HomeMy WebLinkAbout1999-10-05; City Council; 15430; Agreement For Pine School Site. . p
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CITY OF CARLSBAD --AGENDA BILL a 45 I c.J 13
AB# /f;; 43 0 : TITLE AGREEMENT FOR SALE OF REAL DEPT.HD.
MTG. (Q-S, 99 PROPERTY AND GROUND LEASE AGREEMENT CITY AT
DEPT.RECREATION FOR THE PINE SCHOOL SITE CITY MGRU h
RECOMMENDED ACTION : ?’
If Council concurs, adopt Resolution No. 74 c q$s approving the Agreement for Sale of Real
Property and Ground Lease Agreement for the Pine School site, ratifying the Mayor’s signature as the
City’s authorized representative on all documents related to this sale, accepting the Planning
Commission’s finding of General Plan consistency, authorization of a loan, appropriation of funds, and
directing staff to take all necessary steps to conclude the acquisition process.
ITEM EXPLANATION :
In February of this year, Council authorized a Memorandum of Understanding (MOU) between the
City of Carlsbad and the Carlsbad Unified School District (CUSD) outlining an acquisition strategy for
the Pine School property and directed staff to initiate the acquisition process.
Staff retained the services of the TAGG Company to perform an appraisal of the subject 7.2 acre
parcel of property located west of Harding Street and south of Pine Avenue. As previously discussed
with Council during closed session, the fair market value of the property was determined to be
$3,660,000. That established value is mutually acceptable to the City and CUSD. Furthermore, the
price assumes all permanent and some relocatable structures remain on site. All relocatable
structures presently leased by CUSD as classrooms shall be removed by the District as part of the
acquisition and lease back strategy.
In an effort to conclude the acquisition process, staff has developed an Agreement for Sale of Real
Property (Exhibit 2) and a Ground Lease Agreement (Exhibit 3) between the City and CUSD. The
provisions of both agreements are in accordance with previous Council directives. Staff from both
agencies, including legal counsel are in accord with the content of each Agreement and are
recommending approval by City Council.
In essence, the Agreement For Sale of Real Property includes conditions of sale, purchase price and
title, warranties and representations, escrow instructions and miscellaneous provisions. In addition to
fundamental information, the Ground Lease Agreement includes lease terms and other stipulations
which allow a lease back of the property to CUSD for a nominal amount if the property is vacated by
specific dates. Summarily, the District will lease the property for $1 per year if the elementary
education component on site is vacated no later than June 30, 2000 and the Carlsbad Village
Academy and maintenance component occupying the site is vacated no later than June 30, 2001. If
the site is not vacated by those dates, retroactive lease payments may total in excess of $100,000.
With respect to future development of the Pine School property for use as a recreational facility,
the current Capital Improvement Program (CIP) Budget outlines funding for master planning the
parksite in FY 2002-04 and development in subsequent years. As part of the park master
planning process, an extensive community outreach program will be promoted and implemented
to insure the park’s development incorporates the wants and needs of the community to the
greatest extent possible.
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AB# 5430
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In the interim and in anticipation of the School District vacating the Pine Elementary School
buildings by June 30,2000, City staff is performing a needs assessment of city programs which
might occupy the facility on a temporary basis. As a part of that needs assessment, staff is also
evaluating the condition of the facility in terms of rehabilitation costs and ongoing maintenance
and operation expense. These factors will be critical in establishing a recommendation to City
Council for an interim use strategy prior to the time when the site will ultimately be developed as
a premier community parksite for the Northwest Quadrant. Staff anticipates returning to Council
with a report and recommendation prior to April 2000.
ENVIRONMENTAL REVIEW
On May 19, 1999, staff requested and received approval of a Planning Commission determination of
General Plan consistency for the acquisition of Pine School for future park and recreation purposes.
Approval of the consistency finding was determined because no construction of facilities is being
proposed at this time, the current project is for property acquisition only and until such time as a
permanent park facility is proposed, the sites existing recreation facilities may be used. When a
design is developed, that project will again be reviewed under all applicable regulations including
Title 19 of the Municipal Code, CEQA (Environmental Regulations) and Title 21 (Conditional Use
Permit Regulations) if required.
FISCAL IMPACT:
The total estimated cost for the purchase of the Pine School property is $3,700,000:
$3,660,000 for the property, and $40,000 in miscellaneous closing costs, legal documents, and
environmental studies. Funding for the acquisition is from Park-in-Lieu fees collected within the
NW Quadrant. The PIL NW Fund currently has a balance of $3,440,000, which includes an
existing loan from the GCC Fund for $600,000 previously authorized for this project. Therefore,
an additional $260,000 will be needed to bring the total cash available up to $3,700,000.
Council authorized an appropriation of $3,500,000 for the project with adoption of the 1999-
2000 CIP, so an additional appropriation of $200,000 is needed for a total of $3,700,000.
Cash Balance
PIL Fund
CIP Project Appropriation 1
Revised Project Cost $3,700,000 $3,700,000
Current Balance $3,440,000 $3,500,000
Additional Amount Needed $260,000 $200,000
Staff is therefore requesting that Council authorize a loan of $260,000 from the GCC fund to the
PIL NW Fund so that sufficient cash will be available to cover the total cost of the property
purchase. In addition, staff is requesting that Council authorize an additional appropriation in
the amount of $200,000, thereby increasing the authorized budget to $3,700,000.
EXHIBITS:
1. Resolution No. 99*455
2. Agreement for Sale of Real Property
3. Ground Lease Agreement
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RESOLUTION NO. 99-455
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, APPROVING AN AGREEMENT FOR SALE
OF REAL PROPERTY (APN 204-100-05) AND GROUND LEASE
AGREEMENT FOR THE PINE SCHOOL SITE, RATIFYING THE
MAYOR’S SIGNATURE AS THE CITY’S AUTHORIZED
REPRESENTATIVE ON ALL DOCUMENTS RELATED TO THIS SALE,
ACCEPTING THE PLANNING COMMISSION FINDING OF GENERAL
PLAN CONSISTENCY FOR THE PURCHASE OF THE SUBJECT
PROPERTY, AUTHORIZATION OF A LOAN, APPROPRIATION OF
FUNDS, AND DIRECTING STAFF TO TAKE ALL NECESSARY STEPS
TO CONCLUDE THE ACQUISITION PROCESS.
I WHEREAS, the Parks and Recreation Element of the Carlsbad General Plan
~ has for many years identified the acquisition of the Pine School property as a goal for
future park development; and
WHEREAS, the Carlsbad Unified School District (CUSD) considers the sale of
the Pine School property to be in the best interest of the district as a means by which to
more effectively address the facility needs of the students within the district; and
WHEREAS, The City and CUSD have previously entered into a Memorandum of
IL6 Understanding outlining an acquisition strategy for the Pine school site; and
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WHEREAS, the Planning Commission has made a determination of General
Plan consistency for the acquisition of the Pine School property for future park and
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21 WHEREAS, a property appraisal has established the value of the 7.2 acre Pine
22 School property to be three million six hundred sixty thousand dollars ($3,660,000), the
23 value of which , both agencies are in agreement with; and
24 WHEREAS, an Agreement for Sale of Real Property and Ground Lease
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Agreement for the Pine School site has been negotiated, prepared, reviewed and
approved by the staff and legal counsel representing both agencies, a copy of which is
attached hereto and made a part hereof; and
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1 WHEREAS, CUSD Board of Directors has approved the terms of both the Sale
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and Lease Agreement; and
WHEREAS, the Carlsbad City Council desires to purchase the Pine School site
for use as a future community parksite and lease the property back to CUSD on an
interim basis according to the terms and conditions as outlined in both agreements.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Carlsbad, California, the following:
1. That the above recitations are true and correct.
2. The Agreement for Sale of Real Property, attached hereto and made a part
hereof is hereby approved.
3. The Ground Lease Agreement, attached hereto and made a part hereof is
hereby approved.
4. The City Council hereby ratifies the Mayor’s signature as the authorized
representative on all documents related to the sale of the subject property.
5. The Planning Commissions finding of General Plan consistency for the
acquisition of the Pine School site for future park and recreation purpose is
hereby accepted and adopted by the Council as its own.
6. Authorization of a loan of $260,000 from the General Capital Construction
(GCC) Fund to the Northwest Quadrant Park-in-Lieu Fund is hereby
approved.
7. Authorization to appropriate an additional $200,000, thereby increasing the
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II required budget to $3,700,000 is hereby approved.
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8. Staff is hereby directed to take all steps necessary to conclude the acquisition
process.
PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council
of the City of Carlsbad, California, held on the 5th day of October , 1999, by the
* following vote to wit:
AYES: Council Members Lewis, Nygaard & Finnila
NOES: None
ABSENT: None
ABSTAIN: Council Member Hall
ATTEST:
<
MTHAGALI&N@NZ, City Clerk
KAREN R. KUNDTZ, Assistant City Clerk
AGREEMENT FOR SALE OF REAL PROPERTY
From the
CARLSBAD UNIFIED SCHOOL DISTRICT
To the
CITY OF CARLSBAD
Table of Contents
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..l
ARTICLE I SALE, PURCHASE PRICE, AND TITLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.1
1.2
1.3
1.4.1
1.4.2
1.4.3
1.5
1.5.1
1.6
1.7
SaleandLease-Back ............................................... .
PurchasePrice .................................................... .
Deposit of Purchase Price into Escrow ................................ .3
Preliminary and Supplemental Title Reports ............................ .3
Review of Title Documents ......................................... .3
Condition of Title ................................................. .4
Feasibility, Due Diligence, and Inspections ............................ .4
(a) General Inspections ......................................... .4
09 Environmental Inspections .................................... .4
Consequences of Feasibility and Due Diligence Inspections ............... .5
Notice of Eminent Domain Proceedings ............................... .5
DarnagetoProperty ................................................ .
ARTICLE II DISTRICT’S WARRANT IES AND REPRESENTATIONS . . . . . . . . . . . . . . . .6
2.1 Warranties and Representations ...................................... .6
(a) Legal Proceedings .......................................... .6
04 Liens and Encumbrances ..................................... .6
(c) Agreements ................................................ .
(4 Defaults ................................................... .
09 Authority ................................................. .7
(0 Documents ................................................. .
ARTICLE III CITY’S WARRANT IES AND REPRESENTATIONS . . . . . . . . . . . . . . . . . . . .7
3.1 Warranties and Representations ...................................... .7
(a) Agreements ................................................ .
(h) Authority ................................................. .7
ARTICLEIV ESCROW........................................................8
4.1
t.i
4:4
4.5
4.6
The Escrow and Escrow Holder ...................................... .8
Opening of Escrow and Recordation of Agreement ...................... .8
Acceptance by Escrow Holder ........................................ .8
CloseofEscrow .................................................... .
Sale Agreement to Constitute Escrow Instructions ....................... .9
Supplemental Escrow Instructions .................................... .9
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Table of Contents (cont’d)
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
City Deposit to Escrow ............................................ .9
District Deposit to Escrow ........................................... .9
Conditions Precedent to Close of Escrow .............................. .9
(4 Escrow and Agreement Not Terminated ......................... 10
O-9 Deposit of Funds ........................................... 10
w NoDefault .............................................. ..10
(4 TruthofWarranties ....................................... ..10
@I Title Insurance .............................................. 10
(0 GroundLease..............................................lO
TitlePolicy......................................................l 0
Recordation of Deed and Delivery of Funds ............................ 10 ’
Taxes ........................................................ ..ll
PaymentofCosts ............................................... ..ll
(4 TitleInsurance ........................................... ..ll
@I Escrow Costs .............................................. 11
(cl TransferTax...............................................ll
w Recording.................................................ll
Timeis ofthe Essence .............................................. 11
Escrow Cancellation Charges ....................................... 12
ARTICLE V MISCELLANEOUS PROVISIONS . . . :. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.1 Entire Agreement ................................................. 12
5.2 Incorporation of Recitals and Exhibits ................................ 12
5.3 Execution of Other Documents; Compliance with Regulations ............. 12
5.4 Affidavit of Non-Foreign Status ..................................... 12
5.5 Attomeys’Fees ................................................ ..13
5.6 Representation by Independent Counsel .............................. .13
5.7 Notices.. ..................................................... ..13
5.8 BrokerageFees...................................................l 4
5.9 Assignment ................................................... ..14
5.10 Waiver ....................................................... ..14
5.11 NotforBenefitofThirdParties.. ................................... .15
5.12 GovemingLawandVenue ....................................... ..15
5.13 SectionHeadings.. ............................................. ..15
5.14 Severability ................................................... ..15
5.15 Interpretation Guides .............................................. 15
5.16 Counterparts.....................................................l 6
5.17 Date of Sale Agreement ........................................... .16
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Table of Contents (cont’d)
EXHIBIT “A” LEGAL DESCRIPTION OF THE PROPERTY
EXHIBIT “B” MAP OF PROPERTY
EXHIBIT “C” LIST OF ALL PERMANENT AND RELOCATABLE
BUILDINGS AND OTHER AFFIXED IMPROVEMENT ON
THE PROPERTY, EXCLUDE ANY LEASE RELOCATABLE
STRUCTURES
EXHIBIT “D” ACKNOWLEDGMENT OF ESCROW OFFICER
EXHIBIT “E” GRANT DEED
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Recording requested by, and
when recorded deliver to:
Carlsbad Unified School District
Attention: Superintendent
801 Pine Avenue
Carlsbad, CA 92008-2439
Exempt from recording fee pursuant to Government Code $6103.
AGREEMENT FOR SALE OF REAL PROPERTY
FROM THE
CARLSBAD UNIFIED SCHOOL DISTNCT
TO THE
CITY OF CARLSBAD
This Agreement for the Sale of Real Property (“Sale Agreement”) is made in Carlsbad,
California, by and between the CARLSBAD UNIFIED SCHOOL DISTRICT (“District”), a
school district organized and existing under the laws of the State of California, and the CITY OF
CARLSBAD (“City”), a general law city located in the County of San Diego (“County”), State of
California (“State”) and is effective upon the mutual execution of the parties. District and City
may hereinafter be referred to individually as “Party” and collectively as “Parties.”
RECITALS
A. The District is the fee simple owner of certain real property totaling approximately
seven and two-tenths (7.2) acres located within the City at 3333 Harding Street, at the southwest
comer of Harding Street and Pine Avenue (“Property”), which currently serves as the site of the
District’s Pine Elementary School (“Pine School”). The Property is more fully described and
depicted in Exhibits “A” and “B” attached hereto. In addition to the Pine School, the Property
serves as the site for the District’s Carlsbad Village Academy (“CVA”), a continuation/
alternative education facility for high-school-aged students, and the District’s maintenance and
operations facilities (“M&O Facilities”).
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3042.56 9-l 5-99 Final
B. The District is in the process of constructing a new elementary school, the
Jefferson Elementary School (“Jefferson School”), within the attendance area containing the Pine
School. The District anticipates that, after completion of the Jefferson School and transfer of the
Pine School students to the Jefferson School, it will no longer need the Pine School facilities in
order to provide adequate school facilities for students in the area. The District desires to sell the
Property so that the District may utilize the sale proceeds for payment of the cost of acquisition
and construction of other school facilities for the District. In order to accomplish this sale and
use of sale proceeds, the District intends to relocate the CVA and its M&O Facilities.
C. City desires to purchase the Property from the District and to lease the Property to
the District until such time as the District has transferred the Pine School students to the
Jefferson School, relocated the CVA, and relocated the M&O Facilities, not to exceed the
respective maximum term of the lease, as it pertains to each component.
In consideration of the foregoing, the Parties agree as foilows:
ARTICLE I
SALE, PURCHASE PRICE, AND TITZE
Section 1.1 Sale and Lease-Back. Subject to all of the terms, covenants and
conditions contained herein, the District agrees to sell the Property to the City, and the City
agrees to buy the Property from the District. In consideration for entering into this Sale
Agreement, the City and the District hereby agree to execute an additional agreement providing
for the lease of the Property to the District on the terms and conditions heretofore negotiated, or
as hereafter mutually agreed, by the City and District (“Lease”).
Section 1.2 Purchase Price The purchase price for the Property (“Purchase Price”)
shall be three million, six hundred and sixty thousand dollars ($3,660,000) as established by the
appraisal prepared by the Tagg Company dated April 30,1999. The Purchase Price shall include
all permanent and relocatable buildings and other affixed improvements on the Property; but
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excludes all of the relocatable or portable structures, storage structures and other improvements
which are identified in the photo of the Property attached to this Agreement as Exhibit “C”.
Section 1.3 Deposit of Purchase Price into Escrow. City shall, within the time period
provided in this Sale Agreement, deposit funds equal to the Purchase Price into the escrow
opened to facilitate the sale of the Property pursuant to Section 4.1 (“Escrow”). Nothing in this
Sale Agreement shall be construed to relieve District or City of any obligation to deposit funds
into Escrow for any other purpose contemplated by this Sale Agreement, including payment of
Escrow costs.
Section 1.4.1 Preliminary and Supplemental Title Reports. Escrow Holder (defined in
Section 4.1) shall deliver to the City, within twenty (20) calendar days after the date of this Sale
Agreement, copies of a preliminary title report (“PTR”) covering the Property issued by Escrow
Holder in its capacity as title insurer (“Title Insurer”), together with complete and legible copies
of all underlying documents referred to in the PTR that evidence exceptions to title (“Underlying
Documents”), and a complete plotting report of all easements disclosed in the PTR (“Plotting
Report”). If subsequently required, no later than thirty-five (35) days after the date of this Sale
Agreement, Title Insurer shall deliver to the City any supplemental title report (“STR”) and any
Underlying Documents referenced therein. Title Insurer shall provide to the District copies of
the PTR, the STR, if any, and all Underlying Documents (collectively, “Title Documents”)
provided to the City.
Section 1.4.2 Review of Title Documents. The City shall have thirty (30) days from the
date it finally receives complete copies of the Title Documents to notify the Escrow Holder and
the District of any objections to title. The District shall have twenty (20) days in which to
respond to any objections to title and/or the approval of the Title Documents by the City. In the
event the City disapproves a matter disclosed in the Title Documents that the District declines to
cure, within twenty (20) days, and that the City declines to waive, within twenty (20) days, this
Sale Agreement shall terminate without further act of the City or the District, and either Party
may cancel the Escrow by delivering written notice to the Escrow Holder and the other Party.
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Upon any such cancellation of Escrow, each Party shall pay one-half of the Escrow cancellation
charges.
Section 1.4.3 Condition of Tifle. All matters contained in the Title Documents that are
approved by the City prior to Close of Escrow shall be deemed “Permitted Exceptions.” The
District shall convey to the City the fee simple title to the Property, which shall be, except for the
Permitted Exceptions, free and clear of all mortgages, liens, charges, encumbrances,
encroachments, easements, conditions, exceptions, assessments, taxes, or other defects of record
in the title. After Close of Escrow, the City shall hold fee simple title to the Property.
Section 1.5 Feasibility, Due Diligence, and Inspections. The City shall have sixty
(60) days from the date of this Sale Agreement to complete its due diligence inspection(s) (“Due
Diligence Period”). During the Due Diligence Period, upon reasonable notice to the District, the
District shall permit the City and its consultants, agents, contractors, and employees to enter upon
the Property during regular business hours or at other times as reasonably necessary to make
inspections of the Property. The City may conduct any such tests or inspections as the City may
elect or deem necessary including, but not limited to, the following:
(a) General Inspections. The City may review the feasibility of using the
Property and all factors relevant thereto, and may conduct any and all inspections, reviews,
examinations, and tests of the Property as may be relevant to such use of the Property. Any such
inspections, reviews, examinations or tests shall not unreasonably interfere with the District’s
continued use of the Property for the Pine School, the CVA, and the M&O Facilities.
0 Environmental Inspections. During the Due Diligence Period, the City
may conduct whatever environmental tests on the Property City deems necessary. Should the
City learn or be advised of a serious or substantial adverse condition existing on the Property, the
City shall promptly notify the District of that condition. In the event the City’s investigation(s)
reveal the presence of hazardous materials on the Property that would unreasonably and
substantially interfere with City’s intended use of the Property or violate any environmental law
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or are remediated or removed (with the exception of the presence of asbestos in any building or
structure on the Property), the City shall advise District if it intends to complete the purchase of
the Property. If the City does not desire to complete the purchase of the Property, the City may
terminate this Sale Agreement and cancel the Escrow, and City shall pay all Escrow cancellation
costs.
Section 1.5.1 Consequences of Feasibility and Due Diligence Inspections. If the City
does not approve, in writing, the physical or environmental condition of the Property prior to the
end of the Due Diligence Period, the City shall be deemed to have disapproved the physical and
environmental condition of the Property. The City shall notify the District in writing if, pursuant
to Section 1.5, the City disapproves the physical or environmental condition of the Property
during the Due Diligence Period and the basis for such disapproval. In such event, District may
either: (i) terminate this Sale Agreement by delivering written notice to the City within fifteen
(15) calendar days after receipt of notice of disapproval; or (ii) give written notice to the City
within fifteen (15) calendar days that the District intends to remove or abate the condition
(“Abatement Option”). If the District elects to exercise its Abatement Option under this Sale
Agreement, the District shall do so at its own cost and expense prior to transfer of possession of
the Property to City, which shall occur at the expiration or termination of the Lease referenced in
Section 1.1.
Section 1.6 Notice of Eminent Domain Proceedings. The City and the District shall
notify the other, in writing, if at any time before Close of Escrow: (i) any public agency threatens
to condemn all or any portion of the Property or any interest therein; (ii) any public agency
commences legal proceedings under the power of eminent domain to condemn all or a portion of
the Property or any interest therein; or (iii) any public agency files any notice of intended
condemnation or proceedings in the nature of eminent domain to acquire all or a portion of the
Property or any interest therein. In the event of such notice of possible condemnation, City may
elect to terminate this Sale Agreement and cancel the Escrow.
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Section 1.7 Damage to Propee. In the event the Property is materially damaged or
destroyed prior to the Close of Escrow, City may elect to terminate the Sale Agreement and
cancel the Escrow.
ARTICLE I.
DISTRICT’S WARRANTIES AND REPRESENTATIONS
Section 2.1 Warranties and Representations. In addition to any other warranties and
representations made by the District pursuant to this Sale Agreement, the District warrants and
represents that the following facts are true and correct as of the date the District executes this
Sale Agreement, and the truth and accuracy of such warranties and representations shall
constitute a condition to Close of Escrow.
(4 Legal Proceedings. To the best of District’s knowledge, the District is
not a party to or in any actions, suits, material claims, legal proceedings, or any other proceedings
pending or threatened before any court or governmental agency that could have a material,
adverse effect on City’s purchase, ownership, or intended use of the Property.
0 Liens and Encumbrances. To the best of District’s knowledge, there are
no liens or encumbrances on, or claims to, or covenants, conditions and restrictions, leases,
easements, or rights-of-way affecting, the Property, except as indicated in the Title Documents or
disclosed in writing to the City and approved by the City.
(4 Agreements. Neither this Sale Agreement, nor any action required
hereunder, violates or shall violate any contract, agreement, or instrument to which the District is
a party or that affects the Property or any portion thereof.
(4 Defaults. Neither the District, nor, to the best of District’s knowledge,
any other party, is in default with respect to any obligations or liabilities pertaining to the
Property, nor is there any existing state of facts or circumstances, or any condition or event, that
would constitute or result in any such default upon the giving of notice or the passage of time or
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both. The District has not received written notice or in any other manner learned of any default
or impending default by the District or any other party of any obligations or agreements that
could have a material and adverse effect upon the City’s ownership or use of the Property.
(4 Authority. The District has the full right and authority to enter into this
Sale Agreement and consummate the transactions contemplated herein, and each person signing
this Sale Agreement on behalf of the District is authorized to do so. No other person or entity is
required to consent to, acknowledge, or execute this Sale Agreement in order to validate its
execution by the District or to permit the consummation of the transactions contemplated herein.
u3 Documents. The District shall provide City with any reports related to the
condition of the Property in District’s possession prior to Close of Escrow.
ARTICLE III
CITY’S WARRANTIES AND REPRESENTATIONS
Section 3.1 Warranties and Representations. In addition to any other warranties and
representations made by the City pursuant to this Sale Agreement, the City warrants and
represents that the following facts are true and correct as of the date the City executes this Sale
Agreement, and the truth and accuracy of such warranties and representations shall constitute a
condition to Close of Escrow.
(a) Agreements. Neither this Sale Agreement, nor any action required
hereunder, violates or shall violate any contract, agreement or instrument to which the City is a
Party.
m Authority. The City has the full right and authority to enter into this Sale
Agreement and consummate the transactions contemplated herein, and each person signing this
Sale Agreement on behalf of the City is authorized to do so. No other person or entity is required
to consent to, acknowledge, or execute this Sale Agreement in order to validate its execution by
the City or to permit the consummation of the transactions contemplated herein.
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ARTICLE IV
ESCROW
Section 4.I The Escrow and Escrow Holder. The District shall open an escrow to
facilitate the transactions contemplated by this Sale Agreement (“Escrow”) with First American
Title Insurance Company (“Escrow Holder”), at the address specified in Section 5.7.
Section 4.2 Opening of Escrow and Recordation of Agreement. Within five (5)
business days after execution of three (3) fully executed originals or counterpart originals of this
Sale Agreement by the District and the City, the District shall deposit one executed copy of the
Sale Agreement into Escrow and forward one executed copy of the Sale Agreement to the City.
Escrow shall be deemed to be open as of the date the Escrow Holder receives the Escrow copy of
this Sale Agreement (“Opening of Escrow”). The Escrow shall be administered under the escrow
number assigned by the Escrow Holder for such purpose. The Escrow Holder shall notify the
Parties and their respective legal counsel of the date for Opening of Escrow. The Escrow Holder
shall, as soon thereafter as practical, cause the Escrow copy of the Sale Agreement to be recorded
and conformed copies thereof to be delivered to District and City.
Section 4.3 Acceptance by Escrow Holder. Upon receipt of the Escrow copy of the
Sale Agreement, the Escrow Holder shall execute the Acknowledgment of Escrow attached
hereto as Exhibit “D,” by which the Escrow Holder shall acknowledge acceptance of the Escrow
and identify the date of the Opening of Escrow. The Escrow Holder shall immediately thereafter,
by facsimile transmission, deliver copies of the Acknowledgment of Escrow to the City, the
District, and their respective legal counsel.
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Section 4.4 Close of Escrow. As used herein, “Close of Escrow” shall mean the time
of the conveyance of fee title to the Property from the District to the City as contemplated by this
Sale Agreement and evidenced by the recording of a grant deed substantially in the form of
Exhibit “E” attached hereto. Close of Escrow shall occur no later than twenty (20) days after the
expiration of the Due Diligence Period (unless a later Close of Escrow is agreed to in writing by
BAW&GfS7413v2
3042.56 9-15-99 Final 8
the Parties prior to such date) provided that each condition precedent to Close of Escrow referred
to in this Article has been satisfied or waived by the Party benefitting from the condition.
Section 4.5 Sale Agreement to Constitute Escrow Instructions. This Sale Agreement
shall constitute escrow instructions to Escrow Holder.
Section 4.6 SuppZemental Escrow Instructions. The standard escrow instructions of
Escrow Holder, as approved by the District and the City, and to the extent not inconsistent with
the provisions of this Sale Agreement, shall constitute additional escrow instructions to the
Escrow Holder. In addition, within thirty (30) days after the Opening of Escrow, the District and
the City may deposit supplemental, mutually-acceptable escrow instructions into Escrow.
Section 4.7 Ci@ Deposit to Escrow. In addition to satisfying all other of its
obligations specified in this Sale Agreement, on or before one (1) business day prior to Close of
Escrow, the City shall have deposited into Escrow: (i) funds equal to the Purchase Price; (ii) all
other sums and documents reasonably required of the City by the Escrow Holder to effect Close
of Escrow.
Section 4.8 District Deposit to Escrow. In addition to satisfying all other of its
obligations specified in this Sale Agreement, on or before one (1) business day prior to Close of
Escrow, the District shall deposit into Escrow: (i) a grant deed to the Property, substantially in
the form of Exhibit E, properIy executed and in recordable form (“Grant Deed”); and (ii) all other
sums and documents reasonably required of the District by the Escrow Holder to effect Close of
Escrow.
Section 4.9 Conditions Precedent to Close of Escrow. The District’s obligation to
convey the Property to the City, and the City’s obligation to purchase the Property from the
District, are subject to the satisfaction (or written waiver by the benefitting Party) of the
following conditions precedent:
BAW&Gl57473vZ
3042.56 9-l 5-99 Final 9
.-
ta) Escrow and Agreement Not Terminated. Escrow has not been canceled
and/or the Sale Agreement has not been terminated pursuant to Sections 1.4.2 or 1.5.1;
(W .Deposit of Funds. The City and the District have deposited with the
Escrow Holder all funds and documents required to be deposited pursuant to Sections 4.7 and
4.8, respectively;
(cl No Default. The District and the City shall not be in default of any of
their material obligations under this Sale Agreement;
C-4 Truth of Warranties. The warranties and representations of the District
and the City under Articles II and III, respectively, shall be true and correct, which the Escrow
Holder shall presume unless it receives written notice from a Party that it believes a warranty or
representation of the other Party is untrue and incorrect; and
69 TitZe Insurance. Title Insurer is prepared to issue the policy of title
insurance described in Section 4.10.
GJ Ground Lease. The City and the District have executed the Ground Lease
relating to the Property.
Section 4.10 Titfe Policy. The Escrow Holder is hereby instructed to deliver to the City
through Escrow such owner’s policy of title insurance including endorsements, as the City may
request, insuring the City as fee simple owner of the Property, subject only to the usual printed
title company exceptions and the Permitted Exceptions, in an amount equal to the Purchase Price,
issued by the Title Insurer and dated as of Close of Escrow.
Section 4. I1 Recordation of Deed and Delivery of Funds. Upon receipt of the funds
and instruments described in this Article, and upon the satisfaction or waiver of the conditions
precedent to Close of Escrow referred to in this Article, the Escrow Holder shall cause the Grant
BAW&G/57473v2
3042.56 9-15-99 Final 10
Deed to be recorded in the office of the County Recorder. Upon Close of Escrow, the Escrow
Holder shall provide conformed copies of the Grant Deed to the City and the District.
Section 4.12 Taxes. The Property is currently exempt from all property taxes, and the
Parties anticipate that the Property shall be exempt from property taxes after transfer to the City.
The Escrow Holder shall prorate any and all special taxes, assessments, and improvement fees,
charges or assessments levied or imposed on or against the Property, if any, to the Close of
Escrow date.
Section 4.13 Payment of Costs. The costs associated with this transaction shall be paid
as follows:
(4 Title Insurance. The District shall pay an amount equal to the cost of
obtaining a standard form California Land Title Association (“CLTA”) title insurance policy in
the amount of the Purchase Price. Any costs or charges for title insurance in excess of a standard
CLTA policy shall be paid by City.
0 Escrow Costs. The City and the District shall share equally in all costs of
Escrow, including the Escrow Holder’s fee;
(4 Transfer Tax The District shall pay the documentary transfer tax
associated with this transaction, if any; and
(4 Recording. The City shall pay the cost of recording the Grant Deed, if
Section 4.14 Time is of the Essence. Time is of the essence with respect to this Sale
Agreement. Neither the District nor the City shall unreasonably take any action, or unreasonably
fail to take any action, that impedes or delays the Close of Escrow.
BAWBtGl57473v2
3042.56 9-15-99 Final 11
Section 4.15 Escrow Cancellation Charges. Notwithstanding anything in this Sale
Agreement to the contrary, in the event that Close of Escrow fails to occur as a result of default
of either Party, the defaulting Party shall be liable for all Escrow cancellation charges.
ARTICLE V
MISCELLANEOUS PROVISIONS
Section 5.1 Entire Agreement. Neither Party to this Sale Agreement has made any
representations, statements, warranties, or agreements, other than those expressed herein
(including those made with respect to the Lease), to induce the other Party to enter into this Sale
Agreement. Except as expressly provided herein, this Sale Agreement fully and completely
expresses the entire agreement between the Parties hereto with respect to the subject matter
hereof. Except as expressly set forth herein or in the instruments or other documents delivered or
to be delivered hereunder, there are no writings, conversations, representations, warranties, or
agreements that the Parties intend to be a part hereof, and this Sale Agreement represents the
entire agreement between the Parties hereto and supersedes any and all previous written or oral
agreements or discussions between the Parties and any other person or legal entity concerning the
transactions contemplated herein.
Section 5.2 Incorporation of Recitals and Exhibits. All Recitals and all Exhibits
attached hereto and referred to herein are incorporated into and are an operative part of this Sale
Agreement.
Section 5.3 Execution of Other Documents; Compliance with Regulations. The
Parties hereto will do all such other reasonable things and will execute all documents which are
reasonably necessary for Close of Escrow to occur. The Parties shall, at their own expense,
comply with all applicable laws and governmental regulations required for Close of Escrow to
occur, including, but not limited to, any required filings with governmental authorities.
Section 5.4 Affidavit of Non-Foreign Status. The District shall execute and deliver to
the Escrow Holder prior to Close of Escrow an Affidavit of Non-Foreign Status, in a form
BAWBrGl57473v2
3042.56 9-15-99 Final 12
reasonably acceptable to Escrow Holder, as satisfactory evidence that District is not a foreign
entity.
Section 5.5 Attorneys’ Fees. In any action between the District and the City seeking
enforcement or interpretation of any provision of this Sale Agreement or in connection with the
purchase of the Property, the prevailing Party shall be awarded its reasonable costs and expenses,
including, but not limited to, reasonable attorneys’ fees, disbursements, and court costs, in
addition to any damages, injunctive, or other relief awarded.,
Section 5.6 Representation by Independent Counsel. The District and the City
acknowledge that they have been represented by independent legal counsel of their own choice
throughout all negotiations preceding the execution of this Sale Agreement, and that they have
executed this Sale Agreement upon the advice of their own legal counsel.
Section 5.7 Notices. All notices, requests, demands and other communications given
or required to be given under this Sale Agreement shall be in writing, duly addressed to the
receiving Party or Parties as indicated in this Section. Any such notice sent by registered or
certified mail, return receipt requested, shall be deemed to have been duly given and received at
5:00 P.M. two (2) business days after it is so addressed and mailed with postage prepaid. Notice
sent by any other manner, including facsimile transmission, shall be effective only upon actual
receipt thereof. Any Party specified in this Section may change its address for purposes of this
Sale Agreement by giving notice to the other Party and to Escrow Holder in the manner provided
in this Section.
To District: Wy$
Carlsbad Unified School District Bowie, Ameson, Wiles & Giannone
Attention: Superintendent Attention: Wendy H. Wiles
801 Pine Avenue 4920 Campus Drive
Carlsbad, CA 92008 Newport Beach, CA 92660
Fax: (760) 729-8134 Fax: (949) 851-1300
BAW&G/S7473v2
3042.56 9-15-99 Final 13
To Citv:
City of Carlsbad
Community Services Department
Attention: Keith Beverly
1200 Carlsbad Village Drive
Carlsbad, CA 92008- 1989
Fax: (760) 434-7185
City Attorney
Attention: Ronald R. Ball
City Attorney
1200 Carlsbad Village Drive
Carlsbad, CA 92008- 1989
Fax: (760) 434-8367
Kane, Ballmer & Berkman
Attention: Glenn F. Wasserman
5 15 South Figueroa Street, Suite 1850
Los Angeles, CA 90071
Fax: (213) 625-0931
To Escrow Holder:
First American Title Insurance Company
Attention:
411 Ivy Street
San Diego, CA 92101
Fax: (619) 238-5705
.
Section 5.8 Brokerage Fees. The Parties acknowledge that neither Party has retained
the services of a real estate company or broker for any purpose related to this Sale Agreement.
However, any and all commissions, finder’s fees or other compensation with respect to this
conveyance that may be due and owing to any person or entity shall be the responsibility of the
Party that retained those services.
Section 5.9 Assignment. This Sale Agreement shall be binding upon the District and
the City, and their respective heirs, successors or representatives or assigns.
Section 5.10 Waiver. The failure of either Party at any time to require a performance
by the other Party of any provision or requirement of this Sale Agreement shall not affect in any
way the full right to require such performance at any time thereafter. The waiver of any breach
of any provision of this Sale Agreement by the District or the City shall not be deemed to be a
BAWBtGI57473v2
304256 g-15-99 Final 14
waiver of any preceding or subsequent breach of the same or any other provision of this Sale
Agreement.
Section 5.ZI Not for Benefil of Third Parties. This Sale Agreement and every
provision hereof are for the exclusive benefit of the Parties to this Sale Agreement and not for the
benefit of any third Party.
Section 5.12 Governing Law and Venue. This Sale Agreement shall be construed in
accordance with California law. Any litigation, arbitration, mediation, or other proceeding taken
to enforce or interpret this Sales Agreement, or for resolution of any dispute related hereto, shall
be initiated and conducted only in the County of San Diego.
Section 5.13 Section Headings. The Article, Section, and Subsection headings
contained in this Sale Agreement are for purposes of reference only and shall not be construed to
define or limit the meaning of the provisions of this Sale Agreement. Unless specified otherwise,
all references in this Sale Agreement to the words “Article,” “Section,” and “Subsection,”
whether in the singular or plural sense, are references to those contained within this Sale
Agreement.
Section 5.14 Severability. If any Article, Section, Subsection, paragraph, sentence,
clause or phrase contained in this Sale Agreement, for any reason, becomes illegal, null, void or
contrary to public policy, or is held by a court of competent jurisdiction to be illegal, null, void or
contrary to public policy, the remaining Articles, Sections, Subsections, paragraphs, sentences,
clauses or phrases contained in this Sale Agreement shall not be affected thereby. In such an
event, this Sale Agreement shall remain in full force and effect with respect to the remaining
Articles, Sections, Subsections, paragraphs, sentences, clauses or phrases, and shall be
interpreted in accordance with the Parties’ intent in entering into this Sale Agreement.
Section 5.15 Znferpretation Guides. In interpreting this Sale Agreement, it shall be
deemed to have been prepared by the Parties jointly and no ambiguity shall be resolved against
BAW&GI51473v2
3042.56 9-U-99 Final 15
either Party on the premise that the Party or its attorneys was responsible for drafting this Sale
Agreement or any provision hereof.
Section 5.16 Counterparts. This Sale Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which shall constitute one and the
same instrument.
Section 5.17 Date of Sale Agreement. The date entered on page one (1) shall for all
purposes be deemed the date of this Sale Agreement.
In witness of the foregoing, the undersigned execute this Sale Agreement on
behalf of the Party whom they represent.
The Carlsbfd Unified School District
By:
President of the Board of Trustees
Attesf:
By:
Clerk of the Board of Trustees Clerk of the City Council
Mayor
Attest:
By:
Note: Please Notarize Signatures of All Parties
Approved as to Form By: Approved as to Form By:
Bowie, Arneson, Wiles & Giannone Kane, Balhner & Be&man
By:
Glenn F. Wasserman, Legal Counsel
for the City of Carlsbad
BAW&Gl51413v2
3042.56 9-15-99 Final 16
STATE OF CALIFORNIA
COUNTY OF SAN DIEGO
-
1
) ss.
1
within instrument and acknowledged to me that hekh&ky executed the same in hi4k&hen-
authorized capacity&@, and that by his/her&h& signature@% the instrument the person&$, or
the entity upon behalf of which the personM acted, executed the instrument.
WITNESS my hand and offkial seal.
Signatur t&2&-z%. m w4
- _-
State of California
. +&d&@ County of >
SS.
On
personally appeared
,&personally known to me
0 proved to me on the basis of satisfactory
evidence
to be the person
subscribed to IP
whose name
t e within /m is-
instrument and
acknowledged to me that be/she/they executed
the same in kie/herMeir authorized
capacitym and that by bi&er/tbe+
signature&6 the instrument the persowor
the entity upon behalf of which the personw
acted, executed the instrument.
S my hand and official seal.
Placa Notary Seal Above
OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the documenl
and could prevent fraudulent removal and reattachment of this form to another document.
Description of Attached
Title or Type of Document:
Document Date:
Signer(s) Other Than Nam_ed Above:
Capacityties) Claimed by Signer
Signer’s Name:
q Individual
0 Corporate Officer - Title(s):
Cl Partner - Cl Limited El General
q Attorney in Fact
Cl Trustee
0 Guardian or Conservator
Cl Other:
Signer Is Representing:
0 1997 Natllnal Notary Asscclation - 9350 De Sob Ave.. P.O. Box 2402. Chatsworth, CA 913132402 Prod. No. 5907 Reorder. Call Toll-Free i-EOC-8766827
EXHIBIT “A”
[Legal Description of the Property]
EXHIBIT “B”
[Map of Property]
EXHIBIT “C”
[List of All Permanent and Relocatable Buildings and
Other Affixed Improvement on the Property]
[Exclude Any Lease Relocatable Structures]
-.
EXHIBIT “D”
ACKNOWLEDGMENT OF ESCROW OFFICER
The undersigned acknowledges receipt of that certain Agreement for Sale of Real
Property Between the Carlsbad Unified School District and the City of Carlsbad (“Sale
Agreement”) dated - -9 1999, and in accordance therewith states that, on -2 1999, First American Title Insurance Company opened escrow number
(“Escrow”) for purposes of facilitating the transaction(s) contemplated in the Agreement. The
undersigned agrees to act as the Escrow officer pursuant to the terms of the Agreement and any
supplemental Escrow instructions submitted by the Parties pursuant to the provisions of the
Agreement.
By: Date: , 1999
[Name and Title]
EXHIBIT “E”
Recording Requested by and When )
Recorded Mail this Grant Deed 1 and All Tax Statements To: 1
1
The City of Carlsbad
Attention:
Carlsbad, CA 92008
;
1
1 ) Exempt from recording fee pursuant to Government Code 0 6103.
GRANTDEED
For valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Carlsbad Unified School District (“Grantor”) hereby grants to the City of
Carlsbad (“Grantee”), that certain real property located in the County of San Diego, State of
California, more particularly described in Exhibit “A” attached hereto and incorporated herein by
reference (“Real Property”).
In witness whereof, this instrument is executed as of this
1999.
Steve Cade, President of the Board of Trustees
By: && &-
, Clerk of the Board of Trust&s
Note: Please Notarize All Signatures
-
STATE OF CALIFORNIA )
1 ss.
COUNTY OF SAN DIEGO )
authorized capacity@@, and that by hisk&heirsignature@ on the instrument the personti, or
the entity upon behalf of which the person@ acted, executed the instrument.
WITNESS my hand and official seal.
JlDlTH G. CUNNlFf
STATE OF CALJFORNIA )
1 ss.
COUNTY OF SAN DIEGO )
(insert name and title of the officer), personally
personally known to me (e
e-evidence) to be the personQ#whose iske-subscribed to the
within instrument and acknowledged to me that he/-execute same in his-
authorized capacity($), and that by hi- signatureti on the instrument the personH, or
the entity upon behalf of which the personej acted, executed the instrument.
WITNESS my hand and offkial seal.
(Seal)
i
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Carlsbad
1200 Carlsbad Village Drive Carlsbad, California 92008-1989
Attention: City Attorney FREE RECORDING GOVERNMENT CODE SECTION 6103
GROUND LEASE
by and between
and
CARLSBAD UNIFIED SCHOOL DISTRICT
cbad/pine/lease.6 9-21-99
TABLE OF CONTENTS
ARTICLE 1 FUNDAMENTAL INFORMATION . . . . . . . 1.1 Landlord . . . . . . . . . . . . 1.2 Tenant . . . . . . . . . . . . . 1.3 Commencement Date . . . . . . . . 1.4 The Premises . . . . . . . . - .
1.5 Term . . . . . . . . . . . . . .
1.6 Landlord's address for notices .
1.7 Tenant's address for notices . . 1.8 Tenant's rent . . . . . . . . . . 1.9 The specified use of the Property
ARTICLE 2 LEASE TERMS AND PROVISIONS . . . . 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.12.1 2.13 2.14 2.15 2.16 2.17 2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27 2.28 2.29
Agreement to Lease . . . . . Acceptance of Property . . . Term . . . . . . . . . . . . Basic Rent . . . . . : . . . Additional Rent . . . . . . . Rent Generally . . . . . . . Tenant Work . . . . . . . . . Use............. Compliance with Law . . . . . Alterations and Additions . . Repairs . . . . . . . . . . . Taxes............ Notice of Possessory Interest Prohibition Against Transfers Hold Harmless-. . . . . . . Ownership of Property . . . Liens . . . . . . . . . . . Subrogation . . . . . . . . Insurance . . . . . . . . . Utilities . . . . . . . . . Holding Over . . . . . . . Entry by Landlord . . . . . Damage, Reconstruction . . Default . . . . . . . . . . Eminent Domain . . . . . . Estoppel Offset Statement . Hazardous Materials . . . . Recordation . . . . . . . . Quiet Enjoyment . . . . . . General Provisions . . . .
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2 2 3 3 5 5 5 6 6 6 6 6 7 7 8 8 10 11 11 11 13 13 15 16 17 19 19 20 21 21 21 . .
&ad/pine/Lease.6 9-21-99 -i- .
EXHIBITS
EXHIBIT A - LEGAL DESCRIPTION EXHIBIT B - SITE MAP EXHIBIT C - PHOTO OF SITE
cbad/pine/lease.6 9-21-99 -ii-
GROUND LEASE
This GROUND LEASE (the "Lease") is dated as of the CITY OF CARLSBAD ("Landlord" or "City") 1999 between BAD UNIFIED SCHOOL DISTRICT ("Tenant" or "District"), who agree as follows:
ARTICLE 1 FUNDAMENTAL INFORMATION
1.1 Landlord: CITY OF CARLSBAD, a general law city located in the County of San Diego ("County"), State of California ("State") .
1.2 Tenant: CARLSBAD UNIFIED SCHOOL DISTRICT, a school district organized and existing under the laws of the State.
1.3 Commencement Date: The Commencement Date shall be the date set forth in the introductory paragraph, above.
1.4 The Premises: The property leased hereunder (the "Property") is that real property described in the Legal Description attached hereto as E.xhibit "A" and incorporated herein by this reference. The premises consist of the following components (the "Components"), depicted on the Site Map attached hereto as Exhibit "B":
(a) Pine Elementarv School ("Elementarv School") ComDonent, consisting of buildings and grounds used for elementary school instruction and other support functions, and open space, including: 48,400 square feet occupied by permanent buildings and covered walkways, 16,500 square feet occupied by relocatable classrooms and 196,500 square feet occupied by a ball field, soccer field and other open space);
(b) Carlsbad Villase Academv " CVA " Component, consisting of buildings and grounds used as a continuation\alternative education facility for high school age students, occupying 27,600 square feet in a separate fenced area on the southwestern-most portion of the Property; and
( c-1 Maintenance and Operation Yard ("Maintenance Yard") Comoonent, consisting of buildings and grounds which serve as the maintenance facility for the District, occupying 24,000 square feet, completely enclosed with fencing.
1.5 Term: As described in Section 2.3(a), below.
cbad/pine/lease.6 9-21-99 -l-
Landlord's address for notices: 1.6
1.7
City of Carlsbad Community Services Department 1200 Carlsbad Village Drive Carlsbad, California 92008-1989 Attention: Keith Beverly
Fax: (760) 434-7185
With a COPY to:
City Attorney 1200 Carlsbad Village Drive Carlsbad, California 92008-1989 Attention: Ronald R. Ball, City Attorney Fax: (760) 434-8367
Tenant's address for notices:
Carlsbad School District 801 Pine Avenue Carlsbad, California 92008 Attention: Superintendent Fax: (760) 729-8134
With a copy to:
Bowie, Arneson, Wiles & Giannone 4920 Campus Drive Newport Beach, California 92660 Attention: Wendy H. Wiles Fax: (949) 851-1300
1.8 Tenant's rent: As described in Sections 2.4, 2.5. and 2.20, below.
1.9 The soecified use of the Prooertv: For the Term of this Lease, each Component of the Property shall be used exclusively for the uses respectively set forth in Section 1.4 of this Lease, and for no other purpose.
ARTICLE 2 LEASE TERMS AND PROVISIONS
2.1 Aqreement to Lease
(a) Landlord hereby leases the Property to Tenant, and Tenant hereby leases the Property from Landlord, subject to the provisions and conditions herein set forth.
&ad/pine/lease.6 9-21-99 -2-
(b) Except as expressly provided to the contrary in this Lease, reference to the Property is to the land described in the attached Exhibit tlAtt and any and all buildings, structures or other improvements either now or hereafter located on such land, with the exception of those relocatable or portable structures, storage structures and other improvements to be removed by Tenant upon the expiration of the Term of this Lease ("District's Structures".), which are identified in the photo of the Property attached to this Agreement as Exhibit "Cl" which is incorporated herein by this reference. The parties agree that during the Term of this Lease, all buildings, structures and other improvements located on the Property (except District's Structures and personal property) shall be owned in fee by Landlord.
(c) Upon the close of escrow, conveying fee title in the Property from Tenant to Landlord and reconveying a leasehold interest in the Property from Landlord to Tenant, Tenant shall deliver to Landlord all keys to buildings located on the Property, with the exception of the District's Structures, as defined in Section 2.1(b).
2.2 Acceptance of Prooertv. Tenant acknowledges that Tenant has owned the Property and, concurrently with the conveyance to Tenant of the leasehold interest herein, is conveying fee title in the Property to Landlord. Therefore, Landlord makes no representations, express or implied, with respect to the legality, fitness, or desirability of the Property for Tenant's intended use or for any other uses. Tenant shall conduct its own investigation to its satisfaction with respect to zoning, local codes and regulations, and other matters affecting Tenant's ability to use and improve the Property for Tenant's intended use. The Property shall be leased in an- "as is" condition, with no warranty or liability, express or implied, on the part of Landlord as to the condition of any buildings on the Property, the soil (or water), its geology, the existence of known or unknown faults or any other conditions relating to the Property.
2.3 Term
(a) The Lease term (the rrTermN) for all Components shall commence on- the Commencement Date, and shall continue for the following respective periods of time after the Commencement Date, or to the date resulting from an earlier termination as hereinafter set forth:
(1) Elementary School Comoonent: The Term of this Lease shall expire as to the Elementary School Component on December 31, 1999, unless, on or before December 1, 1999, Tenant delivers to Landlord a written notice extending the Term as to the Elementary School Component to and including June 30, 2000 (the "Elementary School Optional Term"). Subject to Tenant's right, at any time, to terminate the Lease as to the Elementary School
cbad/pine/lease.6 9-21-99 -3-
-,
.
Component upon thirty (30) days' written notice to Landlord, the Term shall then automatically expire on June 30, 2000 without any further notice from Landlord. There shall be no extensions beyond the Elementary School Optional Term. Tenant may not renew the Term of this Lease as to the Elementary School Component if, at the time such notice is given, or at the time of the commencement of the Elementary School Optional Term, an Event of Default has occurred in the payment of Rent (as defined below) or in any other material provision of this Lease, Landlord has given written notice of such Event of Default and such Event of Default remains uncured at the expiration of the period within which Tenant may cure such default as provided in this Lease. Nothing herein shall be construed to waive or limit Landlord's right to terminate this Lease upon any Event of Default by Tenant (including any default in addition to failure to pay Rent) as provided in this Lease, notwithstanding Tenant's exercise of its right to renew hereunder regardless of such other default.
(2) CVA Comoonent: The Term of this Lease shall expire as to the CVA Component on June 30, 2001. There shall be no extensions of the Term.
(3) Maintenance Yard Component: The Term of this Lease shall expire as to the Maintenance Yard Component on June 30, 2001. There shall be no extensions of the Term.
(b) Termination. Subject to Section 2.23, below, Landlord may terminate this Lease as to any and all Components by giving written notice of termination to Tenant, in the event of any Default under this Lease (as provided in Section 2.23 hereof) that is not cured within the applicable cure period.
(cl Surrender.
(1) Subject to the damage and reconstruction provisions of Section 2.22, Tenant shall upon the expiration or sooner termination of this Lease surrender the Property to Landlord in good and clean condition, ordinary wear and tear excepted, including any buildings, structures, improvements or additions then located on the Property.
(2) Upon the termination of this Lease as to a Component, Tenant shall promptly remove from the Property, at Tenant's sole cost and expense, all District's Structures, as defined in Section 2.1(b), and personal property located on the applicable Component. In the case of the Elementary School Component, all District's Structures and personal property shall be removed by Tenant in any event not later than June 30, 2000.
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(3) Any District's Structures, as defined in Section
2.1 (b), and 'personal property not removed from the Property by Tenant as provided in subparagraph (c) (2) shall be removed by Landlord at the cost and expense of Tenant, or shall become the property of the Landlord. Tenant shall reimburse Landlord for all costs incurred by Landlord pursuant to this subparagraph (3), including Landlord's reasonable administrative costs. Tenant's obligations pursuant to this subparagraph (3) shall survive the termination of this Lease.
(4) Upon the termination of this Lease as to the Maintenance Yard Component, Tenant shall promptly remove from the Property and remediate, as applicable, at Tenant's sole cost and expense, and in accordance with all applicable government requirements, all hazardous materials or toxic substances related to or used in connection with the maintenance function (i.e., paint, oil, pesticides, etc.). Any hazardous materials or toxic substances that are not removed from the Property and/or remediated by Tenant as provided in this subparagraph (c) (4) shall be removed and/or remediated by Landlord at the cost and expense of Tenant. Tenant shall reimburse Landlord for all costs incurred by Landlord pursuant to this subparagraph (4), including Landlord's reasonable administrative costs. Tenant's obligations pursuant to this subparagraph (4) shall survive the termination of this Lease.
2.4 Basic Rent. Subject to Section 2.20, Tenant shall pay to Landlord, as rent for the Property, the amount of One Dollar ($1.00) per year.
2.5 Additional Rent. In addition to any Annual Basic Rent that is due pursuant to this Lease, Tenant shall pay to Landlord, as additional consideration for the lease of the Property, any sums described in this Lease as "Additional Rent."
Rent Generally
(a) All Rent (including Basic, Additional and Holding Over) shall be paid absolutely net to Landlord, so that this Lease shall yield to Landlord the full amount of the Rent throughout the Term of this Lease. This Lease is and shall be a "Pure Net" or "Triple NetlL lease, as such terms are commonly used in the real estate industry, it being intended that Tenant shall pay all costs, expenses and charges arising out of the use, occupancy and operation of the Property.
(b) All payments of Rent and of other sums to be paid by Tenant to Landlord pursuant to this Lease shall be paid in lawful money of the United States of America, at Landlord's address set forth above, or at such other place within the United States or to such other person, firms or corporations as Landlord from time to time may designate in writing. Except as otherwise expressly provided by the terms of this Lease, Landlord and Tenant agree that
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all sums payable hereunder to or on behalf of Landlord shall be paid without. notice or demand.
(c) Should Tenant fail, for whatever reason, to make any rental payment required hereunder, then Tenant shall pay an Additional Rent equal to 4% per annum on the amount due, until paid; provided, however, that nothing in this paragraph (c) shall be deemed to limit any of Landlord's other rights or remedies under this Lease or otherwise available at law or in equity.
2.7 Tenant Work. Tenant shall, at its own cost and expense, undertake and complete any maintenance, repair, rehabilitation or reconstruction of the improvements undertaken by Tenant during the Term hereof. In the conduct of such work, Tenant shall comply with any and all applicable City rules, regulations, or requirements.
2.8 Use
(a) Tenant shall use the Property only for the specified uses set forth in Section 1.4, above, and shall not use or permit the Property to be used for any other purposes. Tenant shall not cause, maintain, or permit any nuisance or waste in, on, or about the Property, normal wear and tear excepted.
(b) Tenant covenants and agrees there shall be no discrimination against any person, or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin or ancestry in the use, occupancy, tenure or enjoyment of the Property, nor shall Tenant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination.
2.9 Compliance with Law. Tenant shall not use the Property or permit anything to be done in or about the Property which will in any way conflict at that time with any applicable law, statute, ordinance, or governmental rule, regulation or requirement now in force or which may hereafter be enacted or promulgated.
2.10 - Alterations and Additions. Tenant shall not make or suffer to be made any alterations, additions, or improvements to or on the Property or any building or structure thereon or any part thereof without the prior written consent of Landlord.
2.11 ReDairS. Tenant shall, without cost or expense to Landlord, (a) keep and maintain any buildings on the Property in good condition and repair, ordinary wear and tear excepted, and keep and maintain the remaining portions of the Property in at least the same condition it was in on the Commencement Date, ordinary wear and tear excepted; and (b) undertake such maintenance
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of the Property from time to time as may be reasonable and
customary under the circumstances.
2.12 Taxes
(a) Payment bv Tenant. To the extent applicable, Tenant shall promptly pay, at least five (5) days prior to delinquency, all real estate and real property taxes, or possessory interest tax, assessed against the Property. In addition, to the extent applicable, Tenant shall, during the term of this Lease, pay any levy for the installation, maintenance or operations of local improvements affecting the Property as may be assessed by any governmental boards or bureaus having jurisdiction thereof.
(b) Contest. Tenant shall have the right, by appropriate proceedings, to protest or contest in good faith any assessment or re-assessment of taxes, any special assessment, or the validity of any taxes or of any change in assessment or tax rate; provided, however, prior to any such challenge Tenant must either (a) pay the taxes alleged to be due in their entirety and seek a refund from the appropriate authority, or (b) post bond in
an amount sufficient to insure full payment of the taxes.
(c) Personal Propertv Taxes. To the extent applicable, Tenant shall pay any and all personal property taxes assessed against equipment, trade fixtures, inventory, or other personal property located in, on, or about the Property. Tenant shall indemnify, defend, and hold Landlord and the Property harmless from and against any such personal property taxes.
2.12.1 Notice of Possessorv Interest
(a) In accordance with California Revenue and Taxation Code Section 107.6(a), Landlord states that by entering into this Lease, a possessory interest subject to property taxes may be created. Tenant or other party in whom the possessory interest is vested may be subject to the payment of property taxes levied on such interest.
(b) Without limiting the foregoing, in the event the Property and/or the improvements thereon, or any possessory interest therein, should at any time be subject to ad valorem taxes or assessments levied, assessed or imposed on such property, Tenant shall pay taxes and assessments upon the assessed value of the entire property, and not merely upon the assessed value of its leasehold interest.
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2.13 Prohibition Against Transfers.
(a) Tenant shall not, under any circumstances, without the express prior written approval of Landlord, transfer or sublease Tenant's interest in the Property or any portion thereof, or attempt to assign or transfer all or any portion of its interest in this Lease. Any attempted transfer or subleasing of the Property or any portion thereof or interest therein, or assignment of this Lease, which is not expressly approved in writing by Landlord shall be void and of no force or effect and, at the option of Landlord, shall terminate this Lease.
(b) Prior to the expiration or earlier termination of this Lease as to the Elementary School Component, Landlord shall not, under any circumstances, without the express prior written approval of Tenant, transfer or lease any portion of the Property, or attempt to assign or transfer all or any portion of the Property, to another party. Any attempted transfer or leasing of the Property or any portion thereof or interest therein, or assignment of this Lease, which is not expressly approved in writing by Tenant shall be void and of no force or effect and, at the option of Tenant, shall terminate this Lease. Notwithstanding this paragraph (b), Landlord shall have the right to continue to operate existing programs on any portion of the Property as they currently are operated, or may institute additional programs after school hours and on week-ends; however, Landlord's use of the Property shall not interfere with Tenant's occupancy or quiet enjoyment of the Components then leased by Tenant. Upon the expiration or earlier termination of this Lease as to the Elementary School Component, Landlord shall have the right to lease or otherwise dispose of the remaining school buildings for any purpose and in such manner as Landlord may determine, in its sole discretion.
2.14 Hold Harmless
(a) Tenant shall indemnify, defend, and hold Landlord harmless from and against any and all costs, claims, demands, actions, causes of action, liability, loss, or damage, including attorneys' fees and costs (collectively referred to as tVClaimstl and, Claims that are made by third parties, collectively referred to as "Third Party Claims") whether for injury to or death or persons or damage to real or personal property or otherwise, arising out of or in connection with Tenant's use or occupancy of the Property, any activity, work, or other thing done, permitted, or suffered by Tenant in or about the Property, or arising from any reason or cause whatsoever in connection with the use or occupancy of the Property by any party during the Term of this Lease, except Landlord's uses under Section 2.13(b). The provisions of the preceding sentence shall not apply with respect to any negligent or intentional acts or omissions of Landlord and its agents, servants, contractors and employees (collectively, "Landlord Parties"), and
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shall apply as to any Component only until Tenant vacates such Component. Tenant shall further indemnify, defend, and hold Landlord harmless from and against any and all Third Party Claims arising from any breach or default in the performance of any obligation on Tenant's part to be perfo:aed under the terms of this Lease or arising from any act or negligence of Tenant or any officer, agent, employee, guest, or invitee of Tenant. In any case, action, or proceeding brought against Landlord or involving Landlord by reason of any such Claim, Tenant upon notice from Landlord shall defend the same at Tenant's expense by counsel reasonably satisfactory to Landlord. Tenant, as a material part of the consideration to Landlord, hereby assumes all risk of damage to property or injury to persons in, upon, or about the Property from any cause other than the negligent or intentional acts or omissions of Landlord Parties, and Tenant hereby waives all claims in respect thereof against Landlord. Tenant's obligation to indemnify under this paragraph shall include attorneys' fees, investigation costs, and other reasonable costs, expenses, and liabilities incurred by Landlord. If the ability of Tenant to use the Property is interrupted for any reason, Landlord shall not be liable to Tenant for any loss or damages occasioned by such loss of use unless caused by the negligent or intentional acts or omissions of Landlord Parties.
(b) Landlord or its agents shall not be liable for loss or damage to any property by theft or otherwise, nor for any injury to or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, or rain which may leak from any part of the Property while Tenant is leasing such
part, or from the pipes, appliances, or plumbing works therein or from the roof, street, or subsurface or from any other place resulting from dampness or any other cause whatsoever, unless caused by or due to the negligent or intentional acts or omissions of Landlord Parties. Tenant shall give prompt notice to Landlord in case of fire or accidents in the Property or of defects therein or in the fixtures or equipment.
(cl Landlord shall indemnify, defend, and hold Tenant harmless from and against any and all costs, claims, demands, actions, causes of action, liability, loss, or damage, including attorneys' fees and costs (collectively referred to as “Claimsfl and, Claims that are made by third parties, collectively referred to as "Third Party Claims") whether for injury to or death or persons or damage to real or personal property or otherwise, arising out of or in connection with Landlord's use or occupancy of the Property under Section 2.13(b). The provisions of the preceding sentence shall not apply with respect to any negligent or intentional acts or omissions of Tenant and its agents, servants, contractors and employees (collectively, "Tenant Parties"). Landlord shall further indemnify, defend, and hold Tenant harmless from and against any and all Third Party Claims arising from any breach or default in the performance of any obligation on
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Landlord's part to be performed under the terms of this Lease or arising from any act or negligence of Landlord or any officer, agent, empldyee, guest, or invitee of Landlord. In any case, action, or proceeding brought against Tenant or involving Tenant by reason of any such Claim, Landlord upon notice from Tenant shall defend the same at Landlord's expense by counsel reasonably satisfactory to Tenant. Landlord, as a material part of the consideration to Tenant, hereby assumes all risk of damage to property or injury to persons in, upon, or about the Property arising out of or in connection with Landlord's use or occupancy of the Property under Section 2.13(b), from any cause other than the negligent or intentional acts or omissions of Tenant Parties, and Landlord hereby waives all claims in respect thereof against Tenant. Landlord's obligation to indemnify under this paragraph shall include attorneys' fees, investigation costs, and other reasonable costs, expenses, and liabilities incurred by Tenant. If the ability of Landlord to use the Property under Section 2.13(b) is interrupted for any reason, Tenant shall not be liable to Landlord for any loss or damages occasioned by such loss of use unless caused by the negligent or intentional acts or omissions of Tenant Parties.
2.15 Ownershio of Prooertv
(a) During the Term of this Lease, all buildings, structures, fixtures, additions and improvements located on the Property (except District's Structures, as defined in Section 2.1(b), and/or personal property) shall be owned in fee by Landlord.
lb) Upon the expiration or termination of this Lease, all buildings, structures, fixtures, additions, equipment, improvements and any other real property whatsoever located on the Property shall be surrendered with the Property, but not including District's Structures, as defined in Section 2.1(b), and/or personal property that is removed from the Property by Tenant.
(c) Upon termination of this Lease, whether by expiration of the Term or otherwise, the improvements on the Property, and all personal property not removed by Tenant (including all District's Structures, as defined in Section 2.1(b), and/or other personal property), shall, without compensation to Tenant, then become Landlord's property, free and clear of all claims to or against them by Tenant or any third person, firm or entity, except if Landlord elects to cause such District's Structures and/or other personal property to be removed from the Property, at Tenant's sole cost and expense.
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2.16 Liens. Except as otherwise provided herein, Tenant shall not create or permit any lien or encumbrance to be attached to or affect the Property by reason of any act or omission of Tenant. Tenant shall indemnify and hold harmless Landlord and the Property against any such lien, encumbrance, or claim of lien or encumbrance, and against any costs in connection therewith, including attorneys' fees. a
2.17 Subrosation
Neither Landlord nor Tenant shall be liable to the other or to any insurance company (by way of subrogation or otherwise) insuring the other party for any loss or damage to any building, structure, or other tangible property, or any resulting loss of income, or losses under worker's compensation laws and benefits (even though such loss or damage might have been occasioned by the negligence of such party, its agents, or employees), to the extent any such loss or damage is covered by insurance proceeds received by the party suffering the loss or damage. Landlord and Tenant hereby mutually release each other from liability and waive all right to recover against each other or against officers, employees, agents or representatives of each other for any loss or damage to any person or property caused by or resulting from risks to the extent of proceeds paid against or under any insurance policies carried by the parties; provided, however, this paragraph shall be inapplicable if it would have the effect, but only to the extent that if would have the effect, of invalidating any insurance coverage of Landlord or Tenant. The parties shall, to the extent available, cause each insurance policy obtained here under to provide a waiver of subrogation.
2.18 Insurance
(a) Casualtv Insurance. . Tenant shall procure and maintain in force at all times during the Term of this Lease at its cost a policy or policies of fire and extended coverage insurance (all risk of physical loss) covering those Components leased by Tenant, in an amount equal to one hundred percent (100%) of the full replacement cost (using materials of a like quality and kind as existed immediately prior to the damage or destruction) of the Property. This insurance shall include endorsements for inflation, debris removal and demolition, building ordinance protection, and plate glass coverage with respect to the Property. Landlord shall be named as an additional insured on the insurance, and the proceeds of any such policy or policies of insurance shall be held and utilized in accordance with the provisions of Section 2.22. of this Lease.
(b) Liabilitv. Tenant shall also procure and maintain at all times during the Term hereof at its cost commercial general liability insurance against any liability arising out of Tenant's use, occupancy, or maintenance of those Components leased by Tenant
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and all areas appurtenant thereto, including without limitation personal inj.ury and death. Such insurance shall be in an amount not less than $5,000,000 per occurrence, combined single limit, increased every five (5) years by the percentage increase, if any, in the Consumer Price Index from the Commencement Date of this Lease. This policy shall include broad form contractual liability and indemnity coverage which shall insure performance by Tenant of the indemnity and defense provisions set forth in this Lease. The limits of said insurance shall not, however, be construed to limit the liability of Tenant under this Lease.
(cl Worker's Compensation. Tenant shall procure and maintain at all times during the Term of this Lease at its cost (i) worker's compensation coverage, in the amount required by law, (ii) personal injury insurance with endorsement deleting the employee liability exclusion, and (iii) employer's liability coverage in the amount of $l,OOO,OOO for each accident or occurrence, increased every five (5) years by the percentage increase, if any, in the Consumer Price Index from the Commencement Date of this Lease. The worker's compensation insurance and the employer's liability coverage shall cover any person or entity employed directly or indirectly by Tenant, any agent acting on behalf of Tenant, and anyone for whose acts Tenant may be liable.
(d) Deductibles. The deductible amounts per claim or occurrence, if any, with respect to all insurance which Tenant is required to maintain hereunder shall not exceed $20,000 per claim or occurrence, increased every five (5) years by the percentage increase, if any, in the Consumer Price Index from the Commencement Date of this Lease. The amount of the deductibles, if any, within this limitation shall be a business decision by Tenant; under no circumstances shall Landlord be required to reimburse Tenant for the amount of any deductible incurred by Tenant in connection with any insured event, even if the event resulting in the claim was caused or contributed to by Landlord or its agents, servants, or employees.
(e) Occurrence Basis. All insurance which Tenant is required to maintain hereunder shall be on an occurrence basis and shall be with insurance companies having a Best's Insurance Guide rating of A--:V or better.
(f) Reuuirements. As applicable, the insurance required pursuant to this Lease shall: (1) name Landlord and its officers, employees, volunteers, contractors and agents as additional insureds as their interests appear; (2) provide that the coverage thereof is primary and non-contributory coverage with respect to all additional insureds; (3) contain a Standard Cross Liability endorsement providing that the insurance applies separately to each insured against whom a claim is filed, and that the policy covers claims or suits by one insured against the other; (4) provide that the interests and protections of the additional insureds shall not
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be affected by any misrepresentation, act or omission of a named insured or any breach by a named insured of any provision in the policy which would otherwise result in forfeiture or reduction of coverage; and (5) terminate as to each Component at such time as such Component is no longer leased by Tenant.
(9) Certificates of Insurance. Within five (5) days prior to the execution of this Lease, Tenant shall notify Landlord in writing of the name of Tenant's insurer. Tenant shall deliver to Landlord prior to entry on the Property by Tenant certificates of insurance evidencing the existence and amount of such insurance, and showing Landlord (and the other parties designated in paragraph (f), above) as an additional insured on all policies; provided that in the event Tenant fails to procure and maintain such insurance, Landlord may (but shall not be required to) procure same at Tenant's expense. No policy shall be cancelable or subject to reduction of coverage or other modification except after thirty (30) days prior written notice to Landlord by the insurer (or such shorter period of time for such notice as may be the commercial custom and practice in such policies). Tenant shall, within twenty (20) days prior to the expiration of such policies, furnish Landlord with renewals or binders, or Landlord may order such insurance and charge the cost to Tenant, which amount shall be payable by Tenant upon demand. All such policies shall be written as primary policies, not contributing with and not in excess of coverage which Landlord may carry, and all policies shall include Tenant's employees as additional insureds. Tenant shall have the right to provide such insurance coverage pursuant to blanket policies obtained by Tenant provided that such blanket policies expressly afford coverage to the Property and to Tenant and Landlord as required by this Lease. Tenant shall, upon request from Landlord, immediately deliver to Landlord copies of all insurance policies (including the declarations pages) in effect with respect to Tenant's business and the Property.
2.19 Utilities
Tenant shall make all arrangements for and pay for all services and utilities to the Components leased by Tenant; Landlord shall not be responsible or liable to Tenant for interruption or stoppages of- utilities or other services to the Property, except due to the negligent and/or intentional acts or omissions of Landlord.
2.20 Holdins Over
(a) Elementarv School Comnonent.
(1) Except in the event Tenant has extended the Term as' to the Elementary School Component as provided in Section 2.3(a) (1) of this Lease, in the event Tenant fails to vacate the Elementary School Component at the end of the Term
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(i.e., December 31, 1999), Tenant shall be liable for and shall pay to Landlord.upon demand: (a) a rental for the Elementary School Component in the amount of Four Thousand Fifty-Six Dollars and Twenty-Five Cents ($4,056.25) per month (the "Elementary School Holding Over Rent"), retroactive to the Commencement Date and continuing every month until Tenant vacates the Elementary School Component, up to June 30, 2000 (after which, the Holding Over Rent amount set forth in paragraph (3), below, shall apply), which is based on a rent of $0.75 per square foot times 64,900 square feet (i.e., 48,400 square feet of the Elementary School Component which is occupied by permanent buildings and covered walkways, and 16,500 square feet of the Elementary School Component which is occupied by relocatable classrooms), for an annual rent of $48,675 per year; and (b) all damages incurred by Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person.
(2) Notwithstanding the expiration or earlier termination of the Term of this Lease as to the Elementary School Component and notwithstanding any other provision of this Lease, so long as any leased portable structure remains on the Elementary School Component, Tenant shall continue to be obligated to pay the full amount of the Elementary School Basic Rent to Landlord.
(3) In the event Tenant elects to extend the Term of the Lease as to the Elementary School Component and Tenant fails to vacate the Elementary School Component at the end of the Elementary School Optional Term (i.e., June 30, 2000), the Elementary School Component Holding Over Rent shall be the amount of Four Thousand Six Hundred and Sixty-Four Dollars and Sixty-Nine Cents ($4,664.69) per month (the "Elementary School Extended Term Holding Over Rent"), commencing July 1, 2000 and continuing every month until Tenant vacates the Elementary School Component, which is based on a rent of $0.8625 per square foot times 64,900 square feet, for an annual rent of $55,976.25 per year, which shall be increased by fifteen percent (15%) per year thereafter until Tenant vacates the Elementary School Component.
(b) CVA Comoonent. In the event Tenant fails to vacate the CVA Component at the end of the Term (i.e., June 30, 2001), Tenant shall be liable for and shall pay to Landlord upon demand: (i) a rental for the CVA Component in the amount of One Thousand Seven Hundred Twenty-Five Dollars ($1,725.00) per month (the "CVA Holding Over Rent"), retroactive to the Commencement Date and continuing every month until Tenant vacates the CVA Component, which is based on a rent of $0.75 per square foot times 27,600 square feet for an annual rent of $20,700 per year, which shall be increased by fifteen percent (15%) per year thereafter until Tenant vacates the CVA Component; and (ii) all damages incurred by
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Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person.
(cl Maintenance Yard Component. In the event Tenant fails to vacate the Maintenance Yard Component at the end of the Term (i.e., June 30, 2001), Tenant shall be liable for and shall pay to Landlord upon demand: (i) a rental for the Maintenance Yard Component in the amount of One Thousand Five Hundred Dollars ($1,500.00) per month (the "Maintenance Yard Holding Over Rent"), retroactive to the Commencement Date and continuing every month until Tenant vacates the Maintenance Yard Component, which is based on a rent of $0.75 per square foot times 24,000 square feet for an annual rent of $18,000 per year, which shall be increased by fifteen percent (15%) per year thereafter until Tenant vacates the Maintenance Yard Component; and (ii) all damages incurred by Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person.
2.21 Entrv bv Landlord
In addition to Landlord's right to enter those portions of the Property on which Landlord operates programs as provided in Section 2.13(a)(2) of this Lease, Landlord reserves and shall at any and all times have the right, but not the obligation, to enter the Property, for the following purposes: (a) to respond to any emergency situation; (b) to inspect the Property, provided such inspections shall take place during normal business hours and upon not less than 24 hours' notice, except for inspections deemed necessary by Landlord to respond to any emergency situation, which inspections may occur at any time, and for which no advance notice shall be required; (c) to post notices of non-responsibility; and (d) to make repairs to the Property, without any obligation to do
so, subject to notice to Tenant, and a reasonable opportunity to cure, as provided in Section 2.23(b) hereof, except for repairs deemed necessary by Landlord to respond to any emergency situation, for which no notice or opportunity to cure shall be required. Provided, however, that Landlord shall take all reasonable steps to ensure that Tenant's operations shall not be interfered with unreasonably. Landlord agrees to defend and hold Tenant harmless for any and all claims, liability and damages arising out of any activity by Landlord on the Property, except to the extent caused by the negligence or willful misconduct of Tenant. Except as provided in the previous sentence, Tenant hereby waives any claim for damages for any injury or inconvenience to or interference with Tenant, any loss of occupancy or quiet enjoyment of the Property, and any other loss which may occur pursuant to Landlord's entry under this Section 2.21. Landlord shall have the right to use any and all means which Landlord may deem proper to open doors in an emergency in order to obtain entry to the Property, without liability to Tenant except for any failure to exercise due care for Tenant's property. Any entry to the Property obtained by Landlord by any means for the purposes specified above shall not under any
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circumstances be construed or deemed to be forcible or unlawful entry into, or a detainer of, the Property or an eviction of Tenant from the Property or any portion thereof.
2.22 Damage, Reconstruction
(a) Covered bv Insurance. In the event the Property is damaged by fire or other perils covered by extended coverage insurance, Tenant shall have the right to use all available insurance proceeds to repair or rebuild the improvements on the Property. If the estimated cost of repairs (including lost rent) is not in excess of available insurance proceeds (including rent loss insurance proceeds), then Tenant shall forthwith repair the
same (using the insurance proceeds to pay the cost of such repair) and this Lease shall remain in full force and effect.
(b) Not Covered bv Insurance.
(i) In the event the Property is damaged as a result of any cause other than the perils covered by fire and extended coverage insurance, or the estimated cost of repairs (including lost rent) is in excess of available insurance proceeds (including rent loss insurance proceeds), then Tenant shall notify Landlord in writing of the amount by which the estimated cost of repairs exceeds such proceeds (the l'ShortfalllV), and Tenant shall have the right, within ninety (90) days after receipt of such notice, to elect to provide the Shortfall and proceed with such repairs (using the insurance proceeds and such other funds as Tenant may provide to pay the Shortfall), in which case this Lease shall continue in full force and effect.
(ii) If Tenant fails to notify Landlord within such ninety -.(90) -day period that it will provide the Shortfall and conduct the repairs, then Landlord shall have the option, within thirty (30) days from the end of the ninety (90) day period described in clause (i), either to (A) provide the Shortfall at Landlord's sole expense and direct Tenant to repair or restore such damage (using the insurance proceeds and such additional funds as Landlord may provide to pay the Shortfall), with this Lease continuing in full force and effect, or (B) give notice to Tenant terminating -this Lease as of the date specified in such notice, which date shall be no less than thirty (30) and no more than sixty (60) days after the giving of such notice of termination. In the event of giving such notice of termination, this Lease shall expire and all interest of Tenant in the Property shall terminate on the date so specified in such notice.
(cl Soecial Termination Rishts. Notwithstanding anything to the contrary contained in this Section, Tenant shall have no obligation whatsoever to repair, reconstruct, or restore the Property, and Landlord shall have no right to instruct Tenant to do so, in either of the following circumstances: (i) the damage
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occurs during the last six (6) months of the Term of this Lease, or (ii) the damage cannot reasonably be expected to be repaired within six (6) months. In that event, Tenant may at its option terminate this Lease upon (30) days written notice to Landlord that Tenant elects not to repair, reconstruct, or restore the Property.
(d) Excess Insurance ,Proceeds. If completion of required repair, reconstruction or restoration of the Property does not utilize all insurance proceeds, then Tenant may retain such unused proceeds. If, for any reason, Tenant does not repair, reconstruct or restore the Property, except if authorized by Landlord, or pursuant to subsection (cl, above, the insurance proceeds shall belong to Landlord as its property.
(e) Tenant shall not be entitled to any compensation or damages from Landlord for loss of the use of the whole or any part of the Property, Tenant's personal property, or any inconvenience or annoyance occasioned by such damage, repair, reconstruction, or restoration, except as is due to Landlord's negligent and/or intentional acts or omissions. Tenant waives the provisions of California Civil Code sections 1932(2) and 1933(4) with respect to any destruction of the Property.
2.23 Default
(a) Subject to the notice and cure provisions of this Section 2.23(d) and 2.23(e), failure by either Party to observe or perform any covenants, conditions, or provisions of this Lease to be observed or performed by such Party shall constitute a default and breach of this Lease. The defaulting Party must immediately commence to cure, correct or remedy any such failure or delay and shall complete such cure, correction or remedy with reasonable diligence.
(b) The non-defaulting Party shall give written notice of default to the Party in default, specifying the default complained of by the non-defaulting Party. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. Except as otherwise expressly provided in this Lease, any failures or delays by either party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies. Delays by either party in asserting any of its rights and remedies shall not deprive either party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies.
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(c) If a monetary event of default occurs, prior to exercising any remedies hereunder, Landlord shall give Tenant written notice of such default. Tenant shall have a period of seven (7) calendar days after such notice is received or deemed received within which to cure the default prior to exercise of remedies by Landlord. Notwithstanding any provision of this Lease, Landlord shall not be required to deliver written notice to Tenant as a condition to Tenant's obligations to pay any rent hereunder. If any payment is not received by Landlord within seven (7) calendar days following the due date thereof, then in addition to the remedies conferred upon Landlord pursuant to this Lease, a late charge of ten percent (10%) of the amount due and unpaid will be added to the delinquent amount to compensate Landlord for the expense of handling the delinquency, computed from the date on which the amount was due and payable until paid.
Cd) If a non-monetary event of default occurs, prior to exercising any remedies hereunder, the non-defaulting Party shall give the party in default notice of such default. If the default is reasonably capable of being cured within thirty (30) calendar days after such notice is received or deemed received, the Party in default shall have such period to effect a cure prior to exercise of remedies by the non-defaulting Party. If the default is such that it is not reasonably capable of being cured within thirty (30)
days, and the Party in default (i) initiates corrective action within said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as possible, then the Party in default shall have such additional time as is reasonably necessary to cure the default prior to exercise of any remedies by the non- defaulting Party. In no event shall Landlord be precluded from exercising remedies if the security of its fee interest in the Property becomes or is about to become materially jeopardized by any failure to cure a default. In no event shall either non- defaulting Party be precluded from exercising remedies if the default is not cured within ninety (90) days after the first notice of default is given.
(e) Any notice of default that is transmitted by electronic facsimile transmission followed by delivery of a @lhardlV
copy, shall be deemed delivered upon its transmission, provided if such facsimile is received on a nonbusiness day or after 5:00 p.m. on a business day, receipt shall be deemed to have occurred on the next business day; any notice of default that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), shall be deemed received on the documented date of receipt by Tenant; and any notice of default that is sent by registered or certified mail, postage prepaid, return receipt required shall be deemed received on the date of receipt thereof.
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(f) If any default or breach is not cured by Tenant within the respective period of time provided in paragraphs (c) and (d) of this Section 2.23, then Landlord shall be entitled to exercise any and all rights or remedies which may be available at law or in equity, including terminating this Lease. Any and all rights or remedies available to Landlord shall be cumulative, and not alternative.
(9) In any case where, after notice of default is given to Tenant pursuant to this Section 2.23 and Tenant has not cured such default within the respective times provided for such cure in this Lease, then Landlord shall have the following rights and remedies:
(il Landlord shall have the right to seek money damages against Tenant;
(ii) Landlord shall have the right to seek injunctive relief and/or specific performance of any obligation of Tenant hereunder;
(iii) Landlord shall have the right to cure the default, in which case, Tenant shall reimburse all costs and expenses incurred by Landlord in connection therewith, immediately upon demand, plus interest at the rate of ten percent (10%) per annum.
(iv) Landlord shall have the right to terminate this Lease.
2.24 Eminent Domain. If the Property or any portion thereof is taken under the power of eminent domain, or sold by Landlord under the threat of the exercise of such power, this Lease shall terminate as of the date that the condemning authority takes possession of the Property. Tenant hereby waives any claim to any and all awards for the taking of any part of the Property or proceeds from the sale made under the threat of the exercise of the power of eminent domain.
2.25 - Estoonel Offset Statement
(a) Tenant shall, at any time and from time to time upon not less than twenty (20) days' prior written notice from Landlord, execute, acknowledge, and deliver to Landlord a statement in writing certifying that this Lease is unmodified and in full force and effect (or, if modified, is in full force and effect, and stating the modifications) and acknowledging that there are not, to Tenant's knowledge, any uncured defaults on the part of Landlord hereunder (or specifying such defaults if any are claimed) and such other matters as may be reasonable and customary or as needed to clarify any provision of this Lease.
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(b) Landlord shall, at any time and from time to time upon not less than twenty (20) days' prior written notice from Tenant, execute, acknowledge, and deliver to Tenant a statement in writing certifying that this Lease is unmodified and in full force and effect (or, if modified, is in full force and effect, and stating the modifications) and acknowledging that there are not, to Landlord's knowledge, any uncured defaults on the part of Tenant hereunder (or specifying such defaults if any are claimed), the last date Landlord received rent under this Lease, the date such rent was due and the amount thereof, acknowledging that the recipient will rely on the certificate, and such other matters as
may be reasonable and customary or as needed to clarify any provision of this Lease.
2.26 Hazardous Materials
(a) Except to the extent it is normal and customary to do so during the construction or operation of educational property, Tenant shall not:
(i) Make, or permit to be made, any use of the Property, or any portion thereof, which emits, or permits the emission of dust, sweepings, dirt, cinders, fumes, or odors into the atmosphere, the ground, or any body of water, whether natural or artificial, in violation of applicable law;
(ii) Discharge, leak, or emit, or permit to be discharged, leaked, or emitted, any liquid, solid, or gaseous matter, or any combination thereof, into the atmosphere, the ground, or any body of water, in violation of applicable law; or
(iii) Use, store or dispose of on the Property any solid, liquid, or gaseous matter, or any combination thereof, which is, or may become, hazardous, toxic, or radioactive including, but not limited to, those materials listed in Sections 66680 through 66685 of Title 22 of the California Administrative Code, Division 4, Chapter 30 (as may be amended from time to time), in violation of applicable collectively law h~~~llnof the foregoing referred to as "Hazardous Materials").
(b) Tenant shall not keep any trash, garbage, waste, or other refuse on the Property except in sanitary containers and shall regularly and frequently remove the same from the Property. Tenant shall keep all incinerators, containers, and other equipment used for the storage or disposal of such matter in a clean and sanitary condition. Tenant shall surrender the Property at the expiration or termination of this Lease free of any Hazardous Materials or contamination caused by Tenant's activities, and free
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.
and clear of all judgements, liens, or encumbrances and shall, at its own cost.and expense, repair all damage and clean up or perform any remedial action necessary relating to any Hazardous Materials or contamination caused by Tenant's activities. Tenant shall, at its sole cost and expense remediate in accordance with law and/or remove any alterations or improvements that may be contaminated or may contain Hazardous Materials caused by Tenant's activities.
(cl Tenant shall indemnify, defend, and hold Landlord harmless from and against (i) any and all claims, demands, judgments, damages, actions, causes of action, injuries,
administrative orders, consent agreements and orders, liabilities,
penalties, costs, and expenses of any kind whatsoever (collectively referred to as tlClaimst* and, Claims that are made by third parties, collectively referred to as "Third Party Claims") (including but not limited to Third Party Claims arising out of loss of life, injury to persons, property, or business, or damage to natural resources) in connection with or arising out of any spills or discharges of Hazardous Materials in violation of applicable law, to the extent caused by the activities of Tenant or its contractors, or any of them, that occur during the Term of this
Lease, and (ii) from all claims, demands, judgments, damages, actions,, causes of action, injuries, administrative orders, consent agreements and orders, liabilities, penalties, costs, and expenses of any kind whatsoever, including but not limited to claims arising out of Tenant's failure to provide all information, make all submissions, and take all steps required by any authority under any Hazardous Materials laws or any other environmental law during the Term of this Lease. Notwithstanding the expiration or termination of this Lease, Tenant's obligations and liabilities under this Section shall continue so long as Landlord continues to own the Property or any portion thereof or otherwise remains responsible for any Hazardous Materials on the Property. Provided, however, that nothing contained in this provision is intended to or shall have the effect of relieving any party of liability under any applicable statutory or common law.
2.27 Recordation. Promptly upon the due execution of this Lease, the City shall cause this Lease to be recorded in the office of the recorder of San Diego County.
2.28 Quiet Eniovment. Absent an uncured default by Tenant, Landlord agrees not to disturb the possession, interest or quiet enjoyment of Tenant-in the Property for any reason.
2.29 General Provisions
(a) Waivers. The waiver by either party of any term,
covenant, or condition herein contained shall not be a waiver of such term, covenant, or condition on any subsequent breach.
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-_
(b) Notices. All notices and demands which may or are to be required or permitted to be given by either party to the other hereunder shall be in writing. Except as provided in Section 2.23 (e), all notices and demands shall be sent by United States Mail, postage prepaid, to the address for each party set forth in Article 1 of this agreement. All notices shall be deemed to be served upon personal delivery or two (2) days after mailing in the manner required by this Section.
(cl Time is of the Essence. Time is of the essence of this Lease and each and all of its provisions in which performance is a factor.
(d) Bindins on Successors and Assiqns. The covenants and conditions herein contained, subject to the provisions as to assignment, apply to and bind the heirs, successors, executors, administrators, and assigns of the parties hereto.
k) Force Maieure. In addition to specific provisions of this Lease, performance by either party hereunder shall not be deemed to be in default where delays or defaults are due to war, insurrection, floods, earthquakes, fires, casualties, Acts of God, epidemics, quarantine restrictions, governmental restrictions or priority, unusually severe weather, inability to secure necessary labor, materials or tools, acts of the other party, acts or failure to act of any other public or governmental agency or entity or any other causes beyond the control.or without the fault of the party claiming an extension of time to perform. An extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of knowledge of the commencement of the cause.
(f) Severability. Any provision of this Lease which shall prove to be invalid, void, or illegal shall in no way affect, impair, or invalidate any other provision hereof and such other provisions shall remain in full force and effect.
(9) No Exclusive Remedies. No remedy or election hereunder &all be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity.
(h) Laws of California. This Lease shall be governed by the laws of the State of California. Proper venue for any action shall be in San Diego, California.
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(i) No Partnership. Nothing contained in this Lease shall be deemed or construed as creating a partnership, joint venture, or any other relationship between the parties hereto other than Landlord and Tenant according to the provisions contained herein, or cause Landlord to be responsible in any way for the debts or obligations of Tenant, or any other party.
Cj) Final Asreement. This Lease, including any document or instrument incorporated therein or herein by reference, contains a complete and final expression of the agreement between Landlord and Tenant, and there are no promises, representations, agreements, warranties, or inducements either express or implied other than as are set forth in this Lease. Any and all previous discussions or agreements between Landlord and Tenant with respect to the premises, whether oral or written, are superseded by this Lease.
(k) Lansuase of Lease. When the context so requires when used in this Lease, the masculine gender shall be deemed to include the feminine and neuter gender and the neuter gender shall be deemed to include the masculine and feminine gender. When the context so requires when used in this Lease, the singular shall be deemed to include the plural. The paragraph and section headings have been used for convenience only, and shall not be used in the interpretation hereof. The term "includingtl shall mean "including but not limited to."
(1) Waiver. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being lawfully evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of the Property by reason of the violation by Tenant of any of the covenants and conditions of this Lease or otherwise.
(ml Recfuirement of a Writinq. No amendment, change, or addition to, or waiver of termination of, this Lease or any part hereof shall be valid unless in writing and signed by both Landlord and Tenant.
(n) No Third Partv Beneficiaries. The parties acknowledge and agree that the provisions of this Lease are for the sole benefit of Landlord and Tenant, and not for the benefit, directly or indirectly, of any other person or entity, except as otherwise expressly provided herein.
(0) Authoritv of Parties. The person executing this Lease on behalf of each Party has full authority to do so and to bind such Party to perform pursuant to the terms and conditions of this Lease.
(P) Incornoration bv Reference. Each of the exhibits attached hereto is incorporated herein by this reference.
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(9) Interoretation. This Lease has been negotiated at
arm's length.and between persons sophisticated and knowledgeable in the matters dealt with in this Lease. In addition, each party has
been given the opportunity to consult with experienced and
knowledgeable legal counsel. Accordingly, any rule of law
(including Civil Code section 1654) or legal decision that would require interpretation of any ambiguities in this Lease against the party that has drafted it is not applicable and is waived. The
provisions of this Lease shall be interpreted in a reasonable manner to effect the purpose and intent of the parties to this Lease.
(r) Counteroarts. This Lease may be executed by each
party on a separate signature page, and when the executed signature
pages are combined, shall constitute one single instrument.
In witness whereof, the parties have executed this Lease as of the date first set forth above.
CARLSBAD UNIFIED SCHOOL DISTRICT
By: +e .d Steve Cade, President
Attest:
By: & fi dw Clerk of the Board of Trustees
Attest:
By:
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9-21-99 -24-
, CALIFORNIA ALL--POSE ACKNOWLEDGMENT -
State of California
County of
On
personally appeared , Name(s) of Signer(s)
B personally known to me
Cl proved to me on the basis of satisfactory
evidence
to be the persod whose nameHis/-
subscribed to the within instrument and
acknowledged to me that heMWhey executed
the same in his- authorized
capacity ’
2
and that by hi&e&t+?+
signature on the instrument the person#$ or
the entity upon behalf of which the personw
acted, executed the instrument.
Place Notary Seal Above
OPTIONAL
Though the information below is not required by law, it may prove valuabte to persons mlyiing on the document
and could prevent fraudulent removal and reattachment of this form to another document.
Description of Attach
Title or
Signer(s) Other Than Naqed Above:
Capacity(ies) Claimed by Signer
Signer’s Name:
Cl Individual
0 Corporate Officer - Tile(s):
0 Partner - Cl Limited Cl General
Cl Attorney in Fact
0 Trustee
Cl Guardian or Conservator
Cl Other:
Signer Is Representing:
0 1997 National Notary Associatim -9350 De Soto Ave.. P.O. Box 2402 * Chahvcrlh, CA 91313-2402 Prod. No. 5907 Reader: Call Toll-Free 1-900-876-9.327
CALIFORNIA ALL-PURPOSE
personally appeared
@%J ersonally known to me
q proved to me on the basis of satisfactory
evidence
to be the person &whose nameH im
subscribed to the within instrument and
acknowledged to me that &e+she#tey executed
the same in bi&er/tkett authorized
capacity&@ and that by b&her/&&
signature@& the instrument the persont or
the entity upon behalf of which the personr
acted, executed the instrument.
Place Notary Seal Above
OPTIONAL
Though the information below is not required by law, it may prove valuable to persons retying on the document
and could prevent fraudulent removal and reattachment of this form to another document.
Signer(s) Other Than Nam_ed Above:
Capacity(ies) Claimed by Signer
Signer’s Name:
0 Individual
q Corporate Officer - Title(s):
•i Partner - 0 Limited El General
Cl Attorney in Fact
q Trustee
Cl Guardian or Conservator
Cl Other:
Signer Is Representing:
0 1997 National Notary Assoclah .9350 De Soto Ave., PO. Sax 2492. Chatsworth. CA 913132402 Reorder Call Toll-Free 1-800-8766827
.
STATE OF CALIFORNIA )
) ss. COUNTY OF SAN DIEGO )
eneel to be
executed the
his/k&&-&r signature entity upon instrument. ecuted the
WITNESS my hand and official seal.
Signature
JUDITH G. ClJNNlfF f comminionY12w17 rn
I sanDleaoccuflw t
Exhibit "A"
LEGAL DESCRIPTION
[To be inserted behind this page prior to Recording]
.
Exhibit clBft
SITE MAP
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di ty
October 12, 1999
Debbie Dunn
Escrow Officer
First American Title
11939 Ranch0 Bernard0 Road, Ste. 203
San Diego, CA 92 128
RE: Escrow No. 499-2335DD
Dear Ms. Dunn:
Enclosed are the following documents concerning the Sale of Real Property and Ground Lease
Agreement for the Pine School Site from the October 5,1999 City Council Meeting:
1. Two Agreements for Sale of Real Property from the Carlsbad Unified School District to the
City of Carlsbad.
2. Two Ground Leases by and between the City of Carlsbad and the Carlsbad Unified School
District.
Please let me know if you have any questions, my phone is (‘760) 434-2800, ext. 5107. Thank
you for your assistance with this matter.
Sincerely,
h l - M. WOOD
Deputy City Clerk
Enclosures (4)
c: Keith Beverly, Parks and Recreation
1200 Carlsbad Village Drive * Carlsbad, CA 92008-l 989 - (760) 434-2808 a!9