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Lease Agreement
FULLERTON COMMUNITY NURSERY SCHOOL
SUBLEASE AGREEMENT
THIS SUBLEASE AGREEMENT is by and between the City of Fullerton, a municipal corporation ("Lessor"/“City”), and Fullerton Community Nursery School., a California nonprofit corporation ("Lessee").
WITNESSETH:
WHEREAS, City has leased the real property located in the Brea Dam Flood Control Basin identified as 2050 Youth Way, Fullerton, Ca lifornia and all structures and appurtenances thereon from the Army Corp of Engineers (the “Property”), w h i c hi sm o r es p e c i f i c a l l y described in Attachment A (“Assessor’s Map 028 -050-36 ”), which is incorporated herein by this reference.
WHEREAS, Lessee first entered into a sublease in 1963 to use and occupy the Property for the purpose of operating an early childhood education center.
WHEREAS, the Parties now desires to enter into this new Sublease to allow Lessee to continue to operate on the Property.
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. TERM AND TERMINATION
1.1 Term. The term of the Sublease Agreement shall be five years commencing on $XJXVW , 2024 (“Commencement Date”) and terminating on -XO\ , 20 (the “Term”),
unless sooner terminated as provided herein. The term of this Agreement may be extended upon written mutual consent of the Parties for additional terms of years each.
1.2 Termination
SECTION 2. CONSIDERATION
2.1 Rent. The rent of said Property shall be the sum of Three Thousand One Hundred and Fifty Dollars ($3,150.00) per month, due and payable in advance to Lessor commencing on the Commencement date (“Rent”). Subsequent Rent shall be due in advance on the first (1
st) day of each month thereafter during the Term.
Rent shall be increased each year on the anniversary date of the Commencement Date by an amount equal to three percent (3%) of the Rent in effect for the previous year of the Term.
If Rent is not received by Lessor on or before the due date, it shall be deemed delinquent and the amount due and unpaid shall be subject to a late charge at the rate of 5% of the delinquent amount, without limiting Lessor’s other rights and remedies under this Agreement.
Notwithstanding any provision to the contrary, Less ee’s obligation to pay Rent is not dependent on any condition of this Sublease Agreement, or Les see’s use or ability to use the Property, and shall not be subject to any deduction or offset.
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Upon agreement of the Parties, Lessee may pa y the Rent by electronic funds transfer and in such event, Lessor agrees to provide to Lessee bank routing information for such purpose upon request.
2.2 Tax and Assessments. Lessee acknowled ges and understands that this Sublease may create a possessory interest that is subject to the payment of taxes levied on such interest.
It is understood and agreed that all taxes and assessments (including but not limited to said possessory interest tax) that become due an d payable upon the Property or upon fixtures, equipment or other property installed or construc ted thereon, shall be the full responsibility of Lessee such that Lessee shall cause said ta xes and assessments to be paid promptly.
SECTION 3. WARRANTIES OF TITLE AND QUIET ENJOYMENT
Lessor covenants that Lessor has leased the Property and has full right to make and perform under this Agreement. Upon payment by Lessee of the Rent for the Property and the observance and performance of all of the material covenants, conditions and provisions on Lessee’s part to be observed and performed under this Agreement, Lessee shall have the quiet use, possession and enjoyment of the Property for the en tire Term, subject to all of the provisions of this Agreement.
SECTION 4. USE OF PROPERTY; COMPLIANCE WITH LAWS
4.1 Use. Lessee shall use the Property for the sole purpose of operating an early childhood education center in conformity with the statutes, rules, regulations, deed restrictions, and policies established by all appropriate gove rnmental and/or licensing authorities for the operation of such facilities. Notwithstanding the foregoing, Lessee may engage in any use compatible with or in support of the operation of an early childhood education center. If Lessee would like to use the Property for anything other than what is set forth in this Agreement, Lessee shall obtain prior written consent from Lessor. Addi tionally, upon request, Lessee shall submit a report to Lessor that sets forth the activities and operation of Lessee for the period of time requested by Lessor. No human habitation shal l be allowed on the Property. Notwithstanding the foregoing sentence, Lessee shall be allowed a property designed and approved guard station for night water persons or other patrol.
4.2 Compliance with Prior Covenants, Conditions, and Restrictions. Lessee accepts the Property “where is” and “as is” and agrees that Lessee is subject to any and all existing covenants, conditions, restrictions, and excepti ons of record or apparent including provisions of that certain License Agreement entered into between the United States (Department of the Army) and the City of Fullerton on December 1, 1959, and any of its supplemental agreements (hereinafter collectively referred to as the “Lic ense Agreement”), are incorporated into this agreement as if set out in full and Lessee is bound and subject to each of said terms and conditions. A copy of the License Agreement is attached as Exhibit B. If a conflict exists between said License Agreement and this Agreem ent, the terms of the License Agreement shall prevail. Lessee affirms that they have had an opportunity to review the License Agreement with their own counsel and agree to abide by its terms. Nothing contained in this Agreement or in any document related hereto shall be construed to imply the conveyance to Lessee of rights in the Property which exceed those owned by Lessor.
4.3 Records Required Related to Lessee Use.
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The following information shall also be submitted by Lessee to Lessor within 90 days after the end of each year of the Term:
x The identity of the Board of Directors, including contact information for Board Chair and Executive Director;
x Any construction or improvements made to the building and any information related to funding source(s), date(s), description(s), etc. x Summary of programs and services provided to 1) Fullerton community specifically; and 2) greater area including the estimated number of participants in each; and;
4.4 Compliance with Laws; No Waste or Nuisance. Lessee, in its use of the Property, shall comply at all times with all applicable fe deral, state and local governmental laws and regulations applicable to the Property including obtaining any and all approvals, permits and/or licenses which may be required in connection with its use and/or operations on the Property or construction of any improvements on the Property. In addition, Lessee shall not use the Property in a manner that will cause the cancellation of any insurance policy covering the Property required by this Agreement to be maintained by Lessee unless Lessee has first replaced such policy at Lessee’s cost. In this regard, Lessee shall, at its sole cost and expense, comply with all commercially reasonable requirements pertaining to the Property or any reasonable insurance organization or company necessary for the maintenance of insurance on and for said Property.
Lessee shall not commit or permit any waste in or on the Property or any nuisance or any other act or thing which may disturb the quiet enjoyment of adjoining landowners or tenants.
4.5 Liability for Damage. Lessee shall remain solely and exclusively responsible and liable for any and all damage caused to the Property by Lessee's use of said Property.
4.6 City reserves the right to install, lay, construct, maintain, repair and operate such sewer lines, drain lines, laterals, manholes, and utilities (water, oil, gas, telephone, broadband, and power) and all appliances and appurtenances necessary or convenient in connection with, in over, upon, through, across, under, and along the Property or any part thereof, and to enter the Property for any and all such purposes. City also reserves the right to grant franchises, easements, rights-of-way, and permits in over, upon, through, across, under, and along any and all portions of the Property. No right reserved by City in this Section shall be exercised as to interfere unreasonably with Lessee’s operations hereunder or to impair the security of any secured creditor of Lessee except in the event of an emergency. City shall provide thirty days advanced written notice of City’s exercise of it s reservation of rights. For purpose of this Section, unreasonable interference is defined as the ability to operate its preschool due to noise, noxious odor or physical access to the Property between the hours of 9:00 am and 12:00 pm.
Monday through Friday from the months of $XJXVW through -XQH. City agrees that rights granted to third parties by reason of this Section shall contain provisions that the surface of the land shall be restored as nearly as practicable to its original condition upon the completion of any construction, excepting those portions required for the slope remediation project.
4.7 Noncompliance with this section shall constitute a material breach of this Agreement.
SECTION 5. MAINTENANCE; ALTERATIONS; SURRENDER
5.1 Maintenance. Lessee shall, throughout the Term, at its sole cost and expense, keep and maintain the Property in neat order, good condition and repair; and shall restore and, subject to Section 26, to the extent of insurance proceeds received from policies required to be maintained by Lessee hereunder, rehabilitate any improvements which may be destroyed or damaged by any cause whatsoever. Lessor shall not be obligated to make any repairs, replacements or renewals of any kind, nature or description whatsoever to the Property, except to the extent caused by Lessor or its agents or representatives or as set forth herein. Without limiting the foregoing, Lessee shall be solely responsible to use commercially reasonable maintenance and repair practices to keep all and every part of the Property, the fixtures and appurtenances, in good order and repair, in a clean and wholesome condition, free from dirt and accumulation of waste, boxes or other rubbish except for such maintenance obligations as City expressly assumes herein.
City will provide building maintenance, facility capital repair and landscape maintenance.
Building maintenance includes general maintenance to the buildings and fixtures and does not include maintenance of equipment, data and telephone lines or personal property. 7KH /HVVHH VKDOOLQIRUPWKH3DUNVDQG5HFUHDWLRQGHSDUWPHQWLQZULWLQJRI DQ\QHHGIRUIDFLOLW\PDLQWHQDQFH UHSDLUV Facility capital repair includes scheduled replacement of the roof, flooring, exterior and interior painting and the HVAC system. Landscape maintenance includes irrigation repair and replacement, tree trimming, rodent control, and maintenance of plants and shrubbery.
Landscape maintenance of the playground areas within the fenced yards of the Property is not included with the exception of tree trimming and rodent control. Lessee is financially responsible for maintenance of the playground and playground amenities.
Lessor retains the right to inspect the Property at any reasonable time on at least five (5) business days’ prior written notice to Lessee (except in emergencies where Lessor shall provide such prior notice as is reasonably practicable) to determine if Lessee is in compliance with its repair and maintenance obligations under this Agreement. Lessee agrees that in the event Lessee fails to perform hereunder, following notice and reasonable opportunity to cure the alleged “Default” (as provided below in this Agreement), Lessor may, at its option, enter upon theProperty and repair the same as in its judgment may be necessary, and the reasonable cost andexpense of such repairs shall be paid by Lessee within thirty (30) days after Lessee’s receipt of an invoice for the same and reasonable supporting documentation. Notwithstanding any of theforegoing, the Lessor shall not be obligated to repair any damage caused by Lessee.
5.2 Alterations and Improvements. Subject to this section and Section 26, Lessee shall not make or permit any alteration or improvement to the Property, or any part thereof, without the prior written consent of Lessor, which consent shall not be unreasonably withheld by Lessor if it is consistent with Lessee’s permitted use of the Property pursuant to this Agreement. Any structural additions to or permanent alterations of the Property (except for trade fixtures and personal property) shall become at once a part of the Property and belong to Lessor on expiration or earlier termination of this Agreement.
5.3 Surrender. Upon expiration of the Term or earlier termination of this Agreement, and subject to Section 26, Lessee shall deliver to Lessor the Property, together with all improvements and appurtenances thereto, in good order and condition, reasonable wear and tear excepted. Notwithstanding the previous sentence, on such expiration or earlier termination, Lessee shall have the right, but not the obligation, to remove its personal property and trade fixtures and equipment from the Property.
SECTION 6. UTILITIES
To the extent permitted by the applicable utility, Lessee shall cause to be installed separate meters and/or cause to be invoiced separate from Lessor for Lessee’s use of any XWLOLW\DW WKH3URSHUW\$OOVHSHUDWHO\PHWHUHGRULQYRLFHGZDWHUVHZHUJDVHOHFWULFLW\WUDVKDQGWHOHSKRQH Fullerton Community Nursery School
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services; sanitation district fees; and other utility services used on or furnished to the Property for Lessee’s useduring the Term shall be paid for by the Lessee.
SECTION 7. LESSEE'S SIGNS
No sign or other permanent advertisement shall be displayed on the outside of the Property without the prior written consent of Lessor, wh ich consent shall not be unreasonably withheld.
Temporary banners and similar de vices shall be permitted so long as they are consistent with Lessee’s permitted use hereunder and with all applicable zoning and land use requirements. In addition, a permanent sign or advertisement shall be reasonable if: (a) it is consistent with Lessee’s permitted use of the Property; and (b) is in compliance with applicable laws and regulations. Lessor consents to all existing signs or advertisement s displayed on the exterior of the Property on the commencement of the Term.
SECTION 8. LIENS
Lessee shall keep the fee estate of said Property free and clear from all mechanics and materialmen liens and other liens for work or labor done, services performed, materials, appliances used, or furnished or to be used in or about the Property for or in connection with any operation of Lessee, for any repairs or im provements which Lessee may make or permit to cause to be made, or any work or construction by, for or permitted by Lessee on or about said Property.
SECTION 9. INDEMNIFICATION
Lessee agrees to defend, indemnify, hold free and harmless Lessor, its elected officials, officers, agents, volunteers and employees (“Indemnitees”) at Lessee's sole expense from and against any and all claims, demands, suits, actions or proceedings of any kind or nature including, but not by way of limitation, all civil claims, workers' compensation claims, damages to property, or injuries to or death of any person or persons, and all other claims resulting from or arising out of the use or occupancy of the Property by Lessee or the acts, errors or omissions of Lessee, its officers, ag ents, volunteers, employees, occupants, visitors or other users and/or authorized subcontractors, whether intentional or negligent, except to the extent such claim, demand, suit, action or pro ceeding, civil claim, worker’s compensation claim, damage to property, injury to or death of any person arises from the sole active negligence or willful misconduct of Indemnitees.
The defense obligation provided for hereunder shall apply without any advance showing of negligence or wrongdoing by Lessee, its officers, agents, volunteers, employees, occupants, visitors or other users and/or authorized subcontractors, but shall be required whenever any claim, demand, suit, action or proceeding, civil claim, w orker’s compensation claim, damage to property, injury to or death of any person asserts liability against Indemnitees based upon Lessee, its officers, agents, volunteers, employees, occupants, visitors or other users and/or authorized subcontractors use or occupancy of the Property or the acts, errors or omissions of Lessee, its officers, agents, volunteers, employees, occupants, visitors or other users and/or authorized subcontractors.
SECTION 10. ASSIGNMENT AND SUBLETTING
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Without the prior written consent of Lessor, Lessee shall not assign this Sublease or sublet the Property or any part thereof without first obtai ning the written consent of the Lessor, which consent may require an increase in Rent.
SECTION 11. ENCUMBRANCE OF LEASEHOLD INTEREST
Lessee may not encumber or mortgage by deed of trust or other instrument its leasehold interest and estate in the Property.
SECTION 12. DEFAULT; REMEDIES
12.1 Default. Either party to this Agreement shall be in Default under this Agreement (“Default”) if:
(a) Such party shall fail to pay any amount due under this Sublease within fifteen (15) business days after written notice from the other party describing the alleged Default in reasonable detail and demanding payment, which notice shall not be sent until after the due date of such payment; or (b) Such party shall neglect to observe, keep or perform any of the covenants, terms or conditions herein contained on its part to be observed, kept or performed other than the payment of money covered by subpart (a) above, and if such alleged Default shall continue for a period of sixty (60) calendar days after written notice from the other party, which notice shall describe the alleged Default in reasonable detail and demand cure of the Default, and shall not be sent until after the du e date of such performance; provided, however, that if the nature of the alle ged Default is such that it cannot reasonably be cured within such 60 day period, then the party alleged to be in Default shall not be in Default if such party commences the cure of such alleged Default within such period and diligent continues the cure to completion.
12.2 Remedies. If either party is in Default unde r this Sublease, then the other party shall have all applicable legal and equitable rights and remedies, including without limitation the right to terminate this Agreement and all rights of each party hereunder.
SECTION 13. NOTICES
Wherever in this Sublease it shall be require d or permitted that notice be given by either party, such notice must be in writing and be given personally or forwarded by certified mail or overnight delivery service such as FedEx, addressed as follows:
IF TO LESSEE: IF TO LESSOR:
Fullerton Community Nursery School
2050 Youth Way
Fullerton, CA 92835
Attn
: Executive Director
City of Fullerton
303 W. Commonwealth Ave.
Fullerton, CA 92832
Attn: Parks and R
ecreatio n Director
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The effective date of any notice or written comm unications sent by one party to the other shall be the date received if by personal service, the date of the overnight delivery company’s confirmation of delivery if sent by overnight delivery, or three (3) busi ness days after deposit in the US Mail if sent by mail (as reflected by offi cial US postmark). Either party may change its address by giving notice in writing to the other party.
SECTION 14. BANKRUPTCY
A. The Lessor and the Lessee hereby expressl y agree and acknowledge that it is the intention of both parties that in the event that during the term of this Ag reement if Lessee shall become a debtor in any voluntary or involuntar y bankruptcy proceeding (a “Proceeding”) under the United States Bankruptcy Code, 11 U.S. C. 101, et seq. (the “Code”), this Agreement is and shall be treated for all purposes and consider ed for all intents as an unexpired lease of nonresidential real property for purposes of Section 365 of the Code, 11 U.S.C. 365 (as may be amended), and, accordingly, shall be subject to the provisions of subsections (d)(3) and (d)(4) of said Section 365 (as may be amended).
B. Any person or entity to which this Agr eement is assigned pursuant to the provisions of the Bankruptcy Code, 11 USC Sections 101, et seq., shall be deemed without further act to have assumed all of the obligations of Lessee arisi ng under this Agreement both before and after the date of such assignment. Any such assignee upon demand shall execute and deliver to Lessor an instrument confirming such assumption. Any monies or other considerations payable or otherwise to be delivered in connection with such assignment shall be paid to Lessor, shall be the exclusive property of Lessor, and shall not constitute property of the Lessee or of the estate of Lessee within the meaning of the Bankruptcy Code. Any monies or other considerations constituting Lessor's property under the preceding sentence not paid or delivered to Lessor shall be held in trust for the benefit of Lessor and be promptly paid to Lessor.
SECTION 15. ABANDONMENT BY LESSEE
If Lessee shall fail to use the Property, which is fit for occupancy, for a period of ninety (90) consecutive days, the Property shall be considered aban doned and the Term terminated.
SECTION 16. WAIVER
The delay or failure of either party at any time to require performance or compliance by the other of any of its obligations or agreements shall in no way be deemed a waiver of those rights to require such performance or comp liance. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the party against whom enforcement of a waiver is sought. The waiver of any right or remedy in respect to any occurrence or event shall not be deemed a waiver of any right or remedy in respect to any other occurrence or event, nor shall any waiver constitute a continuing waiver.
SECTION 17. INSURANCE
17.1 Minimum Scope and Limits of Insuran ce. Lessee shall obtain, maintain, and keep in full force and effect during the term of this Sublease all of the following minimum scope of insurance coverages:
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(a) Commercial general liability, including premises-operations, products/completed operations, broad form property damage, blanket contractual liability, independent contractors, personal injury or bodily injury with a policy limit of not less than Two Million Dollars ($2,000,000.00), combined single limits, per occurrence. If such insurance contains a general aggregate limit, it shall apply separately to this Agreement or shall be twice the required occurrence limit, (b) Automobile liability for owned vehicles, hired, and non-owned vehicles, with a policy limit of not less than One Million Dollars ($1,000,000.00), combined single limits, per occurrence for bodily injury and property damage.
(c) Workers' compensation insurance as required by the State of California.
17.2 Endorsements. The commerc ial general liab ility policy shall contain or be endorsed to contain the following provisions:
(a) Additional insureds: “The City of Fullerton and its elected and appointed boards, officers, agen ts, and employees are additional insureds with respect to the Prope rty and contract with the City.” (b) Other insurance: “Any other insurance maintained by the City of Fullerton shall be excess and not contributing with the insurance provided by this policy.”
17.3 Certificates of Insurance: Upon wr itten request from Lessor, Lessee shall provide to City certificates of insurance showing the insurance coverages and required endorsements described a bove in a form and content approved by City.
17.4 Non-limiting: Nothing in this Section shall be construed as limiting in any way the indemnification provision contained in this Agreement or the extent to which Lessee may be held responsible for payments of damages to pe rsons or property.
17.5 Right of Reasonable Increase. Lessor re serves the right to review industry standards and a comparison of similar buildings in the area and impose a reasonable increase of the insurance limits every three (3) years from the effective date of this Agreement.
17.6 Lessee will provide notice to Lessor of cancellation, suspension, or reduction in coverage immediately upon receipt of notice of same by Lessee, but in no event shall Lessee notify Lessor later than thirty (30) days following Lessee’s receipt of said notice.
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SECTION 18. SUBSTITUTE PERFORMANCE
If Lessor fails to perform any material obligation of Lessor under this Agreement within thirty (30) days after written notice from Lesse e describing the performance in reasonable detail, which notice shall not be sent until after the due date for such performance, then Lessee shall have the right to perform the obligation at the cost of Lessor, and Lessor shall pay Lessee the reasonable cost of such performance within thirty (30) days after Lessor’s receipt of an invoice for the same and reasonable supporting documentation.
SECTION 19. ATTORNEYS’FEES
In the event that litigation is brought by any party in connection with this Agreement, the prevailing party shall be entitled to rec over from the opposing party all costs and expenses including reasonable attorneys' fees in curred by the prevailing party in the exercise of any of its rights or remedies hereunder or the enforcement of any of the terms, conditions, or provisions hereof.
SECTION 20. REPRESENTATIVES
Lessor’s City Manager or his/her de signee shall be the repres entative of Lessor for purposes of this Agreement and may issue all consents, approvals, directives and agreements on behalf of Lessor called for by this Agreement. Eric Levitt is the City Manager upon commencement of the Term.
The Executive Director of Lessee or his/her designee shall be the representative of Lessee for purposes of this Agreement, and Melissa Brewer of Lessee is the current Executive Director upon commencement of the Term.
Either party to this Agreement shall have the right to change such party’s representative at any time by written notice to the other party.
SECTION 21. HAZARDOUS MATERIALS
As used herein the term “Hazardous Ma terial” means any hazardous or toxic substance, material or waste which is or sh all become regulated by any governmental entity, including without limitation, City ac ting in its governmental capacity, the State of California or the United States Government.
21.1 Lessee shall not cause or permit any Hazardous Material to be brought upon, kept or used in or about the Property except as specifically authorized by Lessor in writing.
Any such authorization by Lessor shall not alter or reduce Lessee’s obligations under this section, including but not limited to its duty to indemnify and defend Lessor for any contaminations which may occur as a result of Lessee’s use of the authorized material.
21.2 If Lessee is in Default of its obliga tions under Section 21.1 and thereby causes contamination of the Property by Hazar dous Materials for which Lessee is legally liable to Lessor for damage resulting therefrom, then Lessee shall indemnify, defend and hold Lessor harmless from any and all claims, judgments, cleanup costs, remediation orders, damages, penal ties, fines, costs, liabilities or losses (includes, without limitation, diminution in value of the Property, damages fo r the loss or restriction on use of rentable or usable space or any amenity of the Propert y, damages arising from any adverse impact Fullerton Community Nursery School Page | 10
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on marketing of space in the Property or portion of any building of which the Property is a part, and sums paid in settlement of claims , attorney’s fees, consultant fees and expert witness fees) that arise as a result of such contamination.
21.3 The indemnification requirement here in includes, without limitation, costs incurred by Lessor in connection with any inve stigation of site condi tions or any cleanup, remediation, removal or restoration work required by any federal, state or local governmental entity because of Hazardous Mate rial being present in the soil, ground water or under the Property. Lessee shall promptly take all actions at its sole cost and expense as are necessary to clean, remove, and rest ore the Property to its condition prior to the introduction of such Hazardous Material by Lessee; provided, however, that Lessee shall first ha ve obtained Lessor’s approval and the approval of any necessary governmental entities.
SECTION 22. HOLDING OVER
Any holding over after the expiration of the term hereof, or any extension thereof, with the consent of Lessor, shall be deemed to be a tenancy from month to month only, on the same terms, conditions and covenants as are herein provided so far as applicable.
SECTION 23. MEMORANDUM OF SUBLEASE
Concurrently with the execution and delivery of this Agreement, Lessor and Lessee shall cooperate to prepare and record a short form memorandum of this Agreement upon request of either Party. Lessee shall bear all costs and e xpenses associated with preparation and recordation of such memorandum.
SECTION 24. SUBORDINATION AND NON-DISTURBANCE
24.1 Subordination. Subject to compliance with Section 24.3 and subject to Section 25, this Agreement shall be subject and subordinate to any bond, mortgage, deed of trust, or any other hypothecation or security device (collectively a “Security Device”) now or hereafter placed by Lessor upon the Property, to any and all advances made on the security thereof, and to all renewals, modifications, consolidations, replacements and exten sions thereof. Subject to compliance with Section 24.3, if any Lessor lender shall elect to ha ve this Agreement superior to the lien of its Security Device and shall give written notice thereof to Lessee, then this Agreement shall be deemed prior to such Security Device, notwithstanding the relative dates of the documentation or recordation thereof.
24.2 Attornment. Subject to the non-disturb ance provisions of Section 24.3, Lessee agrees to attorn under this Agreement to any Lessor lender or other party who acquires ownership of the Property by reason of a foreclosure of a Security Device.
24.3 Non-Disturbance . With respect to all Security Devices entered into by Lessor (whether existing prior to the comm encement of the Term or thereafter), Lessee’ssubordination of this Agreement shall be subject to receiving a non-disturbance agreement, in form and content reasonably acceptable to Lessee, providing that so long as Lessee performs its obligations under this Agreement , Lessee’s quiet use, enjoyment and possession of the Property shall not be disturbed by any holder of a Security Device. Conc urrently with execution and delivery of this Fullerton Community Nursery School Page | 11
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Agreement, Lessor shall deliver to Lessee a non-disturbance agreement for each Security Device (if any exists) relating to the Property that is in existence as of the commencement of the Term.
24.4 Self-Executing. Subject to Lessee’s receipt of the non-disturbance agreement(s) specified in Section 24.3, the agreements contained in this Section 24 shall be effective without the execution of any further documents; provided however, that upon written request from Lessor or a Lessor lender in connection with a sale, fi nancing or refinancing of the Property, Lessee and Lessor shall execute such further writings as may be reasonable required to separately document any such subordination, attornment and/or non-disturbance agreement as is provided for herein.
SECTION 25. NO REPRESENTATION, WARRANTY, OR GUARANTEE;
ACKNOWLEDGEMENT OF KNOWLEDGE OF LIMITATIONS AND
REQUIREMENTS OF ARMY CORP OF ENGINEER LEASE
Lessee acknowledges and agrees the Lessor is not making any representation, warranty, or guarantee in this Agreement regarding any certif icate, permit, or other approval that may be required by any Federal, State, or local authority, including by Lessor in its capacity as municipal land use authority, which may be required of Lessee.
By way of explanation, this Section is not intended to prohibit or restrict Lessee ’s use of the Property during the term of this Agreement, but is intended to establish that the Lessor is not making any promises in regards to approval of any future proposed uses of the Property or in regards to any governmental approval Lessee may require in the future.
In addition, Lessee acknowledges that is has received, has reviewed, and has knowledge of the limitations and requirements of the City’s lease with the Army Corp of Engineers attached to this Lease as Attachment B.
SECTION 26. DAMAGE AND DESTRUCTION
In the event of any damage or destructio n of the Property or the improvements to the Property:
A. If caused by Lessor or its representative s or agents, then Lessor shall, at Lessor’s cost, promptly repair and restore the Pr operty to the condition in effect immediately prior to the casualty.
B. If not caused by Lessor or its represen tatives or agents, then: (i) within one hundred and twenty days (120) days after the casualty, Lessee shall notify Lessor in writing of Lessee’s election to either repair and restore the Property; or (ii) terminate th is Agreement. If Lessee elects to terminate the Agreement, then: (a) the Agreement shall terminate on the date set forth in notice from Lessee, which date shall be within 180 days after the date of the casualty; and (b) any available insurance proceeds from insurance required to be carried by Lessee or Lessor pu rsuant to this Agreement shall be paid to Lessor. If Lessee elects to repair and restore the Property, then: (1) any available insurance proceeds from insurance required to be carried by Lessee or Lessor pursuant to this Agreement shall be applied to such repair and restoration efforts; (2) Lessee shall commence such repair and restoration effort s within one hundred and eighty (180) days after the date of the casualty and shall use commercially reasonable efforts to complete the same, with due allowance for any fund-raisi ng efforts of Lessee required to supply any funds not provided by insurance proceeds under (1) of this sentence; and (3) this Fullerton Community Nursery School Page | 12
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Agreement shall remain in full force and eff ect, except Rent shall be abated during the repair and restoration.
SECTION 27. ENTIRE AGREEMENT
This Sublease Agreement: (a) is intended by the parties hereto as the final expression and the complete and exclusive statement of their agreement with respect to the terms included in this Agreement, and any prior or contemporaneous agreements or understandings, oral or written, which may contradict, explain or supplement these terms shall not be admissible or effective for any purpose; (b) amends, restates and replaces in its entirety the Original Lease Agreement; (c) shall be binding upon and inure to the benefit of the parties hereto and their permitted successors and assigns; and (d) may not be amended or modified except by a writing signed by the parties which expressly states that it amends this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Sublease Agreement to be executed by and through their respective authorized officers, as of the date first above written.
CITY OF FULLERTON,
A Municipal Corporation
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ATTACHMENT A
Assessor’s Map 028-050-36
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ATTACH MENT B
License Agreement