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HomeMy WebLinkAboutGilroy Golf Course - 2017 AgreementAGREEMENT FOR GOLF COURSE SERVICES This Agreement for Golf Course Services ( "Agreement ") is dated and effective as of July 1, 2017 by and between the City of Gilroy, a municipal corporation ( "City ") and Gilroy Golf Course, Inc., a California corporation ( "Operator"). The City and Operator maybe referred to individually as a "Party" or j ointly as the "Parties." WHEREAS, City and Operator entered into that certain Agreement For Golf Course Services, dated effective as of January 1, 2012 (as amended, the "Prior Agreement "). The Prior Agreement expired on June 30, 2017. WHEREAS, City and Operator desire to enter into this Agreement effective as of July 1, 2017. NOW THEREFORE, the Parties do agree as follows: Article 1. Definitions As used in this Agreement, the following words and phrases, unless otherwise provided, shall have the following meanings: (a) Day: Calendar day. (b) Administrator: The City Administrator for the City of Gilroy, or his or her designee. (c) Golf Course: The 11 -hole municipal golf course located at 2695 Hecker Pass Highway in Gilroy, California, and commonly referred to as the City of Gilroy Golf Course. (d) Clubhouse: The golf pro shop, which includes a golf shop, snack bar, kitchen, office and restrooms. (e) Residence: The single - family residence located on the Golf Course. Article 2. Term of Agreement, Termination of Prior Agreement. (a) Term of Agreement. Upon execution of this Agreement by City and Operator, this Agreement shall be deemed effective as of July 1, 2017, and will continue in effect through June 30, 2022 ( "Original Term "), unless terminated prior to that date in accordance with the provisions of Article 8 of this Agreement or extended pursuant to the express terms and conditions of Article 2(c) below. (b) Termination of Prior Agreement. The Parties acknowledge and agree that the Prior Agreement terminated effective as of June 30, 2017. (c) Options to Extend. At the end of the Original Term, Operator may elect (each an "Option" and, collectively, the "Options ") to extend the term of this Agreement for up to three (3) additional five (5) year terms (the "First, Second and Third Extension Terms ") by giving City not less than one hundred eighty (180) days' written notice prior to the end of the Original Term, First Extension Term or Second Extension Term (as the case may be). The maximum term of this Agreement is twenty (20) years. To the extent Operator duly exercises its extension rights in accordance with the terms and conditions of this Article 2(c), the First Extension Term, Second Extension Term and Third Extension Term shall each -1- 4835 -0470 -3051 v2 SSCORDELIS104706083 be upon and subject to the terms and conditions set forth in this Agreement (as the same may be amended). Operator shall have no right to extend the term of this Agreement except as provided in this Article 2(c) above. The First Extension Term shall commence upon the expiration of the Original Term, the Second Extension Term shall commence upon the expiration of the First Extension Term and the Third Extension Term shall commence upon the expiration of the Second Extension Term. Operator may not exercise the second Option if Operator has not exercised the first Option, nor may Operator exercise the third Option if Operator has not exercised the second Option. The Options shall be personal to Gilroy Golf Course, Inc., a California corporation ( "GGC "), and shall not be transferable or assignable to any assignee of this Agreement, or any other third party. GGC's exercise of an Option shall be of no force or effect if a default exists under any of the terms, covenants or conditions of this Agreement (as the same may be amended) at the time of Operator's exercise of the applicable Option. If a default ripens or occurs at any time after Operator exercises the applicable Option and prior to the commencement date of the First, Second or Third Extension Term (as the case may be), then Operator's exercise of the applicable Option shall be of no force or effect, and Operator shall have no rights hereunder to extend the term of this Agreement. (d) Should Operator, with City's prior written consent, hold over after expiration of this Agreement, Operator shall continue operating the Golf Course upon each and all of the terms herein provided (as may be applicable to a month -to -month operation), and any such holding over shall not constitute an extension of this Agreement. In no event shall Operator have the right to hold over after the expiration or earlier termination of this Agreement without City's prior written consent. If Operator fails to surrender the Golf Course upon the expiration or earlier termination of this Agreement, Operator shall indemnify, defend and hold City harmless from all costs, losses, expenses or liabilities resulting therefrom, including without limitation, costs and attorney fees, and any loss or liability resulting from any claim against Operator made by any succeeding operator or prospective operator founded on or resulting from such delay and losses to City due to lost opportunities to penTut the use and operation of any portion of the Golf Course to any such succeeding operator or prospective operator, together with, in each case, actual attorneys' fees and costs. Notwithstanding anything to the contrary contained in this Agreement, if Operator holds over after the expiration of this Agreement with City's written consent, either Party shall have the right to terminate this Agreement upon thirty (30) days' prior written notice. Article 3. Independent Status. It is the express intention of the Parties that Operator is an independent contractor and not an employee, agent, joint venturer or partner of City. Nothing in this Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between City and Operator or any agents, employees, assistants, suboperators, contractors, or licensees of Operator. Both parties acknowledge that Operator is not an employee for state or federal tax purposes. Operator shall not be entitled to any of the rights or benefits afforded to City's employees, including, without limitation, disability or unemployment insurance, workers' compensation, medical insurance, sick leave, retirement benefits or any other employment benefits. Operator shall retain the right to perform services for others during the term of this Agreement. Article 4. Services to Be Performed by Operator. (a) Specific Services. Operator shall perform the services described in this Agreement, including but not limited to the services outlined in Exhibit "A" ( "Specific Provisions ") and Exhibit `B" ( "Scope of Services "), both of which exhibits are incorporated herein by this reference. 4835 -0470 --3051v2 - - -- SSCORDELIS104706083 ___ _ - -__ = (b) Method of Performing Services. Operator shall determine the method, details and means of performing the above - described services. City shall have no right to, and shall not, controi the manner or determine the method of accomplishing Operator's services. (c) Employment of Assistants. Operator may, at the Operator's own expense, employ such assistants as Operator deems necessary to perform the services required of Operator by this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 6 below. City may not control, direct, or supervise Operator's assistants in the performance of those services. Operator assumes full and sole responsibility for the payment of all compensation and expenses of these assistants and for all state and federal income tax, unemployment insurance, Social Security, disability insurance and other applicable withholding. (d) Place of Work. Operator shall perform the services required by this Agreement at any place or location and at such times as Operator shall determine is necessary to properly and timely perform Operator's services. Article 5. Compensation. (a) Operator to Retain Gross Receipts. In consideration for the services to be performed by Operator, City agrees that Operator shall collect and retain all Gross Receipts (defined in Exhibit "C), subject to the terms and conditions of Exhibit "C," "Compensation," which is incorporated by this reference and made a part of this Agreement hereby. (b) Operator to Make Payments to City. In consideration for Operator's right to use the Golf Course property owned by the City as provided hereunder, Operator agrees to make payments to the City as provided in Exhibit "C," "Compensation." (c) Expenses. Operator shall be responsible for all costs and expenses incident to the performance of services hereunder, including but not limited to, all costs of equipment used or provided by Operator, all fees, fines, licenses, bonds or taxes required of or imposed upon Operator and for all other of Operator's costs of doing business. The City shall not be responsible for any portion of any expenses incurred by Operator in performing services for City. Article 6. Obligations of Operator. (a) Compliance with Laws and Policies. Operator shall perform each duty and obligation imposed herein in full compliance with the Gilroy City Code and other ordinances of the City, and all federal, state and local laws, statutes, rules, regulations and orders, including, but not limited to, laws, statutes, rules, regulations and orders pertaining to the environment, labor and wage standards, non - discrimination in employment and toward members of the 4835 -0470 -3051 v2 - - - - - - - - - - - -- - - - - - SSCORDELIS104706083 public, injury, accident, safety, payroll, and accounts payable. Operator shall abide by policies, rules and regulations promulgated by City, and by other applicable standards, including health and safety standards. Operator shall obtain and maintain, during the entire term of this Agreement (as the same may be extended), a Gilroy Municipal Business License. (b) Standard of Performance. (i) Golf Course Services. Operator agrees to provide a high standard of performance in the execution of all obligations and duties under this Agreement, particularly with respect to service given directly to players and the public utilizing the Golf Course, and equipment, supplies and materials provided or used. Operator shall assure that the Golf Course is maintained at an equal or higher standard than the Golf Course is maintained immediately preceding the effective date of this Agreement. The City reserves the right to set and change standards of performance for the operation and maintenance of the Golf Course. (ii) Repair and Maintenance of Structures and Facilities on Golf Course Property. Operator shall have full and sole responsibility (subject to reimbursement for capital expenditures from the Capital Improvement Fund described in Article 6(b)(iii) below) for the repair and maintenance of all structures, amenities and facilities at the Golf Course including, but not limited to, the following structures, amenities and facilities: the Residence; the Clubhouse; any and all buildings and fences; utilities, including without limitation water, sewer and recycled water; fairways; greens; tees; carts; parking and driving areas; and pedestrian walkways and cart paths. It is the express intent of the Parties that the City cease to have any responsibility for repairs or maintenance at the Golf Course and that Operator have sole responsibility to make repairs and maintain the Golf Course, with the sole exception being that the City will be responsible for the replacement of the septic tank and septic system if and when either fails or connection to the City sewer system at the property line when available. Notwithstanding the foregoing, if, during the term of this Agreement, an incident occurs in which the irrigation water line (as more particularly shown on Exhibit "D" attached hereto) between the meter and the water tank breaks down, and such irrigation water line has been maintained properly by Operator, Operator shall be responsible for the cost to repair or replace such irrigation water line only up to Five Thousand Dollars ($5,000.00) per incident; provided, however, that in no event shall Operator be entitled to reimbursement from the Capital Improvement Fund for any such repair and/or replacement costs relating to the irrigation water line, it being the intent of the Parties that any such amount (up to Five Thousand Dollars ($5,000.00)) shall be paid by Operator out -of- pocket. City shall have the option to cover the cost to repair or replace the broken equipment in such irrigation water line exceeding Five Thousand Dollars ($5,000.00), or alternatively to terminate this Agreement upon ninety (90) days prior written notice to Operator. The election of either option by City shall not constitute a default by City hereunder. If multiple components of the irrigation water line concurrently break down, then the concurrent break downs shall be treated as one incident and costs to repair or replace the irrigation water line shall be calculated cumulatively such that Operator is responsible only for costs of repairs or replacement of broken equipment up to Five Thousand Dollars ($5,000.00) per incident. (iii) Capital Improvement Fund. Concurrently with each Installment Payment (defined in Exhibit "C "), commencing with the thirteenth (130) Installment Payment due under this Agreement, Operator shall deliver, in addition to the other amounts due by Operator pursuant to the terms and conditions of this Agreement, a percentage of the Gross Receipts (such percentage being specified in Gross Receipts Schedule 2 of Exhibit "C ") from the preceding calendar month to City, which City shall deposit into an account which shall referred to as the "Capital Improvement Fund." Subject to the terms and conditions of this Article 6(b)(iii) below, Operator shall have right to draw from the Capital Improvement Fund for purposes of performing, or causing to be performed, capital improvements to the Golf Course. Except as otherwise expressly set forth in this Article 6(b)(iii) below, the -4- 4835 -0470 -3051 v2 SSCORDELIS104706083 Capital Improvement Fund shall be used solely for the purpose of performing capital additions to the Golf Course and/or capital items in need of repair ( "Capital Work "). The Parties hereby agree and acknowledge that the following capital repairs and improvements qualify as Capital Work: (i) cart path and retaining wall replacement, (ii) maintenance area and BBQ improvements, (iii) driving range and (iv) driveway fencing and front gate replacement. Any and all work performed by Operator in connection with the Capital Work shall be subject to City's prior written consent in each instance, and otherwise be performed in accordance with all of the terms and conditions of this Agreement. Prior to the commencement of any work relating to the Capital Work, Operator shall provide City with a reasonably - detailed estimate of the cost of the Capital Work ( "Capital Work Estimate "). Operator may request disbursements from the Capital Improvement Fund to defray the cost of the Capital Work not more frequently than once each month during the term of this Agreement (subject to the availability of funds in the Capital Improvement Fund). City shall in no event be obligated to make any disbursements of the Capital Improvement Fund if a default by Operator then exists under this Agreement (as the same may be amended). No disbursements shall be made until all of the work being performed in connection with the Capital Work is approved by Operator. Each request for disbursement shall be accompanied by: (i) a written request for disbursement itemizing each category of cost for which payment is requested, in form and content reasonably acceptable to City; (ii) conditional lien releases, in a form and content satisfactory to City, from all persons and entities providing work or materials covered by such request; (iii) unconditional lien releases from all persons or entities providing work or materials who were paid out of the prior disbursement; and (iv) invoices, vouchers, statements, affidavits and/or other documents in a form reasonably acceptable to City which substantiate and justify the disbursement requested. Within thirty (30) days after City's receipt of each fully completed disbursement request, City shall pay ninety percent (90 %) of the portion of the Capital Improvement Fund sought to be disbursed (or one hundred percent (100 %) of that amount if the Operator has requested only ninety percent (90 %) of the value of the work completed) directly to the Operator, or, in City's sole and absolute discretion, to Operator by check(s) payable jointly to Operator and the contractor(s), the subcontractors, laborers, or suppliers entitled thereto; provided, however, City reserves the right to reasonably disapprove some or all of the matters disclosed by such disbursement request and to withhold the amounts relating to the disapproved matters from the disbursement. The ten percent (10 %) remaining after any of the above disbursements shall be paid by City within thirty-five (35) days after all of the following have occurred: (x) Operator has submitted a final request for disbursement in accordance with the procedure set forth in this Article 6(b)(iii), (y) if required by City (in City's sole and absolute discretion), a notice of completion has been duly recorded in accordance with applicable law with respect to the Capital Work, and (z) no lien claim shall have been recorded within the thirty (30) day period following such recordation (or, if a lien claim shall have been recorded, such lien shall have been removed). If the Capital Work Estimate exceeds the funds available in the Capital Improvement Fund, then each disbursement shall be in an amount equal to the proportion of the cost of each Capital Work item completed and covered by the disbursement request, multiplied by a fraction, the numerator of which is the available funds in the Capital Improvement Fund, and the denominator of which is the amount of the Capital Work Estimate (and subject to the ten percent (10 %) retention described in this Article 6(b)(iii) above). In such event, Operator shall pay to its contractor(s), and any other party(ies) entitled thereto, on a progress - payment basis, any portions of the cost of the Capital Work not paid through the Capital Improvement Fund, as and when such amount(s) are due and payable to such party(ies). Notwithstanding anything to the contrary contained in this Article 6(b)(iii), City shall have no obligation to disburse any amounts from the Capital Improvement Fund with respect to any disbursement request(s) received by City after the expiration of the term of this Agreement, it being the intent of the parties that, from and after such date, any remaining portion of the Capital Improvement Fund shall be deemed to have reverted to City, and Operator shall have no further rights with respect thereto. -5- 4835 -0470 -30510 SSCORDEL004706083 (c) Workers' Compensation. Operator agrees to provide workers' compensation insurance for Operator's employees and agents and agrees to hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees from and against any and all claims, suits, damages, costs, expenses, fees, demands, awards, causes of action, losses, fines, penalties, and liabilities including without limitation attorneys' fees (collectively, "Claims "), arising out of any injury, disability, or death of any of Operator's employees and agents. Operator's indemnification, defense and hold harmless obligations under this subsection (c) shall survive the termination of this Agreement. (d) Indemnification of Liability, Duty to Defend. To the fullest extent permitted by law, Operator shall hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees against any and all Claims, including without limitation all Claims relating to the injury or death of any person or damage to any property, to the extent arising or resulting directly or indirectly from (i) any act or omission of Operator or Operator's agents, employees, assistants, suboperators, contractors, invitees, or licensees, (ii) any occurrence, activity or condition at or in any way related to the Golf Course, or (iii) any breach of Operator's obligations under this Agreement. The provisions of this subsection (d) shall survive the termination of this Agreement. (e) Insurance. (i) Insurance Mandatory. Operator shall procure and maintain for the duration of this Agreement insurance against claims for injuries to persons or damages to property which may arise from or in connection with any occurrence, activity or condition at or concerning the Golf Course or any structure, amenity or facility of any kind or type thereon, or the performance of the services, work and operations by the Operator, his agents, employees, assistants, suboperators, or contractors and the results of those services, work and operations. (ii) Minimum Scope of Insurance. Coverage shall be at least as broad as: (A) Insurance Services Office Form CG 0001 covering Commercial General Liability on an "occurrence" basis. (B) Insurance Services Office Form Number CA 0001 covering Automobile Liability, Code 1 (any auto), or Code 8 (hired) and 9 (non- owned) if Operator has no owned autos. (C) Workers' Compensation insurance as required by the State of California and (D) Employer's Liability Insurance. (E) Property insurance against all risks of loss to all buildings on the Golf Course property and to tenant improvements or betterments. 4835 -0470 -3051 v2 SSCORDELIS104706083 (iii) Minimum Limits of Insurance. Operator shall maintain limits no less than: (A) General Liability: (Including products - completed operations, personal & advertising injury) $2,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. (B) Automobile Liability: $1,000,000 per accident for bodily injury and property damage. (C) Employer's Liability: $1,000,000 per accident for bodily injury or disease. (D) Property Insurance: Full replacement cost with no coinsurance penalty provision. (iv) Deductibles and Self - Insured Retentions. Any deductibles or self - insured retentions must be declared to and approved by the City. The City may require the Operator to provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. (v) Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions: (A) The City, its officers, officials, employees, and volunteers are to be covered as additional insureds with respect to liability arising out of services, work or operations performed by or on behalf of the Operator including materials, parts or equipment furnished in connection with such services, work or operations, and property insurance shall name City as loss payee. General liability coverage can be provided in the form of an endorsement to the Operator's insurance (at least as broad as ISO Form CG 2010 11 85). (B) For any claims related to the Golf Course, the Operator's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, and volunteers. Any insurance or self - insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Operator's insurance and shall not contribute with it. (C) The Operator's insurance company agrees to waive all rights of subrogation against the City, its elected or appointed officers, officials, agents and employees for losses paid under the terms of any policy which arise from work performed by the named insured under this Agreement. -7- 4835 -0470 -3051 v2 SSCORDELIS104706083 This provision also applies to the Operator's Workers' Compensation policy. (D) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be canceled by either Party, except after thirty (30) days' prior written notice (10 days for non - payment) by certified mail, return receipt requested, has been given to the City. (vi) Acceptability of Insurers. Insurance is to be placed with an admitted insurer with a current A.M. Best's rating of no less than A:VII. (vii) Verification of Coverage. Operator shall furnish the City with original certificates and amendatory endorsements effecting coverage required by this clause. All certificates and endorsements are to be received and approved by the City before work commences. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications, at any time. (f) Assignment. Notwithstanding any other provision of this Agreement, neither this Agreement nor any duties or obligations of Operator under this Agreement may be assigned or subcontracted by Operator without the prior written approval of City, which City may withhold in its sole and absolute discretion. (g) State and Federal Taxes. As Operator is not City's employee, Operator shall be responsible for paying all required state and federal taxes. Without limiting the foregoing, Operator acknowledges and agrees that: • City will not withhold FICA (Social Security) from Operator's payments; • City will not make state or federal unemployment insurance contributions on Operator's behalf, • City will not withhold state or federal income tax from any payment City might make to Operator; • City will not make disability insurance contributions on behalf of Operator; • City will not obtain workers' compensation insurance on behalf of Operator. Article 7. Obligations of City. (a) Cooperation of City. City agrees to respond to all reasonable requests of Operator and provide access, at reasonable times following receipt by City of reasonable notice, to all documents reasonably necessary to performance of Operator's duties under this Agreement. -8- 4835 -0470 -3051 v2 SSCORDELIN4706083 (b) Assignment. City may assign this Agreement or any duties or obligations hereunder without the consent of Operator. Such assignment shall not relieve Operator from any of Operator's duties or obligations under this Agreement. Article 8. Termination of Agreement. (a) Termination on Occurrence of Stated Events. This Agreement will terminate on the occurrence of any of the following events: (i) At City's option, for any reason, upon not less than one hundred eighty (180) days' prior written notice. (ii) At City's option, upon the bankruptcy of either Party. (iii) At City's option, upon the event of a national, state, or local emergency or act of God which in the reasonable determination of City ends the need for continuing Golf Course operations. (iv) At City's option, upon the sale or transfer of the Golf Course real property to a third ply. (v) At City's option, upon City's written notice to Operator after Operator's failure to submit to the City, on or before August 15 of each year beginning in the year 2019, an accounting of all Gross Receipts for the previous year, together with (1) proof that Operator maintains insurance as required under Article 6 section (e), "Insurance," of this Agreement, and (2) any amount owed City for the previous year above the sum of the Installment Payments made in such prior year. (b) Termination by City for Default of Operator. Should Operator default in the performance of this Agreement or materially breach any of its provisions, City, at City's option, may terminate this Agreement by giving written notification to Operator. For the purposes of tlus section, material breach of this Agreement shall include, but not be limited to the following: (i) Operator's failure to professionally and/or timely perform any of the services contemplated by this Agreement. this Agreement. (ii) Operator's breach of any of its representations, warranties or covenants contained in (iii) Operator's failure to timely make one or more payment(s) to City when due. (iv) A decline, after the effective date of this Agreement, in the maintenance or condition of, or services provided at, the Golf Course, or in the physical condition of any structures, amenities and facilities located on the Golf Course, as reasonably determined by City. (v) Failure to perform the maintenance and improvements obligations stated in Article 6 and elsewhere in this Agreement. 4835 -0470 -3051 v2 SSCORDELIS104706083 (vi) Failure or refusal of Operator to maintain all books and records in accordance with standard California accounting practices or to submit to audit of Operator's books and records (including, but not limited to, invoices, vouchers, cancelled checks, time cards, receipts, sales records, and similar documents), as required by Section IIIB of Exhibit "A" of this Agreement. In the event of Operator's default, City shall be entitled to pursue any and all remedies available to City at law or in equity. Operator shall be entitled to payment out of Gross Receipts, as defined hereinafter in Exhibit "C ", only for services satisfactorily performed through the date of termination, as reasonably determined by City or adjudged by a court. (c) Transition After Termination. Upon termination, Operator shall immediately stop work, unless cessation could potentially cause any damage or harm to person or property, in which case Operator shall cease such work as soon as it is safe to do so. Operator shall incur no further expenses in connection with this Agreement, Operator shall reimburse City, within ten (10) days after demand, for any and all costs and expenses incurred by City in order to complete the tasks that Operator is obligated to perform under this Agreement, and such reimbursement shall include Gross Receipts as hereinafter defined in Exhibit "C ", to the extent that such Gross Receipts constitute payment for services not yet rendered. Upon termination of this Agreement, Operator shall reimburse City to the extent that Gross Receipts received constitute payment for services not yet rendered and reimburse City on a pro rata basis for the unexpired portion of all annual, semi - annual, monthly and/or quarterly passes sold to date. Operator shall act in such a manner as to facilitate any new Operator's assumption of duties. Article 9. General Provisions. (a) Amendment & Modification. No amendments, modifications, alterations or changes to the terms of this Agreement shall be effective unless and until made in a writing signed by both Parties hereto. (b) Americans with Disabilities Act of 1990. Throughout the term of this Agreement, the Operator shall comply fully with all applicable provisions of the Americans With Disabilities Act of 1990 ( "the Act ") in its current form and as it may be amended from time to time. Operator shall also require such compliance of all suboperator performing work under this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 6 above. The Operator shall hold harmless, defend with counsel acceptable to City and indemnify City and City's officers, representatives, agents and employees from and against all Claims that may arise out of any violations of the Act by the Operator, or Operator's agents, employees, assistants, suboperator, licensees or contractors. (c) Attorneys' Fees. If any action at law or in equity, including without limitation an action for declaratory relief, is brought to enforce or interpret the provisions of this Agreement, the prevailing party will be entitled to reasonable attorneys' fees, which may be set by the court in the same action or in a separate action brought for that purpose, in addition to any other relief to which that Party may be entitled. 4835 -0470 -3051 v2 SSCORDELIS104706083 (d) Captions. The captions and headings of the various sections, paragraphs and subparagraphs of the Agreement are for convenience only and shall not be considered nor referred to for resolving questions of interpretation. (e) Conflict of Interest. Operator certifies that to the best of its knowledge, no City employee or office of any public agency interested in this Agreement has any pecuniary interest in the business of Operator and that no person associated with Operator has any interest that would constitute a conflict of interest in any manner or degree as to the execution or performance of this Agreement. (f) Emergency Services. Operator shall provide Director with names, mobile phone numbers and e-mail addresses of at least two (2) qualified employees or principals of Operator who are available on a twenty -four (24) hour basis when conditions occur requiring emergency maintenance during hours when Operator's normal workforce is not present. During any period of severe inclement weather conditions, Operator will provide sufficient personnel on a twenty -four (24) hour call basis for the purposes of sandbagging, drainage clearance, and/or other tasks required to prevent serious damage to Golf Course improvements, grounds and facilities. (g) Entire Agreement. This Agreement supersedes any and all prior agreements, whether oral or written, between the parties hereto with respect to the rendering of services by Operator for City with respect to the subject matter contained in this Agreement and contains all the covenants and agreements between the parties with respect to the rendering of such services in any manner whatsoever. Each Party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding. No other agreements or conversation with any officer, agent or employee of City prior to execution of this Agreement shall affect or modify any of the terms or obligations contained in any documents comprising this Agreement. Such other agreements or conversations shall be considered as unofficial information and in no way binding upon City. (h) Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of California. (i) Hazardous Substances. (i) Operator represents and warrants that the services it and any suboperator will provide, the methods of application it and any suboperator will use, and the products it and any suboperator will use will not violate and will comply with any federal, state, or local environmental laws, statutes, ordinances, codes, rules, regulations, order, decrees or similar authoritative pronouncements now or hereafter in effect. Operator shall obtain and keep current a hazardous maierial storage permit from the Gilroy Chemical Control Program for all Hazardous Substances used or stored on the Golf Course (the "Hazardous Materials Storage Permit "). All requirements and conditions of the Hazardous Materials Storage Permit shall = =- -11- 4835 -0470 -3051 v2 - SSCORDELISl04706083 be the responsibility of Operator. For purposes of this Agreement, "Hazardous Substances" shall mean any and all substances, materials or wastes (whether liquid, solid or gaseous or otherwise), which are a pollutant or contaminant, or which are hazardous, toxic, ignitable, reactive, corrosive, dangerous, harmful or injurious, or which present a risk to public health or the environment, or which are or may become regulated by or under the authority of any Environmental Laws, as defined below, including, without limitation, asbestos or asbestos containing materials, petroleum products, pesticides, polychlorinated biphenyls, flammable explosives, radioactive materials and urea formaldehyde. As used herein, the term "Environmental Laws" shall mean any present or future federal, state or local laws, whether common law, statute, rule, regulation or ordinance, judgment, order, or other governmental restriction, guideline, listing or requirement, relating to the environment or any Hazardous Substances, including without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §6901 et seq., Federal Water Pollution Control Act, 33 U.S.C. Section 1251, et sec.., and applicable provisions of the California Health and Safety Code and the California Water Code, all as they currently exist or may hereafter be amended from time to time. (ii) Operator hereby agrees to defend with counsel reasonably acceptable to City, indemnify and hold City and City's officers, representatives, agents and employees harmless from and against any and all Claims as a result of violations of this Article 9. The provisions of this subsection (ii) and (iii) of this Article 9 shall survive the termination of this Agreement. (iii) The indemnification, defense and hold harmless obligations under this Article 9 shall include, but not be limited to, any and all Claims directly or indirectly resulting from the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission or release from or on, the Golf Course of any Hazardous Substances caused by or within the control of Operator, or any of Operator's agents, employees, assistants, suboperators, contractors, invitees, or licensees. (iv) If Operator causes, knows of, or receives any written or verbal notice of the happening of any event following the use, spill, release, leak, seepage, discharge or cleanup of any governmental authority which notice lists any noncompliance, order, citation or notice with regard to air emissions, water discharges, or any other environmental, health or safety matter affecting the Golf Course or City (an "Environmental Complaint ") from any person or entity (including without limitation, the EPA), Operator shall immediately notify City orally and in writing of such notice, and provide any and all supporting information, document, complaint, or order regarding the same. (v) City shall have the right, but not the obligation and without limitation of City's rights under this Agreement, to enter onto the Golf Course and such other property as City deems advisable and/or necessary to take such actions as it deems necessary and/or advisable to clean up, remove, or minimize the impact of, or otherwise deal with, any such Hazardous Substances or Environmental Complaint following receipt of any notice from any person or entity (including, without limitation, the EPA) asserting the existence of any Hazardous Substances or an Environmental Complaint. All costs and expenses incurred by City in the exercise of any such rights shall be payable by Operator to City upon demand if caused by or within the control of Operator or any of Operator's agents, employees, assistants, suboperators, contractors, invitees, or licensees. (vi) Operator shall include, in any contract entered into with a third party for services performed at the Golf Course, provisions substantially similar to the provisions contained in this section entitled "Hazardous Substances." - — -12- 4835 -0470 -3051 v2 SSCORDELIS104706083 (j) Construction of Agreement. The language of each and every paragraph, term and/or provision of this Agreement shall, in all cases and circumstances and for any and all purposes, be construed as a whole, according to its fair meaning, and shall not be construed for or against any Party hereto. The Parties agree that this Agreement has been negotiated and jointly drafted by the Parties hereto. (k) Notices. Any notice to be given hereunder by either Party to the other Party shall be effected either by personal delivery in writing or by United States mail, registered or certified, postage pre -paid with return receipt requested. Mailed notices shall be addressed to, and personally delivered notices shall be delivered to, the other Party at the address for such other Party appearing in Exhibit "A," Section III (G) Notices, but either Party may change the address by so notifying the other Party in writing in accordance with this subsection (k). Notices sent in the manner required by this subsection (k) shall be deemed delivered upon the earlier of actual receipt, the date the intended recipient refuses delivery, or the date of failed delivery due to incorrect contact information being provided to the delivering party by the intended recipient. (1) Time of the Essence. All dates and times referred to in this Agreement are of the essence. (m) Work Not Performed Competently. If at any time City determines that any person employed by or under contract with Operator to provide services within the scope of this Agreement has not performed or does not perform any work competently, City shall notify Operator, who shall take immediate corrective action. Operator shall be solely responsible for the hiring, supervision, training, disciplining, and termination of its employees. In the event of any litigation involving the City and an employee, or suboperator of Operator, Operator shall indemnify, defend and hold harmless City and City's officers, employees, agents and representatives pursuant to the provisions stated in Article 6 of this Agreement. (n) Venue. Should either Party institute suit for enforcement or interpretation of any provision contained herein, the venue of such action shall be proper exclusively in State Superior Court in the County of Santa Clara, California. (o) Waiver. Operator agrees that waiver by City of any one or more of the conditions of performance under this Agreement shall not be construed as waiver(s) of any other condition of performance under this Agreement. (p) Partial lnvalidity. If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions will nevertheless continue in full force without being impaired or invalidated in any way. [signatures appear starting on the next page] -13- 4835 -0470 -3051 Q SSCORDELIS104706083 _ _ Executed at Gilroy, California. OPERATOR: GILROY GOLF COURSE, INC., a Cali fo rporation By: 04 Date: 711 5117 Approved, as to Form i City Attorney -14- 4835 -0470 -3051 Q SSCORDELIS104706083 CITY: CITY OF GILROY, a municipal corporation .A S City Clerk Exhibit "A" Specific Provisions I. Pro/Manager. Operator shall provide the services indicated on the attached Exhibit `B," Scope of Services, which is incorporated by this reference and made a part of this Agreement hereby. Operator will personally perform or direct such services. Except as may be specified elsewhere in this Agreement, Operator shall furnish all technical and professional services, including labor, material, equipment, transportation, supervision, expertise, and funding to perform or have performed all operations, maintenance and repairs necessary and required to complete the services required herein to the satisfaction of the City. II. Direct Expenses. Except as otherwise specifically provided in this Agreement, Operator shall be responsible for any and all direct and indirect expenses incurred in the operation, maintenance, and repair of the Golf Course and/or any structure located thereon. III. Other Provisions. A. Responsibility of Operator. Operator shall be responsible for all aspects of the operation of the Golf Course, and all services performed under this Agreement. No act or declination to act by the City shall be construed to operate as a waiver of any rights of City under this Agreement, or of any cause of action arising out of the performance of this Agreement. Operator shall be and remain liable to City in accordance with applicable law for all damages or losses to City arising from Operator's act or omission in connection with the performance of any service furnished under this Agreement. B. Right of City to Inspect Records of Operator /Duty of Operator to Prepare and Maintain Records. City, through its authorized employees, representatives or agents, shall have the right, at any and all reasonable times, to review and audit Operator's books and records (including, but not limited to, invoices, vouchers, cancelled checks, time cards, receipts, sales records, and similar documents) from time to time to verify Gross Receipts, as hereinafter defined, by giving Operator not less than five (5) business days prior notice. Operator shall prepare or cause to have prepared and shall maintain for a period of not less than three (3) years from the date of any transaction, all books and records in accordance with standard California accounting practices, all of which books and records shall be maintained and made available to City at the Golf Course. The provisions of this paragraph B shall survive the termination of this Agreement. C. Confidentiality of Material. All ideas, memoranda, specifications, plans, manufacturing procedures, data (including, but not limited to, computer data and source code), drawings, descriptions, documents, discussions or other information developed or received by or for Operator and all other written and oral information developed or 4835 -0470 -3051 v2 SSCORDELIS104706083 __ received by or for Operator and all other written and oral information submitted to Operator in connection with the performance of this Agreement shall be held confidential by Operator and shall not, without the prior written consent of City, be used for any purposes other than the performance of services under this Agreement, nor be disclosed to an entity not connected with the performance of services under this Agreement. Nothing furnished to Operator which is otherwise previously known to Operator or is or becomes generally known to the related industry (other than that which becomes generally known as the result of Operator's disclosure thereof) shall be deemed confidential. Operator shall not use City's name or insignia, or distribute publicity pertaining to the services rendered under this Agreement in any magazine, trade paper, newspaper or other medium without the express written consent of City. D. No Pledging of f City's Credit. Under no circumstances shall Operator have the authority or power to pledge the credit of City or incur any obligation in the name of City. E. Ownership of Material. All material including, but not limited to, computer information, data and source code, sketches, tracings, drawings, plans, diagrams, quantities, estimates, specifications, proposals, tests, maps, calculations, photographs, reports and other material developed, collected, prepared (or caused to be prepared) under this Agreement shall be the property of City, but Operator may retain and use copies thereof subject to Paragraph B immediately above. City shall not be limited in any way in its use of said material at any time for any work, whether or not associated with this Agreement. F. No Third Party Beneficiary. This Agreement shall not be construed or deemed to be an agreement for the benefit of any third party or parties, and no third party or parties shall have any claim or right of action hereunder for any cause whatsoever. G. Notices. Notices are to be in writing and sent as follows: City: City Administrator City of Gilroy 7351 Rosanna Street Gilroy, CA 95020 Operator: Gilroy Golf Course, Inc. 2695 Hecker Pass Road Gilroy, CA 95020 Attn: Donald DeLorenzo -2- 4835 -0470 -3051 Q SSCORDELIS104706083 Exhibit `B" Scope of Services A. Golf Course Operational Duties. Operator shall: 1. Maintain services and all property at the Golf Course at a level that meets or exceeds the standard of services and property maintenance in existence just before the effective date of this Agreement. To this end, Operator will abide by performance standards set by City governing the maintenance of the Golf Course and the structures thereon. Operator will provide all repairs as reasonably determined by City to be necessary to the clubhouse, cart shed, cart storage, maintenance area, irrigation pump, and other facilities at the Golf Course. Prepare financial reports of all revenues received in a manner prescribed by City. Register all golfers, membership, and daily fee round players prior to starting play. 4. Keep the Clubhouse open on a schedule of reasonable hours to provide food, refreshment, and equipment needs of the golfing public, maintain a snack bar and eating facilities. Hours shall be subject to prior approval by City. 5. Maintain a pro shop and have service available for the repair of golf equipment and a shop in which golf equipment may be purchased. 6. Represent the City's interest with respect to the men's and women's golf clubs. Supervise all golf tournaments and special events at the course. Supervise the junior golf program. 9. Make the Clubhouse available for golf association meetings during hours approved by City and other activities to promote a sound golf program. 10. Provide starting services for golfers. 11. Supervise and regulate play round the course when necessary to maintain speedy, consistent play. 12. Promote golf safety and good golf etiquette. 13. Keep the Clubhouse and course open anytime the course is playable and open. 14. Administer public relations and promotions of the Golf Course and it programs. 15. Prepare and maintain an inventory of all equipment owned by City and its program. 16. Provide golf lessons for groups and individuals at a reasonable cost in line with other local courses. 4835-9t-3051v2 SSCORDELIS104706083 __ 17. Provide range balls and clubs for the range at a reasonable cost and be responsible for safety and supervision of the range. 18. Provide and maintain a sufficient number of pull carts for rent by golfers. 19. Provide and maintain in good running condition a sufficient number of self - propelled carts for rent by golfers. golfers. 20. Provide and maintain a sufficient number of golf clubs of at least average quality for rental to 21. Maintain current knowledge and methods of Golf Course operations. 22. As required by City, attend and provide assistance to meetings of the Gilroy Parks and Recreation Commission, Golf Course Advisory Board, and City Council. 23. Supply, maintain in good condition, and rent to members of the public at reasonable rates approved in writing by City the following Inventory: (a) Range balls; (b) Golf clubs; (c) Pull carts; and (d) Self - propelled golf carts. B. Utilities. (a) Recycled Water. The City will provide recycled water to the Golf Course for irrigation purposes. The Operator shall use such water in the manner prescribed by the City to the greatest extent possible. (b) All Other Utilities. City shall provide and maintain potable water service to the City meter. Operator, at his sole expense, shall furnish and maintain the potable water service from the City meter, and allow City to connect a new sewer service from the property line when available. Operator shall furnish and maintain all other utilities to the Golf Course and structures thereon. Operator may require any tenant of the Residence to reimburse him for utilities services to the Residence. Operator shall not be excused from his obligation to make utility payments by reason of his inability to collect utility payments from any past or present tenant. C. Hours of Operation. The hours of operation at the Golf Course, and any deviation therefrom, must be approved in writing by the City. D. Taxes. Operator shall pay all taxes in any way associated with or relating to the Golf Course or any activity or structure thereon, or this Agreement, whether such tax is federal, state, county or local, including without limitation sales taxes and any taxes that may arise from Operator's interest in the property, if any, and any possessory interest tax. In connection with California Revenue and Taxation Code section 107.6, City states and Operator acknowledges that by entering into this Agreement, a possessory interest subject to property _= -2- 4835 -0470 -3051 Q SSCORDELIS104706083 T_ taxes may be created. Operator or other parties in whom the possessory interest has vested may be subject to the payment of property taxes levied on such interest. E. Maintenance and Improvements. In addition to all other obligations of Operator described in this Agreement, Operator shall, at Operator's sole cost and expense, perform the following maintenance and improvements to Golf Course, structures, amenities and facilities according to the following schedule: l Maintenance/Improvement: Completion Schedule: 1. Clubhouse: Maintain carpeting & flooring and replace On -going as necessary 2. Roof Inspect & maintain annually -3- 4835 -0470 -3051 v2 SSCORDEL004706083 Exhibit "C" Compensation A. COMPENSATION TO OPERATOR Operator shall collect and retain the Gross Receipts from the Golf Course during the term of this Agreement. "Gross Receipts" is hereby defined to mean all revenues or consideration of every kind and derived in any way whatsoever because of or in connection with Operator's operation, use or management of the Golf Course property including, but not limited to, green fees, annual, semi - annual, monthly and quarterly passes sales, cart storage fees, clubhouse sales and services, including without limitation equipment rental and repair, driving range fees, sale of golf merchandise, pull carts and self - propelled carts rentals, and Residence rental. Operator shall be compensated solely from the Gross Receipts and no moneys from any fund of the City shall be used to compensate Operator or to fund Golf Course operations. Subject to the terms and conditions set forth in this paragraph below, the City shall reimburse Operator, in an amount not to exceed Six Thousand Dollars ($6,000.00), for Operator's actual, reasonable and documented out -of- pocket marketing costs and expenses incurred during the fiscal year 2018 to market and promote the Golf Course ( "Marketing Expenses "). In order to be reimbursed for the Marketing Expenses (subject to the Six Thousand Dollar ($6,000.00) cap described in the preceding sentence), Operator may request reimbursement from the City not more frequently than once each month during the fiscal year 2018. Each such reimbursement request must be in writing and submitted along with reasonably - detailed invoice(s) showing the Marketing Expenses for which Operator is requesting reimbursement (such written request and reasonably - detailed invoice(s) being a "Reimbursement Request "). City shall in no event be obligated to reimburse Operator (x) if a default by Operator then exists under this Agreement (as the same may be amended), (y) if the City determines (in its sole and absolute discretion) that Operator is requesting reimbursement for costs and expenses that do not directly market, promote and benefit the Golf Course or (z) for any Reimbursement Request received by the City after June 30, 2018. The City shall use commercially reasonable efforts to reimburse Operator within forty -five (45) days after the City's receipt of a Reimbursement Request that satisfies the terms and conditions of this paragraph above. B. COMPENSATION TO CITY Operator shall pay to the City each year of the term of this Agreement an amount equal to the (i) the Base Amount (defined below), plus (ii) a portion of the Gross Receipts as determined by the Gross Receipts Schedule 1 set forth below. As used in this Agreement, `Base Amount" shall mean: (1) for the fiscal year 2018, the amount of Forty -six Thousand Dollars ($46,000.00), (2) for the fiscal years 2019 and 2020, the amount of Forty Thousand Dollars ($40,000.00), (3) for the fiscal year 2021, the amount of Forty Thousand Dollars ($40,000.00), subject to the CPI Increase described in the following sentence, and (4) for the fiscal year 2022, the amount of Forty -six Thousand Dollars ($46,000.00), subject to the CPI increase described in the following sentence. For the fiscal years 2021 and 2022 and, to the extent applicable, each fiscal year of the First, Second and Third Extension Terms, the Base Amount in effect immediately prior to July 1 of the year of adjustment shall be increased by a sum equal to the product obtained by multiplying such Base Amount by a fraction, the numerator of which is the Consumer Price Index (defined below) published nearest but prior to January 1 of the year of adjustment, and the denominator of which is the Consumer Price Index for the month nearest but prior to July 1 of the calendar year immediately preceding the year of adjustment (the "CPI Increase "). As used in this Agreement, "Consumer Price Index" means the Consumer Price Index (All Items) for All Urban Consumers as published by the United States Department of Labor, Bureau of Labor Statistics, for the San Francisco - Oakland -San Jose, California Area (base years 1982 -1984 = 100). If the Consumer Price Index is discontinued or revised, then such other governmental index or computation with which it is replaced shall be used. If the Consumer Price Index is discontinued but not replaced, then such other comparable price index selected by City shall be used. In no event shall a decrease in the Consumer 4835 -0470 -3051 v2 SSCORDELIS104706083 Price Index result in a decrease in the Base Amount. Solely for purposes of illustration, (x) if the CPI Increase applicable to the fiscal year 2021 is equal to two percent (2 %), then the Base Amount for such fiscal year 2021 shall be the amount of Forty Thousand Eight Hundred Dollars ($40,800.00) (i.e., $40,000.00 x 1.02), (y) if the CPI Increase applicable to the fiscal year 2022 is two percent (2 %), then the Base Amount for such fiscal year 2022 shall be the amount of Forty-seven Thousand Six Hundred Sixteen Dollars ($47,616.00) (i.e., $46,000.00 + $1,616.00 (i.e., the sum of the two percent (2 %) CPI Increases to $40,000.00 and $40,800.00)), and (z) if the CPI Increase applicable to the fiscal-year 2023 (i.e., the first (1 51) fiscal year of the First Extension Term (if applicable)) is two percent (2 %), then the Base Amount for such fiscal year 2023 shall be the amount of Forty -eight Thousand Five Hundred Sixty -eight Dollars and Thirty -two Cents (i.e., $48,568.32) (i.e., $47,616.00 x 1.02). Operator shall pay the above amounts for each year in equal monthly installments (each an "Installment Payment ", and collectively, the "Installment Payments "). The Installment Payments shall be due and payable on or before the 15`'' of each month during the term of this Agreement. In addition, Operator with each Installment Payment shall prepare and remit an accounting of Gross Receipts for the payment period j ust ended to accompany the Installment Payment. On or before August 15 of each year beginning in the year 2019, Operator shall submit to the City an accounting of all Gross Receipts for the previous year, together with (1) proof that Operator maintains insurance as required under Article 6 section (e), "Insurance," of this Agreement, and (2) any amount owed City for the previous year above the sum of the Installment Payments made in such prior year. Operator's failure to submit to City the items described in the preceding sentence shall constitute an express default under the Agreement, and in such case, City shall have the right, in its sole and absolute discretion, to terminate the Agreement upon written notice to Operator (provided, however, that City shall in no event be required to terminate the Agreement). All annual accountings required pursuant to this Section B shall be prepared by a Certified Public Accountant reasonably acceptable to the City and shall clearly set forth to the satisfaction of City the Gross Receipts from each source. If the City's review or audit of any of Operator's books and records as provided for in Section III.B of Exhibit A of this Agreement indicates an underpayment of five percent (5 %) or greater of actual Gross Receipts received, the Operator shall pay the cost of the City's review and audit upon demand. Any payments due from Operator to the City shall bear simple interest at a rate of 1.5% per month. Nothing contained in this Exhibit "C" or in this Agreement shall be construed to extend this Agreement beyond June 30, 2022, or to obligate either Party to agree to an extension of this Agreement unless the term of this Agreement is extended pursuant to the express terms and condition of Article 2(c) hereof. Gross Receipts Schedule 1 Gross Receipts Category Applied to Annual Amounts Percentage Pa ment Merchandise Revenue Tier 1 $50,000 - $56,249 2% Tier 2 $56,250 - $62,499 3% Tier 3 $62,500 and above_ 5% Food and Beverage Revenue Sale of merchandise in the pro shop Z Sale of all food and beverage items and services including catering, snack shop or mobile snack carts, banquets and rental of any or all facilities made by tenant, any affiliate of tenant, or subtenants -2- 4835 -0470 -3051 v2 SSCORDEL004706083 Tier 1 $50,000 - $56,249 3% Tier 2 $56,250 - $62,499 4% Tier 3 $62,500 and above 5% Golf Revenue Tier 1 $575,000 - $624,999 5% Tier 2 $625,000 - $674,999 5% Tier 3 $675,000 and above 20% Gross Receipts Schedule 2 Gross Receipts Category° Applied to Annual Amounts Percentage of Gross Receipts Operator Required to Contribute to the Capital Improvement Fund Tier 1 Up to-and including $575,000 4.5% Tier 2 $575,001- $625,000 4.0% Tier 3 $625,001 and above 3.5% The provisions of this Section (B) shall survive the termination of this Agreement. 3 Admission fees, entry fees, green fees, driving range fees, tournament fees, advance booking fees, rental fees, membership and club dues and other fees and dues of any kind 4 Solely for purposes of illustration, if Operator's Gross Receipts for a year are $650,000 00, then Operator would be required to contribute $22,750 00 to the Capital Improvement Fund. 4835 -0470 -3051 v2 SSCORDELIS104706083 Exhibit "D" Water Irrigation Line [to be attached] -1- -�r 4835 - 0470- 3051v2 SSCORDELIS104706083 _ _ _ SHARED RESPONSIBILITY RECLAIMED WATER IRRIGATION LINE GILRGOL -01 PREILLY .4COR0° CERTIFICATE OF LIABILITY INSURANCE DATE(MMIDDIYYYY) 05/30/2017 - 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(ies) must have ADDITIONAL INSURED provisions or 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 endorsement(s). PRODUCER License # OE02096 DiBuduo & DeFendis Insurance Brokers, LLC P.O. Box 5479 Fresno, CA 93755 -5479 NQNEACT A/CO, No, Ext (559) 432 -0222 ac, No (559) 431 -7941 EDD E _ INSURERS AFFORDING COVERAGE NAIC # 01/0112017 INSURER A West American Insurance Company 44393 $ 1,000,000 INSURED INSURER B American Fire and Casualty Company 24066 INSURER C Technology Insurance Company 42376 Gilroy Golf Course, Inc. INSURER D 2695 Hecker Pass Hwy Gilroy, CA 95020 INSURER E GEN'L AGGREGATE LIMIT APPLIES PER POLICY E JEOT FX LOC OTHER INSURER F $ 2,000,000 PRODUCTS - COMP /OP AGG COVERAGES CERTIFICATE NUMBER: REVISION NUMBFR- 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 ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR LTR TYPE OF INSURANCE ADDL SUER POLICY NUMBER POLICY EFF POLICY EXP LIMITS A X COMMERCIAL GENERAL LIABILITY CLAIMS -MADE [X] OCCUR X BKW56427935 01/0112017 01/01/2018 EACH OCCURRENCE $ 1,000,000 DDAEIAGE TO RENTED SES occurrence) $ 500,000 MED EXP (Any one person) $ 15,000 PERSONAL & ADV INJURY 1,000,000 GEN'L AGGREGATE LIMIT APPLIES PER POLICY E JEOT FX LOC OTHER GENERAL AGGREGATE $ 2,000,000 PRODUCTS - COMP /OP AGG 2,000,000 __ AUTOMOBILE LIABILITY ANY AUTO OWNED SCHEDULED AUTOS ONLY AUTOS AUTOS ONLY AUUTOS ONL� EOMccI d n SINGLE LIMIT $ BODILY INJURY Per arson $ BODILY BODILY INJURY Per accident $ PeFacc dent AMAGE $ $ B UMBRELLA LIAB EXCESS LIAB X OCCUR CLAIMS -MADE ESA56427935 01/0112017 01101/2018 EACH OCCURRENCE $ 1,000,000 X AGGREGATE $ 1'000'000 DED RETENTION $ C WORKERS COMPENSATION AND EMPLOYERS' LIABILITY YIN ANY PROPRIETOR/PARTNER/EXECUTIVE FFICER/MEMBER EXCLUDED? Mandatory In NH) If es, descnbe under DESCRIPTION OF OPERATIONS below N/A TWC3625060 04110/2017 04/10/2018 X PER OTH- TA T ER E L EACH ACCIDENT 1,000,000 $ E L DISEASE - EA EMPLOYE $ 1'00'000 E L DISEASE - POLICY LIMIT 1,000,000 $ DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) Certificate Holder is named Additional Insured as respects General Liability in accordance with attached form CG8810 0413 City of Gilroy It's officers, officials and employees 7351 Rosanna Street Gilroy, CA 95020 ACORD 25 (2016103) SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. AUTHORIZED REPRESENTATIVE -- ©1988 -2015 ACORD The ACORD_ name and logo are registered marks of ACORD rinhts rPSa I COMMERCIAL GENERAL LIABILITY CG 88 10 04 13 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. COMMERCIAL GENERAL LIABILITY EXTENSION This endorsement modifies insurance provided under the following - COMMERCIAL GENERAL LIABILITY COVERAGE PART INDEX SUBJECT PAGE NON -OWNED AIRCRAFT 2 NON -OWNED WATERCRAFT 2 PROPERTY DAMAGE LIABILITY -ELEVATORS 2 EXTENDED DAMAGE TO PROPERTY RENTED TO YOU (Tenant's Property Damage) 2 MEDICAL PAYMENTS EXTENSION 3 EXTENSION OF SUPPLEMENTARY PAYMENTS -COVERAGES A AND B 3 ADDITIONAL INSUREDS -BY CONTRACT, AGREEMENT OR PERMIT 3 PRIMARY AND NON - CONTRIBUTORY- ADDITIONAL INSURED EXTENSION 5 ADDITIONAL INSUREDS - EXTENDED PROTECTION OF YOUR "LIMITS OF INSURANCE" 6 WHO IS AN INSURED - INCIDENTAL MEDICAL ERRORS /MALPRACTICE AND WHO IS AN INSURED - FELLOW EMPLOYEE EXTENSION - MANAGEMENT EMPLOYEES 6 NEWLY FORMED OR ADDITIONALLY ACQUIRED ENTITIES 7 FAILURE TO DISCLOSE HAZARDS AND PRIOR OCCURRENCES 7 KNOWLEDGE OF OCCURRENCE, OFFENSE, CLAIM OR SUIT 7 LIBERALIZATION CLAUSE 7 BODILY INJURY REDEFINED 7 EXTENDED PROPERTY DAMAGE 8 WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US - 8 WHEN REQUIRED IN A CONTRACT OR AGREEMENT WITH YOU © 2013 Liberty Mutual Insurance CG 88 10 04 13 Includes copyrighted material of Insurance Services Office, Inc.; with its permission. 7 Page 1 of 8- - With respect to coverage afforded by this endorsement, the provisions of the policy apply unless modified by the endorsement. NON -OWNED AIRCRAFT Under Paragraph 2. Exclusions of Section I - Coverage A - Bodily Injury And Property Damage Liability, exclusion g. Aircraft, Auto Or Watercraft does not apply to an aircraft provided: 1. It is not owned by any insured; 2. It is hired, chartered or loaned with a trained paid crew; 3. The pilot in command holds a currently effective certificate, issued by the duly constituted authority of the United States of America or Canada, designating her or him a commercial or airline pilot; and 4. It is not being used to carry persons or property for a charge. However, the insurance afforded by this provision does not apply if there is available to the insured other valid and collectible insurance, whether primary, excess (other than insurance written to apply specifically in excess of this policy), contingent or on any other basis, that would also apply to the loss covered under this provision. NON -OWNED WATERCRAFT Under Paragraph 2. Exclusions of Section I - Coverage A - Bodily Injury And Property Damage Liability, Subparagraph (2) of exclusion g. Aircraft, Auto Or Watercraft is replaced by the following: This exclusion does not apply to: (2) A watercraft you do not own that is. (a) Less than 52 feet long, and (b) Not being used to carry persons or property for a charge. N C. PROPERTY DAMAGE LIABILITY -ELEVATORS 1. Under Paragraph 2. Exclusions of Section I - Coverage A - Bodily Injury And Property Damage Liabil- ity, Subparagraphs (3), (4) and (6) of exclusion j. Damage To Property do not apply if such "property damage" results from the use of elevators. For the purpose of this provision, elevators do not include vehicle lifts. Vehicle lifts are lifts or hoists used in automobile service or repair operations. 2. The following is added to Section IV - Commercial General Liability Conditions, Condition 4. Other Insurance, Paragraph b. Excess Insurance: The insurance afforded by this provision of this endorsement is excess over any property insurance, whether primary, excess, contingent or on any other basis. D. EXTENDED DAMAGE TO PROPERTY RENTED TO YOU (Tenant's Property Damage) If Damage To Premises Rented To You is not otherwise excluded from this Coverage Part: 0 1. Under Paragraph 2. Exclusions of Section I - Coverage A - Bodily Injury and Property Damage Liability: a. The fourth from the last paragraph of exclusion j. Damage To Property is replaced by the follow - ing. Paragraphs (1), (3) and (4) of this exclusion do not apply to "property damage" (other than damage by fire, lightning, explosion, smoke, or leakage from an automatic fire protection system) to: (i) Premises rented to you for a period of 7 or fewer consecutive days, or (ii) Contents that you rent or lease as part of a premises rental or lease agreement for a period of more than 7 days. Paragraphs (1), (3) and (4) of this exclusion do not apply to "property damage" to contents ui premises rented to you for a period of 7 or fewer consecutive days. A separate limit of insurance applies to this coverage as described in Section III - Limits of Insurance. © 2013 Liberty Mutual Insurance CG 88 10 04 13 Includes copyrighted material of Insurance Services office, Inc , with its permission Page 2 of 8 b. The last paragraph of subsection 2. Exclusions is replaced by the following: Exclusions c. through n. do not apply to damage by fire, lightning, explosion, smoke or leakage from automatic fire protection systems to premises while rented to you or temporarily occupied by you with permission of the owner. A separate limit of insurance applies to Damage To Premises Rented To You as described in Section III - Limits Of Insurance. 2. Paragraph 6. under Section III - Limits Of Insurance is replaced by the following: 6. Subject to Paragraph 5. above, the Damage To Premises Rented To You Limit is the most we will pay under Coverage A for damages because of "property damage" to: a. Any one premise (1) While rented to you; or (2) While rented to you or temporarily occupied by you with permission of the owner for damage by fire, lightning, explosion, smoke or leakage from automatic protection sys- tems; or b. Contents that you rent or lease as part of a premises rental or lease agreement. 3. As regards coverage provided by this provision D. EXTENDED DAMAGE TO PROPERTY RENTED TO YOU (Tenant's Property Damage) - Paragraph 9.a. of Definitions is replaced with the following: 9.a. A contract for a lease of premises. However, that portion of the contract for a lease of premises that indemnifies any person or organization for damage by fire, lightning, explosion, smoke, or leakage from automatic fire protection systems to premises while rented to you or temporarily occupied by you with the permission of the owner, or for damage to contents of such premises that are included in your premises rental or lease agreement, is not an "insured contract ". E. MEDICAL PAYMENTS EXTENSION If Coverage C Medical Payments is not otherwise excluded, the Medical Payments provided by this policy are amended as follows: Under Paragraph 1. Insuring Agreement of Section I - Coverage C - Medical Payments, Subparagraph (b) of Paragraph a. is replaced by the following (b) The expenses are incurred and reported within three years of the date of the accident; and F. EXTENSION- OF SUPPLEMENTARY PAYMENTS - COVERAGES A AND B 1. Under Supplementary Payments - Coverages A and B, Paragraph 1.b. is replaced by the following: b. Up to $3,000 for cost of bail bonds required because of accidents or traffic law violations arising out of the use of any vehicle to which the Bodily Injury Liability Coverage applies. We do not have to furnish these bonds. 2. Paragraph 1.d. is replaced by the following. d. All reasonable expenses incurred by the insured at our request to assist us in the investigation or defense of the claim or "suit ", including actual loss of earnings up to $500 a day because of time off from work G. ADDITIONAL INSUREDS -BY CONTRACT, AGREEMENT OR PERMIT 1. Paragraph 2. under Section If - Who Is An Insured is amended to include as an insured any person or organization whom you have agreed to add as an additional insured in a written contract, written agreement or permit. Such person or organization is an additional insured but only with respect to liability for "bodily injury", "property damage" or "personal and advertising injury" caused in whole or in part by: a. Your acts or omissions, or the acts or omissions of those acting on your behalf, in the performance of your on going operations for the additional insured that are the subject of the written contract or written agreement provided that the "bodily injury" or "property damage" occurs, or the "per- sonal and advertising injury" is committed, subsequent to the signing of such written contract or written agreement; or 2013 Liberty Mutual Insurance CG 88 10 04 13 Includes copyrighted material of Insurance Services Office, Inc , with its permission Page 3 of 8 b. Premises or facilities rented by you or used by you; or c. The maintenance, operation or use by you of equipment rented or leased to you by such person or organization, or d. Operations performed by you or on your behalf for which the state or political subdivision has issued a permit subject to the following additional provisions: (1) This insurance does not apply to "bodily injury", "property damage ", or "personal and ad- vertising injury" arising out of the operations performed for the state or political subdivision; (2) This insurance does not apply to "bodily injury" or "property damage" included within the "completed operations hazard ". (3) Insurance applies to premises you own, rent, or control but only with respect to the following hazards - (a) The existence, maintenance, repair, construction, erection, or removal of advertising —' signs, awnings, canopies, cellar entrances, coal holes, driveways, manholes, marquees, hoist away openings, sidewalk vaults, street banners, or decorations and similar expo- sures; or (b) The construction, erection, or removal of elevators; or (c) The ownership, maintenance, or use of any elevators covered by this insurance. However: 1. The insurance afforded to such additional insured only applies to the extent permitted by law; and 2. If coverage provided to the additional insured is required by a contract or agreement, the insur- ance afforded to such additional insured will not be broader than that which you are required by the contract or agreement to provide for such additional insured. N With respect to Paragraph 1.a. above, a person's or organization's status as an additional insured under this endorsement ends when. (1) All work, including materials, parts or equipment furnished in connection with such work, on the project (other than service, maintenance or repairs) to be performed by or on behalf of the additional insured(s) at the location of the covered operations has been completed; or (2) That portion of "your work" out of which the injury or damage arises has been put to its intended use by any person or organization other than another contractor or subcontractor engaged in performing operations for a principal as a part of the same project. With respect to Paragraph 1.b. above, a person's or organization's status as an additional insured under this endorsement ends when their written contract or written agreement with you for such premises or facilities ends. aWith respects to Paragraph 1.c. above, this insurance does not apply to any "occurrence" which takes place after the equipment rental or lease agreement has expired or you have returned such equipment to the lessor. The insurance provided by this endorsement applies only if the written contract or written agreement is signed prior to the "bodily injury" or "property damage ". We have no duty to defend an additional insured under this endorsement until we receive written notice of a 'suit' by the additional insured as required in Paragraph b. of Condition 2. Duties In the Event Of Occurrence, Offense, Claim Or Suit under Section IV - Commercial General Liability Condi- tions. 2013 Liberty Mutual Insurance CG 88 -10 0413 Includes copyrighted material of Insurance Services Office, Inc., with its permission. _ _Page_ 4 of 8 2. With respect to the insurance provided by this endorsement, the following are added to Paragraph 2. Exclusions under Section I - Coverage A - Bodily Injury And Property Damage Liability: This insurance does not apply to: a. "Bodily injury" or "property damage" arising from the sole negligence of the additional insured. b. "Bodily injury" or "property damage" that occurs prior to you commencing operations at the location where such "bodily injury" or "property damage" occurs. c. "Bodily injury", "property damage" or "personal and advertising injury" arising out of the render- ing of, or the failure to render, any professional architectural, engineering or surveying services, including (1) The preparing, approving, or fading to prepare or approve, maps, shop drawings, opinions, reports, surveys, field orders, change orders or drawings and specifications; or (2) Supervisory, inspection, architectural or engineering activities. This exclusion applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, if the "occur- rence" which caused the "bodily injury" or "property damage ", or the offense which caused the "personal and advertising injury", involved the rendering of, or the failure to render, any professional architectural, engineering or surveying services. d. "Bodily injury" or "property damage" occurring after: (1) All work, including materials, parts or equipment furnished in connection with such work, on the project (other than service, maintenance or repairs) to be performed by or on behalf of the additional insured(s) at the location of the covered operations has been completed, or (2) That portion of "your work" out of which the injury or damage arises has been put to its intended use by any person or organization other than another contractor or subcontractor engaged in performing operations for a principal as a part of the same project. e. Any person or organization specifically designated as an additional insured for ongoing operations by a separate ADDITIONAL INSURED - OWNERS, LESSEES OR CONTRACTORS endorsement is- sued by us and made a part of this policy. 3. With respect to the insurance afforded to these additional insureds, the following is added to Section III - Limits Of Insurance: If coverage provided to the additional insured is required by a contract or agreement, the most we will pay on behalf of the additional insured is the amount of insurance: a. Required by the contract or agreement; or b. Available under the applicable Limits of Insurance shown in the Declarations, whichever is less. This endorsement shall not increase the applicable Limits of Insurance shown in the Declaratio ns. H. PRIMARY AND NON - CONTRIBUTORY ADDITIONAL INSURED EXTENSION This provision applies to any person or organization who qualifies as an additional insured under any form ° or endorsement under this policy Condition 4. Other Insurance of SECTION IV - COMMERCIAL GENERAL LIABILITY CONDITIONS is amend- ed as follows: a. The following is added to Paragraph a. Primary Insurance: If an additional insured's policy has an Other Insurance provision making its policy excess, and you have agreed in a written contract or written agreement to provide the additional insured coverage on a primary and noncontributory basis, this policy shall be primary and we will not seek contribution from the additional insured's policy for damages we cover. © 2013 Liberty Mutual Insurance CG 88-10 04-13 Includes copyrighted material of Insurance Services Office ; Inc ,-with - its permission Page-5-of -8 -- - - -- b. The following is added to Paragraph b. Excess Insurance: When a written contract or written agreement, other than a premises lease, facilities rental contract or agreement, an equipment rental or lease contract or agreement, or permit issued by a state or political subdivision between you and an additional insured does not require this insurance to be primary or primary and non - contributory, this insurance is excess over any other insurance for which the addi- tional insured is designated as a Named Insured. Regardless of the written agreement between you and an additional insured, this insurance is excess over any other insurance whether primary, excess, contingent or on any other basis for which the additional insured has been added as an additional insured on other policies. I. ADDITIONAL INSUREDS - EXTENDED PROTECTION OF YOUR "LIMITS OF INSURANCE" This provision applies to any person or organization who qualifies as an additional insured under any form Q or endorsement under this policy. 1. The following is added to Condition 2. Duties In The Event Of Occurrence, Offense, Claim or Suit: An additional insured under this endorsement will as soon as practicable: a. Give written notice of an "occurrence" or an offense that may result in a claim or "suit" under this insurance to us; s b. Tender the defense and indemnity of any claim or "suit" to all insurers whom also have insurance available to the additional insured; and c. Agree to make available any other insurance which the additional insured has for a loss we cover under this Coverage Part. d. We have no duty to defend or indemnify an additional insured under this endorsement until we receive written notice of a "suit" by the additional insured 2. The limits of insurance applicable to the additional insured are those specified in a written contract or written agreement or the limits of insurance as stated in the Declarations of this policy and defined in Section III - Limits of Insurance of this policy, whichever are less. These limits are inclusive of and not in addition to the limits of insurance available under this policy. J. WHO IS AN INSURED -INCIDENTAL MEDICAL ERRORS/ MALPRACTICE WHO IS AN INSURED - FELLOW EMPLOYEE EXTENSION - MANAGEMENT EMPLOYEES Paragraph 2.a.(1) of Section II - Who Is An Insured is replaced with the following: (1) "Bodily injury" or "personal and advertising injury": (a) To you, to your partners or members (if you are a partnership or joint venture), to your members (if you are a limited liability company), to a co- "employee" while in the course of his or her employ- ment or performing duties related to the conduct of your business, or to your other "volunteer workers" while performing duties related to the conduct of your business; (b) To the spouse, child, parent, brother or sister of that co- "employee" or "volunteer worker" as a consequence of Paragraph (1) (a) above, (c) For which there is any obligation to share damages with or repay someone else who must pay damages because of the injury described in Paragraphs (1) (a) or (b) above; or (d) Arising out of his or her providing or failing to provide professional health care services. However, if you are not in the business of providing professional health care services or providing profes- sional health care personnel to others, or if coverage for providing professional health care ser- vices is not otherwise excluded by separate endorsement, this provision (Paragraph (d)) does not apply. Paragraphs (a) and (b) above do not apply to "bodily injury" or "personal and advertising injury" caused by an "employee" who is acting in a supervisory 'capacity for you. Supervisory capacity as used herein means the "employee's" lob responsibilities assigned by you, includes the direct supervision of other "employ- ees" of yours. However, none of these "employees" are insureds for "bodily injury" or "personal and © 2013 Liberty Mutual Insurance ; _...._ CG-88 10 04 13 Includes copyrighted material-of Insurance Services Office; Inc.-,with -its permission Page-6 of 8 - - advertising injury" arising out of their willful conduct, which is defined as the purposeful or willful intent to . cause "bodily injury" or "personal and advertising injury", or caused in whole or in part by their intoxica- tion by liquor or controlled substances. The coverage provided by provision J. is excess over any other valid and collectable insurance available to your "employee ". K. NEWLY FORMED OR ADDITIONALLY ACQUIRED ENTITIES Paragraph 3. of Section II - Who Is An Insured is replaced by the following. 3. Any organization you newly acquire or form and over which you maintain ownership or majority interest, will qualify as a Named Insured if there is no other similar insurance available to that organization. However: a. Coverage under this provision is afforded only until the expiration of the policy period in which the entity was acquired or formed by you, b. Coverage A does not apply to "bodily injury" or "property damage" that occurred before you acquired or formed the organization; and c. Coverage B does not apply to "personal and advertising injury" arising out of an offense committed before you acquired or formed the organization. d. Records and descriptions of operations must be maintained by the first Named Insured No person or organization is an insured with respect to the conduct of any current or past partnership, joint venture or limited liability company that is not shown as a Named Insured in the Declarations or qualifies as an insured under this provision. L. FAILURE TO DISCLOSE HAZARDS AND PRIOR OCCURRENCES Under Section IV -Commercial General Liability Conditions, the following is added to Condition 6. Repre- sentations: Your failure to disclose all hazards or prior 'occurrences" existing as of the inception date of the policy shall not prejudice the coverage afforded by this policy provided such failure to disclose all hazards or prior 'occurrences" is not intentional M. KNOWLEDGE OF OCCURRENCE, OFFENSE, CLAIM OR SUIT Under Section IV - Commercial General Liability Conditions, the following is added to Condition 2. Duties In The Event of Occurrence, Offense, Claim Or Suit: Knowledge of an 'occurrence ", offense, claim or "suit" by an agent, servant or "employee" of any insured shall not in itself constitute knowledge of the insured unless an insured listed under Paragraph 1. of Section 11 - Who Is An Insured or a person who has been designated by them to receive reports of "occurrences ", offenses, claims or "suits" shall have received such notice from the agent, servant or "employee ". N. LIBERALIZATION CLAUSE If we revise this Commercial General Liability Extension Endorsement to provide more coverage without additional premium charge, your policy will automatically provide the coverage as of the day the revision is effective in your state. O. BODILY INJURY REDEFINED Under Section V - Definitions, Definition 3. is replaced by the following: 3. 'Bodily Injury" means physical injury, sickness or disease sustained by a person. This includes mental anguish, mental injury, shock, fright or death that results from such physical injury, sick- ness or disease .2013 Liberty Mutual Insurance = -• CG 88 10 04 13 Includes copyrighted material of Insurance Services Office,'Inc -, with -its permission - — - Page -7 of -8 - _ -- P. EXTENDED PROPERTY DAMAGE ` Exclusion a. of COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY is replaced by the following. a. Expected Or Intended Injury "Bodily injury" or "property damage" expected or intended from the standpoint of the insured. This exclusion does not apply to "bodily injury" or "property damage" resulting from the use of reasonable force to protect persons or property. Q. WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US - WHEN REQUIRED IN A CONTRACT OR AGREEMENT WITH YOU Under Section IV - Commercial General Liability Conditions, the following is added to Condition 8. Trans- fer Of Rights Of Recovery Against Others To Us: ° We waive any right of recovery we may have against a person or organization because of payments we make for injury or damage arising out of your ongoing operations or your work" done under a contract with that person or organization and included in the "products- completed operations hazard" provided - 1. You and that person or organization have agreed in writing in a contract or agreement that you waive such rights against that person or organization; and 2. The injury or damage occurs subsequent to the execution of the written contract or written agree- ment. 2013 Liberty Mutual Insurance - • — I CG-88-10 04-13 Includes copyrighted matenal -of Insurance Services Office; Inc--with-its permission Page 8 of 8- — -- -