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LEASE OF WATER RIGHTS
PRODUCTION RIGHT
THIS LEASE OF WATER RIGHTS (the "Lease ") is entered into on this 1st day
of July 2009, by and between Azusa Valley Water Company ( "Owner ") and the City of
Arcadia ( "Arcadia "), a California municipal corporation with respect to the following:
RECITAL
This Agreement is made with respect to the following facts:
Owner owns of record and beneficially of otherwise controls, or is the duly
authorized and acting agent for the owners of 2,500 acre feet of Production Rights
in the Main San Gabriel Basin as adjudicated in the case of "Upper San Gabriel
Valley Municipal Water District vs. City of Alhambra, et al" LASC No. 92418.
The ownership of said Rights entitle Owners to take delivery or otherwise
produce from the Main San Gabriel Basin said 2,500 acre feet of water on an
annual basis or in such amount as is determined from time to time by the Main
San Gabriel Basin Watermaster. As of the date hereof, the Rights associated with
said Production Right are 2,500 acre -feet for the 2008 -09 water year.
AGREEMENT
IN CONSIDERATION of the foregoing recital and the mutual promises set forth
herein, Owner and Arcadia agree as follows:
1. Leasing of Production Rights. Owner hereby leases to Arcadia, and Arcadia
hereby leases from Owner 2,500 acre -feet of Rights for the term and upon the
terms and conditions set forth in this Lease.
2. Term. The term of this Lease shall be for a period commencing June 20, 2009
and ending June 30, 2009.
3. Lease Rate, Payment and Adjustment
(a) The gross rental payable under this Lease for the term set forth
in paragraph 2 above shall be $1,035,000.00 which has been calculated
on the basis of $414 per acre -foot, 92% of the Replenishment Rate of
$450 as set by the Main San Gabriel Groundwater Basin Watermaster. .
Lease of Water Rights Page 1 7/27/2009
(b) The annual rate shall be paid by Arcadia upon receipt of an invoice for
the full amount from Azusa Valley Water Company
(c) All payments due Owner pursuant to this Lease shall be made and sent
as follows:
Azusa Valley Water Company
P.O. Box 9500
Azusa, CA 91702
4. Agreement Re: Main San Gabriel Basin Watermaster.
(a) Owner agrees to execute and deliver to Arcadia all documents which,
from time to time, may be required by the Main San Gabriel Basin
Watermaster to reflect the Lease to Arcadia of the Production Rights
which are the subject of this Lease. All such documents shall be in
such form and substance as shall be reasonably satisfactory to Owner,
Arcadia and Watermaster.
(b) Arcadia shall, at its expense, prepare and submit all reports required
by the Main San Gabriel Basin Watermaster in connection with the
exercise by Arcadia of the Rights.
(c) This Lease entitles Arcadia to the use only of the Rights (i.e.,
purchase of water) associated with the Production Rights. Owner
retains and does not convey to Arcadia any other Rights associated
with said Production Right.
5. Other Provisions. Owner and Arcadia further agree as follows:
(a) In the event any dispute shall arise between the parties to this
Agreement, the same shall be resolved by arbitration conducted by the
American Arbitration Association in accordance with the Commercial
Arbitration Rules of the American Arbitration, as then in affect. Such
arbitration shall be conducted in a site within Los Angeles County,
California agreeable to both parties before three (3) arbitrators who
shall be selected by mutual agreement of the parties; if agreement is
not reached on the selection of arbitrators within fifteen days, then
each of the parties shall select an arbitrator and the two (2) arbitrators
so selected shall select a third. The provisions of the Commercial
Arbitration Rules of the American Arbitration Association shall apply
and govern such arbitration except that the prevailing party shall be
entitled to recover from the other party its attorney's fees actually
incurred in such amount as may be determined by the arbitrators.
Lease of Water Rights Page 2 7/27/2009
(b) All communications, notices and demands (collectively "Notices ") of
any kind shall be made in writing and personally served or sent by
registered or certified mail, postage prepaid to the following:
Owner: Chet Anderson
Azusa Valley Water Company
P.O. Box 9500
Azusa, California 91702
Arcadia: Pat Malloy
City of Arcadia - Public Works
P.O Box 60021
Arcadia, California 91006
Any Notice personally served shall be effective upon service. Any
Notice sent by mail, and properly addressed, shall be effective upon
date of receipt, or refusal as indicated on the return receipt. Either
party may change its address for Notices by Notice to the other given
in a manner provided in this subparagraph.
(c) This Lease shall inure to the benefit of and be binding upon the heirs,
successors and assigns of both parties hereto.
(d) Each party shall, upon request of the other party, take such further
actions and execute and deliver such further instruments as shall be
reasonably required to carry out the purpose and intent of this Lease.
(e) This Lease is executed in the State of California and shall be
governed by and construed in accordance with California law. Venue
for any action arising out of or related to the Lease shall be placed in
any court of the State of California with appropriate jurisdiction and
located in the County of Los Angeles, with service of process to be in
accordance with the then provisions of the California Code of Civil
Procedure.
(f) This Lease may be executed in two or more counterparts, each of
which shall be an original but all of which, together, shall constitute a
single instrument. It shall not be necessary for both parties to execute
the same counterpart(s) of this Lease for this Lease to become
effective.
(g) This Lease constitutes the entire agreement of the Owner and Arcadia
with respect to the subject matter hereof. This Lease supersedes all
prior discussions and understandings with respect to the subject
matter hereof. There are no representations, warranties, promises or
covenants as to the subject matter hereof except as expressly set forth
in this Lease.
(h) This Lease may be amended only by a written instrument executed by
the party to be charged.
Lease of Water Rights Page 3 7/27/2009
(i) The paragraph headings contained in this Lease are for convenience
only and shall not be considered in the construction or interpretation
of any provision hereof.
(j) Owner represents and acknowledges that the is executing this Lease
either as the beneficial and recorded owner of certain of the
Production Rights or as the duly authorized representative of the
beneficial and recorded owner of all Production Rights not
beneficially owned by Owner.
IN WITNESS WHEREOF, Owner and Arcadia have executed and delivered this
Lease of Water Rights as of the day first above written.
Azusa Valley Water Company
A California Corporation
&4 4 `
Francis M. Delach
City Manager
City of Arcadia
California Municipal Corporation
(Name & Title)
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(i) The paragraph headings contained in this Lease are for convenience
only and shall not be considered in the construction or interpretation
of any provision hereof.
(j) Owner represents and acknowledges that the is executing this Lease
either as the beneficial and recorded owner of certain of the
Production Rights or as the duly authorized representative of the
beneficial and recorded owner of all Production Rights not
beneficially owned by Owner.
IN WITNESS WHEREOF, Owner and Arcadia have executed and delivered this
Lease of Water Rights as of the day first above written.
Azusa Valley Water Company
A California Corporation
City of Arcadia
California Municipal Corporation
Pat Mallo ,
Asst. City Manager/
Public Works Services Director
Lease of Water Rights Page 4 7/27/2009