CIT A\5141711383040.2
LEASE AGREEMENT
BY AND BETWEEN
CITY OF ALAMEDA,
a charter city and municipal corporation
AS LANDLORD
and
PLAY HOUSE, LLC,
a California limited liability company
DBA DIRECTOR'S CUT
AS TENANT
TABLE OF CONTENTS
1. DEMISE ................................................................................................................................ 1
2. PREMISES ................................................................... ,,,,,,,, .................................. , ............... 1
2.1 Premises ......................... .-...................... H· ...................... ~ ..................... -............. ,-,,,;,;-, .. -, 1
2.2 Common Areas ........................................................................................................ 1
2.3 Possession .................. -.... -..... .-......... -.................. _,,,; ..................................................... 1
2.4 Landlord's Reserved Rights ............. oi ...... _ ..... ;., ......... _ ........... ~ .......... _ •• , ..... ~ .. ,,,._ ... ,_ ...... 2
3. TERM ................................................................................................................................... 2
3. I Term ........................................ ., ........................... : ....... ., .. ; .. , .................... ~ ... .-. .-.-............. 2
3.2 {Intentionally Omitted} ........................................................................................... 2
3.3 Option to Renew .......................................................... ,; .......................................... 3
4. RENT .................................................................................................................. 0 ................ ,5
4.1 Base Rent ........................................................................................................ , ......... 5
4.2 Additional Rent. .................................... , .................................................................. 5
4.3 Late Charge .......................................... , ....................... , ............................................ 5
4.4 Interest ..................................................................................................................... 5
5. OPERA TING EXPENSES AND TAXES .................................................................................... 6
5. I Definitions ........................... ;, ............ ., ........................... .,; ....................... :.,.; ... ;, ...... 6
5.2 Determination and Payment of Operating Expenses and Taxes .............................. 7 6, USE; COMPLIANCE WITH LAWS ......................................................................................... 8
6.1 Use ............................................................................................................................ 8
6.2 No Objectionable Odors, Fumes, Vapors or Gasses ................................................ 8
6.3 Covenant to Operate ................................................................................................ 8
6.4 Compliance with Laws ..................... , ...................................... :, ................................... 8
6.5 Use Permit ....................... ;;,,,, .................................. , ................................................. 9
7. SECURITY DEPOSIT ............................................................................................................. 9 8, UTILITIES ............................................................................................................................. 9
8.1 Payments for Utilities and Services ......................................................................... 9
8.2 No Liability ofLandlord ............................................. , ............... , ............................ 10
9. PERSONAL PROPERTY AND POSSESSORY INTEREST TAXES ............................................ 10
9.1 Tenant's Tax Obligation ........................................................................................... 10 CIT A\5 I 417\1383040.2
TABLE OF CONTENTS
(CONTINUED)
~
9.2 Personal Property Taxes ............... ; .. ,;; ................. ; .................... ; ... ;.;,,, ......... ; ......... 10
9.3 Possessory Interest Taxes ...................................................................................... 1 O
9.4 Payment ................................................................................................................. 10
10. AL'fERATIONS ............................................................................. _ ....................................... 11
10.1 Landlord Consent Required ................................................... , ... , ............ ; ............... !!
10.2 Alterations .................................................. , ................. , ... , ................ ; ..................... I I
10.3 Excavations ............................. ; ................................. ; ............................... , ............. 12
10.4 Liens .................................................................. , .... , ............................... , .............. 12
11. MAINTENANCE AND REPAIR OF PREMISES ...................................................................... 13
11.1 Maintenance and Repair by Tenant .......................................................................... 13
11.2 Maintenance and Repair by Landlord ................... , .......................... , .... \ .......... , ... ,., 14
12. ENVIRONMENTAL PROTECTION PROVISIONS .................................................................. 14
12.1 Hazardous Materials .............................................................................................. 14
12.2 Reportable Uses Required Consent ....... , .... , ......... , ....... , ... , ....................... , ............. 14
12.3 Remediation Obligations ....................................................................................... 15
12.4 Environmental Permits .......................................................................................... 16
12.5 Landlord's Inspection Right ............................................................... ;.;,;.;, ........... 16
12.6 Hazardous Materials Handling Plan ...................................................................... 16
12. 7 Hazardous Materials Indemnity ........................................... ,, ........ ,,. ................ , ..... 17
13. ASSIGNMENT AND SUBLETTING ........................................................................................ 17
13.1 Landlord Consent Required ................................................................................... 17
13.2 Landlord Recapture ............................................................................................... 17
13.3 Reasonable Consent ......................................................................... ,, .................... 18 13 .4 Transfer Premium ...................................... ., ..... , ..... , ............................................ , .. 18
13.5 Tenant Affiliates ........ ,.. ... ;.;,, .. , .. ;.,,;,;.,,.;, ................ , ... , .......... , ................... , .............. 19
13.6 No Release ............................................................................................................. 19
13.7 Expenses and Attorneys' Fees ................................................................................ 19
13.8 Limitations on Transfer Reasonable ...................................................................... 20
14. INDEMNITY AND W AIYER OF CLAIMS .............................................................................. 20
14. I Tenant Indemnification ... •.•-• .... ! ........ ···-~· '-'-"t· ., .... _ .•.• ,_ •• , ...... _ ...... , .•. ~ •• -.• _, ............... _.-.. _. ,',,,. .,,_20 CITA\51417\1383040.2 ii
TABLE OF CONTENTS
(CONTINUED)
14.2 Waiver of Claims ................................................................. .-.. ·.'•·····•····~··'""';·,;,· .. ·M,.,; ..... 20
14.3 Survival/No Impairment ...................... ""·'" 1·,·H•.u• .,. ••!•• ;"'··~·•····H; ~-..~. ;:• •.. ,. .. ,.,. ,-;.,·,·•-..-.... : .... ~ •• 21 '--;· - -, 15, INSURANCE. •••••••••H•••••••••••••••••••••oa .. •••••••ooooou~•••Ononoo100000•••••0ooooou1oo•uoooooouoHouo•oo1001oooo•oooo•21
15.1 Tenant's Insurance ................................................................................................. 21
15.2 Requirements For All Policies ............................................................................... 22
15.3 Certificates of Insurance ........................................................................... ,,,,, .. , .... '.22 15 .4 Landlord's Insurance .............. ,,;;,,; . ..-1 ...................... ,' •• -........ .-......... ,,,,,;, .. ,, •• ,-,, .. ·, ... ~ .... ,:,.• •• 22
16. DAMAGE OR DESTRUCTION .............................................................................................. 23
17. CONDEMNA1'ION ................................................................................................................ 23
18. DEFAULT ............................................................................................................................ 24
18.1 Events of Default .................................................................................................... 24 18 .2 Remedies ... , .... ,, .................. -..... _ ...... ., .... , ....... -. .-.,; .. ,; ...... ,.-...... , . .-.. -... ;; .... -..,, .. .-.-... .--.~- ...... .-.. 24
18.3 No Waiver ................................................................................. ,,,,,,,,,,,, ..... ,,,., ....... 25
18.4 Waiver of Redemption, Reinstatement, or Restoration .......................... ; ... ., ......... 25
18.5 Remedies Cumulative ............................................................................................. 26
18.6 Landlord's Right to Perform Tenant's Obligations , .... , .. ., .................... ,,. ... , .... ., .... 26
18.7 Severability ............................................................................................................ 26
19. LIMITATION OF LIABILITY ............................................................................................... 26
20. SURRENDER OF PREMISES. ••••••••••••••••• .. •••••••oo••• .. •• ............................................................ 27
21. HOLDING OVER ................................................................................................................. 27
22. MoRTGAGEs ...................................................................................................................... 27
22.1 Subordination to Mortgages .................................................................... , ............. 27
22.2 Mortgage Protection ................................................................................... , .......... 28
23. TENANT'S ESTOPPEL CERTIFICATE ................................................................................. 28
24. {INTENTIONALLY OMITTED} ............................................................................................ 28
25. NOTICE .............................................................................................................................. 28
26. LABOR PROVISIONS .......................................................................................................... 29
26.1 Equal Opportunity .................................... , ............................................................. 29
26.2 Convict Labor ....................................................................................................... .29
26.3 Prevailing Wages and Related Requirements ........................................................ 29 CJTA\51417\1383040.2 iii
TABLE OF CONTENTS
(CONTINUED)
27. MISCELLANEOUS ............................................................................................................... 30
27.1 Governing Law .............................................. ., ........ , .............. , ..... , ................... ,., .. 30
27.2 Severability ............................................................................................................ 30
27.3 Attorneys' Fees ..................................................................................................... ,30
27.4 Force Majeure ........................................................... ; ...... ;, .. ;,, ..•. ,.; ......................... 30
27.5 Sale ...................................... , ..... , ........................................................................... 31
27.6 Signs ............................... , ....................................... ,, ........ , ... , ...... ,, .......... , ............. 31
27.7 Brokers ............................................................................ , .................................... .,31
27.8 Access by Landlord ............................................................................................... 31
27.9 Waiver of Right to Jury Trial. ................................................................................ 32
27. I 0 Recordation ........................................................................................ ,0 .................. 32
27.11 Article and Section Titles ................................................................ ; ......................... 32
27.12 Authority ........................................................ , .. ,.,, ......................................... , .......... ;32
27.13 Quiet Possession ...................................................... , ............................................. 32
27.14 Guaranty ................................................................................................................ 33
27.15 OFAC Certification ..................... , ....................... ; ........................... · ....................... 33
27.16 Certified Access Specialist Disclosure ................................................................. ,33
27.17 Time of the Essence ..................................... ; ..... , .. , ........................................... , .... ,.33
27.18 Entire Agreement ........ , ... , ..... , ...... , ..................... , ........ , .......................................... 33
27.19 Financial Statement ............................................................................................... 33
27.20 Relocation Benefits ............................................................................................... .34
27.21 Counterparts ........................................................................................................... 34 CIT'A\5141711383040.2 iv
INDEX OF EXHIBITS
Exhibit
A PREMISES
B COMMENCEMENT LETTER
C RENEW AL NOTICE
D GUARANTY
CITA\5141711383040.2 v
LEASE AGREEMENT
BASIC LEASE INFORMATION
-- Lease Date: i_, 2018 for reference purposes only Dated as of ~ f'J.LJ I
Landlord: City of Alameda,
a charter city and municipal corporation
Landlord's Address: City of Alameda
Alameda City Hall
2263 Santa Clara Ave
Alameda, CA 94501
Tel: (510) 748-4509
Attn: City Manager
11 Notice Copy to:
11 RiverRock Real Estate Group, Inc., as Agent for
City of Alameda
950 W. Mall Square , suite 239
Alameda, CA 9450 l
Tel: (510) 749-0304
---·- Tenant: Play House, LLC, dba Director's Cut
-
Tenant's Address: 2319 Central A venue
i Alameda, CA 94501
\
Tel: (415) 269-5569
- ···--·
Premises: Those certain premises known as 2319 Central A venue, Alameda, CA, containing approximately 1,850 square feet as depicted in Exhibit A ..
Building: - -·-~ .. . ..
Historic Alameda Theatre Building
.. ..
Length of Term: 1
..
One Hundred Twenty (120) Months
Estimated Commencement Date:
June 1, 2018
Estimated Expiration Date: May 31, 2028
Extension Option: One (1) option to extend the Term for a period of five (5) years CITA\5141711383040.2 vi
Base Rent: Months Monthly Base Rent
I - 12 $ 6,530.50
·- --
13-24 $ 6,726.42
--
•
25-36 $ 6,928.21
..
----
. 37-48 $ 7,136.05
··.
49-60 $ 7,350.14
- --- -
61-72 $ 7,570.64
..
73-84 $ 7,797.76
·---- .. --··
85-96 $ 8,031.69
-·-·-·--··
97 -108 $ 8,272.64
------·- --
109-120 $8,520.82
. .
-
Taxes and Utilities: Tenant shall pay all costs for services and utilities to the Premises, as defined in the Leas.e. Tenant shall pay all taxes (including possessory interest taxes) levied on or against the Premises or its personal property.
-----~ ---·---~·
Tenant's Share: 5.31%
------ ---·-
Security Deposit; $13,061.00
-
Permitted Use: The Premises shall be used for a restaurant with service of alcoholic beverages to persons 21 years of age and over. - , .. ~---------------- ~··--··----
Guarantors: Husam Haddad and Joe Dabit
-·-·---·----------
Brokers: Cushman & Wakefield (Landlord Broker); TRI Commercial (Tenant Broker)
CJTA\51417\1383040.2 vii
LEASE AGREEMENT
THIS LEASE AGREEMENT is made and entered into by and between CITY OF ALAMEDA, a charter city and municipal corporation ("Landlord") and PLAY HOUSE, LLC, a California limited liability company, dba Director's Cut, ("Tenant"). The Basic Lease Information, the Exhibits and this Lease Agreement are and shall be construed as a single instrument and are referred to herein as the "Lease".
1. DEMISE.
1.1 Lease Agreement. In consideration for the rents and all other charges and payments payable by Tenant, and for the agreements, terms and conditions to be performed by Tenant in this Lease, and subject to City Council approval, Landlord does hereby lease to Tenant and Tenant does hereby hire and take from Landlord, the Premises described below, upon the agreements, terms and conditions of this Lease for the Term hereinafter stated.
1.2 Tennination of License. Tenant currently occupies the Premises under a License Agreement, dated March_, 2018 between the City as Licensor and Tenant as Licensee (the "License"). It is the intent of the parties hereto that the License shall be and is terminated as of the Lease Date specified in the Basic Lease Information, except those indemnification obligations which survive the termination of the License for claims occurring prior to the date of this Lease. Tenant's continued use and occupancy of the Premises shall be pursuant to the terms of this Lease.
2. PREMISES.
2.1 Premises. For and in consideration of the Payment of Rent (as defined in Article 4) and the perfo1mance of all of the covenants and conditions of this Lease, Landlord hereby leases and demises to Tenant, and Tenant hereby lease from Landlord, the Premises specified in the Basic Lease Information.
2.2 Common Areas. In addition to the Premises, Tenant shall have the non-exclusive right, in common with all other parties occupying the Building, to use the areas designated by Landlord as depicted in Exhibit A (the "Common Areas"). The use of the Common Areas shall be for the non-exclusive use of Tenant and Tenant's employees, agents, suppliers, customers and patrons, in common with Landlord and all other tenants of the Building and such other persons to whom Landlord has previously granted, or may hereinafter grant, rights of usage. Tenant shall not be entitled to use the Common Areas for storage of goods, vehicles, refuse or any other items. Landlord reserves the right to alter, modify, enlarge, diminish, reduce or eliminate the Common Areas from time to time in its sole discretion. If Tenant shall use any of the Common Areas for storage of any items, Tenant shall pay all fines and other charges imposed upon either Landlord or Tenant by any fue, building or other regulatory body, and Tenant shall pay all costs incurred by Landlord to clear that portion of the Common Areas so used by Tenant and dispose of such items.
2.3 Possession. Tenant accepts the Premises in "AS IS" "WITH ALL FAUL TS" condition and configuration without any representations or warranties by Landlord, and subject CITA\51417\1383040.2 I
to all matters of record and all applicable laws, ordinances, rules and regulations, with no obligation of Landlord to make alterations or improvements to the Premises. Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or wmrnnty with respect to the suitability of the Premises or Building for the conduct of Tenant's business. Landlord shall not be liable for any latent or patent defects in the Building or Premises. Tenant shall be responsible for requesting an inspection and obtaining a Certificate of Occupancy from the City of Almueda. This shall include, but is not limited to any necessary fire sprinkler upgrades, electrical service upgrades, compliance with the ADA (as defined at Section
6.2 below), and any other requirements mandated by the Certificate of Occupancy inspection.
2.4 Laqdlord 's Reserved Rights. Landlord hereby reserves the right, and at any time and from time to time, without the same constituting an actual or constructive eviction, to make alterations, additions, repairs, improvements to or in all or any part of the Building or Common Areas within and around the Building and to change the arrangement and/or location of entrances or passageways, doors and doorways, corridors, elevators, stairs, toilets and other public parts of the Building. Without limiting the foregoing, Landlord reserves the right from time to time to install, use, maintain, repair, relocate and replace pipes, ducts, conduits, wires, meters and equipment for services to the Premises or other part of the Building which are above the ceiling surfaces, below the floor surfaces, within the walls and in the central core areas of the Building which are located within the Premises or located elsewhere in the Building. In connection with any of the foregoing activities, Landlord shall use reasonable efforts to minimize any interference with Tenant's use of the Premises and shall not, without the prior written approval of Tenant, (a) materially change the location, size or configuration of the Premises; or (b) do anything which would have a material and adverse effect on access to the Premises, or ingress and egress to the Premises. No rights to any view or to light or air over any property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease.
3. TERM.
3.1 Term. The term of this Lease ("Term") shall be for the period specified in the Basic Lease Information, commencing on the later of (a) the Estimated Commencement Date or (b) one (I) day after this Lease has been approved by the City Council, at its sole and absolute discretion, the date of which approval shall be deemed to be the effective date of an ordinance approving this Lease as required by the City Charter ("Commencement Date"). This Lease shall terminate at midnight on the last day of the One Hundred Twentieth (!20th) full calendar month following the Commencement Date ("Expiration Date"), unless sooner terminated or extended as hereinafter provided. Promptly following the Commencement Date, Landlord and Tenant shall enter into a letter agreement substantially in the form attached hereto as Exhibit B, specifying and confirming the Commencement Date and the Expiration Date; ifTenant fails to execute and deliver such letter agreement to Landlord within ten (I 0) business days after Landlord's delivery of the same to Tenant, said letter agreement as completed by Landlord will be deemed final and binding upon Tenant.
3.2 {Intentionally Omitted}
CITA\5141711383040.2 2
3.3 Opt1on10 Renew.
(a) Renewal Opti<ins. Tenant shall have one (1) option to extend the Term (a "Renewal Option") for a period of five (5) years ("Renewal Term"). The Renewal Option may be exercised only by the entity identified as the Tenant in the Basic Lease Information or an assignee that is a Tenant Affiliate and may not be exercised by any other sublessee or assignee or by any other successor or assign. The Renewal Option shall be effective only if Tenant is not in Default under this Lease, either at the time of exercise of the Renewal Option or the time of commencement of the Renewal Term. Tenant shall exercise its Renewal Option, if at all, by written notice ("Election Notice") from Tenant to Landlord, in a form substantially the same as Exhibit C, given not more than twelve (12) months nor less than six (6) months prior to expiration of the initial Term. Any such notice given by Tenant to Landlord shall be irrevocable. If Tenant fails to exercise the Renewal Option in a timely manner as provided for above, said Renewal Option shall be void.
(b) Terms and Conditions. If Tenant exercises the Renewal Option, the Term shall be extended for an additional period of five (5) years upon the same terms and conditions as the initial Term except that (i) there shall be no further Renewal Options available to Tenant at the expiration of the Renewal Term, (ii) Tenant shall continue to occupy the Premises in its "as-is" condition without any tenant improvement allowance from Landlord, and (iii) the Base Rent during the Renewal Term (the "Renewal Rate") shall be an amount equal to the greater of (A) the "Fair Market Rent" prevailing at the commencement of said Renewal Term or (B) the Base Rent in effect at the end of the initial Term.
Tenant shall be responsible for all brokerage costs and/or finder's fees associated with Tenant's exercise of the Renewal Option made by parties claiming through Tenant.
Landlord shall be responsible for all brokerage costs and/or finder fees associated with Tenant's exercise of the Renewal Options made by parties claiming through Landlord. (c) Renewiil Rate. For purposes of this Section 3.3, "Fair Market Rent" means the prevailing rental rate per square foot then being obtained by landlords for comparable buildings or spaces located in the City of Alameda, taking into account (in either case) applicable base years, tenant improvement allowances, free rent periods and other tenant concessions, existing improvements and configuration of the space, any additional rent and all other payments and escalations payable hereunder and by tenants under leases of such comparable spaces as determined by the following process:
(i) Within thirty (30) days after Landlord's receipt of an Election Notice or as soon as thereafter as is reasonably practicable, Landlord shall notify Tenant in writing of the Renewal Rate ("Renewal Rate Notice"). (ii) Tenant shall have twenty (20) days ("Response
Period") after receipt of the Renewal Rate Notice to advise Landlord whether or not Tenant agrees with Landlord's determination of the Renewal Rate. If Tenant does not respond to Landlord in writing within the Response Period, then Tenant shall be deemed to have accepted the Renewal Rate specified by Landlord in the Renewal Rate Notice. If Tenant agrees or is CITA\5141711383040.2 3
deemed to have agreed with Landlord's determination of the Renewal Rate, then such determination shall be final and binding on the parties. (iii) If Tenant notifies Landlord in writing during the Response Period that Tenant disagrees with Landlord's determination of the Renewal Rate, then within twenty (20) days after Landlord's receipt of Tenant's written notice, Landlord and Tenant shall each retain a licensed commercial real estate broker with at least five (5) years' experience negotiating commercial lease transactions in the cities of Alameda and Oakland, California and Fair Market Rent shall be determined as follows:
A. If only one broker is appointed by the parties
during such period, then said broker shall, within twenty (20) days after his or her appointment, determine the Fair Market Rent.
B. If Landlord and Tenant each appoint a
broker during such period, then the brokers shall meet and confer during the thirty (30) day period commencing on the date on which the last of the brokers has been appointed ("Broker Negotiation Period") to attempt to mutually agree upon Fair Market Rent.
C. If the brokers cannot agree upon Fair Market
Rent as of the expiration of the Broker Negotiation Period, the two l>rokers shall, within twenty (20) days thereafter, attempt to select a third broker meeting the qualifications stated in this Section.
D. If the two brokers are unable to agree on the
third broker, either Landlord or Tenant, by giving fifteen (15) days written notice to the other party, can apply to then Presiding Judge of the Superior Court of Alameda County for the selection of a third broker who meets the qualifications stated in this paragraph.
E. Landlord and Tenant shall each bear one
half (1/2) cost of appointing the third broker and paying the third broker's fees.
F. The third broker, however selected, shall be
a person who has not previously acted in any capacity for either Landlord or Tenant. The third broker shall, within twenty (20) days after his or her appointment, make a determination of Fair Market Rent. The determinations of Fair Market Rent prepared by all three (3) brokers shall be compared and the Renewal Rent Rate shall be whichever of the determinations by Landlord broker or Tenant's broker is closer to the determination of the third broker (and if they are equally close, the Renewal Rate shall be the determination of the third broker). Such determination shall be final and binding upon the parties. Promptly following determination of a Renewal Rate pursuant to this Section, the parties shall execute an amendment to this Lease memorializing such Renewal Rate.
( d) Month Base Rent Increase. After the Renewal Rate has been determined for the first year of the Renewal Term, the Monthly Base Rent for the Premises shall increase at the annual rate of three percent (3%) throughout said Renewal Term.
CITA\5141711383040.2 4
4. RENT.
4.1 Base Rent.
(a) Generally. From and after the Commencement Date,
Tenant shall pay to Landlord, in advance of the first day of each calendar month, without any setoffor deduction and without further notice or demand, the monthly installments of rent specified in the Basic Lease Infonnation ("Base Rent"). One full installment of Monthly Base Rent shall be due and payable on the date of execution of this Lease by Tenant and shall be applied to the first full calendar month for which Monthly Base Rent is due. If the Commencement Date should be on a date other than the first day of a calendar month, the Monthly Base Rent installment paid for any fractional month during the Tenn shall be prorated based upon a thirty (30) day calendar month. Upon execution of this Lease, Tenant shall also pay to Landlord the amount of the Security Deposit as specified in the Basic Lease Information. (b) Abatement. Notwithstanding anything in this Article 4 to the contrary, so long as Tenant is not in Default hereunder, Tenant shall be entitled to an abatement of Base Rent for the first four (4) full calendar months of the Term (the "Abatement Period"). The total amount of Base Rent abated during the Abatement Period is referred to herein as the "Abated Base Rent". If Tenant is in Default hereunder at any time during the Term, (i) all previously Abated Base Rent shall immediately become due and payable and (ii) if such Default occurs prior to the expiration of the Abatement Period, there shall be no further abatement of Base Rent pursuant to this Section 4.l(b). The payment by Tenant of the Abated Base Rent in the event of a Default shall not limit or affect any of Landlord's rights pursuant to this Lease or at law or in equity.
4.2 Additional Rent. As used in this Lease, the tenn "Additional Rent" shall mean all sums of money, other than Base Rent, that are due and payable by Tenant under the terms of this Lease including, but not limited to, Tenant's share of Utilities in accordance with Article 8 of this Lease. The term "Rent," as used herein, shall mean all Base Rent, Additional Rent and all other amounts payable hereunder from Tenant to Landlord. Unless otherwise specified herein, all items of Rent other than Base Rent shall be due and payable by Tenant on or before the date that is thirty (30) days after billing by Landlord.
4.3 Late Cha1·ge. Other remedies for non-payment of Rent notwithstanding, ifany Monthly Base Rent installment or Additional Rent is not received by Landlord on or before the fifth (5th) day following the due date, or any payment due Landlord by Tenant which does not have a scheduled date is not received by Landlord on or before the thirtieth (30th) day following the date Tenant was invoiced for such charge, a late charge of five percent (5%) of such past due amount shall be immediately due and payable as Additional Rent.
4.4 lnteres4 Any installment of Rent and any other sum due from Tenant under this Lease which is not received by Landlord within five (5) days from when the same is due shall bear interest from the date such payment was originally due under this Lease until paid at the lesser of: (a) an annual rate equal to the maximum rate of interest permitted by law, or (b) ten percent (10%) per annum. Payment of such interest shall not excuse or cure any Default by Tenant.
CIT A\51417\1383040.2 5
5. OPERA TING EXPENSES AND TAXES.
5.1 Definitions. For purposes of this Article 5, the following terms shall have the meanings hereinafter set forth:
(a) Tenant's Share shall mean the percentage figure so
specified in the Basic Lease Information. The rentable area of the Premises specified in the Basic Lease Information is conclusive and binding upon Tenant. Tenant's Share has been computed by dividing the rentable area of the Premises by the total rentable area of the Building.
In the event that either the rentable area of the Premises or the total rentable area of the Building is changed or remeasured by Landlord (which Landlord shall have the right to do from time to time), Tenant's Share and the rentable area of the Premises and Building will be appropriately adjusted; and, as to the Tax and Expense Year in which s.uch change occurs, for purposes of this Article 5, Tenant's Share shall be determined on the basis of the number of days during such Tax and Expense Year that each such percentage is applicable. (b) Tax and Expense Year shall mean each twelve (12)
consecutive month period commencing July 1st and ending on June 30th of each year or partial year during the Term, provided that Landlord, upon notice to Tenant, may change the Tax and Expense Year from time to time (but not more frequently than once in any twelve (12) month period) to any other twelve (12) consecutive month period and, in the event of any such change, Tenant's Share of Taxes and Expenses shall be equitably adjusted for the Tax and Expense Years involved in any such change.
(c) Taxes shall mean all taxes, assessments, fees, impositions, assessments and charges levied (if at all) upon or with respect to the Building or Common Areas, any personal property of Landlord used in the operation of the Building, Common Areas or Landlord's interest in the Building or Common Areas or Land, other than Personal Property Taxes or Possessory Interest Taxes which are the subject of Article 9. Taxes shall include, without limitation and whether now existing or hereafter enacted or imposed, all general real property taxes, all general and special bonds and assessments, all charges, fees and levies for or with respect to transit (including any fees levied pursuant to a transportation demand management plan), housing, police, fire, flood control, infrastructure, or other governmental or quasi-governmental services or purported benefits to or burdens attributable to the Land or Building or any occupants thereof, all service payments in lieu of taxes, and any tax, fee or. excise on the act of entering into this Lease or any other lease of space in the Building or any occupants thereof, on the use or occupancy of the Building, on the rent payable under any lease or in connection with the business of renting space in the Building, th&t are now or hereafter levied or assessed against Landlord or the Building by the United States of America, the State of California, the City of Alameda, or any other political or public entity, and shall also include any other tax, fee or other excise, however described, that may now or hereafter be levied or assessed as a substitute for, or as an addition to, in whole or in part, any other Taxes, whether or not now customary or in the contemplation of the parties on the date of this Lease. Notwithstanding the foregoing, in the event Landlord has the right to elect to have assessments amortized over different time periods, Landlord will elect (or will charge such assessment through to Tenant as if Landlord had so elected) to have such assessment amortized over the longest period permitted by the assessing authority, and only the amortized portion of such assessment (with interest at the CITA\51417\1383040,2 6
lesser of the actual interest rate paid by Landlord or the then maximum rate of interest not prohibited or made usurious by Law) shall be included in Taxes on an annual basis .. Taxes shall not include any franchise, transfer or inheritance or capital stock taxes, or any income taxes measured by the net income of Landlord from all sources, unless due to a change in the method of taxation any such taxes are levied or assessed against Landlord as a substitute for, or as an addition to, in whole or in part, any other tax that would otherwise constitute a Tax. Taxes shall also include reasonable legal fees and other costs and disbursements incurred by Landlord in connection with proceedings to contest, determine or reduce Taxes provided, however, that Landlord shall pay to Tenant promptly after receipt by Landlord an amount equal to Tenant's Share of any refunded or recovered Tax previously paid by Tenant. ( d) Expenses shall mean all costs of management, operation, maintenance, insuring and repair of the (i) structural elements of the Building (including structural elements of the roof); (ii) Common Areas (including utilities supplied to Common Areas) and (iii) Landlord's property insurance, if any.
5.2 Determination and Payment ofOpchilihg E)(pensesat1dTaxes. Tenant shall pay to Landlord as Additional Rent one-twelfth (I/12th) of Tenant's Share of the Taxes and the Expenses for each Tax and Expense Year, or portion thereof, on or before the first day of each month during such Tax and Expense Year, in advance, in an amount estimated by Landlord set forth in an annual statement delivered by Landlord to Tenant; provided that Landlord shall have the right to revise such estimates not more than twice per Tax and Expense Year and Tenant shall thereafter make payments hereunder on the basis of such revised estimates. With reasonable promptness after the end of each Tax and Expense Year, Landlord shall submit to Tenant a statement showing the actual amount which should have been paid by Tenant with respect to Taxes and Expenses for the past Tax and Expense Year, the amount thereof actually paid during that year by Tenant and the amount of the resulting balance due thereof, or overpayment thereof, as the case may be ("Landlord's Statement"). Landlord's Statement shall set forth in reasonable detail, and shall contain a line-item breakdown showing at least the following major categories: (i) maintenance and repairs; (ii) landscaping; (iii) utilities (electricity; gas; water and sewer); and (iv) insurance. Any balance shown to be due pursuant to said statement shall be paid by Tenant to Landlord within thirty (30) days following Tenant's receipt thereof; and any overpayment shall be immediately credited against Tenant's obligation to make monthly payments for Taxes and Expenses for the then current Tax and Expense Year, or, if by reason of any termination of this Lease no such obligation exists, any such overpayment shall be refunded to Tenant. As an alternative to the monthly payment of Tenant's Share of Taxes and Expenses, and at Landlord's sole discretion, Landlord may direct Tenant to.pay, within thirty (30) days of Landlord's delivery of Landlord's Statement, the full annual amount set forth therein. If the Expiration Date shall occur on a date other than the last day of a Tax and Expense Year, Tenant's Share of Taxes and Expenses for the Tax and Expense Year in which the Expiration Date occurs shall be in the proportion that the number of days from and including the first day of the Tax and Expense Year in which the Expiration Date occurs to and including the Expiration Date bears to 365. Where the calculation of Expenses and Taxes for a Tax and Expense Year cannot be made until after expiration or termination of this Lease, the obligation of Tenant to pay its proportionate share as Additional Rent shall survive the expiration or termination hereof and such Additional Rent for such period shall be payable by Tenant upon demand by Landlord.
CIT AIS 1417\1383040.2 7
6. USE; COMPLIANCE WITH LAWS.
6.1 Use. The Premises shall be used for the Permitted use and for no other use whatsoever. At no time shall Tenant have the right to install, operate or maintain telecommunications or any other equipment on the roof or exterior areas of the Building, except as may be necessary for Tenant's Permitted Use of the Premises and Tenant's installation of such equipment is done in full compliance with Article 10. Tenant acknowledges that.neither Landlord nor any agent of Landlord has made any representation or warranty with respect to the Premises, Buildings or with respect to the suitability or fitness of either for the conduct Tenant's business or for any other purpose.
6.2 N<> Objectionable Odors, Futnes, VapOt'ilot Gasses. Tenant shall, at all times, maintain the Premises and conduct the business to be carried on by Tenant, so that no objectionable or offensive odors, fumes, vapors, or gasses of any kind shall emanate from the Premises, and Tenant fu1iher agrees, at Tenants own costs and expense, to maintain and keep installed, in good condition, any and all mechanical equipment operated and/or maintained by Tenant and, also at Tenant's own costs and expense, to keep installed, in good condition, a ventilation system; including such vents, filters, flues, ducts and fans as may be necessary to prevent any odors, fumes, vapors or gasses from escaping from the Premises to any other portion of the Building, including such equipment as may be required by any municipal or other governmental authority having jurisdiction. It is furthered agreed that if the ventilating system at any time installed in the Premises does not meet any standards set by any applicable governmental authority after the date hereof, Landlord may make any such changes as may be necessary at Tenant's sole cost and expense following the delivery of written notice thereof to Tenant and expiration of a fifteen (15) day cure period.
6.3 Covenant to Operate. Tenant hereby agrees to continuously operate its business in the Premises during the entire term hereof, subject to Force Majeure. Tenant, recognizing that the degree of success of the business in the Premises will depend upon Tenant's skill and efforts, agrees: (a) to devote Tenant's commercially reasonable efforts and judgment towards the operation of its business in the Premises, (b) to keep the full service restaurant and bar open for business at least forty ( 40) hours per week; and ( c) to carefully supervise and control the operation of its business in the Premises and to employ a competent and adequate staff therefore (all of whom shall be Tenant's employees and none of whom shall be deemed for any purpose whatsoever to be Landlord's employees).
6.4 Compliance with Laws. Tenant shall comply with all laws, ordinances, rules, regulations and codes, of all municipal, county, state and federal authorities, including the Americans With Disabilities Act, as amended, (42 U.S.C. Section 1201 et seq. [the "ADA"]) (collectively, "Laws") pertaining to Tenant's use and occupancy of the Premises and the conduct of its business. Tenant shall be responsible for making all improvements and alterations necessary to bring the Premises into compliance with applicable ADA requirements, including correcting any construction-related accessibility standards within the Premises, and to ensure that the Premises remain in compliance throughout the Term of this Lease. Tenant shall also comply with the California Alcoholic Beverage Control Act and all related regulations and statutes.
Tenant shall not commit, or suffer to be committed, any waste upon the Premises or any public or private nuisance, or other act or thing which disturbs the quiet enjoyment of any other tenant CIT AIS 141711383040.2 8
in the Building, nor shall Tenant store any materials on the Premises which are visible from areas adjacent to the Premises, unless otherwise specifically set forth in this lease. Tenant shall ensure that the Premises remain free from infestation from rodents or insects. Tenant shall not do or permit anything to be done on or about the Premises or bring or keep anything into the Premises which will in any way increase the rate of, invalidate, or prevent the procuring of any insurance, protecting against loss or damage to the Buildings or any of its contents by fire or other casualty or against liability for dal]'lage to property or injury to person in or about the Buildings.
6.5 Use Permit. Tenant and any of its subtenants shall maintain a City of Alameda Use Permit and other applicable City permits and approvals for the intended use of the Premises (collectively "Use Permit").
7. SECURITY DEPOSIT.
Landlord presently holds a security deposit under the License which, upon ratification of this Lease, shall be credited against the amount of the Security Deposit required herein. Concurrently with its execution of this Lease, Tenant shall deliver to Landlord the amount identified in the Basic Lease Information as the Security Deposit and the amount presently held under the License, any difference between to be held by Landlord without liability for interest (unless required by Law) as security for the performance of Tenant's obligations.
The Security Deposit is not an advance payment of Rent or a measure of damages. Landlord may from time to time and without prejudice to any other remedy provided in this Lease or by Law, use all or a portion of the Security Deposit to the extent necessary to satisfy past due Rent or to satisfy Tenant's Default under this Lease or to reimburse or compensate Landlord for any liability, expense, loss or damage which Landlord may suffer or incur by reason thereof. If Landlord so uses or applies all or any portion of the Security Deposit, then within fifteen (IS) days after demand therefore, Tenant shall deposit cash with Landlord in an amount sufficient to restore the deposit to the full amount thereof, and Tenant's failure to do so shall constitute a Default under this Lease. If there are no payments to be made from the Security Deposit as set out in this paragraph, or if there is any balance of the Security Deposit remaining after all payments have been made, the Security Deposit, or such balance thereofremaining, will be refunded to the Tenant after the expiration or earlier termination of this Lease. Tenant hereby waives the benefit of the provisions of California Civil Code Section 1950.7. In the event of an act of bankruptcy by or insolvency of Tenant or the appointment of a receiver for Tenant or general assignment for the benefit of Tenant's creditors, the Security Deposit shall be deemed immediately assigned to Landlord.
8. UTILITIES.
8.1 Payments for Utilities and Services, Tenant shall contract directly with the providers of, and shall pay all charges for, water, sewer, storm water, gas, electricity, heat, cooling, telephone, refuse collection, janitorial, pest control, security and monitoring services furnished to the Premises, together with all related installation or connection charges or deposits ("Utilities"). If any Utilities are provided by Alameda Municipal Power ("AMP") it is understood and agreed that such entity is separate and distinct from Landlord and Tenant must contract directly with AMP for any such Utilities. If any such Utilities are not separately metered or billed to Tenant for the Premises but rather are billed to and paid by Landlord, Tenant CITA\51417\1383040.2 9
shall pay to Landlord, as Additional Rent, its pro rata share of the cost of such ser¥ices, as reasonably determined by Landlord. If any Utilities are not separately metered, Landlord shall have the right to determine Tenant's consumption by either submetering, survey or other methods designed to measure consumption with reasonable accuracy.
8.2 No LiabilityofLandlOl'd. Except in the case of Landlord's gross negligence or willful misconduct, in no event shall Landlord be liable or responsible for any loss, damage, expense or liability, including, without limitation, loss of business or any consequential damages, arising from any failure or inadequacy of any service or Utilities provided to the Premises or Buildings, whether resulting from any change, failure, interference, disruption or defect in supply or character of the service or Utilities provided to the Premises or Building, or arising from the partial or total unavailability of the service or utility to the Premises or Buildings, from any cause whatsoever, or otherwise, nor shall any such failure, inadequacy, change, interference, disruption, defect or unavailability constitute an actual or constructive eviction of Tenant, or entitle Tenant to any abatement or diminution of Rent or otherwise relieve Tenant from its obligations under this Lease.
9. PERSONAL PROPERTY AND POSSESSORY INTEREST TAXES.
9.1 Tenant's Tax Obligation. "Taxes" shall mean all taxes, assessments and governmental charges, whether federal, state, county or municipal, and whether general or special, ordinary or extraordinary, foreseen or unforeseen, imposed upon Tenant's personal property or trade fixtures, the Premises, or any possessory interest therein, or their operation, whether or not directly paid by Landlord, but excluding those Taxes paid by Landlord as defined at Section 5.l(c) above.
9.2 Personal Propel'ly Taxes. Tenant shall pay all Taxes (as hereinafter defined) levied or imposed against the Premises or Tenant's personal property or trade fixtures placed by Tenant in or about the Premises during the Te1m ("Personal Property Taxes").
9.3 POssessory Interest Taxes. The interest created by this Lease may at some time be subject to property taxation under the laws of the State of California. If property taxes are imposed, the party in whom the possessory interest is vested may be subject to the payment of the taxes levied on such interest. This notice is included in this Lease pursuant to the requirements of section 107.6 (a) of the Revenue and Taxation Code of the State of California.
9.4 Payment. Tenant shall pay the Personal Property Taxes or possessory interest taxes in accordance with the instructions of the taxing entity. Tenant shall pay the Personal Property Taxes, if any, originally imposed upon Landlord, upon Landlord's election, either (a) annually within thirty (30) days after the date Landlord provides Tenant with a statement setting forth in reasonable detail such Taxes, or (b) monthly in advance based on estimates provided by Landlord based upon the previous year's tax bill. All Personal Property Taxes originally imposed upon Landlord and payable by Tenant with respect to the Premises shall be prorated on a per diem basis for any partial tax year included in the Term. Tenant's obligation to pay Taxes during the last year of the Term shall survive the expiration or termination of this Lease.
CIT A\5141111383040.2 10
10, ALTERATIONS.
10.1 Landlord Consent Required. Tenant shall not make any alterations, improvements, or additions (each an "Alteration") in or about the Premises or any part thereof without the prior written consent of Landlord, which consent may be reasonably conditioned upon criteria and/or requirements deemed necessary by Landlord in its proprietary capacity only; provided, however, that Landlord shall have the right in its sole and absolute discretion to withhold its consent to any Alterati.on which affects the structural components of the Building, including the roof, support structures, foundations, the exterior of the Building and/or the systems serving the Premises or the Building. Any such approval by Landlord shall be in its proprietary capacity as Landlord and no such approval shall be deemed an approval by the City of Alameda in its regulatory capacity. Notwithstanding the foregoing, Tenant shall have the right to make Alterations to the Premises with prior written notice to, but without the consent of, Landlord provided that such Alterations (a) do not require the procurement of a building permit, (b) do not affect the structural portion of the Building or the systems serving the Building, (c) the reasonably estimated costs of the Alternations, together with the costs of any other Alteration made during the immediately preceding twelve (12) months period, do not exceed Ten Thousand Dollars ($18,000) and, (d) are performed in full compliance with the terms Sections 10.2 through
10.4 below.
10.2 Alterations. Any Alterations to the Premises shall be at Tenant's sole cost and expense, and made in compliance with all applicable Laws and all reasonable requirements requested by Landlord. Prior to starting work, Tenant shall furnish Landlord with plans and specifications (which shall be in CAD format if requested by Landlord); names of contractors reasonably acceptable to Landlord; required permits and approvals; evidence of contractors and subcontractors insurance in amounts reasonably required by Landlord and naming Landlord, the managing agent for the Building and such other persons or entities as Landlord may reasonably request, as additional insureds; and any security for payment in performance and amounts reasonably required by Landlord. In addition, if any such Alteration requires the removal of asbestos, an appropriate asbestos disposal plan, identifying the proposed disposal site of all such asbestos, must be included with the plans and specifications provided to Landlord. Tenant shat.I reimburse Landlord for any sums paid by Landlord for third party examination of Tenant's plans for Alterations. Landlord agrees to respond to Tenant's request for consent to any Alterations within fifteen (15) days following Tenant's delivery of such request, accompanied by plans and specifications depicting the proposed Alterations ("Plans") and a designation of Tenant's general contractor (and ma,jor subcontractors) to perform such work. Landlord's response shall be in writing and, if Landlord withholds its consent to any Alterations, Landlord shall specify in reasonable detail in Landlord's notice of disapproval, the basis for such disapproval. If Landlord fails to timely notify Tenant of Landlord's approval or disapproval of any such Plans, Tenant shall have the right to provide Landlord with a second written request for approval (a "Second Request") that specifically identifies the applicable Plans and contains the following statement in bold and capital letters: "THIS IS A SECOND REQUEST FOR APPROVAL OF PLANS PURSUANT TO THE PROVISIONS OF SECTION 10.2 OF THE LEASE. If Landlord fails to respond to such Second Request within five (5) business days after receipt by Landlord, the Plans in question shall be deemed disapproved by Landlord. If Landlord disapproves of any Plans, Tenant may revise Tenant's Plans and resubmit such Plans to Landlord; in such event the scope of Landlord's review of such Plans shall be limited to Tenant's correction of the items to CIT A\51417\1383040.2 11
which Landlord had previously objected. Landlord's review and approval (or deemed approval) of such revised Plans shall be governed by the provisions as set forth above in this Section 10.2.
The procedure set forth above for approval of Tenant's Plans will also apply to any change, addition or amendments to Tenant's Plans. Landlord's approval of an Alteration shall not be deemed a representation by Landlord that the Alteration complies with Law. In addition, Tenant shall pay Landlord a fee for Landlord's oversight and coordination of any Alteration equal to five percent (5%) of the total costs of the Alteration, to the extent the costs of the Alteration is equal to or less than $100,000; plus four percent (4%) of the costs of the Alteration to the extent that the costs of the Alteration is in excess of$100,000, but not more than $500,000; plus three percent (3%) of any portion of the costs of the Alteration in excess of$500,000. Upon completion, Tenant shall furnish Landlord with at least three (3) sets of"as built" Pl!lls (as well as a set in CAD format, if requested by Landlord) for the Alterations, completion affidavit and full and final unconditional waivers of liens and will cause a Notice of Completion to be recorded in the Office of the Recorder of the County of Alameda. Any Alteration shall at once become the property of Landlord; provided, however, that Landlord, at its option, may require Tenant to remove any Alterations prior to the expiration or sooner termination of this Lease. If Tenant serves a request in writing together with Tenant's request for Landlord's consent to any such Alterations ("Removal Request"), Landlord will notify Tenant at the time of Landlord's consent to any such Alterations as to whether Landlord requires their removal. All costs of any Alterations (including, without limitation, the removal thereof, ifrequired) shall be borne by Tenant. If Tenant fails to promptly complete the removal of any Alterations and/or to repair any damage caused by the removal, Landlord may do so and may charge the reasonable costs thereof to Tenant. All Alterations shall be made in a good and workmanlike manner and in a manner that will not disturb other tenants, in accordance with Landlord's then-current guideline for construction, and Tenant shall maintain appropriate liability and builders' risk insurance throughout the construction. Tenant shall indemnify, defend, protect and hold Landlord harmless from and against any and all claims for injury to or death of persons or damage or destruction of property arising out of or relating to the performance of any Alterations by or on behalf of Tenant. Under no circumstances shall Landlord be required to pay, during the Term (as the same may be extended or renewed) any ad valorem or other Taxes on such Alterations, Tenant hereby covenanting to pay all such taxes when they become due.
10.3 Excavations. In the event Tenant intends to perform any Alterations requiring excavations below the surface of the Premises (whether inside or outside of the Buildings) or construction of a permanent structure on the Premises, Tenant must determine the actual location of all utilities using standard methods (i.e., potholing, metal fish line, etc.) and submit this information with an application to excavate or application to build a permanent structure to Landlord for approval (which shall also include the approval of other applicable governmental authorities). The application shall include a site plan showing the location of utilities and that construction will not take place above the utility line or within the utility easement, specifically showing that no permanent structure will be constructed in these areas.
10.4 Liens. Tenant shall pay when due all claims for labor or materials furnished Tenant for use in the Premises. Tenant shall not permit any mechanic liens, stop notices, or any other liens against the Premises, Building, Alterations or any of Tenant's interests under this Lease for any labor or materials furnished to Tenant in connection with work performed on or about the Premises by or at the direction of Tenant. Tenant shall indemnify, hold harmless and CITA\51417\1383040.2 12
defend Landlord (by counsel reasonably satisfactory to Landlord) from any liens and encumbrances arising out of any work performed or materials furnished by or at the direction of Tenant. In the event that Tenant shall not, within ten (10) days following the imposition of any such lien or stop notice, cause such lien or stop notice to be released of record by payment or posting of a proper bond, Landlord shall have, in addition to all other remedies provided herein or by law, the right, but not the obligation, to cause the same to be released by such means as it may deem proper, including payment of the claim giving rise to such lien. All.such sums paid by Landlord and expenses reasonably incurred in connection therewith, including attorneys' fees and costs, shall be payable to Landlord by Tenant on demand. 11, MAINTENANCE AND REPAIR OF PREMISES.
11.1 Maintenance and Repair by 'renanl,
(a) Tenant Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in good repair and in a neat and clean, first-class condition, including making all necessary repairs and replacements. Tenant's repair and maintenance obligations include, without limitation, repairs to: (i) floor coverings; (ii) interior partitions; (iii) doors; (iv) the interior side of demising walls; (v) fire life safety systems, including sprinklers, fire alarms and/or smoke detectors; (vi) Alterations, described in Article 10; (vii) heating, ventilation and air conditioning (HV AC) systems exclusively serving the Premises; (viiix) kitchens; (ix) plumbing and similar facilities exclusively serving the Premises, whether such items are installed by or on behalf of Tenant or are currently existing at the Premises; and (x) telephone and data equipment, and cabling. Tenant, at its sole cost and expense, shall procure and maintain in full force and effect a contract for the maintenance of any grease traps, including the treatment, emptying and flushing thereof, with a service and maintenance firm reasonably acceptable to Landlord. Tenant shall follow all reasonable recommendations of said contractor for the maintenance of the grease traps, including any recommended chemical treatments and any recommended intervals for the emptying and/or hydrojetting of the grease traps and connecting pipes. The service contract shall provide that the contractor shall empty the grease trap and perform such other necessary maintenance at an interval of not less than one (1) time every 60 days. Landlord shall have the right to oversee any work performed by such contractor. Tenant, as Additional Rent, shall be liable for the cost of any maintenance to or repairs of any of the Building pumps, pipes or sewer laterals as a resul.t of Tenant's failure to comply with the terms and conditions of this provision or as a result of any grease, garbage or other abnormal disposal through the Building drain system by Tenant. (b) Tenant Repair. Tenant shall further, at its own costs and expense, repair or restore any damage or injury to all or any part of the Building caused by Tenant or Tenant's agents, employees, invitees, licensees, visitors or contractors, including but not limited to repairs or replacements necessitated by (i) the construction or installation of improvements to the Premises by or on behalf of Tenant; (ii) the moving of any property into or out of the Premises; or Tenant's use and occupancy of the Premises. If Tenant fails to make such repairs or replacement within fifteen (15) days after notice from Landlord, then Landlord may, at its option, upon prior reasonable notice to Tenant (except in an emergency) make the required repairs and replacements and the costs of such repairs or replacement (including Landlord's CIT A\5141711383040.2 13
administrative charge) shall be charged to Tenant as Additional Rent and .shall become due and payable by Tenant with the monthly installment of Base Rent next due hereunder.
11.2 Maintenance and Repair by LandlorcL Landlord shall maintain in good repair (i) the structural elements of the Building, including structural elements of exterior walls and foundations and the roof, but excluding any glass and exterior doors; and (ii) Common Areas, if any, provided such repairs are not necessitated by the actions or inactions of Tenant, Tenant's invitees or anyone in the employ or control of Tenant. Tenant hereby waives any and all rights under and benefits of subsection 1 of Section 1932, and Sections 1941and1942 of the California Civil Code or any similar or successor Laws now or hereby in effect. Tenant shall immediately give Landlord written notice of the need for repair of the items for which Landlord is responsible. If Tenant or Tenant's invitees or anyone in the employed or control of Tenant caused any damages necessitating such repair, then Tenant shall pay to Landlord the cost thereof, immediately upon demand therefor. Except as otherwise expressly set forth in this Lease, Tenant waives any right to terminate this Lease or offset or abate Rent by reason of any failure of Landlord to malce repairs to the Premises or Building.
12. ENVIRONMENTAL PROTECTION PROVISIONS.
12.1 Hazardous Materials. "Hazardous Materials" shall mean any material, substance or waste that is or has the characteristic of being hazardous, toxic, ignitable, reactive, flammable, explosive, radioactive or corrosive, including, without limitation, petroleum, solvents, lead, acids, pesticides, paints, printing ink, PCBs, asbestos, materials commonly known to cause cancer or reproductive harm and those materials, substances and/or wastes, including wastes which are or later become regulated by any local governmental authority, the state in which the Premises are located or the United States Government, including, but not limited to, substances defined as "hazardous substances," "hazardous materials," ''toxic substances" or "hazardous wastes" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §9601, et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. §1801, et seq.; the Resource Conservation and Recovery Act; all environmental laws of the state where the Premises are located, and any other environmental law, regulation or ordinance now existing or hereinafter enacted. "Hazardous Materials Laws" shall mean all present and future federal, state and local laws, ordinances and regulations, prudent industry practices, requirements of governmental entities and manufacturer's instructions relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture, storage, presence, disposal or transportation of any Hazardous Materials, including without limitation the laws, regulations and ordinances referred to in the preceding sentence.
12.2 Reportable Uses Required Consent. Except as pennitted in this Article 12, Tenant hereby agrees that Tenant and Tenant's officers, employees, representatives, agents, contractors, subcontractors, successors, assigns, subtenants, concessionaires, invitees and any other occupants of the Premises (for purposes of this Article 12, referred to collectively herein as "Tenant Parties") shall not cause or permit any Hazardous Materials to be used, generated, manufactured, refined, produced, processed, stored or disposed of, on, under or about the Premises or Building or transported to or from the Premises or Building without the express prior written consent of Landlord, which consent may be limited in scope and predicated on strict compliance by Tenant with all applicable Hazardous Materials Laws and such other reasonable CITA\5141711383040.2 14
rules, regulations and safeguards as may be required by Landlord (or any insurance carrier, environmental consultant or lender of Landlord, or environmental consultant retained by any lender of Landlord) in connection with using, generating, manufacturing, refining, producing, processing, storing or disposing of Hazardous Materials on, under or about the Premises or the Building. In connection therewith, Tenant shall, at its own expense, procure, maintain in effect and comply with all conditions of any and all permits, licenses and other governmental and regulatory approvals required for the storage or use by Tenant or any of Tenant Parties of Hazardous Materials on the Premises or the Building, including without limitation, discharge of (appropriately treated) materials or wastes into or through any sanitary sewer serving the Premises or the Building. The foregoing notwithstanding, Tenant may use ordinary and customary materials reasonably required to be used in the course of the Permitted Use, ordinary office supplies (copier, toner, liquid paper, glue, etc.) and common household cleaning materials, so long as such use is in compliance with all Hazardous Materials Laws and does not expose the Premises or neighboring property to any meaningful risk of contamination or damage or expose Landlord to any liability therefor.
12.3 Remediation Obligations. If at any time during the Term, any contamination of the Premises by Hazardous Materials shall occur where such contamination is caused by the act or omission of Tenant or Tenant Parties ("Tenant's Contamination"), then Tenant, at Tenant's sole cost and expense, shall promptly and diligently remediate such Hazardous Materials from the Premises or the groundwater underlying the Premises to the extent required to comply with applicable Hazardous Materials Laws. Tenant shall not take any required remedial action in response to any Tenant's Contamination in or about the Premises or enter into any settlement agreement, consent, decree or other compromise in respect to any claims relating to any Tenant's Contamination without first obtaining the prior written consent of Landlord, which may be subject to conditions imposed by Landlord as determined in Landlord's sole discretion. Such prior written consent shall not be required to the extent the delay caused by the requirement to obtain consent may increase the damage to the Premises or the risk of harm to human health, safety, the environment or security caused by the Tenant's Contamination. Landlord and Tenant shall jointly prepare a remediation plan in compliance with all Hazardous Materials Laws and the provisions of this Lease. In addition to all other rights and remedies of Landlord hereunder, if Tenant does not promptly and diligently take all steps to prepare and obtain all necessary approvals ofa remediation plan for any Tenant's Contan1ination, and thereafter commence the required remediation of any Hazardous Materials released or discharged in connection with Tenant's Contamination within thirty (30) days after all necessary approvals and consents have been obtained, and thereafter continue to prosecute such remediation to. completion in accordance with the approved remediation plan, then Landlord, at its sole discretion, shall have the right, but not the obligation, to cause such remediation to be accomplished, and Tenant shall reimburse Landlord within fifteen (15) business days of Landlord's demand for reimbursement of all amounts reasonably paid by Landlord (together with interest on such amounts at the highest lawful rate until paid), when such demand is accompanied by proof of payment by Landlord of the amounts demanded. Tenant shall promptly deliver to Landlord, copies of hazardous waste manifests reflecting the legal and proper disposal of all Hazardous Materials removed from the Premises as part of Tenant's remediation of any Tenant's Contamination. The foregoing notwithstanding, "Tenant's Contamination" shall not refer to or include any Hazardous Materials that were not introduced to the Premises by Tenant or Tenant Parties. As an example, iflead dust or asbestos are found on the Premises, unless there is evidence that Tenant CIT A\5141711383040.2 15
introduced those Hazardous Materials to the Premises or they were dislodged by a Tenant Alteration, those Hazardous Materials shall not be considered "Tenant's Contamination," and it shall not be Tenant's responsibility to" take remedial action relating to such Hazardous Materials.
12.4 Environmental Permits. Tenant and Tenant Parties shall be solely responsible for obtaining and complying with, at their cost and sole expense, any environmental permits required for Tenant's operations under this Lease, independent of any existing permits held by Landlord. Tenant shall not conduct operations or activities under any environmental permit that names Landlord as a secondary discharger or co-permittee. Tenant shall provide prior written notice to Landlord of all environmental permits and permit applications required for any of Tenant's operations or activities. Tenant acknowledges that Landlord will not consent to being named a secondary discharger or co-permittee for any operations or activities of Tenant, its contractors, assigns or subtenants. Tenant shall strictly comply with any and all environmental permits (including any hazardous waste permit required under the Resource Conservation and Recovery Act or its state equivalent) and must provide, at its own expense, any hazardous waste management facilities complying with all Hazardous Material Laws.
I 2.5 Landlord's Inspection Right. Landlord shall have the right to inspect, upon reasonable notice to Tenant, the Premises for Tenant's compliance with this Article 12.
Landlord normally will give Tenant twenty-four (24) hours' prior notice of its intention to enter the Premises unless it determines the entry is required for exigent circumstances related to health, safety, or security; provided, however, Landlord agree to use its best commercial efforts to provide Tenant with the maximum advance notiee of any such entrance and will, without representation or warranty, attempt to structure such entrance in the least intrusive manner possible. Tenant shall have no claim against Landlord, or any officer, agent, employee, contractor or subcontractor of Landlord by reason of entrance of such Landlord officer, agent, employee, contractor or subcontractor onto the Premises.
12.6 Hazardous Mate1'ials Handling Plan. Prior to the execution of this Lease, Tenant shall complete, execute and deliver to Landlord an Environmental Questionnaire Disclosure Statement (the "Environmental Questionnaire"), in the form of Exhibit E attached hereto and shall require any Subtenant who will bring to, or use at the Premises, any Hazardous Materials to also execute and deliver to Landlord an Environmental Questionnaire. To the extent Tenant intends to store, use, treat or dispose of Hazardous Materials on the Premises, Tenant shall prepare and submit together with the Environmental Questionnaire a Hazardous Materials Handling Plan (the "Hazardous Materials Handling Plan"). For a period of fifteen (15) days following Landlord's receipt of the Environmental Questionnaire and Hazardous Materials Handling Plan, if applicable, Landlord shall have the right to approve or disapprove such documents. The failure of Landlord to approve such documents shall be deemed Landlord's disapproval thereof. Landlord approval of the Environmental Questionnaire and the Hazardous Materials Handling Plan shall constitute approval for Tenant's use of the Hazardous Materials set forth therein in compliance with Hazardous Materials Laws and the Hazardous Materials Handling Plan. Following approval of the Hazardous Materials Handling Plan, Tenant shall comply therewith tiu·oughout the Term. To the extent Tenant is permitted to utilize Hazardous Materials upon the Premises, such use shall be limited to the items set forth in the Environmental Questionnaire, shall comply with Hazardous Materials Laws and the Hazardous Materials Handling Plan and Tenant shall promptly provide Landlord with complete and legible copies of CITA\5141711383040.2 16
all the following environmental items relating thereto: reports filed pursuant to any self-reporting requirements; permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents relating to water discharges, air pollution, waste generation or disposal, and underground storage tanks for hazardous materials; orders, reports, notices, listing and correspondence of or concerning the release, investigation of, compliance, cleanup, remedial and corrective actions, and abatement of hazardous materials; and all complaints, pleadings and other legal documents filed by or against Tenant related to Tenant's use, handling, storage or disposal of Hazardous Materials. If, in conjunction with Tenant's Permitted Use of the Premises, Tenant desires to commence the use, treatment, storage or disposal of previously undisclosed Hazardous Materials, prior to such usage thereof, Tenant shall notify Landlord thereof, by written summary detailing the scope of such proposed usage and updating the Hazardous Materials Handling Plan to the extent required by such proposed usage. For a period of fifteen (15) days following Landlord's receipt of such notice, Landlord shall have the right to approve or disapprove of such documents.
The failure of Landlord to approve of such documents within such time period shall be deemed Landlord's disapproval thereof.
12.7 Hazardous Materiuls Indemnity. In addition to any other provisions of this Lease, Tenant shall, and does hereby agree, to, indemnify and hold harmless Landlord from any costs, expenses, liabilities, fines or penalties resulting from discharges, emissions, spills, storage or disposal arising from Tenant's occupancy, use or operations, or any other action by Tenant or its contractors, employees, agents, assigns, invitees, or subtenants giving rise to liability, civil or criminal, or any other action by Tenant or its contractors, employees, agents, assigns, or subtenants giving rise to responsibility under any Hazardous Materials Laws. Tenant's obligations hereunder shall apply whenever Landlord incurs costs or liabilities for Tenant's activities or fi:ir the activities of Tenant's contractors, employees, agents, assigns, invitees, or subtenants as provided hereunder. This provision shall survive the expiration or termination of this Lease.
13. ASSIGNMENT AND SUBLETTING.
13.1 Lundlmd Consent Requireg. Subject to Sections 13.5 and 13.6 below, Tenant shall not voluntarily or by operation oflaw, (a) mortgage, pledge, hypothecate or encumber this Lease or any interest therein, or (b) assign or transfer this Lease or any interest herein, sublease the Premises or any part thereof or any right or privilege appurtenant thereto, or allow any other person (the employees and invitees of Tenant excepted) to occupy or use the Premises, or any portion thereof, without first obtaining the written consent of Landlord, which consent shall not be withheld unreasonably provided that (i) Tenant is not then in Default under this Lease nor is any event then occurring, with the giving of notice or the passage of time, or both, would constitute a Default hereunder, and (ii) Tenant has not previously assigned or transferred this Lease or any interest herein or subleased the Premises or any part thereof. A transfer of greater than fifty percent (50%) interest (whether stock, partnership interest, membership interest or otherwise) of Tenant, either in one (1) transaction or a series of transaction shall be deemed to be an assignment under this Lease.
13.2 Landlord Rcmmture. In the event of an assignment of this Lease or subletting of more than twenty percent (20%) of the rentable square footage of the Premises, Landlord shall CIT A\5 J 41111383040.2 17
have the right to recapture the portion of the Premises that Tenant is proposing to transfer. If Landlord exercises its right to recapture, this Lease shall automatically be amended (or terminated ifthe entire Premises is being assigned or sublet) to delete the applicable portion of the Premises effective on the proposed effective date of the Transfer, although Landlord may require Tenant to execute a reasonable amendment or other document reflecting such reduction or termination.
13.3 Reasonable Consent, If Tenant intends to assign this Lease or sublet the Premises or any part thereof, Tenant shall give Landlord written notice of such intent ("Transfer Notice").
Tenant's Transfer Notice shall be accompanied by a copy of the proposed assignment or sublease between Tenant and the proposed assignee or subtenant, together with current and three (3) years' prior financial statements, if available, for the proposed assignee or subtenant, which financial statement shall be prepared in accordance with generally accepted accounting principles. Tenant shall provide Landlord with any additional information or documentation reasonably requested by Landlord within ten (10) business days after receiving Landlord's request. Landlord shall then have a period of thirty (30) days following receipt of such additional information (or 30 days after receipt of Tenant's Transfer Notice if no additional infmmation is requested) within which to notify Tenant in writing that Landlord elects either (a) to exercise its recapture rights in accordance with Section 13.2 in which event Tenant will be relieved of all further obligations hereunder as to such space as of the date specified in Landlord's notice terminating the Lease with respect to the relevant space, (b) to permit Tenant to assign this Lease or sublet such space as described in the Transfer Notice, subject, however, to prior written consent to the proposed assignment or sublease or (c) deny Tenant's request to assign this Lease or sublet such space. Among other factors upon which Landlord may base a withholding of consent are the following: (i) the use of the Premises by such proposed assignee or subtenant would not be a Permitted Use; (ii) the financial condition of the proposed assignee or subtenant is such that, in Landlord's reasonable determination, it would be unable to perform its obligations under the proposed sublease or assignment; (iii) the portion of the Premises proposed to be sublet is irregular in shape and/or does not pe1mit safe or otherwise appropriate means of ingress and egress, or does not comply with other Laws or regulations; (iv) Landlord or Landlord's agents have negotiated with the proposed assignee or subtenant with regard to the leasing of space at the Property, at any time within the preceding six (6) months; or (v) any other reasonable basis that Landlord may assert. The foregoing notwithstanding, if Landlord elects exercise its recapture rights as described in clause (a) above, Tenant shall have the right, to be exercised by written notice delivered to Landlord within five (5) business days following delivery of Landlord's notice of exercise of its recapture rights, in which to rescind Tenant's request for consent to the transaction triggering Landlord's recapture rights, in which event Landlord's exercise of its recapture rights shall be null and void and of no further force or effect.
13.4 Transfer Premium. If Landlord consents to any requested assignment or sublease (each a "Transfer") and the assignee or subtenant pays to Tenant an amount in excess of the Rent due under this Lease (after deducting Tenant's reasonable, actual expenses in obtaining such assignment or sublease, such expenses being limited to (a) any Alterations to the subject space made in order to achieve the Transfer, or contributions to the cost thereof, amortized in equal monthly installments over the then remainder of the Term and (b) any commercially CITA\5141711383040.2 18
reasonable brokerage commissions, reasonable attorneys' fees and reasonable advertising and marketing costs incurred by Tenant in connection with the Transfer) ("Transfer Preminm").
Tenant shall pay fifty percent (50%) of such Transfer Premium to Landlord as and when the monthly payments are received by Tenant.
13.5 Tenant Affiliates. Notwithstanding anything to the contrary contained in Section
13.1, Tenant may, without obtaining the prior consent of Landlord, and without the payment of any amounts pursuant to Section 13.4, sublet or license the use of all or any part of the Premises or assign this Lease to a Tenant Affiliate, provided that (a) Tenant shall give not less than thirty (30) days' prior written notice thereof to Landlord (to the extent such notice is permitted by applicable Law), (b) Tenant shall continue to be fully obligated under this Lease, and ( c) any such assignee or sublessee shall, in a writing signed by both Landlord and such assignee or sublessee, expressly assume and agree to perform all the terms and conditions of this Lease.to be performed by Tenant and to use the Premises only for a Permitted Use (but with respect to a sublease, only with respect to that portion of the Premises that is the subject of the sublease and excluding all rental obligations of Tenant hereunder). As used herein, "Tenant Affiliate" means (i) an entity controlling, controlled by or under common control with Tenant, (ii) a successor corporation related to Tenant by merger, consolidation, nonbank:ruptcy reorganization, or government action, or (iii) a purchaser of substantially all of Tenant's assets located in. the Premises; and a party shall be deemed to "control" another party for purposes of the definition contained in the aforesaid clause (i) only if the first party owns more than fifty percent (50%) of the stock or other beneficial interests of the second party or has the power to direct or cause the direction of the management or policy of the second party, or the first and second party share the same, or substantially the same (defined as a majority of directors on the "controlled" entity's board are also on the other entity's board), board of directors. Within five (5) business days of execution of any such sublease or license with a Tenant Affiliate, Tenant shall deliver to Landlord a copy of the fully executed assignment, sublease or license.
13.6 No Release. No Transfer shall release or discharge Tenant of or from any liability, whether past, present or future, under this Lease, and Tenant shall continue to be fully liable hereunder. Each subtenant or assignee shall agree, in a form reasonably satisfactory to Landlord, to comply with and be bound by all of the terms, covenants, conditions, provisions and agreements of this Lease. The assignment or sublease agreement, as the case may be, after approval by Landlord, shall not be amended without Landlord's prior written consent, and shall contain a provision directing the assignee or subtenant to pay the rent and other sums due thereunder directly to Landlord upon receiving written notice from Landlord that Tenant is in Default under this Lease with respect to the payment of Rent. In the event that, notwithstanding the giving of such notice, Tenant collects any rent or other sums from the assignee or subtenant, then Tenant shall hold such sums in trust for the benefit of Landlord and shall immediately forward the same to Landlord. Landlord's collection of such rent and other sums shall not constitute an acceptance by Landlord of attomment by such assignee or subtenant. Tenant shall deliver to Landlord promptly after execution an executed copy of each Transfer and an agreement of cornpliance by each such subtenant or assignee.
13.7 Elq;ienses and Attorneys' Fees. Tenant shall pay to Landlord all costs and expenses (including without limitation, the fees of Landlord's counsel) incurred in connection CIT A\514 I 7\1383040.2 19
Landlord's review and processing of documents regarding any proposed Transfer (which under no circumstances shall be less than $750 per proposed Transfer or more than $2,000).
13.8 Limitations on Transfer Reasonable. Tenant acknowledges and agrees that the restrictions, conditions, and limitations imposed by this Article 13 on Tenant's ability to assign or transfer this Lease or any other interests herein, to sublet the Premises or any part thereof, are, for purposes of California Civil Code Section 1951.4, as amended from time to time, and for all other purposes, reasonable at the time this Lease was entered into and shall be deemed to be reasonable at the time that Tenant seeks to assign or transfer this Lease or any interest herein, to sublet the Premises or any part thereot; or transfer or assign any right or privilege appurtenant to the Premises.
14. INDEMNITY AND W AIYER OF CLAIMS.
14.1 Tenant Indemnification. Tenant shall indemnify, defend and hold Landlord and Landlord Related Parties harmless against and from all liabilities, obligations, damages, penalties, claims, actions, costs, charges, judgment and expenses (including reasonable attorneys' fees, costs and disbursements) (collectively referred to as "Losses"), arising from (a) the use of, or any activity done, permitted or suffered in or about the Premises (b) any activity done, permitted or suffered by Tenant or Tenant's agents, contractors, invitees or licensees in or about the Building or Land (c) any act, neglect, fault, willful misconduct of Tenant or Tenant's agents, or (d) from any breach or default in the terms of this Lease by Tenant or Tenant's agents, except to the extent such claims arise out of or relate to the gross negligence or willful misconduct of Landlord. If any action or proceeding is brought against Landlord by reason of any such claim, upon notice from Landlord, Tenant shall defend the same at Tenant's expense by counsel reasonably satisfactory to Landlord. As a material part of the consideration to Landlord, Tenant hereby releases Landlord and its trustees, members, principals, beneficiaries, partners, officers, directors, employees, property managers, Mortgagees, contractors and agents ("Landlord Related Parties") from responsibility for, waives its entire claim ofrecovery for and assumes all risks of (i) damage to property or injury to person in or about the Premises, Building or Land from any cause whatsoever except to the extent caused by the gross negligence or willful misconduct of Landlord or any Landlord Related Parties, or (ii) loss resulting from business inte1rnption or loss of income at the Premises.
14.2 WaiV<Jr _pf Claims. Except in the event of its own gross negligence or willful misconduct, Landlord shall not be liable to Tenant and Tenant hereby waives all claims against Landlord and Landlord Related Parties for any injury or damage to any person or property occurring or incurred in connection with or in any way relating to the Premises, Building or Land from any cause. Without limiting the foregoing, neither Landlord nor any Landlord Related Party shall be liable for and there shall be no abatement rent for (a) any damage to Tenant's property stored with or entrusted to any Landlord Related Party, (b) loss of or damage to any property by theft or any other wrongful or illegal act, or (c) any injury or damage to person or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water or rain which may leak from any part of the Premises or Building or from the pipes, appliances, appurtenance or plumbing works thereof or from the roof, street or surface or from any other place or resulting from dampness or any other cause whatsoever or from the acts or omissions of other tenants, occupants or other visitors to the Premises or Building or from any other cause whatsoever, CITA\5141711383040.2 20
( d) any diminution or shutting off of light, air or view by any structure which may be erected on lands adjacent to the Premises or (e) any latent or other defects in the Premises, Building or Land. Tenant agrees that in no case shall Landlord or any Landlord Related Party be responsible or liable on any theory for any injury to Tenant's business, loss of profits, loss of income or any other form of consequential damage.
14.3 Survivql/No Impairment. The obligations of Tenant under this Article 14 shall survive any termination of this Lease. The foregoing indemnity obligations shall not relieve any insurance carrier of its obligations under any policies required to be carried by either party pursuant to this Lease, to the extent that such policies cover the peril or currents that results in the claims that is subject to the foregoing indemnity.
15. INSURANCE.
15. l Tenant's Insurance.
(a) Li<tbilily Insurance. Tenant shall maintain in full force throughout the Term, commercial general liability insurance providing coverage on an occurrence form basis with limits of not less than Two Million Dollars ($2,000,000.00) each occurrence for bodily injury and property damage combined, or such larger amount as Landlord may prudently require from time to time, covering bodily injury and property damage liability and product liability if a product is sold from the Premises, Each policy of liability insurance required by this Section shall: (i) contain a cross liability endorsement or separation of insureds clause; (ii) provide that any waiver of subrogation rights or release prior to a loss does not void coverage; (iii) provide that it is primary to and not contributing with, any policy of insurance carried by Landlord covering the same loss; (iv) provide that any failure to comply with the reporting provisions shall not affect coverage provided to Landlord, its partners, property managers and Mortgagees; and (v) name Landlord, RiverRock Real Estate Group, Inc. and such other parties in interest as Landlord may from time to time reasonably designate to Tenant in writing, as additional insureds in an Additional Insured Endorsement. Such additional insureds shall be provided at least the same extent of coverage as is provided to Tenant under such policies. The additional insured endorsement shall be in a form at least as broad as endorsement form number CG 20 11 0 I 96 promulgated by the Insurance Services Office. (b) PersonaLPsoperty Insurance. Tenant shall maintain in full force and effect on all of its personal property, furniture, furnishings, trade fixtures and equipment from time to time located in, on or upon the Premises ("Tenant's Property"), and any Alterations (as defined in Article 10) in an amount not less than one hundred percent (100%) of their full replacement value from time to time during the Term, providing protection against all perils, included within the standard form of"all-risk" (i.e., "Special Cause of Loss") fire and casualty insurance policy. Landlord shall have no interest in the insurance upon Tenant's Property or Alterations and will sign all documents reasonably necessary in connection with the settlement of any claims or loss by Tenant. Landlord will not carry insurance on Tenant's Property or Alterations.
(c) Worker's Compensation lnsurnnce; Employer's Liability Insurance. Tenant shall, at Tenant's expense, maintain in full force and effect during the Term CIT AIS 141711383040.2 21
of this Lease, worker's compensation insurance with not less than the minimum limits required by law, and employer's liability insurance with a minimum limit of coverage of One Million Dollars ($1,000,000.00).
(d) {Intentionally Omitted}
(e) B\IsinessJnterrupticmfosurariCe, Tenant shall, at Tenant's expense, maintain in full force and effect during the Term of this Lease, Business Interruption Insurance with a limit of liability of at least twelve (12) months estimated gross earning, as defined in the standard form of business interruption insurance policy, of Tenant at the Premises, which insurance shall be on an "all risk" basis (or its equivalent). (f) Automobile Liability. Tenant shall maintain in full force and effect during the Term of this Lease, Commercial Automobile Liability. Such policy shall be in an amount of not less than One Million Dollars ($1,000,000) combined singled limit. (g) .!.duuor Liability Insurance. Tenant shall; at Tenant's expense, and maintain in full force and effect during the Term of this Lease, Dram Shop or Liquor Liability Insurance with a limit of not less than Two Million Dollars ($2,000,000) per occurrence such larger amount as Landlord may prudently require from time to time.
15.2 Requirements For All Policies. Each policy of insurance required under Section
15.1 shall: (a) be in a form, and written by an insurer, reasonably acceptable to Landlord, (b) be maintained at Tenant's sole cost and expense, and (c) require at least thirty (30) days' written notice to Landlord prior to any cancellation, nonrenewal or modification of insurance coverage.
Insurance companies issuing such policies shall have rating classifications of"A-" or better and financial size category ratings of"VII" or better according to the latest edition of the Best Key Rating Guide. All insurance companies issuing such policies shall be admitted carriers licensed to do business in the state where the Property is located. Any deductible amount under such insurance shall not exceed $5,000. Tenant shall provide to Landlord, upon request, evidence that the insurance required to be carried by Tenant pursuant to this Section, including any endorsement affecting the additional insured status, is in full force and effect and that premiums therefor have been paid. Tenant shall, at least thirty (30) days prior to expiration of each policy, furnish Landlord with certificates of renewal thereof and shall provide Landlord with at least thirty days prior written notice of any cancellation or modification.
15.3 Certificates of Insurance. Upon execution of this Lease by Tenant, and not less than thitty (30) days prior to expiration of any policy thereafter, Tenant shall furnish to Landlord a certificate of insurance reflecting that the insurance required by this Article is in furce, accompanied by an endorsement(s) showing the required additional insureds satisfactory to Landlord in substance and form.
15.4 Landlord's Insurance. During the Term, Landlord may, at its sole and absolute discretion, keep in effect property insurance covering the Building in amounts not less than the full insurance replacement value thereof (but not on any Alterations or any of Tenant's Property) with customary limits and deductibles, together with such other types of insurance coverage, if any, as Landlord, in Landlord's sole discretion, may elect to carry.
CIT AIS 141711383040.2 22
16. DAMAGE OR DESTRUCTION.
If by no fault of the Tenant, the Leased Premises are totally or partially damaged or destroyed by fire, earthquake, accident or other casualty, Lessor shall have the right to repair or rebuild the Leased Premises. If Lessor elects to repair or rebuild, it shall give Tenant notice of its election within 60 days of the event causing damage. If Lessor is able to complete such restoration within 90 days from the date of damage, subject to terms of this paragraph, this Lease shall remain in full force and effect. If Lessor is unable to restore the Leased Premises within this time, or if Lessor elects not to repair or rebuild, then either Lesso.r or Tenant may terminate this Lease by giving the other written notice. Rent shall be abated as of the date of damage. The abated amount shall be the current monthly Rent prorated on a 30 day basis. If this Lease is not terminated and the damage is not repaired, then Rent shall be reduced based upon the extent to which the damage interferes with Tenant's reasonable use of the Lease Premises. If damage occurs as a result of an act of Tenant or Tenant's guest, only the Lessor shall have the right of termination and no reduction in Rent shall be made.
17. CONDEMNATION.
If the whole or if any material part of the Premises or Building is taken or condemned for any public or quasi-public use under either state or federal law, by eminent domain or purchase in lieu thereof(a "Taking"), and (a) such Taking renders the Premises or Building unsuitable, in Landlord's reasonable opinion, for the purposes for which they were constructed; or (b) the Premises or Building cannot be repaired, restored or replaced at reasonable expense to an economically profitable unit, then Landlord may, at its option, terminate this Lease as of the date possession vests in the condemning party. If twenty-five percent (25%) or more of the Premises is taken and if the Premises remaining after such Taking and any repairs by Landlord would be tenantable (in Tenant's reasonable opinion) for the conduct of Tenant's business operations, Tenant shall have the right to terminate this Lease as of the date possession vests in the condemning party. The terminating party shall provide written notice of termination to the other party within thirty (30) days after it first receives notice of the Taking. The termination shall be effective as of the effective date of any order granting possession to, or vesting legal title in, the condemning authority. If this Lease is not terminated, Base Rent shall be appropriately adjusted to account for any reduction in the square footage of the Premises. If only a part of the Premises is subject to a Taking and this Lease is not terminated, Landlord, with reasonable diligence, will restore the remaining portion of the Premises as nearly as practicable to the condition immediately prior to the Taking. Tenant hereby waives any and all rights it might otherwise have pursuant to Section 1265.130 of the California Code of Civil Procedure, or any similar or successor Laws. Landlord shall be entitled to any and all compensation, damages, income, rent, awards or any interest thereon which may be paid or made in connection with any such Taking, and Tenant shall have no claim against Landlord for the value of any expired term of this Lease or otherwise; provided, however, that Tenant shall be entitled to receive any award separately allocated by the condemning authority to Tenant for Tenant's relocation expenses, the value of Tenant's fixture, equipment and personal property (specifically excluding components of the Premises which under this Lease or by law are or at the expiration of the Term will become the property of Landlord, including, without limitation, fixtures and Alterations), or Tenant's loss of business goodwill, provide that such award does not reduce any award otherwise allocable or payable to Landlord.
CIT A 151417\1383040.2 23
18. DEFAULT.
18.1 Events of Default. The occurrence of any of the following shall constitute a "Default" by Tenant:
(a) Tenant fails to make any payment of Rent when due, if payment in full is not received by Landlord within five (5) days after written notice that it is past due.
(b) Tenant abandons the Premises as defined in Section 1951.3 of the California Civil Code.
( c) Tenant fails timely to deliver any subordination document or estoppel certificate requested by Landlord within the applicable time period specified hereinbelow.
(d) Tenant violates the restrictions on Transfer set forth in Article 13.
(e) Tenant ceases doing business.as a going concern; makes an assignment for the benefit of creditors; is adjudicated an insolvent, files a petition (or files an answer admitting the material allegations of a petition) seeking relief under any state or federal bankruptcy or other statute, law or regulation affecting creditors' rights; all or substantially all of Tenant's assets are subject to judicial seizure or attachment and are not released within thirty (30) days, or Tenant consents to or acquiesces in the appointment of a trustee, receiver or liquidator for Tenant or for all or any substantial part of Tenant's assets. (f) Tenant fails to perform or comply with any provision of this Lease other than those described in (a) through (e) above, and does not fully cure such failure within fifteen (15) days after notice to Tenant or, if such failure cannot be cured within such fifteen (15) day period, Tenant fails within such fifteen (15)-day period to commence, and thereafter diligently proceed with, all actions necessary to cure such failure as soon as reasonably possible but in all events within ninety (90) days of such notice.
18.2 Remedies. Upon the occurrence of any Default under this Lease, whether enumerated in Section 18.1 or not, Landlord shall have the option to pursue any one or more of the following remedies without any notice (except as expressly prescribed herein) or demand whatsoever. Without limiting the generality of the foregoing, Tenant hereby specifically waives notice and demand for payment of Rent or other obligations, and waives any and all other notices or demand requirements imposed by applicable Law:
(a) Terminate this Lease and Tenant's rightto possession of the Premises and recover from Tenant an award of damages equal to the sum of the following:
(i) The Worth at the Time of Award of the unpaid Rent
which had been earned at the time of termination;
CIT A\5141711383040.2 24
(ii) The Worth at the Time of Award of the amount by
which the unpaid Rent which would have been earned after termination until .the time of award exceeds the amount of such Rent loss that Tenant affirmatively proves could have been reasonably avoided;
(iii) The Worth at the Time of Award of the amount by
which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent Joss that Tenant affirmatively proves could be reasonably avoided discounted to the then present value;
(iv) Any other amount necessary to compensate
Landlord for all the detriment either proximately caused by Tenant's failure to perform Tenant's obligations under this Lease or which in the ordinary course of things would be likely to result therefrom; and
(v) All such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time under applicable law.
The "Worth at the Time of Award" of the amounts refetTed to in parts (i) and (ii) above, shall be computed by allowing interest at the lesser of a per annum rate equal to: (A) the greatest per armum rate of interest permitted from time to time under applicable law, or (B) the Prime Rate plus 5% as determined by Landlord, and as referred to in part (iii) above, shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank.of San Francisco at the time of the award plus one percent (1%). (b) Employ the remedy described in California Civil Code § 1951.4 (Landlord may continue this Lease in effect after Tenant's breach and abandonment and recover Rent as it becomes due, ifTenant has the right to sublet or assign, subject only to reasonable limitations); or
(c) Notwithstanding Landlord's exercise of the remedy
described in California Civil Code§ 1951.4 in respect of an event or events of Default, at such time thereafter as Landlord may elect in writing, to terminate this Lease and Tenant's tight to possession of the Premises and recover an award of damages as provided above.
18.3 No Waiver. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular Rent so accepted, regardless of Landlord's knowledge of such preceding breach at the time of acceptance of such Rent. No waiver by Landlord of any breach hereof shall be effective unless such waiver is in writing and signed by Landlord.
18.4 Waiver of Redemption, Reinstatement, or Rcstoratioi1. Tenant hereby waives any and all rights confe1Ted by Section 3275 of the Civil Code of California and by Sections l l 74(c) and 1179 of the Code of Civil Procedure of California and any and all other laws and rules of law from time to time in effect during the Lease Term or thereafter providing that Tenant shall CITA \51417\1383040.2 25
have any right to redeem, reinstate or restore this Lease following its termination as a result of Tenant's breach.
18.5 Remedies. Cumulative. No right or remedy herein conferred upon or reserved to Landlord is intended to be exclusive of any other right or remedy, and each and every right and remedy shall be cumulative and in addition to any other right or remedy given hereunder or now or hereafter existing by agreement, applicable Law or in equity, In addition to othe.r remedies provided in this Lease, Landlord shall be entitled, to the extent permitted by applicable Law, to iajunctive relief, or to a decree compelling performance of any of the covenants, agreements, conditions or provisions of this Lease, or to any other remedy allowed to Landlord at law or in equity. Forbearance by Landlord to enforce one or more of the remedies herein provided upon an event of Default shall not be deemed or construed to constitute a waiver of such Default.
18.6 Landlord's Right to Perfonn Tenant's Obligatibns. If Tenant is in Default of any of its non-monetary obligations under this Lease, in addition to the other rights and remedies of Landlord provided herein, then Landlord may at Landlord's option, but without any obligation to do so and without further notice to Tenant, perform any such term, provision, covenant or condition or make any such payment and Landlord by reason of doing so shall not be liable or responsible for any loss or damage thereby sustained by Tenant. If Landlord performs any of Tenant's obligations hereunder in accordance with this Section 18.6, the full amount of the costs and expense incurred or the payments so made or the amount of the loss so sustained shall be immediately be owed by Tenant to Landlord, and Tenant shall promptly pay to Landlord upon demand, as Additional Rent, the full amount thereof with interest thereon from the day of payment by Landlord the lower often percent (10%) per annum, or the highest rate permitted by applicable law.
18. 7 Severabilli,y. This Article 18 shall be enforceable to the maximum extent such enforcement is not prohibited by applicable Law, and the unenforceability of any portion thereof shall not thereby render unenforceable any other portion.
19. LIMITATION OF LIABILITY.
Notwithstanding anything to the contrary contained in this Lease, the liability of Landlord (and of any successor landlord) shall be governed by applicable state and federal laws for so long as Landlord is a public entity and, at any time thereafter, shall be limited to the interest of Landlord in the Building as the same may from time to time be encumbered. Tenant shall look solely to Landlord's interest in the Building for the recovery of any judgment. Neither Landlord nor any Landlord Related Party shall be personally liable for any judgment or deficiency, and in no event shall Landlord or any Landlord Related Party be liable to Tenant for any lost profit, damage to or loss of business or a form of special, indirect or consequential damage. Before filing suit for an alleged default by Landlord, Tenant shall give Landlord and the Mortgagee(s) whom Tenant has been notified hold Mortgages (defined in Article 22 below), notice and reasonable time to cure the alleged default.
ClTA\5141711383040.2 26
20. SURRENDER OF PREMISES.
At the termination of this Lease or Tenant's right of possession, Tenant shall remove Tenant's property including any furniture, fixtures, equipment or cabling installed by or for the benefit of Tenant from the Premises, and quit and surrender the Premises to Landlord, broom clean, and in good order, condition and repair, ordinary wear and tear and damage which Landlord is obligated to repair hereunder excepted. Landlord may, by notice to Tenant not less than sixty (60) days prior to the Expiration Date (except in the event of a termination of this Lease prior to the scheduled Expiration Date, in which event no advance notice shall be required) require Tenant, at Tenant's expense, remove any Alterations (except as otherwise provided at Section 10.2, above) and repair any damage caused by such removal. If Tenant fails to remove any of Tenant's property, or to restore the Premises to the required condition, Landlord, at Tenant's sole cost and expense, shall be entitled (but not obligated) to remove and store Tenant's property and/or perform such restoration of the Premises. Landlord shall not be responsible for the value, preservation or safekeeping of Tenant's property. Tenant shall pay Landlord, upon demand, the expenses and storage charges incurred. If Tenant fails to remove Tenant's property from the Premises or storage, within thirty (30) days after notice, Landlord may deem all or any part of Tenant's property to be abandoned and, at Landlord's option, title to Tenant's property shall vest in Landlord or Landlord may dispose of Tenant's property in any manner Landlord deems appropriate.
21. HOLDING OVER.
If Tenant fails to surrender all or any part of the Premises at the termination of this Lease, occupancy of the Premises after termination shall be that of a tenancy at sufferance.
Tenant's occupancy shall be subject to all the terms and provisions of this Lease and Tenant shall pay an amount (on a per month basis without reduction for partial months during the holdover) equal to 150% of the sum of the Base Rent due for the period immediately preceding the holdover. No holding over by Tenant shall operate to extend the Term. If Tenant does not surrender possession at the end of the Term or sooner termination of this Lease, Tenant shall indemnify and hold Landlord harmless from and against any and all losses or liability resulting from delay in Tenant so surrendering the Premises including, without limitations, any loss or liability resulting from any claim against Landlord made by any succeeding tenant or prospective tenant founded on or resulting from such delay. Any holding over by Tenant with the written consent of Landlord shall thereafter constitute a lease from month to month.
22. MORTGAGES.
22.1 Subordination to Mortgages. Tenant accepts this Lease subject and subordinate to any mortgage(s), deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising upon the Premises, or Building and any ground lease(s) or other agreements or covenants running with the land now or subsequently arising upon the Building, and to renewals, modifications, refinancing and extensions thereof (collectively referred to as a "Mortgage").
The party having the benefit of a Mortgage shall be referred to as a "Mortgagee". This clause shall be self-operative, but upon request from a Mortgagee, Tenant shall, within ten (10) days written request therefor from Landlord, execute a commercially reasonable subordination agreement in favor of the Mortgagee. Landlord shall use commercially reasonable efforts to CIT A\5 I 4 I 711383040.2 27
obtain for Tenant a non-disturbance provision in any such subordination agreement. As an alternative, a Mortgagee shall have the right at any time to subordinate its Mortgage to this Lease. Upon request, Tenant, shall attorn to any successor to Landlord's interest in this Lease.
22.2 Mort)$t<ge Pl'Otectio11. Tenant shall give to any Mortgagee, in accordance with the notice requirements of Article 25 below, at the same time as it is given to Landlord, a copy of any notices of default given to Landlord, provided that, prior to such notice, Tenant has been notified in writing (by way of notice of assignment of rent and leases, or otherwise) of the existence and address of such Mortgagee. Tenant further agrees that, if Landlord shall have failed to cure such default within the time provided for in this Lease, then the Mortgagee shat.I have an additional reasonable period of time within which to cure such default, or if such default cannot be cured without M01tgagee pursuing its remedies against Landlord, then mortgagee shall have such additional time as may be necessary to commence and complete a foreclosure proceeding. If, in connection with obtaining financing for the Project, or a portion thereof, Landlord's lender shall request reasonable modifications to this Lease as a condition to such financing, Tenant shall not unreasonably withhold, delay or defer its consent to such modifications, provided that such modifications do not materially adversely affect Tenant's rights or increase Tenant's obligations under this Lease.
23. TENANT'S ESTOPPEL CERTIFICATE.
Within ten (10) days after written request therefor, Tenant shall execute and deliver to Landlord, in a form provided by or satisfactory to Landlord, an estoppel certificate stating, that this Lease is in full force and effect, describing any amendments or modifications thereto, acknowledging that this Lease is subordinate or prior, as the case may be, to any Mortgage and stating any other information Landlord may reasonably request, including the Term, the monthly Base Rent, the. date to which Rent has been paid, the amount of any security deposit or prepaid rent, whether either party hereto is in default under the terms of the Lease, and whether Landlord has completed any construction obligations hereunder. Any such estoppel certificate may be relied upon by any person or entity purchasing, acquiring an interest in or extending finance with respect to the Building, or any part thereof. If Tenant fails to provide such certificate within ten ( 10) days as herein provided, such failure shall at Landlord's election, constitute a Default and Tenant shall be deemed to have given such certificate as above provided without modification and shall be deemed to have admitted the accuracy of any information supplied by Landlord to a prospective purchaser or mortgagee or deed of trust holder.
24. {Intentionally Omitted}
25. NOTICE.
All notices shall be in writing and delivered by hand or sent by registered, express, or certified mail, with return receipt requested or with delivery confirmation requested from the U.S. postal service, or sent by overnight or same day courier service at the party's respective Notice Address( es) set forth in the Basic Lease Information ("Notice Address").
Each notice shall be deemed to have been received on the earlier to occur of actual delivery or the date on which delivery is refused, or, if Tenant has vacated the Premises or any other Notice Address of Tenant without providing a new Notice Address, three (3) days after notice is CITA\51417\1383040.2 28
deposited in the U.S. mail or with a courier service in the manner described above. Either party may, at any time, change its Notice Address (other than to a post office box address) by giving the other party written notice of the new address.
26. LABOR PROVISIONS,
26.1 Equal Opp01tu11ity. During the Term, and with respect to person(s) in the Building or Premises or employment or employees at the Premises, Tenant agrees as follows:
(a) Tenant will not discriminate against any guest, visitor, invitee, customer, employee of Tenant or applicant for employment because of employment because ofrace, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender identity, gender expression, age, sexual orientation, or militaiy and veteran status. The employees of Tenant shall be treated during employment, without regard to their employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender identity, gender expression, age> sexual orientation, or military and veteran status.
Such action shall include, but not be limited to, the following: employment, upgrading demotion, or transfer, recruitment or recruitment advertising, layoff or termination, rate of pay or other forms of compensation, selection for training, including apprenticeship. Tenant agrees to post in conspicuous places, notices to be provided by the applicable government agencies, setting forth the provisions of this nondiscrimination provision.
(b) Tenant will, in all solicitations or advertisements for employees placed by or on behalf of Tenant, state that all qualified applicants will receive consideration for employment without regard to employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender identity, gender expression, age, sexual orientation, or military and veteran status.
(c) Tenant will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding a notice, advising the labor union or worker's representative of Tenant's commitments under this Equal Opportunity Clause and shall post copies of notice in conspicuous places available to employee and applications for employment.
( d) Tenant, through any approved sublease, shall require each of its subtenants to comply with the nondiscrimination provisions contained in this Section 26.1.
26.2 Convict Labor. In connection with the performance of work required by this Lease, Tenant agrees not to employ any person undergoing a sentence of imprisonment at hard labor.
26.3 Prevailing Wages and Related Requitements. Tenant acknowledges and agrees any Alterations made by or on behalf of Tenant to the Premises, or any portion thereof, which are paid for in whole or in part by Landlord or which are considered to have been paid for in whole or in part by Landlord (e.g. by virtue of any rents that are reduced, waived or forgiven) will constitute "[c]onstruction, alteration, demolition, installation, or repair work done under ClTA\5141711383040.2 29
contract and paid for in whole or in part out of public funds ... ". (California Labor Code section 1720.) Tenant shall comply with any applicable laws, rules and regulations related to construction wages and other construction matters, if and to the extent applicable to the Premises after the Commencement Date including, but not limited to, the provision of Labor Code Section 1720 et seq., and/or Section 2-67 of the Alameda Municipal Code. From and after the Commencement Date, Tenant shall indemnify, defend (with counsel reasonably acceptable to Landlord), and hold harmless the Landlord Related. Parties against any claim for damages, compensation, fines, penalties or other amounts arising out of the failure or alleged failure of any person or entity (including Tenant and its contractors) to pay prevailing wages as determined pursuant to Labor Code Sections 1720 et seq., to employ apprentices pursuant to Labor Code Sections 1777.5 et seq., to require any contractor or subcontractor listed on a bid proposal for a public works project be registered with the Department oflndustrial Relations pursuant to Labor Code Section 1725.5, to comply with the other applicable provisions of Labor Code Sections 1720 et seq. and 1777.5 et seq., to meet the conditions of Section 1771.4 of the Labor Code, to require the general contractor for any prevailing wage work to furnish electronic certified payroll records directly to the Labor Commissioner at: https://apps.dir.ca.gov/ecpr/das/altlogin, or to comply with any other regulation related to public contracts. Tenant's obligation to indemnify, defend and hold harmless under this Section 26.3 shall survive termination of this Lease, and shall be interpreted broadly so as to apply to any legal or administrative proceeding, arbitration, or enforcement action.
27. MISCELLANEOUS.
27.l Governing Law. This Lease shall be interpreted and enforced in accordance with the Laws of the State of California and Landlord and Tenant hereby irrevocably consent to the jurisdiction and proper venue of such state.
27.2 Severability. If any section, term or provision of this Lease is held invalid by a court of competent jurisdiction, all other sections, terms or severable provisions of this Lease shall not be affected thereby, but shall remain in full force and effect.
27.3 Attorneys' Fees. In the event of an action, suit, arbitration or proceeding brought by Landlord or Tenant to enforce any of the other's covenants and agreements in this Lease, the prevailing party shall be entitled to recover from the non-prevailing party any costs, expenses (including out of pocket costs and expenses) and reasonable attorneys' fees incurred in connection with such action, suit or proceeding. Without limiting the generality of the foregoing, if Landlord utilizes the services of an attorney for the purpose of collecting any Rent due and unpaid by Tenant or in connection with any other breach of this Lease by Tenant following a written demand of Landlord to pay such amount or cure such breach, Tenant agrees to pay Landlord reasonable actual attorneys' fees for such services, irrespective of whether any legal action may be commenced or filed by Landlord.
27.4 Force Majeure. Whenever a period of time is prescribed for the taking of an action by Landlord or Tenant (other than the payment of Rent), the period of time for the performance of such action shall be extended by the number of days that the performance is actually delayed due to strikes, acts of God, shortages oflabor or materials, war, terrorist acts, CITA\5141711383040.2 30
pandemics, civil disturbances, extreme weather and other causes beyond the reasonable control of the performing party ("Force Majeure'}
27.5 Sale. Landlord shall have the right to transfer and assign, in whole or in part, all of its rights and obligations under this Lease and in the Building. Upon transfer, Landlord shall be released from any further obligations hereunder and Tenant agrees to look solely to the successor in interest of Landlord for the performance of such obligations, provided that any successor pursuant to a voluntary, third party transfer (but not as part of an involuntary transfer resulting from a foreclosure or deed in lieu thereof) shall have assumed Landlord's obligations under this Lease.
27.6 Signs. Tenant shall be entitled to install signage in the restored marque of the Building conforming to specifications provided by Landlord. Any additional signage must be reviewed and approved by Landlord for compatibility with the historic restoration of the Building. All signage shall be at Tenant's cost and subject to Landlord's reasonable consent and the approval of the City acting in its regulator capacity, and subject to its permitting authority pursuant to the Alameda Municipal Code.
27.7 Brokers. Landlord and Tenant each represents and. warrants to the other that neither it nor its officers or agents nor anyone acting on its behalf has dealt with any real estate broker except the Brokers specified in the Basic Lease Information in the negotiating or making of this Lease. Each party agrees to indemnify, defend and hold harmless the other from any claim or claims, and costs and expenses, including attorneys' fees, incurred by the indemnified party in conjunction with any such claim or claims of any other broker or brokers to a commission in connection with this Lease as a result of the actions of the indemnifying party.
Provided that this Lease is fully executed by the parties hereto, Landlord shall pay a commission to Landlord's Broker pursuant to a separate written agreement between Landlord and Landlord's Broker, and Landlord's Broker shall be responsible for any fee or commission payable to Tenant's Broker.
27. 8 Access by Landlord. In addition to access provided by this Lease, Landlord shall be allowed access to the Premises at all reasonable times throughout the term of this Lease, for any reasonable purpose upon prior written notice to Tenant. Landlord will normally give Tenant a minimum of twenty-four (24) hours prior notice of an intention to enter the Premises, unless the entry is reasonably required on an emergency basis for safety, environmental, operations or security purposes. Tenant shall ensure that a telephone roster is maintained at all times for on call persons representing Tenant who will be available on short notice, 24 hours a day, 365 days per year, and have authority to use all keys necessary to gain access to the Premises to facilitate entry in time of emergency. Tenant shall ensure that Landlord has a current roster of such on call personnel and their phone numbers. Tenant shall not change any existing locks, or attach any additional locks or similar devices to any door or window, without providing to Landlord one set of keys therefor. All keys must be returned to Landlord at the expiration or termination of this Lease. Tenant shall have no claim against Landlord for exercise of its rights of access hereunder. Portions of the utilities systems serving the former Naval Air Station Alameda may be located within the Building or Premises. Tenant agrees to allow Landlord and its utility supplier reasonable access to the Premises for operation, maintenance, repair and replacement of these utilities systems as may be required. In executing operation, maintenance, repair or CIT A\5141711383040.2 31
replacement of these systems, Landlord agrees to take commercially reasonable steps to limit interference with the use of the Premises by Tenant.
27.9 Waiver ofRight to Jury Trial. Landlord and Tenant waive.their respective rights to trial by jury of any contract or tort claim, counterclaim, cross-complaint, or cause of action in any action, proceeding, or hearing brought by either party against the other on any matter arising out of or in any way connected with this Lease, the relationship of Landlord and Tenant, or Tenant's use or occupancy of the Premises, including without limitation any claim ofinjmy or damage or the enforcement of any remedy under any current or future law, statute, regulation, code, or ordinance. Landlord and Tenant agree that this paragraph constitutes a written consent to waiver of trial by jury within the meaning of California Code of Civil Procedure Section 63l(f)(2), and Tenant does hereby authorize and empower Landlord to file this paragraph and/or this Lease, as required, with the clerk or judge of any court of competent jurisdiction as a written consent to waiver of jury trial. If the waiver set forth in this Section 27.9 is dete1mined by any court to be invalid because it was executed prior to the commencement of any action, then Landlord and Tenant each covenant and agree to execute and deliver to the other, within five (5) days of a written request by the other, a waiver of the right to trial by jury similar in terms and scope to the waiver set forth in this Section 27.9 at such time following the commencement of such action as such waiver , if then made, would be valid.
27.10 Recordation. Neither this Lease, nor any memorandum, affidavit nor other writing with respect thereto, shall be recorded by Tenant orby anyone acting through, under or on behalf of Tenant without the prior written consent of Landlord, which may be granted or withheld in Landlord's sole and absolute discretion. Any recording thereof in violation of this provision shall make this Lease null and void at Landlord's election.
27.11 Article and Section Titles. The Article and Section titles use herein are not to be consider a substantive part of this Lease, but merely descriptive aids to identify the paragraph to which they referred. Use of the masculine gender includes the feminine and neuter, and vice versa.
27.12 AuthoriJy_. If Tenant is a corporation, partnership, trust, association or other entity, Tenant and each person executing this Lease on behalf of Tenant does hereby covenant and warrant that (a) Tenant is duly incorporated or otherwise established or formed and validly existing under the laws of its state of incorporation, establishment or formation, (b) Tenant has and is duly qualified to do business in California, (c) Tenant has full corporate, partnership, trust, association or other power and authority to enter into this Lease and to perform all Tenant's obligations hereunder, and (d) each person (and all of the persons if more than one signs) signing this Lease on behalf of Tenant is duly and validly authorized to do so. Upon execution hereof and at Landlord's request, Tenant shall provide Landlord with a written certification of its Corporate Secretary or other appropriate authorizing officer or partner attesting that at a duly noticed meeting of its Board of Directors or other governing body a resolution has been unanimously adopted approving Tenant's execution hereof, thereby binding itself to the terms of this Lease and identifying the person(s) authorized to execute this Lease on behalf of Tenant.
27.13 Quiel Possession. Landlord covenants and agrees with Tenant that, upon Tenant's payment of Rent and observing and performing all of the terms, covenants, conditions, CITA\51417\1383040.2 32
provisions and agreements of this Lease on Tenant's prut to be observed or performed, Tenant shall have the quiet possession of the Premises throughout the Term.
27.14 Guaranty. As a condition precedent to Landlord's entering into this Lease, Husam Haddad and Joe Dab it, and each of them, shall execute and deliver to Landlord the Guaranty attached hereto as Exhibit G.
27.15 OFAC Certificution. Tenant represents, warrants and covenants that: (a) Tenant and its principals are not acting, and will not act, directly or indirectly, for or on behalf of any person, group, entity, or nation named by any Executive Order or the United States Treasury Deprutment as a terrorist, "Specially Designated and Blocked Person" or other banned or blocked person, entity, nation, or transaction pursuant to any law, order, rule or regulation that is enforced or administered by the Office of Foreign Assets Control; and (b) Tenant acknowledges that the breach of this representation, wan-anty and covenant by Tenant shall be an immediate Default under the Lease.
27.16 Certified Access Specialist Disclosure. In accordance with Civil Code Section 1938, Landlord hereby discloses that the Premises have not undergone inspection by a Cettified Access Specialist for purposes of determining whether the property has or does not meet all applicable construction related accessibility standards pursuant to Civil Code Section 55.53. A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does nqt require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The pruties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the Premises. The forgoing notwithstanding, the parties agree that Tenant shall be solely responsible for the payment of all fees for the CASp inspection. The cost of making any repairs necessary to correct violations of construction-related accessibility standru·ds within the Premises shall be governed by Section 6.2 above.
27.17 Time of the Essence. Time is of the essence of this Lease and each and all of its provisions.
27.18 Entire Agreement. This Lease contains all of the agreements of the parties hereto with respect to any matter covered or mentioned in this Lease, and no prior agreements or understandings pertaining to any such matter shall be effective for any purpose. No provision of this Lease may be amended or added except by an agreement in writing signed by the parties hereto or their respective successors-in-interest.
27.19 Financial Statement. Within thirty (30) days after Landlord's written request, Tenant shall deliver to Landlord the then current financial statements of Tenant, including a balance sheet and profit and loss statement for the most recent prior year, all prepared in accordance with generally accepted accounting principles consistently applied and shall be certified as accurate in all material respect by an officer of Tenant.
CIT A\51417\1383040.2 33
27.20 Relocation Benefits. Tenant acknowledges that upon the expiration or earlier termination of this Lease, for any reason other than a Taking as defined at Article 17, Tenant shall not be a displaced person, and therefore waives any and all claims for relocation benefits, assistances and/or payments under Government Code Sections 7260 et seq., 25 California Code of Regulations Sections 600 et seq., 42 U.S.C. 4601 et seq., 29 C.F.R. Sections 121 et seq. and 49 C.F.R Sections 24.1 et seq. Tenant further acknowledges and agrees that upon the expiration or earlier termination of this Lease for any reason, other than a Taking as hereinabove defined, no claim shall arise, nor shall Tenan~ assert any claim for loss of business goodwill (as that term is defined at CCP §1263.510) and no compensation for loss of business goodwill shall be paid by Landlord.
27.21 Counterparts. This Lease may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument.
Landlord and Tenant have executed this Lease as of the day and year first above written.
LANDLORD:
Elizabeth D. Warmerdam
Acting City Manager
Date: f /R' /J~
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CITA\51417\1383040.2 34
TENANT:
Play House, LLC,
a California limited liability company
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CITA\5141711383040.2
EXHIBIT A
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EXHIBITB
COMMENCEMENT LETTER
Re: Lease dated as of ___ , 2018, by and between City of Alameda, as Landlord, and . , a , as Tenant, for J ,850 rentable
square feet in the Historic Alameda Theatre Building located at 2319 Central Avenue, Alameda, California.
In accordance with the terms and conditions of the above referenced Lease, Tenant accepts possession of the Premises and agrees:
1. The Commencement Date of the Lease is ---
2. The Expiration Date of the Lease is·-----
Please acknowledge your acceptance of possession and agreement to the terms set forth above by signing all 3 counterparts of this Commencement Letter in the space provided and returning 2 fully executed counterparts to my attention.
Sincerely
Landlord: City of Alameda
By: -------
Name: ·----·---··
Title:
Agreed and Accepted:
Tenant:---------
By: --------·
Name:-----·---
Title: --------
--·-·-·----·---·-----~-----'------------~~----~-
[Exhibit Do not sign]
CITA\5141711383040.2 1
Date:---------
EXHIBITC
RENEWAL NOTICE
Re: Lease dated as of ___ , 2018, by and between City of Alameda, as Landlord, and _________ ,a , as Tenant.
Dear _______ _
In accordance with Section 3.4 (a) of the above referenced Lease, by this notice Tenant hereby irrevocably exercises its Renewal Option for the Renewal Term, at the Renewal Rate and upon the terms and conditions specified in Section 3.4.
Sincerely:
[Name of Tenant]
By:---·-------·---
Its:
[Exhibit Do not sign]
CffA\51417\1383040.2 1
EXHIBITD
GUARANTY
IN CONSIDERATION of and as an inducement for the granting, execution and delivery of the Lease Agreement (the "Lease") by and between CITY OF ALAMEDA, a charter city and municipal corporation ("Landlord") and PLAY HOUSE, LLC, a California limited liability company, d/b/a Director's Cut ("Tenant") for those certain premises known as 2319 Central Avenue, alameda, CA, contain ng approximately 1,850 square feet and located in the Historic alameda Theater Building (the "Premises"), the undersigned, HUSAM HAD DA and JOE DABIT (collectively "Guarantors"), hereby covenants and agrees as follows:
1. Guarantors unconditionally and irrevocably guarantee to Landlord the full and prompt payment of the Lease Amounts (as defined in Paragraph 2 below) and hereby unconditionally and irrevocably guarantee the full, faithful and timely performance and observance of all .the covenants, terms, conditions and agreements required to be performed and observed by Tenant under the Lease and any amendment, modification or renewal thereof.
2. Guarantors hereby covenant and agree to and with Landlord that if a default shall at any time be made by Tenant in the payment of any such Lease Amounts, or ifTenant should default in the performance and observance of any of the terms, covenants, provisions or conditions contained in the Lease or, should any such Lease Amounts not be paid or terms, covenants, provisions and conditions not be performed in the event of a Financial Proceeding (as defined in Paragraph 10 below), Guarantors shall and will forthwith pay such Lease Amounts, and shall and will forthwith pay all Lease Amounts that (a) may arise in connection with the Lease and/or any enforcement of this Guaranty, or (b) would have accrued under the Lease but for the commencement of a Financial Proceeding. "Lease Amounts" means all monetary obligations of Tenant to Landlord pursuant to the Lease and any and all other sums and charges payable by Tenant under the Lease, together with all damages, late charges, interest, costs, fees, attorneys' fees and expenses incurred or suffered by Landlord as a result of non-payment of any such amounts.
3. Guarantors' obligations under this Guaranty shall be binding on Guarantors' successors and assigns. All references in this Guaranty (a) to Landlord and Tenant shall include their successors, assigns or subtenants, as the case may be, (b) to Tenant, shall also include any entity created by or pursuant to any Financial Proceeding; and (c) to Tenant, shall include any successors in interest to Tenant (whether or not directly succeeding Tenant) by reason of an Event of Reorganization (as defined in Paragraph 10 below).
4. The provisions of the Lease may be changed by agreement between Landlord and Tenant without the consent of or notice to Guarantors. The provisions of the Lease may be changed by agreement between Landlord and any permitted assignee of Tenant or any subsequent assignee without the consent of or notice to Guarantors. The Lease may be assigned by Landlord or Tenant, and the Premises, or a portion thereof, may be sublet by Tenant, all in accordance with the provisions of the Lease, without the consent of or notice to Guarantors. This Guaranty shall guarantee the performance of the Lease so assigned. Without limiting the generality of the foregoing, Guarantor waives the rights and benefits of California Civil Code Sections 2819 and CIT AIS 141711383040.2
2820 with respect to any change to the Lease between Landlord and Tenant, and with respect to any change to the Lease between Landlord and any permitted assignee of Tenant or any subsequent assignees, and agrees that by doing so Guarantors' liability shall continue even if (a) Landlord and Tenant alter any Lease obligations, or Landlord and any permitted assignee of Tenant or any subsequent assignees alter the Lease obligation, or (b) Guarantors' remedies or rights against Tenant are impaired or suspended without Guarantors' consent by such alteration of Lease obligations.
5. This Guaranty and Guarantors' obligations hereunder shall continue and remain in full force and effect notwithstanding Landlord's failure or delay from time to time to enforce any of its rights under the Lease or this Guaranty.
6. If Tenant breaches or otherwise is in default under the Lease, Landlord may proceed against Guarantors or Tenant, or all of them, or Landlord may enforce against either or both Guarantors (individually or jointly) or Tenant any rights that Landlord has under the Lease, in equity or under applicable law. If the Lease terminates and Landlord has any rights against Tenant after termination, Landlord may enforce those rights against Guarantors, without giving previous notice to Tenant or Guarantors. Guarantors here by agree that no notice of default need be given to Guarantors, it being specifically agreed and understood that this Guaranty of the undersigned is a continuing guarantee under which Landlord may proceed forthwith and immediately against Tenant or against Guarantors following any breach or default by Tenant.
7. Guarantors hereby waive all benefits and defenses under California Civil Code Sections 2808, 2809, 2810, 2819, 2845, 2848, 2849 and 2850, including without limitation: (a) the right to require Landlord to proceed against Tenant, proceed against or exhaust any security that Landlord holds from Tenant, or pursue any other remedy in Landlord's power; (b) any defense to its obligations hereunder based on the termination of Tenant's liability; (c) all presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, and notices of acceptance of this Guaranty; and ( d) all notices of the existence, creation, or incurring of new or additional obligations. Landlord shall have the right to enforce this Guaranty regardless of the acceptance of additional security from Tenant and regardless of the release or discharge of Tenant by Landlord or by others, or by operation of any law.
8. The obligations of Tenant under the Lease to execute and deliver estoppel certificates and applicable financial statements, if any, shall be interpreted to also require such documents from Guarantor and in the time periods prescribed in the Lease, except that such certificates and statements shall be with regard to the Guaranty, not the Lease.
9. Guarantors' liability hereunder shall continue until all sums due and owing Landlord under the Lease have been paid and all obligations of Tenant to be performed under the Lease have been performed, all to the satisfaction of Landlord.
10. The obligations of Guarantors under this Guaranty shall remain in full force and effect and Guarantors shall not be discharged by any of the following events with respect to Tenant or Guarantor: (a) insolvency, bankruptcy, reorganization arrangement, adjustment, composition, assignment for the benefit of creditors, liquidation, winding up or dissolution (each, a "Financial Proceeding"); (b) any merger, acquisition, consolidation or change in entity structure, or any CIT A\51417\1383040.2 2
sale, lease, transfer, or other disposition of any entity's assets, or any sale or other transfer of interests in the entity (each, an "Event of Reorganization"); or (c) any sale, exchange, assignment, hypothecation or other transfer, in whole or in part, of Landlord's interest in the Premises or the Lease. Nothing in this Paragraph 10 shall diminish the effect of any subsequent written agreement between Guarantors and Landlord.
11. Guarantors hereby represent and warrant that each has executed this Guaranty based solely on its independent investigation of Tenant's financial condition and having had the opporttmity to consult with counsel of his choosing. Guarantors hereby assume responsibility for keeping informed of Tenant's financial condition and all other circumstances affecting Tenant's performance of its obligations under the Lease. Absent a written request for such information by Guarantors, Landlord shall have no duty to advise Guarantors of any information known to it regarding such financial condition or circumstances.
12. Guarantors further agree that they may be joined in any action against Tenant in connection with the said obligations of Tenant and recovery may be had against Guarantors in any such action. Guarantors hereby expressly waive the benefits and defenses under California Civil Code Sections 2821, 2839, 2847, 2848, 2849, 2855 and, to the extent applicable, 2856 to the fullest extent petmitted by applicable law. Guarantors agree not to exercise any right of subrogation or reimbursement against Tenant until after all amounts due and owing under the Lease have been paid. If the foregoing waiver is determined by a court of competent jurisdiction to be void or voidable, Guarantors agree to subordinate its rights of subrogation and reimbursement against Tenant to Landlord's rights against Tenant under the Lease.
13. Guarantors hereby represent and warrant that, as of the date of the execution of this Guaranty by Guarantors, there is no action or proceeding pending or, to Guarantors' knowledge after due inquiry, threatened against Guarantors, or either of them, before any court or administrative agency which could adversely affect the Guarantors' financial condition. The foregoing representation and warranty shall survive the execution and delivery of this Guaranty and is expressly made for the benefit of Landlord, and Landlord's partners, lenders, representatives, successors and assigns.
14. This Guaranty shall be one of payment and performance and not of collection. If there is more than one undersigned Guarantor, the term Guarantor, as used herein, shall include and be binding upon each and every one of the undersigned, and each of the undersigned shall be jointly and severally liable hereunder. If there is more than one undersigned Guarantor, Landlord shall have the right to join one or all of them in any proceeding or to proceed against them in any order.
15. Guarantors shall indemnify, defend (with counsel acceptable to Landlord), protect and hold hatmless Landlord, and Landlord's partners, lenders, representatives, successors and assigns from and against all liabilities, losses, claims, demands, judgments, expenses and costs (including all attorneys' fees and costs to enforce any of the terms of this Guaranty or otherwise awarded hereunder) arising from or in any way related to any failure by Tenant or Guarantors to pay Rent and any and all other sums and charges payable by Tenant under the Lease, or to fully, faithfully and timely perform and observe all the covenants, terms, conditions and agreements required to be performed and observed by Tenant under the Lease.
CIT A\51417\1383040.2 3
16. The te1m "Lease" whenever used in this Guaranty shall be deemed, and interpreted so as, to also include any renewals or extensions of the initial or renewal term(s), as the case may be, and any holdover periods thereunder.
17. All demands, notices and other communications under or pursuant to this Guaranty shall be in writing, and shall be deemed to have been duly given when personally delivered, or three (3) days after the date deposited in the United States Postal Service,first-class postage prepaid, ce11ified with return receipt requested, or the delivery date designated for overnight courier services (e.g. Federal Express), addressed to the party at the address set forth below, or at such other address as may be hereafter designated in writing by either party to the other.
Landlord:
City of Alameda
Alameda City Hall
2263 Santa Clara Ave
Alameda, CA 94501
Tel: (5 I 0) 748-4509
Attn: City Manager
Notice Copy to:
RiverRock Real Estate Group, Inc., as Agent for
City of Alameda
101 W. Atlantic Avenue
Alameda, CA 94501
Tel: (5 I 0) 749-0304
Guarantors:
[Address)
18. Guarantors hereby represent and warrant that each is duly authorized to execute and deliver this Guaranty; that this Guaranty is binding on Guarantors, and each of them, in accordance with its terms; that the terms and provisions of this Guaranty are intended to be valid and enforceable in accordance with its terms; and that the signatories to this Guaranty are duly authorized to bind Guarantors and execute this Guaranty on Guar(l!ltors' behalf.
19. Landlord may assign this Guaranty in conjunction with the assignment of all or any portion of Landlord's interest in the Lease, without the necessity of obtaining Guarantors' consent thereto, and any such assignment shall not affect, or otherwise relieve, Guarantors from their obligations or liability hereunder. Guarantors may not assign or otherwise delegate any of their rights or obligations hereunder without first obtaining Landlord's written consent thereto, which consent may be withheld in Landlord's sole discretion. The terms and provisions of this Guaranty shall inure to the benefit of Landlord and Landlord's partners, lenders, representatives, successors and assigns. Guarantors hereby acknowledges that Landlord is relying upon Guarantors' covenants, representations and warranties contained in this Guaranty in entering into CIT AIS 141711383040.2 4
the Lease with Tenant, and Guarantors hereby undertakes to perform its obligations hereunder promptly and in good faith.
20. If all or any portion of the obligations guaranteed hereunder are paid or performed and all or any part of such payment or performance is avoided or recovered, directly or indirectly, from Landlord as a preference, fraudulent transfer or otherwise, then Guarantors' obligations hereunder shall continue and remain in full force and effect as to any such avoided or recovered payment or performance.
21. All representations and warranties by Guarantors contained herein or made in writing pursuant to this Guaranty are intended to and shall remain true and correct as of the time of execution of this Guaranty, shall be deemed to be material, shall su~ive the execution and delivery of this Guaranty, and shall be relied upon by Landlord and Landlord's partners, lenders, representatives, successors and assigns.
22. Guarantors acknowledge and agree that California is the situs of (i) the negotiation of the Lease and this Guaranty, (ii) the execution and delivery of the Lease and this Guaranty, (iii) the payment of any amounts due under the Lease and this Guaranty, (iv) the principal office of Guarantor, (v) the place of residence of Guarantors, and (vii) the principal office of Landlord.
Therefore, this Guaranty shall be governed by and construed in accordance with the laws of the State of California, irrespective of its conflict of law rules. In addition, Guarantors hereby consents to the jurisdiction of any state or federal court located within the County in which the Premises are located and irrevocably agrees that all actions or proceedings arising out of or relating to the Lease and this Guaranty shall be litigated in such courts. Guarantors accept generally and unconditionally, the nonexclusive jurisdiction of the aforesaid courts and waives any defense of forum non conveniens, and irrevocably agrees to be bound by any judgment rendered thereby in connection with this Guaranty. This Guaranty shall be subject to all valid applicable laws and official orders, rules and regulations, and, in the event this Guaranty or any portion thereof is found to be inconsistent with or contrary to any such laws or official orders, rules or regulations, the latter shall be deemed to contrnl, and this Guaranty shall be regarded as modified and shall continue in full force and effect; provided, however, that nothing herein contained shall be construed as a waiver of any right to question or contest any such law, order, rule or regulation in any forum having jurisdiction in the Premises.
23. This Guaranty and any exhibits hereto constitute the entire agreement between the parties with respect to the matters covered herein and supersedes all prior agreements and understandings between the parties hereto relating to the subject matter hereof.
24. In the event a Guarantor fails to perform any of his obligations under this Guaranty or in the event a dispute arises concerning the meaning or interpretation of any provision of this Guaranty, the defaulting party or the party not prevailing in such dispute, as the case may be, shall pay any and all costs and expenses incurred by the other party in enforcing or establishing its rights hereunder, including, without limitation, court costs, expert fees, and reasonable attorneys' fees.
25. Guarantors covenant and agree that, from and after the date of this Guaranty, Guarantors shall not remove or withdraw and/or cause the removal or withdrawal of any of Guarantors' CIT A\5141711383040.2 5
assets from the State of California without Landlord's prior written consent, which consent may be withheld by Landlord in Landlord's reasonable discretion.
26. Time is of the essence of this Guaranty.
27. The obligations and liabilities of each Guarantor hereunder shall be joint and several. In the event one or more Guarantors fails to execute and deliver this Guaranty to Landlord or is otherwise partially or fully released of its obligations and liabilities under this Guaranty, such failure or release shall not release any other Guarantor which executed and delivered this Guaranty from, or diminish, impair, reduce or adversely affect, any such Guarantor's obligations and liabilities under this Guaranty. It is acknowledged by each Guarantor that it may be required to pay the Guaranteed Obligations in full without assistance or support of any other party or Guarantor.
28. This Guaranty and the obligations of JOE DABJT hereunder shall continue and remain in full force and effect through the sixtieth (60th) full calendar month of the Term. Except for any obligations arising hereunder during the first sixty (60) months of the Term, which shall be continuing, this Guaranty, as to JOE DABIT only shall be deemed to have expired effective as of the last day of the sixtieth (60th) month of the Term. This Guaranty as to I·illSAM HADDAD, shall remain in full force and effect throughout the entire Term of the Lease.
IN WITNESS WHEREOF, Guarantors have executed this Guaranty as of __ , _2018
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