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HomeMy WebLinkAboutReso 60-21.Rock.Harbor.Lease. Amendment 1RESOLUTION NO. 60-21 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MORRO BAY, CALIFORNIA APPROVING AMENDMENT 1 OF THE ROCK HARBOR MARKETING LEASE TO EXTEND LEASE TERM FOR 3 YEARS FOR LEASE SPACE B AT 781 MARKET STREET BETWEEN THE CITY OF MORRO BAY AND ROCK HARBOR MARKETING LLC THE CITY COUNCIL City of Morro Bay, California WHEREAS, the City of Morro Bay (City) is the lessor of the property at 781 Market Street, in the City of Morro; and WHEREAS, Rock Harbor Marketing, LLC (Lessee) is proposing to lease Space B of the 781 Market Street Building; and WHEREAS, City and Lessee have agreed to an amendment of the lease agreement to increase the term by 3 years, for a portion of the building located at 781 Market Street identified as Space B. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Morro Bay, California, as follows: 1. The attached new Lease Amendment 1 for Space B in the 781 Market Street Building Lease is hereby approved. 2. The Mayor is hereby authorized to execute said Lease Amendment 1. PASSED AND ADOPTED by the City Council of the City of Morro Bay at a regular meeting thereof held on the 14th day of September 2021 on the following vote: AYES Headding, Addis, Barton, Heller NOES' None ABSENT: None ATTEST: any A) ioMSr?NAL, Dana Swanson, City Clerk AMENDMENT #1 TO AND ASSIGNMENT AND ASSUMPTION OF THE LEASE AGREEMENT FOR PORTION OF 783 MARKET AVENUE This Amendment (this "Amendment #1 ") is made and entered into as of the 15th day of September, 2021 by and among the City of Morro Bay, a municipal corporation of the State of California, hereinafter called "City," Travis Ford, dba Rock Harbor Marketing, a sole proprietorship, hereinafter called "Ford" and Rock Harbor Marketing, LLC, a California limited liability corporation, hereinafter called "Rock Harbor." (Collectively, City, Ford and Rock Harbor are sometimes referred to herein as the "Parties.") WHEREAS, City and Ford are parties to the certain lease, effective as of November 11, 2020 (the "Lease") for a portion of City -owned property at 783 Market Avenue, as further defined in the Lease (the "Premises"); WHEREAS, the Lease is due to terminate, by its own terms, on November 10, 2021; WHEREAS, Ford desires to assign its rights under the Lease to Rock Harbor and Rock Harbor desires to assume all of Ford's rights and obligations pursuant to the Lease; and WHEREAS, City and Rock Harbor desire to extend the term of the Lease with certain modifications. NOW THEREFORE, City, Ford and Rock Harbor agree as follows: 1. Unless expressly stated herein, words used in this Amendment #1 shall have the same meaning as stated in the Lease, except to the extent the context requires otherwise. 2. The foregoing recitals are incorporated into this Amendment #1 as true and correct. 3. Rock Harbor acknowledges any assignment of the Lease is subject to prior approval by the City's City Council and is also subject to prior execution of this Amendment #1 by Rock Harbor and Ford. 4. On the Effective Date (defined below), Rock Harbor agrees (i) to comply with all the terms and conditions of the Lease, as amended by this Amendment #1, (11) to assume all liabilities required under the Lease, as amended by this Amendment #1, (iii) to defend, indemnify and hold harmless City and its officers, employees and representatives from and against, any and all claims, lawsuits, costs and expenses, including reasonable attorney's fees and court costs arising from, or in any way related to the Lease, as amended by this Amendment #1, in 01181.0001/737964.1 JPANNONE_ALWY 1 of 3 accordance with the terms set forth in the Lease, as amended by this Amendment #1, and (iv) to maintain liability insurance in the manner, form and amount required by the Lease and any future amendments thereto, with City, its officers, employees and representatives, included as an additional insureds without offset against the City's insurance. 5. Ford hereby assigns to Rock Harbor all rights, title and interest Ford has in the Lease, effective on the Effective Date. 6. Ford confirms to City Ford has no actual knowledge or reasonable cause to believe any release of hazardous substance has come to be located on/or beneath the real property during the term of Ford's occupation of the Premises that has not been reported pursuant to Health & Safety Code Section 253597. 7 Upon the Effective Date, Ford is released from any and all obligations created pursuant only to the Lease and this Amendment #1. 8. The Parties agree Ford is no longer a necessary party to any future amendment to the Lease after the Effective Date. 9. City and Rock Harbor agree to amend the Lease as follows: a. The Term of the Lease shall be extended through September 14, 2024, unless otherwise terminated as permitted by the Lease. b. Section 2.3 of the Lease is amended to add the following: City shall have the right to terminate this Lease within the Term upon providing Rock Harbor at least sixty -days' written notice City has entered into a purchase and sale agreement with any party for redevelopment of the Premises. c. As of October 1, 2021, the monthly Rent is increased to One Thousand One Hundred Forty-three Dollars ($1,143.00). As of September 15, 2022, and September 15, 2023, the Rent shall be increased in an amount equal to the increase in the then applicable Consumer Price Index for the Los Angeles area (Los Angeles -Long Beach -Anaheim) (CPI) for the twelve-month period immediately preceding each of those dates. d. Section 27 of the Lease is amended so the Rent shall increase in an amount equal to the then annual applicable CPI for the twelve-month period immediately preceding each September 15th if a month -to -month holdover remains in effect. 10. Except as expressly stated herein, all provisions of the Lease shall remain in full force and effect. 01181.0001/737964.1 JPANNONE_ALWY 2 of 3 11. The Effective Date of this Amendment #1 is the date first written above, as long as it has been signed by the Parties. 01181,0001/737964.1 JPANNONE_ALWY 3 of 3 IN WITNESS WHEREOF, the Parties have executed this Amendment #1 as of the date written above. CITY OF MORRO BAY TRAVIS FORD By: John Headding, Mayor APPROVED AS TO FORM: ROCK HARBOR MARKETING, LLC, a California limited liability company By Chris F. Neumeyer, City Attorney Trais Ford, Managing Member ATTEST: Dana Swanson, City Clerk 01181.0001/737964.1 JPANNONE_ALWY 4 of 3