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HomeMy WebLinkAbout11/1/2006 - STAFF REPORTS - 2.H.CITY COUNCIL STAFF REPORT DATE: November 1, 2006 SUBJECT: NON-EXCLUSIVE OPERATING & GREATER LOS ANGELES AREA, OPERATE A USO SERVICE INTERNATIONAL AIRPORT FROM: David H. Ready, City Manager BY: Department of Aviation SUMMARY CONSENT CALENDAR LEASE AGREEMENT WITH USO — INC. FOR TERMINAL SPACE TO CLUB AT PALM SPRINGS Airport staff is requesting approval for a non-exclusive operating and lease agreement with USO — Greater Los Angeles Area, Inc. for terminal space to operate a USO Service Club within Palm Springs International Airport (PSP) terminal. RECOMMENDATION: Approve Minute Order No. , approving Non -Exclusive Operating & Lease Agreement with USO — Greater Los Angeles Area, Inc. for Terminal Space to operate a USO Service Club effective November 1, 2006 and valid until October 31, 2011. 2. Authorized the City Manager to execute all necessary documents contingent upon Federal Aviation Administration (FAA) approval. STAFF ANALYSIS: PSP is the nearest airport to the Marine Base in Twentynine Palms. A steady stream of military personnel pass through the airport, During the holiday season the numbers swell dramatically to hundreds per day. Many times military personnel must spend the night in the terminal waiting for early departures the next day. The volunteer Airport Navigators have generously converted their small break room into a military lounge with three comfortable chairs. The Navigators donate all the quarters Item No. n . 1 1 . City Council Staff Report (November 1, 2006 -- Page 2) (USO Agreement) they collect from returning airport Kary Karts to purchasing prepackaged snacks for the military. Year round the Spa Hotel kindly provides complimentary rooms if available. During the last few holiday Seasons, the Transportation Security Administration (TSA) has shared their break room including renting cots, with the huge influx of military travelers. Last holiday season the community at large donated a vast array of much appreciated contributions. This year TSA moved to a new break room facility that is not in the public area of the terminal. The 'old" TSA break room is now vacant. This area consists of 975 SF at the north end of the terminal baggage claim area. The agreement would lease this space to the United Service Organization (USO) to operate a USO Airport Service Club facility at the rental rate of $1.00 per year. This agreement is contingent upon FAA approval. Currently the USO — Greater Los Angeles area has responsibility for two USO Service Club Airport Facilities. These include the Bob Hope Hollywood USO at Los Angeles International Airport (LAX). This month a new USO airport facility will open at Ontario International Airport (ONT). Both facilities pay $1 per year for the terminal space rental. USO Airport facilities are open to active, retired and families of military personnel at no charge. It is hoped the PSP — USO facility will include a quiet rest area, computer/internet area, TV/Video/DVD area, a snack area and possibly a small play area for children. The LAX and ONT - USO airport facilities have a paid facility director and a staff of volunteers. USO Airport Service Clubs operate entirely on donations. Due to USO budget constraints the PSP - USO facility would be staffed entirely by volunteers including the USO facility director. The person selected by the USO to direct the facility would be a key factor in the success of the startup of operations. This individual would contract with the USO and receive training, guidelines and backup from the USO. The Job Flyer for the Volunteer USO Facility Director is attached. Airport Administration and the City of Palm Springs would not be involved in the operation of the USO Airport Service Club facility except for the landlord/tenant relationship based on the Non -Exclusive Operating and Lease Agreement for the terminal space. The Airport presented this idea to the Airport Commission in September and received a positive initial response regarding donations. USO Airport Service Clubs solicit donations from the local community — besides money, donations include furniture, fixtures, equipment, and much more. The USO — Greater Los Angeles Area, Inc. is a non-profit 501 (C) (3) corporation and once the agreement has received all the necessary approvals the USO will begin accepting donations for the PSP — USO Airport facility. A local foundation has tentatively committed to a $20,000 donation to get the ball rolling as soon as all approvals are received. City Council Staff Report (November 1, 2006 -- Page 3) (USO Agreement) At its regularly scheduled meeting on November 1, 2006, the Airport Commission recommended City Council approve the Non-exclusive Operating and Lease Agreement for Terminal Space to operate a USO Service Club at Palm Springs International Airport effective November 1, 2006 and valid until October 31, 2011. FISCAL IMPACT: (Finance Director Review: The proposed space would generate $25,145.25 per annum if leased to non signatory airline tenant based on Comprehensive Fee Schedule rate of $25.79 per SF per annum (975 SF). The space is currently vacant and not generating revenue at this time nor does it seem likely to generate revenue in the foreseeable future. David H. Ready, ity lw Attachments: Minute Order Lease Agreement Volunteer USO Facility Director Job Flyer Richard S. Walsh, A.A.E. Director of Aviation MINUTE ORDER NO. APPROVE MINUTE ORDER NO. APPROVING NON-EXCLUSIVE OPERATING AND LEASE AGREEMENT WITH USO — GREATER LOS ANGELES AREA, INC. FOR TERMINAL SPACE TO OPERATE A USO SERVICE CLUB EFFECTIVE NOVEMBER 1, 2006 AND VALID UNTIL OCTOBER 31, 2011. I, James Thompson, City Clerk of the City of Palm Springs, hereby certify that this Minute Order Approving Non -Exclusive Operating and Lease Agreement with USO — Greater Los Angeles Area, Inc. for Terminal Space to operate a USO Service Club effective November 1, 2006 and valid until October 31, 2011 adopted by the City Council of the City of Palm Springs, California, in a meeting thereof held on the 1 st day of November, 2006 James Thompson, City Clerk USO — GREATER LOS ANGELES AREA, INC. NON-EXCLUSIVE OPERATING AND LEASE AGREEMENT FOR TERMINAL SPACE AT PALM SPRINGS INTERNATIONAL AIRPORT THIS LEASE ("Lease") is made and entered into this 1st day of November 2006, by and between the CITY OF PALM SPRINGS, a charter city and California municipal corporation ("City"), and USO — Greater Los Angeles Area, Inc. a California corporation ("Tenant"). City and Tenant may hereinafter be referred to individually as a "Party" and collectively as "Parties". RECITALS A. Tenant desires to lease and operate a USO Service Club at Palm Springs International Airport ("Airport"). B. City believes that the flow of military personnel, retired military personnel and military dependants within the City's airport terminal would benefit from the convenience and accessibility of a USO Service Club at Palm Springs International Airport. NOW THEREFORE, City and Tenant mutually agree as follows: AGREEMENT Section 1. LEASE SUMMARY Certain fundamental Lease provisions are presented in this Section and represent the agreement of the parties hereto, subject to further definition and elaboration in the respective referenced Sections and elsewhere in this Lease. In the event of any conflict between any fundamental Lease provision and the balance of this Lease, the latter shall control. 1.1 Demised Premises. The "Demised Premises" consists of approximately 975 square fee of exclusive use space located in the airport terminal and more particularly described in Exhibit "A" attached hereto. 1.2 Lease Term. The term of this Lease shall commence on November 1, 2006 and shall terminate on October 31, 2011, subject however to earlier termination by either party with ninety (90) days advance written notice, or as otherwise provided in this Lease. 1.3 Lease Rental Pavments. The rent shall be in the amount of one dollar ($1.00) per annum. 14 Use of Demised Premises. Demised Premises may be utilized to operate a USO Service Club under the Ordinances of the City applicable to the Demised Premises and the Airport Rules and Regulations. 1.5 Days / Hours of Operation: Seven days per week / Various hours as determined by Tenant needs up to 24 hours per day. USO — Greater Los Angeles Area Page 1 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport Section 2, TERM 2.1 Term. The initial term of this Lease shall commence on the date specified in Section 1.2 Commencement Date and shall continue for the period specified therein. Lease subject to earlier termination by either party with ninety (90) days advance written notice, or as otherwise provided in this Lease. If Lessee remains in possession of all or any part of the Demised Premises after the expiration of the term hereof, with or without the express or implied consent of City, such tenancy shall be from month to month only, and not a renewal hereof or an extension for any further term, and in such case, rent and other monetary sums due hereunder shall be payable in the amount and at the time specified in the Lease and such month to month tenancy shall be subject to every other provision, covenant and agreement contained herein. Acceptance by City of rent after such expiration or earlier termination shall not constitute a holdover hereunder or result in a renewal. The foregoing provisions of the subsection are in addition to and do not affect the right of re-entry or any right of City hereunder or as otherwise provided by law, and in no way shall affect any right which City may otherwise have to recover damages from Tenant for loss or liability incurred by City resulting from such failure by Tenant to surrender the Demised Premises. Nothing contained in this Sub -section shall be construed as consent by City to any holding over by Tenant, and City expressly reserves the right to require Tenant to surrender possession of the Demised Premises to City as provided in this Leas upon the expiration or other termination of the Lease. Section 3. RENTAL. 3.1 Yearly Rental. Tenant shall pay to City, during the term of this Lease from and after the Commencement Date as yearly rental for the Demised Premises the sum specified in Section 1.4 hereof, which sum shall be paid in advance on the first day of each calendar year. 32 Real Prooerty Taxes. In addition to all rentals herein reserved, Tenant shall pay, at the election of City, either directly to the taxing authority or to City, any annual real estate taxes and assessments levied upon the Demised Premises (including any possessory interest taxes), as well as taxes of every kind and nature levied and assessed in lieu of, in substitution for, or in addition to, existing real property taxes, if any. (Tenant specifically acknowledges that the interest granted under this Lease may be subject to possessory interest taxes.) Such amount shall be paid on the date that is twenty (20) days prior to the delinquent date or, if City receives the tax bill, ten (10) days after receipt of a copy of the tax bill from City, whichever is later. Even though the term of this Lease has expired and Tenant has vacated the Demised Premises, when the final determination is made of Tenant's share of such taxes and assessments, Tenant shall immediately pay to City the amount of any additional sum owed. 3.3 Personal Prooertv Taxes. During the term hereof Tenant shall pay prior to delinquency all taxes (if any) assessed against and levied upon fixtures, furnishings, equipment and all other personal property of Tenant contained in the Demised Premises, and when possible tenant shall cause said fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the real property of City, 3.4 Utilities. All cost for water, gas, heat or electricity used in connection with the heating or air conditioning furnished to the Demised Premises shall be paid by City. Tenant shall pay USO -- Greater Los Angeles Area Page 2 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport before delinquency all charges for telephone service, trash removal and all other services and utilities used in, upon, or about the Demised Premises by Tenant- 3-5 Late Pavment. Tenant hereby acknowledges that late payment by Tenant to City of rental or other sums due hereunder will cause City to incur costs not contemplated by this Lease, the exact amount of which Is extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges. Accordingly, any payment of any sum to be paid by Tenant not paid within five (5) days of its due date shall be subject to a five percent (5%) late charge. City and Tenant agree that this late charge represents a reasonable estimate of such costs and expenses and is fair compensation to City for its loss suffered by such late payment by Tenant. 3.6 Interest. Any sum to be paid pursuant to the terms of this Lease not paid when due shall bear interest from and after the due date until paid at a rate equal to three percent (3%) over the reference rate being charged by Bank of America, N.A. from time to time during such period so long as the rate does not exceed the maximum non -usurious rate permitted by law in which case interest shall be at the maximum non -usurious rate allowed by law at the time the sum became due. Section 4. USE OF THE PREMISES. 4.1 Permitted Uses. Demised Premises may be utilized to operate a USO Service Club under the Ordinances of the City applicable to the Demised Premises and the Airport Rules and Regulations. 41 Operational Standards. The operations of the Tenant, its employees, invitees and those doing business with it shall be conducted in an orderly and proper manner and so not to annoy, disturb, or be offensive to others at the Airport. No solicitation of the public outside the Demised Premises is allowed. Tenant shall provide and its employees shall wear or carry badges or other suitable means of identification. The badges or means of identification shall be subject to the written approval of the Director of Aviation. The City shall have the right to object to Tenant regarding the demeanor, conduct or appearance of Tenant's employees, invitees and those doing business with it, whereupon Tenant will take steps necessary to remove the cause of objection. Tenant shall select and appoint a manager for its operation within the Demised Premises. Said person must be a qualified and experienced manager, vested with full power and authority, and shall so inform City in respect to the method, manner and conduct of the operation at the Airport. The manager shall be available during regular business hours and at all times during his/her absence, a subordinate shall be in charge and available at the Demised Premises. Tenant shall be responsible for the conduct, demeanor and appearance of its officers, agents, employees and representatives. Customer service personnel and attendants shall be trained by Tenant to render a high degree of courteous and efficient service, and it shall be the responsibility of the Tenant to maintain close supervision over said personnel to assure the rendering of a high standard of service to the public and the patrons of the Counter concession. Upon objection from the Director of Aviation concerning the conduct, demeanor or appearance of such persons, Operator shall take all steps necessary to remove the cause of the objection. USO -- Greater Los Angeles Area Page 3 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport Tenant, its agents and employees shall conduct and maintain a friendly and cooperative relationship with other Tenants operating in the Airport. Tenant shall not engage in open, notorious and public disputes, disagreements or conflicts tending to deteriorate the quality of service or be incompatible to the best interest of the public at the Airport. The City shall have the right to resolve all such disputes, disagreements, or conflicts and its determination shall be final. 4.3 Comnliance with Laws. Tenant shall, at its sole cost and expense, comply with all of the requirements of all municipal, state, and federal authorities now in force or which may hereafter be in force pertaining to the use of the Demised Premises, and shall faithfully observe in said use all municipal ordinances, including, but not limited to, the General Plan and zoning ordinances, state and federal statutes, or other governmental regulations now in force or which shall hereinafter be in force. Tenant shall not engage in any activity on or about the Demised Premises that violates any Environmental Law, and shall promptly, at Tenant's sole cost and expense, take all investigatory and/or remedial action required or ordered by any governmental agency or Environmental Law for clean-up and removal of any contamination involving any Hazardous Material created or caused directly or indirectly by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute, ordinance or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Demised Premises, including, without limitation, (I) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Sections 9601 at seq.; (ii) the Resource Conservation and Recovery Act of 1976. ("RCRA"), 42 U.S.C. Sections 6901 et M.; (iii) California Health and Safety Code Sections 25 100 et seq.; (iv) the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq.; (v) California Health and Safety Code Section 26359.7; (vi) California Health and Safety Code Section 25915; (vii) the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 at Seq.; (viii) California Water Code Section 1300 et seq.; and (ix) California Civil Code Section 3479 at seq., as such laws are amended and the regulations and administrative codes applicable thereto. The term "Hazardous Material" includes, without limitation, any material or substance which is (i) defined or listed as a "hazardous waste", "extremely hazardous waste", "restrictive hazardous waste" or "hazardous substance" or considered a waste, condition of pollution or nuisance under the Environmental Laws; (ii) petroleum or a petroleum product or fraction thereof; (iii) asbestos; and/or (iv) substances known by the State of California to cause cancer and/or reproductive toxicity. It is the intent of the parties hereto to construe the terms "Hazardous Materials" and "Environmental Laws" in their broadest sense. Tenant shall provide all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq. Tenant shall provide prompt written notice to City of the existence of Hazardous Substances on the premises and all notices of violation of the Environmental Laws received by Tenant. Nothing herein contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308 of the Federal Aviation Act of 1958, as amended. 4.4 Public Facilities. Inaress. Eoress and Quiet Eniovment. City agrees that Tenant, upon payment of the rental hereunder and performing the covenants of the Lease, may quietly have, hold and enjoy the Demised Premises during the term of the Lease, and that Tenant shall have the non-exclusive right to use, in common with others, the public facilities at the USO — Greater Los Angeles Area Page 4 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport Airport and Tenant shall have a reasonable right of ingress to and egress from the Demised Premises and the public facilities for its employees, visitors and customers. City shall provide parking at no cost for two (2) Tenant employee vehicles in the Airport Employee Parking Lot. 4.5 Rules and Reaulations. Tenant shall faithfully observe and comply with the any rules and regulations that City shall from time to time promulgate and/or modify_ Any amendment or modification of the Airport Rules and Regulations shall be binding upon the Tenant upon delivery of a copy of such amendment or modification to Tenant. City shall not be responsible to Tenant for the nonperformance of any said rules and regulations by any other tenants or occupants. The Airport Rules and Regulations shall apply and be enforced as to all tenants in the Demised Premises on a uniform basis. Section 5. ALTERATIONS AND REPAIRS, 5.1 Improvements. Alterations and Fixtures. Tenant shall not make or suffer to be made, any alterations or improvements to the Demised Premises, or any part thereof, without the prior written consent of City, and any alterations or improvements to the Demised Premises, except movable furniture, and trade fixtures, shall become at once a part of the realty and shall at the expiration or earlier termination of this Lease belong to City free and clear of any liens or encumbrances. Tenant shall not in any event make any changes to the exterior of the Demised Premises, if any. Any such alterations or improvements shall be in conformance with the requirement of all municipal, state, federal, and other governmental authorities, including requirements pertaining to the health, welfare or safety of employees of the public and in conformance with reasonable rules and regulations of City. City may require that any such alterations or improvements be removed prior to the expiration of the term hereof. Any removal of alterations or improvements or furniture and trade fixture shall be at Tenant's expense and accomplished in a good and workmanlike manner. Any damage occasioned by such removal shall be repaired at Tenant's expense so that the Demised Premises can surrender in a good, clean and sanitary condition as required by Section. 52 hereof. All fixtures, improvements and appurtenances installed by Tenant shall conform with the requirements of all municipal, state, federal, and governmental authorities including requirements pertaining to the health, welfare, or safety of employees or the public. 5.2 Maintenance and Repair. Tenant shall, subject to City's obligations hereinafter provided, at all times during the term hereof, and at Tenant's sole cost and expense, keep, maintain and repair the Demised Premises and other improvements within the Demised Premises in good and sanitary order, condition, and repair (except as hereinafter provided).. Tenant shall also at its sole cost and expense be responsible for any alterations or improvements to the Demised Premises necessitated as a result of the requirement of any municipal, state or federal authority. Tenant hereby waives all right to make repairs at the expense of the State of California to make said repairs. By entering into the Demised Premises, Tenant shall be deemed to have accepted the Demised Premises as being in good and sanitary order, condition and repair, and Tenant agrees on the last day of said term or sooner termination of this Lease to surrender the Demised Premises with appurtenances, in the same condition as when received and in a good, clean and sanitary condition, reasonable use and wear thereof and damage by fire, act of God or by the elements excepted. USO — Greater Los Angeles Area Page 5 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport 5.3 Free From Liens. Tenant shall keep the Demised Premises free from any liens arising out of any work performed, material furnished, or obligation incurred by Tenant or alleged to have been incurred by Tenant. 5.4 Citv's Reserved Riahts. (a) Airoort Develooment and Safety. City reserves the right to further develop or improve the aircraft operating area of the Airport as it sees fit, and City reserves the right to take any action it considers necessary to protect the aerial approaches of the Airport against obstruction, together with the right to prevent Tenant from erecting or permitting to be erected any building or other structure of the Demised premises which, in the opinion of City, would limit the usefulness of the Airport or constitute a hazard to aircraft. (b) Riaht to Relocate Demised Premises. City reserves the right to relocate all of the Demised Premises within the Terminal Building if required to ensure the operational effectiveness of the Terminal Building and concourses. Said relocation shall be to an area of comparable size and quality as is reasonably practicable. Notwithstanding the foregoing, in the event the Substituted Premises is unsatisfactory to Tenant in its reasonable discretion, Tenant shall give Landlord written notice thereof ("Tenant's Objection Notice") within ten (10) days following Tenant's receipt of notice of such relocation, following which Tenant and Landlord shall work in good faith to resolve Tenant's objections to the Substituted Premises or to locate alternate Substituted Premises reasonably acceptable to Tenant. In the event that Landlord and Tenant are unable to reach agreement within thirty (30) days following Landlord's receipt of Tenant's Objection Notice, Tenant may terminate this Lease by giving written notice thereof to City, which termination shall be effective the date relocation is required by the City. In the event of termination by Tenant under this paragraph, the Security Deposit shall be returned to Tenant upon payment by Tenant to City of all amounts otherwise due under this Lease through the date of termination. Tenant and City shall thereafter have no rights or obligations under this Lease. (c) Termination By City For Airport Related Puroose. In the event City should require the Demised Premises, or any portion thereof, for any Airport related purpose whatsoever, Tenant agrees that City may terminate this Lease by giving Tenant one hundred twenty (120) days written notice. If this Lease is terminated under the provisions of this Section 5.4(c), City shall reimburse Tenant for Tenant's actual construction cost of any new improvements installed subsequent to the execution of this Lease and pursuant to the provisions of Section 5.1 of this Lease, less depreciation at the rate of 20% per year from date of this Lease, regardless of when such improvements are installed. The reimbursement provided above shall be Tenant's sole and exclusive remedy and form Of compensation, costs or damages, including Relocation Assistance benefits (Sec. 7260 et sea. of the California Government Code), due to termination, re-entry or acquisition by city- (d) Lease to United States. During the time of war or national emergency, City shall have the right to lease the landing area or any part thereof to the United States Government for military or naval use, and, if such lease is executed, the provisions of this Lease insofar as they are inconsistent with the provisions of the lease to the Government shall be suspended and, in that event, a just and proportionate part of the rent hereunder shall be abated, and the period of such closure shall be added to the term of this Lease so as to USO — Greater Los Angeles Area Page 6 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport extend and postpone the expiration thereof unless the Tenant otherwise elects to terminate this Lease. Section 6. INSURANCE AND INDEMNIFICATION. 6.1 Insurance. Prior to its ability to access the Demised Premises, Tenant will provide City with proof of insurance, at Tenant's sole cost and expense, to remain in full force and effect during the entire term of this Lease. The following policies of insurance shall be maintained, 6.1.1 Workers' Compensation Insurance. Workers' Compensation Insurance in an amount required by the laws of California and Employers Liability Insurance in an amount not less that ONE MILLION DOLLARS ($1,000,000) combined single limit for all damages arising from each accident or occupational disease. 6.1.2 Commercial General Liabilitv. Commercial General Liability Insurance written on a per -occurrence and not a claims -made basis with a combined single limit of at least ONE MILLION DOLLARS ($1,000,000) bodily injury and property damage including coverages for contractual liability, personal injury, independent contractors, broad form property damage, products and completed operations. 6.1.3 Automobile Liability Insurance. A policy of comprehensive automobile liability insurance written on a per -occurrence basis in an amount not less than ONE MILLION DOLLARS ($1,000,000) combined single limit covering all owned, non -owned, leased, and hired vehicles used in connection with operations occurring on the Demised Premises. 6.1.4 Other Insurance. Such other policies of insurance including, but not limited to, casualty insurance, business interruption insurance, and fidelity insurance, as may be required by the nature of operations. 6.1.5 General Provisions. • The above insurance shall be primary and no other insurance maintained by the City will be called upon to contribute to a loss. All polices except Workers Compensation shall have the City named as an additional insured. Workers Compensation insurance of the Tenant shall contain a waiver -of -subrogation clause in favor of the City, its officers, directors, officials, agents, employees, volunteers, and representatives. All policies of insurance required to be obtained by Tenant hereunder shall be issued by insurance companies authorized to do business in California and must be rated no less than A-, VII or better in Best's Insurance Guide. Prior to engaging in any operations hereunder, Tenant shall deliver to City certificate(s) of insurance and original endorsements evidencing the coverages specified above. Such policies shall not be cancelled or materially altered to the detriment of City or Tenant without the insurer providing City with thirty (30) days' written notice. 62 Indemnification by Tenant. Tenant shall indemnify, defend (with counsel designated by City), protect and hold harmless City, City's Parties and the Releasing Parties from and against any and all claims, demands, judgments, actions, damages, losses, penalties, liabilities, costs and expenses (including, without limitation, attorney's fees and court costs) arising at any time directly or indirectly from or in connection with (i) any default in the performance of any obligation by Tenant to be performed under the terms of this Lease, (ii) Tenant's use of the Demised Premises, or (iii) the conduct of Tenant's business or any activity, work or things done, permitted or suffered by Tenant in or about the Demised Premises, except to the extent caused by City's negligence or willful misconduct. The USO — Greater Los Angeles Area Page 7 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport obligations of Tenant under this Article 6 shall survive the expiration or earlier termination of this Lease. Tenant, as a material part of the consideration to City, hereby assumes all risk of damage to the Demised Premises, including, without limitation, injury to persons in, upon or about the Demised Premises during Tenant's use of the Demised Premises, except where such damage or injury is caused solely by the negligence or willful misconduct of the City or the City's Parties. Tenant hereby waives all claims with respect thereof against City. City shall not be liable for any injury to the Tenant, or injury to or death of any of Tenant's Parties, or injury to or death of any other person in or about the Demised Premises from any cause except to the extent caused by the negligence or willful misconduct of the City or the City's Parties. 6.3 Assumption of All Risks and Liabilities. Tenant assumes all risks and liabilities arising out of any and all use of the Demised Premises by Tenant or Tenant's Parties, except where such damage or injury is caused solely by the negligence or willful misconduct of the City or the City's Parties. Section 7, ABANDONMENT AND SURRENDER. 7.1 Abandonment. Tenant shall not vacate or abandon the Demised Premises at any time during the term of this Lease, and if Tenant shall abandon, vacate or surrender the Demised Premises or be dispossessed by process of law, or otherwise, any personal property belonging to Tenant and left on the Demised Premises shall be deemed to be abandoned, at the option of City, except such property as may be mortgaged to City. 7.2 Surrender of Lease. The voluntary or other surrender of this Lease by Tenant or a mutual cancellation thereof, shall not work a merger, and shall, at the option of City, terminate all provisions of existing lease. Tenant shall not assign or sublease. Section 8. DAMAGE AND DESTRUCTION OF DEMISED PREMISES. In the event of (a) partial or total destruction of the Demised Premises during the term of this Lease, which requires repairs to the Demised Premises, or (b) the Demised Premises being declared unsafe or unfit for occupancy by any authorized public authority for any reason, which declaration requires repairs to the Demised Premises, Tenant shall forthwith make said repairs, except where such damage or injury is caused solely by the negligence or willful misconduct of the City or the City's Parties. No such damage or destruction (including any destruction necessary in order to make repairs required by any declaration made by any public authority) shall in any way annul or void this lease. Tenant shall promptly clean and remove all debris resulting from said damage or destruction. Tenant shall take preliminary steps toward restoring the improvements with thirty (30) days of the casualty and such improvements shall be restored within a reasonable time thereafter. The Demised Premises shall be restored to the condition they existed immediately before said casualty. Section 9. ASSIGNMENT. Tenant shall not assign this Lease the Demised Premises, or any interest therein. Any assignment without the prior written consent of City shall be void, shall constitute a material breach of this Lease, and shall, at the option of City, terminate this Lease. Section 10. ENCUMBRANCE USO — Greater Los Angeles Area Page 8 of 17 Nora -Exclusive Operating & Lease Agreement Palm Springs International Airport 10.1 This Lease, or any right to or interest in, or any of the improvements on the Demised Premises, may be encumbered with the written approval of City. Any such approved encumbrance shall be subject to the covenants, conditions and restrictions set forth herein and to all rights of City. 10.2 Any encumbrance must be confined to the leasehold interest of Tenant and shall not affect in any way the City's interest in the land. The encumbrance shall provide that the proceeds from fire or extended coverage insurance shall be used for the repair or rebuilding of the leasehold improvements and not to repay any part of the outstanding mortgage. Tenant agrees to furnish, as requested, any financial statements or analyses pertinent to the encumbrance that City may deem necessary to justify the amount, purpose and terns of said encumbrance. 10.3 In the event of default by the Tenant of the terms of an approved encumbrance, the encumbrancer may exercise any rights provided in such approved encumbrance provided that, before any sale of the leasehold estate, whether by power of sale or foreclosure, the encumbrancer shall give to City notice of the same character as is required to be given to Tenant by such encumbrancer pursuant to the loan documents and/or the laws of the State of California and City shall be given an additional thirty (30) days in which to cure the default after the time for Tenant to cure has expired. 10.4 If any sale under the approved encumbrance occurs, whether by power of sale or foreclosure, and the purchaser at such sale is the encumbrancer, the encumbrancer may sell and assign this Lease without any further consent of City provided that the assignee shall agree in such assumption by the assignee, the encumbrancer shall be released from all future obligations of the Tenant under this Lease. If a sale under the approved encumbrance occurs, and the purchaser is a party other than the encumbrancer, said purchaser, as successor in interest to the Tenant shall be bound by all the terms and conditions of this Lease and the purchaser shall assume in writing the obligations of Tenant hereunder. 10.5 If notice of such sale shall be given and the defaults or any of them upon which such notice of sale is based shall then continue, City shall have the right to correct such defaults at any time prior to the date of sale or foreclosure, and to terminate such leasehold upon paying to the encumbrancer the balance of the encumbrance as hereinafter defined. 10.6 "Balance of encumbrance" shall mean the amount of principal remaining unpaid on a note secured by a trust deed or mortgage of an interest plus accrued and past due interest thereon and expenses incurred by the lender in connection with foreclosure including by not limited to, fire insurance premiums, title insurance expenses, recording fees, appraisal fees, credit reports and any tax reporting services and additional expenditures paid by the lender on additions, betterments and rehabilitations of improvements on the property encumbered pursuant to plans approved by City, which consent may not be unreasonably withheld, and other expenses necessary to place the improvements in marketable condition, such adjusted principal to be paid in case or, at the option of City, amortized over the tern and in accordance with the schedule set forth in said note, the interest rate on the unpaid balance thereto to be as set forth in said note. 10.7 City agrees to provide encumbrancer written notice of any default by Tenant under this Lease and an opportunity to cure at the time notice of such default is provided to Tenant and give encumbrancer thirty (30) days to cure a monetary default or forty-five (45) days to cure a non -monetary default; provide, however, that if such non -monetary default cannot USO — Greater Los Angeles Area Page 9 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport be cured within such period of forty-five (45) days, encumbrancer shall have a reasonable time to cure such default provided that encumbrancer commences to cure within said forty- five (45) days and diligently prosecutes the cure to completion. Such period shall include the time to complete a foreclosure action if encumbrancer needs to gain possession of the Demised Premises to cure said default by Tenant. Section 11. DEFAULT AND REMEDIES. 11.1 In the event Tenant fails to perform any obligations under this Lease and after the expiration of any cure period, City may terminate Tenant's right to possession of the demised Premises by any lawful means, in which case the Lease shall terminate. 112 Neither party shall be deemed to be in default in the performance of any obligation required to be performed by it hereunder unless and until it has failed to perform such obligation within thirty (30) days after written notice by the other party specifying in reasonable detail the nature and extent of any such failure; provided, however, that if the nature of the obligation is such that more than thirty (30) days are required for its performance, then the parry shall not be deemed to be in default if it shall commence such performance within such thirty (30) day period and thereafter diligently prosecutes the same to completion. Section 12 ENFORCEMENT OF LAW 12.1 Governina Law. This Lease shall be governed by, interpreted under, and construed and enforced in accordance with the laws of the State of California. 12.2 Compliance with Law. All services rendered hereunder shall be provided in accordance with all ordinances, resolutions, statutes, rules, and regulations of the City and any Federal, State, or local governmental agency having jurisdiction in effect at the time service is rendered. 12,3 Waiver. The waiver of any breach of any provision hereunder by City or Tenant shall not be deemed a waiver of any preceding or subsequent breach hereunder. No failure or delay of any Party in the exercise of any right given hereunder shall constitute a waiver thereof nor shall any partial exercise of any right preclude further exercise thereof. 12.4 Severabilitv. If any paragraph, section, sentence, clause or phrase contained in this Lease shall become illegal, null or void, against public policy, or otherwise unenforceable, for any reason, or held by any court of competent jurisdiction to be illegal, null or void, against public policy, or otherwise unenforceable, the remaining paragraphs, sections, sentences, clauses or phrases contained in this Lease shall not be affected thereby. 12.5 Termination Prior to Expiration of Term. The parties agree that if Tenant: (i) files a petition in bankruptcy, (ii) is adjudicated bankrupt, (iii) if a petition in bankruptcy is filed against Tenant and not discharged within thirty (30) days, (iv) if Tenant becomes insolvent or makes an assignment for the benefit of its creditors or an arrangement pursuant to any bankruptcy law, or (v) if a receiver is appointed for Tenant or its business during the Term of this Lease, City may terminate this Lease upon twenty-four (24) hours' written notice to Tenant. 12.6 Attornev's Fees. If either party to this Lease is required to initiate or defend or made a party to any action or proceeding in any way connected with this Lease, the prevailing USO -- Greater Los Angeles Area Page 10 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport party in such action or proceeding in addition to any other relief, which may be granted, shall be entitled to reasonable attorney's fees and costs. Section 13. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION_ 13.1 Non-liabilitv of City Officers and Emolovees. No officer or employee of the City shall be personally liable to the Tenant, or any successor in interest, in the event of any default or breach by the City or for any amount, which may become due to the Tenant or to its successor, or for breach of any obligation of the terms of this Lease. 13.2 Conflict of Interest. No officer or employee of the City shall have any financial interest, direct or indirect, in this Lease nor shall any such officer or employee participate in any decision relating to this Lease which effects his financial interest or the financial interest of any corporation, partnership or association in which he is, directly or indirectly, interested, in violation of any State statute or regulation. Tenant warrants that it has not paid or given and will not pay or give any third parry any money or other consideration for obtaining this Lease. 13.3 Standard Covenant Aoainst Discrimination. Tenant covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the performance of this Lease. Tenant shall take affirmative action to insure that applicants are employed and that employees are treated during employment without regard to their race, color, creed, religion, sex, marital status, national origin, or ancestry. 13.4 Americans With Disabilities Act. In its operation of Demised Premises, Tenant shall comply with the Americans with Disabilities Act and all federal regulations applicable under the Act. Section 14. FAA REQUIRED PROVISIONS. 14.1 Tenant, as a part of the consideration for this Lease, covenants and agrees "as a covenant running with its interest in property" that in the event facilities are constructed, maintained, or otherwise operated on the Airport or the Demised Premises for a purpose for which a Department of Transportation ("DOT") program or activity is extended or for another purpose involving the provision of similar services or benefits, the Tenant shall maintain and operate such facilities and services in compliance with all other requirements imposed pursuant to Title 49, Code of Federal Regulations DOT, Part 23, Nondiscrimination in Federally Assisted Programs of the Department of Transportation -Effectuation of Title VI of the Civil Rights Act of 1964, as such regulations may be amended from time to time. 142 This Lease is subject to the requirements of the U.S. Department of Transportation's regulations, 49 CFR Part 23. The Tenant or contractor agrees that it will not discriminate against any business owner because of the owner's race, color, national origin or sex in connection with the award or performance of any concession agreement, management contract, or subcontract, purchase or lease agreement or other agreement covered by 49 CFR part 23. 14.3 The Tenant or contractor agrees to include the above statements in any subsequent concession agreement or contract covered by 49 CFR Part 23, that it enters and causes those businesses to similarly include the statements in further agreements. USO — Greater Los Angeles Area Page 11 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport 14.4 In the event of a breach of the covenants specified in Subsection 14.1 and 142 of this Lease, City shall have the right to terminate this Lease and to reenter and repossess the Demised Premises and the facilities thereon and hold the same as if said Lease had never been made or issued. This provision does not become effective until the procedures of Title 49, Code of Federal Regulations, Part 23 are followed and completed, including the expiration of any appeal rights. 14.5 Tenant shall furnish its services on a fair, equal, and not unjustly discriminatory basis to all users thereof and it shall charge fair, reasonable, and not unjustly discriminatory prices for its services; provided that Tenant may be allowed to make reasonable and nondiscriminatory discounts, rebates, or other similar type of price reductions to volume purchases or other rational, reasonable basis. Non-compliance with this provision shall constitute a material breach of this Lease and in the event of such non-compliance, City shall have the right to terminate this Lease and any interest in property created without liability or at the election of the City or the United States either or both Governments shall have the right to judicially enforce this provision. 14.6 Tenant agrees that it shall insert the above five provisions in any lease or contract by which Tenant grants a right or privilege to any person, partnership, or corporation to render services to the public on the Demised Premises pursuant to this Lease. Nothing in this provision shall be construed as waiving any obligations or requirements of the Tenant pursuant to Subsection 4.3 of this Lease or abrogate the rights of the City pursuant to such subsection. 14.7 This Lease shall be subordinate to the provisions and requirements of any existing or future agreement between the City and the United States relative to the development, operation, or maintenance of the Airport. 14.8 This Lease, and all provisions hereof, shall be subject to whatever right the United States Government now has or in the future may have or acquire, affecting the control, operation, regulation, and taking over of the Airport or the exclusive or non-exclusive use of the Airport by the United States during a time of war or national emergency. Section 15 MISCELLANEOUS PROVISIONS 15.1 Headings. The headings of this Lease are for purposes of reference only and shall not limit or define the meaning of the provisions of this Lease. 15.2 Counterparts. This Lease may be signed in any number of counterparts, each of which will be deemed an original, but all of which together will constitute one instrument. 15.3 Labor Disputes. Tenant shall give prompt notice to City of any actual or potential labor dispute which delays or may delay performance of this Lease. 15.4 California Law. This Lease shall be construed and interpreted both as to validity and to performance of the parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Lease shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and Tenant covenants and agrees to submit to the personal jurisdiction of such court in the event of such action. U50 — Greater Los Angeles Area Page 12 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport 15.5 Disputes. In the event of any dispute arising under this Lease, the injured party shall notify the injuring party in writing of its contentions by submitting a claim therefore. The injured party shall continue performing its obligations hereunder so long as the injuring party commences to cure such default within ten (10) days of service of such notice and completes the cure of such default within forty-five (45) days after service of the notice, or such longer period as may be permitted by the injured party; provided that if the default is an immediate danger to the health, safety and general welfare, such immediate action may be necessary_ Compliance with the provisions of this Section shall be a condition precedent to termination of this Lease for cause and to any legal action, and such compliance shall not be a waiver of any party's right to take legal action in the event that the dispute is not cured, provided that nothing herein shall limit City's or the Tenant's right to terminate this Lease without cause pursuant to Subsection 5.4(c). 15.6 Riahts and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Lease, the rights and remedies of the parties are cumulative and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 15.7 Leaal Action. In addition to any other rights or remedies, either party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages for any default, to compel specific performance of this Lease, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Lease. 15.8 Reservation of Citv Riahts. City reserves the right, but shall not be obligated to Tenant, to maintain the Demised Premises and keep in good repair the Airport or the Demised Premises. The City further reserves the right to direct and control all activities of Tenant consistent with the provisions of this Lease_ 15.9 Interpretation. The terms of this Lease shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Lease or any other rule of construction which might otherwise apply. 15.10 Intearation: Amendment. It is understood that there are no oral leases between the parties hereto affecting this Lease and this Lease supersedes and cancels all previous negotiations, arrangements, leases and understandings, if any, between the parties, and none shall be used to interpret this Lease. This Lease may be amended at any time by the mutual consent of the parties by an instrument in writing. 15.11 Corocrate Authoritv. The persons executing this Lease on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Lease on behalf of said party, (iii) by so executing this Lease, such party is formally bound to the provisions of this Lease, and (iv) the entering into this Lease does not violate any provision of any other Lease to which said party is bound. 15.12 Notice. Any notice required or permitted to be given hereunder shall be in writing and signed by the Party, officer or agent of the Party to whom it is to be sent, and shall be either: (1) personally delivered to the Party to whom it is to be sent, or (2) sent via overnight courier services, or (3) sent via certified or registered mail, return receipt requested, postage prepaid to the respective addresses, or such other addresses as the Parties may specify in writing: USO — Greater Los Angeles Area Page 13 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport To City: Palm Springs International Airport Attn: Director of Aviation 3400 East Tahquitz Canyon Way, Suite OFC Palm Springs, California 92262-6966 To Tenant: USO — Greater Los Angeles Area, Inc- Attn: Gordon Fawcett, Board of Directors 203 World Way, Suite 200 Los Angeles, California 90045 USO — Greater Los Angeles Area Page 14 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport IN WITNESS WHEREOF, the parties have executed and entered into this Lease as of the date first written above. ATTEST: gy. Crty Clerk APPROVED AS TO FORM. By: City Attorney CONTRACTOR: USO — Greater Los Angels Area, Inc Check one: _Individual _Partnership _Corporation CITY OF PALM SPRINGS a municipal corporation By City Manager Corporations require two notarized signatures. One from each of the following; A. Chairman of Board, President, or any Vice President: AND B. Secretary, Assistant Secretary, Treasurer, Assistant Treasurer, or Chief Financial Officer). 89: Bv: Signature (notarized) Signature (notarized) Name: Title: State of County of as On before me, Personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) Is/are subscribed to the within instrument and acknowledged to me that helshe/they executed the same In his/her/their authorized capacity(ies), and that by his/her/their signature($) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Notary Signature: Notary Seal: LISO m Greater Los Angeles Area Non -Exclusive Operating & Lease Agreement Palm Springs International Airport Name: Title. Stale of CountyoF ss On, before me Personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose narhe(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized cepacity(ics), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and offidal seal. Notary Signature: Notary Seal: Page 15 of 17 Exhibit "A" USO Service Club Terminal Space See Attached USO — Greater Los Angeles Area Page 16 of 17 Non -Exclusive Operating & Lease Agreement Palm Springs International Airport GATE 9 GATE 7 L. Proposed USOSi[e GATE 5 indudes small room upper ngM owner (97.5sF} 65 :o 9.T5' FB' Shaded Area - Proposed USO Site Total sf Incl¢dmg small room = 975' GATE 3 GATE GATE 11 n nGATE 10 GATE 8 • • GATE S jo 91 6o r _ op _ GATE 4 CmCs 66 Palm Springs InternationalAirport GATE 2 1 .1 EXHIBIT "B" USQ Service Club Maintenance Responsibilities Tenant shall, within the demised premises, maintain, repair and pay for: Light bulb replacement Janitorial and Custodial services Carpet replacement Painting Walls, doors and glass replacement Telephone and any other Utilities not provided by City City shall provide, maintain, and repair all structural systems: Utilities: Electric, gas, and water— currently in place and provided to the demised premises Roof Fire / Life / Safety Systems Master Electrical Systems, exclusive of equipment installed by Tenant Plumbing System -- currently in place Main Water and Sewer Lines — currently in place HVAC System USO -- Greater Los Angeles Area Page 17 of 17 Nan -Exclusive Operating & Lease Agreement Palm Springs International Airport :w-� W;,ter x:»r•_:• = -- _ { JOB FLYER November 2, 2006 VOLUNTEER USO FACILITY DIRECTOR LOCATION: SALARY: APPLICATIONS ACCEPTED STARTING DATE: Palm Springs International Airport Terminal Volunteer position -- no salary Through November 15, 2006 If all approvals received — December 1, 2006 or earlier if possible JOB DESCRIPTION: The Volunteer Facility director will coordinate activities with the GLAA-USO Executive Director and the President of the GLAA-USO Board of Directors. Duties will include: 1. Direct the daily activities of the facility. Set schedule to meet customer needs 2 Coordinate recruiting, training and scheduling of volunteers. 3. Manage activities within annual approved budget. 4. Maintain accountability of cash and in -king donations 5. Direct maintenance of the USO facility. Coordinate needs with the GLAA- USO Facility Committee and Airport Management. 6. Insure high quality of customer support. Forward customer comments to the GLAA-USO Development Committee. 7. Ensure a secure and comfortable environment for volunteers and customers. All interested candidates are encouraged to submit a current resume and cover letter highlighting why they would be a good choice to get the Palm Springs International ,Airport USO Facility open and operational in a very short period of time. Please include how your work experience prepares you to fulfill the job description listed above. If all approvals are received, the goal of the facility is to be open before Christmas 2006, Please submit resumes and covers letters via mail or email to: Greater Los Angeles Area USO Gordon Fawcett, Board of Directors 203 World Way, Suite 200 Los Angeles, CA 90045 Email: FAWCETTG@comcast net