South El Monte City Council
June 28, 2022

ATTACHMENT(S):

A. Resolution No. 22-49
B. Exhibit A to Resolution No. 22-49

ATTACHMENT A

RESOLUTION NO. 22-49

A RESOLUTION OF THE SOUTH EL MONTE CITY COUNCIL
ESTABLISHING THE FISCAL YEAR 2022-23

APPROPRIATIONS LIMIT FOR THE CITY PURSUANT TO

ARTICLE XIIIB OF THE CALIFORNIA CONSTITUTION
WHEREAS, the voters of the State of California in November 1979 added Article XIIIB (Proposition 4) to the State Constitution placing various limitations on the appropriations of the State and local governments; and
WHEREAS, the voters of the State of California in June 1990 modified Article XIIIB by approving Proposition 111, which revised the annual adjustment factors to be applied to the 1986- 87 limit and each year thereafter; and
WHEREAS, the City of South El Monte has complied with all provisions of Article XIIIB in determining the Appropriation Limit for the 2022-23 fiscal year.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SOUTH EL MONTE HEREBY RESOLVES:

SECTION 1. The Appropriation Limit for the 2022-23 Fiscal Year shall be $170,135,936 for the City as determined by Exhibit A attached hereto.

SECTION 2. The inflation factor being used to calculate the Fiscal Year 2022-23 appropriations limit is the increase in the City’s property taxable values due to non-residential new construction as a percentage of the total taxable value increases as of the Fiscal 2021-22 lien year roll date.

SECTION 3. The population factor being used to calculate the Fiscal Year 2022-23 appropriations limit is the City’s population growth between January 1, 2021 and January 1, 2022, as reported by the State Department of Finance.

SECTION 4. The City Clerk shall certify to the adoption of this resolution.

PASSED, APPROVED AND ADOPTED this 28th day of June 2022.

___________________________________
Gloria Olmos, Mayor
ATTEST:
____________________________
Donna G. Schwartz, City Clerk

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:

CITY OF SOUTH EL MONTE )
I, Donna G. Schwartz, City Clerk of the City of South El Monte, hereby certify that the foregoing Resolution, being Resolution No.22-49, was duly passed and approved by the City Council of the City of South El Monte at a Regular meeting of said Council held on the 28th day of June 2022, and that said Resolution was adopted by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_______________________________
Donna G. Schwartz, City Clerk

ATTACHMENT B

Exhibit A
CITY of SOUTH EL MONTE
Article XIIIB Appropriations Limit
Fiscal Year 2022-2023
Appropriations Limit
A. Fiscal Year 2021-2022 Limit 157,096,894
B. Adjustment Factors:

1. Population % 1.00700

2. Inflation % 1.07550
Total Adjustment % 1.08300
C. Annual Adjustment $ 13,039,042
D. Fiscal Year 2022-2023 Limit 170,135,936

CITY of SOUTH EL MONTE
Article XIIIB Appropriations Limit
Fiscal Year 2022-2023
Percentage Change in Population % Change Factor
City of South El Monte 0.70% 1.00700
County of Los Angeles -0.71% 0.99290
Population Factor Selected:

City of South El Monte 1.00700
Percent Change in Price % Change Factor
California Per Capita Personal Income 7.55% 1.07550
Non-Residential Assessed Valuation 4.04% 1.04040
Price Factor Selected:

California Per Capita Personal Income 1.07550
Appropriation Limit Adjustment Factors

: http://leginfo.legislature.ca.gov/faces/codes.xhtml.

May 2022
Dear Fiscal Officer:

Subject: Price Factor and Population Information
Appropriations Limit
California Revenue and Taxation Code section 2227 requires the Department of Finance to transmit an estimate of the percentage change in population to local governments. Each local jurisdiction must use their percentage change in population factor for January 1, 2022, in conjunction with a change in the cost of living, or price factor, to calculate their appropriations limit for fiscal year 2022-23. Attachment A provides the change in California’s per capita personal income and an example for utilizing the price factor and population percentage change factor to calculate the 2022-23 appropriations limit. Attachment B provides the city and unincorporated county population percentage change. Attachment C provides the population percentage change for counties and their summed incorporated areas. The population percentage change data excludes federal and state institutionalized populations and military populations.

Population Percent Change for Special Districts
Some special districts must establish an annual appropriations limit. California Revenue and Taxation Code section 2228 provides additional information regarding the appropriations limit.

Article XIII B, section 9(C) of the California Constitution exempts certain special districts from the appropriations limit calculation mandate. The code section and the California Constitution can be accessed at the following website
Special districts required by law to calculate their appropriations limit must present the calculation as part of their annual audit. Any questions special districts have on this requirement should be directed to their county, district legal counsel, or the law itself. No state agency reviews the local appropriations limits.

Population Certification
The population certification program applies only to cities and counties. California Revenue and Taxation Code section 11005.6 mandates Finance to automatically certify any population estimate that exceeds the current certified population with the State Controller’s Office. Finance will certify the higher estimate to the State Controller by June 1, 2022.

Please Note: The prior year’s city population estimates may be revised. The per capita personal income change is based on historical data.

If you have any questions regarding this data, please contact the Demographic Research Unit at (916) 323-4086.

KEELY MARTIN BOSLER
Director
By:

ERIKA LI
Chief Deputy Director
Attachment

May 2022
Attachment A
A. Price Factor: Article XIII B specifies that local jurisdictions select their cost of living factor to compute their appropriation limit by a vote of their governing body. The cost of living factor provided here is per capita personal income. If the percentage change in per capita personal income is selected, the percentage change to be used in setting the fiscal year 2022-23 appropriation limit is:

Per Capita Personal Income
Fiscal Year Percentage change
(FY) over prior year
2022-23 7.55
B. Following is an example using sample population change and the change in California per capita personal income as growth factors in computing a 2022-23 appropriation limit.
2022-23:

Per Capita Cost of Living Change = 7.55 percent
Population Change = -0.30 percent
Per Capita Cost of Living converted to a ratio: 7.55 + 100 = 1.0755 100
Population converted to a ratio: -0.30 + 100 = 0.997
100
Calculation of factor for FY 2022-23: 1.0755 x 0.997 = 1.0723

Fiscal Year 2022-23
Attachment B
Annual Percent Change in Population Minus Exclusions*
January 1, 2021 to January 1, 2022 and Total Population, January 1, 2022 Total
County Percent Change --- Population Minus Exclusions --- Population City 2021-2022 1-1-21 1-1-22 1-1-2022
Los Angeles
Agoura Hills -1.02 19,975 19,771 19,771
Alhambra -0.42 82,182 81,834 81,834
Arcadia -0.54 56,240 55,934 55,934
Artesia -0.74 16,261 16,140 16,226
Avalon -0.99 3,428 3,394 3,394
Azusa -0.97 50,191 49,704 49,704
Baldwin Park -0.84 71,455 70,855 70,855
Bell -1.00 33,962 33,624 33,624
Bellflower -0.96 78,107 77,359 77,359
Bell Gardens -1.03 39,265 38,861 38,861
Beverly Hills -0.92 32,565 32,265 32,265
Bradbury -1.09 914 904 904
Burbank -0.77 106,268 105,451 105,451
Calabasas -0.97 23,151 22,926 22,926
Carson -0.59 92,912 92,362 92,362
Cerritos -1.08 49,163 48,634 48,634
Claremont -0.78 37,364 37,072 37,072
Commerce -1.08 12,273 12,140 12,140
Compton -1.08 95,261 94,233 94,233
Covina -0.95 50,933 50,449 50,449
Cudahy -0.92 22,526 22,318 22,318
Culver City -0.48 40,330 40,135 40,135
Diamond Bar -1.06 54,782 54,204 54,204
Downey -0.83 113,525 112,584 112,584
Duarte -1.00 21,473 21,258 21,258
El Monte -0.94 108,728 107,706 107,706
El Segundo -0.93 17,244 17,084 17,084
Gardena -0.72 60,382 59,947 59,947
Glendale -0.77 194,618 193,116 193,116
Glendora -0.95 52,316 51,821 51,821
Hawaiian Gardens -0.99 13,755 13,619 13,619
Hawthorne -1.00 87,722 86,841 86,841
Hermosa Beach -1.09 19,382 19,171 19,171
Hidden Hills 0.12 1,736 1,738 1,738
Huntington Park -1.06 54,519 53,942 53,942
Industry -0.45 440 438 438
Inglewood -0.62 107,143 106,481 106,481
Irwindale 0.54 1,482 1,490 1,490
*Exclusions include residents on federal military installations and group quarters residents in state mental institutions, state and federal correctional institutions and veteran homes.

Fiscal Year 2022-23
Attachment B
Annual Percent Change in Population Minus Exclusions*
January 1, 2021 to January 1, 2022 and Total Population, January 1, 2022 Total
County Percent Change --- Population Minus Exclusions --- Population City 2021-2022 1-1-21 1-1-22 1-1-2022
La Canada Flintridge -1.03 20,291 20,081 20,081
La Habra Heights -1.08 5,655 5,594 5,594
Lakewood -0.99 81,681 80,876 80,876
La Mirada -0.77 49,074 48,696 48,696
Lancaster -0.62 172,298 171,234 175,164
La Puente -0.10 37,626 37,587 37,587
La Verne -0.93 32,608 32,304 32,304
Lawndale -1.07 31,638 31,301 31,301
Lomita -1.05 20,851 20,633 20,633
Long Beach 0.20 459,711 460,636 460,682
Los Angeles -0.88 3,851,093 3,817,053 3,819,538
Lynwood -0.80 67,260 66,723 66,723
Malibu -0.49 10,739 10,686 10,686
Manhattan Beach -1.29 35,357 34,902 34,902
Maywood -0.87 25,033 24,814 24,814
Monrovia -0.65 37,809 37,563 37,563
Montebello -0.90 62,180 61,622 61,622
Monterey Park -1.00 60,814 60,207 60,207
Norwalk -0.56 101,517 100,946 101,645
Palmdale -0.89 168,895 167,398 167,398
Palos Verdes Estates -1.04 13,116 12,980 12,980
Paramount -1.00 53,009 52,477 52,477
Pasadena -0.52 139,029 138,310 138,310
Pico Rivera -0.62 61,827 61,442 61,442
Pomona 0.60 148,879 149,766 149,766
Rancho Palos Verdes -0.98 41,861 41,451 41,468
Redondo Beach -1.10 69,742 68,972 68,972
Rolling Hills -1.12 1,703 1,684 1,684
Rolling Hills Estates 0.07 8,283 8,289 8,289
Rosemead -0.61 50,823 50,511 50,511
San Dimas -0.86 34,651 34,352 34,352
San Fernando 0.00 23,520 23,519 23,519
San Gabriel -1.03 39,250 38,845 38,845
San Marino -0.62 12,334 12,257 12,257
Santa Clarita 0.33 228,084 228,835 228,835
Santa Fe Springs 1.05 18,523 18,718 18,763
Santa Monica -0.89 93,242 92,408 92,408
Sierra Madre -0.86 10,959 10,865 10,865
Signal Hill -0.90 11,702 11,597 11,597
South El Monte 0.70 19,532 19,668 19,668
*Exclusions include residents on federal military installations and group quarters residents in state mental institutions, state and federal correctional institutions and veteran homes.

Fiscal Year 2022-23
Attachment B
Annual Percent Change in Population Minus Exclusions*
January 1, 2021 to January 1, 2022 and Total Population, January 1, 2022 County
City
Percent Change
2021-2022
--- Population Minus Exclusions ---
1-1-21 1-1-22
Total
Population
1-1-2022
South Gate
South Pasadena
Temple City
Torrance
Vernon

0.51 -1.00
-0.64
-0.99
-0.95
92,783
26,849
36,497
145,876
210
93,259
26,580
36,262
144,433
208
93,259
26,580
36,262
144,433
208
Walnut
West Covina
West Hollywood
Westlake Village
Whittier
Unincorporated
-0.88
-0.96
-0.43
-0.96

0.05 -0.67
28,344
109,290
35,553
8,121
87,886
1,016,054
28,094
108,243
35,399
8,043
87,931
1,009,225
28,094
108,243
35,399
8,043
87,931
1,009,857
County Total -0.71 9,923,635 9,853,284 9,861,224
*Exclusions include residents on federal military installations and group quarters residents in state mental institutions, state and federal correctional institutions and veteran homes.



























 



















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City Council Agenda Report
Agenda Item No. 9.c.

DATE: June 28, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Rachel Barbosa, City Manager
SUBMITTED BY: Rene Salas, Deputy City Manager
SUBJECT: CONSIDERATION OF RESOLUTION 22-50, APPROVING

MEMORANDUM OF AGREEMENT (MOA) BETWEEN THE

CITY OF SOUTH EL MONTE AND SAN GABRIEL VALLEY

COUNCIL OF GOVERNMENTS SGVCOG TO RECEIVE
$50,000 IN GRANT FUNDS FOR HOMELESS PROGRAM
SERVICES FOR FY 22-23
SUMMARY: The San Gabriel Valley Council of Governments (SGVCOG) has funding opportunities through the County of Los Angeles for the purposes of administering Measure H funding allocations in support of the County's Homeless Initiative (HI) strategies to combat homelessness in the San Gabriel Valley. The city of South El Monte intends to use the $50,000 in available SGVCOG Measure H funds to supplement existing homeless service programs.

RECOMMENDED ACTION: Staff recommends City Council adopt Resolution 22-50, approving the Memorandum of Agreement with the San Gabriel Valley Council of Governments.

FISCAL IMPACT: The $50,000 is a reimbursable grant. As homeless services are provided, city staff will submit quarterly reimbursements to SGVCOG. There is no fiscal impact on this action at this time.

DISCUSSION: The SGVCOG was established to have a unified voice among cities within the San Gabriel Valley, to maximize resources and advocate for regional and member interests to improve the quality of life in the San Gabriel Valley by the member cities and other local governmental agencies. The City of South El Monte has developed a homeless program that supports the County Homeless Initiative on strategies and solutions to prevent and decrease homelessness within the City.

The City and the SGVCOG have the shared desire to continue implementing homeless programs that would combat homelessness in the San Gabriel Valley. To that end, the City and the SGVCOG desire to set forth the terms of their ongoing collaboration with

respect to this effort in a memorandum of agreement (MOA), the details of which are outlined in the scope of work, attached as Exhibit A to the MOA.

ATTACHMENT(S):

A. Resolution No. 22-50
B. Memorandum of Agreement

ATTACHMENT A

RESOLUTION NO. 22-50

A RESOLUTION OF THE SOUTH EL MONTE CITY COUNCIL

APPROVING A MEMORANDUM OF AGREEMENT (MOA)

BETWEEN THE CITY OF SOUTH EL MONTE AND THE SAN

GABRIEL VALLEY COUNCIL OF GOVERNMENTS (SGVCOG)
REGARDING PARTICIPATION IN THE CITY’S HOMELESS

PROGRAMS
WHEREAS, SGVCOG was established to have a unified voice to maximize resources and advocate for regional and member interests to improve the quality of life in the San Gabriel Valley by the member cities and other local governmental agencies; and WHEREAS, the City of South El Monte is a member of SGVCOG; and WHEREAS, SGVCOG entered into a contract with the County of Los Angeles for the purposes of administering Measure H funding allocations in support of the County's Homeless Initiative (HI) strategies to combat homelessness in the San Gabriel Valley; and WHEREAS, SGVCOG allocated a portion of this funding towards the implementation of member cities previously developed homeless plans, the development of programs to prevent homelessness, the implementation of pilot programs, and outreach services; and WHEREAS, the City of South El Monte’s homeless programs do support strategies and solutions to prevent and decrease homelessness within the City, based on local concerns and priorities; and
WHEREAS, the City of South El Monte and the SGVCOG have a shared desire to successfully develop homeless programs, to combat homelessness in the San Gabriel Valley; and WHEREAS, the City Council of the City of South El Monte now desires to set forth the terms of the ongoing collaboration with SGVCOG in respect to this effort in an MOA.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South El Monte as follows:

SECTION 1. The City Council hereby approves a Memorandum of Agreement (MOA) between the City and the San Gabriel Valley Council of Governments to partially fund the city’s homeless programs with $50,000 in Measure H funds. The terms of the agreement are set forth in the MOA, attached to the accompanying staff report as Attachment A.

SECTION 2. The City Council hereby approves the MOA between the City and the San Gabriel Valley Council of Governments to grant access of Measure H funding towards the city’s existing homeless programs to prevent and combat homelessness.

SECTION 3. The City Manager shall execute the MOA of behalf of the City, subject to modification and approval by the City Attorney’s Office.

SECTION 4. The City Clerk shall certify to the passage and adoption of this resolution.

PASSED, APPROVED AND ADOPTED this 28th day of June, 2022. _____________________________
Gloria Olmos, Mayor
ATTEST:
______________________________
Donna G. Schwartz, City Clerk

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:

CITY OF SOUTH EL MONTE )
I, Donna G. Schwartz, City Clerk of the City of South El Monte, do hereby certify that the foregoing Resolution, being Resolution No. 22-50 was passed and approved by the City Council of the City of South El Monte, at a regular meeting of said Council held on the 28th day of June, 2022 and that said Resolution was adopted by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
______________________________
Donna G. Schwartz, City Clerk

1679226.1

ATTACHMENT B

1679226.1

MEMORANDUM OF AGREEMENT

CITY HOMELESS PROGRAM MEMORANDUM OF AGREEMENT BETWEEN THE CITY

OF SOUTH EL MONTE AND THE SAN GABRIEL VALLEY COUNCIL OF

GOVERNMENTS (SGVCOG)
This Memorandum of Agreement (“MOA”) is by and between the City of South El Monte (City) and the San Gabriel Valley Council of Governments (SGVCOG) to be effective as of the date signed by both Parties.

RECITALS:

A. The SGVCOG was established to have a unified voice to maximize resources and advocate for regional and member interests to improve the quality of life in the San Gabriel Valley within the jurisdictions of its member cities and its unincorporated areas; B. The SGVCOG entered into a contract with the County of Los Angeles for Measure H funding for the purposes of providing homeless services in support of the County's Homeless Initiative (HI) strategies to combat homelessness in the San Gabriel Valley; C. The SGVCOG allocated Measure H funding to support four (4) programs, as approved by the SGVCOG Governing Board, to address homelessness in the San Gabriel Valley which included services to supplement existing homelessness programs, outreach and services for hard-to-reach populations, mobile crisis response program, and pilot programs; D. The City intends to implement a jurisdiction-specific SGVCOG’s Services to Supplement Existing Homeless Services Program (the “Program”) to serve its residents; and E. The City and the SGVCOG desire to set forth the terms of their ongoing collaboration with respect to this effort in this MOA.

NOW, THEREFORE, the Parties agree to the following:

I. TERM:

The term of this MOA shall commence upon execution of the MOA by all Parties and shall continue through May 31, 2023, or through the date upon which all eligible expenditures have been reimbursed, whichever occurs first. The term of this MOA may be extended by mutual agreement of both Parties by way of an amendment to this MOA.

II. RESPONSIBILITIES OF EACH OF THE PARTIES:

A. SGVCOG

1. Review submitted deliverables, reports, and invoices from the City and notify City as to any additional such documents that are required.

2. Coordinate conference calls and/or meetings with City as necessary.

1679226.1

3. Provide any updated point-of-contact described in Section III.B to serve as the SGVCOG’s Project Manager with name, title, and contact information.

4. Review and approve procurement procedures for City’s use of funds.

5. Hold monthly working group meetings with City to support information sharing.

6. Review City invoicing and reporting schedules and deadlines.

7. Provide payment to the City within thirty (30) days of approval of City’s invoice.

8. Reimburse the City up to $50,000.00 for eligible expenses as described in Exhibit B.

B. City

1. Manage the program, as described in Exhibit A.

2. Submit timely deliverables, reports, and invoices, including spend down reports and appropriate backup documentation in a form reasonably approved by the SGVCOG.

3. Respond to SGVCOG requests related to the Program in a timely manner.

4. Maintain membership in the SGVCOG during the entire term of this MOA.

5. Participate in monthly homeless working group meetings.

6. Provide any updated point-of-contact described in Section III.B to serve as the City’s Project Manager with name, title, and contact information.

7. Submit procurement procedures for City's use of funds under this MOA for approval by the SGVCOG. Procure and administer contracts funded by the SGVCOG in accordance with the SGVCOG-approved procurement procedures.

8. Prior to performance of any work by third-party vendors for which the City will seek reimbursement, submit the final form of contracts or purchase orders executed with third-party vendors to the SGVCOG for authorization. SGVCOG shall have no obligation to reimburse City for contracts and purchase orders that do not receive its approval prior to performance of work and SGVCOG reserves the right to not reimburse work under contracts for which the approved procurement process is not followed or have not received the SGVCOG’s prior approval.

9. Submit rates for City-employed staff for SGVCOG approval prior to City staff performing work for which the City will seek reimbursement. SGVCOG reserves the right to not reimburse staff time if rates are not submitted to the SGVCOG prior to performance of the work.

10. Notify SGVCOG prior to releasing press materials related to the Program.

11. Ensure that the Program works in coordination with other existing City programs.

12. Ensure that all funding is expended by the end of the MOA term and, if not, inform the SGVCOG as soon as practicable of delays in expending funds. The SGVCOG reserves the right to retain any funds that it deems will not be spent in accordance with this MOA by the MOA deadline.

13. Reimburse the SGVCOG for expenditures that are determined to be ineligible expenses, as outlined in Section III, and/or that are not in compliance with Measure H funding requirements.

14. Return all equipment purchased using funds secured through the MOA to SGVCOG upon the expiration or earlier termination of the MOA. City shall, at its sole expense, return the equipment in the same condition and appearance as when purchased by City (reasonable wear and tear excepted) and in good working order for the original intended purpose of the equipment.

1679226.1
III. INELIGIBLE EXPENSES
A. Work otherwise budgeted and funded by another source.

B. Work not completed during the term of the MOA, including work performed prior to the effective date of this MOA.

C. Advocacy and lobbying.

D. Grant preparation.

E. Participation in SGVCOG and/or other regional meetings.

F. Activities not defined in Exhibit A.

IV. INVOICING
A. City must submit invoices on a quarterly basis, no later than the tenth (10th) day of the month following the end of each quarter, in accordance with the schedule in Exhibit B.

City must provide all necessary documentation, including but not limited to timesheets, invoices, and deliverables, as support for the invoice. Invoice must include all work completed during the previous quarter. City’s final invoice for any eligible expenses not previously invoiced in the last quarterly invoice, shall be submitted within thirty (30) days of the end of the MOA term.

B. City must submit a quarterly report with the invoice indicating outcomes during the invoicing period.

C. Any late-submitted invoices are subject to a five percent (5%) penalty for each month for which the invoice is late. If an invoice is more than three (3) months late, the penalty will increase to ten percent (10%) per month. Penalties will be deducted from payments made by the SGVCOG on the invoices.

D. Any funds that are not expended by the end of the MOA term and invoiced within thirty (30) days thereof, may be retained by the SGVCOG for re-allocation to another program.

V. AMENDMENTS:

A. For any change which affects the scope of work, term, MOA, overall compensation, payments, or any term or condition included under this MOA, an amendment to the MOA shall be prepared and executed by the City and by the SGVCOG.

B. For any change which does not materially affect the statement of work as described in Exhibit “A”, the City must receive prior approval by the SGVCOG’s Project Manager.

VI. PROJECT MANAGEMENT:

A. For purposes of this MOA, the SGVCOG designates the following individual as its Project Manager to which any notices required under this MOA shall be sent:

Victoria Urenia
SGVCOG Management Analyst
San Gabriel Valley Council of Governments
1000 S. Fremont Ave, Unit 42

1679226.1
Bldg. A10-N, Suite 10210
Alhambra, CA 91803
626.457.1800
[email protected]
B. For purposes of this MOA, the City of South El Monte designates the following individual as its Project Manager to which any notices required under this MOA shall be sent:

Rene Salas
Deputy City Manager
City of South El Monte
1415 Santa Anita Avenue
South El Monte, CA 91733
626.579.6540 ext. 3040
[email protected]
C. Additional Parties’ contacts and copies of notices to whom shall be sent include the following individuals:

Marisa Creter
Executive Director
San Gabriel Valley Council of Governments
1000 S. Fremont Avenue, Unit 42
Bldg. A10-N, Suite 10210
Alhambra, CA 91803
[email protected]
D. Either Party may change its Project Manager or contacts upon written notice to the other Party.

VII. TERMINATION:

A. This MOA may be terminated by either Party at any time without cause. Termination will occur thirty (30) days after written notice is issued by a Party to the other Party’s Project Manager. The City shall stop work and not incur any additional expenses upon receipt of or issuance of such notice, except that which is reasonable and necessary to effectuate the termination. The City shall be entitled to reimbursement for eligible expenses that are reasonably and necessarily incurred up to the date that such termination is effective.

B. This MOA may be terminated for cause at any time for a material default by one of the Parties upon written notice to the applicable Project Manager. In the event of termination for cause, termination will be in effect three (3) days after deposit of the written notice in the U.S. Mail, postage pre-paid, unless otherwise stated at a later time in the written notice.

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VIII. INSURANCE AND INDEMNITY:

A. Neither the SGVCOG, its member agencies, or their respective officers, employees, consultants or volunteers (the “SGVCOG Indemnitees”), shall be responsible for any damage or liability occurring by reason of anything done or committed to be done by the City or its respective officers, agents, employees, or volunteers under or in connection with the performance of this MOA.

B. Neither the City or its respective officers, employees, consultants, or volunteers (the “City Indemnitees”), shall be responsible for any damage or liability occurring by reason of anything done or committed to be done by the SGVCOG Indemnitees under or in connection with the performance of this MOA C. The City shall indemnify, defend and hold the SGVCOG Indemnitees harmless from and against any liability, claims, losses, actions, and expenses, including without limitation, defense costs, any costs or liability on account of bodily injury, death or personal injury of any person or for damage to or loss of use of property, any legal fees and any claims for damages of any nature whatsoever arising out of or resulting from the City’s obligations under this MOA, unless caused by the negligence or willful misconduct of SGVCOG .

D. The SGVCOG shall indemnify, defend and hold the City Indemnitees harmless from and against any liability, claims, losses, actions, and expenses, including without limitation, defense costs, any costs or liability on account of bodily injury, death or personal injury of any person or for damage to or loss of use of property, any legal fees and any claims for damages of any nature whatsoever arising out of or resulting from the SGVCOG’s obligations under of this MOA, unless caused by the negligence or willful misconduct of the City .

IX. OTHER TERMS AND CONDITIONS:

A. In performing this MOA, neither the City nor SGVCOG is a contractor, agent or employee of the other. Neither the City or SGVCOG shall represent themselves as contractors, agents or employees of the other Party and shall have no powers to bind the other Party in contract or otherwise.

B. This MOA, along with the applicable funding requirements of the SGVCOG’s agreement with the County of Los Angeles, constitute the entire understanding between the Parties, with respect to the subject matter herein. The MOA shall not be amended except in writing signed by the Parties.

C. Neither Party hereto shall be considered in default in the performance of its obligations hereunder to the extent that the performance of any such obligation is prevented or delayed by unforeseen causes including acts of God, floods, earthquakes, fires, acts of a public enemy, pandemic, and government acts beyond

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the control and without fault or negligence of the affected Party. Each Party hereto shall give notice promptly to the other of the nature and extent of any such circumstances claimed to delay, hinder, or prevent performance of any obligations under this MOA.

D. Neither Party shall assign this MOA, or any part thereof, without the prior written consent and prior approval of the other Party, nor any assignment without consent shall be void and unenforceable.

E. This Agreement shall be governed by California law and any applicable federal law.

F. If any provision of this MOA is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.

G. The terms of this MOA shall inure to the benefit of, and shall be binding upon, each of the Parties and their respective approved successors and assigns. [Signature page to follow]

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In witness whereof, the Parties enter into this MOA on the date of last execution by the Parties.

FOR THE CITY OF SOUTH EL MONTE
By: ___________________________
Rachel Barbosa
City Manager
Date: __________________________
APPROVED AS TO FORM:
_______________________________
Anthony R. Taylor
City Attorney

FOR THE SAN GABRIEL VALLEY

COUNCIL OF GOVERNMENTS
By: ____________________________
Marisa Creter
Executive Director
Date: __________________________
APPROVED AS TO FORM:
_______________________________
David DeBerry
General Counsel

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EXHIBIT A
Scope of Work
City Program SOW: South El Monte
Scope of Services
This Program will provide additional housing navigation/case management support for persons experiencing homelessness (PEH) in the City of South El Monte by helping to fill existing gaps in the homeless services system. There will be a specific focus on connecting clients to housing and other necessary services to support housing stability through the provision of the following services:
 Street Outreach: Street outreach services will be designed to locate, identify, and engage in services for people who are unsheltered within the subregion. The goal for this service is to provide immediate support of basic needs, including, to the extent practicable, medical and mental healthcare, while continuing progressive engagement towards increased housing stability. Street outreach services will be provided in accordance with standards set forth in LAHSA’s Scope of Required Services for Street Outreach.  Housing Navigation: Housing Navigation services will be designed to prepare people experiencing homelessness who have been engaged through street outreach to enter interim or permanent housing through case management and support services.  Case Management: Case Management services will be designed to work collaboratively with participants to provide assessment, crisis intervention, and housing service planning.

Additional services will include referrals, linkages and care coordination with additional homeless and supportive service providers with an ultimate goal of achieving housing stability, preferably in a permanent housing resource.
 Homelessness Prevention and Problem Solving: Homelessness Prevention and Problem Solving Services will be designed to prevent residents from falling into homelessness and/or to divert individuals away from the system. The housing navigator will provide problem solving services focused on improving the current living situation or connecting the resident with more suitable housing that can be maintained.  Supportive Services (e.g., legal services, workforce development): As part of case management services, participants will be linked to additional supportive services which may include legal assistance, job placement and workforce development, basic needs assistance, childcare, transportation assistance and more.  Mental Health and Health Support: The housing navigator will help connect PEH in the City to mental health and psychiatric care, including referrals and linkages to mental health service providers and primary care medicine, care coordination with community-based providers, and, to the extent practicable, crisis intervention, referrals and linkages to mental health service providers, and psychotropic medication management. The goal of these services will be to help connect clients to deliver essential mental and physical healthcare services in the community with the goal of stabilization.  Direct Funding Resources (e.g., prevention, motel vouchers, etc.): Participants will benefit from motel vouchers and general assistance funds to support goals of stabilization.

Additionally, participants will benefit from multiple funding streams for a variety of

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purposes including but not limited to prevention/diversion, Rapid Rehousing rental assistance, general assistance, move-in costs for permanent housing, etc.

This program will provide unique services and a unique caseload of clients to supplement existing teams and resources in the City. This program will supplement but also coordinate with existing resources and services provided within the City, which include but are not limited to those provided by the Los Angeles Homeless Services Authority (LAHSA), Union Station Homeless Services (USHS), and through the Mid-Valley Collaborative on Homelessness (MVCH).

Through the implementation of the below-listed tasks, the City will meet the following metrics:

Metrics Quarterly Total
Unique clients served/outreached-to ~13 50
Clients receiving supportive/housing services and/or referred to housing navigation
~4 16
Clients referred to interim housing ~3 10
Clients linked/referred to permanent housing ~3 10
Clients exiting interim housing to permanent housing n/a 2 Clients receiving prevention/diversion services and/or diverted from homeless services system
5 20
The City will work with the SGVCOG to compile additional data demographics, including unique clients served versus clients continuously served, to develop an understanding of the population of PEH accessing services in the cities.

Task 1
The City will provide a 0.5 FTE housing navigator that provides the services described in the “Scope of Services” to a unique caseload of clients.

The City will ensure that the additional housing navigator works closely with existing teams and resources managed by/active in the City, including those provided through the MVCH, to ensure that the services are being provided to a unique caseload of clients. Upon request of the SGVCOG, the City shall provide data from existing teams and resources demonstrating that the clients being served through this Program are unique clients.

Deliverables:
● Quarterly report that includes a narrative on the successes and challenges of implementing the Program, demographics of the clients served, an overview of the specific services provided, outcomes towards meeting the key performance metrics as listed above, or, if the metrics are not being met, the challenges in meeting the metrics, coordination with existing programs, and outcomes after intervention, in the format provided by the SGVCOG. ● Clients report forms, or equivalent data, in a format approved by the SGVCOG ● Final report that includes a narrative on the successes and challenges of the Program, demographics on the clients served, an overview of the specific services provided, outcomes after intervention, and overall performance metrics, in the format provided by the SGVCOG.

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Basis of Billing: Time and Materials
The City must provide invoices, including timesheets, and receipts for payment.

Task 2
Administer the program funding.

Basis of Billing: Fixed Fee
The City will receive a fixed fee of five percent (5%) of each submitted invoice.

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EXHIBIT B
Table 1. Budget
The City shall receive a maximum of $50,000 for implementation of the City’s Program. Funding shall be disbursed on a reimbursement basis and in accordance with Table 1.

Reports and invoices must be submitted quarterly by the following dates:
2022 2023
October 10, 2022 January 10, 2023
April 10, 2023
The final report is due by June 13, 2023.

Task 1 Housing Navigation $ 47,500
Task 2 Project Administration (5%) $ 2,500
$ 50,000
Task Not to Exceed Amount

City Council Agenda Report
Agenda Item No. 9.d.

DATE: June 28, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Rachel Barbosa, City Manager
SUBMITTED BY: Colby Cataldi, Community Development Director SUBJECT: CONSIDERATION AND APPROVAL OF RESOLUTION NO. 22- 51, AWARDING A PROFESSIONAL SERVICES AGREEMENT
(PSA) TO SAN GABRIEL VALLEY-HABITAT FOR HUMANITY
TO ADMINISTER AND IMPLEMENT THE CALHOME OWNEROCCUPIED HOME REPAIR PROGRAM SUMMARY: Staff seeks City Council approval to award a Professional Services Agreement (PSA) to San Gabriel Valley-Habitat for Humanity as the responsive, responsible bidder to administer and implement the CalHome Owner-Occupied Home Repair Program.

RECOMMENDED ACTION: Staff recommends City Council adopt Resolution No. 22- 51, awarding a professional services agreement to San Gabriel Valley-Habitat for Humanity to administer and implement the CalHome Home Repair Program for the amount not-to-exceed (NTE) 10% of the grant amount or $100,000.00.

FISCAL IMPACT: No fiscal impact on the General Fund. The contractor is being funded through CalHome grant funds, which is a Special Revenue Fund eligible for full reimbursement.

DISCUSSION: In the Spring of 2021, the City was notified the 2020 Notice of Funding Availability (NOFA) was being awarded $1,000,000.00 for the CalHome Owner-Occupied Home Repair program from the California Department of Housing and Community Development (HCD). The program provides financial assistance to qualified individual homeowners in the form of deferred payment loans, repayable upon the sale or transfer of the homes, when the home ceases to be owner-occupied, or upon the loan maturity date, whichever occurs first (HSC§ 50650.3(c)(1)). The Loan shall be up to a 30-year term (Guidelines Section 7726, subd. (c)(5-6)). The standard agreement was not executed until January 2022, with an effective date commencing on January 18, 2022 through May 25, 2025.

On March 22, 2022, the City issued a Request for Qualifications (RFQ) to establish a

prequalified list of firms for grant program administration and select a firm to administer and implement the CalHome Owner-Occupied Home Repair program with a proposal due date of May 12, 2022. Two (2) firms submitted proposals: Neighborhood Housing Services of Los Angeles County (NHSLA) and San Gabriel Valley-Habitat for Humanity.

The proposals were evaluated based on the established criteria identified in the RFQ including compliance with the requirements, project understanding, experience, responsiveness and flexibility, experience of assigned staff, schedule efficiency, and references.

Staff reviewed the proposals and determined that the proposal from San Gabriel ValleyHabitat for Humanity was the most responsive, responsible bidder. Their proposal was the most comprehensive and demonstrated the best understanding of the project. San Gabriel Valley-Habitat for Humanity showed in its proposal their related project experience of similar projects within the San Gabriel Valley. The proposed project manager and proposed team also demonstrated required qualifications and experience providing similar services to the referenced projects.

Staff recommends that the City Council approve a professional services agreement with San Gabriel Valley-Habitat for Humanity, as the most responsive, responsible bidder, to administer and implement the CalHome Owner-Occupied Home Repair program for a total amount not-to-exceed (NTE) 10% of the grant amount or $100,000.00 and authorize the City Manager to execute the agreement.

ATTACHMENT(S):

A. Resolution No. 22-51
B. Proposal for Services
C. Draft Professional Services Agreement

ATTACHMENT A

RESOLUTION NO. 22-51

A RESOLUTION OF THE SOUTH EL MONTE CITY COUNCIL

AWARDING PROFESSIONAL SERVICE AGREEMENT TO

SAN GABRIEL VALLEY-HABITAT FOR HUMANITY TO

ADMINISTER AND IMPLEMENT THE CALHOME HOME

REPAIR PROGRAM
WHEREAS, in October of 2020, the City, submitted grant funding request to the State, for CalHome funding; and
WHEREAS, in Spring of 2021, the City was notified the 2020 Notice of Funding Availability (NOFA) was being awarded $1,000,000 for the CalHome owner-occupied home repair program from the California Department of Housing and Community Development (HCD); and
WHEREAS, on March 22, 2022, the City Council authorized staff to issue a Request for Qualifications (RFQ) establish a prequalified list of firms for grant program administration and select a firm to administer and implement the CalHome Owner-Occupied Home Repair program; and
WHEREAS, on May 12, 2022, the City received two (2) proposals for the solicited services;
WHEREAS, the City staff evaluated the proposals and determined that San Gabriel Valley-Habitat for Humanity submitted the most qualified and comprehensive proposal to provide the subject services for the project;
WHEREAS, the City staff determined that San Gabriel Valley-Habitat for Humanity was the most responsive bidder for the project;

NOW, THEREFORE, THE SOUTH EL MONTE CITY COUNCIL HEREBY RESOLVES AS FOLLOWS:

SECTION 1. The above recitals are true and correct and incorporated by reference.

SECTION 2. Upon reviewing the proposals submitted to establish a prequalified list of firms for grant program administration and select a firm to administer and implement the CalHome Owner-Occupied Home Repair program, the City Council hereby finds that San Gabriel ValleyHabitat for Humanity has submitted the most qualified proposal, in the amount not-to-exceed (NTE) 10% of the grant amount or $100,000.

SECTION 3. The City Council hereby authorizes the City Manager or designee to execute a professional service agreement with San Gabriel Valley-Habitat for Humanity in the amount notto-exceed (NTE) 10% of the grant amount or $100,000. The City Attorney may amend the

agreement as to form. The Council further directs the City Manager to take all actions necessary to effectuate the agreement.

SECTION 4. The City Clerk shall certify to the passage and adoption of this resolution.

PASSED, APPROVED and ADOPTED this 28th day of June, 2022. _____________________________
Gloria Olmos, Mayor
ATTEST:
_____________________________
Donna G. Schwartz, City Clerk

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:

CITY OF SOUTH EL MONTE )
I, Donna G. Schwartz, City Clerk of the City of South El Monte, do hereby certify that the foregoing Resolution, being Resolution No. 22-51 was passed and approved by the City Council of the City of South El Monte at a Regular meeting of said Council held on the 28th day of June, 2022, and that said Resolution was adopted by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Donna G. Schwartz, City Clerk

ATTACHMENT B

01257.0001/695510.1 1

ATTACHMENT C

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AGREEMENT FOR CONTRACT SERVICES

BETWEEN THE CITY OF SOUTH EL MONTE AND

SAN GABRIEL VALLEY-HABITAT FOR HUMANITY
THIS CONTRACT SERVICES AGREEMENT (herein “Agreement”) is made and entered into this ____ day of _______, 2022, by and between the CITY OF SOUTH EL MONTE, a municipal corporation (“City”) and San Gabriel Valley-Habitat for Humanity (herein “Consultant”).

NOW, THEREFORE, the parties hereto agree as follows:

1. SERVICES OF CONSULTANT

1.1 Scope of Services. In compliance with all of the terms and conditions of this Agreement, the Consultant shall perform the work or services set forth in the “Scope of Services” attached hereto as Exhibit “A” and incorporated herein by reference. Consultant warrants that it has the experience and ability to perform all work and services required hereunder and that it shall diligently perform such work and services in a professional and satisfactory manner.

1.2 Compliance With Law. All work and services rendered hereunder shall be provided in accordance with all ordinances, resolutions, statutes, rules, and regulations of the City and any Federal, State or local governmental agency of competent jurisdiction.

1.3 California Labor Law. If the Scope of Services includes any “public work” or “maintenance work,” as those terms are defined in California Labor Code section 1720 et seq. and California Code of Regulations, Title 8, Section 16000 et seq., and if the total compensation is $1,000 or more, Consultant shall pay prevailing wages for such work and comply with the requirements in California Labor Code section 1770 et seq. and 1810 et seq., and all other applicable laws.

1.4 Licenses, Permits, Fees and Assessments. Consultant shall obtain at its sole cost and expense such licenses, permits, and approvals as may be required by law for the performance of the services required by the Agreement.

1.5 Special Requirements. Additional terms and conditions of this Agreement, if any, which are made a part hereof are set forth in the “Special Requirements” attached hereto as Exhibit “B” and incorporated herein by this reference. In the event of a conflict between the provisions of Exhibit “B” and any other provisions of this Agreement, the provisions of Exhibit “B” shall govern.

2. COMPENSATION

2.1 Contract Sum. For the services rendered pursuant to this Agreement, Consultant shall be compensated in accordance with the “Schedule of Compensation” attached hereto as Exhibit “C” and incorporated herein by this reference, but not exceeding the maximum contract amount of One Hundred Thousand Dollars ($100,000) or 10% of the CalHome grant fund (“Contract Sum”).

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2.2 Invoices. Each month Consultant shall furnish to City an original invoice for all work performed and expenses incurred during the preceding month in a form approved by City’s Director of Finance. By submitting an invoice for payment under this Agreement, Consultant is certifying compliance with all provisions of the Agreement. The invoice shall contain all information specified in Exhibit “C”, and shall detail charges for all necessary and actual expenses by the following categories: labor (by sub-category), travel, materials, equipment, supplies, and sub-contractor contracts. Sub-contractor charges shall also be detailed by such categories. Consultant shall not invoice City for any duplicate services performed by more than one person.

City shall independently review each invoice submitted by the Consultant to determine whether the work performed and expenses incurred are in compliance with the provisions of this Agreement. Except as to any charges for work performed or expenses incurred by Consultant which are disputed by City, City will use its best efforts to cause Consultant to be paid within forty-five (45) days of receipt of Consultant’s correct and undisputed invoice; however, Consultant acknowledges and agrees that due to City warrant run procedures, the City cannot guarantee that payment will occur within this time period. In the event any charges or expenses are disputed by City, the original invoice shall be returned by City to Consultant for correction and resubmission.

Review and payment by the City of any invoice provided by the Consultant shall not constitute a waiver of any rights or remedies provided herein or any applicable law.

2.3 Additional Services. City shall have the right at any time during the performance of the services, without invalidating this Agreement, to order extra work beyond that specified in the Scope of Services or make changes by altering, adding to or deducting from said work. No such extra work may be undertaken unless a written order is first given by the Contract Officer to the Consultant, incorporating therein any adjustment in (i) the Contract Sum for the actual cost of the extra work, and/or (ii) the time to perform this Agreement, which said adjustments are subject to the written approval of the Consultant. Any increase in compensation of up to ten percent (10%) of the Contract Sum but not exceeding a total contract amount of Five Thousand Dollars ($5,000) or in the time to perform of up to ninety (90) days may be approved by the Contract Officer. Any greater increases, taken either separately or cumulatively, must be approved by the City Council. No claim for an increase in the Contract Sum or time for performance shall be valid unless the procedures established in this Section are followed.

3. PERFORMANCE SCHEDULE

3.1 Time of Essence. Time is of the essence in the performance of this Agreement.

3.2 Schedule of Performance. Consultant shall commence the services pursuant to this Agreement upon receipt of a written notice to proceed and shall perform all services within the time period(s) established in the “Schedule of Performance” attached hereto as Exhibit “D” and incorporated herein by this reference. When requested by the Consultant, extensions to the time period(s) specified in the Schedule of Performance may be approved in writing by the Contract Officer but not exceeding thirty (30) days cumulatively.

3.3 Force Majeure. The time period(s) specified in the Schedule of Performance for performance of the services rendered pursuant to this Agreement shall be extended because of any delays due to unforeseeable causes beyond the control and without the

4 01257.0001/695510.1
fault or negligence of the Consultant, including, but not restricted to, acts of God or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the City, if the Consultant shall within ten (10) days of the commencement of such delay notify the Contract Officer in writing of the causes of the delay. The Contract Officer shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the Contract Officer such delay is justified. The Contract Officer’s determination shall be final and conclusive upon the parties to this Agreement. In no event shall Consultant be entitled to recover damages against the City for any delay in the performance of this Agreement, however caused, Consultant’s sole remedy being extension of the Agreement pursuant to this Section.

3.4 Term. Unless earlier terminated in accordance with Article 7 of this Agreement, this Agreement shall continue in full force and effect until completion of the services but not exceeding three years from the date hereof, except as otherwise provided in the Schedule of Performance (Exhibit “D”). [The City may, in its sole discretion, extend the Term for two additional one-year terms.]

4. COORDINATION OF WORK

4.1 Representative of Consultant. Laura Ealy, Director of Programs is hereby designated as being the representative of Consultant authorized to act on its behalf with respect to the work and services specified herein and make all decisions in connection therewith. All personnel of Consultant and any authorized agents shall be under the exclusive direction of the representative of Consultant. Consultant shall utilize only competent personnel to perform services pursuant to this Agreement. Consultant shall make every reasonable effort to maintain the stability and continuity of Consultant’s staff and subcontractors, and shall keep City informed of any changes.

4.2 Contract Officer. Colby Cataldi, Director of Community Development [or such person as may be designated by the City Manager] is hereby designated as being the representative the City authorized to act in its behalf with respect to the work and services specified herein and to make all decisions in connection therewith (“Contract Officer”).

4.3 Prohibition Against Subcontracting or Assignment. Consultant shall not contract with any entity to perform in whole or in part the work or services required hereunder without the express written approval of the City. Neither this Agreement nor any interest herein may be assigned or transferred, voluntarily or by operation of law, without the prior written approval of City. Any such prohibited assignment or transfer shall be void.

4.4 Independent Consultant. Neither the City nor any of its employees shall have any control over the manner, mode or means by which Consultant, its agents or employees, perform the services required herein, except as otherwise set forth. Consultant shall perform all services required herein as an independent contractor of City with only such obligations as are consistent with that role. Consultant shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City, or that it is a member of a joint enterprise with City. Consultant represents and warrants that the personnel used to provide services to the City pursuant to this Agreement are classified by Consultant as employees and that Consultant issues or will issue a W-2 to such personnel.

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In the event that Consultant or any employee, agent, subcontractor, or independent contractor of Consultant providing services under this Agreement claims or is determined by a federal or state agency, a court of competent jurisdiction, or the California Public Employees’ Retirement System (“CalPERS”) to be classified as other than an independent contractor for the City, then Consultant shall indemnify, defend, and hold harmless the City for the payment of any and all assessed fines, penalties, judgments, employee and/or employer contributions, and any other damages and costs assessed to the City as a consequence of, or in any way attributable to, the assertion that Consultant or any of Consultant’s personnel used to provide the Services under this Agreement are other than independent contractors of the City.

5. INSURANCE AND INDEMNIFICATION

5.1 Insurance Coverages. Without limiting Consultant’s indemnification of City, and prior to commencement of any services under this Agreement, Consultant shall obtain, provide and maintain at its own expense during the term of this Agreement, policies of insurance of the type and amounts described below and in a form satisfactory to City. (a) General liability insurance. Consultant shall maintain commercial general liability insurance with coverage at least as broad as Insurance Services Office form CG 00 01, in an amount not less than $1,000,000 per occurrence, $2,000,000 general aggregate, for bodily injury, personal injury, and property damage. The policy must include contractual liability that has not been amended. Any endorsement restricting standard ISO “insured contract” language will not be accepted.
(b) Automobile liability insurance. Consultant shall maintain automobile insurance at least as broad as Insurance Services Office form CA 00 01 covering bodily injury and property damage for all activities of the Consultant arising out of or in connection with Services to be performed under this Agreement, including coverage for any owned, hired, non-owned or rented vehicles, in an amount not less than $1,000,000 combined single limit for each accident. (c) Professional liability (errors & omissions) insurance. Consultant shall maintain professional liability insurance that covers the Services to be performed in connection with this Agreement, in the minimum amount of $1,000,000 per claim and in the aggregate. Any policy inception date, continuity date, or retroactive date must be before the effective date of this Agreement and Consultant agrees to maintain continuous coverage through a period no less than three (3) years after completion of the services required by this Agreement. (d) Workers’ compensation insurance. Consultant shall maintain Workers’ Compensation Insurance (Statutory Limits) and Employer’s Liability Insurance (with limits of at least $1,000,000).
(e) Subcontractors. Consultant shall include all subcontractors as insureds under its policies or shall furnish separate certificates and certified endorsements for each subcontractor. All coverages for subcontractors shall include all of the requirements stated herein. (f) Additional Insurance. Policies of such other insurance, as may be required in the Special Requirements in Exhibit “B”.

5.2 General Insurance Requirements.

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(a) Proof of insurance. Consultant shall provide certificates of insurance to City as evidence of the insurance coverage required herein, along with a waiver of subrogation endorsement for workers’ compensation. Insurance certificates and endorsements must be approved by City’s Risk Manager prior to commencement of performance. Current certification of insurance shall be kept on file with City at all times during the term of this Agreement. City reserves the right to require complete, certified copies of all required insurance policies, at any time.
(b) Duration of coverage. Consultant shall procure and maintain for the duration of this Agreement insurance against claims for injuries to persons or damages to property, which may arise from or in connection with the performance of the Services hereunder by Consultant, its agents, representatives, employees or subconsultants. (c) Primary/noncontributing. Coverage provided by Consultant shall be primary and any insurance or self-insurance procured or maintained by City shall not be required to contribute with it. The limits of insurance required herein may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of City before the City’s own insurance or self-insurance shall be called upon to protect it as a named insured.
(d) City’s rights of enforcement. In the event any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced, City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant or City will withhold amounts sufficient to pay premium from Consultant payments. In the alternative, City may cancel this Agreement. (e) Acceptable insurers. All insurance policies shall be issued by an insurance company currently authorized by the Insurance Commissioner to transact business of insurance or that is on the List of Approved Surplus Line Insurers in the State of California, with an assigned policyholders’ Rating of A- (or higher) and Financial Size Category Class VI (or larger) in accordance with the latest edition of Best’s Key Rating Guide, unless otherwise approved by the City’s Risk Manager.
(f) Waiver of subrogation. All insurance coverage maintained or procured pursuant to this agreement shall be endorsed to waive subrogation against City, its elected or appointed officers, agents, officials, employees and volunteers or shall specifically allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against City, and shall require similar written express waivers and insurance clauses from each of its subconsultants.
(g) Enforcement of contract provisions (non-estoppel). Consultant acknowledges and agrees that any actual or alleged failure on the part of the City to inform Consultant of non-compliance with any requirement imposes no additional obligations on the City nor does it waive any rights hereunder.
(h) Requirements not limiting. Requirements of specific coverage features or limits contained in this section are not intended as a limitation on coverage, limits or other

7 01257.0001/695510.1
requirements, or a waiver of any coverage normally provided by any insurance. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue and is not intended by any party or insured to be all inclusive, or to the exclusion of other coverage, or a waiver of any type. If the Consultant maintains higher limits than the minimums shown above, the City requires and shall be entitled to coverage for the higher limits maintained by the Consultant. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City.
(i) Notice of cancellation. Consultant agrees to oblige its insurance agent or broker and insurers to provide to City with a thirty (30) day notice of cancellation (except for nonpayment for which a ten (10) day notice is required) or nonrenewal of coverage for each required coverage.
(j) Additional insured status. General liability policies shall provide or be endorsed to provide that City and its officers, officials, employees, and agents, and volunteers shall be additional insureds under such policies. This provision shall also apply to any excess/umbrella liability policies.
(k) Prohibition of undisclosed coverage limitations. None of the coverages required herein will be in compliance with these requirements if they include any limiting endorsement of any kind that has not been first submitted to City and approved of in writing. (l) Separation of insureds. A severability of interests provision must apply for all additional insureds ensuring that Consultant’s insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the insurer’s limits of liability. The policy(ies) shall not contain any cross-liability exclusions. (m) Pass through clause. Consultant agrees to ensure that its subconsultants, subcontractors, and any other party involved with the project who is brought onto or involved in the project by Consultant, provide the same minimum insurance coverage and endorsements required of Consultant. Consultant agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. Consultant agrees that upon request, all agreements with consultants, subcontractors, and others engaged in the project will be submitted to City for review. (n) Agency’s right to revise specifications. The City reserves the right at any time during the term of the contract to change the amounts and types of insurance required by giving the Consultant ninety (90) days advance written notice of such change. If such change results in substantial additional cost to the Consultant, the City and Consultant may renegotiate Consultant’s compensation.
(o) Self-insured retentions. Any self-insured retentions must be declared to and approved by City. City reserves the right to require that self-insured retentions be eliminated, lowered, or replaced by a deductible. Self-insurance will not be considered to comply with these specifications unless approved by City.
(p) Timely notice of claims. Consultant shall give City prompt and timely notice of claims made or suits instituted that arise out of or result from Consultant’s performance

8 01257.0001/695510.1
under this Agreement, and that involve or may involve coverage under any of the required liability policies.
(q) Additional insurance. Consultant shall also procure and maintain, at its own cost and expense, any additional kinds of insurance, which in its own judgment may be necessary for its proper protection and prosecution of the work.

5.3 Indemnification. To the full extent permitted by law, Consultant agrees to indemnify, defend and hold harmless the City, its officers, employees and agents (“Indemnified Parties”) against, and will hold and save them and each of them harmless from, any and all actions, either judicial, administrative, arbitration or regulatory claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities whether actual or threatened (herein “claims or liabilities”) that may be asserted or claimed by any person, firm or entity arising out of or in connection with the negligent performance of the work, operations or activities provided herein of Consultant, its officers, employees, agents, subcontractors, invitees, or any individual or entity for which Consultant is legally liable (“indemnitors”), or arising from Consultant’s or indemnitors’ reckless or willful misconduct, or arising from Consultant’s or indemnitors’ negligent performance of or failure to perform any term, provision, covenant or condition of this Agreement, except claims or liabilities occurring as a result of City’s sole negligence or willful acts or omissions. The indemnity obligation shall be binding on successors and assigns of Consultant and shall survive termination or expiration of this Agreement.

6. RECORDS, REPORTS, AND RELEASE OF INFORMATION

6.1 Records. Consultant shall keep, and require subcontractors to keep, such ledgers, books of accounts, invoices, vouchers, canceled checks, reports, studies or other documents relating to the disbursements charged to City and services performed hereunder (the “books and records”), as shall be necessary to perform the services required by this Agreement and enable the Contract Officer to evaluate the performance of such services and shall keep such records for a period of three years following completion of the services hereunder. The Contract Officer shall have full and free access to such books and records at all times during normal business hours of City, including the right to inspect, copy, audit and make records and transcripts from such records.

6.2 Reports. Consultant shall periodically prepare and submit to the Contract Officer such reports concerning the performance of the services required by this Agreement or as the Contract Officer shall require.

6.3 Confidentiality and Release of Information.
(a) All information gained, or work product produced by Consultant in performance of this Agreement shall be considered confidential, unless such information is in the public domain or already known to Consultant. Consultant shall not release or disclose any such information or work product to persons or entities other than the City without prior written authorization from the Contract Officer.
(b) Consultant shall not, without prior written authorization from the Contract Officer or unless requested by the City Attorney, voluntarily provide documents, declarations, letters of support, testimony at depositions, response to interrogatories or other information

9 01257.0001/695510.1
concerning the work performed under this Agreement. Response to a subpoena or court order shall not be considered “voluntary” provided Consultant gives the City notice of such court order or subpoena.
(c) If Consultant provides any information or work product in violation of this Agreement, then the City shall have the right to reimbursement and indemnity from Consultant for any damages, costs and fees, including attorney’s fees, caused by or incurred as a result of Consultant’s conduct.
(d) Consultant shall promptly notify the City should Consultant be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed thereunder. The City retains the right, but has no obligation, to represent Consultant or be present at any deposition, hearing or similar proceeding. Consultant agrees to cooperate fully with the City and to provide the City with the opportunity to review any response to discovery requests provided by Consultant.

6.4 Ownership of Documents. All studies, surveys, data, notes, computer files, reports, records, drawings, specifications, maps, designs, photographs, documents and other materials (the “documents and materials”) prepared by Consultant in the performance of this Agreement shall be the property of the City and shall be delivered to the City upon request of the Contract Officer or upon the termination of this Agreement, and Consultant shall have no claim for further employment or additional compensation as a result of the exercise by the City of its full rights of ownership use, reuse, or assignment of the documents and materials hereunder. Moreover, Consultant with respect to any documents and materials that may qualify as “works made for hire” as defined in 17 U.S.C. § 101, such documents and materials are hereby deemed “works made for hire” for the City.

7. ENFORCEMENT OF AGREEMENT AND TERMINATION

7.1 California Law. This Agreement shall be interpreted, construed and governed both as to validity and to performance of the parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California. In the event of litigation in a U.S. District Court, venue shall lie exclusively in the Central District of California, in the County of Los Angeles, State of California.

7.2 Disputes; Default. In the event that Consultant is in default under the terms of this Agreement, the City shall not have any obligation or duty to continue compensating Consultant for any work performed after the date of default. Instead, the City may give notice to Consultant of the default and the reasons for the default. The notice shall include the timeframe in which Consultant may cure the default. This timeframe is presumptively thirty (30) days, but may be extended, if circumstances warrant. During the period of time that Consultant is in default, the City shall hold all invoices and shall, when the default is cured, proceed with payment on the invoices. If Consultant does not cure the default, the City may take necessary steps to terminate this Agreement under this Article.

7.3 Legal Action. In addition to any other rights or remedies, either party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages

10 01257.0001/695510.1
for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.

Notwithstanding any contrary provision herein, Consultant shall file a statutory claim pursuant to Government Code Sections 905 et. seq. and 910 et. seq., in order to pursue any legal action under this Agreement.

Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party.

7.4 Termination Prior to Expiration of Term. This Section shall govern any termination of this Contract except as specifically provided in the following Section for termination for cause. The City reserves the right to terminate this Contract at any time, with or without cause, upon thirty (30) days’ written notice to Consultant, except that where termination is due to the fault of the Consultant, the period of notice may be such shorter time as may be determined by the Contract Officer. In addition, the Consultant reserves the right to terminate this Contract at any time, with or without cause, upon sixty (60) days’ written notice to City, except that where termination is due to the fault of the City, the period of notice may be such shorter time as the Consultant may determine. Upon receipt of any notice of termination, Consultant shall immediately cease all services hereunder except such as may be specifically approved by the Contract Officer. Except where the Consultant has initiated termination, the Consultant shall be entitled to compensation for all services rendered prior to the effective date of the notice of termination and for any services authorized by the Contract Officer thereafter in accordance with the Schedule of Compensation or such as may be approved by the Contract Officer. In the event the Consultant has initiated termination, the Consultant shall be entitled to compensation only for the reasonable value of the work product actually produced hereunder, but not exceeding the compensation provided therefore in the Schedule of Compensation Exhibit “C”. In the event of termination without cause pursuant to this Section, the terminating party need not provide the nonterminating party with the opportunity to cure pursuant to Section 7.2.

7.5 Termination for Default of Consultant. If termination is due to the failure of the Consultant to fulfill its obligations under this Agreement, City may, after compliance with the provisions of Section 7.2, take over the work and prosecute the same to completion by contract or otherwise, and the Consultant shall be liable to the extent that the total cost for completion of the services required hereunder exceeds the compensation herein stipulated (provided that the City shall use reasonable efforts to mitigate such damages), and City may withhold any payments to the Consultant for the purpose of set-off or partial payment of the amounts owed the City as previously stated.

8. MISCELLANEOUS

8.1 Covenant Against Discrimination. Consultant covenants that, by and for itself, its heirs, executors, assigns and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, gender, sexual orientation, marital status, national origin, ancestry, or other protected class in the performance of this Agreement. Consultant shall take affirmative action

11 01257.0001/695510.1
to ensure that applicants are employed and that employees are treated during employment without regard to their race, color, creed, religion, sex, gender, sexual orientation, marital status, national origin, ancestry, or other protected class

8.2 Non-liability of City Officers and Employees. No officer or employee of the City shall be personally liable to the Consultant, or any successor in interest, in the event of any default or breach by the City or for any amount, which may become due to the Consultant or to its successor, or for breach of any obligation of the terms of this Agreement.

8.3 Notice. Any notice, demand, request, document, consent, approval, or communication either party desires or is required to give to the other party or any other person shall be in writing and either served personally or sent by prepaid, first-class mail, in the case of the City, to the City Manager and to the attention of the Contract Officer (with her/his name and City title), City of South El Monte, 6330 Pine Avenue, South El Monte, California 90201, and in the case of the Consultant, to the person(s) at the address designated on the execution page of this Agreement. Either party may change its address by notifying the other party of the change of address in writing. Notice shall be deemed communicated at the time personally delivered or in seventy-two (72) hours from the time of mailing if mailed as provided in this Section.

8.4 Integration; Amendment. It is understood that there are no oral agreements between the parties hereto affecting this Agreement and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements and understandings, if any, between the parties, and none shall be used to interpret this Agreement. This Agreement may be amended at any time by the mutual consent of the parties by an instrument in writing.

8.5 Severability. In the event that part of this Agreement shall be declared invalid or unenforceable by a valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining portions of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the parties hereunder unless the invalid provision is so material that its invalidity deprives either party of the basic benefit of their bargain or renders this Agreement meaningless.

8.6 Waiver. No delay or omission in the exercise of any right or remedy by non-defaulting party on any default shall impair such right or remedy or be construed as a waiver.

A party’s consent to or approval of any act by the other party requiring the party’s consent or approval shall not be deemed to waive or render unnecessary the other party’s consent to or approval of any subsequent act. Any waiver by either party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.

8.7 Attorneys’ Fees. If either party to this Agreement is required to initiate or defend or made a party to any action or proceeding in any way connected with this Agreement, the prevailing party in such action or proceeding, in addition to any other relief which any be granted, whether legal or equitable, shall be entitled to reasonable attorney’s fees, whether or not the matter proceeds to judgment.

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8.8 Interpretation.

The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply.

8.9 Counterparts.

This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and such counterparts shall constitute one and the same instrument.

8.10 Warranty & Representation of Non-Collusion. No official, officer, or employee of City has any financial interest, direct or indirect, in this Agreement, nor shall any official, officer, or employee of City participate in any decision relating to this Agreement which may affect his/her financial interest or the financial interest of any corporation, partnership, or association in which (s)he is directly or indirectly interested, or in violation of any corporation, partnership, or association in which (s)he is directly or indirectly interested, or in violation of any State or municipal statute or regulation. The determination of “financial interest” shall be consistent with State law and shall not include interests found to be “remote” or “noninterests” pursuant to Government Code Sections 1091 or 1091.5. Consultant warrants and represents that it has not paid or given, and will not pay or give, to any third party including, but not limited to, any City official, officer, or employee, any money, consideration, or other thing of value as a result or consequence of obtaining or being awarded any agreement. Consultant further warrants and represents that (s)he/it has not engaged in any act(s), omission(s), or other conduct or collusion that would result in the payment of any money, consideration, or other thing of value to any third party including, but not limited to, any City official, officer, or employee, as a result of consequence of obtaining or being awarded any agreement. Consultant is aware of and understands that any such act(s), omission(s) or other conduct resulting in such payment of money, consideration, or other thing of value will render this Agreement void and of no force or effect.

Consultant’s Authorized Initials _______

8.11 Corporate Authority. The persons executing this Agreement on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said party, (iii) by so executing this Agreement, such party is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other Agreement to which said party is bound. This Agreement shall be binding upon the heirs, executors, administrators, successors and assigns of the parties.
[Signatures On The Following Page]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first-above written.

CITY:

CITY OF SOUTH EL MONTE, a municipal
corporation
Rachel Barbosa, City Manager
ATTEST:

Donna G. Schwartz, City Clerk
APPROVED AS TO FORM:

ALESHIRE & WYNDER, LLP
Anthony R. Taylor, City Attorney
CONSULTANT:

San Gabriel Valley-Habitat for Humanity
By:

Name: Laura Ealy
Title: Director of Programs
By:

Name: Sayaka Ota
Title: Director of Finance
Address:724 E Huntington Drive
Monrovia CA 91016__
Two corporate officer signatures required when Consultant is a corporation, with one signature required from each of the following groups: 1) Chairman of the Board, President or any Vice President; and 2) Secretary, any Assistant Secretary, Chief Financial Officer or any Assistant Treasurer. CONSULTANT’S SIGNATURES

SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS

MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONSULTANT’S BUSINESS ENTITY.

01257.0001/695510.1

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

STATE OF CALIFORNIA

COUNTY OF LOS ANGELES
On __________, 2022 before me, ________________, personally appeared ________________, proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: _____________________________________

OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT

INDIVIDUAL

CORPORATE OFFICER
_______________________________

TITLE(S)

PARTNER(S) LIMITED

GENERAL

ATTORNEY-IN-FACT

TRUSTEE(S)

GUARDIAN/CONSERVATOR
OTHER_______________________________
______________________________________
SIGNER IS REPRESENTING:
(NAME OF PERSON(S) OR ENTITY(IES))
_____________________________________________
_____________________________________________
___________________________________

TITLE OR TYPE OF DOCUMENT
___________________________________

NUMBER OF PAGES
___________________________________

DATE OF DOCUMENT
___________________________________

SIGNER(S) OTHER THAN NAMED ABOVE
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy or validity of that document.

01257.0001/695510.1

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

STATE OF CALIFORNIA

COUNTY OF LOS ANGELES
On __________, 2022 before me, ________________, personally appeared ________________, proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: _____________________________________

OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT

INDIVIDUAL

CORPORATE OFFICER
_______________________________

TITLE(S)

PARTNER(S) LIMITED

GENERAL

ATTORNEY-IN-FACT

TRUSTEE(S)

GUARDIAN/CONSERVATOR
OTHER_______________________________
______________________________________
SIGNER IS REPRESENTING:
(NAME OF PERSON(S) OR ENTITY(IES))
_____________________________________________
_____________________________________________
___________________________________

TITLE OR TYPE OF DOCUMENT
___________________________________

NUMBER OF PAGES
___________________________________

DATE OF DOCUMENT
___________________________________

SIGNER(S) OTHER THAN NAMED ABOVE
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy or validity of that document.

01257.0001/695510.1 A-1
EXHIBIT “A”

SCOPE OF SERVICES
I. Consultant will perform the following services:

A. Program Administration I. Waiting List
B. Marketing J. Customer Relations
C. Program Guidelines (Manual) K. Project File/Management D. Bilingual Capabilities L. Review and Approval Applications E. Environmental Review (if applicable) M. Construction/Rehabilitation F. Photos – Before & After Catalog N. Property Standards (Zoning/Bldg Codes) G. Energy Efficiency O. Lead-Based Paint (if applicable) H. Final Inspection P. Final Documentation & Reporting
II. As part of the Services, Consultant will prepare and deliver the following tangible work products to the City:

A. Updated Program Guidelines (Manual)
B. Project Files includes photos
C. Marketing materials
III. In addition to the requirements of Section 6.2, during performance of the Services, Consultant will keep the City updated of the status of performance by delivering the following status reports:

A. Quarterly Reports (Q1 JAN-MAR; Q2 APR-JUNE; Q3 JULY-SEP; Q4 OCT-DEC) B. Annual Reports (reports due June 30)
C.

IV. All work product is subject to review and acceptance by the City, and must be revised by the Consultant without additional charge to the City until found satisfactory and accepted by City.

V. Consultant will utilize the following personnel to accomplish the Services:

01257.0001/695510.1
A. Laura Ealy, Director of Programs
B. Sayaka Ota, Director of Finance
C. Jack Masterson, Project Manager
D. Additional Staff as needed

01257.0001/695510.1 B-1
EXHIBIT “B”

SPECIAL REQUIREMENTS
(Superseding Contract Boilerplate)
The Agreement is amended as provided herein. Deleted text is indicated in strikethrough and added text in bold italics.

C-1
01257.0001/695510.1
EXHIBIT “C”

SCHEDULE OF COMPENSATION
I. Consultant shall perform the following Services at the following rates:

A. 10% of Awarded
Grant Funding;
Not-to-exceed
$100,000
B.

II. A retention of ten percent (10%) shall be held from each payment as a contract retention to be paid as a part of the final payment upon satisfactory completion of services.

III. Within the budgeted amounts for each Task, and with the approval of the Contract Officer, funds may be shifted from one Task subbudget to another so long as the Contract Sum is not exceeded per Section 2.1, unless Additional Services are approved per Section 2.3.

IV. The City will compensate Consultant for the Services performed upon submission of a valid invoice. Each invoice is to include:

A. Line items for all the work performed, the number of hours worked, and the hourly rate.

B. Line items for all materials and equipment properly charged to the Services.

C. Line items for all other approved reimbursable expenses claimed, with supporting documentation.

D. Line items for all approved subcontractor labor, supplies, equipment, materials, and travel properly charged to the Services.

V. The total compensation for the Services shall not exceed the Contract Sum as provided in Section 2.1 of this Agreement.

VI. Consultant’s billing rates for all personnel are attached as Exhibit C-1.

D-1
01257.0001/695510.1
EXHIBIT “D”

SCHEDULE OF PERFORMANCE
I. Consultant shall perform all services timely in accordance with the following schedule:

All projects shall be completed as requested by the City, and shall be completed prior to May 31, 2025. Both parties agree that all services rendered shall be covered by the CalHome Grant Funds.

II. Consultant shall deliver the following tangible work products to the City by the following dates.

A. Quarterly Reports (Q1 JAN-MAR; Q2 APR-JUNE; Q3 JULY-SEP; Q4 OCTDEC) B. Annual Reports (reports due June 30)
C.

D.

E.

III. The Contract Officer may approve extensions for performance of the services in accordance with Section 3.2.

City Council Agenda Report
Agenda Item No. 9.e.

DATE: June 28, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Rachel Barbosa, City Manager
SUBMITTED BY: William Fox, Interim Finance Director
SUBJECT: CONSIDERATION AND APPROVAL OF RESOLUTION 22-52,

COVERING THE TERMS OF A PRIVATE PLACEMENT OF

DEBT RELATED TO THE CALPERS UNFUNDED DEBT

LIABLITY APPRVOING THE FORM OF AND AUTHORIZING

THE EXECUTION AND DELIVERY OF A SITE LEASE AND A

LEASE AGREEMENT, AND AUTHORIZING OTHER MATTERS

RELATED TO THE FINANCING TRANSACTION
SUMMARY: On April 12, 2022, the City Council authorized a lease financing to refinance the City’s outstanding unfunded pension liability with CalPERS. The authorization was for a lease/leaseback transaction whereby the City would transfer certain City properties to a private entity and immediately lease them back. During the transaction process, it was revealed that most of the properties intended to be used in the UAL refinancing have solar panel arrays installed on them which were paid for with financing agreements.

Those financing agreements contain a restriction that states that those properties can only be transferred to a governmental entity. Because the initial temporary transfer of the properties to the private entity third party would violate the solar financing agreements, a change in legal structure for this financing has become necessary. The action before Council tonight will substitute the South El Monte Financing Authority as the lease counterparty instead of the originally authorized, non-governmental, lease counterparty.

All other aspects of the proposed financing structure will remain the same. In addition to action by the City Council, the Financing Authority will also need to authorize this transaction as it is now part of the structure.

RECOMMENDED ACTION: Staff recommends City Council adopt Resolution No.22-52, approving the terms of a private placement lease financing, approving the form of and authorizing the execution and delivery of a site lease and lease agreement, a trust agreement, and authorizing required actions in connection with the execution and, authorizing other matters relating to the financing.

FISCAL IMPACT: The current forecast reflects the refinancing of the City’s pension obligations will produce $3.1 million in total savings over the twenty-year financing period.

This equates to an average savings of $155,000 annually. The actual savings per year will vary based upon the loan amortization schedule.

DISCUSSION: The City has an approximately $9.6 million unfunded pension obligation owed to CalPERS. Due to the low rate obtained by the City from the Purchaser, which is “locked” as long as the financing closes by July 7, the City has an opportunity to refinance this unfunded pension obligation by acquiring financing via a private placement, lease/leaseback transaction at a much lower interest rate than it currently pays to CalPERS. CalPERS currently charges the City a high rate of interest (currently 6.8%), and structures amortization payments in a way that is causing the City to face steep increases in pension expenses over the next twenty fiscal years.

On February 22, 2022, the City Council directed Staff to assemble and work with a team of professionals to prepare the financing, including the proposed financing structure and legal documentation as discussed below. On April 12, the City Council authorized the lease/leaseback transaction. During the transaction process, it has been revealed that most of the properties intended to be used in the UAL refinancing have solar panel arrays installed on them which were paid for with financing agreements. Those financing agreements contain a restriction that states those properties can only be transferred to a governmental entity. Because the initial temporary transfer of the properties to the private entity third party as contemplated in the originally authorized structure would violate the solar financing agreements, a change in legal structure for this financing has become necessary.

The action item before the City Council tonight is for the approval of the attached Resolution. This will approve the attached forms of a Site Lease and Lease Agreement, as well as authorize staff to execute other necessary documents and certificates required to successfully consummate the financing. The Site Lease, Lease Agreement, and Assignment Agreement are each “form” documents because certain information will need to be added as the financing terms take their final form after the Council acts.

Initial Valuation of City Properties
The City’s entire inventory of properties was examined and it has been determined that the properties listed below can provide the required property value for the lease financing transaction. A primary credit approval requirement of the Purchaser is that the size of the financing does not exceed the insured value of the properties in the lease, as detailed below:

City Property Name & Address Insured Value
City Hall - 1415 Santa Anita Avenue $ 6,010.425
Aquatics Center - 1500 Central Avenue 2,147,685
Transportation Yard - 2028 Central Avenue 1,038,555
Corporate Maintenance Yard - 1900 Central
Avenue
814,710
Total $10,011,375
Good Faith Estimates for Financing Costs
The following information was obtained from the City's Municipal Advisor, Kosmont Transactions Services, Inc. with respect to the Financing to be approved in the attached Resolution, and is provided in compliance with Senate Bill 450 (Chapter 625 of the 2017-

2018 Session of the California Legislature) with respect to the Lease:

1. Finance Charge of the Financing: Assuming the aggregate principal amount of the financing to be $9,815,000 is placed and based on the interest rate offered by the Purchaser at the time of preparation of this information, a good faith estimate of the finance charges, which means the sum of all fees and charges paid to third parties (or costs associated with the Financing), is $200,000 as follows:

Cost Item Not To Exceed
Special Counsel $60,000
City Attorney 5,000
Municipal Advisor 60,000
Real Estate Advisor 10,000
Placement Agent 20,000
Purchaser Counsel 12,500
Title Insurance 14,723
COI Custodian 250
City Engineer 5.000
Miscellaneous/Contingency 17,527
Total Good Faith Estimate $200,000

2. True Interest Cost of the COPs. Assuming the aggregate principal amount of the financing to be $9,815,000 is placed and based on the interest rate offered by the Purchaser at the time of preparation of this information, a good faith estimate of the true interest cost of the financing, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the financing, is 3.3002%.

3. Amount of Proceeds to be Received: Assuming the aggregate principal amount of the financing to be $9,815,000 and based on the interest rate offered by the Purchaser at the time of preparation of this information, a good faith estimate of the amount of proceeds expected to be received by the City for consummation of the financing less the finance charge described in Paragraph 1 above and any reserves or capitalized interest paid or funded with proceeds of the Financing, is $9,615,000.

4. Total Payment Amount: Assuming the aggregate principal amount of the financing to be $9,815,000 and based on the interest rate offered by the Purchaser at the time of preparation of this information, a good faith estimate of the total payment amount, which means the sum total of all payments the City will make to pay debt service on the financing, including the finance charge of the Financing described in paragraph 1 above, calculated to the final maturity of the financing, is $13,519,785.88.

Attention is directed to the fact that the foregoing information constitutes good faith estimates only. The actual interest cost, finance charges, amount of proceeds and total payment amount may vary from the estimates above due to variations from these estimates in the timing of closing of the financing, the amount of the financing actually placed, the final amortization schedule of the financing, and other variables that may change prior to the closing of the transaction. The date of the closing and the final amount of the financing to be sold privately will be determined by the City based on the actual amount required to pay off the CalPERS pension obligation, and other factors. The

Resolution approves, among other things, the execution and delivery of the financing and the Term Sheet provided by the Purchaser which provides for an interest rate of 3.30% per annum.

ATTACHMENT(S):

A. Resolution No. 22-52
B. Site Lease
C. Lease Agreement - South El Monte 2022
D. Term Sheet

105526659.6

ATTACHMENT A

105526659.6
RESOLUTION NO. 22-52

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SOUTH EL MONTE APPROVING THE TERMS OF A PRIVATE

PLACEMENT, APPROVING THE FORM OF AND

AUTHORIZING THE EXECUTION AND DELIVERY OF A

SITE LEASE AND A LEASE AGREEMENT, AND

AUTHORIZING OTHER MATTERS RELATING THERETO
WHEREAS, the City of South El Monte, California (the “City”) is a municipal corporation and a general law city duly organized and existing under and pursuant to the Constitution and laws of the State of California.

WHEREAS, it has been proposed that the South El Monte Financing Authority, a joint powers authority duly organized and validly existing under and by virtue of the laws of the State of California (the “Authority”) assist the City in refinancing certain obligations of the City to the California Public Employees’ Retirement System’s (“CalPERS”); and WHEREAS, the City has received, and desires to accept, a bid for a private placement with First Foundation Public Finance, a Delaware statutory trust and a wholly-owned subsidiary of First Foundation Bank (“First Foundation”); and
WHEREAS, in connection therewith, the City Council of the City (the “City Council”) wishes to proceed with a lease financing in the manner set forth in that certain Lease Agreement described below; and
WHEREAS, the City will lease to the Authority certain real property (the “Leased Property”) pursuant to a Site Lease (the “Site Lease”) and the Authority, concurrently with the execution of the Site Lease, will sublease the Leased Property back to the City pursuant to a Lease Agreement (the “Lease Agreement”) in consideration for rental payments and assign certain rights and the rental payments under the Lease Agreement to First Foundation.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SOUTH EL MONTE FINDS, RESOLVES, AND ORDERS AS FOLLOWS:

Section 1. The City Council finds that all of the facts set forth in the Recitals are true and correct, and are incorporated herein by reference.

Section 2. The City hereby approves an aggregate principal amount of Lease Payments under the Lease Agreement not to exceed $9,900,000.

Section 3. The City hereby accepts the First Foundation interest rate of 3.3% (assuming no default) for the proposed private placement, subject to the authorizations and limitations set forth herein and final delivery of the documents authorized hereby.

Section 4. The City hereby approves the form of Site Lease, substantially in the form presented to the City Council and on file with the City Clerk, with such revisions, amendments and completions as shall be approved by the Mayor, the City Manager, the Interim Finance

105526659.6
Director and any of their respective designees (each a “Responsible Officer”), with the advice of special counsel to the City and the City Attorney, such approval to be conclusively evidenced by the execution and delivery thereof.

Section 5. The City hereby approves the form of Lease Agreement, substantially in the form presented to the City Council and on file with the City Clerk, with such revisions, amendments and completions as shall be approved by a Responsible Officer, with the advice of special counsel to the City and the City Attorney, such approval to be conclusively evidenced by the execution and delivery thereof.

Section 6. In connection with the private placement, the City Council hereby approves the appointment of Norton Rose Fulbright US LLP to perform special counsel services, Kosmont Transactions Services, Inc., to perform Municipal Advisor services, and Hilltop Securities, Inc., as placement agent. Any Responsible Officer is hereby authorized and directed to enter into professional services agreements with each of the foregoing.

Section 7. Each Responsible Officer and other officers of the City are hereby authorized and directed, jointly and severally, for and in the name on behalf of the City, to execute and deliver a placement agent agreement, a fiscal agent agreement for payment of costs of issuance, and any and all other agreements, assignments, documents, certificates and other instruments, and to do any and all things and take any and all actions which may be necessary or advisable in their discretion, to carry out and give effect to the actions which the City has approved in this Resolution.

Section 8. All actions heretofore taken by any Responsible Officer or any officer, employee or agent of the City in connection with or related to any of the agreements referred to herein, are hereby approved, confirmed and ratified.

Section 9. This Resolution may be executed with electronic signatures in accordance with Government Code of the State of California §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.

Section 10. This Resolution becomes effective immediately upon adoption.

PASSED, APPROVED, AND ADOPTED this 28th day of June 2022.

Gloria Olmos, Mayor
ATTEST:
_______________________________
Donna G. Schwartz, City Clerk

105526659.6

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss

CITY OF SOUTH EL MONTE )
I, Donna G. Schwartz, City Clerk of the City of South El Monte, do hereby certify that the foregoing Resolution No. 22-52 was duly passed and approved by the City Council of the City of South El Monte at a regular meeting of said Council held on the 28th day of June 2022, and that said Resolution was adopted by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
_______________________________
Donna G. Schwartz, City Clerk

NRF/105359009.4

ATTACHMENT B

NRF DRAFT – 6/21/22
105359009.4
AFTER RECORDATION PLEASE RETURN TO:

Norton Rose Fulbright US LLP
555 South Flower Street, Suite 4100
Los Angeles, California 90071
Attention: Russell C. Trice, Esq.

SITE LEASE
by and between

CITY OF SOUTH EL MONTE,
as Lessor
and

SOUTH EL MONTE FINANCING AUTHORITY,
as Lessee
Dated as of July 1, 2022
THIS IS A FINANCING DOCUMENT:

NO DOCUMENT TRANSFER TAX IS DUE
PURSUANT TO GOVERNMENT CODE SECTION 27383

TABLE OF CONTENTS
Page
105359009.4 -iSECTION 1. Definitions .......................................................................................................1 SECTION 2. Site Lease .........................................................................................................1 SECTION 3. Term .................................................................................................................1 SECTION 4. Rental................................................................................................................1 SECTION 5. Purpose .............................................................................................................1 SECTION 6. Owner in Fee.....................................................................................................2 SECTION 7. Substitution of Leased Property .......................................................................2 SECTION 8. Assignments and Subleases ..............................................................................2 SECTION 9. Right of Entry ...................................................................................................2 SECTION 10. Termination ......................................................................................................2 SECTION 11. Default ..............................................................................................................2 SECTION 12. Quiet Enjoyment ..............................................................................................2 SECTION 13. Waiver of Personal Liability.............................................................................2 SECTION 14. Taxes.................................................................................................................3 SECTION 15. Eminent Domain...............................................................................................3 SECTION 16. Partial Invalidity ...............................................................................................3 SECTION 17. Notices ..............................................................................................................3 SECTION 18. Amendment ......................................................................................................3 SECTION 19. No Merger of Interests .....................................................................................3 SECTION 20. Section Headings ..............................................................................................3 SECTION 21. Compliance with Laws and Regulations ..........................................................3 SECTION 22. Environmental Compliance ..............................................................................4 SECTION 23. Execution .........................................................................................................6 SECTION 24. Governing Law .................................................................................................6 SECTION 25. Third-Party Beneficiaries .................................................................................6 EXHIBIT A – LEGAL DESCRIPTION OF LEASED PROPERTY

105359009.4

SITE LEASE
THIS SITE LEASE, dated as of July 1, 2022 (this “Site Lease”), by and between the CITY OF SOUTH EL MONTE, a general law city duly organized and existing under and by virtue of the laws of the State of California (the “City”), as lessor (the “Lessor”), and the SOUTH EL MONTE FINANCING AUTHORITY, a joint powers authority duly organized and validly existing under and by virtue of the laws of the State of California (the “Authority”), as lessee (the “Lessee”);
W I T N E S S E T H:

WHEREAS, the Authority intends to assist the City in refinancing certain obligations of the City to the California Public Employees’ Retirement System’s (“CalPERS”), and to lease certain Leased Property (as defined herein) to the City under a Lease Agreement, dated of even date herewith (the “Lease”), by and between the City and the Authority, and the City proposes to enter into this Site Lease with the Authority as a material consideration for the Authority’s agreement to enter into that certain Assignment Agreement, dated of even date herewith (the “Assignment Agreement”), by and between the Authority and FIRST FOUNDATION PUBLIC FINANCE, a Delaware statutory trust and a wholly-owned subsidiary of First Foundation Bank (as further defined in the Lese, the “Assignee”);
NOW, THEREFORE, IT IS HEREBY MUTUALLY AGREED as follows:

SECTION 1. Definitions Unless the context otherwise requires, all capitalized terms used in this Site Lease and not defined herein shall for all purposes of this Site Lease have the meanings specified therefor in the Lease.

SECTION 2. Site Lease The City hereby leases to the Authority and the Authority hereby hires from the City, on the terms and conditions hereinafter set forth, the real property situated in the County of Los Angeles, State of California as more particularly described in Exhibit A attached hereto and made a part hereof (the “Leased Property”).

SECTION 3. Term The term of this Site Lease shall commence on the Closing Date and shall remain in effect until the term of the Lease expires as provided by Article IV, Section

4.2 thereof; provided, however, that if Lease Payments (as defined therein) due under the Lease remain unpaid at the expiration of the Lease term, or provision shall not have been made for their payment, then this Site Lease shall not terminate until the earlier of (i) _______ 1, 20__, or, if later, (ii) the date on which the Lease Payments and all other amounts due under the Lease have been paid in full.

SECTION 4. Rental The City acknowledges receipt from the Authority as and for rental hereunder the sum of One Dollar ($1.00), on or before the date of delivery of the assignment under the Assignment Agreement to the Assignee.

SECTION 5. Purpose The Authority shall use the Leased Property solely for the purpose of leasing the Leased Property to the City pursuant to the Lease, and for such purposes as may be incidental thereto; provided, that in the event of default by the City under the Lease, the Authority and its assigns may exercise the remedies provided in the Lease.

2 SECTION 6. Owner in Fee The City covenants, represents and warrants that it is the owner in fee of the Leased Property.

SECTION 7. Substitution of Leased Property From time to time, the City may authorize the Substitution of alternate real property or equipment for the Leased Property, the Removal of real property or equipment from the Leased Property or the addition of real property or equipment to the Leased Property pursuant to the Lease, with the prior written consent of the Assignee. In connection therewith, the City and the Authority shall enter into a duly recorded amendment or supplement to this Site Lease. If the City effects a substitution of all or a portion of the Leased Property hereunder, all or a designated portion of the Leased Property formerly subjected to this Site Lease shall be released from the lien hereof upon receipt by the Authority of (a) the written request of the City to that effect, and (b) a further opinion of Special Counsel to the effect that such release will have no material adverse effect upon the Assignee. After any such release, the term “Leased Property” shall be defined as the remaining portion of the Leased Property.

SECTION 8. Assignments and Subleases Unless the City shall be in default under the Lease, the Authority may not assign its rights under this Site Lease or sublet the Leased Property, except as provided in the Lease and the Assignment Agreement, without the written consent of the City and the Assignee.

SECTION 9. Right of Entry The City reserves the right for any of its duly authorized representatives to enter upon the Leased Property at any reasonable time to inspect the same or to make any repairs, improvements or changes necessary for the preservation thereof.

SECTION 10. Termination The Authority agrees, upon the termination of this Site Lease, to quit and surrender the Leased Property in the same good order and condition as the same were in at the time of commencement of the term hereunder, reasonable wear and tear excepted, and agrees that any permanent improvements and structures existing upon the Leased Property at the time of the termination of this Site Lease shall remain thereon and title thereto shall vest in the City.

SECTION 11. Default If the Authority shall be in default in the performance of any obligation of its part to be performed under the terms of this Site Lease, which default continues for 30 Business Days following notice and demand for correction thereof to the Authority, the City may exercise any and all remedies granted by law, except that no merger of this Site Lease and of the Lease shall be deemed to occur as a result thereof.

SECTION 12. Quiet Enjoyment The Authority at all times during the term of this Site Lease shall peaceably and quietly have, hold and enjoy all of the Leased Property, subject to the provisions of the Lease.

SECTION 13. Waiver of Personal Liability All liabilities under this Site Lease on the part of the Authority are solely liabilities of the Authority, as a separate legal entity, and the City hereby releases each and every member, director and officer of the Authority of and from any personal or individual liability under this Site Lease. No member, director or officer of the

3 Authority shall at any time or under any circumstances be individually or personally liable under this Site Lease for anything done or omitted to be done by the Authority hereunder.

SECTION 14. Taxes The City covenants and agrees to pay any and all assessments of any kind or character and also all taxes, including possessory interest taxes, levied or assessed upon the Leased Property (including both land and improvements).

SECTION 15. Eminent Domain If the whole or any part of the Leased Property shall be taken by eminent domain proceedings, the interest of the Authority shall be recognized and is hereby determined to be the amount of the then-unpaid Lease Payments, and the balance of the award, if any, shall be paid to the City.

SECTION 16. Partial Invalidity If any one or more of the terms, provisions, covenants or conditions of this Site Lease shall to any extent be declared invalid, unenforceable, void or voidable for any reason whatsoever by a court of competent jurisdiction, the finding or order or decree of which becomes final, none of the remaining terms, provisions, covenants and conditions of this Site Lease shall be affected thereby, and each provision of this Site Lease shall be valid and enforceable to the fullest extent permitted by law.

SECTION 17. Notices All notices, statements, demands, consents, approvals, authorizations, offers, designations, requests or other communications hereunder by either party to the other shall be in writing and shall be sufficiently given and served upon the other party if delivered personally or if mailed by United States registered mail, return receipt requested, postage prepaid, and, if to the City, addressed to City of South El Monte 1415 Santa Anita Avenue, South El Monte, CA 91733, Attention: City Manager, or if to the Authority, addressed to the South El Monte Financing Authority, 1415 Santa Anita Avenue, South El Monte, CA 91733, Attention:

Chief Administrative Officer, or to such other addresses as the respective parties may from time to time designate by notice in writing.

SECTION 18. Amendment This Site Lease may not be altered, modified or amended except as permitted by the Lease and to modify the description of the site on which the Leased Property components are located.

SECTION 19. No Merger of Interests The leasehold estates under this Site Lease and the Lease shall not merge, whether by the exercise of any right or remedy hereunder or thereunder, by operation of law, or otherwise.

SECTION 20. Section Headings All section headings contained herein are for convenience of reference only and are not intended to define or limit the scope of any provision of this Site Lease.

SECTION 21. Compliance with Laws and Regulations
(a) The City has, after due inquiry, no knowledge and has not given or received any written notice indicating that the Leased Property or the past or present use thereof or any practice, procedure or policy employed by it in the conduct of its business materially violates any applicable law, regulation, code, order, rule, judgment or consent agreement, including, without limitation, those relating to zoning, building, use and occupancy, fire safety, health sanitation, air

4 pollution, ecological matters, environmental protection, hazardous or toxic materials, substances or wastes, conservation, parking, architectural barriers to the handicapped, or restrictive covenants or other agreements affecting title to the Leased Property (collectively, “Laws and Regulations”).

Without limiting the generality of the foregoing, neither the City nor to the best of its knowledge, after due inquiry, any prior or present owner, tenant or subtenant of any of the Leased Property has, other than as set forth in subsections (a) and (b) of this Section or as may have been remediated in accordance with Laws and Regulations, (i) used, treated, stored, transported or disposed of any material amount of flammable explosives, polychlorinated biphenyl compounds, heavy metals, chlorinated solvents, cyanide, radon, petroleum products, asbestos or any Asbestos Containing Materials, methane, radioactive materials, pollutants, hazardous materials, hazardous wastes, hazardous, toxic, or regulated substances or related materials, as defined in CERCLA, RCRA, CWA, CAA, TSCA and Title III, and the regulations promulgated pursuant thereto, and in all other Environmental Regulations applicable to the City, any of the Leased Property or the business operations conducted by the City thereon (collectively, “Hazardous Materials”) on, from or beneath its Leased Property, (ii) pumped, spilled, leaked, disposed of, emptied, discharged or released (hereinafter collectively referred to as “Release”) any material amount of Hazardous Material on, from or beneath the Leased Property, or (iii) stored any material amount of petroleum products at the Leased Property in underground storage tanks. (b) Excluded from the representations and warranties in subsection (a) hereof with respect to Hazardous Materials are those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city, the use, treatment, storage, transportation and disposal of which has been and shall be in compliance with all Laws and Regulations.
(c) No part of the Leased Property is located in an area of high potential incidence of radon has an unventilated basement or subsurface portion which is occupied or used for any purpose other than the foundation or support of the improvements to such Leased Property.

SECTION 22. Environmental Compliance
(a) The City shall not use or permit the Leased Property or any part thereof to be used to generate, manufacture, refine, treat, store, handle, transport or dispose of, transfer, produce or process Hazardous Materials, except, and only to the extent, if necessary to maintain the improvements on the Leased Property and then, only in compliance with all Environmental Regulations, and any state equivalent laws and regulations, nor shall it permit, as a result of any intentional or unintentional act or omission on its part or by any tenant, subtenant, licensee, guest, invitee, contractor, employee and agent, the storage, transportation, disposal or use of Hazardous Materials or the Release or threat of Release of Hazardous Materials on, from or beneath the Leased Property or onto any other property excluding, however, those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city facility, the use, storage, treatment, transportation and disposal of which shall be in compliance with all Environmental Regulations. Upon the occurrence of any Release or threat of Release of Hazardous Materials, the City shall promptly commence and perform, or cause to be commenced and performed promptly, without cost to the Authority, all investigations, studies, sampling and testing, and all remedial, removal and other actions necessary to clean up and remove all Hazardous Materials so released, on, from or beneath the Leased Property or other property, in compliance

5 with all Environmental Regulations. Notwithstanding anything to the contrary contained herein, underground storage tanks shall only be permitted subject to compliance with subsection (d) hereof and only to the extent necessary to maintain the improvements on the Leased Property. (b) The City shall comply with, and shall use its best efforts to cause any tenants, subtenants, agents, licensees, employees, contractors, and agents to comply with, all Environmental Regulations and shall keep the Leased Property free and clear from Hazardous Materials; provided, however, that notwithstanding that a portion of this covenant is limited to the City’s use of its best efforts, the City shall remain solely responsible for ensuring such compliance and such limitation shall not diminish or affect in any way the City’s obligations contained in subsection (c) hereof as provided in subsection (c) hereof. Upon receipt of any notice from any Person with regard to the Release of Hazardous Materials on, from or beneath the Leased Property as provided for in Exhibit A attached hereto, the City shall give prompt written notice thereof to the Authority and the Assignee (and, in any event, prior to the expiration of any period in which to respond to such notice under any Environmental Regulation). (c) Irrespective of whether any representation or warranty contained herein is not true or correct, the City shall defend, indemnify and hold harmless the Assignee, its partners, depositors and each of its and their employees, agents, officers, directors, trustees, successors and assigns, from and against any claims, demands, penalties, fines, attorneys’ fees (including, without limitation, attorneys’ fees incurred to enforce the indemnification contained in this Section) consultants’ fees, investigation and laboratory fees, liabilities, settlements (five Business Days’ prior notice of which the Authority or the Assignee, as appropriate, shall have delivered to the City), court costs, damages, losses, costs or expenses of whatever kind or nature, known or unknown, contingent or otherwise, occurring in whole or in part, arising out of, or in any way related to, (i) the presence, disposal, Release, threat of Release, removal, discharge, storage or transportation of any Hazardous Materials on, from or beneath the Leased Property, (ii) any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to such Hazardous Materials, (iii) any lawsuit brought or threatened, settlement reached (five Business Days’ prior notice of which the Authority or the Assignee, as appropriate, shall have delivered to the City), or governmental order relating to Hazardous Materials on, from or beneath any of the Leased Property, (iv) any violation of Environmental Regulations or subsection (a) or (b) hereof by it or any of its agents, tenants, employees, contractors, licensees, guests, subtenants or invitees, and (v) the imposition of any governmental Lien for the recovery of environmental cleanup or removal costs. To the extent that the City is strictly liable under any Environmental Regulation, its obligation to the Authority and the Assignee and the other indemnities under the foregoing indemnification shall likewise be without regard to fault on its part with respect to the violation of any Environmental Regulation which results in liability to any indemnitee. Its obligations and liabilities under this subsection (c) shall survive any foreclosure of the security interest in the Leased Property.
(d) The City shall conform to and carry out a reasonable program of maintenance and inspection of all underground storage tanks, and shall maintain, repair, and replace such tanks only in accordance with Laws and Regulations, including but not limited to Environmental Regulations.

6 SECTION 23. Execution This Site Lease may be executed in any number of counterparts, each of which shall be deemed to be an original but all together shall constitute but one and the same lease.

SECTION 24. Governing Law This Site Lease shall be governed by and construed in accordance with the laws of the State of California applicable to contracts made and performed in such State.

SECTION 25. Third-Party Beneficiaries The Assignee is expressly recognized as thirdparty beneficiaries under this Site Lease. [Remainder of page intentionally left blank.]

7 IN WITNESS WHEREOF, the City and the Authority have caused this Site Lease to be executed by their respective officers thereunto duly authorized, all as of the day and year first above written.

CITY OF SOUTH EL MONTE,
as Lessor
By:

City Manager

SOUTH EL MONTE FINANCING AUTHORITY,
as Lessee
By:

Chief Administrative Officer

8 A NOTARY PUBLIC OR OTHER OFFICER COMPLETING THIS CERTIFICATE

VERIFIES ONLY THE IDENTITY OF THE INDIVIDUAL WHO SIGNED THE

DOCUMENT TO WHICH THIS CERTIFICATE IS ATTACHED, AND NOT THE TRUTHFULNESS, ACCURACY, OR VALIDITY OF THAT DOCUMENT.

STATE OF CALIFORNIA )
) ss:

COUNTY OF LOS ANGELES )
On ______________________________ before me,__________________________(insert name of the officer), Notary Public, personally appeared _________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
_________________________________ [Seal]

105359009.4

EXHIBIT A

LEGAL DESCRIPTION OF LEASED PROPERTY

NRF/105390540.5

ATTACHMENT C

NRF DRAFT – 6/22/22
11995-2
AFTER RECORDATION PLEASE RETURN TO:

Norton Rose Fulbright US LLP
555 South Flower Street, Suite 4100
Los Angeles, California 90071
Attention: Russell C. Trice, Esq.

LEASE AGREEMENT
by and between

SOUTH EL MONTE FINANCING AUTHORITY,
as Lessor
and

CITY OF SOUTH EL MONTE,
as Lessee
Dated as of July 1, 2022
THIS IS A FINANCING DOCUMENT:

NO DOCUMENT TRANSFER TAX IS DUE
PURSUANT TO GOVERNMENT CODE SECTION 27383

TABLE OF CONTENTS
Page
105390540.5
ARTICLE I DEFINITIONS AND EXHIBITS ..............................................................................1 SECTION 1.1 Definitions and Rules of Construction .................................................1 SECTION 1.2 Exhibits.................................................................................................5 ARTICLE II REPRESENTATIONS, COVENANTS AND WARRANTIES...............................5 SECTION 2.1 Representations, Covenants and Warranties of Lessee ........................5 SECTION 2.2 Representations, Covenants and Warranties of Lessor.........................9 ARTICLE III DEPOSIT AND APPLICATION OF FUNDS......................................................10 SECTION 3.1 Deposit of and Application of Funds..................................................10 SECTION 3.2 Leased Property ..................................................................................10 SECTION 3.3 Lessee to Act as Agent for the Lessor ................................................10 SECTION 3.4 Reserved .............................................................................................11 SECTION 3.5 Substitution of Alternate Leased Property and Release of Leased Property ..................................................................................11 ARTICLE IV AGREEMENT TO LEASE; TERMINATION OF LEASE; LEASE PAYMENTS; TITLE TO THE LEASED PROPERTY.................................12 SECTION 4.1 Lease...................................................................................................12 SECTION 4.2 Term of Agreement.............................................................................12 SECTION 4.3 Lease Payments ..................................................................................12 SECTION 4.4 Quiet Enjoyment.................................................................................14 SECTION 4.5 Title to the Leased Property................................................................15 SECTION 4.6 Additional Payments...........................................................................15 ARTICLE V MAINTENANCE; TAXES; INSURANCE; OTHER MATTERS ........................16 SECTION 5.1 Maintenance, Utilities, Taxes and Assessments.................................16 SECTION 5.2 Modification of the Leased Property ..................................................16 SECTION 5.3 Public Liability and Property Damage Insurance; Workers’ Compensation Insurance.....................................................................17 SECTION 5.4 Fire and Theft Insurance.....................................................................18 SECTION 5.5 Rental Interruption and Title Insurance..............................................18 SECTION 5.6 General Insurance Provisions .............................................................18 SECTION 5.7 Liens ...................................................................................................19 SECTION 5.8 Use of the Leased Property.................................................................20 SECTION 5.9 Advances.............................................................................................20 SECTION 5.10 Agreement to Pay Program Expenses.................................................20

TABLE OF CONTENTS
(continued)
Page
105390540.5
ii
SECTION 5.11 Books and Records .............................................................................20 ARTICLE VI DAMAGE AND DESTRUCTION; USE OF NET INSURANCE AND CONDEMNATION PROCEEDS ..................................................................20 SECTION 6.1 Abatement of Lease Payments in Event of Loss of Use.....................20 SECTION 6.2 Application of Net Insurance and Condemnation Proceeds...............21 SECTION 6.3 Laws and Ordinances..........................................................................22 ARTICLE VII DISCLAIMER OF WARRANTIES; ACCESS TO THE LEASED PROPERTY....................................................................................................22 SECTION 7.1 Disclaimer of Warranties....................................................................22 SECTION 7.2 Lessee’s Right to Enforce Warranties ................................................22 SECTION 7.3 Access to the Leased Property............................................................23 SECTION 7.4 Release and Indemnification Covenants.............................................23 ARTICLE VIII ASSIGNMENT, SUBLEASING AND AMENDMENT ...................................23 SECTION 8.1 Assignment by the Lessor...................................................................23 SECTION 8.2 Assignment and Subleasing by the Lessee .........................................23 SECTION 8.3 Amendment.........................................................................................24 ARTICLE IX EVENTS OF DEFAULT AND REMEDIES........................................................24 SECTION 9.1 Events of Default Defined ..................................................................24 SECTION 9.2 Remedies on Default...........................................................................25 SECTION 9.3 No Remedy Exclusive ........................................................................27 SECTION 9.4 Agreement to Pay Attorneys’ Fees and Expenses ..............................27 SECTION 9.5 No Additional Waiver Implied by One Waiver..................................27

ARTICLE X PREPAYMENT OF LEASE PAYMENTS AND PURCHASE OF
LEASED PROPERTY....................................................................................27 SECTION 10.1 Security Deposit..................................................................................27 SECTION 10.2 Mandatory Prepayment From Net Insurance and Condemnation Proceeds..............................................................................................28 ARTICLE XI ADDITIONAL COVENANTS .............................................................................28 SECTION 11.1 Compliance with and Enforcement of this Lease...............................28 SECTION 11.2 Observance of Laws and Regulations.................................................28 SECTION 11.3 Prosecution and Defense of Suits .......................................................29 SECTION 11.4 Reporting to Assignee .......................................................................29

TABLE OF CONTENTS
(continued)
Page
105390540.5
iii
SECTION 11.5 Further Assurances ...........................................................................29 ARTICLE XII MISCELLANEOUS.............................................................................................29 SECTION 12.1 Notices ................................................................................................29 SECTION 12.2 Binding Effect.....................................................................................29 SECTION 12.3 Severability.........................................................................................30 SECTION 12.4 Lessor Not Liable ...............................................................................30 SECTION 12.5 Net-Net-Net Lease..............................................................................30 SECTION 12.6 Further Assurances and Corrective Instruments.................................30 SECTION 12.7 Execution in Counterparts ..................................................................30 SECTION 12.8 Applicable Law...................................................................................30 SECTION 12.9 Third-Party Beneficiaries....................................................................30 SECTION 12.10 No Merger of Estate............................................................................30 SECTION 12.11 Assignee not Municipal Advisor ........................................................30 SECTION 12.12 Judicial Reference...............................................................................31 EXHIBITS:

Exhibit A – Schedule of Lease Payments
Exhibit B – Legal Description of Leased Property

LEASE AGREEMENT
THIS LEASE AGREEMENT, dated as of July 1, 2022 (this “Lease”), by and between the SOUTH EL MONTE FINANCING AUTHORITY, a joint powers authority duly organized and validly existing under and by virtue of the laws of the State of California, as lessor (the “Lessor” or “Authority”), and the CITY OF SOUTH EL MONTE, general law city duly organized and existing under the laws of the State of California, as lessee (the “Lessee” or “City”); W I T N E S S E T H:

WHEREAS, Section 37350 et seq. of the Government Code of the State of California (the “Government Code”) provides that the Lessee may enter into a lease agreement for real and personal property in the State of California (the “State”); and WHEREAS, the Lessee has leased certain real property and improvements to the Lessor under that certain Site Lease, dated as of July 1, 2022 (the “Site Lease”), by and between the Lessee and Lessor; and
WHEREAS, the Lessor intends to assist the Lessee in refinancing certain obligations of the Lessee to the California Public Employees’ Retirement System’s (“CalPERS”), and in furtherance thereof to lease those real properties and improvements belonging to the Lessee and subject to the Site Lease (collectively, the “Leased Property,” as more particularly described in Exhibit B hereto) to the Lessee hereunder; and
WHEREAS, the Lessor will assign its rights, title and interest under this Lease, subject to certain exceptions, to FIRST FOUNDATION PUBLIC FINANCE, a Delaware statutory trust and a wholly-owned subsidiary of First Foundation Bank (the “Assignee”) under an Assignment Agreement, dated as of July 1, 2022 (the “Assignment Agreement”), between the Lessor and the Assignee; and
WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and delivery of this Lease do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this Lease; and
NOW, THEREFORE, in consideration of the above premises and of the mutual covenants hereinafter contained and for other good and valuable consideration, the receipt and sufficiency is hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS AND EXHIBITS
SECTION 1.1 Definitions and Rules of Construction Unless the context otherwise indicates, words importing the singular number shall include the plural number and vice versa.

The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar terms, as used in this Lease, refer to this Lease as a whole.

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2 “Additional Payments” means the amounts specified as such in Section 4.6 of this Lease. “Asbestos Containing Materials” shall mean material in friable form containing more than one percent (1%) of the asbestiform varieties of (a) chrysotile (serpentine); (b) crocidolite (ricbeckite); (c) amosite (cummington-itegrinerite); (d) anthophyllite; (e) tremolite; and (f) actinolite.
“Assignee” means (a) initially, First Foundation Public Finance, a Delaware statutory trust and a wholly-owned subsidiary of First Foundation Bank, as assignee of all rights, title and interests of the Authority hereunder, and (b) any other entity to whom the rights of the Authority hereunder are assigned, including subsequent assignees of the Assignee, as provided in this Lease. “Assignment Agreement” means the Assignment Agreement, dated as of July 1, 2022, between the Authority, as assignor of its rights under the Site Lease and this Lease, and the Assignee, as assignee, as originally executed or as thereafter amended under any duly authorized and executed amendments thereto.
“Authority” means the South El Monte Financing Authority, a joint powers authority duly organized and existing under the Joint Exercise of Powers Agreement, dated March 30, 1989, by and between the City and the South El Monte Parking Authority and the laws of the State of California.
“Authorized Signatory” or “Authorized Representative” means: (i) in the case of the Lessor, the President or the designee of any such official or any person authorized by resolution of the Board of Directors of the Lessor to perform such act or to execute such documents; (ii) in the case of the Lessee, the Mayor, the City Manager, or the Director of Finance, or any other person authorized in writing by the Governing Board of the Lessee to act on behalf of the Lessee with respect to this Lease and any related documents; and (iii) in the case of the Assignee, any person authorized to perform any act or sign any document for the Assignee, including this Lease and the Assignment Agreement.
“Business Day” means any day (other than a Saturday, Sunday or holiday) on which banks in California or New York are not authorized or obligated by law or executive order to remain closed.
“Closing Date” means July 7, 2022.
“Costs of Issuance” means all items of expense directly or indirectly payable by or reimbursable to the District relating to the authorization and execution of the Lease, including but not limited to filing and recording fees, fees, charges and disbursements of attorneys, including counsel to the Assignee, counsel to the Authority, accounting firms, consultants and other professionals, fees and charges for preparation, execution and safekeeping of the Lease, administrative costs of the City and the Authority incurred in connection with the issuance of the Lease, expenses of the placement agent of the Lease, and any other cost, charge or fee in connection with the original issuance of the Lease, including fees of the California Debt and Investment Advisory Commission.
“County” means the County of Los Angeles, California.

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3 “Default Rate” means the interest rate of 3.30%, plus three percent 3.00% (calculated on the basis of a 365-day year and actual days elapsed).
“Defeasance Obligations” means: (1) cash, (2) non-callable direct obligations of the United States of America (“Treasuries”), (3) evidences of ownership of proportionate interests in future interest and principal payments on Treasuries held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying Treasuries are not available to any person claiming through the custodian or to whom the custodian may be obligated, (4) pre-refunded municipal obligations rated “AAA” and “Aaa” by S&P and Moody’s, respectively, or (5) securities eligible for “AAA” defeasance under then-existing criteria of S&P or any combination thereof. “Environmental Regulations” shall mean all Laws and Regulations, as defined in Article II, Section 2.1(k)(1) herein, now or hereafter in effect, with respect to Hazardous Materials, as defined in, including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act, as amended (42 U.S.C. Section 9601, et seq.) (together with the regulations promulgated thereunder, “CERCLA”), the Resource Conservation and Recovery Act, as amended (42 U.S.C. Section 6901, et seq.) (together with regulations promulgated thereunder, “RCRA”), the Emergency Planning and Community Right-to-Know Act, as amended (42 U.S.C.

Section 11001, et seq.) (together with the regulations promulgated thereunder, “Title III”), the Clean Water Act, as amended (33 U.S.C. Section 1321, et seq.) (together with the regulations promulgated thereunder, “CWA”), the Clean Air Act, as amended (42 U.S.C. Section 7401, et seq.) (together with the regulations promulgated thereunder, “CAA”) and the Toxic Substances Control Act, as amended (15 U.S.C. Section 2601 et seq.) (together with the regulations promulgated thereunder, “TSCA”), and any state or local similar laws and regulations and any socalled local, state or federal “superfund” or “superlien” law. “Governing Board” when used with reference to the Lessee means the City Council of the Lessee and when used with reference to the Lessor the Authority Commission of the Lessor. “Hazardous Materials” shall have the meaning provided in Article II, Section 2.1(k)(1) hereof.
“Improvements” means any public improvements on real property owned by the Lessee and leased to the Lessor pursuant to the Site Lease.
“Insurance Consultant” means an individual or firm employed by the Lessee as an independent contractor, experienced in the field of risk management. “Interest Component” means the portion of the Lease Payments designated as interest on Exhibit A hereto.
“Joint Exercise of Powers Agreement” means the Joint Exercise of Powers Agreement, dated March 30, 1989, by and between the City and the South El Monte Parking Authority “Laws and Regulations” shall have the meaning provided in Article II, Section 2.1(k)(1) hereof.

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4 “Lease Payment Date” means May 1 and November 1 of each year, commencing November 1, 2022.
“Leased Property” means, collectively, all of the Leased Property and Leased Property Components of the real and/or personal property, consisting of the site and the capital improvements described in Exhibit B to the Lease.
“Leased Property Component” means any identifiable portion or singular parcel comprising the real and/or personal property described in Exhibit B to the Lease. “Net Insurance and Condemnation Proceeds” means any net proceeds of insurance or condemnation proceeds paid with respect to the affected portion of any Leased Property remaining after payment therefrom of any expenses (including attorneys’ fees) incurred in the collection thereof.
“Permitted Encumbrances” means, with respect to the Leased Property, as of any particular time: (i) liens for general ad valorem taxes and assessments, if any, not then delinquent, or which the Lessee may, pursuant to the provisions of Article V of this Lease, permit to remain unpaid; (ii) the Site Lease; (iii) the Assignment Agreement; (iv) this Lease; (v) any right or claim of any mechanic, laborer, materialman, supplier or vendor not filed or perfected in the manner prescribed by law; and (vi) easements, rights of way, mineral rights, drilling rights and other rights, reservations, covenants, conditions or restrictions which the Lessee certifies in writing will not impair the use of the Leased Property or to which the Lessor consents in writing. “Principal Component” means the portion of the Lease Payments designated as principal. “Program Expenses” means all administrative costs of the Lessor relating to the Leased Property, including, without limitation, taxes of any sort whatsoever payable by the Lessor as a result of its ownership of the Leased Property or its undertaking of the transactions contemplated herein or in the Lease, Costs of Issuance, fees of auditors, accountants, attorneys or engineers, insurance premiums, credit enhancement fees, and all other necessary administrative costs of the Lessor or charges required to be paid by it in order to maintain its existence or to comply with the terms of this Lease or to defend the Lessor.
“Release” shall have the meaning provided in Article II, Section 2.1(k)(1) hereof. “Removal” means the release of all or a portion of the Leased Property from the leasehold hereof and of the Site Lease, as provided in Article III, Section 3.6 hereof. “Site Lease” means the Site Lease, dated as of July 1, 2022, by and between the Lessor, as lessee thereunder, and the Lessee, as lessor thereunder, and any duly authorized and executed amendments or supplements thereto.
“Special Counsel” means Norton Rose Fulbright US LLP or another firm of attorneys of nationally recognized standing in matters pertaining to obligations issued by states and their political subdivisions.
“State” means the State of California.

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5 “Substitution” means the release of all or a portion of the Leased Property from the leasehold hereof and of the Site Lease, and the lease of substituted real property and Improvements and/or equipment, if any, hereunder and under the Site Lease, as provided in Article III, Section

3.8 hereof.

SECTION 1.2 Exhibits The following Exhibits are attached to, and by this reference incorporated into and made a part of, this Lease: Exhibit A – Schedule of Lease Payments to be made by the Lessee to the Lessor; Exhibit B – Legal Description of Leased Property.

ARTICLE II

REPRESENTATIONS, COVENANTS AND WARRANTIES
SECTION 2.1 Representations, Covenants and Warranties of Lessee The Lessee represents, covenants and warrants to the Lessor as follows:
(a) Due Organization and Existence The Lessee is a municipal corporation and general law city, duly organized and existing under and by virtue of the laws of the State, has full legal right, power and authority under the laws of the State to enter into the Site Lease and this Lease and to carry out and consummate all transactions on its part contemplated hereby and thereby, and by proper action the Lessee has duly authorized the execution and delivery by the Lessee of the Site Lease and this Lease.
(b) Authorization; Enforceability The Constitution and laws of the State authorize the Lessee to enter into this Lease and the Site Lease (collectively, the “Agreements”) and to enter into the transactions contemplated by and to carry out its obligations under all of the Agreements, and the Lessee has, concurrently with the execution hereof, duly authorized and executed all of the Agreements. The Agreements constitute legal, valid and binding obligations of the Lessee, enforceable in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles affecting the rights of creditors generally.
(c) No Defaults Neither the execution and delivery of the Agreements, nor the fulfillment of or compliance with the terms and conditions hereof or thereof, nor the consummation of the transactions contemplated hereby or thereby, conflicts with or results in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Lessee is now a party or by which the Lessee is bound, or constitutes a default under any of the foregoing, or results in the creation or imposition of any prohibited lien, charge or encumbrances whatsoever upon any of the property or assets of the Lessee. (d) Indemnification of Lessor The Lessee covenants to indemnify and hold harmless the Lessor and its directors and employees, and the Assignee, and with regard to its own rights (each, an “Indemnified Party”), against any and all losses, claims, damages or liabilities, joint or several, to which such Indemnified Party may become subject under any statute or at law or in equity or otherwise in connection with the transactions contemplated by this Lease, and shall reimburse any such Indemnified Party for any legal or other expenses incurred by it in connection

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6 with investigating any claims against it and defending any actions, insofar as such losses, claims, damages, liabilities or actions arise out of the transactions contemplated by this Lease. (e) Execution and Delivery The Lessee has taken all actions required to authorize and execute this Lease in accordance with the Constitution and laws of the State. (f) Financial Condition The Lessee has experienced no material change in its financial condition since June 30, 2021.
(g) No Litigation There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, governmental agency, public board or body, pending or, to the best of its knowledge, threatened against the Lessee in any way contesting or affecting the validity or enforceability of this Lease or the Site Lease or contesting the powers of the Lessee to execute and deliver this Lease or the Site Lease or to consummate the transactions contemplated hereby or thereby.
(h) Essentiality of the Leased Property The Leased Property is essential to the operations of the Lessee.
(i) Leased Property To the best of the City’s knowledge, the Leased Property complies with all material applicable restrictive covenants, zoning ordinances, building laws and other applicable laws (including without limitation, the Americans with Disabilities Act, as amended).

The Lessee is the owner in fee of title to the Leased Property. No lien or encumbrance on the Leased Property materially impairs the Lessee’s use of the Leased Property for the purposes for which it is, or may reasonably be expected to be, held. The Leased Property is not located in a flood hazard area.
(j) Compliance with Laws and Regulations
(1) The Lessee has, after due inquiry, no knowledge and has not given or received any written notice indicating that the Leased Property or the past or present use thereof or any practice, procedure or policy employed by it in the conduct of its business materially violates any applicable law, regulation, code, order, rule, judgment or consent agreement, including, without limitation, those relating to zoning, building, use and occupancy, fire safety, health sanitation, air pollution, ecological matters, environmental protection, hazardous or toxic materials, substances or wastes, conservation, parking, architectural barriers to the handicapped, or restrictive covenants or other agreements affecting title to the Leased Property (collectively, “Laws and Regulations”). Without limiting the generality of the foregoing, neither the Lessee nor to the best of its knowledge, after due inquiry, any prior or present owner, tenant or subtenant of any of the Leased Property has, other than as set forth in subsections (a) and (b) of this Section or as may have been remediated in accordance with Laws and Regulations, (i) used, treated, stored, transported or disposed of any material amount of flammable explosives, polychlorinated biphenyl compounds, heavy metals, chlorinated solvents, cyanide, radon, petroleum products, asbestos or any Asbestos Containing Materials, methane, radioactive materials, pollutants, hazardous materials, hazardous wastes, hazardous, toxic, or regulated substances or related materials, as defined in CERCLA, RCRA, CWA, CAA, TSCA and

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7 Title III, and the regulations promulgated pursuant thereto, and in all other Environmental Regulations applicable to the Lessee, any of the Leased Property or the business operations conducted by the Lessee thereon (collectively, “Hazardous Materials”) on, from or beneath its Leased Property, (ii) pumped, spilled, leaked, disposed of, emptied, discharged or released (hereinafter collectively referred to as “Release”) any material amount of Hazardous Material on, from or beneath the Leased Property, or (iii) stored any material amount of petroleum products at the Leased Property in underground storage tanks. (2) Excluded from the representations and warranties in subsection (1) hereof with respect to Hazardous Materials are those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city facility, the use, treatment, storage, transportation and disposal of which has been and shall be in compliance with all Laws and Regulations.
(3) No Leased Property located in an area of high potential incidence of radon has an unventilated basement or subsurface portion which is occupied or used for any purpose other than the foundation or support of the improvements to such Leased Property. (k) Environmental Compliance
(1) The Lessee shall not use or permit the Leased Property or any part thereof to be used to generate, manufacture, refine, treat, store, handle, transport or dispose of, transfer, produce or process Hazardous Materials, except, and only to the extent, if necessary to maintain the improvements on the Leased Property and then, only in compliance with all Environmental Regulations, and any state equivalent laws and regulations, nor shall it permit, as a result of any intentional or unintentional act or omission on its part or by any tenant, subtenant, licensee, guest, invitee, contractor, employee and agent, the storage, transportation, disposal or use of Hazardous Materials or the Release or threat of Release of Hazardous Materials on, from or beneath the Leased Property or onto any other property excluding, however, those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city facility, the use, storage, treatment, transportation and disposal of which shall be in compliance with all Environmental Regulations. Upon the occurrence of any Release or threat of Release of Hazardous Materials, the Lessee shall promptly commence and perform, or cause to be commenced and performed promptly, without cost to the Lessor, all investigations, studies, sampling and testing, and all remedial, removal and other actions necessary to clean up and remove all Hazardous Materials so released, on, from or beneath the Leased Property or other property, in compliance with all Environmental Regulations. Notwithstanding anything to the contrary contained herein, underground storage tanks shall only be permitted subject to compliance with subsection (4) hereof and only to the extent necessary to maintain the improvements on the Leased Property.
(2) The Lessee shall comply with, and shall use its best efforts to ensure that any tenant’s subtenants, licensees, employees, contractors, and agents to comply with, all Environmental Regulations and shall keep the Leased Property free and clear from Hazardous Materials; provided, however, that notwithstanding that a portion of this covenant is limited to the Lessee’s use of its best efforts, the Lessee shall remain solely

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8 responsible for ensuring such compliance and such limitation shall not diminish or affect in any way the Lessee’s obligations contained in subsection (3) hereof. Upon receipt of any notice from any Person with regard to the Release of Hazardous Materials on, from or beneath the Leased Property, the Lessee shall give prompt written notice thereof to the Lessor (and, in any event, prior to the expiration of any period in which to respond to such notice under any Environmental Regulation).
(3) Irrespective of whether any representation or warranty contained herein is not true or correct, the Lessee shall defend, indemnify and hold harmless the Assignee, its partners and each of its and their employees, agents, officers, directors, trustees, successors and assigns, from and against any claims, demands, penalties, fines, attorneys’ fees (including, without limitation, attorneys’ fees incurred to enforce the indemnification contained in this Section, consultants’ fees, investigation and laboratory fees, liabilities, settlements (five (5) Business Days’ prior notice of which the Lessor, Assignee shall have delivered to the Lessee), court costs, damages, losses, costs or expenses of whatever kind or nature, known or unknown, contingent or otherwise, occurring in whole or in part, arising out of, or in any way related to, (i) the presence, disposal, Release, threat of Release, removal, discharge, storage or transportation of any Hazardous Materials on, from or beneath the Leased Property, (ii) any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to such Hazardous Materials, (iii) any lawsuit brought or threatened, settlement reached (five (5) Business Days’ prior notice of which the Lessor, the Assignee shall have delivered to the Lessee), or governmental order relating to Hazardous Materials on, from or beneath any of the Leased Property, (iv) any violation of Environmental Regulations or subsection (1) or (2) hereof by it or any of its agents, tenants, employees, contractors, licensees, guests, subtenants or invitees, and (v) the imposition of any governmental lien for the recovery of environmental cleanup or removal costs. To the extent that the Lessee is strictly liable under any Environmental Regulation, its obligation to the Assignee, and the other indemnities under the foregoing indemnification shall likewise be without regard to fault on its part with respect to the violation of any Environmental Regulation which results in liability to any indemnitee. Its obligations and liabilities under this subsection (3) shall survive any foreclosure of the leasehold interest in the Leased Property or the delivery of any instrument in lieu of foreclosure of such leasehold interest, and satisfaction of the Lease Payments due hereunder.
(4) The Lessee shall conform to and carry out a reasonable program of maintenance and inspection of all underground storage tanks, and shall maintain, repair, and replace such tanks only in accordance with Laws and Regulations, including but not limited to Environmental Regulations.
(l) No Condemnation The Lessee hereby covenants and agrees, to the extent it may lawfully do so, that as long as any of the Lease Payments or Additional Payments remain outstanding and unpaid, the Lessee will not exercise the power of condemnation with respect to the Leased Property. The Lessee further covenants and agrees, to the extent it may lawfully do so, that if for any reason the foregoing covenant is determined to be unenforceable or if the Lessee should fail or refuse to abide by such covenant and condemns the Leased Property, the appraised value of the Leased Property shall not be less than the greater of (i) if such Lease Payments are

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9 then subject to prepayment, or (ii) if this Lease is not then subject to prepayment, the amount necessary to defease this Lease.
(m) Appropriated The City has never non-appropriated or defaulted under any of its payment or performance obligations or covenants, either under any financing lease of the same general nature as this Lease Agreement, or under any of its bonds, notes, or other debt obligations. (n) Lease Payments The City reasonably believes that sufficient funds can be obtained to make all Lease Payments and all other amounts required to be paid pursuant to this Lease Agreement.

SECTION 2.2 Representations, Covenants and Warranties of Lessor The Lessor represents, covenants and warrants to the Lessee as follows:
(a) Due Organization and Existence; Enforceability The Lessor is a joint powers authority duly organized and existing under the laws of the State, and has the power to enter into the Site Lease, this Lease and the Assignment Agreement; is possessed of full power to own and hold real and personal property, and to lease and sell the same; and has duly authorized the execution and delivery of all of the aforesaid agreements. The Site Lease, this Lease and the Assignment Agreement constitute the legal, valid and binding obligations of the Lessor, enforceable in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles affecting the rights of creditors generally.
(b) No Encumbrances The Lessor will not pledge or assign the Lease Payments or other amounts derived from the Leased Property and from its other rights under this Lease except the Lessor may create, assume or suffer to exist Permitted Encumbrances provided under the terms of this Lease.
(c) No Violations Neither the execution and delivery of the Site Lease, this Lease and the Assignment Agreement, nor the fulfillment of or compliance with the terms and conditions hereof or thereof, nor the consummation of the transactions contemplated hereby or thereby, conflicts with or results in a breach of the terms, conditions or provisions of the Joint Exercise of Powers Agreement creating the Lessor or any restriction or any agreement or instrument to which the Lessor is now a party or by which the Lessor is bound, or constitutes a default under any of the foregoing. Unless otherwise agreed to in writing by the Assignee no lien on the Leased Property (except laborers’ and mechanics’ liens) senior to the lien established hereby shall be permitted. (d) No Assignment Except as provided herein, in the Assignment Agreement and in this Lease, the Lessor will not assign this Lease, its right to receive Lease Payments from the Lessee, or its duties and obligations hereunder to any other person, firm or corporation so as to impair or violate the representations, covenants and warranties contained in this Section; provided, however, that Lessor shall, with the prior written consent of the Assignee, have the absolute right to assign this Lease and its rights and obligations hereunder to any other such person, firm or corporation.
(e) Execution and Delivery The Lessor has duly authorized and executed this Lease and the Site Lease in accordance with the Constitution and laws of the State.

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10 (f) No Litigation There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, governmental agency, public board or body, pending or, to the best of its knowledge, threatened against the Lessor in any way contesting or affecting the validity or enforceability of this Lease or the Site Lease or contesting the powers of the Lessor to execute and deliver this Lease or the Site Lease or to consummate the transactions contemplated hereby or thereby.
(g) Cooperation The Lessor shall cooperate fully with the Lessee at the expense of the Lessee in filing any proof of loss with respect to any insurance policy maintained pursuant to Article V of this Lease and shall cooperate fully with the Lessee in contesting any lien filed or established against the Leased Property, upon the request and at the expense of the Lessee pursuant to Article V of this Lease.
(h) Municipal Advisor Rules The Lessor is not acting as an advisor to the Lessee, including, without limitation, as a “Municipal Advisor” as such term is defined in the Municipal Advisor Rules, or an agent or a fiduciary of the Lessee and the Lessor has not provided any advice or assumed any advisory or fiduciary responsibility in favor of the Lessee with respect to the transaction contemplated hereby or by the Site Lease and the discussions, undertakings and procedures leading thereto.

ARTICLE III

DEPOSIT AND APPLICATION OF FUNDS
SECTION 3.1 Deposit of and Application of Funds On the Closing Date, the Assignee shall cause the following amounts derived from amounts paid by the Assignee under the Assignment Agreement to be transferred:
(a) $_________ to CalPERS for the account of the Lessee, as follows -- [insert CalPERS payoff wire instructions]
(b) $________ to U.S. Bank Trust National Association, as fiscal agent, to pay all Costs of Issuance.

SECTION 3.2 Leased Property The Leased Property is the subject of the Site Lease and shall be deemed to be and is subleased under this Lease. The Lessee has leased the Leased Property to the Lessor in consideration, in part, for the Lessor’s promise to cause the acquisition, delivery, installation, equipping, remodeling or construction of the Leased Property.

SECTION 3.3 Lessee to Act as Agent for the Lessor
(a) Each item to be leased hereunder as a part of the Leased Property is of a category eligible for leasing by the Lessee. The Lessor shall not be accountable for the acts of the Lessee as its agent hereunder and the Lessee hereby assumes total responsibility for the performance of its duties hereunder.

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11 (b) The Lessee, for One Dollar ($1.00) and other good and valuable consideration in hand received, does hereby accept the appointment as agent of the Lessor for the purposes set forth in this Section.

SECTION 3.4 Reserved
SECTION 3.5 Substitution of Alternate Leased Property and Release of Leased Property
(a) With the prior written consent of the Assignee, the Lessee shall have the right to release or to substitute alternate property for the Leased Property provided for in Exhibit B hereto, or add additional real property and/or personal property and/or equipment to the Leased Property, but only by providing the Assignee with a duly recorded amendment or supplement to this Lease in accordance herewith. All costs and expenses incurred in connection with any such substitution or addition shall be borne by the Lessee. Notwithstanding any substitution or addition pursuant to this Section, there shall be no reduction in or abatement of the Lease Payments due from the Lessee hereunder as a result of such substitution.
(b) If the Lessee substitutes any alternate real property, or equipment, as applicable, or Improvement for the Leased Property or adds additional components to the Leased Property, written notice of such substitution or addition shall be delivered by the Lessee and to the Lessor and the Assignee. The Lessee shall not substitute alternate real property or equipment, as applicable, or Improvements for the Leased Property or add an additional component to the Leased Property, without first obtaining a certificate of the Lessee (A) stating that the annual fair rental value of the Leased Property after the Substitution or Removal, in each year during the remaining term of this Lease, is at least equal to the maximum annual Lease Payments during the remaining term of the Lease, (B) demonstrating that the useful life of the Leased Property after Substitution or Removal equals or exceeds the remaining term of this Lease, and (C) stating that the Leased Property after a Substitution or Removal is as essential to the operations of the Lessee as was the Leased Property immediately prior to such Substitution or Removal. (c) In the event of a Substitution or Removal, there shall also be delivered to the Lessor and the Assignee (i) a policy of title insurance in an amount equal to the same proportion of the principal amount as the Principal Components of the Lease Payments attributable to the remaining portion of the real property portion of the Leased Property or the Substituted Leased Property bears to the total Principal Components of Lease Payments, insuring the Lessee’s leasehold interest in the Substituted Leased Property (except any portion thereof which is not real property) subject only to Permitted Encumbrances, together with an endorsement thereto making such policy payable to the Assignee and relating to this Lease and evidence that no prior liens exist with respect to such Substituted Leased Property subject only to Permitted Encumbrances, and (ii) in the event of a partial Removal, evidence that the title insurance in effect immediately prior thereto is not affected.

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12 ARTICLE IV
AGREEMENT TO LEASE; TERMINATION OF
LEASE; LEASE PAYMENTS; TITLE TO THE LEASED PROPERTY
SECTION 4.1 Lease The Lessor hereby leases the Leased Property to the Lessee, and the Lessee hereby leases the Leased Property from the Lessor, upon the terms and conditions set forth in this Lease.

SECTION 4.2 Term of Agreement The “Term” of this Lease shall mean the duration of this Lease for the Leased Property, which shall commence on the Closing Date and shall terminate on _______ 1, 20__, unless earlier terminated in accordance with the following paragraph, provided, however that if Lease Payments remain unpaid at the expiration of the Lease Term, or provision shall not have been made for their payment, then this Lease shall not terminate until the earlier of (i) _____ 1, 20__ or the expiration of the term of the Lease in the event this Lease shall have been amended pursuant to Article VIII, Section 8.3 hereof, unless such term is sooner terminated as hereinafter provided; and, provided further, however, that there shall be terminated with respect to the Leased Property, the entirety of Lessor’s interest which is transferred to the Lessee upon the end of the useful life of the Leased Property in the same manner, as provided in Article IV, Section 4.5(b) with respect to the transfer of the Leased Property at the end of the Term. The Term of this Lease shall in no event be extended beyond the maximum period permitted by law.

The Term of this Lease shall end upon the earliest of any of the following events: (a) a default by the Lessee and the Lessor’s subsequent election to terminate this Lease under Article IX, Section 9.2(b); (b) the payment by the Lessee of all Lease Payments required under Article IV, Section 4.3 hereof and any Additional Payments required under Article IV, Section 4.6 hereof; (c) the deposit of moneys or Defeasance Obligations with the Authority or escrow agent appointed by the Authority in amounts sufficient to pay all of the Lease Payments as the same shall become due, as provided by Article X, Section 10.1 hereof; or (d) upon the exercise by the Lessee of its option to purchase the entire interest of the Lessor in the Leased Property as provided in Article IV, Section 4.5(c) hereof and payment of all amounts provided for hereunder.

SECTION 4.3 Lease Payments
(a) Obligation to Pay
(1) Time and Amount Subject to the provisions of Article VI and Article X hereof, the Lessee agrees to pay to the Lessor, its successors and assigns, as rental for the use and possession of the Leased Property, the Lease Payments in the amounts specified in Exhibit A hereto, to be due and payable on each Lease Payment Date.

Lease Payments shall be paid from any source of legally available funds of the Lessee, and so long as the Leased Property, or a sufficient portion thereof, is available for the use, the Lessee covenants to take such action as may be necessary to include all Lease Payments due hereunder in its budgets and to make the necessary appropriations for all such Lease Payments and Additional Payments.

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13 During the Term hereof, the Lessee will furnish to the Assignee upon request, no later than twenty (20) days following the adoption of the budget for its thencurrent fiscal year, and prior to the beginning of the fiscal year, a certificate of the Authorized Representative to the effect that amounts stated in the Lessee’s proposed annual budget for the payment of Lease Payments due under this Lease in the fiscal year covered by such budget and approved by the Governing Board are fully adequate for the payment of all Lease Payments due under this Lease in such fiscal year. The covenants on the part of the Lessee herein contained shall be deemed to be and shall be construed to be duties imposed by law and it shall be the duty of each and every public official of the Lessee to take such action and do such things as are required by law in the performance of the official duty of such officials to enable the Lessee to carry out and perform the covenants and agreements in this Lease agreed to be carried out and performed by the Lessee. (2) No Withholding Notwithstanding any dispute between the Lessor and the Lessee, including any dispute as to the failure of any Leased Property Component to perform the task for which it is leased, the Lessee shall make all Lease Payments when due and shall not withhold any Lease Payments pending the final resolution of such dispute. (b) Terms and Effect of Prepayment and Purchase of the Leased Property (1) Optional Prepayment The Lessee shall have the option to prepay in whole on any Interest Payment Date the then unpaid Principal Components of its Lease Payments due at the prepayment prices set forth below, plus accrued interest on such unpaid Principal Component of Lease Payments to the date of prepayment.

Prepayment Date
Prepayment
Price
July 1, 2022 through and including May 1, 2024 103%
November 1, 2024 through and including May 1, 2026 102
November 1, 2026 through and including May 1, 2028 101
November 1, 2028 and thereafter 100
[Any partial principal prepayment reduces the outstanding principal balance and interest accrual, but does not re-amortize principal payments.] (2) In Whole; Exercise of Purchase Option If the Lessee exercises its option to purchase the entire interest of the Lessor in the Leased Property in accordance with Article IV, Section 4.5(c) hereof by prepaying all remaining Lease Payments either by irrevocably making a security deposit with the Assignee as provided in Article X, Section 10.1 hereof or from Net Insurance and Condemnation Proceeds as provided in Article X, Section 10.2 hereof, the Lessee’s obligations under this Lease shall thereupon cease and terminate, including but not limited to the Lessee’s obligations to continue to pay Lease Payments under this Section.

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14 (3) In Part If the Lessee prepays less than all of the remaining Principal Components of the Lease Payments pursuant to this Section or from Net Insurance and Condemnation Proceeds pursuant to Article X, Section 10.2 hereof, or pursuant to Article X, Section 10.3 hereof, the amount of such prepayment shall be applied proportionately over the remaining Term to reduce the Principal Components of the Lease Payments. Upon prepayment the Authorized Representative of the Lessee shall prepare (or cause to be prepared) a revised schedule of Lease Payments which schedule shall take into account such prepayment and shall be and become for all purposes thereafter Exhibit A attached hereto.
(4) Notice and Timing of Prepayment Before making any prepayment hereunder, the Lessee shall give written notice to the Lessor and the Assignee describing such event and specifying the date on which the prepayment will be made, which notice shall be given no later than the thirtieth (30th) day prior to the date scheduled for prepayment.
(c) Rate of Overdue Payments If Lessee should fail to make any of the payments required in this Section, the payments in default shall continue as an obligation of the Lessee until the amount in default shall have been fully paid, and the Lessee agrees to pay the same with interest at the Default Rate, to the extent permitted by law, from the date such amount was originally payable.
(d) Fair Rental Value The Lease Payments shall be paid by the Lessee in consideration of the right of possession of, and the continued quiet use and enjoyment of, the Leased Property during each such period for which such payments have been paid. The parties hereto have agreed and determined that such payments represent at least the fair rental value of the Leased Property.

In making such determination, consideration has been given to the obligations of the parties under this Lease (including but not limited to costs of maintenance, taxes and insurance), the uses and purposes which may be served by the Leased Property and the benefits therefrom which will accrue to the Lessee and the general public.
(e) Assignment The Lessee understands and agrees that, pursuant to the Assignment Agreement, the Lessor has assigned its right to receive and collect Lease Payments, Additional Payments and prepayments thereof to the Assignee, and the Lessee assents to such assignment.

The Lessor hereby directs the Lessee, and the Lessee hereby agrees to pay to the Assignee at such other place as the Assignee shall direct in writing, all payments payable by the Lessee pursuant to this Section, Article IV, Section 4.6 and Article X hereof. (f) Abatement Lease Payments shall be subject to abatement as provided in Article VI, Section 6.1 hereof.

SECTION 4.4 Quiet Enjoyment During the term of this Lease, the Lessor shall provide the Lessee with quiet use and enjoyment of the Leased Property, and the Lessee shall during such term peaceably and quietly have and hold and enjoy the Leased Property, without suit, trouble or hindrance from the Lessor, or any person or entity claiming under or through the Lessor except as expressly set forth in this Lease. The Lessor shall, at the request and expense of the Lessee, join in any legal action in which the Lessee asserts its right to such possession and enjoyment to the

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15 extent the Lessor may lawfully do so. Notwithstanding the foregoing, the Lessor shall have the right to inspect the Leased Property as provided in Article VII, Section 7.3 hereof.

SECTION 4.5 Title to the Leased Property
(a) Lessor Holds Leasehold Interest During Term During the term of this Lease, the Lessor shall hold a leasehold interest in the Leased Property, and each discrete portion thereof, and any and all additions which comprise repairs, replacements or modifications thereto. The Lessee shall take any and all actions, including but not limited to executing and filing any and all documents, reasonably required to maintain and evidence the Lessor’s interest in the Leased Property at all times during the Term of this Lease.
(b) Title Transferred to Lessee at End of Term Upon expiration of the Term as set forth in Article IV, Section 4.2 herein, unless such expiration occurs pursuant to a default by the Lessee and the Lessor has elected to terminate this Lease under Article IX, Section 9.2(b) hereof, all right, title and interest of the Lessor in and to all of the Leased Property shall be transferred to and vest in the Lessee, without the necessity of any additional document of transfer, except that with respect to the Leased Property Component constituting real property, the Lessor shall authorize, execute and deliver to the Lessee any documents required to transfer all right, title and interest of the Lessor to such real property to the Lessee. (c) Option to Purchase The Lessee shall have the option to purchase the entire interest of the Lessor in the Leased Property by irrevocably making a security deposit as provided in Article X by paying the purchase price therefor in the form of moneys or Defeasance Obligations, or a combination thereof, in an aggregate amount sufficient to provide for the payment of all of the total Lease Payments, as and when due, taking into account investment income to be earned on the deposit of such moneys and investments whereupon all right, title and interest of the Lessor in and to the Leased Property shall vest in the Lessee without the necessity of any additional document of transfer. In any such event, if necessary, the Lessor shall authorize, execute and deliver to the Lessee any documents reasonably requested by the Lessee to terminate this Lease in order to confirm such vesting of title in the Lessee.

SECTION 4.6 Additional Payments As Additional Payments, the Lessee shall also pay such amounts as shall be required for the payment of all administrative costs of the Lessor relating to the Leased Property, including, without limitation, the Lessee’s obligation to pay all taxes of any sort whatsoever payable by the Lessor as a result of its ownership of the Leased Property or its undertaking of the transactions contemplated herein or, as may be related to this Lease, fees of auditors, accountants, attorneys or engineers, insurance premiums, credit enhancement fees, and all other necessary administrative costs of the Lessor or charges required to be paid by it in order to maintain its existence or to comply with the terms of the this Lease or to defend the Lessor.

Such Additional Payments shall be billed to the Lessee by the Lessor from time to time, together with a statement certifying that the amount billed has been paid by the Lessor for one or more of the items above described, or that such amount is then payable by the Lessor within fifteen (15) days after receipt of the bill by the Lessee. Additional Payments due under this Section shall be paid by the Lessee directly to the person or persons to whom such amounts shall be payable.

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16 ARTICLE V
MAINTENANCE; TAXES; INSURANCE; OTHER MATTERS
SECTION 5.1 Maintenance, Utilities, Taxes and Assessments Throughout the Term of this Lease, as part of the consideration for the rental of the Leased Property, all repair and maintenance of the Leased Property shall be the responsibility of the Lessee, and the Lessee shall pay for or otherwise arrange for the payment of the cost of the repair and replacement of the Leased Property resulting from ordinary wear and tear or want of care on the part of the Lessee or any sublessee thereof. In exchange for the Lease Payments herein provided, the Lessor agrees to provide only the Leased Property, as hereinbefore more specifically set forth. The Lessor shall have no responsibility for making improvements and additions to the Leased Property other than as set forth herein. The Lessee shall also pay or cause to be paid any and all sales taxes or other taxes, levies, charges, withholdings, assessments and governmental charges of any nature whatsoever, together with any additions to tax, penalties, fines or interest thereon charged against the Leased Property, as Additional Payments under Article IV, Section 4.6 hereof, including, without limitation, penalties, fines or interest arising out of any delay or failure by the Lessee to pay any of the foregoing or failure to file or furnish to the Lessor for filing in a timely manner any returns, hereinafter levied or imposed against the Lessor or the Leased Property, the rentals and other payments required hereunder or any parts thereof or interests in the Lessee or the Lessor by any governmental authority.

SECTION 5.2 Modification of the Leased Property
(a) The Lessee shall, at its own expense, have the right to make additions, modifications, and improvements to the Leased Property if such improvements are necessary or beneficial for the use of the Leased Property. All such additions, modifications and improvements shall thereafter comprise part of the Leased Property and be subject to the provisions of this Lease.

Such additions, modifications and improvements shall not in any way damage the Leased Property or cause it to be used for purposes other than those authorized under the provisions of State and federal law or in any way which would impair the tax status of the Interest Components of the Lease Payments; and the Leased Property, upon completion of any additions, modifications and improvements made pursuant to this Section, shall be of a value in the aggregate which is not less than the value of the Leased Property immediately prior to the making of such additions, modifications and improvements.
(b) The Lessee will not permit any mechanic’s or other lien to be established or to remain against the Leased Property for labor or materials furnished in connection with any additions, modifications, remodeling, construction or improvements made by the Lessee pursuant to this Section, except Permitted Encumbrances; provided, that if any such lien is established and the Lessee shall first notify or cause to be notified the Lessor of the Lessee’s intention to do so, the Lessee may in good faith contest any lien filed or established against the Leased Property, and in such event may permit the liens so contested to remain undischarged and unsatisfied during the period of such contest and any appeal therefrom and shall provide the Lessor with full security against any loss or forfeiture which might arise from such nonpayment with respect to the Leased Property, in form satisfactory to the Lessor. The Lessor will cooperate fully in any such contest, upon the request and at the expense of the Lessee.

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17 SECTION 5.3 Public Liability and Property Damage Insurance; Workers’ Compensation Insurance
(a) Public Liability and Property Damage The Lessee shall maintain or cause to be maintained, throughout the Term of this Lease, a standard comprehensive general public liability and property damage insurance policy or policies in protection of the Lessee, its officers, agents and employees. Such policy or policies shall provide for indemnification of such parties against direct or contingent loss or liability for damages for bodily and personal injury, death or property damage occasioned by reason of the use or operation of the Leased Property.

Such policy or policies shall provide coverage in the minimum liability limits of $1,000,000 for personal injury or death of each person and $3,000,000 for personal injury or deaths of two or more persons in each accident or event, and in a minimum amount of $150,000 (subject to a deductible clause of not to exceed $50,000) for damage to property resulting from each accident or event. Such public liability and property damage insurance may, however, be in the form of a single limit policy in the amount of $3,000,000 covering all such risks. Such liability insurance may be maintained as part of or in conjunction with any other liability insurance coverage carried by the Lessee, and may be maintained in the form of self-insurance by the Lessee.

The Net Insurance and Condemnation Proceeds of such liability insurance shall be applied toward extinguishment or satisfaction of the liability with respect to which the insurance proceeds shall have been paid, including, where appropriate, the application of Net Insurance and Condemnation Proceeds with respect to the prepayment of the Lease Payments. Such liability insurance may be maintained as part of or in conjunction with any other liability insurance carried by the Lessee.

As an alternative to providing the insurance required by the first paragraph of this Section, the Lessee may provide a self-insurance method or plan of protection which shall afford reasonable protection to the Lessor, its directors, officers, agents and employees and the Assignee, in light of all circumstances, giving consideration to cost, availability and similar plans or methods of protection adopted by public entities in the State other than the Lessee. Before such method or plan may be provided by the Lessee, there shall be filed with the Assignee a certificate of an actuary, Insurance Consultant or other qualified person to the satisfaction of the Lessor, stating that, in the opinion of the signer, the substitute method or plan of protection, is in accordance with the requirements of this Section and, when effective, would afford reasonable protection to the Lessor, its directors, officers, agents and employees and the Assignee against loss and damage from the hazards and risks covered thereby and Assignee may conclusively rely thereon. There shall also be filed a certificate of the Lessee setting forth the details of such substitute method or plan. (b) Workers’ Compensation The Lessee shall also maintain or require (in the case of vendors or contractors and all subcontractors) throughout the Term of this Lease, workers’ compensation insurance issued by a responsible carrier authorized under the laws of the State covering all employees working on the Leased Property, in the same amount and type as other workers’ compensation insurance maintained by the Lessee for similar employees doing similar work (and the Lessee shall also require any other person or entity working on the Leased Property to carry the foregoing amount of workers’ compensation insurance). Workers’ compensation insurance may, to the extent provided by law, be maintained in the form of self-insurance.

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18 SECTION 5.4 Fire and Theft Insurance The Lessee shall maintain or cause to be maintained, throughout the Term of this Lease, insurance against loss or damage to any or all of the Leased Property by fire and lightning, with extended coverage endorsement (which extended coverage endorsement shall, as nearly as practicable, cover loss or damage by explosion, windstorm, riot, aircraft, vehicle damage, smoke and other hazards as are normally covered by such insurance), vandalism and malicious mischief insurance, sprinkler system leakage insurance, boiler insurance, and against loss of any of the Leased Property by theft.

Such insurance shall be in an amount equal to the greater of 100% of the replacement cost of the Leased Property (or, if under separate policies, in an aggregate amount equal to 100% of the replacement cost of the Leased Property) or the outstanding Principal Components of the Lease Payments, except that such insurance may be subject to deductible clauses of not to exceed $50,000 for any one loss; provided, however, that in no event shall such insurance be maintained in an aggregate amount less than the aggregate Principal Components of the Lease Payments at that time Outstanding. Such insurance may be maintained as part of or in conjunction with any other fire and extended coverage insurance carried or required to be carried by the Lessee and may be maintained in the form of self-insurance by the Lessee. The Net Insurance and Condemnation Proceeds of each policy or coverage shall be applied as provided in Article VI, Section 6.2(a) and (c).

SECTION 5.5 Rental Interruption and Title Insurance
(a) The Lessee shall maintain or cause to be maintained with a reputable commercial insurer throughout the Term of this Lease insurance against loss, total or partial, of the use and occupancy of the Leased Property as a result of any of the hazards covered by Article V, Section 5.4 hereof, in an amount not less than the maximum remaining scheduled Lease Payments for a 24-month period, except that such insurance need be maintained as to the peril of earthquake only if such insurance is available at reasonable cost on the open market from reputable insurance companies. Such insurance shall be subject to a deductible clause not to exceed $50,000. Such insurance may be maintained as part of or in conjunction with any other rental interruption insurance carried by the Lessee but may not be maintained as self-insurance. The Net Insurance and Condemnation Proceeds of such insurance shall be paid to the Lessor and shall be credited toward the payment of the Lease Payments in the order in which such Lease Payments come due and payable. The policy shall cover all components of the Leased Property and the facilities comprising the Leased Property.
(b) The Lessee shall, on or before the Closing Date, obtain a CLTA or an ALTA title insurance policy respecting the ownership and condition of the real property portion of the Leased Property as described in Exhibit B hereto, in an amount equal to the maximum aggregate amount of Principal Components of the Lease Payments.

SECTION 5.6 General Insurance Provisions
(a) Form of Policies All policies of insurance obtained under the requirements of this Lease and any statements of self-insurance shall be in forms certified by an insurance agent, broker or consultant to the Lessee to comply with the provisions hereof unless waived by the Assignee.

Any insurance policy obtained under the requirements of this Lease shall be issued by a

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19 commercial insurer rated at least “A” by S&P, and shall be written or endorsed to list the Assignee, the Lessor and the Lessee as additional named insureds and the Assignee as loss payee, with in all instances the net proceeds, if any, of the insurance policy described in Article V, Section 5.5(a) above to be deposited as directed by the Lessor, and each insurance policy provided for herein shall contain a provision to the effect that the insurance company shall not cancel the policy without first giving written notice thereof to the Assignee, the Lessor and the Lessee at least ten (10) days in advance of such intended cancellation; provided that, the Assignee shall not be responsible for the sufficiency of any insurance herein required and shall be fully protected in accepting payment on account of such insurance or any adjustments, compromise or settlement of any loss agreed to by it.
(b) Payment of Premiums The Lessee shall pay or cause to be paid when due the premiums for all insurance policies required by this Lease, and shall promptly furnish or cause to be furnished to the Assignee a certificate to such effect accompanied by evidence of such payments.
(c) Evidence of Insurance The Lessee will deliver to the Lessor and the Assignee by May 1 of each year, if requested, a certificate to the effect that the requirements of Article V, Sections 5.3, 5.4, 5.5 and 5.6 hereof have been satisfied, together with a certificate or certificates of an Insurance Consultant evidencing such satisfaction. Upon request, the Lessee shall provide a schedule, in such detail as the Lessor or the Assignee may reasonably request, setting forth any insurance policies then in force described in this Lease, listing the names of the insurers which have issued the policies, the policy limits thereof and the hazards and risks covered thereby, or the certificate of an Insurance Consultant providing similar information. The Assignee is entitled to rely on such certificates as to the Lessee’s compliance with these provisions and the Assignee has no further duties in that regard.
(d) Self-Insurance Requirements If the Lessee chooses to self-insure for any of the risks described in Article V, Sections 5.3 and 5.4 for which self-insurance is permitted, it must on at least an annual basis in the month of July provide evidence to the Assignee and the Lessor to the effect that (i) the Lessee has segregated amounts meeting such requirements in a special insurance reserve account dedicated to the Leased Property, (ii) a certificate of an Insurance Consultant to the Assignee and the Lessor to the effect that the Lessee’s general insurance reserves are adequate to provide the required amount of coverage, and (iii) an actuarial statement attesting to the sufficiency of the program’s assets. The Assignee may conclusively rely upon such certificates. The Lessee agrees that in the event the self-insurance program is discontinued, the actuarial soundness of the special insurance reserve account shall be maintained.

SECTION 5.7 Liens Except as provided in this Article (including without limitation Article V, Section 5.2(b)), the Lessee shall not, directly or indirectly, create, incur, assume or suffer to exist any mortgage, pledges, liens, charges, encumbrances or claims, as applicable, on or with respect to the Leased Property, or any portion thereof, other than the respective rights of the Lessor and the Lessee as herein provided and Permitted Encumbrances. Except as expressly provided in this Article, the Lessee shall promptly, at its own expense, take such action as may be necessary to duly discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim, for which it is responsible, if the same shall arise at any time. The Lessee shall reimburse the Lessor

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20 for any expense incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim.

SECTION 5.8 Use of the Leased Property The Lessee represents and warrants that it has or will, as of the Closing Date, have an immediate need for, and expects to make immediate use of the Leased Property, which need is not temporary or expected to diminish in the foreseeable future. The Lessee agrees not to give priority in the appropriation of funds for the construction, acquisition or use of any additional Equipment or facilities, as the case may be, performing functions similar to that performed by the Leased Property.

SECTION 5.9 Advances If the Lessee shall fail to perform any of its obligations under this Article, the Lessor may, but shall not be obligated to, take such action as may be necessary to cure such failure.

SECTION 5.10 Agreement to Pay Program Expenses The Lessee agrees to pay to the Assignee, as the assignee of the Lessor, all Program Expenses of the Lessor charged to the Lessee and Program Expenses charged to the Lessee by the Assignee.

SECTION 5.11 Books and Records The Lessee will at all times during the Term of this Lease keep proper books of record and account in which full, true and correct entries in conformity with applicable law shall be made of all dealings and transactions in relation to its activities. The Lessee will permit the Lessor, any authorized representatives of the Lessor and the Lessor’s successors and assigns at reasonable times and intervals upon prior written notice to examine and make abstracts, subject to proprietary and confidentiality policies and agreements of or binding upon the Lessee, from the Lessee’s books and records and to discuss the Lessee’s affairs, finances and account with the Lessee’s officers and independent accountants. The Lessee will promptly notify the Lessor if at any time the Lessee shall not maintain a positive fund balance in its general fund.

ARTICLE VI
DAMAGE AND DESTRUCTION; USE OF NET INSURANCE

AND CONDEMNATION PROCEEDS
SECTION 6.1 Abatement of Lease Payments in Event of Loss of Use A proportional amount of the Lease Payments shall be abated during any period in which, by reason of condemnation, damage or destruction, there is substantial interference with the use and possession of the Leased Property, or any discrete portion thereof, by the Lessee. The amount of such abatement shall be determined by the Lessee such that the resulting Lease Payments represent fair consideration for the use and possession of the portion of the Leased Property not condemned, damaged or destroyed. Such abatement shall commence on the date of condemnation, damage or destruction and shall end with the substantial completion of the replacement or work of repair.

There shall be no abatement in Lease Payments as a result of any design defects other than design defects that result in condemnation, damage or destruction with regard to the Leased Property, it being the intention of the parties hereto that recourse in such event would be made to the contractor or vendor. Except as provided herein, in the event of any such condemnation, damage or destruction, this Lease shall continue in full force and effect and the Lessee waives any right to

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21 terminate this Lease by virtue of any such condemnation, damage or destruction, including any rights otherwise granted under California Civil Code Sections 1932(2) and 1933(4).

SECTION 6.2 Application of Net Insurance and Condemnation Proceeds (a) From Insurance Award.
(1) Net Insurance and Condemnation Proceeds shall be deposited by the Lessee promptly upon receipt thereof in a special fund with the Assignee designated as the “Net Insurance and Condemnation Proceeds Fund.”
(2) Within ninety (90) days following the date of such deposit, the Lessee shall determine and notify the Lessor and the Assignee in writing of its determination either (a) that the replacement, repair, restoration, modification or improvement of the Leased Property is not economically feasible or in the best interest of the Lessee and the Net Insurance and Condemnation Proceeds, together with other moneys available therefor, are sufficient to cause the prepayment of the principal components of all unpaid Lease Payments hereunder, or (b) that all or a portion of such Net Insurance and Condemnation Proceeds are to be applied to the prompt replacement, repair, restoration, modification or improvement of the damaged or destroyed portions of the Leased Property and the fair rental value of the Leased Property following such repair, restoration, replacement, modification or improvement will at least equal the unpaid principal component of the Lease Payments.
(3) In the event the Lessee’s determination is as set forth in clause (a) of subparagraph (2) above, such Net Insurance and Condemnation Proceeds shall be promptly applied to the prepayment of the unpaid principal component of the Lease Payments and other amounts pursuant to this Lease; provided, however, that in the event of damage or destruction of the Leased Property in full, such Net Insurance and Condemnation Proceeds may be so applied only if sufficient, together with other moneys available therefor, to cause the prepayment of the principal components of all unpaid Lease Payments, all accrued and unpaid interest, and all other costs related to such prepayments pursuant to this Lease and otherwise such Net Insurance and Condemnation Proceeds shall be applied to the prompt replacement, repair, restoration, modification or improvement of the Leased Property; provided further, however, that in the event of damage or destruction of the Leased Property in part, such Net Insurance and Condemnation Proceeds may be applied to the prepayment of the unpaid principal component of the Lease Payments only if the resulting Lease Payments following such prepayment from Net Insurance and Condemnation Proceeds represent fair consideration for the remaining portions of the Leased Property and otherwise such Net Insurance and Condemnation Proceeds shall be applied to the prompt replacement, repair, restoration, modification or improvement of the Leased Property, evidenced by a certificate signed by an Authorized Representative. (4) In the event the Lessee’s determination is as set forth in clause (b) of subparagraph (ii) above, such Net Insurance and Condemnation Proceeds shall be applied to the prompt replacement, repair, restoration, modification or improvement of the damaged or destroyed portions of the Leased Property by the Lessee, and until the Leased

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22 Property has been restored to its prior condition, the Lessee shall not place any lien or encumbrance on the Leased Property that is senior to this Lease Agreement without the prior written consent of the Assignee, at its sole discretion. (b) From Title Insurance. The Net Insurance and Condemnation Proceeds from a title insurance award shall be deposited by the Lessee in the Net Insurance and Condemnation Proceeds Fund and credited towards the prepayment of Lease Payments as provided hereunder.

SECTION 6.3 Laws and Ordinances The Lessee agrees to observe and comply with all rules, regulations and laws applicable to the Lessee with respect to the Leased Property and the operation thereof. The cost, if any, of such observance and compliance shall be borne by the Lessee, and the Lessor shall not be liable therefor. The Lessee agrees further to place, keep, use, maintain and operate the Leased Property in such a manner and condition as will provide for the safety of its agents, employees, invitees, subtenants, licensees and the public.

ARTICLE VII
DISCLAIMER OF WARRANTIES; ACCESS TO THE LEASED PROPERTY SECTION 7.1 Disclaimer of Warranties THE LESSOR AND ITS ASSIGNS MAKE

NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE

VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR ANY

PARTICULAR PURPOSE OR FITNESS FOR THE USE CONTEMPLATED BY THE LESSEE OF THE LEASED PROPERTY OR ANY LEASED PROPERTY COMPONENT. THE LESSEE

ACKNOWLEDGES THAT THE LESSOR IS NOT A MANUFACTURER OF ANY

EQUIPMENT COMPRISING THE LEASED PROPERTY OR A DEALER THEREIN, AND THE LESSEE IS LEASING THE LEASED PROPERTY COMPONENTS “AS-IS,” IT BEING

AGREED THAT ALL OF THE AFOREMENTIONED RISKS ARE TO BE BORNE BY THE LESSEE. In no event shall the Lessor or its assigns be liable for incidental, indirect, special or consequential damages, in connection with or arising out of this Lease or the Site Lease for the existence, furnishing, functioning or use and possession of the Leased Property. In no event shall the Lessor or its assignees be liable for any incidental, indirect, special or consequential damage in connection with or arising out of this Lease or the existence, furnishing, functioning or the use of any item or products provided for in this Lease.

SECTION 7.2 Lessee’s Right to Enforce Warranties The Lessor hereby irrevocably appoints the Lessee as its agent and attorney-in-fact during the term of this Lease, so long as the Lessee shall not be in default hereunder, to assert from time to time whatever claims and rights, including without limitation, warranty claims, claims for indemnification and claims for breach of any representations, respecting the Leased Property which the Lessor may have against any vendor or contractor. The Lessee’s sole remedy for the breach of any such warranty, indemnification or representation shall be against the vendor or contractor with respect thereto, and not against the Lessor, nor shall such matter have any effect whatsoever on the rights and obligations of the Lessor with respect to this Lease, including the right to receive full and timely Lease Payments and all other payments due hereunder. The Lessee shall be entitled to retain any and all amounts recovered as a result of the assertion of any such claims and rights. The Lessor shall, upon the Lessee’s request and at the Lessee’s expense, do all things and take all such actions as the Lessee may

NRF/105390540.5
23 request in connection with the assertion of any such claims and rights. The Lessee expressly acknowledges that the Lessor makes, and has made, no representation or warranties whatsoever as to the existence or availability of such warranties of the manufacturer or vendor or contractor.

SECTION 7.3 Access to the Leased Property The Lessee agrees that the Lessor, any Lessor Representative and the Lessor’s successors or assigns and the Assignee, shall have the right (but no duty) at all reasonable times to enter upon and to examine and inspect the Leased Property.

The Lessee further agrees that the Lessor, any Lessor Representative, and the Lessor’s successors or assigns shall have such rights of access to the Leased Property as may be reasonably necessary to cause the proper maintenance of the Leased Property in the event of failure by the Lessee to perform its obligations hereunder; provided, however, that the Lessor’s assigns shall have no duty to cause such proper maintenance.

SECTION 7.4 Release and Indemnification Covenants To the extent permitted by law, the Lessee shall and hereby agrees to indemnify and save the Lessor and the Assignee and their assigns, agents, officers, employees and servants harmless from and against all claims, losses and damages, including legal fees and expenses, arising out of (i) the use, maintenance, condition or management of, or from any work or thing done on the Leased Property by the Lessee, (ii) any breach or default on the part of the Lessee in the performance of any of its obligations under this Lease, (iii) any act or negligence of the Lessee or of any of its agents, contractors, servants, employees or licensees with respect to the Leased Property, or (iv) any act or negligence of any assignee or sublessee of the Lessee with respect to the Leased Property. No indemnification is made under this Section or elsewhere in this Lease for claims, losses or damages, including legal fees and expenses arising out of the willful misconduct or gross negligence, under this Lease by the Lessor, its officers, agents, employees, successors or assigns. For purposes of this indemnification, Leased Property includes any alternate Leased Property pursuant to the provisions hereof.

ARTICLE VIII

ASSIGNMENT, SUBLEASING AND AMENDMENT
SECTION 8.1 Assignment by the Lessor Certain of the Lessor’s rights under this Lease, including the right to receive and enforce payment of the Lease Payments to be made by the Lessee under this Lease, have been assigned to the Assignee, subject to certain exceptions, pursuant to the Assignment Agreement, to which assignment the Lessee hereby consents. The Lessor will not assign this Lease, its right to receive Lease Payments from the Lessee, or its duties and obligations hereunder to any other person, firm or corporation so as to impair or violate the representations, covenants and warranties contained in Article II, Section 2.2 hereof.

SECTION 8.2 Assignment and Subleasing by the Lessee This Lease may be assigned by the Lessee with the prior written consent of the Assignee. The Lessee may sublease the Leased Property, with the prior written consent of the Lessor, subject to all of the following conditions:
(i) this Lease and the obligation of the Lessee to make Lease Payments hereunder shall remain obligations of the Lessee;

NRF/105390540.5
24 (ii) the Lessee shall, within thirty (30) days after the delivery thereof, furnish or cause to be furnished to the Lessor and the Assignee a true and complete copy of such sublease;
(iii) no sublease by the Lessee shall cause the Leased Property to be used for a purpose other than a governmental or proprietary function authorized under the provisions of the laws of the State;
(iv) no sublease shall cause the Interest Component of the Lease Payments due with respect to the Leased Property to become subject to State personal income taxes, as evidenced by an opinion of Special Counsel; and (v) if this Lease is assigned by the Lessee, the obligation to make Lease Payments hereunder shall remain the obligation of the Lessee.

SECTION 8.3 Amendment Lessee will not alter, modify or cancel or agree or consent to alter, modify or cancel this Lease except to permit any substitution or release, pursuant to Article III, Section 3.6 hereof, or otherwise without the prior written consent of the Assignee.

ARTICLE IX

EVENTS OF DEFAULT AND REMEDIES
SECTION 9.1 Events of Default Defined The following shall be “events of default” under this Lease and the terms “events of default” and “default” shall mean, whenever they are used in this Lease, any one or more of the following events:
(i) Failure by the Lessee to pay any Lease Payment required to be paid hereunder immediately following each corresponding Lease Payment Date. (ii) Failure by the Lessee to observe and perform any covenant, condition or agreement on its part to be observed or performed herein, other than as referred to in clause (i) of this Section, for a period of (30) days after written notice specifying such failure and requesting that it be remedied has been given to the Lessee by the Lessor and the Assignee; provided, however, if the failure stated in the notice cannot be corrected within the applicable period, the Lessor or the Assignee, as the case may be, shall not unreasonably withhold their consent to an extension of up to sixty (60) days if corrective action is instituted by the Lessee within the applicable period and diligently pursued until the default is corrected.
(iii) The filing of a voluntary petition in bankruptcy by the Lessee, or the failure by the Lessee promptly to institute judicial proceedings to lift any execution, garnishment or attachment of such consequence as will materially impair its ability to carry on its operations, or the filing of a petition by the Lessee under the Federal Bankruptcy Code, or the adjudication of the Lessee as insolvent or as a bankrupt, or any assignment by the Lessee for the benefit of its creditors, or the application for, or consent to, the appointment of any receiver, trustee, custodian or similar officer by the Lessee or the entry by the Lessee into an agreement of composition with its creditors.

NRF/105390540.5
25 The Lessor’s failure to perform any of its obligations hereunder shall not be an event permitting the nonpayment of Lease Payments by the Lessee or the termination of this Lease by the Lessee.

SECTION 9.2 Remedies on Default
(a) Upon the occurrence and continuance of an event of default specified in Article IX, Section 9.1 above, the Lessor shall, only at the direction of the Assignee, proceed to:
(i) Protect and enforce this Lease by such judicial proceedings as the Lessor or its assignee shall deem most effectual, either by suit in equity or by action at law, whether for the specific performance of any covenant or agreement contained in this Lease, or in aid of the exercise of any power granted in this Lease, or to enforce any other legal or equitable right vested in the Lessor or its assignee by this Lease or by law; (ii) Take possession of the Leased Property and exclude the Lessee from using it until the default is cured, holding the Lessee liable for the Lease Payments and other amounts payable by the Lessee prior to such taking of the Leased Property under and pursuant to this Lease and curing of such default; or
(iii) Take whatever actions at law or in equity appear necessary or desirable to enforce its rights as the owner of the Leased Property, including termination of this Lease and the repossession, re-letting (in consultation with Special Counsel) or sale (in consultation with Special Counsel) of the Leased Property.

Any abatement of Lease Payments due to damage or destruction of any Leased Property will not constitute an event of default hereunder.

Notwithstanding anything herein to the contrary, there shall be no right under any circumstances to accelerate the Lease Payments or otherwise declare any Lease Payments not then in default to be immediately due and payable. After the occurrence of an event of default hereunder, the Lessee will surrender possession of the Leased Property to the Lessor, if requested to do so by the Lessor or the Assignee.
(b) No Termination: Repossession and Re-Lease on Behalf of Lessee In the event the Lessor, at the direction of the Assignee, does not elect to terminate this Lease in the manner hereinafter provided for, the Lessor with the consent of the Lessee, which consent is irrevocably given, may repossess the Leased Property and re-let it for the account of the Lessee, in which event the Lessee’s obligation under this Lease will continue to accrue from year to year in accordance with this Lease and the Lessee will continue to receive the value of the use of the Leased Property from year to year in the form of credits against its obligation to pay Lease Payments. The obligations of the Lessee shall remain the same as prior to such default to pay Lease Payments whether the Lessor re-enters or not. The Lessee agrees to and shall remain liable for the payment of all Lease Payments and the performance of all conditions contained herein and shall reimburse the Lessor for any deficiency arising out of the re-letting of the Leased Property, or, in the event the Lessor is unable to re-let the Leased Property, then for the full amount of all Lease Payments to the end of the term of this Lease, but such Lease Payments and/or deficiency shall be payable only at the same time and in the same manner as provided above for the payment of Lease

NRF/105390540.5
26 Payments hereunder, notwithstanding such repossession by the Lessor or any suit, brought by the Lessor for the purpose of effecting such repossession of the Leased Property or the exercise of any other remedy by the Lessor.

The Lessee hereby irrevocably appoints the Lessor as the agent and attorney-in-fact of the Lessee to repossess and re-let the Leased Property in the event of default by the Lessee in the performance of any covenants contained herein to be performed by the Lessee and to remove (any removal to be done with reasonable prudence) all personal property connected to or made a part of the Leased Property, to place such Property in storage or other suitable place in the County of Los Angeles, for the account of and at the expense of the Lessee, and the Lessee hereby exempts and agrees to save harmless the Lessor from any costs, loss or damage whatsoever arising or occasioned by any such repossession and re-letting of the Leased Property. The Lessee hereby waives any and all claims for damages caused or which may be caused by the Lessor in repossessing the Leased Property as provided herein and all claims for damages that may result from the destruction of or the injury to the Leased Property and all claims for damage to or loss of any property belonging to the Lessee that may be in or upon the Leased Property.

The Lessee agrees that the terms of this Lease constitute full and sufficient notice of the right of the Lessor to re-let the Leased Property in the event of such repossession without effecting a surrender of this Lease, and further agrees that no acts of the Lessor in effecting such re-letting shall constitute a surrender or termination of this Lease irrespective of the term for which such reletting is made or the terms and conditions of such re-letting or otherwise, but that, on the contrary, in the event of such default by the Lessee the right to terminate this Lease shall vest in the Lessor to be effected in the sole and exclusive manner provided for in subparagraph (c) below. The Lessee further waives the right to any rental obtained by the Lessor in excess of the Lease Payments and hereby conveys and releases such excess to the Lessor as compensation to the Lessor for its services in re-letting the Leased Property. If the liability of the Lessee under this subsection (b) is held to constitute indebtedness or liability in any year exceeding the income and revenue provided for such year, neither the Lessor nor the Assignee shall exercise the remedies provided in this subsection (b).
(c) Termination: Repossession and Re-Lease In the event of the termination of this Lease by the Lessor, at the direction of the Assignee, and in the manner hereinafter provided on account of default by the Lessee (and notwithstanding any repossession of the Leased Property by the Lessor in any manner whatsoever or the sale or re-letting of the Leased Property), the Lessee nevertheless agrees to pay to the Lessor all costs, losses or damages, but not Lease Payments, howsoever arising or occurring payable at the same time and in the same manner as is provided herein in the case of payment of Lease Payments. Unless waived by the Assignee, notwithstanding any other provision herein, following an event of default, the Assignee shall have the right to reenter and re-let the Leased Property and to terminate this Lease. Any proceeds of the re-letting of the Leased Property by the Lessor shall be applied to Lease Payments due and owing hereunder.

Any surplus received by the Lessor from such sale or re-letting shall be the absolute property of the Lessor and the Lessee shall have no right thereto, nor shall the Lessee be entitled to any credit in the event of a surplus in the rentals received by the Lessor for the Leased Property. Neither notice to pay rent or to deliver up possession of the Leased Property given pursuant to law nor any proceeding taken by the Lessor to recover possession of the Leased Property shall by itself operate to terminate this Lease, and no termination of this Lease on account of default by the Lessee shall

NRF/105390540.5
27 be or become effective by operation of law, or otherwise, unless and until the Lessor shall have given written notice to the Lessee of the election on the part of the Lessor to terminate this Lease.

The Lessee covenants and agrees that no surrender of the Leased Property or of the remainder of the term hereof or any termination of this Lease shall be valid in any manner or for any purpose whatsoever unless stated or accepted by the Lessor by such written notice. No such termination shall be effected whether by operation of law or acts of the parties hereto, except only in the manner herein expressly provided.

SECTION 9.3 No Remedy Exclusive No remedy conferred herein upon or reserved to the Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Lease or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give any notice, other than such notice as may be required in this Article or by law.

SECTION 9.4 Agreement to Pay Attorneys’ Fees and Expenses In the event either party to this Lease should default under any of the provisions hereof and the non-defaulting party should employ attorneys or incur other expenses for the collection of moneys or the enforcement of performance or observance of any obligation or agreement on the part of the defaulting party contained herein, the defaulting party agrees that it will on demand therefor pay to the nondefaulting party the reasonable fees of such attorneys and such other expenses so incurred by the non-defaulting party.

SECTION 9.5 No Additional Waiver Implied by One Waiver In the event any agreement contained in this Lease should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder.

ARTICLE X

PREPAYMENT OF LEASE PAYMENTS AND

PURCHASE OF LEASED PROPERTY
SECTION 10.1 Security Deposit Notwithstanding any other provision of this Lease, the Lessee may on any date exercise its option to purchase the entire leasehold interest of the Lessor in the Leased Property by an irrevocable deposit with the Authority or a fiduciary reasonably satisfactory to the Authority: (i) an amount of cash, which shall be held in a segregated trust or escrow fund under a trust or escrow agreement that is in form and content acceptable to the Authority, is sufficient to pay the Lessee’s unpaid Lease Payments, in accordance with the Lease Payment schedule set forth in Exhibit A hereto, or (ii) Defeasance Obligations together with cash, if required, in such amount as will, in the opinion of an independent certified public accountant (which opinion shall be addressed and delivered to the Lessor), together with interest to accrue thereon, and money then on deposit in a segregated trust or escrow fund under a trust or escrow agreement, together with interest thereon, be fully sufficient to pay all of the unpaid Lease Payments on the Lease Payment Dates or by prepayment thereof pursuant to Article X,

NRF/105390540.5
28 Section 10.2 hereto, as the Lessee shall instruct at the time of such deposit and be sufficient to discharge this Lease. In the event of a deposit pursuant to this Section (and provided that the Lessee has paid all Additional Payments due or accrued through the date of such deposit), all obligations of the Lessee under this Lease, and all security provided by this Lease for such obligations, shall cease and terminate, excepting only the obligation of the Lessee to make, or cause to be made, Lease Payments from the deposit made by the Lessee pursuant to this Section, and the entire interest of the Lessor in the Leased Property shall vest in the Lessee on the date of such deposit automatically and without further action by the Lessee or the Lessor (except as provided herein); provided, that vesting of title to the Leased Property in the Lessee shall be subject to the subsequent payment of Lease Payments made from such deposit in accordance with the provisions of this Lease. Such deposit shall be deemed to be and shall constitute a special fund for the payment of the Lease Payments in accordance with the provisions of this Lease. The Lessor shall execute and deliver such further instruments and take such further action as may reasonably be requested by the Lessee for carrying out the title transfer of the Leased Property.

SECTION 10.2 Mandatory Prepayment From Net Insurance and Condemnation Proceeds The Lessee shall be obligated to prepay the unpaid principal components of the Lease Payments in whole or in part in such order of prepayment as shall be selected by the Lessee on any date, together with any accrued and unpaid interest, and any other costs related to such prepayment, from and to the extent of any proceeds of insurance award or condemnation award with respect to the Leased Property to be used for such purpose hereunder. The Lessee and the Lessor hereby agree that such proceeds, to the extent remaining after payment of any delinquent Lease Payments, shall be credited towards the Lessee’s obligations under this Section 10.2.

ARTICLE XI

ADDITIONAL COVENANTS
SECTION 11.1 Compliance with and Enforcement of this Lease The Lessee covenants and agrees to perform all obligations and duties imposed upon the Lessee hereunder. The Lessor represents, covenants and agrees to perform all obligations and duties imposed upon the Lessor under this Lease.

The Lessee will not do or permit anything to be done, or omit or refrain from doing anything, in any case where any such act done or permitted to be done, or any such omission or refraining from action, would or might be a ground for cancellation or termination of this Lease by the Lessor hereunder. The Lessor and the Lessee, immediately upon receiving or giving any notice, communication or other document in any way relating to or affecting its estate in the Leased Property, which may or can in any manner affect such estate of the Lessee, will deliver the same, or a copy thereof, to the Assignee.

SECTION 11.2 Observance of Laws and Regulations The Lessee will well and truly keep, observe and perform all valid and lawful obligations or regulations now or hereafter imposed on it by contract, or prescribed by any law of the United States, or of the State or by any officer, board or commission having jurisdiction or control, as a condition of the continued enjoyment of any and every right, privilege or franchise now owned or hereafter acquired by it, including its right to exist and carry on business as a general law city, to the end that such rights, privileges and

NRF/105390540.5
29 franchises shall be maintained and preserved, and shall not become abandoned, forfeited or in any manner impaired.

SECTION 11.3 Prosecution and Defense of Suits The Lessee shall promptly, and also upon request of the Assignee (it having no obligation to make such request) from time to time take such action as may be necessary or proper to remedy or cure any defect in or cloud upon the title to the Leased Property, whether now existing or hereafter developing and shall prosecute all such suits, actions and other proceedings as may be appropriate for such purpose and shall indemnify and save the Assignee harmless from all loss, cost, damage and expense, including attorneys’ fees and expenses, which it may incur by reason of any such defect, cloud, suit, action or proceeding.

SECTION 11.4 Reporting to Assignee The Lessee shall no later than 270 days after the close of each Fiscal Year, submit to the Lessor (only upon the Lessor’s written request) and to the Assignee, audited financial statements with respect to the Lessee for such fiscal year. In addition, the Lessee shall submit its annual budget each year in a timely manner to the Assignee, but no later than 20 days following its adoption by the City Council of the City.

SECTION 11.5 Further Assurances The Lessor and the Lessee will make, execute and deliver any and all such further resolutions, instruments and assurances as reasonably necessary or proper to carry out the intention or to facilitate the performance of this Lease, and for the better assuring and confirming to the Assignee of the rights and benefits provided herein.

ARTICLE XII

MISCELLANEOUS
SECTION 12.1 Notices Notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed to have been received five Business Days after deposit in the United States first-class mail, postage prepaid, to the named party at the following addresses:

If to the Lessee: City of South El Monte
1415 Santa Anita Avenue
South El Monte, CA 91733
Attention: City Manager
If to the Lessor: South El Monte Financing Authority
1415 Santa Anita Avenue
South El Monte, CA 91733
Attention: [Chief Administrative Officer]
If to Assignee: First Foundation Public Finance
2233 Douglas Blvd #300
Roseville, CA 95661
Attention: Trevor Mael
SECTION 12.2 Binding Effect This Lease shall inure to the benefit of and shall be binding upon the Lessor and the Lessee and their respective successors and assigns.

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30 SECTION 12.3 Severability In the event any provision of this Lease shall be held invalid or unenforceable by a court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provisions hereof.

SECTION 12.4 Lessor Not Liable The Lessor and its directors, officers, agents and employees shall not be liable to the Lessee or to any other party whomsoever for any death, injury or damage that may result to any person or property by or from any cause whatsoever in, on or about the Leased Property or any Leased Property Component.

SECTION 12.5 Net-Net-Net Lease This Lease shall be deemed and construed to be a “net-net-net lease” and the Lessee hereby agrees that the Lease Payments shall be an absolute net return to the Lessor, free and clear of any expenses, charges or set-offs whatsoever, except as expressly provided herein.

SECTION 12.6 Further Assurances and Corrective Instruments The Lessor and the Lessee agree that they will, from time to time, execute, acknowledge and deliver or cause to be executed, acknowledged and delivered, such supplements hereto and such further instruments as may reasonably be required for correcting any inadequate or incorrect description of the Leased Property hereby leased or intended so to be or for carrying out the expressed intentions of this Lease.

SECTION 12.7 Execution in Counterparts This Lease may be executed in any number of counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

SECTION 12.8 Applicable Law This Lease shall be governed by and construed in accordance with the laws of the State, applicable to contracts made and performed in such State.

SECTION 12.9 Third-Party Beneficiaries The Assignee is expressly recognized as third-party beneficiaries under this Lease.

SECTION 12.10 No Merger of Estate This Lease shall not operate as a merger of the Lessee’s leasehold estate in the Leased Property and the Lessee’s fee estate in the Leased Property shall not cause the leasehold interest granted to the Lessor under the Site Lease to be extinguished.

SECTION 12.11 Assignee not Municipal Advisor Inasmuch as this Lease represents a negotiated transaction, each of the Lessor and the Lessee understands, and hereby confirms, that the Assignee is not acting as a fiduciary of the Lessor or the Lessee, but rather is acting solely in its capacity as purchaser of the Lease, for its own account. Each of Lessor and the Lessee acknowledges and agrees that: (i) the transaction that is contemplated herein is an arm’s length commercial transaction among the Lessor, the Lessee and the Assignee and its affiliates; (ii) in connection with such transaction, the Assignee and its affiliates are acting solely as principals and not as advisors including, without limitation, “Municipal Advisors” as such term is defined in Section 15B of the Securities and Exchange Act of 1934, as amended, and the related final rules (the “Municipal Advisor Rules”); (iii) the Assignee and its affiliates are relying on the bank exemption in the Municipal Advisor Rules; (iv) the Assignee and its affiliates have not provided any advice or assumed any advisory or fiduciary responsibility in favor of the Lessor or the Lessee with respect to the transaction contemplated hereby and the discussions, undertakings and

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31 procedures leading thereto (whether or not the Assignee, or any affiliate thereof, has provided other services or advised, or is currently providing other services or advising the Lessor or the Lessee on other matters); (v) the Assignee and its affiliates have financial and other interests that differ from those of the Lessor and the Lessee; and (vi) each of the Lessor and the Lessee has consulted with its own financial, legal, accounting, tax and other advisors, as applicable, to the extent that it deemed appropriate.

SECTION 12.12 Judicial Reference
(a) The Lessee hereby agrees as follows:
(1) each proceeding or hearing based upon or arising out of, directly or indirectly, this Lease or any document related thereto, any dealings of the Lessee related to the subject matter of this Lease or any related transactions (hereinafter, a “Claim”) shall be determined by a consensual general judicial reference (the “Reference”) pursuant to the provisions of section 638 et seq. of the California Code of Civil Procedure, as such statutes may be amended or modified from time to time;
(2) upon a written request, or upon an appropriate motion by the Lessee, any pending action relating to any Claim and every Claim shall be heard by a single Referee (as defined below) who shall then try all issues (including any and all questions of law and questions of fact relating thereto), and issue findings of fact and conclusions of law and report a statement of decision. The Referee’s statement of decision will constitute the conclusive determination of the Claim. The Lessee agrees that the Referee shall have the power to issue all legal and equitable relief appropriate under the circumstances before the Referee;
(3) the Lessee shall promptly and diligently cooperate with the Referee and shall perform such acts as may be necessary to obtain prompt and expeditious resolution of all Claims in accordance with the terms of this section; (4) the Lessee may file the Referee’s findings, conclusions and statement with the clerk or judge of any appropriate court, file a motion to confirm the Referee’s report and have judgment entered thereon. If the report is deemed incomplete by such court, the Referee may be required to complete the report and resubmit it; and (5) the Lessee will have such rights to assert such objections as are set forth in section 638 et seq. of the California Code of Civil Procedure. (b) The parties to the Reference proceeding shall select a single neutral referee (the “Referee”), who shall be a retired judge or justice of the courts of the State, or a federal court judge, in each case, with at least 10 years of judicial experience in civil matters. The Referee shall be appointed in accordance with section 638 of the California Code of Civil Procedure (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts). If within 10 days after the request or motion for the Reference, the parties to the Reference proceeding cannot agree upon a Referee, then any party to such proceeding may request or move that the Referee be appointed by the Presiding Judge of the Kings County Superior Court

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32 or the other similar federal court. The Referee shall determine all issues relating to the applicability, interpretation, legality and enforceability of this section. (c) No provision of this section shall limit the right of the Lessee to (i) exercise such self-help remedies as might otherwise be available under applicable law; or (ii) obtain or oppose provisional or ancillary remedies, including without limitation injunctive relief, writs of possession, the appointment of a receiver, and/or additional or supplementary remedies from a court of competent jurisdiction before, after, or during the pendency of any Reference. The exercise of, or opposition to, any such remedy does not waive the right of the Lessee to the Reference pursuant to this section.
(d) Promptly following the selection of the Referee, the parties to such Reference proceeding shall each advance equal portions of the estimated fees and costs of the Referee. In the statement of decision issued by the Referee, the Referee shall award costs, including reasonable attorneys’ fees, to the prevailing party, if any, and may order the Referee’s fees to be paid or shared by the parties to such Reference proceeding in such manner as the Referee deems just. [Remainder of page intentionally left blank.]

IN WITNESS WHEREOF, the Lessor and the Lessee have caused this Lease to be executed in their names by their duly Authorized Signatories, as of the date first above written.

SOUTH EL MONTE FINANCING AUTHORITY,
as Lessor
By:

President

CITY OF SOUTH EL MONTE,
as Lessee
By:

City Manager

105390540.5

A NOTARY PUBLIC OR OTHER OFFICER COMPLETING THIS CERTIFICATE

VERIFIES ONLY THE IDENTITY OF THE INDIVIDUAL WHO SIGNED THE

DOCUMENT TO WHICH THIS CERTIFICATE IS ATTACHED, AND NOT THE TRUTHFULNESS, ACCURACY, OR VALIDITY OF THAT DOCUMENT.

STATE OF CALIFORNIA )
) ss:

COUNTY OF LOS ANGELES )
On ______________________________ before me,__________________________(insert name of the officer), Notary Public, personally appeared _________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
_________________________________ [Seal]

105390540.5

A NOTARY PUBLIC OR OTHER OFFICER COMPLETING THIS CERTIFICATE

VERIFIES ONLY THE IDENTITY OF THE INDIVIDUAL WHO SIGNED THE

DOCUMENT TO WHICH THIS CERTIFICATE IS ATTACHED, AND NOT THE TRUTHFULNESS, ACCURACY, OR VALIDITY OF THAT DOCUMENT.

STATE OF CALIFORNIA )
) ss:

COUNTY OF LOS ANGELES )
On ______________________________ before me,__________________________(insert name of the officer), Notary Public, personally appeared _________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
_________________________________ [Seal]

105390540.5
A-1

EXHIBIT A

SCHEDULE OF LEASE PAYMENTS
Amounts shall be paid on each Lease Payment Date in advance of the respective Payment Dates on the following schedule.
1 Assumed no Event of Default.

Bond
Payment
Date Principal Interest1
Debt
Service
Annual
Debt Service

105390540.5
B-1

EXHIBIT B

LEGAL DESCRIPTION OF LEASED PROPERTY

ATTACHMENT D

Trevor Mael | SVP, Public Finance | Tel: 916.724.2423 | Email: [email protected] March 10, 2021
RE: City of South El Monte
2022Lease Financing
Based upon your request and preliminary review of the information provided to-date, First Foundation Public Finance (“FFPF”) wou ld like express its interest in u nderwriting and obtaining credit approval for the following Credit Facilit y to the City of South El Monte, CA (“Borrower”) based on the terms outlined below. This Letter is provided by First Foundation Public Finance for discussion purposes only. It is not intended to be binding, does not create any obligation on the part of First Foundation Public Finance to Sponsoror any third party, and is not a commitment to lend or agreementof any kind. No obligationwhatsoever on the part of First Foundation Public Finance shall arise until execution and deliveryof a formal commitment or loan documentation by a duly authorized officerof FirstFoundationPublic Finance, which obligation shallbe subject to allof the conditions contained therein.

Theproposedloan conditions are:

STRUCTURE: Term
PURPOSE: Prepay existing UAL obligation
MAX. LOAN AMT: $11,000,000
INTERESTRATE: Taxable: 3.30%
RATE LOCK: The Rate will locked until July 7, 2022. If the Credit Facility fails to close within this period, FFPF reserves the right to adjust the rate.

TERM: 20-years
REPAYMENT: Semi-annual interest, annual principal payments AVERAGE LIFE: 12.0-years
PRE-PAYMENT: Repayable on any payment date at 103% of par in years 1-2, decreasing to 102% in years 3-4, and 101% in years 5-

6. Redeemable at par beginning in year 7 and thereafter.

COLLATERAL: Lease payments to be paid by the Borrower from any legally available funds. The Credit Facility will be secured with a leasehold interest in an essential asset of the Borrower (with insured value to meet or exceed the Loan Amount).

ADDITIONAL TERMS:Documents to be prepared by the Borrower’s Bond Counsel for review by FFPF’s counsel Nixon Peabody, LLP.

Legal fees and expenses of Nixon Peabody, LLP should not exceed $12,500. All other filing fees and related fees shall be paid by the Borrowerin connection with the issuance (including applicable CDIAC fees).

Periodic financial and collateral reporting by the Borrower, as well as representations and warranties of the Borrower regarding its status and ability to repay, taxability gross-up and covenants and conditions that are appropriate for a Credit Facility of the scope and nature proposed above will be determined as part of FFPF’s underwriting and credit approval process.

PDF’s of all executed and other documents listed on the Closing Index shall be provided to FFPF no later than 24 hours before the time of the requested wire; provided, that if any documents can only be signed after receipt of the wire, those documents shall be provided immediately after receipt of the wire.

In an event of default, a default rate equal to the Interest Rate + 3.00% will be required.

Notice: The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant's income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The federal agency that administers compliance w ith this law concerning this creditor is the Federal Deposit Insurance Corporation, Consumer Response Center, 1100 Walnut Street, Box #11, Kansas City, MO 64106.

City Council Agenda Report
Agenda Item No. 9.f.

DATE: June 28, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Rachel Barbosa, City Manager
SUBMITTED BY: Christy Lopez, Attorney/Partner
SUBJECT: CONSIDERATION OF NON-RENEWAL OF CONTRACT

AGREEMENT AND GENERAL RELEASE AND WAIVER OF

CLAIMS - CITY MANAGER
SUMMARY: City Council consideration of two agreements with the City Manager - NonRenewal of Contract Agreement and General Release and Waiver of Claims.

RECOMMENDED ACTION: The City Attorney recommends that the City Council approve this agenda item and the subject agreements.

FISCAL IMPACT: The fiscal impact of the obligation owed on the balance of the employment contract is $100,721.99. Upon agreement of the General Release and Waiver of Claims, the City is obligated to pay $85,000. The total fiscal impact is the sum of both actions amounting to $185,721.99.

DISCUSSION: City Manager Rachel Barbosa and the City Attorney have discussed her separation from employment as South El Monte’s City Manager. Ms.

Barbosa’s separation would be effective as of June 29, 2022. Ms. Barbosa has served as the City Manager since January 2020. She previously had served as the Interim City Manager since May 14, 2019.

Ms. Barbosa’s employment contract provides for a three (3) year term of employment from January 2020. This agreement expires on January 13, 2023. The City and Ms. Barbosa have mutually decided not to extend the employment contract and that Ms. Barbosa will separate on amicable terms.

The attached Non-Renewal of Contract Agreement would provide Ms. Barbosa the salary the City is contractually obligated to pay her under the employment contract through the end of the term of the contract. This amount is $100,721.99. This amount is consistent with applicable law and is less than the separation payments allowed under State law, which are up to an 18 month severance where there is a longer contract term. (Government Code § 53260) Ms. Barbosa is also waiving any additional compensation

from the CJPIA which offers additional compensation to executives under certain circumstances.

Separate from the issue of Ms. Barbosa’s conclusion of her employment agreement, Ms.

Barbosa and the City wish to settle all claims Ms. Barbosa believes she has and that do not relate to her salary. These claims involve confidential medical and private matters and are therefore not specified in the agreement. The parties desire to settle these claims on amicable terms and without incurring additional legal fees in a dispute. Accordingly, the attached General Release and Waiver of Claims would pay Ms. Barbosa $85,000 in exchange for a release of all claims she would have the right to bring against the City for her injury claims.

ATTACHMENT(S):

A. City Manager Non-Renewal of Contract Agreement
B. City Manager General Release and Waiver of Claims

ATTACHMENT A

01257.0004/798004.1

NON-RENEWAL OF CONTRACT AGREEMENT

1. PARTIES
This Non-Renewal of Contract Agreement (hereinafter referred to as the “AGREEMENT”) is entered into by and between the City of South El Monte, a California general law city and municipal corporation (hereinafter referred to as “THE CITY”), and RACHEL BARBOSA, an individual (hereinafter referred to as “EMPLOYEE”).

2. RECITALS
(a) EMPLOYEE was hired by THE CITY as an at-will city manager effective on or about January 14, 2020, serving at the pleasure of the City Council of THE CITY pursuant to a written employment contract (“THE CONTRACT”). THE CONTRACT provides for a term of employment for three (3) years, with the term expiring on January 13, 2023. (b) THE CITY and EMPLOYEE have mutually decided not to renew or extend the Agreement, and will separate on amicable terms effective June 29, 2022 prior to the end of the term of THE CONTRACT. In order to effectuate a mutually agreeable conclusion to EMPLOYEE’s employment with THE CITY, the parties desire to enter into this AGREEMENT whereby EMPLOYEE receives her full compensation of salary as provided under THE CONTRACT to the conclusion of the term. Accordingly, the parties hereto intend by this AGREEMENT to mutually conclude any and all employment relationships between THE CITY and EMPLOYEE by means of EMPLOYEE’s separation, effective June 29, 2022. This AGREEMENT sets forth the full and complete terms and conditions concluding EMPLOYEE’s employment relationship with the CITY and any obligations related thereto, including any provided under THE CONTRACT, except that concurrently herewith the parties have entered into a separate agreement releasing certain claims (the “RELEASE”).
(c) In accordance with this AGREEMENT and with applicable state and federal laws, EMPLOYEE acknowledges that EMPLOYEE has been advised of EMPLOYEE’s postemployment rights, including but not limited to, EMPLOYEE’s rights under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Employee Retirement Income Security Act of 1974 (“ERISA”), and the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”).

3. CONSIDERATION

3.1 Payment in Accordance with Contract. EMPLOYEE shall receive payment to her at the time of her separation all earned salary, accrued fringe benefits as detailed in THE CONTRACT, and/or all other wage compensation/benefits owed to EMPLOYEE upon separation of employment, as required by state, federal or municipal law or THE CONTRACT or any other agreement with THE CITY.

3.2 Separation. EMPLOYEE agrees that her signature on this AGREEMENT shall be deemed a voluntary and irrevocable resignation of her employment effective at 12:01 a.m. on June 29, 2022.

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3.3 Payments. THE CITY shall cause to be paid to EMPLOYEE the payments of EMPLOYEE’s current salary, which remaining contractual amount is One Hundred Thousand Seven Hundred Twenty-One Dollars and 99 cents ($100,721.99), to be paid on or before July 1, 2022, as set forth in THE CONTRACT, which is the remaining salary due EMPLOYEE under THE CONTRACT from EMPLOYEE’s date of separation. These payments shall be subject to applicable state and federal withholdings as determined appropriate by THE CITY.

3.4 Contract Release. In exchange for the payment provided for herein, EMPLOYEE, and on behalf of EMPLOYEE’s spouse, heirs, representatives, successors, and assigns, hereby releases, acquits, and forever discharges THE CITY, and each of its predecessors, successors, assigns, officials, employees, representatives, agents, insurers, attorneys, and all persons and entities acting by, through, under, or in concert with any of them (“CITY PARTIES”), and each of them from any and all claims arising from the early termination of THE CONTRACT or any other agreement of employment, any demand for wages, overtime or benefits, any claims of violation of the provisions of ERISA, COBRA or HIPAA, or of any alleged breach of any express or implied contract for continued employment. In addition to the release of contract rights, the parties have entered into a separate agreement for the release of other non-contract related claims. EMPLOYEE further waives the right to the executive compensation program offered by CJPIA and to any additional compensation from the CJPIA.

4. REPRESENTATIONS AND WARRANTIES
Each of the parties to this AGREEMENT represents and warrants to, and agrees with, each other party as follows:

4.1 Advice of Counsel: The parties hereto have received independent legal advice from their respective attorneys concerning the advisability of entering into and executing this AGREEMENT or have been given the opportunity to obtain such advice. The parties acknowledge that they have been represented by counsel of their own choice in the negotiation of this AGREEMENT, or had such opportunity; that they have read this AGREEMENT; that they have had this AGREEMENT fully explained to them by such counsel, or have had such opportunity; and that they are fully aware of the contents of this AGREEMENT and of its legal effect.

4.2 No Fraud in Inducement: No party (nor any officer, agent, employee, representative, or attorney of or for any party) has made any statement or representation or failed to make any statement or representation to any other party regarding any fact relied upon in entering into this AGREEMENT, and neither party relies upon any statement, representation, omission or promise of any other party in executing this AGREEMENT, or in making the settlement provided for herein, except as expressly stated in this AGREEMENT.

4.3 Independent Investigation: Each party to this AGREEMENT has made such investigation of the facts pertaining to this settlement and this AGREEMENT and all the matters pertaining thereto, as it deems necessary.

4.4 Mistake Waived: In entering into this AGREEMENT, each party assumes the risk of any misrepresentation, concealment or mistake. If any party should subsequently discover that any fact relied upon by it in entering into this AGREEMENT was untrue, or that any fact was

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concealed from it, or that its understanding of the facts or of the law was incorrect, such party shall not be entitled to any relief in connection therewith, including without limitation on the generality of the foregoing any alleged right or claim to set aside or rescind this AGREEMENT. This AGREEMENT is intended to be, and is, final and binding between the parties, regardless of any claims of misrepresentation, promise made without the intent to perform, concealment of fact, mistake of fact or law, or any other circumstance whatsoever.

4.5 Later Discovery: The parties are aware that they may hereafter discover claims or facts in addition to or different from those they now know or believe to be true with respect to the matters related herein. Nevertheless, it is the intention of the parties that EMPLOYEE fully, finally and forever settle all claims relative to the early termination of THE CONTRACT, as set forth in Section 3.4, which do now exist or may exist against THE CITY or the CITY PARTIES. In furtherance of such intention, the releases given here shall be, and remain, in effect as full and complete releases of all such matters, notwithstanding the discovery or existence of any additional or different claims or facts relative thereto.

4.6 Indemnification: EMPLOYEE agrees to indemnify and hold harmless THE CITY or the CITY PARTIES from, and against, any and all claims, damages, or liabilities sustained by them as a direct result of the violation or breach of the covenants, warranties, and representations undertaken pursuant to the provisions of this AGREEMENT. EMPLOYEE understands and agrees that EMPLOYEE shall be exclusively liable for the payment of all taxes for which EMPLOYEE is responsible, if any, as a result of EMPLOYEE’s receipt of the consideration referred to in Section 3 of this AGREEMENT. In addition, EMPLOYEE agrees fully to indemnify and hold the CITY PARTIES harmless for payment of tax obligations as may be required by any federal, state or local taxing authority, at any time, as a result of the payment of the consideration set forth in Section 3 of this AGREEMENT.

4.7 Future Cooperation & Consultation fees: EMPLOYEE shall execute all such further and additional documents as shall be reasonable, convenient, necessary or desirable to carry out the provisions of this AGREEMENT. As part of her agreement for cooperation, EMPLOYEE voluntarily agrees not to disparage and make any reputation damaging statements about the City including its elected and appointed officials and employees. EMPLOYEE shall provide THE CITY with consultation services (including deposition or trial testimony) in any litigation or other matter at THE CITY’s discretion that involves THE CITY. Said services shall be provided as needed by THE CITY at a rate of $100.00 per hour.

4.8 Return of Confidential Information and Property: Prior to the separation date, EMPLOYEE shall submit a written inventory of, and return to the City Clerk, all City keys, equipment, computer identification cards or codes, and other equipment or materials or confidential documents provided to or obtained by EMPLOYEE during the course of EMPLOYEE’s employment with THE CITY.

4.9 Ownership of Claims: EMPLOYEE represents and warrants as a material term of this AGREEMENT that EMPLOYEE has not heretofore assigned, transferred, released or granted, or purported to assign, transfer, release or grant, any of the claims disposed of by this AGREEMENT. In executing this AGREEMENT, EMPLOYEE further warrants and represents that

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none of the claims released by EMPLOYEE thereunder will in the future be assigned, conveyed, or transferred in any fashion to any other person and/or entity.

4.10 Enforcement Fees and Costs: Should any legal action be required to enforce the terms of this AGREEMENT, the prevailing party shall be entitled to reasonable attorneys’ fees and costs in addition to any other relief to which that party may be entitled.

5. MISCELLANEOUS

5.1 Effective Date: This AGREEMENT shall be effective the first day on which all of the following have occurred: i) it has been executed by EMPLOYEE and THE CITY and attested to by the City Clerk; ii) it has been approved as to form; and iii) it has been approved by the City Council of THE CITY (the “EFFECTIVE DATE”).

5.2 Governing Law: This AGREEMENT has been executed and delivered within the State of California, and the rights and obligations of the parties shall be construed and enforced in accordance with, and governed by, the laws of the State of California.

5.3 Interpretation: Each party agrees that it has cooperated in the drafting and preparation of this AGREEMENT. Hence, in any construction to be made of this AGREEMENT, the parties agree that same shall not be construed against any party. This AGREEMENT and the RELEASE are the entire agreement between the parties with respect to the early termination of THE CONTRACT and supersedes all prior and contemporaneous oral and written agreements and discussions. This AGREEMENT may be amended only by a further agreement in writing, signed by the parties hereto.

5.4 Successors: This AGREEMENT is binding upon and shall inure to the benefit of the parties hereto, their respective agents, spouses, employees, representatives, officials, attorneys, assigns, heirs, and successors in interest.

5.5 Severability: In the event that any term, covenant, condition, provision or agreement contained in this AGREEMENT is held to be invalid or void by any court of competent jurisdiction, the invalidity of any such term, covenant, condition, provision or agreement shall in no way affect any other term, covenant, condition, provision or agreement and the remainder of this AGREEMENT shall still be in full force and effect.

5.6 Notice: Any and all notices given to any party under this AGREEMENT shall be given as provided in this paragraph. All notices given to either party shall be made by certified or registered United States mail, or personal delivery, at the noticing party’s discretion, and addressed to the parties as set forth below. Notices shall be deemed, for all purposes, to have been given and/or received on the date of personal service or three (3) consecutive calendar days following deposit of the same in the United States mail.

As to EMPLOYEE:

At EMPLOYEE’s home address on file with THE CITY.

As to THE CITY:

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01257.0004/798004.1
Mayor
City of South El Monte
1415 Santa Anita Avenue
South El Monte, CA 91733

5.7 Other Terms: CITY agrees to provide a letter of reference for EMPLOYEE that does not negatively reflect on the EMPLOYEE.

5.8 Authority: Each party represents to the other that it has the right to enter into this AGREEMENT, and that it is not violating the terms or conditions of any other agreement to which they are a party or by which they are bound by entering into this AGREEMENT. The parties represent that they will obtain all necessary approvals to execute this AGREEMENT. It is further represented and agreed that the individuals signing this AGREEMENT on behalf of the respective parties have actual authority to execute this AGREEMENT and, by doing so, bind the party on whose behalf this AGREEMENT has been signed.

SIGNATURES ON FOLLOWING PAGE

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IN WITNESS WHEREOF, THE CITY has caused this AGREEMENT to be signed and executed on its behalf by its Mayor and duly attested by its City Clerk, EMPLOYEE has signed and executed this AGREEMENT, and the attorneys for THE CITY and EMPLOYEE, if any, have approved as to form as of the dates written below.

DATED: _______________ EMPLOYEE
By: ________________________________
Rachel Barbosa

THE CITY
DATED: __________________ By: ________________________________ Gloria Olmos, Mayor
ATTEST:
__________________________
City Clerk
APPROVED AS TO FORM:

ALESHIRE & WYNDER, LLP
By: _______________________________
Anthony R. Taylor, City Attorney
6/23/22 Page 248 of 289

ATTACHMENT B

Employee Initials ___
01257.0004/798001.1

GENERAL RELEASE AND WAIVER OF CLAIMS
This General Release and Waiver of Claims (hereinafter referred to as the “RELEASE”) is entered into by and between the City of South El Monte, a California general law city and municipal corporation (hereinafter referred to as “THE CITY”), and RACHEL BARBOSA, an individual (hereinafter referred to as “EMPLOYEE”) for the following purposes and with reference to the following facts:

RECITALS
WHEREAS, EMPLOYEE was appointed as Deputy City Manager for the City on November 6, 2017.

WHEREAS, EMPLOYEE was appointed as the City’s Interim City Manager on May 14, 2019.

WHEREAS, on January 14, 2020, the City Council appointed EMPLOYEE as City Manager subject to a City Manager Employment Agreement that would be presented at a future council meeting.

WHEREAS, on March 24, 2020 EMPLOYEE and THE CITY entered into a written contract setting forth the terms and conditions of EMPLOYEE’s at-will employment as City Manager (the “CONTRACT”), which had a term expiring on January 13, 2023.

WHEREAS, EMPLOYEE is currently over the age of forty (40).

WHEREAS, CITY has chosen not to extend the CONTRACT and by that certain NonRenewal of Contract Agreement (the “AGREEMENT”) entered into concurrently herewith, EMPLOYEE and THE CITY agreed that EMPLOYEE will amicably separate from her employment with THE CITY effective June 29, 2022.

WHEREAS, independent from EMPLOYEE’s separation and early termination of EMPLOYEE’s employment agreement, EMPLOYEE believes she may have certain noncontractual employment-related personal injury claims against THE CITY but wishes not to pursue such claims under the terms of this RELEASE.

WHEREAS, although THE CITY disputes such claims, rather than contesting such personal injury claims through litigation, THE CITY now desires to settle such claims in order to avoid costly litigation. THE CITY and EMPLOYEE would have desired to settle such personal injury claims regardless of EMPLOYEE’s separation from the THE CITY.

WHEREAS, the parties now desire to settle any potential claims EMPLOYEE may have against THE CITY, whereby EMPLOYEE receives compensation in exchange for executing a general release and waiver of any and all claims that EMPLOYEE may have against THE CITY, including but not limited to its elected and non-elected officials, employees, attorneys, and agents.

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01257.0004/798001.1 Employee Initials ___

AGREEMENT

1. Recitals. All of the recitals listed above are material provisions of this RELEASE.

2. Releases. In exchange for the payment provided for herein, EMPLOYEE, and on behalf of EMPLOYEE’s spouse, heirs, representatives, successors, and assigns, hereby releases, acquits, and forever discharges THE CITY, and each of its predecessors, successors, assigns, officials, employees, representatives, agents, insurers, attorneys, and all persons and entities acting by, through, under, or in concert with any of them, and each of them (hereinafter referred to as “THE CITY PARTIES”), from any and all claims, charges, complaints, contracts, understandings, liabilities, obligations, promises, benefits, agreements, controversies, costs, losses, debts, expenses, damages, actions, causes of action, suits, rights, and demands of any nature whatsoever, known or unknown, suspected or unsuspected, which EMPLOYEE now has or may acquire in the future, or which EMPLOYEE ever had, relating to or arising out of any act, omission, occurrence, condition, event, transaction, or thing which was done, omitted to be done, occurred or was in effect at any time from the beginning of time up to and including the date of EMPLOYEE’s execution of this RELEASE and last day of employment (hereinafter referred to collectively as “CLAIMS”), without regard to whether such CLAIMS arise under the federal, state, or local constitutions, statutes, rules or regulations, or the common law. EMPLOYEE expressly acknowledges that the CLAIMS forever barred by this RELEASE specifically include, but are not limited to, any alleged breach of any duty arising out of tort, any alleged employment discrimination or unlawful discriminatory act, or any claim or cause of action including, but not limited to, any and all claims whether arising under any federal, state or local law prohibiting employment discrimination based upon age, race, color, sex, religion, handicap or disability, national origin or any other protected category or characteristic, and any and all rights or claims arising under the California Labor Code or Industrial Welfare Commission Wage Orders, the Federal Fair Labor Standards Act, the California Fair Employment and Housing Act, California Government Code §§12900 et seq., the Americans With Disabilities Act, Title VII of the Civil Rights Act of 1964, the Public Safety Officers Procedural Bill of Right Act, and any other federal, state, or local human rights, civil rights, or employment discrimination or employee rights statute, rule, or regulation.

Nothing herein shall be interpreted as a release or waiver of any workers’ compensation claims or in any way prohibit or prevent EMPLOYEE from participating in any claims or administrative action brought by a state or federal agency. Furthermore, nothing herein shall be interpreted as a release or waiver of THE CITY’s statutory obligations relative to providing defense and indemnification of public employees, if any, including but not limited to Government Code Sections 825-825.6 and Sections 995-996.6.

3. Consideration. In exchange for the waivers and releases set forth herein, THE CITY shall cause to be paid to EMPLOYEE a total payment of Eighty Five Thousand Dollars and zero cents ($85,000.00) for all of her personal injury claims, in the form of two checks made payable to EMPLOYEE to be mailed to EMPLOYEE at EMPLOYEE’s home address via certified mail return receipt requested and in two equal installments, the first installment being paid by February 1, 2023 and the second installment by July 15, 2023, and these installments will only be paid if the RELEASE is not revoked by EMPLOYEE under Section 4.

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01257.0004/798001.1 Employee Initials ___

4. Specific Acknowledgement of Waiver of Claims Under ADEA and OWBPA. The Age Discrimination in Employment Act of 1967 (hereinafter referred to as the “ADEA”) makes it illegal for an employer to discharge any individual or otherwise discriminate with respect to the nature and privileges of an individual’s employment on the basis that the individual is age forty (40) or older. The Older Workers Benefit Protection Act (hereinafter referred to as the “OWBPA,” 29 U.S.C. § 626, et. seq., Pub L 101-433, 104 Stat. 978 (1990)) further augments the ADEA and prohibits the waiver of any right or claim under the ADEA, unless the waiver is knowing and voluntary. By entering into this RELEASE, EMPLOYEE acknowledges that EMPLOYEE knowingly and voluntarily, for just compensation in addition to anything of value to which EMPLOYEE was already entitled, waives and releases any rights he may have under the ADEA and/or OWBPA. EMPLOYEE further acknowledges that EMPLOYEE has been advised and understands, pursuant to the provisions of the ADEA and OWBPA, that:
(a) This RELEASE incorporates all representations and warranties of the AGREEMENT and is written in a manner understood by EMPLOYEE; (b) EMPLOYEE is aware of, and/or has been advised of, EMPLOYEE’s rights under the ADEA and OWBPA, and of the legal significance of EMPLOYEE’s waiver of any possible claims EMPLOYEE currently may have under the ADEA, OWBPA and/or similar age discrimination laws;
(c) EMPLOYEE is entitled to a reasonable time of at least twenty-one (21) days within which to review and consider this RELEASE and the waiver and release of any rights EMPLOYEE may have under the ADEA, the OWBPA and similar age discrimination laws; but may, in the exercise of EMPLOYEE’s own discretion, sign or reject this RELEASE at any time before the expiration of the twenty-one (21) days; (d) The waivers and releases set forth in this RELEASE shall not apply to any rights or claims that may arise under the ADEA and/or OWBPA after the EFFECTIVE DATE of this RELEASE;
(e) EMPLOYEE has been advised by this writing that EMPLOYEE should consult with an attorney prior to executing this RELEASE; (f) EMPLOYEE has discussed this waiver and release with, and been advised with respect thereto by, EMPLOYEE’s counsel of choice or at least had the opportunity to do so, and EMPLOYEE represents by signing this RELEASE that EMPLOYEE does not need any additional time within which to review and consider this RELEASE; (g) EMPLOYEE has seven (7) days following EMPLOYEE’s execution of this RELEASE to revoke the RELEASE;
(h) Notice of revocation within the seven (7) day revocation period must be provided, in writing, to THE CITY pursuant to Paragraph 11 herein, and must state, “I hereby revoke my acceptance of our General Release and Waiver of Claims;” and

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(i) This RELEASE shall not be effective until all parties have signed the RELEASE and ten (10) days have passed since EMPLOYEE’s execution of same (“EFFECTIVE DATE”).

5. Unknown Claims. In relation to the release provisions of Paragraphs 2 and 4 above, EMPLOYEE understands that California Civil Code section 1542 reads as follows:
“General Release--Claims Extinguished”
“A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”
EMPLOYEE hereby waives the protection of California Civil Code section 1542.

6. Waiver of Additional Claims. EMPLOYEE hereby waives any provisions of state or federal law that might require a more detailed specification of the claims being released pursuant to the provisions of Paragraphs 2, 4, and 5 above. EMPLOYEE further waives the right to the executive compensation program offered by CJPIA and to any additional compensation from the CJPIA.

7. Representations and Warranties. This RELEASE incorporates all the representations and warranties of the AGREEMENT. Additionally, each of the parties to this RELEASE represents and warrants to, and agrees with, each other party as follows:
(a) Indemnification. EMPLOYEE agrees to indemnify and hold harmless THE CITY or THE CITY PARTIES from, and against, any and all claims, damages, or liabilities sustained by them as a direct result of the violation or breach of the covenants, warranties, and representations undertaken pursuant to the provisions of this RELEASE. EMPLOYEE understands and agrees that EMPLOYEE shall be exclusively liable for the payment of all taxes for which EMPLOYEE is responsible, if any, as a result of EMPLOYEE’s receipt of the consideration referred to in Paragraph 3 of this RELEASE. In addition, EMPLOYEE agrees fully to indemnify and hold the CITY PARTIES harmless for payment of tax obligations as may be required by any federal, state or local taxing authority, at any time, as a result of the payment of the consideration set forth in Paragraph 3 of this RELEASE. (b) No Pending Claims and/or Actions. EMPLOYEE represents that EMPLOYEE has not filed any complaints or charges against THE CITY or THE CITY PARTIES with any local, state or federal agency or court; that EMPLOYEE will not do so at any time hereafter for any claim arising up to and including the EFFECTIVE DATE of this RELEASE; and that if any such agency or court assumes jurisdiction of any such complaint or charge against THE CITY or THE CITY PARTIES on behalf of EMPLOYEE, whenever or where ever filed, EMPLOYEE will request such agency or court to withdraw from the matter forthwith. Nothing herein shall be interpreted as a release or waiver of any workers’ compensation claims or in any way prohibit or prevent EMPLOYEE from participating in any claims or administrative action brought by a state or federal agency.

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(c) Ownership of Claims. EMPLOYEE represents and warrants as a material term of this RELEASE that EMPLOYEE has not heretofore assigned, transferred, released or granted, or purported to assign, transfer, release or grant, any of the CLAIMS disposed of by this RELEASE. In executing this RELEASE, EMPLOYEE further warrants and represents that none of the CLAIMS released by EMPLOYEE thereunder will in the future be assigned, conveyed, or transferred in any fashion to any other person and/or entity. (d) Enforcement Fees and Costs. Should any legal action be required to enforce the terms of this RELEASE, the prevailing party shall be entitled to reasonable attorneys’ fees and costs in addition to any other relief to which that party may be entitled.

8. No Admission. Nothing contained herein shall be construed as an admission by THE CITY of any liability of any kind. THE CITY denies any liability in connection with any claim and intends hereby solely to avoid potential claims and/or litigation and buy its peace.

9. Governing Law. This RELEASE has been executed and delivered within the State of California, and the rights and obligations of the parties shall be construed and enforced in accordance with, and governed by, the laws of the State of California.

10. Severability. In the event that any term, covenant, condition, provision or agreement contained in this RELEASE is held to be invalid or void by any court of competent jurisdiction, the invalidity of any such term, covenant, condition, provision or agreement shall in no way affect any other term, covenant, condition, provision or agreement and the remainder of this RELEASE shall still be in force and effect.

11. Notice. Any and all notices given to any party under this RELEASE shall be given as provided in this paragraph. All notices given to either party shall be made by certified or registered United States mail, or personal delivery, at the noticing party’s discretion, and addressed to the parties as set forth below. Notices shall be deemed, for all purposes, to have been given and/or received on the date of personal service or three (3) consecutive calendar days following deposit of the same in the United States mail.

As to EMPLOYEE:

At EMPLOYEE’s home address on file with THE CITY.

As to THE CITY:

Mayor
City of South El Monte
1415 Santa Anita Ave.

South El Monte, California 91733

12. Authority. Each party represents to the other that it has the right to enter into this RELEASE, and that it is not violating the terms or conditions of any other agreement to which they are a party or by which they are bound by entering into this RELEASE. The parties represent that they will obtain all necessary approvals to execute this RELEASE. It

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01257.0004/798001.1 Employee Initials ___
is further represented and agreed that the individuals signing this RELEASE on behalf of the respective parties have actual authority to execute this AGREEMENT and, by doing so, bind the party on whose behalf this RELEASE has been signed.

PLEASE READ CAREFULLY. THIS GENERAL RELEASE AND WAIVER OF CLAIMS INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

IN WITNESS WHEREOF, THE CITY has caused this RELEASE to be signed and executed on its behalf by its Mayor and duly attested by its City Clerk, EMPLOYEE has signed and executed this RELEASE, and the attorneys for THE CITY and EMPLOYEE, if any, have approved as to form as of the dates written below.

DATED: _______________ EMPLOYEE
By: ________________________________
Rachel Barbosa

THE CITY
DATED: __________________ By: ________________________________ Gloria Olmos, Mayor
ATTEST:
__________________________
City Clerk
APPROVED AS TO FORM:

ALESHIRE & WYNDER, LLP
By: _______________________________
Anthony R. Taylor, City Attorney