager shall not make any alterations, additions, or
changes to the appearance or the structural nature of the clubhouse without the prior approval of
the City Council.
3.5 Operating and Maintenance Standards. The parties acknowledge and agree that
the food and beverage services at the Golf Facilities shall be operated and maintained to the
standards of a first class golf resort. In addition to all other responsibilities of Manager under
this Agreement, Manager agrees that at all times during the term of this Agreement, the food and
beverage services at the Golf Facilities shall be operated and maintained in accordance with the
applicable standards set forth on the "Evaluation Form" attached hereto as Exhibit B and
incorporated herein by this reference. Each month during the term of this Agreement, the City
Manager, or his or her designee, shall inspect the food and beverage services at the Golf
Facilities for purposes of compliance with the terms of this Section 3.5. The remedial
procedures and remedies set forth in Sections 3.8.1 — 3.8.3 of the Management Agreement shall
be applicable provided the maximum deductions from the Performance Evaluation Deposit shall
be $19000.00, per month for each Deficiency Item, under this agreement.
In the event Manager disagrees with the results of any Evaluation Form or in the event
the parties disagree as to whether any Corrective Action Item has been properly or timely
corrected, improved, or repaired, then the parties shall submit the matter in disagreement to the
City Manager. If after submitting the matter in disagreement to the City Manager, the parties are
still unable to resolve the disagreement to their mutual satisfaction, then the matter in
disagreement shall be submitted to the City Council of the City of La Quinta. Manager shall
provide the City Clerk of the City a written description of the matter in disagreement and
Manager's position on such matter, and the results of the City Manager's consideration of such
matter. The matter in disagreement shall be heard at a regularly scheduled open session meeting
of the City Council and the recommendations of the City Council shall be stated in writing and
provided to Manager. The parties agree that Manager shall comply with the recommendations
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made by the City Council as to the correction, improvement, or repair of any Corrective Action
Item in accordance with Manager's responsibilities under this Agreement. With regard to any
matter in disagreement, during the period of time that such matter has been submitted to the City
Council as provided above, the deductions from the Performance Evaluation Deposit shall be
paid into an escrow account held by the City until such matter has been finally resolved.
ARTICLE IV
4.1 Contract Administration. City has designed the City Manager as the individual
who is responsible for administering this Agreement on behalf of City. The City Manager may
designate any member or members of his or her staff or other person to carry out the City
Manager's responsibilities in administering this Agreement. Manager has designated Randy
Duncan, as the individual who is responsible for administering this Agreement on behalf of
Manager. Manager shall notify City in writing if another individual has replaced Randy Duncan,
as the individual who is responsible for administering this Agreement on behalf of Manager.
The parties acknowledge that except as otherwise expressly provided herein (a) the City
Manager has the authority to approve or consent to those matters identified in this Agreement as
requiring City's approval or consent and to make all other decisions on behalf of City regarding
the administration of this Agreement (except where City Council approval is expressly required
herein), and (b) Randy Duncan or such other individual designated by Manager has the authority
to approve or consent to those matters identified in this Agreement as requiring Manager's
approval or consent and to make other decisions on behalf of Manager regarding the
administration of this Agreement. City's management direction to Manager shall be given by the
City Manager.
ARTICLE V
INSURANCE
5.1 Coverage. Manager agrees to insure the food and beverage operations and to
procure and maintain, as a Golf Facilities Expense, at all times during the term of this
Agreement, insurance that complies with the insurance requirements of Section 3.11 of the
Management Agreement:
5.2 Handling of Claims. Manager shall be responsible for handling all claims,
demands, and lawsuits for any losses, damages, liability; and expenses (including without
limitation personal injury and property damage claims) arising out of the operation and
management of the food and beverage services at the Golf Facilities ("Claims"), whether or not
such claims are covered by insurance required under this Article V as provided in Section 3.12 of
the Management Agreement.
ARTICLE VI
6.1 Books and Records. Manager shall keep full and accurate books of account and
such other records as are necessary to reflect the results of the operation of the food and beverage
services at the Golf Facilities. For this purpose, City agrees it will make available to Manager, or
Manager's representatives, all books and records in City's possession relating to the food and
beverage services at the Golf Facilities, including contract documents, invoices and construction
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records. All books and records for the food and beverage services at the Golf Facilities shall be
located at the Golf Facilities. All accounting records shall be maintained in accordance with
generally accepted accounting principles and shall be maintained in an accrual format for each
Operating Year. All such books, records, and reports shall be maintained separately from other
facilities operated by Manager. Manager agrees to maintain reasonable and necessary
accounting, operating, and administrative controls relating to the financial aspects of the food
and beverage services at the Golf Facilities, and such controls shall provide checks and balances
designed to protect the food and beverage services at the Golf Facilities, as well as the Manager
and the City. The cash registers used by Manager shall be approved by City. Manager shall
maintain all financial and accounting books and records for a period of at least seven (7) years
after the expiration, or earlier termination of this Agreement, and City shall have the right to
inspect and audit such books and records during such period as provided in Section 6.2 below.
6.2 Inspection. Upon seven (7) days prior written notice to Manager, which notice
shall set forth the date and time that City desires to inspect the books and records, City or its
authorized agents, auditors, or representatives shall have the right during normal business hours
to review, inspect, audit, and copy the books, records, invoices, deposit receipts, canceled
checks, and other accounting and financial information maintained by Manager in connection
with the operation of the food and beverage services at the Golf Facilities. All such books and
records shall be made available to City at the Golf Facilities, unless City and Manager agree
upon another location City, at its own expense, shall have the right to retain an independent
accounting firm to audit the books and records of the Golf Facilities on an annual basis. City's
rights under this Section shall continue for seven (7) years (6.1) after termination of this
agreement.
6.2.1 Reports to City. Manager shall deliver to City the following financial
statements, in a form acceptable to City:
(a) Within twenty (20) days after the end of each calendar month, a
profit and loss statement showing the results of operation of the food and beverage services at the
Golf Facilities for such month and for the Operating Year to date, which statement shall include
sufficient detail to reflect all gross revenues, and food and beverage service expenses; and
(b) Within sixty (60) days after the end of each Operating Year, a
profit and loss statement showing the results of operation of the food and beverage services at the
Golf Facilities for such Operating Year which statement shall include sufficient detail to reflect
all gross revenues, and food and beverage service expenses. If requested by City, and at the sole
expense of City, these financial statements shall be certified by an independent certified public
accountant acceptable to City.
ARTICLE VII
TERMINATION RIGHTS
7.1 Termination by City. In addition to the City's option to terminate this Agreement
pursuant to Section 2.2, City shall have the right to terminate this Agreement upon the
occurrence of any one of the following events:
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(a) Manager fails to keep, observe or perform any material covenant,
agreement, term or provision of this Agreement to be kept, observed or performed by Manager,
and such default continues for a period of thirty (30) days after written notice of such default by
City to Manager (the "Cure Period"); or
(b) (i) Manager applies for or consents to the appointment of a
receiver, trustee or liquidator of Manager or of all or a substantial part of its assets; (ii) Manager
files a voluntary petition in bankruptcy or commences a proceeding seeking reorganization,
liquidation, or an arrangement with creditors, (iii) Manager files an answer admitting the
material allegations of a bankruptcy petition, reorganization proceeding, or insolvency
proceeding filed against Manager; (iv) Manager admits in writing its inability to pay its debts as
they come due; (v) Manager makes a general assignment for the benefit of creditors; or (vi) an
order, judgment or decree is entered by a court of competent jurisdiction, on the application of a
creditor, adjudicating Manager a bankrupt or insolvent or approving a petition seeking
reorganization of Manager or appointing a receiver, trustee or liquidator of Manager or of all or a
substantial part, of its assets, and such order, judgment or decree continues unstayed and in effect
for any period of sixty (60) consecutive days.
City's right to terminate this Agreement shall be exercised upon written notice to Manager given
at any time after the applicable Cure Period has expired. City's termination notice shall specify
the effective date of such termination, which date shall not be more than sixty (60) days after the
date of City's termination notice.
(c) Termination of this Agreement.
7.2 Termination by Manager. Manager shall have the right to terminate this
Agreement, if City fails to keep, observe, or perform any other material covenant, agreement,
term or provision of this Agreement to be kept, observed or performed by City, and such default
continues for a period of thirty (30) days after notice of such default by Manager to City.
Manager's right to terminate this Agreement pursuant to this Section 7.2 shall be exercised upon
written notice to City given at any time after the applicable grace period has expired. Manager's
termination notice shall specify the effective date of such termination, which date shall not be
less than sixty (60) days after the date of Manager's termination notice.
7.3 Effect of Termination. The termination of this Agreement under the provisions of
this Article VII shall not affect the rights of the terminating party with respect to any damages it
has suffered as a result of any breach of this Agreement, nor shall it affect the rights of either
party with respect to any liability or claims accrued, or arising out of events occurring, prior to
the date of termination.
7.4 Remedies Cumulative. Neither the right of termination, nor the right to sue for
damages, nor any other remedy available to a party under this Agreement shall be exclusive of
any other remedy given under this Agreement or now or hereafter existing at law or in equity.
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ARTICLE VIII
TITLE MATTERS; ASSIGNMENT
8.1 Ownership of Improvements and Personal Property. All improvements to the
food and beverage services at the Golf Facilities made during the term of this Agreement and all
Furnishings and Equipment shall be considered property owned exclusively by City.
8.2 Levelized Inventory. The cost of the present inventory for food and beverage
service shall be ascertained by an inventory audit on the first day of the license. Upon
termination of the license a closing inventory audit shall be made. Any difference in the
beginning and during inventory shall be compensated by a cash payment from the appropriate
party.
8.3 Assignments. Except for an assignment of this Agreement by City to a
governmental agency related to City, neither party shall assign this Agreement without the prior
written consent of the other party. It is understood and agreed that any consent granted by a
party to any such assignment shall not be deemed a waiver of any consent required under this
Section 8.3 as to any future assignment. Any assignment by either party of this Agreement in
violation of the provisions of this Section 8.3 shall be null and void and shall result in the
termination of this Agreement. In addition to any other remedies available to the parties, the
provisions of this Section 8.3 shall be enforceable by injunctive proceeding or by suit for specific
performance.
8.4 Successors and Assigns. Subject to the foregoing, this Agreement shall inure to
the benefit of and be binding upon the parties and their respective heirs, legal representatives,
successors and assigns.
ARTICLE IX
INDEMNITIES
9.1 Manager's Indemnity. Manager agrees to indemnify and hold harmless City,
Agency, and City Personnel from and against any and all claims, demands, actions, lawsuits,
proceedings, damages, liabilities, judgments, penalties, fines, attorneys' fees, costs, and
expenses:
(a) which result from any act or omission constituting negligence or
willful misconduct by Manager or any officer, director, or employee of Manager in connection
with Manager's performance under this Agreement; or
(b) which result from any action taken by Manager relating to the food
and beverage services at the Golf Facilities (i) that is expressly prohibited by this Agreement, or
(ii) that is not within the scope of Manager's authorities under this Agreement.
Manager's indemnity obligations under this Section 9.1 shall not apply to any acts or omissions
taken (or in the case of omissions, not taken) either at the express written direction of City or
with the express written approval of City.
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9.2 City's Indemnity. City agrees to indemnify and hold harmless Manager and its
owners, officers, directors, and employees from and against any and all claims, demands,
actions, lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, attorneys' fees,
costs, and expenses which results from any act or omission constituting negligence or willful
misconduct by City or any officer, director, employee, or agent of City.
ARTICLE X
10.1 Golf Facilities Names. The Golf Facilities shall be known by such trade name
and/or trademark or logo as may from time to time be determined by City. The parties
acknowledge and understand that the names, logos, and designs used in the operation of the food
and beverage services at the Golf Facilities, together with appurtenant goodwill, are the
exclusive property of City. Manager may identify the food and beverage service at the Golf
Facilities as managed and operated by Manager.
10.2 Notices. All notices, demands, requests, consents, approvals, replies and other
communications ("Notices") required or permitted by this Agreement shall be in writing and
may be delivered by any one of the following methods: (a) by personal delivery; (b) by deposit
with the United States Postal Service, postage prepaid to the addresses stated below or (c) by
deposit with an overnight express delivery service. Notice deposited with the United States
Postal Service in the manner described above shall be deemed effective three (3) business days
after deposit with the Postal Service. Notice by overnight express delivery service shall be
deemed effective upon receipt. Notice by personal delivery shall be deemed effective at the time
of personal delivery.
For purposes of Notices hereunder, the address of City shall be:
City of La Quinta
78-495 Calle Tampico
La Quinta, California 92253
Attention: City Manager
For purposes of Notices hereunder, the address of Manager shall be
Landmark Golf Management
74-947 Highway I I I, Suite 200
Indian Wells, CA 92210
Attn: President
Each party shall have the right to designate a different address within the United States of
America by the giving of notice in conformity with this Section 10.2.
10.3 Independent Contractor. Manager shall at all times be considered an independent
contractor under this Agreement. Nothing contained in this Agreement shall be construed to be
or create a partnership or joint venture between City and its successors and assigns, on the one
part, and Manager and its successors and assigns, on the other part.
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10.4 Modification and Changes. This Agreement may be amended or modified only
by a writing signed by both parties.
10.5 Understandings and Agreements. This Agreement and the Management
Agreement constitutes all of the understandings and agreements of whatever nature or kind
existing between the parties with respect to Manager's management and operation of the food
and beverage services at the Golf Facilities, and this Agreement supersedes all prior
understandings and agreements, whether written or oral, between City and Manager pertaining to
the management and operation of the food and beverage services at the Golf Facilities.
10.6 Headings. The Article, Section and Subsection headings contained in this
Agreement are for convenience and reference only and are not intended to define, limit or
describe the scope or intent of any provision of this Agreement.
10.7 Consents. Each party agrees that it will not unreasonably withhold any consent or
approval requested by the other party pursuant to the terms of the Agreement, and that any such
consent or approval shall not be unreasonably delayed or qualified. Similarly, each party agrees
that any provision of this Agreement which permits such party to make requests of the other
party shall not be construed to permit the making of unreasonable requests.
10.8 Survival of Covenants. Any covenant, term or provision of this Agreement which
in order to be effective must survive the termination of this Agreement shall survive any such
termination.
10.9 Third Parties. None of the obligations under this Agreement of either party shall
run to or be enforceable by any party other than the party to this Agreement or by a party
deriving rights under this Agreement as a result of an assignment permitted pursuant to the terms
of this Agreement.
10.10 Waivers. No failure by Manager or City to insist upon the strict performance of
any covenant, agreement, term or condition of this Agreement or to exercise any right or remedy
consequent upon the breach of this Agreement shall constitute a waiver of any such breach or
any subsequent breach of the same covenant, agreement, term or condition. No covenant,
agreement, term or condition of this Agreement and no breach of this Agreement shall be
waived, altered or modified except by a written instrument. A waiver of any breach of this
Agreement shall only affect this Agreement to the extent of the specific waiver, and all
covenants, agreements, terms and conditions of this Agreement shall continue in full force and
effect.
10.11 Applicable Law. This Agreement shall be construed and interpreted in
accordance with, and shall be governed by, the internal laws of the State of California. The
parties agree that the Superior Court of the State of California, County of Riverside shall have
jurisdiction of any litigation between the parties relating to this Agreement.
10.12 No Presumption Regarding Drafter. City and Manager acknowledge and agree
that the terms and provisions of this Agreement have been negotiated and discussed between
City and Manager, and that this Agreement reflects their mutual agreement regarding the subject
matter of this Agreement. Because of the nature of such negotiations and discussions, it would
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be inappropriate to deem either City or Manager to be the drafter of this Agreement, and
therefore no presumption for or against the drifter shall be applicable in interpreting or enforcing
this Agreement.
10.13 Enforceability of Any Provision. If any term, condition, covenant, or obligation
of this Agreement shall be determined to be unenforceable, invalid, or void, such determination
shall not affect, impair, invalidate, or render unenforceable any other term, condition, covenant,
or obligation of this Agreement.
10.14 United States Currency. All amounts payable pursuant to this Agreement shall be
paid in lawful money of the United States of America.
10.15 Counterparts. This Agreement and any amendment may be executed in
counterparts by fax, and upon all counterparts being so executed each such counterpart shall be
considered as an original of this Agreement or any amendment and all counterparts shall be
considered together as one agreement.
10.16 Attorneys' Fees. In the event of a dispute involving the nonperformance by a
party hereto of its obligations under this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees and all other expenses (including fees and costs related to discovery)
reasonably incurred in connection with such dispute, whether or not litigation is commenced, in
addition to all other relief to which the party is entitled. If the successful party recovers
judgment in any legal action or proceeding, the attorneys' fees and all other expenses of
litigation shall be included in and made a part of any such judgment.
10.17 Easements. Manager shall recognize all easements of record affecting the food
and beverage service at the Golf Facilities.
10.18 Publicity. Any commercial advertisements, press releases, articles, or other media
information using City's name or the name of the Golf Facilities shall be subject to the prior
approval of City which approval shall not be unreasonably withheld.
10.19 Covenants Against Discrimination. Manager agrees that in connection with its
performance under this Agreement, there shall be no discrimination by Manager against any
person on account of race, color, creed, religion, sex, marital status, national origin, or ancestry.
Manager agrees to include a provision similar to this Section 10.19 in all subcontracts entered
into by Manager in connection with work being performed under this Agreement.
10.20 Time of the Essence. Time is of the essence of this Agreement. The parties
understand that the time for performance of each obligation has been the subject of negotiation
by the parties.
10.21 Authority. The parties represent for themselves that (a) such party is duly
organized and validly existing, (b) the person or persons executing this Agreement on behalf of
such party is/are duly authorized to execute and deliver this Agreement on behalf of such party,
(c) by so executing this Agreement, such party is formally bound to the terms and provisions of
this Agreement, and (d) the execution of this Agreement does not violate any provision of any
other agreement to which such party is bound.
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10.22 Possessory Interest. Pursuant to California Revenue and Taxation Code Section
107.6, City hereby informs Manager that this Agreement may create a possessory interest subject
to property taxation, and in such event Manager may be, subject to the payment of property taxes
levied on such interest. The parties agree that in the event possessory interest property taxes are
levied against Manager in connection with this Agreement, such taxes shall be considered Golf
Facilities Expense and shall be paid from the Golf Facilities Expense Accounts pursuant to the
provisions of the Management Agreement.
10.23 Conflict of Interest. The parties hereto hereby covenant that during the term of
this agreement they will not employ any person to administer any portion of this agreement that
has an interest, direct or indirect, which would conflict in any manner or degree with the
performance of services required under this Agreement.
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IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be
executed as of the day and year first written above.
CITY OF LA QUINTA, a municipal
corpor tion
(' �L
Date: , 2005 By:
APPROVE AS TO ORM-
. K 0erine Jenson, E ., City Attorney
Date: Petv52005
Its: Mayor
LANDMARK GOLF MANAGEMENT, LLC,
a California limited liability company
By; O�� g ..
Its: rte,
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IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be
executed as of the day and year first written above.
Date: t , 2005
ATTEST:
MWVW, SW4 i BMW as' —Wr-W � �A-
Date:
APPROVED AS TO FORM:
CITY OF LA QUINTA, a municipal
corpor ion
By:
Its: Mayor
LANDMARK GOLF MANAGEMENT, LLC,
a California limited liability company
2005 By:
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LICENSE AGREEMENT
(Amendment No. 1 — Food and Beverage License Agreement for SilverRock Resort)
THIS LICENSE AGREEMENT ("Agreement") is made and entered into this 28"' day of
November, 2005 ("Effective Date") by and between the CITY OF LA QUINTA, a municipal
corporation ("City"), and LANDMARK GOLF MANAGEMENT, LLC, a California limited
liability corporation ("Manager").
RFrITAI S
A. City and Manager are parties to that certain Golf Course Management Agreement
dated as of April 8, 2004 (the "Management Agreement") pursuant to which the Manager
manages for the City the Golf Course and related facilities commonly known as SilverRock
Resort (collectively, the "Golf Facilities").
B. The liquor license for the Golf Facilities ("Liquor License") will be acquired and held
by Manager.
C. City and Manager now desire that Manager conduct the sale of food and beverages,
including alcoholic beverages (the "Food and Beverage Operation"), at the Golf Facilities,
upon the terms and conditions hereinafter set forth.
D. This Agreement shall neither amend nor modify the Management Agreement except
as it relates to the Food and Beverage Operation. As provided in this Agreement, the
Management Agreement shall control the ownership, control, maintenance, and use of
Facilities relating to the Food and Beverage Operation.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, City and Manager hereby agree as follows:
ARTICLE I
1.1 Definitions. As used in this Agreement, the following terms shall have the
respective meanings indicated below:
Agency. The La Quinta Redevelopment Agency.
Affiliate. Any and all corporations, partnerships, trusts, and other entities directly or
indirectly controlled by, controlling, or subject to direct or indirect common control of an
entity or person.
City. The City of La Quinta, a municipal corporation.
City Manager. The person holding the position of City Manager of the City of La Quinta.
Furnishings and Equipment. All furniture, furnishings, trade fixtures, apparatus and
equipment, including without limitation cash registers, kitchen equipment, appliances,
china, glassware, silverware, telephone systems (not including pay telephones), and other
personal property used in or held in storage for use in the operation of the food and
beverage services at the Golf Facilities, other than operating inventory.
Impositions. All taxes and assessments (including without limitation real property taxes
and assessments, possessory interest taxes, and personal property taxes), water, sewer or
other similar rents, rates and charges, levies, license fees, permit fees, inspection fees and
other authorization fees and charges, which at any time may be assessed, levied,
confirmed or imposed on the food and beverages services at the Golf Facilities Expense.
Manager. Landmark Golf Management, LLC or any successor to its interests under this
Agreement as provided in Section 9.3 of this Agreement.
Any capitalized terms used herein and not defined shall have the same meaning ascribed to
them in the Management Agreement.
ARTICLE II
2.1 License. City hereby licenses to Manager on a non-exclusive basis, the portion of
the Golf Facilities which is used for the same and consumption of food and beverages,
including alcoholic beverages, for the term, and upon the conditions set forth herein.
2.2 Term. The term of this Agreement shall commence upon the execution of this
Agreement and shall expire one (1) year later.
2.3 Termination. If the Management Agreement is terminated, then this Agreement
shall automatically terminate effective as of same date of termination of the Management
Agreement.
2.4 License Fees. Upon commencement of and throughout the term, Manager shall pay
City a license fee in the monthly amounts as follows: $500.00 per month for the months
of July, August and September; and $1,500.00 per month for the Months of October,
November and December; and $1,500.00 per month for the months of January, February
and March; and $500.00 per month for the months of April, May and June. Such fees
shall be paid to City in lawful money of the United States, in arrears, on or before the tenth
(10th) of each month, at the address for notices set forth in the Management Agreement.
Fees for partial months shall be prorated.
2.5 Assignment of Liquor License. Upon termination or expiration of this Agreement,
Manager shall not assign the Liquor License to any person or entity unless said assignment
is offered first to a person or entity specified by the City upon the same terms and
conditions as offered to the Third Party, and Manager shall execute any and all documents
implementing said assignment as determined appropriate by the City Manager, and shall
not assign the Liquor License to any person or entity without the prior written consent of
the City.
2.6 Reimbursements for Costs of Liquor License. City shall reimburse Manager for all
costs associated with the acquisition and renewal of the Liquor License within thirty (30)
days of the submission of a requisition in a form approved by the City Manager.
Page 2
ARTIN F III
3.1 Sale of Food and Alcoholic Beverages. Upon commencement of and throughout the
Term, Manager shall be responsible for the sale of food and beverages, including alcoholic
beverages, on the premises. Manager shall pay all labor costs and direct expenses relating
to the sale of food and beverages on the premises, including the costs of purchasing food
and beverage inventory and supplies. Manager shall maintain an appropriate number of
food and beverage service employees and an appropriate level of inventory. Manager will
collect for its account all revenues from the sale of food and beverages on the premises.
3.2 Frustration of Purpose. If Manager is not able to sell alcoholic beverages at the
Premises for any reason whatsoever, including without limitation, damage, destruction,
condemnation of all or any portion of the Premises, Acts of God, force majeure events and
acts of governmental agencies, then at Manager's sole discretion, this Agreement shall
terminate and neither party shall have any further rights or obligations under this
Agreement.
3.3 Specific Operating Procedures. Manager shall operate and manage the food and
beverage services at the Golf Facilities in accordance with the following operating
procedures:
3.3.1 Hours of Operation. Food and beverage service at the Golf Facilities shall be
operated on a daily basis as provided in the Management Agreement.
3.3.2 Dress Code. Appropriate attire shall be worn as defined in the Management
Agreement.
3.3.3 Food and Beverage Operations. Manager shall continuously operate the restaurant
located in the clubhouse and a snack bar. Other than a beverage cart(s), which is allowed
at all times, temporary food stands shall not be installed on the Golf Facilities except for
special events. Manager shall comply with all requirements of state and local law
governing the sale and distribution of alcoholic beverages. Manager shall require and
provide basic alcohol serving training to all alcohol servers. Manager shall obtain and
maintain all permits from the County of Riverside Department of Health for all food and
beverage services at the Golf Facility. Manager shall comply with all regulations of the
County Riverside Department of Health and all other present and future health laws and
regulations as may be established by the federal, state, county, and city governmental
agencies. All food service employees shall possess valid food handler cards, and a copy of
these cards shall be maintained in the administrative office at the Golf Facilities. Manager
shall comply with City's municipal code as it relates to tuberculosis testing, and other
health and disease testing as now or hereafter may be required by applicable law, for all
food and beverage employees. Prices of food and beverage services at the Golf Facilities
shall be comparable to prices charged at other first class golf resorts in the Coachella
Valley.
3.3.4 Safety and Security. The food and beverage services at the Golf Facilities shall
comply with all safety regulations of federal, state, and local governmental agencies,
including without limitation any requirements imposed by California Labor Code Sections
1720 et seq. and 6300 et seq. and regulations promulgated with respect thereto, and
applicable federal occupational, health, and safety laws and regulations. Manager shall
Page 3
take all reasonable actions to protect the safety of all food and beverage service employees
and customers. Manager shall provide appropriate security systems, including video
monitoring of cash operations, security alarm systems, motion detection sensors for after
hours control, and locks for the perimeter gates. The alarm system at the food and
beverage service locations shall be tied into an offsite monitoring station. Manager shall
keep for seven (7) days computer back-up tapes for all accounts payable and accounts
receivable information. All records at the food and beverage services at the Golf Facilities
shall be kept in fireproof files.
3.3.5 Conformity with Base Budget. The license fees have been established based upon
an assumption that the base budget (copy attached hereto as Exhibit A) will remain in
force and effect without change during the term of the Agreement. If in the reasonable
opinion and discretion of the City Manager there are changes to the budget or expenses
related to the food and beverage services, the City shall adjust the license fee payable
hereunder so that the Manager does not experience a profit or loss in the management of
the Food and Beverage operations. If, by the date that is thirty (30) days after receiving
written notification of the City's adjustment of the license fee, Manager has not consented
to the adjusted license fee amount, this Agreement shall terminate effective on such date
or such later date as the parties agree to.
3.4 Alterations to Buildings. Manager shall not make any alterations, additions, or
changes to the appearance or the structural nature of the clubhouse without the prior
approval of the City Council.
3.5 Operating and Maintenance Standards. The parties acknowledge and agree that the
food and beverage services at the Golf Facilities shall be operated and maintained to the
standards of a first class golf resort. In addition to all other responsibilities of Manager
under this Agreement, Manager agrees that at all times during the term of this Agreement,
the food and beverage services at the Golf Facilities shall be operated and maintained in
accordance with the applicable standards set forth on the "Evaluation Form" attached
hereto as Exhibit "B" and incorporated herein by this reference. Each month during the
term of this Agreement, the City Manager, or his or her designee, shall inspect the food
and beverage services at the Golf Facilities for purposes of compliance with the terms of
this Section 3.5. The remedial procedures and remedies set forth in Sections 3.8.1 —
3.8.3 of the Management Agreement shall be applicable provided the maximum deductions
from the Performance Evaluation Deposit shall be $1,000.00 per month for each
Deficiency Item, under this agreement.
In the event Manager disagrees with the results of any Evaluation Form or in the event the
parties disagree as to whether any Corrective Action Item has been properly or timely
corrected, improved, or repaired, then the parties shall submit the matter in disagreement
to the City Manager. If after submitting the matter in disagreement to the City Manager,
the parties are still unable to resolve the disagreement to their mutual satisfaction, then the
matter in disagreement shall be submitted to the City Council of the City of La Quinta.
Manager shall provide the City Clerk of the City a written description of the matter in
disagreement and Manager's position on such matter, and the results of the City
Manager's consideration of such matter. The matter in disagreement shall be heard at a
regularly scheduled open session meeting of the City Council and the recommendations of
the City Council shall be stated in writing and provided to Manager. The parties agree that
Manager shall comply with the recommendations made by the City Council as to the
Page 4
correction, improvement, or repair of any Corrective Action Item in accordance with
Manager's responsibilities under this Agreement. With regard to any matter in
disagreement, during the period of time that such matter has been submitted to the City
Council as provided above, the deductions from the Performance Evaluation Deposit shall
be paid into an escrow account held by the City until such matter has been finally
resolved.
ARTI(_I F IV
4.1 Contract Administration. City has designed the City Manager as the individual who
is responsible for administering this Agreement on behalf of City. The City Manager may
designate any member or members of his or her staff or other person to carry out the City
Manager's responsibilities in administering this Agreement. Manager has designated Randy
Duncan, as the individual who is responsible for administering this Agreement on behalf of
Manager. Manager shall notify City in writing if another individual has replaced Randy
Duncan, as the individual who is responsible for administering this Agreement on behalf of
Manager. The parties acknowledge that except as otherwise expressly provided herein (a)
the City Manager has the authority to approve or consent to those matters identified in this
Agreement as requiring City's approval or consent and to make all other decisions on
behalf of City regarding the administration of this Agreement (except where City Council
approval is expressly required herein), and (b) Randy Duncan or such other individual
designated by Manager has the authority to approve or consent to those matters identified
in this Agreement as requiring Manager's approval or consent and to make other decisions
on behalf of Manager regarding the administration of this Agreement. City's management
direction to Manager shall be given by the City Manager.
ARTICLE V
IAICI IRAN( F:
5.1 Coverage. Manager agrees to insure the food and beverage operations and to
procure and maintain, as a Golf Facilities Expense, at all times during the term of this
Agreement, insurance that complies with the insurance requirements of Section 3.11 of
the Management Agreement:
5.2 Handling of Claims. Manager shall be responsible for handling all claims, demands,
and lawsuits for any losses, damages, liability; and expenses (including without limitation
personal injury and property damage claims) arising out of the operation and management
of the food and beverage services at the Golf Facilities ("Claims"), whether or not such
claims are covered by insurance required under this Article V as provided in Section 3.12
of the Management Agreement.
ARTICLE VI
6.1 Books and Records. Manager shall keep full and accurate books of account and
such other records as are necessary to reflect the results of the operation of the food and
beverage services at the Golf Facilities. For this purpose, City agrees it will make available
to Manager, or Manager's representatives, all books and records in City's possession
relating to the food and beverage services at the Golf Facilities, including contract
documents, invoices and construction records. All books and records for the food and
beverage services at the Golf Facilities shall be located at the Golf Facilities. All
Page 5
accounting records shall be maintained in accordance with generally accepted accounting
principles and shall be maintained in an accrual format for each Operating Year. All such
books, records, and reports shall be maintained separately from other facilities operated by
Manager. Manager agrees to maintain reasonable and necessary accounting, operating,
and administrative controls relating to the financial aspects of the food and beverage
services at the Golf Facilities, and such controls shall provide checks and balances
designed to protect the food and beverage services at the Golf Facilities, as well as the
Manager and the City. The cash registers used by Manager shall be approved by City.
Manager shall maintain all financial and accounting books and records for a period of at
least seven (7) years after the expiration, or earlier termination of this Agreement, and City
shall have the right to inspect and audit such books and records during such period as
provided in Section 6.2 below.
6.2 Inspection. Upon seven (7) days prior written notice to Manager, which notice shall
set forth the date and time that City desires to inspect the books and records, City or its
authorized agents, auditors, or representatives shall have the right during normal business
hours to review, inspect, audit, and copy the books, records, invoices, deposit receipts,
canceled checks, and other accounting and financial information maintained by Manager in
connection with the operation of the food and beverage services at the Golf Facilities. All
such books and records shall be made available to City at the Golf Facilities, unless City
and Manager agree upon another location City, at its own expense, shall have the right to
retain an independent accounting firm to audit the books and records of the Golf Facilities
on an annual basis. City's rights under this Section shall continue for seven (7) years (6.1)
after termination of this agreement.
6.2.1 Reports to City. Manager shall deliver to City the following financial statements, in
a form acceptable to City:
(a) Within twenty (20) days after the end of each calendar month, a profit and loss
statement showing the results of operation of the food and beverage services at the Golf
Facilities for such month and for the Operating Year to date, which statement shall include
sufficient detail to reflect all gross revenues and food and beverage service expenses; and
(b) Within sixty (60) days after the end of each Operating Year, a profit and loss
statement showing the results of operation of the food and beverage services at the Golf
Facilities for such Operating Year which statement shall include sufficient detail to reflect
all gross revenues, and food and beverage service expenses. If requested by City, and at
the sole expense of City, these financial statements shall be certified by an independent
certified public accountant acceptable to City.
ARTICLE VII
TERMINATION RIGHTS
7.1 Termination by City. In addition to the City's option to terminate this Agreement
pursuant to Section 2.2, City shall have the right to terminate this Agreement upon the
occurrence of any one of the following events:
Page 6
Manager fails to keep, observe or perform any material covenant, agreement, term or
provision of this Agreement to be kept, observed or performed by Manager, and such
default continues for a period of thirty (30) days after written notice of such default by
City to Manager (the "Cure Period"); or
(a) (i) Manager applies for or consents to the appointment of a receiver, trustee or
liquidator of Manager or of all or a substantial part of its assets; (ii) Manager files a
voluntary petition in bankruptcy or commences a proceeding seeking reorganization,
liquidation, or an arrangement with creditors, (iii) Manager files an answer admitting the
material allegations of a bankruptcy petition, reorganization proceeding, or insolvency
proceeding filed against Manager; (iv) Manager admits in writing its inability to pay its
debts as they come due; M Manager makes a general assignment for the benefit of
creditors; or (vi) an order, judgment or decree is entered by a court of competent
jurisdiction, on the application of a creditor, adjudicating Manager a bankrupt or insolvent
or approving a petition seeking reorganization of Manager or appointing a receiver, trustee
or liquidator of Manager or of all or a substantial part, of its assets, and such order,
judgment or decree continues unstayed and in effect for any period of sixty (60)
consecutive days.
City's right to terminate this Agreement shall be exercised upon written notice to Manager
given at any time after the applicable Cure Period has expired. City's termination notice
shall specify the effective date of such termination, which date shall not be more than
sixty (60) days after the date of City's termination notice.
(b) Termination of this Agreement.
7.2 Termination by Manager. Manager shall have the right to terminate this Agreement,
if City fails to keep, observe, or perform any other material covenant, agreement, term or
provision of this Agreement to be kept, observed or performed by City, and such default
continues for a period of thirty (30) days after notice of such default by Manager to City.
Manager's right to terminate this Agreement pursuant to this Section 7.2 shall be
exercised upon written notice to City given at any time after the applicable grace period
has expired. Manager's termination notice shall specify the effective date of such
termination, which date shall not be less than sixty (60) days after the date of Manager's
termination notice.
7.3 Effect of Termination. The termination of this Agreement under the provisions of
this Article VII shall not affect the rights of the terminating party with respect to any
damages it has suffered as a result of any breach of this Agreement, nor shall it affect the
rights of either party with respect to any liability or claims accrued, or arising out of events
occurring, prior to the date of termination.
7.4 Remedies Cumulative. Neither the right of termination, nor the right to sue for
damages, nor any other remedy available to a party under this Agreement shall be
exclusive of any other remedy given under this Agreement or now or hereafter existing at
law or in equity.
Page 7
ARTICLE VIII
TITLE MATTERS; ASSIGNMENT
8.1 Ownership of Improvements and Personal Property. All improvements to the food
and beverage services at the Golf Facilities made during the term of this Agreement and all
Furnishings and Equipment shall be considered property owned exclusively by City.
8.2 Levelized Inventory. The cost of the present inventory for food and beverage
service shall be ascertained by an inventory audit on the first day of the license. Upon
termination of the license a closing inventory audit shall be made. Any difference in the
beginning and during inventory shall be compensated by a cash payment from the
appropriate party.
8.3 Assignments. Except for an assignment of this Agreement by by City to a
governmental agency related to City, neither party shall assign this Agreement without the
prior written consent of the other party. It is understood and agreed that any consent
granted by a party to any such assignment shall not be deemed a waiver of any consent
required under this Section 8.3 as to any future assignment. Any assignment by either
party of this Agreement in violation of the provisions of this Section 8.3 shall be null and
void and shall result in the termination of this Agreement. In addition to any other
remedies available to the parties, the provisions of this Section 8.3 shall be enforceable by
injunctive proceeding or by suit for specific performance.
8.4 Successors and Assigns. Subject to the foregoing, this Agreement shall inure to the
benefit of and be binding upon the parties and their respective heirs, legal representatives,
successors and assigns.
ARTICLE IX
INr1FMNITIFS
9.1 Manager's Indemnity. Manager agrees to indemnify and hold harmless City,
Agency, and City Personnel from and against any and all claims, demands, actions,
lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, attorneys' fees,
costs, and expenses:
(a) which result from any act or omission constituting negligence or willful misconduct
by Manager or any officer, director, or employee of Manager in connection with Manager's
performance under this Agreement; or
(b) which result from any action taken by Manager relating to the food and beverage
services at the Golf Facilities (i) that is expressly prohibited by this Agreement, or (ii) that
is not within the scope of Manager's authorities under this Agreement.
Manager's indemnity obligations under this Section 9.1 shall not apply to any acts or
omissions taken (or in the case of omissions, not taken) either at the express written
direction of City or with the express written approval of City.
Page 8
9.2 City's Indemnity. City agrees to indemnify and hold harmless Manager and its
owners, officers, directors, and employees from and against any and all claims, demands,
actions, lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, attorneys'
fees, costs, and expenses which results from any act or omission constituting negligence
or willful misconduct by City or any officer, director, employee, or agent of City.
ARTICLE X
10.1 Golf Facilities Names. The Golf Facilities shall be known by such trade name and/or
trademark or logo as may from time to time be determined by City. The parties
acknowledge and understand that the names, logos, and designs used in the operation of
the food and beverage services at the Golf Facilities, together with appurtenant goodwill,
are the exclusive property of City. Manager may identify the food and beverage service at
the Golf Facilities as managed and operated by Manager.
10.2 Notices. All notices, demands, requests, consents, approvals, replies and other
communications ("Notices") required or permitted by this Agreement shall be in writing and
may be delivered by any one of the following methods: (a) by personal delivery; (b) by
deposit with the United States Postal Service, postage prepaid to the addresses stated
below or (c) by deposit with an overnight express delivery service. Notice deposited with
the United States Postal Service in the manner described above shall be deemed effective
three (3) business days after deposit with the Postal Service. Notice by overnight express
delivery service shall be deemed effective upon receipt. Notice by personal delivery shall
be deemed effective at the time of personal delivery.
For purposes of Notices hereunder, the address of City shall be:
City of La Quinta
78-495 Calle Tampico
La Quinta, California 92253
Attention: City Manager
For purposes of Notices hereunder, the address of Manager shall be
Landmark Golf Management
74-947 Highway 1 1 1, Suite 200
Indian Wells, CA 92210
Attn: President
Each party shall have the right to designate a different address within the United States of
America by the giving of notice in conformity with this Section 10.2.
10.3 Independent Contractor. Manager shall at all times be considered an independent
contractor under this Agreement. Nothing contained in this Agreement shall be construed
to be or create a partnership or joint venture between City and its successors and assigns,
on the one part, and Manager and its successors and assigns, on the other part.
10.4 Modification and Changes. This Agreement may be amended or modified only by a
writing signed by both parties.
Page 9
10.5 Understandings and Agreements. This Agreement and the Management Agreement
constitutes all of the understandings and agreements of whatever nature or kind existing
between the parties with respect to Manager's management and operation of the food and
beverage services at the Golf Facilities, and this Agreement supersedes all prior
understandings and agreements, whether written or oral, between City and Manager
pertaining to the management and operation of the food and beverage services at the Golf
Facilities.
10.6 Headings. The Article, Section and Subsection headings contained in this
Agreement are for convenience and reference only and are not intended to define, limit or
describe the scope or intent of any provision of this Agreement.
10.7 Consents. Each party agrees that it will not unreasonably withhold any consent or
approval requested by the other party pursuant to the terms of the Agreement, and that
any such consent or approval shall not be unreasonably delayed or qualified. Similarly,
each party agrees that any provision of this Agreement which permits such party to make
requests of the other party shall not be construed to permit the making of unreasonable
requests.
10.8 Survival of Covenants. Any covenant, term or provision of this Agreement which in
order to be effective must survive the termination of this Agreement shall survive any such
termination.
10.9 Third Parties. None of the obligations under this Agreement of either party shall run
to or be enforceable by any party other than the party to this Agreement or by a party
deriving rights under this Agreement as a result of an assignment permitted pursuant to the
terms of this Agreement.
10.10 Waivers. No failure by Manager or City to insist upon the strict performance of any
covenant, agreement, term or condition of this Agreement or to exercise any right or
remedy consequent upon the breach of this Agreement shall constitute a waiver of any
such breach or any subsequent breach of the same covenant, agreement, term or
condition. No covenant, agreement, term or condition of this Agreement and no breach of
this Agreement shall be waived, altered or modified except by a written instrument. A
waiver of any breach of this Agreement shall only affect this Agreement to the extent of
the specific waiver, and all covenants, agreements, terms and conditions of this
Agreement shall continue in full force and effect.
10.11 Applicable Law. This Agreement shall be construed and interpreted in accordance
with, and shall be governed by, the internal laws of the State of California. The parties
agree that the Superior Court of the State of California, County of Riverside shall have
jurisdiction of any litigation between the parties relating to this Agreement.
10.12 No Presumption Regarding Drafter. City and Manager acknowledge and agree that
the terms and provisions of this Agreement have been negotiated and discussed between
City and Manager, and that this Agreement reflects their mutual agreement regarding the
subject matter of this Agreement. Because of the nature of such negotiations and
discussions, it would be inappropriate to deem either City or Manager to be the drafter of
this Agreement, and therefore no presumption for or against the drifter shall be applicable
Page 10
in interpreting or enforcing this Agreement.
10.13 Enforceability of Any Provision. If any term, condition, covenant, or obligation of
this Agreement shall be determined to be unenforceable, invalid, or void, such
determination shall not affect, impair, invalidate, or render unenforceable any other term,
condition, covenant, or obligation of this Agreement.
10.14 United States Currency. All amounts payable pursuant to this Agreement shall be
paid in lawful money of the United States of America.
10.15 Counterparts. This Agreement and any amendment may be executed in
counterparts by fax, and upon all counterparts being so executed each such counterpart
shall be considered as an original of this Agreement or any amendment and all counterparts
shall be considered together as one agreement.
10.16 Attorneys' Fees. In the event of a dispute involving the nonperformance by a party
hereto of its obligations under this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees and all other expenses (including fees and costs related to
discovery) reasonably incurred in connection with such dispute, whether or not litigation is
commenced, in addition to all other relief to which the party is entitled. If the successful
party recovers judgment in any legal action or proceeding, the attorneys' fees and all other
expenses of litigation shall be included in and made a part of any such judgment.
10.17 Easements. Manager shall recognize all easements of record affecting the food and
beverage service at the Golf Facilities.
10.18 Publicity. Any commercial advertisements, press releases, articles, or other media
information using City's name or the name of the Golf Facilities shall be subject to the prior
approval of City which approval shall not be unreasonably withheld.
10.19 Covenants Against Discrimination. Manager agrees that in connection with its
performance under this Agreement, there shall be no discrimination by Manager against
any person on account of race, color, creed, religion, sex, marital status, national origin, or
ancestry. Manager agrees to include a provision similar to this Section 10.19 in all
subcontracts entered into by Manager in connection with work being performed under this
Agreement.
10.20 Time of the Essence. Time is of the essence of this Agreement. The parties
understand that the time for performance of each obligation has been the subject of
negotiation by the parties.
10.21 Authority. The parties represent for themselves that (a) such party is duly
organized and validly existing, (b) the person or persons executing this Agreement on
behalf of such party is/are duly authorized to execute and deliver this Agreement on behalf
of such party, (c) by so executing this Agreement, such party is formally bound to the
terms and provisions of this Agreement, and (d) the execution of this Agreement does not
violate any provision of any other agreement to which such party is bound.
10.22 Possessory Interest. Pursuant to California Revenue and Taxation Code Section
107.6, City hereby informs Manager that this Agreement may create a possessory interest
Page 11
subject to property taxation, and in such event Manager may be, subject to the payment of
property taxes levied on such interest. The parties agree that in the event possessory
interest property taxes are levied against Manager in connection with this Agreement, such
taxes shall be considered Golf Facilities Expense and shall be paid from the Golf Facilities
Expense Accounts pursuant to the provisions of the Management Agreement.
10.23 Conflict of Interest. The parties hereto hereby covenant that during the term of this
agreement they will not employ any person to administer any portion of this agreement
that has an interest, direct or indirect, which would conflict in any manner or degree with
the performance of services required under this Agreement.
IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be
executed as of the day and year first written above.
Date: :%(Z$ (00c;
ATTEST:
J n reek, CMC, City Clere
APPROVED AS TO FORM:
'r
I
M. Katherine Jenson, Esq., City Attorney
Date: 4
CITY OF LA QUINTA, a municipal corporation
By: CL1,060
Don Adolph, MVyor
LANDMARK GOLF MANAGEMENT, LLC, a
California limited liability company
By:�
Its: i i"
Page 12
LICENSE AGREEMENT
(Amendment No. I — Food and Beverage License Agreement for SilverRock Resort)
THIS LICENSE AGREEMENT ("Agreement") is made and entered into this 281" day of
November, 2005 ("Effective Date") by and between the CITY OF LA QUINTA, a municipal
corporation ("City"), and LANDMARK GOLF MANAGEMENT, LLC, a California limited
liability corporation ("Manager").
Pl=rITAI R
A. City and Manager are parties to that certain Golf Course Management Agreement
dated as of April 8, 2004 (the "Management Agreement") pursuant to which the Manager
manages for the City the Golf Course and related facilities commonly known as SilverRock
Resort (collectively, the "Golf Facilities").
B. The liquor license for the Golf Facilities ("Liquor License") will be acquired and held
by Manager.
C. City and Manager now desire that Manager conduct the sale of food and beverages,
including alcoholic beverages (the "Food and Beverage Operation"), at the Golf Facilities,
upon the terms and conditions hereinafter set forth.
D. This Agreement shall neither amend nor modify the Management Agreement except
as it relates to the Food and Beverage Operation. As provided in this Agreement, the
Management Agreement shall control the ownership, control, maintenance, and use of
Facilities relating to the Food and Beverage Operation.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, City and Manager hereby agree as follows:
ARTICLE I
1.1 Definitions. As used in this Agreement, the following terms shall have the
respective meanings indicated below:
Agency. The La Quinta Redevelopment Agency.
Affiliate. Any and all corporations, partnerships, trusts, and other entities directly or
indirectly controlled by, controlling, or subject to direct or indirect common control of an
entity or person.
City. The City of La Quinta, a municipal corporation.
City Manager. The person holding the position of City Manager of the City of La Quinta.
Furnishings and Equipment. All furniture, furnishings, trade fixtures, apparatus and
equipment, including without limitation cash registers, kitchen equipment, appliances,
china, glassware, silverware, telephone systems (not including pay telephones), and other
personal property used in or held in storage for use in the operation of the food and
beverage services at the Golf Facilities, other than operating inventory.
Impositions. All taxes and assessments (including without limitation real property taxes
and assessments, possessory interest taxes, and personal property taxes), water, sewer or
other similar rents, rates and charges, levies, license fees, permit fees, inspection fees and
other authorization fees and charges, which at any time may be assessed, levied,
confirmed or imposed on the food and beverages services at the Golf Facilities Expense.
Manager. Landmark Golf Management, LLC or any successor to its interests under this
Agreement as provided in Section 9.3 of this Agreement.
Any capitalized terms used herein and not defined shall have the same meaning ascribed to
them in the Management Agreement.
ARTICLE II
2.1 License. City hereby licenses to Manager on a non-exclusive basis, the portion of
the Golf Facilities which is used for the same and consumption of food and beverages,
including alcoholic beverages, for the term, and upon the conditions set forth herein.
2.2 Term. The term of this Agreement shall commence upon the execution of this
Agreement and shall expire one (1) year later.
2.3 Termination. If the Management Agreement is terminated, then this Agreement
shall automatically terminate effective as of same date of termination of the Management
Agreement.
2.4 License Fees. Upon commencement of and throughout the term, Manager shall pay
City a license fee in the monthly amounts as follows: $500.00 per month for the months
of July, August and September; and $1, 500.00 per month for the Months of October,
November and December; and $1, 500.00 per month for the months of January, February
and March; and $500.00 per month for the months of April, May and June. Such fees
shall be paid to City in lawful money of the United States, in arrears, on or before the tenth
(10`h) of each month, at the address for notices set forth in the Management Agreement.
Fees for partial months shall be prorated.
2.5 Assignment of Liquor License. Upon termination or expiration of this Agreement,
Manager shall not assign the Liquor License to any person or entity unless said assignment
is offered first to a person or entity specified by the City upon the same terms and
conditions as offered to the Third Party, and Manager shall execute any and all documents
implementing said assignment as determined appropriate by the City Manager, and shall
not assign the Liquor License to any person or entity without the prior written consent of
the City.
2.6 Reimbursements for Costs of Liquor License. City shall reimburse Manager for all
costs associated with the acquisition and renewal of the Liquor License within thirty (30)
days of the submission of a requisition in a form approved by the City Manager.
Page 2
ARTICLE III
3.1 Sale of Food and Alcoholic Beverages. Upon commencement of and throughout the
Term, Manager shall be responsible for the sale of food and beverages, including alcoholic
beverages, on the premises. Manager shall pay all labor costs and direct expenses relating
to the sale of food and beverages on the premises, including the costs of purchasing food
and beverage inventory and supplies. Manager shall maintain an appropriate number of
food and beverage service employees and an appropriate level of inventory. Manager will
collect for its account all revenues from the sale of food and beverages on the premises.
3.2 Frustration of Purpose. If Manager is not able to sell alcoholic beverages at the
Premises for any reason whatsoever, including without limitation, damage, destruction,
condemnation of all or any portion of the Premises, Acts of God, force majeure events and
acts of governmental agencies, then at Manager's sole discretion, this Agreement shall
terminate and neither party shall have any further rights or obligations under this
Agreement.
3.3 Specific Operating Procedures. Manager shall operate and manage the food and
beverage services at the Golf Facilities in accordance with the following operating
procedures:
3.3.1 Hours of Operation. Food and beverage service at the Golf Facilities shall be
operated on a daily basis as provided in the Management Agreement.
3.3.2 Dress Code. Appropriate attire shall be worn as defined in the Management
Agreement.
3.3.3 Food and Beverage Operations. Manager shall continuously operate the restaurant
located in the clubhouse and a snack bar. Other than a beverage cart(s), which is allowed
at all times, temporary food stands shall not be installed on the Golf Facilities except for
special events. Manager shall comply with all requirements of state and local law
governing the sale and distribution of alcoholic beverages. Manager shall require and
provide basic alcohol serving training to all alcohol servers. Manager shall obtain and
maintain all permits from the County of Riverside Department of Health for all food and
beverage services at the Golf Facility. Manager shall comply with all regulations of the
County Riverside Department of Health and all other present and future health laws and
regulations as may be established by the federal, state, county, and city governmental
agencies. All food service employees shall possess valid food handler cards, and a copy of
these cards shall be maintained in the administrative office at the Golf Facilities. Manager
shall comply with City's municipal code as it relates to tuberculosis testing, and other
health and disease testing as now or hereafter may be required by applicable law, for all
food and beverage employees. Prices of food and beverage services at the Golf Facilities
shall be comparable to prices charged at other first class golf resorts in the Coachella
Valley.
3.3.4 Safety and Security. The food and beverage services at the Golf Facilities shall
comply with all safety regulations of federal, state, and local governmental agencies,
including without limitation any requirements imposed by California Labor Code Sections
1720 et seq. and 6300 et seq. and regulations promulgated with respect thereto, and
applicable federal occupational, health, and safety laws and regulations. Manager shall
Page 3
take all reasonable actions to protect the safety of all food and beverage service employees
and customers. Manager shall provide appropriate security systems, including video
monitoring of cash operations, security alarm systems, motion detection sensors for after
hours control, and locks for the perimeter gates. The alarm system at the food and
beverage service locations shall be tied into an offsite monitoring station. Manager shall
keep for seven (7) days computer back-up tapes for all accounts payable and accounts
receivable information. All records at the food and beverage services at the Golf Facilities
shall be kept in fireproof files.
3.3.5 Conformity with Base Budget. The license fees have been established based upon
an assumption that the base budget (copy attached hereto as Exhibit A) will remain in
force and effect without change during the term of the Agreement. If in the reasonable
opinion and discretion of the City Manager there are changes to the budget or expenses
related to the food and beverage services, the City shall adjust the license fee payable
hereunder so that the Manager does not experience a profit or loss in the management of
the Food and Beverage operations. If, by the date that is thirty (30) days after receiving
written notification of the City's adjustment of the license fee, Manager has not consented
to the adjusted license fee amount, this Agreement shall terminate effective on such date
or such later date as the parties agree to.
3.4 Alterations to Buildings. Manager shall not make any alterations, additions, or
changes to the appearance or the structural nature of the clubhouse without the prior
approval of the City Council.
3.5 Operating and Maintenance Standards. The parties acknowledge and agree that the
food and beverage services at the Golf Facilities shall be operated and maintained to the
standards of a first class golf resort. In addition to all other responsibilities of Manager
under this Agreement, Manager agrees that at all times during the term of this Agreement,
the food and beverage services at the Golf Facilities shall be operated and maintained in
accordance with the applicable standards set forth on the "Evaluation Form" attached
hereto as Exhibit "B" and incorporated herein by this reference. Each month during the
term of this Agreement, the City Manager, or his or her designee, shall inspect the food
and beverage services at the Golf Facilities for purposes of compliance with the terms of
this Section 3.5. The remedial procedures and remedies set forth in Sections 3.8.1 —
3.8.3 of the Management Agreement shall be applicable provided the maximum deductions
from the Performance Evaluation Deposit shall be $1,000.00 per month for each
Deficiency Item, under this agreement.
In the event Manager disagrees with the results of any Evaluation Form or in the event the
parties disagree as to whether any Corrective Action Item has been properly or timely
corrected, improved, or repaired, then the parties shall submit the matter in disagreement
to the City Manager. If after submitting the matter in disagreement to the City Manager,
the parties are still unable to resolve the disagreement to their mutual satisfaction, then the
matter in disagreement shall be submitted to the City Council of the City of La Quinta.
Manager shall provide the City Clerk of the City a written description of the matter in
disagreement and Manager's position on such matter, and the results of the City
Manager's consideration of such matter. The matter in disagreement shall be heard at a
regularly scheduled open session meeting of the City Council and the recommendations of
the City Council shall be stated in writing and provided to Manager. The parties agree that
Manager shall comply with the recommendations made by the City Council as to the
Page 4
correction, improvement, or repair of any Corrective Action Item in accordance with
Manager's responsibilities under this Agreement. With regard to any matter in
disagreement, during the period of time that such matter has been submitted to the City
Council as provided above, the deductions from the Performance Evaluation Deposit shall
be paid into an escrow account held by the City until such matter has been finally
resolved.
ARTI(_I F IV
4.1 Contract Administration. City has designed the City Manager as the individual who
is responsible for administering this Agreement on behalf of City. The City Manager may
designate any member or members of his or her staff or other person to carry out the City
Manager's responsibilities in administering this Agreement. Manager has designated Randy
Duncan, as the individual who is responsible for administering this Agreement on behalf of
Manager. Manager shall notify City in writing if another individual has replaced Randy
Duncan, as the individual who is responsible for administering this Agreement on behalf of
Manager. The parties acknowledge that except as otherwise expressly provided herein (a)
the City Manager has the authority to approve or consent to those matters identified in this
Agreement as requiring City's approval or consent and to make all other decisions on
behalf of City regarding the administration of this Agreement (except where City Council
approval is expressly required herein), and (b) Randy Duncan or such other individual
designated by Manager has the authority to approve or consent to those matters identified
in this Agreement as requiring Manager's approval or consent and to make other decisions
on behalf of Manager regarding the administration of this Agreement. City's management
direction to Manager shall be given by the City Manager.
ARTICLE V
INSIIRANC:F
5.1 Coverage. Manager agrees to insure the food and beverage operations and to
procure and maintain, as a Golf Facilities Expense, at all times during the term of this
Agreement, insurance that complies with the insurance requirements of Section 3.11 of
the Management Agreement:
5.2 Handling of Claims. Manager shall be responsible for handling all claims, demands,
and lawsuits for any losses, damages, liability; and expenses (including without limitation
personal injury and property damage claims) arising out of the operation and management
of the food and beverage services at the Golf Facilities ("Claims"), whether or not such
claims are covered by insurance required under this Article V as provided in Section 3.12
of the Management Agreement.
ARTIrI F VI
6.1 Books and Records. Manager shall keep full and accurate books of account and
such other records as are necessary to reflect the results of the operation of the food and
beverage services at the Golf Facilities. For this purpose, City agrees it will make available
to Manager, or Manager's representatives, all books and records in City's possession
relating to the food and beverage services at the Golf Facilities, including contract
documents, invoices and construction records. All books and records for the food and
beverage services at the Golf Facilities shall be located at the Golf Facilities. All
Page 5
accounting records shall be maintained in accordance with generally accepted accounting
principles and shall be maintained in an accrual format for each Operating Year. All such
books, records, and reports shall be maintained separately from other facilities operated by
Manager. Manager agrees to maintain reasonable and necessary accounting, operating,
and administrative controls relating to the financial aspects of the food and beverage
services at the Golf Facilities, and such controls shall provide checks and balances
designed to protect the food and beverage services at the Golf Facilities, as well as the
Manager and the City. The cash registers used by Manager shall be approved by City.
Manager shall maintain all financial and accounting books and records for a period of at
least seven (7) years after the expiration, or earlier termination of this Agreement, and City
shall have the right to inspect and audit such books and records during such period as
provided in Section 6.2 below.
6.2 Inspection. Upon seven (7) days prior written notice to Manager, which notice shall
set forth the date and time that City desires to inspect the books and records, City or its
authorized agents, auditors, or representatives shall have the right during normal business
hours to review, inspect, audit, and copy the books, records, invoices, deposit receipts,
canceled checks, and other accounting and financial information maintained by Manager in
connection with the operation of the food and beverage services at the Golf Facilities. All
such books and records shall be made available to City at the Golf Facilities, unless City
and Manager agree upon another location City, at its own expense, shall have the right to
retain an independent accounting firm to audit the books and records of the Golf Facilities
on an annual basis. City's rights under this Section shall continue for seven (7) years (6.1)
after termination of this agreement.
6.2.1 Reports to City. Manager shall deliver to City the following financial statements, in
a form acceptable to City:
(a) Within twenty (20) days after the end of each calendar month, a profit and loss
statement showing the results of operation of the food and beverage services at the Golf
Facilities for such month and for the Operating Year to date, which statement shall include
sufficient detail to reflect all gross revenues and food and beverage service expenses; and
(b) Within sixty (60) days after the end of each Operating Year, a profit and loss
statement showing the results of operation of the food and beverage services at the Golf
Facilities for such Operating Year which statement shall include sufficient detail to reflect
all gross revenues, and food and beverage service expenses. If requested by City, and at
the sole expense of City, these financial statements shall be certified by an independent
certified public accountant acceptable to City.
ARTICLE VII
TERMINATION RIGHTS
7.1 Termination by City. In addition to the City's option to terminate this Agreement
pursuant to Section 2.2, City shall have the right to terminate this Agreement upon the
occurrence of any one of the following events:
Page 6
Manager fails to keep, observe or perform any material covenant, agreement, term or
provision of this Agreement to be kept, observed or performed by Manager, and such
default continues for a period of thirty (30) days after written notice of such default by
City to Manager (the "Cure Period"); or
(a) (i) Manager applies for or consents to the appointment of a receiver, trustee or
liquidator of Manager or of all or a substantial part of its assets; (ii) Manager files a
voluntary petition in bankruptcy or commences a proceeding seeking reorganization,
liquidation, or an arrangement with creditors, (iii) Manager files an answer admitting the
material allegations of a bankruptcy petition, reorganization proceeding, or insolvency
proceeding filed against Manager; (iv) Manager admits in writing its inability to pay its
debts as they come due; (v) Manager makes a general assignment for the benefit of
creditors; or (vi) an order, judgment or decree is entered by a court of competent
jurisdiction, on the application of a creditor, adjudicating Manager a bankrupt or insolvent
or approving a petition seeking reorganization of Manager or appointing a receiver, trustee
or liquidator of Manager or of all or a substantial part, of its assets, and such order,
judgment or decree continues unstayed and in effect for any period of sixty (60)
consecutive days.
City's right to terminate this Agreement shall be exercised upon written notice to Manager
given at any time after the applicable Cure Period has expired. City's termination notice
shall specify the effective date of such termination, which date shall not be more than
sixty (60) days after the date of City's termination notice.
(b) Termination of this Agreement.
7.2 Termination by Manager. Manager shall have the right to terminate this Agreement,
if City fails to keep, observe, or perform any other material covenant, agreement, term or
provision of this Agreement to be kept, observed or performed by City, and such default
continues for a period of thirty (30) days after notice of such default by Manager to City.
Manager's right to terminate this Agreement pursuant to this Section 7.2 shall be
exercised upon written notice to City given at any time after the applicable grace period
has expired. Manager's termination notice shall specify the effective date of such
termination, which date shall not be less than sixty (60) days after the date of Manager's
termination notice.
7.3 Effect of Termination. The termination of this Agreement under the provisions of
this Article VII shall not affect the rights of the terminating party with respect to any
damages it has suffered as a result of any breach of this Agreement, nor shall it affect the
rights of either party with respect to any liability or claims accrued, or arising out of events
occurring, prior to the date of termination.
7.4 Remedies Cumulative. Neither the right of termination, nor the right to sue for
damages, nor any other remedy available to a party under this Agreement shall be
exclusive of any other remedy given under this Agreement or now or hereafter existing at
law or in equity.
Page 7
ARTICLE VIII
TITLE MATTERS; ASSIGNMENT
8.1 Ownership of Improvements and Personal Property. All improvements to the food
and beverage services at the Golf Facilities made during the term of this Agreement and all
Furnishings and Equipment shall be considered property owned exclusively by City.
8.2 Levelized Inventory. The cost of the present inventory for food and beverage
service shall be ascertained by an inventory audit on the first day of the license. Upon
termination of the license a closing inventory audit shall be made. Any difference in the
beginning and during inventory shall be compensated by a cash payment from the
appropriate party.
8.3 Assignments. Except for an assignment of this Agreement by by City to a
governmental agency related to City, neither party shall assign this Agreement without the
prior written consent of the other party. It is understood and agreed that any consent
granted by a party to any such assignment shall not be deemed a waiver of any consent
required under this Section 8.3 as to any future assignment. Any assignment by either
party of this Agreement in violation of the provisions of this Section 8.3 shall be null and
void and shall result in the termination of this Agreement. In addition to any other
remedies available to the parties, the provisions of this Section 8.3 shall be enforceable by
injunctive proceeding or by suit for specific performance.
8.4 Successors and Assigns. Subject to the foregoing, this Agreement shall inure to the
benefit of and be binding upon the parties and their respective heirs, legal representatives,
successors and assigns.
ARTIM F W
"k a !U51111111W
9.1 Manager's Indemnity. Manager agrees to indemnify and hold harmless City,
Agency, and City Personnel from and against any and all claims, demands, actions,
lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, attorneys' fees,
costs, and expenses:
(a) which result from any act or omission constituting negligence or willful misconduct
by Manager or any officer, director, or employee of Manager in connection with Manager's
performance under this Agreement; or
(b) which result from any action taken by Manager relating to the food and beverage
services at the Golf Facilities (i) that is expressly prohibited by this Agreement, or (ii) that
is not within the scope of Manager's authorities under this Agreement.
Manager's indemnity obligations under this Section 9.1 shall not apply to any acts or
omissions taken (or in the case of omissions, not taken) either at the express written
direction of City or with the express written approval of City.
Page 8
9.2 City's Indemnity. City agrees to indemnify and hold harmless Manager and its
owners, officers, directors, and employees from and against any and all claims, demands,
actions, lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, attorneys'
fees, costs, and expenses which results from any act or omission constituting negligence
or willful misconduct by City or any officer, director, employee, or agent of City.
ARTICLE X
10.1 Golf Facilities Names. The Golf Facilities shall be known by such trade name and/or
trademark or logo as may from time to time be determined by City. The parties
acknowledge and understand that the names, logos, and designs used in the operation of
the food and beverage services at the Golf Facilities, together with appurtenant goodwill,
are the exclusive property of City. Manager may identify the food and beverage service at
the Golf Facilities as managed and operated by Manager.
10.2 Notices. All notices, demands, requests, consents, approvals, replies and other
communications ("Notices") required or permitted by this Agreement shall be in writing and
may be delivered by any one of the following methods: (a) by personal delivery; (b) by
deposit with the United States Postal Service, postage prepaid to the addresses stated
below or (c) by deposit with an overnight express delivery service. Notice deposited with
the United States Postal Service in the manner described above shall be deemed effective
three (3) business days after deposit with the Postal Service. Notice by overnight express
delivery service shall be deemed effective upon receipt. Notice by personal delivery shall
be deemed effective at the time of personal delivery.
For purposes of Notices hereunder, the address of City shall be:
City of La Quinta
78-495 Calle Tampico
La Quinta, California 92253
Attention: City Manager
For purposes of Notices hereunder, the address of Manager shall be
Landmark Golf Management
74-947 Highway 1 1 1 , Suite 200
Indian Wells, CA 92210
Attn: President
Each party shall have the right to designate a different address within the United States of
America by the giving of notice in conformity with this Section 10.2.
10.3 Independent Contractor. Manager shall at all times be considered an independent
contractor under this Agreement. Nothing contained in this Agreement shall be construed
to be or create a partnership or joint venture between City and its successors and assigns,
on the one part, and Manager and its successors and assigns, on the other part.
10.4 Modification and Changes. This Agreement may be amended or modified only by a
writing signed by both parties.
Page 9
10.5 Understandings and Agreements. This Agreement and the Management Agreement
constitutes all of the understandings and agreements of whatever nature or kind existing
between the parties with respect to Manager's management and operation of the food and
beverage services at the Golf Facilities, and this Agreement supersedes all prior
understandings and agreements, whether written or oral, between City and Manager
pertaining to the management and operation of the food and beverage services at the Golf
Facilities.
10.6 Headings. The Article, Section and Subsection headings contained in this
Agreement are for convenience and reference only and are not intended to define, limit or
describe the scope or intent of any provision of this Agreement.
10.7 Consents. Each party agrees that it will not unreasonably withhold any consent or
approval requested by the other party pursuant to the terms of the Agreement, and that
any such consent or approval shall not be unreasonably delayed or qualified. Similarly,
each party agrees that any provision of this Agreement which permits such party to make
requests of the other party shall not be construed to permit the making of unreasonable
requests.
10.8 Survival of Covenants. Any covenant, term or provision of this Agreement which in
order to be effective must survive the termination of this Agreement shall survive any such
termination.
10.9 Third Parties. None of the obligations under this Agreement of either party shall run
to or be enforceable by any party other than the party to this Agreement or by a party
deriving rights under this Agreement as a result of an assignment permitted pursuant to the
terms of this Agreement.
10.10 Waivers. No failure by Manager or City to insist upon the strict performance of any
covenant, agreement, term or condition of this Agreement or to exercise any right or
remedy consequent upon the breach of this Agreement shall constitute a waiver of any
such breach or any subsequent breach of the same covenant, agreement, term or
condition. No covenant, agreement, term or condition of this Agreement and no breach of
this Agreement shall be waived, altered or modified except by a written instrument. A
waiver of any breach of this Agreement shall only affect this Agreement to the extent of
the specific waiver, and all covenants, agreements, terms and conditions of this
Agreement shall continue in full force and effect.
10.11 Applicable Law. This Agreement shall be construed and interpreted in accordance
with, and shall be governed by, the internal laws of the State of California. The parties
agree that the Superior Court of the State of California, County of Riverside shall have
jurisdiction of any litigation between the parties relating to this Agreement.
10.12 No Presumption Regarding Drafter. City and Manager acknowledge and agree that
the terms and provisions of this Agreement have been negotiated and discussed between
City and Manager, and that this Agreement reflects their mutual agreement regarding the
subject matter of this Agreement. Because of the nature of such negotiations and
discussions, it would be inappropriate to deem either City or Manager to be the drafter of
this Agreement, and therefore no presumption for or against the drifter shall be applicable
Page 10
in interpreting or enforcing this Agreement.
10.13 Enforceability of Any Provision. If any term, condition, covenant, or obligation of
this Agreement shall be determined to be unenforceable, invalid, or void, such
determination shall not affect, impair, invalidate, or render unenforceable any other term,
condition, covenant, or obligation of this Agreement.
10.14 United States Currency. All amounts payable pursuant to this Agreement shall be
paid in lawful money of the United States of America.
10.15 Counterparts. This Agreement and any amendment may be executed in
counterparts by fax, and upon all counterparts being so executed each such counterpart
shall be considered as an original of this Agreement or any amendment and all counterparts
shall be considered together as one agreement.
10.16 Attorneys' Fees. In the event of a dispute involving the nonperformance by a party
hereto of its obligations under this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees and all other expenses (including fees and costs related to
discovery) reasonably incurred in connection with such dispute, whether or not litigation is
commenced, in addition to all other relief to which the party is entitled. If the successful
party recovers judgment in any legal action or proceeding, the attorneys' fees and all other
expenses of litigation shall be included in and made a part of any such judgment.
10.17 Easements. Manager shall recognize all easements of record affecting the food and
beverage service at the Golf Facilities.
10,18 Publicity. Any commercial advertisements, press releases, articles, or other media
information using City's name or the name of the Golf Facilities shall be subject to the prior
approval of City which approval shall not be unreasonably withheld.
10.19 Covenants Against Discrimination. Manager agrees that in connection with its
performance under this Agreement, there shall be no discrimination by Manager against
any person on account of race, color, creed, religion, sex, marital status, national origin, or
ancestry. Manager agrees to include a provision similar to this Section 10.19 in all
subcontracts entered into by Manager in connection with work being performed under this
Agreement.
10.20 Time of the Essence. Time is of the essence of this Agreement. The parties
understand that the time for performance of each obligation has been the subject of
negotiation by the parties.
10.21 Authority. The parties represent for themselves that (a) such party is duly
organized and validly existing, (b) the person or persons executing this Agreement on
behalf of such party is/are duly authorized to execute and deliver this Agreement on behalf
of such party, (c) by so executing this Agreement, such party is formally bound to the
terms and provisions of this Agreement, and (d) the execution of this Agreement does not
violate any provision of any other agreement to which such party is bound.
10.22 Possessory Interest. Pursuant to California Revenue and Taxation Code Section
107.6, City hereby informs Manager that this Agreement may create a possessory interest
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subject to property taxation, and in such event Manager may be, subject to the payment of
property taxes levied on such interest. The parties agree that in the event possessory
interest property taxes are levied against Manager in connection with this Agreement, such
taxes shall be considered Golf Facilities Expense and shall be paid from the Golf Facilities
Expense Accounts pursuant to the provisions of the Management Agreement.
10.23 Conflict of Interest. The parties hereto hereby covenant that during the term of this
agreement they will not employ any person to administer any portion of this agreement
that has an interest, direct or indirect, which would conflict in any manner or degree with
the performance of services required under this Agreement.
IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be
executed as of the day and year first written above.
Date: %%its F
ATTEST:
J n ftreek, CIVIC, City Cle
APPROVED AS TO FORM:
J
- c
M. Katherine Jenson, Esq., City Attorney
CITY OF LA QUINTA, a municipal corporation
By: &'u-'
Don Adolph, M or
LANDMARK GOLF MANAGEMENT, LLC, a
California limited liability company
6
Date: _ . , x ; By.
Its:
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