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resolution.council.058-20
RESOLUTION NO. 58 Series of 2020 A RESOLUTION OF THE CITY OF ASPEN, COLORADO, APPROVING AN AGREEMENT FOR LEASE AND OPERATION OF THE CHERYL AND SAM WYLY ANIMAL SHELTER BETWEEN THE CITY OF ASPEN AND THE BOARD OF COUNTY COMMISSIONERS OF PITKIN COUNTY, COLORADO AS "LESSORS" AND SACHSON, INC., FOR THE OPERATION OF THE ANIMAL SHELTER ON BEHALF OF THE CITY AND COUNTY AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAID LEASE AGREEMENT ON BEHALF OF THE CITY OF ASPEN. WHEREAS, there has been submitted to the City Council a proposed agreement for lease and operation of the Animal Shelter between the City of Aspen, the Board of County Commissioners of Pitkin County, Colorado, and Sachson, Inc., a Colorado corporation, for the joint commitment to provide continued animal shelter,boarding and animal care services; and WHEREAS, after due deliberation and consideration the City Council has determined that it is in the best interest of the City of Aspen to approve said lease agreement and authorize the City Manager to execute same on behalf of the City of Aspen, if the Lease Agreement is also approved by Board of County Commissioners of Pitkin County. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, that the City Council hereby approves the Agreement for Lease and Operation of the Cheryl and Sam Wyly Animal Shelter attached hereto as Exhibit "A" and does hereby authorize the City Manager to execute said Lease Agreement on behalf of the City of Aspen, conditioned upon the approval of such lease by the Board of County Commissioners of Pitkin County. Dated: e,�/rV� !��r' ..� 52020. Torre,Mayor I, Nicole Henning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado,at a meeting held "X, 2020. Nicole Henning,City Clerk AGREEMENT FOR LEASE AND OPERATION OF THE CHERYL AND SAM WYLY ANIMAL SHELTER THIS LEASE AGREEMENT (this "Lease") is made and entered into on July 1, 2020, by and between (i) the City of Aspen(the "City") and (ii) the Board of County Commissioners of Pitkin County, Colorado (the "County" and together with the City, hereinafter referred to collectively as "Lessors"), and Sachson, Inc., a Colorado Corporation("Lessee"), for operation of the Cheryl and Sam Wyly Animal Shelter("Animal Shelter"). WITNESSETH: WHEREAS, Lessors desire to privatize and contract for the provision of an animal shelter and animal care services; and WHEREAS, Lessee desires to provide animal shelter and animal care services to Lessors upon the terms and conditions as set forth below; and WHEREAS, Lessee has spent a substantial amount of time and money in fundraising activities, directly and indirectly, for the acquisition and development of the Premises (as defined below); and WHEREAS, Lessors desire that Lessee enjoy the benefits of such expenditures of time and money as set forth hereunder. NOW THEREFORE, in consideration of the covenants as contained herein, the Lessors and Lessee agree as follows: ARTICLE I GRANT AND TERM 1.1 Lease Grant. In consideration of the recitals and the mutual covenants herein and the rental to be paid hereunder, Lessors grant to Lessee a lease of the premises located at 101 Animal Shelter Road,Aspen, Colorado 81611 ("Premises'),more particularly illustrated on that diagram attached hereto and incorporated herein as Exhibit A, and subject to utility and other easements in place and of record or reasonably required to service the Premises and subject to all encumbrances of record. The Premises includes the entirety of the Animal Shelter building and property, except for the two rental units located on the Premises, access to such rental units, and parking spaces reserved for the two rental units, which shall be excluded from the Premises. 1.2 Premises Condition. Lessee hereby expressly acknowledges that it will carefully examine the Premises prior to occupancy. Lessee will notify Lessor if the condition of the Premises is satisfactory for all purposes and intended uses hereunder,and if Lessee accepts the same in its then current state and condition. If accepted, Lessee accepts the Premises on the Commencement Date "AS IS," without reliance of any kind on and representations of Lessors with respect thereto, all of which are hereby disclaimed by Lessors. 4811-1024-0957.4 1.3 Base Term. This Lease shall commence at 12:01 a.m. on July 1, 2020 ("Commencement Date") and continue for a period of five (5) years (through June 30, 2025) (the "Initial Term"), unless earlier terminated under the provisions hereof. Upon full execution of this Lease, payment of the $1.00 and required rental amount set forth in Section 2.1(a) below, and compliance with insurance requirements hereof, Lessee shall be allowed possession of the Premises. 1.4 Successive Terms. If Lessee substantially performs and abides by all material provisions and conditions of this Lease, upon expiration of the Initial Term of this Lease, Lessee shall have two (2) consecutive rights of first refusal to renew this Lease for two (2) additional successive terms of five (5) years (each a "Renewal Term" and together with the Initial Term, collectively, the"Term");provided,however, if Lessee does not renew this Lease in writing for a first Renewal Term by exercising the option granted pursuant to this Section, Lessee shall forgo its right of first refusal to lease the Premises for a second Renewal Term. In order to exercise its rights of first refusal to renew this Lease, Lessee shall notify Lessors in writing of its desire to renew this Lease no less than one hundred and twenty(120) days and no more than one hundred and eighty (180) days prior to the expiration of the Term then in effect. 1.5 No Partnership or Joint Venture. Nothing contained in this Lease shall create a partnership or joint venture as between Lessors and Lessee or nor shall this Lease render Lessors in any way responsible for the debts or losses, of Lessee,it being the express intention that the relationship of the parties shall be at all times that of Lessors and Lessee. All moneys payable to Lessors under this Lease, shall be due,payable and collectible as rent, and Lessors shall have all the rights with respect to the collection thereof as are given under the terms and conditions of this Lease or under Colorado law with respect to the payment. 1.6 Condemnation by Public AuthoritX. If during the Term, the whole or part of the Premises, or such portion as will make the Premises unusable for the purpose leased,or the leasehold interest, be condemned by public authority including Lessors, for public use, then this Lease shall cease as of the date of the vesting of title in the Premises in such condemning authority, or when possession of the Premises is given to such authority, whichever event occurs first. In the event of any such condemnation or if the Premises is otherwise rendered unusable by Lessee,then all rental amounts due hereunder shall be equitably prorated to reflect Lessee's inability to utilize the Premises as intended under the Lease, effective as of such date, and any amounts pre-paid by Lessee hereunder shall be promptly returned to Lessee. 1.7 Lessee's Right to Terminate. Lessee may terminate this Lease and be relieved of all obligations hereunder by providing Lessors sixty (60) days written notice of its intent to terminate. Upon receipt of such notice, Lessors may participate in the operations of the Shelter with Lessee to accommodate the transition of Shelter management from Lessee to the Lessors. Lessee shall provide a full accounting of all funds, costs and equipment upon termination. 2 4811-1024-0957.4 ARTICLE II RENT 2.1 Rental Payments. a. Lessee agrees to pay Lessors a fixed rental amount during the Term(the"Rent") in accordance with the following: (i) Rent for the period of July 1, 2020 through June 30, 2021 shall be in the amount of$20,000,which shall be payable in advance to the City upon the full execution of this Lease.No additional rental(or profit sharing)amounts shall be due and payable with respect to such period, including amounts that may otherwise have been due under any prior lease; (ii) commencing on July 1, 2021, the annual Rent will increase by the percentage increase in the Denver-Boulder Consumer Price Index ("Index") during the twelve-month period ending on June 30, 2021; and(iii) for each subsequent year thereafter during the Term, the annual amount will be adjusted by the annual percentage increase in the Index during the twelve months ending on June 30. The annual Rent amount will be paid in advance in a single lump sum amount payable to the City by July 1 of each year. b. Should the Index be revised in the future, the parties agree to accept the successor index published or authorized by the US Department of Labor, Bureau of Labor Statistics. C. Should the Index be discontinued, the parties shall meet and confer to determine a mutually acceptable substitute index. d. Lessee acknowledges that all documents provided by Lessee to Lessor in accordance with this Lease may be subject to public inspection pursuant to the Colorado Open Records Act(CORA). ARTICLE III POSSESSION AND USE 3.1 Operation of Business. As and in consideration for the use and occupancy of the Premises and equipment specified hereinabove; Lessee agrees to and shall occupy and use or cause the Premises to be used for the following purposes: a. Animal Shelter and Care Services. Lessee agrees to assume the operational responsibility and management of the Animal Shelter under the terms and conditions as expressed in Exhibit B attached hereto and incorporated herein. b. Private Boarding and Care Services. Lessee shall be permitted to operate a private animal boarding and care service, which may include animal grooming services and a pet shop, utilizing the portion of the Premises as illustrated on Exhibit A attached hereto. Such private boarding care services ("Boarding Services") shall comply with all licensing and animal care standards as set forth under any federal, state or local law and Lessee shall use commercially reasonable efforts to segregate its private Boarding Services from the Animal Shelter services it provides under the terms of this Lease. 3 4811-1024-0957.4 3.2 Payment of Taxes. In the event any taxes are levied and assessed upon the Premises or upon the improvements, fixtures or personal property of Lessee during the Term, or arising therefrom,or upon the leasehold or possessory interests as created through this Lease, Lessee shall be solely responsible to satisfy and pay all such taxes in a timely fashion. 3.3 Compliance with Laws. Lessee shall during the Term, materially comply with, observe and perform all requirements of law and ordinances, including timely payment of sales, withholding,FICA,personal property,workers' compensation and unemployment insurance taxes and payments and shall maintain all required licenses applicable to the Premises or the use thereof, whether now or hereafter made by any governmental authority, will each month during the Term (upon reasonable notice) make available for inspection by Lessors copies of all such tax documentation,and will indemnify Lessors against all losses suffered by Lessors by reason of any suits, actions, claims or damages by whomsoever brought or made, by reason, of the non- compliance, non-observance or nonperformance by Lessee of said laws, ordinance, regulations, orders or required licenses or this covenant. 3.4 Local Laws. Lessee shall have the sole responsibility to obtain all local government regulatory permits or approvals for the occupancy and use of the Premises under this Lease. 3.5 Restrictions on Use. a. Nuisance. Lessee shall not use or permit the use of the Premises in any manner that will create a nuisance or disturb other occupants of the building or properties adjacent thereto; it being understood and acknowledged that the Animal Shelter and Boarding Services contemplated hereunder will necessarily involve a certain level of disturbance for occupants and adjacent properties and that such disturbances will not be deemed a violation of this paragraph. b. Rental Housing Units. Whenever either of the two rental housing units are vacant, they shall be made available first to qualified Animal Shelter employees. If there are no Animal Shelter employees able or willing to rent the rental units, then the units shall be made available to other qualified City/County employees. In each lease with an Animal Shelter employee, the lease agreement shall contain a provision that the lease shall terminate 60 days following termination, for whatever reason, of tenant's employment with the Animal Shelter. Tenants for the two rental units shall be qualified through the Aspen/Pitkin County Housing Authority guidelines. Lessors shall be responsible for all rental unit leases and shall receive all revenues generated from all such leases. Lessee herein shall not be responsible for any utility or maintenance costs associated with the two rental units. C. Hazardous Materials. Lessee covenants and agrees not to suffer, permit, introduce, or maintain any substances or materials which are considered, at any time during the Term, to be hazardous or toxic under any federal, state or local laws, rules, or regulations. Lessee shall indemnify,defend and hold Lessors harmless against any and all loss cost or damages of any nature whatsoever (including without limitation costs and attorney and professional fees) arising out of the introduction of any hazardous materials on or to the building or the Premises by or on behalf of Lessee, its contractors, agents,or employees, including,without limitation,the cost or removing such hazardous materials. 4 4811-1024-0957.4 d. Trash. All garbage and refuse shall be kept in closed containers,which do not emit odors as specified by Lessors and shall be placed outside of the Premises, prepared for collection in the manner and at the times and places specified by Lessors. e. Temperature. Lessee shall always keep the Premises at a temperature compatible with comfortable occupancy during business hours and sufficiently high to prevent freezing of water pipes or fixtures. The plumbing facilities and systems of the building shall not be used for any purpose other than that for which they are constructed, and no foreign substance of any kind shall be thrown into the sewer system. f. Utilities. Lessee will not overload or abuse the electrical wiring,plumbing, floors, walls or structures serving the building and will install, at Lessee's expense, any additional electrical wiring which may be required in connection with any of Lessee's uses, improvements or fixtures. Lessors may have an electrical engineer analyze the Lessee's loads on the system and adequacy of service and if found deficient may give Lessee notice to upgrade the service. Lessee shall comply with such notice within ten days. Lessee will not allow water to leak onto or through floors or walls. Lessee further agrees that Lessee will not install or use any equipment or fixture which will exceed or overload the capacity of any utility system, and if any equipment or fixture installed by Lessee shall require additional utility facilities, the same shall be installed and maintained at Lessee's expense in accordance with plans and specifications which shall be approved by Lessors in writing before installation. g. Clean Condition and Maintenance. Lessee agrees to maintain the Premises in substantially the manner set forth in the Municipal Animal Shelter and Care Services Policies and Procedures Manual attached to this Lease as Exhibit B. The Premises and every part thereof shall be kept by Lessee in a reasonably neat, orderly and clean condition. Lessee shall take no action, which would jeopardize Lessors' title to the Premises or jeopardize the value of the Premises or the building. h. Antennae. No communications antennae or dish shall be erected on the roof or outside of the Premises without first obtaining Lessors' written consent. i. Sign. Lessee may maintain one acceptable sign on the Premises, which conforms to requirements of any applicable County zoning and building codes. Lessors acknowledge that the signage existing on the Premises as of the Commencement Date is acceptable and complies with current codes. j. Lighting. Lessee shall not install in, on,or about the Premises any exterior lighting or use in, on or about the Premises any advertising medium or other device which may be heard or experienced outside the Premises, including but not limited to flashing lights, flashlights, loud speakers, tapes, cd's or phonograph records or radio broadcasts awnings, or any change to the exterior of the building without first having obtained Lessors' written consent. k. Surfaces and Walls. Lessee shall not deface, gouge, mark, paint, stain, drill or otherwise alter the surface and walls inside or outside of the Premises or any of the support 5 4811-1024-0957.4 columns without the prior specific written approval of Lessors. Lessee shall repair any damage to the surfaces or support columns caused by Lessee. 1. Record Keeping. During the Term, Lessee shall keep accurate records of all its operations. Lessee shall maintain records,whether in hard copy or soft copy format, relating to its operations for at least 36 months from the end of each year to which such documents apply. ARTICLE IV CONSTRUCTION-ALTERATIONS-REPAIRS 4.1 Alteration at Lessee's Expense. Following the inspection of Premises by Lessee that is to its reasonable satisfaction, Lessee agrees to accept the property in its present condition, as is, without calling upon Lessors to make any other expenditures or to perform any work for the preparation of the Premises for Lessee's use; provided that it will be delivered clean with the existing plumbing, heating and electrical systems functioning and in good repair. Lessee shall, at its own cost and expense,make any necessary alterations and installations in the Premises required for Lessee's business, using a contractor or contractors who shall have been approved in writing by Lessors, which approval shall not be unreasonably withheld. 4.2 Preconditions. Prior to commencing any work or installing any fixtures or equipment, Lessee shall comply with the following preconditions: a. Approval of Plans. Lessee shall submit the plans and specifications for such alterations to Lessors for written approval. Such approval will not be unreasonably withheld and the request for approval shall be responded to within five business days after receipt by Lessors of such plans. All work to be done by Lessee shall be performed in a workmanlike manner in strict accordance with the approved plans and specifications without any deviation therefrom, unless such deviation is also first approved in writing by Lessors. In the event of any construction which is a material deviation from any approved plans in violation hereof, Lessors shall have the right to demand construction be immediately stopped, and, if construction continues 24 hours after such notice, Lessors may dispossess Lessee, lock and secure the Premises and cause all work to cease until there is compliance with this provision. b. Permits. Lessee shall obtain (and Lessors shall provide reasonable assistance in obtaining) the necessary consents, authorizations and licenses from federal, state and municipal authorities having jurisdiction over the work to be done; and no work shall be started of equipment installed unless and until all such necessary consents, authorizations and licenses shall have first been duly obtained by the Lessee or its contractor or other persons doing the work or installing the equipment on behalf of Lessee. Lessee shall reimburse Lessors for any expenses incurred on account of the failure by Lessee to comply with any such requirements; and any expenses so incurred by Lessors as aforesaid shall be deemed additional Rent under this Lease and due and payable by Lessee to Lessors on the first day of the month immediately following the payment of the same by Lessors. 6 4811-1024-0957.4 C. Contract—Cop, to Lessors. Lessee shall enter into contracts with contractors and persons who will do the work and install the equipment referred to, which contract will provide that the work shall be done in a good workmanlike manner in accordance with the approved plans and specifications and permits and licenses previously obtained and which contract shall provide that the contractor or other persons above referred to will look solely to Lessee for payment and will hold Lessors and the property free from all liens and claims of all persons furnishing labor or materials therefor, or both, and will also require that similar waivers for the right to file liens shall be obtained from subcontractors or material men. A copy of the contract and evidence of its recording with the county clerk together with a duly executed waiver of the right to file liens executed by the contractor or other persons above referred to shall be furnished to Lessors prior to beginning work. d. Insurance—Copy to Lessors. Lessee or any contractor of subcontractors employed by Lessee or any other persons who will do the work or install the equipment as aforesaid, shall be fully covered by general liability insurance and workers' compensation insurance, and a copy of the certificate thereof shall be furnished to Lessors before commencement of any work by any such contractor or persons as aforesaid. Lessee covenants and agrees to indemnify and hold Lessors harmless from any and all claims for personal injury,death or property damage occasioned during the progress or as a result of any or all of the work done as aforesaid in or about the Premises or the building. 4.3 Mechanics Lien: Notice. Lessee shall keep the Premises and the building free and clear of all mechanics,material men's and other liens on account of work done for Lessee. Lessee shall indemnify Lessors against liability, loss, damage, costs or expenses, including attorney fees, on account of claims of lien of laborers or material men or others for work performed for or materials or supplies furnished to Lessee. If Lessee shall desire to contest any claim or lien, Lessee shall furnish to Lessors security of a cash deposit from Lessee of 20% of the amount of the claim, plus estimated costs and interest, conditioned on the discharge of the lien or a corporate surety bond meeting requirements of the applicable statutes sufficient to discharge any lien. If a final judgement establishing the validity of a lien is entered, Lessee shall pay and satisfy the same at once. If Lessee shall be in default in paying any charge for which a mechanic's lien claim or suit to foreclose the lien has been recorded or filed and shall not have given Lessors security as aforesaid, Lessors may(but without being required to do so) pay said lien or claim and any costs, and the amount so paid,together with reasonable attorney fees and costs and expenses incurred by Lessors in connection therewith shall be immediately due and owing from Lessee to Lessors with interest in the rate of 5% per annum from the dates of Lessors' payments. Should any claims of lien be filed against the Premises or the building or any action affecting the title thereto be commenced,Lessee shall give Lessors written notice thereof as soon as possible. During any such work, Lessors shall have the right to post and keep posted upon the premises notices that Lessors' interest in the Premises should not be subject to any lien for such work done. Lessors hereby designate Lessee as its agent for the sole purpose of posting in a conspicuous place upon the Premises a notice containing the following language which Lessee shall be required to post prior to commencement of work: 7 4811-1024-0957.4 Notice. The interest of Lessors of these premises, the City of Aspen and the Board of County Commissioners of Pitkin County, and the building and lands upon which it is situated shall not be subject to an lien for work done or materials or equipment supplied by any contractor or other person for Lessee's improvements pursuant to this Notice and §38-22 105(2), C.R.S. 4.4 Lessee to Compensate Lessors for Insurance Increase. Lessee shall pay upon demand as additional rent hereunder any increase in Lessors' insurance premium, which results solely and directly on account of Lessors' endorsements covering the risk during work or upon completion of such alterations or improvements or as a result of subsequent use of the premises by Lessee. 4.5 Lessee's Maintenance and Repair Obligation. Lessee agrees, during the Term, and at Lessee's expense, to maintain the interior of the premises in good condition and promptly and diligently repair any damage to every part thereof including walls, partitions, doors, door jambs, closets, door hardware, fixtures, glass, floors, ceilings, railings, banisters, plumbing lines and fixtures, electric lines and fixtures, gas lines and fixtures, heating and any other items and services associated with the Premises,with the exception of wear and tear and aging consistent with normal animal shelter and boarding kennel use,and except such damage as is attributable to the negligence or the act or omission of Lessors, to promptly and diligently repair any damage to other premises in the building attributable to the negligence of the act or omission of Lessee, or Lessee's employees, guests, or invitees,to maintain and promptly and diligently repair, improve or remodel the interior of the Premises to meet requirements of any governmental authority having jurisdiction thereof, and maintain in good condition and promptly and diligently repair and damage to (or replace if necessary in the circumstances)any trade fixtures installed in or attached to the Premises. Lessee shall also be responsible for maintenance of grounds and landscaping as well as the parking lots. Lessors will be responsible for snowplowing. a. In the event of default by Lessee for failure to perform Lessee's repair and maintenance obligations, Lessors shall have the right,but not the obligation,to perform such work as Lessors deem necessary, and all such costs shall be payable to Lessee on demand as additional Rent hereunder due on the first day of the following month. Lessors shall have no responsibility for damage caused through defects or malfunctions of equipment operated by another Lessee. Lessee agrees to make repairs or compensate any other Lessee or Lessors for damages caused such Lessee by the negligence or act or omission of Lessee or Lessee's employees. b. Lessor reserves the right, from time to time, at its own expense and by its officials, employees and contractors, to make such alterations, renovations or repairs in and about the Premises, other than those noted above as required by Lessee. Lessee shall make no claim against Lessors'for any interference with its interest as herein provided in the Premises. Lessors shall provide reasonable notice to Lessee in advance of any intent to undertake alterations or repairs as authorized in this paragraph and all work shall be performed at such time as mutually agreed to between the parties so as to eliminate or minimize any disruption of Lessee's business and Animal Shelter operations. 8 4811-1024-0957.4 4.6 Lessors' Repair Obligation. a. With respect to Lessors' repair obligations hereunder,if the damage to the Premises or the building, as the case may be, is covered by standard fire and extended coverage insurance and exceeds 50% of the then replacement cost of the Premises or the building, as the case may be (excluding foundation and excavation costs), or if the damage to the Premises or the building is not covered by such insurance or if the damage is such that the Premises or building, as the case may be, cannot reasonably be repaired or reconstructed within a period of 90 days, Lessors may (but without any obligation to do so) elect to repair or reconstruct the same, in which event this Lease shall continue in full force and effect, or Lessors may elect not to repair or reconstruct the same, in which event this Lease shall terminate. In any such event, Lessors shall give written notice to Lessee of Lessors' intention within 60 days from the date of destruction; and, if Lessors shall elect to repair or reconstruct the Premises or the building, as the case may be, Lessors shall exercise diligence in commencing the work and in prosecuting the same to completion. Lessee shall not be entitled to damages from Lessors in the event of damage or destruction of the Premises or said building, by reason of leaking of any water or sewer pipes, or neglect of other Lessees, or water coming through the ceiling, or gas or electrical problems or for interruption of services or any inconvenience or loss of business or property sustained by Lessee unless such loss is attributable to the negligence or the intentional net or omission of Lessors. b. Lessee's Rent obligation hereunder shall abate during any period Lessors' repair obligation exists and when the Premises are so damaged as to be unusable by Lessee, unless the damage was caused by Lessee or Lessee's employees, agents, guests or invitees, in which case the rental obligation shall continue. 4.7 Climate Change and Conservation Measures. a. Lessors and Lessee agree to work in good faith to align operations of the Animal Shelter with the City and County climate action goals. Lessee will consider opportunities to incorporate resiliency goals into the Best Management Practices for operating the Animal Shelter. b. Lessors and Lessee agree to jointly conduct an energy assessment of the Animal Shelter to determine feasibility of replacing fossil fuel-based energy with renewable energy sources. C. Lessors and Lessee shall seek opportunities to make capital improvements in the Premises that will improve the carbon footprint of the Animal Shelter. ARTICLE V TRADE FIXTURES 5.1 Lessors' Furniture,Fixtures and Equipment(FF&E). Lessors are the owners of all attached furniture,fixtures and equipment("FF&E")on the Premises as of the Commencement Date.These FF&E are and shall remain the property of Lessors.Lessee covenants it will maintain,repair and/or replace(with items of equal or better quality)any of such FF&E so that, at the expiration or earlier termination of this Lease, Lessee shall return to Lessors all FF&E which are part of the initial 9 4811-1024-0957.4 inventory or qualifying replacements in good condition, subject to normal wear and tear. Lessee shall furnish Lessor a list of building contents annually by January 15 of each calendar year and updated whenever additional FF&E is added by Lessors. 5.2 No Warranties by Lessors. Lessors not being the manufacturer of the FF&E or manufacturer's agent,MAKES NO WARRANTY OR REPRESENTATION,EITHER EXPRESS OR IMPLIED, WITH RESPECT TO, AMONG OTHER THINGS, FITNESS, QUALITY DESIGN, CONDITIOIN, CAPACITY, SUITABILITY, MERCHANTABILITY, OR PERFORMANCE OF THE FF&E OR OF THE MATERIAL OR WORKMANSHIP THEREOF, IT BEIND AGREED THAT THE FF&E IS LEASED,"AS IS"AND THAT ALL SUCH RISKS, AS BETWEEN LESSORS AND LESSEE, ARE TO BE BORNE BY LESSEE AT ITS SOLE RISK. Lessors shall not be liable to Lessee for any liability, loss or damage caused or alleged to be caused directly or indirectly by the FF&E, by any inadequacy of or defect therein or by any incident in connection therewith, Lessee, accordingly, agrees not to assert any claim whatsoever against Lessors based thereon. Lessee further agrees, regardless of cause, not to assert any claim whatsoever against Lessors for loss of anticipatory profits of consequential damages: No oral agreement, guarantee, promise, condition, representation, or warranty shall be binding. 5.3 Surrender of Premises: Treatment of Lessee's Alterations at Expiration or Termination of Lease. Upon termination of this Lease or termination of Lessee's possession rights in the leased Premises, Lessee shall promptly deliver possession thereof to Lessors. All alterations, additions, improvements, partitions, flooring, carpeting, plumbing fixtures, shelving and other fixtures (excepting Lessee's trade fixtures which can be removed without material damage to the leased Premises, which shall remain the property of Lessee provided Lessee completely repairs such damage),which may be made or installed by Lessee upon the Premises during the Term and which in any manner, are attached to the floors, walls, windows, or ceilings, shall become the property of the Lessors upon the expiration or other termination of this Lease or of Lessee's possessory rights hereunder. In all material respects, Lessee shall return the Premises to Lessors in its original condition existing at the Commencement Date. Lessee agrees to return the Premises to substantially the same office configuration (walls, partitions, doors, etc.) as when delivered to Lessee at the Commencement Date. Lessee agrees to perform the work to return the Premises to the configuration employing professional contractor services, and to perform the work prior to the termination of the Lease. Lessors shall notify Lessee sixty(60) days prior to the expiration of the Lease for enforcement of waiver of this provision. ARTICLE VI INSURANCE 6.1 Liability and Comprehensive Insurance. Lessee shall maintain comprehensive all risks casualty, public liability and property damage insurance (at replacement values) with responsible insurance companies licensed to conduct business in Colorado and acceptable to Lessors which will insure Lessors and Lessee against liability for bodily injury, loss of life, or other injury, with limitations in amounts deemed reasonable by Lessors, and shall name Lessors and, at Lessors' option, Lessors' mortgagee as an additional insured with respect to each such policy. The amount of this insurance, without co-insurance clauses, shall not be less than the maximum liability that can be imposed upon the City of Aspen and the Board of County Commissioners of Pitkin County 10 4811-1024-0957.4 under the laws of the State of Colorado found at C.R.S. § 24-10-101, et, seq., as amended. At present, such amounts shall be as follows: • $350,000.00 for any injury to one person in any single occurrence. • $990,000.00 for any injury to two or more persons in any single occurrence. In no event shall such insurance amounts fall below those maximum liability limits as set for the at C.R.S. §24-10-114, as amended. Copies of such policies shall be promptly delivered to Lessors upon issuance thereof, and, as often as any such policies shall expire or terminate,renewal or additional policies shall be procured and maintained by Lessee and copies promptly furnished to Lessors. Lessee shall name Lessor as co- insured or additional insured on all insurance policies and such policies shall provide for a ten-day advance written notice to Lessors in the event of cancellation or material change in coverage or 20 days advance notice of cancellation for nonpayment. To the maximum extent permitted by the insurance policies owned by Lessors and Lessee, the parties hereto for their mutual benefit waive any and all rights of subrogation, which might otherwise exist. If Lessee fails to comply with this paragraph, Lessors shall have the right to obtain the said insurance and pay the premiums therefor; and in such event, the entire amount of such premium shall be immediately paid by Lessee to Lessors upon demand and as additional Rent hereunder. 6.2 Indemnification. Lessee agrees to indemnify Lessors against all demands, claims, causes of action, and any expenses (including attorney fees) incurred in resisting such claims, for injury to person, loss of life or damage to property occurring during the Term or any extension thereof and (a) occurring on the Premises and arising out of Lessee's use and occupancy thereof or (b) occurring outside the Premises if caused by the act,omission or neglect of Lessee or the employees, agents, contractors, licensees, or sub-Lessees of Lessee while acting within the course and scope of their employment or engagement with Lessee. 6.3 Fire Insurance. Lessors shall insure the building against fire and other damage to the building for the leased space for replacement value. During the Term and any extension thereof, Lessee shall, at its expense, maintain in full force and effect on all of the trade fixtures, interior furnishing, wall and floor coverings and inventory in the Premises a policy of fire, theft and malicious mischief insurance coverage with standard extended coverage endorsement to the extent of replacement cost value naming Lessors as an additional insured party. Lessee shall provide copies of such policy and any renewals and extensions thereof to Lessors promptly upon issuance. If this Lease is in effect, the proceeds from any such policy shall be used for the repair or replacement of the trade fixtures and inventory so insured. 6.4 Waiver of Subrogation. Anything in this Lease to the contrary notwithstanding, neither Lessors nor Lessee shall be liable to the other for any business interruption or any loss of damage to property occurring on the Premises or the building or in any manner growing out of or connected with Lessee's use and occupation of the building or the condition thereof cause by the negligence or fault of Lessors or Lessee or of their respective agents, employees, sub-Lessees, licensees, or assignees to the extent that such business interruption or loss or damage to property is coverable by a standard all-risk or special form policy(including, at a minimum, fire and extended coverage 11 4811-1024-0957.4 insurance)or a business interruption policy(regardless of whether such insurance is carried or not) or for which such party is otherwise reimbursed;and Lessors and Lessee waive all right of recovery against the other, its agents, employees, sub-Lessees, licensees, and assignees for any such loss or for damage to the property of the waiving party. Each of the parties shall notify its respective insurance carrier that the foregoing waiver is contained in this Lease and shall require such carrier to include an appropriate waiver of subrogation provision in its policies. ARTICLE VII UTILITY SERVICE 7.1 Supplied to Premises. The City shall pay directly to the respective utilities for all water, sewer, trash collection, alarm services, natural gas, and electric services. Lessee shall pay as additional Rent, directly to the City, 82% of the utility bills received from utility companies or entities providing the utility services referenced above.The tenants of the rental housing units shall be responsible for paying the remaining 18% for the above referenced utility services(10%by the tenants of the two-bedroom unit and 8% by the tenant(s) of the one-bedroom unit). Lessee shall pay directly to the respective utility companies in a timely fashion all deposits, connection and service charges for utility services not referenced above (e.g. cable television, and any other utilities used on the Premises from and after the Commencement Date) and shall indemnify Lessors against any liability therefor. Lessee shall be immediately obligated to Lessors to repay such sum as additional Rent hereunder. Lessors may make inquiries to any utility servicing the Premises regarding the status of utility bill obligations. 7.2 Interruption of Services. Lessors shall not be liable to Lessee in damages or otherwise; (i) if any utility shall become unavailable from any public utility company,.public authority, or any other person or entity (including Lessors) supplying or distributing such utility or (ii) for any interruption in any utility service caused by the making of any necessary repairs or by any cause beyond Lessors' reasonable control or enforcement of the provisions of this paragraph, and the same shall not constitute a termination of this Lease or an eviction of Lessee. Lessors shall use reasonable efforts to attempt to schedule any necessary repairs during times when Lessee is not open for business. 7.3 Notice. Lessee agrees to notify promptly the Lessors or its representative of any accidents or defects in the Premises of which Lessee becomes aware, including defects in pipes, electric wiring, and heating or ventilation equipment. In addition, Lessee shall provide Lessors with prompt notification of any matter or condition of the Premises,which may cause injury or damage to the building or any person or property therein. ARTICLE VIII DEFAULTS 8.1 Lessee's Default. Each of the following events shall be deemed an "event of default" or a "default"hereunder if not cured within the time allowed by Paragraph 8.2 hereof: a. Monetary Default. Any breach of or failure to pay Rent due or other monetary amounts due hereunder if not paid within five(5) days of the date due. 12 4811-1024-0957.4 b. Other Obligations. Any failure of Lessee to perform any other material obligation or covenant hereunder. c. Seizure. Seizure of this Lease or the Premises by execution or other process of law against Lessee and not discharged within thirty(30) days. d. Abandonment or Failure to Occupy. Lessee shall vacate(except for temporary closures expressly permitted under the Lease) or abandon the Premises provided that, except as otherwise specifically allowed hereunder, Lessee shall be deemed to have abandoned the Premises, in the event Lessee fails to operate its business therein for five consecutive business days(unless due to causes beyond Lessee's control). Lessee shall fail to take possession of the Premises within thirty (30) days of the receipt of a certificate of occupancy. e. Assignment or Transfer. This Lease or the successor in interest of Lessee hereunder shall be transferred to or shall pass to or devolve upon any other person or party except as expressly consented to by Lessors in the manner herein provided. f. Failure to Pay Deb . Lessee generally fails to pay its debts as they.become due, and such failure continues after notice and a reasonable opportunity to cure. g. Illegal Activity. Lessee shall not at any time, knowingly suffer or knowingly permit any illegal activity on or use of the Premises by Lessee, its sub-Lessees, licensees, agents or employees. 8.2 Rijzht to Cure. Lessee shall have a period of ten (10) business days after written notice is sent from Lessors to cure any failure to pay any Rent or monetary amount due under the Lease. Lessee shall have a period of thirty(30)business days after written notice of the failure to perform or observe any other(non-monetary) term, condition, covenant or agreement of Lessee under this Lease to cure such failure or, if the failure cannot by exercise of reasonable diligence be remedied within thirty (30) business days after written notice of the failure is delivered to Lessee, Lessee fails to commence efforts to cure the failure within thirty(30)business days after written notice of the failure is delivered to Lessee, or if Lessee commences its efforts to cure but thereafter fails to diligently pursue all action reasonably necessary to cure the failure, or if Lessee fails actually to cure the failure in all respects within 45 days following delivery of written notice of the failure to Lessee, Lessee shall be in default. 8.3 Lessors' Rights. Should Lessee at any time be in default in the performance of any of its covenants herein and fail to cure such default within the time periods allowed by Paragraph 8.2 above, Lessee's right to possession of the Premises shall automatically terminate. Upon the termination of Lessee's possessory rights in the leased Premises pursuant to the preceding sentence, the Lessee shall peacefully surrender the Premises to the Lessors. Lessors, at their option, upon the occurrence of any event of default and at any time thereafter while such event of default continues, shall have the right to declare by written notice to Lessee the Term of this Lease ended on the date of such notice or any later date specified therein to take possession of the 13 4811-1024-0957.4 Premises,to exclude Lessee from the Premises,and to remove all persons from the Premises. After Lessors declare the Term ended as provided herein, Lessee shall have no further claim or right to possession of the Premises. 8.4 Remedies, Damages. In the event Lessors terminate Lessee's right to possession of the Premises pursuant to Paragraph 8.3 above Lessors shall be entitled to payment from Lessee, as its sole remedy hereunder, Lessors' direct and reasonable (i) repossession expenses, (ii) broker's commissions, and (iii) repair costs, it being acknowledged that ordinary wear and tear will be excepted. 8.5 Lessors' Lien. To secure the payment of all Rent and other sums of money due and to become due hereunder and the faithful performance of this Lease by Lessee, Lessee hereby grants to Lessors an express first and prior contract lien and security interest on all tangible property belonging to Lessee (including fixtures, equipment, furniture, furnishings, and other chattels, but excluding inventory and merchandise) which may be placed in the Premises and also upon all proceeds of any insurance which may accrue to Lessee by reason of destruction of or damage to any such property. Such property shall not be removed from the Premises by Lessee, its agents or assigns, without the prior written consent of Lessors until all arrearages in Rent and other sums of money then due to Lessors hereunder shall first have been paid. All exemption laws are hereby waived in favor of said lien and security interest. The provisions of this Paragraph shall constitute a security agreement under the Uniform Commercial Code. This lien and security interest are given in addition to any statutory lien to which Lessor is entitled and shall be cumulative thereto upon the occurrence of an event of default. This lien may be foreclosed with or without court proceedings by public or private sale provided Lessors gives Lessee at least ten days' notice of the time and place of said sale; and Lessors shall have the right to become the purchaser, upon being the highest bidder at such sale. 8.6 Property Left on Premises. Any property of Lessee or of anyone claiming under, by or through Lessee which is left on the Premises more than 15 days after expiration of the Term or termination of possessory rights shall be conclusively deemed abandoned; and Lessors may keep, use, remove, store, sell, destroy, discard, or otherwise deal with it in Lessors' absolute discretion without liability of any sort to Lessee or anyone claiming under, by or through Lessee. ARTICLE IX ASSIGNMENT OF SUBLETTING 9.1 Lessors' Consent to Assignment Required. Lessee shall not transfer, assign, sublet, mortgage, encumber, or hypothecate this Lease or Lessee's interest in and to the Premises, or any part thereof without first procuring the written consent of both Lessors, which shall not be unreasonably withheld or delayed (within 45 business days of written request form Lessee). Any assignment or sublet applicant shall be equally or more qualified to perform the obligations of this Lease. Any attempted transfer, without required consent, shall be void and shall constitute a default by Lessee under this Lease. In the event of an approved assignment, such transferee, assignee, sub-lessee or mortgagee shall agree in writing for the benefit of Lessors to assume, to be bonded by and to perform Lessee's obligations under the terms, covenants and conditions of this Lease upon any such assignment. Lessee shall remain liable to Lessors as a principal and not 14 4811-1024-0957.4 merely as a surety for the full performance of the obligations of Lessee hereunder. The granting of a management contract, concession or license to any person, firm or corporation to operate in or use in any manner, any portion of the Premises shall be deemed a subletting. Prohibition on assignment and subletting of this Lease, except as specifically excepted herein, includes a prohibition on any assignment which would otherwise occur by operation of law, merger, consolidation, reorganization, transfer or other change of Lessee's capital structure of ownership, in whole or in part, and to an assignment to or by a receiver or trustee in any federal or state bankruptcy, insolvency, or similar proceeding. 9.2 Subleasing to Businesses within Premises. The Parties hereto acknowledge that Lessee's business plan requires that a certain portion of the Premises may be sublet to businesses that are compatible to the operation of an animal shelter. The parties hereto further acknowledge that Lessee may charge those third-party businesses for rent or for other services rendered by Lessee. Lessee shall obtain the prior written approval of Lessors prior to entering into any sublease with third party businesses to operate within the premises. The approval of Lessors shall not be unreasonably withheld, and Lessors'approval of disapproval shall not be delayed by more than 10 business days. 9.3 No Waiver. Consent by Lessee to any one assignment or sublease shall not constitute a waiver with respect to any further assignments or subleases. Lessors,in approving any assignment or sublease,shall be entitled to consider among other things,the financial capability of the assignee or sub-lessee and compatibility of the proposed use with other uses in the building. If Lessee shall purport in violation hereof to assign this Lease or sublet all or any portion of the Premises or permit any person or persons other than Lessee to occupy the premises, Lessors may collect rent from the person or persons then occupying the Premises and apply the net amount collected to any damages or the rent reserved herein, but no such collection shall be deemed a waiver of this Article or the acceptance by Lessors of such purported assignees or subleases of Lessee or occupant or the release of Lessee of the further performance by Lessee of covenants of Lessee herein, ARTICLE X GENERAL PROVISIONS 10.1 Successors to Lessors. The term "Lessors" herein shall be limited to mean and include only the owner or owners at the time in question of the fee interest in the building; and,in the event of any transfers of the title to such fee, Lessors herein named (and, in the case of any subsequent transfers or conveyances, grantor) shall be automatically freed and relieved, from and after the date of such transfer or conveyance, of all liability as respect the performance of any covenants or obligations on the part of Lessors contained in this Lease thereafter to be performed, provided transferee shall in such assignment agree to assume and perform Lessors' obligations hereunder and provided that any funds in the hands of Lessors or the then grantor at the time of such transfer, in which Lessee has an interest, shall be delivered to the grantee, it being intended hereby that the covenants and obligations contained in this Lease on the part of Lessors shall be binding on Lessors,its successors and assigns,only during and in respect to their respective successive periods of ownership of the fee. 15 4811-1024-0957.4 10.2 Subdivision. Lessors reserve the right, without the consent of the Lessee to execute and record such declarations, restricting covenants, maps or other documents or amendments or supplements thereto for the purpose of subdividing.or re-subdividing the building containing the Premises into separate units and common elements pursuant to the Colorado Common Interest Ownership Act, provided that the Lessor's right as declarant and owner thereof shall be subject and subordinate to the possessory and other rights of the Lessee to the Premises under this Lease. 10.3 Accord and Satisfaction. No payment by Lessee or receipt by Lessors of a lesser amount than the Rent due hereunder shall be deemed to be other than on account of the earliest rent due and payable hereunder. Any endorsement or statement accompanying or inserted upon any check or payment as rent shall not be deemed an accord and satisfaction, and Lessors may accept any such check or payment without prejudice to Lessors' rights to recover the balance of such rent or pursue any other remedy provided in this Lease or at law or in equity. 10.4 Non-Waiver. Failure of Lessors to require strict performance of any covenant or condition shall not be deemed a waiver of such covenant or condition as to that or any subsequent failure. One or more waivers of any breach of any covenant or condition by Lessors shall not be construed as a waiver of a subsequent breach of the same of any other covenant or condition,and the consent or approval by Lessors to or of any act by Lessee requiring Lessors' consent or approval shall not be deemed to waive or render unnecessary Lessors' consent or approval to or of any subsequent similar or dissimilar act by Lessee.The acceptance of rent hereunder by Lessors shall not constitute a waiver of any preceding breach by Lessee of any term, covenant,or condition of this Lease other than the failure of Lessee to pay the particular rental so accepted,regardless of Lessors'knowledge of such preceding breach at the time of acceptance of such rent. No waiver of any provision of this Lease shall be effective unless it is in writing and signed by Lessors. 10.5 Estoppel Certificates. Lessee agrees at any time and from time to time, upon ten days' prior request by Lessors to execute, acknowledge, and deliver to Lessors a statement in writing certifying that this Lease is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating the modifications), and the dates on which the Rent and other charges have been paid in advance, if any, and confirming Lessee's acceptance of the Premises, the Commencement Date, and the Rent provided under the Lease, and any other affirmations or certifications reasonably requested by Lessors with the intent that the statement delivered, may be relied upon by any prospective purchaser, mortgagee, or assignee of any mortgagee of the building or the Premises. 10.6 Attorney Fees. Reasonable costs and attorney fees and other expenses incurred by the Lessors in obtaining legal advice, preparing notices or demands or otherwise enforcing any provision of this Lease by reason of a default by the Lessee or by anyone holding under Lessee in complying with any requirement of this Lease shall be paid by Lessee as additional Rent within three days of notice of the amount thereof. All reasonable attorney fees incurred by the Lessors by reason of any action which Lessors shall institute or be made a party because of this Lease (unless Lessors is joined because of acts of Lessors determined by such litigation to be wrongful) shall be awarded to Lessors. 16 4811-1024-0957.4 10.7 Interest. Without affecting any of Lessors' rights hereunder, any sum provided for herein accruing to Lessors under the provisions of this Lease other than Rent, which shall not be paid when due shall bear interest at the rate of 7%per annum from the date of an event of default until paid in full. 10.8 Recording. Lessee shall not record or permit the recordation of this Lease or any assignment, sublease, license, grant of concession, mortgage or any other document evidencing the transfer or hypothecation of all or any part of this Lease or Lessee's interest in the Premises without in each instance having received the prior written consent of Lessors. Lessors may file or record this Lease or any of the documents related to this Lease or a summary of some of all the provisions hereof at any time without Lessee's consent. 10.9 Notices. Wherever in this Lease it shall be required or permitted that notice or demand be given or served by either party to this Lease on the other, such notice or demand shall be given or served in writing and either personally served at or forwarded by certified mail to the following addresses and shall be deemed effective upon personal service or deposit as certified mail: To Lessors: For City: Aspen City Manager 130 South Galena Street Aspen, Colorado 81611 With a Copy to: James R. True, Esq. City of Aspen Attorney's Office 130 South Galena Street Aspen, Colorado 81611 For County: Pitkin County Manager 530 East Main Street, Suite 302 Aspen, Colorado 81611 With a Copy to: John M. Ely, Esq. Pitkin County Attorney's Office 530 East Main Street, Suite 302 Aspen, Colorado 81611 To Lessee: Sachson Inc. c/o Cheryl and Sam Wyly Animal Shelter 101 Animal Shelter Road Aspen, Colorado 81611 Attn: Seth Sachson With a Copy to: Michael H. Newman, Esq. Foley& Lardner LLP 2021 McKinney Avenue Suite 1600 Dallas, Texas 75201 17 4811-1024-0957.4 Either party may change such address from time opt time by written notice given as herein above provided. 10.10 Additional. In addition to the other remedies in this Lease provided, Lessors shall be entitled to the restraint by injunction of the violation or attempted or threatened violation of any of the covenants, conditions or provisions of this Lease. 10.11 Holding. Any holding over after the expiration of the Term shall be construed to be a tenancy from month-to-month with the fixed monthly rent at 150% of the then current monthly rental rate herein provided for the last month of the then current Term and which tenancy shall otherwise be on the conditions herein specified except that Lessors shall have the right to terminate such tenancy at the end of any calendar month upon ten days' advance written notice. 10.12 Covenant of Quiet Enjoyment. So long as Lessee is not in default or breach hereunder,the Lessors covenants that the Lessee shall peaceably and quietly occupy and enjoy the leased Premises subject to the terms hereof. The Lessors warrants and agrees to defend the title to the Premises and further warrants that they have full authority to execute this Lease. 10.13 Severability. The terms, conditions, covenants, and provisions of this Lease shall be deemed to be severable. If any provision contained herein shall be determined to be invalid by a court of competent jurisdiction or by operation of any applicable law,it shall not affect the validity of any other clause or provision herein. 10.14 Entry by Lessors. Lessors and their authorized agents, employees, attorneys and contractors shall be entitled upon reasonable notice, at all posted business hours (and in emergencies at all times), to enter the Premises to inspect the same or determine compliance herewith and shall have all such rights as may enable Lessors promptly, efficiently and economically to carry on any work or repair, reconstruction, or restoration, to which Lessors are obligated hereunder. Lessee waives any claims for damages for business interference, inconvenience of loss of quiet enjoyment or other loss occasioned by such entry and repaizs unless such repairs were occasioned by the negligence of intentional acts of Lessors. Lessors and their authorized representatives shall have the right to enter the Premises at times other than Lessee's business hours to exhibit the Premises to prospective purchasers, lenders, or Lessees. Lessors agree to provide Lessee with reasonable prior notice, whenever they deem it necessary to enter. Lessee shall always have and retain a key with which to unlock all the doors in, on, or about the Premises. Lessee may not change the locks on the Premises without Lessors' prior written approval; and,upon such approval, Lessors shall be provided a key to any changed locks. Lessors shall have the right to use any and all means, which Lessors may deem proper to open doors in and to the Premises in an emergency in order to obtain entry to the Premises. Any entry to the Premises obtained by Lessors by any means shall not under any circumstances be construed or deemed to be a forcible of unlawful entry into or a detainer of the Premises, or an eviction, actual or constructive of Lessee from the Premises,or any portion thereof,nor shall any such entry entitle Lessee to damages or an abatement of rent or other charges, which this Lease requires Lessee to pay. 18 4811-1024-0957.4 10.15 Binding. This Lease and all agreements herein contained, shall bind the parties hereto. Each term and each provision of this Lease shall be construed as and shall have the same force and effect as though made in the form of a covenant. The parties covenant that the signatory to this Lease has the authority to sign this Lease on behalf of the principal. 10.16 Counterparts. This Lease may be executed in counterparts and with facsimile or emailed or scanned(.pdf) signatures which taken together shall be one document. The parties shall deliver original signed copies within seven days of facsimile, scanned or emailed (.pdf) transmission of their signature. 10.17 Governing Law. This Lease shall be construed in accordance with the laws of the State of Colorado. The parties agree to submit to the personal jurisdiction of the State of Colorado in connection with any action or proceeding relating to this Lease or the Premises. The parties expressly acknowledge and agree that venue of any action shall be in Pitkin County, Colorado. 10.18 Time of Essence. Time is of the essence for all obligations in this Lease. 10.19 Lessee's Authoritv. Lessee shall not be construed as or have any authority to act as the agent of Lessors concerning the Premises. Lessee shall have no authority to surrender; waive, compromise, alter or convey any of Lessors' rights in the Premises. 10.20 Headings. The headings and captions contained in this Lease are inserted for convenience of reference only and are not to be deemed part of, or to be used as an aid in construing,this Lease. 10.21 Survival. All the representations,warranties, and covenants in this Lease shall survive the expiration of termination of this Lease to the extent applicable. 10.22 Entire Agreement. This Lease covers in full each and every agreement of every kind and nature whatsoever between the parties hereto concerning the Premises, and all preliminary negotiations, any prior leases and agreements of whatever kind or nature are merged herein. Lessors have made no representations or promises whatsoever with respect to the Premises and/or the building except those contained herein, and no person, firm or corporation has, at any time, had any authority from Lessors to make any representations or promises on behalf of Lessors; and Lessee expressly agrees that, if any such representations or promises have been made by others, Lessee hereby waive all right to rely thereon. No verbal agreement or implied covenant shall be held to vary the provisions hereof, any statute, law or custom to the contrary notwithstanding. 10.23 Waiver of Jury Trial. Lessors and Lessee waive any right to a trial by a jury of any dispute related to this Lease. 10.24 Force Majeure. In the event that the Lessors or the Lessee shall be delayed or hindered or prevented from the performance of any act required hereunder, by reason of governmental restrictions, scarcity of labor or materials, strikes, pandemics or for other reasons beyond such party's control,the performance of such act shall be excused for the period of delay; and the period. for the performance of any such act shall be extended for the period necessary to compete performance after the end of the period of such delay. 19 4811-1024-0957.4 10.25 Amendment or Modification. Except as otherwise provided herein,this Lease and all these terms and conditions may not be amended or modified absent a written agreement duly executed by the parties. [SIGNATURE PAGES FOLLOW] 20 4811-1024-0957.4 LESSORS: CITY OF ASPEN APPROVED AS TO FORM: By: - .--�_ Print Name: SAr,. &. © 4� James R. True, City Attorney Title: � w r7a .r Date: (p Z 5 h6 24 Dater( cl BOARD OF COUNTY COMMISSIONERS OF PITKIN COUNTY, COLORADO APPROVED AS TO FORM: By: Ste► F. trLu By: '4&. 1 Steven F. Child, Chair John Ely, tounty Attorney Date: jut-14-2020 Date:jul-13-2020 LESSEE: SACHSON,INC. By: 54 Saps.W Seth Sachson, President Datelul-14-2020 Exhibits Attached: Exhibit A—Premises Description Exhibit B—Animal Shelter and Care Services Operating Protocols 4611-1024-0957,4 Signature Page to Aspen Animal Shelter Lease Agreement EXHIBIT A PREMISES DESCRIPTION E7�rA F F F F alb Y a r i l PITI(iN COUNTY AN SHELTER MAN FLOOR 4811-1024-0957.4 Exhibit A to Aspen Animal Shelter Lease Agreement EXHIBIT A PREMISES DESCRIPTION A Pon N COUNTY AN SHELTER mAIN FLOOR Exhibit A to Aspen Animal Shelter Lease Agreement 4811-1024-0957.4 EXHIBIT B ASPEN/PITKIN COUNTY ANIMAL SHELTER AND CARE SERVICES OPERATING PROTOCOLS 1. Definitions. A. "City" shall mean the City of Aspen, Colorado its officers and employees. B. "County" shall mean the County of Pitkin, Colorado, its officers and employees. C. "Operator"shall mean that person or entity charged with the operational responsibility for the Aspen/Pitkin County Animal Shelter. D. "Shelter" shall mean that portion of the building at 101 Animal Shelter Road, Aspen, Colorado, that houses the Aspen/Pitkin County Animal Shelter. E. The term "City Animal" refers to an animal that is either found wandering within the municipal boundaries of the City of Aspen, or an animal that is released to the shelter by an owner who resides within the municipal boundaries of the City of Aspen. The term "County Animal" refers to an animal that is either found wandering within the unincorporated areas of Pitkin County, or an animal that is released to the shelter by an owner who resides within the unincorporated areas of Pitkin County. 2. Rules Pertaining to the Administration and Enforcement of the Pet Animal Care and Facilities Act. Animal care facilities in Colorado are regulated by the Colorado Department of Agriculture. Operator shall furnish the annual inspection report performed by the Colorado Department of Agriculture. Operator shall maintain and operate the shelter according to the latest rules and regulations promulgated by the Colorado Department of Agriculture. Operator shall be responsible for conforming to and abiding by changes to the Pet Care and Facilities Act which may be amended and revised from time to time by the Colorado General Assembly. Operator shall secure and maintain all necessary federal, state, and/or local licenses required to operate a kennel. 3. Hours of operation. Shelter may be open to the public not less than seven (7) hours per day, Monday through Friday, and not less than two (2) hours per day on weekends, holidays excluded. Exhibit B to Aspen Animal Shelter Lease Agreement 4811-1024-0957.4 4. Found Animals. Operator shall accept all dogs and cats brought to the Aspen/Pitkin County Animal Shelter which are found wandering from within the Aspen/Pitkin County jurisdiction. Animals found running at large and impounded at the shelter shall be available for adoption after waiting at the shelter for eight(8) calendar days. If an owner comes for his/her dog within the eight-day period,the operator may charge an impound fee of$50 for the first calendar day, and$30 for each additional calendar day. 5. Surrendered Animals. Operator shall accept all dogs and cats surrendered to the Aspen/Pitkin County Animal Shelter by all citizens residing within the Aspen/Pitkin County jurisdiction. Operator may charge a$50 surrender fee for each animal released to the shelter by its owner. Animals surrendered to the shelter by their owner shall be available for adoption immediately unless the animal is deemed to be unadoptable. 6. Redeemed Animals. All owners seeking to redeem their animal(s) impounded from within the City of Aspen jurisdiction shall first be referred to the Aspen Police Department for issuance and receipt of any animal control violation citation. Owners shall not be permitted to redeem their animal without first providing Operator with written authorization from the Aspen Police Department. In place of written authorization from the Aspen Police Department, a verbal release by the Aspen Police Department to the shelter Operator is also valid. All owners seeking to redeem their animal(s) impounded from within the Pitkin County jurisdiction shall first be referred to the Pitkin County Sheriff's Department for issuance and receipt of any animal control violation citation. Owners shall not be permitted to redeem their animal without first providing Operator with written authorization from the Pitkin County Sheriff's Department. In place of written authorization from the Pitkin County Sheriff's Department, a verbal release by the Pitkin County Sheriff's Department to the shelter Operator is also valid. 7. Adoption. Each animal made available for adoption via the Aspen/Pitkin County Animal Shelter will be neutered and vaccinated per the rules and regulations of the Colorado Department of Agriculture. Operator may charge a$100 adoption fee plus tax for each animal adopted from the shelter. 8. Snowmass Village. In order to assist the Town of Snowmass Village, the City of Aspen and Pitkin County have entered into an agreement with Snowmass Village. Operator will accept homeless dogs and cats from Snowmass Village as quarantined animals, found animals and/or surrendered animals. Operator will abide by all Colorado Department of Agriculture rules and regulations pertaining to each animal from intake to adoption and everything in between. All operating protocols agreed upon by Operator and Aspen/Pitkin County will be in effect, but Exhibit B to Aspen Animal Shelter Lease Agreement 4811-1024-0957.4 Aspen/Pitkin County will have no financial obligation for any Snowmass Village animals. Operator will pay for room and board,while Snowmass Village will pay for any medical expenses until the animal(s) is returned to its owner or adopted into a new home. 9. Goodwill Animals. In order to save as many homeless pets as possible, Operator may, when space permits, accept animals from outside of the Aspen/Pitkin County jurisdiction. These animals are labeled as Goodwill animals because they are accepted out of goodwill as opposed to jurisdictional obligation. Operator will abide by all Colorado Department of Agriculture rules and regulations pertaining to each animal from intake to adoption and everything in between. All operating protocols agreed upon by Operator and Aspen/Pitkin County will be in effect, but Aspen/Pitkin County will have no financial obligation for any Goodwill animals. 10. Recordkeepin and reporting. Per the Colorado Department of Agriculture, Operator shall maintain up to date and complete records of each animal(s) housed in the shelter. These records will be submitted to the Colorado Department of Agriculture annually.Additionally, Operator shall document the name, address and telephone number of all persons presenting an animal(s)for impoundment at the shelter,redeeming an animal(s)from impoundment,and/or adopting an animal(s)from the shelter. These records will be made available by the Operator to the City of Aspen and Pitkin County upon request by the City/County. Operator shall maintain accurate financial records for each type of service provided at the facility. 11. Miscellaneous costs. The City of Aspen and Pitkin County will,at their expense,be responsible for veterinarian services and medical expenses required for City and County animals housed at the shelter unless the aforementioned veterinarian services and medical expenses are caused by negligence of the operator. Spay/neuter policy. Per the Colorado Department of Agriculture, all animals must be spayed/neutered prior to adoption. Operator, however, is authorized to except the spay/neuter policy upon a determination that for health reasons the animal must wait to be sterilized at a later date. 12. Euthanasia. Shelter shall operate as a "no kill" shelter. Only a licensed veterinarian working on behalf of the Shelter can authorize the euthanasia of an animal. All euthanized City/County animals shall be the responsibility of the City or the County,including all costs associated with the procedure. Exhibit B to Aspen Animal Shelter Lease Agreement 4811-1024-0957.4 All animal remains shall be humanely handled and disposed of in a respectful manner. Per the Colorado Department of Agriculture, Operator shall maintain a written record identifying the animal and physical condition prior to death and the date of euthanasia for every animal euthanized. 13. Citizen Board. Operator acknowledges that the City/County have formed a citizen board known as the Aspen/Pitkin County Animal Shelter Advisory Board to provide recommendations and advice to the operator and the City/County in the operation of the shelter. Operator agrees to cooperate with the advisory board. 14. Fees and Charges. Operator shall charge, collect and retain the following fees: • Impound Fee: $50 on the first calendar day of impoundment and $30 each additional calendar day. • Surrender Fee: $50 for each animal released to the shelter. • Adoption Fee: $100 plus tax for each animal adopted. Exhibit B to Aspen Animal Shelter Lease Agreement 4811-1024-0957.4