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HomeMy WebLinkAbout09 LEASE AGREEMENT BETWEEN THE BOYS AND GIRLS CLUB AND THE CITY OF TUSTIN - REQUEST FOR LOAN FOR ROOF REPLACEMENTMEETING DATE: DECEMBER 5, 2017 TO: HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL FROM: CITY MANAGERS OFFICE SUBJECT: LEASE AGREEMENT BETWEEN THE BOYS AND GIRLS CLUB AND THE CITY OF TUSTIN REQUEST FOR LOAN FOR ROOF REPLACEMENT SUMMARY: In December 22, 1967, the City of Tustin and the Boys and Girls Club (Club) entered into a lease agreement (agreement) for 50 years to allow for the Boys and Girls Club to operate at 580 W. 6t" Street, Tustin, CA 92780 for the cost of $1.00 per year and other conditions as outlined in the agreement. Subsequently, the lease was amended three separate times (1980, 1981, and 1982) and is due to expire December 31, 2017. The City of Tustin and Boys and Girls Club have concluded negotiations regarding a new agreement that covers certain legal concerns related to eminent domain and alike. Attached is the proposed agreement effective immediately for a term of 20 years or unless earlier terminated in accordance with the provisions with the proposed lease. DISCUSSION AND BACKGROUND: The Tustin Boys & Girls Club is a non-profit organization that provides a safe, positive and enriching environment for youth the ages of 5-18 years of age. The Club provides a professionally trained staff to insure the development of positive self-esteem, proper values, and healthy life skills through constructive educational programs. Currently, the Tustin Boys and Girls Club has 750 children registered, with an average daily attendance rate of 238 students. The Club presently transports approximately 180 children from 23 different Tustin Unified Schools (see attached statistics). With 10 full-time staff and 14 part-time staff, the Tustin Boys and Girls Club focuses on 5 core areas: Agenda Report December 5, 2017 Page 2 Programs & Services: 1) Character & Leadership Development: Empowers youth to support and influence their Club and community, sustain meaningful relationships with others, develop a positive self- image, participate in the democratic process and respect their own and others' cultural identities. 2) Education & Career Development: Enables youth to become proficient in basic educational disciplines, apply learning to everyday situations and embrace technology to achieve success in a career. 3) Health & Life Skills: Encourages young people's capacity to engage in positive behaviors that nurture their own well-being and helps them to set personal goals and to live successfully as self-sufficient adults. 4) Sports, Fitness & Recreation: Encourages youth to develop an understanding for fitness, social skills, team building skills and a positive use of leisure time. 5) Arts: Engages youth to develop creativity and cultural awareness through knowledge and appreciation of the visual arts, performing arts, creative writing and crafts. REQUEST FOR LOAN FOR ROOF REPLACEMENT: The Tustin Boys and Girls Club has been good stewards of the property for the past 50 years and has maintained the facility in proper condition. Per terms of the current Lease Agreement and subsequent amendments, the Boys and Girls Club shall at all times protect and maintain, repair and keep the Lease Premises in a good order and condition (including structural and non-structural conditions). Recently, the roof of the facility has suffered from various issues and a roof replacement is needed. The Club has received formal bids of $90,000 with a 20 -year warranty. The needed replacement would put an extreme financial strain on the Club's finances. The Club would like for the City of Tustin to consider providing a $90,000 capital improvement contribution for the roof replacement. The City's contribution for the roof would be amortized over 15 -years with 2% interest analogous to a loan. Agenda Report December 5, 2017 Page 3 RECOMMENDATION: Staff recommends that the City Council direct the City Manager to execute the attached lease agreement between the Tustin Boys and Girls Club and the City of Tustin and authorize the City Attorney to make changes to the agreement consistent with the intent of this approval. 2. That the City Council discuss a $90,000 capital improvement loan to the Tustin Boys and Girls Club, amortized over 15 -years at a 2% interest rate. FISCAL IMPACT: Should the City Council grant a 15 -year loan of $90,000 at a rate of 2% to the Boys and Girls Club, the City would receive an annual payment is $7,004.29 with interest of 15 -years equaling $15,064.39 and an overall total repayment of $105,064,39. Currently the City receives less than 2% in Local Agency Investment Fund (LAIF). Year Principal Interest Total 1 $5,204.29 $1,800.00 $7,004.29 2 $5,308.38 $1,695.91 $7,004.29 3 $5,414.55 $1,589.75 $7,004.29 4 $5,522.84 $1,481.46 $7,004.29 5 $5,633.29 $1,371.00 $7,004.29 6 $5,745.96 $1,258.33 $7,004.29 7 $5,860.88 $1,143.41 $7,004.29 8 $5,978.10 $1,026.20 $7,004.29 9 $6,097.66 $906.63 $7,004.29 10 $6,219.61 $784.68 $7,004.29 11 $6,344.00 $660.29 $7,004.29 12 $6,470.88 $533.41 $7,004.29 13 $6,600.30 $403.99 $7,004.29 14 $6,732.31 $271.99 $7,004.29 15 $6,866.95 $137.34 $7,004.29 $90,000.00 $15,064.39 $105,064.39 CORRELATION TO THE STRATEGIC PLAN: This item contributes to the fulfillment of the City's Strategic Plan Goal A, Economic and Neighborhood Development, specifically addressing Strategy 6, by assessing and Agenda Report December 5, 2017 Page 4 exploring opportunities for expanded recreational activities with the implementation of a joint use agreement with the Tustin Boys and Girls Club. Attachments: Lease Agreement Dated 1967 Proposed Lease Agreement Club Statistics �hanie Najera I for Manageme t An lyst Parker nager ATTACHMENT 1 Lease, Agreement Dated 1967 1'1/4/82 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO. ROURKE & WOODRUP? (JGR) 1055 N. Main St., !1020 Santa. Ana, CA 92701 THIRD AMENDMENT TO LEASE IS AMENDMEN TO LEASE is made and entered into on this w2Hday of �c.��, 1982, by and between the CITY OF TUSTIN, a municipal corporation and THE BOYS' CLUB OF TUSTIN, a California non-profit charitable corporation. W I T N E S S E T Hz A. On or about December 22, 1967, the parties entered into that certain Lease of property described hereinafter. B. The parties caused the said Lease to be amended by Amendments to Lease dated September 30, 1980 and gt�Zae 17 1981. C. The description of the demised premises is as set forth in the legal description attached hereto, marked Exhibit "A" and incorporated herein by this reference as though set forth in full thereat. b. The parties desire to further amend the said Lease. NOW, THEREFORE, the parties hereto agree that the Lease dated December,22, 1957 by and between the City of Tustin, a municipal corporation and The Boys* Club of Tustin, a California non-profit charitable corporation, as previously amended, is hereby further amended as follows: 1. Section 18, Consent to a Sublease, is hereby added to Article XIII, to read as follows: "Section 18. Consent to a Sublease. Lessor hereby consents to a sublease etween asses and Six star Cablevision of Tustin, Inc., a California corporation, dated October 15, 1982, together with the Addendum to Sublease also dated October 15, 1982, in the form attached hereto 'masked Exhibit 0130 'and incorporated hereby by this reference as though set forth in full hereat. Lessee hereby agrees to be responsible for repair of any and all damage to the buildings and other improvements on the premises occurring or arising by reason of the actions or omissions of sublessee, and lessee further agrees to indemnify, defend, save and hold Lessor harmless from any and all liability from any claim or loss arising out of the installation, use, and/or maintenance of the premises by sublessee." IN WITNESS WBEREOF the parties hereto have executed this Third Amendment to Lease the day and year first above written. CITY OF TUSTIN, a municipal corporation APPROVED BY: . Me Y: d �,- CityAtonrttay ftiilv*w STATE OF CALIFORNIA ) ) SS COUNTY OF ORANGE THE BOYS' CLUB OF TUSTIN, a California non -prof charit- ftble ati l�a BY: On -[�J , 1982, before me, the undersigned, a ota P; e n anof said State, personally appeared u _ , known to me to be the, and known to e to be the � of YS IslCL OFS , a non-profit charitable California corporation, the corporation that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the within instrument pur- suant to its by-laws or a resolution of its Board of Directors. WITNESS my hand and official Seal. OFFICIAL SEAL MELISSA L GIGLITTO n t.0TARy PUSUC - CAOFORNIA DPMQ1 MM My calm. explrca JUL z5, t5&6 STATE OF CALIFORNIA } ) SS COUNTY OF ORANGE ) NNot�ary PublIC In anel to, sa�� County and State On , 1982, before me, the undersigned, a Notary FEIN in ana f or sai tate, personally appeared RICRARD EDGAR, known to me to be the Mayor, and [MARY WYNN, known to me to be the City Clerk of the CITY OF TUSTIN, the City that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the CITY OF TUSTIN therein named, and acknowledged to as that such City executed the within instrument pursuant to a resolution or minute order of the City Council of the CITY OF TUSTIN. WITNESS my hand and official seal. o ary FUM in ark for sa County and State -2- MCORDING REQUESTED BY AND-'-, 39954 B1( 14201 PG 13 1 WHEN �MCORDED MAIL TO. ROvRKZ *& WOODRUFF (JGR) 1055 V. Main #1020 SECOND AMENDMENT TO LEASE $9.OD Santa Ana, CA 92701 C10 Tele: 714/835-6212 ,THIS AMENDfIENT TO LEASE is made and entered into on this 17 day of 1981, by and between the CITY OF TUSTIN, a municipal corporation, and the BOYS' CLUB OF TUSTIN, a California ton -profit charitable corporation. W I T N E S S E T H: A. On or about December 22, 1967, the parties enter- ed into that certain lease of property described hereinafter. B. The parties caused the said Lease to be amended by Amendment to Lease dated September 30, 1980. C. The description of the demised premises is as set forth i.n_ the, legal..description.. attached hereto, marked Exhibit "A" and incorporated herein by this reference as though set forth in full hereat. I D. The parties desire to further amend the said Lease. NOW, THEREFORE, the parties hereto agree that the Lease dated December 22, 1967 by and between the City of Tustin, ,a municipal corporation and the Boys' Club of Tustin, a Calif- ornia non-profit charitable corporation, as amended by Amend- ment dated September 30, 1980, shall be and the same hereby is amended by the amendments attached hereto marked Exhibit 'IS" and incorporated herein by this reference as though set forth in full hereat. IN WINTESS WHEREOF the parties hereto have executed this Second Amendment to, Lease.- the xray and year first, above written. ATTEST* 0 ww"D REQCrRi jX Aqw ewsr. UWWU CITY OF TUSTIN, a municipal corporation BY., BOYS' CLUB OF TUSTIN, a California non-profit charitable corporation 13Y-. M AM, AUG 31 '81 BY STATE OF CALIFORNIA ss. COUNTY OF ORANGE BK 14201 Pe 1317 On h L4 4'S i, /7"K, 1981 before me, the undersigned, a Notary Pu In and or said State, personally appeared 'Aadl- i' known to me to be the President, and ,, known to me to be the Secretary of the B LU TUSTIN, a non-profit charitable California corpora- tion, the corporation that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the within instrument pursuant to its by-laws or a resolution of its Board of Directors. WITNESS my hand and ------------- AFP€CIAL SE4: NCiTAV PUBiIC•CAL:fCOMA ' PRINCIPAL MICE IN ORANGE COUNTY My Commission Expires Mar, 3,19$ STATE OF CALIFORNIA COUNTY OF ORANGE official seal. NOTAW PU LI n and for said Count d State SS. on rg(4jytgr /d" , 1981 before me, the undersigned; a Notary Public in and or said State, personally appeared JAMES B. SHARP, known to me to be the Mayor, and NARY WYNN, known to me to be the City Clerk, of the City of Tustin, the City that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the City of Tustin therein named, and acknowledged to me that such City executed the within instrument pursuant to a resolution or minute order of the City Council of the City of Tustin. WITNESS my hand and official seal. OFFICIAL. sent EVA A SOf1S 40TARY AUekr - CAWFORN€A OMWE WM MJr oar€r, "Okm 0M S, M JCR:se:R%7/27/81 (11) rli?/�✓ FSC . NOTARY PUBLIC n and for said County and State eK 1420 1 PO 1318 EXHIBIT A LEGAL DESCRIPTION OF PREMISES LEASED BY CITY OF TUSTIN TO THE BOYS' CLUB OF TUSTIN BY LEASE OF DECEMBER 22, 1967 AS AMENDED BY AMENOMENT TO LEASE DATED SEPTEMBER 30, 1980 Being that certain real property situate, lying and being in the City of Tustin, County of Orange, State of California, described as follows, to -wit: The Westerly 210.83 feet of the Easterly 397.04 feet of the portion of Lot Y of the. Stafford and Tustin 'Tract, as shown on a map recorded in book 2, page 618, of Miscellaneous Records of Los Angeles County, California, lying Northerly of the following described line: Beginning at a point in the center line of Tustin Avenue (66 feet wide), formerly Newport County Road, distant N. 00041555" W. thereon, 97.34 feet from the intersection of said center lime with the center line of 6th Street (66 feet wine), formerly Sycamore Street, as said Avenue and Street are shown on said map, thence S. 67032134" E., a distance of 2507.69 feet to a point on the center line of B Street (66 ,feet wide), as shown on map of Tract No. 541, recorded in Book 26, page 14, of fliscellaneous flaps, in the office of the County Recorder of said County of Orange, said point being distant along said last mentioned center line, 867.76 feet Southerly from the intersection thereof with said center line of 6th Street: EXCEPTING 'THEREFROM that portion thereof included within a. strip of land 200 feet wide, the South- westerly line of which is coincident with said line thereinabove described. EXCEPTING THEREFROM the easterly forty-one and seventy five -hundredths feet (.41.751) thereof. .SUBJECT to restrictions, reservations and easements of record. EXHIBIT A BK 14201 pe 1313 EXHIBIT B AMENDMENTS TO BE MADE TO LEASE FROM CITY OF TUS`rIN TO BOYS' CLUB OF TUSTIN DATED DECEMBER 22, 1967 AS AMENDED BY AMENDMENT TO LEASE DATED SEPTEMBER 30, 1980 1. Article I$ PREHISES, is hereby amended by the addition thereto after the words "leased premises" in line 28, of the following: , subject to the reservation of a well site or sites as hereinafter provided in Section 17. 2. Section 2, INDEMNITY, of Article VIII is hereby amended to provide as follows: Section 2. Indemnity Notwithstanding any provisions to the contrary con— tained in this lease, and irrespective of any insurance carried by Lessee, Lessor shall not be liable, and Lessee shall defend indemnify, and hold Lessor harmless against all liability and claims of liability, for damage or injury to person or property on or about the premises from any cause whatsoever, including but not limited to the passive negligence of Lessor or latent defect or dangerous condition on the premises, but excluding claims based on the sole negligence or willful misconduct of Lessor and/or its officers and employees. Lessee waives all claims against Lessor for damage or injury to person or property arising, or asserted to have arisen, from any cause whatsoever.' EXHIBIT B —1— " EXHIBIT i3 0 BK 1 P3 320 3. Article X, DESTRUCTION, is hereby amended as follows: A. After the words "occurrence of such partial destruction" on page 10, line 7, there shall be inserted the words "and/car in the event that said repairs are not carried forth to completion with reasonable dispatch". H. Subparagraph (b) on page 10, lines 16-30 shall be deleted. C. Section 2, Total Dostruction, is hereby amended by the deletion of the words on page 11, Lines 3 and 4 "for any cause ,for which Lessor is not responsible" and by the amend- ment of the sentence on page 11, commencing on line 7 with the words "in the", to read as follows: "In the event that the repairs to or rebuilding of said improvements have not been commenced 'within one (1) year after such destruction and/or have not been carried to completion with reasonable dispatch, Lessor may terminate this Lease by giving timely, written notice to Lessee of its election to terminate." 4. Section 17, Well Site, is hereby added to Article XIII, to read as follows: Section 17. Well Site. There is hereby reserved to Lessor such portion or portions of the westerly forty-one feet (411) of the demised premises, as are now, or hereafter, and/or from time to time, may be reasonably required, necessary or convenient for Lessor to install, construct, repair, replace, restore and/or maintain a well site or sites, together with all reasonable access for ingress and egress thereto and therefrom. Such site or sites shall be located, constructed and maintained by Lessor in EXHIBIT B _2_ EXHIBIT 8 BK 94201 po 132 such manner as to minimize interference with the uses and activities of Lessee insofar as is reasonable. 5. Exhibit "A", legal description for lease between City of Tustin and Boys' Club of Tustin is hereby amended by the addition thereto of the following: SUBJECT to the reservation and exception from the demised premises of a well site or sites in the westerly forty—one feet (411) of the demised premises as provided in Section 17 of Article XIII. EXHIBIT B —3— t ti, BK '142U I '' JL of oMW CWMV. CAGFO WIA RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: 39955 -g 0 AM AUG31 '8 ROURKE & WOODRUFF (JGR) 1055 N. Main #1020 Santa Ana, CA 92701 AMENDMENT TO LEASEffE0001 Uth IRA=, Coanyt Neter+ Tele: 714/835-6212 THIS AMENDMENT TO LEASE is made and entered into by and between CITY OF TUSTIN, a municipal corporation, and the BOYS CLUB OF TUSTIN, a California non-profit charitable corporation this 301 day of 1980. 14 T T N E S 5 E. T Hs A. On or about December 22, 1967, the parties entered into that certain lease of property described in the legal description attached hereto marked Exhibit A and incorporated herein by this reference (hereinafter "the leased premises"). B. A portion of the leased premises is unused and essentially unusable by the Bays' Club of Tustin. C. The parties desire to amend the description of the leased premises to delete this unused portion of property. NOW, T'HEREF'ORE, the parties hereby agree that the lease dated December 22, 1967, by and between the City of Tustin, a municipal corporation, and. the BOYS' CLUB OF TUSTIN, a California non-profit charitable corporation, be, and the same hereby is amended as follows: 1. The leased premises are amended to delete the easterly forty- one and seventy-five hundredths .feet (41.751) ,feet therefrom and the legal description of the lease (Exhibit A of the original lease dated December 22, 1967) is hereby amended to read as set forth in the legal description attached hereto marked "Exhibit B" and incorporated herein by this reference as though set forth in ,full hereat. 1 BK 14201 PO 1323 2, The lease between the parties dated December 22, 1967, shall remain in full force and effect and unamended except as expressly set forth hereinabove. IN WITNESS WHEREOF the parties hereto have executed this Amend- ment to Lease on the day and year first above written. CITY OF TUSTIN, a municipal corporation ATTEST: CIZf CLERK() BOYS' CLUB OF TUSTIN a California non-profit charity corporation PRBMENT E BETA �.. STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE on _P+urrayr .241, 19$/, before me, the undersigned, a Notary Public in and for said State', personally appeared sA.%xs B. s�ia r known to me to be the Mayor and MARY WYNN, known to me to be the City Clerk of the City of Tustin, a municipal corporation, that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the City therein named, and acknowledged to me that such City - 2 e r BK 14201 po 1324 executed the within instrument pursuant to a resolution of the City Council of the City of Tustin. WITNESS my hand and official seal. N OFFICIAL. SEAL 140TARY PUBLIC in and for~ said ` State EVA 1 MUS 0010Y PUSLIC • CA',., Aly cavh% oWm& tem ., E41 Y.. STATE OF CALIFORNIA I i 66, COUNTY OF ORANGE I On S-� b�r�36'' , 1980, before me, the undersigned, a Notary Public in and for said State, personally'appeared T� • , }7; l/ , known to me to be the President and _tfr_., known to me to be the Secretary of the California non-profit charitable corporation that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the within instrument pursuant to its by-laws or a resolution of its Board of Directors. WITNESS my hand and official seal, 3 NOT Y PUBLIC n an or sa State •`...._. �cw.7axaeuw�wnr �r C"MAL SNA! NORMA .I. STEN IENSON JGR:se:D:9/15/80 JGR:se:R:9/19/80 w nro:R=::wrauc•aA.�onwiA s rr ,� koura�r My Cammi4an Egims Mat. 11981 3 BK 14'201 pG 1325 LEGAL 1al;.'WRIPTION FOR J•a:AfoJ', Jsa'.1'aIVI- N 'I'aaas CITY OF "Al:;TIN A14D UIP, MY6 r a'a,UH OF'i`U:i'"'] N nninti thot t;ca,t:ai.n ir:al pl,opov,t.y t;i.tuat'n, lyin,; .:ar+i a:..irrrJ in int; rity of i r.,l'in, romil.y of Or,ovie, '31,0,t- ir.t I.:•'ai�r.,i�i•;r c4st.ri,br;d as follows, to wit: The Voj',i;rrly 210.83 foc;t of 1hr, a':t::,ir•"ly :697.00 fcnt of the pottioat of F'ot V tit t iv, St,trCord ¢road Tustin Tract, :a;s -hown on .n i recot.r.1,A in Sook 7., pSvjo 63R, of Records of Las Angotles CouaaLy, C:al•i(eirni�:, lying NuLthcurly+ of tate following d< st-ribor", Gina: Roginning At a point .in the c,:u ilio 1 `.nc of xusi.in Avenue (66 J.tct wide), fox,:,":rly county Road, distant N. 00 041 'r5" V% t hr k von, 97.34 feat from the hater--ec:tion of :r•ai.d ernInr Zinc with the contr-r line or Gt:h Sir" wt: (',6 .feet wirle) , forraorly Sycium,'n-e S1 r ooV, as ;.;ii e3 Avenue end St',a:oot ara shown on S+niid r,ip tasr„c:i: S. 670 32" 34" J•,. , a disLance of 2507.69 fr,,vt- to a point on the canter line of B Stroll, (66 poet wide) , as shown on map of 'x r,:ct No. 547., recorded in Book 25, pare 14, of Miscellaneous Maps, in the office of the C:tata,.ty Recorder of said County of Cir.ange, nP i d I)Oiaa3; being distant along said last mentioned canter line, 1367.76 feet Southerly from the inLernvc:tion thereof with said cantor line of 6th st rcet. k,XC:EPTSNG 1'HEa3i-:t^ROM that potl:i.an t•horcrif i,mciaused within a snip of land 200 feet wide, the South- westerly line of which is coincident with F Aid lane 1heroinabove described. S(U4JV,CT to resi t`i.ut'irrns, xur,nrvn1.icns mCi rust-ancnts of record. FW0M ,$ MEMO: LEGIBILlry 0�t7NQ, '�!'►' WO OR MUNTY44 umUTISFA!?JCltiY p4f Vi WHEAJ flBCEIveo. EXHIBIT 1.1 SK 14201 pa 132E L8GAL 0HSC1?1PTXUN FOR 1,11ASE 13E.TWFEN THE CITY OF TUSTIN AND TTIE BOYS' CLUB OF TUSTIN Being Lhat certain real properly situate, lying iind buiiiq in the City of Tustin, County of Orange, State of CalifoLnia, described as follows, td wit: The Westerly 210.83 feet of the Easterly 397.00 feet of the portion of Lot Y of the Stafford and Tustin Tract, as shown on a map recorded in Book 2, page 618, of Miscellaneous Records of Los Angnles County, California, lying Northerly of the following described line: Beginnipg'at'a point in the center line of Tustin Avenue (66 feet wide), formerly Newport County Road, distant N. 00 041 55" W. thereon, 97.34 feet from the intersection of said center line with the center line of 6th Street, (66 feet wide) , formerly- Sycamore Street, as said Avenue and Street are shown an said niap; thence S. 670.32' 3411 E., a distance of 2507.69 feet to a point on the center line of B Street (66 feet wide) , as shown on map of Tract No. 541, recorded in Book 26, page 14, of Miscellaneous Maps, in the office of the county Recorder of said County of Orange, said point being distant along said last mentioned center line, 867.76 feet Southerly from the intersection thereof with said center line of 6th Street. EXCEPTING THEREFROM that portion thereof included within a strip of land 200 feet wide, the South- westerly line of which is coincident with said line thereinabove described. EXCEPTING THEREFROM the easterly forty-one and seventy five -hundredths feet (41.751) thereof. SUBJECT to restrictions, reservations and ease- ments of record. EXHIBIT B RECITALS 1. The City of Tustin, a municipal corporation ("Lessor"), and The Boys' Club of Tustin, a California non- profit charitable corporation ("Lessee"), are parties to a lease of certain real property located at 590 'West Sixth Street, Tustin, California (the "Premises") dat d De tuber 22, 1957, and amended September 30, 1990, and y17 , 1881 (the "Lease"). 2. Lessee has signed a sublease (the "Sublease") with Six Star Cablevision of Tustin, Inc., a California corporation (the "Sublease*"), which would allow the Sublessee to use a utility room and a portion of the roof of the building located on the Premises for the reception and transmission; of cable television signal. A copy of the Sublease is attached hereto as Exhibit "A" and incorporated herein. 3. The Lass& requires in Article IK, Section 2, that Lessor consent in writing to any sublease of the Premises by Lessee. 4. Article TTI restricts Lessee's use of the Premises to "maintaining a norl-profit, education and recteational facility of a varied type, generally used for similar Boys' Clubs chartered throughout the United States by the Boys Club of America, and other purposes incidental and related thereto." S. Article VII, Section 1 of the Lease provides ' that the building, structures or improvements constructed or placed on the premises shall not be altered, remodeled, removed or destroyed by either panty to the Lease without the written consent of the other party. 6. Article VII, Section 4 of the Lease provides that improvements made by Lessee to the Premises shall immediately become the property of Landlord. 1. Pursuant to Article IX, Section 2 of the Lease, Lessox hereby consents to the Sublease on the terms not forth in the Sublease attached hereto. 2. Notwithstanding Article II of the Lease, Lessor hereby consents to the use of the Premises by Sublessee set forth in Section 4 of the Sublease. 3. Lessor hereby consents to Subiessee'es making of the alterations and improvements set forth in Section 7 of the Sublease; Lessor further consents to Section 17 of the Sublease which allows the -Sublessee to remove its Improvements at the expiration of the term of the Sublease, or upon any earlier termination of such term. MVE40 101482 Page l of 2 This consent was entered into this 5th day of Deaember,.7.982. ATTEST: (Seal) APPROVED City Attorney 0 THE CITY OF TUSTIN, a municipal corporation ZY MVw40 101382 Page 2 of 2 3 4 5 6 7 a 9 10 11 12 23 14 16 16 17 L B A S B THIS LF -AM, entered into thio.-Vday of December, 1967, by and between TIM CITY OF TUSTIN, a -municipal corporation, hereinafter referred to as "Lessor", and BOYL'CLUYO"V TUSTIN, a nor. -profit, charitable California corporation, hereinafter referred to as "Lessee". R B C. I T A L S Lessor is the owner of certain real property= In the County of Oran5e, State of Caligornia, more particularly described in 9>xticje I hereinafter; and Lessor desires to lease said property to Lessee, and Lessee desires to lease said property from Lessor; ANOW, TMEFORID, in consideration of the foregoing, and the xautual covenants and agreements hereinafter contained, the parties hereto do hereby mutually agree as follows; ARTICLE I Pit MISUS Lessor hereby leases and demises to Lessee, and Lessee hereby leases and takes from Lessor, for the term, at the rental sum, and u-;= the conditions 'set fort'.". hereinafter, those certain premises in the County of Orange, State of California, more particularly descriL%ed in E%hibit ".414, uhich is attached hereto and by this reference made a part hereof as if set forth in full, together with the perizanent in-Yroverients which shall be constructed and located thereon by Vne. Lessee; said land and is movements are hereinafter referred to as the "leased premises". TE.kD-.', "Ohe tern of this lease shall be for a period Of fift6v (50) years, =nnnenclrc, u-aon thed-Z-9fdav 190 ,/ I 2 3 4 5 6 7 i$ 19 20 21 22 .23: i24: 25 261 27 28 29, ao 31 32 provided, however, that if for any reason, subject to the pro- visions of Section 12 of Article X111 hereinafter, Lessee has not performed each and all of its obligations as specified in Article IV, Lessor may, at its sole option, terminate this Lease, upon one hundred and twenty (120) days' prior written notice to Lessee. ARTICLE III USE OF PREMISES Lessee shall use the leased premises solely for the purposes of maintaining a non-profit, educational and recreational facility &- a varied type, generally used for similar Boys' Clubs chartered throughout the United States by the Boys' Clubs of America, and other purposes incidental and related thereto Lessee shall not use or permit said premises or any part thereof to be used for any other purposes without first obtaining Lessor's written consent. Lessee shall observe and comply with all laws, orders, regulations, rules, ordinances and requirerients of the federal, state, county and city governments, and of all other governmental authorities, affecting the leased premises or appurtenances or any part thereof, and all of their deparizients, bureaus or officials, whether such laws? orders, re�.,ulations, rules or ordinances relate to alterations or repairs, to or in and about the leased premises or to chanes or requirements inci6ent to or as a result of any use or occupation thereof, or otherwise, and whether the sane are enforced at the conmencement of the lease terra. or may,, in the future, be passes, enacted or directed, and Lessee shall pay all costs, expenses, claims, fines, penalties and danagas that innay in any manner arise out of or be iisnposed 'because of failure of Lessee to coATVly with the provisions of this paracraph. it is agroed and undiarstood by the parties hereto that Ma is 17 is 19 20 21 22 .25 24 25 26 27 98 99 so 31 32 in the event Lessor, in its varied capacity as a municipal corporation, should enact, adopt or enforce a rule, ordinance, regulation, law or policy which forces a unique hardship on Lessee not generally borne by other charitable organizations with the City of Tustin, California, Lessee's performance under this Article shall be excused to the extent of such hardship. Lessee also agrees not to conduct or pormit to be conducted any public or private' nuisance thereon, nor to connit or per: it to be cowatitted any waste upon -the leased premises. Lessee shall permit the use of the leased promises, in whole or in part, for civic, educational and charitable purposes by other charitable, non-profit organizations, which are recogniz in writing by Lessor and which are exempt from all federal, state, and local income and property taxation, to the extent that such use is not incompatible with the use of the leased premises by Lessee. The detervination of such incormatibility shall be made by reasonable exercise of discretion of the Board of Directors of the Boys' Club of Tustin. ARTICLE IV RENT Section 1. For and during the tern, hereof lessee agrees to pay Lessor as annual rental for the leased vreraises the sur. of One Dollar (41,00). The first rental installment shall be paid upon the first day of the tern: of this Lease, and shall be paid annually in advance on or before the first day of each and every calendar year during said terra, Section 2. As a6ditional rent, consideration and benefit to Lessors Lessee shall construct inprovements as hereinafter provided, which said improvements shall revert with the deraised prernises to the Lessor at the end of the terra of this said Lease, or upon ary -3- I earlier termination thereof. Said improvements shall be 2 constructed at Lessee's sole cost and expense, and shall conform 3 to plans and specifications prepared by Lessee at its sole cost 4 and expense, and approved by Lessor, which said approval Lessor 5 agrees not to unreasonably withhold. 6 Section 3. On or before January 1, 1969; Lessee shall submit to 8 Lessor for its approval plans 'and specifications for the cDnstructj 9 on the leased premises of permanent improvements of an estimated 10; original construction cost of not less than One hundred Thousand Dollars 100,000.00). 12 Section 4. 13j on or before January 1, 1970, Lessee shall commence 141 construction of said improvem.ents, or of a part of said constructic 15 to the extent of a reasonable value of not less than one-half of th 16total estimated construction cost of said approved improvements. 171 Lessee shall diligently pursue such work to completion. Lessee 15 shall not authorize any variance from the plans and specifications 19, approved by Lessor, without the prior written approval of.Lessor; 20 provided, however, that Lessee need not secure such written approva 21 for any single variance which would increase or decrease the 221 :1 cost of construction by more than Two Thousand rive 1-u-ndred Dollars , il($2,500,00), or for all variances authorized during the course of 24 construction which would increase or decrease the cost of construc- 25 11 tion by more than Ton Thousand Dollars (* 10,000.00). 26 Section 5. 27 On or before July 1, 1970, said improventents, or one-half 28 thereof, as hereinabove specified, shall be completed. 291 Section 6. 30 On or before January 1, 1973, Lessee shall have commenced 31 construction upon the remaining one-half of the said improvemaants,. 32 as hereinabove specified. I Section 7. 2 on or prior to July 1, 1973, Lessee shall have completed 3 construction of the balance of said improvements. 4 ARTICLE V 5 TAXES AM ASSR:SSI-MTS 6 Section 1. Real and Personal Froperty 7 Lessee agrees to pair„ at least ten (10) days prior to 8 the date of delinquency, all real property taxes and assess.n.tents, 9 if aryl which may be assessed against the leased Premises. 10 Lessee shall also pay all taxes and assessments, if any, 4 any nature levied against any personal property, trace fixtures 12 or improvements belonging to Lessee on or about said leased 13 promises. 14 Section 2. Payment by Lessor 151 In the event Lessee fails to pay such taxes, assessments 16 ' 11 or charges, it any, Lessor may, at its option, at any time during 17 said ten (10) day period or after delinquency, pay any such 18 taxes, assessments or charges, together with all penalties 19 and/or interest which may have been added thereto by reason of 20 any such delinquency or default, and may likewise redeem the lease 21 promises, or any part thereof, or the buildings or improvements 22 located thereon, from any tax sale or sales. such amounts .23 so paid by the Lessor shall be inzediately paid by Lessee to 24 Lessor. a ARTICLE VI UTILITIv!S 97 During the term hereof, Lessee agrees to pay, when 2 j due, and to hold Lessor harmless from any liability for,any and 2gl all charges and/or assessments for water, sower, gas, electricity, 30 telephone and all other forms of utility services of every kind 31 and nature supplied to and used on the leased premises, including 32 all charges for installation of meters, conduits or other I 4 7 10 4 12 13 14 is 16 17 is 19 20 21 92 -23 U-1 25i 261 27 26 29 30 31 321 facilities required for such service. ARTICLE VII ALTERATIONS, KNIXTEMANCE AN -D REPAIRS Section 1. Alterations Neither Lessee nor Lessor shall at any tine alter, remodel, remove or destroy any building, structure or improvement constructed or ulaced on the leased =eniises without first obtaining the written consent of the other party hereto. section 2. Re*aiis and Xaintenance Any and all buildings and iTVrovements which may by either party hereto be erected or constructed on and become a part of said leased premises, pursuant to the terr..,,s hereof, shall during the term of this lease be kept and maintained in good repair and order, except for normal wear and tear, at the sole cost an4 expense of Lessee. Section 3. IV7aiver_Gf Repairs Lessor shall not be obligated to construct or make any irmrovements, alterations, additions or repairs to or upon the leased premises, or any part thereof, or any buildings or improvements located thereon, and the parties hereto do expressly waive any provisions of lav in contravention thereof; provided, however, and notwIthstanding the foregoing, upon written request of Lessee, Lessor may a5roe, yet in no manner must Lessor agree, at any time to alter, remodel, remove or destroy any buildings, structure or imprQvez.ent constructed or placed on the leased premises upon such terms as the parties may then agree. Section 4. 'Alterations, 11rar-rovements ane, Repairs byLessee If, after first obtaining the %=itten consent'of Lessor in accordance with Section I above, Lessee should alter, remodel, 1 remove or destroy any building, structure. or improvement constructed or placed on the leased nremises, or should construct or place any new buildings, structures or im-provements on the -6- said premises, all such improvements, alterations or additions which are made by Lessee shall immediately become the property of Lessor as part of the leased premises, subject to the covenants 4 and conditions of this lease. Lessee agrees, at all time, to save and keep Lessor and the leased premises free and harmless 6 from any and all liability on account of, or in respect to, 7 any mechanic's leins or liens in the nature thereof., for work 8 or labor done or materials furnished in anyway at the instance of 9 or request of the Lessee, in about or upon the leased premises; 10 provided, however, that the Lessee shall have the right to contest 4 the claim of such lien or liens, in which event the Lessee shall 12 furnish to the Lessor a sufficient surety bond executed by a 13 reputable and responsible surety company, in at least the 14 amount of such claim of such lien,,conditioned upon the diligent 15, prosecution of said defense, to hold the Lessor free and clear of 16 all loss, cost, damages and expenses of every kind and nature 17 arising directly or indirectly out of said contest, and Lessee 18 also agrees to pay any judgment that nay be so obtained forthwith. 19 ARTICLE VIII 20 INSURANCE AND INDE-WITY 21 Section 1. Insurance 22 Lessee agrees: .93, (a) To procure and maintain a policy or policies of 241i public liability and property damage insurance in a rood and 25 solvent insurance company or companies, such insurance to afford 26 protection to a limit of not less than Three Hundred Thousand 27 Dollars C 300,000.00) for injury or death of one person, and 28 Five Bundred Thousand Dollars 500,000.00) with respect to any 29 one accident, and to the limit of not less than riftv Thousand 3, Dollars 50,000.00) for -0 property damage. The obli5ation of the 31 Lessee contained in this subparagraph shall be deemed satis-JUed 32 upon the annual tender to Lessor of a certificate from the 3 4 5 6 7 8 9 MI -181 191 201 24 25�. 96 27 28 29 30 31 321 insurance company or companies providing the comprehensive liabilii policies for all of Lessee's operations indicating that the requirements of this subparagraph have been met; (b) At all tines during the term hereof to obtain and maintain in force, if required, at Lessee's sole expense, worltmen's corepansation insurance covering all yazsons employed in connection with any work being done or any service being perforned on the leased premises, (c) To procure and vvAintain at all tives during the term of this lease extended coverage fire, t:.ezft and destruction insurance against any loss or damage covered under the standard form of extended coverage insurance now in use in the State of California, covering the leased premises, including all improvements, buildings, fixtures and personal property upon said leased premises to the full insurable value thereof; (d) To deliver to Lessor, upon written de7zind, .certificates of coverage evidencing the insurance procured by Lessee under the terms hereof; (e) To pay any and all premiums or other expenses arisinv in connection with the furnishing of such insurance by Lessee as hereinabove, provided; (f) That all insurance policies shall contain a provisic that said policies shall not be cancelled or terrlinated without at least twenty (20) dayst prior written notice fro: the insurance co.mzany to Lessor, and that the ir.surence co,,.-ipary will sive said notice if said insurance is not maintained or renewed by Lessee at aky time. Lessee a5rees that prior to any expiration of any I insurance policy, Lessee vill celiver'to Lessor written notification in the form of a recei-�t or other siriilar document fru:.,, the applicable insurance that said. policy or policies have been renewed, or deliver: coxti--'-Jlcates of coverage fror- a-cther rood and solvent insurance co--7any -'-or at least the -8- same coverage. All insurance policies shall have the Lessor naned in such policies as one of the assureds. Section 2. IgggMaktt Not -withstanding anything to the contrary hereinabove contained, and irrespective of any insurance carried by Lessee, 6 yet subject to the terms of Article X hereinafter, Lessee agrees 7 to protect, indenmify and save Lessor har=mless from any and all 8 darnaves or liabilities of whatsoever nature arising out of or in 9 connection with t1he use, occupancy and/or operations carried 10 on by Lessee on the leased prerises.. 12 ASSIMMMT AND SUBLEASING 13 Section 1. kssiSnment 14 Lessee shall not assign this lease, in Whole or in part, 15 by operation of law or otherwise, without the prior written 16 cor.sent and approval of Lessor, and any such assignment without 17 such written consent shall be invalid and void for all purposes. 181 Section 2. sublease 19 Lessee shall not sublease all or any portion of the 201 leased premises, by operation of law or otherwise, without the 211 prior written consent and approval o€ Lessor, and any such sublease without such written consent shall be invalid and void 23{t for all purposes. 94 PORTICLIS 1 251 DESTRUCTION 26 Section 1. Partial Destruction 27 1 (a) in the event of destruction, other than that 281 4ntanded pursuant to the terms of ixticle I'll hereinaboVep of 29 less than forty percent (40t), in terms of area, of the physical 30 improvements being a part of the leased premises during the terra: 31 hereof for any cause for wich the Lessor is not responsible, uncle 32 the law of the State of California applical--le to private parties, Lessee agrees to forthwith repair the same. Such partial 2 destruction shall in no event annul this lease nor shall it 3 affect in any manner any of the terms and/or conditions of this 4 lease while such repairs are being made. in the event said repairs art not substantially underway, although they need not be 6 completed, within one hundred and eighty (180) days after the 71 occurrence of such partial destruction, this lease may be terming 8 at the option of either party hereto by giving written notice to 9 the other party of election to terminate; provided, in the event 10 of such termination, that Lessee agrees to assign and/or pay 41 to Lessor any benefits, claims, damages or awards, if any, which 12 Lessee may receive, or to which it may be entitled, from any 13 insurance coverage to the extent of the market value, immediately 14 prior to such damage or destruction, of the portion of the 151 improvements so destroyed. 16 (b) in the event such partial destruction is the 17 result of any cause for which Lessor is responsible, under 18 said law of the State of California applicable to private 19 parties, Lessor agrees to either: (1) repair such destruction 20 within the one hundred and eighty (180) day tire limit set forth P'll hereinabove; or (2) to pay to Lessee the actuarial use value P. . 21 of the remaining term, for all of the leased prwcises, of this .231 lease and terminate this lease upon timely written notice to 24 Lessee. Regardless of the alternative chosen by Lessor, under 25 the preceding terms of this sub -section, Lessee agrees to assign 26 . and/or pay to Lessor any and all benefits, claixiis, damages or 27 awards, if any, which Lessee may receive, or to which it may be 28 entitled, frox any insurance coverage to the extent of the market 29 value, iit)rLediately prior to such damage or destruction, o:E the 30 improvements so destroyed. 31 Section 2. Total 'Destruction 32 (a) In the event of destruction, other than that Trade 4 7 10 11 12 13 is 16 17 is 19 20 21 22 .23 24 25 96 27 28 291 30 311 321 pursuant to Article VII hereinabove, of more than forty percent (40%) in terms of area, of the improvements being a part of the leased premises, for any cause for which Lessor is not responsible, under said law of the State of California applicable to private parties, Lessee shall have the.option to: (1) rebuild said imnrovenri.ents; or (2) to terminate this lease by giving timely written notice of its election to Lessor. In the event that the repairs to or rebuilding of said improvements are not substantially underway, although they need not be completed, within one (1) calendar year after such destruction, Lessor may terninate this lease by giving timely, written notice to Lessee of its election to terminate. In the event Lessee elects to teryainate this lease, Lessee agrees to assign and/or pay to Lessor any benefits, clair.s, damages and awards, if any, which it may receive, or to which it may be entitled, from any insurance coverage to the extent of the market value of the improvements destroyed irmLediately prior to such destruction. In the event Lessee or Lessor elects not to terminate this lease, then while such im.proveraents are being repaired or replaced, the terms, conditions and provisions of this lease shall in no nai�*zaer be annulled or affected. (b) In the event such destruction is the result of any cause for which Lessor is responsible, under said law of the i State of California applicable to private narties, Lessee agrees to either: (1) repair such destruction -vithin the one (1) year time limit set forth hereinabove, or (2) to pay to Lessee the actuarial use value of the remaining terr., for all of the leased preff,ises, of this lease and terminate this lease by timely, written notice to Lessee. Regardless of the alternative chosen by Lessort under the preceding terms of this sub -section, Lessee agrees to assign and/or pay to Lessor any and all benefits, claims, damages or awards, if any, which Lessee may receive, or to waich it may be entitled, from any insurance coverage to the extent 2 of the market value, immiediately prior to such dstruction, of the improvements so destroyed. 4 ARTICLE XX 6 CONDMNIMON 6 12 during the tern, of this lease there is a taking or 7 transfer or damage to all or any part of the land subject to this 8 lease for public use by an individual or entity, public or private, 9 possessing the power of eminent domain, including Lessor, Vbether 10 by a condemnation proceeding or otherwise (hereinazfter referred to 4 as a "taking"), the rights and obligations, in regard to such 12 taking, of the Lessor and Lessee, as to their respective 13 interests in this lease only, shall be governed by the provisions 14 of this article. 15 Section 1. Date of TakipS, 16 In the event only a portion of the leased promises is 17 taken, yet the Dart remaining is not reasonably susceptible to 18 the use to which Lesseehad put the promises prior to such 19 taking, or if no land is actually taken but the entire property 20 is damaged by reason of the taking of access rights or similar 21 valuable property rights so that the entire remainder is not 22 reasonably susceptible to such use, then this lease nay be 123 terminated at the option of Lessee upon written notice to 24: Lessor. Such option to terr4nate must be exercised prior to the 26; earlier of the following dates: (1) the expiration of one 261 1 hundred and twenty (120) days after the service of summons in 27 any condemnation action; or (2) on the date legal possession SBtIor physical possession is Taken. Such termination shall be 29 effective no later than the date of the filing or recording of 30 a final order of condemnation or final Judgment or the date the 31 condemnor takes legal or physical possession, whichever occurs 32 first. R a 3 4' 5 6 7 8 9 10 4 12 13 14 1s 1.6 17 18 19 20 21 22 .23 24 25 26 27 28. 29 30 31 321 Section 2. Total Takinc3 In the event of a total taking, this lease shall terminate subject to the provisision of Section 5 herein, as of the date of taking as herein defined. Section 3. Partial Taking In the event only a ,portion of the leased premises is taken, yet the part remaining is not reasonably susceptible to the use to which Lessee had put the premises prior to such taking, or if no land is actually taken but the entire property is damaged by reason of the taking, of access rights or similar valuable property rights so that the entire remainder is not reasonably susceptible to such use, 'thea this lease may he terminated at the option of Lessee upon written notice to Lessor. Such option to terminate must be exercised prior to the earlier of the following dates; (1) the expiration of the one hundred and twenty (120) days after the service of the summions in any condemnation action; or (2) on the date legal possession or physical possession is taken. Such termination shall be effective no later than the date of the filing or recording of a final order of condemnation or .final judgment or the date the condemnor takes legal or physical possession, whichever occurs first. Section 4. Rental, Adjustment This lease shall, as the part taken, terminate as of the date of taking as herein defined, yet the rent payable hereunder shall not be adjusted or affected thereby. Section 5. abandonment of Condemnation Proceedings in the event the condemning agency shall abandon an eminent domain proceeding after serviced any notice of termination by Lessee, as provided for in Section 3 herein, then Lessee may, at its option, revoke and cancel such notice by notifying 'Lessor in %-,, iti.ng, not more than sixty (60) days -13- 9 10 11 � 12 13 14 15 16 17 18 19 20 211 22l -23 24 25 26 27111 2E 2; U 31 32 after there has been an express or implied abandonment in section 1255 (a) of the California Code of Civil Procedure, or any amendmen; thereof. Upon an express or implied abandonment, either party hereto shall have a right to contest the condemnor's abandonment and a right to its respective costs and disbursements as defined and provided for in said California code of civil Procedure, Section 1255 (a) or any amendment thereof. If, after the condemnor takes possession or the Lessee moves from the property sought to be condemned in compliance with an order of possession, the condermor abandons the proceeding as to such property or a portion thereof, or if it is determined that the condemnor does not have authority to take such property or a portion thereof by eminent domain, and the condemnor is required by law or deliver possesion of such property or such portion thereof to the parties entitled to possession thereof and pay da."aages•as are provided for in -California Code of Civil Procedure, section 1255(a) or any amendment thereof, then Lessee and Lessor shall divide the award of such damages, according to the ratio by which their respective losses bear to each other, and the Lessee shall be entitled to retake possession of the premises, and, in the event of such repossession by Lessee, all of the terms of this lease shall remain in operation. Section 6.Apportionment of Award In the event•that an award is made for the taking or damage of the land and improvements which are the subject of this lease in any action in direct or inverse condemnation, or in the event of a transfer in lieu thereof, the parties hereto agree that their respective rights to the award or compensation paid shall be as follows: (a) All of that portion of the award or compensation received for the appropriation of the leasehold estate created hereby shall be awarded to Lessee. -14- I 4 6 6 7 8 9 10 4 is 13 14 15 16 171 27 28 29 30 33. 32 (b) All of the remaining portion of the award or compensation, including all damages for severance, shall be awarded to Lessor. If there is an award made pursuant to a judgment and neither party can agree as to the values to be assigned to their respective interests in such award, the values cf these interests shall be determined under a proceeding governed by California Code of Civil Procedure, Section 1246.1 or any amendment thereof. Neither party will do any act or make any agreement whicg will impair the legal obligation of the condemnor to bear the costs of such proceedings. Both parties agree, however, that in the event such a proceeding is used, the rights of the respective parties hereto shall be governed by the f6rmula set forth herein. If there is a transfer in lieu of condemnation and the parties cannot agree as to their respective interest in the consideration received, a timely appraisal of their respective interests shall be conducted by three appraiser, each of whom is a member of the American Institute of Real Estate Appraiser, qualified for the purpose of appraising this type of property. The appraisal of each appraiser shall be made in accordance with the then standard practices of the American institute of Real Estate Appraisers. Within thirty (30) days after service by Lessee of a iwritten notice demanding appraisal, Lessor shall appoint in 1writing an appraiser and give written notice thereof to Lessee, and within thirty (30) days after service by Lessor of such written notice, Lessee shall, in a like manner, appoint an appraiser and give written notice thereof to Lessor. In case of failure of either party hereto so to do within the time specified, then the appraiser duly appointed by the other party shall proceed to deternine the fair marltet value of the interests 4 5 6 7 10 X1 19 13 14 15 16 17 18 19 20 91 22 .23 24 25 26 27 28 29 :50 31 32 as herein set forth. The two appraisers appoined shall select and appoint In writing a third appraiser and give -written notice thereof to Lessor and Lessee, or if within twenty (20) days after the right to make application to the President of the Southern California Chapter of the Institute of Real Estate Appraisers to appoint, in his sole discretion, such third appraiser. Each of the parties hereto shall pay for the�servicss of his appointee and one-half of. the cost of the services of the third appointee. The three appraiser shall submit their appraisals in writing ,in the then usual form to Lessor and Lessee. The parties agree that for the purpose of calculating the value of their respective interests, the value shall be deemed to be that amount which is determined by taking the numerical average of the two appraisal figures which are closest to each other. Section 7. Attorneys' Fee and Costs Each party shall bear its own costs, attorneys' fees, appraisers' fees and all other costs in connection with any matter contained in this article except as may be otherwise provided. Section S. Richt of Entry I Neither party hereto shall grant a right of entry to any condemnor without the written consent of the other party hereto. . Section 9. Rotice In the event either party'hersto receives actual or constructive notice of any acts on the part of any entity or individual possessing the power of eminent domain whish would cause or allow any of the provisions of this article to be invoked, then, in that event, such party shall give timely notice to the other party of such information. 1 2 .5 A 5 6 7 B 9 10 11 12 15 14 15'' 16' 17 18 19 20 .21, 22, 24i 2511111 26 27 28 29 30 31. 32 ARTICLE XII DEFAULT AND REMEDIES IN EVENT" of DEFAULT Section 1. Default Any and all of the following actions shall constitute a default of this lease: (a) Use of the premises for any purpose other than authorizied in this lease; or (b) Default in the payment of any installment of rental or other sum when dui:; or (c) Failure to pay any insurance premium, lien, claim, demand, Judgment or other charge provided for in this lease to be paid at the tire or in the manner hereinabove provided; or (d) Failure to maintain the leased premises or cause the same to be maintained as provided in this lease; or (e) Abandonment or vacation of the leased premises for a continuau period of thirty (30) days; or (f) Failure to perform or breach of any other covenant, condition or restriction provided in this lease to be kept or performed. Section 2. Remedies in Event of Default Upon default: (a) if said default is due to the failure to make the payment of any installment of rent or other sum when due, and there small also be a failure to remedy such default within (30) clays after written request so to do; or (b) In the event said default is due to other than the payment of monies, and in the event there shall also be failure to remedy such default within thirty (30) days after written request so to do, or if such default cannot be cured within thirty (30) days, if curative action has not been commenced within such period and is thereafter prosecuted. -17- 16 17 is 19 20 21 22 -.23 24 26 26 27 28 29 30 31 32 to completion with due diligence; Then, and in•either'of-said events, in addition to any other remedies Lessor may.have by operation of law, Lessor shall have the right, upon ten (10) days' prior written notice to Lessee, to declare this lease terminated. ARTICLE XIII MISCELLANEOUS Section 1. Inspection Lessor reserves the right for Lessor's agents and representatives: (a) To enter upon the leased promises at any reasonable time for the purpose of attending to Lessor's business and Lessor's interest hereunder. (b) To inspect said premises and do any other act or thing which Lessor shall at any tiza deem necessary or proper for the preservation or care of said leased premises or adjoining premises. Section 2. Payments and Notices Any notice to be given or other documents to be delivered by eith party to the other hereunder may be delivered in person to either party, or may be deposited in the United States mail in the State of California, duly certified, with postage prepaid, and addressed to the party1or whom intended as follows: To Lessor at: 135 West Third Street Tustin, California To Lessee at: P. 0. Box 781 Tustin, California 92690 Either party hereto may from time to time, by written notice to the other party, designate a different address which shall he substituted for the one above specified. if any notice or other documents is sent by certified retail, as aforesaid, the same shall be deemed served or delivered twenty-four (24) hours after the mailing thereof as provided above. Section 3. Waiver No waiver of any breach of any of the terms, covenants, 3 agreements, restrictions or conditions of this lease shall be 4 construed as a waiver of any succeeding breach of the same or other 5 covenants, agreements, restrictions and conditions hereof. 6 Section 4. Holding -Over 7 if Lessee shall hold over the leased premises after B the expiration or termination of the tern hereof, or an 9 extension of that term as provided herein, with the consent 10 of the Lessor, either express or implied, such holding over 11 shall be construed to be only a tenancy from year to year, is subject to all the covenants, conditions and obligations hereof, 13 and the Lessee hereby agrees to pay the same rental annually 14 as provided in this lease; provided, however, that nothing 16 herein contained shall be construed to give Lessee any rights 16 to so hold over and to continue in possession of the leased 17 premises after the expiration or termination of the term hereof. 3.6 Section 5. Surrender at End of Term 19 upon the expiration of the term of this lease, as 20 provided herein, or any extension thereof, or upon any sooner 21 termination thereof, Lessee shall promptly surrender to Lessor 221 all and singular of the leased ,premises. .231 Section 6. Lease Binding Upon Feirs 24 1 Subject to the limitations on assignment and subletting 25 each of the terms, covenants and conditions of this :lease shall 261 extend to and be binding on and inure to the benefit of not only S7I! the Lessor and the Lessee, but each of their respective 28f successors and/or assigns in interest. Whenever in this lease f 29 reference is grade to either the Lessee or the Lessor, the reference' 30 shall be deemed to include, whenever applicable, the feral 31 representatives, the successors and/or the assigns as if every 32 case specifically expressed. ..l g- 4 6 6 7 B 9 10 4 12 14 18 16 17 is 19 20 21 22 .23 24 25 26 27 28 29 30 31 32 Section 7. Time of the essence Time is expressly declared to_ba of the essence of this lease. Section S. Attorney's Fees In the event that any action is brought by either party hereto against the other party hereto for the enforcement or declaration of any right or remedies in or under this lease or for the breach of any covenant or condition of this lease, then and in that event, the parties in whose favor the final judgment is entered shall be entitled to recover, and the other party agrees to pay, all fees and costs to be fixed by the Court therein, including, but not limited to, reasonable attorneys' fees. In the event any action is biought by a third party or parties against either party herein and the other 'party hereto is joined therein solely by reason of its relationship under this lease, the party against whom the real cause of action has been asserted shall pay all fees and costs, including, but not limited to, reasonable attorneys' fees, incurred by the other party hereto in defending against such an action. I Section 9. Quitclaim Ikt the expiration or earlier termination of this lease, Lessee shall execute, acknowledge and deliver to Lessorr, within fifteen (15) days after written demand from Lessor to Lessee, any quitclaim deed or other document required by any reputable title company to remove the cloud of this lease from the real property subject to this lease, Section 10. Quiet Enjonment Lessee, upon paying the rent provided for herein and lobserving and performing all of the provisions of this lease to be performed and observed by Lessee, shall quietly have and enjoy, subject to all of the provisions of this lease, the -20- S premises during the term hereof, without hindrance or molestation ' :K by anyone lawfully claiming under Lessor. 3 Section 11. '"transfer of Lessor's Interest 4 In the event of any transfer or transfers of Lessor's 5 interest in the premises, the transferor shall be automatically B relieved of any and all obligations and liabilities on the part 7 of Lesser accruing from and after the date of such transfer. $ Section 12. Force 'Aajeure 9 In the event the performance by either party of any 10 of its obligations hereunder is delayed by reason of an act or the 11 neglect of the other party, or its officer, employees, or agents, 12 an act of God, stormy or inclement weather, strike, labor 13 dispute, boycott, lockout or other like action, inability to obtain 14 labor or materials, governmental acts or restrictions, riot, 15 insurrection, war, catastrophe, casualty, act of the public enemy, '6 or any other cause, whether similar or dissimilar, beyond the 17 reasonable>control of the ,party from whom such performance is due,. 18 the period for the commencement or completion thereof shall be 19 extended for a period equal to the period during which performance 20 is so delayed, provided, however, that Lessor shall not be 21 excused for any period, under the terms of this section, for its P2 own governmental acts, enactments or regulations unless such .233 acts, regulations or enactments are required by Lessor by 24 reason of the supremacy of any state or federal governmental 2541 richt of power. 27( Section 13. �telationshin of the Parties II she relationship of the parties hereto is that of 28 Lessor and Lessee, and it is expressly understood and agreed 29 that: (1) Lessee does not in any way, nor for any purpose 30 become a public body, agency or service of any nature whatsoever; 31 and (2) Lessor does not in any way become responsible far, 32 the sponsor of, a participant in or liable for Lessee, its 21- F"REE"WAY L T415 TIN AVENUE r 32 vorr - ASSESSOR'S BLOCA s.rAFFoRo a rusnv rR. L.A. I-15,16 a Lor NumaE-Rs TR. NO. 5415 M.M 210-45, 46,47 SHOWN IN CIRCLES I i / 30 TRACT YOM LOSE 10 FR.,mcr NO19415 AND 7-US71N 5 TA FFORD 4 °: BRAC r Lo 60 F"REE"WAY L T415 TIN AVENUE r 32 vorr - ASSESSOR'S BLOCA s.rAFFoRo a rusnv rR. L.A. I-15,16 a Lor NumaE-Rs TR. NO. 5415 M.M 210-45, 46,47 SHOWN IN CIRCLES 1 3 4 5 6 7 a 9 10 4 13 14 15 16 17 1$ 19 20 21 22 •23 24 25 26 27 28 29II 30 31 52 7 acts or its operations nor shall Lessor be, in any manner, engaged in any proprietary or private act or enterprise. Section 14. Number and Gender Whenever the singular number is used in this lease, when required by the context the same shall include the plural, and the masculine gender shall include the feminine and the neuter genders, and the word "person" shall include any individual, partnership, corporation, firm or association, whether public or private, and whether a municipal, non-profit or profit-making party or entity. Section 15. Readings and Titles The marginal headings or title to the paragraphs of this lease are not a part of this lease and shall have no effect upon the construction or interpretation of any part of this lease. Section 16. tire A reement This lease contains the entire agreement of the parties hereto with respect to the matters covered hereby, and no other agreement, statement or promise made by any party hereto, or to any employee, officer or agency of any party hereto, which is not contained herein, shall be binding or valid. IN ii'ITNESS MiEREOF, the parties hereto have executed this lease the day and year first above written. ( Sea 1) ATTESTATION BY CITY CLERIC APPROVED AS TO 'ORM y Y� City Attsrrney . THE CITY OF TU5TIN, a mu icipal corporation Byf, "Lessor" BOYS I CLTJB OF "TUSTIN— a By: Ey: • -22- "Lessee", EXHIBIT "A" LEGAL DESCRIPTI0N FAR LEASE BETWEEN THE CITY OF TUSTIN AND THE BOYS' CLUB OF TUSTIN Being that certain real property situate, lying and being in the City of Tustin, County of Orange, State of California, described as follows, td wit: The Westerly 210.83 feet of the Easterly .397.00 feet of the portion of Lot Y of the Stafford and. Tustin Tract, as shown on a map recorded in Book 2, page 61$, of Miscellaneous Records of Los Angeles County, California, lying Northerly of the following described line: Beginning at a ,point in the center line of Tustin Avenue (66 feet wide), formerly Newport County Road, distant N. 00 04' 55" W. thereon, 97.34 feet from the intersection of said center line with the center line of 6th Street (66 feet,wide), formerly Sycamore Street, as said Avenue and Street are shown on said map;,thence S. 670.32' WE., a distance of 2507.69 feet to a point on the center line of B Street. (66 feet wide), as shown on map of Tract No. 541, recorded in Book 26, page 14, of Miscellaneous Maps, in the office of the County Recorder of said County of Orange, said point being distant along said last mentioned center line, 667.76 feet Southerly from the intersection thereof with said center line of 6th Street. EXCEPTING THEREFROM that portion thereof included within a strip of land 200 feet wide, the South- westerly line of,which is coincident with said line thereinabove described. SUBJECT to restrictions, reservations and easerqents of -record. EXHXEIT "A" (FIFTY YEAR AGREEMENT) CERTIFICATE OF WORKERS' COMPENSATION COVERAGE Dec 8� DATE 2011 go-DUCER Nonftorits' United Workers' Compensation Group 4311 Siren, Suite 200 Sacramento, CA 95814 Phone; (916) 764-0056 Fax: (916) 880-S23I THIS CERTIFICATE IS ISSUED AS MATTER OF INFORMATION ONLY AND CONFERS NO BIGHTS UPON THE CERTIFICATE HOLDER, THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW, Marsh Risk & Insurance Services 345 California Street, Suite 1300 San Francisca. CA 94104 INSURERS AFFORDING COVERAGE INSURED D), JIM,— INSURERk NonProfits' United Workers' Compensation Group BOW & Girls' Club of TustinINSURERS 580 W. ft Street DEC 2 7 2011 ACE American Insurance Company [NAIL # 22667) INSURER 0: Tustin, CA 92780 OFFICE­TUSmn cr;-y CLEPK INSURER D, INSURER E This Cerflftate is not lintended to specify all endorssmtsn%Covera M, terms, conditions and exclusions of the polides shown. -COVERAGES THE POLICIES OF COVERAGE LISTED BELOW HAVE BEEN ISSUED TO THE AFFILIATE mEwER NAMED ABOVE FOR THE POLICY PERIOD INDICATED. N0TwjTHsTANDjNG ANY REQUIREMENT, TERM, OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE COVERAGE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERM, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES, AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS, INSR LTR TYPE OF COVERAGE POLICY NUMBER POLICY EFFECIWE DATE POLICY EXPIRATION DATE umffs GENERAL LIASILITY EACH OCCURRENCE $ 1 COMMERCIAL GENERAL L"tLITY FIRE DAMAGE (Any ora firs) $ 1 ICLANSMADe I 100CUR MED EXPENSE (Any — PW.0n) $ GENIURAL AGGREGATE LIMIT APPLIES PER: PERSONAL & ADV INJURY $ POLICY PAojacT Loc MNEP40L AGGREGATE $ PRODUCTSZOMPtQP AGG $ AUTOMMLE LIABILITY COM04NEO SINGLE LIMIT $ ANY AUTO faachaVAWO $ BOOTLY INJURY $ ALL OWNED AUTOS SCHEDULED AUTOS (Per Pars* $ HIRED AUTOS BOOLY INJURY $ NON -OWNED AUTOS (Pw O=dent) $ PROPERTYDAMAGE $ (Per accident) $ WORKERS' COMPENSATION WC STAT LIMIT$ X OTHER EL EACHACCOENT $500,000 A AND NPU-WCG Of) (-2012 1/1/12 1/1/13 E.L. DISEASE -EA EMPLOYEE $500,000 EMPLOYERS LIABILITY El. OISEASS - COVERAGE LIMIT $ W0,000 B OTHER EXCESS Workers' Compensation I WCL 046245283 I/1112 1/1/13 $35,000,000 x $500,000 WC - - $2,000,000 x $600,000 EL DESCRIPTION OF OPERATIONSILOCATIONSNEMMLESIEXCLUStONS ADDED BY ENDORSEMSNTISPECIAUPROVISIONS Evidence of Workers' Conipwisation Covcrage; Waiver orSubrogation provided ky Endorsement NPUWCG-I3NG'ruS-02 CERTIFICATE HOLDER ADDITIONAL INSUREO4 INSURER LETTER; CANCELLATION NPLjWCG-HNGTLjS-02 SHOULD ANY OF THE ABOVE DESORGED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF NOTICE WILL BE DELIVERED CirvofTusdn IN ACCORDANCE WTH THE POLICY PROVISIONS, PO Box 1089 Tustin, CA 92791-1089 Based on ACORD 25 (2009109) THIS ENDORSEMENT CHANGES THE MEMORANDUM OF COVERAGE PLEASE READ IT CAREFULLY WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US Nonprofits' United Workers' Compensation Group Memorandum of Coverage: NPU-WCG 001-2012 This endorsement modifies the coverage provided under the following: Memorandum of Coverage: PART ONE: WORKERS' COMPENSATION COVERAGE Paragraph H. RECOVERY FROM OTHERS is amended with respect to the following: Name and Address of Person or Organization: City of Tustin PO Box 1089 Tustin, CA 92781-1089 DESCRIPTION OF OPERATIONS/LOCATIONS ADDED BY ENDORSEMENT: - with regard to the City of Tustin, Its officers, officials, employees and volunteers NPU-WCG waives any right of recovery it may have against the person or organization shown above because of payments made by NPU-WCG for injury or damage arising out of the Members' operations done under a contract with that person or organization shown above and included in the coverage provided by the Memorandum of Coverage. This waiver applies only to the person or organization shown on the Schedule Above, This endorsement is part of the Memorandum of Coverage and is effective on the date shown below: All other terms and conditions remain unchanged. f#Wive Date lanuaryl.2012Expiration Aut orizedRepresent tive for Iii— ; NPU-WCG Page MOO NPI]-WCG 001-201.2 LEASE BETWEEN THE CITY OF TUSTIN 1 THIS LEASE ("Lease") entered into effective this _ day of , 2017 (the "Effective Date") by and between the CITY OF TUSTIN (the "Lessor"), a municipal corporation, and the BOYS' AND GIRLS' CLUB OF TUSTIN, a non-profit, charitable California corporation (the "Lessee"). The Lessor and Lessee are sometimes referred herein individually as a "Party" and collectively as the "Parties". RECITALS A. Lessor is the owner of certain land in the County of Orange, State of California, more particularly described in Exhibit A (the "Land"). All existing improvements, fixtures and/or alterations located on the Land as of the Effective Date of this Lease are referred to herein as the "Existing Improvements". The Existing Improvements, together with any additional improvements, fixtures and/or alterations constructed or installed on the Land by or at the expense of Lessee following the Effective Date are collectively referred to herein as the "Improvements". The Improvements are or shall be, when constructed or installed on the Land, owned by Lessee, subject to the provisions of this Lease (including without limitation the provisions of Section 16.1 below). Land and the Existing Improvements and the Improvements, and appurtenant easements (if any) are collectively referred to herein as the "Lease Premises". B. The Parties entered into that certain Lease dated as of December 22, 1967 (the "1967 Lease"), as amended by that certain Amendment to Lease dated as of September 30, 1980 and recorded on August 31, 1981 in Book 14201, Page 1322 of the Official Records of Orange County, California (the "Amendment'), that certain Second Amendment to Lease dated August 17, 1981 and recorded on August 31, 1981 in Book 14201, Page 1316 of the Official Records of Orange County, California (the "Second Amendment"), and that certain Third Amendment to 'Lease dated as of November 5, 1982 (the "Third Amendment"). The 1967 Lease, the Amendment, the Second Amendment and the Third Amendment are collectively referred to herein as the "Original Lease". Lessor, Lessee and Foster Art Services, Inc. entered into an agreement dated August 17, 1981 which was recorded on September 25, 1981 in Book 14234, Page 673 of the Official Records of Orange County, California, which agreement was amended by instrument dated August 1, 1984 and recorded as Instrument No. 84-419800 in the Official Records of Orange County, California (said agreement as amended is refer -red to herein as the "Foster Agreement"); the rights of ingress and egress in favor of Lessor as set forth in the Foster Agreement are affected by a Quitclaim Deed from Lessor to Tustin Self -Storage, recorded April 12, 1985 as Instrument No. 130375 in the Official Records of Orange County, California. C. The term of the Original Lease was set to expire on December 31, 2017. The multiple changes made to the 1967 Lease since its inception are complex and overlapping, and in the interest of clarity, the parties desire to make this comprehensive review and update of the Lease. 594733.10 D. Lessee also desires to alter and expand existing facilities on the Lease Premises to accommodate the future growth they expect in demand for their services. In order to expand and improve the existing Boys' and Girls' Club of Tustin, Lessee is in the process of securing donors willing to fund necessary long-term alterations and improvements. Anticipated donors need more certainty regarding the term of the Lease relative to the life of anticipated improvements prior to making donor commitments. E. The Parties each desire to enter into this Lease to address the items identified in the Recitals, among other things. F. Lessor and Lessee intend that this Lease shall, as of the Effective Date, supersede and replace the Original Lease, including all previous amendments and other agreements identified in Recital A above, in their entirety. NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated in the operative provisions of this agreement by this reference, and the terms, covenants, conditions and agreements herein, the Parties, hereby mutually agree as follows: AGREEMENT 1. LEASE OF PREMISES Lessor hereby leases, rents, and demises to Lessee, and Lessee hereby leases from Lessor the Lease Premises on the terms set forth in this Lease. 2. TERM, COMMENCEMENT, TERMINATION 2.1 Commencement and Termination. Unless earlier terminated in accordance with the provisions of this Lease, the term ("Term") of this Lease shall commence on the Effective Date and end on the date that is the twentieth (20th) anniversary of the Effective Date (the "Lease Termination Date"). 2.2 Surrender and Restoration. 2.2.1 Surrender. Upon expiration of the Term of this Lease or its termination by Lessee or Lessor, Lessee shall quietly and peacefully remove itself and its property from the Lease Premises and surrender thereof to Lessor on the expiration date, or the date of prior termination; provided, in the event that Lessor terininates this Lease for a default of the Lease by Lessee, Lessee shall be allowed a reasonable period of time, as determined by Lessee, in which to remove all of its property from and terminate its operations on the Lease Premises; provided further that nothing to the contrary in this Lease withstanding, Lessee shall not be obligated or required to remove any of the Improvements or alterations from the Lease Premises except Improvements or alterations made by Lessee without compliance with this Lease, which Improvements or alterations shall be removed by Lessee upon Lessor's written request. Reference to Lessee's property that may be removed from the Lease Premises by Lessee as contemplated above, shall include trade fixtures, equipment, personal property and inventory which Lessee has made or brought on to the Lease Premises at any time in accordance 594733.10 2 with the provisions of this Lease or the provisions of the Original Lease (collectively, the "Trade Fixtures"), and such removal may be undertaken by Lessee within the time frames specified as long as the removal will not cause structural damage to the Lease Premises and Lessee, at Lessee's expense, promptly restores the Lease Premises to at least the condition that existed prior to any damage caused by the removal. During such period prior to surrender, all obligations assumed by Lessee under this Lease shall remain in full force and effect. Lessor may, in its discretion following thirty (30) days notice to Lessee, declare any property which has not been removed from the Lease Premises upon surrender as abandoned property and use, reuse, lease or sell the abandoned property at Lessor's sole discretion. If in Lessor's judgment the abandoned property has insufficient value to justify its use, reuse, lease or sale, Lessor may notify Lessee of Lessor's option not to reuse or sell the abandoned property and Lessee shall, in not less than five (5) business days after receipt of the written notice remove the abandoned property at Lessee's sole expense. If Lessee fails to remove the abandoned property within that time, Lessor may arrange for removal and disposal of the abandoned property and Lessee shall reimburse Lessor the costs thereof within ten (10) days of receipt of an itemized statement of the costs. 2.2.2 Restoration. Before expiration of the Lease or within thirty (30) days following termination of the Lease, Lessee shall restore the Lease Premises to good order, condition and repair, subject however to: (a) ordinary wear and tear, and (b) loss or damage for which Lessee is not liable hereunder. Lessee is not obligated to restore improvements to the Lease Premises once those improvements have been demolished provided their demolition has been approved in accordance with Section 8 of this Lease, nor is Lessee obligated to demolish improvements that have been completed during the term of this Lease or during the term of the Original Lease provided the improvements were approved in accordance with Section 8 of this Lease, and all subject to provisions contained in Section 15.4. (This section 2.2.2 shall survive termination of this Lease.) 3. RENT 3.1 General. For purposes of this Lease, Base Rent and Additional Rent are hereinafter collectively referred to as "Rent." All Rent payments due and owing shall be made by Lessee and shall be made payable to the City of Tustin and delivered to the City of Tustin Finance Director at 300 Centennial Way, Tustin, California, 92780, or to a third party at such other place as Lessor may designate in writing from time to time. 3.2 Base Rent. Lessee shall tender to Lessor as Base Rent the sum of One Dollar ($1.00) per year, which Base Rent shall be due and payable on the Effective Date and upon each anniversary of the Effective Date during which this Lease remains in effect. Lessor acknowledges that Base Rent has been fully paid to the Effective Date of this Lease. 3.3 Additional Rent. In addition to the Base Rent, Lessee shall pay the following direct operating expenses and additional cost reimbursements set forth in this Section 3_3, with all sums payable by Lessee to Lessor being deemed "Additional Rent" for California statutory remedy purposes. 3.3.1 Operating Expenses. Lessee shall be responsible for all operating expenses of the Lease Premises and shall directly pay all charges, impositions, costs and 594733.10 3 expenses of every nature and kind relating to the Lease Premises (the_ "Operating Expenses"), including but not limited to utility costs and all other costs related to the development and operation of the Lease Premises, including without limitation the cost of capital improvements, maintenance, insurance, taxes (if any), interest and penalties on taxes (if any), code compliance, provisions necessary for security, and any costs necessary to comply with the terms, covenants and conditions of this Lease. In addition, Lessee shall pay for or directly perform all protection and maintenance services for the Lease Premises required under this Lease. Any costs incurred by Lessor resulting from Lessee's failure to perform under this Section 3.3.1 shall be a "Cost Reimbursement" obligation under Section 3.3.2. 3.3.2 Additional Cost Reimbursement. All sums payable by Lessee to Lessor under this Lease which are not Base Rent or Operating Expenses shall be deemed a "Cost Reimbursement." A Cost Reimbursement shall include any and all costs incurred by Lessor which (a) specifically are attributable to an action (or inaction) of Lessee under this Lease, (b) constitute a Claim and/or Loss incurred by Lessor (as a result of Lessee's action or inaction) or Lessee's use thereof or action or inaction with respect thereto and/or (c) arise as a result of or are related to Lessee's failure to provide the protection and maintenance services as required by this Lease. Upon incurring any such Cost Reimbursement expense, Lessor shall advise Lessee in writing of such costs and Lessee shall be obligated to pay to Lessor the full amount of the Cost Reimbursement within thirty (30) calendar days of the date of delivery of such invoice for such costs. 3.4 Late Charge. If any payment or any park thereof to be made by Lessee to Lessor pursuant to the terms of this Lease shall become overdue for a period in excess of ten (10) calendar days, then in addition to any other remedies available to Lessor under this Lease or otherwise, Lessee shall pay to Lessor a late charge equal to ten percent of such overdue amount for purposes of defraying the expense incident to handling such delinquent payment, in addition to interest at a rate of one percent per month, compounded monthly, from the date such payment or part thereof was due. 3.5 No Waiver. Nothing herein or in the imposition or acceptance by Lessor of default interest shall be construed as a waiver of any rights of Lessor arising out of any default of Lessee hereunder; the right to collect any such default interest is separate and apart from any rights or remedies of Lessor relating to any such default by Lessee. 3.6 Net Lease. Lessee hereby acknowledges and agrees that this Lease is intended to be a triple net lease to Lessor and, except as expressly stated herein, Lessor is not responsible for any costs, charges, expenses and outlays of any nature whatsoever arising from or relating to the Lease Premises, or the use and occupancy thereof, or the contents thereof or the business carried on therein, and Lessee shall pay all charges, impositions, costs and expenses of every nature and kind relating to the Lease Premises. As set forth below, all costs of maintenance and repair of the Lease Premises, all costs of insuring the Lease Premises, and all Taxes (as that term is defined below) attributable to the Lease Premises shall be paid directly by Lessee. 4. USE SOF LEASE PREMISES 594733.10 4 4.1 Permitted Use of Lease Premises. Lessee may use and occupy the Lease Premises solely for the purposes of maintaining a non-profit, charitable, educational and recreational facility of the Boys' and Girls' Club of Tustin, as shall be chartered in the United States, and other purposes incidental and related thereto. Lessee shall not use or permit said Lease Premises or any part thereof to be used for any other purpose without first obtaining Lessor's written consent. Lessee shall also maintain its tax-exempt organizational status under either Section 501 (c)(3), 501 (a) (9) or other similar provision of the Internal Revenue Code of 1986, as amended, and understands that it shall be required to maintain such status throughout the Tenn of the Lease. 4.2 Compliance with Laws and Regulations. 4.2.1 Lessee covenants and agrees that it shall observe and comply with all laws, orders, regulations, rules, ordinances and requirements now in force, or which may thereafter be in force, of the federal, state, county and city governments, and of all other governmental authorities, applicable to the Lease Premises or Improvements or any part thereof, and all of their departments, bureaus or officials, whether such laws, orders, regulations, rules or ordinances relate to alterations or repairs, to or in and about the Lease Premises or to changes or requirements incident to or as a result of any use or occupation thereof, or otherwise (collectively, the "Governmental Requirements"). Lessee shall pay all costs, expenses, claims, fines, penalties and damages that may in any manner arise out of or be imposed because of failure of Lessee to comply with the provisions of this Section. 4.2.2 Lessee covenants and agrees that it shall comply with all applicable governmental statutes, laws, ordinances, rules, orders and directives, regulations and requirements as applicable of the federal government, state or county government and/or City of Tustin and any all departments and bureaus in connection with its use of the Lease Premises, and shall also comply with all applicable building, electrical, plumbing, and other codes at Lessee's own cost and expense (collectively, the "Governmental Requirements"). Lessee shall neither use nor occupy the Lease Premises or any part thereof, nor knowingly permit the Lease Premises or any part thereof to be used or occupied, for any hazardous, unlawful, or illegal business, use or purpose, nor in any manner as to constitute a nuisance of any kind, nor in any manner inconsistent with or in violation of this Lease or any other present or future legal requirement. 4.3 It is agreed and understood by the Parties hereto that Lessor, in its varied capacity as a municipal corporation, has the authority to enact, adopt or enforce a rule, ordinance, regulation, law or policy which may represent a unique hardship on Lessee. Lessee's performance under this Section shall not be excused to the extent of such hardship, although Lessee retains any applicable administrative remedies available to any party to appeal or request relief from such impositions. In addition, if such hardship is not reasonably surmountable by Lessee, Lessee retains the right to terminate this Lease for such cause. Lessee also agrees not to conduct or permit to be conducted any public or private nuisance thereon, nor to commit or permit to be committed any waste upon the Lease Premises. 4.4 Operating Standards. Lessee covenants and agrees that it shall operate the Lease Premises in accordance with the Lease. Failure to operate in accordance with this Lease may result in termination of this Lease in accordance with the default provisions of the Lease. 594733.10 4.5 Lessee understands and acknowledges that this Lease is not and does not constitute a commitment by Lessor to create any commitment with regard to the ultimate disposal of the Lease Premises, in whole or in part or in any order of priority, to Lessee. 5. SUBLETTING AND ASSIGNMENT 5.1 Lessee shall not cause or pennit, by operation of law or otherwise, any assignment, subletting, encumbrance or transfer of this Lease or any estate or interest therein without the prior written consent of Lessor, and in the absence of such consent shall constitute a default. Any assignment or subletting approved under this section shall not relieve Lessee of any of its obligations or liabilities for the Term of this Lease, and both Lessee and any subsequent assigns and sublessees shall be deemed bound hereunder. Lessor's consent to any specific assignment, subletting or other transfer shall not constitute consent to any further or subsequent assignment, subletting or transfer request from Lessee. 5.2 In the event that Lessee or a successor desires to effect an assignment or sublease, Lessee or such successor shall submit to Lessor the name of the proposed assignee or sublease and such other information as Lessor may reasonably request for the purpose of determining that such assignee or sublessee has the tax-exempt status, compatible public purpose, as well as the capability and resources necessary to carry out its obligations under the proposed assignment or sublease. 6.1 "AS -IS" Lessee's Responsibility/No Representations or Warranties. The Lessee recognizes that Lessor would not lease to Lessee the Lease Premises except on an "AS IS, WHERE IS, WITH ALL FAULTS" basis, and Lessee acknowledges that, except as expressly set forth in this Lease, Lessor has made no representations or warranties of any kind whatsoever, either express or implied in connection with any matters with respect to the Lease Premises or any portion thereof. The Lessee's determination to enter into this Lease constitutes Lessee's agreement that Lessee, in consummating the transactions described in this Lease, is leasing the Lease Premises in an "AS IS, WHERE IS, WITH ALL FAULTS" basis, in its present state and condition and with all faults. The Lessee further acknowledges and agrees that, except as otherwise specifically provided in this Lease, Lessor has not made and does not make and specifically negates and disclaims any representations, warranties, promises, agreements or guaranties of any kind or character, whether express or implied, oral or written, past, present or future, whether by Lessor or any of its agents, elected or appointed officials, representatives or employees, of concerning or with respect to (1) The value of the Lease Property or the income to be derived from the Lease Premises; (2) the existence or nonexistence of any liens, easements, covenants, conditions, restrictions, claims or encumbrances affecting the Lease Premises; (3) the suitability of the Lease Premises for any and all future development, uses and activities which Lessee may conduct thereon; 594733.10 6 (4) the habitability, merchantability or fitness for a particular purpose of the Lease Premises; (5) the manner, quality, state of repair or lack of repair of the Lease Premises; (6) the nature, quality or condition of the Lease Premises including water, soil and geology; (7) the compliance of or by the Lease Premises and/or the Project or its operation with any Governmental Requirement and the Americans with Disabilities Act of 1990.- (8) the manner or quality of the construction or materials, if any, incorporated into the Lease Premises; (9) the presence or absence of Hazardous Materials, including asbestos or lead paint at, on, under, or adjacent to the Lease Premises; (10) the content, completeness or accuracy of the information, documentation, studies, reports, surveys and other materials, delivered to Lessee in connection with the review of the Lease Premises; (11) the conformity of the existing improvements on the Lease Premises if any, to any plans or specifications for the Lease Premises; (12) compliance of the Lease Premises with past, current or future statutes, laws, codes, ordinances, regulations or Governmental Requirements relating to zoning, subdivision, planning, building, fire, safety, health or environmental matters and/or covenants, conditions, restrictions or deed restrictions; (13) the deficiency of any undershoring or of any drainage; (14) the fact that all or a portion of the Lease Premises may be located on or near an earthquake fault line or falls within an earthquake fault zone established under the Alquist-Priolo Earthquake Zone Act, California Public Resources Code Sections 262 1-2630 or within a seismic hazard zone established under the Seismic Hazards Mapping Act, California Public Resources Code, Sections 2690-2699.6 and Sections 3720-3725; (15) the existence or lack of vested land use, zoning or building entitlement affecting the Lease Premises; and (16) any other matters. 6.2 Powers of Lessor. Lessee acknowledges that Lessor is a governmental entity that, in addition to being owner of the Lease Premises, exercises certain police powers, 594733.10 7 taxation powers, and other governmental powers, duties, and authorities over the Lease Premises. This Lease shall not in any way affect the exercise of those powers, duties and authorities. 6.3 Title Insurance. As soon as possible after the Effective Date, if requested by Lessee, Lessor shall provide Lessee, at Lessee's expense, an ALTA lessee's policy of title insurance from a title insurer and in a form reasonably acceptable to Lessee and for a mutually agreeable liability amount, insuring Lessee's Leasehold interest. Lessor and Lessee shall cooperate and execute and deliver all documents necessary for the issuance of such policy. 7. CONSTRUCTION OF IMPROVEMENTS 7.1 Lessee has represented that it desires in the future to construct on the Lease Premises certain Improvements which are not yet defined. 7.2 Basic Concept Drawings. For any Improvements to be made by Lessee to the Lease Premises after the Effective Date (the "Lessee Improvements"), Lessee agrees that it shall prepare and submit for Lessor's review and written approval basic concept drawings and related documents for Lessee Improvements. The Lease Premises shall be improved consistent with the approved basic concept drawings and related documents, except as changes may be approved in writing by both Lessee and Lessor. 7.3 Construction Plans and Related Drawings. Lessee shall cause to be prepared, at Lessee's sole cost, and shall submit to Lessor preliminary and thereafter final constriction plans or other drawings or plans and all related documents pertaining to the Lease Premises (the "Construction Drawings") for Lessor's review and written approval. Such Construction Drawings shall be prepared by licensed professionals selected by Lessee, which licensed professionals shall maintain professional liability insurance covering their professional errors and omissions. (The existence of such professional liability insurance shall in no way limit the Lessee's obligations to indemnify Lessor as otherwise provided herein, nor to provide insurance as otherwise provided herein.) Construction Drawings are hereby defined as those required for, and in sufficient detail to obtain, City of Tustin Land Use Entitlement and building permits for all Lessee Improvements for which permits are required. 7.4 Lessor Approval of Construction Drawings. Subject to the terms of this Lease, Lessor shall have the right of architectural and site planning review of all Construction Drawings including any changes thereto. However, nothing herein shall relieve Lessee of any obligation to submit plans and other documents required for any development permits or building permits, to City departments or other public agencies. Lessor shall approve or disapprove the Construction Drawings within the time frames for normal construction plan check processing established by the City. Any disapproval shall state in writing the reasons therefore and the changes which Lessor requests be made. Lessee shall revise such Construction Drawings and resubmit them to Lessor, and Lessor review and approval process shall recommence. If Lessee desires to make any changes to the Construction Drawings after their approval by Lessor, Lessee shall submit the proposed changes to Lessor for its approval. Lessor shall notify Lessee in writing if Lessor approves or disapproves the proposed change. If written 594733.10 8 notice is not provided within thirty (30) days after submittal of the proposed changes to Lessor, the proposed changes shall be deemed disapproved, unless Lessor provides notice extending the review period in writing. Lessee shall, upon receipt of a notice of disapproval, review such portions of the Construction Drawings as are disapproved and resubmit them to Lessor for review and approval. The approval process may be discontinued temporarily or permanently at any time by Lessee if Lessee elects not to proceed with or to defer its construction or alteration project. If one or more pen -nits are issued and construction commenced, Lessee shall proceed diligently to complete the construction or alteration project. 7.5 Cost of Construction. Lessee shall bear the full cost of planning, designing, and constructing all improvements to the Lease Premises. Lessor has no responsibility pursuant to this Lease for any Improvements to the Lease Premises and nothing herein shall imply, nor be construed to place any such responsibility on Lessor; Lessee shall bear any necessary governmental agency cost of reviewing and approving the plans and submissions of Lessee and for processing applications and issuing grading permits, building permits, occupancy permits and for undertaking inspections and the like, shall be also including all of the customarily required fees and charges imposed by governmental agencies, including but not limited to the City of Tustin, having jurisdiction with respect to the subject construction and alteration activities. 7.6 Conditions of Construction. 7.6.1 Required Licenses and Permits. Before commencement of construction of Lessee Improvements on the Lease Premises, Lessee shall, at its own expense, secure or cause to be secured all licenses and permits which may be required by the City or any other governmental agency affected by such construction. 7.6.2 Lessee shall require its contractors to agree in writing to indemnify Lessor from the contractor's negligence or willful misconduct in the construction of any Lessee Improvements on the Lease Premises and to secure, and require all contractors and subcontractors to secure, Commercial General Liability, Auto Liability insurance against of claims arising from any alleged negligence of Lessee, contractor and its subcontractors during all construction activities. The "City and its council members, commissioners, elected officials, officers, managers and employees" shall be named by endorsement as additional insureds under each such policy maintained by the Lessee and by its contractors and subcontractors. In addition, Lessee and its contractors and subcontractors shall maintain Worker's Compensation insurance during all construction acitivites, and each such insurer shall provide an endorsement to the City waiving the insurers' rights of subrogation against the City and its council members, commissioners, elected officials, officers, managers and employees. 7.6.3 At all times during construction, Lessee shall comply with the provisions contained in Sections 7.6 and 7.7. 7.6.4 Lessee shall comply with all applicable Governmental Requirements, laws and regulations, including City Ordinances. 594733.10 9 7.6.5 Quality of Work and Materials. All work and materials shall be of good quality, and all workers and subcontractors shall be skilled in their trades and shall be duly licensed in such trades as require licenses at all times that services are performed. 7.6.6 Maintenance of Site During Construction. Lessee covenants and agrees that solely at Lessee's expense it shall maintain the Lease Premises during and after any construction and keep the Lease Premises reasonably free from any debris and waste materials, surplus materials, and surplus equipment. 7.6.7 Indemnity. Lessee agrees to defend, indemnify, and hold Lessor harmless from any claims of any variety arising from or related to errors or omissions or willful misconduct by Lessee and its design professionals, contractor(s), subcontractor(s), supplier(s), employees, and agents preparing for, during or as a result of any construction on, about, or beneath the Lease Premises. This section shall survive termination of this Lease. 7.6.8 No Liens or Stop Notices. Lessee shall keep the Lease Premises free of any liens or stop notices; provided that Lessee shall have the right to contest the correctness or validity of any such lien or stop notice if, immediately upon demand of Lessor, Lessee procures and records a lien release bond issued by a corporation authorized to issue surety bonds in California in an amount equal to one and one-half (1 V2) times the amount of the claim of lien. The bond shall meet the requirements of Civil Code Section 3143 and shall provide for the payment of any sum that the claimant may recover on the claim (together with costs of suit, if it recovers in the action). 7.6.9 Completion of Construction. Upon completion of Construction, Lessee shall furnish Lessor with as -built plans and specifications. 7.7 Guaranty and Lien Free Completion of Improvements. 7.7.1 Lessee hereby covenants and agrees to guarantee its performance in and completion of construction of any Lessee Improvements to the Lease Premises. Notwithstanding any consent given by Lessor of Lessee Improvements, Lessee shall be solely responsible for and shall indemnify, hold harmless and protect Lessor, its officers, directors and agents, against any and all claims arising from Lessee's construction of Lessee Improvements, including damage to structures that would preclude completion of Lessee Improvements. 7.7.2 During any period of construction of Lessee Improvements as authorized under this Lease, Lessee shall complete such construction free of any liens and/or stop work notices being placed against the Leased Premise. In the event any lien or stop notice is placed against the Lease Premises as the result of the construction of Lessee Improvements as provided hereunder, Lessee shall take whatever action is necessary to have such lien or stop notice removed within sixty (60) days after Lessee becomes aware of such lien and/or stop notice. Lessee's failure to remove any lien and/or stop notice within such sixty day period shall be considered a material breach and default, and grounds for termination of the Lease. Lessee shall be entitled to bond in the same manner provided for in Section 7.6.8 above. 594733.10 10 7.7.3 Lessee shall be solely responsible for any applicable prevailing wage requirements applicable to the construction, and shall defend and indemnify Lessor against any claims alleging any violations of prevailing wage requirements. 8. ALTERATIONS 8.1 Lessee shall not make alterations to the Lease Premises without Lessee's prior written consent except as may be identified in Section 8.2. "Alterations" shall mean any modification, addition or improvement to the real property or Lessee Improvements that will be provided by Lessee under the provisions of Section 7 either on, at or under the Lease Premises, whether by addition or deletion. It is intended by the Parties that Lessor shall have no obligation, in any manner whatsoever, to fund or complete any Alterations to the Lease Premises. Except with respect to Minor Alterations (as hereinafter defined), Lessee shall process all Alterations, as applicable, consistent with the provisions in Sections 7 and 8. Lessee shall obtain all necessary permits and approvals required by any Federal, State and local law, and comply with all conditions of such permits and approvals. All Alterations (including, without limitation, all Minor Alterations) shall be done promptly and in a good and workmanlike manner and shall be of good quality and class. 8.2 Lessee may from time to time before or after completion of any construction of Lessee Improvements as provided in Section 7, without Lessor's prior approval and without complying with any of the provisions of Sections 7.1 through 7.4 and/or 8.1 hereof (except for the last sentence of said Section 8.1), perform alterations to the real property or Improvements that are non-structural alterations ("Minor Alterations") provided such Minor Alterations individually meet all of the following criteria: (1) Would not require Lessee to apply for and obtain a building permit or any entitlements required by the City Zoning Code for the completion of the Minor Alteration; (2) Would not result in a violation of any provision of this Lease; (3) Would not cost in excess of twenty-five thousand dollars ($25,000); (4) Would not result in substantial change in the character of improvements or the use for which they are intended or in a substantial change in access or major entries to, or public areas on the Lease Premises; (5) Would not involve or result in any change in the exterior of the improvements that materially changes the design of the improvements based on any original approved plan for the Improvements; (6) Would not be of lesser quality or result in the diminution of the value of the Lease Premises; (7) Would not weaken the structural integrity of the Improvements or any portion thereof. 594733.10 11 (8) Lessee shall not, without written consent of Lessor, demolish or remove all or any structural part of the real property or of any improvement located upon the Lease Premises, except any existing improvements on the Lease Premises that are demolished or removed by Lessee in compliance with the provisions of this Lease. 8.3 Notwithstanding anything to the contrary contained herein, Lessee shall have the same rights to make any Alteration required to be made pursuant to any statutory requirements or court order as Lessee's rights to construct the Improvements, subject to Lessee's compliance with the requirements of Sections 7 and 8 and other provisions of this Lease; provided, however, that if Lessor has approval right hereunder with respect to such Alteration, Lessor shall not withhold such approval if the Alteration is being made in strict compliance with the applicable statutory requirement or court order and no alternative means of compliance therewith is available. 8.4 Lessee shall be responsible for compliance with any applicable prevailing wage requirements and shall defend and indemnify Lessor against any claims alleging any violations of prevailing wage requirements. 9. PROTECTION AND MAINTENANCE Lessee, at no cost to Lessor, shall at all times protect and maintain, repair and keep the Lease Premises in a good order and condition (including structural and non-structural conditions), and exercise due diligence in protecting the Lease Premises against damage and destruction by fire and other causes, subject to the applicable provisions of this Lease. Lessee shall promptly make all necessary repairs to the interior and exterior of the Lease Premises and the Improvements, subject to the applicable provisions of this Lease. 10. TAXES AND ASSESSMENTS 10.1 General. Lessee shall pay all Taxes (as hereinafter defined) levied or imposed against the Lease Premises or Lessor or Lessee's interest therein during the Term prior to delinquency. "Taxes" shall mean all real and personal property taxes, assessments and governmental charges, whether federal, state, county or municipal, and whether general or special, ordinary or extraordinary, foreseen or unforeseen, imposed upon the Lease Premises, the Rent, or any possessory interest therein, or on the operation of the Lease Premises, including interest and penalties thereon, if any. Taxes shall not include income taxes, excess profit taxes, franchise taxes, or other taxes imposed or measured on or by the income of Lessor from the operation of the Lease Premises, provided, however, that if, due to a future change in the method of taxation or assessment, any income, profit, franchise or other tax, however designated, shall be imposed in substitution, in whole or part, for (or in lieu of) any tax, assessment or charge which would otherwise be included within the definition herein to the extent of such substitution. There shall be added to Taxes the expenses of any contests (administrative or otherwise) of Taxes incurred during the taxing year, but only to the extent such contests result in a reduction of Taxes for such year or any other year during the Term. Lessee shall pay to the appropriate governmental authority any use, possessory interest, and/or occupancy tax as may be payable and applicable to the Lease Premises). In the event that Lessor is required by law to collect such Taxes, Lessee shall pay such Taxes to Lessor as a Cost Reimbursement within thirty (30) days of 594733.10 12 demand and Lessor shall remit any amounts so paid to Lessor to the appropriate governmental authority. 10.2 Future Taxes. The interest created by this Lease may at any time be subject to property taxation under the laws of the State of California. If property taxes are imposed, the party in whom the possessory interest is vested maybe subject to the payment of the taxes levied on such interest. This notice is included in this Lease pursuant to the requirements of Section 107.6 (a) of the revenue and Taxation Code of the State of California. 10.3 Lessee shall pay the Taxes directly imposed upon it or Lessor (for which Lessee is responsible as set forth above), in accordance with the instructions of the taxing entity; provided, Lessee shall pay the taxes originally imposed upon Lessor, upon Lessor's election, either (i) annually within thirty (30) days after the date Lessor provides Lessee with a written statement setting forth in reasonable detail such Taxes (which statement shall not be provided to Lessee more than sixty days before such Taxes are due), or (ii) monthly in advance based on estimates provided by Lessor based upon the previous year's tax bill. If the Taxes for which Lessee is responsible are paid monthly on an estimated basis as contemplated in Section 10.3(ii) hereof, then Lessor shall provide Lessee with a written annual reconciliation reflecting any adjustment necessary to reconcile the amount of estimated Taxes paid by Lessee to Lessor during the preceding year as compared to the actual Taxes owed for such tax year, and promptly following the delivery of said written reconciliation, an adjusting payment shall be made as may be required of the applicable Party. 10.4 Proration. All Taxes originally imposed upon Lessor and applicable and payable by Lessee with respect to the Lease Premises shall be prorated on a per diem basis for any partial tax year included in the 'Perm. Lessee's obligation to pay Taxes on a prorated basis during the last year of the Term shall survive the termination of this Lease. 10.5 Payment by Lessor. In the event Lessee fails to timely pay any such Taxes for which Lessee is responsible pursuant to this Lease, and such failure continues for a ten day period after said Taxes are due or after the delinquency period, Lessor may, at its option, upon providing a 5 -day written notice to Lessee and opportunity to cure within such 5 -day period, pay any such Taxes together with all penalties and/or interest which may have been added thereto by reason of any such delinquency or failure to pay when due, and may likewise redeem the Lease Premises, or any part thereof, or the buildings or improvements located thereon, from any tax sale or sales. Any such amounts so paid by Lessor shall be immediately paid by Lessee to Lessor as a Cost reimbursement, however, such Cost reimbursement shall be due and paid by Lessee within ten (10) business days of demand. 11. UTILITIES 11.1 During the term thereof, Lessee agrees to pay, when due, and to hold Lessor harmless from any liability for any and all charges and/or assessments for water, sewer, gas, electricity, telephone or other communication services or cable television and all other forms of utility services of every kind and nature used, rendered, or supplied to, upon, or connection with the Lease Premises throughout the Term, including all charges for installation of meters, conduits or other facilities required for such service. Lessee shall indemnify Lessor from and 594733.10 13 defend and hold Lessor harmless against any claim, liability, damage, loss, costs or expense in connection with such charges. 11.2 Existing and Future Easements and Rights of Wu. This Lease is made and accepted and the Lease Premises leased subject to all outstanding easements and rights-of- way for location of any facility over, across, in and upon the Lease Premises or any portion thereof. The Lease shall be subject to the right of Lessor to grant such additional easements and rights of way over, across, in and under the Lease Premises as it shall determine to be in the public interest; provided that any such additional easement or right of way shall not unreasonably interfere with Lessee's then -existing development, operation or use of the Lease Premises consistent with this Lease. Lessor further reserves the right for itself, to grant, transfer, convey, assign, lease, convey in trust, mortgage, hypothecate, or otherwise encumber, the rights hereby excepted and reserved in this Section without notice to, or the necessity of obtaining any consent or approval of Lessee. 12. RIGHT OF ENTRY 12.1 Should Lessor determine Lessee to be deficient in the performance of its obligations under this Lease, in addition to all other available remedies, Lessor may, but shall not be obligated to enter upon the Lease Premises and correct Lessee's deficiencies using Lessor's forces, equipment and materials suitable for such purposes, or in Lessor's discretion, by employing one or more independent contractors; provided that Lessor shall not enter upon the Lease Premises and correct Lessee's said deficiencies, unless and until Lessor has first given Lessee thirty (30) days prior written notice of its intention to do so (during which period Lessee will be entitled to correct any such deficiency or deficiencies). Lessor's costs so incurred, including direct and indirect overhead costs as determined by Lessor, shall be reimbursed to Lessor by Lessee within thirty (30) days of demand thereof, as a Cost Reimbursement pursuant to this Lease. 12.2 Any officers and/or authorized employees of Lessor may, but shall not be obligated to, enter upon the Lease Premises at any time, in case of emergency, and otherwise at all reasonable times for the purpose of inspecting the condition of the Lease Premises and for determining Lessee compliance with the terms and conditions of the Lease, or for any other purpose incidental to the rights of Lessor within the Lease Premises; provided, however, Lessor shall provide not less than forty-eight (48) hours written notice to enter the Premises as described herein except in the case of city police, code enforcement officers, or personnel from the Orange County Fire Authority or other emergency service agency, which shall be provided access at any time without advance notice. 12.3 Entry by the officers, employees, agents or independent contractors of Lessor upon the Lease Premises for the purposes described in Section 11 shall be without prejudice to the exercise of any other rights provided herein or by law to remedy a breach of this Lease. 13. INSURANCE AND INDEMNITY 594733.10 1.4 13.1 Insurance. Lessee shall provide and maintain in full force and effect at its own expense during the Term of this Lease the following insurance covering its operations under this Lease. Such insurance shall be provided with insurers licensed to do business in the State of California, with a rating of at least A VII, according to the latest Best's Key Rating Guide or A -X (if offered by a surplus line carrier that is non -admitted). Evidence of such insurance shall be delivered to Lessor on or before the Effective Date, including provision of certificates of insurance and required insurer endorsements, and evidence of renewal policies and endorsements shall be delivered to Lessor prior to the expiration of each such policy and endorsement. Insurance endorsements (or a copy of the policy, if applicable) shall be provided as evidence of meeting the requirements of this Section. The Insurers shall specifically identify this Lease and shall contain express conditions and an endorsement that Lessor is to be given at least thirty (30) days advance written notice of any material modification in or termination of insurance. (Alternatively, Lessee may provide Lessor with whatever assurance of notice of cancellation to Lessor that an insurer is willing to provide, along with evidence that the full amount of the premium for the full term of each insurance policy has been pre -paid by Lessee.) Such insurance shall include an endorsement that coverages are to be primary to and not contributing with any other insurance maintained by Lessor, and an endorsement shall name Lessor, and its council members, officers, officials, employees, agents and contractors as additional insureds and by an endorsement provide that all losses shall be payable notwithstanding any act or failure to act or negligence of Lessor, or any other person. All insurance shall be maintained on an occurrence basis. 13. 1.1 Commercial General Liability Insurance. Commercial general liability and property damage insurance covering the Lease Premises, contractual, broad form property damage, and bodily injury or death, with a limit of not less than $2,000,000 per occurrence, and $7,000,000 aggregate. Because of the length of the Term, Lessor, at -Lessor's risk manager's sole discretion, shall have the right to reevaluate and raise the amount of required insurance coverage covering the Lease Premises on an annual basis. Lessor shall notify Lessee in writing if additional coverage is required of Lessee. Lessee shall provide the requested coverage in place no later than thirty (30) days after notice provided by Lessor. The general liability policy is to contain, or be endorsed to contain, the following provisions: (1) Lessor and its council members, commissioners, elected officials, officers, managers, employees, and contractors are to be covered as additional insureds as respects liability arising out of use of the Lease Premises. The coverage shall contain no special limitations on the scope of protection afforded to Lessor, its officers, officials, employees, agents or contractors. (2) Lessee's insurance coverage shall be primary insurance as respects Lessor, and their respective officers, officials, employees and contractors. Any insurance or self-insurance maintained by Lessor shall be excess of Lessee's insurance and shall not contribute with it. (Lessee acknowledges that excess and "umbrella" liability insurers are often unwilling to provide endorsements that their policies are primary, and understands that Lessor will not accept an excess or umbrella liability policy to satisfy these 594733.10 15 requirements unless the insurer endorses the policy to be primary insurance as respects Lessor.) (3) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to Lessor, its officers, officials, employees, agents, or contractors. (4) Coverage shall state that Lessee's insurance shall apply separately to each additional insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. (5) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to .Lessor. (Alternatively, Lessee may provide Lessor with whatever assurance of notice of cancellation to Lessor that an insurer is willing to provide, along with evidence that the full amount of the premium for the full term of each insurance policy has been pre -paid by Lessee.) (6) Each insurance policy shall include an endorsement that the Insurer waives any right of subrogation against Lessor which may arise by reason of any activities of Lessee, Lessor or payments under a policy. 13.1.2 Workers Compensation Insurance. Workers' compensation insurance in an amount and form meeting all applicable requirements of the California Labor Code, covering all persons providing services by or on behalf of Lessee and all risks to such persons. The workers' compensation insurance policy is to contain, or be endorsed to contain, the following provisions: (a) "The insurer waives any right of subrogation against the City of Tustin and its council members, commissioners, elected officials, officers, managers and employees, which may arise by reason of any activities of Lessee, Lessor or payments made under this policy." (b) Coverage shall not be suspended, voided, canceled, reduced in coverage or in limits except after thirty (30) days prior written notice by certified mail, return receipt requested, has been given to the Lessor. (Alternatively, Lessee may provide Lessor with whatever assurance of notice of cancellation to Lessor that the insurer is willing to provide, along with evidence that the full amount of the premium for the full term of each insurance policy has been pre -paid by Lessee.) 13.1.3 Builder's Risk Insurance. Commencing upon the construction of any major alterations which includes buildings and structures only and continuing until such time as the applicable major alterations are accepted and detennined complete by Lessor, Lessee shall obtain and. thereafter maintain a builder's risk policy with respect to such improvements, included clauses of property coverage form policies. Such insurance shall be maintained in an amount not less than one hundred percent (100%) of the full insured value of the major alterations. The term "full insured value" as used in this Section shall mean the cost determined 594733.10 16 by mutual agreement by Lessor and Lessee of providing similar major alterations of equal size and providing the same habitability as the major alterations immediately before such casualty or other loss, but using readily -available contemporary components, including the cost of construction, architectural and engineering fees, and inspection and supervision. 13.1.4 Personal Property Insurance. Lessee, at its sole cost and expense, shall maintain fire and extended coverage insurance throughout the term of this Lease on its Trade Fixtures within the Lease Premises from loss or damage to the extent of their full replacement value. 13.1.5 Sexual Misconduct and Abuse Insurance. Lessee, at its sole cost and expense, shall procure and keep in effect at all times during the term of this lease Sexual Molestation and Abuse Insurance, with a minimum limits of $2,000,000 per occurrence and $4,000,000 aggregate. 13.1.6 Other Insurance Requirements. 13.1.6.1 Contractors and Subcontractors. Lessee shall include all of its contractors and subcontractors as insureds under its policies or shall famish separate certificates and endorsements for each contractor and subcontractor. All coverages for contractors and subcontractors shall be subject to all of the requirements stated herein, and Lessee shall cause contractors and subcontractors to deliver evidence of such coverage and endorsements to City prior to commencement of work on the Lease Premises. The limits shall be the same as the City requirements unless the Risk Manager deems otherwise. 13.1.6.2 Failure by Lessee to procure or maintain required insurance shall constitute an event of default if. (a) Lessee fails to cure within ten (10) days after Lessee discovers the failure to maintain or procure the insurance; or (b) Lessee fails to cure within ten (10) days after Lessor delivers notice to Lessee of the failure to maintain or procure the insurance; or (c) a claim or other event potentially subject to coverage under the insurance which Lessee failed to procure or maintain occurs or is brought at a time of such under -insurance or non -insurance. Lessee shall suspend Lessee's operations, including but not limited to construction activities, during any period Lessee or any of its contractors or subcontractors, fails to maintain required insurance in fall force and effect. 13.1.6.3 Verification of Coverage. In addition to completing an Acord form, Lessee shall famish Lessor with original endorsements effecting coverage required by Section 13. The Acord certificates and individual endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be received and approved by Lessor at least fifteen (15) days before the Effective Date, and renewal policies and endorsements shall be received and approved at least thirty (30) days prior to the expiration of each required policy. 13.1.6.4 Damage and Destruction. In the event of damage or loss to the buildings or improvements situated on the Lease Premises, then Lessee shall take all appropriate steps to erect necessary fencing and structures to preclude unauthorized access to the 594733.10 17 Lease Premises and otherwise mitigate hazardous and unsafe conditions within the Lease Premises caused by the damage and destruction. In the event that damage or destruction to the Lease Premises is the result of an event for which insurance coverage is not required hereunder or is in excess of the amount required, Lessee shall have the option to repair the Lease Premises, or if such damage and destruction render the Lease Premises unusable for their intended purposes, to terminate this Lease in accordance with applicable provisions herein by written notice to Lessor. In the event Lessee elects to terminate this Lease under this Section, then in addition to the other requirements set forth in this Lease, including but not limited to the requirements of Section 15.4, Lessee shall be responsible for removing its Trade Fixtures from the Lease Premises including but not limited to all hazardous materials it brought to the Lease Premises, and for reporting, containing, removing and cleaning up any land, air and water pollution resulting from the damage and destruction which is attributable to Lessee's use of the Lease Premises. Such responsibilities will be carried out by Lessee in a timely manner with other applicable provisions of this Lease with due consideration for human health and safety and the protection of the environment, and in any case in compliance with the requirements and deadlines established by law, regulation, or directive from any Federal, State or local environmental or public safety agency. 13.2 Indemnity. Notwithstanding anything to the contrary hereinabove contained, and irrespective of any insurance carried. by Lessee, Lessee shall defend, with counsel acceptable to Lessor, indemnify, protect, and save harmless Lessor and its council members, commissioners, elected officials, officers, managers, employees and contractors (collectively, the "Lessor Indemnitees") from, and shall pay all costs, expenses and reasonable attorney fees for all trial and appellate levels and post judgment proceedings in connection with and from, any and all demands, claims, actions, proceedings, suits, losses, liens, costs, judgments, damages or liabilities of any kind and nature whatsoever, including expenses incurred in defending against legal actions, for death or injury to persons or damage to property and for civil fines and penalties arising, and for any violation or alleged violation of any local, state or federal law or regulation at the Lease Premises, and for any breach of this Lease arising out of, or in connection with, or in any manner predicated upon the use of, occupancy of, and/or operations carried on upon the Lease Premises by Lessee, its officers, officials, employees, agents, servants, guests, invitees, contractors, including the following: (1) Any dangerous, hazardous, unsafe or defective condition, in or on the Lease Premises, or any nature whatsoever, which may exist by reason of any act, omission, neglect, or any use or occupation of the Lease Premises by Lessee, its officers, officials, employees, agents, contractors, subleases, licensees, or invitees from commencement of the term of this Lease; (2) Any operation conducted upon or any use or occupation of the Lease Premises by Lessee, its officers, officials, employees, agents, contractors, employees, sublessees, licensees or invitees under or pursuant to the provisions of this Lease or otherwise; 594733.10 18 (3) Any act, omission, or negligence of Lessee, its officers, officials, employees, agents, design consultants, professional consultants and contractors; (4) The loss of or damage to any property of Lessee by theft or otherwise; (5) Any failure of Lessee, its officers, officials, employees, agents, contractors, subleases or licensee's to comply with the terms or conditions of this Lease, or any applicable federal, state, regional or municipal law, ordinance, rule or regulation related to the use or occupancy of the Lease Premises. 13.3 Lessor shall notify Lessee within thirty (30) days of receiving notice of any claim filed against it that Lessor becomes aware is covered by indemnity in Section 13.2 or elsewhere in this Lease. 13.4 Lessee's Liability Extends to Its Contractors and Sublessees. Lessee's liability shall extend to the performance of major alterations or other Alterations or in use of the Lease Premises by any design consultant, professional consultant, contractor, subcontractor, assignee, sublease or license of Lessee under this Lease. 13.5 Limitation of Indemnities. Notwithstanding anything to the contrary in Section 13.2 above or elsewhere in this Lease, Lessee shall not have any responsibility for indemnifying the Lessor Indemnitees (as defined in Section 13.2 above) or any of them for that Lessor Indemnitee's own gross negligence and/or willful misconduct. 14. NON-DISCRIMINATION, CIVIL RIGHTS AND OTHER PREVAILING COMPLIANCE REQUIREMENTS 14.1 Non -Discrimination and Equal Opportunity. 14.1.1 Lessee covenants and agrees, for itself, each and every Lessor approved assignee and or sublessee and each and every Person claiming by, through or under Lessee, (a) that it shall not discriminate against any employee or applicant for employment on any basis prohibited by law and (b) that it will comply with all applicable provisions of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, and the Age Discrimination in Employment Act of 1975 in the use, occupancy, of the Lease Premises. 14.1.2 Equal Opportunity. Lessee shall provide equal opportunity in all employment practices. Lessee shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. Lessee shall take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to the following: employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination, rate of pay or other forms of compensation and. selection for training, including apprenticeships. Lessee shall post in conspicuous places available, available to employees and applicants for employment, notices setting for the provisions of this non-discrimination. 594733.10 19 14.1.3 Obligation to Refrain from Discrimination. Lessee covenants and agrees for itself, each and every Lessor approved assignee or sublessee and each and every Person claiming by, through or under Lessee, that: 14.1.3.1 No Discrimination. There shall be no discrimination against or segregation of any person, or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin or ancestry in the sublease, assignment, use, occupancy, tenure or enjoyment of the Lease Premises or in construction of improvements on the Lease Premises, nor shall Lessee itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the use or occupancy of Lessee on the Lease Premises or assignees, sublessees, contractors or vendees of Lessee; 14.1.3.2 Deed Restrictions. All leases or contracts shall contain or be subject to substantially the following non-discrimination or non -segregation clauses: In leases: Lessee herein covenants by and for itself, its successors and assigns, and each and every Person claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin or ancestry in the leasing, subleasing, renting, transferring, use, occupancy, tenure or enjoyment of the land herein leased, nor shall Lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of Lessees, sublessees, subtenants, contractors or vendees in the Lease Premises. In contracts: There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin or ancestry in the Lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall Lessee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of Lessees, subtenants, sublessees, contractors or vendees in the Lease Premises. 14.2 Compliance with ADA. Lessee represents, warrants and covenants that Lessee shall conduct its business and maintain the Lease Premises in accordance with any applicable requirements of the American with Disabilities Act of 1990 (the "Act"), as may be amended and with all. other applicable federal, state and local, statutes, rules, regulations and ordinances related to handicap accessibility. 14.3 Prevailing Wage Requirements. Lessee hereby acknowledges and agrees that construction of improvements under the Lease will be subject to applicable Federal and State Labor Laws and requirements and requirements and that they shall be responsible for investigating the applicability of and, if and to the extent applicable, pay prevailing wages for construction of improvements meeting the requirements of State Law, or Davis -Bacon act wages 594733.10 20 required by federal law (for certain federally grant funded construction activities, as applicable), or if both are applicable, meeting the higher of the foregoing requirements. Lessee hereby agrees that it shall be fully responsible for determining whether the foregoing wage requirements are applicable. Lessee agrees to give to Lessor prompt written notice of any violation, potential violation or assertion of non-compliance by Lessee (of which Lessee is or becomes aware), with any of these requirements as identified by the applicable agency overseeing such compliance. As a material part of the consideration for the Base Rent under this Lease, Lessee shall also indemnify, protect, defend and hold harmless Lessor and its council members, commissioners, elected officials, officers, managers, employees and contractors from and against any and all claims or acts or omissions of Lessee in connection with the failure of Lessee or its officers, officials, employees, agents or contractors to comply in construction of improvements or alterations of the Lease Premises with any applicable prevailing wage requirements imposed by State law and/or Federal law, including but not limited to the Davis -Bacon requirements. 15. DEFAULT, CERTAIN REMEDIES, TERMINATION 15.1 Default Notices. 15. 1.1 If Lessee fails to perform any term, covenant or condition of this at any time during the Term and Lessor concludes that Lessee has not complied in good faith with the provisions of the Lease, Lessor shall issue a written "Notice of Default" by certified mail, specifying the grounds thereof and all facts demonstrating such non-compliance. Lessee shall have thirty (30) days after receipt by Lessee of such notice to respond in writing to such notice by either specifying how its non-compliance has been cured or the grounds upon which it believes that it is complying with the Lease. If Lessor has not received a response to the Notice of Default within the prescribed thirty (30) days, or within such later period of time as established by Lessor, the Notice of Default shall be conclusively presumed to be valid and Lessor may commence proceedings on termination of the Lease pursuant to Section 15.2; 15.1.2 If Lessee ceases to operate the Leased Premises for the uses authorized in accordance with this Lease for a period of ninety (90) days or longer or dissolves or is unable to fund its services and programs on the Lease Premises for any consecutive period of ninety (90) days or longer, Lessor may elect, by written notice to Lessee, to terminate the Lease pursuant to proceedings on termination pursuant to Section 15.1.1 above and this Section 15.1.2. The provisions of this Section 15.1.2 shall not be applicable to operating cessations necessitated by reason of (a) an approved construction or alteration of the Lease Premises and/or the Improvements thereon in accordance with the provisions of this Lease, or (b) restoration of the Lease Premises and/or the Improvements thereon in accordance with the provisions of this Lease following condemnation and/or casualty damage or destruction thereof. 15.2 Termination by Lessor. 15.2.1 Notwithstanding any other provisions of this Lease, Lessor, upon the occurrence of a default hereunder by Lessee, which default remains uncured by Lessee after any applicable period to cure a default as provided for in Section 15.1.1 or elsewhere herein or for such longer cure period as may be approved in writing by Lessor shall have the immediate option to terminate this Lease and all rights of Lessee hereunder by giving written notice by 594733.10 21 certified mail of such intention to terminate this Lease in the manner as specified in Section 15. Such written notice of termination shall be effective as of the date specified therein. The remedies set forth in this section shall be in addition to any other remedies available to Lessor at law or in equity. 15.2.2 In the event of termination of this Lease for default, Lessee by signing this Lease hereby waives any and all rights of any type, kind or amount and releases Lessor and City of Tustin against any and all claims Lessee might have under the U.S. or State Constitution or State Law for loss of goodwill, the value of the Leasehold interest and Lease improvements, and relocation assistance, including but not limited to any such or similar rights prescribed by any state, federal or local law or regulation and waiving all rights to just compensation under the U.S. and California Constitutions. 15.3 Termination by Lessee. Lessee shall have the right to terminate this Lease upon thirty (30) days written notice to Lessor by certified mail, return receipt requested, for any reason including, but not limited to the event of damage or destruction of all of the Lease Premises including improvements (including loss of utilities for any reason) on the Lease Premises, or such a substantial portion thereof so as to render the Leased Premise incapable of use for the purposes for which it is leased hereunder. Termination in the event of damage or destruction of Lease Premises or improvements shall be subject to the provisions of Section 15.4. 15.4 Damage or Destruction of the Lease Premises. 15.4.1 Partial Damage. In the event of partial damage to the Lease Premises then Lessee shall be entitled to receive the insurance proceeds from Lessee's policy and attributable to the damage of the Lease Premises and/or payable in connection with any duties or obligations of Lessee- contemplated herein such as restoration, clean-up, debris removal, etc. Lessee shall commence repair to such damage within one hundred and eighty (180) days after such damage or such additional time as may approved in writing by Lessor after such damage to allow time for collection of insurance proceeds, planning for restoration, compliance with Governmental Requirements, procurement of any necessary governmental permits and approvals, engagement of necessary architects, consultants and contractors, and the like, and this Lease shall continue in full force and effect. For good cause, the time to repair may be extended by written agreement of the parties. In the event that the required insurance policy held by Lessee is not in force, or insurance proceeds received by Lessee are not sufficient to effect such repair (e.g., because of deductibles or under -insurance), Lessee shall either: (a) promptly contribute the shortage in proceeds as and when required to complete repairs; or (b) within ninety (90) days after such damage, deliver written notice to Lessor of Lessee's election to terminate this Lease. Such damage shall not extend the Lease Tenn. Lessor shall have no obligation to pay for the shortage in insurance proceeds or to restore the unique aspects of the Lease Premises. In the event Lessee elects to terminate the Lease, Lessee shall, at its sole expense, and within one hundred eighty (180) days after the damage, and subject to such exceptions as the parties may then agree upon in writing: (x) cause all debris and all Improvements, including but not limited to damaged Improvements, to be removed from the Lease Premises; and (y) clean and restore the Lease Premises to a flat and vacant condition, free of debris. 594733.10 22 15.4.2 Total Destruction. In the event that the Lease Premises and/or the Improvements shall be damaged or destroyed by fire or other cause, so as to render the Lease Premises and/or the Improvements incapable of use for the purposes for which they are intended, Lessee may elect whether to: (a) repair the Premises, or (b) to terminate this Lease. Lessee shall notify Lessor in writing of its election within ninety (90) days of such destruction. In the event Lessee elects to repair the Lease Premises, the work or repair shall commence promptly and within one hundred and eighty (180) days after such damage or such additional time as may granted in writing by Lessor, taking into consideration the time needed for Lessee to collect insurance proceeds, plan for restoration, procure any necessary governmental permits and approvals, engage architects, consultants and contractors, and the like, and once begun shall be carried on without unnecessary delay. In the event Lessee elects not to repair the Lease Premises, the Lease shall be deemed terminated within thirty (30) days after receipt by Lessor of Lessee's election not to repair the Lease Premises. In the event Lessee elects to terminate the Lease, Lessee shall, at its sole expense, and within one hundred eighty (180) days after the damage, and subject to such exceptions as the parties may then agree upon in writing: (x) cause all debris and all Improvements, including but not limited to damaged Improvements, to be removed from the Lease Premises; and (y) clean and restore the Lease Premises to a flat and vacant condition, free of debris. Lessee shall be entitled to insurance proceeds under the Lease Premises casualty policy required to -be carried by Lessee pursuant to this Lease, and the Lease is terminated under this Section, Lessee shall. be entitled to the portion of such proceeds attributable to the destruction of the improvements or alterations constructed by Lessee on the Lease Premises and the reasonable cost of performing Lessee's erection and mitigation work contemplated in Section 13.1.5.4, and Lessor shall be entitled to the portion of proceeds attributable to the real property, excluding the value of the land and any cost to demolish and remove any improvements on the Lease Premises, and any amounts to which Lessee is entitled pursuant to the foregoing provisions of this Section 15.4.2. 15.5 Termination b either ither Party as Result of Eminent Domain. In the event that title to the whole of the Lease Premises shall be lawfully condemned or taken in any manner for any public or quasi -public use or conveyed in lieu of condemnation, this Lease shall automatically terminate as of the date possession is required to be delivered to the condemnor. In the event that only a portion of the Lease Premises is taken and the Lease Premises are thereby rendered, in Lessee's reasonable opinion, unsuitable for the conduct of Lessee's business, Lessee may terminate this Lease by giving written notice of such termination to Lessor within ten (10) days after the date when possession of the portion of the Lease Premises so taken is delivered to the condemning authority. Any award for the taking of all or any part of the Lease Premises under the power of eminent domain or any payment made under threat of the exercise of such power shall be property of the Lessor, whether such award shall be made as compensation for diminution in value of the leasehold or for the taking of the fee. In the event of eminent domain initiated by any Federal, State or local agency other than the City of Tustin or the Tustin Redevelopment Agency, Lessee shall be entitled to seek from the condemning authority a portion of the condemnation award for relocation, loss of Lessee's trade fixtures, and severance damages. In the event of any eminent domain, Lessee, by signing this Lease hereby waives any and all rights of any type, kind or amount and releases the City of Tustin (in its capacity as Lessor and in any and all other capacities in which it may act) and the Tustin Community Redevelopment Agency against any and all claims Lessee might have under the U.S. or State Constitution or State Law for the loss of goodwill, the value of the Leasehold interest and Lease 594733.10 23 improvements, relocation assistance, and severence damages, including but not limited to any such or similar rights prescribed by any state, federal or local law or regulation and waiving all rights to just compensation under the U.S. and California Constitutions. 15.6 The following provisions/sections of this Lease shall survive termination: - All indemnification provisions benefitting either party, including but not limited to Section 13.2; and - All provisions in the Lease that establish or entitle a party to remedies for violations of Lease obligations occuring prior to termination; and - Section 3 to the extent of any unpaid Base Rent, Additional Rent or Cost Reimbursement; and - Sections 2.2.1, 2.2.2, 3.4, 3.5, 5, 6.1, 7.6.8, 7.6.9, 7.7 and each of its subsections, 14, 15.2 and each of its subsections, 15.5, 16.1, 16.2, 17.1, 17.2, 17.3, 18, 20, and Section 22 and each of its subsections. 16.1 Ownership of Improvements. The Improvements constructed at any time upon the Lease Premises by or at the expense of Lessee shall be and remain the property of Lessee; provided that upon expiration or earlier termination of the Lease, the Improvements shall become the property of Lessor without any right of Lessee to receive compensation therefor and without any further act required of either Lessor or Lessee (subject, however, to Lessee's right to remove Tenant's Trade Fixtures from the Premises at or before the date of expiration or earlier termination). 16.2 Surrender. On the last day of the Tenn, or upon any earlier termination of this Lease pursuant to the terms hereof, or upon any reentry by Lessor upon the Lease Premises pursuant to Section 15, Lessee shall surrender to Lessor the Lease Premises in good order, condition and repair (except for: (i) reasonable wear and. tear, (ii) loss or damage for which Lessee is not liable hereunder, and (iii) Tenant's Trade Fixtures) and free and clear of all liens and encumbrances (other than (a) those, if any, permitted or otherwise created or consented to by Lessor, and (b) any Leasehold Mortgage permitted in writing by Lessor) and if requested to do so, shall execute, acknowledge and deliver to Lessor such instruments of further assurance as in the reasonable opinion of Lessor are necessary or desirable to confirm or perfect Lessor's right, title and interest in and to the Lease Premises; provided, however, that so long as a leasehold mortgage is in effect, Lessee shall have no right to surrender the Lease Promises (except a, surrender upon the expiration of the Tenn or upon termination by Lessor pursuant to and subject to the provisions of this Lease) and Lessor shall not accept any attempted surrender unless prior written consent of any Leasehold Mortgagee shall have been obtained, 17. LEASEHOLD MORTGAGES 17.1 No Subordination. The fee estate and Lessor's interest under this Lease shall not be subordinate to any Mortgage unless approved in writing by Lessor. 594733.10 24 17.2 Subject to Lease. All mortgages and all renewals, modifications, consolidations, replacements and extensions thereof, shall be subject and subordinate to this Lease. Each Mortgagee shall, as a condition precedent to approval by Lessor, execute such instruments and/or documents as Lessor may request. 17.3 Cross -Collateralization Prohibited. This Lease shall not be cross - collateralized to serve as additional security for any loan by any Mortgage, which is also secured by real property other than the Lease Premises, the improvements thereon, any portion thereof or any interest therein. 18. PAYMENTS AND NOTICES . Any payments or notices to be given or other documents to be delivered by either Party under the terms of this Lease, or any law applicable hereto, must be either personally delivered or placed in a sealed envelope, postage prepaid, addressed to the person on whom it is to be served and deposited in the United States Mail in the State of California, duly certified, with postage pre -paid and return receipt requested, at the following addresses, or such other address as any party may designate by providing notice to the other parties as provided herein. Notices shall be deemed delivered upon the date of personal service, or upon the date of actual delivery as shown in the return receipt if delivery is made by mail: "Lessor" City Clerk City of Tustin 300 Centennial Way Tustin, CA 92780 Copy to: City Attorney Woodruff, Spradlin & Smart 555 Anton Blvd. Suite 1200 Costa Mesa, CA 92626 "Lessee": Chief Professional Officer Boys and Girls Clubs of Tustin 580 West Sixth Street Tustin, CA 92780 19. ESTOPPEL CERTIFICATES 19.1 Lessee shall, upon prior request by Lessor, execute, acknowledge and deliver to Lessor, or to such other persons who may be designated in writing by Lessor, an estoppel certificate as requested by Lessor certifying that the Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications) and, if so, other items requested by Lessor, including the 594733.10 25 Lease Term, Commencement Date, Termination date, and rent amounts and such other matters as requested by Lessor concerning the tenancy of Lessee. 19.2 Lessor shall, upon prior request by Lessee, execute, acknowledge and deliver to Lessee, or such other persons who may be designated in writing by Lessee, an estoppel certificate as requested by Lessee certifying that the Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications) and, if so, other items requested by Lessee, including the Lease Tenn, Commencement Date, the Termination date, and rent matters and such other matters as requested by Lessee concerning the tenancy of Lessee. 20. LIMITATION ON LIABILITY In consideration of the benefits accruing hereunder, Lessee and Lessor covenant and agree, in the event of any actual or alleged failure, breach or default hereunder by Lessor: (a) Lessee's sole and exclusive recourse shall be against Lessor's interest in the Lease Premises and Lessee shall not have any right to satisfy any judgment which it may have against Lessor from any other assets of Lessor; (b) no elected official, commissioner, official, officer, employee, contractor, agent, attorney, beneficiary or trustee of Lessor (each a "Lessor Party') shall be sued or named as a party in any suit or action (except as may be necessary to secure jurisdiction over Lessor and Lessor's interest in the Lease Premises); (c) no service of process shall be made against any Lessor Party (except as may be necessary to secure jurisdiction over Lessor and Lessor's interest in the Lease Premises); (d) no Lessor Party shall be required to answer or otherwise plead to any service of process; (e) no judgment will be taken against any Lessor Party; (f) any judgment taken against any Lessor Party may be vacated and set aside at any time nunc pro tune: (g) no writ of execution will ever be levied against the assets of any Lessor Party; and (h) these covenants and agreements are enforceable by Lessor and also by any Lessor Party. 21. QUIET POSSESSION Upon Lessee paying the Rent and the other sums due hereunder and observing and performing all the covenants, conditions, terms and provisions on Lessee's part to be observed and performed hereunder, Lessee shall have quiet possession of the Lease Premises for the Term hereof, subject to all provisions of this Lease. 22. GENERAL PROVISIONS 22.1 Consent to Jurisdiction and Applicable Law. The Parties hereto agree that all actions and proceedings arising in connection with this Lease shall be tried and litigated exclusively in the Superior Court of the County of Orange, State of California, in any other appropriate court of that county, or in the United States District Court for the Central District of California. This choice of venue is intended to by the Parties to be mandatory and not permissive in nature. The Lease shall be governed by, interpreted under, construed and enforced in accordance with the laws of the State of California, irrespective of California's choice -of -law principles. 594733.10 26 22.2 Entire Agreement, Waivers and Amendments. This Lease constitutes the entire understanding and agreement of the Parties with respect to the matters set forth in this Lease. This Lease supersedes all negotiations and previous agreements and leases between the Parties respecting the subject matter of this Lease, including but not limited to the Original Lease and its amendments. No amendment, change, modification or supplement to this Lease shall be valid and binding on any of the Parties unless it is signed by the appropriate and authorized signatories of Lessee and Lessor. 22.3 Construction and Interpretation of Lease. 22.3.1 The language in all parts of the Lease shall in all cases be construed as simply, as a whole and in accordance with its fair meaning and not strictly for or against any Party. 22.3.2 If any term or provision of the Lease, the deletion of which would not adversely affect the receipt of the material benefit by any Party hereunder, shall be held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of the Lease shall not be affected thereby and each other term and provision of the Lease shall be valid and enforceable to the fullest extent permitted by law. 22.3.3 Any captions of the sections of subsections in this Lease are inserted solely for convenience and reference only and shall not define, explain, modify, construe, limit, amplify or aid in the interpretation, construction or meaning of any of the provisions of the Lease. 22.3.4 As used in this Lease and as the context may require, the singular includes the plural and vice versa and the masculine gender includes the feminine and vice versa; the words "include" and "including" mean respectively "include, without limitation" and "including, without limitation," and: "shall" be mandatory and "should" and "may" are permissive. 22.4 Covenant of Cooperation. The Parties shall cooperate with each other, deal with each other in good faith and assist each other in the performance of the provisions of this Lease. In the event of any legal action instituted by a third party or other governmental entity or official challenging the validity of any provision of this Lease, the Parties agree to cooperate in defending such action to the extent permitted by law. 22.5 No Partnership/Joint Venture. Nothing contained in this Lease shall be deemed or construed to create a partnership, joint venture, joint enterprise or any other relationship between the Parties hereto other than Lessor and Lessee according to the provisions contained in this Lease, or cause Lessor to be responsible in any way for the debts or obligations of Lessee. 22.6 No Waiver. The failure of Lessor to see redress for violation of, or to insist upon the strict perforinance of, any covenantor condition of this Lease shall not be deemed a waiver by Lessor of its rights to such redress for a prior, concurrent, or subsequent violation of the same or any other covenant or condition of this Lease. The receipt by Lessor of any Rent or other Cost Reimbursements required of Lessee with knowledge of any preceding breach by 594733.10 27 Lessor of any covenant, term or condition of this Lease shall not be deemed to have been waived by Lessor. 22.7 Force Majeure Delays. If either Party shall be delayed or prevented froth performance of any act required by this Lease by reason of acts of God, blockades, rebellion, war, insurrection, acts of terrorism, strikes or lockouts, freight embargo, inability to procure materials, unusually severe weather, reasonably unforeseeable physical condition of the Lease Premises including the presence of Hazardous Materials, fire, earthquake or other casualty, or other cause, without fault and beyond the reasonable control of the Party obligation (financial inability excepted), performance of such act shall be excused for the period of delay, and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay; provided however, that if any Party ("First Party') believes that an extension of time is due to Force Majeure Delay, it shall notify the other Party (the "Second Party") in writing within at least thirty (30) days from the date upon which the First Party becomes aware of such Force Majeure Delay, describing the Force Majeure Delay, when and how the First Party obtained knowledge thereof, the date the event commenced, the steps the First Party anticipates taking to respond to such Force Majeure Delay, and the estimated delay resulting from such Force Majeure Delay and response. The extension of Force Majeure Delay shall be granted or denied in the Second Party's reasonable discretion. If the Second Party's decision with respect to such request is disputed by the First Party, the matter may be resolved in accordance with Section 22.1 hereof. If the First Party fails to notify the Second Party in writing of its request for Force Majeure pursuant to this Section, there shall be no extension for such Force Majeure Delays. Nothing in this Section shall excuse Lessee from prompt payment of rent or other Cost Reimbursements required by Lessee except as may be expressly provided elsewhere in this Lease. 22.8 Binding Effect. This Lease and its terms, provisions, promises, covenants and conditions hereof shall be binding upon and shall inure to the benefit of the Parties hereto and their respective heirs, legal representatives, and any successors and assigns approved in writing by Lessor. 22.9 Counterparts. This Lease may be executed. in two or more separate counterparts, each of which when so executed shall be deemed to be an original. Such counterparts shall, together, constitute and shall be one and the same instrument. The Lease shall not be effective until execution and delivery by the Parties of at least one full set of counterparts. 22.10 Memorandum of Lease. The Parties shall execute and record a Memorandum of Lease in a form and content attached hereto as Exhibit B. IN WITNESS WHEREOF, Lessor has, by action of the City of Tustin City Council, authorized this Lease to be executed for and on behalf of the City of Tustin, and Lessee has caused the same to be executed by its duly authorized officer on the date first above written. "LESSOR" CITY OF TUSTIN, CALIFORNIA 594733.10 28 Dated: By: Dr. Allan Bernstein, Mayor APPROVED AS TO FORM ATTEST: Woodruff, Spradlin & Smart o David Kendig City Attorney 594733.10 29 Erica Rabe City Clerk "TENANT" BOYS'AND GIRLS' CLUB OF TUSTIN • RIO Name: Its: M. Name: Its: 594733.10 30 EXHIBIT "A" LEASE PREMISES LEGAL DESCRIPTION Real property in the City of Tustin, County of Orange, State of California, described as follows: PARCEL 2, AS SHOWN ON EXHIBIT "B" OF THAT CERTAIN "APPLICATION FOR LOT LINE ADJUSTMENT NO. 83-1" RECORDED AUGUST 22, 1983 AS DOCUMENT NO. 83- 366230 OF OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNIA. APN: 401-341-06 WTIVA1911111 CITY OF TUSTIN OFFICIAL BUSINESS REQUEST DOCUMENT TO BE RECORDED AND TO BE EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE 6103 .AND 27383. Recording requested by and when recorded mail to: City Clerk The City of Tustin 300 Centennial Way Tustin, CA 92780 1*114901 MEMORANDUM OF LEASE This MEMORANDUM OF LEASE ("Memorandum of Lease") is made as of 2017 ("Lease Effective Date") by and between the CITY OF TUSTIN, a municipal corporation of the State of California (the "City" or "Lessor"), and the BOYS' AND GIRLS' CLUB OF TUSTIN, a non-profit, charitable California corporation ("Tenant") to confirm that the City and Tenant have entered into that certain Lease dated as of the Lease Effective Date affecting the real property described below. Properly Affected by the Lease. 1.1 The "Lease Premises" affected by the Lease is located in the City of Tustin, County or Orange, California which land is legally described as set forth in Attachment A. 1.2 All terms, covenants, conditions, restrictions and obligations set forth in the Lease are incorporated herein by this reference as though fully set forth. 2. Public Documents. The documents constituting the Lease are public documents and may be reviewed at the official offices of the City. 3. Interpretation; Notice. This Memorandum of Lease is prepared for recordation and notice purposes only and in no way modifies the terms, conditions, provisions and covenants of the Ground Lease. In the event of any inconsistency between terms, conditions, provisions and covenants of this Memorandum of Lease, the terms, conditions, provisions and covenants of the Lease shall prevail. IN WITNESS WHEREOF, the City and the Tenant have signed this Memorandum of Lease as of the Lease Effective Date. 90307:6391301.3 -2- 594733.10 "LESSOR" CITY OF TUSTIN, CALIFORNIA By: Dr. Allan Bernstein, Mayor ATTEST: Dated: Erica Rabe City Clerk APPROVED AS TO FORM Woodruff, Spradlin & Smart David Kendig City Attorney "TENANT" BOYS' AND GIRLS' CLUB OF TUSTIN Name: Its: Name: Its: 90307:6391301.3 -3- 594733.10 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 ) ss. COUNTY OF ORANGE ) On 20 before me, (here insert name and title of officer), 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 signature(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 State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. SEAL) NOTARY PUBLIC SIGNATURE 594733.10 MEMORANDUM OF LEASE - ATTACHMENT A Legal Description of Lease Premises Real property in the City of Tustin, County of Orange, State of California, described as follows: PARCEL 2, AS SHOWN ON EXHIBIT "B" OF THAT CERTAIN "APPLICATION FOR LOT LINE ADJUSTMENT NO. 83-1" RECORDED AUGUST 22, 1983 AS DOCUMENT NO. 83- 366230 OF OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNIA. APN: 401-341-06 594733.10 KIDS currently registered for 2017�����+ 688 kids registered in 2016 817 kids registered in 2015 2017 AVERAGE DAILY ATTENDANCE Summer 2017 - 202 kids School year 2016- 205 kids IN TRANSPORTATION PROGRAM School year 2016: 16o kids, School year 2015: 15o kids wwo'NEWOMi NUMBER OF TUSD SCHOOLS WITH PICKUPS/DROPOFFS The Tustin BGC transports kids to and from school every day