11-04 EXAMPLE - CITY FARM LEASE.pdf

Grazing and Agricultural Lease Agreement

Basic Terms

Date: JANUARY 1, 2026

Landlord: CITY OF SAN ANGELO, a Texas home rule municipal corporation

Landlord’s Address: 72 W. College Avenue, San Angelo, Tom Green County, Texas 76903

Tenant: TENANT

Tenant’s Address: 111 Farm Dr., San Angelo, Tom Green County, Texas 76904

Home Phone: (325) 555-5555 Email: farmer@gmail.com

Leased Premises: SURFACE ESTATE ONLY of approximately xxxx acres of land out of Sarah

R. Robertson Survey 178 in Tom Green County, as shown on the attached Exhibit “A”

(“Leased Premises”) which is incorporated herein by reference for all purposes.

Landlord’s Reservation of Rights: Landlord reserves the right at any time to execute and deliver valid oil, gas and other mineral leases and valid right-of-way easements for gas, oil, water or sewer pipelines, roads, telephone, telegraph or electric transmission lines covering

Leased Premises or any part thereof. In such event, this Lease shall be subject and subordinate to the rights, terms and privileges of any such oil, gas or other mineral lease or such easements as may have been executed heretofore or hereafter by

Landlord. Rent payable under this Lease will be adjusted for any productive acreage damaged by the exercise of any such reserved right.

Effective Date: January 1, 2026

Termination Date: December 31, 2030

Permitted Use: Leased Premises shall be used for grazing, cultivation and uses normally incident thereto, and for no other purpose.

Initial Payment: Initial Rent Payment due and payable on execution of this Lease, is the sum of

Two Hundred Seventy-Six Dollars ($276.00) – one time Granting Fee.

Annual Rent: Annual Rent shall be paid on or before January 1st of each year, during the term of this Lease, the sum per year as listed below:

First Year $25,000.00

Second Year $25,500.00

Third Year $26,010.00

Fourth Year $26,530.00

Fifth Year $27,061.00 mailto:farmer@gmail.com

Clauses and Covenants

A. Tenant agrees to—

1. Lease the Premises for the entire Term beginning on the Effective Date and ending on the Termination Date.

2. Obey all laws, ordinances, rules and regulations relating to Tenant’s use and maintenance of the Leased Premises, including Code of Ordinances of the City of San

Angelo. Any breach of said ordinances, rules or regulations shall be deemed a default of this Lease Agreement, and, at the option of the Landlord, may result in termination of this

Lease.

3. Pay in advance the Initial Rent Payment, and on or before January 1st of each year during the term of this Lease, the Annual Rent to Landlord at Landlord’s Address, 72 W.

College, San Angelo, Texas 76903.

4. Pay to Landlord a late charge and interest for any rent received by Landlord after the date that the rent is due in accordance with applicable ordinances and fee schedules, provided however, that acceptance by Landlord of late charges or interest shall not be construed as a waiver of the right of Landlord to terminate this Lease at its option as authorized herein.

5. Pay all taxes on Tenant’s property located on the Leased Premises.

6. Leased Premises shall be used by Lessee for grazing, cultivation and uses normally incident thereto, including maintenance as fallow land, and for no other purpose.

(hereinafter “Permitted Use”) If at any time the Leased Premises and any improvements thereon shall cease to be used for such purpose, Landlord shall have the right to terminate this Lease by written notice given to Tenant, no less than thirty (30) days prior to the date of termination.

7. At Tenant’s sole expense, keep and maintain fences and other improvements now on the Leased Premises in good condition, maintain landscape, and keep said Premises clean and cleared of all objectionable matter, including accumulations of trash, personal property, brush, and accumulations of dead vegetation. In the event Tenant shall fail to maintain Leased Premises in a manner acceptable to Landlord as herein required, after notice of default to Tenant, Landlord may enter upon the Leased Premises without further notice and cause Leased Premises to be cleaned, cleared, and mowed, and may dispose of all objectionable matter in the manner deemed appropriate by Landlord. Tenant expressly authorizes the cost of any such clearing, cleaning, mowing and disposal to be billed to

Tenant separately as rent or added to the next Annual Rent payment due, interest at the ten percent (10%) per annum, beginning thirty (30) days from the date on which the work was completed, and continuing until such cost is paid in full.

8. Tenant’s Permitted Use shall be restricted to use only of the Leased Premises and shall not extend to any other property of the Landlord. Tenant’s use of the Leased Premises shall be in compliance with applicable federal, state and local laws and regulations.

9. Vacate the Leased Premises on the last day of the Term. Any crops not harvested prior to expiration of the Term shall become the sole property of Landlord, without liability or reimbursement due to Tenant.

10. Indemnify, Defend, and Hold Harmless Landlord as follows:

a. TENANT FURTHER AGREES TO INDEMNIFY DEFEND, AND HOLD HARMLESS, LANDLORD, ITS OFFICERS, AGENTS AND EMPLOYEES, FROM ANY AND ALL CLAIMS

(INCLUDING BUT NOT LIMITED TO CLAIMS FOR DEATH, PERSONAL INJURY AND

PROPERTY LOSS OR DAMAGE), FAULT, LIABILITIES, DEMANDS, SUITS, CAUSES OF

ACTIONS OR PROCEEDINGS OF ANY KIND OR NATURE, FOR LOSSES OR DAMAGES

INCLUDING ATTORNEYS’ FEES AND COST OF DEFENSE, WHICH THE INDEMNIFIED

PARTIES MAY INCUR ARISING OUT OF THE NEGLIGENCE, ERROR, OMISSION,

INTENTIONAL ACTS OR OTHER CAUSE, RESULTING DIRECTLY OR INDIRECTLY

FROM, OR IN ANY WAY RELATING TO THE EXERCISE BY TENANT OF THE

PRIVILEGES CONFERRED BY THIS LEASE.

b. ENVIRONMENTAL INDEMNIFICATION. TENANT AGREES TO INDEMNIFY, DEFEND AND HOLD LANDLORD, ITS OFFICERS, AGENTS AND EMPLOYEES FREE AND

HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, PROCEEDINGS,

SUITS, JUDGMENTS, COSTS, PENALTIES, FINES, DAMAGES, LOSSES, ATTORNEYS’

FEES AND EXPENSES ASSERTED BY LOCAL, STATE OR FEDERAL ENVIRONMENTAL

AGENCIES OR PRIVATE INDIVIDUALS OR ENTITIES IN CONNECTION WITH OR

RESULTING FROM OR ARISING OUT OF TENANTS HANDLING, COLLECTION,

TRANSPORTATION, STORAGE, DISPOSAL, TREATMENT, RECOVERY, AND/OR REUSE

BY ANY PERSON UNDER TENANT’S DIRECTION OR CONTROL OF WASTE

COLLECTED, TRANSPORTED OR LANDFILLED OR ANY CLEANUP ASSOCIATED WITH

ENVIRONMENTAL CONTAMINATION, WHETHER SUCH CLEANUP IS OF AIR, SOIL,

STRUCTURE, GROUND WATER OR SURFACE WATER CONTAMINATION. TENANT

SPECIFICALLY AGREES TO INDEMNIFY, DEFEND AND HOLD HARMLESS CITY

AGAINST ALL CLAIMS, DAMAGES AND LIABILITIES OF WHATEVER NATURE

ASSERTED UNDER CERCLA CAUSED BY ACTS OR OMISSIONS OF TENANT

REGARDLESS OF WHEN SUCH INCIDENT IS DISCOVERED. TENANT SHALL BE

RESPONSIBLE AND LIABLE FOR ANY SPILL, UNDERGROUND POLLUTION OR ANY

OTHER ENVIRONMENTAL IMPAIRMENT INCIDENT CAUSED BY ACTS OR OMISSIONS

OF TENANT REGARDLESS OF WHEN SUCH INCIDENT IS DISCOVERED. IT IS THE

INTENT OF THE PARTIES THAT THIS SECTION SHALL IN NO WAY LIMIT OTHER

COVERAGE HEREIN AS IT MAY RELATE TO ANY ENVIRONMENTAL CLAIM,

DAMAGE, LOSS OR LIABILITY OF ANY KIND.

THIS INDEMNIFICATION, DEFEND AND HOLD HARMLESS AGREEMENT

SHALL SURVIVE THE TERM OF THIS AGREEMENT AS LONG AS ANY

LIABILITY COULD BE ASSERTED. NOTHING HEREIN SHALL REQUIRE THE

INDEMNIFYING PARTY TO INDEMNIFY, DEFEND OR HOLD HARMLESS ANY

INDEMNIFIED PARTY FOR THE INDEMNIFIED PARTY’S OWN GROSS

NEGLIGENCE OR WILLFUL MISCONDUCT.

11. Maintain Insurance in accordance with the attached Insurance Addendum and as follows:

a. Tenant shall obtain and maintain continuously in effect at all times during the term hereof, at Tenant’s sole expense, minimum general liability insurance in the amount of at least $100,000.00 combined single limit liability per occurrence for bodily injury and property damage. This insurance shall be an occurrence-type policy and shall protect Landlord against liability which may accrue against

Landlord by reason of Tenant’s occupancy or control over the Leased Premises, or wrongful conduct incident to the use thereof, resulting from any accident or event occurring on or about the Leased Premises. All insurance policies required herein shall be drawn in the name of Tenant, with Landlord, its council members, officials, officers, directors, agents and employees named as additional insureds.

b. Tenant shall furnish Landlord with certificates of insurance as evidence that all of the policies required herein are in full force and effect and provide the required coverages and limits of insurance. The certificates shall provide that any company issuing an insurance policy shall provide not less than 30-days advance notice in writing of cancellation, non-renewal or material change in the policy of insurance.

In addition, Tenant shall immediately provide written notice to Landlord upon receipt of notice of cancellation of an insurance policy, or of a decision to terminate or alter any insurance policy. All certificates of insurance shall clearly state that all applicable requirements have been satisfied including certification that the policies are of the “occurrence” type. Certificates of insurance for Landlord shall be mailed in accordance with the notice provisions of this Lease Agreement.

c. Tenant shall require its insurance carrier, with respect to all insurance policies, to waive all rights of subrogation against the City of San Angelo, its council members, members of boards and commissions officers, officials, agents and employees.

d. The procuring of such policies of insurance shall not be construed to be a limitation upon Tenant’s liability or as a full performance of its obligations under the indemnification provisions of this Lease. Tenant’s obligations are, notwithstanding said policies of insurance, for the full and total amount of any damage, injury or loss caused by or attributable to its occupation or control over the Leased Premises pursuant to this Lease or any extension thereof.

12. Cultivate the Leased Premises in a timely, thorough, and farmerlike manner, employing the best methods of farming customarily practiced on like crops in the area.

13. Maintain adequate records on all matters related to the Permitted Uses and provide

Landlords copies upon request.

14. Keep all gates on the Leased Premises closed and locked.

B. Tenant agrees not to—

1. Use the Leased Premises for any purpose other than the Permitted Use, including that:

a. No improvements or construction work, including but not limited to living quarters, buildings, pump houses, water wells, storage buildings, excavations, fills, or other types of structures or improvements shall be built or placed on the Leased

Premises.

b. No storage of personal property shall be permitted on the Leased Premises, including equipment, machinery, vehicles, appliances, temporary electrical wiring, materials, or supplies.

2. Create or allow any nuisance or waste on Leased Premises.

3. Alter the Leased Premises, including:

a. Clearing new roads or locating on Leased Premises any type of manufactured housing or mobile home.

b. Removing any trees from Leased Premises without first obtaining permission from Landlord.

4. Allow a lien to be placed on the Leased Premises or on the crops raised on or harvested from the Leased Premises.

5. Assign this Lease or sublease any portion of the Leased Premises without

Landlord’s written consent.

6. Hunt or fish on the Leased Premises; except for deer hunting. Tenant, Tenant’s spouse and children are allowed to hunt deer on the premises in accordance with all applicable local, state or federal laws. Tenant shall not allow any other individuals to hunt deer on the premises.

7. Litter or leave trash or debris on the Leased Premises.

C. Landlord agrees to—

Lease to Tenant the Leased Premises beginning on the Commencement Date and ending on the Termination Date unless earlier terminated as herein provided, subject to: easements of record, Landlord’s Reservation of Rights, and Tenant’s compliance with the terms and conditions of this Lease.

D. Landlord agrees not to—

Allow any use of the Leased Premises inconsistent with Tenant’s Permitted Use, subject to the Reservation of Rights herein stated, so long as Tenant is not in default.

E. Special Conditions:

1. Limited Use. Leased Premises shall not be used for a dairy operation or a high-density cattle or commercial feedlot operation or facility. The maximum stocking rate of livestock on the premises, unless approved otherwise by Landlord, shall be 2 acres per animal unit on irrigated pasture land; 15 acres per animal unit on non-irrigated pasture land;

2 acres per animal unit on irrigated cropland with small grain or forage sorghum and 3 acres per animal unit on non-irrigated cropland with small grain or forage sorghum.

Animal unit shall be as defined by the Natural Resources Conservation Service, NRCS.

2. Effluent Holding Lagoon Site. No livestock will be permitted on the effluent holding lagoon site.

3. Treated Wastewater Effluent. Landlord shall have the right at any time to utilize

Leased Premises for disposal of treated wastewater effluent. Landlord shall not be liable for any harm or damages that may result to Tenant’s crops, grasses, hay, cattle or operations from the application of the effluent to the Leased Premises. Tenant shall coordinate his operation to accommodate disposal of the effluent. Landlord shall have the right to irrigate such areas in the Leased Premises in amounts as authorized under the permit from the State of Texas. Landlord does not portray or guarantee that there will ever by any effluent available to Tenants for irrigation.

4. Pivots. Landlord will be allowed to operate pivots as needed for maintenance.

Pivots will normally be parked in a place that will be considered the storage location.

Landlord will not be responsible for maintenance of areas around pivots.

5. Flood Irrigation Fields. Existing flood irrigation fields shall be maintained, and borders shall not be removed.

F. Landlord and Tenant mutually agree to the following:

1. Rent Adjustment. Landlord and Tenant agree yearly rent shall escalate at a rate of

2% as detailed in section entitled Annual Rent.

2. Temporary Improvements. Tenant may place temporary improvements on Leased

Premises only with the prior, written approval of Landlord. Such improvements shall be for agricultural and grazing purposes only. Temporary improvements for other purposes are prohibited. Nothing shall be constructed, placed, or planted on Leased Premises which will in any way obstruct the natural flow of drainage or of rising water. Temporary improvements shall not include walls or be more than ten (10) feet in height. Tenant shall secure any required permits prior to placement of any temporary improvement on the

Leased Premises. Temporary improvements shall be constructed in compliance with all applicable codes, laws, rules or regulation. Improvements permitted and erected by Tenant shall be Tenant's property during the Term of this Lease. Prior to termination of this Lease, Tenant shall remove all alterations, additions and improvements erected by Tenant and restore the Leased Premises to its original condition by the Lease Termination Date or upon earlier vacating of the Leased Premises. However, Landlord shall have the right to elect, during the thirty (30) days prior to termination or earlier vacating of the Leased Premises, that any such alterations, additions and improvements shall become the property of

Landlord as of the date of termination or upon earlier vacating of the Leased Premises, and that they shall not be removed by Tenant. If any property which is required to be removed is not removed, then Landlord, in addition to all other rights or remedies may, at its election, deem that the property has been abandoned by Tenant to Landlord, but no such election shall relieve Tenant of the cost to remove the property or repair any damage.

3. Water Usage. Landlord does not warrant the availability of water. Tenant, subject to approval by Landlord, may utilize ground water from wells on the property for stock watering. Tenant shall be responsible for all costs associated with constructing, operating and maintaining any stock watering systems on the Leased Premises. At the conclusion of this Lease, Tenant shall be allowed to remove from the premises any stock watering systems placed on the premises by Tenant which may be removed without damaging the

Leased Premises, exclusive of underground piping. Any underground piping and associated appurtenances shall not be removed and shall become the property of the City.

Usage of the groundwater by Tenant shall be in accordance with and subject to any requirements of state or federal agencies or the local underground water district. No water from wells on property shall leave Leased Premises. At no time shall water from river be utilized by Tenant. No water well may be drilled on the property without the prior written approval of Landlord. No monitoring wells may be used for water well purposes. No irrigation wells are to be drilled on the Leased Premises.

4. Farm Subsidy Program. So long as Tenant is not in default under the terms of this

Lease, Tenant shall retain all proceeds from any farm subsidy program applicable to the raising of crops or livestock on the Leased Premises.

5. Highly Erodible Land. Portions and possibly all the Leased Premises may be classified as "Highly Erodible" by the Conservation Service under federal farm programs.

As may be applicable, Tenant shall be responsible for implementing and following any conservation plan required for the Leased Premises by the United States Department of

Agriculture.

6. Release of Claims. Tenant expressly releases Landlord, its officials, officers, agents, and employees from any and all claims and damages of any kind whatsoever by reason of the condition of Leased Premises, or any improvements thereon, or any damages or loss incurred by Tenant relating to Tenant’s use of the Leased Premises or exercise of the privileges granted hereunder.

7. Livestock. Landlord will not be responsible for the death, loss or theft of any livestock from the leased premises. Any dead animal must be removed from the leased premises within twenty-four (24) hours of death at tenant’s expense. Landlord assumes no liability for the death or injury to any livestock, regardless of cause.

8. Termination of Lease for Public Purposes. If Landlord shall deem that Leased

Premises are required for any public purpose during the term of this Lease, Landlord shall have the right to terminate this Lease by giving ninety (90) days written notice to Tenant of Landlord’s election to terminate the Lease. Tenant shall promptly deliver possession of

Leased Premises to Landlord on the effective date of termination or crops are harvested from the cultivated land, whichever is later.

9. No Encumbrances. Tenant shall not have the right to encumber the Leased

Premises.

10. Transfer, Assignment and Subletting. Tenant may not transfer, assign or sublet the

Leased Premises, in whole or in part, without the prior written consent of the Landlord, which consent may be withheld in the sole discretion of Landlord.

11. Debts Related to Leased Premises.

a. Utilities: Any utility charges relating to Tenant’s occupancy, control or use of the Leased Premises shall be paid in full by Tenant when due. Failure to timely pay such charges shall, at the option of Landlord, result in termination of this Lease.

b. Taxes: It is further understood and agreed that Tenant shall pay and discharge all taxes, general and special assessments, and other charges of every description which during the term of this Lease may be levied on or assessed against the Leased

Premises and all interest therein and all improvements and other property thereon, whether belonging to Landlord or Tenant, or to which either of them may become liable. Tenant shall pay all such taxes, charges, and assessments to the public officer charged with the collection thereof not less than fifteen (15) days before the same shall become delinquent, and Tenant agrees to indemnify and save harmless

Landlord from all such taxes, charges and assessments. Failure to pay such taxes and special assessments as provided herein shall, at the option of Landlord, result in termination of this Lease.

12. Landlord’s Lien. Tenant grants to Landlord a security interest in the collateral to secure payment and performance by Tenant of all obligations and payments due from

Tenant under this lease. The collateral will include all of Tenant’s crops, livestock, and personal property located or to be located on the Premises, and all products, proceeds, offspring, increase, governmental payments, insurance proceeds, documents of title, and warehouse receipts relating to such property.

This lease is a security agreement under both article 9 of the Texas Business and

Commerce Code and the federal Food Security Act of 1985. Landlord may file financing statements or continuation statements to perfect or continue the perfection of the security interest. Tenant agrees to furnish to Landlord a list of the names and addresses of any buyer, commission merchant, or selling agent to or through whom Tenant may sell the collateral.

Tenant agrees to notify Landlord of the identity of any buyer, commission merchant, selling agent, or warehouse to or with whom Tenant intends to sell or store the collateral within seven days before any sale or storage of the collateral.

13. Default by Tenant/Events. The following shall constitute events of default by

Tenant:

a. failing to timely pay Annual Rent or any other fee or charge when due under the terms of this Lease Agreement; or,

b. failing to comply within thirty (30) days after written notice with any provision of this Lease Agreement other than failing to timely pay Annual Rent.

14. Default by Tenant/Landlord’s Remedies. Landlord’s remedy for Tenant’s default, after compliance with the notice provisions hereof, is to terminate this Lease

Agreement by written notice, take possession of the Leased Premises, and seek judicial relief for costs, rents due and such other damages or relief to which Landlord may be entitled. Landlord may enter and take physical possession and control over the Leased

Premises on termination of this Lease by self-help and may prohibit the Tenant in default or any other person who may be occupying the Leased Premises, from access thereto or the use thereof, and shall not be liable in trespass or for damages, therefore.

15. Default/Waiver/Mitigation. It is not a waiver of default if the Landlord fails to declare immediately a default or delays in taking any action. Pursuit of any remedy set forth in this Lease does not preclude pursuit of other remedies under this Lease or provided by law.

16. Reimbursement of Landlord’s Expenses. Tenant shall reimburse Landlord on demand for all of Landlord’s expenses, including but not limited to attorney’s fees and court costs, incurred in enforcing any of Tenant’s obligations under this Lease or in terminating this Lease and retaking physical possession of the Leased Premises on Tenant’s default.

17. Amendment of Lease. This Lease may be amended only by an instrument in writing signed by Landlord and Tenant.

18. Disclaimer of Warranties. ALL WARRANTIES OF LANDLORD THAT MAY

ARISE IN COMMON LAW ARE EXCLUDED LANDLORD GIVES NO WARRANTY,

EXPRESS OR IMPLIED, AS TO THE CONDITION OF THE LEASED PREMISES OR

ANY IMPROVEMENTS THEREON, INCLUDING WARRANTY OF HABITABILITY

OR FITNESS FOR A PARTICULAR USE. THERE ARE NO IMPLIED WARRANTIES

OF MERCHANTABILITY, OF FITNESS FOR A PARTICULAR PURPOSE, OR OF

ANY OTHER KIND ARISING OUT OF THIS LEASE AGREEMENT, AND THERE

ARE NO WARRANTIES THAT EXTEND BEYOND THOSE EXPRESSLY STATED

IN THIS WRITTEN LEASE AGREEMENT.

19. Notices. Any notice required or permitted under this Lease must be in writing and delivered to the address for the recipient party. Any notice required by this Lease will be deemed to be delivered (whether actually received or not) on the third day after deposited with the United States Postal Service, postage prepaid, certified mail, return receipt requested, and addressed to the intended recipient at the address below. Notice may also be given by personal delivery or commercial courier delivery and will be effective when actually received. Any address for notice may be changed by written notice delivered to the other party as provided herein.

LANDLORD: TENANT:

City of San Angelo

Real Estate Division

72 W. College Ave.

San Angelo, Texas 76903

20. Entire Agreement. This Lease Agreement constitutes the entire agreement of the parties concerning the lease of the Premises by Landlord to Tenant. There are no representations, warranties, agreements, or promises pertaining to the lease of the Leased

Premises by Landlord to Tenant that are not in this Lease Agreement.

[Signature Page to Follow]

EXECUTED the day of , 2024

TENANT:

xxxxxxxxxxxx

LANDLORD:

Attest: CITY OF SAN ANGELO

By:

Heather Stastny, City Clerk Daniel Valenzuela, City Manager

Approved for Content: Approved for Content:

Shane Kelton, Executive Director of Sarah Tackett-Torres, Real Estate Manger

Public Works

Approved as to Form:

Brandon Dyson, City Attorney

Insurance Addendum to Lease

Lease Agreement

Date: January 1, 2026

Landlord: City of San Angelo, a home rule municipal corporation

Tenants: xxxxxxxxxx

This insurance addendum is part of the Lease.

Tenant agrees to—

1. Maintain the liability insurance policies required below (mark applicable boxes) during the Term and any period before or after the Term when Tenant is present on the Leased

Premises:

Type of Insurance Minimum Policy Limit

Commercial General Liability or equivalent Farm/Ranch Liability

Per occurrence: $150,000.00

Aggregate: $150,000.00

2. Comply with the following additional insurance requirements:

a. All liability policies must be endorsed to name Landlord as an “additional insured” on a form that does not exclude coverage for the sole or contributory ordinary negligence of Landlord and must not be endorsed to exclude the sole negligence of Landlord from the definition of “insured contract.”

b. Certificates of insurance and copies of any additional insured and waiver of subrogation endorsements must be delivered by Tenant to Landlord before entering the Leased Premises and thereafter at least ten days before the expiration of the policies.

[End of Insurance Addendum]

EXHIBIT “A”

MAP/LEGAL DESCRIPTION OF LAND