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1 <br />OPERATING SUBSIDY AGREEMENT <br />THIS OPERATING SUBSIDY AGREEMENT (this "Agreement") is made this <br />_______________, 202__, by and between the City of San Leandro, a California municipal <br />corporation ("City"), and Housing Consortium of the East Bay, a California nonprofit public <br />benefit corporation ("Operator"). <br />RECITALS <br />A.City and Operator have entered into a “Ground Lease,” dated _______________, <br />2023, which provides for City to lease to Operator that certain real property located at 555 <br />Lewelling Boulevard, San Leandro (the “Property”). <br />B.Pursuant to the Ground Lease, Operator will convert the Property into an interim <br />homeless shelter with twenty-nine non-congregate shelter units, navigation center for homeless <br />persons and persons at risk of homelessness, offices for management and services staff, meeting <br />and conference spaces, community room, laundry room, modular trailer for shower services for <br />navigation center clients, modular trailer for office space, parking, landscaping and lighting (the <br />“Project”). <br />C.The Ground Lease further provides for City and Operator to enter into a separate <br />Operating Subsidy Agreement pursuant to which City will agree to provide specified payments to <br />Operator as necessary for payment of the costs of operation of the Project. <br />NOW, THEREFORE, in consideration of the premises and the mutual covenants <br />contained in this Agreement and for other good and valuable consideration, the receipt and <br />adequacy of which is hereby acknowledged, the parties hereto agree as follows: <br />ARTICLE 1 <br />DEFINITIONS <br />1.1 Specific Terms. Unless the context otherwise requires, the following capitalized terms <br />(whether singular or plural) shall have the meanings set forth below: <br />"Agreement Date" means the date set forth in the first paragraph of this Agreement. <br />"Annual Operating Budget" means the operating budget for the Project approved by <br />City attached hereto as Exhibit B, or as otherwise amended by Operator and City. <br />"Applicable Laws" means all applicable present or future federal, state, local and <br />administrative laws, rules, regulations, codes, orders and requirements. <br />"Assisted Units" means the residential units at the Project. <br />"City" means the City of San Leandro. DRAFT