HomeMy WebLinkAbout05-22-2019 Steering Committee Meeting ONLINE Agenda.pdf Orange County Sanitation District Wednesday, May 22, 2019
Regular Meeting of the 5:00 P.M.
STEERING COMMITTEE Administration Building
Conference Rooms A& B
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
AGENDA
CALL TO ORDER
DECLARATION OF QUORUM: Clerk of the Board
PUBLIC COMMENTS: If you wish to address the Committee on any item, please complete a
Speaker's Form (located at the table at the back of the room) and submit it to the Clerk of the Board or
notify the Clerk of the Board the item number on which you want to speak. Speakers will be recognized by
the Chairperson and are requested to limit comments to three minutes.
REPORTS: The Committee Chairperson and the General Manager may present verbal reports on
miscellaneous matters of general interest to the Directors. These reports are for information only and
require no action by the Directors.
CONSENT CALENDAR: The Consent Calendar Items are considered to be routine and will be
enacted, by the Committee, after one motion, without discussion. Any items withdrawn from the Consent
Calendar forseparate discussion will be considered in the regular order of business.
1. APPROVAL OF MINUTES (Clerk of the Board)
RECOMMENDATION: Approve Minutes of the Regular Meeting of the Steering
Committee held April 24, 2019.
2. PROPERTY MANAGEMENT SERVICES FOR 18350 MT. LANGLEY STREET,
18429 PACIFIC STREET, 18368-18375 AND 18410-18436 BANDILIER CIRCLE,
FOUNTAIN VALLEY (Lorenzo Tyner)
RECOMMENDATION: Recommend to the Board of Directors to: Approve
Amendment No. 3 with The Muller Company for Property Management Services to
extend the services for twelve-months, from September 1, 2019 through
August 31, 2020, with all terms and provisions of the Agreement remaining
unmodified and in full force and effect.
NON-CONSENT ITEMS:
None.
051=019 Steering Commiffee Agenda Page 1 of
INFORMATION ITEMS:
None.
CLOSED SESSION:
During the course of conducting the business set forth on this agenda as a regular meeting of the Board,
the Chairperson may convene the Board in closed session to consider matters of pending real estate
negotiations,pending or potentiallitigation,or personnel matters,pursuant to Government Code Sections
54956.8, 54956.9, 54957 or 54957.6, as noted.
Reports relating to (a)purchase and sale of real property; (b) matters of pending or potential litigation;
(c) employment actions or negotiations with employee representatives;or which are exempt from public
disclosure under the California Public Records Act, may be reviewed by the Board during a permitted
closed session and are not available for public inspection. At such time as the Board takes final action
on any of these subjects, the minutes will reflect all required disclosures of information.
CONVENE IN CLOSED SESSION.
(1) CONFER WITH LABOR NEGOTIATORS
(Government Code Section 54957.6)
Agency Designated Representatives: Laura Kalty, Liebert Cassidy Whitmore; James
Herberg; Lorenzo Tyner; and Celia Chandler.
Employee Organizations: 3
• International Union of Operating Engineers, Local 501; Orange County
Employees Association; and the Supervisors and Professionals Group.
(2) CONFERENCE WITH LEGAL COUNSEL RE EXISTING LITIGATION
(Government Code Section 54956.9(d)(1))
Number of Cases: 1
Klean Waters, Inc. et al. v. Orange County Sanitation District, et al., United States
District Court, Central District of California, Southern Division, Case
No. 8:15-cv-00627.
(3) CONFERENCE WITH REAL PROPERTY NEGOTIATORS
(Government Code Section 54956.8)
Properties and Negotiating Parties:
De La Rosa Maintenance. 18368 Bandilier Cir.
Contractors, Inc Fountain Valley, CA APN No. 156-163-11
Gigamem, LLC 18375 Bandilier Cir.
Fountain Valley, CA APN No. 156-163-11
Thuan Nguyen 18381 Bandilier Cir.
Fountain Valley, CA APN No. 156-163-11
05/22/2019 Steenng Committee Agenda Page 2 of 4
Uber Chic Home, LLC 18384 Bandilier Cir.
Fountain Valley, CA APN No. 156-163-11
Deborah Muccillo 18436 Bandilier Cir.
dba Interiors Within Reach Fountain Valley, CA APN No. 156-163-10
Leadingware Group, Inc. 18430 Bandilier Cir.
Fountain Valley, CA APN No. 156-163-10
Car Prep Inc. 18429 Pacific Street
Fountain Valley, CA APN No. 156-163-09
Agency negotiators: James Herberg, Rob Thompson, Lorenzo Tyner
Under negotiation: Price and terms of lease renegotiations
RECONVENE IN REGULAR SESSION.
CONSIDERATION OF ACTION, IF ANY, ON MATTERS CONSIDERED IN CLOSED
SESSION:
OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY:
BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING:
At this time Board members may request staff to place an item on a future agenda.
ADJOURNMENT:
To the Steering Committee meeting scheduled for Wednesday, June 26, 2019 at
5:00 P.M.
05/22/2019 Steenng Comminee Agenda Page 3 of 4
Accommodations for the Disabled: Meeting Rooms are wheelchair accessible. If you require any special disability
related accommodations, please contact the Orange County Sanitation District Clerk of the Board's office at
(714)593-7433 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and
the type of accommodation requested.
Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2, this agenda
has been posted outside the main gate of the Sanitation District's Administration Building located at 10844 Ellis Avenue,
Fountain Valley,California,and on the Sanitation District's website at www.ocsd.com not less than 72 hours prior to the
meeting date and time above. All public records relating to each agenda item, including any public records distributed
less than 72 hours prior to the meeting to all, or a majority of the Board of Directors,are available for public inspection
in the office of the Clerk of the Board.
Agenda Description: The agenda provides a brief general description of each item of business to be considered or
discussed. The recommended action does not indicate what action will be taken. The Board of Directors may take any
action which is deemed appropriate.
NOTICE TO DIRECTORS: To place items on the agenda for a Committee or Board Meeting, items must be submitted
to the Clerk of the Board 14 days before the meeting.
Kelly A.Lore,MMC
Clerk of the Board
(714)593-7433
klore(ftasd.com
For any questions on the agenda, Committee members may contact staff at:
General Manager Jim Herberg (714)593-7300 iherberg(o)ocsd.com
Assistant General Manager Lorenzo Tyner (714)593-7550 INner(c3ocsd.com
Assistant General Manager Rob Thompson (714)593-7310 rthomosonaocsd.com
Director of Human Resources Celia Chandler (714)593-7202 cchandleNbiocsd.com
Director of Engineering Kathy Millea (714)593-7365 kmillea6focsd.com
Director of Environmental Services Lan Wibo 714 593-7450 Iwibo gced.com
051=2019 Steering Committee Agenda Page 4 of 4
ITEM NO. 1
MINUTES OF THE
STEERING COMMITTEE
Orange County Sanitation District
Wednesday, April 24, 2019 at 5:00 p.m.
A regular meeting of the Steering Committee of the Orange County Sanitation
District was called to order by Board Chairman David Shawver on Wednesday,
April 24, 2019 at 5:03 p.m. in the Administration Building of the Orange County
Sanitation District.
A quorum was declared present, as follows:
COMMITTEE MEMBERS PRESENT: STAFF PRESENT:
David Shawver, Board Chair Jim Herberg, General Manager
John Withers, Board Vice-Chair Rob Thompson, Assistant General
Robert Collacott, Operations Committee Manager
Chair Lorenzo Tyner, Assistant General
Peter Kim, La PA Committee Chair Manager
Glenn Parker, Member-At-Large Celia Chandler, Director of Human
Chad Wanke, Administration Committee Resources
Chair Mike Dorman, Engineering Manager
Kelly Lore, Clerk of the Board
COMMITTEE MEMBERS ABSENT: Stephanie Barron
Tim Shaw, Member-At-Large Jennifer Cabral
Rod Collins
Thys DeVries
Dean Fisher
Al Garcia
Tina Knapp
Laura Maravilla
Andrew Nau
Adam Nazaroff
Tyler Ramirez
Wally Ritchie
OTHERS PRESENT:
Brad Hogin, General Counsel
Laura Kalty, Liebert Cassidy Whitmore,
Special Counsel
PUBLIC COMMENTS:
No public comments were provided.
04/24/2019 Steering Committee Minutes Page 1 of 4
REPORTS:
Chair Shawver did not provide a report.
General Manager Jim Herberg did not provide a report.
CONSENT CALENDAR:
1. APPROVAL OF MINUTES (Clerk of the Board)
MOVED, SECONDED, AND DULY CARRIED TO: Approve Minutes of the
Regular Meeting of the Steering Committee held March 27, 2019.
AYES: Collacott, Kim, Parker, Shawver, Wanke and Withers
NOES: None
ABSTENTIONS: None
ABSENT: Shaw
NON-CONSENT ITEMS
2. SELECTION OF 2019 HONOR WALK RECIPIENTS (Jim Herberg)
Mr. Herberg presented a brief overview of the program and the method for
selection of honorees.
MOVED. SECONDED, AND DULY CARRIED TO: Approve nominated former
employees Chris Cervellone and Ingrid Hellebrand as Honor Walk brick
recipients for the year 2019.
AYES: Collacott, Kim, Parker, Shawver, Wanke and Withers
NOES: None
ABSTENTIONS: None
ABSENT: Shaw
3. NEWHOPE-PLACENTIA TRUNK REPLACEMENT, PROJECT NO. 2-72
(Kathy Millea)
Assistant General Manager Rob Thompson provided a brief presentation
regarding the item.
MOVED. SECONDED, AND DULY CARRIED TO: Recommend to the Board
of Directors to:
A. Adopt Resolution No. OCSD 19-XX entitled, "A Resolution of the Board
of Directors of Orange Sanitation District Amending the Proposition 84
Integrated Regional Water Management Program 2015 Implementation
Grant Funding Contract for Newhope-Placentia Trunk Sewer
Replacement Project 2-72, and Repealing Resolution No.
04/24/2019 Steering Committee Minutes Page 2 of 4
OCSD 16-20"; and
B. Approve Amendment No. 1 to the Contract between the Orange County
Sanitation District and the Santa Ana Watershed Project Authority
(SAWPA) to allow the Newhope-Placentia Trunk Replacement, Project
No. 2-72, to receive Proposition 84 related grant funds up to$1,000,000.
AYES: Collacett, Kim, Parker, Shawver, Wanke and Withers
NOES: None
ABSTENTIONS: None
ABSENT: Shaw
INFORMATION ITEMS:
4. STRATEGIC PLAN DEVELOPMENT PROCESS AND TIMELINE
(Rob Thompson)
Mr. Thompson provided an overview of the process and development of the
upcoming Strategic Plan, listed the policy goals focusing on broad policy
statements and provided a proposed schedule. Mr. Herberg added that staff
requests the feedback of the Directors. A brief discussion took place.
CLOSED SESSION
Board Chairman Shawver stated that a supplemental item was added to the Closed
Session.
CONVENED IN CLOSED SESSION PURSUANT TO GOVERNMENT CODE
SECTION 54957.6 & 54956.9(d)(1):
The Board convened in closed session at 5:26 p.m. to discuss two items. Confidential
minutes of the Closed Session have been prepared in accordance with the above
Government Code Sections and are maintained by the Clerk of the Board in the
Official Book of Confidential Minutes of Board and Committee Closed Session
Meetings.
RECONVENED IN REGULAR SESSION:
The Board reconvened in regular session at 5:55 p.m.
CONSIDERATION OF ACTION, IF ANY, ON MATTERS CONSIDERED IN CLOSED
SESSION:
General Counsel Brad Hogin did not provide a report.
OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA
ITEMS, IF ANY:
None.
04/24/2019 Steering Committee Minutes Page 3 of 4
BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING:
None.
ADJOURNMENT:
Chair Shawver declared the meeting adjourned at 5:56 p.m. to the next Steering
Committee meeting to be held on Wednesday, May 22, 2019 at 5:00 p.m.
Submitted by:
Kelly A. Lore, MMC
Clerk of the Board
04/24/2019 Steering Committee Minutes Page 4 of 4
STEERING COMMITTEE Meeting Date TOBE.Or Dir.
05/22/19 05/22/19
AGENDA REPORT ItemNumber Item Number
z
Orange County Sanitation District
FROM: James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT: PROPERTY MANAGEMENT SERVICES FOR 18350 MT. LANGLEY
STREET, 18429 PACIFIC STREET, 18368-18375 AND 18410-18436
BANDILIER CIRCLE, FOUNTAIN VALLEY
GENERAL MANAGER'S RECOMMENDATION
Approve Amendment No. 3 with The Muller Company, LLC for Property Management
Services to extend the services for twelve-months, from September 1, 2019 through
August 31, 2020, with all terms and provisions of the Agreement remaining unmodified
and in full force and effect.
BACKGROUND
In March 2018, the Orange County Sanitation District (Sanitation District) purchased
property at 18350 Mt. Langley Street in Fountain Valley. The property was occupied by
commercial tenants and was managed by The Muller Company, LLC, a professional
property management company. The Sanitation District contracted with The Muller
Company to continue to provide professional property management services to maintain
the building and interact with the commercial tenants.
In August 2018, the District acquired three additional parcels on Pacific Street and
Bandilier Circle; each building with multiple commercial leases. The Muller Company
agreement was amended to include the management of these three buildings in addition
to the Mt. Langley building.
RELEVANT STANDARDS
Protect Orange County Sanitation District assets
PROBLEM
The Sanitation District will need to transition these properties from commercially leased
to construction ready. This transition process is expected to commence prior to the
expiration of the current term of the property management services agreement and
continue through Summer 2020.
PROPOSED SOLUTION
Continue to engage the firm currently managing the properties through the transition
process in preparation of the construction of the new Administration Building and until a
Page 1 d 3
permanent property management strategy can be developed for the one remaining
commercially leased building.
TIMING CONCERNS
The current schedule calls for the transition to commence prior to the expiration of the
current property management agreement and for the transition to be complete before
Fall 2020.
RAMIFICATIONS OF NOT TAKING ACTION
The Sanitation District will lose continuity of care of the property and could incur potential
delays while transitioning from commercially leased to construction ready, thus delaying
the construction timeline for the new Administration Building.
PRIOR COMMITTEE/BOARD ACTIONS
September 2018 - Approved Amendment No. 1 with The Muller Company for Property
Management Services for an additional management fee of$3,293 per month plus other
incurred expenses, for the addition of Sanitation District acquired properties on Bandilier
Circle and Pacific Street including two additional renewal periods of six months each.
February 2018 - Approved a sole source agreement with The Muller Company for
Property Management Services, for the period March 1, 2018 through August 31, 2018,
for a management fee of $4,200 per month plus other incurred expenses, including two
additional renewal periods of six months each.
September 2017 - Approved a Standard Offer, Agreement and Escrow Instructions for
and Authorized General Manager and General Counsel to Execute any and all
Instruments Related to the Transaction of Purchase of Real Estate (Purchase Agreement)
with K&A Investments LP for Property at 18350 Mt. Langley Street, Fountain Valley.
ADDITIONAL INFORMATION
Monthly expenses for services such as utility bills and repair work will vary month to
month. All expenses will be reviewed and approved by Sanitation District staff.
CEQA
N/A
FINANCIAL CONSIDERATIONS
The property management costs will be offset by rents collected on the commercial
leases.
Page 2 of 3
ATTACHMENT
The following attachment(s)in attached in hard copy and may also be viewed on-line at the OCSD website
(www.ocsd.corn with the complete agenda package:
• Proposed Amendment No. 3
Original Agreement
• Amendment No. 1
• Amendment No. 2
Page 3 d 3
AMENDMENT NO.3 TO MANAGEMENT AGREEMENT
This AMENDMENT NO. 3 TO MANAGEMENT AGREEMENT("Amendment') is made and entered
into effective as of May_2019, by and between ORANGE COUNTY SANITATION DISTRICT, a county
sanitation district duly organized and existing pursuant to Section 4700 et. seq. of the Health & Safety Code of
the State of California("Owner'),and THE MULLER COMPANY,LLC ("Manager").
RECITALS :
A. Owner and Manager entered into that certain Management Agreement dated as of February 28,
2018, Amendment No 1 dated August 28,2018 and Amendment No 2 dated February 28,2019(collectively the
"Agreement") pursuant to which Owner contracted with Manager to provide management services fmI8350
Mount Langley, Fountain Valley, California, the 'Property" and to provide management services for 18368,
18375, 18381, 18384, 18410, 18430, 18436 Bandilier Circle and 18429 Pacific Street,Fountain Valley,California,
the"Additional Properties".
B. Except as otherwise set forth herein,all capitalized terms used in this Amendment shall have the
same meaning given such terms in the Agreement.
C. Owner and Manager desire to amend the Agreement to change the Expiration Date,as hereinafter
provided.
NOW, THEREFORE, in consideration of the Foregoing Recitals and the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged,the parties hereto agree as follows:
1. Parties agree to renew the Agreement for a twelve(12)month tern from September 1,2019
through August 31,2020("Expiration Date").
2. No Further Modification. Except as set forth in this Amendment No. 3, all of the terns and
provisions of the Agreement shall remain unmodified and in full force and effect.
IN WITNESS WHEREOF,this Amendment has been executed as of the day and year first above written.
(Signatures on next page)
ORANGE COUNTY SANITATION
DISTRICT
Dated: By:
David John Shawver, Chair, Board of
Directors
Dated: By:
Kelly A. Lore, Clerk of the Board
Dated: By:
Lorenzo Tyner, Contracts, Purchasing and
Materials Manager
THE MULLER COMPANY, LLC
Dated: By:
Jon M. Muller President
Print Name and Title of Officer
IRS Employer's I.D. Number
-2-
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (this "Agreement") is made and entered into as of
February 28, 2018 by and between ORANGE COUNTY SANITATION DISTRICT, a county
sanitation district duty organized and existing pursuant to Section 4700 et. seq. of the Health &
Safety Code of the State of California (hereinafter called "Owner"), and THE MULLER
COMPANY, a California corporation (hereinafter called "Manager').
WITNESSETH
WHEREAS, Owner is the owner of that certain real property addressed as 18350 Mt
Langley, Fountain Valley, California, commonly known as Fountain Valley Business Center, (the
"Property");
WHEREAS, the Property includes an office building and surface parking; and
WHEREAS, Owner desires to appoint Manager to manage and operate the Property and
Manager desires to accept such appointment, all upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, for and in consideration of the promises and mutual covenants and
agreements contained in this Agreement and the fees to be paid under this Agreement, Owner
and Manager hereby agree as follows:
ARTICLE I
Establishment of Hiring; Term
1.1 Exclusive Hiring. Owner hereby appoints Manager, in the capacity of an
independent contractor, as the sole and exclusive manager for the Property, and Manager
hereby accepts such appointment. This Agreement is not one of agency by manager for owner,
but one with Manager engaged with respect to the functions undertaken by or assigned to
Manager under this Agreement independently in the business of managing properties on its own
behalf, as an independent contractor.
1.2 Term of Agreement. The term of this Agreement will be for an initial term of
six (6) months and two renew Options with six (6) month term each to be exercised at the
discretion of the Owner upon written notice by Owner of renewal at least thirty (30) days prior
to the end of the Initial Term. Notwithstanding the foregoing: (i) if Manager defaults in the
performance of any of Managers obligation under this Agreement, and such default is not cured
within thirty (30) days after written notice thereof is received by Manager (or, if such default is
non-monetary and of such a nature that it cannot be reasonably cured within such 30-day
period, Manager fails to commence the curing of such default within such 30-day period and
fails to thereafter diligently prosecute such cure to completion), then Owner may thereupon
terminate this Agreement for cause by giving written notice of such termination to Manager,
such termination to be effective as of the effective date specified in such termination notice; and
U2502709 2 00nsaivdlwde -1-
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III) Manager may terminate this Agreement at any time with or without cause by giving Owner at
least thirty (30) days' prior written notice. The Initial Term shall commence once Owner obtains
legal title to the Property.
1.3 Furthermore, Owner reserves the right to terminate this Agreement for its
convenience, with or without cause, in whole or in part, by giving at least thirty (30) day's prior
written notice to the Manager.
1.4 Cooperation. Owner and Manager shall consult and meet with each other to
the extent necessary or appropriate to enable Manager to perform its duties under this
Agreement or as requested by either party. Each parry shall cooperate fully in all matters
relating to the management, operation, maintenance and repair of the Property and the defense
of any claim, action or proceeding relating thereto or to this Agreement, and both parties shall
promptly respond to all requests for information by the other party, including furnishing all
documents and services relating thereto required by Owner in connection with the operation of
the Property. Any time the consent of Manager or Owner is required under this Agreement,
such consent shall not be unreasonably withheld, conditioned or delayed, and whenever this
Agreement grants Manager or Owner the right to take action, exercise discretion or make a
determination, Manager and Owner shall act reasonably and in good faith unless a different
standard is expressly set forth in this Agreement.
ARTICLE II
Services to be Performed by Manager
2.1 Employment of Personnel. Manager shall employ such personnel as may be
necessary, in Manager's sole but good faith discretion, for Manager to (i) accomplish the
efficient and successful operation and management of the Property, and (ii) property perform
Manager's obligations under this Agreement, which may include, without limitation, employing
one (1) or more on-site managers. Such personnel shall in every instance be deemed
employees of Manager and not of Owner, and Owner shall have no right to supervise or direct
any of such employees. Manager shall fully comply with all applicable laws and regulations
having to do with workers' compensation, social security, unemployment insurance, hours of
labor, wages, working conditions and other employer-employee related subjects in connection
with the Property. All reasonable salaries, wages, and other compensation of personnel
employed by Manager under this Agreement, including so-called fringe benefits (but excluding
bonuses), medical and health insurance, federal and state unemployment taxes, pension plans,
social security taxes, workmen's compensation insurance and the like shall be paid by Manager
and reimbursed to Manager by Owner on a pro rate basis of the time such employee has
allocated to the Property and where such employee services were required to properly,
adequately, safely and economically manage, operate, and maintain the Property, and provided
that such employees have been identified by position and compensation enumerated on a
schedule provided to Owner by Manager and approved by Owner, or as set forth in the
Approved Budget(as defined below).
2.2 Service Contracts. Manager shall make in Manager's name as agent for
Owner, contracts for utilities and other services such as water, electricity, gas, telephone,
vermin extermination, trash removal, heating, ventilating, and air conditioning maintenance,
security, and other services deemed by Manager or Owner to be necessary or advisable for the
operation, maintenance, or repair of the Property in accordance with this Agreement. All such
contracts shall (i) be in the name of the Manager as agent for owner; (ii) be made expressly
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assignable, at Owner's option, to Owner or Owners nominee, (iii) include a provision for
cancellation thereof by Owner or Manager effective upon 30 days' written notice; and (iv) shall
provide all contractors provide evidence of adequate and sufficient insurance for the services
being proved. Manager shall also place orders in Managers name as agent for Owner for such
equipment, tools, appliances, materials, and supplies as are reasonable and necessary, in
Managers sole but good faith discretion, to property maintain, manage, operate, or repair the
Property in accordance with this Agreement. In entering into any contracts contemplated by this
Agreement, Manager shall use commercially reasonable efforts to include as a condition thereof
the right of Owner or Manager, as the case may be, to terminate such contract on thirty (30)
days' prior written notice. Manager may obtain goods or services for the Property from direct or
indirect affiliates of Manager, its officers, directors, shareholders, or employees (collectively,
"Manager Affiliated Parties'), but only if such goods and services are of at least equal quality
and of no higher prices than comparable goods and services obtainable from unaffiliated parties
and such goods and services are otherwise competitive with comparable goods and services
and Owner provides written consent of such contacts with Manager Affiliated Parties and after
disclosing to Owner the relationship of Manager to the Manager Affiliated Parties.
2.3 Contracts in excess of$5,000.00 shall be procured as follows:
(a) For contracts for goods and services with the value $50,000 or less
Manager shall obtain three competitive Bids or Proposals as applicable.
(b) For construction contracts with value equal or greater than $35,000 all
contracts must be competitively bid and the award provided to the lowest,
responsive, responsible Bidder.
(c) Sole Source contracts may be initiated provided that the following
conditions are met:
1. Goods or Services are of a unique nature based on their quality,
durability, availability, fitness or qualifications for a particular use; or only
available from one source. Written justification must be provided to Owner
for approval prior to proceeding with the sole source contract
Owner approval must be obtained by Manager prior to proceeding with all new
contracts.
2.4 Maintenance and Repair of Property. To the extent funds of Owner are
available, Manager shall make all repairs and perform all maintenance on the buildings, grounds
and other improvements of the Property necessary, in Managers sole but good faith discretion,
to maintain the Property in a manner comparable to similar office buildings in the vicinity of the
Property, but only to the extent the cost of such work does not exceed $5,000.00; otherwise,
prior written approval from Owner shall be required. Notwithstanding the foregoing, Manager
shall also perform or furnish any and all emergency repairs or services necessary, in Managers
sole but good faith discretion, for the preservation of the Property or to avoid the suspension of
any service to the Property or danger to life or property. Emergency repairs or services may be
made or furnished by Manager without Owners prior written approval, but only if it is not
reasonably feasible to secure such prior approval. In any event, with respect to any emergency
repair or service which costs more than $5,000.00, only, Manager shall, not later than two (2)
business days after performing or furnishing such emergency repair or service, notify Owner of
the details and cost thereof.
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23'r99s OW72 sIv®vdea 3-
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2.5 Tenant Relations. Manager shall use commercially reasonable efforts to
make itself fully familiar with the terms and provisions of all leases for space within the Property,
and to the extent funds are available shall use commercially reasonable efforts to perform all
delegable duties of Owner as landlord under each such lease, so that such lease shall remain in
full force and effect, with no default by Owner, and shall use commercially reasonable efforts to
enforce the full performance of all obligations of the tenant under each such lease (including,
without limitation, the tenant's obligation to deliver estoppel certificates, subordination and
attommenl agreements, financial statements and other documents required under such lease).
Manager shall maintain business-like relations with tenants, receive requests, complaints and
the like, from tenants and shall use reasonable efforts to respond and act upon the foregoing in
reasonable fashion.
2.6 Collection of Moneys. Manager shall use commercially reasonable efforts to
collect all rent and other charges due from tenants, licensees and other occupants of the
Property and such other rents and charges as shall otherwise be due to Owner in connection
with Owners ownership of the Property. Owner authorizes Manager to request, demand,
collect, receive and deposit all such rent and other charges and to institute proceedings in the
name of, and as an expense reimbursable by, Owner for the collection thereof and for the
dispossession of tenants and other persons from the Property, and such expense may include
the engaging of counsel for any such matter. However, no unlawful detainer action shall be filed
by Manager without prior written approval of Owner. In connection with any of the foregoing,
Manager may settle, compromise, or release any action, claim, or demand of Owner, provided
that Owners prior written consent shall be required for the settlement, compromise, or release
of any claim for which the amount at issue exceeds $5,000.00. All moneys collected by
Manager shall be forthwith deposited in the Operating Account(as defined below).
2.7 Compliance with Leoal Requirements. Manager shall use commercially
reasonable efforts to comply with any and all laws, ordinances, rules, regulations, orders, or
other requirements affecting the Property of any federal, state, county, or municipal authority
having jurisdiction thereover, and orders of the Board of Fire Underwriters or other similar
bodies. Manager, however, shall not take any such action as long as Owner is contesting, or
has affirmed in writing to Manager its intention to contest and promptly institutes proceedings
contesting, any such order or requirement, except that if failure to comply promptly with any
such order or requirement would or could expose Manager to criminal liability, Manager shall
have the right, but not the obligation, to cause compliance with such order or requirement.
However, before any election by Manager to comply with such order or requirement, Manager
shall provide Owner written notice of its intent to do so and Owner or Manager shall have the
right to immediately terminate this Agreement. Owner agrees to pay all expenses incurred by
Manager, including, without limitation, reasonable attorneys' fees for counsel (not exceeding a
rate of $250 per hour) employed to represent Manager or Owner, with respect to any
proceeding or suit involving an alleged violation by Manager or Owner, or both, of any orders or
requirements of any federal, state, county, or municipal authority or orders of the Board of Fire
Underwriters or other similar bodies (unless Manager is finally adjudicated to have personally
and not in a representative capacity violated such order or requirement), but nothing contained
herein shall require Manager to employ counsel to represent Owner in any such proceeding or
suit.
2.6 Construction Management and Supervision. Manager shall provide the "CM
Services" set forth in Exhibit attached hereto and made a part of this Agreement.
67£508 03"
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2.9 Leasing Services. Manager shall endeavor to secure and retain tenants for
the Property. All leasing activity, whether for retention of existing tenants or obtaining of new
tenants, shall be conducted in accordance with the Approved Budget(as defined below) and the
applicable terms and conditions set forth in this Agreement. Manager agrees to cooperate with
any third party brokers ("Outside Brokers") in leasing space at the Property; leasing
commissions to such Outside Brokers shall be paid by Manager (following payment of same by
Owner to Manager) with respect to leases hereunder; if such leasing commission to be paid to
an Outside Broker is set forth in the Approved Budget, then such leasing commission shall not
require the approval of Owner (otherwise such leasing commission shall require Owner's prior
written approval).
2.10 Notices. Manager shall promptly deliver to Owner all notices received from
any mortgagee, trustee, ground lessor, governmental or official entity, or any other parry with
respect to the Property. Manager may sign and serve in the name of Owner any and all notices
only required in connection with the proper performance by Manager of the services required to
be performed by Manager under this Agreement.
ARTICLE III
Budgets/Reports
3.1 Process for Approval of Annual Operating Budget. Within thirty (30) days
after the commencement of the Initial Term of this Agreement, Manager shall submit to Owner,
for Owner's approval (which approval shall not be unreasonably withheld, conditioned or
delayed), a current operating budget for the Property from the date of the commencement of the
initial Term of this Agreement through June 30, 2018, which proposed budget shall reflect
thereon projections of all receipts and operating costs and expenses, capital expenditures, and
replacement reserves that Manager, in the exercise of good business judgment, believes will be
received or necessary to be incurred, as the case may be, to operate the Property through June
30, 2018.
3.2 Within sixty days from the initial Term of this Agreement, Manager shall
submit to Owner for Owner's approval (which approval shall not be unreasonably withheld,
conditioned or delayed) a proposed operating budget for the Property for the fiscal year of July
1, 2018 through June 30, 2019. Such proposed budgets and projections shall be submitted by
Manager solely as estimates, without warranty of their accuracy or attainability. Manager may
not employ any person, to assist Manager with the preparation of such budget. If Manager has
not received written approval or disapproval of Managers proposed operating budget within
thirty(30) days after submittal thereof by Manager, the proposed operating budget submitted by
Manager shall be automatically deemed approved by Owner. If written disapprovals are
received by Manager, Manager shall promptly revise the proposed operation budget to
incorporate any comments thereto proposed by Owner with which Manager agrees and the
parties shall consult with each other in order to mutually agree upon an acceptable final
operating budget. The approved and/or deemed approved operating budget shall be referred to
herein as the "Approved Budget". If, as of July 1 of each fiscal year, a proposed operating
budget has not yet been finalized, then Owner and Manager shall continue to proceed under the
prior fiscal years Approved Budget until the current fiscal years operating budget is agreed
upon by Owner and Manager, except that all ordinary reimbursable expenses included in such
prior years Approved Budget (other than taxes, insurance and utilities, which shall be at the
actual costs thereof) shall be increased by five percent (5%). If an Approved Budget has not
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been agreed upon by March 31st then ether party upon 30-days' written notice may terminate
this Agreement.
3.3 Expenditures and Liabilities Which Are in Addition to Items on the Approved
Budget. Manager shall secure the written approval of Owner (which approval shall be in the
sole discretion of Owner) prior to making any expenditure or incurring any liability or obligation
not reflected on the Approved Budget; provided, however, that Manager shall not be required to
secure the written approval of Owner if such expenditure does not increase any line item by
more than five percent(5%) of the line item amount reflected on the Approved Budget.
3.4 Records: Reporting and Audit.
(a) Records. All statements, receipts, invoices, checks, leases, contracts,
worksheets, financial statements, books and records, and all other instruments and
documents relating to or arising from the operating or management of the Property
shall be maintained by Manager, and Owner and Manager shall have the right to
inspect and to copy all such items, at such party's expense, at all reasonable times,
and from time to time, during the term of this Agreement and for a reasonable time
thereafter not to exceed three(3)years. Upon the termination of this Agreement, all
of such books, records and other information shall be the property of and be
promptly delivered (without warranty) to Owner in readily accessible and readable
form; provided, however, that Manager or its representatives shall have the right to
inspect such books, records, and other information and to make copies thereof
during the three (3) year period referred to in the preceding sentence at the offices
of Owner upon reasonable advance notice to Owner.
(b) Monthly Reports. On or before the twentieth (20'h) day of each month
during the term of this Agreement, Manager shall deliver to Owner an operating
report for the Property (on a cash and not an accrual method) for the preceding
calendar month.
(c) Audit. Owner retains the reasonable right to access, review, examine,
and audit, any and all books, records, documents and any other evidence of
procedures and practices that Owner determines are necessary to discover and
verify that Manager is in compliance with all requirements under this Agreement.
Manager shall include the SANITATION DISTRICT'S right as described above, in
any and all of their subcontracts, and shall ensure that these rights are binding upon
all Subconsultants.
Owner retains the right to examine Manager's books, records, documents and any
other evidence of procedures and practices that the Owner determines are
necessary to discover and verify all costs, of whatever nature, which are claimed to
have been incurred, or anticipated to be incurred or to ensure CONSULTANT's
compliance with all requirements under this Agreement during the term of this
Agreement and for a period of three (3)years after its termination.
Manager shall maintain complete and accurate records in accordance with
generally accepted industry standard practices and the Owners policy. Manager
shall make available to Owner for review and audit, all property related accounting
records and documents, and any other financial data within 15 days after receipt of
notice from Owner. Upon Owners request, Manager shall submit exact duplicates
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of originals of all requested records to Owner. If an audit is performed, Manager
shall ensure that a qualified employee of the Manager will be available to assist
Owners auditor in obtaining all accounting records and documents, and any other
financial data as they relate to the property and services provided under this
Agreement.
(d) No Liability for Returns Required by Law. Manager shall not be
responsible or liable for preparing or fling any forms, reports, or returns that may be
required by law relating to any personnel employed by Owner in connection
therewith. Manager, and not Owner, however, shall be responsible for any forms,
reports, or returns that may be required by law relating to any of Managers
employees.
ARTICLE IV
Expenses, Operating Account
4.1 Expense of Owner. Everything done by Manager under the provisions of this
Agreement shall be done as an independent contractor of Owner. Unless otherwise provided
herein, Owner shall not be obligated to reimburse Manager for (a)any expense for office
equipment or office supplies of Manager(unless and only to the extent incurred and used in the
promotion and leasing of the Property and/or the collection of income or payment of expenses
for the Property); (b) any overhead expenses of Manager incurred in its general offices in
excess of the pro rate portions of overhead expenses attributable to the Property; (c)any
salaries or wages allocable to time spent on projects other than the Property; or(d)any salaries,
wages, and expenses for any personnel other than personnel located at the Property site and/or
personnel spending a portion of their working hours (to be charged on a pro rate basis) at the
Property site specifically performing Managers duties under this Agreement. All payments to be
made by Manager under this Agreement shall be payable, or if otherwise paid by Manager,
reimbursable, from funds deposited in the Operating Account. Manager shall not be obligated
to make any advance to or for the account of Owner or to pay any sums except out of funds
held in the Operating Account, nor shall Manager be obligated to incur any liability or obligation
for the account of Owner without assurance satisfactory to Manager that the necessary funds
for the discharge thereof have been or will be promptty provided by Owner. Owner shall at all
times provide Manager, free of charge, with an appropriate management office at the Property.
4.2 Separation of Owners Moneys. Manager shall establish and maintain in a
banking or other financial institution reasonably approved by Owner whose deposits are insured
by the Federal Deposit Insurance Corporation or Federal Savings and Loan Insurance
Corporation, a separate bank or similar account in the name of Owner for the deposit of moneys
of Owner received with respect to the Property (the "Operating Account'). Manager shall also
establish such other special bank or similar accounts as may be reasonably required by Owner,
or as required under the law. If and only if the funds are to be used for an item set forth in the
Approved Budget, or as otherwise provided for by this Agreement, funds may be withdrawn
through authorized signature cards from all accounts upon the sole signature of Manager or any
of the following persons, on behalf of Manager: Tim Gooch, George Denington, Tammy Le, or
Jenny Blanchart ("Authorized Persons"). Manager shall immediately notify all financial
institutions if any of the Authorized Persons are no longer employed by Manager and cause
them to be removed as a signatory to withdraw funds. Manager's authority to withdraw funds
may be terminated at any time by Owner upon three (3) days written notice to Manager. In the
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vent of such termination, Owner will assume full liability for all existing financial obligations
incurred by the Manager for the Property incurred prior to the termination and in accordance
with this Agreement.
4.3 Manager Disbursements. Manager shall, from the available good funds
collected and deposited in the Operating Account, cause to be disbursed regularly and
punctually the following amounts (in the following order of priority (1)the amounts which Owner
from time to time advises Manager are to be paid for any loans secured by mortgages on the
Property, incurred before or after this Agreement becomes affective, including amounts which
Owner from time to time advises Manager are due under any mortgage for interest and
amortization of principal and for allocation to reserves or escrow funds; (2)the amounts
payable to Manager pursuant to this Agreement; and (3)the amounts otherwise due and
payable as operating expenses of the Property. Owner shall at all times maintain in the
Operating Account a balance equal to the highest projected monthly expenditures as
determined by the applicable Approved Budget for the Property. In addition, Owner shall within
five (5) business days after Manager's written request, deposit such additional funds as
Manager reasonably determines are needed to effect any authorized disbursements to be made
by Manager pursuant to the terms of this Agreement. In the event Owner fails to deposit the
amount of such expenses and fees, Manager shall be under no obligation to advance any funds
to meet the obligations for which the additional funds have been requested and shall not incur
any liability in connection therewith. However, Manager may elect to advance funds to pay such
expenses and shall in such event be entitled to reimbursement upon demand from Owner
therefor. Any funds remaining at the end of each calendar month during the term of this
Agreement in the Operating Account (in excess of the balance required to be maintained in
such account) shall be disbursed or transferred as generally or specifically directed from time to
time by Owner. Within fifteen (15) days after Manager's receipt of written request by Owner(but
no more often than once during each calendar month during the term of this Agreement),
Manager shall provide Owner with a list of the disbursements made by Manager during such
month and if so requested by Owner, invoices supporting the disbursement. Unless otherwise
provided for in the Approved Budget, Owner, and not Manager, shall be responsible for the
payment of all real estate taxes and other impositions levied by appropriate authorities.
ARTICLE V
Management and Other Fees
5.1 Management Fee. Owner shall pay to Manager, as compensation for
Managers management services, on a monthly basis, a management fee (the "Management
Fee") in an amount equal $2,000.00 per month.
5.2 Compensation for Tenant Finish Work and Capital Improvements. For
services which it performs in overseeing and/or managing the completion of tenant finish work
and construction of capital improvements within the Property, Owner shall pay Manager the fees
described on Exhibit "A" attached hereto in accordance with the terms and conditions set forth
on Exhibit"A"attached hereto.
5.3 Leasing Commissions. For services which it performs in connection with the
leasing of the Property, Owner shall pay Manager the fees described on Exhibit "B" attached
hereto in accordance with the terms and conditions set forth on Exhibit"B"attached hereto.
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5.4 Additional Services. It is expressly agreed that in the event Owner requires
Manager to perform or undertake additional services which are of an extraordinary nature or
which are not customarily performed (or which are performed less frequently) by property
management companies managing projects comparable to the Property located in the vicinity of
the Property, Owner shall pay to Manager additional feels) for such additional services, and the
amount of such additional feels) shall be reasonably and mutually agreed upon by Owner and
Manager.
ARTICLE VI
Insurance/Indemnity
6.1 Insurance. Owner shall maintain in full force and effect insurance policies
with respect to the Property, including any personal property of Owner, issued by insurance
companies which have an A.M. Best General Policyholder's Service rating of not less than "A-
VIII" which are licensed, or approved to do business, in the state in which the Property is
located. Such insurance policies shall provide the following coverages:
(a) Property Insurance. "All Risk" property insurance including fire,
sprinkler leakage if applicable and water damage in an amount not less than the full
replacement cost of the Property, with an agreed value endorsement sufficient to
prevent Owner from becoming a co-insurer in any loss under the policy. The
policies of insurance carried in accordance with this Section 6.1(a) shall contain (i) a
replacement cost endorsement without deduction for depreciation or obsolescence,
(ii)coverage for building ordinance, increased cost of construction, sinkhole
(subsidence) and pollution clean-up resulting from insured peril, and (iii)a waiver of
subrogation clause;
(b) Flood Insurance. If at any time the Property or any part thereof is within
a 100 year Flood Zone or an area designated "flood zone" pursuant to the National
Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973 (42
U.S.C. 4001 4128) or any amendments or supplements thereto or substitutions
therefor (collectively, the "National Flood Insurance Program"), flood insurance (to
the extent available at commercially reasonably rates) in such total amount as
Owner may from time to time reasonably require but in an amount not less than the
maximum available under the National Flood Insurance Program with a deductible
not exceeding $10,000, and which shall in any event comply with the National Flood
Insurance Program as set forth in the legislation;
(c) Earthquake Insurance. Earthquake insurance on the Property for not
less than the maximum probable loss if located in UBC Seismic Zones 3 and 4;
(d) Liability Insurance. Commercial General and Excess Liability
Insurance, written on an occurrence basis, including blanket contractual liability,
products and completed operations and personal injury coverage, notice of
occurrence, knowledge of occurrence, unintentional errors and omissions, pollution
from hostile fire, building heating equipment with a combined single limit for any one
occurrence of Fifteen Million Dollars ($15,000,000) or such higher limit as Manager
may from time to time reasonably request. Such requirement may be satisfied by a
layering of Commercial General Liability, Umbrella and Excess Liability policies, but
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in no event will the liability insurance be written for an amount less than Fifteen
Million Dollars ($15,000,000) combined single limit for bodily injury and property
damage liability;
(a) Boiler Insurance. Boiler and Machinery Breakdown Direct Damage
Insurance and third parry liability coverage (if not covered under the Commercial
General Liability Policy) with full comprehensive coverage on a repair and
replacement basis for all HVAC equipment, electrical equipment, boilers and
machinery which form a part of the Property, including building ordinance Business
Interruption Coverage for Loss of Rental Income in connection therewith in
accordance with Section 6.1(d) above;
(f) Builder's Risk Insurance. During the course of any construction or
repair of improvements or during the course of restoration on the Property (other
than tenant installation), Builder's Risk Insurance on a completed value basis and
on a non-reporting form against "all risks of physical loss," including flood (if
available at commercially reasonable rates), earthquake (if available at
commercially reasonable rates), collapse, transit and off-site coverage (if available
at commercially reasonable rates), during construction of such improvements or
restoration, with deductibles satisfactory to Owner, covering the total replacement
cost value of work performed and the equipment, supplies and materials furnished
(unless such equipment, supplies and materials are required to be insured by
contractors or vendors) and rent loss insurance for a period not less than twelve
(12) months or the construction period, whichever is the greater, in an amount
satisfactory to Owner. Such policy of insurance shall include coverage for building
ordinance, increased cost of construction, sinkhole (subsidence) and pollution
clean-up resulting from an insured peril, and shall contain a "permission to occupy"
endorsement, a waiver of coinsurance or an agreed amount endorsement and an
agreement by the insurer that following a loss, the insurer will pay to the insured
(I)the full value of the loss provided Owner is required to or elects to rebuild or
(11)the actual cash value of the loss in the event Owner is not required to or does
not elect to rebuild; AND
(g) Other Insurance. Such other insurance with respect to the Property, in
such amounts as Owner(or any lender in connection with a Financing) from time to
time may require against such other insurable hazards which at the time are
commonly insured against in respect of property similar to the Property.
6.2 Manager's Insurance. Manager shall, at the expense of Manager, maintain in
full force and effect insurance policies with respect to Manager and the employees of Manager
issued by insurance companies which have an A.M. Best General Policyholder's Service rating
of not less than "A-VIII," which are licensed and approved and authorized to do business in the
state in which the Property is located. Such policies shall provide the following coverage:
(a) Worker's Compensation Insurance. Worker's Compensation Insurance
as required by the Labor Code of the State of California, including Employer's
Liability Insurance with a minimum limit of $1,000,000.00. Such Worker's
Compensation Insurance shall be endorsed to provide for a waiver of subrogation in
favor of OCSD. A statement on an insurance certificate will not be accepted in lieu
of the actual endorsements unless your insurance carrier is State of California
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Insurance Fund (SCIF and the endorsement numbers 2570 and 2065 are
referenced on the certificate of insurance.
(b) Automobile Liability Insurance. Comprehensive automobile liability
insurance covering owned, non-owned, and hired vehicles in an amount not less
than Five Million Dollars ($5,000,000) combined single limit for bodily injury and
property damage. Such requirements may be satisfied by layering of
comprehensive automobile liability, umbrella and excess liability policies, but in no
event shall the comprehensive automobile liability policy be written for an amount
less than One Million Dollars ($1,000,000) combined single limit for bodily injury and
property damage.
(c) Errors and Omissions Fidelity Bond and Cvber Liability Insurance.
Fidelity bond and computer crime insurance with an annual limit of a minimum of
One Million Dollars ($1,000,000).
(i) Errors and Omissions Coverage (professional liability coverage)
in an amount of not less than $1.0 (one) million per occurrence throughout
the term of this Agreement
(it) A fidelity bond or crime insurance, in content acceptable to
OCSD, shall be carried in the amount of$1 (one) million dollars.
(iii) If the Manager provides services related to information
technology, the Manager must maintain third-party Cyber Liability insurance
with limits of not less than $1.0 million per occurrence covering claims
involving technology professional liability, privacy liability where applicable
(including but not limited to loss of OCSD employee information), security
liability where applicable (including but not limited to technology attacks via
hackers or viruses, and cyber extortion threats), media liability where
applicable (including but not limited to libel, slander and copyright
infringement from content created by the Vendor), and damage to or
destruction of electronic information or media.
(d) Commercial Liability Insurance. Commercial General Liability Insurance
written on an occurrence basis providing the following minimum limits of liability
coverage: $5.0 million per occurrence with $5.0 million aggregate separate for this
contract. Said insurance shall include coverage for the following hazards:
Premises-Operations, blanket contractual liability (for this Agreement), products
liability/completed operations (including any product manufactured or assembled),
broad form property damage, blanket contractual liability, independent contractors
liability, personal and advertising injury, mobile equipment, cross liability and
severability of interest clauses. A statement on an insurance certificate will not be
accepted in lieu of the actual additional insured endorsement(s). If requested by
OCSD and applicable, XCU coverage (Explosion, Collapse and Underground) and
Riggers Liability must be included in the General Liability policy and coverage must
be reflected on submitted Certificate of Insurance.
(a) Umbrella Excess Liability The minimum limits of general liability and
automotive liability insurance required, as set forth above, shall be provided for
either a single policy of primary insurance, or a combination of policies of primary
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and umbrella excess coverage. Umbrella excess liability coverage shall be issued
with limits of liability which, when combined with the primary insurance, will equal
the minimum limits for general liability and automotive liability.
(f) Additional Insured Endorsements Each policy of insurance obtained,
except Worker's Compensation Coverage and Errors and Omissions Coverage,
shall name OCSD, its Directors, officers, agents, consultants, and employees for
this contract, and all public agencies from whom permits will be obtained and their
Directors, officers, agents and employees, as determined by OCSD, as additional
insured on said policies. No exclusionary language or limitations shall be applicable
to any additional insured that are not applicable to the named insured. In addition,
insurance afforded by the additional insured endorsement shall apply as primary
insurance, and other insurance maintained by OCSD shall be excess only and not
contributing with insurance provided under said policies. If this coverage is not
provided within the coverage form (insurance policy) it shall also be endorsed as
primary and non-contributory coverage.
(g) Proof of Coverage The Vendor shall furnish OCSD with original
certificates and amendatory endorsements effecting coverage. Said policies and
endorsements shall conform to the requirements herein stated. All certificates and
endorsements are to be received and approved by OCSD before work commences.
OCSD reserves the right to require complete, certified copies of all required
insurance policies, including endorsements, affecting the coverage required, at any
time. The following are approved forms that must be submitted as proof of
coverage:
• Certificate of Insurance ACORD Form 25 or other equivalent
Certificate of Insurance form.
• Additional Insured (GL) (ISO Form) CG2010 11 85 or
The combination of(ISO Forms) CG 2010 10 01 and CG 2037 10 01
All other Additional Insured endorsements must be submitted for
approval by OCSD, and OCSD may reject alternatives that provide
different or less coverage to OCSD.
• Additional Insured (Auto) Submit endorsement provided by carrier
for OCSD approval.
• Waiver of Subrogation State Compensation Insurance Fund
Endorsement No. 2570 or equivalent.
• Cancellation Notice State Compensation Insurance Fund
Endorsement No. 2065 or equivalent.
(h) Period of Coverage Insurance coverage is required during the period of
this contract.
(i) Cancellation Notice. Each insurance policy required herein shall be
endorsed to state that coverage shall not be cancelled by either party, except after
thirty (30) days' prior written notice. The ACORD Form shall state the required thirty
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(30) days' written notification Policy shall not terminate, nor shall it be cancelled
nor the coverage reduced, until thirty(30)days after written notice is given to OCSD
except for non payment of premium which shall require not less than ten (10) days
written notice to OCSD. Should there be changes in coverage or an increase in
deductible or SIR amounts, the Vendor and its insurance broker/agent shall send
to OCSD a certified letter which includes a description of the changes in coverage
and/or any increase in deductible or SIR amounts. The certified letter must be sent
to the attention of Risk Management, Div. 260, and shall be received by OCSD not
less than thirty (30) days prior to the effective date of the change(s) if the change
would reduce coverage or increase deductibles or SIR amounts or otherwise reduce
or limit the scope of insurance coverage provided to the OCSD.
0) Insurance Carrier Rating The insurers must have an A- (A minus), or
better, policyholders rating, and a financial rating of Class Vill, or better, in
accordance with the most current A.M. Best Rating. OCSD recognizes that State
Compensation Insurance Fund has withdrawn from participation in the A.M. Best's
rating process. Nevertheless, OCSD will accept State Compensation Insurance
Fund for the required policy of Workers Compensation Insurance, subject to
OCSD's option, at any time during the term of this contract, to require a change in
insurer, upon twenty (20) days written notice. OCSD will also require Vendor to
substitute any insurer whose rating drops below levels herein specified. Said
substitution shall occur within twenty (20) days of written notice to Vendor by OCSD
or its agent.
(k) Primary Insurance All liability policies shall contain a Primary and Non
Contributory Clause. Any other insurance maintained by OCSD shall be excess
and not contributing with the insurance provided by Vendor
(1) Separation of Insured All liability policies shall contain a "Separation of
Insured"clause.
(m) Non Limiting (if applicable). Nothing in this document shall be construed
as limiting in any way, nor shall it limit the indemnification provision contained in the
Agreement, or the extent to which Vendor may be held responsible for payments of
damages to persons or property.
In) Deductibles and Self Insured Retentions Any deductible and/or self
insured retention must be declared to OCSD on the Certificate of Insurance. All
deductible and/or self insured retentions require approval by OCSD. At the option
of OCSD, either: the insurer shall reduce or eliminate such deductible or self-
insured retention as respects OCSD; or the Vendor shall provide a financial
guarantee satisfactory to OCSD guaranteeing payment of losses and related
investigations, claim administration and defense expenses.
(0) Defense Costs Liability policies, except for Errors and Omissions
Coverage, shall have a provision that defense costs for all insureds and additional
insureds are paid in addition to and do not deplete any policy limits
(p) Limits Are Minimums If Manager maintains higher limits than any
minimums shown above, OCSD requires and shall be entitled to coverage for the
higher limits maintained by Vendor.
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6.3 Blanket Insurance. Manager may effect any coverage required of Manager
under Section 6.2 above under a blanket insurance policy, provided that the protection afforded
under any policy of blanket insurance hereunder shall be no less than that which would have
been afforded under a separate policy or policies relating only to the Property.
6.4 Policies.
(a) Owner Named Insured. All of the insurance policies maintained under
Section 6.1 shall name Owner as the insured and shall also include Manager as an
additional insured or loss payee, as its interest may appear.
(b) Owner and Manager Named Insured. The insurance maintained under
Section 6.1(d) (Liability Insurance) shall name Manager as an insured, and the
insurance maintained under Section 6.2(b) (Automobile Insurance), Section 6.2(c)
(Fidelity Bond Insurance) and Section 6.2(d) (Commercial Liability Insurance) shall
name Owner, if requested, as an insured and such other parties in interest as
Owner or Manager may reasonably specify from time to time as additional insureds
or loss payees, as their respective interests might appear.
(c) Terms of Policies. All insurance policies maintained pursuant to this
Agreement shall provide that (i) no cancellation, material change or reduction
thereof shall be effective until at least thirty (30) days after receipt by Owner and
Manager of written notice thereof; and (ii) all losses covered by the required
insurance shall be payable notwithstanding any act of negligence of Manager or any
tenant or their partners, members, stockholders, directors, officers, employees or
agents which might, absent such agreement, result in a forfeiture of all or part of
such insurance payment and notwithstanding ( (1)any foreclosure or other action or
proceeding taken pursuant to the provision of any financing instruments
encumbering the Property or(2)any change in title or ownership of the Property. In
the event of any financing secured by the Property, all insurance shall comply with
the terms of such financing.
(d) Self Insurance. It is understood that Owner is a large public agency that
has a program of insurance and self-insurance with regard to its properties. Orange
County Sanitation District will arrange for insurance or self-insurance on the
Property, as its Board or management shall approve from time to time, and which
may include insurance or self-insurance for property, flood, earthquake, business
interruption, excess liability, workers compensation, boiler & machinery, builders
risk, pollution liability and perhaps others. Owner will from time to time, as
reasonably requested by Manager, provide certificates of insurance and letters of
self-insurance describing the insurance and self-insurance carried by Owner.
Variations of Owners actual insurance program from the requirements defined in
the Agreement shall not constitute a default under this Agreement, but shall be
deemed to be an election by Owner to self-insure for any risks or liabilities. Upon
the full execution of this Agreement, Owner shall provide Manager with a
description of the process by which a claim may be made under Owners self-
insurance program. All of Owners insurance obligations undertaken with respect to
self-insured risks shall survive the expiration or eadier termination of the
Agreement.
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(a) Evidence of Renewal and Premium Payment. Owner and Manager
shall furnish to each other, upon request, prior to the expiration date of each
insurance policy required to be maintained under this Article VI, certificates of
insurance of the renewal thereof.
6.5 Claims. In the event of a loss related to the Property under any of the
insurance policies described in Sections 6.1, Section 6.2(b), Section 6.2(c) and Section 6.2(d),
Manager shall, at Owner's expense, promptly and timely after Manager learns of such loss, file
a claim on behalf of Owner (and Manager or any other party to the extent Manager or such
other party is also an insured party) and use commercially reasonable efforts to monitor such
claim on behalf of such insured party and cooperate fully with any appointed representatives,
consultants and adjusters retained by or on behalf of the insurance companies' interests.
6.6 Subrogation. Owner and Manager each waive any right of recovery against
the other(and the respective officers, directors, partners, members and employees of each), for
any loss or damage covered by any policy of property insurance applicable to the Property,
whether due to the negligence of Owner or Manager or their agents, contractors, officers,
directors, partners, members or employees. If any property insurance policy provides that a
waiver of subrogation may only be granted by endorsement, the party maintaining such policy
shall secure an endorsement providing the waiver of subrogation.
6.7 Indemnity. Neither Manager (nor any employee, agent, director, officer, or
owner thereof(collectively, the "Manager Partners")) shall be liable, responsible, or accountable
in damages or otherwise to Owner for any acts performed by Manager or any of the Manager
Partners in good faith. Manager shall be liable for, and shall indemnify, defend and hold
harmless Owner from and against, any and all claims, losses, damages, liabilities, costs and
expenses, including reasonable attorneys' fees (collectively, "Claims") arising out of any actions
of Manager not within the scope of its duties under this Agreement and proximately caused by
the negligence or willful misconduct of Manager, except (1) to the extent such losses are of the
type insured, or are required to be insured by Owner under this Agreement, (ii) any latent defect
on the Property; or (ill) Owners failure to cooperate in any repairs or remediating any defects to
the Property after such conditions are discovered and brought to the attention of Owner. Owner
shall be liable for, and shall indemnify, defend and hold harmless Manager and the Manager
Partners, from and against any and all Claims arising out of or resulting from (i) the acts or
omissions of Manager in connection with the performance of Manager's duties under this
Agreement, and (ill)from the acts or omissions of Owner and its directors and officers, except
that the foregoing indemnity obligation of Owner shall not apply in the case of the acts or
omissions of Manager or any other Manager Partner which (a) are a breach by Manager under
this Agreement, (b) are beyond the scope of authority conferred upon Manager under this
Agreement, , or (c) constitute gross negligence, fraud, malfeasance, breach of fiduciary duty,
willful, reckless or criminal misconduct. The provisions of this Section 6.7 shall survive the
expiration or termination of this Agreement.
ARTICLE VII
Obligations Upon Termination
7.1 Survival of Obligations. Upon termination of this Agreement, each party shall
continue to be fully liable for its obligations which have accrued up to and including the
termination date and shall promptly pay to the other party all amounts due to such other party
672so2.0a
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12971M I
under the terms of this Agreement. Such payment shall be made as soon after the effective
date of termination as such amounts are determinable. Upon such payment, neither party shall
have any further claim or right against the other, except as expressly provided in this
Agreement.
7.2 Obligations Upon Termination. In the event of termination of this Agreement,
upon the effective date of such termination, Manager shall (i) surrender and deliver to Owner all
rent and other income of the Property and other moneys of Owner then held by Manager and/or
in any bank account (including, without limitation, the Operating Account) in excess of
compensation or reimbursements owed Manager by Owner, including without limitation any fees
payable or reimbursement of expenses due and payable to Manager, (ii) deliver to Owner as
received by Manager any moneys or other property due Owner under this Agreement but
received after such effective date of termination, and (iii)deliver to Owner (without warranty)
copies of all records regarding the Property, keys and all other materials, property and supplies
pertaining to the Property and/or this Agreement in the possession of Manager to allow Owner
to fully operate, maintain, and manage the Property.
ARTICLE VIII
Miscellaneous
8.1 No Assignment by Manager. Without the prior written consent of Owner,
Manager shall not have the right to assign, transfer, or convey any of its rights, title, or interest
under this Agreement, nor shall it have the right to delegate any of the obligations or duties
required to be kept or performed by it under this Agreement.,.
8.2 Successors and Assigns. Subject to the terms and conditions of Section 8.1
above, this Agreement shall be binding upon and shall inure to the benefit of the parties to this
Agreement and their respective permitted successors and assigns.
8.3 No Agency. Manager is an independent contractor and, as such, shall be
solely responsible for all of its employees, for the supervision of all persons performing services
in connection with the performance of all of Manager's obligations under this Agreement and/or
relating to the Property, and for determining the manner and time of performance of all acts
under this Agreement. Nothing contained in this Agreement shall be deemed or construed to
create a partnership or joint venture between Owner and Manager or to cause Manager to be
responsible in any way for the debts or obligations of Owner or any other party (but nothing
contained herein shall affect Manager's responsibility to transmit payments for the account of
Owner as provided in this Agreement), it being the intention of the parties that the only
relationship under this Agreement is one of independent contractor , and Manager shall not
represent to anyone that its relationship to Owner is other than that set forth herein.
8.4 Notices. All notices, demands, consents, approvals, and requests given or
required to be given by either parry to the other under this Agreement shall be in writing, shall
be sent by (a) United States mail, postage prepaid, return receipt tracked or confirmed, or (b)
delivered by a nationally recognized overnight courier or(c)delivered personally: (i)to Manager
at the appropriate address set forth below in this Section 8.4, or to such other place as Manager
may from time to time designate in a notice to Owner; or(ii)to Owner at the addresses set forth
below in this Section 8.4, or to such other place as Owner may from time to time designate in a
notice to Manager . Any notice, demand, consent, approval, and/or request will be deemed
given (a) on the date which is seventy-two (72) hours after it is mailed as provided in this
sr2w2.0x
2a>oosooao�le-sl2naees -is-
12991061
Section 8.4, (b) upon the date personal delivery is made or rejected, or (c) on the date which is
one (1) business day after it is sent by nationally recognized overnight courier, as the case may
be.
If to Owner. Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, CA 92708
Attention: Ann M. Grafton
Principal Staff Analyst
With a copy to:
Bradley R. Hogin, Esq.
Woodruff, Spradlin & Smart, APC
555 Anton Boulevard, Suite 1200
Costa Mesa, CA 92626-7670
If to Manager: The Muller Company
18881 Von Karmen Avenue, Suite 400
Irvine, CA 92612
Attention: Jenny Blanchart
8.5 Security Deposits. Owner agrees to indemnify, defend and hold harmless
Manager from and against any and all Claims with respect to any use, detention, or
misapplication by Owner of tenants' security deposits.
8.6 Remedies. Notwithstanding anything herein to the contrary, Manager shall
not be liable to Owner and Owner shall not be liable to Manager under this Agreement for any
damages (other than actual damages) such as, without limitation, any lost profits, loss of
business, consequential, special, or other similar damages. Prior to any recovery against
Manager or Owner under this Agreement, Manager or Owner, as the case may be, must be
given written notice and a reasonable opportunity to cure any default or other condition which is
the basis for such recovery.
8.7 Captions. The captions of this Agreement are inserted only for the purpose
of convenient reference and do not define, limit or prescribe the scope or intent of this
Agreement or any part hereof.
8.8 No Waiver. The failure of a party hereto to seek redress for breach, or to
insist upon the strict performance of any covenant, agreement, provision or condition of this
Agreement, shall not constitute a waiver thereof, and such party shall have all remedies
provided herein and by applicable law with respect to any subsequent act which would have
originally constituted a breach.
8.9 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
8.10 No Third Party Beneficiaries. Neither this Agreement nor any part of this
Agreement nor any service, relationship, or other matter alluded to herein shall inure to the
benefit of any third party (specifically including any lenders, tenants, or contractors), to any
trustee in bankruptcy, to any assignee for the benefit of creditors, to any receiver by reason of
672502M]
23700MO00716-o-lvmmdw -17-
12971051
insolvency, to any other fiduciary or officer representing a bankruptcy or insolvent estate of
either parry, or to the creditors or claimants of such an estate. Without limiting the generality of
the foregoing sentence, it is specifically understood and agreed that insolvency or bankruptcy of
either of Owner (including any partners thereof) or Manager shall at the option of the other void
all rights of such insolvent or bankrupt party under this Agreement (or so many of such rights as
the other party shall elect to void).
8.11 Subordination. Managers rights hereunder are all expressly subordinate,
junior, and inferior to any ground lease, mortgage, or deed of trust now or hereafter placed upon
the Property and to any and all advances to be made thereunder and to the interest thereon and
to all renewals, replacements, and extensions thereof.
8.12 Attorneys' Fees. If either party to this Agreement brings any action to enforce
its terms, the prevailing party shall be entitled to receive reasonable attorneys' fees and costs
from the other party.
8.13 Change of Manager Status. If there is any dissolution, termination of
corporate status, suspension in any licenses required to carry out Manager's duties as provided
in this Agreement, change in control (i.e. sale of stock, sale of company, merger, sale of
substantially all the assets, etc.), or any of the of the current Executive Team (as set forth in the
2113/18 proposal) leaves the employment of Manager, Owner shall be provided immediate
written notice of such change and Owner shall have the right to terminate this Agreement by
delivery of a written notice of termination to Manager within 30 days from receipt of Manager's
notice.
8.14 Validi . If any term or provision of this Agreement or the application thereof
to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of
this Agreement, or the application of such term or provision to persons or circumstances other
than those as to which it is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and be enforced to the fullest extent
permitted by law.
8.15 Entire Agreement. This Agreement contains the entire agreement between
the parties hereto with respect to the matters herein contained and any agreement hereafter
made shall be ineffective to effect any change or modification, in whole or in part, unless such
agreement is in writing and signed by the party against whom enforcement of the change or
modification is sought.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
672W203"
201006WWVi IVMbWW -18-
12971MI
Consultant: THE MULLER COMPANY
Jenny Blanchart
18881 Von Kaman Avenue
Suite 400
Irvine, CA 92612
c7�I7
ORANGE COUNTY SANITATION DISTRICT
Dated: Z'V k � By:
Gregory eboum, PLS
Chair, BbSrd of Directors
Dated: C�Iag� iB By:
I . L elly re -
A rk of the Board
Dated: By. Marc Dubois
Contracts, Purchasing and
Materials Manager
THE MULLER COMPANY
Dated: By: �
0-on MulI /131anacer
Print Name and Title Office
IRS Employer's I.D. Number
672W20Y
n704mo67re.Mavde -1&
134n061
EXHIBIT "A"
CM SERVICES AND FEES
(a) Construction Management Fee. Manager shall be entitled to a fee (the
'Construction Management Fee') for oversight, conformity, coordination and supervision of the
design and build out of tenant improvements made in conjunction with new leases, extensions
or renewals of existing leases or expansions of the leased space under existing leases, and
construction projects authorized by the Owner that take place during the term of the Agreement
(each, an "Improvement Project"). For Improvement Projects where the construction costs for
the Improvement Project exceed Five Thousand Dollars ($5,000), Owner shall pay Manager a
Construction Management Fee in an amount equal to five percent (5%) of the hard construction
costs for such Improvement Project.
(b) Minor Improvement Proiects. Notwithstanding anything to the contrary, no
Construction Management Fee will be paid for any Improvement Projects where either (i)the
scope of such Improvement Project is limited to paint and carpet or (ii)the construction costs
are Five Thousand Dollars ($5,000)or less.
(c) Construction Management Services. As part of Manager's construction
management services with respect to Improvement Projects, Manager shall, at Owners
expense, use commercially reasonable efforts to manage, arrange, supervise and coordinate,
subject to the approval and direction of Owner, the design, construction and planning services
of such Improvement Project,which services shall include the following:
(i) Arranging, supervising and coordinating the preparation of feasibility,
architectural, engineering, environmental and other studies as may be required;
(ii) Arranging for the preparation and submission to Owner for approval and,
following approval by Owner, monitoring compliance with:
A. Plans and specifications, such plans and specifications to be
prepared by one or more independent consultants approved by Owner, setting
forth the scope of the Improvement Project and methods of construction to be
used in the Improvement Project;
B. A budget setting forth estimated costs of the design and
construction of the Improvement Project; and
C. A list of proposed contractors, consultants and other professionals
to be employed in the design and construction of the Improvement Project.
(iii) Arranging, supervising and coordinating the design, construction and
planning services necessary to complete the Improvement Project, which actions shall
be subject to the approval and direction of Owner, including the following:
A. Coordinating with the consultants and other professionals on
matters relating to the plans and specifications and any modifications thereto;
6725U.w
30900F00007M1 IV W -1-
13971W I
B. Coordinating with contractors to prepare cost estimates of the
Improvement Project and reviewing and advising Owner with respect to all bid
documents;
C. Preparing and negotiating design and construction contracts and
other Contracts, if required, for the supply of services and materials necessary to
design, construct and complete the Improvement Project;
D. Reviewing and negotiating all change orders for the Improvement
Project which change orders shall be submitted to Owner for its approval;
E. Reviewing applications for payment submitted by consultants,
contractors and suppliers in connection with the design, construction and
completion of the Improvement Project, and submission of such applications to
Owner for approval of payment;
F. Preparing applications to municipal, other governmental, quasi-
governmental and private authorities for Permits, including building permits,
inspections and approvals, which applications shall be submitted to Owner for
Owner's approval, and upon approval thereof by Owner, shall be submitted by
Manager to the applicable authority;
G. Supervising and coordinating construction of the Improvement
Project;
H. Coordinating and supervising the obtaining and maintenance of all
Permits and other authorizations necessary for the Improvement Project; and
I. Recording and reporting to Owner the progress of the construction
of the Improvement Project.
(iv) Causing complete and accurate files, books of account and other records
of all construction costs and expenses of the Improvement Project incurred by Owner to
be prepared and maintained in accordance with generally accepted accounting
principles.
672502.=u
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12971061
EXHIBIT"B"
LEASING COMMISSIONS
Owner shall pay Manager a Leasing Commission (i) for each New Tenant (as defined below) who
executes an Occupancy Lease (as defined below) during the term of the Agreement (each, a "New
Tenant Lease"), (ii) for each tenant who extends the term of its Occupancy Lease during the term of
the Agreement (an "Extension"), and (iii) for each tenant who expands the space leased by such
tenant under its Occupancy Lease during the term of the Agreement (an "Expansion"), which
Extension or Expansion (as the case may be) shall be pursuant to (A)the exercise by such tenant of
its extension or expansion rights under the Occupancy Lease, and/or (B) an Amendment to an
Occupancy Lease entered into by Owner and such tenant. All leasing commissions shall be paid from
the Operating Account and all leases (i.e. New Tenant Lease, Extension, or Expansion) shall be
signed by Owner.
The term "New Tenant" shall mean a tenant who has not previously entered an Occupancy Lease
then in effect for space at the Property. The term "Occupancy Lease" shall mean a lease of space at
the Property, executed and delivered by Owner(or Owner's predecessor, as applicable) and a tenant.
The term "Amendment to an Occupancy Lease' shall mean an amendment to an Occupancy Lease
executed and delivered by Owner and a tenant. The term "Gross Rentals" shall mean the annual
base rental rate stipulated in the Occupancy Lease or Amendment to Occupancy Lease (including
stipulated increases, if any) multiplied by the rentable square footage of the leased space subject to
the New Tenant Lease, Extension or Expansion (as applicable), the total of which shall then be
multiplied by the period comprising the Basic Term.
For each Occupancy Lease or Amendment to Occupancy Lease, the "Basic Term' shall be the initial
term of such New Tenant Lease, Expansion or Extension (i.e., the term of the New Tenant Lease,
Expansion or Extension without regard to any option to extend); and provided that if an Occupancy
Lease or Amendment to Occupancy Lease contains an express option in favor of the tenant to cancel
or terminate the New Tenant Lease, Expansion or Extension (herein a 'Tenant Termination Option"),
the "Basic Term" shall initially include only that portion of the term of such New Tenant Lease,
Expansion or Extension which is not subject to cancellation by exercise of such Tenant Termination
Option; provided, however, if such Tenant Termination Option is waived by the tenant (or otherwise
lapses) during the term of the Agreement, then the Leasing Commission applicable to the remainder
of the initial term of such New Tenant Lease, Expansion or Extension shall become payable to
Manager within thirty (30)days after the date such Tenant Termination Option is waived by such
tenant (or otherwise lapses). Notwithstanding the foregoing, should an Occupancy Lease or
Amendment to Occupancy Lease for any such New Tenant Lease, Expansion or Extension contain a
Tenant Termination Option which is conditioned upon the tenant paying a cancellation penalty to the
landlord therefor and such cancellation penalty includes the amount of all unamortized Leasing
Commissions payable to Manager with respect to such New Tenant Lease, Expansion or Extension,
then Owner will pay Manager all of the Leasing Commissions due hereinabove with respect to such
New Tenant Lease, Expansion or Extension as if no such Tenant Termination Option existed.
Fifty percent (50%) of the applicable Leasing Commission will be paid to Manager within thirty
(30) days after all of the following have occurred: (i) if an Occupancy Lease or Amendment to
Occupancy Lease is entered into with respect to such New Tenant Lease, Extension or Expansion,
the execution of the Occupancy Lease or Amendment to Occupancy Lease by all parties; (ii)the
tenant's payment of any security deposit and prepaid rent applicable to such New Tenant Lease,
672W.09
2370OM060716-61vdWdly -3-
12WI06.1
Extension or Expansion if provided for in the Occupancy Lease or Amendment to Occupancy Lease
and delivery of any Occupancy Lease or Amendment to Occupancy Lease guaranty, letter of credit
and other security documents that are due on Occupancy Lease or Amendment to Occupancy Lease
execution; (iii) if an Occupancy Lease or Amendment to Occupancy Lease is entered into in
accordance with such New Tenant Lease, Extension or Expansion, the delivery of the fully executed
Occupancy Lease or Amendment to Occupancy Lease by Owner(or Manager on behalf of Owner) to
tenant; (iv)the expiration of any contingencies effecting the validity of the Occupancy Lease or
Amendment to Occupancy Lease for such New Tenant Lease, the Extension or Expansion; and
(v) Owner's receipt of a factually correct invoice from Manager for all Leasing Commissions due for
the subject Occupancy Lease or Amendment to Occupancy Lease. The balance of the applicable
Leasing Commission will be paid within thirty (30) days after the commencement date of the New
Tenant Lease, Extension or Expansion.
The Leasing Commission is as set forth below and the percentage set forth below shall equal the
percentage of Gross Rentals required to be paid by (x)each New Tenant under its New Tenant
Lease over the Basic Term of such New Tenant Lease, and (y) each tenant of any Extension or
Expansion over the Basic Term of such applicable Extension or Expansion:
I. New Tenant Leases No Outside Broker:
4.0% of Gross Rentals for years 1 to 5 of the Basic Term
2.0% of Gross Rentals for years 6 to 10 of the Basic Term
Outside Broker:
Lesser of (i) 1.0% of Gross Rentals for years 1 to 5 of the
Basic Term/ 0.50% of Gross Rentals for years 6 to 10 of the
Basic Term or (ii) the net of 5.0% of Gross Rentals for the
Basic Term minus any leasing commission payable to any
Outside Broker(if applicable).
It. Extension/Expansion No Outside Broker:
2.5% of Gross Rentals for years 1 to 5 of the Basic Term
1.25% of Gross Rentals for years 6 to 10 of the Basic Term
Outside Broker:
Lesser of (i) 1.0% of Gross Rentals for years 1 to 5 of the
Basic Term / 0.5% of Gross Rentals for years 6 to 10 of the
Basic Term or(ii)the net of 5.0% of Gross Rentals minus any
leasing commissions payable to any Outside Broker or any
Listing Broker(if applicable).
zr2s ZWm
2$700MD0071asl VdMm 4-
29 iI I
A
AMENDMENT NO. I TO MANAGEMENT AGREEMENT
This AMENDMENT NO. I TO MANAGEMENT AGREEMENT("Amendment") is made and entered `
into effective as of August 28,2018, by and between ORANGE COUNTY SANITATION DISTRICT,a county
sanitation district duly organized and existing pursuant to Section 4700 et. seq. of the Health & Safety Code of
the State of California("Owner"),and THE MULLER COMPANY,LLC("Manager").
RECITALS:
A. Owner and Manager entered into that certain Management Agreement dated as of February 28,
2018 (the "Agreement') pursuant to which Owner contracted with Manager to provide management services
forl8350 Mount Langley, Fountain Valley,California,the"Property".
B. Except as otherwise set forth herein,all capitalized terms used in this Amendment shall have the
same meaning given such terms in the Agreement.
C. Owner and Manager desire to amend the Agreement to change the Management Fee and
Properties,as hereinafter provided.
NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual covenants contained
herein, and for other goad and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged,the parties hereto agree as follows:
I. The Parties agree to correct an inadvertent error in the Management Agreement with respect to
THE MULLER COMPANY time. Through this Amendment No. 1 to Management Agreement,
the name of the Manager is hereby revised to read THE MULLER COMPANY,LLC.The Parties
desire that this Item 1 of Amendment No, I to Management Agreement be incorporated into the
Agreement,and become a part thereof from the beginning.
2. Parties agree to exercise the Option to renew the Agreement for a six(6)month tern from
August 28,2018 through February 28,2019.
3. The Agreement shall be expanded to include the management of the following: 18368, 18375,
18381, 18384, 18410, 18430, 18436 Bandilier Circle and 18429 Pacific Street, Fountain Valley
("Additional Properties")
4. Effective Date of Additional Properties:August 28,2018
5. The parties hereby agree that the Owner shall pay to Manager, as compensation for Manager's
management services, on a monthly basis, a management fee (the "Additional Properties
Management Fee") in the amount equal to $0.05/psf/month for the actual Additional Properties
in addition to the existing Management Fee in the Agreement for the Property. The square
footage of the Additional Properties and Additional Properties Management Fee per each
individual Additional Property is as follows:
a. 18368 Bandilier Circle 6,000 sq.ft. $ 300.00/month
b. 18375 Bandilier Circle 6,000 sq.ft. $ 300.00/month
c. 18381 Bandilier Circle 6,000 sq.ft. $ 300.00/month
d. 18384 Bandilier Circle 6,000 sq.ft. $ 300.00/month
e. 18410 Bandilier Circle 6,000 sq.ft. $ 300.00/month
f 19430 Bandilier Circle 6,000 sq.ft. $ 300.00/month
g. 18436 Bandilier Circle 6,000 sq.ft. $ 300.00/month
h. 18429 Pacific Street 23,847 sq.ft. $ 1,192.35/month
Total square footage: 65,847 @$0.05/psf/month= $3,292.35/month
6. No Further Modification. Except as set forth in this Amendment,all of the terms and provisions
of the Agreement shall remain unmodified and in full force and effect.
IN WITNESS WHEREOF,this Amendment has been executed as of the day and year first above written.
ORANGE COUNTY SANITATION
/J DISTRICT
Dated: "1 OI I g By.
Gregory C. Seboum, PLS Chair, Board-of_
/� p� Directors - -
Dated: gkyd/ O B7.
Kelly A. ore 1 rk of the Board - -
Dated: By - ---_ _
Marc Dubois, Contracts, Purchasing and
Materials Manager
THE MULLER COMPANY, LLC
Dated: l?Jy /l g By:
h MUllty
Print Name and Title of Officer
9V- D3(Poo 7.;2
IRS Employer's I.D. Number
-2-
AMENDMENT NO.2 TO MANAGEMENT AGREEMENT
This AMENDMENT NO.2 TO MANAGEMENT AGREEMENT("Amendment") is made and entered
into effective as of February 28,2019,by and between ORANGE COUNTY SANITATION DISTRICT,a county
sanitation district duly organized and existing pursuant to Section 4700 et. seq. of the Health & Safety Code of
the State of California("Owner"),and THE MULLER COMPANY,LLC("Manager").
RECITALS :
A. Owner and Manager enured into that certain Management Agreement dated as of February 28,
2018 and Amendment No 1 dated August 28, 2018 (collectively the "Agreement") pursuant to which Owner
contracted with Manager to provide management services forl8350 Mount Langley,Fountain Valley,California,
the "Property" and to provide management services for 18368, 18375, 18381, 18384, 18410, 18430, 19436
Bandilier Circle and 18429 Pacific Street,Fountain Valley,California,the"Additional Properties".
B. Except as otherwise set forth herein,all capitalized terms used in this Amendment shall have the
same meaning given such terns in the Agreement.
C. Owner and Manager desire to amend the Agreement to change the Expiration Date,as hereinafter
provided.
NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged,the parties hereto agree as follows:
1. Parties agree to exercise the Option to renew the Agreement for a size(6)month tern from
March 1,2019 through August 31,2019("Expiration Date").
2. No Further Modification. Except as set forth in this Amendment No. 2, all of the terns and
provisions of the Agreement shall remain unmodified and in full force and effect.
IN WITNESS WHEREOF,this Amendment has been executed as of the day and year first above written.
(Sigxaih a oa nWPW)
ORANGE COUNTY SANITATION
,,/� DISTRI T
Dated: I I ILVVW Ijf_I /�� I By: / ( ld
David John h er, Chair; Board of
�,�/� �] n Directors
Dated: r 1 ICI B
n n�f �1..� Kelly
/'1A. ore I rk of the Board
Dated: r Y I am I d- 1, o �� � By: VI�—, wt
Marc Dubois, Contracts, Purchasing and
Materials Manager
THE MULLER COMPANY, LLC
Dated: 31 U LUill By:
Jo M uller President
Print Mme and Title of Officer
IRS Employer's I.D. Number
WOODRUFF, SPRADLINeSMART CLOSED SESSION 1
555 ANION BOULEVARD, SUITE 1200
COSTA M.s A, CA 92626-7670
(714)556-7000
MEMORANDUM
TO: Hon. Chair and Members of the Orange County Sanitation District Steering
Committee
FROM: Bradley R. Hogin, Esq.
General Counsel
DATE: May 14, 2019
RE: Closed Session Items
The Steering Committee will hold a closed session on May 22,2019 for the purpose of
conferring with its labor negotiators to discuss negotiations with the International Union of
Operating Engineers Local 501,the Orange County Employees Association, and the Supervisors
and Professionals Group. The Agency Designated Representatives are Laura Kalty, Liebert
Cassidy Whitmore,James Herberg, Lorenzo Tyner, and Celia Chandler. The closed session will
be held pursuant to authority of California Government Code Section 54957.6.
Respec y submitted,
By:
Bradley . Hogin, G eral Counsel
1411305.1
WOODRUFF, SPRADLIN&SMART CLOSED SESSION 2
555 ANION BOULEVARD, BUTTE 1200
COSTA M.s A, CA 92626-7670
(714)559-7000
MEMORANDUM
TO: Hon. Chair and Members of the Orange County Sanitation District Steering
Committee
FROM: Bradley R. Hogin, Esq.
General Counsel
DATE: May 14, 2019
RE: Closed Session Items
The Steering Committee desires to hold a closed session on May 22, 2019 for the purpose
of conferring with its legal counsel regarding existing litigation to which the District is a party.
The title of the case is Klean Waters, Inc. et. al. v. Orange County Sanitation District, United
States District Court, Central District of California, Southern Division, Case No. 8:15-cv-00627.
The closed session will be held pursuant to the authority of California Government Code Section
54956.9(d)(1).
Respectfully submitted,
By /m
Bradle . Hogin, Qeneral Counsel
1411293.1
WOODRUFF $PRADllN ART
&SM
CLOSED SESSION 3
555 ANION BOULEVARD, BUTTE 1200
COSTA M.s A, CA 92626-9670
(714)559-9000
MEMORANDUM
TO: Hon. Chair and Members of the Orange County Sanitation District Steering
Committee
FROM: Bradley R. Hogin, Esq.
General Counsel
DATE: May 14, 2019
RE: Closed Session Items
The Steering Committee desires to hold a closed session on May 22, 2019 for the purpose
of conferring with its negotiators regarding the purchase of real property. The negotiating parties
and properties are as follows: De La Rosa Maintenance,APN No. 156-163-11, Gigamem,LLC,
APN No. 156-163-11,Thum Nguyen, APN No. 156-163-11,Uber Chic Home, LLC, APN No.
156-163-11, LLC, Deborah Muccillo dba Interiors Within Reach,APN No. 156-163-10,
Leadingware Group, Inc.,APN No. 156-163-10 and Car Prep hie, APN No. 156-163-09 The
District's negotiators are Jim Herberg, Lorenzo Tyner, and Rob Thompson. Said closed session
will be held pursuant to authority of California Government Code Section 54956.8.
Respec submitted,
By:
Bradley P.Hogin, G eral Counsel
1411299.1
ORANGE COUNTY SANITATION DISTRICT
COMMON ACRONYMS
ACWA Association of California LAFCO Local Agency Formation RWQCB Regional Water Quality
Water Agencies Commission Control Board
APWA American Public Works LOS Level Of Service SARFPA Santa Ana River Flood
Association Protection Agency
AQMD Air Quality Management MGD Million Gallons Per Day SARI Santa Ana River
District Interceptor
ASCE American Society of Civil MOU Memorandum of SARWQCB Santa Ana Regional Water
Engineers Understanding Quality Control Board
BOD Biochemical Oxygen Demand NACWA National Association of Clean SAWPA Santa Ana Watershed
Water Agencies Project Authority
California Air Resources National Environmental Supervisory Control And
CARB Board NEPA Policy Act SCADA Data Acquisition
California Association of Non-Governmental Southern California
CASA Sanitation Agencies NGOs Organizations SCAP Alliance of Publicly Owned
Treatment Works
CCTV Closed Circuit Television NPDES National Pollutant Discharge SCAQMD South Coast Air Quality
Elimination System Management District
CEQA California Environmental NWRI National Water Research SOCWA South Orange County
Quality Act Institute Wastewater Authority
CIP Capital Improvement O&M Operations&Maintenance SRF Clean Water State
Program Revolving Fund
California Regional Water Orange County Council of Sewer System
CRWQCe Quality Control Board OCCOG Governments SSMP Management Plan
CWA Clean Water Act OCHCA Orange County Health Care SSO Sanitary Sewer Overflow
Agency
California Water Environment Orange County Sanitation State Water Resources
CWEA Association OCSD District SWRCe Control Board
EIR Environmental Impact Report OCWD Orange County Water District TDS Total Dissolved Solids
EMT Executive Management Team COBS Ocean Outfall Booster Station TMDL Total Maximum Daily Load
EPA US Environmental Protection OSHA Occupational Safety and 7S5 Total Suspended Solids
Agency Health Administration
Professional Waste Discharge
FOG Fats,Oils,and Grease PCSA Consultant/Construction WDR Wastee Discharge
Services Agreement
gpd gallons per day PDSA Professional Design Services WEE Water Environment
Agreement Federation
GWRS Groundwater Replenishment POTW Publicly Owned Treatment WERE Water Environment&
System Works Reuse Foundation
ICS Incident Command System ppm pans per million WIFIA Water Infrastructure
Finance and Innovation Act
Integrated Emergency Professional Services Water Infrastructure
IERP Response Plan PSA Agreement WIIN Improvements for the
Nation Act
JPA Joint Powers Authority REP Request For Proposal WRDA Water Resources
Develo ment Act
ORANGE COUNTY SANITATION DISTRICT
GLOSSARY OF TERMS
ACTIVATED SLUDGE PROCESS—A secondary biological wastewater treatment process where bacteria reproduce at a high
rate with the introduction of excess air or oxygen and consume dissolved nutrients in the wastewater.
BENTHOS —The community of organisms, such as sea stars, worms, and shrimp, which live on, in, or near the seabed, also
known as the benthic zone.
BIOCHEMICAL OXYGEN DEMAND (BOD)—The amount of oxygen used when organic matter undergoes decomposition by
microorganisms.Testing for BOD is done to assess the amount of organic matter in water.
BIOGAS—A gas that is produced by the action of anaerobic bacteria on organic waste matter in a digester tank that can be used
as a fuel.
BIOSOLIDS—Biosolids are nutrient rich organic and highly treated solid materials produced by the wastewater treatment process.
This high-quality product can be recycled as a soil amendment on farmland or further processed as an earth-like product for
commercial and home gardens to improve and maintain fertile soil and stimulate plant growth.
CAPITAL IMPROVEMENT PROGRAM (CIP) — Projects for repair, rehabilitation, and replacement of assets. Also includes
treatment improvements,additional capacity, and projects for the support facilities.
COLIFORM BACTERIA—A group of bacteria found in the intestines of humans and other animals, but also occasionally found
elsewhere,used as indicators of sewage pollution. E.coli are the most common bacteria in wastewater.
COLLECTIONS SYSTEM — In wastewater, it is the system of typically underground pipes that receive and convey sanitary
wastewater or storm water.
CERTIFICATE OF PARTICIPATION (COP)—A type of financing where an investor purchases a share of the lease revenues of
a program rather than the bond being secured by those revenues.
CONTAMINANTS OF POTENTIAL CONCERN (CPC) — Pharmaceuticals, hormones, and other organic wastewater
contaminants.
DILUTION TO THRESHOLD (Dfr)—The dilution at which the majority of people detect the odor becomes the D/T for that air
sample.
GREENHOUSE GASES (GHG)— In the order of relative abundance water vapor, carbon dioxide, methane, nitrous oxide, and
ozone gases that are considered the cause of global warming("greenhouse stil .
GROUNDWATER REPLENISHMENT SYSTEM(GWRS)—Ajoint water reclamation project that proactively responds to Southern
California's current and future water needs.This joint project between the Orange County Water District and the Orange County
Sanitation District provides 70 million gallons per day of drinking quality water to replenish the local groundwater supply.
LEVEL OF SERVICE(LOS)—Goals to support environmental and public expectations for performance.
N-NITROSODIMETHYLAMINE (NDMA) — A N-nitrosamine suspected cancer causing agent. It has been found in the
Groundwater Replenishment System process and is eliminated using hydrogen peroxide with extra ultra-violet treatment.
NATIONAL BIOSOLIDS PARTNERSHIP (NBP)—An alliance of the National Association of Clean Water Agencies and Water
Environment Federation, with advisory support from the US Environmental Protection Agency. NBP is committed to developing
and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance
and promote public participation to enhance the credibility of local agency biosolids programs and improved communications that
lead to public acceptance.
PLUME—A visible or measurable concentration of discharge from a stationary source or fixed facility.
PUBLICLY OWNED TREATMENT WORKS(POTW)—A municipal wastewater treatment plant.
SANTA ANA RIVER INTERCEPTOR(SARI) LINE—A regional brine line designed to convey 30 million gallons per day of non-
reclaimable wastewater from the upper Santa Ana River basin to the ocean for disposal,after treatment.
SANITARY SEWER— Separate sewer systems specifically for the carrying of domestic and industrial wastewater. Combined
sewers carry both wastewater and urban runoff.
SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT (SCAQMD)—Regional regulatory agency that develops plans and
regulations designed to achieve public health standards by reducing emissions from business and industry.
SECONDARY TREATMENT— Biological wastewater treatment, particularly the activated sludge process, where bacteria and
other microorganisms consume dissolved nutrients in wastewater.
SLUDGE—Untreated solid material created by the treatment of wastewater.
TOTAL SUSPENDED SOLIDS(TSS)—The amount of solids floating and in suspension in wastewater.
TRICKLING FILTER—A biological secondary treatment process in which bacteria and other microorganisms,growing as slime
on the surface of rocks or plastic media,consume nutrients in wastewater as it trickles over them.
URBAN RUNOFF—Water from city streets and domestic properties that carry pollutants into the storm drains, rivers, lakes, and
oceans.
WASTEWATER—Any water that enters the sanitary sewer.
WATERSHED—A land area from which water drains to a particular water body.The Orange County Sanitation District's service
area is in the Santa Ana River Watershed.