Staff Reportt °wN F MEETING DATE: 06/16/15
ITEM NO:
Mpg GASOS COUNCIL AGENDA REPORT
DATE: JUNE 4, 2015
TO: MAYOR AND TOWN COUNCIL
FROM: LES WHITE, INTERIM TOWN MANAGE l
SUBJECT: AUTHORIZE THE INTERIM TOWN MANAGER TO EXECUTE A LEASE
AGREEMENT BETWEEN THE TOWN OF LOS GATOS AND THE FRIENDS
OF THE LOS GATOS PUBLIC LIBRARY
RECOMMENDATIONS:
Staff recommends that the Town Council authorize the Interim Town Manager to execute a lease
agreement between the Town of Los Gatos and the Friends of the Los Gatos Public Library.
BACKGROUND:
The Friends of the Los Gatos Public Library is an all - volunteer organization with a long history
of supporting the Library through volunteerism and fundraising efforts. Between 2012 and 2015,
the Friends contributed $1.8 million toward the furniture, fixtures and equipment in the new
Library and more than $110,000 toward Library programming and services. These contributions
significantly enhance the Library's children's and adult programming, special collections and
related services.
The relationship with the Friends is extremely beneficial to the Library and the community. All
of the money earned by the Friends goes to support the Library.
The Friends originally occupied the former children's library space to sell used books in April of
2012. At that time, the store was open on Sundays only. In October 2012, the store hours were
expanded to Tuesdays, Thursdays, and Sundays. In December 2012, the store expanded hours to
four days per week, adding Saturdays. In September 2013, the store opened for five days per
week, adding Friday hours.
PREPARED BY: HEIDI MURPHY c� "1 6
Town Librarian c-
Reviewed by: Assistant Town Manager own Attorney
NAMGRWdminWorkFiles\2015 Council ReportsVme 16\Friends1easeStaffReport.doc
PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: LEASE AGREEMENT BETWEEN THE TOWN OF LOS GATOS AND THE
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
JUNE 4, 2015
DISCUSSION:
On October 14, 2013, the Town entered into a ten -year lease agreement (Attachment 1) with the
Friends of the Los Gatos Public Library for the use of 1,860 square feet at 108 E. Main St. for
retail book sales. The lease terms specified that the Friends were accepting the building "as -is."
At that time, the building was in an operable condition, with furniture and shelves to be used for
the bookstore. The lease did not specify terms for the closure of the building.
Since the bookstore closed for remodeling in late October 2014, expenses related to book sales
have begun to outpace the income from book sales. The additional costs to remodel the space
have added to the disparity between book sale income and expenses. Remodel expenses are
expected to total approximately $98,000 before the bookstore reopened to the public on June 6,
2015.
In FY 2012/13, the Friends organization made a profit of $48,525 on book sales. In FY 2013/14,
the profit was $58,332. The anticipated revenue for 2014/15 is negative $75,000, due to
decreased income and remodeling expenses. The following graph shows the Friends of the Los
Gatos Public Library's income and expenses as related to book sales for FY 2012/13, 2013/14,
and 2015/16 (through April 2015).
w,
Boo are
e model
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20p
as,000
I9,OOD
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ore N< .
On June 2, 2015, the Town Council met in closed session pursuant to real property lease
negotiations and gave direction to staff on negotiating a new lease with the Friends of library
based upon above described circumstances.
PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: LEASE AGREEMENT BETWEEN THE TOWN OF LOS GATOS AND THE
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
JUNE 4, 2015
DISCUSSION (con'td):
The proposed new lease agreement (Attachment 2) has four major elements that are mutually
beneficial to the Town and the Friends:
No funding commitment for FY 2014/15 and a funding commitment of $35,000 for each
fiscal year of the agreement.
• Funds paid by the Friends of the Los Gatos Public Library through the funding
commitment will be used as enhancements to the Library budget and are not intended to
offset the General Fund contributions to the Library budget.
• The Friends Bookstore is allowed to be open after Library hours on Sundays during
Music in the Park.
Staff has discussed these terms with the leadership of the Friends Board of Directors and they
have indicated support for the proposed lease agreement.
CONCLUSION:
Staff recommends that the Town Council authorize the Interim Town Manager to execute a lease
agreement between the Town of Los Gatos and the Friends of the Los Gatos Public Library
(Attachment 2). The Friends of the Los Gatos Public Library have been strong supporters of the
Library for decades and the proposed lease agreement would help the Friends to continue to
build upon their book sale success and continue that support.
ALTERNATIVES:
As an alternative to approving the recommendations listed above, the Town Council could
choose to:
A. Keep the lease agreement as it is currently written and pro -rate the funding commitment
for FY 2014/15 to $20,833 (the equivalent of a seven month reduction for the
construction period of November 2014 to May 2015), or
B. Renegotiate the terms of the lease based on Council direction, or
C. Terminate the lease with a 90 day notice per the existing lease agreement.
Staff is not recommending any of these alternatives because the proposed lease agreement is a
fair arrangement for both the Town and the Friends.
ENVIRONMENTAL ASSESSMENT:
The lease agreement is not a project defined under CEQA, and no further action is required.
PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: LEASE AGREEMENT BETWEEN THE TOWN OF LOS GATOS AND THE
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
JUNE 4, 2015
FISCAL IMPACT:
If the Council authorizes the Interim Town Manager to execute the proposed lease agreement,
the Friends will not make a funding contribution in FY 2014/15. This will have a $50,000
negative impact on the General Fund Budget, which will be covered by year end savings. The
anticipated $55,000 from this lease agreement has been incorporated into the pending 2015/16
budget, and will be adjusted to $35,000.
Attachments:
1. Existing Lease Agreement between the Town of Los Gatos and the Friends of Los Gatos
Public Library
2. Draft Lease Agreement between the Town of Los Gatos and the Friends of Los Gatos Public
Library
Distribution:
Henry Bankhead
Heidi Murphy
Toni Blackstock
Marlene Rodman
Stephen Conway
CLERK l)EPAI21 iYli.:VI'.
LEASE AGREEMENT
BETWEEN REQ___ __ -- -
TOWN OF LOS GATOS zasO,_ _
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBARY
TABLE OF CONTENTS
LEASE PROVISIONS
1. PREMISES .......................................................................................... ..............................1
2. TERM .................................................................................................. ............................... 1
3. RENT .................................................................................................. ............................... 2
4. FUNDING COMMITMENT ............................................................ ............................... 2
5. USE OF PREMISES and OPERATING HOURS .......................... ............................... 2
6. [reserved] ........................................................................ ............................... ........... 4
7. UTILITIES AND OPERATING EXPENSES ................................. ............................... 4
8. TAXES ................................................................................................. ..............................5
9. MAINTENANCE ................................................................................ ..............................5
10. TENANT IMPROVEMENTS .......................................................... ............................... 6
11. ALTERATIONS BY LESSEE .......................................................... ............................... 7
12. HOLD HARMLESS! INDEMNIFICATION .................................... .............................. 7
13. DAMAGE, DESTRUCTION AND TERMINATION .................... ............................... 7
14. SIGNS .................................................................................................. .............................11
15. ASSIGNMENT AND SUBLETTING .............................................. .............................11
16. DEFAULTS; REMEDIES ............................................................... ............................... 12
17. INTEREST ON PAST -DUE OBLIGATIONS .............................. ............................... 14
18. HOLDING OVER .............................................................................. .............................14
19. TOWN'S ACCESS ............................................................................ .............................14
20. INSURANCE .................................................................................... ............................... 14
21. EMINENT DOMAIN ...................................................................... ............................... 15
22. DISPUTE RESOLUTION.
15
23. NON- LI.ABILITY OF OFFICIALS AND EMPLOYEES OF THE TOWN............ 16
ATTACHMENT 1 Page i of ii
24. NON- DISCRIMINIATION .............................................................. .............................15
25. INDEPENDENT CONTRACTOR ................................................... .............................16
26. CONFLICT OF INTEREST ............................................................. .............................16
27. MEMORANDUM OF LEASE ....................................................... ............................... 17
28.
ESTOPPEL CERTIFICATE ............................................................ .............................17
...............................
29.
LIENS .................................................................................................
.............................17
.............................20
30.
VACATING ........................................................................................
.............................17
31.
ABANDONMENT .............................................................................
.............................17
.............................20
32.
NOTICES ...........................................................................................
.............................18
.............................20
33.
TIME ...................................................................................................
.............................18
...............................
34.
AMENDMENTS ................................................................................
.............................18
35.
SIGNING AUTHORITY .................................................................
...............................
18
36.
CAPTIONS .........................................................................................
.............................18
37.
SURRENDER OF LEASE NOT MERGER ...................................
.............................19
38.
INTEGRATED DOCUMENT ........................................................
...............................
19
39.
WAIVER .............................................................................................
.............................19
40. INTERPRETATIONS.
41. SEVERABILITY CLAUSE.
19
19
42.
GOVERNING LAW ........................................................................
...............................
19
VENUE
.............................20
43.
................................................................................................
44.
COMPLIANCE WITH LAWS .........................................................
.............................20
45.
BROKERS ..........................................................................................
.............................20
46.
ATTACHMENTS TO LEASE .......................................................
...............................
20
EXHIBITS
A DESCRIPTION OF SUBJECT PREMISES ..................................... ............................... 22
B STANDARD INSURANCE REQUIREMENTS ............................... ............................... 23
Page ii of ii
LEASE AGREEMENT
BETWEEN
TOWN OF LOS GATOS
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
+n
This lease agreement (herein "Lease ") is made and entered into this _j q ' dayof
by and between the Town of Los Gatos, a California municipal corporation (herein "Town ") and
Friends of the Los Gatos Public Library, a California nonprofit corporation (herein "Lessee "). Town
and Lessee maybe referred to individually as a "Party" or collectively as the "Parties" or the "Parties
to this Lease." The Town Manager serves as Contract Administrator for this Lease on behalf of the
Town Council.
In consideration of these recitals and the following covenants, terms, and conditions, Lessee and
Town mutually agree as follows:
LEASE PROVISIONS
1. PREMISES.
Town hereby leases to Lessee, certain real property located in the Town of Los Gatos, County of
Santa Clara, State of California, commonly known as 108 E. Main Street (herein the "Premises ") and
more particularly described in Exhibit A attached hereto and incorporated herein by reference. The
Premises consists of approximately one thousand eight hundred and sixty (1,860) square feet of
space for retail book sales. Unless specifically provided, Lessee accepts the Premises "as -is" on the
date of execution of this Lease.
2. TERM.
2.1 Original Tenn. The term of this Lease shall be for ten ('10) years, commencing on July
1, 2013 ( "Delivery Date ") and ending on June 30, 2023. Lessee shall, at the expiration of the
term of this Lease, or upon its earlier termination, surrender the Premises in as good
condition as it is now at the date of this lease. The Parties expect reasonable wear and tear.
2.2 Option to Extend. Provided Lessee is not in default hereunder, either at the time of
exercise or at the time the extended term commences, Lessee shall have the option to extend
the initial term of this Lease for two (2) additional periods of five (S) years ( "Option Period ")
with the same terms, covenants and conditions provided herein, except that upon such
renewal the Funding Commitment due hereunder shall be adjusted pursuant to Paragraph 4.
Lessee's option shall be exercised by Lessee providing Town with request for an extension in
writing no less than sixty (60) days prior to the expiration of the then current term.
2.3 Early Termination by Town. If Town in its sole discretion detennines that it requires
the Premises for any public purpose, Town may terminate this Lease upon ninety (90)
Rev. May 2013
days written notice.
RENT.
3.1 Base Rent. The rent to be paid by Lessee shall be in the amount of One Dollar ($1.00)
per year.
3.2 Payment Date. Rent shall be payable on the first day of July commencing on the
Delivery Date, and each July 1" thereafter during the term of the Lease and any Lease
extension at Town Hall Finance Department.
4. FUNDING COMMITMENT.
4.1 Lessee shall be obligated to pay to Town on an annual basis the following amounts based
on proceeds from the Lessee's efforts to support the Town of Los Gatos Public Library as established
in Lessee's Library Trust Fund account. All payments shall be made payable to the Town quarterly
on the following dates: September 30th, December 31 ", March 31� , and June 30`h.
Year 1: Net proceeds (after paid actual expenses) from all sales of Lessee
Year 2:
$50,000
Year 3:
$55,000
Year 4:
$60,000
Year 5:
$65,000
Year 6:
$70,000
Year 7:
$75,000
Years 8 -10: $75,000 per year
4.2 increase in Funding. Funding commitment of $75,000 shall be required each year during
any Option Periods. Prior to renewal of the Lease under the Option Periods of this Lease, if
the options are exercised, the Town reserves the right to review the accounts and financial
records of the Lessee and open negotiations for potential increased funding.
4.3 Renortine. Lessee shall be obligated to provide to Town Manager an annual audited
financial statement within five days of completion of such report and provide quarterly
performance reports to Town Manager in a timely manner.
5. USE OF PREMISES and OPERATING HOURS.
5.1 Required Uses. Throughout the term of this Lease, Lessee shall provide the following
uses, services and activities ( "Required Uses "):
5. 1.1 Uses consistent with Lessee's business purposes which includes retail sales of
used and new books, ancillary items (cards, t- shirts, paper, and similar products), and
museum merchandise.
Rev. May 2013
5.1.2 1,860 square feet of space on the upper level of the old Town of Los Gatos
Library located at 108 Main Street, Los Gatos, CA, as shown on Exhibit A.
5.1.3 Meeting rooms for public use consistent with current purposes of the Friends
of the Library maybe reserved in accordance with Town policies at cost. Lessee may request
to reserve the conference room in the new public library and the outdoor Town deck adjacent
to Lessee's space in accordance with policies that will be adopted.
5.2 Hours of Operations.
5.2.1 Public Hours. The Premises shall be closed to the Public on Wednesdays.
Public hours on all other days shall be established to conform to hours of existing Los Gatos
Public Library and, will be modified to conform to schedule changes made by the Los Gatos
Public Library in the future. In no event shall the Premises be available to the Public when
the Los Gatos Public Library is closed, including weekdays, weekends and holidays. The
Premises shall be closed during all Town events scheduled at the Civic Center unless the
Lessees is an approved participant in the event or authorized by the Town to remain open.
5.2.3 Staff Hours. The Premises shall remain closed and unavailable to all operations
and staff on Wednesdays prior to 1:00 p.m. The Premises shall be available to Lessee staff
otherwise during regular Town Hall and Los Gatos Public Library business hours.
5.2.4 Special Events. Lessee shall be obligated to apply for the Permit in accordance
with Town rules and regulations and pay all associated costs and fees for any event that
meets the criteria set forth by Town Code. Alcohol (beer & wine only) may be allowed in
conjunction with approval of a Special Events Permit, subject to all regulations required by
the Los Gatos Police Department. For those events that do not meet the criteria requiring a
Special Event Permit, but do impact parking at the Civic Center, Lessee shall coordinate with
the Town Manager's office to avoid conflicts during business hours or when Town events or
meetings are scheduled.
5.3 Prohibited Uses. Lessee shall not use Premises for any purpose not expressly permitted
hereunder. Lessee shall not create, cause, maintain or permit any nuisance or waste in, on, or
about the Premises, or permit or allow the Premises to be used for any unlawful or immoral
purpose. Lessee shall not do or permit to be done anything in any manner which
unreasonably disturbs the users of the Town Property or the occupants of neighboring
property. Specifically, and without limiting the above, Lessee agrees not to cause any
unreasonable odor, noise, vibration, power emission, or other item to emanate from the
Premises. No materials or articles of any nature shall be stored outside upon any portion of
the Premises. Lessee will not use Premises in a manner that increases the risk of tire, cost of
fire insurance or improvements thereon. No unreasonable sign or placard shall be painted,
inscribed or placed in or on said Premises; and no tree or shrub thereon shall be destroyed or
removed or other waste committed of said Premises. No bicycles, motorcycles, automobiles
3 Rev. May 2013
or other mechanical means of transportation shall be placed or stored anywhere on the
Premises. No repair, overhaul or modification of any motor vehicle shall take place on the
Premises or the street in front of said Premises. Lessee, at his /her expense, shall keep the
Premises in as good condition as it was at the beginning of the terms hereof, except damage
occasioned by ordinary wear and tear, and except damage to the roof, sidewalks and
underground plumbing, which is not the fault of Lessee.
5.4 Condition, Use of Premises. Town makes no warranty or representation of any kind
concerning the condition of the Premises, or the fitness of the Premises for the use intended
by Lessee, and hereby disclaims any personal knowledge with respect thereto, it being
expressly understood by the parties that Lessee has personally inspected the Premises, knows
its condition, finds it fit for Lessee's intended use, accepts it as is, and has ascertained that it
can be used exclusively for the limited purposes specified in Section 5.1.
5.5 Parking. Lessee shall be obligated to purchase Olive Zone parking permits annually from
Town for all employees and shared permits for volunteers working over 20 hours or more on
weekdays. Lessee's employees and volunteers will comply with the same parking
requirements consistent with Town employees.
5.6 Coordination with Town. Lessee shall schedule, attend, and fully participate in quarterly
meetings with Town Manager and /or Manager's designee to address any and all conditions of
this Agreement or any other matter which arises in conjunction with the use of the Premises.
Lessee shall also be required to participate in Town Emergency Preparedness training and
exercises.
6. [reserved]
7. UTILITIES AND OPERATING EXPENSES.
7.1 Lessee Obligations. Lessee at Lessee's sole expense shall fully and promptly pay for all
expenses associated with the operation of the Premises, including but not limited to the
furnishing of gas, water, sewer, electricity, telephone service, garbage pickup and disposal,
other public utilities and custodial service. Lessee shall be obligated to pay a pro -rated share
based on square footage for gas, water, sewer, electricity, garbage service and other public
utilities provided by or through the Town. Lessee shall be obligated to pay their own direct
costs for telephone, technology, audio - visual, custodial or other specialized services,
including any initial costs for those services. Town shall maintain all exterior landscaping.
7.2 Custodial Services. Lessee at Lessee's sole expense shall fully maintain and pay for all
custodial services to maintain the interior premises in a clean and safe manner. All vendors
for custodial services shall be bonded, insured, and the Town named as an additional insured.
Proof of bond and insurance including the additional insured certificate shall be provided to
Town prior to any custodial services being performed.
4 Rev. May 2013
8. TAXES.
8.1 Payment of Real Property Taxes. Town shall pay Lessee's share of all real property taxes
which become due and payable.
8.3 Revenue and Taxation Code. Lessee specifically acknowledges it is familiar with section
107.6 of the California Revenue and Taxation. Code. Lessee realizes that a possessory
interest subject to property taxes may be created, agrees to pay any such tax, and hereby
waives any rights Lessee may have under said California Revenue and Taxation Code section
107.6.
8.4 Personal Property Taxes. Lessee shall pay before delinquent, or if requested by Town,
reimburse Town for, any and all taxes, fees, and assessments associated with the Premises,
the personal property contained in the premises and other taxes, fees, and assessments
regarding any activities which take place at the Premises. Lessee recognizes and understands
in accepting this Lease that its interest therein may be subject to a possible possessory
interest tax that Town or County may impose on such interest and that such tax payment shall
not reduce any rent due Town hereunder and any such tax shall be the liability of and be paid
by Lessee.
9. MAINTENANCE.
9.1 Town and Lessee Responsibilities. Lessee at Lessee's expense, shall perform all interior
maintenance and repairs, including all painting, necessary to keep the Premises in first -class
order, repair, and condition, and shall keep the Premises in a safe, clean, wholesome, and
sanitary condition to the complete satisfaction of Town, and in compliance with all
applicable laws, throughout the term of this Lease. In addition, Lessee shall maintain, at
Lessee's expense, all equipment, furnishings and trade fixtures upon the Premises required
for the maintenance and operation of first -class public services of the type to be conducted
pursuant to this Lease. Routine interior plumbing and electrical maintenance (e.g., plugged
toilets /sinks, faulty switches /lights) will be the responsibility of the Lessee. Town shall be
responsible for the routine maintenance and repair of the exterior structure of the Premises
and main support systems, including roof repair, exterior painting and structural repairs,
excluding any maintenance or repairs resulting from Lessee's actions or activities. Eternal
windows broken or cracked from the exterior will be the responsibility of the Town,
excluding broken windows resulting from Lessee's actions or activities, while windows
broken from the interior will be the responsibility of the Lessee; when the source or cause of
breakage is indeterminate, the costs will be shared.
9.2 Waiver of Civil Code. Lessee expressly waives the benefit of any statute now or
hereinafter in effect, including the provisions of sections 1941 and 1942 of the Civil Code of
California, which would otherwise afford Lessee the right to make repairs at Town's expense
or to terminate this Lease because of Town's failure to keep Premises in good order,
condition and repair. Lessee further agrees that if and when any repairs, alterations, additions
5 Rev. May 2013
or betterments shall be made by Lessee as required by this paragraph, Lessee shall promptly
pay for all labor done or materials furnished and shall keep the Premises free and clear of any
lien or encumbrance of any kind whatsoever. If Lessee fails to make any repairs or perform
any maintenance work for which Lessee is responsible within a reasonable time (as
determined by the Town Manager in the Town Manager's sole discretion) after demand by
the Town, Town shall have the right, but not the obligation, to make the repairs at Lessee's
expense; within ten (10) days of receipt of a bill, Lessee shall reimburse Town for the cost of
such repairs, including a fifteen percent (15 %) administrative overhead fee. The making of
such repairs or performance of maintenance by Town shall in no event be construed as a
waiver of the duty of Lessee to make repairs or perform maintenance as provided in this
Section.
9.3 Maintenance of Common Areas. Town shall maintain or cause to be maintained,
including repair and replacement as necessary, the exterior grounds, exterior shared deck, and
the parking lot adjacent to the Premises. If Lessee uses the shared deck for activities or a
special event, Lessee shall promptly remove all structures, fixtures, accessories, decorations
and trash associated with the activity or event.
10. TENANT IMPROVEMENTS.
10.1 Improvements Permitted. Subject to prior written approval of the Town Manager,
which shall not be unreasonably withheld, Lessee shall be entitled to install improvements in
an efficient and workmanlike manner within the Premises, at no cost to Town. All costs of
plans, improvements, and permits shall be the sole responsibility of the Lessee. All structural
improvements and improvements in excess of $5,000 must be approved in writing by the
Town Manager.
10.2 Cost of Improvements. All tenant improvements shall be made at Lessee's sole
expense.
10.3 Ownership of Improvements. All improvements constructed, erected, or installed upon
the Premises must be free and clear of all liens, claims, or liability for tabor or material and
shall become the property of Town, at its election, upon expiration or earlier termination of
this tease and upon Town's election, shall remain upon the Premises upon termination of this
Lease. Title to all free standing equipment, furniture, furnishings, and trade fixtures placed
by Lessee upon the Premises shall remain in Lessee's ownership, and replacements,
substitutions and modifications thereof may be made by Lessee throughout the term of this
Lease.
10A Indemnity for Claims Arising Out of Construction. Lessee shall defend and indemnify
Town against all claims, liabilities, and losses of any type arising out of work performed on
the Premises by Lessee, together with reasonable attorneys' fees and all costs and expenses
reasonably incurred by Town in negotiating, settling, defending or otherwise protecting
against such claims.
Rev. May 2013
10.5 Certificate of Inspection. Upon completion of construction of any building, Lessee
shall submit to the Town Manager a Certificate of Inspection, verifying that the construction
was completed in conformance with Title 20 of the California Code of Regulations for
residential construction, or in conformance with Title 24 of the California Code of
Regulations for non - residential construction.
10.6 As Built Plans. Lessee shall provide the Town Manager with a complete set of
reproducible "as built plans" reflecting actual construction within or upon the Premises upon
completion of any: (i) new construction; (ii) structural alterations; or, (iii) non - structural
alterations costing more than $25,000.
11. ALTERATIONS BY LESSEE
Lessee shall not make any alterations or improvements to the Premises without obtaining the prior
written consent of the Town Manager. Lessee may, at any time and at its sole expense, install and
place business fixtures and equipment within the Premises, provided such fixtures and installation
have been reviewed and approved by the Town Manager.
12. HOLD RARMLESS/LNDEMNIFICATION.
12.1 Indemnification. To the extent permitted by law, Lessee agrees to protect, defend, hold
harmless and indemnify Town, its Town Council, commissions, officers, agents, volunteers,
and employees from and against any claim, injury, liability, loss, cost, and/or expense or
damage, however same may be caused, including all costs and reasonable attorney's fees in
providing a defense to any claim arising therefrom for which Town shall become legally
liable arising from Lessee's negligent, reckless, or wrongful acts, errors, or omissions with
respect to or in anyway connected with this Lease. Lessee shall give Town immediate notice
of any claim or liability hereby indemnified against. This indemnity shall be in addition to
the Hazardous Materials indemnity contained in this Lease and shall survive shall survive the
expiration of or early termination of the Lease Term.
12.2 Waiver of Claims. Lessee waives any claims against Town for injury to Lessee's
business or any loss of income therefrom, for damage to Lessee's property, or for injury or
death of any person in or about the Premises or the Town Property, from any cause
whatsoever, except to the extent caused by Town's active negligence or willful misconduct.
13. DAMAGE DESTRUCTION AND TERMINATION.
13.1 Nontermination and Nonabatement. Except as provided herein, no destruction or
damage to the Premises by fire, windstorm or other casualty, whether insured or uninsured,
shall entitle Lessee to terminate this Lease. Town and Lessee waive the provisions of any
statutes which relate to termination of a lease when leased property is destroyed and agree
that such event shall be governed by the terms of this Lease.
13.2 Force Majeure. Prevention, delay or stoppage due to strikes, lockouts, labor disputes,
7 Rev. May 2013
Acts of God, inability to obtain labor, inability to obtain materials or reasonable substitutes,
governmental restrictions, governmental regulation, governmental controls, judicial orders,
enemy or hostile governmental actions, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of Lessee (financial inability excepted), shall excuse
the performance by Lessee for a period equal to the prevention, delay, or stoppage, except the
obligations imposed with regard to rent to be paid by Lessee pursuant to this Lease. In the
event any work performed by Lessee or Lessee's contractors results in a strike, lockout,
and/or labor dispute, the strike, lockout, and /or labor dispute shall not excuse the
performance by Lessee of the provisions of this Lease.
13.3 Restoration of Premises by Lessee.
13.3.1 Destruction Due to Risk Covered by Insurance. If, during the term, the
Premises are totally or partially destroyed from a risk covered by the
insurance described in Section 20 (Insurance), rendering the Premises totally
or partially inaccessible or unusable, Lessee shall restore the Premises to
substantially the same condition as it was in immediately before destruction,
whether or not the insurance proceeds are sufficient to cover the actual cost of
restoration. Such destruction shall not terminate this Lease. If the laws
existing at that time do not permit the restoration, either party can terminate
this Lease immediately by giving notice to the other party.
A. Minor Loss. If, during the term of this Lease, the Premises are destroyed
from a risk covered by the insurance described in Section 20 (Insurance), and
the total amount of loss does not exceed twenty thousand dollars ($20,000),
Lessee shall make the loss adjustment with the insurance company insuring
the loss. The proceeds shall be paid directly to Lessee for the sole purpose of
making the restoration of the Premises in accordance with this Lease.
B. Major Loss- Insurance Trustee. If, during the term of this Lease, the
Premises are destroyed from a risk covered by the insurance described in
Section 20 (Insurance), and the total amount of loss exceeds the amount set
forth in paragraph (1), Lessee shall make the loss adjustment with the
insurance company insuring the loss and on receipt of the proceeds shall
immediately pay them to an institutional lender or title company as may be
jointly selected by the parties ( "the Insurance Trustee ").
13.3.2 Destruction Due to Risk Not Covered by Insurance. If, during the term, the
Premises are totally or partially destroyed from a risk covered by the
insurance described in Section 20 (Insurance), rendering the Premises totally
or partially inaccessible or unusable, Lessee shall restore the Premises to
substantially the same condition as it was in immediately before destruction,
whether or not the insurance proceeds are sufficient to cover the actual cost of
restoration. Such destruction shall not terminate this Lease. If the laws
existing at that time do not permit the restoration, either party can terminate
8 Rev. May 2013
this Lease immediately by giving notice to the other party.
If the cost of restoration exceeds ten percent (10 %) of the then replacement
value of the Premises totally or partially destroyed, Lessee can elect to
terminate this Lease by giving notice to Town within sixty (60) days after
determining the restoration cost and replacement value. If Lessee elects to
terminate this Lease, Town, within thirty (30) days after receiving Lessee's
notice to terminate, can elect to pay to Lessee, at the time Town notifies
Lessee of its election, the difference between ten percent (10 %) of the
replacement value of the Premises and the actual cost of restoration, in which
case Lessee shall restore the Premises. On Town's making its election to
contribute, each party shall deposit immediately the amount of its
contribution with such institutional tender or title company as may be jointly
selected by the parties ( "the Insurance Trustee "). If the Destruction does not
exceed ten percent (10 %) of the then replacement value of the Premises,
Lessee shall immediately deposit the cost of restoration with the Insurance
Trustee as provided in Exhibit (c). This Lease shall terminate if Lessee elects
to terminate this Lease and Town does not elect to contribute toward the cost
of restoration as provided in this section.
If the Premises are destroyed from a risk not covered by the insurance
described in Section 20 (Insurance), and Lessee has the obligation to restore
the Premises as provided in subsection (B), both parties shall deposit with the
Insurance Trustee their respective contributions toward the cost of
restoration. All sums deposited with the Insurance Trustee shall be held for
the following purposes and the Insurance Trustee shall have the following
powers and duties:
The sums shall be paid in installments by the Insurance Trustee to the
contractor retained by Lessee as construction progresses, for payment of the
cost of Restoration. A 10% retention fund shall be established that will be
paid to the contractor on completion of restoration, payment of all costs,
expiration of all applicable lien periods, and proof that the Premises are free
of all mechanics' liens and iienable claims.
Payments shall be made on presentation of certificates or vouchers from the
architect or engineer retained by Lessee showing the amount due. If the
Insurance Trustee, in its reasonable discretion, determines that the certificates
or vouchers are being improperly approved by the architect or engineer
retained by Lessee, the Insurance Trustee shall have the right to appoint an
architect or an engineer to supervise construction and to make payments on
certificates or vouchers approved by the architect or engineer retained by the
Insurance Trustee. The reasonable expenses and charges of the architect or
engineer retained by the Insurance Trustee shall be paid by the insurance
trustee out of the trust fund. Both parties shall promptly execute all
9 Rev. May 2013
documents and perform all acts reasonably required by the Insurance Trustee
to perform its obligations under this section.
If the sums held by the Insurance Trustee are not sufficient to pay the actual
cost of restoration Lessee shall deposit the amount of the deficiency with the
Insurance Trustee within fifteen (15) days after request by the Insurance
Trustee indicating the amount of the deficiency. Any undisbursed funds after
compliance with the provisions of this section shall be delivered to Town to
the extent of Town's contribution to the fund, and the balance, if any, shall be
paid to Lessee. All actual costs and charges of the Insurance Trustee shall be
paid by Lessee.
If the Insurance Trustee resigns or for any reason is unwilling to act or
continue to act, Town shall substitute a new trustee in the place of the
designated Insurance Trustee. The new trustee must be an institutional lender
or title company.
13.3.3 Procedure for Restoring Premises. When Lessee is obligated to restore the
Premises within sixty (60) days Lessee at its cost shall prepare final plans,
specifications, and working drawings complying with applicable Laws that
will be necessary for restoration of the Premises. The plans, specifications,
and working drawings must be approved by Town. Town shall have thirty
(30) days after receipt of the plans and specifications and working drawings
to either approve or disapprove the plans, specifications, and working
drawings and return them to Lessee. If Town disapproves the plans,
specifications, and working drawings, Town shall notify Lessee of its
objections and Town's proposed solution to each objection. Lessee
acknowledges that the plans, specifications, and working drawings shall be
subject to approval of the appropriate governmental bodies and that they will
be prepared in such a manner as to obtain that approval.
The restoration shall be accomplished as follows:
A. Lessee shall complete the restoration within 60 working days after final
plans and specifications and working drawings have been approved by the
appropriate governmental bodies and all required permits have been obtained
(subject to a reasonable extension for delays resulting from causes beyond
Lessee's reasonable control).
B. Lessee shall retain a licensed contractor that is bondable. The contractor
shall be required to carry public liability and property damage insurance,
standard fire and extended coverage insurance, with vandalism and malicious
mischief endorsements, during the period of construction in accordance with
Section 20 (Insurance). Such insurance shall contain waiver of subrogation
clauses in favor of Town and Lessee in accordance with the Provisions of
10 Rev. May 2013
Exhibit B.
C. Lessee shall notify Town of the date of commencement of the restoration
at least ten (10) days before commencement of the restoration to enable Town
to post and record notices of nonresponsibility. The contractor retained by
Lessee shall not commence construction until a completion bond and a labor
and materials bond have been delivered to Town to insure completion of the
construction.
D. Lessee shall accomplish the restoration in a manner that will cause the
least inconvenience, annoyance, and disruption at the Premises.
E. On completion of the restoration Lessee shall immediately record a notice
of completion in the county in which the Premises are located.
F. The restoration shall not be commenced until sums sufficient to cover the
cost of restoration are placed with the Insurance Trustee as provided in this
section.
14. SIGNS AND MARKETING.
14.1 Lessee shall not place, construct, maintain, or allow any signs affixed to the building or
to the exterior of the Premises without prior written consent of the Town following Town
Council review and approval. Lessee shall submit an application to the Community
Development Department and, be obligated to pay all costs associated with any application
process required to obtain approval for any signs.
14.2 Lessee shall not place, construct, maintain, or allow any other signs, including minor
ones, visible to the exterior of the Premises without prior written consent of the Town
Manager. Lessee shall submit an application to the Community Development Department
and, be obligated to pay all costs associated with any application process required to obtain
approval for any signs. Lessee shall include the Town logo on items related to marketing
programs operated, conducted, sponsored, in whole or in part, by Lessee on the Premises,
subject to Town Manager review. Exterior or otherwise visible signage shall be subject to
the Town's naming policy and donation policy.
14.3 Town shall include references to Lessee on signs and marketing programs prepared by
or for Town in association with Lessee's operations on the Premises.
15. ASSIGNMENT AND SUBLETTING.
15.1 Town's Consent Required. Lessee shall not assign this Lease, nor any interest therein,
and shall not sublet or encumber the Premises or any part thereof, nor any right or privilege
11 Rev. May 2013
appurtenant thereto, nor allow or permit any other person(s) to occupy or use the Premises, or
any portion thereof, without the prior written consent of Town. This Lease shall be binding
upon any permitted assignee or successor of Lessee. Consent by Town to one assignment,
subletting, occupation or use by another person shall not be deemed to be consent to any
subsequent assignment, subletting, occupation or use by another person. No assignment,
subletting, or encumbrance by Lessee shall release it from or in any way alter any of Lessee's
obligations under this Lease. Lessee may have the Premises delivered to a subsidiary
company of Lessee, but such arrangement shall in no way alter Lessee's responsibilities
hereunder with respect to the Premises. Any assignment, subletting, encumbrances,
occupation, or use contrary to the provisions of this Lease shall be void and shall constitute
breach of this Lease. Town may assign any of its rights hereunder without notice to Lessee.
15.2 No Release of Lessee. No subletting or assignment as approved by Town shall release
Lessee of Lessee's obligation or alter the primary liability of Lessee to pay the rent and to
perform all other obligations by Lessee hereunder. The acceptance of rent by Town from any
other person shall not be deemed to be a waiver by Town of any provision hereof. In the
event of default by any assignee of Lessee or any successor of Lessee in the perfonnance of
any of the terms hereof, Town may proceed directly against Lessee without the necessity of
exhausting remedies against said assignee.
16. DEFAULTS: REMEDIES.
16.1 Defaults. The occurrence of any one or more of the following events shall constitute a
material default, or breach of this Lease, by Lessee:
16. 1.1 Abandonment of the Premises by Lessee as defined by California Civil Code
section 1951.3;
16.1.2 Failure by Lessee to make any payment of rent or any other payment required
to be made by Lessee hereunder, as provided in this Lease, where such failure shall
continue for a period of ten (10) business days after written notice thereof from Town
to Lessee. In the event Town serves Lessee with a Notice to Pay Rent or Quit
pursuant to applicable Unlawful Detainer statutes, such Notice to Pay Rent or Quit
shall also constitute the notice required by this subparagraph;
16.13 Failure by Lessee to observe or perform any of the covenants, conditions or
provisions of this Lease in any material respect where such failure shall continue for
a period of thirty (30) days after written notice thereof from Town to Lessee;
provided, however, that if the nature of Lessee's default is such that more than thirty
(30) days are reasonably required for its cure, then Lessee shall not be deemed to be
in default if Lessee commenced such cure within said thirty (30) day period and
thereafter diligently prosecutes such cure to completion;
16.1.4 Making by Lessee of any general arrangement or assignment for the benefit of
creditors; Lessee's becoming a "debtor" as defined in I1 U.S.C. §t01 or any
12 Rev. May 2013
successor statute thereto (unless, in the case of a petition filed against Lessee, the
same is dismissed within sixty (60) days); the appointment of a bankruptcy trustee or
receiver to take possession of all or substantially all of Lessee's assets located at or
on the Premises or of Lessee's interest in this Lease where possession is not restored
to Lessee within thirty (30) days; or the attachment, execution or other judicial
seizure of all or substantially all of Lessee's assets located at or on the Premises or of
Lessee's interest in this Lease, where such seizure is not discharged within thirty (30)
days.
16.1.5 Failure to make the Funding Commitment payments as required under this
Lease Agreement for a period of six (6) months or more.
16.2 Remedies. In the event of any material default or breach by Lessee, Town may at any
time thereafter, following any notice required by statute, and without limiting Town in the
exercise of any right or remedy which Town may have by reason of such default or breach:
16.2.1 Terminate Lessee's right to possession of the Premises by any lawful means,
in which case this Lease shall tenminate and Lessee shall immediately surrender
possession of the Premises and Improvements to Town. hi such event, Town shall be
entitled to recover from Lessee all damages incurred by Town by reason of Lessee's
default including but not limited to: the cost of recovering possession of the Premises
and Improvements; expenses of reletting, including necessary renovation and
alteration of the Premises and Improvements; reasonable attorneys' fees; the worth at
the time of the award of the unpaid rent that had been earned at the time of
termination of this Lease and the worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the time of such award exceeds the
amount of such rental loss for the same period that Lessee proves could be reasonably
avoided.
16.2.2 Maintain Lessee's right to possession, in which case this Lease shall continue
in effect whether or not Lessee shall have abandoned the Premises. In such event,
Town shall be entitled to enforce all of Town's rights and remedies under this Lease,
including the right to recover rent and other payments as theybecome due hereunder.
16.2.3 Pursue any other remedy now or hereafter available to Town under the laws
or judicial decisions of the State of California. Town shall have all remedies
provided by law and equity.
163 No Relief from Forfeiture After Default. Lessee waives all rights of redemption or
relief from forfeiture under California Code of Civil Procedure sections 1174 and 1179, and
any other present or future law, in the event Lessee is evicted or Town otherwise lawfully
takes possession of the Premises by reason of any default or breach of this Lease by Lessee.
16.4 Disposition of Abandoned Personal Propert y. If the Lessee fails to remove any personal
property belonging to Lessee from the Premises after forty -five (45) days of the expiration or
13 Rev. May 2013
termination of this Lease, such property shall at the option of Town be deemed to have been
transferred to Town. Town shall have the right to remove and to dispose of such property
without liability to Lessee or to any person claiming under Lessee, and the Town shall have
no need to account for such property.
17. INTEREST ON PAST -DUE OBLIGATIONS.
Except as expressly provided herein, any amount due Town when not paid when due shall bear
interest at the lesser of ten percent (10 %) per year or the maximum rate then allowable by law from
the date due.
18. HOLDING OVER.
If Lessee remains in possession of the Premises or any part thereof after the expiration of the term or
option term hereof, such occupancy shall be a tenancy from month to month with all the obligations
of this Lease applicable to Lessee and at a monthly rental obligation at the market rate in effect at the
time of expiration. Nothing contained in this Lease shall give to Lessee the right to occupy the
Premises after the expiration of the term, or upon an earlier termination for breach.
19. TOWN'S ACCESS.
19.1 Access for Inspection. Town and Town's agents shall have the right to enter the
Premises at reasonable times, upon not less than twenty -four (24) hours prior notice to
Lessee, for the purpose of inspecting same, showing same to prospective purchasers, lenders
or lessees, and making such alterations, repairs, improvements, or additions to the Premises
as Town may deem necessary.
19.2 Security Measures. Town shall have the right to require a reasonable security system,
device, operation, or plan be installed and implemented to protect the Premises or the
Improvements. Should Town, in its sole discretion, require Lessee to install such a security
system, Lessee agrees to bear the sole cost and expense of any security system, device,
operation or plan and the installation and implementation thereof. Lessee shall obtain
Town's prior approval before installing, implementing or changing any Town approved
security system, device, operation or plan.
19.3 New Locks. Lessee may not install new locks on any doors without the express written
consent of the Town. Lessee shall advise Town of such action and shall provide Town with
keys to said locks. Lessee shall also deliver to Town the old locks with keys. Upon
termination, Lessee shall leave new locks that shall become the property of Town.
20. INSURANCE.
Lessee's responsibility for the Premises begins immediately upon delivery and Lessee, at its sole cost
and expense, and at no cost to Town, shall purchase and maintain in full force and effect during the
entire term of this Lease insurance coverage in amounts and in a form acceptable to Town as set
14 Rev. May 20 13
forth in Exhibit C attached hereto and incorporated herein by reference. Said policies shall be
maintained with respect to Lessee's employees, if any, and all vehicles operated on the Premises.
The policies shall include the required endorsements, certificates of insurance and coverage
verifications as described in Exhibit C.
Lessee shall be responsible for all losses incurred for any reason of its personal property or contents
on Premises. Lessee may want to consider securing renter's liability insurance.
Lessee shall deposit with the Town Manager, on or before the effective date of this Lease, certificates
of insurance necessary to satisfy Town that the insurance provisions of this Lease have been
complied with, and to keep such insurance in effect and the certificates therefore on deposit with
Town during the entire term of this Lease. Should Lessee not provide evidence of such required
coverage at least three (3) days prior to the expiration of any existing insurance coverage, Town may
purchase such insurance, on behalf of and at the expense of Lessee to provide six months of
coverage.
Town shall retain the right at any time to review the coverage, form, and amount of the insurance
required hereby. If, in the opinion of the Town's Risk Manager (or comparable official), the
insurance provisions in this Lease do not provide adequate protection for Town and for members of
the public using the Premises, the Town Manager may require Lessee to obtain insurance sufficient
in coverage, form, and amount to provide adequate protection as determined by the Risk Manager.
Town's requirements shall be reasonable and shall be designed to assure protection from and against
the kind and extent of risk that exists at the time a change in insurance is required.
The Town Manager shall notify Lessee in writing of changes in the insurance requirements. If
Lessee does not deposit copies of acceptable insurance policies with Town incorporating such
changes within sixty (60) days of receipt of such notice, or in the event Lessee fails to maintain in
effect any required insurance coverage, Lessee shall be in default under this lease without further
notice to Lessee. Such failure shall constitute a material breach and shall be grounds for immediate
termination of this Lease at the option of Town.
The procuring of such required policy or policies of insurance shall not be construed to limit
Lessee's liability hereunder nor to fulfill the indemnification provision and requirements of this
Lease. Notwithstanding the policy or policies of insurance, Lessee shall be obligated for the full and
total amount of any damage, injury, or loss caused by or connected with this Lease or with use or
occupancy of the Premises.
21. [reserved]
22. DISPUTE RESOLUTION.
22.1 Unless otherwise mutually agreed to, any controversies between Lessee and Town
regarding the construction or application of this Lease, and claims arising out ofthis Lease or
its breach shall be submitted to mediation within thirty (30) days of the written request of
one Party after the service of that request on the other Party.
15 Rev. May 2013
22.2 The Parties may agree on one mediator. If they cannot agree on one mediator, the Party
demanding mediation shall request the Superior Court of Santa Clara County to appoint a
mediator. The mediation meeting shall not exceed one day (eight (8) hours). The Parties may
agree to extend the time allowed for mediation under this Lease.
22.3 The costs of mediation shall be borne by the Parties equally.
22.4 Mediation under this section is a condition precedent to filing an action in any court. In
the event of litigation arising out of any dispute related to this Lease, the Parties shall each
pay their respective attome3's fees, expert witness costs and cost of suit, regardless of the
outcome of the litigation.
23. NON - LIABILITY OF OFFICIALS AND EMPLOYEES OF THE TOWN.
No official or employee of Town shall be personally liable for any default or liability under this
agreement.
24. NON - DISCRIMINATION
24.1 Non- discrimination in Lease Activities. Lessee agrees that in the performance of this
Lease and in connection with all of the activities Lessee conducts on the Premises, it shall not
discriminate against any employee or person because of the race, skin color, gender, age, religion,
disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status,
weight or height of such person. Lessee acknowledges that is familiar with the provisions set forth in
Section 2.30.5 10 of the Los Gatos Municipal Code relating to nondiscrimination in employment and
Section 9.73 of the Los Gatos Municipal Code relating to Town policy against arbitrary
discrimination.
24.2 Human Rights Policy. In connection with all activities that are conducted upon the
Premises, Lessee agrees to accept and enforce the statements of policy set forth in Section 9.73.010
which provides: "It is the policy of the Town of Los Gatos to affirm, support and protect the human
rights of every person within its jurisdiction. These rights include, but are not limited to, equal
economic, political; and educational opportunity; equal accommodations in all business
establishments in the Town; and equal service and protection by all public agencies of the Town."
25. INDEPENDENT CONTRACTOR.
It is agreed that Lessee shall act and be an independent contractor and not an agent nor employee of
Town.
26. CONFLICT OF INTEREST.
Lessee shall at all times avoid conflict of interest or appearance of conflict of interest in performance
of this agreement. Lessee warrants and covenants that no official or employee of Town nor any
16 Rev. May 2013
business entity in which any official or employee of Town is interested: (1) has been employed or
retained to solicit or aid in the procuring of this agreement; or (2) will be employed in the
performance of this agreement without the divulgence of such fact to Town. In the event that Town
determines that the employment of any such official, employee or business entity is not compatible
with such official's or employee's duties as an official or employee of Town, Lessee upon request of
Town shall immediately terminate such employment. Violation of this provision constitutes a
serious breach of this Lease and Town may terminate this Lease as a result of such violation.
27. MEMORANDUM OF LEASE
Following execution of this Lease, Town shall be entitled to record a Memorandum of Lease in the
official records of Santa Clara County. Upon termination or expiration of this Lease, Lessee shall
execute and record a quitclaim deed as to its leasehold interest.
28. ESTOPPEL CERTIFICATE.
Lessee shall, from time to time, upon at least thirty (30) days prior written notice from Town,
execute, acknowledge and deliver to Town a statement in writing: (i) certifying this Lease is
unmodified and in full force and effect, or, if modified, stating the nature of the modification and
certifying that the Lease, as modified, is in full force and effect, and the date to which the rental and
other charges, if any, have been paid; and, (ii) acknowledging that there are not to Lessee's
knowledge, any defaults, or stating if any defaults are claimed, any statement may be relied upon by
any prospective purchaser or encumbrance of the Town Property.
29. LIENS.
Lessee agrees at its sole cost and expense to keep the Premises free and clear of any and all claims,
levies, liens, encumbrances or attachments.
30. VACATING.
Upon termination of the tenancy, Lessee shall completely vacate the Premises, including the removal
of any and all of its property. Before departure, Lessee shall return keys and personal property listed
on the inventory to Town in good, clean and sanitary condition, reasonable wear and tear excepted.
Lessee shall allow Town to inspect the Premises to verify the condition of the Premises and its
contents.
31. ABANDONMENT.
Lessee's absence from the Premises for three (3) consecutive days, without prior notice, during which
time rent or other charges are delinquent, shall be deemed abandonment of the Premises. Such
abandonment will be deemed cause for immediate termination without notice. Town shall thereupon
be authorized to enter and take possession and to remove and dispose of the property of Lessee or its
guests without any liability whatsoever to Town.
17 Rev. May 2013
32. NOTICES.
All notices to the Parties shall, unless otherwise requested in writing, be sent to Town addressed as
follows:
Town of Los Gatos
Attention: Town Manager
110 E. Main Street
Los Gatos, CA 95030
E -Mail: Manager @LosGatosca.eov
And to Lessee addressed as follows:
Friends of the Los Gatos Public Library
Marlene Rodman
100 Villa Ave.
Los Gatos, CA 95030
Facsimile:
E -mail: marlenerodmanElgirail.com
Notices maybe served upon Lessee in person, by first class mail, or by certified mail whether or not
said mailing is accepted by Lessee. If notice is sent via facsimile or e-mail, a signed, hard copy of
the material shall also be mailed. The workday the facsimile was sent shall control the date notice
was deemed given if there is a facsimile machine generated document on the date of transmission. A
facsimile transmitted after 1:00 p.m. on a Friday shall be deemed to have been transmitted on the
following Monday. These addresses shall be used for service of process.
33. TIME.
Time shall be of the essence in this Lease.
34. AMENDMENTS.
It is mutually agreed that no oral Leases have been entered into and that no alteration or variation of
the terms of this Lease shall be valid unless made in writing and signed by the Parties to this Lease.
35. SIGNING AUTHORITY.
If this Lease is not signed by all Lessees named herein, the person actually signing warrants that
he /she has the authority to sign for the others.
36. CAPTIONS.
The captions of the various sections, paragraphs and subparagraphs ofthis Lease are for convenience
only and shall not be considered or referred to in resolving questions of interpretation.
18 Rev. May 2013
37. SURRENDER OF LEASE NOT MERGER.
The voluntary or other surrender of this lease by Lessee, or a mutual cancellation thereof, shall not
work a merger, and shall, at the option of Town, terminate all or any existing subleases or
subtenancies, or may, at the option of Town, operate as an assignment of any and all such subleases
or subtenancies.
33. INTEGRATED DOCUMENT.
This Lease, including any exhibits attached hereto, embodies the entire agreement between Town
and Lessee. No other understandin, agreements, conversations or otherwise, with anyoffrcer, agent
or employee of Town prior to execution of this Lease shall affect or modify any of the terms or
obligations contained in any documents comprising this Lease. Any such verbal agreement shall be
considered as unofficial information and in noway binding upon Town. All agreements with Town
are subject to approval of the Town Council before Town shall be bound thereby.
39. WAIVER.
Waiver by Town of one or more conditions of perfonnance or any breach of a condition under this
Lease shall not be construed as a waiver of any other condition of performance or subsequent
breaches. The subsequent acceptance by a Party of the performance of any obligation or duty by
another Party shall not be deemed to be a waiver of any term or condition of this Lease. The exercise
of any remedy, right, option or privilege hereunder by Town shall not preclude Town from exercising
the same or any and all other remedies, rights, options and privileges hereunder and Town's failure to
exercise any remedy, right, option or privilege at law or equity, or otherwise which Town may have,
shall not be construed as a waiver.
40. INTERPRETATIONS.
In construing or interpreting this Lease, the word "or" shall not be construed as exclusive and the
word "including" shall not be limiting. The Parties agree that this Lease shall be fairly interpreted in
accordance with its terns without any strict construction in favor of or against any other Party.
41. SEVERABILITY CLAUSE.
If any provision of this Lease is held to be illegal, invalid or unenforceable in full or in part, for any
reason, then such provision shall be modified to the minimum extent necessary to make the provision
legal, valid and enforceable, and the other provisions of this Lease shall not be affected thereby.
42. GOVERNING LAW.
This Lease shall be governed and construed in accordance with the statutes and laws of the State of
California.
19 Rev. May 2013
43. VENUE.
In the event that suit shall be brought by any Party to this Lease, the Parties agree that venue shall be
exclusively vested in the state courts of the County of Santa Clara.
44. COMPLIANCE WITH LAWS.
The Parties hereto shall comply with all applicable laws, ordinances, codes and regulations of the
federal, state and local governments in the performance of their rights, duties and obligations under
this Lease.
45. BROKERS.
Each party represents that is has not had dealings with any real estate broker, finder, or other person,
with respect to this lease in any manner. Each Party shall hold harmless the other party from all
damages resulting from any claims that may be asserted against the other party by any broker, finder,
or other person with whom the Indemnifying Party has or purportedly has dealt.
46. ATTACHMENTS TO LEASE.
The following exhibits are attached to and made a part of this Agreement:
"A" — Description of Subject Premises
B" - Standard Insurance Requirements
20 Rev. May 2013
IN WITNESS WHEREOF, the parties have executed this Lease the day and year first above
written.
TOWN: TENANT:
TOWN OF LOS GATOS (LESSOR) FRIENDS OF THE LOS GATOS
PUBLIC LIBRARY
Greg Larson, Town Manager A Marlene Rodman, President
ATTEST:
To \ Clerk Administrator
APPROVED AS TO FORM:
Judit ropp, Townl ttome
21, Rev. May 2013
LEASE AGREEMENT
BETNVEEN
TO`VN OF LOS GATOS
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
EXHIBIT A
DESCRIPTION OF SUBJECT PREMISES
Lease A2reement. Friends of'Los Gatos Pubtic Library Exhibit A Page 22 of 25
(INSERT DATE TYPED)
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W Former Library Space Renovation
_ 3 - x 110 E. Main st.1 a r[aavi NaartivaszayniFS ar.n.
Los Gatos, CA 95030
LEASE AGREEMENT
BY AND BETWEEN
TOWN OF LOS GATOS, CALIFORNIA
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
EXHIBIT B
STANDARD INSURANCE REQUIREMENTS
Insurance Requirements for Lessee:
Lessee shall purchase and maintain the insurance policies set forth below on all of its operations
under this Lease at its sole cost and expense. Such policies shall be maintained for the full term of
this Lease and the related warranty period (if applicable). For purposes of the insurance policies
required under this Lease, the tern "Town" shall include the duly elected or appointed council
members, commissioners, officers, agents, employees and volunteers of the Town of Los Gatos,
California, individually or collectively.
Coverages (RL 28.1 A) S
Minimum Scope of Insurance
Coverage shall be at least as broad as:
1) Insurance Services Office Commercial General Liability coverage (occurrence form
CG 0001).
2) Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile
Liability, code 1 (any auto).
3) Workers' Compensation insurance as required by the State of California and
Employer's Liability Insurance (for lessees with employees).
4) Property insurance against all risks of loss to any tenant improvements or betterments
The policy or policies of insurance maintained by Lessee shall provide the following limits and
coverages:
POLICY
(1) Commercial General Liability
(2) Automobile Liability
Including Owned, Hired and
Non -Owned Automobiles
Lease Agreement/Friends of the Los Gatos Public Library
(INSERT DATE)
MINIMUM LIMITS OF LIABILITY
$1,000,000 per each occurrence for bodily
injury, personal injury and property damage
$ 1,000,000 Combined Single Limit
Exhibit B Page 23 of 25
(3) Workers' Compensation Statutory
Employers Liability $1,000,000 per accident for bodily injury or
disease
(4) Lessee's Property Insurance
Lessee shall procure and maintain property insurance coverage for:
(a) all office furniture, trade fixture, office equipment, merchandise,
and all other items of Lessee's property in, on, at, or about the
premises and the building, include property installed by, for,
or at the expense of Lessee;
(b) all other improvements, betterments, alterations, and additions
to the premises.
Lessee's property insurance must fulfill the following requirements:
(a) it must be written 'on the broadest available "all risk" policy form or an
equivalent form acceptable Town of Los Gatos, including earthquake sprinkler
leakage.
(b) for no less than ninety percent (90 %) of the full
replacement cost (new without deduction for depreciation)
of the covered items and property; and
(e) the amounts of coverage must meet any coinsurance
requirements of the policy or policies.
(RL 28.2)
Deductibles and Self - Insured Retentions
Any deductibles or self - insured retentions must be declared to and approved by the Town. At the
option of the Town either: the insurer shall reduce or eliminate such deductibles or self - insured
retentions as respects the Town, its officers, officials, employees and volunteers; or the Lessee shall
procure a bond guaranteeing payment of losses and related investigations, claim administration and
defense expenses.
Insurance shall be in full force and effect commencing on the first day of the term of this Lease.
Each insurance policy required by this Lease shall:
1. Be endorsed to state that coverage shall not be suspended, voided, canceled by either
party, 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 Town.
2. Include a waiver of all rights of subrogation against the Town and the members of the
Town Council and elective or appointive officers or employees, and each parry shall
indemnify the other against any loss or expense including reasonable attorney fees,
resulting from the failure to obtain such waiver.
Lease AgreententlFriends of the Los Gatos Public Library Exhibit B Page 24 of 25
(INSERT DATE )
3. Name the Town of Los Gatos as a loss payee on the property policy.
4. Provide that the Town, its officers, officials, employees, agents and volunteers are to
be covered as insureds as respects: liability arising out of activities performed by or
on behalf of the Lessee; products and completed operations of the Lessee; premises
owned, occupied or used by the Lessee; or automobiles owned, leased, hired or
borrowed by the Lessee. The coverage shall contain no special limitations on the
scope of protection afforded to the Town, its officers, officials, employees, agents or
volunteers.
5. Provide that for any claims related to this Lease, the Lessee's insurance coverage shall
be primary insurance as respects the Town, its officers, officials, employees, agents
and volunteers. Any insurance or self - insurance maintained by the Town, its officers,
officials, employees, agents or volunteers shall be excess of the Lessee's insurance
and shall not contribute with it.
Provide that any failure to comply with reporting or other provisions of the policies
including breaches of warranties shall not affect coverage provided to the Town, its
officers, officials, employees, agents or volunteers.
Provide that Lessee's insurance shall apply separately to each insured against whom
claim is made or suit is brought, except with respect to the limits of the insurer's
liability.
8. Lessee agrees to promptly pay to Town as Additional Rent, upon demand, the amount
of any increase in the rate of insurance on the Premises or on any other part of
Building that results by reason of Lessee's act(s) or Lessee's permitting certain
activities to take place.
Acceptability of Insurers
All insurance policies shall be issued by California- admitted carriers having current A.M. Best's
ratings of no lower than A -:VII.
Lease AgreemendFriends of the Los Gatos Public Library Exhibit 13 Page 25 of 25
(INSERT DATE)
LEASE AGREEMENT
BETWEEN
TOWN OF LOS GATOS
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBARY
TABLE OF CONTENTS
LEASE PROVISIONS
1. PREMISES......
101 M
1
2. TERM ................................................................................................... ..............................1
3. RENT .................................................................................................. ............................... 2
4. FUNDING COMMITMENT ............................................................ ............................... 2
5. USE OF PREMISES and OPERATING HOURS .......................... ............................... 2
6.
[reserved] ............................................................................................ ............................... 4
7.
UTILITIES AND OPERATING EXPENSES ................................. ...............................
4
8.
TAXES ................................................................................................. ..............................4
9.
MAINTENANCE ................................................................................ ..............................5
10.
TENANT IMPROVEMENTS .......................................................... ...............................
6
11.
ALTERATIONS BY LESSEE .......................................................... ...............................
7
12.
HOLD HARMLESS / INDEMNIFICATION .................................... ..............................
7
13.
DAMAGE, DESTRUCTION AND TERMINATION .................... ...............................
7
14.
SIGNS .................................................................................................. .............................11
15. ASSIGNMENT AND SUBLETTING .............................................. .............................11
16. DEFAULTS; REMEDIES ................................................................. .............................12
17. INTEREST ON PAST -DUE OBLIGATIONS ................................ .............................14
18. HOLDING OVER .............................................................................. .............................14
19. TOWN'S ACCESS ............................................................................ .............................14
20. INSURANCE ...................................................................................... .............................14
21. EMINENT DOMAIN ...................................................................... ............................... 15
22. DISPUTE RESOLUTION .............................................................. ............................... 15
23. NON - LIABILITY OF OFFICIALS AND EMPLOYEES OF THE TOWN............ 16
ATTACHMENT 2 Page i of ii
24. NON- DISCRIMINIATION .............................................................. .............................15
25. INDEPENDENT CONTRACTOR ................................................... .............................16
26. CONFLICT OF INTEREST ............................................................. .............................16
27. MEMORANDUM OF LEASE ......................................................... .............................17
28. ESTOPPEL CERTIFICATE ............................................................ .............................17
29. LIENS ................................................................................................. .............................17
30. VACATING ........................................................................................ .............................17
31. ABANDONMENT ............................................................................. .............................17
32. NOTICES ........................................................................................... .............................17
33. TIME ................................................................................................... .............................18
34. AMENDMENTS ................................................................................ .............................18
35. SIGNING AUTHORITY ................................................................... .............................18
36. CAPTIONS ......................................................................................... .............................18
37. SURRENDER OF LEASE NOT MERGER ................................... .............................18
38. INTEGRATED DOCUMENT ........................................................ ............................... 19
39. WAIVER ............................................................................................. .............................19
40. INTERPRETATIONS ....................................................................... .............................19
41. SEVERABILITY CLAUSE .............................................................. .............................19
42. GOVERNING LAW .......................................................................... .............................19
43. VENUE ................................................................................................ .............................19
44. COMPLIANCE WITH LAWS ......................................................... .............................20
45. BROKERS .......................................................................................... .............................20
46. ATTACHMENTS TO LEASE ....................................................... ............................... 20
EXHIBITS
A DESCRIPTION OF SUBJECT PREMISES ..................................... ............................... 22
B STANDARD INSURANCE REQUIREMENTS ............................... ............................... 23
Page ii of ii
LEASE AGREEMENT
BETWEEN
TOWN OF LOS GATOS
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
This lease agreement (herein "Lease ") is made and entered into this 1 st day of July , 2015, by and
between the Town of Los Gatos, a California municipal corporation (herein "Town ") and Friends of
the Los Gatos Public Library, a California nonprofit corporation (herein "Lessee "). Town and Lessee
may be referred to individually as a "Party" or collectively as the "Parties" or the "Parties to this
Lease." The Town Manager serves as Contract Administrator for this Lease on behalf of the Town
Council.
In consideration of these recitals and the following covenants, terms, and conditions, Lessee and
Town mutually agree as follows:
LEASE PROVISIONS
1. PREMISES.
Town hereby leases to Lessee, certain real property located in the Town of Los Gatos, County of
Santa Clara, State of California, commonly known as 108 E. Main Street (herein the "Premises ") and
more particularly described in Exhibit A attached hereto and incorporated herein by reference. The
Premises consists of approximately one thousand eight hundred and sixty (1,860) square feet of
space for retail book sales. Unless specifically provided, Lessee accepts the Premises "as -is" on the
date of execution of this Lease.
2. TERM.
2.1 Original Tenn. The term of this Lease shall be for eight (8) years, commencing on July
1, 2015 ( "Delivery Date ") and ending on June 30, 2023. Lessee shall, at the expiration of the
term of this Lease, or upon its earlier termination, surrender the Premises in as good
condition as it is now at the date of this lease. The Parties expect reasonable wear and tear.
2.2 Option to Extend. Provided Lessee is not in default hereunder, either at the time of
exercise or at the time the extended term commences, Lessee shall have the option to extend
the initial term of this Lease for two (2) additional periods of five (5) years (`Option Period ")
with the same terms, covenants and conditions provided herein, except that upon such
renewal the Funding Commitment due hereunder shall be adjusted pursuant to Paragraph 4.
Lessee's option shall be exercised by Lessee providing Town with request for an extension in
writing no less than sixty (60) days prior to the expiration of the then current term.
2.3 Early Termination by Town. If Town in its sole discretion determines that it requires
the Premises for any public purpose, Town may terminate this Lease upon ninety (90)
1 Rev. June 2015
days written notice.
3. RENT.
3.1 Base Rent. The rent to be paid by Lessee shall be in the amount of One Dollar ($1.00)
per year.
3.2 Payment Date. Rent shall be payable on the first day of July commencing on the
Delivery Date, and each July 1" thereafter during the term of the Lease and any Lease
extension at Town Hall Finance Department.
4. FUNDING COMMITMENT.
4.1 Lessee shall be obligated to pay to Town on an annual basis the following amounts based
on proceeds from the Lessee's efforts to support the Town of Los Gatos Public Library as established
in Lessee's Library Trust Fund account. All funds paid by the Friends of the Los Gatos Public
Library per the funding commitment will be used as enhancements to the Library budget and are not
intended to offset the general fund contributions to the Library budget. All payments shall be made
payable to the Town quarterly on the following dates: September 30a`, December 31 ", March 31s`,
and June 30th.
Year 1 -8: $35,000
4.2 Increase in Funding. Funding commitment of $35,000 shall be required each year during
any Option Periods. Prior to renewal of the Lease under the Option Periods of this Lease, if
the options are exercised, the Town reserves the right to review the accounts and financial
records of the Lessee and open negotiations for potential increased funding.
4.3 Reporting. Lessee shall be obligated to provide to Town Manager an annual audited
financial statement within five days of completion of such report and provide quarterly
performance reports to Town Manager in a timely manner.
5. USE OF PREMISES and OPERATING HOURS.
5.1 Required Uses. Throughout the term of this Lease, Lessee shall provide the following
uses, services and activities ( "Required Uses "):
5. 1.1 Uses consistent with Lessee's business purposes which includes retail sales of
used and new books, ancillary items (cards, t- shirts, paper, and similar products), and
museum merchandise.
5.1.2 1,860 square feet of space on the upper level of the old Town of Los Gatos
Rev. June 2015
Library located at 108 Main Street, Los Gatos, CA, as shown on Exhibit A.
5.1.3 Meeting rooms for public use consistent with current purposes of the Friends
of the Library maybe reserved in accordance with Town policies at cost. Lessee may request
to reserve the conference room in the new public library and the outdoor Town deck adjacent
to Lessee's space in accordance with policies that will be adopted.
5.2 Hours of Operations.
5.2.1 Public Howl. The Premises shall be closed to the Public on Wednesdays.
Public hours on all other days shall be established to conform to hours of existing Los Gatos
Public Library and, will be modified to conform to schedule changes made by the Los Gatos
Public Library in the future. The Premises may remain open outside of Library hours on
Sundays, during Music in the Park.
5.2.3 Staff Hours. The Premises shall remain closed and unavailable to all operations
and staff on Wednesdays prior to 1:00 p.m. The Premises shall be available to Lessee staff
otherwise during regular Town Hall and Los Gatos Public Library business hours.
5.2.4 Special Events. Lessee shall be obligated to apply for the Permit in accordance
with Town rules and regulations and pay all associated costs and fees for any event that
meets the criteria set forth by Town Code. Alcohol (beer & wine only) may be allowed in
conjunction with approval of a Special Events Permit, subject to all regulations required by
the Los Gatos Police Department. For those events that do not meet the criteria requiring a
Special Event Permit, but do impact parking at the Civic Center, Lessee shall coordinate with
the Town Manager's office to avoid conflicts during business hours or when Town events or
meetings are scheduled.
5.3 Prohibited Uses. Lessee shall not use Premises for any purpose not expressly permitted
hereunder. Lessee shall not create, cause, maintain or permit any nuisance or waste in, on, or
about the Premises, or permit or allow the Premises to be used for any unlawful or immoral
purpose. Lessee shall not do or permit to be done anything in any manner which
unreasonably disturbs the users of the Town Property or the occupants of neighboring
property. Specifically, and without limiting the above, Lessee agrees not to cause any
unreasonable odor, noise, vibration, power emission, or other item to emanate from the
Premises. No materials or articles of any nature shall be stored outside upon any portion of
the Premises. Lessee will not use Premises in a manner that increases the risk of fire, cost of
fire insurance or improvements thereon. No unreasonable sign or placard shall be painted,
inscribed or placed in or on said Premises; and no tree or shrub thereon shall be destroyed or
removed or other waste committed of said Premises. No bicycles, motorcycles, automobiles
or other mechanical means of transportation shall be placed or stored anywhere on the
Premises. No repair, overhaul or modification of any motor vehicle shall take place on the
Premises or the street in front of said Premises. Lessee, at his/her expense, shall keep the
Premises in as good condition as it was at the beginning of the terms hereof, except damage
3 Rev. June 2015
occasioned by ordinary wear and tear, and except damage to the roof, sidewalks and
underground plumbing, which is not the fault of Lessee.
5.4 Condition, Use of Premises. Town makes no warranty or representation of any kind
concerning the condition of the Premises, or the fitness of the Premises for the use intended
by Lessee, and hereby disclaims any personal knowledge with respect thereto, it being
expressly understood by the parties that Lessee has personally inspected the Premises, knows
its condition, finds it fit for Lessee's intended use, accepts it as is, and has ascertained that it
can be used exclusively for the limited purposes specified in Section 5.1.
5.5 Parking. Lessee shall be obligated to purchase Olive Zone parking permits annually from
Town for all employees and shared permits for volunteers working over 20 hours or more on
weekdays. Lessee's employees and volunteers will comply with the same parking
requirements consistent with Town employees.
5.6 Coordination with Town. Lessee shall schedule, attend, and fully participate in quarterly
meetings with Town Manager and /or Manager's designee to address any and all conditions of
this Agreement or any other matter which arises in conjunction with the use of the Premises.
Lessee shall also be required to participate in Town Emergency Preparedness training and
exercises.
6. [reserved]
UTILITIES AND OPERATING EXPENSES.
7.1 Lessee Obligations. Lessee at Lessee's sole expense shall fully and promptly pay for all
expenses associated with the operation of the Premises, including but not limited to the
furnishing of gas, water, sewer, electricity, telephone service, garbage pickup and disposal,
other public utilities and custodial service. Lessee shall be obligated to pay a pro -rated share
based on square footage for gas, water, sewer, electricity, garbage service and other public
utilities provided by or through the Town. Lessee shall be obligated to pay their own direct
costs for telephone, technology, audio - visual, custodial or other specialized services,
including any initial costs for those services. Town shall maintain all exterior landscaping.
7.2 Custodial Services. Lessee at Lesses's sole expense shall fully maintain and pay for all
custodial services to maintain the interior premises in a clean and safe manner. All vendors
for custodial services shall be bonded, insured, and the Town named as an additional insured.
Proof of bond and insurance including the additional insured certificate shall be provided to
Town prior to any custodial services being performed.
8. TAXES.
8.1 Payment of Real Property uxes. Town shall pay Lessee's share of all real property taxes
which become due and payable.
Rev. June 2015
8.3 Revenue and Taxation Code. Lessee specifically acknowledges it is familiar with section
107.6 of the California Revenue and Taxation Code. Lessee realizes that a possessory
interest subject to property taxes may be created, agrees to pay any such tax, and hereby
waives any rights Lessee may have under said California Revenue and Taxation Code section
107.6.
8.4 Personal Property Taxes, Lessee shall pay before delinquent, or if requested by Town,
reimburse Town for, any and all taxes, fees, and assessments associated with the Premises,
the personal property contained in the premises and other taxes, fees, and assessments
regarding any activities which take place at the Premises. Lessee recognizes and understands
in accepting this Lease that its interest therein may be subject to a possible possessory
interest tax that Town or County may impose on such interest and that such tax payment shall
not reduce any rent due Town hereunder and any such tax shall be the liability of and be paid
by Lessee.
9. MAINTENANCE.
9.1 Town and Lessee Responsibilities. Lessee at Lessee's expense, shall perform all interior
maintenance and repairs, including all painting, necessary to keep the Premises in first -class
order, repair, and condition, and shall keep the Premises in a safe, clean, wholesome, and
sanitary condition to the complete satisfaction of Town, and in compliance with all
applicable laws, throughout the term of this Lease. In addition, Lessee shall maintain, at
Lessee's expense, all equipment, furnishings and trade fixtures upon the Premises required
for the maintenance and operation of first -class public services of the type to be conducted
pursuant to this Lease. Routine interior plumbing and electrical maintenance (e.g., plugged
toilets /sinks, faulty switches /lights) will be the responsibility of the Lessee. Town shall be
responsible for the routine maintenance and repair of the exterior structure of the Premises
and main support systems, including roof repair, exterior painting and structural repairs,
excluding any maintenance or repairs resulting from Lessee's actions or activities. Eternal
windows broken or cracked from the exterior will be the responsibility of the Town,
excluding broken windows resulting from Lessee's actions or activities, while windows
broken from the interior will be the responsibility of the Lessee; when the source or cause of
breakage is indeterminate, the costs will be shared.
9.2 Waiver of Civil Code. Lessee expressly waives the benefit of any statute now or
hereinafter in effect, including the provisions of sections 1941 and 1942 of the Civil Code of
California, which would otherwise afford Lessee the right to make repairs at Town's expense
or to terminate this Lease because of Town's failure to keep Premises in good order,
condition and repair. Lessee further agrees that if and when any repairs, alterations, additions
or betterments shall be made by Lessee as required by this paragraph, Lessee shall promptly
pay for all labor done or materials furnished and shall keep the Premises free and clear of any
lien or encumbrance of any kind whatsoever. If Lessee fails to make any repairs or perform
any maintenance work for which Lessee is responsible within a reasonable time (as
5 Rev. ,Tune 2015
determined by the Town Manager in the Town Manager's sole discretion) after demand by
the Town, Town shall have the right, but not the obligation, to make the repairs at Lessee's
expense; within ten (10) days of receipt of a bill, Lessee shall reimburse Town for the cost of
such repairs, including a fifteen percent (15 %) administrative overhead fee. The making of
such repairs or performance of maintenance by Town shall in no event be construed as a
waiver of the duty of Lessee to make repairs or perform maintenance as provided in this
Section.
9.3 Maintenance of Common Areas. Town shall maintain or cause to be maintained,
including repair and replacement as necessary, the exterior grounds, exterior shared deck, and
the parking lot adjacent to the Premises. If Lessee uses the shared deck for activities or a
special event, Lessee shall promptly remove all structures, fixtures, accessories, decorations
and trash associated with the activity or event.
10. TENANT IMPROVEMENTS.
10.1 Improvements Permitted. Subject to prior written approval of the Town Manager,
which shall not be unreasonably withheld, Lessee shall be entitled to install improvements in
an efficient and workmanlike manner within the Premises, at no cost to Town. All costs of
plans, improvements, and permits shall be the sole responsibility of the Lessee. All structural
improvements and improvements in excess of $5,000 must be approved in writing by the
Town Manager.
10.2 Cost of Improvements. All tenant improvements shall be made at Lessee's sole
expense.
10.3 Ownership of Improvements. All improvements constructed, erected, or installed upon
the Premises must be free and clear of all liens, claims, or liability for labor or material and
shall become the property of Town, at its election, upon expiration or earlier termination of
this lease and upon Town's election, shall remain upon the Premises upon termination of this
Lease. Title to all free standing equipment, furniture, furnishings, and trade fixtures placed
by Lessee upon the Premises shall remain in Lessee's ownership, and replacements,
substitutions and modifications thereof may be made by Lessee throughout the term of this
Lease.
10.4 Indemnity for Claims Arising Out of Construction. Lessee shall defend and indemnify
Town against all claims, liabilities, and losses of any type arising out of work performed on
the Premises by Lessee, together with reasonable attorneys' fees and all costs and expenses
reasonably incurred by Town in negotiating, settling, defending or otherwise protecting
against such claims.
10.5 Certificate of Inspection. Upon completion of construction of any building, Lessee
shall submit to the Town Manager a Certificate of Inspection, verifying that the construction
was completed in conformance with Title 20 of the California Code of Regulations for
residential construction, or in conformance with Title 24 of the California Code of
Rev. June 2015
Regulations for non - residential construction.
10.6 As Built Plans. Lessee shall provide the Town Manager with a complete set of
reproducible "as built plans" reflecting actual construction within or upon the Premises upon
completion of any: (i) new construction; (ii) structural alterations; or, (iii) non - structural
alterations costing more than $25,000.
11. ALTERATIONS BY LESSEE
Lessee shall not make any alterations or improvements to the Premises without obtaining the prior
written consent of the Town Manager. Lessee may, at any time and at its sole expense, install and
place business fixtures and equipment within the Premises, provided such fixtures and installation
have been reviewed and approved by the Town Manager.
12. HOLD HARMLESS /INDEMNIFICATION.
12.1 Indemnification. To the extent permitted by law, Lessee agrees to protect, defend, hold
harmless and indemnify Town, its Town Council, commissions, officers, agents, volunteers,
and employees from and against any claim, injury, liability, loss, cost, and /or expense or
damage, however same may be caused, including all costs and reasonable attorney's fees in
providing a defense to any claim arising therefrom for which Town shall become legally
liable arising from Lessee's negligent, reckless, or wrongful acts, errors, or omissions with
respect to or in any way connected with this Lease. Lessee shall give Town immediate notice
of any claim or liability hereby indemnified against. This indemnity shall be in addition to
the Hazardous Materials indemnity contained in this Lease and shall survive shall survive the
expiration of or early termination of the Lease Term.
12.2 Waiver of Claims. Lessee waives any claims against Town for injury to Lessee's
business or any loss of income therefrom, for damage to Lessee's property, or for injury or
death of any person in or about the Premises or the Town Property, from any cause
whatsoever, except to the extent caused by Town's active negligence or willful misconduct.
13. DAMAGE DESTRUCTION AND TERMINATION.
13.1 Nontermination and Nonabatement. Except as provided herein, no destruction or
damage to the Premises by fire, windstorm or other casualty, whether insured or uninsured,
shall entitle Lessee to terminate this Lease. Town and Lessee waive the provisions of any
statutes which relate to termination of a lease when leased property is destroyed and agree
that such event shall be governed by the terms of this Lease.
13.2 Force Majeure. Prevention, delay or stoppage due to strikes, lockouts, labor disputes,
Acts of God, inability to obtain labor, inability to obtain materials or reasonable substitutes,
governmental restrictions, governmental regulation, governmental controls, judicial orders,
enemy or hostile governmental actions, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of Lessee (financial inability excepted), shall excuse
7 Rev. June 2015
the performance by Lessee for a period equal to the prevention, delay, or stoppage, except the
obligations imposed with regard to rent to be paid by Lessee pursuant to this Lease. In the
event any work performed by Lessee or Lessee's contractors results in a strike, lockout,
and/or labor dispute, the strike, lockout, and /or labor dispute shall not excuse the
performance by Lessee of the provisions of this Lease.
13.3 Restoration of Premises by Lessee.
13.3.1 Destruction Due to Risk Covered by Insurance. If, during the term, the
Premises are totally or partially destroyed from a risk covered by the
insurance described in Section 20 (Insurance), rendering the Premises totally
or partially inaccessible or unusable, Lessee shall restore the Premises to
substantially the same condition as it was in immediately before destruction,
whether or not the insurance proceeds are sufficient to cover the actual cost of
restoration. Such destruction shall not terminate this Lease. If the laws
existing at that time do not permit the restoration, either party can terminate
this Lease immediately by giving notice to the other party.
A. Minor Loss. If, during the term of this Lease, the Premises are destroyed
from a risk covered by the insurance described in Section 20 (Insurance), and
the total amount of loss does not exceed twenty thousand dollars ($20,000),
Lessee shall make the loss adjustment with the insurance company insuring
the loss. The proceeds shall be paid directly to Lessee for the sole purpose of
making the restoration of the Premises in accordance with this Lease.
B. Major Loss- Insurance Trustee. If, during the term of this Lease, the
Premises are destroyed from a risk covered by the insurance described in
Section 20 (Insurance), and the total amount of loss exceeds the amount set
forth in paragraph (1), Lessee shall make the loss adjustment with the
insurance company insuring the loss and on receipt of the proceeds shall
immediately pay them to an institutional lender or title company as may be
jointly selected by the parties ( "the Insurance Trustee ").
13.3.2 Destruction Due to Risk Not Covered by Insurance. If, during the term, the
Premises are totally or partially destroyed from a risk covered by the
insurance described in Section 20 (Insurance), rendering the Premises totally
or partially inaccessible or unusable, Lessee shall restore the Premises to
substantially the same condition as it was in immediately before destruction,
whether or not the insurance proceeds are sufficient to cover the actual cost of
restoration. Such destruction shall not terminate this Lease. If the laws
existing at that time do not permit the restoration, either party can terminate
this Lease immediately by giving notice to the other parry.
If the cost of restoration exceeds ten percent (10 %) of the then replacement
value of the Premises totally or partially destroyed, Lessee can elect to
8 Rev. June 2015
terminate this Lease by giving notice to Town within sixty (60) days after
determining the restoration cost and replacement value. if Lessee elects to
terminate this Lease, Town, within thirty (30) days after receiving Lessee's
notice to terminate, can elect to pay to Lessee, at the time Town notifies
Lessee of its election, the difference between ten percent (10 %) of the
replacement value of the Premises and the actual cost of restoration, in which
case Lessee shall restore the Premises. On Town's making its election to
contribute, each party shall deposit immediately the amount of its
contribution with such institutional lender or title company as maybe jointly
selected by the parties ( "the Insurance Trustee "). If the Destruction does not
exceed ten percent (10 %) of the then replacement value of the Premises,
Lessee shall immediately deposit the cost of restoration with the Insurance
Trustee as provided in Exhibit (c). This Lease shall terminate if Lessee elects
to terminate this Lease and Town does not elect to contribute toward the cost
of restoration as provided in this section.
If the Premises are destroyed from a risk not covered by the insurance
described in Section 20 (Insurance), and Lessee has the obligation to restore
the Premises as provided in subsection (B), both parties shall deposit with the
Insurance Trustee their respective contributions toward the cost of
restoration. All sums deposited with the Insurance Trustee shall be held for
the following purposes and the Insurance Trustee shall have the following
powers and duties:
The sums shall be paid in installments by the Insurance Trustee to the
contractor retained by Lessee as construction progresses, for payment of the
cost of Restoration. A 10% retention fund shall be established that will be
paid to the contractor on completion of restoration, payment of all costs,
expiration of all applicable lien periods, and proof that the Premises are free
of all mechanics' liens and lienable claims.
Payments shall be made on presentation of certificates or vouchers from the
architect or engineer retained by Lessee showing the amount due. If the
Insurance Trustee, in its reasonable discretion, determines that the certificates
or vouchers are being improperly approved by the architect or engineer
retained by Lessee, the Insurance Trustee shall have the right to appoint an
architect or an engineer to supervise construction and to make payments on
certificates or vouchers approved by the architect or engineer retained by the
Insurance Trustee. The reasonable expenses and charges of the architect or
engineer retained by the Insurance Trustee shall be paid by the insurance
trustee out of the trust fund. Both parties shall promptly execute all
documents and perform all acts reasonably required by the Insurance Trustee
to perform its obligations under this section.
If the sums held by the Insurance Trustee are not sufficient to pay the actual
9 Rev. June 2015
cost of restoration Lessee shall deposit the amount of the deficiency with the
Insurance Trustee within fifteen (15) days after request by the Insurance
Trustee indicating the amount of the deficiency. Any undisbursed funds after
compliance with the provisions of this section shall be delivered to Town to
the extent of Town's contribution to the fund, and the balance, if any, shall be
paid to Lessee. All actual costs and charges of the Insurance Trustee shall be
paid by Lessee.
If the Insurance Trustee resigns or for any reason is unwilling to act or
continue to act, Town shall substitute a new trustee in the place of the
designated Insurance Trustee. The new trustee must be an institutional lender
or title company.
13.3.3 Procedure for Restoring Premises. When Lessee is obligated to restore the
Premises within sixty (60) days Lessee at its cost shall prepare final plans,
specifications, and working drawings complying with applicable Laws that
will be necessary for restoration of the Premises. The plans, specifications,
and working drawings must be approved by Town. Town shall have thirty
(30) days after receipt of the plans and specifications and working drawings
to either approve or disapprove the plans, specifications, and working
drawings and return them to Lessee. If Town disapproves the plans,
specifications, and working drawings, Town shall notify Lessee of its
objections and Town's proposed solution to each objection. Lessee
acknowledges that the plans, specifications, and working drawings shall be
subject to approval of the appropriate governmental bodies and that they will
be prepared in such a manner as to obtain that approval.
The restoration shall be accomplished as follows
A. Lessee shall complete the restoration within 60 working days after final
plans and specifications and working drawings have been approved by the
appropriate governmental bodies and all required permitshavebeen obtained
(subject to a reasonable extension for delays resulting from causes beyond
Lessee's reasonable control).
B. Lessee shall retain a licensed contractor that is bondable. The contractor
shall be required to carry public liability and property damage insurance,
standard fire and extended coverage insurance, with vandalism and malicious
mischief endorsements, during the period of construction in accordance with
Section 20 (Insurance). Such insurance shall contain waiver of subrogation
clauses in favor of Town and Lessee in accordance with the Provisions of
Exhibit B.
C. Lessee shall notify Town of the date of commencement of the restoration
at least ten (10) days before commencement of the restoration to enable Town
10 Rev. June 2015
to post and record notices of nonresponsibility. The contractor retained by
Lessee shall not commence construction until a completion bond and a labor
and materials bond have been delivered to Town to insure completion of the
construction.
D. Lessee shall accomplish the restoration in a manner that will cause the
least inconvenience, annoyance, and disruption at the Premises.
E. On completion of the restoration Lessee shall immediately record a notice
of completion in the county in which the Premises are located.
F. The restoration shall not be commenced until sums sufficient to cover the
cost of restoration are placed with the Insurance Trustee as provided in this
section.
14. SIGNS AND MARKETING.
14.1 Lessee shall not place, construct, maintain, or allow any signs affixed to the building or
to the exterior of the Premises without prior written consent of the Town following Town
Council review and approval. Lessee shall submit an application to the Community
Development Department and, be obligated to pay all costs associated with any application
process required to obtain approval for any signs.
14.2 Lessee shall not place, construct, maintain, or allow any other signs, including minor
ones, visible to the exterior of the Premises without prior written consent of the Town
Manager. Lessee shall submit an application to the Community Development Department
and, be obligated to pay all costs associated with any application process required to obtain
approval for any signs. Lessee shall include the Town logo on items related to marketing
programs operated, conducted, sponsored, in whole or in part, by Lessee on the Premises,
subject to Town Manager review. Exterior or otherwise visible signage shall be subject to
the Town's naming policy and donation policy.
14.3 Town shall include references to Lessee on signs and marketing programs prepared by
or for Town in association with Lessee's operations on the Premises.
15. ASSIGNMENT AND SUBLETTING.
15.1 Town's Consent Required. Lessee shall not assign this Lease, nor any interest therein,
and shall not sublet or encumber the Premises or any part thereof, nor any right or privilege
appurtenant thereto, nor allow or permit any other person(s) to occupy or use the Premises, or
any portion thereof, without the prior written consent of Town. This Lease shall be binding
upon any permitted assignee or successor of Lessee. Consent by Town to one assignment,
subletting, occupation or use by another person shall not be deemed to be consent to any
11 Rev. June 2015
subsequent assignment, subletting, occupation or use by another person. No assignment,
subletting, or encumbrance by Lessee shall release it from or in any way alter any of Lessee's
obligations under this Lease. Lessee may have the Premises delivered to a subsidiary
company of Lessee, but such arrangement shall in no way alter Lessee's responsibilities
hereunder with respect to the Premises. Any assignment, subletting, encumbrances,
occupation, or use contrary to the provisions of this Lease shall be void and shall constitute
breach of this Lease. Town may assign any of its rights hereunder without notice to Lessee.
15.2 No Release of Lessee. No subletting or assignment as approved by Town shall release
Lessee of Lessee's obligation or alter the primary liability of Lessee to pay the rent and to
perform all other obligations by Lessee hereunder. The acceptance of rent by Town from any
other person shall not be deemed to be a waiver by Town of any provision hereof. In the
event of default by any assignee of Lessee or any successor of Lessee in the performance of
any of the terms hereof, Town may proceed directly against Lessee without the necessity of
exhausting remedies against said assignee.
16. DEFAULTS; REMEDIES.
16.1 Defaults. The occurrence of any one or more of the following events shall constitute a
material default, or breach of this Lease, by Lessee:
16.1.1 Abandonment of the Premises by Lessee as defined by California Civil Code
section 1951.3;
16.1.2 Failure by Lessee to make any payment of rent or any other payment required
to be made by Lessee hereunder, as provided in this Lease, where such failure shall
continue for a period of ten (10) business days after written notice thereof from Town
to Lessee. In the event Town serves Lessee with a Notice to Pay Rent or Quit
pursuant to applicable Unlawful Detainer statutes, such Notice to Pay Rent or Quit
shall also constitute the notice required by this subparagraph;
16.1.3 Failure by Lessee to observe or perform any of the covenants, conditions or
provisions of this Lease in any material respect where such failure shall continue for
a period of thirty (30) days after written notice thereof from Town to Lessee;
provided, however, that if the nature of Lessee's default is such that more than thirty
(30) days are reasonably required for its cure, then Lessee shall not be deemed to be
in default if Lessee commenced such cure within said thirty (30) day period and
thereafter diligently prosecutes such cure to completion;
16.1.4 Making by Lessee of any general arrangement or assignment for the benefit of
creditors; Lessee's becoming a "debtor" as defined in 11 U.S.C. §101 or any
successor statute thereto (unless, in the case of a petition filed against Lessee, the
same is dismissed within sixty (60) days); the appointment of a bankruptcy trustee or
receiver to take possession of all or substantially all of Lessee's assets located at or
on the Premises or of Lessee's interest in this Lease where possession is not restored
12 Rev. June 2015
to Lessee within thirty (30) days; or the attachment, execution or other judicial
seizure of all or substantially all of Lessee's assets located at or on the Premises or of
Lessee's interest in this Lease, where such seizure is not discharged within thirty (30)
days.
16.1.5 Failure to make the Funding Commitment payments as required under this
Lease Agreement for a period of six (6) months or more.
16.2 Remedies. In the event of any material default or breach by Lessee, Town may at any
time thereafter, following any notice required by statute, and without limiting Town in the
exercise of any right or remedy which Town may have by reason of such default or breach:
16.2.1 Terminate Lessee's right to possession of the Premises by any lawful means,
in which case this Lease shall terminate and Lessee shall immediately surrender
possession of the Premises and Improvements to Town. In such event, Town shall be
entitled to recover from Lessee all damages incurred by Town by reason of Lessee's
default including but not limited to: the cost of recovering possession of the Premises
and Improvements; expenses of reletting, including necessary renovation and
alteration of the Premises and Improvements; reasonable attorneys' fees; the worth at
the time of the award of the unpaid rent that had been earned at the time of
termination of this Lease and the worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the time of such award exceeds the
amount of such rental loss for the same period that Lessee proves could be reasonably
avoided.
16.2.2 Maintain Lessee's right to possession, in which case this Lease shall continue
in effect whether or not Lessee shall have abandoned the Premises. In such event,
Town shall be entitled to enforce all of Town's rights and remedies under this Lease,
including the right to recover rent and other payments as they become due hereunder.
16.2.3 Pursue any other remedy now or hereafter available to Town under the laws
or judicial decisions of the State of California. Town shall have all remedies
provided by law and equity.
16.3 No Relief from Forfeiture After Default. Lessee waives all rights of redemption or
relief from forfeiture under California Code of Civil Procedure sections 1174 and 1179, and
any other present or future law, in the event Lessee is evicted or Town otherwise lawfully
takes possession of the Premises by reason of any default or breach of this Lease by Lessee.
16.4 Disposition of Abandoned Personal Propert y. If the Lessee fails to remove any personal
property belonging to Lessee from the Premises after forty -five (45) days of the expiration or
termination of this Lease, such property shall at the option of Town be deemed to have been
transferred to Town. Town shall have the right to remove and to dispose of such property
without liability to Lessee or to any person claiming under Lessee, and the Town shall have
no need to account for such property.
13 Rev. June 2015
17. INTEREST ON PAST -DUE OBLIGATIONS.
Except as expressly provided herein, any amount due Town when not paid when due shall bear
interest at the lesser of ten percent (10 %) per year or the maximum rate then allowable by law from
the date due.
18. HOLDING OVER.
If Lessee remains in possession of the Premises or any part thereof after the expiration of the term or
option term hereof, such occupancy shall be a tenancy from month to month with all the obligations
of this Lease applicable to Lessee and at a monthly rental obligation at the market rate in effect at the
time of expiration. Nothing contained in this Lease shall give to Lessee the right to occupy the
Premises after the expiration of the term, or upon an earlier termination for breach.
19. TOWN'S ACCESS.
19.1 Access for Inspection. Town and Town's agents shall have the right to enter the
Premises at reasonable times, upon not less than twenty -four (24) hours prior notice to
Lessee, for the purpose of inspecting same, showing same to prospective purchasers, lenders
or lessees, and making such alterations, repairs, improvements, or additions to the Premises
as Town may deem necessary.
19.2 Security Measures. Town shall have the right to require a reasonable security system,
device, operation, or plan be installed and implemented to protect the Premises or the
Improvements. Should Town, in its sole discretion, require Lessee to install such a security
system, Lessee agrees to bear the sole cost and expense of any security system, device,
operation or plan and the installation and implementation thereof. Lessee shall obtain
Town's prior approval before installing, implementing or changing any Town approved
security system, device, operation or plan.
19.3 New Locks. Lessee may not install new locks on any doors without the express written
consent of the Town. Lessee shall advise Town of such action and shall provide Town with
keys to said locks. Lessee shall also deliver to Town the old locks with keys. Upon
termination, Lessee shall leave new locks that shall become the property of Town.
20. INSURANCE.
Lessee's responsibility for the Premises begins immediately upon delivery and Lessee, at its sole cost
and expense, and at no cost to Town, shall purchase and maintain in full force and effect during the
entire term of this Lease insurance coverage in amounts and in a form acceptable to Town as set
forth in Exhibit C attached hereto and incorporated herein by reference. Said policies shall be
maintained with respect to Lessee's employees, if any, and all vehicles operated on the Premises.
The policies shall include the required endorsements, certificates of insurance and coverage
verifications as described in Exhibit C.
14 Rev. June 2015
Lessee shall be responsible for all losses incurred for any reason of its personal property or contents
on Premises. Lessee may want to consider securing renter's liability insurance.
Lessee shall deposit with the Town Manager, on or before the effective date of this Lease, certificates
of insurance necessary to satisfy Town that the insurance provisions of this Lease have been
complied with, and to keep such insurance in effect and the certificates therefore on deposit with
Town during the entire term of this Lease. Should Lessee not provide evidence of such required
coverage at least three (3) days prior to the expiration of any existing insurance coverage, Town may
purchase such insurance, on behalf of and at the expense of Lessee to provide six months of
coverage.
Town shall retain the right at any time to review the coverage, form, and amount of the insurance
required hereby. If, in the opinion of the Town's Risk Manager (or comparable official), the
insurance provisions in this Lease do not provide adequate protection for Town and for members of
the public using the Premises, the Town Manager may require Lessee to obtain insurance sufficient
in coverage, form, and amount to provide adequate protection as determined by the Risk Manager.
Town's requirements shall be reasonable and shall be designed to assure protection from and against
the kind and extent of risk that exists at the time a change in insurance is required.
The Town Manager shall notify Lessee in writing of changes in the insurance requirements. If
Lessee does not deposit copies of acceptable insurance policies with Town incorporating such
changes within sixty (60) days of receipt of such notice, or in the event Lessee fails to maintain in
effect any required insurance coverage, Lessee shall be in default under this lease without further
notice to Lessee. Such failure shall constitute a material breach and shall be grounds for immediate
termination of this Lease at the option of Town.
The procuring of such required policy or policies of insurance shall not be construed to limit
Lessee's liability hereunder nor to fulfill the indemnification provision and requirements of this
Lease. Notwithstanding the policy or policies of insurance, Lessee shall be obligated for the full and
total amount of any damage, injury, or loss caused by or connected with this Lease or with use or
occupancy of the Premises.
21. [reserved]
22. DISPUTE RESOLUTION.
22.1 Unless otherwise mutually agreed to, any controversies between Lessee and Town
regarding the construction or application of this Lease, and claims arising out of this Lease or
its breach shall be submitted to mediation within thirty (30) days of the written request of
one Party after the service of that request on the other Party.
22.2 The Parties may agree on one mediator. If they cannot agree on one mediator, the Parry
demanding mediation shall request the Superior Court of Santa Clara County to appoint a
mediator. The mediation meeting shall not exceed one day (eight (8) hours). The Parties may
15 Rev. June 2015
agree to extend the time allowed for mediation under this Lease.
22.3 The costs of mediation shall be borne by the Parties equally.
22.4 Mediation under this section is a condition precedent to filing an action in any court. In
the event of litigation arising out of any dispute related to this Lease, the Parties shall each
pay their respective attorney's fees, expert witness costs and cost of suit, regardless of the
outcome of the litigation.
23. NON - LIABILITY OF OFFICIALS AND EMPLOYEES OF THE TOWN.
No official or employee of Town shall be personally liable for any default or liability under this
agreement.
24. NON - DISCRIMINATION
24.1 Non - discrimination in Lease Activities. Lessee agrees that in the performance of this
Lease and in connection with all of the activities Lessee conducts on the Premises, it shall not
discriminate against any employee or person because of the race, skin color, gender, age, religion,
disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status,
weight or height of such person. Lessee acknowledges that is familiar with the provisions set forth in
Section 2.30.510 of the Los Gatos Municipal Code relating to nondiscrimination in employment and
Section 9.73 of the Los Gatos Municipal Code relating to Town policy against arbitrary
discrimination.
24.2 Human Rights Policy. In connection with all activities that are conducted upon the
Premises, Lessee agrees to accept and enforce the statements of policy set forth in Section 9.73.010
which provides: "It is the policy of the Town of Los Gatos to affirm, support and protect the human
rights of every person within its jurisdiction. These rights include, but are not limited to, equal
economic, political, and educational opportunity; equal accommodations in all business
establishments in the Town; and equal service and protection by all public agencies of the Town."
25. INDEPENDENT CONTRACTOR.
It is agreed that Lessee shall act and be an independent contractor and not an agent nor employee of
Town.
26. CONFLICT OF INTEREST.
Lessee shall at all times avoid conflict of interest or appearance of conflict of interest in performance
of this agreement. Lessee warrants and covenants that no official or employee of Town nor any
business entity in which any official or employee of Town is interested: (1) has been employed or
retained to solicit or aid in the procuring of this agreement; or (2) will be employed in the
performance of this agreement without the divulgence of such fact to Town. In the event that Town
determines that the employment of any such official, employee or business entity is not compatible
16 Rev. June 2015
with such official's or employee's duties as an official or employee of Town, Lessee upon request of
Town shall immediately terminate such employment. Violation of this provision constitutes a
serious breach of this Lease and Town may terminate this Lease as a result of such violation.
27. MEMORANDUM OF LEASE.
Following execution of this Lease, Town shall be entitled to record a Memorandum of Lease in the
official records of Santa Clara County. Upon termination or expiration of this Lease, Lessee shall
execute and record a quitclaim deed as to its leasehold interest.
28. ESTOPPEL CERTIFICATE.
Lessee shall, from time to time, upon at least thirty (30) days prior written notice from Town,
execute, acknowledge and deliver to Town a statement in writing: (i) certifying this Lease is
unmodified and in full force and effect, or, if modified, stating the nature of the modification and
certifying that the Lease, as modified, is in full force and effect, and the date to which the rental and
other charges, if any, have been paid; and, (ii) acknowledging that there are not to Lessee's
knowledge, any defaults, or stating if any defaults are claimed, any statement may be relied upon by
any prospective purchaser or encumbrance of the Town Property.
29. LIENS.
Lessee agrees at its sole cost and expense to keep the Premises free and clear of any and all claims,
levies, liens, encumbrances or attachments.
30. VACATING.
Upon termination of the tenancy, Lessee shall completely vacate the Premises, including the removal
of any and all of its property. Before departure, Lessee shall return keys and personal property listed
on the inventory to Town in good, clean and sanitary condition, reasonable wear and tear excepted.
Lessee shall allow Town to inspect the Premises to verify the condition of the Premises and its
contents.
31. ABANDONMENT.
Lessee's absence from the Premises for three (3) consecutive days, without prior notice, during which
time rent or other charges are delinquent, shall be deemed abandonment of the Premises. Such
abandonment will be deemed cause for immediate termination without notice. Town shall thereupon
be authorized to enter and take possession and to remove and dispose of the property of Lessee or its
guests without any liability whatsoever to Town.
32. NOTICES.
All notices to the Parties shall, unless otherwise requested in writing, be sent to Town addressed as
follows:
17 Rev. June 2015
Town of Los Gatos
Attention: Town Manager
110 E. Main Street
Los Gatos, CA 95030
E -Mail: Manager &osGatos ov ov (
And to Lessee addressed as follows:
Friends of the Los Gatos Public Library
Marlene Rodman
100 Villa Ave.
Los Gatos, CA 95030
Facsimile:
E -mail: marlenerodman _,gmail.com
Notices maybe served upon Lessee in person, by first class mail, or by certified mail whether or not
said mailing is accepted by Lessee. If notice is sent via facsimile or e -mail, a signed, hard copy of
the material shall also be mailed. The workday the facsimile was sent shall control the date notice
was deemed given if there is a facsimile machine generated document on the date of transmission. A
facsimile transmitted after 1:00 p.m. on a Friday shall be deemed to have been transmitted on the
following Monday. These addresses shall be used for service of process.
33. TIME.
Time shall be of the essence in this Lease.
34. AMENDMENTS.
It is mutually agreed that no oral Leases have been entered into and that no alteration or variation of
the terms of this Lease shall be valid unless made in writing and signed by the Parties to this Lease.
35. SIGNING AUTHORITY.
If this Lease is not signed by all Lessees named herein, the person actually signing warrants that
he /she has the authority to sign for the others.
36. CAPTIONS.
The captions of the various sections, paragraphs and subparagraphs of this Lease are for convenience
only and shall not be considered or referred to in resolving questions of interpretation.
37. SURRENDER OF LEASE NOT MERGER.
The voluntary or other surrender of this lease by Lessee, or a mutual cancellation thereof, shall not
18 Rev. June 2015
work a merger, and shall, at the option of Town, terminate all or any existing subleases or
subtenancies, or may, at the option of Town, operate as an assignment of any and all such subleases
or subtenancies.
38. INTEGRATED DOCUMENT.
This Lease, including any exhibits attached hereto, embodies the entire agreement between Town
and Lessee. No other understanding, agreements, conversations or otherwise, with any officer, agent
or employee of Town prior to execution of this Lease shall affect or modify any of the terms or
obligations contained in any documents comprising this Lease. Any such verbal agreement shall be
considered as unofficial information and in no way binding upon Town. All agreements with Town
are subject to approval of the Town Council before Town shall be bound thereby.
39. WAIVER.
Waiver by Town of one or more conditions of performance or any breach of a condition under this
Lease shall not be construed as a waiver of any other condition of performance or subsequent
breaches. The subsequent acceptance by a Party of the performance of any obligation or duty by
another Party shall not be deemed to be a waiver of any term or condition of this Lease. The exercise
of any remedy, right, option or privilege hereunder by Town shall not preclude Town from exercising
the same or any and all other remedies, rights, options and privileges hereunder and Town's failure to
exercise any remedy, right, option or privilege at law or equity, or otherwise which Town may have,
shall not be construed as a waiver.
40. INTERPRETATIONS.
In construing or interpreting this Lease, the word "or" shall not be construed as exclusive and the
word "including" shall not be limiting. The Parties agree that this Lease shall be fairly interpreted in
accordance with its terms without any strict construction in favor of or against any other Party.
41. SEVERABILITY CLAUSE.
If any provision of this Lease is held to be illegal, invalid or unenforceable in full or in part, for any
reason, then such provision shall be modified to the minimum extent necessary to make the provision
legal, valid and enforceable, and the other provisions of this Lease shall not be affected thereby.
42. GOVERNING LAW.
This Lease shall be governed and construed in accordance with the statutes and laws of the State of
California.
43. VENUE.
In the event that suit shall be brought by any Party to this Lease, the Parties agree that venue shall be
19 Rev. June 2015
exclusively vested in the state courts of the County of Santa Clara.
44. COMPLIANCE WITH LAWS.
The Parties hereto shall comply with all applicable laws, ordinances, codes and regulations of the
federal, state and local governments in the performance of their rights, duties and obligations under
this Lease.
45. BROKERS.
Each party represents that is has not had dealings with any real estate broker, tinder, or other person,
with respect to this lease in any manner. Each Party shall hold harmless the other party from all
damages resulting from any claims that may be asserted against the other party by any broker, finder,
or other person with whom the Indemnifying Party has or purportedly has dealt.
46. ATTACHMENTS TO LEASE.
The following exhibits are attached to and made a part of this Agreement:
"A" — Description of Subject Premises
B" — Standard Insurance Requirements
20 Rev. June 2015
IN WITNESS WHEREOF, the parties have executed this Lease the day and year first above
written.
TOWN:
TOWN OF LOS GATOS (LESSOR)
Les White, Interim Town Manager
ATTEST:
Town Clerk Administrator
APPROVED AS TO FORM:
Robert Schultz, Town Attorney
TENANT:
FRIENDS OF THE LOS GATOS
PUBLIC LIBRARY
Marlene Rodman, President
21 Rev. ,Tune 2015
LEASE AGREEMENT
BETWEEN
TOWN OF LOS GATOS
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
EXHIBIT A
DESCRIPTION OF SUBJECT PREMISES
Lease Agreement/Friends of Los Gatos Public Library Fxhibit A Page 22 of 25
(INSERT DATE TYPED)
LEASE AGREEMENT
BY AND BETWEEN
TOWN OF LOS GATOS, CALIFORNIA
AND
FRIENDS OF THE LOS GATOS PUBLIC LIBRARY
EXHIBIT B
STANDARD INSURANCE REQUIREMENTS
Insurance Requirements for Lessee:
Lessee shall purchase and maintain the insurance policies set forth below on all of its operations
under this Lease at its sole cost and expense. Such policies shall be maintained for the full term of
this Lease and the related warranty period (if applicable). For purposes of the insurance policies
required under this Lease, the term "Town" shall include the duly elected or appointed council
members, commissioners, officers, agents, employees and volunteers of the Town of Los Gatos,
California, individually or collectively.
Coverages (RL 28.1A) S
Minimum Scone of Insurance
Coverage shall be at least as broad as:
1) Insurance Services Office Commercial General Liability coverage (occurrence form
CG 0001).
2) Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile
Liability, code 1 (any auto).
3) Workers' Compensation insurance as required by the State of California and
Employer's Liability Insurance (for lessees with employees).
4) Property insurance against all risks of loss to any tenant improvements or betterments
The policy or policies of insurance maintained by Lessee shall provide the following limits and
coverages:
POLICY
(1) Commercial General Liability
(2) Automobile Liability
Including Owned, Hired and
Non -Owned Automobiles
Lease Agreement/Friends of the Los Gatos Public Library
(INSERT DATE )
MINIMUM LIMITS OF LIABILITY
$1,000,000 per each occurrence for bodily
injury, personal injury and property damage
$ 1,000,000 Combined Single Limit
Exhibit B Page 23 of 25
(3) Workers' Compensation Statutory
Employers Liability $1,000,000 per accident for bodily injury or
disease
(4) Lessee's Property Insurance
Lessee shall procure and maintain property insurance coverage for:
(a) all office furniture, trade fixture, office equipment, merchandise,
and all other items of Lessee's property in, on, at, or about the
premises and the building, include property installed by, for,
or at the expense of Lessee;
(b) all other improvements, betterments, alterations, and additions
to the premises.
Lessee's property insurance must fulfill the following requirements:
(a) it must be written on the broadest available "all risk" policy form or an
equivalent form acceptable Town of Los Gatos, including earthquake sprinkler
leakage.
(b) for no less than ninety percent (90 %) of the full
replacement cost (new without deduction for depreciation)
of the covered items and property; and
(c) the amounts of coverage must meet any coinsurance
requirements of the policy or policies.
(RL 28.2)
Deductibles and Self- Insured Retentions
Any deductibles or self - insured retentions must be declared to and approved by the Town. At the
option of the Town either: the insurer shall reduce or eliminate such deductibles or self - insured
retentions as respects the Town, its officers, officials, employees and volunteers; or the Lessee shall
procure abond guaranteeing payment of losses and related investigations, claim administration and
defense expenses.
Insurance shall be in full force and effect commencing on the first day of the term of this Lease.
Each insurance policy required by this Lease shall:
Be endorsed to state that coverage shall not be suspended, voided, canceled by either
party, 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 Town.
2. Include a waiver of all rights of subrogation against the Town and the members of the
Town Council and elective or appointive officers or employees, and each party shall
indemnify the other against any loss or expense including reasonable attorney fees,
resulting from the failure to obtain such waiver.
Lease Agreement/Friends of the Los Gatos Public Library Exhibit B Page 24 of 25
(INSERT DATE)
Name the Town of Los Gatos as a loss payee on the property policy.
4. Provide that the Town, its officers, officials, employees, agents and volunteers are to
be covered as insureds as respects: liability arising out of activities performed by or
on behalf of the Lessee; products and completed operations of the Lessee; premises
owned, occupied or used by the Lessee; or automobiles owned, leased, hired or
borrowed by the Lessee. The coverage shall contain no special limitations on the
scope of protection afforded to the Town, its officers, officials, employees, agents or
volunteers.
5. Provide that for any claims related to this Lease, the Lessee's insurance coverage shall
be primary insurance as respects the Town, its officers, officials, employees, agents
and volunteers. Any insurance or self - insurance maintained by the Town, its officers,
officials, employees, agents or volunteers shall be excess of the Lessee's insurance
and shall not contribute with it.
6. Provide that any failure to comply with reporting or other provisions of the policies
including breaches of warranties shall not affect coverage provided to the Town, its
officers, officials, employees, agents or volunteers.
7. Provide that Lessee's insurance shall apply separately to each insured against whom
claim is made or suit is brought, except with respect to the limits of the insurer's
liability.
8. Lessee agrees to promptly pay to Town as Additional Rent, upon demand, the amount
of any increase in the rate of insurance on the Premises or on any other part of
Building that results by reason of Lessee's act(s) or Lessee's permitting certain
activities to take place.
Acceptability of Insurers
All insurance policies shall be issued by California - admitted carriers having current A.M. Best's
ratings of no lower than A -: VII.
Lease Agreement/Friends of the Los Gatos Public Library Exhibit B Page 25 of 25
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