CC SR 20150818 04 - Lease Agreement PV Net AnnexCITY OF tARANCHO
PALOS VERDES
MEMORANDUM
TO: HONORABLE MAYOR & CITY COUNCIL MEMBERS
FROM: CAROLYNN PETRU, DEPUTY CITY MANAGER
DATE: AUGUST 18, 2015
SUBJECT: AMENDMENT TO LEASE AGREEMENT FOR THE
PALOS VERDES ON THE NET "ANNEX"
REVIEWED: DOUG WILLMORE, CITY MANAGER 94
RECOMMENDATION
Approve the Amended and Re -stated Lease Agreement between the City of Rancho
Palos Verdes and Palos Verdes on the Net for premises occupied by the "Annex."
EXECUTIVE SUMMARY
In August 2014, the City provided written notice to Palos Verdes on the Net (PVNET)
that it would terminate its lease for the office and storage building located adjacent to
City Hall effective December 31, 2015. PVNET approached the City earlier this year
with a request to amend its current lease with the City to expand the size of its "Annex"
modular building adjacent to the City's maintenance yard to replace the office and
storage space that it will turn back to the City at the end of the year. PVNET has
indicated that the expansion area will not be used for additional classroom or training
space, but only to accommodate the uses currently housed in the office and storage
building. Staff has prepared the attached Amended and Re -stated Lease Agreement
(Lease) to allow PVNET to place a second modular building of the same size next to the
existing building.
Staff recommends that PVNET not be charged rent for use of the premises, due to the
fact that PVNET is a community-based non-profit organization that provides a variety of
educational and computer training opportunities to the public. Currently, the City pays
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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for the cost of electricity serving the Annex. However, PVNET has indicated that it
intends to install a separate meter and add solar panels on the roof of its facility, thereby
relieving the City of this prior obligation. As PVNET is no longer providing IT Services to
the City, the Lease has been modified so that the City no longer provides two VOIP
telephones to the Annex, and that PVNET is responsible for providing its own custodial
services within the building. Because the Annex's current security alarm system is
integrated with the City's adjacent Emergency Communications Center, the City will
continue to provide this service to both facilities.
The Lease also clarifies maintenance responsibilities for the Annex building, which will
be paid for by PVNET; however, maintenance of the premises where the building is
located will continue to be provided by the City. The Lease also amends the required
notice and procedure in the event the City determines that the Annex must be moved
from its current location to another location at the Civic Center. And finally, PVNET has
requested to change from the current "evergreen" lease term to a minimum four (4) year
term ending on December 31, 2019, but subject to extensions by mutual agreement.
Staff feels that this requested change would still provide the City with enough flexibility
in making future plans for the Civic Center, as the Lease could still be terminated earlier
by either party if written notice is provided by September 1St. In such a case, the Lease
would terminate 12 months later, which is a reduction from the current provision of 16
months.
Overall, the Lease will allow PVNET to continue to operate its non-profit multimedia and
technology learning center at the Civic Center in a contiguous and unified facility. The
Lease also cleans up a number of overlapping provisions that resulted from the
reshuffling of lease space that took place in 2006 and reflects both party's current
circumstances and needs.
FISCAL IMPACT
As is currently the case, the re -stated Lease does not require PVNET to pay monthly
rent to the City for the use of the premises. While the City currently pays for all of the
utilities at the Annex, as part of the new agreement, PVNET will obtain a separate
electrical meter and install solar panels on the roof of the expanded facility, thus saving
the City the cost of continuing to provide electrical service to the Annex (approximately
$8,100 per year). In addition, the City will no longer provide VOIP telephone or
custodial services at the Annex, thereby saving the City an additional $4,400 annually.
The City will maintain the existing security alarm system, since it is integrated with the
system serving the City's Emergency Communications System ($1,000 per year).
Although the cost is unknown, the Lease also requires PVNET to assume the costs
associated with relocating the Annex buildings to another area on the property, should
the City ever have need of the current location.
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BACKGROUND
In 1996, the City Council approved a lease agreement with Palos Verdes on the Net
(PVNET) for use of an approximately 3,000 square foot office and storage building
located next to the Community Development Department. PVNET requested use of the
building to provide information technology education and related services to the
community. In light of the community services provided, the lease merely required
reimbursement for utility expenses.
PVNET began providing the City with day-to-day IT services in 1998, and the City
Council approved an extension and amendment of the original lease to acknowledge
and accommodate the ongoing support and maintenance of the information technology
systems at City Hall in the same building. The lease was further amended in 2006 to
include an automatic annual renewal provision, which requires the City to notify PVNET
in writing by September 1St of an intent to terminate. Once such a notice was issued,
the lease terminates on December 31St of the following year.
In 2006, the City Council also approved a separate ground lease with PVNET allowing
an approximately 1,440 square foot "Annex" modular building to be located adjacent to
the City's maintenance yard. This lease was entered into in exchange for PVNET giving
up a prior agreement to use the City's Cable Studio Building, and also included PVNET
donating audio and video equipment it had previously purchased for the RPVty cable
studio operation. The Annex is used to conduct computer training for the Palos Verdes
Peninsula community, to operate the PVNET internship program and, while PVNET
provided IT services to the City, the Annex was used to support the City's GIS system.
This lease also includes the same automatic annual renewal provision as PVNET's
lease for the office and storage building adjacent to City Hall.
With the issuance of the Request for Proposals (RFP) for Information Technology
Services last year, the City identified the need to potentially regain use of the office and
storage building currently occupied by PVNET in the event there was a change in the
City's IT services provider. Consequently, on August 19, 2014, the City Council
authorized the Acting City Manager to issue a Notice of Termination of Lease for this
building to PVNET, thereby establishing a December 31, 2015 expiration date for
PVNET to relinquish the office and storage building back to the City. PVNET did not
submit a proposal in response to the IT Services RFP and the City Council
subsequently awarded the contract to Prosum, which began providing services to the
City on July 1, 2015.
It should be noted that the two lease agreements for the office and storage building and
the Annex contain a number of overlapping provisions as a result of the reshuffling of
space that took place in 2006. The current request by PVNET to expand the Annex
provides an opportunity to clean up and clarify the lease provisions, based on both
party's current circumstances and needs.
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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SITE DESCRIPTION
PVNET's Annex is located adjacent to and slightly southeast of the City's RPVty Cable
Television Studio on the Point Vicente Park/Civic Center property. The modular
building is approximately 24 feet wide by 60 feet long. At the time the Annex was
established, the City installed a smaller 10 foot by 32 foot modular building next to it, on
the north side and abutting the Annex, to serve as the City's Emergency
Communications Center (ECC). The ECC is shared by the Sheriff's Disaster
Communication Service (DCS) and the Peninsula Volunteer Alert Network (PVAN).
These two volunteer organizations work together to provide emergency ham radio
communications during emergencies and disasters. Both the Annex and ECC modular
buildings are single story, flat roofed, and supported on a raised foundation. An
approximately 500 square foot handicapped accessible ramp is located on the west side
of the two buildings to provide ingress and egress to both buildings.
PROJECT DESCRIPTION
As previously discussed, PVNET's current lease for the office and storage building will
terminate on December 31, 2015. PVNET is requesting to amend the existing 2006
ground lease for the Annex to allow the non-profit to place a second 1,440 square
modular building next to the existing 1,440 square foot building, for a total building
footprint of approximately 2,880 square feet. The second building would have the same
dimensions and would be located on the south side of the existing one. The addition to
the Annex is intended to accommodate the office and storage space currently housed in
the City's building next to the Community Development Department, which will no
longer be available to PVNET after December 31, 2015. PVNET has indicated that it
will not be used for additional classroom or training space. The proposed alignment of
the addition to the Annex is shown in the attached Exhibit A to the Lease.
The Public Works Department has confirmed that there is adequate space available to
accommodate the placement of the additional modular building in this location, while still
allowing access into the City's maintenance yard. The total amount of parking needed
for PVNET in not expected to change, since the PVNET staff and activities currently
taking place in the City's office building would simply move over to the area adjacent to
the maintenance yard. The Public Works Department has determined that there is
adequate space in this area to accommodate the Annex's parking needs, including the
designation of one or more handicapped parking spaces, as needed.
DISCUSSION
The City's relationship with PVNET has changed fundamentally since the lease for the
Annex was first entered into in 2006, as PVNET is no longer the City's IT Services
provider. This fact has a significant impact on several provisions contained within the
existing lease. Therefore, staff is recommending a compete re -statement and re -
adoption of the agreement, rather than a simple amendment. The most significant
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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provisions are discussed below in detail in the order they appear in the Lease.
Section 1: Description of Premises
VOIP Phones
The last sentence in the first paragraph of this section currently reads:
"The Premises have been, or will be, prepared by Landlord, at its sole cost and
expense, for said use, including the installation of two VOIP phones that will be
connected to Landlord's VOIP phone system and utilities to serve the building."
At the time the lease agreement was first executed, PVNET was providing IT services to
the City and having telephone extensions to the Annex that were part of the City Hall's
Voice Over Internet Protocol (VOIP) system made sense. However, now that the City
has a different IT services provider, there is no longer a need for the City to provide
these two VOIP phones to PVNET. In addition, the site was already prepared and
utilities were modified to serve the original modular building in 2006. It is not expected
that the addition of the second modular building will require significant further
preparation or modifications. Therefore, staff recommends striking this sentence from
the Lease.
Relocation of the Buildi
The second paragraph of this section currently reads:
"Landlord may determine, in its sole and reasonable discretion, that construction of
other structures or facilities on the Property or another condition on or adjacent to the
Premises requires the Building to be moved to another equivalent area on the Property.
In that event, Landlord shall provide at least nine months prior written notice to Tenant
of the relocation, and shall pay all costs associated with the relocation of the Building."
(emphasis added)
The Council may wish to consider whether nine (9) months prior written notice is the
appropriate length of time. For comparison, the current lease agreement for the
monopole at City Hall contains provisions to relocate the tower in the event the City
decides to redevelop the property. Per the terms of the agreement, any relocation of
the tower must be completed within sixty (60) days after the lessee receives written
notice from the City. Similarly, the monopole lease agreement requires any and all
costs attributable to such a relocation to be borne and paid for by the lessee. There is
also a provision that allows the lessee to terminate the lease in writing prior to the date
the City would require the lessee to complete the relocation.
Staff recommends modifying this section of the re -stated lease as follows:
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Amendment to PVNET Annex Lease Agreement
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"Landlord may determine, in its sole and reasonable discretion, that construction
of other structures or facilities on the Property or another condition on or
adjacent to the Premises requires the Buildings to be moved to another
equivalent area on the Property. In that event, Landlord shall provide at least six
(6) months prior written notice to Tenant to move the Buildings. All costs
associated with the relocation of the Buildings shall be paid for by Tenant.
Notwithstanding the foregoing, Tenant shall have the option of terminating the
Re -stated Lease by providing Landlord with written notice of its election to do so
within sixty (60) calendar days of receiving Landlord's written notice and shall
vacate the Property within six (6) months of its election to terminate."
Section 2: Use of Premises
The first paragraph of the current lease reads:
"Tenant shall have the right to place its Building on the Premises for use in connection
with its operation of a Multimedia and Information Technology Center in connection with
it existing community telecommunications center, which is operated under the name
Palos Verdes on the Net. Tenant shall not use the Premises for any purpose that is
unrelated to this purpose."
PVNET has indicated that the second modular building will not be used for additional
classroom or training space, but only to accommodate the uses currently housed in the
office and storage building located adjacent to City Hall which will be turned back to the
City as of December 31, 2015. Therefore, staff recommends modifying this section of
the re -stated Lease as follows:
"Tenant shall have the right to maintain its existing modular building on the
Premises and to expand it to add a second modular building as shown in Exhibit
A for use in connection with its operation of a Multimedia and Technology Center,
which is operated under the name Palos Verdes on the Net. The second modular
building shall not be used for additional classroom or training space, and shall
only be used for office and storage space. Tenant shall not use the Premises for
any purpose that is unrelated to the Multimedia and Technology Center."
No other material changes are proposed to this section of the Lease.
Section 3: Access to Premises
The last sentence of this section currently states:
"In addition, Tenant shall provide access to the Premises of the Building on a regular
basis for the performance of Landlord's maintenance and repair obligations specified in
Section 7.2."* (emphasis added)
Al
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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*It should be noted that there is a section numbering error in the current Lease and the reference will be
changed in the re -stated lease to reference Section 6.2.
Staff proposes to strike this sentence based on other changes to Section 6.2 that are
discussed below in Section 7.
Section 4: Term of Re -Stated Lease
After the initial three year term, the current Lease includes the following evergreen
provision:
"This Lease shall automatically renew from year to year thereafter as of the date and
year first written above, unless on or before September 1St of each year, either party
notifies the other party in writing that the party wishes to terminate or amend this Lease.
If such notice is given, the Lease shall be terminated on December 31St of the year
following when the written notice is given."
PVNET has requested to change the evergreen term to a minimum four (4) year term,
as it provides the non-profit with a certain amount of stability to plan its upcoming
educational programs. The City is in the process of updating the Parks Master Plan,
which includes the subject property, and will be embarking on more a detailed land use
study of the property in terms of the City's maintenance yard needs, accommodating
overflow parking for Terranea Resort, and adding a public skate park to the site. The
requested minimum four year term is acceptable to staff, given that the Lease could still
be terminated by either party by written notice provided before September 1St of each
year. However, instead of providing 16 months prior written notice, staff recommends a
shorter timeline of 12 months to provide more flexibility to the City, while still providing
PVNET with a reasonable amount of notice, as reflected in the following language in the
restated Lease:
"The term of this Re -stated Lease shall be for a period of four (4) years and four
(4) months commencing on September 1, 2015, and terminating on December 31,
2019. On or before September 1St of each year, either party has the right to notify
the other party in writing that the party wishes to terminate or amend this Re-
stated Lease. If such notice is given, the Re -stated Lease shall terminate on
August 31St of the year following the year when the written notice is given."
Section 5: Base Rent
This section of the Lease currently reads:
"In exchange for the termination of the existing lease for the Studio and the donation to
Landlord of the equipment listed in Exhibit B, Tenant shall pay no rent to Landlord for
the use of Premises during the term of this Lease, other than the charges for utilities
and maintenance set forth in Section 6 and 7, respectively."
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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It has been over nine years since PVNET agreed to an early termination of the previous
lease for the Cable Television Studio building and donation of the equipment listed in
Exhibit B of the current lease in exchange for paying no ground rent for the Annex.
During that time, all of the donated equipment has been fully amortized and, in most
cases, has worn out from use and has been replaced. Therefore, consideration should
be given to whether any rent should be required as part of the re -stated Lease.
For context, staff contacted the Palos Verdes Chamber of Commerce and learned that
available commercial space on the Peninsula is currently leasing from $1.85/square foot
per month to $2.25/square foot per month, with a rough average of $2.00/square foot
per month. However, there are other terms of commercial leases which impact the total
cost, such as whether the lease is "modified gross" or "triple net", who pays for tenant
improvements, etc., which are all factors subject to negotiation. In addition, the overall
amenities and quality of the building, availability of parking and other services, etc.,
impacts the leasing rate. Applying the lowest market rate of $1.85/square foot per
month, with a total ground lease space of 2,640 square feet, would result in a rent rate
of $4,884 per month or $58,608 per year.
PVNET is a community-based non-profit organization that provides a variety of
educational and computer training opportunities to the public. In light of the unique
services that PVNET provides to the community, staff recommends not charging a
monthly rent as part of the re -stated Lease Agreement. This is similar to other non-
profit community organizations that have facilities in the City, such as Peninsula
Seniors, Portuguese Bend Nursery School, Palos Verdes Archery Club and Las
Candalistas. Therefore, staff recommends modifying this section of the re -stated Lease
as follows:
"Due to the educational and computer training opportunities provided to the
public by Tenant, which are not otherwise being provided by another
governmental or quasi -governmental agency in the community, Tenant shall pay
no rent to Landlord for the use of Premises during the term of this Re -Stated
Lease, other than the charges for utilities set forth in Section 6."
Section 6: Utilities
This section of the Lease currently reads:
"Landlord shall pay for all utilities used in connection with the Premises, including the
City telephone system and the alarm system. Landlord also shall pay for all utilities that
are not separately metered for the Premises, including water. Other than the two VOIP
telephones, which shall be provided by Landlord, Tenant shall pay for Tenant's
telephone system."
PVNET would like to install a separate meter and add solar panels on the roof of its
expanded facility; and therefore, no longer require electrical service from the City's
Amendment to PVNET Annex Lease Agreement
August 18, 2015
Page 9
meter. As PVNET is no longer providing IT Services to the City, the re -stated Lease
has been modified so that the City no longer provides two VOIP telephones to the
Annex, and that PVNET is responsible for providing its own custodial services within the
building. Because the current security alarm system is integrated with the City's
adjacent Emergency Communications Center, the City will continue to provide this
service to both facilities.
Therefore, staff recommends modifying Section 6 of the Lease as follows:
"Tenant shall pay all costs for electrical and telephone service to Buildings.
Water and a security alarm system shall be provided by Landlord. Any additional
utilities shall be furnished by Tenant at Tenant's sole expense subject to the
approval of Landlord."
Section 7: Maintenance of Premises
The first two paragraphs in this section relate to the Tenant's and Landlord's
responsibilities to maintain the Building and Premises, which currently read:
"Tenant's Obligations. Except as specifically provided in Section 6.2, Tenant shall have
the sole responsibility for maintaining the Building in a good, safe, clean and operation
condition so that it compatible with other structure on Landlord's Property. Tenant shall
reimburse Landlord for any repairs necessitated by Tenant's use of the Premises."
"Landlord's Obligations. Landlord shall have the sole responsibility for maintaining the
roof, structural, electrical, heating venting and plumbing at the Premises in a good, safe,
clean and operating condition, ordinary wear and tear excepted; provided, however, that
Tenant shall reimburse Landlord for the reasonable costs and expenses incurred by
Landlord in connection with any repairs to the Premises occasioned by Tenant's use of
the Premises (i.e. Tenant shall be responsible for repairs to plumbing and electrical
systems to the extent such maintenance or repairs are required due to Tenant's use of
the Premises.) Landlord shall provide reasonable custodial and cleaning services at the
Premises."
In Section 1 of the Lease (Description of Premises), the term "Premises is defines as
"unimproved real property" while the "Building" is defined as the "modular building"
placed on the Premises by the Tenant. Therefore, it is unclear why the Landlord would
be obligated to maintain the "roof, structural, electrical, heating venting and plumbing" of
unimproved real property, even if those costs were reimbursed to the City by PVNET.
Similarly, it's unclear why the City would be required to provide "custodial and cleaning
services" for unimproved real property. As mentioned previously, the re -stated Lease
cleans up a number of overlapping provisions that resulted from the reshuffling of lease
space that took place in 2006 and reflects both party's current circumstances and
needs. Therefore, staff recommends modifying this section of the re -stated Lease as
follows:
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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"7.1 Tenant's Obligations. Tenant shall have the sole responsibility for
maintaining the Buildings in a good, safe, clean and operating condition so that
they are compatible with other structures on Landlord's Property."
"7.2 Landlord's Obligations. Landlord shall maintain utilities on the Property that
serve the Buildings."
No changes are proposed to Section 7.3, except to change the title from "Breach of
Obligations" to "Right of Cause," and to specify that ten (10) business day prior written
notice is required.
Sections 8 through 14: Other Provisions of Lease
The City Attorney's Office has reviewed and revised the re -stated Lease and, due to the
age of the previous agreement, has made a number of minor and clarifying changes to
the other provisions of the agreement to reflect current best practices.
Section 15: Termination of Previous Lease Agreement
Due to the fact there is a pre-existing Lease Agreement for the Annex that will be
replaced by the re -stated Lease, staff recommends modifying this section as follows:
"The existing Lease Agreement between the parties, dated June 20, 2006, is
hereby terminated and replaced by this Amended and Re -stated Lease Agreement
as of September 1, 2015."
ADDITIONAL INFORMATION
The Public Works Department arranged for KOA Corporation to assess the condition of
the office and storage building that is currently occupied by PVNET and will be returned
to the City at the end of the calendar year. KOA's July 29, 2015 report (see attached)
determined that the prefabricated building was likely manufactured in the late 1970's
and, although the building was found to be in poor condition, the structure appears to be
reasonably sound. However, many of the internal doors do not close properly,
indicating the structure has some deficiencies; there is evidence of significant termite
infestations; and although there would not have been any lead -paint used in the building
based on its age, the presence of asbestos is possible. KOA estimated that the total
cost to make their recommended repairs and to upgrade the building to a reasonable
standard would be approximately $140,000 to $175,000. Investing this amount would
bring the building into good condition, but not to a "like new" standard, as there could be
some underlying structural limitations, and would result in the useful life of the building
being extended for another 10-15 years. KOA's overall recommendation is to scrap or
sell the building and not make any repairs.
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Amendment to PVNET Annex Lease Agreement
August 18, 2015
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ALTERNATIVES
Approve the re -stated Lease with different provisions than those recommended
by staff.
2. Do not approve a res -stated Lease, thereby only allowing PVNET to continue to
occupy the Annex is its current configuration.
3. Direct staff to issue a Notice of Termination of Lease to PVNET prior to
September 1, 2015, thereby requiring PVNET to vacant the Annex by
December 31, 2016.
Attachments:
Exhibit A: Draft Amended and Re -stated Lease Agreement between the City and
PVNET and Site Plan (page 12)
Exhibit B: Existing Annex Lease Agreement dated June 20, 2006 (page 22)
Exhibit C: KOA Corporation Report on Prefabricated Trailer Building at Rancho
Palos Verdes City Hall dated July 29, 2015 (page 34)
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EXHIBIT A
DRAFT AMENDED AND RE -STATED LEASE AGREEMENT
BETWEEN THE CITY AND PALOS VERDES ON THE NET
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RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
City of Rancho Palos Verdes
City Clerk's Office
30940 Hawthorne Boulevard
Rancho Palos Verdes, California 90275
-002-908
[Space Above For Recorder's Use Only]
Recording Fee: Exempt pursuant to California
Government Code Section 27383
AMENDED AND RE -STATED LEASE AGREEMENT
THIS AMENDED AND RE -STATED LEASE AGREEMENT ("Re -stated Lease") is
dated as of September 1, 2015, and is entered into by and between the CITY OF RANCHO
PALOS VERDES, a California municipal corporation ("Landlord"), and PALOS VERDES ON
THE NET, a California non-profit corporation ("Tenant").
RECITALS:
A. Landlord is the owner of certain improved real property located at 30940
Hawthorne Boulevard, Rancho Palos Verdes ("Property").
B. Tenant has occupied a building on the Property for use as an office and storage
space ("Office Building") pursuant to a lease that was entered into on October 1, 1996. On
August 19, 2014, the City issued a Notice of Termination of Lease for the Office Building to
Tenant, thereby establishing a December 31, 2015 expiration date for Tenant to relinquish the
Office Building back to the Landlord.
C. On June 20, 2006, Landlord entered into a lease with Tenant to place Tenant's
existing portable building on the Landlord's property within the maintenance yard of the
Property for Tenant's use as a Multimedia and Technology Center.
D. Tenant now wishes to place a second portable building on Landlord's Property
immediately abutting the Multimedia and Technology Center, which is depicted in Exhibit "A"
attached hereto and made a part hereof.
E. Landlord agrees to lease an additional unimproved portion of the Property that is
adjacent to the Multimedia and Technology Center to Tenant, and Tenant desires to lease such
improved real property from Landlord, upon the terms and conditions set forth herein.
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AGREEMENT:
NOW, THEREFORE, Landlord and Tenant agree as follows:
1. DESCRIPTION OF PREMISES. Landlord hereby leases to Tenant, and Tenant
hereby leases from Landlord, without representation or warranty, express or implied, the portion
of Landlord's property that is adjacent to the maintenance yard at the Rancho Palos Verdes Civic
Center, located at 30940 Hawthorne Boulevard, Rancho Palos Verdes, California, which is
indicated in the cross -hatched area on Exhibit A attached hereto (the "Premises") so that Tenant
can place its two modular buildings (the "Buildings") thereon.
Landlord may determine, in its sole and reasonable discretion, that construction of other
structures or facilities on the Property or another condition on or adjacent to the Premises
requires the Buildings to be moved to another equivalent area on the Property. In that event,
Landlord shall provide at least six (6) months prior written notice to Tenant to move the
Buildings. All costs associated with the relocation of the Buildings shall be paid for by Tenant.
Notwithstanding the foregoing, Tenant shall have the option of terminating the Re -stated Lease
by providing Landlord with written notice of its election to do so within sixty (60) calendar days
of receiving Landlord's written relocation notice and shall vacate the Property within six (6)
months of the date of its election to terminate the Re -stated Lease.
2. USE OF PREMISES. Tenant shall have the right to maintain its existing
modular building on the Premises and to expand it to add a second modular building as shown in
Exhibit A for use in connection with its operation of a Multimedia and Technology Center,
which is operated under the name Palos Verdes on the Net. The second modular building shall
not be used for additional classroom or training space, and shall only be used for office and
storage space. Tenant shall not use the Premises for any purpose that is unrelated to the
Multimedia and Technology Center.
However, (i) Tenant shall not use the Premises, or permit anything to be done in or about
the Premises, that will in any way conflicts with, or otherwise violates, any law, statute,
ordinance or other governmental rule or regulation applicable to the Premises and the Buildings
and/or the uses thereof. Tenant shall comply, and shall cause the Premises and the uses thereof
to comply, with all laws, statutes, ordinances and other governmental or quasi -governmental
rules and regulations applicable thereto; and, (ii) Tenant agrees that the Premises shall not be
used for the production of multimedia programs/projects with content that is illegal or may be
inconsistent with Tenant's program of providing instruction to minors (e.g., pornography,
obscene language, violence or illicit drug use) or which is otherwise offensive to or inappropriate
for said prospective users of the services/facilities at the Premises; and, (iii) Under no
circumstances shall any hazardous, toxic and/or contaminating substances be brought or kept on
the Premises except for cleaning products typically used in connection with the equipment that is
located in the Premises.
3. ACCESS TO PREMISES. Landlord hereby grants Tenant access to the
Premises to operate its facilities and provide its services as much as twenty-four (24) hours per
day, seven (7) days a week (subject to disruptions of access that are beyond Landlord's control).
Landlord reserves the right to enter Tenant's Buildings upon reasonable notice during Tenant's
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regular business hours. Landlord may enter the Premises and the Buildings at other times and
without notice in the event of an emergency.
4. TERM OF RE -STATED LEASE. The term of this Re -stated Lease shall be for a
period of four (4) years and four (4) months commencing on September 1, 2015, and terminating
on December 31, 2019. On or before September lst of each year, either party has the right to
notify the other party in writing that the party wishes to terminate or amend this Re -stated Lease.
If such notice is given, the Re -stated Lease shall terminate on August 31 st of the year following
the year when the written notice is given.
5. BASE RENT. Due to the educational and computer training opportunities
provided to the public by Tenant, which are not otherwise being provided by another
governmental or quasi -governmental agency in the community, Tenant shall pay no rent to
Landlord for the use of Premises during the term of this Re -stated Lease, other than the charges
for utilities set forth in Sections 6.
6. UTILITIES. Tenant shall pay all costs for electrical and telephone service to
Buildings. Water and a security alarm system shall be provided by Landlord. Any additional
utilities shall be furnished by Tenant at Tenant's sole expense subject to the approval of
Landlord.
7. MAINTENANCE OF PREMISES.
7.1 Tenant's Obligations. Tenant shall have the sole responsibility for
maintaining the Buildings in a good, safe, clean and operating condition so that they are
compatible with other structures on Landlord's Property.
7.2 Landlord's Obligations. Landlord shall maintain utilities on the Property
that serve the Buildings.
7.3 Right of Cure. In the event either party breaches its obligations to repair
and/or maintain the Premises as specified in this Section 7, after ten (10) business days written
notice thereof from the non -breaching party to the breaching party, the non -breaching party may,
but shall not be obligated to, make or cause such repair or maintenance to be made, and the
breaching party shall promptly reimburse the non -breaching party for all sums expended
therefor.
8. ALTERATIONS TO PREMISES. Other than installing the Buildings on the
Premises, no structural changes, alterations, repairs, additions, remodeling or improvements shall
be made to the Premises by Tenant without the prior written consent of Landlord; provided,
however, that Tenant may make modifications to the interior of the Buildings without Landlord's
permission. Except as specified herein, Landlord shall have no obligation to make structural
changes, alterations, repairs, additions, remodeling or improvements to the Premises. Tenant
shall keep the Premises free of any mechanics' liens arising from work performed to the
Premises by or at the request of Tenant, and in the event of the foregoing, Tenant shall
immediately pay any amounts owing and obtain a release of any such lien.
1863150vl 3
15
9. POSSESSORY INTEREST TAXES. This Re -stated Lease may create a
possessory interest subject to property taxes and assessments. In such event, Tenant shall pay
and discharge, prior to delinquency, all such taxes and assessments, whether the same are
assessed to Landlord or Tenant. Any such taxes or assessment paid by Tenant to Landlord under
the provisions hereof will be remitted by Landlord to the appropriate taxing agency in a timely
manner, and the payment of such taxes or assessments by Tenant to Landlord shall fully
discharge Tenant from its obligation to pay the same. In the event that Landlord shall pay any
such taxes or assessments, Tenant shall be obligated to reimburse Landlord therefor.
10. INDEMNIFICATION. To the fullest extent permitted by law, and in addition to
Tenant's other obligations hereunder, at law, in equity or otherwise, Tenant agrees to protect,
indemnify, defend and hold Landlord and its officers, directors, employees, representatives,
agents and affiliates free and harmless from and against any liability, loss, claim, cost or expense
(including reasonable attorney's fees and expenses in connection therewith), that Landlord may
sustain or incur in connection with (a) Tenant's use of the Premises, (b) Tenant's breach or
default in the performance of any of its obligations hereunder or (c) any act, neglect, fault or
omission of Tenant or its agents, employees, visitors, invitees or licensees, except if the sole
cause of such indemnification or defense obligation is the negligence, gross negligence or willful
misconduct of Landlord.
11. ASSIGNMENT AND SUBLETTING. Tenant shall not voluntarily, or by
operation of law, assign, sublet or otherwise transfer or encumber all or any part of Tenant's
interest in this Re -stated Lease or the Premises without the prior consent of Landlord in its sole
and absolute discretion, and any attempt to do so shall be null and void ab initio. No assignment
or subletting (or Landlord consent thereto) shall relieve Tenant of its obligations hereunder. The
acceptance of payments by Landlord from any other person or entity shall not be deemed to be a
waiver by Landlord of any provision of this Re -stated Lease or to be a consent of any
assignment, subletting or other transfer and shall not be deemed to constitute a consent to any
subsequent assignment, subletting or other transfer.
12. DEFAULTS AND REMEDIES.
12.1 Defaults. Any of the following events shall constitute an "Event of
Default" under this Re -stated Lease by Tenant:
12. 1.1 Monetary Default. A breach of this Agreement by Tenant
involving the payment of money, and the continuance of such breach for a period of ten (10)
days after written notice from Landlord; or,
12.1.2 Non -Monetary Default. A breach of any other term of this
Agreement by Tenant not involving the payment of money, and the continuance of such breach
for a period of thirty (30) days after written notice from Landlord; provided, however, that if
such breach is not reasonably susceptible of being cured within such thirty (30) day period, then
a default shall exists only if Tenant does not commence to cure such breach within such thirty
(30) day period or thereafter fails to diligently prosecute such cure to completion.
1863150vl 4
16
12.2 Termination of Lease and Remedies. Upon occurrence of an "Event of
Default" by Tenant, Landlord may by written notice to Tenant terminate this Re -stated Lease and
Tenant shall immediately surrender possession of the Premises to Landlord. In such event,
Landlord shall be entitled to recover from Tenant any amount necessary to compensate Landlord
for all detriment proximately caused by Tenant's failure to perform its obligations hereunder or
which, in the ordinary course of events, would be likely to result therefrom.
13. DAMAGE AND DESTRUCTION. In the event the Premises or either of the
Buildings are damaged or destroyed, Landlord shall have the option of either repairing or
replacing the Premises, and Tenant shall have the option of repairing or replacing the applicable
Building(s), and both parties shall have the option to terminate this Re -stated Lease as of the date
of such destruction or damage.
14. MISCELLANEOUS.
14.1 Notices: Any notice, request, direction, demand, consent, waiver,
approval or other communication required or permitted to be given hereunder shall not be
effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail,
postage prepaid, return receipt requested, or (c) by a commercial overnight courier that
guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses
stated below, or at such other address as either party may hereafter notify the other in writing as
aforementioned:
Landlord: City of Rancho Palos Verdes
30940 Hawthorne Boulevard
Rancho Palos Verdes, California 90275
Attention: City Manager
Tenant: Palos Verdes on the Net
30940 Hawthorne Boulevard, Suite 101
Rancho Palos Verdes, California 90275
Attention: Ted Vegvari
14.2 Non -Waiver. The failure of Landlord to insist upon strict performance of
any of the terms, conditions or covenants of this Re -stated Lease shall not be
deemed a waiver of any right or remedy Landlord may have and shall not be
deemed a waiver of any right or remedy for subsequent breach or default of the
terms, conditions, or covenants herein contained.
14.3 Resolution of Problems. As identified in Section 14. 1, Landlord's
representative (City Manager) or his/her designee shall report any problems or
complaints in writing to Tenant's representative (Ted Vegvari) or his successor.
Tenant shall be responsible for seeking a solution to any major or frequently
reported problem or complaints. In the event such problems or complaints are not
1863150v1 5
17
resolved, Landlord's representative shall meet with Tenant's representative to
review the situation and propose an appropriate solution.
14.4 End of Term. Upon expiration or any earlier termination of this Re -stated
Lease, Tenant shall remove the Buildings and return the Premises to Landlord in a
similar condition as received, ordinary wear and tear excepted.
14.5 Holding Over. Should Tenant, with or without Landlord's consent, hold
over after the termination of this Re -stated Lease, such possession by Tenant shall
be deemed to be a month-to-month tenancy terminable by thirty (30) days written
notice given at any time, upon each and all of the terms herein provided as may be
applicable to a month-to-month tenancy.
14.6 Attorney's Fees. In the event of any litigation between Tenant and
Landlord to enforce any provision of this Re -stated Lease or any right of either
party hereto, or to secure a judicial determination of any right or obligation of
either party hereto, the unsuccessful party in such litigation shall pay to the
successful party reasonable costs and expenses, including reasonable attorney's
fees, incurred therein.
14.7 Headings. The section captions contained in this Lease are for
convenience and do not in any way limit or amplify any term or provision of this
Lease and shall have no effect on its interpretation.
14.7 Entire Agreement. This Re -stated Lease and the Exhibit A attached hereto
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof, and no prior agreement or understanding pertaining to any
such matter shall be effective for any purpose. No provision of this Re -stated
Lease may be amended or supplemented except by an agreement in writing signed
by the parties hereto.
14.8 Quiet Possession. Upon complying with all the terms and conditions
hereof, and subject to all of the provisions hereof, Tenant shall have quiet
possession of the Premises.
14.9 Governing Law. This Re -stated Lease is made and entered into in the
State of California and shall in all respects be interpreted, enforced and governed
under the substantive laws of the State of California without regard for
California's choice of law rules. Venue for any action regarding this agreement
shall be in Los Angeles County.
14.10 Severability. If any term or provision of this Re -stated Lease shall be
deemed to be invalid or unenforceable to any extent, the remainder of this Re-
stated Lease will not be affected thereby, and each remaining term and provision
of this Re -stated Lease will be valid and be enforced to the fullest extent
permitted by law.
18631500 6 18
14.11 No Joint Venture. It is not the intent of the parties to create a joint venture
or partnership by entering into this Re -stated Lease.
14.12 Interpretation. Whenever the context may require, any pronouns used
herein shall include the corresponding masculine, feminine or neuter forms, and
the singular form of nouns and pronouns shall include the plural and vice versa.
References to "Sections" and "Exhibits" are to sections and exhibits of this Re-
stated Lease, unless otherwise specifically provided.
14.13 Counterparts. This Re -stated Lease may be executed in one or more
counterparts, each of which shall be deemed to constitute an original, but all of
which, when taken together, shall constitute one and the same instrument, with the
same effect as if all of the parties had executed the same counterpart.
14.14 No Discrimination. There shall be no discrimination against or
segregation of any person or group of persons on account of race, color, creed,
religion, national origin, ancestry, physical handicap, mental condition, marital
status, sex or sexual orientation with respect to the Premises, nor shall Tenant
establish or permit any such practice or practices of discrimination or segregation
with reference to the use of the Premises.
14.15 Time of Essence. Time is of the essence in every provision herein in which
time is a factor.
15. TERMINATION OF PREVIOUS LEASE AGREEMENT. The existing Lease
Agreement between the parties, dated June 20, 2006, is hereby terminated and replaced by this
Amended and Re -Stated Lease Agreement as of September 1, 2015.
IN WITNESS WHEREOF, the parties hereto have executed this Amended and Re -stated
Lease Agreement as of the date first written above.
TENANT:
PALOS VERDES ON THE NET, a California non-
profit corporation
By:
Name:
Title:
By:
Name:
Title:
1863150v1 7
19
LANDLORD:
ATTEST:
City Clerk
CITY OF RANCHO PALOS VERDES, a
California municipal corporation
By:
Name:
Title:
1863150v1 g
20
Exhibit `A'
Multimedia & Technology Center
Site Plan
Scale: 1" = 25'
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1.
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Exi
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Existing ADA Ramp
17'x 28'
21
EXISTING ANNEX LEASE AGREEMENT
DATED JUNE 20, 2006
22
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
City of Rancho Palos Verdes
Planning Department
30940 Hawthorne Boulevard
Rancho Palos Verdes, California 90274
[Space Above For Recorder's Use Only]
Recording Fee: Exempt pursuant to California
Government Code Section 27383
LEASE AGREEMENT
THIS LEASE AGREEMENT (this "Lease") dated as of June 20, 2006, is entered into by
and between the CITY OF RANCHO PALOS VERDES, a California municipal corporation
("Landlord"), and PALOS VERDES ON THE NET, a California non-profit corporation
("Tenant").
RECITALS:
A. Landlord is the owner of certain improved real property located at 30940
Hawthorne Boulevard, Rancho Palos Verdes ("the Property"),
B. Tenant has been leasing a building on the Property for use as a cable television
studio with full digital/video multimedia production capabilities ("Studio"), pursuant to a lease
that was entered into on May 6, 2003.
C. At the November 15, 2005 City Council meeting, Landlord granted permission to
Tenant to place Tenant's portable building on the Landlord's property adjacent to the Studio for
Tenant's use as a Multimedia and Information Technology Center.
D. Landlord now wishes to rent the Studio to others and use the Studio, including
equipment that belongs to Tenant, which is described in Exhibit "B" hereto, and wishes to
terminate Tenant's existing of the Studio.
E. Landlord desires to lease an unimproved portion of the Property that is adjacent to
the Studio to Tenant, and Tenant desires to lease such improved real property from Landlord,
upon the terms and conditions set forth herein.
AGREEMENT:
NOW, THEREFORE, Landlord and Tenant agree as follows:
23
1. DESCRIPTION OF PREMISES. Landlord hereby leases to Tenant, and Tenant
hereby leases from Landlord, the unimproved portion of Landlord's property that is adjacent to
the Studio at the Rancho Palos Verdes Civic Center, located at 30940 Hawthorne Boulevard,
Rancho Palos Verdes, California, which unimproved real property is indicated in the cross -hatch
on Exhibit A attached hereto (the "Premises") so that Tenant can place its modular building
("Building") thereon. The Premises have been, or will be, prepared by Landlord, at its sole cost
and expense, for said use, including the installation of two (1) VOIP phones that will be
connected to Landlord's VOIP phone system and utilities to serve the Building,
Landlord may determine, in its sole and reasonable discretion, that construction of other
strictures or facilities on the Property or another condition on or adjacent to the Premises
requires the Building to be moved to another equivalent area on the Property. In that event,
Landlord shall provide at least nine months prior written notice to Tenant of the relocation, and
shall pay all costs associated with the relocation of the Building.
2. USE OF PREMISES. Tenant shall have the right to place its Building on the
Premises for use in connection with its operation of a Multimedia and Information Technology
Center in connection with its existing community telecommunication center, which is operated
under the name Palos Verdes on the Net. Tenant shall not use the Premises for any purpose that
is unrelated to this purpose.
In addition, Tenant shall not use the Premises, or permit anything to be done in or about
the Premises, that will in any way conflicts with, or otherwise violates, any law, statute,
ordinance or other governmental rule or regulation applicable to the Premises and/or the uses
thereof. Tenant shall comply, and shall cause the Premises and the uses thereof to comply, with
all laws, statutes, ordinances and other governmental or quasi -governmental rules and
regulations applicable thereto. Notwithstanding the foregoing, Tenant agrees that the Premises
shall not be used for the production of multimedia programs/projects with content that may be
inconsistent with Tenant's program of providing instruction to minors (e.g., pornography,
obscene language, violence or illicit drug use) or which is otherwise offensive to or inappropriate
for said prospective users of the services/facilities at the Premises. Finally, under no
circumstances shall any hazardous, toxic and/or contaminating substances be brought or kept on
the Premises except for cleaning products typically used in connection with the equipment that is
located in the Premises.
3. ACCESS TO PREMISES. Landlord hereby grants Tenant access to the Premises
to operate its facilities and provide its services as much as twenty-four (24) hours per day, seven
days a week; provided, however, that Landlord reserves the right to enter Tenant's Building upon
reasonable notice during Tenant's posted business hours. Landlord may enter the Premises and
the Building at other times and without notice in the event of an emergency. In addition, Tenant
shall provide access to the Premises and the Building on a regular basis for the performance of
Landlord's maintenance and repair obligations specified in Section 7.2.
4. TERM OF LEASE. The term of this Lease shall be for a period of three years,
effective as of the date and year first written above. This Lease shall automatically renew from
year to year thereafter, unless on or before September 1St of each year, either party notifies the
other party in writing that the party wishes to terminate or amend this Lease. If such notice is
897640.2 2
24
given, the lease shall be terminated on December 31st of the year following the year when the
written notice is given.
5. BASE RENT, In exchange for the termination of the existing lease for the Studio
and the donation to Landlord of the equipment listed in Exhibit "B," Tenant shall pay no rent to
Landlord for the use of Premises during the term of this Lease, other than the charges for utilities
and maintenance set forth in Sections 6 and 7, respectively.
5 UTILITIES. Landlord shall pay for all utilities used in connection with the
Premises, including the City telephone system and the alarm system. Landlord also shall pay for
all utilities that are not separately metered for the Premises, including water. Other than the two
VOID telephones, which shall be provided by Landlord, Tenant shall pay for Tenant's telephone
system.
6 MAINTENANCE OF PREMISES.
6.1 Tenant's Obligations. Except as specifically provided in Section 6.2,
Tenant shall have the sole responsibility for maintaining the Building in a good, safe, clean and
operating condition so that it is compatible with other structures on Landlord's Property. Tenant
shall reimburse Landlord for any repairs necessitated by Tenant's use of the Premises.
6.2 Landlord's Obligations. Landlord shall have the sole responsibility for
maintaining the roof, structural, electrical, heating, venting and plumbing at the Premises in a
good, safe, clean and operating condition, ordinary wear and tear excepted; provided, however,
that Tenant shall reimburse Landlord for the reasonable costs and expenses incurred by Landlord
in connection with any repairs to the Premises occasioned by Tenant's use of the Premises (i.e.,
Tenant shall be responsible for repairs to plumbing and electrical systems to the extent such
maintenance or repairs are required due to Tenant's use of the Premises.) Landlord shall provide
reasonable custodial and cleaning services at the Premises.
6.3 Breach of Obligations. In the event either party breaches its obligations to
repair and/or maintain the Premises as specified in this Section 7, after reasonable notice thereof
from the non -breaching party to the breaching party, the non -breaching party may, but shall not
be obligated to, make or cause such repair or maintenance to be made, and the breaching party
shall promptly reimburse the non -breaching party for all sums expended therefor.
7 ALTERATIONS TO PREMISES. Other than installing the Building on the
Premises, no structural changes, alterations, repairs, additions, remodeling or improvements shall
be made to the Premises by Tenant without the prior consent of Landlord; provided; however,
that Tenant may make modifications to the interior of the Building without Landlord's
permission. Except as otherwise provided herein, Landlord shall have no obligation to make
structural changes, alterations, repairs, additions, remodeling or improvements to the Premises or
the Building, including decorating or painting. Tenant shall use its best efforts to keep the
Premises free of any mechanics' liens arising from work performed to the Premises by Tenant,
and in the event of the foregoing, Tenant shall immediately pay any amounts owing and obtain a
release of any such lien.
897640.2 3
25
8 TAXES. This Lease may create a possessory interest subject to property taxes
and assessments. In such event, Tenant shall pay and discharge, prior to delinquency, all such
taxes and assessments, whether the same are assessed to Landlord or Tenant. Any such taxes or
assessment paid by Tenant to Landlord under the provisions hereof will be remitted by Landlord
to the appropriate taxing agency in a timely manner, and the payment of such taxes or
assessments by Tenant to Landlord shall fully discharge Tenant from its obligation to pay the
same. In the event that Landlord shall pay any such taxes or assessments, Tenant shall be
obligated to reimburse Landlord therefor.
9 HOLD HARMLESS. To the fullest extent permitted by law, and in addition to
Tenant's other obligations hereunder, at law, in equity or otherwise, Tenant agrees to protect,
indemnify, defend and hold Landlord and its officers, directors, employees, representatives,
agents and affiliates free and harmless from and against any action, suit, claim, investigation,
proceeding, mediation or arbitration at law or in equity or before or by any foreign or domestic
court, arbitrator, mediator or otherwise (including reasonable attorney's fees and expenses in
connection therewith), and pay or reimburse Landlord in full, any and all liability, loss, cost,
expense or damage of any kind or nature that Landlord may sustain or incur or that may be
brought or claimed against Landlord in connection with (a) Tenant's use of the Premises,
(b) Tenant's breach or default in the performance of any of its obligations hereunder or (c) any
act, neglect, fault or omission of Tenant or its agents, employees, visitors, invitees or licensees.
Notwithstanding the foregoing, it is the intent of Landlord and Tenant that Tenant shall be liable
to protect, indemnify, defend and hold Landlord harmless under this Section 10 irrespective of
the cause of such indemnification liability (i.e., regardless of whether or not caused by any act,
omission, willful misconduct or negligent conduct (whether active or passive) of Tenant, or
otherwise), except if the sole cause of such indemnification liability is the negligence, gross
negligence or willful misconduct of Landlord.
10 ASSIGNMENT AND SUBLETTING. Tenant shall not voluntarily, or by
operation of law, assign, sublet or otherwise transfer or encumber all or any part of Tenant's
interest in this Lease or the Premises without the prior consent of Landlord, and any attempt to
do so shall be null and void ab initio. No assignment or subletting shall relieve Tenant of its
obligations hereunder. The acceptance of payments by Landlord from any other person or entity
shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent
of any assignment, subletting or other transfer and shall not be deemed to constitute a consent to
any subsequent assignment, subletting or other transfer.
I 1 DEFAULTS AND REMEDIES.
11.1 Defaults. Any of the following events shall constitute a default under this
Lease by Tenant;
11.1.1 Monetary Default. A breach of this Agreement by Tenant
involving the payment of money, and the continuance of such breach for a period of ten (10)
days after Tenant's receipt of notice thereof, or
11. 1.2 Non -Monetary Default. A breach of any material term of this
Agreement by Tenant not involving the payment of money, and the continuance of such breach
897640.2 4
26
for a period of thirty (30) days after Tenant's receipt of notice thereof; provided, however, that if
such breach is not reasonably susceptible of being cured within such thirty (30) day period, then
a default shall exists only if Tenant does not commence to cure such breach within such thirty
(30) day period or thereafter fails to diligently prosecute such cure to completion.
11.2 Termination of Lease and Remedies. In the event of a default by Tenant,
Landlord may, at any time prior to a cure thereof by Tenant, upon notice and demand, and
without limiting Landlord in the exercise of any other right or remedy that Landlord may have by
reason of such default, terminate Tenant's right to possession of the Premises by any lawful
means, in which case this Lease shall terminate and Tenant shall immediately surrender
possession of the Premises to Landlord. In such event, Landlord shall also be entitled to recover
from Tenant Any amount necessary to compensate Landlord for all detriment proximately
caused by Tenant's failure to perform its obligations hereunder or which, in the ordinary course
of events, would be likely to result therefrom.
11.3 Non -waiver. Nothing contained in this Section 12 shall constitute a
waiver of Landlord's right to recover damages by reason of Landlord's efforts to mitigate its
damages caused by Tenant's default; nor shall anything in this Section 12 adversely affect
Landlord's right, as provided in this Lease, to indemnification against liability for damage to
persons or property occurring prior to the termination of this Lease.
12 DAMAGE AND DESTRUCTION. In the event the Premises or the Building are
damaged or destroyed, either party shall have the option of either repairing the Premises or the
Building or terminating this Lease as of the date of such destruction or damage.
13 MISCELLANEOUS.
13.1 Notices: Any notice, request, direction, demand, consent, waiver,
approval or other communication required or permitted to be given hereunder shall not be
effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail,
postage prepaid, return receipt requested, or (c) by a commercial overnight courier that
guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses
stated below, or at such other address as either party may hereafter notify the other in writing as
aforementioned:
Landlord: City of Rancho Palos Verdes
30940 Hawthorne Boulevard
Rancho Palos Verdes, California 90275
Attention: City Manager
Tenant: Palos Verdes on the Net
30940 Hawthorne Boulevard
Rancho Palos Verdes, California 90275
Attention: Ted Vegvari
897640.2 5
27
13.2 Non -Waiver. The failure of Landlord to insist upon strict performance of
any of the terms, conditions or covenants of this Lease shall not be deemed a waiver of any right
or remedy Landlord may have and shall not be deemed a waiver of any right or remedy for
subsequent breach or default of the terms, conditions, or covenants herein contained.
13.3 Resolution of Problems. The Senior Administrative Analyst in the City
Manager's Office of Landlord shall report any problems or complaints to the Director of Tenant.
The Director of Tenant shall be responsible for seeking a solution to any major or frequently
reported problem or complaints. In the event such problems or complaints are not resolved, the
Senior Administrative Analyst and/or City Manager of Landlord shall meet with the Director of
Tenant to review the situation and propose an appropriate solution.
13.4 End of Term. At the end of the term, Tenant shall remove the Building
and return the Premises to Landlord in a similar condition as received, ordinary wear and tear
excepted.
13.5 Holding Over. Should Tenant, with or without Landlord's consent, hold
over after the termination of this Lease, such possession by Tenant shall be deemed to be a
month-to-month tenancy terminable by thirty (30) days notice given at any time, upon each and
all of the terms herein provided as may be applicable to a month-to-month tenancy, and any such
holding over shall not constitute an extension of this Lease.
13.6 Attorney's Fees. In the event of any litigation between Tenant and
Landlord to enforce any provision of this Lease or any right of either party hereto, or to secure a
judicial determination of any right or obligation of either party hereto, the unsuccessful party in
such litigation shall pay to the successful party reasonable costs and expenses, including
reasonable attorney's fees, incurred therein.
13.7 Headings. The section captions contained in this Lease are for
convenience and do not in any way limit or amplify any term or provision of this Lease and shall
have no effect on its interpretation.
13.8 Entire Agreement. This Lease and the exhibit attached hereto constitute
the entire agreement between the parties hereto with respect to the subject matter hereof, and no
prior agreement or understanding pertaining to any such matter shall be effective for any
purpose.. No provision of this Lease may be amended or supplemented except by an agreement
in writing signed by the parties hereto,
13.9 Quiet Possession. Upon complying with all the terms and conditions
hereof, and subject to all of the provisions hereof, Tenant shall have quiet possession of the
Premises.
13.10 Governing Law. This Lease is made and entered into in the State of
California and shall in all respects be interpreted, enforced and governed under the substantive
laws of the State of California.
13.11 Severability. If any term or provision of this Lease shall be deemed to be
invalid or unenforceable to any extent, the remainder of this Lease will not be affected thereby,
897640.2 6
28
and each remaining term and provision of this Lease will be valid and be enforced to the fullest
extent permitted by law,
13.12 No Joint Venture. It is not the intent of the parties to create a joint venture
or partnership by entering into this Lease.
13.13 Interpretation. Whenever the context may require, any pronouns used
herein shall include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural and vice versa. References to "Sections"
and "Exhibits" are to sections and exhibits of this Lease, unless otherwise specifically provided.
13,14 Counterparts, This Lease may be executed in one or more counterparts,
each of which shall be deemed to constitute an original, but all of which, when taken together, shall
constitute one and the same instrument, with the same effect as if all of the parties had executed the
same counterpart.
13.15 No Discrimination, There shall be no discrimination against or
segregation of any person or group of persons on account of race, color, creed, religion, national
origin, ancestry, physical handicap, mental condition, marital status, sex or sexual orientation
with respect to the Premises, nor shall Tenant establish or permit any such practice or practices
of discrimination or segregation with reference to the use of the Premises.
14. The existing Lease Agreement between the parties, dated May 6, 2003, whereby
Tenant had been leasing the Studio from Landlord, is hereby terminated as of September 4, 2006,
IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement as of
the date first written above.
TENANT: PALOS VERDES ON THE NET, a California non-
profit corporation
By:
Name: °`} - eC Z e -z
Title:
Name:
Title:
[signatures continue]
897640.2 7
29
LANDLORD:
ATTEST:
FEW
CITY OF RANCHO PALOS VERDES, a
California municipal corporation
Bc%
Name: Ste Wolowic� z
Title: May
897640.2 8
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EXHIBIT B
Cable Studio - Gift Inventory List
(2) Canon XL1 S
(2) Canon SP1 00 shoulder kits
(2) Canon Pro XLR balanced audio units
(2) Varizoom controllers
(2) camera attached LCD monitors paks for Canon Cameras
(2) portable kits for camera attached LCD monitors for Canon Cameras
(1) Sony VX1000 with accessories and hard case
(1) Kenco Pro wide angle lens, and wide conversion lens for Sony Camera
(2) Teleprompter system with Software, Manual, LCD monitor, Computer, Windows XP,
keyboard and mouse
(3) Libec pro Studio Tripods with wheels and heads
(5) Videssence Studio Lights with Clamps and cabling
(5) Station Production Intercom headsets with master unit, power supply, and cables
(2) Shure wireless lapel microphones with transmitters, receivers, cables
(1) MonoPod
(1) DataVideo 4 Channel digital video switcher/mixer
(1) Alesys Pro 16 channel audio mixer
(1)Sony DVCAM DSR11 digital deck
(1) pair speakers in control room
(1) JVC Studio video monitor
(1) Toshiba 15 inch Television
896795.2 1
32
(1) Sylvania VHS recorder
(1) KLH multiformat DVD/CD deck
(1) Sony Betacam deck
(1) Sony Beta HiFi deck
(1) Panasonic SVHS deck
(1) Portable green screen with stand
(1) table and shelf unit in control room
(1) Custom built work space/tables in front office
(1) Studio set
(2) trees (props)
(2) 3 panel room dividers
Overhead rails for hanging lighting
Cabling and connectors for equipment, microphones, decks, monitors, mixers, misc
improvements including exterior building connection for live broadcasting
896795.2 1 1
33
EXHIBIT C
KOA CORPORATION REPORT ON
..li a - : ' p
AT RANCHO PALOS VERDES CITY HALL
DATED JULY 29, 2015
34
R/ KOA CORPORATION
l PLANNING & FNG NEt:RI JCI
July 29, 2015
Report on the Prefabricated Trailer Building at Rancho Palos Verdes City Hall
Building Description
The "Trailer" building located on the east side and adjacent to Building and Safety at Rancho Palos
Verdes city hall, currently being used by PV on the Net is the subject of this report. The building is made
of 4 separate prefabricated trailers, parked next to one another and joined together at the floor, walls
and roof. In general, the building appears to be moderately structurally sound, but in general is in a poor
to condition, which requires would require extensive exterior repairs.
Assessment Methods
KOA Corporation performed a visual assessment of the building. The visual inspection included the roof,
the walls, doors, windows, access areas, and building frame sub structure. Access to the interior of the
building was inspected at a later date and the observations are included in this report.
Roof
The roof was constructed using an asphalt waterproof membrane, with an aggregate surface finish, after
the 4 separate trailers are joined together using connection strips that run the length of the trailers. The
roof support appears to be structurally sound. The trims to the roof are all in reasonable condition and
there is no evidence of leaking through the membrane, however there was fairly extensive rain damage
internally due to poor drainage around openings.
Areas of the aggregate are missing and although the membrane is in moderate condition, it needs
repair to prevent further deterioration and lead to leaking. The installation of a new 2,800 square foot
asphalt membrane applied over the existing, with an aggregate layer on top would extend the life of the
existing roof by 10 to 15 -years. In addition, the roof has sagging on the west and east ends of the
building which should be eliminated using a built -up -roof section at those locations, to avoid further
deterioration.
Recommendations:
Eliminate the ponding areas and add a new waterproofing membrane to the existing roof:
Estimated cost for the total roof repair: $14,000.
35
KOA CORPORATION
Exterior Walls
The walls have been constructed using wood studs, but with no insulation between the internal sheeting
and external siding. The siding is made up of vertical tongue and groove planks that appear to be of
wood fiber composite material. The area of the walls are approximately 2,200 square feet and has a 3 -
foot high skirt below the building floor to enclose the underside of the trailers, which is made of the
same material.
The wall siding is in poor condition in large areas and in moderate condition for the balance. As the
tongue and groove siding is interlocked, replacing individual pieces is not very practical and instead large
areas should be replaced. Visual inspection of the walls revealed soft and rotted areas in the siding and
many holes and cracks were found in various places on all four sides of the building.
Recommendation:
Replace and paint the entire exterior siding.
Install Insulation in all external walls
Estimated cost:
Windows from the Exterior:
$19,000
All windows are single panel windows; however appear to be in reasonable shape, however they leak.
The screens are in poor shape and should be replaced. There are no roof gutters, so rain water sheet -
flows over the edge of the roof and down the walls past the windows, which has led to the deterioration
of the surround in trim to the windows and probably leaks. No waterproofing is present above the
windows to deflect the flows and should be installed.
Recommendation:
Install flashing and waterproofing around windows and replace all window trims. In addition, replace all
screens.
Estimated cost:
$3,000
The framing around the widows is infested with termites and the widows need to be replaced to bring
the building up to present day standards: Replace all windows and framing
Estimated cost: $11,000
36
KOA CORPORATION
Frame/Chassis
As the building is made up of 4 trailers placed and joined together, there are 4 separate steel chassis,
each attached to an axil, with wheels/tires, but supported by a series of steel supports.
The chassis substructure appears to be in good condition, with no sign of rusting. There is no
foundation, with the steel supports supported on the ground. The supports show signs of superficial
rust, but appear to be structurally sound.
Recommendation:
Leave in its current condition.
Exterior Access
Access ways and walkways are generally in good condition; however access to the main entrance of the
building from the west is not ADA compliant and requires replacement. The access to the western side -
door via steps is in reasonably good condition, however requires some maintenance.
Recommendation:
Replace the ramp and handrail with a 50 foot long ramp to decrease the slope angle.
Estimated cost:
Ancillary Items
$7,000.
Observation of the visible sewer drainage pipes under the structure did not reveal any defects and the
electrical boards appear to be in good shape. Although the three wall -mounted air conditioners appear
to be relatively old, they appear to be working. However a new ground mounted unit has recently been
installed, which points to the inadequacy of the 3 wall -mounted units.
The building is infested with termites and has evidence of rat droppings and should be exterminated
before any repairs are done on the building.
Recommendation:
Termite treat the building by tenting
Estimated cost: $2,000.
37
KOA CORPORATION
PLANNING & ENGINEERING
Interior Walls
The walls have been constructed using a wood -based composite board attached to the wood studs and
as mentioned before, with no insulation between the internal sheeting and external siding. The board is
covered with a variety of different wall covering throughout the building. The internal walls are also
made from a similar material mounted on wood studs, with no insulation. Some of the walls have
damage, but in general are in a moderate condition.
Recommendation:
Patch/replace sections of walls, repair damaged studs and re-cover 50% of the walls
Estimated cost:
Flooring
$7,000
The floor is uneven and soft in places, indicating that significant portions of the joists and plywood will
need to be replaced. The floor was not visible either from the top or the underside of the trailers,
however it is suspected that termites infestation is likely as there is significant evidence in the ceiling
space and around the windows. The western end of the building around the entrance from the adjacent
building has significant soft areas. There has been severe leaking in the area and it is likely that
substantial rotting has occurred.
Most of the floor is covered with vinyl tiles, with carpeting in some areas. In general the floor coverings
are in moderate to poor condition and should be replaced. In any event this will become necessary with
the repair/replacement of the flooring boards and joists..
Recommendation:
Replace defective flooring joists and plywood
Estimated cost: $28,000
Replace floor coverings
Estimated cost: $14,000
Ceiling
The ceiling is of T -bar construction with insulation tiles, which are in poor condition with stains and
damage throughout. The support is in reasonable condition so recommend the replacement of all of the
tiles and the installation of insulation.
MW•
KOA CORPORATION
PIANt=ING & ,F N G INEERING
Recommendation:
Replace ceiling tiles and install insulation
Estimated cost:
Air Conditioning
$11,200
Only one of the three built in central air-conditioning units is in working condition and the third is old
and may need to be replaced soon. The ducting appears to be intact; however the diffuser plates in each
room should be replaced.
Recommendation:
Replace and upgrade the air conditioning units
Estimated cost:
Bathrooms
$23,000
The bathrooms are ADA compliant and are accessible. The plumbing appears to be in good condition,
but one of the toilets and a wash hand basin need to be replaced. The extractor fans are in poor
condition.
Recommendation:
Replace wash- hand basin, toilet and extractors
Summary
$2,200
Although the building is in a poor condition, the structure appears to be reasonably sound. However
many of the internal doors do not close properly, which indicates that the structure has some
deficiencies. There is evidence of termite infestations, but without removing portions of the wall it's not
possible to determine the amount of structural damage.
From the information obtained, it is likely that the prefabricated building was manufactured in the late
1970's, which indicates that although there would not have been any lead -paint used, the presence of
asbestos is possible.
The total cost to make the recommended repairs and upgrade the facility to a reasonable standard will
be $140,000 to $175,000. By spending that amount, the building would be in good condition, but not be
to "like new' standard, as there could be some underlying structural limitations. However it would
result in the useful life of the building for another 10-15 years.
Our recommendation is to scrap or sell the building and not do any repairs.
39
KOA CORPORATION
PLANNING & ENGINEERING
Pictures
Location: West wall
Description: Holes in soft wood
Location: Front of Building
Description: Slope of ramp exceeds ADA requirements
M
KOA CORPORATION
PLANNING & ENGINEERING
Location: Front of building
Description: Damaged screen on window
Location: Under building
Description: Substructure in good condition
Attachments
See building inspection checklist.
Sincerely,
KOA Corporation
Alan Braatvedt
V.P. of South Bay Operations
41
KOA CORPORATION
KANNING� & ENvINEERING
Exterior Building Inspection Checklist For City Hall Trailer
Description
I Poor Moderate Good N/A Comments
Roof
X
Blisters or slits in the membrane X
Ponding of water
X
Drain Pipes are plugged
X
Drip edges are provided
X
Gravel
X
Flashings
X
Gutters
X
Trash
X
Exterior Wall
X
Cracks
X
Mortar
X
Brick
X
Stone
X
Wood
X
Water stains
X
Caused wood to become soft.
Cracked boards
X
Various hairline cracks throughout the building.
Rotted and missing boards
X
Termite damage
X
Paint
X
Fenestration
X
Doors
X
alignment
X
deterioration
X
Hardware
X
Windows
X
Sill
X
Frame
X
Screens
X
Waterproofing
X
Air condition units
X
Assessed for any visual damage.
Substructure
X
Supports
X
Beams
X
Floor
X
Foundation
X
42
KOA CORPORATION
PLANNfNI�-& ENGINE ERINIG
43
Building accessibility
X
Structural good but does not comply with ADA standards.
Pathway and sidewalks
X
Curbs
X
Steps/Stairs
X
Stairs on the west end have a damaged support beam.
Ramps
X
Slope does not comply with ADA standards.
Light fixtures
X
There is a missing light on the west side of the building.
Handrails
X
Does not comply with ADA Standards.
Signs
X
No signs present to Identify the building.
Drainage
X
No drainage was seen during the assessment.
Description
Poor
lModeralGood
I N/A Comments
Fenestration
X
Doors
X
alignment
X
deterioration
X
Hardware
X
Windows
X
Sill
X
Frame
X
Screens
X
Waterproofing
X
Air condition units
X Assessed for any visual damage.
Substructure
X
Supports
X
Beams
X
Floor
X
Foundation
X
Building accessibility
X
Structural good but does not comply with ADA standards.
Pathway and sidewalks
X
Curbs
X
Steps/Stairs
X
Stairs on the west end have a damaged support beam.
Ramps
X
Slope does not comply with ADA standards.
Light fixtures
X
There is a missing light on the west side of the building.
Handrails
X
Does not comply with ADA Standards.
Signs
X
No signs present to Identify the building.
Drainage
X
No drainage was seen during the assessment.
43
�/ `-
KOA CORPORATION
FtANN1 HN`; a ENGINEFR1NG
Interior Building Inspection Checklist For City Hall Trailer
Description
Poor oderat
Good
N/A Comments
Interior Walls
X X
Bulging
X
Insulation
X
None
Internal door fit
X
Paint/wall paper
X X
Window trims
X
Sills
X
Locks
1X1
X
Window opening possible?
Yes
Floors
Soft Spots
X
Level
X
X
Carpet
X
Vinyl
X
Stains
X
Termite damage
X
Rot damage
X
At the side entrance
Bathrooms
Extractors
X
Both Bathrooms
ADA Compliance
X
Hand rail
X
Toilet
X
X
One Bathroom
Wash hand basin
X
X
One Bathroom
Towel rack
X
Mirror
X
Walls
X
Floor
X
X
Plumbing
X
Ceilings
Sagging
X
Broken tiles
X
Stains
X
General
Accessibility
X
Doors don't all close properly
AC units
X
1 of 3 work
Light fixtures
X
Visible Condition
X