1. Basic Provisions ("Basic Provisions").
1.1 ParƟes. This Lease ("Lease"), dated for reference purposes only 6/11/2024 , is made by and between The city of San Clemente ("Lessor") and Trestles Property Management, LLC ("Lessee"), (collecƟvely the "ParƟes," or individually a "Party").
1.2 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, city, state, zip): 1100 N. El Camino Real, San Clemente Ca 92672 ("Premises"). The Premises are located in the County of Orange , and are generally described as(describe briefly the nature of the property and , if applicable, the "Project," if the property islocated within a Project): +- 1,400 SF freestanding building located on the corner of El Camino Real and El Portal . (See also Paragraph 2)
1.3 Term: 5 years and 0 months("Original Term") commencing 10/1/2024 ("Commencement Date") and ending 9/30/2029 ("ExpiraƟon Date"). (See also Paragraph 3)
1.4 Early Possession: If the Premises are available Lessee may have non-exclusive possession of the Premises commencing after receipt of security deposit, first month's rent, and proof of insurance ("Early Possession Date"). (See also Paragraphs 3.2 and 3.3)
1.5 Base Rent: $3,724 per month ("Base Rent"), payable on the 1st day of each month commencing 10/1/2024 . (See also Paragraph 4)
If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph 3% annual increases .
1.6 Base Rent and Other Monies Paid Upon ExecuƟon:
1.7 Agreed Use: general office for real estate services including property management . (See also Paragraph 6)
1.8 Insuring Party. Lessoris the "Insuring Party". The annual "Base Premium" is to be paid by tenant . (See also Paragraph 8)
1.9 Real Estate Brokers. (See also Paragraph 15 and 25) agency relaƟonships in this Lease with the following real estate brokers ("Broker(s)") and/or their agents("Agent(s)"):
Lessor's Brokerage Firm Kidder Mathews License No. 01946490 Isthe broker of (check one): the Lessor; or both the Lessee and Lessor (dual agent).
Lessor's Agent Josh Cunningham License No. 01802660 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 Lincoln Property Company License No. Isthe broker of (check one): the Lessee; or both the Lessee and Lessor (dual agent).
Lessee's Agent Garrick Shupe License No. is (check one): the Lessee's Agent (salesperson or broker associate); or both the Lessee's Agent and the Lessor's Agent (dual agent). separate wriƩen agreement (or if there is no such agreement, the sum of or 6 % of the total Base Rent) for the brokerage servicesrendered by the Brokers.
1.10 Guarantor. The obligaƟons of the Lessee under this Lease are to be guaranteed by Gary Ward ("Guarantor"). (See also Paragraph 37)
1.11 AƩachments. AƩached hereto are the following, all of which consƟtute a part of this Lease:
an Addendum consisƟng of Paragraphs 50 through 50.3 ;
a plot plan depicƟng the Premises;
a current set of the Rules and RegulaƟons;
a Work LeƩer;
other (specify): .
2. Premises.
2.1 Leƫng. Lessor hereby leases to Lessee, and Lessee hereby leases from 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
STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE - GROSS (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)
(a) Base Rent: $3,724 for the period 10/1/2024-10/31/2024 . (b) Security Deposit: $4,234 ("Security Deposit"). (See also Paragraph 5) (c) AssociaƟon Fees: for the period .
(d) Other: for .
(e) Total Due Upon ExecuƟon of this Lease: $7,958 .
(a) RepresentaƟon: Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency RelaƟonship, confirms and consents to the following (b) Payment to Brokers. Upon execuƟon and delivery of this Lease by both ParƟes, Lessor shall pay to the Brokersthe brokerage fee agreed to in a ATTACHMENT 2
purposes of comparison, the Base Rentstated herein is NOT Ɵed to square footage and is notsubject 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 the Premises 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 asthe required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days following the Start Date, warrantsthat the exisƟng electrical, plumbing, fire sprinkler, lighƟng, heaƟng, venƟlaƟng and air condiƟoning systems ("HVAC"), loading doors, sump pumps, if any, and all othersuch elements in the Premises, other than those constructed by Lessee, shall be in good operaƟng condiƟon on said date, that the surface and structural elements of the roof, bearing walls and foundaƟon of any buildings on the Premises (the "Building") shall 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 non-compliance with said warranty exists as of the Start Date, or if one of such systems or elements should malfuncƟon or fail within the appropriate warranty period, Lessor shall, as Lessor'ssole 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 ofsuch non-compliance, malfuncƟon or failure, recƟfy same at Lessor's expense. The warranty periods shall be as follows: (i) 6 months asto the HVAC systems, and (ii) 30 days asto the remaining systems and other elements of the Building. If Lessee does not give Lessor the required noƟce within the appropriate warranty period, correcƟon of any such non-compliance, malfuncƟon or failure shall be the obligaƟon of Lessee at Lessee's sole cost and expense, except for the roof, foundaƟons, and bearing walls which are handled as provided in 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 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 50), 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 acknowledgesthat 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 non-compliance, recƟfy the same at Lessor's expense. If Lessee does not give Lessor wriƩen noƟce of a non-compliance with this warranty within 6 monthsfollowing the Start Date, correcƟon of that non-compliance shall be the obligaƟon of Lessee at Lessee'ssole cost and expense. If the Applicable Requirements are hereaŌer changed so as to require during the term of this Lease the construcƟon of an addiƟon to or an alteraƟon of the 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 tenants in 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 an 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 days thereaŌer. Such terminaƟon date shall, however, in no event be earlierthan 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 Lessor shall pay for such 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 Lessorreasonably determines that it is not economically feasible to pay its share thereof, Lessor shall 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 for such 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, orif 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 non-voluntary, 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 for such Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lessee shall not, however, have any right to terminate this Lease.
2.4 Acknowledgements. Lessee acknowledgesthat: (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 their suitability 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 as to 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 Rent stated 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 acknowledgesthat: (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.
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 Premises issubject to and condiƟoned upon the Premises being available for such possession prior to the Commencement Date. Any grant of Early Possession only conveys a non-exclusive 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 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 agrees to 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, Lessor shall 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 ofsuch 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. Lessor shall 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 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 invoice prepared by Lessor isinaccurate such inaccuracy shall not consƟtute a waiver and Lessee shall be obligated to pay the amountset forth in this Lease. Rent for any period during the term hereof which is for lessthan 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 persons or 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 paymentsto be made by Lessee to be 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, Insurance and Real Property Taxes, and any remaining amount to any other outstanding charges or costs.
4.3 AssociaƟon Fees. In addiƟon to the Base Rent, Lessee shall pay to Lessor each month an amount equal to any owner's associaƟon or condominium fees levied or assessed against the Premises. Said monies shall be paid at the same Ɵme and in the same manner asthe Base Rent.
5. Security Deposit. Lessee shall deposit with Lessor upon execuƟon hereof the Security Deposit assecurity for Lessee'sfaithful 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 ofsaid 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 orincur 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 Lessor so 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, Lessor shall 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, Lessor shall 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 monies to 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 Premises in a manner that is unlawful, creates damage, waste or a nuisance, or that disturbs occupants of or 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 improvements on the Premises or the mechanical or electrical systemstherein, and/or is not significantly more burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall within 7 days aŌer such request give wriƩen noƟficaƟon of same, which noƟce shall include an explanaƟon of Lessor's objecƟons to 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 is required 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 materials reasonably 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 as such 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 ofsuch 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 or sanitary 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, harmless from 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, 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 Premises from adjacent properƟes 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 or suffered 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 ofsuch 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 result from Hazardous Substances which existed on the Premises prior to Lessee's occupancy 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. Lessor shall 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 Lessee's occupancy, unlesssuch remediaƟon measure is required 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 for such payment. Lessee shall cooperate fully in any such acƟviƟes at the request of Lessor, including allowing Lessor and Lessor's agents to 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 Ɵmes the 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 days thereaŌer, 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 or saƟsfactory 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 funds or 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 whethersaid 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 Requirements specified by Lessor, and shall immediately upon receipt, noƟfy Lessor in wriƟng (with copies of any documents involved) 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) 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. In addiƟon, Lessee shall provide Lessor with copies of its business license, cerƟficate of occupancy and/or any similar document within 10 days of the receipt of a wriƩen request therefor.
6.4 InspecƟon; Compliance. Lessor and Lessor's "Lender" (as defined in Paragraph 30) and consultants authorized by Lessor shall 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 a wriƩen request therefor. Lessee acknowledges that any failure on its part to allow such inspecƟons or 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/costs that 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's sole 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 for such repairs occurs as a result of Lessee's use, any prior use, the elements or the age ofsuch porƟon of the Premises), including, but not limited to, all equipment or faciliƟes, such as plumbing, HVAC equipment, electrical, lighƟng faciliƟes, boilers, pressure vessels, fire protecƟon system, fixtures, walls (interior and exterior), ceilings, floors, stairs, windows, doors, plate glass, skylights, landscaping, driveways, parking lots, fences, retaining walls, signs, sidewalks and parkways located in, on, or adjacent to the Premises. Lessee is also responsible for keeping the roof and roof drainage clean and free of debris. Lessor shall keep the surface and structural elements of the roof, foundaƟons, and bearing walls in good repair (see paragraph 7.2). Lessee, in keeping the Premisesin 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 improvementsthereon or a part thereof in good order, condiƟon and state of repair. Lessee shall, during the term of this Lease, keep the exterior appearance of the Building in a first-class condiƟon (including, e.g. graffiƟ removal) consistent with the exterior appearance of othersimilar faciliƟes of comparable age and size in the vicinity, including, when necessary, the exterior repainƟng of the Building. (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 contractors specializing 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, (iii) fire exƟnguishing systems, including fire alarm and/or smoke detecƟon, (iv) landscaping and irrigaƟon systems, and (v) 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 Premises in 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), 9 (Damage or DestrucƟon) and 14 (CondemnaƟon), it is intended by the ParƟes hereto that Lessor have no obligaƟon, in any manner whatsoever, to repair and maintain the Premises, or the equipment therein, all of which obligaƟons are intended to be that of the Lessee, except for the surface and structural elements of the roof, foundaƟons and bearing walls, the repair of which shall be the responsibility of Lessor upon receipt of wriƩen noƟce that such a repair is necessary. It isthe intenƟon of the ParƟes that the terms of this Lease govern the respecƟve obligaƟons of the ParƟes asto maintenance and repair 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 non-structural 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 as-built 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 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 Lessor shall have the right to post noƟces of non-responsibility. 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's right 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 Premises for 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 orfor Lessee.
Lessee shall also completely 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 levelspecified 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 earlierterminaƟon 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) Lessee shall pay to Lessor any insurance cost increase ("Insurance Cost Increase") occurring during the term of this Lease. Insurance Cost Increase is defined as any increase in the actual cost of the insurance required under Paragraph 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 increases resulƟng from the nature of Lessee's occupancy, any act or omission of Lessee, requirements of the holder of mortgage or deed of trust covering the Premises, increased valuaƟon of the Premises and/or a premium rate increase. The parƟes are encouraged to fill in the Base Premium in Paragraph 1.8 with a reasonable premium for the Required Insurance based on the Agreed Use of the Premises. If the parƟesfail to insert a dollar amount in Paragraph 1.8, then the Base Premium shall be the lowest annual premium reasonably obtainable for the Required Insurance as of the commencement of the Original Term for the Agreed Use of the Premises. In no event, however, shall Lessee be responsible for any porƟon of the increase in the premium cost aƩributable to liability insurance carried by Lessor under Paragraph 8.2(b) in excess of $2,000,000 per occurrence. (b) Lessee shall pay any such Insurance Cost Increase to Lessor within 30 days aŌer receipt by Lessee of a copy of the premium statement or other reasonable evidence of the amount due. If the insurance policies maintained hereunder cover other property besides the Premises, Lessor shall also deliver to Lessee a statement of the amount ofsuch Insurance Cost Increase aƩributable only to the Premisesshowing in reasonable detail the manner in which such amount was computed. Premiumsfor policy periods commencing prior to, or extending beyond the term of this Lease, shall be prorated to correspond to the term of this Lease.
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 less than $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 as the Insurance Service OrganizaƟon's "AddiƟonal Insured-Managers or Lessors of Premises" Endorsement. The policy shall not contain any intra-insured 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 its insurance shall be primary to and not contributory with any similar insurance carried by Lessor, whose insurance shall be considered excess insurance only. (b) Carried by Lessor. Lessor shall 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. The Insuring Party shall obtain and keep in force a policy or policiesin the name of Lessor, with loss payable to Lessor, any ground-lessor, 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, but in 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 unless required by a Lender or included in the Base Premium), 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 asthe result of a covered loss. Said policy or policies shall also contain an agreed valuaƟon provision in lieu of any coinsurance clause, waiver ofsubrogaƟon, 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 amountshall not exceed $5,000 per occurrence, and Lessee shall be liable for such deducƟble amount in the event of an Insured Loss. (b) Rental Value. The Insuring Party shall obtain and keep in force a policy or policies in 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 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. Lessee shall be liable for any deducƟble amount in the event of such loss. (c) Adjacent Premises. If the Premises are part of a larger building, or of a group of buildings owned by Lessor which are adjacent to the Premises, the Lessee shall pay for any increase in the premiums for the property insurance of such building or buildingsif said increase is caused by Lessee's acts, omissions, use or occupancy of the Premises.
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) BusinessInterrupƟon. 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, as set forth in the most current issue of "Best'sInsurance Guide", or such other raƟng as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidates the 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 his liability insurance coverage and charge the cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon demand. Such policies shall 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 that such 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 Lessor shall 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 Agentsfrom 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, whethersuch damage or injury is caused by or results from 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 of which the Premises are a part, 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 is intended that Lessee's sole recourse in the event ofsuch damages or injury be to file a claim on the insurance policy(ies) that Lessee is required to maintain pursuant to the provisions of paragraph 8.
8.9 Failure to Provide Insurance. Lessee acknowledgesthat 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 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. The parƟes agree that such increase in Base Rent representsfair 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 6 months orless from the date of the damage or destrucƟon. 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. (b) "Premises Total DestrucƟon" shall mean damage or destrucƟon to the Premises, other than Lessee Owned AlteraƟons and UƟlity InstallaƟons and Trade Fixtures, which cannot reasonably be repaired in 6 months or less from the date of the damage or destrucƟon. Lessorshall noƟfy Lessee in wriƟng within 30 daysfrom 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.
(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 Lessor shall, at Lessor's expense, repair such damage (but not Lessee's Trade Fixtures or Lessee Owned AlteraƟons and UƟlity InstallaƟons) as soon 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 basisfor 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 (except as to the deducƟble which is Lessee's responsibility) as and when required to complete said repairs. In the event, however, such shortage was due to the fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not commercially reasonable and available, Lessor shall have no 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 daysfollowing receipt of wriƩen noƟce of such shortage and request therefor. If Lessor receives said funds or adequate assurance thereof within said 10 day period, the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. If such funds or assurance are not 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, 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 ofsuch damage without reimbursement from Lessor. Lessee shall provide Lessor with said funds or saƟsfactory 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 as soon 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 ofsuch 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's receipt 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 as soon 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 is impaired, 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 aŌersuch 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 days thereaŌer, 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 DefiniƟon. 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 Premises or 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 Building address. 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 Premises, and (ii) levied or assessed on machinery or equipment provided by Lessor to Lessee pursuant to this Lease.
10.2 Payment of Taxes. Lessor shall pay the Real Property Taxes applicable to the Premises provided, however, that Lessee shall pay to Lessor the amount, if any, by which Real Property Taxes applicable to the Premises increase over the fiscal tax year during which the Commencement Date Occurs("Tax Increase"). Payment of any such Tax Increase shall be made by Lessee to Lessor within 30 days aŌer receipt of Lessor's wriƩen statement seƫng forth the amount due and computaƟon thereof. If any such taxes shall cover any period of Ɵme prior to or aŌer the expiraƟon or terminaƟon of this Lease, Lessee's share of such taxes shall be prorated to cover only that porƟon of the tax bill applicable to the period that this Lease is in effect. In the event Lessee incurs a late charge on any Rent payment, Lessor may esƟmate the current Real Property Taxes, and require that the Tax Increase be paid in advance to Lessor by Lessee monthly in advance with the payment of the Base Rent. Such monthly payment shall be an amount equal to the amount of the esƟmated installment of the Tax Increase divided by the number of months remaining before the month in which said installment becomes delinquent. When the actual amount of the applicable Tax Increase is known, the amount of such equal monthly advance payments shall be adjusted asrequired to provide the funds needed to pay the applicable Tax Increase. If the amount collected by Lessor is insufficient to pay the Tax Increase when due, Lessee shall pay Lessor, upon demand, such addiƟonal sums as are necessary to pay such obligaƟons. Advance payments may be intermingled with other moneys of Lessor and shall not bear interest. In the event of a Breach by Lessee in the performance of its obligaƟons under this Lease, then any such advance payments may be treated by Lessor as an addiƟonal Security Deposit.
10.3 AddiƟonal Improvements. Notwithstanding anything to the contrary in this Paragraph 10.2, Lessee shall pay to Lessor upon demand therefor the enƟrety of any increase in Real Property Taxes assessed by reason of AlteraƟons or UƟlity InstallaƟons placed upon the Premises by Lessee or at Lessee's request or by reason of any alteraƟons or improvementsto the Premises made by Lessor subsequent to the execuƟon of this Lease by the ParƟes.
10.4 Joint Assessment. If the Premises are notseparately assessed, Lessee's liability shall be an equitable proporƟon of the Tax Increase for all of the land and improvements included within the tax parcel assessed, such proporƟon to be conclusively determined by Lessor from the respecƟve valuaƟons assigned in the assessor's work sheets or such other informaƟon as may be reasonably available.
10.5 Personal Property Taxes. Lessee shall pay, prior to delinquency, all taxes assessed against and levied upon Lessee Owned AlteraƟons, UƟlity InstallaƟons, Trade Fixtures, furnishings, equipment and all personal property of Lessee. 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's said property shall be assessed with Lessor's real 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. If any such services are not separately metered or billed to Lessee, Lessee shall pay a reasonable proporƟon, to be determined by Lessor, of all charges jointly metered or billed. There shall be no abatement of rent and Lessor shall not be liable in any respect whatsoever for the inadequacy, stoppage, interrupƟon or disconƟnuance of any uƟlity or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause beyond Lessor's reasonable control or in cooperaƟon with governmental request or direcƟons.
11.2 Within fiŌeen days of Lessor's wriƩen request, Lessee agrees to deliver to Lessor such informaƟon, documents and/or authorizaƟon as Lessor needs in order for Lessorto 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's interest 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 willresult in a reducƟon of the Net Worth of Lessee by an amount greater than 25% of such Net Worth asit was represented 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 or subleƫng without consentshall, at Lessor's opƟon, be a Default curable aŌer noƟce per Paragraph 13.1(d), or a non-curable Breach without the necessity of any noƟce and grace period. If Lessor elects to treatsuch unapproved assignment or subleƫng as a non-curable 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 non-fixed 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 Lessor shall be limited to compensatory damages and/or injuncƟve relief. (f) Lessor may reasonably withhold consent to a proposed assignment or subleƫng if Lessee is in Default at the Ɵme consent is requested. (g) Notwithstanding the foregoing, allowing a de minimis porƟon of the Premises, i.e. 20 square feet orless, to be used by a third party vendor in connecƟon with the installaƟon of a vending machine or payphone 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 remedies for 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 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 or subleƫng shall not transfer to the assignee or sublessee 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 excess shall be refunded to Lessee. Lessor shall not, by reason of the foregoing or any assignment ofsuch 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 Rents to 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 Lessor shall undertake the obligaƟons of the sublessor undersuch sublease from the Ɵme of the exercise of said opƟon to the expiraƟon of such sublease; provided, however, Lessor shall not be liable for any prepaid rents or security 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 or sublet 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 as the 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 Premises in 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 or surety 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 daysfollowing 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 non-curable 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 or subleƫng, (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 42, (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 daysfollowing 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 40 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's refusal 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 or security, which, when coupled with the then exisƟng resources of Lessee, equals or exceedsthe combined financial resources of Lessee and the Guarantors that existed at the Ɵme of execuƟon of this Lease.
13.2 Remedies. If Lessee fails to 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; (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 loss that 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's failure 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 rent or 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's right 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, efforts to 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 as to 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 ofsaid 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 one-Ɵme 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 ofsuch 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. Lessor shall 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 cures said 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, that such offset shall not exceed an amount equal to the greater of one month's Base Rent or the Security Deposit, reserving Lessee'sright to seek reimbursement from Lessor for any such expense in excess of such offset. Lessee shall document the cost ofsaid 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 Building, or more than 25% of that porƟon of the Premises not occupied by any building, istaken by CondemnaƟon, Lessee may, at Lessee's opƟon, to be exercised in wriƟng within 10 days aŌer Lessor shall have given Lessee wriƩen noƟce of such taking (or in the absence ofsuch 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 asto the porƟon of the Premises remaining, except that the Base Rentshall 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 for severance 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, Lessor shall repair any damage to the Premises caused by such CondemnaƟon.
15. Brokerage Fees.
15.1 AddiƟonal Commission. In addiƟon to the payments owed pursuant to Paragraph 1.9 above, Lessor agrees that: (a) if Lessee exercises any OpƟon, (b) if Lessee or anyone affiliated with Lessee acquires any rights to the Premises or other premises owned by Lessor and located within the same Project, if any, within which the Premisesis located, (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 is increased, whether by agreement or operaƟon of an escalaƟon clause herein, then, Lessor shall pay Brokers a fee in accordance with the fee schedule of the Brokers in 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 1.9, 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 amounts shall accrue Interest. In addiƟon, if Lessor failsto 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 monies to its Broker and offset such amounts against Rent. In addiƟon, Lessee's Broker shall 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 harmless from 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/or statements as may be reasonably requested by the RequesƟng Party. (b) If the Responding Party shall failto 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's rent 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 failure on 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 desiresto 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 Lessor such 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. Allsuch 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 orthis 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 Lessor shall 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 or shareholders, 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 noƟces required 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 ifserved in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party's signature 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 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 Lessor shall 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 as the 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 duƟesset 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 has the 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 duƟesto 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 agreements to 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 asif 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 are located. Signatures to this Lease accomplished by means of electronic signature or similar technology shall be legal and binding.
30. SubordinaƟon; AƩornment; Non-Disturbance.
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 OpƟons shall 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 non-disturbance 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 Non-Disturbance. 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 non-disturbance agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance 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, Lessor shall, if requested by Lessee, use its commercially reasonable effortsto obtain a Non-Disturbance Agreement from the holder of any pre-exisƟng Security Device which is secured by the Premises. In the event that Lessor is unable to provide the Non-Disturbance 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 Non-Disturbance Agreement.
30.4 Self-ExecuƟng. 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 Lessor shall execute such further wriƟngs as may be reasonably required to separately document any subordinaƟon, aƩornment and/or Non-Disturbance 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. The aƩorneys' 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 is subsequently 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 ofshowing 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 as there is no material adverse effect on Lessee's use of the Premises. Allsuch 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 "forsublease" signs, Lessee shall not place any sign upon the Premises 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 ofsuch interest.
36. Consents. All requestsfor consent shall be in wriƟng. Except as otherwise provided herein, wherever in this Lease the consent of a Party is required 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, nor shall 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 reasons for such determinaƟon, the determining party shall furnish its reasons 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. It shall 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 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 is in full possession of the Premises and, if requested by Lessor, with Lessee cerƟfying that Lessee has no intenƟon of thereaŌer assigning or subleƫng.
39.3 MulƟple OpƟons. In the event that Lessee has any mulƟple OpƟonsto extend or renew this Lease, a later OpƟon cannot be exercised unless the 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 unƟlsaid 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 3 or 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 aŌersuch Rent becomes due (without any necessity of Lessor to give noƟce thereof), or (ii) if Lessee commits a Breach of this Lease.
40. MulƟple Buildings. If the Premises are a part of a group of buildings controlled by Lessor, Lessee agreesthat it will abide by and conform to all reasonable rules and regulaƟons which Lessor may make from Ɵme to Ɵme for the management,safety, and care of said properƟes, including the care and cleanliness of the grounds and including the parking, loading and unloading of vehicles, and to cause its employees, suppliers, shippers, customers, contractors and inviteesto so abide and conform. Lessee also agrees to pay its fair share of common expenses incurred in connecƟon with such rules and regulaƟons.
41. 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.
42. ReservaƟons. Lessor reservesto itself the right, from Ɵme to Ɵme, to grant, without the consent or joinder of Lessee,such easements, rights and dedicaƟons that Lessor deems necessary, and to cause the recordaƟon of parcel maps and restricƟons, so long assuch easements, rights, dedicaƟons, maps and restricƟons do not unreasonably interfere with the use of the Premises by Lessee. Lessee agrees to sign any documentsreasonably requested by Lessor to effectuate any such easement rights, dedicaƟon, map orrestricƟons.
43. Performance Under Protest. If at any Ɵme a dispute shall arise as to any amount or sum 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 ofsuch 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 months shall be deemed to have waived itsright to protest such payment.
44. 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 or she 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 Lessees shall 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 togethershall consƟtute one and the same instrument.
45. Conflict. Any conflict between the printed provisions of this Lease and the typewriƩen or handwriƩen provisionsshall be controlled by the typewriƩen or handwriƩen provisions.
46. Offer. PreparaƟon of this Lease by either Party or their agent and submission of same to the other Party shall not be deemed an offerto lease to the other Party. This Lease is not intended to be binding unƟl executed and delivered by all ParƟes hereto.
47. 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 non-monetary modificaƟonsto this Lease as may be reasonably required by a Lender in connecƟon with the obtaining of normal financing or refinancing of the Premises.
48. 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 LEASE.
49. 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.
50. 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 determine whether the subject premises comply with all of the applicable construcƟon-related 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 premises for 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 construcƟon-related 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 construcƟon-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledgesthat 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 construcƟon-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledgesthat 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 Lessor shall 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, 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 city of San Clemente
By:
Name Printed:
Title:
Phone:
Fax:
Email:
By:
Name Printed:
Title:
Phone:
Fax:
Email:
Address:
Federal ID No.:
Executed at:
On:
By LESSEE:
Trestles Property Management, LLC
By:
Name Printed:
Title:
Phone:
Fax:
Email:
By:
Name Printed:
Title:
Phone:
Fax:
Email:
Address:
Federal ID No.:
BROKER
Kidder Mathews
AƩn: Josh Cunningham
Title:
Address:
Phone:
Fax:
Email:
Federal ID No.:
Broker DRE License #:
Agent DRE License #:
BROKER
Lincoln Property Company
AƩn:
Title:
Address:
Phone:
Fax:
Email:
Federal ID No.:
Broker DRE License #:
Agent DRE License #:
AIR CRE * hƩps://www.aircre.com * 213-687-8777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
ADDENDUM TO LEASE
Date: 6/11/2024
By and Between
Lessor: The city of San Clemente
Lessee: Trestles Property Management, LLC
Property Address: 1100 N. El Camino Real, San Clemente Ca 92672 (street address, city, state, zip)
Paragraph: 50
ADDENDUM TO THAT CERTAIN COMMERCIAL LEASE AGREEMENT, DATED FOR REFERENCE PURPOSES ONLY, JUNE 6/11/2024, MADE BY AND BETWEEN THE CITY OF SAN CLEMENTE, AS LESSOR, AND TRESTLES PROPERTY MANAGEMENT, LLC., AS LESSEE, FOR THE PROPERTY LOCATED AT 1100 N. EL CAMINO REAL, SAN CLEMENTE, CALIFORNIA.
1.LEASE PREPARATION: This Lease, Addendum, Exhibit and Guaranty of Lease have been prepared by Kidder Mathews, at the request of Lessor and Lessee. The Lessor and Lessee agree to indemnify, defend, and hold harmless Kidder Mathews, its respective agents, and employees from and against any claims, expenses, losses, and liabilities including without limitation, attorney fees and costs that may be occasioned as a result of completing this Standard Industrial/Commercial Lease Form, Addendum, Exhibit and Guaranty of Lease. Lessor and Lessee acknowledge being advised by Kidder Mathews, to have this Lease, Addendum, Exhibit and Guaranty of Lease reviewed by their respective attorneys.
2.RENTAL INCREASE: The base rent shall be calculated on a modified gross basis at an initial rate of $2.66 per rentable square foot with fixed annual increases of three percent (3%). The rent schedule as follows:
(2) $3,836
(3) $3,991
(4) $4,111
(5) $4,234
3.TENANT IMPROVEMENTS: Lessor shall deliver space in a clean, in good repair, fully operational, move-in condition. Costs associated with any additional Lessee improvements shall be paid at Lessee's and subject to Lessor's prior written approval.
In the event of any conflict between the provisions of this Addendum and the printed provisions of the Lease, this Addendum shall control.
AIR CRE * hƩps://www.aircre.com * 213-687-8777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
OPTION(S) TO EXTEND TERM
STANDARD LEASE ADDENDUM
Dated: 6/11/2024
By and Between
Lessor: The city of San Clemente
Lessee: Trestles Property Management, LLC
Property Address: 1100 N. El Camino Real, San Clemente Ca 92672 (street address, city, state, zip)
Paragraph: 51 OPTION(S) TO EXTEND TERM. Subject to the terms, condiƟons and provisions of Paragraph 39, Lessor grants Lessee 1 opƟon(s) to extend the term of the Lease ("Extension OpƟon(s)"), with each Extension OpƟon being for a term of 36 months, commencing when the prior term expires("OpƟon Term(s)"). In order to exercise an Extension OpƟon, Lessee must give wriƩen noƟce ofsuch elecƟon to Lessor and Lessor must receive such noƟce at least 6 but not more than 9 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 isthe OpƟon Term Comparison CPI (as herein defined). The amount so calculated shall consƟtute the new Base Rent unƟl the next OpƟon Term CPI Increase Date during the applicable OpƟon Term, but in no event shall any such new Base Rent be less than 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 Premisesis located, All Items(1982-1984 = 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 is transferred 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 maƩer shall 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 Rentshall be increased on and every monthsthereaŌer 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 10/1/2029 , 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 ofsuch Fair Market Value, Base Rent during an OpƟon Term shall not be lessthan the Base Rent scheduled 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 ofsuch Party'sselected valuator who shall meet the qualificaƟons set forth herein ("Advocate Valuator(s)"). Lessor and Lessee may select an Advocate Valuator who isfavorable to such Party's posiƟon and may, prior to or aŌer appointment of an Advocate Valuator, consult with such Party's Advocate Valuator. If a Party fails to Ɵmely and properly provide noƟce of such Party's chosen Advocate Valuator, then the other Party's SubmiƩed Value shall be the Fair Market Value. (c) If both ParƟes Ɵmely and properly designate Advocate Valuators, then such Advocate Valuators shall, within fiŌeen (15) days aŌer their selecƟon, choose a third (3rd) neutral valuator who shall meet the qualificaƟons set forth herein ("Neutral Valuator"). The Neutral Valuator shall be engaged jointly by Lessor and Lessee.
If Advocate Valuatorsfail to agree upon and Ɵmely appoint a Neutral Valuator, then the President of AIR CRE shall appoint such Neutral Valuator within fiŌeen (15) days aŌer request by either Party. If the President of AIR CRE does not Ɵmely appoint the Neutral Valuator, then either Party may file an appropriate legal acƟon for a judge with competent jurisdicƟon over the ParƟes to appoint the Neutral Valuator. (d) The Advocate Valuators and the Neutral Valuator ("Valuator(s)") shall be duly licensed real estate brokers or salespersons in good standing in the state in which the Premisesis located, 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 Valuator shall addiƟonally not be related to or affiliated with either Party or Advocate Valuator, 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 Valuatorsshall be decided by a majority vote of the Valuators, with each Valuator having one (1) vote. The Valuators may, as the Valuators determine, hold hearings and require briefs, including market data and addiƟonal informaƟon. (e) Within thirty (30) days aŌerselecƟon of the Neutral Valuator, the Valuatorsshall first determine the Fair Market Value established by taking into account the terms, assumpƟons and condiƟons set forth herein ("Valuators' Market Value"), then decide which Party's SubmiƩed Value is closer in monetary amount to the Valuators' Market Value ("Selected Market Value"), then provide the ParƟes a copy of the Valuators' Market Value and finally noƟfy the ParƟes of the Selected Market Value. The Selected Market Value shall be the Fair Market Value. The Valuators shall have no right to decide a Selected Market Value which is a compromise to (or modificaƟon of) the SubmiƩed Values. The decision of the Valuators shall be binding upon the ParƟes. The Party whose SubmiƩed Value is not the Selected Market Value shall, within ten (10) days aŌer the Valuators decide the Selected Market Value, pay the fees and costs of all three (3) Valuators. (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 ofsuch rent shall not waive, adversely affect or prejudice the ParƟes' right to complete establishment of the Fair Market Value or Lessor's right 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 Valuators, in deciding the Valuators' 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 for space 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 Valuators, in deciding the Valuators' 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 ofspace that wassubject to a right of first refusal, right of first offer, expansion opƟon or other encumbrances. The Valuators, in deciding the Valuators' 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's improvement 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 Premises for which Lessee wasresponsible 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 Brokers shall 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 * 213-687-8777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
GUARANTY OF LEASE
WHEREAS Trestles Property Management, LLC ("Lessee") desires to lease from The city of San Clemente ("Lessor") the premises commonly known as(street address, city, state, zip) 1100 N. El Camino Real, San Clemente Ca 92672 ("Premises") pursuant to a lease dated for reference purposes only as of 6/11/2024 ("Lease").
WHEREAS, as a material inducement to and in consideraƟon of Lessor execuƟng the Lease, Lessor requires Gary Ward ("Guarantor") to execute this Guaranty of Lease ("Guaranty"); Guarantor desires Lessee to consummate the Lease. Accordingly, contemporaneous with execuƟon of the Lease, Guarantor is execuƟng this Guaranty to induce Lessor to execute the Lease with Lessee.
NOW THEREFORE, Guarantor hereby uncondiƟonally and irrevocably guarantees and promises to perform and be liable for any and all obligaƟons and liabiliƟes of Lessee under the Lease, including, but not limited to, payment of all rents and all other sums payable by Lessee under the Lease and performance by Lessee of each and every one of the terms, condiƟons and covenants to be kept and performed by Lessee under the Lease.
Guarantor hereby agreesthat, without the consent of, or noƟce to, Guarantor and without affecƟng or in any way releasing Guarantor's obligaƟons under this Guaranty: (i) Lessor and Lessee may, by agreement or course of conduct, amend, extend, renew or otherwise alter any term, covenant or condiƟon of the Lease, or the Lease may be assigned by Lessor or Lessee (and their successors and assigns) and this Guaranty shall guarantee all obligaƟons of Lessee under the Lease as so amended, extended, renewed, altered or assigned; (ii) Lessor may release, change or add a party to the Lease and/or a guarantor of the Lease; (iii) Lessor may exercise, not exercise, delay exercising, impair, modify, limit, terminate or suspend any of Lessor's rights or remedies under the Lease or this Guaranty; and (iv) Lessor may permit all or any part of the Premises to be subleased, or the Lease to be assigned, assumed, transferred, mortgaged or encumbered.
Guarantor hereby agreesthat no noƟce of nonperformance or default by Lessee or by another guarantor need be given to Guarantor. This Guaranty is a conƟnuing and irrevocable guarantee. Guarantor waives the benefit of any law allowing Guarantor to revoke this Guaranty. No provision of this Guaranty or rights of Lessor hereunder may be waived, nor may any Guarantor be released from any obligaƟon under this Guaranty except by a wriƟng duly executed by Lessor.
Guarantor hereby waives and agrees not to assert or take advantage of any right or defense based on: (i) noƟce of acceptance of this Guaranty; (ii) demands (including demands for payment or performance), presentaƟon and protest; (iii) any statute of limitaƟons; (iv) requiring Lessor to proceed against Lessee, any Guarantor or other guarantor or any other person (as herein defined) liable to Lessor, or to proceed against these persons in any order; (v) requiring Lessor to apply any security deposit or othersecurity; (vi) requiring Lessor to proceed under any other remedy Lessor may have before proceeding against Guarantor; (vii) any right of subrogaƟon that Guarantor may have against Lessee or other guarantors; (viii) any right or defense that may arise by reason of the incapacity, lack of authority, death or disability of Lessee, any guarantor or any other person; (ix) any right or defense arising by reason of the absence, impairment, modificaƟon, limitaƟon, destrucƟon or cessaƟon (in bankruptcy, by an elecƟon of remedies, or otherwise) of the liability of Lessee, of the subrogaƟon rights of Guarantor, or of the rights of Guarantor to proceed against Lessee for reimbursement; (x) limiƟng Guarantor's obligaƟons to not exceed Lessee's obligaƟons; and (xi) noƟces(including noƟces of adverse change in the financial status of Lessee or other facts that increase the risk to Guarantor).
The obligaƟons of Guarantor under this Guaranty shall not be altered, limited or affected by any proceeding, voluntary or involuntary, involving the bankruptcy, insolvency, receivership, reorganizaƟon or liquidaƟon of Lessee, Guarantor, any other guarantor, or by any defense that Lessee, Guarantor or any other guarantor may have by reason of any order, decree, or decision of any court or administraƟve body resulƟng from any such proceeding.
Guarantorsubordinates any and all exisƟng or future indebtedness of Lessee to Guarantor to Lessee's obligaƟons owed to Lessor under the Lease. Any recovery by Lessor from any other guarantor or insurer shall first be credited to the porƟon of Lessee'sindebtedness to Lessor which exceeds the maximum liability of Guarantor under this Guaranty. If a person comprising Guarantor is married, such Guarantor expressly agrees that recourse may be had againstsuch Guarantor's separate or community property.
Guarantorshall, upon ten (10) days' prior wriƩen noƟce from Lessor, provide Lessor with Guarantor's financial statements for the current year and tax returns for the three (3) preceding years and, if such isthe normal pracƟce of Guarantor, such statementsshall be prepared in accordance with generally accepted accounƟng principles and audited by an independent cerƟfied public accountant. Lessor shall maintain Guarantor's financial statements and tax returns in confidence butshall be permiƩed to disclose Guarantor's financial statements and tax returns to prospecƟve lenders, purchasers or othersfor a bona fide business purpose.
Guarantorshall, upon ten (10) days' prior wriƩen noƟce from Lessor, in wriƟng reaffirm that this Guaranty remains and conƟnuesin full force and effect, that no event has occurred that would invalidate the Guaranty or excuse Guarantor's obligaƟons or performance under the Guaranty, and that the Guaranty appliesto the Lease, as amended, extended, renewed, altered or assigned. Guarantor shall, upon ten (10) days' prior wriƩen noƟce from Lessor, execute such other and further documents and do such further acts as may be reasonably necessary or required by Lessor to effectuate the intent of the parƟes and carry out the terms of this Guaranty.
Guarantor agrees that any suit, acƟon or proceeding arising directly or indirectly from the Guaranty or the Lease shall be liƟgated only in courts located within the county and state in which the Premises is located. Guarantor irrevocably consents to the jurisdicƟon of any local,state or federal court located within the county and state in which the Premises is located, and waives and agrees not to assert by way of moƟon, defense or otherwise in any suit, acƟon, or proceeding any claim that Guarantor is not personally subject to the jurisdicƟon of the above-named courts, that such suit, acƟon, or proceeding is brought in an inconvenient forum, or that the venue of such acƟon, suit, or proceeding is improper.
Each person which comprises Guarantor consents to service of process by a naƟonally recognized overnight courier service (such as Federal Express) at either the Premises or at the Guarantor's address for noƟces set forth below, and shall be deemed served and received three (3) business days aŌer deposit with the overnight mail service. Guarantor irrevocably waives and agrees not to plead or claim in any acƟon or proceeding thatsuch service of process was in any way invalid or ineffecƟve. Lessor reserves the right to serve processin any other manner permiƩed by law.
This Guaranty shall be governed by the laws of the state in which the Premises is located and, for purposes of conflicts of law, Guarantor shall be treated asif resident of or domiciled in such state. Guarantor waives the right to a jury trial of any cause of acƟon, claim, counterclaim or cross-complaint in any acƟon, proceeding or other hearing brought against Guarantor. If and to the extent the Lease requires Lessor and Lessee to arbitrate any disputes, then Guarantor also agrees to arbitrate such disputes in the same arbitraƟon to the extent related to the Guaranty and upon the same terms and condiƟons provided in the Lease.
If Lessor brings an acƟon or proceeding against Guarantor to enforce this Guaranty, 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, the party who substanƟally obtains or defeats the reliefsought, asthe case may be, whether by compromise, seƩlement, judgment, or the abandonment by the other party of its claim or defense. The aƩorneys' fees award shall not be computed in accordance with any court fee schedule, but shall be such asto fully reimburse all aƩorneys' feesreasonably incurred.
This Guaranty consƟtutes the enƟre agreement between Guarantor and Lessor with respect to the subject maƩer of this Guaranty and supersedes all prior agreements, understandings, negoƟaƟons, representaƟons and discussions, whether verbal or wriƩen, of the parƟes, pertaining to such subject maƩer. Guarantor is not relying on any representaƟons, warranƟes or inducements from Lessor that are not expressly stated in this Guaranty.
If any provision of this Guaranty is determined to be illegal or unenforceable, all other provisions hereof shall nevertheless be effecƟve. The waiver or failure to enforce any provision of this Guaranty shall not operate as a waiver of any other breach ofsuch provision or any other provisions of this Guaranty, nor shall any single or parƟal exercise of any right, power or privilege preclude any other or further such exercise or the exercise of any other right, power or privilege. Time is strictly of the essence under this Guaranty and any amendment, modificaƟon or revision of this Guaranty.
Each person execuƟng this Guaranty represents and warrants to Lessor that (i) each individual execuƟng this Guaranty has the legal power, right, and actual authority to bind Guarantor; (ii) Guarantor has the legal right, power and authority to enter into and perform this Guaranty; (iii) all requisite acƟon by or on behalf of a corporaƟon, limited liability company, partnership (general or limited), trust or other legal enƟty ("enƟty") has been taken for this Guaranty to be duly authorized by such enƟty or Guarantor; (vi) no consent of any partner, shareholder, member, creditor, investor, government, judicial or administraƟve body or other party isrequired in connecƟon with Guarantor execuƟng this Guaranty; (v) this Guaranty is a valid and legally binding obligaƟon of Guarantor; (vi) the execuƟon and delivery of this Guaranty does not conflict with or result in the material breach of any terms, condiƟons or provisions of, or consƟtute a default under, any bond, note, or other evidence of indebtedness or any contract, indenture, mortgage, deed of trust, loan, partnership agreement or other agreements or instruments to which Guarantor is a party or by which Guarantor is bound; and (vi) Guarantor will derive a substanƟal and material economic benefit from Lessor's execuƟon of the Lease. If Guarantor is an enƟty, Guarantor shall, concurrently with the execuƟon of this Guaranty (or upon ten (10) days' prior wriƩen noƟce from Lessor), deliver to Lessor a cerƟfied copy of a resoluƟon or other documentaƟon evidencing that such enƟty is authorized or raƟfiesthe enƟty's execuƟon of this Guaranty.
The term "person" as used in this Guaranty shall include an individual and/or an enƟty. If more than one (1) person comprises Guarantor, the obligaƟons ofsuch persons shall be joint and several. The unenforceability of this Guaranty or Lessor's elecƟon not to enforce this Guaranty against one (1) or more persons shall not affect the obligaƟons of the remaining persons which comprise Guarantor or the enforceability of this Guaranty againstsuch remaining persons.
Any noƟce, request, demand, instrucƟon or other communicaƟon to be given to Guarantor under this Guaranty shall be in wriƟng and shall be delivered at either the Premises or the address set forth beneath the Guarantor's signature below, or to such other place as Guarantor may from Ɵme to Ɵme in wriƟng designate by at least fiŌeen (15) days' noƟce to Lessor.
When the context and construcƟon so requires, all words used in the singular in this Guaranty shall be deemed to have been used in the plural. The term "Lessee" as used in this Guaranty shall mean the Lessee named in the Lease, any assignee of Lessee'sinterest under the Lease and their respecƟve successors and assigns. The term "Lessor" as used in this Guaranty shall mean the Lessor named in the Lease, any assignee of Lessor, whether by outright assignment, assignment for security or otherwise. Lessor may without Guarantor's consent assign this Guaranty, voluntarily or by operaƟon of law. This Guaranty appliesto, inures to the benefit of, and binds all persons that comprise Guarantor, their heirs, devisees, legatees, executors, administrators, representaƟves, successors and assigns.
Signatures to this Guaranty accomplished by means of electronic signature or similar technology shall be legal and binding. This Guaranty may be executed in counterparts.
Guarantor is advised to seek advice of legal counsel before signing this Guaranty. Guarantor acknowledges that AIR CRE, the real estate brokers or their agents or employees have not made any representaƟon or statement as to the legal sufficiency or effect or tax consequences of this Guaranty or the Lease.
GUARANTOR
Gary Ward
Executed At:
On:
By:
Name Printed:
Title:
Address:
Email Address:
By:
Name Printed:
Title:
Address:
Email Address:
AIR CRE * hƩps://www.aircre.com * 213-687-8777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.
RULES AND REGULATIONS FOR
STANDARD OFFICE LEASE
Date: 6/11/2024
By and Between
Lessor: The city of San Clemente
Lessee: Trestles Property Management, LLC
Property Address: 1100 N. El Camino Real, San Clemente Ca 92672 (street address, city, state, zip)
GENERAL RULES
1. Lessee shall not suffer or permit the obstrucƟon of any Common Areas, including driveways, walkways and stairways.
2. Lessor reserves the right to refuse access to any persons Lessor in good faith judges to be a threat to the safety and reputaƟon of the Project and its occupants.
3. Lessee shall not make or permit any noise or odors that annoy or interfere with other lessees or persons having business within the Project.
4. Lessee shall not keep animals or birds within the Project, and shall not bring bicycles, motorcycles or other vehicles into areas not designated as authorized for same.
5. Lessee shall not make, suffer or permit liƩer except in appropriate receptacles for that purpose.
6. Lessee shall not alter any lock or install new or addiƟonal locks or bolts.
7. Lessee shall be responsible for the inappropriate use of any toilet rooms, plumbing or other uƟliƟes. No foreign substances of any kind are to be inserted therein.
8. Lessee shall not deface the walls, parƟƟons or other surfaces of the Premises or Project.
9. Lessee shall not suffer or permit anything in or around the Premises or Building that causes excessive vibraƟon or floor loading in any part of the Project.
10. Furniture, significant freight and equipment shall be moved into or out of the building only with the Lessor's knowledge and consent, and subject to such reasonable limitaƟons, techniques and Ɵming, as may be designated by Lessor. Lessee shall be responsible for any damage to the Office Building Project arising from any such acƟvity.
11. Lessee shall not employ any service or contractor for services or work to be performed in the Building, except as approved by Lessor.
12. Lessor reservesthe right to close and lock the Building on Saturdays, Sundays and Building Holidays, and on other days between the hours of 9 P.M. and 5 A.M. of the following day. If Lessee usesthe Premises during such periods, Lessee shall be responsible for securely locking any doors it may have opened for entry.
13. Lessee shall return all keys at the terminaƟon of its tenancy and shall be responsible for the cost of replacing any keys that are lost.
14. No window coverings, shades or awnings shall be installed or used by Lessee.
15. No Lessee, employee or invitee shall go upon the roof of the Building.
16. Lessee shall not suffer or permit smoking or carrying of lighted cigars or cigareƩes in areas reasonably designated by Lessor or by applicable governmental agencies as non-smoking areas.
17. Lessee shall not use any method of heaƟng or air condiƟoning other than as provided by Lessor.
18. Lessee shall not install, maintain or operate any vending machines upon the Premises without Lessor's wriƩen consent.
19. The Premises shall not be used for lodging or manufacturing, cooking or food preparaƟon.
20. Lessee shall comply with all safety, fire protecƟon and evacuaƟon regulaƟons established by Lessor or any applicable governmental agency.
21. Lessor reservesthe right to waive any one of these rules orregulaƟons, and/or as to any parƟcular Lessee, and any such waiver shall not consƟtute a waiver of any other rule or regulaƟon or any subsequent applicaƟon thereof to such Lessee.
22. Lessee assumes all risksfrom theŌ or vandalism and agrees to keep its Premises locked as may be required.
23. Lessor reservesthe right to make such other reasonable rules and regulaƟons as it may from Ɵme to Ɵme deem necessary for the appropriate operaƟon and safety of the Project and its occupants. Lessee agreesto abide by these and such rules and regulaƟons.
PARKING RULES
1. Parking areas shall be used only for parking by vehicles no longer than full size, passenger automobiles herein called "PermiƩed Size Vehicles." Vehicles other than PermiƩed Size Vehicles are herein referred to as "Oversized Vehicles."
2. Lessee shall not permit or allow any vehicles that belong to or are controlled by Lessee or Lessee's employees,suppliers, shippers, customers, or invitees to be loaded, unloaded, or parked in areas other than those designated by Lessor for such acƟviƟes.
3. Parking sƟckers or idenƟficaƟon devicesshall be the property of Lessor and be returned to Lessor by the holder thereof upon terminaƟon of the holder's parking privileges. Lessee will pay such replacement charge as isreasonably established by Lessor for the loss ofsuch devices.
4. Lessor reserves the right to refuse the sale of monthly idenƟficaƟon devices to any person or enƟty that willfully refuses to comply with the applicable rules, regulaƟons, laws and/or agreements.
5. Lessor reserves the right to relocate all or a part of parking spaces from floorto floor, within one floor, and/or to reasonably adjacent offsite locaƟon(s), and to reasonably allocate them between compact and standard size spaces, as long as the same complies with applicable laws, ordinances and regulaƟons.
6. Users of the parking area will obey all posted signs and park only in the areas designated for vehicle parking.
7. Unless otherwise instructed, every person using the parking area isrequired to park and lock his own vehicle. Lessor will not be responsible for any damage to vehicles, injury to persons or loss of property, all of which risks are assumed by the party using the parking area.
8. ValidaƟon, if established, will be permissible only by such method or methods as Lessor and/or itslicensee may establish at rates generally applicable to visitor parking.
9. The maintenance, washing, waxing or cleaning of vehicles in the parking structure or Common Areasis prohibited.
10. Lessee shall be responsible for seeing that all of its employees, agents and invitees comply with the applicable parking rules, regulaƟons, laws and agreements.
11. Lessorreserves the right to modify these rules and/or adopt such other reasonable and non-discriminatory rules and regulaƟons as it may deem necessary for the proper operaƟon of the parking area.
12. Such parking use as is herein provided isintended merely as a license only and no bailment isintended orshall be created hereby.
AIR CRE * hƩps://www.aircre.com * 213-687-8777 * [email protected] NOTICE: No part of these works may be reproduced in any form without permission in wriƟng.