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Agreement - Advantage Peak, LLC - 1st Amendment - Willey House Lease Amendment - Signed 2022-06-07City of Gilroy Agreement/Contract Tracking Today’s Date: June 9, 2022 Your Name: Bryce Atkins, on behalf of Karine Decker Contract Type: Other (Non-Standard contracts must be reviewed by the City Administrator prior to initiating) Phone Number: (408)846-0210 Contract Effective Date: (Date contract goes into effect) 6/7/2022 Contract Expiration Date: 6/30/2023 Contractor / Consultant Name: (if an individual’s name, format as last name, first name) Advantage Peak, LLC Contract Subject: (no more than 100 characters) Willey House Lease Amendment Contract Amount: (Total Amount of contract. If no amount, leave blank) 0 By submitting this form, I confirm this information is complete: Date of Contract Contractor/Consultant name and complete address Terms of the agreement (start date, completion date or “until project completion”, cap of compensation to be paid) Scope of Services, Terms of Payment, Milestone Schedule and exhibit(s) attached Taxpayer ID or Social Security # and Contractors License # if applicable Contractor/Consultant signer’s name and title City Administrator or Department Head Name, City Clerk (Attest), City Attorney (Approved as to Form) Routing Steps for Electronic Signature Risk Manager City Attorney Approval As to Form City Administrator or Department Head City Clerk Attestation DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 1 4876-4696-2977v3 SSCORDELIS\04706216 FIRST AMENDMENT TO SINGLE TENANT LEASE (Willey House) THIS FIRST AMENDMENT TO LEASE (“First Amendment”), is entered into on June 7, 2022 (“Effective Date”), by and between The CITY OF GILROY, a California municipal corporation (“Landlord”), and ADVANTAGE PEAK LLC, a California limited liability company (“Tenant”). Recitals: A. Landlord and Tenant entered into that certain Single Net Lease, dated as of March 1, 2020 (“Lease”) covering certain “Premises” consisting of the building commonly known as the Willey House (“Building”), and the land on which the Building is located. The Premises are located at 140 5th Street, in the City of Gilroy, County of Santa Clara, State of California. B. Landlord and Tenant desire to amend the Lease on the covenants and provisions, and subject to the terms and conditions, set forth in this First Amendment. Agreements: NOW, THEREFORE, in consideration of the mutual agreements contained in this First Amendment and for other valuable consideration, the receipt and adequacy of which are hereby acknowledged, Landlord and Tenant agree as follows: 1. Incorporation of Recitals and Defined Terms. Landlord and Tenant hereby incorporate the foregoing Recitals into the body of this First Amendment as though fully set forth herein. Landlord and Tenant acknowledge and agree that the foregoing Recitals are true and correct and form the basis for the execution and delivery of this First Amendment. Terms appearing in this First Amendment with initial capital letters that are not expressly defined in this First Amendment shall have the meanings, if any, ascribed to such terms in the Lease. 2. Use of the Premises. The first sentence of Section 5.1 of the Lease is hereby deleted and replaced in its entirety with the following: “Tenant shall use the Premises, both indoors and outdoors, solely for general office purposes, the operation of a wine tasting facility identified as the “South County Wine Tasting Room”, and special events (including but not limited to catered weddings and private/corporate functions), subject to compliance with the terms and provisions of this Lease and all applicable laws, and for no other purpose.” 3. Landlord’s Responsibility for Maintenance and Repair. Section 6.1 of the Lease is hereby deleted and replaced in its entirety with the following: “Any maintenance, repairs and/or replacements relating to the life -safety, heating, ventilation and air- conditioning, plumbing, electrical and/or any other systems serving the Premises and/or Building shall be made and paid for by Landlord. Notwithstanding the foregoing, if any maintenance, repairs and/or replacement(s) relating to the life safety, heating, ventilation and air-conditioning, plumbing or electrical systems described in the immediately-preceding sentence shall be caused by (i) alterations made by or on behalf of Tenant, and/or (ii) the misuse, excessive use or negligence of Tenant or Tenant’s agents, contractors, employees, subtenants, licensees, invitees or visitors, then Tenant shall reimburse Landlord upon demand for 100% of the cost of such repairs and/or replacements as Additional Rent. DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 2 4876-4696-2977v3 SSCORDELIS\04706216 Landlord shall maintain in reasonably good order and repair, and replace if necessary, the (i) structural roof (and roof membrane) of the Building, (ii) structural and exterior walls (including painting t hereof), of the Building, (iii) foundations of the Building and (iv) subsurface utilities serving the Building. Tenant shall give prompt written notice to Landlord of any known maintenance work required to be made by Landlord pursuant to this paragraph. The costs incurred by Landlord pursuant to the provisions of this paragraph shall be paid by Landlord; provided, however, if any repair(s), replacement(s) and/or alteration(s) of the structural roof (or roof membrane), structural or exterior walls or foundations of the Building or subsurface utilities is/are caused by (and/or required pursuant to applicable law as a result of) (i) Tenant’s breach of any of Tenant’s obligations under this Lease, and/or (ii) any misuse of the Premises or Building by, or negligence or willful misconduct of, Tenant or any of Tenant’s agents, employees, contractors, subcontractors, affiliates, invitees, licensees, sublessees or other representatives, then Tenant shall reimburse or pay to Landlord, within thirty (30) days following receipt of a statement or invoice and reasonable back up documentation of such costs, for one hundred percent (100%) of the costs paid or incurred by Landlord to repair or replace the same. 4. Tenant’s Responsibility for Maintenance and Repair. Section 6.2 of the Lease is hereby deleted and replaced in its entirety with the following: “By taking possession of the Premises Tenant accepts the Premises as being in the condition in which Landlord is obligated to deliver the Premises. At all times during the term hereof and at Tenant’s sole cost and expense, Tenant shall keep the Premises and every part thereof, including without limitation, interior paint, flooring, doors and windows, bathrooms, lighting, other fixtures and all outdoor hardscape and landscaping fixtures, bulbs, ballasts, tubes, interior walls, interior surfaces of exterior walls, windows, and doors located within the Premises, in good condition and repair.” 5. Tenant Improvements. Section 6.4 of the Lease is hereby modified as follows: (A) The second sentence of the first paragraph of Section 6.4 of the Lease is hereby deleted and replaced in its entirety with the following: “As soon as reasonably practicable, Tenant shall commence the performance of general improvements to the Premises, including, but not limited to, electrical and plumbing upgrades, new interior paint and fixtures, new exterior hardscaping and landscaping and the construction of a new commercial kitchen (collectively, the “Tenant’s Work”).” (B) In the second sentence of the second paragraph of Section 6.4, the phrase “(or other contractor or professional approved in writing by Landlord)” is hereby deemed inserted after the phrase “licensed contractor”. Upon completion of Tenant’s Work (or a portion thereof), Tenant will furnish Landlord the following documents (all in form and content reasonably acceptable to Landlord): (i) paid invoices evidencing the cost of Tenant’s Work completed; (ii) visual evidence reasonably satisfactory to Landlord that Tenant’s Work has been completed (e.g., physical inspection, photographs, etc.); (iii) to the extent permits are required, all building permits, indicating inspection and approval of the Premises b y the issuer of said permits (to the extent not previously submitted to Landlord); (iv) unconditional lien releases in the statutory form from any and all contractors, subcontractors, and material suppliers who performed, or supplied materials for, Tenant’s Work; (v) a conformed copy of the Notice of Completion which has been duly recorded with respect to the Tenant’s Work; (vi) Landlord’s receipt of any information reasonably requested by Landlord; and (vii) Tenant’s compliance with Landlord’s “close-out” requirements regarding approvals, closeout tasks, Tenant’s contractor, financial close-out matters, and Tenant’s vendors. Landlord shall reimburse Tenant for the portion of Tenant’s Work that has been completed within thirty (30) days after DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 3 4876-4696-2977v3 SSCORDELIS\04706216 receipt all of the items listed in the preceding sentence; provided, however, that (A) Landlord shall only reimburse Tenant for up to One Hundred Thousand Dollars ($100,00.00) of Tenant’s Work (in the aggregate), even if the total cost of Tenant’s Work exceeds One Hundred Thousand Dollars ($100,00.00), it being the intent of the parties hereto that Tenant shall be responsible, at its sole cost and expense (without right of reimbursement), for any Tenant’s Work that exceeds One Hundred Thousand Dollars ($100,000.00), and (B) in no event shall Landlord have any obligation to reimburse Tenant for any Tenant’s Work for which Landlord does not receive all of the items described in the preceding sentence on or before the date that is twenty-four (24) months after the Effective Date of this First Amendment. 6. Condition of Premises. Tenant acknowledges that Tenant is currently in possession and occupancy of the Premises and Tenant is familiar with the condition of the Premises and the suitability of same for Tenant’s purposes. Tenant acknowledges that, except as otherwise expressly provided in the Lease, neither Landlord nor any agent, employee, affiliate, broker or other representative of Landlord has made any representations or warranties with respect to the condition of the Premises or with respect to the suitability of same for the conduct of Tenant’s business. Tenant further agrees and acknowledges that Landlord has no obligation to alter, improve or refurbish the Premises for Tenant’s use or benefit or to provide Tenant an allowance for such purpose (except as otherwise set forth in Section 6.4 of the Lease, as amended by Section 5 of this First Amendment) as a condition to Tenant leasing the Premises. 7. CASp Expert. Landlord and Tenant acknowledge and agree that, to Landlord’s actual knowledge (as of the Effective Date), the Premises have not been inspected by a Certified Access Specialist (“CASp”) pursuant to Section 1938 of the Civil Code. The parties further agree as follows: Pursuant to California Civil Code Section 1938(e), Landlord hereby further discloses to Tenant the following: “A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.” (b) Notwithstanding the foregoing and/or anything to the contrary contained in this First Amendment, Landlord and Tenant hereby agree and acknowledge that, in the event Tenant desires to obtain a CASp inspection, then: (x) Tenant shall provide Landlord with no less than twenty (20) business days’ prior written notice and, upon receipt of such notice, Landlord shall have the right to, a mong other things, (i) select the date and time at which such inspection shall occur, and (ii) have one (1) or more representatives present during such inspection. (y) Tenant hereby agrees and acknowledges that it shall (x) provide Landlord with a copy of any and all findings, reports and/or other materials (collectively, the “CASp Report”) provided by the CASp immediately following Tenant’s receipt thereof, (y) at all times maintain (and cause to be maintained) the CASp Report and its findings (and any and all other materials related thereto) confidential and (z) pay for the CASp inspection and CASp Report at Tenant’s sole cost and expense. If Tenant receives a disability access inspection certificate, as described in subdivision (e) of California Civil Code Section 55.53, in connection with or following any CASp inspection undertaken on behalf, or for the benefit, of Tenant, then Tenant shall cause such certificate to be provided immediately to Landlord. DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 4 4876-4696-2977v3 SSCORDELIS\04706216 (z) If the CASp Report identifies any violation(s) of applicable construction- related accessibility standards (“CASp Violation(s)”), Tenant shall immediately provide written notice to Landlord of any and all such CASp Violation(s). In such event, Tenant shall, at Tenant’s sole cost and expense, perform, or cause to be performed, any repairs, modifications and/or other work necessary to correct such the CASp Violation(s) (any such repairs, modifications and/or other work being collectively referred to herein as the “CASp Work”). Tenant shall commence (or cause the commencement of) such CASp Work no later than fifteen (15) business days after Landlord’s receipt of the CASp Report in accordance with the terms and conditions of this First Amendment. Tenant shall diligently prosecute (or cause to be diligently prosecuted) to completion all such CASp Work in a lien free, good and workmanlike manner, and, upon completion, obtain an updated CASp Report showing that the Premises then comply with all applicable construction-related accessibility standards. Any and all cost and expense associated with the CASp Work and/or the updated CASp Report (which Tenant shall provide to Landlord immediately upon Tenant’s receipt thereof) shall be at Tenant’s sole cost and expense. Without limiting the generality of the foregoing, Tenant hereby agrees and acknowledges that: (i) Tenant assumes all risk of, and agrees that Landlord shall not be liable for, any and all loss, cost, damage, expense and liability (including, without limitation, court costs and reasonable attorneys' fees) sustained as a result of the Premises not having been inspected by a Certified Access Specialist (CASp); (ii) Tenant's indemnity obligations set forth in this First Amendment shall include any and all claims relating to or arising as a result of the Premises not having been inspected by a Certified Access Specialist (CASp); and (iii) Landlord may require, as a condition to its consent to any alterations, additions or improvements, that the same be inspected and certified by a Certified Access Specialist (CASp) (following completion) as meeting all applicable construction-related accessibility standards pursuant to California Civil Code Section 55.53. 8. Representations and Warranties of Tenant. Tenant, with the understanding that Landlord is relying upon the following representations and warranties of Tenant in entering into this First Amendment, represents and warrants to and for the benefit of Landlord as follows: a. Tenant is Holder of Leasehold. Tenant is the “Tenant” under the Lease and the sole holder of the leasehold estate created under the Lease. b. No Assignment. Tenant has not voluntarily, by operation of law or otherwise: (i) assigned the Lease or any of the interest of Tenant in or under the Lease; (ii) sublet the Premises or any part thereof; (iii) allowed the occupancy or use of the Premises, or any portion of the Premises, by any person or entity other than the employees of Tenant; (iv) hypothecated, mortgaged or granted any security interest in all or any portion of the leasehold estate created under the Lease; (v) created any lien or encumbrance, whether voluntary, involuntary or by operation of law, upon all or any portion of the leasehold estate created under the Lease; or (vi) divested itself of all or any portion of the leasehold estate created under the Lease. c. Lease in Full Force and Effect. The Lease is in full force and effect and has not been previously amended. d. Lease is Sole Agreement. The Lease is the sole document relating to the leasing, use and occupancy of the Premises and there are no other documents, agreement or understandings, whether written, oral or resulting from course of conduct, relating to the leasing, use or occupancy of the Premises. e. No Default by Landlord. All of the obligations of the “Landlord” under the Lease have been performed, and there is no event or condition that with the giving of notice or the elapse of any period of cure, or both, required under the Lease would constitute a breach or default of any obligation of the “Landlord” under the Lease. DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 5 4876-4696-2977v3 SSCORDELIS\04706216 f. No Claims by Tenant. Tenant has no claims, rights of set off, actions, causes of action or demands against Landlord arising out of, related to or connected with the Lease or the Premises. g. Tenant Not Insolvent. (i) Tenant is paying its debts as they become due, is not insolvent and is not otherwise entitled to protection, or intending to file for protection, under any state or federal bankruptcy, insolvency or debtor protection law or statute, and (ii) the entry by Tenant into this First Amendment does not render Tenant insolvent or otherwise entitled to protection, or to file for protection, under any state or federal bankruptcy, insolvency or debtor protection law or statute. h. Office of Foreign Assets Control Compliance. The entities or individuals constituting Tenant or which may own or control Tenant or which may be owned or controlled by Tenant are not (i) in violation of any laws relating to terrorism or money laundering, and/or (ii) among the individuals or entities identified on any list compiled pursuant to Executive Order 13224 for the purpose of identifying suspected terrorists or on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, http://www.treas.gov/ofac/tllsdn.pdf or any replacement website or other replacement official publication of such list. The representations and warranties of Tenant set forth in this Section 8 are continuing and shall survive the execution and delivery of this First Amendment. 9. Brokers. Tenant represents and warrants to and for the benefit of Landlord that Tenant has not had any dealings with any realtor, broker or agent in connection with the negotiation of this First Amendment. Tenant agrees to indemnify, protect, defend and hold Landlord harmless from and against any cost, expense or liability for any compensation, commission, fee or charge claimed by any realtor, broker, agent or person with respect to the extension of the term of the Lease as described herein and/or the negotiation of this First Amendment by reason of any claimed agreement, dealings or contact with Tenant. 10. Ratification. Except as amended by the provisions of this First Amendment, the terms and provisions of the Lease remain in full force and effect. Landlord and Tenant ratify and affirm the Lease as amended by this First Amendment. In the event of any conflict or inconsistency between the terms of this First Amendment and the Lease, the terms of this First Amendment shall control. 11. Choice of Law. The terms and provisions of this First Amendment shall be construed in accordance with, and governed by, the laws of the State of California without application of any choice of laws provisions. 12. Binding Agreement. The Lease, as amended by this First Amendment, is binding on and inures to the benefit of the respective heirs, representatives, successors and assigns of Landlord and Tenant. Neither Landlord nor Tenant has been induced to enter into this First Amendment by, nor is Landlord or Tenant relying upon, any representation or warranty other than those set forth in this set forth in this First Amendment. 13. No Drafting Presumption. The doctrine or rule of construction that ambiguities in a written instrument or agreement shall be construed against the party drafting the same shall not be employed in connection with this First Amendment. 14. Attorneys’ Fees. If Landlord or Tenant fails to perform any of its obligations under this First Amendment or if any dispute arises between Landlord and Tenant concerning the meaning or interpretation of any provision of this First Amendment, then the prevailing party shall be entitled to recover and receive from the defaulting party or the party not prevailing in such dispute, as the case may be, all DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 6 4876-4696-2977v3 SSCORDELIS\04706216 costs and expenses incurred by the prevailing party on account of such default and/or in enforcing or establishing the rights of the prevailing party under this First Amendment, including, without limitation, court costs, attorneys’ fees and disbursements. Any such attorneys’ fees and other expenses incurred by the prevailing party in enforcing a judgment in its favor under this First Amendment shall be recoverable separately from and in addition to any other amount included in such judgment, and such attorneys’ fees obligation is intended to be severable from the other provisions of this First Amendment and to survive and not be merged into any such judgment. 15. Partial Invalidity. If any term, covenant or provision of this First Amendment is, to any extent, held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this First Amendment, or the application of that term, covenant or provision to persons or circumstances other than those as to which it is held to be invalid or unenforceable, will not be affected by such invalidity or unenforceability, and all other terms, covenants and conditions of this First Amendment will be valid and enforceable to the fullest extent permitted by law. 16. Construction. Unless the context clearly requires otherwise, in this First Amendment (a) the masculine, feminine and neuter genders shall each be deemed to include the others; (b) “shall,” “will,” “must,” “agrees,” and “covenants” are each mandatory; (c) “may” is permissive; (d) “or” is not exclusive; and (d) “includes” and “including” are not limiting. Each covenant, agreement, obligation or other provision of this First Amendment shall be deemed and construed as a separate and independent covenant of the party bound by, undertaking or making the same, not dependent on any other provision of this First Amendment, unless otherwise expressly provided in this First Amendment. 17. Captions. The captions to the Sections in this First Amendment are included for convenience of reference only and do not modify or define any of the provisions of this First Amendment. 18. Counterparts. This First Amendment may be executed in separate counterparts, each of which shall constitute an original and all of which together shall constitute one and the same document. The parties contemplate that they may be executing counterparts of this First Amendment transmitted by facsimile or email in pdf format and agree and intend that a signature transmitted by either facsimile machine or email in pdf format shall bind the party so signing with the same effect as though the signature were an original signature. [balance of page is intentionally blank; signature page follows on next page] DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 7 4876-4696-2977v3 SSCORDELIS\04706216 IN WITNESS WHEREOF, Landlord and Tenant have caused this First Amendment to be executed as of the day and year written below. “LANDLORD”: “TENANT”: CITY OF GILROY, a California municipal corporation By: __________________________ Name: __________________________ Title: __________________________ Dated: __________________________ ATTEST: _________________________________ City Clerk Dated: ___________________________ APPROVED AS TO FORM: _________________________________ City Attorney Dated: ___________________________ ADVANTAGE PEAK LLC, a California limited liability company By: Its: Date: DocuSign Envelope ID: E7BD308F-5181-455E-A048-7FFF87D385E5 7/13/2022 manager 7/15/2022 City Administrator Jimmy Forbis 7/15/2022 7/15/2022