Loading...
Agreement - Advantage Peak LLC - Single Tenant Lease (Willey House) - Signed 2020-03-12SINGLE TENANT LEASE Willey House) THIS LEASE, dated March 1, 2020 ("Effective Date"), is entered into by and betwee n THE CITY OF GILROY, a California municipal corporation ("Landlord"), and ADV ANT AGE PEAK LLC, a California limited liability company ("Tenant"). 1. PREMISES. Landlord hereby leases to Tenant and Tenant hereby hires from Landlord the building commonly known as the Willey House ("Building"), and the land on which the Building is located (the Building and such land shall be collectively referred to herein as the "Pre mi ses"). The Premises are located at 140 5th Street, in the City of Gilroy, County of Santa Clara, State of Ca lifornia. 2. LEASE TERM. 2.1 Term. The term of this Lease ("Term ") shall commence on March 1, 2020 (the Commencement Date") and expire, unless sooner terminated in accordance with the terms and conditions of this Lease, on the date that is sixty (60) full calendar months after the Commencement Date. Notwithstanding the foregoing, this Lease shall be subject to termination as elsewhere provided in this Lease. "Lease Termination" shall mean the expiration or sooner termination ofthis Lease. 2.2 Delay in Commencement Date. If Landlord is unable to deliver possession of the Premises on the Commencement Date, or any other date, Landlord shall not be liable for any damage caused thereby, nor shall thi s Lease be voidable, and the expiration date of this Lease shall not be extended by such delay ( except as otherwise expressly set forth in Paragraph 18 below). If Tenant, with Landlord's prior written consent, takes possession prior to the Commencement Date, Tenant shall do so subject to all of the covenants and conditions hereof. 2.3 Acceptance. Tenant hereby accepts the Premises in its "AS IS" condition without representation or warranty of any kind , express or implied, and subject to all applicable laws. Upon taking possession of the Premises, Tenant s hall be deemed to have accepted the Premises as being in good and sanitary order, condition and repair, and to have accepted the Premises in its existing condition, subject to all applicable laws, covenants, conditions, restrictions, easements and other matters of record. Landlord shall have no obligation to construct any improvements on or within the Prem ises for the benefit of Tenant. Neither Landlord nor Landlord's agents, employees or other representatives makes any representation or warranty as to the suitability of the Premises for the conduct of Tenant's business, the condition of the Premises, or the use or occupancy which may be made thereof, and Tenant has independently investigated and is satisfied that the Premises are and will be suitable for Tenant's intended use. Outside of security devices or systems already in stalled on the Premises, Tenant shall be solely responsible for installing or arranging for any security dev ices or services desired by Tenant for the Pre mises and the safety of persons or property upon the Premises, and Landlord s hall have no obligation or liability with respect to the provision or lack of provision of such security devices or services. 3 .1 Rent. Tenant agrees to pay monthly base rent ("Base Rent") to Landlord in the amount of $3 ,000 per month (on the first day of each month) commencing on the Commencement Date. All amounts which Tenant is required to pay under this Lease, and all damages, costs and expenses which Landlord may incur by reason of any default by Tenant under this Lease shall be deemed to be rent hereunder ("Rent"). All Rent shall be paid in lawful money of the United States to Landlord at the address specified in this Lease for purposes of notice, or to s uch other persons or at such other places as may be 4820-8468-4725v5 SSCORDELIS\04706083 - 1- designated in writing by Landlord from time to time. All Rent shall be paid without offset o r deduction and, except as otherwise expressly provided in this Lease, without prior notice or demand. Landlord acknowledges receipt, pursuant to a License Agreement for the Premises, of the sum of $3,000 as and for the first month 's Base Rent and the further s um of $3 ,000 to be applied to the last month's Base Rent. Base Rent shall be increased by three percent of the preceding year's Base Rent for each year of the Term, including any option years, except for the first year of the first Option Period, for which the Base Rent shall be established in accordance with the terms of Paragraph 18 below. 4. TAXES. 4.1 Real Prope1ty Taxes. Tenant shall pay, before the same become delinquent, all Real Prope1ty Taxes imposed against Landlord or Tenant in connection with thi s Lease or against the Premises. As used in this Lease, Real Property Taxes means any form of assessment, license, fee , rent tax, levy or tax (other than net income, estate, successor or inh eritance taxes), now or hereafter imposed by any authority having the direct or indirect powe r to tax or by any city (including Landlord), county, state or federal government or any improvement or other district or divi sion thereof, whether or not now c ustomary or within the contemplation of the patties, ordinary or extraordinary, general or speci a l, or resulting from increased rate or valuation, together with ai1y taxes levied or assessed in lieu of, in s ubstitution for, or in addition to existing taxes and assessments against the Premises, including without limitation any possessory interest tax. In connection with California Revenue and Taxation Code section 107 .6, Landlord states and Tenant acknowledges that by entering into this Lease, a possessory interest subject to property taxes may be created. Tenant or other parties in whom the possessory interest has vested may be subject to the payment of property taxes levied on such interest. 4.2 Tax on Leasehold or Personal Property. Tenant shall be responsible for and shall pay before delinquency all municipal, county or state taxes, levies and fees of every kind and nature including, but not limited to, general or special assessments assessed during the Term against any leasehold interest or trade fixtures or personal property of any kind, owned or leased by or placed in, upon or about the Premises by Tenant. Tenant agrees to pay before delinquency the amount of a ll taxes levied upon or measured by th e rent payable hereunder, whether as a so-called sales tax, transaction privilege tax, excise tax, or otherwise. If such ta.-xes, levies or fees are assessed, levied, or imposed up on Landlord or any p01tion of the Premises, Landlord shall give Tenant a statement of the amount applicable to the Premises. If a separate assessment of the improvements is not available from the appropriate governmental authority, Landlord's good faith allocation s hall be binding o n Tenant. In s uch event, Tenant shall pay Landlord on demand for s uch taxes, levies and fees applicable to t he Premises. 5. CONDUCT OF BUSINESS BY TENANT. 5.1 Use of the Premises. Tenant shall use the Premises, both indoors and outdoors, solely for general office purposes 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. Subject to the terms of the preceding sentence, Tenant shall make the Premises available, free of rent charges (except for reasonable c leaning, catering or out-of- pocket service charges), to the Gilroy Chamber of Commerce and Gilroy Downtown Business Association so long as they comply with all rules and regulations relating to usage and food service and to the extent none of their events conflict with other Tenant events. Tenant may, at Tenant's optio n , make the Premises available for non-profit groups located in Gilroy for their events free ofrent c harges (except for reasonable cleaning, catering or out-of-pocket service charges). Tenai1t may hire companies that handle events. Landlord and Tenant and any event company retained by Tenant shall be the sole key ho lders to the Premises with alarm access to the Premises. Tenant's activities shall be s ubj ect to t he City of Gilroy 's rules and regulations. 1n no event shall Tenant permit any activity on the Premises that would 4820-8468-4725v5 SSCORDELIS\04706083 - 2- be determined under applicable laws to be legally obscene, or that would, if exhibited or occurring with respect to a commercial business or establishment, be subject to regulation under Chapter 2A of the City Gilroy Code (which regulates adult businesses), as such Chapter may be amended from time to time. Tenant's breach of any of its obligations pursuant to the prior sentence shall, at Landlord's election, constitute a non-curable default under this Lease, which in addition to all other rights and remedies available to Landlord by law, in equity or under this Lease, shall entitle Landlord to terminate this Lease by delivering to Tenant not less than ten ( I 0) days prior written notice . 5.2 Compliance with Law. Tenant, at its expense, shall comply promptly with all applicable laws regulating the use by Tenant of the Premises and the conduct of its activities on the Premises, including without limitation all copyright laws and licensing requirements, and any permits that may be required in connection with outdoor events. Tenant shall acquire all necessary City pennits fo r outdoor events, which may include noise and special event permits. City Staff will grant Tenant an annual event permit covering all necessary City permits for outdoor events, which will require compliance with City ordinances, policies and regulations, including without limitation, the noise restrictions contained in the Gilroy City Code Section 30.41.31 or any successor section. Tenant will comply with all such City ordinances, policies, and regulations. Tenant is permitted to place outdoor furniture on the outside of the Premis es. Tenant shall not use or permit the use of the Premises in any manner that will tend to create a nuisance. Tenant may place standard office furniture in the Premises, but shall place no heavy loads upon the floors , walls or ceilings in excess of the maximum designed load determined by Landlord or which endanger the structure ; nor place any harmful liquids in the drainage systems; nor dump or store waste materials or refuse or allow such to remain outside the Building, except in enclosed trash areas provided, if any. Other than outdoor furniture, Tenant shall not store or permit to be stored or otherwise place any other material of any nature whatsoever outside the Building. Tenant and Tenant's agents, officers, directors, employees, contractors, representatives, servants, licensees or invitees collectively "Tenant's Agents") shall not use, store or dispose, or allow the use, storage or disposal of, any Hazardous Materials on any portion of the Premises. As used in this paragraph, Hazardous Materials means any chemical, s ubstance or material which has been or is hereafter determined by any federal , state or local governmental authority to be capable of posing ri sk of injury to health or safety , including without limitation, petroleum, asbestos, polychlorinated biphenyls, radioactive materials and radon gas, but excluding substances commonly used to clean offices and event sites. 6. MAINTENANCE, REPAIRS, AND ALTERATIONS. 6.1 Landlord 's Responsibility for Maintenance and Repair. During the Te1m of thi s Lease or any extension thereof, Landlord shall not be respo nsible for the maintenance or repair of any portion of the Premises, and Tenant shall be responsible for correcting and paying for any and all damage or injury to the Premises, at its sole cost and expense. Tenant shall pay to Landlord any costs incurred by Landlord to correct damage or injury for which Tenant is re spons ible pursuant to the prior sentence not later ten (10) days after receiving Landlord's invoice for such costs . Landlord will paint the exterior of the Building during the first year of the Term. 6.2 Tenant's Responsibility for Maintenance and Repair. Tenant s hall, during the Term or any extension thereof, keep in good order, condition and repair the entire Premises, including, without limitation, all fixtures, exterior and interior walls and exterior and interior surface of walls, roof, roof drain system, interior and exterior painting, electrical and plumbing systems, heatin g, ventilating and air conditioning systems, other large-scale equipment, fire alarm and fire sprinkler systems, windows, plate glass, landscaping, paving and other exterior areas and improvements located on the Premises from time to time. Tenant's obligations under this Paragraph s hall include the obligation to replace any of the foregoing item s, or any portion thereof, which cannot be fully repaired. Tenant shall properly maintain any landscaping to ensure there are no overgrown weeds, regularly manicure the shrubbery , prevent and 4820-8468-4725v5 SSCORDELI S\04 706083 remove the accumulati on of garbage, and prevent long standing piles of dirt and an overall a ppearance of abandonment. The Premises sha ll be maintained by Tenant in an attractive, safe, and fully operativ e condition at all times during the Term. To maintain the facility equipment in good workin g order and to prevent breakdowns, the Tenant shall ensure the facilitation of regularly sc hedu led maintenance on all faciUty equipment which requires on-going serv icing to ma intain their good workin g condit ion . This shall include (at a minimum) bi-annua l maintenance on the HVAC eq uipme nt, all required fire alarm and fire sprinkler equipment inspections and maintenance, and annual roof and roof drain maintenance. This aforementioned required mainten ance must be performed by qualified contractors, and the documentation of s uch work provided to Landlord. Notwithstanding th e above requ irement s, if, during the Term o r any extension thereof, an inc ident occurs in which a "Major System" -defined exclusively as the roof, Building structure, HYAC system , fire a larm syst em, or fire sprin k ler system -breaks down , a nd the Major System has been maintai ned properly by the Tenant, Tenant shall be responsible for the cost to repair or replace equipment in the Major System only up to $5,000 per incident. Landlord sha ll have the option to cover the cost to repair or replace the broken e quipment in the Major System exceeding $5,000, or alternatively to terminate the lease pursuant to Paragraph 2.1. T he election of e ith er o pti on by Landlord shall not constitute a default by L andlord here under. If multipl e Major Systems conc urrently break down, then the concurrent break downs shall be treated as o ne inc ident and costs to repair or replace the Major Systems shall be calculated cumulative ly such that T ena nt is responsible only for costs of re pairs or rep lacement of broken equipment up to $5,000 per incident. In no event sha ll Landlord have any repair or ma intenance responsibility for the Premises, or any portion thereof, except as otherwise expressly provided in this Leas e. Tenant waives the provisions of California C iv il Code secti on s 1932(1), 1941 and 1942 and a ny s imilar law now or hereafter in effect. 6.3 Conditi on Upon Surrender. On Lease Termination, Tenant sha ll remove its personal property and such Tenant trade fi xtures from the Premises as T enant wishes, s urre nd er the Premises to Landlord in at least as good a condition as whe n received by Tenant under thi s Lease, ordina ry wear and tear excepted, subject to Paragraph 8.1 below. At Landlord's option, Landlord shall have the ri ght to require that Tenant remove any and all a lteratio ns, additions, s igns, rutwork or improvements made by Tenant during the Term of this Lease and perform at1y necessary rep airs caused by such re moval to the condition that existed prior to the installation of s uc h a lterati on , ad diti o n, sign, artwork or impro vemen t and in accordan ce w ith all applicable laws in effect as of the date of s uch re pair. 6.4 lmprovements by Tenant. Tenant sha ll ma inta in the historical aesthetics of the Premises in a manner acceptable to C ity, and sha ll in no event perform any improvement or take any acti on that would detract fro m the historic character of the Premis es. During the term of this Lease, Tenant sh all (i) upda te the kitchen and bathrooms, (ii ) in stall doors in some lower level open areas, (iii) in stall new w indow coverin gs, (iv) upgrade the uppe r level unfinis hed office sp ace, and (v) insta ll carpet/hardwood fl oors on the uppe r level and change out the door knobs throughout the office. The improvements described in the preced in g sentence shall be deemed "Improvements" under this Section 6.4, and sha ll be subject to a ll of the terms and condit ions of this Lease. Tenant sh a ll not, without prior written consent of Landlord (which consent may be granted o r w ithhe ld in Landlord's sole and absolute discretion), make or insta ll any alterations, improve ments, or add it ions (collectively, "Improvements") to the Prem ises, including without lim itation any exterior la nd scapin g or outdoor facilities or improvements. Before commenc in g any Improvements, Tenant sha ll submit plans ru1d specifications to Landlord for Landlord's approval. At least ten (10) days prior to undertaking construction or installation of any Imp rovements, Tenant sh all give written notice to Land lord settin g forth the date work is to commence. Landl ord sha ll have the right at a ll reasonab le times to post and keep posted on the Premises suc h notices of non -responsibility as Landlord may deem necessary for the protection of Landlord and the Premises from mechanic's a nd materialman 's liens . All lmprovements shall be in sta lled at Tenant's sole cost and expe nse, in compliance with all appli cable laws, permit requirements and a ny covenants, 4820-8468-4725v5 SSCORDELIS\04706083 - 4- conditions or restrictions of record, by a li censed contractor, shall be done in a good and workmanlike manner conforming in quality and design with the Premises existing as of the date the Premises were delivered to Tenant under this Lease, and shall not diminish the value of the Premises. All Improvements made by Tenant shall be and become the property of Landlord upon installation and shall not be deemed Tenant's personal property; provided, however, that Landlord may, at its option, require that Tenant, at Tenant's expense, remove any or all Improvements installed by Tenant and restore the Premises to their condition that existed prior to the installation of the Improvements and in accordance with a ll applicable laws in effect as of the date of such repair. This paragraph shall survive the Lease Termin ation. Tenant shall be solely responsible for the maintenance and repair of any Improvements made by Tenant to the Premises. · 7. INSURANCE AND INDEMNITY. 7.1 Tenant's Insurance. Tenant shall at a ll times during the Term, at Tenant's sole cost and expense, maintain in effect the following insurance: i) required by law; Worker's compensation insurance in not less than the mmlillum amounts ii) Commercial general li ability insurance (at least as broad as the most commonly availab le ISO Commercial General Liability policy form CG 00 01), or such successor comparable form of coverage in the broadest fonn then availab le, for the mutual benefit of Landlord and Tenant, against any and all c la im s and liabi lities arising out of the ownership, use, occupancy or maintenance of the Premises, or Tenant's activities thereon. The minimum limit of coverage of such policy shall be in the amount of not less than One Mi lli on Dollars ($1 ,000,000) per occurrence and annual aggregate, shall include an extended liability endorsement providing contractual liability coverage (which shall include without limi tation coverage for Tenant's indemnification, defense and hold harmless obli gations in this Lease), and shall contain a severabili ty of interest clause or a cross liability endorsement. Such insurance shall further insure Landlord and Tenant against liab ili ty for property damage of at least One Million Dollars ($1,000,000); and iii) Business automobi le liabi li ty insurance having a combined single limit of not less than One MiUion Dollars ($1,000,000) per occurrence and insuring Tenant against liability for claims for bodily injury, death, or property damage, arising out of ownership, maintenance, or use of any owned, hired or non-owned automobi les. 7.2 General Requirements. No policy maintained by Tenant under Paragraph 7.1 shall contain a deductible greater than Two Thousand F ive Hundred Dollars ($2,500). No policy shall be cancelable or s ubject to reduction of coverage without thirty (30) days prior written notice to Landlord except for nonpayment which shall require not less than ten (10) days ' notice). Such policies of in s urance shall be issued as primary policies and not contributing w ith or in excess of coverage that Land lord may carry, by an insurance company authorized to do b usiness i11 Californ ia for the issuance of such type of ins urance coverage and having an AM Best financial strength rating or A+ or better. A ll deductibles shall be deemed self-insured with fu ll waiver of s ubrogation. All Tenant policies shall contain an endorsement that the insurer waives its right to subrogation. The types of insurance and minimum limits specified above am the minimum required by Landlord, and Landlord may from time to time require changes and/or additions thereto to meet changed circumstances or as otherwise reasonabl y required by Landlord, including without limitation changes in the purchasing power of the dollar and changes consistent with the standards required by other landlords in Santa C lara County, California. Tenant's obli gations under this Lease s hall not be limited to the amount of any insurance required of or carried by Tenant under Paragraph 7.1 and Tenant is respons ible for ensuring that the amount of 4820-8468-4725v5 SSCORDELIS\04706083 - 5- insurance carried by Tenant is sufficient for Tenant's purposes. All insurance required to be carried by Tenant hereunder shall be in companies, on forms and with loss payable clauses satisfactory to Landlord and copies of policies of such insurance, certified by the insurer to be a true and correct copy of the insurance policies, shall be delivered to Landlord by Tenant prior to the Commencement Date. A new certified policy shall be delivered to Landlord at least thirty (30) days before expiration of the old policy. The liability policies to be carried by Tenant under this Lease shall name Landlord and its agents, employees and designated lenders as additional insureds. All policies shall provide coverage on an occurrence basis and not on a claims made basis. 7.3 Waiver of Liability. Landlord and Tenant each hereby waives any and all rights of recovery against the other or against the employees, representatives and agents of such other paity for loss of or damage to such waiving party or its property or the property of others under its control, arising from any cause to the extent insured against under any insurance policy carried by such waiving party and to the extent such waiver is permitted under such insurance policy and does not prejudice coverage under such policy. Tenant shall obtain and furnish evidence to Landlord of the waiver by Tenant's insurance carriers of any right of subrogation against Landlord. 7.4 Tenant to Hold Landlord Harmless. Tenant hereby agrees to defend, indemnify and hold hai·mless Lai1dlord ai1d Landlord 's employees, represe ntatives and agents from and against any and all claims, damages, losses, liabilities, judgments or expenses (including without limitation attorneys ' fees) due to ai1y cause, including without limitation those relating to bodily injury, property damage or copyright infringement, which arises out of or is in any way attributable to the use or occupai1cy of the Premises or any part thereof including any community gardens on the Premises by Tenant or Tenant's Agents, the acts or omissions of Tenant or Tenai1t's Agents or Tenant's breach of this Lease, except to the extent caused by the willful misconduct or negligence of Landlord. This paragraph and Tenant's obligation hereunder shall survive Lease Termination. 7.5 Landlord 's Disclaimer. Landlord shall not be liable for injury or damage which may be sustained by the person, goods, wares, merchandise or property of Tenant, its employees, invitees or customers or any other person in or about the Premises caused by or resulting from fire, steam, electricity, gas, water or rain which may leak or flow from or into any part of the Premises, or from the breakage, leakage, obstruction or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures of the same, or from ai1y other cause, whether such damage or injury results from conditions arising upon the Premises or from other sources. 8. REPAIRS AND RESTORATION. 8.1 Damage. Landlord shall have no obligation to rebuild, restore or repair all or any portion of the Premises in the event of any damage or destruction thereto from any cause. If at any time during the Term the Premises are damaged to the extent such damage materially interferes with Tenant's continued use of the Premises, and Lai1dlord elects not to rebuild, restore or repair, Tenant's sole right shall be to terminate this Lease by giving written notice of termination, if Tenant elects not to make repairs at its own expense. Notwithstanding Tenant's election to terminate the Lease pursuant to this Paragraph 8.1, if the damage was caused by Tenant or Tenai1t's Agents, Tenant shall reimburse Landlord for all costs incurred by Landlord in repairing or rebuilding the Premises to the extent such costs exceed any Net Insurance Proceeds received by Landlord from any insurance policy. As used in this Lease, ''Net Insurance Proceeds" shall mean the proceeds of insurance received from the insurer, less costs of recovery. This paragraph and Tenant's obligations hereunder shall survive Lease Termination. 8.2 Notice. Rent Abateme nt, Re-fixturing. Tenant shall notify Landlord in wntmg immediately upon the occurrence of any damage or destruction to all or any portion of the Premises. 4820-8468-4725v5 SSCORDELIS\04706083 - 6- There shall be no abatement of Rent payable hereunder and Tenant shall have no claim against Landlord for any damage suffered by Tenant by reason of any such damage, destruction, repair or res toration. In no event shall any damage, destruction, restoration or repair of any portion of the Premises res ult in an extension of the expiration date of the Lease. 9. ASSIGNMENT AND SUBLETTING. 9.1 Landlord's Consent Required. Tenant shall not, either voluntarily, involuntarily or by operation of law (i) assign, sell or otherwise tran sfer all or any part of the Tenant's interest in this Lease or in the Premises, or (ii) permit any part of the Premises to be sublet, occupied or used by anyone other than Tenant or (iii) permit any person to s ucceed to any interest in this Lease or the Premises, (all of the foregoing being collectively referred to as a "Transfer"), without Landlord's prior written consent which shall not be unreasonably withheld). If Tenant i s a corporation, any dissolution, merger, consolidation or reorganization of Tenant, the transfer, assignment or hypothecation of any stock or interest in s uch corporation in the aggregate in excess of twenty-five percent (25%), or the sale cumulatively) of fifty perce nt (50%) or more of the value of Tenant's assets shall be deemed a Transfer. If Tenant is a paitnership, a withdrawal or substitution of any partner(s) owning twenty-five percent 25%) or more of the partnershjp (cumulatively), any assignment(s) of twenty-five percent (25%) or more cumulatively) of any interest in the capital or profits of the paitners hip, the sale ( cumulatively) of fifty percent (50%) or more of the value of Tenant's assets, or the dissolution of the partners hip shall be deemed a Transfer. [f Tenant is a limited liability company, ai1y dissolution, merger, consolidation or reorganization of Tenant, the transfer, assigmnent or hypothecation of a membership, economic or other interest in the limited liability company in the aggregate in excess of twenty-five percent (25%), or the sale (cumulatively) of fifty percent (50%) or more of the value of the limited liability company's assets shall be deemed a Transfer. In the case of any other entity comprising Tenant, any transfer, assignment or hypothecation of any interest in such entity in the aggregate in excess of twenty-five percent (25%), or the sale (cumulatively) of fifty percent (50%) or more of the value of Tenant's assets shall be dee med a Transfer. In no event s hall Tenant hypothecate, mortgage, pledge or encumber Tenant's interest in this Lease or in the Premises or otherwise use the Lease as a security device in any manner, nor s hall Tenant transfer any right appurtenant to this Lease or the Premises separate from a permitted Transfer. Tenant expressly agrees that the provis ions of this Article are not unreasonable s tandards or conditions for purposes of Section 195 J.4(b )(2) of the California Civil Code, as amended from tin1e to tin1e, under the federal Bankruptcy Code, or for any other purpose. 10. EMINENT DOMAIN. I 0.1 Automatic Termination. If the entire Premi ses, or so much of either as to make the Premises not reasonably adequate for the conduct of Tenant's business in Tenant's reasonable judgment s hall be taken under the power of eminent domain other than by Land lord, this Lease shall automatically terminate as of the date on which the condemning authority takes possession. 10.2 Rent Abatement. If a portion of the Premises is taken by power of eminent domain which does not result in a termination of this Lease, then this Lease s hall continue in full force and effect as to the part of the Premises not so taken. There shall be no abatement of Rent payable hereunder and Tenant shall have no claim against Landlord for any damage suffered by Tenant by reason of any taking of the Premises under the power of eminent domain other than by Landlord. 10.3 Condemnation Award. Any award for any taking of all or any part of the Premises under the power of eminent domain other than by Landlord shall be the property of Landlord, whether such award s hall be made as compensation for diminution in value of the leasehold or for taking of the fee. In no event s hall Landlord be obligated to make any repairs or perform a ny restoration or other 4820-8468-4725v5 SSCORDELIS\04706083 - 7- work required as a result of a taking. Nothing contained herein, however, shall be deemed to preclude Tenant from obtaining, or to give Landlord any interest in, any award to Tenant for loss of or damage to Tenant's trade fixtures and removal of personal property and Tenant's moving expenses. 10.4 Sale Under Threat of Condemnation. A sale by Landlord to any authority having the power of eminent domain, either under threat of condemnation or while condemnation proceedings are pending, shall be deemed a taking under the power of eminent domain for all purposes under this Atticle. Each party waives the provisions of California Code of Civil Procedure Section 1265.130 allowing either party to petition the Superior Court to tenninate this Lease in the event of a taking. 11. UTILITY SERVICES. Tenant shall arrange and pay for janitorial services and janitorial supplies to the Premises and shall arrange and pay for water, sewer, gas, electric, telephone, cable, on-line and any other utility services to the Premises, and for any security or ala1m system or services that Tenant desires for the Premises. Landlord s hall not be liable in damages or otherwise for any failure or interruption of any utility or service being furnished to the Premises, including without limitation any security or alarm system or service, and no such failure or interruption shall affect Tenant's obligations under this Lease. Landlord shall be entitled to cooperate voluntarily and Tenant agrees to cooperate, with the efforts of governmental authorities or utility suppliers in reducing energy or other resource consumption. 12 . DEFAULTS. REMEDIES. 12.1 Defaults. The occurrence of any one or more of the following events shall constitute a default hereunder by Tenant: 12.1.1 The abandonment of the Premises by Tenant. Abandonment is defined to include, but is not limited to, any absence by Tenant from the Premises for ten (10) consecutive days or longer. 12.1.2 The failure by Tenant to make any payment required by this Lease as and when due. 12.1.3 The failure by Tenant to timely observe or perform any of the express or implied covenants or provisions of this Lease to be observed or performed by Tenant, which this Lease characterizes as a non-curable default. 12. 1 .4 The failure by Tenant to timely observe or perform any of the express or implied covenants or provisions of this Lease to be observed or performed by Tenant, other than as specified in Paragraphs 12.1. l or 12.1.2 above, and othe r than those that this Lease characterizes as a non- curable default. 12.1.5 (a) The making by Tenant of any general assignment for the benefit of creditors; (b) the appointment of a trustee or receiver to take possession of substantially all of Tenant's assets located at the Premises or of Tenant's interest in this Lease, where possession is not restored to Tenant within thirty (30) days, or (c) the attachment, execution or other judicial seiz ure of substantially all of Tenant's assets located at the Premises or of Tenru1t's interest in this Lease, where seiz ure is not discharged within thi1ty (30) days. · 12 .2 Remedies. Upon a default, Landlord s hall have the following remedies, in addition to all other rights and remedies provided by law or otherwise provided in this Lease, to which Landlord may resort cumulatively or in the alternative: 4820-8468-4725v5 SSCORDELIS\04706083 - 8- 12.2.1 Landlord may continue this Lease in full force a nd effect, and th is Lease shall continue in full force and effect as lon g as Landlord does not terminate this Lease, and Landlord sha ll have the right to collect Rent when due. No act by Landlord other than giving written notice to Tenant shall terminate this Lease. Acts of maintenance, efforts to rel et the Pre mi se s o r the appointment of a rece iver on Landlord 's initiative to protect Landlord 's interest und er this Lease sha ll not constitute a termination of Tenant's right to possession. 12 .2 .2 Landlord may tenninate this Lease and Tenant's right to possess ion of t he Premises at any time (i) if such default is in th e pay ment of Rent and it is not cured w ithin five (5) days after written notic e from Landlord, or, (ii ) with respect to the defau lts referred to in Paragraphs 12.1.1 , or 12.1.4, if such default is not cured within thirty (30) days after written notice from Landl ord ; provided, however, that if the nature of Tenant's default is such that more than thirty (30) days are reaso na bly required for its cure, if Tenant does not commence to cure the defau lt within the thirty (30) day period or does not diligently and in good faith prosecute the cure to compl etion w ithin a reasonable time thereafter, or (iii) w ith respect to a default descri bed in Paragraph 12.1.3, upon delivery to Tenant of not less than te n (l 0) days prior written notice of termination , or (iv) w ith re spect to a default specified in Paragraph 12.1.5, if such default is not cured w ithin the respective time specifi ed in that paragraph. The parties agree that any notice given by Landlord to Tenant pursuant to thi s Paragraph 12.2.2 shall be suffic ient notice for purposes of Cali forn ia Code of C ivil Procedure Section 11 6 l and Landlord s hall not be required to g ive any additional notice in o rder to be entitled to comm e nce an unlawful detainer proceeding. On termination, Landlord has the ri ght to rem ove a ll of Tenant 's personal property, s igns and trade fixtu res and stor e same at Tena nt's cost and to recover from Tenant as damages: 12.2 .2.1 The worth at the time of award of unpaid R ent and other s um s due a nd payable whi ch had been earned at the time oftermination; p lu s 12.2.2.2 The worth at the time of award of the amount by which the unpaid Rent and other sum s due and payable whi c h would have been payab le afte r termination until the time of awa rd exceeds the amount of suc h Rent loss that Tenant proves could have been reasonab ly avoi ded; plus 12.2.2.3 The worth at the time of award of the amount by which the unpaid Rent and othe r sum s due and payable for the balance of the Term after the time of award exceeds the amount of s uch rental loss that Tenant proves co uld be reasonably avoided; plus 12.2.2.4 Any other a mount necessary to compensate Landlord for a ll the detrim ent proximate ly caused by Tenant's failure to perform Tenant 's obli gations under thi s Lease, or whi c h, in the ordinary course of th ings, would be like ly to res ul t therefrom ; plus 12.2.2.5 Such other amounts in addition to o r in li eu of the forego in g as may be permitted from time-to-time by the laws of the State of Cali fornia. The "worth at the time of award" of the amounts referred to in Paragraphs 12.2 .2.1 and 12.2.2.2 is computed by allowin g interest at the Stipulated Rate (defined in Paragraph 16). The "worth at the time of award" of the amount referred to in Paragraph 12.2 .2.3 is computed by discounting s uc h amount at the d isco un t rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1 %). 12 .2 .3 No delay or om ission of Landl ord to ex ercise any right or remedy s ha ll be construed as a waiver of any s uch ri ght or remedy or of any d efault by Tenant hereunde r. 4820-8468--4725v5 SSCORDELIS\04706083 - 9- 12.3 Default by Landlord. Landlord shall not be deemed to be in default in th e performance of any obligation required to be performed by it hereunder unless and until it has failed to perform such obligation within thirty (30) days after written notice by Tenant to Landlord s pecifying wherein Landlord has failed to pe1form such obligation; provided , however, that if the nature of Landlord's o bligat ion is such that more than thirty (3 0) days are required for its performance then Landlord s hall not be deemed to be in default if it shall commence s uch performance within such thirty- day period and thereafter diligently prosecute the same to completion. Notwithstanding any other provision of this Lease, in no event shall Landlord be liable to Tenant for consequential damages, or lo ss ofor interference with Tenant's bu s iness, including without limitation lost profits. 12.4 Expenses of Prevailing Party. If either party incurs any expense, includin g reasonable attorneys' fees , in connection with any action o r proceeding instituted by either party arising o ut of this Lease, the party prevailing in s uch action or proceeding shall be entitled to recover its reasonabl e expenses including attorneys ' fees from the o ther party. 13. SIGNS. Tenant shall not, without Landlord 's prior written consent, w hi c h shall not be unreasonably withheld cons istent with the C ity 's s ign ordinance, in stall or affi x to any portion of the Premises any exterior or interior window, door or other signs, lettering, placards or the like (coll ecti ve ly Sign s"). If Landlord consents to the erection o f any Signs, such Signs s hall comply with a ny s ig n c riteria imposed by Landlord and all applicable laws . 14 . RIGHT OF ENTRY. On 48 hours' notice Landlord a nd its agents sha ll have free access to the Premises during regular bus iness hou rs for the purpose of examining the same to ascertain if they are in good re pair, making repairs or in stallati ons which Landlord may be pe rmitted to make here under, performing Landlord 's obligations under this Lease, protecting the Premises, posting notices of non- respon s ibili ty, and ex hibiting the same to prospective purchasers, len de rs or tenants. 15 . TRANSFER OF LANDLORD 'S INTEREST. U po n any transfer o r transfers of Landlord 's interest in the Premises, the transferor shall be automatically relieved of a ny and all obligations and liabilities on the part of Landlord accruing from and after the date of s uch transfer, provid ed that the transferee is liable for any and a ll obligations and liabilities on the part of Landlord accruing from and after the date of such transfer. Tenant shall atto rn to a ny transferee of Landlord 's interest in the Premises . 16 . INTEREST. Any amount due from o ne Pa1iy to the other hereunder which is not paid when due shall bear interest from the due date until paid an amrnal rate of interest (the "Stipulated R ate") equal to the greater of (i) ten percent (10%); or (ii) five percent (5%) plus the rate established by the Fede ral Reserve Bank of San Francisco, as of the twenty-five (25th) day of the mo nth immediately preceding the due date, on advances to member banks under Sections 13 and 13(a) of the Federal Reserve Act, as now in effect or he reafter from time to time amended. Payment of such interest shall not excuse or cure any default by a Party under thi s Lease . 17 . PROHIBITE D TRANSACTION. Tenant represents and warrants that neither Tenant nor any of its affiliates h ave engaged in any dealings or tran sactions, directly or indirectl y, (i) in contravention of any U.S., international or other money laundering regu lations or conventions now or he reafter in effect, o r any enabling legi s lati on o r executive order relating thereto , or (ii) in contrave ntion of Executive Order No. 13244 issued by the Pres id e nt of the U nited States (Executive Order Blocking Property and Prohibiting Transactions with Person s Who Commit, Threaten to Commit, or Support Terrorism) or any regulations promulgated th ereunder, as may be a mended o r s upplemented from time to time ("Anti- Terrori s m Order"), or (iii) on beh a lf of terrorists or terrorist organizations, including those persons or e ntities that are included on any re levant li sts maintained by the United Nations, North Atlantic Treaty 4820-8468-4725v5 SSCORDELIS\04706083 - 10- Organization, Organization of Economic Cooperation and Development, Financial Action Task Force, U.S. Office of Foreign Assets Control, U.S. Securities & Exchange Commission, U.S. Federal Bureau of Investigation, U.S. Central Intelligence Agency, U.S. Internal Revenue Service, or any country or organization, all as may be amended from time to time. Tenant represents and warrants to the best of its knowledge that neither Tenant nor any of its affiliates are a person described in section 1 of the Anti- Terrorism Order and neither Tenant nor any of its affiliates have engaged in any dealings or transactions, or otherwise been associated with any such person. If at any time any of the representations and warranties in this Paragraph becomes false then it shall be considered a non-curable default by Tenant under this Lease. 18. OPTION TO EXTEND. Landlord hereby grants to Tenant three (3) options (each, an Option" and , collectively, the "Options") to extend the term of the Lease for an additional two (2) years each (each, an "Option Period") upon and subject to the terms and conditions set forth in this Lease. Tenant shall have no right to extend the term of the Lease except as expressly provided herein. The Options shall be personal to Advantage Peak LLC, a California limited liability company, and shall not be transferrable or assignable to any assignee of this Lease, or any other third party. The first Option Period shall commence upon the expiration of the initial term of the Lease ("Initial Term"), the second Option Period shall commence upon the expiration of the first Option Period (if applicable), and the third Option Period shall commence upon the expiration of the second Option Period (if applicable). Tenant may not exercise the second Option if Tenant has not exercised the first Option, and Tenant may not exercise the third Option if Tenant has not exercised the second Option. Each Option shall be exercised, if at all, by Tenant's delivery of written notice of exercise to Landlord no later than nine (9) month s nor earlier than twelve (12) months prior to the expiration date of the Initial Term with respect to the first Option, no later than nine (9) months nor earlier than twelve ( 12) months prior to the expiration of the first Option Period with respect to the second Option and no later than nine (9) months nor earlier than twelve (12) months prior to the expiration of the second Option Period with res pect to the third Option. The Base Rent to be paid during the first year of the first Option Period s hall be the Prevailing Market Rent, as hereinafter defined. For each succeeding year of all Option Periods, Base Rent shall be increased by three percent of the preceding year's Base Rent. As used herein, the tenn "Prevailing Market Rent" shall mean the rent (including any additional rent a nd/or applicable base year) and all other monetaiy payments and escalations that Landlord could obtain from a third party tenant comparable to Tenant desiring to lease the Premises for the first Option Period, taking into account the age of the Premises, the size of the Premises, the type and quality of tenant improvements, the location of the Premises, the quality of construction of the Premises, the services provided under the terms of the Lease, the rent and brokers ' commissions then being paid for the renewal of leases of space comparable to the Premises in the City of Gilroy, and all other factors, including any rent abatement concessions, tenant improvement allowances and all other concessions then prevailing in the market for office/research and development buildings in Gilroy , that would be relevant to a third party in determining the rent such party would be willing to pay to lease the Premises for the first Option Period; provided, however, in no event s hall the Prevailing Market Re nt be less than the Base Rent payable by Tenant to Landlord at the expiration of the Initial Term. If (i) a default by Tenant exists or ripens under any of the terms , covenants, or conditions of this Lease or (ii) Tenant does not occupy the entire Premises, either at the time Tenant exercises the applicable Option or at any time thereafter prior to the commencement date of the applicable Option Period, then in each case, Tenant's exercise of the applicable Option shall be of no force and effect and Tenant shall have no rights hereunder to extend the term of the Lease. On o r before five (5) days after Tenant provides Landlord with notice of Tenant's exercise of the first Option, Landlord and Tenant shall commence negotiations to agree upon the Prevailing Market Rent. IfLandlord and Tenant are unable to reach agreement on the Prevailing Market Rent within ten ( 10) days after the date negotiations commence, then the Prevailing Market Rent shall be determined as follows: 4820~468-4725v5 SSCORDELIS\04706083 - 11- a) If Landlord and Tenant are unable to agree on the Prevailing Market Rent within said ten ( I 0) day period, then, within five ( 5) days thereafter, Landlord and Tenant shall each simultaneously submit to the other in a sealed envelope its good faith estimate of the Prevailing Market Rent. If the higher of such estimates is not more than one hundred five percent (I 05%) of the lower of such estimates, then the Prevailing Market Rent shall be the average of the two estimates; provided, however, in no event shall the Prevailing Market Rent be less than (x) with respect to the first Option Period, the Rent payable by Tenant to Landlord at the expiration of the [nitial Term and/or (y) with respect to the second Option Period, the Rent payable by Tenant to Landlord at the expiration of the first Option Period and/or (z) with respect to the third Option Period, the Rent payable by Tenant to Landlord at the expiration ofthe second Option Period. b) If the matter is not resolved by the exchange of estimates as provided in subparagraph (a) above, then either Landlord or Tenant may, by written notice to the other on or before five (5) days after the exchange of such estimates, require that the disagreement be resolved by arbitration. Within seven (7) days after such notice, the parties s hall select as an arbitrator a mutually acceptable MAl appraiser with experience in real estate activities, including at least ten (10) years' experience in appraising office space in the County of Santa Clara, California. ff the partie s cannot agree on an appraiser, then, within a second period of seven (7) days, each party shall select an independent MAI appraiser meeting the aforementioned criteria and, within a third pe riod of seven (7) d ays, the two appointed appraisers shall select a third appraiser meeting the aforementioned criteria and the third appraiser shall determine the Prevailing Market Rent pursuant to subparagraph (c) below. If one party shall fail to make such appointment within said second seven (7) day period, then the appraiser chosen by the other party shall be the so le arbitrator. c) Once the arbitrator has been selected as provided for in subparagraph (b) above, then, as soon as practicable but in any case within fourteen (14) day s thereafter, the arbitrator shall select one of the two estimates of the Prevailing Market Rent submitted by Landlord and Tenant, which estimate shall be the one that is closer to the Prevailing Market Rent as determined by the arbitrator; provided, however, in no event shall the Prevailing Market Rent be less than the Base Rent payable by Tenant to Landlord at the expiration of the Initial Term. The arbitrator's selection shall be rendered in writing to both Landlord and Tenant and shall be final and binding upon them and shall not be subject to appeal. ff the arbitrator believes that expert advice would materially assist such arbitrator, then the arbitrator may retain one or more qualified persons, including, but not limited to, legal counsel , brokers, architects or engineers, to provide such expert advice. The party whose estimate is not chosen by the arbitrator shall pay the costs of the arbitrator and of any experts retained by the arbitrator; provided, however, that any fees of any counsel or expert engaged directly by Landlord or Tenant shall be borne by the party retaining such counsel or expert. 19. MISCELLANEOUS. 19 .1 Time of Essence. Time is of the essence with respect to the performance of every provision of this Lease. 19.2 Captions. The article and paragraph captions contained in this Lease are for convenience only and shall not be considered in the construction or interpretation of any provis ion hereof. 19.3 Entire Agreement and Amendments. This Lease contains all of the agreements of the parties hereto with respect to any matter covered or mentioned in this Lease, and no other agreement or understanding pertaining to any such matter shall be effective for any purpose. No provision of this Lease may be amended or added to except by an agreement in writing signed by the parties hereto or their respective successors in interest. 4820-8468-4725v5 SSCORDELIS\04706083 - 1 2 - 19.4 Notice. Any notice required or permitted to be given hereunder shall be in writing and may be served personally (which inc ludes without limitation delivery by overnight courier services) or by mail. All notices shall be sent to the fo ll owing addresses: Landlord: Tenant: City of Gilroy 7351 Rosanna Street Gilroy, CA 95020 Attn: Landlord Administrator Advantage Peak LLC 7560 Monterey Road Gi lroy, CA 95020 Attn: -------- Any notice so given by mail shall be deemed effectively given three (3) days after being deposited in the Un ited States mail, registered or certified, postage prepaid and addressed as specified herein. Either party may by written notice to the other specify a different address for notice purposes. Notwithstanding the foregoing, any legal notices required to be sent by one party to the other (including without limitation, a notice pursuant to California Code of Civi l Procedure Section 1161) shall be delivered in the manner required or allowed by law. 19.5 Holdover. This Lease shall terminate without further notice at the expiration of the Term. Any holding over after Lease Termination with the consent of Landlord shall be construed to be a tenancy from month to month, but otherwise on the same terms and conditions set forth in this Lease. If Tenant remains in possession of the Premises after Lease Termination without Landlord 's consent or fail s to surrender the Premises in the condition required by Paragraph 6.3, Tenant shall pay holdover monthly Base Rent during such holdover period in the amount of two hundred percent (200%) of the Base Rent in effect immediately before such holdover period, and Tenant shall indemnify, defend and hold Landlord and Landlord's employees, representatives and agents harmless from and against any claims, losses, damages, judgments, expenses or li abi lities (inc ludin g without limitation attorneys' fees) resulting from Tenant's fai lure to surrender the Premises in the required condition, including without limitation, any claims made by any succeeding tenant based upon delay in the availabili ty of the Premis es, which obligations shall survive Lease Termination. 19.6 Brokers. Tenant warrants and represents that it has had no dealings with any real estate broker or agent in connection with the negotiation of this Lease. Tenant agrees to defend, indemnify and hold Landlord and Land lord 's employees, representatives and agents hannless from and against any and a ll c laims, losses, damages, liabilities, judgments or expenses (including without limi tation attorney's fees) arising out of or in connection with c laims made by any broker or individual for commissions or fees resulting from Tenant's execution of this Lease, wh ich obligations shall survive Lease Termination. 19.7 Acceptance. Delivery of this Lease, duly executed by Tenant, constitutes an offer to lease the Premises, and under no circumstances shall such delivery be deemed to create an option or reservation to lease the Premises for the benefit of Tenant. This lease shall only become effectiv e and binding upon fu ll execution hereof by Landlord and delivery of a signed copy to Tenant. 19 .8 Waiver. The waiver by e ither Party of any breach of any term, condition or covenant of this Lease shall not be deemed to be a waiver of such provision or any subsequent breach of the same or any other term, cond iti on or covenant of this Lease. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any preceding breach at the time of 4820-8468-4725v5 SSCORDELIS\04706083 - 13- acceptance of such payment. No covenant, term or condition of this Lease shall be deemed to have been waived by either Party unless such waiver is in writing signed by that Party. 19.9 Separability. If one or more of the provisions contained herein, except for the payment of Rent, is for any reason held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Lease, but this Lease shall be construed as if such invalid , illegal or unenforceable provision had not been contained herein. 19.10 Liens. Tenant shall pay for all labor and services performed for, and all materials used by or furnished to Tenant or Tenant's Agents and keep the Premises free from any liens arising out of work performed, materials furnished, or obligations incurred by Tenant or Tenant's Agents with respect to the Premises. Tenant shall indemnify, hold harmless and defend Landlord and Landlord's employees, representatives and agents from and against any liens, demands, claims, judgments, losses, liabilities, damages, expenses or encumbrances (including all attorneys ' fees) arising out of any work or services performed for or materials used by or furnished to Tenant or Tenant's Agents with respect to the Premises. Tenant shall do all things necessary to prevent the filing of any mechanic's or other liens against the Premises or any part thereof by reason of work, labor, services or materials supplied or claimed to have been supplied to Tenant, or anyone holding the Premises, or any part thereof, through or under Tenant. If any such lien shall at any time be filed against the Premises, Tenant shall either cause the same to be discharged of record within ten (10) days after the date of filing of the same, or, if Tenant in Tenant's discretion and in good faith determines that such lien should be contested, Tenant shall furnish such security as may be necessary or required to (a) prevent any foreclosure proceedings against the Premises during tbe pendency of such contest, and (b) cause a mutually satisfactory title company to remove such lien as a matter affecting title to the Premises. If Tenant shall fail to discharge such lien within such period or fail to furnish such security, then, in addition to any other right or remedy of Landlord resulting from Tenant's said default, Landlord may, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien by giving security or in such other manner as is, or may be, prescribed by law. Tenant shall repay to Landlord on demand all sums disbursed or deposited by Landlord pursuant to the foregoing provisions of this Paragraph 20.10 including Landlord 's costs, expenses and reasonable attorneys' fees incurred by Landlord in connection therewith, with interest thereon at the Stipulated Rate. Nothing contained herein shall imply any consent or agreement on the pa1t of Landlord to subject Landlord 's estate to liability under any mechanics' or the lien law. Tenant shall give Landlord adequate oppo1tunity and Landlord shall have the right to post such notices of non-responsibility as are provided for in the mechanics' lien laws of California. Tenant's obligations pursuant to this paragraph shall survive Lease Termination. 19.11 Encumbrances. This Lease is subject and subordinate to ground and underlying leases, mortgages, deeds of trust and other monetary liens (collectively "Encumbrances") which may now affect the Premises, to any covenants, conditions or restrictions of record , and to all renewals, modifications, consolidations, replacements and extensions thereof; provided, however, if the holder or holders of any such Encumbrance ("Holder") shall require that this Lease be prior and superior thereto, within seven (7) days after written request of Landlord to Tenant, Tenant shall execute, have acknowledged and deliver any and all documents or instruments, in the form presented to Tenant, which Landlord or Holder deems necessary or desirable for such purposes. Landlord shall have the right to cause this Lease to be and become and remain subject and subordinate to any and all Encumbrances which are now or may hereafter be executed covering the Premises or any renewals, modifications, consolidations, replacements or extensions thereof, for the full amount of all advances made or to be made thereunder and without regard to the time or character of such advances, together with interest thereon and subject to all the terms and provisions thereof. Within ten (10) days after Landlord 's written request, Tenant shall execute any and all documents required by Landlord or the Holder to make this Lease subordinate to any lien of the Encumbrance. If Tenant fails to do so, then in addition to such failure constituting a default by 4820-8468-4725v5 SSCORDELIS\04706083 - 14- Tenant, it shall be deemed that this Lease is so subordinated to s uch Encumbrance. Tenant hereby attorns and agrees to attorn to any entity purchasing or otherwise acquiring the Premises at any sale or other proceeding or pursuant to the exercise of any other rights, powers or remedies under such Encumbrance so long as the Lease remains in effect. 19.12 Landlord's Right to Perform Tenant's Covenants. lf Tenant fails to make any payment or perform any other act on its pait to be made or performed under this Lease, Landlord may, but shall not be obligated to and without waiving or releasing Tenant from any o bligation of Tenant under this Lease, make s uch payment or perform s uch other act to the extent Landlord may deem desirable, and in co1111ection therewith, pay expenses and employ counsel. All s ums so paid by Landlord and all penalties, interest and costs in connection therewith shall be due and payable by Tenant immediately on demand, together with interest at the Stipulated Rate from date of payme nt by Landlord to the date of payment by T e nant to Landlord, plus collection costs and attorneys' fees. If Tenant damages the Prem ises, Tenant shall have a reaso nable opportunity to repair the damage and Landlord may not repair the damage and charge Tenant for the repair unless Landlord gives Tenant thirty (30) days' written notice, except that if such repair would reasonably take more than thirty (30) days Landlord may not make the repair until such reasonable time has run. l 9.13 Tenant's Remedy. If, because of a default by Landlord under this Lease, Tenant recovers a money judgment against Land lord, s uch judgment s hall be sati sfied on ly out of the proceeds of sale received upon execution of such judgment and levied thereon against the right, title and interest of Land lord in the Premises and out of rent or other income from the Premises receivable by Landlord, and neither Landlord, nor its employees, representatives or agents, shall be personally liable for any deficiency. Neither Landlord' s employees, agents, nor representatives, nor any other person or entity other than Landlord, nor any of their respective assets, shall be liable for Landlord' s breach of this Lease. 19.14 Exhibits. All exhibits, amendments, riders and addenda attached hereto are hereby incorporated herein and made a part hereof. 19.15 Conditions. All agreements of Tenant contained in this Lease, whether expressed as conditions or covenants, shall be construed to be both conditions and covenants, conferring upon Landlord, in the event of a breach thereof, the right to terminate this Lease. 19.16 No Partnership or Joint Venture. Nothing in this Lease shall be construed as creating a partnership or joint venture between Landlord, Tenant, or any other patty, or cause Landlord to be res pons ible for the debts or obligations of Tenant or any other party . 19 .17 Construction. This Lease shall not be construed either for or against Tenant or Landlord, but s hall be construed in accordance with the general tenor of the language. This Lease shall be construed in accordance with the laws of the State of California. 19.18 Joint and Several Liability. If Tenant consists of more than one (1) person or e nt ity, the obli gations of each Tenant under this Lease shall be joint and several. 19.19 Certified Access Specialist. For purposes of Section 1938 of the California Civil Code, Landlord hereby discloses to Tenant that, to Landlord's actual knowledge, as of the Effective Date, the Premises have not undergone inspection by a Certified Access Specialist ("CASp"). Pursuant to California Civil Code Section 1938(e), La11dlord hereby further discloses to Tenant the following: "A Certified Access Specialist (CASp) can in spect the subject pre mises and determine whether the s ubject 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 4820-3468-4 725v5 SSCORDELIS\04706083 - 15- 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." Notwithstanding the foregoing and/or anything to the contrary contained in this Lease, 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' pri or written notice and, upon receipt of such notice, Landlord shall have the right to, among 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 s hall (i) 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, (ii) 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 (iii) pay for the CASp in s pection 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 ins pection und ertaken on behalf, or for the benefit, of Tenant, then Tenant shall cause such certificate to b e provided immediately to Landlord. z) If the CASp Report identifies any v iolation(s) of applicable construction-related accessibility standards ("CASp Violation(s)"), Tenant shall immediately provide written not ice to Landlord of any and all s uch 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 CASp Violation(s) (any such repairs, modifications and/or other work being collectively referred to here in as the "CASp Work"). Tenant shall commence (or cause the commencement of) such CAS p Work no later than fifteen ( 15) bus iness days after Landlord 's receipt of the CASp R eport in accordance with the terms and conditions of this Lease. 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, o btain an updated CASp Report showing that the Premises then comply w ith 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 Land lord 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 Premi se s not having been ins pected by a Certified Access Specialist (CASp); (ii) Tenant's indemnity obligations set forth in this Lease shall include any and all claims relating to or arising as a res ult 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. 19.20 Binding Effect. Subject to the provisions of Paragraphs 9 and 15 , a ll of the provisions hereof shall bind and inure to the benefit of the pa1ties here to and their respective heirs , legal representatives, successors and permitted assigns. 4820-8468-4725v5 SSCORDELIS\04706083 - 16- 4820-8468-4725v5 SSCORDELIS\04706083 S ignatures Appear o n Foll owin g Page] 1 7- IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first stated above. LANDLORD: APPROVED AS TO FORM: City Attorney 4820-8468-4725v5 SSCORDELIS\04706083 TENANT: 1 8-