Clovis City Council
June 15, 2026

June 15, 2026 - 1 - 6:00 PM

Agenda • City Council Meeting

Council Chamber, 1033 Fifth Street, Clovis, CA 93612 (559) 324-2060 www.clovisca.gov

June 15, 2026 6:00 PM Council Chamber
In compliance with the Americans with Disabilities Act, if you need special assistance to access the City Council Chamber to participate at this meeting, please contact the City Clerk at (559) 324-2060 (TTY – 711). Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to the Council Chamber.

The Clovis City Council meetings are open to the public at the physical address listed above. There are numerous ways to participate in the City Council meetings: you are able to attend in person; you may submit written comments as described below; and you may view the meeting which is webcast and accessed at www.clovisca.gov/agendas.

Written Comments
• Members of the Public are encouraged to submit written comments at:
www.clovisca.gov/agendas at least two (2) hours before the meeting (4:00 PM). You will be prompted to provide Council Meeting Date, Item Number, Name, Email, Comment • Please submit a form for each item you are commenting on. • A copy of your written comment will be provided to the City Council noting the item number.

If you wish to make a verbal comment, please see instructions below. • Please be aware that any written comments received that do not specify a particular agenda item will be marked for the general public comment portion of the agenda. • If a written comment is received after 4:00 PM on the day of the meeting, efforts will be made to provide the comment to the City Council during the meeting. However, staff cannot guarantee that written comments received after 4:00 PM will be provided to City Council during the meeting. All written comments received prior to the end of the meeting will be made part of the record of proceedings.

Campaign Contribution Prohibition and Mandatory Disclosure – Pursuant to Government Code section 84308, a Councilmember shall not accept, solicit, or direct a campaign contribution of more than $500 from any party or their agent, or from any participant or their agent, while a proceeding involving a license, permit, contract, or other entitlement for use is pending before the City or for 12 months after a final decision is rendered in that proceeding. Any Councilmember who has received a campaign contribution of more than $500 within the preceding 12 months from a party or their agent, or from a participant or their agent, must disclose that fact on the record of the proceeding and shall not make, participate in making, or in any way attempt to use their official position to influence the decision.

June 15, 2026 - 2 - 6:00 PM
Pursuant to Government Code section 84308, subdivision (e), any party to a covered proceeding before the City Council is required to disclose on the record of the proceeding any campaign contribution, including aggregated contributions, of more than $500 made within the preceding 12 months by the party or their agent to any Councilmember. The disclosure shall be made as required by Government Code Section 84308, subdivision (e)(1) and California Code of Regulations, Title 2, section 18438.8. No party or their agent, and no participant or their agent, shall make a campaign contribution of more than $500 to any Councilmember during the covered proceeding or for 12 months after a final decision is made in that proceeding. The foregoing statements do not constitute legal advice, and parties and participants are urged to consult with their own legal counsel regarding the applicable requirements of the law.

Call to Order
Flag Salute - Mayor Pro Tem Pearce
Roll Call
Presentations/Proclamations

1. Presentation of Proclamation Honoring Fresno County Pink Heals.

Public Comments
This is an opportunity for the members of the public to address the City Council on any matter within the City Council’s jurisdiction that is not listed on the Agenda. In order for everyone to be heard, please limit your comments to 3 minutes or less, or 10 minutes per topic. Anyone wishing to be placed on the Agenda for a specific topic should contact the City Manager’s office and submit correspondence at least 10 days before the desired date of appearance.

Consent Calendar
Items considered routine in nature are to be placed upon the Consent Calendar. They will all be considered and voted upon in one vote as one item unless a Councilmember requests individual consideration. A Councilmember’s vote in favor of the Consent Calendar is considered and recorded as a separate affirmative vote in favor of each action listed. Motions in favor of adoption of the Consent Calendar are deemed to include a motion to waive the reading of any ordinance or resolution on the Consent Calendar. For adoption of ordinances, only those that have received a unanimous vote upon introduction are considered Consent items.

2. Administration - Approval - Minutes from the June 8, 2026, City Council Meeting.

3. Administration – Adopt – Ord. 26-04, An Ordinance of the City Council of the City of Clovis, Amending Chapter 6.4 of the Clovis Municipal Code Pertaining to Administration of Sewage Disposal Provisions; and Amending Chapter 6.5 of the Clovis Municipal Code Pertaining to Water Service Rates and Regulations. (Vote: 5-0)

4. Administration - Approval - Res. 26-___, a Resolution Approving a Schedule of Water Rate Increases and Adjustments Effective January 1, 2027, and an Annual Schedule of Adjustments for Future Water Rate Increases Each July 1st Beginning July 1, 2029.

5. General Services - Approval of the Clovis Transit Public Transportation Agency Safety Plan (PTASP).

6. General Services - Approval - Res. 26-____, Approving a Side Letter Agreement with the Clovis Public Safety Employees Association (CPSEA) to Establish a Modified Salary Structure Methodology.

June 15, 2026 - 3 - 6:00 PM

7. Police - Approval - Amendment to the Police Department Military Equipment List Pursuant to Policy 706.

8. Police - Approval - Authorize the City Manager to enter into an agreement with Clovis Industrial Park, Inc., for the lease of 272 N. Minnewawa Ave., for approximately $138,000 per year.

9. Public Utilities – Approval – Award Non-Exclusive Franchise Agreements for Hauling of Construction and Demolition Debris, and Update the City’s Approved Hauler List.

10. Public Utilities – Approval – Bid Award for PUD 24-03, 2026 Landfill Gas Collection and Control System Improvements at the Clovis Landfill, to BSE General Engineering, Inc., in the Amount of $392,228.00; and Authorize the City Manager to Execute the Contract on Behalf of the City.

Administrative Items
Administrative Items are matters on the regular City Council Agenda other than Public Hearings.

11. Consider Approval - Confirmation of City Manager's Appointment of Fire Chief.

Staff: Andrew Haussler, City Manager
Recommendation: Approve
Public Hearings
A public hearing is an open consideration within a regular or special meeting of the City Council, for which special notice has been given and may be required. When a public hearing is continued, noticing of the adjourned item is required as per Government Code 54955.1.

12. Consider Various Actions - Approval – Res. 26-___, Approving various actions required to conduct the November 3, 2026, General Municipal Election:

a. Calling and giving notice of the November 3, 2026, General Municipal Election for the purpose of electing three (3) members of the City Council representing Districts 1, 4, and 5, to serve a four (4) year term through November 2030; and

b. Requesting to Consolidate the General Municipal Election with the Statewide General Election; and authorizing the Fresno County Elections Division to conduct the November 3, 2026, Election; and

c. Establishing Conditions for the filing of Candidates’ Statements.

Staff: Briana Parra, City Clerk
Recommendation: Approve

13. Consider Introduction – Ord. 26-___, Approve an Ordinance authorizing the City Manager to execute a memorandum of understanding with the County of Fresno to enforce its Infectious Materials Ordinance within the City; and adding Chapter 8.19 to Title 8 of the Clovis Municipal Code to adopt by reference the County’s Ordinance to monitor and inspect privately funded laboratories within the City and to delegate enforcement authority to the County.

Staff: Paul Armendariz, Assistant City Manager, Matt Lear, Deputy City Attorney Recommendation: Approve
City Manager Comments
Council Comments

June 15, 2026 - 4 - 6:00 PM
Adjournment
Future Meetings
Regular City Council Meetings are held at 6:00 PM in the Council Chamber. The following are future meeting dates:

July 6, 2026 (Mon.)
July 7 - Aug. 2 Summer Recess
Aug. 3, 2026 (Mon.)

Preliminary - Subject to Approval
- 1 -

City Council Meeting • Minutes

June 8, 2026 6:00 PM Council Chamber

Call to Order
The meeting was called to order by Mayor Mouanoutoua at 6:00 PM.

Flag Salute
Flag Salute led by Councilmember Bessinger
Roll Call

Present: Councilmember Ashbeck, Councilmember Basgall, Councilmember Bessinger, Mayor Pro Tem Pearce, and Mayor Mouanoutoua

Presentations/Proclamations

1. Presentation of Proclamation to the Clovis Community College Forensics Team.

Public Comments
Bill Rogers with Veterans of Foreign Wars, thanked the Mayor for recognizing the Honor Guard and announced upcoming events, including the Central Valley Memorial District's 80th anniversary celebration, a Flag Day ceremony, and Women's Veterans Recognition Day.

Steven Trevino and Brian Wilson, residents, spoke and commended the Council for not increasing Council salaries at the previous Council meeting.

Consent Calendar
Upon call, there was no public comment.

Motion by Councilmember Ashbeck, seconded by Councilmember Bessinger, that the items on the Consent Calendar be approved. Motion carried by unanimous vote.

2. Minutes from the June 1, 2026 City Council Meeting.

3. General Services – Approval – Res. 26-67, Authorizing Amendments to the City's Classification Plan by Revising and Renaming the Classification of Deputy Building Official/Plan Checker to Deputy Building Official/Code Enforcement Officer in the Planning and Development Services Department.

4. Planning and Development Services – Approval – Bid Award for CIP 24-10 Willow Avenue Street Improvements to Granite Construction Company in the amount of $1,069.838.90; and Authorize the City Manager to execute the contract on behalf of the City.

5. Planning and Development Services – Approval – Res. 26-68, Annexation of Miscellaneous Properties to the Landscape Maintenance District No. 1.

Preliminary - Subject to Approval
- 2 -

Public Hearings

6. Consider Approval – Res. 26-69, a Resolution Confirming the Diagram and Assessments for the Fiscal Year 2026-2027 Annual Levy for Landscape Maintenance District No. 1.

The public hearing was opened at 6:22 p.m. The following member of the public addressed the Council regarding the item: Brian Wilson. The public hearing was closed at 6:24 p.m.

Motion for approval by Councilmember Ashbeck, seconded by Councilmember Bessinger. Motion carried by unanimous vote.

Administrative Items

7. Consider Introduction - Ord. 26-04, an Ordinance of the City Council of the City of Clovis Amending Various Provisions of Chapter 6.4 of Title 6 of the Clovis Municipal Code Relating to Sewage Disposal Administration and Regulations, and Amending Various Provisions of Chapter 6.5 of Title 6 of the Clovis Municipal Code Relating to Water Service Rates and Regulations.

The following member of the public addressed the Council on the above item: Ed Stark.

Motion for approval by Councilmember Ashbeck, seconded by Councilmember Basgall. Motion carried by unanimous vote.

8. Consider Approval - Approve the City Council Meeting Telephonic or Internet Service Disruption Policy Pursuant to Government Code Section 54953.4 (SB 707).

The following members of the public addressed the Council on the above item: Steven Trevino, Dr.

Jeni-Ann Kren, and Bill Rogers.

Motion for approval by Councilmember Bessinger, seconded by Councilmember Basgall. Motion carried by unanimous vote.

City Manager Comments
City Manager Haussler announced the June schedule for the Clovis Mobile Recreation Park Tour, which begins at Letterman Park on June 10, 2026. He also shared that the Clovis Youth Commission is accepting applications from students entering grades 10 through , and announced that the Flag Day Celebration will be held on June 14, 2026.

Council Comments
There was no formal Council direction for staff.

Closed Session

9. Government Code Section 54957

PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Title: City Manager
Upon call, there was no public comment.

No Reportable Action.

Preliminary - Subject to Approval
- 3 -

Reconvene into Open Session and Report from Closed Session Adjournment
Mayor Mouanoutoua adjourned the meeting at 7:35 P.M. and the next regularly scheduled meeting is June 15, 2026.

_____________________________ ____________________________ Mayor City Clerk

Report to the City Council

To: City Council
From: Administration
Date: June 15, 2026
Staff: Briana Parra, City Clerk
Subject: Administration – Adopt – Ord. 26-04, An Ordinance of the City Council of the City of Clovis, Amending Chapter 6.4 of the Clovis Municipal Code Pertaining to Administration of Sewage Disposal Provisions; and Amending Chapter 6.5 of the Clovis Municipal Code Pertaining to Water Service Rates and Regulations. (Vote: 5-0)
Recommendation: Adopt
Attachments: None

Report to the City Council

To: City Council
From: Administration
Date: June 15, 2026
Staff: Scott Cross, City Attorney
Subject: Administration - Approval - Res. 26-___, a Resolution Approving a Schedule of Water Rate Increases and Adjustments Effective January 1, 2027, and an Annual Schedule of Adjustments for Future Water Rate Increases Each July 1st Beginning July 1, 2029.

Recommendation: Approve
Attachments:

1. Water Rate Increase ATT 1 Res. 26-

2. Water Rate Increase ATT 2 Draft Ord. 26-04

Recommendation:

For the City Council to approve the resolution approving a schedule of water rate increases and adjustments effective January 1, 2027 and an annual schedule of adjustments for future water rate increases each July 1st beginning July 1, 2029.

Executive Summary:

Council approved a water rate increase on April 20th, 2026, with the increased rates and fees to be effective beginning January 1, 2027. Historically, water rate increases have been codified in the Municipal Code, and annual adjustments have been approved through the Budget process. With the adoption of Ordinance 26-04, amending Clovis Municipal Code section 6.5.103, the updated water rates and fees may now be approved by resolution. The attached Resolution and attached Rate Table document the updated water rates and fees approved following the public hearing and Proposition 218 proceeding on April 20, 2026, with the approved rate and fee increases effective beginning on January 1, 2027.

Background:

The City Council approved the Water Rates and Fees Study on April 20, 2026, which set the new rates and fees to be collected for the water utility beginning on January 1, 2027. This included the required mailed notice to all parcel owners in Clovis subject to the proposed water rates and fees and a public hearing as required by Proposition 218 (CA Constitution, Art. XIII D, Sec. 6). Written protests regarding the proposed rate and fee increases were not submitted by a majority of owners of parcels to which the increased fees were proposed to be imposed, and the City Council duly approved the

proposed rate and fee increases. With past water rate increases, a comprehensive update to the Municipal Code would codify the new rates and fees. However, those rates and fees codified in the Code become outdated in the following years, and a review of subsequent authorized rate/fee adjustments and Council actions coupled with a series of calculations is needed to determine the current rates and fees in later years.

Ord. 26-04 simplified the water rates and service fees for the public and City staff by authorizing the rates and fees to be set by Council resolution. This Resolution follows the Ordinance with a schedule showing the approved rate and fee increases beginning January 1, 2027 and the authorized 3.0% annual increase beginning July 1, 2029. The Resolution and rate/fee attachment will be available for the public and City staff to see the applicable rates and fees at any given time in future years rather than referring to lengthy text in the Municipal Code and performing a series of calculations to determine the applicable rates/fees.

Fiscal Impact:

Approval of the Resolution allows for the water rates and fees approved following the public hearing and Proposition 218 proceeding on April 20, 2026 and the approved schedule of rate and fee increases to become effective beginning on January 1, 2027. As presented during the public hearing on April 20, 2026, the approved rate and fee structure will provide for long-term financial sustainability of the Water Enterprise account.

Reason for Recommendation:

This Resolution follows the adoption of Ord. 26-04 this evening. If approved, the Resolution and attached Rate Table will document the new water rates and fees beginning on January 1, 2027, and in subsequent years in accordance with the water rates and fees increase approved on April 20, 2026.

Actions Following Approval:

The approved water rates and fees as reflected in the Resolution and attached Rate Table will be implemented.

Conflict of Interest:

None.

ATTACHMENT 1
RESOLUTION 26-___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CLOVIS APPROVING

WATER RATE AND SERVICE CHARGE INCREASES AND ADJUSTMENTS EFFECTIVE ON JANUARY 1, 2027

WHEREAS, Government Code Section 54344 authorizes the City to prescribe, revise, and collect charges for the services, facilities, and water furnished by the City as part of the municipal water system and water enterprise; and

WHEREAS, Section 6.5.103 of the Clovis Municipal Code, as amended, provides for water service rates and charges to be set by City Council resolution; and

WHEREAS, the City retained Raftelis Financial Consultants Inc. (“Raftelis”) as a consultant to review the City’s municipal water system and water enterprise, perform a cost of service analysis and develop a proposed rate model, and prepare a comprehensive Water Rate Study (“Rate Study”) for the City to consider implementing to meet the City’s costs of providing water service; and

WHEREAS, the City Council conducted public workshops and meetings on the Rate Study during City Council meetings on November 3, 2025, and January 20, 2026, during which the proposed water rate and service charge increases identified in the Rate Study were reviewed and discussed, and comments were received from the City Council and the public; and on January 20, 2026, the City Council approved the Rate Study and provided direction on the proposed increased water rate s and service charges , and directed staff to proceed with the required public hearing on April 20, 2026, and majority protest proceeding in accordance with Proposition 218 for the City Council to consider approval of the proposed increased rates and charges; and

WHEREAS, written notice of the proposed increased water rates and service charges was duly mailed to the record owners of each parcel in the City in accordance with the requirements of Proposition 218 and Government Code section 53755; and

WHEREAS, a public hearing to consider the proposed water rates and service charges and any protests to the proposed rates and charges was duly held and conducted at the City Council meeting on April 20, 2026, which meeting and hearing was more than 45 days after written notice was duly mailed to property owners and water customers in accordance with the requirements of Proposition 218 and Government Code section 53755; and

WHEREAS, written protests to the proposed increased water rates and service charges were not presented by a majority of the owners of the identified parcels in the City of Clovis before the close of the public hearing, and therefore a majority protest to the proposed increased water rates and service charges did not exist , and the City Council was authorized and did approve the proposed increased water rates and service charges as presented in the Rate Study, the written notice to record owners of each parcel in the City, and in the materials for the City Council meeting on April 20, 2026; and

WHEREAS, the City Council deems it in the public interest to document the approval of the schedule d water rate and service charge increases as authorized by applicable law in a resolution rather than a comprehensive municipal code amendment ; and

WHEREAS, Exhibit “A” attached hereto, including an annual authorized 3.0% rate increase beginning July 1, 2029, and each July 1 thereafter, accurately reflects the scheduled water rates and service charges approved by the City Council on April 20, 2026, following a duly conducted majority protest proceeding in accordance with Proposition 218.

NOW, THEREFORE, BE IT RESOLVED, that the City of Clovis shall proceed as follows:

1. The water rates and service charges set forth in Exhibit “A” attached hereto are hereby approved and adopted as the scheduled new water rates and service charges effective beginning on J anuary 1, 2027 , and all customers receiving City water service shall be billed accordingly as set forth in Exhibit “A”.

2. Beginning July 1, 20 29, and annually each July 1st thereafter , the water rates and service charges are approved to be increased by up to 3.0% as approved by City Council resolution, including the annual City budget resolution, based on an annual recommendation by the Public Utilities Director . The Public Utilities Director’s recommendation shall be based on a review and evaluation of the water fund balance annually before June 1 st, and the recommendation in any given year may be for the authorized 3.0% rate increase, an increase less than the authorized 3.0%, no rate change, or a rate reduction, and any increase not exceeding the authorized 3.0% in any given year shall not constitute an “increase” pursuant to Proposition 218 or the Proposition 218 Omnibus Implementation Act.

3. The approved increased water rates and service charges are required to cover the cost of providing such services to the users thereof and the rates and charges are non-discriminatory and do not exceed the estimated proportional cost of providing water services for which the rates and charges are imposed.

* * * * *

The foregoing resolution was introduced and adopted at a regular meeting of the City Council of the City of Clovis held on June 15, 2026, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN

DATED:

_____________________________ ______________________________ Mayor City Clerk

Exhibit A
City of Clovis
Water Utility
Current and Proposed Rates and Service Charges
Existing Proposed
Description FY26 FY27 FY28 FY29 FY30 FY31
BIMONTHLY SERVICE CHARGE, $ PER BILL
Residential
Single Family [1] $27.71
Multifamily [1] 27.71
Mobile Home [1] 27.71
Tarpey Metered Residential [1,2] 27.71
Tarpey - Non-Metered Res Large Lot [1,2] 6.67
Tarpey - Non-Metered [1,2] 139.05
Residential [3], Commercial, and Landscape (Retail Potable Water Users) Meter Size
Inches
5/8 $22.30 $33.46 $40.49 $47.78 $49.21 $50.69
3/4 22.30 33.46 40.49 47.78 49.21 50.69
1 22.30 33.46 40.49 47.78 49.21 50.69
1 1/2 29.66 55.36 66.99 79.05 81.42 83.86
2 40.97 81.64 98.78 116.56 120.06 123.66
3 81.13 151.72 183.58 216.62 223.12 229.81
4 204.08 230.57 278.99 329.21 339.09 349.26
6 814.05 449.58 543.99 641.91 661.17 681.01
8 1,443.03 800.00 968.00 1,142.24 1,176.51 1,211.81
10 2,260.71 1,062.81 1,286.00 1,517.48 1,563.00 1,609.89 Recycled
Meter Size
inches
5/8 $22.30 $25.87 $31.30 $36.93 $38.04 $39.18
3/4 22.30 25.87 31.30 36.93 38.04 39.18
1 22.30 25.87 31.30 36.93 38.04 39.18
1 1/2 29.66 40.18 48.62 57.37 59.09 60.86
2 40.97 57.35 69.39 81.88 84.34 86.87
3 81.13 103.14 124.80 147.26 151.68 156.23
4 204.08 154.66 187.14 220.83 227.45 234.27
6 814.05 297.76 360.29 425.14 437.89 451.03
8 1,443.03 526.71 637.32 752.04 774.60 797.84
10 2,260.71 698.43 845.10 997.22 1,027.14 1,057.95
Private Fireline
Line Size
inches
4 and less $204.08 $20.15 $24.38 $28.77 $29.63 $30.52
6 204.08 36.52 44.18 52.13 53.69 55.30
8 204.08 64.74 78.34 92.44 95.21 98.07
10 204.08 107.20 129.72 153.07 157.66 162.39
12 204.08 166.05 200.92 237.09 244.20 251.53
Construction Water $139.05 $154.66 $186.89 $220.58 $227.41 $234.29 Hydrant Meter Water, $ per bill per month $40.57 $40.82 $49.39 $58.28 $60.03 $61.83 [1] The proposed service charge by meter size applies to all customer classes.

Under existing rate structure, residential customers were charged a fixed, per dwelling charge. [2] Tarpey are billed the same as inside City residential. [3] Service charge applies to all Residential classes in FY27. [4] Current construction water charges are based on Tarpey Non-Metered charges.

Proposed construction water charges are based on the 1" meter charge plus 60,000 of water usage at the proposed volume rates for each year.

Existing Proposed
Description FY26 FY27 FY28 FY29 FY30 FY31
VOLUME RATES, $ PER 1,000 GALLONS
Resdential - Single Family, Multifamily, Mobile Home [1] Tier 1: (0 - 23,000 gal) $1.13 $2.02 $2.44 $2.88 $2.97 $3.06 Tier 2: (23,000 - 40,000 gal) 1.88 2.02 2.44 2.88 2.97 3.06 Tier 3: (Over 40,000 gal) 2.33 2.02 2.44 2.88 2.97 3.06 Commercial and Landscape
Tier 1: (0 - 23,000 gal) $1.13 $2.02 $2.44 $2.88 $2.97 $3.06 Tier 2: (Over 23,000 gal) 1.53 2.02 2.44 2.88 2.97 3.06 Recycled
Pressurized $0.71 $0.87 $1.05 $1.24 $1.28 $1.32
Non-Pressurized 0.076 0.072 0.090 0.110 0.110 0.110
Hydrant Meter Water $ per 1,000 gallons [2] Note [2] $2.02 $2.44 $2.88 $2.97 $3.06 [1] Tarpey are billed the same as inside City residential [2] Existing hydrant meter volume rate based on Commercial and Landscape volume rates.

Line
No. Description Existing FY27 FY28 FY29 FY30 FY31
Current Proposed Proposed Proposed Proposed Proposed
1 Months Increase is Effective in First Year January 1, 2027 January 1, 2028 January 1, 2029 July 1, 2029 July 1, 2030 2 Annualized Percentage Increase 0.0% 21.0% 21.0% 18.0% 3.0% 3.0% 3 Cumulative Increase 0.0% 21.0% 46.4% 72.8% 77.9% 83.3% Rate Structure: Potable Water
Drought Response Surcharge ($/1,000 gal)
Conservation Goal FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 < 10% $0.00 $0.00 $0.00 $0.00 $0.00
Up to 20% $0.23 $0.27 $0.32 $0.33 $0.34
Up to 30% $0.51 $0.61 $0.72 $0.74 $0.77
Up to 40% $0.87 $1.05 $1.23 $1.27 $1.31
Up to 50% $1.35 $1.63 $1.92 $1.98 $2.04
> 50% $2.02 $2.44 $2.88 $2.97 $3.06
Note [1]
Note [1]
Note [1]
Note [1,2]
Note [1,2]
Note [1,2]

Attachment 2
ORDINANCE 26-04

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CLOVIS AMENDING VARIOUS PROVISIONS OF CHAPTER 6.4 OF TITLE 6 OF THE CLOVIS MUNICIPAL

CODE RELATING TO SEWAGE DISPOSAL ADMINISTRATION AND
REGULATIONS, AND CHAPTER 6.5 OF TITLE 6 OF THE CLOVIS MUNICIPAL

CODE RELATING TO WATER SERVICE RATES AND REGULATIONS

The City Council of the City of Clovis does ordain as follows:

Section 1. Section 6.4.01.1 is hereby added to Chapter 6.4 of Title 6 of the Clovis Municipal Code to read as follows:

6.4.01.1 Administration.

The Public Utilities Director shall administer, implement, and enforce the provisions of this chapter, except insofar as another officer or employee of the City shall be charged with the administration or regulation of a specific provision of this chapter. The Public Utilities Director shall be responsible for preparing a sewer master plan, which includes an evaluation of the City’s existing sewer capacity, infrastructure, and sewage treatment and plans for future sewer capacity, sewage treatment, and infrastructure needs to assist in community planning and ensuring a safe, reliable, and cost-effective sewage disposal and treatment while protecting public health and the environment.

Section 2. Sections 6.4.03.1, 6.4.06, 6.4.15, 6.4.18, and 6.4.20 of Chapter 6.4 of Title 6 of the Clovis Municipal Code are hereby amended to read as follows:

6.4.03.1 Sewer lift station reimbursement fees.

(a) Purpose. The Council hereby finds and declares that the cost of constructing and furnishing sewer lift stations in certain areas to provide interim service for development is in excess of the sanitary sewer facilities that are generally applicable to other territory in the City and that, in order to protect the public health and welfare and install sewer lift stations, the fees provided for in this section are reasonable and necessary.

(b) Service areas. When it is determined by the City Engineer and Public Utilities Director that a lift station will be constructed to provide interim service for an area within the City, the City Engineer and Public Utilities Director shall determine the identified service area and shall allocate the cost of the lift station and appurtenances to all parcels within the service area according to each parcel’s potential flow generation as determined

by the sewer master plan. The costs allocated to each of the parcels within the service area shall be payable upon development of each parcel. If permanent, master planned sewage conveyance that eliminates the need for the interim lift station facilities is provided prior to or in conjunction with the development of a parcel or parcels within the identified service area, the requirement for the remaining parcels in the service area to participate in the cost of the lift station facilities will be terminated.

(c) Payment of fees. The fees imposed pursuant to this section shall be payable as follows:
(1) Such fees shall be paid for each lot or parcel delineated on a subdivision map or parcel map prior to the recording of such map.

(2) In any case where such fee has not previously been paid for a lot or parcel for development on which a building permit involving a connection to the sewer system is required, such fee shall be paid prior to the issuance of a building permit.

(d) Use of fees. The fees collected as provided in this section shall be used toward the cost of the construction, or for the reimbursement of the cost of the construction, of sewer lift stations, sewer pump facilities, and associated force mains within the service area for which the fee was collected.

(e) All fees shall include an administrative charge not to exceed the percentage shown in the Master Development Fee Schedule to cover the cost of the City’s record keeping and handling, except that if sufficient fees are held in the particular fund and general interest sufficient to cover such costs, the administrative charge will be taken from such interest.

6.4.06 Sewer service: Conditions.
(a) All persons using the sewer system of the City shall pay for such service and for the privilege of connecting to the sewer at the rates, at the times, and under the conditions set forth in this chapter and shall comply with all the regulations set forth in this chapter relating to the use of such sewer system.
(b) All sewer service laterals connecting a user, whether a single-family residence, commercial building, or other structure, to a City-owned sewer main located in the public right-of-way or easement shall be owned, maintained and repaired by the owner of the property being served, from and including the lateral’s connection point at the City sewer main to the building or other point of use on the property. This includes both the portion on private property and the portion located beneath the sidewalk and

street or any other public right-of-way or easement areas such as alleys, trails and landscape areas, up to and including the point where the lateral connects to the City sewer main.
(c) Sewer main and service shut offs. The City may shut off sewer mains or at any service at any time for the purpose of making repairs to mains, installing services or extensions, or for other reasons as determined necessary by the Public Utilities Director for the protection of the City sewer system or the public health or welfare.

6.4.15 Discharge prohibitions and industrial reporting requirements.

For the purpose of defining the prohibitions of discharges into the City sewer system and the reporting of requirements of industrial users, Sections 6-327 and 6-336 of Article 3 of Chapter 6 of the City of Fresno Municipal Code, as may be amended, is hereby adopted by reference, except that:
(a) “City” means the City of Clovis.
(b) “Finance Department” means City of Clovis Finance Department. (c) “Public Works Director” means City of Clovis Public Utilities Director. (d) “City Manager” means City of Clovis City Manager.
(e) “Council” means Clovis City Council.
(f) “Director” means City of Clovis Public Utilities Director. (g) “City Clerk” means Clovis City Clerk.

6.4.18 Duty of enforcement.

For the purpose of defining the duty of enforcement and enforcement provisions and procedures, Section 6-323 of Article 3 of Chapter 6 of the City of Fresno Municipal Code, as may be amended, is hereby adopted by reference, except that:
(a) “City” means City of Clovis.
(b) “Chapter 2 Article 11” shall mean Chapter 6.5, Section 6.5.110(b) of the Clovis Municipal Code.

6.4.20 Wastewater Discharge Permits.

For the purposes of controlling and monitoring discharges from nondomestic users and for implementing pertinent industrial wastewater discharge control and pretreatment requirements, Section 6-335 of Article 3 of Chapter 6 of the City of Fresno Municipal Code is hereby adopted by reference.

Section 3. Sections 6.5.101 through 6.5.105 and Sections 6.5.110 through 6.5.112 of Chapter 6.5 of Title 6 of the Clovis Municipal Code are hereby amended to read as follows:

6.5.101 Administration.

The Public Utilities Director shall administer, implement, and enforce the provisions of this chapter, except insofar as another officer or employee of the City shall be charged with the administration or regulation of a specific provision of this chapter. The Public Utilities Director shall be responsible for preparing a water master plan, which includes an evaluation of the City’s existing water supply and infrastructure, and plans for future water supply and infrastructure needs to assist in community planning and ensuring a clean, reliable, and cost-effective water supply while protecting public health and the environment.

6.5.102 Applications for Water Service.

Before water shall be supplied to any premises, the owner or occupant of the property shall make a written application to the City for water service on a form provided by and containing such information as may be required by the City, including but not limited to presentation of a form of government-issued identification. Thereupon, a service connection shall be made at the nearest distribution main after the charges provided for in this section have been paid. Industrial developments for nonfood processing functions shall, as a first choice, use nonpotable water from the City’s infrastructure, subject to availability to the site and as approved by the Public Utilities Director.

The applicant, on making such application, shall pay a fee of ten and no/100ths dollars ($10.00) for opening a water service account, which fee shall not be refunded. (a) Deposits. The City shall require an applicant for water service to guarantee the payment of water and other utility user charges with a cash deposit in the sum of one hundred fifty and no/100ths dollars ($150.00) or, for commercial customers and multifamily customers, a deposit of an amount equal to the sum of the minimum water, sewer, street sweeping, recycling, greenwaste and refuse service as requested by the customer for one billing period. If such customer has previously been a water service customer of the City (within the corporate limits of the City) for at least two (2) years and does not currently carry a delinquent balance, they will not be required to pay the deposit. (b) Return of deposits. Deposits shall be held by the City for a minimum period of two (2) years. The deposit shall be returned to the customer after two (2) years, but not sooner than six (6) months after any one delinquency, if more than one.

(c) Purchaser’s responsibility. An owner or purchaser of a premises maintaining water or sewer connections shall assume responsibility for financial obligations of such service effective the date possession of the property is taken.

6.5.103 Water Rates and Service Charges for City service area customers. (a) Basic Rates and Service Charges. Unless otherwise provided in an extraterritorial service agreement as provided in Section 6.5.104, each customer in the City’s service area connected to the City’s water system shall pay, as a condition of water service, applicable rates and service charges as established by City Council resolution. (b) Drought Response Rates During Declared Water Emergency. Notwithstanding subsection (a) above, during any declared state of emergency by the State or City related to potable water conditions that mandate water conservation in the City, when State or Federal regulations that mandate water conservation in the City are in effect, or during local water shortages, a drought response surcharge as approved by City Council resolution shall be applicable and added to the basic volume rates for water. (c) For any standby service, including fire sprinkler systems, the availability charge to each customer shall be an amount established by City Council resolution. (d) As a condition of and prior to the issuance of any building permit for the construction of a building where water service is to be utilized, but where no water meter has been installed, the person to whom such permit is issued shall pay an on-site construction water charge for each service in an amount established by City Council resolution for a period of time not to exceed twelve (12) months provided the permittee installs, at his cost, an approved spacer. At the conclusion of said twelve (12) months, water service will only be provided after the installation of a water meter in accordance with the regulations set forth in this article. The spacer shall become the property of the City.
(e) Any person receiving a permit to take water from a fire hydrant shall pay a hydrant meter fee in an amount established by City Council resolution and the applicable water volume rate for water used as established by City Council resolution.

6.5.104 Extraterritorial Water Service Agreements for Water Service Outside City Service Area.
(a) Notwithstanding any other provision of this chapter, City water service may be provided outside the City service area pursuant to an extraterritorial service agreement which may include requirements, payments, rates, or charges than otherwise imposed on customers within the City service area and connected to the City’s water system.

6.5.105 Utility Bills.

Regular utility bills shall be issued on a bimonthly basis according to the billing dates established by the Director of Finance. Utility bills shall include charges for all city utility services.
(a) Payment. All charges for water shall be due and payable on the billing date. All unpaid water charges shall become delinquent at 12:01 a.m. on the day after the due date indicated on the utility bill.
(b) Proration. The charges for water shall be prorated to the nearest ten percent (10%) of the billing period as determined by the date of the starting and ending of service as recorded by the Finance Department upon notification to the Finance Department by the owner or occupant.
(c) Meter failures. If a meter fails to register during any billing period or is known to register inaccurately, the consumer shall be charged on the basis of the consumption as shown by the meter when in use and registering accurately over a period of one year or, in the event the consumer has not received water for a period of one full year, then over such lesser period.
(d) Consumers’ dissatisfaction with meters. In case of a consumer’s dissatisfaction with the registration of any meter, the consumer shall make a written complaint to the Director of Finance, together with a deposit of eighty-four and no/100ths dollars ($84.00), which sum will be returned and the water bill equitably adjusted for a period of not to exceed the prior twelve (12) months in any case where the meter shall be found to register over three percent (3%) more than the amount of water which actually passes through the meter. The eighty-four and no/100ths dollar ($84.00) deposit shall be retained by the City and the water bill paid as rendered; if the meter is found to register less than three percent (3%) more than the amount of water which actually passes through the meter, the deposit shall be forfeited and the bill equitably adjusted for a period of not to exceed the prior twelve (12) months.
(e) Billing errors. In the event a clerical error or other circumstance occurs which creates an inaccurate billing for service charges, an adjustment shall be made in the customer’s bill for a period not to exceed the maximum period as provided in the Code of Civil Procedure, either in the customer’s favor or the City’s favor.

6.5.110 Other Regulations.

(a) Only City may turn water on. No person shall tap, open, or connect any water service, and no person shall cause, permit, or allow any water main to be turned on or connected after the water service has been turned off by the City.

In the event any person turns on or connects water service after it has been turned off or disconnected by the City, the City shall again turn off or disconnect the water service, and lock or remove the water meter from the premises, and charge and collect one hundred seventy-five and no/100ths ($175.00) dollars, in addition to all other charges and penalties, before water service is restored. If, as a result of tampering, the meter or service is damaged, an additional fee of five hundred and no/100ths ($500.00) dollars shall be charged and collected in addition to all other charges and penalties, before water is restored.
(b) Water service penalties for waste or violations. For any water supplied by the City which is wasted by a customer a fee shall be charged to the customer and added to the customer’s account. For the first violation, a written warning will be given to the customer. For the second violation within a one-year period, a fee of thirty and no/100ths dollars ($30.00) shall be charged. For the third violation within a one-year period, a fee of sixty and no/100ths dollars ($60.00) shall be charged. For the fourth and subsequent violations within a one-year period, a fee of ninety and no/100ths dollars ($90.00) shall be charged. For any customer who incurs within a one-year period four (4) or more water waste violations or does not comply with the water efficient landscape requirements, the City may implement any or all of the following measures:
(1) Require a customer to get a landscape evaluation, lawn water audit, and water budget, as appropriate, in order to learn efficient water use. This work would be completed at customer expense;
(2) Require a customer to repair any defects in the watering system of such customer within fourteen (14) days’ notice by the City to repair; (3) Require installation by the City of flow restrictors or termination of water service for exterior use;
(4) Termination of all water service to a customer.

In addition to the foregoing, during any declared state of emergency by the State or City related to drought or potable water conditions that mandate water conservation in the City, State or Federal regulations that mandate water conservation in the City, or during local water shortages, the City Council may by resolution adopt mandatory water usage limits and impose penalties on the customer for violations of those usage limits.

The penalties shall be added to the customer’s account. A violation of the usage limits shall also be deemed a violation of the Municipal Code.

Water service shall be turned off and discontinued to any premises on or from which water supplied by the City is being disposed or used in violation of any law of the City other than wasting or noncompliance with water efficient landscape requirements.

Water service shall not be restored to any premises until the owner and the occupant thereof terminate any violation and agree not to continue to repeat such violation. Such agreement shall be guaranteed by a cash deposit in such sum as the Director of Finance shall fix, not to exceed one hundred and no/100ths dollars ($100.00). (c) Meters City property. All services and all water meters installed by the City shall remain the property of the City. The expense of the maintenance, repair, and removal of such meters, due to the wear of normal service, shall be borne by the City; provided, however, any expense occasioned by any act, careless or otherwise, on the part of the consumer, or any member of his family, or any person in his employ, shall be charged to such consumer.
(d) City not responsible for water damages. The City shall not maintain or repair any water pipe from the meter to the premises served, and the City shall in no case be liable for damages occasioned by water running free from open or faulty fixtures or from broken or damaged pipes.
(e) Unlawful to connect other water. No person shall allow a connection to be made or exist between the City’s water system and another source of water supply or water system unless such connection is fitted with a suitable backflow prevention device approved by the City and the County Health Office preventing water from such other source of supply entering the City’s water system.
(f) Unlawful furnishing or receiving of water. No person receiving City water shall furnish such water to any premises other than that to which the City bills or meters such water, and no person shall furnish or receive City water to any premises for which the water rates prescribed by the City are not being paid.
(g) Bypass connections unlawful. Any bypass or connection around the meter between the service and the main shall be prohibited unless specifically authorized by the Director of Public Utilities for a limited period of time because of emergency work. All water used on any premises shall pass through the water meter. (h) Unlawful entries on water facilities. No person shall climb on or upon any water tower or water tank to enter on or upon any pump house or pit without a permit from the Public Utilities Department.
(i) Unlawful to cover meter boxes. No person shall cover meter boxes with trash, rubbish, dirt, or other foreign matter, or permit ivy or other shrubbery to grow over meter boxes, or park automobiles or other vehicles over meter boxes. Direct access to the water mater shall be maintained by the property owner.

(j) Unlawful to tamper with meters, related service equipment, or break seals. No person shall tamper with or remove any water meter or related service equipment which is attached to or accompanies any service or break any meter seal or related service equipment. No person shall make any water connection or connect to any pipe or meter box, except for a single house connection.
(k) Unlawful to water waste. No person shall willfully or negligently waste water or unreasonably flood any premises. Wasting water shall include noncompliance with any water conservation program which the City enacts for the public safety or welfare. (l) Inspections. The Director of Finance, the Director of Public Utilities, City Engineer, or any other authorized officer of the City shall be admitted during normal working hours to all parts of any premises provided with a City water service for the purpose of inspection to ensure that applicable laws and regulations of the City and State pertaining to water and water services are complied with.

6.5.111 Water restrictions.

The use of water supplied by the City may be restricted or prohibited by the City when water conservation is required for the public safety or welfare. (a) Water to be shut off in case of fire. When a fire occurs in the City, all standpipes, fireplugs, hose connections, faucets, and other outlets to the City water system shall be subject to the direction of the Chief of the Fire Department and shall be promptly closed, except such as may be used in quenching the fire and preventing the spread of the fire, and shall be kept closed until such fire is extinguished. (b) Water main and service turnoffs. The City may shut off water in the mains or at any service at any time for the purpose of making repairs to mains, installing services or extensions, or for other reasons as determined necessary by the Director of Public Utilities for the protection of the City water system, water supply, or public safety or welfare.

6.5.112 Backflow prevention devices required.

No person shall install or maintain any water-operated equipment or mechanism or use any water-treating chemical or substance, or install or maintain any water consumption facilities capable of polluting the City water supply (“cross-connection”), unless the water service to the premises upon which such equipment, mechanism, chemical, substance, or water consumption facilities are utilized is equipped with a City approved backflow prevention device.

Such approved backflow prevention device(s) shall be installed on any new facilities where the Public Utilities Department or Building Division makes such a requirement as a condition of approval of any building entitlement for the premises, or, in

the case of an existing facility, immediately upon notice by the Public Utilities Department or Building Division that a cross-connection condition exists, or within thirty (30) days of notice of a potential cross-connection condition. Failure to install such devices or to take such actions as necessary to eliminate existing or potential cross-connection conditions will be cause to discontinue water service to the affected premises.

Any such installation shall be at the owner’s expense and at a location between the water meter and the premises served and at such point of connection as may be designated or approved by the Public Utilities Department or Building Division.

The owner shall be responsible to keep all such devices in a good state of repair.

Repairs, adjustments, and tests shall be performed only by persons who have been certified for such work by an agency approved by the City. No less than once each year the owner at his expense shall cause a certified test report(s) be submitted to the Public Utilities Department indicating all such devices on or serving owner’s premises are in good operating condition. In the case of a new installation, a certified test report shall be submitted within five (5) working days of the date of installation. Failure to provide such annual or other test report(s) upon notice by the City shall be cause to discontinue water service to owner’s premises until such time as the required test report(s) is received by the Public Utilities Department.

Section 4. Sections 6.5.303 of Article 3 of Chapter 6.5 of Title 6 of the Clovis Municipal Code is hereby amended to read as follows:

6.5.303 Standby fire service lines.

Any person who desires standby fire service lines shall install and maintain in their entirety such lines at his own cost and expense only after receiving a permit therefore issued by the City, and all such lines shall be installed in such a manner and in such specifications as the City may require.
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Section 5. This Ordinance shall go into effect and be in full force from and after thirty (30) days after its final passage and adoption.

APPROVED: June 8, 2026

______________________________ ______________________________ Mayor City Clerk

* * * * * * * * * *

The foregoing Ordinance was introduced at a regular meeting of the City Council held on June 8, 2026, and was adopted at a regular meeting of said Council held on June 15, 2026, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

DATED:

___________________________________
City Clerk

Report to the City Council

To: City Council
From: General Services Department
Date: June 15, 2026
Staff: Bethany Berube, Deputy General Services Director Subject: General Services - Approval of the Clovis Transit Public Transportation Agency Safety Plan (PTASP).

Recommendation: Approve
Attachments:

1. Clovis Transit PTASP ATT 1 Policy

Recommendation:

For the City Council to approve the Clovis Transit Public Transportation Agency Safety Plan (PTASP).

Executive Summary:

On July 19, 2018, the Federal Transit Administration (FTA) published the PTASP Final Rule (49 CFR Part 673) requiring operators of public transportation systems that are recipients or subrecipients of FTA funds to develop an Agency Safety Plan (ASP). As a new FTA funding recipient, Clovis Transit's PTASP was first approved by Clovis City Council on June 16, 2025. The regulation requires that Clovis Transit conduct an annual review, update, and recertification to ensure compliance and effectiveness.

Background:

As a recipient of FTA funding, Clovis Transit must follow the PTASP Final Rule (49 CFR Part 673).

This includes an annual review by the Safety Committee, the Chief Safety Officer, and the Deputy General Services Director, who serves as the Accountable Executive, before submitting it to the City Council for approval. The PTASP has been updated in accordance with FTA guidance and was reviewed and approved by the Safety Committee, Chief Safety Officer, and Accountable Executive on May 27, 2026.

The PTASP includes processes and procedures to implement a Safety Management System (SMS).

This is a comprehensive, collaborative, and systemic approach to managing safety. The PTASP must also include performance targets for the performance measures established by the FTA in the National Public Transportation Safety Plan (published on January 28, 2017). Transit agencies are required to make their safety performance targets available to the State and Metropolitan Planning

Organization (MPO), i.e., Fresno Council of Governments (Fresno COG), for inclusion in their planning processes.

Fiscal Impact:

None.

Reason for Recommendation:

City Council approval of the PTASP is required in order for Clovis Transit to maintain its status as a recipient of FTA funding. FTA funding is a critical funding source for transit operating assistance, the purchase of vehicles, and the advancement of several projects.

Actions Following Approval:

Policy will be forwarded to the FTA for final approval of this year's annual policy renewal.

Conflict of Interest:

None.

Attachment 1
Clovis Transit
Public Transportation
Agency Safety Plan
(PTASP)
Approved by Clovis City Council
MMDDYY

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Table of Contents

I. TRANSIT AGENCY INFORMATION ............................................................................................1 II. PLAN DEVELOPMENT, APPROVAL, AND UPDATES ............................................................2 III. ANNUAL SAFETY PERFORMANCE TARGETS .......................................................................3 IV. COORDINATION WITH METROPOLITAN, STATEWIDE, AND NON-METROPOLITAN PLANNING PROCESSES .....................................................................................................................4 V. SAFETY RISK REDUCTION PROGRAM ....................................................................................4 VI. SAFETY COMMITTEE ESTABLISHMENT, MEMBERSHIP, AND PROCEDURES .............5 VII. SAFETY MANAGEMENT SYSTEM (“SMS”) ..............................................................................7 VIII. SAFETY MANAGEMENT POLICY ...............................................................................................7 IX. SAFETY RISK MANAGEMENT ..................................................................................................12 X. SAFETY ASSURANCE ................................................................................................................17 XI. MANAGEMENT OF CHANGE ....................................................................................................18 XII. SAFETY PROMOTION ................................................................................................................19 XIII. ADDITIONAL INFORMATION .....................................................................................................21

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I. TRANSIT AGENCY INFORMATION

Transit Agency Name Clovis Transit
Transit Agency Address 785 3rd Street, Clovis, CA 93612 Name and Title of
Accountable Executive
Bethany R. Berube, Deputy General Services Director
Name of Chief Safety
Officer
Byron Bolton, Transit Supervisor and Chief Safety Officer Mode(s) of Service Covered
by this Plan
Fixed Route Bus (Stageline)
Paratransit (Round Up)
Mode(s) of Service Provided
by the Transit Agency
(directly operated or
contracted service)
Fixed Route Bus,
Paratransit List All FTA
Funding Types
(e.g., 5307,
5337, 5339)
5307, 5310, 5339
Does the Agency Provide
Transit Services on Behalf of
Another Transit Agency or
Entity?
No Description of
Arrangement(s)
Not Applicable
Name and Address of Transit
Agency(ies) or Entity(ies) for
which Services is Provided

Not applicable
The transit agency serves a
large urbanized area.

Clovis Transit is a small urban transit agency that provides service to portions of a large urbanized area, including Tarpey Village and parts of the City of Fresno

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II. PLAN DEVELOPMENT, APPROVAL, AND UPDATES

This PTASP (or “Plan”) addresses all requirements as outlined in the Federal Transit Administration (“FTA”) Public Transportation Safety Program and the National Public Transportation Safety Plan. The PTASP has been prepared in accordance with the PTASP Safety Rule published by the FTA on April 11, 2024. The PTASP may be revised following established standards by the FTA through the public notice and comment process.

This PTASP in adopted in compliance with 49 CFR Part 673.

Name of Person(s) Who
Drafted this plan Bethany Berube, Deputy General Services Director Signature of Accountable
Executive Date of Signature Signature by the
Accountable Executive

Deputy General Services Director

Date of Approval

Relevant Documentation
Approval by the Clovis City
Council
- A copy of the City Council Resolution approving the Plan and related staff report is maintained on file by the Transit Manager and Transit Chief Safety Officer
The Plan or Plan update
was developed in
cooperation with frontline
transit worker
representatives.

- The Plan was developed in cooperation with the transit worker representatives. This cooperation was achieved
through the following methods:
• Employee Feedback Surveys
• Review and Feedback from Union Representatives
Approval by the Safety
Committee
- Date of Approval: _____________
- Meeting Minutes with Chief Safety Officer

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Version Number and Updates
Version
Number
Section/
Pages
Affected

Reason for Change Date
Issued
1 New Document
2 Annual Renewal, 2026

Annual Review and Update of the Public Transportation Agency Safety Plan This Plan will be jointly reviewed and updated by the Safety Committee, the Chief Safety Officer and Deputy General Services Director by July 1 of each year. The Accountable Executive will review and approve any changes, sign the new Plan, then forward to the City Council for review and approval.

III. ANNUAL SAFETY PERFORMANCE TARGETS

Safety Performance Targets
Safety Performance Management (Safety PM) is part of the overall Transportation Performance Management (TPM) program, which Federal Highway Administration (FHWA) defines as a strategic approach and uses system information to make investment and policy decisions, to achieve national performance goals. The following are performance targets based on the safety performance measures established under the National Public Transportation Safety Plan.

All performance measures will be evaluated over a fiscal year period and compared to a three-year average of data reported to the National Transit Database (NTD). Since Clovis Transit is a new federal grant recipient and will begin drawing funds in 2025, the performance targets for the first year are based on the Clovis Transit’s voluntary NTD reporting for FY 2024–2025.

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Safety Targets
Measure Paratransit Fixed Route
Major Safety Events 0.00 0.00
Rate of Major Safety Events 0.00 0.00
Collisions 0 0
Rate of Collisions 0.00 0.00
Rate of Pedestrian Collisions 0.00 0.00
Rate of Vehicular Collisions 0.00 0.00
Fatalities 0 0
Rate of Fatalities 0.00 0.00
Rate of Transit Worker Fatalities 0.00 0.00
Injuries 0 0
Rate of Injuries 0.00 0.00
Rate of Transit Worker Injuries 0.00 0.00
Assaults on Transit Workers 0 2
Rate of Assaults on Transit Workers 0.00 0.68
System Reliability 13,800 mi 13,900 mi

IV. COORDINATION WITH METROPOLITAN, STATEWIDE, AND NON-

METROPOLITAN PLANNING PROCESSES

The Accountable Executive will share the Plan, including safety performance targets, with the Metropolitan Planning Organization (MPO) in the service area, the Fresno Council of County Governments (FCOG), each year after its formal adoption by the City Council. The Accountable Executive will also provide a copy of the formally adopted plan for the California Department of Transportation. Clovis Transit personnel are available to coordinate with Caltrans and the MPO in the selection of Caltrans and FCOG safety performance and targets upon request.

Fiscal Year of Performance Date Targets Transmitted
2025 Upon plan approval
2026 Upon plan approval

Targets Transmitted
to the State/MPO

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V. SAFETY RISK REDUCTION PROGRAM
Risk mitigation is primarily achieved through Clovis Transit’s safety committee structure, which consists of the bimonthly Safety Committee meetings. These efforts are designed to address and reduce assaults on transit workers, ensuring compliance with 49 CFR673.25(d)(4) and 673.11(a)(7)(ii). In addition, the committees address the reduction and mitigation of vehicular and pedestrian safety events involving transit vehicles, implementing safety risk mitigations consistent with 49 CFR 673.25(d)(3) and 673.11(a)(7)(i). The safety risk mitigations identified and recommended by the Safety Committee, based on a safety risk assessment for the safety risk reduction program, are included or incorporated by reference in the Plan, in accordance with 49 CFR 673.11(a)(7)(iv) and 673.25(d)(5).

VI. SAFETY COMMITTEE ESTABLISHMENT, MEMBERSHIP, AND PROCEDURES Clovis Transit has established a Safety Committee through a joint labor-management process that is appropriately scaled to its size, scope, and complexity. The committee serves as a tool to develop and promote a safe, healthy, and secure environment for Clovis Transit employees and passengers.

The Safety Committee consists of an equal number of frontline transit worker representatives and management representatives. To the extent possible, the Safety Committee includes frontline transit worker representatives from major transit service functions across the transit system, such as operations and maintenance.

The labor organization that represents the plurality of Clovis Transit’s frontline transit workers, including employees, contractors, or volunteers working on behalf of the agency—selected the frontline transit worker representatives for the Safety Committee.

Committee members include representatives from the following roles: Management Analysts, Transit Supervisors, Transit Managers, Deputy General Services Directors, Lead Bus Drivers, Bus Drivers, Van Drivers, Dispatchers, Vehicle Washers, Maintenance Managers, Maintenance Lead Workers, and TEBU union representatives.

Organizational Structure, Size, and Composition of the Safety Committee The Safety Committee is structured to ensure equal representation from both management and frontline workers. The committee will be chaired, or co-chaired, by the Chief Safety Officer from management. The size of the committee is balanced to reflect both operational and safety needs, with representatives from all major transit service functions.

Meeting Agendas, Notices, and Minutes
Meeting agendas and notices will be developed by the committee chair and shared with all members at least 48 hours before scheduled meetings. Meeting minutes will be recorded and maintained by a designated committee member or secretary, ensuring that all discussions and decisions are documented in a timely manner and accessible for future reference. The minutes will be distributed to all committee members and made available to employees upon request.

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Training for Safety Committee Members
Committee members will receive required training related to the agency's Plan, including training on the processes, activities, and tools used to support Clovis Transit’s Safety Management System (SMS). This ensures that all members are equipped with the knowledge and skills necessary to participate effectively in safety- related decision-making.

Compensation Policy for Participation
Clovis Transit compensates Safety Committee members for their participation in Safety Committee meetings in accordance with the following terms and conditions:

Employees will be compensated at their regular hourly rate for time spent in Safety Committee meetings, unless they qualify for overtime under the terms of their Memorandum of Understanding (MOU).

This policy ensures that committee members' time and contributions are appropriately recognized and compensated, following applicable guidelines and agreements.

Accessing Technical Experts and Advisory Support
The Safety Committee will have access to technical experts, including other transit workers, who may serve in an advisory capacity as needed to support the committee’s deliberations. These experts may be consulted on specific safety issues and provide additional insight into operational or technical matters.

Access to Information, Resources, and Tools
The Safety Committee will have access to Clovis Transit information, resources, and tools necessary to support its deliberations. This includes data, reports, and other materials relevant to safety concerns and the development of solutions.

Access to Submissions from the Transit Worker Safety Reporting Program The Safety Committee will have access to submissions from the transit worker safety reporting program. This will allow the committee to review incidents, concerns, and suggestions submitted by employees regarding safety issues and use this information to inform their decisions.

Reaching and Recording Decisions
The Safety Committee will reach and record decisions through a majority vote during meetings, with meeting minutes reflecting the outcome of those decisions. All decisions made by the committee will be documented, and the reasoning behind each decision will be included in the minutes.

Coordination and Communication with the Management and Accountable Executive
The Safety Committee will coordinate and communicate regularly with Clovis Transit’s

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Management Team and the Accountable Executive to ensure alignment between safety initiatives and organizational goals. The committee will provide regular updates and recommendations to these entities as part of its ongoing safety efforts.

Managing Disputes
The Safety Committee will implement a process for managing disputes to ensure that operations continue smoothly. If conflicts arise, they will be addressed through a formal dispute resolution process, involving all parties, and ensuring that disagreements are resolved in a manner that allows the committee to carry out its responsibilities without disruption.

Carrying Out Responsibilities
The Safety Committee will carry out its responsibilities as outlined in this policy by following established procedures, collaborating with all relevant stakeholders, and making decisions based on the committee’s collective expertise and available resources. The committee will focus on promoting safety, identifying potential hazards, and recommending corrective actions in alignment with the agency’s safety goals.

The activities and decisions of the committee are documented through meeting agendas and minutes.

VII. SAFETY MANAGEMENT SYSTEM (“SMS”)
Clovis Transit is committed to establishing and implementing an SMS in accordance with 49 CFR 673.21, scaled to the size, scope, and complexity of Clovis Transit. Clovis Transit’s SMS includes the following key components: a Safety Management Policy to outline safety objectives and responsibilities, Safety Risk Management (“SRM”) to identify and mitigate risks, Safety Assurance to monitor and evaluate safety performance, and Safety Promotion to foster a safety culture through training and communication. This system ensures that Clovis Transit meets safety standards, reduces risks, and continuously improves safety practices across all operations.

VIII. SAFETY MANAGEMENT POLICY

Safety is a core value at Clovis Transit, and managing safety is a core business function. Clovis Transit will develop, implement, maintain, and continuously improve processes to ensure the safety of its customers, employees, and the public. Clovis Transit is committed to the following safety objectives:
• Communicating the purpose and benefits of the SMS to all staff, managers, supervisors, and employees.
• Providing a culture of open reporting of all safety concerns, ensuring that no action will be taken against any employee who discloses a safety concern through Clovis Transit’s Employee Safety Reporting Program (ESRP), unless such disclosure indicates, beyond any reasonable doubt, an illegal act, gross negligence, or a deliberate or willful disregard of regulations or procedures.

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• Providing appropriate management involvement and the necessary resources to establish an effective ESRP that will encourage employees to communicate and report any unsafe work conditions, hazards, or at-risk behavior to the management team.
• Identifying hazardous and unsafe work conditions and analyzing data from the ESRP. After thoroughly analyzing the data provided, Clovis Transit’s Management Team will develop processes and procedures to mitigate safety risk to an acceptable level.
• Establishing safety performance targets that are realistic, measurable, and data driven. Continually improving our safety performance through management processes that ensure appropriate safety management action is taken and is effective.

Safety Committee Overview
The Safety Committee is a critical component of Clovis Transit’s approach to safety. The committee is comprised of both management and frontline transit worker representatives, ensuring that safety concerns from both perspectives are considered. It is structured to encourage collaboration and the development of safety solutions across all areas of transit service operations, including maintenance, operations, and management.

Signed

Bethany R. Berube, Deputy General Services Director and Accountable Executive

Safety Management Policy Communication
The Chief Safety Officer, who leads Clovis Transit’s SMS activities, will introduce staff to SMS principles through a series of staff meetings designed to engage all employees. Clovis Transit’s Safety Management Policy Statement will also be distributed to each employee in the form of a handout during these meetings and will be accessible through Clovis Transit’s online employee communication portal. Clovis Transit will also post copies of the Safety Management Policy Statement on bulletin boards in the operations and maintenance break areas. Clovis Transit will incorporate review and distribution of the Safety Management Policy Statement into new-hire training and all-staff annual refresher training.

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Accountable Executive The Deputy General Services Director serves as Clovis Transit’s Accountable Executive with the
following authorities, accountabilities, and
responsibilities under this plan:

• Controls and directs human and capital
resources needed to develop and maintain
the Plan and SMS.
• Designates an adequately trained Chief
Safety Officer who is a direct report.
• Ensures that Clovis Transit’s SMS is
effectively implemented.
• Ensures action is taken to address
substandard performance in Clovis Transit’s
SMS.
• Assumes ultimate responsibility for carrying
out Clovis Transit’s Plan and SMS.
• Maintains responsibility for carrying out the
agency's Transit Asset Management Plan.
• Receives and considers all other safety risk
mitigations recommended by the Safety
Committee.

Chief Safety Officer or Accountable
Executive
The Accountable Executive designates the Transit
Manager of Clovis Transit as the Chief Safety
Officer. The Chief Safety Officer has the following
authorities, accountabilities, and responsibilities
under this plan:

• Develops Clovis Transit’s Plan and SMS
policies and procedures.
• Ensures and oversees day-to-day
implementation and operation of Clovis
Transit’s SMS.
• Manages Clovis Transit’s ESRP.
• Chairs the Clovis Transit Safety Committee
and
o Coordinates the activities of the
committee;
o Establishes and maintains Clovis
Transit’s Safety Risk Register and
Safety Event Log to monitor and
analyze trends in hazards,
occurrences, incidents, and accidents;
and
o Maintains and distributes minutes of
committee meetings.
• Advises the Accountable Executive on SMS

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progress and status.
• Identifies substandard performance in Clovis
Transit's SMS and develops action plans for
approval by the Accountable Executive.
• Ensures Clovis Transit policies are consistent
with Clovis Transit’s safety objectives.
• Provides SRM expertise and support for other
Clovis Transit personnel who conduct and
oversee Safety Assurance activities.

Safety Committee The Safety Committee is a critical component of Clovis Transit’s approach to safety. The committee
is comprised of both management and frontline
transit worker representatives, ensuring that safety
concerns from both perspectives are considered. It
is structured to encourage collaboration and the
development of safety solutions across all areas of
transit service operations, including maintenance,
operations, and management. The Safety
Committee has the following authorities,
accountabilities, and responsibilities under this plan:

• Reviews and approves the Plan and any
updates before approval of City Council
• Set annual safety performance targets for the
safety risk reduction program.
• Identifies and recommends safety risk
mitigations necessary to reduce the likelihood
and severity of potential consequences
identified through the safety risk assessment,
including safety risk mitigations associated
with any instance where Clovis Transit did not
meet an annual safety performance target in
the safety risk reduction program.
• Identifies safety risk mitigations that may be
ineffective, inappropriate, or were not
implemented as intended
• Identifies safety deficiencies for purposes of
continuous improvement, including any
instance where Clovis Transit did not meet an
annual safety performance target in the safety
risk reduction program.

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Agency Leadership and
Management
Agency Leadership and Management also have
authorities and responsibilities for day-to-day SMS
implementation and operation of Clovis Transit’s
SMS under this plan. Clovis Transit Leadership and
Management include:
• Deputy General Services Director
• Transit Manager
• Transit Supervisor
• Lead Bus Driver
• Dispatcher
• Maintenance Manager
• Management Analyst
• Staff Analyst
• Compliance Officer

Clovis Transit Leadership and Management
personnel have the following authorities,
accountabilities, and responsibilities:

• Participate as members of Clovis Transit’s
Safety Committee.
• Complete training on SMS and Clovis
Transit’s Plan elements.
• Oversee day-to-day operations of the SMS in
their departments.
• Modify policies in their departments
consistent with the implementation of the
SMS, as necessary.
• Provide subject matter expertise to support
implementation of the SMS as requested by
the Accountable Executive or the Chief Safety
Officer, including SRM activities, investigation
of safety events, development of safety risk
mitigations, and monitoring of mitigation
effectiveness.

Key Staff and Activities Key Staff are critical to the successful implementation of the Clovis Transit SMS. Key Staff
are employees who directly oversee the operation.

Clovis Transit uses the monthly Drivers’ Meeting and
All Staff Notifications to support its SMS and safety
programs:

• Drivers’ Meetings: A permanent agenda in
all monthly Drivers’ Meetings is dedicated to
safety. Safety issues are discussed and
documented.
• Monthly All-Staff Notifications: Hazard

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reports and mitigations will be shared, safety
topics will be brought up for open discussion,
further feedback solicited, and hazard self-
reporting further encouraged. Information
discussed in these meetings will be
documented.

The ESRP encourages employees who identify safety hazards in their day-to-day duties to report them to senior management in good faith, without concerns of consequences.

The three ways employees can report on safety conditions are:

1. Reporting directly to a dispatcher, who will add them to the daily Operations Log.

2. Reporting by filling out a Clovis Transit Safety Concern/Suggestion Reporting Form using their name or anonymously.

This form can be filled out physically or online and submitted via email to [email protected] or dropped in one of the drop boxes located in the Transit Center located at 785 3rd Street Clovis, CA 93612 or Corp Yard building located at 155 N. Sunnyside Avenue Clovis, CA 93612.

3. Reporting conditions directly to the Chief Safety & Security Officer, any lead bus driver, supervisor, manager, or deputy director.

Examples of information typically reported include:

• Safety concerns in the operating environment (for example, road conditions or the condition of facilities or vehicles);
• Policies and procedures that are not working as intended (for example, insufficient time to complete pre-trip inspection);
• Events that senior managers might not otherwise know about (for example, near misses and assaults on transit workers and unsafe acts and conditions); and • Information about why a safety event occurred (for example, radio communication challenges).

Clovis Transit encourages participation in the ESRP by protecting employees who report safety conditions in good faith. However, Clovis Transit may take disciplinary action if the report involves any of the following:

• Willful participation in illegal activity, such as assault or theft; • Gross negligence, such as knowingly utilizing heavy equipment for purposes other than intended such that people or property are put risk; or • Deliberate or willful disregard of regulations.

IX. SAFETY RISK MANAGEMENT

Clovis Transit uses the SRM process as a primary method to ensure the safety of Clovis Transit operations, passengers, employees, vehicles, and facilities. It is a process whereby hazards and their consequences are identified, assessed for potential safety risk, and resolved in a manner acceptable to Clovis Transit’s leadership. The SRM process allows

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Clovis Transit to carefully examine what could cause harm and determine whether Clovis Transit has taken sufficient precautions to minimize the harm, or if further mitigations are necessary.

The Chief Safety Officer leads Clovis Transit’s SRM process, working with the Safety Committee to identify hazards and consequences, assess safety risk of potential consequences, and mitigate safety risk. The results of Clovis Transit’s SRM process are documented and available for review.

The SRM process applies to all elements of Clovis Transit’s system including operations and maintenance; facilities and vehicles; and personnel recruitment, training, and supervision.

In carrying out the SRM process, Clovis Transit uses the following terms:

• Event – Any accident, incident, or occurrence.
• Hazard – Any real or potential condition that can cause injury, illness, or death; damage to or loss of the facilities, equipment, rolling stock, or infrastructure belonging to Clovis Transit; or damage to the environment. • Risk – Composite of predicted severity and likelihood of the potential effect of a hazard.
• Risk Mitigation – Method(s) to eliminate or reduce the effects of hazards. • Consequence – An effect of a hazard involving injury, illness, death, or damage to Clovis Transit property or the environment.

Safety Hazard Identification
The safety hazard identification process offers Clovis Transit the ability to identify hazards and potential consequences in the operation and maintenance of Clovis Transit’s system.

Hazards can be identified through a variety of sources, including but not limited to:

• ESRP submissions
• Review of vehicle camera footage
• Safety reporting
• Formal and informal observations of the operation
• Scheduled and unannounced inspections
• Internal safety investigations
• Collision and incident reports
• Committee reviews
• Industry data
• Governmental sources including the FTA, Centers for Disease Control and Prevention and state and local health authorities
• Customer and public feedback or complaints
• Concerns identified through its Safety Assurance activities.

When a safety concern is observed by Clovis Transit’s management or supervisory personnel, whatever the source, it is reported to the Chief Safety Officer. Procedures for reporting hazards to the Chief Safety Officer are reviewed during Monthly Staff Meetings and in the Safety Committee. The Chief Safety Officer also receives employee reports from the ESRP,

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Driver Incident Reports, Passenger Comments/Complaints related to safety, and the dispatch daily report out. The Chief Safety Officer reviews these sources for hazards and documents them in the Safety Log.

The Chief Safety Officer may conduct further analyses of hazards and consequences entered into the Safety Log to collect information and identify additional consequences and to inform which hazards should be prioritized for safety risk assessment. In following up on identified hazards, the Chief Safety Officer may:

• Reach out to the reporting party, if available, to gather all known information about the reported hazard;
• Conduct a walkthrough of the affected area, assessing the possible hazardous condition, generating visual documentation (photographs and/or video), and taking any measurements deemed necessary;
• Conduct interviews with employees in the area to gather potentially relevant information on the reported hazard;
• Review any documentation associated with the hazard (records, reports, procedures, inspections, video, technical documents, etc.); • Contact other departments that may have association with or technical knowledge relevant to the reported hazard;
• Review any past reported hazards of a similar nature; and • Evaluate tasks and/or processes associated with the reported hazard.

The Chief Safety Officer will then prepare an agenda to discuss identified hazards and consequences with the Safety Committee during bimonthly meetings. This agenda may include additional background on the hazards and consequences, such as the results of trend analyses, vehicle camera footage, vendor documentation, reports and observations, or information supplied by FTA or other oversight authorities.

Any identified hazard that poses a real and immediate threat to life, property, or the environment must immediately be brought to the attention of the Accountable Executive and addressed through the process (with or without the full Safety Committee) for safety risk assessment and mitigation. This means that if the Chief Safety Officer believes immediate intervention is necessary to preserve life, prevent major property destruction, or avoid harm to the environment that would constitute a violation of Environmental Protection Agency or any State environmental protection standards. Otherwise, the Safety Committee will prioritize hazards for further SRM activity.

Safety Risk Assessment
Clovis Transit assesses the safety risk associated with identified safety hazards using its safety risk assessment process. This includes an assessment of the likelihood and severity of the consequences of hazards, including existing mitigations, and prioritizing hazards based on safety risk.

The Chief Safety Officer and Safety Committee assess prioritized hazards using Clovis Transit’s Safety Risk Matrix. This matrix expresses assessed risk as a combination of one severity category and one likelihood level, also referred to as a hazard rating.

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Likelihood
Description Level Criteria
Frequent A Likely to occur often in the life of an item. Continuously experienced in the fleet/inventory
Probable B Will occur several times in the life of an item, will occur frequently in the fleet
Occasional C Likely to occur sometime in the life of an item. Will occur several times in fleet/inventory
Remote D Unlikely, but possible, to occur in the life of an item.

Unlikely but can reasonably be expected to occur in the fleet/inventory
Improbable E So unlikely, it can be assumed an occurrence may be experienced. Unlikely to occur, but possible in
fleet/inventory
Eliminated F Incapable of occurrence

Severity Categories
Description Level Criteria
Catastrophic 1 Could result in a fatality, permanent disability, or major property damage (exceeding $500,000). Could cause
major service disruption or significant violation of law or environmental regulations.

Critical 2 Could result in serious injury or temporary disability, or significant property damage ($50,000–$500,000).

Could impact service operations or involve a reportable environmental incident.

Marginal 3 Could result in minor injury or property damage ($5,000–$50,000). Limited impact on operations, with
minimal or no regulatory implications.

Negligible 4 Could result in first-aid level injury or minor property damage (less than $5,000). No significant impact on
service or compliance.

Risk Assessment Matrix
Hazard Categories
Likelihood Catastrophic
(1)
Critical (2) Marginal (3) Negligible (4)
(A) Frequent High (A1) High (A2) Medium (A3) Medium (A4) (B) Probable High (B1) High (B2) Medium (B3) Low (B4) (C) Occasional High (C1) High (C2) Medium (C3) Low (C4) (D) Remote Medium (D1) Medium (D2) Low (D3) Low (D4)
(E) Improbable Low (E1) Low (E2) Low (E3) Low (E4)
(F) Eliminated Low (F1) Low (F2) Low (F3) Low (F4)

The Chief Safety Officer schedules safety risk assessment activities on the Safety Committee agenda and prepares a Safety Risk Assessment Packet. This packet is distributed at least one week in advance of the Safety Committee meeting. During the meeting, the Chief

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Safety Officer reviews the hazard and its consequence(s) and reviews available information distributed in the Safety Risk Assessment Packet on severity and likelihood. The Chief Safety Officer may request support from members of the Safety Committee in obtaining additional information to support the safety risk assessment.

Once sufficient information has been obtained, the Chief Safety Officer will document the Safety Committee’s safety risk assessment, including hazard rating and mitigation options for each assessed safety hazard in the Safety Risk Register. The Chief Safety Officer will maintain on file Safety Committee agendas, Safety Risk Assessment Packets, additional information collection, and completed Safety Risk Register sections for a period of three years from the date of generation.

Safety Risk Mitigation
The Accountable Executive, Chief Safety Officer and other key staff will review current methods of safety risk mitigation and establish methods or procedures to mitigate or eliminate safety risks associated with specific hazards based on recommendations from the Safety Committee.

Clovis Transit can reduce safety risk by reducing the likelihood and/or severity of potential consequences of hazards. This includes reducing and mitigating vehicular and pedestrian safety events involving transit vehicles, consistent with 42 CFR 673.25(d)(3), as well as reducing and mitigating assaults on transit workers, in alignment with 42 CFR 673.25(d)(4).

Clovis Transit also addresses safety risks related to vehicle operator fatigue through scheduling practices and monitoring to minimize fatigue-related incidents. Clovis Transit will consider guidance provided by an oversight authority, FTA, CDC and other State health authorities to mitigate or eliminate safety risks.

When identifying safety risk mitigations under the Safety Risk Reduction Program related to both vehicular and pedestrian safety events and assaults on transit workers—including in response to a missed safety performance target established by the Safety Committee—Clovis Transit and its Safety Committee consider a range of targeted strategies including but not limited to:

• For incidents involving vehicular and pedestrian safety, the agency evaluates mitigations aimed at reducing visibility impairments for transit vehicle operators. These may include retrofits to vehicles currently in revenue service and incorporating improved visibility specifications into future vehicle procurements, with the goal of minimizing operator blind spots and reducing accident risk.

• For assaults on transit workers, Clovis Transit and the Safety Committee assess the potential deployment of mitigation infrastructure and technology on transit vehicles and within transit facilities. This includes installing barriers to prevent the unauthorized entry of individuals or objects into bus operator workstations, thereby enhancing operator safety and deterring physical assaults.

Clovis Transit will include or incorporate by reference in the Plan the safety risk mitigations identified and recommended by the Safety Committee based on a safety risk assessment, as part of the safety risk reduction program. This includes mitigations related to vehicular and pedestrian safety events involving transit vehicles or assaults on transit workers, as required

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by 42 CFR 673.11(a)(7)(iv) and 673.25(d)(5).
*d
Prioritization of safety risk mitigations is based on the results of safety risk assessments. The Chief Safety Officer tracks and updates safety risk mitigation information in the Safety Risk Register and makes the Register available to the Safety Committee during bimonthly meetings and to Clovis Transit staff upon request. Clovis maintains mechanisms for frontline employees to report hazards and unsafe conditions without fear of retaliation, reinforcing a positive safety culture and supporting continuous safety improvement.

Safety Risk Priority Criteria
Priority #1 (A1, B1, C1,
A2, B2, or C2)
Unacceptable – Action Required
Safety risk must be immediately mitigated or eliminated

Priority #2 (D1, D2, A3,
B3, C3, or A4)
Undesirable – Management Decision:

Executive Management must decide whether to accept
safety risk with monitoring or require additional controls

Priority #3 (E1, F1, E2,
F2, D3, E3, F3, B4, C4,
D4, E4, or F4)
Acceptable with review
Safety risk is acceptable pending management review

In the Safety Risk Register, Chief Safety Officer will also document any specific measures or activities, such as reviews, observations, or audits, that will be conducted to monitor the effectiveness of mitigations once implemented.

When the Safety Committee recommends a safety risk mitigation unrelated to the safety risk reduction program and the Accountable Executive decides not to implement the safety risk mitigation, the Accountable Executive will prepare a written statement explaining their decision.

This statement will be submitted and presented to the Clovis Transit’s Safety Committee and City Council in accordance with 42 CFR 673.25(d)(6).

Activities to monitor the system for compliance with and sufficiency of Clovis Transit’s procedures for operations and maintenance will be conducted in accordance with 42 CFR 673.27(b)(1).

Additionally, activities will be undertaken to monitor Clovis Transit’s operations to identify any safety risk mitigations that may be ineffective, inappropriate, or were not implemented as intended, as specified in 42 CFR 673.27(b)(2).

X. SAFETY ASSURANCE

Through its Safety Assurance process, Clovis Transit:

1. Evaluates its compliance with operations and maintenance procedures to determine whether existing rules and procedures are sufficient to control the safety risk;

2. Assesses the effectiveness of safety risk mitigations to make sure the mitigations are appropriate and are implemented as intended;

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3. Investigates safety events to identify causal factors; and

4. Analyzes information from safety reporting, including data about safety failures, defects, or conditions.

5. The Safety Committee will also play an active role in monitoring the effectiveness of safety risk mitigations, as outlined in §§ 673.19(d)(3)(ii) and 673.27(b)(2).

XI. MANAGEMENT OF CHANGE

Safety Performance Monitoring and Measurement
Clovis Transit has many processes in place to monitor its entire transit system for compliance with operations and maintenance procedures, including:

• Safety audits,
• Informal inspections,
• Regular review of onboard camera footage to assess drivers and specific incidents, • Safety surveys,
o ESRP,
o Investigation of safety occurrences,
o Safety review prior to the launch or modification of any facet of service, o Daily data gathering and monitoring of data related to the delivery of service, and
o Regular vehicle inspections and preventative maintenance.

Results from the above processes are compared against recent performance trends quarterly and annually by the Chief Safety Officer to determine where action needs to be taken. The Chief Safety Officer enters any identified non-compliant or ineffective activities, including mitigations, back into the SRM process for reevaluation by the Safety Committee. Strategies for assessing safety performance and the effectiveness of activities include, but are not limited to the following:

1. Identifying deficiencies in Clovis Transit’s SMS and deficiencies in Clovis Transit’s performance against its safety performance targets required under 49 CFR 673.11(a)(7).

2. Monitoring safety performance against annual safety performance targets set by the Safety Committee under for the safety risk reduction program in.

3. If Clovis Transit does not meet an established annual safety performance set by the Safety Committee for the safety risk reduction program, Clovis Transit must:
a. Assess associated safety risks through its safety risk assessment process. b. Mitigate the associated safety risk based on the results of a safety risk assessment using its safety risk mitigation process. The mitigation are then included or incorporated by reference in this Plan.
c. Clovis Transit allocates its safety set-aside in the following fiscal year to safety- related projects eligible under 49 U.S.C. 5307 that are reasonably likely to help it meet missed safety performance target(s) for the safety risk reduction

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program in the future.

Clovis Transit monitors safety risk mitigations to determine if they have been implemented and are effective, appropriate, and working as intended. The Chief Safety Officer maintains a list of safety risk mitigations in the Safety Risk Register. The mechanism for monitoring safety risk mitigations varies depending on the mitigation.

The Chief Safety Officer establishes one or more mechanisms for monitoring safety risk mitigations as part of the mitigation implementation process and assigns monitoring activities to the appropriate director, manager, or supervisor. These monitoring mechanisms may include tracking a specific metric on daily, weekly, or monthly logs or reports; conducting job performance observations; or other activities. The Chief Safety Officer will endeavor to make use of existing Clovis Transit processes and activities before assigning new information collection activities.

The Chief Safety Officer and Safety Committee review the performance of individual safety risk mitigations during bimonthly Safety Committee meetings, based on the reporting schedule determined for each mitigation, and determine if a specific safety risk mitigation is not implemented or performing as intended. If the mitigation is not implemented or performing as intended, the Safety Committee will propose a course of action to modify the mitigation or take other action to manage the safety risk. The Chief Safety Officer will approve or modify this proposed course of action and oversee its execution.

The Chief Safety Officer and Safety Committee also monitor Clovis Transit’s operations on a large scale to identify mitigations that may be ineffective, inappropriate, or not implemented as intended by:

• Reviewing results from accident, incident, and occurrence investigations; • • Monitoring employee safety reporting;
• Reviewing results of internal safety audits and inspections; and • Analyzing operational and safety data to identify emerging safety concerns.

The Chief Safety Officer works with the Safety Committee and Accountable Executive to carry out and document all monitoring activities.

The Chief Safety Officer and Safety Committee routinely review safety data captured in employee safety reports, safety meeting minutes, customer complaints, and other safety communication channels. When necessary, the Chief Safety Officer and Safety Committee ensure that the concerns are investigated or analyzed through Clovis Transit’s SRM process.

The Chief Safety Officer and Safety Committee also review internal and external reviews, including audits and assessments, with findings concerning Clovis Transit’s safety performance, compliance with operations and maintenance procedures, or the effectiveness of safety risk mitigations.

XII. SAFETY PROMOTION

Competencies and Training
The comprehensive safety training program applies to all Clovis Transit employees directly

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responsible for safety, including, but not limited to:

• Bus vehicle operators (drivers),
• Dispatchers,
• Van Drivers,
• General office staff,
• Maintenance technicians
• Managers and supervisors,
• Agency Leadership and Executive Management,
• Chief Safety Officer, and
• Accountable Executive

Clovis Transit dedicates resources to conduct a comprehensive safety training program, as well as training on the SMS roles and responsibilities. The scope of the safety training, including annual refresher training, is appropriate to each employee’s individual safety- related job responsibilities and his or her role in the SMS.

Basic training requirements for Clovis Transit employees, including frequencies and refresher training, are documented in the Safety Training Matrix and the Employee Handbook. The training program will include de-escalation training and safety concern identification and reporting training.

Operations safety-related skill training includes the following:

• New-hire bus vehicle operator classroom and hands-on skill training, • Bus vehicle operator refresher training,
• Bus vehicle operator retraining (recertification or return to work), • Classroom and on-the-job training for dispatchers,
• Classroom and on-the-job training for operations supervisors and managers, and • Accident investigation training for operations supervisors and managers.

Vehicle maintenance safety-related skill training includes the following:

• Ongoing vehicle maintenance technician skill training, • Ongoing skill training for vehicle maintenance supervisors, • Accident investigation training for vehicle maintenance supervisors, • Ongoing hazardous material training for vehicle maintenance technicians and supervisors, and
• Training provided by vendors.

Safety Communication
The Chief Safety and Administrative Manager coordinate safety communication activities for the SMS. Clovis Transit activities focus on the three categories of communication activity established in 49 CFR Part 673:

A. Communicating safety and safety performance information throughout the agency: Clovis Transit communicates information on safety and safety performance in its monthly newsletter and during staff meetings. Clovis Transit also has a permanent agenda item on all Safety Committee Meetings dedicated to safety.

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Information typically conveyed during these meetings includes safety performance statistics, lessons learned from recent occurrences, upcoming events that may impact Clovis Transit service or safety performance, and updates regarding SMS implementation. Clovis Transit also requests information from drivers during these meetings, which is recorded in meeting minutes. Finally, the Administrative Division posts safety bulletins and flyers on the bulletin boards located in all bus operator and maintenance break rooms, advertising safety messages and promoting awareness of safety issues.

B. Communicating information on hazards and safety risks relevant to employees' roles and responsibilities throughout the agency: As part of new-hire training, Clovis Transit distributes safety policies and procedures, included in the Employee Handbook, to all employees. Clovis Transit provides training on these policies and procedures and discusses them during safety talks between supervisors and bus operators and vehicle technicians. For newly-emerging issues or safety events at the agency, the Chief Safety & Security Officer issues bulletins or messages to employees that are reinforced by supervisors in one-on-one or group discussions with employees.

C. Informing employees of safety actions taken in response to reports submitted through the ESRP and Safety Committee Activities: Clovis Transit provides targeted communications to inform employees of safety actions taken in response to reports submitted through the ESRP, including announcements, messages, safety talks, trainings, and one-on-one discussions between employees and supervisors.

XIII. ADDITIONAL INFORMATION

Supporting Documentation
Clovis Transit will maintain documentation related to the implementation of its SMS; the programs, policies, and procedures used to carry out this Plan; and the results from its SMS processes and activities for three years after creation. They will be available to the FTA or other Federal or oversight entity upon request.

Report to the City Council

To: City Council
From: General Services Department
Date: June 15, 2026
Staff: Amy Hance, General Services Director
Subject: General Services - Approval - Res. 26-____, Approving a Side Letter Agreement with the Clovis Public Safety Employees Association (CPSEA) to Establish a Modified Salary Structure Methodology.

Recommendation: Approve
Attachments:

1. CPSEA Side Letter Agreement Salary Structure ATT 1 Res. 26-___

Recommendation:

For the City Council to approve a resolution approving a side letter agreement with the Clovis Public Safety Employees Association (CPSEA) to establish a modified salary structure methodology.

Executive Summary:

In 2025, the City conducted a comprehensive salary structure analysis to determine the current position structure, internal relationships inside departments, and share position relationships between different departments. The goal was to support standardization of the structure to enhance succession planning and employee retention. The City has identified Lead Community Services Officer as a position represented by CPSEA in need of salary adjustment. The position of Lead Community Services Officer will receive a base salary increase of 0.70%. In addition, the City has established a salary structure for all positions represented in the bargaining unit.

Background:

In 2025, the City conducted a comprehensive salary structure analysis to determine the current position, structure, internal relationships inside departments, and shared position relationships between different departments. This analysis revealed a wide disparity between classification series, also known as job families.

To provide consistent structure throughout the organization, staff developed a general structure standard using a strategy known as benchmarking, which is simply identifying position within a classification series that has been proven to be consistently compared to similar positions in comparison cities during Clovis' triennial salary survey. Once a position has been designated as a benchmark, other positions within the same job family are assigned a goal percentage difference in

salary. This difference in salary can be above the benchmark position, or it may be below the benchmark position, depending on the structure of the job family. The position also may be set to be the same as a similar position with similar duties in another department or bargaining unit.

There are several advantages to the benchmark strategy, including consistency across roles and departments, along with budget control and predictability. Additionally, this change will allow a higher degree of workforce planning, which is paramount as roles within the City continue to change, and additional jobs are added. And finally, and most importantly, salary transparency builds trust with employees.

Fiscal Impact:

The cost associated with the Side Letter Agreement for FY 2026-2027 is approximately $2,700.

Sufficient funding is available within the current Police Department budget to cover these costs.

Reason for Recommendation:

A resolution by the City Council is required to authorize the execution of a Side Letter Agreement between the City and CPSEA.

Actions Following Approval:

The Side Letter Agreement between the City and CPSEA will be executed.

Conflict of Interest:

None.

RESOLUTION 26-

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CLOVIS

APPROVING A SIDE LETTER AGREEMENT WITH THE CLOVIS PUBLIC

SAFETY EMPLOYEES ASSOCIATION (CPSEA)

WHEREAS, the City conducted a comprehensive salary structure analysis to determine the current position structure; and

WHEREAS, goal was to support standardization of the structure to enhance succession planning and employee retention; and

WHEREAS, the City has established a salary structure for all positions represented in CPSEA; and

WHEREAS, one position represented by CPSEA has been identified as in need of salary adjustment which is Lead Community Service Officer with a base salary increase of

0.70%; and

WHEREAS, CPSEA and the City representatives met and conferred on the side letter and are in agreement.

NOW, THEREFORE, BE IT RESOLVED, that the City of Clovis approves the Side Letter Agreement with CPSEA (Attachment A) and authorizes the City Manager to sign the agreement.

* * * * * *

The foregoing Resolution was introduced and adopted at a regular meeting of the City Council of the City of Clovis held on June 15, 2026, by the following vote to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

DATED: June 15, 2026

___________________________ __________________________ Mayor City Clerk

ATTACHMENT 1

Side Letter Agreement to the 2025-2028 Memorandum of
Understanding Between the City of Clovis and the
Clovis Public Safety Employees Association (CPSEA)

The City of Clovis (“The City”) and CPSEA mutually agree to this Side Letter Agreement.

This Side Letter Agreement will be incorporated into the Memorandum of Understanding between the City of Clovis and CPSEA (“MOU”). Except as amended herein, each and every term and condition of the MOU shall remain in full force and effect.

The City has conducted a salary structure analysis of all job classifications throughout the city, including those located within the bargaining unit represented by CPSEA. The City has identified the Lead Community Service Officer job description as a position represented by the CPSEA in need of salary adjustment. The position of Lead Community Service Officer will receive a base salary increase of 0.7%. The new salary schedule is found in the updated “CPSEA – Monthly Salary Schedule – Effective July 1, 2026”, which is attached to this document as Exhibit A.

In addition, CPSEA agrees to the adoption of the salary structure for all positions represented in the bargaining unit as found in Exhibit B, attached.

This Side Letter Agreement will become effective July 1, 2026, when approved by the City Council and fully executed by the parties.

For the CITY: For the ASSOCIATION:

___________________________ _____________________________ Andrew Haussler, City Manager Ty Wood, CPSEA President

___________________________ _____________________________ Scott G. Cross, City Attorney Shawn Knapp, CFFA Vice President

ATTEST: ________________________
Briana Parra, City Clerk

ATTACHMENT A

EXHIBIT A

CITY OF CLOVIS
CPSEA Salary Structure Modification - Effective July 1, 2026 Code Position
Step
1 Step
2 Step
3 Step
4 Step
5 5655 Lead Community Services Officer 6,529 6,855 7,198 7,558 7,936

EXHIBIT B

Position Title Position Relationship
Senior Animal Control Officer 10% Above Animal Control Officer Animal Control Officer Benchmark
Animal Services Aide Same as Custodian
Lead Public Safety Dispatcher 10% Above Public Safety Dispatcher Public Safety Dispatcher Benchmark
Digital Forensic Analyst 15% Above Crime Specialist
Crime Specialist Benchmark
Real Time Analyst Same as Public Safety Dispatcher
Senior Systems Video Technician
10% Below Information Technology
Analyst
Systems Video Technician
Same as Information Technology
Technician
Senior Police Records Specialist 15% Above Police Records Specialist II Police Records Specialist II Benchmark
Police Records Specialist I 10% Below Police Records Specialist II Police Services Officer Same as Public Safety Dispatcher Senior Property/Evidence Technician
10% Above Property and Evidence
Technician
Property and Evidence Technician Benchmark
Lead Community Services Officer

12.5% Above Community Services
Officer
Community Services Officer Benchmark
Fire Inspector I 10% Below Fire Inspector II

Fire Inspector II Benchmark

Report to the City Council

To: City Council
From: Police Department
Date: June 15, 2026
Staff: Dave Roseno, Police Lieutenant
Subject: Police - Approval - Amendment to the Police Department Military Equipment List Pursuant to Policy 706.

Recommendation: Approve
Attachments:

1. Military Equipment Amendment ATT 1 - Policy 706

Recommendation:

For the City Council to approve the following amendments to the Police Department’s Military Equipment list:

1. Defense Technology, 40MM Single Shot Launcher: Quantity changed from 2 to 18

2. Remington 870 Less Lethal Shotgun: Quantity change from 20 to 0 (phased out over time)

3. Unmanned Aircraft Systems (UAS): Addition of 3 DJI Mattrice 4T and 3 DJI Avata 360 drones

Executive Summary:

The Police Department has researched and assessed recent training updates, practices, and liability related to the use of less lethal shotguns. As a result, staff recommends the expanded use of the 40mm single shot launcher as the primary less lethal impact device and the phasing out of the less lethal shotguns currently deployed.

The Police Department is also committed to providing adequate Unmanned Aircraft System (UAS) coverage for the patrol environment. While attempting to purchase additional DJI Mavic 3T and DJI Avata 2 systems (already on the current Military Equipment List), staff was advised by vendors to acquire the latest version for warranty and longevity. The latest versions are the DJI Mattrice 4T and DJI Avata 360.

Background:

The proposed 40mm less-lethal system provides several advantages over the department’s current 12-gauge beanbag platform. The 40mm eXact iMpact Sponge Round can be safely deployed from as close as 5 feet, compared to the 20-foot minimum standoff distance required for the current round. It

also has a significantly greater effective range, allowing officers to maintain a safer distance from potentially dangerous situations while reducing risks to officers, subjects, and bystanders. These improvements can also help reduce departmental liability by providing officers with a safer and more effective less-lethal option.

The 40mm system offers improved accuracy and consistency through the use of rifled launchers, modern optics, and spin-stabilized munitions. These features provide more predictable performance and better shot placement, increasing the likelihood of successful impacts within approved less-lethal target areas. By improving accuracy and reducing the chance of unintended injuries, the system helps enhance public safety and further reduces potential liability for the department.

Staff also recommends expanding the department’s Unmanned Aircraft Systems (UAS) program through the purchase of three DJI Matrice 4T drones and three DJI Avata drones. As existing aircraft age, replacement and expansion are necessary to maintain safe and reliable operations. These additions will enhance officer safety, improve operational capabilities, and help ensure the department can continue providing effective service to the community while remaining fiscally responsible.

Fiscal Impact:

All direct and associated costs related to the above change in inventory are included in the Police Department's budget and are within City of Clovis guidelines for purchase.

Reason for Recommendation:

Approval will allow the Department to increase officer and public safety while reducing the potential for liability.

Actions Following Approval:

The Police Department will research and purchase the above quantity of items and amend the Military Equipment Equipment List to reflect the changes.

Conflict of Interest:

None.

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ATTACHMENT 1

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Report to the City Council

To: City Council
From: Police Department
Date: June 15, 2026
Staff: Jared Binford, Lieutenant
Subject: Police - Approval - Authorize the City Manager to enter into an agreement with Clovis Industrial Park, Inc., for the lease of 272 N. Minnewawa Ave., for approximately $138,000 per year.

Recommendation: Approve
Attachments:

1. Storage Facility Lease Agreement ATT 1 - Lease Agreement

Recommendation:

For the City Council to authorize the City Manager to enter into an agreement with Clovis Industrial Park, Inc., for the lease of 272 N. Minnewawa Ave.

Executive Summary:

With recent growth in the City and at the Police Department, parking has reached capacity. While exploring options to mitigate our parking issues, staff identified a newly constructed indoor warehouse that would allow all police specialty vehicles and trailers to be stored at one location, in close proximity to the Police Department Headquarters. Moving these vehicles would allow their former parking location to be reconfigured to accommodate additional parking within the Police Department's secured area as we continue to grow with Measure Y.

The warehouse also includes office and storage space, which would allow for expansion of the City's camera technicians' office space to accommodate the additional growth throughout the City.

Background:

In the early 2000’s, the Police Department Headquarters was constructed to include secure parking for City-owned and employee vehicles. At that time, the Police Department only had very few specialty vehicles with ample parking for these vehicles. Since then, the department has grown substantially, including the size of the fleet.

Leasing this space would allow for secure parking and storage of specialty vehicles, while still keeping them in close proximity to the Police Department Headquarters for rapid deployment if needed. Relocating these vehicles to the leased site will free up valuable space at the Police

Department Headquarters, helping to alleviate parking constraints for employees’ personal vehicles and providing additional capacity for other department fleet vehicles.

The facility also includes office and storage space that will be utilized by the City's camera technicians. The City’s camera network has expanded considerably in recent years and continues to grow as new public safety and municipal technology projects are implemented. This growth has increased the need for a larger dedicated workspace, and secure storage for cameras and equipment. The additional office and storage space will allow the camera technicians to operate more efficiently, and will improve organization of equipment.

A competitive lease has been negotiated for the entire building for a five-year term, with options to extend for up to an additional five years. Staff is recommending that Council authorize the City Manager to enter into the lease agreement for this building and to sign any amendments to the agreement following completion of the lessor’s improvements for the office space and warehouse storage at 272 N. Minnewawa Ave., Clovis, CA.

Fiscal Impact:

The cost to lease this facility for vehicle storage and office space is approximately $138,000 per year, plus an annual increase of 2.5% starting upon completion of the building, expected in August 2026.

Reason for Recommendation:

The new leased building will provide the Police Department with indoor storage for all larger specialty vehicles and office space for our City's camera technicians. Moving the larger vehicles will allow for additional parking in the Police Department Headquarters parking lot, which is currently at maximum capacity.

Actions Following Approval:

The lease agreement with Clovis Industrial Park, Inc., will be executed, and staff and vehicles will be moved upon completion of the building, expected in August 2026.

Conflict of Interest:

None.

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1. BasicProvisions ("BasicProvisions").

1.1 ParƟes. This Lease("Lease"), datedforreference purposesonly May 31, 2026 ,ismade byand between Clovis Industrial Park, Inc. ("Lessor")and City of Clovis ("Lessee"), (collecƟvelythe"ParƟes," orindividually a"Party").

1.2 Premises: That certainreal property,includingall improvementstherein ortobe providedby Lessorunderthe termsof thisLease, commonlyknownas (streetaddress, city,state, zip): 272 N. Minnewawa Ave., Clovis, CA, 93612 ("Premises"). ThePremises arelocatedin theCounty of Fresno ,and aregenerallydescribed as(describe brieflythe natureofthe propertyand ,ifapplicable, the"Project," iftheproperty islocated withina Project): approx. 9,900 square foot industrial building on an approx. .708 acre lot with approx. 2,068 square feet of improved reception, office and restroom space, the balance of 7,832 square feet being improved warehouse space as shown on Exhibit A, part of the Clovis Industrial Park . (See alsoParagraph 2)

1.3 Term: Five (5) yearsand ]zero (0) months("Original Term")commencing (TBD) ("Commencement Date")andending five (5) years later ("ExpiraƟonDate"). (See alsoParagraph3)

1.4 Early Possession: Ifthe Premisesareavailable Lesseemay havenon-exclusivepossession ofthe Premisescommencing upon full execution of lease and proof of Lessee's required insurance ("EarlyPossession Date"). (SeealsoParagraphs 3.2 and3.3)

1.5 Base Rent: $11,385.00 per month("BaseRent"), payableon the first day ofeach monthcommencing upon Lease commencement . (See alsoParagraph 4)
Ifthis boxis checked,thereare provisionsin thisLease fortheBase Rentto beadjusted. SeeParagraph 51 .

1.6 Base Rentand OtherMonies PaidUpon ExecuƟon:
annual and 5-year fire system inspections ($49), and HVAC maintenance ($54). .

1.7 Agreed Use: Police Dept. equipment storage and office support operations . (SeealsoParagraph 6)

1.8 Insuring Party. Lessoris the"InsuringParty". The annual"BasePremium" is TBD . (See alsoParagraph8)

1.9 Real EstateBrokers. (See alsoParagraph15 and25)
agency relaƟonships inthis Leasewiththe followingreal estatebrokers("Broker(s)")and/ortheir agents("Agent(s)"):

Lessor'sBrokerage Firm David S Siegel & Co., Inc. License No. 01391246 Isthe brokerof(check one): theLessor;or boththe Lesseeand Lessor(dualagent).

Lessor'sAgent Douglas M. Holton LicenseNo. 00966937 is(check one): theLessor'sAgent (salespersonor brokerassociate);or boththe Lessee'sAgent andtheLessor's Agent(dual agent).

Lessee'sBrokerage Firm n/a License No. n/a Isthe brokerof(check one): theLessee;or both theLessee andLessor(dual agent).

Lessee'sAgent n/a LicenseNo. is (checkone): theLessee's Agent(salesperson orbrokerassociate); or boththe Lessee's Agentand theLessor's Agent(dualagent).
separate wriƩen agreement(or ifthereis nosuch agreement,the sumof or % ofthetotal BaseRent) forthe brokerageservicesrendered bythe Brokers.

1.10 Guarantor. The obligaƟons ofthe Lesseeunderthis Leaseare tobeguaranteed by n/a ("Guarantor"). (SeealsoParagraph 37)

1.11 AƩachments. AƩachedhereto arethe following,allof which consƟtute apartof thisLease:
anAddendum consisƟngof Paragraphs through ;
aplot plan depicƟng thePremises,ExhibitA;
acurrent setof theRulesand RegulaƟons;
aWork LeƩer;
other(specify): .

STANDARDINDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE-GROSS (DONOTUSE THISFORMFORMULTI-TENANT BUILDINGS)
(a) Base Rent: $11,385.00 for theperiod month one of the Lease . (b) SecurityDeposit: n/a ("SecurityDeposit"). (Seealso Paragraph5) (c) AssociaƟonFees: n/a forthe period .
(d) Other: $138.00 for one month's estimates of - fire system alarm monitoring ($35), (e) TotalDueUpon ExecuƟon ofthis Lease: $11,523.00 .
(a) RepresentaƟon: Each Partyacknowledgesreceiving aDisclosure RegardingReal EstateAgencyRelaƟonship, confirmsand consentstothe following (b) Paymentto Brokers. Upon execuƟonand deliveryof thisLeaseby both ParƟes, Lessorshall paytothe Brokersthe brokeragefeeagreed toin a ATTACHMENT 1

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2. Premises.

2.1 Leƫng. Lessor herebyleases toLessee,and Lesseehereby leasesfromLessor,thePremises, fortheterm, atthe rental,and uponallof theterms, covenantsand condiƟonsset forthinthis Lease. Whilethe approximatesquarefootageofthe Premisesmayhave beenused inthe markeƟng ofthe Premisesfor purposesof comparison,the BaseRentstated hereinis NOT Ɵed tosquarefootageandis notsubjectto adjustmentshould theactualsize bedetermined tobe different. NOTE: Lesseeisadvised toverify theactual sizepriorto execuƟngthis Lease.

2.2 CondiƟon. Lessor shalldeliver thePremisesto Lesseebroom cleanandfree ofdebris ontheCommencement Dateor theEarly PossessionDate,whichever firstoccurs ("StartDate"), and,solong asthe requiredservice contractsdescribedin Paragraph7.1(b) belowareobtained byLessee andin effect withinthirty days followingthe StartDate, warrantsthatthe exisƟngelectrical, plumbing, fire sprinkler, lighƟng, heaƟng, venƟlaƟngand air condiƟoningsystems ("HVAC"),loading doors,sump pumps,if any,andall othersuch elementsin thePremises,other thanthose constructedbyLessee, shallbe ingood operaƟng condiƟonon saiddate, thatthe surfaceand structuralelementsof theroof,bearingwalls and foundaƟonof anybuildings onthePremises (the"Building") shallbefree ofmaterial defects, andthat theUnit doesnotcontain hazardouslevels ofany moldorfungi definedas toxicunderapplicable stateor federallaw. Ifa non-compliancewith saidwarranty existsas ofthe StartDate,or ifone ofsuch systemsorelements should malfuncƟon orfailwithin theappropriate warrantyperiod,Lessor shall,as Lessor'ssole obligaƟonwith respectto such maƩer,except asotherwise providedin thisLease,promptly aŌerreceipt of wriƩen noƟce fromLessee seƫngforthwith specificity thenature andextent ofsuchnon-compliance, malfuncƟonor failure, recƟfy sameatLessor's expense. Thewarrantyperiods shallbe asfollows:(i) 6months asto theHVACsystems,and (ii)30days asto theremaining systemsandother elementsof theBuilding. IfLessee doesnotgive Lessorthe required noƟce withinthe appropriatewarranty period, correcƟon ofanysuch non-compliance, malfuncƟon orfailure shallbethe obligaƟonof LesseeatLessee's solecost andexpense,except forthe roof, foundaƟons, andbearingwalls whichare handledas providedinparagraph 7. Lessoralsowarrants, thatunless otherwise specifiedin wriƟng,Lessor is unawareof (i)any recorded NoƟcesof Default affecƟng thePremise; (ii)anydelinquent amountsdue underanyloan securedby thePremises;and (iii)any bankruptcy proceeding affecƟng thePremises.

2.3 Compliance. Lessor warrantsthat tothebest ofits knowledgetheimprovements onthe Premisescomplywith thebuilding codes,applicable laws, covenantsor restricƟonsof record, regulaƟons,and ordinances("Applicable Requirements")that werein effect atthe Ɵmethateach improvement,or porƟon thereof,was constructed. Saidwarrantydoes notapply tothe usetowhich Lesseewill putthePremises, modificaƟonswhich mayberequired bythe Americanswith DisabiliƟesAct orany similarlawsas aresult ofLessee's use(seeParagraph50),or toanyAlteraƟons or UƟlity InstallaƟons(as defined inParagraph7.3(a))made orto bemade byLessee. NOTE:Lessee isresponsible fordetermining whetherornot theApplicable Requirements,andespecially thezoning, areappropriatefor Lessee'sintended use,and acknowledgesthatpast usesof thePremises maynolonger beallowed. Ifthe Premisesdo notcomplywith saidwarranty,Lessorshall, exceptas otherwiseprovided, promptly aŌerreceipt of wriƩen noƟcefrom Lessee seƫngforth with specificity thenatureand extentof suchnon-compliance, recƟfy thesame atLessor's expense. If Lesseedoes notgive Lessor wriƩen noƟce ofa non-compliancewiththis warrantywithin 6monthsfollowing theStart Date, correcƟonof thatnon-compliance shallbethe obligaƟonof Lesseeat Lessee'ssolecost andexpense. Ifthe ApplicableRequirements are hereaŌerchanged soas to requireduring theterm ofthisLease the construcƟon ofan addiƟontoor an alteraƟon ofthePremises and/orBuilding, the remediaƟonof anyHazardous Substance, orthe reinforcementor otherphysical modificaƟon ofthe Unit,Premises and/orBuilding("Capital Expenditure"),Lessor andLesseeshall allocatethe costofsuch workas follows:
(a) Subject toParagraph 2.3(c)below,if suchCapital Expenditures are requiredasa resultof the specificand uniqueuse ofthePremises byLessee as comparedwith usesby tenantsingeneral, Lesseeshall befully responsibleforthe costthereof,provided,however,that ifsuch CapitalExpenditureis requiredduring thelast 2years ofthisLease andthe costthereof exceeds6months' BaseRent, Lesseemayinstead terminatethis LeaseunlessLessor noƟfiesLessee, in wriƟng, within10 days aŌer receiptofLessee's terminaƟon noƟce thatLessor haselectedto paythe differencebetweenthe actualcost thereofandan amountequal to6 months'Base Rent. IfLesseeelects terminaƟon,Lessee shallimmediately ceasetheuse ofthe Premiseswhichrequires suchCapital Expenditureanddeliver toLessor wriƩen noƟce specifying a terminaƟondateat least90 days thereaŌer .Such terminaƟon dateshall, however,inno eventbe earlierthanthe lastday thatLessee couldlegally uƟlizethe Premiseswithoutcommencing suchCapital Expenditure. (b) Ifsuch CapitalExpenditure isnotthe resultof the specificand uniqueuse ofthe PremisesbyLessee (suchas, governmentallymandatedseismic modificaƟons),then Lessorshall payforsuch CapitalExpenditure andLessee shallonlybe obligatedto pay,eachmonth duringthe remainderofthe termof thisLease orany extensionthereof,onthedate thaton whichthe BaseRentis due,an amountequalto 1/144thof the porƟonof suchcosts reasonably aƩributable tothe Premises. Lesseeshall payIntereston thebalance butmay prepayits obligaƟon atany Ɵme. If,however,such CapitalExpenditureis requiredduring thelast 2years ofthis Leaseor ifLessorreasonably determinesthat itis noteconomicallyfeasible topay itssharethereof, Lessorshall havethe opƟon toterminate thisLease upon 90days prior wriƩen noƟcetoLessee unlessLessee noƟfiesLessor,in wriƟng,within 10days aŌerreceiptof Lessor's terminaƟon noƟcethatLessee willpay forsuch CapitalExpenditure. If Lessordoesnot electto terminate,and failstotender itsshare ofanysuch CapitalExpenditure, Lesseemayadvance suchfunds anddeduct same,with Interest,from Rent unƟlLessor's shareof suchcosts havebeenfully paid. IfLesseeis unableto financeLessor'sshare, orif thebalance oftheRent due andpayable forthe remainderofthis Leaseis not sufficient tofullyreimburse Lesseeon an offsetbasis, Lesseeshall havetheright toterminate thisLease upon30 days wriƩen noƟceto Lessor.
(c) Notwithstandingthe above,the provisionsconcerningCapital Expendituresare intendedto applyonlyto non-voluntary,unexpected, andnew ApplicableRequirements. If theCapitalExpenditures areinstead triggeredby Lesseeasa resultof anactualor proposedchange inuse,change inintensity ofuse, or modificaƟonto thePremises then,andin thatevent, Lesseeshall either:(i)immediately ceasesuch changeduseor intensityof useand/ortakesuchother stepsas maybe necessaryto eliminatetherequirement forsuch CapitalExpenditure, or(ii)complete suchCapital Expenditureatits ownexpense. Lesseeshall not,however, haveany rightto terminatethisLease.

2.4 Acknowledgements. Lessee acknowledgesthat: (a)it hasbeen givenanopportunity toinspect andmeasurethe Premises,(b) ithas beenadvisedby Lessorand/or Brokersto saƟsfyitselfwith respectto thesize and condiƟonof thePremises (includingbutnot limitedto theelectrical,HVAC and fire sprinkler systems,security,environmental aspects,andcompliance withApplicable Requirementsand theAmericanswith DisabiliƟesAct), andtheirsuitability forLessee's intendeduse, (c)Lessee hasmadesuch invesƟgaƟonas itdeems necessarywithreference tosuch maƩersandassumes allresponsibility thereforasthe samerelate toits occupancyof thePremises,(d) itis notrelying onany representaƟon asto thesizeof thePremises madebyBrokersorLessor,(e)the squarefootageof the Premiseswas notmaterial toLessee'sdecision tolease thePremises andpaythe Rentstated herein,and(f) neitherLessor,Lessor'sagents,nor Brokershave made anyoral or wriƩen representaƟonsor warranƟes withrespect tosaid maƩersotherthan asset forthinthis Lease. In addiƟon,Lessor acknowledgesthat: (i)Brokers havemade no representaƟons, promisesor warranƟes concerningLessee's abilityto honortheLease orsuitability tooccupythe Premises,and (ii)itis Lessor'ssole responsibilityto invesƟgatethe financialcapabilityand/or suitabilityof allproposed tenants.

2.5 Lessee asPrior Owner/Occupant. The warranƟesmade byLessor inParagraph2 shallbe ofnoforce or effect ifimmediately priortothe StartDate Lessee wasthe owneror occupantofthe Premises. Insuch event,Lesseeshall beresponsible foranynecessary correcƟvework.

3. Term.

3.1 Term. The CommencementDate, ExpiraƟonDateand OriginalTermofthisLease areas specifiedinParagraph 1.3.

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3.2 Early Possession. Anyprovision herein granƟngLessee EarlyPossession ofthePremises issubject toand condiƟoned uponthe Premisesbeing availablefor suchpossession priorto theCommencement Date. Any grantof EarlyPossessiononly conveysa non-exclusiverightto occupyaccess the Premisestoinstall Lessee-suppliedequipmentbyvendorswhoarefullylicensedandinsured. If Lesseetotallyor parƟallyoccupies the Premisesprior tothe Commencement Date,the obligaƟonto payBase Rentshallbe abatedfor theperiodof suchEarly Possession. All otherterms ofthis Lease (includingbut notlimited tothe obligaƟons topay RealProperty Taxesandinsurance premiumsand tomaintain thePremises)shall bein effectduringsuch period.

Anysuch EarlyPossession shallnot affect the ExpiraƟon Date.

3.3 Delay InPossession. Lessor agreestouse commerciallyreasonable effortstodeliver exclusivepossession ofthePremises toLessee bythe CommencementDate. If, despitesaid efforts, Lessoris unableto deliverpossessionby suchdate, Lessorshallnot besubject toanyliability therefor,nor shallsuch failure affect thevalidity ofthisLease orchange the ExpiraƟon Date. Lessee shallnot, however,beobligated topay Rentorperform itsother obligaƟons unƟl Lessor deliverspossession ofthe Premisesandany periodof rentabatement thatLesseewould otherwisehave enjoyedshallrun fromthe dateofdelivery ofpossession and conƟnuefor aperiod equaltowhat Lesseewould otherwisehave enjoyedunderthe termshereof,butminusany daysof delaycausedby theacts oromissions of Lessee. Ifpossession isnotdelivered within60 days aŌer theCommencementDate, asthe samemaybe extendedunder thetermsof anyWork LeƩerexecuted by ParƟes,Lessee may,at its opƟon,by noƟcein wriƟngwithin 10days aŌer theend ofsuch60 dayperiod, cancelthisLease, inwhich eventthe ParƟesshallbe dischargedfrom all obligaƟons hereunder. If such wriƩen noƟceis notreceivedby Lessorwithin said10day period,Lessee's righttocancel shallterminate. If possessionof thePremises isnotdelivered within120 days aŌer theCommencementDate, thisLease shallterminateunless otheragreements arereachedbetween Lessorand Lessee,in wriƟng.

3.4 Lessee Compliance. Lessorshall notberequired totender possessionofthe Premisesto Lessee unƟlLessee complieswith its obligaƟon toprovide evidenceof insurance(Paragraph 8.5). Pending deliveryof suchevidence, Lesseeshallbe requiredto performallof its obligaƟons underthisLease fromand aŌerthe StartDate, includingthe paymentofRent, notwithstandingLessor's elecƟonto withholdpossessionpending receiptof suchevidenceof insurance. Further,ifLessee isrequired toperform anyother condiƟons priorto orconcurrent withtheStart Date,the StartDateshall occurbut Lessormayelect towithhold possession unƟl such condiƟonsare saƟsfied.

4. Rent.

4.1 Rent Defined. Allmonetary obligaƟonsofLessee toLessor undertheterms ofthis Lease(exceptfor theSecurity Deposit)are deemedtobe rent("Rent").

4.2 Payment. Lessee shallcause paymentofRent tobe receivedbyLessor inlawful moneyofthe UnitedStates, without offset or deducƟon(except as specifically permiƩed inthis Lease),onor beforethe dayon whichitis due. Allmonetaryamounts shallbe roundedtothe nearestwhole dollar. Intheevent thatany invoiceprepared byLessor isinaccuratesuch inaccuracyshall not consƟtute awaiverand Lesseeshall beobligatedto paythe amountsetforth inthis Lease. Rentfor anyperiod duringthe termhereofwhich isfor lessthan onefullcalendar monthshall beproratedbased uponthe actualnumberof daysof saidmonth. Paymentof Rentshall bemade toLessorat itsaddress statedherein ortosuch otherpersons orplaceas Lessormay from Ɵmeto Ɵmedesignate in wriƟng. Acceptanceof a paymentwhich isless thantheamount thendue shallnot beawaiver ofLessor's rightstothe balanceof suchRent,regardless ofLessor's endorsementof anycheck so staƟng. In theeventthat anycheck, draŌ,or otherinstrumentof paymentgiven byLesseeto Lessoris dishonoredforany reason,Lessee agreesto paytoLessor thesum of$25 in addiƟonto anyLate Chargeand Lessor,atits opƟon,may requireallfuture paymentsto bemadeby Lesseeto beby cashier'scheck. Paymentswill beapplied firstto accruedlatecharges and aƩorney's fees,second toaccruedinterest, thento BaseRent,Insurance andReal PropertyTaxes,and anyremaining amountto anyother outstandingchargesor costs.

4.3 AssociaƟon Fees. In addiƟonto theBase Rent,Lessee shallpayto Lessoreach monthanamount equalto anyowner's associaƟon orcondominium fees leviedor assessedagainst thePremises. Saidmonies shallbe paidatthe same Ɵme andinthe samemanner astheBase Rent.

5. SecurityDeposit. Lesseeshall depositwith Lessorupon execuƟonhereofthe SecurityDeposit assecurityfor Lessee'sfaithful performanceofits obligaƟons underthis Lease. IfLessee failstopay Rent,or otherwiseDefaultsunder thisLease, Lessormay use,applyor retainall orany porƟon ofsaid SecurityDepositfor the paymentof anyamount alreadydueLessor,forRents whichwill beduein thefuture, and/orto reimburseor compensateLessorfor anyliability,expense,loss or damagewhich Lessormay sufferorincur byreason thereof. IfLessoruses orapplies allorany porƟonof theSecurityDeposit, Lesseeshall within10 days aŌer wriƩenrequest therefordeposit monieswithLessor sufficientto restoresaid SecurityDepositto thefull amountrequiredby thisLease. Ifthe BaseRent increases duringthe termof thisLease,Lessee shall,upon wriƩenrequest fromLessor,deposit addiƟonalmonies withLessorso thatthe totalamountof theSecurity Deposit shallat all Ɵmes bearthesame proporƟonto theincreased BaseRentas the iniƟal SecurityDepositbore tothe iniƟalBaseRent. Should theAgreed Usebeamended toaccommodate amaterial changeinthe businessof Lesseeor toaccommodatea sublesseeor assignee,Lessorshall havethe righttoincrease theSecurity Deposit tothe extentnecessary, inLessor'sreasonable judgment,to accountfor anyincreasedwear andtear thatthePremises may suffer asaresult thereof. Ifa changein controlof Lesseeoccurs duringthisLease andfollowing suchchange the financial condiƟon ofLessee is,inLessor's reasonablejudgment, significantlyreduced,Lessee shalldeposit such addiƟonal monieswithLessor asshall be sufficient tocausethe SecurityDeposit tobeat acommercially reasonablelevelbased onsuch changein financial condiƟon. Lessor shallnotbe requiredto keepthe SecurityDepositseparate fromits generalaccounts. Within90 days aŌerthe expiraƟonor terminaƟonof thisLease, Lessorshall returnthat porƟon ofthe SecurityDeposit notusedor appliedby Lessor. Lessor shallupon wriƩenrequestprovide Lesseewith an accounƟng showinghow that porƟon oftheSecurity Depositthat wasnot returnedwasapplied. No partofthe SecurityDeposit shallbeconsidered tobe heldin trust,tobear interestor tobe prepaymentforany moniesto bepaid byLesseeunder thisLease. THESECURITY DEPOSITSHALL NOTBEUSED BYLESSEE INLIEU OFPAYMENTOF THELAST MONTH'SRENT.

6. Use.

6.1 Use. Lessee shalluse andoccupythe Premisesonly fortheAgreed Use,or anyotherlegal usewhich isreasonably comparablethereto,and forno other purpose. Lesseeshall notuseor permitthe useof thePremisesin amanner thatisunlawful, createsdamage, wasteora nuisance,or thatdisturbs occupantsofor causesdamage toneighboring premisesor properƟes. Other thanguide, signalandseeing eyedogs, Lesseeshallnot keepor allowinthe Premisesany pets,animals, birds, fish, or repƟles. Lessorshall notunreasonably withholdor delayitsconsent toany wriƩenrequestfor a modificaƟon oftheAgreed Use,so longas thesamewill notimpair thestructural integrityofthe improvementson thePremises orthemechanical orelectrical systemstherein,and/or isnot significantlymoreburdensome tothe Premises. IfLessorelects towithhold consent,Lessor shallwithin7 days aŌer suchrequestgive wriƩen noƟficaƟon ofsame,which noƟceshall includean explanaƟonof Lessor's objecƟons tothechange inthe AgreedUse.

6.2 Hazardous Substances.
(a) Reportable UsesRequire Consent. The term"Hazardous Substance"as usedinthis Leaseshall meananyproduct, substance,or wastewhose presence,use, manufacture,disposal, transportaƟon,orrelease, eitherby itselfor incombinaƟonwith othermaterials expectedtobe onthe Premises,iseither: (i) potenƟallyinjurious tothe publichealth,safety orwelfare, theenvironment orthePremises, (ii)regulated ormonitoredby anygovernmental authority,or(iii) abasis for potenƟal liabilityof Lessortoany governmentalagency orthird partyunderany applicablestatute orcommonlaw theory. HazardousSubstancesshall include,but notbe limitedto, hydrocarbons,petroleum,gasoline, and/orcrude oilor anyproducts,byproducts or fracƟons thereof. Lessee shallnot engageinany acƟvityin oron

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thePremises which consƟtutes aReportableUse ofHazardous Substanceswithout theexpressprior wriƩenconsent ofLessorand Ɵmelycompliance (atLessee's expense)with allApplicable Requirements. "Reportable Use"shall mean(i) the installaƟonor useof anyaboveor belowground storagetank,(ii) the generaƟon, possession,storage,use, transportaƟon, ordisposalof aHazardous Substancethat requiresapermit from,or withrespectto whicha report, noƟce, registraƟon or businessplan isrequired tobe filed with,any governmentalauthority,and/or(iii)the presenceat thePremisesof aHazardous Substancewithrespect towhich any ApplicableRequirements requiresthat a noƟcebe givento personsentering oroccupyingthe Premisesor neighboring properƟes. Notwithstandingthe foregoing, Lesseemay useany ordinaryandcustomary materialsreasonably requiredto beusedin thenormal courseofthe AgreedUse, ordinary officesupplies (copiertoner, liquidpaper,glue,etc.) andcommonhousehold cleaningmaterials, solong assuchuse isin compliancewithall ApplicableRequirements, isnota ReportableUse, and doesnot exposethe Premisesorneighboring propertyto anymeaningful riskof contaminaƟon ordamage orexposeLessor toany liabilitytherefor. In addiƟon, Lessormay condiƟonits consenttoany ReportableUse uponreceiving such addiƟonal assurances asLessor reasonablydeemsnecessary toprotect itself,thepublic, thePremises and/orthe environmentagainstdamage, contaminaƟon,injury and/orliability,including,butnot limitedto, the installaƟon(and removalon orbefore Lease expiraƟon or terminaƟon) of protecƟve modificaƟons (suchas concreteencasements) and/orincreasingthe SecurityDeposit. (b) Dutyto InformLessor. IfLessee knows,or hasreasonablecause tobelieve, thata HazardousSubstancehas cometo belocatedin, on,under or aboutthe Premises,other thanaspreviously consentedto byLessor,Lesseeshallimmediately give wriƩen noƟceofsuch factto Lessor,andprovide Lessorwith a copyof anyreport, noƟce,claimor other documentaƟon whichit hasconcerningthe presenceof suchHazardousSubstance. (c) Lessee RemediaƟon. Lessee shallnotcause orpermit anyHazardous Substancetobe spilledor releasedin,on, under,or aboutthePremises (includingthrough theplumbing orsanitarysewer system)and shallpromptly,atLessee'sexpense, complywith allApplicableRequirements andtake all invesƟgatory and/orremedial acƟonreasonably recommended,whetheror notformally orderedor required,forthe cleanupof any contaminaƟonof,andfor themaintenance, securityand/or monitoringof thePremisesor neighboring properƟes, thatwas causedormaterially contributedto byLessee,or pertainingto orinvolvingany HazardousSubstance broughtonto thePremisesduring theterm ofthis Lease,byor forLessee, oranythird party. (d) Lessee IndemnificaƟon. Lessee shallindemnify,defend andhold Lessor,itsagents, employees,lenders andground lessor,ifany,harmlessfrom and againstany andall lossofrents and/ordamages, liabiliƟes,judgments, claims,expenses,penalƟes, and aƩorneys' andconsultants'fees arisingout oforinvolving any HazardousSubstance broughtonto thePremisesby orfor Lessee,or anythirdparty (provided,however,thatLesseeshall haveno liabilityunderthis Leasewith respectto underground migraƟon ofanyHazardous Substanceunder thePremises fromadjacent properƟes notcaused orcontributedto byLessee). Lessee's obligaƟonsshall include,but notbelimited to,the effectsof any contaminaƟonor injuryto person,propertyor theenvironment createdor suffered byLessee, and thecost of invesƟgaƟon, removal, remediaƟon, restoraƟon and/orabatement, andshall survivethe expiraƟon or terminaƟon ofthisLease. No terminaƟon, cancellaƟonor releaseagreement enteredintoby Lessorand Lesseeshall releaseLesseefrom itsobligaƟons underthisLease withrespect toHazardous Substances,unless specificallyso agreedbyLessor in wriƟng atthe Ɵmeofsuch agreement. (e) Lessor IndemnificaƟon. Except asotherwise providedin paragraph8.7,Lessor andits successorsandassigns shallindemnify, defend,reimburseand holdLessee, itsemployees andlenders,harmless fromand againstany andallenvironmental damages,including thecostof remediaƟon, whichresultfrom HazardousSubstances whichexisted onthePremises priorto Lessee'soccupancy orwhichare causedby thegrossnegligence orwillful misconductofLessor,its agentsor employees. Lessor's obligaƟons,as andwhen requiredby theApplicableRequirements, shallinclude, butnotbe limitedto,thecostof invesƟgaƟon, removal, remediaƟon, restoraƟonand/or abatement,andshall survivethe expiraƟonor terminaƟonofthis Lease. (f) InvesƟgaƟons and RemediaƟons. Lessorshall retaintheresponsibility andpay forany invesƟgaƟons or remediaƟon measuresrequired by governmental enƟƟes having jurisdicƟon withrespectto theexistence ofHazardous Substancesonthe Premisesprior toLessee'soccupancy, unlesssuch remediaƟon measureis requiredas aresultof Lessee'suse (including "AlteraƟons", as definedin paragraph7.3(a) below)ofthe Premises,in whicheventLessee shallbe responsiblefor suchpayment. Lesseeshall cooperatefully inany such acƟviƟesat therequest ofLessor,including allowingLessor andLessor'sagents tohave reasonableaccess tothe Premisesatreasonable Ɵmesin orderto carryoutLessor's invesƟgaƟveand remedial responsibiliƟes. (g) Lessor T erminaƟonOpƟon. If aHazardousSubstance CondiƟon(see Paragraph9.1(e))occurs duringthe termofthis Lease,unless Lesseeis legally responsibletherefor(inwhich caseLesseeshall makethe invesƟgaƟonand remediaƟonthereofrequired bythe ApplicableRequirementsand thisLease shall conƟnue infull forceand effect,butsubject toLessor's rightsunder Paragraph6.2(d)and Paragraph13), Lessormay,at Lessor's opƟon, either(i) invesƟgate andremediate such HazardousSubstance CondiƟon,if required,assoon asreasonably possibleat Lessor'sexpense,in whichevent thisLeaseshall conƟnuein fullforceand effect,or (ii)if the esƟmated costto remediatesuch condiƟon exceeds12 Ɵmesthe thenmonthlyBase Rentor $100,000,whicheveris greater,give wriƩen noƟceto Lessee,within 30days aŌerreceipt byLessorof knowledgeof theoccurrence ofsuchHazardous Substance CondiƟon, ofLessor'sdesire toterminate thisLeaseas ofthe date60 daysfollowing thedate ofsuch noƟce. In theevent Lessorelectsto givea terminaƟon noƟce,Lessee may,within 10days thereaŌer ,give wriƩen noƟceto Lessorof Lessee'scommitment topay theamountby whichthe costof the remediaƟonof suchHazardous Substance CondiƟonexceeds anamount equalto12 Ɵmesthe then monthlyBase Rentor $100,000,whicheveris greater. Lesseeshall provideLessorwith saidfunds or saƟsfactoryassurance thereofwithin 30daysfollowing such commitment. Insuch event,thisLease shall conƟnue infull forceand effect, andLessor shallproceedto makesuch remediaƟonassoon asreasonably possible aŌer therequired fundsare available. If Lesseedoes notgive such noƟceand providethe requiredfundsor assurancethereof withinthe Ɵme provided,this Leaseshall terminateas ofthe date specifiedin Lessor's noƟce of terminaƟon.

6.3 Lessee's Compliance with ApplicableRequirements. Exceptas otherwiseprovided inthisLease, Lesseeshall, atLessee'ssole expense,fully,diligentlyand ina Ɵmelymanner,materiallycomplywith allApplicable Requirements,the requirementsofany applicable fire insuranceunderwriteror raƟngbureau, andthe recommendaƟonsof Lessor'sengineers and/orconsultantswhich relatein anymanner tothePremises, withoutregard towhethersaid ApplicableRequirements are nowin effector become effecƟve aŌer theStart Date. Lesseeshall,within 10days aŌerreceiptof Lessor's wriƩen request,provideLessor withcopies ofall permits andother documents,and other informaƟonevidencing Lessee'scompliance withany ApplicableRequirements specified byLessor,andshallimmediately upon receipt, noƟfy Lessorin wriƟng(withcopies ofany documentsinvolved) ofanythreatened oractual claim, noƟce, citaƟon, warning,complaint orreportpertaining to orinvolving thefailure ofLesseeor thePremises tocomply withanyApplicable Requirements. Likewise,Lesseeshall immediatelygive wriƩen noƟceto Lessorof: (i) anywater damageto thePremisesand anysuspected seepage,pooling, dampnessorother condiƟonconducive tothe producƟon ofmold; or(ii)any musƟnessor otherodors thatmight indicatethepresence ofmold inthe Premises. In addiƟon,Lessee shallprovideLessor withcopies ofitsbusiness license, cerƟficate of occupancyand/or anysimilar documentwithin10 daysof thereceipt ofa wriƩen requesttherefor.

6.4 InspecƟon; Compliance. Lessorand Lessor's"Lender"(as definedin Paragraph30)and consultantsauthorized byLessorshall havethe rightto enterinto Premisesat any Ɵme inthecase ofan emergency,and otherwiseatreasonable Ɵmes aŌer reasonable noƟce,for thepurpose of inspecƟngand/or tesƟngthe condiƟonof thePremises and/orforverifying complianceby Lesseewith thisLease. Thecost ofanysuch inspecƟonsshall bepaidby Lessor,unless a violaƟon of ApplicableRequirements, ora HazardousSubstance CondiƟon (seeParagraph9.1(e))is foundtoexist orbe imminent,orthe inspecƟonis requestedorordered bya governmentalauthority. In suchcase,Lessee shallupon requestreimburse Lessorforthe costof such inspecƟon,so longas such inspecƟonis reasonablyrelated to the violaƟon or contaminaƟon. In addiƟon, Lesseeshall providecopies ofallrelevant materialsafety datasheets(MSDS) toLessor within10days ofthe receiptof a wriƩenrequest therefor. Lesseeacknowledges that anyfailure onits parttoallow such inspecƟons or tesƟngwill exposeLessor torisksand potenƟallycause Lessor toincur costsnot contemplatedbythis Lease,the extentof whichwillbe extremely difficult toascertain. Accordingly,should theLesseefail toallow such inspecƟons

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and/or tesƟng ina Ɵmelyfashionthe BaseRentshallbe automaƟcallyincreased,without anyrequirement for noƟceto Lessee,by anamountequal to10% ofthe then exisƟng BaseRent or$100,whichever isgreater forthe remaindertothe Lease. The ParƟesagree thatsuch increaseinBase Rentrepresents fairand reasonable compensaƟonfor the addiƟonal risk/coststhatLessor willincur byreason ofLessee'sfailure toallow such inspecƟonand/or tesƟng. Suchincreasein BaseRentshall inno event consƟtute awaiverof Lessee'sDefault orBreach withrespectto suchfailure norpreventthe exerciseof anyofthe otherrights andremedies granted hereunder.

7. Maintenance;Repairs; UƟlity InstallaƟons;TradeFixturesand AlteraƟons.

7.1 Lessee's ObligaƟons.
(a) In General. Subjecttothe provisionsof Paragraph2.2 (CondiƟon), 2.3(Compliance), 6.3(Lessee's CompliancewithApplicable Requirements),7.2 (Lessor's ObligaƟons), 9(Damage or DestrucƟon),and 14 (CondemnaƟon), Lesseeshall, atLessee'ssole expense,keep thePremises, UƟlity InstallaƟons(intended for Lessee'sexclusive use,no maƩerwherelocated), and AlteraƟons ingood order, condiƟonand repair(whether ornotthe porƟonof thePremisesrequiring repairs,or themeans ofrepairing thesame,are reasonablyor readilyaccessible toLessee,and whetheror nottheneed forsuch repairsoccursas aresult ofLessee's use,any prioruse, theelements ortheage ofsuch porƟonof thePremises),including, butnot limitedto,all equipmentor faciliƟes,suchas plumbing, HVACequipment, electrical, lighƟng faciliƟes,boilers, pressurevessels, fire protecƟonsystem, fixtures,walls (interiorandexterior), ceilings, floors, stairs,windows,doors, plateglass, skylights,landscaping, driveways,parking lots,fences,retaining walls,signs, sidewalksand parkwayslocatedin, on,or adjacenttothe Premises. Lesseeisalso responsiblefor keepingthe roofandroof drainageclean andfree ofdebris. Lessorshall keepthesurface andstructural elementsofthe roof, foundaƟons, andbearing wallsin goodrepair (seeparagraph7.2). Lessee, inkeeping thePremisesin goodorder, condiƟonandrepair,shallexercise andperformgood maintenance pracƟces, specificallyincluding theprocurement andmaintenanceof theservice contractsrequired byParagraph7.1(b) below. Lessee's obligaƟonsshall include restoraƟons, replacementsor renewalswhen necessarytokeep thePremises andall improvementsthereonor apart thereofingood order, condiƟon andstateof repair. Lessee shall,during theterm ofthisLease, keepthe exteriorappearance oftheBuilding ina first-class condiƟon(including, e.g. graffiƟ removal)consistentwith theexterior appearanceof othersimilar faciliƟesofcomparable ageand sizein thevicinity,including, whennecessary, theexterior repainƟng ofthe Building. (b) ServiceContracts. Lessee shall,atLessee's soleexpense, procureandmaintain contracts,with copiesto Lessor,incustomary formand substancefor, andwith contractorsspecializing andexperiencedin themaintenance ofthe followingequipmentand improvements,if any,ifand wheninstalled onthePremises: (i) HVACequipment, (ii)boiler,andpressurevessels, (iii) fire exƟnguishingsystems,including firealarm and/orsmoke detecƟon,(iv) landscapingand irrigaƟon systems, and(v) clarifiers. However,Lessorreserves theright, upon noƟce toLessee,to procureand maintainanyor allof suchservicecontracts, andLessee shallreimburse Lessor,upon demand,for thecostthereof. LessorshallprocureandmaintainservicecontractsfortheHVAC equipment,firesystemsandthemonitoringofthefiresprinklersystemsthatwereoriginallyinstalledby LessorservingthePremisesandLesseeshallreimburseLessorforthecoststhereof,includingnecessary repairs,withestimatestowardthosecostsdueinadditiontotheotherscheduledrentalamounts. (c) Failureto Perform. IfLesseefails toperform Lessee's obligaƟons underthisParagraph7.1,Lessor mayenterupon thePremises aŌer10days' prior wriƩen noƟce toLessee (exceptinthe caseof anemergency,inwhichcase no noƟce shallberequired), performsuch obligaƟonsonLessee's behalf,and putthe Premisesin goodorder, condiƟonandrepair,andLessee shallpromptly paytoLessor asum equalto115% ofthe costthereof. (d) Replacement. Subjectto Lessee's indemnificaƟonof Lessoras setforthin Paragraph8.7 below,and withoutrelievingLessee ofliability resulƟngfrom Lessee'sfailure toexercise andperformgood maintenance pracƟces, ifan itemdescribedin Paragraph7.1(b) cannotberepaired otherthan atacost whichis inexcess of50% ofthe costofreplacing suchitem, thensuch itemshallbe replacedby Lessor,andthe costthereof shallbeprorated betweenthe ParƟesand Lesseeshallonly beobligated topay,eachmonthduring theremainder ofthe termofthis Leaseor anyextensionthereof,onthe dateonwhich BaseRent isdue, anamountequal to theproduct of mulƟplying thecostof suchreplacement bya fracƟon,thenumerator ofwhich isone,and thedenominator ofwhichis 144(i.e. 1/144thof thecostper month). Lesseeshall payIntereston the unamorƟzed balancebut mayprepayits obligaƟonat any Ɵme.

7.2 Lessor's ObligaƟons. Subjectto theprovisionsof Paragraphs2.2 (CondiƟon),2.3(Compliance), 9(Damage or DestrucƟon)and 14 (CondemnaƟon), itis intendedby the ParƟes heretothatLessor haveno obligaƟon,in anymannerwhatsoever,torepair andmaintainthe Premises,or theequipmenttherein, allof which obligaƟonsare intendedto bethatof theLessee, exceptfor thesurfaceand structuralelements oftheroof, foundaƟonsand bearingwalls,the repairof whichshall be theresponsibility ofLessor uponreceiptof wriƩen noƟce thatsuch arepairis necessary. Itisthe intenƟonof the ParƟesthat theterms ofthis Leasegovernthe respecƟve obligaƟons ofthe ParƟesasto maintenanceand repairof thePremises.

7.3 UƟlity InstallaƟons;TradeFixtures; AlteraƟons.
(a) DefiniƟons. The term"UƟlity InstallaƟons" refersto all floor andwindowcoverings, airand/or vacuumlines,power panels,electrical distribuƟon, securityand fire protecƟon systems, communicaƟoncabling, lighƟng fixtures, HVACequipment, plumbing, andfencing inor onthePremises. The term"Trade Fixtures"shall meanLessee's machineryandequipment thatcan beremoved withoutdoingmaterial damageto thePremises. Theterm "AlteraƟons"shallmean any modificaƟonof theimprovements, otherthan UƟlity InstallaƟonsor TradeFixtures, whetherbyaddiƟon or deleƟon. "LesseeOwned AlteraƟonsand/or UƟlity InstallaƟons"are definedas AlteraƟonsand/or UƟlity InstallaƟonsmade byLessee thatarenot yetowned byLessorpursuant toParagraph7.4(a). (b) Consent. Lesseeshall notmakeany AlteraƟonsor UƟlity InstallaƟonsto thePremises withoutLessor's prior wriƩenconsent. Lessee may,however, makenon-structural AlteraƟonsor UƟlity InstallaƟonsto theinterior ofthe Premises(excludingthe roof)without suchconsentbut upon noƟce toLessor,as longas theyare notvisible fromtheoutside, donot involvepuncturing, relocaƟngorremoving theroof orany exisƟng walls,will not affectthe electrical,plumbing, HVAC, and/orlife safetysystems, donottrigger therequirement for addiƟonal modificaƟonsand/orimprovements tothe Premises resulƟngfrom ApplicableRequirements, suchas compliancewith Title24,and the cumulaƟve costthereof duringthisLease asextended doesnotexceed asum equalto3 month'sBase Rentin theaggregate ora sumequal toonemonth's BaseRent inany oneyear. Notwithstandingthe foregoing,Lesseeshall notmake orpermitany roof penetraƟons and/orinstall anythingon theroof withouttheprior wriƩenapproval ofLessor. Lessormay,asa precondiƟonto granƟng suchapproval, requireLesseeto uƟlizea contractor chosenand/or approvedby Lessor. Any AlteraƟonsor UƟlity InstallaƟons thatLesseeshall desireto makeandwhich requirethe consentofthe Lessorshall be presentedto Lessorin wriƩenformwith detailedplans. Consent shallbedeemed condiƟonedupon Lessee's: (i) acquiringall applicablegovernmentalpermits, (ii) furnishingLessor withcopies ofboththe permitsand theplans and specificaƟonsprior tocommencement ofthework, and(iii) compliancewithall condiƟonsof said permitsand otherApplicable Requirementsina promptand expediƟousmanner. Any AlteraƟons or UƟlity InstallaƟonsshallbe performedin aworkmanlikemanner withgood and sufficient materialsbyappropriatelylicensedandinsuredcontractorsandvendors. Lessee shallpromptly upon compleƟonfurnish Lessorwith as-builtplansand specificaƟons. Forwork whichcostsan amountin excessofone month'sBase Rent,Lessormay condiƟonits consentupon Lesseeproviding alienand compleƟonbond inan amountequalto 150%of the esƟmatedcost ofsuch AlteraƟonor UƟlity InstallaƟonand/or upon Lessee's posƟng an addiƟonal SecurityDepositwith Lessor. (c) Liens;Bonds. Lessee shallpay,when due,all claimsfor laborormaterials furnishedor allegedtohave beenfurnished toorfor Lesseeat orfor useon thePremises, whichclaims areormay besecured byany mechanic'sormaterialmen's lienagainst thePremisesor anyinterest therein. Lessee shallgive Lessornot lessthan 10days noƟcepriorto thecommencement ofany workin,on orabout thePremises,and Lessorshall havetheright topost noƟcesof non-responsibility. If

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Lesseeshall contestthe validityofany suchlien, claimor demand,thenLessee shall,at itssoleexpense defendand protectitself,Lessor andthe Premisesagainst the sameand shallpay and saƟsfyany suchadverse judgmentthat mayberendered thereonbefore theenforcementthereof. If Lessorshallrequire, Lesseeshall furnish asurety bondin anamountequal to150% ofthe amountofsuch contestedlien, claimordemand, indemnifyingLessor againstliabilityfor thesame. If Lessorelects to parƟcipate inany such acƟon,Lessee shallpay Lessor's aƩorneys' feesandcosts.

7.4 Ownership; Removal;Surrender; and RestoraƟon.
(a) Ownership. Subject toLessor'sright torequire removalor electownershipas hereinaŌerprovided, all AlteraƟonsand UƟlity InstallaƟons madeby Lesseeshall bethe propertyofLessee, butconsidered apart ofthePremises. Lessor may,atany Ɵme,elect in wriƟngto bethe ownerof allorany specifiedpart of theLessee Owned AlteraƟons and UƟlity InstallaƟons. Unless otherwiseinstructed perparagraph7.4(b) hereof,all LesseeOwned AlteraƟons and UƟlity InstallaƟons shall,at the expiraƟon or terminaƟonof thisLease, becomethe propertyofLessor andbe surrenderedbyLessee withthe Premises. (b) Removal. Bydelivery toLesseeof wriƩen noƟce fromLessornot earlierthan 90and notlaterthan 30days priortothe endof thetermof thisLease, Lessormay requirethat anyorall LesseeOwned AlteraƟonsor UƟlity InstallaƟonsbe removedby the expiraƟonor terminaƟonof thisLease. Lessormay requirethe removalat any Ɵme ofallor anypart ofany LesseeOwned AlteraƟons or UƟlity InstallaƟonsmadewithout therequired consent. (c) Surrender; RestoraƟon. Lessee shallsurrenderthe Premisesby the ExpiraƟon Dateorany earlier terminaƟon date,withall ofthe improvements, partsand surfacesthereof broomcleanand freeof debris,and ingood operaƟng order, condiƟon andstateof repair,ordinary wearandtear excepted. "Ordinary wearand tear"shall notincludeany damageor deterioraƟonthat wouldhavebeen preventedby goodmaintenance pracƟce. Notwithstanding theforegoingand the provisionsof Paragraph7.1(a), iftheLessee occupiesthe Premisesfor 12monthsor less,then Lesseeshallsurrender thePremises inthesame condiƟonas delivered toLessee onthe StartDatewith NOallowance forordinary wearandtear. Lessee shallrepairany damageoccasioned bythe installaƟon, maintenanceor removalof TradeFixtures, Lesseeowned AlteraƟonsand/or UƟlity InstallaƟons,furnishings, andequipment aswellas theremoval ofanystoragetankinstalled byorfor Lessee.

Lesseeshall alsocompletely removefromthe Premisesany andall HazardousSubstancesbrought ontothe Premisesbyor forLessee, oranythird party(except HazardousSubstances whichwere depositedviaunderground migraƟonfrom areasoutside ofthePremises) tothe level specifiedin ApplicableRequirements. Trade Fixturesshall remainthe propertyofLessee andshall beremoved byLessee. Anypersonal propertyofLessee notremoved onorbefore the ExpiraƟon Dateor any earlier terminaƟon dateshall bedeemedto havebeen abandonedby Lesseeandmay bedisposed oforretained byLessor asLessormay desire. Thefailure byLessee to Ɵmely vacatethe Premisespursuantto thisParagraph 7.4(c)without theexpress wriƩen consentof Lessorshall consƟtute aholdover undertheprovisions of Paragraph26 below.

8. Insurance;Indemnity.

8.1 Payment ofPremium Increases.
(a) Lessee shallpay toLessorany insurancecost increase("Insurance CostIncrease")occurring duringthe termofthis Lease. InsuranceCostIncrease is definedas anyincrease intheactual costof theinsurance requiredunderParagraph 8.2(b),8.3(a) and8.3(b),over andabove theBasePremium as hereinaŌer defined calculatedon anannual basis. Insurance CostIncrease shallinclude butnotbe limitedto increases resulƟngfrom thenature ofLessee'soccupancy, anyact or omissionof Lessee,requirements oftheholder ofmortgage ordeed oftrustcovering thePremises, increased valuaƟonof thePremises and/orapremium rate increase. The parƟes areencouragedto fillin theBase PremiuminParagraph 1.8with areasonablepremium forthe RequiredInsurancebased onthe AgreedUse of thePremises. If the parƟesfail toinsert adollar amountinParagraph1.8,then theBasePremium shallbe thelowestannual premiumreasonably obtainablefor the RequiredInsurance asof thecommencementof theOriginal Termfor theAgreedUse ofthe Premises. In noevent, however,shallLessee beresponsible forany porƟonof theincrease inthepremium cost aƩributable toliability insurancecarriedby Lessorunder Paragraph8.2(b)in excessof $2,000,000peroccurrence. (b) Lesseeshall payany suchInsuranceCost Increaseto Lessorwithin30 days aŌer receiptby Lesseeofa copyof thepremiumstatement orother reasonableevidence ofthe amountdue.If theinsurance policiesmaintained hereundercoverother propertybesides thePremises,Lessor shallalso delivertoLessee astatement ofthe amountofsuch InsuranceCost Increase aƩributable onlytothe Premisesshowing inreasonabledetail themanner inwhichsuch amountwas computed. Premiumsfor policyperiodscommencing priorto, orextending beyondtheterm ofthis Lease,shallbe proratedto correspondtothe termof thisLease.

8.2 Liability Insurance.
(a) Carried byLessee. Lesseeshall obtainand keepin forceaCommercial GeneralLiability policyofinsurance protecƟngLessee andLessoras an addiƟonalinsured againstclaims forbodilyinjury,personalinjury andproperty damagebasedupon orarising outofthe ownership,use, occupancyormaintenance of thePremises andall areasappurtenantthereto. Such insuranceshall beonan occurrencebasis providingsinglelimit coveragein anamountnot lessthan $1,000,000 peroccurrence withan annualaggregateof notless than$2,000,000. Lesseeshall addLessor asan addiƟonal insuredby meansofan endorsementat leastas broad asthe InsuranceService OrganizaƟon's "AddiƟonalInsured-Managers orLessors ofPremises" Endorsement. The policyshall notcontainany intra-insuredexclusions asbetween insuredpersons or organizaƟons,but shallinclude coveragefor liabilityassumedunder thisLease asan"insured contract"for theperformanceof Lessee's indemnity obligaƟons underthis Lease. The limitsof saidinsurance shallnot,however,limitthe liabilityofLessee norrelieve Lesseeofany obligaƟonhereunder.

Lesseeshall providean endorsementonits liabilitypolicy(ies) whichprovides thatitsinsurance shallbe primarytoand notcontributory withanysimilar insurance carriedby Lessor,whose insuranceshallbe consideredexcess insuranceonly. (b) Carriedby Lessor. Lessorshallmaintain liabilityinsurance asdescribedin Paragraph8.2(a), in addiƟon to,andnot inlieu of,theinsurance requiredto bemaintained byLessee. Lesseeshall notbe namedas an addiƟonalinsured therein.

8.3 Property Insurance- Building,Improvements andRentalValue. (a) Building andImprovements. TheInsuring Partyshall obtainand keepinforce apolicy orpoliciesin thename ofLessor,with losspayable toLessor, anyground-lessor,andto anyLenderinsuring lossor damageto thePremises. Theamount ofsuchinsurance shallbe equaltothe fullinsurable replacementcost of thePremises, asthe sameshallexist from Ɵme to Ɵme, ortheamount requiredby anyLender,but inno eventmorethan thecommercially reasonableand available insurablevalue thereof. LesseeOwned AlteraƟons and UƟlity InstallaƟons,TradeFixtures,andLessee's personalproperty shallbeinsured byLessee notbyLessor. If thecoverage isavailable andcommerciallyappropriate, suchpolicy orpolicies shallinsureagainst allrisks ofdirectphysical lossor damage(exceptthe perilsof flood and/orearthquake unlessrequired byaLender orincluded inthe BasePremium),including coveragefor debrisremovaland theenforcement ofanyApplicable Requirementsrequiring theupgrading, demoliƟon, reconstrucƟonor replacementof any porƟon ofthePremises asthe resultofa coveredloss. Saidpolicy orpolicies shallalso containan agreed valuaƟonprovision inlieu ofany coinsuranceclause,waiver ofsubrogaƟon, and inflaƟonguard protecƟoncausing anincreasein the annualproperty insurancecoverage amountbya factorof notless thantheadjusted U.S.Department ofLaborConsumer PriceIndex forAllUrban Consumersfor the citynearest towhere thePremisesare located. Ifsuch insurancecoveragehas a deducƟble clause,the deducƟble amountshall notexceed$5,000 peroccurrence, andLessee shallbe liableforsuch deducƟbleamount inthe eventofan InsuredLoss. (b) RentalValue. The InsuringPartyshall obtainand keepinforce apolicy orpolicies inthename ofLessor withlosspayable toLessor andanyLender, insuringthe lossof thefullRent forone yearwith anextendedperiod ofindemnity foran addiƟonal 180days ("RentalValueinsurance"). Said insuranceshall contain anagreed valuaƟonprovision inlieuof anycoinsurance clause,and theamountof coverageshall beadjustedannually to reflect theprojectedRent otherwisepayable byLessee, forthe next12month period. Lesseeshall beliablefor any deducƟble amountinthe eventof suchloss.

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(c) AdjacentPremises. If thePremisesare partof alargerbuilding, orof agroup ofbuildingsowned byLessor whichareadjacent tothe Premises,the Lesseeshall payfor anyincreasein thepremiums forthe propertyinsuranceof suchbuilding orbuildingsif saidincrease iscausedby Lessee'sacts, omissions,use or occupancyof thePremises.

8.4 Lessee's Property;Business InterrupƟonInsurance; Worker's CompensaƟon Insurance. (a) Property Damage. Lesseeshallobtain andmaintain insurancecoverage onallof Lessee'spersonal property,TradeFixtures, andLessee Owned AlteraƟonsand UƟlity InstallaƟons. Suchinsurance shallbe fullreplacement costcoveragewith a deducƟble ofnotto exceed$1,000 peroccurrence. Theproceeds fromany suchinsurance shallbeused byLessee forthe replacementofpersonal property,TradeFixturesandLessee Owned AlteraƟons and UƟlity InstallaƟons. (b) Business InterrupƟon. Lessee shallobtainand maintainloss ofincomeand extraexpense insurancein amountsaswill reimburseLessee fordirector indirectloss ofearnings aƩributabletoall perilscommonly insuredagainst byprudentlessees inthe businessofLessee or aƩributable to prevenƟonof accessto the Premisesas aresult ofsuchperils.
(c) Worker's CompensaƟon Insurance. Lesseeshallobtain andmaintain Worker's CompensaƟon Insuranceinsuch amountas mayberequired by ApplicableRequirements. Such policyshallinclude a'Waiver of SubrogaƟon' endorsement. Lessee shallprovide Lessorwitha copyof suchendorsementalong with the cerƟficate ofinsurance orcopyof thepolicy requiredby paragraph8.5. (d) No RepresentaƟon ofAdequate Coverage. Lessor makesno representaƟonthatthe limitsor formsof coverageofinsurance specifiedherein are adequateto coverLessee's property,business operaƟons or obligaƟons underthis Lease.

8.5 Insurance Policies. Insurancerequired hereinshallbe bycompanies maintainingduringthe policyterm a"GeneralPolicyholders RaƟng"of atleast A-,VII, asset forthin themostcurrent issueof "Best'sInsurance Guide",orsuch other raƟng asmaybe requiredby aLender. Lesseeshall notdo orpermitto bedone anythingwhich invalidatesthe requiredinsurancepolicies. Lessee shall,prior totheStart Date,deliver toLessor cerƟfied copiesof policiesofsuch insuranceor cerƟficateswith copiesof therequiredendorsements evidencingthe existenceand amountsofthe requiredinsurance. Nosuch policyshall becancelableor subject to modificaƟon except aŌer 30daysprior wriƩen noƟce toLessor. Lesseeshall, atleast 10daysprior tothe expiraƟonofsuch policies,furnish Lessorwith evidenceof renewalsor "insurancebinders" evidencingrenewalthereof, orLessor mayincrease hisliabilityinsurance coverageand chargethecost thereofto Lessee,which amountshall bepayable byLesseeto Lessorupon demand. Suchpoliciesshall befor atermof atleast oneyear,or thelength ofthe remainingtermof thisLease, whicheveris less. IfeitherParty shallfail toprocure andmaintainthe insurancerequired tobecarried byit, theotherParty may,but shallnot berequiredto,procure andmaintain thesame.

8.6 Waiver of SubrogaƟon. Without affecƟnganyother rightsor remedies,Lesseeand Lessoreach herebyreleaseand relievethe other,and waivetheir enƟre rightto recoverdamages againsttheother,forloss ofor damagetoits propertyarising outofor incidentto theperilsrequired tobe insuredagainst herein. The effectof suchreleases andwaiversis notlimited bythe amountofinsurance carriedor required,orby any deducƟbles applicablehereto. The ParƟes agreeto have their respecƟve propertydamage insurancecarrierswaive anyright to subrogaƟon thatsuchcompanies mayhave againstLessoror Lessee,as thecasemay be,so longas theinsurance isnotinvalidated thereby.

8.7 Indemnity. Except forLessor's grossnegligenceor willfulmisconduct, Lesseeshallindemnify,protect,defend andholdharmless thePremises, Lessorand itsagents, Lessor'smaster orgroundlessor,partnersand Lenders,from andagainstany andall claims,lossof rentsand/or damages,liens,judgments, penalƟes, aƩorneys'and consultants'fees, expensesand/or liabiliƟes arisingout of,involving, orinconnecƟon with,a Breachofthe Leaseby Lesseeand/orthe useand/or occupancyof thePremises and/orProjectby Lesseeand/or byLessee's employees,contractorsor invitees. Ifany acƟon orproceeding isbroughtagainst Lessorby reasonof anyof theforegoing maƩers, Lesseeshall upon noƟce defendthesame atLessee's expensebycounsel reasonably saƟsfactory toLessorand Lessorshall cooperatewith Lesseein suchdefense. Lessorneed nothave firstpaidany suchclaim inorderto bedefended or indemnified.

8.8 ExempƟon ofLessor andits AgentsfromLiability. Notwithstanding thenegligenceor breachof thisLeaseby Lessoror itsagents, neitherLessornor its agentsshall beliable underanycircumstances for:(i) injuryor damagetothe personor goods,wares,merchandise orother propertyofLessee, Lessee'semployees, contractors,invitees, customers,or anyotherperson inor aboutthe Premises,whethersuch damageor injuryiscaused byor resultsfrom fire, steam,electricity,gas, wateror rain,indoor airquality,the presenceof moldor fromthebreakage, leakage, obstrucƟon orotherdefects ofpipes, firesprinklers,wires, appliances,plumbing, HVACor lighƟng fixtures, orfromany othercause, whetherthe saidinjuryor damageresults from condiƟonsarising uponthe Premisesorupon other porƟons ofthe buildingof whichthe Premisesarea part,or fromother sourcesorplaces, (ii)any damagesarisingfrom anyact orneglectof anyother tenantof Lessororfrom the failureof Lessoror itsagentsto enforcethe provisionsof anyotherlease inthe Project,or(iii) injuryto Lessee'sbusinessor forany lossof incomeor profit therefrom.

Instead,it isintended thatLessee'ssole recoursein theevent ofsuchdamages orinjury beto file aclaim ontheinsurance policy(ies)that Lesseeis requiredto maintainpursuant tothe provisionsofparagraph 8.

8.9 Failure toProvide Insurance. Lesseeacknowledgesthat anyfailure onitspart toobtain ormaintainthe insurancerequired hereinwill exposeLessorto risksand potenƟallycause Lessortoincur costsnot contemplatedby thisLease,the extentof whichwillbe extremely difficult toascertain. Accordingly,for anymonth or porƟon thereofthat Lesseedoesnot maintainthe requiredinsurance and/ordoesnot provideLessor withtherequired bindersor cerƟficatesevidencingthe existenceof therequired insurance,theBase Rentshall be automaƟcally increased,withoutany requirementfor noƟcetoLessee, byan amountequalto 10%of the then exisƟng BaseRent or$100,whichever isgreater. The parƟesagreethat suchincrease inBaseRent representsfair andreasonable compensaƟon forthe addiƟonalrisk/costs thatLessor willincurby reasonof Lessee'sfailure tomaintainthe requiredinsurance. Suchincrease inBase Rentshallin noevent consƟtutea waiverof Lessee'sDefault orBreachwith respectto thefailure tomaintainsuch insurance,prevent theexerciseof anyof theotherrights andremedies granted hereunder,nor relieveLessee ofits obligaƟon tomaintain theinsurance specifiedinthis Lease.

9. Damageor DestrucƟon.

9.1 DefiniƟons.
(a) "Premises ParƟalDamage" shallmeandamage or destrucƟon tothe improvementsonthe Premises,other thanLesseeOwned AlteraƟonsand UƟlity InstallaƟons,which canreasonably berepairedin 6months orless fromthedate ofthe damageor destrucƟon. Lessor shall noƟfyLessee in wriƟng within30 days fromthe dateof thedamageor destrucƟonas towhether ornotthe damageis ParƟalorTotal. (b) "PremisesTotal DestrucƟon"shall meandamageor destrucƟonto thePremises,other thanLessee Owned AlteraƟons and UƟlity InstallaƟons and TradeFixtures, whichcannot reasonablyberepaired in6 monthsor lessfromthe dateof thedamageor destrucƟon. Lessorshall noƟfy Lesseein wriƟngwithin 30 daysfrom thedate ofthedamage or destrucƟon asto whetherornot thedamage is ParƟalor Total. (c) "InsuredLoss" shallmean damageor destrucƟon toimprovements onthe Premises,otherthan LesseeOwned AlteraƟonsand UƟlity InstallaƟonsand TradeFixtures, whichwas causedbyan eventrequired tobe coveredbythe insurancedescribed inParagraph8.3(a), irrespecƟveof any deducƟbleamounts or coveragelimits involved.
(d) "ReplacementCost" shallmean thecostto repairor rebuildtheimprovements ownedby Lessorat the Ɵmeof theoccurrence totheir condiƟon exisƟngimmediately priorthereto, including demoliƟon,debris removaland upgradingrequired bythe operaƟon ofApplicable Requirements,andwithout deducƟon for depreciaƟon.

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(e) "Hazardous Substance CondiƟon"shall meanthe occurrenceordiscovery ofa condiƟoninvolvingthe presenceof,ora contaminaƟonby,a HazardousSubstance, in,on, orunderthe Premiseswhich requires restoraƟon.

9.2 ParƟal Damage- InsuredLoss. Ifa Premises ParƟal Damagethatis anInsured Lossoccurs,then Lessorshall, atLessor's expense,repairsuch damage(but notLessee's TradeFixtures orLesseeOwned AlteraƟonsand UƟlity InstallaƟons) assoonas reasonablypossible andthisLease shall conƟnue infullforce and effect; provided,however,thatLessee shall,atLessor's elecƟon,make therepair ofanydamage ordestrucƟon thetotalcost torepair ofwhichis $10,000or less,and, insuch event,Lessor shallmake anyapplicableinsurance proceedsavailable toLessee onareasonable basisfor thatpurpose. Notwithstandingthe foregoing,ifthe required insurancewas notin forceorthe insuranceproceeds arenot sufficientto effect suchrepair,theInsuringParty shallpromptly contributetheshortage inproceeds (exceptas tothe deducƟblewhichis Lessee'sresponsibility) asand whenrequiredto completesaid repairs. Inthe event,however,such shortagewas dueto thefact that,by reasonof theuniquenature ofthe improvements,full replacementcostinsurance coveragewas notcommerciallyreasonable andavailable, Lessorshallhave no obligaƟon topay fortheshortage ininsurance proceedsor tofullyrestore theunique aspectsofthe Premisesunless LesseeprovidesLessor withthe fundsto cover same,or adequateassurance thereof,within10 daysfollowing receiptof wriƩen noƟceof suchshortage andrequesttherefor. If Lessorreceivessaid fundsor adequateassurance thereofwithin said10day period,the partyresponsible formakingthe repairsshall completethemas soonas reasonablypossibleand thisLease shallremain infull forceand effect. If suchfunds orassuranceare notreceived, Lessormaynevertheless electby wriƩen noƟceto Lesseewithin 10days thereaŌer to: (i)make such restoraƟonand repairas iscommercially reasonablewithLessor payingany shortageinproceeds, inwhich casethisLease shallremain infull force and effect, or(ii) havethisLease terminate30 days thereaŌer. Lesseeshall notbe enƟtledtoreimbursement ofany fundscontributedby Lesseeto repairany such damageor destrucƟon. Premises ParƟalDamage dueto floodor earthquakeshallbe subjectto Paragraph9.3,notwithstanding thatthere maybesome insurance coverage,but thenet proceedsofany suchinsurance shallbe madeavailablefor therepairs ifmadeby eitherParty.

9.3 ParƟal Damage- UninsuredLoss. Ifa Premises ParƟal Damagethatis notan InsuredLossoccurs,unlesscaused bya negligentorwillful actof Lessee(in whichevent Lesseeshall maketherepairs atLessee's expense),Lessor mayeither: (i)repair suchdamageas soonas reasonablypossibleat Lessor'sexpense, inwhich eventthis Leaseshall conƟnueinfull forceand effect,or (ii)terminatethis Leaseby givingwriƩen noƟce toLessee within30days aŌerreceipt byLessor ofknowledge ofthe occurrenceof suchdamage. Such terminaƟon shallbe effecƟve60days followingthe dateofsuch noƟce. Intheevent Lessorelects toterminate thisLease, Lesseeshall havethe rightwithin10 days aŌer receiptof the terminaƟon noƟce togive wriƩennoƟceto Lessorof Lessee'scommitmentto payfor therepair ofsuch damagewithout reimbursementfrom Lessor. Lessee shallprovide Lessorwith saidfundsor saƟsfactoryassurance thereofwithin30 days aŌer makingsuch commitment. Insuch eventthisLease shall conƟnue infull forceand effect, andLessor shallproceedto makesuch repairsassoon asreasonably possible aŌer the requiredfunds areavailable. IfLessee doesnot makethe requiredcommitment,this Leaseshall terminateasof thedate specifiedinthe terminaƟon noƟce.

9.4 Total DestrucƟon. Notwithstandingany otherprovisionhereof,ifa PremisesTotalDestrucƟon occurs,this Leaseshallterminate 60days followingsuch DestrucƟon. Ifthe damageor destrucƟon wascaused bythe grossnegligenceor willfulmisconduct ofLessee,Lessor shallhave therightto recoverLessor's damages fromLessee, exceptas providedinParagraph 8.6.

9.5 Damage NearEnd ofTerm. Ifat any Ɵme duringthelast 6months ofthisLease thereis damagefor whichthecost torepair exceedsonemonth's Base Rent,whether ornot anInsuredLoss, Lessormay terminatethis Lease effecƟve60 daysfollowing thedateof occurrenceof suchdamageby givinga wriƩen terminaƟon noƟce toLessee within30days aŌerthe dateof occurrenceofsuch damage. Notwithstandingtheforegoing, ifLessee atthat Ɵme hasan exercisable opƟonto extendthis Leaseorto purchasethe Premises,then Lesseemaypreserve thisLease by,(a)exercising such opƟon and(b)providing Lessorwith anyshortage ininsurance proceeds(or adequateassurancethereof) neededto makethe repairsonor beforethe earlierof(i) thedate whichis10 days aŌer Lessee'sreceipt of Lessor's wriƩen noƟce purporƟng toterminatethis Lease,or (ii)the daypriorto thedate uponwhichsuch opƟonexpires. IfLessee dulyexercises such opƟon during suchperiod andprovides Lessorwithfunds (oradequate assurancethereof) tocoverany shortagein insuranceproceeds,Lessor shall,at Lessor'scommercially reasonableexpense, repairsuch damageassoon asreasonably possibleand thisLeaseshall conƟnuein fullforceand effect. IfLesseefails toexercise such opƟon and providesuch fundsor assuranceduringsuch period,then thisLease shallterminateon thedate specifiedinthe terminaƟon noƟce andLessee's opƟon shallbe exƟnguished.

9.6 Abatement ofRent; Lessee'sRemedies.
(a) Abatement. In theeventof Premises ParƟal Damageor PremisesTotalDestrucƟon ora HazardousSubstance CondiƟon forwhich Lesseeisnot responsibleunder thisLease, theRentpayable byLessee forthe periodrequiredfor therepair,remediaƟonor restoraƟon ofsuch damageshallbe abatedin proporƟonto thedegree towhichLessee's useof thePremises isimpaired,but notto exceedtheproceeds receivedfrom theRentalValueinsurance. Allother obligaƟonsof Lesseehereunder shallbeperformed byLessee, andLessor shallhaveno liabilityfor anysuchdamage, destrucƟon, remediaƟon, repairor restoraƟon exceptas providedherein.
(b) Remedies. IfLessor isobligatedto repairor restorethePremises anddoes notcommence, ina substanƟal andmeaningful way,suchrepair or restoraƟonwithin 90days aŌersuch obligaƟon shallaccrue, Lesseemay,atany Ɵme priorto thecommencementof suchrepair or restoraƟon,give wriƩen noƟce to Lessorand toany Lendersofwhich Lesseehas actual noƟce, ofLessee's elecƟon toterminate thisLeaseon adate notlessthan 60days followingthe givingofsuch noƟce. IfLessee givessuch noƟce andsuch repairor restoraƟonisnot commencedwithin 30days thereaŌer ,thisLease shallterminateas ofthe date specified insaid noƟce. Ifthe repairor restoraƟoniscommenced withinsuch 30days,this Leaseshall conƟnueinfull forceand effect. "Commence" shallmean eitherthe uncondiƟonal authorizaƟon ofthe preparaƟonofthe requiredplans, orthe beginningofthe actualwork onthePremises, whichever first occurs.

9.7 TerminaƟon;AdvancePayments. Upon terminaƟonofthis Leasepursuant toParagraph6.2(g) orParagraph9,anequitable adjustmentshall bemade concerningadvance BaseRent andanyother advancepayments madeby LesseetoLessor. Lessor shall,in addiƟon, returnto Lesseesomuch ofLessee's Security Depositas hasnot been,oris notthen requiredto be,usedby Lessor.

10. Real PropertyTaxes.

10.1 DefiniƟon. Asused herein,the term"RealProperty Taxes"shall includeanyform ofassessment; realestate,general, special,ordinary orextraordinary,or rentallevy ortax (otherthaninheritance, personalincome orestatetaxes);improvementbond; and/orlicense feeimposedupon orlevied againstanylegal or equitableinterest ofLessor inthePremises orthe Project,Lessor's righttoother incometherefrom, and/orLessor'sbusiness ofleasing, byanyauthority havingthe director indirectpower totaxand wherethe fundsare generatedwithreference tothe Buildingaddress. RealProperty Taxesshallalso includeany tax,fee, levy, assessmentor charge,or anyincreasetherein: (i)imposed byreason ofeventsoccurring duringthe termofthis Lease,including butnotlimited to,a changein the ownershipof thePremises, and(ii)levied orassessed onmachinery orequipmentprovided byLessor toLesseepursuant tothis Lease.

10.2 Payment ofTaxes. Lessorshall paytheReal PropertyTaxesapplicabletothe Premisesprovided, however,thatLessee shallpay toLessor theamount,if any,by whichReal PropertyTaxesapplicable tothe Premisesincrease overthe fiscal taxyear duringwhichthe CommencementDate OccursPremisesisfully assessed("TaxIncrease"). Paymentof anysuchTaxIncreaseshall bemadeby Lesseeto Lessorwithin 30days aŌer receiptof Lessor's wriƩenstatement seƫng forththe amountdue and computaƟonthereof. If anysuch taxesshallcover anyperiod of Ɵmeprior toor aŌerthe expiraƟon or terminaƟon ofthis Lease,Lessee's shareof suchtaxes shallbeprorated tocover onlythat porƟonofthe taxbill applicabletothe periodthat thisLeaseis in effect. In theeventLessee incursa late chargeon anyRent payment,Lessormay esƟmatethe currentReal PropertyTaxes,and requirethat theTaxIncrease bepaid inadvanceto Lessorby Lesseemonthly in

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advancewith thepayment oftheBase Rent. Suchmonthly paymentshallbe anamount equaltothe amountof the esƟmatedinstallment ofthe TaxIncrease divided bythe numberof monthsremainingbefore themonth inwhich saidinstallmentbecomes delinquent. Whentheactual amountof theapplicableTaxIncreaseis known,the amountof suchequalmonthly advancepayments shallbe adjustedasrequired toprovide thefundsneeded topay theapplicableTaxIncrease. Ifthe amountcollected byLessor is insufficientto paythe TaxIncrease whendue,Lessee shallpay Lessor,upondemand, such addiƟonal sumsasare necessaryto paysuch obligaƟons. Advancepayments maybeintermingled withother moneysof Lessorandshall notbear interest. In theevent ofaBreach byLessee inthe performance ofits obligaƟonsunder thisLease,then anysuch advancepayments maybetreated byLessor asan addiƟonal SecurityDeposit.

10.3 AddiƟonal Improvements. Notwithstanding anythingto thecontraryin thisParagraph10.2,Lesseeshall payto Lessorupondemand thereforthe enƟrety ofany increasein RealPropertyTaxesassessedby reasonof AlteraƟonsor UƟlity InstallaƟonsplaced uponthePremises byLessee oratLessee's requestor byreason ofany alteraƟonsor improvementstothe Premisesmade byLessor subsequenttothe execuƟonof thisLeaseby the ParƟes.

10.4 Joint Assessment. If thePremises arenotseparately assessed,Lessee's liabilityshallbe anequitable proporƟonofthe TaxIncrease forall oftheland and improvementsincluded withinthe taxparcelassessed, such proporƟon tobe conclusivelydeterminedby Lessorfrom the respecƟve valuaƟons assignedin the assessor'swork sheetsor suchother informaƟon asmay bereasonably available.

10.5 Personal PropertyTaxes. Lesseeshall pay,priorto delinquency,all taxesassessedagainst andlevied uponLesseeOwned AlteraƟons, UƟlity InstallaƟons, TradeFixtures, furnishings,equipment andallpersonal propertyof Lessee. Whenpossible,Lessee shallcause itsLesseeOwned AlteraƟonsand UƟlity InstallaƟons, TradeFixtures, furnishings,equipment andallother personalproperty tobe assessedandbilled separatelyfrom therealproperty ofLessor. Ifany ofLessee's said propertyshall beassessed withLessor'sreal property,Lessee shallpay Lessorthetaxes aƩributableto Lessee'spropertywithin 10days aŌerreceiptof a wriƩen statement seƫng forththe taxesapplicableto Lessee'sproperty.

11. UƟliƟes andServices.

11.1 Lessee shallpayfor allwater,gas,heat,light, power,telephone, trashdisposaland other uƟliƟes andservicessupplied tothe Premises,together withany taxesthereon. If anysuchservices arenot separatelymetered orbilledto Lessee,Lessee shallpaya reasonable proporƟon, tobedetermined byLessor,ofall charges jointlymetered orbilled. Thereshall beno abatementof rentandLessor shallnot beliablein anyrespect whatsoeverforthe inadequacy,stoppage, interrupƟonor disconƟnuanceof any uƟlity orservicedue toriot, strike,labor dispute,breakdown,accident, repairor othercausebeyond Lessor'sreasonable controlorin cooperaƟonwith governmentalrequest or direcƟons.

11.2 Within fiŌeendaysof Lessor's wriƩen request,Lesseeagrees todeliver toLessorsuch informaƟon,documents and/or authorizaƟonas Lessorneeds in orderfor Lessorto complywithnew or exisƟng ApplicableRequirements relaƟngtocommercial buildingenergy usage, raƟngs,and/or the reporƟng thereof.

12. Assignment and Subleƫng.

12.1 Lessor's ConsentRequired.
(a) Lessee shallnot voluntarilyorby operaƟonof lawassign, transfer,mortgageor encumber(collecƟvely, "assignorassignment") orsublet allorany partof Lessee'sinterest inthisLease orin thePremises withoutLessor'sprior wriƩenconsent. (b) UnlessLessee isa corporaƟonandits stockis publiclytradedon a naƟonal stockexchange, achangein thecontrol ofLesseeshall consƟtutean assignmentrequiring consent. Thetransfer,on a cumulaƟve basis,of 25%ormore ofthe voƟngcontrolof Lesseeshall consƟtuteachange incontrol forthis purpose. (c) Theinvolvement ofLessee oritsassets inany transacƟon,or seriesof transacƟons (byway ofmerger,sale, acquisiƟon, financing, transfer,leveraged buyoutor otherwise), whether ornota formalassignment or hypothecaƟon ofthisLease orLessee's assetsoccurs,which resultsor willresultin a reducƟon ofthe NetWorthofLessee byanamount greaterthan 25%of suchNetWorth asit wasrepresentedat the Ɵme ofthe execuƟon ofthis Leaseor atthe Ɵme ofthe most recentassignment towhich Lessorhasconsented, oras itexists immediatelypriorto said transacƟon or transacƟons consƟtuƟng such reducƟon, whicheverwasor is greater,shall beconsidered anassignmentof thisLease towhich Lessormaywithhold itsconsent. "NetWorth ofLessee" shallmeanthe networth ofLessee (excludingany guarantors)established undergenerallyaccepted accounƟngprinciples. (d) Anassignment or subleƫng withoutconsentshall, atLessor's opƟon,bea Defaultcurable aŌer noƟce perParagraph13.1(d), ora non-curableBreach withoutthe necessityof any noƟceand graceperiod. If Lessorelectsto treatsuch unapprovedassignmentor subleƫngas anon-curableBreach, Lessormay either:
(i)terminate thisLease, or(ii)upon 30days wriƩen noƟce, increasethemonthly BaseRent to110%of theBase Rentthenin effect. Further,in theeventof such Breachand rentaladjustment, (i)thepurchase priceof any opƟon topurchasethe Premisesheld byLesseeshall besubject tosimilaradjustment to110% ofthe price previouslyin effect,and (ii)all fixed andnon-fixed rentaladjustments scheduledduringthe remainderof theLeaseterm shallbe increasedto110% ofthe scheduled adjustedrent.
(e) Lessee's remedyforany breachof Paragraph12.1 byLessorshall belimited tocompensatorydamages and/or injuncƟve relief. (f) Lessor mayreasonablywithhold consentto aproposedassignment or subleƫng ifLesseeis inDefault atthe Ɵmeconsentis requested. (g) Notwithstanding theforegoing, allowinga deminimis porƟon ofthe Premises,i.e.20 squarefeet orless,to beused bya thirdpartyvendor in connecƟonwith the installaƟon ofavending machineor payphoneshall not consƟtutea subleƫng.

12.2 Termsand CondiƟonsApplicable toAssignment and Subleƫng. (a) Regardless ofLessor's consent,noassignment or subleƫng shall: (i)be effecƟvewithoutthe express wriƩen assumpƟon bysuch assigneeor sublesseeof the obligaƟons ofLesseeunder thisLease, (ii)release Lesseeofany obligaƟonshereunder,or(iii)alter theprimary liabilityofLessee forthe paymentof Rentor forthe performanceofany other obligaƟons tobe performedbyLessee. (b) Lessormay acceptRent orperformanceof Lessee's obligaƟons fromanyperson otherthan Lesseepending approvalordisapproval ofan assignment.

Neithera delayin theapprovalor disapprovalof suchassignment northeacceptance ofRent orperformanceshall consƟtutea waiverorestoppel ofLessor's rightto exerciseits remediesfor Lessee'sDefaultor Breach.
(c) Lessor'sconsent toany assignmentor subleƫng shallnot consƟtutea consenttoany subsequentassignment or subleƫng. (d) Inthe eventof anyDefaultor Breachby Lessee,Lessormay proceeddirectly againstLessee, anyGuarantorsor anyoneelse responsibleforthe performanceof Lessee's obligaƟons underthisLease, includingany assigneeor sublessee, without first exhausƟngLessor's remediesagainstany otherperson or enƟtyresponsible thereforto Lessor,orany securityheld byLessor. (e) Each requestforconsent toan assignmentor subleƫngshallbe in wriƟng, accompaniedbyinformaƟon relevantto Lessor's determinaƟonas tothe financialand operaƟonalresponsibility andappropriatenessof theproposed assigneeor sublessee,includingbut notlimited totheintended useand/or required modificaƟonof thePremises, ifany,together witha feeof $500as consideraƟon forLessor's consideringandprocessing saidrequest. Lesseeagrees toprovide Lessor withsuch otheror addiƟonal informaƟonand/or documentaƟonas maybe reasonablyrequested.(See alsoParagraph36) (f) Any assigneeof,or sublesseeunder,thisLeaseshall, byreason of accepƟngsuch assignment,entering intosuch sublease,orentering intopossession ofthe Premisesor any porƟonthereof,bedeemed tohave assumedandagreed toconform andcomplywith eachand everyterm,covenant, condiƟonand obligaƟon hereinto beobserved orperformedby Lesseeduring theterm ofsaidassignment orsublease, otherthansuch obligaƟonsas arecontraryto orinconsistent with provisionsof anassignment orsubleaseto whichLessor has specifically consentedtoin wriƟng.

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(g) Lessor's consentto anyassignmentor subleƫngshall nottransferto theassignee orsublessee any OpƟongranted tothe originalLesseeby thisLease unlesssuch transferis specificallyconsentedto byLessor in wriƟng. (SeeParagraph39.2)

12.3 AddiƟonal Termsand CondiƟons Applicableto Subleƫng. The followingterms and condiƟonsshall applyto any subleƫngby Lesseeof allor anypartof thePremises andshall bedeemedincluded inall subleasesunder thisLeasewhether ornot expresslyincorporatedtherein:
(a) Lessee herebyassigns andtransfersto Lessorall ofLessee's interestinall Rentpayable onanysublease, andLessor maycollectsuch Rentand apply sametoward Lessee's obligaƟons underthisLease; provided,however,that unƟl aBreachshall occurin theperformanceof Lessee's obligaƟons, Lesseemaycollect saidRent. In theeventthat theamount collectedby LessorexceedsLessee's thenoutstanding obligaƟonsanysuch excessshall berefundedto Lessee. Lessorshall not,by reasonof theforegoingor anyassignment ofsuch sublease,norby reasonof the collecƟonof Rent,be deemedliableto thesublessee forany failureofLessee toperform andcomply withanyof Lessee's obligaƟons tosuch sublessee. Lessee herebyirrevocably authorizesanddirects anysuch sublessee,uponreceipt ofa wriƩen noƟce fromLessor staƟngthata Breachexists inthe performanceofLessee's obligaƟonsunder thisLease,to payto LessorallRent dueand tobecome due underthe sublease. Sublesseeshallrely uponany such noƟce fromLessorand shallpay allRentsto Lessorwithout any obligaƟonor rightto inquireas towhether suchBreach exists,notwithstanding anyclaimfrom Lesseeto thecontrary. (b) Inthe eventofa Breachby Lessee,Lessor may,atits opƟon,require sublesseeto aƩorn toLessor,inwhichevent Lessorshall undertakethe obligaƟonsof thesublessor undersuchsublease fromthe Ɵmeof theexerciseof said opƟon tothe expiraƟon ofsuch sublease;provided,however,Lessorshall notbe liablefor anyprepaid rentsorsecurity depositpaid bysuch sublesseetosuch sublessoror foranyprior Defaultsor Breachesofsuch sublessor. (c) Any maƩer requiringthe consentofthe sublessorunder asublease shallalsorequire theconsent ofLessor. (d) Nosublessee shallfurther assignorsublet allor anypartof thePremises withoutLessor's prior wriƩenconsent. (e) Lessor shalldelivera copyof any noƟce ofDefaultor Breachby Lesseetothe sublessee,who shallhavethe rightto curethe DefaultofLessee within thegrace period,if any, specifiedin such noƟce. The sublesseeshallhave aright ofreimbursementand offsetfrom andagainstLessee forany suchDefaults curedby thesublessee.

13. Default; Breach;Remedies.

13.1 Default; Breach. A "Default"is definedasa failureby theLesseeto complywith orperformany ofthe terms,covenants, condiƟonsorRules and RegulaƟonsunder thisLease. A"Breach" is defined asthe occurrenceofone ormore ofthefollowing Defaults,and thefailureof Lesseeto curesuch Defaultwithin anyapplicable graceperiod:
(a) The abandonmentof thePremises;the vacaƟngof thePremises priortothe expiraƟonor terminaƟonofthis Leasewithout providingacommercially reasonablelevel ofsecurity,orwherethe coverageof theproperty insurancedescribedin Paragraph8.3 isjeopardizedas aresult thereof,orwithout providing reasonableassurances tominimize potenƟalvandalism;or failureto deliverto Lessorexclusivepossession ofthe enƟrePremisesin accordanceherewith priortothe expiraƟonor terminaƟonof thisLease.
(b) Thefailure ofLessee tomakeany paymentof Rentorany SecurityDeposit requiredto bemadeby Lesseehereunder,whethertoLessor orto athird party,when due,to providereasonableevidence ofinsurance orsurety bond,orto fulfillany obligaƟonunderthis Leasewhich endangersorthreatens lifeor property,where suchfailure conƟnuesfora periodof 3business daysfollowing wriƩen noƟceto Lessee. THE ACCEPTANCEBY LESSOROFA PARTIALPAYMENTOF

RENTOR SECURITYDEPOSIT SHALLNOTCONSTITUTE AWAIVER OFANY OFLESSOR'SRIGHTS, INCLUDINGLESSOR'S RIGHTTORECOVER POSSESSIONOF THE PREMISES.
(c) Thefailure ofLessee toallowLessor and/orits agentsaccess tothePremises orthe commissionofwaste, actor acts consƟtuƟngpublic orprivate nuisance,and/or anillegal acƟvityonthe Premisesby Lessee,where such acƟons conƟnue fora periodof3 businessdays following wriƩen noƟce toLessee. In the eventthat Lesseecommits waste,anuisance oran illegal acƟvity asecond Ɵme then,the Lessormayelect totreat suchconductas anon-curable Breachrather thana Default.
(d) Thefailure byLessee toprovide(i) reasonable wriƩen evidenceofcompliance withApplicable Requirements,(ii) theservicecontracts, (iii)the rescissionof anunauthorized assignmentor subleƫng, (iv)an Estoppel CerƟficate or financialstatements, (v)a requested subordinaƟon,(vi) evidenceconcerning any guarantyand/or Guarantor,(vii) anydocumentrequested underParagraph 42,(viii) materialsafetydata sheets(MSDS), or(ix)any other documentaƟon or informaƟonwhich Lessormay reasonablyrequireof Lesseeunder theterms ofthisLease, whereany suchfailure conƟnues fora periodof10 daysfollowing wriƩen noƟceto Lessee.
(e) A DefaultbyLessee asto theterms, covenants, condiƟonsor provisionsof thisLease,or ofthe rulesadoptedunder Paragraph40 hereof,other than thosedescribed insubparagraphs 13.1(a),(b),(c) or(d), above,where suchDefault conƟnues fora periodof30 days aŌer wriƩen noƟce;provided, however,that if thenature ofLessee's Defaultissuch thatmore than30 daysarereasonably requiredfor itscure,then itshall notbedeemed tobe aBreach ifLesseecommences suchcure withinsaid 30dayperiod and thereaŌer diligentlyprosecutes suchcureto compleƟon. (f) The occurrenceofany ofthe followingevents: (i)the makingofany generalarrangement orassignment forthe benefit ofcreditors; (ii)becominga "debtor"as definedin 11U.S.C.§ 101or anysuccessor statutethereto(unless, inthe caseofa peƟƟon filed againstLessee,the sameis dismissedwithin 60days);(iii) theappointment ofa trusteeorreceiver totakepossessionof substanƟallyallof Lessee'sassets locatedatthe Premisesor ofLessee'sinterest inthis Lease,where possessionis notrestored toLesseewithin 30days; or(iv) the aƩachment, execuƟon orother judicialseizureof substanƟallyall ofLessee'sassets locatedat the Premisesor ofLessee's interestinthis Lease,where suchseizure isnotdischarged within30 days;provided,however,inthe eventthatany provisionof this subparagraphis contraryto anyapplicablelaw,suchprovision shallbe ofnoforce or effect, andnot affect thevalidity oftheremaining provisions. (g) The discoverythat any financial statementofLessee orof anyGuarantorgiven toLessor wasmateriallyfalse. (h) Ifthe performanceof Lessee's obligaƟonsunder thisLease isguaranteed: (i)the deathof aGuarantor,(ii) the terminaƟon ofaGuarantor's liability withrespect tothis Leaseotherthan inaccordance withthe termsofsuch guaranty,(iii) aGuarantor'sbecoming insolventor thesubjectof abankruptcy filing,(iv) a Guarantor'srefusal tohonor theguaranty,or (v)a Guarantor'sbreach ofitsguaranty obligaƟonon an anƟcipatorybasis, andLessee's failure,within60 daysfollowing wriƩen noƟce ofany suchevent,to provide wriƩen alternaƟveassurance orsecurity,which, whencoupled withthethen exisƟngresources ofLessee,equals or exceedsthe combined financial resourcesofLessee andthe Guarantorsthat existedatthe Ɵmeof execuƟonofthis Lease.

13.2 Remedies. IfLessee failsto performanyof its affirmaƟve duƟesor obligaƟons, within10 days aŌer wriƩen noƟce(or incase ofanemergency,without noƟce),Lessor may,at its opƟon,perform suchduty or obligaƟon onLessee'sbehalf,includingbut notlimitedto theobtaining ofreasonablyrequired bonds, insurancepolicies, orgovernmental licenses,permitsor approvals. Lesseeshall paytoLessor anamount equalto115% ofthe costsandexpenses incurredby Lessor insuch performanceupon receiptofan invoicetherefor. In theeventof aBreach, Lessormay,with orwithout further noƟceor demand,and without limiƟng Lessor inthe exerciseof anyrightor remedywhich Lessormay havebyreason ofsuch Breach:
(a) TerminateLessee'sright topossessionof thePremises byany lawfulmeans,in whichcase thisLeaseshall terminateand Lesseeshallimmediately surrenderpossession toLessor. Insuch eventLessor shallbe enƟtledtorecover fromLessee: (i)the unpaidRent whichhadbeen earnedat the Ɵme of terminaƟon; (ii)the worthat the Ɵmeof awardof theamount bywhichthe unpaidrent whichwouldhave beenearned aŌer terminaƟon unƟl the Ɵme ofaward exceedsthe

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amountof suchrental lossthatthe Lesseeproves couldhave beenreasonablyavoided; (iii)the worthatthe Ɵmeof awardofthe amountby whichthe unpaidrentfor thebalance ofthe term aŌerthe Ɵmeof awardexceedstheamountof suchrental lossthatthe Lesseeproves couldbereasonably avoided;and (iv)any otheramount necessaryto compensateLessor forallthe detrimentproximately causedby theLessee'sfailure toperform its obligaƟonsunder thisLease orwhichin theordinary courseof thingswould belikelyto resulttherefrom, includingbut notlimitedto thecost ofrecoveringpossession ofthe Premises,expensesof releƫng,including necessary renovaƟon and alteraƟon ofthePremises, reasonable aƩorneys' fees,and that porƟonof anyleasing commissionpaidby Lessorin connecƟonwiththis Leaseapplicable tothe unexpiredtermof thisLease. The worthatthe Ɵmeof awardofthe amountreferredtoinprovision (iii)of theimmediately preceding sentenceshall becomputed by discounƟngsuch amountat thediscount rateofthe FederalReserve Bankofthe Districtwithin whichthePremises arelocated atthe Ɵmeof awardplus onepercent. Effortsby Lessorto miƟgatedamagescaused byLessee's Breachofthis Leaseshall notwaiveLessor's rightto recoverany damagesto whichLessor isotherwise enƟtled. If terminaƟonof thisLease isobtainedthrough theprovisional remedyofunlawful detainer,Lessor shallhavethe rightto recover insuch proceedingany unpaidRentand damagesas arerecoverable therein,orLessor mayreserve therightto recoverall oranypart thereofin aseparate suit. If a noƟceand graceperiod requiredunderParagraph13.1was notpreviously given,a noƟce topay rentorquit, orto performorquit givento Lesseeunder theunlawful detainerstatute shallalso consƟtutethe noƟce requiredby Paragraph13.1. Insuch case,the applicablegraceperiod requiredby Paragraph13.1and theunlawful detainerstatute shallrun concurrently,andthe failureof Lesseeto curetheDefault withinthe greaterofthe twosuch graceperiodsshall consƟtuteboth anunlawful detainerand aBreach ofthisLease enƟtlingLessor tothe remediesprovidedfor inthis Leaseand/orby saidstatute. (b) ConƟnuethe Leaseand Lessee'srightto possessionand recovertheRent asit becomesdue, inwhichevent Lesseemay subletorassign, subjectonly toreasonable limitaƟons. Actsofmaintenance, effortsto relet,and/or theappointmentof areceiver toprotectthe Lessor'sinterests, shallnot consƟtute a terminaƟonof theLessee's righttopossession.
(c) Pursueany otherremedy nowor hereaŌer availableunder thelaws orjudicialdecisions ofthe statewhereinthe Premisesare located. The expiraƟon or terminaƟon ofthis Leaseand/orthe terminaƟonof Lessee'sright topossessionshall notrelieve Lesseefromliability underany indemnityprovisionsof thisLease asto maƩersoccurring oraccruingduring theterm hereofor byreasonof Lessee'soccupancy ofthePremises.

13.3 Inducement Recapture. Any agreementfor freeorabated rentor othercharges,the costof tenantimprovementsfor Lesseepaid foror performedby Lessor,or forthe givingorpaying byLessor toor forLesseeof anycash orotherbonus, inducementor consideraƟonforLessee's enteringinto thisLease, allofwhich concessionsare hereinaŌerreferredtoas"Inducement Provisions,"shall bedeemed condiƟoneduponLessee's fulland faithfulperformanceof allof theterms, covenantsand condiƟonsof thisLease. UponBreach ofthis LeasebyLessee, anysuch InducementProvisionshall automaƟcallybe deemeddeletedfrom thisLease andof nofurther forceor effect, andany rent,other charge,bonus,inducement or consideraƟon theretoforeabated,given orpaid byLessorunder suchan InducementProvision shallbe immediatelydueand payableby Lesseeto Lessor,notwithstandingany subsequentcure ofsaidBreach byLessee. Theacceptance by Lessorof rentor thecureof theBreach which iniƟated the operaƟonof thisparagraph shallnotbe deemeda waiverbyLessor ofthe provisionsof thisparagraph unless specifically sostated in wriƟngby Lessorat the Ɵme ofsuchacceptance.

13.4 Late Charges. Lessee herebyacknowledges thatlatepayment byLessee ofRentwill causeLessor toincurcosts notcontemplated bythis Lease,theexact amountof whichwill beextremely difficult toascertain. Such costsinclude,but arenot limitedto,processing and accounƟng charges,andlate chargeswhich maybe imposedupon Lessorby anyLender. Accordingly,if anyRent shallnotbe receivedby Lessorwithin5 days aŌer suchamountshall bedue, then,without any requirementfor noƟceto Lessee,Lesseeshall immediatelypay toLessor aone-Ɵmelate chargeequal to10%of eachsuch overdueamountor $100,whichever is greater. The ParƟes herebyagreethat suchlate chargerepresents afairand reasonable esƟmate ofthecosts Lessorwill incurbyreason ofsuch latepayment.

Acceptanceof suchlate chargebyLessor shallin noevent consƟtuteawaiver ofLessee's DefaultorBreach withrespect tosuchoverdue amount,nor preventthe exerciseof anyof theotherrights andremedies grantedhereunder. Inthe eventthat alatecharge ispayable hereunder,whetheror notcollected, for3 consecuƟve installmentsof BaseRent, thennotwithstandingany provisionof thisLease tothecontrary,BaseRent shall,atLessor's opƟon,become dueandpayable quarterlyin advance.

13.5 Interest. Anymonetary paymentdue Lessorhereunder,other thanlate charges,notreceived byLessor,whendueshall bearinterest fromthe 31stday aŌerit wasdue. Theinterest ("Interest")charged shallbe computedatthe rateof 10%perannum butshall notexceedthe maximumrate allowedby law. Interest is payablein addiƟonto the potenƟallate chargeprovided forin Paragraph13.4.

13.6 Breach byLessor.
(a) NoƟce ofBreach. Lessorshall notbe deemedin breachofthis Leaseunless Lessorfailswithin areasonable Ɵmetoperform an obligaƟon requiredto beperformed byLessor. Forpurposes ofthis Paragraph,a reasonable Ɵmeshall inno eventbeless than30 days aŌerreceipt byLessor,andany Lenderwhosename andaddress shallhave beenfurnishedto Lesseein wriƟngfor suchpurpose,of wriƩen noƟce specifyingwhereinsuch obligaƟonof Lessorhasnot beenperformed; provided,however,thatif thenatureof Lessor's obligaƟon issuch thatmorethan 30days arereasonablyrequired forits performance,thenLessor shallnot bein breachif performanceis commencedwithinsuch 30day periodand thereaŌerdiligentlypursued tocompleƟon. (b) Performanceby Lesseeon BehalfofLessor. In theeventthat neitherLessor norLender curessaidbreach within30 days aŌerreceipt ofsaid noƟce, orif havingcommenced saidcurethey donot diligentlypursue itto compleƟon, thenLessee mayelectto curesaid breachatLessee's expenseand offsetfrom Rent theactual andreasonable costtoperform suchcure, providedhowever,thatsuch offset shallnot exceedanamount equalto thegreaterof onemonth's BaseRent or theSecurity Deposit,reserving Lessee'srightto seekreimbursement fromLessor foranysuch expensein excessofsuch offset. Lesseeshalldocument thecost ofsaid cureand supplysaid documentaƟontoLessor.

14. CondemnaƟon. If thePremisesor any porƟon thereofaretakenunderthe powerof eminentdomainor soldunder thethreatof theexercise ofsaidpower (collecƟvely"CondemnaƟon"), thisLease shallterminateas tothe parttakenasofthe datethe condemningauthoritytakes Ɵtleor possession,whichever first occurs.

Ifmore than10% oftheBuilding, ormore than25% ofthat porƟon ofthe Premisesnotoccupied byany building,istaken by CondemnaƟon, Lesseemay,atLessee's opƟon,to beexercisedin wriƟngwithin 10days aŌerLessor shallhavegiven Lessee wriƩen noƟceofsuch taking(or intheabsence ofsuch noƟce,within 10days aŌerthe condemningauthority shallhavetakenpossession)terminate thisLease asofthe datethe condemningauthoritytakes suchpossession. IfLessee doesnot terminatethis Leasein accordancewiththe foregoing,this Leaseshall remaininfull forceand effectasto the porƟon ofthePremises remaining,except thatthe Base Rentshall bereduced in proporƟonto the reducƟon in uƟlity ofthePremises causedby suchCondemnaƟon. CondemnaƟonawards and/orpaymentsshall bethe propertyof Lessor,whether suchawardshall bemade as compensaƟon for diminuƟon in valueof theleasehold,the valueof theparttaken, orfor severance damages;provided, however,that Lesseeshallbe enƟtledto any compensaƟon paidbythe condemnorfor Lessee's relocaƟonexpenses, lossof businessgoodwill and/orTradeFixtures,without regardtowhether ornot thisLease isterminatedpursuant tothe provisionsofthis Paragraph. All AlteraƟonsand UƟlity InstallaƟons madeto thePremises byLessee,for purposesof CondemnaƟononly,shallbeconsidered theproperty oftheLessee andLessee shallbe enƟtled toany andall compensaƟonwhich ispayable therefor. In theevent thatthis Leaseisnot terminatedby reasonofthe CondemnaƟon,Lessor shallrepairany damageto the Premisescaused bysuch CondemnaƟon.

15. Brokerage Fees.

15.1 AddiƟonalCommission. In addiƟontothe paymentsowed pursuantto Paragraph1.9above, Lessoragrees that: (a) ifLessee exercisesany OpƟon, (b)if

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Lesseeor anyone affiliated withLesseeacquires anyrights tothe Premisesorother premisesowned byLessorand locatedwithin thesameProject, ifany,within whichthe Premisesis located,(c)if Lesseeremains inpossession ofthePremises, withthe consentofLessor, aŌerthe expiraƟonofthis Lease,or (d)if BaseRentis increased,whether byagreement or operaƟonof an escalaƟon clauseherein, then,Lessorshall payBrokersafeein accordancewith thefeeschedule ofthe Brokersin effectat the Ɵme theLeasewas executed. Theprovisions ofthisparagraph areintended tosupersedethe provisionsof anyearlieragreement tothe contrary.

15.2 AssumpƟon of ObligaƟons. Anybuyer ortransfereeof Lessor'sinterest inthisLease shallbe deemedtohave assumedLessor's obligaƟonhereunder.

Brokersshall bethird party beneficiariesof theprovisions ofParagraphs 1.9,15,22 and31. IfLessor failsto paytoBrokersanyamounts dueas andforbrokerage fees pertainingto thisLease whendue,then suchamounts shallaccrue Interest. In addiƟon,if Lessorfailsto payany amountstoLessee's Brokerwhen due,Lessee's Brokermay send wriƩen noƟcetoLessor andLessee ofsuch failureandif Lessorfails topaysuch amountswithin 10days aŌer said noƟce, Lesseeshall paysaid moniesto itsBrokerand offsetsuch amountsagainst Rent. In addiƟon,Lessee's Brokershall bedeemedto bea thirdparty beneficiary ofany commissionagreement enteredinto byand/or betweenLessorand Lessor'sBrokerforthe limitedpurposeof collecƟngany brokeragefeeowed.

15.3 RepresentaƟons and IndemniƟesof Broker RelaƟonships. Lesseeand Lessoreach representandwarrant tothe otherthatit hashad nodealings withany person, firm, broker,agent or finder(other thanthe Brokersand Agents,ifany) in connecƟon withthisLease, andthat nooneother thansaid namedBrokersand Agentsis enƟtledto anycommissionor finder'sfeein connecƟon herewith. Lessee andLessor doeachhereby agreeto indemnify,protect,defend andhold theother harmlessfrom andagainst liabilityfor compensaƟon orcharges whichmay beclaimedby anysuch unnamedbroker,finder orother similarpartyby reasonof any dealingsor acƟonsof theindemnifyingParty,includingany costs,expenses, aƩorneys'feesreasonably incurredwith respectthereto.

16. Estoppel CerƟficates.
(a) Each Party(as "RespondingParty")shall within10 days aŌer wriƩen noƟcefrom theother Party(the"RequesƟng Party")execute, acknowledgeand deliverto the RequesƟng Partyastatement in wriƟng inform similartothe thenmost current"Estoppel CerƟficate" formpublished byAIRCRE, plussuch addiƟonal informaƟon, confirmaƟon and/orstatements asmaybe reasonablyrequested bythe RequesƟngParty. (b) Ifthe RespondingParty shallfailto executeor delivertheEstoppel CerƟficatewithin such10 dayperiod,the RequesƟngParty mayexecutean Estoppel CerƟficate staƟngthat: (i)theLease isin fullforce and effectwithout modificaƟonexcept asmaybe representedby the RequesƟngParty,(ii)there areno uncureddefaults inthe RequesƟngParty'sperformance, and(iii) ifLessor isthe RequesƟng Party,not morethanone month'srent hasbeenpaid inadvance.

ProspecƟvepurchasers andencumbrancers mayrelyupon the RequesƟng Party'sEstoppel CerƟficate,andthe RespondingParty shallbeestopped fromdenying the truthof thefacts containedinsaid CerƟficate. In addiƟon, Lesseeacknowledgesthat anyfailure onitspart toprovide suchanEstoppel CerƟficatewill exposeLessor torisks and potenƟally causeLessorto incurcosts notcontemplated bythisLease, theextent ofwhichwill beextremely difficulttoascertain. Accordingly,shouldthe Lesseefail toexecute and/ordelivera requestedEstoppel CerƟficatein a Ɵmelyfashion themonthly BaseRentshall be automaƟcally increased,withoutany requirementfor noƟceto Lessee,byan amountequal to10% ofthethen exisƟngBase Rentor$100, whicheveris greaterforremainder ofthe Lease. The ParƟes agreethat suchincrease inBaseRent representsfair andreasonable compensaƟonforthe addiƟonalrisk/costs thatLessorwill incurby reasonofLessee's failureto providethe Estoppel CerƟficate. Suchincrease inBase Rentshall innoevent consƟtutea waiverofLessee's Defaultor Breachwithrespect tothe failureto provide theEstoppel CerƟficatenor preventtheexercise ofany ofthe otherrightsand remediesgranted hereunder. (c) IfLessor desiresto finance, refinance,or sellthe Premises,or anypartthereof,Lesseeand allGuarantorsshall within10 days aŌer wriƩen noƟce fromLessor deliverto any potenƟallender orpurchaser designatedby Lessorsuch financial statementsas maybereasonably requiredby suchlenderor purchaser, includingbut notlimited toLessee's financial statementsfor thepast 3years. Allsuch financialstatementsshall bereceived byLessorand suchlender orpurchaser in confidenceand shallbe usedonlyfor thepurposes hereinset forth.

17. DefiniƟon ofLessor. Theterm "Lessor"as usedhereinshall meanthe owneror ownersatthe Ɵmein quesƟonofthe fee Ɵtle tothePremises, or,if thisis a sublease,of theLessee's interestinthe priorlease. In theeventof atransfer ofLessor's Ɵtle orinterest inthePremises orthis Lease,Lessor shalldeliverto the transfereeor assignee(in cashorby credit)any unusedSecurity Depositheldby Lessor. Uponsuchtransfer orassignment anddeliveryof theSecurity Deposit,as aforesaid,the priorLessor shallberelieved ofall liabilitywith respecttothe obligaƟonsand/or covenantsunderthis Lease thereaŌer tobeperformed bythe Lessor.

Subjectto theforegoing, the obligaƟonsand/or covenantsin thisLease tobeperformed bythe Lessorshallbe bindingonly upontheLessor ashereinabove defined.

18. Severability. The invalidityofany provisionof thisLease,as determinedby acourt ofcompetent jurisdicƟon, shallin noway affect thevalidity ofanyother provisionhereof.

19. Days. Unless otherwise specificallyindicated tothe contrary,theword "days"as usedin thisLeaseshall meanand refertocalendar days.

20. LimitaƟon onLiability. The obligaƟons ofLessor underthisLease shallnot consƟtutepersonal obligaƟonsofLessor,orits partners,members,directors, officers orshareholders, andLessee shalllookto thePremises, andto nootherassets ofLessor,forthe saƟsfacƟon ofany liabilityofLessor withrespect tothis Lease,and shallnot seekrecourse againstLessor'spartners, members,directors, officersor shareholders,orany oftheir personalassetsfor such saƟsfacƟon.

21. Time ofEssence. Timeis ofthe essencewithrespect tothe performanceof all obligaƟonsto beperformed orobservedby the ParƟes underthisLease.

22. No Prioror OtherAgreements;Broker Disclaimer. ThisLeasecontains allagreements betweenthe ParƟeswithrespect toany maƩer menƟonedherein, andno otherprior orcontemporaneous agreementorunderstanding shallbe effecƟve. LessorandLessee eachrepresents andwarrantsto theBrokersthatithas made,and isrelying solelyupon, itsown invesƟgaƟon asto thenature, quality,characterand financialresponsibility oftheother Partyto thisLeaseand asto theuse, nature, qualityand characterof thePremises. Brokershave noresponsibility withrespectthereto orwith respecttoany defaultor breachhereofby eitherParty.

23. NoƟces.

23.1 NoƟce Requirements. All noƟcesrequired or permiƩedby thisLease orapplicablelaw shallbe in wriƟngand maybe deliveredin person(byhand orby courier)or maybe sentbyregular, cerƟfiedor registeredmail orU.S.PostalServiceExpress Mail,withpostage prepaid,or byfacsimiletransmission, orby email,and shallbe deemed sufficiently givenifserved ina manner specified inthisParagraph23. Theaddressesnoted adjacentto aParty'ssignature onthis Leaseshall bethat Party'saddress fordelivery ormailingof noƟces. EitherParty mayby wriƩen noƟceto theotherspecify a different addressfor noƟce, exceptthat uponLessee's takingpossession ofthe Premises,thePremises shall consƟtute Lessee'saddress for noƟce. Acopy ofall noƟces toLessor shallbeconcurrently transmiƩedto such partyor parƟesat suchaddressesas Lessormay from Ɵme to Ɵme hereaŌer designatein wriƟng.

23.2 Date of NoƟce. Any noƟce sentbyregistered or cerƟfied mail,returnreceipt requested,shall bedeemedgiven onthe dateof deliveryshownon the receiptcard, orif nodeliverydate isshown, thepostmark thereon. If sentby regularmailthe noƟceshall bedeemedgiven 72hours aŌerthe sameisaddressed as requiredherein andmailed withpostageprepaid. NoƟces deliveredby UnitedStatesExpress Mailor overnightcourierthat guaranteesnext daydeliveryshall be deemedgiven 24hours aŌerdeliveryof thesame tothe PostalServiceor courier. NoƟcesdeliveredby hand,or transmiƩedbyfacsimile transmissionor byemail shallbe deemeddelivered uponactualreceipt. If noƟceis receivedona Saturday,Sunday orlegalholiday,itshall bedeemedreceived onthe nextbusiness day.

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23.3 OpƟons. Notwithstandingthe foregoing,in ordertoexercise any OpƟons (seeparagraph39), the NoƟce mustbesent by CerƟfied Mail(return receipt requested),Express Mail(signature required),courier(signature required)or someother methodologythatprovides areceipt establishingthedate the noƟce was receivedby theLessor.

24. Waivers.
(a) No waiverby Lessorofthe Defaultor Breachof anyterm,covenant or condiƟon hereofbyLessee, shallbe deemedawaiver ofany otherterm, covenantor condiƟonhereof,orofany subsequentDefault orBreach byLesseeof thesame orofany otherterm, covenantor condiƟon hereof. Lessor'sconsent to, orapproval of,any actshallnot bedeemed torender unnecessarytheobtaining ofLessor's consentto,or approvalof,anysubsequentor similaract byLessee, orbe construedas thebasis ofanestoppel toenforce theprovision orprovisionsof thisLease requiringsuchconsent. (b) Theacceptance ofRent byLessorshall notbe awaiverof anyDefault orBreach byLessee. Anypayment byLesseemay beaccepted byLessoron accountof moniesor damagesdueLessor,notwithstandingany qualifyingstatements or condiƟonsmade byLessee in connecƟontherewith, whichsuch statements and/or condiƟons shallbe ofnoforce or effect whatsoeverunless specificallyagreedto in wriƟng byLessorat orbefore the Ɵmeof depositof suchpayment. (c) THEPARTIESAGREETHATTHETERMSOF THISLEASE SHALLGOVERN WITHREGARDTOALLMATTERS RELATEDTHERETOAND HEREBYWAIVE THE PROVISIONSOF ANYPRESENT ORFUTURESTATUTETOTHE EXTENTTHATSUCHSTATUTEIS INCONSISTENTWITH THISLEASE.

25. Disclosures Regardingthe Natureofa RealEstate Agency RelaƟonship. (a) When enteringinto adiscussionwith areal estateagent regardingareal estate transacƟon, aLessoror Lesseeshould fromtheoutset understand whattype ofagency relaƟonshipor representaƟon ithas withthe agentoragents inthe transacƟon. Lessor andLessee acknowledgebeingadvised bythe Brokersin this transacƟon, asfollows:
(i) Lessor'sAgent. A Lessor'sagent undera lisƟng agreementwith theLessoracts asthe agentforthe Lessoronly. A Lessor'sagentor subagent hasthe following affirmaƟve obligaƟons: TotheLessor: A fiduciarydutyof utmostcare, integrity,honesty,and loyaltyin dealingswiththe Lessor. Tothe Lesseeand theLessor: (a) Diligentexerciseof reasonableskills andcare inperformanceof theagent's duƟes. (b) Aduty ofhonestand fairdealing andgood faith. (c) Aduty to discloseall factsknown totheagent materially affecƟng thevalue ordesirabilityof theproperty thatarenot knownto,orwithinthe diligent aƩenƟon and observaƟonof,the ParƟes. Anagent isnot obligatedto revealtoeither Partyany confidenƟal informaƟonobtained fromthe otherPartywhich doesnot involvethe affirmaƟve duƟes setforth above.
(ii) Lessee'sAgent. Anagent canagree toactas agentfor theLesseeonly. In these situaƟons,the agentis notthe Lessor'sagent,even ifby agreementthe agentmay receive compensaƟonfor servicesrendered, eitherin fullorin partfrom theLessor. Anagent acƟngonlyfor aLessee hasthe following affirmaƟve obligaƟons. TotheLessee: A fiduciary dutyof utmostcare,integrity,honesty,and loyaltyindealings withthe Lessee. TotheLessee andthe Lessor: (a) Diligentexercise ofreasonable skillsandcare inperformance ofthe agent's duƟes. (b)A dutyofhonest andfair dealingandgood faith. (c)A dutytodisclose allfacts knownto theagent materially affecƟngthe valueor desirabilityof thepropertythat arenot knownto,or withinthe diligent aƩenƟonand observaƟonof,the ParƟes.

Anagent isnot obligatedtoreveal toeither Partyany confidenƟal informaƟonobtained fromthe otherPartywhich doesnot involvethe affirmaƟve duƟesset forth above.
(iii) Agent RepresenƟngBothLessor andLessee. Areal estateagent, either acƟng directlyorthrough oneor moreassociatelicensees, canlegally be theagent ofboth theLessorand theLessee ina transacƟon,butonly withthe knowledgeandconsent ofboth theLessorand theLessee. In adualagency situaƟon, theagent hasthe following affirmaƟve obligaƟons toboth theLessor andtheLessee: (a)A fiduciarydutyof utmostcare, integrity,honestyand loyaltyin thedealings witheither Lessoror theLessee. (b)Other duƟesto theLessorand theLessee asstatedabove insubparagraphs (i)or(ii). In represenƟngboth LessorandLessee, the agentmay not,without theexpresspermission ofthe respecƟveParty,disclosetothe otherParty confidenƟal informaƟon,including, butnot limitedto,facts relaƟng toeither Lessee'sor Lessor's financial posiƟon, moƟvaƟons,bargaining posiƟon,or otherpersonal informaƟon thatmay impactrent,including Lessor'swillingness to accepta rentless thanthe lisƟng rentor Lessee'swillingness topayrent greaterthan therentoffered. The above duƟesof theagent ina realestate transacƟon do notrelieve aLessor orLesseefrom theresponsibility toprotect theirowninterests. Lessor andLesseeshould carefullyread allagreementsto assurethat they adequatelyexpress theirunderstanding ofthe transacƟon. A realestateagentisa person qualified toadviseabout realestate. Iflegal ortax adviceis desired,consult acompetent professional. BothLessorand Lesseeshould stronglyconsider obtainingtaxadvice froma competentprofessionalbecause thefederal andstatetax consequencesof a transacƟon canbecomplex andsubject tochange. (b) Brokershave noresponsibility withrespectto anydefault orbreachhereof byeither Party. The ParƟesagree thatno lawsuitorother legal proceedinginvolving anybreach ofduty,error oromission relaƟngto thisLeasemay bebrought againstBrokermore thanone year aŌerthe StartDate andthat the liability(including courtcosts and aƩorneys'fees), ofany Brokerwith respecttoany suchlawsuit and/orlegalproceeding shallnot exceedthefee receivedby such Brokerpursuant tothis Lease;provided,however,thatthe foregoing limitaƟon oneachBroker'sliabilityshall notbeapplicable toany grossnegligenceor willful misconductof suchBroker.
(c) Lessorand Lesseeagree to idenƟfyto Brokersas "ConfidenƟal"any communicaƟonor informaƟon givenBrokersthatisconsidered bysuch Partyto be confidenƟal.

26. No RightToHoldover. Lessee hasno righttoretain possessionof thePremises oranypart thereofbeyond the expiraƟonor terminaƟonof thisLease. Ator priorto the expiraƟon or terminaƟonof thisLease Lesseeshall deliverexclusivepossession ofthe PremisestoLessor. For purposesofthis provisionand Paragraph

13.1(a),exclusive possessionshall meanthatLessee shallhave vacatedthe Premises,removedall ofits personalpropertytherefrom andthat thePremiseshave been returnedin the condiƟon specifiedinthis Lease. Inthe eventthatLessee doesnot deliverexclusivepossession toLessor as specifiedabove, thenLessor's damages duringany holdoverperiod shallbecomputed atthe amountof theRent(as definedin Paragraph4.1)due duringthe lastfullmonth beforethe expiraƟonor terminaƟonof thisLease (disregardinganytemporary abatementof Rentthat mayhavebeen in effect), butwithBase Rentbeing 150%ofthe BaseRent payable duringsuch lastfull month. Nothing containedherein shallbe construedasconsent byLessor toanyholding overby Lessee.

27. CumulaƟve Remedies. Noremedyor elecƟonhereunder shallbedeemed exclusivebut shall,wherever possible,be cumulaƟve withall otherremediesat lawor inequity.

28. Covenants and CondiƟons; ConstrucƟonofAgreement. All provisionsofthis Leaseto beobserved orperformedby Lesseeare bothcovenantsand condiƟons.

Inconstruing thisLease, allheadingsand Ɵtlesare forthe convenienceofthe ParƟesonly andshallnot beconsidered apartof thisLease. Whenever requiredbythe context,the singularshall includetheplural andvice versa. ThisLeaseshall notbe construedasif preparedby oneofthe ParƟes,but ratheraccording toitsfair meaningas awhole, asifboth ParƟeshad preparedit.

29. Binding Effect;Choice ofLaw. ThisLease shallbebinding uponthe ParƟes,their personalrepresentaƟves,successors andassigns andbegoverned bythe laws ofthe Statein whichthePremises arelocated. Any liƟgaƟonbetweenthe ParƟeshereto concerningthisLease shallbe iniƟatedinthe countyin whichthe Premises arelocated. Signatures tothisLease accomplishedby meansof electronicsignatureor similartechnology shallbelegal andbinding.

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30. SubordinaƟon; AƩornment;Non-Disturbance.

30.1 SubordinaƟon. ThisLease andany OpƟongrantedhereby shallbe subjectandsubordinate toany groundlease,mortgage, deedof trust,or other hypothecaƟonor securitydevice (collecƟvely,"SecurityDevice"), nowor hereaŌerplaced uponthePremises, toany andalladvances madeon thesecuritythereof, andto allrenewals, modificaƟons,andextensions thereof. Lesseeagrees thattheholders ofany suchSecurityDevices (inthis Leasetogetherreferredtoas "Lender") shallhave noliability or obligaƟonto performany ofthe obligaƟonsofLessor underthis Lease. Any Lendermay electtohave thisLease and/orany OpƟongranted herebysuperior tothe lienofits SecurityDevice bygiving wriƩen noƟcethereof toLessee, whereuponthisLease andsuch OpƟonsshallbe deemedprior tosuch SecurityDevice, notwithstandingthe relaƟvedatesof the documentaƟon or recordaƟon thereof.

30.2 AƩornment. Inthe eventthat Lessortransfers Ɵtle tothe Premises,orthe Premisesare acquiredbyanother uponthe foreclosureor terminaƟonofa SecurityDevice towhich thisLeaseis subordinated(i) Lesseeshall, subjecttothe non-disturbanceprovisions ofParagraph30.3, aƩornto suchnewowner,andupon request,enter intoa newlease,containing allof theterms andprovisionsof thisLease, withsuchnew ownerfor theremainderof theterm hereof,or,atthe elecƟon ofthe newowner,thisLeasewill automaƟcallybecome anew leasebetweenLessee andsuch newowner,and (ii)Lessor shall thereaŌerbe relievedof anyfurther obligaƟonshereunder andsuch newownershall assumeall ofLessor's obligaƟons,exceptthat suchnew ownershallnot: (a)be liableforany actor omissionof any priorlessor orwith respecttoevents occurringprior to acquisiƟon ofownership;(b) besubject toany offsets ordefenses whichLesseemight haveagainst anyprior lessor, (c)be boundbyprepayment ofmore thanone month'srent,or (d)be liableforthe returnof anysecuritydeposit paidto anyprior lessorwhichwas notpaid or creditedto suchnew owner.

30.3 Non-Disturbance. Withrespect toSecurity Devicesenteredinto byLessor aŌerthe execuƟon ofthis Lease,Lessee's subordinaƟon ofthis Leaseshall be subjectto receivinga commerciallyreasonablenon-disturbance agreement(a "Non-DisturbanceAgreement") fromtheLender whichNon-Disturbance Agreement providesthat Lessee'spossession ofthePremises, andthis Lease,including any opƟonsto extendthe termhereof,will notbe disturbedsolong asLessee isnot in Breachhereof and aƩorns totherecord ownerof thePremises. Further,within 60days aŌertheexecuƟon ofthis Lease,Lessorshall, ifrequested byLessee, useits commerciallyreasonable effortsto obtainaNon-Disturbance Agreementfrom theholder ofanypre-exisƟng SecurityDevice whichissecured bythe Premises. In the eventthat Lessoris unabletoprovide theNon-Disturbance Agreementwithin said60days, thenLessee may,atLessee's opƟon,directly contactLenderand aƩempt to negoƟate forthe execuƟonanddelivery ofa Non-DisturbanceAgreement.

30.4 Self-ExecuƟng. Theagreements containedin thisParagraph30 shallbe effecƟvewithoutthe execuƟonof anyfurtherdocuments; provided,however,that, upon wriƩen requestfrom Lessorora Lenderin connecƟonwith asale, financing or refinancing ofthePremises, Lesseeand Lessorshallexecute suchfurther wriƟngs asmay bereasonably requiredtoseparately documentany subordinaƟon, aƩornment and/orNon-DisturbanceAgreement providedfor herein.

31. AƩorneys' Fees. IfanyParty orBrokerbringsan acƟon orproceeding involvingthe Premiseswhetherfounded intort, contractorequity,orto declarerights hereunder,the PrevailingParty (as hereaŌer defined) inany suchproceeding, acƟon,orappeal thereon,shall be enƟtledto reasonable aƩorneys' fees. Such feesmay beawarded inthe samesuitor recoveredin aseparate suit,whetheror notsuch acƟonorproceeding ispursued todecisionor judgment. Theterm, "Prevailing Party"shall include,without limitaƟon,aParty orBrokerwho substanƟally obtainsordefeats therelief sought,asthe casemay be,whetherby compromise, seƩlement,judgment, orthe abandonmentbythe otherParty orBroker ofitsclaim ordefense. The aƩorneys' feesaward shallnotbe computedin accordancewith anycourt feeschedule, butshallbe suchas tofully reimburseall aƩorneys' feesreasonably incurred. In addiƟon,Lessor shallbe enƟtled to aƩorneys' fees,costs and expensesincurred inthe preparaƟonandservice of noƟces ofDefault and consultaƟonsin connecƟontherewith, whetherornot alegal acƟonissubsequently commencedin connecƟonwith suchDefaultor resulƟngBreach ($200is areasonableminimum peroccurrence forsuchservices and consultaƟon).

32. Lessor's Access;Showing Premises;Repairs. Lessorand Lessor'sagentsshall havethe rightto enterthePremises atany Ɵme,inthe caseof anemergency,and otherwiseat reasonable Ɵmes aŌerreasonableprior noƟcefor thepurpose ofshowingthe sameto prospecƟvepurchasers,lenders, ortenants, andmakingsuch alteraƟons,repairs, improvementsor addiƟonstothe Premisesas Lessormay deemnecessaryor desirableand the erecƟng,using andmaintaining of uƟliƟes, services,pipes andconduits throughthePremises and/orother premisesas longasthere isno materialadverse effect onLessee's useofthe Premises. Allsuch acƟviƟesshall bewithout abatementofrent orliability toLessee.

33. AucƟons. Lessee shallnotconduct, norpermit tobeconducted, any aucƟon uponthe PremiseswithoutLessor's prior wriƩen consent. Lessor shallnot be obligatedto exerciseany standardofreasonableness indetermining whetherto permitan aucƟon.

34. Signs. Lessor mayplaceon thePremises ordinary"ForSale" signsat any Ɵme andordinary"For Lease"signs duringthelast 6months oftheterm hereof. Except forordinary "forsublease" signs,Lesseeshall notplace anysign uponthePremises withoutLessor's prior wriƩenconsent. All signsmustcomply withall Applicable Requirements.

35. TerminaƟon; Merger. Unless specificallystated otherwisein wriƟngbyLessor,thevoluntary orother surrenderofthis Leaseby Lessee,themutual terminaƟon or cancellaƟon hereof,or a terminaƟonhereof byLessor forBreach byLessee,shall automaƟcallyterminate anysubleaseor lesserestate inthePremises; provided, however,that Lessormay electto conƟnue anyone orall exisƟngsubtenancies. Lessor'sfailure within10days followingany sucheventto electto thecontrary by wriƩen noƟce tothe holderofany suchlesser interest,shall consƟtuteLessor's elecƟon tohave suchevent consƟtute the terminaƟon ofsuchinterest.

36. Consents. All requestsforconsent shallbe in wriƟng. Exceptas otherwiseprovided herein,whereverin thisLease theconsentof aParty isrequiredto anact by orfor theother Party,suchconsent shallnot beunreasonably withheldordelayed. Lessor's actualreasonablecosts andexpenses (includingbutnot limitedto architects', aƩorneys', engineers'and otherconsultants'fees) incurredin the consideraƟon of,orresponse to,a requestbyLessee forany Lessorconsent,including butnot limitedto consentstoan assignment,a subleƫngor thepresenceor useof aHazardousSubstance, shallbe paidbyLessee uponreceipt ofan invoiceand supporƟng documentaƟon therefor. Lessor'sconsentto anyact, assignmentor subleƫngshallnot consƟtutean acknowledgmentthatno Defaultor BreachbyLessee ofthis Leaseexists, norshallsuch consentbe deemeda waiverofany then exisƟng DefaultorBreach, exceptas maybeotherwise specificallystated in wriƟng by Lessorat the Ɵme ofsuchconsent. The failureto specifyhereinany parƟcular condiƟon toLessor'sconsent shallnot precludethe imposiƟon byLessor atthe Ɵmeof consentof suchfurther orother condiƟons asare thenreasonable withreferenceto the parƟcular maƩerforwhich consentis beinggiven. Inthe eventthat either Partydisagrees withany determinaƟonmadeby theother hereunderand reasonablyrequeststhe reasonsfor such determinaƟon,the determiningparty shallfurnish itsreasons in wriƟng andinreasonable detailwithin 10business daysfollowingsuch request.

37. Guarantor.

37.1 ExecuƟon. TheGuarantors,ifany,shalleachexecute aguaranty intheform mostrecently publishedbyAIR CRE.

37.2 Default. Itshall consƟtutea Defaultofthe Lesseeif anyGuarantorfails orrefuses, uponrequestto provide: (a)evidence ofthe execuƟon ofthe guaranty, includingthe authorityof thepartysigning onGuarantor's behalfto obligateGuarantor,and inthe caseofa corporateGuarantor,a cerƟfiedcopy ofa resoluƟonof its boardof directorsauthorizing themakingof suchguaranty,(b)current financialstatements,(c) anEstoppel CerƟficate,or(d) wriƩen confirmaƟon thattheguaranty is sƟllin effect.

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38. Quiet Possession. Subjecttopayment byLessee oftheRent andperformance ofall ofthecovenants, condiƟonsand provisionsonLessee's partto beobserved andperformed underthis Lease,Lesseeshall havequiet possessionand quietenjoymentof thePremises duringtheterm hereof.

39. OpƟons. If Lesseeisgranted any OpƟon, as definedbelow,thenthe followingprovisions shallapply.

39.1 DefiniƟon. "OpƟon"shall mean: (a)theright toextend orreducethe termof orrenewthis Leaseor toextend orreducethe termof orrenewany lease thatLessee hason otherpropertyof Lessor;(b) theright of firstrefusal or first offertolease eitherthe Premisesorother propertyof Lessor;(c) therightto purchase, theright of first offertopurchase orthe rightof firstrefusalto purchasethe Premisesorother propertyof Lessor.

39.2 OpƟons PersonalToOriginal Lessee. Any OpƟongranted toLessee inthisLease ispersonal totheoriginal Lessee,and cannotbe assignedorexercisedby anyoneother thansaid originalLesseeand onlywhile theoriginal Lesseeisin fullpossession ofthePremises and,if requestedbyLessor,withLessee cerƟfyingthat Lesseehas no intenƟon of thereaŌerassigning or subleƫng.

39.3 MulƟple OpƟons. In theevent thatLesseehas any mulƟple OpƟonstoextend orrenew thisLease,a later OpƟon cannotbe exercisedunlessthe prior OpƟonshave beenvalidly exercised.

39.4 Effect ofDefaulton OpƟons.
(a) Lessee shallhave norightto exercisean OpƟon: (i)duringthe periodcommencing withthegiving ofany noƟceofDefault and conƟnuing unƟlsaid Defaultis cured,(ii) duringtheperiod of Ɵme anyRent isunpaid(without regardto whethernoƟcethereof isgiven Lessee),(iii)during the Ɵme Lesseeis inBreachof thisLease, or(iv) intheevent thatLessee hasbeen given3or more noƟces ofseparateDefault, whetheror nottheDefaults arecured, duringthe 12monthperiod immediatelypreceding theexercise ofthe OpƟon.
(b) Theperiod of Ɵme withinwhichan OpƟonmay beexercisedshall notbe extendedor enlargedbyreason ofLessee's inabilitytoexercise an OpƟon becauseof theprovisions ofParagraph39.4(a).
(c) An OpƟon shallterminate andbeof nofurther forceor effect,notwithstandingLessee's dueand Ɵmelyexerciseof the OpƟon, if, aŌersuch exercise andprior tothe commencement ofthe extendedterm or compleƟon ofthepurchase, (i)Lessee failstopay Rentfor aperiodof 30days aŌersuch Rentbecomesdue (withoutany necessityof Lessortogive noƟcethereof), or(ii) ifLesseecommits aBreach ofthisLease.

40. MulƟple Buildings. IfthePremises area partofa groupof buildingscontrolled byLessor,Lessee agreesthat itwillabide byand conformtoall reasonablerules and regulaƟons whichLessor maymakefrom Ɵmeto Ɵmefor themanagement,safety,andcare ofsaid properƟes, includingthe careandcleanliness ofthe grounds andincluding theparking, loadingandunloading ofvehicles, andto causeitsemployees, suppliers,shippers, customers,contractorsand inviteesto soabideand conform. Lesseealso agreestopay itsfair shareof commonexpensesincurred in connecƟon withsuchrules and regulaƟons.

41. Security Measures. Lesseeherebyacknowledges thatthe Rentpayableto Lessorhereunder doesnot includethecost ofguard serviceorother security measures,and thatLessor shallhaveno obligaƟonwhatsoever toprovide same. Lessee assumesall responsibility forthe protecƟonof thePremises,Lessee, its agentsand inviteesand theirpropertyfrom theacts ofthird parƟes.

42. ReservaƟons. Lessor reservestoitself theright, from Ɵmeto Ɵme,to grant,without theconsentor joinderof Lessee,sucheasements, rightsand dedicaƟons thatLessor deemsnecessary, andtocause the recordaƟon ofparcel mapsand restricƟons, solong assucheasements, rights, dedicaƟons, mapsand restricƟons do notunreasonably interferewith theuseof thePremises byLessee. Lesseeagrees tosign anydocumentsreasonably requestedby Lessorto effectuateanysuch easementrights, dedicaƟon,map or restricƟons.

43. Performance UnderProtest. Ifat any Ɵme adisputeshall ariseas toany amountorsum ofmoney tobepaid byone Partytothe otherunder theprovisions hereof,the Partyagainst whomthe obligaƟon topay themoney isassertedshall havethe righttomake payment"under protest"andsuch paymentshall notbe regardedas avoluntary paymentandthere shallsurvive theright onthepart ofsaid Partyto insƟtute suitfor recoveryofsuch sum. Ifit shallbeadjudged thatthere wasno legal obligaƟon onthepart ofsaid Partyto paysuchsum orany partthereof,said Partyshall be enƟtledto recoversuch sumor somuchthereof asit wasnot legallyrequired topay. AParty whodoes not iniƟate suitforthe recoveryof sumspaid"under protest"within 6monthsshall bedeemed tohave waiveditsright to protestsuch payment.

44. Authority; MulƟple ParƟes; ExecuƟon.
(a) If eitherParty heretoisa corporaƟon,trust, limitedliability company,partnership,or similar enƟty,eachindividual execuƟng thisLease onbehalfof such enƟty representsand warrantsthathe orshe isduly authorizedtoexecute anddeliver thisLeaseon itsbehalf. EachParty shall,within 30days aŌerrequest, deliverto theother Party saƟsfactoryevidence ofsuch authority. (b) Ifthis Leaseis executedbymore thanone personor enƟty as"Lessee", eachsuch personorenƟty shallbe jointlyandseverally liablehereunder. Itis agreedthat anyone ofthenamed Lesseesshall beempowered toexecuteany amendmentto thisLease,or otherdocument ancillarytheretoand bindall ofthe namedLessees, andLessor mayrelyon thesame asif allofthe namedLessees hadexecutedsuch document. (c) ThisLease maybe executedbythe ParƟesin counterparts,each ofwhichshall bedeemed anoriginaland allof whichtogethershall consƟtuteone andthe sameinstrument.

45. Conflict. Any conflictbetweenthe printedprovisions ofthisLease andthe typewriƩenor handwriƩenprovisionsshall becontrolled bythe typewriƩen or handwriƩenprovisions.

46. Offer. PreparaƟon ofthisLease byeither Partyortheir agentand submission of sametothe otherParty shallnotbe deemedan offertolease tothe other Party. ThisLease isnotintended tobe binding unƟl executedanddelivered byall ParƟeshereto.

47. Amendments. This Leasemaybe modifiedonly in wriƟng,signed bythe ParƟesin interestatthe Ɵmeof the modificaƟon. Aslong astheydo notmaterially changeLessee's obligaƟonshereunder,Lesseeagreesto makesuch reasonablenon-monetary modificaƟonstothis Leaseas maybereasonably requiredby aLender in connecƟon withthe obtainingofnormal financingor refinancingof thePremises.

48. Waiver ofJury Trial. THE PARTIESHEREBY WAIVETHEIRRESPECTIVE RIGHTSTOTRIALBYJURYINANY ACTIONOR PROCEEDINGINVOLVINGTHE PROPERTY ORARISING OUTOF THISLEASE.

49. ArbitraƟon ofDisputes. AnAddendum requiringthe ArbitraƟonofall disputesbetween theParƟes and/orBrokersarising outof thisLease is isnot aƩachedto thisLease.

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50. Accessibility; Americanswith DisabiliƟes Act.
(a) The Premises:
have notundergone an inspecƟonby a CerƟfied AccessSpecialist (CASp). Note: A CerƟfied AccessSpecialist(CASp) caninspect thesubjectpremises and determinewhether thesubject premisescomplywith allof theapplicable construcƟon-relatedaccessibilitystandards understate law.Althoughstate lawdoes not requirea CASp inspecƟon ofthesubject premises,the commercialproperty ownerorlessor maynot prohibitthelessee ortenant fromobtaininga CASp inspecƟon of thesubject premisesfor theoccupancyor potenƟaloccupancy ofthe lesseeortenant, ifrequested bythelessee ortenant. The parƟesshall mutuallyagree onthe arrangementsfor the Ɵme andmannerof theCASp inspecƟon,the paymentofthe feefor theCASpinspecƟon, andthe costofmaking anyrepairs necessaryto correct violaƟons of construcƟon-related accessibilitystandardswithin thepremises. have undergonean inspecƟonbya CerƟfiedAccess Specialist(CASp) anditwas determinedthat thePremisesmet allapplicable construcƟon-related accessibilitystandards pursuantto CaliforniaCivilCode §55.51et seq. Lesseeacknowledgesthat itreceived acopyof the inspecƟon reportatleast 48hours priorto execuƟngthis Leaseand agreestokeep suchreport confidenƟal. have undergonean inspecƟonbya CerƟfiedAccess Specialist(CASp) anditwas determinedthat thePremisesdid notmeet allapplicable construcƟon-related accessibilitystandards pursuantto CaliforniaCivilCode §55.51et seq. Lesseeacknowledgesthat itreceived acopyof the inspecƟon reportatleast 48hours priorto execuƟngthis Leaseand agreestokeep suchreport confidenƟalexcept asnecessaryto completerepairs and correcƟonsof violaƟonsof construcƟonrelated accessibilitystandards.

Inthe eventthat thePremiseshave beenissued an inspecƟon reportbya CASpthe Lessorshallprovide acopy ofthedisability access inspecƟon cerƟficateto Lessee within7 daysof the execuƟonof thisLease.
(b) Sincecompliance withthe Americanswith DisabiliƟes Act(ADA) andotherstate andlocal accessibilitystatutes aredependentupon Lessee's specific useof thePremises, Lessormakesno warrantyor representaƟonas towhetheror notthe Premisescomplywith ADAor anysimilar legislaƟon. In theevent that Lessee'suse ofthe Premisesrequires modificaƟons or addiƟons tothe Premisesinorder tobe incompliancewith ADAor otheraccessibilitystatutes, Lesseeagrees to makeany suchnecessary modificaƟonsand/or addiƟons atLessee's expense.

51.RentSchedule.MonthlyBaseRentshallbedueandpaidperthefollowingschedule:

Year1 $11,385.00
Year2 $11,669.68
Year3 $11,961.37
Year4 $12,260.40
Year5 $12,566.91

52.TermOptions. ProvidedLesseeisnotthenindefaultandisstillinpossessionofthePremises, Lesseeshallhaveone(1)OptiontoExtendthetermforanadditionalfive(5)years,commencing immediatelyaftertheendoftheinitialTerm. AlltermsandconditionsoftheLeasewouldremainthe sameduringtheextendedterm,exceptforthescheduleofMonthlyBaseRent,whichwouldbesubjectto negotiationbetweentheparties. InordertoexerciseanOption,LesseeshallberequiredtogiveLessor writtennoticeofsuchintentiononorbeforeOneHundredEighty(180)daysbeforetheexpirationofthe currentterm,orelsetheOptionshallthereafterbedeemednullandvoid.OnceLesseehasgivenLessor therequirednoticetoexercisetheOption,thescheduleofMonthlyBaseRentshallbeagreeduponin writingnolaterthanOneHundredTwenty(120)daysbeforetheexpirationofthecurrentterm,orelse theOptionshallthereafterbedeemednullandvoid.

53. ElectronicSignatures.EachpartyagreesthatthisAgreementandanyotherdocumentstobe deliveredinconnectionherewithmaybedeliveredelectronically,orelectronicallysigned,andthatany electronicsignaturesappearingonthisAgreement,otherrelateddocuments,oranyamendmentthereto, shallbebindingtothesameextentasanoriginalsignature,forthepurposesofvalidity,enforceability, andadmissibility.

54.AdditionalLessorWork. InadditiontotheMonthlyBaseRentquotedintheRentSchedulein paragraph51ofthisLease,LesseeshallpayanadditionalamounteverymonthoftheinitialTermofthe LeasewhichrepresentstheamortizationovertheinitialTerm,withinterest,ofthefollowinglisted upgradedoradditionaltenantimprovementsinstalledbyLessortothePremises:twoelectronicallyand remotelycontrolledvehiclegates,additionalelectricdropsinthewarehouse,fourelectronicallyand remotelycontrolledroll-updoorstothewarehouse,anHVACsupplytothedesignatedITcloset. This additionalworkandtheircostsaretobeapprovedbyLesseepriortoinstallationandLessor’sactual costswillbeconfirmedwithpaidinvoicesplusa10%supervisionfeeandthenanadditionalRent calculationdocumentedinaLeaseAmendmentforsignaturebytheparties.

55.BuildingCompletion. LessorshalldeliverpossessionoftheleasedPremisestoLesseewithinfive(5) businessdaysoftheapprovedFinalconstructioninspectionbytheCityofClovis.Thatdateofpossession shallcommencetheOriginalTermofthisLeaseandshallbedocumentedbyaCommencementDate

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MemorandumsignedbybothLessorandLessee. IftheCommencementDateisnotthefirstdayofthe month,theperiodbetweenthatDateandthefirstofthedayofthenextfullmonthshallbeproratedand thebeginningofthatnextmonthshallcommencetheOriginalTerm.AsofthedateofthisLeasethe estimatedcompletiondateforthePremisesisSeptember1,2026.

LESSORAND LESSEEHAVE CAREFULLYREADAND REVIEWEDTHIS LEASEAND EACHTERMAND PROVISIONCONTAINED HEREIN,ANDBYTHEEXECUTION OFTHIS LEASESHOW THEIRINFORMED ANDVOLUNTARYCONSENT THERETO. THEPARTIESHEREBYAGREETHAT,ATTHE TIMETHISLEASE ISEXECUTED, THETERMSOF THISLEASE ARECOMMERCIALLY REASONABLEANDEFFECTUATETHEINTENT ANDPURPOSE OFLESSORAND LESSEEWITH RESPECTTOTHE PREMISES.

ATTENTION: NOREPRESENTATIONORRECOMMENDATIONIS MADEBYAIRCRE ORBYANY BROKERAS TOTHELEGAL SUFFICIENCY,LEGAL EFFECT,ORTAX CONSEQUENCESOF THISLEASE ORTHETRANSACTION TOWHICH ITRELATES. THEPARTIESAREURGED TO:

1. SEEKADVICE OFCOUNSELAS TOTHE LEGALANDTAXCONSEQUENCESOF THISLEASE.

2. RETAINAPPROPRIATECONSULTANTSTOREVIEW ANDINVESTIGATETHECONDITIONOF THEPREMISES. SAID INVESTIGATIONSHOULDINCLUDE BUTNOT BE LIMITEDTO:THEPOSSIBLE PRESENCEOFHAZARDOUS SUBSTANCES,THE ZONINGOF THEPREMISES,THE STRUCTURALINTEGRITY,THECONDITIONOF THEROOF ANDOPERATING SYSTEMS,AND THESUITABILITYOF THEPREMISES FORLESSEE'S INTENDEDUSE.

WARNING: IFTHE PREMISESARELOCATEDINA STATEOTHER THANCALIFORNIA, CERTAINPROVISIONSOF THELEASEMAYNEEDTO BEREVISEDTOCOMPLYWITH THELAWS OFTHE STATEINWHICH THEPREMISES ARELOCATED.

The parƟes heretohave executedthisLease atthe placeand onthedates specifiedabove theirrespecƟvesignatures.

Executedat:

On:

ByLESSOR:

Clovis Industrial Park, Inc.

By:

NamePrinted: Shelley Wathen-Cox
Title: President
Phone:

Fax:

Email:

By:

NamePrinted: Cindy Wathen
Title: Secretary
Phone:

Fax:

Email:

Address: c/o Siegel & Co., 5305 N. Fresno
Street #108, Fresno, CA, 93710
FederalID No.:

Executedat:

On:

ByLESSEE:

City of Clovis
By:

NamePrinted:

Title:

Phone:

Fax:

Email:

By:

NamePrinted:

Title:

Phone:

Fax:

Email:

Address:

FederalID No.:

BROKER
David S Siegel & Co., Inc.

AƩn: Douglas M. Holton
Title: President
Address: 5305 N. Fresno Street #108, Fresno,
CA, 93710
Phone: (559) 438-0733
Fax: (559) 432-0504
Email: [email protected]
FederalID No.: 58-2671775
BrokerDRE License#: 01391246
AgentDRE License#: 00966937
BROKER
n/a
AƩn: n/a
Title:

Address:

Phone:

Fax:

Email:

FederalID No.:

BrokerDRE License#:

AgentDRE License#:

AIRCRE * hƩps://www.aircre.com * 213-687-8777 * [email protected]

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NOTICE: Nopart oftheseworks maybe reproducedin anyformwithout permissionin wriƟng.

Report to the City Council

To: City Council
From: Public Utilities Department
Date: June 15, 2026
Staff: Glenn Eastes, Assistant Public Utilities Director Subject: Public Utilities – Approval – Award Non-Exclusive Franchise Agreements for Hauling of Construction and Demolition Debris, and Update the City’s Approved Hauler List.

Recommendation: Approve
Attachments:

1. C&D Hauler Agreements ATT 1 Approved Hauler List

Recommendation:

For the City Council to award non-exclusive construction and demolition (C&D) hauling franchise agreements for two (2) years to the following haulers:

1. Clovis Recycling, Inc. (dba: C&W Enterprises)

2. F-N-F Roll-Off Service

3. Accurate Cleaning Systems

4. Hinojosa Cleanup Service (HCS 007)

5. Green Valley Recycling, Inc. (dba: Kochergen Farms Composting, Inc.)

Executive Summary:

On May 6, 2013, the City Council adopted Ordinance 13-12, pertaining to the recycling and diversion of construction and demolition (C&D) debris. One of the requirements of this ordinance is that all entities hauling C&D debris in the City of Clovis must apply for and be awarded a non-exclusive C&D hauling franchise agreement. This year, the City received five applications, all of which are renewing their current agreements that are set to expire on June 30, 2026. Staff have reviewed the applications for completeness and are recommending that all applicants be awarded two-year non-exclusive C&D hauling franchise agreements and be added to the City’s updated list of approved haulers, which goes into effect on July 1, 2026.

Background:

AB 939 – the California Waste Management Act of 1989 (Public Resources Code §§ 40000 et seq.) – along with the California Green Building Standards Code (CCR, Title 24, Part 11), also known as CALGreen – require the City of Clovis to prepare, adopt, and implement source reduction and

recycling plans to reach landfill diversion goals. The City has achieved the State’s diversion goals, but AB 939 also requires the City to annually report to the State the quantities of waste that are disposed of in landfills and the quantities of waste that are diverted through recycling programs. CALGreen further instructs local jurisdictions to require contractors to develop and maintain a waste management plan and to divert a minimum of 65 percent of waste material.

Debris from construction, demolition, and renovation of buildings is the largest waste stream from Clovis that is not hauled by the City itself or by the City’s direct contractors. Prior to the adoption of Ordinance 13-12, the hauling of this waste was unregulated and the City had no means to track and report the quantities of this waste that were recycled or disposed of in landfills. The ordinance established non-exclusive C&D hauling franchises for haulers wishing to haul C&D debris generated within the City. The ordinance also prohibits non-franchised haulers from transporting C&D debris generated in Clovis. Lastly, the ordinance requires the franchised haulers to report to the City the quantities of this material that they recycle and dispose of in landfills and to pay the AB 939 surcharges associated with any C&D debris they dispose of in landfills.

The ordinance established a fee of $1,000 for each two-year non-exclusive franchise. The fee is based on the estimated costs for the staff time that will be spent to process each application and to review the quarterly reporting from each hauler. The ordinance was prepared with input from the Building Industry Association (BIA) and from local waste haulers.

The City’s C&D policy also establishes and annually updates the “Approved Hauler List” (Attachment 1), which lists every hauler that is currently authorized to haul C&D debris within the City of Clovis.

The list separates haulers based on the expiration date of their agreement; therefore, the updated list will include both the haulers that are being added or renewed this year and the haulers whose two- year agreements are in effect until next year.

Fiscal Impact:

There is no significant fiscal impact to the City associated with the award of these agreements. The application fee for the two-year non-exclusive franchise agreement to haul C&D debris is based on the estimated costs for staff time to process the applications and to review and process the quarterly reports from each hauler.

Reason for Recommendation:

Haulers must be franchised in order to haul C&D debris in the City of Clovis. All applicants recommended for approval have met the requirements for the non-exclusive franchise as outlined in the application form.

Actions Following Approval:

Originals of the signed franchise agreements will be forwarded to the City Manager for signature.

Staff will notify the haulers that they have been awarded the non-exclusive franchise agreements.

Staff will provide the Building Official with the list of the approved C&D haulers. Staff will monitor the franchised haulers’ reports for compliance with Ordinance 13-12.

Conflict of Interest:

None.

ATTACHMENT 1
EFFECTIVE 07-01-26

APPROVED CONSTRUCTION AND DEMOLITION DEBRIS (C&D) HAULERS

Approval valid through 07-01-2027

Republic Services of Fresno Nick’s Trucking, Inc.
5501 N. Golden State Boulevard 183 W. Indianapolis Ave.

Fresno, CA 93722 Fresno, CA 93705
(559) 275-1551 (559) 281-2267
www.republicservices.com

Industrial Waste & Salvage North Cal Hauling Company 3457 S. Cedar Avenue 5716 Folsom Boulevard, #285
Fresno, CA 93725 Sacramento, CA 95819
(559) 233-1159 (916) 381-9033
www.cagliaenvironmental.com www.northcalhauling.com

Kroeker, Inc. WM (Waste Management)
4627 S. Chestnut Avenue 4333 E. Jefferson Avenue
Fresno, CA 93725 Fresno, CA 93725
(559) 237-3764 (559) 834-4070
www.kroekerinc.com www.wm.com

Mid Valley Disposal Legacy Construction Debris Service 2721 S. Elm Avenue 1968 N. Gateway Boulevard, Ste. 103 Fresno, CA 93706 Fresno, CA 93727
(559) 237-9425 (559) 251-1605
www.midvalleydisposal.com

True Clean Construction Cleanup, Inc. Valley Dumpster Service LLC 2505 E. Oakdale Avenue 1187 N. Willow, Ste.103 #314
Tulare, CA 93274 Clovis, CA 93611
(559) 936-7557 (559) 999-5797
www.valleydumpsterservice.com
Dumpster Connection, LLC
1865 Herndon Avenue K-300
Clovis, CA 93611
(559) 894-8863
www.dumpsterconnection.org

Approval valid through 07-01-2028

C&W Enterprises, Inc. Hinojosa Cleanup Service (HCS 007) 1059 Hoblitt Avenue 777 Minnewawa Avenue, Suite 2
Clovis, CA 93612 Clovis, CA 93612
(559) 325-2128 (559) 647-2602
www.cnwenterprises.com www.hcs007inc.com

F-N-F Roll-Off Service, Inc. Green Valley Recycling Inc.

P.O. Box 11807 2365 E North Avenue
Fresno, CA 93775 Fresno, CA 93725
(559) 318-0644 (559) 266-2650
www.fnfrolloffservices.com www.greenvalleyrecycling.com

Accurate Cleaning Systems
802 Industrial Drive, Suite 200
Hollister, CA 95023
(831) 636-9767

Report to the City Council

To: City Council
From: Public Utilities Department
Date: June 15, 2026
Staff: Rey Empleo, Supervising Civil Engineer
Subject: Public Utilities – Approval – Bid Award for PUD 24-03, 2026 Landfill Gas Collection and Control System Improvements at the Clovis Landfill, to BSE General Engineering, Inc., in the Amount of $392,228.00; and Authorize the City Manager to Execute the Contract on Behalf of the City.

Recommendation: Approve
Attachments: None

Recommendation:

For the City Council to award a contract for PUD 24-03, 2026 Landfill Gas Collection and Control System Improvements at the Clovis Landfill, to BSE General Engineering, Inc., in the amount of $392,228.00; and authorize the City Manager to enter into an agreement on behalf of the City.

Executive Summary:

Staff is recommending that City Council authorize the City Manager to award and execute the contract with BSE General Engineering, Inc., in the amount of $392,228.00. BSE General Engineering, Inc., was the lowest responsible bidder from the bid opening that took place on May 26, 2026.

The project involves furnishing, installation, and/or construction of landfill gas collection control system and associated components, landfill gas extraction wells and wellheads, horizontal collectors, and all additional work necessary for the 2026 landfill gas collection and control system improvements at the Clovis Landfill.

Background:

The following is a summary of bids received on May 26, 2026.

BIDDERS BASE BID
BSE General Engineering, Inc. $392,228.00
Blue Flame Crew West, LLC $525,345.00
Biogas Engineering $674,087.27

ENGINEER'S ESTIMATE $661,530.00

All bids were examined and found to be in order, except for a few arithmetic errors on one bid that did not affect the order of the bid results. For this reason, BSE General Engineering, Inc. is the lowest responsible bidder. Staff has validated the lowest bidder’s contractor license status and bid bond.

Fiscal Impact:

This project was budgeted in the 2025-26 annual budget and is fully funded from the Refuse Enterprise funds as listed in the Community Sanitation Improvement section of the Community Investment Program. There are adequate funds in the Refuse Fund to pay for these costs.

Reason for Recommendation:

BSE General Engineering, Inc., is the lowest responsible bidder. There are sufficient funds available for the anticipated cost of this project.

Actions Following Approval:

1. The contract will be prepared and executed, subject to the contractor providing performance security that is satisfactory to the City.

2. Construction will begin approximately two (2) weeks after the contract execution and will be completed in forty-five (45) working days thereafter.

Conflict of Interest:

None.

Report to the City Council

To: City Council
From: Administration
Date: June 15, 2026
Staff: Andrew Haussler, City Manager
Subject: Consider Approval - Confirmation of City Manager's Appointment of Fire Chief.

Recommendation: Approve
Attachments: None

Recommendation:

For the City Council to confirm the City Manager's appointment of Jason Ralls as Fire Chief for the City of Clovis, effective August 1, 2026.

Executive Summary:

The City Manager has appointed Jason Ralls as Fire Chief, effective August 1, 2026, subject to confirmation by the City Council, as required by Clovis Municipal Code Chapter 2.2.103. Mr. Ralls served the City of Clovis Fire Department for 30 years in every sworn position, including 17 years as a Chief Officer. This appointment is necessitated by the retirement of current Fire Chief Chris Ekk on July 31, 2026. The City Manager has determined that Mr. Ralls' extensive operational, administrative, and fiscal experience, combined with his advanced academic credentials, make him exceptionally well-qualified to lead the Department. Funding for this position is included in the existing budget.

Background:

Current Fire Chief Ekk will retire on July 31, 2026, after a distinguished career of service to the Clovis community. Under Chief Ekk's leadership, the Clovis Fire Department experienced significant organizational growth, supported in part by resources provided through Measure Y. Chief Ekk leaves behind a strong and capable team, and the City is grateful for his many years of dedicated service.

Following Chief Ekk's announced retirement, the City Manager conducted a review of internal candidates and determined that Jason Ralls is the most qualified individual to assume the role of Fire Chief. Mr. Ralls has served the City of Clovis for 30 years, having held every sworn position within the Department. He has served as a Chief Officer for 17 of those years, accumulating extensive experience in operations management, departmental administration, fiscal oversight, and incident command on complex, large-scale emergency events. Mr. Ralls holds a Bachelor's Degree in Economics and a Master's Degree in Leadership and Organizational Studies, in addition to numerous professional certifications in fire service and emergency management.

Fiscal Impact:

The cost of this position is included within the City's existing adopted budget. No budget amendment is required.

Reason for Recommendation:

Pursuant to Clovis Municipal Code Chapter 2.2.103, the City Council is required to confirm Department Director appointments made by the City Manager. The City Manager has determined that Mr. Ralls' 30 years of service, 17 years of Chief Officer experience, advanced academic credentials, and demonstrated leadership capabilities make him exceptionally well-suited for this role.

Actions Following Approval:

Upon confirmation by the City Council, the City Manager will take all appropriate administrative actions to effectuate Mr. Ralls' appointment as Fire Chief, effective August 1, 2026.

Conflict of Interest:

None.

Report to the City Council

To: City Council
From: Administration
Date: June 15, 2026
Staff: Briana Parra, City Clerk
Subject: Consider Various Actions - Approval – Res. 26-___, Approving various actions required to conduct the November 3, 2026, General Municipal Election:

a. Calling and giving notice of the November 3, 2026, General Municipal Election for the purpose of electing three (3) members of the City Council representing Districts 1, 4, and 5, to serve a four (4) year term through November 2030; and

b. Requesting to Consolidate the General Municipal Election with the Statewide General Election; and authorizing the Fresno County Elections Division to conduct the November 3, 2026, Election; and

c. Establishing Conditions for the filing of Candidates’ Statements.

Recommendation: Approve
Attachments:

1. Calling Election ATT 1 Res. 26-___

Recommendation:

For the City Council to adopt a Resolution approving various actions required to conduct the November 3, 2026, General Municipal Election for the purpose of electing three (3) members of the City Council representing Districts 1, 4, and 5, to serve a four (4) year term through November 2030.

Executive Summary:

On November 3, 2026, the City of Clovis will conduct an election for three (3) City Council seats. As part of the City's transition from at-large elections to district-based elections, the seats to be filled will represent Districts 1, 4, and 5. Each elected Councilmember will serve a four-year term ending in November 2030.

The California Elections Code requires several actions to be taken in order to conduct a municipal election. Approval of staff's recommendation and the attached resolution will call and direct the City Clerk to publish notice of the election as required by law; request consolidation of the General

Municipal Election with the Statewide General Election to be held on November 3, 2026 as required by Clovis Municipal Code section 1.6.02 and Elections Code section 10403; request the County Board of Supervisors to authorize the Fresno County Elections Official to render services to the City relating to conducting the Clovis Municipal Election on behalf of the City as authorized by Elections Code section 10002; and establish the conditions for filing candidate statements.

Background:

1. Calling and Giving Notice of the Election; Nomination Period Pursuant to Elections Code section 12101, the 2026 General Municipal Election must be called prior to the opening of the nomination period. The Notice of Election that lists the time and date of the election and the offices to be filled must be published no sooner than July 1, 2026, and no later than July 13, 2026.

In accordance with Elections Code section 10220, the nomination period for the November 3, 2026, Municipal Election will open on July 13, 2026 (113 days before the election), and close on August 7, 2026 (88 days before the election). Although Elections Code section 10225, subd. (a) provides for the nomination period to be extended by five (5) calendar days when an incumbent eligible for re-election does not file nomination papers, that provision is not applicable for this election due to the transition from at-large to district voting. Because the District 1, 4, and 5 Council seats are being filled through the City's initial district-based election process, and all current Council members were previously elected at-large, the three Districts are deemed not to have an incumbent. Thus, Elections Code section 10225, subd.(b) provides that the five-day extended nomination period is not applicable.

2. Requesting to Consolidate the General Municipal Election with the Statewide General Election
Elections Code sections 10400 and 10403 authorize the City Council to call the General Municipal Election and request the County Board of Supervisors to consolidate the City’s General Municipal Election with the Statewide General Election on November 3, 2026.

3. Authorizing the Fresno County Elections Division to Conduct the Election The Fresno County Elections Division is the Registrar of Voters in Fresno County and is well-versed and capable of conducting the election, and has conducted the City’s regular municipal elections for decades. Staff recommends Council request the County Board of Supervisors to authorize the Fresno County Elections Division to conduct the municipal election as authorized by Elections Code section 10002.

The Resolution satisfies all requirements needed for the request to consolidate the municipal election with the statewide general election, including the City acknowledging that the election will be conducted by the Fresno County Elections Division in accordance with Elections Code section 10418, and the City agreeing to reimburse the County of Fresno in full for the election services performed by the County upon presentation of a bill to the City as required by Elections Code section 10002.

4. Establishing Conditions for Filing Candidate Statements Elections Code section 13307 governs the requirements of nonpartisan elective office candidate statements to be included in the county voter information guide, including the limitation that a statement be no more than 200 words. The Council is authorized to increase the candidate statement word limit from 200 to 400 words, but has not previously done so and has maintained the 200-word limit in previous elections. As authorized by Elections Code section 13307, subd. (d), the Council has historically required each candidate filing a candidate statement to make a payment to the County at the time the candidate files their nomination papers (including the candidate statement)

of the estimated pro rata share of the cost of printing, handling, translating, and mailing the candidate’s statement as part of the County’s voter information guide. Staff recommend maintaining the 200-word candidate statement limit and the requirement for any candidate wishing to submit a candidate statement for the County’s voter information guide to pay the cost as required by Elections Code section 13307. These conditions will help limit the size of the voter information guide and reduce the election costs in which the City will have to repay the County.

Fiscal Impact:

The City incurs a cost every other year to conduct an election. The estimated cost to conduct the regularly scheduled election has been budgeted and accounted for in the 2026-27 budget. Staff estimates the total cost for the November Election to be approximately thirty-five thousand dollars ($35,000.00).

Reason for Recommendation:

To conduct the 2026 General Municipal Election, the City Clerk’s Office must act in accordance with applicable provisions of law relating to general law cities in the State of California.

Actions Following Approval:

After Council approves the Resolution, the City Clerk will cooperate with, and provide the Resolution and any other necessary materials, to the Fresno County Elections Division to conduct the General Municipal Election in accordance with state law.

Conflict of Interest:

None.

Attachment 1
RESOLUTION 26-___

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CLOVIS CALLING AND GIVING NOTICE

OF THE HOLDING OF A GENERAL MUNICIPAL ELECTION TO BE HELD IN THE CITY OF CLOVIS ON TUESDAY, NOVEMBER 3, 2026, FOR THE ELECTION OF CERTAIN OFFICERS IN

THE CITY OF CLOVIS AND REQUESTING THE BOARD OF SUPERVISORS OF THE COUNTY

OF FRESNO TO CONSOLIDATE AND CANVASS THE GENERAL MUNICIPAL ELECTION TO BE HELD ON NOVEMBER 3, 2026, WITH THE STATEWIDE GENERAL ELECTION TO BE HELD ON THAT DATE PURSUANT TO CALIFORNIA ELECTIONS CODE SECTION 10400 ET SEQ.; TO

PERMIT THE COUNTY CLERK/REGISTRAR OF VOTERS OF THE COUNTY OF FRESNO TO

RENDER SPECIFIED SERVICES TO THE CITY OF CLOVIS RELATING TO THE CONDUCT OF

SAID GENERAL MUNICIPAL ELECTION PURSUANT TO CALIFORNIA ELECTIONS CODE SECTION 10002; AND AUTHORIZING REIMBURSEMENT FUNDS TO PAY FOR SAID SERVICES

WHEREAS, Clovis Municipal Code section 1.6.02 requires the City’s general municipal elections to be held on the date of the Statewide general election; and

WHEREAS, the next Statewide General Election will be held in the County of Fresno will take place on November 3, 2026; and

WHEREAS, in accordance with Clovis Municipal Code section 1.6.02 the City intends to call and order a General Municipal Election on Tuesday, November 3, 2026, for the election of three (3) members of the City Council representing Districts 1, 4, and 5 as part of the City's transition from at-large elections to district-based elections, each to serve a four (4) year term ending in November 2030; and

WHEREAS, in accordance with California Elections Code section 10400 et seq., the City Council desires to have the City’s General Municipal Election consolidated with the Statewide General Election, and to request the Board of Supervisors of the County of Fresno to consolidate said election with the Statewide General Election pursuant to California Elections Code section 10403 to be held on the same date and that, within the City of Clovis, the precincts, vote center locations, ballot drop box locations, and election officers of the two (2) elections be the same; the County Clerk/Registrar of Voters canvass the returns of the General Municipal Election; and the election be held in all respects as if there were only one (1) election; and

WHEREAS, in accordance with California Elections Code section 10002 the City Council desires to request the Board of Supervisors of the County of Fresno to permit and direct the county elections official to render specified services to the City of Clovis relating to the conduct of the City’s General Municipal Election; and

WHEREAS, Section 10002 of the Elections Code of the State of California requires the City of Clovis to reimburse the County of Fresno in full for the services performed upon presentation of a bill to the City of Clovis; and

WHEREAS, The City Council of the City of Clovis has determined that each candidate for elective office who submits a statement to be sent to the voters with the sample ballot in the voter information guide shall be charged a sum not greater than the actual prorated cost of printing, handling, and translating the candidate’s statement, if any, incurred by the City as a result of providing this service.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CLOVIS, CALIFORNIA, DOES HEREBY RESOLVE, DECLARE, DETERMINE AND ORDER AS FOLLOWS:

SECTION 1. A General Municipal Election is called and ordered for the City of Clovis to be held on Tuesday, November 3, 2026, for the purpose of the election three (3) members of the City Council in a transition from at-large to district seats representing Districts 1, 4, and 5, each to serve a four (4) year term ending in November 2030.

SECTION 2. Pursuant to the requirements of Section 10403 of the California Elections Code, the Board of Supervisors of the County of Fresno is hereby requested to consent and agree to the consolidation of the City’s General Municipal Election and the Statewide General Election to be held on November 3, 2026.

SECTION 3. In accordance with the provisions of Section 10403 of the California Elections Code, the City Council acknowledges that the consolidated election will be held and conducted in accordance with the provisions of law regulating the Statewide General Election pursuant to Section 10418 of the California Elections Code.

SECTION 4. In accordance with California Elections Code section 10002, the Board of Supervisors of the County of Fresno is requested to permit and direct the County Clerk/Registrar of Voters to render specified services to City of Clovis relating to the conduct of the City’s General Municipal Election and take any and all steps necessary for and related to the holding of the consolidated election in a manner consistent with law, including, without limitation: the provision of all election materials and equipment; publication of notices; the hiring, training and supervision of election officers and other election personnel; the printing and distribution of ballot materials; the translation of ballot materials; the collection of submitted ballots; the tallying and canvassing of votes; and the certification of election results.

SECTION 5. Pursuant to Section 10002 of the Elections Code of the State of California, the City Council of the City of Clovis authorizes reimbursement to the County of Fresno in full for the services to be performed as herein requested and that said sum be paid to the County of Fresno upon demand and presentation of a bill to the City of Clovis.

SECTION 6. The candidate shall, if he/she elects to submit a statement, not exceeding 200 words, to be included with the sample ballot and sent to the registered voters, pay all costs associated with said candidate statement in accordance with California Elections Code Section 13307, the candidate is required to make an estimated pre-payment to the County at the time the candidate files the nomination papers.

* * * * *

The foregoing Resolution was introduced and adopted at a regular meeting of the City Council of the City of Clovis at a regular meeting of the City Council held on June 15, 2026, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Dated: June 15, 2026

_____________________________ ______________________________ Mayor City Clerk

Report to the City Council

To: City Council
From: Administration
Date: June 15, 2026
Staff: Paul Armendariz, Assistant City Manager, Matt Lear, Deputy City Attorney Subject: Consider Introduction – Ord. 26-___, Approve an Ordinance authorizing the City Manager to execute a memorandum of understanding with the County of Fresno to enforce its Infectious Materials Ordinance within the City; and adding Chapter 8.19 to Title 8 of the Clovis Municipal Code to adopt by reference the County’s Ordinance to monitor and inspect privately funded laboratories within the City and to delegate enforcement authority to the County.

Recommendation: Approve
Attachments:

1. Fresno County Infectious Material ATT 1 Ord. 26

2. Fresno County Infectious Material ATT 2 Fresno County Ord 24-002

Recommendation:

For the City Council to approve the introduction of an Ordinance authorizing the City Manager to execute a memorandum of understanding with the County of Fresno (“County”) to enforce its infectious materials ordinance within the City of Clovis (“City”); and adding Chapter 8.19 to Title 8 of the Clovis Municipal Code to adopt by reference the County’s ordinance to monitor and inspect privately funded laboratories within the City and to delegate enforcement authority to the County.

Executive Summary:

Following abatement actions coordinated between the City of Reedley and the County of Fresno to address violations of an unpermitted and unlicensed laboratory in 2023, the County created and adopted its Infectious Materials Ordinance (the “Ordinance”) permitting it to monitor, inspect, and evaluate whether laboratories are being operated in accordance with applicable federal regulations within unincorporated portions of the County. The County also drafted a Memorandum of Understanding (MOU), included as Exhibit A to Attachment 1, to extend its jurisdiction to enforce the Ordinance in those cities that choose to participate by entering into the MOU and adopting the Ordinance.

The purpose of the Ordinance is to fill a gap in federal legislation regarding the regulation of "non- CLIA" laboratories. That is, laboratories that fall outside the definition of a "laboratory" under the Clinical Laboratory Improvement Amendments (CLIA), which are regulated by the Centers for

Medicare & Medicaid Services (CMS), the Food and Drug Administration (FDA), and the Centers for Disease Control (CDC). In the Reedley situation, the offending lab was privately funded, not properly licensed for the chemicals and pathogens it was using, and was primarily conducting research and manufacturing work. This meant that no single federal agency had clear jurisdiction to regulate or shut the laboratory down.

This Ordinance will not apply to CLIA operated laboratories which include commercial laboratories (e.g. Quest, LabCorp), doctor's offices that obtain a CLIA license or waiver from CLIA, and/or clinics operating under a CLIA license or waiver from CLIA. The Fresno County Public Health Department would create a team from its Hazardous Materials program and its Public Health Laboratory. This team would conduct annual on-site visits to confirm compliance with hazardous materials and laboratory operations.

City staff supports the City entering into the MOU and adopting the County's Ordinance.

Background:

The Reedley incident involved a non-CLIA laboratory operating within a warehouse in violation of the City's zoning ordinance and handling infectious agents and pathogens without proper oversight or licensing. However, the charges against the individual operating the lab (Jia Bei Zhu) were based on violations of FDA regulations for distributing misbranded COVID-19 test kits and several counts of wire fraud. Absent from his federal charges were any violations relating to his possession of certain pathogens or the nature of the research being conducted at the lab.

The federal oversight gap exists because certain agencies' jurisdiction is triggered only by specific chemical agents or pathogens within their purview, and other agencies' oversight is tied to the source of funding for the research being conducted. Because the Reedley lab was privately funded and many of the chemical agents and pathogens were unlabeled, it was unclear which federal agency, if any, had jurisdiction to regulate the facility.

The County's Ordinance addresses this gap by requiring all non-CLIA laboratories to obtain a permit from the County before operating and making it a violation of the County Municipal Code to operate without such a permit (County Municipal Code § 8.52.050). Non-CLIA laboratories are also required to receive an annual certificate of inspection from the County, for which the County may charge a fee (County Municipal Code § 8.52.060). These inspections are designed to evaluate compliance with the Hazardous Materials CUPA, the State's Medical Waste Management Program, the State's Animal Use Permit Program, and Cal/OSHA guidelines relating to the management of biological agents, and to take inventory of all chemicals and biologicals onsite (County Municipal Code § 8.52.070).

Fiscal Impact:

The fiscal impact to the City is expected to be minimal. The MOU provides that the City and County will establish appropriate reimbursement methods to support activities in responding to the County's Ordinance, and that each party will be responsible for reimbursing its own costs (MOU, §§ 3.1 & 3.2).

The reimbursement provisions do not contain any requirement for the City to directly reimburse the County for services performed in accordance with the Ordinance or any potential County code enforcement activities. The County will be responsible for recovering its own costs for services performed within the City, including through fees charged to laboratories for inspections. Accordingly, the financial burden on the City is expected to be low, and the MOU does not obligate the City to fund County enforcement operations.

Reason for Recommendation:

Staff recommends approval of the MOU and adoption of the Ordinance for the following reasons:
• The Ordinance specifically targets regulation of non-CLIA laboratories, which fall into a gray area of federal oversight and are not consistently regulated by CMS, FDA, or CDC. • It resolves jurisdictional ambiguity regarding enforcement between the City and the County and provides an expedited pathway for entering the City's jurisdiction to inspect and enforce violations.
• It creates a system to monitor privately funded laboratories that handle infectious agents that would otherwise go unmonitored.
• It utilizes County Public Health staff who have technical expertise regarding biohazard issues and laboratory inspections — expertise that City staff currently lacks. • It provides proactive public health regulation to support nuisance abatement, emergency response authority, and cost recovery. The burden on the City to adopt and implement the Ordinance is low.

Actions Following Approval:

If introduction of this Ordinance is approved, the Ordinance will return for adoption on July 6, 2026. If the Ordinance is adopted, the City Manager will execute the MOU with the County of Fresno, formally delegating authority to the County to inspect, monitor, and enforce the Ordinance against non-CLIA laboratories operating within the City.

Additionally, later this year City Planning Staff intends on bringing an ordinance amendment to the City’s Development Code that would require all projects that meet the definition of a “laboratory” to obtain a conditional use permit (CUP) with an included condition of approval requiring the laboratory to comply with the County Ordinance. This would provide an additional level of oversight for any new laboratory projects that come into the City. This would be presented to Council when Planning Staff bring the general Development Code update later this year.

Conflict of Interest:

None.