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AGREEMENT FOR LEASE, PROGRAMS AND OPERATIONS MANAGEMENT BETWEEN CITY OF MOSCOW, IDAHO, AS CITY AND HEART OF THE ARTS, INC., AS OPERATOR 412 EAST 3RD STREET, MOSCOW, IDAHO 2006-38 ---PAGE BREAK--- TABLE OF CONTENTS Page I. B AC KGR O U N D 1 1.1 Goal ! 1.2 Control 1 1.3 Benefit. ! 1.4 Civic Purpose 1 1.5 Authority 1 2. D E F I N IT I O N S ! 2.1 Agreement. . 1 2.2 c l 2.3 Operator 1 2.4 Premises 1 2.5 Permitted Use I 2.6 Term and Commencement Date ! 2.7 Rent 2 3. GR ANT O F P R E M I S E S AN D P O S S E S S I O N 2 3 .1 Grant of Premises 2 3.2 Possession 2 3.3 City's Title 2 3.4 City Arts Department 2 3.5 City and Operator 2 4. I N IT I AL T E R M AN D R E N E W AL.. 2 4.1 Initial Term 2 4.2 Renewal Term 2 4.3 Conditions Precedent to Renewal Option .3 4.3.1 Defaul\ 3 4.3.2 Financial Commitmen\.. .3 4.4 Operator's Notice of Exercise of Renewal Option 3 5. S U B S I D Y .3 5.1 Initial Term Fees 3 5.2 Fee Condition 3 5.3 Appropriation 4 5.4 Non- Appropriation 4 6. O P E R AT I O N O F P R E M I S E S 4 6.1 Operator's Use of Premises .4 6.1.1 Great Room, Plaza and Kitchen Area . . . .4 6.1.2 Existing Leases .4 6.1.3 Futme Occupancy of City Arts Department . 5 ---PAGE BREAK--- 6.2 Operating Hours 5 6.3 Approved Holidays 5 6. 4 Subletting of Premise and Approved Uses 5 6.5 Operational Performance Plan and Assessment 5 6.6 Uses Prohibited . . . 5 6.6.1 Operator Compliance with Rules . . 6 6. 7 Operator's Duties 6 6.7.1 Minor Repairs 6 6.7.2 Utilities 6 6. 7.3 General Maintenance 6 6. 7. 4 Financial Accounting 6 6.7. 4.1 H V AC System . 7 6.7. 4.2 Snow Removal . ? 6.7. 4.3 Interior Maintenance . ? 6.7. 4. 4 Additional Duties . . ? 6.7.5 Operator Improvements ? 6.7.5.1 Minor Operator Improvements 8 6.7.5.2 Major Operator Improvements . . 8 6. 8 City's Duties . . 8 6. 8.1 Major Repairs . . . 8 6. 8.2 Utilities . . . 9 6. 8.3 Maintenance . . 9 6. 8. 4 Removal of Materials . 9 6. 8.5 Failure by City to Make Major Repairs or to Perform Maintenance 9 6. 9 Labor Assistance . . 9 6.1 0 Signs . 9 6.11 Hazardous Materials . . 9 6.11.1 Operator's Hazardous Material Use 9 6.11.2 Hazardous Material Definition 10 6.12 Covenant Against Liens . . . 1 0 7. R E AL AN D P E R S O N AL P R O P E RT Y T AX E S . .10 7.1 Operator's Payment of Taxes . . 1 0 7.2 Tax Notices 1 0 8. C IT Y' S R I GHT O F E NT R Y AN D I N S P E CT I O N . . . 1 0 9. C H AN GE S I N T H E P ART I E S . . . . .11 9.1 Relationship of Parties . 11 9.2 Designation of Representatives . I I 9.3 Successors and Assigns I I 9. 4 Operator's Assignment and Subletting with City's Consent 11 9.5 City's Transfer . . . . 12 9.6 Mortgage . . . . . . . 12 11 ---PAGE BREAK--- 1 0. S U B O R D I N A T I O N, Q U I E T E N JO Y M E N T, A T T O R N M E N T, E S T O P P EL C E R T I F I C A T E l 2 I 0.1 Subordination 1 2 1 0. 2 Quiet Enjoyment 1 3 1 0. 3 Attornment 1 3 1 0. 4 Estoppel Certificate 1 3 11. I N D E M N I F I C A T I O N A N D I N S U R A N C E l 3 II. I Mutual Release; Waiver of Subrogation l 3 11. 2 Mutuallndemnifieation 1 3 11.3 Liability Insurance 1 4 11. 4 Property Insurance 1 4 11.5 Workers' Compensation Insurance 15 11.6 Auto Insurance 15 II. 7 Insurance Requirements 15 11. 8 Noncontribution 15 11. 9 Blanket Policy 15 11.10 Effect of One Party's Actions on Other Party's Insurance 15 II. II Effect of City's Insurance on Operator's Obligation l 5 1 2. D A M A GE O R D E S T R U C T I O N O F P R E M I S E S 16 1 3. C O N D E M N A T I O N 16 1 3.1 Entire or Substantial Taking 16 1 3. 2 Awards 16 1 3. 3 Sale Under Threat of Condemnation 1 3. 4 Partial T aking and Operator's Option l 7 1 4. D E F A UL T B Y O P E R A T O R O R C I T Y l 7 1 4.1 Default by Operator 17 1 4. 2 Remedies of City l 7 1 4. 2.1 Legal and Equitable Remedies 1 4. 2. 2 Termination of Agreement... . I? 1 4. 2. 3 Advance 1 8 1 4. 3 Default by City 1 8 1 4. 4 Remedies of Operator 1 8 15. T E R M I N A T I O N O F A GR E E M E N T l 8 15.1 Events of Termination . l 8 15. 2 Surrender of Possession . . 1 8 15. 3 Holding Over 1 8 15. 4 Condition of Premises upon Termination 1 9 15.4.1 Removal of Property 1 9 15. 4.2 Restoration of Premises . . . . . 1 9 16. CL A I M S A N D D I S P U T E S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 9 l1l ---PAGE BREAK--- 16.1 Rights and Remedies Cumulative . . . . . . . . . 1 9 16.2 Nonwaiver of Remedies . . . . . . . 1 9 16.3 Attorney Fees and Costs 1 9 16.4 Interpretation 20 16.5 Waiver of Jury Trial 20 17. GE N E R AL P R O V I S I O N S 20 1 8. 17.1 Notices . 20 17.2 Brokers . 20 17.3 Non-recording . . . . . 20 17.4 Time is of the Essence . . . . 21 17.5 Joint and Several Liability . . . 21 17.6 Entire Agreement- Modification in Writing- Captions . . 21 17.7 Severability . . . 21 17.8 Force Majeure . . . . 21 S I GN A T U R E S . 21 IV ---PAGE BREAK--- AGREEMENT FOR LEASE AND OPERATIONS This Agreement for Lease and Operations (hereinafter " Agreement") is made and effective this day of 20 by and between the City of Moscow, Idaho, a municipa l corporation of the State of Idaho ("City"), and Heart of the Arts, Inc., a Idaho non-profit organization acting as programs and operations manager ("Operator"). 1. BACKGROUND. 1.1 Goal. City wishes to contract the services of Operator for purposes of marketing, fundraising, operation, maintenance, and contro l of the 1 91 2 Center. 1.2 Control. City desires to transfer contro l of the 1 91 2 Center to Operator for an extended period of time. 1.3 Benefit. The City Counci l of Moscow be lieves that it is in the best interest of the City to transfer to Operator those annua l and day to day maintenance, operation and program management matters in order to promote efficiency and to a llow for the marketing, fund raising and deve lopment of the 1 91 2 Center in a manner consistent with City po licies and programs. 1.4 Civic Purpose. City wishes to ensure the continuance of estab lished and proposed civic uses in the 1 91 2 Center in order to maximize City's current investment via donations and grants. 1.5 Authority. This Agreement is authorized by Idaho Code 5 0- 301 et seq., and other provisions of the Idaho Code. 2. DEFINITIONS. The fo llowing terms sha ll have the definitions ascribed to them be low: 2.1 Agreement. Sha ll mean this document and a ll exhibits, attachments and amendments hereto. 2.2 City. City of Moscow, Idaho, whose mai ling address is 206 East Third Street, Moscow, Id aho 8 38 4 3. 2.4 Operator. Heart of the Arts, Inc., a Idaho non-profit organization whose mai ling address is P 0 Box 8 851, Moscow, Idaho, 8 38 4 3. 2.5 Premises. That certain rea l property located at 41 2 East 3'd Street, Moscow, Idaho, 8 38 4 3 consisting of land and improvements, "as is", in the current state of repair and condition as of the date of the execution of this Agreement a ll as more fu lly i llustrated on Exhibit " A " attached hereto and incorporated herein, common ly known as the 1 91 2 Center. The Premises inc ludes City's persona l property located in the common areas of the Premises but specifica lly exc ludes any persona l property of any Operator within the Premises. 2.6 Permitted Use. To the exten t practicab le, the Premises sha ll be used in furtherance of civic, community and/or phi lanthropic purposes idea lly serving a broad spectrum 1 9 1 2 CENTER LEASE Al'\D 0PERATJO»S AGREEMENT PAGE l OF 3 l ---PAGE BREAK--- of the community in age, gender, race, ability and need. Uses should be or have the potential to be self sustaining and be able to contribute toward the costs of maintenance, operation and repair of the Premises. Users of the Premises should remain adaptable and flexible in how they use and occupy the Premises so as to maximize opportunities for shared use and minimize dedicated spaces. 2.7 Term and Commencement Date. The Term of this Agreement shall commence on January I, 2007 ("Commencement Date") and shall end at midnight September 30, 2011 ("Initial Term"), unless terminated earlier in accordance with the terms of this Agreement or as extended pursuant to Section 4. 2. The Initial Term and the Renewal Term (as defined in Section 4.2) are collectively referred to as the "Term" of this Agreement. 2.8 Rent. There shall be no rent due under this Agreement. Rather, Operator shall be obligated to operate, repair, maintain and replace the Premises as set forth in this Agreement. 3. GRANT OF PREMISES AND POSSESSION. 3.1 Grant of Premises. City leases to Operator and Operator leases from City the Premises "as is", in the current state of repair and condition as of the date of the execution of this Agreement subject to the terms and conditions of this Agreement. 3.2 Possession. Subject to the rights and privileges of the tenants under the leases described in Exhibit B attached hereto and made a part hereof, City shall deliver possession of the Premises in the Premises' existing condition (including the rights, privileges, benefits, rights-of-way and easements now or in the future appur tenant to the Premises) to Operator on the Commencement Date. During the Term, City covenants not to disturb the quiet enjoyment or possession of the Premises by Operator, except as permitted by this Agreement. 3.3 City's Title. City shall have and retain paramount title to the Premises free and clear of any act or inaction of Operator that may restrict or encumber the Premises. 3.4 City Arts Department. City and Operator agree to negotiate in good faith to locate the City of Moscow Arts Department within the Premises at such time as City may seek to relocate such Department to the Premises. 3.5 City and Operator. Present uses of the Great Room, Plaza, Kitchen area, Friendship Hall and Senior Center shall not be discontinued by Operator without express written consent of City. 4. INITIAL TERM AND RENEWAL. 4.1 Initial Term. The Initial Term of this Agreement is set forth in Section 2.7. 4.2 Renewal Term. Subject to the conditions precedent set forth in Section 4.3, Operator may extend the Initial Term of this Agreement for one consecutive, additional period of twenty ( 20) years ("Renewal Term") beyond the expiration of the Initial Term upon the terms and conditions set forth in this Agreement or as mutually agreed upon in writing ("Renewal Option"). 1 9 1 2 C LNTER LEASE AND OPERATIONS AGREEMENT PAGE 2 0F 3 1 ---PAGE BREAK--- 4.3 Conditions Precedent to Renewal Option. Operator shall not be entitled to exercise the Renewal Option (or if Operator has previously exercised the Renewal Option . the exercise shall be negated), in the exercise of City's sole and absolute discretion, unless each and every of the following conditions in paragraphs 4. 3.1 and 4. 3. 2 herein have been met in full, without exception or limitation of any kind, unless otherwise agreed to by City: 4.3.1 Default. Operator has not been in default, as defined in this Agreement, in any manner, during the Initial Term of this Agreement and Operator has not received any notice of default which is pending cure either at the time Operator delivers to City Operator's election to extend the term of this Agreement , at the expiration of the Initial Term or at the commencement of the Renewal Term. Such default may, however, be waived by City pursuant to this Agreement. 4.3.2 Financial Commitment. Operator has demonstrated to City, in City's reasonable opinion, that Operator has the continuing financial ability to operate, repair and maintain the Premises for the foreseeable future in its then current condition and operation, taking into consideration all relevant factors including, without limitation, the then-current tenants, current and projected fundraising efforts of Operator and the likelihood of success from those efforts, Operator's then current financial health, assets and balance sheet (or the financial health, assets and balance sheet of any willing guarantor of Operator, provided that such guarantor enters into a guaranty of this Agreement acceptable to City in City's sole and absolute discretion), and the past payment history of Operator in all aspects of its business. Operator agrees to provide City with any documentation requested by City in order for City to make its determination. 4.4 Operator's Notice of Exercise of Renewal Option. Operator may exercise Operator's Renewal Option by giving written notice of the exercise to City at least one year before the expiration of the Initial Term ("Option Notice Period"). 5. SUBSIDY. 5.1 Initial Term Fees. During the first year of the Initial Term of this Agreement, City shall pay to Operator a fee of Five Thousand Dollars ($5,000) per month. In each succeeding year of the Initial Term , upon submission of a budget request in accordance with City's policies and procedures as established from time to time on or before April I" of each year and subject to appropriation by the City Council of the City of Moscow as set forth in Section 5.3, City shall pay to Operator five thousand dollars ($5,000) per month for each month of the initial term of this Agreement on or before the first day of each month during the Initial Term. Upon completion of the Initial Term and entrance into the Renewal Term, the initial term fees in the amount of $5,000 described herein shall cease and Operator shall assume the sole responsibility for all costs associated with the operation of the Premises. 5.2 Fee Condition. Notwithstanding Section 5.1 to the contrary, the Fee shall not be due if Operator is in default of this Agreement or upon termination of this Agreement pursuant to Section 15. 1. 5.3 Appropriation. City, by entering into this Agreement, acknowledges its current intention to make all Fee payments due during its current fiscal year on the dates such Fee 19 1 2 C ENTER L EASE ,\ND OPERA TiONS AGREEMENT PAGE 3 0F 3 1 ---PAGE BREAK--- payments are then due, but does not commit to a legal or other obligation to make such Fee payments or to incur any liability beyond the revenue and income provided during its then current fiscal year. Operator has no right to compel City to levy or to collect taxes to pay the Fee or to expend funds beyond the amount provided for in the then current fiscal year of City. City agrees during the current fiscal year and during each fiscal year during the Initial Term to use reasonable efforts to obtain authorization and appropriation of the Fee and that City shall, for the ensuing fiscal year in which the Fee payments are scheduled to be made, consider a budget and appropriation of the expenditure of an amount sufficient to allow City to make all Fee payments due in such fiscal year ; and (ii) that, to the extent sufficient funds have been appropriated for the current fiscal year, it will make all such Fee payments. 5.4 Non-Appropriation. In the event City fails to receive appropriated funds sufficient to pay the Fee in the full amount of Five Thousand Dollars ($5,000) per month, City shall notify Operator in writing of such occurrence including the amount of the appropriation, if any, upon City's confirmation of such event ("Non-appropriation Notice"). Within sixty (60) days after Operator's receipt of City's written Non-appropriation Notice, Operator may elect by written notice to City to terminate this Agreement effective as of sixty (6 0) days after City's receipt of Operator's election to terminate this Agreement. In the event Operator should fail to deliver Operator's election to terminate this Agreement within the sixty (60) days after Operator's receipt of City's written Non-appropriation Notice, this Agreement shall continue in full force and effect through the subsequent year when, if applicable, Operator again submits its budget request for the Fee and this Section 5. 4 shall again take effect. 6. OPERATION OF PREMISES. 6.1 Operator's Use of Premises. Subject to the ex1stmg leases described in Exhibit " B " and the following provisions, the Premises shall be occupied and used by Operator and any permitted subtenants of Operator only for the Permitted Use and for no other purpose. 6.1.1 Great Room, Plaza and Kitchen Area: Operator shall agree to preserve the existing uses of the Great Room, Plaza and Kitchen Area as public meeting and activity areas available upon a reservation basis during the term of the Agreement. Operator shall be responsible for the acceptance, coordination, and collection of fees for such activities and the provision of a facility supervisor during such reserved use of the Premises as agreed upon between Operator and City and in accordance with the policies, procedures and fees defined within Exhibit E attached to this agreement, or as otherwise provided for within this Agreement. All revenues generated from such fees received for the rental of the Great Room, Plaza and Kitchen areas shall be retained by Operator. Any modification to the policies, procedures and fees included within Exhibit E shall first be reviewed by the Use Committee as specified within Section 9. 4 of this Agreement. No adjustments shall be made to the fees specified within Exhibit E without the prior written consent of City. 6.1.2 Existing Leases: Operator shall honor any existing leases and agreements between City and any other party related to the Premises and subsequent renewals for the respective portions of the Premises and shall negotiate in good faith to ensure the opportunity for such leases and uses associated with such leases to continue during the term of this Agreement. 1 9 1 2 CENTER LEASE AND 0PFRATJONS AGREEMENT PAGE 4 OF 3 1 ---PAGE BREAK--- 6.1.3 Future Occupancy of City Arts Department. City and Operator agree to negotiate in good faith to locate the City of Moscow Arts Department within the Premises at such time as City may seek to relocate such Department to the Premises. The terms of such occupancy shall be mutually agreed upon in writing. 6.2 Operating Hours. Operator shall be responsible for the management and operations of the Premises which shall include ensuring that the building is unlocked and open for public access between the hours of 8:00a.m. and 5:00 p.m. Monday through Friday with the exception of the list of approved holidays included within Section 6. 3 of this Agreement. Operator shall be responsible for and shall ensure that there is a proper! y trained, equipped and designated facility supervisor within the Premises at all times that the Premises are open for public access. Operator shall be responsible for properly and appropriately locking and otherwise securing the Premises during those times other than the operating hours listed above. 6.3 Approved Holidays. For the purposes of this Agreement the following are the approved holidays; New Year's Day, Thanksgiving Day, Idaho Human Rights Day, Presidents' Day, Memorial Day, Independence Day, Labor Day, Veteran's Day, and Christmas Day. Nothing in this Agreement shall prevent Operator from operating the Premises in accordance with this Agreement on such holidays. 6.4 Subletting of Premise and Approved Uses. Sublets shall only be allowed in accordance with Sections 2.6 and 9. 4 of this Agreement. 6.5 Operational Performance Plan and Assessment. Upon execution of this Agreement, Operator and City shall negotiate in good faith to define an Operational Performance Plan which shall identify objectives and milestones to assess the performance of Operator in meeting the objectives of City for the development and operations of the Premises. Such mutual! y agreed upon Plan shall be used to assess the performance of the Operator in meeting the requirements of this Agreement by supporting the existing community uses of the Premises, in promoting, identifying and securing additional users and tenants for the Premises and in securing funds or other means of continuing the capital improvement and development of the Premises. Such Plan shall also include a fundraising plan which shall include proposed fundraising activities to support the development and operation of the Premises. Operator shall attend quarterly meetings with a designated City representative for the purpose of evaluating Operator's performance toward meeting the objectives of the Operational Performance Plan during the proceeding quarter. Operator and City shall meet at least annual! y to assess the performance of Operator and City in accordance with this Agreement. 6.6 Uses Prohibited Operator covenants and agrees that it will not use or suffer or permit any person or persons to use the Premises or any part thereof for any use or purpose in violation of the laws of the United States of America or the State of Idaho, or the ordinances, regulations and requirements of the City of Moscow, County of Latah, or other lawful authorities. 6.6.1 Operator Compliance with Rules. Operator shall comply with any building rules and regulations of City as may now or hereafter be established or from time to time amended by City. City shall not be liable to Operator for any violation of such rules. ! 9 1 2 CENTER LEASE A:\D OPERATIONS AGREEMEN'I PAGE 5 0F 3 ! ---PAGE BREAK--- 6.7 Operator's Duties. 6.7.1 Minor Repairs. Operator shall be responsible for minor repairs to the personal property included as part of the Premises. For purposes of this Agreement, "minor repairs" shall be defined as the repair, maintenance or replacement of furniture and fixtures that are not the property of current and future tenants of the Premises. 6.7.2 Utilities. During the Initial Term of this Agreement, Operator shall be solely responsible for and shall pay all charges, when due, for natural gas, electricity, water, sewer, garbage, janitorial services, telephone, cable, computer, security, and any other utility or other service used upon or furnished to the Premises. During the Initial Term of this Agreement City shall provide Operator thirty five thousand dollars ($35,000.00) annually, in addition to the Initial Term Fee, that shall be payable in twelve (1 2) installments and which is intended to fund the utility and janitorial services necessary to service the Premises in their current state of development and use. This payment shall be adjusted annually upon the effective date of this Agreement based upon the energy portion of the Consumer Price Index ( C P for all urban consumers ( C P I- U) West Side B/ C, for the immediately preceding twelve (1 2) month period to account for increased utility costs to Operator. Upon the completion of the Initial Term and transition into the Renewal Term, Operator shall assume the sole responsibility for all utility and janitorial costs for the Premises in their entirety. Operator shall provide such documentation as required by City on a basis prior to receiving such installment. 6. 7.3 General Maintenance. Operator agrees at all times, from and after delivery of possession of the Premises to Operator, and at its own cost and expense, to maintain, repair and/or replace in good and tenantable condition the Premises and every part thereof, including fixtures and equipment, and excluding only specific parts of the Premises that are to be maintained by City as set forth below. If Operator refuses or neglects to make repairs and/or maintain the Premises, or any part thereof, in a manner reasonably satisfactory to City, City shall have the right, upon giving Operator reasonable written notice of its election to do so, to make such repairs or perform such maintenance on behalf of and for the account of Operator. In such event such work shall be paid for by Operator upon receipt of a bill therefore. 6. 7.4 Financial Accounting. Operator agrees that its accounting books and other financial records pertaining to this Agreement, including, but not limited to, operations and fundraising activities related to Premises shall be open and available for examination at all times by City within a reasonable time upon request. Operator shall maintain complete accounting records for all activities including fundraising activities conducted during the term of this Agreement. Such accounting shall include the expenses of the fund raising activity, the funds collected and the expenditures of the collected funds. These records shall be preserved and made available for inspection to the City upon request throughout the term of this Agreement. Operator also agrees that it shall maintain fiscal records and accounts in accordance with systems and procedures prescribed by law or regulation as applicable to the financial affairs of the City and that Operator shall annually render a written independent financial review as mutually agreed upon by Operator and City within ninety ( 90) days after the end of each fiscal year of Operator. 1 9 1 2 CI:NTER LEASE AND OPERATIONS AGREE\1LNT PAGE60F 3 l ---PAGE BREAK--- 6.7.4.1 HVAC System. Operator, at Operator's sole cost and expense, shall be responsible for the routine maintenance of the H V A C system and shall enter into a maintenance contract reasonably acceptable to City for the performance of the same. 6.7.4.2 Snow Removal. Operator shall be responsible for snow removal from all interior sidewalks upon or adjacent to the Premises, the Outdoor Plaza as shown on Exhibit " A" and all stairways, landings, walkways and parking areas within or adjacent to the Outdoor Plaza. City shall be responsible for snow removal from all public sidewalks those parallel to the City streets) and for snow removal in the parking lots as shown on Exhibit " 6.7.4.3 Interior Maintenance. Operator shall be responsible for performing all general maintenance and cleaning to the interior of the Premises, including, but not limited to the Maintenance Schedule as set out in Exhibit " C" and incorporated herein by this reference. 6.7.4.4 Additional Duties. a. Operator shall perform all obligations under Section 6.7 in a good and workmanlike manner and in conformance with the Cleaning Quality Requirements attached hereto as Exhibit " D" and incorporated herein. b. Operator shall be responsible for securing the Premises upon completion of any repairs or maintenance by Operator or Operator's employees or agents. c. Repair and maintenance activities shall be coordinated in such manner as to minimize the impacts upon current programs and uses to the greatest extent reasonably possible. d. Operator shall provide a schedule of periodic floor, window and upholstery cleaning dates in advance to City and ensure the performance of the same. e. Operator shall attend a quarter! y meeting with City of Moscow officials, as designated by City, for the purpose of evaluating the previous quarter's maintenance. 6.7.5 Operator Improvements. Upon execution of this Agreement, Operator and City shall jointly form a 1 912 Center Facility Development Committee (hereinafter " Development Committee") which shall include the City Building Official, City Facilities Manager, a City Council member, a representative of Operator, and two representatives from the community. Community members serving on the 1 912 Center Facility Committee may also be members of the 1 912 Center Use Advisory Committee. The Development Committee shall develop and recommend a Renovation Plan for the Premises that shall be approved by the City and which shall define the life safety, structural and utility requirements for the Premises, including common use areas, the site and the building envelope to allow for the use of the undeveloped portions of the Premises. The Renovation Plan shall include the standards to be followed for all capital improvements to the Premises. The Development Committee shall also serve as the review board for all Major Operator Improvements as specified within Section 6.7.6.2 of this Agreement. 1 9 1 2 CENTER LEASE AND 0PERAT!O!',;D OPERATIONS AGR EEMENT PAGE 100F 3 1 ---PAGE BREAK--- 9. CHANGES IN THE PARTIES. 9.1 Relationship of Parties. Nothing contained in this Agreement shall be construed as creating the relationship of principal or agent, employer/employee, partnership or joint venture between the parties hereto. Neither the method of computation of Fees nor any other provision of this Agreement, nor any act of the parties, shall be deemed to create any relationship other than that of City and Operator. It is understood by the parties that Operator's employees shall not be considered employees of City for any purpose, including, without limitation, tax, retirement system, or social security ( FI C A) withholding. 9.2 Designation of Representatives. Each party shall designate, in one representative to coordinate and implement the party's obligations and to accept responsibility for the party's compliance with this Agreement. If the representative is changed, then the party shall notify the other party in writing within seven days. City's current representative is and Operator's current representative is _ 9.3 Successors and Assigns. Subject to Section 9. 4, this Agreement shall benefit and bind the successors and permitted assigns of City and Operator. 9.4 Operator's Assignment and Subletting with City's Consent. Upon execution of this Agreement Operator and City shall forrn a 1 912 Center Use Advisory Committee (hereinafter " Use Committee") having five members which shall include two representatives of Operator, a City Council member and two members of the community. Community members serving on the 1 912 Use Advisory Committee may also be members of the 1 912 Center Facility Development Committee. Requests for subletting shall be submitted in writing to the Use Committee with sufficient detail to describe the area of the Premises proposed to be sublet, the proposed Operator of such sublet, the uses that are proposed under such sublet and the compensation proposed under such sublet agreement. The Use Committee shall review the uses proposed within such sublet request for compliance with the following criteria: l . The use reflects community need or desire 2. The use has demonstrated sustainability and/or support for specified program or activity 3. The use promotes multi-generational participation and sense of community 4. The use provides opportunity for flexibility and adaptability within the building and sharing of many spaces with other uses and users 5. The use and/or user group evidences ability to contribute financially (via on-going revenue, or in-kind assistance, help in securing grants, etc.) 6. The user group or use will require a level of finish and renovation for specified program and activities that is achievable, realistic, and does not compromise historic integrity of the building 7. The use avoids unnecessary duplication of programming 8. The use does uot pose unreasonable concern to maintenance, ease of operation, security, or consume all available parking resources ! 9 1 2 CENTER LEASE AND 0PERATJ0i\S AGREE\1FNT PAGE J] OF 3 1 ---PAGE BREAK--- The Use Advisory Committee may request any additional information it deems necessary to evaluate the proposed sublet request. When multiple requests have been received for the same area of the Premises, the proposed use which best meets the criteria listed above shall be selected. The Use Commi ttee's decision regarding the sublet request shall be final. The Use Committee shall also be charged with the supervision of the Great Room, Plaza and Kitchen area rental policies and procedures and shall review and ma ke recommendations regarding any proposed rental fee changes for such areas. 9.5 City's Transfer. City may sell, assign or otherwise transfer the Premises without the consent of Operator; however, City shall notify Operator of all reasonable offers to purchase and shall grant to Operator the right of first refusal and the opportunity to match any offer of purchase on or prior to the closing date. If City should sell or transfer City's interest in the Premises, then with not less than ninety ( 90) days notice and effective with the date of the sale or transfer, City shall be released and discharged from any and all further obligations and responsibilities under this Agreement (except those already accrued). City shall give Operator not less than ninety ( 90) days notice of City's intent to sell, assign, or otherwise transfer the Premises. After such notice, Operator shall have sixty (60) days within which to exercise its option to terminate this Agreement and to vacate the Premises at the time of sale, assignment, or other transfer (unless otherwise agreed wi th the buyer, assignor, or other transferee). If Operator fails to exercise such option to terminate hereunder, the terms of this Agreement shall continue to bind Operator and the buyer, assignee, or other transferee. 9.6 Mortgage. Operator shall not, either voluntarily or by operation of law, encumber, pledge, transfer or hypothecate all or any part of the Premises or Operator's rights hereunder. 10. SUBORDINATION, QUIET ENJOYMENT, ATTORNMENT, ESTOPPEL CERTIFICATE. 10.1 Subordination. This Agreement, at City's option, shall be subject and subordinate to the lien of any mortgages or deeds of trust in any amount or amounts whatsoever now or hereafter placed on or against the land or improvement or either thereof, of which the Premises are a part, or on or against City's interest or estate therein, wi thout the necessity of the execution and delivery of any further instruments on the part of Operator to effectuate such subordination ; provided, however, that so long as the Operator shall not be in default under the terms of this Agreement, the Agreement shall not be terminated nor shall any of the Operator's rights and obligations under the Agreement be disturbed by such lender in the exercise of its rights under the deed of trust or mortgage. If any mor tgagee or beneficiary shall elect to have this Agreement prior to the lien of its mor tgage or deed of trust, and shall give written notice thereof to Operator, this Agreement shall be deemed prior to such mortgage or deed of trust, whether this Agreement is dated prior to or subsequent to the date of the mortgage or deed of trust, or the date of the recording thereo f. Operator covenants and agrees to execute and deliver upon demand without charge therefor , such fu rther instruments evidencing such subordination of this Agreement to the lien of any such mortgages or deeds of tmst as may be required by City. 1 9 1 2 CENTER LEASE AND OPERATIONS AGREEMENT PAGE 1 2 0F 3 l ---PAGE BREAK--- 10.2 Quiet Enjoyment. City agrees that Operator, upon paying any monetary sums due under this Agreement and performing the covenants and conditions of this Agreement and upon recognizing any subsequent purchaser as City, may quietly have, hold and enjoy the Premises during the term hereof; subject, however, to all restrictions and covenants contained or referred to in this Agreement. 10.3 Attornment. In the event of a foreclosure or the exercise of the power of sale under any mortgage or deed of trust made by City covering the Premises, Operator shall attorn to the purchaser upon any such foreclosure or sale and recognize such purchaser as the City under this Agreement, provided the purchaser expressly agrees in writing to be bound by the terms of this Agreement. 10.4 Estoppel Certificate. Operator shall, from time to time, upon written request of City, execute, acknowledge and deliver to City a written statement certifying that this Agreement is unmodified and in full force and effect (or that the same is in full force and effect as modified, listing the instruments of modification), and whether or not to the best of Operator 's knowledge, City is in default hereunder (and, if so, specifying the nature of the default), it being intended that any such statement delivered pursuant to this paragraph may be relied upon by a prospective purchaser of City 's interest or a mortgagee of City 's interest or assignee of any mortgage upon City 's interest in the Premises. If Operator shall fail to respond within ten (10) days of receipt by Operator of a written request by City as herein provided, Operator shall be deemed to have given such certificate as above provided without modification. 11. INDEMNIFICATION AND INSURANCE. 11.1 Mutual Release; Waiver of Subrogation. City and Operator hereby each release the other party and anyone claiming through or under the other party by way of subrogation or otherwise from any and all insured loss of or damage to Premises, or Operator's personal property, whether or not caused by the negligence or fault of the other party. In addition, Operator shall cause any property insurance policy carried by it which insures the Premises or the contents thereof to be written to provide that the insurer waives all rights of recovery by way of subrogation against City in connection with any loss or damage covered by the policy. 11.2 Mutual Indemnification. Subject to the terms of Section 1 above, Operator hereby releases City and does covenant and agree to inde mnify, defend, protect and hold City harmless against and from any and all damages, losses, liabilities, obligations, penalties, claims, litigation, demands, defenses, judgments, suits, proceedings, costs, disbursements or expenses of any kind or of any nature whatsoever (including, without limitation, attorneys' and experts' fees and disbursements) which may at any time be imposed upon, incurred by or asserted or awarded against City arising from or in connection with the loss of life, personal i njury and/or damage to property occasioned by any negligent or willful act or omission of Operator or its agents, contractors, servants or employees during the Term of the Agreement. Subject to the limits of liability specified in Idaho Code 6- 901 through 6- 929, known as the Idaho Tort Claims Act, City shall inde mnify and hold Operator, its agents and assigns, harmless from and/or against any and all claims, damages, and liabilities (including reasonable attorney's fees) that may be suffered or incu n-ed and that arise as a direct result of a ud which are caused by City's possession , control, operations or performance under this Agreement . City's liability coverage is provided through a 1 9 1 2 CENTER LEASE AND 0PE.RAT!ONS AGREEMENT PAGE l 3 OF 3 1 ---PAGE BREAK--- self-funded liability program administered by the State of Idaho Office of Insurance Management. Limits of liability, and this inde nmification, are $5 00,000 Combined Single Limits, which amount is the City's limit of liability under the Idaho Tort Claims Act. In addition, Operator covenants and agrees to indemnify, defend, protect and hold City harmless against and from any and all damages, losses, liabilities, obligations, penalties, claims, litigation, demands, defenses, judgments, suits, proceedings, costs, disbursements or expenses of any kind or of any nature whatsoever (including, without limitation, attorneys' and experts' fees and disbursements) which may at any time be imposed upon, incurred by or asserted or awarded against City and arising from or in co nnection with the loss of life, personal injury and/or damage to property arising from or out of any occurrence in or upon the Premises, unless caused by any negligent or willful act or omission of City or its agents, contractors, servants or employees . An inde nmified party shall have the right to engage its own attorneys in co nnection with any of the provisions of this Section 11.2 or any of the provisions of this Agreement, including, but not limited to, any defense of or intervention by such party, notwithstanding any contrary provisions of the laws or court decisions of the state in which the Premises is located. 11.3 Liability Insurance. Operator shall provide and maintain commercial general liability insurance ( Occurrence Basis) with broad form coverage endorsement covering its obligations under this Section 11 and insuring it against claims for personal injury, bodily injury or death, and property damage or destruction. Such insurance shall be written with an insurer licensed to do business in the state of Idaho, shall name City as additional insured on the policy and shall contain a waiver of subrogation endorsement in favor of City. The initial limits of liability of all such insurance shall be not less than one million dollars ($1,000,000) for personal injury or bodily injury or death of any one person, one million dollars ($1,000,000) for personal injury or bodily injury or death of more than one person in one occurrence and five hundred thousand dollars ($500,000) with respect to damage to or destruction of property ; or . in lieu of such coverage, a combined single limit (covering personal injury, bodily injury or death and property damage or destruction) with a limit of not less than two million dollars ($2,000,000) per occurrence. Furthermore, City shall have the right to reasonably adjust the dollar amounts required by this Section 11.3 from time to time in City's sole discretion upon thirty (30) days prior written notice to Operator. 11.4 Property Insurance. City, at City's sole cost and expense, shall purchase and maintain casualty insurance insuring the replacement cost of all improvements, buildings, structures, furniture, fixtures, and equipment located on the Premises in such amounts and in such form as City may determine. 11.5 Workers' Compensation Insurance. Operator, at Operator's sole cost and expense, shall carry Workers' Compensation Insurance as required by Idaho law. No "alternative" forms or self insurance coverage shall be allowed . 11.6 Auto Insurance. Operator, at Operator's sole cost and expense, shall carry Commercial Business Automobile Liability Insurance ( Occurrence Basis) with one million dollars ($1,000,000) combined single limit coverage. Such insurance shal l be endorsed with a waiver of subrogation endorsement in favor of City and include coverage for hired and non owned vehicles and owned vehicles if Operator owns a vehicle. Furthermore, City shall have the right to reasonably adjust the dollar amounts required by this Section 11.6 from time to time in City's sole discretion . 1 9 1 2 CENTER LEASE A!\D 0PERAT!01'.;S AGREEMENT PAGE l 4 0F 3 l ---PAGE BREAK--- 11.7 Insurance Requirements. For all insurance which Operator is required to maintain hereunder, Operator shall fu rnish City with certificates evidencing the insurance. All policies shall be obtained from an insurer licensed to do business in the State of Idaho, with a Best's Rating of " A" or higher and a Financial Size Category of " V I I I" or higher, or the equivalent thereof . The policies of insurance shall provide that the insurance represented by the certificates shall not be cancelled, materially changed or nonrenewed without the giving of thirty (30) days' prior written notice to the holders of the insurance and the holders of the certificates. If Operator shall fail to obtain any policy of insurance required hereunder, City may obtain the same and keep the insurance in effect, and Operator shall pay City the cost thereof plus a ten percent (10 service charge to cover City's administration costs within ten (10) days after receipt of an invoice . No policy will contain a deductible or self-insured retention in excess of five thousand dollars ($5,000) without City's prior written approval . If requested by City, Operator will deliver to City a certified copy of any insurance policies required by this Agreement. If the forms of policies, endorsement, certificates, or evidence of insurance required by this Section 11 are superseded or no longer available or the rating service of insurers is no longer available or modified, City will have the right to require other equivalent or better forms. Furthermore, City shall have the right to adjust the dollar amounts required by this Section 11 from time to time in City's sole discretion. 11.8 Noncontribution. All insurance carried by Operator hereunder shall be primary and not contributory with any other insurance which is maintained by City. 11.9 Blanket Policy. All insurance which Operator is required to maintain hereunder may be provided under a blanket policy provided such policy otherwise complies with the requirements of this Agreement and is endorsed with an Aggregate Limits of Insurance ( Per Location) endorsement . 11.10 Effect of One Party's Actions on Other Party's Insurance. Neither party shall do or permit to be done any thing which shall invalidate any insurance carried by the other party. Each party shall pay the entire increase in the insurance premium if the increase is specified by the other party's insurer as caused by the actions or omissions of the party. 11.11 Effect of City's Insurance on Operator's Obligation. From time to time and without obligation to do so, City may purchase insurance against damage or liability arising out of or related to the Premises . The purchase or failure to purchase insurance shall not release or waive the obligation s of Operator set forth in this Agreement. Operator waives all claims on insurance purchased by City. 12. DAMAGE OR DESTRUCTION OF PREMISES. If at any time during the Term hereof, the Premises are damaged and such damage is not "substantial " as that term is hereinafter defined, and Operator is not responsible for the repair of such damage pursuant to Section 5 hereof, then City shall repair such damage at City's expense, and this Agreement shall continue in full force and effect. If at any time during the term hereof the Premises are damaged and if such damage is "substantial " as that term is hereinafter defined, then City may at its option either repair such damage as soon as reasonably possible at City's expense, in which event, this Agreement shall continue in full force and effect, or (b ) cancel and terminate this Agreement as of the date of the occurrence of such ! 9 1 2 CENTER LEASE AND OP ERATiO NS AGR EF:MENT PAGE 1 5 0F 3 1 ---PAGE BREAK--- damage, by giving Ope rato r w ritten notice of its election to do so within sixty (60) days afte r the date of occu rrence of such damage. If the P remises a re dest royed o r damaged and City repai rs o r resto res them pu rsuant to the p rovisions of this section, then Ope rato r shall continue ope rations in the P remises to the extent reasona bly p ractica ble f rom the standpoint of p rudent business managemen t Ope rato r shall have no claim against City fo r any damages suffe red by Ope rato r by reason of any such damage, dest ruction, repai r o r resto ration, p rovided City unde rtakes and accomplishes repai rs in a reasona bly timely fashion. In the event the damage to the P remises, requi ring new const ruction o r need of repai r of the same, is caused by the negligence o r willful acts of Ope rato r o r Ope rato r's employees and agents, the re shall be no duty to repai r the same on the pa rt of the City and Ope rato r shall be responsi ble fo r said repai rs. Fo r the pu rpose of this section, "su bstantial " damage to the P remises o r the building in which the P remises a re located shall be deemed to be damaged, the estimated cost of repai r of which exceeds ten pe rcent ( 10 of the then estimated replacement cost of the P remises o r building, as the case may be. The dete rmination in good faith by City of the estimated cost of repai r of any damage and/o r of the estimated replacement cost of the P remises o r building, as the case may be, o r any pa rt the reof shall be conclusive fo r the pu rpose of this section. 13. CONDEMNATION. In the event of a condemnation o r taking unde r powe r of eminent domain, the pa rties shall have the following rights: 13.1 Entire or Substantial Taking. If the enti re P remises, o r so much the reof as to make the balance not reasona bly adequate fo r the conduct of Ope rato r's ope rations, notwithstanding resto ration by City as he rein p rovided, shall be taken unde r the powe r of eminent domain, this Ag reement shall automatically te rminate as of the date on which the condemning autho rity takes title o r possession, whicheve r shall fi rst occu r. 13.2 Awards. Any awa rd fo r any taking of all o r any pa rt of the P remises unde r the powe r of eminent domain shall be the p rope rty of City, whethe r such awa rd shall be made as compensation fo r diminution in value of the leasehold o r fo r the taking of the fee. Nothing contained he rein, howeve r, shall be deemed to p reclude Ope rato r f rom o btaining, o r to give City any inte rest in, any awa rd to Ope rato r fo r loss of o r damage to Ope rato r's fixtu res and remova ble pe rsonal p rope rty o r fo r damage fo r cessation o r inte rruption of Ope rato r's business. 13.3 Sale Under Threat of Condemnation. A sale by City to any autho rity having the powe r of eminent domain, eithe r unde r th reat of condemnation o r while condemnation p roceedings a re pending, shall be deemed a taking unde r the powe r of eminent domain fo r all pu rposes unde r this section. 13.4 Partial Taking and Operator's Option. A taking of twenty pe rcent (20 o r mo re of the leased floo r a rea of the P remises shall confe r upon Ope rato r the option, to be exe rcised only within sixty (60) days afte r Ope rato r shall have received w ritten notice the reo f. to te rminate this Ag reement effective as of the date of such taking, upon w ri ten notice to City. 1 9 1 2 CENTER LEASE Al\D OPERATIONS AGREEME»T PAGE l 6 0F 3 l ---PAGE BREAK--- Failure of O perator to exerci se such o ption shall con stitute O perator 's agreement that the balance of the Premi se s i s rea sonabl y adequate for the conduct of O perator's bu sine ss, and thi s Agreement shall remain in effect. 14. DEFAULT BY OPERATOR OR CITY. 14.1 Default by Operator. O perator shall be in default under thi s Agreement if an y of the follo wing occur: O perator fail s to pa y when due an y pa yment s required to be paid b y O perator pur suant to thi s Agreement and the failure shall not be cured within ten (10) da ys after deliver y of written notice to O perator of the failure; (ii) O perator fail s to perform or ob serve an y other covenant, agreement or condition which O perator i s required to perform or ob serve and the failure shall not be cured within thirt y ( 30) da ys after deliver y of written notice to O perator of the failure (or, if the cure cannot be effected within the thirt y ( 30) da y period, then within the additional period of time a s ma y be required to cure the default provided O perator i s diligentl y and continuou sl y pur suing the cure to com pletion); or (vi) O perator vacate s or abandon s all or a sub stantial portion of the Premi se s ( O perator shall be conclu sivel y deemed to have abandoned the Premi se s if O perator shall be ab sent from the Premi se s for ten (1 0) or more con secutive da ys). In the event O perator cure s a default within the a pplicable time frame set forth above, no default shall be deemed to have occurred under thi s Agreement. 14.2 Remedies of City. In the event of O perator's default a s set forth in Section 1 4.1, Cit y, u pon the giving of thirt y ( 30) da ys' (ten [10 ] da ys' in the event of a failure to pa y mone y) prior written notice to O perator and O perator's failure to remed y the default within such notice period, shall have the remedie s set forth in thi s Agreement including termination of all pa yment s b y Cit y to O perator. Cit y' remedie s are cumulative and not alternative remedie s. 14.2.1 Legal and Equitable Remedies. Cit y and O perator shall have all remedie s available at la w or in equit y. 14.2.2 Termination of Agreement. In addition to all other right s and remedie s available to Cit y in la w and equit y, Cit y ma y change the lock s and lock the door s to the Premi se s and exclude O perator from the Premi se s, (ii) enter the Premi se s and remove all per son s and pro pert y therefrom without being liable for pro secution or an y claim for damage s for the removal, (iii) declare the Agreement terminated, (iv) commence litigation for an y damage s su stained b y Cit y, continue the Agreement in effect and relet the Premi se s on such term s and condition s a s Cit y ma y deem advi sable, and (vi) hold the O perator liable for the rea sonable co st of obtaining po sse ssion of the Premi se s, the rea sonable co st of reletting the Premi se s (including broker 's commi ssion and the rea sonable co st of an y re pair s and alteration s nece ssar y to pre pare the Premi se s for reletting, le ss an y mone y actuall y received from the reletting, if an y. 14.2.3 Advance. In the event of O perator's breach, Cit y ma y remed y the breach for the account and at the ex pen se of O perator. If Cit y at an y time, b y rea son of the breach, i s com pelled to pa y, or elect s to pa y, an y mone y or do an y act which will require the pa yment of an y mone y, or i s com pelled to incur a n y ex pen se, including rea sonable attorne ys' fee s, in in stituting or pro secuting an y action or proceeding to enforce Cit y's right s under thi s Agreement, the mone y paid b y Cit y, with intere st from the date of pa yment , shall be deducted from an y Fee s due pur suant to thi s Agreement. 1 9 1 2 CENTER LEASE. AND 0PERATIO:-.:S AGREEMENT PAGE 1 7 0F 3 1 ---PAGE BREAK--- 14.3 Default by City. City shall be in de fault under this Agreement i f City fails to per form or observe any covenant, agreement or condition which City is required to per form or observe and the failure shall not be cured within thirty (30) days a fter delivery o f written notice to City by Operator o f the failure (or, i f the cure cannot be e ffected within the thirty day period, then within the additional period o f time as may be required to cure the de fault provided City is diligently and continuously pursuing the cure to completion). 14.4 Remedies of Operator. In the event o f City 's de fault as set forth in Section 12.3, Operator shall have all rights provided at la w or in equity, except Operator expressly waives any right to withhold per formance o f any o f Operator 's maintenance, repair or replacement obligations set forth in this Agreement. 15. TERMINATION OF AGREEMENT. 15.1 Events of Termination. This Agreement shall terminate upon the occurrence o f one or more o f the follo wing events: by mutual written agreement o f City and Operator ; (ii) by City pursuant to this Agreement ; (iii) by Operator pursuant to this Agreement ; (iv) upon lapse o f the Term ; any time prior to October 1, 2007 upon City 's receipt o f thirty (30) days' prior written notice from Operator ; or (vi) by reason o f Sections 12 or 13 relating to casualty or condemnation o f the Premises. 15.2 Surrender of Possession. Upon termination o f this Agreement, Operator will immediately surrender possession o f the Premises to City. I f possession is not immediately surrendered, City may, in compliance with the la ws o f the state in which the Premises are located, re-enter and repossess the Premises and remove all persons or property. 15.3 Holding Over. I f Operator fails to deliver actual possession o f the Premises to City upon termination o f this Agreement, City shall have all remedies available at la w or in equity to a lessor o f real property in the State o f the Premises ' location, plus one o f the follo wing remedies : City may recover damages from Operator in an amount equal to all damages sustained by City by reason o f Operator's failure to deliver actual possession o f the Premises to City; or (ii) City may accept Operator 's failure to deliver actual possession o f the Premises to City as an irrevocable o ffer to rene w this Agreement for a month to month period. 15.4 Condition of Premises upon Termination. Operator, upon termination or abandonment o f this Agreement or termination o f Operator's right o f possession, agrees as follo ws : 15.4.1 Removal of Property. Except as permitted by this Agreement, Operator shall not remove any alterations, improvements or additions made to the Premises by Operator or others without the prior written consent o f City, which consent may be withheld for any reason or for no reason. Operator shall immediately remove, in a good and workmanlike manner all personal property o f Operator. All damage occasioned by the removal shall be repaired by Operator in a good and workmanlike manner. I f Operator fails to remove any property, City may accept the title to the property without credit or compensation to Operator, or (ii) remove and store the property, at Operator 's expense, in any reasonable manner that City may choose. 1 9 1 2 CENTER LEASE AND OPERATIONS AGREEMENT PAGE 1 8 m 3 ! ---PAGE BREAK--- 15.4.2 Restoration of Premises. Operator shall restore the Prem ises to a broom clean cond it ion and in the cond it ion ex ist ing on the Commencement Date, w ith the except ion of ord inary wear and tear. If Operator fa ils to properly restore the Prem ises, City, at Operator's expense, may restore the Prem ises in any reasona ble manner t hat City may choose. 16. CLAIMS AND DISPUTES. 16.1 Rights and Remedies Cumulative. Except as expressly prov ided in th is Agreement, each party's r ights and remed ies descr ibed in th is Agreement are cumulat ive and not alternat ive remed ies. 16.2 Nonwaiver of Remedies. A wa iver of any cond it ion stated in th is Agreement shall not be impl ied by any neglect of a party to enforce any remedy ava ila ble by reason of the fa ilure to o bserve or perform the cond it ion. A wa iver by a party shall not affect any cond it ion other than the one spec if ied in the wa iver and a wa iver shall wa ive a spec if ied cond it ion only for the t ime and in the manner spec if ically stated in the wa iver. The acceptance by City of compensat ion from Operator after term inat ion of the Agreement, after term inat ion of Operator's r ight of possess ion, after the occurrence of a default, or after inst itut ion of any remedy by City shall not alter, d im in ish, affect or wa ive the Agreement term inat ion, term inat ion of possess ion, default or remedy. 16.3 Attorney Fees and Costs. If City incurs attorney fees or costs to enforce any term, covenant or cond it ion of th is Agreement, includ ing to recover possess ion of the Prem ises, Operator shall pay City a reasona ble sum for attorney's fees and costs and, if legal act ion is taken, such fees shall be deemed to have accrued on the commencement of such act ion and shall be pa id whether or not such act ion is prosecuted to judgment. L ikew ise, if Operator incurs attorney fees or costs to enforce any term, covenant, or cond it ion of th is Agreement, City shall pay Operator a reasona ble sum for attorney's fees and costs, and if legal act ion is taken, such fees shall be deemed to have accrued on the commencement of such act ion and shall be pa id whether or not such act ion is prosecuted to judgment. Should City, w ithout fault of City, be made a party to any l it igat ion inst ituted by Operator or by any th ird party aga inst Operator , or by or aga inst any person hold ing or us ing the Prem ises through or under Operator, or for the foreclosure of any l ien for la bor or mater ials furn ished to or for Operator, or otherw ise ar is ing out of or result ing from any act or om iss ion of Operator, Operator covenants to save and hold City harmless from any judgment rendered aga inst City and/or the Prem ises or any part thereof, and all costs and expenses, includ ing reasona ble attorney's fees, incurred by City in or in connect ion w ith such l it igat ion. 16.4 Interpretation. Th is Agreement shall be governed by the law of the state in wh ich the Prem ises are located. The courts in the state where the Prem ises are located shall have exclus ive jur isd ict ion. The inval id ity of any port ion of th is Agreement shall not affect the val id ity of any other port ion of th is Agreement. Th is Agreement const itutes the ent ire, completely integrated agreement among the part ies and supersedes all pr ior memoranda, correspondence , conversat ions and negot iat ions. Whenever t he consent of e ither party is requ ired to an act ion under th is Agreement, consent shall not be u nreasona bly w ith held or delayed. 1 9 1 2 CENTER LEASE A:-<0 OPERATIONS AGREEMENT PAGE l 9 or-· 3 1 ---PAGE BREAK--- 16.5 Waiver of Jury Trial. C ity and Operator hereby agree that each of the m shall wa ive tr ial by jury in any act ion, proceed ing or countercla ims brought by e ither C ity or Operator aga inst the other. Th is wa iver appl ies to any matters whatsoever ar is ing out of or in any way connected w ith th is Agree ment , or the relat ionsh ip of C ity and Operator , or Operator's use of the Pre mises , or any e mergency statute , or any re medy author ized by statute. 17. GENERAL PROVISIONS. 17.1 Notices. All not ices g iven pursuant to th is Agree ment shall be in wr it ing and shall be g iven by personal serv ice , by Un ited States cert if ied ma il , return rece ipt requested , or by Un ited States express ma il or other establ ished express del ivery serv ice (such as Federal Express) w ith s ignature conf ir mat ion requ ired , postage or del ivery charge prepa id , addressed to the appropr iate party at the address set forth in Sect ion 2 of th is Agree ment. The person and address to wh ich not ices are to be g iven may be changed at any t ime by such party upon wr itten not ice to the other party. All not ices g iven pursuant to th is Agree ment shall be dee med g iven upon rece ipt. For the purpose of th is Agree ment , the ter m "receipt" shall mean the earl ier of any of the follow ing: ( i) the date of del ivery of the not ice or other docu ment to the address spec if ied pursuant to sect ion 2 as shown on the return rece ipt , ( ii) the date of actual rece ipt of the not ice or other docu ment by the person or ent ity spec if ied pursuant to , or ( iii) in the case of refusal to accept del ivery or inab il ity to del iver the not ice or other docu ment , the earl ier of ( A) the date of the atte mpted del ivery or refusal to accept del ivery , ( B) the date of the post mark on the return rece ipt , or ( C) the date of rece ipt of not ice of refusal or not ice of nondel ivery by the send ing party. 17.2 Brokers. C ity and Operator each represent and warrant that it has ne ither e mployed nor assoc iated w ith any broker or agen t in connect ion w ith th is Agree ment and have not agreed to pay any co mmiss ions or f inders fees to any other broker . C ity and Operator each hereby agrees to inde mn ify and defend the other aga inst any and all co mmiss ions, f inders fees or other fee or any cla im therefor by any broker in connect ion w ith th is Agree ment cla iming through the inde mn ify ing party. 17.3 Non-recording. Th is Agree ment or any me morandu m of th is Agree ment shall not be recorded unless all part ies further consent. 17.4 Time is of the Essence. T ime is of the essence w ith respect to the obl igat ions to be perfor med under th is Agree ment. 17.5 Joint and Several Liability. If there is more than one Operator , the obl igat ions imposed by th is Agree ment upon Operator shall be jo int and several. 17.6 Entire Agreement · Modification in Writing · Captions. Th is Agree ment conta ins the ent ire agree ment of the part ies. No representat ions, pro mises , or agree ments oral or otherw ise between the part ies not conta ined in th is Agree ment shall be of any force and effect. Ne ither th is Agree ment nor any prov is ions hereof may be changed, wa ived , d ischarged, or ter minated except in wr it ing executed by C ity and Operator. The part ies acknowledge that minor changes to th is Agree ment may be necessary fro m t ime to t ime and hereby agree that such may be proposed in wr it ing to the other party. A response to a proposa l for mod if icat ion shall be g iven w ith in forty f ive ( 45) days of rece ipt of the proposed change. The capt ions for Agree ment 1 9 1 2 CEN"D¼R LEASE AND OPERATIONS AGREEMENT PAGE 20 OF 3 1 ---PAGE BREAK--- Sections are for convenience only and shall have no effect upon the or interpretation of any part of this Agree ment. 17.7 Severability. The illegality, invalidity or unenforceability of any ter m, condition, or provision of the Agree ment shall in no way i mpair or invalidate any other ter m, condition, or provision of the Agree ment. All such other ter ms, conditions, and provisions shall re main in full force and effect. 17.8 Force Majeure. Ti me periods for City's perfor mance under this Agree ment, including services to be furnished by City as provided for in this Agree ment, shall be extended for periods of ti me during which City's perfor mance is prevented due to circu mstances beyond City's control . This would include, without li mitation, strikes, e mbargoes , repairs, alterations, gove rnmental action, acts of God, war, or other strife. City shall not be liable for any costs or da mages incurred by Operator due to such circu mstances. Suspension or interruption of any services provided by City shall not be dee med an eviction, or relieve Operator of any obligation under this Agree ment. 18. SIGNATURES. C I T Y: O P E R A T O R: C I T Y O F M O S C O W, I D A H O 1 9 1 2 CENTER LEASF AND OPERATIONS AGREEMENT f1r PAGE 2 1 OF 3 1 ---PAGE BREAK--- A C KN O W L E D GM E N T S T A T E O F I D A H O ) ) ss. C O U N T Y O F L A T A H ) On this day of 2006, before me, a Notary Public in and for said State, appeared , kno wn to me to be the person named above and ackno wledged that he/she executed the foregoing document as the duly authorized representative for Heart of the Arts, Inc. 1 9 1 2 CE:-