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2013-18 Landmark Golf Management - SilverRock Management & Lease Agr
GOLF COURSE MANAGEMENT AGREEMENT BY AND BETWEEN CITY OF LA QUINTA W LANDMARK GOLF MANAGEMENT, LLC -1- GOLF COURSE MANAGEMENT AGREEMENT THIS GOLF COURSE MANAGEMENT AGREEMENT ("Agreement") is made and entered into this I Sk day of JK% , 2013 ("Effective Date") by and between the CITY OF LA QUINTA, a municipal corporation ("City"), and Landmark Golf Management, LLC, a California limited liability company ("Manager"). RECITALS Whereas, the City is responsible for the development and operation of the SilverRock Golf Course, located in the City of La Quinta, California, consisting of an initial 18-hole golf course, a driving range, clubhouse, pro shop, and maintenance facility (collectively, the "Golf Course"); and Whereas, the City desires to utilize the services of Manager to manage the Golf Course operations upon the terms and conditions set forth in this Agreement. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, City and Manager hereby agree as follows: 1.0 DEFINITIONS As used in this Agreement, the following terms shall have the respective meanings indicated below: 1.1 Annual Plan. The Annual Plan is as described in Section 3.2. 1.2 Capital Improvement Fund. The funds to be held by the City pursuant to Section 3.10.1. 1.3 Capital Improvements. Any alteration, addition, improvement, repair, replacement, rebuilding, or renovation to the Golf Course which exceeds a cost of Two Thousand Five Hundred Dollars ($2,500.00)• 1.4 City. The City of La Quinta, a municipal corporation. 1.5 City Council. The City Council of the City of La Quinta. 1.6 City Manager. The person holding the position of City Manager of the City, or his or her authorized designee, including but not limited to the Project Manager. 1.7 Intentionally Omitted. 1.8 Cost of Sales. All monies expended by Manager for the purchase of -2- consumable items at the Golf Course, including but not limited to food and beverages (including liquor) and Pro Shop merchandise adjusted for beginning inventories, ending inventories, sales returns, and allowance of such items. 1.9 Employee Compensation. The direct salaries and wages paid to or accruing for the benefit of the management staff and all other persons employed by Manager at the Golf Course, together with all fringe benefits payable to or accruing for the benefit of such employees, including employer's contribution under the Federal Insurance Contributions Act ("FICA"), unemployment compensation, or other employment taxes, pension fund contributions, worker's compensation, group life and accident and health insurance premiums, profit sharing, retirement, disability and other similar benefits, as determined by Manager and as set forth in the approved Annual Plan. 1.10 Furnishings and Equipment. All furniture, furnishings, trade fixtures, apparatus and equipment, including without limitation course maintenance vehicles and equipment, golf carts, driving range pickers and pullers, mats, range ball baskets, cash registers, rental golf clubs and bags, ball washers, benches, uniforms, kitchen equipment, appliances, china, glassware, silverware, office equipment, computers, copy machines, facsimile machines, telephone systems,' and other personal property used in or held in storage for use in the operation of the Golf Course, other than "Operating Inventory," as defined in Section 1.22. 1.11 Golf Course Expenses. The total of (a) all expenses specifically identified as "Golf Course Expenses" in this Agreement; and (b) those expenses which if assumed by Manager would be inconsistent with the role of a Golf Course Manager, provided that any such unplanned expense not included in the Annual Plan which exceeds Ten Thousand Dollars ($10,000.00) must have prior written approval from the City Manager, and are subject to the expenditure limits set forth in Section 3.2.2. Golf Course Expenses shall not include any expenses of Manager's corporate office, or any services rendered by Manager's corporate offices for or to the Golf Course or the management thereof, or the compensation of any corporate or regional employee of Manager. 1.12 Golf Course Operations and Maintenance Evaluation Form. The form, attached to this Agreement as Exhibit "B", to be used to evaluate Manager's adherence to the Golf Course Operations and Maintenance Standards. 1.13 Golf Course Operations and Maintenance Standards. Those maintenance standards set forth in Exhibit "A" to this Agreement which may be modified from time to time by mutual written agreement of the City Manager and Manager's. representative identified in Section 11.1 1.14 Gross Revenues. For the purposes of this Agreement, the term "Gross Revenues" means, except as provided below, all money received as a result of the operation of the Golf Course and the sale of goods and services at the Golf Course, -3- determined on an accrual basis in accordance with generally accepted accounting principles consistently applied. By way of example, and without limitation, Gross Revenues shall include all green fees; rental fees for golf carts, golf clubs and bags, and other rental items; bag storage fees; range balls; reservation fees; fees for golf handicap service; rental and concession payments; revenue generated from space rentals and from meetings, banquets, parties, receptions, tournaments, and other group gatherings; golf instruction fees; revenues from golf schools; proceeds from business interruption insurance; and Resident Cards. Gross Revenues shall be reduced by any cash refunds or credits allowed on returns by customers. Gross Revenues shall not include the following: (a) Sales taxes, excise taxes, gross receipts taxes, and other similar taxes now or later imposed upon the sale of food, beverages, merchandise or services and paid to the appropriate taxing authority, whether added to or included in the selling price; (b) Receipts in the form of refunds from, or the value of merchandise, supplies or equipment returned to, shippers, suppliers, or manufacturers; (c) The amount of any gratuities paid or given by customers to Golf Course employees; (d) Gross receipts received by licensees or concessionaires, except to the extent any portion of such receipts is received by the Golf Course; (e) Proceeds of insurance other than business interruption insurance or similar types of insurance; (f) Receipts from public telephones and vending machines, except to the extent of commissions paid to Manager or City; (g) Proceeds of any borrowings by Manager or City; (h) Any amount received by Manager in connection with any claim, demand, or lawsuit, except when such amount is for (i) interruption or loss of Golf Course business, or (ii) punitive damages relating to conduct occurring at the Golf Course; and (i) Any additional funds provided by the City for, or paid by the City for, any Golf Course purpose. 1.15 Impositions. All taxes and assessments (including without limitation real property taxes and assessments, possessory interest taxes, and personal property taxes), water, sewer or other similar rents, rates and charges, levies, license fees, permit fees, inspection fees and other authorization fees and charges, which at any -4- time may be assessed, levied, confirmed or imposed on the Golf Course or the operation of the Golf Course. 1.16 Index. The Consumer Price, Index for All Urban Consumers for Los Angeles - Anaheim - Riverside (1982-84 equals 100) as published by the United States Department of Labor, Bureau of Labor Statistics. 1.17 Insurance Requirements. All requirements of each insurance policy, and all orders, rules, regulations and other requirements of the City and of National Board of Fire Underwriters (or any other body exercising similar functions), applicable to the Golf Course or the operation of the Golf Course. 1.18 La Quinta Resident. Residency is determined by a person's primary residence according to the California Vehicle Code, Section 1205 or proof of ownership of a residential dwelling in La Quinta as supported by a Riverside County Tax Assessor record, as defined in Resolution 2004-137 adopted by La Quinta City Council on November 16, 2004. 1.19 Legal Requirements. All laws, statutes, ordinances, orders, rules, regulations, permits, licenses, authorizations, directives and requirements of governments and governmental authorities, which now or hereafter may be applicable to the Golf Course or the operation of the Golf Course. 1.20 Manager. Landmark Golf Management, LLC, a California limited liability corporation. 1.21 Notice of Golf Course Deficiency. The form attached to this Agreement as Exhibit "C" to be used to notify Manager of Deficiency Items (as that term is defined in Section 3.8.1). 1.22 Operating Inventory. Consumable items used in or held in storage for use in the operation of the Golf Course, including scorecards and cart tickets, driving range balls, golf pro shop merchandise, food and beverage inventory, kitchen supplies, paper and plastic ware, locker room and bathroom supplies, towels, fuel, cleaning materials, fertilizers, pesticides, seed, maintenance parts and supplies, office supplies, and other similar items all of which shall be deemed the property of the City at all times and under all circumstances. 1.23 Operating Year. An Operating Year shall be a twelve (12) month period during the term of this Agreement commencing on July 1 and continuing through and including the following June 30. 1.24 Project Manager. The individual designated by the City Manager to serve as the "Project Manager" pursuant to Section 1 1.1, or his or her authorized designee. 1.25 Weekends. The period commencing at 12:01 a.m. Friday and ending at -5- 11:59 p.m. on Sunday. 2.0 TERM OF AGREEMENT 2.1 Effective Date; Term. City is contracting with Manager, pursuant to this Agreement, for provision by Manager of Golf Course management services. This Agreement shall be effective on the Effective Date set forth in the preamble, which date shall be the beginning of the "Management Term" set forth in Section 2.2. 2.2 Management Term. The Management Term shall commence July 1, 2013. The Management Term and this Agreement shall end on the date that is the fifth (51") anniversary (June 30) of the Management Term Commencement Date provided, however, the Management Term may be terminated by the City, in its sole discretion, without penalty or cause at the end of the third year of the Management Term if such earlier termination is deemed necessary in the reasonable opinion of Bond Counsel to maintain the tax exempt status of municipal bonds issued to fund a portion of the Golf Course pursuant to Section 1 .141- 3(b)(4) of the Regulations promulgated pursuant to the Internal Revenue Code of 1986, as amended, Revenue Proclamation 97-13, Revenue Proclamation 2001-31 and other relevant statutes, regulations and proclamations. 3.0 GOLF COURSE OPERATIONS AND MANAGEMENT 3.1 Management of the Golf Course by Manager. City hereby contracts with Manager, during the Management Term, to manage and operate the Golf Course pursuant to the terms of this Agreement, and Manager agrees it shall manage and operate the Golf Course in such manner. Subject to the terms of this Agreement, Manager shall have authority and responsibility to: (a) implement the policies and standards for the Golf Course as determined by the City; (b) manage and supervise all day-to-day operations of the Golf Course including starting, course marshals, pro shop, building and course maintenance, security, cart rental, driving range, food and beverage service, golf instruction, and administration/management; (c) subject to Section 3.5.2, set, from time to time, fees and charges for other uses and items charged to Golf Course customers, provided that such fees and charges shall be competitive with fees and charges imposed or charged by comparable golf courses in The Coachella Valley; (d) hire, train, and supervise all employees required to carry out Manager's responsibilities, including without limitation the General Manager and Golf Course Superintendent; (e) acquire all goods and services necessary to carry out Manager's responsibilities; (f) acquire all necessary licenses and permits for the operation of the Golf Course including related to food preparation and alcoholic beverages; (g) manage all course reservations, tee times, and tournaments; (h) manage all marketing and promotional activities and customer service relations; (i) manage accounting and payroll procedures and functions; and (j) prepare such annual and other plans and reports as set forth in this Agreement. City agrees it shall cooperate with Manager to permit and assist Manager to carry out its duties under this Agreement. -6- 3.2 Annual Plan. 3.2.1 Preparation and Approval. Manager shall submit to the City Manager, annually on or before April 1 of each year, the Annual Plan for the Golf Course for the next Operating Year ("Annual Plan"). The Annual Plan shall include a monthly operating budget containing bona fide good faith estimates of all Golf Course Expenses for the next Operating Year, including expenditures for (a) property operation and maintenance, (b) repairs, replacements, and alterations which do not constitute Capital Improvements, (c) Furnishings and Equipment and Operating Inventory, (d) salaries, and (e) advertising, sales, and business promotion. The Annual Plan shall also include the course maintenance plan and the marketing and business plan for the Golf Course for the next Operating Year. The parties agree that they shall use their best efforts to limit the increase in total Golf Course Expenses during the term of this Agreement to the increase in the Index. Any increase in excess of the increase in the Index shall be thoroughly documented in the Annual Plan. The parties understand that, as provided in Section 3.10 of this Agreement, recommendations and budgets for Capital Improvements will be treated separately and will not form part of the Annual Plan. The Annual Plan shall be subject to the prior written approval of the City Council. The Project Manager and City Manager agree to examine each Annual Plan submitted by Manager and to work with Manager to develop an Annual Plan that can be forwarded to the City Council with a positive recommendation from the Project Manager and City Manager; provided, however, that Manager is not required to obtain the approval of the Project Manager and City Manager before submitting the Annual Plan to the City Council. It is contemplated by the parties that the Annual Plan will be agreed upon by Manager and City Council not later than sixty (60) days following delivery of the Annual Plan by Manager to the City Council. If the City Council fails to either approve the Annual Plan within said 60-day period or to advise Manager in writing of its objections to the Annual Plan within such period, then the City Council shall be deemed to have disapproved the Annual Plan as submitted. In the event that the City Council fails to approve the Annual Plan, pending the resolution of such dispute, Manager shall continue to manage and operate the Golf Course in accordance with the standards set forth in this Agreement at a level of expenditures comparable to those of the preceding Annual Plan multiplied by the Index percentage. This Index Percentage shall apply to actual Golf Course Expenses, and shall neither include any expenditure not authorized as a Golf Course Expense pursuant to this Agreement nor the Management Fee. IVA 3.2.2 Compliance. Manager shall comply with the applicable Annual Plan. Without the prior written consent of City Manager (which consent shall not be unreasonably withheld), the actual amount expended per any calendar quarter for Golf Course Expenses shall not be greater than ten percent (10%) higher than the amount budgeted for that calendar quarter in the Annual Plan. Any expenditure made by City and/or Manager Golf Course Expenses in excess of 110% of the amount budgeted for that calendar quarter in the Annual Plan shall constitute a material breach of this Agreement by Manager unless prior approved by the City Manager. In addition, and as a separate material obligation, without the prior written consent of City Manager (which consent shall not be unreasonably withheld), the actual amount expended per any fiscal year for Golf Course Expenses shall not be greater than two percent (2%) higher than the amount budgeted for that fiscal year in the Annual Plan. Any expenditure made on Golf Course Expenses in excess of 102% of the amount budgeted for that fiscal year in the Annual Plan shall constitute a material breach of this Agreement by Manager unless prior approved by the City Manager. Notwithstanding the foregoing sentence, Manager shall be entitled to make additional expenditures not authorized under the then applicable Annual Plan in the event of an emergency or in order to comply with any applicable Insurance Requirements or Legal Requirements. 3.2.3 Monthly Review of Monthly Financial Report (P&L). The City Manager or designee and the General Manager of the Golf Course shall meet and discuss the operating results of the P&L. Manager shall provide, in writing, an explanation for variances from the approved Annual Plan by revenue and expense categories of at least One Thousand Dollars ($1,000) and that are greater than Ten Percent (10%) of the budgeted amount. Neither City nor Manager shall be under legal obligation to approve any modifications to the Annual Plan. Any material amendments or revisions to the Annual Plan shall require the prior approval of the City Council. 3.3 Responsibilities of Manager. Without in any way limiting Manager's right to manage and operate the Golf Course in accordance with the terms of this Agreement, Manager shall, in addition to other obligations and responsibilities set forth in this Agreement, perform the following services, or cause the same to be performed for the Golf Course, and all expenditures of Manager and costs and expenses incurred by Manager in performing these services, including the "Management Fees" (as defined in Section 4.1) shall be Golf Course Expenses: (a) consummate arrangements with concessionaires, licensees, tenants, or other intended users of the Golf Course; (b) enter into such contracts for the furnishing of utilities and maintenance and other services to the Golf Course, subject to Section 3.6; (c) make all repairs, decorations, replacements, additions, revisions, alterations and improvements to the Golf Course as shall be reasonably necessary for maintenance of the Golf Course in good order, condition and repair, subject to the terms of this Agreement; (d) incur such expenses as shall be necessary for the proper operation and maintenance of the Golf Course, including without limitation rental expenses for leased Furnishings and Equipment pursuant to the Golf Course Maintenance Standards; (e) assist the City in determining and obtaining the Inventory for Golf Pro Shop and then maintain a level of Operating Inventory deemed appropriate by Manager for supplying the needs of the Golf Course and its customers; (f) apply for, and use its best efforts to obtain and maintain, all licenses and permits required of Manager in connection with the operation and management of the Golf Course; and City agrees to execute any and all applications and such other documents as shall be reasonably required and to otherwise cooperate, in all reasonable respects, with Manager in the application for, and obtaining and maintenance of, such licenses and permits; (g) use its best efforts to do, or cause to be done, all such acts and things in and about the Golf Course as shall be reasonably necessary to comply with all Insurance Requirements and Legal Requirements; (h) pay all Impositions (including but not limited to any sales and/or use tax resulting from the performance of Manager consistent with this Agreement) and insurance premiums when due; (i) implement a marketing, advertising, and promotional plan for the Golf Course; (j) purchase Furnishings and Equipment necessary to operate and maintain the Golf Course in the manner provided in this Agreement; (k) maintain the landscaping within the boundaries of the Golf Course; and (1) defend and settle claims, lawsuits, and demands relating to the Golf Course and Golf Course personnel (as further provided in and subject to Section 3.12 below), and retain legal counsel (and pay legal fees and costs) who under the direction of Manager will represent City, Manager, and the Golf Course on all questions relating to Legal Requirements, will defend any claims or actions brought against Manager or City relating to the Golf Course or Golf Course personnel, and will institute and defend any and all legal actions or proceedings as shall be reasonably necessary to collect charges, -9- rent or other income for the Golf Course to dispossess tenants or other persons in possession from all or any portion of the Golf Course, to cancel or terminate any lease, license or concession agreement on the grounds of default by the tenant, licensee, or concessionaire, or to contest property taxes. Manager shall notify City of any claims or a lawsuits relating to the Golf Course within three (3) business days after Manager receives notice of such claims or lawsuits. Any legal fees paid by Manager and charged as a Golf Course Expense shall be for legal services directly related to the Golf Course and shall not include any Manager corporate overhead or administrative fee or charge. The City Manager shall have the right to pre - approve any legal counsel retained by Manager to defend the City, and to approve all legal bills incurred in such defense. Manager shall neither settle nor otherwise resolve any claims or lawsuits without the prior written approval of the City Manager. 3.4 Personnel. 3.4.1 General. Subject to Section 3.4.4, Manager shall employ all of the employees of the Golf Course. Manager shall recruit, hire, train, discharge, promote and supervise the management staff of the Golf Course (i.e., the General Manager, the Golf Course Superintendent, and other key personnel), and Manager shall supervise through the management staff the recruiting, hiring, training, discharge, promotion and work of all other employees of the Golf Course. All employees of the Golf Course shall be bonded, as determined necessary by the City, and properly qualified for their positions. The employee compensation of the management staff and all other Golf Course employees shall be a Golf Course Expense. 3.4.2 Pension and Benefit Plans. Manager shall have the right to provide eligible employees of the Golf Course with pensions and other employee retirement benefits and disability, health and welfare benefits, and other benefit plans now or hereafter available to employees of other golf courses and country clubs operated by Manager, and the allocable share, as set forth in the Annual Plan, of such employee benefits shall be a Golf Course Expense. 3.4.3 Temporary Assignment of Other Manager Personnel. If the position of General Manager, Golf Course Superintendent, or other key management positions of the Golf Course are not filled for whatever reason, Manager may temporarily assign to these positions the staff of other golf courses and country clubs operated by Manager or other qualified Manager staff; provided, however, that said temporary assignment shall not exceed ninety (90) days without the written approval of the City Manager. During such time as these employees are temporarily assigned to the Golf Course, all such employees will be paid their regular Employee Compensation, and the pro-rata share of such Employees' Compensation equal to the actual time -10- such employees worked at the Golf Course shall be a Golf Course Expense. 3.4.4 Management Staff. The General Manager of the Golf Course shall be responsible for the day to day management and operation of the Golf Course. The name and telephone number (both personal and business) of the General Manager shall be provided, in writing, to the City Manager and shall be current at all times. The General Manager shall be reasonably available during normal working hours to meet with the City Manager. After normal working hours, the General Manager shall be reasonably available to appear at the Golf Course if deemed necessary by the City Manager. The Golf Course Superintendent for the Golf Course shall be certified by the Golf Course Superintendents Association of America. However, the City Manager shall have the right to waive the certification requirements on a case -by -case basis and allow the selection of a qualified superintendent that may not yet be certified. The General Manager shall be a current Class "A" member in good standing of the Professional Golf Association America or the Ladies Professional Golf Association. The City Manager shall have the right to approve the individuals who Manager intends to hire to fill the positions of General Manager and Golf Course Superintendent(regardless of the titles given for such positions by Manager), which approval shall not be unreasonably withheld. 3.5 Specific Operating Procedures. In addition to the more general responsibilities of Manager as manager of the Golf Course as provided in this Article 3.0, Manager shall operate and manage the Golf Course in accordance with the following operating procedures consistent with the approved Annual Plan. 3.5.1 Golf Course Hours of Operation. Except upon the occurrence of the events described in Article 10.0 of this Agreement, the Golf Course shall be operated on a daily basis all year and shall not be closed on holidays. The Golf Course shall be kept open during all hours necessary to adequately serve the public utilizing the Golf Course, except for instances in which scheduled construction and normal maintenance requires temporary closure. The driving range may be open when the Golf Course is closed. The inside food and beverage services of the Golf Course Clubhouse shall be open all year, except as otherwise approved by the City Manager. The permitted hours for food and beverage services in the clubhouse restaurant shall be consistent with similar facilities in the Coachella Valley. 3.5.2 Fees and Charges. 3.5.2.1 Setting of Fees. City Council shall, from time to time, set the amount for fees and charges for greens fees (which shall include use of a golf cart) and the driving range. All other fees, charges, and prices at the Golf Course, including the Pro Shop and the Clubhouse, shall be set by Manager and shall be comparative and competitive -11- with other first class public golf courses in Riverside County. City shall at all times consult with Manager in setting fees and charges. 3.5.2.2 Resident Green Fee Discount. The City Council has established a "Resident Green Fee Discount," whereby La Quinta residents shall receive a discount on daily play green fees. The City Council shall set the terms and amounts of the resident green fee discount. Manager shall develop all necessary rules and procedures for implementing the Resident Green Fee Discount, which rules and procedures shall be subject to the prior written approval of the City Manager. 3.5.3 Reservation of Golf Rounds. Manager shall establish a system for advance reservations of golf tee times, including a preferential tee time reservation method for residents of the City and guests of hotels/motels/etc. located within the City, as determined by the City Council. 3.5.4 Dress Code. Bathing attire, cut-offs and short shorts, halter tops, tube tops, tank tops, running outfits, and similar types of recreational wear are not considered proper dress on the Golf Course and shall not be permitted. Shirts and shoes shall be worn at all times at the Golf Course. Men's shirts shall have collars and sleeves. This dress code shall apply to all visitors, golfers, and employees, including independent contractors hired by Manager to provide golf instruction, marshalling service, starter service, pro shop or food beverage sales, etc. 3.5.5 Handicap Service. During the Management Term of this Agreement, Manager shall provide at the Golf Course a golf handicap service to both men and women golfers who patronize the Golf Course. The fee charged to golfers by Manager for such handicap service shall be an annual fee and shall not exceed two times the fee charged to the Golf Course by Southern California Golf Association or United States Golf Association, as the case may be, for providing the handicap service. Manager shall not collect annual fees for the handicap service for any annual period that commences after the expiration of the term of this Agreement. The handicap service shall not include as part of its benefits any privileges to use the Golf Course, other than the privileges otherwise available to the general public. 3.5.6 Starter Service and Marshals. Starter services shall be provided and shall include the assignment of tee times and carts and the collection of fees. While the Golf Course is open for play, marshals shall closely monitor and control the speed of play and assist the slower golfers in order to maintain golf play at acceptable levels. 3.5.7 Golf Club Pick -Up. Pick-up and delivery of golf clubs and bags to and from the clubhouse entrance shall be provided when requested by a Golf -12- Course customer. There shall be no charge to the Golf Course customers for golf club pickup and delivery. Appropriate Golf Course employees may accept gratuities from customers for such services. 3.5.8 Club Cleaning. Golf club cleaning services shall be provided to golfers immediately upon their completion of golf play. There shall be no charge to the golfers for golf club cleaning services. Appropriate Golf Course employees may accept gratuities from golfers for such services. 3.5.9 Tee Times. The tee times for the Golf Course shall be scheduled at no more than eight (8) tee reservation times per hour. 3.5.10 Playing Pace• Fivesome Play. Manager and City agree that fivesome play should be permitted only in unusual circumstances, but when permitted no more than two (2) fivesomes per hour on the Golf Course shall be allowed. The play of all players, including all fivesomes, shall be closely monitored, and the Golf Course marshals shall enforce playing time requirements to maintain a playing pace that insures eight (8) tee times per hour. 3.5.11 Tournaments. Consecutive tee times, shotgun starting formats, and modified shotgun starting formats shall be acceptable forms of reservations for tournaments. During the appropriate seasons and provided the weather conditions permit such an arrangement, when a full shotgun (use of all 18 holes) starting procedure is used, it shall be timed in such a manner so as to potentially accommodate two (2) full shotguns per day —one in the morning and one in the afternoon. Manager shall take all actions necessary to accommodate a scheduled tournament, including but not limited to course preparation, player scorecards, food service, and other customary services reasonably requested by tournament organizers and appropriate for tournament play. Manager may charge additional fees for unusual or special services. Manager shall notify the City in advance of brooking weekend tournaments. 3.5.12 Golf Pro Shop. The Golf Course Pro Shop shall be open every day at the same hours that the Golf Course is open for play unless otherwise approved in writing by City Manager. Manager may employ merchandise sales personnel to work in the Pro Shop when it is open for business. Manager shall evaluate the necessity of engaging a qualified Merchandise Manager for the Pro Shop who would be responsible for promoting and increasing sales at the Pro Shop, and, if necessary, shall employ such a Merchandise Manager. Merchandise that can reasonably be classified as "stale" or "unsellable" may be marked down. No merchandise shall be sold or otherwise alienated at below its cost of acquisition without the prior written approval of the City Manager. If Manager determines that any aged merchandise in the Pro Shop should not be sold, whether on a discounted -13- basis or otherwise, because of the reputation or image of the Pro Shop, then with the City Manager's approval Manager may purchase with its own funds (and not from the Golf Course Accounts) such merchandise at cost for purposes of selling such merchandise at other golf courses operated by Manager. Space shall be provided in the Pro Shop for merchandise that City may develop as part of its marketing and public relations programs, including but not limited to such items as t-shirts, polo shirts, sun visors, license plate frames, coffee cups, and golf balls. Manager shall perform quarterly inventories of the Pro Shop operating inventory. 3.5.13 Golf Instruction. Manager shall either employ or shall retain as independent contractors golf instructors to provide golf lessons and golf instruction at the Golf Course. All golf instructors must be certified PGA or LPGA golf professionals or apprentices. All golf instruction fees are deemed Gross Revenues and shall be handled as a cash register transaction and reported in the same manner as green fees. Manager shall develop a golf instructional program that will offer individual and group lessons, video instruction, golf clinics, junior golf clinics, and golf schools. A golf professional shall only be allowed to conduct golf lessons at the Golf Course if he or she has first obtained the approval to do so by Manager. 3.5.14 Golf Driving Range. The driving range shall be open during hours of Golf Course operation. Driving range balls shall be of the highest quality, and all cracked and worn range balls shall be removed daily. A fee shall be charged for use of the driving range; provided, however, that at Manager's discretion, a certain amount of driving range balls as determined by Manager may be provided at no additional cost to those golfers who have paid green fees on that day or have purchased instructional lessons. 3.5.15 Golf Club Rentals. Quality rental golf clubs, both left-handed and right-handed, and bags shall be available for rental to customers of the Golf Course at a fee to be determined from time to time by Manager. 3.5.16 Golf Carts. Golf carts shall be provided to all golfers on the Golf Course as part of the green fee. Use of the golf cart by the golfer(s) shall be optional but may be required by Manager or designee if, on a particular day or during part of a particular day, use of golf carts is necessary to maintain satisfactory playing pace or for reasons of safety or other reasons related to the quality of play and maintenance of the Golf Course. Manager shall not permit the use of private golf carts on the Golf Course. Manager shall provide a sufficient number of electrically -powered golf carts to accommodate players. Golf carts shall be new when purchased or leased and shall be manufactured by a reputable firm. Manager shall use GPS systems on the Golf Course, and incorporating such technology as a feature on the golf cart. The entire golf cart fleet shall be replaced with new units at least every five (5) years. A three-year replacement may be appropriate with -14- a three-year lease agreement. All golf carts shall be 4-wheel vehicles, and shall be equipped with canopies, sand and seed containers, and holders. At the election of the City Manager, Manager shall either (a) employ a full time on -site mechanic who is qualified to repair and maintain the golf carts, or (b) enter into an agreement (with a term not to exceed one (1) year) with a qualified independent golf cart service company approved by the City Manager, provided that in either event the golf carts shall be properly maintained and in sufficient operational condition to assure the full and unhindered availability of the golf course. An ADA compliant golf cart must be available to eligible golfers within 48 hours notice. 3.5.17 Food and Beverage Operations. The Golf Course shall include a restaurant located in the clubhouse, beverage cart service, and a snack bar which shall be operated in accordance with specifications promulgated by the City. Temporary fixed food stands shall not be installed on the Golf Course except for special events. Manager shall provide a staffed food service and beverage cart for the service of players on the Golf Course during peak hours of operation. Manager shall comply with all requirements of state and local law governing the sale and distribution of alcoholic beverages. Manager shall obtain and maintain all permits from all governmental agencies having jurisdiction for all food and beverage operations at the Golf Course. Manager shall comply with all health law and regulations as existing or as may be established by the federal, state, county, and city governmental agencies. All food service employees shall possess valid food handler cards, and a copy of these cards shall be maintained in the administrative office at the Golf Course. Manager, for all food and beverage employees, shall comply with all applicable codes and regulations as relates to tuberculosis and other health and disease testing as now or hereafter required by applicable law. Prices of food and beverages sold at the Golf Course shall be market rate and competitive with prices charged at comparable first class public golf courses in the Coachella Valley. 3.5.18 Office Operations. Manager shall employ sufficient administrative staff at the Golf Course to permit Manager to competently perform Manager's obligations under this Agreement. Upon City's written request, Manager shall provide the City Manager with a written job description for each management position at the Golf Course. The City Manager shall keep these job descriptions in strict confidence, subject to applicable public records disclosure laws. Manager shall maintain at the Golf Course copies of all Manager corporate policies and procedures, as such may be changed from time to time. Manager shall provide the City with the most recent version of the manager's policies and procedures. 3.5.19 Safety and Security. The Golf Course shall comply with all safety -15- regulations of federal, state, and local governmental agencies, including without limitation any requirements imposed by California Labor Code Section 6300 et seq, and regulations promulgated with respect thereto, and applicable federal occupational, health, and safety laws and regulations. Manager shall take all reasonable actions to protect the safety of all Golf Course employees and customers. All employees with access to cash receipts shall be bonded pursuant to standards prescribed by the Finance Director. The Golf Course shall maintain appropriate security systems, including video monitoring of cash operations, security alarm systems, motion detection sensors for after-hours control, and locks for the maintenance yard and perimeter gates. The alarm system at the Golf Course shall be tied into an offsite monitoring station. Manager shall keep for thirty (30) days computer recordings for all accounts payable and accounts receivable information. All records at the Golf Course shall be kept in fireproof files. 3.5.20 Customer Evaluation Forms. Forms shall be available to customers of the Golf Course to present their comments or complaints regarding the Golf Course. Completed forms shall be collected on weekly basis and retained by Manager at the Golf Course for not less than one (1) year and made available to City upon request. 3.5.21 Scorecards. Manager shall provide scorecards printed specifically for the Golf Course. The scorecards shall carry the name (and logo) of the Golf Course as directed by the City pursuant to Article 6.0. The scorecards shall, at Manager's option, also include wording stating that the Golf Course is managed by Manager. 3.5.22 Junior Golf Program. Manager shall plan, implement, and supervise a "Junior Golf Program" for elementary school, middle school, junior high school, and high school aged La Quinta residents (i.e., high school -aged and below). The purpose of the Junior Golf Program is to encourage participation in golf, teach golfing skills and course etiquette, and promote competition and sportsmanship. The program shall include incentives for encouraging participation such as non -peak time green fee discounts, free clinics, discounts on golf lessons, use of the facility for La Quinta High School golf team practice/matches, etc. Manager shall incorporate the parameters of the Junior Golf Program as part of the Annual Plan. 3.6 Contracts and Agreements. All leases and financing agreements for Furnishings and Equipment, and all contracts and agreements relating to the operation and maintenance of the Golf Course (including without limitation golf professional contracts, contracts for maintenance and repair services, pest control, supplies, and landscaping services, and agreements for tournaments, banquets, and other group functions), entered into during the term of this Agreement shall be entered into by Manager as the contracting party and approved, as to form, -16- content, and vendor, by the City. Payments for all approved leases, financing agreements, contracts and otherwise (the "Assumed Agreements") are defined Golf Course Expenses. City agrees, upon expiration or termination of this Agreement, to assume all such agreements it has so approved. In the event that Manager has defaulted on its obligations under any such agreements City shall not be responsible for any scheduled payments due and owing before the termination or expiration of this Agreement and shall only be responsible for any scheduled payments due and owing after the date this Agreement is terminated or expires. 3.7 Alterations to Buildings. Manager shall not make any substantial alterations, additions, or changes to the clubhouse, golf pro shop, maintenance building, or other buildings located at the Golf Course without the prior consent of the City Manager. 3.8 Operations and Maintenance Standards. The parties acknowledge and agree that the Golf Course shall be operated and maintained as a first class golf course. As used herein, "first class golf course" shall mean a golf course comparable to the following golf courses in the Coachella Valley, as they existed on the Effective Date of this Agreement: Westin Mission Hills, Desert Willow, Indian Wells Resort, La Quinta Resort, and PGA West Courses. In addition to all other responsibilities of Manager under this Agreement, Manager agrees that at all times during the term of this Agreement; the Golf Course shall be operated and maintained in accordance with the standards set forth in the Golf Course Operations and Maintenance Standards consistent with the approved Annual Plan. Manager's failure, as measured by the process set forth in sections 3.8.1-3.8.2, to maintain the Golf Course in a manner consistent with this Section shall construe a material breach of this Agreement. 3.8.1 City Inspection and Evaluation. Each month during the term of this Agreement, the City Manager or Agent of the City Manager shall inspect the Golf Course for purposes of compliance with the Golf Course Operations and Maintenance Standards and this Section 3.8. In conducting such inspection and evaluation, the City Manager (or Agent) shall complete the Golf Course Operations and Maintenance Evaluation Form and shall promptly thereafter provide Manager a copy of the completed form or applicable portion thereof. City agrees that the City Manager (or Agent) shall act reasonably and in good faith in making the determination of whether the Golf Course Operations and Maintenance Standards, or applicable portion thereof, have been met. As set forth in Exhibit "B", the Golf Course Operations and Maintenance components shall be rated as "Acceptable," "Needs Improvement," and "Unacceptable." An overall rating using the same scale shall also be determined on a monthly basis. Notwithstanding Manager's obligation to correct Deficiency Items as set forth below and subject to Section 3.8.2 below, Manager shall be in compliance with the Golf Course Operations and Maintenance Standards unless an overall rating is determined to be "Unacceptable." The City Manager's rating of an item as -17- "Unacceptable" or "Needs Improvement" shall, upon Manager's receipt of the Golf Course Operations and Maintenance Evaluation Form, constitute a Notice of Golf Course Deficiency with respect to the deficient item(s). Within one (1) week after receipt of the Golf Course Operations and Maintenance Evaluation Form, the City Manager and General Manager of the Golf Course, and the Golf Course Superintendent if necessary, shall meet to review the Deficiency Item(s), including the corrective actions Manager intends to take to correct the Deficiency Item(s). Within three (3) working days thereafter, Manager shall complete the "Statement of Corrective Action" detailing the steps it intends to take to correct each Deficiency Item and the time schedule for completion of corrective action and submit the Statement of Corrective Action to the City Manager for written approval. Unless the City Manager states in writing otherwise, all deficiencies shall be corrected within seven (7) working days of the issuance of the Statement of Corrective Action, or if no Statement of Corrective Action is issued or approved by the City Manager, then ten (10) working days from the meeting described above. When a Deficient Item has been satisfactorily corrected in the judgment of the City Manager, the City Manager and the general manager of the Golf Course shall each sign the Notice acknowledging completion of the corrective action. The cost for correcting any Deficiency Item shall be a Golf Course Expense subject to the expenditure limitations set forth in Section 3.2.2. 3.8.2 Results of Manager's Failure to Take Corrective Action. Except as provided in Section 3.8.3 below, if Manager obtains an overall rating of "Unacceptable," or fails to take action to timely correct any Deficiency Item(s), the following shall occur: (a) If there are two (2) consecutive months in which the Golf Course Operations and Maintenance Evaluation Form indicates that Manager's management of the Golf Course has obtained an overall rating of "Unacceptable," the City shall be entitled to deduct from the Performance Evaluation Deposit described in Section 4.1.1, the amount of Five Thousand Dollars ($5000) per month, and such deduction amount shall be retroactive to the first IV) of the two (2) consecutive months and shall continue until Manager's management of the Golf Course achieves an overall rating of "Acceptable" as indicated on the Golf Course Maintenance Evaluation Form. In addition, any failure to achieve an overall rating of "Acceptable" for (i) any four (4) months within any single operating year, or (ii) any three (3) consecutive months, shall be considered a material breach of this Agreement entitling City to terminate this Agreement regardless of the deductions that have been made from the Performance Evaluation Deposit. (b) City shall further be entitled to deduct from the Performance -18- Evaluation the amount of Two Thousand Dollars ($2,000) per month for each Deficiency Item that is not timely corrected. Such deduction shall be imposed as of the date the Deficiency Item was to have been corrected and shall continue each month thereafter until such Deficiency Item has been corrected as indicated by the signature of the City Manager and General Manager of the Golf Course on the Notice of Golf Course Deficiency as described Section 3.8.1. The deductions provided for in this Section 3.8.2 shall not be a Golf Course Expense. 3.8.3 Exclusions from Imposition of Deductions. The following items shall be considered exclusions for the purpose of determining whether there have been two (2) consecutive months with overall ratings of "Unacceptable" and for the purpose of determining whether an outstanding Deficiency Item has been timely corrected: (a) any outstanding Deficiency Item that Manager is diligently and timely correcting in accordance with the time schedule jointly agreed to by the City Manager and the General Manager of the Golf Course as provided in Section 3.8.1; (b) any Deficiency Item in which the correction is considered a Capital Improvement but only if and to the extent Manager, in light of its expertise and experience as a manager of first class golf courses, could not have taken reasonable measures to prevent or mitigate the Deficiency Item from occurring; (c) any Deficiency Item that Manager is unable to correct because of the occurrence of a "Force Majeure Event" (as defined in Section 10.3 of this Agreement) but only to the extent Manager, in light of its expertise and experience as a manager of first class golf courses, could not have taken reasonable measures to prevent or mitigate the Force Majeure Event; and (d) any Deficiency Item that Manager is unable to correct due to City's failure to provide sufficient funds to effect such correction in the Annual Plan, provided, however, the City shall be under no obligation to amend the Annual Plan. 3.8.4 Acknowledgement of Parties Concerning Deductions. THE PARTIES HERETO AGREE THAT THE $2,000.00 PER MONTH AND $5,000.00 PER MONTH DEDUCTIONS FROM THE PERFORMANCE EVALUATION DEPOSIT REFERENCED ABOVE CONSTITUTE A REASONABLE APPROXIMATION OF THE ACTUAL DAMAGES THAT THE CITY WOULD SUFFER DUE TO A FAILURE BY MANAGER TO ADHERE TO THE REQUIRED PERFORMANCE LEVEL, CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE EFFECTIVE DATE OF THIS AGREEMENT, INCLUDING THE RELATIONSHIP OF THE CHARGES TO THE RANGE OF HARM TO CITY THAT REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES WOULD BE COSTLY OR INCONVENIENT. THE AUTHORITY OF THE CITY TO EFFECT SUCH DEDUCTIONS SHALL NOT LIMIT THE CITY'S TERMINATION RIGHTS AS SET FORTH IN THIS AGREEMENT. IN PLACING ITS INITIALS AT THE PLACES PROVIDED -19- HEREIN BELOW, EACH PARTY SPECIFICALLY CONFIRMS THE ACCURACY OF THE STATEMENTS MADE ABOVE AND THE FACT THAT EACH PARTY HAS BEEN REPRESENTED BY COUNSEL WHO HAS EXPLAINED THE CONSEQUENCES OF THE DEDUCTION PROVISIONS AT OR PRIOR TO THE TIME EACH EXECUTED THIS AGREEMENT. MANAGER CITY 3.8.5 Performance Evaluation Deposit. Not later than commencement of the Management Term, and as a condition to commencement of the Management Term, Manager shall deposit with City in cash the sum of Twenty -Five Thousand Dollars ($25,000) as security for the performance of Manager's obligations pursuant to this Section 3.8 ("Performance Evaluation Deposit"). The Performance Evaluation Deposit shall not be a Golf Course Expense. In the event of failure of Manager to timely correct Deficiency Items as provided in this Section 3.8, the City Manager shall have the authority to deduct from the Performance Evaluation Deposit the amounts set forth in Section 3.8.2. In the event City is required to make deductions from the Performance Evaluation Deposit, Manager shall promptly, upon written request therefor by City, submit such additional cash amounts to City as is required in order to maintain the Performance Evaluation Deposit at the Twenty -Five Thousand Dollar ($25,000) level. 3.9 Manager Purchases. In connection with any purchases made by Manager, or any related entity or person, for the account of City, it is understood that Manager may perform services as a representative of the manufacturer to secure the benefits of lower costs, and that any resulting savings shall be passed on to City, including representatives' fees. In addition, all trade discounts, rebates and refunds pertaining directly or indirectly to purchases for the Golf Course shall accrue to the benefit of City. All property, real, personal, or otherwise, so purchased by Manager shall be the property of the City. 3.10 Capital Improvements. 3.10.1 Capital Improvement Funds. City shall deposit monthly from the Golf Course Accounts an amount equal to two percent (2%) ("Capital Improvement Fund Percentage") of that portion of the Gross Revenues for the previous month attributed to green fees ("Capital Improvement Funds"). City shall establish and maintain a separate reserve account for the Capital Improvement Funds and these Capital Improvement Funds shall be used for the purposes described in this Agreement. The parties hereby acknowledge and agree that the Capital Improvement Funds shall belong to City, and City shall have complete control over the Capital Improvement Funds. The parties hereby agree that prior to each Operating Year, in connection with the preparation and approval of the "Capital Improvement Plan" as described -20- in Section 3.10.2 below, the parties shall discuss whether the Capital Improvement Fund Percentage should be changed. Any decision to change the Capital Improvement Fund Percentage shall be in the sole discretion of City Manager, and in making such decision City Manager shall consider such factors as the amount of Capital Improvement Funds currently available and the projected capital improvement requirements of the Golf Course. In no event, however, shall the Capital Improvement Fund Percentage be increased in excess of two percent (2%) except with the written approval of the City Council. 3.10.2 Capital Improvement Plans. During the Management Term, Manager shall submit on or before April 1 of each year, a "Capital Improvement Plan" for the Golf Course for the next Operating Year, which shall include Manager's recommendation of Capital Improvement projects for the next Operating Year, estimated costs of such Capital Improvement projects. 3 10 3 Implementation of Capital Improvement Projects. The parties acknowledge and agree that all Capital Improvement projects are in City's sole control and discretion, and all costs and expenses of Capital Improvement projects shall be paid from the Capital Improvement Funds or from other City funds. The costs and expenses of Capital Improvement projects shall not be considered Golf Course Expenses. The parties acknowledge and agree that this Agreement imposes no responsibilities or obligations on the part of Manager with respect to any aspect of a Capital Improvement project, including design, construction or supervision. In the event City desires Manager to be involved in any capacity in a Capital Improvement project, the City Manager shall be authorized to enter into a separate agreement with Manager setting forth the terms and conditions of such involvement, including without limitation fees to be received by Manager for such involvement. 3.11 Insurance During Management Term. 3.11.1 Coverage. Manager agrees to procure and maintain, during the Management Term, as a Golf Course Expense, at a minimum the following insurance: (a) insurance on the contents of the buildings located at the Golf Course and other personal property located at the Golf Course which contents and personal property are owned or leased by Manager, against loss or damage by fire, lightning and/or any other perils insurable under the form of "all risk" coverage then available (including specifically irrigation and/or sprinkler system leakage damage, vandalism and malicious mischief, if available), in an amount not less than the lesser of (i) the actual replacement cost of the contents and personal property, or (ii) Five Million Dollars ($5,000,000.00); -21- provided, however, the parties may agree in writing to such other minimum amount. City shall be named as a loss payee. The parties agree that Manager shall not be responsible for procuring or maintaining "all risk" insurance coverage on the buildings, structures, or other improvements located at the Golf Course and the contents and personal property owned by City, and City shall either procure or maintain such insurance coverage or shall self -insure for such risks. (b) business interruption insurance, in an amount equal to the annual value of lost business, as determined by the City and Manager, and as required by or pursuant to any "City Financing" (as that term is defined in Section 11.21), covering actual losses sustained due to (i) fire, lightning, and other perils insurable under the form of "all risk" coverage then available (including specifically irrigation and/or sprinkler system leakage damage, vandalism, and malicious mischief, if available) or (ii) the routine or extraordinary maintenance of, or any failure of, any pipes or facilities located above or beneath the surface of the Golf Course. City shall be named as a loss payee to the extent of the City's interests under this Agreement which interests include, without limitation, the Financing. (c) comprehensive public liability insurance, including without limitation bodily injury, personal injury, property damage, products liability, contractual liability covering the provisions of this Agreement, and liquor liability, in an amount not less than Ten Million Dollars ($10,000,000.00) single limit per occurrence. City, and its officers, officials, employees, agents, representatives, and volunteers (collectively, "City Personnel"), shall be named as an additional insureds. (d) automobile liability and garage keeper's liability insurance in an amount not less than Ten Million Dollars ($10,000,000.00) single limit per occurrence. City and City Personnel shall be named as additional insureds. (a) workers compensation insurance covering all Golf Course employees who are Manager's employees in an amount as required by law, and employer's liability insurance in an amount not less than One Million Dollars ($1,000,000.00) or as required by law covering all Golf Course employees who are Manager's employees. Manager shall have the right to increase (but not to decrease without the prior written consent of the City Manager) the minimum amount of any insurance to be maintained by Manager with respect to the Golf Course under this Section in order to make such coverage comparable to the amount of insurance carried with respect to other golf courses and country clubs -22- operated by Manager, taking into account the size, character and location of the Golf Course. The types of insurance and the coverage amounts specified in this Section are the requirements of City in connection with the operation of the Golf Course. City acknowledges and understands that Manager has made no representations or warranties that such insurance is adequate to protect City. Any losses, damages, liability, or expenses that are not required to be covered by any of the insurance specified in this Section shall be a Golf Course Expense. In its sole discretion, City may elect to procure and maintain at one or more times and from time to time, some or all of the policies of insurance set forth in subparagraphs (a), (b), (c), and (d) above that Manager is required to procure and maintain, and in such case City shall notify Manager in writing (i) that Manager is temporarily relieved from the obligation of procuring and maintaining the policy(ies) of insurance specified by City in its written notice to Manager, and (ii) of the period of time during which Manager's obligation to procure and maintain the policy(ies) specified in City's written notice is suspended. 3.11 .2 Policies and Endorsements. 3.11.2.1 Policies. All insurance coverages required under this Section 3.11, shall be secured through policies issued by insurance companies of good reputation and of sound and adequate financial responsibility having a general policy holder's rating of not less than "A" and a financial rating of not less than Class VIII in the most current edition of Best's Rating Guide, unless such requirements are waived in writing by the City Manager. Such insurance companies shall be qualified to do business and in good standing in California. Prior to the Effective Date, Manager shall deliver to City certificates of insurance with respect to all of the policies of insurance required to be procured and maintained by Manager pursuant to this Section 3.11, and the City Manager shall have approved such certificates of insurance. In the case of insurance about to expire, Manager shall deliver to the City Manager certificates of insurance with respect to renewal policies not less than thirty (30) days prior to the respective dates of expiration. All certificates of insurance shall be signed by a person authorized by the insurance company to bind coverage on its behalf. In the event any subcontractors perform work for Manager under this Agreement, Manager shall include such subcontractors as insureds under the policies of insurance to be maintained by Manager pursuant to this Section 3.11, or in the alternative, Manager shall obtain from such subcontractors separate certificates of insurance that satisfy the requirements of this Section 3.11 unless otherwise waived by the City Manager. Neither the procuring of insurance by Manager pursuant to this Section 3.11, nor the delivery by Manager to City of certificates of insurance evidencing such insurance coverages, shall be construed as a limitation of Manager's indemnity obligations under Section -23- 11.2.1. 3.11.2.2 Endorsements. All policies of insurance to be maintained by Manager pursuant to this Section 3.11 shall have attached an endorsement that such policy shall not be canceled or materially changed without at least thirty (30) days prior written notice to City by certified mail, return receipt requested. In addition, Manager shall also provide to City the required 30-day prior written notice in the manner set forth in this Section 3.11. 3.11.3 Blanket Policies. Any insurance policies provided by Manager under this Section 3.11 may be affected under policies of blanket insurance which cover other properties in addition to the Golf Course, and in such case an allocable portion of the premiums for such blanket policies of insurance shall be considered a Golf Course Expense. 3.11 .4 Workers Compensation Insurance. Not later than the Effective Date, and as a condition to the effectiveness of this Agreement, Manager shall deliver to the City Manager a certificate of workers compensation insurance indicating that such insurance complies with all requirements of California law. This certificate shall provide that such policy shall not be canceled or materially changed without at least thirty (30) days prior written notice to City by certified mail return receipt requested. Manager shall require all subcontractors performing work for Manager under this Agreement to maintain workers compensation insurance covering such subcontractors' employees. Prior to the Effective Date, Manager shall file with the City Manager the following signed certification: "The undersigned is aware of and will comply with, Divisions 4 and 5 of the California Labor Code by securing, paying for, and maintaining in full force and effect for the duration of the Agreement, complete workers compensation insurance, and shall furnish a certificate of insurance to City prior to the commencement of the term of the Agreement." City and City Personnel shall not be responsible for any claims in law or equity occasioned by the failure of Manager to comply with this Section 3.11 as it pertain to worker's compensation insurance, or with the provisions of California law relating to workers compensation insurance. 3.11.5 Waiver of Subrogation. Neither Manager nor City shall assert against the other, and Manager and City hereby waive with respect to each other, any claims and rights of recovery for any losses, damages, liability or expenses (including attorneys' fees) incurred or sustained by either of them on account of injury to persons or damage to property arising out of the ownership, operation and maintenance of the Golf Course to the extent that -24- the same are covered by the insurance required under this Section 3.11. City and Manager hereby grant to each other, on behalf of any insurance company providing insurance covering the Golf Course, a waiver of any right of subrogation which any insurer or party may acquire against the other party by virtue of payment of any loss under any insurance policy. City and Manager shall give notice to the insurance companies providing insurance under this Agreement of the mutual waiver of subrogation contained in this Section 3.11. 3.11.6 Insurance Maintained by Manager. Any insurance maintained by Manager under this Section 3.11 may contain deductible provisions and self- insurance or self -assumption provisions in such amounts as are maintained by Manager for other golf courses of a similar quality level operated by Manager. The parties acknowledge and understand that as of the Effective Date the following applies to insurance maintained by Manager: (a) Five Thousand Dollars ($5000.00) deductible per occurrence for property damage insurance, (b) ZERO Dollars ($0.00) self -insured retention per occurrence for comprehensive public liability insurance, automobile liability insurance, and garage keeper's liability insurance, and (c) ZERO Dollars ($0.00) participation in loss limits (which is comparable to self-insurance) per accident for workers compensation insurance. City understands and agrees that with respect to ail policies of insurance required under this Section 3.11, the portion of any claim, loss, or damage subject to a deductible amount or a self-insurance or self -assumption amount shall be a Golf Course Expense. Manager shall notify City in writing at least thirty (30) days prior to any increase in the deductible amount or self -insured or self -assumed amounts for the insurance coverage maintained by Manager under this Section 3.1 1 . The City Manager shall have the right to approve any such increase if the amount of the increase (on a percentage basis) as compared to the deductible amount or self -insured or self -assumed amounts set forth in clauses (a), (b), and (c) above exceeds the percentage increase, if any, of the Index from the Management Term Commencement Date, to the month immediately preceding Manager's notice of the proposed increase. 3.12 Handling of Claims. Manager shall be responsible for handling all claims, demands, and lawsuits for any losses, damages, liability, and expenses (including without limitation personal injury and property damage claims) arising out of the operation and management of the Golf Course ("Claims"), whether or not such Claims are covered by the insurance required under Section 3.11. Handling such Claims shall include without limitation responding to such Claims, investigating such Claims, retaining legal counsel to defend such Claims, settling such Claims, and paying any losses, damages and expenses relating to such Claims. All costs and expenses relating to the handling of such Claims as set forth in the preceding sentence, including without limitation attorneys' fees and costs for Manager's in- house counsel and for outside legal counsel as approved in the Annual Plan or by the City Manager in writing, shall be a Golf Course Expense. The City Manager -25- shall have the right to approve any legal counsel retained by Manager to defend the City, and to approve all legal bills incurred in such defense. 3.13 Cost of Sales. Manager shall provide an accounting for its Cost of Sales as part of the profit and loss statements to the City required by Section 5.6. 4.0 MANAGER FEES DURING MANAGEMENT TERM 4.1 Forms of Manager Compensation. Manager shall receive as compensation for its services during the Management Term a fixed management fee (the "Management Fee"). The Management Fee is further defined below. 4.1.1 Management Fee. Manager shall receive from City a Management Fee in the amount of Ninety -Six Thousand Dollars ($96,000) for Fiscal Year 2013/2014 and Fiscal Year 2014/2015. The Management Fee will increase 4% annually for the third, fourth, and fifth fiscal years. The annual Management Fee shall be payable in arrears in twelve monthly installments, payable by City each month within thirty (30) business days of receipt of an invoice for same from Manager (subject to any extensions as may be required for approval of warrants by the City Council, if applicable). 5.0 ACCOUNTS: WORKING FUNDS; DISBURSEMENT OF FUNDS; RECORDS AND REPORTS 5.1 Golf Course Accounts. City shall establish appropriate bank account(s) for the Golf Course, including for the deposit of all Gross Revenues and other Golf Course revenues and for the Capital Improvement Funds, at a banking institution or institutions selected by the City Manager or City Finance Director, such accounts to be in City's name (the "Golf Course Accounts"). Manager shall deposit on a daily basis in the Golf Course Accounts all monies received from the operation of the Golf Course. Any interest earned on monies in the Golf Course Accounts shall be the property of the City. Manager shall also be entitled to maintain funds in amounts approved by the City Manager or City Finance Director in "cash register banks or in petty cash funds at the Golf Course. Within ten (10) days of commencement of the Management Term, the City, shall advance Two Hundred Fifty Thousand Dollars ($250,000.00) to Manager (the "Advance"), to pay expenses for the first month of Golf Course operations. Manager shall deposit the Advance in a bank account at a bank and upon terms and conditions approved by the City Finance Director (the "Advance Account"). Manager shall be responsible for the payment of those Golf Course Expenses identified in Section 5.2.1(a) as incurred in accordance with the monthly operating budgets set forth in the approved Annual Plan but only to the extent funds have been made available by the City. Manager shall invoice the City for repayment of Golf Course Expenses paid from the Advance or the Advance Account on or before the 15' and 15`" of each month. Manager may use the Advance as necessary to pay any Golf Course Expenses authorized under this Agreement to be paid by Manager and required to -26- be paid, until Manager has received reimbursement from the City. Upon receipt of payment from the City, Manager shall replenish the Advance to its full amount. All Golf Course funds held by Manager, whether the Advance or monies held by Manager in "cash register banks" or petty cash funds at the Golf Course shall be owned by City. 5.2 Payment of Golf Course Expenses. 5.2.1 Payment of Certain Golf Course Expenses by Manager. (a) Consistent with the terms of Section 5.1, Manager shall pay, initially from the Advance or from its own account (or, if appropriate, from "cash register banks" or petty cash funds available at the Golf Course) Golf Course Expenses (other than the Golf Course Expenses set forth in Section 5.2.2) as and when incurred; provided, however, that (1) the amount disbursed must constitute a permitted Golf Course Expense pursuant to the monthly operating budget in the approved Annual Plan and (2) Manager shall provide the City Manager or City Finance Director, no later than ten (10) days following the end of each calendar month, an accounting delineating the Golf Course Expenses paid and payable for such preceding calendar month (e.g., accounting due not later than April 10 covering the immediately preceding month of March). (b) City shall pay to Manager approved Golf Course Expenses invoiced to the City consistent with the Annual Plan within thirty (30) days of the receipt of the invoices and all necessary supporting documentation. Manager shall deposit these payments in the Advance Account to be used to pay Golf Course Expenses. (c) With the prior written approval of the City Manager, which approval may be granted or withheld in the sole discretion of City Manager, Manager shall be reimbursed for those expenses incurred by Manager prior to the commencement of the Management Term which, in the opinion of the City Manager, would constitute Golf Course Expenses if they had been expended subsequent to the commencement of the Management Term. 5.2.2 Payment of Management Fee. Manager shall invoice the City on a monthly basis for the Management Fee; provided, however, that such payment to Manager shall be paid in accordance with the terms of Section 4.1.1. 5.3 Remaining Funds. Upon the expiration or earlier termination of this Agreement, Manager shall repay the Advance, all amounts in the Advance -27- Account, and any and all funds held in possession of Manager or its agents that are revenues of the Golf Course. After termination of this Agreement, and assuming no uncured breaches exist, City shall pay to Manager any monies due Manager under this Agreement, but unpaid as of the date of termination, within ten (10) days after Manager delivers to the City Manager the final profit and loss statement. 5.4 Books and Records. Manager shall keep full and accurate books of account and such other records as are necessary to reflect the results of the operation of the Golf Course. For this purpose, City agrees it will make available to Manager, or Manager's representatives, all books and records in City's possession relating to the Golf Course including contract documents, invoices and construction records. All books and records for the Golf Course shall be located either at the Golf Course or at Manager's corporate office. All accounting records shall be maintained in accordance with generally accepted accounting principles and shall be maintained in an accrual format. All such books, records, and reports shall be maintained separately from other facilities operated by Manager. Manager agrees to maintain reasonable and necessary accounting, operating, and administrative controls relating to the financial aspects of the Golf Course and such controls shall provide checks and balances designed to protect the Golf Course, Manager, and City. The cash registers used by Manager shall be approved by the City Manager. Manager shall maintain all financial and accounting books and records for a period of at least seven (7) years after the expiration or earlier termination of this Agreement, and City shall have the right to inspect and audit such books and records during such period as provided in Section 5.5 below. 5.5 Inspection. Upon seven (7) days prior written notice to Manager, which notice shall set forth the date and time that City desires to inspect the books and records, City or its authorized agents, auditors, or representatives shall have the right during normal business hours to review, inspect, audit, and copy the books, records, invoices, deposit receipts, canceled checks, and other accounting and financial information maintained by Manager in connection with the operation of the Golf Course. All such books and records shall be made available to City at the Golf Course unless City and Manager agree upon another location. City, at its own expense, shall have the right to retain an independent accounting firm to audit the books and records of the Golf Course from time to time. 5.6 Reports to City. Manager shall deliver to City the following financial statements, in a form acceptable to City: (a) Within twenty (20) days after the end of each calendar month, a profit and loss statement showing the results of operation of the Golf Course for such month and for the Operating Year to date, which statement shall include sufficient detail to reflect all Gross Revenues, Cost of Sales, Management Fee, and Capital Improvement Funds; and (b) Within sixty (60) days after the end of each Operating Year, a profit -28- and loss statement showing the results of operation of the Golf Course for such Operating Year which statement shall include sufficient detail to reflect all Gross Revenues, Management Fee, and Capital Improvement Funds. If requested by City, and at the sole expense of City, the financial statements shall be audited according to Generally Accepted Audit Standards by an independent certified public accountant acceptable to the City, to be completed in a time frame established by the CPA. 5.7 Manager Accounting Software. The parties acknowledge and understand if the accounting software to be used at the Golf Course is owned by Manager, City shall have no rights or interests in such software. Upon the expiration or earlier termination of this Agreement, accounting software owned by Manager shall be removed from the Golf Course by Manager. 6.0 GOLF COURSE NAME The Golf Course shall be known by such trade name and/or trademark or logo as may from time to time be determined by City. The parties acknowledge and understand that the names, logos, and designs used in the operation of the Golf Course together with appurtenant goodwill, are the exclusive property of City. Manager may identify the Golf Course as a golf course managed and operated by Manager; provided, however, that any display of any Manager logo or other corporate identification shall first be approved by the City Manager in his or her sole discretion. At no time will the Manager's logo be printed more prominently than the Golf Course or City logo. 7.0 ENVIRONMENTAL MATTERS In performing its responsibilities under this Agreement, Manager shall comply with all federal state, and local laws and regulations pertaining to the storage, use, and disposal of "hazardous or toxic wastes, substances, or materials" as defined by applicable law. MSDS sheets shall be visible as required by law. 8.0 TERMINATION RIGHTS 8.1 Termination by City. In addition to any other rights of City to terminate this Agreement that are set forth in this Agreement, City shall also have the right to terminate this Agreement upon the occurrence of any of the following events: (a) Manager fails to keep, observe or perform any material covenant, agreement, term or provision of this Agreement to be kept, observed or performed by Manager, and such default continues for a period of thirty (30) days after written notice and a demand to cure such default by City to Manager; or (b) Failure to meet the Operating Standards set forth in Section 3.8.2(a); or -29- (c) (i) Manager or its parent(s) applies for or consents to the appointment of a receiver, trustee or liquidator of Manager or of all or a substantial part of its assets; (ii) Manager or its parent(s) files a voluntary petition in bankruptcy or commences a proceeding seeking reorganization, liquidation, or an arrangement with creditors; (iii) Manager or its parent(s) files an answer admitting the material allegations of a bankruptcy petition reorganization proceeding, or insolvency proceeding filed against Manager or its parent(s); (iv) Manager or its parent(s) admits in writing its inability to pay its debts as they come due; (v) Manager or its parent(s) makes a general assignment for the benefit of creditors; or (vi) an order, judgment or decree is entered by a court of competent jurisdiction, on the application of a creditor, adjudicating Manager or its parent(s) a bankrupt or insolvent or approving a petition seeking reorganization of Manager or its parent(s) or appointing a receiver, trustee or liquidator of Manager or its parent(s) or of all or a substantial part of its assets, and such order, judgment or decree continues unstayed and in effect for any period of sixty (60) consecutive days. City's right to terminate this Agreement pursuant to this Section shall be exercisable immediately upon written notice to Manager given at any time after the applicable notice and cure period has expired, and City's termination notice shall specify the effective date of such termination, which date shall not be more than sixty (60) days after the date of City's termination notice; provided, however, that no notice and cure period or sixty (60) day delay shall apply with respect to terminations pursuant to subparagraph (c) of this Section. 8.2 Termination by Manager. Manager shall have the right to terminate this Agreement if City fails to keep, observe, or perform any other material covenant, agreement, term or provision of this Agreement to be kept, observed or performed by City, and such default continues for a period of thirty (30) days after notice and a demand to cure such default by Manager to City. Manager's right to terminate this Agreement Pursuant to this Section shall be exercised upon written notice to City given at any time after the applicable grace period has expired. The grace period shall be extended as may be required for the City Council to comply with applicable law pertaining to the posting of agendas and hearings notices. Manager's termination notice shall specify the effective date of such termination, which date shall not be less than sixty (60) days after the date of Manager's termination notice. 8.3 Effect of Termination. The termination of this Agreement under the provisions of this Article 8.0 shall not affect the rights of the terminating party with respect to any damages it has suffered as a result of any breach of this Agreement, nor shall it affect the rights of either party with respect to any liability or claims accrued, or arising out of events occurring, prior to the date of termination. 8.4 Remedies Cumulative. Neither the right of termination, nor the right to sue -30- for damages, nor any other remedy available to a party under this Agreement shall be exclusive of any other remedy given under this Agreement or now or hereafter existing at law or in equity. 9.0 TITLE MATTERS; ASSIGNMENT 9.1 Ownership of Improvements and Personal Property. All improvements to the Golf Course made during the term of this Agreement and all Furnishings and Equipment and Operating Inventory purchased by Manager during the term of this Agreement shall be considered property owned by City at such time as the improvements are made or the Furnishings and Equipment or Operating Inventory are purchased. 9.2 Assignment or Subcontracting. Manager shall neither directly or indirectly assign this Agreement to any third party, nor contract or subcontract any work required hereunder to any third party, without the prior written consent of the City. Except as provided below, the ownership structure or composition of Manager, or any direct or indirect parent(s) thereof, as it existed as of the date of execution of this Agreement, shall not be changed, amended, or modified without the prior written consent of the City Council. Transfers restricted hereunder include the direct or indirect transfer of more than twenty-five percent (25%) of the stock, partnership interests, or other form of equity ownership in the Manager or its direct or indirect parent(s), and/or any transfer of operational control of the Manager or its parent(s). Transfers of more than twenty-five percent (25%) but less than fifty percent (50%) of the stock, partnership interests, or other form of equity ownership in Manager or its direct or indirect parent(s) may be approved in writing by the City Manager. Transfer of over fifty percent (50%) shall require prior City Council approval. Any otherwise lawful assignment by Manager shall not be effective unless and until Manager and such assignee execute an assignment and assumption in a form acceptable to the City Attorney. It is understood and agreed that any consent granted by the City Manager to any such assignment by Manager shall not be deemed a waiver of any consent required under this Section as to any future assignment. Any assignment by Manager of this Agreement in violation of the provisions of this Agreement shall be null and void and shall result in the immediate termination of this Agreement. In addition to any other remedies available to the parties, the provisions of this Section shall be enforceable by injunctive proceeding or by suit for specific performance. 9.3 Successors and Assigns. Subject to Section 9.2, this Agreement shall inure to the benefit of and be binding upon the parties and their respective heirs, legal representatives, successors and assigns. 10.0 DAMAGE OR DESTRUCTION; EMINENT DOMAIN; FORCE MAJEURE EVENTS 10.1 Damage or Destruction. Should the Golf Course be destroyed or -31- substantially damaged by fire, flood, acts of God, or other casualty, City, by written notice to Manager given within sixty (60) days following the occurrence of such event, shall have the right to terminate this Agreement on the basis that City does not choose to rebuild or restore the Golf Course, and in such event neither party shall have any further obligation to the other party under this Agreement, except with respect to liabilities accruing, or based upon events occurring, prior to the effective date of such termination. For the purpose of this Section, the Golf Course shall be deemed to have been substantially damaged if the estimated length of time required to restore the Golf Course substantially to its condition and character just prior to the occurrence of such casualty shall be in excess of six (6) months, as indicated by an architect's certificate or other evidence reasonably satisfactory to Manager. If this Agreement is not terminated in the event of damage to the Golf Course either because (i) the damage does not amount to substantial damage as described above, or (ii) notwithstanding destruction of or substantial damage to the Golf Course, City elects to restore the Golf Course, then City shall proceed, at City's own expense, with all due diligence to commence and complete restoration of the Golf Course to its condition and character just prior to the occurrence of such casualty. If as a result of any damage or destruction to the Golf Course as provided in this Section, the responsibilities of Manager under this Agreement are substantially changed, then the parties shall meet and discuss in good faith appropriate modifications to this Agreement including the Management Fees. 10.2 Eminent Domain. If all of the Golf Course (or such a substantial portion of the Golf Course so to make it unfeasible, in the reasonable opinion of City, to restore and continue to operate the remaining portion of the Golf Course for the purposes contemplated in this Agreement) shall be taken through the exercise (or by agreement in lieu of the exercise) of the power of eminent domain, then upon the earlier of (i) the date that City shall be required to surrender possession of the Golf Course or of that substantial portion of the Golf Course, or (ii) the date when the Golf Course is no longer open, this Agreement shall terminate and neither party shall have any further obligation to the other party under this Agreement except with respect to liabilities accruing, or based upon events occurring, prior to the effective date of such termination. If such taking of a portion of the Golf Course shall not make it unfeasible, in the reasonable opinion of City, to restore and continue to operate the remaining portion of the Golf Course for the purposes contemplated in this Agreement, then this Agreement shall not terminate, and City shall proceed, at City's own expense, with all due diligence to alter or modify the Golf Course so as to render it a complete architectural unit which can be operated as a golf course of substantially the same type and character as before. If as a result of any alteration or modification of the Golf Course as provided in this Section, the responsibilities of Manager under this Agreement are substantially changed, then the parties shall meet and discuss in good faith appropriate modifications to this Agreement including the Management Fees. 10.3 Force Majeure Events. As used in this Agreement, the term "Force Majeure -32- Event" means a disruption in the operation of the Golf Course due to, or the cause of the failure to perform by a party hereto due to, declared or undeclared war, sabotage, riot or acts of civil disobedience, acts or omissions of governmental agencies (except acts of governmental agencies including but not limited to the City taken in accordance with this Agreement), accidents, fires, explosions, floods, earthquakes, or other acts of God, strikes, labor disputes, shortages of materials, or any other event not within the control of Manager and not caused by the gross negligence or intentional wrongful conduct of Manager. For purposes of this Section, any disruption to the operation of the Golf Course caused by a Capital Improvement project shall also constitute a Force Majeure Event. If as a result of the occurrence of a Force Majeure Event, the responsibilities of Manager under this Agreement are substantially changed, then the parties shall meet and discuss in good faith appropriate modifications to this Agreement including the Management Fees. 11.0 GENERAL PROVISIONS 11.1 Contract Administration. City has designated the City Manager as the individual who is responsible for administering this Agreement on behalf of City. The City Manager may designate a member of his or her staff to serve as the Project Manager, which individual shall carry out the City Manager's responsibilities in administering this Agreement. The City Manager shall inform Manager in writing of the person who will serve as the Project Manager and any change of the Project Manager. Manager has designated Joe Gill, Director of Golf Operations, as the individual who is responsible for administering this Agreement on behalf of Manager. Manager shall notify the City Manager in writing if another individual has replaced the foregoing designated person as the person responsible for administering this Agreement on behalf of Manager. The parties acknowledge that except as otherwise expressly provided herein (a) the City Manager has the authority to approve or consent to those matters identified in this Agreement as requiring City's approval or consent and to make all other decisions on behalf of City regarding the administration of this Agreement (except where City Council approval is expressly required herein), and (b) Manager's foregoing designated person or such other individual designated by Manager in writing to City has the authority to approve or consent to those matters identified in this Agreement as requiring Manager's approval or consent and to make all other decisions on behalf of Manager regarding the administration of this Agreement. City's management direction to Manager shall be given by the City Manager. 11.2 Indemnities. 11.2.1 Manager's Indemnity. Manager agrees to indemnify and hold harmless City and City's officers, officials, members, employees, agents, representatives, and volunteers from and against any and all claims, demands, actions, lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, expert witness fees, attorneys' fees, costs, and expenses, -33- which results from one or more of the following: (a) any act or omission by Manager or any shareholder, director, officer, or employee of Manager in connection with Manager's performance under this Agreement that constitutes negligence or willful misconduct; or (b) any action taken by Manager relating to the Golf Course (i) that is expressly prohibited by this Agreement, or (ii) that is not within the scope of Manager's duties under this Agreement, or (iii) that is not within Manager's delegated authority under this Agreement; or (c) Manager's breach of any material covenant, requirement or commitment contained in this Agreement; or Manager's indemnity obligations under this Section shall not apply to any acts or omissions taken (or in the case of omissions, not taken) either at the written direction of City or with the written approval of City. 11.2.2 City's Indemnity. City agrees to indemnify and hold harmless Manager and its owners, officers, directors, and employees from and against any and all claims, demands, actions, lawsuits, proceedings, damages, liabilities, judgments, penalties, fines, expert witness fees, attorneys' fees, costs, and expenses, which result from: (a) any act or omission by Manager in connection with the management and operation of the Golf Course (i) that is expressly authorized by this Agreement, or (ii) that is within the scope of Manager's duties under this Agreement, or (iii) that is within Manager's delegated authority under this Agreement, or (iv) that was either at the written direction of City or with the written approval of City; unless such act or omission constitutes negligence or willful misconduct (and was neither at the written direction of City nor with the written approval of City) in which event Manager shall not be indemnified under this Section. (b) any act or omission constituting negligence or willful misconduct by City or any officer, official, member, employee, agent, representative, or volunteer of City; or (c) City's failure to make any payment to Manager hereunder to which Manager is entitled pursuant to the terms of this Agreement, provided that Manager has provided written notice to City of such asserted failure and has given City an opportunity of not less than sixty (60) days to cure or contest such asserted failure. -34- 11.3 Notices. All notices, demands, requests, consents, approvals, replies and other communications ("Notices") required or permitted by this Agreement shall be in writing and may be delivered by any one of the following methods: (a) by personal delivery; (b) by deposit with the United States Postal Service as certified or registered mail return receipt requested, postage prepaid to the addresses stated below (Notices deposited with the United States Postal Service shall be actually deposited with a branch of the United States Postal Office located in either the county of City's address as provided in this Section or the county of Manager's address as provided in this Section); or (c) by deposit with a same -day or overnight express delivery service that provides a receipt showing date and time of delivery. Notice deposited with the United States Postal Service in the manner described above shall be deemed effective three (3) business days after deposit with the Postal Service. Notice by same -day or overnight express delivery service shall be deemed effective upon receipt. Notice by personal delivery shall be deemed effective at the time of personal delivery. For purposes of Notices hereunder, the address of City shall be: City of La Quinta Attn: City Manager 78495 Calle Tampico La Quinta, CA 92253 For purposes of Notices hereunder, the address of Manager shall be: Landmark Golf Management Attn: President 74947 Highway 111 Indian Wells, CA 92210 Each party shall have the right to designate a different address within the Southern California area by the giving of notice in conformity with this Section. 11.4 Independent Contractor. Manager shall at all times be considered an independent contractor under this Agreement. Nothing contained in this Agreement shall be construed to be or create a partnership or joint venture between City and its successors and assigns, on the one part, and Manager and its successors and assigns, on the other part. 11.5 Compliance with Law; Licenses. Manager shall comply with all applicable laws of governmental bodies having jurisdiction with respect to the Golf Course site and Manager performance of this Agreement. Manager shall, at its expense, procure and maintain all licenses, permits, and approvals required to be obtained by it to perform the work under this Agreement. 11.6 Modification and Changes. This Agreement may be amended or modified -35- only in writing and signed by both parties 11.7 Entire Understanding and Agreement. Except as otherwise provided herein, this Agreement constitutes the entire understanding and agreement between the parties with respect to the subject matter hereof, and this Agreement supersedes all prior understandings and agreements, whether written or oral, between City and Manager pertaining to the subject matter hereof. 11.8 Headings. The Article, Section, and Subsection headings contained in this Agreement are for convenience and reference only and are not intended to define, limit or describe the scope or intent of any provision of this Agreement. 11.9 Consents. Except as provided herein, each party agrees that it will not unreasonably withhold any consent or approval requested by the other party pursuant to the terms of the Agreement, and that any such consent or approval shall not be unreasonably delayed or qualified, except where such consent is expressly stated as within the party's sole and absolute discretion. Similarly, each party agrees that any provision of this Agreement which permits such party to make requests of the other party shall not be construed to permit the making of unreasonable requests. 11.10Survival of Covenants. Any covenant, term, or provision of this Agreement which in order to be effective must survive the termination of this Agreement shall survive any such termination. 11 .11 Third Parties. None of the obligations under this Agreement of either party shall run to or be enforceable by any party other than the party to this Agreement or by a party deriving rights under this Agreement as a result of an assignment permitted pursuant to the terms of this Agreement. 11 .12 Waivers. No failure by Manager or City to insist upon the strict performance of any covenant, agreement, term or condition of this Agreement or to exercise any right or remedy consequent upon the breach of this Agreement shall constitute a waiver of any such breach or any subsequent breach of the same covenant, agreement, term or condition. No covenant, agreement, term or condition of this Agreement and no breach of this Agreement shall be waived, altered or modified except by a written instrument. A waiver of any breach of this Agreement shall only affect this Agreement to the extent of the specific waiver, and all covenants, agreements, terms and conditions of this Agreement shall continue in full force and effect. 11 13Applicable Law• Venue• Service of Process. This Agreement shall be construed and interpreted in accordance with, and shall be governed by, the laws of the State of California. The parties agree that the Superior Court of the State of California, County of Riverside shall have jurisdiction of any litigation between the parties relating to this Agreement. Service of process on City shall be effected in -36- such manner as required by California law for service on public entities. Service of process on Manager shall be made in any manner permitted by California law and shall be effective whether served inside or outside of California. Manager acknowledges that service of process may be effected by service on its registered agent in California, which as of the Effective Date of this Agreement is July 1, 2013. Manager shall promptly notify City in writing of any change pertaining to the entity or address serving as Manager's registered agent in California. 11.14No Presumption Regarding Drafter. City and Manager acknowledge and agree that the terms and provisions of this Agreement have been negotiated and discussed between City and Manager, and that this Agreement reflects their mutual agreement regarding the subject matter of this Agreement. Because of the nature of such negotiations and discussions, it would be inappropriate to deem either City or Manager to be the drafter of this Agreement, and therefore no presumption for or against the drafter shall be applicable in interpreting or enforcing this Agreement. 11.15 Enforceability of Any Provision. If any term, condition, covenant or obligation of this Agreement shall be determined to be unenforceable, invalid, or void, such determination shall not affect, impair, invalidate, or render unenforceable any other term, condition, covenant, or obligation of this Agreement. 11.16 United States Currency. All amounts payable pursuant to this Agreement shall be paid in lawful money of the United States of America. 11.17 Counterparts. This Agreement and any amendment may be executed in counterparts, and upon all counterparts being so executed each such counterpart shall be considered as an original of this Agreement or any amendment and all counterparts shall be considered together as one agreement. 1 1.18 Attorneys' Fees. In the event of a dispute involving the nonperformance by a party hereto of its obligations under this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and all other expenses (including expert witness fees and fees and costs related to discovery and appeal) reasonably incurred in connection with such dispute, whether or not litigation is commenced, in addition to all other relief to which the party is entitled. If the successful party recovers judgment in any legal action or proceeding, the attorneys' fees and all other expenses of litigation shall be included in and made a part of any such judgment. 1 1.19 Publicity. Any commercial advertisements, press releases, articles, or other written media information generated by Manager using City's name or "SilverRock" related to SilverRock Resorts day to day operation(s) shall be subject to the prior approval of the City Manager which approval shall be given or withheld in the City Manager's sole and absolute discretion. 11.20City Financing. Manager acknowledges that tax-exempt bond financing or -37- other tax-exempt financing ("Financing") has been obtained for construction of a portion of the Golf Course. The form and issuance of such Financing, the selection of Financing legal counsel, and all other matters pertaining to the Financing, shall be in the sole and absolute discretion of the City. City has the right, at any time and from time to time, to issue additional financing and/or effect or cause a refinancing and refunding of the Financing in its sole and absolute discretion. Notwithstanding any authority given in this Agreement to Manager to set fees, charges, and prices, the City Council shall have the superior authority to set fees, charges, and prices at the Golf Course. Manager agrees to amend this Agreement at any time and from time to time, if, in the opinion of the City's legal counsel, this Agreement must be amended to comply with laws, regulations, rules, or procedures applicable to the Financing (except those laws regulations, rules and/or procedures adopted by or promulgated by City or any Agency controlled by the City), and any refinancing or refunding thereto, including but not limited to those laws, regulations, rules, and procedures applicable to or promulgated by the Internal Revenue Service. City and Manager shall meet and confer in good faith to effect such written amendment to this Agreement as necessary to insure the Agreement is in compliance as required by the preceding sentence, which amendment(s) shall be affixed as an attachment to this Agreement; provided, however, that in the event City and Manager disagree on the nature or scope of the required amendment(s), either party shall have the right to terminate this Agreement upon written notice to the other party and upon such termination neither Manager nor City shall have any further rights or obligations hereunder. 11.21 Covenants Against Discrimination. Manager agrees that in connection with its performance under this Agreement, there shall be no discrimination by Manager against any person on account of race, color, creed, religion, sex, marital status, national origin or ancestry. Manager agrees to include a provision similar to this Section in all subcontracts entered into by Manager in connection with work being performed under this Agreement. 11 .22 Non -liability of City Officers and Employees. No officer, official, employee, agent, representative, or volunteer of the City shall be personally liable to Manager, or any successor in interest, in the event of any default or breach by the City, or for any amount which may become due to Manager or any successor, or for breach of any obligation of the terms of this Agreement. 11.23Time of the Essence. Time is of the essence of this Agreement. The parties understand that the time for performance of each obligation has been the subject of negotiation by the parties. 1 1.24 Exhibits and Attachments Incorporated. All exhibits and attachments to this Agreement are incorporated herein and made a part hereof. 11.25Authority. The parties represent for themselves that (a) such party is duly organized and validly existing, (b) the person or persons executing this Agreement -38- on behalf of such party is/are duly authorized to execute and deliver this Agreement on behalf of such party, (c) by so executing this Agreement, such party is formally bound to the terms and provisions of this Agreement, and (d) the execution of this Agreement does not violate any provision of any other agreement to which such party is bound. 11.26Authorization to City Manager. In addition to such other authorizations granted the City Manager of City in this Agreement to act on behalf of City, the City Manager shall have the authority, in the event of a dispute involving the interpretation of the terms and provisions of this Agreement, to reasonably interpret the terms and provisions of this Agreement on behalf of City. 11.27 Possessory Interest. Pursuant to California Revenue and Taxation Code Section 107.6, City hereby informs Manager that this Agreement may create a possessory interest subject to property taxation, and in such event Manager may be subject to the payment of property taxes levied on such interest, which taxes, if levied, shall be defined as a Golf Course Expense. IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the day and year first written above. _M 0— 50 a�. ATTEST: 4t/hi Susan Maysels City Clerk APPROVED AS TO FORM RUTAN & TUCKER, LLP SIGNED IN COMEMART M. Katherine Jenson City Attorney "CITY" CITY OF LA QUINTA, a municipal corporation -39- on behalf of such party is/are duly authorized to execute and deliver this Agreement on behalf of such party, (c) by so executing this Agreement, such party is formally bound to the terms and provisions of this Agreement, and (d) the execution of this Agreement does not violate any provision of any other agreement to which such party is bound. 1.1.26 Authorization to City Manager. In addition to such other authorizations granted the City Manager of City in this Agreement to act on behalf of City, the City Manager shall have the authority, in the event of a dispute involving the interpretation of the terms and provisions of this Agreement, to reasonably interpret the terms and provisions of this Agreement on behalf of City. 11.27 Possessory Interest. Pursuant to California Revenue and Taxation Code Section 107.6, City hereby informs Manager that this Agreement may create a possessory interest subject to property taxation, and in such event Manager may be subject to the payment of property taxes levied on such interest, which taxes, if levied, shall be defined as a Golf Course Expense, IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the day and year first written above. Date ATTEST: Susan Maysels City Clerk APPROVED AS TO FORM RUTAN & TUCKER, LLP "CITY" CITY OF LA QUINTA, a municipal corporation Frank J. Spevacek, City Manager M. Katherine Jenson City Attorney -39- on behalf of such party is/are duly authorized to execute and deliver this Agreement on behalf of such party, (c) by so executing this Agreement, such party is formally bound to the terms and provisions of this Agreement, and (d) the execution of this Agreement does not violate any provision of any other agreement to which such party is bound. 11.26 Authorization to City Manager. In addition to such other authorizations granted the City Manager of City in this Agreement to act on behalf of City, the City Manager shall have the authority, in the event of a dispute involving the interpretation of the terms and provisions of this Agreement, to reasonably interpret the terms and provisions of this Agreement on behalf of City. 1 1.27 Possessory Interest. Pursuant to California Revenue and Taxation Code Section 107.6, City hereby informs Manager that this Agreement may create a possessory interest subject to property taxation, and in such event Manager may be subject to the payment of property taxes levied on such interest, which taxes, if levied, shall be defined as a Golf Course Expense. IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the day and year first written above. Date ATTEST: Susan Maysels City Clerk APPROVED AS TO FORM RUTAN & TUCKER, LLP A aq��(&- 4,1 M. Katherine Jenson City Attorney "CITY" CITY OF LA QUINTA, a municipal corporation Frank J. Spevacek, City Manager -39- .rfl Da e A!'2 Date "MANAGER" LANDMARK GOLF MANAGEMENT, LLC MA Na 0 Name: � 9AU-JAA1 M EXHIBIT "A" SILVERROCK GOLF COURSE GOLF COURSE OPERATIONS AND MAINTENANCE STANDARDS 1 . Greens Maintenance. Manager shall maintain all greens in accordance with accepted playability and industry -wide standards. Without limiting the generality of the foregoing, Manager shall maintain all greens in accordance with the following minimum requirements: (i) Change cups and repair ball marks daily. (ii) Mow greens daily with a reel -type mower designed specifically for mowing golf greens and of the type, make, and model accepted by the golf industry. (iii) Verticut all greens as needed to control mat and thatch buildup. (iv) Aerify greens as scheduled and remove plugs the same day, top dress the greens following each core aerification. (v) Treat greens with proper Integrated Pest Management practices (IPM) to control insects, disease, and other pests. (vi) Fertilize greens at a rate and frequency that wi►I promote healthy turf propagation. (vii) Manager shall have the soil analyzed once every five years to determine the nutrient needs of the soil and turf. Additional analysis may be necessary to identify conditions causing a deficiency. 2. Tee Maintenance. Manager shall maintain all tees in accordance with accepted playability and industry -wide standards. Without limiting the generality of the foregoing, Manager shall maintain all tees in accordance with the following minimum requirements: (i) Service tees daily by moving markers. (ii) Mow tees four (4) times weekly with reel -type mower at appropriate height for turf type and climate conditions. (iii) Verticut tees as needed for thatch removal. (iv) Repair worn and damaged turf areas as they occur by overseeding or sod to ensure playable tees at all times. -41- (v) Treat tees with proper IPM practices to control insects, disease, and other pests. (vi) Fertilize tees at a rate and frequency that will promote healthy turf propagation. (vii) Repair divots daily. (viii) Manager shall have the soil analyzed once every five years to determine the nutrient needs of the soil and turf. Additional analysis may be necessary to identify conditions causing a deficiency. (ix) Aerify all tees as scheduled. 3. Fairway Maintenance (Including Driving Range Area). Manager shall maintain all fairways in accordance with accepted playability and industry -wide standards. Without limiting the generality of the foregoing, Manager shall maintain all fairways (including the driving range area) in accordance with the following minimum requirements: (i) Mow fairways with a reel -type mower. Oil Verticut fairways as necessary for turf health and playing conditions. (iii) Aerify all fairways as scheduled. (iv) Overseed and top dress (or sod) worn or bare areas of fairways as necessary. (v) Treat fairways with proper IPM practices to control insects, disease, and other pests. NO Fertilize fairways at a rate and frequency that will promote healthy turf propagation. (vii) Manager shall have the soil analyzed once every five years to determine the nutrient needs of the soil and turf. Additional analysis may be necessary to identify conditions causing a deficiency. 4. Maintenance of Rough and Other Turf Areas. Manager shall maintain rough, turf, perimeter landscape areas, and landscape lawn areas, including plant and annual color areas, in accordance with accepted playability and industry -wide standards. Without limiting the generality of the foregoing, Manager shall maintain all rough, turf, perimeter landscape areas, and landscape lawn areas, including plant and annual color areas, in accordance with the following minimum requirements: -42- (i) Mow at least once per week. (ii) Verticut as necessary to promote healthy growth. (iii) Aerify as needed and seed or sod worn or bare areas in turf as necessary. (iv) Treat areas with proper IPM practices to control insects, disease, and other pests. (v) Fertilize at a rate and . frequency that will promote healthy turf propagation. (vi) Manager shall have the soil analyzed once every five years to determine the nutrient needs of the soil and turf. Additional analysis may be necessary to identify conditions causing a deficiency. 5. Maintenance of Accessory Equipment. Manager shall maintain all golf course accessory equipment in a clean, safe, functioning condition at all times, replacing with equipment and/or materials as necessary, including, but not limited to, the following: (i) Signs. (ii) Trash receptacles. (iii) Tee markers. (iv) Cleat cleaners. (v) Out-of-bounds markers, water hazards, cart directional signs, etc. (vi) Directional flags and poles. (vii) Distance markers (150 yards, etc.). (viii) Greens flags, poles and cups. (ix) Practice green markers and cups. 6. Irrigation. Manager shall maintain the entire irrigation system serving the Golf Course property, including main lines, valves, lateral lines, sprinkler heads, and controllers, in good repair, functioning properly and conforming to all related codes and regulations at all times. Manager shall irrigate the Golf Course property as required to maintain adequate moisture for growth rate and appearance in accordance with accepted industry standards. Adequate soil moisture shall be determined by visual observation, plant resiliency, turgidity, examining cores removed by soil probe, moisture sensoring devices and programming irrigation controllers accordingly. In addition: (i) Consideration shall be given to soil texture, structure, water holding capacity, drainage, compaction, precipitation rate, run-off, infiltration rate, percolation rate, seasonal temperatures, prevailing wind condition, time of -43- day or night, type of grass or plant, and root structures. (ii) In areas where wind creates problems of spraying onto private property or road rights -of -way, the irrigation controller shall be set to operate during the period of lowest velocity. (iii) Manager shall be responsible for monitoring all systems within the Golf Course property and for correcting the same for coverage, adjustment, clogging of lines, and sprinkler heads, and removal of obstacles, including plant materials which obstruct the spray. (iv) Manager shall check the system daily and adjust and/or repair any sprinkler heads causing excessive run-off, or which throw directly onto roadway, paving or walks within rights -of -way. (v) All controllers shall be inspected on a daily basis and adjusted as required, considering the water requirements of each remote control valve. (vi) A soil probe or tensiometer shall be used regularly to determine the soil moisture content in various areas, with particular attention being given to the greens. (vii) Manager shall repair all leaking or defective valves within twenty-four (24) hours. (viii) Upon written request by City, Manager shall file a monthly statement with City certifying that all irrigation systems are functioning properly. (ix) If there is a reduction of the volume of water supplied to the Golf Course property during peak demand periods, the priority of water distribution by Manager shall be as follows: (a) greens, (b) tees, (c) fairways, and (d) other turf and landscape areas. 7. Other Required Duties. (i) Manager shall remove all litter daily from the Golf Course grounds, including but not limited to the Golf Course, maintenance yard, landscape areas, and the driving range. Manager shall remove all trash and debris resulting from Golf Course maintenance as it occurs. Manager shall clean, repair, and replace trash receptacles as necessary to maintain clean, safe, and sanitary conditions at all times. sm (ii) Manager shall maintain shrub and ground cover plantings and lawn areas in a manner to promote proper healthy growth and an aesthetically pleasing appearance at all times. (iii) Manager shall maintain all trees in a safe, healthy and aesthetically pleasing condition at all times. Trees shall be pruned regularly in order to promote growth, safety, and beauty. (iv) Manager shall maintain all sand traps in a raked, edged, and weed -free condition at all times, replacing sand in kind and rakes as necessary. (v) Manager shall take whatever preventive steps necessary and legal to protect all slope areas from erosion at all times, subject to the approved budget. (vi) Manager shall control rodent and other animal pests as necessary. (vii) Managershall maintain and repair as necessary surface flow lines, swales, catch basins, grates, subsurface drainage systems, and other drainage structures in a clear, weed -free, and properly functioning condition at all times. (viii) Manager shall observe all legal requirements and safety regulations in the use and storage of chemicals, hazardous materials, supplies, and equipment. (ix) Manager shall maintain the golf maintenance storage room and yard in a clean, orderly, and safe condition at all times, conforming to all applicable laws and regulations. (x) Manager shall take reasonable measures to protect golfers from injury and the Golf Course from damage in periods of frost, rainy weather, and other unusual conditions. (xi) Manager shall maintain bridge abutments and approaches in a safe and stable condition. (xii) Manager shall maintain walkways, steps, handrails on walkways, headerboards, and cart paths in a clean, edged, safe, and weed -free condition. (xiii) Manager shall maintain, repair, and replace parking lots and driveways to achieve clean, safe, and weed -free conditions. (xiv) Manager shall inspect the following frequently and repair as needed: -45- (a) all area lighting systems for safe and functioning condition, and (b) all golf course parking lots, walkways, and interior paved and/or unpaved surface roads. 8. Equipment. Manager shall maintain all equipment. Personal Vehicles and Vehicles provided under a "Vehicle Allowance" are not entitled to fuel, maintenance, or cleaning under the golf operations and training travel. K" EXHIBIT "B" CITY OF LA QUINTA SILVERROCK GOLF COURSE GOLF COURSE OPERATIONS AND MAINTENANCE STANDARDS SUPERINTENDENT: CITY MANAGER/DESIGNEE: GREENS W QUALITY STANDARD: Smooth, uniform, turf, firm but not hard, well-defined, consistent, of suitable speed for the location. Cups placed in accordance with USGA recommendations. Flags stand up straight. Cups, poles and flags are uniform, clean and in good repair. 100% Turf coverage, color and texture of the greens are uniform and properly mowed. No diseases, weeds, insects, rodents, or bare spots. U NI A TEES QUALITY STANDARD: TEES: Complete turf coverage, level, firm but not hard, clean, properly directed, with trash cans, signs, tee markers, sand and seed containers (as appropriate) in good condition and repair, consistent and uniform in turf coverage and color. No weeds, diseases, insects or rodents. Adequate top dressing, seeding, and divot repair. Minimal litter or broken tees. U NI A FAIRWAYS AND ROUGHS QUALITY STANDARD: Fairways: Uniform turf coverage and color, smooth mowing and trimming, clean, firm but not hard, well defined, that properly supports the ball for play. Roughs: Properly. mowed and trimmed, clean and uniform for play, distinct in height from fairways. Mowing height of fairways and roughs is within USGA specifications, mowing frequency is appropriate for the turf type and season. Absence of wet or dry spots in play areas. No weeds, disease, insects, rodents, off-color areas, or bare spots. U NI A DRIVING RANGE APPEARANCE - MANICURED AND CLEAN. Uniform mowing, color, texture of turf, U = Unacceptable NI=Needs Improvement -47- A = Acceptable smoothness of surface, cleanness of mowing on perimeters. Season appropriate condition. Adequate top dressing, seeding, and divot repair for driving range tees. U NI A TREES AND SHRUBS Pruned to maintain specimen health and safety to golfers and maintenance employees. Shall be maintained in natural form with no geometric shapes. U NI A LAKES AND OTHER WATER BODIES QUALITY STANDARD: Appearance of water -clean, no weeds or noxious growth, no noxious odors, no floating trash/debris. Well defined and marked according to USGA standards. U NI A TRAFFIC CONTROL 1. Ropes, stakes, and other traffic control devices are provided as necessary, in good condition and proper appearance. Traffic control devices are used effectively to minimize turf wear in high traffic areas. Worn areas are under repair. Routes used by golf carts are well -maintained, free of potholes, and present a generally smooth and clean appearance. U NI A 2. Cart paths - Concrete paths are clean with edges properly trimmed. U NI A MAINTENANCE RECORDS AND SCHEDULES All of the following maintenance records properly kept, on site, and up to -date 1. Annual Maintenance Plan U NI A 2. Daily Employee Task Board U NI A, 3. Materials and Safety Data Sheets U NI A 4. Equipment Maintenance Records U NI A 5. Labor scheduling U NI A 6. Gasoline log U NI A 7. First Aid Kit U NI A. U = Unacceptable NI = Needs Improvement -48- A=Acceptable MAINTENANCE EMPLOYEES/CORE STAFF 1. Required state and federal forms posted. U NI A 2. Report number of Department employees. U NI A Actual: Budget: 3. Uniforms, hard hats, steel toe shoes on all Department employees except Golf Course Superintendent and Assistant Golf Course Superintendent. U NI A MAINTENANCE SHOP AND EQUIPMENT 1. Shop area is orderly, clean, with no obvious safety hazards. Fertilizer and chemical storage is per federal, state, and local laws. No trash in yard or shop. U NI A 2. Equipment is in good repair, is clean and properly maintained. Daily checking the engine oil, air cleaners, hydraulic oil, and status of machines under repair. U NI A REST ROOMS MEN'S AND WOMEN'S FRONT NINE. Ceilings, walls, and floors are clean; toilets clean, tops and under sides; mirrors clean and streak fee; soap dispenser clean and full; paper towel, toilet paper, and seat cover dispensers clean and full; counter top, sink, and faucet fixtures clean and functional. Light fixtures clean, functional and bug -free; room air freshener clean and functional; trash receptacle clean with liner, reasonable empty; napkin receptacles clean with liners. U NI A MEN'S AND WOMEN'S BACK NINE. Ceilings, walls, and floors are clean; toilets clean, tops and under sides; mirrors clean and streak fee; soap dispenser clean and full; paper towel, toilet paper, and seat cover dispensers clean and full; counter top, sink, and faucet fixtures clean and functional. Light fixtures clean, functional and bug -free; room air freshener clean and functional; trash receptacle clean with liner, reasonable empty; napkin receptacles clean with liners. U NI A U = Unacceptable NI=Needs Improvement _49- A = Acceptable MANAGER: CITY MANAGER/DESIGNEE: CLUBHOUSE REST ROOMS DATE: MENS AND WOMEN'S CLUBHOUSE. Ceilings, walls, and floors are clean; toilets clean, tops and under sides; mirrors clean and streak fee; soap dispenser clean and full; paper towel, toilet paper, and seat cover dispensers clean and full; counter top, sink, and faucet fixtures clean and functional. Light fixtures clean, functional and bug -free; room air freshener clean and functional; trash receptacle clean with liner, reasonable empty; napkin receptacles clean with liners. U NI A CLUBHOUSE EXTERIOR 1 . Parking lot trash -free, lot well striped and in good repair, trash bin area clean. U NI A 2. Exterior wall surfaces clean and cobweb -free, windows clean. Paint in good condition. All signage in good condition and uniformed. U NI A 3. Ground well -manicured, trash -free, walkways clean and edged, proper planting, planter beds weed and trash -free. U NI A 4. Scorecards on carts with pencil, at golf shop counter, and #/tee. U NI A 5. Preventative maintenance programs in place for building and equipment. U NI A DRIVING RANGE Quality and quantity of balls, ball washer in good condition, balls clean, no trash, employees in uniform with name badge, baskets picked up on a regular basis, receptacle for cigarettes, no cigarette butts on walkways or in grass area, bag stands. U NI A U = Unacceptable NI=Needs Improvement -50- A = Acceptable GOLF (PRO) SHOP 1. Managers Office: Clean, files organized, Manager in uniform with name badge U NI A 2. Customer Service: all staff have been trained in and provide first class service to customers (including staff empowered to handle customer problems). U NI A 3. Prices marked clearly, approved signage, merchandise hung and folded properly, clean and neat with no old stock. U NI A 4. Carpet vacuumed and spot -free, windows and mirrors clean and streak- free, shelves, counter tops, base boards, window ledges are dusted, starter counters clean, and dressing room is clean and not used for storage. U NI A 5. Staff in uniform, clean, neat and clean hair, beard shaved with name badge. U NI A 6. Customer message board up and current, customer comment forms are available on counter. u NI A 7. Starter's responsibilities: Starter sheet is in ink and legible; all last names only with ring number. Complimentary play sheet by starter sheet, cart tickets dated and signed, car key deposit control used. u NI A 8. No employee access to security cameras. U NI A 9. First Aid Kit Available FOOD AND BEVERAGE U NI A 1. Staff in uniform: logo shirt with name badge. U NI A 2. Front counter is clean with condiments fresh and in clean containers. Coffee and soft drink stations are clean, adequately stocked, and ready for use. U NI A 3. Snack display well stocked and clean. U NI A 4. Storage areas: clean with shelves organized. Food and materials stored per applicable governmental regulations. U NI A 5. First aid kit available U NI A U = Unacceptable NI=Needs Improvement -5 t _ A = Acceptable DINING ROOM 1. Chairs, seats, and tables are clean and in good repair. U NI A 2. Dining area: carpet vacuumed and spot -free. Windows clean and streak -free. Tables and chairs neatly arranged. U NI A 3. Kitchen: Dish washing machine clean and sanitation procedures followed, garbage disposal operable; pots, pans and all shelving grease -free; garbage cans clean with liners; chopper, slicer and mixer clean and operable; kitchen floors clean; drains operable and clean; hoods and filters clean; refrigerators clean and organized; food stored off of the floor; food (film covered) in refrigerators and freezers; fire extinguishers current; last Health Department inspection. U NI A 4. Inventory organized and in locked storage when applicable. Two staff members take the inventories. U NI A 5. Freezers and refrigerators are at correct temperature. Sink areas clean. Grill areas clean. U NI A OFFICE 1 . Banquet information available with contracts completed and signed for each booking with deposit. Banquet histories, call reports, and files in place and current. U NI A 2. Beverage tracking form being used. Breakage being disposed of properly. U NI A SECURITY Alarm system operational, staff trained to use Fire extinguishers. U NI A Proper accounting software on P.C. U NI A Parking and clubhouse lighting adequate, functional and on time, set properly for the season: off a.m. - on p.m. U NI A Bank deposits made during daylight hours only/one day or less, of receipts in locked safe/deposits in bank daily/transfers made daily. U NI A Safe locked, not on day lock. Combination last changed U NI A U = Unacceptable NI=Needs Improvement -52- A=Acceptable Tournament contracts files with receipt attached. Deposit rung and recorded day received. U NI A Security cameras U NI A CARTS Electric Carts on site. Quantity of carts down # U NI A General Manager and cart mechanic understand and comply with agreement parts, batteries, warranties (copy of agreement in maintenance book). U NI A Maintenance records currently maintenance cardform in use/battery discharge records kept/all repairs dated/tools available. U NI A Carts cleaned daily and in good repair. Stocked with water, tees, and scorecard. U NI A Cart storage area clean. U NI A Employees demonstrate caring customer service/neat and clean/hair clean/shaved/employees in uniform with name badge/proper shoes. U NI A PERSONNEL Time clocks operational with cards available. U NI A Required state and federal forms posted by time clock. OSHA 200 form posted in clubhouse. U NI A Personnel files up to date to include key and uniform issue. Attestation forms on file for all employees. U NI A First aid kit available and adequately stocked. Phone number for emergencies, police, and fire posted. U NI A Monthly staff and safety meetings being held. Forms complete and up-to-date. U NI A New employee forms available, checklist/applications/loss prevention/employee 53- U = Unacceptable NI=Needs Improvement A = Acceptable handbook/Reid reports/payroll deduction forms/insurance enrollment cards/liability claim form. U NI A Additional personnel forms available, verbal warning/written warnings/termination checklist/liability claim form. U NI A Employee background checks U NI A LIST COMMENTSMEFICIENCIES U = Unacceptable NI=Needs Improvement -54- A = Acceptable EXHIBIT "C" CITY OF LA QUINTA SILVERROCK GOLF COURSE NOTICE OF GOLF COURSE DEFICIENCY Golf Operations Greens Tees _ Fairways & Roughs Driving Range Maintenance Records & Schedules Lakes & Water Hazards Traffic Control Maintenance Employees Maintenance Shop & Equipment Rest Room Clubhouse Operations Clubhouse Pro Shop Inventory Food & Beverage Security & Accounting Carts Personnel Statement of Deficiency Describe nature of deficiency to be corrected: Reported By: Date: Date Correction Due: Statement of Correction Describe what has or will be done to correct this deficiency: Reported By: Date: Acknowledgement of Deficiency Correction It is hereby acknowledged that the above -listed golf course deficiency has been satisfactorily corrected. City of La Quinta: By: Date: Landmark Golf Management: By: Date: -55- U = Unacceptable NI=Needs Improvement A = Acceptable ,---aN DATE pIMDNYYYI ID0412412013 ACOR"' CERTIFICATE OF LIABILITY INSURANCE0412412013 l THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the poncy(les) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement A statement on this certificate does not confer rights to the certificate holder in lieu of such endomement(s). PRODUCER Phone: (951)6945200 Fax: (951)302-0470 TEMECULA INSURANCE SERVICES 285" OLD TOWN FRONT STREET SUITE #306 .0,NERCT Ashlee Salute k PNMCDNE ) (957) 694-5200 I%AX Net. (951) 3020470 k E-MAIL ADDRESS. INSURERS) AFFORDING COVERAGE NAICa TEMECULA CA 92590 INSURER : Granite State Insurance Company INSURED LANDMARK GOLF MANAGEMENT INSURERS: Star Insurance Company 79-179 AHMANSON LANE INSURER C INSURER D: LA QUINTA CA 92253 INSURERE "YOURERF VUVCKAUCD VCR111-IVle1C l\VlnuLr�. uwu — - INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD THIS IS TO CERTIFY THAT THE POLICIES OF ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS INDICATED, NOTWITHSTANDING AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALLTHE TERMS, CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSfl LTR rypE OF INSURANCE ADOL INSR SUM WVD POLICY NUMBER POLICY Err MM—IMMIDEVII 11105112 POLICY EXP 11/05113 LIMITS EACH OCCURRENCE E 1,000,000 A GENERAL LIABILITY 02-LX-066142514-1 DAMAOE To MWD PREMISESSRES (Ee oawmce) E 300,000 X COMMERCIAL GENERAL LIABILITY MED. EXP (Any One parson) $ 15,000 CLAIMS -MADE J OCCUR PERSONAL B ADV INJURY $ 1,000,000 X Liquor Liability GENERAL AGGREGATE $ 3,000,000 PRODUCTS - COMP/OP AGG $ 3,000,000 GEN'L AGGREGATE LIMIT APPLIES PER. E PRO- POLICY JEC7 LOC A AUTOMOBILE MA&LITY 0X_ 66142514-1 -f,-L 11106112 •11105113 Mcu EDa1NOLE LIMIT Ma am4 (E $ 1,000,000 BODILY —INJURY (Par person) E ANY AUTO BODILY INJURY (Per accident) S ALL OWNED SCHEDULED AUTOS AUTOS NONIMED Ed iYocMAGE E X HIRED AUTOS X AUTOS (p.r (Per acdmnU E X OCCUR 02-LX-066142514.1 11105/12 11/05/13 EACH OCCURRENCE $ 10,000,000 A UMBRELLA Me AGGREGATE $ 20,000,000 EXCESS LIAO CLAIMS -MADE $ DED RETENTION $ B WORKERS COMPENSATION WCMSTR 0522214 12123112 12/23113 X 1'ORVTLIMITS ER $ E.L. EACH ACCIDENT s 1,000,000 AND EMPLOYERS UAeILRY YIN ANY PROPRIETONPARTNERIEXECUNVE OFFICEWMEMDER EXCLUDED? �J WA E.L. DISEASEFAEMPLOYEE $ 1,000,000 'Mnaeaa NE euer DESCRIPTION OF OPEMNONS belo E.L. DISEASE -POLICY LIMIT E 1,000,000 A Business Personal Property 02-LX-066142514-1 11/05112 11105113 $989,550 A Garegekeepers Legal UaNlity 02-LX-066142514-1 11/05112 11105/13 $10,000,000 DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES (Attach ACORD 101, Additional Remarks Schedule, H more apace is required) Certificate Holder is named as Additional Insured as respect General Liability and Loss Payee as respects Business Personal Property and Business Interruption. Waiver of Subrogation for Workers Compensation is attached. The undersigned is aware of and will comply with, Divisions 4 and 5 of the California Labor Code by securing, paying for, and maintaining In full force and effect for the duration of the Agreement, complete workers compensation Insurance, and shall furnish a certificate of Insurance to City prior to the commencement of the term of the Agreement Coverage also Includes Business Interruption Including rental value with an Actual Loss Sustained limit. r..,ro r wrinu City of La Quinta 78495 Calls Tampico La Qulnta, CA 92253 Attention: SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. Bradley J. Salute YaapLsrv.„aa, �.,�, WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY INSURANCE POLICY VV'C 04 03 06 tcd. 4-84j WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT- CALIFORNIA This endorsement changes the policy to which it is attached effective on the inception date of the policy unless a different date is indicated below. (The fcliming `attaching clause" need be completed only when this endorsement is issued subsequent to preparation of the policy.i This endorsement, effective on 12/2312012 at 12 01 AM standard time, forms a part of Policy No. WCMSTP, 0522214 Endorsement No. of the Star Insurance Company issued to Landmark Golf Management, LLC Premium (if any) $ 63 VVe have the right to recover our payments from anyone liable for an injur overed by 'this policy. We will not enforce our right against the person or organization named in the Sc , .ule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us,) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. The additional premium for this endorsement steal! be % of the California workers' compensation premium otherwise due on such remuneration. Schedule _Name Address �Jgscriptio Qperatians City of La Quinta 78945 CALLE TAMPICO Start Date 12/2312012 End Date 12123/2013 LA. QUINTA,CA,92253 Street 179179 Ahmanson Lane Zip M53 Street 2 City State La Quinta, CA Description Golf Course WC 282 (4-84) WC 04 03 08 {Ed. 4-84) Page t of 1 =,9513020470 DESERT SWST INS.BR 06:45:17 p.m. 04.16-2013 1 /2. 0 POLICY NUMBER: 02-LX-066142514-1 • COMMERCIAL GENERAL LIABILITY CG 20 26 07 04 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Persons Or Organization(s) City of La Quints 78495 Calls Tampico La Quints, CA 92253 Information required to complete this Schedule, if not shown above will be shown in the Declarations. Section II — Who Is An Insured is amended to in- clude as an additional insured the person(s) or organi- zations) shown in the Schedule, but only with respect to liability for "bodily injury", "property damage" or "personal and advertising Injury' caused, in whole or in part, by your acts or omissions or the acts or omis- sions of those acting on your behalf: A. In the performance of your ongoing operations; or B. In connection with your premises owned by or rented to you. CG 20 26 07 04 0 ISO Properties, Inc., 2004 Page 1 of 1 R =9513020470 DESERT SWST INS. BR 06:45:40 p.m. 04-16-2013 212- 1o."Leased worker" means a person leased to you by a labor leasing firm under an agreement between you and the labor leasing firm, to perform duties related to the conduct of your business. "Leased worker' does not include a "temporary worker". 11."Loading or unloading" means the handling of property. a. After it is moved from the place where it is accepted for movement into or onto an aircraft, watercraft or "auto'; b. While it is in or on an aircraft, watercraft or "auto"; or c. While it is being moved from an aircraft, water- craft or "auto" to the place where it is finally de- livered; but "loading or unloading" does'not include the movement of property by means of a mechanical device, other than a hand truck, that is not at- tached to the aircraft, watercraft or "auto". 12."Mobile equipment' means any of the following types of land vehicles, Including any attached ma- chinery or equipment a. Bulldozers, farm machinery, forklifts and other vehicles designed for use principally off public roads; b. Vehicles maintained for use solely on or next to premises you own or rent; c. Vehicles that travel on crawler treads; d. Vehicles, whether self-propelled or not, main- tained primarily to provide mobility to perma- nently mounted: (1) Power cranes, shovels, loaders, diggers or drills; or (2) Road construction or resurfacing equipment such as graders, scrapers or rollers; e. Vehicles not described in Paragraph a., b., c. or d. above that are not self-propelled and are maintained primarily to provide mobility to per- manently attached equipment of the following types: (1) Air compressors, pumps and generators, including spraying, welding, building clean- ing, geophysical exploration, lighting and well servicing equipment; or (2) Cherry pickers and similar devices used to raise or lower workers; If. Vehicles not described in Paragraph a., b., c. or d. above maintained primarily for purposes other than the transportation of persons or car- go. However, self-propelled vehicles with the fol- lowing types of permanently attached equip- ment are not "mobile equipment" but will be considered "autos": (1) Equipment designed primarily for (a) Snow removal; (b) Road maintenance, but not construction or resurfacing; or (c) Street cleaning; (2) Cherry pickers and similar devices mounted on automobile or truck chassis and used to raise or lower workers; and (3) Air compressors, pumps and generators, including spraying, welding, building clean- ing, geophysical exploration, lighting and well servicing equipment. However, "mobile equipment" does not include any land vehicles that are subject to a compulsory or financial responsibility law or other motor vehi- cle insurance law in the state where it is licensed or principally garaged. Land vehicles subject to a compulsory or financial responsibility law or other motor vehicle insurance law are considered "au- tos". 13."Occurrence" means an accident, including con- tinuous or repeated exposure to substantially the same general harmful conditions. U."Personal and advertising Injury" means injury, including consequential "bodily injury", arising out of one or more of the following offenses: a. False arrest, detention or imprisonment; b. Malicious prosecution; c. The wrongful eviction from, wrongful entry into, or Invasion of the right of private occupancy of a room, dwelling or premises that a person oc- cupies, committed by or on behalf of its owner, landlord or lessor, d. Oral or written publication, in any manner, of material that slanders or libels a person or or- ganization or disparages a person's or organi- zation's goods, products or services; e. Oral or written publication, in any manner, of material that violates a person's right of priva- cy; f. The use of anthers advertising idea in your "advertisement"; or g. Infringing upon anthers copyright, trade dress or slogan in your "advertisement'. Page U of 116 0 ISO Properties, Inc., 2006 CG 00 0112 07 17 n File Edit COmelanda Help License File Ch ge • Ge ral Information Business control: 1185 Last tivity: Created. 01/16/13 by MMENDOZA Bu ess Nameand Add s Mailing Address a LANDMARK GOLF MANAGEMENT, LLC 79179AHMANSONLN - e LA QUINTA CA 92253 1 License number: 14 00007739 -- -- Application, issue, expiration OK i01/1412073 101/1612913 —)i 1/31/2014 V _ ..---.._.- License status: LP,O _j.�' ACTIVE X [zlt Classification: FC5 `► MANAGEMENT & PUBLIC LA_T� SERVICES C'annH Exemption: 7' ii Conedescn Comments: IMANAGEMENT CO FOR SILVERROCK RESORT p- --'-------- Restrictions: APWicaredu..,` Gross receipts: 563064,00 Busli ma._ r`Reprint this license.. Tags Malmo_. I f 'Addtttonallcharges �M{scellanecus:: tmagps �I Extra regltrements j ub codes, Rettievr step...4�1 ._ Page now" N1W 78495 CALLE TAMPICO 760.777.7000 LA Qt1INTA, CA 92253 October 2, 2013 Mr. Andy Vossler Landmark Golf Management, LLC 74947 Highway 1 1 1, Suite 200 Indian Wells, CA 92210 Dear Mr. Vossler: The enclosed Golf Cart Lease Agreement by and between Landmark Golf Management (the "Lessee") and Wells Fargo (the "Lessor"), is hereby approved as to form, content, and vendor. This approval is pursuant to and within the meaning of Section 3.6 of the Golf Course Management Agreement by and between the City of La Quinta and Landmark Golf Management, dated July 1, 2013. If you have any questions or require additional information, please contact Edie Hylton, Community•Services Director, at 760-777-7032. FS/sh cc: Edie Hylton, Community Services Director Steve Howlett, Golf and Parks/Landscape Manager \\C1gadmfs1\comsrv\Staff Folders\Steve\Letters\Letters 2013\100213 Cart Lease.doc GEM of the DESERT RUTAN • f2UTAN 6 TUCKER, LLP October 16, 2013 Wells Fargo Financial Leasing, Inc. 800 Walnut Street MAC F4031-050 Des Moines, Iowa 50309 M. Katherine Jenson Direct Dial: (714) 641-3413 E-mail: kjenson@rutan,com Re: Guaranty dated November 1, 2013, executed by City of La Quinta ("Guarantor") in favor of Wells Fargo Financial Leasing, Inc. ("Wells Fargo") To Whom It May Concern: As counsel for City of La Quinta, the above -referenced Guarantor, I have examined the above -referenced Guaranty of Lease, dated November 1, 2013, of that certain Master Lease Agreement between Landmark Golf Management, LLC ("Lessee") and Wells Fargo, and the proceedings taken by the governing body of Guarantor to authorize on behalf of Guarantor the execution and delivery of the Guaranty. Based upon the foregoing examination and upon an examination of such other documents and matters of law as I have deemed necessary or appropriate, I am of the opinion that: 1. Guarantor has the requisite power and authority to execute and deliver the Guaranty and to perform its obligations under the Guaranty. 2. The Guaranty has been duly authorized, executed and delivered by Guarantor and the Guaranty constitutes a legal, valid and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, subject to any applicable bankruptcy, insolvency, moratorium or other laws or equitable principles affecting the enforcement of creditors' rights generally, 3. The authorization, approval, execution and delivery of the Guaranty and all other proceedings of Guarantor's governing body relating to the transactions contemplated by the Guaranty have been performed in accordance with all applicable state laws and all actions, approvals, authorizations and consents necessary to authorize Guarantor's execution, delivery and performance of the Guaranty have occurred or been obtained. 4. No litigation or proceeding is pending or, to the best of my knowledge, threatened to restrain or enjoin the execution, delivery or performance by Guarantor of the Guaranty or in any way to contest the validity of the Guaranty, to contest or question the creation or existence of Guarantor or its governing body or the authority or ability of Guarantor to execute or deliver the Guaranty or to comply with or perform its obligations thereunder. 611 Anton Blvd, Suite 1400, Costa Mesa, CA 92626 PO Box 1950, Costa Mesa, CA 92628-1950 1 714.641.5100 1 Fax 714.546.9035 119/015610-0065 6236920.3a10/14/13 Oranae Countv I Palo Alto I www.rutan.r.nm RUTAN Att01kNEY3 At LAW Wells Fargo Financial Leasing, Inc. October 16, 2013 Page 2 5. The entering into and performance of the Guaranty does not and will not violate any judgment, order, law or regulation applicable to Guarantor or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest or other encumbrance upon any assets of Guarantor pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement or other instrument to which Guarantor is a party or by which it or its assets may be bound. 6. The execution and delivery of the Guaranty and Guarantor's performance thereunder do not result in the violation of any constitutional, statutory or other limitation relating to the manner, form or amount of indebtedness or liabilities which may be incurred by the Guarantor. Respectfully submitted, MKJ:lr 119/015610-0065 6236920.3 al0/14/13 Guaranty of ease Title of underlying agreement: Master Lease Agreement Name of uncleHying lessee or borrower: Landmark Golf Management, LLC This Guaranty Is, made effective the 1s�day of November 2013, by the undersigned City of La Quinta, a body corporate and politic eAsting:under the laws of the State of California (the "Guarantor"), In favor of Wells Fargo Financial Leasing, Inc., a corporation organized and existing under the laws of the State of Iowa ('Wells Fargo"), Its successors and assigns. Recitals: Whereas, Wells Fargo is contemporaneously herewith entering Into the above -referenced master lease (the "Master Lease") with the above -referenced lessee (the "Debtor"), pursuant to which Wells Fargo and Debtor may from time to time enter into one or more lease schedules thereto (each a "Schedule" and together with the terms and conditions of the Master Lease incorporated therein by reference, the "Underlying Agreement"),' and Whereas, It is a condition precedent to Wells Fargo's entering into and performing pursuant to the Underlying Agreement that Guarantor unconditionally and absolutely guaranty Debtor's complete and timely performance of all of Debtor's obligations under the Underlying Agreement and all other documents and agreements entered into pursuant to or In connection with the Underlying Agreement, pursuant to the terms and conditions of this Guaranty, and Whereas, Guarantor has represented to Wells Fargo that It is In the direct interest and to the direct economic benefit of Guarantor that Wells Fargo enter Into and perform pursuant to the Underlying Agreement, and therefore, subject only to Section 13 below, Guarantor has agreed to unconditionally and absolutely guaranty Debtor's complete and timely performance of all of Debtor's obligations set forth in the Underlying Agreement, as more particularly set forth below; Now, Therefore, In order to induce Wells Fargo to enter into the Underlying Agreement and perform thereunder, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, Guarantor does hereby covenant and agree vvfth Wells Fargo as follows: 1. As used in this Guaranty, the tern "Underlying Agreement" shall indude any and all other documents and agreements entered into pursuant to or In connection with the.Underlying:Agreement, and any all future amendments, modifications and/or extensions thereof. 2. Subject only to Section 13 below, Guarantor hereby unconditionally, irrevocably and absolutely guarantees to Wells Fargo, its successors and assigns: (a) that all sums now or hereafter due Wells Fargo from Debtor under the Underlying Agreement (Including without limltaVon, interest, damages, costs, expenses, attomeys' fees and penalties) will be fully paid when and as due, whether by acceleration or otherwise, without delinquency or default; and (b) the complete and timely performance by Debtor of all the terms, promises, conditions and covenants of the Underlying Agreement. 3. In the event of any default by Debtor in the payment of any amount due and/or the performance of any of its other obligations, at any Ume and from fime-to•tlme, under the Underlying Agreement, Guarantor shall fully pay, perform and discharge the same. Guarantor shall pay, perform and discharge all obligations hereunder upon demand by Wells Fargo, and covenants and agrees that Wells Fargo may proceed directly against Guarantor without first proceeding or making claim or exhausting any remedy against Debtor, any, other third party, any other guarantor, or any properly, or pursuing any particular remedy or remedies available to Wells Fargo. Guarantor agrees to pay to Wells Fargo all of Wells Fargo's costs, expenses and reasonable attorneys' fees incurred in enforcing the terms of the Underlying Agreement and/or this Guaranty. Guarantor shall be and remain liable for any deficiency following the foreclosure of any collateral securing the Underlying Agreement, whether or not the iiability of Debtor thereunder is discharged by such foreclosure. Notwithstanding anything In this Section 3 or any provision in this Guaranty to the contrary, Guarantor's obligations hereunder shall in all respects be limited by the terms and conditions of Section 13 below. 4. Guarantor hereby uncond4lonally waives notice of acceptance of this Guaranty, presentment, protest, notice of protest, demand, dishonor, notice of the creation and existence of any future indebtedness, diligence, notice of non-performance, non-payment, default or breach by Debtor, and any and all other defenses based on suretyship or Impairment of collateral, and all demands for performance and any and all notices that might otherwise be a condition precedent to the ttab[[Ity of Guarantor under this Guaranty. b. Guarantor covenants and agrees that, without releasing, diminishing or otherwise affecting the liability of Guarantor or the performance of any obligation contained in this Guaranty, and without affecting the rights of Wells Fargo hereunder, Wells Fargo may, at any time and from time -to - time, and without notice to or further consent of Guarantor: (a) make any agreement extending or reducing the term of any or all of the Underlying Agreement, or otherwise altering the terms of payment of all or any part of any sum due thereunder, or any other obligation of Debtor, or granting any indulgences or Extensions with respect to any of these matters, or modifying or otherwise dealing with any such agreement or obligation; (b) exercise or refrain from exercising or waiving any right Wells Fargo may have; (c) accept security of any kind from Debtor and/or any other party; and/or (d) consent to any assignment by Debtor, its successors and/or assigns, made with or without notice to Guarantor. & Guarantor agrees that, in the event of any one or more of the following, neither Guarantor's obligation to make payments in accordance with the terms of this Guaranty, nor any remedy for the enforcement of this Guaranty, shall be Impaired, modified, changed, released or limited in any manner whatsoever by any impairment, modification, change, release or limitation of the liability of Debtor or its estate in bankruptcy or of any remedy for the enforcement resulting from the operation of any present or future ,provision of the federal Bankruptcy Code or from the decision of any court, to wit: (a) Debtor shall become insolvent or shall be adjudicated a bankrupt; (b) Debtor shall rile a petition for reorganization, arrangement or similar relief under any present or future provision of the federal Bankruptcy Code; (c) a petition for reorganization, arrangement or similar relief under any present or future provision of the federal Bankruptcy Code filed by one or more creditors #489533 v1 Page 1 of 3 of Debtor shall be approved by a court; (d) Debtor shall seek a judicial readjustment of the rights of its creciltors under any present or future federal or state law; and/or (a) a receiver of all or part of Debtor's property and assets is appointed by any state or federal court, and In any such proceeding any of the Underlying Agreement shall be terminated or rejected or the obligations of Debtor thereunder shall be modified, in which case Guarantor shall immediately pay to Wells Fargo, its successors or assigns, an amount equal to the sum of: (i) all amounts due or delinquent as of the date of the termination, rejection or modification, (li) all other amounts due or to become due Wells Fargo under the terms of the Underlying Agreement (including withoutlimltatlon, Interest, damages, costs, expenses, attorneys' fees and penalties), and (tit) Interest on the amounts listed in (I) through (iii), above, at the rate of eighteen percent (18%) per annum, or at the highest rate allowed by applicable law, whichever rate Is lower, from the date of the termination, rejection or modification to the date of payment. i. Guarantor's obligations hereunder shall not be affected, impaired or diminished by reason of Wells Fargo's receipt of any other guaranty or surety or any benefit of recourse in connection with any of the Underlying Agreement. 8.: Guarantor; agrees to not obtain reimbursement or payment from Debtor or any other person or entity obligated with respect to any of the Underlying Agreement, or from any.coilateral therefore, until the obligations under such Underlying Agreement have been fully satisfied. 9: Thia Guaranty shall be binding upon Guarantor, its successors. and assigns. Guarantor may not assign this Guaranty or any of its obligations hereunder„ in whole or part. Wells Fargo may assign all or any part Its rights under this Guaranty without notice to Guarantor, in which case this Guaranty shall inure to the benefit of any such assignee with the same force and effect as though the assignee was specifically named in this Guaranty. No invalidity, irregularity or unenforceability of all or any part of the obligations and liabilities hereby guaranteed, or of any security therefor, shall affect, Impair or be a defense to this Guaranty. This Guaranty is a primary obligation of Guarantor. Without limiting the generality of the foregoing. Guarantor hereby waives any defense arising by reason of any disability of Debtor. Wells Fargo's failure to exercise any of its rights hereunder shall not operate as a waiver of said rights. Each provision In this Guaranty shall be interpreted in such a manner as to be effective and valid under applicable taw. in the event any one or more provisions of this Guaranty are determined to be unenforceable, the remainder of this Guaranty shall remain In effect. A facsimile or other copy of this Guaranty shall have the full force and effect of the original. 10. This Guaranty shall be governed by and interpreted In accordance with the laws of the State of Callfomia. Any and all actions or proceedings arising directly or indirectly from this Guaranty shall be litigated In courts having a situs within the State of California. Guarantor consents to the personal jurisdiction of any local, state or federal court located within the State of California. 11. Guarantor agrees that, so long as any obligations of Debtor remain under the Underlying Agreement or any obligations of Guarantor remain under this Guaranty, (A) all claims, demands, liens and security interests, now existing or arising in the future, if any, of Guarantor against the Debtor, arising or growing out of any indebtedness, liability, obligation or other responsibility, due or to become due by Debtor to Guarantor (collectively, "Guarantor Interests") are hereby expressly made subordinate and junior in right of payment and in lien priority to all of the Debtor's obligations to Wells Fargo under or relating to the Underlying Agreement (including, without limitation, any claim, demand, lien or security Interest that accrued after the commencement of any proceeding relating to the bankruptcy, insolvency or reorganization of the Debtor to the extent Wells Fargo has the right to receive the same from Debtor), and (13) Guarantor shall not accept any payment or other thing of value from Debtor with respect to any Guarantor Interests. This Guaranty contains the entire agreement between Guarantor and Wells Fargo with respect to Guarantor's guaranty of the Debtor's obligations under the Underlying Agreement. This Guaranty may be modified only in writing signed by Guarantor and an executive officer of Wells Fargo. Guarantor and Wells Fargo agree that a photocopy, carbon copy, facsimile or other reproduction of this Guaranty with Guarantor's reproduced signature thereon shall be as valid and binding as the original -signature document and shall be treated as genuine and authentic as the original for all purposes. 13. Guarantor hereby represents, warrants and covenants to Wells Fargo that: (a) Guarantor Intends, subject only to the provisions of this Section, to remit to Wells Fargo all sums due and to become due hereunder for the full multi -year term of the Underlying Agreement; (b) Guarantor's governing body has appropriated sufficient funds to pay all amounts due to Wells Fargo during Guarantor's current fiscal perlod; (c) Guarantor reasonably believes that legally available funds in an amount suMclent to make all such payments for the full multi -year term of the Underlying Agreement can be obtained; and (d) Guarantor intends to do all things lawfully within Its power to obtain and maintain funds From which all such payments to become due during the full multi -year term of the Underlying Agreement, including making provision for such payments to the extent necessary in each budget or appropriation request submitted and adopted in accordance with applicable law. Notwithstanding the foregoing, the decision whether or not to budget and appropriate funds is within the discretion of Guarantor's governing body. in the event Guarantor's governing body fails to appropriate sufficient funds to make allpayments and pay other amounts due and to became due during next fiscal period, Guarantor may, subject to the terms hereof, terminate this Guaranty as of the last day of the fiscal ,period for which appropriations ware received (an "Event of Non-approprlatlon"). Guarantor agrees to deliver notice of an Event of Non•appropriatlon to Wells Fargo at least 30 days prior to the end of Guarantors then -current fiscal period, or if an Event of Non -appropriation has not occurred by that date, promptly upon the occurrence of any such Event of Non -appropriation. Guarantor and. by its acceptance of this Guaranty, Wells Fargo, understand and intend that Guarantor's obligation to make payments and pay other amounts due under this Guaranty shall constitute a current expense and shall not in any way be construed to be a debt in contravention of any applicable constitutional or statutory limitations or requirements concerning Guarantor's creation of indebtedness, nor shall anything contained herein constitute a pledge of Guarantor's general tax revenues, funds or monies. 14. Guarantor hereby represents, warrants and covenants to Wells Fargo that: (a) Guarantor has the power and authority under applicable law to enter Into this Guaranty and the transactions contemplated herein and to perform all of its obligations hereunder, (b) Guarantor has duly authorized the execution and delivery of this Guaranty by appropriate official action of its governing body and has obtained such other authorizations, consents and/or approvals as are necessary to consummate this Guaranty, (c) all legal and other requirements have been met, and procedures have occurred, to render this Guaranty enforceable against Guarantor in accordance with its terms, (d) upon Wells Fargo's request, Guarantor will provide Wells Fargo with a copy of Guarantor's current financial statements within 150 days after the end of each fiscal period, and (e)during the term of the Underlying Agreement, unless and until this Guaranty is terminated in accordance with Section 13 above, Guarantor shall provide to Wells Fargo, no later than 10 days prior to the end of each fiscal period, with current budgets or other proof of appropriation for the ensuing fiscal period, and such other financial information relating to Guarantor's ability to continue this Guaranty, as Wells Fargo may request. Guarantor hereby acknowledges that the representations, warranties and covenants made by Guarantor In this Guaranty are being materially relied upon by Wells Fargo In entering into the Underlying Agreement. 15. ARBITRATION #489533 A Page 2 of 3 (a) 6011raflo . The parties hereto agree, upon demand by any party, to submit to binding arbitration ail claims, disputes and controversies between or among them (and their respective employees, officers, directors, attorneys, and other agents), wtaether In tort, contract or otherwise, In any way arising out of or relating to this Guaranty and Its negotiation, execution, ooilateralization, administration, repayment, modfffcation,.6tenslon, substitution, formation, Inducement, enforcement, default or termination. (b) Govcrnlnq Rules, Any arbitration proceeding wilt (I) proceed In a location In California selected by the American Arbitration Association ('AAA"); (II) be governed by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law provision In any of the documents between the parties; and (III) be conducted by the AAA, or such other administrator as the parties shall mutually agree upon, In accordance with the AAA's commercial dispute resolution procedures, unless the cialm or counterclaim is at least $1,000,000.00 exclusive of ciaimed Interest, arbitration fees and costs in -which case the arbitration shall be conducted In accordance with the AAA's optional procedures for large, complex commercial disputes (the commorclal dispute resolution procedures or the optional procedures for large. complex commercial disputes to be referred to herein, as applicable, as the 'Rules'). If there is any Inconsistency between the terms hereof and the Rules, the terms and procedures set forth herein shall control. Any party who'falls-or refuses to submit to arbitration following a demand by any other party shall bear.all casts and expenses incurred by such other party In compelling arbitration of any dispute. Nothing contained herein shall be deemed to be a waiver by any party that is a bank of the protections afforded to It under 12 U.S.C. §91 or any similar applicable state law. (c) aiyer of Provisional Remedies Self -Help and Foreclosure. The arbitration requirement does not limit the right of any party to (I) -fore -close against collateral; (H) exercise self-help remedies relating to collateral or proceeds of collateral such as setoff or repossession; or (i€€) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the appointment of a receiver, before during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of the right or obligation of any parry to submit any dispute to arbitration or reference hereunder, including those arising from the exercise of the actions detailed In sections (i), (€1) and (Ili) of this subsection (c). (d) Arb€tooter Qualifications and P, wets. Any arbltratlon proceeding In which the amount In controversy is $5,000,000.00 or less will be decided by a single arbitrator selected according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount In controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel of three arbitrators; provided however, that all three arbitrators must actively participate in all hearings and dellberations. The arbitrator will be a neutral attorney licensed In the State of California or a neutral retired Judge of the state or federal judiciary of California, In either case with a minimum of ten years experience In the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not an Issue is arbilratable and will give effect to the statutes of limitation in determining any claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a hearing at the arbitrators discretion) any pro -hearing motions which are similar to motions to dlsmiss for failure to state a claim or motions for summary adjudlgtiori. The arbitrator shall resolve all disputes in accordanco with the substantive law of California and may grant any remedy or relief that a court of such state could order or grant within the scope hereof and such ancillary relief as is necessary to make effective any award. The arbitrator shall also have the power to award recovery of all costs and fees, to Impose sanctions and to take such other action as the arbitrator deems necessary to the same extent a fudge could pursuant to the Federal Rules of Civil Procedure, the Callfomfa Rules of Civil Procedure or other applicable law, Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. The Institution and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy shall not constitute a waiver of the right of any party, Including the plairill If, to submit the controversy or ciafm to arbitration If any other party contests such action for judicial relief. (e) Dlscaverv. In any arbitration proceeding; discovery will tie permitted In accordance with the Rules. All discovery shall be expressly limited to matters directly relevant to the dispute being arbitrated and must be completed no later than 20 days before the hearing date. Any. requests for an extension of the discovery periods, or any discovery disputes, will be subject to tonal determination by the arbitrator upon a showing that the request for discovery is essential for the party's presentation and that no aftemativa means for obtaining Information Is available. (f) Cass Prcceedina§ and Consolfdatlons. No party hereto shall be.endlied to join or consolidate disputes by or against others in any arbitration, except parties who have executed this Guaranty or any other contract, instrument or document relating to the Underlying Agreement, or to include In any arbitration any dispute as a representative or member of a Gass, or to actin any arbitratjon In the interest of the general public or In a private attorney general capacity. (9) egyrnt n7 pf Rrbi(rat€on Costs and Fees. The arbitrator shall award all costs and expenses of the arbitration proceeding, (h) Mlscellaneous. To the maximum extent practicable, the AAA, the arbitrators and the parties shall take all action required to conclude any arbllratlon proceeding within 180 days of the filing of the dispute with the AAA.. No arbitrator or other party to an arbitration proceeding may disclose the existence, content or results thereof, except for disclosures of Information by a party required in the ordinary course of its business or by applicable law or regulation. If more than one agreement for arbitration by or between the parties potentially applies to a dispute, the arbitration provision most directly related to the documents between the parties or ilia subject matter of the dispute shall control. This arbitration provision shall survive termination, amendment or explration of any of the documents or any relationship between the parties. In witness whereof, Guarantor has executed this Guaranty effective the day and year first set forth above. GUARANTOR., Cit of La uinta Frank. Spewac Cit a alter City of La Quin a, Caiifo a #489533 A Page 3 of 3 Master Lease Agreement Master Lease Agreement # dated Lasses (full legal harts) Fed Tax to: Co -Lessee (full legal name) Fed Tax ID: Landmark Golf Management, L. C 20-0936865 Address Address 79-179 Ahmanson Lane city S ale County Zlp Code Oty Stale County Zip Code LBQUInte Riverstdo 9225$ In this Master Lease Agreamen (this "Master Agreement"), the words "You" and "Your" refer to the Lessee (or if a co -Lessee Is Indicated above, the Lessee and Co -Lessee, vintl and severall Indicated ove. The words "We," "Us" and "Our" refer to Wells Faro Financial Leasing, Inc. 1. LEASE OF EQUIPMENT. We gran to lease to You, and You agree to lease from Us, the equipment listed on each Equipment replacements, substitutions, roplace Lea" Schaduie (together with all accessories, attachments, a Termination Buyout, which will be an amount determined by Us in Our sole discretion based upon the nt pens, additions and repairs now or hereafter Incorporated therein, affixed thereto or used in Conn. following factors: (i) Lease Payments then due, (tt) the present value of all remaining future Lease r Uon herewith, the "Equipment") now or hereafter executed by Payments, (iii) the present value of the booked residual of the applicable Equipment, and (fv) other You and Us (each, a "Schedule"'), k4,on Incorporated therein, this Master Agree the terms and conditions set forth in the Schedule and, as amounts due or to become due under the Lease; and (2) an Option Expiration Dale. In order for You to riont. Each Schedule shall be in form and substance acceptable to Us, shall Inoorporals all of the lormi exercise the Termination Option, We must receive Your payment of the Termination Buyout on or before and conditions of this Master Agreement, and shall constitute a the Option Expiration Dale, In which case You shell purchase the applicable Equipment for the amount ;operate Issue between You and Va. entered Into In accordance with this Sai At used herein, the term "Leese" shall refer to each Schedule of the Termination Option "AS IS, WHERE IS" from Us. You will be solely responsible for any and all lion 1. In the event of any conflict between the provisions of this Master Agreement and the provisions taxes and other charges associated with Your purchase of Equipment. If We do not receive Your f any Schedule, the provisions of this Master Agreement shall payment of the Termination Buyout on or before the Option Expiration Dale, the Termination Option will :anlrol. You promise to pay to Us the ease Payment Indicated In each Lease, plus all other amounts automatically expire. :hat may become due under each Leos . !. MISCELLANEOUS. The pay nt amounts shown on each Lease may not Include any or all a. AUTOMATIC RENEWAL; PURCHASE OPTION. With respect to east Lease: ippficabia Taxesin addition, You out rite Us to Insert or correct missing or Incorrect Information on A. Orlolnel Tarrn Provisions. The following tars apply during the Original Term of the Lease his Master Agreement or any Lease a any time. You agree to all the terms and conditions set forth on unless the Original Term Purchase Option Price set forth in the Lease Is $1.00 (in which case his page and those set forth on the n I pagalraverse side of [No Master Agreement, that those lafms Subsection C., below, Is applicable): ind conditions are a complete and ex volvo atalemant of Our agreement, that [hey supersede all prior (1) Automatic Renewal; Exercise of Other Options, Unless You notify Us In writing at rral or written negotiations, underalen Ings and commitments, and that they may be madlflad only by least 60 days before the end of the Original Term that You Intend to either exercise the vrltlan agreement between You and U , Ora[ or written promises or agreements that are not mitten In Purchase Option (If any) described In Subsection (2), below, or return the Equipment at his Master Agreement (Induding, wll out iirnilalion, Ihuss contained In any purcheso agreement or the and of the Original Term, then: udor entered into or Issued in canna .ease shall not be bindingupon Us. Po Bon with the Equipment andfor [No Master Agreement of any renew (a) If a Renewal Term is eel forth In the Lease: (t) the Leese will Any delay or failure In Our etNordng any right or asking any emedy conferred herein or otherwise Immediately for that Renewal Term, (ii) the Renewal Tenn will commence Immediately upon the up ohall not constitute a waiver of any such right or remody. You expiration of the Original Term on the same terms and conditions except the amount of epresent, warrant and agree that the F iersonal, family or household purposes. qu[pmant will be used for commercial purposes only and not for each Lease Payment shall be equal to the Renewal Lease Payment Indicated In the Headings and lNes of sections are included for convenience mly, and are not substantive provisions Lease, and (tit) the first Renewal Lease Payment will be due on the first day of the of this Mosier Lease. This Master Lease and each Lease may ,e executed In any number of counlorf Renewal Term; or ans, each of which shell be deemed to be an original, but all of Rilch togelhar eholl Consillute the ear is Instrument. You acknowledge that You have received of a (b) If no Renewal Term Is set forth in the Lease, You will return the Equipment opy of this Master Agreement and jig as that a facsimile or other copy of this Master Agreement and immediately upon the expiration of the Original Term In accordance with Section 15 of this ach Lasso shall be as enforceable nit the original executed Master Agreement. This Master Master Lease. tgreemenl Is not binding upon on Us unless and until We accept It by signing below. If You are a If You do notify Us in writing within the time period set forth above that You intend to return artnershlp or a Corporation, LLC or o r legal onttty, Yeu represent and warrant that that the executfon the Equipment at the and of such Term, You shall return the Equipment pursuant to Section rid dallvery of this Master Atimomant nd Your performance of Your obligations haraunder have been 15 of this Lease. If you do notify Us in writing within the time period set forth above that You my oulhonzed by ail naceseary Campo y action, and [het the person signing No Master Agreement an Intend to exercise the Purchase Option (if any) described In Subsection (2), below, You shell 'our behalf has been duly authorized a do so. You reprosenl and warrant that all of the Informoliort purchase the Equipment from Us immediately upon the expiration of the Original Term under ubmllled to Us In connection with this Jailor Agreement and each Lease (including, without limitation, the terms and conditions set forth in Subsection (2), below. iformation contained in the credit oppli at forth above am true and correct I lion and any financial statements) and the Lessee information (2) purchase Option. Subject to Subsection (1), above, so long as You are not in default ima Is of the essence of this Master Agreement and each ease, This Master Agreement nor s under this Master Lease, If a there Is an amount set forth In the Lease as a Original term iy Leese Is binding upon on Us until We accept by signing the ame. You may not terminate any Lens Purchase Option Price, You shall have the option to purchase the Equipment at the and of the except in accordance with Section 5 of this Master Agreement. ORIGINAL TERM OF LEASE.7 Original Term of the Lease "AS IS, WHERE IS" for that price. You will be solely responsible a Original Term of each Lease will begin on a date designated for any and all taxes and other charges associated with Your purchase of Equipment. We by Us after We have executed a Lease and receved all required documentation (the shall not have any delivery obligations with respect to any Equipment. "Commencement Date") and will continue for the number of months designated as the Original Term "Term" B. R¢n¢waProvisions Term Proy; sions fAutgm� Ic fjen xw�l}. The following terms apply during each on the Loose. As used herein, shall mean, with respect to each Lease, the Original Term , __ Renewal term (if any) the Lease: (including any extension thereof) and each Renewal Term entered Into pursuant to Section a of this MoslerAgreomonl. Unless You notify Us In writing at least 60 days before the and of the then -current 4. LEASE PAYMENTS. You agree to pay Us the amount specified In each Lease as the Lease Renewal Term that You Intend to return the Equipment at the end of that Renewal Term, then: (1) the Lease will automatically renew for an additional Renewal Term, (it) the additional Payment Amount (plus any and a0 applicable Texas) when each ouch payment is due (each, a "Lassa Payment"). Unless We notify You In writing otherwise, all Lease Payments era payable In advanco Renewal Term will commence Immediately upon the expiration of the then -current Renewal pariod[catiy as elated In each Lease. If you choose to make pnymonts alectron[cally, We will provide Term on the some terms and conditions, and (iii) the first Renewal Lease Payment for the You with an Authorization Agreement for Electronic Payments. Restrictive endarsemenfs on checks You additional Renewal Term will be due on the first day of the additional Renewal Term. -tend to Us vAl not reduce Your obllgationo to Us. All payments received will be applied to pest due If You do notify Us In writing within the time period set forth above that You Intend to return balances, Taxes, fees, late Charges and the current amount then due, or In such order as We may. from the Equipment at the end of the then -current Renewal Term, You shall return the Equipment lime•loArna, determine. To the extent permitted by appllcabto law: (a) each time a Lassa Payment pursuant to Section 15 of this Lease. or other amount la not received by Us within tan (10) days of its due data, You agree to pay Us is C. 51.00 Purchase Onion_ Provisions. Notwithstanding the provisions in Subsections A. and B. late charge equal to 5% of the amount that Is late (or the maximum amount psrr"Ithid by above, If the Original Term Purchase Option Price in the Lease is $1.00, You shall have the applicable law If lass) and (b) It any check You sand to U■ Is returned for Insufficient funds or option to purchase the Equipment at the end of the Original Term of the Lease "At IS WHERE, any other reason, You agree to pay Us, within 30 days, a fee equal to $20.00. IS" for $1.00 so long as (I) You have fully complied wilh the terms and conditions of the Leese, 5. EARLY TERMINATION. So long as You do notdefault under any Lasso or other agreement (it) the Lease has not been terminated, and (III) all of Your obligations under the Lease have been between You and Us. You may torminals any Lease (In whole or with respect to any specific ICorno of satisfied. You will be solely responsible for any and all taxes and other charges associated with Equipment) before the axplrallon of any Tarn as follows., (z) You may submit to Us a wdllan request for Your purchase of the Equipment. We shall not have any delivery obligations with respect to any early termination that idenfffies the appllcable Loose and the Equipment You wish to purchase; and (0) Equipment. After We receive Your raquasl, We witl provide You with a written Torminaflon Option that includes., (1) Lessee: Landmark Golf Management, LLC Co -Lessee: By: Dale: 0 F .+ Name/Tide: Andy Vossler, President Lessor: WELLS FARGO FINANCIAL LEASING, INC. By: Date: Des Moines, Iowa Terms and conditions of this Master Agreement are continued on the reverse aide/Page 2 hereof. By: Namerritle: Date: #1997282 v2 (03/27/13) Page 1 of 2 7. DELIVERY, LgCAtIDN AND OWNERSHIP OF EQUIPMENT. You will keep and us■ the Equipment only at the Equipment locatiah Address Identified In tha applicable Lease. The Equipment shaft not be ramoved frnn that eddrels unless You first get Our written permission to move it You shed give Us and any designee of Ours access to the promises where the Equipment Is located so that We (or Our designee) may inspect the Equlpment'e axlelence, loeallon, Inetalfallon, condition and/or proper meinlenencs. We era the owner of Ina Equipment and have title to the Equipment. All roplecomont parts, accaasorles and repairs will become Our property. You shall keep the Equipment free and clear of al mortgages, pledges, security Interests, liens, levies, ancumbrancas, daims and any other chofgas (other than home specifically created or permitted In writing by Us), and shaft not cause or psrmil any Equlpmanl to become snachad or affixed to real property. You agree tha Equipment la and short remain personal property. 8. NO WARRANTIES. WE ARE LEASING THE EQUIPMENT TO YOU "AS IS". WE HAVE NOT 1181SAW?16A ft- fl"HAN I AdILIIT ANO FIINES EOR A PART19ULAR PURPOSE. You are entitled under Article, 2A of the Uniform Commercial Cade (as existing and as hereafter amended from Ume-to•timre, the "UCC") to the promilass and warranties (including those of any third party) provided lc Us by the abova-raterencad supplier of the Equipment (the "SupplNi") In connection with or so part of The sonbod Or any) by which We acquire the Equlpmeni, and You may communicate with the Supplier and recolve an accurate and complete statement of those promises and warranties (Including any disclalmors and Ilmllaflons of them or of remedial). We transfer to You for the Term of the applfcabla Leese all automatically transferable warranties. If any, made by the manufaclurer or Supplier to Us relative to the Equipment. We era not liable to You for arty madification(s) or rescission(s) of any Supplier or manufacturer warranties, nor for Ohs failure to comply Iherewllh, 9. USE AND MAINTENANCE You shall use and care for the Equipment In a careful and prudent manner. You Shall operate and maintain the Equlpmanl In accordance with the manufacturers operator's manuals, rnefn[ananos manuals, tachnIcal manuals, all other instructions concerning cporstlon and maintenance and In a000dance with sit Iowa and regulations and policies at Insurance. You Shag, at Your own cost, perform all marntenenea and make any and all repairs which rosy be necessary to keep, the Equlpmom in as good condition as It was when delivered Io You (except for ordinary wear and tear) and You shall keep It ailglible for any and all suppllar`s and manufacturer's conifications and standard full service mwlntamence contracts. You shall not make any pormmneni alterations to the Equipment. The Equipment shall net be operated for more. than the Maximum Numb*r of Hour* shown on the sppllcablo Loss* and You Surat to pay the excess use charge shown an such Les" for each hour In* Equipment Is used In sxcsos of such time. If a molar Is provided, You agree to keep It connadod to Ohe Equ[pritant and operational at sit times. 10. LOSS; DAMAGE; INSURANCE. You shall bear the oak of loos or damage to the Equipment (Indud it g, without limitation, lass or damage occurring during shipment andlor delivery of the Equipment to You and Equipment installation) and are responsible for protecting the Equipment from damage (except for ordinary wear and teor) and Iosees until the Equipment Is rocalved by Us or Our designee pursuant to Sactfon 15 of [his Master Agreement, or until the exaltation of the Term, whichever occurs later. If the Equlpmani is damaged or Joel, You agree to continue to make all Leaaa Payments when and as they become due and to otherwise continue to fully perform In accordance with the limn and condltbno of this Master Agreement and each Leese, Until the Equipment Is received by Us or Our dealgnes pursuant to Section 15 of this Mailer Agreement, or until the expiration of the Term of the applicable Lease, whichever occurs later, You shall, at Your own expense: (a) keep the Equipment Insured agslhst sli rake of toes in an amount at least equal to its full replacement met (without deductible and without co-krsuranoo) and name Us me the Sol In$a payee on such property Insurance, and (b) carry public tiablllty Insurance coveting contractual Ilabifity on the Equipment, personal Injury and property dernagS of at teaal $1,000,000 per occurrence for bodity Injury, Including death and $250.00D for property damage and name Us as on additional Insured on such liability insurance. The tarts of oath insurance policy required heroin shall oKpraosly require at least 30 days Prior written notice to Us before It may be cancelled, terminated or modlrtad by You or the Insurer. WE MAKE NO REPRESENTATIONS OR WARRANTIES REGARDING THE ADEQUACY OF THE MINIMUM INSURANCE REQUIREMENTS SET FORTH ABOVE. Yam hereby Irrevocably appoint Us Your al(omsy-in-fag to sign Your nome to any documeml(s) for the purpose of making claims for, receiving paymenl(s) of and/or to exscmta end endorse all checks, drafts or olhordocuments rar any 1%41111y, lea* or damage under any Inauranne polcy. Prior to the Commencement Date, You shalt provide UK with written proof that You have obtained the Insurance deacAlled above In fora and substance acceptable to UK and Shall provide Us notice of any chongas in such Insurance and continuo to maintain insurance In such amounts throughout the term of the Lease. 11. ASSIGNMENT. YOU HAVE NO RIGHT TO AND SHALL NOT SELL, TRANSFER,. ASSIGN PLEDGE, GRANT A SECURITY INTEREST IN OR SUBLEASE ANY EQUIPMENT COVERED BY THIS MASTER AGREEMENT OR ANY LEASE IN WHOLE OR IN PART. We may, without notice to You, sell, assign pledge, grant a security Interest or participation In, or transfer this Master Agreement any or all Leases and/or, oubjec! Io Your rights undor this Master Agreomanl and each Lasso, any Equipment, In which case the new ovmer, asolgnoe or socurod party will, to the extent or such onto, ass+gnmenl, pledge, so[urity Inlereet or partidpadon, have ail of Our rights end bonefits under INS Masler Agraoment and each Lease, but will not have to perform any of Our obligations (If any). You agree not to assert against the new owner, assignee or secured party any claim or defense that You may have against Us or any other predecessor In Interest. We may, without notice to You, release any Information that We may have or obtain about You, this Master Agreement, each Lease and/or the Equipment to the Equipment manufacturer, the Supplier andfor any actual or prospective assignee, participant or Investor of Ours. 12. TAXES AND OTHER FEES. You shall be solely liable for all sales and use taxes, personal property taxes, wlthholdIngs, levies, Impositions, duties, assessments and all other [axes and charges, license and registration fees, relating to the ownership, leasing, rental, sale, purchase, possession or use of the Equipment as part of each Leese or as billed by Us (coWctiva!y, "Taxes"). The Taxes indicated on each Lasso ere sailmates and are subject to chw,.Oo.. You authorize Us to pay any Taxes when and as they may become due, and You agree to reimburse Us for all such Taxes by Our adding a charge to Your Lease Payment. In addition, You agree to pay Us, and We shall have the right to bill You periodically (as determined by Us) for. (a) estimated Taxes, together with the fees described herein, and (b) any remaining estimated amount due upon assessment of such Taxes. The estimated monthly Tax payment shall be based upon the full amount of the astlrnaled Taxoa. without regard to any dlocounts We may oblafn. If We pay any Taxes on Your behalf In excess of the estimated Taxes previously collected, You shall reimburse Us for all such payments upon Our demand, You hereby appoint Us as Your allomeyAn-fad to sign Your name to any document for the purpose of filing returns associated with any Taxes, so long as the filing does not Interfere with Your right to use the Equipment. None of the activities We undertake with respect to Taxes shall constitute the provision of tax advice. In connection with each Schedule, You agree to pay a documentation/processing fee In the amount set forth in the Schedule. ANY SwH6d k5 8Cf��l:;�,a�'SI��F RTH IN THIS SECTION 12 A'N0 ! NY O7tiER SECTION OF THI& LEASE MAY NCLUDEAPROFIT COMPONENT. 13. LIABILrtY: We are not responsible for any claims, demand*, actions, damages (whether dhoti, Indirect Incidental of consequential), liabilities, losses, Injuries or costs Incurred as a result of or relating, directly or Indirectly, to the Equipment and/or Its delivery, Installation, possession, use, return, lose of use, defect or malfunction. You shall save, Indemnify and hold Us harmless for, from and against any and all claims, demands, actions, damages, losses, liabilities, costs and expenses (Including, without limitation, reasonable attorneys' fees) made against or Incurred by Us that, directly or Indirectly, arise from or relate to the Equipment, Its delivery, Installation, possession, use, return, loss of use, defect and/or malfunction. 14. DEFAULT. You will be In default If: (a) You fail to make any Lease Payment when and as due, You otherwise fall to fully perform In accordance with this Master Agreement, any Lease or any other agreement between You and Us" or any of Your representations or warranties (or that of any guarantor) #1997282 v2 (03127/13) are untrue, (b) any guarantor falls to perform in acconfanca with any agreement batnoon the gustanlor and Us, (c) You (or any guarantor) bocomo Insolvent, mike an assignment for the behoM of eradllore or file a petition In bankruptcy, (d) a petition In bankruptcy Is filed against You or any guarantor, (a) You, any partner or guarantor ores, ceases to conduct business as a going concern, Is sold to, merged with or otherwise acquired by another entity, or suffers a substantial deferloration In financial condition. If You default, We may, In Our sore discretion" exercise any one or more of the folowrng remedies: (1) cancel any and/or all Lease(s) as to any or all of the Equipment, (If) require You to assemble and return any or all of the Equipment pursuant to Section 15 of this Master Agreement, (III) take possession of and/or render unusable by You any or all of the Equipment, wherever It may be located, and You hereby authorize Us and any designee of Ours to enter Your premises where any or all of the Equipment Is located with or without notice, court order or other process of law and without liability for any damages occasioned by such taking of possession, (Iv) require You to pay to Us, as damages and not as e penalty, but herein liquidated for all purposes, an amount equal to the sum of: (1) all Lease Payments then due or delinquent, (2) all Lease Payments for the then -remaining Term(s) of each Lease, (3) Our residual Interest In the Equipment as indicated by Our records, and (4) all Taxes, fees, charges and other amounts which are then, or which may (hereafter, become due Us under each Lease (You and We agree that the foregoing formula Is reasonable In light of the harm now anticipated to be caused by Your default), end/or (v) exercise any additional end/or other right or remedy available to Us at law (Including, without limitation, under the UCC) and/or In equity. You also agree to reimburse Us on demand for all costs and expenses Incurred by Us as a result of or otherwise relating to Your default (Including" without limitation, reasonable attorneys' fees" accountants' fees" expert witness fees, filing fees, travel costs, and repossession and other recovery costs). You agree that any delay or failure to enforce Our rights under this Master Agreement or any Lease does not prevent Us from enforcing any rights at a later time. 13. RETURN OF EQUIPMENT. With respect to each Lease: (a) If You elect or are required to return the Equipment under Sections 8 or 14 of this Master Agreement or any Lease, You shell, at Your expense, send the Equipment to any location(s) within 50 Miles of the Equipment Location Address Indicated on the applicable Lease, (b) If You elect or are required to return the Equipment under Section e, You shell do so Immediately upon the expiration of the then -current Term, (c) If You are required to return the Equipment under Section 14, You shall do so Immediately upon notice from US, (d) the Equipment must be returned having been maintained In accordance with Section 9 of this Master Agreement, and (a) You will continue to make all Lease Payments and pay all other amounts due under the applicable Lease unlit the Equipment is received and accepted by Us or Our designee. 16. FINANCE LEASE. You agree that each Leese Is a Finance Lease under Article 2A of the UCC. To the extent permitted by applicable law, You hereby waive any and all rights and remedies conferred upon You under UCC Sections 2A-303 and 2A-508 through 522. If it is determined that any Lease constitutes a secured transaction, You hereby grant to Us a security Interest In the Equipment related to such Lease and all proceeds thereof. You authorize Us to record a UCC-1 flnencing statement or elmilar Instrument In order to protect Our Interest In the Equipment. 17. COMPLIANCE WITH LAWS; APPLICABLE LAW. You understand that the Equipment may be purchased for cash or it may be leased. By signing each Lease, You acknowledge that You have chosen to lease the Equipment from Us for the Term of the Lease, and that You have agreed to pay the specified Leese Payment Amount and all other fees and amounts described herein and In the Lease. You shall comply with applicable laws In the performance of the Leese. If It Is determined that any amount due under any Leese results a payment greeter than would be allowed by applicable law, then any excess amounts collected by Us will be applied to any outstanding balance due and owing under such Lease, adjusted to conform with such applicable law" or, If there Is no such outstanding balance, will be refunded to You upon request. This Master Agreement and each Lease shall be governed by, construed and enforced In accordance with the laws of the State of Iowa without regard to Its choice of law considerations. The parties agree that this Master Agreement and each Leese shall be treated as though executed and performed In Polk County, Iowa, and that all legal actions relating to this Lease shall be venued exclusively In a state or federal court located In Polk County, Iowa. You hereby agree to not object to venue as set forth above and consent to the personal jurisdiction of such courts. YOU AND WE HEREBY WAIVE YOUR AND OUR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY LEGAL ACTION BETWEEN YOU AND US. Each provision of this Master Agreement and each Leese shall be Interpreted In such a manner as to be effective, valid and enforceable under applicable law. If any provision of this Master Agreement or any Lease Is construed to be prohibited or unenforceable, such provision shall be Ineffective only to the extent of such prohibition or unenforceability and without Invalidating or olherwlse effecting the remainder of such provision, the remaining provisions of this Master Agreement or any Lease, or the validity or enforceability of ouch provision in any other jurisdiction. 1e. UNCONDITIONAL OBLIGATION. YOU ACKNOWLEDGE AND AGREE THAT: (A) YOU, NOT US, SELECTED THE EQUIPMENT AND THE SUPPLIER AND DIRECTED THAT WE ACQUIRE THE EQUIPMENT FROM THE ABOVE -REFERENCED SUPPLIER, (B) WE ARE NOT THE SELLER, SUPPLIER, MANUFACTURER OR DEALER OF THE EQUIPMENT (EACH, A "VENDOR"), (C) WE ARE A SEPARATE AND INDEPENDENT COMPANY FROM EACH OF THE VENDORS, (D) NO VENDOR IS OUR AGENT, (E) NO STATEMENT, PROMISE, REPRESENTATION, GUARANTY OR WARRANTY BY ANY VENDOR OR OTHER THIRD PERSON OR ENTITY IS BINDING ON US, (F) NO BREACH BY ANY VENDOR OR OTHER THIRD PERSON OR ENTITY WILL EXCUSE YOU FROM FULLY PERFORMING YOUR OBLIGATIONS TO US, (G) YOUR DUTY TO MAKE ALL LEASE PAYMENTS (AND OTHERWISE FULLY PERFORM IN ACCORDANCE WiTH EACH LEASE) IS UNCONDITIONAL DESPITE ANY EQUIPMENT FAILURE, DAMAGE OR LOSS, THE EXISTENCE OF ANY LAW RESTRICTING OR PROHIBITING THE POSSESSION AND/OR ANY USE OF THE EQUPME4T, OR ANY OTHER MATTER OR CONDITION WHATSOEVER, (H) IF THE EQUIPMENT DOES NOT WORK AS REPRESENTED BY ANY VENDOR OR OTHER THIRD PERSON OR ENTITY, OR IF ANY VENDOR OR OTHER THIRD PERSON OR ENTITY FAILS TO PROVIDE ANY SERVICE OR MAINTENANCE OR FULFILL ANY OTHER OBLIGATION TO YOU, OR IF THE EQUIPMENT IS UNSATISFACTORY FOR ANY OTHER REASON WHATSOEVER, YOU SHALL MAKE ANY CLAIM ASSOCIATED THEREWITH AGAINST THE APPLICABLE VENDOR OR OTHER THIRD PERSON OR ENTRY ONLY, SHALL NOT HAVE OR MAKE ANY CLAIM AGAINST US, AND SHALL CONTINUE TO MAKE ALL LEASE PAYMENTS AND OTHERWISE FULLY PERFORM UNDER THIS LEASE. YOU HEREBY WAIVE ANY RIGHTS WHICH WOULD ALLOW YOU TO: (1) CANCEL OR REPUDIATE ANY LEASE, (II) REJECT OR REVOKE ACCEPTANCE OF THE EQUIPMENT; (III) GRANT A SECURITY INTEREST IN THE EQUIPMENT (OTHER THAN TO US), (IV) ACCEPT PARTIAL DELIVERY OF THE EQUIPMENT, (V) "COVER" BY MAKING ANY PURCHASE OR LEASE OF SUBSTITUTE EQUIPMENT, (VI) SEEK SPECIFIC PERFORMANCE AGAINST US, AND/OR (VII) WITHHOLD ANY PAYMENT OR OTHER AMOUNT FROM US. 19. THIRD PARTY MAINTENANCE AGREEMENT. If You have entered Into a written or oral maintenance, service or similar agreement (a "Maintenance Agreement") with any Vendor or any other party relative to the Equipment (the "Maintenance Provider'), You acknowledge and agree that: (a) We are not a party to the Maintenance Agreement, (b) If the cost to You of such malnlonanca and services is Included In each Leesa Payment Amount andlor any of Ourinvofces to You, We are collecting such costs as an administrative convenience to You and the Maintenance Provider, and (c) You will look only to the Maintenance Provider for the provision of any maintenance, repairs and other services and supplies required or permitted under the Maintenance Agreement, and We have no melnlenance, repair, service, supply or other obligations or liabilities whatsoever under the Maintenance Agreement or otherwise. 20. POWER GOLF CARS. If the Equipment includes any power golf cars ("Carts"), notwithstanding anything to the contrary set forth herein, You may temporarily sub -rant such Carts on a daily or par -found basis to your patron(%) on Your promises only, but You shall remain solely liable for all of Your duties and obligations hereunder and You shall collect from such patron(s) and remit to the proper taxing jurisdiction all sales and use taxes that may be due under applicable law In relation to any such Cart rental(s). f rY Losses: Initial Here Co -Lessee: AMENDMENT TO MASTER LEASE AGREEMENT THIS AMENDMENT TO MASTER LEASE AGREEMENT is by and between LANDMARK GOLF MANAGEMENT, LLC., as Customer, and WELLS FARGO FINANCIAL LEASING, INC as Owner. BACKGROUND A. By that certain MASTER LEASE AGREEMENT, # dated . 20_, by and between Owner and Customer. Owner has agreed to extend financing to Customer upon and subject to the terms and conditions set forth in the MASTER LEASE AGREEMENT ("Agreement") B. Owner and Customer desire to amend the terms and conditions of the Agreement, upon and subject to the terms and conditions of this Amendment. C. All capitalized terms not otherwise defined herein will have the meanings set forth in the Agreement. NOW, THEREFORE, in consideration of good and valuable consideration, the parties intending to be legally bound agree as follows: 1. 6. AUTOMATIC RENEWAL; PURCHASE OPTION. With respect to each Lease: The first paragraph of Subsection (6)(A) "Original Term Provisions," shall read as follows: a. "A. Original Term PraV[§ions. The following terms apply during the Original Term of the Lease." 2. 6. AUTOMATIC RENEWAL; PURCHASE OPTION. With respect to each Lease: Subsection (6)(C): "$1.00 Purchase Option Provisions" shall be stricken in its entirety. IN WITNESS WHEREOF, the duly authorized representatives of the parties have executed this Amendment on the dates set forth below but effective as of the effective date of the Agreement, as set forth above. LANDMARK GOLF MANAGEMENT, LLC. By: q Name: '1 a e4 Title: �wit�di'f T 11�77 Date of Execution: WELLS FARGO FINANCIAL LEASING, INC By: Name: Title: Date of Execution: Master Lease Schedule Master Lease Agreement # / Dated General Information Lossas's flame: Co -Lessees Name: Master Lease Agreement No: Landmark Golf Management, LLC dba SllverRock Resort essss's Address: Co -Lessee's Address: Application s: 79-179 Ahmanson Lane' LBQUInta CA 92253 769398 all:linq Address (If dlfrorant than Leases Addressshown ab-ove) 79-179 Ahmanson Lane; LaQUinta, CA 92253 Supplier (Dealoes)Name3 ddresst - - Dealer# Club Car 205207.0019 Lessor. Wells Fargo Financial Leasing, Inc. Equipment Information Wells Fargo hereby agrees to lease to Lessee, and Lessee hereby agrees to lease from welts Fargo, the Equipment Idonililed on Addendum A, attached hereto and locos oraled hemin by rate rence. Equipment Location (Address, City, State, County, 21p Code): ❑ Check Here if Equipment Insurance 79-179 Ahmanson Lane; LaQuinta, CA 92253 Location is outside of City Limits ❑ Proof of Insurance Attached Lease / Payment Information original Term: Camn%ntemant Date; ONinal Term Purchase Option Lease Payment: Property Tax: Use Tax: Total Lease Payment Price: 37 Months 11/1/2013 N/A $10 363.45 $135.20 $10,498,65 Renewal Information Ronewel Tent; Renewal Dote: Renowat Term Purchase Opt on Renewal Lease Pmporty Tex; Use ter: Tate1 Rene nal Price: Payment: Lasso Payment Date Payment Begins: 12/1/2013 Payments are due on da s): _Monthly Payments Initial lease payment due December 1, 2013 for $10 623.65, which includes documentation fee of $125.00. Consecutive month) lease payments of [I Payments other than monthly (if checked, -- payments are: ElQuarterly; or ❑ Payment $10,498.65 thereafter. Schedule Attached) Property tax to be billed directly to lessee. Advance Lease Payment: $ includes the first . payment(s) and the last a ment s . In connection with this Schedule, Lessee agrees to pay a documentation/processing fee of $125.00. Total Finance Cha es due during the Original Term of this Schedule: $ This Equipment Lease Schedule (this "Schedule") is made and entered Into as of the Effective Date identified above and is entered into in connection with the above -Identified Master Lease Agreement (the "Master Agreement"). All of the terms and conditions set forth In the Master Agreement are hereby reaffirmed and Incorporated In and made part of this Schedule, as if fully set forth herein. This Schedule, Inclusive of the terms and conditions set forth in the Master Agreement as aforesaid, constitutes a separate lease between Wells Fargo and Lessee that may be referred herein to as this "Lease". This Lease is not binding upon Wells Fargo until Wells Fargo accepts this Lease by signing below. A facsimile copy of this Lease shall have the same force and effect as the original. This Lease may not be modified except in writing, signed by Wells Fargo and Lessee. This Lease may be terminated early only In accordance with Section 5 of the Master Agreement. Lessee: Landmark Golf Management, LLC Co -Lessee: dba SilverRockk Resort By: t 4o� By: Name/Title: AndyVo ler, President Name/Title: Date: '^ `� f . Date: Lessor: Wells Fargo Financial Leasing, Inc. By: Date: Name/Title: 71o29-ve Addendum A to Master Lease Schedule Master Lease Agreement # / Dated This Addendum A Is entered Into in connection with Master Lease Schedule No. (the "Schedule"). Wells Fargo hereby agrees to lease to Lessee, and Lessee hereby agrees to lease from Wells Fargo, the following -described Equipment upon the terms and conditions set forth In the Schedule: Description of Equipment: (85) New Club Car Precedent i2 Excel Electric Golf Cars w/ Hinged Windshield, Ball Washer, Cooler, Sand Bottle, Canopy, Deluxe Information Holder (8) New Club Car Precedent 12 Excel Electric Golf Car w/ Canopy, tow Bracket(Shuttle) (3) New Club Car Precedent i2 Excel Electric Cars, Hinged Windshield, Sand Bottle, Canopy (Ranger) (2) New Club Car CafB Express Gas w/ Front Bumper, Upper Cabinet, Canopy, Windshield Frame, Green in color (3) New Club Car Transporter 6 w/ Windshield, Canopy, Bag Rack Serial Number Maximum # Excess Use Beginning of Hours Charge Per Hr. Meter Per Year: Hour: # Lessee agrees that Wells Fargo may insert the Serial Numbers for the Equipment after Lessee's execution hereof. A facsimile copy of this Addendum shall have the same force and effect as the original. This Addendum may not be modified except in writing, signed by Wells Fargo and Lessee. Lessee: Landmark Golf Management, LLC Co -Lessee: dba SilverRock Resort By: L 1L�++ u rL By: Name/Title: Andy Vossler, President Name/Tltle: Date: , / 01* 1— Lessor: By: Name/Title: Date: WELLS FARGO FINANCIAL LEASING, INC. Date: Delivery To: Wells Fargo Financial Leasing, Inc., MAC F4031-050, 800 Walnut Street, Des Moines, IA 50309 ("Wells Fargo") Re: Master Lease Schedule No: the "Lease" Lessee (and Co -Lessee, If applicable) hereby unconditionally cerlifles that: (1) all of the Equipment (d) has been properly delivered to It at the Equipment location described In the Lease, (b) has been Installed and is in good working order, and (c) meets all of its requirements and is suitable for Its purposes, (2) It has had a reasonable opportunity to inspect the Equipment and unconditionally and irrevocably accepts all of the Equipment for all Ipurposes, (3) it has duly executed the Lease and no side agreements or cancellation rights have been granted to it with respect to the Lease or any (Equipment, (4) all of its representations and warranties set forth In the Lease are true and correct, and (5) it has not been induced to sign this Certificate by any assurances of Wells Fargo or anyone else. Lessee (and Co -Lessee, if applicable) authorizes Wells Fargo to, at any time, Insert the number of the Lease in this Certificate. Date By Print Name and Title of Signor x 71o25-v4 Page 1 of 1 INCUMBENCY CERTIFICATE I, the undersigned, do hereby certify that: (1) 1 am a duly elected and qualified Officer and/or Director of Landmark Golf Management, LLC dba SilverRock Resort ; (Full Legal Name of Company/Entity) (2) unless and until the above -named entity provides you written notice to the contrary, each of the Officers set forth below is and was empowered to enter into any agreement on behalf of the above -named entity and to execute and deliver any instrument, including, without limitation, leases and corporate guarantees, in the name of and on behalf of said entity, which in the opinion of such Officers, are in the best interests of said entity; and (3) the following are the true names and specimen signatures of the duly elected and incumbent Officers of said entity authorized to so execute, acknowledge and deliver all agreements, documents and commitments: Name of Authorized Signers) Andy Vossler Title President Signature In witness whereof, I have hereunto set my hand and, to the extent the above -referenced entity is a corporation, affixed the seal of the Corporation this __y�day of 20 15. ' r f gnature (of p on other than authorized signer) 7rr,'A Al 1 L_)., i Ai� h�F 0,, Managing Member Title 52374.0 Customer Wentificaltion Program Organized Entity Notice: To help the government fight the funding of terrorism and money laundering activities, U.S. federal law requires financial Institutions to obtain, verify and record information that identifies each person (individuals or businesses) who opens an account. What this means for you: When you open an account or add any additional service, we will ask you for your name, address, federal employer identification number and other Information that will allow us to Identify you. We may also ask to see other Identifying documents. CUSTOMER NAME: -ie ri'Lr/6/L �r� Y CUSTOMER 'Q= LEEXA.Li411i'. y Taxpayer ID Number: 100 — 6 / 3 80 7-C-- y Business Structure. Corporation , Partnership . , Limited Liability Company V ,Other, description: We may request certified copies of your organizational documents as part of the identification procedure. EMARY ADDRESS ANn„ R9§MTRA_ TMN Address: 77- r7-1 l _ al.Sv el y City: Ge,al), r �� y stare: r y Zip .Code: y' Country: fl y State of Registration/Incorporation: 3►' Subject to sales and use tax. (Tax will be charged based on the type of equipment financed and on the state in which the equipment is located.); or 0 Exempt from sales and use tax, for the following reason: (YOU MUSTREMIT A VALID EXEMPTION CERTIFICATE PRIOR TO FUNDING). Acknowledgment: The Information contained herein Is true and correct. Customer Name By: Its: atEDiTSfl:E,E1T Si lverRock Resort Landmark Golf Management, LLC 79179 Ahmanson Lane La Quinta, CA 92253 760-771-5151 760-777-8884 Owner: City of La Quinta (Sales Tax and ID # SR EHC 97-829622) Golf Course Operations Managed by: Landmark Golf Management, LLC. (Federal ID # 20-0936865) (Sales & Tax ID # SR EHC—100-6138075) 74947 Highway 111, Suite 200 Indian Wells, CA 92210 (760) 776-6688 (760) 776-6686 Fax Bank In ormation: Wells Fargo 74105 El Paso Palm Desert, CA 92260 Account # 5111538632 Contact: Lonny Whittington (760) 568-3460 References: High Tech Irrigation 74773 Joni Drive Palm Desert, Ca 92201 800-200-4116 Kenny Strickland P.O. Box 998 Coachella, CA 92236 760-398-2031 Target Specialty Products P. O. Box 3408 Santa Fe Springs, CA 90670 562-802-2238 Mowers Plus 79141 Country Club Drive Bermuda Dunes, CA 92203 760-772-2153 X Douglas VonBank Controller Customer Insurance Certification Lessee: Landmark Golf Management, LLC Application Number: 769398 dba SilverRock Resort Co -Lessee: Master Lease No.: Schedule No.: Name of Insurance Agency: Phone Number of Agency: le,4A) i %e- _57ftrE' 1NS (",9`IJ/'9�(- 0 Melling Address of Agency: Fax Number of Agency: a2 $S" N ©h,J rV IV A) 00� �9S/) .3 o 2 - d We agree and understand that, under the terms of our Master Lease Agreement with you, we must at all times keep the Equipment under the Schedule referenced above Insured against all risks, loss, damage or destruction for the full replacement coat with Wells Fargo Financlal Leasing, Inc. named as sole loss payee. Additionally, we must maintain, throughout the term of the Schedule, public liability insurance In he amounts specified In the Master Lease and name Wells Fargo Financial Leasing, Inc. as an additional insured. We must receive thirty (30) days prior notice before any termination, modification or cancellation for all types: of Insurance. I authorize you to contact the agencies identified above and authorize the agents to release insurance certificates to Wells Fargo indicating the above. LessetuleDate Co -Lessee Signature Date 3end:to W0IIs Fargo Financial Leasing, Inc. via mail to: Wells Fargo Financial Leasing, Inc., Golf and Turf Division, MAC# F4031.050, 800 Walnut Street, Des Moines, IA 50309; or via Fax to: Wells Fargo Financial Leasing, Inc., attn: Golf and Turf Division Fax #866-336-8375. EQUIPMENT DESCRIPTION. See Addendum A to Master Lease Schedule for the equipment description. Office Use Only Contact Date: Contact Name: Insurance Company(s): Policy No(s): Expiration Date(s): Insured Value: Named Sole Loss Payee: Wells Fargo Financial Leasing, Inc. El YES WILL BE ADDED Verified By: Additional Insured: Wells Fargo Financial Leasing, Inc. YES WILL BE ADDED Public Liability Insurance Limits: 60002-0 cw CERTIFICATE OF LIABILITY INSURANCE WE (MMIbDItY'rn 04/04/2013 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER, THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder Is an ADDITIONAL INSURED, the policy(les) must be endorsed. If SUBROGATION IS WAIVED, subject to the terns and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder In lieu of such endorsoment(s). PRODUCER Phone: (951) 094-5200 Fax: (951) 302-0470 cD"T;^CT Ashlee Salute TEMECULA INSURANCE SERVICES 28544 OLD TOWN FRONT STREET PrIoN FAx (961) 302-0470 (951 694-5200 rruC.No1 .E MWL SUITE #30B TEMECULA CA 92590 INSURERS¢ AFFORDING COVERAGE NAIC # INSURERA Granite State Insurance Company INS LANDMARK GOLF MANAGEMENT INSURER B Star Insurance Company INSURER C 79-179 AHMANSON LANE INSURER D: LA QUINTA CA 92253 INSURER E INSURERF COVRRAGF8 CERTIFICATE NUMBER: 3686 REVISION NUMBtK: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALLTHE TERMS, E XCLUSIONS ANDCONDITIONS OF SUCH POLICIES. LI 9 H WN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INOR TYPE OF INSURANCE ADO'L SUBR WVDPOLICY NUMBER POLICY EFP POLICY EXP 9narvyyIn LIMITS A GENERAL LIABILITY 02-LX-066142514-1 11/05/12 11/05/13 EACH OCCURRENCE $ 1,000,000 X COMMERCIAL GENERAL LIABILITY N PREMIs£S;Eaaceurence $ 300,000 MED. EXP (Any one person) $ 15,000 CLAIMS -MADE FXIOCCUR PERSONAL 6 ADV INJURY $ 11000,000 GENERALAGGREGATE $ 3,000,000 GEN'L AGGREGATE LIMIT APPLIES PER: PRODUCTS - COMP/OP AGO $ 3,000,000 FRO LOC POLICY Ej A AUTOMOBILE LIABB.rrY 02-LX-066142514-1 11/05/12 11/05/13 BINED$ �e,M NOEEUMIT $ 1,000,000 BODILY INJURY (Per person) $ ANY AUTO ALL OWNED SCHEDULED AUTOSBODILY HIRED AUTOSNAUTOS AUTOS Ix INJURY (Per eccldenl) S A (per Snider $ E UMBRELLA LIAs OCCUR EACH OCCURRENCE $ AGGREGATE $ EXO rM LIAR CLAIMS -MADE CED RETENTION $ $ B WORRaRB GOMPENBATION AND EMPLOYOW LIABILITY ANY PROFRIETORIPARTNERIEXECUTIVE YIN OFFICERIMEMBER EXCLUDED? F-1 wy Is iMeadetery NH) �J fff gyn, n under O£aCRIPTION OF OPERATIONS balmE. NIA WCMSTR 0522214 12/23/12 12/23/13 TO,7,,A T5 ER $ E.L. EACH ACCIDENT $ 1,000,000 E.L. DISEASE -EA EMPLOYEE $ 1,000,000 - L. DISEASE -POLICY LIMIT $ 1,000,000 A Business Personal Property 02-LX-066142514-1 11/05/12 11/05/13 $514,550 DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES (Attach ACORD 101, Additional Remarks Schedule, If more space Is required) Certificate Holder Is named as Additional Insured CERTIFICATE HOLDER CANCELLATION City of La Qulnta SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE 78495 Calls Tampico THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN La Quints, CA 92263 ACCORDANCE WITH THE POLICY PROVISIONS. AUTHORIZED REPRESENTATIVE gx,.,, qnN e,.i Hiryl. urn. Attention: Bradley J. Salute 4 n�xaww Amon �R r�n,nrnR� 0 1988-2010 ACORD CORPORATION, All rights reserved. The ACORD name and logo are registered marks of ACORD C/A �I '1.a5 will 00 a� g4' WW 1 k1.0� IMPORTANT: INCLUDE A VOIDED CHECK FOR VERIFICATION OF/'YOUR CHECKING ACCOUNT NUMBER. PLEASE FAX TO 866-336-8375/6R MAIL T0: Wells Fargo inancial Leasing, Inc. Golf and Turf vision 800 Walnut Stre t MAC F4031-050 Des Moines, IA 5030 With the Automatic Pay m t Plan, all your pay tints to us will be deducted from your checking account an paid to Wells Fa go Financial Leasing, Inc. on the payment due date as shown o your regular i . oice. Your regular invoice will show the amount to be deducted and he due date Enrollment is Easy. Simply... 1. Complete the Authorization Form. 2. Return the Authorization Form with ur voided check to Wells Fargo Financial Leasing, Inc. (Customer Name) Landmark Golf ("Customer") hereby authorizes debit entries to its checking hereinafter called "DEPOSITORY account for amounts due Weld.' between Well Resort. dba SilverRock Resort We A's Fargo Finance 1 Leasing, Inc. ("Wells Fargo") to initiate a aunt indicated b low at the depository named below, and authorizes the BfPOSITORY to debit the same to such } Fargo pursuant to th terms of the Agreement(s) dated Fargo and Landmark Golf . anagement, LLC dba SilverRock Depoa€tory Name Bra ch City State Zip '1� Routing Number Account Number This authorizatio is to remain in full force and effect until Wells Fargo has received written notification fro Customer of its termination in such time and in such manner as to afford Wells Fargo and DEPQ ITORY a reasonable opportunity to act on it. Customer agrees that a facsimile copy of this ag. eement bearing signatures may be treated as an original. GATE: ` CUSTOMER NAME: CUSTOMER ACCOUNT NUMBER. - BY (AUTHORIZED SIGNATURE FOR BANK ACCOUNT) szaeeeA Landmark Golf Management, LLC dba SilverRock Resort Document Check List Application 769398 ❑ Sign '& date the Master Lease Agreement o Initial page two of the Master Lease Agreement ❑ Sign'& date the Master Lease Schedule ❑ Sign & date the Master Lease Schedule — Equipment Addendum A o Sign the Delivery and Acceptance Section ti . Sign .the Incumbency Certificate - Two Signatures Required o Andy Vossler signs the middle portion o A Managing Member signs the lower portion City of LaQuinta, CA to sign the Guaranty U City of LaQuinta, CA to sign & date the Non -Appropriations Addendum P tit City Attorney to complete Attorney Opinion Letter and print ontheir letterhead ❑ Return a CA State Exemption Certificate for Resale o Required to exempt the lease payment of golf cars from sales tax o Complete all information on CIP Form ❑ Complete, sign & date the Insurance Form ❑ Complete, sign & date the Automatic Payment Form (OPTIONAL) o Include a voided check ❑ Sendall of the completed & signed documents to: Wells Fargo Financial Leasing, Inc. Attn: Shawn !Foy MAC # NOO65-044 800 Walnut Street Des Moines,1A 50309 369721 v1 r1� ! � 1 MEMORANDUM TO: Frank Spevac;ek, City Manager VIA: Edie Hylton, Community Services Director FROM: Steve Howl en, Golf & Parks Manager DATE: October 1, 2013 RE: Golf Cart Lease Agreement/Guaranty of Lease The Golf Cart Lease Agreement by and between Landmark Golf Management and Wells Fargo for replacement golf carts at SilverRock Resort is attached for your review and approval. The current Club Car golf cart lease is $1 1,165 per month and: will expire November' 1, 2013. This new thirty-six month Lease will begin payments on December, 20113 and provide Club Car golf carts at a cost of $10,499 per month. The! cost for the new golf cart lease is lower and within the SilverRock budget as per the City Council approved 2013/14 Annual Plan. Section 3.6 of the July '1, 2013 Golf Course Management Agreement by and between the City and Landmark Golf Management requires that all leases and agreements related to the; operations at SilverRock Golf Course be approved as to form, content, and vendor by the City. This Master Lease Agreement requires the City to; 1. Sign the "Corporates Guaranty Of Master Equipment Lease." This states the City will be responsible for any payments and attorney fees for actions taken against Landmark should they not fulfill the Agreement. Furthermore, the City will waive any claim procedures against Wells Fargo. This language is typical for a Guaranty. 2. Sign and date the "Non -Appropriations Addendum." This enables the lessee to terminate the lease agreement at the end of the current appropriation period without further obligation or penalty. This can be done only in cases where the lessee is unable. to obtain funding for future payment obligations on the lease. 3. Have the City Attorney complete an "Attorney Option Letter" printed on their letterhead. Erica eSO Shipment -- Label Page IofI From: (700)177-8084 Origin ID: PSPA' RANOYDUNCAN SILVERROCK RESORT 79119 AHMANSON LN LA QUINTA, CA 92253 SHIP tO: (866) 336-8382 ERICA WARD WELLS FARGO GOLF/TURF 800 WALNUT ST N0005`044 FL 04 DES MOINES, IA 50309 BILL SENDER Ship Date: 11SEP13 AcNWgt 0,5 LB CAD: 104057601AVS)02600 0.liveryAddress Bar Cod 1'ICI'IiYI�III11AUI�1011111RI��IIAI RMA Ik Return Reason: nR z, 7958 31201436 RETURNS MON-FRI STANDARD OVERNIGHT 50309 IA•US https://fabst-win.wellsfargo.com/eso/track—label.aspx 9/11/2013 Wanda Wise -Latta From: Cindy Henson <cndy@hensonconsultinggroup.com> Sent: Thursday, October 17, 2013 11:50 AM To: Frank Spevacek Cc: Wanda Wise -Latta Subject: Re: Timeline Graphic I think just dates / every 5 year chunks (or 10 years). I don't know how large we can make it as I have not yet seen the room. Maybe that person and/or Wanda should go to the room to check it out and measure the possible time line space. Ideally we would have at least 12-15 feet for the past. I think a small space before incorporation but the major footage would be from incorporation year until now. Does that make sense? Maybe the artistic / good writing person is working tomorrow? Will be at city hall at 1:30p Thx c Sent from my iPhone On Oct 17, 2013, at 11:39 AM, "Frank Spevacek" <Fspevacek@la-quinta.org> wrote: Wanda, who amongst City staff can draw/write neatly that we can ask to prepare the timeline for Saturday? Cindy, we need to identify what we want on this timeline. From: Cindy Henson [mailto:cndy,@-hensonconsultinggroup com] Sent: Thursday, October 17, 2013 8:41 AM To: Frank Spevacek Subject: Re: Timeline Graphic Great idea. Let's invite the creative types to prepare that. I don't want their master piece to over shadow, though. So, need to explain the context of the exercise. Just want to leave space for Saturday participants to write and add pictures, etc. Go for it! Sent from my iPhone On Oct 17, 2013, at 8:25 AM, "Frank Spevacek" <Fspevacek@la-qunta�> wrote: Good Morning: Do we need to prepare the base graphic that will be used for the timeline? I am thinking any dates or titles? If so, we may want to tap the talent that is at City Hall today since some of our more creative types will be off tomorrow. Frank J. Spevacek City Manager City of La Quinta Office: 760-777-7030 Fax: 760-777-7101 MEMORANDUM TO: Frank J. Spevacek, City Manager FROM: Steve Howlett, Facilities Director DATE: July 20, 2016 RE: Amendment to SilverRock Lease Agreement The Amendment to the Master Lease Agreement by and between Landmark Golf Management and Wells Fargo for replacement maintenance equipment at SilverRock Resort is attached for your review and approval. The Master Lease Agreement for golf course maintenance equipment was entered into on November 20, 2013. This amendment replaces 25 maintenance units in the existing Master Lease for and additional $3,609.70/mo. for 60 months. The City Council approved 2016/2017 SilverRock Annual Plan includes sufficient funding in the amount of $116,200 for this leased equipment and the additional cost. Section 3.6 of the July 1, 2013 Golf Course Management Agreement by and between the City and Landmark Golf Management requires that all leases and agreements related to the operations at SilverRock Golf Course be approved as to form, content, and vendor by the City. Please sign the attached letter to Landmark Golf Management that approves the Amendment to the Master Lease Agreement as to form, content, and vendor by the City. Requesting department shall check and attach the items below as -appropriate: _X_ Contract payments will be charged to account number: 601-0000-60203 _X_ Amount of Agreement, Amendment, Change Order, etc.: $3,609.70/mo. for 60 mo. A Conflict of Interest Form 700 Statement of Economic Interests from Consultant(s) is attached with no reportable interests in LQ or reportable interests A Conflict of Interest Form 700 Statement of Economic Interests is not required because this Consultant does not meet the definition in FPPC regulation 18701(2). Authority to execute this agreement is based upon: Approved by the City Council on May 17, 2016 City Manager's signature authority provided under Resolution No. 2015-045 for budgeted expenditures of $50,000 or less Initial to certify that 3 written informal bids or proposals were received and considered in selection 1� 9 July 19, 2016 Mr. Andy Vossler Landmark Golf Management, LLC 74947 Highway 111, Suite 200 Indian Wells, CA 92210 Dear Mr. Vossler: The enclosed Addendum to Lease Agreement by and between Landmark Golf Management (the "Leasee") and Wells Fargo (the "Lessor"), is hereby approved as to form, content, and vendor. This approval is pursuant to and within the meaning of Section 3.6 of the Golf Course Management Agreement by and between the City of La Quinta and Landmark Golf Management, dated July 1, 2013. If you have any questions or require additional information, please contact Steve Howlett, Facilities Director at (760)777-7026. FS/sh cc: Steve Howlett, Facilities Director 78-495 Calle Tampico I La Quinta I California 92253 1 760.777.7000 1 wwwla-quinta•org Document Check List Wells Fargo Financial Leasing, Inc. I Boo Walnut, 4th floor I Des Moines, Iowa 50309 1 Phone: 866-336-8382 Customer Name: Landmark Golf Management, LLC Application Number: 945561 D Include a check for the Advance Lease Payment, in the amount of $3,734.70 which includes a Documentation/Processing Fee of $125.00 and applicable sales/use taxes. p Sign & date the Master Lease Schedule Q. Sign & date the Addendum A/Delivery and Acceptance q Attorney Opinion Letter is Required (Example is attached for your use) *Must be on Attorney Letterhead p Complete, sign & date the Insurance Form o Liability Coverage - ®Minimum coverage of $1 million ®Wells Fargo Financial Leasing to be listed as additional insured. o Propetty Covera e - ®Value of equipment covered ®Wells Fargo Financial Leasing to be listed as the Lenders loss payable endorsement. p Complete, sign & date the Automatic Payment Form (OPTIONAL) -A new ACH form must be completed for each new lease. p Send all of the completed & signed documents with the Advanced Lease Payment using the overnight label provided to: Wells Fargo Financial Leasing, Inc. Attn: Sheri Buttrey MAC # N0005-044 800 Walnut Street Des Moines, IA 50309 *White Out is not acceptable on any documents *Electronic Signatures are not acceptable *Please do not make any changes/additions/deletions to the lease documents unless approved as this voids the documents. Doc Checklist (10/21/13) Page 1 of 1 Master Lease Schedule Master Lease Agreement # 603-0019175 / Dated 11/20/2013 General• • Lessee's Name: Co -Lessee's Name: Master Lease Agreement No: Landmark Golf Management, LLC Lessee's Address: Co -Lessee's Address: Application #: 79-179 Ahmanson Lane, LaQuinta. CA 92253 _ _ 945561 Billing Address (if different than Lessee Address shown above) 79-179 Ahmanson Lane, LaQuinta, CA 92253 Supplier (Dealers) Name & Address: Dealer # Arizona Machinery Group Inc 205185.0019 Lessor: Wells Fargo Financial Leasing, Inc. Equipment Information Wells Fargo hereby agrees to lease to Lessee, and Lessee hereby agrees to lease from Wells Fargo, the Equipment identiFied on Addendum A. attached hereto and Incor rated herein by reference Equipment Location (Address, City, State, County, Zip Code): ❑ Check Here if Equipment Insurance: SilverRock Resort Location is outside of City 79-179 Ahmanson Lane, LaQuinta, CA 92253 Limits ❑ Proof of Insurance Attached Lease / Payment Information Original Term: Commencement Date: Original Term Purchase Option Lease Payment (plus applicable Price: Taxes): ❑ Lease Payment includes Sales Tax 60 Months 10/30/2016 N/A $3,609.70 Renewal• • Renewal Term: Renewal Date: Renewal Term Purchase Option Price: Renewal Lease Payment (plus applicable Taxes): Date Payment Begins: 10/30/2016 Payments are due on day(s): ® Monthly Payments ❑ Payments other than monthly (if checked, Payments of $3,609.70(plus tax) beginning 10/30/2016 payments are: ❑ Quarterly; or ❑ Payment Schedule Attached) Advance Lease Payment: $3,734.70 includes the first 1 a ment s and the last 0 a ment(s). In connection with this Schedule, Lessee agrees to pay a documentation/processing fee of $125.00. Total Finance Charges due during the Original Term of this Schedule: $ This Equipment Lease Schedule (this "Schedule") is made and entered into as of the Effective Date identified above and is entered into in connection with the above -identified Master Lease Agreement (the "Master Agreement"). All of the terms and conditions set forth in the Master Agreement are hereby reaffirmed and incorporated in and made part of this Schedule, as if fully set forth herein. This Schedule, inclusive of the terms and conditions set forth in the Master Agreement as aforesaid, constitutes a separate lease between Wells Fargo and Lessee that may be referred herein to as this "Lease". This Lease is not binding upon Wells Fargo until Wells Fargo accepts this Lease by signing below. A facsimile copy of this Lease shall have the same force and effect as the original. This Lease may not be modified except in writing, signed by Wells Fargo and Lessee. This Lease may be terminated early only in accordance with Section 5 of the Master Agreement. Lessee: Landmark Golf Management, LLC Co -Lessee: By: By: t Name/Title: Andy Vo ler, President Name/Title: Date: ?415._ b Date: Lessor: Wells Fargo Financial Leasing, Inc. By: Date: Name/Title: #2494202 v2 (10128/13) Addendum A to Master Lease Schedule Master Lease Agreement # 603-0019175 / Dated 11/20/2013 This Addendum A is entered into in connection with Master Lease Schedule No. 945561 (the "Schedule"). Wells Fargo hereby agrees to lease to Lessee, and Lessee hereby agrees to lease from Wells Fargo, the following -described Equipment upon the terms and conditions set forth in the Schedule: Description of Equipment: Serial Number Maximum # Excess Use Beginning of Hours Charge Per Hr. Meter Per Year: Hour: # (4) 2016 John Deere 2500E PrecisionCut Riding Greens Mower -Diesel <600 Hrs/Yr $15/Hr (7) 2016 TX Turf PR Utility Vehicle (2) 2016 John Deere MY16 1200A Bunker & Field Rake (2) 2016 John Deere Gator TE Electric Utility Vehicle (4) 2016 John Deere 22B Trailer (4) 2016 John Deere 220SL PrecisionCut Walking Greens Mower (2) 2016 Turfco Torrent Blower Lessee agrees that Wells Fargo may insert the Serial Numbers for the Equipment after Lessee's execution hereof. A facsimile copy of this Addendum shall have the same force and effect as the original. This Addendum may not be modified except in writing, signed by Wells Fargo and Lessee. Lessee: Landmark Golf Management, LLC Co -Lessee: By: By: Name/Title: President Name/Title: Date: i rA'jndyVossle)r, 1 •" { ! - Date: 16 Lessor: WELLS FARGO FINANCIAL LEASING, INC. By: Name/Title: Date: Delivery To: Wells Fargo Financial Leasing, Inc., MAC F4031-050, 800 Walnut Street, Des Moines, IA 50309 ("Wells Fargo") Re: Master Lease Schedule No: (the "Lease") Lessee (and Co -Lessee, if applicable) hereby unconditionally certifies that: (1) all of the Equipment (a) has been properly delivered to it at the Equipment location described in the Lease, (b) has been installed and is in good working order, and (c) meets all of its requirements and is suitable for its purposes, (2) it has had a reasonable opportunity to inspect the Equipment and unconditionally and irrevocably accepts all of the Equipment for all purposes, (3) it has duly executed the Lease and no side agreements or cancellation rights have been granted to it with respect to the Lease or any Equipment, (4) all of its representations and warranties set forth in the Lease are true and correct, and (5) it has not been induced to sign this Certificate by any assurances of Wells Fargo or anyone else. Lessee (and Co -Lessee, if applicable) authorizes Wells Fargo to, at any time, insert the number of the Lease in this Certificate. Date By Print Name and Title of Sionor 71025-v4 Page 1 of 1 June 23, 2016 Wells Fargo Financial Leasing, Inc. 800 Walnut Street, 4th Floor Des Moines, Iowa 50309 Ladies and Gentlemen: As counsel for Landmark Golf Management, LLC ("Customer"), I have examined that certain Master Lease Schedule, Application Number 945561, and, if applicable, that certain Non -Appropriation Addendum thereto, each duly executed by Customer and dated November 20, 2013 (collectively, the "Agreement"), between Customer and Wells Fargo Financial Leasing, Inc. ("Company"), and the proceedings taken by the governing body of Customer to authorize on behalf of Customer the execution and delivery of the Agreement. Based upon the foregoing examination and upon an examination of such other documents and matters of law as I have deemed necessary or appropriate, I am of the opinion that: 1. Customer has the requisite power and authority to execute and deliver the Agreement and to perform its obligations under the Agreement. 2. The Agreement has been duly authorized, executed and delivered by Customer and the Agreement constitutes a legal, valid and binding obligation of Customer, enforceable against Customer in accordance with its terms, subject to any applicable bankruptcy, insolvency, moratorium or other laws or equitable principles affecting the enforcement of creditors' rights generally. 3. The authorization, approval, execution and delivery of the Agreement and all other proceedings of Customer's governing body relating to the transactions contemplated by the Agreement have been performed in accordance with all open meeting laws, public bidding laws and all other applicable state laws and all actions, approvals, authorizations and consents necessary to authorize Customer's execution, delivery and performance of the Agreement have occurred or been obtained. 4. No litigation or proceeding is pending or, to the best of my knowledge, threatened to restrain or enjoin the execution, delivery or performance by Customer of the Agreement or in any way to contest the validity of the Agreement, to contest or question the creation or existence of Customer or its governing body or the authority or ability of Customer to execute or deliver the Agreement or to comply with or perform its obligations thereunder. There is no litigation pending or, to the best of my knowledge, threatened seeking to restrain or enjoin Customer from annually appropriating sufficient funds to make the payments contemplated by the Agreement. 5. The entering into and performance of the Agreement does not and will not violate any judgment, order, law or regulation applicable to Customer or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest or other encumbrance upon any assets of Customer or on the Equipment (as such term is defined in the Agreement) pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement or other instrument to which Customer is a party or by which it or its assets may be bound. 6. The execution and delivery of the Agreement and the appropriation of monies to pay the payments coming due thereunder do not result in the violation of any constitutional, statutory or other limitation relating to the manner, form or amount of indebtedness or liabilities which may be incurred by Customer. 7. The Agreement is the complete and exclusive agreement between Customer and Company regarding Customer's financing of the equipment described therein. No other agreements, terms or conditions (including, without limitation, any terms or conditions set out in any solicitation, request for proposal, invitation to bid or contract award) are incorporated, by reference or otherwise, into the Agreement. 8. The Customer's name contained in the Agreement is the Customer's full, true and correct legal name. This opinion may be relied upon by purchasers and assignees of Company's interests in the Agreement. Respectfully submitted, [INSERT NAME OF LAW FIRM] [INSERT NAME OF ATTORNEY] #2465505 v1 Municipal - Taxable (10/17/13) Customer Insurance Certification Lessee: Landmark Golf Management, LLC Application Number:945561 Liability Coverao ®Minimum coverage of $1 million ®Wells Fargo Financial Leasing to be listed as additional insured. Name of Insurance Agency: I Phone Number of Agency: Mailing Address of Agency: Email Address of Agency: Property Coverage (Complete if a different provider from above) Fax Number of Agency: ®Value of equipment covered ❑ All Risk Physical Damage Insurance ®Wells Fargo Financial Leasing to be listed as the Lenders loss payable endor-serrient. Name of Insurance Agency: Phone Number of Agency: Mailing Address of Agency: Email Address of Fax Number of Agency: "In accordance with the term of our Master Equipment Lease Agreement with Wells Fargo Financial Leasing, Inc. ("Wells Fargo'), we maintain the liability and property insurance coverage as described above. We hereby authorize Wells Fargo to contact the agencies identified above and further authorize the agencies to issue insurance certificates to Wells Fargo." Lessee Sign�Ure Date Send to Wells Fargo Financial Leasing, Inc. via mail to: Wells Fargo Financial Leasing, Inc., Golf and Turf Division, MAC# N0005- 044, 800 Walnut Street, Des Moines, IA 50309; or via Fax to: Wells Fargo Financial Leasing, Inc., attn: Golf and Turf Division Fax #866-336-8375. Contact Date: Insurance Company(s): Policy No(s): Office Use Contact Name: Expiration Date(s): I Insured Value: Named Sole Loss Payee: Wells Fargo Financial Leasing, Inc. Verified By: Li YES LJ WILL BE ADDED Additional Insured: Wells Fargo Financial Leasing, Inc. YES I l WILL BE ADDED Public Liability Insurance Limits: 60602-v8 Authorization for Automatic Payment Plan Wells Fargo Financial Leasing, Inc. I Boo Walnut Street, 5'n Floorl Des Moines, Iowa 50309 1 Phone: 866-497-6661 Title of lease, rental or other agreement: Master E-guinment Lease Agreement (the "Agreement") You authorize regularly scheduled payments and all other obligations due and owing under or in connection with the above - referenced Agreement to be made from your account referenced below (the "Debit Account"). Your payments will be made automatically on the contract due date as indicated on your invoice. Proof of payment will appear with your bank statement. The authority you give to charge your Debit Account will remain in effect for the above -referenced Agreement until you notify us that you wish to terminate the authorization and we have had a reasonable opportunity to act on it. Please make your regular payment until your invoice indicates that the Automatic Payment Plan is in effect. I authorize Wells Fargo Financial Leasing, Inc. ("Creditor") to initiate electronic debit entries to the Debit Account (and, if necessary, electronically credit such Debit Account to correct erroneous debits). I understand that this authority will remain in effect until I notify Creditor in writing at the address or fax number set forth below that I wish to revoke this authorization in such time as to afford Creditor a reasonable opportunity to act on it. I understand that Creditor needs at least 3 days' prior written notice to revoke this authorization. Funds transfers to or from the Debit Account will be governed by the rules of any funds transfer system through which the transfers are made, as amended from time to time, including, without limitation, the National Automated Clearing House Association and any regional association (each, an "ACH"). I agree that electronic debit entries that I authorize comply with all applicable laws, rules and regulations. Landmark Golf Management, LLC Company Name Company Address Authorized Signature and Title Date Bank Name City State Account Number Bank ABA / Routing Number (For checking account, located between the symbols :000000000: on the bottom of your check) This is a checking / savings account. (Circle one). PLEASE RETURN TO: Wells Fargo Financial Leasing, Inc. MAC N0005-055 800 Walnut Street Des Moines, IA 50309 Or Fax to (888) 241-4382 Or E-mail to custornerservice(�)Iinancialse[vicinci.net FOR OFFICE USE ONLY CCAN Number Payment Due Date(s) Agreement Number: Comments: #2433348 v2 (10/27/14) Page 1 of 1 SHERIBUTTREY Page 1 of 1 N N � to N W N �� OD co W n Q z y C N rn 3 cn O z CD z W z LUIR ■ J711111131107u� 0 z co C p w Ill S = c— cn r �O_ zzy� �W Z m-na;b cn r --I G)CD 70 Cf) Om m C Z en mo Z z A a r 54OJ2MBD/727F gjg= g.. cno!?1 0o w r+r � Wz 0 0 https:Hfabst-win.wellsfargo.com/eso/track—label.aspx 6/23/2016 CERTIFICATE OF LIABILITY INSURANCE THI I� FICATE IS ISSUED A R OF INFOMU-TI:ON ONLY AD CONFERS NO RI UPON THE CERTIFI� � r - HOLDER �7IR9 CERTIFICATE DUFS P40T AFF.IRMATI'VELY OR NECrATIVELY AFIENM EXTEND OR ALTER THE COVERAGE AFFORDED BY THI'= POLICIES BELOW. 1'IiIS CERTIFICATE OF INSURANCE 00E$ NOT CONSTITUTE A OE)NTRACT BETV11E-EN THE ISSUING INS LI RER[5], AUTHORED REPRESU TATII,+E OR PRODUCER AIN!D THE CERTIFICATE HIOLDE RL IMPDRT = II 1hv chnift is holdor & , n ADDITIONAL INSLMED, 1ha polpcy Iesl must be t-odorgo. it SL7 ROGATPON 15 W IME D, su d 10 tim %M78 god comdhinns 0 the pulky, artaln In it los may eegLmke dri endo emen9. A stw+uw114 66 UI'6 coFti rc2to does n 31 1:dnrt?r rlghls to Me cerMUH& NOW kl FZPS Bollinger • Swats & Leisdre 150 JFK Parkway; P A Box 3911 :Short H1fs, NJ 0707M390 emn 4¢:: INSUFnrq*) AfFCOVERAGE ��• 19SURER A OgrkIC h-Ate In!.Liwce C*ftWY 9DRED irdmoo OCd )&nagemeft and Sk*IR 11194art I-1 TP Atyrlanteam Lary OyinEa. CA 92253 IHEU ER B wa yarn c Iris raEP lI ikSUaER E I KUKE RF C -11TIP"TE MUMBER: N0TWITFPSTANQIH?J ANY RIiCfL1H2E61ENT. TEFht M C(MMITION Of ,ANY CONTRACT QR 4THEA DOCUMENT VMI-i RE5PFCT M ti'SLHFCH THIS CE}i11W�,4i� MAY EiE MLkED QR MAY Pr.PoTAIN Tkf N.WRANGE AFFCVOED 19Y THE POUCW-5 -PE6GRIBM 4EWJN iS SUBJECT T¢ ALL THE TFMMA B(Up 5 AND OOMMIONS OF LH YVLF.,IC.7. LFW40 Omk rn rr l n 1M o ?A rn7W QF Ih3urtAWE Vhn w • FCAJ :T NMASER 40 4GEMM4k U—L3TY {O-'J %FPQI LIAHILlry ISFRrw C AIh,;� Mr, :I r;EKL AWRE13ATE L?JIT APPUr* 6t:1 POLICY " i LOC �Lx•DM 14251-5 1irdZ315 ! 115.r�i r EACLIMMS H 8{CJRRENTE1NCE a.00L`. fHlfl w a E}Y mr pxsu�l 1 C�4 ERSM& a +b`' INA Rr 10M.DDD AeaMDATS 53 CCQC 4 fl00UGTS 4��` atC 00O 00� ,rUT{M*RLLE L ABLITY ANYALUrD %4&'dm �T���+¢1j1 •fD +I HMED A ;RCLE +UJ I'2111ED o 90DLy IhLRH7y fr- P-1 HoDiLV MVIA2Y T4i mduyl Pra�rwr w�a For UNER1<1.Lt Llap of:LuR EKW-" LIAR {LAMS rJKM 7rp F+TFNT*k E N r�I�i IJ4DfriLf TE YY ppEP TZPPv�Mc�RR�F L44 MA FIGEFI++EWOCK t TFILu s*2LrfnE u Ij {v+dlzYM1 'Hie � 4T hdow BM L�dH AC{xEHr L 13t5!EAS5 - • F.a EMPLCM E:E L DI;ME-PULIC'rLwrt ESCAIPT75 DR 1PIUch AOOPD i-M. Mdo+ a ul An a'9:hmJuk, it - �1wp b rqqusadF w r whfirAr.. Hillder is r58rr*d 85 L06s P;1 e1!o tida iaPal ItSLIred arr respq7mi an 1Fxr hieI-esl rray aapew EWWr.ATE HQL-Er.F _ -CAr#CELLATIOM ky Srf La ai Aa A" Cak TONVim -SHOULD AM of THE +1jpc�rvk pEstaIaM Pauc1ES a C.LWXLLED SEF-0RE T,E fKPIRATiCm OATS THEREOF. NDTICE WILL st DELivEREP ACCORD0,WCrP Yr1TH THE PCLCY PAOMIGN6 CCCIRD 25 f2blw r Tile ACORD mono and Ic-go are re9le4dred Irlark, of . CORD POLICY NUMBER: -L?,-I 1425?4-5 OOMW IBC IAL GEN I; RAL LIAGfLfrY CG292606413 THIS ENDORSEMENT CHANGES THE POLICY_ PLEASE BEAD IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION Ti w gndi?mement modifies insurano.- provided Udder the forJvwing: COMM E RCIAL OEN-r=RAL LIABILITY VERAQ-F PART SCHEDULE Narne Of .Additional Insured Pemon(s) Or or-ganization(s): City of La Ouinia 7M!�5 Calle Tampnoo La Quinta, CA 92253 M respects to as tnegr Ir4erdi-St may appear I nfarmatian to complete th is $aedu le, of ncA sihowin above, wiW be shown in titre DadaratiDns A. Soetion II' - Who Is An lrtizured i$ amended to include as are addincinal imaved the persorii(s) Qr organIzalion(s) shown in the S0Mule, but only with re!& MCA to liability for "bodily query', -pr rtyr damage Dr `personal and advertising inj:ury'' -caul. In whole or irr pact, by your acts or 0mrS$10n& or the axis Or cmissiorkS of thosk-acting an your behalf: 1. Irr the perfvrmmce of your ongoing operations �r 2. In wnnmtion wMi your pra%rr«iso$ owned by D�r rented to you. Hor mr-.. 1. The insuran,ce afforded ko 5uc-h ad&or insured only applied tO Me extent permitted t�y raw, and 2_ ff oowerage pr.Gvic d to tf* addi#mal iinsurad Is required by -a corrtract -or agraernenL the Insuranma afforded to such additional insured will not be broader than that which you -are required by the o¢a Vact or agm-pmerrt tQ pmvidc for such additional GnsufE-il. O- Witl� reSpect to the mi$urjDLnoe afforded tD jhese addit-011al Insured, the f-cllowi ng ,s added tv Section III - Llrnlis Of tnogrance= If civerage providedi to the additional Fn:5u red is req urred by a -co"Oct yr agreement, the -mos�! wo %will pay an be"Ir of the additaanal insUret IS the arnou nt of insurance: 1. Required by the contras rar agreement; or .2. Ava�ilatxle iunftr Me applirable Limits of ln&uranoa sriown in the veclarabwr.: whichever is lass. This endorsement shall riot increase the aPPI b3e Limits of lnsurarice� !s* wn in the Daclaral*ns OG 20 26 04 13 (�) Irsuranca Service$ Offkoe. inc, 2(172 Page 1 of I