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Exclusive Soft Drink Provider Agreement for Leisure Facilities_Lime Rock SpringsCopyrighted April 6, 2020 City of Dubuque Consent Items # 4. ITEM TITLE: Exclusive Soft Drink Provider Agreement for Leisure Services Facilities SUMMARY: City Manager recommending approval of a three-year Exclusive Soft Drink Provider Agreement with Lime Rock Springs for the Bunker Hill Golf Course, McAleece concession, Flora and Sutton pool concession, Veteran's Memorial Park and the Port of Dubuque Marina. SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Approve ATTACHMENTS: Description Type Exclusive Soft Drive Provider Agreement-MVM Memo City Manager Memo Staff memo Staff Memo Signed Agreement by Lime Rock Springs Inc. Supporting Documentation Masterpiece on the Mississippi Dubuque All-A.aia City 111111 2007.2012.2013 2017*2019 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Exclusive Soft Drink Provider Agreement for Leisure Services Facilities DATE: March 30, 2020 The City received two responses to an RFP for Exclusive Soft Drink rights. Leisure Services Manager Marie Ware recommends City Council approval of a three- year Exclusive Soft Drink Provider Agreement with Lime Rock Springs for the Bunker Hill Golf Course, McAleece concession, Flora and Sutton pool concession, Veteran's Memorial Park and the Port of Dubuque Marina. The agreement was unanimously approved by the Park and Recreation Commission at their March 11, 2020 meeting. The agreement with Pepsi provides the City of Dubuque with the highest potential for revenue generation, a solid annual funding program and the shortest turn around on product orders/delivery. I concur with the recommendation and respectfully request Mayor and City Council approval. Mic ael C. Van Milligen MCVM:jh Attachment cc: Crenna Brumwell, City Attorney Teri Goodmann, Assistant City Manager Cori Burbach, Assistant City Manager Marie L. Ware, Leisure Services Manager Masterpiece on the Mississippi Dubuque hfrid AII•Ameriea City illir 2007*2012*2013 2017*2019 TO: Michael C. Van Milligen, City Manager FROM: Marie L. Ware, Leisure Services Manager SUBJECT: Exclusive Soft Drink Provider Agreement for Leisure Services Facilities DATE: March 30, 2020 INTRODUCTION The purpose of this memorandum is to recommend approval of an Exclusive Soft Drink Provider Agreement to Lime Rock Springs Agreement for the Bunker Hill Golf Course, McAleece concession, Flora and Sutton pool concession, Veterans Memorial Park and the Port of Dubuque Marina. BACKGROUND In 2017 Leisure Services entered a 3-year exclusive soft drink provider agreement with Coca-Cola for Bunker Hill Golf Course, Flora and Sutton pools, Port of Dubuque Marina and McAleece concessions. They have had three other 5-year agreements prior to 2017. Recently staff prepared an RFP for Exclusive Soft Drink rights for the aforementioned sites as well as added Veterans Memorial Park/Miracle League of Dubuque. DISCUSSION Staff received 2 proposals from local venders. One from Atlantic Bottling (Coca-Cola) and the other from Lime Rock Springs (Pepsi). Both companies are well established within the Dubuque community. The attached proposal from Pepsi provides the City of Dubuque with the highest potential for revenue generation, a solid annual funding program and shortest turn around on product orders/delivery. Pepsi's proposal will provide the City with a payment of $5,000 per year to go back into operating revenue. In addition, Pepsi pledges to spend at least $2,000 per year on Department services like golf and pool rentals. Coke's proposal was for $6,600 per year, yet in return they requested up to 24 daily rounds of golf that they would disperse to their clients. The agreement was presented to the Park and Recreation Commission for recommendation at their March 11, 2020 meeting and received unanimous approval. The City Attorney's office has reviewed and approves of the contract agreement. ACTION REQUESTED I respectfully request and recommend City Council approval of a three (3) year Exclusive Soft Drink Provider Agreement to Lime Rock Springs Agreement for the Bunker Hill Golf Course, McAleece concession, Flora and Sutton pool concession, Veterans Memorial Park and the Port of Dubuque Marina. Prepared by: Dan Kroger, Recreation Division Manager cc: Janna Beau, Recreation Supervisor Mike Sullivan, PGA Professional Brian Feldott, Recreation Supervisor Jenny Larson, Budget and Finance Director 2 On -Premise LIME ROCK EST. SPRINGS co. IBIS DUBUQUE V- our IOWA BEVERAGE SALES AGREEMENT This beverage sales agreement (this "Agreement") is made effective this 7th day of April, 2020 (the "Effective Date"), by and between the City of Dubuque, Iowa (the "Customer"), and Lime Rock Springs Co., 10537 Highway 52 N, Dubuque, Iowa 52001. RECITALS 1. Lime Rock Springs Co. is engaged in the business of advertising, marketing and selling Beverage Products, as hereafter defined, and providing and servicing Equipment to facilitate the sales and dispensing of such products. 2. Customer desires to engage Lime Rock Springs Co. as its exclusive supplier of Beverage Products and related services to Customer's Leisure Services Outlets. 3. Lime Rock Springs Co. is willing to provide Customer with Beverage Products and services according to the terms of this Agreement. NOW, THEREFORE, for good and valuable consideration, and in consideration of the mutual covenants and agreements set forth herein, Lime Rock Springs Co. and Customer hereby agree as follows: 1. Term 1.1. The term of this Agreement shall commence on April 1st, 2020 (the "Effective Date") and expire on March 31 st, 2023 (the "Term"). For purposes of this Agreement, the term "Year" shall mean a twelve (12) month period during the Term beginning on the Effective Date or anniversary thereof. 2. Scope 2.1. This Agreement covers all beverage products offered for sale by Customer, including all packaged beverages (the "Packaged Products") and all postmix products (the "Postmix Products") for use in preparing fountain beverage products (the "Fountain Products") by Customer from Lime Rock Springs Co., all to be sold in Customer's current outlet(s) identified in Exhibit A and outlet(s) that may be opened or acquired by Customer under its Banner regardless of ownership and legal name during the Term (the "Outlet(s)")(Banner is defined as any outlet operating under the "Customer" name). For purposes of this Agreement, the term "Beverage Products" shall mean all non-alcoholic beverages offered for sale by Customer, including the packaged products and the postmix products provided by Lime Rock Springs Co. at any time during the Term. Beverage products shall include, but is not limited to carbonated soft drinks, teas, lemonade, juices, juice blends, isotonics and all exercise replenishment beverages, energy drinks, mineral On -Premise water, flavored water, enhanced water, drinking water, sparkling water, and iced coffee, but excludes 100% milk. 2.2. For purposes of this Agreement, the term "Gallons" shall mean gallons of postmix products purchased by Customer from Lime Rock Springs Co. during the Term. 3. Exclusivity 3.1. Customer agrees that Lime Rock Springs Co. shall be the exclusive supplier of the beverage products to Customer at the Outlets during the Term. Accordingly, the beverage products, packaged products and postmix products sold, dispensed or otherwise made available, or in any way advertised, displayed, or promoted at or in connection with the Outlets by any method or through any medium whatsoever (including, without limitation, print, television, radio, internet, coupons, in-store displays and signage) will be exclusively provided by Lime Rock Springs Co.. 4. Products and Services Provided by Lime Rock Springs Co. 4.1. Beverage Products. Lime Rock Springs Co. shall provide all Beverage Products offered for sale, dispensed by machine or person or otherwise made available or distributed by or on behalf of the Customer at the Outlets. 4.2. Equipment. Lime Rock Springs Co. shall, at Lime Rock Springs Co.'s expense, install fountain equipment to be used exclusively to dispense the Fountain Products, and vending machines and other dispensing equipment to be used exclusively in the sale of Packaged Products (collectively, the "Equipment") in Customer Outlet(s). The type and quantity of the Equipment shall be determined from time to time by Lime Rock Springs Co. and the Customer. All Equipment furnished by Lime Rock Springs Co. to Customer shall remain the property of Lime Rock Springs Co. 4.3. Equipment Services. Lime Rock Springs Co. shall maintain the Equipment in good working order. Lime Rock Springs Co. shall provide service as required for maintaining the Equipment as follows: (a) during regular business hours on Monday through Friday; and (b) on an "on -call" basis for non -regular business hours on Monday through Friday as well as Saturday and Sunday. Lime Rock Springs Co. will retain the exclusive right to repair, replace, move or remove the Equipment at its sole discretion. 4.4. Funding and Marketing Support. In consideration of Customer's performance of its obligations under this Agreement, Lime Rock Springs Co. shall make the following funding and marketing support to Customer: 4.4.1. Incentive Fee Paid to Customer. Lime Rock Springs Co. shall pay Customer over the course of the Agreement the sum of $21,000 as an incentive to enter into this Agreement (the "Incentive Fee"). The Incentive Fee shall be paid as follows: -2- On -Premise • [$5,000] — upon execution of this Agreement and annually, within ninety (90) days of the annual anniversary of the Effective Date. - Plus, $2,000 Annually will be spent by Lime Rock Springs Co. at Leisure Services properties on (rounds of golf, family pool parties, etc.). In the event Lime Rock Springs Co. does not spend the required $2,000 in any year, it shall pay Customer the difference between $2,000 and the actual amount spent within thirty (30) days prior to the annual anniversary of the Effective Date. 5. Commitments of the Customer 5.1. Purchase of Beverage Products. Customer agrees to Purchase all Beverage Products offered for sale, dispensed by machine or person or otherwise distributed by or on behalf of Customer at the Outlet(s) exclusively from Lime Rock Springs Co. 5.2. Other Beverage Product Sales Prohibited. Customer agrees to prohibit the sale, dispensing and distribution of Beverage Products other than those Beverage Products supplied by Lime Rock Springs Co. at the Outlet(s). 5.3. Placement of Equipment and Electrical Supply. Customer shall insure that the Equipment is placed at locations within the Outlet(s) as shall be mutually agreeable to Customer and Lime Rock Springs Co. Further, Customer shall insure that the appropriate supply of electricity or other utilities necessary to operate and maintain the Equipment is provided. 5.4. Equipment Maintenance. Customer agrees to cooperate with Lime Rock Springs Co. in maintaining the Equipment in good working order throughout the Term. Customer shall use reasonable efforts to keep the Equipment in clean and sanitary condition. In addition, Customer agrees to promptly notify Lime Rock Springs Co. of any need for repair or service, and to cooperate fully with Lime Rock Springs Co. in effecting necessary repairs or service to the Equipment. 5.5. Brands. The Fountain Products and Packaged Products shall be served at the Outlet(s). Throughout the Term of the Agreement, Lime Rock Springs Co. reserves the right to substitute brands as a result of product innovation or consumer demands. 5.6. Brand Identification. Customer will permit brand identification by Lime Rock Springs Co. on all Equipment provided. -3- On -Premise 5.7. No Re -Sale. Customer will use the Postmix Products only to prepare the Fountain Products: (i) in accordance with procedures and standards established by Lime Rock Springs Co.; and (ii) only for immediate or imminent consumption and shall not resell the Postmix Products either to non-affiliated outlets or to consumers in any form other than the Fountain Products. 5.8. List of Outlets. Exhibit A lists all the Outlets of Customer. For the remaining of the Term, Customer shall continue to be responsible for promptly notifying Lime Rock Springs Co. in writing of each Outlet that is opened, acquired, closed or sold, and the relevant information pertaining thereto. 5.9. Payment for Beverage Products. Customer shall pay Lime Rock Springs Co. for Beverage Products supplied under this Agreement in accordance with pricing as determined by Lime Rock Springs Co. from time to time, currently within thirty (30) days of the delivery of the Beverage Products. 6. Representations of the Customer 6.1. Customer represents that it is authorized by law to enter into this Agreement and that the person executing this Agreement on behalf of Customer has the authority to bind Customer to the terms of this Agreement. 6.2. Customer represents and warrants that it has complied with all laws necessary to execute this Agreement, including, but not limited to, any laws relating to procurements by competitive bidding, and that this Agreement is in conformance with such laws. 6.3. Customer represents and warrants to Lime Rock Springs Co. that the execution, delivery and performance of the Agreement by Customer will not violate any agreements with, or rights of, third parties. Representations of Pepsi -Cola 7.1. Lime Rock Springs Co. represents and warrants that it is a corporation duly organized, validly existing and in good standing under the laws of the State of Iowa. 7.2. Lime Rock Springs Co. represents and warrants that it has authority to enter into this Agreement and that the person signing this Agreement on behalf of Lime Rock Springs Co. has the authority to enter into this Agreement on behalf of Lime Rock Springs Co. 8. Pricing. Lime Rock Springs Co. will provide a thirty (30) day notice of any price increases that may occur during the Term for the Beverage Products. Lime Rock Springs Co. will also cap annual price increases to Customer at 4%. Price increases will be based on pricing provided in Exhibit B. -4- On -Premise 9. Right of Offset. Lime Rock Springs Co. reserves the right to withhold payments due hereunder as an offset against amounts not paid by Customer for Packaged Products and Postmix Products delivered to Customer. 10. Non -Disclosure 11. Rights Upon Termination. Upon termination or expiration of this Agreement, Customer shall permit Lime Rock Springs Co. access to the premises where the Equipment is located for the purposes of removing the Equipment within thirty (30) days of the date of " such termination or expiration. Until such time as all Equipment is removed, Customer's obligations as set forth in Sections 4.2 and 4.3 of this Agreement shall continue. 12. Default. 12.1.1 If either party is in default of any of its obligations under this Agreement and such default continues for thirty (30) days (ten (10) days in the event of nonpayment of an invoice by its due date) after written notice specifying such default is given by the party not in default to the defaulting party, the party not in default may, at its option, terminate this Agreement or pursue any remedy available at law or in equity, including, in the case of Lime Rock Springs Co., the rights set forth in Sections 11 and 12. 12.1.2 Customer my terminate this Agreement with or without case upon thirty (30) days written notice delivered to Lime Rock Springs Co. 13. Independent Contractor. The parties acknowledge and agree that the relationship created by this Agreement is that of an independent contractor, and not that of a partnership, joint venture, or any other form of business organization, nor does this Agreement establish an employer/employee or principle/agent relationship. 14. Indemnification. 14.1. Lime Rock Springs Co. shall indemnify defend, and hold Customer, its affiliates, shareholders, directors, officers, employees and agents from and against any and all liabilities, losses, damages costs and attorneys' and accountants' fees and expenses, court costs, witness fees, and all other out-of-pocket expenses incurred or suffered by Customer, its affiliates, shareholders, directors, officers, employees and agents by reason of, resulting from, or in connection with any negligent or willful omission or act of Lime Rock Springs Co., its agents, employees, students and invitees or any breach of any duty, obligation, representation or warranty of Lime Rock Springs Co. under this Agreement. 14.2. Customer shall indemnify, defend, and hold Lime Rock Springs Co. its affiliates, shareholders, directors, officers, employees and agents from and against any and all liabilities, losses, damages costs and attorneys' and accountants' fees and expenses, court costs, witness fees, and all other out-of-pocket expenses incurred or suffered by Lime Rock Springs Co. its affiliates, shareholders, directors, officers, employees and agents by reason of, resulting from, or in connection with any -5- On -Premise negligent or willful omission or act of Customer, its officers, agents, or employees, or any breach of any duty, obligation, representation or warranty of Customer under this Agreement. 14.3. Insurance. Lime Rock Springs Co. shall at all times during the performance of this Agreement provide insurance as described in the attached Insurance Schedule. 15. Notices. Any notice or other communication given hereunder shall be in writing and shall be deemed to be given when either personally delivered, sent by facsimile transmission or mailed by certified mail, return receipt requested, to the following address, or to such other address as such party shall have designated by written notice: If to Pepsi -Cola: If to the Customer: Lime Rock Springs Co. 10537 HWY 52 N Dubuque, Iowa 52001 Attn: Sales Manager Dubuque Leisure Services 2200 Bunker Hill Rd Dubuque, Iowa 52001 Attn: Recreation Division Manager 16. Entire Agreement. This Agreement constitutes the entire agreement between Customer and Lime Rock Springs Co. with respect to its subject matter and shall not be modified or amended except by a writing signed by both parties. The provisions of this Agreement supersede all prior oral and written quotations, communications, agreements and understandings of the parties with respect to the subject matter of this Agreement. 17. Third Party Provider. To the extent Customer contracts with any third party to provide Beverages at the Outlets, the provisions of Section 3.1 shall apply, such that all Beverages provided by the third party shall be obtained from Lime Rock Springs Co. 18. Government Actions. If the action of any local, state or federal government entity (including, but not limited to, the imposition of sales taxes, fees, deposit requirements, or other government -imposed fees) increases the cost of, or the fees associated with, selling any or all of the Beverage, such increases shall be paid by Customer, and shall not be used in the calculation under a price provision, if any, contained in this Agreement 19. Governing Law, Venue. This Agreement shall be governed by the laws of the State of Iowa. The parties agree that any actions arising under this Agreement shall be venued in the District Court of Dubuque County, Dubuque, Iowa. 20. Severability. In the event that any term or provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, that provision shall be deemed severed from this Agreement, and the remainder of this Agreement shall be enforced without such severed provision, which shall not impair the validity or the remaining provisions hereof. -6- On -Premise 21. Waiver. The waiver by either party of any default by the other party of any provision of this Agreement shall be limited to the particular instance and shall not operate nor be deemed to waive any future defaults of the same provision, nor of any other provisions of this Agreement. 22. Headings. All section headings herein are inserted for convenience only and shall not modify or affect the construction or interpretation of any provision of this Agreement. 23. Binding Nature. This Agreement shall be binding upon and inure to the benefit of all the parties named herein and their respective successors and assigns. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date. Lime Rock Springs Co By: Print Name: Title: Date: SLavie geeSe.-- City of Dubuque, Iowa By: Print Name: Title: Date: Roy D. Buol Mayor April 6, 2020 -7- On -Premise OUTLETS under the banner of The Dubuque Leisure Services • Flora Pool • Sutton Pool • Bunker Hill Golf Course • McAleece Sports Complex • Port of Dubuque Marina • Veterans Memorial Park Exhibit A -8- Postmix National Prices EFFECTIVE 2020 1► Soft Prinks Pepsi Dist Pepsi Mountain Dew Mist TWST Rochester Ruut Beer Pepsi zero Cherry Pepsi Cai. Free Dive Pepsi Diet Mountain Dew Code Red MOuntaln Dew Mist TWST Diet Mist TWST Orange Crush Mug Root Beer DOG Brisk Unsweetened Brisk Raspberry Brisk i! Cal Green with Peach Upton Liquid Cancer rate Unsweet Lipton Liquid Concentrate Sweet 3 41 Gallons Per Re .in -no x 5-ga1 5-gal 0-gal S.gal 5.g41 3-gal 3-gni 3-gal 3-gal 3-5a1 3-gal 3-gal 3-gal 3-gal 3.gal 100% Orange Juica 100%6 Apple Juice Cra+erry Bloody Mary Tropicana Lemonade Tropicana Pink Lemonade Tropicana Fruit Punch Yumberly Pomegranate 0-Calorie Gatorade Fruit Punch Gatarods Lemon Lime Sour Ton Ic Super Parrot Energy LIME ROCK SR. opistiNgg en I .!/ CUIL{PC SOP 100 r‘zie Arr Prins Per Price Par Bag -In -Box coim S113.25 $16.65 $33.25 516.95 Sa3.25 $16.65 $$3.25 $15.65 583.25 $16.9$ $4995 $16.65 $49.95 $16.55 549.95 $16.65 $49.95 S16.63 $49.95 $16.65 $49.95 $16.65 $49.95 $16.93 $49.95 $16.65 $.49.95 $16.55 $49.95 $1$`65 3-gal $49.95 3101 $49.95 3-gal ez23 $49.95 3-poi $55.66 3-gal $61.47 $16.65 * $16.65 $18.56 $29.49 3.gal $93.33 $31.11 3-gal $93.33 531.11 3-gal $84.87 $29.29 3-gal 5E14.67 $26.29 3-gal $49.99 $16.65 3.gal $49.96 $16.65 3-gal $49.95 $16.66 3-gal $49.95 $16.65 3-gal $52.41 S17.47 3-gal $52.41 $17.47 3-gal $49.95 $16.65 3-gal $49.95 $16.33 3-gal $192.79 $54.26 A nM4ahemp AL, afdmtrm.400 fi.gt Ilv.xnf fed Caw wp sal L9 rl.gn.la.*.Okra A.ns4 ropo Tam r,.,rd}..n.A..firm! fropicana ['fruiter GAMBADK On -Premise Exhibit B -9- On -Premise Bottle and Can Pricing 20oz Soft Drinks 12oz Soft Drinks 20oz Gatorade 20oz Klarbrunn Water 1-Liter Klarbrunn Water 16oz Rockstar Energy Drink 18.5oz Lipton PureLeaf 12pk Fountain per gallon 20Ib CO2 $18.00 $ 8.50 $18.50 $13.40 $ 9.00 $28.00 $13.42 $16.65 $22.00 -10-