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10-1019_THE OAKS FARM_License Agreement LICENSE AGREEMENT This License Agreement ("Agreement") is made this day of 010, by and between the City of San Juan Capistrano, a municipal corporation, and ("LICENSOR"), and The Oaks, Inc., a Delaware corporation, doing business in California as The Oaks Farms ("LICENSEE"). RECITALS WHEREAS, LICENSOR is the owner of approximately 118.5 acres of property generally described as Assessor's Parcel Number (APN) 125-172-07, which was acquired to be maintained as open space within the City of San Juan Capistrano; and WHEREAS, LICENSEE currently maintains equestrian paddocks and arenas on a portion of APN 125-172-07 pursuant to that certain lease agreement, dated September 1, 1999, by and between the prior property owners and LICENSEE, which lease is commonly referred to as the "Oaks Paddock Lease"; and WHEREAS, LICENSEE desires to continue to use an approximately 2.46 acre portion of property located in the corner of APN 125-172-07 for equestrian paddock and arena operations; and WHEREAS, the parties desire to terminate the Oaks Paddock Lease in return for the grant of license and the terms and coniitions herein. LICENSE NOW, THEREFORE, LICENSOR and LICENSEE do hereby mutually agree as follows: Section 1. Grant of License/Term, (a) Grant of License. LICENSOR hereby grants to LICENSEE a License to establish and maintain a temporary equestrian paddock and arena operation on the Premises, as depicted on the site plan attached hereto as Exhibit "A" and incorporated herein by reference (hereinafter referred to as the "Premises"). The scope of the License granted herein is more specifically described in Section 3 of this Agreement. LICENSEE shall provide the expertise, supervision and management over the activities and uses authorized herein. Except as otherwise provided in this Agreement, the Premises shall not be used for any other purpose. Page 1 of 10 �; 732749.1 (b) Term. i. Original Term. The initial term of this Agreement shall be from the date of execution of the Agreement through and until December 31, 2015 (the "Original Term"), unless sooner terminated. ii. Renewal Terms. The term of this Agreement may be extended for up to three (3) additional five-year periods beyond the Original Term pursuant to this Section. Each additiona,l.five-year term shall be referred to herein as a "Renewal Term." Upon the expiration of the Original Term and/or the first two (2) Renewal Terms, the Term of this Agreement shall be automatically extended for another five-year period, provided that (1) neither party provides the other party with a prior one-year written notice of its election to terminate this License; (2) there exist no Default or Event of Default under the License; and (3) this Agreement has not been terminated in accordance with terms hereof. iii. Termination. Notwithstanding the foregoing, during any Renewal Term, either party may terminate this Agreement without cause by providing the other party with at least one year written notice. Section 2. License Fee. (a) LICENSOR shall receive from LICENSEE a license fee of Four Thousand Eight Hundred Dollars ($4,800) annually,. to be paid on or before September 1 of each year in the form of a check payable to the.City of San Juan Capistrano. (b) The license fee shall be adjusted;annually on September 1 at each anniversary of the Agreement in the amount equal to.the percentage increase in the consumer price index for the Los Angeles-Riverside-Orange County Metropolitan Area, all wage earners, for the prior 12-month period (March to March), rounded to the nearest dollar. Section 3. Sca e of License and Conditions Re uirements and Limitations Thereof. (a) Permissible Uses. LICENSEE may use the Premises for maintaining a temporary equestrian paddock and arena operation for the purpose of supplementing LICENSEE's operations on the adjacent property. LICENSEE may also use the Premises for placement of above ground (boxed / canned) Oak trees being grown by The Oaks Farms, which are acorn grown from its grove of old growth Oak trees. LICENSEE shall maintain equestrian fencing as approved by LICENSOR along those boundaries of the Premises that are adjacent to other portions of APN 125-172-07 or other public right of way. LICENSEE shall be responsible for the supervision and management of every aspect of its operations on the Premises. All improvements to the property shall be considered temporary and will be subject to written approval by the City. No permanent or temporary stabling of equines is allowed on the property. LICENSEE shall use and maintain the Premises and Page 2,of 10 732 749.1 perform all operations in a competent manner, consistent with the standards of the industry and in accordance with all applicable Federal, State and local regulations, including the City of San Juan Capistrano Municipal Code. LICENSEE shall obtain, at its sole cost and expense, all governmental permits and authorizations of whatever nature required by any governmental agencies having jurisdiction over LICENSEE's use of the Premises. (b) Southern California Edison Easement. All uses and operations on the Premises shall be subject to the Southern California Edison easement attached here to as Exhibit "B" and incorporated herein by reference (the "Easement"). (c) Condition of Premises. LICENSEE accepts the Premises in its present condition, as is", upon execution of this License. LICENSOR makes no warranty of the suitability of the Premises for LICENSEE's intended uses and expressly disclaims any warranty or representation with regard to the condition, safety, security or suitability for LICENSEE's intended use of the Premises. The duly authorized representative of LICENSOR may enter upon the Premises and all structures and buildings thereon, or any portion thereof; at any time, and from time to time. (d) Maintenance of Premises. LICENSEE may use the existing structures on the Premises for LICENSEE's use in equestrian paddock and arena operations. LICENSEE shall maintain, at LICENSEE's expense, the Premises, including all existing structures and all equipment owned and furnished by LICENSEE, in a reasonable state of repair and working order. LICENSEE agrees, at LICENSEE's expense, to use reasonable care to control all weeds growing on Premises; keep the Premises clean of trash, debris and rubbish; and to keep fences, ditches, landscaping and borders of the Premises in good condition and repair at all times, reasonable wear and tear expected. (e) Development of Multi-Use Trail Extension and Trail Restin Area. i. Pursuant to the grant of such access, LICENSEE shall develop the extension of the existing multi-use trail from its current terminus at the southwest corner of the Premises approximately ninety(90) feet east along the southerly border of the Premises to the City's arizona crossing (the "Crossing) gate on APN 125-172=0. 7. In addition, LICENSEE shall develop a Trail Resting Area at the current terminus of the existing multi-use trail to include a hitching post, water trough and covered bench. The conceptual alignment of the trail extension is depicted on Exhibit "A." The final alignment of the extension and details of the Trail Resting Area shall be subject to LICENSOR's approval. LICENSEE shall also be responsible for providing LICENSOR approved equestrian fencing along the trail extension. All work shall be completed within ninety (90) days of the effective date of this Agreement. ii. For the term of this License, LICENSEE shall be responsible for the maintenance of the Trail Resting Area and that portion of the multi-use trail Page 3 of 10 732'749, from its current terminus at the southwest corner of the Property approximately ninety (90) feet east along the southerly border of the Property to the Crossing gate on APN 125-172-07. Such maintenance shall include all improvements constructed thereon in good order and repair, and to keep said premises`inmeat'' clean, orderly, safe, and sanitary condition, according to the City of San Juan Capistrano established standards. This includes, but is not limited to, the prevention of accumulation of any refuse or waste materials which might constitute a fire hazard or a public or private nuisance. iii. LICENSEE shall carry out the development and construction of the trail extension, Trail Resting Area, and fencing work in conformity with all applicable federal and state labor laws (including, without limitation, if applicable, the requirement under California law to pay prevailing wages). LICENSEE shall be solely responsible for determining and effectuating compliance with all applicable public works requirements, prevailing wage laws, and federal and state labor laws, and LICENSOR makes no representation as to the applicability or non-applicability of any of such laws to the work or any part thereof. LICENSEE hereby expressly acknowledges and agrees that the LICENSOR has not previously affirmatively represented to LICENSEE, in writing or otherwise, that such work is not a "public work," as defined in Section 1720 of.the Labor Code, LICENSEE hereby agrees that LICENSEE shall have the obligation to provide any and all disclosures or identifications required by Irabor.Code Section 1781, as the same may be amended from time to time pr any other similar law. LICENSEE shall indemnify, protect, defend and hold harmless LICENSOR and its respective officers, employees, contractors and agents, with counsel reasonably acceptable to LICENSOR, from and against any and all loss, liability, damage, claim, cost, expense and/or "increased costs" (including reasonable attorneys fees, court and litigation costs, and fees of expert witnesses) which, in connection with the work required pursuant to this Agreement, results or arises in any way from any of the following: (1) the noncompliance by LICENSEE of any applicable local, state and/or federal labor law (including, without limitation, if applicable, the requirement to pay State prevailing wages); (2) the implementation of Section 1781 of the Labor Cade, as the same may be amended from time to time, or any other similar law; and/or (3) failure by LICENSEE to provide any required disclosure or identification as required by Labor Code Section 1781, as the same may be amended from time to time, or any other similar law. It is agreed by the parties that, in connection with the work required pursuant to this Agreement, LICENSEE shall bear all risks of payment or non--payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar Naw "Increased costs,' as used in this section, shall have the meaning ascribe4 to it''in Labor Code Section 1781, as the same may be amended from time to time. The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the Page 4 of 10 732'749.1 construction of the trail extension, Trail Resting Area, and fencing by LICENSEE. (f) Liens . LICENSEE will fully and promptly pay for all materials joined or affixed to the Premises and/or APN 126-172-07 under the authority or direction of LICENSEE, and fully and promptly pay all persons who perform labor upon said property. Licensee shall not suffer or permit to be filed or enforced against the Premises and/or APN 125-172-07, or:any part thereof, any mechanics', materialmen's, contractors',.or subcontractors' liens or stop notices arising from, or any claim for damage growing out of, any testing, investigation, maintenance or construction work, or out of any other claim or demand of any kind. LICENSEE shall pay or cause to be paid all such liens, claims or demands, including sums due with respect to stop notices, together with attorney's fees incurred by LICENSOR with respect thereto, within ten (10) business days after notice thereof and shall indemnify, hold harmless and defend LICENSOR from all obligations and claims made against LICENSOR for the above described work, including attorney's fees. LICENSEE shall furnish evidence of payment upon request of LICENSOR. LICENSEE may contest any lien, claim or demand by furnishing a statutory lien bond or equivalent with respect to stop notices to LICENSOR in compliance with applicable California law. If LICENSEE does not discharge any mechanic's liens or stop notice for works performed for Licensee, LICENSOR shall have the right to discharge same (including by paying the claimant), and LICENSEE shall reimburse LICENSOR for the cost of such discharge within ten (10) business days after billing. The provisions of this subsection shall survive the termination of this Agreement. Section 4, No Assignments. LICENSEE may not assign, sublet or otherwise transfer its interest under this Agreement without the prior written consent of the LICENSOR. Any attempted assignment, sublet or transfer made in violation of this provision shall be null and void. Section 5. Water Power and Utilities. LICENSEE will be solely responsible for providing all water, electricity and other necessary utilities for the use and operation of the Premises. LICENSEE may use non-potable water from their own wells on the adjacent parcel, APNs 664-04- 107, 664-04-108, 664-04-109, and 664-04-110, as allowed by its owned water rights. Page 5 of 10 732749.1 Section 6. Time of the Essence. Time is of the essence of each and every provision, covenant, and condition herein contained and on the part of LICENSEE to be done and performed. Section 7. Site Modifications. Any modifications to the Premises, other than those specifically provided for in this Agreement will require prior approval of the San Juan Capistrano City Council. Additionally, any site modifications approved in concept by the City Council will be subject to all applicable City of San Juan Capistrano design guidelines and permitting processes. Section 8. Default. (a) If LICENSEE defaults in the payment of the license fee, or any additional applicable license payments, or defaults in the performance of any of the other covenants or conditions hereof, LICENSOR may give LICENSEE written notice of such default and if LICENSEE does not cure any such default within thirty (30) days, or such other time period as specified in the notice of default, after the giving of such notice, then LICENSOR may immediately terminate this License. The notice shall specify in reasonable detail the nature and extent of the default. If the nature of LICENSEE's obligation is such that more than thirty (30) days are required for performance, then LICENSEE shall not be deemed to be in default if it shall commence such performance within such thirty (30) day period and thereafter diligently prosecute the same to completion. If LICENSOR terminates the License pursuant to this Section, then, on the date specified in the notice of termination, the term of this License shall terminate, and LICENSEE shall then quit and surrender the Premises to LICENSOR, but LICENSEE shall remain liable as hereinafter provided. if this license shall have been so terminated by LICENSOR, LICENSOR may at any time thereafter resume possession of the Premises by any lawful means and remove LICENSEE or other occupants and their effects. (b) If LICENSEE breaches any covenant or condition of this license, LICENSOR may, on reasonable notice to LICENSEE.(.except that no notice need be given in case of emergency), cure such breach at the expense of LICENSEE. The reasonable amount of all expenses, including attorney's fees, incurred by LICENSOR in so doing shall be deemed additional fees payable on demand. Section 9. Termination Due to Bankruptcy or Insolvenc . In the event proceedings in bankruptcy are commenced by LICENSEE, or LICENSEE is found to be in a state of insolvency, then in such event, LICENSOR shall have the right to terminate this Agreement and all further rights and obligations thereunder, by ten (10) days' notice in writing to LICENSEE, in which event, on the expiration of the ten (10) days from mailing of the notice, this License shall automatically terminate. Page 6 of 10 732719,1 Section 10. E-Verify. If licensee is not already enrolled in the U.S. Department of Homeland Security's E-Verify program, Licensee shall enroll in the E-Verify program within thirty (30) days of the effective date of this Agreement to verify the employment authorization of new employees assigned to perform work hereunder. Licensee shall verify employment authorization within three days of hiring a new employee to perform work under this Agreement. Information pertaining to the E-Verify program can be found at httpJlwww.uscis.gov, or access the registration page at https://www.vis-- dhs.com/employerregistration. Licensee shall certify its registration with E-Verify. and provide its registration number within thirty (30) days of the effective date of this Agreement. Failure to provide certification will result in withholding payment until full compliance is demonstrated. Section 11. Notices. Any notice required to be given under this Agreement shall be in writing and shall be deemed to have been duly given and received if and when personally served, or forty-eight (48) hours after being deposited in the United States mail, first class, postage prepaid, addressed to the intended party at: LICENSOR: City of San Juan Capistrano City Manager 32400 Paseo Adelanto San Juan Capistrano, CA 92675 LICENSEE: Sheri L. Grady-Merkle, President and General Manager The Oaks Farms ("The Oaks") 31000 Avenida Siega San Juan Capistrano, CA 92675 Section 12. Attorneys' Fees. In the event any legal action or proceeding is commenced to interpret or enforce the terms of, or obligations arising out of this Agreement, or to recover damages for the breach thereof, the party prevailing in any such action or proceeding shall be entitled to recover from:the non-prevailing party all reasonable attorney's fees, costs and expenses incurred by the prevailing party. Page 7 of 10 732749,t Section 13. Surrender of Premises. LICENSEE shall, at the termination of this License, vacate the Premises in as good condition as they are in at the time of entry thereon by LICENSEE. Upon vacating, LICENSEE shall leave Premises free and clear of all rubbish and debris. Section 14, Insurance. LICENSEE shall Licensee shall: maintain at all times during the term of this Agreement comprehensive general liability and property damage insurance in the amount of not less than Two Million Dollars ($2,000,000) combined single limit. Said policy(ies) shall name LICENSOR, its officials, officers, employees, and agents as additional insured by endorsement to the policy and shall be in a form satisfactory to LICENSOR. LICENSEE will furnish LICENSOR with proof of insurance issued by an insurer approved by LICENSOR showing the coverage to be in force. LICENSEE's insurance coverage shall be primary coverage. LICENSOR and LICENSEE each waive the rights of subrogation that may arise against the other because of any act covered by insurance. The policy shall provide that modification or cancellation of the policy shall not occur without thirty (30) days advance written notice provided by the insurer to LICENSOR. Other terms and conditions, including cancellation provisions and endorsement forms, shall be reviewed and approved by the Office of the City Attorney. Section 16. Indemnity, Each party shall indemnify and save harmless the other, its successors and assigns together with its officials, officers, directors, employees, agents and those for whom it is in law responsible,,from.and against any and all liabilities, damages, causes of action, claims; suits, proceedings, judgments, costs, expenses, including legal costs and attorney's fees, for death or injury to persons or damage to property or the Premises, which each party may incur or suffer or be put to by reason of or in connection with or arising from the other party's use of the Premises, any breach, violation or nonperformance by the other of any obligation contained in this Agreement to be observed or performed by the respective party, or any wrongful act or negligence of the respective party or its agents or employees which relates to this Agreement, howsoever arising. Each party acknowledges and agrees that the foregoing mutual indemnity obligation shall survive any termination of this Agreement. Section 16, Taxes. Pursuant to Revenue & Taxation Code §107.7, the property interest created herein may be subject to property taxation and LICENSEE may be subject to property taxes levied on such interest. In no event shall LICENSOR be liable for any taxes owed as a result of this License or LICENSEE's use of the Premises. Page 8of10 7327491 Section 17. No Relocation Benefits. This Agreement is not intended to convey a property interest but to permit LICENSEE to use the Premises as provided for herein. LICENSEE acknowledges the rights granted by State and/or Federal Relocation Assistance Laws and regulations and, notwithstanding any other provision of this Agreement, expressly waives all such past, present and future rights, if any, to which LICENSEE might otherwise be entitled from LICENSOR with regard to this License Agreement and the business operated on the Premises. LICENSEE shall not be entitled to relocation assistance, relocation benefits, or compensation for loss of goodwill upon the termination of this Agreement. Section 18. Entire Agreement. The terms in this Agreement constitutes the entire understanding and agreement between the Parties and supersedes all previous negotiations between them pertaining to the subject matter thereof. Section 19: Termination of Past Leases Licenses and Agreements. This License and the terms and conditions hereof supersede and shall terminate the Oaks Paddock Lease and any other leases, licenses, agreements or understandings pertaining to the subject matter hereof. [SIGNATURE PAGE FOLLOWS] Page 9of10 732744.1 IN WITNESS WHEREOF, LICENSOR and LICENSEE have caused this License Agreement to be executed on the date and year first written above. LICENSEE: THE OAKS, INC., a Delaware corporation, doing business in ;Caforni 61ciFarms y- le, President/Gene I Manager LICENSOR: CITY OF N4UA ..°CAPISTRANO, A Califor is municip I coloration Ir f By. Dr. Londres Uso, Mayor ATTEST Maria orr s Pity Cler APPROVED AS TO FOR . 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