Building 169
CITA\51417\1017518.4
LEASE AGREEMENT
BY AND BETWEEN
CITY OF ALAMEDA,
a charter city and municipal corporation
AS LANDLORD
and
WILLIAMS-SONOMA, INC.,
ACTING FOR AND ON BEHALF OF
WILLIAMS-SONOMA STORES, INC.
a Delaware corporation
AS TENANT
TABLE OF CONTENTS
1. DEMISE •••.••••••••••.•...••••••••....••••.....•••.•••••••••••••••.••••••••••••.••••••••••••••••.•••••••••••••••••••.•..•••.•••.•••.•.• 1
1.1 Lease Agreement ..................................................................................................... 1
1.2 Termination of License ............................................................................................ 1
2. PREMISES ••.••..•.•••.••••.•••.••••••••••••••••••••••.••••••.•.••••••.••.••••••.••.••.•.•.•..•••...•.•.••..••.••••..•.•••.•••.••.••••• 1
2.1 Premises ................................................................................................................... 1
2.2 Land and Parking ..................................................................................................... 1
2.3 [Intentionally Omitted] ........................................................................................... .2
2.4 Possession ................................................................................................................ 2
2.5 Landlord's Reserved Rights ..................................................................................... 3
3. TERM ••...•••••••••••..•••••••••.••••...•.......•••••.••••••.•.•.•.••••••••••.•••••.••••••.•••••.••••••.••••..••.•••.••.••..•...••....•. 3
3.1 Term ......................................................................................................................... 3 3 .2 Delay and Delivery .................................................................................................. 4
4. RENT .••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••• 4
4.1 Base Rent .................................................. ............................................................... 4
4.2 Additional Rent ........................... ............................................................................. 4
4.3 Late Charge ............................................................................................ .................. 4
4.4 Interest ...................................................................................................................... 4
4.5 Sales Taxes ............................................................................................................... 5
5. OPERATING EXPENSES AND TAXES •..•••.••••••••••••.•..•.•.••••••••••.••••••••.•••.•..••••••.••..••.•..••••.•••••••• 6 5 .1 Definitions ................................................................................................................ 6
5.2 Determination and Payment of Operating Expenses and Taxes ........ ......... ............. ?
6. USE; COJ\1PLIANCE WITH LAWS •••••..•••••••••••.•.•.••••.•.•.•••••••••••........•.......•••••..•••..••••.•.•..•.•....•• 8
6.1 Use ........................................................................... .. .............................................. 8
6.2 Compliance with Laws ............................................................................................ 8
6.3 Compliance with Restrictions ............................... .. ................................................. 8
6.4 Use Permit ................................................................................................................ 9
7. SECURITY DEPOSIT •••..••••..••••..•••••••..•.•••....•..•••••.••..••...•........•.•.......•..........•..•...•.•..••.••••••••.•• 9
8. UTILITIES •••.••..•.•••••.••••••.•...............•••.••..•.••••.•.•••....•.••.•••••..........•.•....•...•...•••.•.•.•....•....••••.•••• 9
8.1 Payments for Utilities and Services ......................................................................... 9
8.2 No Liability ofLandlord ........................................................................................ 10 CIT A \51417\1017518.4
TABLE OF CONTENTS
(CONTINUED)
9. PERSONAL PROPERTY AND POSSESSORY INTEREST TAXES ••••••••••••.•..•.•••••••••••••••.•••.•••••• 10
9.1 Tenant's Tax Obligation ........................................................................................ 10 9 .2 Personal Property Taxes ........................................................................................ 10 9 .3 Possessory Interest Taxes ...................................................................................... 10 9 .4 Payment .................................................................................................................. 10
10. ALTERATIONS •.••••••••...••..•...•..••••..•....•..•.•••••••.•..•••.•••••.•••••••••.••••••.•.••••.•••••.•.•.•.•••..•...•••..••..• 11
10.1 Landlord Consent Required ................................................................................... 11
10.2 Alterations .............................................................................................................. 11 10 .3 Excavations ............................................................................................................ 12
10.4 Liens ....................................................................................................................... 13
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 Requir.ed 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 ................................................................................................ 18 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 ..................................................................... .19 CITA\51417\1017518.4 II
TABLE OF CONTENTS
(CONTINUED)
14. INDEMNITY AND WAIVER OF CLAIMS •••.•••.•••••••.•••••••••••.•.••••.•••••••••••.•.•••••••••••.•.••••••...•••... 20
14.1 Tenant Indemnification .......................................................................................... 20
14.2 Waiver of Claims ................................................................................................... 20
14.3 Survival/No Impairment ........................................................................................ 21
15. INSURANCE •••••.••.••..•..••.••••••.•.•...••.•.•...•••..••.••.•..••.•.•••.•••••••.•••••••••..••.••••••••.••..•.••••.•.••••...••.•• 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 ............................................................................................. 23
16. DAMAGE OR DESTRUCTION ••••.•••.••••••.•••.•••.••••••••••.••.••••••.••..•.•••..••.•.••.••••••••••••••.••••••...•.•••• 23
16.1 Definitions .............................................................................................................. 23
16.2 Partial Damage - Insured Loss ............................................................................... 24
16.3 Partial Damage - Uninsured Loss .......................................................................... 24
16.4 Total Destruction ................................................................................................... 24
16.5 Damage Near End ofTerm ............................................................ ....................... .25
16.6 Abatement of Rent ................................................................................................. 25
17. CONDEJ\fflATION •••••••••••••••.••••••.••..•.••.••..••.•••••••.....••.••..•.....•..•...•••.....•.••.......••••••.....•...•.••••• 25
18. DEFAULT •••....•••.......••.••.••.•.•..•.••••••.••••..••.•.••..••••••.••.•...•••.•••••.••..•••.•••.••••••.•.•.•.•••.•.•••.•••••••.•• 26
18.1 Events of Default ................................................................................................... 26
18.2 Remedies ................................................................................................................ 27
18.3 No Waiver .......................................................................................... .................... 28
18.4 Waiver of Redemption, Reinstatement, or Restoration ......................................... 28
18.5 Remedies Cumulative ............................................................................................ 28
18.6 Landlord's Right to Perform Tenant's Obligations ............................................... 28
18.7 Severability ................... ~ ................................................ ........................................ 28
19. LIMITATION OF LIABILITY ••.••••••.•••••.•.••..•••.•••.••••.••.••••••.•.•..••••••.•••••••••••••••••..•.•...••..••..•••••. 29
20. SURRENDER OF PREMISES .•.•..•..•••.•••.•••.••.•••••••••••••••••••.•.•••••.•..•••••.••.••..•••••.•.••...•.•••.••.•.••••• 29
21. HOLDING OVER •••••.•••.••••••••••••••.•••.•••••.••••••••••..••••••..•..•...•.•••.•..•.•..••••••.•••••••••••••••••••.••.•.•••.. 29
22. MORTGAGES ...•.••.•••••••••••••••••••..••••••••.•••.•..••.•••.•••.••...•.••..••..••••.•.•••.•••.••••••••.••••••••.•••••••••••••• 30
22.1 Subordination to Mortgages ................................................................................... 30 CITA\51417\1017518.4 iii
TABLE OF CONTENTS
(CONTINUED)
22.2 Mortgage Protection ............................................................................................... 30
23. TENANT'S ESTOPPEL CERTIFICATE ••••••••••••.•.•••••••••..•••••••••••••.•••••••...•••••.••••.•••••.•..•••..•••••. 30
24. RELOCATION •••••...•.•.••••.•••••..••.••••••••••••.••••.•...•.••.••..•..•• ERROR! BOOK1\1ARK NOT DEFINED.
25. NOTICE ••••••••.•••••.•••••••••••.•••••.••••••••••...•.••.••.•..••.....•.••••.•.••.••••••••.•.••.•..•••••••.•••.••••.•••••..•••••...• 31
26. LABOR PROVISIONS •.••••••••••.•••••••••••.••••••••••••.•...•••......••.•..•••••..••.•.•.••.•••••••.••••••.•••••••.•••.•••... 31
26.1 Equal Opportunity .................................................................................................. 31
26.2 Convict Labor ........................................................................................................ 32
26.3 Prevailing Wages and Related Requirements ........................................................ 32
27. MISCELLANEOUS ••.•.•......•..•..••.•.••.•••.•••••••.••••••••••.••.•••••••••••••..•••••••.•••.•••.••••••••••.•..••...••.••.•.• 32
27.1 Governing Law ........................................................................... ~ .......................... 32
27.2 Severability ............................................................................................................ 32
27.3 Attorneys' Fees ...................................................................................................... 32
27.4 Force Majeure ........................................................................................................ 33
27.5 Sale ......................................................................................................................... 33
27.6 Signs ....................................................................................................................... 33
27.7 Brokers ................................................................................................................... 33
27.8 Access by Landlord ................................................................................................ 33
27.9 Waiver of Right to Jury Trial.. ............................................................................... 34
27.10 Recordation ............................................................................................................ 34 27 .11 Article and Section Titles ....................................................................................... 34
27.12 Authority ................................................................................................................ 34
27.13 Quiet Possession .................................................................................................... 35
27.14 Asbestos Notification for Commercial Property Constructed Before 1979 .......... 35
27.15 Lead Warning Statement ........................................................................................ 35
27.16 OFAC Certification ................................................................................................ 35 2 7 .1 7 Certified Access Specialist Disclosure .................................................................. 3 5
27.18 Time of the Essence ............................................................................................... 36
27.19 Entire Agreement ................................................................................................... 36
27.20 Rules and Regulations ............................................................................................ 36
27.21 Financial Statement ................................................................................................ 36 CITA\51417\1017518.4 IV
TABLE OF CONTENTS
(CONTINUED)
2 7 .22 Relocation Benefits ................................................................................................ 3 6
27.23 Alameda NAS Historic District ............................................................................. 37
27.24 Subdivision and Development of Property ............................................................ 37
27.25 Environmental and Planning Documents ............................................................... 37
27.26 Counteiparts ........................................................................................................... 37 CITA\51417\1017518.4 v
INDEX OF EXHIBITS
Exhibit
A PREMISES
A-1 PRIMARY PARKING AREA
A-2 OVERFLOW PARKING AREA
A-3 ALTERNATIVE OVERFLOW PARKING AREAS
B COMMENCEMENT LETTER
c [Intentionally Omitted]
D ACKNOWLEDGMENTOFRECE~T
E ENVIRONMENTAL QUESTIONNAIRE
F RULES AND REGULATIONS
G. TENANT WORK LETTER
CITA\51417\1017518.4
LEASE AGREEMENT
BASIC LEASE INFORMATION
Lease Date: Dated as of January_, 2017 for reference purposes only 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
Notice Copy to:
RiverRock Real Estate Group, Inc., as Agent for
City of Alameda
950 W. Mall Square, suite 239
Alameda, CA 94501
Tel: (510) 749-0304
Tenant: Williams-Sonoma, Inc., a Delaware corporation, acting for and on behalf of Williams-Sonoma Stores, Inc.
Tenant's Address: Williams-Sonoma, Inc.
Attention: Lease Administration
3250 Van Ness Avenue
San Francisco, CA 94109
Notice Copy to:
Williams Sonoma, Inc.
Attention: Senior Vice President, Real Estate
3250 Van Ness Avenue
San Francisco, CA 94109
Premises: Those certain premises located at 1680 Viking St., Suite 102, Building 169, Alameda, CA consisting of approximately 43,355 rentable square feet as depicted on Exhibit A
Building: 169
CITA \51417\1017518.4 2
Length of Term: Thirty-six (36) months
Estimated Commencement
Date: May 1, 2017
Estimated Expiration Date: April 30, 2020
Extension Option: None
Base Rent: Months Monthly Base Rent
1-12 $21,677.50
13-24 $21,677.50
25-36 $21,677.50
Capital Repair Credit: An amount not to exceed $30,000, as set forth in the Tenant Work Letter, attached as Exhibit G
Taxes and Utilities: Tenant shall pay all costs for services and utilities to the Premises, as defined in the Lease. Tenant shall pay all taxes (including possessory interest taxes) levied on or against the Premises or its personal property.
Tenant's Share: 50%
Security Deposit: $21,677.50
Permitted Use: Retail sale, at full price and/or a discount, of products for home furnishings and embellishment, including without limitation, furniture, lighting, bathroom fixtures and fittings, home kitchen accessories, books, fine tools and gadgets for the home, and other items which are ancillary and complementary thereto, together with such other merchandise as may from time to time be sold in Tenant's stores, Tenant's catalog, and/or Tenant's website under the trade names of (i) "Williams-Sonoma", (ii) Pottery Barn (iii) Pottery Barn Kids, (iv) West Elm, (v) Rejuvenation, and (vi) such other trade name that may be used by Tenant from time to time Parking: Tenant shall have the right, on a non-exclusive basis, in common with other tenants, to have its employees and visitors park in the paved areas adjacent to the Buildings as identified as the Primary Parking Areas on Exhibit A-1 and Overflow Parking Areas as identified on Exhibit A-2, both attached hereto, as further set forth in Section 2.2 herein below
CITA\51417\1017518.4 3
CITA\51417\1017518.4
Brokers: Cushman & Wakefield (Landlord Broker) and Retail West, Inc. (Tenant Broker)
4 LEASE AGREEMENT
THIS LEASE AGREEMENT is made and entered into by and between CITY OF ALAMEDA, a charter city and municipal corporation ("Landlord") and WILLIAMSSONOMA, INC., a Delaware corporation, acting for and on behalf of Williams-Sonoma, Inc. ("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 Termination of License. Tenant currently occupies the Premises under a License Agreement dated May, 2016 as amended, between the City of Alameda 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 Commencement Date hereof, except those indemnification obligations which survive the termination of the License for claims occurring prior to the date of this Lease, and any other obligations which expressly survive the expiration of the Term of the License.
Tenant's continued use and occupancy of the Premises shall be pursuant to the terms of this Lease.
2. PREMISES.
2.1 Premises. The Premises demised by this Lease are as specified in the Basic Lease Information. Said Premises are located on property commonly referred to as the former Naval Air Station Alameda ("Property"). The Premises have the address and contain the square footage specified in the Basic Lease Information; provided, however, that any statement of square footage set forth in this Lease is an approximation which Landlord and Tenant agree is reasonable and no economic terms based thereon shall be subject to revision whether or not the actual square footage is more or less. Tenant shall, at its own cost and expense, be entitled to maintain existing identity signage on the Premises and temporary A-frame signs in locations in the former Na val Air Station Alameda as may be reasonably agreed upon by Landlord and Tenant. Tenant shall remove such signs upon expiration or earlier termination of the Lease and shall repair any damage caused by such removal.
2.2 Land and Parking. In addition to the Premises, Landlord grants to Tenant a nonexclusive license for Tenant and its employees, agents, suppliers, customers and patrons the right to use those portions of the land designated on Exhibit A-1 as the "Primary Parking Area" for parking purposes. Tenant and its employees, agents, customers and patrons may also utilize for overflow parking in the lot depicted on Exhibit A-2 (the "Overflow Parking Area").
On the days that it utilizes the Overflow Parking Area, Tenant shall have on site personnel dedicated to traffic and parking control. (The Primary Parking Area and Overflow Parking Area are collectively referred to as the "Parking Areas"). Tenant shall, within the first ten (10) CITA\51417\1017518.4
business days of the Term, fence those portions of the Overflow Parking area where active monitoring wells are located, as so designated in Exhibit A-2. Tenant shall have the sole responsibility for maintaining the Overflow Parking Area. Landlord may, upon not less than thirty (30) day's prior written notice, require Tenant to relocate the Overflow Parking Area to either one of the two alternative Overflow Parking Areas outlined in blue on Exhibit A-3 (the "Alternative Overflow Parking Areas"). Landlord may select either of the possible relocation sites at its discretion. If Landlord exercises its right to relocate the Overflow Parking Area to one of the Alternative Overflow Parking Areas, said relocation site shall henceforth be the Overflow Parking Area, Tenant's use of which shall be governed by the terms and conditions of this Section 2.2. Tenant may also use the Primary Parking Area for the loading and unloading of trucks shipping items to and from the Premises. Landlord shall not be required to enforce Tenant's rights to use any parking spaces on the Parking Areas. Landlord reserves the right, from time to time, to stripe, restripe or otherwise designate those areas of the land adjacent to the Building (exclusive of the Parking Areas) which may be used for parking purposes. Under no circumstances may the Parking Areas be utilized for the storage (beyond 72 hours), repair or maintenance of any vehicles. Should Tenant or its agents, employees or invitees use the Parking Areas or any portion thereof in violation of this Section 2.2, Landlord shall have the right, without notice, in addition to such other rights and remedies that it may have, to tow away any vehicle involved and charge the cost of towing and storage to Tenant, which cost shall be immediately payable upon demand by Landlord as Additional Rent. Neither Landlord nor any Landlord Related Party (as defined in Section 14.1 below) shall be liable for: (a) loss or damage to any vehicle or other personal property parked or located upon or within the Parking Areas, whether pursuant to this license or otherwise and whether caused by fire, theft, explosions, strikes, riots, or any other cause whatsoever; or (b) injury to or death of any person in, about or around any parking spaces or any portion of the Parking Areas or any vehicles parked thereon whether caused by fire, theft, assault, explosion, riot or any other cause whatsoever and Tenant hereby waives any claims for, or in respect to, the above. Tenant shall not assign any of its rights under this Section 2.2 except in connection with an assignment of Tenant's interests in the Lease or a sublease in accordance with Article 13 below and in the event an attempt to assign is made, it shall be void. Landlord shall have no maintenance obligations for the Parking Areas and all provisions of this Lease concerning Tenant's rights and obligations governing its use and occupancy of the Premises that are not inconsistent with this Section 2.2 shall be applicable to the Parking Areas. In addition to the foregoing, if Tenant desires storage rights or other such uses of the Parking Areas, Tenant shall provide a narrative written description and plans showing such uses for Landlord's review and approval. If Tenant obtains Landlord's approval for outside storage or other uses, the same shall be properly screened.
2.3 [Intentionally Omitted].
2.4 Possession. Tenant acknowledges that it has been in possession of the Premises and Parking Areas under the License and that the same are in satisfactory condition and repair.
Tenant remains in possession of the Premises in "AS IS" "WITH ALL FAULTS" condition and configuration without any representations or warranties by Landlord, and subject 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 warranty with respect to the suitability of the Premises, Building, Parking Area, or infrastructure for the conduct of Tenant's CITA\51417\1017518.4 2
business. Landlord shall not be liable for any latent or patent defects in the Building, Parking Area or Premises. Tenant shall be responsible for requesting an inspection and obtaining a Certificate of Occupancy from the City of Alameda. 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.
2.5 Landlord'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, and Common Areas (if any) 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 and parking areas, drive isles, landscaping, curb cuts and paved and unpaved portions of the exterior Common Areas. 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 visibility of or access to the Premises, or ingress and egress to the Premises, or ( c) materially reduce the number of parking spaces in the Parking Areas or materially, adversely impair access to the Parking Areas. 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 (1) 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 thirty-sixth (36th) 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; if Tenant fails to execute and deliver such letter agreement to Landlord within ten (10) 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. If this Lease is disapproved by the City Council, then this Lease will automatically be rescinded, in which event this Lease shall be rendered null and void and without legal force or effect. If this Lease is not approved by the City Council on or before April 30, 2017, then at any time thereafter prior to such approval, Tenant may rescind this Lease by notice to Landlord, in which event this Lease shall be rendered null and void and without legal force or effect. If the Commencement Date has not occurred by April 30, 2018, then this Lease will CITA\51417\1017518.4 3
automatically be rescinded, in which event this Lease shall be rendered null and void and without legal force or effect.
3.2 Delay and Delivery. Landlord and Tenant acknowledge that Tenant has been in possession of the Premises and Parking Areas under the License.
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 setoff or deduction and without further notice or demand, the monthly installments of rent specified in the Basic Lease Information ("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 Term shall be prorated based upon a thirty (30) day calendar month.
(b) Capital Repair Credits. Tenant represents and warrants to Landlord that it intends to undertake certain Capital Repairs to the Premises (as defined in the Tenant Work Letter (Exhibit G)), the total cost for which will equal or exceed the total Capital Repair Credit Amount (as defined in the Tenant Work Letter). Such representation by Tenant is a material element of consideration for Landlord's decision to enter into this Lease under the terms and conditions set forth herein. As partial consideration for such representation, Landlord shall grant Tenant a Capital Repair Credit to be awarded in the form of Monthly Base Rent Credits in an amount not to exceed $2,500 per month, all as defined in the Tenant Work Letter.
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, if any. 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 Charge. Other remedies for non-payment of Rent notwithstanding, if any 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 Interest. 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 CITA\51417\1017518.4 4
percent (10%) per annum. Payment of such interest shall not excuse or cure any Default by Tenant.
4.5 Sales Taxes. As partial consideration for this Lease, Tenant agrees to book and record all items sold from the Premises as sales originating within the City of Alameda. Within thirty (30) days after the end of each calendar month of the Term, Tenant shall provide Landlord with a report showing the Gross Sales from the Premises for said month. For purposes of said reporting, "Gross Sales Revenue" shall mean the total taxable and nontaxable sales originating from the Premises that have been or will be reported to the California Board of Equalization.
The term "Gross Sales" shall mean all revenue of Tenant and any concessionaries and all other receipts or receivables whatsoever from all business and other activities conducted in, upon or from the Premises or other such sales or other receipts as may be evidenced by check, cash, credit, open account, charge account, exchange or otherwise, and shall include, but not be limited to, amounts received from any sale of goods, wares and merchandise (including gift and merchandise certificates) and for services performed on or at the Premises, together with the amount of all orders taken from the Premises regardless of whether delivery is made from some other location. Notwithstanding anything in this Section 4.5 to the contrary, Gross Sales shall not include (i) the exchange of merchandise between stores of the Tenant where such exchanges are made solely for the convenient operation of the Tenant's business and not for the purpose of consummating a sale which has theretofore been made at, in, on or from the Premises and/or for the purpose of depriving the Landlord of the benefit of a sale which otherwise would have been made at, in, on or from the Premises; (ii) returns to shippers, jobbers, wholesalers, or manufacturers; (iii) sales of fixtures after use thereof in the conduct of the Tenant's business in the Premises; (iv) orders for merchandise initiated through Tenant's website, the internet or the technological evolution thereof, or from Tenant's catalogs, whether or not such orders are initiated, generated or placed from, at or in the Premises (provided such exclusion shall not be used to divert sales from the Premises and that the merchandise so ordered is not delivered from the Premises, in which case the same shall be included in gross sales); (v) cash or credit refunds made upon transactions included within gross sales, not exceeding the selling price of merchandise returned by the purchaser and accepted by the Tenant; (vi) the amount of any city, county, state or federal sales, luxury, or excise tax on such sales which is both (a) added to the selling price or absorbed therein, and (b) paid to the taxing authority by the Tenant; (vii) any sums received in settlement of claims for loss or damage to merchandise; (viii) sales to employees at a discount only to the extent such discounts do not exceed two percent (2%) of gross sales; (ix) vending machine sales and pay telephone receipts for the exclusive use of Tenant's employees; (x) amounts in excess of Tenant's cash sale price charged on sales made on credit, for cash on delivery or under a time payment plan or layaway plan, (xi) charges paid by Tenant or its customers to credit card companies and check verification companies in connection with Gross Sales Transactions (e.g., Visa and Telecheck), (xii) sale of gift certificates, gift cards and like vouchers, provided, however, that the cash sale price of any purchase with such a certificate, card or like voucher will be included in Gross Sales; (xiii) postage, delivery, courier charges paid in connection with mail order sales; (xiv) bad checks given to the Tenant by customers and returned by customers bank without payment, and any penalties or charges imposed by Tenant on its customers for returned checks; and (xv) Tenant's accounts receivables which have been determined to be uncollectible for federal income tax purposes; provided, however that such sums actually collected in later years shall be included in gross sales for such CITA \51417\1017518.4 5
later year. The obligations under this Section 4.5 for the final month of the Term shall survive the expiration or earlier termination of this Lease.
5. OPERATING 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 such 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, Land, or Common Areas, any personal property of Landlord used in the operation of the Building or Common Areas, or Landlord's interest in the Building or Common Areas, 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, 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, that 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 CITA\51417\1017518.4 6
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 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 the roof); (ii) Common Area maintenance; and (iii) Landlord's property insurance, if any.
5.2 Determination and Payment of Operating Expenses and Taxes. Tenant shall pay to Landlord as Additional Rent one-twelfth (1/12th) 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 CITA\51417\1017518.4 7
termination hereof and such Additional Rent for such period shall be payable by Tenant upon demand by Landlord.
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 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 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 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 not permit any objectionable odor to escape or be emitted from the Premises and 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 damage to property or injury to person in or about the Buildings.
6.3 Compliance with Restrictions. The Premises are located on property known as the former Naval Air Station Alameda, portions of which were conveyed to the City by the United States of America, acting by and through the Department of the Navy by a quitclaim deed dated June 4, 2013, recorded June 6, 2013 as Series No. 2013-199818 of Official Records in the Office of the County Recorder, Alameda County, California ("Quitclaim Deed"). Said Quitclaim Deed conveyed the Premises subject to certain covenants, conditions, restrictions, easements, and encumbrances as set forth therein. The Premises are further encumbered by those certain restrictions set forth in the Declaration of Restrictions (Former Naval Air Station Alameda) dated June 4, 2013 and recorded June 6, 2013 as Series No.: 2013-199782 in the Office of the County Recorder of Alameda County ("Declaration of Restrictions"). Copies of the Quitclaim Deed and Declaration of Restrictions have been delivered to Tenant and, concurrently with the execution of this Lease, Tenant shall sign and return to Landlord the Acknowledgment of Receipt, attached hereto as Exhibit D. Use of the Premises is further restricted by the Covenant to Restrict Use of Property Environmental Restrictions recorded CITA\51417\1017518.4 8
June 6, 2013 as Series No. 2013-199839 in the office of the County Recorder, Alameda County, CA (the "CRUP"), the National Environmental Protection Act Record of Decision ("ROD") for the disposal and reuse of the former Naval Air Station Alameda, and all conditions contained therein. A copy of the ROD is available for review at Landlord's office during normal business hours. The covenants, conditions, restrictions, easements, rights-of-way, reservations, rights, agreements, and encumbrances set forth in the Quitclaim Deed, Declaration of Restrictions and the ROD, as they affect the Building, Common Areas or Premises, are collectively referred to herein as the "Restrictions.'' Any use of the Premises shall comply with the Restrictions and a failure to so comply shall constitute a Default under this Lease. If Tenant is unable to use the Premises for the Permitted Use due to the Restrictions, then Tenant may terminate this Lease by notice to Landlord and this Lease shall terminate as of the date set forth in Tenant's notice, which date shall not be later than the 90th day following the date on which Landlord receives Tenant's notice
6.4 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 currently holds the sum of Twenty-One Thousand Six Hundred Seventy-Seven and 50/100 Dollars ($21,677.50) as a Security Deposit under the License. Upon the expiration of the License, Landlord shall retain said amount, without liability for interest (unless required by Law), as security for the performance of Tenant's obligations under this Lease. 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 (15) 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 thereof remaining, 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 CITA\51417\1017518.4 9
("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 shall pay to Landlord, as Additional Rent, its pro rata share of the cost of such services, 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 reasonab_le accuracy.
8.2 No Liability of Landlord. 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 .1 ( c) above.
9 .2 Personal Property 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 Term ("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 CITA\51417\1017518.4 10
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.
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 Alteration 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) are perform below the ceiling and above the raised floor of the Premises, (d) 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 ($10,000) and, (e) 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 licensed 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 shall 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 major 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 CITA\51417\1017518.4 11
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 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. Upon completion, Tenant shall furnish Landlord with at least three (3) sets of "as built" Plans (as well as a set in CAD format, if requested by Landlord) for the Alterations, completion affidavit and full and final unconditional waivers ofliens 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, if required) 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. Tenant shall be responsible for complying with the provisions of the City of Alameda's Marsh Crust Ordinance, as well as the Covenant to Restrict Use of Property Environmental Restrictions recorded June 6, 2013 as Series No. 2013- 199838 of Official Records of the County of Alameda, the Site Management Plan for Alameda Point and, if required, shall obtain a Marsh Crust Permit.
CIT A \51417\1017518.4 12
I 0.4 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 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 (I 0) 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 Tenant.
(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, aescribed in Article 1 O; (vii) heating, ventilation and air conditioning (HV AC) systems exclusively serving the Premises; (viii) 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. The forgoing notwithstanding, Tenant is not required to perform any structural or other capital repairs costing in excess of $25,000. If maintenance costing in excess of $25,000 are determined by Tenant to be required for any reason, then promptly after such determination Tenant shall either (i) notify Landlord that Tenant agrees to perform such maintenance costing in excess of $25,000 at Tenant's sole cost and expense or (ii) terminate this Lease by notice to Landlord unless, within I 0 business days of delivery of such notice Landlord provides written notice to Tenant of its intent to perform such maintenance. If Landlord fails to respond within said 10 business day period, then this Lease shall terminate as of the date set forth in Tenant's notice, which date shall not be later than the 90th day following the date on which Landlord receives Tenant's notice. (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 CITA\51417\1017518.4 13
repairs and replacements and the reasonable costs of such repairs or replacement shall be charged to Tenant as Additional Rent and shall become due and payable by Tenant within thirty (30) days after Tentative receipt of an invoice accompanied by reasonable supporting documentation.
11.2 Maintenance and Repair by Landlord. Landlord shall maintain in good repair (a) the structural elements of the Building, including structural elements of exterior walls and foundations, slabs and load bearing walls, beams, lintels and columns, but excluding any glass and exterior doors; (b) the roof of the Building; and ( c) Common Areas 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 1941 and 1942 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 make 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. ll.2 Reportable Uses Required Consent. Except as permitted 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 CITA\51417\1017518.4 14
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 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 of a remediation plan for any Tenant's Contamination, 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 CITA\51417\1017518.4 15
Materials that were not clearly introduced to the Premises by Tenant or Tenant Parties. As an example, if lead dust or asbestos are found on the Premises, unless there is clear evidence that Tenant introduced those Hazardous Materials to the Premises or they were dislodg~d 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.
12.5 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 notice 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 in accordance with this Section 12.5.
12.6 Hazardous Materials 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 throughout 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 CITA\51417\1017518.4 16
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 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 Materials 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 for 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 Landlord Consent Required. 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, (b) assign or transfer this Lease or any interest herein, sublease the Premises or any part thereof or any right or privilege appurtenant thei::eto, 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.
CITA\51417\1017518.4 17
13.2 Landlord Recapture. 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 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 and reduce rent proportionately, 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 information 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 notpermit 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.
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 reasonable brokerage commissions, reasonable attorneys' fees and reasonable advertising and marketing costs incurred by Tenant in connection with the Transfer) ("Transfer Premium").
Tenant shall pay fifty percent (50%) of such Transfer Premium to Landlord as and when the monthly payments are received by Tenant.
CITA\51417\1017518.4 18
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 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, nonbankruptcy 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 compliance by each such subtenant or assignee.
13.7 Expenses and Attorneys' Fees. Tenant shall pay to Landlord all costs and expenses (including without limitation, the fees of Landlord's counsel) incurred in connection Landlord's review and processing of documents regarding any proposed Transfer that requires Landlord's consent (which under no circumstances shall be less than $750 per proposed Transfer).
13.8 Limitations on Transfer Reasonable. Tenant acknowledges and agrees that the r.estrictions, conditions, and limitations imposed by this Article 13 on Tenant's ability to assign CITA\51417\1017518.4 19
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 thereof, 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 or Landlord's agents, employees and contractors. 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 of recovery 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 interruption or loss of income at the Premises.
14.2 Waiver of 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, ( d) any diminution o~ 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 CITA\51417\1017518.4 20
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 Survival/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.
15.1 Tenant's Insurance.
(a) Liability 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 01 96 promulgated by the Insurance Services Office. (b) Personal Property 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 Insurance; Employer's Liability Insurance. Tenant shall, at Tenant's expense, maintain in full force and effect during the Term 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 ($1,000,000.00).
CITA\51417\1017518.4 21
(d) Pollution Legal Liability. ~
' (it= Gennncrcial PoHrttil3r.t Legal Lia-bilit 9. Tenant ~fl:all Alaiattti~ ~ 0l'5ttttfteFsi8:l I?ell~iGR Legal Lia-eiliey Insaranc~ wirh ?over~g~ limits of aet less~~ 11 Tvco Mtlhun Dollars ($,,,t)t)t),OM) annual aggregate 00¥0f1H:g eltUffiS MLmtg ettt ef 011ela'f0El t0e er :f.enttM's Contamination druing the tetm sftftis Lc11Se. Stteh policy shall name tire City as an o,;.~ ~ 8:8"1i'iQRal i1iliaarss. \' ~ 1 f
(ii) Contractor's Pollution Legal Liability. Tenant shall cause any contractors retained for performing any Alterations of the Premises, the total cost of which exceed Two Hundred Thousand dollars ($200,000) to obtain and maintain Contractor's Pollution Liability Insurance covering the general contractor and all subcontractors in an amount of not less than Two Million Dollars ($2,000,000) with a maximum deductible of Ten Thousand Dollars ($10,000). Any such policy shall name the City as an additional insured. ( e) Business Interruption Insurance. Tenant shall, at Tenant's expense, maintain in full force and effect during the Term of this Lease, Business Interruption Insurance with a limit ofliability of at least twelve (12) months estimated gross earnings from the Premises, 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.
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. Landlord and Tenant agree, to the extent such waivers are commercially reasonable, to have their respective insurance companies waive any rights of subrogation that such company may have against Landlord or Tenant, as the case may be.
15 .3 Certificates of Insurance. Upon execution of this Lease by Tenant, and not less than thirty (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 force, CITA\51417\1017518.4 22
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. Tenant acknowledges that, as of the reference date of this Lease, Landlord carries no such insurance.
16. DAMAGE OR DESTRUCTION.
16. l Definitions.
(a) "Premises Partial Damage" shall mean damage or
destruction to the improvements on the Premises (or Hazardous Material Condition for which Tenant is not responsible), other than Tenant's Property (as defined at Section 15.l(b)), or Alterations (as defined at Article 10), which can reasonably be repaired in six (6) months or less from the date of the damage or destruction. Landlord shall notify Tenant in writing within thirty (30) days from the date of the damage or destruction as to whether or not the damage is Partial or Total and the estimated time for repairing said damage. Notwithstanding the foregoing, Premises Partial Damage shall not include damage to windows, doors, and/or other similar items which Tenant has the responsibility to repair or replace pursuant to the provisions of Section
11.1. (b) "Premises Total Destruction" shall mean damage or destruction to the Premises (or Hazardous Material Condition for which Tenant is not responsible), other than Tenant's Property (as defined at Section 15.l(b)), or Alterations (as defined at Article 10), which cannot reasonably be repaired in six (6) months or less from the date of the damage or destruction. Landlord shall notify Tenant in writing within thirty (30) days from the date of the damage or destruction as to whether or not the damage is Partial or Total. ( c) "Insured Loss" shall mean damage or destruction to improvements on the Premises, other than Tenant's Property (as defined at Section 15.l(b)), or Alterations (as defined at Article 10), which was caused by an event required to be covered by the insurance described in Section 15 .4, irrespective of any deductible amounts or coverage limits involved.
(d) "Replacement Cost" shall mean the cost to repair or rebuild the improvements owned by Landlord (excluding Alterations) at the time of the occurrence to their condition existing immediately prior thereto, including demolition, debris removal and upgrading required by the operation of Laws governing the Premises, and without deduction for depreciation.
( e) "Hazardous Material Condition" shall mean the
occurrence or discovery of a condition involving the presence of, or a contamination by, a Hazardous Material as (defined in Section 12.1), in, on, or under the Premises which requires repair, remediation, or restoration.
CITA\51417\1017518.4 23
16.2 Partial Damage - Insured Loss. If a Premises Partial Damage that is an Insured Loss occurs, Landlord shall repair such damage (but not Tenant's Property or Alterations) as soon as reasonably possible and this Lease shall continue in full force and effect; provided, however, that Tenant shall, at Landlord's election, make the repair of any damage or destruction the total cost to repair of which is $10,000 or less, and, in such event, Landlord shall make any applicable insurance proceeds available to Tenant on a reasonable basis for that purpose.
Notwithstanding the foregoing, ifthe required insurance was not in force or the insurance proceeds are not sufficient to effect such repair, Tenant shall promptly contribute the shortage in proceeds (except as to the deductible which is Tenant's responsibility) as and when required to complete said repairs. In the event, however, such shortage was due to the fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not commercially reasonable and available, Landlord shall have no obligation to fully restore the unique aspects of the Premises unless Tenant provides Landlord with the funds to cover same, or adequate assurance thereof, within ten (10) days following receipt of written notice of such shortage and request therefor. If Landlord receives said funds or adequate assurance thereof within said ten (10) day period, the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. If such funds or assurance are not so received, Landlord may nevertheless elect by written notice to Tenant within ten (10) days thereafter to: (a) make such restoration and repair as is commercially reasonable with Landlord paying any shortage in proceeds, in which case this Lease shall remain in full force and effect, or (b) have this Lease terminate thirty (30) days thereafter. Tenant shall not be entitled to reimbursement of any funds contributed by Tenant to repair any such damage or destruction. Premises Partial Damage due to flood or earthquake shall be subject to Section
16.3, notwithstanding that there may be some insurance coverage, but the net proceeds of any such insurance shall be made available for the repairs if made by either Party.
16.3 Partial Damage - Uninsured Loss. If a Premises Partial Damage that is not an Insured Loss occurs, unless caused by a negligent or willful act of Tenant (in which event Tenant shall make the repairs at Tenant's expense), Landlord may either: (a) repair such damage as soon as reasonably possible at Landlord's expense, in which event this Lease shall continue in full force and effect, or (b) terminate this Lease by giving written notice to Tenant within thirty (30) days after receipt by Landlord of knowledge of the occurrence of such damage. Such termination shall be effective sixty (60) days following the date of such notice. In the event Landlord elects to terminate this Lease, Tenant shall have the right within ten (10) days after receipt of the termination notice to give written notice to Landlord of Tenant's commitment to pay for the repair of such damage without reimbursement from Landlord. Tenant shall provide Landlord with said funds or satisfactory assurance thereof within thirty (30) days after making such commitment. In such event this Lease shall continue in full force and effect, and Landlord shall proceed to make such repairs as soon as reasonably possible after the required funds are available. If Tenant does not make the required commitment, this Lease shall terminate as of the date specified in the termination notice.
16.4 Total Destruction. Notwithstanding any other provision hereof, if a Premises Total Destruction occurs, this Lease shall terminate sixty (60) days following such Destruction.
If the damage or destruction was caused by the gross negligence or willful misconduct of Tenant, Landlord shall have the right to recover Landlord's damages from Tenant.
CITA\51417\1017518.4 24
16.5 Damage Near End of Term. If at any time during the last six (6) months of this Lease Term (or the last 6 months of any Renewal Term) there is damage for which the cost to repair exceeds one month's Base Rent, whether or not an Insured Loss, Landlord may terminate this Lease effective sixty (60) days following the date of occurrence of such damage by giving a written termination notice to Tenant within thirty (30) days after the date of occurrence of such damage. Notwithstanding the foregoing, if Tenant at that time has an exercisable option to extend this Lease or to purchase the Premises, then Tenant may preserve this Lease by (a) exercising such option and (b) providing Landlord with any shortage in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is ten (10) days after Tenant's receipt of Landlord's written notice purporting to terminate this Lease, or (ii) the day prior to the date upon which such option expires. If Tenant duly exercises such option during such period and provides Landlord with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Landlord shall, at Landlord's commercially reasonable expense, repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. If Tenant fails to exercise such option and provide such funds or assurance during such period, then this Lease shall terminate on the date specified in the termination notice and Tenant's option shall be extinguished.
16.6 Abatement of Rent. In the event of Premises Partial Damage, Premises Total Destruction or Hazardous Material Condition for which Tenant is not responsible under this Lease, the Rent payable by Tenant for the period required for the repair, remediation or restoration of such damage shall be abated in proportion to the degree to which Tenant's use of the Premises is impaired, and such abatement shall be Tenant's sole remedy for such impairment of use. All other obligations of Tenant hereunder shall be performed by Tenant, and Landlord shall have no liability for any such damage, destruction, Hazardous Material Condition, remediation, repair or restoration except as provided herein.
16.7 Tenant Termination Right. Notwithstanding anything to the contrary in this Article, in the event of a casualty rendering the Premises unsuitable for the Permitted Use, such that Tenant is unable to operate its business from the Premises, Tenant may, by notice to Landlord within thirty (30) days after such casualty, terminate this Lease as this Lease shall be deemed terminated as of the date of the casualty.
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 or Tenant'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 either Landlord or Tenant may, at its option, terminate this Lease as of the date possession vests in the condemning party. If twentyfive percent (25%) or more of the Premises is taken and ifthe Premises remaining after such Taking and any repairs by Landlord would be untenantable (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 CITA\51417\1017518.4 25
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 subj~ct 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.
18. DEFAULT.
18. l 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 herein below.
( 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 CITA\51417\1017518.4 26
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 right to 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;
(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 loss 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 referred 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 annum rate of interest permitted from time to time under applicable law, or (B) the Prime Rate plus 5% as determined by Landlord. (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, if Tenant 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 CITA\51417\1017518.4 27
time thereafter as Landlord may elect in writing, to terminate this Lease and Tenant's right 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 pai1icular 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 Restoration. Tenant hereby waives any and all rights conferred by Section 3275 of the Civil Code of California and by Sections 1174(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 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 other remedies provided in this Lease, Landlord shall be entitled, to the extent permitted by applicable Law, to injunctive 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 Perform Tenant's Obligations. 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 of ten percent (10%) per annum, or the highest rate permitted by applicable law.
18.7 Severability. 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.
CITA\51417\1017518.4 28
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.
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 yest 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 200% 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 Tenn 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 CITA\51417\1017518.4 29
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. l 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 twenty (20) days written request therefor from Landlord, execute a commercially reasonable subordination agreement in favor of the Mortgagee. Landlord shall use commercially reasonable efforts to 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 attom to any successor to Landlord's interest in this Lease.
22.2 Mortgage Protection. 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 shall have an additional reasonable period of time within which to cure such default, or if such default cannot be cured without Mortgagee 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) business 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 CITA\51417\1017518.4 30
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 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.l Equal Opportunity. 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 race, color, religion, sex or national origin. The employees of Tenant shall be treated during employment, without regard to their race, color, religion, sex, or national origin. 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 race, color, religion, sex, or national origin. ( 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.
CITA\51417\101751 8.4 31
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 Requirements. Tenant acknowledges and agrees any Alterations, including Capital Repairs, 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 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.
27.1 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 prop~r 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 froin 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 CITA\51417\1017518.4 32
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 oftime 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 of labor or materials, war, terrorist acts, 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 not place any sign upon the Premises without Landlord's prior written consent. All signage shall comply with Landlord's signage design criteria, as exist from time to time. In addition, any style, size, materials and attachment method of any such signage shall be subject to Landlord's prior written consent. The installation of any sign on the Premises by or for Tenant shall be subject to the provisions of this Lease. Tenant shall maintain any such signs installed on the Premises. Unless otherwise expressly agreed herein, Landlord reserves the right to installed, and all revenues from the installation of, such advertising signs on the Premises, including the roof, as do not unreasonably interfere with the conduct of Tenant's business.
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 Broker(s) 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, if any.
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 onCITA\51417\1017518.4 33 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 oncall 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 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 of Right 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 of injury 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 63 l(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 determined 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 Landlord or Tenant or by anyone acting through, under or on behalf of Landlord or Tenant. 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 Authority. 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 '11d warrant that (a) Tenant is duly incorporated or otherwise established or formed and validly ~a- under the laws of its state of incorporation, establishment or formation, (b) Tenant has .,1ialified to do business in California, ( c) Tenant has full corporate, partnership, trust, '
0 r power and authority to enter into this Lease and to perform all Tenant's 34 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 Quiet Possession. Landlord covenants and agrees with Tenant that, upon Tenant's payment of Rent and observing and performing all of the terms, covenants, conditions, provisions and agreements of this Lease on Tenant's part to be observed or performed, Tenant shall have the quiet possession of the Premises throughout the Term.
27.14 Asbestos Notification for Commercial Property Constructed Before 1979. Tenant acknowledges that Landlord has advised Tenant that, because of its age, the Building may contain asbestos-containing materials ("ACMs"). If Tenant undertakes any Alterations as may be permitted by Article 10, Tenant shall, in addition to complying with the requirements of Article 10, undertake the Alterations in a manner that avoids disturbing ACMs present in the Building. If ACMs are likely to be disturbed in the course of such work, Tenant shall encapsulate or remove the ACMs in accordance an approved asbestos-removal plan and otherwise in accordance with all applicable Environmental Laws, including giving all notices required by California Health & Safety Code Sections 25915-25919.7. 27 .15 Lead Warning Statement. Tenant acknowledges that Landlord has advised Tenant that buildings built before 1978 may contain lead-based paints ("LBP"). Lead from paint, paint chips and dust can pose health hazards if not managed properly. Subject to Article 10 of this Lease, Tenant may at its sole cost and expense, have a state certified LBP Inspector complete a LBP inspection and abatement and provide an abatement certification to Landlord.
Landlord has no specific knowledge of the presence of lead-based paint in the Premises.
27.16 OFAC Certification. 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 Department 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, warranty and covenant by Tenant shall be an immediate Default under the Lease.
27 .17 Certified Access Specialist Disclosure. In accordance with Civil Code Section 1938, Landlord hereby discloses that the Premises have not undergone inspection by a Certified 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 not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CITA\51417\1017518.4 35
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 parties 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 standards within the Premises shall be governed by Section 6.2 above.
27.18 Time of the Essence. Time is of the essence of this Lease and each and all of its provisions.
27 .19 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.
27.20 Rules and Regulations. Tenant shall faithfully observe and comply with the nondiscriminatory rules and regulations attached hereto as Exhibit F and incorporated herein by this reference, as the same may be modified from time to time by Landlord. Any additions or modifications to those rules shall be binding upon Tenant upon Landlord's delivery of a copy to Tenant. Notwithstanding anything to the contrary in this Lease, no modification to the rules and regulations whether pursuant to this or any other provision of this Lease, including Exhibit F, may materially increase the obligations imposed upon Tenant by this Lease, or materially limit the rights granted it thereby, or increase Tenant's financial obligations
27.21 Financial Statement. At Landlord's request, in connection with a proposed sale or financing involving the Premises, Tenant shall deliver to Landlord (a) a statement of net worth with respect to the fiscal year most recently ended and (b) such other type of financials and financial statements as Tenant then customarily gives or otherwise makes available to landlords of other spaces leased by Tenant in the United States. Such financial statements shall be prepared in accordance with Tenant's customary practices. Notwithstanding the foregoing, Tenant shall not be obligated to deliver such financial statements if Tenant is either (i) a publicly-traded corporation or (ii) the wholly-owned subsidiary of a publicly-traded corporation that does not maintain financial statements separate and apart from its publicly-traded "parent".
27.22 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. (collectively the "Relocation Assistance Laws"). Any Relocation of the Premises pursuant to Article 24 of this Lease shall be governed by the tenns of said article and not the Relocation Assistance Laws. 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 Tenant assert any claim for loss of business goodwill (as CITA\51417\1017518.4 36
that term is defined at CCP §1263.510) and no compensation for loss ofbusiness goodwill shall be paid by Landlord.
27.23 Alameda NAS Historic District. Tenant acknowledges that the Building is located within the NAS Alameda Historic District and has been designated as contributing to the Historic District. In granting, denying or conditioning its consent to any Alterations in accordance with Section 10.1 or the placement of any signs in accordance with Section 27.6, Landlord's decision will be guided by the terms and conditions of the City's Historic Preservation Ordinance and other planning and regulatory documents governing properties located within the NAS Alameda Historic District.
27.24 Subdivision and Development of Property. Tenant acknowledges that, without any form ofrepresentation or warranty, Landlord (or its successor) may cause the Property to be subdivided or existing parcels to be assembled to facilitate the sale, development or redevelopment of portions of Property which may or may not include those portions of the Property upon which the Building, Land and Parking Areas are located. Such subdivision may require the reservation of easements for utilities and access to adjacent properties or buildings.
As a material inducement for Landlord to enter into this Lease, Tenant agrees not to take any actions, oral or in writing, in opposition to such activities, or the planning thereof by Landlord (or its successor) unless such activity threatens to materially disrupt Tenant's rights under this Lease.
27.25 Environmental and Planning Documents. Tenant acknowledges that its use of the Premises and any Alterations thereto shall comply with the terms, conditions and requirements of: (a) the Environmental Impact Report for Alameda Point and the Mitigation Monitoring and Reporting Program adopted pursuant thereto; (b) the Master Infrastructure Plan; ( c) the Town Center and Waterfront Precise Plan (as applicable); and ( d) the Alameda Point Transportation Demand Management Plan. Compliance with the foregoing may include the preparation of a Compliance Strategy consistent with the Transportation Demand Management Plan. The provisions of Section 5 .1 ( c) above notwithstanding, Tenant shall not be required to pay any Transportation Demand Management fees or assessments.
27.26 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.
CITA\51417\1017518.4 37
Landlord and Tenant have executed this Lease as of the day and year first above written.
LANDLORD:
Approved as to Form ~
By:
City
~ Attorney
CITA\51417\1017518.4 38
TENANT:
Williams-Sonoma, Inc.,
a Delaware corporation, acting for and on
behalf of Williams-Sonoma Stores, Inc.
By:
Name: ~~~~~~~-='---~~~-
Tit I e:
Date· FOSTER F. COPE III
· Exeeuti~e Vice P1eside11t,
Chief Real Estate & Development Officer
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UNE OF MEZZANINE: ABOVE
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ALAMEDA REUSEJ>.Nb REDEVELOPEMENT AUTHORITY
BUILDING 169
FIRST FLOOR PLAN
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ALAMEDA REUSE AND
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MEZZANINE FLOOR
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CITA\5 1417\IOJ 7518.4
EXHIBIT A-1
PRIMARY PARKING AREA
CITA\51417\1017518.4
EXHIBIT A-2
OVERFLOW PARKING AREA
EXIDBIT A-3
ALTERNATIVE OVERFLOW PARKING AREA
CITA\51417\1017518.4
EXHIBITB
COMMENCEMENT LETTER
Re: Lease dated as of , 2017, by and between City of Alameda, as Landlord, and , a , as Tenant, for rentable --------~·
square feet in the Building __ located at , 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 Agreed and Accepted:
Landlord: City of Alameda Tenant:
By: By:
Name: Name:
Title: Title:
[Exhibit Do not sign]
CITA\51417\101 7518.4
EXHIBIT C
[INTENTIONALLY OMITTED]
EXIDBITD
ACKNOWLEDGMENT OF RECEIPT
Pursuant to that certain Leas_e Agreement entered into by and between City of Alameda, a charter city and municipal corporation ("Landlord") and Williams-Sonoma, Inc., a Delaware corporation, acting for and on behalf of Williams-Sonoma Stores, Inc. ("Tenant") dated as of January_, 2017 ("Lease") Tenant hereby acknowledges that Landlord has provided it with copies of the following documents:
e Quitclaim Deed from the United States of America, acting by and through the Department of the Navy to the City of Alameda, dated June 4, 2013, recorded June 6, 2013 as Series No. 2013-199818 of Official Records in the Office of the County Recorder, Alameda County, California ("Quitclaim Deed");
• Declaration of Restrictions (Former Naval Air Station Alameda) dated June 4, 2013, recorded June 6, 2013 as Series No. 2013-199782 in the Office of the County Recorder of Alameda County ("Declaration of Restrictions").
Pursuant to Section 6.3 of the Lease, Tenant acknowledges receipt of the above referenced documents and agrees that its use of the Premises (as defined in the Lease) shall comply with the restrictions set forth in said documents and failure to do so shall constitute a Default under the Lease.
Williams-Sonoma, Inc.,
a Delaware corporation, acting for and on behalf of
Williams-Sonoma Stores, Inc.
By:
Its:
Date:
CITA\51417\1017518.4
EXIITBIT E
ENVIRONMENT AL QUESTIONNAIRE
The purpose of this form is to obtain information regarding the use, if any, of hazardous substances in the process proposed on the premises to be leased. Any such use must be approved in writing by Landlord.
Prospective tenants should answer the questions in light of their proposed operations on the premises. Existing tenants should answer the questions as they relate to ongoing operations on the premises and should update any information previously submitted. If additional space is needed to answer the questions, you may attach separate sheets of paper to this form.
Your cooperation in this matter is appreciated. Any questions should be directed to, and when completed, the form should be mailed to:
PM Realty Group L.P.
Attn: Property Manager
101 West Atlantic A venue
Alameda, California 94501
(510) 749-0304; (510) 749-1095 fax
1. General Information.
Name of Responding Company: _____________________ _
Check the Applicable Status: ____________________ _
Prospective Tenant D Existing Tenant D
Mailing Address: __________________________ _
Contact Person and Title: _______________________ _
Telephone Number: L_) ______________________ _
Alameda Point Address of Proposed Premises to be Leased: ___________ _ Length of Lease Term: ________________________ _
Your Standard Industrial Classification (SIC) Code Number: ___________ _ Describe the proposed operations to take place on the property, including principal products manufactured, services and a brief process flow description to be conducted. Existing tenants should describe anyproposed changes to ongoing operations.
2. Use and/or Storage of Hazardous Materials.
CITA\51417\1017518.4
2.1 Will any hazardous materials be used or stored onsite? Hazardous Wastes
Hazardous Chemical Products
Yes D
Yes D
No D
No D
2.2 Attach the list of any hazardous materials/wastes to be used, stored, or generated the quantities that will be onsite at any given time, and the location and method of storage (e.g., 55-gallon drums on concrete pad).
2.3 Does your company handle hazardous materials in a quantity equal to or exceeding an aggregate of 500 pounds, 55 gallons, or 200 cubic feet? Yes D No D
If yes please provide Material Safety Data Sheets (MSDS) on such materials.
2.4 Has your business filed for a Consolidated Hazardous Materials Permit from the Alameda County Environmental Management Department?
Yes D No D
If so, attach a copy of the permit application.
2.5 Are any of the chemicals used in your operations regulated under Proposition 65? Yes D No D
If so, describe the actions taken, or proposed to be taken, to comply with Proposition 65 requirements. --------~-----------------~
2.6 Do you store or use or intend to store or use acutely hazardous materials above threshold quantities requiring you to prepare a risk management plan (RMP)? Yes D No D
2. 7 Describe the procedures followed to comply with OSHA Hazard Communication Standard requirements. ------------------------
3. Storage Tanks and Pumps.
3.1 Are any above or below ground storage of gasoline, diesel, or other hazardous substances in tanks or pumps being used as a part of your present process or proposed for use on this leased premises?
Yes D No D
If yes, describe the materials to be stored, and the type, size and construction of the pump or tank. Attach copies of any permits obtained for the storage of such substances. -------------------------~
3.2 If you have an above ground storage tank (AST), do you have a spill prevention containment and countermeasures (SPCC) plan?
Yes D No D Not Applicable D
3 .3 Have any tanks, pumps or piping at you existing facilities been inspected or tested for leakage?
Yes D No D NotApplicable D
If so, attach the results.
3 .4 Have any spills or leaks occurred from such tanks, pumps or piping? Yes D No D NotApplicable D
If so, describe. ----------------------
3 .5 Were any regulatory agencies notified of any spills or leaks? Yes 0No D NotApplicable D
If so, attach copies of any spill reports filed, any clearance letters or other correspondence from regulatory agencies relating to the spill or leak. 3 .6 Have any underground storage tanks, sumps or piping been taken out of service or removed at the proposed facility or facilities that you operate?
4. Spills.
Yes D No D NotApplicable D
If yes, attach copies of any closure permits and clearance obtained from regulatory agencies relating to closure and removal of such tanks.
4.1 During the past year, have any spills occurred on any site you occupy? Yes D No D Not Applicable D
If so, please describe the spill and attach the results of any process conducted to determine the extent of such spills.
4.2 Were any agencies notified in connection with such spills? Yes D No D Not Applicable D
If no, attach copies of any spill reports or other correspondence with regulatory agencies.
4.3 Were any clean-up actions undertaken in connection with the spills? Yes D No D Not Applicable D
If so, briefly describe the actions taken. Attach copies of any clearance letters obtained from any regulatory agencies involved and the results of any final soil or groundwater sampling done upon completion of the clean-up work ______ _
5. Waste Management.
5. I Has your business filed a Hazardous Material Plan with the Alameda County Environmental Management Department?
Yes D No D
5.2 Has your company been issued an EPA Hazardous Waste Generator I.D. Number? Yes D No D
If yes: EPA ID# ____ _
5.3 Has your company filed a biennial report as a hazardous waste generator? Yes D No D
If so, attach a copy of the most recent report filed.
5 .4 Are hazardous wastes stored in secondary containments? Yes D No D
5.5 Do you utilize subcontractors for lighting/electrical, plumbing, HV AC, pest services, landscaping and/or building maintenance services?
Yes D No D
If yes, do any of these subcontractors store, mix or utilize chemicals on site? Yes D No D
If yes, what types and quantities? __________________ _ Attach the list of the hazardous waste, if any, generated or to be generated at the premises, its hazard class and the quantity generated on a monthly basis.
Describe the method(s) of disposal for each waste. fudicate where and how often disposal will take place. ----------------------
fudicate the name of the person(s) responsible for maintaining copies of hazardous waste manifests completed for off site shipments of hazardous waste. ------,...-- Is any treatment, processing and recycling of hazardous wastes currently conducted or proposed to be conducted at the premises:
Yes D No D
If yes, please describe any existing or proposed treatment, processing or recycling methods. ~-------------------------~
Attach copies of any hazardous waste permits or licenses issued to your company with respect to its operations on the premises.
6. Wastewater Treatment/Discharge.
6.1 Will your proposed operation require the discharge of wastewater to (answer Yes or No to each of the following)?
storm drain
surface water
___ sewer
___ no industrial discharge
6.2 Does your business have a Sewer Use Questionnaire on file with Alameda County Sanitation District?
Yes D No D
6.3 Is your wastewater treated before discharge?
Yes D No D Not Applicable D
If yes, describe the type of treatment conducted.
6.4 Does your business conduct operations outside the building or store materials outside? Yes D No D NotApplicable D
6.5 Do you have a Storm Water Pollution Prevention Plan (SWPPP)? Yes D No D NotApplicable D
6.6 Does your business have a General Permit for storm water discharge associated with industrial activity?
Yes D No D Not Applicable D
6.7 Does your business operate under a National Pollution Discharge Elimination System (NPDES) Permit?
Yes D No D NotApplicable D
Attach copies of any wastewater discharge permits issued to your company with respect to its operations on the premises.
7. Air Discharges. 1
7 .1 Do you have or intend to have any air filtration systems or stacks that discharge into the air?
Yes D No D
7.2 Do you operate or plan to operate any of the following types of equipment, or any other equipment requiring an air emissions permit (answer Yes or No to each of the following)?
Spray booth
Dip tank
Drying oven
IneineratorDip tank
Drying oven
Incinerator
Other (please describe)
Boiler
IIC Engine
Emergency Backup Generator
Processes that apply coatings, inks,
adhesives or use solvents
7.3 Do you emit or plan to emit any toxic air contaminates? Yes D No D
7.4 Are air emissions from your operations monitored?
Yes D NoD
Yes 0No D ¥es-0~I&-0
¥es--0Ne--0
Yes 0No D
Yes 0No D
Yes 0No D
Yes 0No D
Yes 0No D
Yes 0No D
Yes 0No D
Yes 0No D
If so, indicate the frequency of monitoring and a description of the monitoring results. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Attach copies of any air emissions permits pertaining to your operations on the premises.
8. Enforcement Actions, Complaints.
8.1 Has your company, within the past five years, ever been subject to any agency enforcement actions, administrative orders, or consent decrees? Yes D No D
1 NOTE: Businesses will have to comply with prohibitory rules regardless of whether they have or need a permit.
If so, describe the actions and any continuing compliance obligations imposed as a result of these actions. -----------------------
8.2 Has your company ever received requests for information, notice or demand letters, or any other inquiries regarding its operations?
Yes D No D
8.3 Have there ever been, or are there now pending, any lawsuits against the company regarding any environmental or health and safety concerns? Yes D No D
8.4 Has any environmental audit ever been conducted at your company's current facility? Yes D No D
If so, discuss the results of the audit. ________________ _
8.5 Have there been any problems or complaints from neighbors at the company's current facility?
Yes D No D
Please describe: ________________________ _
The undersigned hereby certifies that all of the information contained in this questionnaire is accurate and correct.
a -------------------
By: _____________ _
Title: _______________ _
Date: -----------------
EXIDBITF
RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the following Rules and Regulations. Landlord shall not be responsible to Tenant for the non-performance of any of said Rules and Regulations by or otherwise with respect to the acts or omissions of any other tenants or occupants of the Building. In the event of any conflicts between the Rules and Regulations and other provisions of this Lease, the latter shall control.
1. Landlord shall have the right to control and operate the public portions of the Building and the public facilities, as well as facilities furnished for the common use of the tenants, in such manner as it deems best for the benefit of the tenants generally.
2. No advertisements, pictures or signs of any sort shall be displayed on or outside the Premises or Building without the prior written consent of Landlord. This prohibition shall include any portable signs or vehicles placed within the parking lot, common areas or on streets adjacent thereto for the purpose of advertising or display. Landlord shall have the right to remove any such unapproved item without notice and at Tenant's expense.
3. Storage of forklift propane tanks, whether interior or exterior, shall be in secured and protected storage and enclosure approved by the local fire department and, if exterior, shall be located in areas specifically designated by Landlord. Tenant shall protect electrical panels and building mechanical equipment from damage from forklift trucks.
4. Machinery, equipment and apparatus belonging to Tenant which causes noise or vibration that may be transmitted to the structure of the Building to such a degree as to be objectionable to Landlord or other tenants or to cause harm to the Building, shall be placed and maintained by Tenant, at Tenant's expense, on vibration eliminators or other devices sufficient to eliminate the transmission of such noise and vibration. Tenant shall cease using any such machinery which causes objectionable noise and vibration which cannot be sufficiently mitigated.
5. All goods, including materials used to store goods, delivered to the Premises shall be immediately moved into the Premises and shall not be left in parking or exterior loading areas overnight.
6. Tractor trailers which must be unhooked or parked with dolly wheels beyond the concrete loading areas must uses steel plates or wood blocks of sufficient size to prevent damage to the· asphalt paving surfaces. No parking or storage of such trailers will be permitted in the auto parking areas adjacent to the Premises or on streets adjacent thereto.
7. Tenant is responsible for the safe storage and removal of all pallets.
Pallets shall be stored behind screen enclosures at locations approved by Landlord.
8. Tenant shall not store or permit the storage or placement of merchandise in or around the common areas surrounding the Premises. No displays or sales of merchandise shall be allowed in the parking lots or other common areas.
CITA\51417\1017518.4
9. Tenant is responsible for the storage and removal of all trash and refuse.
All such trash and refuse shall be contained in suitable receptacles stored behind screen enclosures at locations approved by Landlord.
10. The toilet rooms, urinals, wash bowls and other apparatus shall not be used for any purpose other than that for which they were constructed and no foreign substances of any kind whatsoever shall be thrown therein. The expense of the repair of any breakage, stoppage or damage resulting from the violation of this rule shall be borne by the tenant who, or whose employees, agents, visitors or licensees shall have caused the same.
11. Tenant shall cooperate fully with Landlord to ensure the effective operation of the Building's air conditioning systems. If Tenant shall so use the Premises that noxious or objectionable fumes, vapors and/or odors are created, then Tenant shall provide proper ventilation equipment for the discharge of such fumes, vapors and odors so that they shall not enter into the air conditioning system or be discharged into other vents or flues of the building or annoy any of the other tenants of the Building or adjacent property. The design, location and installation of such equipment shall be subject to the Landlord's approval.
12. All window coverings installed by Tenant and visible from the outside of the Building require the prior written approval of Landlord.
13. The sashes, sash doors, skylights, windows and doors that reflect or admit light or air into the halls, passageways or other public places in the Building shall not be covered or obstructed by Tenant.
14. Tenant shall not overload the floor of the Premises.
15. No aWnings or other projections over or around the windows or entrances of the Premises shall be installed by arty tenant without the prior written consent of Landlord.
16. Tenant shall not permit any animals, including, but not limited to, household pets (but excluding service animals, which are permitted), to be brought or kept in or about the Premises or Building or any of the common areas.
17. Tenant hereby acknowledges that Landlord shall have no obligation to provide guard service or other security measures for the benefit of the Premises or Building.
Tenant hereby assumes all responsibility for the protection of Tenant and its agents, employees, contractors, invitees and guests, and the property thereof, from acts of third parties, including keeping doors locked and other means of entry to the Premises closed.
18. No auction, liquidation, fire sale, going out of business or bankruptcy sale shall be conducted in or about the Premises without the prior written consent of Landlord.
19. No tenant shall use or permit the use of any portion of the Premises for living quarters, sleeping apartments or lodging rooms.
20. Tenant, Tenant's agents, employees, contractors, licensees, or visitors shall not park any vehicles in driveways, service entrances, or areas posted as no parking.
21. If the Premises are or become infested with vermin as a result of the use or any misuse or neglect of the Premises by Tenant, its agents, employees, contractors, visitors or licensees, Tenant shall forthwith, at Tenant's expenses, cause the same to be exterminated from time to time to the satisfaction of Landlord and shall employ such licensed exterminators as shall be approved in writing in advance by Landlord.
22. Tenant shall not use the name of the Building for any purpose other than as the address of the business to be conducted by Tenant in the Premises, nor shall Tenant use any picture of the Building in its advertising, stationary or in any other manner without the prior written permission of Landlord. Landlord expressly reserves the right at any time to change said name without in any manner being liable to Tenant therefor.
23. Tenant, its employees and agents shall not loiter in or on the entrances, corridors, sidewalks, lobbies, courts, halls, stairways, elevators, vestibules or any common areas of the building for the purpose of smoking tobacco products or for any other purposes, nor in any way obstruct such areas, and shall use them only as a mean of ingress and egress from the Premises.
24. Landlord reserves the right to exclude from the Building or the Common Areas any person who, in the judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or who shall in any manner do any act in violation of these Rules and Regulations.
25. Landlord reserves the right at any time to change or rescind any one or more of these Rules and Regulations, or to make such other and further reasonable Rules and Regulations as in Landlord's judgment may from time to time be necessary for the management, safety, care and cleanliness of the Premises, common areas of the Building and Building, and for the preservation of good order therein, as well as for the convenience of other occupants and tenants thereof. Landlord may waive any one or more of these Rules and Regulations for the benefit of any particular tenant, but no such waiver by Landlord shall be construed as a waiver of such Rules and Regulations in favor of any other tenant, nor prevent Landlord from thereafter enforcing any such Rules and Regulations against any or all tenants of the Building. Tenant shall be deemed to have read these Rules and Regulations and to have agreed to abide by them as a condition to its occupancy of the Premises.
EXHIBIT G
TENANT WORK LETTER
This Exhibit is attached to and made a part of the Lease Agreement (the "Lease") by and by and between CITY OF ALAMEDA, a charter city and municipal corporation ("Landlord") and WILLIAMS-SONOMA, INC., a Delaware corporation, acting for an on behalf of Williams-Sonoma Stores, Inc. ("Tenant") for those premises consisting of approximately 43,355 rentable square feet in Building 169, located at 1680 Viking St., Alameda, CA (the "Premises").
1. CAPITAL REPAIRS
1.1 Capital Repair Credit. Tenant shall be entitled to a one-time Capital Repair Credit (the "CRC") up to a maximum of Thirty Thousand and 00/100 Dollars ($30,000.00) ("Capital Repair Credit Amount") for the costs incurred by Tenant to repair or replace operating systems, fire life safety compliance and potential remediation work, including, without limitation, all soft and hard costs applicable to the design (including consultant and project management fees), and permitting costs ("Capital Repair Credit Items") to the Premises but excluding tenant improvements, furniture, fixtures, equipment, cabling or moving expenses (the "Capital Repairs"). Tenant shall complete construction of the Capital Repairs within the first twelve (12) months of the Term (the "CRC Completion Period"). Said CRC shall be in the form of offsets of Tenant's Base Rent obligations as set forth hereinbelow. In no event shall Landlord be obligated to grant Tenant an offset to its Base Rent obligations pursuant to this Work Letter in a total amount which exceeds the total Capital Repair Credit Amount. Tenant shall have no claim to any CRC, and Landlord shall have no obligation to grant Tenant an offset to its Base Rent obligations for any Capital Repairs that have not been documented in accordance with Section l.2(a)(i) within the CRC Completion Period. It is understood and agreed that any Capital Repairs must comply with all of the terms and provisions of this Lease, including, but not limited to, Sections 6.2, 6.3, 27.14, 27.15, 27.23, 27.24 & 27.26.(b)
1.2 Monthly Capital Repair Credit.
(a) Monthly Base Rent Credits. Commencing on the first full month of the Term, Tenant shall receive a credit in an amount not to exceed $2,500 per month against Base Rent that would otherwise be due during the first twelve (12) months of the Term (the "Monthly Base Rent Credit").
(i) Documentation of Capital Repair Credit Items. From time to time after the Commencement Date but starting no later than the last day of the third month of the Term, Tenant shall deliver to Landlord invoices (either due or paid) from all of "Tenant's Agents," as that term is defined in Section 3.l(b) of this Tenant Work Letter, for labor rendered and materials delivered to the Premises for the applicable Documentation Period and (C) any other information reasonably requested in good faith by Landlord. (ii) Cumulative Credit. Upon satisfactory documentation of Capital Repair Credit Items in accordance with l.2(a)(i) above, Tenant shall receive Monthly Base Rent Credits until the amount of documented Capital Repair Credit Items has been fully credited.
CITA\51417\1017518.4
Tenant may submit documentation for additional Capital Repair Credit Items before exhausting its Monthly Base Rent Credits from previously documented items. If at any time Tenant has exhausted all of its Monthly Base Rent Credits for Capital Repair Credit Items documented in accordance with 1.2(a)(i) above, then Tenant shall immediately commence payment of Base Rent in accordance with the terms of this Lease and shall continue making such payments until such time as Tenant submits further documentation of Capital Repair Items, in a total amount not in excess of the total Capital Repair Credit Amount.
2. CONSTRUCTION DRAWINGS
2.1 Construction Drawings. Tenant shall cause to be prepared all plans and engineering working drawings relating to the structural, mechanical, electrical, plumbing, HV AC, life safety, and sprinkler work necessary for the Capital Repairs in accordance with the Approved Scope (collectively the "Construction Drawings").
2.2 Approval of Construction Drawings. Upon Landlord's request, the Construction Drawings for the Capital Repairs shall be submitted to Landlord or its agent for Landlord's review. Landlord's review and approval of the Approved Scope and Construction Drawings shall be in its proprietary capacity as Landlord under this Lease and no such approvals shall be deemed an approval by the City of Alameda in its regulatory capacity. If Landlord requests to review and approve the Construction Drawings it shall, within ten (10) business days after Landlord's receipt of the Construction Drawings, either (i) approve the Construction Drawings, (ii) approve the Construction Drawings subject to specified conditions which must be stated in a reasonably clear and complete manner to be satisfied by Tenant prior to submitting the Approved Construction Drawings for permits as set forth in Section 2.3 below of this Tenant Work Letter, or (iii) disapprove and return the Construction Drawings to Tenant with reasonably clear and complete requested revisions. If Landlord fails to timely notify Tenant of Landlord's approval or disapproval of any such Construction Drawings, Tenant shall have the right to provide Landlord with a second written request for approval (a "Second Request") that specifically identifies the applicable Construction Drawings and contains the following statement in bold and capital letters: "THIS IS A SECOND REQUEST FOR APPROVAL OF CONSTRUCTION DRAWINGS PURSUANT TO THE PROVISIONS OF SECTION 2.2 OF THE WORK LETTER. IF LANDLORD FAILS TO RESPOND WITHIN FIVE (5) BUSINESS DAYS
AFTER RECEIPT OF TIDS NOTICE, THEN LANDLORD SHALL BE DEEMED TO HA VE APPROVED THE CONSTRUCTION DRAWINGS DESCRIBED HEREIN." If Landlord fails to respond to such Second Request within five ( 5) business days after receipt by Landlord, the Construction Drawings in question shall be deemed approved by Landlord acting in its proprietary capacity as Landlord. Upon Landlord's disapproval of any Construction Drawings, Tenant may revise and resubmit the same to Landlord; in such event the scope of Landlord's review of such Construction Drawings shall be limited to Tenant's correction of the items to which Landlord had previously objected. Such procedure shall be repeated until the Construction Drawings are approved.
2.3 Permits. Tenant shall cause to be obtained all applicable building permits required in connection with the construction of the Capital Repairs ("Permits"). Tenant hereby agrees that neither Landlord nor Landlord's consultants shall be responsible for obtaining any Permits for the Capital Repairs and that any approval by Landlord of the Construction Drawings shall be solely in its proprietary capacity as Landlord and shall not relieve Tenant of its obligation to obtain such Permits from the City of Alameda, in its regulatory capacity.
3. CONSTRUCTION OF THE CAPITAL REPAIRS
3.1 Tenant's Agents.
(a) The Contractor. For purposes of this Tenant Work Letter, Pro-Forma Construction is the approved general contractor ("Contractor"). (b) Tenant's Agents. The Contractor and the Contractor's subcontractors (collectively, "Tenant's Contractors") and their respective workers shall conduct their activities in and around the Premises, the Building and the Property in a harmonious relationship with all other subcontractors, laborers, materialmen and supplies at the Premises and Building (such major trade subcontractors and material suppliers along with all other laborers, materialmen, and suppliers, and the Contractor to be known collectively as "Tenant's Agents").
3.2 Construction of Capital Repairs by Tenant's Agents. (a) Tenant's Agents.
(i) Landlord's General Conditions. Tenant's and Tenant's Agents' for construction of the Capital Repairs shall comply with the following: (A) the Capital Repairs shall be constructed in material conformance with the Approved Construction Drawings; (B) Tenant shall abide by all construction guidelines and reasonable rules (if any) made by Landlord's property manager with respect to any matter, within reason, in connection with this Tenant Work Letter, including, without limitation, the construction of the Capital Repairs; (C) for any work subject to Prevailing Wage Laws, no Contractor or subcontractor may be listed on a bid proposal for a public works project unless registered with the Department of Industrial Relations pursuant to Labor Code Section 1725.5 (with the limited exceptions from this requirement for bid purposed only under Labor Code Section 1771.l(a)). Register at https://efiling.dir.ca.gov/PWCR; (D) no Contractor or subcontractor may be awarded a contract for public work on a public works project unless registered with the Department of Industrial Relations pursuant to Labor Code Section 17.25.5; (E) and the Contractor must post job site notices prescribed by regulations. See 8 Calif. Code Regulation § 16451 ( d). (ii) Indemnity. Tenant's indemnity of Landlord as set forth, in this Lease, shall also apply with respect to any and all costs, losses, damages, injuries and liabilities related in any way to any act or omission of Tenant or Tenant's Agents, or anyone directly or indirectly employed by any of them, or in connection with Tenant's non-payment of any amount arising out of the Capital Repairs.
(iii) Requirements of Tenant's Agents. Tenant's Contractor shall guarantee to Tenant and for the benefit of Landlord that the portion of the Capital Repairs for which such contractor is responsible shall be free from any defects in workmanship and materials for a period of not less than one (1) year from the date of completion thereof. Tenant's Contractor shall be responsible for the replacement or repair, without additional charge, of all work done or furnished in accordance with its contract that shall become defective within one (1) year after completion. All such warranties or guarantees as to materials or workmanship of or with respect to the Capital Repairs shall be contained in the contract or subcontract and shall be written such that such guarantees or warranties shall inure to the benefit of both Landlord and Tenant, as their respective interests may appear, and can be directly enforced by either. Tenant covenants to give to Landlord any assignment or other assurances which may be necessary to effect such right of direct enforcement.
(iv) Insurance Requirements.
A. General Coverages. All ofTenant's Agents shall carry worker's compensation insurance covering all of their respective employees, and shall also carry commercial general liability insurance, including property damage, all with limits, in form and with companies as are required to be carried by Tenant as set forth in this Lease (provided that the limits of liability to be carried by Tenant's Agents and Contractor, shall be in an amount which is customary for such respective Tenant's Agents employed by tenants constructing improvements in the Comparable Buildings), and the policies therefor shall insure Landlord and Tenant, as their interests may appear, as well as the Contractor and subcontractors.
B. Contractor's Pollution Legal Liability. Tenant shall cause Tenant's Agent's to obtain and maintain Contractor's Pollution Liability Insurance covering the general contractor and all subcontractors in an amount of not less than Two Million Dollars ($2,000,000) with a maximwn deductible of One Hundred Thousand Dollars ($100,000) with coverage continuing for ten years after completion of construction. Any such policy shall name the City as an additional insured.
C. Special Coverages. Contractor shall carry "Builder's All Risk" insurance, in an amount approved by Landlord but not more than the amount of the construction contract, covering the construction of the Capital Repairs and, if applicable, the Tenant Improvements and such other insurance as Landlord may reasonably require.
D. General Terms. Certificates for all insurance carried pursuant to this Section shall be delivered to Landlord before the commencement of construction of the Capital Repairs and, if applicable, the Tenant Improvements and before the Contractor's equipment is moved onto the Property. All such policies of insurance must contain a provision that the company writing said policy will give Landlord thirty (30) days' prior notice of any cancellation or lapse of the effective date or any reduction in the amounts of such insurance. In the event that the Capital Repairs are damaged by any cause during the course of the construction thereof and this Lease is not terminated, Tenant shall immediately repair the same at Tenant's sole cost and expense. Tenant's Agents shall maintain all of the foregoing insurance coverage in force until the completion of the Capital Repairs and, if applicable, the Tenant Improvements.
All such insurance relating to property, except Workers' Compensation, maintained by Tenant's Agents shall preclude subrogation claims by the insurer against anyone insured thereunder. Such insurance shall provide that it is primary insurance as respects the owner and that any other insurance maintained by Landlord is excess and noncontributing with the insurance required hereunder.
year after completion. All such warranties or guarantees as to materials or workmanship of or with respect to the Capital Repairs shall be contained in the contract or subcontract and shall be written such that such guarantees or warranties shall inure to the benefit of both Landlord and Tenant, as their respective interests may appear, and can be directly enforced by either. Tenant covenants to give to Landlord any assignment or other assurances which may be necessary to effect such right of direct enforcement.
(iv) Insurance Requirements.
A. General Coverages. All of Tenant's Agents shall carry worker's compensation insurance covering all of their respective employees, and shall also carry commercial general liability insurance, including property damage, all with limits, in form and with companies as are required to be carried by Tenant as set forth in this Lease (provided that the limits of liability to be carried by Tenant's Agents and Contractor, shall be in an amount which is customary for such respective Tenant's Agents employed by tenants constructing improvements in the Comparable Buildings), and the policies therefor shall insure Landlord and Tenant, as their interests may appear, as well as the Contractor and subcontractors.
TIAlv ~
B. Contractor's Pollution Legal Liability. 'Letiant shall cause~ Tenant's Agent's to obtain and maintain Contractor's Pollution Liability In~ui'.'ance covering the general contractor and all subcontractors in an amount of not less than ~Million Dollars ($ 000,000twith a-Hlaximtitti dedHstiBle of One Hmrdred Thou:sa:ntl BeUftfs ($100,000) iivith ooverage conti.tluing for teu years aft~-ieH-ef--eettstrttetfon. Any sach policy shall name t-hs City as an~al insur-e<±-
C. Special Coverages. Contractor shall carry "Builder's All Risk" insurance, in an amount approved by Landlord but not more than the amount of the construction contract, covering the construction of the Capital Repairs and, if applicable, the Tenant Improvements and such other insurance as Landlord may reasonably require.
D. General Terms. Certificates for all insurance carried pursuant to this Section shall be delivered to Landlord before the commencement of construction of the Capital Repairs and, if applicable, the Tenant Improvements and before the Contractor's equipment is moved onto the Property. All such policies of insurance must contain a provision that the company writing said policy will give Landlord thirty (30) days' prior notice of any cancellation or lapse of the effective date or any reduction in the amounts of such insurance. In the event that the Capital Repairs are damaged by any cause during the course of the construction thereof and this Lease is not terminated, Tenant shall immediately repair the same at Tenant's sole cost and expense. Tenant's Agents shall maintain all of the foregoing insurance coverage in force until the completion of the Capital Repairs and, ;f applicable, the Tenant Improvements.
All such insurance relating to property, except Workers' Compensation, maintained by Tenant's Agents shall preclude subrogation claims by the insurer against anyone insured thereunder. Such insurance shall provide that it is primary insurance as respects the owner and that any other insurance maintained by Landlord is excess and noncontributing with the insurance required hereunder.
(b) Governmental Compliance. The Capital Repairs shall comply in all respects with the following: (i) all Laws; (ii) applicable standards of the American Insurance Association (formerly, the National Board of Fire Underwriters) and the National Electrical Code; and (iii) the applicable standards of the International Building Code (2003); (iv) building material manufacturer's specifications (collectively, the "Code"). ( c) Inspection by Landlord. Landlord shall have the right to inspect the Capital Repairs at all reasonable times; provided, however, that Landlord's failure to inspect the Capital Repairs shall in no event constitute a waiver of any of Landlord's rights hereunder nor shall Landlord's inspection of the Capital Repairs constitute Landlord's approval of the same. In the event that Landlord should reasonably disapprove any portion of the Capital Repairs or, if applicable, the Tenant Improvements for failure to comply with the Approved Construction Drawings, during an inspection, Landlord shall notify Tenant in writing within a reasonable time of such inspection of such disapproval and shall specify in reasonably clear and complete detail the items disapproved and grounds for disapproval. Any defects or deviations in, and/or disapprovals in accordance herewith by Landlord shall be rectified by Tenant at Tenant's expense and at no additional expense to Landlord.
3.3 Notice of Completion; Copy of Record Set of Plans. If requested by Landlord after completion of construction of the Capital Repairs, Tenant shall, within ten (10) days after receipt of any such request, prepare a Notice of Completion, which Landlord shall execute if factually correct, and Tenant shall cause such Notice of Completion to be recorded in the office of the Recorder of the County of Alameda in accordance with Section 8060 of the Civil Code of the State of California or any successor statute, and shall furnish a copy thereof to Landlord upon such recordation. If Tenant fails to do so, Landlord may execute and file the same on behalf of Tenant as Tenant's agent for such purpose, at Tenant's sole cost and expense. At the conclusion of construction, Tenant shall deliver to Landlord a complete set final Construction Drawings and copies of all warranties, guaranties, and operating manuals and information relating to the improvements, equipment, and systems in the Premises.
4. MISCELLANEOUS
4.1 Tenant's Representative. Tenant has designated Gene Myers as its sole representative with respect to the matters set forth in this Tenant Work Letter, who shall have full authority and responsibility to act on behalf of the Tenant as required in this Tenant Work Letter. Tenant may change Tenant's representative at any time and from time to time upon at least two (2) business days' notice to Landlord.
4.2 Landlord's Representative. Landlord has designated Nanette Mocanu, Acting Assistant Community Development Director as its sole representative with respect to the matters set forth in this Tenant Work Letter, who, until further notice to Tenant, shall have full authority and responsibility to act on behalf of the Landlord as required in this Tenant Work Letter.
4.3 Time of the Essence in This Tenant Work Letter. Unless otherwise indicated, all references herein to a "number of days" shall mean and refer to calendar days. If any item requiring approval is timely disapproved by Landlord, the procedure for preparation of the document and approval thereof shall be repeated until the document is approved by Landlord.
4.4 Tenant's Lease Default. Notwithstanding any terms to the contrary contained in this Lease, if Tenant is in Default of this Lease (including, without limitation, this Tenant Work Letter) at any time on or before the completion of the Capital Repairs, then (i) in addition to all other rights and remedies granted to Landlord pursuant to the Lease, Landlord shall have the right to withhold all or any portion of the Capital Repair Credit and demand immediate payment of Base Rent with no further Monthly Base Rent Credits until said Default is cured by Tenant pursuant to the terms of the Lease, and (ii) all other obligations of Landlord under the terms of this Tenant Work Letter shall be suspended until such time as such Default is cured by Tenant pursuant to the terms of the Lease (in which case, Tenant shall be responsible for any delay in the completion of the Capital Repairs caused by such inaction by Landlord).
4.5 Extension of Deadlines. Any deadlines imposed on Tenant in this Tenant Work Letter shall be extended by Force Majeure (as defined in Section 27.4 of this Lease).