DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A Under no circumstances shall the insurance requirements and limits set forth in this Agreement be construed to limit Firm' s indemnification obligation or other liability hereunder.
Notwithstanding the foregoing, such obligation to defend, hold harmless and indemnify the City, its officials, officers, employees, agents and volunteers, shall not apply to the extent that such Claims are caused by the sole negligence or willful misconduct of that indemnified party.
7. REPORTS AND RECORDS
7. 1 Records. Firm shall keep complete, accurate, and detailed accounts of all time, costs, expenses, and expenditures pertaining in any way to this Agreement. Firm shall keep such books and records as shall be necessary to properly perform the Project Services required by this Agreement and to enable the Contract Officer to evaluate the performance of such Project Services.
The Contract Officer shall have full and free access to such books and records at all reasonable times, including the right to inspect, copy, audit, and make records and transcripts from such records.
7. 2 Reports. Firm shall periodically prepare and submit to the Contract Officer such reports concerning the performance ofthe Project Services as the Contract Officer shall require.
7. 3 Ownership of Documents. All drawings, specifications, reports, records, documents, memoranda, correspondence, computations, and other materials prepared by Firm, its employees, subconsultants, subcontractors and agents in the performance of this Agreement shall be the property ofCity and shall be promptly delivered to City upon request ofthe Contract Officer or upon the termination of this Agreement, and Firm shall have no claim for further employment or additional compensation as a result ofthe exercise by City of its full rights of ownership of the documents and materials hereunder. Firm may retain copies of such documents for its own use.
Firm shall have an unrestricted right to use the concepts embodied therein. Firm shall ensure that all of its subconsultants and subcontractors shall provide for assignment to City of any documents or materials prepared by them, and in the event Firm fails to secure such assignment, Firm shall indemnify City for all damages resulting therefrom.
7. 4 Release of Documents. Except to the extent otherwise required by law, no drawing, specification, report, record, document, or other material prepared by Firm, its employees, subconsultants, subcontractors and agents in the performance of Project Services shall be released publicly without the prior written approval of the Contract Officer.
8. ENFORCEMENT OF AGREEMENT
8. 1 California Law and Venue. This Agreement shall be construed and interpreted both as to validity and as to performance of the Parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim, or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Orange, State of Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
131Page
DocuSign Envelope ID BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A California, or any other appropriate court in such County, and Firm covenants and agrees to submit to the personal jurisdiction of such court in the event of such action.
8. 2 Waiver. No delay or omission in the exercise of any right or remedy of a nondefaulting Party on any default shall impair such right or remedy or be construed as a waiver. No consent or approval of City shall be deemed to waiver or render unnecessary City' s consent to or approval of any subsequent act of Firm. Any waiver by either Party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.
8.3 Rights and Remedies Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the Parties are cumulative and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.
8. 4 Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.
8. 5 Termination Prior to Expiration of Term. City reserves the right to terminate this Agreement, at any time, with or without cause, upon thirty (30) calendar days written notice to Firm, except that where the continuation of services would constitute a danger to health, safety or general welfare, the period of notice shall be such shorter time as may be appropriate. Upon receipt of the notice of termination, Firm shall immediately cease all Project Services, except as may be specifically approved by the Contract Officer. Firm shall be entitled to compensation for all Project Services rendered prior to receipt of the notice of termination and for any Project Services authorized by the Contract Officer thereafter.
8. 6 Termination for Default of Firm.
8. 6. 1 Firm' s failure to comply with any provision of this Agreement shall constitute a default.
8. 6.2 Ifthe Contract Officer determines that Firm is in default in the performance of any of the terms or conditions of this Agreement, he/ she shall notify Firm in writing of such default. If such default is capable of being cured, Firm shall have ten( 10) calendar days, or such longer period as City may designate, to cure the default by rendering satisfactory performance. In the event Firm fails to cure its default within such period of time, or if such default is not capable of being cured, City shall have the right, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice of any remedy to which Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
14IPage
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A City may be entitled at law, in equity, or under this Agreement. Firm shall be liable for any and all reasonable costs incurred by City as a result of such default. Compliance with the provisions of this section shall not constitute a waiver of any City right to take legal action in the event that the dispute is not cured, provided that nothing herein shall limit City' s right to terminate this Agreement without cause pursuant to Section 8. 5.
8. 6.3 Iftermination is due to the failure of Firm to fulfill its obligations under this Agreement, City may, after compliance with the provisions of Section 8. 6.2, take over the Project Services and prosecute the same to completion by contract or otherwise, and Firm shall be liable to the extent that the total direct and indirect costs for completion ofthe Project Services required hereunder exceeds the Maximum Contract Amount, and City may withhold any payments to Firm for the purpose of set- off toward the cost of completion of the Project Services. The withholding or failure to withhold payments to Firm shall not limit Firm' s liability for completion ofthe Project Services as provided herein.
8. 7 Attorneys' Fees. In the event any dispute between the Parties with respect to this Agreement results in litigation or any non judicial proceeding, the prevailing Party shall be entitled, in addition to such other relief as may be granted, to recover from the non- prevailing Party all reasonable costs and expenses, including but not limited to reasonable attorneys' fees, expert witness fees, court costs and all fees, costs, and expenses incurred in any appeal or in collection of any judgment entered in such proceeding. To the extent authorized by law, in the event of a dismissal by the plaintiff or petitioner ofthe litigation or non judicial proceeding within thirty( 30) calendar days of the date set for trial or hearing, the other Party shall be deemed to be the prevailing Party in such litigation or proceeding. For purposes of this section, " Reasonable attorney fees" shall be calculated by multiplying the actual number of hours reasonably expended by the attorney( s) handling the dispute on behalf of the prevailing Party by the hourly rate actually paid by the prevailing Party, but in no case shall the hourly rate exceed Two Hundred and Fifty Dollars 250. 00) per hour.
9. CITY OFFICERS AND EMPLOYEES: NON- DISCRIMINATION
9. 1 Non- liability of City Officers and Employees. No officer or employee ofthe City shall be personally liable to the Firm, or any successor- in-interest, in the event of any default or breach by the City or for any amount which may become due to the Firm or to its successor, or for breach of any obligation ofthe terms ofthis Agreement.
9. 2 Covenant Against Discrimination. Firm covenants that, by and for itself, its heirs, executors, assigns, subcontractors, subconsultants and all persons claiming under or through them, that there shall be no discrimination or segregation in the performance of or in connection with this Agreement regarding any person or group of persons on account of race, disability, medical condition, color, creed, religion, sex, sexual orientation, marital status, age, national origin, or ancestry. Firm shall take affirmative action to insure that applicants and employees are treated Professional Services Agreement—Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
15IPage
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A without regard to their race, disability, medical condition, color, creed, religion, sex, sexual orientation, marital status, national origin, or ancestry.
10. MISCELLANEOUS PROVISIONS
10. 1 Confidentiality. Information obtained by Firm in the performance of this Agreement shall be treated as strictly confidential and shall not be used by Firm for any purpose other than the performance of this Agreement without the written consent of the Contract Officer.
10.2 Patent and Copyright Infringement.
10. 2. 1 To the fullest extent permitted by law, and in lieu of any other warranty by City or Firm against patent or copyright infringement, statutory or otherwise, it is agreed that Firm shall defend at its expense any claim or suit against City on account of any allegation that any item furnished under this Agreement, or the normal use or sale thereof arising out of the performance of this Agreement, infringes upon any presently existing U. S. letters patent or copyright and Firm shall pay all costs and damages finally awarded in any such suit or claim, provided that Firm is promptly notified in writing of the suit or claim and given authority, information and assistance at Firm' s expense for the defense of same, and provided such suit or claim arises out of, pertains to, or is related to the alleged negligence, recklessness or willful misconduct of Firm. However, Firm will not indemnify City if the suit or claim results from City' s alteration of a deliverable where such alteration created the infringement upon any presently existing U.S. letters patent or copyright.
10. 2.2 Firm shall have sole control of the defense of any such claim or suit and all negotiations for settlement thereof, Firm shall not be obligated to indemnify City under any settlement made without Firm' s consent or in the event City fails to cooperate in the defense of any suit or claim, provided, however, that such defense shall be at Firm' s expense. If the use or sale of such item is enjoined as a result of the suit or claim, Firm, at no expense to City, shall obtain for City the right to use and sell the item, or shall substitute an equivalent item acceptable to City and extend this patent and copyright indemnity thereto.
10. 3 Notices. Any notice, demand, request, consent, approval, or communication either Party desires or is required to give to the other Party or any other person shall be in writing and either served personally during normal hours of operation ofthe Party receiving the notice, or sent by pre-paid, first-class mail to the address set forth below. Either Party may change its address by notifying the other Party of the change of address in writing. Notice shall be deemed communicated on the day personally served, or two ( 2) business days from the date of mailing if mailed as provided in this section. Additionally, notices by email will be considered legal notice if such communications include the following text in the Subject field: FORMAL LEGAL NOTICE— Housing Element Update through the HCD Leap Grants Program.
Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
16IPage
DocuSign Envelope ID: BC0B1443- 71CB-4C66- 99AE- 92BE3FE8983A To City: Ron Noda, Acting Deputy City Manager
City of Los Alamitos
3191 Katella Ave.
Los Alamitos, CA 90720
csimmons@cityoflosalamitos. org
With copy to:
Michael S. Daudt, City Attorney
Woodruff, Spradlin& Smart
555 Anton Blvd., Suite 1200
Costa Mesa, CA 92626
mdaudt@wss- law.com
To Firm: Nicole Sauviat Criste, Vice President
TERRA NOVA PLANNING & RESEARCH, INC.®
42635 Melanie Place, Ste 101
PALM DESERT, CA. 92211
ncriste@terranovaplanning. com
10.4 Entire Agreement: Amendments in Writing. This Agreement constitutes the entire agreement between the Parties and is intended as an integrated agreement, superseding all prior negotiations, arrangements, agreements, representations, and understandings, if any, made by or among the Parties with respect to the subject matter hereof. No amendments or other modifications of this Agreement shall be binding unless executed in writing by both Parties hereto, or their respective successors, assigns, or grantees.
10.5 Severability. In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement, which shall be interpreted to carry out the intent of the Parties hereunder.
10. 6 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties' successors and assignees.
10.7 Third Party Beneficiary. Except as expressly provided herein, nothing contained in this Agreement is intended to confer, nor shall thi A' reement be construed a conf• rrin• ts. including. without limitation. any ri hts as third-party beneficiary or otherwis upon any entity or person not a party hereto.
Recitals. The above- stated Recitals are hereby incorporated into the Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
171Page
DocuSign Envelope ID: BCOB1443- 71CB-4C66- 99AE- 92BE3FE8983A Agreement as though fully set forth herein and each Party acknowledges and agrees that such Party is bound, for purposes of this Agreement. b the same.
10. 9 Prevailing Wages. Firm is aware of the requirements of California Labor Code Section 1720, et seq., and 1770, et seq., as well as California Code of Regulations, Title 8, Section 16000, et seq., (" Prevailing Wage Laws"). Firm agrees to fully comply with all applicable federal and state labor laws( including, without limitation, if applicable, the Prevailing Wage Laws). It is agreed by the Parties that, in connection with the work or Project Services provided pursuant to this Agreement, Firm shall bear all risks of payment or non- payment of prevailing wages under California law, and Firm hereby agrees to defend, indemnify, and hold the City, its officials, officers, employees, agents and volunteers, free and harmless from any claim or liability arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. The foregoing indemnity shall survive termination of this Agreement.
10. 0 Corporate Authority. Each ofthe undersigned represents and warrants that( i) the Party for which he/ she is executing this Agreement is duly authorized and existing, ( ii) he/ she is duly authorized to execute and deliver this Agreement on behalf of the Party for which he/ she is signing, ( iii) by so executing this Agreement, the Party for which he/ she is signing is formally bound to the provisions of this Agreement, and ( iv) the entering into this Agreement does not violate any provision of any other agreement to which the Party for which he/ she is signing is bound.
SIGNATURES ON NEXT PAGE]
Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
18IPage
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A IN WITNESS WHEREOF, the Parties have executed and entered into this Agreement as of the date first written above.
City"
City of Los Alamitos
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Mark A. hrico 4/ 28/ 2021
Mayor
APPROVED AS TO FORM. ATTEST:
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Professional Services Agreement— Terra Nova Planning and Research, Inc.
HCD LEAP Grants Program
City of Los Alamitos
19 I Page
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A Exhibit A
Scope of Work
for
City of Los Alamitos
Housing Element Update
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A I
f.
PROPOSAL TO PREPARE
N.
tTHE CITY OF LOS ALAMITOS
HOUSING ELEMENT UPDATE
1 , 2021- 2029)
Prepared for:
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720
Prepared by:
L J Terra Nova Planning & Research, Inc.®
42635 Melanie Place, Suite 101
Palm Desert, CA 92211
April 2021
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A I • 7? Terra Nova/ City of Los Alamitos
4a, Housing Element Update
W tw 4 J
City of Los Alamitos
Housing Element Update ( 2021- 2029)
Table of Contents
I. SCOPE OF WORK 4
II. FIRM OVERVIEW AND KEY PERSONNEL 7
A. Terra Nova 7
B. Staff Qualifications 7
III. EXPERIENCE AND REFERENCES 9
IV. FEE SCHEDULE AND COST ESTIMATE 10
A. Terra Nova Fee Schedule 10
B. Cost Estimate 11
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A r
J TERRA NOVA PLANNING & RESEARCH, INC. ®
April 8, 2021
Mr. Tom Oliver
Associate Planner
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720
RE: Proposal to Prepare Housing Element Update
Dear Mr. Oliver:
Terra Nova Planning & Research is pleased to submit this proposal for the preparation of the City' s 6th Cycle Housing Element Update, for the period from 2021 to 2029.
Terra Nova has been providing planning and environmental consulting services in southern California since 1984.
Our Housing Element experience started in 1987, and we have prepared Housing Elements for each update cycle since that time, primarily for the cities of the Coachella Valley in Riverside County, and the High Desert in San Bernardino County. We are currently preparing Housing Elements for the cities of Cathedral City, Rancho Mirage, Palm Desert, La Quinta and Twentynine Palms, and the Town of Apple Valley ( please see Firm Overview and Personnel section of our proposal).
I will be the City' s prime contact, should we be selected for this project. I can be reached at 760- 341- 4800, or by email at ncriste@terranovaplanning. com. Our address and telephone number is provided below.
We look forward to having the opportunity to discuss this proposal with you further. If you have any questions or require additional information, please feel free to contact me.
Sincerely,
71 .
Nicole Sauviat Criste
Principal
42635 MELANIE PLACE, SUITE 101, PALM DESERT, CA 92211 ( 760) 341- 4800
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE-92BE3FE8983A sl' Terra Nova/ City of Los Alamitos
Housing Element Update
I. SCOPE OF WORK
The Housing Element Update is governed by the requirements of State law, and has been further constrained by the State' s 2018 and 2019 legislative sessions, which added requirements to Housing Elements that further define the City' s facilitation of the development of housing for all income levels.
Our scope of work is provided below. The scope is followed by a project schedule that assumes a realistic pace for the work, while meeting the mandates of law that the City' s Housing Element Update must be adopted by February 15, 2022 ( within 120 days of the due date of October 15, 2021).
Scope of Work
Meetings & Consultation: Terra Nova will prepare for and attend one Kick Off meeting and five 5) meetings with staff during the preparation of the Housing Element Update. The Kick Off meeting will include refinement of project schedule; a review of data needs and background information that Terra Nova will need City staff help with; and discussion of policy direction and site inventory to meet the 2021- 2029 RHNA allocation. We have assumed that most if not all of the meetings will be held via Zoom or similar video conferencing application.
Community Outreach: In coordination with City Staff, prepare for, coordinate and staff two community workshops geared toward stakeholders such as affordable housing developers, public agency staffs, and the public, and document the input received from all parties. The format and timing of the two workshops will be determined at the Kick Off meeting.
Research and Data Collection:
o Develop a list of data needs for the update, including but not limited to building permit data, existing affordable housing projects, activities of the City during the 2014- 2021 planning period, housing conditions survey, and other materials for City staff research. o Review the City' s General Plan, Zoning Ordinance and applicable Specific Plans and develop clear understanding of the land use context for the Housing Element. This review will include checking existing Zoning standards and requirements which may have been affected by recent State legislation, including accessory dwelling units and junior accessory units, density bonuses, standards and definitions for reasonable accommodation, single room occupancy, transitional and supportive housing, etc. This task will result in a compiled list of required amendments, as needed.
o Review existing policies and programs of the Housing Element, and develop analysis of progress made in addressing each of them. Identify policies and programs that require carryPage 4 of 11
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A h Terra Nova/ City of Los Alamitos
Housing Element Update
over into the Update, eliminate those that have been completed, and determine new programs that may be necessary for the 2021- 2029 planning period. o Update demographic section to include current ( 2019 and 2020, as available) information, such as US Census annual Community Surveys, SCAG, California Department of Finance, current housing stock and values, etc.
o Work with staff to determine what sites will be needed in the land inventory to meet the City' s RHNA. As required by the State' s 2018 Housing Package ( AB 1397), the inventory will include assessor' s parcel numbers, demonstrate that the sites are serviced by utilities and infrastructure, and include an analysis of realistic density.
Housing Element Drafting: Incorporate research and documentation into revised Housing Element document. Expand constraints analysis as required by AB 879, including review of Municipal Code requirements that may impact the cost of housing, non- governmental constraints related to reduced density proposals, etc. Assure that programs are included in the revised Element, if necessary, to remove all constraints. o Revise all other sections of the Element to assure compliance with current State requirements, including funding sources, agencies providing affordable housing, special needs housing analysis, etc.
o Develop new and amend existing goals, policies and programs to reflect the research and documentation described above. Include defined timelines and responsible departments/ agencies for all activities.
HCD Submittal: Submit the draft document for State review, and coordinate response to comments from HCD with City staff, and draft modifications to Update as necessary. For purposes of this proposal, we have assumed two (2) reviews by HCD, not including the certification review.
Following adoption by the City Council, Terra Nova will submit the document for certification by HCD, and coordinate the process on behalf of the City.
CEQA Documentation: Prepare CEQA Initial Study and Checklist, Negative Declaration and public notice documentation.
Public Hearings: Terra Nova will work with City staff in developing staff reports and resolutions for the Planning Commission and City Council, and present the Housing Element to both bodies for adoption. One hearing is expected for each body' s action on the document.
Project Schedule
The project schedule is provided below. It is consistent with the tasks described above.
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A 4 Terra Nova/ City of Los Alamitos
Housing Element Update
City of Los Alamitos Housing Element Update
Project Schedule
Task 5/ 21 6/ 21 7/ 21 8/ 21 9/ 21 10/ 21 11/ 21 12/ 21 1/ 22 2/ 22 Meetings&
Consultation
Community
Workshops( 2)
Research& Data
Collection
Housing Element
Drafting
HCD Review, 1st
Draft( 60 days)
Amend Element
per HCD Comments
HCD Review 2nd
Draft( 60 days)
Prepare& Circulate
Initial Study( 20
days)
Planning
Commission
City Council
Hearing
File NOD
Adopted Document 2/ 15-
Review by
4/ 15
HCD/ Certification
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A z
Terra Nova/ Cityof Los Alamitos
t,.,
Housing Element Update
II. FIRM OVERVIEW AND KEY PERSONNEL
A. Terra Nova
Terra Nova has been providing planning and environmental services to a wide range of public agencies, including all cities of the Coachella Valley, the County of Riverside, the Towns of Apple Valley and Yucca Valley, the City of San Bernardino, and other agencies, including the Coachella Valley Association of Governments, College of the Desert and the Coachella Valley Water District since 1984. During that time, we have prepared Housing Elements and Updates for multiple jurisdictions, starting in 1987, when we prepared the City of Rancho Mirage' s Housing Element for the 2nd Cycle. Since that time, we have completed a varying number of Elements, ranging from 4 to 8 per cycle. We are gratified that our client cities have called on us repeatedly to update their Housing Elements multiple times.
The following section provides brief resumes of Terra Nova key personnel. All personnel listed will be fully involved in the project, and have availability to perform the scope of work detailed in this proposal.
B. Staff Qualifications
Nicole Sauviat Criste, Principal
Ms. Criste has led Terra Nova' s Housing Element efforts since the firm' s inception. Her experience with Housing Elements has included Palm Desert ( 3rd 4th, 5th and 6t" Cycles), Rancho Mirage ( 2nd, 3rd, 4th, 5th and 6t" Cycles), Cathedral City ( 3rd, 4th and 6t" Cycles), Palm Springs ( 4th and 5th Cycles), Blythe ( 2nd 3rd and 4th Cycles), Yucca Valley( 2nd, 3rd and 4th Cycles), and Apple Valley( 4th, 5th and 6t" Cycles). For the 3rd Cycle ( 1998- 2006), Ms. Criste completed and received certification from HCD for five Housing Elements.
In the 4th Cycle ( 2006- 2013), Ms. Criste completed and received certification from HCD for seven Housing Elements, and for the 5th Cycle ( 2013- 2021), she completed and certified five Elements.
Since 1981, Ms. Criste has conducted extensive land use analysis, development design, market research analysis and marketing strategy development. Her land use/ market feasibility experience has included the analysis and application of demographic research to determine real estate and development trends, focused marketing campaigns, and to gauge project feasibility.
With Terra Nova since 1985, Ms. Criste has researched and assisted in the preparation of environmental documents for all the cities of the Coachella Valley, the U. S. Bureau of Indian Affairs, Federal Highway Administration, Farmer' s Home Administration and the Economic Development Administration.
Ms. Criste also works extensively in current planning, assisting the cities of La Quinta, Palm Springs, Banning, San Bernardino, and Yucca Valley in the processing of applications ranging from Specific Plans
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A A-.,-\
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ifl Terra Nova/ City of Los Alamitos
Housing Element Update
to Use Permits. Her experience in this area ranges from the staffing of planning department to individual case work and preparation of Initial Studies and Mitigation Monitoring Programs.
Ms. Criste is a graduate of Scripps College with a Bachelor of Arts degree in European Studies.
Andrea Randall, Senior Planner
Ms. Randall has been a professional planner since 1993 and has been with Terra Nova since 1998. She has worked on a variety of General Plan and Specific Plan projects, and has prepared and managed numerous CEQA and NEPA analyses. Her most recent experience with Housing Element Updates includes the La Quinta, Apple Valley and Twentynine Palms updates for the 6th Cycle.
She has an in- depth knowledge of socio- economics and has prepared several analytical models of communities of the Coachella Valley, and is principal author of General Plan environmental justice and demographics analyses.
Ms. Randall played an important role in a 10,000-acre annexation and associated analysis on lands near the Colorado River, and has assisted in securing state and federal incidental take permits for major developments in the Coachella Valley. Ms. Randall has also conducted predevelopment planning analysis for a variety of projects, including the COD West Valley Campus, Paradise Valley Market Feasibility Study and Fiscal Impact Analysis, the Coachella Valley Multiple Species Habitat Conservation Plan Fiscal Impact Analysis, and analyses for a number of annexations and residential subdivisions.
Ms. Randall graduated Magna Cum Laude with a Bachelor' s degree in Urban Affairs and Planning from the Virginia Polytechnic Institute and State University.
Kelly Clark, Associate Planner
Ms. Clark joined Terra Nova in 2011. She is a graduate of the University of California, Berkeley with a Bachelor of Science degree in Conservation and Resource Studies. Ms. Clark' s coursework emphasized sustainable urban development, environmental policy and community design. Ms. Clark provided demographic and research support for the five Housing Elements completed by Terra Nova in the 5th Cycle, and is principal author of Cathedral City' s 6th Cycle update.
She has assisted in the preparation of the Green Building, Benchmarking and Energy Management Programs for CVAG' s Green for Life project, the current update to the Apple Valley Climate Action Plan and other similar projects. Ms. Clark has also provided research and analysis required for CEQA and NEPA documents for various development projects throughout the Coachella Valley. She contributed to the preparation of the College of the Desert Indio Educational Center EIR and expansion Mitigated Negative Declaration. She played a key role in the SCAG/ Rancho Cucamonga Foothill Boulevard BRT corridor study, and has been intimately involved in land use and socio- economic research, public outreach and participation, and the collection of data and information.
DocuSign Envelope ID: BC0B1443- 71CB- 4C66- 99AE- 92BE3FE8983A 41,' Terra Nova/ City of Los Alamitos
Housing Element Update P
III. EXPERIENCE AND REFERENCES
Terra Nova has completed Housing Element Updates for many of the cities of the Coachella Valley, and for cities of similar size elsewhere in Riverside and San Bernardino counties, as described above. We provide the following similar projects with references.
City of Palm Desert Housing Element Update
Terra Nova updated the Housing Element for the City of Palm Desert for the 3rd, 4th and 5th Cycle planning periods. For the most recent Update, the City' s limited higher density vacant land inventory posed the greatest challenge, and extensive work was undertaken to identify and characterize sites for re- zoning to satisfy the City' s RHNA. Negotiations with HCD were extensive, but resulted in certification by HCD.
Reference: Mr. Eric Ceja, Assistant Director of Community Development, City of Palm Desert ( 760) 346- 0611
City of Rancho Mirage Housing Element Update
Terra Nova updated the Housing Element for the City of Rancho Mirage for the last four update Cycles.
The primary issue with the most recent Update was associated with the vacant land inventory, and the need to restrict lands within the newly adopted Section 19 Specific Plan for affordable housing, which provided the only area in the City with high density residential land use designations. The element was certified by HCD and adopted by the City Council.
Reference: Mr. Jeremy Gleim, Director of Development Services, City of Rancho Mirage, (760) 328- 2266.
City of Palm Springs Housing Element Update
Terra Nova updated the City of Palm Springs' Housing Element for the 4th and 5th Cycle. As with most Coachella Valley cities, the issues associated with the sites inventory was critical to both updates.
Another significant issue was the patchwork of Agua Caliente Band of Cahuilla Indians lands, which could not be included in the inventory. The element was certified by HCD and adopted by the City Council.
Reference: Mr. Edward Robertson, Principal Planner, City of Palm Springs, 760-323- 8245 Town of Apple Valley Housing Element Update
Terra Nova updated the Housing Element for the Town of Apple Valley in conjunction with a major General Plan Update, and again for the 5th Cycle update. The primary issues associated with this Housing Element related to Apple Valley' s very low density development and its ability to meet affordable housing needs as a result. The Housing Element and General Plan addressed density issues through the creation of a Mixed Use designation, and the expansion of the inventory of High Density lands. The element was certified by HCD and adopted by the Town Council.
Reference: Ms. Lori Lamson, Director of Community Development, Town of Apple Valley, ( 760) 240- 7000, extension 7204
DocuSign Envelope ID: BC0B1443- 71CB- 4C66-99AE- 92BE3FE8983A Terra Nova/ City of Los Alamitos
Housing Element Update
IV. FEE SCHEDULE AND COST ESTIMATE
A. Terra Nova Fee Schedule
Terra Nova invoices its clients on a cost- basis using an hourly billing system. Reimbursable expenses are charged on a cost basis, except where otherwise indicated. The current fee schedule is provided below:
Terra Nova Staff Hourly Rate
Principal Planner 195. 00
Senior Planner 160. 00
Associate Planner 140. 00
Assistant Planner 115. 00
Graphic Design Specialist 65. 00
Administrative Assistant 45. 00
REIMBURSABLES
Photo Copies
8. 5" X 11" BW) 0. 15 ea.
8. 5" X 11" Color) 0. 30 ea.
11" X 17" BW) 0. 30 ea.
11" X 17" Color) 0. 60 ea.
Large Format Plots
BW 1. 00/ S. F.
Color 5. 00/ SF
Telephone Toll Charges Cost
FAX Transmittals Cost
Reproduction, Special photographic services,
document printing, aerial photogrammetry, postage, etc. Cost
DocuSign Envelope ID: BCOB1443- 71CB- 4C66- 99AE- 92BE3FE8983A 4-12
Terra Nova/ City of Los Alamitos
Housing Element Update
B. Cost Estimate
City of Los Alamitos
Housing Element Update
Project Budget
City Team Meetings, Internal Meetings, etc. 7, 875. 00
Public Outreach - 2 Workshops 5, 360. 00
Review of City Documents & Existing Housing Element 5, 310. 00 Update Housing Element 23, 850. 00
HCD Reviews and Amendments ( 2 reviews) 5, 850. 00
CEQA Initial Study, NOI, NOD 6, 180. 00
Project Management, Staff Report Support 4, 875. 00
Preparation and Attendance at Public Hearings ( 2) 2, 340. 00 Administrative Support 1, 800. 00
Miscellaneous Office Expenses: copies, postage, etc. 1, 500. 00 Total Housing Element Update Costs 64, 940. 00
TERRA NOVA PLANNING & RESEARCH, INC. ®
42635 MELANIE PLACE, SUITE 101, PALM DESERT, CA 92211 (760) 341-4800 February 2, 2023
Mr. Tom Oliver
Associate Planner
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720
RE: Housing Element Status
Dear Mr. Oliver:
As you are aware, completion of the Housing Element Update has been delayed by multiple factors. As of this date, we have received conditional approval from the Department of Housing and Community Development (HCD), pending re-adoption by the City Council. If the Council takes action this month, we will then resubmit to HCD, and would receive final HCD approval on or about June 30, 2023.
The HCD approval is contingent on our also providing them with the rezoning Ordinance when we resubmit. So assuming that both items proceed to Council together, the timeline above should remain consistent.
Please feel free to contact me if you have any questions.
Sincerely,
Nicole Sauviat Criste
Principal
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: February 21, 2023 ITEM NUMBER: 10J
To: Mayor Tanya Doby & Members of the City Council
Presented By: Ron Noda, Development Services Director
Subject: Lease Agreement with The Institute of Electrical and Electronic Engineers for Warehouse Space
SUMMARY
This item seeks authorization for a three (3) year lease agreement between the City of Los Alamitos and The Electrical and Electronic Engineers for warehouse space at 10662 Los Vaqueros Circle for $12,000 per month.
RECOMMENDATION
Authorize the Mayor to execute a three (3) year lease agreement with The Institute of Electrical and Electronic Engineers for the use of warehouse space located at 10662 Los Vaqueros Circle in an amount not to exceed $453,960.
BACKGROUND
The City is in need of warehouse space as current facilities are insufficient to properly house equipment and vehicles. Various locations around the City were explored. 10662 Los Vaqueros Circle is being recommended. The site has approximately 8,000 sq. ft. of warehouse space and an adjoining approximate 8,000 sq. ft. outdoor parking space.
DISCUSSION
The Los Alamitos Civic Center sits on 1.39 acres and includes the Council Chamber, City Hall, the Police Department, Public Works' garages, and parking spaces for public, employees, and City vehicles. The current space is inadequate to house all the City's supplies, equipment, and vehicles. Staff sought out various locations in Los Alamitos and determined that 10662 Los Vaqueros Circle was the best choice for the City's needs. The site will include approximately 8,000 sq. ft. of indoor warehouse space and approximately 8,000 sq. ft. of parking/outdoor space.
The indoor warehouse space is split up into four garage stalls. The goal is to have one stall that will house Police equipment, one stall containing Recreation & Community Services equipment, and two stalls going to Development Services for storage needs. The parking/outdoor area will house the City's waste containers, vehicles, and equipment (i.e. the stage, traffic equipment, trailers, message boards, light towers, etc.) This will free up the Civic Center for parking of vehicles and open up office space for new offices and additional locker room space.
FISCAL IMPACT
The proposed lease agreement is for a period of three years from March 1, 2023 to February 28, 2026. The initial total due upon execution of the lease agreement is $24,000, which includes a security deposit of $12,000 and first month rent of $12,000. The base monthly rent due at the beginning of each month will be $12,000 for an annual first year total cost of $144,000.
Each year, the base monthly rent will increase by five (5) percent. The second year's monthly rent will be $12,600 and the third year's monthly rent will be $13,230. The total three-year agreement cost for leasing of the warehouse space will be $453,960. If approved, the FY 22- 23 budget and upcoming fiscal year budgets will be revised to incorporate the added costs and be expended out of the non-departmental fund.
Sufficient funding of $60,000 for the first year is available in FY2022-23. Future years will be incorporated into the budget.
Attachment: 1. Los Vaquaros Warehouse Lease Agreement
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STANDARD INDUSTRIAL/COMMERCIAL MULTITENANT LEASE GROSS
1. Basic Provisions ("Basic Provisions").
1.1 ParƟes. This Lease ("Lease"), dated for reference purposes only January 12, 2023 , is made by and between The Institute of Electrical and Electronics Engineers ("Lessor") and The City of Los Alamitos ("Lessee"), (collecƟvely the "ParƟes", or individually a "Party").
1.2(a) Premises: That certain real property, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known as (street address, unit/suite, city, state, zip): 10662 Los Vaqueros Circle, Los Alamitos, CA 90720 ("Premises"). The Premises are located in the County of Orange , and are generally described as (describe briefly the nature of the Premises and the "Project"): approximately 8,000 SF warehouse portion located in 10662 Los Vaqueros Circle . In addiƟon to Lessee's rights to use and occupy the Premises as hereinaŌer specified, Lessee shall have nonexclusive rightsto any uƟlity raceways of the building containing the Premises("Building") and to the Common Areas (as defined in Paragraph
2.7 below), but shall not have any rightsto the roof, or exterior walls of the Building or to any other buildings in the Project. The Premises, the Building, the Common Areas, the land upon which they are located, along with all other buildings and improvementsthereon, are herein collecƟvely referred to asthe "Project." (See also Paragraph 2)
1.2(b) Parking: 2 / 1,000 unreserved vehicle parking spaces. (See also Paragraph 2.6)
1.3 Term: three (3) years and 0 months ("Original Term") commencing March 1, 2023 ("Commencement Date") and ending February 28, 2026 ("ExpiraƟon Date"). (See also Paragraph 3)
1.4 Early Possession: If the Premises are available Lessee may have nonexclusive possession of the Premises commencing ("Early Possession Date"). (See also Paragraphs 3.2 and 3.3)
1.5 Base Rent: $12,000.00 per month ("Base Rent"), payable on the 1st day of each month commencing March 1, 2023 . (See also Paragraph 4)
If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph 52 .
1.6 Lessee's Share of Common Area OperaƟng Expenses: percent ( %) ("Lessee's Share"). In the event that the size of the Premises and/or the Project are modified during the term of this Lease, Lessorshall recalculate Lessee's Share to reflect such modificaƟon.
1.7 Base Rent and Other Monies Paid Upon ExecuƟon:
(a) Base Rent: $12,000.00 for the period March 1, 2023 - March 31, 2023 . (b) Common Area OperaƟng Expenses: The current esƟmate for the period is . (c) Security Deposit: $12,000.00 ("Security Deposit"). (See also Paragraph 5) (d) Other: for .
(e) Total Due Upon ExecuƟon of this Lease: $24,000.00 .
1.8 Agreed Use: warehouse use for storing equipment for the City of Los Alamitos and the police department . (See also Paragraph 6)
1.9 Insuring Party. Lessor is the "Insuring Party". (See also Paragraph 8)
1.10 Real Estate Brokers. (See also Paragraphs 15 and 25) (a) RepresentaƟon: Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency RelaƟonship, confirms and consentsto the following agency relaƟonships in this Lease with the following real estate brokers ("Broker(s)") and/or their agents("Agent(s)"):
Lessor's Brokerage Firm Lee & Associates Commercial Real Estate Services, Inc. - South Bay dba Lee & Associates Los Angeles- Long Beach, Inc. License No. 01069854 is the broker of (check one): the Lessor; or both the Lessee and Lessor (dual agent).
Lessor's Agent Shaun McCullough License No. 01380928 is (check one): the Lessor's Agent (salesperson or broker associate); or both the Lessee's Agent and the Lessor's Agent (dual agent).
Lessee's Brokerage Firm Lee & Associates Commercial Real Estate Services, Inc., - South Bay dba Lee & Associates Los Angeles - Long Beach, Inc. License No. 01069854 Is the broker of (check one): the Lessee; or both the Lessee and Lessor (dual agent).
Lessee's Agent Shaun McCullough License No. 01380928 is (check one): the Lessee's Agent (salesperson or broker associate); or both the Lessee's Agent and the Lessor's Agent (dual agent). (b) Payment to Brokers. Upon execuƟon and delivery of this Lease by both ParƟes, Lessorshall pay to the Brokersthe brokerage fee agreed to in a separate wriƩen agreement (or if there is no such agreement, the sum of or of 4 % of the total Base Rent) for the brokerage services rendered by the Brokers.
1.11 Guarantor. The obligaƟons of the Lessee under this Lease are to be guaranteed by ("Guarantor"). (See also Paragraph 37)
1.12 AƩachments. AƩached hereto are the following, all of which consƟtute a part of this Lease:
an Addendum consisƟng of Paragraphs 50 through 53 ;
a site plan depicƟng the Premises;
a site plan depicƟng the Project;
a current set of the Rules and RegulaƟons for the Project; a current set of the Rules and RegulaƟons adopted by the owners' associaƟon;
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a Work LeƩer;
other (specify): .
2. Premises.
2.1 Leƫng. Lessor hereby leases to Lessee, and Lessee hereby leasesfrom Lessor, the Premises, for the term, at the rental, and upon all of the terms, covenants and condiƟons set forth in this Lease. While the approximate square footage of the Premises may have been used in the markeƟng of the Premisesfor purposes of comparison, the Base Rentstated herein is NOT Ɵed to square footage and is not subject to adjustment should the actual size be determined to be different. NOTE: Lessee is advised to verify the actual size prior to execuƟng this Lease.
2.2 CondiƟon. Lessor shall deliver that porƟon of the Premises contained within the Building ("Unit") to Lessee broom clean and free of debris on the Commencement Date or the Early Possession Date, whichever first occurs("Start Date"), and, so long as the required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days following the Start Date, warrants that the exisƟng electrical, plumbing, fire sprinkler, lighƟng, heaƟng, venƟlaƟng and air condiƟoning systems("HVAC"), loading doors,sump pumps, if any, and all othersuch elementsin the Unit, other than those constructed by Lessee, shall be in good operaƟng condiƟon on said date, that the structural elements of the roof, bearing walls and foundaƟon of the Unitshall be free of material defects, and that the Unit does not contain hazardous levels of any mold or fungi defined as toxic under applicable state or federal law. If a noncompliance with such warranty exists as of the Start Date, or if one of such systems or elementsshould malfuncƟon or fail within the appropriate warranty period, Lessorshall, as Lessor's sole obligaƟon with respect to such maƩer, except as otherwise provided in this Lease, promptly aŌer receipt of wriƩen noƟce from Lessee seƫng forth with specificity the nature and extent of such noncompliance, malfuncƟon or failure, recƟfy same at Lessor's expense. The warranty periods shall be asfollows: (i) 6 months as to the HVAC systems, and (ii) 30 days as to the remaining systems and other elements of the Unit. If Lessee does not give Lessor the required noƟce within the appropriate warranty period, correcƟon of any such noncompliance, malfuncƟon or failure shall be the obligaƟon of Lessee at Lessee'ssole cost and expense (except for the repairs to the fire sprinkler systems, roof, foundaƟons, and/or bearing walls see Paragraph 7). Lessor also warrants, that unless otherwise specified in wriƟng, Lessor is unaware of (i) any recorded NoƟces of Default affecƟng the Premise; (ii) any delinquent amounts due under any loan secured by the Premises; and (iii) any bankruptcy proceeding affecƟng the Premises.
2.3 Compliance. Lessor warrantsthat to the best of its knowledge the improvements on the Premises and the Common Areas comply with the building codes, applicable laws, covenants or restricƟons of record, regulaƟons, and ordinances ("Applicable Requirements") that were in effect at the Ɵme that each improvement, or porƟon thereof, was constructed. Said warranty does not apply to the use to which Lessee will put the Premises, modificaƟons which may be required by the Americans with DisabiliƟes Act or any similar laws as a result of Lessee's use (see Paragraph 49), or to any AlteraƟons or UƟlity InstallaƟons (as defined in Paragraph
7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible for determining whether or not the Applicable Requirements, and especially the zoning are appropriate for Lessee's intended use, and acknowledges that past uses of the Premises may no longer be allowed. If the Premises do not comply with said warranty, Lessor shall, except as otherwise provided, promptly aŌer receipt of wriƩen noƟce from Lessee seƫng forth with specificity the nature and extent of such noncompliance, recƟfy the same at Lessor's expense. If Lessee does not give Lessor wriƩen noƟce of a noncompliance with this warranty within 6 monthsfollowing the Start Date, correcƟon of that noncompliance shall be the obligaƟon of Lessee at Lessee'ssole cost and expense. If the Applicable Requirements are hereaŌer changed so asto require during the term of this Lease the construcƟon of an addiƟon to or an alteraƟon of the Unit, Premises and/or Building, the remediaƟon of any Hazardous Substance, or the reinforcement or other physical modificaƟon of the Unit, Premises and/or Building ("Capital Expenditure"), Lessor and Lessee shall allocate the cost of such work as follows:
(a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee as compared with uses by tenantsin general, Lessee shall be fully responsible for the cost thereof, provided, however, that if such Capital Expenditure is required during the last 2 years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee may instead terminate this Lease unless Lessor noƟfies Lessee, in wriƟng, within 10 days aŌer receipt of Lessee's terminaƟon noƟce that Lessor has elected to pay the difference between the actual cost thereof and the amount equal to 6 months' Base Rent. If Lessee elects terminaƟon, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure and deliver to Lessor wriƩen noƟce specifying a terminaƟon date at least 90 daysthereaŌer. Such terminaƟon date shall, however, in no event be earlier than the last day that Lessee could legally uƟlize the Premises without commencing such Capital Expenditure. (b) If such Capital Expenditure is not the result of the specific and unique use of the Premises by Lessee (such as, governmentally mandated seismic modificaƟons), then Lessorshall pay forsuch Capital Expenditure and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease or any extension thereof, on the date that on which the Base Rent is due, an amount equal to 1/144th of the porƟon of such costs reasonably aƩributable to the Premises. Lessee shall pay Interest on the balance but may prepay its obligaƟon at any Ɵme. If, however,such Capital Expenditure is required during the last 2 years of this Lease or if Lessor reasonably determines that it is not economically feasible to pay itsshare thereof, Lessorshall have the opƟon to terminate this Lease upon 90 days prior wriƩen noƟce to Lessee unless Lessee noƟfies Lessor, in wriƟng, within 10 days aŌer receipt of Lessor'sterminaƟon noƟce that Lessee will pay forsuch Capital Expenditure. If Lessor does not elect to terminate, and failsto tender itsshare of any such Capital Expenditure, Lessee may advance such funds and deduct same, with Interest, from Rent unƟl Lessor's share of such costs have been fully paid. If Lessee is unable to finance Lessor'sshare, or if the balance of the Rent due and payable for the remainder of this Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the right to terminate this Lease upon 30 days wriƩen noƟce to Lessor.
(c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to nonvoluntary, unexpected, and new Applicable Requirements. If the Capital Expenditures are instead triggered by Lessee as a result of an actual or proposed change in use, change in intensity of use, or modificaƟon to the Premises then, and in that event, Lessee shall either: (i) immediately cease such changed use or intensity of use and/or take such other steps as may be necessary to eliminate the requirement forsuch Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lessee shall not have any right to terminate this Lease.
2.4 Acknowledgements. Lessee acknowledges that: (a) it has been given an opportunity to inspect and measure the Premises; (b) it has been advised by Lessor and/or Brokersto saƟsfy itself with respect to the size and condiƟon of the Premises (including but not limited to the electrical, HVAC and fire sprinkler systems, security, environmental aspects, and compliance with Applicable Requirements and the Americans with DisabiliƟes Act), and theirsuitability for Lessee's intended use; (c) Lessee has made such invesƟgaƟon as it deems necessary with reference to such maƩers and assumes all responsibility therefor asthe same relate to its occupancy of the Premises; (d) it is not relying on any representaƟon asto the size of the Premises made by Brokers or Lessor; (e) the square footage of the Premises was not material to Lessee's decision to lease the Premises and pay the Rentstated herein; and (f) neither Lessor, Lessor's agents, nor Brokers have made any oral or wriƩen representaƟons or warranƟes with respect to said maƩers other than asset forth in this Lease. In addiƟon, Lessor acknowledges that: (i) Brokers have made no representaƟons, promises or warranƟes concerning Lessee's ability to honor the Lease orsuitability to occupy the Premises, and (ii) it is Lessor'ssole responsibility to invesƟgate the financial capability and/or suitability of all proposed tenants.
2.5 Lessee as Prior Owner/Occupant. The warranƟes made by Lessor in Paragraph 2 shall be of no force or effect if immediately prior to the Start Date Lessee wasthe owner or occupant of the Premises. In such event, Lessee shall be responsible for any necessary correcƟve work.
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2.6 Vehicle Parking. Lessee shall be enƟtled to use the number of Parking Spacesspecified in Paragraph 1.2(b) on those porƟons of the Common Areas designated from Ɵme to Ɵme by Lessor for parking. Lessee shall not use more parking spacesthan said number. Said parking spaces shall be used for parking by vehicles no larger than fullsize passenger automobiles or pickup trucks, herein called "PermiƩed Size Vehicles." Lessor may regulate the loading and unloading of vehicles by adopƟng Rules and RegulaƟons as provided in Paragraph 2.9. No vehicles other than PermiƩed Size Vehicles may be parked in the Common Area without the prior wriƩen permission of Lessor. In addiƟon:
(a) Lessee shall not permit or allow any vehicles that belong to or are controlled by Lessee or Lessee's employees,suppliers, shippers, customers, contractors or inviteesto be loaded, unloaded, or parked in areas other than those designated by Lessor forsuch acƟviƟes. (b) Lessee shall not service orstore any vehiclesin the Common Areas. (c) If Lessee permits or allows any of the prohibited acƟviƟes described in this Paragraph 2.6, then Lessorshall have the right, without noƟce, in addiƟon to such other rights and remediesthat it may have, to remove or tow away the vehicle involved and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor.
2.7 Common Areas DefiniƟon. The term "Common Areas"is defined as all areas and faciliƟes outside the Premises and within the exterior boundary line of the Project and interior uƟlity raceways and installaƟons within the Unit that are provided and designated by the Lessor from Ɵme to Ɵme for the general nonexclusive use of Lessor, Lessee and other tenants of the Project and their respecƟve employees, suppliers, shippers, customers, contractors and invitees, including parking areas, loading and unloading areas, trash areas, roofs, roadways, walkways, driveways and landscaped areas.
2.8 Common Areas Lessee's Rights. Lessor grants to Lessee, for the benefit of Lessee and its employees, suppliers, shippers, contractors, customers and invitees, during the term of this Lease, the nonexclusive right to use, in common with others enƟtled to such use, the Common Areas as they exist from Ɵme to Ɵme, subject to any rights, powers, and privileges reserved by Lessor under the terms hereof or under the terms of any rules and regulaƟons or restricƟons governing the use of the Project. Under no circumstances shall the right herein granted to use the Common Areas be deemed to include the right to store any property, temporarily or permanently, in the Common Areas. Any such storage shall be permiƩed only by the prior wriƩen consent of Lessor or Lessor's designated agent, which consent may be revoked at any Ɵme. In the event that any unauthorized storage shall occur, then Lessorshall have the right, without noƟce, in addiƟon to such other rights and remedies that it may have, to remove the property and charge the cost to Lessee, which costshall be immediately payable upon demand by Lessor.
2.9 Common Areas Rules and RegulaƟons. Lessor orsuch other person(s) as Lessor may appointshall have the exclusive control and management of the Common Areas and shall have the right, from Ɵme to Ɵme, to establish, modify, amend and enforce reasonable rules and regulaƟons ("Rules and RegulaƟons") for the management, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservaƟon of good order, as well as for the convenience of other occupants or tenants of the Building and the Project and their invitees. Lessee agreesto abide by and conform to all such Rules and RegulaƟons, and shall use its best efforts to cause its employees,suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessor shall not be responsible to Lessee for the noncompliance with said Rules and RegulaƟons by other tenants of the Project.
2.10 Common Areas Changes. Lessor shall have the right, in Lessor'ssole discreƟon, from Ɵme to Ɵme:
(a) To make changes to the Common Areas, including, without limitaƟon, changes in the locaƟon,size, shape and number of driveways, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direcƟon of traffic, landscaped areas, walkways and uƟlity raceways; (b) To close temporarily any of the Common Areasfor maintenance purposes so long as reasonable access to the Premises remains available; (c) To designate other land outside the boundaries of the Project to be a part of the Common Areas; (d) To add addiƟonal buildings and improvementsto the Common Areas; (e) To use the Common Areas while engaged in making addiƟonal improvements, repairs or alteraƟonsto the Project, or any porƟon thereof; and (f) To do and perform such other acts and make such other changes in, to or with respect to the Common Areas and Project as Lessor may, in the exercise of sound business judgment, deem to be appropriate.
3. Term.
3.1 Term. The Commencement Date, ExpiraƟon Date and Original Term of this Lease are as specified in Paragraph 1.3.
3.2 Early Possession. Any provision herein granƟng Lessee Early Possession of the Premisesis subject to and condiƟoned upon the Premises being available forsuch possession prior to the Commencement Date. Any grant of Early Possession only conveys anonexclusive right to occupy the Premises. If Lessee totally or parƟally occupies the Premises prior to the Commencement Date, the obligaƟon to pay Base Rentshall be abated for the period of such Early Possession. All other terms of this Lease (including but not limited to the obligaƟons to pay Lessee's Share of Common Area OperaƟng Expenses, Real Property Taxes and insurance premiums and to maintain the Premises) shall be in effect during such period. Any such Early Possession shall not affect the ExpiraƟon Date.
3.3 Delay In Possession. Lessor agreesto use commercially reasonable effortsto deliver exclusive possession of the Premises to Lessee by the Commencement Date. If, despite said efforts, Lessor is unable to deliver possession by such date, Lessorshall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease or change the ExpiraƟon Date. Lessee shall not, however, be obligated to pay Rent or perform its other obligaƟons unƟl Lessor delivers possession of the Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and conƟnue for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of Lessee. If possession is not delivered within 60 days aŌer the Commencement Date, asthe same may be extended under the terms of any Work LeƩer executed by ParƟes, Lessee may, at its opƟon, by noƟce in wriƟng within 10 days aŌer the end of such 60 day period, cancel this Lease, in which event the ParƟesshall be discharged from all obligaƟons hereunder. If such wriƩen noƟce is not received by Lessor within said 10 day period, Lessee's right to cancel shall terminate. If possession of the Premises is not delivered within 120 days aŌer the Commencement Date, this Lease shall terminate unless other agreements are reached between Lessor and Lessee, in wriƟng.
3.4 Lessee Compliance. Lessorshall not be required to tender possession of the Premisesto Lessee unƟl Lessee complies with its obligaƟon to provide evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to perform all of its obligaƟons under this Lease from and aŌer the Start Date, including the payment of Rent, notwithstanding Lessor's elecƟon to withhold possession pending receipt of such evidence of insurance. Further, if Lessee isrequired to perform any other condiƟons prior to or concurrent with the Start Date, the Start Date shall occur but Lessor may elect to withhold possession unƟl such condiƟons are saƟsfied.
4. Rent.
4.1 Rent Defined. All monetary obligaƟons of Lessee to Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent ("Rent").
4.2 Common Area OperaƟng Expenses. Lessee shall pay to Lessor during the term hereof, in addiƟon to the Base Rent, Lessee's Share (as specified in Paragraph 1.6) of all Common Area OperaƟng Expenses, as hereinaŌer defined, during each calendar year of the term of this Lease, in accordance with the following provisions:
(a) The following costs relaƟng to the ownership and operaƟon of the Project are defined as "Common Area OperaƟng Expenses":
(i) CostsrelaƟng to the operaƟon, repair and maintenance, in neat, clean, good order and condiƟon, but not the replacement (see subparagraph
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(e)), of the following:
(aa) The Common Areas and Common Area improvements, including parking areas, loading and unloading areas, trash areas, roadways, parkways, walkways, driveways, landscaped areas, bumpers, irrigaƟon systems, Common Area lighƟng faciliƟes, fences and gates, elevators, roofs, exterior walls of the buildings, building systems and roof drainage systems.
(bb) Exterior signs and any tenant directories.
(cc) Any fire sprinkler systems.
(dd) All other areas and improvementsthat are within the exterior boundaries of the Project but outside of the Premises and/or any other space occupied by a tenant.
(ii) The cost of water, gas, electricity and telephone to service the Common Areas and any uƟliƟes not separately metered. (iii) The cost of trash disposal, pest control services, property management,security services, owners' associaƟon dues and fees, the cost to repaint the exterior of any structures and the cost of any environmental inspecƟons. (iv) Reserves set aside for maintenance and repair of Common Areas and Common Area equipment. (v) Any increase above the Base Real Property Taxes (as defined in Paragraph 10). (vi) Any "Insurance Cost Increase" (as defined in Paragraph 8). (vii) Any deducƟble porƟon of an insured loss concerning the Building or the Common Areas. (viii) Auditors', accountants' and aƩorneys' fees and costsrelated to the operaƟon, maintenance, repair and replacement of the Project. (ix) The cost of any capital improvement to the Building or the Project not covered under the provisions of Paragraph 2.3 provided; however, that Lessorshall allocate the cost of any such capital improvement over a12 year period and Lessee shall not be required to pay more than Lessee's Share of 1/144th of the cost of such capital improvement in any given month. Lessee shall pay Interest on the unamorƟzed balance but may prepay its obligaƟon at any Ɵme. (x) The cost of any other servicesto be provided by Lessor that are stated elsewhere in this Lease to be a Common Area OperaƟng Expense. (b) Any Common Area OperaƟng Expenses and Real Property Taxes that are specifically aƩributable to the Unit, the Building or to any other building in the Project or to the operaƟon, repair and maintenance thereof, shall be allocated enƟrely to such Unit, Building, or other building. However, any Common Area OperaƟng Expenses and Real Property Taxesthat are not specifically aƩributable to the Building or to any other building or to the operaƟon, repair and maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Project. (c) The inclusion of the improvements, faciliƟes and servicesset forth in Subparagraph 4.2(a) shall not be deemed to impose an obligaƟon upon Lessor to either have said improvements or faciliƟes or to provide those services unlessthe Project already has the same, Lessor already provides the services, or Lessor has agreed elsewhere in this Lease to provide the same orsome of them. (d) Lessee's Share of Common Area OperaƟng Expenses is payable monthly on the same day asthe Base Rent is due hereunder. The amount of such paymentsshall be based on Lessor's esƟmate of the annual Common Area OperaƟng Expenses. Within 60 days aŌer wriƩen request (but not more than once each year) Lessor shall deliver to Lessee a reasonably detailed statementshowing Lessee's Share of the actual Common Area OperaƟng Expensesfor the preceding year. If Lessee's payments during such year exceed Lessee's Share, Lessor shall credit the amount of such overpayment against Lessee'sfuture payments. If Lessee's payments during such year were lessthan Lessee's Share, Lessee shall pay to Lessor the amount of the deficiency within 10 days aŌer delivery by Lessor to Lessee of the statement.
(e) Common Area OperaƟng Expenses shall not include the cost of replacing equipment or capital componentssuch asthe roof, foundaƟons, exterior walls or Common Area capital improvements, such asthe parking lot paving, elevators, fences that have a useful life for accounƟng purposes of 5 years or more. (f) Common Area OperaƟng Expenses shall not include any expenses paid by any tenant directly to third parƟes, or as to which Lessor is otherwise reimbursed by any third party, other tenant, or insurance proceeds.
4.3 Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset or deducƟon (except as specifically permiƩed in this Lease), on or before the day on which it is due. All monetary amounts shall be rounded to the nearest whole dollar. In the event that any statement or invoice prepared by Lessor is inaccurate such inaccuracy shall not consƟtute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease. Rent for any period during the term hereof which isfor less than one full calendar month shall be prorated based upon the actual number of days of said month. Payment of Rentshall be made to Lessor at its address stated herein or to such other personsor place as Lessor may from Ɵme to Ɵme designate in wriƟng.
Acceptance of a payment which isless than the amount then due shall not be a waiver of Lessor's rightsto the balance of such Rent, regardless of Lessor's endorsement of any check so staƟng. In the event that any check, draŌ, or other instrument of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in addiƟon to any Late Charge and Lessor, at its opƟon, may require all future Rent be paid by cashier's check. Payments will be applied first to accrued late charges and aƩorney's fees, second to accrued interest, then to Base Rent and Common Area OperaƟng Expenses, and any remaining amount to any other outstanding charges or costs.
5. Security Deposit. Lessee shall deposit with Lessor upon execuƟon hereof the Security Deposit as security for Lessee's faithful performance of its obligaƟons under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use, apply or retain all or any porƟon of said Security Deposit for the payment of any amount already due Lessor, for Rents which will be due in the future, and/ or to reimburse or compensate Lessor for any liability, expense, loss or damage which Lessor may suffer or incur by reason thereof. If Lessor uses or applies all or any porƟon of the Security Deposit, Lessee shall within 10 days aŌer wriƩen request therefor deposit monies with Lessor sufficient to restore said Security Deposit to the full amount required by this Lease. If the Base Rent increases during the term of this Lease, Lessee shall, upon wriƩen request from Lessor, deposit addiƟonal monies with Lessorso that the total amount of the Security Deposit shall at all Ɵmes bear the same proporƟon to the increased Base Rent as the iniƟal Security Deposit bore to the iniƟal Base Rent. Should the Agreed Use be amended to accommodate a material change in the business of Lessee or to accommodate a sublessee or assignee, Lessorshall have the right to increase the Security Deposit to the extent necessary, in Lessor'sreasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof. If a change in control of Lessee occurs during this Lease and following such change the financial condiƟon of Lessee is, in Lessor's reasonable judgment, significantly reduced, Lessee shall deposit such addiƟonal monies with Lessor asshall be sufficient to cause the Security Deposit to be at a commercially reasonable level based on such change in financial condiƟon. Lessor shall not be required to keep the Security Deposit separate from its general accounts. Within 90 days aŌer the expiraƟon or terminaƟon of this Lease, Lessorshall return that porƟon of the Security Deposit not used or applied by Lessor. Lessor shall upon wriƩen request provide Lessee with an accounƟng showing how that porƟon of the Security Deposit that was not returned was applied. No part of the Security Deposit shall be considered to be held in trust, to bear interest or to be prepayment for any moniesto be paid by Lessee under this Lease. THE SECURITY DEPOSIT SHALL NOT BE USED BY LESSEE IN LIEU OF PAYMENT OF THE LAST MONTH'S RENT.
6. Use.
6.1 Use. Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which isreasonably comparable thereto, and for no other purpose. Lessee shall not use or permit the use of the Premisesin a manner that is unlawful, creates damage, waste or a nuisance, or that disturbs occupants of or
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causes damage to neighboring premises or properƟes. Other than guide, signal and seeing eye dogs, Lessee shall not keep or allow in the Premises any pets, animals, birds, fish, or repƟles. Lessorshall not unreasonably withhold or delay its consent to any wriƩen request for a modificaƟon of the Agreed Use,so long as the same will not impair the structural integrity of the Building or the mechanical or electrical systems therein, and/or is notsignificantly more burdensome to the Project. If Lessor electsto withhold consent, Lessorshall within 7 days aŌersuch request give wriƩen noƟficaƟon of same, which noƟce shall include an explanaƟon of Lessor's objecƟonsto the change in the Agreed Use.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance"as used in this Lease shall mean any product, substance, or waste whose presence, use, manufacture, disposal, transportaƟon, or release, either by itself or in combinaƟon with other materials expected to be on the Premises, is either: (i) potenƟally injurious to the public health,safety or welfare, the environment or the Premises; (ii) regulated or monitored by any governmental authority, or (iii) a basis for potenƟal liability of Lessor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substances shall include, but not be limited to, hydrocarbons, petroleum, gasoline, and/or crude oil or any products, byproducts or fracƟons thereof. Lessee shall not engage in any acƟvity in or on the Premises which consƟtutes a Reportable Use of Hazardous Substances without the express prior wriƩen consent of Lessor and Ɵmely compliance (at Lessee's expense) with all Applicable Requirements. "Reportable Use" shall mean (i) the installaƟon or use of any above or below ground storage tank; (ii) the generaƟon, possession, storage, use, transportaƟon, or disposal of a Hazardous Substance that requires a permit from, or with respect to which a report, noƟce, registraƟon or business plan isrequired to be filed with, any governmental authority, and/or (iii) the presence at the Premises of a Hazardous Substance with respect to which any Applicable Requirements requires that a noƟce be given to persons entering or occupying the Premises or neighboring properƟes. Notwithstanding the foregoing, Lessee may use any ordinary and customary materialsreasonably required to be used in the normal course of the Agreed Use, ordinary office supplies (copier toner, liquid paper, glue, etc.) and common household cleaning materials, so long assuch use isin compliance with all Applicable Requirements, is not a Reportable Use, and does not expose the Premises or neighboring property to any meaningful risk of contaminaƟon or damage or expose Lessor to any liability therefor. In addiƟon, Lessor may condiƟon its consent to any Reportable Use upon receiving such addiƟonal assurances as Lessor reasonably deems necessary to protect itself, the public, the Premises and/or the environment against damage, contaminaƟon, injury and/or liability, including, but not limited to, the installaƟon (and removal on or before Lease expiraƟon or terminaƟon) of protecƟve modificaƟons (such as concrete encasements) and/or increasing the Security Deposit. (b) Duty to Inform Lessor. If Lessee knows, or hasreasonable cause to believe, that a Hazardous Substance has come to be located in, on, under or about the Premises, other than as previously consented to by Lessor, Lessee shall immediately give wriƩen noƟce of such fact to Lessor, and provide Lessor with a copy of any report, noƟce, claim or other documentaƟon which it has concerning the presence of such Hazardous Substance. (c) Lessee RemediaƟon. Lessee shall not cause or permit any Hazardous Substance to be spilled or released in, on, under, or about the Premises (including through the plumbing orsanitary sewer system) and shall promptly, at Lessee's expense, comply with all Applicable Requirements and take all invesƟgatory and/or remedial acƟon reasonably recommended, whether or not formally ordered or required, for the cleanup of any contaminaƟon of, and for the maintenance, security and/or monitoring of the Premises or neighboring properƟes, that was caused or materially contributed to by Lessee, or pertaining to or involving any Hazardous Substance brought onto the Premises during the term of this Lease, by or for Lessee, or any third party. (d) Lessee IndemnificaƟon. Lessee shall indemnify, defend and hold Lessor, its agents, employees, lenders and ground lessor, if any, harmlessfrom and against any and all loss of rents and/or damages, liabiliƟes, judgments, claims, expenses, penalƟes, and aƩorneys' and consultants' fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Lessee, Lessee’s employees, contractors or invitees , or any third party (provided, however, that Lessee shall have no liability under this Lease with respect to underground migraƟon of any Hazardous Substance under the Premisesfrom areas outside of the Project not caused or contributed to by Lessee). Lessee's obligaƟons shall include, but not be limited to, the effects of any contaminaƟon or injury to person, property or the environment created orsuffered by Lessee, and the cost of invesƟgaƟon, removal, remediaƟon, restoraƟon and/or abatement, and shall survive the expiraƟon or terminaƟon of this Lease. No terminaƟon, cancellaƟon or release agreement entered into by Lessor and Lessee shall release Lessee from its obligaƟons under this Lease with respect to Hazardous Substances, unless specifically so agreed by Lessor in wriƟng at the Ɵme of such agreement. (e) Lessor IndemnificaƟon. Except as otherwise provided in paragraph 8.7, Lessor and its successors and assigns shall indemnify, defend, reimburse and hold Lessee, its employees and lenders, harmless from and against any and all environmental damages, including the cost of remediaƟon, which are suffered as a direct result of Hazardous Substances on the Premises prior to Lessee taking possession or which are caused by the gross negligence or willful misconduct of Lessor, its agents or employees. Lessor's obligaƟons, as and when required by the Applicable Requirements, shall include, but not be limited to, the cost of invesƟgaƟon, removal, remediaƟon, restoraƟon and/or abatement, and shall survive the expiraƟon or terminaƟon of this Lease. (f) InvesƟgaƟons and RemediaƟons. Lessorshall retain the responsibility and pay for any invesƟgaƟons or remediaƟon measuresrequired by governmental enƟƟes having jurisdicƟon with respect to the existence of Hazardous Substances on the Premises prior to the Lessee taking possession, unlesssuch remediaƟon measure isrequired as a result of Lessee's use (including "AlteraƟons", as defined in paragraph 7.3(a) below) of the Premises, in which event Lessee shall be responsible forsuch payment. Lessee shall cooperate fully in any such acƟviƟes at the request of Lessor, including allowing Lessor and Lessor's agentsto have reasonable access to the Premises at reasonable Ɵmesin order to carry out Lessor's invesƟgaƟve and remedial responsibiliƟes. (g) Lessor TerminaƟon OpƟon. If a Hazardous Substance CondiƟon (see Paragraph 9.1(e)) occurs during the term of this Lease, unless Lessee is legally responsible therefor (in which case Lessee shall make the invesƟgaƟon and remediaƟon thereof required by the Applicable Requirements and this Lease shall conƟnue in full force and effect, but subject to Lessor's rights under Paragraph 6.2(d) and Paragraph 13), Lessor may, at Lessor's opƟon, either (i) invesƟgate and remediate such Hazardous Substance CondiƟon, if required, assoon asreasonably possible at Lessor's expense, in which event this Lease shall conƟnue in full force and effect, or (ii) if the esƟmated cost to remediate such condiƟon exceeds 12 Ɵmesthe then monthly Base Rent or $100,000, whichever is greater, give wriƩen noƟce to Lessee, within 30 days aŌer receipt by Lessor of knowledge of the occurrence of such Hazardous Substance CondiƟon, of Lessor's desire to terminate this Lease as of the date 60 daysfollowing the date of such noƟce. In the event Lessor electsto give a terminaƟon noƟce, Lessee may, within 10 daysthereaŌer, give wriƩen noƟce to Lessor of Lessee's commitment to pay the amount by which the cost of the remediaƟon of such Hazardous Substance CondiƟon exceeds an amount equal to 12 Ɵmesthe then monthly Base Rent or $100,000, whichever is greater. Lessee shall provide Lessor with said funds orsaƟsfactory assurance thereof within 30 days following such commitment. In such event, this Lease shall conƟnue in full force and effect, and Lessor shall proceed to make such remediaƟon assoon asreasonably possible aŌer the required funds are available. If Lessee does not give such noƟce and provide the required fundsor assurance thereof within the Ɵme provided, this Lease shall terminate as of the date specified in Lessor's noƟce of terminaƟon.
6.3 Lessee's Compliance with Applicable Requirements. Except as otherwise provided in this Lease, Lessee shall, at Lessee'ssole expense, fully, diligently and in a Ɵmely manner, materially comply with all Applicable Requirements, the requirements of any applicable fire insurance underwriter or raƟng bureau, and the recommendaƟons of Lessor's engineers and/or consultants which relate in any manner to the Premises, without regard to whether said Applicable Requirements are now in effect or become effecƟve aŌer the Start Date. Lessee shall, within 10 days aŌer receipt of Lessor's wriƩen request, provide Lessor with copies of all permits and other documents, and other informaƟon evidencing Lessee's compliance with any Applicable Requirementsspecified by Lessor, and shall immediately upon receipt, noƟfy Lessor in wriƟng (with copies of any documentsinvolved) of any threatened or actual claim, noƟce, citaƟon, warning, complaint or report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements. Likewise, Lessee shall immediately give wriƩen noƟce to Lessor of: (i)
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any water damage to the Premises and any suspected seepage, pooling, dampness or other condiƟon conducive to the producƟon of mold; or (ii) any musƟness or other odors that might indicate the presence of mold in the Premises.
6.4 InspecƟon; Compliance. Lessor and Lessor's "Lender" (as defined in Paragraph 30) and consultants authorized by Lessorshall have the right to enter into Premises at any Ɵme in the case of an emergency, and otherwise at reasonable Ɵmes aŌer reasonable noƟce, for the purpose of inspecƟng and/or tesƟng the condiƟon of the Premises and/or for verifying compliance by Lessee with this Lease. The cost of any such inspecƟons shall be paid by Lessor, unless a violaƟon of Applicable Requirements, or a Hazardous Substance CondiƟon (see Paragraph 9.1(e)) is found to exist or be imminent, or the inspecƟon is requested or ordered by a governmental authority. In such case, Lessee shall upon request reimburse Lessor for the cost of such inspecƟon, so long as such inspecƟon is reasonably related to the violaƟon or contaminaƟon. In addiƟon, Lessee shall provide copies of all relevant material safety data sheets(MSDS)to Lessor within 10 days of the receipt of wriƩen request therefor. Lessee acknowledges that any failure on its part to allow such inspecƟonsor tesƟng will expose Lessor to risks and potenƟally cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to allow such inspecƟons and/or tesƟng in a Ɵmely fashion the Base Rent shall be automaƟcally increased, without any requirement for noƟce to Lessee, by an amount equal to 10% of the then exisƟng Base Rent or $100, whichever is greater for the remainder to the Lease. The ParƟes agree that such increase in Base Rent represents fair and reasonable compensaƟon for the addiƟonal risk/coststhat Lessor will incur by reason of Lessee'sfailure to allow such inspecƟon and/or tesƟng. Such increase in Base Rent shall in no event consƟtute a waiver of Lessee's Default or Breach with respect to such failure nor prevent the exercise of any of the other rights and remedies granted hereunder.
7. Maintenance; Repairs; UƟlity InstallaƟons; Trade Fixtures and AlteraƟons.
7.1 Lessee's ObligaƟons.
(a) In General. Subject to the provisions of Paragraph 2.2 (CondiƟon), 2.3 (Compliance), 6.3 (Lessee's Compliance with Applicable Requirements), 7.2 (Lessor's ObligaƟons), 9 (Damage or DestrucƟon), and 14 (CondemnaƟon), Lessee shall, at Lessee'ssole expense, keep the Premises, UƟlity InstallaƟons (intended for Lessee's exclusive use, no maƩer where located), and AlteraƟons in good order, condiƟon and repair (whether or not the porƟon of the Premisesrequiring repairs, or the means of repairing the same, are reasonably or readily accessible to Lessee, and whether or not the need forsuch repairs occurs as a result of Lessee's use, any prior use, the elements or the age of such porƟon of the Premises), including, but not limited to, all equipment or faciliƟes,such as plumbing, HVAC equipment, electrical, lighƟng faciliƟes, boilers, pressure vessels, fixtures, interior walls, interiorsurfaces of exterior walls, ceilings, floors, windows, doors, plate glass, and skylights but excluding any items which are the responsibility of Lessor pursuant to Paragraph 7.2. Lessee, in keeping the Premises in good order, condiƟon and repair, shall exercise and perform good maintenance pracƟces, specifically including the procurement and maintenance of the service contractsrequired by Paragraph 7.1(b) below. Lessee's obligaƟons shall include restoraƟons, replacements or renewals when necessary to keep the Premises and all improvements thereon or a part thereof in good order, condiƟon and state of repair.
(b) Service Contracts. Lessee shall, at Lessee's sole expense, procure and maintain contracts, with copies to Lessor, in customary form and substance for, and with contractorsspecializing and experienced in the maintenance of the following equipment and improvements, if any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler and pressure vessels, and (iii) clarifiers. However, Lessor reserves the right, upon noƟce to Lessee, to procure and maintain any or all of such service contracts, and Lessee shall reimburse Lessor, upon demand, for the cost thereof. (c) Failure to Perform. If Lessee fails to perform Lessee's obligaƟons under this Paragraph 7.1, Lessor may enter upon the Premises aŌer 10 days' prior wriƩen noƟce to Lessee (except in the case of an emergency, in which case no noƟce shall be required), perform such obligaƟons on Lessee's behalf, and put the Premisesin good order, condiƟon and repair, and Lessee shall promptly pay to Lessor a sum equal to 115% of the cost thereof. (d) Replacement. Subject to Lessee'sindemnificaƟon of Lessor as set forth in Paragraph 8.7 below, and without relieving Lessee of liability resulƟng from Lessee'sfailure to exercise and perform good maintenance pracƟces, if an item described in Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess of 50% of the cost of replacing such item, then such item shall be replaced by Lessor, and the cost thereof shall be prorated between the ParƟes and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease or any extension thereof, on the date on which Base Rent is due, an amount equal to the product of mulƟplying the cost of such replacement by a fracƟon, the numerator of which is one, and the denominator of which is 144 (i.e. 1/144th of the cost per month). Lessee shall pay Interest on the unamorƟzed balance but may prepay its obligaƟon at any Ɵme.
7.2 Lessor's ObligaƟons. Subject to the provisions of Paragraphs 2.2 (CondiƟon), 2.3 (Compliance), 4.2 (Common Area OperaƟng Expenses), 6 (Use), 7.1 (Lessee's ObligaƟons), 9 (Damage or DestrucƟon) and 14 (CondemnaƟon), Lessor,subject to reimbursement pursuant to Paragraph 4.2, shall keep in good order, condiƟon and repair the foundaƟons, exterior walls, structural condiƟon of interior bearing walls, exterior roof, fire sprinklersystem, Common Area fire alarm and/or smoke detecƟon systems, fire hydrants, parking lots, walkways, parkways, driveways, landscaping, fences,signs and uƟlity systems serving the Common Areas and all partsthereof, as well as providing the servicesfor which there is a Common Area OperaƟng Expense pursuant to Paragraph 4.2. Lessor shall not be obligated to paint the exterior or interior surfaces of exterior walls nor shall Lessor be obligated to maintain, repair or replace windows, doors or plate glass of the Premises.
7.3 UƟlity InstallaƟons; Trade Fixtures; AlteraƟons.
(a) DefiniƟons. The term "UƟlity InstallaƟons" refersto all floor and window coverings, air and/or vacuum lines, power panels, electrical distribuƟon, security and fire protecƟon systems, communicaƟon cabling, lighƟng fixtures, HVAC equipment, plumbing, and fencing in or on the Premises. The term "Trade Fixtures" shall mean Lessee's machinery and equipment that can be removed without doing material damage to the Premises. The term "AlteraƟons" shall mean any modificaƟon of the improvements, other than UƟlity InstallaƟons or Trade Fixtures, whether by addiƟon or deleƟon. "Lessee Owned AlteraƟons and/or UƟlity InstallaƟons" are defined as AlteraƟons and/or UƟlity InstallaƟons made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a). (b) Consent. Lessee shall not make any AlteraƟons or UƟlity InstallaƟonsto the Premises without Lessor's prior wriƩen consent. Lessee may, however, make nonstructural AlteraƟons or UƟlity InstallaƟons to the interior of the Premises(excluding the roof) without such consent but upon noƟce to Lessor, as long as they are not visible from the outside, do not involve puncturing, relocaƟng or removing the roof or any exisƟng walls, will not affect the electrical, plumbing, HVAC, and/or life safety systems, do not trigger the requirement for addiƟonal modificaƟons and/or improvements to the PremisesresulƟng from Applicable Requirements, such as compliance with Title 24, and the cumulaƟve cost thereof during this Lease as extended does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum equal to one month's Base Rent in any one year. Notwithstanding the foregoing, Lessee shall not make or permit any roof penetraƟons and/or install anything on the roof without the prior wriƩen approval of Lessor. Lessor may, as a precondiƟon to granƟng such approval, require Lessee to uƟlize a contractor chosen and/or approved by Lessor. Any AlteraƟons or UƟlity InstallaƟons that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in wriƩen form with detailed plans. Consent shall be deemed condiƟoned upon Lessee's: (i) acquiring all applicable governmental permits, (ii) furnishing Lessor with copies of both the permits and the plans and specificaƟons prior to commencement of the work, and (iii) compliance with all condiƟons of said permits and other Applicable Requirements in a prompt and expediƟous manner. Any AlteraƟons or UƟlity InstallaƟons shall be performed in a workmanlike manner with good and sufficient materials. Lessee shall promptly upon compleƟon furnish Lessor with asbuilt plans and specificaƟons. For work which costs an amount in excess of one month's Base Rent, Lessor may condiƟon its consent upon Lessee providing a lien and compleƟon bond in an amount equal to 150% of the esƟmated cost of such AlteraƟon or UƟlity InstallaƟon and/or upon Lessee's posƟng an addiƟonal Security Deposit with Lessor. (c) Liens; Bonds. Lessee shall pay, when due, all claimsfor labor or materials furnished or alleged to have been furnished to or for Lessee at or for use on
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the Premises, which claims are or may be secured by any mechanic's or materialmen's lien against the Premises or any interest therein. Lessee shall give Lessor not lessthan 10 days noƟce prior to the commencement of any work in, on or about the Premises, and Lessorshall have the right to post noƟces of nonresponsibility. If Lessee shall contest the validity of any such lien, claim or demand, then Lessee shall, at itssole expense defend and protect itself, Lessor and the Premises against the same and shall pay and saƟsfy any such adverse judgment that may be rendered thereon before the enforcement thereof. If Lessorshall require, Lessee shall furnish a surety bond in an amount equal to 150% of the amount of such contested lien, claim or demand, indemnifying Lessor against liability for the same. If Lessor elects to parƟcipate in any such acƟon, Lessee shall pay Lessor's aƩorneys' fees and costs.
7.4 Ownership; Removal; Surrender; and RestoraƟon.
(a) Ownership. Subject to Lessor'sright to require removal or elect ownership as hereinaŌer provided, all AlteraƟons and UƟlity InstallaƟons made by Lessee shall be the property of Lessee, but considered a part of the Premises. Lessor may, at any Ɵme, elect in wriƟng to be the owner of all or any specified part of the Lessee Owned AlteraƟons and UƟlity InstallaƟons. Unless otherwise instructed per paragraph 7.4(b) hereof, all Lessee Owned AlteraƟons and UƟlity InstallaƟons shall, at the expiraƟon or terminaƟon of this Lease, become the property of Lessor and be surrendered by Lessee with the Premises. (b) Removal. By delivery to Lessee of wriƩen noƟce from Lessor not earlier than 90 and not later than 30 days prior to the end of the term of this Lease, Lessor may require that any or all Lessee Owned AlteraƟons or UƟlity InstallaƟons be removed by the expiraƟon or terminaƟon of this Lease. Lessor may require the removal at any Ɵme of all or any part of any Lessee Owned AlteraƟons or UƟlity InstallaƟons made without the required consent. (c) Surrender; RestoraƟon. Lessee shall surrender the Premises by the ExpiraƟon Date or any earlier terminaƟon date, with all of the improvements, parts and surfacesthereof broom clean and free of debris, and in good operaƟng order, condiƟon and state of repair, ordinary wear and tear excepted. "Ordinary wear and tear" shall not include any damage or deterioraƟon that would have been prevented by good maintenance pracƟce. Notwithstanding the foregoing and the provisions of Paragraph 7.1(a), if the Lessee occupies the Premisesfor 12 months or less, then Lessee shall surrender the Premises in the same condiƟon as delivered to Lessee on the Start Date with NO allowance for ordinary wear and tear. Lessee shall repair any damage occasioned by the installaƟon, maintenance or removal of Trade Fixtures, Lessee owned AlteraƟons and/or UƟlity InstallaƟons, furnishings, and equipment as well as the removal of any storage tank installed by or for Lessee.
Lessee shall also remove from the Premises any and all Hazardous Substances brought onto the Premises by or for Lessee, or any third party (except Hazardous Substances which were deposited via underground migraƟon from areas outside of the Premises) to the level specified in Applicable Requirements. Trade Fixtures shall remain the property of Lessee and shall be removed by Lessee. Any personal property of Lessee not removed on or before the ExpiraƟon Date or any earlier terminaƟon date shall be deemed to have been abandoned by Lessee and may be disposed of or retained by Lessor as Lessor may desire. The failure by Lessee to Ɵmely vacate the Premises pursuant to this Paragraph 7.4(c) without the express wriƩen consent of Lessor shall consƟtute a holdover under the provisions of Paragraph 26 below.
8. Insurance; Indemnity.
8.1 Payment of Premium Increases.
(a) As used herein, the term "Insurance Cost Increase"is defined as any increase in the actual cost of the insurance applicable to the Building and/or the Project and required to be carried by Lessor, pursuant to Paragraphs 8.2(b), 8.3(a) and 8.3(b), over and above the Base Premium, as hereinaŌer defined, calculated on an annual basis. Insurance Cost Increase shall include, but not be limited to, requirements of the holder of a mortgage or deed of trust covering the Premises, Building and/or Project, increased valuaƟon of the Premises, Building and/or Project, and/or a general premium rate increase. The term Insurance Cost Increase shall not, however, include any premium increases resulƟng from the nature of the occupancy of any other tenant of the Building. The "Base Premium" shall be the annual premium applicable to the 12 month period immediately preceding the Start Date. If, however, the Project was not insured for the enƟrety of such 12 month period, then the Base Premium shall be the lowest annual premium reasonably obtainable for the Required Insurance as of the Start Date, assuming the most nominal use possible of the Building.In no event, however, shall Lessee be responsible for any porƟon of the premium cost aƩributable to liability insurance coverage in excess of $2,000,000 procured under Paragraph 8.2(b).
(b) Lessee shall pay any Insurance Cost Increase to Lessor pursuant to Paragraph 4.2. Premiums for policy periods commencing prior to, or extending beyond, the term of this Lease shall be prorated to coincide with the corresponding Start Date or ExpiraƟon Date.
8.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force a Commercial General Liability policy of insurance protecƟng Lessee and Lessor as an addiƟonal insured against claims for bodily injury, personal injury and property damage based upon or arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not lessthan $1,000,000 per occurrence with an annual aggregate of not less than $2,000,000. Lessee shall add Lessor as an addiƟonal insured by means of an endorsement at least as broad asthe Insurance Service OrganizaƟon's "AddiƟonal InsuredManagers or Lessors of Premises" Endorsement. The policy shall not contain any intrainsured exclusions as between insured persons or organizaƟons, but shall include coverage for liability assumed under this Lease as an "insured contract" for the performance of Lessee's indemnity obligaƟons under this Lease. The limits of said insurance shall not, however, limit the liability of Lessee nor relieve Lessee of any obligaƟon hereunder.
Lessee shall provide an endorsement on its liability policy(ies) which provides that itsinsurance shall be primary to and not contributory with any similar insurance carried by Lessor, whose insurance shall be considered excess insurance only. For any of Lessee's owned, non-owned, and hired vehicles that are on or stored on the premises, automobile insurance with a limit for bodily injury and property damage of not less than $1,000,000 each occurrence is required.
(b) Carried by Lessor. Lessorshall maintain liability insurance as described in Paragraph 8.2(a), in addiƟon to, and not in lieu of, the insurance required to be maintained by Lessee. Lessee shall not be named as an addiƟonal insured therein.
8.3 Property Insurance Building, Improvements and Rental Value. (a) Building and Improvements. Lessorshall obtain and keep in force a policy or policies of insurance in the name of Lessor, with loss payable to Lessor, any groundlessor, and to any Lender insuring loss or damage to the Premises. The amount of such insurance shall be equal to the full insurable replacement cost of the Premises, asthe same shall exist from Ɵme to Ɵme, or the amount required by any Lender, butin no event more than the commercially reasonable and available insurable value thereof. Lessee Owned AlteraƟons and UƟlity InstallaƟons, Trade Fixtures, and Lessee's personal property shall be insured by Lessee not by Lessor. If the coverage is available and commercially appropriate, such policy or policies shall insure against all risks of direct physical loss or damage (except the perils of flood and/or earthquake unlessrequired by a Lender), including coverage for debris removal and the enforcement of any Applicable Requirements requiring the upgrading, demoliƟon, reconstrucƟon or replacement of any porƟon of the Premises as the result of a covered loss. Said policy or policiesshall also contain an agreed valuaƟon provision in lieu of any coinsurance clause, waiver of subrogaƟon, and inflaƟon guard protecƟon causing an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where the Premises are located. If such insurance coverage has a deducƟble clause, the deducƟble amount shall not exceed $5,000 per occurrence. (b) Rental Value. Lessor shall also obtain and keep in force a policy or policiesin the name of Lessor with loss payable to Lessor and any Lender, insuring the loss of the full Rent for one year with an extended period of indemnity for an addiƟonal 180 days("Rental Value insurance"). Said insurance shall contain an
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agreed valuaƟon provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted annually to reflect the projected Rent otherwise payable by Lessee, for the next 12 month period.
(c) Adjacent Premises. Lessee shall pay for any increase in the premiums for the property insurance of the Building and for the Common Areas or other buildings in the Project if said increase is caused by Lessee's acts, omissions, use or occupancy of the Premises. (d) Lessee's Improvements. Since Lessor isthe Insuring Party, Lessorshall not be required to insure Lessee Owned AlteraƟons and UƟlity InstallaƟons unless the item in quesƟon has become the property of Lessor under the terms of this Lease.
8.4 Lessee's Property; Business InterrupƟon Insurance; Worker's CompensaƟon Insurance. (a) Property Damage. Lessee shall obtain and maintain insurance coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned AlteraƟons and UƟlity InstallaƟons. Such insurance shall be full replacement cost coverage with a deducƟble of not to exceed $1,000 per occurrence. The proceeds from any such insurance shall be used by Lessee for the replacement of personal property, Trade Fixtures and Lessee Owned AlteraƟons and UƟlity InstallaƟons. (b) Business InterrupƟon. Lessee shall obtain and maintain loss of income and extra expense insurance in amounts as will reimburse Lessee for direct or indirect loss of earnings aƩributable to all perils commonly insured against by prudent lessees in the business of Lessee or aƩributable to prevenƟon of accessto the Premises as a result of such perils.
(c) Worker's CompensaƟon Insurance. Lessee shall obtain and maintain Worker's CompensaƟon Insurance in such amount as may be required by Applicable Requirements. Such policy shall include a 'Waiver of SubrogaƟon' endorsement. Lessee shall provide Lessor with a copy of such endorsement along with the cerƟficate of insurance or copy of the policy required by paragraph 8.5. (d) No RepresentaƟon of Adequate Coverage. Lessor makes no representaƟon that the limits or forms of coverage of insurance specified herein are adequate to cover Lessee's property, business operaƟons or obligaƟons under this Lease.
8.5 Insurance Policies. Insurance required herein shall be by companies maintaining during the policy term a "General Policyholders RaƟng" of at least A, VII, asset forth in the most current issue of "Best'sInsurance Guide", orsuch other raƟng as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidatesthe required insurance policies. Lessee shall, prior to the Start Date, deliver to Lessor cerƟfied copies of policies of such insurance or cerƟficates with copies of the required endorsements evidencing the existence and amounts of the required insurance. No such policy shall be cancelable or subject to modificaƟon except aŌer 30 days prior wriƩen noƟce to Lessor. Lessee shall, at least 10 days prior to the expiraƟon of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof, or Lessor may increase hisliability insurance coverage and charge the cost thereof to Lessee, which amountshall be payable by Lessee to Lessor upon demand. Such policiesshall be for a term of at least one year, or the length of the remaining term of this Lease, whichever is less. If either Party shall fail to procure and maintain the insurance required to be carried by it, the other Party may, but shall not be required to, procure and maintain the same.
8.6 Waiver of SubrogaƟon. Without affecƟng any other rights or remedies, Lessee and Lessor each hereby release and relieve the other, and waive their enƟre right to recover damages against the other, for loss of or damage to its property arising out of or incident to the perilsrequired to be insured against herein. The effect of such releases and waivers is not limited by the amount of insurance carried or required, or by any deducƟbles applicable hereto. The ParƟes agree to have their respecƟve property damage insurance carriers waive any right to subrogaƟon thatsuch companies may have against Lessor or Lessee, as the case may be,so long as the insurance is not invalidated thereby.
8.7 Indemnity. Except for Lessor's gross negligence or willful misconduct, Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its agents, Lessor's master or ground lessor, partners and Lenders, from and against any and all claims, loss of rents and/or damages, liens, judgments, penalƟes, aƩorneys' and consultants' fees, expenses and/or liabiliƟes arising out of, involving, or in connecƟon with, a Breach of the Lease by Lessee and/or the use and/or occupancy of the Premises and/or Project by Lessee and/or by Lessee's employees, contractors or invitees. If any acƟon or proceeding is brought against Lessor by reason of any of the foregoing maƩers, Lessee shall upon noƟce defend the same at Lessee's expense by counsel reasonably saƟsfactory to Lessor and Lessorshall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in order to be defended or indemnified.
8.8 ExempƟon of Lessor and its Agents from Liability. Notwithstanding the negligence or breach of this Lease by Lessor or its agents, neither Lessor nor its agentsshall be liable under any circumstances for: (i) injury or damage to the person or goods, wares, merchandise or other property of Lessee, Lessee's employees, contractors, invitees, customers, or any other person in or about the Premises, whether such damage or injury is caused by or resultsfrom fire, steam, electricity, gas, water or rain, indoor air quality, the presence of mold or from the breakage, leakage, obstrucƟon or other defects of pipes, fire sprinklers, wires, appliances, plumbing, HVAC or lighƟng fixtures, or from any other cause, whether the said injury or damage results from condiƟons arising upon the Premises or upon other porƟons of the Building, or from other sources or places; (ii) any damages arising from any act or neglect of any other tenant of Lessor or from the failure of Lessor or its agentsto enforce the provisions of any other lease in the Project; or (iii) injury to Lessee's business or for any loss of income or profit therefrom. Instead, it isintended that Lessee'ssole recourse in the event of such damages or injury be to file a claim on the insurance policy(ies) that Lessee isrequired to maintain pursuant to the provisions of paragraph 8.
8.9 Failure to Provide Insurance. Lessee acknowledges that any failure on its part to obtain or maintain the insurance required herein will expose Lessor to risks and potenƟally cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, for any month or porƟon thereof that Lessee does not maintain the required insurance and/or does not provide Lessor with the required binders or cerƟficates evidencing the existence of the required insurance, the Base Rentshall be automaƟcally increased, without any requirement for noƟce to Lessee, by an amount equal to 10% of the then exisƟng Base Rent or $100, whichever is greater. The parƟes agree that such increase in Base Rent represents fair and reasonable compensaƟon for the addiƟonal risk/costs that Lessor will incur by reason of Lessee'sfailure to maintain the required insurance. Such increase in Base Rentshall in no event consƟtute a waiver of Lessee's Default or Breach with respect to the failure to maintain such insurance, prevent the exercise of any of the other rights and remedies granted hereunder, nor relieve Lessee of its obligaƟon to maintain the insurance specified in this Lease.
9. Damage or DestrucƟon.
9.1 DefiniƟons.
(a) "Premises ParƟal Damage" shall mean damage or destrucƟon to the improvements on the Premises, other than Lessee Owned AlteraƟons and UƟlity InstallaƟons, which can reasonably be repaired in 3 months or less from the date of the damage or destrucƟon, and the cost thereof does not exceed a sum equal to 6 month's Base Rent. Lessorshall noƟfy Lessee in wriƟng within 30 daysfrom the date of the damage or destrucƟon asto whether or not the damage is ParƟal or Total. (b) "Premises Total DestrucƟon" shall mean damage or destrucƟon to the improvements on the Premises, other than Lessee Owned AlteraƟons and UƟlity InstallaƟons and Trade Fixtures, which cannot reasonably be repaired in 3 months or lessfrom the date of the damage or destrucƟon and/or the cost thereof exceeds a sum equal to 6 month's Base Rent. Lessor shall noƟfy Lessee in wriƟng within 30 days from the date of the damage or destrucƟon as to whether or not the damage is ParƟal or Total.
(c) "Insured Loss" shall mean damage or destrucƟon to improvements on the Premises, other than Lessee Owned AlteraƟons and UƟlity InstallaƟons and Trade Fixtures, which was caused by an event required to be covered by the insurance described in Paragraph 8.3(a), irrespecƟve of any deducƟble amounts or coverage limits involved.
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(d) "Replacement Cost" shall mean the cost to repair or rebuild the improvements owned by Lessor at the Ɵme of the occurrence to their condiƟon exisƟng immediately prior thereto, including demoliƟon, debris removal and upgrading required by the operaƟon of Applicable Requirements, and without deducƟon for depreciaƟon.
(e) "Hazardous Substance CondiƟon" shall mean the occurrence or discovery of a condiƟon involving the presence of, or a contaminaƟon by, a Hazardous Substance, in, on, or under the Premises which requires restoraƟon.
9.2 ParƟal Damage Insured Loss. If a Premises ParƟal Damage that is an Insured Loss occurs, then Lessorshall, at Lessor's expense, repair such damage (but not Lessee's Trade Fixtures or Lessee Owned AlteraƟons and UƟlity InstallaƟons) assoon as reasonably possible and this Lease shall conƟnue in full force and effect; provided, however, that Lessee shall, at Lessor's elecƟon, make the repair of any damage or destrucƟon the total cost to repair of which is $10,000 or less, and, in such event, Lessor shall make any applicable insurance proceeds available to Lessee on a reasonable basis for that purpose. Notwithstanding the foregoing, if the required insurance was not in force or the insurance proceeds are not sufficient to effect such repair, the Insuring Party shall promptly contribute the shortage in proceeds as and when required to complete said repairs. In the event, however,such shortage was due to the fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not commercially reasonable and available, Lessor shall haveno obligaƟon to pay for the shortage in insurance proceeds or to fully restore the unique aspects of the Premises unless Lessee provides Lessor with the funds to cover same, or adequate assurance thereof, within 10 days following receipt of wriƩen noƟce of such shortage and request therefor. If Lessor receivessaid funds or adequate assurance thereof within said 10 day period, the party responsible for making the repairsshall complete them assoon asreasonably possible and this Lease shall remain in full force and effect. If such funds or assurance are not received, Lessor may nevertheless elect by wriƩen noƟce to Lessee within 10 days thereaŌer to: (i) make such restoraƟon and repair as is commercially reasonable with Lessor paying any shortage in proceeds, in which case this Lease shall remain in full force and effect, or (ii) have this Lease terminate 30 daysthereaŌer. Lessee shall not be enƟtled to reimbursement of any funds contributed by Lessee to repair any such damage or destrucƟon. Premises ParƟal Damage due to flood or earthquake shall be subject to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but the net proceeds of any such insurance shall be made available for the repairs if made by either Party.
9.3 ParƟal Damage Uninsured Loss. If a Premises ParƟal Damage that is not an Insured Loss occurs, unless caused by a negligent or willful act of Lessee (in which event Lessee shall make the repairs at Lessee's expense), Lessor may either: (i) repair such damage as soon as reasonably possible at Lessor's expense (subject to reimbursement pursuant to Paragraph 4.2), in which event this Lease shall conƟnue in full force and effect, or (ii) terminate this Lease by giving wriƩen noƟce to Lessee within 30 days aŌer receipt by Lessor of knowledge of the occurrence of such damage. Such terminaƟon shall be effecƟve 60 days following the date of such noƟce. In the event Lessor elects to terminate this Lease, Lessee shall have the right within 10 days aŌer receipt of the terminaƟon noƟce to give wriƩen noƟce to Lessor of Lessee's commitment to pay for the repair of such damage without reimbursement from Lessor. Lessee shall provide Lessor with said funds orsaƟsfactory assurance thereof within 30 days aŌer making such commitment. In such event this Lease shall conƟnue in full force and effect, and Lessor shall proceed to make such repairs assoon asreasonably possible aŌer the required funds are available. If Lessee does not make the required commitment, this Lease shall terminate as of the date specified in the terminaƟon noƟce.
9.4 Total DestrucƟon. Notwithstanding any other provision hereof, if a Premises Total DestrucƟon occurs, this Lease shall terminate 60 days following such DestrucƟon. If the damage or destrucƟon was caused by the gross negligence or willful misconduct of Lessee, Lessor shall have the right to recover Lessor's damages from Lessee, except as provided in Paragraph 8.6.
9.5 Damage Near End of Term. If at any Ɵme during the last 6 months of this Lease there is damage for which the cost to repair exceeds one month's Base Rent, whether or not an Insured Loss, Lessor may terminate this Lease effecƟve 60 daysfollowing the date of occurrence of such damage by giving a wriƩen terminaƟon noƟce to Lessee within 30 days aŌer the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee at that Ɵme has an exercisable opƟon to extend this Lease or to purchase the Premises, then Lessee may preserve this Lease by (a) exercising such opƟon and (b) providing Lessor with any shortage in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is 10 days aŌer Lessee'sreceipt of Lessor's wriƩen noƟce purporƟng to terminate this Lease, or (ii) the day prior to the date upon which such opƟon expires. If Lessee duly exercises such opƟon during such period and provides Lessor with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor's commercially reasonable expense, repair such damage assoon asreasonably possible and this Lease shall conƟnue in full force and effect. If Lessee fails to exercise such opƟon and provide such funds or assurance during such period, then this Lease shall terminate on the date specified in the terminaƟon noƟce and Lessee's opƟon shall be exƟnguished.
9.6 Abatement of Rent; Lessee's Remedies.
(a) Abatement.In the event of Premises ParƟal Damage or Premises Total DestrucƟon or a Hazardous Substance CondiƟon for which Lessee is not responsible under this Lease, the Rent payable by Lessee for the period required for the repair, remediaƟon or restoraƟon of such damage shall be abated in proporƟon to the degree to which Lessee's use of the Premises isimpaired, but not to exceed the proceeds received from the Rental Value insurance. All other obligaƟons of Lessee hereunder shall be performed by Lessee, and Lessor shall have no liability for any such damage, destrucƟon, remediaƟon, repair or restoraƟon except as provided herein.
(b) Remedies. If Lessor is obligated to repair or restore the Premises and does not commence, in a substanƟal and meaningful way,such repair or restoraƟon within 90 days aŌer such obligaƟon shall accrue, Lessee may, at any Ɵme prior to the commencement of such repair or restoraƟon, give wriƩen noƟce to Lessor and to any Lenders of which Lessee has actual noƟce, of Lessee's elecƟon to terminate this Lease on a date not lessthan 60 days following the giving of such noƟce. If Lessee givessuch noƟce and such repair or restoraƟon is not commenced within 30 daysthereaŌer, this Lease shall terminate as of the date specified in said noƟce. If the repair or restoraƟon is commenced within such 30 days, this Lease shall conƟnue in full force and effect. "Commence" shall mean either the uncondiƟonal authorizaƟon of the preparaƟon of the required plans, or the beginning of the actual work on the Premises, whichever first occurs.
9.7 TerminaƟon; Advance Payments. Upon terminaƟon of this Lease pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be made concerning advance Base Rent and any other advance payments made by Lessee to Lessor. Lessor shall, in addiƟon, return to Lessee so much of Lessee's Security Deposit as has not been, or is not then required to be, used by Lessor.
10. Real Property Taxes.
10.1 DefiniƟons.
(a) "Real Property Taxes." As used herein, the term "Real Property Taxes" shall include any form of assessment; real estate, general,special, ordinary or extraordinary, or rental levy or tax (other than inheritance, personal income or estate taxes); improvement bond; and/or license fee imposed upon or levied against any legal or equitable interest of Lessor in the Project, Lessor's right to other income therefrom, and/or Lessor's business of leasing, by any authority having the direct or indirect power to tax and where the funds are generated with reference to the Project address. The term "Real Property Taxes" shall also include any tax, fee, levy, assessment or charge, or any increase therein: (i) imposed by reason of events occurring during the term of this Lease, including but not limited to, a change in the ownership of the Project; (ii) a change in the improvementsthereon; and/or (iii) levied or assessed on machinery or equipment provided by Lessor to Lessee pursuant to this Lease.
(b) "Base Real Property Taxes." As used herein, the term "Base Real Property Taxes" shall be the amount of Real Property Taxes, which are assessed
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against the Project, during the enƟre calendar year in which the Lease is executed.
10.2 Payment of Taxes. Except as otherwise provided in Paragraph 10.3, Lessorshall pay the Real Property Taxes applicable to the Project, and said payments shall be included in the calculaƟon of Common Area OperaƟng Expenses in accordance with the provisions of Paragraph 4.2.
10.3 AddiƟonal Improvements. Common Area OperaƟng Expenses shall not include Real Property Taxesspecified in the tax assessor'srecords and work sheets as being caused by addiƟonal improvements placed upon the Project by other tenants or by Lessor for the exclusive enjoyment of such other Tenants.
Notwithstanding Paragraph 10.2 hereof, Lessee shall, however, pay to Lessor at the Ɵme Common Area OperaƟng Expenses are payable under Paragraph 4.2, the enƟrety of any increase in Real Property Taxesif assessed solely by reason of AlteraƟons, Trade Fixtures or UƟlity InstallaƟons placed upon the Premises by Lessee or at Lessee's request or by reason of any alteraƟons or improvements to the Premises made by Lessorsubsequent to the execuƟon of this Lease by the ParƟes.
10.4 Joint Assessment. If the Building is not separately assessed, Real Property Taxes allocated to the Building shall be an equitable proporƟon of the Real Property Taxes for all of the land and improvements included within the tax parcel assessed,such proporƟon to be determined by Lessor from the respecƟve valuaƟons assigned in the assessor's work sheets orsuch other informaƟon as may be reasonably available. Lessor'sreasonable determinaƟon thereof, in good faith, shall be conclusive.
10.5 Personal Property Taxes. Lessee shall pay prior to delinquency all taxes assessed against and levied upon Lessee Owned AlteraƟons and UƟlity InstallaƟons, Trade Fixtures, furnishings, equipment and all personal property of Lessee contained in the Premises. When possible, Lessee shall cause its Lessee Owned AlteraƟons and UƟlity InstallaƟons, Trade Fixtures, furnishings, equipment and all other personal property to be assessed and billed separately from the real property of Lessor. If any of Lessee'ssaid property shall be assessed with Lessor'sreal property, Lessee shall pay Lessor the taxes aƩributable to Lessee's property within 10 days aŌer receipt of a wriƩen statement seƫng forth the taxes applicable to Lessee's property.
11. UƟliƟes and Services.
11.1 Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and other uƟliƟes and servicessupplied to the Premises, together with any taxesthereon. Notwithstanding the provisions of Paragraph 4.2, if at any Ɵme in Lessor'ssole judgment, Lessor determines that Lessee is using a disproporƟonate amount of water, electricity or other commonly metered uƟliƟes, or that Lessee is generaƟng such a large volume of trash as to require an increase in the size of the trash receptacle and/or an increase in the number of Ɵmes per month that it is empƟed, then Lessor may increase Lessee's Base Rent by an amount equal to such increased costs. There shall be no abatement of Rent and Lessorshall not be liable in any respect whatsoever for the inadequacy, stoppage, interrupƟon or disconƟnuance of any uƟlity orservice due to riot, strike, labor dispute, breakdown, accident, repair or other cause beyond Lessor'sreasonable control or in cooperaƟon with governmental request or direcƟons.
11.2 Within fiŌeen days of Lessor's wriƩen request, Lessee agrees to deliver to Lessorsuch informaƟon, documents and/or authorizaƟon as Lessor needs in order for Lessor to comply with new or exisƟng Applicable Requirements relaƟng to commercial building energy usage, raƟngs, and/or the reporƟng thereof.
12. Assignment and Subleƫng.
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by operaƟon of law assign, transfer, mortgage or encumber (collecƟvely, "assign or assignment") orsublet all or any part of Lessee'sinterest in this Lease or in the Premises without Lessor's prior wriƩen consent. (b) Unless Lessee is a corporaƟon and its stock is publicly traded on a naƟonal stock exchange, a change in the control of Lessee shall consƟtute an assignment requiring consent. The transfer, on a cumulaƟve basis, of 25% or more of the voƟng control of Lessee shall consƟtute a change in control for this purpose. (c) The involvement of Lessee or its assets in any transacƟon, or series of transacƟons (by way of merger,sale, acquisiƟon, financing, transfer, leveraged buyout or otherwise), whether or not a formal assignment or hypothecaƟon of this Lease or Lessee's assets occurs, which results or will result in a reducƟon of the Net Worth of Lessee by an amount greater than 25% of such Net Worth asit wasrepresented at the Ɵme of the execuƟon of this Lease or at the Ɵme of the most recent assignment to which Lessor has consented, or as it exists immediately prior to said transacƟon or transacƟons consƟtuƟng such reducƟon, whichever was or is greater, shall be considered an assignment of this Lease to which Lessor may withhold its consent. "Net Worth of Lessee" shall mean the net worth of Lessee (excluding any guarantors) established under generally accepted accounƟng principles. (d) An assignment orsubleƫng without consentshall, at Lessor's opƟon, be a Default curable aŌer noƟce per Paragraph 13.1(d), or a noncurable Breach without the necessity of any noƟce and grace period. If Lessor electsto treatsuch unapproved assignment or subleƫng as a noncurable Breach, Lessor may either:
(i) terminate this Lease, or (ii) upon 30 days wriƩen noƟce, increase the monthly Base Rent to 110% of the Base Rent then in effect. Further, in the event of such Breach and rental adjustment, (i) the purchase price of any opƟon to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the price previously in effect, and (ii) all fixed and nonfixed rental adjustments scheduled during the remainder of the Lease term shall be increased to 110% of the scheduled adjusted rent.
(e) Lessee's remedy for any breach of Paragraph 12.1 by Lessorshall be limited to compensatory damages and/or injuncƟve relief. (f) Lessor may reasonably withhold consent to a proposed assignment orsubleƫng if Lessee is in Default at the Ɵme consent is requested. (g) Notwithstanding the foregoing, allowing a de minimis porƟon of the Premises, ie. 20 square feet or less, to be used by a third party vendor in connecƟon with the installaƟon of a vending machine or pay phone shall not consƟtute a subleƫng.
12.2 Terms and CondiƟons Applicable to Assignment and Subleƫng. (a) Regardless of Lessor's consent, no assignment orsubleƫng shall : (i) be effecƟve without the express wriƩen assumpƟon by such assignee or sublessee of the obligaƟons of Lessee under this Lease, (ii) release Lessee of any obligaƟons hereunder, or (iii) alter the primary liability of Lessee for the payment of Rent or for the performance of any other obligaƟons to be performed by Lessee. (b) Lessor may accept Rent or performance of Lessee's obligaƟons from any person other than Lessee pending approval or disapproval of an assignment.
Neither a delay in the approval or disapproval of such assignment nor the acceptance of Rent or performance shall consƟtute a waiver or estoppel of Lessor's right to exercise its remediesfor Lessee's Default or Breach.
(c) Lessor's consent to any assignment orsubleƫng shall not consƟtute a consent to any subsequent assignment orsubleƫng. (d) In the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee, any Guarantors or anyone else responsible for the performance of Lessee's obligaƟons under this Lease, including any assignee or sublessee, without first exhausƟng Lessor's remedies against any other person or enƟty responsible therefor to Lessor, or any security held by Lessor. (e) Each request for consent to an assignment or subleƫng shall be in wriƟng, accompanied by informaƟon relevant to Lessor's determinaƟon as to the financial and operaƟonal responsibility and appropriateness of the proposed assignee or sublessee, including but not limited to the intended use and/or required modificaƟon of the Premises, if any, together with a fee of $500 as consideraƟon for Lessor's considering and processing said request. Lessee agrees to provide Lessor with such other or addiƟonal informaƟon and/or documentaƟon as may be reasonably requested. (See also Paragraph 36) (f) Any assignee of, or sublessee under, this Lease shall, by reason of accepƟng such assignment, entering into such sublease, or entering into possession of the Premises or any porƟon thereof, be deemed to have assumed and agreed to conform and comply with each and every term, covenant, condiƟon and obligaƟon
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herein to be observed or performed by Lessee during the term of said assignment orsublease, other than such obligaƟons as are contrary to or inconsistent with provisions of an assignment orsublease to which Lessor hasspecifically consented to in wriƟng. (g) Lessor's consent to any assignment orsubleƫng shall not transfer to the assignee orsublessee any OpƟon granted to the original Lessee by this Lease unless such transfer is specifically consented to by Lessor in wriƟng. (See Paragraph 39.2)
12.3 AddiƟonal Terms and CondiƟons Applicable to Subleƫng. The following terms and condiƟons shall apply to any subleƫng by Lessee of all or any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein:
(a) Lessee hereby assigns and transfersto Lessor all of Lessee's interest in all Rent payable on any sublease, and Lessor may collectsuch Rent and apply same toward Lessee's obligaƟons under this Lease; provided, however, that unƟl a Breach shall occur in the performance of Lessee's obligaƟons, Lessee may collect said Rent. In the event that the amount collected by Lessor exceeds Lessee's then outstanding obligaƟons any such excessshall be refunded to Lessee. Lessorshall not, by reason of the foregoing or any assignment of such sublease, nor by reason of the collecƟon of Rent, be deemed liable to the sublessee for any failure of Lessee to perform and comply with any of Lessee's obligaƟons to such sublessee. Lessee hereby irrevocably authorizes and directs any such sublessee, upon receipt of a wriƩen noƟce from Lessor staƟng that a Breach exists in the performance of Lessee's obligaƟons under this Lease, to pay to Lessor all Rent due and to become due under the sublease. Sublessee shall rely upon any such noƟce from Lessor and shall pay all Rentsto Lessor without any obligaƟon or right to inquire as to whether such Breach exists, notwithstanding any claim from Lessee to the contrary. (b) In the event of a Breach by Lessee, Lessor may, at its opƟon, require sublessee to aƩorn to Lessor, in which event Lessorshall undertake the obligaƟons of the sublessor under such sublease from the Ɵme of the exercise of said opƟon to the expiraƟon of such sublease; provided, however, Lessorshall not be liable for any prepaid rents orsecurity deposit paid by such sublessee to such sublessor or for any prior Defaults or Breaches of such sublessor. (c) Any maƩer requiring the consent of the sublessor under a sublease shall also require the consent of Lessor. (d) No sublessee shall further assign orsublet all or any part of the Premises without Lessor's prior wriƩen consent. (e) Lessor shall deliver a copy of any noƟce of Default or Breach by Lessee to the sublessee, who shall have the right to cure the Default of Lessee within the grace period, if any,specified in such noƟce. The sublessee shall have a right of reimbursement and offset from and against Lessee for any such Defaults cured by the sublessee.
13. Default; Breach; Remedies.
13.1 Default; Breach.A"Default"is defined as a failure by the Lessee to comply with or perform any of the terms, covenants, condiƟons or Rules and RegulaƟons under this Lease. A "Breach"is defined asthe occurrence of one or more of the following Defaults, and the failure of Lessee to cure such Default within any applicable grace period:
(a) The abandonment of the Premises; the vacaƟng of the Premises prior to the expiraƟon or terminaƟon of this Lease without providing a commercially reasonable level of security, or where the coverage of the property insurance described in Paragraph 8.3 isjeopardized as a result thereof, or without providing reasonable assurances to minimize potenƟal vandalism; or failure to deliver to Lessor exclusive possession of the enƟre Premisesin accordance herewith prior to the expiraƟon or terminaƟon of this Lease.
(b) The failure of Lessee to make any payment of Rent or any Security Deposit required to be made by Lessee hereunder, whether to Lessor or to a third party, when due, to provide reasonable evidence of insurance orsurety bond, or to fulfill any obligaƟon under this Lease which endangers or threatens life or property, where such failure conƟnues for a period of 3 business days following wriƩen noƟce to Lessee. THE ACCEPTANCE BY LESSOR OF A PARTIAL PAYMENT OF
RENT OR SECURITY DEPOSIT SHALL NOT CONSTITUTE A WAIVER OF ANY OF LESSOR'S RIGHTS, INCLUDING LESSOR'S RIGHT TO RECOVER POSSESSION OF THE PREMISES.
(c) The failure of Lessee to allow Lessor and/or its agents access to the Premises or the commission of waste, act or acts consƟtuƟng public or private nuisance, and/or an illegal acƟvity on the Premises by Lessee, where such acƟons conƟnue for a period of 3 business days following wriƩen noƟce to Lessee. In the event that Lessee commits waste, a nuisance or an illegal acƟvity a second Ɵme then, the Lessor may elect to treat such conduct as a noncurable Breach rather than a Default.
(d) The failure by Lessee to provide (i) reasonable wriƩen evidence of compliance with Applicable Requirements, (ii) the service contracts, (iii) the rescission of an unauthorized assignment orsubleƫng, (iv) an Estoppel CerƟficate or financial statements, (v) a requested subordinaƟon, (vi) evidence concerning any guaranty and/or Guarantor, (vii) any document requested under Paragraph 41, (viii) material safety data sheets(MSDS), or (ix) any other documentaƟon or informaƟon which Lessor may reasonably require of Lessee under the terms of this Lease, where any such failure conƟnues for a period of 10 days following wriƩen noƟce to Lessee.
(e) A Default by Lessee asto the terms, covenants, condiƟons or provisions of this Lease, or of the rules adopted under Paragraph 2.9 hereof, other than those described in subparagraphs 13.1(a), (b), (c) or (d), above, where such Default conƟnues for a period of 30 days aŌer wriƩen noƟce; provided, however, that if the nature of Lessee's Default issuch that more than 30 days are reasonably required for its cure, then itshall not be deemed to be a Breach if Lessee commences such cure within said 30 day period and thereaŌer diligently prosecutes such cure to compleƟon. (f) The occurrence of any of the following events: (i) the making of any general arrangement or assignment for the benefit of creditors; (ii) becoming a "debtor"as defined in 11 U.S.C. § 101 or any successor statute thereto (unless, in the case of a peƟƟon filed against Lessee, the same is dismissed within 60 days); (iii) the appointment of a trustee or receiver to take possession of substanƟally all of Lessee's assets located at the Premises or of Lessee'sinterest in this Lease, where possession is not restored to Lessee within 30 days; or (iv) the aƩachment, execuƟon or other judicial seizure of substanƟally all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where such seizure is not discharged within 30 days; provided, however, in the event that any provision of this subparagraph is contrary to any applicable law, such provision shall be of no force or effect, and not affect the validity of the remaining provisions. (g) The discovery that any financial statement of Lessee or of any Guarantor given to Lessor was materially false. (h) If the performance of Lessee's obligaƟons under this Lease is guaranteed: (i) the death of a Guarantor, (ii) the terminaƟon of a Guarantor's liability with respect to this Lease other than in accordance with the terms of such guaranty, (iii) a Guarantor's becoming insolvent or the subject of a bankruptcy filing, (iv) a Guarantor'srefusal to honor the guaranty, or (v) a Guarantor's breach of its guaranty obligaƟon on an anƟcipatory basis, and Lessee's failure, within 60 days following wriƩen noƟce of any such event, to provide wriƩen alternaƟve assurance orsecurity, which, when coupled with the then exisƟng resources of Lessee, equals or exceedsthe combined financial resources of Lessee and the Guarantorsthat existed at the Ɵme of execuƟon of this Lease.
13.2 Remedies. If Lessee failsto perform any of its affirmaƟve duƟes or obligaƟons, within 10 days aŌer wriƩen noƟce (or in case of an emergency, without noƟce), Lessor may, at its opƟon, perform such duty or obligaƟon on Lessee's behalf, including but not limited to the obtaining of reasonably required bonds, insurance policies, or governmental licenses, permits or approvals. Lessee shall pay to Lessor an amount equal to 115% of the costs and expenses incurred by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach, Lessor may, with or without further noƟce or demand, and without limiƟng Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach:
(a) Terminate Lessee'sright to possession of the Premises by any lawful means, in which case this Lease shall terminate and Lessee shall immediately surrender possession to Lessor. In such event Lessor shall be enƟtled to recover from Lessee: (i) the unpaid Rent which had been earned at the Ɵme of terminaƟon;
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(ii) the worth at the Ɵme of award of the amount by which the unpaid rent which would have been earned aŌer terminaƟon unƟl the Ɵme of award exceeds the amount of such rental lossthat the Lessee proves could have been reasonably avoided; (iii) the worth at the Ɵme of award of the amount by which the unpaid rent for the balance of the term aŌer the Ɵme of award exceeds the amount of such rental lossthat the Lessee proves could be reasonably avoided; and (iv) any other amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee'sfailure to perform its obligaƟons under this Lease or which in the ordinary course of things would be likely to result therefrom, including but not limited to the cost of recovering possession of the Premises, expenses of releƫng, including necessary renovaƟon and alteraƟon of the Premises, reasonable aƩorneys' fees, and that porƟon of any leasing commission paid by Lessor in connecƟon with this Lease applicable to the unexpired term of this Lease. The worth at the Ɵme of award of the amount referred to in provision (iii) of the immediately preceding sentence shall be computed by discounƟng such amount at the discount rate of the Federal Reserve Bank of the District within which the Premises are located at the Ɵme of award plus one percent. Efforts by Lessor to miƟgate damages caused by Lessee's Breach of this Lease shall not waive Lessor's right to recover any damagesto which Lessor is otherwise enƟtled. If terminaƟon of this Lease is obtained through the provisional remedy of unlawful detainer, Lessor shall have the right to recover in such proceeding any unpaid Rent and damages as are recoverable therein, or Lessor may reserve the right to recover all or any part thereof in a separate suit. If a noƟce and grace period required under Paragraph 13.1 was not previously given, a noƟce to pay rentor quit, or to perform or quit given to Lessee under the unlawful detainer statute shall also consƟtute the noƟce required by Paragraph 13.1. In such case, the applicable grace period required by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default within the greater of the two such grace periodsshall consƟtute both an unlawful detainer and a Breach of this Lease enƟtling Lessor to the remedies provided for in this Lease and/or by said statute. (b) ConƟnue the Lease and Lessee'sright to possession and recover the Rent asit becomes due, in which event Lessee may sublet or assign, subject only to reasonable limitaƟons. Acts of maintenance, effortsto relet, and/or the appointment of a receiver to protect the Lessor'sinterests, shall not consƟtute a terminaƟon of the Lessee's right to possession.
(c) Pursue any other remedy now or hereaŌer available under the laws or judicial decisions of the state wherein the Premises are located. The expiraƟon or terminaƟon of this Lease and/or the terminaƟon of Lessee'sright to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease asto maƩers occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises.
13.3 Inducement Recapture. Any agreement for free or abated rent or other charges, the cost of tenant improvementsfor Lessee paid for or performed by Lessor, or for the giving or paying by Lessor to or for Lessee of any cash or other bonus, inducement or consideraƟon for Lessee's entering into this Lease, all of which concessions are hereinaŌer referred to as "Inducement Provisions," shall be deemed condiƟoned upon Lessee's full and faithful performance of all of the terms, covenants and condiƟons of this Lease. Upon Breach of this Lease by Lessee, any such Inducement Provision shall automaƟcally be deemed deleted from this Lease and of no further force or effect, and any rent, other charge, bonus, inducement or consideraƟon theretofore abated, given or paid by Lessor under such an Inducement Provision shall be immediately due and payable by Lessee to Lessor, notwithstanding any subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent or the cure of the Breach which iniƟated the operaƟon of this paragraph shall not be deemed a waiver by Lessor of the provisions of this paragraph unless specifically so stated in wriƟng by Lessor at the Ɵme of such acceptance.
13.4 Late Charges. Lessee hereby acknowledges that late payment by Lessee of Rent will cause Lessor to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such costsinclude, but are not limited to, processing and accounƟng charges, and late charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor within 5 days aŌer such amountshall be due, then, without any requirement for noƟce to Lessee, Lessee shall immediately pay to Lessor a oneƟme late charge equal to 10% of each such overdue amount or $100, whichever is greater. The parƟes hereby agree that such late charge represents a fair and reasonable esƟmate of the costs Lessor will incur by reason of such late payment.
Acceptance of such late charge by Lessor shall in no event consƟtute a waiver of Lessee's Default or Breach with respect to such overdue amount, nor prevent the exercise of any of the other rights and remedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for 3 consecuƟve installments of Base Rent, then notwithstanding any provision of this Lease to the contrary, Base Rent shall, at Lessor's opƟon, become due and payable quarterly in advance.
13.5 Interest. Any monetary payment due Lessor hereunder, other than late charges, not received by Lessor, when due shall bear interest from the 31st day aŌer it was due. The interest ("Interest") charged shall be computed at the rate of 10% per annum but shall not exceed the maximum rate allowed by law. Interest is payable in addiƟon to the potenƟal late charge provided for in Paragraph 13.4.
13.6 Breach by Lessor.
(a) NoƟce of Breach. Lessorshall not be deemed in breach of this Lease unless Lessor fails within a reasonable Ɵme to perform an obligaƟon required to be performed by Lessor. For purposes of this Paragraph, a reasonable Ɵme shall in no event be less than 30 days aŌer receipt by Lessor, and any Lender whose name and address shall have been furnished to Lessee in wriƟng for such purpose, of wriƩen noƟce specifying wherein such obligaƟon of Lessor has not been performed; provided, however, that if the nature of Lessor's obligaƟon issuch that more than 30 days are reasonably required for its performance, then Lessor shall not be in breach if performance is commenced within such 30 day period and thereaŌer diligently pursued to compleƟon. (b) Performance by Lessee on Behalf of Lessor.In the event that neither Lessor nor Lender curessaid breach within 30 days aŌer receipt of said noƟce, or if having commenced said cure they do not diligently pursue it to compleƟon, then Lessee may elect to cure said breach at Lessee's expense and offset from Rent the actual and reasonable cost to perform such cure, provided however, thatsuch offset shall not exceed an amount equal to the greater of one month's Base Rent or the Security Deposit, reserving Lessee'sright to reimbursement from Lessor for any such expense in excess of such offset. Lessee shall document the cost of said cure and supply said documentaƟon to Lessor.
14. CondemnaƟon. If the Premises or any porƟon thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power (collecƟvely "CondemnaƟon"), this Lease shall terminate as to the part taken as of the date the condemning authority takes Ɵtle or possession, whichever first occurs.
If more than 10% of the floor area of the Unit, or more than 25% of the parking spaces istaken by CondemnaƟon, Lessee may, at Lessee's opƟon, to be exercised in wriƟng within 10 days aŌer Lessorshall have given Lessee wriƩen noƟce of such taking (or in the absence of such noƟce, within 10 days aŌer the condemning authority shall have taken possession) terminate this Lease as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in accordance with the foregoing, this Lease shall remain in full force and effect as to the porƟon of the Premisesremaining, except that the Base Rent shall be reduced in proporƟon to the reducƟon in uƟlity of the Premises caused by such CondemnaƟon. CondemnaƟon awards and/or payments shall be the property of Lessor, whether such award shall be made as compensaƟon for diminuƟon in value of the leasehold, the value of the part taken, or forseverance damages; provided, however, that Lessee shall be enƟtled to any compensaƟon paid by the condemnor for Lessee'srelocaƟon expenses, loss of business goodwill and/or Trade Fixtures, without regard to whether or not this Lease is terminated pursuant to the provisions of this Paragraph. All AlteraƟons and UƟlity InstallaƟons made to the Premises by Lessee, for purposes of CondemnaƟon only, shall be considered the property of the Lessee and Lessee shall be enƟtled to any and all compensaƟon which is payable therefor. In the event that this Lease is not terminated by reason of the CondemnaƟon, Lessorshall repair any damage to the Premises caused by such CondemnaƟon.
15. Brokerage Fees.
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15.1 AddiƟonal Commission.In addiƟon to the payments owed pursuant to Paragraph 1.10 above, Lessor agrees that: (a) if Lessee exercises any OpƟon, (b) if Lessee or anyone affiliated with Lessee acquires from Lessor any rights to the Premises or other premises owned by Lessor and located within the Project, (c) if Lessee remains in possession of the Premises, with the consent of Lessor, aŌer the expiraƟon of this Lease, or (d) if Base Rent isincreased, whether by agreement or operaƟon of an escalaƟon clause herein, then, Lessorshall pay Brokers a fee in accordance with the fee schedule of the Brokersin effect at the Ɵme the Lease was executed. The provisions of this paragraph are intended to supersede the provisions of any earlier agreement to the contrary.
15.2 AssumpƟon of ObligaƟons. Any buyer or transferee of Lessor'sinterest in this Lease shall be deemed to have assumed Lessor's obligaƟon hereunder.
Brokersshall be third party beneficiaries of the provisions of Paragraphs 1.10, 15, 22 and 31. If Lessor failsto pay to Brokers any amounts due as and for brokerage fees pertaining to this Lease when due, then such amountsshall accrue Interest. In addiƟon, if Lessor fails to pay any amountsto Lessee's Broker when due, Lessee's Broker may send wriƩen noƟce to Lessor and Lessee of such failure and if Lessor fails to pay such amounts within 10 days aŌer said noƟce, Lessee shall pay said moniesto its Broker and offsetsuch amounts against Rent. In addiƟon, Lessee's Brokershall be deemed to be a third party beneficiary of any commission agreement entered into by and/or between Lessor and Lessor's Broker for the limited purpose of collecƟng any brokerage fee owed.
15.3 RepresentaƟons and IndemniƟes of Broker RelaƟonships. Lessee and Lessor each represent and warrant to the other that it has had no dealings with any person, firm, broker, agent or finder (other than the Brokers and Agents, if any) in connecƟon with this Lease, and that no one other than said named Brokers and Agentsis enƟtled to any commission or finder's fee in connecƟon herewith. Lessee and Lessor do each hereby agree to indemnify, protect, defend and hold the other harmlessfrom and against liability for compensaƟon or charges which may be claimed by any such unnamed broker, finder or other similar party by reason of any dealings or acƟons of the indemnifying Party, including any costs, expenses, aƩorneys' feesreasonably incurred with respect thereto.
16. Estoppel CerƟficates.
(a) Each Party (as "Responding Party") shall within 10 days aŌer wriƩen noƟce from the other Party (the "RequesƟng Party") execute, acknowledge and deliver to the RequesƟng Party a statement in wriƟng in form similar to the then most current "Estoppel CerƟficate" form published by AIR CRE, plus such addiƟonal informaƟon, confirmaƟon and/orstatements as may be reasonably requested by the RequesƟng Party. (b) If the Responding Party shall fail to execute or deliver the Estoppel CerƟficate within such 10 day period, the RequesƟng Party may execute an Estoppel CerƟficate staƟng that: (i) the Lease isin full force and effect without modificaƟon except as may be represented by the RequesƟng Party, (ii) there are no uncured defaults in the RequesƟng Party's performance, and (iii) if Lessor isthe RequesƟng Party, not more than one month'srent has been paid in advance.
ProspecƟve purchasers and encumbrancers may rely upon the RequesƟng Party's Estoppel CerƟficate, and the Responding Party shall be estopped from denying the truth of the facts contained in said CerƟficate. In addiƟon, Lessee acknowledges that any failureon its part to provide such an Estoppel CerƟficate will expose Lessor to risks and potenƟally cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to execute and/or deliver a requested Estoppel CerƟficate in a Ɵmely fashion the monthly Base Rentshall be automaƟcally increased, without any requirement for noƟce to Lessee, by an amount equal to 10% of the then exisƟng Base Rent or $100, whichever is greater for remainder of the Lease. The ParƟes agree that such increase in Base Rent represents fair and reasonable compensaƟon for the addiƟonal risk/costs that Lessor will incur by reason of Lessee's failure to provide the Estoppel CerƟficate. Such increase in Base Rentshall in no event consƟtute a waiver of Lessee's Default or Breach with respect to the failure to provide the Estoppel CerƟficate nor prevent the exercise of any of the other rights and remedies granted hereunder. (c) If Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee and all Guarantorsshall within 10 days aŌer wriƩen noƟce from Lessor deliver to any potenƟal lender or purchaser designated by Lessorsuch financial statements as may be reasonably required by such lender or purchaser, including but not limited to Lessee's financial statementsfor the past 3 years. All such financial statementsshall be received by Lessor and such lender or purchaser in confidence and shall be used only for the purposes herein set forth.
17. DefiniƟon of Lessor. The term "Lessor"as used herein shall mean the owner or owners at the Ɵme in quesƟon of the fee Ɵtle to the Premises, or, if thisis a sublease, of the Lessee's interest in the prior lease. In the event of a transfer of Lessor's Ɵtle or interest in the Premises or this Lease, Lessor shall deliver to the transferee or assignee (in cash or by credit) any unused Security Deposit held by Lessor. Upon such transfer or assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor shall be relieved of all liability with respect to the obligaƟons and/or covenants under this Lease thereaŌer to be performed by the Lessor.
Subject to the foregoing, the obligaƟons and/or covenants in this Lease to be performed by the Lessorshall be binding only upon the Lessor as hereinabove defined.
18. Severability. The invalidity of any provision of this Lease, as determined by a court of competent jurisdicƟon, shall in no way affect the validity of any other provision hereof.
19. Days. Unless otherwise specifically indicated to the contrary, the word "days"as used in this Lease shall mean and refer to calendar days.
20. LimitaƟon on Liability. The obligaƟons of Lessor under this Lease shall not consƟtute personal obligaƟons of Lessor, or its partners, members, directors, officers orshareholders, and Lessee shall look to the Premises, and to no other assets of Lessor, for the saƟsfacƟon of any liability of Lessor with respect to this Lease, and shall not seek recourse against Lessor's partners, members, directors, officers or shareholders, or any of their personal assetsfor such saƟsfacƟon.
21. Time of Essence. Time is of the essence with respect to the performance of all obligaƟons to be performed or observed by the ParƟes under this Lease.
22. No Prior or Other Agreements; Broker Disclaimer. This Lease contains all agreements between the ParƟes with respect to any maƩer menƟoned herein, and no other prior or contemporaneous agreement or understanding shall be effecƟve. Lessor and Lessee each represents and warrantsto the Brokers that it has made, and isrelying solely upon, its own invesƟgaƟon asto the nature, quality, character and financial responsibility of the other Party to this Lease and asto the use, nature, quality and character of the Premises. Brokers have no responsibility with respect thereto or with respect to any default or breach hereof by either Party.
23. NoƟces.
23.1 NoƟce Requirements. All noƟcesrequired or permiƩed by this Lease or applicable law shall be in wriƟng and may be delivered in person (by hand or by courier) or may be sent by regular, cerƟfied or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or by facsimile transmission, or by email, and shall be deemed sufficiently given if served in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party'ssignature on this Lease shall be that Party's address for delivery or mailing of noƟces. Either Party may by wriƩen noƟce to the otherspecify a different address for noƟce, except that upon Lessee's taking possession of the Premises, the Premises shall consƟtute Lessee's address for noƟce. A copy of all noƟces to Lessor shall be concurrently transmiƩed to such party or parƟes at such addresses as Lessor may from Ɵme to Ɵme hereaŌer designate in wriƟng.
23.2 Date of NoƟce. Any noƟce sent by registered or cerƟfied mail, return receipt requested, shall be deemed given on the date of delivery shown on the receipt card, or if no delivery date isshown, the postmark thereon. If sent by regular mail the noƟce shall be deemed given 72 hours aŌer the same is addressed as required herein and mailed with postage prepaid. NoƟces delivered by United States Express Mail or overnight courier that guarantees next day delivery shall be deemed given 24 hours aŌer delivery of the same to the Postal Service or courier. NoƟces delivered by hand, or transmiƩed by facsimile transmission or by email
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shall be deemed delivered upon actual receipt. If noƟce is received on a Saturday, Sunday or legal holiday, itshall be deemed received on the next business day.
23.3 OpƟons. Notwithstanding the foregoing, in order to exercise any OpƟons (see paragraph 39), the NoƟce must be sent by CerƟfied Mail (return receipt requested), Express Mail (signature required), courier (signature required) or some other methodology that provides a receipt establishing the date the noƟce was received by the Lessor.
24. Waivers.
(a) No waiver by Lessor of the Default or Breach of any term, covenant or condiƟon hereof by Lessee, shall be deemed a waiver of any other term, covenant or condiƟon hereof, or of any subsequent Default or Breach by Lessee of the same or of any other term, covenant or condiƟon hereof. Lessor's consent to, or approval of, any actshall not be deemed to render unnecessary the obtaining of Lessor's consent to, or approval of, any subsequent or similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease requiring such consent. (b) The acceptance of Rent by Lessorshall not be a waiver of any Default or Breach by Lessee. Any payment by Lessee may be accepted by Lessor on account of monies or damages due Lessor, notwithstanding any qualifying statements or condiƟons made by Lessee in connecƟon therewith, which such statements and/or condiƟons shall be of no force or effect whatsoever unless specifically agreed to in wriƟng by Lessor at or before the Ɵme of deposit of such payment. (c) THE PARTIES AGREE THAT THE TERMS OF THIS LEASE SHALL GOVERN WITH REGARD TO ALL MATTERS RELATED THERETO AND HEREBY WAIVE THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE TO THE EXTENT THAT SUCH STATUTE IS INCONSISTENT WITH THIS LEASE.
25. Disclosures Regarding The Nature of a Real Estate Agency RelaƟonship. (a) When entering into a discussion with a real estate agent regarding a real estate transacƟon, a Lessor or Lessee should from the outset understand what type of agency relaƟonship or representaƟon it has with the agent or agents in the transacƟon. Lessor and Lessee acknowledge being advised by the Brokers in thistransacƟon, asfollows:
(i) Lessor's Agent. A Lessor's agent under a lisƟng agreement with the Lessor acts asthe agent for the Lessor only. A Lessor's agent or subagent hasthe following affirmaƟve obligaƟons: To the Lessor:A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Lessor. To the Lessee and the Lessor: (a) Diligent exercise of reasonable skills and care in performance of the agent's duƟes. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose all facts known to the agent materially affecƟng the value or desirability of the property that are not known to, or within the diligent aƩenƟon and observaƟon of, the ParƟes. An agent is not obligated to reveal to either Party any confidenƟal informaƟon obtained from the other Party which does not involve the affirmaƟve duƟes set forth above.
(ii) Lessee's Agent.An agent can agree to act as agent for the Lessee only. In these situaƟons, the agent is not the Lessor's agent, even if by agreement the agent may receive compensaƟon for servicesrendered, either in full or in part from the Lessor. An agent acƟng only for a Lessee hasthe following affirmaƟve obligaƟons. To the Lessee:A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Lessee. To the Lessee and the Lessor: (a) Diligent exercise of reasonable skills and care in performance of the agent's duƟes. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose all facts known to the agent materially affecƟng the value or desirability of the property that are not known to, or within the diligent aƩenƟon and observaƟon of, the ParƟes.
An agent is not obligated to reveal to either Party any confidenƟal informaƟon obtained from the other Party which does not involve the affirmaƟve duƟes set forth above.
(iii) Agent RepresenƟng Both Lessor and Lessee. A real estate agent, either acƟng directly or through one or more associate licensees, can legally be the agent of both the Lessor and the Lessee in a transacƟon, but only with the knowledge and consent of both the Lessor and the Lessee. In a dual agency situaƟon, the agent hasthe following affirmaƟve obligaƟons to both the Lessor and the Lessee: (a) A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either Lessor or the Lessee. (b) Other duƟes to the Lessor and the Lessee asstated above in subparagraphs (i) or (ii). In represenƟng both Lessor and Lessee, the agent may not, without the express permission of the respecƟve Party, disclose to the other Party confidenƟal informaƟon, including, but not limited to, facts relaƟng to either Lessee's or Lessor's financial posiƟon, moƟvaƟons, bargaining posiƟon, or other personal informaƟon that may impact rent, including Lessor's willingness to accept a rent less than the lisƟng rent or Lessee's willingness to pay rent greater than the rent offered. The above duƟes of the agent in a real estate transacƟon do not relieve a Lessor or Lessee from the responsibility to protect their own interests. Lessor and Lessee should carefully read all agreementsto assure that they adequately express their understanding of the transacƟon. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired, consult a competent professional. Both Lessor and Lessee should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transacƟon can be complex and subject to change. (b) Brokers have no responsibility with respect to any default or breach hereof by either Party. The ParƟes agree that no lawsuit or other legal proceeding involving any breach of duty, error or omission relaƟng to this Lease may be brought against Broker more than one year aŌer the Start Date and that the liability (including court costs and aƩorneys' fees), of any Broker with respect to any such lawsuit and/or legal proceeding shall not exceed the fee received by such Broker pursuant to this Lease; provided, however, that the foregoing limitaƟon on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker.
(c) Lessor and Lessee agree to idenƟfy to Brokers as "ConfidenƟal" any communicaƟon or informaƟon given Brokers that is considered by such Party to be confidenƟal.
26. No Right To Holdover. Lessee has no right to retain possession of the Premises or any part thereof beyond the expiraƟon or terminaƟon of this Lease. At or prior to the expiraƟon or terminaƟon of this Lease Lessee shall deliver exclusive possession of the Premisesto Lessor. For purposes of this provision and Paragraph
13.1(a), exclusive possession shall mean that Lessee shall have vacated the Premises, removed all of its personal property therefrom and that the Premises have been returned in the condiƟon specified in this Lease. In the event that Lessee does not deliver exclusive possession to Lessor asspecified above, then Lessor's damages during any holdover period shall be computed at the amount of the Rent (as defined in Paragraph 4.1) due during the last full month before the expiraƟon or terminaƟon of this Lease (disregarding any temporary abatement of Rent that may have been in effect), but with Base Rent being 150% of the Base Rent payable during such last full month. Nothing contained herein shall be construed as consent by Lessor to any holding over by Lessee.
27. CumulaƟve Remedies. No remedy or elecƟon hereunder shall be deemed exclusive but shall, wherever possible, be cumulaƟve with all other remedies at law or in equity.
28. Covenants and CondiƟons; ConstrucƟon of Agreement. All provisions of this Lease to be observed or performed by Lessee are both covenants and condiƟons.
In construing this Lease, all headings and Ɵtles are for the convenience of the ParƟes only and shall not be considered a part of this Lease. Whenever required by the context, the singular shall include the plural and vice versa. This Lease shall not be construed as if prepared by one of the ParƟes, but rather according to itsfair meaning as a whole, asif both ParƟes had prepared it.
29. Binding Effect; Choice of Law. This Lease shall be binding upon the ParƟes, their personal representaƟves, successors and assigns and be governed by the laws of the State in which the Premises are located. Any liƟgaƟon between the ParƟes hereto concerning this Lease shall be iniƟated in the county in which the Premises
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are located. Signatures to this Lease accomplished by means of electronic signature or similar technology shall be legal and binding.
30. SubordinaƟon; AƩornment; NonDisturbance.
30.1 SubordinaƟon. This Lease and any OpƟon granted hereby shall be subject and subordinate to any ground lease, mortgage, deed of trust, or other hypothecaƟon or security device (collecƟvely, "Security Device"), now or hereaŌer placed upon the Premises, to any and all advances made on the security thereof, and to all renewals, modificaƟons, and extensions thereof. Lessee agrees that the holders of any such Security Devices (in this Lease together referred to as "Lender") shall have no liability or obligaƟon to perform any of the obligaƟons of Lessor under this Lease. Any Lender may elect to have this Lease and/or any OpƟon granted hereby superior to the lien of its Security Device by giving wriƩen noƟce thereof to Lessee, whereupon this Lease and such OpƟonsshall be deemed prior to such Security Device, notwithstanding the relaƟve dates of the documentaƟon or recordaƟon thereof.
30.2 AƩornment.In the event that Lessor transfers Ɵtle to the Premises, or the Premises are acquired by another upon the foreclosure or terminaƟon of a Security Device to which this Lease is subordinated (i) Lessee shall, subject to the nondisturbance provisions of Paragraph 30.3, aƩorn to such new owner, and upon request, enter into a new lease, containing all of the terms and provisions of this Lease, with such new owner for the remainder of the term hereof, or, at the elecƟon of the new owner, this Lease will automaƟcally become a new lease between Lessee and such new owner, and (ii) Lessor shall thereaŌer be relieved of any further obligaƟons hereunder and such new owner shall assume all of Lessor's obligaƟons, except that such new owner shall not: (a) be liable for any act or omission of any prior lessor or with respect to events occurring prior to acquisiƟon of ownership; (b) be subject to any offsets or defenses which Lessee might have against any prior lessor, (c) be bound by prepayment of more than one month'srent, or (d) be liable for the return of any security deposit paid to any prior lessor which was not paid or credited to such new owner.
30.3 NonDisturbance. With respect to Security Devices entered into by Lessor aŌer the execuƟon of this Lease, Lessee'ssubordinaƟon of this Lease shall be subject to receiving a commercially reasonable nondisturbance agreement (a "NonDisturbance Agreement") from the Lender which NonDisturbance Agreement provides that Lessee's possession of the Premises, and this Lease, including any opƟonsto extend the term hereof, will not be disturbed so long as Lessee is not in Breach hereof and aƩorns to the record owner of the Premises. Further, within 60 days aŌer the execuƟon of this Lease, Lessorshall, if requested by Lessee, use its commercially reasonable effortsto obtain a NonDisturbance Agreement from the holder of any preexisƟng Security Device which issecured by the Premises. In the event that Lessor is unable to provide the NonDisturbance Agreement within said 60 days, then Lessee may, at Lessee's opƟon, directly contact Lender and aƩempt to negoƟate for the execuƟon and delivery of a NonDisturbance Agreement.
30.4 SelfExecuƟng. The agreements contained in this Paragraph 30 shall be effecƟve without the execuƟon of any further documents; provided, however, that, upon wriƩen request from Lessor or a Lender in connecƟon with a sale, financing or refinancing of the Premises, Lessee and Lessorshall execute such further wriƟngs as may be reasonably required to separately document any subordinaƟon, aƩornment and/or NonDisturbance Agreement provided for herein.
31. AƩorneys' Fees. If any Party or Broker brings an acƟon or proceeding involving the Premises whether founded in tort, contract or equity, or to declare rights hereunder, the Prevailing Party (as hereaŌer defined) in any such proceeding, acƟon, or appeal thereon, shall be enƟtled to reasonable aƩorneys' fees. Such fees may be awarded in the same suit or recovered in a separate suit, whether or not such acƟon or proceeding is pursued to decision or judgment. The term, "Prevailing Party" shall include, without limitaƟon, a Party or Broker who substanƟally obtains or defeats the relief sought, asthe case may be, whether by compromise, seƩlement, judgment, or the abandonment by the other Party or Broker of its claim or defense. TheaƩorneys' fees award shall not be computed in accordance with any court fee schedule, but shall be such as to fully reimburse all aƩorneys' feesreasonably incurred. In addiƟon, Lessor shall be enƟtled to aƩorneys' fees, costs and expenses incurred in the preparaƟon and service of noƟces of Default and consultaƟons in connecƟon therewith, whether or not a legal acƟon issubsequently commenced in connecƟon with such Default or resulƟng Breach ($200 is a reasonable minimum per occurrence forsuch services and consultaƟon).
32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agentsshall have the right to enter the Premises at any Ɵme, in the case of an emergency, and otherwise at reasonable Ɵmes aŌer reasonable prior noƟce for the purpose of showing the same to prospecƟve purchasers, lenders, or tenants, and making such alteraƟons, repairs, improvements or addiƟons to the Premises as Lessor may deem necessary or desirable and the erecƟng, using and maintaining of uƟliƟes, services, pipes and conduits through the Premises and/or other premises as long asthere is no material adverse effect on Lessee's use of the Premises. All such acƟviƟesshall be without abatement of rent or liability to Lessee.
33. AucƟons. Lessee shall not conduct, nor permit to be conducted, any aucƟon upon the Premises without Lessor's prior wriƩen consent. Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to permit an aucƟon.
34. Signs. Lessor may place on the Premises ordinary "For Sale" signs at any Ɵme and ordinary "For Lease" signs during the last 6 months of the term hereof. Except for ordinary "For Sublease" signs which may be placed only on the Premises, Lessee shall not place any sign upon the Project without Lessor's prior wriƩen consent.
All signs must comply with all Applicable Requirements.
35. TerminaƟon; Merger. Unlessspecifically stated otherwise in wriƟng by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual terminaƟon or cancellaƟon hereof, or a terminaƟon hereof by Lessor for Breach by Lessee,shall automaƟcally terminate any sublease or lesser estate in the Premises; provided, however, that Lessor may elect to conƟnue any one or all exisƟng subtenancies. Lessor'sfailure within 10 days following any such event to elect to the contrary by wriƩen noƟce to the holder of any such lesser interest,shall consƟtute Lessor's elecƟon to have such event consƟtute the terminaƟon of such interest.
36. Consents. All requests for consent shall be in wriƟng. Except as otherwise provided herein, wherever in this Lease the consent of a Party isrequired to an act by or for the other Party,such consent shall not be unreasonably withheld or delayed. Lessor's actual reasonable costs and expenses (including but not limited to architects', aƩorneys', engineers' and other consultants' fees) incurred in the consideraƟon of, or response to, a request by Lessee for any Lessor consent, including but not limited to consentsto an assignment, a subleƫng or the presence or use of a Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporƟng documentaƟon therefor. Lessor's consent to any act, assignment or subleƫng shall not consƟtute an acknowledgment that no Default or Breach by Lessee of this Lease exists, norshall such consent be deemed a waiver of any then exisƟng Default or Breach, except as may be otherwise specifically stated in wriƟng by Lessor at the Ɵme of such consent. The failure to specify herein any parƟcular condiƟon to Lessor's consent shall not preclude the imposiƟon by Lessor at the Ɵme of consent of such further or other condiƟons as are then reasonable with reference to the parƟcular maƩer for which consent is being given. In the event that either Party disagrees with any determinaƟon made by the other hereunder and reasonably requests the reasonsfor such determinaƟon, the determining party shall furnish itsreasons in wriƟng and in reasonable detail within 10 business daysfollowing such request.
37. Guarantor.
37.1 ExecuƟon. The Guarantors, if any, shall each execute a guaranty in the form most recently published by AIR CRE.
37.2 Default.Itshall consƟtute a Default of the Lessee if any Guarantor fails or refuses, upon request to provide: (a) evidence of the execuƟon of the guaranty, including the authority of the party signing on Guarantor's behalf to obligate Guarantor, and in the case of a corporate Guarantor, a cerƟfied copy of a resoluƟon of its
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board of directors authorizing the making of such guaranty, (b) current financial statements, (c) an Estoppel CerƟficate, or (d) wriƩen confirmaƟon that the guaranty is sƟll in effect.
38. Quiet Possession. Subject to payment by Lessee of the Rent and performance of all of the covenants, condiƟons and provisions on Lessee's part to be observed and performed under this Lease, Lessee shall have quiet possession and quiet enjoyment of the Premises during the term hereof.
39. OpƟons. If Lessee is granted any opƟon, as defined below, then the following provisions shall apply.
39.1 DefiniƟon."OpƟon" shall mean: (a) the right to extend or reduce the term of or renew this Lease or to extend or reduce the term of or renew any lease that Lessee has on other property of Lessor; (b) the right of first refusal or first offer to lease either the Premises or other property of Lessor; (c) the right to purchase, the right of first offer to purchase or the right of first refusal to purchase the Premises or other property of Lessor.
39.2 OpƟons Personal To Original Lessee. Any OpƟon granted to Lessee in this Lease is personal to the original Lessee, and cannot be assigned or exercised by anyone other than said original Lessee and only while the original Lessee isin full possession of the Premises and, if requested by Lessor, with Lessee cerƟfying that Lessee has no intenƟon of thereaŌer assigning orsubleƫng.
39.3 MulƟple OpƟons.In the event that Lessee has any mulƟple OpƟonsto extend or renew this Lease, a later OpƟon cannot be exercised unlessthe prior OpƟons have been validly exercised.
39.4 Effect of Default on OpƟons.
(a) Lessee shall have no right to exercise an OpƟon: (i) during the period commencing with the giving of any noƟce of Default and conƟnuing unƟl said Default is cured, (ii) during the period of Ɵme any Rent is unpaid (without regard to whether noƟce thereof is given Lessee), (iii) during the Ɵme Lessee is in Breach of this Lease, or (iv) in the event that Lessee has been given 3or more noƟces of separate Default, whether or not the Defaults are cured, during the 12 month period immediately preceding the exercise of the OpƟon.
(b) The period of Ɵme within which an OpƟon may be exercised shall not be extended or enlarged by reason of Lessee's inability to exercise an OpƟon because of the provisions of Paragraph 39.4(a).
(c) An OpƟon shall terminate and be of no further force or effect, notwithstanding Lessee's due and Ɵmely exercise of the OpƟon, if, aŌer such exercise and prior to the commencement of the extended term or compleƟon of the purchase, (i) Lessee failsto pay Rent for a period of 30 days aŌer such Rent becomes due (without any necessity of Lessor to give noƟce thereof), or (ii) if Lessee commits a Breach of this Lease.
40. Security Measures. Lessee hereby acknowledges that the Rent payable to Lessor hereunder does not include the cost of guard service or other security measures, and that Lessor shall have no obligaƟon whatsoever to provide same. Lessee assumes all responsibility for the protecƟon of the Premises, Lessee, its agents and invitees and their property from the acts of third parƟes.
41. ReservaƟons. Lessor reservesthe right: (i) to grant, without the consent or joinder of Lessee,such easements, rights and dedicaƟons that Lessor deems necessary; (ii) to cause the recordaƟon of parcel maps and restricƟons; and (iii) to create and/or install new uƟlity raceways,so long assuch easements, rights, dedicaƟons, maps, restricƟons, and uƟlity raceways do not unreasonably interfere with the use of the Premises by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate such rights.
42. Performance Under Protest. If at any Ɵme a dispute shall arise as to any amount orsum of money to be paid by one Party to the other under the provisions hereof, the Party against whom the obligaƟon to pay the money is asserted shall have the right to make payment "under protest" and such paymentshall not be regarded as a voluntary payment and there shall survive the right on the part of said Party to insƟtute suit for recovery of such sum. If it shall be adjudged that there was no legal obligaƟon on the part of said Party to pay such sum or any part thereof, said Party shall be enƟtled to recover such sum or so much thereof asit was not legally required to pay. A Party who does not iniƟate suit for the recovery of sums paid "under protest" within 6 monthsshall be deemed to have waived itsright to protest such payment.
43. Authority; MulƟple ParƟes; ExecuƟon.
(a) If either Party hereto is a corporaƟon, trust, limited liability company, partnership, or similar enƟty, each individual execuƟng this Lease on behalf of such enƟty represents and warrantsthat he orshe is duly authorized to execute and deliver this Lease on its behalf. Each Party shall, within 30 days aŌer request, deliver to the other Party saƟsfactory evidence of such authority. (b) If this Lease is executed by more than one person or enƟty as "Lessee", each such person or enƟty shall be jointly and severally liable hereunder. It is agreed that any one of the named Lesseesshall be empowered to execute any amendment to this Lease, or other document ancillary thereto and bind all of the named Lessees, and Lessor may rely on the same asif all of the named Lessees had executed such document. (c) This Lease may be executed by the ParƟesin counterparts, each of which shall be deemed an original and all of which together shall consƟtute one and the same instrument.
44. Conflict. Any conflict between the printed provisions of this Lease and the typewriƩen or handwriƩen provisions shall be controlled by the typewriƩen or handwriƩen provisions.
45. Offer. PreparaƟon of this Lease by either party or their agent and submission of same to the other Party shall not be deemed an offer to lease to the other Party. This Lease is not intended to be binding unƟl executed and delivered by all ParƟes hereto.
46. Amendments. This Lease may be modified only in wriƟng,signed by the ParƟesin interest at the Ɵme of the modificaƟon. Aslong asthey do not materially change Lessee's obligaƟons hereunder, Lessee agreesto make such reasonable nonmonetary modificaƟonsto this Lease as may be reasonably required by a Lender in connecƟon with the obtaining of normal financing or refinancing of the Premises.
47. Waiver of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT.
48. ArbitraƟon of Disputes. An Addendum requiring the ArbitraƟon of all disputes between the ParƟes and/or Brokers arising out of this Lease is is not aƩached to this Lease.
49. Accessibility; Americans with DisabiliƟes Act.
(a) The Premises:
have not undergone an inspecƟon by a CerƟfied Access Specialist (CASp). Note: A CerƟfied Access Specialist (CASp) can inspect the subject premises and
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determine whether the subject premises comply with all of the applicable construcƟonrelated accessibility standards under state law. Although state law does not require a CASp inspecƟon of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspecƟon of the subject premisesfor the occupancy or potenƟal occupancy of the lessee or tenant, if requested by the lessee or tenant. The parƟesshall mutually agree on the arrangementsfor the Ɵme and manner of the CASp inspecƟon, the payment of the fee for the CASp inspecƟon, and the cost of making any repairs necessary to correct violaƟons of construcƟonrelated accessibility standards within the premises. have undergone an inspecƟon by a CerƟfied Access Specialist (CASp) and it was determined that the Premises met all applicable construcƟonrelated accessibility standards pursuant to California Civil Code §55.51 etseq. Lessee acknowledges that it received a copy of the inspecƟon report at least 48 hours prior to execuƟng this Lease and agreesto keep such report confidenƟal.
have undergone an inspecƟon by a CerƟfied Access Specialist (CASp) and it was determined that the Premises did not meet all applicable construcƟonrelated accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledges that it received a copy of the inspecƟon report at least 48 hours prior to execuƟng this Lease and agreesto keep such report confidenƟal except as necessary to complete repairs and correcƟons of violaƟons of construcƟon related accessibility standards.
In the event that the Premises have been issued an inspecƟon report by a CASp the Lessorshall provide a copy of the disability accessinspecƟon cerƟficate to Lessee within 7 days of the execuƟon of this Lease.
(b) Since compliance with the Americans with DisabiliƟes Act (ADA) and otherstate and local accessibility statutes are dependent upon Lessee'sspecific use of the Premises, Lessor makes no warranty or representaƟon as to whether or not the Premises comply with ADA or any similar legislaƟon. In the event that Lessee's use of the Premisesrequires modificaƟons or addiƟons to the Premisesin order to be in compliance with ADA or other accessibility statutes, Lessee agrees to make any such necessary modificaƟons and/or addiƟons at Lessee's expense.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES.
ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY AIR CRE OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO:
1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.
2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT AND THE SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE.
WARNING: IF THE PREMISES ARE LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN WHICH THE PREMISES ARE LOCATED.
The parƟes hereto have executed this Lease at the place and on the dates specified above their respecƟve signatures.
Executed at:
On:
By LESSOR:
The Institute of Electrical and Electronics Engineers
By:
Name Printed:
Title:
Phone:
Fax:
Email:
By:
Name Printed:
Title:
Phone:
Fax:
Email:
Address:
Federal ID No.:
Executed at:
On:
By LESSEE:
The City of Los Alamitos
By:
Name Printed:
Title:
Phone:
Fax:
Email:
By:
Name Printed:
Title:
Phone:
Fax:
Email:
Address:
Federal ID No.:
BROKER
Lee & Associates Commercial Real Estate Services, Inc.
- South Bay dba Lee & Associates Los Angeles- Long
Beach, Inc.
BROKER
Lee & Associates Commercial Real Estate Services, Inc., - South Bay dba Lee & Associates Los Angeles - Long
Beach, Inc.
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© 2019 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM MTG24.40, Revised 10222020 Page 18 of 18
AƩn: Shaun McCullough
Title: Principal
Address: 5000 E Spring Street, Suite 600
Long Beach, CA 90815
Phone: 562-354-2500
Fax: 562-354-2501
Email: [email protected]
Federal ID No.: 33-0381802
Broker DRE License #: 01069854
Agent DRE License #: 01380928
AƩn: Shaun McCullough
Title: Principal
Address: 5000 E Spring Street, Suite 600
Long Beach, CA 90815
Phone: 562-354-250
Fax: 0562-354-2501
Email: [email protected]
Federal ID No.: 33-0381802
Broker DRE License #: 01069854
Agent DRE License #: 01380928
AIR CRE * hƩps://www.aircre.com * 2136878777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
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© 2017 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM OE7.00, Revised 11052021 Page 1 of 2
OPTION(S) TO EXTEND TERM
STANDARD LEASE ADDENDUM
Dated: January 12, 2023
By and Between
Lessor: The Institute of Electrical and Electronics Engineers Lessee: The City of Los Alamitos
Property Address: 10662 Los Vaqueros Circle, Los Alamitos, CA 90720 (street address, city,state, zip)
Paragraph: 50 OPTION(S) TO EXTEND TERM. Subject to the terms, condiƟons and provisions of Paragraph 39, Lessor grants Lessee two (2) opƟon(s) to extend the term of the Lease ("Extension OpƟon(s)"), with each Extension OpƟon being for a term of thirty-six (36) months, commencing when the prior term expires("OpƟon Term(s)"). In order to exercise an Extension OpƟon, Lessee must give wriƩen noƟce of such elecƟon to Lessor and Lessor must receive such noƟce at least three (3) but not more than six (6) months prior to the date that the applicable OpƟon Term would commence, Ɵme being of the essence. If Ɵmely and proper noƟficaƟon of the exercise of an Extension OpƟon is not given by Lessee and/or received by Lessor,such Extension OpƟon shall automaƟcally expire. Except as specifically modified, the terms, condiƟons and provisions of the Lease shall apply during OpƟon Terms but the amount of Rent during OpƟon Termsshall be established by using the method(s) selected below (check method(s) to be used and fill in appropriately):
I. Consumer Price Index.
(a) During the OpƟon Term(s) which start(s) on , the monthly Base Rent shall be increased on and every months thereaŌer during such OpƟon Term(s) ("OpƟon Term CPI Increase Date(s)") commensurate with the increase in the OpƟon Term CPI (as herein defined) determined as follows: the monthly Base Rent scheduled for the month immediately preceding the first occurring OpƟon Term CPI Increase Date shall be mulƟplied by a fracƟon the denominator of which is the OpƟon Term Base CPI (as herein defined), and the numerator of which is the OpƟon Term Comparison CPI (as herein defined). The amountso calculated shall consƟtute the new Base Rent unƟl the next OpƟon Term CPI Increase Date during the applicable OpƟon Term, but in no eventshall any such new Base Rent be lessthan the Base Rent for the month immediately preceding the applicable OpƟon Term CPI Increase Date. (b) The term "OpƟon Term CPI" shall mean the Consumer Price Index of the Bureau of Labor StaƟsƟcs of the U.S. Department of Labor for (select one):
CPI W (Urban Wage Earners and Clerical Workers) or CPI U (All Urban Consumers), for (fill in Urban Area): or the area in which the Premises is located, All Items (19821984 = 100). The term "OpƟon Term Comparison CPI" shall mean the CPI of the calendar month which is 2 full months prior to the applicable OpƟon Term CPI Increase Date. The term "OpƟon Term Base CPI" shall mean the CPI of the calendar month which is 2 full months prior to (select one): Commencement Date of the Original Term, start of the applicable OpƟon Term, or (fill in month). (c) If compilaƟon and/or publicaƟon of the CPI istransferred to another governmental department, bureau or agency or is disconƟnued, then instead the index most nearly the same asthe CPI shall be used to calculate the Base Rent increases hereunder. If the ParƟes cannot agree on such alternaƟve index, then the maƩershall be submiƩed for decision to the American ArbitraƟon AssociaƟon in accordance with the then rules of said associaƟon and the decision of the arbitrators shall be binding upon the parƟes, with the cost of such arbitraƟon being paid equally by the ParƟes.
II. Fixed Percentage. During the OpƟon Term(s) which start(s) on , the monthly Base Rent shall be increased on and every months thereaŌer during such OpƟon Term(s) ("OpƟon Term Percentage Increase Date(s)") by percent ( %) of the monthly Base Rent scheduled to be paid for the month immediately preceding the applicable OpƟon Term Percentage Increase Date.
III. Fair Market Value.
(a) During the OpƟon Term(s) which start(s) on 37 months after the initial Lease Term , the amount of Rent shall be the amount forecasted to be the fair market rental value of the Premises during such OpƟon Term established pursuant to the procedures, terms, assumpƟons and condiƟons set forth herein ("Fair Market Value"); provided, however, regardless of such Fair Market Value, Base Rent during an OpƟon Term shall not be less than the Base Rentscheduled as of when the prior term expires. StarƟng as of Lessee's exercise of the applicable Extension OpƟon (but not earlier than six (6) months before start of the applicable OpƟon Term), the ParƟes shall for thirty (30) days ("NegoƟaƟon Period") aƩempt to agree upon the Fair Market Value. If during the NegoƟaƟon Period the ParƟes do not agree on the Fair Market Value, then the Fair Market Value shall be established pursuant to the procedures set forth herein, which shall be binding. (b) Each Party shall, within fiŌeen (15) days aŌer the end of the NegoƟaƟon Period, in wriƟng submit to the other Party such Party's determinaƟon of the Fair Market Value ("SubmiƩed Value(s)"). If a Party fails to Ɵmely provide a SubmiƩed Value, then the other Party's SubmiƩed Value shall be the Fair Market Value. If both ParƟes Ɵmely provide SubmiƩed Values, then each Party shall, within fiŌeen (15) days aŌer both ParƟes have exchanged SubmiƩed Values, in wriƟng noƟfy the other Party of such Party'sselected arbitrator who shall meet the qualificaƟons set forth herein ("Advocate Arbitrator(s)"). Lessor and Lessee may select an Advocate Arbitrator who isfavorable to such Party's posiƟon and may, prior to or aŌer appointment of an Advocate Arbitrator, consult with such Party's Advocate Arbitrator. If a Party failsto Ɵmely and properly provide noƟce of such Party's chosen Advocate Arbitrator, then the other Party's SubmiƩed Value shall be the Fair Market Value. (c) If both ParƟes Ɵmely and properly designate Advocate Arbitrators, then such Advocate Arbitratorsshall, within fiŌeen (15) days aŌer theirselecƟon, choose a third (3rd) neutral arbitrator who shall meet the qualificaƟons set forth herein ("Neutral Arbitrator"). The Neutral Arbitratorshall be engaged jointly by Lessor and Lessee. If Advocate Arbitrators fail to agree upon and Ɵmely appoint a Neutral Arbitrator, then the President of AIR CRE shall appointsuch Neutral Arbitrator within fiŌeen (15) days aŌer request by either Party. If the President of AIR CRE does not Ɵmely appoint the Neutral Arbitrator, then either Party may file an appropriate legal acƟon for a judge with competent jurisdicƟon over the ParƟesto appoint the Neutral Arbitrator.
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© 2017 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM OE7.00, Revised 11052021 Page 2 of 2
(d) The Advocate Arbitrators and the Neutral Arbitrator ("Arbitrator(s)") shall be duly licensed real estate brokers orsalespersons in good standing in the state in which the Premises islocated, shall have been acƟve over the five (5) year period before their appointment in the leasing of properƟes similar to the Premises within the general real estate market of the Premises. The Neutral Arbitrator shall addiƟonally not be related to or affiliated with either Party or Advocate Arbitrator, and shall not have previously represented in a real estate transacƟon a Party or anyone related to or affiliated with a Party. All maƩersto be determined by the Arbitrators shall be decided by a majority vote of the Arbitrators, with each Arbitrator having one (1) vote. The Arbitrators may, asthe Arbitrators determine, hold hearings and require briefs, including market data and addiƟonal informaƟon. (e) Within thirty (30) days aŌerselecƟon of the Neutral Arbitrator, the three Arbitrators shall first reach a decision as to their own independent opinion of the Fair Market Value established by taking into account the terms, assumpƟons and condiƟons set forth herein ("Arbitrators' Market Value"), then decide which Party's SubmiƩed Value is closer in monetary amount to the Arbitrators' Market Value ("Selected Market Value"), then provide the ParƟes a copy of the Arbitrators' Market Value and finally noƟfy the ParƟes of the Selected Market Value. The Selected Market Value shall be the Fair Market Value. The Arbitratorsshall have no right to decide a Selected Market Value which is a compromise to (or modificaƟon of) the SubmiƩed Values. The decision of the Arbitrators shall be binding upon the ParƟes.
The Party whose SubmiƩed Value is not the Selected Market Value shall, within ten (10) days aŌer the Arbitrators decide the Selected Market Value, pay the fees and costs of all three (3) Arbitrators.
(f) If the Fair Market Value has not been established before the start of the applicable OpƟon Term, then Lessee shall conƟnue to pay to Lessor rent in the amount payable for the month immediately preceding the start of such OpƟon Term and Lessor's acceptance of such rent shall not waive, adversely affect or prejudice the ParƟes' right to complete establishment of the Fair Market Value or Lessor'sright to collect the full amount of the Fair Market Value once the Fair Market Value is established. Lessee shall, within ten (10) days aŌer establishment of the Fair Market Value, pay to Lessor any deficiency in rent then due for the OpƟon Term.
Following establishment of Fair Market Value, the ParƟesshall, within ten (10) days aŌer request by either Party,sign an amendment to this Lease to confirm the Fair Market Value and the expiraƟon date of this Lease, but the ParƟes' failure to request or to sign such an amendment shall not affect establishment of the Fair Market Value or extension of the Lease term.
(g) The Arbitrators, in deciding the Arbitrators' Market Value, shall take into account rent rates, rent abatements, periodic rent increases, real property taxes, insurance premiums and other operaƟng expenses, tenant improvement and other applicable allowances, building services, length of lease term and other factors professional real estate brokers and/or appraisers customarily consider in determining fair market rent of property in an arm'slength transacƟon by ready, willing and able parƟes forspace of comparable locaƟon, size, age, condiƟon, quality, parking, visibility, view, signage and accessibility if the Premises were marketed in a normal and customary manner for a reasonable length of Ɵme on the open market to be leased to a tenant with financial strength and credit worthiness comparable to Lessee and guarantors (if any) of this Lease (as of Lessee's exercise of the Extension OpƟon) for a term comparable to the length of the applicable OpƟon Term and used for the Agreed Use (or other reasonably comparable uses). The Arbitrators, in deciding the Arbitrators' Market Value, shall not consider as a comparable transacƟon any of the following: a sublease, lease assignment, lease renewal or extension; lease with a tenant that has equity, isrelated to or affiliated with the landlord; or a lease of space that wassubject to a right of first refusal, right of first offer, expansion opƟon or other encumbrances. The Arbitrators, in deciding the Arbitrators' Market Value,shall reduce the Fair Market Value on account of AlteraƟons and improvements made by Lessee to the extent the cost thereof was paid solely by Lessee (in excess of any applicable improvement allowance, abated rent in lieu of improvement allowance or other consideraƟon provided by Lessor for Lessee'simprovement of the Premises),shall not reduce the Fair Market Value on account of any real estate brokerage commission savings by Lessor, and shall not reduce the Fair Market Value on account of deferred maintenance or repair of the Premisesfor which Lessee was responsible under the Lease but did not perform.
IV. Fixed Rental Adjustment(s) ("FRA").
The monthly Base Rent shall be increased to the following amounts on the dates set forth below:
On (fill in FRA Adjustment Date(s)): The new Base Rent shall be:
V. ConƟnuaƟon of Original Term Adjustments.
The monthly Base Rent during the OpƟon Term(s) which start(s) on shall be increased in accordance with the same formula provided in the Lease to be used to calculate increases in the Base Rent during the Original Term of the Lease.
BROKER'S FEE: For each adjustment in Base Rent specified above, the Brokersshall be paid a Brokerage Fee in accordance with paragraph 15 of the Lease or if applicable, paragraph 9 of the Sublease.
AIR CRE * hƩps://www.aircre.com * 2136878777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
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© 2017 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM ADD1.03, Revised 10222020 Page 1 of 1
ADDENDUM TO LEASE
Date: January 12, 2023
By and Between
Lessor: The Institute of Electrical and Electronics Engineers Lessee: The City of Los Alamitos
Property Address: 10662 Los Vaqueros Circle, Los Alamitos, CA 90720 (street address, city,state, zip)
Paragraph: 51 - 53
In the event of any conflict between the provisions of this Addendum and the printed provisions of the Lease, this Addendum shall control.
51. This Standard Multi-Tenant Office Lease-Gross, has been prepared by Lee & Associates Commercial Real Estate Services, Inc. - South Bay dba Lee & Associates Los Angeles - Long Beach, Inc. at the request of Lessor and Lessee. This Lessor and Lessee agree to indemnify and hold harmless Lee & Associates Commercial Real Estate Services, Inc. - South Bay dba Lee & Associates Los Angeles - Long Beach, Inc. , its respective Agents and Employees, for any Liability of Loss, including without limitation, Attorney fees and costs that may be occasioned as a result of completing this Standard Multi-Tenant Office Lease-Gross. Lessor and Lessee acknowledge being advised by Lee & Associates Commercial Real Estate Services, Inc. - South Bay dba Lee & Associates Los Angeles - Long Beach, Inc. to have this Standard Multi-Tenant Office Lease-Gross reviewed by their respective Attorneys, Accountants, or Insurance Agents for professional advice. The information contained herein has been obtained from sources believed reliable, but not guaranteed. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. Lessee should conduct a careful, independent investigation of the property during their due diligence to determine to their satisfaction the accuracy and completeness of the information contained herein.
52. Base Rent shall increase five percent (5%) per annum on each anniversary date.
53. Lessee to take possession of the premises in an "As-Is" condition.
AIR CRE * hƩps://www.aircre.com * 2136878777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
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© 2019 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM AD3.01, Revised 10222020 Page 1 of 4
DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP
(As required by the Civil Code)
When you enter into a discussion with a real estate agent regarding a real estate transacƟon, you should from the outset understand what type of agency relaƟonship or representaƟon you wish to have with the agent in the transacƟon.
SELLER'S AGENT
A Seller's agent under a lisƟng agreement with the Seller acts asthe agent for the Seller only. A Seller's agent or a subagent of that agent hasthe following affirmaƟve obligaƟons:
To the Seller: A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Seller.
To the Buyer and the Seller:
(a) Diligent exercise of reasonable skill and care in performance of the agent's duƟes. (b) A duty of honest and fair dealing and good faith.
(c) A duty to disclose all facts known to the agent materially affecƟng the value or desirability of the property that are not known to, or within the diligent aƩenƟon and observaƟon of, the parƟes.
An agent is not obligated to reveal to either party any confidenƟal informaƟon obtained from the other party that does not involve the affirmaƟve duƟesset forth above.
BUYER'S AGENT
A Buyer's agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situaƟons, the agent is not the Seller's agent, even if by agreement the agent may receive compensaƟon forservicesrendered, either in full or in part from the Seller. An agent acƟng only for a Buyer hasthe following affirmaƟve obligaƟons:
To the Buyer: A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Buyer.
To the Buyer and the Seller:
(a) Diligent exercise of reasonable skill and care in performance of the agent's duƟes. (b) A duty of honest and fair dealing and good faith.
(c) A duty to disclose all facts known to the agent materially affecƟng the value or desirability of the property that are not known to, or within the diligent aƩenƟon and observaƟon of, the parƟes.
An agent is not obligated to reveal to either party any confidenƟal informaƟon obtained from the other party that does not involve the affirmaƟve duƟesset forth above.
AGENT REPRESENTING BOTH SELLER AND BUYER
A real estate agent, either acƟng directly or through one or more salesperson and broker associates, can legally be the agent of both the Seller and the Buyer in a transacƟon, but only with the knowledge and consent of both the Seller and the Buyer.
In a dual agency situaƟon, the agent hasthe following affirmaƟve obligaƟons to both the Seller and the Buyer:
(a) A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either the Seller or the Buyer. (b) Other duƟes to the Seller and the Buyer as stated above in their respecƟve secƟons.
In represenƟng both Seller and Buyer, a dual agent may not, without the express permission of the respecƟve party, disclose to the other party confidenƟal informaƟon, including, but not limited to, facts relaƟng to either the Buyer's or Seller's financial posiƟon, moƟvaƟons, bargaining posiƟon, or other personal informaƟon that may impact price, including the Seller's willingness to accept a price less than the lisƟng price or the Buyer's willingnessto pay a price greater than the price offered.
SELLER AND BUYER RESPONSIBILITIES
Either the purchase agreement or a separate document will contain a confirmaƟon of which agent is represenƟng you and whether that agent isrepresenƟng you exclusively in the transacƟon or acƟng as a dual agent. Please pay aƩenƟon to that confirmaƟon to make sure it accurately reflects your understanding of your agent’s role. The above duƟes of the agent in a real estate transacƟon do not relieve a Seller or Buyer from the responsibility to protect his or her own interests. You should carefully read all agreements to assure that they adequately express your understanding of the transacƟon. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired, consult a competent professional. If you are a Buyer, you have the duty to exercise reasonable care to protect yourself, including as to those facts about the property which are known to you or within your diligent aƩenƟon and observaƟon. Both Sellers and Buyersshould strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transacƟon can be complex and subject to change.
Throughout your real property transacƟon you may receive more than one disclosure form, depending upon the number of agents assisƟng in the transacƟon. The law requires each agent with whom you have more than a casual relaƟonship to present you with this disclosure form. You should read its contents each Ɵme it is presented to you, considering the relaƟonship between you and the real estate agent in yourspecific transacƟon. This disclosure form includes the provisions of SecƟons 2079.13 to 2079.24, inclusive, of the Civil Code set forth on page 2. Read it carefully. I/WE ACKNOWLEDGE RECEIPT OF A COPY OF THIS DISCLOSURE AND THE PORTIONS OF THE CIVIL CODE PRINTED ON THE BACK (OR A SEPARATE PAGE).
Lessee: Name Printed: ___________, Title: ____________, Company Name: City of Los Alamitos Buyer Seller Lessor Lessee x Date:
Buyer Seller Lessor Lessee Date:
Agent: Lee & Associates Commercial Real Estate Services Inc. - South Bay dba Lee & Associates Los Angeles - Long Beach, Inc . DRE Lic. #: 01069854
Real Estate Broker (Firm)
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© 2019 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM AD3.01, Revised 10222020 Page 2 of 4
By: Shaun McCullough, Principal DRE Lic. #: 01380928 Date:
(Salesperson or BrokerAssociate)
THIS FORM HAS BEEN PREPARED BY AIR CRE. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ADEQUACY OF THIS FORM FOR ANY SPECIFIC TRANSACTION. PLEASE SEEK LEGAL COUNSEL AS TO THE APPROPRIATENESS OF THIS FORM.
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© 2019 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM AD3.01, Revised 10222020 Page 3 of 4
DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP
CIVIL CODE SECTIONS 2079.13 THROUGH 2079.24 (2079.16 APPEARS ON THE FRONT) 2079.13.As used in SecƟons 2079.7 and 2079.14 to 2079.24, inclusive, the following terms have the following meanings:
(a) “Agent” means a person acƟng under provisions of Title 9 (commencing with SecƟon 2295) in a real property transacƟon, and includes a person who is licensed as a real estate broker under Chapter 3 (commencing with SecƟon 10130) of Part 1 of Division 4 of the Business and Professions Code, and under whose license a lisƟng is executed or an offer to purchase is obtained. The agent in the real property transacƟon bears responsibility for that agent’s salespersons or broker associates who perform as agents of the agent. When a salesperson or broker associate owes a duty to any principal, or to any buyer or seller who is not a principal, in a real property transacƟon, that duty is equivalent to the duty owed to that party by the broker for whom the salesperson or broker associate funcƟons. (b) “Buyer” means a transferee in a real property transacƟon, and includes a person who executes an offer to purchase real property from a seller through an agent, or who seeks the services of an agent in more than a casual, transitory, or preliminary manner, with the object of entering into a real property transacƟon. “Buyer” includes vendee or lessee of real property. (c) “Commercial real property” means all real property in the state, except (1) singlefamily residenƟal real property, (2) dwelling units made subject to Chapter 2 (commencing with SecƟon 1940) of Title 5, (3) a mobile home, as defined in SecƟon 798.3, (4) vacant land, or (5) a recreaƟonal vehicle, as defined in SecƟon 799.29. (d) “Dual agent” means an agent acƟng, either directly or through a salesperson or broker associate, as agent for both the seller and the buyer in a real property transacƟon. (e) “LisƟng agreement” means a wriƩen contract between a seller of real property and an agent, by which the agent has been authorized to sell the real property or to find or obtain a buyer, including rendering other servicesfor which a real estate license isrequired to the seller pursuant to the terms of the agreement. (f) “Seller's agent” means a person who has obtained a lisƟng of real property to act as an agent for compensaƟon. (g) “LisƟng price” is the amount expressed in dollars specified in the lisƟng for which the seller is willing to sell the real property through the seller’s agent. (h) “Offering price” is the amount expressed in dollars specified in an offer to purchase for which the buyer is willing to buy the real property. (i) “Offer to purchase” means a wriƩen contract executed by a buyer acƟng through a buyer’s agent that becomes the contract for the sale of the real property upon acceptance by the seller. (j) “Real property” means any estate specified by subdivision (1) or (2) of SecƟon 761 in property, and includes (1) singlefamily residenƟal property, (2) mulƟunit residenƟal property with more than four dwelling units, (3) commercial real property, (4) vacant land, (5) a ground lease coupled with improvements, or (6) a manufactured home as defined in SecƟon 18007 of the Health and Safety Code, or a mobile home as defined in SecƟon 18008 of the Health and Safety Code, when offered for sale or sold through an agent pursuant to the authority contained in SecƟon 10131.6 of the Business and Professions Code. (k) “Real property transacƟon” means a transacƟon for the sale of real property in which an agent is retained by a buyer, seller, or both a buyer and seller to act in that transacƟon, and includes a lisƟng or an offer to purchase. (l) “Sell,” “sale,” or “sold” refers to a transacƟon for the transfer of real property from the seller to the buyer and includes exchanges of real property between the seller and buyer, transacƟons for the creaƟon of a real property sales contract within the meaning of SecƟon 2985, and transacƟons for the creaƟon of a leasehold exceeding one year’s duraƟon. (m) “Seller” means the transferor in a real property transacƟon and includes an owner who listsreal property with an agent, whether or not a transfer results, or who receives an offer to purchase real property of which he or she is the owner from an agent on behalf of another. “Seller” includes both a vendor and a lessor of real property. (n) “Buyer's agent” means an agent who represents a buyer in a real property transacƟon. 2079.14. A seller’s agent and buyer’s agent shall provide the seller and buyer in a real property transacƟon with a copy of the disclosure form specified in SecƟon 2079.16, and shall obtain a signed acknowledgment of receipt from that seller and buyer, except as provided in SecƟon 2079.15, as follows: (a) The seller’s agent, if any, shall provide the disclosure form to the seller prior to entering into the lisƟng agreement. (b) The buyer’s agent shall provide the disclosure form to the buyer as soon as pracƟcable prior to execuƟon of the buyer’s offer to purchase. If the offer to purchase is not prepared by the buyer’s agent, the buyer’s agentshall present the disclosure form to the buyer not later than the next business day aŌer receiving the offer to purchase from the buyer. 2079.15. In any circumstance in which the seller or buyer refuses to sign an acknowledgment of receipt pursuant to SecƟon 2079.14, the agent shall set forth, sign, and date a wriƩen declaraƟon of the facts of the refusal. 2079.16 Reproduced on Page 1 of this AD form.
2079.17(a) As soon as pracƟcable, the buyer’s agent shall disclose to the buyer and seller whether the agent is acƟng in the real property transacƟon as the buyer’s agent, or as a dual agent represenƟng both the buyer and the seller. This relaƟonship shall be confirmed in the contract to purchase and sell real property or in a separate wriƟng executed or acknowledged by the seller, the buyer, and the buyer’s agent prior to or coincident with execuƟon of that contract by the buyer and the seller, respecƟvely. (b) As soon as pracƟcable, the seller’s agent shall disclose to the seller whether the seller’s agent is acƟng in the real property transacƟon as the seller’s agent, or as a dual agent represenƟng both the buyer and seller. This relaƟonship shall be confirmed in the contract to purchase and sell real property or in a separate wriƟng executed or acknowledged by the seller and the seller’s agent prior to or coincident with the execuƟon of that contract by the seller. (C) CONFIRMATION: The following agency relaƟonships are confirmed for thistransacƟon.
Seller's Brokerage Firm DO NOT COMPLETE, SAMPLE ONLY License Number Is the broker of (check one): the seller; or both the buyer and seller. (dual agent) Seller's Agent DO NOT COMPLETE, SAMPLE ONLY License Number Is (check one): the Seller's Agent. (salesperson or broker associate); or both the Buyer's Agent and the Seller's Agent. (dual agent) Buyer's Brokerage Firm DO NOT COMPLETE, SAMPLE ONLY License Number Is the broker of (check one): the buyer; or both the buyer and seller. (dual agent) Buyer's Agent DO NOT COMPLETE, SAMPLE ONLY License Number Is (check one): the Buyer's Agent. (salesperson or broker associate); or both the Buyer's Agent and the Seller's Agent. (dual agent) (d) The disclosures and confirmaƟon required by thissecƟon shall be in addiƟon to the disclosure required by SecƟon 2079.14. An agent’s duty to provide disclosure and confirmaƟon of representaƟon in thissecƟon may be performed by a real estate salesperson or broker associate affiliated with that broker. 2079.18 (Repealed pursuant to AB1289, 201718 California LegislaƟve session) 2079.19 The payment of compensaƟon or the obligaƟon to pay compensaƟon to an agent by the seller or buyer is not necessarily determinaƟve of a parƟcular agency relaƟonship between an agent and the seller or buyer. A lisƟng agent and a selling agent may agree to share any compensaƟon or commission paid, or any right to any compensaƟon or commission for which an obligaƟon arises as the result of a real estate transacƟon, and the terms of any such agreementshall not necessarily be determinaƟve of a parƟcular relaƟonship.
2079.20 Nothing in this arƟcle prevents an agent from selecƟng, as a condiƟon of the agent’s employment, a specific form of agency relaƟonship not specifically
________ ________
________ ________
INITIALS INITIALS
© 2019 AIR CRE. All Rights Reserved. Last Edited: 1/23/2023 10:34 AM AD3.01, Revised 10222020 Page 4 of 4
prohibited by this arƟcle if the requirements of SecƟon 2079.14 and SecƟon 2079.17 are complied with. 2079.21 (a) A dual agent may not, without the express permission of the seller, disclose to the buyer any confidenƟal informaƟon obtained from the seller. (b) A dual agent may not, without the express permission of the buyer, disclose to the seller any confidenƟal informaƟon obtained from the buyer. (c) “ConfidenƟal informaƟon” meansfacts relaƟng to the client’s financial posiƟon, moƟvaƟons, bargaining posiƟon, or other personal informaƟon that may impact price, such as the seller is willing to accept a price lessthan the lisƟng price or the buyer is willing to pay a price greater than the price offered. (d) ThissecƟon does not alter in any way the duty or responsibility of a dual agent to any principal with respect to confidenƟal informaƟon other than price. 2079.22 Nothing in this arƟcle precludes a seller’s agent from also being a buyer’s agent. If a seller or buyer in a transacƟon chooses to not be represented by an agent, that does not, of itself, make that agent a dual agent. 2079.23 (a) A contract between the principal and agent may be modified or altered to change the agency relaƟonship at any Ɵme before the performance of the act which is the object of the agency with the wriƩen consent of the parƟes to the agency relaƟonship. (b) A lender or an aucƟon company retained by a lender to control aspects of a transacƟon of real property subject to this part, including validaƟng the sales price,shall not require, as a condiƟon of receiving the lender’s approval of the transacƟon, the homeowner or lisƟng agent to defend or indemnify the lender or aucƟon company from any liability alleged to result from the acƟons of the lender or aucƟon company. Any clause, provision, covenant, or agreement purporƟng to impose an obligaƟon to defend or indemnify a lender or an aucƟon company in violaƟon of thissubdivision is against public policy, void, and unenforceable. 2079.24 Nothing in this arƟcle shall be construed to either diminish the duty of disclosure owed buyers and sellers by agents and their associate licensees,subagents, and employees or to relieve agents and their associate licensees,subagents, and employeesfrom liability for their conduct in connecƟon with acts governed by this arƟcle or for any breach of a fiduciary duty or a duty of disclosure.
AIR CRE * hƩps://www.aircre.com * 2136878777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: February 21, 2023 ITEM NUMBER: 10K
To: Mayor Tanya Doby & Members of the City Council
Presented By: Ron Noda, Development Services Director
Subject: Resolution No. 2023-08 - Beverage Container Recycling City/County Payment Program Funding
SUMMARY
This item requests Council's approval of a resolution concerning the City’s participation in Fiscal Year (FY) 2022-2023 California’s Department of Resources Recycling and Recovery (CalRecycle) Beverage Container Recycling City/County Payment Program. This program intends to aid in achieving and sustaining high recycling rates throughout the state of California.
RECOMMENDATION
1. Adopt Resolution No. 2023-08, entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, APPROVING THE CITY’S PARTICIPATION IN CALRECYCLE’S BEVERAGE CONTAINER RECYCLING CITY/COUNTY PROGRAM
DISTRIBUTION INTENDED TO AID ACHIEVING AND SUSTAINING HIGH RECYCLING RATES”; and,
2. Authorize the City Manager to execute all Beverage Container Recycling Program documents concerning beverage container recycling program funds distributed.
BACKGROUND
The California Department of Resources and Recovery (CalRecycle) administers a program to provide grant opportunities for beverage container recycling. One of the main goals of this program is to reach and maintain an 80 percent recycling rate for all California refund value beverage containers. In this case, CalRecycle will administer and disperse funding to participating jurisdictions, in an effort to help offset specific costs associated with the state’s recycling and waste management programs.
Via Senate Bill (SB) 1383, the State of California has emphasized the requirement for recycling of all waste generators, including residential, multi-family and commercial properties. Passed in 2016 and effective on January 1, 2022, SB 1383 is the most significant waste reduction mandate to be adopted in California in the last 30 years. SB 1383 requires the state to reduce organic waste (food waste, green waste, paper products, etc.) disposal by 75% by 2025.
DISCUSSION
The City of Los Alamitos has previously applied for CalRecycle's Beverage Container
Recycling City/County Payment Program the last two years and received $5,000 each year.
The funding received has been utilized to offset costs for a waste/ recycling consultant, Mike Balliet Consulting, for technical assistance and site visits, along with the development of educational outreach materials. If received, the grant will continue to fund these efforts.
The program does not require a funding match from the City.
FISCAL IMPACT
None.
Attachment: 1. Resolution No. 2023-08 - CalRecycle Beverage Container Program
RESOLUTION NO. 2023-08
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF LOS ALAMITOS, CALIFORNIA, APPROVING THE
CITY’S PARTICIPATION IN CALRECYLE’S BEVERAGE
CONTAINER RECYCLING CITY/COUNTY PROGRAM
DISTRIBUTION INTENDED TO AID ACHIEVING AND
SUSTAINING HIGH RECYLING RATES
WHEREAS, pursuant to Public Resources Code sections 48000 et seq., 14581, and 42023.1(g), the Department of Resources Recycling and Recovery (CalRecycle) has established various payment programs to make payments to qualifying jurisdictions; and,
WHEREAS, in furtherance of this authority CalRecycle is required to establish procedures governing the administration of the payment programs; and, WHEREAS, CalRecycle’s procedures for administering payment programs require, among other things, an applicant’s governing body to declare by resolution certain authorizations related to the administration of the payment program.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, DOES RESOLVE AS FOLLOWS:
SECTION 1. The City Council of the City of Los Alamitos, California, finds that the above recitals are true and correct.
SECTION 2. Any and all funding awards made through the Beverage Container Recycling City/County Payment Program distributed by the California Department of Resources Recycling and Recovery (CalRecycle) are hereby accepted, and staff is directed to submit an application requesting these funds, to CalRecycle.
SECTION 3. The City Manager and/or his/her designee(s) is hereby authorized to execute on behalf of the City of Los Alamitos the applications, the Standard Agreements, any amendments, and all other documents required by the Beverage Container Recycling City/County Payment Program for disbursement of funding pertaining to Fiscal Year (FY) 2022-2023.
SECTION 4. The authorizations set forth herein shall remain valid until rescinded by resolution of the City Council of the City of Los Alamitos, California.
SECTION 5. The City Clerk shall certify as to the adoption of this Resolution.
PASSED, APPROVED, AND ADOPTED this 21st day of February 2023. ___________________________
Tanya Doby, Mayor
CC RESO 2023-08
ATTEST:
_______________________________
Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:
_______________________________
Michael S. Daudt, City Attorney
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a regular meeting of the City Council held on the 21st day of February 2023, by the following vote, to wit:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
ABSTAIN: COUNCILMEMBERS:
_________________________________
Windmera Quintanar, MMC, City Clerk
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: February 21, 2023 ITEM NUMBER: 10L
To: Mayor Tanya Doby & Members of the City Council
Presented By: Ron Noda, Development Services Director
Subject: Notice of Completion (NOC) for the Installation of Catch Basin CPS (Connector Pipe Screens) Citywide Project (CIP No. 21/22-05)
SUMMARY
This capital improvement project installed Connector Pipe Screen (CPS) trash collecting units within 101 catch basins citywide. These CPS units are screens that are mounted at the outlet pipe of the catch basin to collect trash for disposal before entering the storm drain and eventually discharging into the ocean waters. This full-capture system was installed in existing catch basins as a requirement of the State Water Quality Control Board.
Staff recommends Council accept the work as completed, direct filing of the Notice of Completion (NOC), and authorize retention release as prescribed by the Public Contract Code.
RECOMMENDATION
1. Accept as complete the construction by United Stormwater, Inc. for the Installation of Catch Basin CPS (Connector Pipe Screens) Citywide Project (CIP No. 21/22-05); and,
2. Direct the City Clerk to record the Notice of Completion/Final Report with the County Recorder’s Office; and,
3. Authorize Staff to release the 5% retention to the contractor, in the amount of $4,129.92, thirty-five (35) days after recordation of the Notice of Completion.
BACKGROUND
The City of Los Alamitos' storm drain system is directly connected to the Los Alamitos Channel, which then drains into the San Gabriel River. The Connector Pipe Screens (CPS) will give the City the opportunity to continue to reduce the transportation related pollution that enters receiving water and impacts Orange County's surface and groundwater system, specifically on high-traffic streets such as Katella Avenue and Los Alamitos Boulevard.
Connector Pipe Screen (CPS) is a form of catch basin protection that primarily targets trash and debris larger than 5mm in size. The CPS is inserted into selected catch basins and mounted in front of the basin's outlet pipe using a pre-installed bracketing system. CPS units are preconfigured in compliance with the basin size and outlet pipe locations. Once installed, connector pipe screens retain large volumes of trash and sediment inside the catch basin instead of the debris being conveyed through the storm water system. Debris the size of cigarette butts and larger is stored inside of the catch basin and regularly removed by the
Public Works Division.
The plans and specifications for the installation of Catch Basin CPS (Connector Pipe Screens) Citywide Project (CIP No. 21/22-05) were approved by Council on 02/28/2022. The City Council approved the Award of Bid to United Stormwater, Inc. on 04/18/2022. The work consisted of installing CPS units inside the 101 catch basins in Los Alamitos.
The installation of the proposed CPS units will be an instrumental benefit as a water protection device and cover a drainage area of approximately 1.87 square miles. This project will be updated in the OCTA database and shown within the City’s 7-year CIP plan.
DISCUSSION
Work on this project is now complete and found acceptable by the City Engineer. Staff recommends acceptance of the work in conjunction with the processing of the Notice of Completion/Final Report and release of the retention as prescribed by the Public Contracts Codes.
FISCAL IMPACT
The project had a total funding budget of $99,404 with the following breakdown of funding sources:
Budget Fiscal
Year
Source Amount
2021-22 Tier -1 OCTA Grant $51,524
2021-22 General Fund - Match $12,880
2021-22 Additional General Fund $35,000
Project Total $99,404
The project was within the overall funding budget of $99,404 and came in at $82,598.44, which included one change order to jet blast a section of storm drains and remove debris in (3) of the catch basins in order to successfully install the devices. Upon field inspection during construction, it was determined that 18 of the 119 city catch basins did not warrant a CPS unit to be installed due to size restrictions and thus creating a cost savings.
Attachment: 1. NOC CIP 21/22-05
RECORDING REQUESTED BY
AND MAIL TO:
City Clerk
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720
No Consideration SPACE ABOVE THIS LINE FOR RECORDER
NOTICE OF COMPLETION NO RECORDING FEE PURSUANT TO
GOVERNMENT CODE SECTION 6103
for
Los Alamitos Catch Basin CPS (Connector Pipe Screen) Citywide Project (CIP No. 21/22-05) NOTICE IS HEREBY GIVEN THAT:
1. The undersigned are owners or corporate officers of the interest or estates stated below in property hereinafter described.
2. The full name of the owner is: City of Los Alamitos, 3191 Katella Avenue, Los Alamitos, CA 90720
3. The work consisted of :
The City of Los Alamitos hired a contractor for the fabrication and installation of storm water protection devices referred to as Connector Pipe Screen (CPS) units which were installed in the City's existing catch basins. This project installed these trash screens in the City’s existing catch basins as a requirement of the State Water Quality Control Board for trash collection.
4. The work was completed on___11/14/2022______
5. The contractor was: United Stormwater, Inc.
Dated _____02/07/2023______________________ __________________________________________ Chris Kelley, City Engineer, City of Los Alamitos
VERIFICATION BY CORPORATION OWNER
STATE OF CALIFORNIA )
) SS
COUNTY OF ORANGE )
I, Chris Kelley, City Engineer of Los Alamitos, a Municipal Corporation, and that he executed the foregoing Notice of the aforesaid interest or estates in the property therein described; and verify on behalf of the City of Los Alamitos; that the contents thereof, and the the facts therein stated are true.
____________________________________________________
Chris Kelley, City Engineer
Dated: __________________
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: February 21, 2023 ITEM NUMBER: 10M
To: Mayor Tanya Doby & Members of the City Council
Presented By: Michael Daudt, City Attorney
Subject: Resolution No. 2023-04 - Notice of Intent to Overrule the Airport Land Use Commission (ALUC) for Orange County Finding of Housing Element Inconsistency
SUMMARY
On January 19, 2022, the Orange County Airport Land Use Commission (“ALUC”) reviewed the City’s General Plan Housing Element Update 2021-2029 6th Cycle and found the Housing Element Update to be inconsistent with the Airport Environs Land Use Plan for the Joint Forces Training Base Los Alamitos. The City Council will consider initiating the two-step process to overrule the ALUC determination in accordance with State Law.
RECOMMENDATION
1. Adopt Resolution No. 2023-04 entitled, "A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF LOS ALAMITOS, CALIFORNIA, MAKING DRAFT FINDINGS AND NOTIFYING THE
ORANGE COUNTY AIRPORT LAND USE COMMISSION AND THE STATE DIVISION OF AERONAUTICS OF THE CITY'S INTENTION TO FIND THAT THE GENERAL PLAN 2021- 2029 HOUSING ELEMENT UPDATE IS CONSISTENT WITH THE PURPOSES OF THE
STATE AERONAUTICS ACT AND OVERRULE THE ORANGE COUNTY AIRPORT LAND
USE COMMISSION'S DETERMINATION THAT THE HOUSING ELEMENT IS INCONSISTENT WITH THE 2017 JOINT FORCES TRAINING BASE LOS ALAMITOS AIRPORT ENVIRONS LAND USE PLAN” and,
2.Authorize the City Manager to submit Resolution No. 2023-04 to the Orange County Airport Land Use Commission and the State Division of Aeronautics and schedule a public hearing pursuant to Public Utilities Code Section 21676.
BACKGROUND
The Orange County Airport Land Use Commission (“ALUC”) is an advisory committee established by State Law. (Public Utilities Code §§ 21670 et seq.). The ALUC is intended to assist local agencies in ensuring compatible land uses in the vicinity of civilian and military airports. This is done primarily through their adoption of a land use compatibility plan, known as the Airport Environs Land Use Plan (“AELUP”) for the Joint Forces Training Base Los Alamitos (“JFTB”), against which land use and planning proposals are compared and evaluated for consistency. The AELUP includes a variety of information designed to help development surrounding the JFTB be compatible with the airport use, including heights, noise, and general safety.
Public Utilities Code (“PUC”) Section 21676(b) requires the City to submit General Plans and General Plan amendments to the ALUC for a consistency determination. On December 14, 2023, following a duly noticed public hearing, the Planning Commission voted to recommend City Council approval of the General Plan Housing Element Update 2021-2029 6th Cycle (“Housing Element Update”). Thereafter, City staff submitted the Housing Element Update to ALUC for a consistency determination.
DISCUSSION
ALUC Determination
The ALUC reviewed the proposed Housing Element Update on January 19, 2022. A copy of the ALUC agenda report is included as Attachment 1. City staff attended the meeting, and answered questions from the ALUC commissioners, primarily related to the potential housing sites identified at 4655 Lampson Avenue (Site 6) and 5030-5084 Katella (Site 10). After review and discussion, the ALUC voted 5-1 to find the Housing Element Update inconsistent with the AELUP based on noise, safety, and general concerns of land use incompatibility with the ALUC’s purposes and responsibilities, which are more broadly described below. The ALUC’s determination letter is included as Attachment 2.
Aircraft Noise Impacts
The AELUP uses the Community Noise Equivalent Level (CNEL) system for measuring noise impacts, which is a weighted average of noise over time. The potential housing sites identified at 4655 Lampson Avenue (Site 6) and 5030-5084 Katella (Site 10) are within the 60-65 dBA CNEL noise contour. The AELUP defines the noise exposure in the 60-65 dBA CNEL noise contour (Noise Impact Zone 2) as “Moderate Noise Impact” and in the 65-70 dBA CNEL noise contour (Noise Impact Zone 1) as “High Impact.” (AELUP Sections 3.2.3, 3.2.4.) Residential uses are identified as “conditionally consistent” for the 60-65 dBA CNEL noise contour and “normally inconsistent” for the 65-70 dBA CNEL noise contour (AELUP Section 3, Table 1 “Limitations on Land Use Due to Noise”). The City’s established policy is that residential units are not to be approved within the 65-70 dBA CNEL noise contour of the airport (Growth Management Element, Policy 3.5). Therefore, the City’s policy and the AELUP are consistent, and allow development of residential units in the 60-65 dBA CNEL noise contour. In addition, the AELUP states residential uses in the 60-65 dBA CNEL noise contour must use sound attenuation to ensure that the interior CNEL value does not exceed 45 dBA. This requirement is consistent with the California Building Code requirements enforced by the City to ensure that interior noise levels do not exceed 45 dBA. Furthermore, the General Plan Growth Management Element Policy 3.7 requires a notice of airport be included as part of the Deed Disclosure Notice for any residential development proposed within the 60 dBA CNEL noise contour for the JFTB, which is consistent with the AELUP.
Safety
AELUP Section 2.1.2 (Safety) describes accident potential zones and clear zones at the JFTB.
Accident potential and clear zones were set in 1994 and based on Department of Defense criteria. Prior to 1995, the ALUC utilized a 10-year accident history which found that the accident potential zone was located completely within the boundaries of JFTB, and no
additional accident potential zones are identified beyond the clear zones. No development is proposed by the Housing Element Update within the clear zones. The potential housing site identified as Laurel Park is not adjacent to the north departure path; it is located 1 mile northwest of the north end of the north departure runway and will not be impacted by noise or by aircraft operations.
Overrule Process
As a final review authority on legislative acts, the City Council may choose to overrule the ALUC's determination by following a two-step process, which is set forth in PUC Sections 21676 and 21676.5. The first step in the process is to adopt a resolution of intention to overrule, a copy of which would be sent to the ALUC and the Division of Aeronautics of the Department of Transportation to provide formal notification of the City's intent. A decision on overruling the ALUC cannot take place less than forty-five (45) days after notice of the City Council’s proposed action. The ALUC and Division of Aeronautics may provide comments to the City Council within 30 days of receiving the resolution of intention.
If comments from the ALUC and/or the Division of Aeronautics are not made available within this time frame, the City Council may act without them. Any comments by the ALUC and Division of Aeronautics are advisory to the Council and must be included in the public record of any final decision by the City Council to overrule the ALUC’s determination.
The second step in the process is that, not less than 45-days after notification has been sent to the ALUC and Division of Aeronautics, the City Council must conduct a public hearing, after which the City Council may decide whether to adopt a resolution to overrule the ALUC and make specific findings that the Housing Element Update is consistent with the purposes of the State Aeronautics Act, as set forth in PUC Section 21670.
If the City Council fails to overrule the ALUC’s inconsistency determination based on specific findings or fails to revise the Housing Element in accordance with the ALUC comments, then the ALUC may, pursuant to PUC Section 21676.5(a), require the City to submit all subsequent actions, regulations, and permits to the ALUC for review until the City overrules the determination or revises the Housing Element. If the ALUC then finds that an action, regulation, or permit is inconsistent with the AELUP, the City must then hold a hearing to reconsider. The City may then go through a similar overrule process.
However, under PUC Section 21676.5(b), if the City Council has overruled the ALUC or revised its Housing Element, the proposed action of the City shall not be subject to further ALUC review, unless the ALUC and the City agree that individual projects shall be reviewed by the ALUC.
The attached resolution notifies the ALUC and the Division of Aeronautics of the City's intent to conduct a public hearing and consider whether to adopt a resolution overruling the ALUC inconsistency determination. If the resolution of intention is adopted, the City Council would conduct the public hearing at a later date, at which time the City Council would consider all comments received, including from the ALUC and the Division of Aeronautics, and then make a decision. The resolution to overrule the ALUC at the future hearing must be adopted by a two-thirds vote of the City Council.
FISCAL IMPACT
None.
Attachment: 1. Resolution No. 2023-06 - Notice of Intent to Overrule ALUC
2. ALUC Agenda Item 1_Jan 19, 2022
3. Housing Element ALUC Determination Letter (002)
CC RESO 2023-04
1752784.1
RESOLUTION NO. 2023-04
A RESOLUTION OF CITY COUNCIL OF THE CITY OF
LOS ALAMITOS, CALIFORNIA, MAKING DRAFT
FINDINGS AND NOTIFYING THE ORANGE COUNTY
AIRPORT LAND USE COMMISSION AND THE STATE
DIVISION OF AERONAUTICS OF THE CITY’S
INTENTION TO FIND THAT THE GENERAL PLAN 2021-
2029 HOUSING ELEMENT UPDATE IS CONSISTENT
WITH THE PURPOSES OF THE STATE AERONAUTICS
ACT AND OVERRULE THE ORANGE COUNTY
AIRPORT LAND USE COMMISSION’S
DETERMINATION THAT THE HOUSING ELEMENT IS
INCONSISTENT WITH THE 2017 JOINT FORCES
TRAINING BASE LOS ALAMITOS AIRPORT ENVIRONS
LAND USE PLAN
WHEREAS, the State Housing Element Law, Article 10.6 of the California Government Code (Sections 65580 et seq.) requires each local jurisdiction to update its General Plan Housing Element every eight (8) years to reflect new statutory requirements and accommodate its share of the Regional Housing Needs Assessment Allocation (RHNA); and,
WHEREAS, the City of Los Alamitos prepared General Plan Amendment 21-01, an update to the Housing Element for the 2021-2029 period in accordance with the guidelines and requirements of State Housing Element Law (the “Housing Element Update”); and,
WHEREAS, on December 14, 2022, the Planning Commission conducted a duly noticed public hearing and recommended to the City Council the adoption of the Housing Element Update; and,
WHEREAS, in accordance with Public Utilities Code Section 21676(b), the City referred the Housing Element Update to the Orange County Airport Land Use Commission (“ALUC”) to review for consistency with the 2017 Joint Forces Training Base Los Alamitos Airport Environs Land Use Plan (“AELUP”); and, WHEREAS, on January 19, 2022, the ALUC, acting pursuant to Public Utilities Code Section 21670, determined that the Housing Element Update is inconsistent with the AELUP; and,
WHEREAS, as the final review authority under Public Utilities Code Sections 21670 and 21676, the City Council may, after a public hearing, overrule the ALUC by a two-thirds vote, if it makes specific findings that the Housing Element Update is consistent with the purposes of Public Utilities Code Section
CC RESO 2023-04
1752784.1
21670 regarding the protection of the public health, safety, and welfare by ensuring the orderly expansion of airports and the adoption of land use measures that minimize the public's exposure to excessive noise and safety hazards within areas around public airports to the extent that these areas are not already devoted to incompatible uses; and by providing the ALUC and the Division of Aeronautics of the California Department of Transportation (“Division”) with notice of the City’s intent to consider overruling the ALUC determination along with specific findings at least 45 days prior to the City’s action to overrule the ALUC; and, WHEREAS, the Public Utilities Code provides that the ALUC and the Division shall respond to the notification of the findings of proposed overrule within 30 days of receiving the proposed resolution and findings; and, WHEREAS, in the event the ALUC or Division’s comments are not available within this timeframe, the City may act without them; and, WHEREAS, the comments by the ALUC and Division are advisory to the City under state law; and,
WHEREAS, the City Council shall include any comments from the ALUC and the Division in the final record of any final decision by the City Council to overrule the ALUC, which may only be adopted by a two-thirds vote of the City Council; and,
WHEREAS, the draft findings set forth in Section 2 of this resolution do not constitute the final findings of the City with regard to the Housing Element Update’s consistency with the purposes of Public Utilities Code Section 21670 and such draft findings may be revised, amended, and/or supplemented as part of any final decision to overrule the ALUC’s determination; and,
WHEREAS, should the City Council adopt this resolution making the draft findings and declaring its intent to consider overruling the ALUC determination that the Housing Element Update is inconsistent with the AELUP and directing staff to transmit the required notice to the ALUC and the Division, a public hearing will be required in order for the City Council to make a final decision whether to overrule the ALUC inconsistency determination.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS
ALAMITOS DOES RESOLVE AS FOLLOWS:
SECTION 1. The City Council finds that the above recitals are true and correct.
SECTION 2. The City Council declares its intent to conduct a public hearing and its intent to consider overruling the ALUC’s determination that the Housing Element Update is inconsistent with the AELUP based on the following draft findings:
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a. The 2017 Joint Forces Training Base Los Alamitos Airport Environs Land Use Plan (“AELUP”) of the Orange County Airport Land Use Commission (“ALUC”) guides the orderly development of the Joint Forces Training Base Los Alamitos (“JFTB”) and the surrounding area through implementation of the standards in AELUP Section 2 (Planning Guidelines) and Section 3 (Land Use Policies). Implementation of these standards is intended to protect the public from the adverse effects of aircraft noise, ensure that people and facilities are not concentrated in areas susceptible to aircraft accidents, and ensure no structures or activities adversely affect navigable airspace.
b. AELUP Section 2.1.1 sets forth the Community Noise Equivalent Level (“CNEL”) standards. The Housing Element Update includes the identification of two (2) opportunity sites within the 60 dB CNEL contour for JFTB. No Housing Element Update opportunity sites are within the 65 dB CNEL noise contour.
c. Sections 3.2.3 and 3.2.4, respectively, of the AELUP define the noise exposure in the 60-65 dBA CNEL noise contour (Noise lmpact Zone 2) as “Moderate Noise lmpact” and in the 65-70 dBA CNEL noise contour (Noise lmpact Zone 1) as “High lmpact.” Section 3, Table 1 (Limitations on Land Use Due to Noise) of the AELUP identifies residential as “conditionally consistent” with the 60-65 dBA CNEL noise contour and “normally inconsistent” with the 65-70 dBA CNEL noise contour. The City’s established policy is that residential units are not to be approved within the 65-70 dBA CNEL noise contour of the airport (Growth Management Element, Policy 3.5). Therefore, the City’s policy and the AELUP are consistent, and allow development of residential units in the 60-65 dBA CNEL noise contour. In addition, the AELUP states residential uses in the 60-65 dBA CNEL noise contour must use sound attenuation to ensure that the interior CNEL value does not exceed 45 dBA. This requirement is consistent with the California Building Code requirements enforced by the City to ensure that interior noise levels do not exceed 45 dBA. Furthermore, the General Plan Growth Management Element Policy 3.7 requires a notice of airport be included as part of the Deed Disclosure Notice for any residential development proposed within the 60 dBA CNEL noise contour for the JFTB, which is consistent with the AELUP.
d. The AELUP Section 2.1.2 (Safety) sets forth zones identified as accident potential zones and clear zones. No Housing Element Update opportunity sites are located within these identified areas. The opportunity site identified as Laurel Park is not adjacent to the north departure path; it is located 1 mile northwest of the north end of the north departure runway and will not be impacted by noise or by aircraft operations.
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e. The Housing Element Update is consistent with the purpose and intent of the AELUP and will not result in incompatible land uses adjacent to the JFTB. The standards and policies set forth in Sections 2 (Planning Guidelines) and 3 (Land Use Policies) of the AELUP were adopted to prevent the creation of new noise and safety problems. As set forth above, any development on the proposed Housing Element Update opportunity sites will comply with the noise criteria and safety standards established in Sections 2 and 3 of the AELUP.
SECTION 3. The City Council hereby directs City staff to provide notice, in accordance with Sections 21676(b) and 21676.5(a) of the Public Utilities Code, to the ALUC and Caltrans Department of Transportation, Division of Aeronautics, of the City’s intent to overrule the ALUC’s determination of inconsistency for the Housing Element Update based on the above findings, at least 45 days prior to the scheduled public hearing date for consideration of the proposed overruling action by the City Council.
SECTION 4. The City Council hereby further directs City staff to take all other actions necessary to effectuate the purpose and intent of this resolution.
SECTION 5. The City Council finds the adoption of this resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Specifically, the resolution does not have the potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment because it is limited to the City's proposal to overrule the ALUC's determination. The Housing Element Update has been independently reviewed and evaluated pursuant to CEQA.
SECTION 6. The City Clerk shall certify as to the adoption of this Resolution.
PASSED, APPROVED, AND ADOPTED this 21st day of February 2023. ________________________________
Tanya Doby, Mayor
ATTEST:
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______________________________
Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:
_______________________________
Michael S. Daudt, City Attorney
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a regular meeting of the City Council held on the 21st day of February, 2023, by the following vote, to wit:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
ABSTAIN: COUNCILMEMBERS:
________________________________________
Windmera Quintanar, MMC, City Clerk
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: February 21, 2023 ITEM NUMBER: 11A
To: Mayor Tanya Doby & Members of the City Council
Presented By: Chelsi Wilson, Administrative Services Manager Subject: Non-Represented Employees Agreement Amendment
SUMMARY
This report seeks approval for two changes to the Non-Represented Agreement.
RECOMMENDATION
Adopt Resolution No.2023-09, entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF LOS ALAMITOS, CALIFORNIA, ESTABLISHING SALARIES AND BENEFITS FOR NON-REPRESENTED EMPLOYEES AND REPEALING RESOLUTION NUMBERS 2021-25, 2022-07 AND 2022-24 IN THEIR ENTIRETY."
BACKGROUND
The following outlines the two changes to the Non-Represented Employees Agreement that are recommended:
1. Annual Vacation Payoff, adding 80 hours
2. City Vehicle for Support Services Manager with all variable expenses
DISCUSSION
The Non-Represented Agreement requires some clean up to formally adopt current practices.
SECTION 6 (G) – ANNUAL VACATION PAYOFF
Section 6(G) shall be amended and restated as follows:
Employees may receive pay for up to one hundred sixty (160) hours of accumulated vacation time during each calendar year provided they have used a minimum of eighty (80) vacation hours during the previous calendar year. Employees not using at least 80 hours of vacation during the previous calendar year may receive vacation payoff if such payoff is recommended by the Department Director and approved by the City Manager.
SECTION 26 (B) – MILEAGE REIMBUSEMENT AND CAR ALLOWANCE Section 26(B) shall be amended and restated as follows:
Police Chief, Police Captains, and Support Services Manager. The Police Chief, Police
Captains, and Support Services Manager shall be provided with a City vehicle for personal and business use within the State of California. The City shall provide and include all variable costs and expenses of the vehicle, including registration, license fees, insurance, maintenance, fuel, and repairs.
FISCAL IMPACT
The fiscal impact associated with the various changes that are recommended is incorporated in the 2022/2023 Approved Budget.
Attachment: 1. Resolution No. 2023-09 - Non-Represented Employees
2. Exhibit A
RESOLUTION NO. 2023-09
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
LOS ALAMITOS, CALIFORNIA, ESTABLISHING SALARIES AND
BENEFITS FOR NON-REPRESENTED EMPLOYEES AND
REPEALING RESOLUTION NUMBERS 2021-25, 2022-07 and
2022-24 IN THEIR ENTIRETY
WHEREAS, the City of Los Alamitos desires to promote improved employeremployee relations between the City of Los Alamitos and its employees by establishing and presenting the rights and benefits of the employees and the City of Los Alamitos.
WHEREAS, on November 15, 2021, the City Council adopted Resolution 2021-25 establishing the salaries and benefits for Non-Represented Employees (the “Salary and Benefit Resoluton for Non-Represented Employees”); and, WHEREAS, on February 28, 2022 the City Council adopted Resolution 2022-07 amending the Salary and Benefit Resolution for Non-Represented Employees to add a Finance Manager position to Middle Management; and,
WHEREAS, on July 18, 2022 the City Council adopted Resolution 2022-24 amending the Salary and Benefit Resolution for Non-Represented Employees to include an Economic Development Supervisor position to Confidential Employees; and, WHEREAS, the City of Los Alamitos seeks to amend the salary schedules and health benefit contributions for Executive Management and Non-Represented employees; and,
WHEREAS, the changes to the agreement and salary schedules become effective January 23, 2023.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. Title of Resolution. This Resolution shall be known as the Salary and Benefit Resolution for Non-Represented Employees of the City of Los Alamitos.
SECTION 2. Statement of Purpose. Employer and Non-Represented Employee Relations. This Resolution is adopted to provide reasonable and orderly procedures for the administration of employer-employee relations between the City and its nonrepresented employees.
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SECTION 3. Definitions.
A. CITY: The City of Los Alamitos, a municipal corporation, and where appropriate herein, "City" refers to the City Council, the governing body of said City, or any duly authorized representative of the City of Los Alamitos.
B. DAYS: Calendar days, unless otherwise stated.
C. EMPLOYEE OR NON-REPRESENTED EMPLOYEE: Except as otherwise specified in this Resolution, any person regularly employed by the City of Los Alamitos in one or more full-time positions of Executive Management, Middle Management or Confidential Employees.
1. Executive Management employees are the following positions: City Clerk/Director of Communications, City Clerk, Administrative Services Director, Administrative Services Manager, Police Chief, Development Services Director, Recreation and Community Services Director, Assistant City Manager, and City Manager.
2. Middle Management employees are the following positions: Recreation Manager, Development Services Manager, Police Captain, Public Services Superintendent, Support Services Manager, Finance Manager.
3. Confidential employees are the following positions: Public Works Supervisor, Recreation Supervisor, Assistant to the City Manager, Deputy City Clerk, Benefits Coordinator/Executive Assistant, and Economic Development Supervisor.
SECTION 4. City Responsibilities and Rights.
Rights Enumerated. Nothing herein shall be construed to restrict any legal or inherent exclusive City rights with respect to matters of general legislative or managerial policy.
Except as otherwise specifically provided in this Resolution, or amendments or revisions thereto, the City has and retains the sole and exclusive rights and functions of management, including, but not limited to, the following:
A. To determine the merits, necessity, nature or extent of services to be performed, as well as the right to determine and implement its public function and responsibility, and the mission of its constituent departments, commissions and boards.
B. To set standards of service and manage all facilities and operations of the City, including the methods, means and personnel by which the City's operations are to be conducted.
C. To schedule working hours, allot, and assign work.
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D. To establish, modify, or change work schedules or standards.
E. To direct the working forces, including the right to hire, promote, demote or transfer any employee, and determine the procedures and standards of selection for employment.
F. To determine the location of all plants and facilities.
G. To determine the layout and the machinery, equipment, or materials to be used.
H. To determine processes, techniques, methods and means of all operations, including changes or adjustments of any machinery or equipment.
I. To determine the size and composition of the working force.
J. To determine the policy and procedure affecting the selection or training of new employees.
K. To establish, assess and implement employee performance standards, including, but not limited to, quality and quantity standards, the assessment of employee performance, and the procedures for said assessment.
L. To control and determine the use of City's property, material, machinery, and equipment.
M. To schedule the operation of and to determine the number and duration of shifts.
N. To determine measures to promote safety and to protect health and property and take all necessary actions to carry out its mission in emergencies.
O. To transfer work from one job to another or from one plant or unit to another.
P. To introduce new, improved or different methods of operations, or to change existing methods.
Q. To relieve employees from duty for lack of work or for other reasons deemed legitimate by management.
R. To reprimand, suspend, demote, reduce in pay, discharge or otherwise discipline employees for cause. The judgment of management shall govern except for an abuse of discretion.
S. To establish and determine job classifications.
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T. To contract or subcontract work with outside public or private entities and maintain the efficiency of governmental operations.
U. To take such other and further action as may be necessary to organize and operate the City in the most efficient and economical manner for the best interest of the public it serves.
V. To terminate at-will employees with or without cause or notice, and without right of appeal or hearing.
SECTION 5. Salary Ranges.
A. The salary steps and ranges of all classifications governed by this Resolution shall be as specified in Exhibits A1, A2, and A3 attached hereto and incorporated by reference.
B. Market Adjustment Policy: In order to retain high-performing employees, promote excellent job performance, recruit competitively, but remain fiscally prudent, the City Manager is authorized to adjust the steps and ranges in Exhibits A1, A2, and A3 for management employees position-by-position based upon performance, as follows:
1. The City Manager may conduct salary surveys from time to time with respect to some or all of the non-represented employees’ positions and to adjust steps and ranges, within the parameters stated in this section, based on performance and market conditions.
2. The surveyed cities shall, at a minimum, include those in Orange County with populations of less than 30,000 and the immediately adjacent cities of Cypress and Seal Beach.
3. Adjusted compensation may not exceed the compensation provided to the lowest top-step of a comparable position in Orange County according to the survey.
4. All compensation adjustments must be within the Council-approved budget.
SECTION 6. Vacation.
A. Purpose. The purpose of annual vacation is to enable eligible employees to take time off to provide a break from their work-related duties and responsibilities and to return to work refreshed.
B. Basis of Accrual. New employees shall begin accrual of vacation leave effective their first day of employment. New employees shall not be allowed to take vacation leave until six months of continuous full-time service. Vacation leave shall accrue to employees on a bi-weekly basis at a pro-rated amount equivalent to the annual amounts specified below. No employee may accumulate more than three hundred (300) hours of vacation leave. When an employee’s accumulated vacation leave
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balance reaches three hundred (300) hours, that employee shall not accrue any further vacation leave until such time as the employee’s accumulated vacation leave balance is reduced below three hundred (300) hours. In order to promote recruiting and retention efforts, the City Manager shall have the discretion to modify this schedule for an individual employee at the time of hire or promotion when he or she determines it to be in the best interests of the City.
Annual vacation leave accrual for employees hired before August 1, 1987 shall be limited as follows:
Years of Service Hours
0-3 120
4 128
5 136
6-10 144
11 152
12 160
13 168
14 176
15 184
16 192
17 and over 200
Annual vacation leave accrual for employees hired on or after August 1, 1987, shall be limited as follows:
Years of Service Hours
0-2 80
3 88
4 96
5 104
6 112
7 120
8 128
9 136
10 144
11 152
12 160
13 168
14 and over 176
C. Effect of Holiday(s) on Vacation Leave. In the event one or more municipal holidays fall within an annual vacation leave, such holiday shall not be charged as vacation leave, but may be credited as a holiday.
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D. Effect of Leave of Absence on Accrual of Vacation Leave. The granting of any leave of absence without pay shall cause the accrual of vacation leave to cease.
Upon return to the City, an employee shall resume his or her regular accrual of vacation leave. A leave of absence without pay shall not count towards years of service for the accrual of vacation leave.
E. Compensation for City Work During Vacation Prohibited. No person shall be permitted to work for compensation for the City in any capacity during the time of his or her vacation leave from City service. This clause shall not limit the City's right to recall an employee from vacation leave in the event of an emergency and place him or her on regular pay status.
F. Scheduling Vacations. The times during a calendar year at which an employee may take his or her vacation leave shall be determined by the Department Director or the City Manager when the employee is a Department Director, with due regard for the wishes of the employee and particular regard for the needs of service.
G. Annual Vacation Payoff. Employees may receive pay for up to one hundred sixty (160) hours of accumulated vacation time during each calendar year provided they have used a minimum of eighty (80) vacation hours during the previous calendar year. Employees not using at least 80 hours of vacation during the previous calendar year may receive vacation payoff if such payoff is recommended by the Department Director and approved by the City Manager.
H. Vacation Payoff Upon Termination. Upon termination of employment, the employee shall be paid in a lump sum for all accumulated vacation leave time at the rate of pay in effect upon termination.
SECTION 7. Sick Leave.
A. Accrual and Use of Sick Leave. Sick leave with pay shall accrue at the rate of eight (8) hours for each calendar month of service. Accumulation shall be unlimited. Pursuant to Government Code Section 21163, sick leave shall only be granted for non-industrial injury or illness and shall be allowed if: (1) actual nonindustrial illness or disability makes it impossible for the employee to perform his or her normal work assignments; (2) because of the illness of the employee’s spouse or dependent child who requires constant care and no other care is available and/or financially feasible except that of the employee; or (3) a prescheduled doctor, dental or optometry appointment which has been approved by their Department Director.
B. Proof of Illness. In order to receive compensation while absent on sick leave, the employee shall notify his or her immediate supervisor thirty (30) minutes prior to the time set for beginning his or her daily duties, or as may be specified by the employee’s supervisor. The employee may be required to file a physician's certificate justifying the need for any absence. Proof of violation of sick leave
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privileges may result in disciplinary action and/or loss of pay when in the opinion of the City Manager the employee has abused such privileges. Employees on approved Family Medical Leave for intermittent illness or injuries shall not be required to show proof of illness for each instance of sick leave usage.
C. Effect of Holidays on Sick Leave. Observed holidays occurring during sick leave shall not count as a day of sick time.
D. Annual Sick Leave Payoff. An employee shall be allowed to accumulate sick leave from year to year. In December, upon the written request of the employee, the City shall compensate the employee for either (1) up to 25% of his or her current year’s unused sick leave, or (2) up to twenty-four (24) hours of accumulated sick leave, provided that in either case a minimum of 480 hours remains in the employee's account.
E. Regular Service Retirement Sick Leave Options. Upon a regular service retirement as defined by the Public Employees Retirement System, an employee may receive compensation for accumulated sick leave under either of the following two options:
1. A lump sum payment of 25% of the first 720 hours of accumulated sick leave and 50% of the hours between 720 and 1,040. There will be no compensation for any hours in excess of 1,040 under this option. Said sum shall be based on the employee’s salary rate being paid at the time of the employee’s service retirement.
2. If allowed by CalPERS, an exchange of all accumulated sick leave for service credit time in the Public Employees Retirement System.
An employee must choose option 1 or 2. An employee will not be allowed to do both.
F. Family Member Illness. Each calendar year, an employee may use up to one-half (1/2) of annual sick leave accrual to attend to the illness of a parent, child, spouse or registered domestic partner of the employee.
SECTION 8. Bereavement Leave. Whenever an employee is compelled to be absent from duty by reason of death or critical illness (where death appears imminent) of members of the employee's immediate family (father, mother, brother, sister, spouse, children, mother-in-law, father-in-law, grandmother, grandfather, or grandchildren) said employee shall be entitled to a leave of absence with pay for a period not to exceed twenty-four (24) working hours. Bereavement Leave in excess of twenty-four (24) working hours may be granted at the sole discretion of the City Manager for employees who must travel out of state to attend a funeral covered under this provision. Where such death or critical illness has occurred, the employee shall furnish satisfactory evidence of such death or illness to his or her Department Director. Such leave of absence shall not
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be allowed in any case where in the preceding six (6) calendar months a leave on the grounds of critical illness of that same relative has been granted. Bereavement leave shall not be charged against sick leave.
SECTION 9. Temporary Disability Leave.
A. Industrial Related Disability. Employees shall be entitled to the benefits under this subsection only after the City has determined that the disability is industrial related. If an employee is injured on the job to such an extent that temporary industrially related disability leave is necessary, the employee’s salary shall be continued at the full rate of pay for a period up to thirty (30) calendar days with no charge to sick leave. After thirty (30) calendar days, the employee may utilize accrued vacation leave, sick leave and compensatory time off to supplement the benefits received pursuant to worker’s compensation laws to provide for full salary maintenance during the period of temporary industrially related disability.
Further disability leave benefits and requirements shall be provided as set forth in the City of Los Alamitos' Family Care and Medical Leave Policy.
If leave without pay is utilized, no accruals of sick leave, vacation leave, other benefits or seniority will be credited to the employee. The employee shall not forfeit any of the benefits or seniority accumulated prior to the commencement of the leave without pay.
B. Non-Industrial Related Disability. Upon submission of a certificate from a licensed physician indicating that an employee shall be placed on temporary disability leave for a non-industrially-related disability, the employee shall be entitled to nonindustrially related temporary disability leave. The employee utilizing nonindustrially related temporary disability leave may utilize all accumulated sick leave, vacation leave and compensatory time off. When the employee is not using accumulated sick leave, vacation leave and compensatory time off, the absence will be on the basis of leave without pay.
Further disability leave benefits and requirements shall be provided as set forth in the City of Los Alamitos' Family Care and Medical Leave Policy.
If leave without pay is utilized, no accruals of sick leave, vacation leave, other benefits or seniority will be credited to the employee. The employee shall not forfeit any of the benefits or seniority accumulated prior to the commencement of the leave without pay.
SECTION 10. Employee Contracts. In order to be eligible for the benefits provided for under this Resolution and prior to receipt of such benefits, each Executive Management employee must execute an employment agreement in a form approved by the City Council, City Manager, and City Attorney.
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SECTION 11. Labor Code Section 4850 Disability Benefits For Safety Service Personnel. Those employees in the positions of Police Chief and Police Captain shall be provided with the applicable disability benefits provided under Labor Code Section 4850.
SECTION 12. Parental Leave. The City Manager shall grant a female employee's request for a leave of absence without pay for the purposes of pregnancy, childbirth, or because of a disability caused by pregnancy or related complications, for a period not to exceed seven months. When the employee has notified the City Manager as to the period of the leave of absence required, any change in the length of the period of leave shall not be effective unless approved by the City Manager.
The City Manager shall grant the request of a male employee for a leave of absence without pay for a period not to exceed six months to care for his newborn child. When the employee has notified the City Manager as to the period of the leave of absence required, any change in the length of the period of leave shall not be effective unless approved by the City Manager.
The City Manager may grant an employee's request for a leave of absence without pay to care for a newly adopted child for a period not to exceed 6 months. The employee shall provide documentation to support the request for adoption leave. When the employee has notified the City Manager as to the period of the leave of absence required, any change in the length of the period of leave shall not be effective unless approved by the City Manager.
If leave without pay is utilized, no accruals of sick leave, vacation leave, other benefits or seniority will be credited to the employee. The employee shall not forfeit any of the benefits or seniority accumulated prior to the commencement of the Parental Leave.
Where permitted by law, leave granted under this Parental Leave Section shall run concurrently with leave as provided in the City of Los Alamitos’ Family Care and Medical Leave Policy, and the pregnancy disability leave portions of the California Fair Employment and Housing Act.
SECTION 13. Jury Duty. Subject to the exception described below, the City shall compensate an employee on jury duty for up to forty (40) working hours within the calendar year. When called to jury duty, an employee, having provided at least five (5) working days written notice, shall be entitled to his or her regular compensation provided that said employee deposits his or her compensation fees for jury service with the Finance Officer. Employees released early from jury duty shall report to their Department Director for the duration of their shift. Employees shall be entitled to keep mileage reimbursement pay while on jury duty. Consideration for salary continuation in excess of forty (40) working hours shall be conditioned upon sufficient evidence being presented to the City Manager that the employee advised the Court of a forty (40) working hour limitation on salary continuation being provided by the City, requested dismissal from jury duty, and that the Court did not excuse the employee from jury service.
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SECTION 14. Leave of Absence Without Pay. Any employee may be granted a personal leave of absence without pay for ninety (90) days or less with the approval of the City Manager. A request for a personal leave of absence exceeding ninety (90) days must also be approved by the City Manager.
A. Authorization Procedure. Requests for leave of absence without pay shall be made upon forms prescribed by the City Manager. The employee shall state the reason for the request, the date when the absence is to begin, and the probable date of return. The request shall normally be initiated by the employee, but may be initiated by the City Manager. The City Manager shall make his or her recommendation in writing and forward to the employee.
B. Length of Leave and Extension. A leave of absence without pay may be made for a period not to exceed six (6) months. Provisions for granting an extension of up to six (6) months shall be the same as that in granting the original leave, provided that the extension request is made no later than fourteen (14) calendar days prior to the expiration of the original leave.
C. Return From Leave. When an employee intends to return from an authorized leave of absence without pay, he or she shall contact the City Manager at least fourteen (14) calendar days prior to the day he or she plans to return.
D. Leave Without Pay - Insurance Payments. An employee on leave without pay may continue his or her City insurance benefits by reimbursing the City for the cost of insurance on a monthly basis during the period of the leave. Failure to reimburse the City for such benefits during the term of the leave of absence will result in the employee's coverage terminating on the last day of the month in which the last payment was received.
E. Leave Without Pay - Other Benefits. When leave of absence without pay is utilized, no accruals of sick leave, vacation leave, other benefits or seniority will be credited to the employee. The employee shall not forfeit any of the benefits or seniority accumulated prior to the commencement of the leave without pay.
F. Family Medical Leave – Insurance Payments. The City will continue to make insurance contributions on behalf of employees on approved Family Medical Leave for a maximum of twelve (12) weeks. Employees on approved Family Medical Leave will continue to be responsible for their out-of-pocket contribution toward insurance costs.
SECTION 15. Holidays.
A. Authorized Holidays. Employees shall be entitled to the following holidays with pay each calendar year as well as other such days as may be designated by action of the City Council:
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• January 1 (New Years Day)
• The third Monday in January (King's Birthday)
• The third Monday in February (President's Day)
• The last Monday in May (Memorial Day)
• July 4 (Independence Day)
• The first Monday in September (Labor Day)
• November 11 (Veterans Day)
• The fourth Thursday in November (Thanksgiving Day)
• The Friday after Thanksgiving Day
• December 24 (Christmas Eve)
• December 25 (Christmas)
• Eighteen (18) hours of floating holiday time to be used by the employee with City Manager approval during the calendar year (January 1 - December 31).
No employee shall accumulate more than eighteen (18) hours of floating holiday.
On January 1 of each year, each employee will receive only that number of floating holiday hours that is necessary to bring the accumulated total to eighteen (18) hours.
Employees that work “regular” eight hour days shall receive eight hours of holiday pay. Employees that work a “9/80” schedule shall receive nine hours of holiday pay except when the holiday falls on the Friday that the employee would normally work an eight hour day, in which case the employee shall receive eight hours of holiday pay.
B. Floating Holidays for New Employees. At the time of hire, new employees shall receive the following floating holiday hours based upon their date of hire:
Date of Hire 9/80 Regular
January 1 – March 31 18 16
April 1 – June 30 14 12
July 1 – September 30 10 8
October 1 – December 31 0 0
C. Procedure if Holiday Falls on Saturday or Sunday. When a holiday falls on a Saturday, the preceding Friday shall be observed as the holiday. When a holiday falls on a Sunday, the following Monday shall be observed as the holiday.
D. Non-Management Employees Required to Work on Holiday. Any NonManagement employee who shall be required to work on any holiday which he or she is entitled to take off under the above provisions shall receive equivalent time off, as determined by the City Manager.
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SECTION 16. Administrative Leave. Exempt employees may receive a maximum of eighty (80) hours of Administrative Leave annually. Employees shall not accrue more than eighty (80) hours of Administrative Leave, and shall not receive compensation for accrued Administrative Leave upon termination of employment. Administrative Leave accrual shall be prorated for exempt employees hired after the first full pay period in January.
SECTION 17. Exempt Employees. All non-represented employees are exempt and therefore not entitled to receive overtime compensation in accordance with the provisions of the Fair Labor Standards Act.
SECTION 18. Monthly Insurance Contribution. The monthly contribution from the City toward the payment of premiums for health, dental, and optical insurance programs shall be:
Employee Employee +1 Family
January 1, 2022 $1294 $1419 $1469
January 1, 2023 $1294 $1419 $1469
January 1, 2024 $1319 $1419 $1469
Any contribution necessary to maintain benefits under any insurance program in excess of the monthly City contribution shall be borne entirely by the employee.
Any employee who can certify that he/she is insured under another health plan, which has equal or better coverage than the City’s plan, may elect to receive $500.00 per month in lieu of participation in the City’s health program. Any employee who can certify that he/she is also insured under other dental and vision plans having equal or better coverage than the City’s plans, may elect to receive an additional $200.00 per month in lieu of participation in the City’s dental and vision programs, for a total of $700.00 per month of compensation in lieu of health, dental and vision insurance plan participation.
SECTION 19. Dental Plan. The City agrees to make available a dental plan to employees and dependents. Participation in this plan shall be at the option of the employee. Employees electing to participate in this plan may apply excess funds from the City’s monthly medical insurance contribution towards the premium payment of the dental plan. Any additional cost in excess of the City’s monthly medical insurance contribution shall be borne by the employee
SECTION 20. Optical Plan. The City agrees to make available an optical plan to employees and dependents. Participation in this plan shall be at the option of the employee. Employees electing to participate in this plan may apply excess funds from the City's medical insurance contribution towards the premium payment of the optical plan. Any additional cost in excess of the City's medical contribution shall be borne by the employee.