HomeMy WebLinkAboutC-977-1 - Lease Agreement for the Harbor Island Bridge1
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LEASE AGREEMENT BY AND BETWEEN
THE CITY OF NEWPORT BEACH AND
V
HARBOR ISLAND COMMUNITY ASSOCIATION
FOR THE HARBOR ISLAND BRIDGE
THIS LEASE AGREEMENT ("Lease") is made and entered into as of the 18th day
of November 2025 ("Effective Date"), by and between THE CITY OF NEWPORT BEACH,
a California municipal corporation and charter city ("Lessor" or "City") and HARBOR
ISLAND COMMUNITY ASSOCIATION, a California nonprofit, common interest
development association corporation ("Lessee"). Lessor and Lessee may individually be
referred to as "Party" and collectively referred to as "Parties" herein.
RECITALS
A. City, by virtue of a 1978 legislative grant found in Chapter 74 of the Statutes of
1978, as amended ("Beacon Bay Bill"), acts on behalf of the State of California as
the trustee of Tidelands located within the City's limits.
B. Tidelands are defined as certain tidelands and submerged land (whether filled or
unfilled), located in the City of Newport Beach, County of Orange, State of
California granted to the City of Newport Beach, pursuant to the Beacon Bay Bill.
The Tidelands must be used to promote the public's interest in water -dependent
or water -oriented activities, as described more fully in the Tidelands Grant.
C. The Beacon Bay Bill provides that the Tidelands shall not, at any time, be granted,
conveyed, given, or alienated to any individual, firm or corporation for any purpose
whatever except pursuant to Lessor's grant of either a franchise or lease.
D. The Beacon Bay Bill authorizes Lessor to enter into leases of the Tidelands for a
period not exceeding fifty (50) years so long as such leases are consistent with
Lessor's obligations to hold the Tidelands in trust for the uses and purposes
contained in the Tidelands Grant.
E. Harbor Island consists of filled and unfilled Tidelands located in lower Newport Bay
that was developed with thirty-six single-family residential properties within Harbor
Island, Newport Beach, California ("Harbor Island").
F. The Property is defined as those filled, tide, and submerged lands lying between
the adjudicated mean high tide line and the City's public right-of-way across the
channel between Beacon Bay and Harbor Island to the mean high tide line and
recreation area on Harbor Island, inclusive of the submerged "water covered"
tidelands areas between the bulkhead line and pierhead lines, and between the
pierhead lines crossing the channel ("Property"). The Property, which Lessor holds
interest in trust on behalf of the State of California, is more particularly depicted in
Exhibit 'A" is attached hereto and incorporated by reference.
G. Lessee is a nonprofit common interest development corporation, organized to
manage and govern the owners of real property within Harbor Island.
H. Harbor Island is accessed by a vehicular bridge that begins at the terminus of the
roadway beginning at 101 Harbor Island Road, spans over the public Tidelands
and ends at 40 Harbor Island Road, Newport Beach, California 92660. Lessee has
built and currently maintains certain improvements consisting of a bridge, pilings,
guard shack, parking space, and associated improvements ("Improvements"),
which require retrofitting, to provide access to the residential properties located at
Harbor Island. A portion of the Improvements are necessarily located on the
Property and occupy approximately 5,262 square feet (hereinafter "Premises"),
which are the subject of this Lease, and are more particularly described/depicted
in Exhibit "A."
The Tidelands Grant authorizes Lessor to enter into leases of the Tidelands for a
period not exceeding fifty (50) years so long as such leases are consistent with
Lessor's obligations to hold the Tidelands in trust for the uses and purposes
contained in the Tidelands Grant.
J. Lessor has not conducted an open bid process for the lease of the Premises as is
generally required by City Council Policy F-7 because the City is limited by the
Tidelands Grant from converting the Property to another use, and changing the
lessee of the Premises would result in vacancy and other expenses which would
outweigh other financial benefits to the City and inequities to residents of Harbor
Island. The continued operation of the Improvements and its recreational uses
such as providing publicly navigable waters, in which Lessee actively manages are
consistent with the limitations and restrictions imposed on the Property by, but not
limited to, the Tidelands Grant and Council Policy F-7.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS
hereinafter set forth, it is agreed as follows:
1. DEFINITIONS
The following words in this Lease have the definitions set forth in this section
unless otherwise apparent from their context:
"City Manager" means the City Manager of the City of Newport Beach or his or her
designee.
2. PREMISES
Lessor hereby leases to Lessee, for the time specified in Section 5 (TERM), the
"Premises" described above except that the water covered areas is understood by Lessee
as not included in the use of Premises.
3. LIMITATION OF THE LEASEHOLD
This Lease and the rights and privileges granted Lessee in and to the Premises
are subject to all covenants, conditions, restrictions, and exceptions of record or apparent,
including those which are set out in the Tidelands Grant and that certain Grant of
HARBOR ISLAND COMMUNITY ASSOCIATION Page 2
Easement to Southern Counties Gas Company of California, recorded in the County of
Orange on May 15, 1939 as Instrument Number OR_00993_417. Nothing contained in
this Lease or in any document related hereto shall be construed to imply the conveyance
to Lessee of rights in the Premises which exceed those owned by Lessor, or any
representation or warranty, either expressed or implied, relating to the nature or condition
of the Premises or Lessor's interest therein. Lessee acknowledges that Lessee has
conducted a complete and adequate investigation of the Premises and that Lesse has
accepted the Premises in its "as is" condition.
4. USE
4.1 Lessee shall have use of the Premises to maintain a vehicular bridge to
allow access to the Harbor Island residences conditioned upon Lessee retrofitting,
reconstructing, maintaining and managing the Premises and the Improvements during
the term of the Lease, consistent with the Statutes of the State of California and City
Charter of the City of Newport Beach.
4.2 Lessee agrees not to use the Premises for any other purpose nor to engage
in or permit any other activity within or from the Premises.
5. TERM
5.1 The term of this Lease shall be fifty (50) years, commencing on November
18, 2025 ("Commencement Date"). Lessee understands and agrees that this Lease is
subject to termination as provided in Section 40 (TERMINATION).
5.2. Holding Over. This Lease shall terminate and become null and void without
further notice upon the expiration of the Term of this Lease. In the event Lessee shall
continue in possession of the Premises after the expiration of this Lease, such possession
shall not be considered a renewal of this Lease but a tenancy from month to month and
shall be governed by the conditions and covenants contained in this Lease. The month -
to -month tenancy may be terminated without cause by Lessee or Lessor upon thirty (30)
calendar days' prior written notice to the other.
6. RENT
6.1 Commencing on the Effective Date and continuing until adjusted pursuant
to Section 7 (REVISION OF RENT) or Section 8 (REAPPRAISAL OF RENT) of this
Lease, Lessee agrees to pay as rent for the Premises Forty Thousand Nine Hundred
Thirty Eight Dollars and 36/100 ($40,938.36) per year, payable on or before December
1, 2025 and on or before each anniversary of the effective date of this Lease thereafter,
so long as tenancy continues. In the event the obligation to pay rent terminates on some
date other than the anniversary of the effective date of this Lease, the rent shall be
prorated to reflect the actual period of tenancy.
6.2 Additional Rent. Lessee shall pay as "Additional Rent" for the Premises,
within ten (10) calendar days of Lessor's demand therefor (unless a different time for
payment is expressly provided in this Lease), all other amounts required by this Lease, in
HARBOR ISLAND COMMUNITY ASSOCIATION Page 3
addition to Rent. Additional Rent does not reduce or offset Lessee's obligations to pay
Rent.
6.3 No Abatement or Reduction in Rent. Lessee has no right to any abatement,
setoff or reduction in Rent or Additional Rent. No endorsement or statement on any check
or any letter accompanying any check or payment will be deemed an accord and
satisfaction, and Lessor may accept such check or payment without prejudice to Lessor's
right to recover the balance or pursue any other available remedy.
6.4 Net Lease. Rent, as defined in this Lease, is based upon Lessee's material
representation and covenant that it will pay all expenses, costs, taxes; assessments, fees
or charges, and incur all liabilities, of every kind in any way relating to, or in connection
with, the Premises and the Improvements during the Term. Accordingly, Lessee will
promptly pay all expenses, costs, taxes, assessments, fees or charges, and incur all
liabilities, of every kind and description relating to, or in connection with, the Premises
and the Improvements during the Term.
7. REVISION OF RENT
Annually, upon each successive anniversary of the Effective Date, the rent
specified in Section 6 (RENT) shall be adjusted to reflect the increases in the cost of living
as indicated by the Consumer Price Index described below. Rent may be adjusted if the
Consumer Price Index for the Los Angeles — Long Beach — Anaheim Area, All Urban
Consumers, All Items ("Index"), as published by the United States Department of Labor,
Bureau of Labor Statistics ("Bureau"), increases over the Base Period Index. The initial
"Base Period Index" shall be the Index for the calendar month which is four (4) months
prior to the month of the Effective Date's annual anniversary. The initial Base Period Index
shall be compared with the Index for the same calendar month for each subsequent year
("Comparison Index"). The Comparison Index used for a given year's adjustment
calculation will become the Base Period Index for purposes of the next annual Rent
adjustment calculation. If the Comparison Index is higher than the Base Period Index,
then Rent for the next year shall be increased by the amount of such percentage change.
In no event shall Rent be reduced below the current Rent. Should the Bureau discontinue
the publication of the above Index, or publish same less frequently, or alter same in some
other manner, then the parties shall adopt a substitute Index or substitute procedure
which reasonably reflects and monitors consumer prices.
8. REAPPRAISAL OF RENT
Notwithstanding the Index adjustments described above pursuant to Section 6
(RENT) and as adjusted by Section 7 (REVISION OF RENT) of this Lease, if Lessor, in
its sole and absolute discretion, believes that notwithstanding such adjustments, monthly
Rent, as adjusted, does not accurately reflect the fair market rental value of the Premises,
Lessor may elect to further adjust monthly Rent at the commencement of the thirtieth
(30th) Lease Year. Lessor will provide notice to Lessee not earlier than six (6) months
nor later than three (3) months prior to the expiration of the twenty-ninth (29th) Lease
Year of Lessor's election to further adjust monthly Rent. Within fifteen (15) days
HARBOR ISLAND COMMUNITY ASSOCIATION Page 4
thereafter, Lessor and Lessee will attempt to agree upon an adjustment in Rent. If Lessor
and Lessee are unable to agree, the Premises will be appraised to determine its fair
market rental value. Lessor shall submit three (3) California licensed appraisers to
Lessee; Lessee shall select one (1) appraiser from the three (3) submitted appraisers to
appraise the Property. Lessor shall pay all costs associated with the appraiser and the
appraisal. The fair market rental value determined by the appraiser will constitute monthly
Rent for the thirtieth (30th) Lease Year and each successive year remaining on the Lease;
provided, however, that in no event will monthly Rent so determined be less than that
otherwise payable through the annual Index adjustments described herein.
9. RENT PAYMENT PROCEDURE
All payments of Rent shall be made in lawful money of the United States of America
and shall be paid to Lessor in person or by United States' mail, or overnight mail service,
at the Cashier's Office located at 100 Civic Center Drive, Newport Beach, CA 92660, or
to such other address as Lessor may from time to time designate in writing to Lessee. If
requested by Lessor, Lessee shall make payments electronically (at
www.newportbeachca.gov) or by wire transfer (at Lessee's cost). Lessee assumes all risk
of loss and responsibility for late charges and delinquency rates if payments are not timely
received by Lessor regardless of the method of transmittal.
10. CHARGE FOR LATE PAYMENT
10.1 Late Payment. Lessee hereby acknowledges that the late payment of Rent
or other sums due hereunder will cause Lessor to incur costs not contemplated by this
Lease, the exact amount of which is extremely difficult to ascertain. Such costs include,
but are not limited to, processing and accounting charges. Accordingly, any sum owed
by Lessee that is not paid within five (5) days of its due date shall be subject to a ten
percent (10%) late charge. Lessor and Lessee agree that this late charge represents a
reasonable estimate of such costs and expenses and is fair compensation to Lessor for
its loss suffered by such late payment by Lessee.
10.2 Interest on Unpaid Sums. Unpaid sums due to either Lessor or Lessee
under this Lease shall bear interest at the rate of ten percent (10%) per annum on the
unpaid balance, including but not limited to late payment penalties, from the date due until
paid.
11. CONSTRUCTION AND/OR ALTERATION BY LESSEE
11.1 Proposed Improvements.
(a) Subject to compliance with all applicable laws, Lessee shall make certain
improvements to the Premises as shown on Exhibit "B" ("Proposed Improvements"),
attached hereto and incorporated herein, which are intended to maintain the
Improvements in good repair. The Proposed Improvements may be revised by or modified
by Lessee in order to obtain entitlements and/or building permits from the applicable local
and state agencies. All Proposed Improvements shall be submitted for review of
improvement plans and permitting, and construction, and shall be subject to the prior
HARBOR ISLAND COMMUNITY ASSOCIATION Page 5
written approval of the City Manager or his/her designee, which approval shall not be
unreasonably delayed or withheld. The City Manager's or his/her designee's failure to
provide written approval or disapproval of any such submittal by Lessee within thirty (30)
days shall be deemed approval thereof. The City Manager's or his/her designee's failure
to provide such notice shall not relieve Lessee's responsibility to comply with all applicable
laws.
(b) Lessee shall submit plans, diligently pursue their approval by City in its
regulatory capacity, and any other necessary permits or approvals from federal, state, or
local agencies having such oversight, and complete construction of the Proposed
Improvements within the first three (3) years of the Term.
11.2 Lessor's Consent. No structures or facilities other than those listed in
Section 4 (USE) of this Lease shall be constructed, erected, altered, or made within the
Premises without prior written consent of Lessor. Any conditions relating to the manner,
method, design and construction of said structures, improvements, or facilities fixed by
the Lessor shall be conditions hereof as though originally stated herein.
11.3 Permits and Approvals. Lessee shall be required to obtain, prior to any
construction, all permits, licenses or approvals that may be required from any local, state
or federal entities. As required by law, Lessee shall obtain, and be responsible for the
costs for all building permits and other required permits as may be required prior to the
commencement of any Proposed Improvements. If applicable, Lessee shall be
responsible, at its sole cost and expense, for compliance with the California
Environmental Quality Act ("CEQA") and the California Coastal Act in connection with
Lessee's operation and use of the Premises.
11.4 Payment of Costs. Lessee, shall bear all costs and expenses associated
with any Proposed Improvements and alterations, including any fees assessed on the
Premises by any governmental, or quasi -governmental agency or authority in connection
with any regional transportation or other public improvements and school district taxes,
development fees and assessments.
11.5 Lessee's Architects and Contractors. All Proposed Improvements and
alterations to the Premises shall be designed, selected or constructed, as applicable, by
qualified and licensed (where required) architectural, design, engineering and
construction firms selected by Lessee. Any contractors and subcontractors hired by
Lessee shall be fully licensed and bonded, and shall obtain insurance in an amount and
form pursuant to standard industry custom and practice and as outlined in Exhibit "C" to
this Lease, and approved by the City's Risk Manager covering the Proposed
Improvements or alterations to be constructed. City shall be named as an additional
insured on the contractor's and any subcontractor's policies
11.6 Prevailing Wages. If any of the work contemplated under Section 11 of this
Agreement is considered a "public work", pursuant to the applicable provisions of the
California Labor Code, not less than the general prevailing rate of per diem wages, as
provided in the California Labor Code, including legal holidays and overtime work for each
HARBOR ISLAND COMMUNITY ASSOCIATION ' Page 6
craft or type of workman needed to execute the work contemplated under this Section 11
(CONSTRUCTION AND/OR ALTERATION BY LESSEE) shall be paid to all workmen
employed on the work to be done according to this Section 11 (CONSTRUCTION
AND/OR ALTERATION BY LESSEE) by the Lessee's contractors and any subcontractor.
Lessee shall defend, indemnify and hold the City, its elected officials, officers, employees
and agents free and harmless from any claim or liability arising out of any failure or alleged
failure to comply with California labor laws. In accordance with the California Labor Code
(Sections 1770 et seq.), the Director of Industrial Relations has ascertained the general
prevailing rate of per diem wages in the locality in which the work is to be performed for
each craft, classification, or type of workman or mechanic needed to execute the
Proposed Improvements or any alterations. A copy of said determination is available by
calling the prevailing wage hotline number (415) 703-4774, and requesting one from the
Department of Industrial Relations. Lessee's contractors and subcontractors are required
to obtain the wage determinations from the Department of Industrial Relations and post
at the job site the prevailing rate or per diem wages. It shall be the obligation of Lessee's
contractors or any subcontractor under him/her to comply with all State of California labor
laws, rules and regulations and the parties agree that the City shall not be liable for any
violation thereof.
11.7 Quality of Work Performed. All Proposed Improvements and alterations
shall be performed in a good and workmanlike manner, shall comply with the plans and
specifications submitted to City, and shall comply with all applicable governmental permit
requirements and laws in force at the time permits are issued. Any Proposed
Improvements and alterations shall be performed between 7:00 a.m. and 6:00 p.m. on
non -holiday weekdays.
12. LIENS
Lessee shall not permit to be imposed, recorded or enforced against the Premises,
any portion thereof or any structure or improvement thereon ("Protected Property"), any
mechanics, materialmen's, contractors or other liens arising from, or any claims for
damages growing out of, any construction of the Improvements, and/or repair,
maintenance, construction or alteration of the Premises. In the event any lien or stop
notice is imposed or recorded on Protected Property, and such lien or stop notice arises
out of, is related to or connected with, or based on, Lessee's conduct, Lessee shall pay
or cause to be paid all such liens, claims or demands before any action is brought to
enforce the same against Protected Property. Notwithstanding the foregoing, if Lessee in
good faith contests the validity of any such lien, claim or demand, then Lessee shall, at
its sole expense, defend against such lien, claim or demand provided that Lessee
provides Lessor full defense and indemnity therefrom, and provided Lessee shall pay and
satisfy any adverse judgment that may be rendered in connection therewith before any
enforcement against Lessor or Protected Property.
13. MAINTENANCE OBLIGATIONS OF LESSEE
13.1 Lessee shall keep and maintain the Premises and the Improvements of any
kind which may be erected, installed, maintained, repaired or made thereon in good
HARBOR ISLAND COMMUNITY ASSOCIATION Page 7
condition and in substantial repair at its sole cost through the Term of the Lease. It shall
be Lessee's responsibility to take all steps necessary or appropriate to maintain such a
standard of condition and repair.
13.2 Lessee expressly agrees to maintain the Premises and the Improvements
in a safe and clean condition, to the reasonable satisfaction of Lessor and in compliance
with all applicable laws.
13.3 If Lessee fails to maintain or make repairs or replacements as required,
Lessor shall notify Lessee in writing of said failure. Should Lessee fail to correct the
situation within three days after receipt of written notice, Lessor may make the necessary
correction or cause it to be made and the cost thereof, including but not limited to the cost
of labor, materials, and equipment and administration; shall be paid by Lessee within ten
(10) days of receipt of a statement of said cost from Lessor. Lessor may, at its option,
choose other remedies available herein, or by law.
13.4 Damage to or Destruction of Improvements. In the event of damage to or
destruction of Lessee's buildings, facilities, or the Improvements located on the Premises
or in the event the buildings, facilities, or improvements located on the Premises are
declared unsafe or unfit for use or occupancy by a public entity with the authority to make
and enforce such declaration, Lessee shall restore the Premises to substantially the same
condition as immediately prior to such destruction at Lessee's own expense to permit full
use and occupancy of the Premises for the purposes required by this Lease. Repair,
replacement, or reconstruction of improvements within the Premises shall be
accomplished in a manner and according to plans approved by Lessor no later than ninety
(90) days following the event or damage to or destruction. Failure of Lessee to complete
the repair, replacement, or reconstruction of the structure or improvements necessary to
permit full use and occupancy of the Premises for the purposes required by this Lease
within the time periods prescribed herein shall constitute a material breach of the terms
of this Lease.
14. INSURANCE
Without limiting Lessee's duties of defense and indemnification under this Lease,
Lessee shall obtain, provide and maintain at its own expense, a policy or policies of
insurance of the type, amounts and form acceptable to Lessor. The policy or policies
shall provide, at a minimum, those items described in Exhibit "C," which is attached hereto
and incorporated herein by reference. Additionally, prior to commencement of
construction of the Improvements and/or repair, maintenance, construction or alteration
of the Premises, and for the duration of time that they are in the course of performing
such Improvements and/or repair, maintenance, construction or alteration, Lessee shall
obtain, provide and maintain at its own expense, a policy or policies of insurance of the
type, amounts and form acceptable to Lessor.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 8
15. BONDING
In the event that the total amount payable by Lessee for construction, repair,
maintenance of the Improvements and Proposed Improvements that will exceed Twenty
Five Thousand Dollars and 00/100 ($25,000.00), Lessee shall obtain, or cause its general
contractor who performs the work to obtain, and provide and maintain at its own expense:
(1) a Labor and Materials Payment Bond in the amount of one hundred percent (100%)
of the total amount to be paid for the Work, in substantial conformance with the form
attached hereto as Exhibit "D" and incorporated herein by this reference; and, (2) a
Faithful Performance Bond in the amount of one hundred percent (100%) of the total
amount to be paid for the Work, in substantial conformance with the form attached hereto
as Exhibit "E" and incorporated herein by this reference. The Labor and Materials
Payment Bond and the Faithful Performance Bond shall be issued by an insurance
organization or surety: (1) currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California; (2) listed as an acceptable surety in the
latest revision of the Federal Register Circular 570; and, (3) assigned a Policyholders'
Rating A (or higher) and Financial Size Category Class VI (or larger) in accordance with
the latest edition of Best's Key Rating Guide: Property Casualty. Lessee shall deliver to
Lessor, concurrently with Lessee's execution of the Lease with the general contractor for
any construction to or Work done to the Improvements, a Labor and Materials Payment
Bond and Faithful Performance Bond, a certified copy of the "Certificate of Authority" of
the Insurer or Surety issued by the Insurance Commissioner which authorizes the Insurer
or Surety to transact surety insurance in the State of California.
16. ASSIGNING, SUBLETTING AND ENCUMBERING
Lessor and Lessee acknowledge that Lessor is entering into this Lease in reliance
upon the experience and abilities of Lessee to successfully perform the obligations, terms,
and covenants as set forth in this Lease. Lessee shall not mortgage, pledge,
hypothecate, encumber, transfer, sublease, or assign its interest in this Lease, the
Property, Premises, the Improvements or any structure located on the Premises.
17. STATE LANDS COMMISSION LEASING POLICY
Lessor and Lessee acknowledge that the consideration for this Lease and any
other terms and conditions provided in this Lease do not necessarily reflect the leasing
policy of the State Lands Commission. The method for determining rent provided in this
Lease shall not be used for the purpose of establishing rent in any future leases involving
filled or unfilled tide or submerged land.
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All notices pursuant to this Lease shall be addressed as set forth below or as either
party may hereafter designate by written notice and shall be sent through the United
States mail in the State of California, duly registered or certified, return receipt requested,
with postage prepaid. If any notice is sent by registered or certified mail, as aforesaid, the
same shall be deemed to have been served or delivered twenty-four (24) hours after
mailing thereof as above provided. Notwithstanding the above, Lessor may also provide
HARBOR ISLAND COMMUNITY ASSOCIATION Page 9
notices to Lessee by personal delivery or by regular mail and any such notice so given
shall be deemed to have been given upon receipt.
LESSOR
City of Newport Beach
Attn: City Manager
100 Civic Center Drive
Newport Beach, CA 92660
LESSEE
Harbor Island Community Association
Attn: President
23792 Rockfield Boulevard, Suite 100
Lake Forest, CA 92630
Lessor shall provide access to and/or a copy of the Lease to Lessee and
successors upon request to the following office:
City of Newport Beach
Attn: Real Property Administrator
100 Civic Center Drive
Newport Beach, CA 92660
19. MEMORANDUM OF LEASE
In order to impart constructive notice of Lessee's obligations under the terms of
this Lease, Lessee shall cause any prospective transferee or assignee to sign the
"Memorandum of Lease", in a form as shown on Exhibit "F", attached hereto and made a
part hereof, and have the signature notarized. The signed and notarized Memorandum of
Lease shall be submitted to the City Manager as part of the documentation of the transfer
of interest as set forth in Section 16 (ASSIGNING, SUBLETTING AND ENCUMBERING).
20. LEASE ORGANIZATION
The various headings and numbers herein, the grouping of provisions of this Lease
into separate clauses and paragraphs, and the organization hereof, are for the purpose
of convenience only and shall not be considered otherwise.
21. PERMITS AND LICENSES
Lessee shall be required to obtain any and all approvals, permits, and/or licenses
which may be required in connection with the operation of the Premises as set forth herein
including approvals required by the California Coastal Commission. No permit, approval,
or consent given by Lessor, in its governmental capacity, shall affect or limit Lessee's
obligations hereunder, nor shall any approvals or consents given by Lessor as a party to
HARBOR ISLAND COMMUNITY ASSOCIATION Page 10
this Lease, be deemed approval as to compliance or conformance with applicable
governmental codes, laws, rules, or regulations.
22. UNLAWFUL USE
Lessee agrees no Improvements shall be erected, placed upon, operated, nor
maintained within the Premises, nor any business conducted or carried on therein or
therefrom, in violation of the terms of this Lease, or of any regulation, order of law, statute,
bylaws, or ordinance of a governmental agency having jurisdiction.
23. INSPECTION
Lessor or its authorized representative shall have the right at all reasonable times
to inspect the Premises to determine if the provisions of this Lease are being complied
with.
24. HOLD HARMLESS
24.1 Lessee hereby waives all claims and recourse against Lessor and the State
of California including the right of contribution for loss or damage of persons or property
arising from growing out of or in any way connected with or related to this Lease except
claims arising from the concurrent active or sole negligence of the State of California or
Lessor, or their officers, agents, and employees.
24.2 Lessee hereby agrees to indemnify, hold harmless and defend the State of
California and Lessor and their officers, agents, and employees, against any and all
claims, (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a "Claim;" collectively, "Claims"), which may arise from or in any manner
relate (directly or indirectly) to Lessee's, Lessee's employees, contractor, subcontractor,
agents, guests, invitees, sublessee's possession, occupation or use of the PREMISES,
including, without limitation, any claim, liability, loss, or damage arising by reason of:
(a) The death or injury of any person or damage to personal property related to
the condition of the Premises or Improvements or an act or omission of Lessee or an
agent, contractor, subcontractor, supplier, employee, servant, or sublessee of Lessee;
(b) Any work performed on the Premises or Improvements including the
construction and/or maintenance of the Improvements, or materials furnished to the
Premises or Improvements; and/or
(c) Lessee's failure to perform any provision of this Lease or to comply with any
requirement of law or any requirement imposed on the Premises or Improvements by any
duly authorized governmental agency or political subdivision.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 11
24.3 Lessee releases and also waives all claims against Lessor for damages
arising for any reason other than the gross negligent, intentional or willful acts of Lessor
and the State of California or their elected and appointed officers, agents, officials,
volunteers, employees. Neither Lessor nor the State of California shall be liable to Lessee
for any damage to the Premises, Lessee's nor its residents' property, caused in whole or
in part by acts of nature including, without limitation, waves, wind and tidal flows.
24.4 This indemnity shall apply to all claims and liability regardless of whether
any insurance policies are applicable.
24.5 Notwithstanding any provision to the contrary, the indemnity obligations set
forth in this Section 24 shall apply to all claims, demands, damages, losses, liabilities,
attorneys' fees, costs, or expenses including those arising in connection with City -
controlled tidelands, except to the limited extent such claims arise solely from conditions
or events occurring entirely within the City -controlled tidelands that: (1) are wholly
unrelated in any way, directly or indirectly, to the Premises; and/or (2) not caused or
contributed in any way, directly or indirectly, by the acts or omissions of Lessee or any of
its officers, directors, members, agents, employees, contractors, subcontractors,
licensees, vendors, suppliers, volunteers, invitees, or any person or entity acting on its
behalf or under its direction, control, or authorization. The Lessee's indemnity obligations
shall be construed broadly in favor of the City to ensure maximum protection and shall
not be limited by any other provision of this Agreement.
25. TAXES AND ASSESSMENTS
This Lease may create a possessory interest which is subject to the payment of
taxes levied on such interest including but not limited to Revenue and Taxation Code
Section 107.6. It is understood and agreed that all taxes and assessments (including but
not limited to said possessory interest tax) which become due and payable upon the
Premises shall be the full responsibility of Lessee, and Lessee shall cause said taxes and
assessments to be paid promptly before delinquency and before any fine, interest or
penalty is due or imposed by operation of law. Lessee shall, upon request, promptly
furnish to Lessor satisfactory evidence of payment.
26. SUCCESSORS IN INTEREST
Unless otherwise provided in this Lease, the terms, covenants, and conditions
contained herein shall apply to and bind the heirs, successors, executors, administrators,
and assigns of all the parties hereto, all of whom shall be jointly and severally liable
hereunder.
27. CIRCUMSTANCES WHICH EXCUSE PERFORMANCE
If either party hereto shall be delayed or prevented from the performance of any
act required hereunder by reason of acts of God, restrictive governmental laws or
regulations, or other cause without fault and beyond the control of the party obligated
(financial inability excepted), performance of such act shall be excused for the period of
the delay and the period for the performance of any such act shall be extended for a
HARBOR ISLAND COMMUNITY ASSOCIATION Page 12
period equivalent to the period of such delay. However, nothing in this clause shall excuse
Lessee from the prompt payment of any rental or other charge required of Lessee except
as may be expressly provided elsewhere in this Lease.
28. PARTIAL INVALIDITY
If any term, covenant, condition, or provision of this Lease is held by a court of
competent jurisdiction to be invalid, void, or unenforceable, the remainder of the
provisions hereof shall remain in full force and effect and shall in no way be affected,
impaired, or invalidated thereby.
29. UTILITIES
Lessee shall be responsible for and pay, prior to the delinquent date, all charges
for utilities supplied to the Premises including, without limitation, gas, electricity, sewer,
water, refuse collection, and telephone service. Satisfactory evidence of such payments
shall be delivered to Lessor within five (5) business days of a written request for such
information.
30. WAIVER OF RIGHTS
The failure of Lessor or Lessee to insist upon strict performance of any of the
terms, covenants, or conditions of this Lease shall not be deemed a waiver of any right
or remedy that Lessor or Lessee may have and shall not be deemed a waiver of the right
to require strict performance of all the terms, covenants, and conditions of the Lease.
31. DEFAULT IN TERMS OF THE LEASE BY LESSEE
31.1 Events of Default. The occurrence of any one (1) or more of the following
events shall constitute a material default and breach of this Lease by Lessee:
(a) The maintenance of the Premises in violation of any applicable provisions
of this Lease, City's Municipal Code and Zoning Code, State Law, Federal Law, and/or
the Lessee's CC&Rs;
(b) The failure by Lessee to make any payment of Rent when due if the failure
continues for ten (10) calendar days after written notice has been given to Lessee. In the
event that Lessor serves Lessee with a Notice to Pay Rent or Quit pursuant to applicable
unlawful detainer statutes, such Notice to Pay Rent or Quit shall also constitute the notice
required by this paragraph;
(c) The failure by Lessee to perform any of the provisions of this Lease and any
Exhibits attached hereto to be performed by Lessee, if the failure to perform continues for
a period of thirty (30) days after written notice thereof has been given to Lessee. If the
nature of Lessee's default is such that more than thirty (30) days are reasonably required
for its cure, then Lessee shall not be in default if Lessee commences the cure within said
thirty (30) day period and thereafter diligently prosecutes the cure to completion; or
HARBOR ISLAND COMMUNITY ASSOCIATION Page 13
(d) The making by Lessee of any general assignment, or general arrangement
for the benefit of creditors; the filing by or against Lessee of a petition to have Lessee
adjudged a bankrupt or a petition for reorganization or arrangement of any law relating to
bankruptcy unless the same is dismissed within sixty (60) days; the appointment of a
trustee or receiver to take possession of substantially all of Lessee's assets located at the
Property or of Lessee's interest in the Lease, where possession is not restored to Lessee
within thirty (30) days; or the attachment, execution or other judicial seizure of
substantially all of Lessee's assets located at the Property or of Lessee's interest in the
Lease, where such seizure is not discharged within thirty (30) days. Notices given under
this paragraph shall specify the alleged default and the applicable Lease provisions, and
shall demand that Lessee perform the provisions of this Lease or pay the rent that is in
arrears, as the case may be, within the applicable period of time. No such notice shall be
deemed a forfeiture or a termination of this Lease unless Lessor so elects in the notice.
31.2 Lessor's Remedies. In the event of any default by Lessee as defined in this
Lease, Lessor may, in addition to any rights or remedies permitted by law, do the
following:
(a) Terminate Lessee's right to possession of the Property by any lawful means,
in which case this Lease shall terminate and Lessee shall immediately surrender
possession of the Property to Lessor. In such event, Lessor shall be entitled to recover
from Lessee all amounts to which Lessor is entitled pursuant to Section 1951.2 of the
California Civil Code, or any other provision of law, including, without limitation, the
following:
(i) The worth at the time of award of the amount by which the unpaid Rent
for the balance of the term after the time of award exceeds the amount
of the loss that Lessee proves could be reasonably avoided; and
(i i) Any other amount necessary to compensate Lessor for all detriment
proximately caused by Lessee's failure to perform obligations pursuant
to this Lease or which in the ordinary course of things would be likely
to result from the breach, including, without limitation, the cost of
recovering possession, expenses of reletting (including necessary
repair, renovation and alteration, and any other reasonable costs. The
"worth at the time of award" of all rental amounts other than that
referred to in clause (i) above shall be computed by allowing interest
at the rate of five percent (5%) per annum from the date amounts
accrue to Lessor. The worth at the time of award of the amount
referred to in clause (i) shall be computed by discounting such amount
at one (1) percentage point above the discount rate of the Federal
Reserve Bank of San Francisco at the time of award.
(b) Without terminating or affecting the forfeiture of this Lease or, in the
absence of express written notice of Lessor's election to do so, relieving Lessee of any
obligation pursuant to this Lease, Lessor may, but need not, relet all or a portion of the
Property at any time, or from time -to -time, and on such terms and conditions as Lessor,
HARBOR ISLAND COMMUNITY ASSOCIATION Page 14
at its sole discretion, deems appropriate. Whether or not the Property is relet, Lessee
shall pay all amounts required by this Lease up to the date that Lessor terminates
Lessee's right to possession of the Property. Lessee shall make such payments at the
time specified in the Lease and Lessor need not wait until termination of the Lease to
recover sums due by legal action. If Lessor relets all or a portion of the Property, the
reletting shall not relieve Lessee of any obligation pursuant to this Lease; provided,
however, Lessor shall apply the Rent or other proceeds actually collected by virtue of the
reletting against amounts due from Lessee. Lessor may execute any Lease reletting all
or a portion of the Property and Lessee shall have no right to collect any proceeds due
Lessor by virtue of any reletting. Lessor shall not, by any reentry or reletting or other act,
be deemed to:
(i) Have accepted any surrender by Lessee of this Lease or the Property;
(ii) Have terminated this Lease; or
(iii) Have relieved Lessee of any obligation pursuant to this Lease unless
Lessor has given Lessee express written notice of Lessor's election to
do so.
(c) Lessor may terminate this Lease by express written notice to Lessee of its
election to do so. The termination shall not relieve Lessee of any obligation which has
accrued prior to the date of termination. In the event of termination, Lessor shall be
entitled to recover the amounts specified in this Lease.
31.3 Waiver of Right of Redemption. Lessee waives any right of redemption or
relief from forfeiture pursuant to California Code of Civil Procedure Sections 1174 and
1179 and/or pursuant to any existing or future statutory or decisional law in the event
Lessee is evicted or Lessor takes possession of the Property by reason of Lessee's
default.
32. RESERVATIONS TO LESSOR
The Premises are accepted "as is, where is" by Lessee subject to any and all
existing easements and encumbrances. Lessor reserves the right to install, lay, construct,
maintain, repair, and operate such sanitary sewers, drains, storm water sewers, pipelines,
manholes, and connections; water, oil, and gas pipelines; telephone and telegraph power
lines; and the appliances and appurtenances necessary or convenient in connection
therewith, in, over, upon, through, across, and along the Premises or any part thereof as
may be necessary to serve the Premises and/or Harbor Island, and to enter the Premises
for any and all such purposes. Lessor also reserves the right to grant franchises,
easements, rights of way, and permits in, over, upon, through, across, and along any and
all portions of the Premises as may be necessary to serve the Premises.
Lessor agrees that rights granted to third parties by reason of this clause shall
contain provisions that the surface of the land shall be restored as nearly as practicable
to its original condition upon the completion of any construction.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 15
Lessor further agrees that should the exercise of these rights temporarily interfere
with the use of any or all of the Premises by Lessee, the rental shall be reduced in
proportion to the interference with Lessee's use of the Premises.
33. DISPOSITION OF ABANDONED PERSONAL PROPERTY
If Lessee abandons the Premises or is dispossessed thereof by process of law or
otherwise, title to any personal property belonging to Lessee and left on the Premises
fifteen (15) calendar days after such. abandonment or dispossession shall be deemed to
have been transferred to Lessor. Lessor shall have the right to remove and to dispose of
such property without liability therefor to Lessee or to any person claiming under Lessee
and shall have no need to account therefor.
34. QUITCLAIM OF LESSEE'S INTEREST UPON TERMINATION
Upon termination of this Lease for any reason, including but not limited to
termination because of default by Lessee, Lessee shall execute, acknowledge, and
deliver to Lessor within 30 days after receipt of written demand therefor, a good and
sufficient deed whereby all right, title, and interest of Lessee in the Premises is
quitclaimed to Lessor. Should Lessee fail or refuse to deliver the required deed to Lessor,
Lessor may prepare and record a notice reciting the failure of Lessee to execute,
acknowledge and deliver such deed and said notice shall be conclusive evidence of the
termination of this Lease and of all right of Lessee or those claiming under Lessee in and
to the Premises.
35. LESSOR'S RIGHT TO RE-ENTER
Lessee agrees to yield and peaceably deliver possession of the Premises to
Lessor on the date of termination of this Lease, whatsoever the reason for such
termination. Upon giving written notice of termination to Lessee, Lessor shall have the
right to reenter and take possession of the Premises on the date such termination
becomes effective without further notice of any kind and without institution of summary or
regular legal proceedings. Termination of the Lease and re-entry of the Premises by
Lessor shall in no way alter or diminish any obligation of Lessee under the Lease terms
and shall not constitute an acceptance or surrender.
Lessee waives any and all right of redemption under any existing or future law or
statute in the event of eviction from or dispossession of the Premises for any lawful reason
or in the event Lessor re-enters and takes possession of the Premises in a lawful manner.
36. IMPROVEMENTS
All Improvements constructed or placed within the Premises by Lessee must, upon
completion, be free and clear of all liens, claims, or liability for labor or material.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 16
37. WASTE OR NUISANCE
Lessee shall not commit or permit the commission of any waste on the Premises.
Lessee shall not maintain, commit, or permit any nuisance as defined in Section 3479 of
the California Civil Code on the Premises. Lessee shall not use or permit the use of the
Premises for any unlawful purpose, including, but not limited to, any use that violates
City's charter or Municipal Code.
38. HAZARDOUS SUBSTANCES
38.1 From the Commencement Date and throughout the Term, Lessee will not
use, occupy, or permit any portion of the Premises to be used or occupied in violation of
any Hazardous Substance Laws. Notwithstanding any other provision in this Section 38
(HAZARDOUS SUBSTANCES), Lessee is not responsible/liable for any Hazardous
Substances that are brought on to the Premises, through migration or other means, by
third parties not associated with Lessee.
38.2 Notwithstanding any contrary provision of this Lease, and in addition to the
indemnification duties of Lessee set forth elsewhere in this Lease, Lessee indemnifies,
defends with counsel reasonably acceptable to Lessor, protects, and holds harmless
Lessor, its elected officials, officers, employees, agents, attorneys, volunteers and
representatives from and against any and all losses, fines, penalties, claims, demands,
obligations, actions, causes of action, suits, costs and expenses (including, without
limitation, attorneys' fees, disbursements and court costs), damages, judgments, or
liabilities, including, but not limited to, any repair, cleanup, detoxification, or preparation
and implementation of any remedial, response, closure or other plan of any kind or nature
which the Lessor, its officials, officers, employees, agents, attorneys, volunteers or
assigns may sustain or incur, or which may be imposed upon them, in connection with
any breach of Lessee's obligations or representations in this Lease or the use of the
Premises under this Lease, arising from or attributable to the Lessee Parties (defined
below) storage or deposit of Hazardous Substances in violation of Applicable Laws. This
Section is intended to operate as an agreement pursuant to Section 107(e) of CERCLA,
42 USC Section 9607(e), and California Health and Safety Code Section 25364, to insure,
protect, hold harmless, and indemnify Lessor for any claim pursuant to the Hazardous
Substance Laws or the common law.
38.3 Lessee does not, and will not, authorize any third party to use, generate,
manufacture, maintain, permit, store, or dispose of any Hazardous Substances in
violation of Applicable Laws on, under, about or within the Premises.
38.4 Upon expiration or earlier termination of this Lease, Lessee shall deliver
possession of the Premises in compliance with Hazardous Substance Laws subject to
the last sentence of Section 38.1 above.
38.5 If during the Term of this Lease, Lessee becomes aware of (i) any actual or
threatened release of any Hazardous Substances on, in, under, from, or about the
Premises in violation of Hazardous Substance Laws; or (ii) any inquiry, investigation,
HARBOR ISLAND COMMUNITY ASSOCIATION Page 17
proceeding, or claim by any government agency or other person regarding the presence
of any Hazardous Substances in violation of Hazardous Substance Laws on, in, under,
from or about the Premises, Lessee shall give Lessor written notice of the release or
inquiry within five (5) calendar days after Lessee becomes aware or first has reason to
believe there has been a release or inquiry and shall simultaneously furnish to Lessor
copies of any claims, notices of violation, reports, warning or other writings received by
Lessee that concern the release or inquiry.
38.6 If the presence of any Hazardous Substances brought onto the Premises
by Lessee or Lessee's employees, agents, sublessees, licensees, concessionaires,
contractors, or invitees ("Lessee Parties"), or generated by same during the Term of this
Lease, results in contamination of the Premises or adjacent properties or the Newport
Harbor in violation of Hazardous Substance Laws, Lessee shall promptly take all
necessary actions, at Lessee's sole expense, to remove or remediate such Hazardous
Substances in full compliance with Applicable Laws. Lessee shall provide notice to Lessor
prior to performing any removal or remedial action. Lessee shall not propose nor agree
to any covenant of use restriction as part of any removal or remediation required as a
result of this provision without Lessor's written consent. Lessee shall pay any costs
Lessor incurs in performing Lessee's obligation to clean-up contamination resulting from
Lessee's operations or use of the Premises. Any amounts not paid when due shall be
subject to late charges and delinquency rates as provided in Section 10 (CHARGE FOR
LATE PAYMENT).
(a) Should any clean-up of Hazardous Substances for which Lessee is
responsible not be completed prior to the expiration or sooner termination of the Lease,
including any extensions thereof, then Lessee shall transfer the amounts required to
complete clean-up into an escrow account, together with Lessor -approved instructions
for the disbursement of such amount in payment of the costs of any remaining clean-up
as it is completed, and (ii) if the nature of the contamination or clean-up required of Lessee
is of such a nature as to make the Premises untenable or unleaseable, then Lessee shall
be liable to Lessor as a holdover lessee until the clean-up has been sufficiently completed
to make the Premises suitable for lease to third parties. The estimated cost of the clean-
up shall require approval of the Lessor.
(b) If Lessor determines, in its reasonable discretion, that Lessee does not
have insurance or other financial resources sufficient to enable Lessee to fulfill its
obligations under this provision, whether or not accrued, liquidated, conditional, or
contingent, then Lessee shall, at the request of Lessor, procure and thereafter maintain
in full force and effect such environmental impairment liability and/or pollution liability
insurance policies and endorsements, or shall otherwise provide such collateral or
security reasonably acceptable to Lessor as is appropriate to assure that Lessee will be
able to perform its duties and obligations hereunder.
38.7 Lessee's obligations in this Section 38 (HAZARDOUS SUBSTANCES) shall
survive the expiration or earlier termination of this Lease.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 18
39. SURRENDER OF PREMISES
At the expiration or earlier Termination of this Lease, Lessee shall surrender to
Lessor the possession of the Premises. Lessee shall leave the surrendered Premises,
required personal property and fixtures, in good condition, reasonable wear and tear
excepted. All property that Lessee is not required to surrender, but that Lessee does
abandon shall, at City's election, become City's property.
40. TERMINATION
Lessor may terminate this Lease by giving Lessee thirty (30) calendar days written
notice. If Lessor terminates this Lease, Lessor may recover possession (which Lessee
shall surrender and vacate upon demand) and remove all persons, and property and
Improvements. Lessor shall be entitled to recover the following:
40.1 Unpaid Rent, Additional Rent or other charges which had been earned at
the time of termination;
40.2 The amount by which the unpaid Rent, Additional Rent or other charges
which would have been earned after termination until the time of award exceeds the
amount of such loss that Lessee proves could have been reasonably avoided;
40.3 The amount by which the unpaid Rent, Additional Rent or other charges for
the balance of the Term of this Lease after the time of award exceeds the amount of such
loss that Lessee proves could have been reasonably avoided;
40.4 Any other amount necessary to reasonably compensate Lessor for the
detriment proximately caused by Lessee's failure to perform its obligations under this
Lease;
40.5 At Lessor's election, such other amounts in addition to or in lieu of the
foregoing as may be permitted from time -to -time by applicable California law; and
40.6 Lessor shall also be entitled to an award of the costs and expenses
(including, without limitation, actual attorneys' fees and costs) incurred by Lessor in
maintaining or preserving the Premises after default, preparing the Premises for re -letting,
or repairing any damage caused by the act or omission of Lessee.
The amounts referred to in 40.1 and 40.2 above shall be computed by charging
interest at ten percent (10%) per annum from the dates such amounts accrued to Lessor.
The amount referred to in 40.3 above shall be computed by discounting such amount at
ten percent (10%) per annum.
41. COMPLIANCE WITH ALL LAWS
Lessee shall, at its sole cost and expense, comply with all statutes, ordinances,
regulations, requirements, directives, orders, mandates, conditions, or any other official
instructions or pronouncements of all governmental entities, including federal, state,
HARBOR ISLAND COMMUNITY ASSOCIATION Page 19
county or municipal, whether now in force or hereinafter enacted, including, without
limitation, those from the California State Lands Commission or its successor agency. In
addition, all work prepared by Lessee shall conform to applicable city, county, state and
federal laws, including the Beacon Bay Bill, rules, regulations and permit requirements
and be subject to approval of the City Manager or their designee.
42. WAIVERS
The waiver by either party of any breach or violation of any term, covenant or
condition of this Lease, or of any ordinance, law or regulation, shall not be deemed to be
a waiver of any other term, covenant, condition, ordinance, law or regulation, or of any
subsequent breach or violation of the same or other term, covenant, condition, ordinance,
law or regulation. The subsequent acceptance by either party of any fee, performance, or
other consideration which may become due or owing under this Lease, shall not be
deemed to be a waiver of any preceding breach or violation by the other party of any term,
condition, covenant of this Lease or any applicable law, ordinance or regulation.
43. SEVERABILITY
If any term or portion of this Lease is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of this Lease
shall continue in full force and effect.
44. APPLICABLE LAW
This Lease shall be construed in accordance with the laws of the State of California
in effect at the time of the execution of this Lease. Any action brought relating to this
Lease shall be adjudicated in a court of competent jurisdiction in the County of Orange.
45. ENTIRE AGREEMENT; AMENDMENTS
45.1 The terms and conditions of this Lease, all exhibits attached, and all
documents expressly incorporated by reference, represent the entire agreement of the
parties with respect to the subject matter of this Lease.
45.2 This Lease shall supersede any and all prior agreements, oral or written,
regarding the subject matter between Lessee and City.
45.3 No other agreement, promise or statement, written or oral, relating to the
subject matter of this Lease, shall be valid or binding, except by way of a written
amendment to this Lease.
45.4 The terms and conditions of this Lease shall not be altered or modified
except by a written amendment to this Lease signed by Lessee and City.
45.5 If any conflicts arise between the terms and conditions of this Lease, and
the terms and conditions of the attached exhibits or the documents expressly incorporated
by reference, the terms and conditions of this Lease shall control.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 20
45.6 Any obligation of the parties relating to monies owed, as well as those
provisions relating to limitations on liability and actions, shall survive termination or
expiration of this Lease.
45.7 Lessee has relied on its own inspection of the Premises and examination of
this Lease, the counsel of its own advisors, and the warranties, representations, and
covenants in this Lease. The failure or refusal of Lessee to inspect the Premises, to read
this Lease or other documents, or to obtain legal or other advice relevant to this
transaction constitutes a waiver of any objection, contention, or claim that might have
been based on such reading, inspection, or advice.
46. TIME IS OF THE ESSENCE
Time is of the essence for this Lease.
47. INTERPRETATION
The terms of this Lease shall be construed in accordance with the meaning of the
language used and shall not be construed for or against either party by reason of the
authorship of this Lease or any other rule of construction which might otherwise apply.
48. HEADINGS
The captions of the various sections of this Lease are for convenience and ease
of reference only and do not define, limit, augment, or describe the scope, content, or
intent of this Lease.
49. GENDER; NUMBER
The neuter gender includes the feminine and masculine, the masculine includes
the feminine and neuter, and the feminine includes the neuter, and each includes
corporation, partnership, or other legal entity whenever the context requires. The singular
number includes the plural whenever the context so requires.
50. EXHIBITS
All exhibits to which reference is made in this Lease are incorporated by reference.
Any reference to "this Lease" includes matters incorporated by reference.
51. MEMORANDUM OF LEASE AGREEMENT
A Memorandum of Lease Agreement, in a form and content similar to that
contained in Exhibit "F" shall be recorded by the parties promptly upon execution of this
Lease. Upon execution by both parties, the Memorandum of Lease Agreement shall be
recorded against the Premises in the office of the Orange County Clerk -Recorded, as
required by Government Code Section 37393.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 21
52. NO ATTORNEYS' FEES
The prevailing party in any action brought to enforce the terms and conditions of
this Lease, or arising out of the performance of this Lease, shall not be entitled to recover
its attorneys' fees.
53. NONDISCRIMINATION
Lessee, for itself and its successors, agrees that in the performance under this
Lease, Lessee shall not discriminate against any person because of the marital status or
ancestry of that person or any characteristic listed or defined in Government Code Section
11135.
54. NO THIRD -PARTY BENEFICIARIES
City (both as a Lessor and as the City of Newport Beach) and Lessee do not intend,
by any provision of this Lease, to create in any third party, any benefit or right owed by
one party, under the terms and conditions of this Lease, to the other party.
55. LAWS
It shall be the obligation of Lessee to comply with all laws, statutes, rules, and
regulations including, but not limited to, State of California labor laws, rules and
regulations and the parties agree that City shall not be liable for any violation by Lessee
(or Lessee's agent, sublessee or any party affiliated with Lessee) thereof.
56. NO DAMAGES
Lessee acknowledges that City would not enter into this Lease if it were to be liable
for damages (including, but not limited to, actual damages, economic damages,
consequential damages, lost profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill or loss of use) under, or relating to, this Lease or any of the
matters referred to in this Lease, including, without limitation, any and all plans, permits,
licenses or regulatory approvals, and CEQA documents. Accordingly, Lessee covenants
and agrees on behalf of itself and its successors and assigns, not to sue City (either in its
capacity as Lessor in this Lease or in its capacity as the City of Newport Beach) for
damages (including, but not limited to, actual damages, economic damages,
consequential damages, lost profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill or loss of use) or monetary relief for any breach of this Lease
by City or for any dispute, controversy, or issue between City and Lessee arising out of
or connected with this Lease or any of the matters referred to in this Lease, including,
without limitation, any and all plans, permits, licenses or regulatory approvals, CEQA
documents, or any future amendments or enactments thereto, the parties agreeing that
declaratory relief, injunctive relief, mandate and specific performance shall be Lessee's
sole and exclusive judicial remedies.
HARBOR ISLAND COMMUNITY ASSOCIATION Page 22
57. GOVERNMENT CLAIMS ACT
Lessee and City agree that in addition to any claims filing or notice requirements
in this Lease, Lessee shall file any claim that Lessee may have against City in strict
conformance with the Government Claims Act (Government Code sections 900 et seq.),
or any successor statute.
58. COUNTERPARTS
This Lease may be executed in two (2) or more counterparts, each of which shall
be deemed an original and all of which together shall constitute one (1) and the same
instrument.
[SIGNATURES ON NEXT PAGE]
HARBOR ISLAND COMMUNITY ASSOCIATION Page 23
IN WITNESS WHEREOF, the parties have caused this Lease to be executed on
the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date:
By: -For—
Aa n C. Harp 1f,
City Attorney
ATTEST:
Date:
By: -4�
Lena Shumway
City Clerk
Attachments: Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
LESSOR: CITY OF NEWPORT BEACH,
a California municipal corporation and
charter city
Date: 12 LLo I'lczS'
By: e-�;" ,
r K. Leung
ity Manager
LESSEE: HARBOR ISLAND
COMMUNITY ASSOCIATION, a
California nonprofit, common interest
development association corporation
Date:
Signed in Counterpart
By:
Heather Madden
President
Date:
BySigned in Counterpart
Michael Hayde
Treasurer
[END OF SIGNATURES]
Property and Premises Depiction
Proposed Improvements
Insurance Requirements
Labor and Materials Payment Bond
Faithful Performance Bond
Memorandum of Lease
HARBOR ISLAND COMMUNITY ASSOCIATION Page 24
IN WITNESS WHEREOF, the parties have caused this Lease to be executed on
the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEYS OFFICE
Date: 1T7 o / Z <5
By:
Aar n C. Harp
Cit Attorney
ATTEST:
Date:
By:
Lena Shumway
City Clerk
LESSOR: CITY OF NEWPORT BEACH,
a California municipal corporation and
charter city
Date:
By:
Grace K. Leung
City Manager
LESSEE: HARBOR ISLAND
COMMUNITY ASSOCIATION, a
California nonprofit, common interest
President
Date:____\L \"al— 1025:
By: —
Michael H de
Treasurer
[END OF SIGNATURES]
Attachments: Exhibit A - Property and Premises Depiction
Exhibit B - Proposed Improvements
Exhibit C - Insurance Requirements
Exhibit D - Labor and Materials Payment Bond
Exhibit E - Faithful Performance Bond
Exhibit F - Memorandum of Lease
HARBOR ISLAND COMMUNITY ASSOCIATION Page 24
EXHIBIT A
PROPERTY AND PREMISES DEPICTION
HARBOR ISLAND COMMUNITY ASSOCIATION Page A-1
EXHIBIT B
PROPOSEDIMPROVEMENTS
HARBOR ISLAND COMMUNITY ASSOCIATION Page B-1
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VI
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EXHIBIT C
INSURANCE REQUIREMENTS
1. Provisions of Insurance. Without limiting the indemnity provisions of this Lease, the
Lessee shall procure and maintain in full force and effect during the term of this
Agreement, the following policies of insurance. The Lessor reserves the right to modify
these requirements, including limits, based on the nature of the risk, prior experience,
insurer, coverage, or other special circumstances. If Lessee does not deliver copies
of acceptable insurance policies with Lessor incorporating such changes within thirty
days of receipt of such notice, this Lease shall be in default without further notice to
Lessee, and Lessor shall have the sole right to terminate this Lease in addition to
other remedies available. If the existing policies do not meet the insurance
requirements set forth herein, the Lessee agrees to amend, supplement, or endorse
the policies to do so.
2. Acceptable Insurers. Each such policy shall be from a company or companies with
a current A.M. Best's rating of no less than A-:VII and authorized to do business in the
State of California, or otherwise allowed to place insurance through surplus line
brokers under applicable provisions of the California Insurance Code or any federal
law. Any other rating must be approved in writing by the City.
3. Minimum Scope and Limit of Insurance
A. Commercial General Liability (CGL) which affords coverage at least as broad as
Insurance Services Office "occurrence" form CG 00 01, including products and
completed operations, property damage, bodily injury, and personal & advertising
injury with limits no less than three million dollars ($3,000,000) per occurrence and
five million dollars ($5,000,000) in the general aggregate.
B. Workers' Compensation Insurance Lessor shall maintain Workers' Compensation
Insurance, statutory limits, and Employer's Liability Insurance with limits of at least
one million dollars ($1,000,000) each accident for bodily injury by accident and
each employee for bodily injury by disease in accordance with the laws of the State
of California. In addition, Lessor shall require each subcontractor to similarly
maintain Workers' Compensation Insurance and Employer's Liability Insurance in
accordance with California law for all of the subcontractor's employees.
C. Pollution Legal Liability including onsite and offsite coverage for bodily injury
(including death and mental anguish), property damage, non -owned disposal site
liability, defense costs, cleanup costs, and pollution conditions that arise from or in
connection with the transportation (including loading and unloading) of any waste
or waste materials off or away from the premises. Coverage shall be provided for
both sudden and accidental and gradual and continuous pollution events with limits
no less than five million dollars ($5,000,000) each loss and five million dollars
HARBOR ISLAND COMMUNITY ASSOCIATION Page C-1
($5,000,000) in the aggregate. The policy shall not exclude any hazardous
materials for which there is exposure.
D. Property Insurance shall be maintained on an "All Risk" basis, including collapse,
equal to the full replacement cost of the property leased with no coinsurance
clause. Lessee shall be solely responsible for the payment of any deductible.
E. Builder's Risk Insurance during construction, reconstruction or alteration of any
Improvements on the premises against "all risk" of physical loss, including, without
limitation, the perils of flood, collapse and transit, with deductibles acceptable to
Lessor, covering the total cost of work performed, equipment, supplies and
material furnished on a replacement cost basis.
F. Excess/Umbrella Liability Policies If any excess or umbrella liability policies are
used to meet the limits of liability required by this Lease, then said policies shall be
"following form" of the underlying policy coverage, terms, conditions, and
provisions and shall meet all the insurance requirements stated in this Lease,
including, but not limited to the additional insured, primary & non-contributory and
waiver of subrogation insurance requirements stated herein. No insurance policies
or self-insurance maintained by the City, whether primary, reinsurance or excess,
and which also apply to a loss covered hereunder, shall be called upon to
contribute to a loss until Lessee's primary and excess/umbrella liability policies are
exhausted.
4. Endorsements
Insurance policies shall not be compliant if they include any limiting provision or
endorsement contrary to this Lease, including but not limited to restricting coverage
to the sole liability of Lessee or excluding contractual liability. The following
endorsements shall be provided to the City.
A. Commercial General Liability, and Pollution Legal Liability Policies:
Additional Insured: The Lessor, City of Newport Beach, its City Council,
boards and commissions, officers, agents, volunteers, employees and State of
California are to be covered as additional insureds for the liability and defense
of suits or claims arising out of the activities, work or operations performed by
or on behalf of the Lessee including materials, parts or equipment furnished in
connection with such work or operations on all liability policies, except
professional liability.
Commercial General Liability additional insured endorsements shall be at least
as broad as ISO Form(s) CG 20 10 11 85; or both CG 20 10 or CG 20 26, and
CG 20 37.
HARBOR ISLAND COMMUNITY ASSOCIATION Page C-2
2. Primary and Non -Contributory: This insurance is primary to and will not seek
contribution from any other insurance whether primary, excess, umbrella, or
contingent insurance, including deductible, or self-insurance available to the
Lessor, City of Newport Beach, its City Council, boards and commissions,
officers, agents, volunteers, employees and State of California for all liability
policies.
The Commercial General liability primary endorsements shall be at least as
broad as ISO CG 20 01 04 13.
B. Workers' Compensation:
1. Waiver of Subrogation: Any right of subrogation against the Lessor, City of
Newport Beach, its City Council, boards and commissions, officers, agents,
volunteers, and employees shall be waived. Subcontractors shall waive
C. Property Insurance:
1. Loss Payee: Losses payable under the policy shall be paid to the City as its
interests may appear.
2. Waiver of Subrogation: Any right of subrogation against the Lessor, City of
Newport Beach, its City Council, boards and commissions, officers, agents,
volunteers, and employees shall be waived.
G. Insurance Obligations of Lessee
The City requires and shall be entitled to Lessee's broader coverage and/or the higher
limits if Lessee maintains broader coverage and/or higher limits than the minimums
shown above. Any available insurance proceeds excess of the specified minimum
limits of insurance and coverage shall be available to the City. No representation is
made that the minimum insurance requirements of this Lease are sufficient to cover
the obligations of Lessee under this Lease. The procuring of such required policy or
policies of insurance shall not be construed to limit Lessee's liability hereunder nor to
fulfill the indemnification provisions and requirements of this Lease.
H. Notice Of Cancellation
Required insurance policies shall not be cancelled, or coverage reduced until thirty
(30) days written notice of cancellation has been served upon the City, except ten (10)
days shall be allowed for non-payment of premium.
HARBOR ISLAND COMMUNITY ASSOCIATION Page C-3
I. Waiver Of Subrogation
Required insurance policies shall not prohibit Lessee from waiving the right of
subrogation prior to a loss. The Lessee shall waive all rights of subrogation against
the indemnified parties and policies shall contain or be endorsed to contain such a
provision. This provision applies regardless of whether the City has received a waiver
of subrogation endorsement from the insurer.
J. Evidence Of Insurance
All policies, endorsements, certificates, and/or binders shall be subject to approval by
the City as to form and content. These requirements are subject to amendment or
waiver only if approved in writing by the City. The City reserves the right to require
complete, certified copies of all required insurance policies, including endorsements
required by these specifications, at any time. The certificates and endorsements for
each insurance policy shall be signed by a person authorized by that insurer to bind
coverage on its behalf. At least fifteen (15) days prior to the expiration of any such
policy, evidence of insurance showing that such insurance coverage has been
renewed or extended shall be filed with the City. If such coverage is cancelled or
reduced, Lessee shall, within ten (10) days after receipt of written notice of such
cancellation or reduction of coverage, file with the City evidence of insurance showing
that the required insurance has been reinstated or has been provided through another
insurance company or companies.
K. Self -Insured Retention
Self -insured retentions (SIR's) must be declared to and approved by the City. The
City may require Lessee to purchase coverage with a lower retention or provide proof
of ability to pay losses and related investigations, claim administration, and defense
expenses within the SIR. The policy language shall provide, or be endorsed to provide,
that the SIR may be satisfied by either the named insured or the City. Self -insured
retentions shall be the sole responsibility of Lessee, or subcontractor who procured
such insurance. The City may deduct from any amounts otherwise due Lessee to
fund the SIR. The policy must also provide that defense costs, including the allocated
loss adjustment expenses, will satisfy the SIR.
L. Contractual Liability
The coverage provided shall apply to the obligations assumed by Lessee under the
indemnity provisions of this Lease.
M. Failure To Maintain Coverage
The Lessee agrees to suspend and cease all operations hereunder during such time
as the required insurance coverage is not in effect and evidence of insurance has not
been furnished to the City. Should Lessee not provide City with proof of the required
HARBOR ISLAND COMMUNITY ASSOCIATION Page C-4
insurance coverage to the satisfaction of the City's risk manager, Lessee covenants
and agrees to pay to City on demand any and all sums expended by it in correcting
any such deficiency, together with an administrative fee, which shall be twenty percent
(20%) of City's total expenses incurred. Notwithstanding the foregoing sentence, if
within ten (10) days after loss of coverage, Lessee obtains and provides evidence of
required insurance coverage acceptable to City's Risk Manager, the Lessee may
continue operations. The insurance policy effective dates shall be retroactive to
ensure no gap in coverage.
N. Claims Made Policies
If coverage is written on a claims -made basis, the retroactive date of such insurance
and all subsequent insurance shall coincide or precede the effective date of Lessee's
initial Lease with the City and continuous coverage shall be maintained, or an
extended reporting period shall be exercised for a period of at least ten (10) years
from termination or expiration of this Lease.
O. Insurance For Subcontractors
Lessee shall be responsible for causing subcontractors to purchase the same types
and limits of insurance in compliance with the terms of this Lease, including adding
the City as an additional insured, providing primary and non-contributory coverage
and waiver of subrogation to the subcontractor's policies.
HARBOR ISLAND COMMUNITY ASSOCIATION Page C-5
EXHIBIT D
CITY OF NEWPORT BEACH
BOND NO.
LABOR AND MATERIALS PAYMENT BOND
WHEREAS, the City of Newport Beach, State of California, has entered into with
HARBOR ISLAND COMMUNITY ASSOCIATION, hereinafter designated as the
"Principal," a lease agreement for the use of the Property and Improvements at the
property located at and around Harbor Island in the City of Newport Beach, in strict
conformity with the Lease on file with the office of the City Clerk of the City of Newport
Beach, which is incorporated herein by this reference.
WHEREAS, Principal has executed or is about to execute the Lease and the terms
thereof require the furnishing of a bond, providing that if Principal or any of Principal's
subcontractors, shall fail to pay for any materials, provisions, or other supplies used in,
upon, for, or about the performance of the Work agreed to be done, or for any work or
labor done thereon of any kind, the Surety on this bond will pay the same to the extent
hereinafter set forth.
NOW, THEREFORE, We the undersigned Principal, and,
duly authorized to transact business under the laws of the State of California, as Surety,
(referred to herein as "Surety") are held and firmly bound unto the City of Newport Beach,
in the sum of Dollars ( ),
lawful money of the United States of America, said sum being equal to 100% of the total
amount payable for completion of the Improvements, and being over Twenty Five
Thousand Dollars and 00/100 ($25,000.00), payable by the City of Newport Beach under
the terms of the Lease; for which payment well and truly to be made, we bind ourselves,
our heirs, executors and administrators, successors, or assigns, jointly and severally,
firmly by these present.
THE CONDITION OF THIS OBLIGATION IS SUCH, that if the Principal or the
Principal's subcontractors, fail to pay for any materials, provisions, or other supplies,
implements or machinery used in, upon, for, or about the performance of the Work
contracted to be done, or for any other Work or labor thereon of any kind, or for amounts
due under the Unemployment Insurance Code with respect to such Work or labor, or for
any amounts required to be deducted, withheld and paid over to the Employment
Development Department from the wages of employees of the Principal and
subcontractors pursuant to Section 13020 of the Unemployment Insurance Code with
respect to such Work and labor, then the Surety will pay for the same, in an amount not
exceeding the sum specified in this Bond, and also, in case suit is brought to enforce the
obligations of this Bond, a reasonable attorneys' fee, to be fixed by the Court as required
by the provisions of Section 9554 of the Civil Code of the State of California.
The Bond shall inure to the benefit of any and all persons, companies, and
corporations entitled to file claims under Section 9100 of the California Civil Code so as
to give a right of action to them or their assigns in any suit brought upon this Bond, as
required by and in accordance with the provisions of Sections 9500 et seq. of the Civil
Code of the State of California.
HARBOR ISLAND COMMUNITY ASSOCIATION Page D-1
And Surety, for value received, hereby stipulates and agrees that no change,
extension of time, alterations or additions to the terms of the Lease or to the Work to be
performed thereunder shall in any wise affect its obligations on this Bond, and it does
hereby waive notice of any such change, extension of time, alterations or additions to the
terms of the Lease or to the Work or to the specifications.
In the event that any principal above named executed this Bond as an individual,
it is agreed that the death of any such principal shall not exonerate the Surety from its
obligations under this Bond.
IN WITNESS WHEREOF, this instrument has been duly executed by the above
named Principal and Surety, on the day of , 20
Name of Contractor (Principal)
Name of Surety
Address of Surety
Telephone
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date:
Aaron C. Harp
City Attorney
Authorized Signature/Title
Authorized Agent Signature
Print Name and Title
NOTARYACKNOWLEDGMENTS OF
CONTRACTOR AND SURETY MUST BE ATTACHED
HARBOR ISLAND COMMUNITY ASSOCIATION Page D-2
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of } ss.
On 20 before me, Notary
Public, personally appeared who proved to
me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal
Signature (seal)
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of } ss.
On 20 before me, Notary
Public, personally appeared proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal
Signature (seal)
HARBOR ISLAND COMMUNITY ASSOCIATION Page D-3
EXHIBIT E
CITY OF NEWPORT BEACH
BOND NO.
FAITHFUL PERFORMANCE BOND
KNOW ALL PERSONS BY THESE PRESENTS:
THAT WHEREAS,
HARBOR ISLAND COMMUNITY ASSOCIATION, (hereinafter referred to as "Tenant") is a tenant
of the City of Newport Beach, a California municipal corporation and charter city ("City"), and has
entered into a lease agreement for the use of the Property and Improvements at the property
located at and around Harbor Island in the City of Newport Beach, in strict conformity with the
lease agreement dated ("Lease").
WHEREAS, Tenant has awarded to _
the "Contractor") an agreement for the
, (hereinafter referred to as
(hereinafter referred to as the "Project").
WHEREAS, the work to be performed by the Contractor is more particularly set forth in the
Contract Documents for the Project dated , (hereinafter referred to as
"Contract Documents"), the terms and conditions of which are expressly incorporated herein by
reference; and
WHEREAS, the Contractor is required by said Contract Documents and the Lease to furnish a
bond for the faithful performance of said Contract Documents for the benefit of City and Tenant.
NOW, THEREFORE, we, the undersigned Contractor and
as Surety, a corporation organized
and duly authorized to transact business under the laws of the State of California, are held and
firmly bound unto the City and the in the sum of DOLLARS,
($ ), said sum being not less than one hundred percent (100%) of the total amount
of the Contract, for which amount well and truly to be made, we bind ourselves, our heirs,
executors and administrators, successors and assigns, jointly and severally, firmly by these
presents.
THE CONDITION OF THIS OBLIGATION IS SUCH, that, if the Contractor, their or its heirs,
executors, administrators, successors or assigns, shall in all things stand to and abide by, and
well and truly keep and perform the covenants, conditions and agreements in the Contract
Documents and any alteration thereof made as therein provided, on its part, to be kept and
performed at the time and in the manner therein specified, and in all respects according to their
intent and meaning; and shall faithfully fulfill all obligations including the one (1) year guarantee
of all materials and workmanship; and shall indemnify and save harmless the City, the Tenant,
and their respective officials, officers, employees, and authorized volunteers, as stipulated in said
Contract Documents, then this obligation shall become null and void; otherwise it shall be and
remain in full force and effect.
As a part of the obligation secured hereby and in addition to the face amount specified therefore,
there shall be included costs and reasonable expenses and fees including reasonable attorney's
fees, incurred by City and the Tenant in enforcing such obligation.
As a condition precedent to the satisfactory completion of the Contract Documents, unless
otherwise provided for in the Contract Documents, the above obligation shall hold good for a
HARBOR ISLAND COMMUNITY ASSOCIATION Page E-1
period of one (1) year after the acceptance of the work by City, during which time if Contractor
shall fail to make full, complete, and satisfactory repair and replacements and totally protect the
City and the Tenant from loss or damage resulting from or caused by defective materials or faulty
workmanship. The obligations of Surety hereunder shall continue so long as any obligation of
Contractor remains. Nothing herein shall limit the City's or Tenant's rights or the Contractor or
Surety's obligations under the Contract, law or equity, including, but not limited to, California Code
of Civil Procedure Section 337.15.
Whenever Contractor shall be, and is declared by the City or the Tenant to be, in default under
the Contract Documents, the Surety shall remedy the default pursuant to the Contract Documents,
or shall promptly, at the City's and Tenant's option:
Take over and complete the Project in accordance with all terms and conditions in
the Contract Documents; or
Obtain a bid or bids for completing the Project in accordance with all terms and
conditions in the Contract Documents and upon determination by Surety of the
lowest responsive and responsible bidder, arrange for a Contract between such
bidder, the Surety and the City, and make available as work progresses sufficient
funds to pay the cost of completion of the Project, less the balance of the contract
price, including other costs and damages for which Surety may be liable. The term
"balance of the contract price" as used in this paragraph shall mean the total
amount payable to Contractor by the City under the Contract and any modification
thereto, less any amount previously paid by the City to the Contractor and any
other set offs pursuant to the Contract Documents.
iii. Permit the City to complete the Project in any manner consistent with California
law and make available as work progresses sufficient funds to pay the cost of
completion of the Project, less the balance of the contract price, ludhg-otheT—
costs and damages for which Surety may be liable. The term "balance of the
contract price" as used in this paragraph shall mean the total amount payable to
Contractor by the City under the Contract and any modification thereto, less any
amount previously paid by the City to the Contractor and any other set offs
pursuant to the Contract Documents.
Surety expressly agrees that the City and the Tenant may reject any contractor or subcontractor
which may be proposed by Surety in fulfillment of its obligations in the event of default by the
Contractor.
Surety shall not utilize Contractor in completing the Project nor shall Surety accept a bid from
Contractor for completion of the Project if the City, when declaring the Contractor in default,
notifies Surety of the City's objection to Contractor's further participation in the completion of the
Project.
The Surety, for value received, hereby stipulates and agrees that no change, extension of time,
alteration or addition to the terms of the Contract Documents or to the Project to be performed
thereunder shall in any way affect its obligations on this bond, and it does hereby waive notice of
any such change, extension of time, alteration or addition to the terms of the Contract Documents
or to the Project.
[Signatures on the following page]
HARBOR ISLAND COMMUNITY ASSOCIATION Page E-2
Name of Contractor (Principal)
Name of Surety
Address of Surety
Telephone
(Attach Attorney -in -Fact Certificate)
The rate of premium on this bond is
charges is $
(The above must be filled in by corporate attorney.)
Any claims under this bond may be addressed to:
(Name and Address of Surety or
Agent for Service in California)
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date:
0
Aaron C. Harp
City Attorney
Authorized Signature/Title
Attorney -in -Fact
Print Name and Title
(Corporate Seal)
per thousand. The total amount of premium
NOTARYACKNOWLEDGMENTS OF
CONTRACTOR AND SURETY MUST BE ATTACHED
HARBOR ISLAND COMMUNITY ASSOCIATION Page E-3
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of } ss
On , 20 before me, , Notary
Public, personally appeared who proved to
me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Signature (seal)
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of } ss
On , 20 before me, , Notary
Public, personally appeared proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal
Signature (seal)
HARBOR ISLAND COMMUNITY ASSOCIATION Page E-4
EXHIBIT F
MEMORANDUM OF LEASE
HARBOR ISLAND COMMUNITY ASSOCIATION Page F-1
RECORDING REQUESTED AND
WHEN RECORDED RETURN TO:
City Clerk's Office
City of Newport Beach
100 Civic Center Drive
Newport Beach, CA 92660
[Exempt from Recordation Fee - Govt. Code §§ 6103 & 27383]
MEMORANDUM OF LEASE AGREEMENT
This Memorandum of Lease Agreement ("Memorandum") is dated ,
202, and is made between CITY OF NEWPORT BEACH a California municipal
corporation and charter city ("Lessor" or "City") and HARBOR ISLAND COMMUNITY
ASSOCIATION, a California nonprofit, common interest development association
corporation ("Lessee"), concerning the premises as depicted in Attachment 1," attached
hereto and by this reference made a part hereof ("Premises").
For good and adequate consideration, Lessor leases the Premises to Lessee, and Lessee
hires them from Lessor, for the term and on the provisions contained in the Lease
Agreement dated , 202_ ("Lease"), including without limitation
provisions prohibiting assignment, subleasing, and encumbering said leasehold without
the express written consent of Lessor in each instance, all as more specifically set forth
in said Lease, which said Lease is incorporated in this Memorandum by this reference.
The term is (_) years, beginning , 202_, and
ending , 20_, and (_) additional successive "Option Terms"
of (_) years, on the same terms and conditions contained in the Lease as it may
be amended from time to time.
This Memorandum is not a complete summary of the Lease. Provisions in this
Memorandum shall not be used in interpreting the Lease's provisions. In the event of
conflict between this Memorandum and other parts of the Lease, the other parts shall
control. Execution hereof constitutes execution of the Lease itself.
Assessor's Parcel Number:
[Signatures on the next page]
HARBOR ISLAND COMMUNITY ASSOCIATION Page F-2
LESSOR:
LESSEE:
City of Newport Beach, HARBOR ISLAND COMMUNITY
a California municipal corporation and ASSOCIATION, a California nonprofit,
charter city common interest development association
corporation
Grace K. Leung
City Manager
ATTEST:
Lena Shumway
City Clerk
APPROVED AS TO FORM:
Aaron C. Harp
City Attorney
Attachments
Heather Madden
President
Michael Hayde
Treasurer
Lessee must sign in the presence of a notary public
Attachment 1 — Premises Depiction
HARBOR ISLAND COMMUNITY ASSOCIATION Page F-3
ATTACHMENT 1
PREMISES DEPICTION
HARBOR ISLAND COMMUNITY ASSOCIATION Page F-4
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not
the truthfulness, accuracy, or validity of that document.
State of California
County of } ss.
On , 20 before me,
Notary Public, personally appeared who
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signatures(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Signature
ACKNOWLEDGMENT
A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the
document to which this certificate is attached, and not
the truthfulness, accuracy, or validity of that document.
State of California
County of } ss.
(seal)
On , 20 before me,
Notary Public, personally appeared
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signatures(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(seal)
HARBOR ISLAND COMMUNITY ASSOCIATION Page F-5