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BACKGROUND The City has contracted with Lifetime to operate and maintain the tennis facilities at the Tennis and Community Park since 2005. Lifetime has acted as the City's agent in all matters related to tennis operations including maintenance of the tennis complex, public restrooms, and courts; activity registration, court reservations, processing payments and handling all customer service matters; as well as tennis instruction, league coordination, and specialty classes and camps. This current agreement with Lifetime was entered into on January 1 , 2011 (Attachment 2). This agreement provided for rental payments equal to 10% of all gross revenues, with a cap that increased annually. A First Amendment was approved on September 30, 2015 (Attachment 3); and an Extension of Service was approved on December 20, 2016 (Attachment 4). This Extension of Service modified the rental payment terms to fixed annual amounts, rather than a percent of revenue. A Second Amendment was approved on December 4, 2018 to update facility improvement responsibilities at the Tennis and Community Park (Attachment 5). Since the COVID-19 shutdown in mid-March 2020, Lifetime has made every effort to minimize the impacts of the pandemic on operations, while following all ACPHD guidelines. Lifetime applied for, received, and distributed the government sponsored Paycheck Protection Program allocation to retain its key staff members. Two months of full facility closure during the spring and limited summer operations (25% of normal) have caused Lifetime to fully deplete the federal monies, along with a significant portion of their reserve accounts. Lifetime was provided rent abatement and rent deferment through a Force Majeure event, outlined in the original agreement, Section 13.03 (Attachment 2). Rent abatement was authorized during the facility closure from March 16, 2020 to May 28, 2020. Rent deferment was authorized from May 28, 2020 through December 31, 2020 (Attachment 6). DISCUSSION Lifetime expects to face continued challenges into the fall and winter seasons due to the continued COVID-19 pandemic and strict County guidelines for tennis operations, including: • Reduction of class ratios due to County limitations • Lack of school gym use for additional activity programming (table tennis, badminton, etc.) whereas allowed prior to COVID-19 • Diminished retail services • Cancelled youth and adult USTA leagues • Reduced program participation due to decline of local economy • California wildfire-generated air quality issues with class and facility closures • COVID-19 related costs and community/staff health concerns Page 2 of 3