G. Following negotiations between the Parties and Syar concerning the Syar Complaint, the Parties entered into that certain Settlement and Release Agreement with Syar, which was approved by the City Council for City by Resolution 22-136 N.C. adopted July 12, 2022, a true and correct copy of which is appended to this Agreement as Exhibit B, and is incorporated herein by this reference (“Syar Agreement”). Relevant here, the Syar Agreement requires the City and BRS to undertake certain additional actions as set forth in the Syar Agreement, including without limitation recording a Collaborative Use Easement on certain portions of the City Property identified in the Syar Agreement as set forth in the Syar Agreement (“Collaborative Use Easement”). In addition, a land plan (“Land Plan”) was developed, and is appended to the Syar Agreement.
H. As of the date of this Agreement, the current 8 th Amendment to the ERN expires December 29, 2022.
I. The Parties now intend to establish the terms on which the City will sell and BRS will purchase a portion of the City Property which consists of a portion of each of Solano County Assessor’s Parcel No. (“APN”) 0081-040-100, 0081-040-880, 0081-191-010, 0081-040-110, and 0181- 190-010, including: (1) all rights, easements and appurtenances belonging or appurtenant thereto; and (2) all existing improvements located thereon, as more fully described in Exhibit C -1 through C-3 to this Agreement and incorporated herein by this reference (“Subject Property”).
NOW, THEREFORE, in consideration of the foregoing, and the mutual promises and covenants contained in this Agreement, the receipt and adequacy of which is acknowledged, the Parties agree as follows:
AGREEMENT
The Recitals set forth in the introductory paragraphs of this Agreement constitute a material part of this Agreement, and are fully incorporated herein by this reference, as if set forth in their entirety.
1. Effective Date . The Parties acknowledge that Ci ty’s ability to enter into this Agreement is contingent upon the enactment of a resolution by the City Council approving this Agreement. Accordingly, as used herein, the term “Effective Date” shall mean the latter of the date on which and this Agreement (a) has been executed by both Parties, and (b) the resolution(s) adopted by the City Council approving and authorizing this Agreement, shall become final and effective.
2. Purchase and Sale . City agrees to sell and BRS agrees to purchase the Subject Property, including without limitation all rights, easements and appurtenances belonging or appurtenant thereto, on the terms and conditions stated in this Agreement. For the avoidance of doubt, the Subject Property does not include (a) personal property used in the operation of a golf course on the Subject Property, (b) intellectual property in connection with such operations, (c) rights to select an operator for the golf course on the balance of the City Property, or (d) water and water rights, including both riparian and appropriative rights, in connection with the operation of the golf course; or (e) other property rights in connection with the City’s conduct of golf -related activities on the Subject Property.
3. Consideration to City.
a. Payment of Negotiation Fee. City previously received the Negotiation Fee from BRS in the total sum of One Hundred Thousand Dollars ($100,000.00), as provided by the ERN.
The Negotiation Fee is non-refundable to BRS and has been used to cover the costs associated with the negotiation of the ERN.
b. City Cost Security Deposit . In addition to the Negotiation Fee, BRS posted the sum of Fifty Thousand Dollars ($50,000 .00), as provided by the ERN (“ City Cost Security Deposit”) to fund payment of City Costs, as defined by the ERN. The City Cost Security Deposit is non-refundable to BRS and has been used to cover the costs of negotiation of this Agreement.
c. Purchase Deposit. Within three (3) days after the Effective Date, BR S shall deliver into Escrow (as hereinafter defined) with the Escrow Holder a deposit in the sum of One Hundred Fifty Thousand Dollars ($150,000.00) in cashier’s check or by confirmed wire transfer of good and available funds (“Purchase Deposit”). The Purchase Deposit shall be placed in an interest- bearing account, shall be refundable to Buyer (except for the Nonrefundable Consideration Payment and Appraisal Fees), and shall be applied to the Purchase Price at Closing. City requested that BRS fund the cos t of an appraisal of other City property, i.e., 400 Mare Island Way, Vallejo, California (“400 Mare Island”), in connection with its request that the Subject Property be released from certain loan obligations for which the Subject Property was pledged as security (“Loan Obligations”). To the extent that BRS funds the cost of the appraisal for 400 Mare Island, BRS may deduct the cost of the 400 Mare Island appraisal from the amount of the Purchase Deposit deposited with Escrow Holder. The full amount of the Purchase Deposit (i.e., $150,000) shall nonetheless be credited toward the Purchase Price.
d. Independent Consideration . Immediately upon receipt of the Purchase Deposit, Escrow Holder shall release a “ Nonrefundable Consideration Payment,” in the amount of One Thousand Dollars ($ 1,000.00) to City without further instructions from City or BRS. The Nonrefundable Consideration Payment is paid to City in consideration for City granting BRS the right to purchase the Subject Property and to conduct due diligence as a contingency in accordance with the terms and conditions of this Agreement. Notwithstanding anything to the contrary contained in this Agreement, in no event shall the Nonrefundable Consideration Payment be refundable; however, the Nonrefundable Consideration Payment shall be applicable to the Purchase Price at Closing.
e. Purchase Price.
i. The Purchase Price for the Property is and shall be the fair market value of the Property in its as -is-where-is condition, as is determined by an MAI -certified appraiser with at least ten (10) years of experience appraising comparable unimproved real property in Solano County, California (“Qualified Appraiser”).
ii. The Qualified Appraiser shall be instructed to appraise the Property for uses then allowed und er then applicable laws and entitlements (without taking into account any prospective future uses or prospective value attributable to prospective entitlements and development rights that may thereafter be issued by any governmental or quasi-governmental entity, and assigning no value to the existing golf course operations of the Property ). The appraisal shall recognize this
purchase as a “bulk” land sale. Further, no value shall be attributed to any portion of the Property lying within the Columbus Parkw ay right of way including, easements for streets, sidewalks, curb, gutter and/or existing easements which prohibit or restrict the use of the Property excluding therefrom the Collaborative Use Agreement.
iii. BRS shall have no obligation to purchase the Subjec t Property unless and until an appraisal of the Subject Property establishes the Purchase Price, and the Purchase Price is approved by BRS and City, each in its sole and absolute discretion. Each Party shall approve or disapprove the Purchase Price, in writing, within three (3) business days after its receipt of the appraisal which establishes the Purchase Price.
iv. City shall appoint the Qualified Appraiser . All fees associated with obtaining the appraisal (“Appraisal Fees”) shall be funded by BRS, which shall be non-refundable to BRS and shall not be applicable to the Purchase Price at Closing (as opposed to the costs to appraise 400 Mare Island), which are the subject of Section 3(c) of this Agreement.
v. After approval of the Purchase Price by eac h of the Parties, and prior to the Closing Date, BRS shall deposit the balance of the Purchase Price in Escrow as provided by Section 10(b)(i), together with all other funds necessary on the part of BRS to enable Escrow Agent to comply with these instructions (see Sections 12 and 13) (“Closing Funds”).
4. Escrow. The Parties have opened escrow with First American Title Company, Northern California Homebuilder Services, c/o Tammi Buna, Senior Escrow Officer, 4750 Willow Road, Suite 275, Pleasanton, CA 94588, Escrow No. 0131-622619ala (“Escrow Agent”).
5. Limited Pre-Closing Investigation of the Property. During the period starting on the Effective Date and continuing through the Closing Date, BRS shall have the right to conduct limited physical inspections of the Subject Property and receive certain limited disclosures from City, as provided below.
a. Environmental Investigation . BRS previously obtained a Phase I environmental site assessment for the Subject Property (“Environmental Report”). BRS shall have a right to enter onto the Subject Property with reasonable advance notice to City, for purposes of obtaining an update to the Environmental Report and conducting such follow-up investigation as may be reasonable and necessary for BRS to evaluate the Subject P roperty’s environmental condition in manner sufficient to satisfy the “All Appropriate Inquiries” rule established by the Environmental Protection Agency. See 40 CFR Part 312, et seq.
b. Natural Hazard Disclosure . City may be required under California law to disclose if the Property lies within the following natural hazard areas or zones: (i) a special flood hazard area designated by the Federal Emergency Management Agency (California Civil Code Section 1102.17); ( ii) an area of potential flooding (Californ ia Government Code Section 8589.4); (iii) a very high fire hazard severity zone (California Government Code Section 51183.5); ( iv) a wild land area that may contain substantial forest fire risks and hazards (Public Resources Code Section 4136); (v) an earthquake fault zone (Public Resources Code Section 2621.9); or ( vi) a seismic hazard zone (Public Resources Code Section 2694). On or about November 3, 2022, BRS obtained a Natural Hazards Disclosure Statement concerning the Property issued by JCP -LGS, which Natural
Hazards Disclosure Statement shall and hereby does satisfy City’s compliance with the above -stated obligations. BRS hereby acknowledges receipt the Natural Hazards Disclosure Statement.
c. Title and Survey.
i. Preliminary Title Report. Prior to the Effective Date, BRS requested that First American Title Insurance Company (“ Title Company ”) issue a preliminary title report pertaining to the Subject Property, together with complete and legible copies of all documents relating to the title exceptions and other matters referred to in such preliminary title report (collectively, the “Preliminary Title Report”). The Preliminary Title Report shall provide for issuance of an owner’s policy of title insurance to BRS using an ALTA Policy Form 2021 or on such other form as BRS may require in its sole and absolute discretion, in the full amount of the Purchase Price, subject only to the Permitted Exceptions (defined below) (“Owner’s Title Policy”).
A. Within two (2) business days after the Effective Date , BRS shall notify City in writing (“ Title Objection Notice ”) of any title exceptions identified in the Preliminary Title Report and/or Survey that BRS disapproves in its sole and absolute discretion (“Title Objection”).
B. BRS hereby disapproves all deeds of trust, de linquent payments of taxes and assessments and other monetary liens affecting the Subject Property that accrued prior to Closing (other than liens for non -delinquent property taxes and assessments as described above) (“ Monetary Exceptions ”). City hereby c ovenants to cause all such Monetary Exceptions to be satisfied at City’s sole cost and expense (including all prepayment penalties and charges) before or concurrently with the Close of Escrow from sales proceeds or otherwise.
Notwithstanding the above, City and BRS acknowledge that the Subject Property is pledged as security for Loan Obligations to Union Bank of California, N.A., a national banking association organized an existing under the laws of the United States of American, as trustee (for convenience, “Union Bank”).
City shall exercise its best efforts to cause the release of the Subject Property from the Loan Obligations prior to Closing. In the event that City is unable to do so, the Loan Obligations shall become the subject of Section 6 of this Agreement, and its failure to secure the release the Loan Obligations shall not be deemed a pre-closing default within the meaning of Section 16.
C. Any exception to coverage shown on the Preliminary Title Report, or matter that is not listed as a Title Obje ction in the BRS’ Title Objection Notice will be deemed approved by BRS and shall constitute a “Permitted Exception” hereunder.
D. City shall have a period of two (2) business days following its receipt of the Title Objection Notice within which to notify BRS in writing (“ Title Objection Response”) of its agreement to remove, alter, modify or otherwise mitigate any Title Objection to the satisfaction of BRS. City’s failure to timely provide a Title Objection Response will be deemed an election by City not to cure the Title Objections prior to the Close of Escrow. In the event that City is not willing to remove, alter, modify or otherwise mitigate any Title Objection to the satisfaction of BRS, BRS shall elect within two (2) business days after the City’s Title Objection Response was due to (1) waive its disapproval of such exception, in which case such exception shall then be deemed to be a Permitted Exception, or (2) terminate its obligation to purchase the Subject Property.
ii. Survey. BRS shall obtain a boundary survey for the Subject Property (“Survey”) prepared by as surveyor and/or engineer selected by BRS in its sole discretion, provided that BRS shall pay for the cost of such Survey and provide City and the Title Company with copies of such Survey. The surveyor and/engineer shall prepare a metes and bounds legal description that will identify the Real Subject Property for purposes of the Title Policy, Grant Deed, and Rescission Deed (all as defined herein ). The Survey and legal description shall be subject to the approval of the City Manager and the City Attorney, and such approval shall be and hereby is a condition of Closing.
d. Golf Lease. Prior to Closing, City and BRS shall negotiate and execute a lease agreement (“Golf Lease”), which shall commence at the Close of Escrow, pursuant to which City shall continue to hold possession of the Subject Property and operate the golf course and attendant facilities thereon. The Golf Lease shall include commercially reasonable insurance and indemnity requirements for similar leases, in favor of BRS.
In the event that (i) each of the Parties does not approve the Purchase Price, or (ii) BRS terminates the Agreement prior to the Closing Date due to a condition identified in the Environmental Report or Natural Hazards Disclosure Statement; due to a title or survey defect ; or due to the failure of the Parties to timely enter into the Golf Lease ; the Purchase Deposit shall be refunded to BRS, less the Nonrefundable Consideration Payment, Appraisal Fees, and any amounts due to Escrow Agent from BRS pursuant to this Agreement. City shall promptly (but no longer than two (2) business days after such termination) execute any instructions required by Escrow Agent in order to release the Purchase Deposit. Upon BRS’ termination or deemed termination of this Agreement under this Section 5, neither party shall have any further liability under this Agreement or under the ERN, except for any obligations that are specifically stated to survive the termination of this Agreement (the “ Surviving Obligations”).
6. Post-Closing Obligations . The Parties intend that certain activities must be performed after Closing, to confirm the sale of the Subject Property and to realize the development of the Subject Property by BRS if and as ultimately approved by the City in the normal course of entitlement and permitting review. Accordingly, the Parties shall undertake the following activities after Closing, reasonably and in good faith, which obligations shall survive the close of escrow.
a. Release of Subject Property from Loan Obligations.
i. In the event that City is unable to obtain the release of the Subject Property from the Loan Obligations prior t o Closing, as contemplated by Section 5(c)(1)(B), that failure shall not be deemed a pre -closing default within the meaning of Section 16. City shall have fifteen (15) business days after Closing , subject to a written agreement executed by both Parties extending such deadline, to secure such release by the recording of such documents as Title Company requires to remove the Loan Obligations as Monetary Exceptions to the Title Policy (“Union Bank Documents”), so that the Title Policy may be re-issued to BRS free from such Monetary Exceptions.
Commencement of the Due Diligence Period established by Section 6(e) shall be postponed until the date when the Union Bank Documents are recorded in the Official Records of Solano County (“Official Records”).
ii. To the extent that that the Union Bank Documents do not record within fifteen (15) days after Closing, as such date may be extended from time -to-time, Rescission shall occur within the meaning of and as provided in Section 7.
b. Continued Operation of Golf Course. City shall continue to operate the golf course and attendant facilities on the Subject Property pursuant to the Golf Lease. For the avoidance of doubt, City shall be permitted to continue golf operations on the Subject Property after the Close of Escrow, and may continue to conduct such operations through Touchstone or any other management company that City may choose in its reasonable discretion.
c. Reimbursement Agreement.
i. Within sixty (60) days after Closing, subject to a written agreement executed by both Parties extending such deadline, the Parties shall negotiate and execute an agreement to provide for BRS’ payment of City’s reasonable costs associated with the engagement of City Staff (if not subject to flat rate entitlement fees), third-party consultants and attorneys, including City’s legal counsel (outside or staff), contract project manager, and financial and engineering consultants, in connection with the review and processing of the BRS Applications, and, to the extent City’s involvement is necessary or desirable to BRS, the permits from resource agencies (“Reimbursement Agreement”).
ii. The Reimbursement Agreement shall be in the City’s usual form and will provide for an “evergreen deposit” of One Hundred Thousand and 00/100 Dollars ($100,000.00) to secure BRS’ obligations to pay such costs. The Parties contemplate that BRS’ first payment of costs due to City under the Reimbursement Agreement shall be payable no earlier than the latter of the following dates: (A) sixty (60) calendar days af ter Closing, (B) ninety (90) days prior to submittal of development applications by BRS.
iii. In the event that City and BRS are not able to timely negotiate and execute a Reimbursement Agreement, Rescission shall occur within the meaning of and as provided in Section 7.
d. Participation Agreement.
i. No later than one hundred twenty (120) days after closing, subject to a written agreement executed by both Parties extending such deadline, the Parties shall negotiate and execute a Participation Agreement by which the City will receive (A) additional consideration for the Subject Property after BRS’ receipt of final entitlements for a project on the Subject Property; and (B) additional consideration for the Subject Property at such time as (1) finished lots are sold to merchant builders for construction, or (2) BRS sells the improved residential and/or commercial property.
ii. In the event that City and BRS are not able to timely negotiate and execute a Participation Agreement, Rescission shall occur within the meaning of and as provided in Section 7.
e. Conduct of Due Diligence; Physical Inspections.
i. BRS shall have the opportunity to perform due diligence investigations after Close of Escrow, which investigations may include (A) a review of all the documents, materials
or information relating to the Subject Property, including without limitation those described on Exhibit D attached hereto and incorporated herein by this reference (collectively, the “Due Diligence Materials”), which shall be provided to BRS no later than fifteen (15) calendar days after Close of Escrow; and (B) a review of the physical condition of the Subject Property, including without limitation investigations, and tests of the Subject Property, including but no t limited to, geotechnical soil borings, test pits, physical inspections and other environmental tests of the Subject Property (“Physical Inspections”), all at BRS’ sole risk, cost, and expense.
ii. BRS shall complete its review of the Due Diligence Materials within forty-five (45) days after City delivers the Due Diligence Materials and shall complete its Physical Inspections within sixty (60) days after Close of Escrow (“Due Diligence Period”).
iii. At the conclusion of the Due Diligence Period, BRS shall notify the City in writing as to whether it approves the Subject Property and intends to retain title (“ Approval Notice”), or if it disapproves the Subject Property (“ Disapproval Notice”). For the avoidance of doubt, BRS shall not issue a Disapproval Not ice unless the Due Diligence Materials or Physical Inspections disclose conditions that B RS determines will materially impact B RS’s intended use and development of the Subject Property and or the value of the Subject Property.
iv. If BRS issues a Disapproval Notice,, Rescission shall occur within the meaning of and as provided in Section 7. The failure by BRS to deliver its Disapproval Notice shall be deemed to be its approval of the Subject Property.
v. In the event BRS terminates this Agreement and exercises the right of Rescission, BRS shall return all Due Diligence Materials provided by City to BRS and shall permanently delete any electronic copies held by BRS.
f. Performance Agreement; Pursuit of Entitlements by BRS.
i. Within one hundred twenty (120) after Closing, subject to a written agreement executed by both Parties extending such deadline, City and BRS shall negotiate and execute an agreement that includes a performance schedule pursuant to which BRS shall proceed with filing those applications and submittals that are and will be necessary to secure issuance of entitlements to develop the Subject Property (“ Performance Agreement ”). The Performance Agreement shall provide that (A) the requested entitlements shall be consistent with the limitations impose d on the development of the Subject Property by the Syar Agreement; and that (B) entitlements for the Subject Property shall be pursued in an expeditious manner, with reasonable diligence, and on a timeline that is generally consistent with the performance schedule, market conditions, and other similar factors, and the goal of completing expeditious development of the Subject Property, subject to force majeure, which shall be defined in the Performance Agreement.
ii. The Performance Agreement (or alternate for m of agreement, as the Parties may agree) shall provide that the City shall have a power of termination (a reversionary interest) in the Subject Property (“Power of Termination”) as provided in Section 7(e).
iii. The Performance Agreement (or alternate form of agreement, as the Parties may agree) shall provide that if the BRS Applications are not approved, and BRS is not able to
secure entitlements for a project, the nature of which project, shall be within BRS’ sole and absolute discretion, BRS shall have the right to require the City to repurchase the Subject Property by refunding to BRS the Purchase Price (inclusive of the Purchase Deposit and any unexpended amounts pursuant to the Reimbursement Agreement, but exclusive of the Nonrefundable Consideration and Appraisal Fees) in consideration for BRS reconveying the Subject Property to the City.
iv. Following execution of the Performance Agreement, a Memorandum of Agreement shall be recorded on title to the Subject Pr operty to assure that the City’s Power of Termination is recorded in the chain of title for the Subject Property.
v. BRS shall engage Norman, at its sole cost and expense, to develop a Conceptual Golf Site Design and Upgrade package (“ Concept Plan”). Norman shall also prepare a construction estimate for the implementation of the Concept Plan. The Concept Plan shall be consistent with the limitations imposed on the development of the City Property by the Syar Agreement and any cost limitation imposed by City. City shall have the right to approve the cost and scope to develop the Concept Plan. Upon City approval of the cost and scope to develop the Concept Plan, BRS shall within thirty (30) days of approval of the cost and scope prepare and submit to the City the Concept Plan. Upon approval of the Concept Plan by City, and concurrently with submittal of the BRS Applications, BRS shall submit plans sufficient to permit (1) CEQA review of and approval of designs for the Golf Site design and upgrade; (2) the pursuit of entitlements (i.e., the Concept Plan shall include sufficient detail to permit the submittal of a development application and pursuit of entitlements, and shall include a site layout and grading plan , among other requirements ); (3) an updated construction estimate for same; ( 4) allow the City or City Designee to obtain construction bids for the Golf Site design and upgrade. For the avoidance of doubt, BRS is not obligated to provide construction-level detail in the Concept Plan.
vi. In the event that City and BRS are not able to timely negotiate and execute a Performance Agreement, Rescission shall occur within the meaning of and as provided in Section 7.
vii. BRS may request that City enter into a development agreement in connection with its pursuit of entitlement applications for the Subject Property, which shall be considered by the City in the normal course of processing for such applications.
g. CEQA Compliance. In compliance with CEQA, and to give members of the public the opportunity to be aware of the environmental consequences of a development project on the Subject Property, and to fully participate in the CEQA process, the Parties acknowledge that City has no obligation to approve a development project on the Subject Property and that any such project shall be subject to all applicable governmental approvals . City shall retain discretion in accordance with applicable law before action on the project by the City Council to (i) identify and impose mitigation measures to mitigate significant envir onmental impacts, (ii) select other feasible alternatives to avoid significant environmental impacts, (iii) balance the benefits of the project against any significant environmental impacts prior to taking final action if such significant impacts cannot otherwise be avoided, or (iv) determine not to proceed with the project. Any failure by City Council to grant such approvals after a public hearing thereon shall not constitute a default or a breach of the terms of this Agreement by City.
7. Rescission; Power of Termination.
a. In the event that the Union Bank Documents are not recorded as required by Section 6(a); if the Parties are not able to timely reach agreement on the Reimbursement Agreement, Participation Agreement, Performance Agreement, or if BRS issues a Disapproval Notice at the conclusion of the Due Diligence Period , the conveyance of the Subject Property to BRS shall be rescinded (“Rescission”).
b. In the event of Rescission, (i) BRS shall receive the return of the Purchase Deposit (less the Nonrefundable Consideration Payment and Appraisal Fees) and the Purchase Price, together with and any unexpended amounts pursuant to the Reimbursement Agreement; (ii) the Parties shall execute and record a deed rescinding BRS’ acquisition of the Subject Property. (“Rescission Deed”).
c. For the avoidance of doubt, BRS shall not have a right of Rescission in connection with its pursuit of entitlements for the project, with CEQA, any development agreement, or with the City’s pursuit of development of golf or other improvements on that portion of the City Property retained by City.
d. In the event of Rescission, BRS shall not be entitled to reimbursement of any amounts expended pursuant to the Negotiation Fee, the City Cost Security Deposit, the Reimbursement Agreement, Performance Agreement or any costs associated with the processing of the BRS Applications.
e. In the event that BRS fails to comply with the Performance Agreement, the City may exercise the Power of T ermination under the Performance Agreement (Cal. Civ.
Code § 885.010, et seq.), in which case fee ownership of the Subject Property shall be returned to the City and BRS shall receive the return of the Purchase Price and such other sums as the Parties negotiate in the Performance Agreement.
8. Conditions Precedent . The following shall be the conditions precedent to the applicable Party’s obligations to consummate the purchase and sale transaction contemplated herein:
a. Conditions to BRS’ Obligations . BRS’ obligations hereunder, including, but not limited to, its obligation to consummate the purchase transaction provided for herein, are subject to the satisfaction, in BRS’ sole and absolute discretion, of each of the following conditions, each of which is for the sole benefit of BRS and may only be waived by BRS in writing:
i. City’s Representations and Warranties . Each representation and warranty made in this Agreement by City shall be true and correct in all material respects at the time as of which the same is made and as of the Close of Escrow.
ii. Purchase Price. The Purchase shall have been established and approved by BRS and City.
iii. Approval of Legal Description . The legal description pursuant to which the Subject Property shall be conveyed to BRS shall have been approved by BRS and City.
iv. Delivery of the Golf Lease. A fully executed copy of the Golf Lease shall have been delivered to Escrow by City.
v. Owner’s Title Policy. Title Company shall be irrevocably committed to issue, at the Closing, its standard coverage owner’s title insurance policy (and provided BRS provides the Survey to the Title Company (in a form that meets the Title Company’s reasonable requirements), its extended coverage ALTA Owner’s Title Insurance Policy ( 2021 Form), with liability equal to the Purchase Price, or in such greater amount as BRS may request and to which Title Company may agree to underwrite, showing fee title to the Subject Property vested in BRS, free and clear of any and all tenancies and/or occupancy rights of third parties affecting all or any portion of the Subject Property, with the limited exception of the existing lease to Touchstone, and subject only to the Permitted Exceptions (the “Owner’s Title Policy”).
vi. City Deliveries. City shall have delivered to Escrow Ag ent the items described in Section 10(a) hereof.
vii. No Pending Action . There shall exist no pending actions, suits, arbitrations, proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings, against City that would materially and adversely affect City’s ability to perform its obligations under this Agreement.
viii. Condemnation. This Agreement shall not have been terminated by BRS as a result of any condemnation or threatened condemnation of the Subject P roperty as described in Sections 14(a)(vi) and 15 hereof.
ix. BRS’ Waiver of Conditions. BRS may at any time or times on or before the Close of Escrow, at its sole election, waive any of the conditions precedent to BRS’ obligations under this Section 8(a) or otherwise and consummate the sale, but any such waiver shall be effective only if contained in a writing signed by BRS and delivered to City. In the event any of the conditions precedent for the benefit of BRS that are contained in this Agreement are not completely fulfilled and satisfied, then in addition to any other rights or remedies BRS may have, BRS may, prior to the Closing Date (defined below), terminate its obligation to purchase the Subject Property, and (A) the Purchase Deposit and all accrued interest thereon shall immediately refunded to BRS (less the Nonrefundable Consideration Payment and Appraisal Fees and any amounts due to Escrow Agent from BRS pursuant to this Agreement); (B) BRS’ obligation to purchase, and City’s obligation to sell, the Subject Property shall terminate; and (C) neither Party shall have any further obligation to the other except , except as to the Surviving Obligations. Any unexpended amounts pursuant to the Reimbursement Agreement shall be returned to BRS by City outside of Escrow.
b. Conditions to City’s Obligations. City’s obligations hereunder, including, but not limited to, its obligation to consummate the purchase transaction provided for herein, are subject to the satisfaction, in City’s sole and absolute discretion, of each of the following conditions, each of which is for the sole benefit of City and may be waived by City in writing:
i. Purchase Price. The Purchase shall have been established and approved by BRS and City.
ii. Approval of Legal Description . T he legal description pursuant to which the Subject Property shall be conveyed to BRS shall have been approved by BRS and City.
iii. Delivery of the Golf Lease. A fully executed copy of the Golf Lease shall have been delivered to Escrow by BRS.
iv. BRS Deliveries. BRS shall have delivered to Escrow Agent the items required to be delivered by BRS pursuant to Section 10(b).
v. Due Performance. BRS shall not be in default under this Agreement and shall have duly performed each and every covenant, undertaking and agreement to be performed by it prior to the Close of Escrow hereunder.
vi. BRS’ Representations and Warranties . Each representation and warranty made in this Agreement by BRS shall be true and correct in all material respects at the time as of which the same is made and as of the Close of Escrow.
vii. City’s Waiver of Conditions. City may at any time or times on or before the Close of Escrow, at its sole election, waive any of the conditions precedent to City’s obligations under this Section 8(b) or otherwise and consummate the sale, but any such waiver shall be effective only if contained in a writing signed by City and delivered to BRS. In the event any of the conditions precedent for the benefit of City that are contained in this Agreement are not completely fulfilled and satisfied, then in addition to any other rights or remedies City may have, City may, prior to the Closing, terminate its obligation to convey the Subject Property, and the Purchase Deposit and all accrued interest thereon shall immediately r efunded to BRS, less the Nonrefundable Consideration Payment and Appraisal Fees, and any amounts due to Escrow Holder from BRS pursuant to this Agreement, BRS’ obligation to purchase, and City’s obligation to sell, the Subject Property shall terminate, and neither Party shall have any further obligation to the other except as otherwise provided in this Agreement. Any unexpended amounts pursuant to the Reimbursement Agreement shall be returned to BRS by City outside of Escrow.
9. Covenants During Escrow. From the Effective Date until the earlier of the Closing or the termination by BRS or City of its obligation to complete the transfer of the Subject Property, BRS and City, as applicable, covenant and agree to the following:
a. Operation of the Subject Property Prior to Close of Escrow.
i. Affirmative Covenants. City shall (A) pay all taxes and assessments, and service all debt secured by the Subject Property, if any, prior to delinquency, (B) maintain and operate the Subject Property in substantially its current condition, and (C) maintain property and liability insurance related to the Subject Property at the level and with the insurance companies that City currently maintains.
ii. Negative Covenants. Following BRS’ delivery of an executed copy of this Agreement, City shall not, except as otherwise specifically permitted or required pursuant to this Agreement, or as otherwise agreed or permitted by BRS in writing in BRS’ sole and absolute discretion, (A) grant, create or allow the creation of any easement, right -of-way, encumbrance, lien, restriction,
right of occupancy or assessment affecting the Subject Property or otherwise cause or permit any other change to the state of title with respect to the Subject Property, (B) amend, extend or otherwise modify the terms of any existing lease, easement, right -of-way, encumbrance, lien, restriction or assessment that affects the Subject Property (except as may be necessary to release the Subject Property from any existing mortgage obligation), (C) sell, transfer or otherwise convey or terminate, amend or otherwise modify any Intangible Property relating exclusively to the Subject Property, (D) enter into any further or amend any existing agreements, contracts, leases or rights of occupancy with respect to the Subject Property, with the exception of the Touchstone Agreement or any other Agreement relating to the operation of the Golf Course, (E) cause or permit any Hazardous Materials (as defined in Section 14(a)( viii) below) to be used, stored, released, discharged or generated on the Subject Property in violation of applicable law, or (F) cause or permit any material changes to the physical condition of the Subject Property.
b. City Contracts. With the exception of City’s agreement with Touchstone, City shall cause any and all charges, fees, costs or expenses that have accrued under any contracts or agreements relating exclusively to the Subject Property to which City is a party (“ Contracts”) to be paid in full and te rminated on or prior to the Close of Escrow. This Section 9(b) shall survive the Close of Escrow.
10. Closing Deliverables.
a. City’s Closing Deliveries . Not less than one (1) business day prior to the Closing Date, City shall deliver or cause to be delivered to Escrow Agent the following items:
i. The amount of Closing Costs and Prorations allocated to City, as provided by Sections 12 and 13;
ii. One (1) fully executed and acknowledged grant deed conveying the Real Subject Property in substantially the form attached hereto as Exhibit E (“Grant Deed”);
iii. A Certificate of Non -Foreign Status duly executed by City certifying that City is not a “foreign person” within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, together with the equivalent California form (Form 593) confirming that City is not subject to withholding of any portion of the Purchase Price by BRS pursua nt to the California Revenue & Taxation Code (collectively, the “Non-Foreign Affidavits”);
iv. One (1) fully executed original of a general assignment agreement (the “General Assignment”) conveying to BRS the Intangible Property in the substantially form attached hereto as Exhibit F.
v. One(1) fully executed original of the Golf Lease; and
vi. Any other document, instrument or agreement necessary to consummate the transactions contemplated herein reasonably requested by BRS or Escrow Agent.
b. BRS’ Closing Deliveries. On or prior to the Closing Date, BRS shall deliver to Escrow Agent the following items:
i. The Closing Funds;
ii. One(1) fully executed original of the Golf Lease;
iii. One (1) fully executed Collaborative Use Easement as required by the Syar Agreement, in recordable form;
iv. One (1) fully executed original of the Preliminary Change of Ownership Report (“PCOR”);
v. One (1) fully executed original of the Transfer Tax Information Statement; and
vi. Any other documents, instruments or agreements necessary to consummate the transactions contemplated herein reasonably requested by City or Escrow Agent.
11. Escrow and Closing.
a. Escrow Instructions. When this Agreement or counterparts hereof shall have been executed by City and BRS and delivered to Escrow Agent, it shall const itute Escrow Agent’s escrow instructions. Any standard form escrow instructions submitted by Escrow Agent or any other clarification or addition to the instructions contained herein shall, when executed by BRS and City, constitute additional escrow instru ctions. In the event of any conflict between such additional instructions and this Agreement, the terms of this Agreement shall prevail.
b. Closing. The “Close of Escrow” or “Closing” means the date on which the Grant Deed conveying title to the Subject Pr operty to BRS is recorded. The Close of Escrow shall occur on or before Wednesday, December 28, 2022 (the “Closing Date”). The Closing Date may be extended by the Parties, but may not be extended beyond Friday, December 30, 2022 (“Outside Closing Date”)”). Any extension of the Outside Closing Date shall be confirmed by the Parties in writing.
c. Close of Escrow. If and when BRS and City have deposited into Escrow the funds and documents required by this Agreement, and all closing conditions have been satisfied or waived by the applicable party, and Title Company is irrevocably committed to issue the Owner’s Policy and Lender’s Policy concurrently with the Close of Escrow, Escrow Holder shall do the following:
i. Record Documents. Cause the following documents to be recorded in the Official Records: (A) Grant Deed, (B) Collaborative Use Easement, and (C) Union Bank Documents (if available).
ii. Deliver to BRS . Immediately upon the recording of the Grant Deed, deliver to BRS: (A) a conformed copy of the Grant Deed and Collaborative Use Easement; (B) the Non-Foreign Affidavits (if required); (C) fully executed originals of the General Assignment; (D) any
funds deposited by BRS, and any interest earned thereon, in excess of the amount required to be paid by BRS hereunder; and (E) the Owner’s Title Policy.
iii. Deliveries to City; Holdback of Purchase Price.
A. Immediately upon the recording of the Grant Deed, deliver to City: a conformed copy of the recorded Grant Deed, Collaborative Use Easement , and the Union Bank Documents (if recorded).
B. Escrow Agent shall retain that portion of the Closing Funds otherwise due to City pursuant to this Agreement (“ Sales Proceeds”) until such time as Escrow Agent is notified by the Parties that the Loan Obligations are released (if not released prior to Close of Escrow) ; the Reimbursement Agreement, Participation Agreement, Performance Schedule are finalized; and BRS issued an Approval Notice at the conclusion of the Due Diligence Period. For the avoidance of doubt, the timelin es established by this Agreement provide that all of the foregoing conditions on the release of the Sales Proceeds to City shall occur approximately one-hundred-twenty one (121) days after Closing ( i.e., the Due Diligence Period expires sixty (60) days after Close of Escrow, and the balance of the conditions on release of the Sales Proceeds shall be satisfied no later than one -hundred-twenty (120) days thereafter) unless amendments of these timelines are agreed to by both Parties in writing. City acknowledges, however, that such timelines may be extended if the Loan Obligations are not released and the Union Bank Documents recorded before Closing.
d. Real Estate Reporting Person. Escrow Agent is hereby instructed to comply with all applicable Federal, state and local reporting and withholding requirements relating to the close of this transaction. Escrow Holder is hereby designated the “real estate reporting person” for purposes of Section 6045 of Title 26 of the United States Code and Treasury Regulation 1.60454 and any instructions or settlement statement prepared by Escrow Holder shall so provide. Upon the consummation of the transaction contemplated by this Agreement, Escrow Agent shall, in addition to complying with any applicable state and local requirements, file Form 1099 information return and send the statement to City as required under the aforementioned statute and regulation.
12. Closing Cost Allocation.
a. BRS shall pay (i) Escrow Agent’s escrow fee; (ii) Title Company’s charges for the Owner’s Title Policy, including any charges for extended title coverage and any additional title endorsements requested by BRS; and (iii) recording fees associated with recording the Grant Deed and Collaborative Use Easement in the Official Records.
b. City shall pay (i) any City, County and/or other documentary transfer stamps, if any; and (ii) all fees and costs (including without limitation Escrow Agent’s fee, recording fees, and Title Company charges) associated with the release of the Loan Obligations and/or the recording of the Union Bank Documents in the Official Records. City’s obligations to pay such costs concerning the Loan Obligations and/or the Union Bank Documents shall survive the Close of Escrow.
c. All other closing costs and charges attributable to BRS’ acquisition of the Subject Property shall be paid by the Parties in accordance with the customary practice in the County
where the property is located. All other closing costs and changes attributable to the release of the Loan Obligations and/or the Union Bank Documents shall be borne by City, which obligation shall survive the Close of Escrow.
d. The foregoing provisions of this Section 12 notwithstanding, should the obligations of BRS to purchase, and City to sell, the Subject Property be terminated in accordance with this Agreement, BRS and City shall each pay one-half (½ ) of the cost of the escrow cancellation fees and other amounts due Escrow Agent and the Title Company; provided, however, that should this Escrow be terminated as a result of the default by one of the Parties hereto, the defaulting Party shall pay the entire amount of the cancellation fees and other amounts due Escrow Agent and the Title Company, and the non-defaulting Party shall have no liability therefor.
e. BRS shall pay its own attorneys’ fees in connection with the preparation and negotiation of this Agreement and in connection with the consummation of the transactions contemplated hereby. All fees of the City shall remain subject to the Reimbursement Agreement.
13. Prorations. All non -delinquent taxes and assessments applicable to the Subject Property, including, without limitation, all property taxes and assessments shall be prorated as of the Close of Escrow on the basis of the actual number of days of t he month that have elapsed as of the Close of Escrow and based upon a three-hundred-sixty-five (365) day year. With respect to prorations related to real property taxes and assessments, the basis for said proration shall be the amount shown for real property taxes and assessments in the most recent installment for the fiscal year in which the Close of Escrow occurs. If no installment for the fiscal year in which Close of Escrow occurs is available, BRS and City shall reasonably estimate such installment which shall be used to prorate taxes and assessments. No adjustment shall be made for any change in the real property taxes and assessments occurring by virtue of the sale of the Subject Property to BRS. The amount of such prorations shall be subject to adjustment in cash after the Close of Escrow outside of Escrow as and when complete and accurate information becomes available, if such information is not available on the Closing Date. City and BRS agree to cooperate and use their good faith efforts to ma ke such adjustments prior to ninety (90) days after the Close of Escrow, if updated tax bills are available. This Section 13 shall survive the Closing for two (2) years.
14. Representations and Warranties.
a. Representations and Warranties of City . City hereby makes the following representations to BRS, which representations are true in all respects as of the date hereof and as of the Closing.
i. Due Authorization.
A. The execution, delivery and performance of this Agreement by City have been duly authorized by the requisite action on the part of City, and no other authorization or consent is required therefor. No approvals, authorizations or consents of any public body or any other person or entity (except for those already obtained) are necessary in conne ction with this Agreement or the transactions contemplated hereby. This Agreement constitutes the legal, valid and binding obligation of City, and is enforceable in accordance with its terms against City, subject only
to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles affecting or limiting the rights of contracting parties generally.
B. BRS also acknowledges that City requires authorization from Union Bank to release the Subject Property from the Loan Obligations. Union Bank’s failure to provide such authorization prior to the Closing , as provided by Section 6( a) shall not be deemed a breach of this representation or a pre -closing breach of this Agreement within the meaning of Section 16.
ii. No Options. City has not granted any option or right of first refusal or first opportunity to any party to acquire any interest in the Subject Property.
iii. Due Diligence Materials . To City’s knowledge, the Due Diligence Materials are complete, include the various items identified on Exhibit D, and will include all contracts and agreements that concern the Subject Property, including all contracts related to the rights of third parties to use, possess, occupy, improve, or maintain the Subject Property (which representation shall survive the closing).
iv. Eminent Domain. To City’s knowledge, there are no existing, proposed, threatened or contemplated eminent domain proceedings that would affect the Subject Property in any way whatsoever.
v. Litigation. To City’s knowledge, there is no adverse claim (including mechanic’s liens), litigation or administrative proceeding or governmental investigation pending or threatened in writing, that does or will have a material, adverse effect on City or the Subject Property.
vi. Violations of Law . To City’s knowledge, no notices of any material violation of governmental regulations, ordinances or laws relating to the Subject Property have been received by City or, to City’s knowledge, entered against City written the twelve (12) months prior to the Effective Date.
vii. Violation of Agreements . To City’s knowledge, neither this Agreement nor anything provided to be done hereunder, including but not limited to, the transfer, assignment and sale of the Subject Property, viol ates or shall violate any contract, agreement or instrument to which City is a party or that affects the Subject Property or any part thereof.
viii. Hazardous Materials . City has not received from or given to any governmental authority or other party any notic e or other communication or agreement relating in any way to the presence, placement, generation, transportation, storage, release, treatment or disposal of any Hazardous Materials or other environmental conditions on, at, under or about the Subject Property. As used herein, “ Hazardous Materials ” shall mean any “Hazardous Material,” “Hazardous Substance,” “Pollutant” or “Contaminant,” “Petroleum” and “Natural Gas Liquids” as those terms are defined or used in Section 101 of CERCLA or any substance which is defined as a hazardous material, hazardous waste, or hazardous substance in any federal, state or local law, rule or regulation, and any other substance regulated because of its affect or potential effect on public health or the environment, including, but not limited to, any radioactive substance, hydrocarbons, industrial solvents, metals, flammable materials, explosives or other hazardous substance or toxic material.
ix. Bankruptcy. No attachments or execution proceedings and no assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings are pending or threatened against City or concerning all or part of the Subject Property, nor are any such proceedings contemplated by City. City has not been insolvent for the las t one -hundred- twenty (120) days preceding the Effective Date.
x. No Bonds. City has not posted any bonds or other collateral with any governmental authorities to secure performance of any obligations with respect to the development of the Subject Property.
xi. Anti-Money Laundering. City is in compliance with the requirements of Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 23, 2001) (the “ Order”) and other similar requirements contained in the rules and regulations of the Office of Foreign Assets Control, Department of the Treasury (“OFAC”) and in any enabling legislation or other Executive Orders or regulations in respect thereof (the Order and such other rules, regulations, legislation, or orders are collectively called the “Orders”).
xii. Prohibited Transactions. City (A) is not listed on the “Specially Designated Nationals and Blocked Persons List” maintained by OFAC pursuant to the Order and/or on any other list of terrorists or terrorist organizations maintained pursuant to any of the rules and regulations of OFAC or pursuant to any other applicable Orders (such lists are collectively referred to as the “Lists”); (B) is not a person who has been determined by competent authority to be subject to the prohibitions contained in the Orders; or (C) is not or has not engaged in any dealings or transactions with any Forbidden Entity. A “Forbidden Entity” is defined as (Y) the governments of Cuba, Iran, North Korea, Myanmar, Syria and Sudan (each, a “Prohibited Country”) and any of their agencies, includi ng, but not limited to political units and subdivisions (each, a “ Prohibited Government”); and (Z) any company that (1) is wholly or partially managed or controlled by a Prohibited Government, (2) is established, organized under, or whose principal place of business is in any Prohibited Country, or (3) has failed to submit an affidavit following request therefore averring that it does not own or control any property or asset in and has not and does not transact business with any Prohibited Country. For purposes of this Section, a “company” is any entity whether publicly traded or privately owned capable of affecting commerce, including, but not limited to, a government, government agency, natural person, legal person, sole proprietorship, partnership, firm, corporation, subsidiary, affiliate, franchisor, franchisee, joint venture, trade association, financial institution, utility, public franchise, provider of financial services, trust, or enterprise and any association thereof.
b. Representations and Warranti es of BRS . BRS hereby makes the representations and warranties set forth in this section for the benefit of City and its successors and assigns. BRS shall notify City in writing immediately if BRS becomes aware that any representation or warranty has bec ome untrue or misleading in light of information obtained by BRS after the Effective Date.
i. Authority. BRS is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware and has been qualified to do business in the State of California, or shall be so qualified on or before the Effective Date. The execution, delivery and performance of this Agreement by BRS have been duly authorized by the requisite action on the part of BRS, and no other author ization or consent is required therefor. No
approvals, authorizations or consents of any public body or any other person or entity (except for those already obtained) are necessary in connection with this Agreement or the transactions contemplated hereby. This Agreement constitutes the legal, valid and binding obligation of BRS, and is enforceable in accordance with its terms against BRS, subject only to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles affecting or limiting the rights of contracting parties generally.
ii. No Conflict . The execution and delivery of this Agreement and the consummation of the transactions contemplated hereunder on the part of BRS do not and will not violate any applicable law, ordinance, statute, rule, regulation, order, decree or judgment, conflict with or result in the breach of any terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge, or encumbrance upon any of the property or assets of BRS by reason of the terms of any contract, mortgage, lien, lease, agreement, indenture, instrument or judgment to which BRS is a part or which is or purports to be binding upon BRS or which otherwise affects BRS, which will not be discharged, assumed or released at the Close of Escrow.
iii. Litigation. There are no claims, actions, suits or proceeding continuing, pending or to BRS’ actual knowledge, threatened, which would materially adversely affect BRS’ ability to perform the transaction contemplated by this Agreement.
iv. Bankruptcy. No attachments or execution proceedings and no assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings are pending or threatened against BRS or concerning any of BRS’ assets, nor are any of such proceedings contemplated by BRS, nor has BRS ever been a debtor under any case commenced under the United States Bankruptcy Code. BRS has not been insolvent for the last one -hundred- twenty (120) days preceding the Effective Date.
v. Financial Capability. BRS is financially able to fully perform hereunder.
vi. Anti-Money Laundering. BRS is in compliance with the requirements of the Order, and other similar requirements contained in the rules and regulations of OFAC, and in any enabling legislation.
vii. Prohibited Transactions. BRS (A) is not listed on the Lists; (B) is not a person who has been determined by competent authority to be subject to the prohibitions contained in the Orders; or ( C) is not or has not engaged in any dealings or transactions with any Forbidden Entity; and ( D) any company that (1) is wholly or partially managed or controlled by a Prohibited Government, (2) is established, organized under, or whose principal place of business is in any Prohibited Country, or (3) has failed to submit an affidavit following request therefore averring that it does not own or control any property or asset in and has not and does not transact business with any Prohibited Country. For purposes of this Section, a “company” is any entity whether publicly traded or privately owned capable of affecting commerce, including, but not limited to, a government, government agency, natural person, legal person, sole proprietorship, partnership, firm, corporation, subsidiary, affiliate, franchisor, franchisee, joint venture, trade association, financial institution, utility, public franchise, provider of financial services, trust, or enterprise and any association thereof.
c. Survival of Representations. The express representations and warranties made in this Agreement shall survive the Close of Escrow for a period of six (6) months and shall not merge into any instrument or conveyance delivered at the Close of Escrow.
15. Condemnation & Casualty.
a. Condemnation. If before the Close of Escrow, all or any portion of the Subject Property is subject to an actual or threatened taking by a governmental or quasi-governmental entity or public authority, by the power of eminent domain or otherwise, BRS shall have the right, exercisable by giving written notice to City within fifteen (15) days after BRS’ receipt of written notice from City of such taking to either (i) to terminate its obligation to purchase the Subject Property, in which case the Purchase Deposit (less the Nonrefundable. Consideration Payment and Appraisal Fees) shall be immediately refunded to BRS, less any amounts due to Escrow Holder from BRS pursuant to this Agreement, BRS’ obligation to purchase, and City’s obligation to sell, the Subject Property shall terminate (with any unexpended amounts pursuant to the Negotiation Fee or City Cost Security Deposit shall be returned to BRS by City outside of Escrow), and neither Party shall have any further obligation to the other except as otherwise provided in this Agreement, or (ii) to accept the applicable portion of the Subject Property in its then existing condition, in which case, all condemnation awards shall be paid or assigned to BRS. If BRS elects to proceed under clause (ii) above, City shall not compromise, settle or adjust any claims to such condemnation award without BRS’ prior written consent. BRS’ failure to deliver such notice within the time period specified shall be deemed to constitute BRS’ election to terminate its obligation to purchase the Subject Property. In the event that condemnation awards are tendered to BRS under this Section 15(a) and Rescission later occurs or the City exercises a Power of Termination, the proceeds of any condemnation awards shall be returned to City.
b. Casualty. BRS shall have no right to terminate this Agreement in the event of any casualty to the Subject Property or any improvements that may be located on the Subject Property, as BRS is acquiring the Subject Property for development purposes.
16. Default and Remedies.
a. Notice of Default; Opportunity to Cure. Any failure by Party to perform any obligation established by this Agreement (i.e., a pre- or post-closing obligation) or its failure to observe or perform any other provision, covenant or condition of this Agreement shall be a breach of this Agreement, provided that such failure continues for five (5) business days after written notice thereof; provided that if the nature of such breach is such that the same cannot reasonably be cured within a five (5) business day period, the Party alleged to be in breach shall not be deemed to be in default if it diligently commences such cure within such period and thereafter diligently proceeds to rectify and cure such default, but in no event exceeding a period of time in excess of ten (10) calendar days after written notice thereof. In no event shall either Party have the right to cure a pre-Closing default after the Outside Closing Date.
b. Remedies for Defaults.
i. City Pre-Closing Default. In the event of a material pre -closing default by City under this Agreement, BRS shall have either (A) the right to pursue specific performance of
this Agreement, provided that an action for specific performance is filed with the Superior Court for the County where the Subject Property is located within sixty (60) days after City’s alleged default, or (B) the right to terminate this Agreement and recover the Purchase Deposit , less the Nonrefundable Consideration Payment and Appraisal Fees . Any unexpende d amounts pursuant to the Reimbursement Agreement shall be returned to BRS by City outside of Escrow.
ii. BRS Pre-Closing Default. In the event of a material pre -closing default by BRS under this Agreement, City shall have the right to terminate this Agreement, in which case the Purchase Deposit shall be retained by City.
In the event of a post-closing default by City or BRS under any of the agreement(s) outlined in Section 6 of this Agreement, the remedies provided in such agreement(s) shall apply, rather than this Section 16.
17. No Waiver. The waiver by one Party of the performance of any covenant, condition or promise shall not invalidate this Agreement nor shall it be considered a waiver by such Party of any other covenant, condition or promise hereunder. The waiver by either or both Parties of the time for performing any act shall not constitute a waiver of the time for performing any other act or identical act required to be performed at a later time. The exercise of any remedy provided by law and th e provisions of this Agreement for any remedy shall not exclude other consistent remedies unless they are expressly excluded.
18. Construction. As used in this Agreement, the masculine, feminine or neuter gender and the singular or plural numbers shall each be deemed to include the other whenever the context indicates. This Agreement shall be construed as a whole and in accordance with its fair meaning, the captions being for convenience only and not intended to fully describe or define the provisions in the portions of the Agreement to which they pertain. Each Party hereto, and counsel for each Party hereto, has reviewed and revised this Agreement, and the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation or construction of this Agreement. This document shall, in all respects, be governed by the laws of the State of California applicable to agreements executed and to be wholly performed within the State of California. Nothing contained herein shall be construed so as to require the commission of any act contrary to law, and wherever there is any conflict between any provision contained herein and any present or future statute, law, ordinance or regulation contrary to which the Parties have no legal right to contract, the latter shall prevail but the provision of this document that is affected shall be curtailed and limited only to the extent necessary to bring it within the requirements of the law.
19. No Personal Liability.
a. Without affecting the obligations or liabilities of the entities comprising BRS, no shareholder of BRS or any shareholder, member or equity holder or affiliate of BRS or any of their respective directors, officers, agents, consultants or employees will be personally liable to City for any claim, loss, expense or liability arising from or in connection with this Agreement, and City hereby waives any such liability. This Section 19(a) shall not impact City’s ability to exercise the remedies provided in Section 16(b)(ii) in the event of a breach of this Agreement by BRS prior to the Close of Escrow.
b. No elected official, officer, agent, consultant or employee of City will be personally liable to BRS for any claim, loss, expense or liability arising from or in connection with this Agreement, and BRS hereby waives any such liability.
20. Merger/Integration. The Parties intend this paragraph to be a conclusive recital of fact pursuant to Section 622 of the California Evidence Code. This Agreement and the exhibits attached hereto supersede any prior agreement, oral or written, including without limitation the ERN, as amended, and contain the entire agreement between the Parties on the subject matter hereof. This Agreement (including the exhibits attached hereto) is intended to be a final expression of the agreement of the Parties and is an integrated agreement within the meaning of Section 1856 of the California Code of Civil Procedure. No subsequent agreement, representation or promise made by either Party hereto, or by or to any employee, officer, agent or representative of either Party shall be of any effect unless it is in writing and executed by the Party to be bound thereby. There are no contemporaneous separate written or oral agreements between the Parties in any way related to the subject matter of this Agreement, with the exception those documents specifically identified herein.
21. Amendments. This Agreement and any modifications, amendments or supplements thereto may be executed in seve ral counterparts, and all so executed shall constitute one agreement binding on all parties hereto, notwithstanding that all parties are not signatories to the original or the same counterpart. The parties may also deliver executed copies of this Agreemen t to each other by facsimile or electronic mail, which facsimile or electronic mail signatures shall be binding. Any facsimile or electronic mail delivery of signatures shall be followed by the delivery of executed originals.
22. Counterparts. This Agreement may be executed in any number of counterparts and by facsimile. Each such counterpart hereof shall be deemed to be an original instrument but all such counterparts together shall constitute but one agreement.
23. Survival. Subject to any specific limitati ons described in this Agreement, All covenants, agreements, representations and warranties made herein shall survive the execution and delivery of this Agreement, the Close of Escrow, the recording of the Grant Deed conveying the Subject Property to BRS and all deliveries contemplated herein.
24. Computation of Periods . All periods of time referred to in this Agreement shall include all Saturdays, Sundays and State or National holidays, unless the period of time specifies “business days”, in which case such p eriod of time shall exclude Saturdays, Sundays and State and National holidays; provided that if the date or last date to perform any act or give any notice with respect to this Agreement shall fall on a Saturday, Sunday or State or National holiday, such act or notice may be timely performed or given on the next succeeding day that is not a Saturday, Sunday or State or National holiday. For purposes of this Agreement, the phrase “State and National holiday” shall refer to any day in which the Escrow Agent , Title Company and/or the Office of the County Recorder for the County of Solano is/are closed for business.
25. Independent Counsel . EACH PARTY TO THIS AGREEMENT ADMITS,
ACKNOWLEDGES AND REPRESENTS THAT IT HAS HAD THE OPPORTUNITY TO
CONSULT WITH AND BE REP RESENTED BY INDEPENDENT COUNSEL OF SUCH
PARTY’S CHOICE IN CONNECTION WITH THE NEGOTIATION, EXECUTION AND AMENDMENT OF THIS AGREEMENT. EACH PARTY FURTHER ADMITS,
ACKNOWLEDGES AND REPRESENTS THAT IT HAS NOT RELIED ON ANY
REPRESENTATION OR STATEMENT MADE BY ANY OF THE ATTORNEYS AND
REPRESENTATIVES OF THE OTHER PARTY WITH REGARD TO THE SUBJECT MATTER, BASIS, OR EFFECT OF THIS AGREEMENT.
26. Assignment. This Agreement shall not be assignable by BRS without City’s prior written consent, which consent may be grante d or withheld in City’s sole discretion, which may be withheld for any reason or no reason whatsoever. Notwithstanding the above, BRS shall be permitted to assign this Agreement to a member of BRS, an affiliate of BRS, or to a legal entity under common control with BRS (“ Permitted Assignee ”), and need only provide City with notice of such assignment, provided that the Permitted Assignee shall assume BRS’ obligations under this Agreement. Subject to the foregoing, this Agreement shall inure to the benefit of and be binding upon the heirs, personal representatives, successors, and permitted assigns of the Parties, and each of them.
27. No Obligation to Third Parties . Except as expressly set forth in this Agreement, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, nor obligate either of the Parties hereto, to any person or entity other than each other.
28. Legal Fees. If either BRS or City brings any action, arbitration or suit against the other for any matter relating to or arising out of this Agreement, then the prevailing party in such action or dispute, whether by final judgment or settlement and including any appeals, shall be entitled to recover from the other party all costs and expenses of suit, including reasonable attorneys’ fees and expert witness fees. Any judgment or order entered in any final judgment shall contain a specific provision providing for the recovery of all costs and expenses of suit, including reasonable attorneys’ fees incurred in enforcing, perfecting and executing such judgment.
29. Tax Deferred Exchange. The Parties agree to cooperate with each other in effecting a tax-deferred exchange or exchanges under Internal Revenue Code Section 1031; provided, however, that (a) consummation of this Agreem ent is not predicated or conditioned on an exchange, (b) the Close of Escrow shall not be delayed due to any exchange, (c) any rights of the non-exchanging Party pursuant to this Agreement shall not be impaired due to any exchange requested by the other Pa rty, (d) the non-exchanging Party shall incur no additional costs, expenses or liabilities as a result of or in connection with any exchange requested by the other Party except those incurred in connection with the non-exchanging Party’s review of customary exchange documentation, and (e) the non-exchanging Party shall not be required to take title to any other property in connection with any exchange requested by the other Party. Subject to the foregoing, the Parties agree to execute customary escrow instructions, documents, agreements, or instruments to effect an exchange. Each Party agrees to indemnify, defend and hold the other Party free and harmless from and against any liability, loss, damage, cost or expense (including, without limitation, reasonable attorneys’ fees, costs and expenses) that may arise from the indemnifying Party’s exchange.
30. Broker. BRS and City each represent and warrant that no broker, salesman or finder has been engaged by it in connection with any of the transactions contemplated by this Agreement or, to its knowledge, is in any way connected with any of such transactions. In t he event of any other claim for broker’s, consultant’s or finder’s fees or commissions in connection with the negotiation,
execution or consummation of this Agreement, then BRS shall indemnify, save harmless and defend City from and against such claim if it shall be based upon any statement, representation or agreement made by BRS; and City shall indemnify, save harmless and defend BRS from and against such claim if it shall be based upon any statement, representation or agreement made by City.
31. Confidentiality.
a. Any information provided by BRS to City, including pro formas and other financial projections (whether in written, graphic, electronic or any other form), that is clearly marked as “CONFIDENTIAL PROPRIETARY INFORMATION” (“Confidential Information”) shall be subject to the provisions of this Section 31. Subject to the terms of this Section, City shall use good faith diligent efforts to prevent disclosure of the Confidential Information to any third parties, except as may be required by the California Public Records Act (Government Code Section 6253 et seq.) or other applicable local, state or federal law (collectively, “Public Disclosure Laws”). Notwithstanding the preceding sentence, City may disclose Confidential Information to its officials, employees, agents, attorneys and advisors, but only to the extent necessary to carry out the purpose for which the Confidential Information was disclosed. BRS acknowledges that City has not made any representations or warranties that any Confidential Information received from BRS will be exempt from disclosure under any Public Disclosure Laws. In the event of a request to City for disclosure of any Confidential Information, City shall immediately advise BRS of such request in order to give BRS the opportunity to object to the disclosure of such Confidential Information. To the extent City’s legal counsel, after consultation with BRS, determines· that the release of the Confidential Information is required by Public Disclosure Laws, or order of a court o f competent jurisdiction, City shall notify BRS of City’s intention to release the Confidential Information. If the City Attorney, in his or her discretion after consultation with BRS, determines that only a portion of the requested Confidential Information is exempt from disclosure under the Public Disclosure Laws, City may redact, delete or otherwise segregate the Confidential Information that will not be released from the non -exempt portion to be released.
b. BRS acknowledges that in connection with City Council’s consideration of this Agreement, City will need to present a summary of anticipated project revenues, and returns on cost and investment. City and BRS shall cooperate in the preparation of any such summary.
c. If any litigation is filed seeking to m ake public any Confidential Information, City and BRS shall cooperate in defending the litigation, and BRS shall pay City’s reasonable out -of- pocket costs of defending such litigation and shall indemnify City against all costs and attorneys’ fees awarded to the plaintiff in any such litigation as well as City staff or City Attorneys’ office costs. City shall use good faith diligent efforts to prevent disclosure of the Confidential Information to any third parties, subject to Public Disclosure Laws. Alternatively, BRS and the City may jointly elect to disclose the Confidential Information rather than defend the litigation. The Parties’ obligations under this Section 31 shall survive the expiration or termination of this Agreement.
d. The restrictions set forth herein shall not apply to Confidential Information to the extent such Confidential Information: (i) is now, or hereafter becomes, through no act or failure to act on the part of City or its representatives, generally known or ava ilable; (ii) is known by City at the time of receiving such information as evidenced by City’s public records; (iii) is hereafter furnished to City by a third party, as a matter of right and without restriction on disclosure; (iv) is independently
developed by City without any breach of this Agreement and without any use of or access to BRS’ Confidential Information as evidenced by City’s records; (v) is not clearly marked “CONFIDENTIAL/PROPRIETARY INFORMATION” as provided above (except where BRS notifies City in writing, prior to any disclosure of the Confidential Information, that omission of the “CONFIDENTIAL/PROPRIETARY INFORMATION” mark was inadvertent), or (vi) is the subject of a written permission to disclose provided by BRS to City.
The obligations established by this Section 31 shall survive the Close of Escrow.
32. Notices. Any notice, request, demand, or other communication given with reference to this Agreement shall be in writing, shall reference this “ Purchase and Sale Agreement and Joint Escrow Instructions” and shall be delivered personally, by overnight courier or by First Class mail, correctly addressed as follows, or to such other address(es) of which a Party may from time to time provide notice, in accordance with this paragraph:
TO CITY:
City of Vallejo
Attn: City Manager
555 Santa Clara Street
Vallejo, CA 94590
City of Vallejo
Attn: Economic Development Manager
555 Santa Clara Street
Vallejo, CA 94590
TO BRS:
Blue Rock Springs, LLC
c/o Lewis Management Corp.
1156 North Mountain Avenue
P.O. Box 670
Upland, CA 91786
Blue Rock Springs, LLC
c/o Lewis Management Corp.
9216 Kiefer Blvd.
Sacramento, CA 95826
COPY TO:
City of Vallejo
Attn: City Attorney
555 Santa Clara Street
Vallejo, CA 94590
COPY TO:
Corie A. Edwards
Reuben, Junius & Rose, LLP
One Bush Street, Suite 600
San Francisco, CA 94104
A copy of any Notice given by BRS or City to the other prior to the Close of Escrow shall also be given to Escrow Holder as above provided. Notices so submitted shall be deemed to have been given (a) on the date personally served, if by personal service, (b) on the date of confirmed dispatch, if by electronic communication or facsimile, or (c) upon the business day that delivery is confirmed by certified U.S. mail or overnight courier service. The addresses and addressees, for the purpose of this Section, may be changed by giving written notice of such change in the manner herein provided for giving notice. Unless and until such written Notice of change is received, the last address and addressee stated by written Notice, or provided herein if no such written Notice of change has been received, shall be deemed to continue in effect for all purposes hereunder. BRS and City hereby agree that notices may be given hereunder by the parties’ respective counsel and that, if any communication is to be given hereunder by BRS’ or City’s counsel, such counsel may communicate directly with all principals as required to comply with the provisions of this Section.
The following are the Exhibits to this Agreement:
Exhibit Title
A Legal Description – City Property
B Syar Agreement
C-1 through C-3 Legal Descriptions – Subject Property
D Due Diligence Materials
E Form of Grant Deed
F Form of General Assignment
[SIGNATURES FOLLOW]
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date and year first above written.
THE CITY OF VALLEJO
a municipal corporation
_____________________________________
By: Michael Malone
Its: City Manager
BLUE ROCK SPRINGS, LLC
a Delaware limited liability company
By: LEWIS MANAGEMENT CORP.,
a Delaware corporation
Its: Manager
_______________________________
By: John Goodman
Its: Chief Executive Officer and
Executive Vice President
ATTEST:
_____________________________________
By: Dawn Abrahamson
Its: City Clerk
APPROVED AS TO CONTENT:
_____________________________________
By: Gillian Hayes
Its: Assistant City Manager
APPROVED AS TO FORM:
_____________________________________
By: Veronica A. F. Nebb
Its: City Attorney
APPROVED AS TO INSURANCE:
_____________________________________
By: Armond Sarkis
Its: Risk Manager
[EXHIBITS TO BE ATTACHED]
Exhibit A Legal Description – City Property
Exhibit B Purchase and Sale Agreement and Joint Escrow Instructions Exhibit B Syar Agreement
1 SETTLEMENT AND RELEASE AGREEMENT
Thi
s Settlement and Release Agreement ("Agreement") is entered into effective August 1, 2022 (“Effective Date”), by and among SYAR INDUSTRIES, INC. ("Syar"), the CITY OF VALLEJO ("City"), and BLUE ROCK SPRINGS, LLC (“Developer”). Syar, the City, and Developer are each individually referred to as "Party" and collectively referred to as "Parties." RECI
TALS
WHE
REAS, Syar is the record owner of that certain real property located immediately east of the City, in the unincorporated area of Solano County which property consists of APN 0181-190-060 and portions of 181-210-030 and 181-220-040 (“Syar Property”). Syar owns and operates the Lake Herman Quarry (hereafter the “Quarry”), which includes an active quarry pit, an asphalt plant, a rock processing plant, a concrete batch plant, and other related operations authorized under a Land Use Permit from the County of Solano and located on the Syar Property (collectively the “Quarry Operations”); and
WH
EREAS, City is the record owner of that certain real property consisting of approximately 225 acres of land located adjacent to the Syar Property consisting of APNs 0081-040-100; and 0081-040-110; and 0081-040-880; and 0081-191-010; and 0181-190-010; and 0181-190-070; and 0182-040-080,
which is more particularly described in Exhibit A, attached hereto and incorporated herein by reference (the “City Property”); and WHE
REAS, City owns and operates on the City Property the Blue Rock Springs Golf Course, which consists of two 18-hole courses, and associated structures (“Blue Rock GC”); and WHE
REAS, a portion of Blue Rock GC is located upon land that was the donated to the City by Syar pursuant to a Donation Agreement as referenced below; and WHE
REAS, a portion of Columbus Parkway and a portion of Lake Herman Road, within the City limits of the City of Vallejo, are designated as truck routes pursuant to City Resolution No. 10-294 N.C.; and
WHE
REAS, on November 6, 1990, City and Syar entered into that certain Agreement Pertaining to Site Preparation for Expansion of the Blue Rock Springs Golf Course and Improvements to Columbus Parkway and Lake Herman Road, which was amended on May 20, 1991 (“Site Preparation Agreement”); and
WH
EREAS, on November 6, 1990, City and Syar entered into that certain Agreement Pertaining to the Donation of Land for the Expansion of the Blue Rock Springs Golf Course (“Donation Agreement”); and
WHE
REAS, on December 4, 2014, the County of Solano (“County”) granted to Syar Land Use Permit No. U-08-09 and Reclamation Plan No. RP-08-01 (“Quarry Permit”). Said Quarry Permit was subject to a Mitigation Monitoring Plan and conditions of approval (“Conditions”) outlined in the Quarry Permit. The Quarry Permit is valid until December 4, DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 2 2049, and Syar is permitted to apply to the County for an extension of the term of the Quarry Permit at least 6 months prior to its expiration. Syar is required to submit compliance reporting information to the County by October 1 of each year; and WHEREAS, on August 8, 2017, City issued a Request for Qualifications (“RFQ”) for the “Revitalization of Two 18-Hole Golf Courses and 225 Acres at Blue Rock Springs Municipal Golf Course through a Public-Private Partnership, Management, Lease or Other Agreement.” The RFQ identified three goals for any revitalization project: (1) fund the design, renovation, and restoration of Blue Rock in a manner that allows for it to operate as an affordable public course but independent of subsidies from City; (2) fund the development of a new or renovated multi- use clubhouse and associated facilities ser ving both the golf course and the local community; and (3) preserve or improve the existing aesthetics, quality, property values, environment and views of the surrounding neighborhoods; and
WHERE
AS, on November 18, 2018, Developer’s predecessor-in-interest, the Greg Norman Golf Course Design Company, LLC, submitted a proposal in response to the RFQ, to City to develop on the City Property one 8-hole Greg Norman Signature golf course and associated improvements and a new subdivision consisting of 615 residential units ("Project"); and
WHERE
AS, Syar contends that the Project has substantial potential to create significant environmental impacts, including land use compatibility problems because the Project proposes placing residential housing within one half mile of the Quarry and the activities permitted by the Quarry Permit; and
WHEREAS, on February 19, 2020, Syar submitted to the City the “City of Vallejo Parks, Recreation, and Open Space Protection Initiative”. Presently, such initiative is scheduled to be considered by the voters on the November 3, 2022 ballot (“Initiative”); and WHERE
AS, on June 2, 2020, Syar sent a letter to the City (pursuant to Gov. Code, §§ 910, 910.2 & 910.4) alleging that by “carrying out this Project in its current form, the City will violate the terms of the Site Preparation and Donation Agreements” (“Claim”); and WHERE
AS, City disputes both the legality/validity of the Initiative and the allegations of the Claim; and
WHERE
AS, On December 23, 2020, Syar and City entered into a Tolling Agreement to toll any applicable statute of limitations arising out of the Site Preparation Agreement or the Donation Agreement, which will expire at 11:59 p.m. on May 31, 2022; and WHEREAS, Developer has prepared a revised proposal to relocate the residential subdivision component of the Project to the west side of Columbus Parkway and to designate an area of the Project Site between the Quarry and the subdivision to serve as a buffer, provided Syar withdraws its opposition to the Project and withdraws the Initiative; and DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 3 WHEREAS, neither the City nor the Developer has submitted any application for any project related to the Golf Course for approval or consideration by the City, and City has not commenced environmental review for any proposal to redevelop the City Property; and WH
EREAS, City is willing to enter into an agreement confirming that the Site Preparation Agreement and Donation Agreements remain in effect. City is further willing to: (1) permit the submission of an application by Developer which includes a designation of an area of the City Property between the Quarry and Columbus Parkway as a buffer zone between new development, and the Quarry; and (2) agree to the recordation of a Collaborative Use Easement providing notice of the Quarry and its operations to all land uses within the easement area provided that Syar withdraws the Initiative and releases the Claim and all other legal claims against the City and provided that the Project, as revised, is ultimately approved.
NOW,
THEREFORE, in consideration of, and in return for, the promises and covenants undertaken in this Agreement by the Parties, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Parties hereby agree as follows:
TERM
S
1. Al
l of the foregoing recitals are hereby incorporated by this reference.
2. Th
e City acknowledges the existence of the Site Preparation and Donation Agreements and that such agreements remain in full force and effect as of the Effective Date of this Agreement.
3. De
veloper agrees that Developer will submit development applications (“Development Applications”) for a revised project (“Revised Project”). The Revised Project shall comply with and be supported by a land plan which shall illustrate the placement, location, and design of structures and associated outdoor facilities for which the Developer will submit applications for development proposed to be constructed upon the City Property. Such applications of Developer shall be in substantial conformance with the Land Plan and the Buffer Zone attached hereto as Exhibits B (“Land Plan”), Exhibit C (“Buffer Zone”), and Exhibit D (Buffer Zone Legal Description) incorporated herein by reference. The terms of this Agreement that apply to or contemplate the aforesaid Development Applications shall also apply to and contemplate any applications submitted by Developer subsequent to any approval of the Revised Project seeking, for instance, a modification of the Revised Project.
3.1. T
he Parties understand and agree that City retains both its authority as the owner of the City Property and its land use authority as a municipality and charter city and may approve or deny a Purchase and Sale/ Disposition Agreement relating to any portion of the City Property and may likewise, approve, approve with conditions, or deny the Revised Project.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 4 3.2. If the Revised Project is approved, and the City Property or a portion thereof is transferred to the Developer, all development on the City Property constructed by the Developer, or any successor thereto, shall be consistent with the Land Plan & Buffer Zone, both of which shall apply to the City Property for the term of the Quarry Permit and any extension to the Quarry Permit as may be approved by Solano County in the future, unless earlier terminated by the Parties, in writing.
3.3. I
n the event that the Developer abandons the Revised Project before it is built, withdraws its Development Applications, or otherwise abandons the Revised Project before the City has decided whether to approve or deny the Revised Project, or in the event that the City approves the Revised Project but does not transfer the City Property to the Developer, the Buffer Zone shall apply to any future development of that portion of the City Property depicted in Exhibit C and described in Exhibit D, attached hereto and incorporated herein by reference (“Buffer Zone”) for the term of the Quarry Permit and any extension to the Quarry Permit as may be approved by Solano County in the future.
3.4. I
n the event that the Developer abandons the Revised Project before construction thereof, but after approval of the Revised Project, and before transfer of the City Property to the Developer, or in the event that the City approves the Revised Project but does not transfer the City Property to the Developer, the Land Plan shall apply to any future development of the City Property either (1) for a term of 10 years from date of such abandonment, withdrawal, or any City decision not to transfer the City Property to the Developer; (2) for the term of the Quarry Permit and any extension to the Quarry Permit as may be approved by Solano County in the future; or (3) until cessation of use of the Quarry Property pursuant to the approved Quarry Permit (or any extension thereof) for a period of 365 Days, whichever is less. Said 10-year period may be extended upon the mutual written agreement of City and Syar. Notwithstanding the forgoing terms applicable to the Land Plan in Exhibit B, the Buffer Zone provisions referenced in Section
3.3, described in Section 3.5 and depicted in Exhibit C and Exhibit D shall apply continuously for the term of the Quarry Permit and any extension thereto.
3.5. T
he Buffer Zone as depicted in Exhibit C and described in Exhibit D affects future residential and commercial development within one-half mile of the Quarry Area throughout the term of the Quarry Permit and any extension to the Quarry Permit as may be approved by Solano County in the future. Specifically, (a) the maximum development footprint for residential uses within the one-half mile radius of the Quarry Area is depicted as the orange area shown on the Buffer Zone map (Exhibit C). (b) the maximum development footprint for commercial uses within the one-half mile radius of the Quarry Area is depicted as the red area shown on the Buffer Zone map (Exhibit C); (c) No residential uses shall be allowed east of Columbus Parkway but are not excluded from the orange area west of Columbus Parkway; and (d) Any future clubhouse east of Columbus Parkway shall be within 300 feet of the Parkway and no further north DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 5 than the existing clubhouse. The Buffer Zone shall not in any way preclude outdoor golf uses.
4. Sy
ar, City and Developer shall negotiate and enter into a collaborative use easement, which shall, conditioned upon and concurrent with the transfer of any portion of the City Property to Developer or any other party, be recorded in the Official Records for Solano County, and which shall be appurtenant to the Syar Property and encumber the portion of the City Property described in Exhibit E, attached hereto and incorporated herein by reference (“Easement Area”). The easement shall substantially comply with the form of easement appended to this Agreement as Exhibit F, attached hereto and incorporated herein by reference (“Easement”). The Easement shall include the following material terms:
4.1.1. T
he Easement shall provide that for so long as the Quarry and/or Quarry Operations are permitted and actually operated on the Syar Property, noise, dust, odor, vapors, vibration, illumination, and all other effects arising from operation under the Quarry Permit and as identified in the Environmental Impact Report supporting the Quarry Permit (or some combination thereof) shall be permitted to pass over the Easement Area, provided that such activities are in compliance with the Quarry Permit and all applicable laws and environmental restrictions.
4.1.2. T
he Easement shall terminate at such time as the legally permitted Quarry operations cease and/or the Quarry Permit expires, whichever occurs first, which easement termination/expiration shall be documented by a Quitclaim Deed executed by the Parties, acknowledged, and recorded in the Official Records.
4.1.3. The Easement described herein shall be appurtenant to, and shall pass with title to the Syar Property, and shall burden, and shall pass with title to, the portion of the City Property containing the Easement Area.
Each and all of the covenants, conditions and restrictions contained in the Easement: (i) shall run with the land; (ii) shall be binding upon, and shall inure to the benefit of the Parties, each owner and any person having or acquiring any interest in any portion of the City Property, containing the Easement Area or the Syar Property, and all of their respective heirs, successors, and assigns; and (iii) shall be binding upon the City Property or portion thereof, containing the Easement Area and the Syar Property.
4.1.4. N
othing in the Easement shall be construed to change or modify the existing location of the boundary between the City Property and the Syar Property. Any change to such boundary, or lot line adjustment shall be accomplished only in compliance with the Subdivision Map Act or other applicable statutory scheme.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 6 4.1.5. An agreed form of disclosure to future residential owners, if any, of any portion of the City Property shall be appended as an exhibit to the Easement (“Disclosure”), together with a copy of the staff report and Quarry Permit, which Disclosure shall be provided to prospective purchasers or tenants of any residential property located within the Easement Area.
4.1.6. I
n the event the Revised Project is approved for any combination of residential and commercial development, conditions of approval for the Project shall (i) identify the Easement and Disclosure as documents that shall be disclosed by Developer to prospective purchasers and tenants of the residential properties and purchasers and lessees of commercial properties in the Easement Area, and subsequent purchasers, tenants, or lessees of all of the foregoing, and (ii) require the recordation of the Easement prior to execution of a commercial lease or recordation of a subdivision map by Developer.
4.1.7. N
othing in the Easement shall limit the exercise of City’s police powers concerning health and safety issues.
5. The
City agrees that, consistent with the Site Preparation Agreement, in the event the Revised Project is approved by the City and actually constructed by Developer, City will undertake or cause to be undertaken the noticing and operational provisions relating to the Golf Course portions of the Revised Project as set forth in Exhibit H, attached hereto and incorporated herein by reference.
6. Thi
s Agreement shall not compel City to approve the Revised Project, or any other real estate development project based on the Development Applications and shall not compel Developer to pursue a Development Application, acquire any portion of the City Property, or perform any real estate development or construction activities based on the Development Applications and/or Land Plan. Rather, this Agreement provides only that if a Development Application is submitted by Developer for residential development on any portion of the City Property, such development shall be consistent with the Land Plan and the Buffer Zone. Notwithstanding anything else in this Agreement, if the City approves development inconsistent with the Land Plan and the terms of this Agreement, Syar shall not be bound by the terms of this Agreement; the terms of Sections 17 and 18 shall not apply and shall be deemed void ab initio; all applicable statutes of limitation shall be tolled during the time during which the entire Agreement was in full force and effect; and Syar may submit and pursue a new initiative, which new initiative may the same or substantially similar to the Initiative.
7. Th
e Parties acknowledge that this Agreement is not a project within the meaning of Public Resources Code Section 21065 because it is not an activity that has the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment. Rather, this DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 7 Agreement is intended to define the terms under which a project within the City Property may be applied for by Developer, and to outline some of the components of any proposed project Developer and Syar agree shall be included in the detailed project description prepared for the Revised Project and the Development Applications that may be submitted to City for consideration of approval of the Revised Project.
8. In r
esponse to any Development Applications submitted to City, City shall prepare a comprehensive environmental review document for the Revised Project that complies with CEQA.
9. To c
omply with CEQA and give the public the opportunity to be aware of the environmental consequences of the Revised Project, and to fully participate in the CEQA process, the Parties acknowledge that City has no obligation to consider the Revised Project unless and until the CEQA environmental review process and any other public review and hearing processes have been completed, subject to all applicable laws, rules, regulations and governmental approvals. Consistent with the provisions of this Agreement, including the Land Use and the Buffer Zone, City shall retain discretion in accordance with applicable law before action on the Revised Project is taken by the City to (i) identify and impose mitigation measures to mitigate significant environmental impacts, (ii) select other feasible alternatives to avoid significant environmental impacts, (iii) balance the benefits of the Revised Project against any significant environmental impacts prior to taking final action if such significant impacts cannot otherwise be avoided, or (iv) determine not to proceed with the Revised Project.
10. For
the avoidance of doubt, this Agreement shall not obligate or commit City to undertake (i) an acquisition of land, (ii) a disposition of land, or (iii) any other act or activity requiring the subsequent independent exercise of discretion by City. No agreement drafts, actions, deliverables, or communications arising from the performance of this Agreement shall impose any legally binding obligation on City to sell any portion of the City Property or be used as evidence of any oral or implied agreement by either City to enter into any other legally binding agreement with Developer or otherwise.
11. Thi
s Agreement does not limit in any way the discretion of City in acting on any applications for required permits or approvals for the Revised Project or any portion thereof, that may be applicable to the City Property, including the anticipated scope of the public improvements that may be associated with the Revised Project, provided however, that any such action by the City is consistent with the terms of this Agreement and its Land Use and Buffer Zone. The Parties acknowledge that compliance with CEQA will be required in connection with consideration of such permits and approvals required for the Revised Project or any portion thereof, including but not limited to development of any portion of the City Property, and that City shall retain the discretion in accordance with CEQA and other applicable law before taking action on any such permits or approvals to (i) adopt or certify an DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 8 environmental analysis of the Revised Project or any portion thereof, prepared in accordance with CEQA, (ii) identify and impose mitigation measures to mitigate significant environmental impacts, including the anticipated scope of required public improvements on the Revised Project, (iii) select other feasible alternatives to avoid significant environmental impacts, including the “no project” alternative, (iv) adopt a statement of overriding considerations in accordance with Public Resources Code Section 21081(b) relative to any significant environmental impacts of the Revised Project or any portion thereof, prior to taking final action if such significant impacts cannot otherwise be avoided, or (v) determine not to proceed with Revised Project or any portion thereof. Any action taken by City in the exercise of its discretion relating to any analysis required by CEQA or on any application for a permit or approval required to develop and construct the Revised Project or any portion thereof, shall not constitute a default or a breach of the terms of this Agreement by City, provided that such action is consistent with the terms of this Agreement and its Land Use and Buffer Zone.
12. With
in 5 calendar days of the Effective Date, Syar shall withdraw the City of Vallejo Parks, Recreation, and Open Space Protection Initiative and the Claim, and all other legal claims, if any, and Syar shall not put forward, sponsor, or financially support a similar initiative in the future.
13. In t
he event the Revised Project is approved, and from and after such time as the first certificate of occupancy is issued for any component of the Revised Project, Syar shall limit blasting events to weekdays unless it reasonably determines within the limits of the Quarry Permit that emergency conditions require aggregate production with blasting on a twenty-four (24) hours per day, seven (7) days per week schedule (e.g., the collapse of State Highway 680 or other emergencies as defined by the County of Solano, the State of California, or other agency with jurisdiction). For the avoidance of doubt, general market conditions and demand for the production of construction aggregates and /or associated products shall not constitute emergency conditions.
14. Syar s
hall donate to Developer, in kind, a total of One Million Dollars ($1,000,000) worth of aggregate base rock material over four years to be used in connection with implementation of the Revised Project. The value of said donation shall not exceed Two Hundred and Fifty Thousand Dollars ($250,000) in any calendar year beginning in 2022. The materials donated will be ¾” Class 2 Virgin Base Rock, 3” Minus (Black) and Pipe Bedding. The value of the materials shall be determined by the list price of SYAR in effect at the time of the delivery of materials.
15. Sya
r shall affirmatively support the Revised Project and not oppose residential development on the City Property, including without limitation the filing of, sponsorship of, or participation in a lawsuit filed under CEQA, provided that such development is consistent with the requirements of this Agreement, including the Land Plan and Buffer Zone. The terms of this Section do not apply to any project alternatives or other development proposals submitted during administrative DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 9 proceedings for the Revised Project that are inconsistent with the Land Plan or Buffer Zone, and Syar may oppose such alternatives or other development proposals without limitation.
16. City
and Developer shall not oppose, delay, or otherwise object to any application that may be made by Syar to the County regarding a future expansion of the Quarry, provided however, that such expansion does not extend westerly of a north-south longitudinal line intersecting the westernmost point on the boundary of the Expanded Quarry Area from the 2014 Use Permit as shown in Exhibit G, attached hereto and incorporated herein by reference.
17. Ex
cept as to such rights or obligations as provided herein and as otherwise provided in this Agreement, the Parties and each of their representatives, agents, principals, partners, affiliates, joint venturers, attorneys, administrators, executors, successors and assigns hereby unconditionally release, acquit and forever discharge the other Parties, and each of their representatives, agents, principals, partners, affiliates, joint venturers, attorneys, administrators, executors, successors and assigns from any and all claims, including the Claim, and any and all demands, injuries, actions, causes of action, either at law or in equity, or of any kind, nature, or description, known or unknown, which any of them has had or now has against any other Party upon or relating, directly or indirectly, to the facts and legal issues regarding the matters contained herein.
18. The
Parties hereto specifically and knowingly waive all rights any of them have or may have pursuant to California Civil Code section 1542, which states as follows:
“A g
eneral release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”
Th
e Parties represent and warrant that they have been advised by their respective attorneys of the meaning of Section 1542 of the California Civil Code, and the implications of waiving the protections thereof.
19. Any di
sputes between the Parties concerning any alleged breach of this Agreement shall be subject to the dispute resolution procedures set forth below. The Parties covenant and agree that, if any Party believes another Party is in violation of one or more terms of this Agreement, the Party shall provide written notice to all other Parties specifying the actions or inactions it deems to be in violation of this Agreement. Within thirty (30) days of receipt of such notice, the Party or Parties subject to the notice shall respond to the notice in writing. If the Parties still dispute compliance with this Agreement after completing the notice process, the Parties shall meet and confer in a good faith attempt to resolve their dispute within 30 days.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 10 20. If the Parties cannot informally resolve the dispute pursuant to the procedures set forth immediately above, any Party may seek relief in Solano County Superior Court.
In the event any Party files a complaint to enforce its rights under this Agreement, the relief the reviewing court is empowered to award is limited to injunctive relief requiring the Parties to take the relevant action(s) specified in this Agreement, and each party shall bear its own attorney’s fees and costs incurred in such a proceeding.
21. Thi
s Agreement shall be interpreted under the laws of the State of California. The Parties hereto agree that money damages may be an inadequate remedy for any breach (or threatened breach) of this Agreement and agree that the same may be enforced by a preliminary or permanent, mandatory, or prohibitory injunction, by a decree of specific performance, or other such order or decree of a court of competent jurisdiction. Each Party to this Agreement waives and releases any claim or defense that any term hereof is not enforceable and acknowledges that it is estopped to challenge the enforceability of any of its provisions.
22. Ea
ch of the persons signing this Agreement on behalf of an entity represents and warrants that he or she has actual authority and capacity to execute this Settlement and Release Agreement on behalf of the entity and to bind it to all the terms hereof.
23. Thi
s Agreement is entered into and is to be performed in Solano County, California and shall be governed and construed in accordance with the laws of the State of California and is binding upon the Parties.
24. Th
e Parties and their respective counsel have carefully and fully read and reviewed this Agreement. The Parties hereby represent that the contents of this Agreement are understood and agree that this Agreement is binding on each Party or its respective members, representatives, predecessors, successors, and assigns and as described herein. This Agreement is entered into voluntarily, free of undue influence, coercion, duress, menace, or fraud of any kind. No Party, nor any member, officer, agent, employee, representative, or attorney of or for any Party, has made any statement or representation to another Party regarding any fact relied upon in entering this Agreement, and no Party to this Agreement is relying upon any statement, representation, or promise another Party, nor of any member, officer, agent, employee, representative, or attorney of or for another Party, in executing this Agreement or in making the settlement provided herein, except as expressly stated in this Agreement.
25. The
provisions of this Agreement comprise all the terms, conditions, agreements, and representations of the Parties respecting the matters herein described. This Agreement may not be altered or amended, and no provision hereof may be waived, except by written agreement executed by the Parties, or their representative if notice of counsel is given, to be bound. The Parties hereby agree that the terms of this Agreement have not been changed, modified, or expanded by any oral agreements or representations entered into or made prior to or at the execution of this Agreement.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 11 26. This Agreement may be executed in multiple counterparts, each of which shall evidence one and the same document.
27. Thi
s Agreement may be modified only by express written consent of all Parties to this Agreement.
28. Thi
s Agreement, and each of its provisions, including all representations, warranties, and promises contained herein, binds, and inures to the benefit of the Parties, and each of their respective representatives, officers, directors, partners, heirs, executors, assigns, present and future affiliates, subsidiaries, predecessors and successors in interest whether by merger, consolidation, or otherwise, as well as their respective representatives, agents, and administrators, past, present, and future.
29. Thi
s Agreement and its terms shall inure to the benefit of and be binding upon each of the Parties hereto and each and all of their respective representatives, successors, assignees, buyers, grantees, vendees, or transferees with respect to the Project or any portion of the Project, and shall survive the transfer of the property upon which any components of the Project are located to any entity that acquires title to such property whether by sale, lease or other transfer, or contribution to partnership, joint venture or any other entity.
30. The
invalidity or unenforceability of any provision of this Agreement shall in no way affect the validity or enforceability of any other provision. If, in any action before any court or other tribunal of competent jurisdiction, any term, restriction, covenant, or promise is held to be unenforceable for any reason, then such term, restriction, covenant, or promise shall be deemed modified to the extent necessary to make it enforceable by such court or other tribunal. Any such modification or amendment in any event shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such adjudication is made. If the Agreement cannot be modified to make it enforceable by such court or other tribunal then, notwithstanding anything else in this Agreement, the Party denied the benefit of such term, restriction, covenant, or promise may enforce any and all actions, causes of action, suits, losses, liabilities, rights, debts, dues, sums of money, accounts, reckonings, obligations, costs, expenses, liens, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, and demands contemplated in Sections 17 and 18 of this Agreement, including the Claim, and all applicable statutes of limitation shall be tolled during the time during which the entire Agreement, consistent with the above, was in full force and effect. Under the aforesaid circumstances and to the extent Syar is denied the aforementioned benefits, Syar may pursue a new Initiative which new initiative may the same or substantially similar to the Initiative.
31. Exc
ept as otherwise expressly stated herein, all notices, requests, demands and other communications (collectively, “Notice”) which the Parties are required or desire to serve upon or deliver to the other party shall be in writing and shall be given by nationally recognized overnight courier, by certified United States mail, return receipt DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 12 requested, postage prepaid, addressed as set forth below, or by electronic mail addressed as set forth below:
SYAR: P
aul Aherne
Counsel for Syar Industries, Inc.
PO Box 2540
Napa, CA 94558
paherne
@syar.com
CITY: C
ity Manager
555 Santa Clara Street
Vallejo, CA 94590
Veron
ica A. F. Nebb
City Attorney
555 Santa Clara Street
Vallejo, CA 94590
Veroni
[email protected]
DEVELOP
ER:
Blue Rock, LLC
c/o Jeb Elmore
Vice President - Acquisitions
Lewis Management Corp.
9216 Kiefer Blvd.
Sacramento, CA 95826
[email protected]
The for
egoing addresses may be changed by Notice given in accordance with this paragraph. Any Notice sent by certified mail shall be deemed received on the date shown in the proof of delivery. Any Notice sent by electronic mail shall be deemed received upon electronic transmission thereof provided that the sender does not receive electronic notice of non-delivery.
Any Notice sent by overnight courier service shall be deemed received on the day of actual delivery as shown by the confirmation of delivery by the messenger or courier service. If the date of receipt of any Notice to be given hereunder falls on a weekend or legal holiday, then such date of receipt shall automatically be deemed extended to the next business day immediately following such weekend or holiday for purposes of calculating time periods commencing upon the date of service.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 13 By: _________________________________
Dated: ____________, 2022
BLUE ROCK SPRING S, LLC
By: _________________________________
Douglas Mull
Its: Authorized Signatory
Dated: ____________, 2022 CITY OF VALLEJO,
A Municipal Corporation
By: _________________________________
Michael Malone
City Manager
Approved as to form:
By: ______________________
___________
Veronica A. F. Nebb
City Attorney
(City Seal)
ATTEST:
By: ________________________
Dawn Abrahams
on
City Clerk
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement effective as of the date written above.
SYAR INDUSTRIES, INC.
James M. Syar
Chief Executive Officer
Dated: ____________, 2022
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 7/29/2022
7/29/2022
8/1/2022
EXHIBIT A
[Insert
legal description of City Property, consisting of APNs 0081-040-100; 0081-040-110; 0081-040-880; 0081-191-010; 0181-190-010; 0181-190-070; and 0182-040-080 in a format acceptable for recording.]
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT B
Land Pl
an
1. The Land Pl
an shall include a buffer zone, as depicted in Exhibit C to maintain separation between the Quarry and all other future development. The Buffer Zone as depicted in Exhibit C and described in Exhibit D affects future residential and commercial development within one-half mile of the Quarry Area throughout the term of the Quarry Permit and any extension to the Quarry Permit as may be approved by Solano County in the future. Specifically, (a) the maximum development footprint for residential uses within the one-half mile radius of the Quarry Area is depicted as the orange area shown on the Buffer Zone map (Exhibit C). (b) the maximum development footprint for commercial uses within the one-half mile radius of the Quarry Area is depicted as the red area shown on the Buffer Zone map (Exhibit C); (c) No residential uses shall be allowed east of Columbus Parkway but are not excluded from the orange area west of Columbus Parkway; and (d) Any future clubhouse east of Columbus Parkway shall be within 300 feet of the Parkway and no further north than the existing clubhouse. The Buffer Zone shall not in any way preclude outdoor golf uses.
2. There
shall be no residential development on the east side of Columbus Parkway; residential development may be accommodated within the Buffer Zone. west of Columbus Parkway.
3. Any cl
ubhouse that is to be part of the Revised Project that is proposed to be sited on the east side of Columbus Parkway shall be sited no more than three hundred feet (300’) east of Columbus Parkway, and no further north than the existing clubhouse building. The clubhouse design shall avoid use of large east or northeast-facing unprotected picture windows. The Proposed Project shall include that all windows shall be constructed using safety glass and comply with recommendations of a qualified engineer.
4. The Rev
ised Project shall be designed such that outdoor activities and gatherings involving more intensive use by people be shielded from direct exposure to the Quarry and Quarry Operations by the clubhouse building and/or reinforced masonry walls.
5. The La
nd Plan shall include an eight foot (8’) tall (as measured from highest adjoining grade), reinforced masonry wall or building walls with no openings, to be placed along the eastern boundary of any commercial site located east of Columbus Parkway.
Unprotected windows shall not face the East or Northeast (i.e., in line with potential rock fall).
6. The des
ign of the structures of the commercial development shall be either masonry construction or an approved alternative which is found by a qualified engineer to reduce interior noise levels to mitigate for quarry noise, and be resistant to potential damage from rockfall and vibration associated with ongoing Quarry Operations.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
7. All commercial use customer and employee parking shall be located westerly of the commercial buildings.
8. Developer shall include as part of the Development Application for the Revised Project conditions that require that all outdoor activity related to commercial development in the red area depicted on Exhibit C, including that on any portion of the City Property transferred to developer, such as outdoor seating, and outdoor activities associated with any clubhouse special event, subject to final center design and the placement of these sensitive uses, may be subject to cancellation based upon blasting schedules provided by the Quarry Operator, consistent with Exhibit H. The Quarry Operator is to provide a minimum of 48-hour notice to Developer of blasting events.
9. The Developer’s final application for the commercial center design shall be subject to review by the Quarry operator’s environmental planners to confirm consistency with these measures.
10. Developer’s final application shall include proposed conditions that t he Developer must:
(1) ensure that commercial leases and sales include a deed restriction providing notice of Quarry Operations; and (2) a requirement that commercial uses other than the golf course, should temporarily suspend all outdoor activities during scheduled blasting events.
11. The Land Plan shall be consistent with the Buffer Zone in Exhibit C . Accommodation of either fewer residential or commercial acres than depicted by the “Maximum Development” footprint shown in Exhibit C shall be considered consistent for purposes of the Land Plan, provided that separation of such uses from the Quarry meet the specifications in Exhibit C.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT C
Buf
fer Zone (open space and urban footprints)
Reflects Maximum Development Footprint for Residential and Commercial Uses.
No Residential Uses within (Green) Buffer Zone Boundary East of Columbus Parkway.
Any Future Clubhouse East of Columbus Parkway to be within 300 Feet of the Parkway and No Further North than the Existing Clubhouse.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT D
[Inser
t legal description/depiction of City Property affected by Buffer Zone.] City Property Affected By Buffer Zone
That certain real property consisting of approximately 255 acres of land located adjacent to the Syar Property consisting of APNs 0081-040-110, 0181-190-010, 0181-190-070, and 0182-040-080 and a portion of 0081-040-880 and a portion of 0081-191-010.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT E
[Inser
t legal description of Easement Area.]
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT F
(See attached)
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
CITY OF VALLEJO
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Manager
_____________________________________________________________________________ (Space above line for Recorder’s use only)
APNs: 0081-040-100 0081-040-110 0081-191-010 0182-040-080 0181-190-010 0181-190-070 0081-040-880
Property
Address: None
COLLAB
ORATIVE USE EASEMENT
The undersi
gned declares that the document to which this page is affixed and made a part of is exempt from the fee imposed by the Affordable Housing & Job Act (SB2) (GC 27388.1) and Restrictive Covenant Modification (GC 27388.2)
( ) Recor
ded [concurrently] in connection with a transfer of real property subject to the imposition of Documentary Transfer Tax per GC 27388.1 (a) (2) & Gov’t Code 27388.2(b). ( ) Rec
orded [concurrently] in connection with a transfer of real property that is residential dwelling to an owner-occupier per GC 27388.1(a)(2) & Gov’t Code 27388.2(b). ( ) Ma
ximum fee of $225 has been reached per GC 27388.1(a)(1). ( ) Not
related to real property GC 27388.1(a)(1).
( ) Tr
ansfer of real property subject to the imposition of Documentary Transfer Tax - GC 27388.1(a)(2) and 27388.2(b).
( ) Tr
ansfer of real property that is a residential dwelling to an owner-occupier - GC 27388.1(a)(2) and 27388.2(b).
( ) Docum
ent is executed or recorded by the state or any county, municipality, or other political subdivision of the state – Gov’t Code 27388.1(a)(2) & Gov't Code 27388.2(b).
THIS PA
GE ADDED TO PROVIDE EXEMPTION INFORMATION FOR THE BUILDING
HOMES AND JOBS ACT FEE
(SB-2; AFFORDABLE HOUSING FEE) ($3.00 Additional recording fee applies) and Restrictive Covenant Modification Fee ($2.00 Additional recording fee applies) DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
18719286.1
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
CITY OF VALLEJO
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Manager
_____________________________________________________________________________ (Space above line for Recorder’s use only)
APNs: 0081-040-100 0081-040-110 0081-191-010 0182-040-080 0181-190-010 0181-190-070 0081-040-880
Property
Address: None
The undersi
gned grantor(s) declare(s):
Documentary Transfer Tax is: $0.00 [Cal. Rev. & Tax. Code § 11911 [easement + consideration less than $100] ( ) computed on full value of property conveyed, or
( ) computed on full value of less of liens and encumbrances remaining at time of sale. ( ) unincorporated area: ( ) City of Vallejo
( ) Signature of Declarant
_______
_________________________________________
By:
Its:
COLLAB
ORATIVE USE EASEMENT
This Collaborative Use Easement (“ Easement”) is made and entered into by and between BLUE ROCK SPRINGS, LLC, a Delaware limited liability company and the CITY OF VALLEJO (Collectively, “Grantor”) and SYAR INDUSTRIES, INC., a California corporation (“Grantee”), is dated for reference purposes as of August 1 , 2022 and shall be effective on the date it is recorded (“Effective Date”) in the Official Records for the County of Solano (“Official Records”). Grantor and Grantee are referred to collectively herein as the “ Parties;” each of Grantor and Grantee is referred to individually as a “Party.”
The Parties do hereby agree as follows:
RECITALS
A. Grantor is the record owner of that certain real property that was formerly a portion of the Blue Rock Springs golf course, commonly known as 655 Columbus Parkway, Vallejo, California, also known as Solano County Assessor’s Parcel Number s (“APNs”) 0081-040-100, 0081-040-110, 0081-040-880, 0081- 191-010, 0181- 190-010, 0181- 190-070, and 0182-040-080, containing approximately 260 acres (“Burdened Property”). The Burdened Property as further described in Exhibit A, appended hereto and incorporated by this reference , is located adjacent to the Quarry Property, described below and is therefore subject to this Easement.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
B. Grantee is the record owner of that certain real property located immediately east of the Burdened Property, in the unincorporated area of Solano County, which property, is commonly known as 885 Lake Herman Road, Vallejo, California, consists of APN 0181-190-060 and portions of 181-210-030 and 181- 220-040, California, and is further described on Exhibit B, appended hereto and incorporated by this reference (“Quarry Property”). The Quarry Property is the subject of that certain Land Use Permit No. U -08-09 and Reclamation Plan No. RP -08-01, Mitigation Monitoring Plan, and conditions of approval, issued by the County of Solano on or about December 4, 2014, as it may be amended as set forth in Section 3(b)(collectively, “Quarry Permit”).
C. The Parties to this Collaborative Use Easement entered into a Settlement Agreement effective as of August 1, 2022 ("Settlement Agreemen t") with Blue Rock Springs, LLC (“Developer”) concerning ongoing operations on the Quarry Property and the effects of those operations on the Burdened Property as to be conveyed to Developer by Grantor.
D. Certain activities are and will continued to be carried out in, on, and around the Quarry Property, pursuant to and in compliance with the Quarry Permit, including without limitation the generation of noxious odors, truck traffic, vibrations, noise, illumination, glare, dust, vapors, smoke, electrical disturbances, and other impacts, which shall be permitted to pass over and through the Burdened Property at levels and during hours that residents and other occupants of the Burdened Property may find disturbing or harmful, or which may create difficulties with activities that include sleeping, eating, and relaxation.
E. The Burdened Property is intended to be developed with certain residential and commercial development, all of which is more fully described in the Settlement Agreement.
F. The Quarry Property contains an active quarry pit, an asphalt plant, a rock processing plant, a concrete batch plant, and other related operations authorized under Quarry Permit (collectively the “Quarry Operations”).
G. The intent of this Easement is to ensure and facilitate t he ongoing operation of the Quarry Property in compliance with the Quarry Permit, while at the same time furthering the goals of the City of Vallejo’s General Plan, including without limitation the those goals, policies, and programs stated in the City of Vallejo’s Housing Element, e.g. , (1) facilitating production of housing to accommodate Vallejo’s fair share of regional housing demand, (2) increasing home ownership opportunities; (3) providing housing choice for Vallejo residents; and (4) building and ma intaining quality residential environments. More specifically, this Easement is intended to maintain Grantee’s ability to conduct and continue to conduct the Quarry Operations, including those external effects as disclosed in the Environmental Impact Report certified by Solano County supporting the Quarry Permit, while facilitating the development and occupation of residential and commercial uses by informed and consenting individuals who may wish to reside within or otherwise use or occupy the Burdened Property notwithstanding its proximity to the Quarry Property, and despite its industrial character and effects.
H. Grantor and Grantee understand and agree that the paragraphs above are not mere recitals, but are a substantive and meaningful part of this Easement.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties agree as follows:
1. Grant of Easement . Grantor hereby conveys to Grantee an easement over the Burdened Property, on the conditions stated in this Easement, so that Grantee may continue to pursue Quarry Operations as allowed by the Quarry Permit , including without limitation the generation of noxious odors, truck traffic, vibrations, noise, illumination, glare, dust, vapors, smoke, electrical disturbances, and other impacts which shall be permitted to pass over and through the Burdened Property without any interference or assertion of a nuisance by Grantor, and irrespective of the conduct of residential, commercial and/or other activities on the Burdened Property. The Easement shall benefit all property now owned by Grantee or their successors or assigns on which the Quarry Operations are allowed by the Quarry Permit on the Quarry Property.
2. Easement Appurtenant; Binding on Successors.
a. Each and all of the covenants, conditions and restrictions contained in this Easement (a) shall run with the land ( i.e., title to the Quarry Property and Burdened Property , and each of them); (b) shall be binding upon, and shall inure to the benefit s and burdens of the Parties, each owner and any person having or acquiring any interest in any portion of the Quarry Property and Burdened Property, or either of them, and all of their respective heirs, successors, and assigns; and (c) shall be binding upon, and shall inure to the benefit of the Quarry Propert y and Burdened Property, and each of them, and each parcel thereof, and every portion thereof and interest therein. b. This Easement shall be prima facie evidence that Grantor and its successors and assigns acknowledge and accept the ongoing conduct and effects of the Quarry Operations as allowed by the Quarry Permit. It shall be admissible in any court of law, mediation and/or arbitration as a binding agreement, made based on an exchange of good and valuable consideration.
3. Covenant by Grantee; Compliance with Laws.
a. Grantee hereby covenants and agrees that Grantee shall at its sole cost and expense, comply with all conditions on the issuance of the Quarry Permit , as well as applicable laws, rules, requirements, ordinances, orders, directions, regulations, and/or environmental restrictions of any governmental or lawful authority affecting, regulating or as it may be amended and extended from time to time, and all applicable laws of Solano County related to the Quarry Operations and/or the Quarry Permit (collectively, “Governmental Laws”).
b. Grantor and its successors and assigns shall not oppose, delay, or otherwise object to any application that may be made by Grantee to the County regarding extension of the duration of Land Use Permit No. U -08-09 and Reclamation Plan N o. RP -08-01, Mitigation Monitoring Plan, and conditions of approval, issued by the County of Solano on or about December 4, 2014 or a future expansion of the Quarry, provided however, that such expansion does not extend westerly of a north-south longitudinal line intersecting the westernmost point on the boundary of the Expanded Quarry Area from the 2014 Use Permit as shown in Exhibit F, attached hereto and incorporated herein by reference.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
4. Term of Easement.
a. This Easement shall commence on the Effective Date. Grantor and Grantee agree to cause the recordation of this Easement in the Official Records concurrently with the recordation of any grant deed, or other similar instrument, intended to convey or transfer all rights, title and interest in and to the Burdened Property, or a portion thereof, to Developer as contemplated under the Settlement Agreement or any third party . For avoidance of doubt, Grantor and Grantee agree that, with respect to the order of recordation, this Easement shall be recorded immediately after the grant deed that conveys the Burdened Property, or a portion thereof, to Developer or a third party. b. Grantor acknowledges that this Easement is imposed on the Burdened Property for the direct benefit of Grantee. Accordingly, the Easement shall continue in full force and effect for so long as the Quarry Operations are allowed by the Quarry Permit are ongoing and shall terminate at such time as the Quarry Permit expires.
c. At such time as this Easement is terminated, Grantee shall execute and cause to be recorded in the Official Records a document that quitclaims Grantee’s interest in the Easement or otherwise terminates and acknowledges the termination of this Easement , which document shall be substantially in the form attached hereto as Exhibit C.
5. Disclosure to Future Owners and Lessors of the Burdened Property . Grantor and Grantee contemplate that the Burdened Property, and/or portions thereof may be offered for sale to third parties for further development and/or ownership and/or occupancy of residential dwelling units and commercial structures in accordance with the Settlement Agreement. Accordingly, Grantor covenants and agrees that it shall provide to prospective buyers of Grantor’s respective properties (a) a copy of this Easement, (b) a copy of the Disclosures to Potential Buyers (appended to this Easement as Exhibit D and incorporated herein by this refer ence), (c) a copy of the Quarry Permit, and (d) a copy of the December 4, 2014 Staff Report prepared by the Solano County Department of Resource Management Planning Services Division in connection with the Quarry Permit, for the benefit of the Solano County Planning Commission (“ Staff Report”) (a true and correct copy of the first 18 pages of the Staff Report is appended to this Easement as Exhibit E and incorporated herein by this reference).
6. No Change of Boundary . Nothing in this Easement shall be construed to change or modify the existing location of the boundary line between the Burdened Property and the Quarry Property. Any change to such Boundary, or lot line adjustment shall be accomplished only in compliance with the Subdivision Map Act or other applicable statutory scheme.
7. Dispute Resolution. Any claim or controversy between the Parties which relates to or arises from this Easement , the rights and obligations conferred thereby (“ Dispute”), shall be resolved as provided herein:
a. Good Faith Negotiations . The Parties shall meet no later than twenty (20) calendar days following receipt of written request to meet signed by any Party and delivered to the other Party (the “Resolution Notice”). The Parties shall negotiate in good faith in an effort to resolve the Dispute. If the Parties cannot resolve the claim within twenty (20) calendar days following the date of the Resolution Notice or if any Party to the Dispute fails to meet as required by this Section 7, the Parties agree that the Dispute shall be submitted to mediation as provided below.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
b. Mediation.
i. In the event of unsuccessful or incomplete Good Faith Negotiations, all disputes shall next be submitted to nonbinding confidential mediation by written notice by one of the Parties to another Party and shall be treated as compromise and settlement negotiations under the standards set forth in the Federal Rules of Evidence and all applicable state counterparts, together with any applicable statutes protecting the confidentiality of mediations or settlement discussions. If the Parties cannot agree on a medi ator, ADR Services, Inc. shall, at the written request of a Party , designate a mediator. The person who acts as mediator shall not act as arbitrator without the written consent of the Parties.
ii. If either of the Parties (A) commences any legal action witho ut first having attempted to resolve the Dispute through mediation, or (B) refuses to mediate after a request has been made, that Party shall not be entitled to recover attorneys’ fees incurred in connection with such Dispute, even if such recovery would otherwise be available in such action. The filing of an action to preserve a statute of limitations, to enable the recording of a notice of pending action/lis pendens, or for provisional remedies (i.e., a temporary restraining order) shall not constitute a waiver or violation of these mediation requirements. Notwithstanding the foregoing, the party seeking injunctive relief will not be required to submit such claim to mediation as set forth herein but may proceed to file such claim in any court of competent jurisdiction.
8. Entire Agreement. This Easement is the entire agreement between the Parties with respect to the matters described herein. No prior agreement, statement or promise made by either Party shall be binding or valid.
9. Amendments. Grantor and Grantee may amend this Easement only by written amendment signed by both Parties.
10. Assignment. The covenants, conditions, and restrictions contained in this Easement are intended to run with the land and to bind all future owners of any interest in, as applicable, Burdened Property or the Quarry Property. Any subsequent transferee shall, by acceptance of title, be deemed to have assumed the obligations of this Easement and to have accepted the restrictions contained herein.
11. Construction. This Easement shall be governed by the laws of the State of California.
This Easement shall be construed as if both Parties (or their counsel) prepared it.
12. Notices. Except as otherwise expressly stated herein, all notices, requests, demands and other communications (collectively, “ Notice”) which the Parties are required or desire to serve upon or deliver to the other Party shall be in writing and shall be given by nationally recognized overnight courier, by certified United States mail, return receipt requested, postage prepaid, addressed as set forth below, or by electronic mail (if acknowledged following delivery) address ed as set forth below:
TO GRANTOR: TO GRANTEE:
Blue Rock Springs, LLC
c/o Jeb Elmore
Syar Industries, Inc.
c/o Roni Krueger
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
Vice President - Acquisitions
Lewis Management Corp.
9216 Kiefer Blvd.
Sacramento, CA 95826
Blue
Rock Springs, LLC
c/o Lewis Management Corp.
1156 N. Mountain Avenue
Upland, CA 91786
2301 Napa Vallejo Highway
Napa, CA 94558
COPY TO: COPY TO:
Corie A. Edwards, Esq.
Reuben, Junius & Rose LLP
One Bush Street, Suite 600
San Francisco, CA 94104
City
of Vallejo
City Manager
555 Santa Clara Street
Vallejo, CA 94590
COPY
TO:
City
of Vallejo
City Attorney
555 Santa Clara Street
Vallejo, CA 94590
Paul Aherne, Esq.
PO Box 2540
Napa, CA 94558
13. Counterparts. This Easement may be executed in counterparts with the same force and effect as if executed in the form of a single document.
14. Article and Section Headings . The headings of the articles and sections in this Easement are inserted solely for convenience or reference, an d are not intended to govern, limit or aid in the construction of any term or provision hereof.
15. Waiver.
a. No claim of waiver, consent or acquiescence with respect to any provision of this Easement shall be made against either Party except on the basis of a written instrument executed by or on behalf of such Party.
b. Either Party’s consent to or approval of any act by the other Party requiring such Party’s consent or approval shall not be deemed to waive of render unnecessary such Party’s consent to or approval of any subsequent act by the other Party.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 18719286.1
16. No Agency. Nothing in this Easement shall be construed as permitting or authorizing either Party to act in any capacity as an agent of the other. A ny intention to create a joint venture, partnership or principal and agent relationship between the Parties is hereby expressly disclaimed.
This Easement shall create the relationships of Grantor and Grantee only, subject to the limitations herein.
17. Time of the Essence. Time is of the essence with respect to this Easement.
18. Authority. Each person signing this Easement on behalf of either Grantee or Grantor warrants and represents to the other Party that such person is duly and fully authorized to enter into this Easement on behalf of such entity, that this Easement will be binding upon such entity and its constituent members and that the execution of this Easement has been approved and ratified as required by the organizational documents of such entity.
19. Survival of Terms . This Easement and its terms shall survive the transfer of the Burdened Property, or any portion thereof, to Developer or any other entity that acquires title to such property whether by sale, lease or other transfer, or contribution to partnership, joint venture or any other entity.
20. Severability. The invalidity or unenforceability of any provision of this Easement shall in no way affect the validity or enforceability of any other provision. If, in any action before any court or other tribunal of competent jurisdiction, any term, restriction, covenant, or promise is held to be unenforceable for any reason, then such term, restriction, covenant, or promise shall be deemed modified to the extent necessary to make it enforceable by such cour t or other tribunal. Any such modification or amendment in any event shall apply only with respect to the operation of this Easement in the particular jurisdiction in which such adjudication is made. [Signatures on the following page]
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Signature Page to Collaborative Use Easement
18719286.1
IN WITNESS WHEREOF, the Parties have executed this Collaborative Use Easement as of the date and year first above written.
Dated: ___________ SYAR INDUSTRIES, INC.
_____________
_______________________
By: James M. Syar
Its: Chief Executive Officer
Dated: __________ BLUE ROCK SPRINGS, LLC
___________________________________
By: Douglas Mull
Its: Authorized Signatory
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Exhibit A to Collaborative Use Easement
18719286.1
Ex
hibit A to Collaborative Use Easement
Legal Description – Burdened Property
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Exhibit B to Collaborative Use Easement
18719286.1
Exhibit B to Collaborative Use Easement
Legal Description – Quarry Property
Approximately 468-acres located at 885 Lake Herman Road, immediately east of the City of Vallejo and within the Solano County "A -20," Exclusive Agricultural zoning district, consisting of APNs:
0181-190-060, 0181-220-040, 0181-210-030 and 0181-200-010.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Exhibit C to Collaborative Use Easement
18719286.1
Exhibit C to Collaborative Use Easement
Form of Termination of Collaborative Use Easement
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Exhibit D to Collaborative Use Easement
18719286.1
Exhibit D to Collaborative Use Easement
Disclosures to Potential Buyers
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Exhibit E to Collaborative Use Easement
18719286.1
Exhibit E to Collaborative Use Easement
December 4, 2014 Solano County Department of Resource Management Planning Services Division Staff Report (First 18 Pages)
(See attached)
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
DEPARTMENT OF RESOURCE MANAGEMENT
Planning Services Division
STAFF REP'ORT
Phone (707) 784-6765
Fax (707) 784-4805
www.solanocounty.com
Mike Yankovich
Program Manager
Agenda Item No. 1
To: Solano Cou nty Plann ing Comm ission
From: Kar en Avery, Seni or Planner
Su bject: Use Per mit No. U-08-0 9/Recl ama tion Plan RP-08-0 1 for Syar In dustries, Inc. Lake Herman Qua rry expan sion project lo cated at 885 Lake Herman Road, Vall ejo, adjacent to the City of Vallejo, in an "A-20" Exclus ive Agricu ltu ral Zonin g Di strict Date: December 4,20 14
I. RECOMMENDATION:
The Planning Commi ssion ADO PT the proposed Resol ution CE RTIF YING the Final Envir onm en tal Im pac t Repor t for the Lake Herm an Expansion Project, and ADOP T the prop osed Resolu tion APPROVI NG the Use Permit No. U-08-09 and Recla ma tion Plan RP-08-0 1, ba sed on the recom mended Findings and sub jec t to the rec omm ended Condi tions of Appr oval attached ther eto , and ADOP TING the Mitig ation and Mon ito ring Plan as recom mended by staff.
II. ACTION REQUESTED:
Use Per m it and Recl ama tion Plan for the expa nsion and conti nu ation of surface min ing and reclama tion activiti es for aggreg ate proce ssi ng, agg reg ate produc t manu factur in g, including expa nding the qu arry pit to 21 1 acr es, decr easing the dep th of the quar ry pit to 0' mean sea leve l, changi ng the al lowab le hour s of op eration, and cont inuin g the sale of 3.0 million tons of ma terials per year for an addi tional 35 year s. .
III. ENVIRONMENTAL ANALYSIS:
An En viro nme ntal Im pac t Repor t was prepar ed and ci rcu la ted for the Lak e Her man Quar ry Expa nsion Projec t. The Draft EIR was published for a 45-day public review and co mme nt period be gin ning July 19 , 201 3 and ending Sep te mber 4, 20 13 . The Fi nal EIR was dis tri bu ted more than 10 da ys pr ior to the an ticipa ted certifi cation da te . Mi tig ation Meas ures ar e iden tifi ed for the projec t to redu ce impac ts to a les s-th an-sign ifican t le ve l.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/R P-08-01 Staff Repor t
IV. PROJECT MAP
L_J Project Site
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.. .• ..• Expansion Area
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Project Vicinity
Job Numt;.:r I 117.; 10GoOO I
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DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar In dustries, In c.
U-0 8-09 /R P-08- 0 1 Staff Rep ort .
v. BACKGROUND:
A. Prior approvals: See Ba ckg round Discussion Belo w
B. Applicant/Owner: Syar In dustr ies , In c.
c. General Plan land use designation/zoning: Ag ricultur e and Excl us ive Ag ricu ltu re (A- 20)
D. Existing use: Rangeland /Rock Quar ry, Agg regate Proces sing and Recy cling E. Adjacent zoning and uses:
North: Ag ricultur e (A-20) - Open Space/Ag ricul tura l South: Ag ricultur e (A-20) - Open Spa ce/Ag ricultural East: Ag ricu ltur e (A-20) - Ag ricu ltur al/G razing
West: Ci ty of Va lle jo - Gol f Cour se
Lake Herman Quarry Background
The Lake Her ma n Qua rry area has been mined sinc e the early 18 70's . In the 19 40's , com mer cial mining op erati ons beg an and conti nu ed on a small scale un til 19 65 when Syar In dustries acquir ed the qua rry .
In 19 68, an asp hal t con crete (asphalt pavi ng ma ter ial) ba tch plant was added to the oper ati on. On May 17 , 19 79, the Plan nin g Comm ission ap proved Use Pe rmit U-78- 09, Recl ama tion Plan RP-7 8-03 and Variance V-78-0 1 for the conti nued mi ning of over 1, 000, 000 tons of rock per year and the reclama tion of the 38 6+/- acr e site and a vari anc e to allo w slop e gr adien ts ste eper than 2: 1. As part of these ap prova ls, an En vironmen tal Im pac t Re por t was prepar ed and certified by the Planning Com rnis sion. Subseq uently , in 19 94, a separate Use Permit U-93-2 9 to oper ate a recycle plan t to recycle broken asphal t and con crete paving was appr oved by the Planning Commissi on. In Dec em ber 20 01 , the Planning Commis sion app roved an amende d Use Per mit (U-97 -1 6) and Rec lama tion Plan (RP-97- 01 ) to reflect a revised de pth of mining to 200 feet above mean sea level and to add an ove rbur den storage ar ea across the stre et (La ke Her man Road) to ano the r par cel own ed by Syar. A Mit iga ted Neg ative Declar ati on was adop ted by the Pl anning Comm ission for tha t project.
Per the exis ting condi ti ons of ap prova l of these perm its , curre nt oper ati ons at the quar ry are due to exp ire in 20 14 . In April of 2008, a Use Per mi t Appl ica tion and Recl ama tion Plan were submi tted to the Cou nty to expand and exte nd the existi ng quar ry oper ati ons.
Project Location and Setting
Lake Her man Quar ry is lo cated on the slo pes of the Sulphur Sp rings Mount ain , ju st ou tside the Ci ty limi ts of Va lle jo adjac en t to Lak e Her ma n Road. The projec t site encomp asses appr oxima tely 468 ac res of land in the so uthwestern portion of uninc or po rated Solano Coun ty. Appr oxima tely 32 1 ac res of the qua rry par cel is ac tiv ely used for quar ry oper ati ons. The main entrance to the quar ry is lo cated off Lake Herm an Road abou t 0.6 miles from its inter sec ti on with Colum bus Pa rkwa y.
Presen t land uses sur rounding the projec t site include the Blue Rock Spr ings Gol f Cour se and Blu e Rock Springs Par k to the nor th west . Two par ce ls used for man ufa cturing li e immedia tely west of the proje ct site . Each of the two parce ls contains a re sidenc e: one par cel is private ly owned and the oth er is own ed DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Indu stries, Inc.
U-08-09/RP-08-01 Staff Report
by Syar In dust ries . To the northeast is open spac e owned by the Sola no Land Trust . To the ea st, southeast and southwest lay undevelop ed rang ela nds owned by Syar Industries. Dir ectly to the south is an open sp ace parcel owned by the Ci ty of Valle jo. Two PG&E tran smi ss ion tower easeme nts trav erse the quarry si te in an east-west dir ecti on. They are lo cated nor th and south of the present quarr y operation. PG&E high pres sure gas lines cross south of the qua rry si te and alo ng with the PG&E high tensio n trans mi ssio n lines const rain qua rry expans ion tathe south . A small AT&T relay sta tion si te, less tha n one acr e in si ze, is lo cated at the Sul phur Sp ri ngs Mountai n sum mi t south of the area prop osed for mini ng expan sio n. The nearest resi dential deve lop ment is lo cated to the west and southwest and is fro m one thir d to on e hal f mil e away and beh ind an intervening ridg elin e. Res idential areas of the citi es of Val lejo and Benicia li e farther to the west and so uth , respective ly.
VI. Current Existing Operations
As stated ab ove, the Lak e Herm an Qua rry Project site is ap pro xim ately 468 acres; 32 1 acr es which are actively used for the Quarr y operations. Ther e are a va riety of on-s ite op erations which take plac e on appr oxima tely 72 acr es of the 321 acr es .
On-site Facilities
Incl uded in the on-s ite facil ities are the adm inistr ation offic es, a materi als testing labor atory, equipm ent mai ntenance and service bui ldi ng s, ma terial and equipme nt storage yar ds, an aggr eg ate processi ng area, two asph al ti c concrete pla nts , a ready -mix concr ete batch pl ant, a recycling plan t, a sca le house and other rela ted faci lities . These facili ties operate on ap proxi mately 72 ac res of the 321 ac re existi ng si te.
Aggregate Processing Area: The processi ng area cons ists of a primar y crus her, sc reens , gr izzly, convey or belts , mul ti ple aggr eg ate stockpi les and an aggr eg ate wash facili ty. In addi tio n, this area has a whe el wash area, adm ini stra tio n offi ce, scales, scale house and fuel isla nd. This area encom pass es appr oxi mately 34. 9 acres and requir es appr oxi ma tely five to six empl oyees to ope rate the ag greg ate proc ess ing area and the aggr egate wash faci lity, with an add itional five to six emplo yees in the mai n offi ce and scal e ho use. .
Aspha ltic Concrete Plants: The two asphal t pl ants consis t of a revo lving drum, a bag hous e (enclos ed vacuum system), oil storage area, a pub mill and silos. The two pla nts encompass approxi ma tely 2.8 acres and requir e appr oxi ma tely th ree employ ees to op erate each of the pla nts .
Rea dy-Mix Concr ete Batch Plant: The batch pl ant consi sts of a revolving drum, si los and raw ag greg ate sto rage areas. This area enco mpa sses ap prox im ately 6.8 acres and requir es appr oximat ely five employ ees to oper ate .
Recycling Plant: The recycling pl ant cons ists of a convey or, crus her, screens , recycled asphal t and concr ete stockp iles. This area enco mp ass es appr oxi mately 8.6 acres and requi res a mi nimu m of th ree empl oye es to operate.
Scalper Plant: The scalp er area consis ts of conv eyo rs and screens, enc om pass es 5.6 acr es and requir es two to th ree empl oyees to operate.
Other Areas: Oth er areas associ ated with the qua rry op era tions includ e: equip ment and material sto rage areas (2 .3 acr es); ma teri al testing labor ator y (.9 acres) with appr oxim ately five to six emplo yees; ma intenance and servic e buil ding (3.4 ) ac res with appr oxima tely ni ne empl oyees and the process and sed im ent control water ponds (6.4 acres) .
An extens ive series of haul roads and sto rm water drainage facil ities are loca ted thr oug h out the quarr y.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Sya r Industries, Inc.
U-08-0 9/RP-08-01 Staff Report
Existing Conditions
D Project Site (468 acres)
o Processing Areas - Approximate Footprints
c::J Quany Pit as of Nov. 2009 (113 acres)
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Solano Coun�1
Luke HemlCn Quarry EIR
Job /loml»r 11174109001
Rl?/isa:n A
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Existing Conditions Figure 2-2
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DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
Uti lities
The project is conn ected to Ci ty of Valle jo water thoug h the qua rry does not uti li ze the conn ecti on. Non potable wate r comes from an agricu ltura l well, the sedi men t po nds on-site, the qua rry pit rete ntion pon d and a la ke on the adja cent gol f course proper ty (th roug h an ag reement with the Ci ty of Va lle jo) . Drinki ng water is sup pli ed by bottle d water.
The operation util izes a sep tic system and por ta bl e restrooms. The main tenanc e shop at the nor th en d of the par cel is the only buil ding with perma nen t plumb ing fixtu res. The plum bing fixtu res dischar ge to a hol ding tank which requir es routi ne main tenanc e/rem oval of the waste accu mu lation in the tank. The tank is pum ped twice per year. Ther e ar e seve n por ta ble to ilets in use thr oug hout the property to aug men t the use of the perm anen t toil et faci li tie s. The por table toile ts are servic ed by Un ited Si te Ser vic es.
Ther e are con nec tions to PG&E for na tural ga s and elec tricit y. The quar ry par ticipa tes in PG&E progr ams to reduce ener gy during peak hour s, which in clu des the Ba se In te rru pti ble Pr ogram an d .the Deman d Building Prog ram.
Hazardous Materials
Ther e are a number of pote nti ally ha za rdous ma terials and waste sto red at the pr oje ct si te . Som e of these ma terials inclu de qua ntities of mo tor oil, ma chine lubr ica nts , and so lvent. The ha za rdous materials are sto red at var io us lo cati ons thr ou ghou t the si te incl uding the fuel islan d, scalper plant, hot plan t main tenanc e shop, dr um plan t con crete plant an d AC plant. Per the Envi ronmen tal Health Divi sion of the Depar tmen t of Resource Managemen t, a "S oil Preve nti on Co ntrol an d Cou nte rmeas ure Plan " has been appr oved for the existing project. This plan describes the safety procedur es foll owed by the appl icant as we ll as the pro cedur e for res ponse and no tifi cati on in case a spill occu rs. A Haza rdous Mate rials Busi ness Plan whic h co ntai ns a comp lete in vento ry of ha zardous materials is also on fi le with the Envir onmen tal Health Di vis ion .
The explosi ves tha t are use d as part of the rock remo val process co nsis ts of ammoniu m nitrate fuel oil (ANFO) . The ANFO is not sto red on -s ite but is transpo rted to the projec t si te via a Department of Transpo rtation app roved an d placar ded truck by an explos ives deale r prior to a blasti ng eve nt.
Hour s of Operation
Cu rre nt hours of op erati on are base d on demand. The reg ular hour s of oper ation are Mon day th ru Friday fro m 7:00 am to 10 :00 pm an d Sa tur day fro m 7:00 am to 4:3 0 pm (sales only ), with red uc ed hour s during the winter. Aggrega te proces sing in term ittently occurs up to 7 days a week 24 hour s a day during emer genc y and high dema nd situa tions. Work on transpor tation in frastruc tur e projec ts for Ca ltr ans and oth er go vern me nt agenc ies often takes pl ace at nig ht, to avoi d the traffic imp acts tha t wo uld resul t fro m day ti me construc ti on. According to Syar In dus tries, their ener gy sa vi ng contrac ts with PG&E req ui res them to process dur in g off-peak hour s due to the high ener gy dem and for PG& E in hot summer mo nths .
Weeken d hour s are some times nec essar y to main tain projec t sche dules par ti cular ly in the fa ll when ra in y season is ap proach ing. In additi on , lar ge scale di sas ters, such as wide spr ead flooding , ear th quak es or lan dsli des may create shor t-term extra ordinar y mar ket deman d for agg regate products which can only be satis fied by exte nded oper ational hours.
Extraction and Sa les Qua ntiti es
Per the applica nt, sales fro m 2004 to 2008 were between 2.0 an d 3.4 million tons of ma ter ial per yea r wh ic h average d to 2.9 7 million tons of ma terial (incl udes agg reg ate, asphal t, overbur den and recycl ed products ). Appr oximate ly 75 % of gr oss extraction ma terials produce construc tion gr ade agg reg ate with the re mai nin g 25% consi sting of waste ma terials (ov er bur den) wh ic h is ei ther stored on the project si te or sol d as fi ll mater ial for projects.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09 /RP- 08-0 1 Staff Report
Min ing Method
Agg reg ate ma te rials are extra cted prima rily by mec hanical excavat ion equ ipmen t. Prior to mi ning within an und isturbed area, top soil is str i pped to an aver age dep th of 18 inc hes and stockp iled on the si te for futu re use duri ng reclama tion. Over bur den en countered dur ing min ing is also remo ved in order to reach the min eral depo si t belo w. The over bur den is sold as fill, stored in the qua rry pit, or sto ckpiled on the si te to be used fo r fi nal slop e co nfigur ation du ri ng recl ama tion activiti es. Next, a rock dr ill is brou g ht to the work area and a ma trix of hole s is dril led. A blas ting cap is pla ced in each hole, explosi ves are pl aced ab ove the blas ting cap, and the up per por tion of each hole is capped with gr anular ma ter ial. The explos ives are contr oll ed elec tronic ally or thr ough a time fusing system so that the char ge in each hole is detona ted milli seconds apart fro m tha t in other holes in the ma trix. The ener gy of the bl ast is di rected in to the rock ca usin g it to fracture . Onc e the rock has been fractured, it can be har vested using mech an ical excava to rs. As work progr esses, the wor king terrace is lower ed , and 25 -foot wide benches are cut in to the slope at 50- foot in tervals to create a stable slo pe , in tercept falling rock, and to pr ovide contr olled slope drai na ge. The extrac tion conti nue s ou tward from the up per most bench and do wnwa rd until a prescr ibed de pth is reac hed. Overall slop e ratios average 0.5:1 grad ient, wh ile the slope s betwe en benches are near ly vertic al. A water truck is used to wet work areas and haul ro ads for dust contr ol.
Fractured rock is co ll ected by load ers and loade d in to large-ca paci ty, off-ro ad haul trucks or co nveyor s and transpor ted to the main crusher at the rock plan t, exce pt for some mate rial wh ich is taken dir ectly by the loader to a scalper wh ere ove rsized rocks are di verted to a tempor ary stockpile . After the rock is crus hed , it is scr eene d by si ze and co nveyed to sto rage piles. Some of the proce ssed rock is als o sto ckpile d at the asphal t paving ma ter ials an d ready-mix con crete batch plan ts where it is fed in to respec tive pl ants accor ding to the desir ed mi x.
On-S ite Proces sing
On -site proce ssing activities in clude aggr eg ate process ing , recycled mate rial proces sing (incl udes crus hing and ble nd ing with other ma ter ials to mak e recycl ed asphal t, aggr ega te or co ncrete produc ts) , and the ma nu facture of asphal t paving ma ter ials and ready -m ix con cret e. Raw ma terials are sto ckp iled adjacent to each process ing uni t.
Roc k process ing typically beg ins with the freshly excavated rock being br oug ht to a pr imar y crusher.
Lar ge si zed rock, us ually larger than si x inches , is separ ated for uses such as rip-rap (for ar mor shor elines, bridge abu tme nts , etc.) or gab ion rock (rocks used to fi ll cag es , box es, cyl ind ers for road build ing , etc.). The rem aining rock is transpor ted to the primar y jaw crus her and secondar y cone crusher where it is crushe d. After crus hing, the rock is conveyed to a series of screens wher e it is se pa rated by si ze and then co nveyed to separ ate stockpiles accor d in g to si ze sp ecifi cations. A wate r spr ay sy ste m with jets at trans fe r uni ts on the conv eyor syste ms is used to suppr ess dust dur ing rock proces sing activi ties . Some of the rock, depen ding on the sp ec ifi cation needed, is washed . in a sa tld screw to rem ove fi ne se dim en ts. The fi ne sedi men ts are conveyed in a water slur ry to settl ing pon ds loc ated at the north west edge of the qua rry si te . Recy cle proce ssing is sim ilar to rock proc ess ing , exce pt tha t all ma ter ials are crushed and scr eene d using a separate pl ant.
Two aspha ltic con crete man ufa ctur ing plan ts and a Por tland cemen t concr ete batch plan t are loc ated at the Lake Herman Qua rry. Rock from the mining oper ati on is the primar y co mp onen t in the final, ma nufactured products from these plan ts and is sto ckp iled at each plan t. Other compo nents of the pro ducts are im port ed in to the si te by truck, inc lud ing asphal t oil, Portland cemen t, sand, and vari ous oth er ma ter ials and add itiv es.
Asphalt pavi ng ma ter ials ar e manu factu red by mi xing rock, sand and fine sedimen ts tog eth er with asphal t oil which is trucked to the site and stored in ta nks at the plan t. The rock and sand are first DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
heated in a revo lvi ng drum to driv e out moi sture and then the asphalt oil is added. Dust is remo ved during the drying pr ocess and is trapp ed in an enclo sed vac uum system kn own as a bag house. The trapp ed dust is then pi ped into a wate r sl urry fro m the bag house to settl ing ponds lo cated at the north west edge of the qua rry si te. The ho t pavi ng ma teri al is conveyed fro m the pug -m ill or dru m to either a truck or a silo and then lo aded fro m the silo into customer trucks .
Ready -mi x concr ete is manufactured by mi xing rock and sand together with Por tl and cement an d water.
Sand an d Por tl and cement and some rock are trucked to the sit e and stor ed in silos. The rock, sand, and cement are loa ded fro m the pl ant in to ready-m ix concr ete trucks wh ich are fitted with a revolvi ng drum. Water and additiv es are then added accor di ng to mi x spe cifica ti ons .
Lighti ng
Duri ng the summ er mon ths, processi ng and extraction may oc cur at nig ht. Occas io nally process ing is done at nigh t in the winte r months during emer gency sit uati ons. There are appr oxim ately 38 outdoor lig hting fixtu res th roug hout the qua rry. Lighting at the dri vewa y, ready mi x area an d fuel isla nd are ph oto cell activa ted . The yard pla nt li ghts are man ua lly oper ated and are turned on by the oper ato r on as as neede d basis. A major ity of the ligh t fixtures are dir ectional, meani ng they direct li gh t towa rds the gr ound and not skywa rd . The quarr y also has por tabl e lig ht pla nts that are used th roug hout the processin g area on as-needed basi s. When port abl e lig hts are used during extraction they are dir ected toward the rock face.
Stormw ater Runo ff and Wate r Qual ity
Sto rmwate r disch arges fro m industri al si tes are regulated by the Federal Cl ean Wate r Act by the Cali forn ia State Water Resources Contr ol Boar d th roug h a General Industri al Storm Water Pe rm it. A No tice of In tent was fi led for the Lak e Herman Qua rry in order to obtain author izat ion for storm water discharges.
There is an exis ting Lake Herm an Quarry Stor m Water Pol lutio n Prevention Plan (SW PPP). The pla n was deve lop ed to desc ri be the sit es' sto rmwat er drai nage system an d the potential poll utants in stormwat er. The plan outl ines Best man agement Prac tices used to contro l stormw ate r pol luta nts and to est ablish a moni tori ng pla n. The SWP PP addresses specific actio ns and activities at the site to mi nimi ze sto rmwat er pol lutants from ente ring the storm water drainage system at the si te and from being dischar ged to Bl ue Rock Sp rings Creek to the nor thwest and Sul phur Sp ri ngs Creek to the so utheast.
This Plan is reviewed and updat ed ann ually as needed by Syar .
Street Sweep ing
A road swee per is used several ti mes per day to clea n up spill an d loos e ma terials track ed on Lak e Herm an road. Spill prevention measur es inc lude le aving freeboar d on trucks and covering certain loa ds.
VII. Lake Herman Quarry Proposed Expansion Project
In Apri l 2008 , Syar In dustries subm itted a use perm it applic atio n to exp and the qua rry operati on an d to extend the op erati ons beyond the 20 14 perm it expi rati on. Beca use ther e were mul tipl e use perm its associ ated with all the opera ti ons at the si te, staff combi ned all the exis ting use per mits with the new expansio n project so tha t ther e is now a new all- inclusiv e use permit. This is intended to al lev ia te any confusi on in the future with the ol der perm it num bers and appr ovals for both staff an d Syar.
It sho uld be noted tha t sinc e the applic atio n was orig inall y subm itted in 2008, the project descrip ti on has si nce been sca led back by Syar In dust ries. The propos ed expan sio n project is descri bed belo w:
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
Proposed Project
Project Site (468 acres)
Quany Pit as of Nov. 2009 (113 acres)
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DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
Project Description
The appl ic ant has applied for a 35- year use permit (U-08-09) to:
1. Continu e to al low surface mi ning and reclam ation activities for aggr eg ate process ing , aggr eg ate produ ct manufacturing and sales of 3.0 mill ion tons per year at the existi ng Lak e Herm an Qua rry for an additional 35 year s comme nci ng at the time if iss ua nce of the Use Perm it and ap pro val of a new Mi ning and Reclam atio n Pl an.
2. Expand the ac tive qua rry pit fro m 11 3 acres to 21 1 acr es.
3. Incr ease the dep th of the existi ng qua rry pit by 200 feet from 200 feet abo ve mea n sea le vel (msl) to 0 msl; and
4. Ch ange the al lowable ho urs of op erati on.
Proposed On-s ite Facilities
The types of on-s ite faci li ties would rema in the same as ide ntified and de scri bed abo ve in Current Oper ations por tion of the staff repor t. The num ber of emplo yees would remai n the same . The existing facili ti es, includ ing the agg rega te processing equipme nt would not be expa nded. However, some existing faci liti es would be modi fied with new equipme nt or tech no logy to meet mar ket demand . The exis ti ng equi pme nt tha t would be mo di fied incl udes :
1. Oper ati on of recyc led asphalt pav eme nt (RAP) handli ng equi pm ent at the asphalt conc rete ba tch plan t. In stalla tion and oper ati on of RAP handl ing equipme nt at the asph alt concreted drum mi x pl ant. The RAP equipme nt includ es dual hopp ers, transfer conve yor belt, scr een conveyor belt, vi brating sc reen , feed co nvey or belt, holdi ng hopper, and pug mill feed conve yor. This equ ipm ent wou ld allo w for a certai n per centage of vir gi n ag grega te current ly used in the asphal t mi x to be replac ed with recycle ma ter. The recycled asphal t fro m existing onsite sto ckpiles would be used to make this product.
2. The existing 80-ton silo would be replac ed with two 12 0-ton silos.
3. A thr ee-bi n aggr eg ate mi xing sys tem would be added to the agg regate proce ssi ng faci li ti es.
Over tim e, as exis ting equi pme nt ages , it wou ld be replac ed with newe r equi pme nt and ne w tec hnologies.
Sto rag e of ove rbu rden would conti nue as de scribed in Cu rrent Op erations abo ve. Al l exis ting haul roads on the si te would conti nue to be used and mai ntaine d.
Proposed Hour s of Operation
The regular ho urs of oper atio n are Monday thr oug h Frida y fro m 7:00 am to 10 :00 pm and Saturday fro m 7: 00 am to 4:30 pm (sales only) , with ho urs reduced during the winter mo nths. Aggr eg ate processi ng oc curs outside the regular hours of oper ation appr oximately 60 days per year during emer gency or high dema nd si tuation and asphalt pla nt ope ratio ns occur outs ide the regular hours of oper ation appr oxi ma tely 90 day s per year . Projec ts for Ca ltra ns and other go vernme nt age ncies often oc cur at nig ht to avoid traffic im pacts that may be caus ed du ring day ligh t hours .
The pr oposed cha nges to the hours of oper ation are as foll ows:
Reg ular Agg regate Processi ng Oper atio n Hour s
Construc tio n Seaso n - Monday thr u Satur day, 6:00 am to 10 :30 pm DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
Off Seas on - Monda y thru Frida y, 6:00 am to 10 :30 pm Regu lar Aggr egate Mining Opera tion Hours
Con struction Season - Monday thr u Sa turday, 6:0 0 am to 10 :30 pm Off Season - Monda y thr u Friday, 6:00 am to 2:30 pm
Con structi on season is gener ally fro m April - October and off-season is gener ally consider ed Novemb er thr u Mar ch . Aggreg ate proces sing and sa les would co nti nue to operate outside the regul ar ho urs of operati on ap pro xim ately 60 da ys per year , and the asphal t plan t op erations ap proxim ately 90 da ys per year, depe ndin g on ma rket condi ti ons and customer requir eme nts.
Extraction an d Sale s Quant ities
Ther e would be no incr ease in the average ann ual sal es which would remain the same as the existi ng · co ndi ti on at 3.0 mi llion tons per year . The 3. 0 mi llion tons would in clude rock products as well as asphal t paving materia ls, ready -m ix concr ete, overburden for fill ma teri al and recycled asphal t and conc rete.
Min ing Method
There are no cha nges propos ed to the mining methods that are descri bed in the Current Operations section abov e. However, the ma xi mum min ing depth would cha nge fro m 200 feet ab ove msl level to 0 feet abo ve msl . A 75' wide ac cess road would be esta blis hed at 450 feet above msl to provide primar y access to the peri meter of the extraction area. The access road would be con structed such tha t stormwater orig in ati ng fro m the road su rface wou ld be conv eyed to an inboar d drainage di tch tha t would be par all el to the roadway. The dr ai nage di tch wou ld collect runoff and conv ey it in to the expandi ng quar ry pit. The ro ad loc ation would cha nge as the qua rry pit expa nds, and the proper grad ing would need to be mai ntain ed to eli mi na te the potenti al of sto rmwater being conv eyed off-site. Other temporar y access roads at var ious el evations and ra mps between benches would be esta bli shed and removed as needed as par t of the ong oing min e operat ions .
On-s ite Processing
In gener al, on -site processing activ ities wi ll rema in the sam e as th ose descri bed in the Current Operati ons secti on abo ve . Tho ug h , as the quarry pit exp ands over time, mobile equipment could tak e di fferent routes between the qua rry pit and the proces sing area. Als o, the loc ation of the pr ocessin g equ ipmen t could shi ft within the bo un dar ies of the quarry expansion area.
Lighting
Lig hting wou ld rema in the same as des cri bed under Current Operati ons. No new lig hting source is bei ng prop osed . Ni gh t time lig hting may remain on for lo nger peri ods of time to acc ommo date nig ht-time ho urs of op erati on.
Stormwate r Runo ff and Water Qua lity
Sto rmwater runoff and water qual ity wou ld be man aged in the sa me mann er as the existi ng operat ions .
There wi ll co ntinue to be yearly reviews and upd ates to the Haza rdo us Ma terials Bus in ess Plan and the In dustria l Stor m Water Poll ution Prevention Pla n.
Street Sweepi ng
No chang es are being proposed. Street sweeping wou ld conti nue in the sam e mann er as descr ibed under Cur rent Oper ations.
Bridge Repl acem ent
There is a di lapid ated br idge across Sulp hur Sp ri ngs Creek tha t exists to the so utheas t of the project site off Sk y Val ley Road. The bridge is abo ut 80' long and consis ts of a wood plank deck , steel jois ts and DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
steel and wood suppo rts . The bridge wi ll be replac ed as part of this project in order to allo w for an emer genc y access to the back si de (nor theas t) of the qua rry in event of a wil dfi re. So me of the br idge suppor ts would remain and 14 new 24-inc h reinforced concr ete pier s wou ld be added. The new piers would be loca ted ab ove the Ordi nar y High Water (O HW) ma rk. Four additi onal abutments wo ul d be con structed , which also would be lo cated ab ove the OHW. The woo d deck, which is attac hed to metal piping Uois ts) wo ul d be remo ved and repl aced with two ra ilr oad flat car s welded together. The existi ng pilin gs would remain in pl ace. Rock slop e protection is propos ed on bo th si des of the creek bank for appr oxim ate ly 2, 10 0 squar e feet of which a por tion woul d be below the OHW mar k. Cons truc tion of the replac ement bridge would oc cur during the sum mer after the permit is is sued and would la st appr oxi mately ni ne week s. (D EIR Figur e 2.4 - Sul phur Creek Bridge Replacem ent Concep tual Pla n for addi tional details )
Off-S ite Improve me nts
Im provements to Lak e Herm an Road are being propos ed as par t of the new use perm it. Imp rovem ents wo ul d occ ur alon g an appr oxima tely 2,2 80-fo ot seg ment fro m the Solano CountyNal lejo Ci ty limi t line to several hundred feet east of the Lak e Herm an Qua rry Entr anc e in accor danc e with plans prepared by Solano County in associa ti on with Syar in 2003 and revised plans in 20 14 . Im provements inc lude enhancin g the pavement structural sectio n (except no concr ete rein forcement structure cross in g Lak e Herman Roa d at the qua rry entra nce) , lane widen ing, additi on of paved shoul der s, addition of a left turn lane in to the qua rry en trance for ea stbo und truck traffic, a mer ge lane for westbound tru cks leavi ng the qua rry, and a transition section on the eas t si de of the qu arry entr ance. Much of the in creased paving that would result fro m the impr ove ments woul d oc cur on the southwest side of Lake Herm an Roa d and would in creas e by as much as 22 feet. Imp rove ments on the no rtheast side would be lim ited to the entr anc e and appro ach to the en trance. The existi ng roa d va ries in width fro m 23 to 47 feet. After installa tion of the impr ovements , the width would var y between ab out 39 and 69 feet. These impr oveme nts wou ld be co mp leted within th ree year s after iss ua nce of the Use Perm it. Co nst ruction is expected to tak e appr oxim ately si x mon ths.
VIII. DISCUSSION AND ANALYSIS
The Dep artm en t of Resou rce Man ageme nt staff has reviewed the pro jec t for cons istenc y with the Solano County Gener al Pla n, the Solano County Zo ning Reg ula tions, the Surface Mining an d Reclam atio n Act (S MARA) , and the Cali forn ia Envir onmental Qual ity Act (CEQ A) .
Gener al Plan & Zoni ng Cons istenc y
General Pla n - The property is design ated Ag riculture with a Res ource Cons ervati on Ove rlay by the Solano County Ge neral Pla n. An Agri culture land use desig na tion provi des areas for the prac tic e of agric ulture as the primar y use, in clu ding ar eas that contri bute signi fica ntly to the local ag ricu ltural economy and al lows for seconda ry uses tha t suppo rt the eco nomic via bili ty of ag ric ultu re. A Resou rce Co nversation Overla y ident ifies and protects areas of the Co unty with special resou rce ma nagem ent needs . The Cali fornia Surfac e Mini ng and Recl ama tion Act of 19 75 (S MARA) requir es tha t all juris dic tions in corpo rate mapp ed mi neral resources designations appr oved by the State Mini ng an d Geo logy Board within their Gener al Plans. The Lak e Herm an Qua rry area is deSig nated an MR Z-2 Mi neral Resou rce Zone, which is described as an area wher e adequat e informa tion in di cates tha t signi ficant miner al depos its are present, or where it is judged tha t a high lik elihood for their presenc e exists. The expansion and continu ed mi ning operation at the Lak e Herm an Qua rry si te, as propos ed, co mp lies with the Solano County Gen eral Plan .
Zo nin g -The pro perty is zot;led A-20, Excl usive Ag ricultural (20 acre minim um ), which all ows sur face mining with a Use Per mit, accor din g to Tabl e 28-21 A in Section 28.21 (Ag ricult ural Dis tri cts) an d Section DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
28.78. 20( A) Gener al Req uir emen ts fo r In frastru cture Us es of the Solano Cou nty Zoning Reg ula tio ns.
The applic ant has applied for a use permit to extend and expand the mi ning oper ation. As proposed , the project co mp lies with Solano Coun ty Zoning Reg ula tions.
Surf ace Min ing and Reclama tion Act (SMARA)
The Lake Her man Qua rry is par t of the Sulphu r Spr ings Moun tain mi neral resour ce tha t has been desig na ted by the State of Cali fornia as an Area of Reg ional Si gni fica nce, pur su ant to the State Sur face Mining and Rec lam ation Act (SMARA) of 19 75. Area of Regiona l Signi ficance means an area designa ted by the Sta te Mi ning an d Geo logy Bo ard , pur suant to publi c Reso ur ce Code sec tion 2790, which is kn own to co nta in a deposi t of mine ra ls, the extracti on of which is judged to be of prime imp orta nc e in meeting futu re needs for miner als in a par ticular reg ion of the state.
Recl amation as de fined in the Sta te Su rface Minin g and Rec la ma tion Act (SMARA) consis ts of a combin ation of land treatme nts in tended to minimi ze water degr adat ion , air polluti on, damage to aqua tic or wi ldlif e habi tat, and eros ion. SMARA states tha t the reclama tion process may inc lude back filling, grad ing, re-soi ling , revegetat ion, soil com pac tion and 'sta bili zat ion . Revegeta tion , an im portant part of mo st min ed-land reclamation pla ns, can provi de for erosion and sedimen t contr ol, du st contr ol, slop e stabil ity, aes the ti cs , cro p prod uction , or a combi nation of these pur poses .
Si nce ther e is an exis ting mining oper ation at the site , ther e is an existi ng, app roved Rec lama tion Plan for the proper ty. The app li cant has subm itted an Amended Rec la ma tion Plan to addr ess the expa nsi on of the mining oper ati on. The Rec lama tion Plan was or ig ina lly subm itted and revie wed by the State Div ision of Mines and Geo logy, Mined Lands Rec lama tion Pr ogr am. The com ple te Mining and Rec lama tion Plan was di stri bute d in ea rl ier corresponde nc e to the Planning Commsion.
In summar y, recla ma tion of the qu arry site wi ll be done in phases so tha t portions of the proper ty will be un dergoing reclamation as mining oper ati ons mo ve to oth er areas of the qua rry. Fina l rec;;lama tion will take place at the end of the 35-:-year permi t and will include remo ving all Of the eq uipmen t on the sit e, gr ading any rem aini ng ag greg ate stockpi les, fill ing in sedi men t ponds, dewater ing the pit area, in stalli ng necessar y dr aina ge syste ms, and seeding gr aded ar eas to co ntrol eros ion. Sl opes on the quar ry wil l be benched, resoiled and reve ge tat ed. The fina l use of the area will be open spa ce. The Rec lama tion Plan includes a reveg eta tion mon itoring progr am for five . year s after final reclama tion to en sur e tha t weeds are cont rolled and tha t plant ma teri als are gr owi ng suc ces sfully. .
In cluded in the Recla ma ti on Plan as Appendi x C is the Financ ial Assur anc e Co st Esti mat� (FAC E) .
SMARA req uir es ·s urface min e oper ator s to ob tain Cou nty appr oval of financial ass urances to ensur e tha t if the operator abandons the mine prior to reclama tion; the Coun ty wi ll ha ve the necessar y fu nds to reclaim the mi ned lands. Finan cia l Ass uranc e Cos t Esti ma tes are subm itte d ann ually by the oper ator for revie w an d appr oval by the Cou nty. The 2014 FAC E is cu rre ntly under review and wi ll be appr oved by staff at a later date . A condition of appr ova l addr essin g the upda ted FAC E is inc lu ded in the condi tion of appr oval for the pr oject. Un til then, the cu rre nt sur ety bond of $1,4 09,563. 17 will remai n in effect.
The proposed Rec lama tion Plan, as co ndi ti one d in this staff repor t, is cons iste nt with SM ARA and Chap ter 29 of the So lano Cou nty Co de.
OTHER REVI EW AN D COMME NTS
The ap plic ati on for expan sion was sent to State and local agenc ies fo r review and co mm en t. No co mm en ts we re re ce ived .
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
The applic ation was reviewed by other Divis ions with the Departmen t of Resour ce Man agemen t and th eir co mmen ts are as foll ows:
The Envir onmen tal Heal th Ser vic es Div ision revi ewed the applic ati on and recommen ded cond itions of appr oval to the use permit which req uir e annual slop e sta bil ity ins pections of stoc kpiles and fi ni she d slop es to prevent adver se geologic al co ndi ti ons. Al so, conditions of appr oval addr ess in g the req uir emen ts of a Hazardous Ma ter ials Busi ness Plan and co mp lian ce with the State of Cali fo rnia Depar tmen t of Public Heal th, Division of Drinking Wate r.
The Public Works Engi neering Di vis ion revie wed the applic ati on and rec ommen ded condit ions of ap prova l relating to road impr ove men ts req uir ed along Lake Her man Road near the qu arry en trance.
Road impr oveme nts were a req uir emen t of the previous use perm it appr oved in 20 01 . Per the 2001 permit, the road impr ove men ts we re to be tri gger ed when Syar Ind ustri es began using the pro per ty to the so uth of Lake Herman Road for storag e of ove rbu rden . With the current appl icati on, this pa rce l wi ll no longer be used for overbur den sto rag e. Discussions were held betwe en Syar In dustri es and Pub lic Works Engine ering as to what type of road impr oveme nts would be requir ed with this cu rrent application for expansion and extension. The previ ously appr oved road impr ovement plans have been redesigned to avoid exist ing util iti es. The plans ha ve been agr eed to by both Sya r In dus tries and the Cou nty and condi tions of ap prova l are included belo w to refl ect the redesi g ned road impr ove me nts .
The Build ing Div ision reviewed the applic ati on and has co ndi tioned the perm it to req uir e a buil ding perm it for the ins ta lla tion of any ne w struc tures.
IX. ENVIRONMENTAL IMPACT REPORT/DETERMINATION
The Cou nty of Solano, as Lead Ag en cy, thr ough its co nsul tant GHD , In c. prepared a Draft EIR (DEI R) for the pr oposed Projec t. The EIR exami nes all of the potenti ally signi ficant envi ronmen tal effe cts of the project, and al tern ative and /or mi tiga tion me asur es to reduc e or avoid those signi ficant im pac ts . The pu rpose of an EIR is no t to rec om mend either appr ova l or denial of a project, but to di sclose objective in form ation so tha t in formed decisions can be made .
The Draft EIR was publ ished for a 45-d ay public revie w and comm ent period that beg an on Ju ly 19 , 201 3 and closed on Sep temb er 4, 20 13 . A No tice of Compl etion was filed on July 19 , 20 13 with the State Clear ing house, which then cir cu la ted the doc umen t to res ponsible and in te rested agencies. Add itional copies we re dis tribu ted to selec ted age ncies , organi zations and indi viduals who had earlier reques ted a copy. A Final EIR (FEI R) was prepared and di stri bu ted to the Planning Comm iss ion and com men ting agenc ies on No ve mb er 14 , 20 14 , in advance of the minimum req uir ed 10 -day s prior to the schedu led certific ati on da te on Dec emb er 4, 20 14 . The FEIR in co rpo rates the DEIR by reference and in clu des the com men t letters rece ived dur ing the public review of the DEI R and responses to those com men ts, as well as addit ional refe rences used in prepar ation of the FEI R. The Planning Comm ission mu st certif y the EIR as a com plete, accu rate , and objec tive analysis pr ior to taki ng action on the proposed use per mit.
Potenti al envir onme ntal im pac ts are classi fied in to one of thr ee major categor ie s: sig ni ficant imp acts tha t would remain sig ni ficant even with mi tiga tion ; si gni ficant im pac ts that co uld be mi tig ated to a le vel of less than sig ni fica nt; and less than signi ficant imp acts tha t wo uld req uir e no mi ti ga tion. A co mple te di scus sion of each im pac t and associ ated mi tig ation is pr ovided in the appr opr iate Chap ter s of the DEI R and as supplemen ted in the FE IR . The final mi tiga tion measur es are co nta in ed in Exhibit C (M iti ga tion and Moni tori ng Pla n).
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
Potenti al envir onmen tal im pac ts and mi tig ati on measur es , when nec ess ary, for the Syar projec t are summ arized in Table 1- 2 of Chap ter 1 (I ntr oduc tion and Summar y) of the DEI R. For each sig nificant im pa ct, the table inc lu des a summar y of the mi tig ati on mea sur e( s) and the level of signi ficance bef ore and after mi tiga tion. A bri ef summar y of the Table 1- 2 is provided belo w. As stated above, a com plete discussion of each imp act and assoc ia ted mi tiga tion is pr ovided in the ap propri ate Chap ters of the DEIR, and as supplemen ted in the FEI R. For the Syar projec t, the EIR concl udes as foll ows:
Significant Impacts after Mitigati on
Ther e were no areas of sig ni ficant impac t after mi tig ati on or areas wher e mit iga tion was not availab le.
Significa nt Impacts tha t coul d be Mitig ated to a Less- Than -Significant Leve l Signi ficant and pote ntiall y signi ficant impac ts tha t could be mi tig ated to a le ss-than- signi fica nt le ve l wo uld occur in the ar eas of Air Quali ty (AQ-2 ), Biology (BI0 -1 -3,- 5) , Cu ltur al Resou rces (CR-1 -3) , Ge ology and Soils (G EO -2-5) , Gre enhouse Ga ses and Ener gy Use (CG- 2), Hydrology and Wate r Quali ty (H WQ-1 , 4- 5) , Transp ortati on (TR-4- 5).
Less than Si gnifica nt Impac ts
Less than sig ni fican t imp acts that would not req uir e mi tiga tion are iden tified for Aesth eti cs , Ai r Qual ity, Biology, Geolo gy and Soils, Green house Gases and Ener gy Use (GG -1 ), Hazar dous Ma teri als (H AZ-1 - 6) , Hydr ology and Wate r Quali ty (HWQ-2-3 ,- 6) , Lan d Use (LU-1), No ise (NO-1 -4) , Public Ser vi ces , Recr eat ion, and Util ities (PS-1 -2) , Transpor tation (TR -1 -2).
Cumula tive Impa cts
CEQ A requir es the ana lysis of the "cumula tive im pac ts" of a projec t when exi sting or pla nned pr ojects woul d prod uc e impac ts in a particular im pac t cate gory, an d wher e the project under review wo uld co ntribute to these imp acts . In the case of the Syar project, no cumula tive imp acts we re ide ntified.
Altern atives
Chap ter 5 of the DEIR ana lyzes al terna tives of the Pr ojec t. As men tion ed earlier in this re por t, the Project has been su bstan tially revised fro m the projec t that was de scri bed in the orig inal appli cati on . Ther e were thr ee pri mar y changes in the project: the nor th sec tion of the project area was found to contai n a numb er of sensi tiv e hab itats , suc h as habi tat for the Callip pe Si lverspot But terfly, and the applic an t req uested tha t the sensitive ar ea, ap proxi mate ly 82 acres , be excl uded fro m the mining area. Secondly, the elimina tion of the over burden si te across La ke Herman Road , and thirdly, the elimi na tion of the in crease in saleable aggr eg ate fro m 4.0 mi llion to ns to the exis ting 3.0 mi llion to ns.
These project change s el imina ted pote ntial biologic al resour ces, aesthetic s, air quali ty , hyd rol ogy, gr eenh ouse ga ses , and transpor tati on imp acts all of whic h ha ve been avo ided by the cu rre nt pr oposed proje ct.
Altern atives Evalua ted In cluded :
Alterna tive 1 - No Pr oject Altern ative (as requir ed by CE QA) Un der the No Project Alte rn ative , oper ation of the quar ry wo uld conti nue un til expir ation of the use permit and reclama tion wo ul d beg in. Ho weve r, the demand for aggr eg ate would remain the same. With out the quar ry, lo cal cons tru cti on pr ojects would nee d to fi nd an al tern ative sour ce of aggr eg ate produc t. The next clos est sour ce of supply wo uld be a qua rry in Napa or a qu ar ry in Contr a Co sta Coun ty. Ho weve r, the perm itted capa city of these two quar ries combined could no t acc om moda te dema nd th at is cur rently supp li ed by the Lake Her ma n Quar ry. Ther efo re, the No Project Altern ative wo uld in crease vehicle miles trav eled, which wo ul d res ult in mor e air poll ution and gr eenhouse gas emi ssions, and shi ft traffic im pac ts to oth er areas .
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries , Inc.
U- 08-0 9/R P-0 8-0 1 Staff Report
Altern ative 2 - Red uced Biolog ical Im pacts
This wo uld be the same Pr oject, except that biolo gical resou rces al ong the sou thern bor der of the projec t site would be avo ided . Mi ning and process ing would conti nue in the same manner and the pit wo uld be expanded as propos ed, ho weve r; a 30 0-foot exclusion bu ffer would be est abl ished alo ng the sou the rn border to avo id sens itive wetlands and grasslands. The Dr aft EIR co ncluded tha t Altern ative 2 was the Env ir on ment ally Sup erior Altern ative because it would ha ve fewe r im pac ts to bi olog ic al resou rces than the Project. Howeve r, none of Pr oject's im pac ts are com plete avo ide d under Altern ative 2, and the mi tig ation proposed for implemen tati on of the Project would also apply to Altern ative 2.
The Draft EIR ide nti fies the Project as the envir onmen tally preferred altern ative , as a means of satis fying the projec t objec tives as stated wh ile mini mizi ng pote nti al envir onm en tal im pac ts.
Commen ts Rece ived on the Draft EIR
A Notice of Comple tion was filed on July 19 , 201 3 with the State Clear ing house, which then ci rcula ted the document to re sponsible and in terested age nci es. No co mm en ts were received fro m any State agenc y in reg ards to the Draft EI R.
All the com men t le tters received are lo cated in the Final EI R along with a deta iled response to eac h comm ent. Be low is a brief summar y of some of the commen ts receiv ed :
The Ci ty of Benicia req uested a clar ifica tion on extrac ti on and hour s of oper ati on and also had qu esti ons reg arding vi sual im pac ts. The Ci ty of Valle jo had comm en ts reg arding Gree nho use Gas Emissions, need for Heal th Risk Assess men t and Transpor tation concerns. The Tri-C ity and Coun ty Cooper ative Planning Gr oup had que sti ons reg arding pos sible im pac ts to near by hiking trails. Commen t letters fro m mem ber s of the public inc lu ded conc erns abou t grou ndw ate r, air quali ty, dust, and noi se .
As found in the Final EI R, the em ission data was clar ifi ed as sho wn in Appendix A of the Final EI R.
Additio nal gr ound wate r studies we re conduc ted and concluded tha t ther e woul d be no im pac ts to gr ound wate r. As requ ested, addi tional noise da ta was inc luded as sho wn in Appe ndi x C. Mi tig ation measur es and condi tions of appr ova l addr ess hour s of oper ati on, noi se and street sweeping fo r du st co ntrol and hik ing trails.
Mitigation and Mon itoring Plan
A Mi tigation and Moni tori ng Plan has been pr ep ared for adop tion by the Planning Commi ssio n in complia nce with the req uir emen ts of Public Resour ces Code Sec tion 21081.6. A Mi tig atio n and Moni toring Plan is req uir ed in order to ensur e the implemen tati on of those mi tigation measur es rec omm ended in the EI R tha t are being imposed on the project by Solano Cou nty as Condi tio ns of Appr oval for the req uir ed per mits. An upda ted Mi tig ation and Mon itori ng Plan is provided as Exh ibi t C.
The Mi tiga tion Moni tori ng Plan referenc es the Catraio Ranch Mana gemen t Plan under the Mon ito ring/ Repor ting Acti on co lumn. Syar subm itted a copy of the plan to staff and has been working with U.S. Fish and Wild li fe Ser vic e and U. S. Army Cor ps of Engine ers on the plan. This plan es ta blishes a conser vation easemen t of 106 acr es on the Ca tra io Ranch proper ty which is own ed by Syar and cu rre ntly used for gr azi ng activiti es. The conser vation easem ent would set aside land in pe rpetuity to compen sate for the im pac ts to the Callip pe Silv ersp ot Bu tterfl y and the Cali fornia Red-Leg ged Frog.
X. CEQ A FI ND INGS
Findin gs pur suant to the Cal ifornia En vironmen ta l Qual ity Act in Supp or t of the Ad op ti on of the Lake Herman Qua rry Expa nsion can be found in Attachmen t 1 of Exh ibi t A.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Ind ustries, Inc.
U-08- 09/RP -08-0 1 Staff Report
XI . FIN DINGS FOR USE PER MIT APP ROVAL AN D RE CL AMA TI ON PL AN
APP ROVAL
Based on the di scussion ab ove , staff recomme nds tha t the Planning Comm iss ion ma ke the follo wing findings in reg ard to this project:
1. The est ablishm en t, maint enanc e or oper ati on of a use or building appl ied fo r ar e in conf or m ity to the Gen er al Plan fo r the Cou nty with re ga rd to traffi c cir cu lat ion, popu lat ion dens ities and di str ibu tio n, and oth er aspec ts of the Gener al Plan cons ider ed by the Zo ning Ad minis trato r or Pl anning Commission to be per ti ne nt.
As discussed under Gener al Plan and Zoning Consis te nc y in the Dis cus sion and Analysis sec ti on of the staff report, the est abli shme nt, main te nanc e and oper ation of the proposed projec t is consis tent with all pertinent goals, pol icies and progr ams of the Solano Coun ty Gen eral Plan .
2. Adeq uate uti lit ies, access roads, dr ainage and oth er nec essa ry fac ili ties ha ve been or ar e being pr ovided. Adequa te fac ilitie s wi ll be pr ovi ded.
The projec t si te is cu rrently ser ved by Lak e He rm an Road and Columbus Pa rkway.
Im prove men ts to Lake Her man Road and the quar ry entr anc e are condi ti oned as part of this projec t. Drai nage wi ll be acco mmod ated by the existi ng dr ai nage facili ties suc h as the ponds and basi ns. El ectri cal u,tili ties are cu rrently att he site . No change s are proposed to the exi st ing sep tic and restroom faci li ties and the ther e is an existi ng bot tled water progr am for Syar empl oyees .
3. The appl icant exh ib its pr oof tha t su ch use wi ll no t, under the cir cu mst an ces of the par ti cular case, con stitut e a nu isance or be de tri me ntal to the health, sa fety, p eace, mor als, comf ort or gener al welf ar e of per sons residing or worki ng in or pass ing thr ough the neigh borhood as such pr opo sed use, or be de tri me ntal or in jur ious to pr oper ty and impr ove me nt s in the neighborhood or to the gener al welf a re of the Cou nty; pr ovid ed tha t if any pr opo sed building or use is necessar y fo r the public health, sa fety or gener al welfar e, the fi nding shall be to that effe ct.
The applicant has sho wn evid ence to su pport mak ing this manda tor y finding. The project prese nts insigni ficant envi ronmen tal imp acts and the Reso urce Man agemen t Depar tment has recomme nded the adop tion of an Envir onm ental Im pac t Report (EIR ) for the projec t. The projec t has been de signed and condi tioned to reso lve conc erns iden tified du ri ng the prepar ati on of the EIR reg arding aesthetic s, agr icul tural res our ces, air quali ty, biolog ic al resour ces , cultural resour ces, geology and soils, gr eenhouse ga ses, ha zar dous ma te rials , hyd rology and wate r quali ty, land use, popula tion and housing , min eral resour ces , n oise, public ser vi ces , uti li ties and recrea tion and transpor tation.
4. The proposed Rec lama ti on Plan, as amended by the appl icant and pr opo sed cond iti ons of appr ova l is consis te nt with the req uir ement s of the Su rface Mi ning and Rec la ma ti on Act of 19 75 (SMAR A) and Ch ap te r 29 of the Solano Cou nty Code. The Re cla mat ion Plan pr ovides fo r the rec la mat ion of di sturbed land s, pr eve nt ion of adver se effects , and pr otecti on of the public he alth and sa fety.
5. A copy of the applic at ion, Recla ma tion Plan and oth er documen ts subm itted by the appl icant was sub m itted to the Offi ce of Mi ne Reclamat ion (OMR ) and the comme nts sub m itted ha ve been consider ed by the Cou nty in the rev iew of this projec t.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Syar Industries, Inc.
U-08-09/RP-08-01 Staff Report
6. The pr opo sed use is com pati ble with sur rou nding land uses and will no t conf lic t with the long term open sp ace land use potenti al of the pr oject si te.
7. The use will no t ha ve a nega tive effe ct on neighb oring prope rties or pose a th reat to he alt h or safety.
8. The pr oject is in conf or mance with the Solano Cou nty Gener al Pl an and pr ovides fo r retu rn ing the proposed mine ar ea to open sp ace.
9. A surety bond fo r $1 ,409,56 3.1 7 (as may be adj us ted cons ist e nt with the req uir eme nts of SM ARA) is necessar y to com ply with the fi nancial as sur ance re quir eme nts of SMA RA and to guar an tee comple tion of the Recl amation Plan.
XI I. CONCLUS ION
Based on the appl ica tion ma terials subm itted by the applic ant, the in form ati on cont ained in the EIR including the mi tig ation measur es inc or por ated int o the project as co ndi tions of appr ova l, the Reclama tion Plan , and as di scussed in this report, staff recommen ds tha t the Planning Com mis sion fi nd tha t the project is cons istent with the appl icable pr ovisions of the Gen eral Plan and Zoning Reg ula tions, and all other applicable plans, polic ies, ordinanc es and reg ula tions.
The Use Per mi t Findings, Rec lama tion Plan Findings, CE QA Findings, as atta ched to this staff report, desc ri be the potent ially signi ficant impac ts to a le ve l that is less than sign ificant, the means of mi tig ati ng such imp acts to a level less than signi ficant, as the reasons for recommendin g appr ova l of the projec t.
ATTACHMENT S:
EXH IB IT A Reso lu tion Certifying EIR ..................................... ............ ............. ............. .......... 19 . EXH IB IT B Resolution Appro ving U-08-09 and RP-08-0 1 ................. ............... ........... .......... 21 Attachment 1 - CE QA Findings ...... . ... . ....... . ...................... ..... ............... ..... . ........ 25 Attachment 2 - Cond itio ns of Approv al. . ................................. ................... .......... 31 EXH IB IT C Mitiga tion and Moni toring Plan . .. ........ . ................ . ..... . ......... .. ............. . .... . .... . ...... 47 The follo wing do cumen ts were previousl y di strib uted an d can also be found on the Cou nty Website at www.s ola noc oun ty.c om ; clic k on Departme nts , Resou rce Mana gement. Doc umen ts; Env iro nmen tal Imp act Reports & Ne gative Decla rations:
Final EI R
Draft EI R
Mining and Reclama tion Pl an RP-0 8-0 1
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
18719286.1
Exhibit F to Collaborative Use Easement
Quarry Expansion Area
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
18719286.1
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
County of )
On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
18719286.1
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
County of )
On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT G
Quarry Expansion Area
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454
EXHIBIT H
1. In accordance with paragraph 10 of the Site Preparation Agreement, City and Syar agree to the following:
a. The Quarry Operator will not blast on weekends except under emergency situations (as defined in Section 13 hereof). The Quarry Operator will give City 48-hour notice prior written notice of any emergency blasting events. The City may require cancellation of outdoor activities at the revised Blue Rock GC during the scheduled emergency blasting events.
b. The City may temporarily suspend special outdoor activities at the clubhouse during the scheduled Quarry weekday blasting events and emergency blasting events. This provision shall in no way cancel golf play. c. City shall require, consistent with SB 110 of 2011 (amending Section 1103.4 of the Civil Code), that future land purchasers or lessors, and business operators, within one mile of the Quarry receive a “Notice of Mining Operations” disclosing the presence and continued operation of the Lake Herman Quarry with its blasting consistent with the Quarry Permit and EIR.
d. Commercial land sales/leases, and residential sales/leases for all properties listed in Exhibit A of this Agreement shall include a deed restriction providing notice of Quarry Operations consistent with the Quarry Permit and the Easement identified in Exhibit F.
DocuSign Envelope ID: 350D47B3-4F04-4083-853A-325D20545454 Certificate Of Completion
Envelope Id: 350D47B34F044083853A325D20545454
Status: Completed
Subject: Please DocuSign: Syar_City_Blue Rock_ Settlement Agreement_FINAL.pdf Source Envelope:
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Deena York
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Exhibit C-1 | Page 1
Exhibit C-1 Legal Description – Residential West Parcel
Exhibit C-1 | Page 2
Exhibit C-1 | Page 3
Exhibit C-1 | Page 4
Exhibit C-2 | Page 1
Exhibit C-2 Legal Description – Commercial North Parcel
Exhibit C-2 | Page 2
Exhibit C-2 | Page 3
Exhibit C-2 | Page 4
Exhibit C-3 | Page 1
Exhibit C-3 Legal Description – Commercial South Parcel
Exhibit C-3 | Page 2
Exhibit C-3 | Page 3
Exhibit C-3 | Page 4
Exhibit D Purchase and Sale Agreement and Joint Escrow Instructions Exhibit D Due Diligence Materials 1. Agreements. Copies of all existing easements, covenants, restrictions, agreements, warranties, and other documents, if any, which affect or relate to the Subject Property that are not disclosed by the Preliminary Title Report, including without limitation all agreements for the purchase of the Subject Property or an interest therein or an option with respect thereto entered into within the last three (3) years and documentation evidencing the termination or cancellation of the effectiveness of such agreements (which documents may be redacted to prevent disclosure of the purchase/option price). 2. Leases. Copies of all existing commercial or residential leases or rental agreements regarding any portion of the Subject Property, any guarantees thereof, and all amendments thereto (“Leases”), together with all court filings and/or correspondence regarding any past or ongoing litigation or disputes with tenants. 3. Service Contracts. Copies of all service, maintenance, management and other contracts and agreements related to the operation and management of the Subject Property. 4. Notices of Claims. Copies of all written notices actually received by City regarding any actual or potential claim, default, violation or liability with respect to the Subject Property. 5. Other Subject Property Documents. Copies of all the following documents, to the extent they are within City’s possession, custody, or control: preliminary title reports, surveys and recorded parcel/tract maps, plotted easements, property tax bills for the three (3) years prior to the date of this Agreement; assessment district information; aerial photographs of 655 Columbus and/or the Subject Property; environmental assessments; hazardous waste reports/toxic waste studies; flood zone maps; drainage facility studies; hydrology studies; soils and/or boring reports; utility studies; utility availability letters; tree studies/surveys; traffic, biological, acoustical studies/surveys; engineering and/or geotechnical studies; prior development applications/correspondence to/from the County of Solano, Solano County Department of Environmental Health, and related public agencies; prior architectural drawings, engineering drawings, construction drawings and any other drawings (including but not limited to site plans, building plans, elevations, schematics, renderings and details); environmental impact report(s); special studies zone; specific plan/planned community texts, and CC&Rs/design and review criteria; and documentation concerning the 655 Columbus or the Subject Property that was disclosed to City in connection with its acquisition of 655 Columbus.
Exhibit E Form of Grant Deed
RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: CITY OF VALLEJO Attn: City Attorney 555 Santa Clara Street Vallejo, CA 94590 _____________________________________________________________________________ (Space above line for Recorder’s use only) APN: 0081-040-100 (portion), 0081-040-880 (portion), 0081-191-010 (portion), 0081-040-110 (portion), and 0181-190-010 (portion) Property Address: None GRANT DEED The undersigned declares that the document to which this page is affixed and made a part of is exempt from the fee imposed by the Affordable Housing & Job Act (SB2) (GC 27388.1) and Restrictive Covenant Modification (GC 27388.2) ( ) Recorded [concurrently] in connection with a transfer of real property subject to the imposition of Documentary Transfer Tax per GC 27388.1 (a) (2) & Gov’t Code 27388.2(b). ( ) Recorded [concurrently] in connection with a transfer of real property that is residential dwelling to an owner-occupier per GC 27388.1(a)(2) & Gov’t Code 27388.2(b). ( ) Maximum fee of $225 has been reached per GC 27388.1(a)(1). ( ) Not related to real property GC 27388.1(a)(1). ( ) Transfer of real property subject to the imposition of Documentary Transfer Tax - GC 27388.1(a)(2) and 27388.2(b). ( ) Transfer of real property that is a residential dwelling to an owner-occupier - GC 27388.1(a)(2) and 27388.2(b). ( X ) Document is executed or recorded by the state or any county, municipality, or other political subdivision of the state – Gov’t Code 27388.1(a)(2) & Gov’t Code 27388.2(b). THIS PAGE ADDED TO PROVIDE EXEMPTION INFORMATION FOR THE BUILDING HOMES AND JOBS ACT FEE (SB-2; AFFORDABLE HOUSING FEE) ($3.00 Additional recording fee applies) and Restrictive Covenant Modification Fee ($2.00 Additional recording fee applies)
RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: CITY OF VALLEJO Attn: City Attorney 555 Santa Clara Street Vallejo, CA 94590 _____________________________________________________________________________ (Space above line for Recorder’s use only) APN: 0081-040-100 (portion), 0081-040-880 (portion), 0081-191-010 (portion), 0081-040-110 (portion), and 0181-190-010 (portion) Property Address: None The undersigned grantor(s) declare(s): Documentary Transfer Tax is: $0.00 [Cal. Govn’t. Code §§ 6103 and 27383] ( x ) computed on full value of property conveyed, or ( ) computed on full value of less of liens and encumbrances remaining at time of sale. ( ) unincorporated area: ( x ) City of Vallejo ( ) Signature of Declarant ________________________________________________ By: Michael Malone Its: City Manager GRANT DEED FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, the CITY OF VALLEJO, a municipal corporation, (“Grantor”), hereby grants to BLUE ROCK SPRINGS, LLC, a Delaware limited liability company, (“Grantee”), all right, title, and interest in and to that certain real property situated in the City of Sacramento, County Sacramento, State of California, as described in Exhibits A-1 through A-3, which is attached and incorporated in this Grant Deed by this reference. Grantor has caused this Grant Deed to be duly executed on December ___, 2022. [SIGNATURES FOLLOW]
IN WITNESS WHEREOF, the Parties have executed this Grant Deed as of the date and year first above written. THE CITY OF VALLEJO a municipal corporation _____________________________________ By: Michael Malone Its: City Manager ATTEST: _____________________________________ By: Dawn Abrahamson Its: City Clerk APPROVED AS TO CONTENT: _____________________________________ By: Gillian Hayes Its: Assistant City Manager APPROVED AS TO FORM: _____________________________________ By: Veronica A. F. Nebb Its: City Attorney
Exhibit A-1 | Page 1
Exhibit A-1 Legal Description – Residential West Parcel
Exhibit A-1 | Page 2
Exhibit A-1 | Page 3
Exhibit A-1 | Page 4
Exhibit A-2 | Page 1
Exhibit A-2 Legal Description – Commercial North Parcel
Exhibit A-2 | Page 2
Exhibit A-2 | Page 3
Exhibit A-2 | Page 4
Exhibit A-3 | Page 1
Exhibit A-3 Legal Description – Commercial South Parcel
Exhibit A-3 | Page 2
Exhibit A-3 | Page 3
Exhibit A-3 | Page 4
1. BasicProvisions ("BasicProvisions").
1.1 ParƟes. This Lease("Lease"), datedforreference purposesonly December ___, 2022 ,ismade byand between BLUE ROCK SPRINGS, LLC, a Delaware limited liability company ("Lessor")and CITY OF VALLEJO, a municipal corporation ("Lessee"), (collecƟvely the"ParƟes", orindividuallya "Party").
1.2 Premises: That certainreal property,includingall improvementsthereon ortobe providedby Lessorunderthe termsof thisLease, commonlyknownas (streetaddress, city,state, zip): n/a ("Premises"). ThePremises arelocatedin theCounty of Solano ,and aregenerally describedas (describe brieflythe natureof thepropertyand theimprovements onthe property,ifany,and, ifapplicable,the "Project",if thepropertyis locatedwithin aProject): a portion of the Blue Rock Springs Golf Course, more fully described on Exhibits A-1 through A-2 . (See alsoParagraph 2)
1.3 Term: Year-to-year, commencing on the date when Lessor takes title to the Premises (i.e., on or prior to December 30, 2022), and continuing thereafter, subject to (a) termination due to rescission as provided in Paragraph 51; or (b) termination by Lessor on 180 days' notice, following Lessor's receipt of entitlements to develop the Premises yearsand months ("OriginalTerm") commencing ("Commencement Date") andending ("ExpiraƟon Date"). (Seealso Paragraph3)
1.4 Early Possession: Ifthe Premisesareavailable Lesseemay havenon-exclusivepossession ofthe Premisescommencing n/a ("EarlyPossession Date"). (Seealso Paragraphs3.2and 3.3)
1.5 Base Rent: $1.00 per year; payable on the date of commencement, and annually thereafter permonth ("BaseRent"), payableon the dayof eachmonthcommencing . (Seealso Paragraph4) Ifthis boxis checked,thereare provisionsin thisLease fortheBase Rentto beadjusted. SeeParagraph .
1.6 Base Rentand OtherMonies PaidUpon ExecuƟon:
1.7 Agreed Use: Continued use and operation of a golf course, and attendant uses consistent with Lessee's use of the Premises prior to commencement . (See alsoParagraph 6)
1.8 Insuring Party. Lessoris the"InsuringParty". The annual"BasePremium" is TBD . (See alsoParagraph8)
1.9 n/a[nobrokers] Real EstateBrokers. (Seealso Paragraph15 and25) agency relaƟonships inthis Leasewiththe followingreal estatebrokers("Broker(s)")and/ortheir agents("Agent(s)"):
Lessor'sBrokerage Firm License No. Isthe brokerof(check one): theLessor;or both theLessee andLessor(dual agent).
Lessor'sAgent LicenseNo. is(check one): theLessor'sAgent (salespersonor brokerassociate);or both theLessee's Agentand theLessor's Agent(dualagent).
Lessee'sBrokerage Firm License No. Isthe brokerof(check one): theLessee;or both theLessee andLessor(dual agent).
Lessee'sAgent LicenseNo. is (checkone): theLessee's Agent(salesperson orbrokerassociate); or boththe Lessee's Agentand theLessor's Agent(dualagent).
separate wriƩen agreement(or ifthereis nosuch agreement,the sumof or % ofthetotal BaseRent) forthe brokerageservicesrendered bythe Brokers.
1.10n/a Guarantor. The obligaƟons ofthe Lesseeunderthis Leaseare tobeguaranteed by ("Guarantor"). (SeealsoParagraph37)
1.11 AƩachments. AƩachedhereto arethe following,allof which consƟtute apartof thisLease:
anAddendum consisƟngof Paragraphs 51 through ;
STANDARDINDUSTRIAL/COMMERCIAL LAND LEASE-GROSS
(DONOTUSETHISFORMFORBUILDINGSORFORLEASESPROVIDINGFORTHECONSTRUCTIONOFBUILDINGS) (a) Base Rent: n/a for theperiod .
(b) SecurityDeposit: n/a ("SecurityDeposit"). (Seealso Paragraph5) (c) Other: n/a for .
(d) TotalDue Upon ExecuƟon ofthisLease: n/a .
(a) RepresentaƟon: Each Partyacknowledgesreceiving aDisclosure RegardingReal EstateAgencyRelaƟonship, confirmsand consentstothe following (b) Paymentto Brokers. Upon execuƟonand deliveryof thisLeaseby both ParƟes, Lessorshall paytothe Brokersthe brokeragefeeagreed toin a aplot plan depicƟng thePremises;
acurrent setof theRulesand RegulaƟons;
aWork LeƩer;
other(specify): legal description .
2. Premises.
2.1 Leƫng. Lessor herebyleases toLessee,and Lesseehereby leasesfromLessor,thePremises, fortheterm, atthe rental,and uponallof theterms, covenantsand condiƟonsset forthinthis Lease. Whilethe approximatesquarefootageofthe Premisesmay havebeenused inthe markeƟngofthe Premisesfor purposesof comparison,the BaseRentstated hereinis NOT Ɵed tosquarefootageandis notsubjectto adjustmentshould theactualsize bedetermined tobe different. NOTE: Lesseeisadvised toverify theactual sizepriorto execuƟngthis Lease.
2.2 SeeAddendum CondiƟon. Lessor shalldeliver thePremisesto Lesseefree ofdebrison theCommencement Dateor theEarlyPossession Date, whichever first occurs("Start Date"),andwarrants thatthe exisƟngelectrical, plumbing,lighƟng,if any,and allothersuch elementsin thePremises,other thanthose constructedby Lessee,shall beingood operaƟng condiƟon onsaid date. If anon-compliance withsaidwarranty existsas oftheStart Date,or ifone ofsuchsystems orelements should malfuncƟon orfailwithin thewarranty period,Lessor shall,asLessor's sole obligaƟon withrespectto such maƩer,exceptasotherwise providedin thisLease, promptly aŌer receiptof wriƩen noƟcefrom Lessee seƫng forthwith specificity thenature andextentof suchnon-compliance, malfuncƟon orfailure, recƟfysame atLessor's expense. The warrantyperiod shallbe 30days. IfLessee doesnotgive Lessorthe required noƟcewithin theappropriate warrantyperiod, correcƟonof anysuch non-compliance, malfuncƟonor failureshall bethe obligaƟonofLessee atLessee's solecostand expense. Lessoralsowarrants, thatunless otherwise specified in wriƟng, Lessorisunaware of(i) anyrecorded NoƟcesofDefault affecƟngthe Premise;(ii)any delinquentamounts dueunderany loansecured bythe Premises;and (iii)anybankruptcy proceeding affecƟng thePremises.
2.3 SeeAddendum Compliance. Lessor warrantsthat tothebest ofits knowledgetheimprovements onthe Premisescomply withthebuilding codes,applicable laws,covenants or restricƟonsof record, regulaƟons, andordinances ("ApplicableRequirements")that werein effectatthe Ɵmethat each improvement,or porƟonthereof, wasconstructed. Saidwarranty doesnot applytothe useto whichLesseewill putthe Premises, modificaƟonswhich maybe requiredby theAmericans with DisabiliƟesAct orany similarlaws asaresult ofLessee's use(seeParagraph50),or toany AlteraƟons or UƟlity InstallaƟons(as defined inParagraph7.3(a))made ortobe madeby Lessee. NOTE:Lesseeis responsiblefor determiningwhetheror notthe ApplicableRequirements,and especiallythe zoning,are appropriatefor Lessee'sintendeduse, andacknowledges thatpast usesofthe Premisesmay nolongerbe allowed. IfthePremises donot complywith saidwarranty,Lessorshall, exceptasotherwise provided,promptly aŌerreceipt of wriƩen noƟce fromLessee seƫngforthwith specificitythe natureandextent of suchnon-compliance, recƟfythe sameatLessor's expense. IfLessee doesnotgive Lessor wriƩen noƟceofa non-compliancewith thiswarrantywithin 6months followingthe StartDate, correcƟonofthat non-complianceshall bethe obligaƟonofLessee atLessee's solecostand expense.
2.4 Acknowledgements. Lessee acknowledgesthat: (a)it hasbeen givenanopportunity toinspect andmeasurethe Premises,(b) ithas beenadvisedby Lessorand/or Brokersto saƟsfyitselfwith respectto thesize and condiƟonof thePremises (includingbutnot limitedto theimprovements,if any,security, environmental aspects,and compliancewithApplicable Requirementsand theAmericans with DisabiliƟesAct), andtheir suitabilityforLessee's intendeduse, (c) Lesseehas madesuch invesƟgaƟonasit deemsnecessary withreference tosuch maƩers andassumes allresponsibilitytherefor asthe samerelateto itsoccupancy of thePremises, (d)it isnotrelying onany representaƟonas tothesize ofthe Premisesmadeby Brokersor Lessor,(e)the squarefootageofthe Premiseswasnot materialto Lessee'sdecision toleasethe Premisesand paythe Rentstatedherein, and(f) neitherLessor,Lessor's agents,nor Brokershavemade anyoral or wriƩen representaƟonsor warranƟeswith respecttosaid maƩersother thanas setforthin thisLease. In addiƟon,Lessoracknowledges that:(i) Brokershavemade no representaƟons,promises or warranƟes concerningLessee'sability tohonor theLease orsuitabilityto occupythe Premises,and(ii) itis Lessor'ssoleresponsibility to invesƟgatethe financialcapability and/orsuitabilityof allproposed tenants.
2.5 Lessee asPrior Owner/Occupant. The warranƟesmade byLessor inParagraph2 shallbe ofnoforce or effect ifimmediatelyprior tothe StartDate Lessee wasthe owneror occupantofthe Premises. Insuch event,Lesseeshall beresponsible foranynecessary correcƟvework.
3. Term.
3.1 Term. The CommencementDate, ExpiraƟonDateand OriginalTermofthisLease areas specifiedinParagraph 1.3.
3.2 Early Possession. Anyprovision herein granƟngLessee EarlyPossession ofthePremises issubject toand condiƟoned uponthe Premisesbeing availablefor suchpossession priorto theCommencement Date. Any grantof EarlyPossessiononly conveysa non-exclusiverightto occupythe Premises. If Lesseetotally or parƟallyoccupies thePremises priortothe CommencementDate, the obligaƟon topayBase Rentshall beabatedfor theperiod ofsuchEarly Possession. Allother termsof thisLease(withtheexceptiontheobligationstopayRealPropertyTaxesandinsurancepremiums) shallbeineffectduringsuchperiod,andLesseeshallhaveadutytomaintainthePremises. (includingbut notlimited tothe obligaƟonstopay RealProperty Taxesand insurancepremiumsand tomaintain thePremises)shall bein effectduringsuch period. Anysuch Early Possessionshall not affect the ExpiraƟonDate.
3.3 DelayInPossession. Lessor agreestouse commerciallyreasonable effortsto deliverexclusivepossession ofthe PremisestoLessee bythe CommencementDate. If, despitesaid efforts, Lessoris unableto deliverpossessionby suchdate, Lessorshallnot besubject toanyliability therefor,nor shallsuch failure affect thevalidity ofthisLease orchange the ExpiraƟon Date. Lessee shallnot, however,beobligated topay Rentorperform itsother obligaƟons unƟl Lessor deliverspossession ofthe Premisesandany periodof rentabatement thatLesseewould otherwisehave enjoyedshallrun fromthe dateofdelivery ofpossession and conƟnuefor aperiod equaltowhat Lesseewould otherwisehave enjoyedunderthe termshereof,butminusany daysof delaycausedby theacts oromissions of Lessee. Ifpossession isnotdelivered within60 days aŌer theCommencementDate, Lesseemay,atits opƟon, by noƟce in wriƟngwithin 10days aŌerthe endofsuch 60day period,cancel thisLease,in whichevent the ParƟes shallbedischarged fromall obligaƟonshereunder. Ifsuch wriƩen noƟceis notreceived byLessor within said10 dayperiod, Lessee'srightto cancelshall terminate. Ifpossessionof thePremises isnotdelivered within120 days aŌerthe CommencementDate, thisLease shallterminate unlessother agreementsarereached betweenLessor andLessee, in wriƟng.
3.4 Lessee Compliance. Lessorshallnot berequired totender possessionofthe Premisesto Lessee unƟlLessee complieswith its obligaƟonto provide evidenceof insurance(Paragraph 8.5). Pending deliveryof suchevidence, Lesseeshallbe requiredto performallof its obligaƟons underthisLease fromand aŌerthe StartDate, includingthe paymentofRent, notwithstandingLessor's elecƟonto withholdpossessionpending receiptof suchevidenceof insurance. Further,ifLessee isrequired toperform anyother condiƟons priorto orconcurrent withtheStart Date,the StartDateshall occurbut Lessormayelect towithhold possession unƟl such condiƟonsare saƟsfied.
4. Rent.
4.1 Rent Defined. Allmonetary obligaƟonsofLessee toLessor undertheterms ofthis Lease(exceptfor theSecurity Deposit)are deemedtobe rent("Rent").
4.2 Payment. Lessee shallcause paymentofRent tobe receivedbyLessor inlawful moneyofthe UnitedStates, without offset or deducƟon(except as specifically permiƩed inthis Lease),onor beforethe dayon whichitis due. Allmonetaryamounts shallbe roundedtothe nearestwhole dollar. Intheevent thatany invoiceprepared byLessor isinaccuratesuch inaccuracyshall not consƟtute awaiverand Lesseeshall beobligatedto paythe amountsetforth inthis Lease,with theexceptionoftheBaseRent. Rent foranyperiod duringthe termhereof whichisfor lessthan onefullcalendar monthshall beproratedbased uponthe actualnumber ofdaysof saidmonth. Payment ofRentshall bemade toLessorat itsaddress statedhereinor tosuch otherpersons orplaceas Lessormay from Ɵme to Ɵme designatein wriƟng. Acceptance ofa paymentwhichis lessthan theamountthen dueshall notbea waiverof Lessor'srights tothebalance ofsuch Rent,regardless ofLessor's endorsementofany checkso staƟng. Intheevent thatany check,draŌ,or otherinstrument ofpaymentgiven byLessee toLessor is dishonoredfor anyreason, Lesseeagreesto payto Lessorthe sumof$25 in addiƟon toanyLate Chargeand Lessor,atits opƟon,may requireall futurepaymentsto bemade byLessee tobeby cashier'scheck. Payments willbeapplied firstto accruedlatecharges and aƩorney's fees,secondto accruedinterest, thento BaseRent and OperaƟng ExpenseIncrease, andanyremaining amountto anyother outstandingchargesor costs.
5. SecurityDeposit. Lesseeshall depositwith Lessorupon execuƟonhereofthe SecurityDeposit assecurityfor Lessee'sfaithful performanceofits obligaƟons underthis Lease. IfLesseefails topay Rent,or otherwiseDefaultsunder thisLease, Lessormayuse, applyor retainallor any porƟon ofsaid SecurityDepositfor the paymentof anyamount alreadydueLessor,forRents whichwill beduein thefuture, and/orto reimburseor compensateLessorfor anyliability,expense,loss or damagewhich Lessormay sufferorincur byreason thereof. IfLessoruses orapplies allorany porƟonof theSecurityDeposit, Lesseeshall within10 days aŌer wriƩenrequest therefordeposit monieswithLessor sufficientto restoresaid SecurityDepositto thefull amountrequiredby thisLease. Ifthe BaseRent increases duringthe termof thisLease,Lessee shall,upon wriƩenrequest fromLessor,deposit addiƟonalmonies withLessorso thatthe totalamountof theSecurity Deposit shallat all Ɵmes bearthesame proporƟonto theincreased BaseRentas the iniƟal SecurityDepositbore tothe iniƟalBaseRent. Should theAgreed Usebeamended toaccommodate amaterial changeinthe businessof Lesseeor toaccommodatea sublesseeor assignee,Lessorshall havethe righttoincrease theSecurity Deposit tothe extentnecessary, inLessor'sreasonable judgment,to accountfor anyincreasedwear andtear thatthePremises may suffer asaresult thereof. Ifa changein controlof Lesseeoccurs duringthisLease andfollowing suchchange the financial condiƟon ofLessee is,inLessor's reasonablejudgment, significantlyreduced,Lessee shalldeposit such addiƟonal monieswithLessor asshall be sufficient tocausethe SecurityDeposit tobeat acommercially reasonablelevelbased onsuch changein financial condiƟon. Lessor shallnotbe requiredto keepthe SecurityDepositseparate fromits generalaccounts. Within90 days aŌerthe expiraƟonor terminaƟonof thisLease, Lessorshall returnthat porƟon ofthe SecurityDeposit notusedor appliedby Lessor. Lessor shallupon wriƩenrequestprovide Lesseewith an accounƟng showinghow that porƟon oftheSecurity Depositthat wasnot returnedwasapplied. No partofthe SecurityDeposit shallbeconsidered tobe heldin trust,tobear interestor tobe prepaymentforany moniesto bepaid byLesseeunder thisLease. THESECURITY DEPOSITSHALL NOTBEUSED BYLESSEE INLIEU OFPAYMENTOF THELAST MONTH'SRENT.
6. Use.
6.1 Use. Lessee shalluse andoccupythe Premisesonly fortheAgreed Use,or anyotherlegal usewhich isreasonably comparablethereto,and forno other purpose. Lesseeshall notuseor permitthe useof thePremisesin amanner thatisunlawful, createsdamage, wasteora nuisance,or thatdisturbs occupantsofor causesdamage toneighboring premisesor properƟes. Other thanguide, signalandseeing eyedogs, Lesseeshallnot keepor allowinthe Premisesany pets,animals, birds, fish, or repƟles. Lessorshall notunreasonably withholdor delayitsconsent toany requestfora modificaƟonof theAgreedUse, solong asthe samewillnot be significantlymore burdensometo thePremises. IfLessor electsto withholdconsent,Lessor shallwithin 7days aŌer suchrequest give wriƩen noƟficaƟon ofsame, which noƟce shallinclude an explanaƟonof Lessor's objecƟons tothe changeinthe AgreedUse.
6.2 Hazardous Substances.
(a) Reportable UsesRequire Consent. The term"Hazardous Substance"as usedinthis Leaseshall meananyproduct, substance,or wastewhose presence,use, manufacture,disposal, transportaƟon,orrelease, eitherby itselfor incombinaƟonwith othermaterials expectedtobe onthe Premises,iseither: (i) potenƟallyinjurious tothe publichealth,safety orwelfare, theenvironment orthePremises, (ii)regulated ormonitoredby anygovernmental authority,or(iii) abasis for potenƟal liabilityof Lessortoany governmentalagency orthird partyunderany applicablestatute orcommonlaw theory. HazardousSubstancesshall include,but notbe limitedto, hydrocarbons,petroleum,gasoline, and/orcrude oilor anyproducts,byproducts or fracƟons thereof. Lessee shallnot engageinany acƟvityin oron thePremises which consƟtutes aReportableUse ofHazardous Substanceswithout theexpressprior wriƩenconsent ofLessorand Ɵmelycompliance (atLessee's expense)with allApplicable Requirements. "Reportable Use"shall mean(i) the installaƟonor useof anyaboveor belowground storagetank,(ii) the generaƟon, possession,storage,use, transportaƟon, ordisposalof aHazardous Substancethat requiresapermit from,or withrespectto whicha report, noƟce, registraƟon or businessplan isrequired tobe filed with,any governmentalauthority,and/or(iii)the presenceat thePremisesof aHazardous Substancewithrespect towhich any ApplicableRequirements requiresthat a noƟcebe givento personsentering oroccupyingthe Premisesor neighboring properƟes. Notwithstandingthe foregoing, Lesseemay useany ordinaryandcustomary materialsreasonably requiredto beusedin thenormal courseofthe AgreedUse, ordinary officesupplies (copiertoner, liquidpaper,glue,etc.) andcommonhousehold cleaningmaterials, solong assuchuse isin compliancewithall ApplicableRequirements, isnota ReportableUse, and doesnot exposethe Premisesorneighboring propertyto anymeaningful riskof contaminaƟon ordamage orexposeLessor toany liabilitytherefor. In addiƟon, Lessormay condiƟonits consenttoany ReportableUse uponreceiving such addiƟonal assurances asLessor reasonablydeemsnecessary toprotect itself,thepublic, thePremises and/orthe environmentagainstdamage, contaminaƟon,injury and/orliability,including,butnot limitedto, the installaƟon(and removalon orbefore Lease expiraƟon or terminaƟon) of protecƟve modificaƟons (suchas concreteencasements) and/orincreasingthe SecurityDeposit. (b) Dutyto InformLessor. IfLessee knows,or hasreasonablecause tobelieve, thata HazardousSubstancehas cometo belocatedin, on,under or aboutthe Premises,other thanaspreviously consentedto byLessor,Lesseeshallimmediately give wriƩen noƟceofsuch factto Lessor,andprovide Lessorwith a copyof anyreport, noƟce,claimor other documentaƟon whichit hasconcerningthe presenceof suchHazardousSubstance. (c) Lessee RemediaƟon. Lessee shallnotcause orpermit anyHazardous Substancetobe spilledor releasedin,on, under,or aboutthePremises (includingthrough theplumbing orsanitarysewer system)and shallpromptly,atLessee'sexpense, complywith allApplicableRequirements andtake all invesƟgatory and/orremedial acƟonreasonably recommended,whetheror notformally orderedor required,forthe cleanupof any contaminaƟonof,andfor themaintenance, securityand/or monitoringof thePremisesor neighboring properƟes, thatwas causedormaterially contributedto byLessee,or pertainingto orinvolvingany HazardousSubstance broughtonto thePremisesduring theterm ofthis Lease,byor forLessee, oranythird party. (d) Lessee IndemnificaƟon. Lessee shallindemnify,defend andhold Lessor,itsagents, employees,lenders andground lessor,ifany,harmlessfrom and againstany andall lossofrents and/ordamages, liabiliƟes,judgments, claims,expenses,penalƟes, and aƩorneys' andconsultants'fees arisingout oforinvolving any HazardousSubstance broughtonto thePremisesby orfor Lessee,or anythirdparty (provided,however,thatLesseeshall haveno liabilityunderthis Leasewith respectto underground migraƟon ofanyHazardous Substanceunder thePremises fromadjacent properƟes notcaused orcontributedto byLessee). Lessee's obligaƟonsshall include,but notbelimited to,the effectsof any contaminaƟonor injuryto person,propertyor theenvironment createdor suffered byLessee, and thecost of invesƟgaƟon, removal, remediaƟon, restoraƟon and/orabatement, andshall survivethe expiraƟon or terminaƟon ofthisLease. No terminaƟon, cancellaƟonor releaseagreement enteredintoby Lessorand Lesseeshall releaseLesseefrom itsobligaƟons underthisLease withrespect toHazardous Substances,unless specificallyso agreedbyLessor in wriƟng atthe Ɵmeofsuch agreement. (e) Lessor IndemnificaƟon. Except asotherwise providedinparagraph 8.7,Lessor anditssuccessors andassigns shallindemnify, defend,reimburseand holdLessee, itsemployees andlenders,harmless fromand againstany andallenvironmental damages,including thecostof remediaƟon, whichresultfrom HazardousSubstances whichexisted onthePremises priorto Lessee'soccupancy orwhichare causedby thegrossnegligence orwillful misconductofLessor,its agentsor employees. Lessor's obligaƟons,as andwhen requiredby theApplicableRequirements, shallinclude, butnotbe limitedto,thecostof invesƟgaƟon, removal, remediaƟon, restoraƟonand/or abatement,andshall survivethe expiraƟonor terminaƟonofthis Lease. (f) InvesƟgaƟons and RemediaƟons. Lessorshall retaintheresponsibility andpay forany invesƟgaƟons or remediaƟon measuresrequired by governmental enƟƟes having jurisdicƟon withrespectto theexistence ofHazardous Substancesonthe Premisesprior toLessee'soccupancy, unlesssuch remediaƟon measureis requiredas aresultof Lessee'suse (including "AlteraƟons", as definedin paragraph7.3(a) below)ofthe Premises,in whicheventLessee shallbe responsiblefor suchpayment. Lesseeshall cooperatefully inany such acƟviƟesat therequest ofLessor,including allowingLessor andLessor'sagents tohave reasonableaccess tothe Premisesatreasonable Ɵmesin orderto carryoutLessor's invesƟgaƟveand remedial responsibiliƟes. (g) Lessor T erminaƟonOpƟon. If aHazardousSubstance CondiƟon(see Paragraph9.3(a))occurs duringthe termofthis Lease,unless Lesseeis legally responsibletherefor(inwhich caseLesseeshall makethe invesƟgaƟonand remediaƟonthereofrequired bythe ApplicableRequirementsand thisLease shall conƟnue infull forceand effect,butsubject toLessor's rightsunder Paragraph6.2(d)and Paragraph13), Lessormay,at Lessor's opƟon, either(i) invesƟgate andremediate such HazardousSubstance CondiƟon,if required,assoon asreasonably possibleat Lessor'sexpense,in whichevent thisLeaseshall conƟnuein fullforceand effect,or (ii)if the esƟmated costto remediatesuch condiƟon exceeds12 Ɵmesthe thenmonthlyBase Rentor$25,000 $100,000,whichever isgreater,give wriƩen noƟceto Lessee,within 30days aŌerreceiptby Lessorof knowledgeof theoccurrenceof suchHazardous Substance CondiƟon,of Lessor'sdesire toterminatethis Leaseas of thedate 60days followingthedate ofsuch noƟce.
6.3 Lessee's Compliance with ApplicableRequirements. Exceptas otherwiseprovided inthisLease, Lesseeshall, atLessee'ssole expense,fully,diligentlyand ina Ɵmelymanner,materiallycomplywith allApplicable Requirements,the requirementsofany applicable fire insuranceunderwriteror raƟngbureau, andthe recommendaƟonsof Lessor'sengineers and/orconsultantswhich relatein anymanner tothePremises, withoutregard towhethersaid ApplicableRequirements are nowin effector become effecƟve aŌer theStart Date. Lesseeshall,within 10days aŌerreceiptof Lessor's wriƩen request,provideLessor withcopies ofall permits andother documents,and other informaƟonevidencing Lessee'scompliance withany ApplicableRequirements specified byLessor,andshallimmediately upon receipt, noƟfy Lessorin wriƟng(withcopies ofany documentsinvolved) ofanythreatened oractual claim, noƟce, citaƟon, warning,complaint orreportpertaining to orinvolving thefailure ofLesseeor thePremises tocomply withanyApplicable Requirements.
6.4 InspecƟon; Compliance. Lessorand Lessor's"Lender"(as definedin Paragraph30)and consultantsauthorized byLessorshall havethe rightto enteronto Premisesat any Ɵme inthecase ofan emergency,and otherwiseatreasonable Ɵmes aŌer reasonable noƟce,for thepurpose of inspecƟngand/or tesƟngthe condiƟonof thePremises and/orforverifying complianceby Lesseewith thisLease. Thecost ofanysuch inspecƟonsshall bepaidby Lessor,unless a violaƟon of ApplicableRequirements, ora HazardousSubstance CondiƟon (seeParagraph9.3(a))is foundtoexist orbe imminent,orthe inspecƟonis requestedorordered bya governmentalauthority. In suchcase, Lesseeshallupon requestreimburse Lessorforthe costof such inspecƟon, solongas such inspecƟon isreasonablyrelated to the violaƟon or contaminaƟon. In addiƟon, Lesseeshall providecopies ofallrelevant materialsafety datasheets(MSDS) toLessor within10days ofthe receiptof a wriƩenrequest therefor. Lesseeacknowledgesthat anyfailure onits parttoallow such inspecƟons or tesƟngwill exposeLessor torisksand potenƟallycause Lessor toincur costsnot contemplatedbythis Lease,the extentof whichwillbe extremely difficult toascertain. Accordingly,should theLesseefail toallow such inspecƟons and/or tesƟng ina Ɵmelyfashionthe BaseRentshallbe automaƟcallyincreased,without anyrequirement for noƟceto Lessee,by anamountequal to10% ofthe then exisƟng BaseRent or$100,whichever isgreater forthe remaindertothe Lease. The ParƟesagree thatsuch increaseinBase Rentrepresents fairand reasonable compensaƟonfor the addiƟonal risk/coststhatLessor willincur byreason ofLessee'sfailure toallow such inspecƟonand/or tesƟng. Suchincreasein BaseRentshall inno event consƟtute awaiverof Lessee'sDefault orBreach withrespectto suchfailure norpreventthe exerciseof anyofthe otherrights andremedies granted hereunder.
7. Maintenance;Repairs; UƟlity InstallaƟons;TradeFixturesand AlteraƟons.
7.1 Lessee's ObligaƟons.
(a) In General. Subjectto theprovisionsof Paragraph2.2 (CondiƟon), 2.3(Compliance), 6.3(Lessee's Compliancewith ApplicableRequirements),7.2 (Lessor's ObligaƟons), 9(Damage or DestrucƟon),and 14 (CondemnaƟon), Lesseeshall, atLessee'ssole expense,keep thePremises, ingoodorder, condiƟonand repair(whether ornot theneedfor suchrepairs occursas aresultof Lessee'suse, anyprioruse, theelements ortheage ofsuch porƟonof thePremises),including, butnot limitedto, plumbing, lighƟng faciliƟes, landscaping,driveways, parkinglots, fences,retainingwalls, signs,sidewalks andparkwayslocated on,or adjacentto, thePremises. Lessee, inkeepingthe Premisesin goodorder, condiƟonandrepair,shallexercise andperformgood maintenance pracƟces, specificallyincludingthe procurementand maintenanceof theservicecontracts requiredby Paragraph7.1(b) below. Lessee's obligaƟonsshall include restoraƟons,replacements orrenewals whennecessary tokeep thePremisesand allimprovements thereonor apartthereof ingood order,condiƟonand stateof repair. Lessee shall,during theterm ofthis Lease,keep theappearance ofthePremises ina first-class condiƟon (including,e.g. graffiƟ removal). (b) ServiceContracts. Lessee shall,atLessee's soleexpense, procureandmaintain acontract, withcopies toLessor,in customaryform andsubstance for,and witha contractorspecializingand experiencedin themaintenance ofthelandscaping andirrigaƟon systems,However,Lessor reservesthe right,upon noƟce toLessee, toprocure andmaintainsuch servicecontract, andLessee shallreimburseLessor,upondemand, forthecost thereof. (c) Failureto Perform. IfLesseefails toperform Lessee's obligaƟons underthisParagraph7.1,Lessor mayenterupon thePremises aŌer10days' prior wriƩen noƟce toLessee (exceptinthe caseof anemergency,inwhichcase no noƟce shallberequired), performsuch obligaƟonsonLessee's behalf,and putthe Premisesin goodorder, condiƟonandrepair,andLessee shallpromptly paytoLessor asum equalto115% ofthe costthereof.
Notwithstandinganythingtothecontraryherein,Lesseeshallnotberequiredtomakecapital improvementsorotherimprovementstothePremises. Itsmaintenanceandrepairobligationsshall belimitedtotheactivitiesthatarecommerciallyreasonabletopermitthePremisestocontinuetobe operatedasagolfcourse.
7.2 Lessor's ObligaƟons. Subjectto theprovisionsof Paragraphs2.2 (CondiƟon),2.3 (Compliance),9(Damage or DestrucƟon) and14 (CondemnaƟon), iIt is intendedby the ParƟes heretothatLessor haveno obligaƟon,in anymannerwhatsoever,torepair andmaintainthe Premises. Itisthe intenƟonof the ParƟes that theterms ofthis Leasegovernthe respecƟve obligaƟons ofthe ParƟesasto maintenanceand repairofthe Premises,and theyexpresslywaive the benefit ofany statutenow or hereaŌer in effectto theextent itis inconsistentwiththe termsof thisLease.
7.3 UƟlity InstallaƟons;TradeFixtures; AlteraƟons.
(a) DefiniƟons. The term"UƟlity InstallaƟons" refersto securityand fire protecƟonsystems, lighƟng fixtures, plumbing,andfencing onthe Premises.
Theterm "TradeFixtures" shallmeanLessee's machineryand equipmentthat canberemoved withoutdoing materialdamageto thePremises. Theterm "AlteraƟons"shall meanany modificaƟonofthe improvements,other than UƟlity InstallaƟonsorTradeFixtures,whether by addiƟonor deleƟon. "LesseeOwned AlteraƟonsand/or UƟlity InstallaƟons" are definedas AlteraƟonsand/or UƟlity InstallaƟons madebyLessee thatare notyetowned byLessor pursuanttoParagraph
7.4(a).
(b) Consent. Lesseeshall notmakeany AlteraƟonsor UƟlity InstallaƟonsto thePremises withoutLessor's prior wriƩenconsent. Lessee may,however, makenon-structural AlteraƟonsor UƟlity InstallaƟonsto thePremises withoutsuch consentbutupon noƟceto Lessor,aslong asthe cumulaƟvecostthereof during thisLease asextended doesnotexceed asum equalto 3month'sBase Rentin theaggregateor asum equaltoone month'sBase Rentin anyoneyear. Lessor may,as a precondiƟon to granƟng suchapproval,require Lesseeto uƟlizea contractorchosenand/or approvedby Lessor. Any AlteraƟonsor UƟlity InstallaƟonsthat Lessee shalldesire tomake andwhichrequire theconsent ofthe Lessorshallbe presentedto LessorinwriƩen formwith detailedplans. Consentshall bedeemed condiƟonedupon Lessee's: (i)acquiringall applicablegovernmental permits,(ii) furnishingLessorwith copiesof boththepermits andthe plansand specificaƟons priorto commencementof thework,and (iii)compliance withall condiƟonsofsaid permitsand otherApplicableRequirements ina promptand expediƟous manner.
Any AlteraƟons or UƟlity InstallaƟonsshallbe performedin aworkmanlike mannerwithgood andsufficient materials,inLessor'sdiscretion,with nofurthernoticetoLessee. Lessee shallpromptly upon compleƟonfurnish Lessorwith as-builtplansand specificaƟons. Forwork whichcostsan amountin excessof onemonth'sBase Rent,Lessor may condiƟon itsconsentupon Lesseeproviding alienand compleƟonbond inanamount equalto 150%of the esƟmatedcost ofsuch AlteraƟonor UƟlity InstallaƟonand/or uponLessee's posƟngan addiƟonal SecurityDeposit withLessor. (c) Liens;Bonds. Lessee shallpay,when due,all claimsfor laborormaterials furnishedor allegedtohave beenfurnished toorfor Lesseeat orfor useon thePremises, whichclaims areormay besecured byany mechanic'sormaterialmen's lienagainst thePremisesor anyinterest therein. Lessee shallgive Lessornot lessthan 10days noƟcepriorto thecommencement ofany workin,on orabout thePremises,and Lessorshall havetheright topost noƟcesof non-responsibility. If Lesseeshall contestthe validityofany suchlien, claimor demand,thenLessee shall,at itssoleexpense defendand protectitself,Lessor andthe Premisesagainst the sameand shallpay and saƟsfyany suchadverse judgmentthat mayberendered thereonbefore theenforcementthereof. If Lessorshall require,Lesseeshall furnish asurety bondin anamountequal to150% ofthe amountofsuch contestedlien, claimordemand, indemnifyingLessor againstliabilityfor thesame. If Lessorelects to parƟcipate inany such acƟon,Lessee shallpay Lessor's aƩorneys' feesandcosts.
7.4 Ownership; Removal;Surrender; and RestoraƟon.
(a) Ownership. Subject toLessor'sright torequire removalor electownershipas hereinaŌerprovided, all AlteraƟonsand UƟlity InstallaƟons madeby Lesseeshall bethe propertyofLessee, butconsidered apart ofthePremises. Lessor may,atany Ɵme,elect in wriƟngto bethe ownerof allorany specifiedpart of theLessee Owned AlteraƟons and UƟlity InstallaƟons. Unless otherwiseinstructed perparagraph7.4(b) hereof,all LesseeOwned AlteraƟons and UƟlity InstallaƟons shall,at the expiraƟon or terminaƟonof thisLease, becomethe propertyofLessor andbe surrenderedbyLessee withthe Premises. (b) Removal. Bydelivery toLesseeof wriƩen noƟce fromLessornot earlierthan 90and notlaterthan 30days priortothe endof thetermof thisLease, Lessormay requirethat anyorall LesseeOwned AlteraƟonsor UƟlity InstallaƟonsbe removedby the expiraƟonor terminaƟonof thisLease. Lessormay requirethe removalat any Ɵme ofallor anypart ofany LesseeOwned AlteraƟons or UƟlity InstallaƟonsmadewithout therequired consent. (c) Surrender; RestoraƟon. Lessee shallsurrenderthe Premisesby the ExpiraƟon Dateorany earlier terminaƟon date,withall ofthe improvements, partsand surfacesthereof broomcleanand freeof debris,and ingood operaƟng order, condiƟon andstateof repair,ordinary wearandtear excepted. "Ordinary wearand tear"shall notincludeany damageor deterioraƟonthat wouldhavebeen preventedby goodmaintenance pracƟce. Notwithstanding theforegoingand the provisionsof Paragraph7.1(a), iftheLessee occupiesthe Premisesfor 12monthsor less,then Lesseeshallsurrender thePremises inthesame condiƟonas delivered toLessee onthe StartDatewith NOallowance forordinary wearandtear. Lessee shallrepairany damageoccasioned bythe installaƟon, maintenanceor removalof TradeFixtures, Lesseeowned AlteraƟonsand/or UƟlity InstallaƟons,furnishings, andequipment aswellas theremoval ofanystoragetankinstalled byorfor Lessee.
Lesseeshall alsocompletely removefromthe Premisesany andall HazardousSubstancesbrought ontothe Premisesbyor forLessee, oranythird party(except HazardousSubstances whichwere depositedviaunderground migraƟonfrom areasoutside ofthePremises) tothe level specifiedin ApplicableRequirements. Trade Fixturesshall remainthe propertyofLessee andshall beremoved byLessee. Anypersonal propertyofLessee notremoved onorbefore the ExpiraƟon Dateor any earlier terminaƟon dateshall bedeemedto havebeen abandonedby Lesseeandmay bedisposed oforretained byLessor asLessormay desire. Thefailure byLessee to Ɵmely vacatethe Premisespursuantto thisParagraph 7.4(c)without theexpress wriƩen consentof Lessorshall consƟtute aholdover undertheprovisions of Paragraph26 below.
8. Insurance;Indemnity.
8.1 Payment ofInsurance Premiums. Increases.
(a) Lessee shallpay toLessorthecostofinsurancepremiumsforliabilityandpropertyinsurancecarried byLessorasprovidedinthisLease.Innoevent,however,shallLesseeberesponsibleforanyportion ofsuchpremiumsattributabletoliabilityinsurancecarriedbyLessorunderParagraph8.2(b)in excessof$2,000,000peroccurrence.any insurancecost increase("Insurance CostIncrease") occurringduringthe termof thisLease.
InsuranceCost Increaseis definedasany increasein theactual costofthe insurancerequired underParagraph8.2(b), 8.3(a)and 8.3(b),overand abovethe Base Premiumas hereinaŌer defined calculatedonan annualbasis. Insurance CostIncreaseshall includebut notbelimited toincreases resulƟngfromthe natureof Lessee'soccupancy, anyact oromissionof Lessee,requirements ofthe holderofmortgage ordeed oftrustcovering thePremises, increased valuaƟonof thePremises and/ora premiumrateincrease. The parƟesare encouragedto fillinthe BasePremium inparagraph1.8 witha reasonablepremiumfor suchinsurance basedon the AgreedUse ofthe Premises. If the parƟes failto insertadollar amountin Paragraph1.8,then theBase Premiumshallbe thelowest annualpremium reasonably obtainablefor therequired insuranceasof thecommencement ofthe OriginalTermfor theAgreed Useofthe Premises. Innoevent, however,shall Lesseebe responsiblefor any porƟon oftheincrease inthe premiumcost aƩributabletoliability insurancecarried byLessorunder Paragraph8.2(b) inexcessof $2,000,000per occurrence.
(b) Lesseeshall paysuchpremiumcoststoLessorwithin30daysafterreceiptbyLesseeforacopyof thepremiumstatementorotherreasonableevidenceoftheamountdue.Premiumsforpolicyperiods commencingpriorto,orextendingbeyondthetermofthisLease,shallbeproratedtocorrespondto thetermofthisLease. any suchInsurance CostIncrease toLessorwithin 30days aŌerreceiptby Lesseeof acopyof thepremium statementor other reasonableevidence ofthe amountdue. Ifthe insurancepolicies maintainedhereundercover otherproperty besidesthePremises, Lessorshall alsodeliverto Lessee astatement ofthe amountofsuch InsuranceCost Increase aƩributable onlytothe Premisesshowing inreasonabledetail themanner inwhichsuch amountwas computed. Premiumsfor policyperiodscommencing priorto, orextending beyondtheterm ofthis Lease,shallbe proratedto correspondtothe termof thisLease.
8.2 Liability Insurance.
(a) Carried byLessee. Lesseeshall obtainand keepin forceaCommercial GeneralLiability policyofinsurance protecƟngLessee andLessoras an addiƟonalinsured againstclaims forbodilyinjury,personalinjury andproperty damagebasedupon orarising outofthe ownership,use, occupancyormaintenance of thePremises andall areasappurtenantthereto. Such insuranceshall beonan occurrencebasis providingsinglelimit coveragein anamountnot lessthan $1,000,000 peroccurrence withan annualaggregateof notless than$2,000,000. Lesseeshall addLessor asan addiƟonal insuredby meansofan endorsementat leastas broad asthe InsuranceService OrganizaƟon's "AddiƟonalInsured-Managers orLessors ofPremises" Endorsement. The policyshall notcontainany intra-insuredexclusions asbetween insuredpersons or organizaƟons,but shallinclude coveragefor liabilityassumedunder thisLease asan"insured contract"for theperformanceof Lessee's indemnity obligaƟons underthis Lease. The limitsof saidinsurance shallnot,however,limitthe liabilityofLessee norrelieve Lesseeofany obligaƟonhereunder.
Lesseeshall providean endorsementonits liabilitypolicy(ies) whichprovides thatitsinsurance shallbe primarytoand notcontributory withanysimilar insurance carriedby Lessor,whose insuranceshallbe consideredexcess insuranceonly. (b) Carriedby Lessor. Lessorshallmaintain liabilityinsurance asdescribedin Paragraph8.2(a), in addiƟon to,andnot inlieu of,theinsurance requiredto bemaintained byLessee. Lesseeshall notbe namedas an addiƟonalinsured therein.
8.3 Property Insurance- Improvementsand RentalValue.
(a) Improvements. The InsuringPartyshall obtainand keepin forceapolicy orpolicies inthename ofLessor,withlosspayable toLessor,any ground-lessor,and toany Lenderinsuringloss ordamage tothe Premises. The amountof suchinsuranceshall beequal tothefull insurablereplacement costof the Premises,as thesame shallexistfrom Ɵmeto Ɵme,or theamountrequired byany Lender,butin noevent morethanthe commerciallyreasonable andavailable insurablevalue thereof. LesseeOwned AlteraƟons and UƟlity InstallaƟons,TradeFixtures,andLessee's personalproperty shallbeinsured byLessee andnotby Lessor. Ifthe coverageisavailable andcommercially appropriate,such policyorpolicies shallinsure againstallrisks ofdirect physicallossor damage(except theperils of flood and/orearthquake unlessrequired byaLender orincluded intheBase Premium),including coveragefor debrisremovaland theenforcement ofany ApplicableRequirements requiringthe upgrading, demoliƟon, reconstrucƟon orreplacement ofany porƟonofthe Premisesas theresultof acovered loss. Said policy orpolicies shallalso containanagreed valuaƟonprovision inlieu ofanycoinsurance clause,waiver of subrogaƟon,and inflaƟonguard protecƟoncausingan increase inthe annualproperty insurancecoverageamount bya factorof notlessthan theadjusted U.S.Departmentof LaborConsumer PriceIndexfor AllUrban Consumers forthe citynearest towherethe Premisesare located. Ifsuchinsurance coveragehas a deducƟbleclause, the deducƟble amountshallnot exceed$5,000 per occurrence,and Lesseeshall beliablefor such deducƟble amountin theeventof anInsured Loss. (b) RentalValue. TheInsuring Partyshall obtainand keepinforce apolicy orpoliciesin thename ofLessorwith losspayable toLessor andanyLender, insuringthe lossof thefullRent forone yearwith anextendedperiod ofindemnity foran addiƟonal 180days ("RentalValueinsurance"). Said insuranceshall contain anagreed valuaƟonprovision inlieuof anycoinsurance clause,and theamountof coverageshall beadjustedannually to reflect theprojectedRent otherwisepayable byLessee, forthe next12month period. Lesseeshall beliablefor any deducƟble amountinthe eventof suchloss. (c) AdjacentPremises. If thePremisesare partof alarger propertyownedby Lessor, theLesseeshall payfor anyincreasein thepremiums forthe propertyinsurance ofsuch adjacentpropertyif saidincrease iscaused byLessee'sacts, omissions,use oroccupancyof thePremises.
8.4 Lessee's Property;Coverage; Worker's CompensaƟon Insurance. (a) Property Damage. Lesseeshallobtain andmaintain insurancecoverage onallof Lessee'spersonal property,TradeFixtures, andLessee Owned AlteraƟonsand UƟlity InstallaƟons. Suchinsurance shallbe fullreplacement costcoveragewith a deducƟble ofnotto exceed$1,000 peroccurrence. Theproceeds fromany suchinsurance shallbeused byLessee forthe replacementofpersonal property,TradeFixturesandLessee Owned AlteraƟons and UƟlity InstallaƟons. (b) Worker's CompensaƟon Insurance. Lesseeshallobtain andmaintain Worker's CompensaƟonInsurance insuch amountas mayberequired by ApplicableRequirements. Such policyshallinclude a"Waiver of SubrogaƟon" endorsement. Lessee shallprovide Lessorwitha copyof suchendorsementalong with the cerƟficate ofinsurance orcopyof thepolicy requiredby paragraph8.5. (c) No RepresentaƟon ofAdequate Coverage. Lessor makesno representaƟonthat thelimitsor formsof coverageofinsurance specifiedherein are adequateto coverLessee's property,business operaƟons or obligaƟons underthis Lease.
8.5 Insurance Policies. Insurancerequired hereinshallbe bycompanies maintainingduringthe policyterm a"GeneralPolicyholders RaƟng"of atleast A-,VII, asset forthin themostcurrent issueof "Best'sInsurance Guide",orsuch other raƟng asmaybe requiredby aLender. Lesseeshall notdo orpermitto bedone anythingwhich invalidatesthe requiredinsurancepolicies. Lessee shall,prior totheStart Date,deliver toLessor cerƟfied copiesof policiesofsuch insuranceor cerƟficateswith copiesof therequiredendorsements evidencingthe existenceand amountsofthe requiredinsurance. Nosuch policyshall becancelableor subject to modificaƟon except aŌer 30daysprior wriƩen noƟce toLessor. Lesseeshall, atleast 10daysprior tothe expiraƟonofsuch policies,furnish Lessorwith evidenceof renewalsor "insurancebinders" evidencingrenewalthereof, orLessor mayincrease hisliabilityinsurance coverageand chargethecost thereofto Lessee,which amountshall bepayable byLesseeto Lessorupon demand. Suchpoliciesshall befor atermof atleast oneyear,or thelength ofthe remainingtermof thisLease, whicheveris less. IfeitherParty shallfail toprocure andmaintainthe insurancerequired tobecarried byit, theotherParty may,but shallnot berequiredto,procure andmaintain thesame.Notwithstandinganythingtothecontraryherein,LessoracknowledgesthatLessee mayelecttoself-insureLessee’sobligationtocarryliabilityinsuranceasprovidedinSection8.2(b).
8.6 Waiver of SubrogaƟon. Without affecƟnganyother rightsor remedies,Lesseeand Lessoreach herebyreleaseand relievethe other,and waivetheir enƟre rightto recoverdamages againsttheother,forloss ofor damagetoits propertyarising outofor incidentto theperilsrequired tobe insuredagainst herein. The effectof suchreleases andwaiversis notlimited bythe amountofinsurance carriedor required,orby any deducƟbles applicablehereto. The ParƟes agreeto have their respecƟve propertydamage insurancecarrierswaive anyright to subrogaƟon thatsuchcompanies mayhave againstLessoror Lessee,as thecasemay be,so longas theinsurance isnotinvalidated thereby.
8.7 Indemnity. Except forLessor's grossnegligenceor willfulmisconduct, Lesseeshallindemnify,protect,defend andholdharmless thePremises, Lessorand itsagents, Lessor'smaster orgroundlessor,partnersand Lenders,from andagainstany andall claims,lossof rentsand/or damages,liens,judgments, penalƟes, aƩorneys'and consultants'fees, expensesand/or liabiliƟes arisingout of,involving, orinconnecƟon with,a Breachofthe Leaseby Lesseeand/orthe useand/or occupancyof thePremises and/orProjectby Lesseeand/or byLessee's employees,contractorsor invitees. Ifany acƟon orproceeding isbroughtagainst Lessorby reasonof anyof theforegoing maƩers, Lesseeshall upon noƟce defendthesame atLessee's expensebycounsel reasonably saƟsfactory toLessorand Lessorshall cooperatewith Lesseein suchdefense. Lessorneed nothave firstpaidany suchclaim inorderto bedefended or indemnified.
8.8 ExempƟon ofLessor andits AgentsfromLiability. Notwithstanding thenegligenceor breachof thisLeaseby Lessoror itsagents, neitherLessornor its agentsshall beliable underanycircumstances for:(i) injuryor damagetothe personor goods,wares,merchandise orother propertyofLessee, Lessee'semployees, contractors,invitees, customers,or anyotherperson inor aboutthe Premises,fromany cause,(ii) anydamagesarising fromany actorneglect ofany othertenant of Lessoror fromthe failureofLessor orits agentsto enforcetheprovisions ofany otherleasein theProject, or(iii)injury toLessee's businessor foranyloss ofincome or profit therefrom. Instead,itis intendedthat Lessee'ssole recourseinthe eventof suchdamagesor injurybe to filea claimon theinsurance policy(ies)thatLessee isrequired tomaintain pursuanttothe provisionsof paragraph8.
8.9 Failure toProvide Insurance.FailuretoProvideInsurance.Lesseeacknowledgesthatanyfailureonits parttoobtainormaintaintheinsurancerequiredhereinwillexposeLessortorisksandpotentially causeLessortoincurcostsnotcontemplatedbythisLease.LesseeshalldefendandindemnifyLessor fromandagainstsuchrisksasprovidedinParagraph8.7. Lesseeacknowledges thatanyfailure onits parttoobtain ormaintain theinsurance requiredherein willexposeLessor torisks and potenƟally causeLessorto incurcosts notcontemplatedby thisLease, theextentof whichwill be extremely difficult toascertain. Accordingly,for anymonth or porƟon thereofthatLessee doesnot maintaintherequired insuranceand/or doesnotprovide Lessor withthe requiredbinders or cerƟficatesevidencing theexistence ofthe requiredinsurance,the BaseRent shallbe automaƟcally increased,without anyrequirement for noƟce toLessee, byanamount equalto 10%of thethen exisƟng BaseRent or$100,whichever isgreater. The parƟes agreethat suchincrease inBaseRent representsfair andreasonable compensaƟonforthe addiƟonalrisk/costs thatLessor willincurby reasonof Lessee'sfailureto maintainthe requiredinsurance. Such increasein BaseRent shallinno event consƟtute awaiver ofLessee'sDefault orBreach withrespectto thefailure tomaintainsuch insurance,prevent theexercise of anyof theother rightsandremedies grantedhereunder,norrelieve Lesseeofits obligaƟonto maintaintheinsurance specifiedin thisLease.
9. SeeAddendum Damageor DestrucƟon.
9.1 Insured Loss. Ifthe improvementsonthe Premisesare damagedandsuch damageis anInsuredLoss, thenLessor shall,at Lessor'sexpense,repair such damage(but notLessee's TradeFixturesor LesseeOwned AlteraƟonsand UƟlity InstallaƟons)as soonas reasonablypossibleand thisLease shall conƟnuein fullforce and effect; provided,however,thatLesseeshall, atLessor's elecƟon,make therepairof anydamage or destrucƟonthe totalcost torepairof whichis $10,000or less, and,in suchevent, Lessorshallmake anyapplicable insuranceproceeds availabletoLessee ona reasonablebasisfor thatpurpose. Notwithstandingthe foregoing,if therequired insurancewas notinforce orthe insuranceproceeds arenot sufficient to effect suchrepair,the InsuringParty shallpromptlycontribute theshortage in proceeds(except asto the deducƟblewhich isLessee's responsibility)as andwhenrequired tocomplete saidrepairs. In theevent,however,suchshortage wasdue tothe factthat, byreasonof theunique natureof theimprovements,full replacementcost insurancecoveragewas notcommercially reasonableandavailable, Lessor shallhave no obligaƟon topayfor theshortage ininsurance proceedsorto fullyrestore theuniqueaspects ofthe Premises.
9.2 Uninsured Loss. Ifthe improvementsonthe Premisesare damagedandsuch damageis notanInsured Loss,unless causedby anegligentor willfulact of Lessee(in whichevent Lesseeshallmake therepairs atLessee's expense),Lessormay either: (i)repairsuch damageas soonasreasonably possibleat Lessor's expense,in whichevent thisLeaseshall conƟnuein fullforce and effect,or (ii)terminate thisLeaseby giving wriƩen noƟcetoLessee within30 days aŌer receiptby Lessorof knowledgeof theoccurrenceof suchdamage. Such terminaƟonshallbe effecƟve60 daysfollowingthe dateof such noƟce.
9.3 AbatementofRent; Lessee'sRemedies.
(a) Abatement. In theeventthe improvementson thePremises aredamagedor aHazardous Substance CondiƟonfor whichLessee isnotresponsible underthis Leaseoccurs ('HazardousSubstance CondiƟon' shallmean theoccurrence ordiscoveryof a condiƟon involvingthepresence of,or a contaminaƟonby,a HazardousSubstance onor underthePremises whichrequires remediaƟon),the Rentpayableby Lesseefor theperiodrequired forthe repair, remediaƟonor restoraƟonof suchdamage shallbeabated in proporƟon tothe degreetowhich Lessee'suse ofthePremises isimpaired, butnotto exceedthe proceedsreceived fromthe RentalValueinsurance. All other obligaƟons ofLessee hereundershallbe performedby Lessee,andLessor shallhave noliabilityfor anysuch damage, destrucƟon, remediaƟon, repairor restoraƟonexceptas providedherein. (b) Remedies. IfLessor isobligatedto repairor restorethePremises anddoes notcommence, ina substanƟal andmeaningful way,suchrepair or restoraƟonwithin 90days aŌersuch obligaƟon shallaccrue, Lesseemay,atany Ɵme priorto thecommencementof suchrepair or restoraƟon,give wriƩen noƟce to Lessorand toany Lendersofwhich Lesseehas actual noƟce, ofLessee's elecƟon toterminate thisLeaseon adate notlessthan 60days followingthe givingofsuch noƟce. IfLessee givessuch noƟce andsuch repairor restoraƟonisnot commencedwithin 30days thereaŌer ,thisLease shallterminateas ofthe date specified insaid noƟce. Ifthe repairor restoraƟoniscommenced withinsuch 30days,this Leaseshall conƟnueinfull forceand effect. "Commence" shallmean eitherthe uncondiƟonal authorizaƟon ofthe preparaƟonofthe requiredplans, orthe beginningofthe actualwork onthePremises, whichever first occurs.
9.4 TerminaƟon;AdvancePayments. Upon terminaƟonofthis Leasepursuant toParagraph 6.2(g)orParagraph9,an equitableadjustmentshall bemade concerningadvance BaseRent andanyother advancepayments madeby LesseetoLessor. Lessor shall,in addiƟon, returnto Lesseesomuch ofLessee's Security Depositas hasnot been,oris notthen requiredto be,usedby Lessor.
9.5 Waive Statutes. Lessorand Lesseeagreethat theterms ofthisLease shallgovern the effectof anydamage toor destrucƟonofthe Premiseswith respect tothe terminaƟonof thisLeaseand herebywaive theprovisions ofanypresent orfuture statutetothe extentinconsistent herewith.
10. Real PropertyTaxes.
10.1 DefiniƟon. Asused herein,the term"RealProperty Taxes"shall includeanyform ofassessment; realestate,general, special,ordinary orextraordinary,or rentallevy ortax (otherthaninheritance, personalincome orestatetaxes);improvementbond; and/orlicense feeimposedupon orlevied againstanylegal or equitableinterest ofLessor inthePremises orthe Project,Lessor's righttoother incometherefrom, and/orLessor'sbusiness ofleasing, byanyauthority havingthe director indirectpower totaxand wherethe fundsare generatedwithreference tothe Buildingaddress. RealProperty Taxesshallalso includeany tax,fee, levy, assessmentor charge,or anyincreasetherein: (i)imposed byreason ofeventsoccurring duringthe termofthis Lease,including butnotlimited to,a changein the ownershipof thePremises, and(ii)levied orassessed onmachinery orequipmentprovided byLessor toLesseepursuant tothis Lease.
10.2 Payment ofTaxes. Lessorshall paytheReal PropertyTaxesapplicabletothe Premisesinthefollowingmanner: provided,however,that Lesseeshall payto Lessortheamount, ifany,bywhich RealPropertyTaxesapplicableto thePremisesincrease overthe fiscaltaxyear duringwhich the CommencementDate Occurs("TaxIncrease"). Paymentof anysuch TaxIncrease shallbemade byLessee toLessor within30days aŌerreceipt ofLessor's wriƩen statement seƫng forththe amountdueand computaƟonthereof. If anysuchtaxes shallcover anyperiodof Ɵmeprior toor aŌer the expiraƟon or terminaƟon ofthis Lease,Lessee's shareof suchtaxesshall beprorated tocover onlythat porƟon ofthe taxbillapplicable tothe periodthatthis Leaseis in effect. Inthe eventlessee incursa latecharge onanyRentpayment,Lessor may esƟmate thecurrentReal PropertyTaxes,andrequirethat theTaxIncreasebe paidinadvance toLessor by Lesseemonthly inadvance withthepayment ofthe BaseRent. Suchmonthly paymentshall beanamount equalto theamountof the esƟmated installmentof the TaxIncreasedividedby thenumber ofmonthsremaining beforethe monthin whichsaidinstallment becomesdelinquent. Whenthe actualamount oftheapplicable TaxIncreaseisknown, theamount ofsuchequal monthlyadvance paymentsshall beadjustedas requiredto providethefunds neededto paytheapplicable Tax Increase. Ifthe amountcollected byLessoris insufficientto paytheTaxIncreasewhen due,Lessee shallpay Lessor,upondemand, such addiƟonal sumsasare necessaryto paysuch obligaƟons. Advance paymentsmay beintermingled withothermoneys ofLessor andshallnot bearinterest. In theeventof aBreach by Lesseein theperformance ofits obligaƟons underthis Lease,then anysuchadvance paymentsmay betreatedby Lessoras an addiƟonalSecurity Deposit.
10.3 AddiƟonalImprovements. Notwithstanding anythingtothe contraryin thisParagraph10.2,Lesseeshall payto Lessorupondemand thereforthe enƟrety of anyincreasein RealProperty Taxesassessedby reasonof AlteraƟonsor UƟlity InstallaƟonsplaced uponthe PremisesbyLessee orat Lessee'srequestor byreason ofany alteraƟonsor improvementstothe Premisesmade byLessor subsequenttothe execuƟonof thisLeaseby the ParƟes.
10.4 Joint Assessment. If thePremises arenotseparately assessed,Lessee's liabilityshall beanequitable proporƟonof theTaxIncrease forall oftheland and improvementsincluded withinthe taxparcelassessed, such proporƟon tobe conclusivelydeterminedby Lessorfrom the respecƟve valuaƟons assignedin the assessor'swork sheetsor suchother informaƟon asmay bereasonably available.
10.5 PersonalProperty Taxes. Lesseeshallpay,priorto delinquency,all taxesassessedagainst andlevied uponLesseeOwned AlteraƟons, UƟlity InstallaƟons, TradeFixtures, furnishings,equipment andallpersonal propertyof Lessee. Whenpossible,Lessee shallcause itsLesseeOwned AlteraƟonsand UƟlity InstallaƟons, TradeFixtures, furnishings,equipment andallother personalproperty tobe assessedandbilled separatelyfrom therealproperty ofLessor. Ifany ofLessee's said propertyshall beassessed withLessor'sreal property,Lessee shallpay Lessorthetaxes aƩributableto Lessee'spropertywithin 10days aŌerreceiptof a wriƩen statement seƫng forththe taxesapplicableto Lessee'sproperty.
11. UƟliƟes andServices.
11.1 Lessee shallpayfor allwater,gas,heat,light, power,telephone, trashdisposaland other uƟliƟes andservicessupplied tothe Premises,together withany taxesthereon. If anysuchservices arenot separatelymetered orbilledto Lessee,Lessee shallpaya reasonable proporƟon, tobedetermined byLessor,ofall charges jointlymetered orbilled. Thereshall beno abatementof rentandLessor shallnot beliablein anyrespect whatsoeverforthe inadequacy,stoppage, interrupƟonor disconƟnuanceof any uƟlity orservicedue toriot, strike,labor dispute,breakdown,accident, repairor othercausebeyond Lessor'sreasonable controlorin cooperaƟonwith governmentalrequest or direcƟons.
11.2 Within fiŌeendaysof Lessor's wriƩen request,Lesseeagrees todeliver toLessorsuch informaƟon,documents and/or authorizaƟonas Lessorneeds in orderfor Lessorto complywithnew or exisƟng ApplicableRequirements relaƟngtocommercial buildingenergy usage, raƟngs,and/or the reporƟng thereof.
12. Assignment and Subleƫng.
12.1 Lessor's ConsentRequired.
(a) Lessee shallnot voluntarilyorby operaƟonof lawassign, transfer,mortgageor encumber(collecƟvely, "assignorassignment") orsublet allorany partof Lessee'sinterest inthisLease orin thePremises withoutLessor'sprior wriƩenconsent,whichLessormayprovideordenyinits soleandabsolutediscretion.
(b) UnlessLessee isa corporaƟonandits stockis publiclytradedon a naƟonal stockexchange, achangein thecontrol ofLesseeshall consƟtutean assignmentrequiring consent. Thetransfer,on a cumulaƟve basis,of 25%ormore ofthe voƟngcontrolof Lesseeshall consƟtuteachange incontrol forthis purpose.
Lessee’sagreementwithTouchstoneGolf,LLC,aDelawarelimitedliabilitycompany (“Touchstone”)(orotheroperator)fortheoperationofagolfcourseonthePremises,shallnotbe deemedanassignmentorsublease. IntheeventthatLesseeelectstoengageanotheroperatorto replaceTouchstone,LesseeshallprovidenoticetoLessorwithinten(10)businessdays. (c) Theinvolvement ofLessee oritsassets inany transacƟon,orseries of transacƟons (byway ofmerger,sale, acquisiƟon, financing, transfer,leveraged buyoutor otherwise), whether ornota formalassignment or hypothecaƟon ofthisLease orLessee's assetsoccurs,which resultsor willresultin a reducƟon ofthe NetWorthofLessee byanamount greaterthan 25%of suchNetWorth asit wasrepresentedat the Ɵme ofthe execuƟon ofthis Leaseor atthe Ɵme ofthe most recentassignment towhich Lessorhasconsented, oras itexists immediatelypriorto said transacƟon or transacƟons consƟtuƟng such reducƟon, whicheverwasor is greater,shall beconsidered anassignmentof thisLease towhich Lessormaywithhold itsconsent. "NetWorth ofLessee" shallmeanthe networth ofLessee (excludingany guarantors)established undergenerallyaccepted accounƟngprinciples. (d) Anassignment or subleƫng withoutconsentshall, atLessor's opƟon,bea Defaultcurable aŌer noƟce perParagraph13.1(d), ora non-curableBreach withoutthe necessityof any noƟceand graceperiod.IfLessorelectstotreatsuchunapprovedassignmentasa non-curableBreach,LessormayterminatethisLease. IfLessor electstotreat suchunapproved assignmentor subleƫng asa non-curableBreach, Lessormay either:(i)terminate thisLease, or(ii) upon30days wriƩennoƟce, increasethemonthly BaseRent to110%of theBase Rentthen in effect. Further,in theeventof suchBreach andrental adjustment,(i)the purchaseprice ofany opƟon topurchase thePremisesheld byLessee shallbe subjectto similaradjustment to110% oftheprice previouslyin effect,and (ii)all fixed andnon-fixed rentaladjustmentsscheduled duringthe remainderofthe Leaseterm shall beincreased to110% ofthescheduled adjustedrent.
(e) Lessee's remedyforany breachof Paragraph12.1 byLessorshall belimited tocompensatorydamages and/or injuncƟve relief. (f) Lessor mayreasonablywithhold consentto aproposedassignment or subleƫng ifLesseeis inDefault atthe Ɵmeconsentis requested. (g) Notwithstanding theforegoing, allowinga deminimis porƟon ofthe Premises,i.e.20 squarefeet orless,to beused bya thirdpartyvendor in connecƟonwith the installaƟon ofavending machineor payphoneshall not consƟtutea subleƫng.
12.2 Termsand CondiƟonsApplicable toAssignment and Subleƫng. (a) Regardless ofLessor's consent,noassignment or subleƫng shall: (i)be effecƟvewithoutthe express wriƩen assumpƟon bysuch assigneeor sublesseeof the obligaƟons ofLesseeunder thisLease, (ii)release Lesseeofany obligaƟonshereunder,or(iii)alter theprimary liabilityofLessee forthe paymentof Rentor forthe performanceofany other obligaƟons tobe performedbyLessee. (b) Lessormay acceptRent orperformanceof Lessee's obligaƟons fromanyperson otherthan Lesseepending approvalordisapproval ofan assignment.
Neithera delayin theapprovalor disapprovalof suchassignment northeacceptance ofRent orperformanceshall consƟtutea waiverorestoppel ofLessor's rightto exerciseits remediesfor Lessee'sDefaultor Breach.
(c) Lessor'sconsent toany assignmentor subleƫng shallnot consƟtutea consenttoany subsequentassignment or subleƫng. (d) Inthe eventof anyDefaultor Breachby Lessee,Lessormay proceeddirectly againstLessee, anyGuarantorsor anyoneelse responsibleforthe performanceof Lessee's obligaƟons underthisLease, includingany assigneeor sublessee, without first exhausƟngLessor's remediesagainstany otherperson or enƟtyresponsible thereforto Lessor,orany securityheld byLessor. (e) Each requestforconsent toan assignmentor subleƫngshallbe in wriƟng, accompaniedbyinformaƟon relevantto Lessor's determinaƟonas tothe financialand operaƟonalresponsibility andappropriatenessof theproposed assigneeor sublessee,includingbut notlimited totheintended useand/or required modificaƟonof thePremises, ifany,together witha feeof $500as consideraƟon forLessor's consideringandprocessing saidrequest. Lesseeagrees toprovide Lessor withsuch otheror addiƟonal informaƟonand/or documentaƟonas maybe reasonablyrequested.(See alsoParagraph36) (f) Any assigneeof,or sublesseeunder,thisLeaseshall, byreason of accepƟngsuch assignment,entering intosuch sublease,orentering intopossession ofthe Premisesor any porƟonthereof,bedeemed tohave assumedandagreed toconform andcomplywith eachand everyterm,covenant, condiƟonand obligaƟon hereinto beobserved orperformedby Lesseeduring theterm ofsaidassignment orsublease, otherthansuch obligaƟonsas arecontraryto orinconsistent with provisionsof anassignment orsubleaseto whichLessor has specifically consentedtoin wriƟng. (g) Lessor's consentto anyassignment or subleƫngshall nottransfer totheassignee orsublessee any OpƟongranted tothe originalLessee bythisLease unlesssuch transferis specificallyconsentedto byLessor in wriƟng. (SeeParagraph39.2)
12.3 AddiƟonal Termsand CondiƟons Applicableto Subleƫng. The followingterms and condiƟonsshall applyto any subleƫngby Lesseeof allor anypartof thePremises andshall bedeemedincluded inall subleasesunder thisLeasewhether ornot expresslyincorporatedtherein:
(a) Lessee herebyassigns andtransfersto Lessorall ofLessee's interestinall Rentpayable onanysublease, andLessor maycollectsuch Rentand apply sametoward Lessee's obligaƟons underthisLease; provided,however,that unƟl aBreachshall occurin theperformanceof Lessee's obligaƟons, Lesseemaycollect saidRent. In theeventthat theamount collectedby LessorexceedsLessee's thenoutstanding obligaƟonsanysuch excessshall berefundedto Lessee. Lessorshall not,by reasonof theforegoingor anyassignment ofsuch sublease,norby reasonof the collecƟonof Rent,be deemedliableto thesublessee forany failureofLessee toperform andcomply withanyof Lessee's obligaƟons tosuch sublessee. Lessee herebyirrevocably authorizesanddirects anysuch sublessee,uponreceipt ofa wriƩen noƟce fromLessor staƟngthata Breachexists inthe performanceofLessee's obligaƟonsunder thisLease,to payto LessorallRent dueand tobecome due underthe sublease. Sublesseeshallrely uponany such noƟce fromLessorand shallpay allRentsto Lessorwithout any obligaƟonor rightto inquireas towhether suchBreach exists,notwithstanding anyclaimfrom Lesseeto thecontrary. (b) Inthe eventof aBreachby Lessee,Lessor may,atits opƟon,require sublesseeto aƩorntoLessor,inwhich eventLessorshall undertakethe obligaƟonsof thesublessor undersuchsublease fromthe Ɵmeof theexerciseof said opƟon tothe expiraƟon ofsuch sublease;provided,however,Lessorshall notbe liablefor anyprepaid rentsorsecurity depositpaid bysuch sublesseetosuch sublessoror foranyprior Defaultsor Breachesofsuch sublessor. (c) Any maƩer requiringthe consentofthe sublessorunder asublease shallalsorequire theconsent ofLessor. (d) Nosublessee shallfurther assignorsublet allor anypartof thePremises withoutLessor's prior wriƩenconsent. (e) Lessor shalldelivera copyof any noƟce ofDefaultor Breachby Lesseetothe sublessee,who shallhavethe rightto curethe DefaultofLessee within thegrace period,if any, specifiedin such noƟce. The sublesseeshallhave aright ofreimbursementand offsetfrom andagainstLessee forany suchDefaults curedby thesublessee.
13. Default; Breach;Remedies.
13.1 Default; Breach. A "Default"is definedasa failureby theLesseeto complywith orperformany ofthe terms,covenants, condiƟonsorRules and RegulaƟonsunder thisLease. A"Breach" is defined asthe occurrenceofone ormore ofthefollowing Defaults,and thefailureof Lesseeto curesuch Defaultwithin anyapplicable graceperiod:
(a) The abandonmentof thePremises;the vacaƟngof thePremises priortothe expiraƟonor terminaƟonofthis Leasewithout providingacommercially reasonablelevel ofsecurity,orwherethe coverageof theproperty insurancedescribedin Paragraph8.3 isjeopardizedas aresult thereof,orwithout providing reasonableassurances tominimize potenƟalvandalism;or failureto deliverto Lessorexclusivepossession ofthe enƟrePremisesin accordanceherewith priortothe expiraƟonor terminaƟonof thisLease.
(b) Thefailure ofLessee tomakeany paymentof Rentorany SecurityDeposit requiredto bemadeby Lesseehereunder,whethertoLessor orto athird party,when due,to providereasonableevidence ofinsurance orsurety bond,orto fulfillany obligaƟonunderthis Leasewhich endangersorthreatens lifeor property,where suchfailure conƟnuesfora periodof 3business daysfollowing wriƩen noƟceto Lessee. THE ACCEPTANCEBY LESSOROFA PARTIALPAYMENTOF
RENTOR SECURITYDEPOSIT SHALLNOTCONSTITUTE AWAIVER OFANY OFLESSOR'SRIGHTS, INCLUDINGLESSOR'S RIGHTTORECOVER POSSESSIONOF THE PREMISES.
(c) Thefailure ofLessee toallowLessor and/orits agentsaccess tothePremises orthe commissionofwaste, actor acts consƟtuƟngpublic orprivate nuisance,and/or anillegal acƟvityonthe Premisesby Lessee,where such acƟons conƟnue fora periodof3 businessdays following wriƩen noƟce toLessee. In the eventthat Lesseecommits waste,anuisance oran illegal acƟvity asecond Ɵme then,the Lessormayelect totreat suchconductas anon-curable Breachrather thana Default.
(d) Thefailure byLessee toprovide(i) reasonable wriƩen evidenceofcompliance withApplicable Requirements,(ii) theservicecontracts, (iii)the rescissionof anunauthorized assignmentor subleƫng, (iv)an Estoppel CerƟficate or financialstatements, (v)a requested subordinaƟon,(vi) evidenceconcerning any guarantyand/or Guarantor,(vii) anydocumentrequested underParagraph 42,(viii) materialsafetydata sheets(MSDS), or(ix)any other documentaƟon or informaƟonwhich Lessormay reasonablyrequireof Lesseeunder theterms ofthisLease, whereany suchfailure conƟnues fora periodof10 daysfollowing wriƩen noƟceto Lessee.
(e) A DefaultbyLessee asto theterms, covenants, condiƟonsor provisionsof thisLease,or ofthe rulesadoptedunder Paragraph40 hereof,other than thosedescribed insubparagraphs 13.1(a),(b),(c) or(d), above,where suchDefault conƟnues fora periodof30 days aŌer wriƩen noƟce;provided, however,that if thenature ofLessee's Defaultissuch thatmore than30 daysarereasonably requiredfor itscure,then itshall notbedeemed tobe aBreach ifLesseecommences suchcure withinsaid 30dayperiod and thereaŌer diligentlyprosecutes suchcureto compleƟon. (f) The occurrenceofany ofthe followingevents: (i)the makingofany generalarrangement orassignment forthe benefit ofcreditors; (ii)becominga "debtor"as definedin 11U.S.C.§ 101or anysuccessor statutethereto(unless, inthe caseofa peƟƟon filed againstLessee,the sameis dismissedwithin 60days);(iii) theappointment ofa trusteeorreceiver totakepossessionof substanƟallyallof Lessee'sassets locatedatthe Premisesor ofLessee'sinterest inthis Lease,where possessionis notrestored toLesseewithin 30days; or(iv) the aƩachment, execuƟon orother judicialseizureof substanƟallyall ofLessee'sassets locatedat the Premisesor ofLessee's interestinthis Lease,where suchseizure isnotdischarged within30 days;provided,however,inthe eventthatany provisionof this subparagraphis contraryto anyapplicablelaw,suchprovision shallbe ofnoforce or effect, andnot affect thevalidity oftheremaining provisions. (g) The discoverythat any financial statementofLessee orof anyGuarantorgiven toLessor wasmateriallyfalse. (h) ThecessationoftheuseofthePremisesforgolfcourseoperationsorotherAgreedUsefor aperiodexceeding180consecutivedays. Iftheperformance ofLessee's obligaƟonsunderthis Leaseis guaranteed: (i) thedeath ofa Guarantor,(ii) the terminaƟon ofaGuarantor's liabilitywith respectto thisLeaseother thanin accordancewiththe termsof suchguaranty,(iii) aGuarantor's becominginsolvent orthe subjectofa bankruptcy filing, (iv)a Guarantor'srefusalto honorthe guaranty,or(v) aGuarantor's breachofits guaranty obligaƟon onan anƟcipatorybasis, andLessee's failure,within60 daysfollowing wriƩen noƟce ofanysuch event,to provide wriƩen alternaƟve assuranceor security,which,when coupledwith thethen exisƟngresourcesof Lessee,equals orexceeds thecombined financial resourcesof Lesseeandthe Guarantorsthat existedatthe Ɵmeof execuƟonof thisLease.
13.2 Remedies. IfLessee failsto performanyof its affirmaƟve duƟesor obligaƟons, within10 days aŌer wriƩen noƟce(or incase ofanemergency,without noƟce),Lessor may,at its opƟon,perform suchduty or obligaƟon onLessee'sbehalf,includingbut notlimitedto theobtaining ofreasonablyrequired bonds, insurancepolicies, orgovernmental licenses,permitsor approvals. Lesseeshall paytoLessor anamount equalto115% ofthe costsandexpenses incurredby Lessor insuch performanceupon receiptofan invoicetherefor. In theeventof aBreach, Lessormay,with orwithout further noƟceor demand,and without limiƟng Lessor inthe exerciseof anyrightor remedywhich Lessormay havebyreason ofsuch Breach:
(a) TerminateLessee'sright topossessionof thePremises byany lawfulmeans,in whichcase thisLeaseshall terminateand Lesseeshallimmediately surrenderpossession toLessor. In sucheventLessor shallbe enƟtledtorecover fromLessee: (i) theunpaidRent whichhad beenearnedat the Ɵme of terminaƟon; (ii)the worthat the Ɵmeof awardof theamount bywhichthe unpaidrent whichwouldhave beenearned aŌer terminaƟon unƟl the Ɵme ofaward exceedsthe amountof suchrental lossthatthe Lesseeproves couldhave beenreasonablyavoided; (iii)the worthatthe Ɵmeof awardofthe amountby whichthe unpaidrentfor thebalance ofthe term aŌerthe Ɵmeof awardexceedstheamountof suchrental lossthatthe Lesseeproves couldbereasonably avoided;and (iv)any otheramount necessaryto compensateLessor forallthe detrimentproximately causedby theLessee'sfailure toperform its obligaƟonsunder thisLease orwhichin theordinary courseof thingswould belikelyto resulttherefrom, includingbut notlimitedto thecost ofrecoveringpossession ofthe Premises,expensesof releƫng,including necessary renovaƟon and alteraƟon ofthePremises, reasonable aƩorneys' fees,and that porƟonof anyleasing commissionpaidby Lessorin connecƟonwiththis Leaseapplicable tothe unexpiredtermof thisLease. The worthatthe Ɵmeof awardofthe amountreferredtoinprovision (iii)of theimmediately preceding sentenceshall becomputed by discounƟngsuch amountat thediscount rateofthe FederalReserve Bankofthe Districtwithin whichthePremises arelocated atthe Ɵmeof awardplus onepercent. Effortsby Lessorto miƟgatedamagescaused byLessee's Breachofthis Leaseshall notwaiveLessor's rightto recoverany damagesto whichLessor isotherwise enƟtled. If terminaƟonof thisLease isobtainedthrough theprovisional remedyofunlawful detainer,Lessor shallhavethe rightto recover insuch proceedingany unpaidRentand damagesas arerecoverable therein,orLessor mayreserve therightto recoverall oranypart thereofin aseparate suit. If a noƟceand graceperiod requiredunderParagraph13.1was notpreviously given,a noƟce topay rentorquit, orto performorquit givento Lesseeunder theunlawful detainerstatute shallalso consƟtutethe noƟce requiredby Paragraph13.1. Insuch case,the applicablegraceperiod requiredby Paragraph13.1and theunlawful detainerstatute shallrun concurrently,andthe failureof Lesseeto curetheDefault withinthe greaterofthe twosuch graceperiodsshall consƟtuteboth anunlawful detainerand aBreach ofthisLease enƟtlingLessor tothe remediesprovidedfor inthis Leaseand/orby saidstatute. (b) ConƟnuethe Leaseand Lessee'srightto possessionand recovertheRent asit becomesdue, inwhichevent Lesseemay subletorassign, subjectonly toreasonable limitaƟons. Actsofmaintenance, effortsto relet,and/or theappointmentof areceiver toprotectthe Lessor'sinterests, shallnot consƟtute a terminaƟonof theLessee's righttopossession.
(c) Pursueany otherremedy nowor hereaŌer availableunder thelaws orjudicialdecisions ofthe statewhereinthe Premisesare located. The expiraƟon or terminaƟon ofthis Leaseand/orthe terminaƟonof Lessee'sright topossessionshall notrelieve Lesseefromliability underany indemnityprovisionsof thisLease asto maƩersoccurring oraccruingduring theterm hereofor byreasonof Lessee'soccupancy ofthePremises.
13.3 Inducement Recapture. Any agreementfor freeorabated rentor othercharges, thecostof tenantimprovements forLesseepaid foror performedby Lessor,or forthe givingorpaying byLessor toor forLesseeof anycash orotherbonus, inducementor consideraƟonforLessee's enteringinto thisLease, allofwhich concessionsare hereinaŌerreferredtoas"Inducement Provisions,"shall bedeemed condiƟoneduponLessee's fulland faithfulperformanceof allof theterms, covenantsand condiƟonsof thisLease. UponBreach ofthis LeasebyLessee, anysuch InducementProvisionshall automaƟcallybe deemeddeletedfrom thisLease andof nofurther forceor effect, andany rent,other charge,bonus,inducement or consideraƟon theretoforeabated,given orpaid byLessorunder suchan InducementProvision shallbe immediatelydueand payableby Lesseeto Lessor,notwithstandingany subsequentcure ofsaidBreach byLessee. Theacceptance by Lessorof rentor thecureof theBreach which iniƟated the operaƟonof thisparagraph shallnotbe deemeda waiverbyLessor ofthe provisionsof thisparagraph unless specifically sostated in wriƟngby Lessorat the Ɵme ofsuchacceptance.
13.4 LateCharges. Lessee herebyacknowledgesthat latepayment byLessee ofRentwill causeLessor toincurcosts notcontemplated bythisLease, theexact amountof whichwill beextremely difficult toascertain. Such costsinclude,but arenot limitedto,processing and accounƟng charges,andlate chargeswhich maybe imposedupon Lessorby anyLender. Accordingly,if anyRent shallnotbe receivedby Lessorwithin5 days aŌer suchamountshall bedue, then,without any requirementfor noƟceto Lessee,Lesseeshall immediatelypay toLessor aone-Ɵmelate chargeequal to10%of eachsuch overdueamountor $100,whichever is greater. The ParƟes herebyagreethat suchlate chargerepresents afairand reasonable esƟmate ofthecosts Lessorwill incurbyreason ofsuch latepayment.
Acceptanceof suchlate chargebyLessor shallin noevent consƟtuteawaiver ofLessee's DefaultorBreach withrespect tosuchoverdue amount,nor preventthe exerciseof anyof theotherrights andremedies grantedhereunder. Inthe eventthat alatecharge ispayable hereunder,whetheror notcollected, for3 consecuƟve installmentsof BaseRent, thennotwithstandingany provisionof thisLease tothecontrary,BaseRent shall,atLessor's opƟon,become dueandpayable quarterlyin advance.
13.5 Interest. Anymonetary paymentdue Lessorhereunder,other thanlate charges,notreceived byLessor,whendueshall bearinterest fromthe 31stday aŌerit wasdue. Theinterest ("Interest")charged shallbe computedatthe rateof 10%perannum butshall notexceedthe maximumrate allowedby law. Interest is payablein addiƟonto the potenƟallate chargeprovided forin Paragraph13.4.
13.6 Breach byLessor.
(a) NoƟce ofBreach. Lessorshall notbe deemedin breachofthis Leaseunless Lessorfailswithin areasonable Ɵmetoperform an obligaƟon requiredto beperformed byLessor. Forpurposes ofthis Paragraph,a reasonable Ɵmeshall inno eventbeless than30 days aŌerreceipt byLessor,andany Lenderwhosename andaddress shallhave beenfurnishedto Lesseein wriƟngfor suchpurpose,of wriƩen noƟce specifyingwhereinsuch obligaƟonof Lessorhasnot beenperformed; provided,however,thatif thenatureof Lessor's obligaƟon issuch thatmorethan 30days arereasonablyrequired forits performance,thenLessor shallnot bein breachif performanceis commencedwithinsuch 30day periodand thereaŌerdiligentlypursued tocompleƟon. (b) Performanceby Lesseeon BehalfofLessor. In theeventthat neitherLessor norLender curessaidbreach within30 days aŌerreceipt ofsaid noƟce, orif havingcommenced saidcurethey donot diligentlypursue itto compleƟon, thenLessee mayelectto curesaid breachatLessee's expenseand offsetfrom Rent theactual andreasonable costtoperform suchcure, providedhowever,thatsuch offset shallnot exceedanamount equalto thegreaterof onemonth's BaseRent or theSecurity Deposit,reserving Lessee'srightto seekreimbursement fromLessor foranysuch expensein excessofsuch offset. Lesseeshalldocument thecost ofsaid cureand supplysaid documentaƟontoLessor.
14. CondemnaƟon. If thePremisesor any porƟon thereofaretakenunderthe powerof eminentdomainor soldunder thethreatof theexercise ofsaidpower (collecƟvely"CondemnaƟon"), thisLease shallterminateas tothe parttakenasofthe datethe condemningauthoritytakes Ɵtleor possession,whichever first occurs.
Ifmore than25% ofthePremises, istakenby CondemnaƟon, Lesseemay,at Lessee's opƟon, tobeexercisedin wriƟng within10days aŌerLessor shallhave given Lessee wriƩen noƟceof suchtaking(or inthe absenceof such noƟce,within 10days aŌerthecondemning authorityshall havetakenpossession) terminatethis Lease asof thedate thecondemningauthority takessuch possession. IfLesseedoes notterminate thisLeasein accordancewith theforegoing,this Leaseshall remainin fullforce and effect astothe porƟonof thePremises remaining,exceptthat theBase Rentshallbe reducedin proporƟontothe reducƟonin uƟlityof thePremises causedby such CondemnaƟon. CondemnaƟonawards and/orpayments shallbe thepropertyof Lessor,whether suchawardshall bemade as compensaƟonfor diminuƟonin valueof theleasehold,the valueof thepart taken,orfor severancedamages; provided,however,that Lesseeshall be enƟtledto any compensaƟon paid bythe condemnorfor Lessee's relocaƟonexpenses, lossof businessgoodwill and/orTradeFixtures, withoutregard towhetheror notthis Leaseisterminated pursuantto theprovisions ofthisParagraph. All AlteraƟonsand UƟlity InstallaƟonsmade tothe PremisesbyLessee, forpurposes of CondemnaƟononly,shallbe consideredthe propertyof theLesseeand Lesseeshall be enƟtled toanyand all compensaƟon whichispayable therefor. Intheevent thatthis Leaseis not terminatedby reasonof the CondemnaƟon,Lessor shallrepair anydamage tothePremises causedby such CondemnaƟon.
15. Brokerage Fees.
15.1 AddiƟonal Commission. In addiƟonto thepaymentsowed pursuantto Paragraph1.9 above,Lessoragrees that: (a)ifLessee exercisesany OpƟon,(b)if Lesseeor anyone affiliated withLesseeacquires anyrights tothe Premisesorother premisesowned byLessorand locatedwithin thesameProject, ifany,within whichthe Premisesis located,(c)if Lesseeremains inpossession ofthePremises, withthe consentofLessor, aŌerthe expiraƟonofthis Lease,or (d)if BaseRentis increased,whether byagreement or operaƟonof an escalaƟon clauseherein, then,Lessorshall payBrokersafeein accordancewith thefeeschedule ofthe Brokersin effectat the Ɵme theLeasewas executed. Theprovisions ofthisparagraph areintended tosupersedethe provisionsof anyearlieragreement tothe contrary.
15.2 AssumpƟon of ObligaƟons. Anybuyer ortransfereeof Lessor'sinterest inthisLease shallbe deemedtohave assumedLessor's obligaƟonhereunder.
Brokersshall bethird party beneficiariesof theprovisions ofParagraphs 1.9,15,22 and31.
15.3 RepresentaƟons and IndemniƟesof Broker RelaƟonships. Lesseeand Lessoreach representandwarrant tothe otherthatit hashad nodealings withany person, firm, broker,agent or finder (otherthanthe Brokersand Agents,ifany) in connecƟon withthis Lease,andthat noone otherthan saidnamedBrokersand Agents is enƟtledto anycommission or finder'sfeein connecƟon herewith. Lessee andLessor doeach herebyagreeto indemnify,protect, defendandhold theother harmlessfrom andagainst liabilityfor compensaƟon orcharges whichmay beclaimedby anysuch unnamedbroker,finder orother similarpartyby reasonof any dealingsor acƟonsof theindemnifyingParty,includingany costs,expenses, aƩorneys'feesreasonably incurredwith respectthereto.
16. Estoppel CerƟficates.
(a) Each Party(as "RespondingParty")shall within10 days aŌer wriƩen noƟcefrom theother Party(the"RequesƟng Party")execute, acknowledgeand deliverto the RequesƟng Partyastatement in wriƟng inform similartothe thenmost current"Estoppel CerƟficate" formpublished byAIRCRE, plussuch addiƟonal informaƟon, confirmaƟon and/orstatements asmaybe reasonablyrequested bythe RequesƟngParty. (b) Ifthe RespondingParty shallfailto executeor delivertheEstoppel CerƟficatewithin such10 dayperiod,the RequesƟngParty mayexecutean Estoppel CerƟficate staƟngthat: (i)theLease isin fullforce and effectwithout modificaƟonexcept asmaybe representedby the RequesƟngParty,(ii)there areno uncureddefaults inthe RequesƟngParty'sperformance, and(iii) ifLessor isthe RequesƟng Party,not morethanone month'srent hasbeenpaid inadvance.
ProspecƟvepurchasers andencumbrancers mayrelyupon the RequesƟng Party'sEstoppel CerƟficate,andthe RespondingParty shallbeestopped fromdenying the truthof thefacts containedinsaid CerƟficate. In addiƟon, Lesseeacknowledgesthat anyfailure onits parttoprovide suchan Estoppel CerƟficatewill exposeLessor torisks and potenƟally causeLessorto incurcosts notcontemplated bythisLease, theextent ofwhichwill beextremely difficulttoascertain. Accordingly,shouldthe Lesseefail toexecute and/ordelivera requestedEstoppel CerƟficatein a Ɵmelyfashion themonthly BaseRentshall be automaƟcally increased,withoutany requirementfor noƟceto Lessee,byan amountequal to10% ofthethen exisƟngBase Rentor$100, whicheveris greaterforremainder ofthe Lease. The ParƟes agreethat suchincrease inBaseRent representsfair andreasonable compensaƟonforthe addiƟonalrisk/costs thatLessorwill incurby reasonofLessee's failureto providethe Estoppel CerƟficate. Suchincrease inBase Rentshall innoevent consƟtutea waiverofLessee's Defaultor Breachwithrespect tothe failureto provide theEstoppel CerƟficatenor preventtheexercise ofany ofthe otherrightsand remediesgranted hereunder. (c) IfLessor desiresto finance, refinance,or sellthe Premises,or anypartthereof,Lesseeand allGuarantorsshall within10 days aŌer wriƩen noƟce fromLessor deliverto any potenƟallender orpurchaser designatedby Lessorsuch financial statementsas maybereasonably requiredby suchlenderor purchaser, includingbut notlimited toLessee's financial statementsfor thepast 3years. Allsuch financialstatementsshall bereceived byLessorand suchlender orpurchaser in confidenceand shallbe usedonlyfor thepurposes hereinset forth.
17. DefiniƟon ofLessor. Theterm "Lessor"as usedhereinshall meanthe owneror ownersatthe Ɵmein quesƟonofthe fee Ɵtle tothePremises, or,if thisis a sublease,of theLessee's interestinthe priorlease. In theeventof atransfer ofLessor's Ɵtle orinterest inthePremises orthis Lease,Lessor shalldeliverto the transfereeor assignee(in cashorby credit)any unusedSecurity Depositheldby Lessor. Uponsuchtransfer orassignment anddeliveryof theSecurity Deposit,as aforesaid,the priorLessor shallberelieved ofall liabilitywith respecttothe obligaƟonsand/or covenantsunderthis Lease thereaŌer tobeperformed bythe Lessor.
Subjectto theforegoing, the obligaƟonsand/or covenantsin thisLease tobeperformed bythe Lessorshallbe bindingonly upontheLessor ashereinabove defined.
18. Severability. The invalidityofany provisionof thisLease,as determinedby acourt ofcompetent jurisdicƟon, shallin noway affect thevalidity ofanyother provisionhereof.
19. Days. Unless otherwise specificallyindicated tothe contrary,theword "days"as usedin thisLeaseshall meanand refertocalendar days.
20. LimitaƟon onLiability. The obligaƟons ofLessor underthisLease shallnot consƟtutepersonal obligaƟonsofLessor,orits partners,members,directors, officers orshareholders, andLessee shalllookto thePremises, andto nootherassets ofLessor,forthe saƟsfacƟon ofany liabilityofLessor withrespect tothis Lease,and shallnot seekrecourse againstLessor'spartners, members,directors, officersor shareholders,orany oftheir personalassetsfor such saƟsfacƟon.
21. Time ofEssence. Timeis ofthe essencewithrespect tothe performanceof all obligaƟonsto beperformed orobservedby the ParƟes underthisLease.
22. No Prioror OtherAgreements;Broker Disclaimer. ThisLeasecontains allagreements betweenthe ParƟeswithrespect toany maƩer menƟonedherein, andno otherprior orcontemporaneous agreementorunderstanding shallbe effecƟve. LessorandLessee eachrepresents andwarrants totheBrokersthatit hasmade,and isrelying solelyupon, itsown invesƟgaƟon asto thenature, quality,characterand financialresponsibility oftheother Partyto thisLeaseand asto theuse, nature, qualityand characterof thePremises. Brokershave noresponsibility withrespectthereto orwith respectto anydefaultor breachhereof byeitherParty.
23. NoƟces.
23.1 NoƟce Requirements. All noƟcesrequired or permiƩedby thisLease orapplicablelaw shallbe in wriƟngand maybe deliveredin person(byhand orby courier)or maybe sentbyregular, cerƟfiedor registeredmail orU.S.PostalServiceExpress Mail,withpostage prepaid,or byfacsimiletransmission, orby email,and shallbe deemed sufficiently givenifserved ina manner specified inthisParagraph23. Theaddressesnoted adjacentto aParty'ssignature onthis Leaseshall bethat Party'saddress fordelivery ormailingof noƟces. EitherParty mayby wriƩen noƟceto theotherspecify a different addressfor noƟce, exceptthat uponLessee's takingpossession ofthe Premises,thePremises shall consƟtute Lessee'saddress for noƟce. Acopy ofall noƟces toLessor shallbeconcurrently transmiƩedto such partyor parƟesat suchaddressesas Lessormay from Ɵme to Ɵme hereaŌer designatein wriƟng.
23.2 Date of NoƟce. Any noƟce sentbyregistered or cerƟfied mail,returnreceipt requested,shall bedeemedgiven onthe dateof deliveryshownon the receiptcard, orif nodeliverydate isshown, thepostmark thereon. If sentby regularmailthe noƟceshall bedeemedgiven 72hours aŌerthe sameisaddressed as requiredherein andmailed withpostageprepaid. NoƟces deliveredby UnitedStatesExpress Mailor overnightcourierthat guaranteesnext daydeliveryshall be deemedgiven 24hours aŌerdeliveryof thesame tothe PostalServiceor courier. NoƟcesdeliveredby hand,or transmiƩedbyfacsimile transmissionor byemail shallbe deemeddelivered uponactualreceipt. If noƟceis receivedona Saturday,Sunday orlegalholiday,itshall bedeemedreceived onthe nextbusiness day.
23.3 OpƟons. Notwithstandingthe foregoing,in ordertoexercise any OpƟons (seeparagraph39), the NoƟce mustbesent by CerƟfied Mail(return receipt requested),Express Mail(signature required),courier(signature required)or someother methodologythatprovides areceipt establishingthedate the noƟce was receivedby theLessor.
24. Waivers.
(a) No waiverby Lessorofthe Defaultor Breachof anyterm,covenant or condiƟon hereofbyLessee, shallbe deemedawaiver ofany otherterm, covenantor condiƟonhereof,orofany subsequentDefault orBreach byLesseeof thesame orofany otherterm, covenantor condiƟon hereof. Lessor'sconsent to, orapproval of,any actshallnot bedeemed torender unnecessarytheobtaining ofLessor's consentto,or approvalof,anysubsequentor similaract byLessee, orbe construedas thebasis ofanestoppel toenforce theprovision orprovisionsof thisLease requiringsuchconsent. (b) Theacceptance ofRent byLessorshall notbe awaiverof anyDefault orBreach byLessee. Anypayment byLesseemay beaccepted byLessoron accountof moniesor damagesdueLessor,notwithstandingany qualifyingstatements or condiƟonsmade byLessee in connecƟontherewith, whichsuch statements and/or condiƟons shallbe ofnoforce or effect whatsoeverunless specificallyagreedto in wriƟng byLessorat orbefore the Ɵmeof depositof suchpayment. (c) THEPARTIESAGREETHATTHETERMSOF THISLEASE SHALLGOVERN WITHREGARDTOALLMATTERS RELATEDTHERETOAND HEREBYWAIVE THE PROVISIONSOF ANYPRESENT ORFUTURESTATUTETOTHE EXTENTTHATSUCHSTATUTEIS INCONSISTENTWITH THISLEASE.
25. Disclosures RegardingThe Natureofa RealEstate Agency RelaƟonship. (a) When enteringinto adiscussionwith areal estateagent regardingareal estate transacƟon, aLessoror Lesseeshould fromtheoutset understand whattype ofagency relaƟonshipor representaƟon ithas withthe agentoragents inthe transacƟon. Lessor andLessee acknowledgebeingadvised bythe Brokersin this transacƟon, asfollows:
(i) Lessor'sAgent. A Lessor'sagent undera lisƟng agreementwith theLessoracts asthe agentforthe Lessoronly. A Lessor'sagentor subagent hasthe following affirmaƟve obligaƟons: TotheLessor: A fiduciarydutyof utmostcare, integrity,honesty,and loyaltyin dealingswiththe Lessor. Tothe Lesseeand theLessor: (a) Diligentexerciseof reasonableskills andcare inperformanceof theagent's duƟes. (b) Aduty ofhonestand fairdealing andgood faith. (c) Aduty to discloseall factsknown totheagent materially affecƟng thevalue ordesirabilityof theproperty thatarenot knownto,orwithinthe diligent aƩenƟon and observaƟonof,the ParƟes. Anagent isnot obligatedto revealtoeither Partyany confidenƟal informaƟonobtained fromthe otherPartywhich doesnot involvethe affirmaƟve duƟes setforth above.
(ii) Lessee'sAgent. Anagent canagree toactas agentfor theLesseeonly. In these situaƟons,the agentis notthe Lessor'sagent,even ifby agreementthe agentmay receive compensaƟonfor servicesrendered, eitherin fullorin partfrom theLessor. Anagent acƟngonlyfor aLessee hasthe following affirmaƟve obligaƟons. TotheLessee: A fiduciary dutyof utmostcare,integrity,honesty,and loyaltyindealings withthe Lessee. TotheLessee andthe Lessor: (a) Diligentexercise ofreasonable skillsandcare inperformance ofthe agent's duƟes. (b)A dutyofhonest andfair dealingandgood faith. (c)A dutytodisclose allfacts knownto theagent materially affecƟngthe valueor desirabilityof thepropertythat arenot knownto,or withinthe diligent aƩenƟonand observaƟonof,the ParƟes.
Anagent isnot obligatedtoreveal toeither Partyany confidenƟal informaƟonobtained fromthe otherPartywhich doesnot involvethe affirmaƟve duƟesset forth above.
(iii) Agent RepresenƟngBothLessor andLessee. Areal estateagent, either acƟng directlyorthrough oneor moreassociatelicensees, canlegally be theagent ofboth theLessorand theLessee ina transacƟon,butonly withthe knowledgeandconsent ofboth theLessorand theLessee. In adualagency situaƟon, theagent hasthe following affirmaƟve obligaƟons toboth theLessor andtheLessee: (a)A fiduciarydutyof utmostcare, integrity,honestyand loyaltyin thedealings witheither Lessoror theLessee. (b)Other duƟesto theLessorand theLessee asstatedabove insubparagraphs (i)or(ii). In represenƟngboth LessorandLessee, the agentmay not,without theexpresspermission ofthe respecƟveParty,disclosetothe otherParty confidenƟal informaƟon,including, butnot limitedto,facts relaƟng toeither Lessee'sor Lessor's financial posiƟon, moƟvaƟons,bargaining posiƟon,or otherpersonal informaƟon thatmay impactrent,including Lessor'swillingness to accepta rentless thanthe lisƟng rentor Lessee'swillingness topayrent greaterthan therentoffered. The above duƟesof theagent ina realestate transacƟon do notrelieve aLessor orLesseefrom theresponsibility toprotect theirowninterests. Lessor andLesseeshould carefullyread allagreementsto assurethat they adequatelyexpress theirunderstanding ofthe transacƟon. A realestateagentisa person qualified toadviseabout realestate. Iflegal ortax adviceis desired,consult acompetent professional. BothLessorand Lesseeshould stronglyconsider obtainingtaxadvice froma competentprofessionalbecause thefederal andstatetax consequencesof a transacƟon canbecomplex andsubject tochange. (b) Brokershave noresponsibility withrespectto anydefault orbreachhereof byeither Party. The ParƟesagree thatno lawsuitorother legal proceedinginvolving anybreach ofduty,error oromission relaƟngto thisLeasemay bebrought againstBrokermore thanone year aŌerthe StartDate andthat the liability(including courtcosts and aƩorneys'fees), ofany Brokerwith respecttoany suchlawsuit and/orlegalproceeding shallnot exceedthefee receivedby such Brokerpursuant tothis Lease;provided,however,thatthe foregoing limitaƟon oneachBroker'sliabilityshall notbeapplicable toany grossnegligenceor willful misconductof suchBroker.
(c) Lessorand Lesseeagree to idenƟfyto Brokersas "ConfidenƟal"any communicaƟonor informaƟon givenBrokersthatisconsidered bysuch Partyto be confidenƟal.
26. No RightToHoldover. Lessee hasno righttoretain possessionof thePremises oranypart thereofbeyond the expiraƟonor terminaƟonof thisLease. Ator priorto the expiraƟon or terminaƟonof thisLease Lesseeshall deliverexclusivepossession ofthe PremisestoLessor. For purposesofthis provisionand Paragraph
13.1(a),exclusive possessionshall meanthatLessee shallhave vacatedthe Premises,removedall ofits personalpropertytherefrom andthat thePremiseshave been returnedin the condiƟon specifiedinthis Lease. Inthe eventthatLessee doesnot deliverexclusive possessiontoLessor as specified above,thenLessor's damages duringany holdoverperiod shallbecomputed atthe amountof theRent(as definedin Paragraph4.1)due duringthe lastfullmonth beforethe expiraƟonor terminaƟonof thisLease (disregardinganytemporary abatementof Rentthat mayhavebeen in effect), butwithBase Rentbeing 150%ofthe BaseRent payable duringsuch lastfull month. Nothingcontainedherein shallbe construedasconsent byLessor toany holdingoverby Lessee.
27. CumulaƟve Remedies. Noremedyor elecƟonhereunder shallbedeemed exclusivebut shall,wherever possible,be cumulaƟve withall otherremediesat lawor inequity.
28. Covenants and CondiƟons; ConstrucƟonofAgreement. All provisionsofthis Leaseto beobserved orperformedby Lesseeare bothcovenantsand condiƟons.
Inconstruing thisLease, allheadingsand Ɵtlesare forthe convenienceofthe ParƟesonly andshallnot beconsidered apartof thisLease. Whenever requiredbythe context,the singularshall includetheplural andvice versa. ThisLeaseshall notbe construedasif preparedby oneofthe ParƟes,but ratheraccording toitsfair meaningas awhole, asifboth ParƟeshad preparedit.
29. Binding Effect;Choice ofLaw. ThisLease shallbebinding uponthe ParƟes,their personalrepresentaƟves,successors andassigns andbegoverned bythe laws ofthe Statein whichthePremises arelocated. Any liƟgaƟonbetweenthe ParƟeshereto concerningthisLease shallbe iniƟatedinthe countyin whichthe Premises arelocated. Signatures tothisLease accomplishedby meansof electronicsignatureor similartechnology shallbelegal andbinding.
30. SubordinaƟon; AƩornment;Non-Disturbance.
30.1 SubordinaƟon. ThisLease andany OpƟongrantedhereby shallbe subjectandsubordinate toany groundlease,mortgage, deedof trust,or other hypothecaƟonor securitydevice (collecƟvely,"SecurityDevice"), nowor hereaŌerplaced uponthePremises, toany andalladvances madeon thesecuritythereof, andto allrenewals, modificaƟons,andextensions thereof. Lesseeagrees thattheholders ofany suchSecurityDevices (inthis Leasetogetherreferredtoas "Lender") shallhave noliability or obligaƟonto performany ofthe obligaƟonsofLessor underthis Lease. Any Lendermay electtohave thisLease and/orany OpƟongranted herebysuperior tothe lienofits SecurityDevice bygiving wriƩen noƟcethereof toLessee, whereuponthisLease andsuch OpƟonsshallbe deemedprior tosuch SecurityDevice, notwithstandingthe relaƟvedatesof the documentaƟon or recordaƟon thereof.
30.2 AƩornment. Inthe eventthat Lessortransfers Ɵtle tothe Premises,orthe Premisesare acquiredbyanother uponthe foreclosureor terminaƟonofa SecurityDevice towhich thisLeaseis subordinated(i) Lesseeshall, subjecttothe non-disturbanceprovisions ofParagraph30.3, aƩornto suchnewowner,andupon request,enter intoa newlease,containing allof theterms andprovisionsof thisLease, withsuchnew ownerfor theremainderof theterm hereof,or,atthe elecƟon ofthe newowner,thisLeasewill automaƟcallybecome anew leasebetweenLessee andsuch newowner,and (ii)Lessor shall thereaŌerbe relievedof anyfurther obligaƟonshereunder andsuch newownershall assumeall ofLessor's obligaƟons,exceptthat suchnew ownershallnot: (a)be liableforany actor omissionof any priorlessor orwith respecttoevents occurringprior to acquisiƟon ofownership;(b) besubject toany offsets ordefenses whichLesseemight haveagainst anyprior lessor, (c)be boundbyprepayment ofmore thanone month'srent,or (d)be liableforthe returnof anysecuritydeposit paidto anyprior lessorwhichwas notpaid or creditedto suchnew owner.
30.3 Non-Disturbance. Withrespect toSecurity Devicesenteredinto byLessor aŌerthe execuƟon ofthis Lease,Lessee's subordinaƟon ofthis Leaseshall be subjectto receivinga commerciallyreasonablenon-disturbance agreement(a "Non-DisturbanceAgreement") fromtheLender whichNon-Disturbance Agreement providesthat Lessee'spossession ofthePremises, andthis Lease,including any opƟonsto extendthe termhereof,will notbe disturbedsolong asLessee isnot in Breachhereof and aƩorns totherecord ownerof thePremises.
30.4 Self-ExecuƟng. Theagreements containedin thisParagraph30 shallbe effecƟvewithoutthe execuƟonof anyfurtherdocuments; provided,however,that, upon wriƩen requestfrom Lessorora Lenderin connecƟonwith asale, financing or refinancing ofthePremises, Lesseeand Lessorshallexecute suchfurther wriƟngs asmay bereasonably requiredtoseparately documentany subordinaƟon, aƩornment and/orNon-DisturbanceAgreement providedfor herein.
31. AƩorneys' Fees. IfanyParty orBrokerbringsan acƟon orproceeding involvingthe Premiseswhetherfounded intort, contractorequity,orto declarerights hereunder,the PrevailingParty (as hereaŌer defined) inany suchproceeding, acƟon,orappeal thereon,shall be enƟtledto reasonable aƩorneys' fees. Such feesmay beawarded inthe samesuitor recoveredin aseparate suit,whetheror notsuch acƟonorproceeding ispursued todecisionor judgment. Theterm, "Prevailing Party"shall include,without limitaƟon,aParty orBrokerwho substanƟally obtainsordefeats therelief sought,asthe casemay be,whetherby compromise, seƩlement,judgment, orthe abandonmentbythe otherParty orBroker ofitsclaim ordefense. The aƩorneys' feesaward shallnotbe computedin accordancewith anycourt feeschedule, butshallbe suchas tofully reimburseall aƩorneys' feesreasonably incurred. In addiƟon,Lessor shallbe enƟtled to aƩorneys' fees,costs and expensesincurred inthe preparaƟonandservice of noƟces ofDefault and consultaƟonsin connecƟontherewith, whetherornot alegal acƟonissubsequently commencedin connecƟonwith suchDefaultor resulƟngBreach ($200is areasonableminimum peroccurrence forsuchservices and consultaƟon).
32. Lessor's Access;Showing Premises;Repairs. Lessorand Lessor'sagentsshall havethe rightto enterthePremises atany Ɵme,inthe caseof anemergency,and otherwiseat reasonable Ɵmes aŌerreasonableprior noƟcefor thepurpose ofshowingthe sameto prospecƟvepurchasers,lenders, ortenants, andmakingsuch alteraƟons,repairs, improvementsor addiƟonstothe Premisesas Lessormay deemnecessaryor desirableand the erecƟng,using andmaintaining of uƟliƟes, services,pipes andconduits throughthePremises and/orother premisesas longasthere isno materialadverse effect onLessee's useofthe Premises. Allsuch acƟviƟesshall bewithout abatementofrent orliability toLessee.
33. AucƟons. Lessee shallnotconduct, norpermit tobeconducted, any aucƟon uponthe PremiseswithoutLessor's prior wriƩen consent. Lessor shallnot be obligatedto exerciseany standardofreasonableness indetermining whetherto permitan aucƟon.
34. Signs. Lessor mayplaceon thePremises ordinary"ForSale" signsat any Ɵme andordinary"For Lease"signs duringthelast 6months oftheterm hereof. Except forordinary "ForSublease" signs,Lesseeshall notplace anysign uponthePremises withoutLessor's prior wriƩenconsent. All signsmustcomply withall Applicable Requirements.
35. TerminaƟon; Merger. Unless specificallystated otherwisein wriƟngbyLessor,thevoluntary orother surrenderofthis Leaseby Lessee,themutual terminaƟon or cancellaƟon hereof,or a terminaƟonhereof byLessor forBreach byLessee,shall automaƟcallyterminate anysubleaseor lesserestate inthePremises; provided, however,that Lessormay electto conƟnue anyone orall exisƟngsubtenancies. Lessor'sfailure within10days followingany sucheventto electto thecontrary by wriƩen noƟce tothe holderofany suchlesser interest,shall consƟtuteLessor's elecƟon tohave suchevent consƟtute the terminaƟon ofsuchinterest.
36. Consents. All requestsforconsent shallbe in wriƟng. Exceptas otherwiseprovided herein,whereverin thisLease theconsentof aParty isrequiredto anact by orfor theother Party,suchconsent shallnot beunreasonably withheldordelayed. Lessor's actualreasonablecosts andexpenses (includingbutnot limitedto architects', aƩorneys', engineers'and otherconsultants'fees) incurredin the consideraƟon of,orresponse to,a requestbyLessee forany Lessorconsent,including butnot limitedto consentstoan assignment,a subleƫngor thepresenceor useof aHazardousSubstance, shallbe paidbyLessee uponreceipt ofan invoiceand supporƟng documentaƟon therefor. Lessor'sconsentto anyact, assignmentor subleƫngshallnot consƟtutean acknowledgmentthatno Defaultor BreachbyLessee ofthis Leaseexists, norshallsuch consentbe deemeda waiverofany then exisƟng DefaultorBreach, exceptas maybeotherwise specificallystated in wriƟng by Lessorat the Ɵme ofsuchconsent. The failureto specifyhereinany parƟcular condiƟon toLessor'sconsent shallnot precludethe imposiƟon byLessor atthe Ɵmeof consentof suchfurther orother condiƟons asare thenreasonable withreferenceto the parƟcular maƩerforwhich consentis beinggiven. Inthe eventthat either Partydisagrees withany determinaƟonmadeby theother hereunderand reasonablyrequeststhe reasonsfor such determinaƟon,the determiningparty shallfurnish itsreasons in wriƟng andinreasonable detailwithin 10business daysfollowingsuch request.
37. Guarantor.
37.1 ExecuƟon. TheGuarantors,ifany,shalleachexecute aguaranty intheform mostrecently publishedbyAIR CRE.
37.2 Default. Itshall consƟtutea Defaultofthe Lesseeif anyGuarantorfails orrefuses, uponrequestto provide: (a)evidence ofthe execuƟon ofthe guaranty, includingthe authorityof thepartysigning onGuarantor's behalfto obligateGuarantor,and inthe caseofa corporateGuarantor,a cerƟfiedcopy ofa resoluƟonof its boardof directorsauthorizing themakingof suchguaranty,(b)current financialstatements,(c) anEstoppel CerƟficate,or(d) wriƩen confirmaƟon thattheguaranty is sƟllin effect.
38. Quiet Possession. Subject topayment byLessee oftheRent andperformance ofallof thecovenants, condiƟonsandprovisions onLessee's partto beobserved andperformed underthis Lease,Lesseeshall havequiet possessionand quietenjoymentof thePremises duringtheterm hereof.
39. OpƟons. If Lesseeisgranted any OpƟon, as defined below,thenthe followingprovisions shallapply.
39.1 DefiniƟon. "OpƟon"shall mean: (a)theright toextend orreducethe termof orrenewthis Leaseor toextend orreducethe termof orrenewany lease thatLessee hason otherpropertyof Lessor;(b) theright of firstrefusal or first offertolease eitherthe Premisesorother propertyof Lessor;(c) therightto purchase, theright of first offertopurchase orthe rightof firstrefusalto purchasethe Premisesorother propertyof Lessor.
39.2 OpƟons PersonalToOriginal Lessee. Any OpƟongranted toLessee inthisLease ispersonal totheoriginal Lessee,and cannotbe assignedorexercisedby anyoneother thansaid originalLesseeand onlywhile theoriginal Lesseeisin fullpossession ofthePremises and,if requestedbyLessor,withLessee cerƟfyingthat Lesseehas no intenƟon of thereaŌerassigning or subleƫng.
39.3 MulƟple OpƟons. In theevent thatLesseehas any mulƟple OpƟonstoextend orrenew thisLease,a later OpƟon cannotbe exercisedunlessthe prior OpƟonshave beenvalidly exercised.
39.4 Effect ofDefaulton OpƟons.
(a) Lessee shallhave norightto exercisean OpƟon: (i)duringthe periodcommencing withthegiving ofany noƟceofDefault and conƟnuing unƟlsaid Defaultis cured,(ii) duringtheperiod of Ɵme anyRent isunpaid(without regardto whethernoƟcethereof isgiven Lessee),(iii)during the Ɵme Lesseeis inBreachof thisLease, or(iv) intheevent thatLessee hasbeen given3or more noƟces ofseparateDefault, whetheror nottheDefaults arecured, duringthe 12monthperiod immediatelypreceding theexercise ofthe OpƟon.
(b) Theperiod of Ɵme withinwhichan OpƟonmay beexercisedshall notbe extendedor enlargedbyreason ofLessee's inabilitytoexercise an OpƟon becauseof theprovisions ofParagraph39.4(a).
(c) An OpƟon shallterminate andbeof nofurther forceor effect,notwithstandingLessee's dueand Ɵmelyexerciseof the OpƟon, if, aŌersuch exercise andprior tothe commencement ofthe extendedterm or compleƟon ofthepurchase, (i)Lessee failstopay Rentfor aperiodof 30days aŌersuch Rentbecomesdue (withoutany necessityof Lessortogive noƟcethereof), or(ii) ifLesseecommits aBreach ofthisLease.
40. MulƟple ProperƟes. IfthePremises area partof agroupof properƟescontrolled byLessor,Lessee agreesthat itwillabide byand conformto allreasonable rulesand regulaƟonswhich Lessormaymake from Ɵme to Ɵme forthemanagement, safety,and careofsaid properƟes,including thecareand cleanlinessof the groundsand includingthe parking,loadingand unloadingof vehicles,and tocauseits employees,suppliers, shippers,customers,contractors andinvitees tosoabide andconform. Lessee alsoagreesto payits fairshare ofcommonexpenses incurredin connecƟonwithsuch rulesand regulaƟons.
41. Security Measures. Lesseeherebyacknowledges thatthe Rentpayableto Lessorhereunder doesnot includethecost ofguard serviceorother security measures,and thatLessor shallhaveno obligaƟonwhatsoever toprovide same. Lessee assumesall responsibility forthe protecƟonof thePremises,Lessee, its agentsand inviteesand theirpropertyfrom theacts ofthird parƟes.
42. ReservaƟons. Lessor reservestoitself theright, from Ɵmeto Ɵme,to grant,without theconsentor joinderof Lessee,sucheasements, rightsand dedicaƟons thatLessor deemsnecessary, andtocause the recordaƟon ofparcel mapsand restricƟons, solong assucheasements, rights, dedicaƟons, mapsand restricƟons do notunreasonably interferewith theuseof thePremises byLessee. Lesseeagrees tosign anydocumentsreasonably requestedby Lessorto effectuateanysuch easementrights, dedicaƟon,map or restricƟons.
43. Performance UnderProtest. Ifat any Ɵme adisputeshall ariseas toany amountorsum ofmoney tobepaid byone Partytothe otherunder theprovisions hereof,the Partyagainst whomthe obligaƟon topay themoney isassertedshall havethe righttomake payment"under protest"andsuch paymentshall notbe regardedas avoluntary paymentandthere shallsurvive theright onthepart ofsaid Partyto insƟtute suitfor recoveryofsuch sum. Ifit shallbeadjudged thatthere wasno legal obligaƟon onthepart ofsaid Partyto paysuchsum orany partthereof,said Partyshall be enƟtledto recoversuch sumor somuchthereof asit wasnot legallyrequired topay. AParty whodoes not iniƟate suitforthe recoveryof sumspaid"under protest"within 6monthsshall bedeemed tohave waiveditsright to protestsuch payment.
44. Authority; MulƟple ParƟes; ExecuƟon.
(a) If eitherParty heretoisa corporaƟon,trust, limitedliability company,partnership,or similar enƟty,eachindividual execuƟng thisLease onbehalfof such enƟty representsand warrantsthathe orshe isduly authorizedtoexecute anddeliver thisLeaseon itsbehalf. EachParty shall,within 30days aŌerrequest, deliverto theother Party saƟsfactoryevidence ofsuch authority. (b) Ifthis Leaseis executedbymore thanone personor enƟty as"Lessee", eachsuch personorenƟty shallbe jointlyandseverally liablehereunder. Itis agreedthat anyone ofthenamed Lesseesshall beempowered toexecuteany amendmentto thisLease,or otherdocument ancillarytheretoand bindall ofthe namedLessees, andLessor mayrelyon thesame asif allofthe namedLessees hadexecutedsuch document. (c) ThisLease maybe executedbythe ParƟesin counterparts,each ofwhichshall bedeemed anoriginaland allof whichtogethershall consƟtuteone andthe sameinstrument.
45. Conflict. Any conflictbetweenthe printedprovisions ofthisLease andthe typewriƩenor handwriƩenprovisionsshall becontrolled bythe typewriƩen or handwriƩenprovisions.
46. Offer. PreparaƟon ofthisLease byeither Partyortheir agentand submission of sametothe otherParty shallnotbe deemedan offertolease tothe other Party. ThisLease isnotintended tobe binding unƟl executedanddelivered byall ParƟeshereto.
47. Amendments. This Leasemaybe modifiedonly in wriƟng,signed bythe ParƟesin interestatthe Ɵmeof the modificaƟon. Aslong astheydo notmaterially changeLessee's obligaƟonshereunder,Lesseeagreesto makesuch reasonablenon-monetary modificaƟonstothis Leaseas maybereasonably requiredby aLender in connecƟon withthe obtainingofnormal financingor refinancingof thePremises.
48. Waiver ofJury Trial. THE PARTIESHEREBY WAIVETHEIRRESPECTIVE RIGHTSTOTRIALBYJURYINANY ACTIONOR PROCEEDINGINVOLVINGTHE PROPERTY ORARISING OUTOF THISAGREEMENT.
49. ArbitraƟon ofDisputes. AnAddendum requiringthe ArbitraƟonofall disputesbetween theParƟes and/orBrokersarising outof thisLease is isnot aƩachedto thisLease.
50. Accessibility; Americanswith DisabiliƟesAct.
(a) The Premises:
havenot undergonean inspecƟonbya CerƟfiedAccess Specialist(CASp). Note:A CerƟfiedAccess Specialist(CASp)can inspectthe subjectpremisesand determinewhether thesubject premisescomplywith allof theapplicable construcƟon-relatedaccessibilitystandards understate law.Althoughstate lawdoes not requirea CASp inspecƟon ofthesubject premises,the commercialproperty ownerorlessor maynot prohibitthelessee ortenant fromobtaininga CASp inspecƟon of thesubject premisesfor theoccupancyor potenƟaloccupancy ofthe lesseeortenant, ifrequested bythelessee ortenant. The parƟesshall mutuallyagree onthe arrangementsfor the Ɵme andmannerof theCASp inspecƟon,the paymentofthe feefor theCASpinspecƟon, andthe costofmaking anyrepairs necessaryto correct violaƟons of construcƟon-related accessibilitystandardswithin thepremises. haveundergone an inspecƟon bya CerƟfied AccessSpecialist (CASp)and itwasdetermined thatthe Premisesmetall applicable construcƟon-related accessibility standardspursuant toCalifornia CivilCode§55.51 etseq. Lessee acknowledgesthatit receiveda copyofthe inspecƟon report atleast48 hoursprior to execuƟng this Leaseand agreesto keepsuchreport confidenƟal.
haveundergone an inspecƟon bya CerƟfied AccessSpecialist (CASp)and itwasdetermined thatthe Premisesdidnot meetall applicable construcƟon-related accessibilitystandards pursuantto CaliforniaCivilCode §55.51et seq. Lesseeacknowledges thatit receivedacopy ofthe inspecƟonreportat least48 hoursprior to execuƟngthis Leaseand agreestokeep suchreport confidenƟalexcept asnecessaryto completerepairs and correcƟonsof violaƟonsof construcƟonrelated accessibilitystandards.
Inthe eventthat thePremiseshave beenissued an inspecƟon reportbya CASpthe Lessorshallprovide acopy ofthedisability access inspecƟon cerƟficateto Lessee within7 daysof the execuƟonof thisLease.
(b) Sincecompliance withthe Americanswith DisabiliƟes Act(ADA) andotherstate andlocal accessibilitystatutes aredependentupon Lessee's specific useof thePremises, Lessormakesno warrantyor representaƟonas towhetheror notthe Premisescomplywith ADAor anysimilar legislaƟon. In theevent that Lessee'suse ofthe Premisesrequires modificaƟons or addiƟons tothe Premisesinorder tobe incompliancewith ADAor otheraccessibilitystatutes, Lesseeagrees to makeany suchnecessary modificaƟonsand/or addiƟons atLessee's expense.
LESSORAND LESSEEHAVE CAREFULLYREADAND REVIEWEDTHIS LEASEAND EACHTERMAND PROVISIONCONTAINED HEREIN,ANDBYTHEEXECUTION OFTHIS LEASESHOW THEIRINFORMED ANDVOLUNTARYCONSENT THERETO. THEPARTIESHEREBYAGREETHAT,ATTHE TIMETHISLEASE ISEXECUTED, THETERMSOF THISLEASE ARECOMMERCIALLY REASONABLEANDEFFECTUATETHEINTENT ANDPURPOSE OFLESSORAND LESSEEWITH RESPECTTOTHE PREMISES.
ATTENTION: NOREPRESENTATIONORRECOMMENDATIONIS MADEBYAIRCRE ORBYANY BROKERAS TOTHELEGAL SUFFICIENCY,LEGAL EFFECT,ORTAX CONSEQUENCESOF THISLEASE ORTHETRANSACTION TOWHICH ITRELATES. THEPARTIESAREURGED TO:
1. SEEKADVICE OFCOUNSELAS TOTHE LEGALANDTAXCONSEQUENCESOF THISLEASE.
2. RETAINAPPROPRIATECONSULTANTSTOREVIEW ANDINVESTIGATETHECONDITIONOF THEPREMISES. SAID INVESTIGATIONSHOULDINCLUDE BUTNOT BE LIMITEDTO:THEPOSSIBLE PRESENCEOFHAZARDOUS SUBSTANCES,THE ZONINGOF THEPREMISES,THE CONDITIONAND THESUITABILITYOF THEPREMISES FOR LESSEE'SINTENDED USE.
WARNING: IFTHE PREMISESARELOCATEDINA STATEOTHER THANCALIFORNIA, CERTAINPROVISIONSOF THELEASEMAYNEEDTO BEREVISEDTOCOMPLYWITH THELAWS OFTHE STATEINWHICH THEPREMISES ARELOCATED.
The parƟes heretohave executedthisLease atthe placeand onthedates specifiedabove theirrespecƟvesignatures.
Executedat:
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ByLESSOR:
BLUE ROCK SPRINGS, LLC, a Delaware limited
liability company
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CITY OF VALLEJO, a municipal corporation
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AIRCRE * hƩps://www.aircre.com * 213-687-8777 * [email protected] NOTICE: Nopart oftheseworks maybe reproducedin anyformwithout permissionin wriƟng.