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Home My WebLink AboutAmber Kinetics, Inc. - Grant of Option Agreement for APN 327-030-38Trl + ll" t4l)b -o?+ GRANT OF OPTION AGREEMENT THIS GRANT OF OPTION AGREEMENT (this 'Agreement") is made and entered into this þ_a aay of January 2016 (the "Effective Date"), by and between the City of Fresno ("City'), a municipal corporation, and Amber Kinetics, lnc., a California corporation ('Amber Kinetics"). City and Arnber Kinetics are sometimes collectively referred to in this Agreement as the "Parties" or singularly as a "Party" or by their indivídual names. RECITALS A. City is the owner of that certain real property located in the County of Fresno, State of California, referred to for convenience as approximately twenty-five (25) acres on the northeast portion of that certain real property identified by assessor's parcel number 327-030-3çT (the "Property"), a depiction of which is attached hereto as Êxhibit "A" and íncorporated herein by this reference. B. The Property is currently feased untÍl December 31 ,2016. C. Amber Kinetics desires to obtain fong-term site control of the Property for the purpose of developing a kinetic energy storage project on the site which witl provide energy storage to PG&E under an Energy Storage Agreement. D. City agrees to provide Amber Kinetics an option to lease the Property, pursuant to the terms and subject to the conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement and in these Recitals, which are hereby íncorporated by this reference, City and Amber Kinetics hereby agree as follows. 1. Parcel I Option and Lease (a) P?rcel 1 OptÍon. The City hereby grants to Amber Kinetics the exclusive option and right to lease ten ('10) acres of the Property ("Parcel 1"), as approximately identified in the attached "Exhibit B" (the "Parcel 1 Option"). The Parcel ? Option will commence on the Effective Date and expire July 31 ,2016 (the "Parcel 1 Option Term"). Amber Kinetics shall pay to the City a one-time, nonrefundable payment in the arnount of Two Thousand Four Hundred Dollars ($2,400) for the Parcef 1 Option. Arnber Kinetics may exercise the Parcel 1 Option at any time during the Parcel I Option Term with a notice in writing to City. (b) Parcel 1 Leasq. lf Amber Kinetics exercises the Parcel 1 Option, the "Parcel 1 Lease" shall be for an initial term of twenty-five (25) years (the "Parcef 1 Lease Term"). The Parcel 1 Lease Term shall begin on the later of January 1,2017 or the date that the City provides Amber Kinetics with possession of Parcel 1. Amber Kinetics shall pay the City, in equal monthly installments, an initial rent of Two Thousand Dollars ($2,000) per acre, per year (the "Parcel 1 Lease Payrnents"). The Parcel 1 Lease Payments shall increase annually by three percent (3o/o). (c) MainteinSnce of PropeÉv. Following the date that Amber Kinetics obtains possession of Parcel 1 from the City afler comrnencement of the Parcel 1 Lease, Amber KÍnetics shall be responsible for maintaining Parcel 1 in a manner that 1749638v I / I 90,10,0001 does not create a public nuisance and shall provÍde dust control, mowing, and weed control on Parcel 1 as is necessary to keep Parcel 1 in a reasonably satisfactory state of repau. lf City determines to provide possession of Parcel 2 (as described below) to Amber Kinetics prior to the date that Amber Kinetics exercises its option to commence the Parcel 2Lease, Amber Kinetics shall assume the responsibility to maintain Parcel2, subject to the same standards mentioned äbove, from the date that the City provides possession. The City is not, however, required to provide possession of Parcel 2 to Amber Kinetics prior to the comrnencement of the Paræ\2 Lease. 2. Parcel 2 Qption and Lease ia) Parcel ?,Ootion. The City hereby grants to Amber Kinetics the exclusive option and right to lease all or any portion of the remaining fifteen (15) acres of the Property ("Parcel 2"), as approximately identified in the attached "Exhibit B" (the "Parcel 2 Option"). The Parcel 2 Option will commence on the Effective Date and, unless terminated as provided herein, and shall expire on July 31,2019 (the "Parc,el2 Option Term"). Amber Kinetics shall rnake Option Payments to the City as follows: An initial non-refundable Two Thousand Seven Hundred Dollars ($2,700) for the first six (6) months, and payment of Four Hundred Fifty Dollars ($450) each month thereafter while the Parcel 2 Option is in effect (the 'Parcel 2 Option Payments'). lf Amber Kinetics exercises the Parcel 2 Option prior to the end of the Parcel 2 Optíon Term, a prorated portion of the Parcel 2 Option Payments actually made by Amber Kinetics shall be applied to the Parcel 2 lease payments- Amber Kinetics may exercise the Parcel 2 Option at any time during the Parcel 2 Option Term with a notice in writing no less than ninety (90) days prior to the start date of fhe Parcel 2 Lease. Amber Kinetics may also cancel the Parcel 2 Option with nÍnety (90) days' notice of cancelation. Amber Kinetìcs will be relieved of any further obligation to make Parcel 2 Option Payments or to maintain Parcel2 on the nineÇ-first (91"t) day following íts notice of cancelation. (b) Parcel 2 Lease. lF Amber Kinetics exercises the Parcel 2 Option, the "Parcel 2 Lease" shall be for an initial term of twenty-five (25) years (the "Parcel 2 Lease Term'). The Parcel2 Lease Term shall begin on the date (no later than January 1,2020) that Amber Kinetics specifies in its notice of exercise of its Parcel 2 Option or the date that the City provides possession of Parcel 2 to Amber Kinetics, whichever is later. Amber Kinetics shall continue to pay monthly Parcel 2 Option Payments to the City until the commencement of the Parcel 2 Lease. Following commencement of the Parcel 2 Lease, Amber Kinetics shall pay rent to the City in equal monthly installments and shall be calculated based on the same per acre rent Amber Kinetics pays for the Parcel 1 Lease (the "Parcel 2 Lease Payments"). The Parcel 1 and Parcel 2 Lease Payments shall escalate at the same rate so the per acre rent payments shall be consistent for the entire Propefi. 3. Restoration of Leased ProPertv Upon termination of the Lease for Parcel 1 and Parcel 2, Amber Kinetics shall be responsible for removing all equípment, materials and related appurtenances placed, installed, constructed, and stored by Amber Kinetics on Parcel 1 and Parcel2. Further, upon removing all equipment, materials and related appurtenances, Amber Kinetics shall restore the site to its current condition so that it can be suitably, safety, t? 49(ß8v1 i 1904Cr,0001 and readily returned to agricultural purposes for crop farming. All costs required to remove all equipment, rnaterials, and related appurtenances, and to restore the site to is current agricultural crop farming use shall be borne by Amber Kinetics. ln addition, all work required to remove all eguipment, materials, and related appurtenances, and to restore the site shall be completed within 18 months of the termination date of the lease for Parcel 1 and Parcel2. 4. Riqhtto lnspect (a) fn March and April of 2016, during the Parcel 1 Option Term, City shall provide Amber KÍnetics, and Amber Kinetics' agents, employees, and representatives (collectively, "An'ìber Kinetics' Agents") with reasonable access to the Property, and each portion thereof, to allow Amber Kinetics and Amber Kinetics' Agents to investigate, inspect, and to conduct such tests upon the Property, and each portion thereof, as Amber Kinetics has deemed necessary or advisable. 5. Miscellaneous (a) Notices. All notices required or permitted by this Agreement shall be in writing and may be delivered in person or sent by mail, facsimile transmission, or electronic transmission (email). The addresses and addressees noted below are that Party's designated address and addressee for delivery or mailing of notices. To City: Thomas C. Esqueda Director of Public Utilities City of Fresno 2600 Fresno Street, Rm. 3065 Fresno, CA93721 Telephone: (559) 621 -8600 Facsimile: (669) 488-1304 Email: í:r:¿ií]4rËii _,.+lil,,-:--í,;j_i To Amber KinetÍcs: Bill Barnes Managing Director Development Amber Kinetics, lnc. 32920 Alvarad o-N iles Road Union City, CA 94587 Telephone : (4151 218-3935 Facsimile: (51 0) 47 4-1000 Email:,t'riq,i:,1æ!¡JÆf :þ?iíifir,1lqFJt¿iìl With copy to: Christopher L. Campbell BAKER MANOCK & JENSEN, PC 5260 N. Palm Avenue, Suite 421 Fresno, California 937 04 Telephone: (559) 432-5400 Facsim ile: (559) 432-5620 Email:;;t¿¿;i.uiv|;i5.1þ.:tz!i!:]i',¡.,ÇtiL,l:i:-,".., Either Pafi may, by written notice to the other, specify a different address for notice. I 749638v1 / 19040.0001 (b) Fntire Ag.reement. This Agreement and items incorporated herein contain all of the agreements of the Pa¡ties with respect to the matters contained herein, and no prior agreement or understanding pertaining to any such matter shall be effective for any purpose. The Parties further warrant and represent that they have not relied on any inducements, promises, or representations made by any Party or its representative, or any other person, except for those expressly set forth herein. (c) Amendfnents. No provisions of this Agreement may be amended or modifìed in any rnanner whatsoever except by an agreement in writing duly authorized by representatives of both Parties. (d) Cqunterparts- This Agreement may be signed by the Parties in different counterparts, which together shall constitute one Agreement, even though all Parties may not have signed the same counterpart. lN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written. CITY AMBER KINETIGS City of Fresno, a municipalcorporation Amber Kinetics, lnc., a California corporation City Manager ATÏEST; WONNE SPENCE, CMC City Clerk lr, Pres. or (lf corporation or LLC, CFO, Treasurer, Secretary or Assistant Secrefary) APPROVED AS TO FORM: By: Title: Deputy tVræ Mloratr+? ^ l-ltcllç J ¿t æ\ay.'l-b 'rd,w¡,.ì' Chiac LE'lß""n\ ñ \¡r¿utm Attachment: Exhibit A Exhibit B 4 APPROVED AS TO FORM: DOUGLAS T. SLOAN ndon M. Collet t749638v1 / 19û40 0001 W JENSTN AVt t_|-l Z-v.oO Exh¡b¡t B Proposed Parcels for Energy Storage Project