HomeMy WebLinkAboutC-8406-1 - Riverside Drive, 20302 - Lease Agreementl
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O� FIRST AMENDMENT TO LEASE AGREEMENT
BETWEEN THE CITY OF NEWPORT BEACH,
20302 RIVERSIDE DRIVE, LLC, AND HOME FREE ANIMAL RESCUE &
SANCTUARY
This FIRST AMENDMENT TO LEASE AGREEMENT ("First Amendment") is made
and entered into as of this 15th day of November, 2021, ("Effective Date"), by and between
the City of Newport Beach, a California municipal corporation and charter city ("City"),
20302 Riverside Drive, LLC, a California limited liability company ("Lessor"), and Home
Free Animal Rescue & Sanctuary, a California corporation ("Home Free"). City, Lessor,
and Home Free may be individually referred to herein as a "Party," and collectively
referred to herein as the "Parties."
RECITALS
A. On March 1, 2017, the City entered into that certain Lease Agreement with Lessor
and Home Free ("Lease Agreement"), concerning that property located at 20302
Riverside Drive, Newport Beach, California 92660, Assessor's Parcel Number
439-251-05 ("Property"), whose Premises are as defined and depicted in the Lease
Agreement;
B. The Parties entered the Lease Agreement to formalize an agreement for shared
use of the Property and for City to operate an animal shelter at the Premises, as
further described in the Lease Agreement; and
C. City, Lessor, and Home Free now desire to amend the Lease Agreement to extend
the term of the Lease Agreement and rent therefor, as provided below.
AGREEMENT
NOW, THEREFORE, in consideration of the benefits set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties mutually agree as follows -
1 .
ollows:
1. An additional paragraph to Section 3.2 (Option to Extend) of the Lease
Agreement is hereby added to state the following:
"Commencing on the Expiration of the Option Term ending
February 28, 2022, the Term of this Agreement shall extend
automatically by an additional Option Term to February 28,
2023, unless the City provides Lessor written notice of its
intention to terminate at least sixty (60) calendar days prior."
2. An additional paragraph to Section 4.1 (Rent) of the Lease Agreement is
hereby added to state the following:
"Rent for the third Option Term (March 1, 2022 to February
28, 2023), shall be established at Seventy Nine Thousand
Two Hundred Dollars and 00/100 ($79,200.00) per year.
Rent shall be paid, in advance, in equal monthly installments
on the first day of each month (e.g., Six Thousand Six
Hundred Dollars and 00/100 ($6,600.00) per month). Rent
for any partial month shall be prorated in accordance with the
actual number of days in that month and shall be due on the
first day of that month that falls within the Term."
3. Except as expressly modified herein, all other provisions, terms, covenants
and conditions of the Lease Agreement shall remain unchanged and in full force and
effect.
[SIGNATURES ON NEXT PAGE]
First Amendment to Lease Agreement Page 2
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the dates written below.
APPROVED AS TO FORM: CITY: CITY OF NEWPORT BEACH,
CITY ATTORNEY'S OFFICE a California municipal corporation and
charter city
Date: "�/�21 Date: JAN 2 4 2022
B : By:
Aa C. HarV (A-wI�Alu Grac Leung
City Attorney City Wranager
ATTEST-
Date:
���, �m,,�a
Date: /. 'C'
By: aftj!?� —
Leilani I. Brown
City Clerk
LESSOR: 20302 RIVERSIDE DRIVE,
LLC, a California limited liability company
Date:
By: Signed in Counterpart
Kathryn L. Leonard
Managing Member
HOME FREE: HOME FREE ANIMAL
RESCUE & SANCTUARY, a California
corporation
Date:
Signed in Counterpart
By:
Marlene L. Brown
Vice President / Chief Financial Officer
Date:
By: Signed in Counterpart
Virginia Soto Martinez
Secretary
[END OF SIGNATURES]
First Amendment to Lease Agreement Page 3
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the dates written below.
APPROVED AS TO FORM: CITY: CITY OF NEWPORT BEACH,
CITY ATTORNEY'S OFFICE a California municipal corporation and
charter city
Date: Date:
/� By _.r - _... By
'tom o Harp _ uM�•t�ahi Grace K. Leung
City ttorney City Manager
ATTEST: LESSOR: 20302 RIVERSIDE DRIVE,
Date: - _ LLC, a Calif rnia limited liability company
Date: i 111 11 P��;1i
By - --- --- --- BY:VttrjA�4r
-
Leilani I. Brown Kathryn L. Le(Ypard
City Clerk Managing Member
HOME FREE: HOME FREE ANIMAL
RESCUE & SANCTUARY, a California
corporation
Date: )y OV . 1 c1 1 -Z- 0 Z 1
By:.
Marlene L. Brown
Vice President / Chief Financial Officer
Dater
Virgi Soto Martinez
Secretary
[END OF SIGNATURES]
First Amendment to Lease Agreement Page 3
Cco
LEASE AGREEMENT
BETWEEN THE CITY OF NEWPORT BEACH,
20302 RIVERSIDE DRIVE, LLC, AND HOME FREE ANIMAL RESCUE &
SANCTUARY
This Lease Agreement ("Agreement") is made and entered into as of the 1st day
of March, 2017 ("Effective Date"), by and between the City of Newport Beach, a
California municipal corporation and charter city ("City' or "Lessee"), 20302 Riverside
Drive, LLC, a California limited liability company ("Lessor"), and Home Free Animal
Rescue & Sanctuary, a California corporation ("Home Free'). City, Lessor, and Home
Free are sometimes individually referred to as "Party" and collectively as "Parties"
herein.
RECITALS
A. City is a municipal corporation duly organized and validly existing under
the laws of the State of California with the power to carry on its business as it is now
being conducted under the statutes of the State of California and the Charter of City.
B. Lessor is the owner of the property, structures, and improvements located
at 20302 Riverside Drive, Newport Beach, California, Assessor's Parcel Number 439-
251-05 ("Property"). The Property includes an existing 1,432 square foot, two-story
single-family residence with, on-site parking for four (4) vehicles, kennel building with
eleven (11) indoor and outdoor dog runs, eight (8) outdoor dog runs, and an
approximately six hundred (600) square foot structure housing office space, twenty-
seven (27) cat cages, storage and wash room ("Premises"). The Propery is legally
described and depicted on Exhibit "A" attached hereto and incorporated herein by this
reference. The Premises is depicted on Exhibit "B" attached hereto and incorporated
herein by reference.
C. In accordance with Chapter 7.16 of the Newport Beach Municipal Code,
all dogs, fowl or other animals picked up running at large on the streets, alleys, parks,
beaches or other public places in the City may be impounded.
D. When the City impounds animals, the animals are transferred to an animal
care shelter for retention. The City does not currently own or operate any facilities
suitable for receiving, sheltering, or caring for dogs, cats, fowl, or other animals that may
be impounded.
E. The Property is currently operated by Home Free, run by Kathy and Roy
Leonard, as a rescue facility for animals that have not been successfully placed by area
shelters and rescue facilities. In consideration of Home Free's mission to rescue
animals, background, experience, skill and ability, certification and knowledge, the City
contracted Home Free to provide animal care services via that Memorandum of
Understanding Among The City of Newport Beach and Home Free Animal Sanctuary for
Animal Care Services, Contract No. C-6373, dated November 24, 2015 ("Memorandum
of Understanding"). The Parties now desire to enter into this Agreement to formalize an
agreement for shared use of the Property, for the City to operate an animal shelter at
the Premises.
F. The City proposes to lease a portion of the Premises including two (2)
downstairs bedrooms in the existing 1,432 square foot, two-story single-family
residence, three (3) on-site parking spaces, kennel building with eleven (11) indoor and
outdoor dog runs, eight (8) outdoor dog runs, and the approximately six hundred (600)
square foot structure housing office space, twenty-seven (27) cat cages, storage, and
wash room to provide facilities for receiving, sheltering, and caring for dogs, cats, fowl,
and other animals that may be picked -up running at -large on City streets.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the Parties hereby agree as follows:
1. DEFINITIONS
1.1 General Definitions. As used in this Agreement, the following words and
phrases shall have the following meanings:
(a) Alteration — any improvements, additions, alterations, changes, or
modifications of the Property made by Lessor, or City, its employees, agents,
contractors, and subcontractors.
(b) City Administrator — this Agreement shall be administered by the
City's Police Department. The Traffic Services Lieutenant or his or her designee, shall
be the City Administrator and shall have the authority to act for City under this
Agreement. The City Administrator or his/her authorized representative shall represent
City in all matters pertaining to this Agreement for the purpose of providing an animal
shelter for the City.
(c) Commencement Date — March 1, 2017.
(d) Expiration — the lapse of the time specified as the Term of this
Agreement, including any extension of the Term resulting from the exercise of an option
to extend.
(e) Law(s — any judicial decision, statute, constitution, ordinance,
resolution, regulation, rule, administrative order, or other requirement of any municipal,
county, state, federal, or other government agency or authority having jurisdiction over
the Parties hereto or the Property.
(f) Maintenance or Maintain — repairs, replacement, maintenance,
striping, repainting, and cleaning.
(g) Person — one (1) or more natural persons, or legal entities,
including, without limitation, partnerships, corporations, trusts, estates, associations, or
a combination of natural persons and legal entities.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 2
(h) Provision — any term, covenant, condition, or clause in this
Agreement that defines, establishes, or limits the performance required or permitted by
either Party.
(i) Rent — includes rent, taxes, and other similar charges payable by
City under the provisions of this Agreement.
(j) Successor — assignee, transferee, personal representative, heir, or
other Person succeeding lawfully, and pursuant to the provisions of this Agreement, to
the rights or obligations of either Party.
(k) Term — the Initial Term, as the same may be extended by the
Option Term (as defined in Section 3.2) pursuant to the provisions of this Agreement.
(1) Termination — the termination of this Agreement, for any reason,
prior to Expiration.
1.2 Other Definitions. — The following additional terms are defined in the
following sections of this Agreement:
(a)
Rent
§4
(b)
Hazardous Materials
§16
(c)
Indemnified Parties
§10.1
(d)
Option Term(s)
§3.2
(e)
Property
Recitals, §13
(f)
Initial Term
§3.1
2. PROPERTY
Lessor and Home Free agree to grant to City a right to maintain, use and operate
the Premises, which includes two (2) downstairs bedrooms in the existing 1,432 square
foot, two-story single-family residence, three (3) on-site parking spaces, kennel building
with eleven (11) indoor and outdoor dog runs, eight (8) outdoor dog runs, and the
approximately six hundred (600) square foot structure housing office space, twenty-
seven (27) cat cages, storage and wash room on the Property. Therefore, subject to
the terms and conditions set forth herein, Lessor hereby leases to City and City agrees
to lease the Premises in an "as is" condition, with the exception of certain improvements
that Lessor shall make to the Premises at Lessor's sole cost and expense ("Lessor
Improvements"). The Lessor Improvements shall include:
(a) Construction of a partition wall to separate the two (2) downstairs
bedrooms from the remainder of the residence. The two (2) bedrooms are
to be used as offices by City. Any further additions or improvements at the
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 3
Premises, made by City, shall be at sole cost and expense of City.
City agrees that no representations with respect to the condition or improvements
of the Property or the Premises have been made by Lessor except as specifically set
forth in this Agreement.
3. TERM
3.1 Term of Agreement. The initial term of this Agreement shall be three (3)
years from the Commencement Date ("Initial Term"), unless terminated sooner as
provided in this Agreement, or extended as provided in Section 3.2.
3.2 Option to Extend. Provided City is not then in default under this
Agreement beyond applicable notice and cure periods, City may extend the term of this
Agreement for two (2) additional successive terms of one (1) year ("Option Term")
commencing on Expiration of the Initial Term or an Option Term, on the same terms and
conditions as contained in this Agreement. The Term and Option Term(s) shall extend
automatically each year unless the City provides Lessor written notice of its intention to
terminate the Term or Option Term at least thirty (30) calendar days prior to Expiration
of the Initial Term or an Option Term.
3.3 Purchase Option. Provided City is not in default under this Agreement
beyond applicable notice and cure periods, Lessor shall, in good faith and upon the
same material terms as would be offered to other private parties, grant City a continuing
First Right of Refusal ("FROR") to purchase the Property at fair market value, should
Lessor elect to transfer the Property. For purposes of this Agreement, "transfer" and
similar terms mean and include, without limitation, a sale or other transfer of all or any
part of the Property, or interest therein, either alone, or as part of a larger sale,
provided, however, that "transfer" shall not include the granting of an easement or
similar right on a portion of the Property that would not materially interfere, disrupt, or
frustrate City's contemplated use pursuant to this Agreement.
3.4 Hold Over. Should City, with Lessor's consent, hold over and continue in
possession of the Property after Expiration of the Term or any Option Term, City's
continued occupancy of the Property shall be considered a month-to-month tenancy
subject to one hundred twenty (120) calendar days written notice by either Party to
terminate, and subject to all the terms and conditions of this Agreement, except the
provisions of Sections 3.1 and 3.2.
4. RENT
4.1 Rent. City shall commence payment of rent upon the Commencement
Date. The "Rent," which includes the use of the Premises, shall be established at Sixty
Six Thousand Dollars and 00/100 ($66,000.00) per year. Rent shall be paid, in
advance, in equal monthly installments on the first day of each month (e.g., Five
Thousand Five Hundred Dollars and 00/100 ($5,500.00) per month). Rent for any
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 4
partial month shall be prorated in accordance with the actual number of days in that
month and shall be due on the first day of that month that falls within the Term.
Rent due hereunder will be subject to the rent adjustment provisions of Section
4.2 below. City shall send Rent to the mailing address provided in Section 4.3.
4.2 Rent Adjustments. Rent may be adjusted on the 2nd anniversary of the
Commencement Date and then on the 1st of each Lease Year thereafter (the term
"Lease Year' as used herein refers to successive twelve (12) month periods,
commencing with the Commencement Date of this Agreement) to reflect 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 — Orange County -
Riverside 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 Commencement Date. The
initial Base Period Index shall be compared with the Index for the same calendar month
for each subsequent Lease 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 Lease Year shall be
increased by the amount of such percentage change. 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. Lessor shall notify
City in writing of any annual adjustment pursuant to this Section 4.2 at least thirty (30)
business days prior to the effective date of such adjustment.
4.3 Payment Location. All payments of Rent shall be made in lawful money of
the United States of America and shall be paid to Lessor by United States' mail, or
overnight mail service, at the Lessor's office located at 20302 Riverside Drive, Newport
Beach, California 92660, or to such other address as Lessor may from time to time
designate in writing to City.
5. BUSINESS PURPOSES AND USE OF PROPERTY
5.1 Business Purposes. The Property is to be used by City for the operation
of an animal shelter and for no other use. The City shall be responsible for obtaining all
required permits and licenses for the City's operation of the animal shelter and
complying with all applicable conditions imposed by such permits and licenses. City
shall have use of the Property throughout the Term, subject to Home Free's shared use
rights set forth in Section 5.3
5.2 Operation of Property. City shall operate and manage the Premises in a
manner comparable to other animal shelters providing similar uses and services.
Except with respect to any entry onto and/or use of the Property by City, its employees,
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 5
contractors, agents, customers, invitees, elected officials, and volunteers, Lessor's
Manager, Virginia Soto Martinez, is responsible for the security of the Property and
must close and secure all points of access each night. City use of the Property shall
comply with all use permits, conditions, laws, and terms of this Agreement.
5.3 Shared Use of Property. Lessor and Home Free shall continue to use
portions of the Property, including exclusive use of all areas of the first and second floor
of the single-family residence not leased to City, described herein as: one (1) parking
space, the shared use of two (2) indoor/outdoor kennels, and the office building. Lessor
and Lessee shall agree on the person or persons who will lease the portion of the house
(Lessor's Manager) listed in this paragraph. This person shall have the right to care for
all animals on the facility, if necessary, both those animals belonging to the City and
those animals belonging to Home Free Animal Rescue, after regular business hours
and if no other City staff are available. Shared use of the Property is further described
below, and may be amended in writing from time to time by mutual agreement of
Lessor, Home Free, and City, each acting reasonably and in good faith.
5.3.1 Lessor currently has eight (8) dogs on the Premises. After adoption
of three (3) dogs, the Lessor shall be permitted to keep up to five (5) dogs
on the Premises. These five (5) dogs shall be placed in kennels as
needed and their sheltering shall be in the best interests of both Parties,
with at least some of Lessor's dogs allowed in the front area of the
Property to provide the public with an opportunity to adopt Home Free
animals as well as those held by the City, including two (2) of the four (4)
indoor/outdoor kennels currently designated as kennels nine (9) through
twelve (12). These five (5) dogs shall be cared for by staff designated by
Home Free and accepted by Lessee as per Section 5.3.4 below, including
feeding, watering, cleaning of kennels, unless otherwise arranged with
City on a case by case basis.
5.3.2 Lessor shall be permitted to keep enough of the existing office
space, to provide space for a desk, chair, and wall space.
5.3.3 Lessor shall be allocated a sufficient amount of storage space for
supplies including but not limited to food, bowls, leashes, cleaning
supplies, towels, bedding, etc., either in a mutually agreeable spot, or in a
secured storage area separate from Lessee.
5.3.4 If there are any personnel issues with either Lessor's employees or
volunteers, or with City's employees or volunteers that either Party
believes are in conflict with the operation of either the City's animal shelter
or with Home Free, those issues shall be brought to the attention of the
other Party. At that time, the Parties shall work in good faith to resolve the
issue satisfactorily. If a resolution cannot be reached to the satisfaction of
either Party, the City shall have the final determination as to disposition
given the higher public responsibility of care and performance standards
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 6
to maintain a professional working environment. Given that the City's
animal shelter houses animals subject to potential evidentiary
(civil/criminal) chain of custody, are property of others, and that the facility
is a City of Newport Beach Police Department annex, the facility must
maintain standards of access and security as well as maintain City
personnel policies. To this end, City requires the need to approve of any
employee or volunteer of Home Free prior to access to work at the facility.
This approval process may require the completion of a volunteer
background check.
5.3.5 The City volunteers shall walk all Home Free dogs unless the City
determines that the animal could be a hazard to the volunteer or
employee. The City shall discuss with Home Free and Home Free will
make arrangements to walk the animal, pursuant to Home Free's policies
and procedures.
5.3.6 Lessor agrees, at Lessor's expense, to place drywall or other
barrier to block off the two (2) downstairs bedrooms to be used by City
from the rest of the Premises. Any other additions, improvements, etc. to
these two (2) downstairs bedrooms made at the request of City shall be at
the sole expense of City.
5.3.7 Lessor shall not permit any use of the Property pursuant to this
Agreement: (i) other than strictly during the times set forth herein and as
may be amended from time to time, and/or (ii) in any manner that results
in unreasonable wear and tear and/or requires janitorial or other
maintenance work in excess of the type and amount of such work that
would be reasonable and customary for City's contemplated use unless
otherwise agreed upon by City and Lessor.
5.3.8 The Parties shall cooperate with one another, act reasonably, in
good faith, and communicate regularly and proactively. The Parties shall
not assign its shared use rights under this Agreement to a third party,
without the written consent of the other Parties.
5.4 Responsibility of Lessor's Manager. City and Lessor shall agree on the
tenant(s) who will live on the Property (Lessor's Manager). Lessor's
Manager shall:
5.4.1 Provide an on-site presence during closed hours and report any
animal medical emergencies or security issues to City Police
Department dispatch or City's Animal Control Supervisor.
5.4.2 Maintain the front of the Property in a clean condition with a
professional appearance which reflects the quality standards of the
City of Newport Beach.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 7
5.4.3 Ensure that gates, doors, and other access points are locked for
the security of the animals in the care of the City
5.5 Prohibited Uses. Lessor shall not use the Property for any purpose other
than an animal shelter and single-family residence. The Property is for the exclusive use
of the Lessor, Home Free, and City's employees, contractors, agents, volunteers,
guests and invitees. Use of the Property for a temporary construction yard or any
construction staging is strictly prohibited, except in connection with the construction of
any Lessor or tenant improvements in accordance with Section 8. Lessor shall not hold
the Property open for use by the general public. Lessor shall not use or permit the use
of the Property in any manner that: (a) creates a nuisance; or (b) violates any Law.
5.6 Signage. City may install permanent or temporary signage upon the
Property in such locations as City desires, and City shall ensure that any identifying and
directional signage for shared use of the Property for Home Free programs is
maintained. City must obtain necessary approvals and permits for signage, which must
comply with applicable City regulations and conditions. All signage placed by City on, in
or about the Property shall remain the property of City and shall be removed by City
upon termination or expiration of this Agreement at City's expense, and any damage
caused by removal shall be repaired at City's expense.
5.7 Parking. The Property contains four (4) off-street parking spaces, of which
three (3) non -designated spaces shall be leased by City pursuant to this Agreement.
The parking spaces shall be available for use by City at all times, regardless of the
hours of operation of the City shelter. One (1) parking space shall be retained for use by
Lessor and Home Free. Non-compliance with these conditions shall constitute a default
under this Agreement, and subject to the provisions of Section 14, City shall have the
rights to terminate this Agreement.
5.8 Personnel. City shall be responsible for hiring the necessary City
personnel to conduct the daily operation of City animal shelter. City shall comply with
all applicable federal, state, and local Laws related to wages, Social Security,
nondiscrimination, Americans with Disabilities Act, unemployment compensation, and
workers' compensation.
5.9 Independent Contractor. It is understood that Lessor and Home Free are
independent contractors and are not an agents or employees of the City. The manner
and means of operating the City shelter at the Premises are under the control of City,
except to the extent they are limited by statute, rule or regulation and/or the expressed
terms of this Agreement. No civil service status or other right of employment shall
accrue to Lessor or Home Free's employees, agents, or volunteers. Nothing in this
Agreement shall be deemed to constitute approval for Lessor or Home Free or any of
Lessor or Home Free's employees, agents, or volunteers to be the agents or employees
of City. City acknowledges that is has no interest in the business of Lessor or Home
Free, and Lessor and Home Free acknowledge they have no interest in the business of
the City.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 8
6. TAXES, LICENSES AND OTHER OBLIGATIONS
6.1 Payment of Taxes. Lessor shall pay directly to the appropriate taxing
authorities all taxes applicable to this Agreement, fixtures and Lessor's personal
property on the Property, that are levied or assessed against Lessor during the Term.
Taxes shall be paid before delinquency and before any fine, interest, or penalty is due
or imposed by operation of law. Lessor shall, upon request, promptly furnish to the City
reasonably satisfactory evidence of payment. Lessor shall pay, before delinquency all
taxes, assessments, license fees and other charges ("Taxes') that are levied or
assessed against Lessor's interest in the Property or any personal property installed on
the Property.
6.2 Payment of Obligations. Lessor and City shall promptly pay, when due,
any and all bills, debts, liabilities and obligations incurred by the respective Party in
connection with their pro rata share of the occupation and/or use of the Property.
6.3 Challenge to Taxes. Lessor shall have the right in good faith, at its sole
cost and expense, to contest the amount or legality of any Taxes on or attributable to
this Agreement, the Property, Lessor's personal property, or City's occupation and/or
use of the Property, including the right to apply for reduction. If Lessor seeks a
reduction or contests such Taxes, Lessor's failure to pay the Taxes shall not constitute
a default under this Agreement as long as Lessor complies with the provisions of this
Section. City shall not be required to join in any proceeding or contest brought by
Lessor unless the provisions of any Law require that the proceeding or contest be
brought by or in the name of City. In that case, City shall join in the proceeding or
contest or permit it to be brought in City's name as long as City is not required to bear
any cost. If requested by Lessor, City shall execute any instrument or document
necessary or advisable in connection with the proceeding or contest. Lessor, on final
determination of the proceeding or contest, shall immediately pay or discharge any
decision or judgment rendered, together with all related costs, charges, interest and
penalties. Lessor shall indemnify, defend and hold harmless the City, its council
members, boards, commissions, committees, officers, employees, Authorized City
agents and volunteers ("Indemnified Parties," as defined in Section 10.1) from and
against any liability, claim, demand, penalty, cost or expense arising out of or in
connection with any contest by Lessor pursuant to this Section.
7. UTILITIES.
Lessor shall be responsible for all utility connection fees and ongoing monthly
costs. Consideration for the City's pro rata share of utility costs is included in the rent
discussed in Section 4 above.
8. ALTERATIONS TO THE PROPERTY.
8.1 Lessor Improvements. On the Commencement Date Lessor shall deliver
possession of the Premises to City free and clear of any prior tenants or occupants
(including, without limitation, their equipment and personal property), generally free of
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 9
any rubbish and debris, free of any construction materials and equipment, and
otherwise in its "as -is" condition, subject to any representations, warranties and
covenants of the Lessor specifically set forth in this Agreement. Subject to compliance
with all Laws, no later than March 1, 2017, Lessor shall construct improvements
consistent with those indicated in Section 2(a), as may be revised or modified to obtain
entitlements and/or building permits from the applicable local and state agencies.
Lessor shall obtain all necessary entitlements and permits to construct the
improvements. Lessor shall pay for all costs associated with construction to reconfigure
the site to use as an animal shelter including but not limited to addition/removal of
demising walls. Improvements shall be performed between 7:00 a.m. and 6:00 p.m. on
non -holiday weekdays. Any contractors hired by Lessor shall be fully licensed and
bonded. Lessor's contractors and any subcontractors shall obtain insurance in an
amount and form to be approved by City's Risk Manager, including workers
compensation insurance as required by law, general liability, automobile liability and
builder's risk insurance covering improvements to be constructed accordance with the
applicable requirements set forth in Exhibit "C," all pursuant to standard industry custom
and practice. City shall be named as an additional insured on the contractor's and any
subcontractor's policies.
8.2 Costs of Construction. Lessor shall bear all costs and expenses
associated with the design, use, construction, and maintenance of the Property and
Lessor Improvements (except for any costs and expenses incurred as a result of any
negligence or willful misconduct by City or any of its officers, agents, contractors, or
employees), which costs and expenses include without limitation: (i) relocation of
existing facilities (e.g., driveways, points of access, etc.), utility relocation, hook-up, and
connection fees and all distribution facilities, conduits, pipelines and cables legally
required in connection with the Property and Lessor Improvements; (ii) all design,
engineering, financing and construction costs; and (iii) all necessary studies and
appraisals, use permits or variances, and all grading, building and like permits required
to construct and operate the Property and Lessor Improvements, including any fees
assessed on the Property 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.
8.3 Permits. Unless restricted by law or otherwise provided in this Agreement,
Lessor shall obtain, and be responsible for the costs for all building permits and other
required permits necessary for the Property. If applicable, Lessor shall be responsible,
at its sole cost and expense, for compliance with the California Environmental Quality
Act ("CEQA") in connection with Lessor's operation and use of the Property.
8.4 Quality of Work Performed. All construction, maintenance and other work
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.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 10
8.5 Payment of Costs. Lessor shall pay all costs related to the construction of
the Lessor Improvments and any alterations and/or improvements by Lessor or its
agents, except for any costs incurred as a result of any negligence or willful misconduct
by City or any of its officers, agents, contractors, or employees.
8.6 Disposition of Alterations at Expiration or Agreement Termination. Any
alterations made to the Property shall remain on, and be surrendered with, the Property
on expiration or termination of this Agreement (excluding City's moveable personal
property). Prior to expiration or within thirty (30) calendar days after termination of this
Agreement, City may remove any moveable machinery, equipment, and other personal
property installed by City, provided that City repairs any damage to the Property caused
by removal and restore the Property to good condition.
9. MAINTENANCE OF THE PROPERTY
9.1 Maintenance and Repair by Lessor and Citv. City shall be responsible for
maintenance of the Premises, including routine janitorial and housekeeping costs. City
agrees that it shall keep the Property in good condition, free of trash and debris, with
reasonable wear and tear and damage by casualty and condemnation excepted. Lessor
may perform maintenance or repairs in the event City fails to commence any
maintenance or repairs required to keep the Premises in the condition described in this
Agreement within the time provided by Lessor in the written notice requesting such
maintenance or repair (which shall not be less than thirty (30) calendar days after the
date of such notice). Notwithstanding the foregoing, Lessor shall be responsible, and
shall promptly reimburse City, for any costs incurred by City to comply with this Section
9.1, which costs would not have been incurred but for Lessor's shared use of the
Property pursuant to Section 5.3.
10. INDEMNITY AND EXCULPATION; INSURANCE
10.1 Hold -Harmless Clause. Lessor and Home Free agree to indemnify,
defend and hold harmless the City, its City Council, Boards, Commissions, Committees,
officers, agents, volunteers, and employees (collectively, the "Indemnified Parties") from
and 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 Lessor, Home Free, Lessor's
or Home Free's employees, contractor, subcontractor, agents, guests, invitees,
occupation or use of the Property, specifically 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
caused or allegedly caused by the condition of the Property or an act or omission of
Lessor or Home Free or an agent, contractor, subcontractor, supplier, employee, or
servant Lessor or Home Free;
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 11
(b) Any work performed on the Property or materials furnished to the
Property at the request of Lessor or Home Free or any agent or employee of Lessor or
Home Free, with the exception of maintenance performed by City; and/or
(c) Lessor or Home Free's failure to perform any provision of this
Agreement or to comply with any requirement of Law or any requirement imposed on
the Property by any duly authorized governmental agency or political subdivision.
Lessor and Home Free's obligations pursuant to this Subsection shall not extend
to any Claim proximately caused by the negligence, willful misconduct, or unlawful or
fraudulent conduct on the part of the Indemnified Parties. This indemnity shall apply to
all claims and liability regardless of whether any insurance policies are applicable.
10.2 Hold -Harmless Clause. City agrees to indemnify, defend and hold
harmless the Lessor, its officers, agents, volunteers, and employees (collectively, the
"Indemnified Parties") from and 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 City, City's
employees, contractor, subcontractor, agents, guests, invitees, occupation or use of the
Property, specifically 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
caused or allegedly caused by the condition of the Property or an act or omission of City
or an agent, contractor, subcontractor, supplier, employee, or servant City;
(b) Any work performed on the Property or materials furnished to the
Property at the request of City or any agent or employee of City, with the exception of
maintenance performed by City; and/or
(c) City's failure to perform any provision of this Agreement or to
comply with any requirement of Law or any requirement imposed on the Property by
any duly authorized governmental agency or political subdivision.
City's obligations pursuant to this Subsection shall not extend to any Claim
proximately caused by the negligence, willful misconduct, or unlawful or fraudulent
conduct on the part of the Indemnified Parties. This indemnity shall apply to all claims
and liability regardless of whether any insurance policies are applicable.
10.3 Exculpation of City. Except as otherwise expressly provided in this
Agreement, City shall not be liable to Lessor or Home Free for any damage to Lessor or
Home Free or Lessor or Home Free's property from any cause other than the
negligence, intentional or willful acts of the Indemnified Parties. Except as otherwise
expressly provided in this Agreement, Lessor and Home Free waives all claims against
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 12
the Indemnified Parties arising for any reason other than the negligence, intentional or
willful acts of the Indemnified Parties. City shall not be liable to Lessor or Home Free
for any damage to the Property, Lessor or Home Free's property, Lessor or Home
Free's goodwill, or Lessor or Home Free's business income, caused in whole or in part
by acts of nature.
10.3 Insurance. Lessor, Home Free, and City shall maintain insurance in the
types and amounts specified in Exhibit "C," attached hereto and incorporated herein by
this reference.
11. DAMAGE OR DESTRUCTION OF PROPERTY; CONDEMNATION
11.1 Destruction of the Property. If the Property is totally or partially destroyed,
rendering the Property or any portion thereof totally or partially inaccessible or
unusable, Lessor shall restore the Property to substantially the same condition as
immediately prior to such destruction (including all trade fixtures, personal property,
improvements and alterations as are installed by Lessor or Home Free, which shall be
replaced by Lessor or Home Free at its expense), provided that, if such destruction
occurs prior to the Shared Use Termination Date, City shall be responsible for its pro
rata share of any restoration costs of materials, equipment, etc., required exclusively for
City's use of the Property, based on the extent of its then -current shared use rights
pursuant to Section 5.3 above. Alternatively, City may elect to terminate this Agreement
by giving notice of such election to Lessor within sixty (60) calendar days after the date
of the occurrence of any casualty if the cost of the restoration exceeds the amount of
any available insurance proceeds, if the damage has been caused by an uninsured
casualty or event, or if City reasonably estimates that repairs of the Property will take
more than six (6) months, and Lessor and City shall have no further liability or
obligations under this Agreement.
11.2 Destruction of Property. In the event that all or a portion of the Property is
damaged, and the Property or a material portion becomes inaccessible or commercially
unusable, and the damage or destruction cannot reasonably be repaired within twelve
(12) months after the date of the casualty, Lessor shall have the right to either:
(a) Terminate this Agreement by giving to City written notice (which
notice shall be given, if at all, within thirty (30) calendar days following the date of the
casualty), in which case this Agreement shall be terminated thirty (30) calendar days
following the date of the casualty; or
(b) Give City written notice of Lessor's intention to repair such damage
as soon as reasonably possible at Lessor's expense, in which event this Agreement
shall continue in full force and effect; however, Rent shall be abated in accordance with
the procedures set forth in Section 12. City may terminate this Agreement by giving
Lessor written notice at any time prior to the commencement of repairs if Lessor agrees
to repair the Property pursuant to this Section and fails to commence repairs within one
hundred twenty (120) calendar days after giving City written notice of its intention to
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 13
repair. In such event, this Agreement shall terminate as of the date of notice from City
to Lessor, and Lessor shall have no liability under this Agreement.
11.3 Condemnation. If the use or possession of the entire Property or any
material portion thereof shall be taken in condemnation proceedings, then City may
elect to terminate this Agreement by giving written notice of such election to Lessor
within sixty (60) calendar days after the date of such taking. If only a non -material
portion of the Property shall be taken in condemnation proceedings, then this
Agreement shall continue in full force and effect; however, Rent shall be proportionally
abated in accordance with the procedures set forth in Section 12.
12. ABATEMENT OF RENT
General Rule. In the event of damage or destruction of the Property (or any
portion thereof), or condemnation of the Property (or any portion thereof), and this
Agreement is not terminated, City may continue to utilize the Property for the operation
of the animal shelter to the extent it may be practicable and commercially reasonable,
as determined in City's reasonable judgment. Rent shall abate only in proportion to the
area of the Property that is rendered unusable (as determined in City's reasonable
judgment). The abatement of Rent shall commence on the date that use of the Property
is impacted and continue until the completion of those repairs necessary to restore full
use of the Property, if any, and City's re -opening of the Property. Lessor's obligation to
pay Taxes pursuant to this Agreement shall not be abated or reduced. Rent shall not
abate if the damage or destruction to the Property is the result of the negligence or
willful conduct of City or its employees, officers or agents.
13. PROHIBITION AGAINST VOLUNTARY ASSIGNMENT, SUBLETTING, AND
ENCUMBERING
Prohibition of Assignment. City and Lessor acknowledge that City is entering into
this Agreement in reliance upon the experience and abilities of Lessor and Home Free
and consequently, Lessor shall not sublease or encumber its interest in this Agreement
or in the Property, or assign substantially all or any part of the Property, or allow any
other person or entity to occupy or use all or any part of the Property other than for the
uses permitted under this Agreement and with the City's prior written consent. Any
assignment, sublease or transfer made without the City's written consent is null and
void, which consent shall not be unreasonably withheld.
14. DEFAULT; REMEDIES
14.1 Default by City. The occurrence of any one (1) or more of the following
events shall constitute a default and material breach of this Agreement by City:
(a) The vacating or abandonment of the Property by City for a period of
more than one hundred eighty (180) successive calendar days during which time City
shall be required to pay Rent and fulfill all other obligations under this Agreement,
without the prior permission of the Lessor, excluding closures during periods of
casualty, condemnation or permitted closures set forth in this Agreement or during
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periods when the Property is temporarily closed for routine breaks (e.g., Christmas
break, spring break, summer break, etc.);
(b) The failure by City to make any payment of Rent or any other
payment required by this Agreement, as and when due, when such failure shall
continue for a period of ten (10) calendar days after written notice of default from Lessor
to City;
(c) Except as specified in Subsection 14.1(b), the failure of City to
observe or perform any of the material covenants, conditions or provisions of this
Agreement to be observed or performed by City where such failure shall continue for a
period of thirty (30) calendar days after written notice thereof from Lessor to City;
provided, however, that if the nature of City's default is such that more than thirty (30)
calendar days are reasonably required for its cure, then City shall not be deemed to be
in default if City commences such cure within said thirty (30) calendar day period and
thereafter diligently prosecutes such cure to completion;
(d) The making by City of any general arrangement or assignment for
the benefit of creditors;
(e) City becomes a "debtor" as defined in 11 U.S.C. Section 101 or any
successor statute thereto (unless, in the case of a petition filed against City, the same is
dismissed within sixty (60) calendar days);
(f) The appointment of a trustee or receiver to take possession of
substantially all of City's assets located at the Property or of City's interest in this
Agreement, where such appointment is not discharged within sixty (60) calendar days;
and
(g) The attachment, execution or the judicial seizure of substantially all
of City's assets located at the Property or of City's interest in this Agreement, where
such seizure is not discharged within sixty (60) calendar days.
14.2 Remedies for Default by City.
(a) Cumulative Nature of Remedies. If any default by City shall
continue without cure beyond the time permitted under this Agreement, Lessor shall
have the remedies described in this Section in addition to all other rights and remedies
provided by law or equity, to which Lessor may resort cumulatively or in the alternative.
(1) Lessor may terminate this Agreement by giving City written notice
of termination with a specified termination date. In the event Lessor terminates this
Agreement, Lessor may recover possession of the Property (which City shall surrender
and vacate upon demand in the condition required under this Agreement) and remove
all persons and property. Lessor shall be entitled to recover the following as damages:
(A) The value of any unpaid Rent or other charges that are unpaid at
the time of termination (which value shall be computed by allowing interest at the rate of
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 15
ten percent (10%) per annum). All Rent and other charges shall begin to accrue late
charges from the date due or the date they would have accrued;
(B) The value of the Rent and other charges that would have accrued
after termination less the amount of Rent and charges the Lessor received or could
have received through the exercise of reasonable diligence as of the date of the
termination (which value shall be computed by discounting such amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of termination plus one
percent (1 %));
(C) Any other amount necessary to reasonably compensate Lessor for
the detriment proximately caused by City's failure to perform its obligations under this
Agreement; and
(D) 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. Lessor
shall be entitled to an award of the reasonable costs and expenses incurred by Lessor
in maintaining or preserving the Property after default (after the expiration of all notice
and cure periods), preparing the Property for re -letting, or repairing any damage caused
by an act or omission of City.
(b) Lessor's Right to Cure City's Default. Upon continuance of any
material default beyond applicable notice and cure periods, Lessor may, but is not
obligated to, cure the default at City's cost. If Lessor pays any money or performs any
act required of, but not paid or performed by, City after such applicable notice and cure
periods, the payment and/or the reasonable cost of performance shall be due as
additional Rent not later than ten (10) calendar days after service of a written demand
accompanied by supporting documentation upon City. No such payment or act shall
constitute a waiver of default or of any remedy for default or render Lessor liable for any
loss or damage resulting from performance, provided that City shall no longer be in
default to the extent the default is actually cured by Lessor, once reimbursement is
made to Lessor.
15. WASTE OR NUISANCE
City shall not commit or permit the commission of any waste on the Property.
City shall not maintain, commit, or permit any nuisance as defined in Section 3479 of
the California Civil Code on the Property. City shall not use or permit the use of the
Property for any unlawful purpose.
16. NO CONFLICTS OF USE, HAZARDOUS MATERIALS.
From the Effective Date and throughout the Term, the Parties shall not use,
occupy or permit any portion of the Property to be used or occupied in violation of any
Law. Lessor represents and warrants that, to the best of Lessor's knowledge: (i) City's
or Home Free's use of the Property does not conflict with applicable Laws, and Lessor
knows of no reason why City or Home Free would be unable to obtain all required
permits, licenses and approvals from the appropriate governmental authorities; and (ii)
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 16
the Property is not in violation of any applicable Law, rules or regulations and City's or
Home Free's contemplated uses will not cause any such violation. Provided City did not
bring, cause or allow such Hazardous Materials on the Property, City shall have the
right (but not the obligation) to terminate this Agreement, upon thirty (30) calendar days
advance written notice to Lessor in the event that Hazardous Materials are detected at
the Property and the presence or the remediation (without any obligation of City to
perform remediation) materially affects City's ability to operate the animal shelter at the
Property. "Hazardous Materials" shall mean any oil, flammable explosives, asbestos,
urea formaldehyde, radioactive materials or waste, or other hazardous, toxic,
contaminated or polluting materials, substances or wastes, including, without limitation,
any "hazardous substances," "hazardous wastes," "hazardous materials" or "toxic
substances" under applicable federal, state and local laws, ordinances and regulations.
17. LESSOR'S DEFAULTS/CITY'S REMEDIES.
Lessor shall be in default if it fails to perform, or commence performance if the
obligation requires more than ten (10) calendar days to complete, any material
obligation within ten (10) calendar days after receipt of written notice by City to Lessor
specifying the nature of such default. Lessor shall also be in default if it commences
performance within ten (10) calendar days but fails to diligently complete performance.
In the event of Lessor's default, City may:
(a) Upon thirty (30) calendar days written notice to Lessor, cure any such
default, and Lessor shall reimburse City the amount of all reasonable costs and
expenses incurred by City in curing the default; or
(b) Terminate this Agreement if Lessor's default materially interferes with
City's use of the Property for its intended purpose and Lessor fails to cure such default
within thirty (30) calendar days after a second written demand by City.
18. EVENT OF BANKRUPTCY
18.1 If this Agreement is assigned to any Person or entity pursuant to the
provisions of the Bankruptcy Code, 11 U.S.C. Sections 101 et seq., or any similar or
successor statute ("Bankruptcy Code"), to the extent permitted by the Bankruptcy Code
and applicable Laws, any and all monies or other consideration payable or otherwise to
be delivered in connection with such assignment shall be paid or delivered to Lessor,
shall be and remain the exclusive property of Lessor and shall not constitute property of
City or of the estate of City within the meaning of the Bankruptcy Code. Any and all
monies or other consideration constituting City's property under this Section not paid or
delivered to City shall be held in trust for the benefit of City and be promptly paid or
delivered to City.
18.2 To the extent permitted by the Bankruptcy Code and applicable Laws, any
Person or entity to which this Agreement is assigned pursuant to the provisions of the
Bankruptcy Code shall be deemed without further act or deed to have assumed all of
the obligations arising under this Agreement on and after the date of such assignment,
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 17
including the obligation to operate the Property, pursuant to Section 5.1.
19. NOTICES
Any notice, demand, request, consent, approval or communication that either
Party desires or is required to give shall be in writing and shall be deemed given three
(3) calendar days after deposit into the United States registered mail, postage prepaid,
by registered or certified mail, return receipt requested, or one (1) business day after
deposit with a reputable overnight courier for overnight delivery. Unless notice of a
different address has been given in accordance with this Section, all notices shall be
addressed as follows:
If to Lessor, to 20302 Riverside Drive, LLC
Attn: Kathy and Roy Leonard
20302 Riverside Drive
Newport Beach, CA 92660
Phone: 949-370-2776
If to City, to: City of Newport Beach Police Department
Attn: Traffic Services Lieutenant
870 Santa Barbara Drive
P.O. Box 1768
Newport Beach, CA 92658
Phone: 949-644-3740
Fax: 949-644-3794
With a copy to: City of Newport Beach
Attn: Assistant City Manager
100 Civic Center Drive
P.O. Box 1768
Newport Beach, CA 92658
And with a copy to: City of Newport Beach
Attn: Real Property Administrator
100 Civic Center Drive
P.O. Box 1768
Newport Beach, CA 92658
20. SURRENDER OF PROPERTY
At the expiration or earlier termination of this Agreement, City shall surrender to
Lessor the possession of the Property. City shall leave the Property in good and
broom -clean condition, reasonable wear and tear and damage by casualty and
condemnation excepted. All property that City is not required to surrender, but that City
does abandon for more than thirty (30) calendar days after the expiration or termination
of this Agreement, shall, at Lessor's election, become Lessor's property at expiration or
termination. Lessor shall owe no compensation to City for any personal property,
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equipment or fixtures left at the Property by City more than thirty (30) calendar days
after the expiration or termination of this Agreement.
21. COMPLIANCE WITH ALL LAWS
City shall at its own cost and expense comply with all statutes, ordinances,
regulations and requirements of all governmental entities, including federal, state,
county or municipal, whether now in force or hereinafter enacted. In addition, all work
prepared by City shall conform to applicable City, county, state and federal laws, rules,
regulations and permit requirements and be subject to approval of the City Manager or
his/her designee.
22. WAIVERS
The waiver by either Party of any breach or violation of any term, covenant or
condition of this Agreement, 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
Agreement, 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 Agreement or any applicable
law, ordinance or regulation.
23. SEVERABILITY
If any term or portion of this Agreement is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of this
Agreement shall continue in full force and effect.
24. CONFLICT
In case of conflict, the more specific provision of this Agreement shall control
25. APPLICABLE LAW
This Agreement shall be construed in accordance with the laws of the State of
California. Any action brought relating to this Agreement shall be adjudicated in a court
of competent jurisdiction in the County of Orange.
26. ENTIRE AGREEMENT; AMENDMENTS
26.1 The terms and conditions of this Agreement, 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 Agreement.
26.2 This Agreement shall supersede any and all prior agreements, oral or
written, regarding the subject matter between City and Lessor.
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26.3 No other agreement, promise or statement, written or oral, relating to the
subject matter of this Agreement, shall be valid or binding, except by way of a written
amendment to this Agreement.
26.4 The terms and conditions of this Agreement shall not be altered or modified
except by a written amendment to this Agreement signed by Lessor and the City
Manager or his/her designee, and approved as to form by the City Attorney.
26.5 If any conflicts arise between the terms and conditions of this Agreement,
and the terms and conditions of the attached exhibits or thedocuments expressly
incorporated by reference, the terms and conditions of this Agreement shall control.
26.6 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 Agreement.
26.7 The Recitals provided in this Agreement are true and correct and are
incorporated into the substantive part of this Agreement.
26.8 Each party has relied on its own inspection of the Property and examination
of this Agreement, the counsel of its own advisors, and the warranties, representations,
and covenants in this Agreement. The failure or refusal of either Party to inspect the
Property, to read this Agreement 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.
26.9 This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, and all of such counterparts shall constitute
one Agreement.
27. TIME IS OF THE ESSENCE
Time is of the essence for this Agreement.
28. SUCCESSORS; BINDING EFFECT
Subject to the provisions of this Agreement on assignment and subletting, each
and all of the covenants and conditions of this Agreement shall be binding on and shall
inure to the benefit of the heirs, successors, executors, administrators, assigns, and
personal representatives of the respective Parties.
29. INTERPRETATION
The terms of this Agreement 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
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the authorship of this Agreement or any other rule of construction which might otherwise
apply.
30. TABLE OF CONTENTS; HEADINGS
The table of contents of this Agreement and the captions of the various sections
of this Agreement are for convenience and ease of reference only and do not define,
limit, augment, or describe the scope, content, or intent of this Agreement.
31. 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.
32. EXHIBITS
All exhibits to which reference is made in this Agreement are incorporated by
reference. Any reference to "this Agreement" includes matters incorporated by
reference.
33. CITY BUSINESS LICENSE
Lessor and Home Free shall obtain and maintain during the duration of this
Agreement, a City business license as required by the Newport Beach Municipal Code.
34. ATTORNEYS' FEES
The prevailing Party in any action brought to enforce the terms and conditions of
this Agreement, or arising out of the performance of this Agreement, shall not be
entitled to recover its attorneys' fees.
35. NONDISCRIMINATION
City, Lessor, and Home Free, for itself and its successors, agrees that in the
performance under this Agreement, Parties shall not discriminate against any person
because of the marital status or ancestry of that person or any characteristic listed or
defined in Section 11135 of the Government Code.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 21
36. RESERVED.
37. NO THIRD PARTY BENEFICIARIES
City (both as a lessee and as the City of Newport Beach) and Lessor and Home
Free do not intend, by any provision of this Agreement, to create in any third party, any
benefit or right owed by one Party, under the terms and conditions of this Agreement, to
the other Party.
38. CALIFORNIA LABOR LAWS
It shall be the obligation of City, Lessor, and Home Free to comply with all Laws,
including, but not limited to, State of California labor laws, rules and regulations and the
Parties agree that the City shall not be liable for any violation by Lessor or Home Free
(or Lessor or Home Free's agent, sublesse or any party affiliated with Lessor or Home
Free) thereof.
39. NO DAMAGES
Lessor and Home Free acknowledges that City would not enter into this
Agreement 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 Agreement or any of the matters referred to in this Agreement, including,
without limitation, any and all plans, permits, licenses or regulatory approvals, and
CEQA documents related to the Property. Accordingly, Lessor and Home Free
covenants and agrees on behalf of itself and its successors and assigns, not to sue City
(either in its capacity as lessee in this Agreement 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 Agreement by City or for any dispute, controversy, or issue between City and
Lessor or Home Free arising out of or connected with this Agreement or any of the
matters referred to in this Agreement, 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 Lessor and Home Free's sole and exclusive
judicial remedies. Notwithstanding the foregoing, nothing in this Section 39 shall limit
Lessor's remedies as expressly set forth in this Agreement.
40. QUIET ENJOYMENT
So long as City pays Rent and complies with its obligations under this
Agreement, City shall peaceably and quietly enjoy the Property throughout the Term
without hindrance by Lessor, Home Free, or any person lawfully claiming through or
under Lessor, subject to the provisions of this Agreement.
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41. GOVERNMENT CLAIMS ACT
City, Home Free, and Lessor agree that in addition to any claims filing or notice
requirements in this Agreement, Lessor and Home Free shall file any claim that Lessor
or Home Freemay have against City in strict conformance with the Government Claims
Act (Government Code sections 900 et seq.), or any successor statute.
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20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 23
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: / z/fs /F
By: * , r
Aaron C. Harp
City Attorney
CITY:
CITY OF NEWPORT BEACH,
a California municipal corporation
Date:
By: �—
Kevin Muldoon
Mayor
ATTEST: pr LESSOR:
Date: l/ 20302 RIVERSIDE DRIVE, LLC, a
California limited I' bility company
Date: �I2� II t
By:Mj�==
By:yUir ,
Leilani I. Brown Kathryn L. Leonard
City Clerk Member
HOME FREE:
HOME FREE ANIMAL SANCTUARY,
a California corporation
Date:
I _F�71Z11.�1�
Vice President / Chief Financial Officer
Date:
By:
Virginia oto Martinez
Secretary
[END OF SIGNATURES]
Attachments: Exhibit A: Property Description and Depiction
Exhibit B: Premises Depiction and Equipment Description
Exhibit C: Insurance Requirements
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page 24
EXHIBIT A
Property Description and Depiction
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF
NEWPORT BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA AND IS
DESCRIBED AS FOLLOWS:
LOT 12 OF TRACT 2581, IN THE CITY OF NEWPORT BEACH, COUNTY OF
ORANGE, STATE OF CALIFORNIA AS PER MAP RECORDED IN BOOK 77, PAGE
15 OF MISCELLANEOUS MAPS IN THE OFFICE OF THE ORANGE COUNTY
RECORDER OF SAID COUNTY.
EXCEPT ONE-HALF OF ALL MINERAL, OIL, GAS, AND OTHER HYDROCARBON
SUBSTANCE, SAVED OR SOLD FROM THE HEREIN DESCRIBED LAND, UPON
THE CONDITION, HOWEVER THAT THE GRANTOR OR SUCCESSORS IN
INTEREST OF OWNERSHIP SHALL HAVE NO RIGHT OF ENTRY UPON THE
SURFACE OF THE LAND AND SHALL NOT DRILL FOR SUCH SUBSTANCES
WITHIN THE UPPER 500 FEET OF SAID LAND, AS RESERVED IN THE DEED FROM
JAMES M. WATKINS, SR., AND WIFE TO ODIS M. CLARK, RECORDED JANUARY
14, 1955 IN BOOK 2924, PAGE 190 OF OFFICIAL RECORDS.
APN: 439-251-05
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page A-1
EXHIBIT B
Premises Depiction and Equipment Description
City's Equipment on the Premises consists of:
1. One (1) washer;
2. One (1) dryer;
3. One (1) storage shed;
4. One (1) shop vacuum;
5. All cat cages in the back room;
6. Three (3) wire crates;
7. One (1) desk;
8. One (1) chair;
9. One (1) mini refrigerator for medicine;
10.One (1) laptop; and
11. One (1) printer.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page B-1
Exhibit C
Insurance Requirements
Without limiting Lessor's indemnification of City, Lessor will obtain, provide and
maintain at its own expense during the Term of this Agreement, a policy or
policies of insurance of the type, amounts and form acceptable to City. The
policy or policies shall provide, at a minimum, those items described below.
1. Provision of Insurance. Without limiting Lessor's indemnification of City,
and prior to commencement of work on Property by Lessor or Lessor's
agents, representatives, consultants, contractors and/or subcontractors,
Lessor shall obtain, provide and maintain at its own expense during the
term of this Agreement policies of insurance of the type and amounts
described below and in a form satisfactory to City. Lessor agrees to
provide insurance in accordance with requirements set forth here. If
Lessor uses existing coverage to comply and that coverage does not meet
these requirements, Lessor agrees to amend, supplement or endorse the
existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the insurance commissioner to
transact business of insurance in the State of California, with an assigned
policyholders' rating of A- (or higher) and financial size category class VII
(or larger) in accordance with the latest edition of best's key rating guide,
unless otherwise approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Lessor and Lessor's agents,
representatives, consultants, contractors and/or subcontractors,
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, Section 3700 of the Labor Code.
Lessor and Lessor's agents, representatives, consultants,
contractors and/or subcontractors, shall submit to City, along with
the certificate of insurance, a Waiver of Subrogation endorsement
in favor of City, its officers, agents, employees and volunteers.
B. General Liability Insurance. Lessor and Lessor's agents,
representatives, consultants, contractors and/or subcontractors,
shall maintain commercial general liability insurance, and if
necessary umbrella liability insurance, with coverage at least as
broad as provided by Insurance Services Office form CG 00 01, in
an amount not less than one million dollars ($1,000,000) per
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page C-1
occurrence, two million dollars ($2,000,000) general aggregate.
The policy shall cover liability arising from Property, operations,
personal and advertising injury, and liability assumed under an
insured contract (including the tort liability of another assumed in a
business contract) with no endorsement or modification limiting the
scope of coverage for liability assumed under a contract.
C. Automobile Liability Insurance. Lessor and Lessor's agents,
representatives, consultants, contractors and/or subcontractors,
shall maintain automobile insurance at least as broad as Insurance
Services Office form CA 00 01 covering bodily injury and property
damage for all activities of Lessor arising out of or in connection
with work to be performed at the Property, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not
less than one million dollars ($1,000,000) combined single limit
each accident.
D. Property Insurance.
(i) Construction. During construction of any improvements on the
Property, Lessor shall maintain Builder's Risk Insurance against "all
risk" of physical loss, including the perils of fire, collapse and
transit, with commercially reasonable deductibles, covering the total
cost of work performed, equipment, supplies and materials
furnished on a replacement cost basis. Lessor's obligation to
provide this coverage is contingent on the availability of coverage at
commercially reasonable rates.
(ii) Lessor shall maintain property insurance in an amount not less
than one million dollars ($1,000,000). The policy shall cover
Lessor's personal property and improvements at the Property.
4. Endorsements: Policies shall contain or be endorsed to contain the
following provisions:
A. Additional Insured Status. City, its elected or appointed officers,
officials, employees, agents and volunteers are to be covered as an
additional insured under all general liability and pollution liability
policies with respect to liability arising out of Lessor's activities
related to this Agreement and with respect to use or occupancy of
the Property.
B. Primary and Non Contributory. Policies shall be considered
primary insurance as respects to City, its elected or appointed
officers, officials, employees, agents and volunteers as respects to
all claims, losses, or liability arising directly or indirectly from
Lessor's operations. Any insurance maintained by City, including
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page C-2
any self-insured retention City
excess insurance only and not
provided hereunder.
may have, shall be considered
contributory with the insurance
C. Liability Insurance. Liability insurance shall act for each insured
and additional insured as though a separate policy had been written
for each, except with respect to the limits of liability of the insuring
company.
D. Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this Agreement shall be endorsed to waive
subrogation against City, its elected or appointed officers, agents,
officials, employees and volunteers or shall specifically allow
Lessor or others providing insurance evidence in compliance with
these requirements to waive their right of recovery prior to a loss.
Lessor hereby waives its own right of recovery against City, and
shall require similar written express waivers from each of its
consultants, contractors or subcontractors.
E. Reportinq Provisions. Any failure to comply with reporting
provisions of the policies shall not affect coverage provided to City,
its elected or appointed officers, officials, employees, agents or
volunteers.
F. Notice of Cancellation. The insurance required by this Agreement
shall not be suspended, voided, canceled, or reduced in coverage
or in limits except after thirty (30) calendar days (ten (10) calendar
days written notice of non-payment of premium) written notice has
been received by City. It is Lessor's obligation to ensure that
provisions for such notice have been established.
G. Loss Payee. City shall be included a loss payee under the
commercial property insurance.
5. Additional Requirements.
A. In the event City determines that (i) the Lessor's activities on the
Property creates an increased or decreased risk of loss to the City,
(ii) greater insurance coverage is required due to the passage of
time, or (iii) changes in the industry require different coverage be
obtained, Lessor agrees that the minimum limits of any insurance
policy required to be obtained by Lessor or Lessor's consultants,
contractors or subcontractors, may be changed accordingly upon
receipt of written notice from City. With respect to changes in
insurance requirements that are available from Lessor's then -
existing insurance carrier, Lessor shall deposit certificates
evidencing acceptable insurance policies with City incorporating
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page C-3
such changes within thirty (30) calendar days of receipt of such
notice. With respect to changes in insurance requirements that are
not available from Lessor's then- existing insurance carrier, Lessor
shall deposit certificates evidencing acceptable insurance policies
with City, incorporating such changes, within ninety (90) calendar
days of receipt of such notice.
B. Any deductibles applicable to the commercial property or insurance
purchased in compliance with the requirements of this section shall
be approved by City.
C. Lessor and Lessor's consultants, contractors and/or subcontractors
shall be subject to the insurance requirements contained herein
unless otherwise specified in the provisions above or written
approval is granted by the City. Lessor shall verify that all
consultants, contractors and/or subcontractors maintain insurance
meeting all the requirements stated herein, and Lessor shall ensure
that City is an additional insured on insurance required from
contractors. consultants and/or subcontractors.
D. For General Liability coverage, contractors, consultants and/or
subcontractors shall provide coverage with a format at least as
broad as provided by Insurance Services Office form CG 203
80413.
E. If Lessor maintains higher limits than the minimums shown above,
the City requires and shall be entitled to coverage for the higher
limits maintained by the Lessor. Any available insurance proceeds
in excess of the specified minimum limits of insurance and
coverage shall be available to the City.
F. Lessor shall give City prompt and timely notice of any claim made
or suit instituted arising out of or resulting from Lessor or Lessor's
agents, representatives, consultants, contractors or subcontractors
performance under this Agreement.
G. Lessor shall provide certificates of insurance, with original
endorsements as required above, to City as evidence of the
insurance coverage required herein. Insurance certificates must be
approved by City prior to commencement of work or issuance of
any permit. Current certification of insurance shall be kept on file
with City at all times during the term of this Agreement.
H. All required insurance shall be in force on the Effective Date, and
shall be maintained continuously in force throughout the term of this
Agreement. In addition, the cost of all required insurance shall be
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page C-4
borne by Lessor or by Lessor's consultants, contractors or
subcontractors.
If Lessor or Lessor's consultants, contractors or subcontractors fail
or refuse to maintain insurance as required in this Agreement, or
fail to provide proof of insurance, City has the right to declare this
Agreement in default without further notice to Lessor, and City shall
be entitled to exercise all available remedies.
J. Lessor agrees not to use the Property in any manner, even if use is
for purposes stated herein, that will result in the cancellation of any
insurance City may have on the Property or on adjacent Property,
or that will cause cancellation of any other insurance coverage for
the Property or adjoining Property. Lessor further agrees not to
keep on the Property or permit to be kept, used, or sold thereon,
anything prohibited by any fire or other insurance policy covering
the Property. Lessor shall, at its sole expense, comply with all
reasonable requirements for maintaining fire and other insurance
coverage on the Property.
20302 Riverside Drive, LLC Lease Agreement for Animal Shelter Page C-5
CERTIFICATE OF INSURANCE
CHECKLIST
City of Newport Beach
This checklist is comprised of requirements as outlined by the City of Newport Beach. *
Date Received: 3/9/17
Date Completed: 4/17/17
Dept./Contact Received From:
Sent to: Jenny By:
Alicia
Company/Person required to have certificate: Home Free Animal Rescue & Sanctuary
Type of contract: All Other
GENERAL LIABILITY
EFFECTIVE/EXPIRATION DATE: 9/8/16-9/8/17
A. INSURANCE COMPANY: Scottsdale Insurance Company
B. AM BEST RATING (A-: VII or greater): A+: XV
included): Is it included?
C. ADMITTED Company (Must be California Admitted):
❑ No
Is Company admitted in California?
❑ Yes ® No
D. LIMITS (Must be $1M or greater): What is limit provided?
1M/2M
E. ADDITIONAL INSURED ENDORSEMENT — please attach
® Yes ❑ No
F. PRODUCTS AND COMPLETED OPERATIONS (Must
❑ Yes
include): Is it included? (completed Operations status does
K. ELECTED SCMAF COVERAGE (RECREATION ONLY):
not apply to Waste Haulers or Recreation)
❑ Yes ❑ No
G. ADDITIONAL INSURED FOR PRODUCTS AND
❑ N/A ® Yes
COMPLETED OPERATIONS ENDORSEMENT (completed
Operations status does not apply to Waste Haulers)
❑ Yes ❑ No
H. ADDITIONAL INSURED WORDING TO INCLUDE (The City
its officers, officials, employees and volunteers): Is it
included?
® Yes ❑ No
I. PRIMARY & NON-CONTRIBUTORY WORDING (Must be
EFFECTIVE/EXPIRATION DATE: Sheri waived 4/3/17 — Leasing property only
included): Is it included?
® Yes
❑ No
J. CAUTION! (Confirm that loss or liability of the named insured
B.
AM BEST RATING (A-: VII or greater)
is not limited solely by their negligence) Does endorsement
C.
ADMITTED COMPANY (Must be California Admitted):
include "solely by negligence' wording?
❑ Yes
® No
K. ELECTED SCMAF COVERAGE (RECREATION ONLY):
® N/A ❑ Yes
❑ No
L. NOTICE OF CANCELLATION:
❑ N/A ® Yes
❑ No
II. AUTOMOBILE LIABILITY
EFFECTIVE/EXPIRATION DATE: Sheri waived 4/3/17 — Leasing property only
A.
INSURANCE COMPANY:
B.
AM BEST RATING (A-: VII or greater)
C.
ADMITTED COMPANY (Must be California Admitted):
Is Company admitted in California?
❑ Yes ❑ No
D.
LIMITS - If Employees (Must be $1M min. BI & PD and $500,000
UM, $2M min for Waste Haulers): What is limits provided?
E
LIMITS Waiver of Auto Insurance / Proof of coverage (if individual)
(What is limits provided?) N/A
F.
PRIMARY & NON-CONTRIBUTORY WORDING (For Waste
Haulers only): ® N/A
❑ Yes ❑ No
G.
HIRED AND NON -OWNED AUTO ONLY: ® N/A
❑ Yes ❑ No
H.
NOTICE OF CANCELLATION: ❑ N/A
® Yes 0 No
III. WORKERS' COMPENSATION
EFFECTIVE/EXPIRATION DATE: Sheri waived 4/3/17 — Leasing property only
A. INSURANCE COMPANY:
B. AM BEST RATING (A-: VII or greater):
C. ADMITTED Company (Must be California Admitted):
D. WORKERS' COMPENSATION LIMIT: Statutory
E. EMPLOYERS' LIABILITY LIMIT (Must be $1 M or greater)
F. WAIVER OF SUBROGATION (To include): Is it included?
G. SIGNED WORKERS' COMPENSATION EXEMPTION FORM:
H. NOTICE OF CANCELLATION:
ADDITIONAL COVERAGE'S THAT MAYBE REQUIRED
IV. PROFESSIONAL LIABILITY
V POLLUTION LIABILITY
V BUILDERS RISK
HAVE ALL ABOVE REQUIREMENTS BEEN MET?
IF NO, WHICH ITEMS NEED TO BE COMPLETED?
Approved: (i I
Agent of Alliant Insurance Services
Broker of record for the City of Newport Beach
4/17/17
Date
❑ Yes ❑ No
❑ Yes ❑ No
❑ Yes ❑ No
® N/A ❑ Yes ❑ No
❑ N/A ® Yes ❑ No
® N/A ❑ Yes ❑ No
® N/A ❑ Yes ❑ No
® N/A ❑ Yes ❑ No
® Yes ❑ No
RISK MANAGEMENT APPROVAL REQUIRED (Non -admitted carrier rated less than _
Self Insured Retention or Deductible greater than $ ) ❑ N/A ❑ Yes ❑ No
Reason for Risk Management approval/exception/waiver:
Risk Management approval needed due to GL carrier being non -admitted Sheri approved 4/17/17
City Approved Property insurance limit at $376,000 — 4/17/17
Approved:
Risk Management Date
* Subject to the terms of the contract.